begin by hearing argument in one thousand eight hundred contracts versus have to see thank you thank you your honor stephen fishbein for the petitioner one thousand eight hundred contacts your honors ten years ago my client one thousand eight hundred contacts settled a trademark infringement lawsuit here in the southern district of new york the parties agree that neither would use the other's trademarks to trigger a paid internet search ads like dozens of other settlements entered every day in this courthouse the parties believe that their dispute had been rest and would not be nd guessed years later st these settlements were arm's length and in good faith the f t c concedes that and in this case that is a significant issue there was an extensive factual record here the f t c interviewed deposed and called as witnesses the counter parties to the settlements if there was any suggestion of collusion or that the trademark issues were pretext or all that would have come out it did not these are nothing more because  one question about the little moments one feature did strike me as unusual which you didn't mention one of the provisions of the settlement is that  search results and you were other cases in which a trademark settlement involves something like that i mean this is an interesting issue about whether it's a use of the trademark to bid in this kind of auction on your trademark but wouldn't have thought it was an interesting issue that someone can't bid on advertisements that use the word contacts or contact lenses without explicitly clear there was no restriction on running ads against generic terms like trademarks the settlements were all very clear that the competitors could run their ads if somebody searched for contacts or contact lenses term yes and that's a corollary to the nine use provision that's necessary to protect the trademark and let me explain the mechanics one way of if i'm a competitor running my ad against one thousand eight hundred dollars trademarks is to go to google and say i will pay you if you run my attic and one hundred dollars contacts now i can also put on the work contacts i have enjoyed and the mechanics but i'm trying to understand you know you don't have it seems to me because me if i'm and if there were such a thing if there were an app where you could look for every billboard in the country that has a one thousand eight hundred contacts number a make it your business too rent the next billboard on the road to have such an ed there's nothing wrong with doing that is there not that i'm aware of so why and let's assume that it is not just a good faith thing let's as the claim let's assume that you're even right that those practices are distinguishable from beating on your trademark as a search term at least in that instance the competitor is using in some sense your trademark in negotiating with google it strikes me as a bridge quite a bit further to say they're required to somehow avoid and any bid that would land their ads there even if they're bidding generically what i want to explain is it's still using because the advertiser has a choice as to whether to just bid on contacts with exact match or to say to google i will pay you extra if you run my ad on any search that includes contacts knowing that that will pick thousand eight hundred dollars contacts of course i know that that's got that's a part of that is a problem with the fact that your trademark is not a strong mark or maybe the whole thing is a mark but you're utilizing a generic term in a way that is if you give it as broad a sweep as you are thinking about it gives you a lot more then you may be entitled to a valid trademark and i want to challenge that there are methods to challenge trademark but is so long i know but if you were if you were kodak they wouldn't be able to do this to you by bidding on film i mean remember when there was kodak and there was no they they wouldn't be able to do this to you it's really just because your trademark encompasses the very generic term so i'm having a little trouble understanding that aspect of the settlement  as to why that would be a legitimate thing i mean i don't think you even and in the lawsuit that was settled was about i thought originally the claim and maybe i'm wrong about this too was about their affirmative use of there were cease and desist letter was obvious and the number of settlements but this broad matching issue was definitely definitely raised but look the confusion is that when a searcher puts in one thousand eight hundred contacts expecting the results to be related to that something else comes up for a competitor and that's what the courts have said that is potentially confusing functionally it's exactly the same if i do broad match contacts knowing that's going to pick up one thousand eight hundred contacts as if i that on one hundred contacts directly it's functionally the same and unless you have the negative keywords the result is going to be the same one but the result of why is the result problematic what is problematic is their use of your trademark tourney to use turning to use i would say why is it not a use if i memorialize that's an actual counterparty memorial i testified in the f t c they were asked did you run trademarks on one thousand eight hundred contacts answer yes did you directed no how did you do it well we did for contacts and we selected broad match and knowing our ads would run against one thousand eight hundred  generally the log does not allow you to do indirectly which are prohibited from doing directly and if the intent of the party is to run the ad against one thousand eight hundred the intent is and all of the billboard examples is to run an ad against your ed right the issue with the billboards is i think courts would generally say it's not confusing because people in the physical world are well equipped to differentiate two different billboards and know that it's two different suppliers even  know that i mean no no no no no i mean in twenty years from now we're not good when all of our kids are up there and doing this stuff we're not even going to be having this conversation and perhaps in twenty