Trademark Infringement: Demonstrating Irreparable Harm...

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Trademark Infringement: Demonstrating

Irreparable Harm to Obtain an Injunction Navigating Inconsistent Court Treatment, Proving Harm With and Without Survey Evidence

Today’s faculty features:

1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific

THURSDAY, APRIL 21, 2016

Jonathan Hudis, Partner, Quarles & Brady, Washington, D.C.

Uli Widmaier, Partner, Pattishall McAuliffe Newbury Hilliard & Geraldson, Chicago

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Trademark Infringement: Demonstrating

Irreparable Harm to Obtain an Injunction

Navigating Inconsistent Court Treatment

April 21, 2016 Jonathan Hudis

[email protected]

(202) 372-9600

For permanent injunctive relief, federal courts used a four-

factor test, under which the moving party must show that :

1) It had suffered an irreparable injury;

2) Legal remedies were inadequate;

3) Considering the balance of hardships between the plaintiff

and defendant, a remedy in equity was warranted;

4) An injunction would not be against public interest.

See, e.g., Weinberger v. Romero-Barcelo, 456 U.S. 305, 313 (U.S. 1982).

Historical Standards for Granting Injunctive Relief

6

To obtain temporary injunctive relief, federal courts used a

similar four-factor test, under which the moving party must show

that:

1) It had likelihood of success on the merits;

2) It was likely to suffer an irreparable injury;

3) Considering the balance of hardships between the plaintiff

and defendant, a remedy in equity was warranted;

4) An injunction was in the public interest.

See, e.g., Univ. of Tex. v. Camenisch, 451 U.S. 390, 392 (U.S. 1981).

Historical Standards for Granting Injunctive Relief

7

Federal Courts traditionally applied a rather lenient standard

when granting injunctions in trademark cases:

Once a plaintiff showed it had a valid mark that was infringed — a likelihood of success on the merits — irreparable harm was presumed. See Brookfield Communs., Inc. v. W. Coast Entm't Corp., 174 F.3d 1036, 1066 (9th Cir. 1999) (noting application of presumption in trademark cases).

Historical Basis for Granting Injunctive Relief in Trademark Cases

8

• The presumption of irreparable harm in trademark cases can

be traced back to Judge Learned Hand’s assertion in Yale

Electric Corp. v. Robertson, 26 F.2d 972 (2d Cir. 1928),

commenting on the loss of control over goodwill when granting

an injunction in trademark infringement cases:

“This is an injury, even though the borrower does not tarnish [the mark], or divert any sales by its use; for a reputation, like a face, is the symbol of its possessor and creator, and another can use it only as a mask.”

Historical Basis for Granting Injunctive Relief in Trademark Cases

9

• Federal Courts Considering whether a Preliminary Injunction would Issue Required an Essential Fifth Element: a Showing of a Probability of Success on the Merits at Trial.

• If a Probability of Success on the Merits was Shown, there was a Presumption that the Requirement of Proving Irreparable Harm was Satisfied.

McCarthy, T. J., McCarthy on Trademarks and Unfair Competition, § 30:47.30 (4th ed., Thomson Reuters 2014).

The Traditional Trademark Law Presumption

10

Irreparable harm was presumed in trademark cases because:

Likelihood of confusion puts the goodwill associated with a trademark owner’s business at risk.

This type of injury is difficult to quantify.

Monetary relief is inadequate to compensate for the loss over control of reputation.

The Traditional Trademark Law Presumption

11

• Plaintiff Has Suffered Irreparable Injury.

• Remedies Available at Law, such as Monetary Damages, are

Inadequate to Compensate for that Injury.

• Considering the Balance of Hardships between the Plaintiff and

Defendant, an Equitable Remedy is Warranted.

• The Public Interest would not be Disserved by the Entry of the

Injunction.

eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006). (considering requirements for a permanent injunction)

What Now is Required for an Injunction ?

12

• eBay was a Patent Case.

• The Relief Sought in eBay was a Permanent Injunction.

• Among the Pronouncements of eBay was that an Injunction is Not Automatic upon a Finding of Validity and Infringement (that is, Irreparable Injury must be Proven, and Not Presumed).

eBay v. MercExchange, 547 U.S. at 392-94.

U.S. at 392-94.

For Purposes of Our Discussion: Points to Remember about eBay

13

The Supreme Court also has held that a preliminary

injunction cannot be based on the mere possibility of

irreparable harm.

