Beloved burger chain In-N-Out Burger, home of not-so-secret menu items and “animal style” fries, has sued burger competitor Smashburger, claiming that Smashburger’s new “Triple Double” burger infringes on In-N-Out’s “Double-Double” and “Triple Triple” trademarks.
Burger aficionados and dabblers alike are probably well-aware of In-N-Out’s “Double-Double” burgers, which come with two meat patties and two slices of cheese. According to In-N-Out’s complaint, Smashburger recently began marketing a “Triple Double” burger, which contains two meat patties and three slices of cheese. In-N-Out alleges that it has had registered trademarks on the mark “Double-Double” since 1975, and “Triple Triple” since 1990 – and further, its customers frequently mix and match the terms to create customized orders, including a “Triple Double.” Smashburger apparently filed applications with the USPTO in November 2016 to trademark the term “Triple Double.”
In-N-Out claims that Smashburger’s use of the mark “Triple Double” has damaged In-N-Out because consumers are and will be confused and misled into believing that In-N-Out is somehow affiliated with Smashburger, and In-N-Out will suffer injuries to its reputation and goodwill. Both burger chains have locations in southern California, where In-N-Out’s lawsuit was filed.
If the case were to go to trial, prospective jurors should consider demanding a blind taste test to determine whether there is, in fact, a likelihood of confusion between In-N-Out’s Double-Double and Smashburger’s Triple Double.
The Copyright Symbol. Use of the copyright symbol Ⓒ is regulated by federal copyright law. For works first published after March 1, 1989, a formal copyright notice is optional. 17 U.S.C.A. § 401(a). There are several formats for this notice proscribed by federal statute. Federal law specifies that the notice may be in any one of the following forms: (1) the symbol Ⓒ (the letter C in a circle), (2) the word “Copyright” or (3) the abbreviation “Copr.” 17 U.S.C.A. § 401(b)(1).
While not required, including a copyright notice on a published work can negate an infringer’s ability to rely on the “innocent infringement” defense to avoid the imposition of certain damages. 17 U.S.C.A. §§ 401(d) and 402(d).
A copyright notice was required for works published before March 1, 1989 (the effective date, as to the United States, of the international copyright treaty known as the Berne Convention). General publication before that date without a copyright notice could cause a work to enter the public domain if the copyright owner failed to cure the omission of the mandatory copyright notice. There are, however, some limited circumstances in which the omission of the copyright notice from authorized copies distributed by the copyright owner does not invalidate the copyright in a work. For example, a copyright is not lost if an otherwise required copyright notice was left off in violation of an express written requirement contained in the owner’s authorization of the public distribution of the work. 17 U.S.C.A. § 405(a)(3).
The Trademark Symbol. Where a trademark is not registered, those claiming a protectable trademark or servicemark can make use of the “TM” and “SM” symbols. The former signals a claimed trademark, while the latter is used with servicemarks (a servicemark is a trademark used to identify a service rather than a product). No specific federal statutes authorize the use of the “TM” symbol, limits its use, or states definitively what it does or does not convey to the public. Southern Snow Manufacturing Co. v. Snow Wizard Holdings, Inc. (E.D. La. 2011) 829 F.Supp.2d 437, 452 (“Southern Snow”). Historically, however, the designation has been used as a way of alerting the public to a claim of ownership of a trademark. Southern Snow, at p. 452. Such a claim does not necessarily equate with any actual, protectable rights. “…[T]he TM symbol does not mean that the party has trademark rights in the name or can ensure that the mark is capable of serving as a trademark…” Southern Snow, at p. 453-454.
However, using the “TM” and “SM” symbols can help establish a trademark. The courts may consider such use as evidence demonstrating that a name or mark is being used in the sense of a trademark or servicemark to reflect the origin of the goods or services, a factor in the overall determination of the existence of trademark protection. The fact that no symbol is used to designate an alleged trademark is evidence that the mark is not being used as a trademark. T.A.D. Avanti, Inc. v. Phone-Mate, Inc. (C.D. Cal. 1978) 1978 WL 21444, *6.
