Edible Ip, LLC v. Google, LLC.

313 Ga. 305

869 S.E.2d 481

EDIBLE IP, LLC

v.GOOGLE, LLC.

S21G0798

Supreme Court of Georgia.

Decided: February 15, 2022

Steven Arnold Pickens, Andrew Dorsey Stancil, Mahaffey Pickens Tucker, LLP, 1550 North Brown Road, Suite 125, Lawrenceville, Georgia 30043, Jason James Carter, Ronan Patrick Doherty, Patrick Christopher Fagan, Solesse Lane Altman, Bondurant, Mixson & Elmore, LLP, 3900 One Atlantic Center, 1201 West Peachtree Street, N.W., Atlanta, Georgia 30309-3417, for Appellant.

John David Hadden, The Hadden Law Firm, LLC, 44 Broad Street, Suite 600, Atlanta, Georgia 30303, Bret S. Moore, Broughton Law, 305 West Wieuca Road NE, Atlanta, Georgia 30342, for Amicus Appellant.

Eric Peter Schroeder, Brian McKinley Underwood, Jr., Bryan Cave Leighton Paisner LLP, 1201 W. Peachtree Street, N. W., One Atlantic Center, Fourteenth Floor, Atlanta, Georgia 30309, Margret Mary Caruso, Quinn Emanuel Urquhart & Sullivan LLP, 555 Twin Dolphin Drive, 5th Floor, Redwood Shores, California 94065, for Appellee.

Todd Wuescher Beauchamp, Carolyn Homer, Sarang Damle, Latham & Watkins LLP, 555 Eleventh Street NW, Suite 1000, Washington, DC 20004, Rachel S. Horn, Latham & Watkins LLP, 140 Scott Drive, Menlo Park, California 94025, for Amicus Appellee.

McMillian, Justice.

This case involves Google LLC's application of Internet search algorithms, which it uses to auction off search terms for profit to advertisers, and the interests of Edible IP, LLC, which seeks to exercise control over the profit generated from its trade name and associated goodwill. In 2018, Edible IP brought an action against Google arising from Google's monetization of the name "Edible Arrangements" without permission in its keyword advertising program. Google moved to dismiss the complaint, or in the alternative, to compel arbitration. The trial court granted the motion, dismissing the complaint on several grounds, including that it failed to state a claim, and alternatively compelling the parties to arbitration. Edible IP appealed from that order, and the Court of Appeals affirmed the dismissal for failure to state a claim. See Edible IP, LLC v. Google, LLC , 358 Ga. App. 218, 854 S.E.2d 565 (2021). We granted certiorari to address whether the trial court properly granted Google's motion to dismiss.¹ For the reasons that follow, we conclude that Edible IP has not stated a cognizable claim for relief and therefore affirm.

The Court of Appeals summarized the relevant facts underlying this appeal as follows:

[T]he complaint alleges that Edible IP owns the trademarks, trade names, and other intellectual property associated with Edible Arrangements, a business consisting of websites and "brick-and-mortar" franchises that sell, among other things, floral-shaped arrangements of fresh-cut fruit. To support these websites and franchises, Edible IP licenses the use of its intellectual property to various entities. Edible IP, however, maintains ownership of the intellectual property, which includes the trademark/trade name "Edible Arrangements," as well as the goodwill generated by the brand.

Google operates an Internet search engine that allows individuals to search for information by typing relevant words into a search bar. Using algorithms that analyze the search terms and requested information, Google returns "organic" results of the query on a results page. According to the complaint, Google monetizes its search engine by "sell[ing] ... ‘keywords’ " to advertisers that "trigger advertisements on the search results page when Google users search for the keyword term."

Keyword advertising is purchased through an auction-like process, with prospective advertisers bidding on terms suggested by Google. The auction includes general terms like "shoes" and "mother's day gift," as well as trade names such as "Edible Arrangements." Google has never contracted with Edible IP for the right to use the Edible Arrangements trade name, and Edible IP has not otherwise given Google permission to include its trade name in the keyword advertising program. Nevertheless, Google began auctioning the trade name to advertisers in approximately 2011. As described by the complaint, Google places advertisements purchased through the keyword program "in a more attractive location on the results page than its ‘organic’ results in an effort to drive consumer behavior and get those consumers to click on the ad rather than Google's ‘organic’ results."

