No.

10-2007

IN THE
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

ROSETTA STONE LTD.,

Plaintiff-Appellant,

v.

GOOGLE INC.,
Defendant-Appellee.

On Appeal from the United States District Court

For the Eastern District of Virginia, Alexandria Division

BRIEF OF AMICI CURIAE PUBLIC KNOWLEDGE

AND ELECTRONIC FRONTIER FOUNDATION
IN SUPPORT OF APPELLEE GOOGLE, INC.

Harold Feld
Attorney for Amici Curiae
John Bergmayer
Rashmi Rangnath Corynne McSherry
PUBLIC KNOWLEDGE ELECTRONIC FRONTIER FOUNDATION
1818 N St. NW, Suite 410 454 Shotwell St.
Washington, DC 20036 San Francisco, CA 94110
(202) 861-0020 (415) 436 9333

December 6, 2010
 TABLE OF CONTENTS

Disclosure.......................................................................................................................... iii
Table of Authorities ......................................................................................................... iv
Statement of the Interest of Amici Curiae..................................................................... vi
Argument ........................................................................................................................... 1
I. Google Did Not Make Trademark Use of Rosetta Stone’s Marks .................... 1
A. Trademark Use is a Narrower Concept than “Use in Commerce” ................... 2
B. Rosetta Stone’s Argument is Incompatible With Persuasive Precedent........... 4
C. Cases Which Suggest That Keyword Advertising Platforms Can Directly
Infringe Trademarks are Unpersuasive............................................................. 7
II. Google’s Uses of Rosetta Stone’s Marks, As Well As the Uses of Most of Its
Customers, Are Fair ........................................................................................... 13
A. Fair Use is Essential to Protect the Free Flow of Information........................ 14
B. Google Makes Fair Use of Rosetta Stone’s Marks......................................... 17
C. Google Is Not Secondarily Liable................................................................... 19
1) Google’s Typical Customers Make Fair Use of Rosetta Stone’s Marks.... 20
2) Fair Use of Rosetta Stone’s Marks Promotes Consumer Welfare ............. 21
Conclusion ....................................................................................................................... 24
Service ............................................................................................................................. 26

ii
 DISCLOSURE

Pursuant to Federal Rule of Appellate Procedure 26.1, amici state that they

have no parent companies, nor do any publicly held companies own ten percent or

more of their stock.

iii
 TABLE OF AUTHORITIES

CASES!

August Storck K.G. v. Nabisco, 59 F.3d 616 (7th Cir. 1995) -----------------------------------------------------20

Century 21 Real Estate v. LendingTree, 425 F.3d 211 (3d Cir. 2005) ------------------------------------- 10, 20

Eldred v. Ashcroft, 537 U.S. 186 (2003) ----------------------------------------------------------------------------15

Government Employees Insurance Company v. Google, 330 F. Supp. 2d 700 (E.D. Va. 2004) -- 3, 8, 9, 18

Hensley Mfg. v. ProPride, 579 F.3d 603 (6th Cir. 2009) ---------------------------------------------------------- 5

Holiday Inns v. 800 Reservation, 86 F.3d 619 (6th Cir. 1996)---------------------------------------------------- 5

Homeowners Group v. Home Marketing Specialists, 931 F.2d 1100 (6th Cir. 1991) ------------------------- 5

Inwood Labs v. Ives Labs, 456 U.S. 844 (1982) -------------------------------------------------------------- 11, 19

KP Permanent Make-Up, v. Lasting Impression I, 543 U.S. 109 (2004) ---------------------------------------16

Lockheed Martin v. Network Solutions, 194 F.3d 980 (9th Cir. 1999)-------------------------------------- 6, 12

Maurag v. Bertuglia, 494 F. Supp. 2d. 395 (E.D. Va. 2007) -----------------------------------------------------21

Merck & Co. v. Mediplan Health Consulting, 425 F. Supp. 2d 402 (S.D. NY 2006)-------------------------18

Nagler v. Garcia, 370 Fed. App’x 678 (6th Cir. 2010) ------------------------------------------------------------- 5

Nat. Fed’n of the Blind v. Loompanics Enters., 936 F. Supp. 1232 (D. Md. 1996) ---------------------- 16, 21

New Kids on the Block v. News America Pub., 745 F. Supp. 1540 (C.D. Cal. 1990) ------------------ 2, 6, 10

New Kids on the Block v. News America Pub., 971 F.2d 302 (9th Cir. 1992) --------------------------- passim

Nova Wines v. Adler Fels Winery, 467 F. Supp. 2d 965 (N.D. Cal. 2006 --------------------------------------- 5

People for Ethical Treatment of Animals v. Doughney, 263 F. 3d 359 (4th Cir. 2001)------------------- 8, 12

Playboy Enterprises v. Netscape Communications, 354 F. 3d 1020, 1029 (9th Cir. 2004) ------------------11

Playboy Enterprises v. Welles, 279 F.3d 796 (9th Cir. 2002) ----------------------------------------------- 22, 23

Prestonettes, Inc. v. Coty, 264 U.S. 359 (1924) --------------------------------------------------------------------14

Rescuecom v. Google, 562 F.3d 123 (2d Cir. 2009) ---------------------------------------------------------- 3, 7, 8

Rock and Roll Hall of Fame and Museum v. Gentile Productions, 134 F.3d 749 (6th Cir. 1998) ----------- 5

iv
Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989)------------------------------------------------------------------15

Smith v. Chanel, 402 F.2d 562 (9th Cir. 1968) ---------------------------------------------------------------------23

Sony Corp. v. Universal City Studios, 464 U.S. 417 (1984)------------------------------------------------------13

Tiffany (NJ) v. eBay, 600 F.3d 93 (2d Cir. 2010) ------------------------------------------------------------- 18, 19

