MARKEY, Chief Judge.
This is an appeal from the ruling of the district court granting appellees' (Restaurant's)
Distiller is the owner of three trademark registrations for gin, each alleging first use on November 11, 1909. The registrations are for the term "BEEFEATER";
During the period 1953 through 1974, Distiller's national retail sales, including those in restaurants, totaled nearly a billion dollars. From 1955 to 1974 Distiller's promotional expenditures, involving newspapers, magazines, and billboards, totaled nearly thirty-two million dollars.
Restaurant's predecessors, John F. Joliat and Robert E. LaJoie, commenced a restaurant operation in a suburb of Detroit, Michigan in 1957, adopting, with prior knowledge of Distiller's BEEFEATER mark, the notation SIGN OF THE BEEFEATER for their restaurant. As currently employed and as involved in this action, Restaurant's mark comprises the phrase SIGN OF THE BEEFEATER displayed in connection with the face of a fat hungry man. The man is shown as wearing a three-cornered hat, holding a knife and fork in his hands, and having a bib about his neck. The following is a typical outdoor sign employed by Restaurant.
In 1959 and 1960, Distiller objected to Joliat and LaJoie's use of BEEFEATER.
Distiller's opposition was based on the ground that SIGN OF THE BEEFEATER so resembled its registered trademark BEEFEATER as to be likely to cause confusion, mistake or deception. The Trademark Trial and Appeal Board (TTAB) of the Patent
In February, 1972, Joliat and LaJoie assigned their rights in the contested mark to a corporation styled "Sign of the Beefeater, Inc." In the same year that corporation was, by mesne assignments, acquired by defendant Ward.
In 1973, Restaurant filed an application to register the mark involved in this action. Distiller's opposition
Restaurant expanded its operations to the Chicago, Illinois metropolitan area in 1975.
Upon completion of Distiller's case, Restaurant moved for a directed verdict under Fed.R.Civ.P. 41(b) for failure of Distiller to establish a right to relief. The District Court, indicating that it had taken detailed notes and that it considered the issues "not too complex," dispensed with oral argument from either side and retired to chambers to consider the motion. Returning to the bench, the court granted the motion, stating its findings and conclusions orally for the record. The findings and conclusions of the District Court material on this appeal are:
Whether the district court erred in directing a verdict for Restaurant.
Under Fed.R.Civ.P. 41(b), a court may order involuntary dismissal upon completion of plaintiff's evidence-in-chief if it determines that plaintiff has "shown no right to relief." Hence we are required to review "upon the facts and the law," the sufficiency of Distiller's evidence. Recognizing that the district court weighed the evidence before it, treating no one factor as determinative, we are nonetheless convinced that Distiller's evidence on the entire record was such as to have required denial of Restaurant's motion.
There being no dispute regarding the relevant facts and no need for resolution of conflicts in testimony, the otherwise salutory third sentence of Fed.R.Civ.P. 52(a) is not applicable. Tisch Hotels, Inc. v. Americana Inn, Inc., 350 F.2d 609 (CA 7, 1965); J. B. Williams Co., Inc. v. Le Conte Cosmetics, Inc., 523 F.2d 187, 189 USPQ 10 (CA 9, 1975). In determining whether the marks involved were similar in contemplation of the law, this court is as capable as was the district court of determining whether Distiller's evidence, as a matter of law, was sufficient to establish a right to relief. See Union Carbide Corp. v. Ever-ready, Inc., 531 F.2d 366, 188 USPQ 623 (CA 7 1976). Though the determination of likelihood of confusion has been termed a finding of fact, Coca Cola Co. v. Snow Crest Beverages, Inc., 162 F.2d 280 (CA 1 1947), that ultimate question has been held reviewable on appeal. La Touraine Coffee Co. v. Lorraine Coffee Co., Inc., 157 F.2d 115 (CA 2 1946). In all events, to the extent that the ultimate finding below of no likelihood of confusion be considered a finding of fact, we consider it to have been on this record clearly erroneous.
