The Honorable Charles R. Wolle, Chief Judge, United States

1

District Court for the Southern District of Iowa.

 For ease of reference, we refer to the plaintiff-appellant as 2

"FB" and defendants-appellees as "FBS" throughout this opinion,

while recognizing that the entities have undergone name changes and

consolidation in the past.

___________

No. 95-2238 

___________

First Bank, *

*

Appellant, *

* Appeal from the United States

v. * District Court for the 

* Southern District of Iowa. 

First Bank System, Inc.; and * 

First Bank, fsb, formerly known * 

as Metropolitan Federal Bank, *

fsb, *

*

Appellees. *

___________

 Submitted: December 13, 1995

 Filed: May 29, 1996

___________

Before McMILLIAN, JOHN R. GIBSON, and BEAM, Circuit Judges.

___________

BEAM, Circuit Judge.

First Bank (FB) appeals the district court's order dissolving a

1

preliminary injunction and denying its motion for a permanent injunction

against the use of FIRST BANK, FIRST BANK IOWA, or any colorable imitations

of those terms by First Bank System, Inc. (FBS). Because FB failed to

2

prove the facts essential to establish a common-law trademark, we affirm.
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I. BACKGROUND

This case involves a dispute between two banks over the use of FIRST

BANK in connection with banking services provided in the Iowa counties of

Polk, Dallas, and Warren. One of these banks, FBS, is a federally

chartered bank holding company with its principal place of business in

Minneapolis, Minnesota. FBS owns banks in several states and provides

banking services throughout the United States. Since the early 1970s, FBS

has provided various banking services in Iowa--such as home improvement

loans, correspondent banking, commercial lending, and credit cards--even

though FBS did not have an office in Iowa. Rather, FBS promoted and

provided its services through advertising, personal contacts and the mail.

As part of its acquisition of Metropolitan Federal Bank, fsb, in late

1994, FBS obtained several branches in Iowa. On February 18, 1995,

Metropolitan Federal Bank, fsb, changed its legal name to First Bank, fsb.

The former Metropolitan Federal Banks in Iowa were renamed First Bank Iowa.

FBS has owned several trademark registrations, including: (1) an Iowa

registration on FIRST BANK SYSTEMS from 1968 to 1978; (2) an Iowa

registration on FIRST BANK and a design from 1968 to 1978; (3) a federal

registration for FIRST BANK SYSTEM and a design from 1971 to 1991; (4) a

federal registration for FIRST BANK SYSTEM issued December 26, 1989,

asserting first use on August 26, 1968; (5) a federal registration for

FIRST BANKS and a design issued June 21, 1994, asserting first use on

October 4, 1991; and (6) an Iowa service mark application for FIRST BANK

filed November 14, 1986, claiming use in Iowa on October 1979. 

The other bank, FB, is an Iowa chartered bank with its principal

place of business in West Des Moines, Iowa. Prior to 1993, FB was a

federally chartered bank. From 1938 to 1993, FB was known as First

National Bank of West Des Moines. FB has never owned a registered

trademark for FIRST BANK. FB relies instead on
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the common law of trademarks for its claim of an exclusive right to use

FIRST BANK in connection with banking services provided in these counties.

Beginning in 1970, FB used a logo which combined a prominent Arabic

numeral "1" with the phrase "FIRST NATIONAL BANK OF WEST DES MOINES"

(1970 logo). In order to compete more effectively with a rival bank in

West Des Moines commonly referred to as "West Bank," FB emphasized the

words "FIRST" and "BANK" in this logo by printing those two words in larger

letters. The word "NATIONAL" remained on the logo in smaller print, as did

the phrase "OF WEST DES MOINES," until a modernized version of the logo

appeared in December of 1985 (1985 logo). FB printed the 1970 logo on

various items--including checks, stationary, envelopes, and business

cards--and used it in advertisements. In 1970, FB had over 1700 customers

in Iowa. Rex Weitzell, FB's advertising agent in the 1970s, testified that

he referred to the bank as "First Bank" during his tenure with the bank.

William Fultz, an advertising agent, also testified that he referred to FB

as "First Bank" in the early 1970s while he was doing work for Bankers

Trust. Roy Messerschmidt, Chairman of FB, testified that FB has identified

itself as "First Bank" when it answers the telephone since 1970.

