MANSFIELD, Circuit Judge:
In this action for unfair competition and breach of contract defendants The New Body Boutique, Inc., Maximum Exposure Advertising Inc. ("MEA"), Harvey S. Fishman, and Avram C. Freedberg appeal from a decision of the District Court for the Southern District of New York, entered by Judge Morris E. Lasker after a non-jury trial, holding that defendants, by selling a waist-reducing belt called "Shrink Wrap" in competition with a similar belt already being marketed by plaintiff Vibrant Sales, Inc. ("Vibrant"), under the name "Waist Away," violated § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a),
We reverse. Since Vibrant's Lanham Act claim alleged that defendants' actions amounted to a false designation of origin, a violation could only have been made out if it had been shown that Vibrant's "Waist Away" belt (which defendants allegedly copied) had acquired secondary meaning and that the features allegedly copied were non-functional in nature. No such finding was or could have been made. The district court's decision on the Lanham Act allegation was therefore incorrect. The district court also erred in its interpretation of the agreement on which Vibrant's contract claim was based.
In late 1978 or early 1979, Isaac Bikel, Vibrant's principal owner, began marketing a waist-reducing belt called "Waist Away" on a limited scale. This original belt, which was never patented or trademarked, consisted of a strip of thick black rubber which could be fastened around the waist by the use of a set of Velcro fasteners. In order to increase sales, Vibrant entered into a joint venture agreement with MEA on September 4, 1979. Under the terms of that agreement, MEA was to market Vibrant's Waist Away belt nationwide.
By the end of 1979 the joint venture was enjoying considerable success as a result of MEA's extensive advertising campaigns.
Soon after the Agreement was executed, defendants Fishman and Freedberg began marketing their own waist-reducing belt through a company called The New Body Boutique, Inc. The belt was called "Shrink Wrap," and was similar to the all-black belt marketed prior to the joint venture by Isaac Bikel. In response, Vibrant filed this suit on May 28, 1980.
The complaint, invoking § 43(a) of the Lanham Act, and New York common law,
The district court, finding for the plaintiff on both the Lanham Act and breach of contract claims, concluded that defendants had "violated the Lanham Act ... by advertising Shrink Wrap in a manner which falsely designates its origin." The court's finding on this point was based on several facts: (a) defendants on one occasion "used a photograph of plaintiff's belt in defendants' advertisement with the result that the advertisement has actually confused and is likely to continue to confuse the public as to the source of origin of defendants' belt"; (b) "[t]he appearance of the models in the defendants' ads is also of such striking similarity to that of the appearance in the plaintiff's ads to create a likelihood of confusing the public as to the origin of the designation of the products respectively advertised"; (c) letters from customers showed that some members of the public were actually confused about the origin of the two belts; and (d) while the all-black belt being sold by defendants was not identical in all respects to the blue belt primarily being sold by plaintiff, the differences were not visible in magazine advertisements, and in any case "there is no proof, nor even a contention that the color [or materials used] has any functional significance."
Turning to the breach of contract claim, the district court held that defendants had breached the Agreement in two respects. First, it found that defendant had marketed "[a] belt identical in all respects to the Waist-Away Belt currently being shipped by Purchaser", since the all-black belt did not differ in any material way from the blue belt. The court rejected defendants' argument that the language of the Agreement should be read literally on this point, because that would have the effect, in the court's opinion of "repeal[ing] pro tanto the public's right under the Lanham Act to be protected against false designation of origin", and because such a reading would totally eliminate "a right of protection" which the contract had been designed to confer on Vibrant.
Second, the court found that defendants had also breached the Agreement by using in their advertisements photographs of models who were similar in appearance to those used by plaintiff. The court held that the language of the Agreement prohibiting defendants from using "the likeness of the persons depicted in [plaintiff's] advertisements" did not mean that defendants were free to use any models other than those used in plaintiff's ads, but instead ruled out the use of "any persons who substantially resemble the models appearing in the Vibrant photograph." It found support for its conclusion on this point both in the language of the Agreement itself, and in the fact that any other reading would reduce the level of protection conferred by the Agreement on plaintiff while increasing the chances of confusion as to source of origin which § 43(a) was designed to prohibit.
