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EFF: 20030328 taxes-com amended prelim injunc

EFF: 20030328 taxes-com amended prelim injunc

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Published by: EFF on Jan 28, 2008
Copyright:Attribution Non-commercial


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IN THE UNITED STATES DISTRICT COURTFOR THE NORTHERN DISTRICT OF CALIFORNIAJ.K. HARRIS & COMPANY, LLC, a SouthCarolina limited liability company,Plaintiff,v.STEVEN H. KASSEL, an individual;and FIRSE TAX, INC., a CaliforniaCorporation, d/b/a TAXES.COM,Defendants./No. 02-0400 CWORDER GRANTINGRECONSIDERATIONAND AMENDINGORDER GRANTINGIN PART ANDDENYING IN PARTPLAINTIFF’SAPPLICATION FORA PRELIMINARYINJUNCTIONPlaintiff J.K. Harris & Company, LLC moved for a temporaryrestraining order (TRO) and then a preliminary injunctionenjoining Defendants from 1) using the trade name “J.K. Harris”on Defendants’ “taxes.com” web site; 2) publishing defamatory,untrue or misleading information about Plaintiff; 3) using HTMLcode and computer programming techniques to divert Internetusers looking for Plaintiff’s web site to Defendants’ web site;and 4) using any editorial position at Internet directories topromote Defendants’ business and interfere with Plaintiff’sbusiness. The Court granted Plaintiff’s request for a TRO andthen, in an Order dated March 22, 2002, the Court granted inpart and denied in part Plaintiff’s motion for a preliminaryinjunction. The Court enjoined Plaintiff from “using more ofPlaintiff’s trade name than is reasonably necessary to identifythat it is Plaintiff’s services being described” and from makingor disseminating certain identified allegedly false statements.
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2March 22, 2002 Order at 21-22. Defendants then requested thatthey and amicus curie the Electronic Frontier Foundation (EFF)be granted leave to file a motion for reconsideration. TheCourt granted Defendants’ request as to the issues raised byEFF’s brief in support of Defendants’ request forreconsideration. After considering all of the papers filed bythe parties and by the amicus curie, the Court now GRANTSDefendants’ motion for reconsideration. The Court VACATES itsMarch 22, 2002 Order and substitutes this Order. Specifically,the Court withdraws its prior analysis of New Kids on the Blockv. News Am. Publ’g Co., 971 F.2d 302 (9th Cir. 1992) located onpages 10 to 12 of the Court’s March 22, 2002 Order and replacesit with a modified analysis located on pages 11 to 13 of thecurrent Order. The Court also withdraws as moot its priordiscussion of initial interest confusion located on pages 12 to14 of the March 22, 2002 Order. Finally, the Court modifies thescope of preliminary injunctive relief in light of its newanalysis.BACKGROUNDA.The PartiesPlaintiff claims to be the largest tax representation andnegotiation company in the United States. It specializes innegotiating with the IRS to eliminate or reduce assessed taxliability and to work out favorable payment terms. Declarationof Monica Linder (Linder Dec.), 4. Defendants are directcompetitors with Plaintiff in the business of taxrepresentation. Id. 5.
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3B.Facts Relevant to False Representation ClaimsBoth Plaintiff and Defendants advertise their services onthe Internet. Plaintiff’s universal resource locator (URL) iswww.jkharris.com. Defendants’ URL iswww.taxes.com.Defendants have published on their web site unfavorable information aboutPlaintiff. Prior to the issuance of the temporary restrainingorder in this case, Defendants’ web site contained a pageentitled “JK Harris Employees Tell of Wrongdoing WhileComplaints Pile Up.” On this page, Defendants describe afederal investigation of Plaintiff, criticize Plaintiff’sbusiness practices, and republish anonymous statements aboutPlaintiff from individuals identified as former customers orformer employees of Plaintiff. Defendants also solicitinformation critical of Plaintiff for publication on their website. Plaintiff contends that numerous statements attributableboth to Defendants and to those anonymously contributing toDefendants’ web site are false and misleading.C.Facts Relevant to Consumer Confusion ClaimMany consumers looking for services on the Internet use a“search engine” to identify the URL of the company they areseeking. When a user enters a name into a search engine, thesearch engine provides a list of web sites that contain thatname and, presumably, the information sought by the user.Plaintiff alleges that Defendants have manipulated the web sitearchitecture of taxes.com so that when a consumer searches forPlaintiff’s web site, Defendants’ web site is among those websites displayed. Specifically, Plaintiff contends that this was

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