concerning the nature of goods. Id. "[T]he term `fanciful', as
a classifying concept, is usually applied to words invented
solely for their use as trademarks. When the same legal
consequences attach to a common word, i.e., when it is applied in
an unfamiliar way, the use is called `arbitrary.'" Abercrombie,
537 F.2d at 11 n. 12. Arbitrary, fanciful, or suggestive marks
are considered "inherently distinctive," and are therefore
automatically entitled to Lanham Act protection. See Two Pesos,
Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768, 112 S.Ct. 2753,
120 L.Ed.2d 615 (1992).
In the present case, the MONTECRISTO trademark is an arbitrary
mark, and therefore among the strongest and most highly protected
class of trademarks. Abercrombie 537 F.2d at 9. In addition,
MONTECRISTO's commercial success, as shown by widespread media
exposure and advertising expenditures, reinforces the strength of
the mark. See Charles of the Ritz Group Ltd. v. Quality King
Distributors, Inc., 832 F.2d 1317, 1321 (2d Cir. 1987)
(considering extensive advertising a factor in finding a strong
mark). Therefore, the "strength of the mark" factor weighs in
2. Degree of Similarity Between the Marks
The MCdT Defendants' trade names "Montecristi" and "Monte
Cristi" and CCB's trademark "Montecristo" and "Monte Cristo" are
very similar, weighing heavily in favor of a likelihood of
confusion. The designations are almost identical, both
phonetically and visually. See G.D. Searle & Co. v. Chas. Pfizer
& Co., 265 F.2d 385 (7th Cir. 1959), cert. denied,
361 U.S. 819, 80 S.Ct. 64, 4 L.Ed.2d 65 (1959); Generation X
International Corp. v. No Excuses Sportswear, Ltd., No. 98 Civ.
1935, 1998 WL 249177, at *20-21 (S.D.N.Y.). Although the final
letter of the MCdT Defendants' product is "i" instead of "o,"
"consumers would be `reasonably justified in believing both
products come from the same [Source].'" Nabisco Brands, Inc. v.
Arnold Kaye and Arnie's Deli, Ltd. 760 F. Supp. 25, 27 (D.Conn.
1991), quoting Harlequin Enterprises v. Gulf & Western Corp.,
644 F.2d 946, 949 (2d Cir. 1981). In the present case, the only
difference between the two names is the final letter, a scenario
analogous to that in Nabisco, in which the only difference in
the product names was the final digit ("A-1" versus "A-2" meat
sauce). In that case, the court found that such a slight
distinction "rather than differentiate the product, in fact,
increases the likelihood that consumers will believe that the
defendant's product is simply a variation on the basic `A.1.'
sauce or a line extension which emanates from, or is authorized
by or otherwise affiliated with the same source as the `A.1.'
product." Nabisco, 760 F. Supp. at 27. Similarly, the proximity
in sound and spelling of "Montecristi" to "Montecristo" is likely
to lead consumers to believe, as importer Orth did, that
defendants' MCdT cigars are affiliated with plaintiffs' products.
3. Proximity of Products
The goods involved (cigars) are identical. Therefore, this
factor weighs in plaintiffs' favor.
4. Likelihood that Senior User Will "Bridge the Gap"
Where, as here, the parties are selling identical products,
there is no gap to bridge; thus, this factor strongly favors
plaintiffs. Gucci Am., Inc. v. Action Activewear, Inc.,
759 F. Supp. 1060, 1065 (S.D.N.Y. 1991).
5. Evidence of Actual Confusion
The law does not require plaintiffs to show evidence of actual
consumer confusion. See Nabisco 760 F. Supp. at 28. However,
when such evidence does exist, it is a strong indication of the
likelihood of confusion. Giorgio Beverly Hills, Inc. v. Revlon
Consumer Products Corporation, 869 F. Supp. 176, 184 (S.D.N Y
1994). In the present case, plaintiffs have provided
evidence of actual confusion, in importer Orth's testimony
stating that the similarity of the "Monte Cristi" and
"Montecristo" names gave him a comfort and confidence level that
the MCdT cigars he was buying were in fact a genuine Montecristo
product. Thus, this factor weighs in plaintiffs' favor.
6. Junior User's Intent
Evidence that a defendant deliberately engaged in a deceptive
commercial practice, creates a presumption of consumer confusion.
Resource Developers, Inc. v. Statue of Liberty-Ellis Island
Foundation, Inc., 926 F.2d 134, 140 (2d Cir. 1991). The MCdT
Defendants (a) told Orth that they had a contract with
plaintiffs; (b) gave importer Zagarella a letter stating that
"the name of Montecristo derives from the name of the factory of
cigars Monte Cristi de Tabacos," Pls.' Rule 56.1 Statement, ¶
38(d); and (c) used the similarity between the words
"Montecristo" and "Montecristi" to convince a Washington State
importer that the products stemmed from the same source. These
actions demonstrate that the MCdT Defendants deliberately engaged
in a deceptive commercial practice, thus creating a presumption
of consumer confusion.
7. Product Quality
Where the junior user's product is inferior, the quality factor
weighs in favor of the plaintiff. Nikon v. Ikon Corp.,
987 F.2d 91, 95 (2d Cir. 1993). In the present case, the only evidence
plaintiffs offer to show the MCdT cigars' inferiority is included
in a declaration by Richard L. DiMeola, an officer with plaintiff
Consolidated for over thirteen years, stating that the MCdT
cigars "are of mediocre to poor quality and are grossly inferior
to CCB's high quality MONTECRISTO cigars." Declaration of Richard
L. Dimeola, dated June 29, 1998, ¶ 27. As the moving party in
this summary judgment motion, plaintiffs bear the burden of
production; as plaintiffs, they also have the burden of
persuasion at trial. In light of these burdens, plaintiffs'
evidence of the MCdT cigars' inferior quality is scant; however,
this paucity of evidence is inconsequential, given the strength
of the other Polaroid factors.
