seat just for a minute because the the two cases are at least as cold or somewhat intertwined and that at least appears to this judge a little confusing lisa let me lay out for you for how we'd like to handle it if it if damages creative says that you shouldn't prevail at all or if you did you shouldn't get as much money premium says we should have gotten even more money so can we handle those claims that way as appeal across appeal and then we'll worry about the balloon ceiling attorney's fees separate after we do we go through that back and forth does that seem plausible the license that's is that the what i called the balloon oh you know that comes into that i just said that the part about the balloon ceiling is different the way it's called some of the price or roge in claims or allegedly in the second one and i want to get all the money or the money and liability having to do with the trade dress in the first round so the pellet creative you think that should have been any any damages or if there were there should be less so you start off with the appeal will hear the hear their side and on your side if you want any rebuttal time on your cross appeal then it's going to be limited strictly to your cross appeal part ok for wanting more of unregistered gray dress and a heavy weight star shaped balloon weight and this star shaped balloon weight is sold in connection with helium balloons particularly helium balloons decorated with stars and acts as a counterweight to the helium so that the balloon is inker the district court granted summary judgment in premium balloon accessories who i'm going to refer to as p v a is summary judgment in p p s favor and found that the product configuration trade dress in a star shape was protectable and issued a permanent injunction against creative by its ruling the district court granted to p v a a perpetual monopoly in a commonplace generic star shaped using the lanham act no a has not asserted that it owns a patent on the star shape and it p v a does not assert here that it any copyright registration on the star shape it is the province of the copyright law and patent law to prevent copying of products and those laws unlike the rolling by the district court provide only a limited time of exclusivity whereas the finding by the district court would give the premium a perpetual monopoly now it's are the same size the shape is symmetrical and in the balloon industry balloons are decorated with stars so the weights are store shaped  or fanciful in shape it's a commonplace star regarded by the public as a la the tory symbol demonstrating quality rank or achievement well am i right that in terms of this star as opposed to the one that had been made earlier and that clearly was included in the preview of some of the differences that it's quicker and therefore heavier that's correct yes that that's the main difference there are some minor ones as far as the loop has to be bigger to be able to tie on bouquets of balloons but for the most part that is the difference  well had was marked with the superstar trademark of creative which is a registered trademark with the u s patent and trademark office and so it differs in that respect as well from the eight gram balloon weight that was the subject of the one nine hundred ninety nine agreement you know and with respect to the other parts of the settlement agreement where it says that the quality of the products made by creative is at least consistent with the quality of the products presently being made by creative would that of have satisfied that part of the settlement agreement i'm not sure i'm following well you had a settlement agreement where you got a license to make stars saying such license to continue so long as the quality of the products made by creative is at least consistent with the quality of the products presently being made is there any question that the quality wasn't similar no none at all in fact there's no evidence in the record that t balloon weight was of less quality than the eight render agreement goes on to say and provided that the appearance is not modified to be closer in appearance to the corresponding products so is that also satisfied that you didn't modify it in some way to make it look even more like theirs we would say it is your honor because we marked it with the superstar trademark with she is a registered trademark  we're trying to pass it off as their products no absolutely not and that the market was the star shape is also marked with our house mark on the back in the children carrying the balloon  s star is nothing more than the basic form of the star shape it's generic and it's on protectable no designer should have a monopoly on designs regarded by the public is the basic form of a particular item and that lot comes from this court's case in abercrombie so it's our position your honour's that that star shape is we just employ sort of commonsense observation of that or is there evidence to that effect how do we how do you persuade us that that it's generic well it's  generic we submitted as part of our record different star shapes made by other manufacturers to be sold in connection with a loon's and it's generic because it's just a star shape and it's the basic form of a star and it's our opinion that based on the industry here and and commonsense frankly still see stars everywhere this looks like a star and really that's why we're saying it's generic evidence from their side that their star had acquired secondary meaning they say there is your honor and let me go through them very briefly what that evidence is they do not have any consumer survey evidence there is one declaration from one of their customers say they have about fifty they have one declaration from a customer this customer was not disclosed during fact discovery and we did ask the court to strike that declaration that request was denied  this customer filled in a form declaration and signed it and said oh my customers recognize this star and the native premium i thought that that declarations didn't even say the customers said i was a star it seems to be phrased a little more obliquely saying they asked for and then they filled in the technical the right you're right you're correct you're on now are those technical specifications to find out whether that really makes any difference are those technical specifications for the heavyweight p v a star any different t specifications for the heavyweight creative stuff or well we would argue they are because part of those tech technical specification is the overall appearance of the star and their star and speak to overall appearance configuration and ours is different from the standpoint that we do not have a bouquet strap on on our star that that's the big difference there between the two products and that bouquet