Hard Candy, LLC (“Hard Candy”) sued The Procter & Gamble Company (“P&G”), parent company to CoverGirl in the federal district court of Florida for 1) federal trademark infringement, 2) federal unfair competition, 3) common law trademark infringement, and 4) common law unfair competition over the alleged infringing design of Katy Perry’s makeup line with CoverGirl. Hard Candy alleges that P&G copied Hard Candy’s registered design marks in a confusingly similar manner.
Although Hard Candy did not specifically state what aspect of the Katy Perry CoverGirl makeup line infringes upon its design marks, it appears that Hard Candy is claiming that the logos/marks (capitalized words in black before and after a black heart shape) are similar in their overall design. See examples below.
Hard Candy cited the following three (3) registered design marks in support of its complaint against P&G:
In support of its argument that the Katy Perry CoverGirl makeup line is likely to cause confusion among consumers, Hard Candy alleges that they sell the same or similar products (cosmetics) and offer these products in the same channel of trade at similar price points to similar target customers. Hard Candy may also argue that the black heart shape design is the dominant feature of the marks and similar (if not identical) in both marks.
While these factors are strong ammunition against Katy Perry/CoverGirl, it may be difficult for Hard Candy to argue that the overall commercial impressions are similar. For instance, the font and words before and after the black heart shape design look and sound different. As a self-proclaimed make-up lover, I personally would not be confused by the design marks, especially if the CoverGirl logo is used in connection with the Katy Perry name and the black heart shape design. Both Katy Perry and CoverGirl have established their own brand for years and also have successfully campaigned together to promote this makeup line, which further differentiates themselves from other makeup lines. Nonetheless, it will be interesting as to how each paints the other.
Just coming off the heels of the lawsuit it filed against Marc by Marc Jacobs on April 8, 2015, adidas America, Inc., adidas AG, and adidas International Marketing B.V. (collectively, “adidas”) filed suit against Skechers USA, Inc. (“Skechers”) on September 14, 2015 in the United States District Court of Oregon for trademark and trade dress infringement, unfair competition, trademark and trade dress dilution, deceptive trade practices, and breach of contract. The company alleges that the Skechers “Onix” tennis-style sneaker infringes on one of its most iconic shoes, “the ‘Stan Smith’ sneaker, which adidas introduced in the early 1970s featuring a classic tennis-shoe profile with a sleek white leather upper, three rows of perforations in the pattern of the well-known Three-Stripe trademark, a defined stitching across the sides of each shoe enclosing perforations, a raised mustache-shaped colored heel patch, which often is green, and a flat tonal white rubber outsole.”
In its complaint, adidas outlined all the similarities between the adidas Stan Smith and the Skechers Onix.
In support of its infringement claims, adidas cites its various federal registrations for its famous “Three Stripe Mark” on athletic shoes.
Although the perforations on the Skechers Onix do not exactly mimic the three rows of perforations in the pattern of the well-known Three-Stripe Mark, it is hard to deny the striking similarities between the two sneakers. adidas is seeking various damages, including all profits derived from the infringing good, costs and reasonable attorneys’ fees, as well as an injunction to stop all sales and marketing of the infringing good.
After two years of battle in court, Tory Burch LLC (“Tory Burch”) wins $41.2 million ($38.9 million in damages and $2.3 million in attorneys’ fees) in its trademark infringement lawsuit against Lin & J International, Inc. (“Lin & J”), which was filed on May 31, 2013, in the U.S. District Court of the Southern District of New York. Tory Burch alleged in its 2013 complaint that Lin & J’s unauthorized use of Tory Burch’s federally registered trademarks and copyrighted works violated trademark counterfeiting, trademark infringement, trademark dilution, copyright infringement, and unfair competition laws. In particular, Tory Burch claimed that Lin & J wrongfully reproduced earrings, necklaces, pendants, cuffs, bangles, and bracelets bearing unauthorized reproductions of Tory Burch’s famous TT Designs (see below).
