• Trademark Infringement--The Eight Factors Courts Use To Decide
  • December 9, 2008 | Author: Galen Gentry
  • Law Firm: Gentry, Galen, A Professional Corporation, Law Offices of - Los Angeles Office
  • Trademark infringement claims are increasingly common. This article describes the eight factors courts use to determine whether one entity has infringed on the mark of another. U.S. trademark protection is granted to the first entity to use a particular mark in the geographic area where it operates, regardless of whether the mark is registered.

    Whether infringement has occurred hinges upon the likelihood of confusion by consumers of the trademarks at issue

    The U.S. Supreme Court has described the basic objectives of trademark law as follows: "trademark law, by preventing others from copying a source-identifying mark, 'reduce[s] the customer's costs of shopping and making purchasing decisions,' for it quickly and easily assures a potential customer that the item with trademark is made by the same producer as other similarly marked items that he or she liked in the past. At the same time, the law helps assure a producer that it (and not an imitating competitor) will reap the financial and reputation-related rewards associated with a desirable product." Qualitex Co. v. Jacobsen Products Co. Inc. (1995) 514 U.S. 159, 163-164, 115 S. Ct. 1300. 
    To establish a trademark infringement claim or an unfair competition claim a business must show that another entity is using a mark confusingly similar to a valid, protectable trademark
    Registering a trademark on the Principal Register in the Patent and Trademark Office constitutes prima facie evidence of the validity of the registered mark and of plaintiff's exclusive right to use the mark on the goods and services specified in the registration. A party can rebut the presumption that the registered trademark is valid and that registrant is entitled to exclusive use of mark by showing that it was the party which first used the mark, not the registrant. This is true because a fundamental tenet of trademark law is that ownership of an inherently distinctive mark is governed by priority of use. 
    Courts look to eight key factors for guidance in determining the likelihood of confusion
    In determining the likelihood of confusion in trademark infringement actions the courts look to these eight factors: the similarity of the conflicting designations; the relatedness or proximity of the two companies' products or services; strength of the plaintiff's mark; marketing channels used; the degree of care likely to be exercised by purchasers in selecting goods; the defendant's intent in selecting its mark; evidence of actual confusion; and the likelihood of expansion in product lines.

    Some factors are much more important than others, and the relative importance of each individual factor will be case-specific. Some of the factors relevant to determining the likelihood of confusion will always be important, such as the similarity of the marks and whether the two companies are direct competitors.  Where the two marks are entirely dissimilar, there is no likelihood of confusion. For example "Pepsi" does not infringe Coca-Cola's "Coke."
    Even in situations where a complainant's and an alleged infringer's mark are the same, there may be no consumer confusion and no trademark infringement if the alleged infringer is in a different geographic area or in a wholly different industry.  The more similar the marks in terms of appearance, sound, and meaning, the greater the likelihood of confusion. In analyzing this factor the marks must be considered in their entirety and as they appear in the marketplace with similarities weighed more heavily than differences. 

    A couple of interesting examples of identical marks without consumer confusion concern hot dogs and pizza. In the case of Weiner King, Inc. v. Wiener King Corp., the court permitted concurrent use of "Weiner King" as a mark for restaurants featuring hot dogs in New Jersey and "Wiener King" as a mark for restaurants in North Carolina. Similarly, in Pinocchio's Pizza Inc. v. Sandra Inc., the court permitted concurrent use of "PINOCCHIO'S" as a service mark for restaurants in Maryland and "PINOCCHIOS" as a service mark for restaurants elsewhere in the country.
    The courts have stated that their analysis of the eight factors is pliant, which means that there is no bright line test. This is problematic for business owners whose trademark has great value. Due to the absence of a bright line test trademark disputes can rarely be solved without consulting a lawyer. This is not to say that all trademark disputes must go to court. Often, the disputes can be resolved without litigation. Large companies zealously guard their trademarks. If your company receives a letter alleging you are infringing on the trademark of another entity you should not take what you read as determinative, but you should review the allegations with a lawyer immediately.