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Review Delayed Is Not Review Denied

by Christopher M. Bruno | Feb 16, 2023 | America Invents Act, Patents

Considering whether the US Patent & Trademark Office (PTO) Director must complete review of the Patent Trial & Appeal Board’s (Board) inter partes review (IPR) decision within the statutory deadline for a final written decision, the US Court of Appeals for the Federal Circuit concluded that the statute imposes no such requirement. CyWee Group Ltd. v. Google LLC et al., Case Nos. 20-1565, -1567 (Fed. Cir. Feb. 8, 2023) (Prost, Taranto, Chen, JJ.).

In 2018, Google filed two IPR petitions challenging certain claims of CyWee’s patents. The Board issued its final written decisions in January 2020, determining that all challenged claims were unpatentable for obviousness. CyWee appealed to the Federal Circuit in March 2020. In addition to challenging the patentability decision, CyWee challenged the appointment of Board administrative patent judges (APJs) as unconstitutional in view of the Appointments Clause. In March 2021, the Court affirmed the Board’s decisions and rejected CyWee’s constitutional challenge. The Court issued its mandate on June 10, 2020.

Eleven days later, the Supreme Court of the United States issued its decision in United States v. Arthrex, Inc., holding that APJs’ power to render final patentability decisions unreviewable by an accountable principal officer gave rise to an Appointments Clause violation but this violation could be remedied by, among other things, remanding to the acting PTO Director to decide to rehear the case. In response to a request from CyWee, the Federal Circuit recalled the mandate and remanded “for the limited purpose of allowing CyWee the opportunity to request Director rehearing of the final written decisions,” and required CyWee to inform the Court within 14 days of any decision denying rehearing. On remand, the Commissioner for Patents denied rehearing and ordered that the already-issued final written decisions were final decisions of the PTO. CyWee appealed.

CyWee contended that the post-Arthrex, mandated review by the PTO Director was untimely—and thus violative of due process—because the PTO Director did not have the ability to review the institution decision and final written decision within their respective three-month and one-year statutory deadlines. The Federal Circuit disagreed, calling CyWee’s contentions “meritless.” Rather, the Court found that because the PTO Director had permissibly delegated to the Commissioner for Patents authority to render institution and final decisions to the Board, those decisions were timely so long as the PTO Director’s delegees rendered them within the statutorily prescribed periods. By contrast, the PTO Director’s final review authority—a constitutional necessity born from Arthrex—has no similar statutory deadline.

CyWee also argued that the PTO Director’s later review was too late to satisfy a general requirement that the PTO Director consider the effect of regulations on the PTO’s ability to timely complete instituted IPRs. The Federal Circuit rejected this argument too, finding that even if the statute imposed a general timeliness requirement that was subject to judicial review, nothing about the process afforded to CyWee would have violated such a requirement.

With a different spin on the timeliness issue, CyWee also argued that the Board’s extension [...]

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Ninth Circuit Extends § 230 Immunity to Domain Name Registrars

by Kavya Rallabhandi | Feb 16, 2023 | Trademarks

The US Court of Appeals for the Ninth Circuit affirmed a district court’s dismissal of the plaintiff’s suit against a domain name registrar, holding that the plaintiff did not adequately allege that the registrar used the disputed trademark “in commerce” as required by the Lanham Act. The Court also extended immunity under the Communications Decency Act to include domain name registrars. Rigsby v. GoDaddy Inc. et al., Case No. 21-16182 (9th Cir. Feb. 3, 2023) (Clifton, McKeown, Thomas, JJ.).

Scott Rigsby, the first double leg amputee to complete an IRONMAN triathlon and founder of the Scott Rigsby Foundation (a nonprofit for wounded veterans and disabled persons), registered the domain name “scottrigsbyfoundation.org” with GoDaddy.com in 2007. GoDaddy is the world’s largest domain name registrar. When Rigsby failed to renew the domain name in 2018 because of a billing glitch, a third party registered the domain name and changed the content to an online gambling site. Rigsby filed suit against GoDaddy in the US District Court for the Northern District of Georgia, seeking declaratory judgment and alleging Lanham Act and state law claims. The suit was transferred to the US District Court for the District of Arizona pursuant to the forum selection clause in GoDaddy’s terms of service. The district court dismissed all claims with prejudice. Rigsby appealed, challenging dismissal and transfer of venue.

