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Unit 5: Infringement of Trademark - Practice Quiz

LAW352 — Trademarks And Allied Laws 60 Questions
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1 What is the central element that a trademark owner must prove in an infringement case?

unauthorized use and likelihood of confusion Easy
A. Likelihood of confusion
B. Intent to deceive
C. The defendant's product is of lower quality
D. Actual financial loss

2 What is an 'injunction' in the context of trademark infringement remedies?

remedies Easy
A. A monetary payment to the trademark owner
B. A public apology from the infringer
C. A court order to stop the infringing activity
D. A government fine

3 Which of the following is a valid defense against a claim of trademark infringement?

Defenses against trademark infringement Easy
A. The trademark is too famous
B. Fair Use
C. The defendant's business is small
D. The defendant was unaware of the trademark

4 The 'first sale doctrine' or 'exhaustion' principle means that a trademark owner's rights end after what event?

exhaustion Easy
A. The trademark registration expires
B. The product is exported to another country
C. The product is advertised for the first time
D. The first authorized sale of the trademarked product

5 Trademark infringement occurs when a party uses a mark without permission in a way that is __ to a registered trademark.

unauthorized use and likelihood of confusion Easy
A. artistically superior
B. completely different
C. identical or deceptively similar
D. personally preferred

6 A repair shop advertises, "We service Apple® iPhones." This is likely a permissible use of the Apple® trademark known as:

use to indicate intended purpose of a product or services Easy
A. Abandonment
B. Descriptive fair use
C. Parody
D. Nominative fair use

7 Using a term in its ordinary, dictionary sense to describe a product's characteristics is known as what type of defense?

descriptive use Easy
A. Nominative fair use
B. Descriptive fair use
C. First sale doctrine
D. Laches

8 Which of the following is a type of monetary relief that can be awarded to a trademark owner in an infringement case?

remedies Easy
A. A formal letter of apology
B. A lifetime supply of the infringing product
C. Damages and profits of the infringer
D. A government grant

9 If John Smith, a baker, operates his business as "John Smith's Bakery," what defense can he use if a large corporation named "Smith Foods Inc." sues him for trademark infringement?

use of name or address Easy
A. Use of his own name in good faith
B. Trademark misuse
C. The parody defense
D. The exhaustion doctrine

10 The 'prior use' defense generally protects a person who was using a mark in a specific geographic area:

local use Easy
A. Only on the internet
B. After the registered trademark owner filed for federal registration
C. Only for non-profit activities
D. Before the registered trademark owner filed for federal registration

11 What does "unauthorized use" mean in the context of trademark law?

unauthorized use and likelihood of confusion Easy
A. Using a trademark that has expired
B. Using a trademark without the owner's permission
C. Using a trademark in a different color
D. Using a trademark for personal, non-commercial purposes

12 What does the ® symbol indicate about a trademark?

use of registered trademark Easy
A. The owner is thinking about registering it
B. The trademark is for a service (a service mark)
C. It is a common law trademark
D. It is officially registered with a national trademark office

13 What remedy involves the authorities taking possession of goods that bear an infringing trademark?

remedies Easy
A. Seizure and destruction of infringing goods
B. A public retraction
C. A cease and desist letter
D. Monetary damages

14 If you buy a genuine, new book with a trademarked publisher logo and then resell it online, this is generally permissible because of the:

exhaustion Easy
A. Fair use principle
B. Creative commons license
C. Exhaustion principle
D. Public domain principle

15 Which of the following scenarios is LEAST likely to cause a 'likelihood of confusion'?

unauthorized use and likelihood of confusion Easy
A. Selling shoes under the brand "Rollex" in a red box
B. Selling watch repair services under the name "Rolex Repairs"
C. Selling luxury watches under the brand "Rolex" in a green box
D. Selling high-end pens under the brand "Rolex Pens"

16 If a trademark owner waits too long to sue for infringement, and the delay harms the defendant, which defense might apply?

