Priceline Threatens to Sue Smashwords

Alright, this is god awful silly. I don't know whether to laugh or get mad. I'm leaning toward mad, judging from the adrenaline.

It always bugs me when big swinging ding dongs try to throw their weight around using lawyers and the threat of legal action to bully or intimidate.

The ding dong in question is Priceline.com.

A couple hours ago, I received the email below. Priceline is threatening to sue Smashwords if we don't take down our experimental web site, Name-your-own-price-ebooks.com, which is one of a constellation of sites that comprise the Smashwords Satellites experiment we launched a few weeks ago.

Apparently, I offended the sensibilities of their trademark by using the sacred words in a domain name. While they're at it, maybe they should sue Publisher's Weekly for using the term in a book review to refer to Radiohead's innovative experimental pricing model, or sue Amazon.com for reprinting the review, or sue Chris Anderson for using the Publisher's Weekly review to promote his book, Free.

I've always been a huge fan of William Shatner, but I think Priceline.com just lost a customer.

Some background, for those of you who care:

Yesterday, our office received a call from someone inquiring about the above-mentioned domain, which I registered in my name and the name of the PR firm I own, Dovetail Public Relations.

The message I received was cryptic, usually the sign of someone trying to sell me something I don't need. If you ever want to make me not what to return your call, inquire about a domain name that's hardly worth the $8.00 I paid for it. Did she want to purchase the domain? It's not for sale. I only responded because I thought there was a chance she might be a Smashwords customer, possibly having trouble with an ebook.

Personally, I think it's a poor domain name, judging from the fact that as of yesterday, according to Google Analytics (click on the screen shot at below), the site has attracted a grand total of (drum roll please) nine unique visitors for a total of ten visits in about 16 days. No, those aren't typos. I'm not rounding to the nearest million or thousand.

The average time spent on name-your-own-price-ebooks.com, according to Google Analytics, was zero minutes and zero seconds, making me wonder if only robots and web crawlers have visited this particular Satellite. It also makes me wonder if the lawyer bothered to visit the site before billing Priceline.com a few sweet hours to write the toothy letter below.

If she had visited the site, or studied Smashwords, she'd know we don't auction off ebooks. At Smashwords, we give our ebook authors and publishers multiple options by which to price their books, and name your own price is one of them (though we call it "You set the price!" Can we get sued for that too?). Radiohead inspired us to introduce the pricing option 15 months ago, not Priceline.com or my man William Shatner (hey, did you hear him reading Sarah Palin's tweets as poetry on Conan the other night? Hilarious.) .

It's curious Priceline would care about our little Smashwords Satellite experiment. Back in 2005 or 2006, Priceline.com began de-emphasizing their opaque "Name your Own Price" option in favor of more transparent price comparisons, according to these articles in USA Today and the San Francisco Chronicle. The company received quite a bit of criticism for its Name Your Own Price Option, because some customers could overpay if they accidentally bid too high, according to travel author and journalist Edward Hasbrouck of The Practical Nomad who blogged about the practice in 2003 and wrote:

From its start, Priceline.com has required you to "name your own price". Priceline.com determines a minimum offer that they will accept, based on how much their consolidator contracts require them to pay the cheapest airline for your tickets. But Priceline.com doesn't tell you that price. You have to guess, and if you offer more than necessary, Priceline.com keeps the difference as a windfall of pure profit. This is, quite clearly, the system of price "negotiation" most disadvantageous to the consumer.

Clearly, it's not at all similar to what we're doing at Smashwords. Some of our authors want their customers to set the price of their book. Often, it's whatever the customer wants to pay, or is capable of paying. A price of zero is acceptable and quite common. I'd apply for a trademark on "Free Stuff" but that would be silly.

The letter below accuses me of some nasty things, and these accusations just make me all the madder. Some sample gems:

1. I'm engaging in "calculated infringement of Priceline's NAME YOUR OWN PRICE Mark." (No.)
   
2. I'm "trading on the goodwill of their famous service mark" (oh really?)
3. I "plainly intend to mislead Web users into believing that [Smashwords] is approved of, sponsored by or affiliated with Priceline." (uh, yeah, are you trying to make me laugh? Can I sue you for such a lie?)
4. My "actions also put Priceline at risk of irreparable injury through tarnishment of its reputation." (Uhm, write me more letters. Maybe if Priceline.com treated their customers with the respect Smashwords treats its customers, you'd have a better reputation than, say, "the bottom of the heap" according to the latest results from the Foresee Survey of ecommerce customer satisfaction, as reported earlier this year by Web Pro News.)

The silliest thing about all this is that this particular Smashwords Satellite, name-your-own-price-ebooks.com, was already a candidate for my chopping block. I shared the stats above. Now I'm not so eager to pull the plug.

When we launched the Satellites, we made clear they were an experiment. Whether some or all of them become permanent standalone sites, or if we kill some, or merge some into the Smashwords.com mother ship (maybe I should refer to it as the Smashwords Starship Enterprise?), remains to be seen. So far, customers have been uniformly positive on the experiment. Customers appreciate the ability to browse and discover ebooks sliced and diced into so many specialty categories, and they like how the user interface allows them to control the information presented.

