Fortres Grand Corporation v. Warner Brothers Entertainment
112 U.S.P.Q. 2d (BNA) 1154, 763 F.3d 696, 2014 WL 3953972 (2014)
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Rule of Law:
A trademark infringement claim based on reverse confusion requires a plausible allegation that consumers are likely to be confused about the origin, sponsorship, or approval of the senior user's tangible product, not merely confused about a fictional product within the junior user's creative work.
Facts:
- Fortres Grand Corporation develops and sells a security software program called 'Clean Slate'.
- Fortres Grand holds a federally registered trademark for 'Clean Slate' for computer software used to protect public access computers by restoring them to their original configuration.
- In July 2012, Warner Bros. Entertainment Inc. released the movie 'The Dark Knight Rises'.
- In the movie, a character is offered a fictional hacking program known as 'the clean slate', developed by 'Rykin Data Corporation', which enables an individual to erase all traces of her criminal past.
- As part of the movie's marketing, two websites were created purporting to be affiliated with the fictional Rykin Data Corporation, describing the 'clean slate' hacking tool.
- After the film was released, Fortres Grand noticed a significant decline in sales of its Clean Slate software.
- Fortres Grand believed its decline in sales was due to potential customers mistakenly thinking its Clean Slate software was illicit or phony because of Warner Bros.' use of 'the clean slate' in the movie.
Procedural Posture:
- Fortres Grand Corporation filed suit against Warner Bros. Entertainment Inc. in the United States District Court for the Northern District of Indiana, South Bend Division, alleging trademark infringement under the Lanham Act and Indiana unfair competition law, based on theories of both traditional and reverse confusion.
- Warner Bros. filed a motion to dismiss Fortres Grand’s complaint under Rule 12(b)(6) for failing to state a claim.
- The district court granted Warner Bros.' motion to dismiss, concluding that Fortres Grand had not alleged a plausible theory of consumer confusion and that Warner Bros.’ use of the words 'the clean slate' was protected by the First Amendment.
- Fortres Grand appealed the district court's dismissal to the United States Court of Appeals for the Seventh Circuit, arguing only its reverse confusion theory.
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Issue:
Does a trademark holder plausibly allege reverse confusion under the Lanham Act by claiming that a junior user's movie, which features a fictional software program with a similar name, causes consumers to mistakenly believe the trademark holder's tangible software originates from, is connected to, or is sponsored by the junior user?
Opinions:
Majority - Manion, Circuit Judge
No, a trademark holder does not plausibly allege reverse confusion under the Lanham Act by claiming that a junior user's movie featuring a fictional software program with a similar name causes consumers to mistakenly believe the trademark holder's tangible software originates from, is connected to, or is sponsored by the junior user. The court affirmed the district court's dismissal, holding that Fortres Grand failed to plausibly allege a likelihood of consumer confusion, which is fundamental to a trademark infringement claim. In analyzing the 'similarity of products' factor of the likelihood of confusion test, the court concluded that the proper comparison for reverse confusion involving a fictional product in a creative work is between the senior user’s tangible product (Fortres Grand’s software) and the junior user’s tangible product (Warner Bros.’ movie), rather than the fictional software portrayed within the movie. Since a superhero movie and desktop management software are vastly dissimilar, and Fortres Grand failed to allege any facts suggesting these products would plausibly be attributed to a single source, this factor weighed heavily against confusion. Additionally, the court found other factors of the likelihood of confusion test weighed against Fortres Grand: the area and manner of concurrent use (movie dialogue/fictional websites versus Fortres Grand’s specific software website) made confusion unlikely; consumers of security software are generally discerning; and the mark 'clean slate' is broadly descriptive, limiting its strength. The alleged 'internet chatter' about the fictional hacking tool did not constitute actual confusion about the origin or sponsorship of Fortres Grand's software. The court declined to address Warner Bros.' First Amendment defense, as the complaint failed on the merits.
Analysis:
This case provides crucial clarification on the application of the reverse confusion doctrine in trademark law, particularly when the alleged infringement occurs within a creative work that features a fictional product. It establishes that courts should compare the senior user's tangible product with the junior user's tangible creative work (e.g., a movie), not a fictional product depicted within that work, when assessing product similarity for likelihood of confusion. This ruling prevents dilution claims for non-famous marks from being reframed as reverse confusion, reinforcing the statutory distinction between infringement and dilution. It also underscores that a general association with a fictional concept, even a negative one, does not automatically translate into actionable confusion regarding the origin or sponsorship of real-world goods.
