The application of trademark law to the Internet is still in its formative stages. In a major decision handed down June 27, those annoying pop-up ads survived a significant legal challenge. The United States Court of Appeals for the Second Circuit reversed the decision of the trial court and held that WhenU.com’s spyware did not infringe the federal trademark of 1-800 Contacts, Inc.
WhenU is an Internet marketing company that anonymously downloads spyware onto your computer to monitor the sites you visit. If you visit a site, the spyware program randomly generates a pop-up of one of WhenU’s customers which sells the same category of products. In this case, when a computer user visited 1-800’s web site, a pop-up of its competitor, Vision Direct, Inc., appeared.
Plaintiff, 1-800 Contacts, Inc., filed a ten count complaint against WhenU. The trial court granted 1-800’s request for a temporary injunction based upon its federal trademark infringement count.
In an interlocutory appeal, the Second Circuit panel reversed the trial court and not only vacated the in-junction but also held as a matter of law that WhenU does not “use” 1-800’s trademarks in violation of the Lanham Act when it (1) includes 1-800’s website ad-dress, which is almost identical to 1-800’s trademark, in its spyware program directory, or (2) causes eye care product pop-ups to appear when viewing 1-800 Contact’s site.
The Second Circuit’s opinion is consistent with the opinions in two other cases brought against WhenU. Perhaps the result would be different if WhenU used 1-800’s trademark in the text of the pop-up ad. A case involving that issue brought against Internet search engine giant Google is pending in U.S. District Court for the Eastern District of Virginia.
The 1-800 case is not over either. It was remanded for further proceedings on the remaining nine counts.