Trademark Cases Summaries Federal Bar Association Webinar March 6, 2013 Wahab & Medenica LLC 125 Maiden Lane, Suite 208 New York, NY Tel: (212) Fax: (646)

Topics covered: Commercial Use; Fair Use; “Artistic” Use; Famous Marks – Insufficient Pleadings; Famous Marks – Insufficient Evidence; Naked Licensing; Overlap between the Lanham Act and the FDCA; Declaratory Judgment Actions; Keywords; Aesthetic Functionality; and Damages.

Commercial Use

New Look Party v. Louise Paris, 2012 U.S. Dist. LEXIS 9539 (S.D.N.Y. 2012) FACTS: Plaintiff is a fashion brand headquartered in England. P used “NEW LOOK” in the UK since 1969 for the sale of clothing. P developed stylized logo of “NEW LOOK” in 2002; started using it in 2003.

Defendant is US based; also sells clothing. D filed for “NEW LOOK” standard character mark on May 22, 2009; application granted on Sept. 21, While application pending, D uses “NEW LOOK”. In Oct. 2010, D files for registration of “NEW LOOK” stylized mark. P starts selling in the U.S. as of July P files complaint against D in June 2011, moves for a preliminary injunction, and seeks to cancel D’s mark.

PI Standard: A party seeking a preliminary injunction must show: (1) likelihood of success on the merits; (2)likelihood of irreparable harm in the absence of the injunction; (3)balance of hardships tipping in the movant’s favor; and (4)the public interest is not disserved by the issuance of the injunction.

To succeed on a claim for infringement of an unregistered trademark, plaintiff must show that (1) it has a valid mark that is entitled to protection under the Lanham Act; and that (2) the defendant used the mark, (3) in commerce, (4) in connection with the sale or advertising of goods or services, (5) without the plaintiff's consent," and (6) defendants' use of the mark is likely to cause confusion as to the connection between defendants' goods and plaintiff.

Use analogous to TM use Such “use analogous to trademark use” is sufficient to constitute prior use only where it is "of such a nature and extent that the mark has become popularized in the public mind so that the relevant segment of the public identifies the marked goods with the mark's adopter." Am. Express Co. v. Goetz, 515 F.3d 156, (2d Cir. 2008) (internal quotation marks omitted).

Holding: Preliminary Injunction denied because P could not demonstrate use of the mark U.S. commerce. Operation of a website that was viewed by U.S. customers, sales through international stores, and equity/debt sales in corporate entity insufficient to demonstrate commercial use.

Marshak v. Schaffner, 2012 U.S. Dist. LEXIS (S.D.N.Y. May 2012)

Parties: Defendant, “the Marvelettes,” were a famous Motown group from the 60s. Plaintiff was an editor at Rock Magazine during the 60s and he booked the Marvelettes for a performance. He subsequently went on to host a show entitled the “Marvellettes.”

Holding: Defendant the Marvelettes’ summary judgment motion was granted. Plaintiff could not demonstrate that he was the senior user of the mark because Defendant never abandoned the mark even if no longer performing live music. Radio play was sufficient to constitute use in commerce.

Common law trademark rights by senior user sufficient to defeat junior user’s trademark application. Self-laudatory terms in the 2 nd circuit can be found either descriptive or suggestive, but “Majestic” for pearls is suggestive. Perfect Pearl Co. v. Majestic Pearl & Stone, 2012 U.S. Dist. LEXIS (S.D.N.Y. Aug. 14, 2012)

Fair Use In a classic trademark fair use case, “the defendant has used the plaintiff's mark to describe the defendant's own product.” Playboy Enters. v. Welles, 279 F.3d 796, 801 n.10 (9th Cir. 2002) (internal quotations omitted; emphasis in original). In contrast, a nominative trademark fair use ("nominative use") case occurs when the defendant has used the trademarked term to describe the plaintiff's product, "even if the defendant's ultimate goal is to describe his own product.” Mattel Inc. v. Walking Mountain Prods., 353 F.3d 792, 809 (9th Cir. 2003) (internal quotations omitted; emphasis in original). The fair use defense, classic or nominative, applies when an allegedly infringing term is used (1) not as a trademark, but (2) fairly and in good faith (3) to describe the goods and services. Cairns v. Franklin Mint Co., 292 F.3d 1139, 1151 (9th Cir. 2002).

Car-Freshener Corp. v. Getty Images, Inc., 822 F. Supp. 2d 167 (N.D.N.Y., Sept. 27, 2011)

Holding: The court held it was “plausible” that Getty’s use of the tree image was not fair use. According to the court, the image used by Getty created an association between the tree mark and a “fresh scent” – which is exactly what Car Freshener is selling. Therefore Getty was relying upon the mark’s strength to convey a message.

