Opinion ID: 151187
Heading Depth: 2
Heading Rank: 2

Heading: Whether the SensoryEffects Name is Likely to Cause Confusion

Text: Sensient next challenges the district court's grant of summary judgment on the SensoryEffects Flavor Systems mark. The district court held the SensoryEffects mark was not likely to cause confusion to customers. [3] The Eighth Circuit applies a six-factor test to determine whether there is a likelihood of confusion, no part of which is dispositive standing alone: (1) the strength of the owner's mark; (2) the similarity between the owner's mark and the alleged infringer's mark; (3) the degree to which the products compete with each other; (4) the alleged infringer's intent to `pass off' its goods as those of the trademark owner; (5) incidents of actual confusion; and, (6) the type of product, its cost, and conditions of purchase. Frosty Treats, 426 F.3d at 1008. We do not apply any mathematical formula in analyzing these factors; rather, we use them at the summary judgment stage as a guide to determine whether a reasonable jury could find a likelihood of confusion. Id. We address each of these factors separately.
In analyzing the first factor, we have recognized a strong and distinctive trademark is entitled to greater protection than a weak or commonplace one. Id. (citing SquirtCo. v. Seven-Up Co., 628 F.2d 1086, 1091 (8th Cir.1980)). Marks may be characterized in four categories: generic, descriptive, suggestive, or arbitrary or fanciful. Id. at 1004. On this spectrum, an arbitrary or fanciful mark is entitled to the highest level of protection, while a generic mark is afforded no trademark protection. Duluth News-Tribune, a Div. of Nw. Publ'n, Inc. v. Mesabi Pub. Co., 84 F.3d 1093, 1096 (8th Cir.1996). In this case, the district court determined Sensient was a fanciful word coined to function as a trademark for the company. As a result, the court acknowledged Sensient's mark was entitled to the broadest protection. However, the court also concluded Sensient could not claim an exclusive right to the Flavors portion of the Sensient Flavors name because Flavors is a generic term. Accordingly, the court determined only the Sensient name was entitled to protection. On appeal, Sensient agrees Flavors alone is not protectable, but it argues the Sensient Flavors mark must be construed as a whole. SensoryEffects asserts courts have routinely refused to protect generic portions of a trademark. In making its determination, the district court noted SensoryEffects did not object to its finding that the Sensient name was fanciful. Generally, we do not consider arguments raised for the first time on appeal and a party may not assert arguments not presented to the district court. Cole v. Intern. Union, United Auto., Aerospace & Agr. Implement Workers of Am., 533 F.3d 932, 936 (8th Cir.2008). In light of SensoryEffects' concession before the district court on this point, we need not consider its arguments on appeal challenging the strength of Sensient Flavors' name. Similarly, Sensient's argument questioning whether the district court properly analyzed its mark is largely irrelevant because the court ultimately found in favor of Sensient on the first factor. More importantly, the district court proceeded to compare the composite Sensient Flavors mark to the SensoryEffects mark later in its analysis, as demonstrated below. See, e.g., Sensient Tech. Corp. v. SensoryEffects Flavor Co., 636 F.Supp.2d 891, 900 (E.D.Mo.2009) (SensoryEffects Flavor Systems sounds different than Sensient Flavors.). Thus, the district court did not err in concluding the first factor favors Sensient.
Under the second step, we must consider the similarity between the Sensient Flavors and SensoryEffects Flavor Systems marks. Frosty Treats, 426 F.3d at 1008. Rather than consider the similarities between the component parts of the marks, we must evaluate the impression that each mark in its entirety is likely to have on a purchaser exercising the attention usually given by purchasers of such products. Duluth News-Tribune, 84 F.3d at 1097. The use of identical, even dominant, words in common does not automatically mean that two marks are similar. Gen. Mills, Inc. v. Kellogg Co., 824 F.2d 622, 627 (8th Cir.1987). We may consider the marks' visual, aural, and definitional attributes and compare the trade dress of the products in determining whether the total effect conveyed by the two marks is confusingly similar. Luigino's, Inc. v. Stouffer Corp., 170 F.3d 827, 830 (8th Cir.1999) (citing Gen. Mills, 824 F.2d at 627). The district court analyzed the evidence submitted by the parties related to the sophistication of the customer base and the collaborative process by which the products in the industry are sold. As a result of the sophisticated customers and the long, interactive purchasing process, the court determined it was highly unlikely buyers would confuse the marks, and thus the likelihood of confusion was diminished. The court also noted there was a distinct auditory difference between the marks. The court rejected Sensient's initial interest confusion argument, in which it contended SensoryEffects was able to use Sensient's name to gain access to customers and begin the collaborative process leading to sales, even if the customer's initial confusion over the two companies' names dissipates during the process. The court noted this theory has never been adopted by the Eighth Circuit, and even if it was, Sensient would still lose because it failed to show any evidence of customers experiencing such a phenomenon. Not only did SensoryEffects Flavor Systems have a distinct auditory difference from Sensient Flavors, the court held, but Sensient failed to introduce evidence showing SensoryEffects attempted to lure away Sensient's customer base by passing off its products as Sensient's. On appeal, Sensient contends the district court correctly