By order dated October 9, 1980, Judge Lasker granted Vibrant broad permanent injunctive relief "without prejudice to
Section 43(a) of the Lanham Act contains two separate prohibitions: one against false designation of origin, and another against false description or representation. See Comment, The Present Scope of Recovery for Unfair Competition Violations Under Section 43(a) of the Lanham Act, 58 Neb.L.Rev. 159, 161 (1978). An action like the present one, which is predicated almost entirely on the false designation of origin leg of § 43(a), can only succeed if the features allegedly copied have acquired secondary meaning in the marketplace and are non-functional.
The requirement of proof of secondary meaning flows logically from § 43(a)'s somewhat anomalous position in the Lanham Act. As the only provision in the Act which is not limited to registered marks, 43(a) may be invoked by claimants whose unregistered marks do not possess the presumptive source association of a registered trademark. See Comment, Generic Drug Laws and Unfair Competition Claims Under the Lanham Act — An Uneasy Alliance: Ives Laboratories, Inc. v. Darby Drug Co., 33 Rut.L.Rev. 227, 237 (1980). As a result, a claimant suing under 43(a) is routinely required to show secondary meaning in order to convince the court that the defendant's copying has had the effect of communicating a "false designation of origin". As one observer has written:
The additional requirement that copied features must be non-functional if the copying is to come within the prohibition of § 43(a) reflects the concern that first-comers not be allowed to prevent the widespread use of useful but non-patentable features. As one commentator has put it:
When combined, the requirements of secondary meaning and non-functionality serve the salutary purpose of limiting § 43(a) claims to those situations in which unique or distinctive identifying features
The district court, apparently laboring in the belief that evidence of mere confusion was sufficient to justify invoking § 43(a) to support a claim of false designation of origin with respect to a product having no registered mark, overlooked or ignored the requirements of secondary meaning and non-functionality. Such a reading is incorrect and would confuse § 43(a) with § 32 of the same Act. 15 U.S.C. § 1114. The latter section, which provides the basic remedy for one whose registered mark has been copied, explicitly allows recovery based on copying which "is likely to cause confusion." By contrast, § 43(a) at not point employs the language "likely to cause confusion", and the relevant case law does not incorporate that test by analogy. See, e. g., Universal City Studios, Inc. v. Sony Corp., 429 F.Supp. 407, 409 (C.D.Cal.1977) (false representation context). The reason for the difference in treatment is clear: registered marks are presumed to represent the source in the minds of the public, whereas unregistered marks are not, absent a showing of secondary meaning.
When the proper standards for judging a § 43(a) claim are applied to the facts of this case, it is clear that plaintiff cannot prevail. Since plaintiff concededly made no attempt to adduce any evidence that its product's appearance or methods of advertising had acquired secondary meaning, its Lanham Act claim should have been dismissed. While it is therefore unnecessary for us to go on to the question of functionality, we are persuaded that plaintiff's claim should have been dismissed on that ground as well. All of the design elements cited by plaintiff as making its product unique (the particular rubber used, the Velcro fastener, the graduated sizes, the belt's alleged reversibility, and the "distinctive 3 box configuration on the front" produced by the stitching which attaches the Velcro strips to the belt) are functional and therefore subject to copying. None of the features mentioned could properly be classified as "a mere arbitrary embellishment ... adopted for purposes of identification and individuality," Pagliero v. Wallace China Co., 198 F.2d 339, 343 (9th Cir. 1952). They are therefore beyond the scope of the protection which § 43(a) affords.
