The opinion of the court was delivered by: KAHN
Plaintiff, Tough Traveler, Ltd., designs and manufactures child carriers--essentially a backpack-type apparatus for carrying children. On April 7, 1994, plaintiff filed a complaint, alleging claims for infringement of trade dress under § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and unfair competition under New York common law. Specifically, plaintiff alleged that defendants Outbound Products, Taymor Industries U.S.A., Inc. and Taymor Industries, Ltd. (collectively "defendants") had copied plaintiff's product, the "Kid Carrier," "causing cheaper, inferior, and confusingly similar child carriers to be manufactured abroad...[and selling] the Outbound carriers in the United States in competition with Tough Traveler." See Tough Traveler, Ltd. v. Outbound Products, 60 F.3d 964, 966 (2d Cir. 1995). This Court (Cholakis, J.) granted plaintiff's motion for preliminary injunction, defendants appealed and the Second Circuit vacated the injunction, finding the presumption of irreparable injury in this case negated by the fact that plaintiff had waited at least nine months after discovering the competing product before filing a complaint, and had delayed another four months before moving for a preliminary injunction. See id. at 968.
Defendants now move for summary judgment on both plaintiff's trade dress infringement claim under § 43(a) of the Lanham Act and plaintiff's claim of unfair competition under New York law. Plaintiff has cross-moved for summary judgment on its unfair competition claim. For the reasons that follow, defendants' motion is granted and plaintiff's motion is denied.
Plaintiff Tough Traveler, a New York corporation, has been manufacturing and selling the Kid Carrier since 1985. The carrier is designed to be "capable of carrying a baby on a person's back during a long hike...while keeping both the baby and adult comfortable." Affidavit of Nancy Gold Establishing Secondary Meaning And/Or Distinctiveness of Plaintiff's Child Carrier ("Gold Aff.") at P 4. The carrier is not protected by a patent or copyright.
Defendant Taymor Ltd. ("Taymor") is a Canadian corporation; Outbound Canada is a division of Taymor, and Taymor Industries U.S.A. is a wholly-owned subsidiary of Taymor. Taymor began selling child carriers in 1984; it does not actually manufacture the child carriers it sells. Zalkow Depo. 110-11, 61-62. Defendants' Outbound 27-750, also referred to as a "Toddler Tote," is the allegedly infringing child carrier. It was first sold in Canada in 1991, and was introduced into the United States in 1992 or 1993.
Plaintiff's complaint alleges that the Kid Carrier's design features are "clearly identified by the purchasing public as products of Tough Traveler," and claims that the design features are protected against infringement on trademark principles. Comp., PP 7, 14, 15. Plaintiff's complaint describes its design features as "including [the padded stripe, the diagonally oriented zipper, the side 'wings' with the straps bisecting them, the seat of the carrier, the "toy loops", the frame including a design for a 'kickstand'], the silhouette, profile and size of the carrier, size and placement of the elements of the carrier, the canvas strap construction and color contrasts, the component layout and stitching pattern, the design, the configuration and placement of hardware, and other design aspects combining to give the Carrier an inherently and aesthetically distinctive, original and arbitrary appearance...." Compl., PP 11, 12.
Defendants sent a Tough Traveler Kid Carrier to its manufacturer prior to the introduction of its "Toddler Tote" 27-750. Zalkow Dep. at 139. Plaintiff asserts that the Kid Carrier was sent to defendants' manufacturer to be duplicated (Zalkow Depo. 269, 272 and Pl. Exh. 1); defendants assert that the Kid Carrier was sent to the manufacturer as a sample of functional elements Taymor wanted incorporated into a new child carrier. Zalkow Depo. 139, 173-75.
Defendants point to differences between their carrier and plaintiff's carrier. Defendants' child carrier is teal-colored with a black padded stripe and the frame is painted black, while plaintiff's carrier frame is unpainted. Defendants have submitted evidence that more than ninety-five percent of plaintiff's Kid Carriers produced have been a royal blue color. Def. Exh. N. Defendants maintain that their carrier is similar to Plaintiff's only with respect to functional features, and that "arbitrary" features such as colors, logos and the product names are "completely different." Zalkow Decl. P 17. Tough Traveler's label and logo (the words "Tough Traveler" appearing over a mountain range) is sewn to the exterior back portion of the Kid Carrier about two inches from the bottom of the four-inch wide stripe. There is no evidence in the record that defendants have ever sold the 27-750 without the Outbound logo ("Outbound") sewn to the exterior back portion of its child carrier.
