Interactive Products v. A2Z Mobile Office Solution

• Decision Date: 10 April 2003
• Docket Number: No. 01-3590.,01-3590.
• Citation: 326 F.3d 687
• Parties: INTERACTIVE PRODUCTS CORPORATION, Plaintiff-Appellant, v. A2Z MOBILE OFFICE SOLUTIONS, INC., Brian Lee, Mobile Office Enterprise, and Douglas Mayer, Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

326 F.3d 687

INTERACTIVE PRODUCTS CORPORATION, Plaintiff-Appellant, v. A2Z MOBILE OFFICE SOLUTIONS, INC., Brian Lee, Mobile Office Enterprise, and Douglas Mayer, Defendants-Appellees.

No. 01-3590.

United States Court of Appeals, Sixth Circuit.

Argued: October 18, 2002.

Decided and Filed: April 10, 2003.

Rehearing and Suggestion for Rehearing En Banc Denied: June 6, 2003.

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John J. Helbling (briefed), Cincinnati, OH, Eric W. Guttag (briefed and argued), Smith, Guttag & Bolin, Ltd., Mason, OH, for Plaintiff-Appellant.

Charles H. Melville, Strauss & Troy, Cincinnati, OH, Thomas P. Liniak (briefed and argued), Liniak, Berenato, Longacre & White, Bethesda, MD, James D. Liles (briefed and argued), Joseph P. Mehrle, Dinsmore & Shohl, Cincinnati, OH, for Defendants-Appellees.

Before: BATCHELDER, COLE, and GIBBONS, Circuit Judges.

OPINION

GIBBONS, Circuit Judge.

This case presents a novel trademark issue with regard to the Internet along with several other more straightforward issues. Interactive Products Corporation ("IPC") brought this action alleging, among other things, federal and state claims of trademark infringement, false designation of origin, false advertising and trademark dilution. IPC's claims arise primarily out of the fact that defendant a2z Mobile Office Solutions, Inc. ("a2z") maintains an Internet web page that contains IPC's trademark in its URL.¹ IPC also complains about a particular message that appeared for about a year on a2z's web page regarding IPC's trademarked product.

The district court granted summary judgment in favor of defendants on all of IPC's claims, and IPC appeals with regard to certain of its claims. IPC also appeals the district court's award of defendants' attorneys' fees and expenses incurred in opposing IPC's motion to compel the depositions of defendants' attorneys. Also before this court is the motion of defendants Mobile Office Enterprise ("MOE") and Douglas Mayer for sanctions against IPC for bringing a frivolous appeal as to them.

Because the district court reached the correct result in granting summary judgment in favor of defendants on all of IPC's claims, we affirm that decision. We also affirm the district court's decision regarding the magistrate judge's award to defendants of expenses incurred in opposing plaintiff's motion to compel. We deny defendants MOE and Mayer's motion for sanctions against IPC.

I. RELEVANT TECHNOLOGY

Resolution of the legal issues presented in this case requires a basic understanding of the Internet.² The Internet is a global network of interconnected computers that allows individuals and organizations around the world to communicate and to share information with one another. The Web, a collection of information resources contained in documents located on individual computers around the world, is the most widely used and fastest-growing part of the Internet except perhaps for electronic mail ("e-mail"). See United States v. Microsoft, 147 F.3d 935, 939 (D.C.Cir.1998). Prevalent on the Web are multimedia "websites." A website consists of at least one, and often many interconnected, "web pages." Web pages are computer data files written in Hypertext Markup Language ("HTML") that contain information such as text, pictures, sounds, and audio and video recordings. Web pages also usually contain connections ("hyperlinks") to other web pages on the website and other websites altogether.

Each website has a corresponding domain name, which is an identifier somewhat analogous to a telephone number or street address. See Panavision Int'l, L.P. v. Toeppen, 141 F.3d 1316, 1318 (9th Cir.1998). Domain names consist of a second-level domain — simply a term or series of terms (e.g., a2zsolutions) — followed by a top-level domain, many of which describe the nature of the enterprise. Top-level domains include ".com" (commercial), ".edu" (educational), ".org" (non-profit and miscellaneous organizations), ".gov" (government), ".net" (networking provider), and ".mil" (military). See id. at 1318-19. Commercial entities generally use the ".com" top-level domain, which also serves as a catchall top-level domain. See id. A website's domain name (e.g., a2zsolutions.com) signifies its source of origin and is, therefore, an important signal to Internet users who are seeking to locate web resources. Because of the importance of a domain name in identifying the source of a website, many courts have held that the use of another's trademark within the domain name of a website can constitute a trademark violation. See, e.g., PACCAR Inc. v. Telescan Tech. LLC, 319 F.3d 243, 250 (6th Cir.2003) (citing cases).