The Ninth Circuit affirmed dismissal. As an initial matter, the Court determined that it lacked jurisdiction to review the transfer order because the transferor fell within the Eleventh Circuit.

Turning to the Lanham Act claims under 15 U.S.C. § 1125(a), Rigsby alleged that GoDaddy knowingly provided use of the domain name in a deceptive manner. The Ninth Circuit rejected this argument for two reasons. First, § 1125(a) has a use in commerce requirement, and GoDaddy simply granted the third-party gambling site access to the domain name. The Court held that the third party’s use in commerce does not subject the registrar to liability for trademark infringement or unfair competition. Second, as a domain name registrar that did not engage in activities other than registration, GoDaddy is shielded from liability for cybersquatting under the Anticybersquatting Consumer Protection Act (ACPA). Importantly, the Court held that the plaintiff did not prove that GoDaddy registered, used or trafficked the domain name with a bad-faith intent to profit—a registrar’s lack of intervention with an infringing third-party use is not equivalent to use in commerce or active promotion of infringement.

The Ninth Circuit also barred Rigsby’s state law claims and related injunctive relief, explaining that GoDaddy is entitled to statutory immunity under Section 230 of the Communications Decency Act (CDA). (See § 230(c)(1) (“[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider”).) The Court identified three reasons why GoDaddy qualifies for CDA immunity. First, the Ninth Circuit joined the Second Circuit in ruling that domain name registrars and website hosting companies qualify as interactive computer services because [...]

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You Can’t Skirt around Obviousness by Arguing Expectation of Success Must Be Absolute

by Alexandra Cavazos, PhD | Feb 16, 2023 | Patents

Affirming an obviousness decision by the Patent Trial & Appeal Board (Board), the US Court of Appeals for the Federal Circuit explained that the expectation of success need only be reasonable and not absolute. Transtex Inc. v. Vidal, Case No. 20-1140 (Fed. Cir. Feb. 3, 2023) (Prost, Reyna JJ.) (Schall, J. dissenting).

Transtex makes aerodynamic trailer skirts, which improve fuel efficiency by reducing air drag. Transtex sued WABCO in the US District Court for the Eastern District of Michigan, alleging that WABCO’s trailer skirts infringed several Transtex patents. WABCO responded by filing two inter partes review (IPR) petitions, one of which was against a patent with claims directed to “resilient” trailer skirts and the “resilient” struts used to attach them to a trailer.

WABCO argued that the challenged claims of the patent were obvious over a combination of the Layfield and Rinard references. WABCO submitted expert declarations stating that a person of ordinary skill in the art would have recognized that Layfield’s rigid struts could benefit from being constructed of resilient, more flexible material. Accordingly, a skilled artisan would have been motivated to look to other, similar types of trailer components that are also flexible—like that disclosed in Rinard—to improve upon Layfield’s rigid struts. WABCO successfully relied on much of the same expert testimony to argue that a skilled artisan would also have enjoyed a reasonable expectation of success in combining the more rigid struts of Layfield with the compressible materials taught in Rinard because Rinard taught the utility of having compressible “air scoops” at the tail end of a trailer, which would compress downwards when the trailer contacted a loading dock.

The Board agreed with WABCO and found the challenged claims obvious. According to the Board, Layfield taught all of the claim limitations except for a “resilient strut” that could flex both toward the center of the trailer and away from the center of the trailer and then regain its shape while Rinard taught the benefits of using compressible air scoops made out of a resilient material as part of a trailer skirt system. The Board also concluded that a skilled artisan would have been motivated to combine Layfield with Rinard and would have had a reasonable expectation of success, given the predictable nature of the field. Transtex appealed.

