Squirrels Armed with Bazookas

Exploring trends in reverse confusion cases, strategies for defending them, and ways to avoid or manage them

AIPLA 2016 Annual Meeting
Marriott Wardman Park - Washington, D.C.

Introduction

A nationwide seller decides on a new brand; it conducts trademark searches, verifies there are no obstacles to its use of the new mark, and applies to register it with the U.S. Patent and Trademark Office. It begins using the mark, and soon the mark develops massive consumer recognition – perhaps from extensive advertising, or media attention, or word of mouth. The mark becomes a very valuable brand for the company. And then comes a letter from the lawyer for a tiny company claiming rights to the same mark in a related field, demanding that it stop using this very valuable brand… or pay a huge sum for the right to keep using it. The lawyer threatens to bring a lawsuit for “reverse confusion.”

True reverse confusion occurs when a junior user saturates a senior user’s market with a similar trademark, and thereby overwhelms the senior user’s brand identity. The public quickly becomes more familiar with the senior user, and assume the senior user's goods and services are really the junior user's offering, or that the former has become somehow connected to the latter. “The result is that the senior user loses the value of the trademark – its product identity, corporate identity, control over its goodwill and reputation, and ability to move into new markets.”1

On the other hand, a reverse confusion case may be what one court called “a bazooka in the hands of a squirrel, used to extract from a more fearsome animal a bounty which the squirrel would never be able to gather by his own labors – at least not when the larger animal is mostly without sin.”2

This article will examine how reverse confusion cases are analyzed differently from forward confusion cases, and provide advice for defending against reverse confusion claims and preventative measures that can help a brand owner avoid them in the first place.

Application of confusion factors in the reverse confusion context

Trademark practitioners are well acquainted with the multi-factor tests for likelihood of confusion laid out by the various federal Courts of Appeal, which attempt to capture the conditions surrounding a customer’s encounter with a branded product that go into whether is likely to be confused as to the source or sponsorship of the product. The tests are basically the same in substance, although the number of factors varies from seven or eight up to as many as 13, depending on the circuit.3 Because reverse confusion occurs when a junior user’s brand saturates the senior user’s market by advertising or word-of-mouth, these conditions differ from paradigmatic forward confusion. Thus some of the confusion factors must be adjusted to track accurately the fact patterns associated with reverse confusion.

The following is a review of factors the courts typically consider in determining likelihood of confusion and how they may change in a reverse confusion case.

Strength of the mark

In the context of forward confusion we are accustomed to focusing on the strength of the senior user’s mark: both conceptual (its inherent distinctiveness) and in the marketplace (its recognition). A senior mark that is inherently distinctive “will be afforded the widest ambit of protection from infringing uses.”4 Likewise, a mark may be “strengthened by advertising”5, and a senior mark’s marketplace strength or fame will weigh in favor of a finding of likelihood of confusion.6 A highly distinctive or extensively advertised product is more likely to be in a purchaser’s mind when he or she encounters a similarly-branded good, and that will increase the likelihood the he or she will be confused about the latter product’s origin.

But in a reverse confusion case, it is the junior mark that the purchaser is already familiar with when he or she first encounters the less well-known senior mark. For this reason, where a small operator of Star Trek conventions under the mark DREAMWERKS sued the company behind the DREAMWORKS studio for reverse confusion, the Ninth Circuit explained that “[i]n a reverse confusion case, however, we must focus on the strength of the junior user's mark. [Citation omitted.] The concern here is that convention-goers will think DreamWorks SKG is sponsoring the Star Trek conventions. So the greater the power of DreamWorks' mark in the marketplace, the more likely it is to capture the minds of Dreamwerks customers.”7

By definition, the senior mark in a reverse confusion case will have low marketplace strength. Thus, in such a case the analysis of marketplace strength is inverted.8 Courts instead consider the commercial strength of the junior mark relative to the senior mark.9 A plaintiff with a commercially weak mark is therefore more likely have its brand identity overwhelmed by a senior user’s success, and thus more likely to experience reverse confusion.10

How, then, do courts evaluate conceptual strength in reverse confusion cases? Should that factor be inverted, too, and instead focus on the conceptual strength of the junior mark? The Third Circuit considered that question in A&H Sportswear, Inc. v. Victoria’s Secret Stores, Inc., where the maker of MIRACLESUIT swimwear alleged that Victoria’s Secret’s expansion of its THE MIRACLE BRA brand to swimwear was likely to cause reverse confusion. It held that “When it comes to conceptual strength, however, we believe that, just as in direct confusion cases, a strong mark should weigh in favor of a senior user.”11

In deciding that conceptual distinctiveness should be analyzed in the same way in both forward and reverse confusion cases, the A&H court cited with approval two district court opinions, including one from the Southern District of New York that explained: “if a customer saw a doll in a toy store bearing a strong familiar trademark like ‘Exxon,’ he might well assume that the oil company had gone into the toy business; if, on the other hand, he saw a doll bearing a familiar but weak laudatory trademark like Merit, he would be unlikely to assume that it is connected with the similarly named gasoline or cigarettes.”12

This shift in analyzing the “strength” factor can complicate things for plaintiffs alleging both reverse and forward confusion. Such cases do exist – as the Southern District of New York observed, “[f]orward and reverse confusion are not mutually exclusive, particularly where the junior user is apt to drown out the moderate success of the senior user.”13 Thus with respect to commercial strength, facts supporting one theory of confusion may cut against the other.

