## F I L E D United States Court of Appeals Tenth Circuit 

### JUL 8 1999 

### PATRICK FISHER Clerk PUBLISH
UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

KING OF THE MOUNTAIN SPORTS, INC., a Wyoming corporation, Plaintiff - Appellant,

v. CHRYSLER CORPORATION, a Michigan corporation; ECLIPSE TELEVISION AND SPORTS MARKETING, LLC, a Colorado limited liability company; ECLIPSE TELEVISION AND SPORTS MARKETING, INC., a California corporation; HENRY SCHNEIDMAN, an individual, and MARK SCHELDE, an individual,

Defendants - Appellees, and BOGNER OF AMERICA, INC., a Delaware corporation,

Defendant. No. 97-1290

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO

(D. Ct. No. 96-B-250)2

Scott S. Havlick (Donald A. Degnan and Rita S. Heim es, with him on the briefs), Holland & Hart, LLP, Boulder, Colorado, appearing f or Plaintiff-Appellant. Richard P. Holme (Glenn K. Beaton and Bruce L. Plotkin, with him on the brief), Davis, Graham & Stubbs, LLP, Denver, Colorado, appe aring for DefendantsAppellees.

Before TACHA , HENRY , and LUCERO , Circuit Judges.

TACHA , Circuit Judge.

Plaintiff King of the Mountain Sports, Inc. (“KOM”) filed suit against defendants alleging that they infringed its trademark and violated the Federal Anti-Dilution Act and Colorado Consumer Protection Act. The district court granted defendants’ motion for summary judgment on all claims. KOM appealed only the disposition of its trademark infringement claims. We exercise jurisdiction pursuant to 28 U.S.C. § 1291 and affirm. I. Background Plaintiff sells camouflage-patterned, natural fiber , outdoor clothing and related mountaineering accessories. It obtained a federal registration for its first stylized trademark on June 4, 1991, and for a secon d stylized mark on September 28, 1993. “[Plaintiff’s] first mark consisted of the words ‘King of the Mountain Sports Inc.’ in Gothic lettering superimposed on th e outline of a mountain and enclosed by a thin, rectangular border.” King of the Mountain Sports, Inc. v.3 Plaintiff’s first mark.

Plaintiff’s second mark. Chrysler Corp. , 968 F. Supp. 568, 570 (D. Colo. 1997).

The second mark consists of the words “King of the Mountain” in Gothic lettering with an outline of a mountain in the background. A s used, plaintiff’s marks employ dark lettering against drab background color s such as the blacks, browns, and greens found in camouflage. The Gothic letteri ng is horizontally oriented in one line and only the “K” of King and “M” of Mounta in are capitalized.

Plaintiff primarily markets its products to hunters , fishers, campers, and hikers but notes that its customers use its products for a ll cold weather outdoor activities. It also contends that the downhill ski ing and snowboarding apparel markets are a logical expansion area for its produc t line. In 1995, defendant Eclipse Television and Sports Marketing LLC (“Eclipse”) purchased from defendant Eclipse Televi sion and Sports Marketing,4 Defendants’ primary logo. Inc. (“Eclipse California”) the right to contract w ith defendant Chrysler to use the “Jeep KING OF THE MOUNTAIN DOWNHILL SERIES” logo. “Defendants’ primary logo consists of the word ‘Jeep’ in largest , purple type above the words ‘KING OF THE MOUNTAIN’ in smaller, blue type, and the words ‘DOWNHILL SERIES’ in even smaller, red type at the bottom of the logo.” King of the Mountain Sports , 968 F. Supp. at 570. Other than the word “Jeep,” all words consist entirely of capital letters and “are superi mposed over a blue outline of a mountain with a picture of a red ski racer in a tuc ked position and a series of red and orange straight lines stretched out behind him to suggest the speed with which he is racing.” Id.

Defendants’ logo, however, does not always conform to this description. For example, on banners and scoreboards, defendants hav e employed a bright blue background with the word “Jeep” on either side of “ KING OF THE MOUNTAIN”5

in stark white, bold, capital letters. Also, telev ision listings have simply referred to the event as “Skiing: King of the Mountain Downh ill Series.” Defendants use the logo to identify and promote a s eries of televised downhill ski races. To this end, they have placed the logo, for example, on billboards, banners, clothing apparel, and in magaz ines. Defendants have given away several items of clothing featuring the logo t o participants, television commentators, and spectators at the skiing events. Defendant Bogner manufactures the ski jackets upon which defendants’ logo appears. Plaintiff objects to defendants’ use of the phrase “king of the mountain” in the name of its ski event. It argues that defendan ts’ use of the phrase creates a likelihood of sponsorship confusion. Plaintiff fears that its consumers will believe that KOM sponsors, or is otherwise associat ed with, the downhill skiing

event. Defendants filed a summary judgment motion in distr ict court arguing, as to the trademark infringement claims, that no likeliho od of confusions exists. After thoroughly analyzing the appropriate factors, the d istrict court agreed with defendants and entered summary judgment against KOM

