Multi-Time Machine, Inc. v. Amazon.com

trademark

It often seems like Amazon.com sells just about everything. But sometimes it doesn’t have the one thing you’re looking for. Instead, when you search for that one special thing, Amazon shows you a list of similar items it does sell. Maybe you decide to buy one of those instead (ordering from Amazon being so convenient), or maybe you look elsewhere (because you really wanted that one special item).

A company that sells one of those products you won’t find on Amazon didn’t like the fact that Amazon searches pulled up a list of competing products, and so it sued for trademark infringement. It lost. Then it kind of won. And then it lost again.

The case is Multi-Time Machine, Inc. v. Amazon.com. Sadly, the plaintiff, despite its name, does not sell time machines. It does sell high-end watches, and to maintain its high-end image it does not sell them on Amazon. Customers looking for Multi-Time’s military style “Special Ops” watch on Amazon are instead presented with a list of military style watches from other manufacturers. Multi-Time claimed that display, cued by consumers’ use of the company’s product name, violated its trademark.

The legal battle highlights the purpose of trademark law, and the scope of trademark protection. Trademark law does not prevent people or companies (including competitors) from ever using your trademarked name or logo. It prohibits people and companies from using your trademark in way that actually confuses consumers, or is likely to confuse consumers.

To win its case, then, Multi-Time had to prove that Amazon consumers were likely to be confused, and to buy one of the displayed watches either in the mistaken belief they were buying a Multi-Time watch or because the search results made them think the displayed watches were the equivalent of the brand they entered in the search box. The concept is called “initial interest confusion,” and it is usually a very difficult theory to win on.

Which is why trademark attorneys were pretty surprised in July when the Ninth Circuit Court of Appeals ruled that the district court was wrong to dismiss Multi-Time’s case, and that a jury should decide if consumers were likely to be confused by Amazon. At Amazon’s request, the 3-judge panel reconsidered that ruling, and reversed itself a few months later. In that second decision, the Court said its decision turned on “the answers to the following two questions: (1) Who is the relevant reasonable consumer?; and (2) What would he reasonably believe based on what he saw on the screen?” Because consumers looking to spend hundreds of dollars on a watch are going to be discerning about their purchase, and because the Amazon page clearly labeled the other watches as different brands from different manufacturers, the Court decided (over one judge’s dissent) that there was no likelihood of confusion and affirmed the trial court’s dismissal of Multi-Time’s claim.

This is a victory for Amazon, obviously. But it’s of more general interest because the decision helps evolve the application of trademark law to the internet economy. Most of the law governing trademarks was developed by courts before the internet – and internet shopping – became part of our everyday lives. While the general principle underlying trademark law is the same, as the Ninth Circuit observed, “emerging technologies require a flexible approach” when we apply that principle to disputes that arise in the virtual world. Decisions like the one in Multi-Time v. Amazon offer guidelines to companies so they can have a better sense of when a competitor has crossed the line and infringed their trademark online.