On April 7, 2008, in North American Medical Corp. v. Axiom Worldwide, Inc., the Federal Court of Appeals for the 11th Circuit Court (with jurisdiction over Alabama, Florida and Georgia), ruled that using another’s trademark in metatags infringes the Lanham Trademark Act.  There is a split of authority regarding trademark infringement by the use of search engine key words and metatags.  This decision followed the reasoning of the 9th Circuit in Brookfield Communications, Inc. v. West Coast Entertainment Corp., along with a majority of other circuits (with the 2nd Circuit being an exception), in holding that the use of another’s trademark(s) in metatags and keywords is a “use in commerce” and may result in trademark infringement.

The defendants in North American Medical attempted to argue that the 11th Circuit should follow the 2nd Circuit’s line of cases holding that placing a competitor’s trademarks within metatags does not constitute a “use in commerce” as required to find trademark infringement under the Lanham Act.  The 11th Circuit, however, found the 2nd Circuit’s analysis questionable and followed the majority of other circuits holding that using another’s trademark in metatags or keywords is a “use, that is, a use in connection with the sale or advertisement of goods.”  Id.  Accordingly, unless the case is brought in the 2nd Circuit (with jurisdiction over New York, Connecticut and Vermont) where such a claim is not likely to succeed, the use of another’s trademark(s) in metatags and keywords is most likely a “use in commerce” and the only question left to decide is whether there is a likelihood of confusion.

The North American Medical Court emphasized, however, that its finding of infringement was narrow and only applicable to the set of facts before them where a likelihood of source confusion was actually found.  In North American Medical, when consumers entered plaintiff’s trademarks into a search engine, the search engine results not only displayed defendant’s competing website, but they also included a brief description of defendant’s website, which description included and highlighted plaintiff’s trademarked terms, thereby suggesting a relationship between plaintiff and defendant.  Thus, the 11th Circuit apparently narrowed its holding from the Brookfield case, wherein the 9th Circuit found a likelihood of confusion even though there was no likelihood of source confusion.  Rather, the 9th Circuit believed that initial interest confusion could be found in the sense that, by using another’s trademark in metatags to divert people looking for the plaintiff’s website, the competitor improperly benefits from the good will that the plaintiff had developed in its mark.  With respect to keywords, the 9th Circuit has suggested a more narrow approach in the factual situation of consumers viewing an ad “clearly labeled” as an ad for the defendant, however, this factual situation has not yet come before the 9th Circuit.

Although the tests for determining whether a “likelihood of confusion” exists differ slightly among the circuits and depending whether the trademarks were used in metatags or keyword searches, the cases are becoming clearer that unless a litigation is brought in the 2nd Circuit, a company may be found liable for trademark infringement for using another’s trademarks in its metatags or in keyword searches.  Nevertheless, there remains a significant split among the circuits which must be considered when selecting a venue and which may one day require a Supreme Court decision to unify the Circuits.