Irreparable harm must be likely.

Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7 (2008).

Another Point to Consider …

14

• The TM Owner’s Business Goodwill and Reputation are in Peril.

• Mistaken Ass’n of Negative Impressions of Def’s G/S with Pl.

• Loss of Control over Quality over G/S Associated with the Mark.

McCarthy, Thomas J., McCarthy on Trademarks and Unfair Competition, § 30:47.30 (4th ed., Thomson Reuters 2014).

If eBay Effectively Dispensed with the Presumption of Irreparable Harm in Trademark Cases, then What is Required to Show Irreparable Harm for Purposes of Obtaining an Injunction? (McCarthy)

15

• Loss of Customers.

• Loss of Goodwill / Reputation.

• Actual (Past/Ongoing) or Threatened (In the Future).

Ross, Terence P., Intellectual Property Law: Damages and Remedies § 11.05[2][a][i] (Law Journal Press 2014).

If eBay Effectively Dispensed with the Presumption of Irreparable Harm in Trademark Cases, then What is Required to Show Irreparable Harm for Purposes of Obtaining an Injunction? (Ross)

16

• Risk of Reputational Loss.

• Lack of Quality Control over G/S Associated with the Mark.

• Def’s Acts or Omissions that have a “Tendency to Deceive.”

• Complaints as to Quality of G/S Provided.

• Queries as to Whether the Pl and Def are “Related.”

• Lost Business Due to the Confusion.

Banner, Brian E., Trademark Infringement Remedies, Chs. 4.III.B., 5.I.C.2., 6.III.A.2. (2d ed., Bloomberg BNA 2014).

If eBay Effectively Dispensed with the Presumption of Irreparable Harm in Trademark Cases, then What is Required to Show Irreparable Harm for Purposes of Obtaining an Injunction? (Banner)

17

• Cybersquatting Case.

• Def, hired by Pl for eCommerce website design, registered Pl’s

trademark as a domain name in his own name, rather in Pl’s

name. Def refused to transfer domain name without substantial

payment.

• Irreparable harm = lack of full control over websites bearing Pl’s

mark, and possible loss of goodwill.

Jysk Bed’N Linen v. Dutta-Roy, 810 F.3d 767 (11th Cir. 2015).

• Licensee’s sale of unauthorized food products (hamburgers) in

connection with Licensor’s mark, in violation of party’s license

agreement.

Benihana, Inc. v. Benihana of Tokyo, LLC, 784 F.3d 887 (2d Cir. 2015).

Proof of Irreparable Harm & TM Preliminary Injunctions: What Has Worked?

18

• False Advertising Case.

• Literally false product performance superiority claims (i.e.,

“more powerful steam”) made on packaging for steam irons.

• Irreparable injury = likely harm to Pl’s brand reputation and

goodwill; the fact that the parties are direct competitors, and that

harm to reputation and goodwill are impossible to quantify.

Groupe SEB USA, Inc. v. Euro-Pro Operating LLC, 774 F.3d 192 (3d Cir. 2014).

Proof of Irreparable Harm & TM Preliminary Injunctions: What Has Worked? (Cont’d)

19

• Substantial Proof of Likelihood of Confusion.

• Risk of Loss of Goodwill and Control over Food Products

associated with Mark.

• Difficulty of Quantifying the Effect on Pl’s Brand during

Nontrivial Period of Consumer Confusion.

Kraft Foods Group Brands LLC v. Cracker Barrel Old Country Store, Inc., 735 F.3d 735 (7th Cir. 2013).

• Impairment of TM Owner’s marketing of its own products and

services.

• Interference of TM Owner’s use of the Mark by Defendant’s

Continuing to Represent to 3rd Parties that Defendant Owned

the Mark.

Mercado-Salinas v. Bart Enters. Int’l, 671 F.3d 12 (1st Cir. 2011).

Proof of Irreparable Harm & TM Preliminary Injunctions: What Has Worked?

20

• Removal of UPC Codes.

• Absence of UPC Codes Increased Risk that Consumers Would

Unwittingly Purchase Counterfeit or Defective Merchandise

Associated with the Mark.

Zino Davidoff SA v. CVS Corp., 571 F.3d 238 (2d Cir. 2009).

• Threat to Loss of Sizeable Business in Mexico in Connection

with Pl’s Mark.

• Potential Confusion by Customers as to Who Was Providing

services in Mexico under Pl’s Mark.

