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Amazon’s Latest Trademark Battle: A Race Against “Chime”

Posted in Infringement, Law Suits, Marketing, Technology, Trademarks

Last month, Amazon Web Services (“AWS”) announced a new application, Amazon Chime, for online meetings, including video and voice conferencing, chat, and screen sharing. Amazon Chime will compete against a crowd of other well-established products with similar services, such as GoToMeeting, Cisco WebEx, and Skype.

Just two weeks after Amazon Chime was announced, on February 22, AWS was sued by CafeX Communications for common law trademark infringement. CafeX’s complaint asserted the marks CHIME and CAFEX CHIME, based on its CafeX Chime online conferencing application. CafeX Chime, which offers video and voice conferencing, chat, and document sharing, was launched in February 2016. It won the “Best Of Enterprise Connect” award at the 2016 Enterprise Connect trade show in March 2016.

CafeX brought a motion for a preliminary injunction, arguing a likelihood of success based in part on the parties’ “virtually identical” marks and “identical” products and services. CafeX also argued that AWS was aware of CafeX’s “CHIME” mark and adopted the Amazon Chime mark in bad faith. Regarding irreparable harm, CafeX repeatedly referred to the upcoming 2017 Enterprise Connect trade show in Orlando next week (March 27-29), at which CafeX Chime is the defending “best of” award winner, and at which both parties will be presenting their respective “Chime” products at booths facing each other, a mere 30 feet apart–see the exhibit map below:Exhibitor Booth Map

AWS’s opposing brief argues that CafeX is unlikely to succeed on the merits based on several arguments, including for example: (1) CafeX has not made use in commerce of its asserted marks; (2) CafeX has no protectable trademarks as “Chime” is descriptive for business communication services; (3) the marks are dissimilar based on the “prominent use of [defendant’s] well-known [Amazon] house brand”; (4) there are some differences in the parties’ products; and (5) AWS obtained an Eveready survey that found 0% confusion.  (Note that CafeX vigorously disputes the validity and methodology of AWS’s survey in its reply brief.)

AWS also disputes CafeX’s bad faith argument, stating that although an Amazon employee visited the CafeX Chime booth at the 2016 Enterprise Connect trade show, that employee “had nothing to do with naming Amazon Chime and had never worked on the Amazon Chime team” and that “to the best of Amazon’s knowledge, CafeX was never mentioned by anyone on the Amazon Chime product or branding team” until this litigation. However, AWS concedes that a trademark clearance search was conducted, and then seems to imply that AWS was aware of the CAFEX CHIME mark.

Regarding the balance of equities between the parties (a factor in whether a preliminary injunction is appropriate), AWS stresses that it would be forced to spend hundreds of thousands of dollars and months of time to rebrand its product, reprogram its application, revise websites and marketing materials, and reshoot promotional videos, and that it would be practically impossible to reverse such a re-branding if AWS later prevailed at trial.

What do you think?  Stay tuned for updates on this contentious and high-stakes dispute.  The motion hearing is scheduled for tomorrow, March 24.