Following the discussion on the DHC’s finding in the Forest Essentials case, we are pleased to bring to you another post by SpicyIP intern Aditya Bhargava, revisiting initial interest confusion and consumer sophistication in light of the DHC’s recent Under Armour decision. Aditya is a second-year law student at NLSIU Bangalore. He is interested in intellectual property, AI regulation and tech law. His previous posts can be accessed here.
Rethinking Initial Interest Confusion And Consumer Sophistication In The Digital Age: Unarmouring The Under Armour At The DHC
By Aditya Bhargava
In trademark jurisprudence, the Initial Interest Confusion (IIC) test has long been used to address situations where a consumer’s initial attention is drawn by a mark similar to a well-known trademark, even if there is no confusion at the point of sale. However, the Delhi High Court’s recent handling of cases involving Forest Essentials and Under Armour raises questions about the continued relevance and applicability of the IIC test. This becomes further important given the DRS (Keyword Advertising) case that came before the DHC last year. (Read here)
In my last post, I detailed the Forest Essentials case and critiqued Justice Dayal’s interpretation of the IIC test. Through feedback from Akshat Agrawal (see comments in my earlier post) and members of the SpicyIP team, I realized it would be worthwhile to present an alternative perspective. Justice Dayal’s reading of the IIC test offers a different set of advantages in our rapidly evolving digital world. This interpretation prompts us to consider new questions, especially given the assumptions of consumer sophistication and the availability of information.
To support this stance, I examine the recent Under Armour case, where Justice Dayal has again sought to evolve the tests for assessing trademark confusion, particularly in the context of the growing e-commerce and smartphone penetration (Para 8.26 of Forest Essentials and 15.18 of the UA order). This approach underscores the need to reassess traditional tests like IIC to ensure they remain relevant in contemporary settings.
Note for the Readers: Justice Dayal’s order in the Forest Essentials case is currently under review by the Division Bench of the Delhi High Court. In the Under Armour case, Justice Dayal relied on his own order from Forest Essentials. The future of the Initial Interest Confusion (IIC) doctrine, regardless of the arguments made by me and other contributors to SpicyIP, hinges on how the Division Bench interprets IIC in the Forest Essentials case, which will also impact the Under Armour ruling. Notably, the Division Bench’s preliminary observations have not been favourable to Justice Dayal’s interpretation of IIC. It will be interesting to see how the IIC doctrine evolves in this context. Readers are invited to send in their thoughts on this as well!
Revisiting Initial Interest Confusion in the Context of Modern Consumer Behaviour
For the uninitiated, the Forest Essentials case involved a dispute where the plaintiff, Mountain Valley Springs, sought an injunction against Baby Forest for using similar branding. The plaintiff argued that the marks “BABY FOREST” and “BABY FOREST – SOHAM OF AYURVEDA” were deceptively similar to its established marks such as “FOREST ESSENTIALS” and related trademarks. The Court recognized the generic nature of the word “FOREST” and noted that consumers in the premium baby care market are sophisticated and unlikely to be confused by initial similarities. As a result, on 15th May, the court denied the injunction holding that confusion must exist throughout the transaction and initial confusion may not be enough to establish the likelihood of confusion. (Paragraphs 8.24 – 8.26)
On the other hand, the Under Armour case involved a global sportswear brand accusing the defendants of using the “AERO ARMOUR” mark, which Under Armour claimed was designed to confuse consumers and benefit from its brand reputation. Under Armour highlighted its extensive global trademark registrations and argued that the similarity in branding could mislead consumers. The Court (on 29th May) however, found that the differences in market segments and the overall branding strategies of the two parties were sufficient to prevent significant consumer confusion. (Para 12 onwards) Consequently, the Court denied Under Armour’s request for an injunction but imposed limitations on the defendants’ use of the “ARMR” element.
In both cases, Justice Dayal of the single-judge bench examined consumer behaviour in the digital age. In the Forest Essentials case, the Court acknowledged that consumers of premium baby care products are sophisticated, diligent, and resourceful. They would typically cross-check product origins and brands online before making a purchase, which reduces the likelihood of prolonged confusion. Similarly, in the Under Armour case, the Court recognized that modern consumers in the sportswear market are well-informed and use various resources to verify product authenticity, thereby minimizing the impact of any initial confusion.
