Rearden LLC v. Rearden Commerce, Inc.

Summary judgment is generally disfavored due to the fact-intensive nature of trademark cases, and many such cases must be evaluated according to multiple-prong tests that require full development of the record.

Rearden LLC sued Rearden Commerce for trademark infringement under the Lanham Act, cybersquatting under the Anticybersquatting Consumer Protection Act (ACPA), and similar claims under California common law and California’s Unfair Competition Law (UCL). The District Court granted summary judgment in favor of Rearden Commerce. Under the Lanham Act, the Ninth Circuit found that a plaintiff must prove it has a protected interest in the trademark, and that use of the mark by another will likely cause consumer confusion. In order to prove that protected interest, the party must meet a “use in commerce” requirement, which is a two-prong test: (1) the mark is used or displayed in advertising, and (2) services are rendered in commerce. When determining if this test was met, the Court looked to the “totality of the circumstances,” which included evaluation of non-sales activities. The Court found the highly fact-specific test required to evaluate the “totality of the circumstances” precluded summary judgment. Likewise, genuine issues of material fact were present when evaluating consumer confusion. An eight factor test applies, and is flexible according to the facts of the individual case. As a result, summary judgment is disfavored because of the open-ended nature of the test. The Court also held non-consumer confusion may be considered in certain limited circumstances. Regarding the ACPA, the Court found there were genuine issues of material fact for a jury to evaluate, particularly regarding the issue of “bad faith” on the part of Rearden Commerce. Finally, as the state law claims are substantively similar to the federal claims, the Court held Rearden Commerce was not entitled to summary judgment on the UCL claim where the state and federal claims overlap. In summary, such a fact-intensive inquiry requires a full record and summary judgment was not appropriate. VACATED AND REMANDED.