On November 7, 2013, the United States District Court for the Western District of Virginia issued its opinion in AvePoint Inc. v. Power Tools, Inc., a case that, at least in part, has fortified the ability of a competitor injured by a fictitious social media profile to bring a claim under the Lanham Act.
In AvePoint, SharePoint software platform developer AvePoint, Inc. brought several federal and state law claims against its marketplace competitor Axceler. In its complaint, which included allegations that Axceler had defamed AvePoint by falsely “tweeting” that AvePoint’s products were manufactured in China, AvePoint alleged that Axceler set up a fictitious account on professional networking website LinkedIn. The profile, under the name of “Jim Chung,” purported to be that of an AvePoint representative, and “encourage[d] viewers to contact Jim Chung…regarding business deals with AvePoint, new ventures with AvePoint, and consulting related to AvePoint products and services.” According to AvePoint, any LinkedIn user attempting to contact “Jim Chung” was then directed to an Axceler representative.
Upon these allegations, AvePoint brought claims for trademark infringement, false association and false endorsement, and false designation of source or origin under the federal Lanham Act (AvePoint also brought claims of defamation, breach of contract, false advertising, and various claims under state law, which are beyond the scope of this post).
Axceler moved to dismiss under Federal Rule 12(b)(6), arguing that AvePoint had failed to sufficiently plead these claims. The court, however, denied the motion.
With respect to AvePoint’s trademark infringement claim, a key issue was whether Axceler had “used” AvePoint’s trademarks “in commerce” or whether they were being used in a non-trademark way, such as listing a company name on a resume. According to the judge, Axceler’s alleged use of the “AvePoint” mark on the Internet was technically “use in commerce,” and the fake LinkedIn profile was more than just a “resume for Chung,” as Axceler argued, because it was used by Axceler for competitive, “commercial use.” Moreover, there was a “likelihood of confusion” between the two alleged uses of the “AvePoint” mark, due in no small part to the contentions that Axceler had intended to infringe the mark, and that consumers had actually been confused.
Turning to the false association and false designation of origin claims, the court again denied Axceler’s motion to dismiss, holding that AvePoint’s assertions were beyond speculative, and rejected Axceler’s argument that the court should dismiss these claims because the LinkedIn profile did not “contain any statements telling viewers that AvePoint sponsored, approved of, or endorsed” it. The Lanham Act, the court noted, required only a “likelihood” that viewers would mistakenly believe these things.
While the merits of AvePoint’s claims have yet to be adjudicated, this opinion demonstrates that the creation of fictitious LinkedIn profiles (and perhaps profiles on other social media platforms) may be actionable under the Lanham Act. This holding may provide a method of recourse to companies injured by fake profiles. It may moreover warn all businesses against any questionable competitive tactics to thwart the competition via social media.
Read the full Avepoint, Inc and Avepoint Public Sector, Inc. v. Power Tools, Inc. d/b/a Axceler and Michael X. Burns.
Justin Haddock (justin.haddock@nortonrosefulbright.com / +1 512 536 3024) is a lawyer in Norton Rose Fulbright’s Austin intellectual property practice.
