War for your “App Store”: Apple vs. Amazon: Federal Judge Unconvinced

Federal Judge Phyllis Hamilton of the U.S. District Court for the Northern District of California, denied Apple’s request for a preliminary injunction to bar Amazon.com from referring to its online software marketplace as an “Appstore” pending the outcome of Apple’s suit regarding the matter. Since 2008, Apple has used the term “App Store” to describe the online location where its shoppers can purchase software applications for their mobile devices (such as the iPhone and iPod). Since then, the online market has become saturated with similar downloadable software applications for mobile devices and online shops to purchase these products.

Apple argued that the term “App Store” was suggestive and not descriptive, while Amazon asserted that the mark was generic, and if descriptive was not inherently distinctive. The court disagreed with Apple’s argument that the mark was suggestive but would not go as far as saying that the term was “generic”. The court simply found no likelihood of confusion by consumers who know the difference between Apple products and Android.

Apple also asserted that Amazon’s use diluted its famous mark. As the early entrant in the market, Apple claims it has spent millions of dollars in marketing for the use of the term “App Store”. Nowadays the term is widely used across the industry by other software companies that provide software applications for mobile devices (such as Google, Microsoft, etc), causing the mark “App Store” to be perceived as a more descriptive and generic term rather than the dilution of a famous mark.

At the heart of their argument, Apple alleged there would be a “likelihood of confusion” amongst the “unsophisticated” consumer if Amazon continued to use the term “Appstore” in its title, although Amazon’s full title is, “Appstore for Andriod.” Amazon claimed the allegation is unsubstantiated because the entire title indicates that the applications in its online shop are solely for consumers using mobile devices powered by Android. Additionally, Apple urged the court to look at the term “App Store” as one term to determine that the mark was inherently famous as opposed to looking at both terms separately. Looking at the words separately, App (meaning “applications”) + Store would more likely deem the term descriptive, garnering little protection under U.S. trademark law.

This case raises interesting questions about the registration of marks that contain descriptive words in the title. To succeed on a dilution claim, a mark must be deemed famous and this analysis has several elements (See 15 U.S.C. §1125 (c)(2) (A)). However, famous or not, the question remains as to the protection of a term that accurately identifies a goods or service when that term is widely used in the industry. Judge Hamilton indicated it is unclear whether the term “App Store” gained recognition as an Apple trademark or was merely a descriptive term for electronic shopping. Even so, the court found that the term is not famous because Apple has not proven the term is “prominent or renowned.”

As Apple’s preliminary injunction was denied, other cases raising the question of descriptive vs. famous will most certainly come down the pipeline and force the courts to take a closer look at what marks are worthy of registration as our technology and consumer brands develop and evolve. Clearly the courts in the 9th Circuit are concerned with giving the early entrant a monopoly over a term that is used industry-wide.

For more see Apple Inc. v. Amazon.com Inc., 11-1327, U.S. District Court, Northern District of California (Oakland).