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IP/Entertainment Case Law Updates

Wreal, LLC v.

In trademark dispute over Amazon’s use of set-top box name “fireTV,” Eleventh Circuit clarifies likelihood of confusion analysis in reverse-confusion cases, reversing summary judgment in favor of Amazon.

Miami-based pornography company Wreal LLC sued Amazon for trademark infringement based on Amazon’s use of the mark “fireTV” in connection with set-top box television devices. Wreal had registered the mark “FyreTV” in 2008 for use in connection with a pornographic streaming service and a set-top box device. Wreal claimed infringement under a theory of reverse confusion, arguing that Amazon’s 2012 adoption of “fireTV” overwhelmed the market and caused false association with the source. The district court denied Wreal’s motion for a preliminary injunction and, after the close of discovery, granted summary judgment in favor of Amazon, finding no likelihood of confusion between the marks under the Eleventh Circuit’s seven-factor test. Wreal appealed, and the Eleventh Circuit reversed and remanded the case for a trial on the likelihood of confusion issue, clarifying that certain factors should be analyzed differently in cases of reverse confusion than those of traditional trademark infringement. 

In reverse-confusion cases, the plaintiff is usually a commercially smaller but more senior user of the mark, while the defendant tends to be a commercially larger but more junior user. Rather than the defendant using the mark to profit from the plaintiff’s goodwill, the plaintiff is harmed when consumers associate its mark with the defendant’s corporate identity, undermining the goodwill the plaintiff developed in the mark first. In this context, the appellate court conducted a de novo review of each of the seven likelihood of confusion factors. 

In traditional forward-confusion trademark infringement cases, the first factor, the distinctiveness of the mark, is analyzed only by looking at the conceptual strength of the plaintiff’s mark. 

The Eleventh Circuit held, however, that in reverse-confusion cases, the distinctiveness of the mark should be analyzed by comparing the relative commercial strength of the defendant’s mark together with the conceptual strength of the plaintiff’s mark. Applying this framework, the court reasoned that the conceptual strength of Wreal’s FyreTV mark together with Amazon’s “overwhelming commercial success” pushed the scales in favor of Wreal on this factor. 

For the second factor, the similarity of the marks, the appellate court reached a conclusion opposite that of the district court, finding the marks FYRETV and FIRETV to be “nearly identical.” The court also clarified that although the presence of a housemark (such as “amazon fireTV”) is likely to dispel confusion in traditional trademark infringement cases, the presumption should actually be reversed when the theory is reverse confusion. The court reasoned that because the harm in reverse-confusion cases is false association of the plaintiff’s mark with the defendant’s corporate identity, the defendant’s use of a housemark alongside the mark at issue is more likely to cause more confusion rather than less. Under this guidance, the court held that the second factor should have weighed in Wreal’s favor as well.

The third likelihood of confusion factor, the similarity of the products, analyzes whether the two products at issue are the type that the public could attribute to a single source. The Eleventh Circuit confirmed that this factor operates the same regardless of the theory of confusion, but it held that it also weighed against summary judgment in Amazon’s favor. The court noted record evidence that Amazon offers some pornographic content and competes with other general-interest set-top boxes, such as Roku and Apple TV, that offer hardcore pornography content, and it concluded that a reasonable consumer could believe that Amazon was the source of a pornography-specific device. 

The appellate court further confirmed that the fourth factor, the similarity of sales outlets and customer bases, and the fifth factor, the similarity of advertising, maintained the same analysis in both forward- and reverse-confusion cases. The court agreed that both of these factors favored Amazon because Wreal’s products are only available through its own website and only advertised through other pornographic websites and channels.

On the sixth factor, the defendant’s intent, the Eleventh Circuit again shifted the analysis. Instead of focusing on whether the defendant adopted the plaintiff’s mark with the intent to derive a benefit from the plaintiff’s goodwill, as in forward-confusion cases, the court adopted the Ninth Circuit’s modified version of the intent factor for reverse-confusion cases. The court noted that “evidence of a specific intent to deceive is not a prerequisite to establish intent in reverse-confusion cases, as it is in forward-confusion cases.” Indicia of intent can come from a wide variety of sources, including a more generalized intent to obtain market saturation or to adopt a mark with constructive knowledge of the plaintiff’s mark. Amazon knew of Wreal’s mark before adopting its fireTV mark, and it tried to “flood the market.” The court concluded that this factor should have weighed heavily in favor of Wreal; when Amazon launched the fireTV, it specifically tried to flood the market with advertising in an attempt to lower awareness of Wreal’s similarly named product.

Finally, for the seventh factor, evidence of actual confusion, the relevant inquiry in a reverse-confusion case is whether there is “evidence that consumers of the plaintiff’s more senior mark became confused as to its source following the launch of the defendant’s more junior mark.” The court highlighted two instances in the record where consumers became confused about the source of Wreal’s products following the launch of Amazon’s fireTV set-top box. Unlike the district court, the appellate court found that just “two reported instances of actual confusion [by potential or actual Wreal consumers] … are sufficient to make the issue one of triable fact and thus weigh[] in Wreal’s favor.” The court did not deem it necessary to address the consumer survey evidence.

Taking all the circumstances into account and considering all seven likelihood of confusion factors in the context of a reverse-confusion theory, the court concluded that summary judgment for Amazon was in error and remanded the case for a trial before a jury.

Summary prepared by Melanie Howard and Jordan Meddy    

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