As reported by Reuters, Apple Inc. brought a trademark infringement lawsuit last year challenging Amazon.com Inc.’s right to use the name “Appstore.” Apple alleges that Amazon’s use of the name “Amazon Appstore” may have caused confusion among consumers. Apple subsequently amended its Complaint to also bring a claim for false advertising. Amazon has now filed a motion seeking a judgment in its favor on the false advertising claim.
The Lanham Act, the law governing trademarks in the United States, prohibits the use of a name that “misrepresents the nature, characteristics, qualities, or geographic origin” of “goods, services, or commercial activities” in “commercial advertising or promotion.” See 15 U.S.C. § 1125(a)(1)(B). Violations are actionable as false advertising.
Generally, in order to prove a false advertising claim, a plaintiff must show, inter alia, that: (i) the defendant made a false or misleading statement of fact in commercial advertisement of a product or service; and (ii) such statement deceived or had the capacity to deceive a substantial segment of potential consumers.
In its moving papers, Amazon contends that Apple has not identified a single false statement that Amazon has made about its “Amazon Appstore for Android.” Amazon also argues that the term “App Store” is part of the name of its store, and “not a statement about the nature, characteristics, or qualities” of its store.
It is interesting that Apple decided to amend its Complaint to assert a false advertising claim. Apple alleges that Amazon’s use of the term “Appstore” “has a tendency to deceive consumers into believing that Amazon’s service has the characteristics and/or qualities of Apple’s APP STORE services.” This claim, which appears to be predicated on the likelihood of consumer confusion, sounds more in the nature of trademark infringement than false advertising. Apple may have brought the false advertising claim after realizing that its trademark rights in “APP STORE” are weak, given that the term is now used generically to describe an online store in which consumers purchase downloadable applications for mobile devices.
It is well settled that terms that have become generic do not function as trademarks, and are therefore not protectable as such. This is because generic terms are used by consumers to describe a product or service, not to identify the source or origin of such product or service. For example, “ASPIRIN” for “pain relief medication” has long been deemed generic and therefore not protectable as a trademark. Trademarks, on the other hand, function to identify and distinguish the goods and services of one seller from those sold by all others.
Indeed, Amazon alleges that the use of “app store” has become commonplace in the industry. Amazon has even cited several statements made by officers of Apple in which they used the term generically to refer to competitors, commenting on “the number of App Stores out there” and the existence of “four app stores on Android.”
Amazon has called upon the Court to reject the notion that every trademark infringement claim automatically gives rise to a claim for false advertising. A hearing on Amazon’s motion is scheduled for the end of October. The case is Apple Inc. v. Amazon.com Inc. et al., No. 11-01327 (N.D. Cal.).
