David Lilenfeld Blog The intellectual property blog of David Lilenfeld

1Feb/160

Trademark Office Rules Dumbbells and Soccer Goals Unrelated

The Trademark Office reversed a Section 2 (d) refusal to register the trademark QUIK-CHANGE for dumbbell systems finding the trademark is not likely to cause confusion with the already registered trademark KWIK CHANGE for soccer goals. Plaintiff, Hoist Fitness System, applied to register the trademark QUIK-CHANGE for exercise equipment, mainly a dumbbell system with a handle, weights and a stand.

KWICK CHANGE soccer goal

KWICK CHANGE soccer goal

Quick-Change dumbbell system

Quick-Change dumbbell system

The Examining Attorney refused to register the trademark QUIK-CHANGE because the trademark was merely identical in appearance and would be found in the same sporting goods market as the trademark KWIK CHANGE. Applicant pointed out that the trademarks are spelled differently and that the equipment for soccer and weight training are different.

Although the Trademark Office agreed with the PTO that the trademarks have the same meaning and pronunciation, the Trademark Office recognized the trademark is on the Supplemental Register, which is an admission that the trademark is descriptive. The Trademark Office therefore took into consideration the descriptiveness of the trademark as well as the fact that the applicant’s trademark is at least suggestive of the fact that its weight is subject to change.

The Trademark Office also considered the issue of whether the goods are related and if they are related how closely they are related. The Board pointed out the intent-to-use applications and the non-use based registrations are not entitled to much weight. The most pertinent registrations are use-based registrations but these appear to be house marks. Even though they may show there is some relationship between sporting goods, it is hardly evidence that goods as different as soccer goals and dumbbells are closely related.

Just because goods are sold in the same stores or on the same websites does not prove that the goods are related. Soccer and exercise products can be sold on the same website like e-bay without demonstrating that the sources of the products are associated or related.

In conclusion, based on the nature of the trademarks and the fact that the goods are not closely related, the Trademark Office held that confusion was not likely between the trademark QUIK-CHANGE and the registered trademark KWIK CHANGE.

1Feb/160

“Consumer degree of care” — another likelihood of confusion factor

Here we move on to the seventh factor in the likelihood of confusion (based on the 9th Circuit's view).  How much care do consumers pay when purchasing the respective products of the parties?

7.  Consumer degree of care

“In analyzing the degree of care that a consumer might exercise in purchasing the parties' goods, the question is whether a ‘reasonably prudent consumer’ would take the time to distinguish between the two product lines. Surfvivor Media, Inc., 406 F.3d at 634. “[T]he standard used by the courts is the typical buyer exercising ordinary caution.

[W]hen the goods are expensive, the buyer can be expected to exercise greater care in his purchases . . . .”  Network Automation, Inc., 638 F.3d at 1152.  Again, the parties present conflicting evidence as to the degree of care consumers of their products are likely to exercise. Top Shelf’s expert opines that kombucha is a “niche product” and that the price point of Clearly Kombucha is high enough, relative to other bottled beverages, to foster a relatively greater degree of care among consumers. (See Silverman Rep. ¶¶ 55-56.) Top Shelf’s founder testifies that its clients are particularly health-conscious, and therefore are more discerning when choosing bottled beverages. (Cargle Decl. ¶ 20.) On the other hand, Clearly Canadian points to evidence showing that Top Shelf’s beverages have been sold at a variety of price points, ranging on the low end from $1.50 to $3.00. (See Supp. Resp. at 12-13).

“With respect to small, inexpensive goods . . . the consumer is likely to exercise very little care.” Surfvivor Media, Inc, 406 F.3d at 634; see also CytoSport, Inc. v. Vital Pharm., Inc., 617 F. Supp. 2d 1051, 1076 (E.D. Cal. 2009) (finding a low degree of care with respect to bottled drinks costing between $3.00 and $5.00). A jury reviewing the parties’ evidence could reasonably find that consumers purchasing Clearly Canadian and Clearly Kombucha beverages exercise a low degree of care. Therefore, for the purposes of summary judgment, this factor weighs in Clearly Food’s favor.

30Jan/160

“Clearly Canadian” – Likelihood of Confusion – Similarity of Marketing Channels

2.  Marketing channels

Here, there is evidence that both companies market and sell their beverages over the Internet through their own websites, third party retail sites, and Facebook. (See Zarrow Dep. at 51:24-52:5; Cargle Dep. at 83:21-25; Khan Dep. at 46:12-19; 91:15-92: 95:8-15.) Yet, “[g]iven the broad use of the Internet today, the same could be said for countless companies.” Playboy Enterprises, Inc. v. Netscape Commc'ns Corp., 354 F.3d 1020, 1028 (9th Cir. 2004). “Some use of the Internet for marketing . . . does not alone and as a matter of law constitute overlapping marketing channels.” Entrepreneur Media, Inc., 279 F.3d at 1151.

The parties hotly contest whether the two products would typically be stored in the same shelves, aisles, or general areas of a retail store. (See Mot. at 22 (contending that Clearly Kombucha must be located in the refrigerated section); Supp. Resp. (Dkt. # 94) at 10-11 (contending that Clearly Kombucha appears on warm shelves).) Because the court  must weigh the facts in the light most favorable to Clearly Food, the court assumes for the purposes of this motion that retail stores would choose to display Clearly Kombucha products near Clearly Canadian products more often than not, which weighs in favor of finding of likelihood of confusion. (See Billick Decl. Ex. I (restocking notes from 2013 showing that retail stores stocked Clearly Kombucha on warm shelves and next to bottled  water products such as Perrier, Smart Water, Vitamin Water, Evian, and Fiji, as well as next to flavored beverages such as Snapple and Sobe), Ex. J.) The significance of the potential adjacent storage, however, is blunted by the fact that Clearly Canadian is not currently sold in any brick and mortar retail stores. Clearly Food has recently engaged a sales and marketing company to market Clearly Canadian “to the top twenty-five grocery store chains across the United States,” and expects that Clearly Canadian will be sold in unspecified grocery stores in 2015. (2d Khan Decl. ¶¶ 3, 5.) However, it remains unclear     whether Clearly Canadian will be sold in similar retail stores as Clearly Kombucha, or in the same geographic region as Clearly Kombucha, in the near or intermediate future.  (See Zarrow Dep. at 27:21-28 (explaining that Clearly Kombucha was sold in limited

In sum, a reasonable jury could not find that the parties’ current marketing  channels “overlap to any significant degree.” See Entrepreneur Media, Inc., 279 F.3d at 1151. Future overlap, although possible, is speculative, and the minor existing overlap in Internet use is insignificant because the “shared use of a ubiquitous marketing channel does not shed much light on the likelihood of consumer confusion,” Network Automation, Inc. v. Advanced Sys. Concepts, Inc., 638 F.3d 1137, 1151 (9th Cir. 2011). Therefore, the court finds that this factor merits little weight in the likelihood of confusion analysis, and what weight it does merit benefits Top Shelf. Id.

3.  Relatedness of the goods

“Related goods are generally more likely than unrelated goods to confuse the public as to the producers of the goods.” GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1207 (9th Cir. 2000). “Related goods are those products which would be reasonably thought by the buying public to come from the same source if sold under the same mark.” Entrepreneur Media, Inc., 279 F.3d at 1147. The Ninth Circuit applies “a sliding scale approach as to the weight that relatedness will carry dependent upon the strength of the trademark holder’s mark.” Entrepreneur Media, Inc., 279 F.3d at 1147.

Clearly Food identifies the following undisputed similarities between the two products. To begin with the obvious, Clearly Canadian and Clearly Kombucha are single-serve, bottled beverages. (See Ledden Decl. Ex. 21.) Moreover, both products are  “sparkling” (carbonated) beverages, and are marketed as such. (See Dkt. # 47-4 (2014 presentation to Clearly Canadian investors); Billick Decl. (Dkt. # 95) Ex. A (a December,  2010 “Gourment California Foods Product Brief” identifying Clearly Kombucha’s “core position” as a “lightly sparkling” beverage), Ex. B (2009 business plan to market Top Shelf Kombucha as “the world’s first luxury sparkling elixir”), Ex. C (October 2013 email from Ms. Zarrow to a potential distributor describing Clearly Kombucha as a “sparkling, fermented, nonalcoholic tea”), Ex. D (2013 business plan describing Clearly Kombucha as a “sparkling fermented tea”), Ex. E, Ex. F at 3, Ex. G (“Brand Ambassador” handbook instructing marketers demonstrating Clearly Kombucha in retail stores to “[a]sk EVERY person that walks by if they would like a sample of  ‘sparkling tea’” unless the person already had kombucha in his or her cart).) Additionally, both products are “clear” beverages, and are marketed as such. (See Cargle Dep. (Dkt. # 57-3)

Finally, both products are perceived as healthy alternatives to other carbonated beverages, such as soda, and marketed as such. (See Ledden Decl. Ex. 8 (“2007 Survey”); Dkt. # 47-4 (2014 presentation to Clearly Canadian investors); 2012 Bus. Plan; Billick Decl. Ex. D (Clearly Kombucha 2013 business plan) at 9), Ex. E (notes from a Clearly Kombucha marketing demonstration).

Top Shelf points out that Clearly Kombucha differs from Clearly Canadian in that it is a flavored fermented tea rather than flavored water. (See Mot. at 22.) Top Shelf attempts to further distinguish the products by emphasizing the affirmative health benefits allegedly associated with kombucha, as well as the fact that Top Shelf targets a “niche” health-conscious demographic. (See Mot. at 21-23.) However, “the relatedness of each company’s prime directive isn’t relevant.” Brookfield Commc’ns, Inc. v. W. Coast Entm’t Corp., 174 F.3d 1036, 1056 (9th Cir. 1999). Rather, “the focus is on whether the consuming public is likely somehow to associate [the alleged infringer’s]  products with [the mark owner].” Id.see also Am. Int’l Group, Inc. v. Am. Int’l Bank, 926 F.2d 829, 832 (9th Cir. 1991).

Viewing the evidence in the light most favorable to Clearly Food, the court concludes that a jury could reasonably find that the consuming public is likely to associate the Clearly Kombucha product with the Clearly Canadian brand. The thrust of  Top Shelf’s argument is that the two brands do not directly compete for customers. But  even if a jury concluded that the two brands do not directly compete, a jury could still  reasonably find that the similarity of their products—namely, clear, sparkling, single-serve beverages—would likely result in consumer confusion between the brands and products. See American Int’l Group, Inc., 926 F.2d at 832 (concluding that although the parties were not direct competitors, customer confusion could result in light of the similarities between the financial services offered by the parties). Therefore, for summary judgment purposes, this factor weighs in Clearly Food’s favor.

30Jan/160

“Clearly Canadian” — Fraud on Trademark Office Analysis

In this blog post, David Lilenfeld breaks down the fraud section of the "Clearly Canadian" trademark infringement opinion. Defendant, Top Shelf, alleged that Plaintiff committed fraud on the Trademark Office, and therefore Plaintiff's trademark registration is not valid.  As discussed below, the Court rules that this is a jury question.

D.         Fraud

Top Shelf contends that Clearly Canadian’s trademark registration should be cancelled for fraud. (Mot. at 12-14.) A party who believes it has been harmed by a trademark’s registration may seek the cancellation of that trademark’s registration on certain specified grounds, including that the trademark was obtained by the commission of fraud on the United States Patent and Trademark Office (“Trademark Office”).  U.S.C. § 1064; see also 15 U.S.C. § 1119 (David Lilenfeld: This is a Cancellation Proceeding). “In any action involving a registered mark the court may . . . order the cancelation of registrations . . . .”). “When a trademark’s registration is cancelled, its owner is no longer entitled to the rights that flow from federal registration, including the presumption that the mark is valid.” Hokto Kinoko Co. v. Concord Farms, Inc., 738 F.3d 1085, 1097 (9th Cir. 2013)

(David Lilenfeld: here are the prima facie elements of a fraud claim) To succeed on a claim for cancellation based on fraud, Top Shelf “must adduce  evidence of (1) a false representation regarding a material fact; (2) the registrant’s  knowledge or belief that the representation is false; (3) the registrant’s intent to induce reliance upon the misrepresentation; (4) actual, reasonable reliance on the misrepresentation; and (5) damages proximately caused by that reliance.” Id. (citing Robi v. Five Platters, Inc., 918 F.2d 1439, 1444 (9th Cir. 1990)). (David Lilenfeld: A false representation in the original trademark application or an affidavit accompanying a renewal application may be grounds for cancellation if all five requirements are met. Id. Top Shelf, however, “bears a heavy burden of demonstrating that a trademark should be cancelled.” Id.see also Robi, 918 F.2d at 1444).

Top Shelf bases its fraud claim on the declaration by Clearly Food’s Chief Executive Officer, Robert Kahn, that accompanied the June 28, 2012, application to  renew the Clearly Canadian trademark. (See Mot. at 12-14.) (David Lilenfeld: As required by Section 8 of the Lanham Act, Mr. Kahn declared that the Clearly Canadian trademark “is in use in commerce on or in connection with the goods and/or services identified above, as evidenced by the attached specimen(s) showing the mark as used in commerce.”) (Request Ex. F (“Renewal”).) Mr. Kahn attached as a specimen a photograph of an empty plastic bottle of Clearly Canadian peach-flavored sparkling water. (See id.) This beverage had been purchased in Michigan in 2011 by an affiliate of Mr. Khan. (Khan Dep. 58:5-60:25.)

For the same reasons discussed in the preceding section, the court finds that questions of fact preclude a finding as to whether the Clearly Canadian trademark was in fact in use in commerce as of June 2012. See supra § III.C. Because Top Shelf cannot prove the first element—namely, that Mr. Kahn’s declaration contained a false representation regarding a material fact—summary judgment is inappropriate on this claim. See Celotex, 477 U.S. at 324. (David Lilenfeld: The Court isn't convinced yet).

Even assuming that the statement that the Clearly Canadian trademark was in use in commerce in June 2012 was false, Top Shelf fails to establish the second and third elements of fraud. “Deception must be willful to constitute fraud.” In re Bose Corp., 580  F.3d 1240, 1243 (Fed. Cir. 2009); see also Far Out Prods., Inc. v. Oskar, 247 F.3d 986, 996 (9th Cir. 2001) (holding that a trademark owner “can only be adjudicated to have filed a fraudulent [incontestability affidavit] if he acted with scienter”). (David Lilenfeld: again, a high burden for defendant to reach).

Mr. Kahn testified in deposition that, although he knew Clearly Food itself was not manufacturing  (David Lilenfeld: federally registered trademarks remain in force for 10 years; between the 9th and 10th year of registration, an owner must file a renewal application under Section 9 of the Lanham Act, which must be accompanied by a Section 8 declaration that the mark is in use in commerce.  See 15 U.S.C. §§ 1058) plastic bottles of Clearly Canadian beverages at the time he signed the declaration, he believed that the Clearly Canadian product was still being sold by third parties in commerce through 2011 (as shown by his affiliate’s then-recent purchase of the specimen bottle), and understood that such sales were sufficient to satisfy the Section 8 standard of use in commerce. (Khan Dep. 23:25-24:7; 61:1-25; 69:13-72:13.) As such, there are questions of fact as to whether Mr. Kahn knew the trademark was not being used in commerce as required by Section 8 and intended to mislead the Trademark Office as to that fact. (David Lilenfeld: sounds like the deposition of Mr. Kahn is in order). See In re Bose Corp., 580 F.3d at 1246 (finding that the registrant did not commit fraud when it filed a combined Section 8 and Section 9 affidavit stating that the trademark was in use in commerce where the registrant erroneously believed that the repairing of damaged previously sold goods and returning the repaired goods to the customers constituted use in commerce).