The evidentiary effect of Distiller's federal trademark registrations is set forth in section 33(a) of the Lanham Act, 15 U.S.C. § 1115(a):
Distiller's cause of action for trademark infringement arises under the Lanham Act. Section 32(1) of that Act, 15 U.S.C. § 1114(1), defines trademark infringement in these terms:
Basis of Decision
As this court stated in G. D. Searle & Co. v. Chas. Pfizer & Co., 265 F.2d 385 (CA 7 1959), "* * * the test under the statute, 15 U.S.C.A. § 1114(1), is likelihood of confusion." Illinois law mandates application of the same test. Independent Nail and Packing Co. v. Stronghold Screw Prods., Inc., 205 F.2d 921 (CA 7 1953). In the consideration of evidence relating to trademark infringement, therefore, a court must expand the more frequent, one-on-one, contest-between-two sides, approach. A third party, the consuming public, is present and its interests are paramount. Hence infringement is found when the evidence indicates a likelihood of confusion, deception or mistake on the part of the consuming public. Infringement does not exist, though the marks be identical and the goods very similar, when the evidence indicates no such likelihood. See In re E. I. duPont deNemours & Co., 476 F.2d 1357, 177 USPQ 563 (CCPA 1973). When equitable considerations impel the continuation of otherwise confusing trademark uses, courts will fashion appropriate relief, often requiring notices designed to limit or defeat confusion of the public. Everest & Jennings, Inc. v. E & J Manufacturing Company, 263 F.2d 254, 120 USPQ 247 (CA 9 1958); Jewel Tea Co., Inc. v. Kraus, 187 F.2d 278, 88 USPQ 507 (CA 7 1951).
As has been said, "people do not confuse trademarks—trademarks confuse people." In re West Point-Pepperrell, Inc., 468 F.2d 200, 175 USPQ 558 (CCPA 1972); Columbian Steel Tank Company v. Union Tank and Supply Company, 277 F.2d 192, 125 USPQ 406 (CCPA 1960).
The statement of findings below twice includes a finding of no trademark infringement, followed by a separate finding of no likelihood of confusion. But the concepts are inseparable.
A "trademark" is not that which is infringed. What is infringed is the right of the public to be free of confusion and the synonymous right of a trademark owner to control his product's reputation. Thus Distiller's evidence must be evaluated on the basis of whether it disclosed a likelihood that consumers generally familiar with Distiller's marks would be likely, upon seeing only Restaurant's sign, to believe that Restaurant's enterprise was in some way related to, or connected or affiliated with, or sponsored by, Distiller. If so, a right to relief for trademark infringement has been shown.
As is common in trademark infringement suits, Distiller emphasized similarities in its label and the accused sign and Restaurant emphasized dissimilarities therein. It is of course proper to consider similarities and dissimilarities between the marks in their entireties as one element in determining likelihood of confusion. But the comparison is not that involved in testing for copyright infringement. Though the marks must be compared, they must be compared in the light of what occurs in the marketplace, not in the courtroom.
Hence it was error below to have evaluated Distiller's evidence on the basis of judicial comparison of Distiller's label and Restaurant's sign. Side-by-side comparison is not the test. Sterling Drug, Inc. v. Lincoln Laboratories, Inc., 322 F.2d 968 (CA 7 1963). The consuming public is unlikely ever to be presented with the opportunity for such comparison. As the court said in Colburn v. Puritan Mills, 108 F.2d 377 (CA 8 1950), "* * * We are to determine * * * the purchasing public's state of mind when confronted by somewhat similar trademarks singly presented * * *."
Restaurant's sign is designed and placed to catch the eye of passing motorists and pedestrians as they move about in the marketplace. The sign must therefore be evaluated on the basis of its likely effect upon consumers who do not have Distiller's label before them, but who may have a general, vague, or even hazy, impression or recollection of Distiller's marks such as may trigger a belief that a relation exists between Distiller and the enterprise identified by the sign. Northam Warren Corp. v. Universal Cosmetic Co., 18 F.2d 774 (CA 7 1927). The district court did refer to "anyone seeing the Sign of the Beefeater outside a restaurant," but held that such person would not confuse the sign with "the traditional mark or legend or Yeoman" who appears on the Beefeater gin labels. As above indicated, however, the test is not whether the public would confuse the marks, but whether the viewer of an accused mark would be likely to associate the product or service with which it is connected with the source of products or services with which an earlier mark is connected.
It was likewise error below to postulate a requirement that Distiller suffer "economic disadvantage" or that Restaurant's use of its sign be "economically harmful" to Distiller. Though, as the district court recognized, trademark infringement must be considered in a marketplace context, the test, likelihood of confusion of consumers, does not require that the contending parties before the court be even in competition. Interested businessmen may sue for trademark infringement in the course of protecting their pocketbook. But it is one of the geniuses of what has been called the "free enterprise" system (but which, in its proper operation, might be better described as "consumer-choice" system) that the interests of the consuming public and of the entrepreneur are to the maximum extent paralleled. Thus the public need not rely wholly on government for protection against confusion, and need not pay the taxes such reliance would entail.