Thomas Porter, FB's advertising agent, testified that he was under

the impression that in 1985 people were referring to FB as "First Bank."

Nevertheless, in 1985, he suggested that the officers and board of FB make

a concerted effort to change the bank's name to "First Bank." Porter

testified that the primary reason the bank should change its name was to

preempt FBS from using FIRST BANK in Iowa. Porter was aware of ongoing

efforts by FBS to acquire a chain of banks in Iowa. Before adopting the

name change and new logo, FB consulted with G. Brian Pingel, Esq., a

trademark attorney. In a letter dated October 4, 1985, Pingel advised FB

to begin using FIRST BANK as soon as possible, but he warned FB about

several potential conflicts, including the existing
 In fact, FB was required to print the 1985 logo in

3

combination with "FIRST NATIONAL BANK OF WEST DES MOINES" until it

became a state chartered bank in 1993. Subsequently, FB printed

the 1985 logo with other phrases, such as "THE BANK DES MOINES

CALLS FIRST."

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FBS federal trademark registration for FIRST BANK SYSTEM. In that letter,

Pingel repeatedly referred to FB as "First National" rather than "First

Bank." 

Throughout the early 1980s, FB continued to attach its 1970 logo to

bank documents and used those logos in various promotional materials.

Advertisements printed during the 1980s, however, contained quotations in

which satisfied customers referred to FB as "First National" not as "First

Bank." In an effort to further emphasize the "First Bank" concept and

facilitate its attempted name change, FB used the 1985 logo, which only

contained the Arabic numeral "1" and the two words "FIRST BANK" in

advertisements and on bank documents (e.g., checks, and stationery).3

Finally, on December 22, 1993, FB changed its legal name to "First Bank."

In July 1994, FB heard that FBS was in the process of acquiring

Metropolitan Federal Bank branches in Iowa, some of which were in FB's

primary market area of Polk, Dallas, and Warren counties. Counsel for FB

contacted FBS and expressed concern over FBS's possible use of FIRST BANK

in connection with banking services provided in FB's primary market area.

FBS did not respond to FB's concerns until three days before FB filed the

complaint in the present case on January 12, 1995. FB claimed that it had

the exclusive right to use FIRST BANK in connection with banking services

it provided in its primary market area and alleged that FBS violated both

federal and Iowa trademark laws. The district court denied a temporary

restraining order but subsequently granted FB a preliminary injunction on

February 1, 1995.

FB requested a permanent injunction to prohibit FBS from using FIRST

BANK or any colorable imitation in FB's primary market area. 
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After conducting the first part of a bifurcated trial, the district court

dissolved the preliminary injunction and denied the request for a permanent

injunction. In an order dated April 19, 1995, the district court held,

inter alia, that: (1) FB had failed to prove that it had used the name

"First Bank," rather than "First National," prior to 1971 when FBS

registered its federal trademark for FIRST BANK SYSTEM; and (2) the words

"First Bank" did not have a secondary meaning referring to FB until after

1986, which was well after those same words had acquired a secondary

meaning in Iowa referring to FBS in connection with banking services it

provided in Iowa by mail from outside the state. The district court also

determined that equitable considerations favored denying the permanent

injunction.

 

FB appeals pursuant to 28 U.S.C. § 1292(a), claiming that the

district court committed several errors in its findings of fact and

conclusions of law. Specifically, FB contends that it already had a

common-law trademark in FIRST BANK, based primarily on FB's extensive use

of its 1970 logo, prior to FBS's 1971 federal trademark registration. FB

also argues that the district court erred in holding that actual confusion

is insufficient to establish trademark infringement. Finally, FB asserts

that it was error for the district court to conclude that FB's adoption of

FIRST BANK was in bad faith.

