Hershey Wins TRO Against Furniture Company Based On Trade Dress Dilution

Hat Tip to Marty Schwimmer for posting the complaint filed by Hershey Company (“Hershey”) against Art Van Furniture (“Art Van”), a Michigan furniture company over its use of the above picture on its furniture trucks as well as the somewhat surprising decision by the court to grant a temporary restraining order on the basis of dilution. See Hershey Company et al v. Art Van Furniture, Inc., Case No. 08-cv-14463 (E.D. Mich. Filed October 21, 2008). Reports on the actions of the parties leading up to the lawsuit have been published by the AP and The Detroit New.

Most of the court’s decision is spent analyzing, and ultimately rejecting (ed.—rightly so), a likelihood of success on the merits for Hershey’s trademark/trade dress infringement claims given the balance of the likelihood of confusion factors favoring Art Van.

However, the court then, with a relatively brief analysis of Hershey’s trademark dilution claim, concludes that Hershey has established a likelihood of success on the merits for a claim of trademark dilution by blurring.
Granted, Hershey had the advantage in meeting the primary elements necessary to show dilution under 15 U.S.C. §1125(c) – specifically a famous and distinctive trademark in the nature of the Hershey’s candy bar trade dress, use of the Art Van ad by Art Van after Hershey’s trade dress became famous, and a similarity between the Art Van ad and Hershey’s trade dress that gives rise to an association between Hershey’s trade dress (Comment: Based on the pictures above, I’m not so sure I would agree with the court's finding that Art’s candy bar would give rise to an association with Hershey’s candy bar).

As for whether such association is likely to impair the distinctiveness of the famous mark, when you start to analyze the six factors set forth in 15 U.S.C. § 1125(c)(2)(B) that courts consider in deciding if a junior mark is likely to dilute a famous mark through blurring (degree of similarity, degree of inherent or acquired distinctiveness of the famous mark, exclusive use of famous mark, degree of recognition, intent to create an association with the famous mark, and any actual association), they tend to favor Hershey’s as well (comment--although again, I’m not sure I agree with the degree of similarity in this case).

But what I found curiously odd was the court’s short shrift of Art Van’s parody defense. Naturally, as support for its argument that its use was protected by parody, Art Van cited to the last year’s “Chewy Vuitton” decision in Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC, 507 F.3d 252, 260 (4th Cir. 2007), which rejected a dilution cause of action by Louis Vuitton against the makers of “Chewy Vuitton” dog toys.

The following is the sum total of the court’s distinguishing of the instant case and the Louis Vuitton decision (emphasis added):

The [Louis Vuitton] court dismissed the plaintiff’s infringement and dilution claims; there was no mistaking the intentional, yet irreverent nature of the defendant’s miniature handbags. Id. at 260-61.
“It is a matter of common sense that the strength of a famous mark allows consumers immediately to perceive the target of the parody, while simultaneously allowing them to recognize the changes to the mark that make the parody funny or biting.” Id. at 261. Defendant’s “couch bar” may be funny, but it is not biting; its resemblance to Plaintiff’s famous trade dress is too muted to poke fun, yet too transparent to evoke a generic candy bar.
An important theme running through Louis Vuitton is that, while a parody may be nearly identical to the original in some respects, in others it is so different that no one could possibly mistake it for the real thing. Id. Defendant’s design is neither similar nor different enough to convey a satirical message.

So there is no mistaking that a dog toy that sells under the name “Chewy Vuitton” and made to look like (and yet obviously not be) a mini “Louis Vuitton” purse is so intentionally irreverent that it constitutes a parody – yet a sign on a furniture truck showing a brown couch emerging from a candy bar wrapper that looks somewhat like a Hershey candy bar wrapper is not irreverent? Surprisingly, the key appears to be "somewhat like a Hershey candy bar."

Basically, the court is saying that Art Van’s ad, while capturing an image that consumers would associate with Hershey’s trade dress, is not so strong enough that Art Van can claim it to be a parody of Hershey’s trade dress. The court uses the word “biting” although I’m not so sure I would call a “Chewy Vuitton” dog toy a “biting” parody (although I’m sure there are numerous dogs out there that find such toys quite “biting”).

While I’m not so sure I agree with the court’s decision that Art Van’s ad is not “biting” enough (i.e., neither similar nor different enough to convey a satirical message), the lesson learned is that if you are going to parody a famous mark, you had better make sure that you go all out to not only make an obvious association with the famous mark, but also to make an obvious disassociation with the famous mark.

Apparently, if you attempt to parody a Hershey bar, but it’s not clear enough that you are parodying an actual Hershey bar, then such ad, while apparently sufficient for dilution purposes with respect to such Hershey bar, is insufficient for parody purposes.

