David and Goliath Square Off in the Online Ordering Arena
A David and Goliath battle is brewing in the Northern District of California, where a chain of restaurants is taking Google to task for what they claim are costly, unauthorized, and deceptive practices in the online ordering arena.[1]
On March 8th, Left Field Holdings filed a complaint against the internet giant, alleging trademark infringement and violations of the Lanham Act.[2] The company, which operates six Lime Fresh Mexican Grill restaurants in the Miami area, says Google is violating the restaurants’ intellectual property rights, misleading customers, and effectively stealing their profits, by re-directing customers to an unauthorized, Google-operated storefront or landing page when the customers intend to order directly from the restaurant.[3] Left Field Holdings seeks to create a class action on behalf of similarly situated restaurants.[4]
The Lanham Act provides a civil right of action for any party damaged when a “person… uses in commerce any word, term, name, symbol, or any combination thereof… which is likely to cause confusion… or deceive as to the affiliation, connection, or association… sponsorship, or approval of his…goods or services.”[5]
Left Field Holdings says Google is profiting off the “goodwill, reputations and tradenames of thousands of restaurants throughout the United States.” [6] creating the false impression the Google-created sites are authorized by the restaurant and sowing consumer confusion in the process.
The plaintiffs allege Google capitalized not just on their tradenames and reputations but took advantage of its dominant market share in the internet search industry[7] when it re-directed prospective buyers to webpages that give a cut of the profits from each purchase to Google and delivery companies like Postmates or GrubHub, instead of the restaurant which is serving up the meal.[8]
The complaint states Google changed the way it does business in 2019 to enable this practice, featuring a prominent “Order Online” button under the restaurants’ recognizable logos, giving the impression the order is being placed with the restaurant, rather than being intercepted by Google and sent to a delivery service that takes as much as 30% of the profits.[9] Google’s “Order Online” button, the complaint alleges, was invented and designed by Google without approval from the restaurants and designed to be “larger, brighter, and more visible than other buttons or links.”[10] And Google does not disclose that this feature is not affiliated with or approved by the restaurants.[11]
“Google began intentionally misdirecting the consumer away from the restaurant’s own website, physical address, and phone number, and into one of two different websites owned and controlled by Google. These websites are deceptively branded as being offered, sponsored, or approved by Plaintiffs and class members, when, they are not.”[12] According to the complaint, Google “knows that its website is more likely to generate orders when cloaked in the imprimatur of the restaurant.”[13]
The complaint says this practice allowed Google to intercept one thousand orders from the six effected businesses from January to August 2020.[14] Plaintiffs claim “hijacked” customers could number in the millions when all restaurants in the prospective class are considered.[15]
Left Field Holdings seeks injunctive relief, forbidding Google from using their trade names in connection with their “Order Online” button, and asks for enhanced damages on the grounds that Google’s conduct was deliberate and willful.[16]
Plaintiff’s lawyer Jason A. Zweig called Google’s practices a threat to a struggling industry already gutted by COVID-19. Zweig says online orders have been a lifeline for restaurants during a perilous time, helping them to reach customers, continue to employ their staff and earn a small profit. “It is appalling that Google would take advantage of an industry going through such a challenging time and, through these deceptive and illegal practices, take a portion of their hard-earned profits for itself.”[17]
A Google spokesperson says the lawsuit mischaracterizes the company’s product.[18]
Four days after the complaint was filed the offending “Order Online” button was still featured when a user Googled Lime Fresh Mexican Grill. Three weeks later, as this story goes to press, the button no longer appears when the restaurant is searched by name.
Footnotes