Despite the apparent similarities, Lin & J had countersued Tory Burch for unfair trade practices, tortious interference with its business relationships, defamation, and trademark infringement. Lin & J claimed that its Isis Design is inspired by the Isis cross or a Coptic cross, which is a symmetrical cross with short, flanged bars, typically set in a circle. Nonetheless, in addition to finding that Lin & J had fabricated and destroyed evidence, the court ruled against Lin & J. This $41.2 million win for Tory Burch will be another notch added to her designer belt and not to mention her $3 billion (yes, with a “B” billion) empire.
Today’s topic is “tacking” and why you need to have at least some awareness of this important concept in the law of trademark.
Imagine Company A has been using a distinctive and well-known company logo on its product for years. Company A then decides to “refresh” its marketing, including rolling out a shiny, updated logo. Does Company A lose any trademark rights it may have established in the old company logo simply by updating its branding?
That is where “tacking” comes in. This concept allows a trademark owner to “tack on” the period of use of an earlier mark to the owner’s use of a subsequent mark where the “two marks are so similar that consumers generally would regard them as essentially the same.” Hana Financial, Inc. v. Hana Bank (9th Cir. 2013) 735 F.3d 1158, 1163-1164, cert. granted, 134 S. Ct. 2842 (2014) and aff’d, 135 S. Ct. 907 (2015); Hana Financial, Inc. v. Hana Bank (2015) 135 U.S. Ct. 907, 910 (two marks “may be tacked when the original and revised marks are ‘legal equivalents,’” meaning that the two marks that “‘create the same, continuing commercial impression’ so that consumers ‘consider both as the same mark.’”).
If an owner is allowed to tack on to prior use, updating a trademark (such as a tradename, a product slogan or logo style) does not result in abandonment of or loss of priority in the use of the trademark.
Tacking furthers the policy aims of trademark law because it prevents the loss of valuable trademark rights while still allowing for reasonable innovation in the market. As the Ninth Circuit of Appeals explained in its decision in Hana Financial, Inc. v. Hana Bank, a decision recently affirmed by the United States Supreme Court:
“Tacking” is permitted because “[w]ithout tacking, a trademark owner’s priority in his mark would be reduced each time he made the slightest alteration to the mark, which would discourage him from altering the mark in response to changing consumer preferences, evolving aesthetic developments, or new advertising and marketing styles.” … Moreover, “[g]iving the trademark owner the same rights in the new mark as he has in the old helps to protect source-identifying trademarks from appropriation by competitors and thus furthers the trademark law’s objective of reducing the costs that customers incur in shopping and making purchasing decisions.”
Hana Financial, Inc. v. Hana Bank, supra, 735 F.3d at 1164, quoting Brookfield Communications, Inc. v. West Coast Entertainment Corporation (9th Cir.1999) 174 F.3d 1036, 1048.
However, here is the real lesson for the day—the courts have made it abundantly clear that the doctrine of tacking is “exceptionally narrow” and, therefore, you must tread lightly when you endeavor to alter the look or feel of any existing trademarks, especially things like company logos or product slogans. Brookfield Communications, Inc. v. West Coast Entertainment Corporation, supra, 174 F.3d at 1036, 1047-1048. The standard for tacking has been described as “exceptionally narrow” and “exceedingly strict.” The marks “must create the same, continuing commercial impression” and the later mark should not “materially differ from or alter the character of the mark attempted to be tacked.” Id. at 1048. So when the marketing folks come up with all of those great ideas to jazz up the company branding, make sure to give thought to the impact on trademark rights and confer with trademark counsel if necessary.
