Ninth Circuit courts generally consider several factors, including the strength and value of the trademark rights asserted, the owner’s diligence in enforcing the mark, harm to the owner if relief is denied, good faith ignorance by the alleged infringer, competition between the owner and the alleged infringer, and the extent of the harm suffered by the alleged infringer as a result of the owner’s delay in pursuing trademark claims. A party asserting a laches defense must demonstrate that it has suffered prejudice as a result of the trademark owner’s unreasonable delay.
A dramatic application of these principles occurred in Tillamook Country Smoker, Inc. v. Tillamook County Creamery Assn., in which the Ninth Circuit found that a famous cheese maker had sat on its rights too long when it knew a smoked meat marketer had been using the Tillamook name for years. The Ninth Circuit concluded that the likelihood of confusion is the defining test for trademark infringement, not whether the infringing use is by a competitor of the trademark owner. Even if the goods are noncompeting, so long as the archetypical reasonably prudent purchaser is likely to be confused between the marks, the trademark owner has a right – and an obligation to avoid laches – to bring an infringement claim. By sitting on its rights, the trademark owner was placed in a difficult position – the more it showed a likelihood of confusion, the more it helped the defendant establish a laches defense. The lesson for trademark owners is: Take prompt action to guard your brand if consumer confusion is likely, even if the apparent infringer is not a direct competitor.