Defenses against trademark infringement Easy
A. Laches
B. Exhaustion
C. Nominative use
D. Parody

17 A company making generic ink cartridges states on its packaging, "Compatible with HP® printers." This use of the 'HP' trademark is intended to:

use to indicate intended purpose of a product or services Easy
A. Indicate the intended purpose of its product
B. Suggest that HP endorses the product
C. Confuse customers into buying the wrong product
D. Claim ownership of the HP trademark

18 What is the primary goal of the remedies available for trademark infringement?

remedies Easy
A. To punish the infringer with jail time
B. To prevent consumer confusion and compensate the owner
C. To force the infringer out of business
D. To generate revenue for the government

19 A restaurant advertises that it serves "crispy and delicious" fried chicken. If another company has a trademark for "Crispy Delights Chicken," the first restaurant can likely claim the defense of:

descriptive use Easy
A. Nominative fair use
B. Descriptive fair use
C. Abandonment
D. The first sale doctrine

20 When a trademark becomes the common, everyday name for an entire category of goods (like 'aspirin' once was), the trademark may be lost. This is known as:

Defenses against trademark infringement Easy
A. Fair use
B. Genericization or genericide
C. Acquiescence
D. Laches

21 A new local coffee shop opens under the name 'Starbrews Coffee' using a green circular logo. Starbucks, the global coffee chain, sues for trademark infringement. Which of the following factors is most critical for the court to determine 'likelihood of confusion'?

unauthorized use and likelihood of confusion Medium
A. The defendant's intent to deceive and the high cost of Starbucks' coffee.
B. The number of employees at 'Starbrews Coffee' and its geographical location.
C. The defendant's registration of 'Starbrews Coffee' as a business name with the local authorities.
D. The similarity of the marks, the proximity of the goods, and the evidence of actual confusion.

22 A company starts selling a new line of budget athletic shoes under the brand name 'NIKEY', pronounced identically to 'NIKE'. If Nike sues, which aspect of trademark similarity will be their strongest argument for infringement?

unauthorized use and likelihood of confusion Medium
A. Phonetic similarity
B. Visual similarity
C. Connotative similarity
D. Conceptual similarity

23 A court finds that a company has willfully infringed upon a registered trademark and made substantial profits from the sale of counterfeit goods. In addition to a permanent injunction, what monetary remedy is the trademark owner most likely to be awarded?

remedies Medium
A. An account of the infringer's profits.
B. Only statutory damages, as actual damages are hard to prove.
C. Reimbursement for their original trademark registration fees only.
D. A nominal sum of $1 as a symbolic victory.

24 A defendant in an infringement lawsuit argues that the plaintiff, despite knowing about the defendant's use of a similar mark for six years, never objected and even did business with them. This conduct suggests the plaintiff implicitly approved of the use. What is the most appropriate legal defense to raise?

Defenses against trademark infringement Medium
A. Trademark exhaustion
B. Laches
C. Fair use
D. Acquiescence

25 An independent auto repair shop places a large sign outside that says 'We are experts in repairing BMW® cars'. BMW sues for trademark infringement. What is the repair shop's strongest defense?

use to indicate intended purpose of a product or services Medium
A. Parody
B. Prior use
C. Descriptive fair use
D. Nominative fair use

26 A retailer lawfully purchases genuine 'LUX' soap bars in India, repackages them from a multi-pack into individual wrappers with their own store branding alongside the 'LUX' mark, and sells them. The manufacturer of LUX sues for infringement. Why might the defense of exhaustion NOT apply here?

exhaustion Medium
A. Because the repackaging could degrade the product or confuse consumers about the source.
B. Because the retailer did not get written permission to resell the product.
C. Because LUX is a well-known trademark.
D. Because the principle of exhaustion only applies to exported goods.