Toyota Motor Sales, U.S.A. v. Tabari, 610 F.3d 1171 (9th Cir. 2010) ------------------------------------- 16, 20

U-Haul Int’l. v. WhenU.com, 279 F. Supp. 2d 723 (E.D. Va. 2003) --------------------------------------------- 6

Universal Commc’n Sys. v. Lycos, 478 F.3d 413 (1st Cir. 2007) ------------------------------------------------16

Vita-Mix Corp. v. Basic Holding, 581 F.3d 1317 (Fed. Cir. 2009) ------------------------------------------ 5, 10

Volkswagen AG v. Dorling Kindersley Pub, 614 F. Supp. 2d 793 (E.D. Mich. 2009)------------------------- 5

Volkswagenwerk AG v. Church, 411 F.2d 350 (9th Cir. 1969) --------------------------------------------------23

WCVB-TV v. Boston Athletic Association, 926 F.2d 42 (1st Cir. 1991) ----------------------------------------23

Wells Fargo & Co. v. WhenU.com, 293 F. Supp. 2d 734 (E.D. Mich. 2003) ----------------------------------- 6

STATUTES!

15 U.S.C. § 1114 -------------------------------------------------------------------------------------------------------- 3

15 U.S.C. § 1127 -------------------------------------------------------------------------------------------------------- 3

17 U.S.C. § 107---------------------------------------------------------------------------------------------------------13

17 U.S.C. § 1115 -------------------------------------------------------------------------------------------------------15

OTHER AUTHORITIES!

MCCARTHY ON TRADEMARKS AND UNFAIR COMPETITION-------------------------------------------------- 4, 10

Stacey L. Dogan & Mark A. Lemley, Trademarks and Consumer Search Costs on the Internet, 41 HOUS.

L. REV. 777 (2004) -------------------------------------------------------------------------------------------------21

v
 STATEMENT OF THE INTEREST OF AMICI CURIAE

Public Knowledge (“PK”) is a non-profit public interest 501(c)(3)

corporation, working to defend citizens’ and innovators’ rights in the emerging

digital culture. An essential part of PK’s mission is to make sure that restrictive

intellectual property laws do not unduly limit consumers’ access to accurate

information, entrepreneurs’ ability to communicate with the public, and web

companies’ ability to provide useful services.†

The Electronic Frontier Foundation (“EFF”) is a non-profit, membership-

supported civil liberties organization working to protect consumer interests,

innovation and free expression in the digital world. EFF and its over 13,000 dues-

paying members have a strong interest in protecting First Amendment and

consumer rights on the Internet and promoting access to online information.

This case calls on the Court to consider how trademark law can facilitate as

well as impede the growth of online speech and commerce, an issue of critical

interest to online speakers, consumers, and technology innovators. As leading

advocates for these groups, amici have a perspective that is not represented by the

parties.

The court is asked to consider whether Google, which operates a keyword

advertising platform (that among other things, allows advertisers to have their ads

†
PK law clerks Mart Kuhn and Jodie Graham assisted in the preparation of this
brief.

vi
display when users search for phrases such as “Rosetta Stone”) is liable for direct

trademark infringement for operating such a platform, or for secondary trademark

infringement if some of its advertising customers themselves infringe Rosetta

Stone’s trademarks.

The court below held that Google was not directly or secondarily liable for

trademark infringement. This Court should affirm. While Google should prevail on

all of the questions before this court, amici argue that Google did not make

“trademark use” of Rosetta Stone’s marks at all, that any use Google did make was

fair, and that Google is not secondarily liable because most of its customers

themselves made fair uses of Rosetta Stone’s marks.

Both parties have consented to this filing.

vii
 ARGUMENT

This Court should affirm the holding below. Because Google did not make

trademark use of Rosetta Stone’s marks, it cannot be directly liable for trademark

infringement. In order to be liable, Google must have used Rosetta Stone’s

trademarks as trademarks—to identify the source of its own goods or services. But

because Google merely used Rosetta Stone’s trademarks to tune its advertising

tools and help businesses market their products, it did not violate the Lanham Act.

To the extent that Google made any kind of use of Rosetta Stone’s marks,

such use was fair, because it promoted lawful competition. Finally, Google is not

secondarily liable, not least because the typical keyword advertiser’s uses are

themselves either non-trademark uses, fair uses, or both.

I. Google Did Not Make Trademark Use of Rosetta Stone’s Marks

Google did not make a “trademark use” of Rosetta Stone’s marks, because it

did not use them to designate the source or origin of a product. Google uses

Rosetta Stone’s marks to display keyword-based advertising, in its auction process,

and in related tools. It does not use Rosetta Stone’s marks to indicate that its

products are manufactured by or affiliated with Rosetta Stone. Therefore, it cannot

be liable for direct infringement.

Rosetta Stone advances a theory that would expand its control of its marks

beyond a trademark owner’s valid interests. In Rosetta Stone’s view, it should be

1
able to control discussions of its products, stop lawful resellers, and prevent

competitors from marketing themselves to potential Rosetta Stone customers

(which it describes as “Rosetta Stone’s customers”). Rosetta Stone’s Opening Brief

(“RSB”) 12. Rosetta Stone complains, for instance, that “competitors, and other

third parties” have attracted customers by using Google’s advertising platform. Id.

But the purpose of trademark law is to prevent consumer confusion, not to protect

established businesses from competition. See discussion infra Parts II.A, II.C.

While Rosetta Stone has valid concerns about counterfeit or pirated copies of its

software, trademark law already addresses them. It is not necessary to craft a new

legal doctrine whereby advertisers cannot use the names of their competitors’

products in comparison ads, resellers cannot say the names of the products they

resell, and advertising platforms must cripple the usefulness of their product in

order to shield trademark owners from lawful competition.

