Wake up and Smell the Coffee — Competing Rights in selling “Compatible” Products

On April 18, 2019, Nespresso USA, Inc.. sued Jones Brothers Coffee Company in the United States District Court for the Southern District of New York [Case 1:19-cv-03449], alleging that Jones Brothers is infringing its trademarks and  trade dress in selling coffee capsules compatible with Nespresso’s coffee machines.

More specifically, Nespresso alleges that Jones Brothers’ use of the phrase “Nespresso compatible” on its packing and in is advertising “falsely suggest and/or imply endorsement and/or sponsorship by and/or affiliation with, Nespressso.” [Complaint, Para. 15].  However if in fact Jones Brothers’ capsules are compatible with Nespresso, that seems like a fact that consumers would want to know, and Jones Brothers should be entitled to tell them.  Not surprisingly, there is nothing in the Complaint to suggest how Jones Brothers could otherwise convey this information to consumers,. and it will be interesting to see how the line is drawn between Jones Brothers right to provide information about the use of its products, and Nespresso’s right to be protected from competitors confusing its customers.

“Nespresso compatible” — consumer information or trademark infringement?

Nespresso also complains about the shape of Jones Brothers’ capsules, which it describes as “nearly identical replicas of the Nespresso Trade Dress in size, shape colors and appearance” sown to the “‘dimpled’ cone shape that is identical to the iconic feature of Nespresso’s capsule.” [Complaint, 16].  This picture makes Nespresso’s point 

However, this shape is similar to the shape of the capsule that Nestle/Nespresso patented in 1979:

It seems that Jones Brothers would have a right to copy technology from an expired patent, but if Jones Brothers’ capsule is really causing actual confusion, should there be a remedy for Nespresso, or should the deal they struck getting the patent be strictly enforced?

This is just the latest instance of balancing intellectual property rights with competition.  Intellectual property should never impeded competition, only unfair combination.  Where Jones Brothers’ conduct falls is now up to the Southern District of New York to decide.

Wipe that Smile Off Your Face, Cookie

On February 6, 2019, Eat’n Park Hospitality Group, Inc. sued Eleni’s NYC, Inc., in the Western District of Pennsylvania for infringing Eat’n Park’s registered smiley face trademark [Civil Action No. 2:19-cv-00131-MJH].



Eleni had previously licensed the smiley face from Eat’n Park, and the cookies on its website carry the registered design:

According to the Wikipedia and the Smithsonian Institution, the smiley face was created in 1963 by graphic artist Harvey Ross Ball, as a morale booster for the employees of State Mutual Life Assurance Company of Worcester, Massachusetts. The smiley, with a bright yellow background, dark oval eyes, full smile, and creases at the sides of the mouth, was imprinted on more than fifty million buttons and became familiar around the world.

While Eleni’s cookies appear to bear the registered mark, the question is whether consumers are likely to be confused. Eat’n Park has a federal trademark registration — several in fact — but they still have to prove a likelihood of confusion. Even though Eleni’s cookies use that design the answer may not be so clear, Given the ubiquity of the smilely as a decoration, and the fact that many cookies are decorated, would consumers perceive the smiley as trademark identifying the source or will they simply think it is a pretty cookie?

Given the popularity of the smiley, one would expect that Eat’n Park’s mark is very valuable, but like all trademark owners Eat’n Park needs to make sure that its mark is perceived as a mark and not merely a decoration. For this reason it is good idea for trademark owners to advertise their trademarks in addition to advertising their trademarked products.

Trademark Color Test: What Do You See?

Five years ago the internet obsessed over whether a particular dress was blue and black or white and gold.

Today’s color test is for trademark aficionado’s, who are probably already familiar Tiffany’s self-described robin’s-egg blue used on its packaging and catalog covers and registered in the USPTO:

The question for trademark experts is: What color is 7cs Fashion House’s JC logo:

infringing or non-infringing?

While 7Cs Fashion House calls the color teal, Tiffany sees red, believing it to be an infringing shade of their robin’s-egg blue color, and on February 6, 2019, filed Opposition 91246260 to block its registration.

