AOL owns trademark registrations covering various stylized representations of the mark “ADVERTISING.COM.” On August 17, 2009, AOL filed a complaint against Advertise.com, followed by a motion for a preliminary injunction, alleging that the Advertise.com domain and name were infringing upon the ADVERTISING.COM mark held by AOL. The district court granted AOL’s motion for a preliminary injunction and enjoined Advertise.com from using “any design mark or logo that is confusingly similar to the stylized forms of AOL’s ADVERTISING.COM marks” and from using the designation and trade name Advertise.com, but not from using the existing domain. The district court’s decision was based upon a finding that AOL was likely to show that the ADVERTISING.COM marks are descriptive and therefore protectable under trademark law. Advertise.com appealed the decision and the grant of the preliminary injunction with an argument that AOL’s marks are generic; the Court of Appeals agreed with Advertise.com and reversed the lower court’s decision and vacated the preliminary injunction.

Because ADVERTISING.COM is a registered trademark, there is “a presumption of validity,” which “places the burden of proving genericness upon the defendant,” Advertise.com. Filipino Yellow Pages, Inc. v. Asian Journal Publ’ns Inc., 198 F.3d 1143, 1146 (9th Cir. 1999). In order to show that the associated marks are generic, Advertise.com is required to show that the terms refer to “the genus of which the particular product or service is a species,” i.e., the name of the product or service itself. The services offered by AOL under the ADVERTISING.Com marks are (1) developing relationship with web publisher for the placement of third-party ads on publisher’s sites, and (2) selling online advertising space and marketing campaigns to web marketers. According to the court, “advertise” is concededly generic and the term “.com” refers generically to an online organization or any internet component of an existing business. The two components of AOL’s marks therefore are generic by themselves. While two generic terms brought together may create a distinctive mark, the court went on to find that this was not the case for AOL after applying the “who-are-you/what-are-you” test.

A valid and protectable trademark answers the buyer’s questions “Who are you?” and “Where do you come from?” Alternatively, a generic mark answers the question “What are you?” In applying this test the court determined that AOL’s marks were largely generic. If any of AOL’s competitors

Predictably, Hallmark dragged out the usual defenses, namely, the First Amendment’s protection of free speech. Included among the usual suspects of defenses was an interesting move. A move to strike Hilton’s misappropriation claim based on California’s Anti-SLAPP laws (CCP § 425.16). The Anti-SLAPP law (found <a href=”http://casp.net/statutes/cal425.html“><u>here</u></a>) moves to prevent intimidation and the silencing of critics by use of the courts and burdensome and expensive litigation. Said simply, Anti-SLAPP is a move by the California Legislature to protect people’s freedom of speech from unnecessary litigation.

Hilton argued that (well her lawyers argued) the card itself was commercial speech and thus only allowed minimal protection. Hallmark countered saying it was free speech, satirizing Hilton. The court sided with Hallmark, further stating commercial speech is speech merely advertising or soliciting business and not, as Hilton would argue, anything connected to the product of that company.

Although Hallmark met the threshold for Anti-SLAPP protection, Hilton was still allowed to go forth with her misappropriation claim. Although Hallmark’s free speech is the source of Hilton’s suit, as long as she can sustain a legal claim she cannot be prevented from suing Hallmark on her misappropriation claim.

The court further said, “”We must conclude that Hallmark cannot employ the ‘public interest’ defense because its birthday card does not publish or report information.”

The case has now been handed down for trial.