A. Trademark Use is a Narrower Concept than “Use in Commerce”

Rosetta Stone’s argument is incompatible with the statute. The Lanham Act

only creates liability for certain “uses” of marks, not for all uses of particular

words or phrases. New Kids on the Block v. News America Pub., 745 F. Supp.

1540, 1545 (C.D. Cal. 1990), aff’d, New Kids on the Block v. News America Pub.,

971 F.2d 302 (9th Cir. 1992) (“the Lanham Act will not prohibit the use of

[plaintiff’s] trademark unless the defendants explicitly and falsely denoted

2
authorship, sponsorship, or endorsement by the [plaintiffs] or explicitly mislead as

to content.”) This understanding flows directly from the Lanham Act, which

provides that

Any person who shall, without the consent of the registrant—(a) use in
commerce any reproduction, counterfeit, copy, or colorable imitation of a
registered mark in connection with the . . . advertising of any goods or
services on or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive; or (b) reproduce, counterfeit,
copy or colorably imitate a registered mark and apply such . . . to be used in
commerce upon or in connection with the . . . advertising of goods or
services on or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive, shall be liable in a civil action
by the registrant ....

15 U.S.C. § 1114(1) (2006). Liability therefore depends on a party using a

trademark in commerce. A few courts have focused on what it means to “use” a

trademark, noting that the use of certain phrases in keyword advertising tools and

similar activities constitutes a “use in commerce.” See discussion of Government

Employees Insurance Company v. Google, 330 F. Supp. 2d 700 (E.D. Va. 2004)

(Geico) and Rescuecom v. Google, 562 F.3d 123 (2d Cir. 2009), infra Part I.C. The

term “use in commerce” is quite broad. See 15 U.S.C. § 1127. But whether

something is “used in commerce” is immaterial if a particular word is not used as a

trademark. The Act provides that “[t]he term “trademark” includes any word

[used] to identify and distinguish his or her goods, including a unique product,

from those manufactured or sold by others and to indicate the source of the goods,

even if that source is unknown.” Id. Because Google uses words such as “Rosetta

3
Stone” in a way that does not “identify and distinguish [its] goods … from those

manufactured or sold by others” or to “indicate the source of the goods,” id., it is

not using such words or phrases as trademarks. Google is using certain words and

phrases to help its customers tune their advertisements, and is selling access to a

keyword advertising platform. It is not using those words to indicate the origin of

its products, or to try to pass them off as coming from Rosetta Stone. In the context

of a use such as Google’s, where words or phrases trademarked by another are not

being used to indicate the source of goods or services, it is not accurate to say that

“trademarks” are being used, because words are only trademarks to the extent they

are used to identify goods.1 Because Google is not using Rosetta Stone’s marks in

commerce as trademarks, it cannot be liable.

B. Rosetta Stone’s Argument is Incompatible With Persuasive

Precedent

Many courts have found that it is necessary to look beyond whether there

has been a “use” to see whether there has been a use as a trademark. For example,

the Sixth Circuit observed that “it is clear that a plaintiff must show that it has

actually used the designation at issue as a trademark, and that the defendant has

also used the same or a similar designation as a trademark.” Rock and Roll Hall of

1
Thus, Professor J. Thomas McCarthy’s observation that “there is no separate
statutory requirement of ‘trademark use’” is incorrect. MCCARTHY ON
TRADEMARKS AND UNFAIR COMPETITION, § 23:11.50. To use a mark in commerce
is necessarily to use it as a trademark, since a word, phrase, or logo is only a mark
insofar as it designates the source of products.

4
Fame and Museum v. Gentile Productions, 134 F.3d 749, 754 (6th Cir. 1998)

(citing Holiday Inns v. 800 Reservation, 86 F.3d 619, 622-23 (6th Cir. 1996), cert.

denied, 519 U.S. 1093 (1997); Homeowners Group v. Home Marketing Specialists,

931 F.2d 1100, 1105 (6th Cir. 1991)). Later cases in the Sixth Circuit have

followed this reasoning. In Interactive Prods. v. a2z Mobile Office Solutions, 326

F.3d 687, 695 (6th Cir. 2003), the court wrote that “[i]f defendants are only using

[plaintiff’s] trademark in a “non-trademark” way—that is, in a way that does not

identify the source of a product-then trademark infringement and false designation

of origin laws do not apply.” And just last year, the court repeated this analysis:

But the likelihood of confusion analysis also involves a preliminary

question: whether the defendants “are using the challenged mark in a way
that identifies the source of their goods.” If they are not, then the mark is
being used in a “ ‘non-trademark’ way” and trademark infringement laws,
along with the eight-factor analysis, do not even apply.

Hensley Mfg. v. ProPride, 579 F.3d 603, 610 (6th Cir. 2009) (citations omitted).

Numerous courts have found this reasoning persuasive, finding that the defendant’s

use must be a use as a trademark to trigger the infringement analysis. See Nagler v.

Garcia, 370 Fed. App’x 678, 680 (6th Cir. 2010) (following Interactive Prods.

Corp.); Volkswagen AG v. Dorling Kindersley Pub, 614 F. Supp. 2d 793, 809 (E.D.

Mich. 2009) (following Vita-Mix Corp. v. Basic Holding, 581 F.3d 1317, 1330

(Fed. Cir. 2009)); Nova Wines v. Adler Fels Winery, 467 F. Supp. 2d 965, 978

(N.D. Cal. 2006) (following Vita-Mix Corp. and distinguishing between marks that

5
are part of the product itself and marks that are used as source indicators); U-Haul

Int’l. v. WhenU.com, 279 F. Supp. 2d 723, 728 (E.D. Va. 2003) (no violation of the

Lanham Act without evidence that defendant “use[d] [the plaintiff’s] trademarks to

identify the source of its goods or services”); Wells Fargo & Co. v. WhenU.com,

293 F. Supp. 2d 734, 757 (E.D. Mich. 2003) (“There can be no liability under the

Lanham Act absent the use of a trademark in a way that identifies the products and

services being advertised by the defendant”).

