District Court Rules in AOL v. AT&T Trademark Case

(August 17, 1999) U.S. District Court Judge Claude Hilton ruled on Friday, August 13, that YOU HAVE MAIL, BUDDY LIST, and IM are generic. AOL had sought to enjoin AT&T's use of these marks.

The suit concerns whether online service provider America Online can prevent AT&T, which operates the competing WorldNet service, from using some of the same terms and sounds used by America Online.

Last December, when the movie "You've Got Mail" was playing in theaters, AT&T WorldNet initiated its use of the terms You Have Mail, Buddy List, and IM. AOL was upset, and filed suit in U.S. District Court in the Eastern District of Virginia alleging various trademark and unfair trade competition claims. In a Christmas eve hearing, the court denied AOL's request for a temporary restraining order.

Last Friday, the court granted summary judgment in favor of AT&T.

AT&T's General Counsel, James Cicconi, had this to say after the ruling:

"We’re pleased the court agreed that these terms are in the public domain -- available for all to use. AOL’s claim that it owns the everyday language of the Internet is another example of AOL’s attempt to monopolize all aspects of services over the Internet. This decision also deals a setback to AOL’s efforts to keep a stranglehold over Instant Messaging. It is a great victory for the Internet community."

AOL has the option of appealing Judge Hilton's ruling to the U.S. Court of Appeals for the 4th Circuit.

The initial complaint was filed on December 22, 1998. AOL filed an Amended Complaint on January 19, 1999, which contained seven counts.

1. Federal Trademark Dilution under 15 § U.S.C. 1125(c) (regarding YOU HAVE MAIL, mailbox logo, and YOU'VE GOT MAIL).

2. Federal Trademark Dilution under 15 U.S.C. § 1125(c) (IM and BUDDY LIST®).

3. Trademark Infringement under 15 U.S.C. §1114 (BUDDY LIST®).

4. Unfair Competition and False Designation of Origin under 15 U.S.C. §1125(a) (You Have Mail!).

5. Unfair Competition and False Designation of Origin under 15 U.S.C. §1125(a) (I M Here and Buddy List).

6. Unfair Competition and False Designation of Origin under 15 U.S.C. § 1125(a) (Overall impression).

7. Interference with Prospective Economic Advantage.

AOL argued that it should be entitled to protection because there are alternative terms that AT&T could use.

However, Judge Hilton wrote in his 41 page Memorandum Opinion "that the Court's primary concern should not be the availability of alternative terms, but rather whether the term/phrase is generic under the primary significance test."

"Under this test, a plaintiff who is seeking to establish a valid trademark must show "that the primary significance of the term in the minds of the consuming public is not the product but the producer."" Judge Hilton, quoted from the U.S. Supreme Court decision in the Kellogg case. (Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 118, 59 S.Ct. 109, 113, 83 L.Ed. 73 (1938).)

Judge Hilton analyzed the "primary significance" of the disputed terms, or marks, by examining other online services' use of the marks, AOL's use of the marks, dictionary definitions, media usage, and computer how to books.

For each of the disputed marks, Judge Hilton concluded that not only other companies, reporters, dictionary writers, and book authors, but even AOL personnel, used the terms generically, to describe the service provided, rather than the business providing them.

Hence, Judge Hilton ruled that AOL was not entitled to trademark protection. And as to the one mark which AOL had registered, BUDDY LIST, Judge Hilton ordered that it be cancelled.

Judge Hilton's Order contained the following words:

"(1) Defendant's Motion for Summary Judgment is GRANTED, as the Court finds YOU HAVE MAIL, IM, and BUDDY LIST are generic. Plaintiff s Federal trademark registration 2,167,048 for BUDDY LIST is CANCELED;

(2) Defendant's Motion for Summary Judgment is DENIED insofar as it applies to YOU'VE GOT MAIL, as this issue is now MOOT; and

(3) the claims and counterclaims pertaining to the mailbox logo are WITHDRAWN. A copy of this Order shall be sent to the Commissioner of Patents and Trademarks in order to effect the cancellation of the BUDDY LIST mark, and this case is DISMISSED."

AT&T Press Release. Re: AOL v. AT&T. Date: August 16, 1999. Source: AT&T. Federal Court Rejects AOL Attempt to Exert Ownership of Language Used on the Internet Background:  The United States District Court for the Eastern District of Virginia on Friday granted AT&T summary judgment regarding the use of “you have mail,” “IM,” and “buddy list,” finding that these are generic and common expressions, the property of no one and available for use by everyone on the Internet. In ruling in favor of AT&T and against AOL, Chief Judge Hilton concluded that AOL cannot claim these phrases as trademarks and prevent any party from using these terms. AOL sued AT&T shortly after the release of the Warner Bros. movie “You’ve Got Mail,” claiming that no one else could use the phrase “you have mail” to notify e-mail users that they have mail. AOL also asserted exclusive rights to “IM” and “buddy list,” the terminology of Instant Messaging. AOL lost on its claim for emergency relief but continued to pursue its case -- even after it learned that AT&T had been using the phrase “you have mail” for over 20 years and that others were also using the term in electronic commerce. The court held no trial was needed because the law clearly provides that the public is free to use these terms. (The following statement may be attributed to Jim Cicconi, AT&T General Counsel.) We’re pleased the court agreed that these terms are in the public domain -- available for all to use. AOL’s claim that it owns the everyday language of the Internet is another example of AOL’s attempt to monopolize all aspects of services over the Internet. This decision also deals a setback to AOL’s efforts to keep a stranglehold over Instant Messaging. It is a great victory for the Internet community.