Greetings, Court fans!
 
The Court issued only one opinion yesterday, unanimously reversing a Ninth Circuit decision that held that a trademark defendant asserting the affirmative defense of “fair use” has the burden of proving that its actions are not likely to cause consumer confusion. The case, KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 03-409, 543 U.S. __ (2004), involved two companies that sell permanent makeup (the power to improve upon nature in an injectable liquid). KP had been using the term “microcolor” to describe its products since the early 1990s. Lasting Impressions, however, had registered the mark “micro-color” (in white letters separated by a green bar within a black square) in 1993 and the mark had become incontestable in 1999. Lasting Impressions filed suit against KP, claiming that KP’s use of “microcolor” infringed its stylized “micro-color” trademark. KP argued, however, that its use was merely descriptive of the product and thus qualified as “fair use” under the Lanham act. The district court agreed and granted KP’s motion for summary judgment. On appeal, the Ninth Circuit reversed, finding that KP also had to negate the possibility that its use of the term “microcolor” would cause consumer confusion. Lest you think this is another case of the “Ninth Circuit” rule, the Ninth Circuit was in the good company of the Fifth and Sixth Circuits, which also required defendants asserting “fair use” to prove no likelihood of confusion. (The Second, Fourth and Seventh Circuits had come out the other way.)
 
In an opinion authored by Justice Souter, the Court unanimously reversed, finding that a defendant in a trademark case did not bear the burden of negating the likelihood of confusion in order to prevail on a “fair use” defense. The burden of proving likelihood of confusion always has rested with the plaintiff. Thus, since the affirmative defense should come into play only once plaintiff has met its burden of establishing the likely confusion, the Court found that it would “def[y] logic to argue that [the] defense may not be asserted in the only situation where it becomes relevant.” The Court also emphasized the “undesirability of allowing anyone to obtain a complete monopoly on use of a descriptive term simply by grabbing it first.” Thus, it is now clear that some confusion must be tolerated where a trademark defendant’s use is “fair.” However, the Court did not go so far as to hold that likelihood of confusion was irrelevant to a determination of “fair use,” leaving that issue for another day. The opinion conspicuously notes that Justice Scalia, while joining almost the entirety of the opinion, declined to join footnotes 4 and 5, which examine legislative history (particularly the testimony of witnesses before Congress), and that Justice Breyer declined to join footnote 6, which suggests (apparently wrongly, to Justice Breyer) that the “fair use” analysis of KP’s use of “microcolor” on its most recent brochures might differ from that of its use on its older bottles and flyers.
 

That’s it for this week (absent an unusual turn of events). Thanks, as always, for reading!

 

Kim & Ken

 

From the Appellate Practice Group at Wiggin and Dana. For more information, contact Kim Rinehart, Ken Heath , Aaron Bayer, or Jeff Babbin at 203-498-4400