The Federal Circuit affirmed, finding that substantial evidence in the form of expert testimony supported the Board’s finding that although Layfield taught a more rigid strut instead of a resilient strut as claimed, a skilled artisan would have been motivated to combine Layfield’s strut with the resilient materials disclosed in Rinard and would have enjoyed a reasonable expectation of success when doing so. The Court concluded that this was a case where the evidence of motivation to combine, which “everyone agrees meets the substantial evidence threshold,” significantly overlapped with the evidence relating to a reasonable expectation of success, so it was correct to conclude that a skilled artisan would have reasonably expected the resiliency benefit that motivated them to combine [...]

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Things May Be Bigger in Texas, but Not Necessarily More Convenient

by Benjamin Ediger, Ph.D. | Feb 16, 2023 | Patents

The US Court of Appeals for the Federal Circuit granted a mandamus petition after analyzing the Fifth Circuit’s public and private interest factors for transfer motions and ordered the US District Court for the Western District of Texas to transfer a case to the petitioner’s venue. In re Google LLC, Case No. 23-101 (Fed. Cir. Feb. 1, 2023) (Lourie, Taranto, Stark, JJ.).

Jawbone Innovations, LLC, had an eventful 2021:

February: Incorporated in Texas
May: Obtained ownership of nine patents (all directed to technologies behind the eponymous product line that liquidated in July 2017)
August: Rented office space in Waco, Texas
September: Asserted the nine patents it just acquired against Google in the Western District of Texas–Waco Division.

Google moved to transfer the dispute to the US District Court for the Northern District of California. That district was where (1) the accused products (earbuds, smartphones, speakers, displays and software) were researched, designed and developed; (2) the asserted technology was developed, and the asserted patents were prosecuted; and (3) the witnesses and sources of proof were primarily located. In contrast, no witnesses or sources of proof were located in the Western District of Texas. Moreover, Jawbone Innovations had no personnel in Waco nor activities related to the accused technology in the whole of Texas.

Judge Albright nevertheless denied Google’s transfer motion, weighing the Fifth Circuit’s four public interest factors and four private interest factors and finding that the transferee venue failed to meet the Fifth Circuit’s “clearly more convenient” standard. With the district court finding half of the eight factors not favoring either the transferee or the transferor, its holding boiled down to a ruling that considerations of “court congestion” and “judicial economy” (found to favor the transferor) outweighed considerations of “unwilling witness compulsion” and the “cost of attendance for willing witnesses” (found to favor the transferee).

Google petitioned the Federal Circuit for a writ of mandamus. The Court, applying the Fifth Circuit’s eight factor test, identified clear error in the district court’s analysis of five of the factors.

First: Addressing the “cost of attendance for willing witnesses” factor, the Federal Circuit found error in the district court’s conclusion that this factor only slightly favored transfer. Rather, the Court explained that this factor “weigh[ed] heavily in favor of transfer” because the transferee venue was clearly more convenient for potential witnesses, especially Google employees with technical, marketing and financial knowledge of the accused products. The error was localized to how the district court considered a Google declaration identifying at least 11 potential employee witnesses (all of whom were located in the transferee venue) and Jawbone Innovations’ assertions that the declaration omitted three potentially relevant Texas-based employees. The Court noted that while this 11 to three imbalance alone was sufficient to settle this factor, the district court’s error went further, finding Google’s declaration unreliable and less worthy of consideration because of the alleged omissions. The Federal Circuit determined this was error on error because the district court improperly ignored that the depositions [...]

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It’s PRUdent to Refrain from Cybersquatting: ACPA Applies to Domain Name Re-Registration

by Kavya Rallabhandi | Feb 9, 2023 | Technology, Trademarks

The US Court of Appeals for the Fourth Circuit joined the Third and Eleventh Circuits in ruling that the re-registration of an infringing domain name with a bad faith intent to profit violates the Anti-Cybersquatting Consumer Protection Act (ACPA). Prudential Ins. Co. of Am. v. Shenzhen Stone Network Info. Ltd., Case No. 21-1823 (4th Cir. Jan. 24, 2023) (Diaz, Thacker, Floyd, JJ.)