However, where the difference lies is that in the Baby Forest case, the products and the product category are similar, targeting the same audience and price range. This can possibly lead to a higher likelihood of consumer confusion, as both brands cater to the same consumer base with similar pricing, increasing the chances of mistaken identity. In contrast, the Under Armour case involves products in the same category (apparel) but with distinct focuses: Under Armour on sportswear and Aero Armour on casual wear inspired by military themes. The price ranges also differ significantly ₹800 vs. ₹2000 (reliance placed on GUFIC Ltd. v. Clinique Laboratories, LLC), reducing the likelihood of confusion. Given these differences and the distinct consumer bases, placing the burden on the consumer to distinguish between the brands in the Under Armour case, in my opinion, isn’t unreasonable. But then, the follow-up question remains, how do we determine the sophistication of the consumer? What is the degree of diligence expected from a consumer? Would it vary as per the product, pricing or something else?
The Ephemeral Nature of Initial Confusion: Counter to My Previous Argument
The advent of e-commerce has fundamentally transformed the traditional retail landscape, undermining the relevance of the IIC test. Online shopping platforms provide consumers with immediate access to vast amounts of information, including product specifications, user reviews, and price comparisons. This digital environment enables consumers to make well-informed choices, thereby mitigating the impact of initial confusion which if any, is often transient. This transience is particularly evident in the context of both the abovementioned cases. In the Forest Essentials case, consumers are likely to engage in detailed research before purchasing premium baby care products and consumers seeking high-end sportswear are well-informed and rely on detailed product information, reviews, and comparisons available online. Hence any initial confusion caused by the “AERO ARMOUR” mark would be short-lived as consumers would soon realize the distinction between the brands through their research efforts.
In the digital age, do we even need the Initial Interest Confusion (IIC) doctrine to assess confusion? This doctrine assumes a level of consumer vulnerability that is no longer prevalent. It focuses on the initial capture of consumer attention, overlooking the subsequent stages of the consumer decision-making process. According to Justice Dayal’s understanding, modern consumers do not rely solely on their first impressions; they gather information, compare options, and make informed decisions. Rather than modifying the IIC to suit the current status quo—something that initiated the Division Bench’s intervention—I argue that it is better to discard the IIC test entirely and adopt a new framework that aligns with modern developments.
As argued by Eric Goldman, this new approach should consider the entire consumer journey, from the initial brand interaction to the final purchase decision, rather than focusing solely on the initial capture of consumer attention. This perspective is clearly explained by Justice Dayal in the Under Armour order, unlike the less clear interpretation in the Forest Essentials order. In Forest Essentials, it was difficult to determine whether Justice Dayal was differently interpreting the IIC or evolving a new test altogether. The attempt to modify the IIC conflated the idea of a new test that, among other factors, considered consumer sophistication and access to knowledge while making transactions. This ‘modification’ of the IIC prompted the Division Bench to take cognizance of the matter.
However, a reading of the Under Armour order, which also cites the Forest Essentials order, arguably clarifies Justice Dayal’s true intent. In Under Armour, a more clearly and lucidly written order backed by a thorough literature review, Justice Dayal has created guideposts that allow for addressing such cases without relying on one particular test or doctrine. One thing that is clear from both orders is that he believes the traditional reading of IIC is antithetical to the consumer sophistication that has evolved over the last decade. Another important point is that these guideposts should not be considered in isolation, especially given the proactive measures being taken by the legislature to reduce the likelihood of confusion on digital platforms and in e-commerce. One notable initiative is the Ministry of Consumer Affairs’ release of the Dark Pattern Guidelines 2023. It will be interesting to see how the courts integrate these guidelines with traditional trademark jurisprudence in the future.
In this “Under Armour vs. Aero Armour” case, Under Armour claimed that Aero Armour dishonestly adopted their trademark. Despite the similarities in lettering and Under Armour’s prior use of “ARMR,” the court ruled in favor of Aero Armour because they promised to discontinue using the trademark. This decision raises concerns about whether a simple promise of non-use is sufficient to resolve trademark disputes.
Under Armour argued that Aero Armour’s prior knowledge of their trademark indicated bad faith. Aero Armour countered that their use of “ARMR” was minimal and had already ceased, and they promised in court to stop using it. The court accepted this assurance, overlooking the initial dishonest adoption. This ruling is problematic because it only applies during the lawsuit, potentially allowing Aero Armour to resume using “ARMR” later.