years the situation will be different but the courts that have ruled on this and certainly back in tw forty two thousand and nine when we were doing these settlements the courts ruled that it can be inherently confusing to run an ad against somebody else's trademark and these comparisons physical world only goes so far i mean i think people again are well equipped to know what store they're walking into whether it's a starbucks or it's the java joe next door you kind of have a sense of where you are the internet is different it is confusing there are surveys after survey some of them cited in the cases like rosetta stone people do not know the difference between advertisements and organic results in a moment ago that the competitor has a choice between doing the broad match or including the keywords so is there a difference in what they're choosing to advertise on do they pay a different price if they have the exclusionary keywords or is it just an extra disavowal of certain surgeries with a price depends on who else is so i don't think the price of fairies based on specific match are broad net and only varies based on the generic he were in that you're betting on right now the exclusionary keywords don't factor into the prize it factors in the following way if you suggest broad match your ad will be paired against many more search terms so in effect you're saying i'm willing to pay more if i do just somebody else's bidding against contacts but has an exclusion for one hundred dollars are they bid against each other i don't know the answers that your honor i'm not sure the record reflects that but i would point out that it is an affirmative choice by the advertiser to do broad match they're likely to pay more for that because it's going to match against more ads and that's the way they pick up one thousand eight hundred contacts by betting on contacts your honor you asked if there are other cases there are and we cited and there in the hogan report which is in the the appendix and we cited them in our brief there are several cases of default judgments or consent judgments ok where the courts did impose negative keywords i think we cited for fun of them and so those courts obviously viewed the negative keywords as part and parcel with direct betting and the f t c has taken the same position at oral argument and the f t c one of the commissioners asked f t c counsel there's two different issues here isn't there there's direct bidding and then there's the the negative keywords and have to seek counsel responded it's a distinction of degree not of kind we obviously did not make a demonstration of what the effect would have been had there been no negative keyword requirement so they are proof of impact of a fact of everything was of the two things combined there's no basis in the record to separate the negative keywords from it maybe there should be and one of the things th approach gave insufficient weight to the interests of trademark holders what follows from that what kind of relief would be involved may be a possibility would be to send it back to the agency if for example we thought that some aspects of these overreach and others did not i mean your honor our position is that you have to see had it had had plenty of opportunity to develop the record they chose their theories they chose not to differentiate between the keywords negative keywords and the other effects they had no independent proof about the negative keywords and i don't think that should get into over i mean we'll just keep going back and forth but let me let me address a threshold issue with the point where you start there's just i'm trying to avoid doing what i did yesterday so i'm going to give you another eight minutes and we're going to give the government another zero dollars ten cents you're now two minutes over and  we'll watch the clock ok thank you thank you i think that at the threshold this case is really controlled by this court's decision in clorox in the supreme court's decision and activists in clorox the court said that trademark settlements are favored in the law because they are non exclusionary and that absent evidence of some auxiliary purpose in other words that the trademark settlement is ancillary to some other a legal agreement they should be respected those conditions are clearly present here as i said clearly not exclusionary this applied to one very narrow type of paid internet advertising which is trademark advertising the competitors were free to get their message across through bidding on generic terms through social media there's many many different channels generic terms organic display ads social media product listing email ads mobile apps not to mention non internet advertising like print radio and t v so it didn't for cloves any body selling whatever products they want any prices they want in the in the terminology of clorox there may have been some slight imposition on the effectiveness or efficiency with which some of these competitors could get their message across but that flows from the trademark rights and by no means were people barred or prevented or really limited in looked at whether there was sort of advertising and what and the amount of advertising that went on and trying to use that as a proxy for limiting the market or the market having been limited can you focus so i can what their exports look that is whether the number of advertisements that ran against the one thousand eight hundred dollars trademark went down or were lower than they otherwise would be since the whole purpose of the agreement is to say you can't advertise on the one thousand eight hundred trademark we don't disagree with that clearly that was the effect that was the intent and that was the effect but that doesn't mean that the overall body the overall volume the overall message is of advertising to consumers was reduced because there are so many other channels and a number of these that yourself the internet is different and it seems to me that google searches or are different everybody uses either google or some alternative search engine to find out what's on the internet and those companies rather annoyingly