Author: Irene Hahn
I. Facts and Procedural History
The Freecycle Network (TFN) is a nonprofit Arizona corporation “dedicated to encouraging and coordinating the reusing, recycling, and gifting of its goods.” Individuals use the group’s webpages to post unwanted items, which another member can then request. TFN sought formal trademark protection for the term “freecycle,” filing a registration application on August 27, 2004. The trademark has not yet been approved. A member of TFN since February 2004 and an active participant in the corporation’s early development, Oey was initially supportive of the application. He later changed his mind and decided the term should remain in the public domain, urging TFN to abandon its registration efforts and publicizing his views on the Internet. After expressing his sentiments in an email to fellow TFN group moderators, he published statements on the Internet that TFN lacked trademark rights in “freecycle” because it was a generic term, and encouraged others to use the term generically and write letters of opposition to the United States Patent and Trademark Office.
TFN asked him to sever ties with the company on September 16, 2005. Afterward, Oey continued to publicize his opposition to Freecycle’s trademark application via the Internet, asking users to use the term in its generic sense. TFN sued Oey in April 2006, alleging trademark infringement and trademark disparagement under section 43 of the Lanham Act, as well as injurious falsehood under Arizona law. The district court granted a preliminary injunction requiring Oey to remove his statements from the Internet. Oey appealed to the Court of Appeals for the Ninth Circuit, which vacated and remanded the decision.
II. Trademark Disparagement
The Ninth Circuit rejected TFN’s allegation of “trademark disparagment,” finding no such claim exists under the Lanham Act. TFN alleged false, malicious statements about TFN’s operations and the validity of its mark, but the court held that the text of section 1125(a) did not support this claim. The court further noted there was no precedent analyzing such a claim. Even if trademark disparagement was a valid cause of action under the Act, Oey’s actions did not satisfy the elements alleged by TFN because he made no false statements. TFN’s trademark application has not been approved, thus Oey cannot be said to have slandered the Freecycle “trademark.” In addition, Oey’s statements were not false depictions of fact; they merely stated his opinion that the TFN trademark should not be approved. Indeed, the court found that Oey’s remarks were aimed at ensuring TFN’s ongoing success, even if he had strong opinions about the term “freecycle.” The district court thereby abused its discretion by relying on this claim to grant TFN’s request for an injunction.
III. Genericide
TFN argued that Oey should be prevented from encouraging the generic use of the word “freecycle.” The court’s responded that all marks are at the risk of becoming generic, as the law cannot prevent ordinary citizens from using language at will. The Lanham Act does not contain an explicit provision preventing the use of a trademarked term in its generic sense. Nor does it prevent an individual from expressing his opinion that a mark should be considered generic, or opining that others should use the mark generically. Clearly TFN disagreed with Oey’s opinion and was frustrated with his activities, but this was not sufficient to make him liable under the Lanham Act.
IV. Trademark Infringement
The Ninth Circuit further held that TFN had not demonstrated a likelihood of success on its trademark infringement claim. The district court did not adequately analyze the necessary elements of an infringement claim laid out in the Act. To be liable for trademark infringement under § 1125, a person must (1) use in commerce (2) any word, false designation of origin, false or misleading description, or representation of fact, which (3) is likely to cause confusion or misrepresents the characteristics of his or another person’s goods or services. The Court of Appeals found that Oey’s comments were not intended to reap any commercial benefit, but merely expressed his opinion that TFN lacked trademark rights in the term “freecycle” and encouraged like-minded individuals to continue to use the term in its generic sense. Moreover, his comments were not false representations of fact; they merely expressed an opinion. Lastly, there was no possibility of confusion, as Oey did not use TFN’s claimed mark in a manner likely to confuse the public.