In contrast, the Ansul Industries vs. Shiva Tobacco (2007) case emphasized the need for honest adoption from the start, stating, “Honesty of adoption at the initial stage itself has to be established… If the user at the inception is dishonest, subsequent concurrent user will not purify the dishonest intention.” This principle asserts that initial dishonesty cannot be rectified by later compliance or non-use.
The “ARMR case” diverges from this principle by focusing on future non-use rather than initial honesty, potentially undermining trademark integrity and encouraging dishonest practices. If upheld on appeal, this decision could set a precedent allowing defendants to avoid liability for dishonest adoption by promising future non-use.
The appeal’s outcome is crucial. The appellate court has the opportunity to reaffirm the importance of honest adoption, emphasizing that initial dishonesty cannot be mitigated by later assurances. The Under Armour vs. Aero Armour case underscores a critical issue in trademark law regarding dishonest adoption. The court’s current stance, which overlooks initial dishonest intent, conflicts with established principles. The appellate court’s decision will be pivotal in maintaining trademark law integrity and ensuring that initial honesty remains key in trademark protection.
Thank you for your comment.
Dear Reader, Thank you for your engagement with the post. Here are some responses to the same.
Statement: “Despite the similarities in lettering and Under Armour’s prior use of “ARMR,” ….. concerns about whether a simple promise of non-use is sufficient to resolve trademark disputes.”
Response: From my reading of the order, this interpretation may not fully capture the court’s actions. In addition to providing sufficient reasons regarding “ARMR,” the court also distinguished this case from the earlier Aditya Birla case involving the same plaintiff. Relevant references can be found in Paragraphs 15.15, 15.24, and 16.2.
Statement: “This ruling is problematic because it only applies during the lawsuit, potentially allowing Aero Armour to resume using “ARMR” later.”
Response: I respectfully believe that this is not entirely accurate. The petition before this court was solely for an injunction, which was subsequently denied. The case will ultimately be decided on its merits during the trial stage, and that will likely determine the fate of “ARMR.”
Statement: In contrast, the Ansul Industries vs. Shiva Tobacco (2007)….principle asserts that initial dishonesty cannot be rectified by later compliance or non-use.
Response: However, should we consider dishonest adoption in isolation? In the present case, the court examined multiple factors beyond just prior use. The court paid significant attention to aspects such as price differentiation, product category, and consumer bases.
Let me know your thoughts.
The court’s ruling in favor of Aero Armour was not merely based on their promise to discontinue using the “ARMR” trademark but was grounded in a comprehensive evaluation of multiple factors, which should not be overlooked.
The court adopted a holistic approach, examining the overall business proposition, market segment differentiation, and consumer sophistication. This approach aligns with modern consumer behavior, where buyers are well-informed and make decisions based on extensive online research. Aero Armour’s products cater to a niche market of military-themed casual wear, distinct from Under Armour’s sports apparel. The significant price difference between the brands further reduces the likelihood of consumer confusion.
The assurance of non-use of “ARMR” by Aero Armour was just one aspect of the court’s decision. The promise was made in the context of a broader evaluation of Aero Armour’s intent and business practices. Aero Armour demonstrated good faith by explaining the rationale behind their brand name, drawing from the founder’s background as an aeronautical pilot and the brand’s military-inspired theme. The court found no evidence of dishonest intent in the initial adoption of the mark.
The court noted, “The unique combination of these two words seems to be adopted for a reason: AERO refers to the aeronautical part of Armed Forces while ARMOUR is more associated with the military aspect reminding of the armours worn by armies in the historical past.” Additionally, the court highlighted WhatsApp conversations between Aero Armour’s promoters and their designers, which showed the brand “AERO ARMOUR” was conceived to associate with aviation and military categories. This evidence supported the notion that the brand was developed with a genuine, honest intent.
The Ansul Industries vs. Shiva Tobacco (2007) case emphasized the need for honest adoption at the outset. However, in the present case, Aero Armour’s initial intent was not found to be dishonest. The minimal use of “ARMR” was incidental, and they voluntarily ceased its use upon realizing the potential for confusion. The court recognized that modern consumers are sophisticated and capable of distinguishing between brands, especially when supported by ample online information. This understanding of consumer behavior is crucial in the digital age and differentiates this case from earlier precedents.
