Facebook fans claimed as damages in an infringement suit?

March 10, 2011

social media graphicFacebook is quickly becoming a prime target for entrepreneurs looking to expand their client base.

It seems only natural, then, that as more and more businesses compete on Facebook for customers or potential customers, the number of conflicts between them also increase.

A complaint was just filed in federal court in New York concerning such a conflict.

The case involves two spa businesses operating on the opposite ends of the country, and Facebook, who the plaintiff also named as a necessary defendant.

It’s a basic trademark infringement case with an extra twist: the internet is involved.

That’s only really significant here because traditionally, in determining the “likelihood of confusion,” an essential test to determine whether trademark infringement has indeed occurred, geographical proximity is a significant factor.

The added rub in internet cases is perfectly exemplified here: the two services are extremely similar and have identical names (Complexions), but are located on the opposite ends of the country, and cater to clients nearly exclusively in their respective geographic areas.

If it weren’t for the internet, these two businesses would not have bumped heads unless one of them expanded to the other side of the country. Even if that ever were to happen, the complaint itself states that there are at least 24 other salons and spas within the U.S. named “Complexion,” so it’s unlikely that any particular spa would be able to claim an exclusive trademark.

Furthermore, since the parties are located such a distance from one another, and given the nature of the services offered by the spas, it is unlikely that a little internet toe-stepping has had any impact on either’s business.  The complaint even states as much.

So what is the fight even about?

In short, Facebook.

The complaint alleges that in January 2011, the defendant notified Facebook that plaintiff had violated plaintiff’s copyright (obviously, defendant meant trademark).

It is the standard policy with nearly all websites to err on the side of removing potentially infringing content lest the host site get nailed with the same lawsuit.  So, of course, Facebook removed the plaintiff’s Facebook page, and all of the plaintiff’s 1,000+ fans were lost with it.

The plaintiff wants the court declare its non-infringement, and then to force Facebook to put everything back the way it was (specifically, the spa’s Facebook page with fans and all).

Although, as Eric Goldman discusses in great detail in his blog post on this same case, this relief is unavailable to the plaintiff because courts simply cannot force someone to publish something (if the First Amendment grounds aren’t good enough, Congress has specifically legislated to this point).

And maybe the plaintiff foresaw this and tacked on the false advertising/deceptive trade practices claim at the end. In my opinion, it seems a bit flimsy because the defendants can make a pretty strong argument that they were simply trying to recapture fans lost to what they believed in good faith to be the plaintiff’s wrongful use of their trademark.  Additionally, the plaintiff would have a hard time showing any deception beyond circumstantial evidence.

At any rate, this case demonstrates the increasing financial importance of social media and the importance of developing case law to deal with conflicts such as these.