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| FindLaw: Laws: Cases and Codes: 9TH CIRCUIT COURT Opinions | |
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http://laws.findlaw.com/9th/9856801.html
KATHERINE WALTER, an individual, aka Pearl Beach, dba Pearl Beach, No. 98-56801 Plaintiff-Appellant, D.C. No. v. CV-98-02048-RJK MATTEL, INC., a Delaware OPINION corporation, Defendant-Appellee.
Appeal from the United States District Court
Central District of California
Robert J. Kelleher, Senior Judge, Presiding
Argued and Submitted
April 3, 2000--Pasadena, California
Filed April 26, 2000
Before: Stephen Reinhardt and Diarmuid F. O'Scannlain,
Circuit Judges, and William W Schwarzer,*
Senior District Judge.
Opinion by Judge Schwarzer
SUMMARY
The summary, which does not constitute a part of the opinion of the court,
is copyrighted C 2000 by West Group.
_________________________________________________________________
Intellectual Property/Trademark
The court of appeals affirmed a judgment order of the dis-
trict court. The court held that in a trademark-infringement
action under the Lanham Act, a likelihood of reverse confu-
sion does not occur when a well-known user of a junior mark
features it in connection with the sale of children's toys, while
the small junior mark appears in advertising aimed at sophisti-
cated buyers of commercial art.
Since 1978, appellant Katherine Walter did business as
"Pearl Beach," displaying the name with a small shell and
pearl logo on business cards, advertisements, and promotional
postcards. Walter's business was illustrating advertising mate-
rials and packaging for sophisticated buyers of commercial
art. Walter did not obtain trademark registration for her trade
name.
After conducting a trademark search that yielded no con-
flicting uses, appellee Mattell, Inc. decided to use "Pearl
Beach Barbie" as the name of its 1998 "pool and beach" Bar-
bie doll. The doll was sold in large retail and discount stores,
packaged in the distinctive hot pink Barbie boxes bearing
Barbie and Mattel logos. The box had "Pearl Beach Barbie"
in a sandy print with a large seashell in the background. The
consumers targeted by Mattel's advertising were young girls.
Walter sued Mattel for trademark infringement. She alleged
that Mattel's use of the name "Pearl Beach Barbie " and its
packaging created a perception of a business relationship
between Walter and Mattel when none existed.
In a bench trial, the evidence showed that in Walter's mate-
rials, "Pearl Beach" appeared in a plain font near a mono-
chrome, stylized scallop shell with a pearl at the center.
Mattel's packaging depicted a bright pink radial sculpture
clamshell tilted to one side with "Pearl Beach " in wavy,
sandy-textured script with glitter accents over the name "Bar-
bie" or "Friend of Barbie."
The district court concluded that Walter failed to prove a
likelihood of reverse confusion and ruled for Mattel. Walter
appealed.
[1] The Ninth Circuit has recognized claims for reverse
confusion to protect the small senior user from losing control
over its identity in the publicity associated with the junior
mark. [2] The question in such cases is whether consumers
doing business with the senior user might mistakenly believe
that they are dealing with the junior user. [3] The test for false
designation under the Lanham Act is whether there was a
likelihood of confusion.
[4] The parties' respective products were not complemen-
tary, not sold to the same class of purchasers, and not similar
in use or function. [5] The appearance of the respective marks
negated any similarity. The term "Pearl Beach " in Mattel's
products never appeared alone; rather it was accompanied by
a reference to Barbie, which was clearly the salient part of the
mark indicative of the product's origin. The district court cor-
rectly concluded that Walter's distinctive logo was not similar
in appearance to Mattel's packaging of its Pearl Beach prod-
ucts.
[6] Since attestations from persons in close association and
contact with the senior user do not reflect the views of the
purchasing public, the district court correctly found Walter's
evidence of actual confusion from acquaintances, friends, and
family insufficient.
