Using someone else’s trademarks for marketing purposes can pose legal risks for affiliates. Many trademark owners claim that such use is prohibited. However, it is not that simple. Affiliates can use another’s trademarks under certain conditions.
The central issue is whether the trademark use is likely to confuse consumers into believing that the trademark user is related to or authorized by the trademark owner. If the use is likely to cause confusion, the use is prohibited.
Put another way, an affiliate can use another’s trademark in a keyword, metatag or Web site content if that use is not likely to cause confusion.
Even if there is no likelihood of confusion, there are limits. Under the legal doctrine known as “nominative fair use,” an affiliate can use another’s trademark only if (i) the trademark owner’s product or service cannot be readily identified without the use of the trademark; and (ii) the trademark is used only to the extent necessary to identify the trademarked product or service.
An affiliate must also have a good faith reason to be using the trademark. For example, an affiliate can purchase the trademark as a keyword or place it an email if the affiliate is offering the genuine trademarked product.
They can also use a trademark to make a legitimate comparison to the trademarked product or to inform consumers that a merchant is offering a generic version of that product.
On the other hand, if the affiliate is not offering the trademarked product and either purchases the trademark as a keyword in order to drive traffic to their Web site or uses it in Web site content in order to obtain an organic listing that use will likely be problematic.
When affiliates find themselves on the wrong side of a cease and desist letter, it is often because the limits of nominative fair use have been exceeded. This frequently happens when an affiliate calls undue attention to the trademark.
For example, nominative fair use only permits the use of a trademark in block letters. Using a trademark in its stylized logo form or in font that is more prominent than the surrounding text is impermissible. Gift card offers are often problematic.
While it may be permissible for an affiliate to offer a Starbucks gift card, the bounds of fair use are exceeded if the affiliate uses an image of an actual Starbucks gift card (which may also constitute copyright infringement) or displays a mock gift card with the word Starbucks in a large and/or bold font.
Similarly, a permitted use of a trademark can become infringing when the trademark is used with text which creates the impression that the trademark owner authorized or is sponsoring the affiliate’s offer.
While this may simply be a result of sloppy drafting, for trademark infringement liability, intent is irrelevant. All that matters is whether there is a likelihood of confusion.
By using another’s trademarks for the right reason and in a proper manner, you can avoid trademark disputes.
Mark J. Rosenberg is an attorney with Sills Cummis & Gross P.C. in New York City and can be reached at 212-643-7000.
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Thanks Mark – this has been a question we have been looking into for some PPC campaigns lately. Appreciate the clarification. Would be helpful to see some visuals of permissible and non-permissible uses in ads. Does anyone have a link to something like that?