. II. Discussion We review the grant of summary judgment de novo, us ing the same standard applied by the district court. See, e.g. , First Sav. Bank, F.S.B. v. First1 To the extent that a more recent panel decision con flicts with the standard

of review enunciated in prior Tenth Circuit authori ty, we are bound by the earlier cases. See Clymore v. United States , 164 F.3d 569, 573 n.5 (10th Cir. 1999) (asserting that the earlier opinion “‘constitutes b inding circuit precedent constraining subsequent panels absent en banc recon sideration or a superseding contrary decision by the Supreme Court. . . . [Thus ,] when faced with an intracircuit conflict, a panel should follow earlier, se ttled precedent over a subsequent deviation therefrom.’” (quoting Haynes v. Williams , 88 F.3d 898, 900 n.4 (10th Cir. 1996) (internal citations omitted))). 6 Bank Sys., Inc. , 101 F.3d 645, 650 (10th Cir. 1996); Universal Money Ctrs., Inc. v. American Tel. & Tel. Co. , 22 F.3d 1527, 1529 (10th Cir. 1994). 1 Summary judgment is appropriate “if the pleadings, depositi ons, answers to interrogatories, and admissions on file, together with the affidavit s, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Fed. R. Civ. P. 56(c ). “‘When applying this standard, we examine the factual record and reasonable inferences therefrom in the light most favorable to the party opposing summary judgment.’” Universal Money Ctrs. , 22 F.3d at 1529 (quoting Applied Genetics Int’l, Inc. v. First Affiliated Sec., Inc. , 912 F.2d 1238, 1241 (10th Cir. 1990)). Likelihood of confusion forms the gravamen for a tr ademark infringement action. See 15 U.S.C. §§ 1114(1), 1125(a). Section 43(a) of the Lanham Act declares that any person who uses in commerce any word, term, name, symbol, or d evice, . . . which . . . is likely to cause confusion, or to cau se mistake, or to deceive as to the affiliation, connection, or assoc iation of such7

person with another person, or as to the origin, sp onsorship, or approval of his or her goods, services, or commerci al activities by another person . . . shall be liable in a civil act ion by any person who believes that he or she is or is likely to be damag ed by such act. Id. § 1125(a). Although “likelihood of confusion is f requently a fairly disputed issue of fact on which reasonable minds may differ, the issue is amenable to summary judgment in appropriate cases.” Universal Money Ctrs. , 22 F.3d at 1530 n.2 (internal quotation marks and citation omitted); accord First Sav. Bank , 101 F.3d at 650. “[C]ourts retain an important authori ty to monitor the outer limits of substantial similarity within which a jury is permi tted to make the factual determination whether there is a likelihood of confusion.” Universal Money
Ctrs. , 22 F.3d at 1530 n.2 (internal quotation marks and citation omitted); accord First Sav. Bank , 101 F.3d at 650. Thus, in order to prevail on appeal, plaintiff mustshow that a genuine issue of material fact exists regarding whether defendant s’ use of its logo would likely cause confusion about the sponsorship of the downhi ll ski race. The Tenth Circuit has identified six factors, derived from th e Restatement of Torts § 729 (1938), that aid in determining whether a likelihoo d of confusion exists between two marks: (a) the degree of similarity between the marks; (b) the intent of the alleged infringer in adopting its mark; (c) evidence of actual confusion; (d) the relation in use and the manner of marketing between the goods or services marketed by the competing parties ;8

