Opinion ID: 1291747
Heading Depth: 3
Heading Rank: 5

Heading: The District Court's Finding Regarding eBay's Unclean Hands

Text: Unclean hands is a defense to a Lanham Act infringement suit. Japan Telecom, Inc. v. Japan Telecom America Inc., 287 F.3d 866, 870 (9th Cir.2002) (citation omitted). Trademark law's unclean hands defense springs from the rationale that it is essential that the plaintiff should not in his trade mark, or in his advertisements and business, be himself guilty of any false or misleading representation. Id. (citation and internal quotation marks omitted). To show that a trademark plaintiff's conduct is inequitable, defendant must show that plaintiff used the trademark to deceive consumers. Id. (citation omitted). Bad intent is the essence of the defense of unclean hands. Id. (citations omitted). At the conclusion of the bench trial, Perfumebay was allowed to amend its complaint to include the unclean hands defense. The primary testimony on the issue came from eBay's witness, Briggs. Briggs testified that the advertisements for Perfumebay on eBay's site may have resulted because affiliates would often purchase misspellings of a term. Briggs emphasized that its affiliates were buying those links not eBay. Briggs also demonstrated that affiliates had advertised the Los Angeles freeway, the Hollywood sign, sf bay, and Gold Line for sale on eBay. However, Briggs acknowledged that eBay does permit the use of someone else's brand name in an advertisement on Google when it has no relationship with that brand name[.] The record does not affirmatively demonstrate that eBay used the advertisements to deceive consumers. See id. There also is limited evidence, if any, supporting the district court's finding that it is axiomatic that the principal is responsible for the acts of the agent acting within the scope of their authority, i.e. the affiliates. Although eBay's conduct may be questionable, the evidence does not adequately detail eBay's relationship with or control over the affiliates. Thus, it is not clear from the record that eBay acted with the requisite bad intent for an unclean hands finding. See id. As a result, we conclude that there was an insufficient foundation for the injunction against the advertising conducted by eBay's affiliates. See Jarrow Formulas, Inc. v. Nutrition Now, Inc., 304 F.3d 829, 842 (9th Cir.2002).