Relatedness of the goods in purchasers’ minds

In a forward confusion case, if customers consider the parties’ goods or services to be related enough that they expect them to come from the same company, confusion is more likely to occur.14 This is equally true in the context of reverse confusion, and so in both cases there is a comparison of the parties’ goods or services. Therefore this factor is left unchanged.

Similarity of the marks

As with relatedness of the goods, similarity of the marks is determined by comparing the marks in question, and therefore will be analyzed the same way in a reverse confusion case as in a forward confusion case.

Evidence of actual confusion

Actual confusion is not required to prove forward confusion – or reverse confusion – but courts consider credible evidence of true customer confusion (as opposed to “inquiry confusion” or “call to mind”) as strong evidence of likelihood of confusion.15 In a forward confusion case, anecdotal evidence that purchasers of the junior user’s product mistakenly believe that the senior user put out the product can weigh in favor of a finding of likelihood of confusion. The Ninth Circuit held in Rearden LLC v. Rearden Commerce, Inc. that non-consumer confusion – for example, among potential consumers, non-consumers whose confusion may create an inference of consumer confusion, and non-consumers whose confusion may influence customers – may also be relevant.16 A valid survey showing that potential purchasers of the junior user’s products mistakenly believe that the senior user is behind the product is also relevant to show likelihood of confusion.

 In a reverse confusion case, however, what matters is confusion among the senior user’s customers. But while in a forward confusion case the concern is that the junior user will get a free ride on the plaintiff’s goodwill, in that customers may buy the junior user’s product thinking that it is produced or licensed by the senior user, in a reverse confusion the concern is that customers may shun the senior user, because the junior user’s goods are undesirable to them or the goods have a bad reputation,17 or because the senior user’s goods are not what the junior user advertised, or that they might think that the senior user was actually the infringer.18

Anecdotal evidence of confusion

In Big O Tire Dealers, Inc. v. Goodyear Tire & Rubber Co., plaintiff Big O offered evidence that customers who purchased its BIG FOOT tires thought that the tires had been made by defendant Goodyear. The district court also received evidence that some potential customers came to Big O’s dealers asking for BIGFOOT tires because of Goodyear’s advertisements, but were disappointed because plaintiff’s BIG FOOT tires were not of radial construction like those Goodyear advertised.19

Besides customer disappointment, actual confusion can manifest itself in a reverse confusion case in the customer’s belief a customer’s belief that the senior user was infringing the junior user’s mark. The district court in Big O Tire concluded that “[b]ecause of the apparent and known difference in size between the companies, it was a reasonable and a natural consequence for people to assume that Goodyear had the exclusive legal right to the use of BIGFOOT as a trademark and that Big O was using that trademark illegally.”20 The court noted evidence that when a Big O dealer tried to put an ad reading “Home of BIG FOOT” in the Yellow Pages, the phone company refused “because the name BIGFOOT belonged to Goodyear.”21 That, of course, is not confusion of a customer as to source, but it is the kind of non-consumer confusion that the Ninth Circuit held in Rearden LLC v. Rearden Commerce, Inc. could be probative of actual confusion.

Survey evidence

Courts approach reverse confusion surveys differently from forward confusion surveys in two significant respects: (1) the proper universe of consumers is the senior user’s customer base, and (2) surveys in the format of the one used Squirtco v. Seven-Up Co.22 (“Squirt” survey) – in which the respondents are shown products of both the senior and junior users – may be disfavored.

As noted above, in a forward confusion case it is the junior user’s customers who are allegedly confused regarding the source of the junior user’s offerings. Accordingly, when constructing a survey the proper universe of consumers is the potential purchasers of the junior user’s goods and services. In a reverse confusion case, it is the senior user’s potential customers who are allegedly confused. As such, the proper universe for a survey is the senior user's customer base.23

The conditions that give rise to reverse confusion also render Squirt surveys inappropriate. Under the Squirt test, survey participants are shown an array of branded products, including both marks at issue, and participants are asked a series of questions in an effort to determine the extent to which participants associate the brands with one another. Squirt tests are accepted in forward confusion trademark disputes where the senior mark lacks a high degree of recognition and therefore it is necessary to prompt survey respondents’ recollection of it in the course of the survey. By the same token, they are often criticized for leading survey participants into drawing associations between the parties’ brands.