(e) the degree of care likely to be exercised by pu rchasers; and (f) the strength or weakness of the marks. First Savings Bank , 101 F.3d at 652; see also Universal Money Ctrs. , 22 F.3d at 1530; Restatement (Third) of Unfair Competition §§ 20-23 (1995). “This list is not exhaustive. All of the factors are interrelate d, and no one factor is dispositive.” Universal Money Ctrs. , 22 F.3d at 1530. While we consider these factors to determine whether a likelihood of confus ion exists regardless of whether the trademark infringement suit involves source or sponsorship confusion, see GTE Corp. v. Williams , 904 F.2d 536, 539-40 (10th Cir. 1990); Amoco Oil Co. v. Rainbow Snow , 748 F.2d 556, 558 (10th Cir. 1984), the weight af forded to some of the factors differs when applied in these separate contexts. In both confusion of source and confusion of sponsorship cases, the simi larity of the marks factor constitutes the heart of our analysis. See Heartsprings v. Heartspring , 143 F.3d 550, 554 (10th Cir. 1998) (recognizing that the keyinquiry in a source confusion case is “whether the consumer is likely to be decei ved or confused by the similarity of the marks.’” (quoting Two Pesos, Inc. v. Taco Cabana, Inc. , 505 U.S. 763, 780 (1992))); Wendt v. Host Int’l, Inc. , 125 F.3d 806, 812 (9th Cir. 1998) (emphasizing the primacy of the similarity of mark factor in a confusion of endorsement analysis). However, in the rare, pure sponsorship action, other factors -- such as the relation in use and the mann er of marketing between the goods or services and the degree of care likely to be exercised by purchasers --9

have little importance. Bearing this in mind, if, as in any case, the examination of the various factors establishes a genuine issue of material fact regarding the likelihood of sponsorship confusion, summary judgme nt is not appropriate. A. Similarity Between the Marks We test the degree of similarity between marks on three levels: sight, sound, and meaning. See, e.g. , First Sav. Bank , 101 F.3d at 653; Universal Money Ctrs. , 22 F.3d at 1530-31; Beer Nuts, Inc. v. Clover Club Foods Co. , 805 F.2d 920, 925 (10th Cir. 1986). We do not considerthese factors in isolation. Instead, we must examine them “in the context of th e marks as a whole as they are encountered by consumers in the marketplace.” Beer Nuts , 805 F.2d at 925; accord Heartsprings , 143 F.3d at 554; Universal Money Ctrs. , 22 F.3d at 1531; 3 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 23:47 (4th ed. 1996) (“Conflicting marks consisting of bo th words and pictorial symbols must be compared in their entireties to determine likelihood of confusion.” (emphasis in original)). Furthermore, we do not en gage in a “‘side-by-side’ comparison.” Universal Money Ctrs. , 22 F.3d at 1531. Rather, “the court must determine whether the alleged infringing mark will be confusing to the public when singly presented.” Id. (internal quotation marks and citation omitted). We give the similarities of the marks more weight than the differences. See id. In this case, plaintiff argues that because defenda nts employ the phrase2 KOM argues in its reply brief that it has a common law trademark not only

in its stylized logo but also in the words “King of the Mountain.” It did not raise this argument in its opening brief. It made only apassing reference that its complaint includes a claim for common law trademarkinfringement. Therefore, it waived the argument that it has a common law tra demark in the words “King of the Mountain” that defendants infringed. See, e.g. , State Farm Fire & Cas. Co. v. Mhoon , 31 F.3d 979, 984 n.7 (10th Cir. 1994) (asserting that failure to raise an issue in the opening brief waives the issue); Codner v. United States , 17 F.3d 1331, 1332 n.2 (10th Cir. 1994) (holding we will no t consider issue raised for first time in reply brief); Ambus v. Granite Bd. of Educ. , 975 F.2d 1555, 1558 n.1 (10th Cir. 1992) (declaring that an issue mentionedin brief on appeal, but not addressed, is waived). Moreover, in its complaint plaintiff only claimed a violation of its common law trademark rights to its stylized logo, distinguishing “King of the Mountain” as its trade name and “King of the Mountain” with design composite as its trademark. Therefore, the districtcourt did not address the contention KOM now asserts. This provides addition al support for finding that plaintiff has waived this argument. See, e.g. , Singleton v. Wulff , 428 U.S. 106, 120 (1976) (“[A] federal appellate court [will] notconsider an issue not passed upon below.”). 10 “King of the Mountain,” the similarity factor weigh s in favor of it and creates a genuine issue of material fact regarding likelihoodof confusion. We disagree. Comparing the stylized trademark of plaintiff with the ways in which defendants have used the phrase “king of the mountain,” we hol d that no reasonable jury could find similarity. Even assuming that the phra se “king of the mountain” constitutes the dominant portion of defendants’ log o, as plaintiff argues, the marks as a whole 2are not confusingly similar. Although defendants’ logo employs, in part, the same phrase as plaintiff’s mark and therefore might sound somewhat similar, the sight and sense of meaning in voked by defendants’ logo and plaintiff’s stylized mark differ drastically. First, plaintiff’s stylized mark is3 We have also reviewed the record and considered the ways, outside their