Top Shelf puts forth evidence suggesting that Mr. Kahn understood that Clearly Canadian itself needed to use the trademark in commerce in 2012 in order to avoid abandonment. (See, e.g. 10/2/12 Khan Email; 3/15/12 Khan Email; 12/22/11 Khan Email; Khan Dep. at 51:20-52:6.) The court, however, is not permitted to weigh the evidence or make credibility determinations at this stage. See Reeves, 530 U.S. at 150. (David Lilenfeld: the jury is supposed to decide questions of fact while the court decides questions of law).  Although deceptive intent may be inferred from indirect and circumstantial evidence, see In re Bose Corp., 580 F.3d at 1246, the court cannot say that a jury considering Top Shelf’s evidence could only reasonably find a willful intent to deceive. See Far Out Prods., Inc. v. Oskar, 247 F.3d 986, 996 (9th Cir. 2001) (finding that the defendants “did not even meet their initial burden in moving for summary judgment” because they “did not present any evidence of the affiant’s state of mind, including whether he acted in bad faith or with knowledge”). At trial, a jury may well find that Top Shelf has carried its “heavy burden” to show fraud. See Hokto Kinoko Co., 738 F.3d at 1097. (David Lilenfeld: there would need to be a number of helpful facts developed for Top Shelf to carry this burden). At this  juncture, however, the court finds that summary judgment is inappropriate. See Celotex,477 U.S. at 324; Hokto Kinoko Co., 738 F.3d at 1097 (declining to cancel a trademark for fraud where the challenger “adduced no evidence that [the registrant] knew of the misstatement . . . or intended to defraud the [Trademark Office]”).

 

30Jan/160

“Clearly Canadian” Trademark Opinion (part 2.) – trademark abandonment

In this post, David Lilenfeld continues to break down the court's opinion in trademark infringement case pitting CLEARLY CANADIAN v. CLEARLY KOMBUCHA.  This posts relates to the Court's opinion with respect to defendant's argument that plaintiff abandoned its CLEARLY CANADIAN trademark.

C.        Abandonment

(David Lilenfeld: a rare discussion on trademark abandonment). “To prove abandonment of a mark as a defense to a claim of trademark infringement, a defendant must show that there was: ‘(1) discontinuance of trademark use and (2) intent not to resume such use.’”Wells Fargo & Co. v. ABD Ins. & Fin. Servs., Inc., 758 F.3d 1069, 1072 (9th Cir. 2014), as amended (Mar. 11, 2014) (quoting  Electro Source, LLC v. Brandess-Kalt-Aetna Grp., Inc., 458 F.3d 931, 935 (9th Cir. 2006)); see also 15 U.S.C. § 1127(1). Non-use for three consecutive years constitutes prima facie evidence of abandonment. Herb Reed Enterprises, LLC v. Fla. Entm’t Mgmt., Inc., 736 F.3d 1239, 1247-48 (9th Cir. 2013); 15 U.S.C. § 1127(1). (David Lilenfeld: critical point here, since the term of non-use by plaintiff appears to be three years (2012-2015)). In the Ninth Circuit, non-use for three consecutive years creates only a rebuttal presumption of abandonment—it does not shift the burden of proof to the trademark owner. Abdul-Jabbar v. Gen. Motors Corp., 85 F.3d 407, 411 (9th Cir. 1996). A trademark owner can rebut the presumption of abandonment by showing valid reasons (David Lilenfeld: showing valid reason won't be hard here (bankruptcy)) for non-use or lack of intent to abandon the mark. Id.

“The standard for non-use is high.” Herb Reed Enterprises, LLC, 736 F.3d at 1247-48. “Non-use requires ‘complete cessation or discontinuance of trademark use.’” (quoting Electro Source, LLC, 458 F.3d at 936). The phrase “trademark use” means use that “includes placement on goods sold or transported in commerce; is bona fide; is made in the ordinary course of trade; and is not made merely to reserve a right in a mark.”1  Electro Source, LLC, 458 F.3d at 936 (quoting 15 U.S.C. § 1127). Even a “single instance of use is sufficient against a claim of abandonment of a mark if such use is made in good faith.” Wells Fargo & Co., 758 F.3d at 1072 (quoting Carter-Wallace, Inc. v. Procter & Gamble Co., 434 F.2d 794, 804 (9th Cir. 1970)).  (David Lilenfeld: the bar to prove trademark abandonment is set high, but Top Shelf might still prevail on lack of likelihood of confusion).

Evaluating whether a use is in “the ordinary course of trade” is “often an intensely factual undertaking.” Electro Source, LLC, 458 F.3d at 940. Courts must consider the “totality of the circumstances” to determine if genuine, albeit limited usage of the mark occurred “in the ordinary course of trade.” Id.Wells Fargo & Co., 758 F.3d at 1072.

(David Lilenfeld: Relevant factors include the “genuineness and commercial character of the activity, the determination of whether the mark was sufficiently public to identify or distinguish the marked [products] in an appropriate segment of the public mind as those of the holder of the mark, the scope of the [trademark] activity relative to what would be a commercially reasonable attempt to market the service [or product], the degree of ongoing activity of the holder to conduct the business using the mark, [and] the amount of business transacted.”)

Although “bona fide” is not defined in Section 1127, the Ninth Circuit has noted that “Black’s Law Dictionary provides two similar definitions for ‘bona fide’: ‘1. Made in good faith; without fraud or deceit. 2. Sincere; genuine.’” Electro Source, LLC, 458 F.3d at 936 (quoting Black’s Law Dictionary at 186 (8th ed. 2004)). The Ninth Circuit has also noted that “the term ‘bona fide’ in common parlance means ‘made or carried out in good faith; sincere.’”  Id. (quoting The American Heritage College Dictionary 158 (3d. ed. 2000)).

Because abandonment of a trademark is “in the nature of forfeiture, [it] must be strictly proved.” FreecycleSunnyvale v. Freecycle Network, 626 F.3d 509, 515 (9th Cir. 2010).  (David Lilenfeld: again, setting the bar highly for Top Shelf). The Ninth Circuit has not determined whether this high standard of proof requires“clear and convincing” evidence or a “preponderance of the evidence.” Id.see Grocery Outlet Inc. v. Albertson’s Inc., 497 F.3d 949, 954 (9th Cir. 2007) (separate concurrences disagreeing as to the applicable standard of proof). The court need not decide which standard of proof applies here because, viewing the evidence in the light most favorable  to Clearly Food, Top Shelf fails to carry its burden under either standard.(David Lilenfeld: the court bangs the gavel on Top Shelf's trademark abandonment argument). See Freecycle Sunnyvale, 626 F.3d at 515 (declining to decide which standard applied to a motion for summary judgment);Electro Source, LLC, 458 F.3d at 936 (same).

a.  Relevant facts (David Lilenfeld: facts pertinent to trademark abandonment ruling).

Top Shelf contends that the Clearly Canadian mark is presumptively abandoned because “there is no genuine dispute of material fact that there has not been any bona fide use of [the Clearly Canadian trademark] from 2008 to the present day.” (Mot. at 17.)

The relevant facts, taken in the light most favorable to Clearly Canadian, Reeves, 530 U.S. at 150, are as follows. CC Beverage’s last full-scale production run of beverages bearing the Clearly Canadian trademark occurred sometime in 2009. (Ledden Decl. Ex. 8 (“6/3/14 Khan Email”); Ledden Decl. Ex. 9 (“12/22/11 Khan Email”).) On September 4, 2009, Clearly shipped 432 cases of Clearly Canadian 20-ounce bottles to Paw Paw Wine Distributors (“Paw Paw”) in Michigan. (Bogen Decl. (Dkt. # 55) ¶ 5, Attach. A.) In turn, Paw Paw sold Clearly Canadian 20-ounce and 14-ounce beverages to retailers from 2009 through 2011. (Id. Attachs. B, C.) In an August 2009 transaction, GrayCo Sales Limited (“Grayco”), a beverages distributor in Ontario, Canada, sold approximately $225,000 worth of Clearly Canadian product to the retailer Big Lots. (Colley Dep. at 23:6-15; 24:19-25:3.)

Intrastate Distributors, Inc. (“Intrastate”), a beverage wholesale and manufacturing company located in Michigan, bottled Clearly Canadian product during 2011 and 2012.  (Dabish Decl. ¶¶ 2-3.) Graham Colley, the president of Grayco, maintained a trade booth at the Canadian National Exhibition in 2010 and 2011 featuring Clearly Canadian products. (2012 Bus. Plan. at 32-33 (“3/30/12 Colley Letter”).)  (David Lilenfeld: here the last use date by plaintiff was 2012).

(David Lilenfeld: court probably could have started fact discussion here since all that really matters at this point is plaintiff's date of last use of the trademark). In March, 2012, Graham Colley, the president of Grayco, negotiated a license with Clearly Food to sell Clearly Canadian beverages. (Colley Dep. at 32:22-33:1; 45:7-9; 47:15-23.) Under the license, Grayco was required to pay Clearly Food a royalty for  each case of product sold. (Id. at 46:10-47:8.) In 2012, Intrastate filled approximately 1,800 12-pack cases of 11-ounce bottles with Clearly Canadian product. (Dabish Decl. ¶ 5.) On August 14, 2012, Instrastate sold 1,872 cases of Clearly Canadian beverages (in raspberry and black cherry flavors) to Grayco. (Id. ¶¶ 5-6, Attachs. A, B.) The order totaled approximately $10,000.00, and was shipped to Grayco in Ontario, Canada, on August 15, 2012. (Id.; Colley Dep. at 33:15-18).) Grayco displayed and sold Clearly Canadian beverages during the 2012 Canadian National Exhibition. (3/30/12 Colley Letter.) This fair, which runs from mid-August to Labor Day, typically receives over 1.5 million attendees. (Id.) In October, 2012, Grayco sold 720 cases of Clearly Canadian beverages to an online retailer called  Beverages Direct, and transported the product to Beverages Direct in the United States. (Colley Dep. at 39:343:9; 66:11-24; 79:15-79; Khan Dep. at 79:21-80:6 (referencing a Grayco invoice dated October 23, 2012, to Beverages Direct).) In turn, Beverages Direct sold the Clearly Canadian product exclusively to retail purchasers located in the United States. (Colley Dep. at 91:6-92:4.)

In the summer of 2013, Intrastate sold another approximately $10,000.00 worth of Clearly Canadian product to Grayco. (Id. at 32:22-2; 67:1-17.) Grayco again sold several pallets worth of the beverage to Beverages Direct, and reserved the balance for the 2013 Canadian National Exhibition. (Id. at 67:1-17.)  (David Lilenfeld: so plaintiff's trademark continues in 2013 . . . different than the 2012 facts above).

Since then, Clearly Food’s 2014 online pre-sales campaign has generated over 10,000 orders, resulting in over 27,000 cases of product due to be shipped in 2015. (2d Khan Decl. ¶ 4.) Over 90% of those transactions are with customers in the United States.

Clearly Food has also received eight “full truckload” orders from seven different beverage distributors. (Id. ¶ 5.) As a result, Clearly Food will ship over 30,000 bottles of Clearly Canadian product in 2015. (David Lilenfeld: so we have only a two year or less period of non-use -- not going to be long enough to win for defendant). (Id.see also Billick Decl. Ex. N (invoices for the purchase orders).) Clearly Canadian will be sold directly to consumers at grocery stores  within those distributors’ networks. (2d Khan Decl. ¶ 5.)  Clearly Food has deployed various online, social media, and other marketing campaigns. (Khan Dep. at 46:12-19; 91:15-92:2; 95:8-15.)

b.  Application

Contrary to Top Shelf’s contention, Clearly Food’s evidence, viewed as a whole, shows that intermittent, yet appreciable commercial sales of Clearly Canadian beverages occurred from 2009 through the present. The court concludes that a jury considering this evidence could reasonably find that those sales are sufficient to preclude a finding that use of the trademark was discontinued. See Electro Source, LLC, 458 F.3d at 939  “Good faith nominal or limited commercial sales of trademarked goods are sufficient . . . to avoid abandonment[] where the circumstances legitimately explained the paucity of the sales.”) Specifically, a jury could find that the scope of trademark and business activity in which CC Beverage and Clearly Food engaged from 2009 to the present were commercially reasonable given the situation: namely, a brand transfer, during bankruptcy proceedings, by a declining business to a start-up company seeking to revitalize the brand. See Electro Source, LLC, 458 F.3d at 939 (finding no abandonment because a struggling business’s efforts to exhaust its remaining inventory prior to dissolution constituted “core trademark activities that necessarily contemplate trading upon the goodwill of the mark”). (David Lilenfeld: Even a “single instance of use is sufficient against a claim of abandonment of a mark if such use is made in good faith,” Wells Fargo & Co., 758 F.3d at 1072). Clearly Food puts forth evidence of multiple uses arguably made in good faith. Although Top Shelf adduces evidence suggesting that the sales made immediately after Clearly Food acquired the trademark were made solely for the purpose of preserving the mark, the court may not weigh the evidence on summary judgment. See Reeves, 530 U.S. at 150; (Ledden Decl. Ex. 4 (“10/2/12 Khan Email”), Ex. 5 (“3/15/12 Khan Email”), Ex. 9 (“12/22/11 Khan Email”); Khan Dep. at 51:20-52:6.) As such, when evidence of all Clearly Canadian sales between 2009 and the present is taken into account, summary judgment on the issue of non-use is inappropriate.  (David Lilenfeld: the court makes this analysis look even, suggesting it was not even a close call).

In its reply brief, Top Shelf contends for the first time that sales to third-party retailers or distributors do not constitute use in commerce within the meaning of the Lanham Act because such sales are not uses by or for the benefit of the trademark owner.  (Reply (Dkt. # 102) at 4-5.) Top Shelf bases its argument on two twenty-year-old opinions by the Trademark Trial and Appeal Board (“TTAB”) that stated: “A party cannot defend against a claim of abandonment by relying on some residual goodwill generated through post-abandonment sales of the product by distributors or retailers.” Parfums Nautee Ltd., 22 U.S.P.Q.2d 1306 (P.T.O. Jan. 15, 1992); (David Lilenfeld: Societe Des Produits Marnier Lapostolle, 10 U.S.P.Q.2d 1241, at *4 n.5 (P.T.O. Feb. 10, 1989) (finding a presumption of abandonment when the last shipment of trademarked products to the United States occurred more than three years prior, despite the fact that retailers continued to sell the product thereafter)).

Top Shelf does not explain how these TTAB rulings fit into Ninth Circuit jurisprudence regarding abandonment.2  (See Reply.) More importantly, in the court is aware of only one district court in this circuit that has followed those rulings.  See Zamacona v. Ayvar, No. CV0702767ABCFMOX, 2009 WL 279073, at *2 (C.D. Cal. Feb. 3, 2009); but see Soweco, Inc. v. Shell Oil Co., 617 F.2d 1178, 1189 (5th Cir. 1980) (finding no abandonment) (David Lilenfeld: this argument came too late).

Clearly Food has not had an opportunity to respond to Top Shelf’s newly raised argument, and because, as explained below, consideration of the argument would not change the outcome of this motion, the court declines to decide the issue at this time. See Provenz v. Miller, 102 F.3d 1478, 1483 (9th Cir. 1996) (stating that a court should not consider new issues or evidence submitted in a reply brief without giving the opposing party an opportunity to respond).