The leading nature of Squirt tests can be helpful where the parties’ marks are commercially weak, but in the reverse confusion context the junior user is by definition already well known. As a result, a Squirt survey may make create an artificial situation that places the two marks in proximity and thus leads the respondent to connect the two of them. To avoid leading respondents, reverse confusion surveys often follow the format of Union Carbide Corp. v. Ever-Ready, Inc.24 (“Eveready” survey), showing participants only the senior user’s mark and then asking questions to discern any perceived connection to the junior user.25

Duration of defendant’s use without evidence of actual confusion.

In a forward confusion case, the lack of evidence of actual confusion after an ample opportunity for confusion to occur “can be powerful indication that the junior trademark does not cause a meaningful likelihood of confusion.”26 The same is true in reverse confusion cases. In Cohn v. Petsmart, Inc., the plaintiff veterinarian presented “no evidence of actual confusion” arising from his use and the defendant pet supply chain’s use of the mark WHERE PETS ARE FAMILY.27 But because the parties used the same mark in the same city for six years for closely-related goods and services, the court concluded that “some evidence of actual confusion should have been available if Petsmart’s coexisting use had created a genuine likelihood of confusion.”28

Sales, advertising and marketing channels

The similarity of sales, advertising, and marketing channels is simply a comparison of how the parties promote and sell their products – the greater the similarity between the marketing and sales channels, the more likely consumers are to identify the parties’ offerings as originating from the same source. Thus, this factor is analyzed the same way in forward and reverse confusion case.

Sophistication of purchasers/care purchasers take when buying

The “sophistication of consumers” factor requires courts to consider the general impression of the ordinary purchaser, buying under the normally prevailing conditions of the relevant markets. It is reasoned that the more sophisticated the target consumer of a party (i.e., the more discerning, careful, knowledgeable, etc.), the less likely such consumers will be confused by the presence of similar marks in the marketplace.29 In the forward confusion context, it is the defendant’s consumers that are allegedly confused. The opposite is true with respect to reverse confusion; and courts naturally focus on the sophistication and carefulness of the plaintiff’s customers.30

Price of goods

Purchasers are typically more careful when buying an expensive product than a cheap one. In a forward confusion case, the likelihood of confusion will be higher if the defendant’s goods are inexpensive, and thus may be purchased on impulse, or without much care. But in a reverse confusion case, the focus is on confusion at the point of the customer’s consideration of the product bearing the less well-known senior mark, and thus the price point of the plaintiff’s goods is what matters.

Defendant’s intent in adopting the mark

Intent can be a powerful factor weighing in favor of a likelihood of confusion in a forward confusion case. Where a defendant is found to have intentionally traded upon the goodwill of the plaintiff’s mark, there is a presumption, or at least an evidentiary inference, that the defendant’s actions had their intended effect, i.e. that confusion occurred.31 In the Second and Ninth Circuits, for example, proof of a defendant’s intent to sow confusion shifts the burden to the defendant to disprove infringement.32 Prove intent, and a favorable outcome is likely to follow.

In a reverse confusion case, however, the defendant is not attempting to create confusion33 – reverse confusion only occurs when a junior user is particularly effective at creating its own brand identity and a high degree of recognition. As a consequence, courts have struggled with applying the intent factor against reverse confusion defendants, and there has been considerable inconsistency in the approaches taken across different jurisdictions.

One approach, adopted by courts in the Seventh Circuit, is to sideline intent entirely. Courts in the Seventh Circuit have concluded that because reverse confusion defendants do not intend to cause confusion, intent is irrelevant to determining whether confusion is likely.34 But even though a reverse confusion defendant does not intend to trade upon the goodwill of a senior mark, it could very well have adopted the mark with knowledge (and indifference) that confusion was likely or with the intent to push the senior user out of the market. There is no obvious reason why this type of misconduct, if it occurred, should not factor into a court’s confusion analysis.

Other courts have acknowledged that intent can be relevant, and have tried to reframe the issue in a manner consistent with reverse confusion. Some have considered whether the defendant "was careless in not conducting proper research,"35 others whether the defendant had the desire to "push the senior user out of the market,"36 or “whether the junior user adopted the infringing mark knowing, or recklessly disregarding, the senior user's mark.”37 Each of these applications of the intent factor captures culpable conduct that should, arguably, assist in a determination of whether infringement has occurred. Taken together they suggest a more fundamental inquiry: whether the junior user had a justified belief that confusion was unlikely at the time it adopted its mark.

