Amazon.com, Inc. in March launched the Amazon Appstore, prompting a trademark infringement lawsuit by Apple. The Amazon Appstore is a service that collects and distributes mobile applications for the Android mobile operating system, competing with the Google-developed Android Market to offer both free and paid application downloads. Though the service does not compete directly with Apple’s App Store because Apple maintains the only authorized application store for its devices, the service managed to get Apple’s attention in another way. This article will discuss briefly both the facts and the legal implications of this trademark dispute.

In July 2008, Apple filed for a U.S. trademark in the term “App Store” for “retail store services … on handheld digital devices” (trademark serial number 77525433). The application was approved despite opposition from Microsoft, which argued that the term could not be granted protection because it is generic. While this opposition is pending and Microsoft has decided to avoid the issue by calling its app store the “Windows Marketplace for Mobile,” Amazon has been undeterred.

On March 18, Apple filed suit for trademark infringement and dilution and unfair competition against Amazon for the latter’s use of the name “Appstore.” The suit alleges that though Apple was not the first to create a mobile applications store, it was the first to label one an “App Store.” Apple also alleges that it “has extensively advertised, marketed and promoted the App Store service … spending millions of dollars on print, television, and internet advertising,” and that “the enormous public attention given the App Store service, and the success of the service, have cemented the public’s identification of App Store as a trademark for Apple’s service.”

In order to show trademark infringement under either the federal Lanham Act or state common law, Apple must show that Amazon’s use of the term “Appstore” is likely to cause confusion in a reasonable consumer as to the source of the software. Here, the fact that Amazon has appended its name in front of the contested term, and that Amazon removed the space, may help the Internet retailer to argue that customer confusion will be limited. In order to show dilution of its mark, Apple must show first that its mark is famous and distinctive. Apple also must prove that Amazon diluted the mark either through blurring (impairing its distinctiveness) or tarnishment (harming its reputation).

In its response this week, Amazon argues that Apple’s claims are barred because “App Store” is generic and by the doctrine of fair use, relying on the Oxford English Dictionary’s definition of “app” as “[a]n application, esp. an application program.” They also argue that Apple has not suffered harm, or that if it has, the harm is uncertain and speculative.

In order to show that “App Store” is a generic term, Amazon must establish that it describes the general category to which its service belongs. If that is the case, the trademark will be invalidated and Apple’s suit will be dismissed. As an example, a manufacturer of pants could not obtain a trademark in the name “Pants” in connection with the sale of slacks. As evidence of the term’s genericness, Amazon points to a quotation from Apple’s Steve Jobs, in which he said that Apple’s app store is “the easiest-to-use, largest app store in the world…” In order to show that Apple’s claim is barred by the doctrine of fair use, Amazon must show that its service was not readily identifiable by another term, or that the term was used only to describe its service, rather than as an indication of source.

Even if Apple succeeds on all of the legal claims identified, ascertaining the damages suffered with accuracy will be difficult. Regardless, this should be an interesting issue to watch as it progresses between Microsoft and Apple (at the Patent and Trademark Office) and between Amazon and Apple (in the courts). The case could impact many tech companies who offer or plan to offer app stores for phones, computers, or other devices, including wireless service providers, device makers, and operating system vendors.