• Loss of Control over Technology being Associated with Pl’s Mark.

Paulsson Geophysical Servs. v. Sigmar, 529 F.3d 303 (5th Cir. 2008).

Proof of Irreparable Harm & TM Preliminary Injunctions: What Has Worked? (Cont’d)

21

• Issuance of Preliminary Injunction Reversed and Remanded for

Further Findings.

• District Ct’s Analysis of Irreparable Harm Cursory and Conclusory

• Evidence of Loss of Control over Business Reputation and Damage to

Goodwill Could Constitute Irreparable Harm – The Record Here Lacks

Such Evidence.

• Evidence of Consumer Confusion is Not Equivalent to Irreparable

Harm.

Herb Reed Enters., LLC v. Fla. Entm’t Mgt., 736 F.3d 1239 (9th Cir. 2013), cert. denied,

135 S. Ct. 57 (2014) [Heavily Criticized by McCarthy].

• Co-Existence of Parties’ Marks and Banking Services for Three Months

with Scant Evidence of Actual Confusion

• Pl Failed to Make a Showing of Likelihood of Consumer Confusion

Peoples Fed. Sav. Bank v. People’s United Bank, 750 F. Supp.2d 217 (D. Mass. 2010), aff’d, 672 F.3d 1 (1st Cir. 2012).

Proof of Irreparable Harm & TM Preliminary Injunctions: What Has Not Worked?

22

• Issuance of Preliminary Injunction Reversed and Remanded for

Further Findings.

• District Ct’s Analysis of did Not Include Sufficient Findings on

the Likelihood of Confusion Factors.

• District Ct’s Analysis of did Not Include Sufficient Findings on

Likelihood of Irreparable Harm due to Def’s Ad Using Pl’s Mark

for Re-Sales of Crystal Figurines.

Swarovski Aktiengesellschaft v. Bldg. #19, Inc., 704 F.3d 44 (1st Cir. 2014).

Proof of Irreparable Harm & TM Preliminary Injunctions: What Has Not Worked? (Cont’d)

23

• Def’s use of confusingly similar mark on truck wheels found by

jury to infringe Pl’s mark used in connection engine cylinder

heads.

• Trial court issued permanent injunction, but permitted Def to

continue using infringing mark if accompanied by a disclaimer.

• On appeal, the Sixth Circuit Court of Appeals broadened the

injunction to prohibit all use of Def’s infringing mark.

• Irreparable injury = Pl’s loss of control over the reputation in its

mark, a harm that is neither calculable nor precisely

compensable.

CFE Racing Prods., Inc. v. BMF Wheels, Inc., 793 F.3d 571 (6th Cir. 2015).

Proof of Irreparable Harm & TM Permanent Injunctions: What Has Worked?

24

• DJ Pl/Ctrcl Def sold paddles and decorations bearing fraternity

and sorority names, without permission by the Greek fraternal

organizations.

• The trial court’s grant of a permanent injunction, with a few

limited exceptions, was affirmed on appeal.

• Caution: In affirming issuance of the trial court’s permanent

injunction, the Fifth Circuit Court of Appeals stated that “all that

must be proven to establish liability and the need for injunction

is likelihood of confusion – injury is presumed.”

• eBay casts doubt on this reasoning.

Abraham v. Alpha Chi Omega, 708 F.3d 614 (5th Cir.), cert. denied, 134 S. Ct. 88 (2013).

Proof of Irreparable Harm & TM Permanent Injunctions: What Has Worked (Cont’d)?

25

• Unauthorized use of Pl’s ministerial service marks.

• Summary judgment of infringement and permanent injunction

upheld on appeal.

• Caution: In affirming issuance of the trial court’s permanent

injunction, the Eleventh Circuit Court of Appeals stated that

“injury is presumed once a likelihood of confusion has been

established.”

• Once again, eBay casts doubt on this reasoning.

Community of Christ Copyright Corp. v. Devon Park Restoration Branch of Jesus Christ’s Church, 634 F.3d 1005 (11th Cir. 2011).


26

• Loss of Control over Pl’s Reputation and Goodwill

• Remedies at Law Inadequate to Compensate for this Type of

Harm

United States Polo Ass’n v. PRL USA Holdings, Inc., 800 F. Supp.2d 515 (S.D.N.Y. 2011), aff’d, 511 Fed. Appx. 81 (2d Cir. 2013).