A number of recent cases have more or less adopted this “justified belief” view of reverse confusion intent. For example, in a decision rendered earlier this year, the Western District of Michigan distinguished between the defendant’s knowledge of the plaintiff’s mark, and the defendant’s reasonable belief that its conduct would not result in confusion.38 In that dispute Progressive Distribution Services, Inc., a provider of order fulfillment infrastructure services, sued certain subsidiaries of United Parcel Service (“UPS”), alleging that UPS’s use of the mark UPS ORDERLINK had led consumers to believe that UPS was responsible for Progressive’s services offered under Progressive’s ORDERLINK mark.39 On the issue of intent, Progressive argued that UPS intended to cause confusion because it was aware of Progressive’s mark from a clearance search obtained prior to UPS’s decision to use UPS ORDERLINK.40 Emails obtained during discovery showed that UPS, in its initial assessment of the clearance search, concluded that the UPS ORDERLINK mark was unavailable due to Progressive’s prior rights.41

However, other evidence showed that UPS performed additional clearance searches that identified several third parties who were also using the term “OrderLink.”42 There was also testimony that UPS had reviewed Progressive's website and determined that Progressive's services were sufficiently distinct from the service that UPS planned to offer.43 On the court’s view, this evidence was sufficient to establish that even though UPS was aware of Progressive’s mark, it was justified in believing that the parties’ marks could coexist.44 As another court explained upon examination of similar facts, “courts must distinguish between a company's knowing decision to risk a law suit and a factual inference that customer confusion is likely."45

The “justified belief” approach to reverse confusion intent is a promising alternative to the Seventh Circuit’s disregard of the intent factor, but it requires further examination by the courts. It might make sense for courts to confer a presumption that confusion has occurred upon defendants shown to have intended to push a competitor out of the mark; it is, at best, questionable that the same presumption should be applied to defendants who, say, recklessly disregarded a senior mark or negligently failed to perform proper clearance. As noted earlier, intent in a forward confusion case is considered to be probative of actual confusion. No such inference could be drawn from a failure to properly conduct a clearance search, however. It appears that by permitting certain kinds of recklessness to impact the likelihood of confusion analysis, courts are making a policy decision to encourage brand owners to conduct reasonable trademark searches prior to the use of a mark, and to revisit past searches during periods of rapid growth.

Likelihood of expansion

If either party is likely to expand into the other party’s product line or geographical market – if one party’s goods are in the other’s natural zone of expansion – that will weigh in favor of a likelihood of confusion. This consideration is also relevant to reverse confusion, although it also bears on a type of harm particular to reverse confusion, namely, that the more well-known junior user, by generating massive consumer recognition, may foreclose the senior user from expanding.

Monetary remedies for reverse confusion

One of the more difficult and unsettled applications of trademark law to reverse confusion concerns the appropriate measure of damages. Monetary damages for forward confusion are normally calculated as the plaintiff’s lost sales from the infringement or as a proportion of the defendant’s profits as a proxy for lost sales.46 Reverse confusion does not readily lend itself to the same calculation of damages because the harm occasioned by reverse confusion is the loss of brand identity rather than a diversion of business or unjustly-obtained profit. As a result, courts have had to turn to other methods of calculating damages for reverse confusion, namely reasonable royalty fees and corrective advertising.

Reasonable royalty

The largest award of a reasonable royalty as damages for trademark infringement occurred in Sands, Taylor & Wood v. Quaker Oats Co., a dispute predicated on reverse confusion.47 The plaintiff, a small company that owned the mark THIRST-AID for beverages and food, successfully argued that Quaker Oats’ use of the slogan “GATORADE IS THIRST-AID” had resulted in reverse confusion and unjust enrichment of Quaker Oats; but the parties, and the court, struggled with identifying the proper measure of damages. Quaker Oats had earned tens of millions of dollars from the sale of Gatorade during the period of infringement – a far greater sum than the plaintiff could have hoped to earn during the same period.48 Awarding the plaintiff all Quaker Oats’ profits would have resulted in gross overcompensation, so the court instead settled upon an award of 10% of Quaker Oats’ profits from the relevant sales, or $24 million.49 This amount was intended to disgorge Quaker Oats of the financial benefit that it received as a result of its use of the infringing mark.50

On appeal, the Seventh Circuit rejected the outsized award as a windfall to the plaintiff, and suggested that the district court consider a reasonable royalty as an alternative baseline for determining an appropriate damages award. According to the court, this method would “more accurately reflect both the extent of Quaker's unjust enrichment and the interest of [plaintiff] that has been infringed.”51

