Two rival plastics equipment makers have settled a trademark infringement lawsuit involving hidden computer language on a Web site.
Screw and barrel maker Xaloy Inc. (Booth S1424) of Pulaski, Va., announced June 2 that it has settled its suit against competitor Wexco Corp. (Booth E11364) of Lynchburg, Va.
In the lawsuit, filed last August in U.S. District Court in Lynchburg, Xaloy accused Wexco of using the word "Xaloy" — a registered trademark — as a metatag on Wexco's Internet site. A metatag is a key word that appears, usually unseen to outsiders, in a Web site's internal coding. Online search engines scan metatags and other information when seeking matches entered by Web users. As a result, Web surfers who typed "Xaloy" as a search-engine keyword were likely to find Wexco as one of the hits.
Wexco agreed to pay $20,000 to Xaloy. Wexco also agreed to a permanent injunction against the use of Xaloy trademarks in key words, metatags, tags or other HTML computer coding on Wexco's Internet site.
As e-commerce and Internet usage has increased, the case is believed to be the first involving hidden keywords in the plastics industry.
"We are gratified at this result," H. Gunther Hoyt, vice president of Xaloy, said in a news release. "The settlement confirms our resolve to defend our valuable intellectual property rights."
Wexco pulled the offending metatag after the lawsuit was filed last year.
Wexco had contended that the wording had been placed on its Web site by a person who created the site, and that company management was unaware this had been done.
Xaloy officials countered by charging that a Web designer would not know an industry term like Xaloy unless directed by management.
Wexco also pulled the term "Bernex," which is used by the Swiss firm, Bernex-Bimetall Ltd., Xaloy's sister company.
Kevin Holt, a lawyer representing Wexco, said the court did not find any evidence that Xaloy was damaged from sales lost to Wexco via the metatags.
"We settled this on a cost-of-defense, or nuisance, value," Holt said of the $20,000 payment.
