Trademark Strategy in the Internet Age: Customer Hijacking and the Doctrine of Initial Interest Confusion

Internet search engines allow rapid access to customers – and the potential for rapid loss of customers. “Search engine optimization” techniques create a direct mechanical pathway to inertial disruption, allowing a website owner to hijack “Firm A's” trademarks, then use those trademarks to steal Firm A's established customers. This article explains what marketers need to know about federal trademark law within an Internet context. The sequence and substance of the federal court's cyber-age infringement analysis is illustrated via examination of several recent cases. The purpose of this article is to (1) explain recent legal developments pertaining to Internet trademark use in terms accessible to non-lawyers; (2) provide guidance to practitioners on how to stop the exploitation of one's trademarks, and explain the legal limits on the use of another firm’ trademarks, and (3) demonstrate how Internet use of trademarks alters our theoretical understanding of retail equity and customer lifetime value. Recommendations for practice are discussed and theoretical implications outlined.