Opal Financial Group, Inc. v. Opalesque, Ltd.
Opal Financial Group, Inc. v. Opalesque, Ltd.
Opinion of the Court
SUMMARY ORDER
Opal Financial Group, Inc. (“OFG”) appeals from a judgment entered after a three-day bench trial on an action brought for trademark infringement in violation of the Lanham Act, 15 U.S.C. § 1051, et seq., and unfair competition under Connecticut common law. Before the District Court, OFG sought injunctive and monetary relief from Opalesque, Ltd. (“Opalesque”) and Matthias Knab (“Knab”), who denied any liability to the Plaintiff and asserted a counterclaim under the Connecticut Unfair Trade Practices Act, Conn. Gen.Stat. § 42-110b, et seq.
OFG brought its trademark infringement claim pursuant to the Lanham Trademark Act, whose principal provisions are found in § 32(1), 15 U.S.C. § 1114(1), and § 43(a), 15 U.S.C. § 1125(a). In our Circuit, a claim of trademark infringement “is analyzed under the familiar two-prong test,” which “looks first to whether the plaintiffs mark is entitled to protection, and second to whether defendant’s use of the mark is likely to cause consumers confusion as to the origin or sponsorship of the defendant’s goods.” Virgin Enters. Ltd. v. Nawab, 335 F.3d 141, 146 (2d Cir. 2003) (citations omitted).
“[T]he crucial issue in an action for trademark infringement or unfair competition is whether there is any likelihood that an appreciable number of ordinarily prudent purchasers are likely to be misled, or indeed simply confused, as to the source of the goods in question.” Mushroom Makers, Inc. v. R.G. Barry Corp., 580 F.2d 44, 47 (2d Cir. 1978) (per curiam), cert. denied, 439 U.S. 1116, 99 S.Ct. 1022, 59 L.Ed.2d 75 (1979). In evaluating whether a trademark owner claiming infringement has satisfied its burden of showing a likelihood of consumer confusion, courts in this Circuit routinely apply the non-exclusive multi-factor analysis developed by Judge Friendly in Polaroid Corp. v. Polarad Electronics Corp., 287 F.2d 492 (2d Cir. 1961). See Arrow Fastener Co., Inc. v. Stanley Works, 59 F.3d 384, 391 (2d Cir. 1995), These factors, include the following: (1) the strength of the mark, (2) the similarity of the two marks, (3) the proximity of the products, (4) actual confusion, (5) the likelihood of plaintiffs bridging the gap, (6) defendant’s good faith in adopting its mark, (7) the quality of defendant’s products, and (8) the sophistication of the consumers. See, e.g., Louis Vuitton Malletier v. Dooney & Bourke, Inc., 454 F.3d 108, 116 (2d Cir. 2006) (listing the Polaroid factors).
OFG first argues that the District Court erred in its treatment of OFG’s admission within its summary judgment papers that it had never offered professional continuing education credits in connection with its conferences. The District Court deemed
OFG argues that the District Court clearly erred in its separate determinations regarding each of the eight Polaroid factors, particularly “the proximity of services and marks and the evidence of actual confusion as embodied in the survey results.” Appellant’s Br. 16. On the issue of proximity, the District Court found that the parties offered different services solely because OFG’s “principal service” was “organizing and producing networking conferences of several days’ duration at resorts,” whereas Opalesque’s “principal services” were “online newsletters and brief online webinars sans networking.” Special App’x 44-45 (emphasis omitted). In our view, the District Court placed too much emphasis on that fact. It is true that the parties’ principal services differ, and that. Opalesque’s allegedly infringing educational events amounted to a small, short-lived business. But, although the proportion of a defendant’s product line that allegedly infringes the plaintiffs products may be relevant to a court’s proximity analysis, see, e.g., Nikon Inc. v. Ikon Corp., 987 F.2d 91, 95 (2d Cir. 1993), the fact that Opalesque’s allegedly infringing products are not its “principal service” cannot, on its own, establish a lack of proximity. To the extent that the District Court’s decision suggests otherwise, we disagree.
Nevertheless, additional evidence in the record supports the District Court’s conclusion that the parties’ products differed substantially. Regarding the Global Alpha Forum—the allegedly infringing product that most closely resembled OFG’s conferences—the District Court found (not erroneously) that Opalesque served as a media partner rather than a conference producer, which distinguishes its service from OFG’s.
We also conclude that the District Court’s separate determinations regarding the remaining Polaroid factors were not clearly erroneous. OFG does not dispute the court’s basic findings regarding three of the factors—the strength of the plaintiffs mark, the similarity of the two marks, and the quality of defendants’ products— and we conclude that those findings were not clearly erroneous.
We have considered all of OFG’s remaining arguments and find them to be without merit. For the foregoing reasons, we AFFIRM the judgment of the District Court.
