Likelihood of confusion Archives - Page 4 of 8

Likelihood of confusion

Texas Hammer Nails Trademark Infringement Appeal

by Joshua Revilla | Sep 2, 2021 | Trademarks

The US Court of Appeals for the Fifth Circuit reversed a district court’s dismissal of an initial confusion trademark complaint, finding that the plaintiff alleged a plausible claim of trademark infringement under the Lanham Act. Adler v. McNeil Consultants, LLC, Case No. 20-10936 (6th Cir. Aug. 10, 2021) (Southwick, J.)

Jim Adler is a personal injury lawyer who trademarked and used several terms, including JIM ADLER, THE HAMMER and TEXAS HAMMER, to market his business, including via keyword advertisements. McNeil Consultants, a personal injury lawyer referral service, purchased keyword ads using Adler’s trademarked terms, which allowed McNeil’s advertisements to appear at the top of any Google search of Adler’s trademarked terms. McNeil’s advertisements used generic personal injury terms, did not identify any particular law firm and clicking on the ads placed a phone call to McNeil’s call center rather than directing the user to a website. The call center used a generic greeting so consumers did not realize with whom they were speaking.

Adler filed suit against McNeil, asserting Texas state law claims as well as trademark infringement under the Lanham Act. McNeil moved to dismiss, arguing that its keyword ads did not create a likelihood of confusion. The district court agreed and dismissed Adler’s complaint. Adler appealed.

To successfully plead a trademark infringement claim under Fifth Circuit law, the holder of a protectable trademark must establish that the alleged infringing use “creates a likelihood of confusion as to source, affiliation, or sponsorship.” To determine whether a likelihood of confusion exists, the Court weighs a non-exhaustive list of several confusion factors, including the similarity of the marks, the similarity of the products, the defendant’s intent and the care exercised by potential consumers.

The Fifth Circuit explained that Adler alleged initial interest confusion, which exists where the confusion creates consumer interest in the infringing party’s services even where no sale is completed because of the confusion. The Court noted that this case presented the first opportunity for the Fifth Circuit to consider initial interest confusion as it pertains to search engine keyword advertising. Relying on Ninth Circuit precedent and parallel reasoning to its own opinions on initial interest confusion in the context of metatag usage, the Court concluded that Adler’s complaint alleged a plausible claim of trademark infringement under the Lanham Act.

The Fifth Circuit noted that initial interest confusion alone is not enough to raise a Lanham Act claim. The Court explained that if a consumer searches TOYOTA and is directed to search results containing a purchased ad clearly labeled as selling VOLKSWAGEN products, a consumer who clicks on the VOLKSWAGEN ad has been distracted, not confused or misled into purchasing the wrong product. Distraction does not violate the Lanham Act. However, the Court explained that where the use of keyword ads creates confusion as to the source of the advertisement—not mere distraction—an infringement may have occurred. Because McNeil’s advertisements were admittedly generic and could have been associated with any personal injury law firm, the Court found that the keyword [...]

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Initial Confusion? Relax, Eighth Circuit Has Your Number

by Paul Devinsky | May 20, 2021 | Trademarks

Addressing a novel issue regarding when confusion must occur for it to be actionable, the US Court of Appeals for the Eighth Circuit concluded that initial-interest confusion was a viable infringement theory. Select Comfort Corp. v. Baxter, Case No. 19-1113 (8th Cir. May 11, 2021) (Melloy, J.)

Select Comfort owns registered trademarks, including “SELECT COMFORT,” “SLEEP NUMBER” and “WHAT’S YOUR SLEEP NUMBER,” for adjustable air mattresses, which it sells online and in stores across the United States. Baxter sells competing air mattresses online and through a call center. Select Comfort brought a suit asserting trademark infringement, trademark dilution and false advertising theories against Baxter. Select Comfort alleged that Baxter used Select Comfort’s registered trademarks in an identical or confusingly similar manner to advertise Baxter’s mattresses and divert consumers to its website and phone lines instead of Select Comfort’s. Select Comfort also alleged that Baxter made false representations about its products and failed to dispel consumer confusion about the products. At trial, Select Comfort pointed to similar terms in Baxter’s online advertising text, graphics and domain addresses, in addition to examples of actual confusion about the products in Baxter’s call-center transcripts.