Each web page within a website has a corresponding uniform resource locator ("URL") (e.g., a2zsolutions.com/desks/floor/laptraveler/dkfl-lt.htm), which consists of a domain name and a post-domain path. A post-domain path (e.g., /desks/floor/laptraveler/dkfl-lt.htm) merely shows how a website's data is organized within the host computer's files.

Using a web browser, such as Microsoft's Internet Explorer, a cyber "surfer" may navigate the Web — searching for, communicating with, and retrieving information from various websites. See Microsoft, 147 F.3d at 939-40, 950. A specific website is most easily located by entering its domain name into the browser. See Panavision, 141 F.3d at 1327. Upon entering a domain name into the web browser, the corresponding website's "homepage" will appear on the computer screen. Sometimes, however, a web surfer will not know the domain name of the site he seeks. In that case, the surfer has two principal options: to guess the domain name or utilize an Internet "search engine."

An Internet user will often begin by guessing the domain name, especially if there is an obvious domain name to try. Web users often correctly assume that the domain name of a particular company's website will be the company name followed by ".com." Guessing domain names, however, is not always successful. The web surfer who assumes that "X.com" will always correspond to the website of company X will sometimes be misled. See, e.g., Panavision, 141 F.3d at 1319 (finding that defendant's use of the website "panavision.com" to post photographs of the City of Pana, Illinois, violated the trademark rights of Panavision, International, L.P.)

A web surfer's second option when he does not know the domain name is to use an Internet search engine. When a keyword is entered, the search engine processes it to generate a (sometimes long) list of web pages (ideally relating to the entered keyword). Each search engine uses its own algorithm to search for and arrange web pages in sequence, so the list of web pages that any particular set of keywords will bring up may differ depending on the search engine used. See Niton Corp. v. Radiation Monitoring Devices, Inc., 27 F.Supp.2d 102, 104 (D.Mass.1998). Search engines usually look for keywords in places such as domain names, actual text on the web page, and metatags.³ Metatags are hidden HTML code intended to describe the contents of the web page. On many search engines, the more often a term appears in the metatags of a particular web page, the more likely it is that the web page will be "hit" in a search for that keyword and the higher on the list of "hits" the web page will appear. See Niton, 27 F.Supp.2d at 104.

II. BACKGROUND FACTS

The facts are largely undisputed. The principals in this case are Mark Comeaux, president of plaintiff Interactive Products Corporation ("IPC"), defendant Brian Lee, president of defendant a2z Mobile Office Solutions, Inc. ("a2z"), and defendant Douglas Mayer, president of defendant Mobile Office Enterprise, Inc. ("MOE"). Each of the parties in this case is involved in either the manufacture or sale of portable computer stands for use in automobiles. The portable computer stands provide a means to secure a laptop computer in a moving vehicle and yet provide availability and convenience of use from the driver's seat (hopefully while the car is at rest).

In 1994, Mayer and Comeaux co-founded IPC, through which they developed and sold a portable computer stand called the Lap Traveler. "Lap Traveler" is a federally registered trademark of IPC. Defendant a2z sells mobile computer accessories through its Internet website. Between 1996 and 1998, a2z sold the Lap Traveler on its website at the Internet URL "a2zsolutions.com/desks/floor/laptraveler/dkfl-lt.htm."

In 1998, Comeaux and Mayer had a disagreement, followed by a state court lawsuit in which Comeaux sought dissolution of IPC. In December 1998, Comeaux and Mayer entered into a settlement agreement to resolve Comeaux's dissolution petition. Under the settlement agreement, Comeaux agreed to purchase all of Mayer's shares of stock in IPC for $33,000. The agreement further provided that:

6. The parties agree that the right to use the "Lap Traveler" name and model designations, and the names and model designations of all other IPC products marketed at any time prior to the execution of the agreement, is and shall remain the exclusive property of IPC. Mayer ... shall have no right to use these product names or model designations.

7. Mayer, Comeaux, and IPC shall all have the right to manufacture, market and sell products similar to or identical to the Lap Traveler products currently marketed by IPC, including but not limited to the Lap Traveler.... Mayer shall not be entitled to use the Lap Traveler name or model designations in connection with such sales and marketing, although he and Comeaux shall each be entitled to claim that they were jointly the inventor of Lap Traveler products.

...

10. The parties shall be free to compete with one another in the future, including solicitation, marketing and sales to any current or future clients or business prospects of IPC without restriction. The parties shall be free to use any vendors, manufacturing suppliers and subcontractors,...