The ACPA, 15 U.S.C. § 1125(d), protects trademark owners from cybersquatters that register, traffic in, or use a domain name “identical or confusingly similar to or dilutive of” a distinctive or famous mark with the “bad faith intent to profit.” The ACPA jurisdictional requirement states that a trademark owner may either establish that a court has in personam jurisdiction over the defendant or, if personal jurisdiction cannot be established, bring an in rem action against the domain name.

Prudential Insurance Company of America’s trademark portfolio includes the term PRU and other PRU-formative marks. Shenzhen Stone Network Information (SSN) acquired the domain name PRU.COM from an online domain name marketplace, which leads to a parked page containing advertisements displaying Prudential’s trademarks and the marks of Prudential’s competitors. Prudential attempted to acquire the PRU.COM domain name twice—once through a domain name brokerage service and once after filing a Uniform Domain Name Dispute Resolution Policy (UDRP) administrative action with the World Intellectual Property Organization (WIPO). SSN rejected both offers. SSN claimed that it planned to develop the website into a foreign exchange and economic news platform, but it never substantively altered the parked page. Prudential subsequently dismissed the UDRP action and filed suit in the Eastern District of Virginia alleging cybersquatting and infringement against the CEO of SSN, Zhang (in personam), and PRU.COM (in rem). Zhang moved to dismiss the action or transfer it to the District of Arizona for lack of personal jurisdiction and in rem jurisdiction. The district court held that although it lacked personal jurisdiction over Zhang, in rem jurisdiction was appropriate at the time the complaint was filed. The district court then dismissed Prudential’s trademark infringement claim as moot, granted summary judgment to Prudential on its cybersquatting claim and ordered SSN to transfer the PRU.COM domain name. SSN timely appealed to the Fourth Circuit.

The Fourth Circuit, reviewing the district court ruling de novo, affirmed. As an initial matter, the Court held that the district court had proper in rem jurisdiction over the PRU.COM domain name because Zhang, as a corporate officer of SSN, lacked standing to defend SSN’s property interests and the domain name registry was located in Virginia. Moreover, in rem jurisdiction is assessed at the time the complaint is filed and cannot be destroyed during the pendency of the case if a proper defendant is later revealed.

Regarding the ACPA claim, SSN argued that since the initial domain name registrant registered PRU.COM in good faith, SSN, as a re-registrant, is not subject to the ACPA. The Fourth Circuit joined the Third and Eleventh Circuits in holding that the term “registration” in the ACPA is [...]

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KSR Does Not Extend to Design Patents (Yet)

by Courtney Seams | Feb 9, 2023 | Patents

Addressing the standard for obviousness of design patents, the US Court of Appeals for the Federal Circuit, in a per curiam opinion, upheld the Patent Trial & Appeal Board’s finding that a challenged design patent was not obvious over the pre-KSR design patent obviousness test or anticipated. LKQ Corporation v. GM Global Technology Operations, Case No. 21-2348 (Fed. Cir. Jan. 20, 2023) (per curiam) (Lourie, J., concurring) (Stark, J., concurring).

GM owns a design patent for the fender of a vehicle. LKQ Corp. previously held a license to the patent from GM, but negotiations to renew the license failed. Because LKQ continued to manufacture the fender after the expiration of the license, GM sent LKQ notice that it was infringing the patent. In response, LKQ petitioned for an inter partes review against GM, alleging that the patent was obvious and/or anticipated.

The Board found that LKQ had not presented enough evidence to prove that the patent was obvious or anticipated. For purposes of evaluating the obviousness of the design over prior art, the Board defined ordinary observers as “retail consumers who purchase replacement fenders and commercial replacement part buyers.” The Board concluded that, from the perspective of the ordinary observer, there were multiple differences between the patented design and the key reference, a prior art design patent. LKQ appealed.

LKQ argued that the Board erred in finding that there was no anticipation and in applying the obviousness tests of In re Rosen (C.C.P.A. 1982) and Durling v. Spectrum Furniture (Fed. Cir. 1996) because the Supreme Court of the United States overruled those tests in KSR International v. Telflex (2007).