Based on these and other allegations, Edible IP sued Google for theft of personal property, conversion, money had and received, and civil [Racketeer Influenced and Corrupt Organizations ("RICO")] violations. Google moved to dismiss the complaint, arguing that any claims alleged by Edible IP needed to be arbitrated, that a forum selection clause deprived the trial court of personal jurisdiction over Google, and that the complaint failed to state a claim upon which relief could be granted. Google also requested that the trial court compel the parties to arbitration.

The trial court granted the arbitration request, determining that Edible IP was subject to an arbitration provision agreed to by one of Edible IP's affiliates, which had accepted the terms and conditions of Google's advertising program. The trial court also found that a forum selection clause within those terms and conditions required that the litigation be filed in California. Alternatively, the court concluded that the complaint failed to state a claim.

Edible IP, 358 Ga. App. at 219-20, 854 S.E.2d 565.

On appeal, the Court of Appeals assumed, without deciding, that the trial court correctly determined that Edible IP was bound by the arbitration and forum selection clauses in Google's contracts with companies affiliated with Edible IP and held that Edible IP's complaint failed to state a claim upon which relief may be granted. See Edible IP , 358 Ga. App. at 220, 854 S.E.2d 565. We granted Edible IP's petition for certiorari to review that holding.

1. A trial court is not authorized to grant a motion to dismiss for failure to state a claim upon which relief may be granted unless:

(1) the allegations of the complaint disclose with certainty that the claimant would not be entitled to relief under any state of provable facts asserted in support thereof; and (2) the movant establishes that the claimant could not possibly introduce evidence within the framework of the complaint sufficient to warrant a grant of the relief sought.

Global Payments, Inc. v. InComm Financial Svcs., Inc. , 308 Ga. 842, 842-43, 843 S.E.2d 821 (2020) (citation and punctuation omitted). And in deciding such motions, "all pleadings are to be construed most favorably to the party who filed them, and all doubts regarding such pleadings must be resolved in the filing party's favor." Id. at 843, 843 S.E.2d 821 (citation and punctuation omitted). This Court reviews the grant of a motion to dismiss de novo. See Norman v. Xytex Corp. , 310 Ga. 127, 130 (2), 848 S.E.2d 835 (2020).

Edible IP insists that this case does not involve trademark infringement claims,² asserting instead that it is challenging Google's direct sale of its proprietary name and goodwill to competitors via Google's keyword advertising program and that the trial court ignored longstanding property law that guarantees a remedy for violations of property rights. Based on this theory, Edible IP has alleged four claims: (1) civil theft of personal property; (2) conversion; (3) money had and received; and (4) violations of Georgia's RICO Act. We will address each of the claims in turn.

(a) Civil Theft of Personal Property.

Georgia law authorizes the owner of property to bring a civil action to recover damages from any person who either (1) willfully damages the owner's personal property or (2) commits a theft as defined in OCGA § 16-8-2.

See OCGA § 51-10-6 (a). OCGA § 16-8-2, in turn, provides that

[a] person commits the offense of theft by taking when he unlawfully takes or, being in lawful possession thereof, unlawfully appropriates any property of another with the intention of depriving him of the property, regardless of the manner in which the property is taken or appropriated.

In its complaint, Edible IP relied on the second method, alleging that "Google has committed theft by taking, in violation of OCGA § 16-8-2" by "unlawfully tak[ing] and otherwise appropriat[ing] Edible IP's property by selling that property without permission to others and keeping the proceeds for itself." Edible IP identified the property as its "trade name ‘Edible Arrangements’ and the good will and reputation associated with that name."

Noting the statutory definition of "deprive,"³ the trial court concluded that because Edible IP has been able to make use of its trade name over the past decade, Edible IP was unable to plead facts establishing that Google "withheld" or "disposed" of its trade name. The Court of Appeals ultimately agreed, explaining that, rather than taking Edible IP's trade name or selling it for profit, Google's conduct involves the sale and placement of advertisements, which does not constitute a taking or appropriation of Edible IP's property. See Edible IP, 358 Ga. App. at 221 (1), 854 S.E.2d 565.

Edible IP now argues that, in affirming the trial court's grant of Google's motion to dismiss, the Court of Appeals looked beyond the plain language of Georgia's theft statute to improperly limit its scope. On the other hand, Google asserts that OCGA § 51-10-6 was introduced in the legislature as the "Civil Shoplifting Act" to give merchants a civil remedy against shoplifters and does not cover the use of trademarks.⁴ We are, thus, first required to determine whether Edible IP's trade name and associated goodwill are "property" within the meaning of the civil theft statute and, if so, the contours of the associated property rights and whether Edible IP has sufficiently alleged that Google has wrongfully "appropriated" this property.

(i) Turning to the first question, we begin by...