II. DISCUSSION

The narrow question before us is whether the district court erred in

denying FB's motion for a permanent injunction. We review a district

court's denial of a motion for a permanent injunction under the abuse of

discretion standard. International Ass'n of Machinists & Aerospace

Workers, Dist. Lodge No. 19 v. Soo Line R.R. Co., 850 F.2d 368, 374 (8th

Cir. 1988), cert. denied, 489 U.S. 1010 (1989). An abuse of discretion

occurs when the district court bases its decision on an error of law or a

clearly erroneous
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finding of fact. Id. Although FB raises several issues on appeal, our

inquiry focuses on the dispositive issue of whether the district court was

clearly erroneous in finding that FIRST BANK had not achieved

distinctiveness, or secondary meaning, in connection with FB's banking

services prior to FBS's federal trademark registration or use of its FIRST

BANK SYSTEM mark. For the reasons discussed below, we agree with the

district court that FB failed to prove that FIRST BANK acquired secondary

meaning prior to 1986 and thus FB's injunction action fails.

In asserting the exclusive right to use FIRST BANK in connection with

banking services in the relevant Iowa counties, FB has not claimed that it

possesses a registered trademark, which would have been prima facie

evidence of a valid trademark. 15 U.S.C. § 1115(a). Therefore, FB must

rely on the existence of a common-law trademark in bringing this lawsuit.

Moreover, because FB claims exclusive use of FIRST BANK in the three Iowa

counties, it must prove that it had a common-law trademark prior to FBS's

registration or use of its FIRST BANK SYSTEM mark. See Wrist-Rocket Mfg.

Co., Inc. v. Saunders Archery Co., 578 F.2d 727, 730 (8th Cir. 1978)

(recognizing that while a registered trademark owner's rights can become

incontestible, other common-law trademark owners retain exclusive rights

in those areas where their rights antedated registration). In contrast,

registration of the FBS mark established prima facie evidence of a valid

trademark and provided nationwide constructive notice of that mark, see 15

U.S.C. §§ 1072 & 1115(a); Old Dutch Foods, Inc. v. Dan Dee Pretzel & Potato

Chip Co., 477 F.2d 150, 156 (6th Cir. 1973), or any colorable imitations

such as FIRST BANK or FIRST BANK IOWA, see 15 U.S.C. §§ 1114(1) & 1127.

Thus, FB can only prohibit the use of FIRST BANK SYSTEM, or any colorable

imitation, in its market area if it meets three requirements. First, FB

must prove that it had a common-law trademark in FIRST BANK antedating

registration of FBS's mark. Second, FB must prove that its common-law mark

is similar enough to FBS's mark to create a substantial likelihood of

confusion among
 The Restatement (Third) of the Law of Unfair Competition § 9 4

(1995) defines a trademark as "a word, name, symbol, device, or

other designation, or a combination of such designations, that is

distinctive of a person's goods or services and that is used in a

manner that identifies those goods or services and distinguishes

them from the goods or services of others."

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consumers. See 15 U.S.C. §§ 1114(1) & 1125(a)(1)(A). Third, FB must

demonstrate that the court's exercise of equitable power is appropriate.

See 15 U.S.C. § 1116.

Turning to the first requirement, a common-law trademark arises from

the adoption and actual use of a word, phrase, logo, or other device to

identify goods or services with a particular party. See, e.g., Co-Rect

Prods., Inc. v. Marvy! Advertising Photography, Inc., 780 F.2d 1324, 1329

(8th Cir. 1985) (quoting the statutory definition set out in 15 U.S.C. §

1127); 3 Rudolf Callmann, The Law of Unfair Competition, Trademarks and

Monopolies § 19.01, at 19-3 (4th ed. 1994). To succeed on its claim of

4

a common-law trademark, therefore, FB must prove: (1) that it actually

used FIRST BANK in connection with banking services provided in the

relevant Iowa counties; and (2) that FIRST BANK identified FB as the

provider of those services in the minds of consumers.

Assuming, arguendo, that FB actually used FIRST BANK in connection

with banking services provided in the relevant Iowa counties prior to FBS

obtaining its federal registration, FB must prove that consumers (i.e., its

customers and potential customers) identified FIRST BANK with FB as the

provider of those banking services in these counties prior to FBS obtaining

its federally registered mark. In order to qualify for trademark

protection, therefore, FIRST BANK must distinctly identify FB as the

provider of certain banking services in the minds of consumers. We begin

our inquiry as to whether FIRST BANK is sufficiently distinct to achieve

this by classifying it into one of four categories: (1)
 A mark that suggests some quality or ingredient constitutes 5

a suggestive trademark, which is entitled to trademark protection

without proving secondary meaning. See 1 J. Thomas McCarthy,

McCarthy on Trademarks and Unfair Competition § 11.20, at 11-104.4

(3d ed. 1996).