Earlier in the case, in connection with summary judgment, the district court found that the relevant consumers were sophisticated as a matter of law, and, citing Eight Circuit precedent, rejected application of a theory of initial-interest confusion. The district court instead instructed the jury that in order to prevail on its trademark infringement claim, Select Comfort had to prove likelihood of confusion at the time of purchase. Based on this limiting instruction, the jury rejected Select Comfort’s trademark infringement claims. Select Comfort appealed.

The Eighth Circuit reversed. The Court explained that the district court erred on the availability of an initial-interest confusion as an infringement theory. For trademark infringement claims, the likelihood of confusion test is a fact-intensive inquiry with many factors. However, circuit courts have not definitively agreed on when confusion must exist. Must confusion occur only at the time of ultimate purchase, or can it also exist during pre-sale? The theory of initial-interest confusion involves the latter scenario, namely, when confusion about a product’s ownership causes a customer to have initial interest in the product, even if there is no actual sale at the time of the confusion. Actionable initial infringement protects competitors from getting a free ride on the goodwill of an established mark if a consumer falsely infers an affiliation between the companies.

In the precedential 2010 Eighth Circuit case Sensient Techs. v. Sensory Effects Flavor, the Court neither rejected nor adopted the initial-interest/pre-sale confusion theory. Instead, it merely found that the theory did not apply where consumers were sophisticated (i.e., where they exercise a high degree of care in purchasing products, a factor weighing against likelihood of confusion). Here, influenced by Lanham Act amendments and other circuit courts, the Court addressed the issue previously left open: whether the initial-interest confusion may be actionable in the Eighth Circuit in cases where the jury is left to [...]

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Reverse Confusion Suit Not Ironclad, but SmartSync Lives On

by Joshua Revilla | Apr 29, 2021 | Trademarks

In a split decision, the US Court of Appeals for the Ninth Circuit vacated a district court’s summary judgment and remanded the case for trial in an action brought under the Lanham Act in order to resolve material issues of fact on likelihood of confusion/reverse confusion factors that remain in dispute. Ironhawk Technologies, Inc. v. Dropbox, Inc., Case No. 19-56347 (9th Cir. Apr. 20, 2021) (Smith, J.) (Tashima, J., dissenting)

Ironhawk developed computer software designed to transfer data efficiently in “bandwidth-challenged environments” and has marketed the software since 2004 using the name “SmartSync.” Ironhawk registered the SmartSync mark in 2007. In 2017, Dropbox launched a feature entitled “Smart Sync,” which allowed users to see and access files in their Dropbox cloud storage accounts without taking up space on their hard drive. Ironhawk sued Dropbox for trademark infringement and unfair competition in 2018, alleging that that Smart Sync intentionally infringed upon Ironhawk’s SmartSync trademark and was likely to cause confusion among consumers. The district court granted summary judgment in favor of Dropbox, concluding that “a reasonable trier of fact could not conclude that Dropbox’s use of Smart Sync is likely to cause consumer confusion.”

Ironhawk appealed, focusing primarily on its reverse confusion theory of infringement. Reverse confusion occurs where consumers dealing with the holder of the senior mark (Ironhawk) believe they are dealing with the junior (Dropbox). This occurs when someone who is only aware of the well-known junior (Dropbox) comes into contact with the lesser-known senior (Ironhawk) and incorrectly believes the senior is the same as, or affiliated with, the junior user because of the similarity of the two marks.

The Ninth Circuit first defined the relevant consumer market. This issue revolved around whether the relevant market should be limited to Ironhawk’s only active customer, the US Navy, or whether it should include commercial customers. Dropbox argued that the market should be limited to the Navy and that consequently the relevant consumer would be less likely to be confused as to the source or affiliation of SmartSync. In terms of procurement, it was undisputed that the Navy exercised significant care and effort. However, Ironhawk argued that it previously had a commercial customer, and that it actively markets and pursues business with other commercial businesses. The Court held that because Ironhawk had a previous commercial customer and had made recent attempts to acquire more commercial accounts, a reasonable jury could include the potential commercial customers in the relevant market.