One wonders if the court would have decided the parody issue differently had the lettering more closely resembled the Hershey candy bar lettering (or even used a word like “Couchey’s” inpace of “Hershey's” and then “Fine Furniture” instead of “Milk Chocolate”) and had the color of the candy bar looked more like the famous dark brown color of a Hershey bar? What is the point where Art Van’s ad would have been intentionally irreverent enough to constitute a parody?

Motorola Files Counterfeit Lawsuit, Obtains Temporary Restraining and Seizure Order Against Two Las Vegas Trade Show Exhibitors

On April 1, 2008, Motorola, Inc. (“Motorola”) filed a trademark infringement lawsuit against Mocoola Accessories Wholesale, Inc. and Big Apples Accessories, Inc. (together , the Defendants) in the U.S. District Court for the District of Nevada. See Motorola, Inc. v. Mocoola Accessories Wholesale, Inc. et al, Case No. 08-cv-00414 (D. Nev. April 1, 2008). A copy of the complaint can be downloaded here.

Motorola owns the registered marks MOTOROLA, MOTOROLA (and Stylized M Design), and Stylized M Design (pictured above) along with many others. The Defendants are both exhibitors at the CTIA WIRELESS 2008 trade show (hosted by the Cellular Telecommunications and Internet Association) currently running in Las Vegas (today is the final day of the show).

According to the complaint, the Defendants, without license or authorization from Motorola, are selling at the CTIA show (and likely elsewhere) wholesale goods bearing the MOTOROLA registered marks that are the same type of goods sold by Motorola (i.e. counterfeit goods).

The causes of action are for registered trademark infringement and counterfeiting under §32 of the Lanham Act (15 U.S.C. §1114), false designation of origin and federal unfair competition under §43(a) of the Lanham Act (15 U.S.C. §1125(a)), and deceptive trade practices (passing off and false representation as to source) under Nevada law (N.R.S. §598.0903 et seq).

As part of the requested relief, Motorola filed an ex parte application for a temporary restraining order (“TRO”), a seizure order, and order to show cause for a preliminary injunction against the Defendants. A copy of Motorola’s ex parte application can be downloaded here.

Such relief is specifically provided for in §34(d) of the Lanham Act (15 U.S.C. §1116(d)) which authorizes a district court, in the case of a violation of §1114(1)(a) arising from the use of a counterfeit mark, to grant an order, upon ex parte application, providing for the seizure of goods bearing the counterfeit marks as well as records documenting the manufacture, sale, or receipt of things involved in the counterfeiting.

Motorola’s case for immediate irreparable harm and likelihood of success on the merits convinced District Judge Philip Pro to grant the TRO and seizure order on April 2, 2008 (download here) enjoining the Defendants from selling any counterfeit Motorola merchandise and allowing Motorola to go to the Defendants’ booth at the CTIA show and seize any counterfeit merchandise as well as the Defendants’ books and records.

Judge Pro, basically accepting Motorola’s proposed order attached to its ex parte application, found that Motorola was likely to succeed on the merits of its claims that the Defendants are intentionally selling goods using unauthorized reproductions or counterfeits of Motorola’s marks, that the Defendants’ sale of such counterfeit goods are likely to cause immediate and irreparable harm to Motorola’s reputation and goodwill which outweighs any monetary hardship to the Defendants resulting from the TRO and seizure order (subject to Motorola maintaining a $5,000 security bond), that the grant of the TRO and seizure order ex parte is the only adequate remedy to achieve the purposes of §1114, and that such relief is in the public interest (i.e. yjr public interest of avoiding consumer confusion and enforcing trademark rights).

A hearing on the order to show cause why a preliminary injunction should not be entered is scheduled for April 10th.

The case is similar to two lawsuit brought by Motorola in Nevada about a year ago during the 2007 Consumer Electronics Show held in Las Vegas in order to stop two exhibitors from selling counterfeit Motorola headsets. See Motorola, Inc. v. National Electronics, Inc., Case No. 07-cv-00016 (D. Nev. January 8, 2007) (still pending) and Motorola Inc. v. Telcom USA, Case No. 07-cv-00015 (D. Nev. January 8, 2007) (ending in default judgment).

Sensient Flavors obtains Temporary Restraining Order against SensoryFlavors

On March 10, 2008, Sensient Technologies Corporation along with one of its subsidiaries, Sensient Flavors LLC (together “Sensient”), filed a lawsuit in the U.S. District Court for the Eastern District of Missouri again SensoryFlavors, Inc., Performance Chemicals & Ingredients Co., Diehl Food Ingredients, Inc., and Highlander Partners, L.P. (collectively “SF”) alleging trademark infringement and unfair competition under the Lanham Act, common law, and Missouri law as well as trademark dilution under Missouri law. See Sensient Technologies Corporation et al v. SensoryFlavors, Inc. et al, Case No. 4:08CV00336 ERW (E.D. Mo. March 10, 2008). Along with the complaint, Sensient filed a Motion for a Preliminary Injunction which sought a temporary restraining order (“TRO”) against SF’s use of the SensoryFlavors name, logo, and website.

