Reputation Management Issues in Court
Even the most solid reputations can be somewhat fluid online. Great and well known brands have been damaged online in ways previous generations never had to consider. From the easy sale of knock-off products and stolen inventory to the kiss-off tone of many consumer complaints, large business operations are uniquely vulnerable to the undermining influence of unscrupulous individuals or small groups.
An isolated issue with a prolific individual can lead to hundreds or even thousands of duplicate complaints in blog posts (often replicated and reprinted), comments, on unofficial consumer advocate sites, and even in paid search results. Online, one person can look like many far easier than they could have just over a decade ago.
Similarly, the small cartels of counterfieters that can move fake merchandise from factory to street-corner in a matter of days have found a more comfortable way to hawk their faux-wares. The Internet provides the fakers a virtually unlimited number of options to present items for sale to consumers including some that are considered highly legitimate marketplaces like eBay. Many major corporations share a multi-billion dollar problem and to make the matter worse, few of them realize the actual extent of it.
Metamend has offered search marketing services for over a decade. In that time, we’ve come across examples of small operators taking advantage of large corporations every day. Because our staff (all of whom are tech obsessive) is populated with persons of diverse talents and interests, the violations we collectively see are witnessed and noted on a daily basis.
While we can’t discuss the reputation management cases we work with (such is the nature of the business eh?), we can write about examples we have found and cases that have transited to court. A couple are quite surprising.
Fake or Counterfeit Goods
Last month, Tiffany and Co. lost a judgment against eBay in which Tiffany alleged eBay facilitated the sale of bogus items bearing the Tiffany brand. The case, which has since been appealed by Tiffany underscores the difficulties a massive network like eBay has in policing the actions of individual vendors. It also demonstrates one aspect of the multifarious reputation problems large brands face.
In a presentation to the rest of the Metamend staff, our in-house reputation management specialist David Howell showed how the world’s largest coffee-house francise was being ripped-off by in-store staff. In more than one online marketplace or auction site, David found specially flavored syrups bearing the name and brand symbol of that company for sale. He also found several other products bearing the brand symbol and name of that corporation. In seemingly unrelated news, that same company has recently closed several money-losing stores around the world.
Trademark Infringement
Here are a couple fun cases. Both are cases of a small company trying to broker their names off a far larger and rightly established brand names.
ROSETTA STONE LTD. v. ROCKET LANGUAGES LTD.
CENTRAL DISTRICT OF CALIFORNIA (LOS ANGELES)
2:08-cv-00402
FILED: 7/02/2008
In this case, Rocket Languages published a number of PPC ads comparing their product to the well known Rosetta Stone line. The ads led to landing pages which were designed to look like legitamate comparison shopping pages but which had in fact been created by affiliates of Rocket Languages.
Rosetta Stone’s suit alleges trademark infringement, trademark dilution, unfair competition, false advertising, contributory trademark enfringement and vicarious trademark infringement. They are requesting an injunction to prevent Rocket Languages from engaging in such practices as well as financial damages, lawyer’s fees, court costs and interest.
We covered this case in a June 2008 blog post, “PPC Ads as a Reputation Management Issue”
BELLAGIO, LLC v. HEAVENLY BLISS WEDDING CHAPEL 3, LLC AND JUPITER J. DESPHY, IV
DISTRICT OF NEVADA (LAS VEGAS)
2:08-cv-00923
FILED: 7/16/2008
You have to have a certain degree of moxie but very little savvy to mess with one of the most established casino brand names in Las Vegas. On its website, a tiny wedding chapel business suggested it was doing business with the Bellagio. Images on the site showed weddings taking place on the Bellagio grounds and in Bellagio facilities. At issue is the fact that the Bellagio already has a wedding service and doesn’t appreciate its competition pretending to be that service.
Bellagio is asking for an injunction preventing the Defendents from using their trademarks, entering their facilities or properties for commercial purposes or making false or misleading claims regarding Bellagio’s approval of or sponsorship of the Defendent’s services. The casino company is also asking for dompensatory, consequential, incidental and punative damages as well as lawyers fees and court costs.
Domain Names, Complaint Sites and Cybersquatting
Disputes over domain names are among the most frequent Reputation Management issues large companies face. It is relatively inexpensive to register a domain name and host a website. Often, large companies are not aware they are being imitated, spoofed or unfairly represented online until the damage has already been done.
Here is one which on the surface might seem silly. Underlying the silliness of the subject is a very serious issue. Anyone can pretend to be your company online. Some even go as far as to create a website that looks, acts and feels exactly like the website they are targeting with malicious intent.
MARIO LAVANDEIRA v. INFUSE, LLC ET AL.
CENTRAL DISTRICT OF CALIFORNIA (LOS ANGELES)
2:08-cv-04764
FILED: 7/21/2008
Ever heard of Perez Hilton? Perez Hilton is one of the most well known celebrity bloggers in the world. Though his behavior and methods offer grist for debates on ethics, he has formed a solid following of millions and is known to be one of the most prolific celebrity followers in America.
He is not necessarily well liked by his paparazzi peers some of whom have established a competing celebrity gossip site at the URL PerezRevenge.com/. PerezRevenge looks, feels and tastes like the PerezHilton.com website in many ways except that PerezRevenge takes special delight in insulting and baiting Perez Hilton.
Considering the name Perez a common law trademark, PerezHilton.com alleges PerezRevenge uses the name frequently on its website, including the mentions in the site’s meta data. PerezHilton is thus suing PerezRevenge for; unfair competition, false designation of origin, federal dilution, cybersquatting and unfair competition and deceptive trade practices. PerezHilton is seeking a temporary, preliminary and perminent injunction against the acts of PerezRevenge. PerezHilton is also seeking monitary damages.
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These five cases show the broad range of issues that fall under the Reputation Management heading. As the online marketplace matures, we expect to see and help straighten out hundreds of other cases. We sincerely hope yours isn’t among them but if you do find yourself swimming upstream against a torrent of malicious or unfair representations, we’re here to help.
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