The Federal Circuit upheld the Board’s definition of the ordinary observer. The Court found that retail purchasers of the entire vehicle would not be included in the ordinary observer group because purchasers of the product embodying the design are interested in the part itself, not the vehicle as a whole. The Court went on to uphold the Board’s application of the ordinary observer obviousness test, agreeing that the patented design created different overall impressions from the prior art for purposes of both obviousness and anticipation.

The Federal Circuit then addressed whether KSR overruled the Durling and Rosen tests for obviousness of design patents. The Court found that LKQ properly preserved the argument for appeal by asserting it in its opening brief to the Board. The Court then found that it was unclear whether the Supreme Court overruled Durling and Rosen, and therefore the Court was bound to apply the existing law. In applying the Durling and Rosen tests, the Court found that LKQ had failed to identify “the correct visual impression created by the patented design as a whole” because the prior art patent lacked certain key design features of the patented design. Thus, the Court affirmed the Board’s finding that the patent was not obvious.

Judge Lourie provided an additional opinion and addressed LKQ’s argument that KSR overruled Rosen. Lourie stated that because KSR did not involve design patents, which [...]

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Actual Confusion Is the Best Evidence of Confusion

by Ashley T. Brzezinski | Feb 9, 2023 | Trademarks

The US Court of Appeals for the Eighth Circuit reversed and vacated a district court’s preliminary injunction grant in a trademark dispute, concluding that potential confusion is insufficient to satisfy the burden of showing a substantial likelihood of confusion. H&R Block, Inc.; HRB Innovations, Inc. v. Block, Inc., Case Nos. 22-2075; -2023 (8th Cir. Jan. 24, 2023) (Gruender, Erickson, JJ.) (Melloy, J., dissenting).

H&R Block was founded in 1955 and specializes in income tax preparation and other tax and financial services. Over the years, H&R Block has invested billions of dollars in advertising campaigns and has developed significant market presence both in person and online. The company has also obtained several federal registrations directed to the use of a green square logo with its products and asserts that in addition to “H&R Block” it is known as just “Block.”

Square, Inc., is the company behind the Square payment card reader and point-of-sale software that allows individual sellers to accept credit card payments. Square was founded in 2009 and grew over time by acquiring or developing other businesses. Cash App is one of Square’s businesses. Cash App started in 2013 as Square Cash and is a purely digital platform that allows users to deposit and store money on the app. In November 2020, Square acquired free tax credit service Credit Karma Tax, which was rebranded as Cash App Taxes and integrated into the Cash App platform for the 2022 tax season. In December 2021, Square was renamed Block, Inc., and the name change was publicized via Twitter.

Fifteen days after the name change was announced, H&R Block filed suit alleging trademark infringement. Shortly thereafter, H&R Block moved for a preliminary injunction. The district court analyzed the marks at issue for likelihood of confusion and granted, in part, H&R Block’s request for a preliminary injunction. Block appealed.

The Eighth Circuit analyzed a list of six non-exclusive and non-exhaustive factors in assessing likelihood of confusion:

The strength of the owner’s mark
The similarity of the owner’s and the alleged infringer’s marks
The degree to which the products compete with each other
The alleged infringer’s intent to pass off its goods as those of the trademark owner
Incidents of actual confusion
The type of product, its cost and its conditions of purchase.

The Eighth Circuit agreed with the district court that H&R Block had demonstrated that its registered and common law marks were commercially strong but found that the record as a whole did not weigh in favor of H&R Block on the similarity factor because there were observable differences between the two logos and the competing products.

The Eighth Circuit indicated that ultimately the best evidence of likelihood of confusion is actual consumer confusion. While the record supported possible confusion by some consumers, the Court found that the district court had erred in finding actual consumer confusion and that H&R Block had not presented sufficient evidence to rise to the level of substantial confusion by an appreciable number of ordinary consumers. [...]

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Your Gang Did What!? No Matter—No Forfeiture of IP

by Kathleen Lynch | Jan 26, 2023 | Trademarks

In a unique case blending intellectual property and criminal law, the US Court of Appeals for the Ninth Circuit agreed that a district court properly exercised jurisdiction over a motorcycle club and upheld the lower court’s finding that the club did not have to forfeit its collective membership marks. United States v. Mongol Nation, Case Nos. 19-50176; -50190 (9th Cir. Jan. 6, 2023) (Ikuta, Forrest, Thomas, JJ.)

