Close call for Amazon: saved by the grace of US Court of Appeals

ecommerce-concept-shopping-cart-52722007In a rare move, the US Court of Appeals at San Francisco in Multi-Time Machine Inc. vs. Amazon Inc.[1] reversed its own opinion and said that the lower court correctly found in Amazon.com’s favor. Multi-Time Machine, Inc. (MTM) manufacturer of MTM ‘Special Ops’ watches alleged that Amazon, the e-commerce giant infringed its trademark because of the manner in which the website responded to the customer’s search request for the watches. MTM sought injunctive relief barring use of the trademark and damages.

MTM manufactures and markets watches under various names, including ‘MTM’, ‘MTM Special Ops’, and ‘MTM Military Ops’. It holds a registered trademark in ‘MTM Special Ops’ for timepieces. In order to cultivate and maintain an image as a high-end, exclusive brand, MTM did not authorize its distributors/retailers to sell the watches on Amazon or any other e-commerce portal. It was contended by them that Amazon customers who search for ‘MTM Special Ops’ on the website are first routed to a page which shows the phrase “MTM Special Ops” in the search field; then immediately below as “MTM Special Ops” directly below the search line; and lastly with the words “Related Searches.” After the three iterations of MTM’s trademark the screen lists search results of watches manufactured by MTM’s competitors. MTM contends that Amazon’s search results creates likelihood of confusion and thus could cause customers to buy a competitor’s watch, rather than encouraging them to look for MTM watches elsewhere. Moreover, the ‘initial interest confusion’[2] was relied on by MTM stating that confusion might occur because Amazon lists the search term used – the trademarked phrase “MTM Special Ops” – three times on the search page. Since Amazon lists the search term “MTM Special ops” at the top of the page, a consumer might conclude that the products displayed are types of MTM watches or that the said labels are in any way connected to MTM.

The Court after reviewing the Amazon’s search results page declared that in the present case, the confusion is not caused by the design of the competitor’s mark, but by the design of the web page that is displaying the competing marks and offering the competing products for sale, which does not qualify as “likelihood of confusion”. Additionally, the customers cannot purchase the watches from the search results page, but must navigate to the “product detail” page by clicking on a particular search result. Once the customer has clicked on a particular result, he will see the particular product’s brand name and the product title, which also shows the brand name (e.g., Luminox).[3] Since Amazon’s search results page clearly labels the name and manufacturer of each product offered for sale and even includes photographs of the items, no reasonably prudent consumer accustomed to shopping online would likely be confused as to the source of the products. Amazon is merely responding to a customer’s inquiry about a brand it does not carry by doing no more than stating clearly of what brands it does carry.

 

[1] Case No. 13-55575

[2] It is a doctrine which has been (used in the US trademark cases), which allows for a finding of liability where a plaintiff can demonstrate that a consumer was confused by a defendant’s conduct at the time of interest in a product or service, even if that initial confusion is corrected by the time of purchase

[3] Judgement of the case available at < http://cdn.ca9.uscourts.gov/datastore/opinions/2015/07/06/13-55575.pdf>

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