[7] The district court correctly rejected the argument that
because Mattel employees who had not worked on Pearl
Beach Barbie had met Walter, Mattel's failure to investigate
satisfied the intent factor. Mattel conducted a reasonable
investigation into existing uses of the name "Pearl Beach."
[8] Walter's arguments were peripheral at best. The heart
of the matter was whether she established a likelihood of con-
fusion. For sophisticated purchasers of commercial art to
believe that Mattel would display Walter's name so promi-
nently would not have been reasonable. The holder of such a
belief could not have been considered a "reasonable consum-
er." Walter could not prove a likelihood of confusion.
_________________________________________________________________
COUNSEL
Paul A. Larsen, Ku, Fong, Larsen & Chen, Pasadena, Califor-
nia, for the plaintiff-appellant.
Adrian Pruetz, Quinn, Emanuel, Urquhart, Oliver & Hedges,
Los Angeles, California, for the defendant-appellee.
_________________________________________________________________
OPINION
SCHWARZER, Senior District Judge:
Mattel, Inc., produces and markets, among other products,
the well-known line of Barbie dolls to which it added in 1998
the "Pearl Beach Barbie." Unbeknownst to Mattel, Pearl
Beach was the trade name under which plaintiff Katherine
Walter had done business as a commercial illustrator since
1978. Having learned of Pearl Beach Barbie, plaintiff brought
this action alleging misappropriation of her trade name and
marks in violation of the Lanham Act and state unfair compe-
tition law. Her case presents the reverse of the usual trade-
mark infringement case in which the well-known senior mark
sues the obscure junior mark to prevent a free ride on the
senior's good will. Instead, it is the little-known senior mark
who seeks the protection of the Lanham Act, fearing that cus-
tomers will think that she is associated with the more promi-
nent junior mark. The district court entered judgment for
Mattel, and we affirm.
FACTS
Since 1978, plaintiff Katherine Walter has done business as
Pearl Beach, displaying the moniker alongside a small shell
and pearl logo on her business cards, her advertisements, and
her promotional postcards. Her business is to illustrate adver-
tisements, brochures, and product packaging for her custom-
ers, who are all sophisticated purchasers of commercial art. In
1979, she filed a fictitious business name statement with the
Los Angeles County Clerk's Office for "Pearl Beach," but it
expired in 1984, and she never attempted to renew it nor does
she hold federal or state trademark registrations for her trade
name.
Defendant Mattel, a well-known manufacturer of a variety
of products, has marketed the popular line of Barbie dolls
since 1959. Mattel's Barbie line, which has expanded over the
years, includes an annual "pool and beach" doll. Past "pool
and beach" Barbies have included "Tropical Splash Barbie,"
"Sparkle Beach Barbie," and "Sun Jewel Barbie." The target
market for this line is girls aged three to ten. In mid-1996,
Mattel's designer, Cassidy Beal Park, conducted the initial
research for the 1998 doll and discovered pearl jewelry was
a popular trend among young girls. Since she thought pearls
had a natural association with beaches, she created the name
"Pearl Beach Barbie" for the 1998 doll. Park testified that
when she brainstormed the name, she had never heard of
Katherine Walter or a commercial artist named Pearl Beach.
Mattel conducted a trademark search and, finding no conflict-
ing uses, settled on "Pearl Beach Barbie" for the 1998 "pool
and beach" Barbie. It was sold from December 1997 to
December 1998 in large retail toy and discount stores, pack-
aged in the distinctive hot pink Barbie box bearing the Barbie
and Mattel logos. The box had "Pearl Beach Barbie " in a
sandy print with a large asymmetrical shell in the background.
Mattel ran one television advertisement for the doll in Spring
1998, targeting young girls.
On March 23, 1998, plaintiff brought this action, alleging
(1) false designation of origin and false description under the
Lanham Act, 15 U.S.C. S 1125(a), (2) common-law unfair
competition, and (3) statutory unfair competition under Cali-
fornia Business & Professions Code section 17200. Cal. Bus.
