Warby Parker fends off 1-800 Contacts' keyword ad case at US appeals court

Oct 8 (Reuters) - Warby Parker (WRBY.N) convinced a federal appeals court on Tuesday to uphold a decision that its use of a competitor's name to redirect search-engine users to its online contact lens store did not violate U.S. trademark law.

The New York-based 2nd U.S. Circuit Court of Appeals said that 1-800 Contacts [RIC:RIC:FENWYO.UL] failed to prove Warby Parker's keyword advertising would deceive potential customers.

Warby Parker attorney Roxanne Elings of Davis Wright Tremaine said the company was "delighted" with the decision. An attorney and spokespeople for 1-800 Contacts did not immediately respond to a request for comment.

Warby Parker, best known for its eyeglasses, began selling contacts in 2019. 1-800 Contacts sued Warby Parker in 2021, accusing it of unlawfully buying keyword advertising on Google and other search engines to show Warby Parker ads when users search for "1-800 Contacts."

A federal judge in New York dismissed the case in 2022, finding that the marketing was not likely to confuse potential customers. The 2nd Circuit upheld the decision on Tuesday, adopting the "consensus view" of other circuits that have considered the same issue.

"Despite 1-800’s emphasis on the allegedly nefarious nature of Warby Parker’s keyword bidding activities, this well-known internet marketing strategy — by itself — does not support a claim of trademark infringement absent additional use of 1-800’s Marks," U.S. Circuit Judge Eunice Lee wrote for a three-judge panel.

The case is 1-800 Contacts Inc v. JAND Inc d/b/a Warby Parker, 2nd U.S. Circuit Court of Appeals, No. 22-1634.