Simone Kelly-Brown v. Oprah Winfrey, 2012 U.S. Dist. LEXIS (SDNY March 2012)

Holding: The Court dismissed all of Plaintiff’s federal claims and declined to exercise supplemental jurisdiction over Plaintiff’s state and common law claims. Use of the phrase “Own your Power” by Oprah was a non-trademark use because the magazine was clearly identified as the source of the goods.

Born to Rock Design, Inc. v. CafePress.com, Inc., 2012 U.S. Dist. LEXIS , (S.D.N.Y. Sept. 7, 2012)

Holding: The Court denied Defendant’s motion for summary judgment because some phrases were made in conjunction with guitar pictures, and therefore a jury might find it to be a trademark use.

Louis Vuitton Mallatier S.A. v. Warner Brothers Entertainment Inc., 868 F. Supp. 2d 172, 2012 U.S. Dist. LEXIS 83646, 2012 WL (S.D.N.Y. June 15, 2012)

Holding: Warner Brothers’ motion to dismiss with prejudice was granted, and Louis Vuitton was not granted an opportunity to amend its pleadings. The Second Circuit’s framework for artistic work is set out in Rogers v. Grimaldi, which provides that artistic works are protected under the First Amendment protections (and the Lanham Act will not apply), where the use of the trademark is both (1) artistically relevant to the work and (2) not explicitly misleading as to the source or content of the work. The court found that Warner Brothers’ use of the bag met the low threshold for “artistic relevance” for First Amendment protection particularly because the character Alan mispronounced the name as “Lewis Vuitton,” which added to his portrayal as socially inept. The use of the bag was intended to create an artistic association with the brand rather than as a commercially motivated use.

Famous Marks

Luv N' Care, Ltd. v. Regent Baby Prods. Corp., 841 F. Supp. 2d 753 (S.D.N.Y., January 10, 2012)

The Trademark Dilution Revision Act, 15 U.S.C. § 1125 (c) (2), provides: (A) For purposes of paragraph (1), a mark is famous if it is widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark's owner. In determining whether a mark possesses the requisite degree of recognition, the court may-consider all relevant factors, including the following: (i) The duration, extent, and geographic reach of advertising and publicity of the mark, whether advertised or publicized by the owner or third parties. (ii) The amount, volume, and geographic extent of sales of goods or services offered under the mark. (iii) The extent of actual recognition of the mark. (iv) Whether the mark was registered under the Act of March 3, 1881, or the Act of February 20, 1905, or on the principal register.

Holding: The court found that Plaintiff did not plead enough facts to support the assertion that its marks are famous and therefore granted Defendant’s motion to dismiss. The court further found that “at best” plaintiff had pleaded fame among baby product consumers – or niche fame. Niche fame is not sufficient for purposes of the TDRA.

Coach Services, Inc. v. Triumph Learning LLC, 668 F.3d 1356 (Fed. Cir. Feb. 21, 2012)

Holding: The Federal Circuit affirmed the TTAB’s finding of no likelihood of confusion. The Court also affirmed the TTAB’s finding that Applicant’s COACH mark was not likely to dilute Coach’s COACH mark because COACH did not submit sufficient evidence supporting their contention that at the time of Applicant’s filing COACH was a famous mark. The Court vacated and remanded the case, however, for further proceedings on the issue of whether Applicant’s COACH mark had acquired distinctiveness.

Naked Licensing

Eva's Bridal Ltd. v. Halanick Enterprises, Inc., 639 F.3d 788 (May, 7th Cir. 2011)

Holding: The court affirmed the district court’s dismissal of the suit based on naked licensing. Absolute failure to exert any quality control over a trademark licensee to ensure consistency in meeting consumers’ expectations will result in abandonment of the licensor’s trademark.

Registration Denial

In re Viterra Inc., 671 F.3d 1358 (Fed. Cir. March 6, 2012)

Holding: The Federal Circuit affirmed the TTAB’s refusal to register the mark XCEED, in standard character form, for agricultural seeds. The Court found that the mark would cause likelihood of confusion with registrant’s mark for X-SEED in special form as a word and design mark, consisting of a stylized letter X and surrounding dots in red and the term “-Seed” in black and outliend in grey.

Lanham Act and FDCA

Pom Wonderful LLC v. Coca-Cola Co., 679 F.3d 1170 (9th Cir. May 17, 2012)

Holding: The 9 th Circuit affirmed the district court ruling granting summary judgment to Coca-Cola because Plaintiff’s allegations required the Court to interpret the FDCA. “[T]he FDCA and its regulations barred pursuit of both the name and labeling aspects of Pom’s Lanham act claim.”

