Confusion Evidence and the State-of-mind Exception in Unfair Competition Litigation
| Publication year | 1989 |
| Pages | 655 |
| Citation | Vol. 04 No. 1989 Pg. 655 |
1989, April, Pg. 655. Confusion Evidence and the State-of-Mind Exception in Unfair Competition Litigation
One such exception, the state-of-mind exception found in F.R.E. 803(3), is an effective tool when intent or state of mind is an element of proof. Perhaps the most vivid examples of the use of this exception are found in unfair competition litigation.
The increased ferocity with which commercial ventures enter the marketplace today increases the likelihood that competitors will find themselves confronted with competition that is unfair. Normally, the unfair competitor attempts to ride the coattails of its competition by trading on the goodwill established by the first comer to the market ("plaintiff").
This type of unfair competition can take many forms, but one of the most commonly recognized is in the form of trademark or service mark(fn1) infringement. The unfair competitor ("defendant") utilizes a trademark (for goods) or a service mark (for services) which is either identical to or so similar to the plaintiff's mark that it is likely to cause confusion or mistake or is likely to deceive the consuming public as to the source or origin of the goods or services. Generally, such conduct is prohibited by state and federal law.(fn2)
This article looks at confusion evidence in the context of unfair competition litigation and discusses how a practitioner can apply the necessary inquiries in such a case. The article considers only federal statutes, which are contained in the Lanham Act.(fn3) Under these statutes, the gravamen of any complaint is the allegation that the acts of the unfair competitor are likely to cause confusion, to cause a mistake or to deceive the consuming public as to the source or origin of the goods or services at issue.(fn4)
Numerous factors, or "digits," must be reviewed to determine whether there is a likelihood of confusion resulting from the actions of the defendant. Though not exhaustive, the list of factors considered by various federal courts include:
1) The type or strength of trademarks (or service marks) at issue.
2) The similarity of design.
3) The similarity or proximity of products (or services).
4) The identity of retail outlets and purchasers.
5) The identity of advertising media utilized.
6) The defendant's intent.
7) The likelihood that the prior owner will bridge the gap.
8) The quality of defendant's product (or service).
9) The sophistication of the purchasers.
10) Actual confusion.(fn5)
The last factor, actual confusion, constitutes one of the most persuasive forms of evidence to establish the likelihood of confusion.(fn6) Therefore, the admissibility of evidence tending to establish actual confusion is of critical importance to the plaintiff. In fact, such evidence may be the pre-eminent reason that equitable relief is granted.
The difficulty with actual confusion evidence is that, in addition to being difficult to obtain,(fn7) it may unduly burden trial proceedings with a host of witnesses. Certainly, the cost of bringing a significant number of "confusion" witnesses to the stand weighs heavily on the plaintiff's pocketbook. Further, the plaintiff must persuade each witness to come to the court (a hardship itself) to testify to his or her confusion. This assumes that the plaintiff can actually find the confusion witnesses, which is often difficult or impossible.
However, under F.R.E. Rule 803(3), the plaintiff can call fewer witnesses to testify about the confusion in the marketplace. For example, retailers can testify about customer confusion, media personnel can testify about readers' confusion from advertising and employees of the plaintiff (or even the defendant)
F.R.E. Rule 802 prohibits the admission of hearsay, unless an exception to the rule exists. Hearsay is defined in F.R.E. Rule 801 as follows:
1) A "statement" is (1) an oral or written assertion or (2) non-verbal conduct of a person, if it is intended by the person as an assertion.
2) A "declarant" is a person who makes a statement.
3) "Hearsay" is a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.
A statement which is not intended as an assertion is not deemed to be hearsay.(fn8) Also, statements which are not offered for the truth of the matter asserted are not hearsay.(fn9)
F.R.E. Rules 803 and 804 list the exceptions to the Hearsay Rule. The exception which is often relevant regarding the issue of actual confusion is Rule 803(3), the state-of-mind exception to the Hearsay...
To continue reading
Request your trial