The district court, with some reluctance, acquiesced. After reviewing the parties’ explanations for their competing royalty rate formulae, the district court determined that the appropriate award should be the equivalent of 1% of Quaker Oats ‘sales of the infringing product the first year and 0.5% thereafter, for a total of almost $10.5 million. The district court explained that the rate it arrived at reflected, among other things, the plaintiff’s prior licensing arrangements and the profitability of the defendant’s infringement. It was an “attempt to measure the value to [Quaker Oats] gained by the use of the [THIRST AID] mark.”52

Post-Sands, courts have tended to apply more scrutiny to whether damages based on a reasonable royalty are too speculative. As explained by one district court, “[a] reasonable royalty is the money the plaintiff would have made if the defendant had obtained a license.”53 But like any award of damages, a royalty rate must be proved with reasonable certainty.54 Facts that could establish a reasonable royalty rate may include prior conduct between the parties (such as a rebuked offer of a license) or conduct by the plaintiff alone (such as licenses or valuations prior to the lawsuit).55 But where the plaintiff has not engaged in licensing the mark at issue, any calculation of a royalty rate is liable to be purely speculative. Moreover, a royalty is in essence a payment for the benefit obtained by the goodwill imparted by the use of the licensor’s mark, and in a reverse confusion case, by definition the well-known junior user is trading only on its own reputation, and not that of the senior user.

Corrective advertising

An award of monetary damages for corrective advertising requires a defendant to pay the plaintiff an amount of money necessary to undo the confusion caused by the defendant’s infringement.56 It is said to be “a method of repair” whereby advertising restores the plaintiff’s mark to the value it would have had, had the infringement not occurred.57 Corrective advertising is a natural remedy for reverse confusion, particularly where the parties’ marks are non-competitive, because it enables a plaintiff to reclaim the distinctiveness of its brand after having been obscured as a result of the market saturation of the junior user.

Retrospective corrective advertising awards are measured by the amount of monies spent by the plaintiff on corrective advertising.58 Prospective corrective advertising awards, which are intended to compensate the plaintiff for the amount of advertising that would be required to dispel the confusion caused by defendant's infringement, are inherently speculative and therefore “may be difficult to determine precisely and present a danger of overcompensation if they exceed the value of the mark.”59 Plaintiffs may attempt to prove prospective corrective advertising through expert testimony,60 or by adopting the FTC’s regulations for corrective advertising, which consists of adding the by totaling the defendant’s advertising expenditures in the relevant geographic area during the period of infringement, and reducing that number by 75%.61

The FTC method of calculating corrective advertising awards was co-opted by the Tenth Circuit in the early, and influential, reverse confusion case, Big-O Tire Dealers, Inc. v. Goodyear Tire & Rubber Co. discussed above. There, a jury awarded plaintiff Big-O $2.8 million in compensatory damages for corrective advertising.62 That award was later reduced to $680,000, but remained considerably larger than the $200,000 valuation of the plaintiff’s company.63

The FTC method of approximating corrective advertising damages is now regularly applied to trademark infringement disputes.64 Since Big-O, however, courts have been more careful to tether the amount of corrective advertising to the value of the infringed mark. For example, in Fancaster, Inc. v. Comcast Corp., the district court held that in order for a plaintiff to prevail on a theory of corrective advertising, it must show that “'repair' of the old trademark, rather than adoption of a new one, is the least expensive way to proceed."65 The court reasoned that any award greater than the value of the plaintiff’s mark constitutes a windfall to the plaintiff, and is therefore inequitable. Similarly, in Trovan, Ltd. v. Pfizer, Inc., the record showed that at the time of infringement the value of the plaintiff’s goodwill did not exceed $500,000 and, as a result, an award of $5,000,000 was excessive as a matter of law.66 According to the Trovan court, any award should not have exceeded the established value of the plaintiff’s mark.67

How to defend against allegations of reverse confusion

In any trademark infringement dispute the likelihood of confusion factors provide the roadmap for constructing a defense. Whereas a plaintiff seeks to draw similarities between the parties’ marks, target markets, and channels of trade, the defendant attempts to distinguish them. Beyond this familiar framework, there is at least one focal point that can be pressed to a reverse confusion defendants’ advantage: the scope of any potential monetary liability.

An injunction is an equitable remedy, of course, and courts should take into account a plaintiff’s inequitable conduct in weighing whether to grant an injunction. It has been suggested that a plaintiff’s failure to seek registration of its mark or failure to list the mark in directories or other locations where a reasonable search might have uncovered is something that a court should consider, as well as unreasonable demands to “extort” money from a defendant who belatedly learns of the plaintiff.68

It naturally follows from the conditions that give rise to reverse confusion, i.e., a junior user’s saturation of a senior user’s market, that reverse confusion defendants are often relatively large and well capitalized. A plaintiff may perceive the larger junior user as having deep pockets and being willing to settle for a substantial sum in order to avoid a large award, not unlike the outsized awards in Sands and Big-O. In such a circumstance, the defendant will have to do what it can to reset the plaintiff’s expectations.