27 A new brand of spring water is sold under the registered trademark 'AQUAFLOW'. A competitor launches a bottled water product and describes it on the label as having a 'pure, aqua flow'. If AQUAFLOW sues, what defense can the competitor claim?

descriptive use Medium
A. Nominative fair use
B. Geographical indication
C. Descriptive fair use
D. Acquiescence

28 A baker named Rohan Singh opens a small bakery called 'Singh's Bakery' in his hometown. A large, nationally recognized food corporation with the registered trademark 'SINGH FOODS' sues him for infringement. Which statement best describes the baker's legal position?

use of name or address Medium
A. He can only continue if he pays a royalty to 'SINGH FOODS'.
B. His only defense is to prove he was using the name before 'SINGH FOODS' registered its mark.
C. He can likely defend his use as a bona fide use of his own name, provided it doesn't cause excessive public confusion.
D. He has no defense because a registered trademark provides absolute nationwide protection against any similar name.

29 A trademark owner discovers that street vendors are selling counterfeit versions of its products, but the identities of the vendors are unknown. Which type of legal order would be most effective to stop this activity immediately?

remedies Medium
A. A John Doe order
B. A Mareva injunction
C. A permanent injunction
D. A claim for an account of profits

30 A small restaurant in Goa has been using the name 'Coastal Bites' since 1995. In 2015, a large corporation obtains a nationwide registration for the trademark 'COASTAL BITES' for restaurant services and asks the Goan restaurant to stop using the name. What is the Goan restaurant's best defense?

local use Medium
A. Rights of a prior user
B. The doctrine of exhaustion
C. Abandonment of the trademark by the corporation
D. Descriptive fair use

31 A company uses the famous 'Rolls-Royce' trademark in a television ad for its new economy car, with the tagline: 'You don't need a Rolls-Royce to experience luxury.' Rolls-Royce sues. What is the primary issue the court must analyze?

unauthorized use and likelihood of confusion Medium
A. Whether consumers are likely to believe the economy car is made by Rolls-Royce.
B. Whether the use tarnishes or dilutes the distinctive quality of the 'Rolls-Royce' mark.
C. Whether the ad uses the exact same font as the Rolls-Royce logo.
D. Whether the company using the mark also manufactures luxury goods.

32 A company files an application to register the trademark 'Innovate' and immediately starts using the 'Innovate®' symbol on its products. What is the legal implication of using the ® symbol before the trademark is officially registered?

use of registered trademark Medium
A. It is considered improper or fraudulent use, which can be grounds for the refusal of the application.
B. It is a recommended practice to claim rights early.
C. It is only illegal if a competitor uses the same mark.
D. It has no legal significance but is ethically questionable.

33 A company legally buys trademarked laptops in Japan, where they are sold cheaply. It then imports them into the European Union to sell at a profit, undercutting the trademark owner's authorized EU dealers. If the EU follows the principle of 'international exhaustion', what would be the likely outcome of an infringement suit?

exhaustion Medium
A. The suit would fail because the trademark owner's rights were 'exhausted' once the laptops were first sold anywhere in the world.
B. The suit would fail because laptops are considered essential goods.
C. The suit would succeed only if the laptops were modified in any way.
D. The suit would succeed because the trademark owner's rights are not exhausted outside the specific country of first sale.

34 A company is sued for trademark infringement. It argues that the plaintiff waited for eight years to file the lawsuit, during which time the defendant invested heavily in building its brand. The plaintiff was aware of the defendant's activities throughout this period. This defense is known as:

Defenses against trademark infringement Medium
A. Estoppel
B. Acquiescence
C. Unclean hands
D. Laches

35 In an infringement case, the court determines that the defendant was an 'innocent infringer' who had no knowledge that their mark was infringing on a registered trademark. How does this finding typically affect the remedies awarded to the plaintiff?

remedies Medium
A. The court will dismiss the case entirely as there was no wrongful intent.
B. The court will award punitive damages to deter future innocent infringers.
C. The court may deny an award of damages or profits but will likely still grant an injunction.
D. The court will only award the plaintiff's attorney fees.

36 A third-party company publishes a book titled 'A Guide to Mastering Adobe® Photoshop®'. The use of 'Adobe' and 'Photoshop' is challenged by Adobe. The publisher's best defense is that the use is:

use to indicate intended purpose of a product or services Medium
A. Necessary to identify the subject matter of the book (nominative fair use).
B. Acceptable because the book cover includes a disclaimer.
C. Permitted because the book is educational.
D. A descriptive use of the words 'Adobe' and 'Photoshop'.