Even if the court agreed that Clearly Food could not rely on sales by unaffiliated retailers or distributors, summary judgment on the abandonment claim would not be appropriate. (David Lilenfeld: agreed -- use in commerce is use in commerce, whether by the trademark owner or a third-party). It is undisputed that Clearly Canadian beverages were sold in the United States by or on behalf of Clearly Canadian to Paw Paw in September 2009, and to Beverages Direct in October 2012. (See Bogen Decl. ¶ 5, Attach. A; Colley Dep. at 39:3-43:9; 66:11-24; 79:15-79: Khan Dep. at 79:21-80:6.); Star-Kist Foods, Inc. v. P.J. Rhodes & Co., 769 F.2d 1393, 1396 (9th Cir. 1985); 15 U.S.C. §1127.

30Jan/160

“Clearly Canadian” Makes for a Clearly Good Trademark Opinion

David Lilenfeld comments on this trademark infringement opinion, in which the owners of trademarks CLEARLY CANADIAN and CLEARLY KOMBUCHA do battle.

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON

THE CLEARLY FOOD & BEVERAGE CO., INC.,

Plaintiff,

v.

TOP SHELF BEVERAGES, INC.,

Defendant.

ORDER GRANTING IN PART AND DENYING IN PART SUMMARY JUDGMENT

I.      INTRODUCTION

Before the court is Defendant Top Shelf Beverages, Inc.’s (“Top Shelf”) motion for summary judgment. (See Mot. (Dkt. # 47).) (David Lilenfeld: we learn right away what the case is about; have you already formed an opinion?) This is a trademark case involving two brands of bottled beverages: “Clearly Canadian” sparkling water and “Clearly Kombucha” fermented tea. (David Lilenfeld: according to wikipedia, Kombucha refers to any of a variety of fermented, lightly effervescent sweetened black or green tea drinks that are commonly intended as functional beverages). Having considered the submissions of the parties, the balance of the record, and the relevant law, and deeming oral argument unnecessary, the court GRANTS in part and DENIES in part Top Shelf’s motion for summary judgment.

II.      BACKGROUND

Unless otherwise noted, the following facts are undisputed. Plaintiff The Clearly Food & Beverage Co. (“Clearly Food”) owns the trademark “Clearly Canadian,” United  States Trademark Registration No. 1,697,898, as used on “flavored mineral waters, fruit flavored mineral waters, non-flavored mineral waters, carbonated mineral waters, non-carbonated mineral waters, bottled drinking waters, spring waters, soft drinks and fruit juices.” (Resp. (Dkt. # 54)) at 4; Ledden Decl. (Dkt. # 47-3) Ex. 2 (“Assignment”).)

Clearly Food obtained this trademark from the now-defunct Clearly Canadian Beverage Corporation (“CC Beverage”) in January 2012. (David Lilenfeld: out of bankruptcy is always an interesting way to acquire trademark rights). (See Assignment.) CC Beverage sold bottles of flavored sparkling water under the brand name “Clearly Canadian.” (Req. for Not. (Dkt. # 49) Ex. E (“Trustee’s Rep.”).) After struggling for several years to compete in the beverage market (David Lilenfeld: which we all know is insanely competitive), CC Beverage filed for bankruptcy in March 2010. (Id.; Req. for Not. Ex. D (“Bank. Filing”).) In January, 2012, the Clearly Canadian trademark was sold to Clearly Food on behalf of CC Beverage’s secured creditors. (Ledden Decl. Ex. 1 5    (“Not. of Seizure”).) Although by that time the product was no longer being manufactured (David Lilenfeld: how long had the trademark been unused -- an important issue), Clearly Food intended to “reintroduce Clearly Canadian” by “bringing back the original legacy line in its premium glass teardrop bottle (6+ flavors).” (David Lilenfeld: this sounds like there may be a trademark tacking issue here) Decl. Ex. 3 (“Khan 8/23/11 Email”), see also Ex. 14 (“2012 Bus. Plan”) (detailing Clearly Food’s product development and pricing, marketing, sales, and distribution strategies, with a goal to “enter full-scale commercial production by March 2013 for North America”).)

Since then, manufacturing of Clearly Canadian beverages in limited quantities has resumed. (Dabish Decl. (Dkt. # 56) ¶¶ 2-5.) (David Lilenfeld: again, how long was the non-use period?). Bottles of Clearly Canadian sparkling water have been sold online. (Colley Dep. (Dkt. # 57-1) at 91:6-92:4.) Clearly Food is engaged in an online pre-sales campaign directed at consumers, and has also received larger-scale orders from several beverage distributors. (2d Khan Decl. (Dkt. # 93-13) at ¶¶ 3-5.) (David Lilenfeld: Here an important fact to keep in mind). Clearly Food plans to begin selling its products in retail grocery stores in 2015.  (Lilenfeld PC: it seems that the period of non-use was roughly three years (from 2012 to 2015)).

Top Shelf was founded by Caleb Cargle and Alison Zarrow in 2009. (David Lilenfeld: could be setting-up a senior user debate). (Cargle Decl. (Dkt. # 47-1) ¶ 2; see generally Cargle Dep. (Dkt. # 57-3) at 35:17-37:19.) Top Shelf currently sells a flavored kombucha beverage under the trademarked label “Clearly Kombucha.” (Cargle Dep. ¶ 1.) Kombucha is a drink brewed from green tea and then fermented with a symbiotic colony of bacteria and yeast. (Id. ¶ 16.) Mr. Cargle and Ms. Zarrow have developed a unique type of kombucha that is “clear.” (Id. ¶ 7.) That is, due to the filtration process used during brewing, their kombucha is “free from solid ‘floaties’ typically associated with kombucha [that are] . . . caused by the symbiotic colony of bacteria and yeast.” (Id. ¶¶ 6-7.)

The co-founders originally sold their product under the brand “Top Shelf Kombucha.” (Id. ¶ 9.) They marketed Top Shelf Kombuhca as a high-end or “premium” mixer and non-alcoholic substitute, and sold it in a miniature champagne bottle. (Id. ¶ 8.)  (David Lilenfeld: note that no first use date for Top Shelf's use of CLEARLY KOMBUCHA is revealed yet).

Although supplies were limited by their production capabilities, they believed the sales results “showed promise.” (Id. ¶ 10.)  At the end of 2010, the co-founders changed strategies. (Id. ¶ 12; Zarrow Dep. (Dkt. # 57-5) at 9:11-17.) After consulting with brand advisors, they decided to differentiate their product from its competitors based on its “clear” character. (Cargle Decl. ¶ 12; Zarrow Dep. at 12:16-24.) They also decided that they wanted Top Shelf to be recognized as a socially conscious brewer with transparent manufacturing practices.  (Cargle Decl. ¶ 13)

To reflect those goals, they decided to change the name of their product to “Clearly Kombucha.” (Id.) (David Lilenfeld: Top Shelf changed to CLEARLY KOMBUCHA toward end of 2010). The co-founders applied for a federal trademark registration in November 2010, and the “Clearly Kombucha” mark was published for opposition in April 2011. (Req. for Not. Exs. A, B.) After the mark was published (David Lilenfeld: how soon after?), the Clearly Kombucha brand launched in Ralph’s grocery stores throughout California. (Cargle Decl. ¶ 14.) Clearly Kombucha beverages are now sold at various retailers, including, among others, Safeway stores in Northern California and the Pacific Northwest, Ralph’s stores in southern California, a few Whole Foods grocery stores in Northern California, and PCC natural food stores in Washington and Oregon. (Cargle Dep. at 73:3-74-12; Zarrow Dep. at 27:21-28.) Clearly Kombucha is also available for purchase over the Internet. (Cargle Dep. at 83:21-25.)

(David Lilenfeld: the trademarks and goods seem different enough that I would not expect to see a likelihood of confusion, but more facts to come). In September,2013, Clearly Food filed this action against Top Shelf, bringing claims for trademark infringement under the Lanham Act § 32, 15 U.S.C. § 1114, unfair competition under the Lanham Act § 43(a), 15 U.S.C. § 1125(a), trademark dilution under Lanham Act § 43(c), 15 U.S.C. § 1125(c), and trademark infringement and unfair competition under Washington State law. (See generally Compl. (Dkt. # 1).) Top Shelf’s Motion for summary judgment on all claims is now before the court. (See Mot.)

III.      ANALYSIS

A.        Summary Judgment Standard

Federal Rule of Civil Procedure 56 permits a court to grant summary judgment where the moving party demonstrates (1) the absence of a genuine issue of material fact and (2) entitlement to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); see also Galen v. Cnty. of L.A., 477 F.3d 652, 658 (9th Cir. 2007). The moving party bears the initial burden of showing the absence of a genuine issue of material fact. Celotex, 477 U.S. at 323.  (David M. Lilenfeld: standard MSJ discussion).

If the moving party does not bear the ultimate burden of persuasion at trial, it can show the absence of an issue of material fact in two ways: (1) by producing evidence negating an essential element of the nonmoving party’s case, or (2) by showing that the nonmoving party lacks evidence of an essential element of its claim or defense. Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1106 (9th Cir. 2000). If the moving party will bear the ultimate burden of persuasion at trial, it must establish a prima facie showing in support of its position on that issue. UA Local 343 v. Nor-Cal Plumbing, Inc., 48 F.3d 1465, 1471 (9th Cir. 1994). That is, the moving party must present evidence that, if uncontroverted at trial, would entitle it to prevail on that issue. Id. at 1473.

If the moving party meets its burden of production, the burden then shifts to the nonmoving party to identify specific facts from which a factfinder could reasonably find in the nonmoving party’s favor. Celotex, 477 U.S. at 324; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986). In determining whether the factfinder could reasonably find in the nonmoving party’s favor, “the court must draw all reasonable inferences in favor of the nonmoving party, and it may not make credibility determinations or weigh the evidence.” Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000).  (David Lilenfeld: Court providing a thorough discussion of MSJ standard).

B.        Judicial Notice

Top Shelf requests that the court take judicial notice (David Lilenfeld: why didn't Top Shelf just submit the documents) of the following documents:

(1) Top Shelf’s Trademark Application for the Clearly Kombucha mark, (2) the Notice of Publication of the Clearly Kombucha mark, (3) the Trademark Registration Certificate for the Clearly Kombucha mark, (4) the Combined Declaration of Use and/or Exclusable Nonuse /Application for Renewal of Registration of a Mark under Sections 8 & 9 for the Clearly Canadian mark, (5) the Proposal under the Bankruptcy and Insolvency Act filed in March 2010 by CC Beverage, and (6) the Trustee’s Report to Creditors filed in In the Matter of the Proposal of Clearly Canadian Beverage Corporation, dated March 17,  2010. (See Req. for Not. Exs. A-F.) Top Shelf obtained the trademark documents from the U.S. Patent and Trademark Electronic Search System, and obtained the bankruptcy documents from the Supreme Court of British Columbia (Vancouver Registry). (Id. ¶¶ 6- 7.)

Rule 201 of the Federal Rules of Evidence permits a federal court to take judicial notice of a fact that is not subject to “reasonable dispute” because it is “capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably questioned.” Fed. R. Evid. 201(b)(2). (David Lilenfeld: seems like a detour from the main trademark issues). The public records of administrative agencies   and other courts are appropriate matters for judicial notice. Reyn’s Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006) (taking notice of court filings); see also Dahon N. Am., Inc. v. Hon, No. 2:11-CV-05835-ODW, 2012 WL 1413681, at *8 (C.D. Cal. Apr. 24, 2012) (taking judicial notice of documents filed on the United States trademark website); CDx Diagnostics Inc. v. Histologics LLC, No. CV 13-7909-DOC NBX, 2014 WL 3347525, at *3 (C.D. Cal. July 7, 2014) (collecting cases taking judicial notice of documents from administrative agencies). Clearly Food has not objected to Top Shelf’s request. Accordingly, for the purposes of this motion, the court grants Top Shelf’s request for judicial notice.  (David Lilenfeld: typically courts just do it without explanation; maybe plaintiff challenged it).

28Jan/160

Sovereign Military Hospitaller Oder v. Florida Priory of the Knights Hospitallers

This case has been a long-standing trademark battle between two religious organizations with long and similar names:

(1) Sovereign Military Hospitaller Order of Saint John of Jerusalem of Rhodes and of Malta and Florida Priory of the Knights Hospitallers of the Sovereign Order of Saint John of Jerusalem, Knights of Malta, the Ecumenical Order.

(2) Sovereign Military Hospitaller Order of Saint John of Jerusalem of Rhodes and of Malta

The 11th Circuit Court of Appeals overruled a district court’s decision that one branch of the Knights of Malta committed fraud when it filed its federal trademark application in 1958. Another branch of the Knights of Malta sued for trademark infringement alleging false advertising under the Lanham Act, 15 U.S.C. § 1051 and state law claims for Florida Deceptive and Unfair Trade Practices Act (FDUTPA), Fla. Stat. § 501.201. Fraud requires a showing of the registrant’s awareness of competing marks.

The district court found the plaintiff’s federally registered trademark was obtained fraudulently because the plaintiff knew of the defendant’s prior use of the mark. Judge Charles Reginald Wilson of the appeals court first reversed the fraud judgment. According to 15 U.S.C. § 1064 (3), 1119, “a party may petition to cancel a registered mark on the ground that the registration was procured by fraud.” It was held in Angel Flight of Ga., Inc. v. Angel Flight Am., Inc., 522 F.3d 1200, 1209 (11th Cir. 2008) that an applicant commits fraud when he “knowingly makes false, material representations of fact in connection with an application for a registered mark.” Fraud requires a purpose or intent to deceive the PTO. The defendant, the party alleging the fraud, has the burden of proving this claim by clear and convincing evidence.

Furthermore, the appellate court overruled the district court’s finding of fraud because the facts show the person who signed the trademark application did not know about the use of a similar mark. If the declarant believes the applicant has a superior right to use the mark, there is no fraud even if the declarant is mistaken.

Also, the district court found plaintiff’s failure to inform defendant is evidence of willful blindness. To rule on the knowledge element of fraud, the district court relied upon recent case law from Global-Tech Appliances Inc. v. SEB S.A., 131 S.Ct. 2060, 98 USPQ2d 1665 (U.S. 2011) that willful blindness could satisfy actual knowledge as to liability for inducing infringement. The appeals court rejected the effort to apply this case law to a trademark case because the case law is from a patent law case. Courts do not automatically apply a standard from one area of intellectual property law to another area of intellectual property law.

In conclusion, the 11th Circuit found in favor of the plaintiff because a lack of clear and convincing evidence. On remand, the district court misapplied several factors in its analysis of likelihood of confusion, incorrectly assessed the defense of prior use, relied upon testimony that the appellate court previously deemed inadmissible and misinterpreted the 11th Circuit’s instructions about consulting facts outside the record.

28Jan/160

David Lilenfeld Breaks Down TTAB’s Reversal Re: KID TENNIS

The Trademark Office reversed a Section 2 (d) refusal of the KID TENNIS mark because they found it dissimilar to the TENNISKIDS mark. Even though the brands are selling nearly identical goods, the Trademark Office ruled that KID TENNIS is not likely to cause confusion with TENNISKIDS.

The Board of the Trademark Office disagreed with the Examining Attorney’s belief that the wording of KIDS TENNIS is the dominant feature of the mark’s commercial impression. In this case, the wording as well as the design creates the Applicant’s trademark.

