IP Law Daily, TRADEMARK—EDNY: Chiropractor’s Internet Use of “HealthSource” and Local Use of “HealthQuest” Did Not Infringe Competitor’s HealthSource Mark, (Aug 9, 2012)

By Mark Engstrom, J.D.

To the extent that a chiropractor and his healthcare franchise (HealthSource Chiropractic, Inc.) used the mark “HealthSource Chiropractic” on the Internet and the mark “HealthQuest Chiropractic” in the Rochester, New York, area, they did not infringe the trademark of a Rochester-area chiropractor who operated his business as “HealthSource Chiropractic,” the federal district court Rochester, New York has ruled (Dudley v. HealthSource Chiropractic, Inc., August 7, 2012, Telesca, M.). Because factual issues remained concerning the geographic extent of the plaintiff’s trademark rights in areas outside of Rochester, summary judgment was limited to the defendants’ trademark use on the Internet and in the Rochester area. The plaintiff’s cybersquatting claims were dismissed.

To prove infringement of common law trademark rights under the Lanham Act, a plaintiff had to show that: (1) its mark was valid and legally protectable; (2) it had a right to the exclusive use of its mark; and (3) the defendant’s use of the mark was likely to create confusion regarding the source of the underlying goods or services.

Protectability

According to the court, HealthSource Chiropractic was a suggestive mark and thus was legally protectable without a showing of secondary meaning. First, the mark did not directly describe chiropractic services, as a descriptive mark would. Rather, it required consumers to use their imagination to understand that chiropractic services were a health benefit and the source of that benefit was the chiropractic provider. Second, the defendant used HealthSource as a service mark and business name, not as a term to describe chiropractic services. Third, neither party suggested that the term HealthSource described a quality of chiropractic services. HealthSource was therefore suggestive, inherently distinctive, and entitled to protection without a showing of secondary meaning.

Exclusive UseThe Plaintiff presented uncontroverted evidence that he had used the HealthSource Chiropractic mark in commerce prior to HealthSource Inc.’s date of constructive use. The Plaintiff was therefore the senior user of the mark and the defendants, which held a federal registration for the mark, were junior users.

Federal registration of the HealthSource logo was issued on July 10, 2007. Therefore, the plaintiff possessed territorial rights to the geographic area in which he established common law trademark rights prior to July 10, 2007. Although questions existed concerning the extent of the plaintiff’s “zone of exclusivity,” the plaintiff was entitled to superior common law rights “at least within some area of Monroe County” in New York.

Likelihood of Confusion—Local Use

The defendants operated their Rochester clinic as “HealthQuest Chiropractic” because the plaintiff was using the HealthSource mark in the Rochester area. In the Second Circuit, courts used a likelihood of confusion test that weighed eight factors: (1) strength of the senior mark; (2) similarity of the parties’ marks; (3) competitive proximity; (4) actual confusion; (5) bridging the gap; (6) junior user’s intent; (7) quality of junior user’s product; and (8) sophistication of purchasers.

Strength of Mark. The plaintiff’s mark was suggestive, with some degree of inherent distinctiveness. The strength of mark factor thus favored the plaintiff.

Similarity of Marks. HealthSource and HealthQuest differed by only a single word. That word, however, projected a substantially different impression and possessed a substantially different meaning. “Quest,” for example, meant “to seek out.” HealthQuest thus gave the impression of seeking health. “Source,” however, meant “a point of origin.” HealthSource thus gave the impression of a place where health could be obtained. The words also had significantly different “aural tones.” Finally, the HealthSource and HealthQuest logos were distinctive. The Court concluded that the marks were not substantially similar. This factor did not favor of the Plaintiff.

Competitive Proximity. Both the plaintiff and the defendants offered chiropractic services in the Rochester, New York, area. Competitive proximity thus favored the plaintiff.

Actual Confusion. The plaintiff stated that he had received phone calls and emails that were directed to the defendants, and identified an incident in which a third-party insurance vendor contacted his office claiming that he worked with other HealthSource companies. These types of inquires did not relate to purchasing decisions by those seeking the plaintiff’s services, the court explained, and thus did not constitute the type of confusion that was protected by the trademark laws. By contrast, the defendant chiropractor stated that he: (1) asks clients to specify on their intake forms how they were referred to his practice and (2) was unaware of any instance of confusion between his practice and the plaintiff’s practice. Because the record lacked evidence of actual confusion, this factor weighed in favor of the defendants.

