TIRES PLUS infringement claim repaired in Tenth Circuit

In Team Tires Plus Ltd v Tires Plus Inc, the US Court of Appeals for the Tenth Circuit has ruled that the lower court had erred in reasoning that a defendant cannot infringe a plaintiff's trademark if it uses an allegedly infringing mark on goods that do not directly compete with the plaintiff's goods.

Team Tires Plus Ltd (TTPL) has owned the federally registered TIRES PLUS trademark since 1983 for "rendering technical assistance in the establishment of automobile tyre stores and automobile maintenance centres". Under the TIRES PLUS mark, TTPL offered automobile tyre and maintenance centre franchises. Based on its trademark registration and use, TTPL sued Tires Plus Inc (TPI) for operating a store in New Mexico for the sale of tyres using the Tires Plus name. Surprisingly, the district court granted a motion for summary judgment to dismiss TTPL's trademark infringement and unfair competition claims because a "competing use" was not established. TTPL appealed.

Consistent with established case law, the Tenth Circuit reversed the district court's summary judgment decision on two independent grounds.

First, properly noting that there has long been no requirement that an infringer use a mark on directly competing goods, the Tenth Circuit held that to state an infringement claim a trademark owner need only use the mark on a related product, that is, any product "related in the minds of consumers". By way of example, the court noted that the use of the AUNT JEMIMA trademark on pancake batter sufficed for finding infringement based on use of the same mark on pancake syrup, citing Aunt Jemima Mill Co v Rigney & Co (247 F 407, 409-10 (2d Cir 1917)). Thus, while the relation in use between the goods is a relevant factor when analyzing the likelihood of confusion - reflecting the fact that use of a mark on a directly competitive product is more likely to create confusion than use of the same mark on a distantly related product - the district court's finding that TPI's services were not a competing use could not operate as a "dispositive" determination of the infringement claim.

Second, the Tenth Circuit criticized the district court for finding that the TIRES PLUS registration did not encompass franchising services, but only consulting services. Relying on the US Patent and Trademark Office's standard definition of franchising services, and on the examining attorney's recommendation to TTPL during prosecution of the mark of the ultimate language used in the TIRES PLUS registration, the court held that the language of the registration was meant to be understood as covering franchising services and not just consulting services.

The court further stated that the appropriate question on remand for the district court remained whether the use by TPI of the name Tires Plus is likely to cause confusion understanding that:

"relevant confusion under trademark law is not limited to confusion of consumers as to the source of the goods, but also includes confusion as to sponsorship or affiliation, such as a consumer's mistaken belief that a retail tyre store is part of a larger franchising operation."

Through its holdings, this decision underscores the importance of statements made and actions taken in the prosecution of a mark. Years later, these actions and statements can be relied on and have an impact on the results of an enforcement action. Consequently, trademark prosecution requires careful strategic thought.

Rochelle D Alpert, Morgan Lewis & Bockius LLP, San Francisco

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