Source: The Fashion Law
A federal court in California handed OpenAI a partial victory in its lawsuit against Open Artificial Intelligence, Inc., a company with a similar name but no affiliation. The case, which centers on trademark infringement and false advertising claims, highlights the legal complexities of ownership and usage of the "OpenAI" mark.

Judge Yvonne Gonzalez Rogers of the U.S. District Court for the Northern District of California ruled in favor of OpenAI, finding that Open Artificial Intelligence failed to substantiate its claims of trademark infringement and false advertising. Specifically, the court dismissed Open Artificial Intelligence’s counterclaims, including the assertion that OpenAI’s use of the name was "impermissibly misdescriptive" due to its closed-source software.

The court also rejected claims of consumer confusion, noting that Open Artificial Intelligence did not provide sufficient evidence. However, the judge allowed Open Artificial Intelligence to replead its claims if it could present non-conclusory evidence of actual confusion.

OpenAI had previously secured a preliminary injunction in February 2024, preventing Open Artificial Intelligence from using the trademark. The court found that OpenAI was the likely senior user of the mark, and that Open Artificial Intelligence had only recently entered the market.

Despite the partial victory, several issues remain unresolved, including whether OpenAI’s trademark applications will be accepted by the U.S. Patent and Trademark Office. The case could set a significant precedent for trademark disputes in the tech sector, especially regarding AI-related branding and market confusion.