Antitrust Law Daily Wrap Up, ADVERTISING—E.D. Wash.: Lack of confusion over “Multifab” mark dooms Lanham Act claims, (Aug 13, 2015)

By Greg Hammond, J.D.

A manufacturing and distribution company was not entitled to default judgment over Lanham Act false advertising and trademark infringement claims. In denying default judgment, the federal district court in Richland, Washington, determined that an unaffiliated website’s use of the manufacturer’s state-registered words “Multifab” and “Multifab, Inc.” did not raise a likelihood of consumer confusion and there was no evidence of actual deception (Multifab, Inc. v. ArlanaGreen.com, August 11, 2015, Mendoza, S.).

Multifab, Inc., a corporation that manufactures and distributes commercial industrial components and equipment, registered the words “Multifab” and “Multifab, Inc.” as business names and tradenames with the State of Washington. The company, however, did not register the names with the United States Patent and Trademark Office. ArlanaGreen.com, a website that features and displays pornographic images and videos, allegedly used the tradenames in metatags and among the contents of the website. Multifab moved for entry of default judgment on its false advertising, trademark infringement, Anti-Cybersquatting Consumer Protection Act, and Washington Consumer Protection Act claims.

False advertising. The court rejected Multifab’s Lanham Act false advertising claim, finding that the website’s use of the “Multifab” mark lacked a tendency to deceive a substantial segment of its audience—professional commercial equipment buyers. Without a tendency to deceive, and absent evidence that consumers were actually deceived by the website’s use of the mark, Multifab could not establish a successful false advertising claim.

Trademark infringement. Multifab’s trademark infringement claim was also unavailing, the court concluded, finding no likelihood of consumer confusion under the Sleekcraft factors. Three factors in particular weighed heavily against a finding that consumers would likely be confused as to the products’ source or affiliation: (1) proximity of the goods; (2) degree of consumer care; and (3) likelihood of expansion.

The court first found that given the stark contrast between the parties’ products—commercial industrial components and equipment and a variety of pornographic images and videos—it would be hard to imagine consumers confusing the source or affiliation of the products. The sale of pornography and industrial equipment do not target the same class of purchasers in any discernable way, the products are not similar in use or function, and they are not complementary in any way.

Second, given the sophistication of Multifab’s clients—consisting of professional commercial equipment buyers and companies—they would be resistant to confusion as to the source or affiliation of Multifab’s industrial equipment. Specifically, the court noted that, as professional buyers, plaintiff’s clients are presumed to exercise a much higher degree of care than the casual consumer, weighing strongly against a finding of likelihood of confusion.

Lastly, given the substantial difference between that parties’ products and that they are not marketed toward a common class of consumer, the court concluded that there is virtually no likelihood of expansion by either party into the other’s current or prospective commercial territory. The court therefore determined that no likelihood of consumer confusion concerning Multifab’s marks existed.

Because analysis of the unfair competition claim under Washington’s Consumer Protection Act generally follows that of a federal trademark infringement claim, turning on the likelihood of consumer confusion regarding the protectable mark, both the Lanham Act trademark infringement and Washington Consumer Protection Act claims were dismissed.

Cybersquatting. The court also denied the motion for default judgment with regard to the Anti-Cybersquatting Consumer Protection Act claim. It found that although the website and its owner may have acted in bad faith, the website did not incorporate the mark in the top-level or second-level domain name. Instead, the website referenced the mark in metatags and among the contents of the website, which does not constitute an anti-cybersquatting violation. Default judgment was therefore denied and Multifab’s claims were entirely dismissed.

The case number is 2:15-CV-0066-SMJ.

Attorneys: Geoffrey F. Palachuk (Paine Hamblen LLP) for Multifab, Inc.

Companies: Multifab, Inc.

Cases: Advertising ConsumerProtection WashingtonNews