Watchmaker’s Amazon Suit Revived by the 9th

     PASADENA, Calif. (CN) – A jury must decide whether Amazon’s search results for a high-end watch that it is not licensed to sell left it liable, the Ninth Circuit ruled Monday.
     Multi Time Machine sells military-style “Special Ops” watches through its website and a limited number of authorized distributors, in which Amazon is not included.
     Customers who search for MTM’s watches on Amazon instead find product listings for similar products from MTM’s competitors and “sponsored links” to both MTM’s website and other online retailers.
     Though a federal judge found for Amazon against MTM’s trademark-infringement claims, a divided three-judge panel on the Ninth Circuit reversed today, saying a jury could find that Amazon has created a “likelihood of confusion.”
     MTM may show that Amazon violated the Lanham Act by creating “initial interest confusion,” the majority said, explaining that this “occurs not where a customer is confused about the source of a product at the time of purchase, but earlier in the shopping process.”
     “The issue is that the defendant’s use of the mark would cause initial interest confusion by attracting potential customers’ attention to buy the infringing goods because of the trademark-holder’s hard-won reputation,” Judge Carlos Bea wrote for the court.
     Judge Barry Silverman’s dissent meanwhile opens with a pop-cultural parallel.
     “I would hold that the district court correctly granted summary judgment in favor of Amazon, or as John Belushi might have put it, ‘No reversal. Affirm,'” Silverman wrote.
     In a 1978 “Saturday Night Live” sketch, Belushi played a waiter who responds to a customer’s request for Coca-Cola by saying, “No Coke. Pepsi.”
     “Would anyone seriously contend that the diner violated Coke’s trademark by responding to the customer’s order that it doesn’t carry Coke, only Pepsi?” Silverman asked.
     For Silverman, the case at issue presents a comparable situation.
     “Because Amazon’s search results page clearly labels the name and manufacturer of each product offered for sale and even includes photographs of the items, no reasonably prudent consumer accustomed to shopping online would likely be confused as to the source of the products,” Silverman said.
     The 34-page majority opinion concedes that the product details for competitors’ itemized products were clearly labeled, but says “the clarity of the search results page at issue is open to dispute.”
     Bea also noted that Amazon’s search results do not clearly label the products by MTM’s competitors as the results of behavior-based search technology rather than keyword searches.
     Moreover, Amazon employees have not responded to past complaints about non-responsive results for searches for products not carried by Amazon, the court found.
     “We are by no means certain that MTM will be able to prove likelihood of confusion under an initial interest confusion theory, but we are confident that the matter can be determined only by resolving genuine issues of material fact,” Bea wrote.
     Silverman countered that Amazon search results for MTM’s competitors are clearly labeled and accompanied by a photograph. Furthermore, there is “no evidence of actual confusion by anyone,” the judge said.
     “No rational trier of fact could possibly find that a reasonably prudent consumer accustomed to online shopping would likely be confused by the Amazon search results,” he said.
     Neither side could be reached for comment on Monday.

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