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generic; (2) descriptive; (3) suggestive; or (4) arbitrary or fanciful.

5

See Cellular Sales, Inc. v. Mackay, 942 F.2d 483, 485 (8th Cir. 1991).

Generic terms are not entitled to protection under trademark law because

"such words are in `the public domain and available for all to use[.]'"

Id. at 486 (quoting Hallmark Cards, Inc. v. Hallmark Dodge, Inc., 634 F.

Supp. 990, 997 (W.D. Mo. 1986)). At the other end of the spectrum, we

consider an arbitrary or fanciful mark the strongest possible trademark,

thus entitling it to the maximum degree of legal protection without

requiring any proof of secondary meaning. Id. A descriptive trademark is

the weakest protectable mark and requires proof that the mark has acquired

secondary meaning. Id. 

A trademark user establishes secondary meaning by showing that

through "long and exclusive use in the sale of the user's goods, the mark

has become so associated in the public mind with such goods that the mark

serves to identify the source of the goods and to distinguish them from

those of others." Aromatique, Inc. v. Gold Seal, Inc., 28 F.3d 863, 870

(8th Cir. 1994) (citing Co-Rect Prods., Inc., 780 F.2d at 1330). The

primary inquiry in determining whether the mark has attained secondary

meaning is whether the mark has become associated with a particular source

in the consumer's mind. Id. at 871 (citing Co-Rect Prods., Inc., 780 F.2d

at 1332-33); First Fed. Sav. & Loan Ass'n of Council Bluffs v. First Fed.

Sav. & Loan Ass'n of Lincoln, 929 F.2d 382, 384 (8th Cir. 1991) (A

descriptive term only becomes protectable under trademark law "when it

conjures up a particular service or product in the minds of customers.").
 Some of the testimony took place only at the preliminary

6

injunction hearing (e.g., Bowermaster's testimony). Other

testimony occurred during the first part of the bifurcated trial,

or at both proceedings.

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In the present case, FB concedes that FIRST BANK is a descriptive

term and thus is not inherently distinctive. FB contends, however, that

FIRST BANK acquired secondary meaning, thereby identifying the mark with

banking services provided by FB in the relevant Iowa counties. To support

its contention, FB offered testimony by the creator of the 1970 logo,

advertising agent Jim Bowermaster, that the advertising campaign in late

1969 and early 1970, along with the 1970 logo, was to establish the concept

of "First Bank." Roy Messerschmidt, Chairman of FB, testified that the 6

1970 logo was used on all of the bank's documents. He also testified that

he thought, for the most part, that FB started answering the telephone

"First Bank" in 1970. As noted earlier, advertising agent, Thomas Porter,

testified that he was under the impression that people were referring to

FB as "First Bank" in 1985. FB also argues that in addition to wide-spread

dissemination of the 1970 logo, FB had substantial accounts in these

counties prior to 1971.

This type of evidence simply fails to establish sufficient proof that

consumers identified FIRST BANK with the services provided by FB, which is

the focus of our secondary meaning analysis. FB's evidence of secondary

meaning consisted almost exclusively of efforts undertaken by the bank to

identify itself as FIRST BANK prior to 1971. Although relevant, FB's

efforts are not determinative of whether consumers actually identified

FIRST BANK with FB. See Co-Rect Prods., Inc., 780 F.2d at 1332 (stating

that while "advertising is a relevant factor in determining whether a mark

has acquired a secondary meaning, it is the effect of such advertising that

is important, not its extent") (emphasis in original); Wrist-Rocket Mfg.

Co., 578 F.2d at 732 (stating that "common-law trademark rights cannot be

established by advertising
 Although FB theoretically could obtain two common-law

7

trademarks (i.e., FIRST BANK and FIRST NATIONAL), the absence of

any customer reference to FB as "First Bank" in its advertisements

supports the district court's conclusion that FB failed to prove

that FIRST BANK had acquired secondary meaning identifying FB as

the provider of certain banking services in the three Iowa counties

until after 1986.

