1-800 Contacts.com, Inc. v. Memorial Eye, P.A., 2010 WL 5149269 (D. Utah Dec. 13, 2010)

Incontestable Trademark Newsletter - January 2011

ABSTRACT

Defendant purchased keywords incorporating plaintiff's 1-800 CONTACTS trademark that linked to sponsored advertisements for defendant's competing products, and plaintiff sued for trademark infringement. Defendant argued that plaintiff's claim was barred by the equitable doctrine of unclean hands because plaintiff itself had purchased other competitors' trademarks as search-engine keywords to advertise its competing products. But the court held that the unclean hands defense did not apply when the plaintiff's conduct was not related to the trademark at issue, i.e., plaintiff's 1-800 CONTACTS trademark.

CASE SUMMARY

FACTS

Plaintiff 1-800 Contacts.com, Inc., the market leader in the field of replacement contact lenses, sold its products online under the federally registered trademark 1-800 CONTACTS. Defendant Memorial Eye, P.A., which also sold replacement contact lenses online, purchased keywords incorporating the 1-800 CONTACTS mark from Google and other search engines. When users searched for 1-800 CONTACTS, the search results displayed defendant's advertisements in the paid sponsored links. Plaintiff objected to defendant's actions several times over a period of a few years, but defendant continued to purchase the disputed keywords.

Plaintiff sued defendant for trademark infringement. Defendant asserted both an affirmative defense and a counterclaim based on the alleged unclean hands of plaintiff. Defendant's unclean hands allegations were based in large part on plaintiff's own acts of purchasing competitors' trademarks (but not defendant's trademarks) as search-engine keywords. Plaintiff filed a motion for summary judgment on defendant's unclean hands defense and counterclaim.

ANALYSIS

The district court granted plaintiff's motion for summary judgment. Defendant's affirmative defense simply pleaded that "[Defendant] asserts the defense of unclean hands," and its counterclaim alleged that plaintiff itself purchased keywords incorporating competitors' trademarks, the same activities for which it was suing defendant. In response, plaintiff argued that defendant could not benefit from the unclean hands defense because plaintiff's alleged misconduct was not related to the 1-800 CONTACTS trademark at issue in this case.

The threshold issue before the court was thus whether an unclean hands defense may be based on a plaintiff's conduct regarding marks unrelated to those the plaintiff...