In PlayNation Play Systems, Inc. v. Velex Corp., 2019 WL 2180589 (11th Cir. May 21, 2019), the Eleventh Circuit considered whether the district court erred in determining that the defendant infringed the plaintiff’s trademark and in awarding damages in the form of the defendant’s profits and cancellation of the defendant’s trademark. Plaintiff sold children’s outdoor play equipment, and defendant sold doorway pull-up bars. Both parties had registered trademarks that depicted gorillas and used the word “Gorilla.”
To determine whether the defendant’s mark was likely to cause consumer confusion and, thus, whether the defendant infringed the plaintiff’s mark, the Eleventh Circuit considered the relevant factors.
Strength of the Mark—The court concluded that the district court did not clearly err in determining that the plaintiff’s mark was strong. The mark was suggestive and extensively used by the plaintiff in commerce since 2002. Additionally, the mark was incontestable and not widely used by third parties. The Eleventh Circuit rejected the defendant’s argument that the plaintiff’s mark was weak because 30 other registered marks in the same class used the word “gorilla,” since none of those marks were used on similar products.
Actual Confusion—The court agreed with the lower court that the actual confusion factor weighed in the plaintiff’s favor. The plaintiff had produced two individuals who purchased its product but contacted the defendant for customer support. Further, consumers had asked online whether the plaintiff’s accessory products could be used with the defendant’s product. The court disagreed with the defendant’s position that this evidence was insufficient because the consumers would not have been confused if they had diligently researched the products, explaining that actual confusion is measured against a reasonably prudent consumer standard, not the most careful consumer.
Similarity of the Marks—Likewise, the similarity of the marks weighed in the plaintiff’s favor. Although the marks used different colors and fonts, they depicted similar types and sizes of gorillas and used almost indistinguishable words next to the gorilla.
Similarity of Products, Retail Outlets, and Advertising—These factors also weighed in favor of a likelihood of consumer confusion because the products were highly similar, sold at similar retail outlets, and advertised in similar ways.
In addition, the defendant argued that two other factors should be considered: (1) the defendant had a valid federal trademark registration, and (2) the plaintiff failed to produce survey evidence suggesting consumer confusion. The court agreed with the district court’s rejection of these factors. First, the fact that the defendant’s trademark was registered did not preclude the trademark infringement action. Issue preclusion was inapplicable, as the parties had not previously adjudicated the similarity of the marks. Second, in light of the Circuit’s shift away from survey evidence, the lack of survey evidence was a nonstarter.
The court next considered whether it was appropriate for the lower court to cancel the defendant’s trademark and award the plaintiff damages in the form of the defendant’s profits. The Eleventh Circuit upheld the cancellation of the defendant’s trademark but vacated the award of defendant’s profits. This award had followed from the district court’s determination that the defendant willfully infringed by continuing to use its own mark after it was served with the plaintiff’s complaint. This logic, the Eleventh Circuit reasoned, would put a valid trademark holder at risk of losing all of its profits for failing to immediately cease selling the trademarked product after receiving a complaint alleging infringement, regardless of the trademark holder’s intent. Notably, the lower court had found that the defendant did not intend to infringe the plaintiff’s mark. Consequently, the court vacated the district court’s award of profits based on willful infringement and remanded the case for the lower court to consider whether any other evidence demonstrated the defendant’s willfulness and supported an award of the defendant’s profits.
Posted by Kamryn Deegan.