Declaratory Judgment Actions

Vina Casa Tamaya S.A. v. Oakville Hills Cellar, 784 F. Supp. 2d 391 (S.D.N.Y., April 26, 2011)

Holding: The Court granted Defendant’s motion to dismiss finding that Plaintiff had limited its objections to the registration of TAMAYA, and not its use. Accordingly, the TTAB was the appropriate forum for issues of registration. Under the totality of the circumstances test, the court found that Plaintiff had failed to show an “actual controversy” sufficient to establish federal jurisdiction pursuant to the Declaratory Judgment Act.

Already, LLC v. Nike, Inc., 184 L. Ed. 2d 553, 2013 U.S. LEXIS 602, 105 U.S.P.Q.2D (BNA) 1169, 23 Fla. L. Weekly Fed.S 549 (U.S. 2013).

Holding: The Second Circuit dismissed Defendant’s declaratory judgment counterclaim because there was no actual case or controversy before it. As for Defendant’s cancellation claim, the court also dismissed it because a claim for trademark cancellation is insufficient to support federal jurisdiction where a covenant not to sue has resolved the underlying infringement action. The Supreme Court affirmed the Second Circuit’s decision finding that Defendant had no standing.

Nat'l Bus. Forms & Printing, Inc. v. Ford Motor Co. 671 F.3d 526 (5th Cir. Feb. 16, 2012)

Holding: The Fifth Circuit reviewed the district court’s ruling that Plaintiff’s offering for sale of decals, stickers, banners, and license-plate frames to which Ford logos could be attached constituted trademark infringement, but noted that on appeal Plaintiff failed to “adequately target” any aspects of the district court’s grant of summary judgment that warranted reversal. Accordingly, the Fifth Circuit found that Plaintiff waived this issue on appeal, and therefore Plaintiff had infringed Defendant’s trademark by engaging in such activities.

Keywords

Rosetta Stone v. Google, 676 F.3d 144 (4th Cir. April 9, 2012)

Holding: The 4th Circuit vacated the summary judgment ruling as to Rosetta Stone’s direct infringement, contributory infringement, and dilution claims. Summary judgment is inappropriate in trademark infringement lawsuits related to keyword advertising where there is evidence of actual confusion and a jury could find intent to cause confusion.

Aesthetic Functionality

Louboutin v. Yves Saint. Laurent Am. Holding, Inc., 2012 U.S. App. LEXIS 18663, (2d Cir., Sept. 5, 2012)

Holding: The District Court found that Louboutin's trademark was likely not enforceable and declined to enter a preliminary injunction against YSL's use of the trademark. The district court further found that a single color can never serve as a trademark in the fashion industry (because of the aesthetic functionality doctrine). The Second circuit reversed that holding finding that a single color can serve as a trademark in the fashion industry, but that YSL’s monochromatic shoe did not infringe Louboutin’s red sole trademark.

Maker's Mark Distillery, Inc. v. Diageo N. Am., 679 F.3d 410 (6th Cir. May 9, 2012)

Holding: The district court awarded Maker’s Mark an injunction without damages, finding that Maker’s Mark had a valid trademark and that the Casa Cuervo’s red dripping wax seal was infringing. The Sixth Circuit found that the district court did not abuse its discretion and its findings were affirmed. A red dripping wax seal on a bottle is not barred from protection based on aesthetic functionality.

Damages

Gucci v. Guess, 2012 U.S. Dist. LEXIS (S.D.N.Y. May 21, 2012)

Holding: The court denied the bulk of Guess’ summary judgment motion but awarded only about $400,000 in damages to Gucci after a bench trial. Gucci was unable to produce any evidence on the issue of actual damages in the form of lost sales or harm to brand value, nor was Gucci able submit expert reports in the form of a reasonable royalty calculation.

Coach v. Sharon O’Brien, 2012 U.S. Dist. LEXIS (S.D.N.Y. April 2012) The magistrate judge issued a report and recommendation which awarded plaintiff approximately $13,000 in statutory damages for trademark infringement, as well as a default judgment and a permanent injunction. Plaintiffs challenged the report claiming they were entitled to infringement damages substantially greater than the damages included in the report. The Court granted Plaintiff’s request and modified the report by increasing the award to approximately $250,000. The report was based solely on the infringer’s apparently modest sales, however, it was not clear that the infringer’s disclosure of sales was complete, the infringement was willful, the well known marks for luxury items were valuable, and deterrence of the infringer and others warranted a significant award.