H&R Block Eastern Enterprises, Inc. v. Intuit, Inc., No. 13-0072-CV-W-FJG (W.D. Mo. May 22, 2013)
An anti-trademark-expansionist twofer: claim against comparative ad dismissed on the pleadings, and a holding that “confusion” doesn't mean just any kind of confusion. Now if only courts will start awarding fees ...
Intuit ran some comparative ads that H&R didn’t like, Master Plumber and Return Expert. H&R sued for false advertising and trademark infringement. The ads said “more Americans trusted their federal taxes to TurboTax last year than H&R Block stores and all other major tax stores combined” and showed a bar graph comparing TurboTax use versus other major tax stores, including H&R Block.
Intuit argued lack of confusion and nominative fair use; the court found it unnecessary to address nominative fair use. Intuit argued that, looking at the confusion factors, confusion was implausible: the ad was comparative (making strength and similarity irrelevant), there was no allegation of intent to pass of Intuit’s services as H&R Block’s, there were no allegations of actual confusion, and the type of product and conditions of purchases differed between in-store customers of H&R Block versus Intuit’s do-it-yourself software.
“Realizing that they have not pled confusion about the source or origin of the service represented by the trademark, plaintiffs seem to argue that ‘confusion’ under trademark infringement law should be read more broadly so as to include general confusion about the quality and nature of plaintiffs’ and defendant’s services.” Not so (that’s what §43(a)(1)(B) is for). Cases outside the Eighth Circuit “seemingly stand for the proposition that, when 15 U.S.C. § 1114 was amended in 1962 to delete the phrase ‘purchasers as to the source of origin of such goods or services,’ from the end of the former definition, which now reads ‘likely to cause confusion, or to cause mistake, or to deceive,’ this broadened the Act so as to now cover any kind of consumer confusion, mistake, or deception.” But in all those cases, the courts were examining infringement claims when the defendant had named its product or service similarly to that of plaintiff’s. None applied to classic comparative advertising, as here. Moreover, the 1962 amendments were about protecting non-purchasers, not just purchasers. (In fact, they were about protecting people who were potential purchasers, not just actual purchasers. People with no potential to be purchasers weren’t of interest because confusion wouldn’t harm them.)
None of H&R Block’s cited cases “expand trademark infringement law to include alleged confusion where it is clear from the context of the ads that the plaintiff is not an originator, sponsor, or endorser of the ad.” Thus, though consumer confusion is typically an issue of fact, the complaint here failed to plausibly plead confusion. The type of confusion contemplated by trademark law is “confusion as to source, origin, sponsorship, affiliation, or endorsement of a good or service.”