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Source: http://www.ivanhoffman.com/initial.html

INITIAL INTEREST CONFUSION IN TRADEMARK DISPUTES IVAN HOFFMAN, B.A., J.D.

Here is the situation: a trademark owner claims another user is using an identical or confusingly similar mark in such a way so as to create confusion in the minds of the public. This is a normal allegation for trademark infringement actions of course. What makes this situation somewhat different and the subject of this article is that somewhere in the "use" being so made, generally before a sale is completed, the potential consumer is provided some information or the like that separates the claimed infringing use from any association with the mark or its owner. In other words, prior to the actual transaction, the consumer is no longer actually or potentially confused as to the origins of the product or service.       This matter can arise in both the world of offline trademark disputes as well as online. In the latter situation, this claim may result in a domain name dispute filed under the Uniform Domain Name Dispute Resolution Policy (UDRP) alleging that the Complainant owns rights in a trademark that a Respondent has used for a domain, which domain points to an active web site in which the Respondent is offering goods or services, whether for sale or otherwise. By active, I mean as opposed to the domain pointing to a "coming soon" page or something similar. However, somewhere on the home or other page of the Respondent's web site, some attempt is made to "disclaim" any connection to or endorsement or sponsorship by the Complainant and the Complainant's mark. Some Cases       In Checkpoint Systems, Inc. vs. Check Point Software Technologies, Inc., the Plaintiff (Systems) was the owner of a registered mark in "CHECKPOINT" and used the mark in selling security systems and monitoring devices. The Defendant (Software) wrote programs that protect and manage data (i.e. such as firewalls). Software marketed their products under the marks "CHECK POINT," "Checkpoint," and "CHECKPOINT." Systems tried to register "checkpoint.com" only to find that Software had already done so. Systems brought suit under the Lanham Act in the days before the UDRP was adopted.       The issue on appeal is whether Check Point Software's use of the "CHECKPOINT" mark is likely to create confusion as to the source of the parties' products.       The Court stated:
	To prove likelihood of confusion, plaintiffs must show that "consumers viewing the mark would probably assume the product or service it represents is associated with the source of a different product or service identified by a similar mark."
The Court analyzed the so-called "Lapp Factors" to determine whether or not there would be the likelihood of such confusion here. I would like to focus however on just the issue that is the subject of this article: the "initial interest confusion."       The Court stated:
	On appeal Checkpoint Systems argues the District Court erred because it limited its actual confusion inquiry to evaluating evidence of consumer confusion at the point of sale rather than according weight to evidence of investor confusion and other initial interest confusion. It contends the Lanham Act affords protection against other types of confusion, including initial interest confusion, investor confusion and post-sale confusion.
The Court agreed with the above position but found it not applicable in this case.
	[Trademark infringement] can be based upon confusion that creates initial customer interest, even though no actual sale is finally completed as a result of the confusion.       * * * [For example,] the likelihood that a potential purchaser of a specialized computer program may be drawn to the junior user, thinking it was the senior user, is actionable "confusion" even if over the course of several months of the purchasing decision-making process, the buyer's confusion is dissipated. Such a senior user who is the opposer may suffer injury if a potential purchaser is initially confused between the parties' respective marks in that the opposer may be precluded from further consideration by a potential purchaser in reaching his or her buying decision.
In other words, there is a valid claim that even though a sale was completed after any confusion was dissipated, the owner of the similar mark may have lost good will or the ability to influence that purchaser prior to sale because the purchaser was making its preliminary decision to purchase based on a mistaken belief that the product or service was that of the complainant and not what turned out to be the seller.       The Court cited a number of cases speaking to this issue. One was Dorr-Oliver, Inc. v. Fluid-Quip, Inc., cited by this Court, in which the Dorr Court stated:
	[T]he Lanham Act forbids a competitor from luring potential customers away from a producer by initially passing off its goods as those of the producer's, even if confusion as to the source of the goods is dispelled by the time any sales are consummated. This "bait and switch" of producers, also known as "initial interest" confusion, will affect the buying decisions of consumers in the market for the goods, effectively allowing the competitor to get its foot in the door by confusing consumers.
The Court also cited another case, Brookfield Communications, Inc. v. West Coast Entertainment Corp., in which that Court stated:
	"[I]n the Internet context, . . . entering a web site takes little effort--usually one click from a linked site or a search engine's list; thus, Web surfers are more likely to be confused as to the ownership of a web site than traditional patrons of a brick-and-mortar store would be of a store's ownership." [Emphasis added. Remember this portion as you read on.]