• Def’s Website and Domain Name Used Pl’s Mark to Sell

Counterfeit Goods Online

• Remedies at Law Inadequate to Compensate for this Type of

Harm

Audi AG v. D’Amato, 469 F.3d 534 (6th Cir. 2006).


27

• Quinta Real (Mexico company) was permanently enjoined by

the trial court from entering U.S. hotel market, because it would

likely cause confusion with the La Quinta U.S. hotel chain.

• However, La Quinta (U.S. company) already was operating

hotels under its name in Mexico.

• The Ninth Circuit Court of appeals upheld the trial court’s

findings of likely confusion, but vacated the permanent

injunction and remanded the case for the trial court to further

consider the balance of hardships between the two

companies.

La Quinta Worldwide LLC v. Q.R.T.M., S.A. de C.V., 762 F.3d 867 (9th Cir. 2014).

Proof of Irreparable Harm & TM Permanent Injunctions: What Has Not Worked?

28

QUESTIONS?

Jonathan Hudis

[email protected]

(202) 372-9600

THANK YOU

29

Trademark Infringement: Proving

Irreparable Harm through Survey Evidence

Strafford Live CLE Webinar

April 21, 2016

Uli Widmaier Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP

Irreparable Harm

to Obtain Injunctive Relief • A universal legal requirement, not limited to IP law.

• Federal Judges are not IP specialists, and are

unlikely to view the requirement through

an IP lens.

• Keep in mind the “other” Supreme Court case

on irreparable harm!

• Appealing generically to “trademark harm”

won’t do.

• Think as a lawyer, not an IP lawyer.

31

Harm to marine mammals from

NAVY sonar

• “[P]laintiffs seeking preliminary relief [must]

demonstrate that irreparable injury is likely in the

absence of an injunction.”

• It is impermissible to infer irreparable harm from

strong likelihood of success on the merits.

Winter v. Nat’l Resources Defense Council, Inc., 555

U.S. 7 (2008) (emphasis in original).

32

Irreparable Harm Requirement:

Other Factual Contexts

Pindak v. Dart, 125 F. Supp. 3d 720 (N.D. Ill. 2015).

• Panhandlers’ Sec. 1983/First Amendment claim for

interference with panhandling on public plaza.

• “To obtain permanent injunctive relief, Plaintiffs must

show (1) they are likely to suffer irreparable harm in the

absence of injunctive relief; (2) the balance of equities

tips in their favor; and (3) an injunction is in the public

interest” (citing Winter).

• First Amendment harms are presumed irreparable.

Permanent injunction granted.

33



Shell Offshore Inc. v. Greenpeace, Inc., 709 F.3d

1281 (9th Cir. 2013).

• Claim to prevent Greenpeace from interfering with

Shell’s arctic drilling.

• Same factors as for permanent injunctive relief,

plus likelihood of success on merits.

• Harm requirement met through showing of

“unacceptable risks to human life, property and the

environment.”

34



Yaldo v. Wayne State University, 2015 WL 6082098 (E.D. Mich.

Oct. 15, 2015).

• Student’s suit against medical school for dismissal due to

tardiness and academic misconduct; No irreparable harm

shown under Winter; preliminary injunction for re-enrollment

denied.

• “An injunction should issue only where the intervention of a

court of equity ‘is essential in order effectually to protect . . .

against injuries otherwise irremediable.’” Quoting Weinberger v. Romero-Barcelo, 456 U.S. 305, 312

(1982) (quoting Cavanaugh v. Looney, 248 U.S. 453, 456 (1919)).

35

What does “irreparable harm”

mean for trademark surveys?

• The traditional view: Showing irreparable harm

is the same as showing via survey that

consumers are likely to be confused, deceived,

or misled.

• Is that view still valid?

• Must something else be shown?

• If so, what would that “something else” be?

36

Guidance from the Case Law?

• No “presumption of irreparable harm based solely on a

strong case of trademark infringement.”

• Evidence of actual confusion “simply underscores

customer confusion, not irreparable harm.”

Herb Reed Enterprises, LLC v. Fla. Ent’ment

Mgmt., 736 F.3d 1239 (9th Cir. 2013).

37

Consumer Confusion

≠

Irreparable Harm?

38

A Catch-22?

• Assume a Lanham Act plaintiff conducts a valid survey

showing likelihood of confusion.

• Before eBay/Winter, that survey would have supported

injunctive relief as a matter of course.