The Ninth Circuit next turned to the “highly factual inquiry” of the eight Sleekcraft factors:

Strength of the mark
Proximity of the goods
Similarity of the marks
Evidence of actual confusion
Marketing channels used
Type of goods and likely level of care exercised by purchaser
Defendant’s intent in selecting the mark
Likelihood of expansion of the product lines.

For the first three factors, the Ninth Circuit found that a reasonable jury could find that:

Dropbox’s mark was commercially strong and would be able to swamp Ironhawk’s reputation.
The Smart [...]

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You Want Some “Metchup” with That?

by Paul Devinsky | Apr 22, 2021 | Trademarks

The US Court of Appeals for the Fifth Circuit found no infringement by a large, well-known company that used the registered mark of an individual whose own use was local and generated only a few sales and minimal profits. The Court vacated and remanded the case to determine whether plaintiff had abandoned the mark. Dennis Perry v. H.J. Heinz Co. Brands, L.L.C., Case No. 20-30418 (5th Cir. Apr. 12, 2021) (Graves, J.)

In 2010, Dennis Perry created a condiment concoction in his home kitchen that he named “Metchup,” constituting a blend of private label mustard and ketchup, and a blend of mayonnaise and ketchup. Perry sold the concoction in the lobby of his small motel in Louisiana. The US Patent & Trademark Office granted registration for his trademark “Metchup” and after five years declared his mark “incontestable.” Perry had slow sales, however, only selling about 60 bottles with $50 total profit over the years. Perry had a Facebook page for his product, but did not advertise or sell the product in stores or online.

Meanwhile, Heinz produced a condiment called “Mayochup,” a blend of mayonnaise and ketchup, that it began selling in the United States in 2018. Heinz held an online naming contest to promote its product, and when one participant suggested the name “Metchup,” Heinz posted a mock-up picture with the “Metchup” name, along with other proposals. Heinz’s counsel saw Perry’s trademark registration, but because Heinz was not actually selling a product named “Metchup” and there were so few indications that Perry’s product was actually being sold, Heinz concluded that Perry’s mark was not in use and could be used in its promotion. When Perry saw Heinz’s posting, he sued for trademark infringement.

The district court found that while Perry may have once had a valid trademark registration for “Metchup,” there was no likelihood of confusion with the Heinz product and the mark had been abandoned as a consequence of de minimis use. Perry appealed.

The Fifth Circuit analyzed the dispute based on the eight-factor likelihood of confusion test. The Court found three factors weighed in Perry’s favor:

Product similarity: Both products were mixed condiments.
Potential purchaser care: Consumers would exercise less care for a low-priced condiment.
Mark similarity: Both products used the same word “Metchup,” although the Court noted that the packaging design looked very different.

The Court also found five factors weighed in Heinz’s favor:

The type of mark on the spectrum (i.e., whether the name is related to what the product is): Here, the mark was “suggestive” because it was a mash-up of names related to the sauces used.
Outlet and purchaser identity: The parties targeted different markets because Perry had limited sales in one motel, while Heinz targeted online and at almost all grocery stores.
Advertising identity: Perry did not advertise besides his one Facebook page without online sales, while Heinz had large-scale advertising and sales.
Defendant’s intent: Heinz did not intend to infringe because it assumed Perry’s mark was no longer [...]

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Fifth Circuit Says No Preliminary Injunction in Boozy Beverage Trademark Fight

by Sarah Bro | Dec 17, 2020 | Trademarks

The maker of BRIZZY-brand hard seltzer claimed that consumers would confuse a product branded VIZZY hard seltzer with its own. The United States Court of Appeals for the Fifth Circuit disagreed, however, and affirmed the district court’s denial of the preliminary injunction with an explanation as to how the plaintiff failed to demonstrate a substantial likelihood of success on the merits with respect to its trademark infringement claim. Future Proof Brands, L.L.C., v. Molson Coors Beverage Company, et. al., Case No. 20-50323 (5th Cir. December 3, 2020) (Smith, J.).

