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Sept. 17 — Blog posts created solely for search engine optimization and not intended to be read by the public didn't constitute “advertising,” the U.S. District Court for the District of Colorado held Sept. 15.
Judge Marcia S. Krieger said that even though the blog posts were promotional in nature, there was no evidence the posts reached more than an incidental number of consumers.
The case is a victory for online marketers using search engine optimization tactics that would be questionable in pure advertising, as their efforts don't fall within federal prohibitions on false advertising.
The court also found that a disparaging domain name, operated by a competitor, wasn't confusingly similar to the company's trademarked name despite incorporating that name.
Commercial advertising under the Lanham Act, 15 U.S.C. § 1125(a), requires four elements: (1) commercial speech, (2) made by or on behalf of a competitor of the complaining party, (3) for the purpose of influencing consumers to buy that competitor's goods or services and (4) sufficiently disseminated to the purchasing public to constitute advertising or promotion in the relevant industry.
Plaintiff General Steel Domestic Sales LLC and defendant Armstrong Steel Corp. have been engaged in a long-running dispute over the companies' respective advertising practices. As part of its marketing, General hired a search optimization firm and gave it broad discretion to promote the company's brand. The firm's efforts included creating blog posts resembling news items or testimonials for General's products. The posts linked back to General's main website as part of an effort to boost that website's standing in search engine results listings.
General and Armstrong brought a variety of false advertising and related claims against one another. Armstrong claimed, among other things, that General's blog posts made false factual claims about General's history and said General was a steel manufacturer when it actually only sells pre-fabricated products. General moved for summary judgment, saying the posts weren't advertising under the Lanham Act.
General's claims included a violation of the Anticybersquatting Consumer Protection Act, 15 U.S.C. § 1125(d), for Armstrong's registration of generalsteelscam.com. Armstrong also moved for summary judgment.
The court found the blog posts weren't sufficiently disseminated to the public to constitute advertising, as the number of visitors to the posts was “incidental,” and it wasn't clear those visitors were potential customers. The site visitors could've ended up on the sites through coincidental search for a person with a similar name or by searching for words that appeared in the testimonial content by happenstance. For instance, one of the testimonials referred off-hand to a naval battleship also built with General Steel, so people searching for “battleship” might have ended up on the posts.
The court positively cited Sports Unlimited Inc. v. Lankford Enter. Inc., 275 F.3d 996 (10th Cir. 2002), in which a flooring company created a document with false negative testimonials about a competitor for a project architect and contractor. The court found there that giving information to two individuals wasn't sufficient dissemination to constitute false advertising.
Armstrong argued that in Lanham Act cases in which an advertisement is literally false, deception is presumed. The court said Armstrong was correct, but didn't ask the wrong question — whether the material was an advertisement at all, which was a necessary threshold before addressing the issue of deception.
Although irrelevant to the result, the court did find that the blog posts satisfied the third element for advertising, that it was created for the purpose of influencing customers to buy the company's products. The posts were designed to positively influence algorithms to reflect favorable comments about General. Filtering it through an algorithm, the court said, didn't remove its promotional effect.
The court also dismissed General Steel's cybersquatting claim over the generalsteelscam.com domain name, following “the general trend in the U.S. courts that decline to find disparaging domain names to be confusingly similar to the marks they incorporate.” Although General had prevailed in a Uniform Domain Name Dispute Resolution Policy (UDRP) determination regarding the name, the court said the World Intellectual Property Organization's UDRP decisions are given no deference under the ACPA, referring to WIPO proceedings as “adjudication lite” with “loose rules regarding applicable law.”
Wilson Elser Moskowitz Edelman & Dicker LLP represented General Steel. Wheeler Trigg O'Donnell LLP represented Armstrong Steel.
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