A toy company that produced a plush toy in the shape of an animal that unfolded into a flat pillow, called a "Pillow Pet," was entitled to a preliminary injunction barring a competitor from using its registered or common-law marks PILLOW PETS; MY PILLOW PETS; IT'S A PILLOW PET; IT'S A PET, IT'S A PILLOW PET; pillowpets.co; "authentic pillow pet," or any confusingly similar mark or colorable imitation thereof as a trademark in connection with competing goods, the federal district court in Brooklyn has determined. The competitor also was enjoined from using the toy company's marks as Internet search-engine advertising keywords.

Validity of "Pillow Pets" Marks

The complaining company was entitled to a presumption of validity with regard to its registered marks, the court said. Although the application to register the mark PILLOW PETS was still pending, the mark was entitled to protection under the common law. The term "Pillow Pet" had no inherent meaning and did not describe the genus of a particular class. The genus at issue was plush stuffed toys, not pillow pets. Thus, the mark was not generic.

The mark was inherently distinctive, in the court's view. It did not obviously signify a foldable plush toy animal. In addition, the company's advertising expenditures and the sales success of the "Pillow Pets" toy line constituted evidence of secondary meaning.

Likelihood of Confusion

The toy company was likely to succeed in showing a likelihood of confusion, the court determined. The competitor's name for its toy line, "Plushez Pillow Pets," was quite similar to "Pillow Pets." The competitor used the term "Pillow Pets" prominently on its labeling, website, and in Google AdWords. There was evidence of actual confusion, including numerous customer reviews on Amazon.com that indicated some consumers had purchased the competitor's toys under the false impression that they had been produced by the complaining company. The likelihood of confusion was also high given the competitor's use of "Pillow Pets" in its pillowpets.co domain name, which could constitute a trademark violation itself. Purchasers of inexpensive toys were not likely to exercise a high degree of care in making purchasing decisions, which further weighed in favor of a likelihood of confusion.

Search Engine Advertising

The company asserted that the competitor was engaging in trademark infringement by purchasing and using the phrases "Pillow Pets" and "My Pillow Pets" as keywords through Google's AdWords program. The AdWords program triggered the display of sponsored links to advertisers' websites when users ran searches that included purchased keywords.

The competitor did not dispute that use of the complaining company's mark as advertising keywords constituted a "use in commerce" under the Lanham Act. Confusion was likely, the court decided. The displayed ads contained terms that were virtually identical to the company's "Pillow Pets" mark. The competitor's website was virtually identical to the complaining company's site, using the same format, color, fonts, and phrases. There was evidence of actual confusion. In addition, the competitor's ads could result in "initial interest" confusion. The complaining company established that it was likely to sustain irreparable harm to its reputation and goodwill in the absence of preliminary injunctive relief.

CJ Products LLC, ED N.Y., ¶61,861.