Initial Interest Confusion

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Initial Interest Confusion is a legal doctrine under trademark law that permits a finding of infringement when there is temporary confusion that is dispelled before the purchase is made. Generally, trademark infringement is based on the likelihood of confusion for a consumer in the marketplace. This likelihood is typically determined using a multi-factor test that includes factors like the strength of the mark and evidence of any actual confusion. However, trademark infringement that relies on Initial Interest Confusion does not require a likelihood of confusion at the time of sale; the mark must only capture the consumer's initial attention.

Contents

A famous hypothetical example of Initial Interest Confusion, first discussed in Brookfield v West Coast Entertainment , [1] involves two video stores. West Coast Video's competitor, Blockbuster Video, puts a billboard on a stretch of highway advertising a West Coast Video at an upcoming exit. In reality, there is no West Coast Video at this exit; it is a Blockbuster Video instead. The consumer, expecting to find a West Coast Video store, sees the Blockbuster Video and decides to patronize the suitable replacement. Even though the confusion has been dispelled, Blockbuster is still misappropriating the acquired goodwill of West Coast Video's trademark.

History

The Initial Interest Confusion doctrine has been applied by U.S. courts as early as 1975. However, with the appearance of the World Wide Web, Initial Interest Confusion claims have increased from 10 cases relying on the doctrine before 1990 to more than 100 between 1990 and 2005. [2]

Origin

Grotrian v Steinway & Sons

The first judgment involving Initial Interest Confusion was in Grotrian, Helfferich, Schults., Th. Steinweg Nachf. v Steinway & Sons, [3] although that exact expression is never used. At the time of the dispute, Grotrian, Helfferich, Schultz., Th. Steinweg Nachf. (also referred to as "Grotrian") was importing into the United States pianos labeled "Grotrian-Steinweg" and advertised under the name "Steinweg". Consequently, Steinway & Sons filled a trademark infringement suit against Grotrian. The parties are historically linked –the founder of Steinway & Sons, Henry E. Steinway, who had Anglicised his name from Heinrich Engelhard Steinweg after migrating to New York in 1850, had initially made pianos in Germany branded Steinweg, and his son partnered with Grotrian. When Steinweg/Steinway left for America, the German business was sold to the three employees, Grotrian, Helfferich and Schulz, with permission to use the "Steinweg" name.

On appeal, 2nd Circuit Judge W. H. Timbers confirmed the opinion of Judge L. F. MacMahon that "misled into an initial interest, a potential Steinway buyer may satisfy himself that the less expensive Grotrian-Steinweg is at least as good, if not better, than a Steinway." [4] The Appellate Court, however, recognized the likelihood of confusion may not exist at the time of purchase, because those who buy expensive pianos can be considered to be well informed. Instead, the Court held that actual or potential confusion at the time of purchase did not need to be demonstrated in this case. The motivation behind that decision was that "the Grotrian-Steinweg name would attract potential customers based on the reputation built up by Steinway in [the United States] for many years". The Court concluded that Grotrian was attempting to increase their sales based on the strength of the name of "Steinway" and that "such initial confusion works an injury to Steinway".

Mobil Oil Corp. v Pegasus Petroleum Corp.

The next significant decision [2] relying on Initial Interest Confusion was Mobil Oil Corp. v Pegasus Petroleum Corp.. [5] In this case, Mobil sued Pegasus Petroleum, an oil trading company founded in 1981, on the basis of a trademark infringement concerning the "Pegasus" name. Mobil is the holder of a registered trademark in both the flying horse symbol representing the Greek mythological figure of Pegasus, and the name "Pegasus" itself. [2] However, the logo of Pegasus Petroleum did not represent any sort of flying horse and solely consisted of two interlocking letters "P".

At the first trial, Judge L. F. MacMahon concluded that "there is a sufficient likelihood of confusion between Mobil's flying horse symbol and Pegasus Petroleum's use of the 'Pegasus' mark to grant Mobil relief under the Lanham Act." While finding the decision "not clearly erroneous", the 2nd Circuit Court clarified on Appeal that the likelihood of confusion had to be understood as a "likelihood that Pegasus Petroleum would gain crucial credibility during the initial phases of a deal". The Court concluded that Pegasus Petroleum was misleading potential customers because of their initial interest suggested by the Pegasus mark and holds that this initial confusion alone constitutes a sufficient trademark injury.