Furthermore, the Trademark Office was not convinced that TENNISKIDS was registered in standard character form. The trademark owner’s mark is so stylized that it does not fall within the range of reasonable manners of display that should be reserved for registered standard character mark. Therefore, the Trademark Office found the marks to be visually dissimilar.

In regards to how the respective trademarks sound, the Trademark Office ruled the marks are more similar than dissimilar but found the meaning of the marks to be different. The applicant’s mark, KID TENNIS, connotes a character named “Kid Tennis” as opposed to the registered mark, TENNISKIDS, which connotes children who play tennis.

“The Trademark Office ruled that the dissimilarity of the marks outweigh other factors, but clearly from the ruling, it was a close call, said, David Lilenfeld of Lilenfeld PC.

 

27Jan/160

David Lilenfeld breaks down trademark infringement case from Middle District of Georgia

In this post, David Lilenfeld breaks down the Court's opinion in the trademark infringement lawsuit FN Herstal, S.A. v. Clyde Armory, Inc., in the District Court for the Middle District of Georgia Case No. 3:12-cv-102.

ORDER ON SUMMARY JUDGMENT

This trademark infringement action is currently before the Court on Plaintiff FN Herstal, S.A.’s Motion for Summary Judgment [Doc. 85] and Defendant Clyde Armory, Inc.’s Motion for Partial Summary Judgment [Docs. 85].  Having considered the parties’ arguments, the record, and the applicable law, both Motions are DENIED.1

LEGAL STANDARD

[David Lilenfeld: Here is not only a good review of the standard the Court uses to asses a Motion for Summary Judgment, but also the standard for Cross-Motions for Summary Judgment – very helpful]

Under Rule 56 of the Federal Rules of Civil Procedure, summary judgment must be granted “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.”2   A genuine issue of material fact only exists when “there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party.”3    Thus, summary judgment must be granted if there is insufficient evidence for a reasonable jury to return a verdict for the nonmoving party or, in other words, if reasonable minds could not differ as to the verdict.4    When ruling on a motion for summary judgment, the Court must view the facts in the light most favorable to the party opposing the motion.5

The  moving  party  “always  bears  the  initial  responsibility  of  informing  the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits,  if  any,  which it  believes  demonstrate the  absence  of  a  genuine  issue  of material fact” and that entitle it to a judgment as a matter of law.6    If the moving party discharges this burden, the burden then shifts to the nonmoving party to go beyond the pleadings  and  present  specific  evidence  showing  that  there  is  a  genuine  issue  of material fact.7    This evidence must consist of more than mere conclusory allegations or legal conclusions.8

The standard of review for cross‐motions for summary judgment does not differ from the standard applied when only one party files a motion, but simply requires a determination of whether either of the parties deserves judgment as a matter of law on the facts that are not disputed.9   The court must consider each motion on its own merits, resolving all reasonable inferences against the party whose motion is under consideration.10   The Eleventh Circuit has explained that “[c]ross‐motions for summary judgment will not, in themselves, warrant the court in granting summary judgment unless one of the parties is entitled to judgment as a matter of law on facts that are not genuinely disputed.”11    Cross‐motions may, however, be probative of the absence of a factual dispute where they reflect general agreement by the parties as to the controlling legal theories and material facts.12

BACKGROUND

[David Lilenfeld: a detailed discussion of the respective uses of the trademarks in the firearms industry begins here.  The facts are slightly more involved since one of the parties’ is a foreign corporation.]

The current trademark dispute arises out of the parties’ use of the “SCAR” and “SCAR‐Stock” trademarks in the firearms industry.  Unless otherwise indicated, the facts presented below are undisputed.

A. Plaintiff’s Use of SCAR

Plaintiff is a firearms and weapons manufacturer incorporated under the laws of Belgium with  its principal place of  business  in Herstal,  Belgium.13   Plaintiff manufactures and distributes a full range of firearms and accessories for defense, law enforcement, hunting, marksmanship, and others having an interest in acquiring such firearms and accessories.14  The current dispute arises out of Plaintiff’s development and branding of its SCAR rifle.

1.   Plaintiff’s Sales to the US Military

[David Lilenfeld: This portion is important for the interplay between trademarks and acronyms, an issue many people confuse.]

In 2003, the United States Special Operations Command (“USSOCOM”) initiated the Special Operation Forces (“SOF”) Combat Assault Rifle Program, which was abbreviated at times as the “SCAR” Program.15     Publicized as the first full and open competition  since  the  M16  trials  held  in  the  mid‐1960s,  the  USSOCOM  Program solicited an open bid to firearm manufacturers to design a new modular assault rifle system for the US Military.16    Defendant contends that the USSOCOM Program serves as the origin of the SCAR mark at issue in this case.  [David Lilenfeld: here is the first mention of Dates of First Use – an important issue in almost every trademark infringement case]. Plaintiff, however, represents that it adopted the SCAR mark in 2003 prior to the USSOCOM Program to designate a specifically designed weapon for commercialization in the North American market and abroad.17

Pursuant to the Program, USSOCOM specified that the SCAR rifle would be a modular  system in  two  threshold  configurations,  a  “SCAR‐Light (SCAR‐L)” and a “SCAR‐Heavy (SCAR‐H).” 18   Both the SCAR‐L and the SCAR‐H were available in three variants: Standard (S), Close Quarter Combat (CQC), and Sniper Variant (SV).

In 2003 and 2004, Plaintiff and other firearm manufacturers submitted prototypes of rifles meeting USSOCOM specifications.20   USSOCOM officially awarded the contract to Plaintiff to produce the SCAR rifle and attachments on November 5, 2004.21    On that same day, USSOCOM ordered over $634,000 of firearms and attachments from Plaintiff.22    Shortly thereafter, the ordered weapons were shipped to Crane, Indiana, inspected, and accepted by the US government.23     [David Lilenfeld: again, another mention of the Date of First Use]. To fulfill its obligations under the USSOCOM Program, Plaintiff shipped firearms bearing the SCAR trademark throughout 2004 and 2005 to various US military institutions, including USSOCOM, Naval Air Systems Command (“NAVAIR”) and Naval Surface Warfare Center (“NSWC”).24

Throughout 2005 and 2006, magazine and newspaper articles tracked the development of the new assault rifle for the USSOCOM Program, highlighted Plaintiff’s role in the Program, and outlined the features and benefits of the different variants and forms of the new SCAR rifle system.

2.   Promotion of Plaintiff’s SCAR Rifles

[David Lilenfeld: here the Court is discussing the breadth of use of the trademark, another issue that is important in most trademark infringement cases]. After the USSOCOM Program award, Plaintiff began promoting its SCAR mark to the wider commercial market.  In 2005 and 2006, Plaintiff promoted its SCAR rifles at trade shows and during visits to gun dealers, law enforcement agencies, stores, and distributors.26    For example, in February 2006, Plaintiff unveiled its SCAR‐Light and SCAR‐Heavy prototypes during the SHOT Show held in Las Vegas, Nevada, a major industry trade show attended by military personnel, other government agencies, law enforcement organizations, manufacturers, distributors, retailers, sportsmen, hunters, and other firearms enthusiasts.27

[David M. Lilenfeld: just as it is important to discuss what uses each party made of their respective trademarks, it is important to discuss the relevant ways in which each party does not use their respective trademarks]. During these promotional activities, it is undisputed that Plaintiff did not have a semi‐automatic version available for purchase by law enforcement and civilian consumers.   The firearms displayed at the tradeshows were fully automatic machine guns, the sale of which is restricted to military and law enforcement agencies only.28   In order for Plaintiff to sell a semi‐automatic SCAR to the civilian market, Plaintiff first needed government approval.

[David Lilenfeld: note how detailed and “granular” the Court has to get with the types *quality and quantity) of uses Plaintiff made of its trademarks]. Nevertheless, Plaintiff continued to promote its SCAR rifle to law enforcement and civilian markets.  Plaintiff distributed hats, t‐shirts, brochures, and other marketing materials bearing the SCAR mark to others in the firearm industry.30        Plaintiff even referenced the  new  SCAR rifle  in  its  2006  product  log  and  highlighted  its  role  in creating USSOCOM’s SCAR rifle.31     In several of Plaintiff’s advertisements, the SCAR mark is displayed beside or above the words “S.O.F. Combat Assault Rifle” or some variant thereof.32    Several of Plaintiff’s advertisements boast that Plaintiff’s SCAR rifle was chosen by “US Special Operations Command,”33 and three of those advertisements depict the official emblem of the U.S. Special Operation Forces for the US Military in connection with Plaintiff’s SCAR mark.34

Then, on March 2, 2006, Plaintiff issued a press release, entitled “The Making of the 21st Century Assault Rifle: SCAR SOF Combat Assault Rifle,” announcing its plan to introduce a semi‐automatic version of the SCAR “in the next two years” for law enforcement and commercial markets.35

Plaintiff began accepting orders for SCAR rifles from law enforcement agencies in either 2007 or 2008, and filled its first orders to law enforcement and civilian consumers in late 2008.36   [David Lilenfeld: amount of goods sold under a particular trademark is also very often a pertinent factor in a trademark infringement analysis]. Since that time, Plaintiff has sold nearly one hundred million dollars ($100,000,000.00) of SCAR firearms to law enforcement and civilian consumers.37

3.   Plaintiff’s Trademark and Patent Registrations

[David Lilenfeld: Obviously, trademark registrations of the parties’ is an important consideration, along with their age (typically the older the registration is the stronger it is)]. To protect its interest in the SCAR mark, Plaintiff filed three trademark applications with the United States Patent and Trademark Office (the “USPTO”).38    On April 22, 2008, Plaintiff filed the first application (the ‘575 Application) for the use of SCAR on firearms and related items, which is still pending before the USPTO.39     On January 13, 2009, Plaintiff filed a trademark application for SCAR and Design for use in connection with firearms and related items.40      The application claimed Plaintiff first used the mark in commerce on November 1, 2008.41    The USPTO registered the SCAR and Design mark on June  15,  2010  (the  ‘448 Registration).42      On January 13,  2011, Plaintiff  filed  its third trademark application for SCAR for  use  in connection with games, toy replicas of weapons, and other related items.43     The USPTO registered the SCAR mark on February 21, 2012 (the ‘728 Registration).44

In addition to registering the SCAR mark, Plaintiff obtained a design patent for its assault rifle (the ‘824 Patent) on July 19, 2011.45   On January 10, 2012, Plaintiff filed an action for patent and trade dress infringement involving the ‘824 Patent in the US District Court for the Northern District of Texas, wherein Plaintiff alleged that it “introduced the FNH SCAR (Special Combat Assault Rifle) assault rifle, today known by  two  different  models  including  the  FN  SCAR  16  and  FN  SCAR  17”  in  2009.46

Plaintiff voluntarily dismissed the Texas suit prior to service of the complaint.47

B.  Defendant’s Use of SCAR‐Stock

[David Lilenfeld: Here, the Court discusses Defendant’s uses of its trademark and the landscape of the trademark battle begins to reveal itself]. Defendant is a firearms retailer and distributor incorporated under the laws of Georgia with its principal place of business in Bogart, Georgia.48      In 2005, Andrew Clyde, Defendant’s CEO and owner, contacted John Klein, the president of Sage International, Ltd., to discuss the possibility of making replacement stock for certain rifles made by Sturm Ruger & Co., including the Mini‐14, Mini‐30, and AC‐556, among others.49     The two followed up with each other in person at the February 2006 SHOT show in Las Vegas to discuss the details of the new product.50    [David Lilenfeld: here we learn that Plaintiff’s product is different from Defendant’s trademark (rifle v. a stock for a rifle.  This is leading us down the path of “relatedness” issue). After the February 2006 SHOT Show, Defendant adopted the SCAR‐Stock mark as an acronym for “Sage Clyde Armory Rifle Stock” to refer to the new product and to reflect the collaborative effort behind the product’s design.

The testimony regarding the circumstances and purpose of adopting the SCAR‐ Stock mark, however, is somewhat disputed.  Mr. Clyde testified that before deciding to adopt the mark, he conducted several searches online through Google and the USPTO’s website to check the availability of SCAR as a viable mark and found no prior use of the mark in the firearms industry.52    However, Defendant has no documentary evidence to substantiate those searches.53   [David Lilenfeld: how often will you have documents to prove a Google search you conducted years ago?  This is a tough as.  Also, it’s the first indication see of the Judge leaning in Plaintif ’s direction]. M [David Lilenfeld: Another “bad fact” for Defendant.  The Court’s leaning begins to be unveiled]. Moreover, at the time Defendant adopted the SCAR‐Stock mark, Defendant was aware of Plaintiff’s participation in the USSOCOM Program to create the SOF Combat Assault Rifle and knew that the acronym for that rifle was SCAR.54     [David Lilenfeld: Well, this next sentence/fact might be the death knell for Defendant. Bad intent is another factor taken into consideration by courts in a trademark infringement case]. Defendant’s former Chief Operating Officer, Joshua Smith, testified that Defendant  adopted  SCAR‐Stock,  in  part,  to  take  commercial  advantage  of  the popularity  of  the  SCAR  rifles  in  the  firearms  industry.55   [David Lilenfeld: Ouch!] Mr.  Clyde,  however, specifically disclaims any such purpose in adopting the mark.

[David Lilenfeld: Clearly, Plaintiff has earlier Dates of First Use, so that does not appear to be in dispute]. By early fall of 2006, Defendant and Sage completed initial manufacturing of the SCAR‐Stock product and introduced it to the firearms market.57    On August 29, 2006, Defendant began soliciting customer orders for its SCAR‐Stock products.58    Defendant received  and  accepted  its  first  order  for  SCAR‐Stock  on  September  14,  2006.59

Defendant then shipped orders beginning the week of September 18, 2006.60     It is undisputed that the gun stock bearing Defendant’s SCAR‐Stock is not compatible with and cannot be used with Plaintiff’s SCAR rifle. From the end of 2006 through 2008, Defendant enjoyed an annual increase in sales of its SCAR‐Stock product.62      In 2009, sales dropped slightly due to the unavailability of the product and delivery issues from Sage.63    During that time, Sage had substantial orders from the military, and those orders were given priority over all other orders, including those for Defendant’s SCAR‐Stock product.64

C.  Events Leading to the Current Dispute

[David M. Lilenfeld: This letter is sent about three years after Defendant started using the SCAR trademark, but that is still not so long for Plaintiff as to be concerned about a laches defense]. On February 6, 2009, Louis Dillais, President and CEO of FNH USA, LLC, a subsidiary of Plaintiff, sent Defendant a letter asserting senior rights in the SCAR mark and demanding that Defendant cease and desist all use of its SCAR‐Stock mark.65    Mr. Clyde responded on Defendant’s behalf indicating he had no knowledge of Plaintiff’s rights in the mark and requesting documentation to support that claim.66   The following day  Defendant  filed  a  trademark  application  for  the  SCAR‐Stock  mark  (the  ‘128 Application) with the USPTO for use on “gun stocks” and claiming a first use date in commerce of September 14, 2006.67

Defendant received a reply from FNH USA68 stating that “the acronym SCAR in US Government jargon does refer to the USSOCOM Program.”69    The letter went on to state “[h]owever, in Commercial firearms use of the term SCAR has been registered by [Plaintiff], our parent company, as a Trademark.”70

Defendant then filed a Petition for Cancellation with the USPTO of Plaintiff’s '448 Registration for SCAR and Design and an Opposition to Plaintiff’s ‘575 Application 65 Def.’s Statement of Material Facts, Ex. J at CA00021 [Doc. 90‐10].