. “In the trademark context, we review the district court’s determinations as to each separate factor in Polaroid's multifactor test for clear error, while the court’s ultimate balancing of those factors is a matter of law subject to de novo review.” Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., 588 F.3d 97, 105 (2d Cir. 2009) (citations omitted). "[Wjhether conducting review de novo or under a less sweeping standard, we ‘must disregard all errors and defects that do not affect any party's substantial rights.’ ” Lore v. City of Syracuse, 670 F.3d 127, 150 (2d Cir. 2012) (quoting Fed.R.Civ.P. 61). "A substantial right is not implicated if there is no likelihood that the error or defect affected the outcome of the case.” Id. We assume the parties’ familiarity with the facts and record below, which we reference only as necessary to explain our decision.
. OFG argues that regardless of what Opalesque ultimately did at the conference, it presented itself as a conference organizer in the event’s brochure. In OFG’s view, the District Court’s proximity analysis, which focused largely on what Opalesque objectively did at the conference, improperly dismissed the effect of this brochure on the consumer population. It is true that how a party sells its product—not simply the objective nature of that product—is indeed relevant when assessing the likelihood of confusion in general, and the proximity of products in particular. Here, however, the record supports the determination that the brochure would not lead consumers to believe Opalesque was organizing the conference. The District Court emphasized the fact that "[t]he brochure itself reflects [the] reality [that Opalesque was just a media sponsor]. Immediately following the ‘Hosted By' heading and the two logos, the brochure readers were instructed: 'For questions or to register by phone, please call the Connecticut Hedge Fund Association—’ " Special App’x 30, Given the District Court’s non-erroneous finding that consumers of these conferences were highly sophisticated and understood the distinction between organizers and media partners, it was not clear error for the District Court to determine, even in light of the brochure, that the Defendants
. OFG argues that the District Court clearly erred in "not finding (indeed, not even discussing) that OFG had established a common law mark in the word OPAL." Appellant’s Br. 16. We find that this silence, insofar as it was error, did not affect the outcome of the case. Recognition of the mark “Opal” would have been relevant to only two of the Polaroid factors: the strength of the mark and the similarity of the two marks. But both of those factors already favored OFG in the District Court’s analysis: The court found that OFG could “justly proclaim the strength of its mark,” Special App'x 46 (emphasis omitted), and that the similarity of its mark to the defendants' mark was "certainly apparent,” id. at 47. Consideration of the mark “Opal” might have further bolstered those conclusions, but it would not have substantively altered the court's Polaroid analysis in OFG’s favor. Any error by the District Court on this issue, therefore, was not prejudicial,
. OFG argues as to actual confusion that the District Court misinterpreted OFG’s examination of the expert who prepared the survey, an error that, in concert with others, rendered the District Court’s ultimate determination that OFG had not presented sufficient evidence of actual confusion clearly erroneous. We disagree that this ultimate determination was clear error. The District Court stated that "counsel's examination got [the expert] to acknowledge that his calculations did not include, as a form of brand confusion, the answer made by 3.9% of the respondents that Opal Financial Group and Opalesque are ‘one and the same company.' ” Special App’x 40. In fact, the record makes clear that counsel for OFG solicited from the expert an acknowl-edgement that the .expert’s calculations had failed to include the answer made by 13.7% of the respondents that OFG and Opalesque "are jointly owned by a larger company.” Joint App’x 183, 765.
OFG is right that the District Court erred in this respect, and that there is an important distinction between 3.9% and 17.6%. (i.e., the actual total number of respondents who showed some confusion on the survey, properly understood). Nevertheless, it is not right that the District Court’s ultimate conclusion— that "it cannot be said that this .market research survey furnishes evidence of actual confusion”—was erroneous. Special App'x 40. As an initial matter, the 17.6% figure carries a margin of error of plus or minus 10 percentage points, Joint App’x 758, which supports the District Court’s ultimate decision to accord- little or no weight to its findings. See Borinquen Biscuit Corp. v. M.V. Trading Corp., 443 F.3d 112, 120 n. 6 (1st Cir. 2006) (concluding that an expert report’s "small sample size and large margin of error combined to cast considerable doubt on its statistical integrity”); Alltel Corp. v. Actel Integrated Commc’ns, Inc., 42 F.Supp.2d 1265, 1269, 1273 (S.D.Ala. 1999) (holding that an expert, report was of "little evidentiary value” be
Even putting aside this and various other flaws in the survey, the survey stated in its executive summary that "[t]op-of-mind awareness of Opal Financial Group and Opalesque is extremely low” and thus "[i]t is impossible to conclude that brand confusion exists where awareness is extremely low.” Joint App'x 759. Opalesque’s counsel highlighted this point in his cross examination. Joint App’x 188. The expert never disclaimed this finding on the stand. As such, neither the survey nor any appreciable additional evidence presented at trial by OFG rendered the District Court’s ultimate conclusion as to actual confusion clearly erroneous.
Reference
- Full Case Name
- OPAL FINANCIAL GROUP, INC., Plaintiff-Counter-Defendant-Appellant v. OPALESQUE, LTD. and Matthias Knab, Defendants-Counter-Claimants-Appellees
- Cited By
- 5 cases
- Status
- Published