The opinion of the court was delivered by: Nickerson, District Judge.
Plaintiff brought this action for unfair competition and trade
dress infringement under Section 43(a) of the Lanham Act,
15 U.S.C. § 1125(a), unfair competition and trade dress infringement
under New York General Business Law §§ 349, 350, and 368-d, and
injury to business reputation and trademark dilution pursuant to
state and federal common law.
Plaintiff is the maker of auto anti-theft devices that attach
to a motor vehicle's steering wheel so as to inhibit it from
moving. Plaintiff markets the devices under such trademarks as
"The Club," "The Super Club," "The Ultra Club," "The Premier
Club," and "The Club LX" (collectively "The Club"). The price tag
on The Club that plaintiff submitted to the court says $39.99.
The court has jurisdiction pursuant to 28 U.S.C. § 1338(a),
giving federal courts jurisdiction over, among other matters,
trademark cases, and 28 U.S.C. § 1338(b), providing jurisdiction
over a claim of unfair competition when joined with, among other
claims, a substantial and related trademark claim.
Plaintiff has moved for a preliminary injunction immediately to
restrain defendants from manufacturing, selling, distributing,
disseminating, and advertising Global America.
Plaintiff claims (1) Global America's trade dress, specifically
its shape, red and black color combination, and its packaging,
constitute unfair competition under the Lanham Act,
15 U.S.C. § 1125(a) and the New York General Business Law §§ 349, 350 and
368-d; (2) defendants' false and deceptive marketing practices
violate the New York General Business Law §§ 349, 350 and 368-d;
and (3) defendants' use of confusingly similar trade dress and
packaging constitute (a) unlawful dilution of the trademark "The
Club" and its trade dress, (b) unfair business practice, and (c)
false advertising pursuant to federal and New York law.
I. The Competing Products
The record shows, in substance, the following. Plaintiff is the
market leader in automobile anti-theft devices and has been
marketing The Club since April 28, 1986, advertising the device
on television, in newspapers, on radio, and in direct consumer
mailings. The Club is sold in stores nationally and
internationally, with gross sales and gross advertising expenses
exceeding $649,276,000 and $195,109,000 respectively.
The Club, as displayed in its package, consists of a metal rod
covered in vinyl, red in color, about one foot, eight and a-half
inches long but adjustable in length, with a hook attached or
molded off to the right side of the top of the device, and an
upside-down hook attached or molded off to the right side of the
middle. Just above the middle hook is a black lock mechanism,
with a "W," presumably a logo for the company's name, Winner,
emblazoned above the lock. On the side of the red rod is the "The
Club" in black letters. On the bottom of the device is a black
plastic grip with undulating grooves on the side, suggesting
finger-placement. Plaintiff says the grooved plastic grip at the
base makes the device look like a club, and hence the name.
The packaging for The Club consists of an outer clear plastic
package, a cardboard insert, and a hole at the top to hang the
product on display. The cardboard is predominantly gold, with a
black band at the top and the bottom. "The Club" is in one and
a-quarter inch lettering in gold at the top. A picture featuring
The Club in red, with "The Club" clearly visible in black
letters, attached to a steering wheel of a vehicle in
black-and-white, appears in the upper part of the front of the
The product claims on the front and back of the package are
written in English and French. Included in the written claims on
the front of the package is a white starburst at the top that
says, in red lettering, "Police Say `Use It'." Also at the top is
the slogan "Guaranteed up to $500," with $500 in bright red. In
the middle under the heading "The Club" is a list of the
• Guaranteed up to $500.00 towards deductible.
At the bottom are endorsements, in small gold lettering, from
policemen and Autotech Magazine.
The back of the package includes written instructions and
diagrams on how to use the device, along with an explanation of
the guarantee. Additionally there is a sketch of the device, with
its various features listed with arrows pointing to their
location on the device. Over the sketch it says "The Club," "The
Original . . .," and below it says "Ask For The Club By Name",
"Fully Guaranteed, Details Inside." The keys to the device are
visible on the back enclosed in clear plastic. At the very bottom
in small print appears "Winner International Corp."
Plaintiff sells The Club in color combinations other than red
and black, but ninety-percent of its sales are in the red and
black product. It is this color combination of red and black that
is chiefly at issue.
Defendants sell the Global America steering wheel lock
primarily to Strauss Auto Discount Stores and in flea markets
with total revenues of about $162,500 and an advertising
investment of about $1200. In Strauss Auto Discount Stores it
lists for $19 but is usually sold at a sales price of $10. The
Club sells at Strauss for a price of $39.99.
The general manager of Strauss says that The Club products are
sold together in their own "planogram," apparently a separate
display structure, and not grouped together with Global America
or other competing products.
Defendants' device, as displayed in its package, consists of a
metal rod covered in vinyl, red in color, about one foot, seven
inches long but adjustable in length, with a u-shaped prong
centered at the top of the device and a hook — in the shape of a
partial "u" jutting off to the right side of the middle of the
rod. Above the middle hook is a black lock mechanism. In black
letters on the red rod facing the front of the package, is the
name "Global America." On the bottom is a black plastic grip with
raised bumps. The name "Global America" is etched onto the grip,
facing the front of the package.
The packaging of Global America consists of an outer clear
plastic package, a cardboard insert, and a hole at the top to
hang the product on display. The cardboard is completely black.
The name "Global America," in dim gold, appears twice on the top
of the cardboard insert and in one and a-quarter inch lettering
sideways to the left of the device. There is a picture of a car
towards the top of the insert, with the following list of
features underneath, in English only:
• 3(4) Way Keys for High Security
• Vinyl Coated to protect against damage to car.
There is a dimly lit picture of the device on a vehicle's
steering wheel, and the keys are visible from the front of the
package enclosed in clear plastic.
The back of the package has instructions for use, in English
and French, with two small black-and-white photographs, one
showing the device fully on the steering wheel and one showing it
either half-on or half-off. The name "Global America" appears
twice at the top and twice at the bottom. "Omori Enterprises
Inc." appears in small print at the bottom.
Defendants also sell their device in color combinations other
than red and black, but admit that "they don't sell," meaning
that consumers do not prefer the product in other colors.
Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), provides,
in pertinent part, for a private cause of action against any
in connection with any goods . . . or any container
for goods, uses in commerce any word, term, name,
symbol, or device, or any combination thereof . . .
which . . . is likely to cause confusion, or to cause
mistake, or to deceive . . . as to the origin,