& Prof. Code S 17200 (West 2000).1 At the end of plaintiff's
case at a bench trial, the court granted Mattel's motion under
Federal Rule of Civil Procedure 52(c) and entered judgment
for Mattel, holding that plaintiff failed to prove a likelihood
of reverse confusion. See Walter v. Mattel, 31 F. Supp. 2d 751
(C.D. Cal. 1998).
DISCUSSION
Section 43(a) of the Lanham Act states in relevant part:
Any person who, on or in connection with any goods
. . . uses in commerce any word, term, name, symbol
. . . or any false designation of origin . . . which (A)
is likely to cause confusion, or to cause mistake, or
to deceive as to the affiliation, connection, or associ-
ation of such person with another person, or as to the
origin, sponsorship, or approval of his or her goods,
services, or commercial activities by another person
. . . shall be liable in a civil action by any person who
believes that he or she is or is likely to be damaged
by such act.
15 U.S.C. S 1125(a).
[1] Plaintiff contends that Mattel's use of the name Pearl
Beach Barbie and its product packaging creates the perception
of a business relationship between plaintiff and Mattel when
no such relationship exists. She focuses on the text of section
43(a) providing for liability when the use of a trade name "is
likely to cause confusion . . . as to the affiliation, connection,
or association of such person with another person. " Fearing
that the market power of a large firm may oppress the intel-
lectual property rights of her small operation, she claims
reverse confusion, i.e., that her customers will be confused as
to her relationship to Mattel, the junior mark. We have recog-
nized claims for reverse confusion to protect the small senior
user from losing control over its identity in "the rising tide of
publicity associated with the junior mark." Dreamwerks Prod.
Group Inc. v. SKG Studio, 142 F.3d 1127, 1129 (9th Cir.
1998).
[2] Plaintiff argues first that the district court erroneously
limited Lanham Act liability to confusion of source. The argu-
ment misconstrues and distorts the court's ruling. While the
court rejected plaintiff's proposed "somehow associated with"
test and mentioned confusion of source, its analysis was
expressly based on Dreamwerks: " `The question in such
cases is whether consumers doing business with the senior
user might mistakenly believe that they are dealing with the
junior user.' " Walter, 31 F. Supp. 2d at 757-58 (quoting
Dreamwerks, 142 F.3d at 1130). The court concluded that
"[p]laintiff must show that . . . when sophisticated commercial
art purchasers encounter the Plaintiff's illustrations or illustra-
tion services in the market place, those customers mistakenly
believe that Mattel is the source or sponsor of those illustra-
tions or illustration services." Walter, 31 F. Supp. 2d at 758
(emphasis added). Because we can see no difference in sub-
stance, as applied to this case, between "association" and
"sponsor," (and indeed in its brief the plaintiff equated the
two) we cannot say that the court unfairly narrowed the appli-
cation of the Lanham Act.
[3] Plaintiff's second argument is that the court applied the
wrong legal standard in determining whether likelihood of
confusion exists. The test for false designation under the Lan-
ham Act, as well as the common-law and statutory unfair
competition claims, is whether there was a "likelihood of con-
fusion." See Cleary v. News Corp., 30 F.3d 1255, 1262-63
(9th Cir. 1994); Dreamwerks, 142 F.3d at 1129-30. We
review the trial court's determination concerning likelihood of
confusion for clear error. See Levi Strauss & Co. v. Blue Bell,
Inc., 778 F.2d 1352, 1355 (9th Cir. 1985) (en banc). In AMF
Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-49 (9th Cir. 1979),
we listed eight factors that guide the inquiry: (1) strength of
the mark;2 (2) proximity or relatedness of the goods; (3) simi-
larity of the marks; (4) evidence of actual confusion; (5) mar-
keting channels; (6) type of goods and degree of purchaser
care; (7) intent in selecting mark; and (8) likelihood of expan-
sion.
[4] Plaintiff takes issue with the court's application of four
of these factors. First, plaintiff argues in substance that her
goods and Mattel's are related because plaintiff sells product
packaging for toy dolls. The district court correctly rejected
plaintiff's "conceptual approach," finding that the parties'
respective products are not complementary, not sold to the
same class of purchasers, and not similar in use or function.