Bridging the Gap. The parties’ competed in the same market; there was no gap to bridge. This factor favored the plaintiff.

Intent. There was no evidence to show that the defendants had chosen the HealthSource and HealthQuest names in bad faith. Accordingly, the intent factor thus favored the defendants.

Quality of Defendants’ Product. The plaintiff did not argue that the defendants’ services were inferior to his own. Rather, he argued that any confusion linking his practice with the defendants’ practice could damage his reputation because the defendant chiropractor was allegedly involved in a fatal car accident and charged with driving while intoxicated, an event that purportedly received local publicity. Although protecting one’s reputation was a valid concern, the alleged danger was merely speculative. The plaintiff presented no evidence that the defendant’s accident had tarnished, or was likely to tarnish, the reputation of his practice. Because issues of material fact did not exist concerning the quality of the defendant chiropractor’s services (or concerning his reputation as a chiropractor, notwithstanding his unrelated driving issue), the product quality factor favored the defendants.

Sophistication of Purchasers. The plaintiff conceded that consumers of chiropractic services could be expected to exercise great care in selecting their service provider. Because chiropractic services were professional and individualized, consumers were less likely to be confused as to source of those services. This factor weighed against a likelihood of confusion finding.

Weighing the Factors. Only three factors favored the plaintiff: the strength of the HealthSource mark, competitive proximity, and bridging the gap. The court thus concluded that a likelihood of consumer confusion did not exist between the HealthSource and HealthQuest marks. Accordingly, the plaintiff’s infringement claim was dismissed to the extent that the defendants used “HealthQuest Chiropractic” in the Rochester area.

Internet Use

To secure nationwide priority in a mark, a federal registration was required. Common law trademark rights were limited to the territories in which the trademark user sold its products, rendered its services, practiced its trade, or established recognition of its mark.

The plaintiff claimed exclusive use of “HealthSource Chiropractic” on the Internet. In doing so, he falsely assumed that the Internet was a territory in which he could assert exclusive trademark rights. The Internet was not, however, a geographic territory to be subdivided; it was a global communication medium that was accessible from anywhere on the planet.

Because an Internet presence was crucial to businesses of every size and reach, the rights of trademark holders would be substantially harmed if one trademark user were able to monopolize the Internet to the exclusion of other lawful users of the same mark. In addition, any such monopolization would undermine the benefits and security that a federal registration provided.

Accordingly, neither party could claim an exclusive right to use their mark on the Internet. Common law trademark users had to develop other ways of distinguishing themselves online.

The plaintiff complained that a Google search for “HealthSource Chiropractic” returned the HealthSource Inc. website first and the plaintiff’s website second. In addition, a professional basket ball team—the Rochester Razorsharks—mistakenly linked to the defendants’ website when it intended to link to the plaintiff’s site, third-party web sites listed the defendants’ franchise with the plaintiff’s logo, and the plaintiff purportedly received calls and emails that were directed to HealthSource Inc. These examples, however, did not reflect the type of confusion that the trademark laws were designed to prevent. Moreover, the plaintiff admitted that he was unaware of any patient or potential patient that was directed away from his practice as a result of the defendants’ use of the HealthSource mark on the Internet.

Because the plaintiff could not establish exclusive Internet rights to his mark, his claim for trademark infringement was dismissed to the extent that the defendants used the “HealthSource Chiropractic” mark on the Internet.

Cybersquatting

The Plaintiff failed to show that the defendants possessed a bad faith intent to profit from the use of the plaintiff’s mark. Its Anticybersquatting Consumer Protection Act claim was therefore dismissed.

The case number is 07-CV-6631

Donald W. O’Brien , Jr. (Woods Oviatt Gilman LLP) for Donald R. Dudley, D.C. Erik J. Overberger (Rankin, Hill & Clark LLP) for HealthSource Chiropractic, Inc.

Cases: Trademark NewYorkNews