Company sues school district for trademark infringement

A company sued a school district for trademark infringement. The plaintiff company designs campaigns to build excitement around reading by incentivizing children to read through its "Millionaire's Reading Club," which offers prizes such as certificates, T-shirts, drawstring backpacks and fake money. The company holds trademarks for the phrases "Read a Million Words," "Million Dollar Reader," "Millionaire Reader," and "Millionaire's Reading Club."

The school district held a "million-word" reading program that contained identical requirements to the company's program. The company alleged in its lawsuit that the program infringed on its trademarks because it used products and services that were allegedly identical to or confusingly similar to its trademarked products. The district court dismissed the lawsuit and the company appealed to the Court of Appeals.

The Court of Appeals noted that in order to prove trademark infringement, the mark holder must prove that the challenged product or service "creates a likelihood of confusion in the minds of potential consumers as to the source, affiliation or sponsorship" between the infringer's product and the trademarked product. If no confusion is likely to occur, there is no grounds for trademark infringement.

In this case, the Court of Appeals found that it was not difficult to distinguish the school district's program from the "millionaire" themed program marketed by the company. Indeed, the school district was able to show that "millionaire" themed reading challenges are widespread in the educational field, and that people were unlikely to confuse those programs with the products offered by the company. Accordingly, the Court of Appeals upheld the decision made by the district court and the lawsuit was dismissed.