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Guccei America, Inc. v. Guess?

February 14, 2012


The opinion of the court was delivered by: Shira A. Scheindlin, U.S.D.J.



Gucci America, Inc. ("Gucci") brings this action against Guess?, Inc., Marc Fisher Footwear LLC ("MGG"), the Max Leather Group/Cipriani Accessories, Inc., Sequel AG, K&M Associates L.P., Viva Optique, Inc., Signal Products, Inc, and Swank, Inc. (collectively, "Guess"), alleging various violations of the Lanham Act and New York state law.*fn1 Guess now moves for summary judgment. MFF has filed a similar motion with respect to Gucci's claims against it. For the reasons stated below, the motions are denied in part and granted in part.


This dispute began in 2009, when Gucci sued Guess, stating that it

engaged in "a sophisticated and elaborate scheme . . . to target Gucci, to create products that are similar in appearance to the most popular and best-known Gucci products, and trade upon the goodwill and reputation associated with Gucci and its high-quality, distinctive product lines." Proceeding under both federal and state law, Gucci seeks a permanent injunction preventing Guess from using the allegedly infringing marks, monetary relief (including actual damages, statutory damages, and an accounting of profits) and destruction of all allegedly infringing products on the basis of the following claims: 1) a trademark counterfeiting claim based on Guess's use of Gucci's Green-Red-Green Stripe ("GRG Stripe") design; 2) a trademark infringement claim based on Guess's use of the GRG Stripe, Script Guess, and Square G designs, as well as a related trade dress infringement claim based on Guess's use of the Quattro G design;*fn3 and 4) claims for dilution, false designation of origin, and unfair competition based on Guess's use of all four designs. Gucci also seeks cancellation of Guess's "4G Square Repeating Logo" trademark on the basis of abandonment.*fn4 Guess timely denied all of Gucci's claims, and approximately six months after the Complaint was filed, suggested that this dispute was amenable to summary disposition.*fn5 Nonetheless, the parties conducted full-scale discovery and engaged in settlement negotiations.

At a hearing on June 6, 2011, Guess persisted in its view that it was entitled to summary judgment. Nonetheless, I directed the parties to separate the Daubert expert-exclusion process from the summary judgment process, hoping that the decision on these motions would eliminate the need for summary judgment motions, or at least significantly reduce the scope of such motions.*fn6

Thereafter, this Court excluded all of Guess's confusion surveys as irrelevant to the issue of post-sale confusion. One of these -- the Scott Survey -- was nonetheless admitted on the issue of laches.*fn7 Gucci's confusion survey was ultimately admitted for certain limited purposes,*fn8 while its dilution survey was admitted in its entirety.*fn9

Although Guess previously stated that its summary judgment motion would "rely largely on [the confusion] surveys,"*fn10 it was not deterred by their exclusion or by this Court's frequent warnings that many of the issues in this case were inherently fact intensive and not amenable to summary judgment. Accordingly, Guess's counsel has now brought the motion that it could not waive "in good conscience."*fn11 A careful consideration of the voluminous submissions with which the parties have inundated this Court confirms that large portions of these motions were -- as predicted -- not amenable to summary disposition.*fn12 With few exceptions, the motions are denied.


A. Summary Judgment

1. General Standards

Summary judgment is appropriate "if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law."*fn13 "'An issue of fact is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. A fact is material if it might affect the outcome of the suit under the governing law.'"*fn14 "[T]he burden of demonstrating that no material fact exists lies with the moving party . . . ."*fn15

"When the burden of proof at trial would fall on the nonmoving party, it ordinarily is sufficient for the movant to point to a lack of evidence to go to the trier of fact on an essential element of the non[-]movant's claim."*fn16

To defeat a motion for summary judgment, the non-moving party must raise a genuine issue of material fact.*fn17 The non-moving party must do more than show that there is "'some metaphysical doubt as to the material facts,'"*fn18 and it "'may not rely on conclusory allegations or unsubstantiated speculation.'"*fn19

However, "'all that is required [from a non-moving party] is that sufficient evidence supporting the claimed factual dispute be shown to require a jury or judge to resolve the parties' differing versions of the truth at trial.'"*fn20

In determining whether a genuine issue of material fact exists, the court must "constru[e] the evidence in the light most favorable to the non-moving party and draw all reasonable inferences" in that party's favor.*fn21 However, "'only admissible evidence need be considered by the trial court in ruling on a motion for summary judgment.'"*fn22 "'Credibility assessments, choices between conflicting versions of the events, and the weighing of evidence are matters for the jury, not for the court on a motion for summary judgment.'"*fn23 Summary judgment is therefore "appropriate only if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law."*fn24

2. Expert Reports

"Entirely conclusory" expert reports are not sufficient to ward off summary judgment.*fn25 Indeed, even a non-conclusory expert report may not be "a talisman against summary judgment."*fn26 It does not follow, however, that an expert report is never sufficient to defeat summary judgment. Instead, deciding whether an expert report raises a genuine issue of material fact is a task left to the sound discretion of the court.*fn27 In cases where credible expert reports conflict the case for summary judgment on the disputed issue is very weak.*fn28

B. Post-Sale Confusion*fn29

The Second Circuit has recognized a claim for post-sale confusion for more than fifty years.*fn30 This type of confusion harms the owner of a trademark in that a potential purchaser, knowing that the public is likely to be confused or deceived by the allegedly infringing product, will choose to purchase that product instead of a genuine one in order to gain the same prestige at a lower price.*fn31

While courts have long recognized that the Lanham Act only protects against confusion that affects purchasing decisions,*fn32 the Second Circuit has never required a trademark owner proceeding under a post-sale theory of confusion to show that sales were actually lost to the allegedly infringing user, as such evidence is not easily obtained. Instead, the Second Circuit has held that post-sale confusion is actionable when members of the public are confused as to the origin of the products,*fn33 as the existence of such confusion is precisely what would lead a potential purchaser to choose the cheaper infringing product over the more expensive genuine article.
Accordingly, instead of focusing on whether any sales were actually diverted, courts in the Second Circuit look at all of the traditional Polaroid factors in analyzing claims of post-sale confusion.*fn34 Such factors include (1) the strength of plaintiff's mark; (2) the similarity of plaintiff's and defendant's marks; (3) the proximity of the products; (4) the likelihood that plaintiff will "bridge the gap"; (5) actual confusion between products; (6) defendant's good or bad faith in adopting the mark; (7) the quality of defendant's product; and (8) the sophistication of the buyers.*fn35 "No single factor is dispositive, nor is a court limited to consideration of only these factors."*fn36 "Further, 'each factor must be evaluated in the context of how it bears on the ultimate question of likelihood of confusion as to the source of the product.'"*fn37

C. Monetary Relief

In order to obtain monetary relief for damages stemming from trademark infringement, the owner of a trademark normally must prove "actual consumer confusion or deception resulting from the violation [of the Lanham Act]."*fn38 Damages may include lost sales,*fn39 a reasonable royalty*fn40 , and harm to brand value.*fn41 In the absence of such a showing, the owner may nonetheless obtain monetary relief by proving that the alleged infringer acted with an intent to deceive, because such an intent gives rise to a rebuttable presumption of actual confusion.*fn42 While an intent to copy ...

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