• But a valid likelihood of confusion survey indicates

strong likelihood of prevailing on the merits.

• Can that same survey be used to show irreparable

injury?

• Or is that the type of presumption that eBay/Winter

prohibits?

39

Case Law:

Likelihood of Confusion May Not Be Enough

• “[W]e do not address whether our previous rule . . . ‘that

a trademark plaintiff who demonstrates a likelihood of

success on the merits creates a presumption of

irreparable harm’ . . . is consistent with traditional

equitable principles. In other words, we decline to

decide whether the aforementioned presumption is

analogous to the ‘general’ or ‘categorical’ rules rejected

by the Supreme Court in eBay.”

Voice of the Arab World, Inc., v. MDTV Medical News Now,

Inc., 645 F.3d 26, 34 (1st Cir. 2011).

40

Recent Case Law:

Likelihood of Confusion Is Enough

• Quoting eBay on irreparable harm.

• But holding on irreparable harm: “All that must be

proven to establish liability and the need for an

injunction against infringement is the likelihood of

confusion—injury is presumed” (quoting McCarthy).

Abraham v. Alpha Chi Omega, 708 F.3d 614, 627 (5th Cir.

2013).

41

So which is it?

• “The case law suggests that in [the Fifth Circuit],

in a Lanham Act case, the presumption is

somewhere between shaky and reaffirmed.”

T-Mobile US, Inc. v. AIO Wireless LLC, 991 F. Supp. 2d 888, 928

(S.D. Tex. 2014) (emphasis added).

That assessment was confirmed in ADT, LLC, v. Capital Connect,

Inc., 2015 WL 6549277 (N.D. Tex. Oct. 25, 2015).

42

Use Herb Reed as a wakeup call

• In the Ninth Circuit—Herb Reed (2013)—there is

NO PRESUMPTION!

• Other Circuits are somewhere between the Fifth

and the Ninth.

• McCarthy calls the Ninth Circuit an “outlier”

(Sec. 30:47.30). Don’t count on it!

• The old days of simply arguing “confusion

therefore irreparable harm” are over.

43

T-Mobile (S.D. Tex. 2014):

an instructive case

• “The record is clear that Aio wanted to capture T–Mobile

customers. Through consumer-survey analysis and through

Aio's own focus-group testing, T–Mobile has presented

credible evidence demonstrating that Aio's use of broad

swaths or blocks of Aio plum is likely to, and, at least in some

instances, actually did, cause initial-interest confusion. . . .

This court finds a substantial likelihood of irreparable injury.”

T-Mobile, 991 F. Supp. 2d at 926 (emphasis added).

So far, so good . . .

44

T-Mobile: from confusion to harm?

• “T–Mobile has established a likelihood of confusion. T–

Mobile has shown a likelihood that potential customers will

be confused into thinking that Aio is affiliated or associated

with T–Mobile based on the confused association between

Aio's use of its plum color and T–Mobile's similar use of its

similar magenta color.”

T-Mobile, 991 F. Supp. 2d at 929.

Still so far, so good . . .

45

T-Mobile: “exceptional” showing

needed to get to irreparable injury

• “The court is not ruling that finding a likelihood of confusion

automatically results in finding irreparable injury and issuing

an injunction unless the defendant shows that the case is

exceptional. The narrow ruling is that based on the record

evidence, the likelihood of confusion over source and

affiliation in this market for no-contract wireless

telecommunications services creates a substantial likelihood

of injury that money damages cannot remedy. “

T-Mobile, id. (emphasis added).

46

T-Mobile: injury without presumption?

• “The products and services sold are fundamentally the same.

What separates the companies is their brand identity. The

evidence shows that color is a critical part of that brand

identity. On this record, without presuming injury, this court

finds and concludes that T–Mobile has shown a likelihood of

irreparable injury absent an injunction against Aio's use of

large blocks or swaths of plum in its marketing and stores.”

T-Mobile, id. (emphasis added) (emphasis added).

47

Wells Fargo:

a case that goes the other way?

• Likelihood of confusion survey: admitted into evidence, but

given “very little weight” because of its “serious deficiencies.”

• No preliminary injunction because “Wells Fargo has not

presented any evidence that its brand, reputation, and/or

goodwill will be harmed by defendants' alleged trademark

infringement, false affiliation, and/or false advertising, and

offers only the type of ‘platitudes’ that were rejected by the

Ninth Circuit in Herb Reed.”