From 1985-1991, plaintiff allowed the retailer L.L. Bean to sell the Kid Carrier with the L.L. Bean label sewn to the exterior back portion of the carrier in place of the Tough Traveler label. The carriers sold by L.L. Bean were shipped with Tough Traveler hangtags attached, as well as a Tough Traveler product information book, but without the Tough Traveler label sewn anywhere on the carrier.
"Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). "When reviewing the evidence, the court must 'assess the record in the light most favorable to the non-movant and...draw all reasonable inferences in its favor.'" R.B. Ventures, Ltd. v. Shane, 112 F.3d 54, 57 (2d Cir. 1997) (quoting Delaware & Hudson Ry Co. v. Consolidated Rail Corp., 902 F.2d 174, 177 (2d Cir. 1990), cert. denied, 500 U.S. 928, 114 L. Ed. 2d 125, 111 S. Ct. 2041 (1991)). In order to defeat the motion, the nonmoving party must demonstrate the existence of facts establishing that there are material issues of fact for trial. Anderson v. Liberty Lobby, 477 U.S. 242, 256, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).
B. Plaintiff's Lanham Act Claim
Section 43(a) of the Lanham Act provides protection of unregistered trademarks against any person who
in connection with any goods...uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which...is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association 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....
15 U.S.C. § 1125(a); Paddington Corp. v. Attiki Importers & Distrib., 996 F.2d 577, 582 (2d Cir. 1993). This protection extends to trade dress. See Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 773, 120 L. Ed. 2d 615, 112 S. Ct. 2753, reh. denied, 505 U.S. 1244 (1992). Trade dress is "'essentially [a product's] total image and overall appearance.'" Jeffrey Milstein, Inc. v. Greger, Lawlor, Roth, Inc., 58 F.3d 27, 31 (2d Cir. 1995) (citation omitted). The focus in such cases is whether the "entire look of the [allegedly infringing] product" is "likely to cause consumer confusion as to the source of the product." Bristol-Myers Squibb Co. v. McNeil-P.P.C., Inc., 973 F.2d 1033, 1042 (2d Cir. 1992).
Plaintiff seeks trade dress protection for the design and configuration of the Tough Traveler Kid Carrier. It is well established that trade dress may include "the design and appearance of the product as well as that of the container and all elements making up the total visual image by which the product is presented to customers." Id. See also Fabrication Enterprises, Inc. v. Hygenic Corp., 64 F.3d 53, 57 (2d Cir. 1995).
To prevail in an action for trade dress infringement under Section 43(a), plaintiff must prove that its dress is distinctive of the source and that a likelihood of confusion exists between its product and defendants' product. Knitwaves, Inc. v. Lollytogs, Ltd.(Inc.), 71 F.3d 996, 1006 (2d Cir. 1995). Distinctiveness may be established by showing either that a trade dress is either (1) inherently distinctive or (2) that it had acquired distinctiveness through secondary meaning. Two Pesos, Inc., 505 U.S. at 769. Once these elements are established, a defendant may yet prevail by showing that the alleged infringement is in respect of "functional" aspects of the product. See Wallace Int'l Silversmiths, Inc. v. Godinger Silver Art Co., Inc., 916 F.2d 76, 80-81 (2d Cir. 1990), cert. denied, 499 U.S. 976, 113 L. Ed. 2d 720, 111 S. Ct. 1622 (1991).
1. Inherent Distinctiveness
The standard test for whether a trade mark or trade dress is inherently distinctive is that developed in the context of word marks by Judge Friendly in Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 11(2d Cir. 1976). In Abercrombie, the court classified words into four categories: (1) generic, (2) descriptive, (3) suggestive, and (4) arbitrary or fanciful. Id. Only those words falling-into the latter two categories could be deemed inherently distinctive.
