Friday, August 27, 2010

Facebook and the Controlled Opposition

Facebook is suing Teachbook in federal court, alleging trademark infringement. They claim that use of the word "book" in the name of a social networking site dilutes the value of their famous brand. A great number of reports have appeared about it, see this, and this, for instance.

I suspect Facebook secretly owns Teachbook. This unfolding drama makes much more sense to me in that light. Let's think about it.

You may or may not know, most teachers are reluctant to use Facebook, citing privacy concerns, fearing their students will friend them. Owning a spin-off site for teachers, with privacy, would be a nice solution. What's a cost-effective way to get the word out, and jump start subscriptions? A nice controversial lawsuit. Membership on Teachbook has gone from a mere 10 users, to nearly 5000, just in the last few days as news of the lawsuit spread.

If Facebook can prevail in the lawsuit, it will establish precedent that it enjoys a trademark in the suffix "book". The best chance for a plaintiff to win in such an endeavor is to control the defendant. And, as Vladimir Lenin so infamously said:

The best way to control the opposition is to lead it ourselves.

We should pay careful attention to how Teachbook handles their defense. There are any number of ways that they could underlitigate, and try to lose on purpose. The first would be answering the complaint right away. Their first two moves should be:

1. Under California law, file an anti-SLAPP Special Motion to Strike. This is a low-cost Motion that would force Facebook to essentially prove up its whole case right at the beginning, just to proceed to discovery. This is a federal case, the judge may or may not allow the California statute 425.16 to be used.

2. File a 12(b)(6) Motion to Dismiss for Failure to State Cause of Action Upon Which Relief Can Be Granted. This is standard defense in almost every federal case. The judge would have the authority to toss the case right out, again, prior to any discovery.

If Teachbook doesn't respond with those two moves, I will immediately smell a rat. However, even if Teachbook litigates vigorously, and even if they get the case dismissed, or even if they counterclaim against Facebook and prevail, it still makes sense that Facebook is behind it. After all, what harm is there in losing a court case to yourself?

I think Facebook is playing both sides in this game, and they have created a no-lose situation for themselves. The worst case is that Teachbook becomes popular among teachers, and Facebook has solved their teacher problem. The best case is all that, PLUS they really do get to own the word "book", and then force every other "book" site to surrender their name.

It's brilliant, and it's the only scenario that makes sense to me. Why else would Facebook risk suing a little tiny website with nothing to lose, and everything to gain from a potential counter-suit?