8. Sophistication of the Buyers
When a product's average consumer is more sophisticated,
trademark similarities are less likely to lead to confusion about
the product's source or sponsorship. Bristol-Myers Squibb Co. v.
McNeil-P.P.C. Inc., 973 F.2d 1033, 1046 (2d. Cir. 1992).
Conversely, less sophisticated consumers are more likely to be
confused by similarities among products. Cigars have grown in
popularity in recent years, attracting new consumers who lack the
sophistication required to distinguish among confusingly similar
names, thus increasing the likelihood of confusion. Therefore,
this factor weighs in plaintiffs' favor.
For the above reasons, the Court finds a strong likelihood of
confusion between plaintiffs' products and the MCdT cigars.
C. Dilution of the MONTECRISTO Trademark
Plaintiffs claim that the MCdT Defendants' use of counterfeits
of CCB's MONTECRISTO trademark and their use of Monte Cristi
Trade Names dilutes CCB's MONTECRISTO trademark in violation of
Lanham Act Section 43(c)(1), 15 U.S.C. § 1125(c)(1), ("Section
43(c)(1)") and New York's anti-dilution statute. Section 43(c)(1)
entitles the owner of a famous mark, subject to a reasonableness
review, to "an injunction against another person's commercial use
in commerce of a mark or trade name, if such use begins after the
mark has become famous and causes dilution of the distinctive
quality of the mark, and to obtain such other relief as is
provided in this subsection." New York's anti-dilution statute
Likelihood of injury to business reputation or of
dilution of the distinctive quality of a mark or
trade name shall be ground for injunctive relief in
cases of infringement of a mark registered or not
registered or in cases of unfair competition,
notwithstanding the absence of
competition between the parties or the absence of
confusion as to the source of the goods or services.
N Y Gen. Bus. Law § 368-d (repealed 1996, eff. Jan 1, 1997,
current version at N.Y. Gen. Bus. Law § 360-l (1997)).
In order to establish a dilution claim, plaintiffs must show
(1) ownership of a distinctive or famous mark, and (2) a
likelihood of dilution. See Hormel Foods Corporation, v. Jim
Henson Productions, Inc., 73 F.3d 497, 506 (2d Cir. 1996)
(quoting Sally Gee, Inc. v. Myra Hogan, Inc., 699 F.2d 621, 625
(2d Cir. 1983)).
1. Ownership of Distinctive or Famous Mark
In considering Section 43(c)(1)'s list of nonexclusive factors
for determining adequacy of a mark's fame or distinctiveness, the
courts in this District have ruled that a mark found to be
"strong" under the likelihood of confusion analysis is
sufficiently famous or distinctive to receive protection from
dilution. See Lexington Management Corp. v. Lexington Capital
Partners, 10 F. Supp.2d 271, 289 (S.D.N.Y. 1998) (finding
plaintiff's mark distinctive under Section 43(c)(1) based on
finding of strength in infringement analysis); Generation X at
27 (same). Thus, based on the finding of strength in the
likelihood of confusion analysis in Section IV(B)(1), the Court
finds that CCB's MONTECRISTO trademark qualifies as famous for
the purposes of the dilution statute.
2. Likelihood of Dilution
Under both the Lanham Act and New York state law, trademark
dilution can occur through blurring or tarnishment. See Hormel
Foods, 73 F.3d at 506. Tarnishment occurs when a trademark is
"linked to products of shoddy quality, or is portrayed in an
unwholesome or unsavory context." Deere & Co. v. MTD Prods.,
Inc., 41 F.3d 39, 43 (2d Cir. 1994). The doctrine does not apply
in the present case, where there is no allegation of
unwholesomeness or unsavoriness, and only scant evidence of the
MCdT cigars' inferiority, see Section IV(B)(7), above. Dilution
by blurring occurs when customers or prospective customers
observe the plaintiff's mark used on numerous and varied goods
and services. Id. When this happens, "the defendant uses or
modifies the plaintiff's trademark to identify the defendant's
goods and services, raising the possibility that the mark will
lose its ability to serve as a unique identifier of the
plaintiff's product." Id. (emphasis deleted) (quoting Deere &
Co. v. MTD Products., Inc., 41 F.3d 39, 43 (2d Cir. 1994)).
The blurring analysis contains five factors: (1) similarity of
the marks; (2) similarity of the products; (3) consumers'
sophistication; (4) the senior mark's renown; and (5) the junior
mark's renown. Lexington 10 F. Supp.2d at 289. The first four
factors are nearly identical to those in the Polaroid test,
which in this case weigh heavily toward a finding of blurring.
The final factor, the junior mark's renown, is significant
because obscure use of a designation will likely have only a de
minimus effect on a famous mark. In the present case, the MCdT
Defendants' use of the designation "Montecristo" and of the Monte
Cristi trade names is not obscure, because the MCdT Defendants
have placed their product in the public eye through news
articles, advertisements, and trade listings. Furthermore,
numerous importers, distributors, and retailers have trafficked
in MCdT cigars. Therefore, the MCdT Defendants' use of the
designation "Montecristo" and of the Monte Cristi Trade Names has
caused dilution by the blurring of CCB's trademark. Accordingly,
summary judgment is granted to plaintiffs on their dilution
For the foregoing reasons, the Court grants plaintiffs' motion
for summary judgment on all claims.
Settle judgment on notice.