Addressing issues of trademark infringement and Florida’s Deceptive and Unfair Trade Practices Act, the U.S. Court of Appeals for the Eleventh Circuit affirmed summary judgment ruling that where the product on which a mark is affirmed cannot be seen by a customer, there is no likelihood of confusion. Custom Mfg. & Eng'g, Inc. v. Midway Services., (11th Cir., Nov. 21, 2007) (Tjoflat, J.).

The plaintiff, Custom Manufacturing & Engineering, Inc. (Custom) had agreed to design for defendant Midway Services (Midway) a water-meter reading system to be installed in residential complexes, but Midway had cancelled the contract on the ground that Custom had breached it and hired a competitor to finish the job. In the midst of litigating the resulting breach of contract action, Custom alleged Lanham Act trademark infringement and false designation of origin as well as tortuous interference with business relations under Florida’s Deceptive and Unfair Trade Practices Act. The goods on which Custom’s mark was affixed were subcomponents (circuit boards) manufactured for use in a product that was marketed to apartment complex owners and managers, not to Custom’s customers. The district court affirmed summary judgment for the defendant, and the plaintiff appealed.

The 11th Circuit stated that the question in this case involves the likelihood of confusion in the post-sale context—namely, whether Custom’s or Midway’s potential customers are likely to be confused as to the origin of the circuit boards. The 11th Circuit noted that a likelihood of confusion analysis entails more than the mechanistic summation of the number of factors on each side; it involves an evaluation of the “overall balance.”

The 11th Circuit held that it is unlikely that the apartment owners and managers to whom Midway sold the water-meter reading systems would remove these covers and examine the circuit boards contained therein. The court also found that third parties, such as repairmen and firemen, are not properly considered “customers” under the Lanham Act. Even if the court had accepted as true that such persons were customers, the plaintiff presented no evidence of a likelihood of confusion. The court stated that recovery under the Lanham Act requires, at a minimum, “that confusion, mistake, or deception be ‘likely,’ not merely ‘possible.’” The court went on to state that “[l]ike the proverbial tree falling in a forest, the unauthorized use of a trademark that is never perceived by anyone cannot be said to create a likelihood of consumer confusion.”

Practice Note: This case stands for the proposition that trademark plaintiffs must identify both the relevant customers of their products and provide evidence in the record from such customers to prove a likelihood of confusion.