Likelihood of Confusion
Trademark likelihood of confusion is the touchstone issue for questions of infringement under U.S. Trademark Law. The is often called the likelihood of confusion test.
Likelihood of Confusion Factors
The two most important factors in determining a likelihood of confusion are:
- the similarity of the trademarks; and
- the similarity of the goods and services.
Evidence of actual confusion between two trademarks can be difficult to prove, so the plaintiff in a trademark infringement case will only need to show there is a likelihood of confusion, not actual confusion.
However, there is no one-size-fits-all approach to testing for a likelihood of confusion because the nature of trademarks, which can consist of words, phrases, images, jingles, and colors, makes that difficult. Because there is no mechanical formula or litmus test, courts look at a number of factors to determine the existence of a likelihood of confusion between the two trademarks.
Trademark Likelihood of Confusion Arguments
DuPont Factors
In In re E.I. du Pont de Nemours & Co., 476 F.2d 1357 (CCPA 1973), the US Court of Customs and Patent Appeals listed 13 factors to consider when determining whether or not there is a likelihood of confusion between two trademarks. This list examines various commercial elements of two competing trademarks in completing this analysis.
The 13 DuPont factors are:
- The similarity of the trademarks as to overall appearance, sound, and commercial impression
- The similarity and nature of the goods or services at issue
- The similarity of established trade channels
- The conditions under which sales are made and the buyers to whom sales are made – are the buyers typically impulse shoppers, or are the goods or services only purchased after careful research and deliberation?
- How famous the first trademark is, including advertising expenditures incurred by the plaintiff
- The number and nature of similar trademarks in use on similar goods or services
- The nature and extent of any actual confusion by the consuming public
- The length of time for the concurrent use, and the conditions under which there has been concurrent use without evidence of actual confusion
- The variety of goods and services on which a trademark is used
- The market interface between the owners of the two trademarks, such as agreements between the parties regarding limitations on using them
- The extent to which the parties have a right to exclude others from using the trademark
- The extent of potential confusion, by the consuming public
- Any other established fact probative of the effect of use
For more information on these factors, please see our page about the Dupont Factors.
The Trademark Trial and Appeal Board, as well as the Federal Circuit will utilize DuPont when examining the existence of a likelihood of confusion.
Sleekcraft Factors
Although DuPont is the standard the Trademark Trial and Appeal Board uses when determining whether a likelihood of confusion exists between two trademarks, courts in other jurisdictions apply different tests when examining this question.
In the Ninth Circuit, which includes California, Oregon, Washington State, Nevada, Montana, Idaho, Hawaii, and Alaska, courts apply factors laid out in AMF, Inc. v. Sleekcraft Boats which are called the Sleekcraft factors. The Federal Circuit will also apply these factors for cases arising from the Ninth Circuit if it does not have exclusive jurisdiction
The eight Sleekcraft factors are:
- Strength of the trademark (fanciful, arbitrary, suggestive, or merely descriptive);
- Proximity of the goods and services, both in geographic location and use;
- Similarity of the trademarks when considering sight, sound, and meaning;
- Evidence of actual confusion;
- Marketing channels used;
- Type of goods or services and the degree of care likely to be exercised by the purchaser;
- Defendant’s intent in selecting the trademark; and
- Likelihood of expansion of the product lines.
For more information, please see our page about the Sleekcraft Factors.
As with DuPont, the number of factors allows courts to be flexible when analyzing the existence of a likelihood of confusion between trademarks. The Sleekcraft court recognized that other factors may come into play when analyzing this question, depending on the facts of the case. Unlike DuPont cases, the eight Sleekcraft factors should each be reviewed in trademark infringement cases.
When considering the Sleekcraft factors, California courts will determine if individual factors favor the plaintiff’s position, the defendant’s position, or if the factor does not favor one side over the other.
Each of the 13 US Circuit Courts has its own test for determining whether a likelihood of confusion exists between two trademarks. Many of the factors overlap, and each test gives room for consideration of additional factors as appropriate.
Trademark Cease and Desist Letter
If you discover that someone is infringing on your trademark, the first step is typically sending a trademark cease and desist letter.
Cease and desist letters are an important tool for trademark owners, who are required to police their trademarks or risk losing exclusivity over them. Cease and desist letters are also useful for resolving matters faster and at a lower cost for both parties than litigation. Cease and desist letters are often used as a way for a brand to maintain its goodwill in the community at large.
If the other party fails to comply with your cease and desist letter, its noncompliance may be evidence of willful infringement, which can result in higher monetary damages in a trademark lawsuit.
Trademark Infringement Elements
To establish trademark infringement, a plaintiff must prove three elements:
- A valid and legally protectible trademark
- Ownership of the trademark; and
- That the defendant’s use causes a likelihood of confusion.
The best way to meet the first element is to present the trademark registration certificate to demonstrate the existence and protectability of the trademark. Although there are certain common law trademark rights, the greatest source of protection comes from registering the trademark with the US Trademark Office. If the trademark is registered, the owner will only need to include the registration certificate with a complaint, which will include the date the trademark was first used in commerce.
This date is important because the plaintiff must demonstrate that its trademark was used in commerce prior to the defendant’s trademark. If the trademark is registered with the Trademark Office, the plaintiff can point to the registration materials as evidence of the first use date.
