• by Laurie Sullivan  @lauriesullivan, July 6, 2015

Amazon will face a trademark lawsuit brought on by Multi Time Machine (MTM) watchmaker that claims the online retailer's search results can cause confusion for potential customers, a federal appeals court ruled.

Los Angeles-based MTM, the maker of military style watches, has filed a lawsuit against Amazon for displaying search results of its competitors when shoppers search for its Special Ops watch style, which Amazon does not sell. Reuters reports that a 2-1 opinion from the 9th U.S. Circuit Court of Appeals in San Francisco will send the online retailer back to court after reversing a lower court ruling in 2013.

The lawsuit reads "Initial interest confusion occurs not where a customer is confused about the source of a product at the time of purchase, but earlier in the shopping process, if '"customer confusion creates initial interest in a competitor’s product.'" Even if that confusion is dispelled before an actual sale occurs, initial interest confusion still constitutes trademark infringement because it '"impermissibly capitalizes on the goodwill associated with a mark and is therefore actionable trademark infringement."

While much of it seems like a bunch of lawyer speak, MTM claims the result has been a loss of business because customers can click another link on Amazon and frequently pick an alternative watch designs suggested by the site.