New Kids, 971 F.2d 302, is a foundational case for the concept of the “fair

use” of trademarks, and is heavily cited on that basis. But that case also stands for

the proposition that certain uses are not “trademark uses” of any kind. The court

there stated that there are “use[s] to which the infringement laws simply do not

apply,” id. at 307, affirming the court below which had explained “that the Lanham

Act does not apply unless the defendants falsely and explicitly represented that

[plaintiffs] sponsored or endorsed the use of [defendant’s product],” 745 F. Supp.

at 1545.

Selling domain names is very similar to selling keyword advertising slots: in

both cases, the seller provides access to a “namespace” which the buyer uses to

display its content. It is therefore instructive that in Lockheed Martin v. Network

Solutions, 194 F.3d 980 (9th Cir. 1999), where a domain name registrar stood

accused of trademark infringement, the court wrote that “[d]omain names, like

6
trade names, do not act as trademarks when they are used merely to identify a

business entity; in order to infringe they must be used to identify the source of

goods or services.” Id. at 956. Similarly, keywords do not act as trademarks; they

are simply ways for companies to display their ads to potential customers. They are

a marketing tool, not a means of identifying the source of goods.

C. Cases Which Suggest That Keyword Advertising Platforms Can

Directly Infringe Trademarks are Unpersuasive

Rosetta Stone argues that “[s]everal courts have held that Google’s sale of

trademarks as keywords constitutes a use in commerce in connection with the sale,

offering for sale, distribution, or advertising of goods and services.” RSB 26 n.4.

But whether a “use in commerce” took place is not relevant if there was no

trademark use to begin with. Thus, the cases Rosetta Stone relies on—none of

which are binding on this Court—are inapposite and unpersuasive.

Rescuecom, 562 F.3d 123, fails to adequately address whether the

defendant’s alleged use of a trademark was a “trademark use.” It argues that

whether or not a use is “internal,” it could still qualify as a “use” under the Lanham

Act. Id. at 30. But this is not the relevant question: a court must ask whether a

defendant uses a trademark as a trademark. Only when a defendant uses a mark to

“identify and distinguish his or her goods” does the Lanham Act even apply. See

supra Part I.A. The Rescuecom court appeared concerned that, if it adopted this

line of analysis, “the operators of search engines would be free to use trademarks

7
in ways designed to deceive and cause consumer confusion.” Rescuecom at 130.

But consumer confusion is most likely to arise when a defendant is making use of a

plaintiff’s mark to designate the source of its products. Non-trademark uses are

inherently non-confusing: when reading an ad that says, “RC Cola tastes better

than Pepsi,” a consumer is not tricked into thinking that Pepsi is behind the ad. A

consumer of domain names who purchases “peta.org” from Go Daddy is not

confused into thinking that PETA is selling him the domain. And neither does a

keyword advertiser on Google’s advertising platform think that, because it sees the

words “Rosetta Stone” on screen and pays money to have its ads displayed when

users type in “Rosetta Stone,” that it is purchasing ad space from Rosetta Stone

itself.2 Thus, contrary to Rescuecom, not every use of a trademark constitutes a

relevant “trademark use,” and this line of reasoning is not likely to lead to

widespread consumer confusion.

Geico, 330 F. Supp. 2d 700, falls into similar error. That case found “that

defendants use plaintiff’s trademarks to sell advertising space, and then link that

advertising to results of searches,” id. at 703-4, and held that this counted as

“trademark use.” But using a plaintiff’s marks to sell advertising and as part of a

keyword advertising platform is not the same as a defendant using a plaintiff’s

marks to suggest that its products are in fact the defendant’s. These activities are

2
If consumers are confused by the content of an ad, then the advertiser itself may
be liable. Google could only be liable on a secondary basis. See infra Part II.C.

8
“uses,” but they are not uses of trademarks as trademarks. They cannot give rise to

liability.

The court in Geico offers a further theory—that when an advertising

platform sells advertising space to a company, and that company then advertises to

the public, the public might be confused into thinking that the advertising platform

has a business relationship with the trademark holder (i.e., one that gave it

permission to sell keyword advertising space against the trademark holder’s

marks).3 It writes that

[D]efendants’ offer of plaintiff’s trademarks for use in advertising could

falsely identify a business relationship or licensing agreement between
defendants and the trademark holder. In other words, when defendants sell
the rights to link advertising to plaintiff’s trademarks, defendants are using
the trademarks in commerce in a way that may imply that defendants have
permission from the trademark holder to do so.

Id. at 704. This argument fails in the present case because Google’s use of Rosetta

Stone’s marks was not a trademark use. The court posits hypothetical confused

members of the public who think that selling keyword advertising space implies a

licensing arrangement. But this cannot change Google’s uses of Rosetta Stone’s

trademarks, which are not trademark uses because Google is not using them to

3
The court below states that “the relevant market here is not the public at-large,
but only potential buyers of [Rosetta Stone’s] products.” Memorandum Opinion
(“MO”) 27. But the market for Google’s advertising products is not users of its
search engine, or potential buyers of language software. MO 19 (“[Google] does
not sell Google-made products on its website.”]). Its market consists of potential
advertisers, and the most relevant question is whether Google is passing off its
products to them.

