Rival companies can use trademark and other "proprietary" terms even when there might be a risk of confusing customers, the U.S. Supreme Court ruled December 8.
Writing for the unanimous high court, Justice David H. Souter said companies accused of infringement do not have to show lack of customer confusion when invoking fair use defenses.
"If a plaintiff succeeds in making out a prima facie case of trademark infringement, including the element of likelihood of consumer confusion," Souter wrote, in KP Permanent Make-Up v. Lasting Impression, "the defendant may offer rebutting evidence to undercut the force of the plaintiff’s evidence on this (or any) element, or raise an affirmative defense to bar relief even if the prima facie case is sound, or do both."
The Supreme Court got involved in the first place when the 9th U.S. Circuit Court of Appeals in California held those invoking fair use had to show customers were unlikely to be confused. That put the 9th Circuit Court in conflict with the 2nd Circuit Court in New York, which ruled the opposite way in a similar case. The 9th Circuit Court got involved after a federal trial judge tossed Lasting Impression's lawsuit against KP for trademark infringement.
The trial court ruled KP had made fair use of the term "microcolors," a term KP claimed to have used pre-dating Lasting's registration of Micro Colors as a trademark in 1993. Both companies apply the term to products involving liquids that change skin color to cover scars and pigmentation disorders.
Trademark attorney William Pecau told reporters the Supreme Court ruling doesn't mean companies can't protect their products from genuine infringement that does confuse customers. "[I]f there's a large amount of confusion, the assertion of infringement could still prevail," he said.
Souter wrote that fair use defendants have no "freestanding need to show confusion unlikely," meaning "some possibility of consumer confusion must be compatible with fair use.
"The common law’s tolerance of a certain degree of confusion on the part of consumers followed from the very fact that in cases like this one an originally descriptive term was selected to be used as a mark," he continued, "not to mention the undesirability of allowing anyone to obtain a complete monopoly on use of a descriptive term simply by grabbing it first."
