The doctrine of “initial interest confusion,” scorned by many legal
commentators and rejected by numerous courts, is alive and well in the Ninth Circuit, as evidenced by its recent usage by a watch manufacturer to overcome a
summary judgment motion by online retailer Amazon. The initial interest
confusion doctrine holds that a defendant can be deemed liable where a
plaintiff can demonstrate that consumers are likely to be confused by a
defendant’s conduct at the time of the consumers’ initial interest in a product
or service, even if that initial confusion is corrected prior to an actual
purchase. The doctrine is prevalent in so-called “keywords” cases in which one
company pays the proprietor of an Internet search engine (e.g., Google) to
prominently display the paying company’s website(s) in Internet searches
conducted by consumers that include keywords such as a competitor’s company
name or products. Alternatively, in the present case, the proprietor of the
searchable website uses particular keywords associated with one company or
product to drive consumer traffic to a similar product offering.
In Multi
Time Machine, Inc. v. Amazon.com, Inc., Multi-Time Machines, Inc. (MTM) sells high-end, military style watches
under its MTM Special Ops brand. Amazon does not sell MTM Special Ops watches
through its online retail platform but, MTM argues, Amazon uses the MTM Special
Ops mark to mislead would-be MTM Special Ops consumers seeking to purchase such
a watch via Amazon’s website. When one enters “MTM Special Ops” in the Amazon site search box, the user is directed to a results page that indicates “MTM Special Ops” in
the search box, the phrase “MTM
Special Ops” again in quotations beneath the search box, and the wording
“Related Searches: mtm special ops watch.” The products listed among the
results are watches with similar functionality sold by MTM’s competitors, such
as Luminox. When a user clicks on one of the results he is presented with a web page describing
that product, but that still
includes the words “MTM Special Ops” in the search box at the top of the page.
MTM brought suit before the U.S. District Court for the Central District
of California claiming that Amazon’s presentation of competitive products under
the above circumstances is likely to cause confusion that the competitors
listed in the Amazon search results are affiliated with MTM, and that confused
consumers would click on the links to competitive product summaries and
ultimately purchase a competitive product, thus diverting sales from MTM. The
district court rejected MTM’s position, granting Amazon’s summary judgment
motion. MTM then appealed to the Court of Appeals for the Ninth Circuit.
The Court of Appeals acknowledged that the competitive product search
results wording was not confusing, but disagreed with the lower court’s
determination that a jury would not reasonably find likelihood of confusion
when considering the totality of the circumstances when viewed in a light most
favorable to non-moving party MTM. The Court of Appeals was clearly influenced
by the fact that Amazon might—but does not—easily dispel confusion by
indicating at the top of the search results a statement that it does not carry
the sought after goods, as do similar retailers Buy.com (now
Rakuten.com) and Overstock.com.
The dissenting opinion bluntly stated, “[i]t is possible that some dolt
somewhere might be confused by the search results page,” but pointed out that
the Ninth Circuit standard for consumer sophistication for keyword-type cases,
set forth by the Network
Automation decision, holds
that “[u]nreasonable, imprudent and inexperienced web-shoppers are not
relevant.”
In this author’s view, the reasoning in the dissenting opinion should
have carried the day. The initial interest confusion doctrine seeks to remedy
harm that is something other than trademark infringement, a type of harm that
should be redressed, if at all, under some species of unfair competition law. To
the extent that the initial confusion doctrine continues to be recognized in
some corners as an actionable subset of likelihood of confusion, it needs to be
applied in a way that recognizes that typical online consumers are not easily
duped.
Certainly a takeaway from this decision for an online retailer—even one
that does not agree with the application of the initial interest confusion
doctrine in this decision—is that the prudent approach to use where consumers
search for products that it does not carry or does not have in stock would be
to post an explicit message to that effect, which can be accompanied by
listings of alternative products.
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