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Second Circuit Finds No Trademark Infringement in Targeted Internet Advertising Case

By Kyle-Beth Hilfer

On June 27, 2005, the Second Circuit overturned a lower court's determination that an Internet advertising company's delivery of targeted, contextually relevant pop-up ads constituted trademark infringement. The plaintiff, 1-800 Contacts, Inc. (“1-800″), sued WhenU.com (“WhenU”) for trademark infringement as well as multiple other federal copyright, state infringement, and common law claims. The Second Circuit limited its review of the case to the plaintiff's Lanham Act claim, remanding the rest of 1-800's claims back to the district court.

Plaintiff 1-800 is a distributor of contact lenses and has a Web site located at www.1800contacts.com, as well as registered service marks for “1-800CONTACTS.” Defendant WhenU is an Internet advertising company that, by means of proprietary software, monitors a computer user's (“C-user”) activity on the Internet and causes pop-up ads related to the C-user's activity to appear on the C-user's desktop. The C-user voluntarily opts to use WhenU's system by downloading WhenU's software to monitor specified browsers.

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