Protecting Trademarks and the Likelihood of Confusion Factor
Published: February 6, 2015
A few years ago, I wrote a column addressing a case in which Pom Wonderful LLC sued Coca Cola Company in connection with the marketing of one of its pomegranate-blueberry juice products. That case dealt with whether one of Pom Wonderful’s claims were barred by the Federal Drug and Cosmetic Act with regard to labeling issues.
Ever protective of its brand, Pom Wonderful was recently successful before the Ninth Circuit in a trademark infringement case. Pom Wonderful sued a competing pomegranate beverage maker doing business under the name Pur Beverages for trademark infringement. After the district court denied Pom Wonderful’s motion for preliminary injunction barring the defendant from selling its competing beverage, Pom Wonderful appealed to the Ninth Circuit.
Pom Wonderful owns numerous trademark registrations that make up its “Pom” brand family. Pom Wonderful spends significant sums in marketing its products and policing against other companies’ uses that may infringe on its trademarks. In connection with these efforts, Pom Wonderful discovered that Pur was selling a pomegranate flavored energy drink that it called “Pŏm”. When Pur refused to change its marking, Pom Wonderful sued it for trademark infringement and moved for an injunction.
The Ninth Circuit concluded that the district court erred in denying Pom Wonderful’s motion for preliminary injunction. While a preliminary injunction is “an extraordinary and drastic remedy,” an injunction should issue where the moving party, such as Pom Wonderful, can establish that “(1) it is likely to succeed on the merits; (2) it is likely to suffer irreparable harm in the absence of preliminary relief; (3) the balance of equities tips in its favor; and (4) an injunction is in the public interest.” The primary issue facing the Ninth Circuit was whether the lower court had erred in determining that Pom Wonderful had not demonstrated the likelihood of success on the merits.
The Court began by recognizing that Pom Wonderful, to prevail on a claim of trademark infringement, would have to show that: “(1) it has a protected ownership interest in the `Pom’ mark; and (2) Pur’s use of the word ‘Pŏm’ is likely to cause consumer confusion thereby infringing upon Pom Wonderful’s rights.” The Court did not have to spend much time on the first factor because Pom Wonderful’s registration of its trademarks was “prima facie evidence of the validity of the mark”. This registration provided Pom Wonderful the “exclusive right to use the ‘Pom’ mark [and] covers all design variations of the word because ‘Pom’ was registered as a standard character mark,” i.e., a mark that makes no claim to any particular font, style, color or display size.
Turning to the issue of likelihood of consumer confusion, the Ninth Circuit stated that it had to use the factors from AMF, Inc. v. Sleekcraft Boats, 5999 F.2d 341 9th Cir. 1979) (“the Sleekcraft Factors”) in assessing the likelihood of consumer confusion. These factors are as follows: “(1) strength of the protected mark; (2) proximity and relatedness of the goods; (3) type of goods and the degree of consumer care; (4) similarity of the protected mark and the allegedly infringing mark; (5) marketing channel convergence; (6) evidence of actual consumer confusion; (7) defendant’s intent in selecting the allegedly infringing mark; and (8) likelihood of product expansion.” The Ninth Circuit turned to each of these factors in turn to determine that the lower court had erred.
Strength of the Protected Mark: The Ninth Circuit found that the lower court had correctly found that this factor favored Pom Wonderful. Although the mark “Pom” does not necessarily mean pomegranate by resorting to conventional dictionaries, it requires customers to use some additional imagination and perception to attribute the mark to Pom Wonderful’s goods. Given its substantial investment in its sales and marketing efforts, the Court held that “Pom Wonderful enjoys sufficient marketplace recognition to render its `Pom’ mark commercially strong.”
Relatedness of Goods: The Ninth Circuit found that the lower court had also correctly found that this second factor favored Pom Wonderful and that Pom Wonderful’s juice beverages were related to Pur’s “Pŏm” energy drink. This factor addresses “related goods … are those `which would be reasonably thought by the buying public to come from the same source if sold under the same mark’.” The Court concluded that a fruit juice beverage and a fruit flavored energy drink are sufficiently complimentary that a reasonable consumer would connect them.
Degree of Consumer Care: This was another factor that the Ninth Circuit concluded had been properly found by the lower court to be in Pom Wonderful’s favor. Given the nature of the beverage market whereby customers typically by single unit beverages at low cost, a “consumer [would] exercise a low degree of care and sophistication” in making such purchases
Similarity of Marks: Here, the Ninth Circuit found that the lower court erred in concluding that there was not a similarity of marks. The Ninth Circuit compared the product labeling and noted that they had “many obvious visual similarities,” including each containing three letters with a stylized second letter. The Ninth Circuit further went beyond the mere look of the labeling and found that because the marks were pronounced in precisely the same manner, “the marks are aurally identical.” Finally, the Ninth Circuit concluded that the two marks had the same meaning in that they both referred to pomegranate flavoring and/or ingredients. Given the visual, aural and semantic similarities, and having to weigh similarities more heavily than dissimilarities between the marks, the Ninth Circuit concluded that the lower court erred in not finding the marks to be similar for purposes of the injunction motion.
Marketing Channel Convergence: The Ninth Circuit concluded that the lower court again erred in concluding that this factor did not favor Pom Wonderful. This factor concerns “whether the parties’ customer basis overlap” and “how the parties advertise and market their products.” The Ninth Circuit concluded that Pom Wonderful would likely be able to establish that “both companies use parallel market channels” and that they both sell their products through supermarkets throughout the country, with at least one overlapping state and one overlapping supermarket chain. The Ninth Circuit also concluded that both products were similar in that they were “inexpensive and marketed to health conscience consumers.” Therefore, the Ninth Circuit held that this factor should have been weighed in Pom Wonderful’s favor.
Turning to the three remaining factors: actual confusion, defendant’s intent and product expansion, the Court held that the record before the lower court indicated that these factors did not favor one side or the other. Thus, in looking at the totality of the circumstances, the Ninth Circuit found that five of the Sleekcraft factors favored Pom Wonderful and the other three were neutral. Thus, the Ninth Circuit held that the lower court erred in not finding that Pom Wonderful had established the likelihood of success on the merits to warrant injunctive relief. The Ninth Circuit remanded the case back to the lower court to consider whether Pom Wonderful had established the other factors necessary for injunctive relief in light of its ruling.