As discussed above, the awards of damages in Sands and Big-O are outliers, and, frankly, run contrary to the principles of equity embodied in 15 U.S.C. § 1117(a). An award of damages in a trademark case is intended to compensate a plaintiff for any harm suffered, rather than punish the defendant.69 As the law regarding damages has developed since Sands and Big-O, courts have been much more circumspect in awarding damages greater than the value of the plaintiff’s mark.70 It is therefore important to make clear to a reverse confusion plaintiff that the pot of gold they seek is not in the offing, particularly where the plaintiff is a much smaller company of limited value.

Mitigating the risk of reverse confusion

As with any cause of action, there is no panacea for preventing reverse confusion claims. But there are some preventative measures that can be taken to minimize the risk. The following list provides some (hopefully) helpful rules of thumb.

  1. Always perform a proper trademark clearance search prior to adopting a new trademark. This is obvious advice, but bears repeating.
  2. Do not be dismissive of common law references that appear in clearance searches.
  3. Companies experiencing rapid growth should consider revisiting common law risks and highly similar marks identified in past clearance searches.
  4. Companies should consider purchasing rights of senior users early, rather than waiting until they have committed to the mark and thus have given the senior user substantial leverage with which to bargain for a huge payout.

 


Notes
  1. Ameritech, Inc. v. Am. Info. Techs. Corp., 811 F.2d 960, 964 (6th Cir. 1987); see also Fortres Grand Corp. v. Warner Bros. Entm't Inc., 763 F.3d 696, 701 (7th Cir. 2014).
  2. Uber Promotions, Inc. v. Uber Technologies, Inc., 2016 WL 617450 *18 (N.D. Fla., Feb. 16, 2016)
  3. See, e.g., AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348–49 (9th Cir.1979) (eight factors); Interpace Corporation v. Lapp, Inc., 721 F.2d 460 (3d Cir. 1983) (10 factors); In re E.I. du Pont de Nemours & Co., 476 F.2d 1357 (CCPA 1973) (13 factors).
  4. AMF Inc. v. Sleekcraft Boats, 599 F.2d at 349.
  5. Id. at 350.
  6. In re E.I. du Pont de Nemours & Co., 476 F.2d at 1362.
  7. Dreamwerks Production Group, Inc. v. SKG Studio, 142 F. 3d 1127, 1130 n.5, citing Sands Taylor & Wood Co. v. Quaker Oats Co., 978 F.2d 947, 959 (7th Cir. 1992).
  8. A&H Sportswear, Inc. v. Victoria’s Secret Stores, Inc., 237 F.3d 198, 231 (3d Cir. 2000).
  9. Id.
  10. First Nat'l Bank of Omaha, Inc. v. Mastercard Int'l, Inc., 2004 WL 1575396 *12 (S.D.N.Y. 2004) ("For both forward and reverse confusion claims, a plaintiff with a conceptually weak mark is less likely to prevail. A plaintiff with a mark that is commercially weak, however, is likely to succeed in establishing reverse confusion, particularly against a defendant with a far stronger mark."); THOIP v. Walt Disney Co., 736 F. Supp. 2d 689, 694 (S.D.N.Y. 2010).
  11. A&H Sportswear, 237 F.3d at 231.
  12. H. Lubovsky, Inc. v. Esprit de Corp., 627 F. Supp. 483, 487 (S.D.N.Y. 1986).
  13. THOIP v. Walt Disney Co., 736 F. Supp. 2d 689, 694 (S.D.N.Y. 2010) (explaining that forward and reverse confusion are not mutually exclusive).
  14. A&H Sportswear, 237 F.3d at 224.
  15. Union Carbide Corporation v. Ever-Ready Incorporated, 531 F.2d 366, 383 (7th Cir. 1976) (explaining that “courts often view evidence of actual confusion as the best evidence of likelihood of confusion, though isolated instances of actual confusion or misdirected mail have been held insufficient to sustain a finding of likelihood of confusion.”).
  16. Rearden LLC v. Rearden Commerce, Inc., 683 F.3d 1190, 1215 (2012).
