Likelihood of Confusion and Reverse Confusion
In trademark law, the most common claim to protect a trademark is a claim of likelihood of confusion. Under the Lanham Act of 1946, Section 43(a) provides trademark holders the right to file suit against parties that use marks that are “likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person.” Basically, likelihood of confusion occurs when consumers confuse a smaller, inferior mark with that of a more well known, superior mark. The factors used to determine if there has been a likelihood of confusion were first outlined in Polaroid Corp. v. Polaroid Elect. Corp. The first Polaroid factor considered is the theoretical and market strength of the plaintiff’s mark. The theoretical strength is how distinctive the mark is at face value and the market strength of the mark is the amount that consumers identify the mark with the plaintiff’s goods through advertising and third party use. The second Polaroid factor is the degree of similarity between the plaintiff’s and defendant’s marks. Courts will compare the visual and audio characteristics of the mark as well as the meaning behind both marks. The third Polaroid factor is the proximity of goods and services, which is how close the goods are found in a store, and the fourth factor is the likelihood that the plaintiff will bridge the gap between the marks. The fifth factor of evidence of actual confusion includes consumer feedback and studies on the level of confusion between the marks. The sixth factor looks at the defendant’s good faith in adopting their mark, which is determined based on inferring from the defendant’s knowledge of the plaintiff’s mark at the time of adopting their own mark. The seventh Polaroid factor of the quality of the defendant’s product or service is examined to see if there’s a sufficient similarity in the quality of the products or services between plaintiff and defendant as to cause confusion among consumers. Lastly, the courts will consider the level of sophistication of the targeted consumers. The more sophisticated the consumers of that product type are, the less likely there will be confusion between the plaintiff’s and defendant’s products. Each court of the federal circuit uses some form of the Polaroid factors with only a couple of changes (i.e. the 8th circuit separates proximity of goods and services from proximity of commercial channels).
In E&J Gallo Winery v. Consorzio del Gallo Nero, the largest winery in the US filed suit against Gallo Nero, an Italian trade association based on Florence, Italy. At issue was the likelihood of confusion between E&J Gallo’s wines and Gallo Nero’s Chianti Classico wine. Gallo Nero’s Chianti was sold with a black rooster on the label, which is gallo nero in Italian. The court found a likelihood of confusion based on the strength of the plaintiff’s mark, the similarity of the marks (they both used Gallo), the similarity in class of goods and marketing channels, a Lavidge survey demonstrating consumer confusion, and the defendant’s lack of good faith based on the defendant’s knowledge of the plaintiff’s mark. Although Gallo Nero provided a competing survey, their survey was conducted using a side by side comparison, which is irrelevant to likelihood of confusion since the products should have each been shown alone.
Reverse confusion can also occur, where a larger, stronger company adopts the mark of a smaller, weaker entity and causes confusion as to the origin of the mark. Such is the case in Dreamwerks Production, Inc. v. SKG Studio. The plaintiff held Dreamwerks conventions and filed suit against SKG Studio for concerns that their conventions would seem to be sponsored by Dreamworks. The key question is whether the senior user’s audience, the attendees of the convention, would think the convention is sponsored by Dreamworks. The court held that there was a strong likelihood of reverse confusion based on the arbitrariness of the mark, the similarity of sight, sound, and meaning of the marks, and the relatedness of the plaintiff’s and defendant’s goods.