Bosley Medical Institute, Inc. v. Michael Steven Kremer
403 F.3d 672 (2005)
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Rule of Law:
The noncommercial use of a trademark as the domain name for a website featuring consumer commentary and criticism about the trademark owner does not constitute trademark infringement under the Lanham Act.
Facts:
- Bosley Medical Institute, Inc. (Bosley) provides hair restoration services and owns the registered trademark 'BOSLEY MEDICAL'.
- Michael Kremer, a dissatisfied former patient of Bosley, filed and later had dismissed a medical malpractice lawsuit against the company in 1994.
- In January 2000, Kremer registered the domain name www.BosleyMedical.com.
- Kremer's website published information highly critical of Bosley, including findings from a government investigation.
- The website did not sell any goods or services, earned no revenue, and did not contain paid advertising or direct links to Bosley's competitors.
- Kremer delivered a letter to Dr. Bosley stating, 'Let me know if you want to discuss this. Once it is spread over the internet it will have a snowball effect and be too late to stop,' and listing 'Net web sites disclosing true operating nature' of Bosley as a planned action.
Procedural Posture:
- Bosley Medical Institute, Inc. sued Michael Kremer in federal district court alleging trademark infringement, dilution, unfair competition, and other claims.
- Kremer moved for partial summary judgment, arguing his use was noncommercial and not likely to cause confusion.
- Bosley filed a cross-motion for partial summary judgment on its infringement and dilution claims.
- The district court granted summary judgment for Kremer on the federal trademark infringement, dilution, and Anticybersquatting Consumer Protection Act (ACPA) claims, finding Kremer's use of the mark was noncommercial.
- The district court also granted Kremer's motion to strike Bosley's state law claims under California's anti-SLAPP statute.
- Bosley, as appellant, appealed the district court's judgment to the U.S. Court of Appeals for the Ninth Circuit.
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Issue:
Does the noncommercial use of a registered trademark as a domain name for a website that offers consumer commentary and criticism of the trademark owner's services constitute trademark infringement under the Lanham Act?
Opinions:
Majority - Silverman, Circuit Judge.
No, the noncommercial use of a trademark as a domain name for a consumer criticism website is not trademark infringement under the Lanham Act. Trademark infringement law, under both § 1114 (infringement) and § 1125(c) (dilution) of the Lanham Act, requires a 'commercial use,' meaning use 'in connection with the sale, offering for sale, distribution, or advertising of any goods or services.' Kremer's website did not meet this requirement. The court rejected Bosley's arguments that the use was commercial, reasoning that: (1) attenuated, indirect links to commercial sites are insufficient to render a noncommercial site commercial; (2) there was no evidence Kremer attempted to sell the domain name to Bosley, distinguishing it from cybersquatting cases like Panavision; and (3) merely preventing internet users from reaching the trademark holder's official site is not a commercial use, as that would improperly stifle protected consumer criticism. The purpose of the Lanham Act is to prevent consumer confusion in purchasing decisions, not to shield companies from criticism. Kremer was a critic, not a competitor, and his use of the mark was in connection with expressing his opinion, not selling competing services. However, the court noted that the Anticybersquatting Consumer Protection Act (ACPA) does not have a commercial use requirement and remanded that claim for further proceedings on the issue of 'bad faith intent to profit.'
Analysis:
This decision significantly clarifies the boundary between trademark infringement and protected free speech online, particularly for consumer criticism or 'gripe' sites. It establishes a strong precedent in the Ninth Circuit that the Lanham Act's 'commercial use' requirement is not met by a non-revenue-generating site that merely criticizes a company, even if it uses the company's trademark as its domain name. The court's rejection of the broader 'diversion of customers' theory from the Fourth Circuit's PETA case provides robust protection for online commentary. This ruling forces trademark holders to pursue such cases under the more specific Anticybersquatting Consumer Protection Act (ACPA), which requires proving a 'bad faith intent to profit' rather than just a noncommercial use of the mark.