See Walter, 31 F. Supp. 2d at 759.
[5] Second, addressing the similarity of marks factor, plain-
tiff reiterates that Mattel's use of its distinctive logo in con-
junction with the name Pearl Beach implies that Pearl Beach
licensed the product. The appearance of the respective marks,
however, negates any similarity. Occasionally, in Walter's
materials, the term "Pearl Beach" appeared in plain font either
above or below a monochromatic, stylized scallop shell with
a pearl at the center of the shell. In contrast, Mattel's packag-
ing depicts a bright pink radial sculpture clamshell tilted to
one side with the words "Pearl Beach" in wavy, sandy-
textured script with glittery accents over the name "Barbie"
(or "Friend of Barbie"). The term "Pearl Beach" in Mattel's
products never appears alone; rather, it is invariably accompa-
nied by a reference to Barbie, which is clearly the "salient part
of the mark indicative of the product's origin." Sleekcraft, 599
F.2d at 351. In other words, "Barbie" is the dominant part of
the "Pearl Beach Barbie" mark. Accordingly, the district court
correctly concluded that plaintiff's own distinctive logo is not
similar in appearance to Mattel's packaging of its Pearl Beach
products.
[6] Third, plaintiff argues that the district court disregarded
evidence of actual confusion. Since "[a]ttestations from per-
sons in close association and intimate contact with[the senior
user] do not reflect the views of the purchasing public," Self-
Realization Fellowship Church v. Ananda Church of Self-
Realization, 59 F.3d 902, 910 (9th Cir. 1995) (citation omit-
ted), the district court correctly found plaintiff's evidence of
actual confusion from acquaintances, friends, and family
insufficient. See Walter, 31 F. Supp. 2d at 760.
[7] Fourth, plaintiff argues that because two of Mattel's
employees who never worked on Pearl Beach Barbie had met
plaintiff, we should impute that information to Mattel and
hold that Mattel's failure to investigate satisfies the intent fac-
tor. The district court correctly rejected the argument after
finding that Mattel had conducted a reasonable investigation
into existing uses of the name "Pearl Beach." See id. at 761-
62.
[8] In the end, plaintiff's arguments are peripheral at best.
The heart of the matter is whether plaintiff established a like-
lihood of confusion. The court found:
If there is any confusion in this case, it occurs when
Plaintiff's customers encounter Pearl Beach Barbie
in a toy store, not when commercial art buyers
encounter Plaintiff's work in the relevant market
place . . . . [F]or sophisticated purchasers of com-
mercial art to believe that Mattel would display
Plaintiff's name so prominently, even if it had used
her illustrations on the package, would not be rea-
sonable. The Court is not convinced that the holder
of such a belief could be considered "a reasonable
consumer," and thus Plaintiff has not, indeed cannot,
show the type of confusion she must to properly
prove a likelihood of reverse confusion.
Id. at 758.
We conclude that the court's findings were not clearly erro-
neous.
AFFIRMED.
_______________________________________________________________
FOOTNOTES
*The Honorable William W Schwarzer, Senior District Judge for the
Northern District of California, sitting by designation.
1 We treat the federal and state claims as coextensive for purposes of
reviewing the district court's ruling because all of the claims turn on the
sufficiency of proof of likelihood of confusion. See Dreamwerks Prod.
Group, Inc. v. SKG Studio, 142 F.3d 1127, 1129 n.2 (9th Cir. 1998).
2 The district court found plaintiff's mark to be strong, a finding which
plaintiff does not challenge. See Walter, 31 F. Supp. 2d at 759. In a
reverse confusion case, however, the inquiry focuses on the strength of the
junior mark because the issue is whether the junior mark is so strong as
to overtake the senior mark. See Dreamwerks, 142 F.3d at 1130 n.5. Mis-
application of this factor does not affect the outcome of this case.
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