On April 8, 2015, Adidas filed suit against Marc by Marc Jacobs (“Marc”) in the United States District Court of Oregon for trademark infringement, unfair competition, trademark dilution, and deceptive trade practices based on Marc’s use of a four stripe pattern on sweaters in its autumn/winter 2014 collection, which allegedly infringes on Adidas’ “Three-Stripe Mark.” See comparison below. In its complaint, Adidas claims that Marc’s “use of confusingly similar imitations of adidas’s Three-Stripe Mark is likely to deceive, confuse, and mislead purchasers and prospective purchasers into believing that the apparel sold by Marc Jacobs is manufactured by, authorized by, or in some manner associated with adidas, which it is not.”
Adidas claims that it has used the “Three-Stripe Mark” on apparel sold in the U.S. and worldwide since as early as 1967. Adidas further support its claims based on its numerous incontestable federal trademark registrations, which includes Reg. No. 2,058,619, issued on May May 6, 1997, for the “Three-Stripe Mark,” for “sports and leisure wear, namely shirts.”
An “incontestable” registration is conclusive evidence of the validity of the registered mark, of the registration of the mark, of the owner’s ownership of the mark and of the owner’s exclusive right to use the mark with the goods/services. If the owner of the mark can establish that the mark is incontestable, the mark will be presumed valid unless another party can establish one or more of the following:
The registration or the incontestable right to use the mark was obtained by fraud.
The registrant has abandoned the mark.
The mark is used to misrepresent the source of its goods or services.
The infringing mark is an individual’s name used in his or her own business, or is otherwise prohibited or reserved under the Lanham Act.
The infringing mark was used in commerce first—before the incontestable mark’s registration.
The infringing mark was registered first.
The mark is being used to violate the antitrust laws of the United States.
Although nothing is guaranteed in court, it appears that Marc will have an uphill battle defending itself against Adidas since, at first glance, it appears that even Sue Sylvester would wear either of the above track jacket or sweater.
IP owners are borrowing a big hammer from the real estate industry. In real estate litigation, there is one legal device that strikes fear into the heart of the adversary—the lis pendens. A lis pendens, or notice of pendency of action, is a legal remedy that the courts describe as a “a powerful weapon.” Essentially, a lis pendens allows a party to a lawsuit asserting a claim affecting real property to record a notice upon the property giving notice to the world that there is pending litigation that may affect the title to the property. A lis pendens can grind to a halt any contemplated transfer or financing involving the property. A lis pendens is not something oft seen in the world of intellectual property law. Nonetheless, grounds can arise for its use in conjunction with cases primarily about intellectual property. Counsel in IP cases may be able to utilize a lis pendens to good effect in certain circumstances against an infringer or wrongdoer even before an IP case is prosecuted through a final judgment.
A good example is Hunting World, Incorporated v. Superior Court. The alleged wrongdoer was sued in federal court for selling counterfeit purses, bags, fanny packs, and other goods bearing counterfeit Hunting World trademarks. Hunting World, Incorporated v. Superior Court (1994) 22 Cal.App.4th 67, 69. Shortly after the filing of the lawsuit, the wrongdoer quitclaimed his residence to his wife, which prompted a state court lawsuit by Hunting World to seek to set aside the conveyance. Hunting World also recorded a lis pendens against the property.
The defendant challenged the validity of the lis pendens, and the trial court ruled that the fraudulent transfer action did not affect title to real property because Hunting World was not seeking title to the property but only a way to reach the assets of the wrongdoer in the event of a money judgment in Home World’s federal IP case.
On appeal, the California Court of Appeal reversed the trial court’s decision and held that the lis pendens was valid. The Court of Appeal declined to “look through” the fraudulent transfer action in order to ascertain the purpose of the party seeking to maintain the lis pendens. Hunting World could still prove a fraudulent transfer claim, even though the underlying IP case primarily sought money damages on intellectual property claims, and did not affect title to real property.
The Hunting World case demonstrates that a party can bring to bear the potent remedy of a lis pendens, even when the crux of the matter is about intellectual property and not real property. A party bringing an infringement or other IP case against a wrongdoer should utilize the power of a fraudulent transfer action and a lis pendens where there is evidence that the wrongdoer has sought to shelter real property assets from possible collection in an IP lawsuit.
