Network Automation, Inc. v. Advanced Systems Concepts, Inc.

In the case, Network Automation advertised their own competing product in search queries that contained Advanced Systems Concepts' "ActiveBatch" trademark.

[2] The Brookfield case also emphasized flexibility in applying the law to the Internet, a new, emerging technology: We must be acutely aware of excessive rigidity when applying the law in the Internet context; emerging technologies require a flexible approach.The district court ordered a preliminary injunction against Network using the "ActiveBatch" mark.

[2] The district court analyzed the eight Sleekcraft factors and emphasized that the "Internet troika" from Brookfield were most significant, and found that they all favored Systems.

It concluded that the likelihood of confusion was insufficient to support trademark infringement and therefore removed the injunction placed on Network.

Rather, it re-emphasized that the factors and principles considered in Sleekcraft are non-exhaustive and should be applied flexibly in the context of Internet commerce and other emerging technologies.

The Ninth Circuit Court also concluded that the type and cost of the product affects the degree of care by the consumer.

A consumer of expensive, business software is more likely to understand search engines and sponsored advertisements, and thus be less likely to be confused.

Internet advertising was becoming ubiquitous, so sharing the same marketing channel does not reveal any information on the likelihood of consumer confusion.

[2] The district court correctly disregarded this factor, since the likelihood of expansion does not apply when the two companies are direct competitors.

[5] The results of this case will make it more difficult for future plaintiffs complaining about trademark infringement with keyword advertising.