Importance of actual confusion among relevant customers highlighted

United States of America

In Caliber Automotive Liquidators Inc v Premier Chrysler Jeep Dodge LLC (Case 08-16179, May 7 2010), the US Court of Appeals for the Eleventh Circuit has remanded for trial a finding of summary judgment in favour of the defendant that infomercials called 'Slasher Shows' were not confusingly similar to the registered trademarks SLASH-IT! SALES EVENT or SLASHER SALE.

Caliber Automotive Liquidators Inc provides services to car dealerships in the form of sales events. Caliber's staff arrives at the dealership prior to the event, posts advertising and motivates the sales people. During the event, the sales people "histrionically slash the car prices and seal the deal". The defendants ran infomercials called 'Slasher Shows', featuring a Slasher Man, a Slasher Countdown and off-camera voices shouting "Slash it!". Caliber sued for trademark infringement.

The district court granted summary judgment to the defendants, finding that, despite the fact that Caliber's car dealership customers were confused, the defendant's retail customers were not. Therefore, no reasonable jury could find a likelihood of confusion between Caliber's marks and the defendants' services.

Caliber appealed on the basis that there was a likelihood of confusion. The district court had acknowledged actual confusion, but had devalued it because the Slasher Show did not confuse the defendants' retail customers. Caliber also maintained that the district court had understated the strength of its marks. In briefing, all parties conceded that actual confusion was the "most weighty consideration". Caliber focused on the confusion among its customers.

The Eleventh Circuit found that the district court had erred in its analysis. First, the "quantum of evidence needed to show actual confusion is relatively small", such that the district court should not have overvalued the lack of confusion by the general public. Second, since Caliber's marks had incontestable status, they were presumptively strong, because incontestable marks are presumed to have secondary meaning.

Evaluating the remaining confusion factors, the Eleventh Circuit found that the SLASHER marks of both parties created the same impression. The similarity of Caliber's and the defendant's trade channels (retail outlets and customers) was such that a reasonable consumer could attribute the products to the same source. The court also noted that Caliber had failed to show that the defendants had adopted a SLASHER mark with an intent to trade on Caliber's reputation. However, weighing the factors as a whole, the court deemed Caliber to have "presented sufficient evidence of the strength of its marks and of actual confusion amongst the relevant customers to avoid summary judgment".

Michael J Keller, McDermott Will & Emery LLP, Miami

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