to the consumer that's the price of getting a free service i guess i have stopped matching my search with what is actually most connected to my search but instead stick in something that they solve up front that becomes a seems to me almost uniquely significant way of hitting consumers and right i mean the real thing you're worried about is if somebody is saying we're cheaper than one thousand eight hundred contacts what place they could advertise is more likely to hit the consumer who's interested in that information then somebody who puts in either contacts in general or one thousand eight hundred contacts as a search and if they put in contacts they will see the competitor ad if they just put in contacts they see it and the record showed according to google's information that during the relevant period there were over one billion paid search i'm just limit search we're not talking about display ads or social media or anything else one billion paid search ads for contacts were run by one thousand eight hundred competitors during the relevant period so that means between generic terms in settlement forms of thought for the reason of taking that form to resolve it and it was like reality but it's not the commission says the activists only says liability and it doesn't move these settlements are immune from any kind of scrutiny and they say that you should be able to give your pro justification that it's a settlement and they would take that into consideration at that stage of the nelsons does a lot hinges on where it comes in in the analysis what is the difference between those two positions you are let me let me address it this way yes i think you characterize our position correctly i would say that the  key issue from activists is that when the f t c briefed it and when the supreme court decided it would made that reverse payment unusual was that it was beyond the scope of relief that any party could get if they had prevailed in litigation whereas here and this is critical every single one of these provisions in these settlements has precedent in other cases where courts have and did order nonuse including negative keycard my question is if we say that this is a commonplace does that mean that you don't even get to make a prime official case or it means that that is the pro competitive justification and they can't overcome that you dress it as anything does anything hinge on the distinction yes i think i think there's a couple of ways that could come up one would be like at the motion to dismiss whether there's immunity and i think they overstate it when they say we're asking for immunity because here there is a fall factual record what we're saying is when the full factual record shows that it's arm's length good faith not exclusionary and within the scope what you would have gotten in litigation then there is no and i competitive effect so you don't get past the st problem there's no competitive justifications as in clorox you simply say that is not an effect that's an effect that flows from a legitimate trademark and that is not recognized as an anti competitive effect for and i trust law which is i think the way they did it in clorox and what is the threshold for an unusual if there are i mean there are certain kinds of trademark settlements and claims that are absolutely standard we see you know hundreds of them in the circuit and yulee i'm sure other  unusual or just mumble and what difference does that make if it in other words i'm not trying to text you necessarily with the idea that you've done something on when thousands of cases have not reached that far  neither seems to me are you able to say this is something that's an every day event this is something that's novel i don't think it comes down to whether it's typical or the percentage of cases i think it comes down to whether it's something that you legitimately could get whether it is a plausible form of relief and know that in activists the parties didn't even try to say that this reverse payment was something they could have gotten litigation the way they justified it was that the  d the generic was providing services that there was some extra you know patent agreement here i don't think there's any dispute that if we had been successful and numerous courts recognize the the  initial interest confusion trademark theory if we had been successful we would have been entitled to an injunction that said you cannot use our trademark for for advertising and the negative keywords so it's the question is simply is it in the scope of relief that you could have gotten had you litigated not that the clear consensus of decisions were in your favor but even if it was an open question if you were successful could you have gotten that and once we established that and that i good faith arm's length it's not exclusionary there's no reason to go determine what relief you could have gotten without evaluating the plausibility of the claims are sort of looking into the claims you don't reassess the facts because i think the idea is that you presume that parties acting at arm's length are in the best position to assess their factual position you say assuming one thousand eight hundred contacts factual claims were true and both parties apparently thought they were true enough to reach the settlement then as a matter of law is this something that they plausibly could have gotten any answers really as yes from the president but there may also be a question of legal theory right there and in all of these cases it's fine to say that the parties are in the best position but we all know there's a difference between big parties and little parties there are such things in the world i would certainly suggest that you are one who are trademark bullies  no evaluation of what the underlying law might be particularly in novel areas your honor let me address the st point because you know one of the selling parties was walgreen's which is two hundred times bigger than one hundred contacts on a revenue basis another one was len's dot com which is not a big company but felt they had a strong factual position and limited ends us and won so clearly it was open to