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By Bloomberg

Amazon.com Inc. must face a trademark- infringement suit by watchmaker Multi Time Machine Inc., which claims the online retailer’s search results can lead to confusion for consumers.

A three-judge panel for the federal appeals court in Pasadena, California, reversed a lower-court ruling that threw out MTM’s lawsuit, according to a court filing Monday. One judge dissented.

The appeals court said “a jury could find that Amazon had created a likelihood of confusion” because a search for MTM’s Special Ops watches will return a web page displaying the trademarked name -- but only with similar products made by competitors.

The Amazon search won’t say it doesn’t carry MTM Special Ops merchandise, the court said. The search results are a function of Amazon’s behavior-based search technology that links customers’ browsing habits to buying trends, the court said.

MTM said it could be harmed because a potential buyer might be confused and believe there’s some affiliation between the company and the products listed, leading consumers to buy competitors’ watches.

The court faulted Amazon’s failure to clearly state that it doesn’t carry MTM’s products. Other online retailers “announce that no search results match the ‘MTM Special Ops’ query,” and they don’t take the customer to a page with MTM’s trademarks “repeatedly at the top and competitors’ watches below,” the court said.

In dissent, U.S. Appeals Court Judge Barry G. Silverman said he would have upheld the lower-court’s ruling because the search results clearly display the competitors’ names along with the products.

The lawsuit will go back to the district court in Los Angeles, where MTM may press its claims. MTM sued Amazon in 2011. The case was dismissed after a federal judge said the trademarks weren’t entitled to protection.

The appeal is In re Multi Time Machine Inc. v. Amazon.com Inc., 13-55575, Ninth Circuit Court of Appeals. The lower-court case is Multi Time Machine Inc. v. Amazon.com Inc., 2:11- cv-09076-DDP-MAN, U.S. District Court, Central District of California (Los Angeles).

Patents

Apple Readying Peer-to-Peer Payments with Patent Application

Apple may be jumping into the crowded peer-to-peer payments service, according to documents filed with the U.S. Patent and Trademark Office.

The Cupertino, California-based maker of the iPhone submitted a patent application for an invention that allows users to make person-to-person payments with a wireless device.

The patent invention is credited to Timothy Hurley, Apple’s senior director of Apple Pay engineering, and Ahmer Khan, an Apple Pay software developer.

“It can be difficult for individuals to directly conduct financial transactions with each other using their electronic devices,” according to the application. It can also be time- consuming and costly for individuals to connect to a payment network, the way credit-card transactions are processed, according to the July 2 application.

“In spite of the considerable effort already devoted to the development of technology to support wireless financial transactions, further improvements are desirable,” the inventors said.

The device would exchange encrypted information packets, containing secured financial credentials, between one another and possibly a third party.

Authentication information to secure the exchange of information could include biometric identifiers including “ a fingerprint sensor, a retinal sensor, a palm sensor, a digital signature-identification sensor,” personal-identification numbers or pass codes.

To see the patent application, click here.

Enzo Biochem Settles Lawsuit With Luminex for $7.1 Million

Enzo Biochem Inc. reached an agreement with Luminex Corp. on Monday settling a lawsuit for $7.1 million, according to a company statement.

The settlement resolves one of 12 suits filed in Delaware Federal court over the alleged infringement of Enzo’s patents for DNA testing products. The remaining cases are pending.

The three patents Enzo was seeking damages for are U.S. patents 6,992,180, 7,064,197 and 8,097,405.

Luminex said it will make the payment in the third fiscal quarter this year and will result in a decrease of about $5.2 million to net earnings, or 12 cents a share, for the three months ended June 30, according to a corporate filing with the Securities and Exchange Commission. Luminex will get a license to the product as part of the settlement.

The case is In re Enzo Life Sciences Inc. v. Abbott Laboratories, 12-cv-00274, U.S. District Court, District of Delaware (Wilmington).

For more patent news, click here.

Trademark

Blue Sphere Seeks Documents from Arden in Taylor Swift Row

Blue Sphere Inc., a Costa Mesa, California-clothing company doing business as Lucky 13, is seeking documents from women’s beauty-products maker Elizabeth Arden Inc., in its battle against Grammy award-winner Taylor Swift.

The company, which claims Swift and her merchandising company wrongly used its “Lucky 13” trademark, claims Elizabeth Arden is “in possession of information highly relevant to the issues” and won’t turn them over. Blue Sphere issued subpoenas to Elizabeth Arden.

Blue Sphere argues that Elizabeth Arden and Swift considered using “Lucky 13” for her fragrance, a name Swift put on t-shirts, which also allegedly infringe.

Blue Sphere said it seeks to establish when Swift and Elizabeth Arden learned of the marks and whether they conducted a trademark-clearance search. The timing is important because it will help determine if the alleged infringement was committed willfully.

The case is In re Blue Sphere Inc. v. Elizabeth Arden Inc., 15-cv-22493, U.S. District Court, Southern District of Florida (Miami).

For more trademark news, click here.

Ex-Goldman Sachs Programmer Aleynikov Prevails Second Time

A former Goldman Sachs Group Inc. programmer who took the firm’s high frequency trading code when he left for another job was exonerated a second time after a judge ruled what he did wasn’t a crime.

Sergey Aleynikov, whose saga helped inspire Michael Lewis’s “Flash Boys,” was tried by New York prosecutors who took up the case after a federal conviction unraveled. His defense both times was that his actions were a disagreement between him and the bank better suited for civil litigation.

A state judge agreed, lining up behind a federal appeals court that found in 2012 existing criminal laws are a bad fit.

Aleynikov, 45, still faces a potential appeal by Manhattan District Attorney Cyrus R. Vance Jr. The prosecutor has said he won’t seek prison time for Aleynikov, who spent a year behind bars in the federal case.

“We think this defendant committed a crime,” Joan Vollero, a spokeswoman for Vance, said in an e-mail. “If what Sergey Aleynikov did isn’t a crime, then every company that values its intellectual property should be concerned.”

Both prosecutions raised questions about how intellectual property disputes between companies and employees should be resolved, especially on Wall Street. Defense lawyers said Aleynikov sought to copy “open-source” or public code, and that he tried to hide his actions only because he knew they violated bank policy.

“That Cyrus Vance would pursue this prosecution after Mr. Aleynikov spent a year in federal prison for crimes he did not commit is appalling,” Aleynikov’s lawyer Kevin Marino said Monday.