United States: Trademarks In Cyberspace: Ordinary Principles Of Trademark Law Apply To Domain Names And Metatags.

In Brookfield Communications, Inc. v. West Coast Entertainment Corp., 174 F.3d 1036 (9th Cir. 1999), the Ninth Circuit stated that domain names and meta-tags "do not trump long-established principles of trademark law." The trademark dispute was between West Coast Entertainment Corp. ("West Coast"), one of the nation's largest video rental store chains with over 500 stores, and Brookfield Communications, Inc. ("Brookfield"), a company offering software applications containing information about the entertainment industry. The mark at issue was "MOVIEBUFF".

Both parties asserted some rights in expressions combining "movie" and "buff." Since 1986, West Coast had used various phrases including some form of the words "Movie" and "Buff" to promote goods and services. Among these were: "The Movie Buff's Gift Guide"; "The Movie Buff's Movie Store"; "Movie Buff Picks"; "Movie Buff Series"; and others.

In 1991, West Coast obtained federal registration of the mark: "THE MOVIE BUFF'S MOVIE STORE" for video sales and rentals.

In February of 1996, West Coast registered "moviebuff.com" as a domain name, but did not launch a site at that address until 1998. Beginning perhaps as early as April of 1996, West Coast began using "moviebuff.com" in e-mail communications. In November of 1998, West Coast announced in a press release that it was about to launch the site. When West Coast rolled out the site later in 1998, it included a movie information data base. West Coast also used "moviebuff" as embedded meta-tags. These meta-tags were hypertext mark up language (HTML) code which did not appear to a user, but which would be found by web search engines. West Coast's "moviebuff" meta-tags apparently led to other sites maintained by West Coast, including "westcoastvideo.com".

Meanwhile, in 1997 and 1998, Brookfield was perfecting rights in the expression "MOVIEBUFF." Brookfield filed an application for federal registration of MOVIEBUFF in August 1997, and obtained registration in 1998, for computer software providing "information in the field of motion picture and television industries," and providing "an on-line network database offering information" in the field of motion picture and television industries.

After West Coast launched its site, Brookfield sued to enjoin West Coast from using "moviebuff.com" as the address, and from using "moviebuff" in meta-tags within that or any other site of West Coast. Though West Coast prevailed at the trial court level, the Ninth Circuit reversed, making several interesting points on its way to a ruling in favor of Brookfield:

• No Likelihood of Confusion (West Coast's 1991 Registration v. Brookfield's Mark). In the first place, the Ninth Circuit noted that, although West Coast had registered "THE MOVIE BUFF'S MOVIE STORE" in 1991, there was no likelihood of confusion between that mark and Brookfield's later-registered "MOVIEBUFF" mark. The Court was influenced both by West Coast's concession that there had been no actual confusion, and by the fact that the U.S. Patent and Trademark Office had permitted Brookfield's mark to be registered in the face of West Coast's prior registration.
• No Tacking (West Coast's 1991 Trademark Registration Does Not Establish Priority for West Coast's 1996 Domain Name). The Ninth Circuit acknowledged that West Coast's mark, THE MOVIE BUFF'S MOVIE STORE, was incontestable, and had been used by West Coast as a trademark since 1986. But the Court did not permit West Coast to "tack" its "moviebuff.com" domain name back to the early uses of West Coast's other mark. The Court ruled that tacking applies only in the "exceptionally narrow instance" where the "previously used mark is the legal equivalent of the mark in question or indistinguishable therefrom such that consumers consider both as the same mark." Id. at 1048-49 (internal quotations omitted). The Court recognized the standard for tacking as being "exceedingly strict" and "considerably higher" than the standard for likelihood of confusion. Observing that West Coast's "moviebuff.com" expression contained three fewer words, dropped the possessive, omitted a space, and added ".com", the Court ruled that the case was a clear one, and did not permit any tacking of West Coat's "moviebuff.com" to its much earlier "THE MOVIE BUFF'S MOVIE STORE" mark. Id. at 1049.
• Domain Name Registration is Not "Use" in the Trademark Sense. Having held that West Coast could not "tack" its 1996 domain name registration back to an earlier use, the Ninth Circuit held that the registration of the domain name in February of 1996, without more, did not constitute any "use" in the trademark sense. Interestingly, the Ninth Circuit clearly stated that West Coast could have established common law trademark rights prior to use - - the Court stated that trademark rights "can vest even before any goods or services are actually sold" if "the totality of [one's] prior actions, taken together, [can] establish a right to use the trademark." Id. at 1052. In fact, the Court awarded West Coast a first use date in November of 1998 "when it first made a widespread and public announcement about the imminent launch of its web site" by way of a press release. Id. at 1053 (emphasis added). The problem for West Coast was that the press announcement was still not early enough. The Court did not accept the February 1996 date of West Coast's domain name registration, nor did it accept the April 1996 date when West Coast began to use the expression in e-mail communications. Thus, while the Court applied a generous standard to allow West Coast's November 1998 press announcement to establish use, that date was still too late for West Coast to beat Brookfield's August 1997 registration-priority for MOVIEBUFF.
• The Domain Name Use Constituted Infringement – Having established that Brookfield was the senior user of MOVIEBUFF, based on its 1997 registration-priority date, the Court applied an eight factor test to determine if West Coast's "moviebuff.com" infringed. Perhaps the most significant factor was the Ninth Circuit's reversal of the trial court's determination that Brookfield and West Coast were non-competitors. "Not only are they not non-competitors, the competitive proximity of their products is actually quite high." Id. at 1056. After this appellate finding, West Coast was left with a domain name which was essentially identical to Brookfield's mark, and which was associated with products that competed with Brookfield's. Though the other factors were discussed, the ultimate finding of infringement would seem almost a foregone conclusion.
• The Meta-tag Use Also Constituted Infringement – The next question was this: though West Coast's "moviebuff" meta-tags were hypertext markup language code not visible to casual web users, could those tags be used to direct traffic to West Coast's other web sites without constituting infringement. In addition to considering the same factors which established a likelihood of confusion with the domain name address, the Court also found that the meta-tags themselves caused initial interest confusion. Even if a potential customer's input of "moviebuff" through a search engine identifies what is clearly a West Coast web site (for example, "westcoastvideo.com") and though it is apparent that the proprietor of that site is West Coast, not Brookfield, the initial interest confusion still constitutes an act of infringement by diverting those persons who may have been looking for Brookfield's "MOVIEBUFF" to West Coast's site. Id. at 1062.
• A Somewhat Limited Remedy – But, when it came time for a remedy, West Coast was given the right to use words of the English language in a non-trademark, descriptive fair use sense. The Ninth Circuit said that West Coast could use "Movie [space] Buff." The Court observed that the word spacing made all the difference: "Even though ["MovieBuff"] differs from "Movie Buff" by only a single space, that difference is pivotal… The proper term for "motion picture enthusiast" is "Movie Buff," which West Coast certainly can use. It cannot, however, omit the space." Id. at 1066 (emphasis in the original).

This case applies the principle that the registration and subsequent use of a domain name for a web site "does not trump long-established principles of trademark law" and that using a competitor's trademark in the meta-tags of a web site is likely to cause initial interest confusion. As the Ninth Circuit observed: "These forms of confusion are exactly what the trademark laws are designed to prevent." Id. at 1066.