these counter parties to resist the ones that settled settled because they wanted to settle there are other grounds to get behind a settlement other than sham as clorox says if the trademark agreements are ancillary to some other illegal purpose and they cite for that proposition a case called him can where people divided the market and subsequently came up with trademark agreements to kind of paper over and agree and market division and the court said look the trademark issues here ancillary to what was otherwise agreed and unstated so the courts can test settlements to see whether there truly arm's length obviously if there is direct or something like that you could get into that and that's why i say it's so important that in this case all of these counter parties testified and there wasn't a hint of overbearing assert to ras or anything like that they all said we settled because we have value added the position we didn't think it was worth spending a lot of gays and cost in light of the risks that we face for this court to go behind that and to start nd guessing parties sincerely gentlemen evaluation of where they stand on the law i think that's a dangerous game and that's something that's been cautioned against an activ you know net many of our cases thank you mr fish fine you reserve two minutes for thank you and you'll probably end up with more as you can thank you thank you when we give the government twenty five minutes at least to start in fact not about trademarks trademark the law protects st marks to the extent that there is a likelihood of consumer confusion these agreements fourteen of them covering nearly eighty percent of all online sales of contact lenses banned advertising and ads that did not could not have been confusing it banned ads that did not use the trademark at all one of them the exotica agreement did not you did not even involve trademarks and was not even a settlement of litigation it was a simple supply agreement that one hundred they're not separate argument about the supply agreement may be should be evaluated differently but on the settlement agreement isn't saying that there is no possibility of confusion i'm just assuming the outcome of the litigation so in your brief and what arguments complaint counsel made before the commission is that it doesn't matter the strength of the claims underlying were not litigating underlying trademark claim and if what was an issue in the underlying case is whether it was confusing if you're telling us to rely on the premise that it was not confusing aren't you then saying that we need to look behind ads regardless of the content of the ads and that starts out by saying we are not wasn't the theory of the suit that it's confusing to somebody if they google one hundred dollars contacts in the st search result even though it says ad is something else you might think that you're getting to what it is when in fact you're not absolutely in fear of your honor that's correct in practice however the expert the f t c expert testified that he has reviewed over one hundred opinions involving the search term confusion not a single case not one based liability for trademark infringement theory it's also the case that even if that is fairly settled when they were faced with this right right now we're talking about number one that not the ones that that settled but that's that's my point that that in fact right on the theory but in practice that's not the case because at minimum at minimum one in two hundred dollars could have just said look if there is an ad that says we are not affiliated with one thousand eight hundred dollars contacts that's the st thing you based on that theory if there is diminished confusion there are ways to do with that to protect the trademark then american thing isn't it sort of already clear another website and know the disclaimer is addressing whether i'm confused as to which website i'm at but if we're talking about a theory of initial interest confusion which is what the courts and the courts described and it's when i see the and in response to the query whether i'm confused if it's responsive to my query isn't that the theory is that cured by the disclaimer that i would think i would think it would be cured if if i type one hundred contacts in my into my search engine and i see the st link that is displayed or not the st thing that is displayed in hundred contacts into a search engine one hundred is claiming that digital space as its own exclusive territory and has agreed with its rivals that they would not advertise in that territory and vice versa this is exactly like blackburn versus sweeney out of the seven circuit where lawyers and former law partners agreed not to advertise in each other's regions and the southern circuit found  unlawful that's an interesting thesis and that leads to the question so how come one thousand eight hundred contacts is on the down side of the v and none of the people signed agreements with them in other words you're not charging the other competitors with entering this agreement to not enter each other's space to be your honor because one thousand eight hundred contacts is far and away the largest player one hundred contact is the common denominator in all fourteen agreements they are the ones that are in fact insisting on these provisions and contrary to what my colleague it said there are in fact so i can't i can't speak to why the complaint counsel picked one defendant versus another but certainly in practical terms you could see why one they don't think this is a sham i assume we'll hear if i'm wrong about this that one hundred dollars contacts would also agree that agreements like this outside the scope of trademark would be unlawful these are outside the scope of that of the trademark here and how you mentioned how deeply do we need to get into trademark law to decide that perhaps no more than what are the three elements of trademark infringement you need to have a protectable trademark they have that there needs to be a use that's an authorized there needs to be a likelihood of confusion on those last two we are what the commission found is these agreements go way beyond