ABSTRACT

The Western District of Pennsylvania granted defendants’ motion for summary judgment on plaintiff’s federal and state trademark and unfair competition claims based upon, inter alia, a lack of similarity between the marks and “isolated and idiosyncratic” evidence of actual confusion.  Notably, the court held that “component”—the only shared term between the parties’ COMPONENTONE and COMPONENTART marks—was generic for the parties’ goods, and gave the term little weight in its likelihood-of-confusion analysis between the marks ComponentOne and ComponentArt.  The court also discounted plaintiff’s actual confusion evidence as vague, de minimis, and self-serving.  In addition, the court agreed with defendant that the stimuli employed in plaintiff’s confusion survey were completely divergent from the conditions potential purchasers would encounter in the marketplace, entitling the survey to little weight.

CASE SUMMARY

FACTS

Plaintiff ComponentOne, LLC ("ComponentOne") and Defendant ComponentArt, Inc. ("Component Art") are competitors that develop, sell, and provide customer support for reusable software tools designed to be integrated into larger software applications, generally known as “components.”  Following a change of defendant’s name from Cyberakt to ComponentArt, plaintiff filed suit alleging a variety of state and federal claims, including trademark infringement, dilution, unfair competition, and civil conspiracy.  Before the court was defendant’s summary judgment motion on plaintiff’s claims of trademark infringement, unfair competition, civil conspiracy, and several others, as well as a countermotion by plaintiff to strike defendant’s arguments against its survey.  The court earlier granted defendant’s motion for partial summary judgment on the federal and state dilution claims, holding that the Trademark Dilution Revision Act of 2006 denied protection to marks that are famous only within a niche market, which was the only type of fame plaintiff had alleged in the case.

ANALYSIS

The court analyzed plaintiff’s trademark infringement, unfair competition, and false designation of origin claims under the Third Circuit’s ten-factor Lapp test.  In undertaking this analysis, the court noted that the first factor—the similarity of the marks—was the single most important factor in determining a likelihood of confusion.  Under this factor, defendant successfully argued that the “component” portion of the parties’ respective marks was generic, and therefore entitled to little weight in the similarity-of-marks analysis.  In addition, the court agreed with defendant that the “One” and “Art” portions of the marks were substantially dissimilar.  While the court acknowledged that the marks must be analyzed in their entireties, it found that the generic nature of the “component” term and the rank differences between the operative terms “one” and “art” trivialized any similarity between the marks.  The court concluded that the first Lapp factor favored defendant as a matter of law.

The court also focused considerable attention on the fourth and sixth Lapp factors, namely, actual confusion and the length of time the defendant used the mark without evidence of actual confusion.  The court sided with defendant concluding that plaintiff’s actual confusion evidence was unreliable and de minimis, and that its survey was bereft of evidentiary value due to methodological flaws.

As evidence of actual confusion, plaintiff offered twenty-eight alleged incidents, twenty-seven of which were admissible as nonhearsay.  In evaluating these incidents, the court noted its skepticism of actual confusion evidence collected by employees of a party on the ground that it tends to be biased or self-serving.  The court held that the existence of only twenty-seven alleged confusion events out of more than 490,000 interactions with third parties over the course of the period of coexistence was a de minimis showing of confusion.  Further, many of the incidents might have been caused by inadvertence rather than confusion, such as misdirected emails, and others could not be verified because they involved statements made to plaintiff’s employees at trade shows by anonymous attendees.  The court concluded that plaintiff’s “isolated and idiosyncratic” instances of actual confusion were insufficient to create a genuine issue of material fact with respect to the fourth and sixth Lapp factors.

Addressing plaintiff’s survey evidence, the court held that the stimuli employed in the survey were completely divergent from the conditions that potential purchasers encounter in the marketplace.  Instead of using stimuli consisting of screen shots of the parties’ websites, Google search results, or product listings from software resellers’ websites, all of which were established as ways in which relevant consumers would encounter the parties’ marks, plaintiff’s survey expert presented the parties’ marks on a plain background in large block letters followed by descriptions of the companies.  The court held that plaintiff failed to demonstrate that participants in the marketplace encountered the marks in this manner, and thus afforded the survey minimal weight as circumstantial evidence of actual confusion.  Accordingly, taken together with the “isolated and idiosyncratic” evidence of actual confusion detailed above, the fourth and sixth Lapp factors weighed in favor of defendant.

Finding the first, fourth, and sixth Lapp factors to be the most relevant in this case, the court granted summary judgment to defendant on the trademark infringement, unfair competition, and false designation of origin claims and discharged the remaining counts for lack of standing and failure to establish liability on the underlying claims.

CONCLUSION

This decision demonstrates the importance of evaluating likelihood of confusion between marks comprised in part of generic terms based on the remaining operative components in those marks.  In addition, the decision underscores the importance of selecting appropriate survey stimuli that are reflective of the manner in which customers would actually encounter marks in the marketplace.  Finally, the decision highlights the importance of gathering identification information when documenting evidence of actual confusion, presenting that evidence through reliable and unbiased witnesses, and considering the level of confusion in comparison to the total number of consumer interactions that took place during the period of coexistence.