Mongol Nation is an unincorporated association comprised of Mongols Gang members and, per the district court, is “a violent, drug trafficking organization.” After a jury found Mongol Nation guilty of both substantive and conspiracy violations of the Racketeer Influenced and Corrupt Organizations (RICO) Act, the US government sought forfeiture of Mongol Nation’s rights in its collective membership marks—a category of “intellectual property used to designate membership in an association or other organization”—and specific property displaying those marks. A jury granted both forfeiture requests, but the district court granted forfeiture only of specific tangible property, not the marks themselves. The district court cited the First and Eighth Amendments: The First protected Mongol members’ rights to display their marks, and the Eighth prohibited the disproportionate remedy of forfeiture of marks that have “immense tangible” value to Mongol members. The government then filed another forfeiture application proposing that Mongol Nation forfeit its exclusive rights in the marks, meaning that Mongol Nation could not prevent others from using them, even in commerce, but that they would not transfer to or vest in the United States. The district court again denied this motion on First and Eighth Amendment grounds.

Both parties appealed, presenting two issues to the Ninth Circuit. Mongol Nation challenged the district court’s jurisdiction to hear the case because Mongol Nation is not a “person” under RICO. The government challenged the district court’s denial of forfeiture of the marks.

The Ninth Circuit summarily dealt with the first issue, noting that Mongol Nation did not properly raise this argument at the district court. The Court was not persuaded by Mongol Nation’s three-part argument that RICO defines an entity to be a “person” only if the entity has a legal interest in property, California only allows unincorporated associations to hold property if the association has a “lawful” purpose, and the indictment describes Mongol Nation as existing for an “unlawful purpose.” The Court found that the association misstated the indictment allegations, which said Mongol Nation’s purposes were “not limited to” the enumerated unlawful ones. Thus, because this argument was not properly preserved and because the RICO “person” definition did in fact encompass Mongol Nation, the Court found that the district court properly exercised jurisdiction.

The Ninth Circuit also affirmed the district court on the forfeiture issue, albeit for different reasons. Without reaching the district court’s First or Eighth Amendment logic, the Ninth Circuit stated that “RICO’s plain text” made the government’s forfeiture request “a legal impossibility.” The Court explained that, following a criminal conviction, a statute must enable property forfeiture. RICO does have such a penalty provision that encompasses [...]

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Bursting the Bubble on Prosecution Delays

by Christopher M. Bruno | Jan 26, 2023 | Patents

Addressing a case where a patent owner filed hundreds of applications as part of a strategy to maintain extraordinarily lengthy patent coverage, the US Court of Appeals for the Federal Circuit affirmed a district court’s determination that the patent owner had engaged in a calculated and unreasonable scheme to delay patent issuance. Personalized Media Comms., LLC v. Apple Inc., Case No. 21-2275 (Fed. Cir. Jan. 7, 2023) (Reyna, Chen, JJ.) (Stark, J., dissenting).

The Uruguay Round Agreements Act and General Agreement on Tariff and Trade (GATT) amended the US patent term to 20 years from the effective filing date, instead of 17 years from the issue date. GATT took effect on June 8, 1995. In the months leading up to GATT’s enactment, some would-be patentees seeded patent applications with tremendous disclosures to anchor future applications and obtain the longer pre-GATT term. Practitioners referred to this time period as the GATT bubble. Personalized Media Communications (PMC) submitted 328 GATT bubble applications, from which PMC sought somewhere between 6,000 and 20,000 patent claims. The term of these patents would be 17 years from their issue date instead of 20 years from their priority date.

PMC asserted that Apple’s FairPlay digital rights management software infringed a patent covering a decryption method and won a jury verdict of $330 million. After the verdict, the district court held a bench trial and ultimately found that the patent was unenforceable because of prosecution laches, a doctrine that bars the assertion of patents where the patentee caused unreasonable delay in obtaining the patent, to the detriment of the accused infringer. PMC appealed.