those because they are bar band agreements regardless of whether they could be or could not be confusing including the initial confusion theory e are our issue is not with the trademark claim that they have issue is with the agreements restraints were saying that the restraints in the agreements went far beyond what the trademark so they use they lose their even regardless of the likelihood of confusion because the rival did not use one hundred contacts at all either as a keyword in the search or in the ads themselves agreements that had those provisions that's a very different issue actually that's useful as a transition so so this gets us to the chlorox questions that we have in the absence of some kind of underlying legal agreement or extraordinary circumstances we should defer to the parties sense of what is necessary to protect trademarks so even even under that standard your honor the commission found based on substantial evidence that those exceptional circumstances exist here they are and they are that ban applied without any reference to the content of the ads if you recall in clorox the the typical settlement that was there was in fact very detailed about what can be used and what cannot be used in ads and how they can be used and all that none of that is here it's just a straight back and that's one to the the term for the use of negative keywords insisting on negative keywords when there is in fact no use of the trademark three the restraint that applied in clorox was one product with one rival with plenty of competition around here we have fourteen agreements covering almost eighty percent of the market higher subject by the commission in other words is there a separate finding that looks out of that agreement itself violates the and the trust was without reference to these grapple with what's happening in these cases where you have a trademark litigation being settled well with what that what it does show your honor it is this is not about likelihood of confusion this is not about trademarks this is about one hundred dollars protecting its much higher price against its rivals that's what these agreements are about they are not about protecting trademarks because they could have protected their trademarks with much easier way that would not have gone so far as to ban all ads and protect it's really have been more likely that a rival of one hundred contacts would read to put in big letters right in the middle of their advertising  a commodity market so the exact same market contacts for much less if i were a rival and i had the option of not putting any ads against one hundred contacts where it's also on the record that that is my principal means of getting customers versus the other option is i put in an ad that says we're not affiliated with one hundred dollars contacts we can sell you the same contacts for fifteen percent plus say in effect which one would you take it would say in at all constrained in setting prices by the price of the sellers and brick and mortar stores like these are two dollars separate market they are two separate markets absolutely that's what the l g found and that's what the commission adopted for purposes of its analysis and it did in fact rely on it  if i may say on page on page two of its opinion it says we find that the agreements harm consumers and competition for the online sales of contact lenses on page thirty four it is while the contracts do not prevent  all advertising for the online sale of contact lenses it does it does for close a major channel of competition one hundred contacts whole business model trying to capture consumers who are going to the brick and mortar retailers and telling them hey it's cheaper to buy yes absolutely isn't it sort of artificial to say that there are only in this online market and that's different from physical market the market of brick and mortar stores well it depends on food purposes of what before purposes of these agreements all of those rivals were in the online market they were not in the brick and mortar market at all and we're talking about whether one hundred dollars contacts had super competitive prices it was raising price or something about what the commission price in comparison to the other online retailers are also if their whole model is to compete with the brick and mortar stores don't want to take into consideration what the price in that market was to or think of that is one so it's in that market that we are evaluating the restraints and it's in the market that the commission found that but for the restraints the prices would have been lower what's the reason why i should think of these as two separate markets even though the all the factors that are in brownish so it talks about how the retailers in that market view themselves do they view themselves as competing against brick and mortar i mean i grant you what you say in that one thousand eight hundred s business model is to price lower than the brick and mortar but not entirely all of that what they do is they're priced lower than the independent  i care professionals and not quite as much as places like costco for example but that is how they started but that's not where the market that we're talking about now is it's about not saying that there could not be a relevant market that also includes brick and mortar absolutely that could also be a relevant any trust market but for purposes of this these restraints and these agreement the question is is the only sale of contact lens is irrelevant market and the l g again very in very detail findings found that it is in fact distinct and relevant and you trust mark so because there so this discussion well it's not it's not that there's a it's a little bit nuanced i guess i need to say because let me also highlight that the commission found that there were actual direct effects there was actually the average price in the market where i was up was higher because of these restraints and when you have direct the facts you do you don't need to define the market too in the typical contacts than from the sellers because you'd have less diversion from the ads correct absolutely so when you heard sales