JK Harris operates at jkharris.com. The company sued Steven Kassel, who operates Taxes.com.
Part of the complaint was that Taxes.com used the trade name JK Harris excessively to create keyword density, to hijack web traffic seeking the JK Harris website. JK Harris counted 75 uses of its name on Taxes.com. The name also appeared in header tags, underline tags, keywords and links across the site. Sometimes the link text simply stated: “We Are NOT JK Harris – Visit Their Site Here.” JK Harris considered these to be search engine optimisation techniques.
JK Harris also presented evidence showing that consumers entering "JK Harris" into a search engine would find links to Taxes.com in the first page of results, in some cases above the link to jkharris.com.
But Taxes.com was also highly critical of JK Harris, criticising its business practices, linking from its homepage to an article about JK Harris being raided by the Internal Revenue Service, and publishing anonymous criticisms, ostensibly from dissatisfied customers.
JK Harris requested and won a preliminary injunction last year. The court agreed that Kassel's actions amounted to trade mark infringement and ordered that excessive references to JK Harris be removed from Taxes.com. However, Kassel has now convinced the court to narrow the scope of that injunction significantly.
The original decision was the first of its kind as it ordered the removal of overt references to a competitor's name from the primary site content. It was hailed at the time as "revolutionary" by a lawyer representing JK Harris as it appeared to extend previous US decisions where removal of hidden references had been ordered in cases concerning abuse of meta tags, the hidden HTML code read by some search engines to identify the content of web pages.
While the order was largely reversed, the court left open the possibility that keyword density abuse could infringe a trade mark. The key to yesterday's ruling is that Kassel's site was not making gratuitous use of the JK Harris trade mark.
Yesterday's decision focused on a three-part test for permissible unauthorised use of an undisputed trade mark. The test was established in a trade mark case brought by former boy-band New Kids on the Block against newspapers for promoting, among other things, a "which kid is the sexiest?" phone poll.
The test allows the unauthorised use of the trade mark under US law if:
It was ruled that Kassel's use of the mark clearly satisfied parts 1 and 3 of the test as, realistically, JK Harris could only be identified though its name and there was no suggestion of sponsorship.
Part 2 of the test was "a closer question," in Judge Claudia Wilken's view. There were clearly a substantial number of references to JK Harris on Taxes.com – and JK Harris claimed that the mark had been used in a manner designed to call attention to it.
But Judge Wilken decided that the name was not used gratuitously.
Rather, it was used "in order to make statements about it." Criticising JK Harris was one of the primary objectives of Taxes.com – which justified making the name visually obvious. If the trade mark could not be used in this way for fear of trade mark infringement, reasoned Judge Wilken, then it would be all but impossible to engage in useful comment on the company.
Accordingly, the New Kids test was passed – and JK Harris was no longer entitled to a preliminary injunction limiting Kassel's use of the JK Harris trade name.
Only a minor part of the injunction remains: some third party statements on Taxes.com allegedly defamed JK Harris and there was no admissible evidence that they were true. These are now banned as amounting to false and misleading advertising.