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Sarah E. White

Cascade Sues Knit Picks over Online Ads

By January 9, 2010

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Thanks to the fabulous Kim Werker I heard earlier this week about a lawsuit filed by Cascade Yarns, Inc., against Crafts Americana Group, Inc., the parent company of Knit Picks, for trademark infringement, false designation of origin, unfair competition and dilution of trademark (you can see the filing here).

The lawsuit alleges that Knit Picks "purchased or requested" online advertising that appeared when people entered search terms that are copyrights of Cascade's into search engines. That's a convoluted way of saying that, for example, if someone typed "Cascade 220" into a search engine, they might see an ad for Knit Picks among the results, which could lead some people to believe that Knit Picks sells their yarn (which it doesn't) or lead them to click on that link and instead buy Knit Picks yarn when they initially wanted Cascade.

Cascade says that it is entitled to recover profits and costs based on the alleged infringement, as well as "enhanced damages" up to three times the amount of actual damages. The company also asks for an injunction against Knit Picks for any future use of its trademark.

All of that would be up to a jury if the case gets that far. A case back in 2006 (PDF) in which Cascade sued Knit Picks for naming a yarn "Sierra" was voluntarily dismissed, apparently when Knit Picks changed the name of the yarn in question.

This sort of case is interesting not just for the yarny world, but for the wider implications of whether a search engine can or should limit the use of keyword ads by competitors when those keywords are trademarked. There have actually been several other cases of this sort through the years, and last year one company sued Google over the practice of allowing competitors to buy ads keyed to trademarked phrases.

At the time Google said "our trademark policy not to monitor the use of trademarks in the U.S., Canada, the UK, and Ireland aims to provide users with choices relevant to their keywords. At the same time, we investigate trademark violations in ad text both as a courtesy to the trademark owner and to ensure that ads are clear to users." But trademark phrases have much more protection in the European Union, so it's possible in time such protection will come to businesses in the United States as well.

I bring this up not to start a debate on the relative merits of the companies in question, but to note that such questionable ads abound on the Internet, and to ask if you feel like a company is being misleading by having their ads show up when a person searches for a competitor's products? Have you ever been confused by clicking on a link you thought was for the product you were searching for only to end up someplace else?


January 9, 2010 at 3:15 pm
(1) sabrina says:

Think this is crazy. If I’m looking for Cascade it wouldn’t matter what other company’s ad came up. If I’m looking for knit picks then thats what I’ll buy. Business and competition go hand in hand. I personally enjoy them both.

January 9, 2010 at 3:55 pm
(2) Kat says:

This is a really interesting conflict. Thanks for bringing it to light! I think Sabrina is right, though when I am shopping for a specific yarn I won’t stop and buy Knit Picks instead.

January 9, 2010 at 6:44 pm
(3) Cyndy says:

Thanks for the info, Sarah. My thought is that both of these are excellent companies, and all companies compete. I think anyone who buys yarn on a regular basis knows what they’re looking for, and won’t be swayed to buy something else unless they feel it’s a better (quality, price, color, etc.) product!

January 9, 2010 at 7:33 pm
(4) Beth says:

I personally find it very annoying to search for a brand name, then find that the sites that appear in the search results don’t actually carry that brand. If I had not wanted that specific brand, I would have entered generic search terms like “wool worsted yarn.”

January 11, 2010 at 12:35 pm
(5) Kate G. says:

Interesting case. I’d love be a fly-on-the-wall when the arguments are read. The jury is still out on the purchasing of trademarked search terms. It’s a whole new area of law.

I agree with Sabrina and the group. I’d add that yarn consumers are smarter than Cascade seems to give them credit for.

January 11, 2010 at 2:02 pm
(6) Jessica-Jean says:

I don’t think Cascades is really upset; they are just looking for (and getting) free advertising. As long as the consumers are hearing about and seeing their name – be it in lawsuits or ads – they are happy.

January 11, 2010 at 5:49 pm
(7) Snowite says:

I have never been influenced by seeing other advertisements under Google. In fact – if it were not such a vast spectrum of available information – I might never have been exposed to the brands that are complaining!!! It is a double edged sword! I might be looking for something under Red Heart when Lion Brand comes up – or looking for Bernat when another brand comes up – it doesn’t mean that I’m going to go to the alternate brand – it just shows that there are more choices. What if the company that is complaining benefitted from someone’s search – equal opportunities!!!

January 11, 2010 at 10:02 pm
(8) Joan says:

“Have you ever been confused by clicking on a link you thought was for the product you were searching for only to end up someplace else?” Heavens to betsy, yes! But the whole idea is to keep in mind what you were actually looking for. If you want “Cascade” then look for Cascade, not Knit Picks. Law suit sounds rather frivilous to me IMHO.

January 11, 2010 at 10:14 pm
(9) Lise says:

I agree with Joan on the frivolous lawsuit point. I too believe that yarn consumers are going to buy what it is they wish to purchase.

January 12, 2010 at 11:30 am
(10) QueerJoe says:

For me this would be likened to a print advertiser saying that their yarn was just like Cascade 220, or worse yet, that they carry Cascade 220. I would be thrilled about this kind of trademark infringement if I was Cascade or a local yarn store that sold Cascade.

If a company like WEBS (who I think carries Cascade yarns) was to do the same thing, I wouldn’t find anything wrong with that, but KnitPicks is trying to fool folks that don’t know they don’t carry that yarn.

January 12, 2010 at 4:44 pm
(11) mary says:

personally, I think that the cascade folks are just trying to see what they can get..Why would someone like Kelley and her husband mislead try to mislead people intentionally? Beats me..if I wanted Bernat, I’d go where I knew they had Bernat, or Lily whatever I was looking for..KP has their own high quailty yarns..they don’t need to intentionally mislead folks..

January 12, 2010 at 6:07 pm
(12) Heather says:

Last time I checked, KnitPicks was based out of Portland, Oregon. PDX is on the outskirts of the Cascade Mountain Range. So theoretically the Cascade being part of a search for them could be off of their location. (Though I could be wrong about Portland, they may be across the river in Vancouver, WA also).

October 29, 2010 at 1:15 am
(13) Evelyn says:

The more I read about them, hear about them, and learn about them the more I believe that Cascade is a litigious company that uses law to its own purposes as best as it can.

I am pretty sure they sued Berroco, they have been trying stir the pot for another company called KFI and I have heard that they have gone after Crystal Palace.

They also threaten small yarn shops with law suits and bully them so as to scare them into not carrying the products of their competitors. I am not an attorney but I am thinking that this is unfair competition.

Why do they spend this much effort in suing people? Makes one wonder.

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