direct effects we think that there has to be some kind of shown at their super competitive prices right so if it really was also competing with the brick and mortar stores and their prices are significantly less than maybe they're not super competitive prices is that the market definition does seem to matter to you you beat me to it you're on so when i was saying is that for direct effects you don't need to show the detail market analysis in the sense of sheer is a market power but you do need to get to have an idea of what market are these people competing in you know they're not talking about our glasses we're talking about contact lenses and we're not talking about brick and mortar we are talking about online contact lenses so that's where these findings from the in fact become relevant so the commission did and like i said there are at least three or four specific explicit statements where the commission references that particular market if i may shift just very quickly to activist one i understood my colleague to say and i'm and if that's the case again the commission found based on substantial evidence that even if that if in fact everything they say about activists was correct and we don't agree with that we think those statements related to the two particular examples that the dissent in activists had raised but even if you take their theory to be correct these agreements were not commonplace supplements for the reason that i mentioned before  well how do you think we should tell what's a commonplace agreement and what's not for example in clorox i have no problem saying that is absolutely commonplace the question was is pine sol and lysol the same kind of trademark and are they confusingly the same and the parties settle the agreed that one wouldn't use the other in certain ways are fine and that seems absolute garden variety even i understand that much trademark what do we do with a scenario where there is a novel writing kind of trademark situation in other words maybe the reason this is unusual is because it's dealing with a relatively new form of competition a relatively new form of uses of trademarks i was very impressed with the commission's footnote whatever it is thirty eight that has that long  cases where claims like this last but at the same time can disregard what one thousand eight hundred says which is if you put it back to the date if you only look at cases that were extant at the time they were st doing this they were bringing claims that ok their novel because this is a novel situation and it's a little harder to say oh this was frivolous concern then they should have no concern about the commission's order because the commission's order is only prospective all that the commission was saying is these agreements we rule today are any competitive you should not in force these agreements so even assuming we don't agree with that but even assuming that the law was in fact unclear at some point for some of the settlements by the time they got to their own kids in the th circuit i don't think that that excuse holds water but more to the point of the just trying to get understand how this interacts with the process of litigation so you can have a legitimate settlement agreement that was arm's length and in good faith that settled a reasonable claim as of that time but by ten years later we recognise that there is a different world out there and and that's how that's the that's our system of law and when you say those are in fact wrong that the circuit court decisions that found those agreements to be not subject to this brings us back to the question of does this become a trademark case where we are we are having to decide whether their claim or not even were or not from the vantage point of the law as it is today we would have to decide that their original trademark claims under today's law are no good we're not asking again i make a distinction between the trademark claim and what the agreements restraints did their trademarks claims were not sham what the commission found was that the agreements that's why they were not common place it's that it's the disclaimer for the confusion side there is no use at all in for some of for some of the ads that were banned there was no use so that's also there's no trademark claim there at all and there now i might be inclined to agree with that sound sensible to me as a beginning matter anyway but i'm not sure that the parties here have litigated that actually right i mean  that came up if it's like ones that come somebody for that and then we got an appeal from some decision about whether that is or isn't a valid trademark claim we'd have to decide that and we decided based on for everything from parties that we're fighting the trademark case you're kind of asking us to decide the trademark issues that are there saying that you do not need to know what trademarks are of course not we're saying you do not need to litigate the merits of the claim what you need to know as far as trademarks is concerned is what do you need for trademarks you need a trademark use and confusion between this and of the merits of the claim because when you say this is not a use mr fishbein says no it is a use it's a funny kind of use but it's a use and when we do we have to decide somewhere along the way in this case that that is actually not a valid trademark claim because that is not that that's a fair characterization of what the commission did as well and with respect to not the negative views but the affirmative where it seems to me there's also an argument that that's not what use means in trademark  but there's also another argument that of course it is they're using our name in the course of this process when we have to well if you say it's a motion to dismiss standard that we're applying and we could dismiss the case with no affirmative use of their name right rescue dot com says we couldn't dismiss the other claim but so then you have protected their trademarks in a way that is less any competitive than the way they did and the commission found that yes at minimum they could have required disclaimers but doesn't that you see that's also a trademark