Oh, as an aside, here's an irony only ebook people and techies will understand: Her firm's web address is www.drm.com.

The letter asks me to respond in writing. So here's my response: Maybe.

(rec'd at 2:12pm Pacific time, August 1 2009.  I replaced her name and contact information with XXX.  It's not her fault, so don't blame her.  She's just doing the evil bidding of Priceline.com.  ~mc.)

Dear Mark,

We represent Priceline.com Incorporated ("Priceline"), the owner of numerous U.S. service mark registrations for its famous marks, including NAME YOUR OWN PRICE(r) (the "Mark").  This Mark has accrued enormous and invaluable goodwill with the public since 1998. Priceline has invested substantial sums in the last decade in popular national advertising campaigns featuring NAME YOUR OWN PRICE, which as a result is now a famous mark, as that term is defined in the Trademark Act.

Our attention has recently been directed to your registration, on behalf of Dovetail Public Relations, of the domain name name-your-own-price-ebooks.com, which links to an active commercial site where users can bid on e-books.  The service mark NAME YOUR OWN PRICE EBOOKS is displayed prominently at the top of each Web page.  The registration and use of name-your-own-price-ebooks.com and the use of the mark NAME YOUR OWN PRICE EBOOKS for a Web site that allows users to bid on e-books by using Priceline's NAME YOUR OWN PRICE Mark and proprietary auction model violates Priceline's valuable intellectual property rights by trading on the goodwill of that famous Mark.  This is illegal under federal and state law.

Web users seeking the services of Priceline are being deliberately and deceptively lured to the name-your-own-price-ebooks.com Web site through your calculated infringement of Priceline's NAME YOUR OWN PRICE Mark.  By using name-your-own-price-ebooks.com and NAME YOUR OWN PRICE EBOOKS, you plainly intend to mislead Web users into believing that your business is approved of, sponsored by or affiliated with Priceline.

That e-books are being auctioned rather than travel services provides no defense.  The NAME YOUR OWN PRICE Mark is so famous and so closely identified with Priceline that the scope of protection from dilution afforded the Mark under federal law extends to any product or service.  You may therefore be held accountable for any sales attributable to consumer traffic improperly diverted to your site as a result of the violation of Priceline's rights.  These actions also put Priceline at risk of irreparable injury through tarnishment of its reputation.

Any further use of name-your-own-price-ebooks.com and NAME YOUR OWN PRICE EBOOKS as a service mark or business name must immediately cease, as must the use of any other infringing trademarks, service marks, domain names, electronic identifiers, URL addresses, metatags, promotional communications and the like, wherever they may appear, that incorporate "NAME YOUR OWN PRICE" or obvious variations of it.

Accordingly, we demand that you reply in writing (e-mail is acceptable) confirming that:

(a) name-your-own-price-ebooks.com will immediately be disabled, remain inactive, not be transferred, and not be renewed when it expires on June 16, 2010;

(b) any and all use of name-your-own-price-ebooks.com and NAME YOUR OWN PRICE EBOOKS will immediately cease; and         

(c) you will not use "Name Your Own Price," "Name Your Own Price Ebooks" nor any other variation of the Mark, in any domain name or service mark, on any Web site, or anywhere at all in the future.

If these steps are taken promptly, we will monitor name-your-own-price-ebooks.com but not pursue the matter further.  We will visit the name-your-own-price-ebooks.com Web site shortly.  If we find it still active we may, without further notice to you, file a complaint under the Uniform Domain Name Dispute Resolution Policy with the World Intellectual Property Organization, or take such other legal action as we deem necessary to terminate your tortious interference with Priceline's business.  We are hopeful you will choose the path of least resistance.

Please contact me if you have any questions.

XXX | Downs Rachlin Martin PLLC
Associate | Intellectual Property Law Group
199 Main Street, PO Box 190 | Burlington, VT 05402-0190
XXX
XXX| www.drm.com

Admitted in Vermont, New Hampshire, and Massachusetts

-----Original Message-----
From: Mark Coker [mailto:XXX
Sent: Saturday, August 01, 2009 5:27 PM
To: XXX
Subject: Re: Smashwords

XXX,

Let's do it over email.  How can I help you?

mark



XXX wrote:

> Hi, Mark,
> 
> Please call me on Monday.
> 
> Thanks,
> XXX
> 
> 
> XXX | Downs Rachlin Martin PLLC
> Associate | Intellectual Property Law Group
> XXX
> XXX| www.drm.com
> 
> 
> Admitted in Vermont, New Hampshire, and Massachusetts
> 
> 
> -----Original Message-----
> From: Mark Coker [mailto:XXX
> Sent: Friday, July 31, 2009 1:08 PM
> To: XXX
> Subject: Smashwords
> 
> Hi XXX,
> 
> You called?  How can I help you?
> 
> Best,
> mark
> 
> 

--
--
Mark Coker
Founder
Smashwords, Inc.  http://www.smashwords.com
http://www.linkedin.com/in/markcoker
http://www.twitter.com/markcoker