NameSafe, an identity protection company headquartered in Nashville Tennessee, filed suit on Wednesday in Tennessee against their competitor LifeLock. The suit alleges various violations of Trademark Laws and the Tennessee Consumer Protection Act. At issue is the allegation that LifeLock bid on the keyword ‘namesafe’ in major search engines and according to David Ridings, founder and CEO of NameSafe, had the phrase ‘Namesafe.com’ in the text of their ad. Ridings had this to say in a press release issued by the company.
“We have discovered that LifeLock has been sponsoring advertisements on most major search engines including (among others) Google, Yahoo, Lycos, MSN, Dogpile, and AOL, that deceptively led consumers to Lifelock.com. Specifically, when you searched ‘Namesafe.com’ in any major search engine, you found an advertisement that said ‘Namesafe.com’ but when you clicked on it, you were not directed to the official site for NAMESAFE (www.namesafe.com), but rather to our competitor, LifeLock.com. It is one of the most bizarre attempts to steal a company brand and its costumers that I have personally seen.”
For those unfamiliar with search engine advertising this is how it works. A consumer types a keyword into the search engine, lets say Google, and Google generally returns two types of results, paid and unpaid. The unpaid results, known in the industry as organic listings, are based on Google’s algorithm and are located to the left and center of the page. Paid results, known in the industry as Adwords in Google’s case, are located at the top and to the right of your screen and are paid advertisements.
LifeLock paid Google so that their advertisement would show when a consumer searched for ‘name safe’. LifeLock wasn’t alone in doing this as their main competitor Identity Guard was also bidding on these keywords but Identity Guard never used ‘namesafe.com’ in their text ad. LifeLock, in an article by Stephen Shankland on CNET, say they did not use Namesafe in their advertisement either. They believe it was one of their 3000 affiliates who did and said they terminated the offending affiliate and warned other affiliates to stop bidding on the keyword ‘namesafe’. Identity Theft Labs can attest to the latter as we are a LifeLock affiliate. LifeLock believes the offending URL was www.livelock.com, an ex-affiliate that redirected any clicks on their advertisement directly to www.lifelock.com, the real site. This was done by quite a few affiliates in all types of industries before Google wisely put an end to such redirects by requiring that the visitor be taken to the URL that is displayed in the ad.
IdentityTheftLabs.com has been involved in the identity theft advertisement field for the past 6 months, and it was very common for all identity protection companies to be bidding on each others trademarked keywords until recently. Recently Lifelock started the process of emailing other companies, placing a phone call or sending a letter to have them stop bidding on their trademarked names. Most competitors complied and LifeLock in turn stopped bidding on competitor keywords. Identity Truth is the only competitor still bidding on LifeLock’s keyword and even after all this time LifeLock has not filed suit against them.
NameSafe decided to take a different route than LifeLock and filed a lawsuit prior to communicating. This is unusual, as one usually asks for the advertisement to be removed or to have the text changed and if this does not work then a cease and desist letter is sent. It is only after the cease and desist letter is ignored that one would ponder a lawsuit. So why did Namesafe take such a heavy handed action? In a brief chat with Identity Theft Labs, CEO David Ridings said the lawsuit was launched on the advice of his counsel as a cease and desist order may have opened up litigation in Arizona where LifeLock is headquartered. Ridings explained further that they initially contacted Google, about 4-6 weeks ago, and Google’s response was that they do not get involved in trademark disputes. Ridings contention isn’t that LifeLock was wrong to be bidding on their keyword but that they confused a few of his customers by having ‘NameSafe’ in the text of their advertisement and as such they felt it was necessary to protect their brand. Nothing wrong with that but since LifeLock says that it was one of their affiliates who created this confusion maybe the two could have saved each other a lot of legal fees by opening up the lines of communication. In the end we expect they will come to an agreement outside of court but the line of communication must be opened first. The question is, who is going to extend their hand first, Ridings or LifeLock CEO Todd Davis.