Oracle Corporation et al. v. Crypto Oracle LLC, et al., Case № 3:19-cv-04900 (N.D. Cal. filed August 15, 2019)[NMR]
Brands, brands, brands. We’ve talked about the importance of brands here at the Crypto Caselaw Minute many times now. This new case is a lawsuit alleging federal trademark infringement; federal trademark dilution; unfair competition; cybersquatting; and state trademark infringement and dilution, that was filed by a small company you may have heard of… Oracle. Okay, not that small of a company. Before we discuss the particulars of this case it is worth talking a little bit about famous marks.
In the United States, the Lanham Act states that a trademark “ is famous if it is widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark’s owner.” The key part there is “widely recognized.” How do you determine if a trademark fits this profile? Well, per the Lanham Act, a court would consider the following when determining if a trademark is famous:
1) The duration, extent, and geographic reach of advertising and publicity of the mark, whether advertised or publicized by the owner or third parties. 2) The amount, volume, and geographic extent of sales of goods or services offered under the mark. 3) The extent of actual recognition of the mark. 4) Whether the mark was registered under the Act of March 3, 1881, or the Act of February 20, 1905, or on the principal register.
Some example famous marks would be: Google, Microsoft, IBM, Exxon Mobil, Apple, you get the picture. Mega companies marks are treated differently than other marks. The plaintiff in this case is the company Oracle. A mega company with lots of trademarks. This is relevant to this case, because you can only bring a trademark dilution claim, which is one of the claims in this lawsuit, under federal law if your mark is famous. Given this fact the complaint contains a cornucopia of information to convince anyone reading that Oracle’s marks are famous. Okay, so who is Oracle suing, and why?
The defendants in this case are a Delaware based company, Crypto Oracle LLC, and its founder Louis Kearn. Crypto Oracle was founded in 2017 as a VC firm “focused on supporting and advising companies building distributed ledger technologies.” The complaint has examples of the websites that Crypto Oracle used with oracle in the domain name, as well as an ample supply of screenshots from social media postings showing Crypto Oracle using the word oracle, ie the name of the company. Okay, fine, but what does that have to do with Oracle? Well, Oracle is in the blockchain biz.
As the complaint says “[a]s a worldwide leader in technology solutions, Oracle’s resources, infrastructure, technology, and expertise allowed Oracle to become an early adopter and provider of blockchain solutions and products to its customers.” In addition, attached to the complaint are copies of Oracle’s blockchain platform, and advertising material related to their blockchain platform.
When Oracle found out about Crypto Oracle they proceeded to send cease and desist letters to Crypto Oracle asking them to change their name. How did Crypto Oracle respond? The complaint alleges, “[d]efendants’ response –including Mr. Kerner’s application to register CRYPTOORACLE despite actual notice of Oracle’s registered and common law trademark rights — necessitated this action.” As a general rule, you really shouldn’t file for a trademark that seems similar to trademarks that you received a cease and desist letter for.
It will be interesting to see the defendant’s response to the complaint, but this doesn’t look great for Crypto Oracle. One open question that may trip up Oracle Corporation down the road is the prevalence of oracles, the concept, in the blockchain space. Given the potential of oracles, the concept, and the inevitability of the word “oracle” showing up in company names and products, we may be seeing lots more suits from Oracle the company in the future.
Disclaimer: Crypto Caselaw Minute is provided for educational purposes only by Nelson Rosario (@nelsonmrosario) and Stephen Palley (@stephendpalley). These summaries are not legal advice. They are our opinions only, aren’t authorized by any past, present or future client or employer. Also, we might change our minds. We contain multitudes. As always, Rosario summaries are “NMR” and Palley summaries are “SDP”.