  17. Uber Promotions, Inc. v. Uber Technologies, Inc. 2016 WL 617450 *6 (N.D. Fla., Feb. 16, 2016) (a harm of reverse confusion is where “the senior user loses the value of its trademark-its product identity, corporate identity, control over its goodwill and reputation, and ability to move into new markets”) (quoting Ameritech, Inc. v. Am. Info. Tech. Corp, 811 F.2d 960, 964 (6th Circ. 1987).
  18. Big O Tire Dealers, Inc. v. Goodyear Tire & Rubber Co., 408 F. Supp. 1219, 1229 (D. Colo. 1976).
  19. Id.
  20. Id.
  21. Id.
  22. 628 F.2d 1086, 1089 n.4, 1091 (8th Cir. 1980).
  23. Citizens Fin. Grp., Inc. v. Citizens Nat. Bank of Evans City, 383 F.3d 110, 121 (3d Cir. 2004); Sterling Drug, Inc. v. Bayer AG, 14 F.3d 733, 741 (2d Cir. 1994); Fancaster, Inc. v. Comcast Corp., 832 F. Supp. 2d 380, 403 (D.N.J. 2011).
  24. 531 F.2d 366, 385-88 (7th Cir. 1976).
  25. See, e.g., Kargo Global, Inc. v. Advance Magazine Publishers, Inc., 2007 WL 2258688, *8 (S.D.N.Y. 2007) ("Here, where [plaintiff] has alleged that reverse confusion has occurred . . . , it would have been far more replicative of actual marketplace conditions to have [used] . . . the Eveready format. A survey that utilizes the Eveready format, by displaying only a single party's mark and attempting to discern whether respondents are confused as to the source of the mark, is much more reliable because it more accurately approximates actual market conditions by ensuring that respondents are not made artificially aware of the other party's trademark." (citations & quotations omitted)); Denimafia Inc. v. New Balance Ath. Shoe, Inc., 2014 U.S. Dist. LEXIS 27541, *93-98 (S.D.N.Y. 2014).
  26. Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208, 228 (2dCir.1999).
  27. Cohn v. PetSmart, Inc. 281 F.3d 837, 842 (9th Cir. 2002).
  28. Id. at 842-43.
  29. Savin Corp. v. Savin Group, 391 F.3d 439, 461 (2d Cir.2004).
  30. Sterling, 14 F.3d at 742 ("This case primarily involves reverse confusion, where consumers mistake [plaintiff's] products as originating with [defendant]. In such a case, the consumers relevant to the purchaser sophistication inquiry are those who purchase [plaintiff's] products."); Denimafia, 2014 U.S. Dist. LEXIS 27541 at *113.
  31. Samara Bros. Inc. v. Wal-Mart Stores Inc., 165 F.3d 120 (2d Cir. 1998) rev'd on other grounds 529 U.S. 205, 120 (2000) (explaining that intentionally deceptive conduct serves as a proxy for actual consumer confusion).
  32. Mobil Oil Corp. v. Pegasus Petroleum Corp., 818 F.2d 254 (2d Cir. 1987); Interstellar Starship Services, Ltd. v. Epix Inc., 184 F.3d 1107 (9th Cir. 1999), cert. denied, 528 U.S. 1155 (2000).
  33. See 5 McCarthy on Trademarks and Unfair Competition § 23:10 (4th ed.).
  34. Poneman v. Nike, Inc., 2016 U.S. Dist. LEXIS 17662, *19 (N.D. Ill. 2016) ("[t]he 'intent' factor of the likelihood of confusion analysis is essentially irrelevant in a reverse confusion case.") quoting Sands, Taylor & Wood Co. v. Quaker Oats Co., 978 F.2d 947, 961 (7th Cir. 1992); see also Stuart J. Kaufman, M.D. & Assocs., P.A. v. Bausch & Lomb Inc., 2013 WL 6154166, *10 (M.D. Fla. 2013) (“The standard for intent in reverse confusion cases is an open question in this circuit.”)
  35. Mars Musical Adventures, Inc. v. Mars, Inc., 159 F. Supp. 2d 1146, 1152 (D. Minn. 2001) (citation omitted). Altira Group LLC v. Philip Morris Companies Inc., 207 F. Supp. 2d 1193, 1200, 63 U.S.P.Q.2d 1438, 1443 (D. Colo. 2002) (finding that the junior user Phillip Morris identified the senior user's federal registration for ALTIRA venture capital investment services when it conducted a thorough trademark search and was advised by in-house counsel that use of ALTRIA as a new corporate name for Phillip Morris would not be in conflict. "There is no indication of carelessness, indifference or otherwise culpable conduct by Phillip Morris in making the selection." Preliminary injunction denied.); Commerce Nat., Inc. v. Commerce Ins. Agency, Inc., 214 F.3d 432, 444 (3rd Cir. 2000) (stating that, in a reverse confusion case, "the intent inquiry must also be altered to focus on whether the defendant was aware of the senior user's use of the mark in question, or whether the defendant conducted an adequate name search for other companies marketing similar goods or services under that mark"), cited with approval in Cohn v. Petsmart, Inc., 281 F.3d 837, 843 (9th Cir. 2002).