The Federal Circuit affirmed. First, it examined whether the district court had properly concluded that PMC unreasonably delayed. Based on a wide swath of record evidence, all three panel members—Judges Reyna, Chen and Stark—agreed that, like the patentee in Hyatt v. Hirschfeld, PMC had engaged in an intentional scheme to delay patent issuance and extend its monopoly. PMC tried to distinguish its case from Hyatt by arguing that it had developed, with the US Patent & Trademark Office, a consolidation procedure to prioritize review of certain applications. The Court concluded that the structure of the agreement still unreasonably drew out resolution of PMC’s applications, however. The Court also approved of the district court’s reasoning based on the number of applications filed and the introduction of new (albeit narrowing) elements to the claims 16 years after the priority date.

Turning to prejudice, the Federal Circuit concluded that the district court did not act improperly in determining that the delay and improper conduct continued to harm Apple up through the filing of suit in 2015. The Court found that the patent had issued based on a pending claim that PMC did not disclose during PMC-Apple license negotiations and which PMC could quickly get granted and assert against Apple.

Judge Stark dissented, stating that he would conclude that the prejudice Apple faced did not happen during the period in which PMC unreasonably delayed issuance. Judge [...]

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I Know That Brand . . . Or Do I? Reviewing the Eleventh Circuit’s Likelihood of Confusion Analysis

by Kavya Rallabhandi | Jan 26, 2023 | Trademarks

The US Court of Appeals for the Eleventh Circuit reversed and remanded a district court’s summary judgment ruling finding no likelihood that consumers might be confused as to any relationship between competitors operating in the same state, in similar trade channels and using a mark having the same primary word component. The Court held that a reasonable factfinder could determine that there was a likelihood of confusion between the parties’ marks as used in commerce. FCOA LLC v. Foremost Title & Escrow Services LLC, Case No. 19-13390 (11th Cir. Jan. 12, 2023) (Branch, Grant, Tjoflat, JJ.)

FCOA is an insurance company that has been selling and marketing insurance policies using FOREMOST marks since 1952. Foremost is a shell company selling title insurance on behalf of a law firm. Both parties operate in Florida. Seven months after Foremost started using its FOREMOST mark, FCOA sent Foremost a cease-and-desist letter. Foremost disputed the trademark infringement allegations and denied having any knowledge of FCOA or FCOA’s FOREMOST marks. The district court denied FCOA’s summary judgment motion and granted Foremost’s cross-motion for summary judgment, holding that FCOA failed to show a likelihood of confusion between the marks. FCOA appealed.

The Eleventh Circuit reviewed the district court decision de novo. Since there was no dispute that FCOA’s marks were valid, the Court focused its trademark infringement analysis on whether Foremost’s FOREMOST mark was likely to cause consumer confusion. It did so by analyzing its eight likelihood of confusion factors:

Actual confusion is the most important factor in the analysis. The Eleventh Circuit found no evidence that consumers actually confused the parties’ marks in the period between Foremost’s allegedly infringing acts and the lawsuit filing. Therefore, this factor weighed against a likelihood of confusion.
A mark’s strength/distinctiveness is the second most important factor because it analyzes the scope of the mark’s protection. The Eleventh Circuit found that FCOA’s FOREMOST mark was distinctive because, although the word mark in isolation is descriptive, it achieved secondary meaning through consumer recognition and commercial strength. The Court did not find Foremost’s list of likely inactive businesses using FOREMOST to be compelling rebuttal evidence. Therefore, this factor weighed in favor of a likelihood of confusion.
Similarity of the marks is relevant because the likelihood of confusion increases as the marks share more overall similarities. The Eleventh Circuit focused on the distinctive parts of the marks, noting that both logos feature FOREMOST prominently in bold, have two lines of text and are similarly centered and stylized. While there are differences in the logo fonts and colors, the Court determined that this factor still weighed in favor of confusion because consumers are unlikely to be discerning about these differences.

Similarity of the products that the marks represent is relevant in determining whether consumers think the marks originate from a single source. The Eleventh Circuit determined that [...]

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