66 Id. at FN101158.

67  Umansky Decl. ¶ 12, Ex. 10 [Doc. 89‐3]. The USPTO initially denied registration of the SCAR‐Stock mark because it was merely descriptive of a feature and characteristic of the product. Def.’s Statement of Material Facts, Ex. D, p. 9 [Doc. 90‐4]. The initial refusal explained that a “scar rifle” is a modular rifle created by Plaintiff for USSOCOM to satisfy the requirements of the SCAR Program, and the “scar stock” is a gun stock that is specifically made for a “scar assault rifle.” Id. at 10.  In response to the first refusal, Defendant explained that SCAR as used in its SCAR‐Stock mark is an arbitrary acronym for “Sage/Clyde Armory Rifle” and that Defendant’s SCAR‐Stock products are not compatible with Plaintiff’s SCAR rifles. Id. at  12‐13.  Thereafter,  the  USPTO  refused  registration  of  Defendant’s  mark  on  the  grounds  that consumers would likely confuse Defendant’s mark with Plaintiff’s SCAR mark in the ‘448 Registration. Id. at 17.

68  It is unclear which individual responded on behalf of FNH USA. The letter includes a signature block

with Dillais’ name, but the handwritten signature appears to belong to someone else.

69 Def.’s Statement of Material Facts, Ex. J at CA0022 [Doc. 90‐10].

70 Id.

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for SCAR.71       The USPTO suspended those proceedings pending the outcome of this

 

 

case.72

 

 

D. Procedural History

 

 

[David Lilenfeld: interesting to me that the lawsuit was filed six years after Defendant began using the allegedly infringing trademark]. On March 12, 2012, Plaintiff filed this suit in the Eastern District of Virginia against Defendant and Sage.  Thereafter, the Court dismissed Sage for lack of personal jurisdiction and transferred the remaining case against Defendant to the Northern District of Georgia.  Upon determining that Defendant’s principal place of business is located in the Middle District of Georgia, the case was transferred to this Court on August 8, 2012.

Shortly  after  the  transfer,  Plaintiff  filed  an  Amended  Complaint.    Therein, Plaintiff raises federal claims for trademark infringement, unfair competition, and dilution,73  in violation of the Lanham Act, 15 U.S.C. § 1051, et seq.  Plaintiff also raises state   law   claims   for   unfair   competition,   deceptive   trade   practices,   and   unjust enrichment.   Plaintiff seeks punitive damages and litigation expenses, including attorney’s  fees.    Plaintiff  also  seeks injunctive  relief  enjoining  Defendant  from  any further  use  of  SCAR‐Stock  and  ordering  Defendant  to  (1)  abandon  its  pending

 

 

 

 

 

 

71 Id. at pp. 9‐20.

72 Id. at pp. 21‐22.

73  In its Motion for Summary Judgment, Plaintiff represents that it is withdrawing its federal dilution claim.

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trademark application for SCAR‐Stock and (2) dismiss its opposition and cancellation

 

 

petitions to Plaintiff’s ‘448 Registration and “575 Application.

 

 

Defendant asserts affirmative defenses based on priority of use in its SCAR‐Stock mark and unlawful use of the SCAR mark by Plaintiff.  In addition, Defendant raises counterclaims for federal trademark infringement and declaratory relief, seeking cancellation  of  Plaintiff’s  trademark  registrations  and  refusal  of  the  pending  ‘575

Application pursuant to 15 U.S.C. § 1119 due to Defendant’s superior rights in the

 

 

SCAR‐Stock mark and Plaintiff’s lack of bona fide use or intent to use the SCAR mark in commerce. Defendant seeks similar damages and injunctive relief.

DISCUSSION

 

 

As acknowledged by the parties, the success of all the claims and counterclaims in  this  case  depends  on  the  outcome  of  their  trademark  infringement  claims.74

Accordingly, the Court will limit its discussion to the trademark infringement issues presented.

Both parties have moved for summary judgment, each asserting a superior trademark right in the use of SCAR or SCAR‐Stock.  Plaintiff claims a superior right in its SCAR mark arguing that the mark is distinctive, and Plaintiff was the first to use the

74 Univ. of Georgia Athletic Assʹn v. Laite, 756 F.2d 1535, 1539 n.11 (11th Cir. 1985) (observing that the standards governing Georgia state law claims for trademark infringement, deceptive trade practices, and unfair competition are “similar, if not identical, to those under the Lanham Act.”); see also Planetary Motion, Inc. v. Techsplosion, Inc., 261 F.3d 1188, 1193 n.4 (11th Cir. 2001) (“Courts may use an analysis of federal infringement claims as a “measuring stick” in evaluating the merits of state law claims of unfair competition.”).

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mark in commerce in 2004.  Like Plaintiff, Defendant also asserts superior rights in its

 

 

SCAR‐Stock mark arguing that SCAR‐Stock is distinctive, and Defendant was the first to use the mark in commerce in September 2006.  [David Lilenfeld: Here is a sneak preview of the Court’s ruling – obviously will deny both Parties’ Motion for Summary Judgment]. For the reasons set forth below, the Court finds genuine issues of material fact exist as to which party used the mark first in commerce, and whether the parties’ SCAR and SCAR‐Stock trademarks are distinctive.

A trademark is “any word, name, symbol, or device, or any combination thereof [used] to identify and distinguish [a producer’s] goods, including a unique product, from those manufactured or sold by others and to indicate the source of the goods, even if that source is unknown.”75     To prevail on a trademark infringement claim, a party must prove that (1) it owns a valid and protectable mark, and (2) the opposing party’s use of an identical or similar mark is likely to cause confusion.76     Because the parties market and sell their SCAR and SCAR‐Stock products in the firearms industry, they agree that simultaneous use of the trademarks would likely confuse the purchasing public.77

Therefore, the only issue before the Court is whether either party owns a protectable mark.  In order to establish a valid protectable trademark, a party must prove (1) it used the mark in commerce and (2) the mark is distinctive.78

 

 

 

75 15 U.S.C. § 1127.

76 Gift of Learning Found., Inc. v. TGC, Inc., 329 F.3d 792, 797 (11th Cir. 2003) (citing 15 U.S.C. § 1125(a)).

77  In addition to the parties’ agreement on the likelihood of confusion issue, the USPTO found consumers will likely confuse the two marks, as evidenced by its refusal to register Defendant’s SCAR‐Stock mark. See Second Office Action, Ex. D, p. 17 [Doc. 90‐4].

78 Knights Armament Co. v. Optical Sys. Tech., Inc., 654 F.3d 1179, 1188 (11th Cir. 2011).

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With respect to the issue of whether a party owns a protectable trademark, the

 

 

Lanham Act provides that registration is prima facie evidence that the registrant owns the mark and has the exclusive right to use the mark.79         Accordingly, registration creates a rebuttable presumption of ownership dating back to the filing date of the application.80   Here, however, Plaintiff did not file the applications giving rise to its ‘448

Registration  and  ‘728  Registration  until  January  13,  2009  and  January  13,  2011. Defendant began using its SCAR‐Stock mark prior to either of those dates in September

2006.   The heart of this dispute centers on Plaintiff’s use of SCAR prior to September

 

 

2006  and  the  circumstances  surrounding  Defendant’s  adoption  of  the  SCAR‐Stock mark.  Because these events occurred prior to the filing of Plaintiff’s first trademark application, the presumption of ownership and exclusive use afforded to Plaintiff’s trademark registrations does not operate against these earlier uses.81

Thus, the Court now turns to the issues of which party first used the mark in commerce and whether their trademarks are distinctive.

I.          First Use in Commerce

 

 

[David Lilenfeld: This is a great Trademark 101 discussion – perfect for Chapter I of a textbook]. In determining which party has a protectable trademark, the Court first examines the trademarks’ “use in commerce.” Under common law, “actual and continuous use is required to acquire and retain a protectable interest in a trademark.”82   Under the Lanham Act, a mark is used in commerce when

(A) it is placed in any manner on the goods or their containers or the displays associated therewith or on the tags or labels affixed thereto, or if the nature of the goods makes such placement impracticable, then on documents associated with the goods or their sale, and

 

 

(B)  the goods are sold or transported in interstate commerce.83

 

 

To determine whether use is sufficient to create a protectable trademark interest, the Eleventh Circuit requires a trademark claimant to show it (1) adopted the mark and (2) “used [the mark] in a way sufficiently public to identify or distinguish the marked goods in an appropriate segment of the public mind as those of the adopter of the mark.”84    Courts should evaluate whether a party has met both prongs of this test by considering “the ‘totality of the circumstances’—including sales, advertisements, and distribution of goods—in order to determine whether the mark has been sufficiently used in commerce.”

[David Lilenfeld: I am regularly asked if one can file for registration of a trademark before he/she has any sales – the answer is “yes” and here is why]. Under this approach, evidence of sales is “highly persuasive,” but actual sales

 

are not required to prove prior use.86    When sales are absent, a party may show use by “analogous use.”  Analogous use refers to pre‐sale promotional efforts such as “advertising brochures, catalogs, newspaper ads, and articles in newspapers and trade publications.”    When a party relies on analogous use to establish trademark rights “actual technical trademark use must follow the use analogous to trademark use within a commercially reasonable period of time.”89   Moreover, whatever activities are utilized to establish rights in a mark, such use must be continuous.90

[David Lilenfeld: this argument by Defendant is a bit bewildering.  It clearly is not the senior user of the marks that are in contention.  Defendant may be the senior use of its exact trademark, but that is not the question. The question is who is the senior user of the respective marks]. When, as here both parties claim a protectable trademark interest, the Court must determine who used the mark first.91   Not surprisingly, both parties claim to be the senior user of the mark in the firearms industry.  Plaintiff argues that it was the first to use SCAR in commerce, as evidenced by its sale of SCAR rifles to USSOCOM as well as its pre‐sale promotional activities for its civilian‐friendly SCAR rifle.  Defendant, on the other hand,  argues it  was the  first  to  use its SCAR‐Stock mark in September 2006 because Plaintiff did not have a semi‐automatic SCAR rifle available for that time.  In support of its Motion, Defendant argues the undisputed evidence shows (1) Plaintiff admitted it did not use the SCAR mark in commerce until November 1, 2008; and (2) Plaintiff’s pre‐sale promotional activities constituted unlawful use of the SCAR mark, and thus cannot create a protectable trademark interest in SCAR.  Having reviewed both arguments, the Court finds that a genuine issue of material fact remains as to which party used the mark in commerce first.

A. Plaintiff’s Admission of First Use Date

 

 

Defendant first argues that Plaintiff cannot claim prior use in its SCAR mark because, in the trademark application giving rise to the ‘448 Registration, Plaintiff admitted it did not use the SCAR mark in commerce until November 1, 2008—over two years after Defendant’s first use of SCAR‐Stock in September 2006.92      Similarly, Defendant argues that Plaintiff alleged in its complaint filed in the Texas patent infringement case that it did not introduce the SCAR rifle until 2009.  [David Lilenfeld: wow, I didn't expect this and not sure I agree with the Court, with all due respect, but let’s see the Court’s reasoning]. Plaintiff, however, is not bound by either of these dates.

With respect to the patent infringement case, Defendant submits that Plaintiff’s allegation operates as an admission that Plaintiff did not introduce the SCAR rifle in commerce until 2009.   Defendant, however, overstates the evidentiary effect of this allegation.  Pleadings by a party in one suit do no serve as binding judicial admissions against that party in subsequent litigation, but may serve as evidentiary admissions, which the party may explain or contradict.  [David Lilenfeld: this also goes to Defendant’s credibility, which needs to be weighed].

Similarly, Plaintiff is not bound by the first use date alleged in its trademark application and instead may prove an earlier date of use by clear and convincing evidence.  This is a particularly “heavy burden” upon a plaintiff when “the date on which the trademark application was filed is substantially contemporaneous with the date of first use alleged therein and an attempt is made many years later to establish an earlier date.”  Evidence in support of a prior use date “should not be characterized by contradictions, inconsistencies, and indefiniteness, but should carry with it conviction of its accuracy and applicability.”

Here, Plaintiff filed its trademark application for SCAR and Design for use in connection with firearms on January 13, 2009, claiming a first  use in commerce on November 1, 2008.   Now, Plaintiff seeks to prove a first use date nearly four years before the date claimed in its application.   Therefore, to overcome Defendant’s arguments and prevail on summary judgment, Plaintiff must show, by clear and convincing evidence, that it adopted and used the SCAR mark in commerce prior to September 2006.

Plaintiff argues the undisputed facts show it was the first to use the mark in commerce as evidenced by its (1) actual sale of SCAR rifles to the US Military in 2004 and (2) analogous use of its SCAR mark through pre‐sale promotional activities of its civilian‐friendly SCAR rifle.  A genuine issue of material fact, however, exists as to whether these activities were sufficiently continuous and public to allow firearms customers to distinguish Plaintiff’s products from others in the firearms industry.

With  respect  to  actual  sales,    the  evidence  shows  that  Plaintiff  sold  SCAR firearms to USSOCOM on November 5, 2004, but did not sell SCAR firearms to the rest of the firearms industry—namely to law enforcement and civilian consumers—until late

2008.  A reasonable juror could find that a sale to a single customer is not sufficiently public to constitute use in commerce. Moreover, because additional sales of SCAR rifles did not occur until four years later, one may conclude that Plaintiff’s use of SCAR was too sporadic to give rise to a protectable interest.

On the other hand, certain factors unique to this case could allow a reasonable

 

juror to  conclude  that  Plaintiff’s  sales  to  USSOCOM coupled with  its  promotional activities were sufficiently continuous and public to constitute use in commerce. Unlike other cases involving a single sale,97  the sale to USSOCOM was significant, amounting to over $634,000 in SCAR rifles.98    To fulfill its obligations under the contract, Plaintiff shipped firearms bearing the SCAR mark to various military institutions from the end of 2004 throughout 2005.

Moreover, evidence in the record suggests the US Military is a prominent and influential consumer in the firearms industry, and therefore, Plaintiff’s development and sale of the SCAR rifle pursuant to the USSOCOM Program could be viewed as sufficiently  public  for  trademark  protection  purposes.     Indeed,  several  witnesses testified that the US Military orders get first priority in the firearms industry, including Mr. Clyde who acknowledged that delivery of SCAR‐Stock from Sage was postponed because Sage had to dedicate its manufacturing capacity to fulfilling military orders first.  In addition, since the USSOCOM Program was the first open competition to create a new rifle in approximately forty years, the Program and Plaintiff’s participation in it generated publicity through numerous magazine and newspaper articles throughout 2005 and 2006.

Moreover, Plaintiff’s pre‐sale promotional activities for its civilian‐friendly SCAR assault rifle prior to September 2006 may constitute analogous use of the mark.  In that regard, Plaintiff promoted its SCAR rifles during visits to gun dealers and at trade shows, including the SHOT Show in Las Vegas, Nevada in February 2006, one of the largest tradeshows in the industry.  In addition, Plaintiff distributed brochures, t‐shirts, hats, and its 2006 product log bearing the SCAR mark or referencing its SCAR rifle at these events.  Finally, in March 2006, Plaintiff issued a press release announcing its plan to release a semi‐automatic version of its SCAR rifle to the law enforcement and civilian markets within the next two years.  Plaintiff, however, did not sell its SCAR rifle to law enforcement and civilian consumers until late 2008.