  36. Freedom Card, Inc. v. JPMorgan Chase & Co., 432 F.3d 463, 473 (3d Cir. 2005) (citation omitted).
  37. Coryn Group II, LLC v. O.C. Seacrets, Inc., 868 F. Supp. 2d 468, 487-488 (D. Md. 2012).
  38. Progressive Distrib. Servs. v. UPS, 2016 U.S. Dist. LEXIS 63980, *27-29 (W.D. Mich. 2016).
  39. Id. at * 8.
  40. Id. at *26-28.
  41. Id. at *26-27.
  42. Id. at *27.
  43. Id. at *27-28.
  44. Id. at *28-29.
  45. Pub. Impact, LLC v. Boston Consulting Grp., Inc., 2016 U.S. Dist. LEXIS 31552, *23 (D. Mass. 2016) (internal quotations omitted). See also, Flushing Bank v. Green Dot Corp., 138 F. Supp. 3d 561, 591 (S.D.N.Y. 2015) (explaining that courts should ask “did the junior user select the mark with an honestly held belief that its use would be non-infringing? Did the junior user choose the mark because it was descriptive of its good or service or the product's characteristics? Did the junior user perform a trademark search and did it rely on the advice of counsel?”).
  46. See 5 McCarthy on Trademarks and Unfair Competition §§ 30:59, 30:72 (4th ed.).
  47. 34 F.3d 1340, 1344 (7th Cir. 1994).
  48. Sands, Taylor & Wood v. Quaker Oats Co., 1990 WL 251914, at *21-23 (N.D. Ill. 1990), aff'd in part, rev'd in part sub nom. Sands, Taylor & Wood Co. v. Quaker Oats Co., 978 F.2d 947 (7th Cir. 1992).
  49. Id. at *26.
  50. Id. at *21.
  51. Sands, Taylor & Wood, 978 F.2d at 963.
  52. Sands, Taylor & Wood Co. v. Quaker Oats Co., 1993 WL 204092, at *4 (N.D. Ill. 1993) aff'd in part, rev'd in part sub nom. Sands, Taylor & Wood v. Quaker Oats Co., 34 F.3d 1340 (7th Cir. 1994) on reh'g in part, 44 F.3d 579 (7th Cir. 1995) (internal quotations omitted).
  53. Trovan, Ltd. v. Pfizer, Inc., 2000 U.S. Dist. LEXIS 7522, *1, 2000 WL 709149 (C.D. Cal. 2000).
  54. Bauer Bros., LLC v. Nike, Inc., 2016 U.S. Dist. LEXIS 13012, *22-23 (S.D. Cal. 2016) quoting Quia Corp. v. Mattel, Inc., No. C 10-1902, 2011 U.S. Dist. LEXIS 76157, 2011 WL 2749576, at * 6 (N.D. Cal. 2011).
  55. Id.
  56. See Zazu Designs v. L'Oreal S.A., 979 F.2d 499, 24 U.S.P.Q.2d 1828, 1834 (7th Cir. 1992).
  57. Id.
  58. 5 McCarthy on Trademarks and Unfair Competition § 30:83 (4th ed.).
  59. Adray v. Adry-Mart, Inc., 76 F.3d 984, 989 (9th Cir. 1995), as amended on denial of reh'g (Feb. 15, 1996).
  60. See PODS Enterprises, LLC v. U-Haul Int'l, Inc., 126 F. Supp. 3d 1263, 1283 (M.D. Fla. 2015).
  61. Big-O Tire Dealers, Inc. v. Goodyear Tire & Rubber Co. 561 F.2d 1365, 1375-6 (10th Cir. 1977).
  62. Id.
  63. Id. at 1368, 1375-76.
  64. See e.g., Cache La Poudre Feeds, LLC v. Land O' Lakes, Inc., 2008 WL 269451, *3 (D. Colo. 2008); First Sav. Bank, F.S.B. v. U.S. Bancorp, 117 F. Supp. 2d 1078, 1088 (D. Kan. 2000); Great Am. Ins. Co. v. GRE Am. Corp., No. 1990 WL 305394, at *21 (S.D. Ohio 1990). But see, PODS Enterprises, LLC v. U-Haul Int'l, Inc., 126 F. Supp. 3d 1263, 1284 (M.D. Fla. 2015) (noting that Big O has not been adopted by the Eleventh Circuit)
  65. 832 F. Supp. 2d 380, 403 (D.N.J. 2011) (internal quotations omitted).
  66. 2000 WL 709149, at *15 (C.D. Cal. 2000).
  67. Id.
  68. A. Fletcher, The Curious Doctrine of Reverse Confusion – Getting it Right in Reverse, 95 Trademark Rep. 1273, 1306 (2005)
  69. 15 U.S.C. § 1117(a).
  70. See footnotes 44-45, supra.
Related Contacts
John Crittenden Partner, San Francisco
Judd Lauter Associate, Washington, DC
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Trademark, Copyright & Advertising