Conrad, Glen E., United States District Judge
This case is not eDiscovery specific, but demonstrates when creating fake social media accounts may be actionable.
Trial court denied defendant's motion to dismiss where there was sufficient evidence to show damage to plaintiff after defendant took deliberate steps to try and confuse customers into believing plaintiff and it's software that is sold to the U.S. Government was made overseas. Plaintiff provides customized infrastructure built off of Microsoft Sharepoint for government entities; defendant was a direct competitor seeking to undermine plaintiff's business.
Plaintiff is a Delaware corporation that built and marketed its products in the US, primarily to the U.S. Government. In an attempt to make customers believe that plaintiff was headquartered in and manufactured their products in Asia, defendant created a fake profile on LinkedIn for an engineer employed by plaintiff that was headquartered in China Defendant's employees then tweeted out references to the engineer to drive traffic to his profile. A review of the profile indicated that the profile used the plaintiff's mark and that many prospective and current clients of plaintiff believed that the engineer was, in fact, an employee of plaintiff who lived and worked in China. Defendant also used a fake email account to download a copy of plaintiff's software for review. The IP address for the download came from defendant's servers.
Plaintiff sued for defamation, breach of contract, trademark infringement and false advertising (among others). Defendant moved to dismiss all counts, claiming plaintiff could not demonstrate any damages. Plaintiff put forth evidence that consumers were confused by the social media accounts, that customers may have been dissuaded by dealing with a government contractor supposedly located in China, and by failed attempts to contact the fake representative. The court found that plaintiff presented sufficient evidence of harm, and denied the motion to dismiss.
v.
POWER TOOLS, INC. d/b/a Axceler and Michael X. Burns, Defendants
Counsel
*502 Robert Michael Tyler, Spotts Fain, PC, Richmond, VA, Joshua F.P. Long, Joshua Richard Treece, Woods Rogers PLC, Roanoke, VA, for Plaintiffs.Wyatt B. Durrette, Jr., John Buckley Warden, IV, Durrettecrump, PLC, Brian Aaron Richardson, McCandlish Holton PC, Richmond, VA, John Peter Kristensen, Kristensen Law Group, Los Angeles, CA, for Defendants.
MEMORANDUM OPINION
To use PETA's Mark “in connection with” goods or services, Doughney need not have actually sold or advertised goods or services on the www.peta.org website. Rather, Doughney need only have prevented users from obtaining or using PETA's goods or services, or need only have connected the website to other's goods or services.
(1) the strength or distinctiveness of the plaintiff's mark as actually used in the marketplace; (2) the similarity of the two marks to consumers; (3) the similarity of goods or services that the marks identify; (4) the similarity of the facilities used by the markholders; (5) the similarity of advertising used by the markholders; (6) the defendant's intent; (7) actual confusion; (8) the quality of the defendant's product; and (9) the sophistication of the consuming public.
[E]vidence of actual confusion is reflected in Jim Chung's connection list which shows actual AvePoint employees and current and potential AvePoint customers who have been confused about AvePoint's affiliation with Axceler's imposter account. Because Axceler used AvePoint's Mark in its profile, AvePoint's current customers, including Nintex and Aetna have been misled and deceived into believing that Jim Chung was an AvePoint colleague, and have connected to this account. This confusion as to source or sponsorship by current AvePoint employees is equally insidious because those employees unwittingly enabled Axceler to access other AvePoint customer and employee contacts—including those customer contacts associated with legitimate AvePoint employees' profiles—and other competitive business information.