blog posts on company’s site are “commercial advertising or promotion” under Lanham Act

Luminati Networks
Ltd. v. BIScience Inc., 2019 WL 2084426, No. 18-CV-00483-JRG (E.D. Tex. May 13,
Mostly a
jurisdictional challenge; the court found it had specific personal jurisdiction
over Luminati’s claims for patent infringement and false advertising and
supplemental jurisdiction over the remainder of Luminati’s claims, though it
declined to exercise supplemental jurisdiction over Luminati’s claim for
tortious interference with employment agreements, “as determination of that
claim is best left to the judicial authority of the State of Israel.” There was
personal jurisdiction because BIScience has sold its allegedly patent-infringing
proxy service to at least 52 customers in Texas, and its service allowed
customers all over the world to utilize residential proxy devices in ten Texas
cities, which BIScience advertised (at least in terms of allowing them to use
US addresses).
sufficiently alleged the falsity of blog posts on BIScience’s website stating:
“Some proxy providers look great and fancy until you try to integrate them.
Some—such as Luminati—are very difficult to integrate, as they require you to
install complex proxy managers and to ultimately modify your entire solution.” Luminati
sufficiently alleged falsity by alleging that its residential proxy service didn’t
require installation of Luminati’s proxy manager.

BIScience argued that a blog post on its own site wasn’t “commercial
advertising or promotion.” Yes, they were. 
The blog posts were commercial speech by a company in commercial
competition with Luminati, made for the purpose of influencing customers to use
BIScience’s GeoSurf service. Shortly after the statements at issue, the blog
posts continue: “In short, stay away from these proxies. Instead, go for
easy-integration proxies that support whatever your needs may be. GeoSurf, for
instance, takes less than 5 minutes to integrate….” Moreover, “while company
blog posts may not be traditional ads, they are a quintessential type of
informal promotion.” BIScience allegedly purchased search engine ads for terms
like “luminati” so that potential customers would be directed to its
website.  “Thus, Luminati has alleged
that these blog posts are disseminated sufficiently to the relevant purchasing
public.” [Note an emerging divergence on this: some courts would want evidence
that lots of people landed on the blog posts, which I think is probably an
issue of damages rather than “commercial advertising or promotion”; it’s still
an ad even if everyone successfully avoids reading it.]

from Blogger

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