recited the sight, sound, and meaning test to determine the similarity between the marks, see id., but it erroneously considered the purchasing conditions and evidence of actual confusion in assessing the similarity of the marks. Sensient asserts the court must independently determine whether the marks appear and sound similar and evoke a similar meaning, and then separately consider whether the purchasing conditions make those similarities more or less critical. Sensient also urges this court to formally adopt the initial interest confusion doctrine. We first consider the sight, sound, and meaning argument. We have continually held the use of identical dominant words does not automatically equate to similarity between marks. See Frosty Treats, Inc., 426 F.3d at 1008-09 (distinguishing the words frosty treats in the defendant's product from the plaintiff's Frosty Treats mark where the mark and trade dress were visually distinct); Luigino's, 170 F.3d at 830-31 (concluding Lean Cuisine and Lean `N Tasty are not confusingly similar); Duluth News-Tribune, 84 F.3d at 1097 (determining Duluth News-Tribune and Saturday Daily News & Tribune were distinct, despite the aural similarity between the two marks); Gen. Mills, 824 F.2d at 627 (holding the district court did not err in finding no confusing similarity between Oatmeal Raisin Crisp and Apple Raisin Crisp because the marks were different enough to avoid customer confusion). In this case, while each mark uses the word flavors and begins with the sens prefix, these features are components of longer product names with different auditory and visual depictions. See Everest Capital Ltd., 393 F.3d at 761 (Though each mark uses the dominant word `Everest,' that word is part of longer product names that employ different fonts and graphics.). First, there are significant visual differences between the marks. Sensient's mark consists of blue capital lettering with a yellow wave slightly above the lettering. The SensoryEffects mark, on the other hand, utilizes bold black lettering in different typeface on two lines, with a multicolor swirl symbol to the left of the first line. Based on these visual distinctions, the marks are sufficiently differentiated to prevent customer confusion. See Luigino's, 170 F.3d at 831 (The use of different colors and typefaces, as well as the prominent display of the house marks convey perceptible distinctions between the products.). In its reply brief, Sensient contends the visual appearance of the marks is irrelevant because the point of contact between the companies and the customers generally occurs via telephone, and thus the auditory similarities should be given priority. Sensient's suggestion to place particular emphasis on the verbal effect of the marks is not without merit. See 4 McCarthy § 23:22 (4th ed.) (Similarity of sound may be particularly important when the goods are of the type frequently purchased by verbal order.). However, we agree with the district court that the composite marks maintain a distinct auditory difference. See Duluth News-Tribune, 84 F.3d at 1097 (Although the [Duluth News-Tribune and Saturday Daily News & Tribune] marks are aurally similar, when pronounced in their entirety the word `Saturday' and the ampersand in defendants' paper make the two distinguishable.). While Sensient correctly notes the purchasing conditions, confusion among customers, and similarity between the marks are three separate factors considered by the court in its analysis, our precedent is clear that we evaluate the impression the entire mark is likely to have on a purchaser exercising the attention usually given by purchasers of such products. Id. See also Luigino's, 170 F.3d at 830-31 (analyzing whether an ordinary consumer would be likely to be confused between the two marks). The parties agree the ordinary customer of their products is sophisticated and any particular sale is the result of a long, collaborative process. Taking into consideration the sophistication of the customers and the nature of the purchasing process, the district court correctly determined the ordinary consumer would not find the marks confusingly similar under the sight, sound, and meaning test. Sensient further argues the district court erred in its application of the initial interest confusion doctrine. According to Sensient, most courts now recognize the doctrine, which arises when confusion creates an initial customer interest, even though no actual sale may be finally completed due to the confusion. 4 McCarthy § 23:6 (4th ed.). Sensient contends the doctrine may be applied to a purchasing process that is drawn out over a period of time, such as the collaborative buying process at issue here. Id. However, those courts acknowledging the doctrine recognize that [e]ven if the marks are almost identical, initial interest confusion is not assumed and must be proven by the evidence. Id. We decline Sensient's invitation to adopt the initial interest confusion doctrine in this case because, even if the doctrine applied generally in this circuit, it would not apply in this case. Under the doctrine, courts look to factors such as product relatedness and the level of care exercised by customers to determine whether initial interest confusion exists. Checkpoint Sys., Inc. v. Check Point Software Techs., Inc., 269 F.3d 270, 296 (3d Cir.2001). Here, although the products are similar, the parties agree the customers are sophisticated and exercise a relatively high degree of care in making their purchasing decisions. This sophistication makes it less likely customers will experience initial confusion, ultimately resulting in a benefit to the alleged infringer. Id. at 296-97. As a result, the district court correctly rejected the application of the doctrine under these facts. In sum, the district court did not err in concluding the second factor weighs in favor of SensoryEffects.