primary logo, that defendants have used the phrase “king of the mountain” in 11 in Gothic lettering, with only the first letter of “King” and “Mountain” capitalized, against a solitary mountain ridge outl ine. It appears in camouflage colors, consistent with plaintiff’s marketing towar d hunters. In short, the mark is quite understated. The opposite is true regarding the ways in which defendants have used the phrase “king of the mountain.” Defen dant’s primary logo is quite colorful, done in brilliant blue, purple, red, and orange. The letters consist of bold capitals, and the words are vertically oriente d. The mountain outline in the background has a different shape than that in plaintiff’s mark, and the logo depicts a skier with red and orange lines shooting out from behind him to suggest the great speed at which he flies down the mountain side. Thus, the visual impact of the plaintiff’s mark and defendants’ logo differ s dramatically. Moreover, as the district court noted, the marks of plaintiff and defendants do not conveythe same meaning or stimulate the same mental reaction. Pla intiff’s marks are simple, reserved, and dignified. Indeed, one of pl aintiff’s complaints is that it does not want to be associated with the ‘glitzy’ ski races promoted by defendants. Defendants’ mark is brightand attentiongrabbing, connoting the fun and speed associated wi th ski racing. King of the Mountain Sports, Inc. v. Chrysler Corp. , 968 F. Supp. 568, 573 (D. Colo. 1997). Thus, the first and most important fa ctor, similarity of the marks, weighs heavily in defendants’ favor. 3connection with promoting their ski event. For example, the phrase “king of the

mountain” in connection with the words “Jeep” and/o r “downhill series” appears on banners, ski jackets, contestants’ bibs, and adv ertisements. All involve bold capital letters appearing in white against a bright ly colored background or in bright colors against a white background. Comparin g plaintiff’s stylized mark with these uses, we hold that no similarity betweenthem exists. We likewise reject plaintiff’s contention that the television l istings of and the other printed references to defendants’ event in the record are c onfusingly similar to KOM’s mark. 12 B. Intent of the Defendants The proper focus under this factor “is whether defe ndant had the intent to derive benefit from the reputation or goodwill of plaintiff.” Jordache Enters., Inc. v. Hogg Wyld, Ltd. , 828 F.2d 1482, 1485 (10th Cir. 1987) (internal qu otation marks and citation omitted); accord Universal Money Ctrs. , 22 F.3d at 1532. Plaintiff argues that although it has no direct evi dence of bad intent, a jury could infer defendants’ intent to derive the benefit and goodwill of KOM’s mark because they failed to conduct a full trademark sea rch before using the phrase “king of the mountain.” We disagree. As the distr ict court noted, “Plaintiff has presented no evidence to suggest that the defendant s were even aware of plaintiff’s existence, let alone that they intentio nally attempted to trade on plaintiff’s reputation or goodwill.” King of the Mountain Sports , 968 F. Supp. at 574. Instead, uncontested evidence indicates: (1) defendants did not know of plaintiff or its tra demarks when they designed their logo; (2) defendants knew that no other competitor in the ski-race industry used the term “King of the Mo untain;” and (3)13

defendants incorporated the phrase “King of the Mou ntain” to describe the goal of the ski racers competing in th e event – to be the “king of the mountain” in downhill ski racing. Id. Because the undisputed “evidence indicates [that the] defendant[s] did not intend to derive benefits from . . . plaintiff’s ex isting mark, this factor weighs against the likelihood of confusion.” Heartsprings , 143 F.3d at 556; accord First Sav. Bank , 101 F.3d at 655. C. Similarity in Products/Services and Manner of M arketing Typically, “[t]he greater the similarity between th e products and services, the greater the likelihood of confusion.” Universal Money Ctrs. , 22 F.3d at 1532 (internal quotation marks and citations omitted). This is undoubtedly true when the action pertains to source or affiliation confusion. For example, Beer Nuts, Inc. v. Clover Club Foods Co. , 805 F.2d 920, 926 (10th Cir. 1986) involved two competing companies marketing very similar goods – sweetened salted peanuts – in the same manner. In that case, we found that th is factor added strength to the position that a reasonable consumer would likely be confused as to the source of the peanuts. See id. However, in a case involving pure sponsorship con fusion, the parties may have little similarity in their pro ducts or manner of marketing. Here, KOM’s clothing is only marginally related to defendant’s ski event. This disconnection greatly reduces the relevance of the similarity of products factor. We therefore find it provides no support of plainti ff’s claim.14