law issue is it not whether that would sufficiently dispel the initial confusion if because the argument is maybe the argument that mr fish making is that god help them there are lots of people out there who are not as sophisticated even as i am about this market and somebody might say oh i google one hundred contact not even read the disclaimers not read anything top thing is this let's start from the top and work down i click on that now when they get to the website they might learn to their happiness that they didn't get from one thousand eight hundred contacts which is what they were trying to do but landed somewhere else by some mystery of the internet and that somewhere else serves their needs better get that but we're not talking about their website what the commission found is exactly but my point is why is it wrong to think that there are lots of people out there who when they google want to eight hundred contacts doesn't realize that google is not their friend and that google is selling them out to advertisers and so they just immediately click on the  st thing without even reading it because they think they got what they asked for which is give me one thousand eight hundred contacts website if that was their claim your honor they did not show it before the commission fact so they have to win their trademarks case before the commission in order to they're the one that put in the trademark as a justification they need to make that when under any trust law the justification cannot weight to be given to the idea that this was a settlement at arm's length between two parties who presumably evaluated the merits of this claim and made a decision about how strong it was and what it would justify by way of relief because in order to survive later antitrust scrutiny you would have to show that not just that this was a reasonable settlement that people made under the state of  at the time but that their claim was actually a valid claim that they would have won and they were won on the merits and they would have won this relief well your honor it's the part about that this is a reasonable settlement that the commission found is elements all are and found that the agreements ban ads could not possibly meet those elements so to that extent yes that's just for the negative you said for the negative use of the market cases there the trademark claim to see if there really is confusion or there could be a better way to cure it that's less restrictive and because there is it doesn't prevail but every step of that analysis is a litigation of the trademark claim in that sense it again you need to you need to opine on the trademark claim to the extent that you say the negative keyword is not even a use so you cannot have a claim there and that for purposes of the affirmative use of the trademark any confusion because it's the minimum there are people that in fact would do that but there is evidence in the record that that confusion was de minimus and for de minimu to think that with respect to the negative views that's not even a use that's like somewhere out of the furthest left field trademark law and they shouldn't be allowed to do that that's something you could never have gotten and litigation but that the issue of whether consumers are confused or not is something that was a legitimate ground of litigation at the time that the parties made a decision about how that should be settled and that we should not go back and revisit that in the guise of antitrust law what happens then i realize you think that's not anything  is that important enough to be an address violation or whatever is is should you get another chance then another bite at the apple to do that i can give you a two part a two part answer the st one is you absolutely can just send it back to the commission and see deal with the negative keyword but to tell you how important a negative keyword provision is because if you only strike down at negative q if you only strike that provision their entire case collapses and competition is brought back many more you know i was one of the examples of their their rivals memorial i did not bid on their own  their trademark they bid only on generic but they refused to put in a keyword and they stole customers left and right and center from one thousand eight hundred because if i hundred contacts i'm going to see the memorial i add know what you think we should do if we were to reach that conclusion that you don't want us to reach would be to modify the order and affirm it and that is in the search engine right and it works that you get an ad for memorial day you can get it and you go buy it more alive under your theory because it's cheaper and you write memorial i can't do that anymore because they sign an agreement in the morning i can't do it anymore because they're out of advertise on the keywords and if they are selling under the price that one hundred contacts offers are we just talking about people who otherwise would immoral are going to some other advertiser remember your honor that the agreement cover almost eighty percent of the market so those are the great majority of retailers in that market are covered by those agreements what would happen if you were to only invalidate the negative keyword requirement is all of those rivals advertisement would still show up if they bid on only generic and somebody searching for one hundred dollars contacts then their ads would show up that's what google does because they're  so in that sense it would solve a big part of the competition problem so it's not about eleven rival it's the fact that these restraints are completely bad and advertising for the great online lenses are cheaper and so they put in when and how contacts to see what's what comes up as as your as you're on a mission and you're on a mission there is a reasonable expectation now that when you put in as a term in a position that we have to re examine the merits of the trademark claims arks is extraordinary let me point out two things one is that that reality geisha is not only a question of law but a question of fact because it's likelihood certainly applies to the argument of the do