Whether these promotional activities constituted analogous use sufficient to give rise to a protectable trademark interest is a question of fact for the jury.  As mentioned above, to constitute analogous use, actual use must follow the promotional activities within a commercially reasonable time.  Here, approximately two years lapsed before Plaintiff sold its first SCAR rifle to law enforcement and civilian consumers, a delay one witness attributed to the need for prior government approval before release of a semi‐ automatic  SCAR  rifle  to  the  general  public.  Whether  such  a  delay  constitutes  a

“commercially reasonable time” within the firearms industry is an issue for the jury’s

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determination.

 

 

B.  Unlawful Use

 

 

Alternatively, Defendant argues Plaintiff cannot rely on its pre‐September 2006 promotional activities to show use of the SCAR mark because its advertisements and promotional activities violated federal regulations and thus cannot provide the basis for a protectable trademark interest in SCAR.

The United States Trademark Trial and Appeal Board interprets the  “use in

 

 

commerce” requirement to mean lawful use.99    In what has now become known as the “unlawful use doctrine” or the “unlawful use defense,” ʺthe sale or shipment of the product under the mark ha[s] to comply with all applicable laws and regulations” before a party may claim trademark protection for the mark.100

While the unlawful use defense has long been recognized by the Trademark Trial and Appeal Board, it has not been widely adopted by federal courts.101     The Ninth, Tenth, and Federal Circuits have expressly adopted the unlawful use defense.102  The

Eleventh Circuit has not adopted the defense; however, a district court in this Circuit has applied the defense in trademark infringement actions.103      Thus, the Court will

address Defendant’s arguments.  Having considered the merits of Defendant’s unlawful use defense, however, the Court finds it to be without merit.

“Unlawful use will be found where: (1) the issue of compliance has previously been determined (with a finding of non‐compliance) by a court or government agency having competent jurisdiction under the statute involved, or (2) where there has been a per  se violation  of  a  statute  regulating  the  sale  of  a  partyʹs  goods.”104       Not  every violation, however, will be sufficient to justify denial of trademark protection based on unlawful use.  There must be a nexus between the use of the mark and the violation, and the violation must be material.105     To be material, the violation must be of “such gravity and significance that the usage must be considered unlawful—so tainted that, as a matter of law, it could create no trademark rights.”106   A party raising the unlawful use defense must prove all these elements by clear and convincing evidence.107    “[T]he

 

 

 

 

103  See, e.g., Davidoff Extension S.A. v. Davidoff Intern., Inc., 612 F. Supp. 4, 7 (S.D. Fla. 1984) (holding that defendants failed to meet their burden of showing plaintiff unlawfully used the Davidoff mark in the sale of cigars by illegally selling cigars containing Cuban tobacco in the US); see also Kratom Lab, Inc. v. Mancini, No. 11‐80987‐CIV, 2013 WL 3927838, at *3‐5 (S.D. Fla. July 29, 2013) (finding plaintiff had no valid trademark in “Mr. Nice Guy” mark used on incense because plaintiff fraudulently misrepresented that the incense was not for human consumption but plaintiff’s principals pled guilty to violating the Analogue Act, 21 U.S.C. § 813, and admitted that they intended the product to be used for human consumption).

104 Dessert Beauty, Inc., 617 F. Supp. 2d at 190.

105  General Mills Inc. v. Health Valley Foods, 24 U.S.P.Q.2d 1270, 1274 (T.T.A.B. 1992) (citing Santinine Societa

v. P.A.B. Produits, 209 U.S.P.Q. 958 (T.T.A.B. 1988)).

106 General Mills, Inc., 24 U.S.P.Q.2d at 1274.

107 Dessert Beauty, Inc., 617 F. Supp. 2d at 190; Davidoff Extension S.A., 612 F. Supp. at 7.

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proofs submitted by the party [charging noncompliance] must leave no room for doubt

 

 

speculation, surmise, or interpretation.”108   Here, Defendant cannot meet this burden.

 

 

Defendant argues that Plaintiff’s use of the SCAR mark outside of its sales to the US Military constitutes a per se violation of Federal Acquisition Regulations (“FAR”) related to Department of Defense contracts, more specifically USSOCOM contracts regulated  under  the  USSOCOM  FAR  Supplement  (“SOFARS”).    SOFARS  Section

5652.204‐9003 prohibits those who contract with USSOCOM from releasing unclassified

 

 

information  regarding  those  contracts,  associating  themselves  with  USSOCOM  or Special Operation Forces, or using the USSOCOM emblem or logo, without prior authorization from USSOCOM.109

Defendant contends Plaintiff, through its advertisements and promotional materials, violated this regulation by printing unclassified information regarding Plaintiff’s participation in the USSOCOM Program and unlawfully attempting to associate its commercial SCAR rifle with USSOCOM by displaying the official emblem of US Special Operation Forces.   Defendant further argues that Plaintiff’s adoption of the SCAR mark constitutes an unlawful attempt to associate itself with USSOCOM in the commercial arena.

 

 

 

108 General Mills, Inc., 24 U.S.P.Q.2d at 1274 (quoting Santinine Societa, 209 U.S.P.Q. at 965).

109  Defendant cites to this regulation as “48 C.F.R. § 5652.204‐9003.” The Court, however, was unable to find the cited provision. The Court is relying on the text of the regulation as set forth in a letter from USSOCOM to Plaintiff’s subsidiary. Pl.’s Resp. to Def.’s Statement of Material Facts, Ex. 9 [Doc. 100‐3].

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The Court, however, cannot find Plaintiff’s activities constitute a per se violation

 

 

because Defendant fails to establish that the original contract between Plaintiff and

 

 

USSOCOM even incorporated the regulation prohibiting such conduct.   On May 14,

 

 

2010, USSOCOM addressed a letter to FNH USA, Plaintiff’s subsidiary, acknowledging the ambiguity as to whether the regulation even applied to Plaintiff’s contract.  In that letter, USSOCOM notified FNH USA that SOFARS Section 5652.204‐9003 provides that release  of  unclassified  information  related  to  USSOCOM  contracts  requires  prior written authorization.  However, USSOCOM further explained that “this guidance was not made clear in the contract, as the applicable contract clause that identifies this guidance had not yet been established at the time of the contract award. Therefore, a unilateral modification to the contract incorporating SOFARS clause 5652.204‐9003 will be issued.”110     Because USSOCOM acknowledged that the guidance regarding the applicability of this regulation to Plaintiff’s contract was unclear, the Court cannot find that  Plaintiff’s  advertisements  in  2006  constituted  a  per  se violation  of  federal regulations.

Even  if  Plaintiff’s  advertisements  constituted  a  per  se violation,  any  such violation is  immaterial.                     One  of the  primary purposes behind trademark law is to

 

 

 

 

 

 

 

110 Pl.’s Resp. to Def’s Statement of Undisputed Facts, Ex. 9 at FN102837 [Doc. 100‐3].

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protect the consumer.111     Unlike the cases cited by Defendant involving violations of

 

 

Food and Drug Administration regulations, the violation here does not implicate consumer protection concerns.  On the contrary, the regulation was enacted to protect USSOCOM.   Thus, even if Plaintiff’s use of SCAR in its pre‐sale promotional advertisements constituted a per se violation, the violation was immaterial and therefore nullifies Defendant’s unlawful use defense.112

Because Defendant cannot proceed with its unlawful use defense, the jury may

 

 

consider evidence of Plaintiff’s pre‐sale promotional activities when determining whether those activities, coupled with Plaintiff’s sale of SCAR rifles pursuant to the USSOCOM Program, constitute sufficient prior use of the mark in commerce to create a protectable trademark interest in SCAR prior to September 2006.

II.        Distinctiveness of SCAR and SCAR‐Stock

 

 

In addition to showing use of the mark in commerce, the parties must also show that SCAR and SCAR‐Stock are distinctive in order to receive trademark protection.113

A distinctive mark is one that “serve[s] the purpose of identifying the source of the

 

 

 

 

 

111 See Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 774 (1992) (noting that the dual purpose behind the Lanham Act is to “secure to the owner of the mark the goodwill of his business and to protect the ability of consumers to distinguish among competing producers.”).

112 See S. California Darts Assʹn v. Zaffina, 762 F.3d 921, 931‐32 (9th Cir. 2014) (finding unlawful use defense

failed, in part, because“[e]ven assuming that [plaintiff] unlawfully failed to pay taxes, its misconduct would be unrelated to the purpose of the federal trademark laws and, therefore, collateral and immaterial.”) (emphasis added).

113 Knights Armament Co., 654 F.3d at 1188.

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goods  or  services.”114        “An  identifying  mark  is  distinctive  and  capable  of  being

 

 

protected if  it  either (1)  is inherently distinctive or (2)  has acquired distinctiveness

 

 

through secondary meaning.”115   In that regard, trademark law recognizes the following

 

 

four categories of distinctiveness:

 

 

(1) generic—marks that suggest the basic nature of the product or service; (2) descriptive—marks that identify the characteristic or quality of a product or service; (3) suggestive—marks that suggest characteristics of the product or service and require an effort of the imagination by the consumer in order to be understood as descriptive; and (4) arbitrary or fanciful—marks that bear no relationship to the product or service, and the strongest category of trademarks.116

Arbitrary, fanciful, and suggestivetrademarksare considered inherently distinctive and, therefore, are protectable without a showing of secondary meaning.117     A descriptive mark, by contrast, is not inherently distinctive, and receives trademark protection only if it acquires distinctiveness through secondary meaning.118    A descriptive mark has acquired distinctiveness through secondary meaning “when the primary significance of the  [mark]  in  the  minds  of  the  [consuming]  public  is  not  the  product  but  the producer.”119    The key factor in determining whether a descriptive mark has acquired secondary meaning is how the mark is perceived by the average prospective consumer

 

 

 

 

 

114 Id.

115 Two Pesos, Inc., 505 U.S. at 769 (emphasis in original).

116 Gift of Learning Found., Inc., 329 F.3d at 797‐98.

117 Coach House Rest., Inc. v. Coach & Six Restaurants, Inc., 934 F.2d 1551, 1560 (11th Cir. 1991).

118 Knights Armament Co., 654 F.3d at 1188.

119 Welding Servs., Inc. v. Forman, 509 F.3d 1351, 1358 (11th Cir. 2007).

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in the relevant industry.120    Whether a mark is distinctive is a question of fact not easily

 

 

adjudicated on summary judgment.121

 

 

Here, both parties argue no genuine issue of material fact exists as to whether their respectivetrademarksare distinctive.  This Court disagrees.

A. Distinctiveness of Plaintiff’s SCAR Mark

 

 

Plaintiff argues that its SCAR mark is inherently distinctive, or alternatively, if it is descriptive, it has acquired distinctiveness through secondary meaning.  In response, Defendant argues that Plaintiff’s use of the SCAR mark was merely descriptive of the firearms solicited by the USSOCOM Program, and the mark did not acquire secondary meaning in the firearms industry prior to Defendant’s first use of SCAR‐Stock in September 2006.   As explained below, facts support both parties’ positions, and, therefore, a genuine issue of material fact remains as to whether Plaintiff’s SCAR mark is merely descriptive or inherently distinctive of the rifles upon which it is used.

When determining the distinctiveness of an abbreviation or acronym such as SCAR,  the  Court  must  consider  the  relationship  between  the  acronym  and  its underlying phrase.122   For classification purposes, an abbreviation is treated similarly to its  underlying  phrase  “where  the  average  prospective  consumer  recognizes  the

 

 

 

120 G. Heileman Brewing Co. v. Anheuser‐Busch, Inc., 873 F.2d 985, 995 (7th Cir. 1989).

121 Xtreme Lashes, LLC v. Xtended Beauty, Inc., 576 F.3d 221, 232 (5th Cir. 2009).

122  Knights Armament Co. v. Optical Sys. Tech., Inc., 647 F. Supp. 2d 1321, 1331 (M.D. Fla. 2009), affʹd, 654

F.3d 1179 (11th Cir. 2011).

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abbreviation as equivalent to the underlying phrase.”123    “An abbreviation of a generic

 

 

or descriptive phrase is protectable ‘if the party claiming protection for the abbreviation shows that the abbreviation has a meaning distinct from the underlying words in the mind of the public.’”124      When determining how the public views the mark, courts should consider sources such as consumer surveys, use of the mark in media publications, use of the mark by competitors in the industry, and the trademark claimant’s use of the mark.125     After considering these factors in this case, the Court finds a genuine issue of material fact exists as to whether SCAR is distinctive.

On the one hand, SCAR may be considered descriptive of a type of rifle because it serves as an acronym for “Special Operation Forces Combat Assault Rifle”—a descriptive phrase used to designate a particular rifle requested by the USSOCOM Program.  Indeed, evidence in the record shows that Plaintiff and others associated the term SCAR with this underlying descriptive phrase.  For example, the majority of the newspaper and magazine articles reference SCAR in connection with “Special Combat Assault  Rifle”  or  some  variant  thereof.    In  addition,  a  representative  for  another firearms manufacturer testified that he recognized SCAR as an identifier of the rifles

 

 

 

 

 

 

123Am. Historic Racing Motorcycle Assʹn, Ltd. v. Team Obsolete Promotions, 33 F. Supp. 2d 1000, 1004 (M.D. Fla. 1998), affʹd sub nom., Am. Historic v. Team Obsolete, 233 F.3d 577 (11th Cir. 2000).

124 Knights Armament Co., 647 F. Supp. 2d at 1331 (quoting Forman, 509 F.3d at 1359).

125 See Colt Defense LLC v. Bushmaster Firearms, Inc., 486 F.3d 701, 706 (1st Cir. 2007).

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solicited by the USSOCOM Program.126    Even Plaintiff’s own subsidiary indicated that

 

 

SCAR is recognized as an acronym in government jargon to refer to the USSOCOM Program.

Moreover, Plaintiff’s own use of SCAR with its underlying phrase could support a finding that the mark is descriptive.   If a trademark claimant uses the acronym in conjunction with its underlying phrase, courts are reluctant to find that the acronym has an independent meaning apart from the underlying phrase.127      In several of its advertisements and promotional materials, Plaintiff displays the SCAR mark with the underlying phrase presented predominately beside or underneath it.   For example, Plaintiff places the two side by side in its March 2006 press release entitled “The Making of the 21st Century Assault Rifle: SCAR SOF Combat Assault Rifle.”128   Because SCAR is used at times with Special Operation Forces Combat Assault Rifle, the public could perceive that SCAR does not have a meaning distinct from its underlying phrase, and, by extension, is merely descriptive of a type of rifle.

On the other hand, because SCAR has an ordinary meaning outside the firearms industry, and no other competitors in the market use the mark commercially, the mark

 

 

126 Paul Hochstrate Dep. 19:25‐20:18 [Doc. 91‐6].

127 See, e.g., Forman, 509 F.3d at 1360 (finding that party failed to show “WSI” as abbreviation for “Welding

Services Inc.” had a distinct meaning apart from the underlying phrase because advertising material displayed the WSI logo next to the underlying phrase);  Knights Armament Co., 647 F. Supp. 2d at 1331 (finding that party failed to show “UNS” had a distinct meaning where the party “consistently use[d] UNS in conjunction with and as an abbreviation of ‘Universal Night Sight.’”).