strap is functional in that us balloon customers by description including the features making up its overall appearance such as size your size is the same in that it's heavier weight or mass years heavier yes ours is in figuration council you know if you want to save your rebuttal on this round your time's expired ok thank you here's our product here's their product there's no bouquet strap on this product the big case traps on some of them not all of them we have  trade dress in the appearance of the brain that is as to the size shape weight configuration primary colors texture this isn't the first time we've been involved in litigation with the with these people and usually battle the previous litigation saying that they would be able to make stars known th trade dress that was at issue in that litigation in the trade dress that was in that litigation was very specifically defined there were full work types and there was a teddy bear or a hard to smile face and whatever they were they were eight gram weights there were two heavyweights we settled on the trade dress that was in that case when you read the complaint that was settled by that settlement that doesn't the subtle want to greenmount say the trade dress that was the subject of the complaint namely star smiley face heart and teddy bear and it says the trade dress that was the subject of the complaint that it's and when you well it you write in it saying and it was in these four configurations but the what was at issue in the complaint the trade dress in the complaint was specifically defined as  hearts that this isn't what we had what we have is somebody who knocks us off they wait until we've sold seven million  seven million over a ten year period where mr isaacson his declaration said people came in and they did ask for that star by its description and he said the extend the customer declaration that we were at issue earlier bet is correct that is correct but am i right that the difference between the stars that were being argued about earlier and the heavyweight star is simply it is thicker and therefore heavier well it's not it's not heavy year just because your earlier complaint didn't it wasn't premised on the fact it was the same or different materials it no that's right and that's what makes this different they didn't to have a license and i'm just trying to figure out if you get a license for something that looks exactly like your star weight which seems to me what happened in the year two thousand and then you simply make it a little thicker i'm trying to figure out why why these stars are different they go they serve different purposes they go to different uses right now the green one is the less heavy one and the red one is the heavy right and if you if you wanted to make this as heavy heavyweights of the star did not exist at that time and that fact the star or the star came out right after that suit because we want to develop a trade dress and something that would clearly distinguish us from them seeing the star didn't exist or the heavyweight heavyweight star because obviously it covers the license covers a star but it covers the covers the eight graham star where did it where does that where does it say in the settlement agreement that it's the star is limited by its weight it's the trade dress at issue in the one nine hundred ninety nine complaint when you read when you read the complaint and we pulled out the portions in our brief the complaint specifically makes it clear that we're talking about the trade dress of of the of the lighter weight and that's the reason we went to a star and afterwards to say we want something that distinguishes us from them they went to a star you already had star we went to a heavyweight start then we already had two heavyweights in the in the earlier case and they and they had a license to that they did not have a license to a heavyweight star because we didn't have a heavy weight stock tell me what what there is that says that those heavier st as opposed to the lighter star or any other star has acquired secondary meaning or is not functional well first of all the sign of this star does or the design of this weight does nothing to hold the balloon down so it's not functional you know teddy bear a chair round whatever you want it will hold it down as well so the design is not functional and that's what you look at i pad doesn't remember the second first part was that had secondary middle secondary meaning ten years of exclusive use of this mark this trade dress selling seven million of the product that is classic acquisition of secondary meaning simply because you have been selling them that's it's certainly you know first of all people have rocks and they sell rocks and they're very successful at selling rocks that doesn't mean they're not going to remain in their rock and i agree with them we do addressed all of those issues in the brief you know we have you know we have the testimony of the customers recognize that they recognize that it's coming from a single source we've got ten years of the exclusive use of selling seven million of these units in that period of time we have our advertising sh this you don't do any ever test like this we do we do remember times in our district going to do advertise on the advertising that's even mentioned in these briefs unless i just missed it is that which is done by the distributor to whom you sell it and then who is a b when you've got ten years of big school use of use of a product there's a reason they came out and copied it this wasn't just happenstance of all the designs they could have chosen and they came out and and copied ours big the basic problem is that copying is generally speaking permitted that's true so you can copy unless something has developed a secondary meaning the fact that you sell a lot of them doesn't mean that the consumer done if eyes what they're buying with you as opposed to they need a balloon weight that makes the balloon outflow that's one element that's one element of acquisition of secondary meaning how long did you have exclusive use we you know  how many sales did you make that's another element of it do we have an established place in the market place your absolutely certain we have an established place in the marketplace we presented evidence from  ee of the four largest distributors of this of these products in the united states all of whom distribute this product me good to suggest that  you don't have secondary meaning the patent office or the trademark office will grant you proof of secondary meaning after five years of use of your students after that from the trademark no no no because because see eleven twenty five pay provides for this these rights this doesn't have to be registered you want to say anything about your price erosion yes a oh absolutely