TTAB Scores a 0 in Evaluating Genericness and Acquired Distinctiveness

In Royal Crown Company, Inc. v. The Coca-Cola Company, [2016-2375] (June 20, 2018), the Federal Circuit vacated the TTAB’s  dismissal of Royal Crown’s opposition to Coca-Cola’s registration of various ZERO marks for soft drinks and sports drinks including the term ZERO.

Noting that Royal Crown did not offer direct consumer evidence (surveys or testimony), nor did it offer dictionary evidence linking ZERO to soft drinks, offering only indirect evidence of competitor use of ZERO, the Board concluded that Royal Crown had failed to demonstrate that ZERO is generic for the genus of goods.  On the issue of descriptiveness, the Board found the evidence, including a five year old survey, indicated that ZERO had acquired distinctiveness.

On appeal, the Federal Circuit concluded that the Board erred in its legal framing of
the genericness inquiry in two ways—it failed to examine whether ZERO identified a key aspect of the genus at issue, and it failed to examine how the relevant public  understood the brand name at issue when used with the descriptive term ZERO.  The Federal Circuit further found that that the Board should have first assessed the level of the marks’ descriptiveness before determining whether Coca-Cola had shown acquired distinctiveness, because absent such a finding, it would not be possible to review whether the evidentiary record can support a finding of acquired distinctiveness.

On genericness the Federal Circuit said the critical issue was whether members of the relevant public primarily use or understand the term sought to be protected to refer to the genus of goods or services in question.  The Federal Circuit said that evidence of the public’s understanding of the term may be obtained from any competent source, such as purchaser testimony, consumer surveys, listings in dictionaries, trade journals, newspapers and other publications.  The Federal Circuit found the Board’s approach erroneous, asking the wrong question in assessing the alleged genericness
of ZERO. The Federal Circuit said the Board’s approach failed to consider that a term can be generic for a genus of goods or services if the relevant public understands the term to refer to a key aspect of that genus.  The test is not just whether the relevant public would use the term to describe the genus, but also whether the relevant public would understand the term to be generic.  A term is generic if the relevant public understands the term to refer to part of the claimed genus of goods or services, even
if the public does not understand the term to refer to the broad genus as a whole.

The Federal Circuit found that the Board failed to consider whether the relevant
consuming public would consider the term ZERO to be generic for a subcategory of the claimed genus of beverages i.e., the subcategory of the claimed beverages  encompassing the specialty beverage categories of drinks with few or no calories or few or no carbohydrates. The Federal Circuit remanded so that the Board could examine whether the term ZERO, when appended to a beverage mark, refers to a key aspect of the genus. The Court said ZERO need not be equated by the general public with the entire broad genus in order for the term to be generic.

On acquired distinctiveness, the Federal Circuit said that Board erred by failing to first determine exactly what Coca-Cola’s burden was.  An applicant’s burden of showing acquired distinctiveness increases with the level of descriptiveness: a more descriptive term requires more evidence of secondary meaning.  However the Board did not make any finding as to the degree of descriptiveness conveyed by the term ZERO in the marks and, thus did not assess Coca-Cola’s evidence through an exacting lens.

Ice Cream Brain Freeze

On May 9, 2018, Josh Berger brought a class action suit against Eden Creamery, complaining that the packaging of its  Halo Top ice cream is misleading because the product is actually light ice cream.

The Complaint, with reasoning surpassed only by Sir Vladimir’s detection of witches

 is that Halo-Top means creamy: 

Rather than parse the trademark for clues about the product (after all trademarks are not supposed to be descriptive), Mr. Berger could have saved himself, Eden Creamery, and the Federal Courts a lot of time and effort, by simply referencing the giant “280 Calories Per Pint” logo, which might have told him all he needed to know about the product.

 

 

 

 

 

 

 

 

Unbelievably, his Complaint argues that the name Halo-Top its is misleading, because:

 

 

 

Trademark Law Offers Scant Protection When Bad Things “Happen” to Good Marks

The was a lot of discussion recently about the episode of  NBC’s This is Us, which implicated a faulty switch on a Crockpot® in the death of the family’s beloved patriarch, Jack Pearson.  The manufacturers opened a Twitter account to respond to angry fans, and it issued a lengthy statement defending its product and asking NBC for some help to correct the record.