On this appeal plaintiff argues that since the district court found that defendants used a photograph of plaintiff's belt in one of their ads it must prevail on its § 43(a) claim, because "[i]t is by now hornbook law that Section 43(a) is violated when a party attempts to market a product by use of a photograph of the product of another." Although such conduct may give rise to liability, it is not automatic. One who uses a photograph of his competitor's unpatented and untrademarked product to advertise his own wares may be guilty of false representation if the product pictured is not identical to the one he is prepared to deliver. This was central to the Third Circuit's seminal decision in L'Aiglon Apparel, Inc. v. Lana Lobell, Inc., 214 F.2d 649 (3d Cir. 1954), where the defendant made use of a picture of the plaintiff's $17.95 dress to advertise its own inferior $6.95 dress. Second, he may be vulnerable to a charge of false designation of origin if the features pictured in the photograph are non-functional and have acquired the secondary meaning necessary to indicate origin to the typical consumer. See, e. g., Crossbow, Inc. v. Dan-Dee Imports, Inc., 266 F.Supp. 335 (S.D.N.Y.1967), where the defendant carefully copied the plaintiff's popular signal light and, because of its distinctively novel design, its copies were widely believed to have been made by the same manufacturer as the heavily advertised original.
On the facts of this case, defendants cannot be said to have committed either sin. Unlike the dressmaker in L'Aiglon, defendants admittedly shipped exactly what they depicted in their ads. See Mastro Plastics Corp. v. Emenee Industries, Inc., 16 A.D.2d 420, 228 N.Y.S.2d 514 (1st Dep't 1962); George O'Day Associates, Inc. v. Talman Corp., 206 F.Supp. 297 (D.R.I.), aff'd, 310 F.2d 623 (1st Cir. 1962), cert. denied, 372 U.S. 977, 83 S.Ct. 1112, 10 L.Ed.2d 142 (1963). And, unlike the copier of novelty
To the extent that some of the language in Matsushita Electric Corp. v. Solar Sound Systems, Inc., 381 F.Supp. 64 (S.D.N.Y.1974), can be read to look the other way, we do not choose to approve it. We also note that there, as in L'Aiglon, the copied product was inferior to the original, which is not the case here.
We next move to plaintiff's breach of contract claim, which turns on the interpretation to be given to the earlier-quoted provisions of the Termination Agreement. At the outset, since defendants did not violate the Lanham Act by selling a belt which consumers might have difficulty distinguishing from plaintiff's original belt, the court's concern that a straightforward interpretation of the Agreement would repeal pro tanto "the public's right under the Lanham Act to be protected against false designation of origin" is unfounded. When the Agreement is examined within its four corners, free from any concern that Lanham Act protection must be "saved", the lower court's reading becomes untenable. The Agreement clearly grants to defendants the right to market a waist-reducing belt in the future as long as it is not "identical in all respects" with the Waist Away being shipped on March 31, 1980.
Even a casual examination of the two belts demonstrates that they are not identical in all respects, and in fact differ substantially in appearance, texture, and construction. No persuasive reason is offered for reading the plain language of the Agreement differently. Judge Lasker's contrary result was based in part on his concern that plaintiff not be left without any protection at all against future competition from defendants, since "[t]he contract clearly purports to confer a right of protection on Vibrant." Here we must disagree. There is no evidence that the freedom-to-compete clause was designed only to protect Vibrant.
Finally, we reject the district court's reading of the freedom-to-compete provision as barring defendants' use of models similar in appearance to those used by plaintiff. With all respect, we have difficulty seeing how the clause
can be read to apply to persons other than those depicted in Exhibit B. In any case, our reading finds strong independent support in defendants' uncontested assertion that during the negotiations leading up to the signing of the Agreement a request was made that photographs depicting additional couples be added to the one already included in Exhibit B, and that the request was rejected. In the light of all these circumstances, we are convinced that defendants' use of a photograph depicting a couple similar in appearance to the one used by plaintiff did not breach the Agreement.
The order of the district court is reversed.