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alone"); Charles E. McKenney & George F. Long, III, Federal Unfair

Competition: Lanham Act § 43(a) § 3.05, at 3-53 (1995) ("Evidence of

advertising and extent of use of the mark in controversy are obviously

important factors but are not determinative, such proofs demonstrating a

party's efforts to establish secondary meaning but not necessarily

demonstrating that such efforts were in fact successful.") (footnotes

omitted). FB's failure to identify itself with FIRST BANK in the minds of

consumers was further highlighted by William Fultz, FB's own expert witness

on advertising who testified, on cross-examination, that it takes a long

time for a business to establish an identity with a particular logo or

slogan. He admitted that FB probably had not yet been successful in

identifying itself as "First Bank" in the mid-1980s, given that customers

had consistently referred to FB as "First National" in its advertisements.

Furthermore, the record reflects that FB never actually used the

words "First" and "Bank" consecutively in any document, advertisement, or

other printed medium prior to 1985, when it began to develop the 1985 logo.

Moreover, Pingel, FB's own trademark attorney, consistently referred to FB

as "First National" in his letter of October 4, 1985, in which he

recommended adopting and using FIRST BANK as soon as possible. Roy

Messerschmidt also recommended to FB's board of directors that it should

start using FIRST BANK in the mid-1980s. Finally, the record is replete

with examples of FB customers referring to FB as "First National" rather

than "First Bank" throughout the 1980s.7
 Even if FB were able to rebut the statutorily prescribed

8

presumption that FBS owned a valid trademark dating from its

registration in 1971, see 15 U.S.C. § 1115(a), the district court

also found that FBS actually used and acquired secondary meaning in

FIRST BANK SYSTEM in the relevant Iowa counties, thereby

establishing a common-law trademark, before FB established a

common-law trademark in FIRST BANK.

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FB asserts that Pingel's references to FB as "First National" and

recommendation that FB start using FIRST BANK, as well as Porter's

recommendation that FB change its name to "First Bank" in order to preempt

FBS from using FIRST BANK in Iowa, should not have been given any weight

by the district court because neither man knew that FB had used FIRST BANK

in the past. At a minimum, however, the fact that neither of the two men

hired by FB to promote it as FIRST BANK (i.e., its trademark lawyer and

advertising agent) were aware that FB had attempted to identify itself with

FIRST BANK in the past provides some indication of the success FB was

experiencing in its effort to be recognized as "First Bank." 

When evidence on the issue of secondary meaning is, at best,

conflicting, as in the present case, we will not disturb the district

court's factual finding unless upon reviewing the entire record we are left

with the definite conviction that the lower court made a mistake.

Aromatique, 28 F.3d at 868; see also First Fed. Sav. & Loan of Council

Bluffs, 929 F.2d at 384 (holding that the district court was not clearly

erroneous in finding that the term "First Federal" was a descriptive mark);

G.H. Mumm & Cie v. Desnoes & Geddes, Ltd., 917 F.2d 1292, 1294 (Fed. Cir.

1990) (stating that a determination of secondary meaning is a question of

fact which is reviewed on appeal under the clearly erroneous standard).

Applying this standard, we conclude that the district court did not commit

clear error. We agree with the district court that FB failed to prove that

FIRST BANK had attained secondary meaning before 1986, which is well after

FBS registered its FIRST BANK SYSTEM trademark in 1971. 

8
 Because we conclude that FB failed to prove that FIRST BANK 9

was distinctive (i.e., that it had acquired secondary meaning)

prior to FBS's registration or use of FIRST BANK SYSTEM--which is

fatal to FB's claim--we need not discuss any other factual

requirement necessary to establish a common-law trademark.

Likewise, because FB failed to prove that it had a common-law

trademark we need not determine whether FIRST BANK and FIRST BANK

SYSTEM or FIRST BANK IOWA are similar enough to create a likelihood

of confusion among customers.

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III. CONCLUSION

The district court did not commit clear error in finding that FB

failed to prove the facts necessary to establish a common-law trademark

that antedated FBS's registration of its mark and thus FB was not entitled

to the exclusive use of FIRST BANK in these counties. Moreover, we have 9

examined the equitable considerations presented in this case and conclude

that the district court did not abuse its discretion in denying the

permanent injunction. Accordingly, we affirm the district court's order.

Finally, we have considered the other arguments advanced by FB and find

them to be without merit.

A true copy.

Attest:

CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.