There are several cases in the where the issue of whether the purchase of keywords under a trademarked term violates the Lanham Act and whether it constitutes unfair competition.  Many of these cases have been filed against Google for selling the ad space under trademarked keywords, but in this suit, the trademark holder, skipped  suing Google and sued the advertiser, ABC.com

In the case of, Tokyo Broadcasting System v. American Broadcasting Companies, Inc., CV-08-06550-MAN (C.D. Cal.), Tokyo Broadcasting System (TBS) filed a complaint against ABC for copyright infringement, false designation of origin under the Lanham Act and unfair competition under California law and the common law.

TBS says they own or co-owns the copyrights in the television shows “Takeshi’s Castle,” “Sasuke,” and “Kunuoichi,” all of which involve contestants competing in physical challenges, similar to ABC’s show “Wipeout.”  TBS also alleged that it owned trademark rights in the names of the shows.  All of TBS’s shows originated in Japan and were licensed for broadcast in the United States.

ABC it is alleged bought Google’s “keywords” under the names of all three TBS shows,  so when, Google users searched for the name of one of TBS’s shows, a “Sponsored Link,” appeared for the ABC show “Wipeout and www.abc.com.

TBS alleged, that by purchasing TBS’s trademarks as keywords, ABC unlawfully intercepted and diverted consumers looking for TBS’s shows and that by doing so ABC created a likelihood of consumer confusion as to the connection between ABC and TBS.

TBS alleged, ABC’s advertising was likely to confuse consumers into believing that “Wipeout” was associated with TBS’s shows.

The district court acknowledged that to prevail, TBS must show that ABC has engaged in a “use in commerce” of TBS’s marks, and that TBS’s use of those marks is likely to cause consumer confusion as to the source, sponsorship, or affiliation of ABC’s “Wipeout” show.

The court noted that the “decisional weight now seems to favor finding the requisite ‘use’ to exist” where a defendant buys a competitor’s trademark as a keyword.

However, in order to prevail, TBS would still need to show a likelihood of consumer confusion.

The court held, TBS had sufficiently pleaded that ABC’s purchase of TBS’s marks as keywords was likely to cause initial interest confusion as to the connection between “Wipeout” and TBS, and that ABC had unlawfully diverted consumers looking for TBS’s shows.  Thus, the court denied ABC’s motion to dismiss this claim and the case will move forward.

As we have said before at some point, the law in this area will be settled and the fallout it could drastically effect advertisers and the way that search engines sell keywords.