The Fame of Distiller's Mark
Distiller's reliance on and comingling of all three of its registered marks appears to have contributed substantially to the approach taken by the district court. The court's opinion mentioned Distiller's primary mark, the term BEEFEATER, in a single sentence, "The heart of the controversy, I suppose, lies in the word Beefeater itself and the relation that the public had to it." The court did not again advert to the effect of Restaurant's incorporation of the entirety of Distiller's primary mark in the accused sign. Nor did the court refer to the uncontested, record-established facts that the public asks for Distiller's product by the term BEEFEATER and that Restaurant's restaurants are referred to by the public and by Restaurant as BEEFEATER restaurants. As we said in Union Carbide Corp., supra, "The court did not err in considering the mark as a whole but failed to give sufficient weight to the predominant feature of the marks, the words `ever ready.'"
That Distiller's mark BEEFEATER is famous and celebrated throughout the United States is uncontested. Distiller argues that because its mark is thus "strong," it is deserving of a broad scope of protection. Though Distiller cites authorities so stating, the phrase "breadth of protection" is but shorthand reference to the more fundamental, and more appropriate consideration. The trademark laws exist not to "protect" trademarks, but, as above indicated, to protect the consuming public from confusion, concomitantly protecting the trademark owner's right to a non-confused public.
Though Distiller's mark is indeed strong,
Hence the fame of Distiller's mark BEEFEATER precludes limitation of its effect in the marketplace to merely a trademark for gin and renders erroneous the district court's finding "that the registered word Beefeater gives plaintiff an exclusivity in the use of that word limited in its
The fame of Distiller's mark BEEFEATER creates the opportunity for others to ride on the goodwill of Distiller in the effort to attract consumers to goods and services which may be thought by consumers to be in some way associated with Distiller.
The effect of Restaurant's use of BEEFEATER and of the commercial magnetism of that term was evidenced below by Distiller's survey.
Distiller's survey comprised a face-to-face interview of 500 heads-of-household alternatively interviewed according to sex. The survey was conducted within a five mile radius of a proposed SIGN OF THE BEEFEATER restaurant in the Chicago, Illinois metropolitan area during August, 1975. The respondents were selected by a complex probability sampling procedure. Each respondent was initially confronted with this announcement:
Subsequently, an experienced female interviewer, who had not been made aware of the purpose of the survey, asked, inter alia, the following questions:
The recorded verbatim responses to those questions were verified by reinterviewing 70.6% of those interviewed. Eight interviews were eliminated from the survey, and the responses were tabulated using 492 interviews.
The tabulation showed that 74 respondents (15%) responded with "Beefeater gin" (61 respondents) or "Beefeater" and another liquor-related product or service (13 respondents). An additional 37 respondents (7½%) did not say "Beefeater" but did mention gin or other liquor-related product or service.
The record, as it now stands, establishes the consumer survey herein to have been fairly and scientifically conducted by qualified experts and impartial interviewers. The respondents within the five mile radius of the announcement appear to have represented a relevant portion of the consuming public. The questions, upon which the results are based, do not appear slanted or leading. The verbatim recording of the responses would appear to have negated a biased interpretation in recordation. The district court expressed no criticism of or findings on the validity of the survey itself.
After finding that 15% of the survey respondents referred to Beefeater liquor and another 7.5% referred to liquor of some type, when shown the accused sign and asked who the restaurant sponsor was, the district court found that the survey demonstrated
Our difficulty, however, with the district court's conclusion respecting the survey herein is fourfold. We cannot agree that 15% is "small." Though the percentage of likely confusion required may vary from case to case, we cannot consider 15%, in the context of this case, involving the entire restaurant-going community, to be de minimus.
In the absence of contrary evidence, therefore, it must be presumed that at least 15% of the restaurant-going public, upon seeing the accused sign, would mistakenly believe that Distiller is "sponsoring or promoting" the restaurant identified by that sign. That mistaken belief evidences a likelihood of confusion, deception, or mistake regarding the sponsorship of Restaurant's services sufficient on this record to establish Distiller's right to relief.
The judgment of the district court is reversed and the cause is remanded for further proceedings not inconsistent with the foregoing opinion.
Restaurant's arguments devoted to the fact that "Beefeater" is a dictionary term, and merely describes one who eats beef, are ineffective where, as here, the mark is clearly arbitrary and distinctive as applied to Distiller's goods and has achieved the fame established in the record before us. See Tisch Hotels, supra.