International Trademark Cases
ten landmark trademark cases. International compilations....
Case 1: Dastar Dastar
Cor p. v. Twenti Twenti eth Centur Centur y F ox F il m Corp. Corp.
In 1948, Fox Film corp. bought the rights to a book titled, “ Crusades in Europe”, by Dwight D. Eisenhower and released a 26 episode long series based on the same and bearing the same name. In 1977 the show show entered public domain.
In 1995, Dastar purchased the Betacam videotapes of the original series by Fox and vut it short to half of its original length and changed the packaging and sold the TV series as World War II campaigns in Europe and mentioned their employees as producers and no mention was was made to the original series by Fox.
Issues: Whether the series released by the defendant amounted a mounted to “passing off” Outcome:
The Court of appeals and the trial court gave decisions in favour of Fox awarding full profits and double the profits, respectively, earned by Dastar.
The Supreme Court reasoned that although the Lanham Act forbids a reverse passing off, this rule regarding the misuse of trademarks trademarks is trumped by the fact that once a copyrighted work (or, for that matter, a patented a patented invention) passes into the public the public domain, domain, anyone in the public may do anything they want with the work, with or without attribution to the author.
Relevance: It strengthens the rights of those who intend to make use of those works which have passed into public domains.
539 U.S. 23 (2003)
Wal M art Stores I nc. v. Samara Br others I nc.
Samara Brothers, Inc. designs and manufactures a line of children's clothing. WalMart Stores, Inc., contracted with a supplier, Judy-Philippine, Inc. (JPI), to manufacture outfits based on photographs of Samara garments and to be offered under Wal-Mart's house label, "Small Steps."
When JPI manufactured the clothes, it copied sixteen of Samara's garments with some small modifications to produce the line of clothes required under its contract with Wal-Mart.
After discovering that Wal-Mart and other retailers were selling the so-called knockoffs, Samara brought an action for infringement of unregistered trade dress under section 43(a) of the Trademark Act of 1946
Whether the plaintiff‟s product is distinctive and protectable from “knock -offs” under section 43(a) of trademarks act,1946
The Supreme Court reversed the judgement of the lower courts in this regard and said that an unregistered product configuration can never be inherently distinctive.
Further, the product in question needs to demonstrate that the product has acquired distinctiveness to be protected under trademark law.
"Consumers should not be deprived of the benefits of competition with regard to the utilitarian and aesthetic purposes that product design ordinarily serves by a rule of law that facilitates plausible threats of suit against new entrants based upon alleged inherent distinctiveness," Justice Scalia concluded.
Relevance: It dealt with the issue of unregistered product designs of products used for utilitarian purposes
529 U.S. 205 (2000)
Tr aff ix D evices I nc. v. M arketing Di splays I nc.
Marketing Displays, Inc. (MDI) held utility patents for a "dual-spring design" mechanism that keeps temporary road and other outdoor signs upright in wind. After the patents expired, Traffix Devices Inc. began marketing sign stands with a dualspring mechanism copied from MDI's design.
MDI brought suit under the Trademark Act of 1964 for, among other things, trade dress infringement. MDA claimed that its sign stands were recognizable to buyers and users because the patented design was visible.
Whether Marketing Displays Inc.'s trade dress infringement claim precluded because its dual-spring design is a functional feature for which there is no trade dress protection
The Court unanimously held that MDI‟s claim was not valid as there was no trade dress protection for its design
A utility patent is strong evidence that the features therein claimed are functional, "wrote Justice Kennedy. Focusing on the dual-spring design, Justice Kennedy continued that "where the expired patent claimed the features in question, one who seeks to establish trade dress protection must carry the heavy burden of showing that the feature is not functional, for instance by showing that it is merely an ornamental, incidental, or arbitrary aspect of the device." "MDI did not, and cannot, carry the burden," concluded the Court.
Relevance: There can be no trademark protection for something that is functional.
532 U.S. 23 (2001)
Kell ogg Co.v National B iscui t Co.
Inventor Henry Perky developed a shredded wheat machine and introduced the cereal in 1893; he was issued utility patents in 1895 on both the shredded wheat and on the machine.
The cereal became successful, and Perky's company, the Shredded Wheat Company, continued to manufacture the product after he retired.
The Kellogg Company started manufacturing shredded wheat cereal in 1912 after Perky's patents expired
After the Shredded Wheat Company objected, Kellogg stopped manufacturing their version in 1919. The nature of the settlement is not clear . In 1927, the Kellogg Company resumed manufacturing shredded wheat, prompting a lawsuit from the Shredded Wheat Company; the lawsuit was settled. In 1930, the Shredded Wheat Company was acquired by the National Biscuit Company (later Nabisco), which again sued Kellogg, both in Canada and in the United States, for unfair competition.