The court’s decision was based on a thorough analysis of various factors, including market segmentation, brand differentiation, and consumer behavior. This approach ensures that trademark integrity is maintained without disproportionately penalizing brands that operate in good faith. Should Aero Armour violate their assurance of non-use, Under Armour retains the right to pursue legal action. The court’s decision does not preclude future enforcement of trademark rights if warranted by subsequent actions.
The court’s ruling in the “Under Armour vs. Aero Armour” case reflects a nuanced understanding of modern trademark issues and consumer behavior. It emphasizes the importance of a comprehensive evaluation over a simplistic reliance on initial impressions. Upholding the decision on appeal would reinforce a balanced approach to trademark protection, ensuring that both honest business practices and consumer interests are safeguarded.
The court’s ruling in favor of Aero Armour was not merely based on their promise to discontinue using the “ARMR” trademark but was grounded in a comprehensive evaluation of multiple factors, which should not be overlooked.
The court adopted a holistic approach, examining the overall business proposition, market segment differentiation, and consumer sophistication. This approach aligns with modern consumer behavior, where buyers are well-informed and make decisions based on extensive online research. Aero Armour’s products cater to a niche market of military-themed casual wear, distinct from Under Armour’s sports apparel. The significant price difference between the brands further reduces the likelihood of consumer confusion.
The assurance of non-use of “ARMR” by Aero Armour was just one aspect of the court’s decision. The promise was made in the context of a broader evaluation of Aero Armour’s intent and business practices. Aero Armour demonstrated good faith by explaining the rationale behind their brand name, drawing from the founder’s background as an aeronautical pilot and the brand’s military-inspired theme. The court found no evidence of dishonest intent in the initial adoption of the mark.
The court noted, “The unique combination of these two words seems to be adopted for a reason: AERO refers to the aeronautical part of Armed Forces while ARMOUR is more associated with the military aspect reminding of the armours worn by armies in the historical past.” Additionally, the court highlighted WhatsApp conversations between Aero Armour’s promoters and their designers, which showed the brand “AERO ARMOUR” was conceived to associate with aviation and military categories. This evidence supported the notion that the brand was developed with a genuine, honest intent.
The Ansul Industries vs. Shiva Tobacco (2007) case emphasized the need for honest adoption at the outset. However, in the present case, Aero Armour’s initial intent was not found to be dishonest. The minimal use of “ARMR” was incidental, and they voluntarily ceased its use upon realizing the potential for confusion. The court recognized that modern consumers are sophisticated and capable of distinguishing between brands, especially when supported by ample online information. This understanding of consumer behavior is crucial in the digital age and differentiates this case from earlier precedents.
The court’s decision was based on a thorough analysis of various factors, including market segmentation, brand differentiation, and consumer behavior. This approach ensures that trademark integrity is maintained without disproportionately penalizing brands that operate in good faith. Should Aero Armour violate their assurance of non-use, Under Armour retains the right to pursue legal action. The court’s decision does not preclude future enforcement of trademark rights if warranted by subsequent actions.
The court’s ruling in the “Under Armour vs. Aero Armour” case reflects a nuanced understanding of modern trademark issues and consumer behavior. It emphasizes the importance of a comprehensive evaluation over a simplistic reliance on initial impressions. Upholding the decision on appeal would reinforce a balanced approach to trademark protection, ensuring that both honest business practices and consumer interests are safeguarded.
Dear Sir,
Thank you for your comment on the post. Your comment acts as a strong counter to one of the other comments on the post. Here are a few responses that I have from your comment.
Statement: Aero Armour demonstrated good faith by explaining the rationale behind its brand name, drawing from the founder’s background as an aeronautical pilot and the brand’s military-inspired theme.
Response: This seems important here given the Narrative that was built by the defendants (refer to para 10.13) was something that the court paid ample attention to. History of origin, how the idea was perceived etc were some of the things that were looked at.
Statement: The court recognized that modern consumers are sophisticated and capable of distinguishing between brands, especially when supported by ample online information. This understanding of consumer behaviour is crucial in the digital age and differentiates this case from earlier precedents.
Response: It would be interesting to see, as mentioned in the post, how the D.B. assesses this matter in the Forest Essentials Appeal. Will it consider consumer behaviour in the digital age differently from past precedents is something to watch out for.