With a booming market for hard seltzers and ready-to-drink cocktails, it is no surprise that disputes over brand names of the bubbly alcoholic beverages have followed. After the district court denied Proof Brands’ request for a preliminary injunction against Molson Coors’ entry into that market, Proof Brands appealed. The Fifth Circuit issued a reminder that a preliminary injunction is “an extraordinary remedy which should not be granted unless the party seeking it has clearly carried [its] burden of persuasion,” and reviewed the district court’s denial of Future Proof’s request for an abuse of discretion. The Court further noted that under Planned Parenthood Ass’n of Hidalgo Cnty. v. Suehs, Future Proof must demonstrate four factors to obtain a preliminary injunction, namely: (1) a substantial likelihood of success on the merits, (2) a substantial threat of irreparable injury if the injunction is not granted, (3) that the substantial injury outweighs the threatened harm to the party sought to be enjoined and (4) that granting the preliminary injunction would not disserve the public interest. Concluding that Future Proof was unable to demonstrate a substantial likelihood of success on the merits of its trademark infringement claim, the court did not address the remaining three preliminary injunction factors.

Future Proof argued that in the course of determining whether there was a likelihood of confusion between the BRIZZY and VIZZY trademarks, the district court erred in analyzing the various factors, or “digits,” of consumer confusion used by the Fifth Circuit. The Court tackled each of the “digits” assessing the likelihood of consumer confusion, noting that even with “some errors,” the district court correctly concluded that Future Proof failed to show a substantial likelihood of success on its trademark infringement claim.

Starting with the type or strength of the trademark allegedly infringed factor, the Fifth Circuit disagreed somewhat with the district court and found the BRIZZY mark to be suggestive, rather than merely descriptive of “fizzy” beverages. Nevertheless, the Court noted that suggestive marks—like descriptive marks— are “comparatively weak” for purposes of a confusion analysis, and cited a number of third-party carbonated beverage brands sharing the common “-IZZY-” root to affirm its agreement with the district court that BRIZZY is a weak trademark. With a “weak” mark at issue, the Court found the similarity factor to weigh only marginally in favor of the injunction, especially given key differences between the product packaging and labels for the respective BRIZZY and VIZZY beverages.

Moving on to the defendant’s intent factor, [...]

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Sticky Situation? Circumstantial Evidence Can Support Intent to Confuse in Trade Dress Claims

by Paul Devinsky | Nov 4, 2020 | Trademarks

The US Court of Appeals for the 11th Circuit reversed a district court’s grant of summary judgment for the defendant on trade dress infringement and trade dress dilution claims, finding that evidence relating to the likelihood of confusion was not viewed in the light most favorable to the plaintiff. However, the Court affirmed the grant of summary judgment for the defendant on the plaintiff’s false advertising claims because the allegedly deceptive advertising was not material to consumer purchasing decisions. J-B Weld Co., LLC v. Gorilla Glue Co., Case No. 18-14975 (11th Cir. Oct. 20, 2020) (Tjoflat, J.) (Carnes, J., concurring).

J-B Weld and Gorilla Glue are competitors specializing in heavy-duty adhesive products. Gorilla Glue introduced an adhesive under the brand name GorillaWeld that mimicked the packaging of a J-B Weld product. Gorilla Glue advertised GorillaWeld as a steel bond epoxy based on the strength of the bond and its similarity to an epoxy-group polymer, even though the product was not a chemical epoxy and did not contain any steel. J-B Weld sued, alleging trade dress infringement based on the Lanham Act and Georgia law, trade dress dilution based on Georgia law, and false advertising under the Lanham Act. The district court granted Gorilla Glue summary judgment on all claims, finding no trade dress infringement or dilution based on insufficient evidence of likelihood of confusion, and no false advertising because the evidence did not demonstrate that Gorilla Glue’s steel bond epoxy claim was material to consumer purchasing decisions. J-B Weld appealed, arguing that the district court did not properly view the evidence in the light most favorable to J-B Weld.

