Universal Tube & Rollform Equipment Corp. sues YouTube

November 1, 2006

News:  An Ohio-based company called Universal Tube & Rollform Equipment Corp. today filed a trademark lawsuit against YouTube.  Universal Tube claims to have a huge surge in Internet users to its site (www.utube.com), mushrooming from 1,500 per month to over 2 million, apparently because users are looking for YouTube’s site (www.youtube.com).  (More from KLTV)

Analysis:  This is an odd case.  I haven’t seen the complaint, but, from the Washington Post, it alleges in part:  “Due to the confusion in the minds of consumers, the spillover of nuisance traffic to Plaintiff’s neighboring website at utube.com has destroyed the value of Plaintiff’s trademark and Internet property, repeatedly caused the shutdown of Plaintiff’s Web site, increased Plaintiff’s Internet costs by thousands of dollars a month, and damaged the Plaintiff’s good reputation.”

Based on this description, I’ll assume that Universal Tube’s claim is straight trademark infringement.  And, if that’s the case, the claim seems pretty flimsy.  Here’s why:

1.  Reverse consumer confusion for unrelated goods?:  It will be very difficult for Universal Tubing to establish a likelihood of confusion among consumers.  In the typical trademark lawsuit, the senior trademark holder (i.e., the one who used or registered the mark first) sues a junior trademark holder on the grounds that the junior trademark holder has used the same or similar mark in a way that is likely to confuse consumers to believe goods from the junior trademark holder actually originate from the senior user.  Just think today if some computer company (junior user) started using “Microsoft” on its computer products.  Consumers probably would believe that all “Microsoft” computer products come from the company founded by Bill Gates (senior user).  That would be a classic case of trademark infringement.

Here, however, it seems doubtful that consumers are likely to confuse YouTube for the tubing company in Ohio, Universal Tube, which claims to have used the mark “utube” for its tubing products.  The product/service lines are so different — video service versus industrial tubing products — that it’s hard to imagine anyone confusing either for the other.  Under trademark law, a trademark holder only gets rights to a trademark for the type of goods or services it actually sells, plus a reasonable zone of expansion into related products lines.  For a business to “bridge the gap” from industrial tubing to video online would be pretty extraordinary.

Instead, Universal Tube probably must proceed on a theory of “reverse consumer confusion.”  Under this theory of trademark infringement, consumers are likely to confuse the senior user’s mark (here, that of Universal Tube) for the now more well known junior user’s mark (here, YouTube).  But the problem is that Universal Tube still faces the same problem of showing a likelihood of confusion for pretty unrelated products/services.  Who in their right mind will associate industrial tubing and video?

2.  Reverse initial interest confusion?:  What Universal Tube really appears to be complaining about is the massive amount of hits to its website (www.utube.com) by people who mistakenly believe that the site is YouTube’s site (www.youtube.com).  The surge in hits to utube.com’s website caused the servers to overload and the site to shut down temporarily.  And, even though the site is back up and running, the server’s capacity is taxed with the surge in hits.

It’s unfortunate that Universal Tube is faced with this situation (some businesses, though, might like the mistaken publicity), but it’s not really a trademark problem.  Even under the controversial theory of “initial interest confusion” (i.e., diversion caused by a domain name that is similar or same as someone else’s trademark), Universal Tube’s argument looks like a stretch.  The Sixth Circuit (where the case was brought) does not recognize initial interest confusion as an independent basis for trademark infringement.  The plaintiff still has to prove a likelihood of confusion as to the origin of the goods or services.  But that faces the same problem discussed above.  Moreover, here it’s not even a typical case where some website appears to be diverting users away from the senior trademark holder.  It’s the exact opposite, an alleged senior user is receiving a greater number of visitors to its website based on the popularity of the junior user’s mark.  This might be called “reverse initial interest confusion” — something that I don’t even know has been recognized by a court.  

For a more succinct assessment, read the first “comment” below.

Comedy Central decides to leave many clips on YouTube

November 1, 2006

News:  Sarah Hall of E! Online has the inside scoop about Comedy Central’s recent decision to ask YouTube to remove some unauthorized clips of the Daily Show, the Colbert Report, and South Park from YouTube.  Turns out that Viacom, Comedy Central’s parent company, decided to remove some, but not all, clips from YouTube — which explains why many clips are still up on YouTube (as I reported here over the weekend).

Viacom stated: “We want our audiences to be able to access our programming on every platform and we’re interested in having it live on all forms of distribution in ways that protect our talented artists, our loyal customers and our passionate audiences.”

Analysis: From a business standpoint, I think Viacom’s multi-platform approach makes a lot of sense.  If YouTube garners milions of eyeballs each day, it would be stupid to have all the clips removed from YouTube.  While Comedy Central is building its own website with video clips, the library does not yet appear to be as large as what YouTube had.  Also, I don’t think the clips of Comedy Central shows on YouTube amount to a net loss for Comedy Central.  Comedy Central gets a benefit from free advertising on YouTube to pump up the popularity of their shows (this could be considerable), while Comedy Central loses the ability to package those clips on its own site, or attempt to license those clips to YouTube.  In the end, Viacom decided here to “split the difference” and allow some, but not all, clips on YouTube to remain there.  

David Letterman’s Halloween

November 1, 2006