128 Mills Dep., Ex. 4 [Doc. 89‐5].

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could be viewed as inherently distinctive. “Scar” is a common word in the English

 

 

language signifying a mark left on the skin by the healing of injured tissue.129    To the extent that the public views SCAR as synonymous with its dictionary definition, the mark would be inherently distinctive because the word bears no relationship to the firearm upon which it is used.  Indeed, such a connotation would be creatively fitting for a firearm capable of causing bodily injury.   Plaintiff even attempts to invoke this alternative meaning of “scar” in one of its SCAR rifle advertisements by including the words “BATTLE SCARS.”130   Because the word doubles as both a mark on the skin and as an acronym for Special Operation Forces Combat Assault Rifle, the public could view the mark as inherently distinctive.131

Another factor that weighs in favor of finding Plaintiff’s SCAR mark distinctive is the fact that other competitors in the firearms industry do not use the mark commercially.  If other competitors in the market use the mark, then that is probative evidence that the mark is merely descriptive or generic because, the more the public sees the mark used by others in the industry, the less likely the public will identify the mark with one particular producer.132    Here, there is no evidence in the record showing

 

 

129 Umansky Decl., Ex. 6 [Doc. 89‐3].

130 Def.’s Statement of Material Facts, Ex. H at FN100415 [Doc. 90‐8].

131  Accord American Historic Racing Motorcycle Association, Ltd., 33 F. Supp. 2d 1000, 1004‐05 (M.D. Fla.

1998)   (holding that “BEARS,” an abbreviation for “British‐European‐American‐Racing Series” was inherently distinctive for a class of motorcycles, in part, because BEARS doubled as both an animal and as an abbreviation, and thus consumers may associate the word with multiple things).

132 See Colt Defense LLC, 486 F.3d at 706.

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that competitors, other than Defendant, use the SCAR mark to sell firearms or related

 

 

products.  Therefore, a reasonable juror could find that SCAR is inherently distinctive.

 

 

B.  Distinctiveness of Defendant’s SCAR‐Stock Mark

Similarly,  Defendant  argues  its  SCAR‐Stock  mark  is  inherently  distinctive because  it  is an  arbitrary  acronym for “Sage Clyde  Armory Rifle Stock,” a  phrase

 

 

adopted to reflect the origin of the product’s design.   Plaintiff, however, argues that

 

 

Defendant’s position that SCAR‐Stock is inherently distinctive is inconsistent and contradicts its position that Plaintiff’s SCAR mark is merely descriptive.  According to Plaintiff,  SCAR  is  either  inherently  distinctive  for  firearm  products  or  it  is  not; Defendant cannot have it both ways. This Court disagrees.

When determining whether a mark is distinctive, the factfinder must look to the particular goods or services upon which the mark is used.133   The same mark “may shift categories depending upon the product to which it is affixed.”134     Here, the products upon which Plaintiff and Defendant use their respectivetrademarksare different: one is a type of firearm (a rifle) and the other is replacement gun stock (i.e., a gun accessory) compatible  with  Ruger  rifles.    Because  the trademarks are  used  to  designate  different

products, the  factfinder could also  determine that  their distinctiveness differs.   An

 

 

 

 

133   See 2 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 11:16 (4th ed.) (“The

possible descriptiveness of a designation is highly dependent on the goods or services in connection with which the designation is used. A term can be descriptive of one product and nondescriptive of another.”).

134 Polo Fashions, Inc. v. Extra Special Products, Inc., 451 F. Supp. 555, 559 (S.D.N.Y. 1978).

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illustrative example of this principle is the “polo” mark in the clothing industry.  One

 

 

district court noted held that the “polo” mark “[is] generic to polo shirts and coats, descriptive as to other shirts and coats and fanciful as it is applied to other articles of wearing apparel.”135    Although the products were sold in the same industry, i.e. the clothing market, the distinctiveness of the mark changed based on the type of clothing. Similarly, in this case, although SCAR and SCAR‐Stock are both used in the firearms industry, the products upon which they are used differ.  Thus, the factfinder could find that the distinctiveness of SCAR and SCAR‐Stock also differ.136

Nevertheless, given the conflicting evidence regarding Defendant’s motive in adopting the mark, the Court finds a genuine issue of material fact exists as to whether SCAR‐Stock actually serves as an acronym for the product’s origin.   Although Mr.

Clyde testified that SCAR‐Stock is an acronym for “Sage Clyde Armory Rifle Stock,”

 

 

Mr. Clyde knew of the USSOCOM Program and that the rifle developed pursuant to

 

 

the Program was known as the SCAR rifle at the time he adopted the SCAR‐Stock

 

 

 

135 Id.

136   Plaintiff  further  argues  that  Defendant’s  position  contradicts  its  argument  made  to  the  USPTO following  denial  of  its  SCAR‐Stock  application  on  descriptiveness  grounds.    Specifically,  Plaintiff contends  Defendant  admitted  that  SCAR  could  not  be  both  descriptive  and  distinctive  as  used  on firearms products. In response to the initial denial of its application, Defendant stated “[i]t seems incongruous to suggest that a term like SCAR, which has no dictionary definition connected to firearms, rifles or gun stocks, is both descriptive of a type of assault rifle and at the same time a distinctive trademark for a particular brand of assault rifle.” Def.’s Statement of Material Facts, Ex. D [Doc. 90‐4]. While the Court recognizes the tension between these two arguments, they are not wholly inconsistent because the argument before USPTO refers to the use of SCAR specifically on rifles.   Defendant’s arguments to the USPTO are merely additional evidence for the jury to weigh in its determination of distinctiveness.

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mark.    Further,  Joshua  Smith,  Defendant’s  former  COO,  testified  that  Defendant

 

 

adopted the SCAR‐Stock mark, in part, to take commercial advantage of the popularity of  the  SCAR  rifle.    Although  Mr.  Clyde  specifically  disclaims  any  bad  faith  and attempts to cast doubt on Smith’s credibility, it is not the province of this Court to weigh the evidence or make credibility determinations at the summary judgment stage.137     Accordingly, a genuine issue of material fact exists as to the reasons for adopting, and the meaning behind, Defendant’s mark.  Therefore, whether the mark is distinctive is a question for the jury.

CONCLUSION

 

 

Based on the foregoing, the Court finds that genuine issues of material fact exists as to which party first used the mark in commerce and whether either or both parties’trademarksare distinctive.   Because these issues are central to all the claims raised in this case, the parties Motions for Summary Judgment [Docs. 84 & 85] are DENIED.

SO ORDERED, this 8th day of January, 2015.

 

 

 

 

 

 

 

 

ADP/ssh/jrf
S/ C. Ashley Royal

C. ASHLEY ROYAL

UNITED STATES DISTRICT JUDGE

 

 

 

 

 

 

 

 

 

 

 

137Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).

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23Jan/160

Lilenfeld PC Discusses Trademark Infringement Order

Below is a copy of Judge Thrash’s Order in Bel v. Foster, Civil Action File No. 1:13-Cv-405-Twt, in the United States District Court For The Northern District Of Georgia (Atlanta).  The Order contains a good discussion of the seven factor likelihood of confusion analysis adopted by the Eleventh Circuit Court of Appeals.  The Court also has a thorough discussion of damages available to the trademark owner for trademark infringement, as well as injunctive relief available.

OPINION AND ORDER

This is a trademark infringement action concerning the late Jack Gibson’s alias “Jack the Rapper.” It is before the Court on the Plaintiffs’ Motion for Summary Judgment against the Defendant Billy Darren Foster [Doc. 38]. For the reasons set forth below, the Plaintiffs’ Motion is GRANTED in part and DENIED in part.

I. Background (David Lilenfeld: Here is a detailed discussion of the facts giving rise to this trademark infringement dispute)

From the late 1940s until his death on January 30, 2000, Jack Gibson was well known as the radio personality “Jack the Rapper.” (Pls.’ Statement of Facts ¶ 1.) He founded the National Association of Radio Announcers for Black Radio DJs, was the first National Director of Promotions and Public Relations for Motown Records, and opened the first African American owned and operated radio station in the United States. (Id. ¶ 3.) From 1977 until his death, Jack Gibson also hosted an annual event for radio and music artists called “Jack the Rapper’s Family Affairs Convention.” (Id. ¶ 5.) Many rhythm, blues, hip hop, and rap artists attended every year. (Id.) The “Jack the Rapper” alias is still used today in reference to Jack Gibson. (Id. ¶ 4.) Gibson’s heirs and licensees continue to promote the alias. (Id. ¶ 2.) Since 2007, the Jus’ Blues Music Foundation in Memphis, Tennessee has annually awarded the “Jack the Rapper Gibson Radio Pioneer Award.” (Id. ¶ 6.)

The Defendant Billy Foster, in concert with the other Defendants, hosted a series of events in different cities. Each was titled “The New Jack the Rapper Convention.” The first one was held in Atlanta, Georgia from December 6, 2012 to December 8, 2012. (Id. ¶ 13.) Prior to the Atlanta Convention, Foster contacted the Plaintiff Jill Bell through e-mail and expressed his interest in doing a tribute to Jack Gibson. (Id. ¶ 10.) Once Bell realized that Foster and the other Defendants were planning on using “Jack the Rapper” in the event’s title, she communicated her objection to no avail. (Id. ¶ 13.) Foster went on to file a trademark application for the title “The New Jack the Rapper Convention.” (Id. ¶ 12.) A second “New Jack the Rapper Convention” was then advertised and held in Houston, Texas from February 14, 2013 to February 16, 2013. (Id. ¶ 14.) Prior to the Houston Convention, on February 6, 2013, the Plaintiffs filed for a temporary restraining order to enjoin it. (Id.¶ 15.) A hearing was held over the TRO application on February 8, 2013, and the Plaintiffs entered into a Settlement Agreement with Foster. (Id. ¶ 16.)

Under this Agreement, Foster was to:

(1) pay to Plaintiffs $1,000.00 within three days;

(2) pay to Plaintiffs $5,000.00 on or before February 16, 2013;

(3) pay for Plaintiff Jill Bell or her representative, up to $1,000.00, to attend the

Houston, Texas convention;

(4) provide Plaintiffs with access to their books and records with respect to the

Houston, Texas convention;

(5) pay to Plaintiffs ten percent of the gross registration fees and sponsorship

revenues from their use of the “Jack the Rapper” mark as a license fee; and

(6) withdraw and cancel, upon execution of a licensing agreement, their federal

trademark application for “The New Jack the Rapper Convention,” serial

number 85787701, filed November 27, 2012.

(Id. ¶ 17; Pls.’ Mot. for Summ. J., Ex. C.) Foster made the initial $1,000.00 payment and covered a portion of the travel expenses for Bell’s representative to attend the Houston Convention. (Pls.’ Statement of Facts ¶¶ 19-21.) Foster did not fulfill the remaining obligations in the Settlement Agreement. (Id. ¶ 22.) A third “New Jack the Rapper Convention” was then held in New York City from April 18, 2013 to April 21, 2013. (Id. ¶ 23.)

It is undisputed that Foster used the “Jack the Rapper” mark when promoting these Conventions. (Id. ¶ 24.) The mark was also used to promote and sell products and services associated with the Conventions. (Id. ¶ 27.) Aside from the Settlement Agreement which covered the Houston Convention, the Plaintiffs never gave Foster permission to use the “Jack the Rapper” mark. (Id. ¶¶ 28, 30.) Foster did not receive permission from any other source. (Id. ¶ 31.) The Plaintiffs asserted claims for trademark infringement under 15 U.S.C. § 1125(a), trademark dilution under 15 U.S.C. § 1125(c), trademark infringement under Georgia law, unfair competition under Georgia law, and infringement of the right of publicity under Georgia law. The Plaintiffs now move for summary judgment against the Defendant Foster. Foster did not file a response.

II. Summary Judgment Standard (David Lilenfeld: Good summary of the law used to resolve a Motion for Summary Judgment in a trademark infringement case)

Summary judgment is appropriate only when the pleadings, depositions, and affidavits submitted by the parties show that no genuine issue of material fact exists and that the movant is entitled to judgment as a matter of law. FED. R. CIV. P. 56(c).

The court should view the evidence and any inferences that may be drawn in the light most favorable to the nonmovant. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59 (1970). The party seeking summary judgment must first identify grounds that show the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). The burden then shifts to the nonmovant, who must go beyond the pleadings and present affirmative evidence to show that a genuine issue of material fact does exist. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257 (1986). "A mere 'scintilla' of evidence supporting the opposing party's position will not suffice; there must be a sufficient showing that the jury could reasonably find for that party." Walker v. Darby, 911 F.2d 1573, 1577 (11th Cir.1990). The Court “cannot base the entry of summary judgment on the mere fact that the motion was unopposed, but, rather, must consider the merits of the motion.” United States v. One Piece of Real Prop. Located at 5800 SW 74th Ave., Miami, Fla., 363 F.3d 1099, 1101 (11th Cir. 2004). However, the Court “need not sua sponte review all of the evidentiary materials on file at the time the motion is granted, but must ensure that the motion itself is supported by evidentiary materials.” (1 Id).

III. Discussion (David Lilenfeld: This is the “meat” of the Order (i.e., getting to the good stuff))

A. Trademark Infringement

The Plaintiffs’ “claims for trademark infringement under Georgia common law and unfair competition under Georgia common law and O.C.G.A. § 23-2-55 are governed by the same standard as [the Plaintiffs’] trademark infringement claim[] under the Lanham Act.” Alaven Consumer Healthcare, Inc. v. DrFloras, LLC, No. 1

Requests for admission were sent to Foster. He did not reply. “A matter is admitted unless, within 30 days after being served, the party to whom the request is directed serves on the requesting party a written answer or objection addressed to the matter and signed by the party or its attorney.” FED. R. CIV. P. 36(a)(3).

Thus, the Court need only resolve whether the Plaintiffs are entitled to judgment as a matter of

law on their section 1125(a) claim.  Section 43(a) of the Lanham Act creates a federal cause of action for the infringement of trademarks, regardless of registration status. 15 U.S.C. § 1125(a).

“To establish a prima facie case of trademark infringement under § 43(a), a plaintiff must show (1) that it had trademark rights in the mark or name at issue and (2) that the other party had adopted a mark or name that was the same, or confusingly similar to its mark, such that consumers were likely to confuse the two.” Tana v. Dantanna’s, 611 F.3d 767, 773 (11th Cir. 2010) (internal quotation marks omitted).

(1) Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which:

(A) is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or

(B) in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities, shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act. 15 U.S.C. § 1125(a).

Here, the Plaintiffs had a proprietary right in the mark “Jack the Rapper” as used in the market for radio and music conventions. “[A] plaintiff need not have a registered mark.” Id. “However, only those marks that are capable of distinguishing the owner’s goods from those of others, i.e., that are sufficiently ‘distinctive,’ are eligible for federal registration or protection as common law marks under the Lanham Act.” Id. There are four categories of distinctiveness: “(1) generic--marks that suggest the basic nature of the product or service; (2) descriptive--marks that identify the characteristic or quality of a product or service; (3) suggestive--marks that suggest characteristics of the product or service and require an effort of the imagination by the consumer in order to be understood as descriptive; and (4) arbitrary or fanciful—marks that bear no relationship to the product or service, and the strongest category of trademarks.” Id. at 774. In this context, “Jack the Rapper” is at minimum a suggestive mark. It does not reference the particular service in question: hosting radio and music conventions. By using the word “rapper” it only alludes to the nature of the conventions. It is entitled to trademark protection. See id. (“Suggestive . . . marks are deemed ‘inherently distinctive’ because ‘their intrinsic nature serves to identify a particular source of a product’ and are generally entitled to trademark protection.”).

“The New Jack the Rapper Convention” was likely to mislead consumers into believing that it was endorsed by those with the right to the mark “Jack the Rapper.”

