Novak d/b/a Pets Warehouse v. Overture

Citation: Novak d/b/a Pets Warehouse v. Overture Services, Inc., 309 F.Supp.2d 446 (E.D.N.Y. 2004).

Factual Background
Plaintiff, Novak, is the owner of the “Pet Warehouse” trademark and petwarehouse.com website.

Trial Court Proceedings
On September 24, 2002, Novak filed a complaint, alleging that various Internet search engines were involved in committing trademark infringement and tortious interference with his business.

The first count alleged that Google, Inc. (“Google”) "breached a contract" when the company refused to remove material from its online discussion group that was objectionable to Pets Warehouses. This, Novak claimed, was a direct failure by Google to abide by its own terms of services, which provided for the "remov[al] of all material that [the plaintiff] found objectionable."

Additionally, Novak asserted that Google, as well as the other named defendants, were involved in the “tortious interference” with his business. Novak believed the defendants were doing this by taking part in the manipulation of certain search outcomes when paid to do so. Novak’s complaint alleged that the defendant’s sold the words "pets" and "warehouse", which Novak claimed he owned, to third-parties for the placement of advertising. As a result, Novak claimed that when a user searched for a phrase such as “pet warehouse”, the defendants' websites would be listed before the plaintiff’s website. This, Novak claimed, constitutes “direct[], contributory[] and vicarious[]. . . acts of unfair competition, trademark infringement, trademark dilution, misappropriation, deceptive trade practices, unjust enrichment and tortious interference.”

In response to the plaintiff’s allegations, all named defendant’s moved to dismiss for lack of personal jurisdiction or, in the alternative, for failure to state a claim.

The district court concluded that Google was statutorily immune from tort liability to Novak. In addition, the court also made the determination that Google was entitled to dismissal of based on improper venue, however, the other defendants’ motion to dismiss for lack of personal jurisdiction was denied. In absolving Google of all tort liability, the district court determined that the company’s actions fell squarely within 47 U.S.C. 230(c)(1), which states: “no user of an interactive computer service shall by treated as the publisher or speaker of any information provided by another information content provider.” Since Google did not act as an “information content provider,” the court held that granting Google’s motion to dismiss for failure to state a claim was proper.

Moreover, the court determined that Novak’s participation in Google’s discussion boards bound him to the forum selection clause that Novak was required to agree to prior to using the service. The plaintiff’s argument that he had not opportunity to negotiate the terms of the contract was without merit. The court determined that Novak could have easily taken the opportunity to refuse the terms of the contract. Therefore, the lack of dialogue between Novak and Google did not mean that the forum selection clause was unenforceable; instead, the terms Novak agreed to prior to using the discussion boards were fully applicable. Next, the court concluded that the exercise of jurisdiction over the named website operators was proper. In arriving at this determination, the district court found that all defendants had sufficient “minimum contacts” so as to put them on notice that they may be hailed to court in the forum state. For that reason, the circumstances in the case “clearly comport[ed] with the principles of due process” and did not offend the “traditional notions of fair play and substantial justice.

Finally, due to the pre-discovery phase of the case, the court reasoned that a determination on whether or not the term “Pets Warehouse” was generic could not be made. As a result, all motions to dismiss the trademark claims as a matter of law were denied.