Whether the shape of the shredded wheat qualified to be protected under trademark law
Whether the defendant was liable for unfair competition
The court rejected Nabisco‟s arguments and allowed the defendant to continue manufacturing the “shredded wheat”.
The court held that the shape was functional and that there was a right to copy it after the patent expired
Further, the name Kellogg was so prominent on the cartons of the defendant that the question of “passing-off” of goods did not arise
Lastly, the court held that the term “shredded wheat” was generic and not trademarkable.
305 U.S. 111 (1938)
The present case became a foundation for the “FunctionalityDoctrine”, that says that product designs that are intrinsic to functionality cannot be protected under unfair practice or trademark laws.
At the time of this case, the trademark laws were in a state of confusion and the U.S. Justice Department decided to codify the decision in the present case into law, as part of the Lanham Act.
Park N Fl y Inc. v Dollar Park N F ly Inc.
In August 1971 the Petitioner, an operator of long-term parking lots, registered a trademark consisting of the logo of an airplane and the words “Park „N Fly.” Roughly six years later, Petitioner was granted incontestable status of its trademark.
Respondent, another long-term airport parking lot service, called its business “Park and Fly.”
Whether the defendant was liable under Trademark Law or it was generic and merely descriptive
The supreme court reversed the decision of the Court of Appeals which had held that the incontestable status can provide a defense against invalidation of a mark but could not be used to enjoin another party‟s use. Therefore, Respondent could defend its infringing use by attempting to show that the mark was merely descriptive.
The Supreme Court held that the infringement of an incontestable mark cannot be made on the grounds that its merely descriptive and awarded an injunction on the use of the mark by the respondent.
Relevance: It upheld that even if a trademark was descriptive, if granted incontestable status, it cannot be infringed upon on any grounds.
469 U.S. 189 (1985)
Two Pesos, I nc. v Taco Cabana, I nc.
Two Pesos was started in 1985 by Houston restaurateur Marno McDermot, who had been in negotiations with Taco Cabana's management to take the patio-restaurant chain nationwide.
When Taco Cabana's founding Stehling brothers rejected his advances, McDermot decided to open up his own chain of similarly themed patio-dining Tex-Mex restaurants under the Two Pesos name.
It was similar to Taco Cabana, however, Two Pesos never opened in Taco Cabana's home market of San Antonio.
Whether the Defendant is liable for infringement of the plaintiff‟s trade dress
Outcome: The Supreme court ruled in favour of the plaintiff and held that the defendant was liable for infringement of trade dress of the plaintiff.
505 U.S. 763 (1992)
Qual itex Co. v Jacobson Pr oducts Co.
Plaintiff Qualitex Co. had used a green-gold color for the pads which it sold to dry cleaning firms to use in their dry cleaning presses.
Defendant Jacobson Products Co. was a rival of Qualitex. In 1989, Jacobson began selling their own pads to dry cleaners which were a similar color to those of Qualitex.
In response, Qualitex filed a lawsuitagainst Jacobson in the United States District Court for the Central District of California for unfair competition.
In 1991, Qualitex registered the green-gold color of its pads with the United States Patent and Trademark Office as a trademark, and subsequently added a trademark infringement count to its lawsuit.
The District Court found for Qualitex, but the United States Court of Appeals for the Ninth Circuit set aside the judgment, on the grounds that color alone could not be registered as a trademark.
Whether a trademark can be granted based on colour of the product in question
Justice Breyer, writing for a unanimous court, overturned the Ninth Circuit‟s decision, holding that the Lanham Act was very broad in its definition of what a trademark could be.
Breyer also determined that the functionality doctrine was no bar to the registration of the plaintiff‟s color as a trademark. He determined that a product feature is only functional “if it is essential to the purpose of the article or if it affects the cost or quality of the article”.
Relevance: The color in this case acted purel y as a symbol, and served no other purpose. Jacobson argued that there are only a limited number of colors that could be used for the products at issue here, and that many colors are very similar looking, but Breyer dismissed this concern, saying 7
514 U.S. 159 (1995)
that if the defendant‟s concerns were proven to be valid, the functionality doctrine would then come into play. Breyer further held that a color could be trademarked separately from any trade dress protection.
M osel ey v V Secret Catalogue, I nc.