The Internet Era

Initial Interest Confusion has become much more visible in the Internet age. [2] Courts have upheld trademark infringement claims in domain names (cybersquatting), meta-tags that influence search engine results, and advertising keywords using the Initial Interest Confusion doctrine.

Brookfield Communications, Inc. v. West Coast Entertainment Corp.

In Brookfield Communications, Inc. v. West Coast Entertainment Corp., [1] the 9th Circuit embraces the Initial Interest Confusion doctrine which has previously been developed in the 2nd Circuit, and directly addresses the question whether registered trademark terms can be used as meta tags on web pages of non-trademark holders.

Brookfield developed a software, named MovieBuff, which consisted of a searchable database of past, current and upcoming films, their box office reviews, schedules, and other data. A federal trademark registration for "MovieBuff" was issued in 1998, covering both goods and services. In order to sell the MovieBuff software, Brookfield registered two domain names: moviebuffonline.com and brookfieldcomm.com in 1996. He also placed a version of the database online at inhollywood.com. Brookfield was not able to register the domain moviebuff.com at the time because West Coast has previously registered it.

West Coast, one of the nation's largest video rental store chains, subsequently launched on moviebuff.com an online movie database service similar to the one Brookfield had deployed. Furthermore, both this web site and westcoastvideo.com, the legitimate domain of West Coast, contained the meta keywords "moviebuff" and "moviebuff.com". These meta keywords were intended to be indexed by search engines, so that a consumer searching for "moviebuff" could find the page. While this was a common way to increase visibility in earlier search engines, most modern search engines do not rely on meta keywords for ranking results.

Although the 9th Circuit admitted that there was no likelihood of confusion between the two products, the Court nonetheless held West Coast liable for trademark infringement because the "moviebuff" trademark, as well as "moviebuff.com", appeared in the metatags of westcoastvideo.com, the non-infringing domain used by West Coast. The Court states "although there is no source confusion in the sense that consumers know they are patronizing West Coast rather than Brookfield, there is nevertheless initial interest confusion in the sense that, by using moviebuff.com or MovieBuff to divert people looking for MovieBuff to its web site, West Coast improperly benefits from the goodwill that Brookfield developed in its trademark."

Playboy Enterprises, Inc. v. Netscape Communications Corp.

In Playboy Enterprises, Inc. v. Netscape Communications Corp., [6] Playboy charged Netscape (along with Excite) for selling banner ads keyed on trademarked terms "playboy" and "playmate". A district court dismissed the case, citing fair use and other arguments. However, the Ninth Circuit drew comparisons to Brookfield v West Coast, [1] and came to the conclusion that "analogies to Brookfield suggest that PEI will be able to show a likelihood of confusion sufficient to defeat summary judgment. The Court held that Playboy was likely to show that consumers may be attracted to competitors' products by free riding Playboy's reputation when using the trademarks "playboy" and "playmate", even if the consumers are well aware that they are not buying services from Playboy.

Controversy

Several people have criticized the doctrine of Initial Interest Confusion. One concern is that Initial Interest Confusion "lacks a rigorous definition". [7] Others have said that, absent a coherent conception of damage to the trademark holder, initial interest confusion makes actionable not "actual damage incurred by the trademark holder" but something more like "brand indignation." [8] Additionally, some state that because Initial Interest Confusion can be found without the multi-factor analysis of likelihood of confusion, it represents "a short-cut to infringement, like a judicial game of 'Chutes and Ladders'" [9] Another concern is the lack of consensus among courts about the applicability of Initial Interest Confusion. [10] Judge Berzon of the Ninth Circuit, in a concurring opinion in Playboy Enterprises, Inc. v. Netscape Communications Corp., asked whether the court wanted "to continue to apply an insupportable rule", referring to Initial Interest Confusion as discussed in Brookfield. [6]

Notable cases

Related Research Articles

Steinway & Sons American piano company

Steinway & Sons, also known as Steinway, is a German-American piano company, founded in 1853 in Manhattan by German piano builder Heinrich Engelhard Steinweg. The company's growth led to the opening of a factory in New York City, United States, and later a factory in Hamburg, Germany. The factory in the Queens borough of New York City supplies the Americas, and the factory in Hamburg supplies the rest of the world.

