impersonating company to solicit intimate images for private use isn’t TM infringement/false advertising

AdoreMe, Inc. v. Watson, 2020 WL 5769083, No. CV 19-8830 FMO
(AGRx) (C.D. Cal. Jul. 14, 2020)

A fundamentally commercial cause of action can be a bad tool
to address even bad noncommercial behavior. AdoreMe sued Watson for trademark
infringement and false advertising under federal and state law, and an unfair
business practices claim under state law. Watson, who failed to respond,
allegedly operates a phishing scam through which he “preys on unsuspecting
women by (a) posing as a talent scout for Adore Me; (b) impersonating Lindsey
Hayes Kroeger (‘Ms. Kroeger’) – a well-respected talent scout – and/or
pretending to be affiliated with her; and (c) using, unlawfully and without
authorization, Adore Me’s name, trademark, and reputation to obtain nude and
intimate photographs from women.”

AdoreMe sought default judgment, which the court denied.
Even where well-pled allegations exist, “[t]he district court’s decision
whether to enter a default judgment is a discretionary one,” considering
factors including the merits of plaintiff’s substantive claim and the
sufficiency of the complaint.

Trademark infringement requires use “‘in commerce’ and ‘in
connection with the sale, offering for sale, distribution, or advertising of
any goods or services.’ ” (Citing cases that “noncommercial” uses don’t trigger
the Lanham Act.) The court found that AdoreMe’s allegations of commercial use
were conclusory and insufficient to state a claim.

[Query whether false advertising precedents could have been
any help: although offering goods/services without intent to sell them as
advertised is false advertising, that’s essentially always coupled with actual
sales of something else—bait and switch. Advertising something without the
intent to provide any services at all may not be the requisite “advertising,”
though courts have stretched the definition of use in commerce/commercial use
so far already that this seems like an odd place to stop. Indeed, one could
create a category of “fake commercial speech” and treat the defendant as engaged
in “advertising” of services while still robustly protecting ordinary noncommercial
speech.]

Likewise, the allegations that “Defendant has profited and
will continue to profit from his unlawful actions because the intimate
photographs of his victims are highly valuable and the private property of
those women” didn’t allege facts showing actual profit/plans to profit
(implicitly defined as profit monetarily). [Side note: under California
right of publicity law, the benefit to the defendant doesn’t have to be
commercial; Kroeger’s potential claims are easily the strongest here.]

So too with the Lanham Act false advertising claims. This
wasn’t plausibly “commercial advertising or promotion.” [Again, I might have attempted
to estop defendant from challenging commerciality, but that is innovation and I
can easily see why the court didn’t want to do that on a default judgment,
where it’s easy to make bad law.]

The state claims were the same. [I wonder whether you could
get something useful out of UCL “unfairness.” This seems like the kind of conduct
the FTC thinks is unfair.]

Finally, the court was skeptical of the sufficiency of the
support for plaintiff’s damages claims. “To recover damages after securing a
default judgment, a plaintiff must prove the relief it seeks through testimony
or written affidavit.” AdoreMe submitted only the declaration of its General
Counsel, which didn’t sufficiently establish her qualifications and competency
to assess and calculate AdoreMe’s damages. She also relied on potentially
inadmissible evidence, e.g., supporting the statement that “approximately 1% of
people who visit a company’s social media will ultimately make a purchase on
the company’s platform” with a citation to a link to a website “upon which the
court has no basis to rely.”

The court told AdoreMe to file an amended complaint and move
for default judgment quickly or have the case dismissed; to consider retaining
an expert to substantiate its damages calculations; and to consider limiting its claims. Given these instructions, it’s not incredibly surprising
that AdoreMe apparently instead abandoned the lawsuit. One hopes that social
media companies will nonetheless cooperate with shutting down such schemes.  

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