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Shade’s Landing, Inc. v. Williams, 76 F.Supp.2d 983 (D. Minn. 1999) (full-text).
Factual Background Edit
Shade’s Landing was the owner of the domain name “HOME-MARKET.COM”. Its website targeted homeowners and referred them to home-related services such as real estate agents, mortgage services, and landscapers. It was also in the business of developing websites for real estate agents and brokers.
Williams’s was the owner of the domain name “HOME-MARKET.NET. Its website offered website development services for real estate agents and brokers and provided advertising space for businesses in the real estate industry. Neither party received a federal registration for its alleged trademark.
Trial Court Proceedings Edit
Shade's Landing moved for a preliminary injunction to prohibit Williams from using its domain name. Williams opposed the motion by challenging the validity of Shade’s Landing's trademark. The court denied Shade's Landing's motion for preliminary injunction, holding that it was unlikely to succeed on the merits of its case because its domain name was merely descriptive of the service it provided. The domain name had not acquired secondary meaning, and therefore was not entitled to protection as a trademark.
In assessing Shade's Landing's entitlement to a preliminary injunction, the court first sought to determine the validity of the Shade's Landing mark by classifying it as generic, descriptive, suggestive, or arbitrary and fanciful. The parties agreed that the term HOME-MARKET.COM was either suggestive (and thus inherently entitled to protection) or descriptive (requiring Shade's Landing to show secondary meaning before any trademark rights could attach).
Applying the "imagination" test, the court held that the mark HOME-MARKET.COM was descriptive of Shade's Landing's services and was, therefore, not entitled to trademark protection absent a showing of secondary meaning. Under the imagination test, a term is suggestive rather than descriptive only “if the mental leap between the word and the product's attributes is not almost instantaneous.”
In holding that Shade’s Landing’s mark was descriptive, the court reasoned that its mark HOME-MARKET.COM "clearly conveys the general nature of the services it identifies." Interestingly, the court broke the domain name into components and identified how each component described Shade's Landing's business. From this, it concluded that the term "Home" described services related to homes, "Market" described services available to consumers and ".com" described services available over the Internet.
After finding that Shade's Landing's mark was descriptive, the court went on to analyze the likelihood of confusion between the two marks. Despite recognizing that the domain names at issue were virtually identical and that both companies offered web-based advertising and site development services to real estate agents, the court held that no likelihood of confusion had been proven. It stated that the mark was weak, that Williams was not alleged to have intentionally passed off its services as those of Shade's Landing, and that very little evidence of actual confusion had been presented. Therefore, while the court found that a possibility of consumer confusion existed, it held that the "possibility is not so strong that it constitutes a 'substantial likelihood' of confusion."