Victoria's Secret, a registered trademark owned by V Secret Catalogue, Inc., was found in 1988 to market moderately priced high quality lingerie in stores designed to look like a woman's bedroom. By 1998 the company operated 750 Victoria's Secret stores, including two in Louisville, Kentucky, and distributed 400 million copies of its catalogue.
In 1998 a weekly publication distributed to residents at Fort Knox, Kentucky, contained an ad for the grand opening of a store called Victor's Secret that was owned by Victor and Cathy Moseley which sold lingerie and adult novelties and gifts.
An army colonel who saw the ad was offended by what he perceived to be an attempt to use a reputable company's trademark to sell "unwholesome, tawdry merchandise" and contacted Victoria's Secret, which then requested the Moseleys to immediately discontinue the use of the name Victor's Secret and "any variations thereof."
In response the Moseleys changed the name of the store to Victor's Little Secret. Unsatisfied with this name change, Victoria's Secret filed suit in the District Court for the Western District of Kentucky alleging, among other claims, a violation of the FTDA (Federal Trademark Dilution Act).
Issues: Whether the defendant‟s commercial use of a mark or trade name "causes dilution of the distinctive quality" of the famous mark under the FTDA. Outcome:
The Court held that the FTDA requires proof of actual dilution. However, this proof did not necessarily include actual loss of sales or profit, as the Fourth Circuit had held. Instead, the owner of the trademark could use surveys or other circumstantial evidence of dilution. As Victoria's Secret did not provide evidence of actual dilution, the judgment of the circuit court was reversed.
Justice Kennedy filed a concurring opinion which noted that Victoria's Secret was not foreclosed from obtaining injunctive relief on remand of the case.
537 U.S. 418 (2003)
Relevance: Following the remand of the case to district court, Congress in 2006 passed the FTDRA, which essentially overturned the Supreme Court's Moseley decision. The district court applied the new law and granted summary judgment in favor of Victoria's Secret and issued an injunction against the use of the name Victor's Little Secret.
KP Perm anent M akeup I nc. v Lastin g Impr ession I I nc.
Cosmetics Company Lasting Impression trademarked the term "micro colors." Lasting Impression sued K.P. Permanent Make-Up in federal district court for using the term.
K.P. used the "classic fair use defense" and argued it used the term only to describe K.P. products. The district court sided with K.P. Lasting appealed to the Ninth Circuit Court of Appeals.
Unlike other federal appellate courts, the Ninth Circuit required companies that used the fair use defense to prove there was no likelihood of confusion in use of the term. The Ninth Circuit ruled there was likelihood of confusion and reversed the district court's ruling.
Whether a fair use defense to trademark infringement require the party asserting the defense to demonstrate an absence or likelihood of confusion
The Court held that a party raising the classic defense of fair use did not need to negate any likelihood that the practice under question would confuse consumers about the origin of the goods.
The Court interpreted federal trademark law as placing the burden of showing likelihood of confusion on the party charging infringement. Moreover, Congress "said nothing about likelihood of confusion in setting out the elements of the fair use defense."
Relevance: The burden of proof to prove absence or likelihood of confusion lies with the party charging with infringement.
543 U.S. 111 (2004)
Case 10: Facts:
Levitron is a brand of levitating toys and gifts in science and educational markets marketed by Creative Gifts Inc. and Fascination Toys & Gifts .
The Levitron top device is a commercial toy that displays the phenomenon known as spin-stabilized magnetic levitation. This method, with moving permanent magnets, is quite distinct from other versions which use changing electromagnetic fields, levitating various items such as a rotating world globe, model space shuttle or VW Beetle, and picture frame.
In the 1990s, Michael and Karen Sherlock formed the company they named "UFO" in New Mexico to market the Levitron under an oral agreement in partnership with Hones' company, Creative Gifts, Inc.
Efforts to formalize the agreement in writing fell apart and grew acrimonious after UFO's principals learned about the device's earlier invention by Harrigan, and redesigned their website to incorporate the exposé-style article "THE HIDDEN HISTORY OF THE LEVITRON!", which accused Hones of stealing the invention from Harrigan.
Whether the Defendant is liable for trademark infringement of the Levitron
Outcome: At trial and on appeal to the Tenth Circuit Creative Gifts' trademark claims were upheld, and all of UFO's counterclaims were rejected after UFO, which had been representing itself as a pro se defendant, was sanctioned by the court for abuse of discovery. The appeals court, noting that UFO had submitted a one-page opening brief with no citations to the record or discussion of the relevant law, commented in its ruling, "they have shot themselves in the foot."