This is probably as good as the manufacturer could do.  This unfavorable depiction is not trademark infringement or even dilution.  The use, while unfortunate from the trademark owner’s standpoint, is protected by the story tellers first amendment rights.  While a disclaimer would be a nice gesture, it is not a legal  requirement.

Other trademark owners facing abuse or misuse of their products have similarly found that there is not much legally that the brand owner can do.  Several years ago, the Emerson Electric, the manufacturer of Insinkerator waste disposers was upset when the heroine of the TV series Heroes (also by NBC) deliberately put her hand in their waste disposal to demonstrate her recuperative power.  Emerson sued to mixed public reaction, and while it did get a concession by NBC to edit the depiction going forward, it eventually dismissed the case.

Many years ago Caterpillar, upset with the use of its bulldozers by the villains in the movie George of the Jungle II to destroy the jungle, sued Disney.  However, the suit did not get far.  See, Caterpillar Inc. v. Walt Disney Co., 287 F. Supp. 2d 913 (C.D. Ill. 2003).  Around that same time, Wham-O, maker of the iconic Slip ‘n’ Slide, sued Paramount Pictures for the misuse of the toy by the title character in the film “Dickie Roberts: Former Child Star,” and didn’t get very far.  See, Wham-O, Inc. v. Paramount Pictures Corp., 2003 WL 2300526 (N.D. Cal. 9/29/03).

Trademark protection offers scant protection when bad things happen to good brands.  Trademark owners are best off fighting bad percent at the court of public opinion, rather than a court of law.

 

 

 

Immoral and Scandalous Matter are as Registrable as Disparaging Matter; The Principal Register is FUCT

In In re Brunetti, [2015-1109] (December 15, 2017), the Federal Circuit reversed the Trademark Trial and Appeal Board, which affirmed the examining attorney’s refusal to register the mark FUCT because it comprises immoral or scandalous matter under
15 U.S.C. § 1052(a).

While the Federal Circuit found substantial evidence supported the Board’s findings and that the Board correctly concluded that the mark comprises immoral or scandalous matter, the Federal Circuit held that the bar on registering immoral or scandalous marks is an unconstitutional restriction of free speech.

After its en  banc decision In re Tam, 808 F.3d 1321, 1333–34 & n.4 (Fed. Cir. 2015), which held that Section 2(a)’s prohibition against registration of disparaging marks unconstitutional under the First Amendment because it discriminated on the basis of content, message, and viewpoint, which the Supreme Court affirmed, the Federal Circuit determined that the prohibition against scandalous marks was similarly unconstitutional.

The government conceded that § 2(a)’s bar on registering immoral or scandalous marks is a content-based restriction on speech, subject to strict scrutiny review. However, the
government contended § 2(a)’s content-based bar on registering immoral or scandalous marks does not implicate the First Amendment because trademark registration is either a government subsidy program or limited public forum.  The Federal Circuit examined both of these arguments in detail, and rejected them.

It seems ridiculous to assert that the First Amendment creates a right to register a trademark, but the Federal Circuit has held otherwise and the Supreme Court agrees.  One has to wonder which other of Section 2’s prohibitions are likewise improper restrictions on speech.

 

What’s the Flap Over the Unicorn Frappe?

On May 3, 2017, Montauk Juice Factory Inc. sued Starbucks Corporation in the Eastern District of New York, [1:17-cv-02678] alleging that Starbuck’s “UNICORN FRAPPUCCINO” infringed its “distinctive and famous” UNICORN LATTE.  Montauk also complained that Starbucks’ Unicorn Frappuccino shares visual similarities to the Unicorn Latte in that both were brightly colored and featured the colors pink and blue prominently.