The 11th Circuit reversed on the trade dress infringement and dilution claims and affirmed on the false advertising claim. On the trade dress infringement claims, the 11th Circuit found that the district court did not view the evidence in the light most favorable to J-B Weld in analyzing the likelihood of confusion between the respective trade dress of J-B Weld and GorillaWeld, as required in the context of summary judgment. The 11th Circuit found that the district court did not properly credit evidence relevant to the similarity of the designs, Gorilla Glue’s intent and instances of actual confusion. For example, despite multiple similarities between the J-B Weld and GorillaWeld packages (including a V-shape tube arrangement and the use, emphasis and location of certain text), the district court found that the presence of the Gorilla Glue logo, brand name and color scheme negated a finding of similarity. The 11th Circuit deemed this finding error in the context of summary judgment. The Court also determined that communications from Gorilla Glue’s packaging design team that repeatedly referenced J-B Weld’s packaging and expressed a desire to use similar elements (including a communication in which a Gorilla Glue employee referred to the GorillaWeld design as a “knock off”) were improperly ascribed to innocuous motives based on self-serving testimony from a Gorilla Glue employee. As the Court explained, summary judgment required drawing all inferences in the light [...]

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Eye Don’t: No Counterfeiting Without Likelihood of Confusion

by Sarah Bro | Oct 15, 2020 | Trademarks

Referring to the act of counterfeiting as “hard core” or “first degree” trademark infringement, the US Court of Appeals for the Ninth Circuit for the first time confirmed that the Lanham Act requires a likelihood of confusion in order for the trademark holder to prevail on a counterfeiting claim. Arcona, Inc. v. Farmacy Beauty, LLC, et al., Case No. 19-55586 (9th Cir. Oct. 1, 2020) (Lee, J.) In doing so, the Court affirmed a grant of summary judgment in favor of defendant Farmacy Beauty in a counterfeiting action brought by skin care brand Arcona.

Arcona’s counterfeiting claims (which remained in the district court action after Arcona requested dismissal of its trademark infringement and unfair competition claims) stemmed from Farmacy Beauty’s use of the term EYE DEW on its skincare products, which Arcona asserted to be counterfeit versions of its eye cream sold in the United States under the registered EYE DEW trademark. The district court, however, found that dissimilar packaging and branding made it “implausible” that consumers would be tricked into believing that Farmacy’s EYE DEW product was actually one of Arcona’s skin care products, and granted partial summary judgment for Farmacy on the counterfeiting claim. Arcona appealed.

Arcona argued that it was not required to show a likelihood of consumer confusion with respect to the parties’ EYE DEW eye creams in order to pursue its trademark counterfeiting claim. The Ninth Circuit starkly disagreed, finding that the plain language of the Lanham Act, 15 USC § 1114, expressly states that likelihood of confusion is a requirement for a counterfeiting claim.

The Ninth Circuit also rejected Arcona’s alternative argument, that there should be a presumption of likelihood of confusion based on the parties’ use of the identical mark EYE DEW. The Court explained that in a claim of counterfeiting—even with identical trademarks—there is no presumption of consumer confusion if the products themselves are not identical. Here, evidence demonstrated that the parties sold their respective EYE DEW products in very different packages, with Arcona’s eye cream being in a “tall, cylindrical, silver bottle encased in a slim, cardboard outer box,” and Farmacy’s eye cream sold in a “short, wide, white jar, along with a squarish outer box.” In reviewing the parties’ respective products as a whole, including prominent displays of the respective house marks FARMACY and ARCONA, as well as differences in packaging, size, color, shape and “all other attributes,” the Court determined that the parties’ products were not identical and that there was no presumption of consumer confusion.

The Ninth Circuit concluded that summary judgment of no counterfeiting was proper because there was no genuine dispute of material fact about the likelihood of consumer confusion factor. The Court acknowledged that the parties’ eye cream products do compete in the same space and in the same geographic markets, but explained that a claim of counterfeiting nevertheless requires that the parties’ marks be “considered in their entirety and as they appear in the marketplace.” Noting that the available evidence demonstrated significant differences between [...]

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Stratus Update: Federal Circuit Affirms TTAB Refusal to Register Telecoms Mark

by McDermott Will & Emery | Apr 30, 2020 | Trademarks

The US Court of Appeals for the Federal Circuit affirmed a US Patent & Trademark Office (PTO) Trademark Trial and Appeal Board (TTAB) refusal to register the mark STRATUS over the existing registration for STRATA, finding a likelihood of confusion between the two marks. Stratus Networks, Inc. v. UBTA-UBET Communications, Inc., Case No. 19-1351 (Fed. Cir. Apr. 14, 2020) (Reyna, J.).

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