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Trademark: Starbucks v. Other Companies Essay

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Starbucks v. Obsidian

First Issue: Trademark Dilution

Rule: “Dilution is the lessening of the capacity of a famous mark to identify and distinguish goods or services, regardless of the presence or absence of likelihood of confusion, mistake or deception” (“Trademark Dilution”). To make a trademark dilution claim, a plaintiff must show:

  1. that it owns a famous and distinctive mark;
  2. that the defendant is using a mark that is allegedly diluting the famous mark;
  3. that a similarity between the marks gives rise to an association between the marks;
  4. that the association is likely to impair the distinctiveness or harm the reputation of the famous mark. (Casenote Legal Briefs 24)

Regarding the fourth point, distinctiveness could be defined as the ability of consumers to understand that a product comes from a particular source or has a specific origin (Casenote Legal Briefs 25). In the evaluation of dilution by blurring, courts look at some or all of six factors:

(i) the degree of similarity between the marks; (ii) the distinctiveness of the famous mark, (iii) the degree of the plaintiff’s substantially exclusive use of the famous mark, (iv) the degree of recognition of the famous mark, (v) whether the defendant intended to create an association between the marks, and (vi) the actual association between the marks. (Casenote Legal Briefs 25)

Starbucks Claim: since the FRAPPUCCINO® mark is one of the most recognizable and famous, Starbucks possesses all rights “of protection against likely dilution by blurring and by tarnishment” (Hampy). Obsidian launched the FREDDOCCINO after the FRAPPUCCINO® mark had become famous, and had no right, license of use, or authority from Starbucks. Thus, the similarity of FREDDOCCINO in sound and look will likely count as trademark dilution under 15 U.S.C. § 1125(c).

Obsidian Defense: Even though the name of FREDDOCCINO has some similarity to the sound of FRAPPUCCINO, it is only a minimal degree of similarity. Therefore, there is no harm to the reputation of the FRAPPUCCINO® mark, and the consumers can distinguish between the products as shown in the picture above. Thus, there is no evidence that FREDDOCCINO will harm the FRAPPUCCINO® mark’s reputation.

Second Issue

Infringement of Registered Trademark

Starbucks Claim: The use of the FREDDOCCINO mark for frozen blended beverages by Obsidian could be considered to be used in commerce of reproduction or copy of a trademark which is identified by the U.S. Trademark Registration No. 1., 745,953, 2,148,066, 3,080,371, and 3,535,367, in a way that could deceive customers (Starbucks v. Obsidian Group – Freddoccino 3). Obsidians direct intent was to create links between their products and the FRAPPUCCINO mark with the primary aim of using the well-known brand to benefit from increased sales. It also constitutes an infringement of Starbucks’ trademark and a violation of Section 32(l) of the Lanham Act, 15 U.S.C. § 1114(l) (Starbucks v. Obsidian Group – Freddoccino 3).

Obsidian Defense: Obsidian

Third Claim

Trademark Infringement, Unfair Competition, and False Designation of Origin

Starbucks Claim: Obsidian’s unauthorized use of the FREDDOCCINO mark constitutes:

use in commerce of a word, term, name, symbol, or device, or some combination thereof, or a false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which is likely to cause mistake, or to deceive as to the affiliation, connection, or association among and between the parties and their respective services, or confusion or mistake as to the origin, sponsorship, or approval among and between the parties and their respective services. (“15 U.S. Code § 1125”; Starbucks v. Obsidian Group – Freddoccino 5).

In this way, Obsidian’s use of FREDDOCCINO is “infringement of Starbucks’ trademark, unfair competition, and false designation of origin in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)” (Starbucks v. Obsidian Group – Freddoccino 7).

Fourth Issue

False Advertising

Rule: The Lanham Act prohibits literally false advertising in addition to advertisements that are confusing, misleading, or deceiving. A literally false advertisement violates the Lanham Act without consideration of consumer reactions (“15 U.S.C. §§1051-1127”).

Starbucks Claim: Obsidian is accused of using a specific registered trademark symbol for its FREDDOCCINO mark. In addition, Obsidian uses Fair Trade Certified signage in its U.S. Coffee Culture stores and its online stores claimed to offer fair trade coffee (Starbucks v. Obsidian Group – Freddoccino 5). These constitute the use in commerce of:

a word, term, name, symbol, or device, or some combination thereof, or a false or misleading description of fact, or a false or misleading representation of fact, in commercial advertising or promotion, that misrepresents the nature, characteristics, qualities, or geographic origin of goods, services, or commercial activities. (Casenote Legal Briefs 76)

Under these conditions, the companys actions corrupted the nature, basic characteristics, and sources of its goods and provided customers with the false information about them trying to impact their purchasing decisions (Starbucks v. Obsidian Group – Freddoccino 8).

