A trademark is a symbol, phrase, or some other device that distinguishes ownership of a product or service. A trademark often stands as a mark of quality.
People that buy products from Amazon third-party sellers’ often rely on trademarks when making purchases. When they see a trademark, buyers know they are getting quality goods.
Federal law governs trademarks. Trademarks are described in section 32(1) of the Lanham Act.When it comes to Amazon sellers, trademark infringement occurs when Amazon third party sellers use unauthorized and improper business names identical or similar to that used by another seller.
If another seller uses your trademark or something similar to your trademark, in a way that confuses the buyer, there may be trademark infringement. The test is known as a “likelihood of confusion.”
A likelihood of confusion is “when the consumers viewing the mark would probably assume that the product or service it represents is associated with the source of a different product or service….”
Section § 1125(a) of the Lanham Act states that merchant sellers shall be liable in a civil action to any person that is likely to be damaged by the Amazon marketplace seller or Amazon marketplace reseller’s trademark infringement.
To bring an action under the law, actual damages need not be shown. You do not have to show that you actually lost money. To bring a case for trademark infringement, you must merely show the likelihood of damages.
In determining ‘confusion’ under the Lanham Act, the courts use something called the Polaroid test. The ‘Polaroid’ test was created by a court in a case called Polaroid Corp. v. Polara Electronics Corp. The eight factors of the Polaroid test include:
The strength of the plaintiff’s mark;
The similarity of uses;
The proximity of the products;
The prior owner may expand into the domain of the other;
Defendant’s reasons for using the plaintiff’s forbidden/restricted products;
Quality of the junior user’s product, such as used sold as new; and
Sophistication of consumers.
You don’t need to show all eight factors. The courts focus on the potential to confuse consumers.
What if I get sued or sue someone else for false advertising based upon use of a trademark?
There are three potential remedies that can be ordered in a false advertising case:
Injunctive relief: Injunctive relief is when a court orders someone do something or to stop doing something. Injunctive relief may be granted when the person suing demonstrates confusion because of false or deceptive advertising. Injunctive relief can also be granted if “irreparable harm” has been inflicted. That may include a decrease in sales that cannot be completely the fault of fake advertising.
Corrective Advertising: It is virtually impossible to prove that sales will be damaged. The party suing only has to establish that there’s a relationship between a decline in its sales and a competitor’s fake advertising.
Damages: To collect damages, the party suing has to show that some consumers were actually deceived. He may also have to show that the defendant used the false advertising for products not as described and in bad faith.