i want to say something about that the  we presented ten years of sales data ten years of sales data of our three largest customers that represent eighty percent of our sales and from that sales data we developed charts that show how the prices how the prices were maintained and how the prices grew over time without interruption with all kinds under all kinds of market conditions and it was nothing more than plotting data something that a high school student could do didn't require a technical expert in require a damages expert or an economist very very basic and you see how steady that was for all three of those suppliers for eighty percent of our seven million units in sales it here is the a balance of sales or the prices that they charge or is that the prices you charge the prices that we charge that's the money we lost as well but that's within your your choice i suppose your so you're saying that at some point you had to cut your prices absolutely and when you look at the chart you see it you see a dramatic change in price at the time that they came out with their product but they say that they were charging a higher price than you were at the time so why you have to cut your price to compete with the higher priced products because we don't know what their price is we have a one supplier market for this product for ten years one supplier being you being us tribute or as you sell it to the three distributors that distribute the vast majority of it that's right that's right so we're selling we're selling this a little nobody else is supplying this product and so we're getting the price that we want it's acquired secondary meaning people are asking for it people want this they're asking for it by by design and then all of a sudden they come out it's common sense that when somebody new comes to the market what do they do to get market share they'll typically drop the price or the come in with a lowball price we didn't know what their price was but mr nelson was you know in the little odd in the sense that you would think that the distributors either you testified to it is david we can get these cheaper now we can get these cheaper now that means you didn't know what their price know we didn't know what the prices were and you want to know why but it wasn't even necessarily true but which is what a distributor tends to say exactly exactly that's what i'm saying and you can fault mr nelson for lowering his price when all of a sudden a competitor comes in for the first time in ten years when he's hearing from his customers that they can get lower prices the test here is a but for test but further the infringement the price would not have been  that is classic price erosion doesn't make any difference whether mr nelson knew what they were selling how many they were selling or whatever he did to their infringement and he acted in a reasonable and rational manner he leverage its price to maintain his market share and then what happens all of a sudden his customers know that he can sell this i don't know what price and he can't just because he gets an injunction from judge pearson say oh no your price is going up you don't do that with customers and so you have to grow that price back and he testified to that he testified that it took him five years to get to the price level he was asked when that and then was able to maintain when creative came into the market and it's going to take him five years to get back again the but for test district court was look there's all turn it designs here or you could have made a star that was different than our design well the reason we made the star like we did is because we believed we had a license to use it under that settlement agreement regardless of size and weight which are not in that settlement agreement as part of the definition of the trade dress in that namely clause but you know the other issue here though is functionality and whether the design is essential to the use or purpose of the article and this court recently in the decision looked again at the issue of product configuration trade dress infringement and the plaintiff in that case took the same approach here as p v a and said well there were other pumps out there you can a made a pump that was more like theirs and less like mine and the six circuit said that's not the test if you meet the definition functionality under in wo then that's the end of the question we don't need to look at alternative designs now we believe we met the question of functionality under in wood because we have a star weight here that weighs a certain amount depending on the kind of balloons you're going to pare it with and the star also the purpose of the article is to match it to balloons that likewise have stars and there are a match and that is a functional purpose it needs to be a star to match to a star balloon and that's to testimony  as far as acquire distinctiveness and you know we're hearing again about intentional copying and there was no intentional caught being here we just went with our to start a star but at the surface area of our stars the same as the eight gram you can stack one on top of the other it's just sick or to be heavier and then i'd like to say something about the whole issue of price erosion damages here our list prices were actually higher than their that's the evidence and there's no have been in that evidence submitted by and our client testified at the damages hearing and there was no evidence that creative ever sent price quotations to these three anonymous customers who supposedly demanded that p p a cut prices because a very clear when you say the three customers these are not the three distributors there are three distributors  only testimony we have on that that these distributors demanded price cuts was coming from mr nelson there is no documentary evidence from these customers saying hey cut your prices and in fact in a deposition mr nelson testified about the severe price gouging that was going on and there's never been any documentary evidence to back  up and as far as their expert on damages they say oh a high schooler could just take our numbers and do the math but you know as the court found those price erosion calculations were inadequate for just the simple reason that they failed to take into account the economic principle of elasticity of demand which means that if you have a higher price you're going to have decreased sales and the court found there were a lot of other factors in the record that could have influenced their pricing including flat demand the lower pricing they offered to balloon manufacturers a worldwide helium shortage  which started in about two thousand and eight and so there is there's just no evidence of causation here and the law is that to be entitled to actual you can we go on to the balloons