Doral, Florida based Gapardis Health and Beauty, Inc. (“Gapardis) focuses on the import and sale of “off brand” French cosmetics and perfumes which are designed and manufactured in France. Of its over 100 imported French beauty products, one of its items, branded under the name PARIS FAIR & WHITE, as a skin lightening product sold under the following packaging:
The PARIS FAIR & WHITE brand is protected by U.S. Trademark Registration No. 2,497,918 issued by the United States Patent & Trademark Office on the October 16, 2001 in Class 3 for “beauty and skin care products, namely, soaps, lotions, milks, creams and gel for the face and body.”
On January 3, 2012, Flushing, New York based I.C.E. Marketing Corp. (“ICE”) filed an administrative proceeding before the United States Patent & Trademark Office’s Trademark Trial and Appeal Board to cancel Registration No. 2,497,918 for the PARIS FAIR & WHITE brand. From early 2002 to November 2003 that cancellation matter was litigated, through the administrative process of the United States Patent & Trademark Office. Ultimately that ended with the November 2003 joint motion for dismissal which noted a September 8, 2003 negotiated and entered written global settlement agreement. That settlement document ultimately included a consent injunction where ICE agreed to be
Permanently enjoined and restrained from (a) from using
Fast forward over a decade, Gapardis learned in 2014 that ICE produced a solid line of skin-lightening products under the name CLAIR & WHITE which included the following product packaging:
See any similarity with Gapardis’ product packaging for PARIS FAIR & WHITE? Well Gapardis did, and filed an action in the Southern District of Florida to enforce the September 8, 2003 negotiated and entered written global settlement agreement under the theory that ICE’s new packaging constituted “trade dress confusingly similar thereto . . .”
So what is trade dress? Trade Dress is the overall visual image of a product or service that identifies the source of the product or service and distinguishes it from others. It may include the design or configuration of a product; the labeling and packaging of goods; and/or the décor or environment in which the services are provided. http://www.inta.org/TrademarkBasics/FactSheets/Pages/Trade-Dress.aspx. In the United States, trade dress may be protected through its use in commerce via common-law rights or by registration through the U.S. Patent and Trademark Office. In order for trade dress to be registered, it must be both distinctive and nonfunctional. For example, one couldn’t trademark a color if that color serves a function that would make competitors unable to compete. See Brunswick Corp. v. British Seagull Ltd., 35 F.3d 1527, 1994 U.S. App. LEXIS 25150, 32 U.S.P.Q.2D (BNA) 1120 (Fed. Cir. 1994) (the color black functional because of its color-compatibility and because it gives engines a smaller appearance).
The parties held an evidentiary hearing on September 17, 2014 before Magistrate Judge Alicia M. Otazo-Reyes which recommended that a violation had occurred of the prior injunction regarding its prohibition against using similar trade dress. ICE objected to the Magistrate’s findings suggesting that its product packaging did not meet the six or so specific elements restricted by the settlement language, which went before Senior District Court Judge Paul C. Huck.
In addressing the matter, Judge Huck emphasized that trade dress holders must show, by clear and convincing evidence, that defendant’s trade dress is confusingly similar to the specific elements of plaintiff’s trade dress, when viewed individually, or as a whole. This is problematic because common practice of trademark law has been that trademark applications should list as many elements as possible in order to obtain the broadest protection.
However, specificity does quite the opposite because defendants can easily evade liability for infringement by dropping a few similarities. In other words, the more elements listed under the trade dress, the more opportunities for evasion. In the ICE dispute, the injunction language only forbade ICE from producing product packaging for its skin lightening product that was either “confusingly similar” or contained the six carefully listed design elements identified by Gapardis as making up its “inherently distinctive trade dress” for PARIS FAIR & WHITE.
Of those six protected elements identified by Gapardis as its protectable trade dress, Judge Huck found that only one element was entirely reproduced on the CLAIR & WHITE product packaging. Nonetheless, it was determined that although ICE’s packaging bears some visually similarity to Gapardis, it was insufficient to hold I CE liable for violating the terms of the carefully worded injunction.
In short, Judge Huck overruled the magistrate’s initial report and recommendations, denied Gapardis motion for damages, as well as found no violation of the prior settlement terms.
Many lessons to be learned on this one. First and foremost, truly non-functional and distinctive trade dress should be registered with the Trademark Office. If that had happened, perhaps we have a different story here.
Second, this case shows the importance of striking the right balance in drafting and preparing consent decrees and settlements that include trade dress injunctions and restrictions. While certainly a bit of hindsight, if the language of the settlement had been drafted different perhaps the outcome over a decade later would have been different. On one hand, if you describe the trade dress too generally, it is more likely that competitors can tweak your trade dress by adding a significant amount details, thus creating something that would be distinctive to them. On the other hand, if your trade dress is too narrow, competitors can also tweak your trade dress by eliminating or not including certain elements of your protected trade dress and producing the same results, as illustrated in this dispute.
Lastly, another way of addressing this case was through outside expert survey evidence to show that ICE’s new packaging – although outside of the six elements of the settlement terms – was nonetheless “trade dress confusingly similar” to Gaspardi (thereby violating the four provision of the injunction). A trade dress confusion survey – conducted by a recognized trade dress survey expert – could have been created to show such similarity, which would have been an independent basis for seeking enforcement. Its unclear that this was done – but the opinion does hint that this was not an argument presented to the Court.
If you or your business believes that a competitor has designed and created product packaging that is too similar to your prior adopted and marketed packaging – and that there is a risk of consumer confusion – please contact us to discuss your legal rights – including conducting any trade dress research or conducting a trade dress survey.