If the plaintiff is not the named owner of the trademark, the plaintiff will also need to demonstrate its interest in the trademark by presenting evidence that the owner has given the plaintiff authority to proceed with the trademark litigation.
Next, the plaintiff must demonstrate that the defendant is using a confusingly similar trademark in a way that there will be a likelihood of confusion and/or deception among the consuming public. Courts will look at the factors discussed above when determining whether a likelihood of confusion exists between the two trademarks.
Trademark Infringement Damages
Plaintiffs in trademark cases must prove damages to obtain monetary relief. A court may base its award on one of three calculations:
- The defendant’s profits from the infringing activity
- The plaintiff’s monetary losses due to the infringing activity
- Reasonable royalties, had the defendant properly licensed the trademark
In cases involving counterfeit trademarks, the plaintiff may seek statutory damages, which can range from $500 to $100,000 per type of good or service sold, and for willful counterfeiting activity, may receive treble damages up to $1 million per counterfeit trademark.
In addition, the plaintiff may also seek reimbursement for:
- Costs incurred for “corrective advertising” to re-educate the public as to the source indicator of the trademarks
- Costs of the lawsuit
- Attorney’s fees in exceptional cases
Frequently a plaintiff’s primary concern in a trademark infringement case is equitable relief in the form of an trademark injunction, granted at the outset of litigation, and permanent injunctions, granted as part of the court’s final order.
In order to obtain a preliminary injunction, the plaintiff must show:
- It is likely to succeed on the merits of the case
- It is likely to suffer irreparable harm if preliminary relief is not granted
- The balance of harms is in its favor
- An injunction is in the public interest
Obtaining a preliminary injunction at the outset of litigation has the immediate effect of stopping the infringing activity to prevent further harm to the plaintiff’s goodwill during the pendency of the court case. Similarly, in order to obtain a permanent injunction, a plaintiff must demonstrate:
- It has suffered irreparable harm
- Monetary damages are inadequate to compensate for this injury
- The balance of hardships is in favor of the injunction
- The injunction is in the public interest
Trademark infringers who violate preliminary and permanent infringement injunctions may be subject to further damage because such a violation is indicative of intentional actions.
Trademark Infringement Defenses
A defendant in a trademark infringement case can raise a number of affirmative defenses.
Fair Use
Under the fair use defense, a defendant may use an otherwise protected term if that term is a descriptive term for its goods or services. Apple cannot prohibit farmers from using its trademarked name to describe their fruit.
Comparisons to Own Product
Comparative use is also a permissible use of an otherwise protected name, if a company is comparing its product to another in the same class of goods or services. For example, it is common for stores to compare their in-house branded products to the similar name brand product.
Commentary, Criticism, and Parody
A defendant can also claim its use of the trademark was for news commentary, criticism, or parody, where a similar trademark was used to mock the original trademark. Although this defense is rooted in First Amendment free speech provisions, parody exists as a defense even in commercial cases where free speech claims do not apply.
Statute of Limitations
In addition to trademark-specific defenses to an infringement claim, a defendant can raise defenses applicable to any litigation. A common argument is that the plaintiff failed to bring the lawsuit within the applicable statute of limitations. There is no federal trademark statute of limitations in the Lanham Act, so courts look to the relevant state statute of limitations.
A typical stature of limitations for trademark infringement is four years. If the plaintiff fails to bring a lawsuit within four years of the commencement of the infringing activity, it may be barred from recovery.
Laches
Similar to the statute of limitations defense, the doctrine of laches is an affirmative defense arguing:
- The plaintiff took unreasonable delay in bringing the case
- The plaintiff’s unreasonable delay caused harm to the defendant
The doctrine of laches is an equitable defense, which is appropriate in trademark infringement cases in which equitable relief found by injunctions is common.
Estoppel
Estoppel is another type of equitable relief available to defendants in trademark infringement cases. There are three elements to this defense:
- The plaintiff engaged in activity that led the defendant to reasonably believe the plaintiff would not bring a lawsuit
- The defendant relied upon its reasonable belief
- The defendant suffered injury due to the plaintiff’s action
This defense may be raised in cases in which the plaintiff indicated it would not pursue infringement claims against the defendant, yet did so anyway.
Unclean Hands
This defense can be raised in cases in which a plaintiff would otherwise be entitled to relief, but acted so badly including during the lawsuit that the public interest in punishing the plaintiff’s behavior outweighs the plaintiff’s rights to recovery.
The unclean hands defense pops up when the plaintiff abused the discovery process by engaging in unreasonable delay, submitting numerous motions made in bad faith to the court, failing to submit required documents, or outright lying in its filings.
Invalidating the Trademark
In addition to raising affirmative defenses, the defendant can go on the offensive by filing a trademark cancellation against plaintiff’s trademark. Trademarks must be used in commerce, so a plaintiff cannot privately “sit” on the trademark and at the same time prohibit others from using it.
Moreover, trade dress, which represents a subset of trademarks, cannot be functional. If the defendant successfully argues that the trade dress is functional, the protections may be invalidated, effectively dismissing the trademark infringement claims.
Contact Us
If you have a trademark infringement issue and would like assistance, please feel free to contact us.