9
designate the source of its advertising products, into a trademark use. Absence of

confusion eliminates liability—a non-confusing trademark use is not an

infringement. But the presence of confusion, without more, does not create

liability.4 Unlikely scenarios where consumers are confused by non-trademark uses

do not expand the scope of rights granted to trademark owners, and even some

confusing trademark uses are not infringing if they are also fair uses. Century 21

Real Estate v. LendingTree, 425 F.3d 211, 230 (3d Cir. 2005) (“Even if it is found

that a defendant’s intent is improper and its use of a mark could cause confusion,

the defendant could conceivably prove that even its potentially confusing use is

fair because it is reasonably limited and necessary . . . ”); New Kids, 745 F. Supp.

at 1545 (Arguing that the “risk that some people might think that [plaintiffs]

implicitly endorsed or sponsored the [defendant’s product] is outweighed” by First

4
This is why Professor J. Thomas McCarthy’s view that “trademark use” is an
unnecessary concept, because “there must be a likelihood of confusion for
infringement to occur,” is misguided. MCCARTHY ON TRADEMARKS AND UNFAIR
COMPETITION, § 23:11.50. While it is true that there must be a likelihood of
confusion for infringement to occur, it is going too far to say that all confusing
uses are necessarily infringing. This expands the rights of mark owners, who
traditionally only control the right to use their marks to identify the source of
products. Furthermore, the Federal Circuit has also ruled that the likelihood of
confusion test is not a proxy for proving trademark use, reasoning that “the proper
foci of the likelihood of confusion test are the two competing trademarks as they
are used in commerce, as opposed to the products marked or ancillary designations
not used as trademarks.” Vita-Mix Corp. v. Basic Holding, 581 F.3d 1317, 1330
(Fed. Cir. 2009).

10
Amendment concerns); contra Playboy Enterprises v. Netscape Communications,

354 F. 3d 1020, 1029 (9th Cir. 2004) (relying on pre-New Kids reasoning).

Even assuming arguendo that in such a situation the advertising platform’s

use of the plaintiff’s mark was a relevant trademark use, GEICO’s argument

collapses the distinction between secondary and direct trademark liability, and

allows plaintiffs to bypass the Supreme Court’s carefully-enunciated test for

contributory infringement. See Inwood Labs v. Ives Labs, 456 U.S. 844, 854 (1982)

(if a defendant “intentionally induces another to infringe a trademark, or if it

continues to supply its product to one whom it knows or has reason to know is

engaging in trademark infringement, the [defendant] is contributorially responsible

for any harm done as a result of the deceit.”) But under GEICO’s line of reasoning,

any time a defendant is liable for secondary infringement, it is also liable for direct

infringement, because the confused customers of the “primary” direct infringer (the

advertiser) might think that there was some business relationship between the

plaintiff and the defendant. Finding a defendant both directly and secondarily

liable for the same act is odd enough. But more dangerously, under this argument,

a defendant such as an advertising platform could become liable for direct

infringement any time one of its customers infringes, even in situations where it

would not be secondarily liable. Rosetta Stone argues for a similar theory,

11
discussed infra, Part II.B. But plaintiffs cannot be allowed to do an end-run around

the Supreme Court’s test for secondary liability in this way.

GEICO further relies on a number of factually inapposite cases in its

reasoning—notably, People for Ethical Treatment of Animals v. Doughney, 263 F.

3d 359 (4th Cir. 2001) (PETA). See GEICO, 330 F. Supp. 2d at 703-704. This is

wrong for two reasons. First, in PETA, unlike both GEICO and the present case,

there may have been a “trademark use” at issue. In that case, a defendant was sued

by PETA for operating the domain name “peta.org.” While there are numerous

non-infringing fair uses that the domain name “peta.org” might be put to by users

other than PETA, a person who registers the domain name “peta.org” is arguably,

at least, using the acronym “PETA” as a trademark—to designate the source of his

website. Second, PETA is inapposite because it concerns what would be a direct

infringer, not a company that provided a service to the direct infringer. Even if the

operator of “peta.org” was infringing, this does not mean that the registrar that sold

it the domain itself was liable for infringement. In the present case, Google’s

situation is more analogous to the registrar than to the allegedly infringing user,

and precedent suggests that an actor in that situation is not secondarily liable. See

Lockheed Martin, 194 F.3d 980.

12
 * * *

Because Google does not make “trademark use” of Rosetta Stone’s marks, it

is not liable for infringement.

II. Google’s Uses of Rosetta Stone’s Marks, As Well As the Uses of Most of
Its Customers, Are Fair

Neither Google’s uses of Rosetta Stone’s marks, nor the uses many of

Google’s advertising customers, are “trademark uses” at all. But in trademark, the

term “fair use” has been used to refer both to uses that are trademark uses, but are

nonetheless lawful, and to uses to which the Lanham Act does not even apply in

the first instance.5 New Kids, 971 F.2d at 307-308, is illustrative of this. There, the

court writes that

Cases like these are best understood as involving a non-trademark use of a

mark—a use to which the infringement laws simply do not apply…. Indeed,
we may generalize a class of cases where the use of the trademark does not
attempt to capitalize on consumer confusion or to appropriate the cachet of
one product for a different one. Such nominative use of a mark—where the
only word reasonably available to describe a particular thing is pressed into
service—lies outside the strictures of trademark law: Because it does not
implicate the source-identification function that is the purpose of trademark,
it does not constitute unfair competition; such use is fair because it does not
imply sponsorship or endorsement by the trademark holder. “When the mark
is used in a way that does not deceive the public we see no such sanctity in
the word as to prevent its being used to tell the truth.” Prestonettes, Inc. v.

