No confusion possible if customer cannot see product, says court

In Custom Manufacturing & Engineering Inc v Midway Services Inc (Case 05-12906, November 21 2007), the US Court of Appeals for the Eleventh Circuit has affirmed a summary judgment ruling that there is no likelihood of confusion where the product on which a mark is affixed cannot be seen by customers.

Custom Manufacturing & Engineering Inc had agreed to design for Midway Services Inc a water-meter reading system to be installed in residential complexes. However, Midway cancelled the contract on the grounds that Custom had breached it and hired a competitor to finish the job. In the midst of litigating the resulting breach of contract action, Custom alleged:

The goods on which Custom's mark was affixed were subcomponents (circuit boards) manufactured for use in a product that was marketed to apartment complex owners and managers, but not to Custom's customers. The district court affirmed summary judgment for the defendant and Custom appealed.

The Court of Appeals for the Eleventh Circuit stated that the issue in this case was whether there was a likelihood of confusion in the post-sale context - namely, whether Custom's or Midway's potential customers were likely to be confused as to the origin of the circuit boards. The court noted that a likelihood of confusion analysis entailed more than the mechanistic summation of the number of factors on each side; it involved an evaluation of the "overall balance".

The court held that it was unlikely that the apartment owners and managers to whom Midway sold the water-meter reading systems would remove the covers and examine the circuit boards contained therein. The court also found that third parties, such as repairmen and firemen, are not properly considered as 'customers' under the Lanham Act. Even if the court had accepted as true that such persons were customers, Custom presented no evidence of a likelihood of confusion. The court stated that recovery under the Lanham Act requires, at a minimum, that "confusion, mistake or deception be likely, not merely possible". The court went on to state that:

"[l]ike the proverbial tree falling in a forest, the unauthorized use of a trademark that is never perceived by anyone cannot be said to create a likelihood of consumer confusion."

This case stands for the proposition that trademark plaintiffs must identify the relevant customers of their products and provide evidence in the record from such customers to prove a likelihood of confusion.

Jeremy T Elman, McDermott Will & Emery, Miami

Unlock unlimited access to all WTR content