37 The owner of the registered trademark 'WORLD'S BEST PIZZA' for restaurant services sues a small pizzeria that hangs a sign saying 'We make the world's best pizza'. Why is the pizzeria likely to succeed in its defense?

descriptive use Medium
A. The registered trademark 'WORLD'S BEST PIZZA' is likely invalid for being descriptive.
B. The phrase is laudatory puffery and descriptive, not being used as a trademark.
C. The pizzeria was the first to use the phrase in its local area.
D. Pizza is a generic food item and cannot be trademarked.

38 A manufacturer sells high-end car cleaning kits under the registered mark 'GLEAM'. A new company begins selling cheap industrial degreasers under the mark 'GLEEM'. Which factor would weaken GLEAM's infringement claim the most?

unauthorized use and likelihood of confusion Medium
A. There is some anecdotal evidence of consumers asking if the two companies are related.
B. The 'GLEEM' logo uses a font similar to the 'GLEAM' logo.
C. The 'GLEAM' trademark is highly distinctive and well-known.
D. The products are sold in different trade channels (e.g., auto-shops vs. industrial suppliers).

39 A company in the town of Darjeeling starts selling tea under the name 'Darjeeling's Own Tea'. The Darjeeling Tea Association, which manages the 'Darjeeling' Geographical Indication (GI), objects. What principle limits the company's ability to use its place of business as a brand name in this case?

use of name or address Medium
A. The doctrine of exhaustion prevents the use of the name.
B. The name is a protected Geographical Indication which functions as a community trademark.
C. The company did not get permission from the local municipal council.
D. The company's name is not descriptive enough.

40 Company A and Company B have been using the similar trademark 'SUNRISE' for different types of breakfast foods in different regions of the country for decades, both in good faith and without knowledge of the other. Company A is the first to obtain a federal registration. When Company A expands into Company B's territory, what doctrine might allow Company B to continue using the mark in its original territory?

use of registered trademark Medium
A. Trademark exhaustion
B. Nominative fair use
C. Honest concurrent use
D. Laches

41 A luxury car manufacturer, 'Elysian Motors,' discovers that a company is selling high-quality air fresheners shaped exactly like the Elysian car models under the brand 'Elysian Scents.' The goods are not in direct competition. In an infringement suit, what is the strongest argument for Elysian Motors to establish a likelihood of confusion?

unauthorized use and likelihood of confusion Hard
A. Initial interest confusion, because the product shape initially attracts car enthusiasts.
B. Similarity of the goods, as both relate to automobiles.
C. Evidence of reverse confusion, where consumers believe Elysian Motors is now in the air freshener business.
D. Post-sale confusion, where observers see the air freshener in a non-Elysian car and mistakenly associate that car's owner with the Elysian brand, diluting the mark's exclusivity.

42 A company is found liable for willful trademark infringement over a period of five years. The plaintiff proves its own lost sales (actual damages) amounted to $500,000. The defendant's profits from the infringing product are calculated to be $400,000. The relevant statute allows for recovery of defendant's profits, any damages sustained by the plaintiff, and costs. In cases of willful infringement, the court may award up to three times the amount of actual damages or profits, whichever is greater. What is the maximum potential monetary award the court can grant, excluding costs and attorney's fees?

remedies Hard
A. $1,900,000 (treble actual damages plus defendant's profits)
B. $1,500,000 (treble actual damages)
C. $1,200,000 (treble defendant's profits)
D. $900,000 (plaintiff's actual damages plus defendant's profits)

43 A U.S. company, 'Global Gadgets,' sells its 'Connecta' smartwatches with a 2-year U.S.-only warranty and specific U.S. power adapters. An importer buys genuine 'Connecta' watches in Asia (where they are sold with a 1-year international warranty and Asian power adapters) and sells them in the U.S. market at a lower price. Global Gadgets sues for trademark infringement. What is the importer's weakest argument against the infringement claim?

exhaustion Hard
A. The exhaustion doctrine applies because the goods are genuine and were placed into the stream of commerce by the trademark owner.
B. The importer provides its own third-party warranty and a U.S. power adapter, curing any material difference.
C. The differences in warranty and power adapters are trivial and do not constitute a 'material difference' that would confuse consumers.
D. The U.S. consumers are not confused because they are knowingly purchasing a 'gray market' product for a lower price.