5
This operates differently than copyright, where “fair use,” 17 U.S.C. § 107,
applies to uses that implicate rights under § 106, not to uses that are non-infringing
because they are not contemplated within the scope of a copyright holder’s
exclusive rights. See Sony Corp. v. Universal City Studios, 464 U.S. 417, 447-51
(1984).

13
 Coty, 264 U.S. 359, 368, 44 S.Ct. 350, 351, 68 L.Ed. 731 (1924) (Holmes,
J.).

Thus, in this section amici argue that Google’s use of Rosetta Stone’s marks, and

the typical Google advertiser’s use of Rosetta Stone’s marks were fair uses,

whether or not those uses are even the kinds of “trademark uses” the Lanham Act

is concerned with.

A. Fair Use is Essential to Protect the Free Flow of Information

Rosetta Stone seeks to change the scope of trademark law, and to grant itself

the right to cripple advertising platforms and silence competitors. While it has

brought suit against Google, it is targeting not only Google’s activities, but the

activities of legitimate advertisers. For example, it writes that Google should “stop

selling the Rosetta Stone Marks to unauthorized third parties,” RSB 49, as though

it had the right to “authorize” all uses of its marks. But as Justice Holmes pointed

out long ago, a trademark “does not confer a right to prohibit the use of the word or

words. It is not a copyright. . . . A trade-mark only gives the right to prohibit the

use of it so far as to protect the owner’s good will against the sale of another’s

product as his.” Prestonettes v. Coty, 264 U.S. 359, 368 (1924). The doctrine of

“fair use” in trademark assures that the valid interests of competitors and the public

are protected as well as the goodwill of mark holders.

Fair use is necessary to facilitate free expression and the exchange of ideas.

Justice Ginsburg has noted that while “[t]he First Amendment securely protects the

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freedom to make . . . one’s own speech,” it also bears on the right to repeat “other

people’s speeches.” Eldred v. Ashcroft, 537 U.S. 186, 221 (2003). Allowing “fair

use” of protected marks is necessary to reconcile the First Amendment with the

Lanham Act. Cf. id. at 197, 219–20 (discussing “fair use” in copyright context, and

calling it a “traditional First Amendment safeguard[]”). Thus, where the Lanham

Act’s restriction on the uses of particular words runs contrary to the First

Amendment’s protection of free expression, courts “must construe the Act

narrowly to avoid such a conflict.” Rogers v. Grimaldi, 875 F.2d 994, 998 (2d Cir.

1989). To the extent that trademark law “deplete[s] the stock of useful words” by

providing “exclusive rights in them,” New Kids, 971 F.2d at 306, it implicates both

the rights to make “one’s own speech” and “other people’s speeches.” Trademark’s

“fair use” doctrines narrow the scope of trademark infringement in both of these

contexts, permitting uses of otherwise-protected words and thereby safeguarding

the freedom of expression. Id.

“Descriptive” fair use is a statutory defense to trademark infringement, 17

U.S.C. § 1115(b)(4), which “forbids a trademark registrant to appropriate a

descriptive term for his exclusive use and so prevent others from accurately

describing a characteristic of their goods.” New Kids, 971 F.2d at 306. As such, it

protects the right to make one’s own speech, permitting the use of words according

to their ordinary meaning—even when doing so would be likely to cause

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confusion. See KP Permanent Make-Up v. Lasting Impression I, 543 U.S. 109, 121

(2004) (“[S]ome possibility of consumer confusion must be compatible with fair

use . . . .”).

“Nominative” fair use, on the other hand, protects the right to make other

people’s speeches, namely by using “the mark to refer to the trademarked good

itself.” Toyota Motor Sales, U.S.A. v. Tabari, 610 F.3d 1171, 1175 (9th Cir. 2010).

Unlike descriptive fair use, “nominative fair use is not specifically provided for by

statute,” id. at 1183 n.11, but it is based on a recognition of the constitutional

interest in free expression: “A trademark injunction, particularly one involving

nominative fair use, can raise serious First Amendment concerns because it can

interfere with truthful communication between buyers and sellers in the

marketplace.” Id. at 1176. A trademark owner’s “protection against copycats . . .

does not extend to rendering newspaper articles, conversations, polls and

comparative advertising impossible.” New Kids, 971 F.2d at 308. Even courts that

have declined to adopt a “nominative fair use” test under that name have

“recognized the underlying principle.” Universal Commc’n Sys. v. Lycos, 478 F.3d

413, 424–25 (1st Cir. 2007); see also Nat. Fed’n of the Blind v. Loompanics

Enters., 936 F. Supp. 1232, 1240–41 (D. Md. 1996) (“[Nominative fair use] test is,

for the most part, a restatement of two basic principles of trademark law.”).

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 Fair use is a vital doctrine that promotes competition, expression, and

consumer welfare. Therefore, this Court should not allow Rosetta Stone to prevent

the fair use of its marks.

B. Google Makes Fair Use of Rosetta Stone’s Marks

Google makes several uses of Rosetta Stone’s marks.6 It uses them to trigger

Sponsored Links (that is, when users search for a term, advertisers can pay to have

their ads display alongside the “organic” results of its search algorithm), MO 30,

and it auctions the right to have certain Sponsored Links displayed against certain

terms. MO 3. Furthermore, its Query Suggestion Tool suggests particular

trademarks, including Rosetta Stone’s marks, that advertisers may wish to

advertise against. MO 33. As an initial matter, these are fair uses because they are

not trademark uses. See supra, Part I. But even if they are “trademark uses,” they

are fair.

Google’s display of Rosetta Stone’s marks to potential advertisers, and sale

of the right to have their ads displayed when users search for certain terms, are

non-confusing uses and therefore fair. Under the doctrine of nominative fair use, a

defendant can use a plaintiff’s trademark to refer to the plaintiff’s products as long

as doing so does not cause “confusion about the source of [the] defendant’s

6
Google writes that it “prohibits its employees from suggesting trademarks as part
of the keyword optimization process.” Google’s Opening Brief (“GB”) 20. But
even if Google did suggest trademarks, such suggestions would be fair uses.

