On March 20, 2025, the United States Court of Appeals for the Fourth Circuit issued a ruling in Westmont Living, Inc. v. Retirement Unlimited Inc. et al, 3:22-cv-00811-RCY, clarifying whether courts can rely solely on the geographical locations of the parties in determining whether a likelihood of confusion exists.
The plaintiff, Westmont Living (“Westmont”) provides retirement housing and assisted living services in California and Oregon. Westmont began operating in 2008 and obtained federal registrations for the trademark “Westmont Living” under a stylized drawing of two trees in 2009 and 2010 in connection with the aforementioned services. As part of its branding, Westmont Living has named its facilities using the word “Westmont” plus an indicator of the particular facility’s location (i.e. Westmont Riverside).
Retirement Unlimited Inc. (“RUI”) also provides retirement housing and assisted living services in Virginia, North Carolina, and Florida. RUI includes geographic descriptors in its naming of its facilities. Both parties advertise via the internet, including Google, Bing, and social media platforms such as Facebook, LinkedIn, and Twitter. Moreover, both parties have customers who have moved into their facilities from all over the country. Neither are their advertising or customer pools limited to any geographic area.
In 2018, RUI built a new facility outside of Richmond, Virginia and named it “The Westmont at Short Pump” referencing a nearby community. RUI designed and applied for trademark protection of a logo for the facility made up of the name “Westmont at Short Pum” under a stylized “W.” However, the United Staes Patent and Trademark Office (“USPTO”) denied registration of the mark, citing a likelihood of confusion with Westmont Living’s trademark. RUI proceeded to use the name and logo in connection with the Richmond, Virginia facility.
In July 2020, Westmont Living sent RUI a cease-and-desist letter arguing that customers were likely to believe the “Westmont at Short Pump” facility was connected, sponsored, or associated with Westmont Living. Following RUI’s refusal to cease using the name and logo, Westmont Living filed a lawsuit against RUI in December 2022 for trademark infringement and unfair competition under both the Lanham Act and Virginia law.
In ruling on the parties’ cross-motions for summary judgment, the district court relied on Dawn Donut Co. v. Hart’s Food Stores, Inc., 267 F.2d 358 (2d Cir. 1959) and held that RUI’s use of the “Westmont at Short Pump” logo did not infringe upon Westmont Living’s valid trademarks as the two businesses operated in different geographic regions, and therefore, that the likelihood of confusion was impossible. On November 3, 2023, Westmont Living filed an appeal in the Fourth Circuit arguing that the district court failed to apply the appropriate test for trademark infringement.
The Fourth Circuit highlighted that while the geographic region in which a business operates and advertises is a factor in the analysis of whether a junior mark can cause a likelihood of confusion with a senior mark, it is only one factor out of nine and should not be given decisive weight. Further, the Fourth Circuit pointed out that other courts have held that where a senior trademark’s reputation has gained influence in a market where it does not operate, there may still be the potential for infringement or unfair competition by the junior trademark, especially if the senior trademark owner advertises in markets outside of its geographic location.
The Fourth Circuit stated that the likelihood of confusion analysis does not “begin and end with geographical territories, particularly when the reputation of the senior user’s mark has been carried into a trade area prior to the junior user’s adoption and use.” Moreover, Westmont Living was able to provide evidence that when searching the internet for assistant living facilities, there was actual confusion between the marks and prospective customers believed that RUI’s “Westmont at Short Pump” was affiliated with Westmont Living. Accordingly, the Fourth Circuit held that a likelihood of confusion is more likely where the parties provide the same services, have identical names, and advertise on a nationwide scale. Accordingly, the Fourth Circuit vacated and remanded the district court’s previous ruling.
As internet and social media marketing has become more prevalent, if not a requirement for most businesses, businesses and their owners should be mindful of the increased possibility that their trademarks can be deemed to cause substantial confusion in the marketplace if there is a senior trademark that contains the same words, for a business that provides the same services, even if the competing business operates solely in a distant part of the country.
Article by Ashley Pendleton