Montauk claims that it began selling the UNICORN LATTE in December 2016 (although their trademark application claims a first use of October 1, 2016.  Peculiarly, Montauk acknowledges that the Unicorn Latte fits with the current trend of colorful foods—a relatively recent interest, particularly on the Internet, with multi-colored foods, and even specifically identifies UNICORN NOODLES and UNICORN POOP.

So is UNICORN a trademark, or is it simply a trend?  Recipes for UNICORN LATTES and UNICORN FRAPPUCCINOS abound on the internet.  There is UNICORN hot chocolate, UNICORN tea, UNICORN shakes, and UNICORN smoothies, UNICORN toast, UNICORN doughnuts.  While there is plenty of press about Montauk’s UNICORN LATTE, there are plenty of indications that UNICORN is descriptive if not generic, and that UNICORN food and drink are a trend.  Montauk may not even the originator of the trend — Toronto’s CutiePie Cupcakes & Co. has been selling a UNICORN LATTE since last summer.

Can Montauk show that it is likely that consumers will believe there is a connection between UNICORN LATTE and UNICORN FRAPPUCCINO, or is the only connection between the products in the minds of consumers that both are brightly colored, like other UNICORN food and drink?  If in fact Montauk is the owner of UNICORN LATTE, it may be the victim of genericization — a common fate for product innovators whose choice of brand name for a new product becomes the name for the product.  When naming a new product, it behooves the innovator to select both a generic name and a brand name, so that brand is not lost.

Non-Trademark Use is a Non-Infringing Use

In Oaklawn Jockety Club, Inc. v. Kentucky_Downs, LLC, [16-5582] (Sixth Circuit April 19, 2017), the Sixth Circuit affirmed a district court dismissal of plaintiff’s trademark infringement action because defendant’s use of plaintiffs’ trademarks in its electronic horse racing games was not likely to cause confusion.  Although the case was designated “NOT RECOMMENDED FOR PUBLICATION,” it makes an important point about trademark infringement: defendant must use plaintiff’s trademark as a trademark.

The district court found, and the Sixth Circuit agreed, that defendant’s marks in its animated video recreations of actual historic horse races, in order to identify the location of the race, was not a trademark use.

The Sixth Circuit noted that the term “Location” preceding the trademarks sufficiently explains to consumers that the trademarks are being used in a wholly descriptive
manner and does not cause a likelihood of confusion as to the source of the video.  The Sixth Circuit added that the fact that the replay is entirely generic and does not visually depict the plaintiffs’ facilities further supports this conclusion.

Because this was a non-trademark use of plaintiffs’ trademarks, the Sixth Circuit did not have to reach the question whether the fair-use defense applied.  As the Supreme Court said in Prestonettes, Inc. v. Coty, 264 U.S. 359, 368 (1924). “When the mark is used in a way that does not deceive the public we see no such sanctity in the word as to prevent its being used to tell the truth.”

Policing the Trademark Playground and Calling Out Bullies

The prevailing defendant in Louis Vuitton v, My Other Bag, LLC (blogged about here: Louis Vuitton Left Holding the Bag) in a Motion filed on April 7 in the Southern District of New York (Case 1:14-cv-03419-JMF Document 154) is seeking $802,939.05 in fees and costs for defending Louis Vuitton’s claim that MOB’s parody bag infringed or diluted Louis Vuitton’s rights:

MOB argues that a fee award is justified because Louis Vuitton is a trademark bully.  “Trademark bully” is a term that is being used with increasing frequency.  See Three Stripes and You’re Out.  MOB used the term “bully” at least 13 times in its motion for fees.

Trademark Owners are put in a difficult position.  The failure to aggressively enforce their rights, can allow third party uses that either weaken the mark in a likelihood of confusion analysis, or lessen its fame and distinctiveness in a dilution analysis.  A trademark owner may (rightly) feel forced to take actions that it might otherwise be inclined to tolerate.  And outside of the costs of enforcement, there has been little consequence to bringing such a claim.

An award of attorneys fees and costs in appropriate cases, may be exactly what is needed to tip the scales when enforcement decisions are being made.  It is up to the Southern District of New York to judge the propriety of Louis Vuitton’s enforcement efforts, and decide whether or not the name “bully” is appropriate.