Yahoo Must Face Parts.com Trademark Complaint
The online retailer Parts.com may continue to pursue a lawsuit against Yahoo centering on the company's paid-search practices, a federal judge has ruled.
The retailer, which sells car parts, argues that its trademark in the name "parts.com” is infringed when other companies that sell replacement parts use the phrase “parts.com” to trigger search ads. “Even if users realize that a given website is not affiliated with Parts.com, once users reach the third party advertiser’s website while intending to shop for parts.com ... confusion has occurred and the damage to Parts.com is done,” the company alleged in its complaint against Yahoo. “Many consumers or users are likely either to stay at the third party advertiser’s website or to stop searching for Parts.com’s website.”
Last week, U.S. District Court Judge Janis Sammartino in the Southern District of California rejected Yahoo's bid to dismiss the lawsuit at an early stage. Among other arguments, Yahoo said that “parts” was a generic term, and that consumers who type the word into search engines aren't confused by listings from multiple retailers.
But Sammartino ruled that Yahoo's argument was premature. She ruled that whether Yahoo's search results page “presents a likelihood of confusion for consumers is a question of fact best resolved at a later stage in this litigation.”
Parts.com also brought a similar lawsuit against Google earlier this year. Sammartino dismissed that lawsuit last week, ruling that the retailer waited too long to sue. Parts.com complained to Google in 2007 about the alleged trademark infringement, but didn't sue until this May. Sammartino's dismissal “without prejudice,” meaning that Parts.com theoretically can attempt to file again, if it can offer a good reason why its claim should be considered timely.
Santa Clara University law professor Eric Goldman notes that
Parts.com's lawsuit could backfire on the company, given that “parts” is a common name.
“Parts.com is a terrible trademark, about as protectable as Pets.com (which trademark lawyers often use as a prime example of a completely un-trademarkable phrase),” Goldman wrote when the company filed suit. “If Parts.com doesn’t voluntarily drop this lawsuit (a surprisingly common outcome for AdWords challengers), I predict Parts.com ends this lawsuit with an invalidated trademark.”