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Granite State Trade School, LLC v. New Hampshire School of Mechanical Trades, Inc.

United States District Court, D. New Hampshire

August 3, 2015

Granite State Trade School, LLC
v.
The New Hampshire School of Mechanical Trades, Inc

Page 57

For Granite State Trade School, LLC, Plaintiff, Counter Defendant: Frank P. Spinella, Jr., LEAD ATTORNEY, Hall Morse Anderson Miller & Spinella, Concord, NH.

For The New Hampshire School of Mechanical Trades, Inc., other, New Hampshire School of Mechanical Trades, Inc., Defendant: Thomas J. Pappas, Gary M. Burt, Primmer Piper Eggleston & Cramer PC (Manchester), Manchester, NH.

For The New Hampshire School of Mechanical Trades, Inc., Counter Claimant: : Thomas J. Pappas, Gary M. Burt, Primmer Piper Eggleston & Cramer PC (Manchester), Manchester, NH.

Page 58

ORDER

Landya McCafferty, United States District Judge.

New Hampshire, home to extensive granite formations and innumerable quarries, has long been known as the Granite State. The above-captioned dispute raises a novel, but ultimately basic question: are the terms " New Hampshire" and " Granite State" so synonymous that the public is likely to be confused by their interchangeable use in commercial advertising?

The plaintiff, Granite State Trade School, LLC (" Granite State" ), and the defendant, The New Hampshire School of Mechanical Trades, Inc. (" NHSMT" ), are both in the business of training plumbers, gas fitters, and other tradesmen. Granite State has brought this lawsuit, alleging that NHSMT's use of two website addresses (known as " URLs" )[1] is deceptive, and may cause prospective students to confuse the two schools.

Granite State seeks a preliminary injunction barring NHSMT from using these URLs during the pendency of the litigation. NHSMT objects, and the court held a full-day evidentiary hearing on July 7, 2015. For the reasons that follow, Granite State's motion for preliminary injunction is denied.

Background

Since its founding in 2006, Granite State has used the URL www.granitestatetradeschool.com . Through its website, Granite State advertises its services to prospective students, and allows students to register for courses online.

NHSMT was founded in 2010, and began offering courses in 2012. Like Granite State, NHSMT uses its website to promote its services and to allow students to register for courses. Initially, NHSMT exclusively used the URL www.tnhsmt.com , a basic acronym of its name. Later, however, NHSMT began using the URLs www.nhtradeschool.com and www.nhtradeschool.net in its advertisements. While the content of NHSMT's website still appears at www.tnhsmt.com , the www.nhtradeschool.com and .net URLs automatically redirect users to www.tnhsmt.com .

Page 59

In this dispute, Granite State seeks to bar NHSMT's use of the www.nhtradeschool.com and .net URLs. Granite State maintains that NHSMT's use of these URLs is likely to mislead prospective students into confusing the two schools because of their similarity to www.granitestatetradeschool.com .

The court will summarize the evidence offered at the July 7 hearing before discussing the merits of Granite State's motion for preliminary injunctive relief.

I. Granite State's Evidence

Granite State offered the testimony of three witnesses: (1) James Fusco, the founder and owner of Granite State; (2) John Brulotte, a former Granite State student; and (3) Karen Chansky, an internet marketing professional.

Mr. Fusco testified that he founded Granite State in 2006. Granite State currently offers four courses in gas heating installation and maintenance, all of which Mr. Fusco teaches personally. These are the only live courses that Granite State offers, though students may register for an online plumbing training and certification program, for which Mr. Fusco serves as an in-person mentor.

Mr. Fusco testified that to advertise its services, Granite State relies primarily on radio advertisements and direct mailings to prospective students. Since 2007, Granite State has spent some $58,000 on this type of advertising, or approximately $7,250 per year. In addition, Mr. Fusco testified that Granite State has used the URL www.granitestatetradeschool.com continuously since its founding in 2006, and has spent a total of some $19,000 designing and maintaining its website.

Mr. Fusco also testified regarding Granite State's financial performance. According to Mr. Fusco, Granite State experienced a precipitous downturn in student enrollment beginning in April of 2015, approximately the same time that Mr. Fusco first learned that NHSMT was airing a radio advertisement directing prospective students to the www.nhtradeschool.com URL. Mr. Fusco explained his belief that the enrollment decline is attributable to students confusing the two schools, and he noted that his secretary often receives telephone calls from students attempting to contact NHSMT.

Next, Granite State offered the testimony of John Brulotte, the owner of a pipe and gas fitting company. Mr. Brulotte testified that he had taken courses at Granite State in the past and had enjoyed working with Mr. Fusco, though he acknowledged that he could not recall the name of Mr. Fusco's school. Mr. Brulotte testified that, in April of 2015, he sought to enroll in one of Mr. Fusco's recertification courses at Granite State. Unsure of the name of Mr. Fusco's school, Mr. Brulotte conducted an internet search for " New Hampshire trade school." Believing he had found Mr. Fusco's website, Mr. Brulotte clicked on the first search result. In fact, Mr. Brulotte had found NHSMT's website, and he inadvertently enrolled himself in a similar course that NHSMT was offering. Mr. Brulotte did not discover his mistake until he arrived at Granite State to find that no such course was being offered that day. On cross examination, Mr. Brulotte acknowledged that he had been in a hurry and had not paid careful attention when conducting his search and registering for the course.

Granite State's final witness was Karen Chansky, a marketing consultant Granite State had hired to increase its web traffic. Ms. Chansky began her work by analyzing the traffic on www.granitestatetradeschool.com for the period of February to June of 2015. See Pl.'s Ex. 10. Reproduced in

Page 60

relevant part, Ms. Chansky's web traffic analysis showed the following data:

Feb. 2015

Mar. 2015

Apr. 2015

May 2015

June 2015

Organic Search

596

748

595

439

569

% Organic

73%

57%

55%

32%

31%

Referral

121

409

328

329

423

Direct

96

157

154

616

845

Social

4

4

2

2

3

Total

817

1318

1079

1386

1840

Ms. Chansky explained this data as follows. Internet users may reach a website through a variety of channels. At the most basic level, an internet user might reach a website by typing its URL directly into the internet browser. In Ms. Chansky's data set, these users would be captured in the " Direct" row. For example, this data shows that in March of 2015, 157 users reached Granite State's website by typing the URL www.granitestatetradeschool.com directly into their browser.

Second, an internet user might reach a particular website through a search engine, like Google. Using keyword search terms, the user will search for relevant websites, then access a particular website by clicking on a link on the results page. There is a catch, however, because not all links are created equal. On a typical Google search results page, for example, the links at the top are sponsored links placed there by merchants who have paid for the right to have their website appear in response to particular keywords. These sponsored links are known as bid-based " pay-per-click" (or " PPC" ) links because merchants bid on keyword search terms. If a website owner outbids his competitors, an internet user using those search terms will find the owner's website at or near the top of the sponsored links section.

Just below these sponsored links are non-sponsored, or " organic" links. Organic links are links that appear in the search results because the website content matches the keyword search terms, as determined by the search engine's algorithms.[2] In Ms. Chansky's data set, the top row captures users ...


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