Obsidian’s conduct is willful, as evidenced by the fact that the “FREDDOCCINO mark is not registered in the United States and that Coffee Culture does not offer Fair Trade Certified coffees in all of its stores” bearing the Fair Trade Certified signage (Starbucks v. Obsidian Group – Freddoccino 4). Obsidian’s acts constitute “false or misleading descriptions of fact or false or misleading representations of fact in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)” (Casenote Legal Briefs 56).

Starbucks v. Dabuccino

Rule: The Lanham Act, 15 U.S.C. § 1114, states that any person who uses in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive… can be held liable for such use. (15 U.S. Code § 1114)

Based on this, Starbucks will argue that James Landgraf and his partners are committing trademark infringement since they are using reproductions of registered Starbucks Frappuccino cups in the line of bongs (or “water pipes”) that they released for sale (Starbucks v. Obsidian Group – Freddoccino 9).

James Landgraf, and his partners may argue that there is difference in the present logo as well as actual use of the product. Furthermore, the lines do not compete, so it could be argued that there is no infringement.

The End’ v. Starbucks

Unfair Competition, and False Designation of Origin

Rule: “The End” Claim: “By virtue of its extensive use, registration, advertising, promotion, and consumer and marketplace recognition, the UNICORN LATTE mark is famous and distinctive, and is entitled to protection against likely dilution by blurring and by tarnishment” (Starbucks v. Obsidian Group – Freddoccino 5). As far its wide use, registration, advertising, promotion, and marketplace recognition, is protected by the law, all trademark rights of the UNICORN LATTE are protected from dilution by blurring and tarnishment (Casenote Legal Briefs 56). After 15 months of production and advertising, the UNICORN LATTE became popular and famous, which could obviously result in a mistake regarding the sponsorship, affiliation, and other aspects of the willful violation of the trademarks rights according to the Lanham Act, Sections 32 and 43, 15 U.S.C. §§ 1114, 1125 (“15 U.S. Code § 1114”).

Trademark Dilution

Rule: To make a trademark dilution claim, a plaintiff must show:

  1. that it owns a famous and distinctive mark;
  2. that the defendant has commenced using a mark that is allegedly diluting the famous mark;
  3. that a similarity between the marks gives rise to an association between the marks;
  4. that the association is likely to impair the distinctiveness or harm the reputation of the famous mark. (“Trademarks: Likelihood of Confusion and Dilution”)

In the fourth section, distinctiveness refers to the ability of consumers to recognize that the product comes from a particular source. In evaluating dilution by blurring, courts look at six factors:

(i) the degree of similarity between the marks; (ii) the distinctiveness of the famous mark, (iii) the degree of the plaintiff’s substantially exclusive use of the famous mark, (iv) the degree of recognition of the famous mark, (v) whether the defendant intended to create an association between the marks, and (vi) the actual association between the marks. (Casenote Legal Briefs 25)

“The End” Claim: Since “The End” owns the distinctive UNICORN LATTE mark and Starbucks launched their similarly-colored Unicorn Frappuccino mark after the UNICORN LATTE became famous, the average consumer may not recognize the distinctiveness. Starbucks’ acts constitute trademark dilution in violation of the Lanham Act, 15 U.S.C. § l 125(c).

Starbucks v. Bill

Rule: “The noncommercial use of a trademark as the domain name of a website – the subject of which is consumer commentary about the products and services represented by the mark – does not constitute infringement under the Lanham Act” (“15 U.S. Code § 1125”).

Bosley Medical Group v. Kremer

Bill Defense: Since Bill has not yet commenced the sale of the vessel he is not committing infringement under the Lanham Act.

Starbucks will argue that since Bill distributed the vessels that has registered Trademark logo on them, he is infringing the Lanham Act, 15 U.S.C. § 1114.

The Old Farmer’s Almanac v. New York Magazine, Hale and others

In order to prove trademark infringement, the owner of the trademark must prove three elements of a trademark infringement claim, which are

  1. validity,
  2. priority and
  3. likelihood of confusion.

Validity

The first element that a plaintiff must prove is that it owns a valid trademark. For the owners of a federal trademark registration, the registration acts as prima facie evidence that the mark is valid. In this case, The Old Farmer’s Almanac had worldwide recognition and so the publisher of the Old Farmer’s Almanac had never troubled to seek federal registration of its trademarks. This is more likely to prove that The Old Farmer’s Almanac’s mark was valid. However, the New York Magazine, Hale and others might argue that “almanac” is merely a description of the product. By definition, an almanac is “a book containing a calendar of a given year, with a record of various astronomical phenomena, often with weather prognostications, seasonal suggestions for farmers, and other information” (Encyclopedia Britannica 45). It is neither a compilation nor a gift catalog. The Old Farmer’s Almanac and the Farmer’s Almanac could argue that even though the name could be considered descriptive, it still has acquired secondary meaning.