17
product or the mark-holder’s sponsorship or affiliation.” Merck & Co. v. Mediplan

Health Consulting, 425 F. Supp. 2d 402, 413 (S.D.N.Y. 2006); Tiffany (NJ) v.

eBay, 600 F.3d 93, 102-03 (2d Cir. 2010). Rosetta Stone has not presented any

evidence that potential advertisers are confused by Google’s Query Suggestion tool

or practice of selling keyword-based advertising space. Indeed, it is exceedingly

unlikely that potential advertisers on Google’s platform would be confused into

thinking that they were purchasing ad space from Rosetta Stone rather than from

Google. Therefore, this Court should find that Google’s advertising platform

makes nominative fair use of Rosetta Stone’s marks.

Rosetta Stone presents some evidence of confusion among the general

public that results from Google’s display of Sponsored Links. RSB 27. In Rosetta

Stone’s view, Google is directly liable for trademark infringement because some

number of its users viewed confusing ads, or visited confusing websites, after

having used Google’s search tool. But Google cannot be held directly liable for the

conduct of advertisers on its platform in cases where it could not be held

secondarily liable. Similarly to the court in Geico, see supra Part I.C, Rosetta

Stone is attempting to bypass the Supreme Court’s test for secondary liability by

reframing the issue as one of direct liability. If Rosetta Stone’s evidence about

consumer confusion is relevant, it can only be relevant in a secondary liability

context. Because many of the advertisers who use Rosetta Stone’s marks are

18
making fair uses, and because, as argued below, Google is not secondarily liable

for trademark infringement, its display of ads in response to search queries such as

“Rosetta Stone” is itself a fair use.

C. Google Is Not Secondarily Liable

Customers of Google’s advertising platform who use Rosetta Stone’s marks

do so for various purposes. Rosetta Stone has presented evidence that some use the

marks for counterfeit products, RSB 31, but the court below recognized that

Google takes proper steps to deal with these infringing uses, MO 11-12, and is

therefore not secondarily liable under the tests established by Inwood and Tiffany.

MO 32, 37. But Rosetta Stone does not only want Google to take more action to

deal with infringing users: It wants Google to discontinue its practice of auctioning

keywords, and has raised the issue of whether many established, typical advertising

uses of its marks are lawful. It complains of Google displaying ads for “companies

that compete with Rosetta Stone products,” RSB 12, and urges the Court to note, as

a factors in determining infringement, that Google auctions advertising space to

companies “that sell genuine Rosetta Stone product” and “competing language-

learning software,” RSB 32, and to companies that sell “similar goods” to Rosetta

Stone, RSB 33. Throughout its argument, Rosetta Stone uses the term

“unauthorized,” indicating that in its view the only valid uses of Rosetta Stone’s

marks are ones it has expressly authorized. Because Rosetta Stone has raised the

19
issue of whether Google’s typical advertising customers make lawful use of

Rosetta Stone’s marks, this Court should find that typical advertising uses, such as

uses for “comparison, criticism, and point of reference,” New Kids, 971 F.2d at

306, are fair. Indeed, the fact that typical advertisers are lawful should be part of

any secondarily liability analysis.

1) Google’s Typical Customers Make Fair Use of Rosetta

Stone’s Marks

Competitors and resellers of genuine product are the archetypal nominative

fair users; both have a strong and valid need to make references to Rosetta Stone’s

marks, either to truthfully indicate where their products originate, Toyota Motor

Sales, 610 F.3d at 1177, or to draw a distinction between Rosetta Stone’s products

and their own, August Storck K.G. v. Nabisco, 59 F.3d 616, 618 (7th Cir. 1995)

(comparative advertising is “highly beneficial to consumers”). The entire context

of the advertisers’ uses must be taken into account, not just “the mere presence of

the mark on the website.” Century 21, 425 F.3d at 231. As the Ninth Circuit

pointed out, “it is often virtually impossible to refer to a particular product for

purposes of comparison, criticism, or point of reference or any other such purpose,

without using the mark.” New Kids, 971 F.2d at 306. Advertisers’ use of Rosetta

Stone’s marks are such uses. Without actually using the words “Rosetta Stone,” it

would be very difficult, if not impossible, for competitors to present their products

as an alternative to consumers looking for Rosetta Stone’s product. Similarly, it

20
would be difficult for critics to present their point of view to Rosetta Stone users.

As the Ninth Circuit has observed:

[R]eference to a large automobile manufacturer based in Michigan would

not differentiate among the Big Three; reference to a large Japanese
manufacturer of home electronics would narrow the field to a dozen or more
companies. Much useful social and commercial discourse would be all but
impossible if speakers were under threat of an infringement lawsuit every
time they made reference to a person, company or product by using its
trademark.

New Kids, 971 F.2d at 306-30. Given the necessity of use of the “Rosetta Stone”

mark to facilitate competition and criticism and the use of the mark for these

purposes, this Court should recognize that use of trademarks as keyword triggers or

in text of advertisements constitute nominative fair uses.7

2) Fair Use of Rosetta Stone’s Marks Promotes Consumer

Welfare

Trademark law “aims to promote rigorous, truthful competition in the

marketplace by preserving the clarity of the language of trade.” Stacey L. Dogan &

Mark A. Lemley, Trademarks and Consumer Search Costs on the Internet, 41

HOUS. L. REV. 777, 788 (2004). This purpose is also served by the fair use of

trademarks, which helps ensure that consumers receive fair, accurate, and

forthright information. For example, some advertisers pay Google to have their

7
Though district courts in this circuit have thus far declined to specifically adopt a
nominative fair use defense, they have been receptive to the underlying principles.
See Maurag v. Bertuglia, 494 F. Supp. 2d. 395, 398 n.3 (E.D. Va. 2007);
Loompanics, 936 F. Supp. at 1240-41.