Moving now to cases dealing with the UDRP.       In Autosales Incorporated vs. Don Terrill, the Panel stated:
	The use of a disclaimer by Respondent is not sufficient to create a defense to bad faith under Paragraph 4(b)(iv) of the Policy, because of initial interest confusion. The Respondent's website and repeated use of Complainant's trademark in his website create a likelihood of initial interest confusion as to the source, sponsorship, affiliation, or endorsement of the Complainant's website. Even though a misdirected user may become aware that the website is not affiliated with the Complainant, the fact remains that the Respondent's improper and unauthorized use of the Trademark diverts the internet user seeking Complainant's official website. This initial interest confusion violates Complainant's rights in its trademark. See Brookfield Communs, 174 F.3d at 1057 (discussing likelihood of confusion and noting that "Web surfers are more likely to be confused as to the ownership of a web site than traditional patrons of a brick-and-mortar store would be of a store's ownership," and that even where people realize, immediately upon accessing the complained-of website, that they have reached a site operated by someone other than the trademark owner, the infringing website will still have gained a customer by appropriating the goodwill of the trademark owner).
The theory of the above case is that once a surfer finds the Respondent's site, there is already initial confusion even if it is later dispelled by a disclaimer or other mechanism whereby the surfer finds out that he or she is on a site not belonging to the Complainant mark owner. A significant evidentiary element is whether or not the Respondent's site is offering goods or services that are competitive with that of the Complainant. This is important because there has to be the potential for "confusion" in the minds of the visitor.       In Domain Bank, Inc. v Sonic Co., Ltd., the Panel found against such a finding not because they disagreed with the above legal principles but because the Complainant failed to present evidence supporting the claims.
	It has not provided any supporting evidence whatsoever. Evidence that the Respondent is engaged in, or intends to engage in, the same business as the Complainant would tend to suggest that the Respondent was benefiting from using the Complainant's domain name for the purpose of attracting customers to the Respondent's website. However, this has not been established. As to the claim of "initial interest confusion" weighing in favour of a finding of bad faith, there is no evidence that the Respondent intentionally registered or sought to use the disputed domain name for the purpose asserted by the Complainant. It is also not clear that users visiting would likely to be confused as to the association of the site with the Complainant, its business and the "Domain Bank" mark. There is also nothing to suggest an intention on the Respondent's part to disrupt the Complainant's business.
Further, a Panel in Intermark Communications Inc. v. Free Debt Consolidation Co., stated:
	The facts of this case do not support a finding of bad faith under Policy 4(b)(iv). The gist of Complainant's assertions is that consumers surfing the Internet who type in the wrong TLD when searching for free debt consolidation services would be diverted to Respondent's site to the detriment of the Complainant. There can be no "initial interest confusion" where the subject trademark constitutes an ordinary English word and the domain name holder has made no attempt to confuse potential consumers by associating itself with the Complainant without permission. See Brookfield Communications, Inc. v. West Coast Entertainment, Corp.
Finally, in Warm Things, Inc., Inc. v. Adam S. Weiss, that Panel stated:
	There is also no evidence that Respondent was using warmthings.com to sell products that are competitive with those of Complainant. Clearly, anybody who went to the website when it was in use would have known immediately that it had not reached the Complainant. U.S. courts have repeatedly held in the Internet context that initial interest confusion that arises from a defendant's use of a domain name is not legally significant where it is apparent once the consumer reaches a website that they are at the wrong site and have not reached the party they are looking for. As one court noted, "Internet surfers are inured to the false starts and excursions awaiting them." See Chatam International,. Inc. v. Bodum, Inc, 157 F. Supp. 2d 549, 558 (E.D. Pa 2001); accord, Strick Corporation v. James B. Stickland, Jr., 162 F. Supp. 2d 372, 377 (E.D. Pa. 2001); Hasbro, Inc. v. Clue Computing, 232 F.3d 1, 2 (1st Cir. 2000); Checkpoint Systems, Inc. v. Checkpoint Software Technologies, Inc., 269 F.3d 270 (3rd Cir. 2001). [Emphasis added]
Note in this last citation what appears to be a different point of view from that of the Brookfield Court about the skills of Internet surfers and our collectively ability to be "confused." Conclusion       These cases and all the others depend strongly for their respective resolutions on their respective facts. The principles remain essentially the same but how they determine the outcome is very strongly on a case by case basis.