To the extent you can rely on oral argument (admittedly, a dicey proposition), it seems a majority – if not all – of the Supreme Court Justices are poised to hold that a jury plays at least some significant role in determining the issue of trademark tacking. On December 3, 2014, the Supreme Court heard arguments in Hana Financial, Inc. v. Hana Financial, et al, No. 13-1211. Hana presents the issue of whether a party may “tack on” prior use of a somewhat different mark to its present mark, to claim exclusive trademark rights vis-à-vis the intermediate mark of an alleged infringer, is a question for the jury.
But the far more interesting colloquy concerned an issue decidedly less peripheral, and esoteric, to trademark litigation; that is, whether likelihood of confusion, an inquiry that is central to almost all trademark infringement cases, is one of fact or law. In most of the federal courts of appeal (the 1st, 3rd, 4th, 5th, 7th, 8th, 9th, 10th, 11th, and D.C. Circuits), likelihood of confusion is a question of fact, reviewable under the “clearly erroneous” standard. But in the Second and Sixth Circuits, it is a mixed question of fact and law, with the factual findings on the factors considered in determining likelihood of confusion (similarity of marks, goods, channels of trade, intent, etc.) reviewed under a clearly erroneous standard, but the ultimate weighing of those factors reviewed de novo. In the Federal Circuit, likelihood of confusion is a pure question of law, although subsidiary facts are reviewed for “substantial evidence”.
Some of the Justices seemed surprised to learn of this Circuit split, or indeed, that any court would view likelihood of confusion as anything other than a question of fact. And the Justices were downright perplexed that notwithstanding their outlier legal standard, even in the Second and Sixth Circuits, likelihood of confusion is an issue for the jury. This prompted Justice Sotomayor to wonder, “So what you’re saying, those courts that think it’s an issue of law, they still give it to a jury but then ignore what the jury says?” To which Sarah Harrington of the Solicitor General’s Office replied, “it’s some odd version of that.” HanaTranscript, p.42.
This, then, is “the elephant in the room”, as Justice Kennedy mused. Yet, the Court has at least twice denied certiorari on this issue (Euroquilt, Inc. v. Scandia Down Corp., 475 U.S. 1147 (1986); Elby’s Big Boy v. Frisch’s Restaurants, 459 U.S. 916 (1982)), though decades ago. Particularly if the Court does hold, as it seems it will, that tacking is a jury question, it would not be surprising to see a footnote in the Court’sHana decision, noting, but not deciding, the Circuit split on whether likelihood of confusion is a question of fact, law or somewhere in between – teeing it up for possibly the next trademark case accepted by the Court. Unless, of course, the Second, Sixth and Federal Circuits revisit their standards, in light of the Court’s analysis of the tacking issue.