44 A small startup, 'Innovate Inc.', began using the mark 'NEXUS' for its software in 2018. The well-known tech giant 'GlobalCorp' had been using 'NEXUS' for hardware since 2010 but was aware of Innovate Inc.'s use and chose not to act, as they were in different markets. In 2023, GlobalCorp launches a software line under the 'NEXUS' brand and sues Innovate Inc. for infringement. Innovate Inc. claims the defense of acquiescence. What factor is most critical for GlobalCorp to overcome this defense?

Defenses against trademark infringement Hard
A. Proving that Innovate Inc. acted in bad faith by adopting the well-known mark.
B. Establishing the incontestable status of their own 'NEXUS' trademark registration.
C. Showing that their delay in suing was less than the statute of limitations for infringement.
D. Demonstrating that while they acquiesced to the use for the original software, the inevitable confusion resulting from both companies now being in the software market vitiates the defense.

45 A third-party company creates a highly detailed, paid mobile app called 'The Ultimate Guide for TESLA cars,' which uses the 'TESLA' word mark extensively and includes high-resolution photos of TESLA vehicles. The app is not affiliated with TESLA. In a suit by TESLA, the developer claims nominative fair use. Which of the following facts, if true, would most severely weaken the developer's nominative fair use defense?

use to indicate intended purpose of a product or services Hard
A. The app contains some minor factual inaccuracies about the vehicle specifications.
B. The app's icon and splash screen feature the 'TESLA' word mark in a font and style identical to TESLA's official logo, making it the most prominent feature.
C. The developer generates significant revenue from selling the app.
D. The app is only available on platforms that compete with TESLA's own infotainment system.

46 The company 'Sweet & Salty' holds a registered trademark for its brand of kettle corn, which has acquired secondary meaning. A new competitor, 'PopCo,' launches a kettle corn product in a bag that prominently features the phrase 'A Perfect Sweet & Salty Taste!' in large, stylized letters at the top. 'Sweet & Salty' sues for infringement. What is PopCo's most challenging hurdle in asserting a classic fair use defense?

descriptive use Hard
A. Arguing that the plaintiff's mark is merely descriptive and should not have been registered.
B. Proving that the term 'sweet & salty' is descriptive of a flavor profile.
C. Demonstrating they did not intend to confuse consumers.
D. Showing that their use of the phrase was 'otherwise than as a mark,' despite its prominent and stylized placement on the packaging.

47 Since 1995, 'Bella's Bistro' has operated a single restaurant in rural Oregon. In 2010, a large corporation obtained a federal registration for 'BELLA'S BISTRO' for restaurant services and began opening locations nationwide. The corporation is now aware of the Oregon restaurant. Under the doctrine of prior use, what is the most accurate description of the original 'Bella's Bistro's' rights?

local use Hard
A. They must stop using the name as the federal registration provides constructive notice and superior rights throughout the U.S.
B. They have superior rights and can force the corporation to rebrand nationwide.
C. They can expand their business naturally to neighboring states as their reputation grows, as they were the first user.
D. They are frozen to the geographic area and the specific services they offered at the time the federal registration was granted in 2010.

48 A small, artisanal coffee roaster named 'Starlight Brews' has been operating for a decade. A massive, multinational beverage company, 'GlobalBev,' launches a new energy drink called 'STARLIGHT' and blankets the market with advertising. Consumers start asking the coffee roaster if they were acquired by GlobalBev or have launched an energy drink. This scenario is a classic example of:

unauthorized use and likelihood of confusion Hard
A. Contributory infringement.
B. Standard forward confusion.
C. Reverse confusion.
D. Post-sale confusion.

