April 2013: Trademark Litigation Update

by Quinn Emanuel Urquhart & Sullivan, LLP

OSCAR Wins European Trademark Proceeding. On October 11, 2012, the Academy of Motion Picture Arts and Sciences won cancellation of an “Oscar Della Lirica” design mark from the Cancellation Division of the Office for Harmonization in the Internal Market (“OHIM”). The win is significant in that in Italy, where the offending mark was registered, the term “Oscar” can be used to refer to the Academy’s famous statuette or to any award of high distinction. Indeed, Italian dictionaries frequently provide both definitions for “Oscar.”

OHIM held that the defendant was both taking unfair advantage of, and engaging in activities detrimental to, the distinctive character of the Academy’s famous mark. OHIM rejected the defendant’s argument that its mark, consisting of the image of a statute of a winged woman holding a harp but labeled “Oscar Della Lirica” was actionably similar to the Academy’s one-word trademark.

The opinion declared broadly that the word “Oscar” indicates “in various languages of the European Union” the award annually conferred by the Academy. It further noted the “very high reputation” of the trademark throughout Europe and its world-wide reputation as a “symbol of quality and excellence in the field of the motion picture industry.” It added that the defendant’s mark “cannot have the same allure of the award ceremony in Los Angeles,” thus harming the “Oscar’s” reputation and commercial value.

The Cancellation Division thus ordered the registration of the defendant’s mark cancelled and awarded costs to the Academy. See Academy of Motion Picture Arts and Sciences v. Blanc Enterprise S.R.L., OHIM Ref. No. 5831C.

John B. Quinn, Managing Partner of Quinn Emanuel, is General Counsel of the Academy of Motion Picture Arts and Sciences.

Amazon Wins Summary Judgment in Internet Search Results Trademark Dispute. Continuing a trend away from rigid application of the Sleekcraft likelihood of confusion factors in the internet context, the Central District of California recently granted summary judgment for Amazon.com and Amazon Services LLC (collectively, “Amazon”) in a trademark infringement case relating to Amazon’s product search results. Multi Time Machine, Inc. v. Amazon.com Case No. 2:11-cv-09076-DDP-MAN, 2013 WL 638888 (C.D. Cal. Feb. 20, 2013). In considering whether Amazon’s search results pages for searches for “MTM Special Ops” watches infringed Multi Time Machine’s trademark where no MTM Special Ops watches were available from Amazon and only listings for competitor watches were displayed, the court applied the context-specific framework for evaluating competitors’ internet search advertising that the Ninth Circuit articulated in Network Automation, Inc. v. Advanced Systems Concepts, Inc., 638 F.3d 1137 (9th Cir. 2011). Focusing heavily on the context of search results and the clarity of labeling, the court concluded that “there is no likelihood of confusion in Amazon’s use of MTM’s trademarks in its search engine or display of search results.” 2013 WL 638888 *9.

Invoking Judge Berzon’s concurrence in Playboy Enterprises, Inc. v. Netscape Communications Corp., 354 F.3d 1020, 1035 (9th Cir. 2004), which posited a hypothetical about Macy’s display of its own Charter Club clothing near Calvin Klein merchandise and how that brick-and-mortar example may translate to the internet, the MTM court explained: “This case squarely presents the issue posed by Judge Berzon’s final question: If I search for one of MTM’s trademarks, such as ‘mtm special ops,’ is Amazon infringing when it presents me with a list of watches from MTM’s competitors?” 2013 WL 638888 *3. MTM argued that Amazon did infringe, analogizing Amazon’s display of competitor search results in response to search queries for MTM’s product to a restaurant serving glasses of Pepsi to customers who requested Coke, which the Ninth Circuit held to be unlawful passing off in Coca-Cola v. Overland, Inc., 692 F.2d 1250 (9th Cir. 1982). 2013 WL 638888 *4 n.4. But the court rejected MTM’s attempt to use the broad contours of that holding to exempt its claim from the likelihood of confusion standard. Id. The court reasoned that the more appropriate analogy was to “a consumer asking for a Coca-Cola and receiving a tray with unopened, labeled, authentic cans of Pepsi-Cola, RC Cola, Blue Sky Cola, Dr. Pepper, and Sprecher Root Beer, and a copy of Coca Kola: The Baddest Chick, by Nisa Santiago.” Id. The court explained that “[t]his is a substitution, but given the context it is not infringing because it is not likely to confuse.” Id. Evaluating the context of Amazon’s presentation of competitor’s products, the court likewise concluded that no confusion was likely.

The court determined that a number of Sleekcraft factors were not useful in its analysis. It concluded that the “proximity of the goods” factor could not favor the plaintiff even if the goods were in direct competition when, as here, the goods are presented as clearly marked options. Id. at * 5. Likewise, the “intent to confuse” factor was relevant “only insofar as it bolsters a finding that the use of the trademark serves to mislead consumers rather than truthfully inform them of their choice of products” (id. at *6 (quoting Network Automation, 638 F.3d at 1153))—a finding that “the clarity of labeling” (id. at *6) rebuts. In evaluating the “similarity of the marks” factor, the court similarly reasoned: “The issue is not whether the marks are identical but whether consumers are likely to be confused as to the source of the goods returned in the search results. Therefore, this factor is not independently relevant.” Id. And the court found the “marketing channels” factor wholly irrelevant. Id. (“The fact that Amazon and MTM are both selling watches on the Internet is too commonplace to affect the likelihood of confusion analysis.”). Based on the court’s reasoning, in any trademark infringement case involving clearly labeled search results, none of these factors is available to tip the scales toward a finding of infringement.

The court then evaluated the remaining Sleekcraft factors—strength of the mark, actual confusion, and degree of care and type of goods—in light of the record evidence. It concluded that they all favored Amazon, as did the critical inquiry of labeling and context. The court explained that while MTM’s expert testimony that Amazon’s search results are “ambiguous, misleading, and confusing,” did suggest “consumers may be confused about why they are receiving certain search results,” his study failed to test the relevant legal question of “whether users of Amazon are likely to be confused as to source.” Id. at *9.

Overall, the court’s analysis clarifies why confusion is unlikely in search results cases and sets a high bar for future plaintiffs to survive summary judgment.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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