A trademark is a word, phrase, or logo that identifies the source of goods or services. Trademark law protects a business' commercial identity or brand by discouraging other businesses from adopting a name or logo that is "confusingly similar" to an existing trademark. The goal is to allow consumers to easily identify the producers of goods and services and avoid confusion.

Lanham Act United States trademark law

The Lanham (Trademark) Act (Pub.L. 79–489, 60 Stat. 427, enacted July 5, 1946, codified at 15 U.S.C. § 1051 et seq. is the primary federal trademark statute of law in the United States. The Act prohibits a number of activities, including trademark infringement, trademark dilution, and false advertising.

Trademark dilution is a trademark law concept giving the owner of a famous trademark standing to forbid others from using that mark in a way that would lessen its uniqueness. In most cases, trademark dilution involves an unauthorized use of another's trademark on products that do not compete with, and have little connection with, those of the trademark owner. For example, a famous trademark used by one company to refer to hair care products might be diluted if another company began using a similar mark to refer to breakfast cereals or spark plugs.

<i>Playboy Enterprises, Inc. v. Welles</i>

Playboy Enterprises, Inc. v. Welles 60 F. Supp. 2d 1050 was a United States district court case between former 1981 Playboy Playmate of the Year ("PMOY") Terri Welles and Playboy Enterprises, Inc. in which Welles was accused of trademark infringement and trademark dilution in her use of Playboy's trademarked terms in the metatags of her website.

1-800 Contacts Inc. is an American contact lens retailer based in Draper, Utah. The brands that 1-800 Contacts use includes Johnson & Johnson Vision Care, Alcon, Bausch & Lomb and CooperVision. In 2006, its last year as a public company, the company reported net sales of US$247 million.

In the United States, trademark law includes a fair use defense, sometimes called "trademark fair use" to distinguish it from the better-known fair use doctrine in copyright. Fair use of trademarks is more limited than that which exists in the context of copyright.

People for the Ethical Treatment of Animals v. Doughney, 263 F.3d 359, was an important Internet domain trademark infringement decision by the United States Court of Appeals for the Fourth Circuit.

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<i>Planned Parenthood Federation of America, Inc. v. Bucci</i> American legal case

Planned Parenthood Federation of America, Inc. v. Bucci, 42 U.S.P.Q.2d 1430, an early Internet domain trademark infringement case heard in the United States District Court for the Southern District of New York, established the theory that hosting a site under a domain name that was the registered trademark of a third party constituted trademark infringement. The case was also important in determining what constitutes "Use in Commerce" under the Lanham Act in cyberspace. Although these holdings were modified and overruled by various American courts following the decision, Bucci stands as a seminal case for being one of the first cases to address these issues.

<i>Google, Inc. v. American Blind & Wallpaper Factory, Inc.</i>

Google, Inc. v. American Blind and Wallpaper Factory, Inc., No. 5:03-cv-05340, was a decision of the United States District Court for the Northern District of California that challenged the legality of Google's AdWords program. The court concluded that, pending the outcome of a jury trial, Google AdWords may be in violation of trademark law because it (1) allowed arbitrary advertisers to key their ads to American Blind's trademarks and (2) may confuse search-engine users initially interested in visiting American Blind's website into visiting its competitors' websites.

<i>Brookfield Communications, Inc. v. West Coast Entertainment Corp.</i>

The case Brookfield Communications, Inc. v. West Coast Entertainment Corporation, 174 F.3d 1036, heard by the United States Court of Appeals for the Ninth Circuit, established that trademark infringement could occur through the use of trademarked terms in the HTML metatags of web pages when initial interest confusion was likely to result.

Lamparello v. Falwell, 420 F.3d 309, was a legal case heard by the United States Court of Appeals for the Fourth Circuit concerning allegations of cybersquatting and trademark infringement. The dispute centered on the right to use the domain name fallwell.com, and provides discussion on cybersquatting as it applies to criticism of a trademark.