49 An individual named Tiffany Lamar opens a jewelry store. The world-famous luxury brand 'Tiffany & Co.' sues her to prevent her from naming her store 'Tiffany's Fine Jewelry.' Assuming Ms. Lamar is acting in good faith, what is the most likely outcome of a court's analysis of her defense of using her own name?

use of name or address Hard
A. The court will likely grant a qualified injunction, allowing her to use her name but requiring a disclaimer of affiliation, such as 'Not affiliated with Tiffany & Co.'
B. The defense will fail completely, as the 'Tiffany' mark is too famous to permit any similar use in the jewelry market.
C. The court will permit the use of her full name, 'Tiffany Lamar Jewelry,' but not the possessive form 'Tiffany's.'
D. The defense will be absolute, as using one's own name is a fundamental right.

50 A plaintiff in a trademark infringement case successfully proves infringement but cannot establish any of its own actual damages or any of the defendant's profits. The defendant's infringement was found to be non-willful, resulting from a good-faith mistake. What remedy is the plaintiff most likely to be awarded by the court?

remedies Hard
A. A reasonable royalty.
B. Punitive damages.
C. A permanent injunction.
D. Statutory damages.

51 A company purchases lawfully-made, genuine 'BrandX' widgets in bulk. The widgets are sold by BrandX in packs of 10. The company repackages them into individual units for resale, placing each widget in a new, unbranded box. BrandX sues for infringement. The company claims the first sale doctrine (exhaustion) as a defense. Why is this defense likely to fail?

exhaustion Hard
A. Because the first sale doctrine only applies to copyrighted works, not trademarks.
B. Because the defendant did not get a license from BrandX to resell the products.
C. Because the repackaging creates a risk of consumer confusion about the source and quality of the product, as it is no longer in its original BrandX-certified packaging.
D. Because the defendant is reselling the product for a profit.

52 A political satire group creates t-shirts featuring the 'Coca-Cola' logo, but with the script altered to read 'Capitalism.' The colors and overall design closely mimic the famous brand. Coca-Cola sues for infringement and dilution. The group claims parody as a defense. Which factor is most crucial for the success of their parody defense?

Defenses against trademark infringement Hard
A. Whether the t-shirt is sold for profit or given away for free.
B. Whether the group obtained a legal opinion before creating the t-shirts.
C. Whether Coca-Cola can prove that some consumers were momentarily confused about the source of the t-shirt.
D. Whether the message is a commentary on Coca-Cola itself, or using Coca-Cola to comment on capitalism in general.

53 A website, 'FindAPart.com,' allows users to search for car parts. When a user searches for 'ACME brake pads,' the site returns a result that says 'No ACME brake pads found. We recommend AJAX brake pads' with a link to the AJAX product. ACME sues FindAPart.com for trademark infringement, arguing initial interest confusion. What is the strongest defense for FindAPart.com?

unauthorized use and likelihood of confusion Hard
A. The website is providing a useful service to consumers by offering an alternative.
B. FindAPart.com does not sell the products directly but is merely an intermediary.
C. AJAX brake pads are of a higher quality than ACME brake pads.
D. The results clearly state that the ACME product is not available and explicitly name the alternative, dispelling any potential confusion before a purchase is made.

54 A newspaper publishes a critical review of the new 'Phantom X' smartphone. The article is titled 'Phantom X Fails to Impress' and includes a clear, high-resolution photo of the phone, with the 'Phantom X' logo visible. The phone's manufacturer sues the newspaper for infringement. The newspaper's nominative fair use defense would be most likely to fail if which of the following were true?

use to indicate intended purpose of a product or services Hard
A. The 'Phantom X' logo in the article's headline was displayed in a much larger font and with more prominence than the newspaper's own masthead.
B. The newspaper also runs paid advertisements for the Phantom X's main competitor.
C. The photograph of the phone was one provided by the manufacturer in a press kit.
D. The newspaper's review was overwhelmingly negative and caused the manufacturer's stock price to fall.

