United States District Court, S.D. New York
OPINION & ORDER
L. STANTON U.S.D.J.
North America, Inc. ("Diageo") moves, pursuant to
Federal Rule of Civil Procedure 12(b)(6), for dismissal of
the second, third, and fourth counterclaims pleaded by
Deutsch Family Wine & Spirits, and Bardstown Barrel
Selections LLC (collectively, "Deutsch").
following reasons, the motions are denied.
plaintiff/counterclaim-defendant is Diageo, the owner of the
Bulleit brand family of whiskeys. Diageo has registered the
trade dress of Bulleit bottles, Reg. No. 3, 075, 812. The
defendant/counterclaim-plaintiff is Deutsch, a direct
competitor of Diageo and owner of the Redemption brand family
6, 2017, Diageo filed its first complaint against Deutsch,
alleging trademark and trade dress infringement, unfair
competition, and trademark dilution by Deutsch's
Redemption bottle and label design. The complaint claims that
"the Bulleit Design Mark and Trade Dress are inherently
distinctive and nonfunctional, and have come to be associated
exclusively with Diageo and identifying the source of
Diageo's products." (Compl. ¶ 14). It includes
a side-by-side picture of a Redemption bottle and a Bulleit
bottle, to illustrate Diageo's claim that the overall
appearance of the Redemption bottles is strikingly similar to
the Bulleit bottles. (Id. ¶ 27).
Defendants' revised product packaging incorporates the
distinctive, non-functional elements of the Bulleit Design
Mark and Trade Dress, including: (a) clear canteen-shaped
glass bottle with rounded shoulders; (b) embossed brand name
above the label; (c) arched text in the top line of the
embossed brand name; (d) convex text divider between
components of the embossed brand name (e.g.
"REDEMPTION" separated from "WHISKEY
REVIVAL"); (e) arrow-shaped text divider on the label;
(f) border of parallel lines on the label; and (g) cork
bottle cap with black top.
(Id. ¶ 26) .
filed an answer and counterclaims. (Doc. No. 19). Diageo
moved to dismiss Deutsch's counterclaims. (Doc. No. 27).
Deutsch then filed an amended answer and counterclaims,
alleging four counterclaims seeking: (i) declaratory judgment
of non-infringement and invalidity, (ii) cancellation of
Diageo's registration on the ground that its bottle shape
is unprotectable as being functional, (iii) cancellation of
the same registration on the ground it had been abandoned,
and (iv) its cancellation on the ground of fraud. (Doc. No.
34). Diageo moved again to dismiss the second, third, and
fourth counterclaims. (Doc. No. 35). Diageo's motions to
dismiss are the motions at issue here.
Trademark Act sets forth the grounds for cancellation of an
otherwise incontestable trademark: "At any time if the
registered mark becomes the generic name for the goods or
services, or a portion thereof, for which it is registered,
or is functional, or has been abandoned, or its registration
was obtained fraudulently." 15 U.S.C. § 1064(3).
These challenges are equally applicable to each of the
original and amended set of counterclaims, and the following
analysis applies equally to both.
product's trade dress must be assessed under what has
been called the anti-dissection rule, which means it must be
appraised "as a whole, not from its elements separated
and considered in detail." Estate of P.P. Beckwith,
Inc. Comm'r of Patents, 252 U.S. 538, 545-46 (1920).
The focus must be on the combination of the product's
elements, not "dissected" one by one. See
Jeffrey Milstein, Inc. v. Greger, Lawlor, Roth, Inc., 58
F.3d 27, 32 (2d Cir. 1995) ("Although each element of a
trade dress individually might not be inherently distinctive,
it is the combination of elements that should be the focus of
the distinctiveness inquiry.").
claimed trade dress is "essential" if it is
"dictated by the functions to be performed by the
article." ChristianLouboutin S.A. v. Yves
Saint Laurent Am. Holdings, Inc., 696 F.3d 206, 219 (2d
Cir. 2012) (quoting Inwood Labs., Inc. v. Ives Labs.,
Inc., 456 U.S. 844, 850 n.10 (1982)). A feature which
affects the cost or quality by permitting "the article
to be manufactured at a lower cost" or constituting
"an improvement in the operation of the goods" is