Playboy v. Netscape, 354 F.3d 1020 was a case regarding trademark infringement and trademark dilution decided by the United States Court of Appeals for the Ninth Circuit. Playboy Enterprises Inc. took legal action against Netscape Communications Corp. and Excite, Inc., accusing them of infringement and dilution of Playboy's marks "playboy" and "playmate".

Omega S.A. v. Costco Wholesale Corp., 541 F.3d 982, was a case decided by the Ninth Circuit Court of Appeals that held that in copyright law, the first-sale doctrine does not act as a defense to claims of infringing distribution and importation for unauthorized sale of authentic, imported watches that bore a design registered in the Copyright Office. It is contrasted with Kirtsaeng v. John Wiley & Sons, Inc.

Trademark infringement is a violation of the exclusive rights attached to a trademark without the authorization of the trademark owner or any licensees. Infringement may occur when one party, the "infringer", uses a trademark which is identical or confusingly similar to a trademark owned by another party, in relation to products or services which are identical or similar to the products or services which the registration covers. An owner of a trademark may commence civil legal proceedings against a party which infringes its registered trademark. In the United States, the Trademark Counterfeiting Act of 1984 criminalized the intentional trade in counterfeit goods and services.

<i>Network Automation, Inc. v. Advanced Systems Concepts, Inc.</i>

Network Automation, Inc. v. Advanced Systems Concepts, Inc., 638 F.3d 1137 was a court case decided on March 8, 2011, where the United States Court of Appeals for the Ninth Circuit ruled that the use of a competitor's trademark as an Internet search advertising keyword did not constitute trademark infringement. In the case, Network Automation advertised their own competing product in search queries that contained Advanced Systems Concepts' "ActiveBatch" trademark. In determining whether trademark infringement occurred, the court evaluated factors relevant to the likelihood of customer confusion outlined in AMF Inc. v. Sleekcraft Boats and concluded that confusion was unlikely.

Grotrian-Steinweg Company

Grotrian-Steinweg, known as Grotrian in the US, is a German manufacturer of prestige pianos. The company is based in Braunschweig, Germany, commonly known as Brunswick in English. Grotrian-Steinweg makes premium grand pianos and upright pianos.

Rosetta Stone v. Google, 676 F.3d 144, was a decision of the United States Court of Appeals for the Fourth Circuit that challenged the legality of Google's AdWords program. The Court overturned a grant of summary judgment for Google that had held Google AdWords was not a violation of trademark law.

References

  1. 1 2 3 Brookfield Communications Inc. v. West Coast Entertainment Corporation, 174 F.3d 1036 Archived 2009-09-29 at the Wayback Machine (9th Cir. 1999).
  2. 1 2 3 4 Rothman, Jennifer E., Initial Interest Confusion: Standing at the Crossroads of Trademark Law , 27 Cardozo Law Review 105 (2005).
  3. ↑ United States Court of Appeals, Second Circuit. "523 F.2d 1331: Grotrian, Helfferich, Schulz, Th. Steinweg Nachf., Plaintiff-appellant, v. Steinway & Sons, Defendant-appellee". Justia US Law. Retrieved February 14, 2012.(2d Cir. 1975)
  4. ↑ Grotrian, Helfferich, Schulz, Th. Steinweg Nachf. v. Steinway & Sons, 365 F. Supp. 707, 717 (S.D.N.Y. 1973).
  5. ↑ Mobil Oil Corp. v Pegasus Petroleum Corp., 818 F.2d 254 (2d Cir. 1987).
  6. 1 2 Playboy Enterprises, Inc. v. Netscape Communications Corp., 354 F.3d 1020 Archived 2010-05-17 at the Wayback Machine (9th Cir. 2004).
  7. ↑ Goldman, Eric, Deregulating Relevancy in Internet Trademark Law , 54 Emory Law Journal 559 (2005).
  8. ↑ Coleman, Ronald, De Minimis Confusion on the Internet: Compounding the Error of Initial Interest , 3 Journal of Internet Law (October 2003).
  9. ↑ Pink, Jonathan, Initial Interest Confusion Doctrine Archived 2005-08-11 at the Wayback Machine , IP Frontline (Jul. 6, 2005).
  10. ↑ Kravitz, Jason C., Initial Interest Confusion: Dispelling Some of the Confusion , Massachusetts Lawyers Weekly (Aug. 23, 2004).
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