When determining whether or not a mark has acquired secondary meaning, a court will look at both direct and circumstantial factors. To prove that a defendant has committed unfair competition by trademark infringement under common law, a plaintiff must show that the trademark was valid and eligible to be protected under trademark law and that it was infringed upon by the defendant (“Trademark Infringement”). In order to prove that a particular trademark is valid, a plaintiff must demonstrate that that the mark is either inherently distinctive or has acquired secondary meaning (“Litigation Procedures and Strategies: United States”). A mark can also get a secondary meaning if consumers have come to associate the mark with a single producer of a specific product (“Litigation Procedures and Strategies: United States”). To ascertain secondary meaning, courts look at direct evidence of consumer surveys and testimony and exclusive use of the mark, as well as circumstantial evidence such as the amount of advertising behind the mark, the amount of sales and number of customers, whether there is an established place in the market for the product, and whether the defendant intentionally copied the plaintiff (Echo Travel, Inc. v. Travel Associates, Inc.).

Priority

In this case The Old Farmer’s Almanac had worldwide recognition and has been continuously published since 1792, which shows the priority of use. While the publisher of the Old Farmer’s Almanac had never troubled to seek federal registration of its trademark, circulation had risen from 3,000 to 9,000 copies within three year and has also has been online since 1997, which indicates that the court will likely consider the consumer and circumstantial evidence. Therefore, The Old Farmer’s Almanac still has a valid trademark.

Likelihood of Confusion

The likelihood of confusion may be established using the eight-factor test from Polaroid Corp. v. Polarad Electronics Corp., 287 F.2d 492 (2d Cir. 1961), which looks at: (1) the strength of the registered mark; (2) the similarity between the registered mark and the mark used by the alleged infringer; (3) the allegedly infringing product’s competitive proximity to the registered owner’s product; (4) the likelihood that the registered owner will bridge the gap to enter the same market as the alleged infringer; (5) actual misinforming and confusion of the part of purchasers; (6) the alleged infringer’s good faith; (7) the quality of the alleged infringer’s product; and (8) the complexity, sophistication, and other features of buyers in the relevant market (“Likelihood of Confusion Tests by Circuit”).

In this case, The Old Farmer’s Almanac had worldwide recognition and never troubled to seek federal registration of its trademark, but still has veiled trademark right. The eight-factor test is satisfied in this case. First, The Old Farmer’s Almanac mark is strong because it is registered and had worldwide recognition. Second, the mark used by the New York Magazine, Hale and others is identical to the Farmer’s Almanac mark. Third, there is competitive proximity because the products of the New York Magazine, Hale and others are gardening/gift books that look similar to The Old Farmer’s Almanac’s gardening/gift book. Fourth, there is gap to bridge since the New York Magazine, Hale and others are publishing which include “almanac product” in 2018 by Blum Corporation, an advertisement that is the almost the same as the The Old Farmer’s Almanac. This factor considers the actual steps taken by the New York Magazine, Hale and others to expand their business in addition to the conceptual idea of the “zone of expansion.” Trademark law gives trademark owners the rights to not only their current mark, but also the reasonable zone of expansion.

Fifth, the actual confusion occurred when it was stated that “Celebrating 190 years Blums Farmers and Planters Almanac has been a reliable companion to readers since 1828,” which is showing enough confusion to establish a Lanham Act violation. Sixth, New York Magazine, Hale and others clearly designed their magazine to resemble The Old Farmer’s Almanac and have not produced evidence that they published their almanac in good faith. Additionally, they chose the random date of 1990 which does not refer to the publishing date but instead to something unrelated. Seventh, New York Magazine, Hale and others’ almanac magazines are of significantly lower quality than The Old Farmer’s Almanac and Farmer’s Almanac magazines, because they included specific information such as solar activity, astronomy cycles and weather patterns, and research was used to develop a secret forecasting formula which has worldwide recognition. This makes it important for The Old Farmer’s Almanac and Farmer’s Almanac to protect their reputation. Eighth, although some consumers buying New York Magazine, Hale and others’ magazines may realize they are not authentic as The Old Farmer’s Almanac and Farmer’s Almanac magazines, other potential consumers may still be confused by the misrepresentation of advetrising about the publishing date. This harms the reputation of Old Farmer’s Almanac and Farmer’s Almanac magazines and their consumers. Thus, there is a high likelihood that potential customers can be confused by New York Magazine, Hale and others’ conduct which creates a trademark infringement.

Works Cited

Casenote Legal Briefs. Casenote Legal Briefs: Trademark and Unfair Comp Law, Keyed to Ginsburg, Litman, and, Kevlin. Wolters Kluwer Law & Business, 2014.

“Encyclopedia Britannica.” Britannica Concise Encyclopedia, 2007.

Cornell Law School, Web.

Cornell Law School, web.

Hampy, Tyler. “Trademark Dilution: Blurring v. Tarnishment.” Legaltemusa, 2012, Web.

“Likelihood of Confusion Tests by Circuit.” Trademarkwell, Web.

World Trademark Review, Web.

2016, Web.

Law Shelf, Web.

Cornell Law School, Web.

“Trademarks: Likelihood of Confusion and Dilution.” Jux, Web.

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