Guru Denim, Inc. dba True Religion Brand Jeans recently sued Burlington Coat Factory Warehouse Corporation for selling jeans that allegedly infringed on True Religion’s “U-shaped” pocket design. Interestingly, this is not the first time that True Religion filed suit against Burlington for infringement of its “U-shaped” marks. True Religion has used its “U-shaped” marks since as early as 2002 and has registered various “U-shaped” marks with the United States Patent and Trademark Office since 2006. Here are a few of True Religion’s trademark registrations for the “U-shaped” pocket design:
According to the lawsuit, Alpha Garment, Inc. supplies Burlington and various nationwide retailers with the infringing jeans. Exhibit A below is an example of the alleged infringing use of the “U-shaped” pocket design supplied by Alpha and sold to consumers by Burlington. True Religion claims that use of the pocket design as shown in Exhibit A is “substantially indistinguishable and/or confusingly similar” to its “U-shaped” marks. See Exhibit B below for an example of True Religion’s “U-shaped” pocket design.
What do you see? Arguably based on the side by side comparison, the pockets are somewhat similar. However, the pocket designs are not identical. The pocket design in Exhibit A appears to be a stylized intersecting “X-shape” rather than a rounded continuous “U-shape” as in Exhibit B. Nevertheless, whether Exhibit A is likely to cause consumer confusion as to the source or origin of goods is one of the primary questions that the parties will need to address. If Burlington loses, it may be ordered to pay monetary damages to True Religion and to cease selling the infringing jeans.
Whether you love, hate, or are indifferent to the Kardashian franchise, the Kardashian sisters undeniably know how to market and brand themselves and their products. In December 2012, the Kardashian sisters hoped to Kardazzle its consumers with their new makeup line, Khroma Beauty. Here is an example of their Khroma Beauty advertisement.
Unfortunately, unlike King Midas, the Kardashian sisters did not turn Khroma Beauty into gold. Aside from dealing with less than stellar reviews, the Kardashian sisters received a cease and desist letter in June 2012 from By Lee Tillett, Inc., owner of the federal registration for the mark KROMA. Lee Tillett is a celebrity makeup artist and founder of Kroma, a cosmetics company based in Altamonte, Florida. Ms. Tillett choose the trademark KROMA, which means color in Greek, based on her Greek heritage and has used the trademark since March 2004. Here is a photo of Ms. Tillett with her Kroma cosmetics line.
In response to Ms. Tillett’s cease and desist letter, Boldface Licensing + Branding, which is the Kardashian’s licensing company, filed an action in a California federal court in December 2012 seeking declaration of its rights. Refusing to back down, Ms. Tillett filed a counterclaim in January 2013 seeking $10 million for trademark infringement. After months of legal battles, which included a preliminary injunction issued against the Kardashians, and then losing their appeal on the court’s decision to issue the injunction, the Kardashian sisters finally changed the name of their makeup line to Kardashian Beauty in May 2013. Here is an example of the new advertisement for Kardashian Beauty.
However, despite the name change, Ms. Tillett refused to dismiss the lawsuit, let alone dismiss the Kardashian sisters as defendants. Although the white flag in the form of name change generally spells the end of a trademark infringement lawsuit, it appeared that Ms. Tillett was determined to seek retribution especially given that Kroma’s sales dropped since the Kardashian sisters launched Khroma Beauty in the winter of 2012. Nevertheless, in April 2014, the light at the end of the tunnel appeared for the Kardashian sisters when the parties finally reached an undisclosed settlement agreement.
Lesson Learned: This headache could have been avoided if a trademark search was conducted. In general, trademark attorneys will conduct a trademark search via the internet, the United States Patent and Trademark Office database, and other comprehensive databases such as Thomson CompuMark to determine the availability of the mark when their clients begin the early stages of branding. This trademark search most likely would have identified Ms. Tillett’s KROMA mark, and a risk benefit analysis would have likely determined that Kardashian Beauty is a better and safer choice than Khroma Beauty.
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