Well Fargo & Co. v. ABD Ins. & Financial Serv’s, Inc., 2014 WL

4312021 (N.D. Cal. Aug. 28, 2014).

48

An Instructive Contrast

• T-Mobile: solid and “credible” survey evidence

establishes irreparable harm without resort to

any presumption.

• Wells Fargo: admissible but flawed survey is

given “very little weight” and thus contributes

nothing to the irreparable harm analysis. In

fact, it sabotages the irreparable harm analysis.

49

An Interim Summary

• Pre-eBay cases on showing irreparable harm

through surveys in Lanham Act cases: use with

caution!

• A survey does not necessarily overcome the

prohibition against presuming harm.

• Look for a solid causal nexus between

confusion shown by survey results and

irreparable harm.

50

Causal Nexus—Pom versus Fiji

• Fiji Water Co., LLC. v. Fiji Mineral Water USA,

LLC, 741 F. Supp. 2d 1165 (C.D. Cal. 2010).

• Pom Wonderful LLC. v. Pur Beverages LLC,

2015 WL 10433693 (C.D. Cal. Aug. 6, 2015).

51

Causal Nexus—Pom versus Fiji

• Two trademark infringement cases.

• Both post eBay/Winter.

• Both discuss irreparable harm in infringement

context.

• Fiji (2010) predates Herb Reed (2013) and its

finding that confusion evidence is not enough.

• Pom (2015) discusses Fiji at length, and

specifically in light of Herb Reed.

52

Fiji (2010): Irreparable Harm found

• “Winter's explicit requirement that a party

seeking a preliminary injunction must show

that irreparable harm is likely, not merely

possible, casts some doubt as to whether

that presumption [of irreparable harm from

loss of control over goodwill and reputation],

alone, is sufficient.”

53

Fiji (2010): Irreparable Harm found

• Finding irreparable harm:

“Allowing VITI to sell its bottled water with a trade

dress that is confusingly similar to the FIJI trade dress

jeopardizes FIJI's ability to obtain a reasonable return

on this substantial investment. Even more

concerning, VITI is interfering with and limiting FIJI's

ability to control the reputation of FIJI's recognized

brand and the perception of FIJI's premium quality

bottled water.”

54

Fiji: Survey Evidence

• “FIJI's consumer confusion survey provides substantial

evidence that actual consumers do know and recognize

the FIJI brand, based at least in part on its trade dress.”

• “FIJI submitted a blinded, controlled Eveready consumer

confusion survey of more than 400 respondents at a

sample of malls nationwide, which reported a 24.3%

confusion level after adjusting for the confusion found in

the control group.”

• “VITI's own expert survey . . . does not discredit FIJI's

survey.”

55

Pom (2015):

Interpreting Fiji after Herb Reed

• Recall: Herb Reed (2013) requires “that a

plaintiff adduce evidence of likely irreparable

harm” above and beyond consumer confusion.

• The Fiji court did not expressly make this

funding.

• The Pom court finds that Fiji meets the Herb

Reed standard.

56

Pom’s discussion of Fiji

• “The [Fiji] Court’s reference to plaintiffs' difficulty

obtaining a return on their investment was not a finding

that such a risk [of loss of control over reputation and

goodwill] was sufficient, in itself, to show

irreparable harm. Instead, the court found it significant

that plaintiffs had also made a showing of consumer

confusion that was likely to prevent them from

maintaining their reputation and goodwill with the

public.”

• “Not . . . sufficient”? It sure helped!

57

Pom: no irreparable harm found

• Contrasting Fiji: “[W]hile the Fiji Water court

had before it substantial evidence of consumer

confusion in the form of an expert survey, . . .

Pom Wonderful has proffered no evidence

plausibly suggestive of likely consumer

confusion or damage to its reputation and/or

goodwill.”

58

Pom: Failing to Meet the

Irreparable Harm Requirement

• “Here, there is no evidence of actual confusion,

no survey suggesting actual confusion is likely,

and no evidence that Pom Wonderful's ability

successfully to communicate its healthfulness

message has been impaired. Nor is there any

other type of evidence from which the court can

infer that irreparable harm is likely.”

59

Pom: what does it mean?

• Show evidence of harm separate from confusion—

such as concrete economic injury from loss of

control over reputation and goodwill.

• Produce a survey that creates a solid nexus

between that injury and consumer confusion.

• That combination may establish likely irreparable

injury.

60

Loss of Investment and Survey Evidence:

The Winning Combination?

