Judge finds Canvas in contempt of court, fines it $2,500 per day

Fine might go up after February 25.

U.S. District Judge Dale Kimball has found diversity recruiting site Canvas in contempt of court for failing to stop using the Canvas name and canvas.com domain name.

Instructure (NYSE: INST) sued Canvas in November, arguing that the latter company’s rebrand to Canvas infringes its trademarks. Judge Kimball granted a preliminary injunction and ordered Canvas to stop using the name by January 20. Canvas continues to use the brand despite the deadline passing.

Today, judge Kimball ordered Canvas to pay $2,500 per day going forward until it rebrands, and that fine might increase after February 25. He also ordered the company to pay Instructure’s legal fees related to its order to show cause on the contempt of court findings, which might end up being more.

For Canvas, this is a relatively small price to pay to buy more time to rebrand. Changing domain names is hard, and a quick name change would probably cost the company more damage than the fines and legal fees.

Expect Canvas to announce a new name fairly soon after a very thorough trademark check.

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