something that is concededly or at least will pass muster in this circuit as a use but with respect to something that may not pass turns out that somebody else actually litigated that case and won that case that you could've litigated you're still stuck with the agreement that's fine because that's as between you and your adversary but this isn't one of those adversaries trying to get out from under something they voluntarily agreed to this is a government agency that has an interest in protecting consumers in the antitrust space and it seems to me that's a rather different thing when years later it turns out that a lot of competitors folded and now the law looks a lot different and we still have these legacy agreements that hurt consumer not the other people who signed them i would say two things obviously the interest in settlement is is very strong people settle cases precisely because the law is uncertain and if the situation was that any time the more uncertainty the more likely it is that my settlement will be challenged it's a disincentive to settle and i say it's also true that if it is correct that the law has changed to such a degree that you could not sue anybody today and win then give the judge business go into contact lens business because it's a great space for me to open up but maybe that's true and maybe it's not and if it is the best proof of that is what's on the market if somebody else is going to  challenge you on the ground that yeah you managed to beat these other people down because they were unwilling to fight no lens dot com has paved the way and the rest of us can get into this market and we'll be braver about facing any claim of yours that we shouldn't be allowed to do it and that has not happened and i also want to comment that the f t c said this is prospect of only that's not really true we're facing massive class action liability based on this f judgment if this court were to conclude that from today going forward the law has changed enough that perhaps on provisions should be modified has to be made really clear because we cannot be facing these you know hundreds and hundreds of before functionally it is exactly the same it is causing an ad to run against my trademark in rescue they pointed to two factors that made it use one was that the ad was triggered by an actual trademark and no l that's true with broad matching in the nd which distinguish it from pop up that because there was a prior case some pop up ads was that the advertiser had some discretion and control over which words the ad ran against and that is true in the case of broad match because it's the advertiser that selects broad match versus exactness and as i said this is in other words this is not accidental advertising on our trademark they deliberately in this memorial i testified to this they deliberately chose the brad that broad match and knowing that the ad would run against ours that's a use and clearly you know it was plausible that would survive a motion to dismiss so i think we are on safe ground there as i understood one of the main arguments from the f t c is is this sort of over breath that the settlements restrict advertising regardless of content but that is our claim our claim is that there is confusion notwithstanding what the content is rescue come stands for that he said there were no cases soile works as a judgment on the merits that stance from the australian gold stands for that hearts on fire stands for that we have numerous cases that saying irrespective of the content the mere placement of an ad immediately before below the search is confusing and then finally on this issue of we are not one  hundred contacts because i think in terms of the over breath and in terms of what the f t c is saying we should have done that's kind of what it comes down to and i think your honour's understand this not a single witness in the c said if only we could run an ad that said we are not one thousand eight hundred dollars contacts there is not evidence that the other competitors that were not bound by these agreements view that as a significant search term we are not dollars contacts the settlement agreements each have a term that says prohibit it actual not include use of the other party's trademark on the internet in a manner that would not constitute an infringing use in a non internet context e g the use of the internet for comparative advertising so comparative advertising is flag in the settlement agreement as a permitted use now granted there may be some ambiguity as to whether an ad saying we're not one hundred dollars contacts would fall within that no one came to one thousand eight hundred dollars contacts and said we would like to run that ad we think it falls within that within that provision and also leave agreement allowed in a that's and we are better than one hundred contacts because that's the comparative use right here i mean if you want to never let the parties seem to think that resolving the litigation required more than that is that correct you certainly could run an ad saying we are not wanted we are better than one thousand eight hundred contacts and social media display ads and all these other channels if you ran an ad we are better than one hundred contacts in response to our trademark i think the counterparty would housing two different issues whether it's in response to the trademark and whether the content of the a since we're better than one and all that's fine that's that's absolutely the content of the ad is not prohibited by this agreement at all what i'm saying is even if you wanted to run that against a search for one thousand eight hundred contacts arguably under the agreement you could do that and my point is no one came to us and said we'd like to do it because this is just a completely unrealistic scenario and so for example in clorox they have the same option they could have sort of said ok pints all the solution here is not that you can't sell a disinfectant you have to say on the bottle we're not lysol but the court didn't get into that because the parties are in the best position to assess what's commercially reasonable and no party here thought that