21
advertisements displayed when users search for certain terms. Some indicate that

they are lawful resellers of Rosetta Stone software—even if these resellers are

“unauthorized,” they are permitted to accurately use Rosetta Stone marks to

indicate that their products originate with Rosetta Stone. Some use Rosetta Stone’s

marks in the text of their ads to indicate that they have a competing product, or to

compare their products to Rosetta Stone’s. These kinds of uses are usually non-

trademark uses, because the advertisers are not trying to pass off their products as

coming from Rosetta Stone, and are therefore fair. In any event, Rosetta Stone has

not presented legally sufficient evidence of confusion, GB 22, so even to the extent

these uses are trademark uses, they are fair. This Court should recognize that fair

uses promote consumer welfare, and that Rosetta Stone may not stop them.

Many courts have followed this approach and held that uses of trademarks to

promote price comparisons, points of reference, or criticisms of products are fair.

For example, in Playboy Enterprises v. Welles, 279 F.3d 796 (9th Cir. 2002), the

court upheld Welles’ use of Playboy’s marks in the metatags of her website, noting

that respondent would have “no way of identifying the content of her website

without reference” to Playboy’s trademark. The court further observed that, in the

Internet search context,

[S]earchers would have a much more difficult time locating relevant

websites if they could do so only by correctly guessing long phrases
necessary to substitute for trademarks.... Similarly someone searching for

22
 critiques of Playboy on the internet would have a difficult time if internet
sites could not list the object of their critique in their metatags.

The court also noted that precluding such use “would hinder the free flow of

information on the internet, which is certainly not the intent of trademark law.”

804. See also Smith v. Chanel, 402 F.2d 562, 569 (9th Cir. 1968) (holding that “in

the absence of misrepresentation or confusion as to source or sponsorship a seller

in promoting his own goods may use the trademark of another to identify the

latter’s goods,” and permitting a competitor to use the Chanel mark to suggest that

its product was an inexpensive duplication of Chanel’s product); Volkswagenwerk

AG v. Church, 411 F.2d 350 (9th Cir. 1969) (holding that defendant’s use of the

Volkswagen mark to mention the fact that it offered repair services for

Volkswagen cars was permissible); New Kids, 971 F.2d 302 (defendant

newspapers’ use of the plaintiff’s trademark to reference the plaintiff held

permissible); WCVB-TV v. Boston Athletic Association, 926 F.2d 42 (1st Cir. 1991)

(holding that defendant television station’s use of the plaintiff’s trademark “Boston

Marathon” to describe the event it was broadcasting was permissible). This Court

should follow these cases, and recognize that Rosetta Stone’s competitors make

many fair uses of Rosetta Stone’s marks, including by having their ads display in

response to search queries such as “Rosetta Stone.”

23
 * * *

Both Google and typical advertisers make fair use of Rosetta Stone’s marks.

Therefore, Google is not liable for trademark infringment.

CONCLUSION

Because Google makes fair or non-trademark use of Rosetta Stone’s marks,

and because Google’s typical advertising customers make fair use of the marks,

this Court should affirm the court below and hold that Google is neither

secondarily nor directly liable for infringement.

24
 Respectfully submitted,

PUBLIC KNOWLEDGE
ELECTRONIC FRONTIER FOUNDATION

Corynne McSherry John Bergmayer

Attorney for Electronic Frontier Rashmi Rangnath
Foundation Attorneys for Public Knowledge
454 Shotwell Street 1818 N St. NW
San Francisco, CA 94110 Suite 410
(415) 436-9333 Washington, DC 20036
(202) 861-0020

December 6, 2010

By /s Harold Feld
Legal Director
Public Knowledge
Attorney for Amici Curiae

25
 CERTIFICATE OF SERVICE

I, Harold Feld, certify that on December 6, 2010, this document was served

on all parties through CM/ECF. I further certify that I caused eight printed copies

to be filed with the Court via Federal Express.

December 6, 2010

/s Harold Feld
Legal Director
Public Knowledge
Attorney for Amici Curiae
 UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 10-2007
_______ Caption: ROSETTA
__________________________________________________
STONE LTD., v. GOOGLE INC.

CERTIFICATE OF COMPLIANCE WITH RULE 28.1(e) or 32(a)

Certificate of Compliance With Type-Volume Limitation,
Typeface Requirements, and Type Style Requirements

1. This brief complies with the type-volume limitation of Fed. R. App. P. 28.1(e)(2) or
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[Appellant’s Opening Brief, Appellee’s Response Brief, and Appellant’s Response/Reply Brief may
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words or 1,500 lines; any Reply or Amicus Brief may not exceed 7,000 words or 650 lines; line count
may be used only with monospaced type]

[!] this brief contains 5966 [state the number of] words, excluding the parts
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[ ] this brief uses a monospaced typeface and contains [state the number
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32(a)(7)(B)(iii).

2. This brief complies with the typeface requirements of Fed. R. App. P. 32(a)(5) and the type
style requirements of Fed. R. App. P. 32(a)(6) because:

[14-point font must be used with proportional typeface, such as Times New Roman or CG Times;
12-point font must be used with monospaced typeface, such as Courier or Courier New]

[!] this brief has been prepared in a proportionally spaced typeface using Word 2011
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[ ] this brief has been prepared in a monospaced typeface using

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(s)Harold Feld

Attorney for Public Knowledge

Dated: December 5 2010