Use of trademarks on corporate Web sites can be fraught with pitfalls. The misuse of trademarks belonging to third parties can result in serious consequences, such as claims of infringement, dilution or false advertising. The circumstances under which one may fairly use the trademark of another is rather limited, so Web site designers, Web masters or other responsible persons can easily reduce exposure to such negative consequences by ensuring that use of third-party marks falls within one of the following four categories.

1. Expressly Authorized Use. Companies may obtain express authorization to use the trademarks of others on their Web sites through linking agreements, content distribution agreements, co-branding agreements, and authorized re-seller or servicer agreements. These documents typically include a license to display the mark in a specified manner; the owner' s specifications regarding use, placement and appearance of the mark in question should be followed strictly.

2. Comparative Advertising. In the United States, it is not an infringement of a trademark to use it in connection with accurate and non-deceptive comparative advertising. Truthful comparative advertising is considered to be beneficial to competition, provided that the use of the competitor' s mark is accurate and does not in any way imply an affiliation or endorsement by the trademark owner. Other countries have varying attitudes toward comparative advertising, so caution should be exercised with respect to advertisements directed to audiences outside the United States.

3. Use of Words in a Descriptive, Non-Trademark Sense. The law considers it a " fair use" of a trademark when one uses the words in the mark as a descriptive term in their ordinary, non-trademark sense. For example, MOUNTAINEER is a trademark of the Ford Motor Company used in connection with sport utility vehicles; it may be considered a fair use for a competitor to suggest that its SUV is owned by numerous mountaineers, provided the statement is accurate and the overall impression is not deceptive or confusing.

4. Accurate Statements Regarding Qualifications, Awards or Compatibility. It is generally permissible to use trademarks of others in connection with accurate statements regarding such matters as the previous employment of executives, awards received or product compatibility. Resellers and servicers may use third-party trademarks to describe their inventory or expertise. In all cases, the third-party mark must be properly credited and no current affiliation or endorsement should be stated or implied.

These rules generally apply whether one uses a third-party mark in the visible contents of a Web site, in the domain name of the site or URL for a particular page, or in metatags. In one recent influential case, Brookfield Communications, Inc. v. West Coast Entertainment Corporation, the U.S. Court of Appeals for the Ninth Circuit expressly recognized that the online use of another' s trademark, even by a competitor, would be permissible if it accurately described some aspect of the information contained in the Web site and constituted a fair use.

Nevertheless, it is generally never acceptable to use the trademark of a third party in one' s own domain name because it tends to imply a connection with or endorsement by the trademark owner, and thereby generates " initial interest confusion" among persons finding the site on the Web. Indeed, such use may subject one to liability under the federal Anticybersquatting Consumer Protection Act, enacted in November 1999. Under that act, a trademark owner can prevail (and be entitled to damages of up to $100,000 per infringement) by showing that the defendant, in bad faith and with intent to profit, registered a domain name consisting of the plaintiff' s distinctive trademark. Repatriation of an infringing domain name is also available under the new Uniform Domain Name Dispute Resolution Policy administered by the Internet Corporation for Assigned Names and Numbers (" ICANN"), which became effective in January 2000. This policy, which is a non-exclusive and far less expensive alternative to court action, provides a binding arbitration-like proceeding whereby trademark owners can obtain ownership of domain names which are identical or confusingly similar to the subject trademark and were registered in bad faith by others with no legitimate interest in the name.

However, at least two lower federal courts have stated that it is permissible to use a third-party trademark in an extended URL of a Web page (i.e., to the right of the " .com") if that use accurately describes the content of that page. Paccar, Inc. v. TeleScan Technologies, L.L.C., 2000 U.S. Dist. LEXIS 12857 (S.D. Mich. August 25, 2000); Patmont Motor Werks, Inc. v. Gateway Marine, Inc., 1997 U.S. Dist. Lexis 20877, n.6 (N.D. Cal. Dec. 18, 1997).

The use of third-party trademarks in metatags is a matter of much dispute. Trademark owners typically contend that such use unfairly and deceptively diverts Web surfers away from the mark owner' s own site. At least one federal court has agreed and enjoined a non-authorized reseller of trucks from using a truck manufacturer' s marks in its metatags. Paccar, supra. Other courts have declined to stop such metatag usage when the use of the mark serves a legitimate indexing purpose and would otherwise qualify as a fair use under one of the categories listed above. Playboy Enterprises, Inc. v. Welles, 47 USPQ2d 1186 (S.D. Cal 1998). Accordingly, the use of another' s trademark in metatags for your Web site should be undertaken with caution, if at all.

The Internet is still very much a wild frontier with respect to trademark law, and Web site owners are well advised to consult with experienced trademark counsel who can help to ensure that all trademarks appearing on a Web site are properly used and attributed.

This article, which may be considered advertising in certain jurisdictions, does not purport to give legal advice pertaining to any particular situation and creates no attorney-client relationship. Readers should seek professional legal advice concerning any particular situation they face.

Robert M. O'Connell practices in Goodwin Procter' s Intellectual Property/Technology Practice Area. He can be reached at roconnell@goodwinprocter.com.

Copyright © 2001 Goodwin Procter LLP. All Rights Reserved.

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