College Network, Inc. v. Moore Educational Publishers, Inc., No. 09-50596 (5th Cir. 2010) was an unpublished appellate level case in the Fifth Circuit that upheld a district court jury decision to dismiss the purchase of trademarked keywords as infringing. The original suit was brought on a claim of trademark infringement in the purchase of certain advertising keywords that the defendant countered with claims of defamation and tortious interference, also known as intentional interference with contractual relations. The main issue addressed in the appeal was the sufficiency of the evidence presented in the counterclaims of the defendant. The court upheld the lower court's ruling, but vacated the award for tortious interference.
Background
The College Network (TCN), founded in 1995 and based in Indianapolis, and Moore Educational Publishers (MEP), founded in Nashville in 1986 by Debra K. Moore, both published and sold study guides to nursing students nationwide. Both companies participated in sponsored-link advertising on the Internet, purchasing their respective competitor's name as a keyword in which their link would appear.
Business statements
The College Network hosted a regional sales meeting in July 2006 to train that region's sales staff on how to close sales on study guides by responding to potential customers' objections. The regional director informed the sales staff that their competitor, iStudySmart (the name under which Moore Educational Publishers does business), was "out of business" or "going out of business." In addition, the regional manager also directed the sales staff to repeat these statements to potential customers. MEP learned of these statements during their own sales meeting in May 2007. In the trial, these statements were referred to as "Business Statements."
Moore statements
A salesperson at The College Network, Shara Wright, resigned October 2006. She was later hired to work for Moore Educational Publishers. After her resignation, most of her family members who also worked at The College Network were fired. Only Glenn Cason, a high ranking College Network employee and Wright's cousin, remained. One of the terminated family members, Joel Cromer, testified that Cason explained that they were let go because of Shara's new job with Moore Educational Publishers and Debra Moore. He went on to say that Moore was a thief and dishonest, and had stolen The College Network's secrets. Moore Educational Publishers and Debra Moore discovered these statements the day before Cromer's deposition for the case in December 2007. In the case these statements were referred to as the "Moore Statements."
District Court case
On July 19, 2007, The College Network sued Moore Educational Publishers in a Texan court for trademark infringement, citing Section 43 of the Lanham Act. TCN claimed that by purchasing the keyword phrase "The College Network" to use as a click-through link which would display their advertisement, MEP was using The College Network's "trademark in commerce that was likely to cause confusion, in violation of the Lanham Act." Moore Educational Publishers admitted to purchasing the phrase, but argued they had done so only in response to discovering that The College Network was engaging in the same practice with MEP's own trademarked name. Debra Moore entered into the lawsuit on May 20, 2008, submitting counterclaims of defamation for the statements above. Moore Educational Publishers also submitted counterclaims of defamation and tortious interference related to the "Business Statements."
The case was called to trial on January 13, 2009 with a panel of eight jurors. The College Network presented expert witness Otto Wheeler, who testified that MEP's use of “The College Network” as an Internet search term created a likelihood of confusion under the Lanham Act" and pointed out "purported shortcomings" in the defendant's defamation damages model. Moore Educational Publishers presented evidence of damages from the alleged defamation, citing a correlation between the declaration of the "Business Statements" with a drop in sales, and claiming Moore's reputation suffered from the "Moore Statements." Both sides finished presenting evidence to support their respective claims on January 15, after which both the plaintiff and the defendants submitted motions for judgment as a matter of law, all of which were denied on January 16. The trial was submitted to the jury on January 20, and a verdict returned on January 21, 2009.