• Adidas America, Inc. v. Skechers USA, Inc., 2016 WL

591760 (D. Or. Feb. 12, 2016).

• “Skechers' infringement undermines adidas's

substantial investment in building its brand and the

reputation of its trademarks and trade dress. adidas

submitted evidence showing it has spent tens of

millions promoting the Stan Smith, hundreds of

thousands promoting its Supernova shoes, and nearly

forty million annually on goods bearing the Three-Stripe

mark.”

61

Adidas v. Skechers

• “adidas's evidence indicating approximately twenty

percent of surveyed consumers believed the

Skechers Onix was made by, approved by, or

affiliated with adidas shows that adidas's carefully

constructed premium brand image is likely to be

confused with or associated with Skechers' value

brand.”

62

The Teaching of Adidas

• Similar evidence as in Fiji: showing of

substantial brand investment, plus a solid

confusion survey.

• That combination of evidence may (should?)

succeed to prove irreparable harm.

• Note: Fiji, Pom, and Adidas are Ninth Circuit

Cases, which has the strictest standard

because of Herb Reed.

63

Other Instructive Cases

National Financial Partners Corp. v. Paycom Software,

Inc., 2015 WL 3633987 (N.D. Illinois, June 10, 2015).

• eBay/Winter govern in Lanham Act cases.

• “The Court finds the Ninth and Third Circuits'

reasoning persuasive and concludes that NFP must

show a likelihood of irreparable harm to be entitled

to a preliminary injunction” (quoting Winter).

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National Financial Partners:

what needs to be shown?

• “To show irreparable harm, NFP need not

show that it lost business as a result of

Paycom's alleged infringement.”

• Plaintiff’s survey showed 39% confusion.

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National Financial Partners:

a strong survey is enough! • “The compelling evidence of consumer

confusion supports a finding of irreparable harm.

Where there is such high probability of confusion,

injury irreparable in the sense that it may not be fully

compensable in damages almost inevitably follows,

because the defendant's profits on the infringing items

are often difficult to determine and confusion may

cause purchasers to refrain from buying either product

and to turn to those of other competitors.”

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Another instructive case

Verisign, Inc., v. XYZ.com, LLC, 2015 WL 7430016 (E.D. Va.

Nov. 20, 2015).

• Irreparable harm not shown. Preliminary injunction denied.

• “Plaintiff does not proffer evidence beyond their subjective

belief that Defendants' statements caused harm. Plaintiff

does not submit testimonial evidence via experts or

consumers, and the consumer survey conducted does not

measure whether any statements resulted in economic or

reputational harm.”

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What do these cases stand for?

• In the Ninth Circuit, plaintiff should have a good

confusion survey plus other evidence of harm

that’s solidly linked to the confusion evidence.

• In other Circuits, a strong survey may by itself

suffice to establish irreparable harm. But it’s

best to make a broader showing.

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One thing has that not changed:

Poor Surveys Negate Irreparable Harm

• Preliminary injunction denied because “the focus group and

survey evidence submitted by Scotts was not reliable or

probative of the critical question in this case. “

• “[E]ven if the Vigoro packaging were misleading, the denial of

a preliminary injunction would cause very little harm to

Scotts.”

• The weakness of the survey evidence – even though formally

directed at likelihood of success on the merits – in truth

negated any irreparable harm.

Scotts Co. v. United Industries Corp., 315 F.3d 264 (2002).

That’s as valid as it has always been.

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Takeaways I

• Weak or methodologically flawed surveys are actively

counterproductive.

• Don’t introduce a survey whose design is vulnerable or whose

results are feeble.

• Outside the Ninth Circuit, a strong survey showing consumers

are confused or misled may serve to establish irreparable harm.

But there are no guarantees.

• Your survey may have to establish an “exceptional case” (T-

Mobile) on the merits in order to support a finding of irreparable

harm.

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Takeaways II

• Don’t rely on your survey alone.

• Put in concrete evidence of harm resulting from

confusion: investment in brand, difficulty of getting

consumers back, concrete harm to brand image, etc.

• Get out of the “presumption” mindset, both when

arguing your case and when putting your evidence

together.

• Defendants: many opportunities to use eBay/Winter

and progeny to your advantage.

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Thank you!

Any question?

Uli Widmaier

Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP 200 South Wacker Drive, Suite 2900

Chicago, IL

(312) 554-7923

[email protected]

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