55 'WORLD'S BEST COFFEE' is a registered trademark on the supplemental register for a brand of coffee beans, as it is highly descriptive. A competing coffee shop puts up a sign that says 'Come try our coffee - voted the World's Best Coffee by the Downtown Gazette!' Assuming the claim about the newspaper is true, what is the coffee shop's strongest defense against an infringement claim?

descriptive use Hard
A. The First Amendment protects their right to commercial speech.
B. The trademark is only on the supplemental register, which provides no right to sue for infringement.
C. The use is a classic fair use because it is truthfully describing a quality of their product (award-winning).
D. The trademark is invalid because it is merely descriptive.

56 After a lengthy trial, a defendant is found to have infringed on a trademark. The plaintiff, the trademark owner, had delayed bringing the lawsuit for several years despite knowing about the infringement. The defendant successfully raises the defense of laches. How does a successful laches defense typically impact the remedies available to the plaintiff?

remedies Hard
A. It typically bars the recovery of monetary damages for past infringement but may still allow for an injunction to prevent future infringement.
B. It completely bars all remedies, leading to a dismissal of the case.
C. It allows the defendant to continue infringing but requires them to pay a court-ordered royalty to the plaintiff.
D. It has no effect on remedies but reduces the defendant's court costs.

57 A bakery named 'Sweet Dreams' has operated in Phoenix, Arizona since 2005. A national chain, also named 'Sweet Dreams,' obtained federal registration in 2012 and has stores in every state except Arizona. The national chain now plans to acquire a local bakery chain in Phoenix and rebrand all its locations as 'Sweet Dreams.' What is the most likely legal outcome?

local use Hard
A. The local 'Sweet Dreams' must pay a licensing fee to the national chain to continue operating.
B. The national chain can force the local bakery to cease using the name due to its superior federal rights.
C. The two can co-exist, but the local 'Sweet Dreams' may be able to prevent the national chain from opening a store in its immediate neighborhood if it causes direct confusion.
D. The local 'Sweet Dreams' can completely block the national chain from entering the Phoenix market.

58 A U.S. video game publisher sells 'Collector's Editions' of its games, which include a physical disc and a unique, single-use code for downloadable content (DLC). A reseller buys these editions, opens them, sells the physical disc, and sells the DLC code separately online. The publisher sues for trademark infringement. Which legal principle best supports the publisher's claim?

exhaustion Hard
A. The exhaustion doctrine, because the initial sale of the Collector's Edition exhausted the publisher's trademark rights.
B. The 'material alteration' exception to the first sale doctrine, because unbundling the components and selling them separately alters the product from what the consumer expects under the trademark.
C. Contributory infringement, as the reseller is contributing to copyright infringement by the users of the DLC codes.
D. The fair use doctrine, as the reseller is merely describing the content they are selling.

59 A company has an incontestable federal trademark registration for the mark 'AURA' for lamps. A competitor begins selling light bulbs under the name 'AURA.' In an infringement lawsuit, what is the primary effect of the incontestable status of the plaintiff's mark?

use of registered trademark Hard
A. It prevents the defendant from using the mark anywhere in the United States, regardless of the goods they sell.
B. It conclusively establishes the validity of the mark and the plaintiff's ownership, and that the mark has secondary meaning, narrowing the defendant's available defenses.
C. It automatically proves that there is a likelihood of confusion between the two products.
D. It shifts the burden of proof to the defendant to prove that their product is not infringing.

60 A defendant in a trademark infringement lawsuit is found to have copied the plaintiff's trademark with the explicit intent to trade on the plaintiff's goodwill. Despite this, the defendant argues that there can be no infringement because the plaintiff has presented no evidence of any actual consumer being confused. What is the likely judicial response to this argument?

Defenses against trademark infringement Hard
A. The court will dismiss the case based on the 'de minimis non curat lex' (the law does not concern itself with trifles) principle.
B. The court will agree, as proof of actual confusion is a required element for any trademark infringement claim.
C. The court will find infringement but will be unable to award any monetary damages due to the lack of evidence of confusion.
D. The court will find that a showing of bad faith intent creates a presumption of likelihood of confusion, which the defendant must then rebut.
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