D. Degree of Care Exercised by Purchasers “A consumer exercising a high degree of care in sel ecting a product reduces the likelihood of confusing similar trade names.” Heartsprings , 143 F.3d at 557. Plaintiff argues, however, that this factor rarely reduces the risk of sponsorship confusion. We agree. The harm plaintiff seeks to remedy in this case is loss of reputation and goodwill stemming from its perceivedsponsorship of the ski event. The care with which consumers select a product does not impact the association they may make regarding the sponsorship of an event . Therefore, even if plaintiff’s current and potential customers exercis e a high degree of care, it would have little impact on our determination regarding l ikelihood of confusion in this

case. E. Actual Confusion Although plaintiff need not set forth evidence of a ctual confusion to prevail in a trademark infringement action, see Beer Nuts, Inc. v. Clover Club Foods Co. , 805 F.2d 920, 928 (10th Cir. 1986), “[a]ctual confu sion in the marketplace is often considered the best evidence of likelihood of confusion.” Universal Money
Ctrs. , 22 F.3d at 1534; accord Jordache , 828 F.2d at 1487. However, “isolated instances of actual confusion [may] be de minimis.” Universal Money Ctrs. , 22 F.3d at 1535; see also McCarthy, supra , § 23:14 (“Evidence of actual confusion of a very limited scope may be dismissed as de minimis : Probable confusion cannot15

be shown by pointing out that at someplace, at some time, someone made a false identification.” (internal quotation marks omitted) ). “De minimis evidence of actual confusion does not establish the existence o f a genuine issue of material fact regarding the likelihood of confusion.” Universal Money Ctrs. , 22 F.3d at 1535. After carefully reviewing the record, we hav e found that plaintiff has put into evidence, at most, only seven examples of actu al confusion. This handful of anecdotal evidence is de minimis and does not suppo rt a finding of a genuine issue of material fact as to the likelihood of conf usion, especially in light of the complete lack of similarity between the defendants’ uses and plaintiff’s mark.
See id. at 1535-36 (“The de minimis evidence of actual con fusion is especially undermined in this case by the sheer lack of similarity between the marks.”). F. Strength of Plaintiff’s Mark The stronger a trademark, the more likely that encr oachment upon it will lead to sponsorship confusion. See First Sav. Bank , 101 F.3d at 653. “A strong trademark is one that is rarely used by parties oth er than the owner of the trademark, while a weak trademark is one that is often used by other parties.” Id. (internal quotation marks and citation omitted). T o assess the relative strength of a mark, one must consider the two aspects of streng th: (1) “Conceptual Strength: the placement of the mark on the [distinctiveness o r fanciful-suggestivedescriptive] spectrum;” and (2) “Commercial Strength: the marketplace16

recognition value of the mark.” McCarthy , supra , § 11:83. Under the conceptual strength prong, the categories , in descending order of strength, are: fanciful; arbitrary; suggestive; descriptive; and generic. See id. § 11:1; see also Heartsprings , 143 F.3d at 555. “‘Fanciful’ marks consist of ‘coined’ words that have been invented or selected for the sole purpose of functioning as a trademark.” McCarthy , supra , § 11:5. “Arbitrary marks comprise those words, symbols, pictures, etc., thatare in common linguistic use but which, when used with the goods or services in issue, neither suggest nor describe any ingredient, quality or characteristic of those goods or services.” Id. § 11:11. Suggestive marks are those that suggest s ome quality or ingredient of the goods. See id. § 11.62. Often the line between arbitrary and sug gestive is difficult to distinguish, see id. § 11:12, but for our purposes, no reason exists to make the distinction. Viewed in the light most favo rable to plaintiff, its stylized mark is at least suggestive on the conceptual stren gth spectrum. Moreover, again drawing all inferences in favor of plaintiff, we as sume that the mark has great commercial strength in the hunting apparel market. Therefore, plaintiff’s mark is quite strong. The strength of plaintiff’s mark cannot outweigh th e other factors, however. Given the great dissimilarity between its mark as a whole and the ways in which defendants have used the phrase, “king of the mountain,” as well as our17

above analysis of the other factors, we find that n o reasonable juror could find likelihood of confusion between plaintiff’s and def endants’ marks. Accordingly, we hold that there exists no genuine issue of mater ial fact as to the likelihood of confusion.
III. Conclusion In sum, after reviewing the evidence in the light m ost favorable to plaintiff, we conclude as a matter of law that no likelihood o f confusion exists. We AFFIRM the district court’s grant of summary judgme nt as to the trademark infringement issue raised on appeal.