However, in Knitwaves, the Second Circuit declined to apply the Abercrombie test in so-called "product configuration" cases, where the trade dress consists of features of the product itself. Id., 71 F.3d at 1007. Reviewing whether the "squirrel" and "leaf" designs on plaintiff's sweaters were protectible trade dress, the court noted that application of the Abercrombie classes to product features made "little sense." Id. It found, referring to the statutory definition of trademark requiring that a person "use" or "intend to use" the mark as a source identifier, 15 U.S.C. § 1127, that application of Abercrombie might result in protection of features "even though they were never intended to serve a source identifying function." Id. The court adopted, as its test, "whether [a product feature or design] 'is likely to serve primarily as a designator of origin of the product.'" Id. at 1008 (quoting Duraco, 40 F.3d 1431 at 1449). The court found that, "as plaintiff's objective was primarily aesthetic, the designs were not primarily intended as source identification." Id.
Since that decision, several courts in the Second Circuit have applied the Knitwaves test in product configuration cases, and have uniformly found that the product design or feature did not serve "primarily" as a designator of origin. See EFS Marketing, Inc. v. Russ Berrie & Co., Inc., 76 F.3d 487, 491 (2d Cir. 1996) (troll dolls); Banff Ltd. v. Express, Inc, 921 F. Supp. 1065, 1070 (S.D.N.Y. 1995)(sweater designs); New York Racing Assoc. v. Perlmutter Publishing, Inc., 959 F. Supp. 578, 581(N.D.N.Y. 1997) (racing horse design on souvenir items).
However, Knitwaves was criticized in Krueger Int'l Inc. v. Nightingale, Inc., 915 F. Supp. 595(S.D.N.Y. 1996) on two grounds. First, the court found that the focus on "intent" imported the evidentiary requirements of secondary meaning, such as advertising and consumer surveys, into the analysis for inherent distinctiveness, thus making the latter redundant. Id. at 602. Second, the court interpreted Knitwaves as creating a false dichotomy between intent to create a pleasing or functional design and intent to create a design which served as a source identifier. In reality, the court argued, a manufacturer will typically intend a design to be both pleasing and source identifying. Id. at 606.
The Second Circuit addressed these criticisms in its most recent decision dealing with trade dress protection for product design, Landscape Forms, Inc. v. Columbia Cascade Co., 113 F.3d 373 (2d Cir. 1997). While reaffirming Knitwaves, the court nevertheless appeared to reinterpret the appropriate test to be merely "whether the design was likely to be understood as an indicator of the product's source," no longer requiring the design to serve "primarily" as an indicator. Id. at 378. The court found that "if Knitwaves forced courts to decide whether a manufacturer's purpose was to create either something of beauty or something indicative of source,...the task would often prove impossible." Id. at 378 n.3. The court thus appears to have moved from the either-or approach of categorizing designs as aesthetic/functional or source-identifying, and instead focuses on the capacity of a design to be source identifying independently of how well it serves other purposes.
The court reviewed the three-factor test for inherent distinctiveness applied in Seabrook Foods, Inc., v. Bar-Well Foods Ltd., 568 F.2d 1342, 1344 (C.C.P.A. 1977), and found that the factors applied in that case were not inconsistent with Knitwaves, but instead, might, "in different contexts, be useful tools to assess whether a design is 'likely to be perceived as a source indicator.'" Landscape Forms, Inc., 113 F.3d at 378 n.3 (citation omitted). These three questions were "whether [the design] was a 'common' basic shape or design, whether it was unique or unusual in a particular field, [and] whether it was a mere refinement of a commonly adopted and well-known form of ornamentation for a particular class of goods." Id. However, the Landscape court looked as a general standard of inquiry to "whether the design, shape or combination of elements is so unique, unusual or unexpected in this market that one can assume without proof that it will automatically be perceived by customers as an indicator of origin...." Id. (citing 1 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition, §§ 8-13(4th ed. 1996)).
Although these clarifications appear to relax the Knitwaves test in several respects, the court in Landscape Forms, Inc. also emphasized that the Lanham Act "must be construed in the light of a strong federal policy in favor of vigorously competitive markets...," id. at 379, and that this policy is strongly implicated when "product designs or configurations are claimed as trade dress. While trademarking a generic term would create a monopoly in a necessary word or phrase, granting trade dress protection to an ordinary product design would create a ...