(David Lilenfeld: the seven factor likelihood of confusion analysis begins here:)

“In evaluating whether there is a likelihood of confusion between two marks, [the Court] applies a multifactor test, evaluating the following seven factors: (1) strength of the mark alleged to have been infringed; (2) similarity of the infringed and infringing marks; (3) similarity between the goods and service offered under the two marks; (4) similarity of the actual sales methods used by the holders of the marks, such as their sales outlets and customer base; (5) similarity of advertising methods; (6) intent of the alleged infringer to misappropriate the proprietor’s good will; and (7) the existence and extent of actual confusion in the consuming public.” Id. at 774-75.

“In this circuit, we are required to consider each of the seven factors.” Welding Services, Inc. v. Forman, 509 F.3d 1351, 1361 (11th Cir. 2007). (David Lilenfeld: Here, Judge Thrash applies the law to the particular facts of this trademark infringement lawsuit:) Six out of the seven factors support finding a likelihood of confusion. First, “[t]he strength of a trademark is essentially a consideration of distinctiveness.” Trilink Saw Chain, LLC v. Blount, Inc., 583 F. Supp. 2d 1293, 1310 (N.D. Ga. 2008)

(internal quotation marks omitted). As noted, the mark is “inherently distinctive” because it is only suggestive of the service. “The . . . more distinctive a trademark . . . the greater the likelihood of confusion and the greater the scope of protection afforded it.” Welding Services, 509 F.3d at 1361. The second factor also favors the Plaintiffs. Each Convention was given a title that included the protected mark: “The New Jack the Rapper Convention.” (Pls.’ Statement of Facts ¶¶ 9, 14, 23.) It is true that this includes additional words aside from “Jack the Rapper.” However, whether “an addition is sufficient to prevent confusion in a particular instance depends upon the strength of the main part of the mark and the distinctiveness of the mark and the distinctiveness of the additional feature.” Safeway Stores, Inc. v. Safeway Discount Drugs, Inc., 675 F.2d 1160, 1166 (11th Cir. 1982) (internal quotation marks omitted).

Here, of course, the mark “Jack the Rapper” is not only distinctive, but it was the focal point of the Conventions’ titles. Third, the services offered by Foster and the other Defendants were similar to those offered by Jack Gibson himself. They all hosted conventions for radio and music artists. The fourth and fifth factors also favor the  Plaintiffs. Foster targeted the same subsection of the music industry that Jack Gibson had targeted for his conventions, and Foster advertised in the same major market (Atlanta, Georgia). (Pls.’ Mot. for Summ. J., at 11; Bell Aff. ¶ 7.) The sixth factor favors the Plaintiffs as well. Foster intended to misappropriate “Jack the Rapper’s” goodwill. This inference may be drawn from his use of the highly distinctive mark itself. In addition, Foster contacted the Plaintiff Bell to express his interest in putting together a tribute to Jack Gibson. (Pls.’ Statement of Facts ¶ 10.) Thus, Foster certainly used the mark “Jack the Rapper” intending to capitalize on the popularity of Jack Gibson’s radio personality. The seventh factor, however, does not favor the Plaintiffs. They have not supplied any evidence of actual confusion. Nevertheless, the remaining factors are sufficient to show that there is a likelihood of confusion.

(David Lilenfeld: Here, the Court discusses the damages available to plaintiff in this trademark infringement lawsuit) The Plaintiffs are entitled to damages. They may recover (1) Foster’s profits, (2) any damages they sustained, and (3) the costs of this action. 15 U.S.C. § 1117(a). Here, further discovery is necessary to establish the amount that the Plaintiffs may recover. First, the Plaintiffs assert that they are entitled to the "$15,000 profits realized by [Foster] by reason of his unlawful acts," as well as treble damages. (Pls.' Mot. For Summ. J., at 21-22.) The Plaintiffs claim that this amount is derived from the Settlement Agreement that the parties reached regarding “The New Jack the Rapper Convention” held in Houston, Texas. This does not, however, speak to Foster’s profits from the Conventions held in Atlanta, Georgia and New York City. The record lacks evidence necessary to calculate Foster's profits for those two Conventions. Second, the Plaintiffs assert that they suffered damages in the amount of $36,000. The evidence in the record does not support this. For example, the Plaintiffs claim that they would have received $25,000 from a "Jack the Rapper" conference that they planned on holding in Atlanta in August 2013. (Pls.’ Mot. for Summ. J., at 21-22.)

There is no evidence indicating that they would have made $25,000. There is also no argument for why they were prohibited from holding this conference and no evidence indicating that -- due to Foster's infringement -- they would have made less money if they had held it. The Plaintiffs also allege that they lost $10,000 from the "loss of value in licensing Plaintiffs' trademark to persons other than Defendants for other Jack the Rapper events." (Pls.’ Mot. for Summ. J., at 22.) This suffers from the same evidentiary deficiencies. The Plaintiffs further allege that they are entitled to $1,000 pursuant to the Settlement Agreement. This may be true, but these are not damages that they are entitled to under section 1117(a).

(David Lilenfeld: This is the detailed Court discussion about injunctive and equitable relief in this trademark infringement action) The Plaintiffs also request equitable relief. The Court may “grant injunctions, according to the principles of equity and upon such terms as the court may deem reasonable . . . to prevent a violation under subsection (a).” 15 U.S.C. § 1116(a). Here, the Plaintiffs are entitled to injunctive relief but not in the form they suggest. They request that the Court issue an injunction with six vague, overly broad provisions. For example, they request that Foster be enjoined from “using in any manner any of the Plaintiffs’ Marks, including the Jack the Rapper Mark, or any other mark which so resembles said trademark as to be likely to cause confusion, deception, or mistake, on or in connection with . . . sale of any goods or services not emanating from Plaintiffs,” and that he be enjoined from “otherwise competing unfairly with Plaintiffs in any manner.” (Pls.’ Mot. for Summ. J., at 19-20.) "Every order granting an injunction . . . must . . . (B) state its terms specifically; and (C) describe in reasonable detail . . . the act or acts restrained or required." FED. R. CIV. P. 65(d)(1). "A court order should be phrased in terms of objective actions, not legal conclusions." S.E.C. v. Goble, 682 F.3d 934, 950 (11th Cir. 2012) (internal quotation marks omitted). The specificity requirement is "designed to prevent uncertainty and confusion on the part of those faced with injunctive orders, and to avoid the possible founding of a contempt citation on a decree too vague to be understood." Schmidt v. Lessard, 414 U.S. 473, 476 (1974). The Plaintiffs’ requested wording is too vague. See John H. Harland Co. v. Clarke Checks, Inc., 711 F.2d 966, 985 (11th Cir. 1983) (“[T]he injunction should clearly let defendant know what he is ordered to do or not to do. . . .[a]n injunction which merely forbids a defendant from performing ‘acts of unfair competition,’ or from “infringing on plaintiff's trademarks and trade secrets” adds nothing to what the law already requires.”). The Plaintiffs also do not specify the other marks that they believe are protected aside from “Jack the Rapper.” The Court will limit the injunction to the specified infringing acts. Thus, the injunction should bar Foster from using the “Jack the Rapper” mark, or causing the “Jack the Rapper” mark to be used, in connection with conventions catering to the radio and music industries, as well as associated services and merchandise.

The Plaintiffs also generally request that the Foster turn over, for destruction, certain items bearing the "Jack the Rapper" mark. (Pls.’ Mot. for Summ. J., at 20-21.) The Court may grant such relief under 15 U.S.C. § 1118. However, there is no evidence in the record regarding what these items are, or that Foster possesses them. To the extent that the Plaintiffs allege that certain goods and services were sold in application he filed with the United States Patent and Trademark Office, (Pls.’ Mot. for Summ. J., Ex. B), to register the mark “The New Jack the Rapper Convention.”

The Plaintiffs also seek attorneys' fees. "The court in exceptional cases may award reasonable attorney fees to the prevailing party." 15 U.S.C. § 1117(a). "While Congress has not further defined 'exceptional,' the legislative history of the Act suggests that exceptional cases are those where the infringing party acts in a 'malicious,' 'fraudulent,' 'deliberate,' or 'willful' manner." Burger King Corp. v. Pilgrim's Pride Corp., 15 F.3d 166, 168 (11th Cir. 1994) (citing H.R. Rep. No. 93-524, 93rd Cong., 1st Sess. (1974), reprinted in 1974 U.S.C.C.A.N. 7132, 7133). Here, attorneys’ fees are appropriate. Foster used the protected mark "Jack the Rapper" knowing that it was the distinctive alias of Jack Gibson. That is precisely why he used it. The Plaintiffs are entitled to attorneys' fees in the amount of $11,994.86. (Pls.' Mot. for Summ. J., at 23.) The Plaintiffs also ask for punitive damages. However, connection with the infringing conventions, the injunction will prohibit further sale of those goods and services by Foster.

Other courts have also issued injunctions requiring an infringer to withdraw a trademark application. See, e.g., A.V. By Versace, Inc. v. Gianni Versace, S.p.A., 96 CIV.9721-PKL-THK, 2004 WL 691243 (S.D.N.Y. Mar. 31, 2004) (The defendant “was obligated under the preliminary injunction to withdraw all such applications and registrations made or granted throughout the world . . ..”); Simon Prop. Grp., L.P. v. mySimon, Inc., IP 99-1195-C H/G, 2001 WL 66408 (S.D. Ind. Jan. 24, 2001); A.C. Legg Packing Co., Inc. v. Olde Plantation Spice Co., Inc., 61 F. Supp. 2d 426 (D. Md. 1999).

“Punitive damages are not available under the Lanham Act.” Rain Bird Corp. v. Taylor, 665 F. Supp. 2d 1258, 1272 (N.D. Fla. 2009); see also Huddle House, Inc. v. Two Views, Inc., 1:12-CV-03239-RWS, 2013 WL 1390611, at *5 (N.D. Ga. Apr. 4, 2013); Babbit Electronics, Inc. v. Dynascan Corp., 38 F.3d 1161, 1183 (11th Cir. 1994) ("Such an award is discretionary, but it may not be punitive, and must be based on a showing of actual harm.").

B. Trademark Dilution Under Section 1125(c)

A plaintiff is entitled to injunctive relief if (1) the plaintiff owns a distinctive famous mark, (2) another person began using a mark after the plaintiff’s mark became famous, and (3) the person’s mark is likely to cause “dilution by blurring” or “dilution by tarnishment” of the plaintiff’s famous mark. See 15 U.S.C. § 1125(c)(1).

A plaintiff does not need to show actual or likely confusion, competition, or actual economic injury for this claim. See id. Here, “Jack the Rapper” is a famous mark. “[A] mark is famous if it is widely recognized by the general consuming public of the United States as a designation of "[T]he owner of a famous mark that is distinctive, inherently or through acquired distinctiveness, shall be entitled to an injunction against another person who, at any time after the owner's mark has become famous, commences use of a mark or trade name in commerce that is likely to cause dilution by blurring . . . of the famous mark, regardless of the presence or absence of actual or likely confusion, of competition, or of actual economic injury."15 U.S.C. § 1125(c)(1). Source of the goods or services of the mark’s owner.” 15 U.S.C. § 1125(c)(2)(A). The Court may look to factors such as: (1) “[t]he duration, extent, and geographic reach of advertising and publicity of the mark, whether advertised or publicized by the owner or third parties”; (2) “[t]he amount, volume, and geographic extent of sales of goods or services offered under the mark”; (3) “[t]he extent of actual recognition of the mark”; and (4) [w]hether the mark was registered . . ..” 15 U.S.C. § 1125(c)(2)(A)(i)-(iv). Although the “Jack the Rapper” mark is not registered, multiple factors suggest that it is famous. Jack Gibson began using this alias in the late 1940s, and it has been promoted throughout the world ever since. (Pls.’ Statement of Facts ¶¶ 1-2, 4.) Jack Gibson used this alias in connection with his radio programming as well as the conventions he hosted for those in the radio and music industries. (Id. ¶¶ 5.) This mark is widely recognized. (Id. ¶¶ 4, 6, 10.) Further, there is no dispute that the Conventions hosted by the Defendants were held after the “Jack the Rapper” mark became famous.

To satisfy the third prong, the Plaintiffs argue that the title “The New Jack the Rapper Convention” “dilutes by blurring” the “Jack the Rapper” mark. “‘[D]ilution by blurring’ is association arising from the similarity between a mark or trade name and a famous mark that impairs the distinctiveness of the famous mark.” 15 U.S.C. § 1125(c)(2)(B). The Court must consider factors similar to those assessed in the “likelihood of confusion” analysis for the section 1125(a) claim.

The Court need not reiterate the same conclusions. The Plaintiffs have established that Foster’s use of “Jack the Rapper” in naming the Conventions impairs the distinctiveness of the mark.

C. Right of Publicity (David Lilenfeld: A rare discussion of Right of Publicity under Georgia law, especially in a trademark infringement case)

"Violation of the right of publicity is a state tort." Toffoloni v. LFP Publ'g Grp., LLC, 572 F.3d 1201, 1205 (11th Cir. 2009). "[T]he appropriation of another's name and likeness . . . without consent and for the financial gain of the appropriator is a tort in Georgia, whether the person whose name and likeness is used is a private citizen, entertainer, or . . . a public figure who is not a public official." Martin Luther King, Jr., Ctr. for Soc. Change, Inc. v. American Heritage Products, Inc., 250 Ga. 135, 143 (1982). "[T]he right of publicity survives the death of its owner and is inheritable and “In determining whether a mark or trade name is likely to cause dilution by blurring, the court may consider all relevant factors, including the following: (i) The degree of similarity between the mark or trade name and the famous mark. (ii) The degree of inherent or acquired distinctiveness of the famous mark. (iii) The extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark. (iv) The degree of recognition of the famous mark. (v) Whether the user of the mark or trade name intended to create an association with the famous mark. (vi) Any actual association between the mark or trade name and the famous mark.” 15 U.S.C. § 1125(c)(2)(B).

(David Lilenfeld: here is the normal discussion of injunctive relief in a trademark infringement case): In addition to injunctive relief, the Plaintiffs also request damages identical to those requested pursuant to their section 1125(a) claim. The Court addressed these  damages in the section 1125(a) analysis.

"[T]he measure of damages to a public figure for violation of his or her right of publicity is the value of the appropriation to the user." Id. at 143. Here, the Plaintiffs have established each element against Foster. He appropriated the alias “Jack the Rapper,” which is known to be associated with Jack Gibson. (Pls.’ Statement of Facts ¶¶ 9, 13-14, 20, 23-27.) He did not have permission from any party possessing the right to Jack Gibson’s publicity. (Id. ¶¶ 29, 30-31.) He used the alias to promote the Conventions for financial gain. (Id. ¶ 32.) Consequently, Foster is liable to the Plaintiffs for the amount he gained through his appropriation of the “Jack the Rapper” alias.

IV. Conclusion

For these reasons, the Court GRANTS in part and DENIES in part the Plaintiffs’ Motion for Summary Judgment in this trademark infringement case against the Defendant Billy Darren Foster [Doc. 38]. The Court ORDERS that the Defendant Billy Darren Foster: (1) discontinue further use and attempts to cause further use of the “Jack the Rapper” mark in connection with conventions catering to the radio and music industries, as well as associated services and merchandise; and (2) withdraw the application filed with the United States Patent and Trademark Office to register the mark “The New Jack the Rapper Convention,” U.S. Trademark Application Serial No. 85,787,701 (filed Nov. 27, 2012).

SO ORDERED, this 2 day of December, 2013.

/s/Thomas W. Thrash

THOMAS W. THRASH, JR.

United States District Judge

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Case 1:13-cv-00405-TWT Document 42 Filed 12/02/13 Page 18 of 18

 


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