Deltona Transformer v. NOCO — Keyword Bidding Alone Is Not Trademark Infringement

Background

Deltona sells vehicle-battery chargers under the registered BATTERY TENDER marks. Rival NOCO used “battery tender” in product advertising and also bid on Deltona’s marks as search-engine keywords. A jury found trademark infringement, unfair competition, and false advertising, awarded $1.3 million in actual damages, and the district court ordered disgorgement and entered a permanent injunction.

The Court’s Holding

The Eleventh Circuit affirmed the core infringement verdict but held that purchasing a competitor’s trademark as an invisible advertising keyword, standing alone, does not constitute trademark infringement. The court distinguished keyword bidding from NOCO’s visible uses of “battery tender” in advertisements and product listings, which supported the jury’s infringement finding.

The court also reversed the false-advertising verdict because Deltona had not pleaded that distinct claim. It rejected the view that scattered references to advertising and a general citation to Lanham Act § 43(a) supplied fair notice. Because the jury returned one lump-sum damages award covering theories that could no longer stand, the court vacated that award and remanded for a new damages trial. It otherwise affirmed the infringement and state unfair-competition verdicts, disgorgement, and permanent injunction.

Key Takeaways

• Competitive keyword bidding is not itself trademark infringement when the trademark is not displayed to consumers.
• Visible use of a rival’s mark in ad copy or product listings remains subject to ordinary likelihood-of-confusion analysis.
• A complaint must give fair notice of a separate false-advertising theory; a generic reference to Lanham Act § 43(a) is not enough.
• A general damages verdict must be retried when it may rest on legal theories later removed from the case.

Why It Matters

The published decision gives advertisers and trademark owners a clear Eleventh Circuit rule for search advertising: buying a competitor’s mark as a trigger is different from showing that mark in the resulting ad. It also highlights the procedural risk of combining multiple Lanham Act and state-law theories into a single damages verdict.

Surfaced via Eric Goldman’s Technology & Marketing Law Blog.