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District Court Refuses to Dismiss Facebook's Trademark Claims Alleging Social Networking Site Traded Off the Fame of the FACEBOOK Marks

Thursday, September 29, 2011

Jennifer Gaeta | Bloomberg Law Facebook, Inc. v. LLC, No. 11-CV-03052, 2011 BL 245033 (N.D. Ill. Sept. 26, 2011) The U.S. District Court for the Northern District of Illinois denied defendant LLC's motion to dismiss plaintiff Facebook, Inc.'s complaint alleging trademark infringement, dilution, and related federal and state claims finding that Facebook adequately pleaded its claims.

Facebook Alleges Defendant's Mark is Substantially Similar to FACEBOOK Mark

Facebook has maintained a popular social networking website since 2004. Teachbook also maintains a social networking website that targets teachers. In its complaint, Facebook claimed that Teachbook infringed its FACEBOOK and related trademarks by using the TEACHBOOK mark on a website touted as a Facebook alternative. Facebook asserted that the Teachbook site contained the following text at various times:
Many schools forbid their teachers to maintain Facebook and MySpace accounts because of the danger that students might learn personal information about their teachers. With Teachbook, you can manage your profile so that only other teachers and/or school administrators can see your personal information, blogs, posts, and so on. Teachbook is all about community, utility, and communication for teachers.
Facebook at 2-3. Teachbook also filed an intent-to-use application with the U.S. Patent and Trademark Office ("USPTO") to register its TEACHBOOK mark, which Facebook opposed. Facebook filed the instant action alleging that the TEACHBOOK mark is substantially similar to the FACEBOOK mark and that Teachbook also "creates a false suggestion of an affiliation or connection between [Teachbook] and Facebook, where none exists." Id. at 3. Facebook further argued that Teachbook "adopted its TEACHBOOK Mark with the intention of causing confusion with, and trading on the goodwill of, the FACEBOOK Marks."Id.

Court Refuses to Consider Additional Documents

The court explained that a motion to dismiss is generally confined to the pleadings, which, in the instant case, included a 15-page complaint with five exhibits. Teachbook, however, submitted 300 pages of additional material that it asked the court to consider. Teachbook asserted that these materials could be considered at this stage of the litigation because they were either referenced in Facebook's complaint or were public records. The documents included a filing Facebook made with the European trademark authority in response to objections raised by the Spanish holder of the FACTBOOK trademark. The court, however, would not take judicial notice of this document for the purposes of the motion to dismiss because that dispute involved a different factual and legal context. And while Teachbook may be able to later point to this filing as evidence, the court found that it could not do so at the current juncture. The court made the same determination as to the other documents, which consisted of USPTO documents and dictionary definitions. The court additionally determined that certain documents Teachbook claimed were referenced in Facebook's complaint were not central to Facebook's claims. Accordingly, the court did not consider any of these additional documents and confined the motion to the alleged facts set forth in Facebook's complaint and the accompanying exhibits.

Court Denies Motion to Dismiss

TeachBook moved to dismiss the complaint for two reasons. First, Teachbook asserted that the only thing in common between the two marks is the "book" suffix, which is generic and not entitled to trademark protection. Second, Teachbook claimed that Facebook failed to allege that there was a likelihood of confusion. — Genericness Teachbook contended that the commonality between the two marks was limited to the "book" suffix and that this component was generic. Facebook asserted that its complaint was based upon its registered FACEBOOK trademark in its entirety. The court agreed with Facebook and determined that it was not appropriate to splice up the mark into two components at this stage in the litigation.
Indeed, upon initial reading, nothing about the two component parts of the FACEBOOK mark makes one more salient than the other. Rather, it is the aggregate effect of the conjoined parts that gives the mark its distinctiveness. And given the ubiquity Facebook claims its mark has achieved, one could reasonably infer that the choice of the TEACHBOOK mark — which, like the FACEBOOK mark, is a curt, two-syllable conjunction of otherwise unremarkable words — to offer a similar service in the same medium was no accident.
Facebook at 18. The court further explained that even if it were to focus on the "book" component, "book" was not generic for a social network website. Finally, the court explained that because Facebook has registered trademarks, at this stage of the proceeding, it is entitled to the presumption that its marks are not generic. — Likelihood of Confusion The court analyzed the applicable likelihood of confusion factors by first addressing the similarity between the marks. Teachbook argued that the complaint could be dismissed if the marks are visually dissimilar. The court, however, disagreed and found that Facebook adequately pleaded similarity, explaining that Facebook asserted that the marks were highly similar in "appearance, sound, meaning, and commercial impression" and that this pointed to the "textual and aural similarities between the marks." Facebook at 24-25. The court found these similarities to be obvious in that both marks contained the "book" suffix in conjunction with a mundane, monosyllabic word. The court further reasoned that the differences pointed out by Teachbook, including the font color and style would matter less when these marks are seen in the actual marketplace. Thus, the court found that Facebook had adequately pleaded similarity of the marks. Teachbook also criticized Facebook for its failure to plead actual confusion, based on the fact that Facebook has an "enormous and loyal user base." Id. at 25. However, the court noted that the absence of actual confusion is not fatal to a trademark claim. Finally, Teachbook alleged that Facebook did not properly allege an intent to "palm off" its website. In fact, Teachbook pointed to the fact that it distinguishes itself from Facebook and MySpace in the text of its website. The court explained, however, that Facebook had pleaded intent when it pleaded that its mark was famous and that Teachbook adopted its mark with knowledge of the FACEBOOK marks. "Furthermore, who is to say these teachers might not think that Teachbook is Facebook's response to some schools banning teachers from using Facebook?" Id. at 29. Moreover, "[i]n light of such policies, a reasonable consumer might assume that Facebook was offering social networking services targeted specifically at teachers and addressing the privacy concerns at which the schools' policies are apparently aimed." Id. As to the other factors, the court explained that Facebook also alleged that the parties are offering similar products, and that Teachbook has touted that it’s a "substitute for Facebook." Id. at 30. Facebook further contended that both products are offered in the same channel of trade, the Internet, and that its marks are famous. Thus, the court found that Facebook had pleaded five of the seven likelihood of confusion factors, and this was enough to plead a trademark infringement claim. — Trademark Dilution Teachbook had argued that Facebook was required to plead confusing similarity between the marks to adequately allege a claim for dilution. The court stated that this was incorrect and that Facebook adequately pleaded this claim as an alternative to trademark infringement by pleading that its marks are famous and that Teachbook's mark "impairs the distinctiveness" of its marks. Facebook at 33. Accordingly, the court found that Facebook had adequately pleaded its dilution claim and denied Teachbook's motion on all counts. Disclaimer This document and any discussions set forth herein are for informational purposes only, and should not be construed as legal advice, which has to be addressed to particular facts and circumstances involved in any given situation. Review or use of the document and any discussions does not create an attorney-client relationship with the author or publisher. To the extent that this document may contain suggested provisions, they will require modification to suit a particular transaction, jurisdiction or situation. Please consult with an attorney with the appropriate level of experience if you have any questions. Any tax information contained in the document or discussions is not intended to be used, and cannot be used, for purposes of avoiding penalties imposed under the United States Internal Revenue Code. Any opinions expressed are those of the author. The Bureau of National Affairs, Inc. and its affiliated entities do not take responsibility for the content in this document or discussions and do not make any representation or warranty as to their completeness or accuracy. ©2014 The Bureau of National Affairs, Inc. All rights reserved. Bloomberg Law Reports ® is a registered trademark and service mark of The Bureau of National Affairs, Inc.

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