For more than 125 years, Sensient Technologies has been in the business of developing and distributing flavors, fragrances, and colors used in food, beverage, household care, and personal products. Previously known as Universal Foods Corporation, the company, in 2000, decided to rebrand itself by creating the mark “Sensient” and began to change its entire corporate identity around the mark. The company has received numerous registrations for the mark SENSIENT including, inter alia, “cosmetic fragrances and food emulsifiers” and “food and beverage colorants”

On February 13, 2008, Givaudan Flavours North America (“Givaudan”), a manufacturer and supplier of flavors for ice cream and other dairy products, changed its name to SensoryFlavors Inc. after being acquired by Performance Chemicals & Ingredients Co. (link to press release). Givaudan and Sensient Flavors were direct competitors in the area of ice cream and dairy flavors. In addition, the President of SensoryFlavors Inc. is Charles Nicolais, who served as the head of Sensient Colors, Inc., another subsidiary of Sensient Technologies and sister company of Sensient Flavors, from February 2004 through July 2005.

Sensient maintains that the name SensoryFlavors was chosen to cause confusion with its Sensient Flavors name. SF asserts that the name was an outgrowth of the SensoryEffects word mark and design registered in 2004 and that they wanted to build on the goodwill of such make by developing a similar name for the acquired flavor business (replacing the word “Effects” with the generic word “Flavors”).

The court analyzed the usual four factors for determining whether to issue a TRO: (1) the threat of irreparable harm to the moving party; (2) balancing the harm and injury to the non-moving party in granting the injunction; (3) the probability of the success on the merits; and (4) the public interest. See Phelps-Roper v. Nixon, 509 F.3d 480, 484 (8th Cir. 2007).

Probability of the success on the merits
The court first analyzed probability of the success on the merits. The court found, on balance, that Sensient was likely to prevail on its claims, specifically, for purposes of deciding the motion, Sensient’s federal trademark infringement claim.

The six factors analyzed by the court for determining whether SF’s use of its mark was likely to cause confusion as to the source or sponsorship of the goods or services are:

1) the strength of the plaintiff's mark; 2) the similarity between the plaintiff's mark and defendant's marks; 3) the degree to which the allegedly infringing product competes with the plaintiff's goods; 4) the alleged infringer's intent to confuse the public; 5) the degree of care reasonably expected of potential customers, and 6) evidence of actual confusion.

Davis v. Walt Disney Co., 430 F.3d 901, 903 (8th Cir. 2005).

Regarding the strength of the SENSIENT mark, the court found it to be a fanciful mark entitled to the broadest protection (but noting that the Flavors part of the name is generic or at most descriptive and Sensient has not shown any evidence that its use of the word Flavors has acquired a secondary meaning).

As for similarity between the marks, because the goods at issue (food flavors) are virtually identical, the degree of similarity that need be shown by Sensient is less. The court found the marks to have a strong phonetic similarity, which is particularly important given that customers are usually contacted over the phone. The court found this factor to weigh in favor of granting the TRO.

The third factor favored Sensient because SF’s allegedly infringing product competes with Sensient’s products. As for SF’s intent to confuse the public, the court did believe that SF’s rationale for its name overcame the obvious prior relationship of SF’s president to Sensient (which creates a strong inference of an intent to confuse) and the knowledge that SF had of Sensient Flavors' existence in the relevant market. The court found that this factor favored granting the TRO.

The degree of care exercised by potential customers actually favored SF because, in this case, potential customers are sophisticated business entities and a high degree of care can be expected.

Finally, regarding evidence of actual confusion, the court found this factor irrelevant under the circumstances given the short period of time in which SensoryFlavors has been operating under such name and the fact that it is too early for Sensient to provide any evidence of actual confusion.

Irreparable Harm
The court relied upon the showing of a likelihood of confusion as support for a showing of irreparable harm (citing Louis Vuitton Malletier v. Burlington Coat Factory Warehouse Corp., 426 F.3d 532, 537 (2d Cir. 2005). Since the court found a likelihood of confusion, the court found that Sensient did face a threat of irreparable harm.

Harm to Defendants
While the court acknowledged that SF may suffer some harm form the TRO, the little harm that would be inflicted (given the short period of time in which SF has used the new name) was outweighed by the irreparable harm to Sensient’s long-established goodwill in the relevant industry.

Public Interest
Because neither party submitted any strong evidence that the public interest would be impacted either way by the TRO and the fact that there is always the public interest in preventing confusion by enforcing trademark laws, the court found this factor to favor granting the TRO.

Conclusion

The court concluded that, on balance, the factors favored granting the TRO to stop SF from using the SensoryFlavors name, and on March 20, 2008, so ordered and set a hearing on Sensient's preliminary injunction (scheduled for today). Of course, given that the factors for deciding a preliminary injunction are the same as the factors for deciding a TRO, SF’s chances of success are not looking very good.