descriptive fair use defeats counterfeiting claim (on PI motion)

Freelancer Int’l Pty
Ltd. v. Upwork Global, Inc., 2020 WL 6271030, No. 20-cv-06132-SI (N.D. Cal.
Oct. 23, 2020)

The parties compete
in offering “software platforms matching freelancers with freelancing jobs.” Plaintiff
Freelancer Tech has standard character mark registrations for FREELANCER for,
inter alia, computer software for personal information management; computer
software for accessing, browsing and searching online databases; computer
software for identifying, locating, grouping, distributing, and managing data
and links between computer servers and users connected to electronic
communications networks; online retail store services featuring computer
software; and online social networking services. (I have omitted some of the
claimed goods/services.) The registrations are incontestable.

But Tech was also
refused registration on descriptiveness grounds for “online business
directories in the field of employment; providing a website allowing users to
post messages offering or seeking job opportunities; providing online project
management services for others for business purposes in the field of
scheduling, accounting, business project management and business development,
providing an on-line searchable database featuring classified ad listings and
employment opportunities”, “Providing on-line electronic bulletin boards for
transmission of messages among computer users concerning job opportunities”,
and another list that was more clearly employment-related than the successful
registrations.

Meanwhile, defendants
have a registration for UPWORK and provide two Upwork-branded mobile apps, as shown
in Apple and Google’s app stores:

 

One app is meant for
use by clients, titled “Upwork for Clients,” while the other app with a
reversed color scheme is meant for use by freelancers, titled “Upwork for
Freelancers.” The latter app has been downloaded nearly three million times since
2019. Plaintiffs didn’t object to use of the term “Upwork for Freelancers.” But,
on devices, the display name listed beneath the app’s “Up” logo icon is
“Freelancer” on iOS devices and “Freelancer-Upwork” on Android devices. Plaintiffs
also objected to app notifications allegedly using the “Freelancer” mark. Comparison
of the parties’ apps as they display on devices (iOS on left, Android on
right):

 

The court denied a
preliminary injunction on infringement and counterfeiting claims. And here we
have an important application of the Ninth Circuit’s recent counterfeiting
ruling: plaintiffs can’t bootstrap the counterfeiting allegations (same mark/same services aka double identity) into a
finding of infringement without showing likely confusion. Arcona, Inc. v.
Farmacy Beauty, Ltd. Liab. Co., No. 19-55586 (9th Cir. Oct. 1, 2020). [Note that doesn’t completely answer the question of the descriptive fair use/counterfeiting issue because, as the court noted, descriptive fair use can be available even where there is confusion, but it also seems implausible that a descriptive fair use should be deemed counterfeit, which is why “use as a mark” is such a useful concept.]

So, confusion: The
court focused on descriptive fair use, and only analyzed the “use as a mark” element. Plaintiffs argued that they were only
challenging instances in which Upwork used “Freelancer” as a mark, but didn’t
show that the challenged uses were uses as a mark. “To determine whether
a term is being used as a mark, we look for indications that the term is being
used to ‘associate it with a manufacturer.’ ” At least two factors are
relevant: (1) “whether the term is used as a symbol to attract public
attention, which can be demonstrated by the lettering, type style, size and
visual placement and prominence of the challenged words”; and (2) “whether the
allegedly infringing user undertook precautionary measures such as labeling or
other devices designed to minimize the risk that the term will be understood in
its trademark sense.”

The key arguments
around use as a mark involved (1) defendants’ app display names: “Freelancer”
on iOS devices and “Freelancer-Upwork” on Android devices; (2) when defendants’
app states “This is a Freelancer account” instead of for example “This is an
Upwork account for freelancers”; and (3) when defendants’ software prompts the
user that “ ‘Freelancer’ Would Like to Send You Notifications”; and (4) a
document that encouraged freelancers on the Upwork app to migrate to Upwork’s
new app meant for freelancers. Plaintiffs also argued that capitalization of
Freelancer showed use as a mark.

The court disagreed.
These were all “proper and descriptive uses of a common word distinguishing
Upwork’s freelancer app from its client app.” Bold font and a capital letter
were insufficient, “especially when Upwork’s distinctive lime green logo or
coloring is placed directly alongside the various notifications.” Defendants
never claimed Freelancer as a mark, used a stylized font for it, or used a TM
symbol for it.

Separately,
plaintiffs didn’t show irreparable harm. They estimated that “up to as many as
1,800 users per day or 56,000 users per month” were diverted, but didn’t
convince the court that any diversion was based on app display names shown
post-download, especially given the “distinctively different logos.” The court
noted that “the disputed titles only become apparent after a user makes a
conscious decision to download the apps,” and plaintiffs didn’t object to the
app store displays. Nor would post-download notifications cause irreparable
harm, since they occurred only after that same conscious decision.

from Blogger https://ift.tt/35MPZOI

This entry was posted in Uncategorized and tagged . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s