United States: Tenth Circuit Finds Trademark Infringement Possible Where Mark Used on Related But Non-Competing Goods

The U.S. Court of Appeals for the Tenth Circuit has reversed a district court’s grant of summary judgment of no infringement, holding that the use of a mark on related but non-competing goods can constitute infringement under the Lanham Act. Team Tires Plus Ltd. v. Tires Plus Inc., Case No. 03-2300 (Tenth Cir Jan. 6, 2005) (McConnell, J.).

In 1983, Team Tires Plus Ltd. registered the TIRES PLUS mark for "rendering technical aid and assistance in the establishment of automobile tire stores and automobile maintenance centers." In 1986, the defendant, Tires Plus, opened its first retail tire store named Tires Plus in Albuquerque, New Mexico. Though it objected to the use of the mark in letters in 1994 and 1995, the plaintiff (which operated its business primarily in the Minneapolis-St. Paul metropolitan area) took no legal action until 2001, after it had decided to expand its operation to New Mexico and neighboring states. The district court dismissed the plaintiff’s claims on summary judgment on the grounds that consulting services and tire sales were not competing businesses. The plaintiff appealed.

Quoting from the Supreme Court’s 1992 Two Pesos decision, the Court of Appeals held the district court erred by assuming that a trademark provides protection only when the defendant uses the mark on directly competing goods. It reiterated that the key inquiry is whether the consumer is ‘likely to be deceived or confused by the similarity of the marks.’"

The district court also erred when it held that the plaintiff’s mark "cannot reasonably be considered to cover franchising." The Court of Appeals looked to the exchange between the plaintiff and the U.S. Patent and Trademark Office (USPTO) and held that the USPTO was aware that the plaintiff was engaged in franchising and understood the mark description to cover franchising. Accordingly, the Court of Appeals remanded for a new likelihood-of-confusion analysis.

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