Amazon is facing a trademark lawsuit brought on by a watchmaker which says the online store's search results can confuse potential customers, a federal appeals court ruled yesterday.
The 9th U.S. Circuit Court of Appeals in San Francisco issued a 2-1 opinion saying that the high-end watchmaker Multi Time Machine Inc. is entitled to a trial on its trademark allegations, reversing a lower court ruling.
The watch raising the issue is the MTM Special Ops, a military style watch that is not sold on Amazon. However, if an Amazon shopper searches for it, the site doesn't explicitly say it does not carry the watch. Instead, the search results, with MTM Special Ops in the search field, display similar watches made by different brands.
MTM sued Amazon because they say this could be confusing for shoppers and encourage potential MTM customers to buy a competitor's watch.
"We think a jury could find that Amazon has created a likelihood of confusion," the court wrote.
MTM would prefer that Amazon state that they don't carry any MTM products, but the change seems a bit unnecessary. Savvy online shoppers will understand that Amazon is just recommending similar products and MTM watches can be found elsewhere.
Judge Barry Silverman agreed. He was the lone dissenting voice saying "No reasonably prudent consumer accustomed to shopping online would likely be confused as to the source of the products."
After the federal appeals court decision, the lawsuit returns to the district court in Los Angeles.