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District Court Awards Damages for Tortious Interference of Trademark Holder’s Social Media Site Contracts
By Chinh Vo – Edited by Matt Gelfand

Ordonez v. Icon Sky Holdings LLC, 10-cv-60156-PAS (S.D. Fla. Aug. 30, 2011)
Slip Opinion (hosted by Justia.com)

The District Court for the Southern District of Florida granted the plaintiff’s motion for default judgment, awarding damages and a permanent injunction in a trademark hijacking suit between parties vying for control of an online presence.

The court held that the plaintiff was the senior user of the “Elizabeth Sky” trademark, and that the defendant used the mark in connection with similar goods and services in violation of trademark and unfair competition law. The court also found that the defendant tortiously interfered with the plaintiff’s contracts with various social media sites when the defendant contacted the sites and demanded they take down the plaintiff’s accounts, alleging trademark infringement. The plaintiff also prevailed on her libel per se claims by showing that the defendant had falsely accused her of identity theft on two third-party websites.

Eric Goldman’s Technology & Marketing Law Blog provides an overview and analysis of the case. Social Media, Esq. and everydaycounsel discuss the holding’s implications for social media contracts.The plaintiff, Elizabeth Ordonez, is an established professional dancer, model, choreographer, actress, host and recording artist who has gone by the stage name Elizabeth Sky since 2006. Defendant Icon Sky and its sole managing member Nisha Elizabeth George obtained trademark and service mark registrations for “Elizabeth Sky” in 2009 using graphically altered specimens George had submitted for prior, unrelated applications. George subsequently contacted the social media websites Facebook, Twitter, Myspace and ModelMayhem, where Ordonez had accounts, and made trademark infringement complaints against Ordonez that led to the cancellation of, or changes to, Ordonez’s accounts. George further posted, on social networks and websites she owned, warning messages accusing Ordonez of attempting to steal George’s identity. Ordonez brought this action in federal district court alleging trademark infringement, unfair competition, tortious interference with contracts and business relationships, and libel. George failed to properly answer or otherwise defend the action, and Ordonez moved for default judgment.

Judge Patricia Seitz granted Ordonez’s motion on the basis of the unchallenged evidence Ordonez provided. Judge Seitz first held that the facts satisfied all of the elements for establishing an unfair competition claim under the Lanham Act and common law, as well as common law trademark infringement. The court found that Ordonez’s use of the “Elizabeth Sky” marks predated George’s use, and thus Ordonez had valid common law service and trademarks. Next, the court found that George’s application for the “Elizabeth Sky” mark in association with entertainment and audiovisual services was associated with a high likelihood of confusion because those areas were precisely those in which Ordonez used her mark.

Judge Seitz also accepted Ordonez’s claims for tortious interference with a contractual relationship, specifically with respect to those contracts establishing her social media accounts. The court found that valid clickwrap contracts were created between Ordonez and the various social networks during account creation, and that George knew of these contractual relationships because the required clickwrap agreements are general knowledge. According to the court, George intentionally and unjustifiably interfered with Ordonez’s contractual relationships by misleading the sites as to the identity of the rightful owner of the “Elizabeth Sky” mark, and that Ordonez was injured as result because the removal of her accounts impacted her ability to attract work and sales. Similarly, the court found that George tortiously interfered with Ordonez’s business relationships with various Florida-based businesses. The court also held that George’s statements alleging identity theft, which were posted on third party websites, met the requirements for libel per se.

The court granted Ordonez’s request for permanent injunctive relief, finding that George’s continued use of the “Elizabeth Sky” mark would create irreparable harm and confusion. The court also awarded $81,000 in damages, the bulk of which represents the cost of rebuilding the web pages that Ordonez had spent an estimated 10 hours per week for three years at creating.

This opinion is significant because it cautions that causing a network to remove someone’s online profile may give rise to liability for tortious interference. Furthermore, in expressly recognizing the contractual relationship between a user and a social network, this holding could open the door to other causes of action related to social media presence. Finally, since this case was decided on default, it would be interesting to see how damage awards providing an explicit valuation of an individual or entity’s internet presence will be handled in future, contested cases.

Chinh Vo is a 3L at Harvard Law School.

Posted On Dec - 6 - 2011 Comments Off

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