The third factor analyzes the degree of competition between products. Frosty Treats, 426 F.3d at 1008. If the two companies' products are closely related, confusion among customers is more likely. Davis v. Walt Disney Co., 430 F.3d 901, 904 (8th Cir.2005). The district court determined the companies' product markets differ slightly, but it ultimately held this factor weighed in favor of Sensient because the parties are direct competitors selling flavor delivery systems to food and food ingredient companies. Neither party disputes this holding on appeal, and accordingly we conclude the district court was correct in its determination under the third factor, which favors Sensient.
The fourth factor analyzes whether the alleged infringer intended to pass off its goods as the trademark owner's goods. Frosty Treats, 426 F.3d at 1008. While proof of bad intent is not required for success in an infringement or unfair competition claim, the absence of such intent is a factor to be considered. Id. Knowledge of another's product and an intent to compete with that product is not ... equivalent to an intent by a new entrant to a market to mislead and to cause consumer confusion. Luigino's, 170 F.3d at 831. In considering this factor, the district court first acknowledged the temporary restraining order it previously entered against SensoryFlavors, in which it noted Nicolais's selection of the SensoryFlavors name after he was previously employed by Sensient created a strong inference of his intent to confuse the public. However, the court concluded the evidence produced after additional discovery did not support this inference because Nicolais worked for a separate division while he was employed by Sensient, and even if he maintained knowledge of the Sensient Flavors name, his knowledge did not equate with an intent to mislead. Rather, the court determined SensoryEffects selected its name in order to capitalize its already-established mark and the goodwill established under the Givaudan Flavors name. Sensient asserts the court ignored evidence demonstrating SensoryEffects was aware Sensient was a direct competitor prior to purchasing Givaudan Flavors and it intentionally selected similar marks. Instead, Sensient argues the court relied on the self-serving affidavit of Nicolais, who claimed he was unaware of the Sensient Flavors mark. Sensient also argues SensoryEffects was obligated to move further away from the Sensient Flavors name after the temporary restraining order was entered, such that inserting Effects was insufficient to meet its obligation. In determining whether SensoryEffects intended to pass off its goods as those of Sensient's, we believe the analysis in Luigino's is instructive. In Luigino's, the owners of the Lean Cuisine mark alleged that Luigino's intentionally adopted a similar mark, Lean `N Tasty, to capitalize on the goodwill established under the Lean Cuisine mark. Id. The evidence before the court demonstrated that Luigino's rejected a consultant's advice to avoid the Lean `N Tasty mark and it believed the low-fat Lean `N Tasty entrees might be comparable to Lean Cuisine entrees. Id. Despite this evidence, this court determined there was no evidence Luigino's intended to capitalize on the strong Lean Cuisine mark. Id. The court explained that Luigino's chose the name Lean `N Tasty because it wanted to avoid the word light, it believed the word low-fat was overused, and because it did not agree with the consultant's recommendation to avoid the word lean. Id. According to the court, the reference to Lean Cuisine only evinced an intent to compete with the product, not an intent to infringe on the mark. Id. As a result, the court held there was no genuine issue of material fact regarding predatory intent. Id. Similarly, in General Mills, Inc., this court declined to find predatory intent on the part of the owner of the Oatmeal Raisin Crisp mark, despite the owner's intent to compete with the Apple Raisin Crisp mark. 824 F.2d at 627. Oatmeal Raisin Crisp went so far as to send promotional fliers to distributors encouraging them to replace Apple Raisin Crisp with its product. Id. However, the court again concluded that knowledge of another's product and an intent to compete with that product does not equate to predatory intent. Id. We believe the intent alleged by Sensient in this case is similar to the allegations in Luigino's and General Mills, Inc. While the parties strongly dispute the extent of Nicolais's knowledge of the Sensient Flavors name, our precedent demonstrates any knowledge maintained by Nicolais is not dispositive of the inquiry because knowledge of another's product and an intent to compete does not correspond with an intent to mislead. Id. Sensient alleges the inference to be drawn from the evidence is that Nicolais had an intent to confuse customers by using a name similar to Sensient Flavors; however, there is no support in the record for this assertion other than speculation. Rather, the facts of this case are similar to Duluth News-Tribune, where the court recognized the allegedly infringing name Saturday Daily News & Tribune was a logical merger of the names Daily News and Daily Tribune. 84 F.3d at 1097. Here, the prior owners of SensoryEffects filed an application for registration of the SensoryEffects name and graphic in July 2004, which was formally registered by the PTO on July 3, 2007. After PCI acquired Givaudan Flavors, it was not permitted to use the Givaudan Flavors name for more than sixty days after the purchase. As a result, the company decided to combine the SensoryEffects and Givaudan Flavors names to form SensoryFlavors. After this lawsuit was filed, the company changed its name to SensoryEffects Flavor Systems, incorporating the full SensoryEffects name that was already registered with the PTO. Under these circumstances, the district court was not incorrect in concluding the SensoryEffects Flavor Systems name was a logical combination of the previously-established SensoryEffects and Givaudan Flavors names. After a careful review of the record, we conclude no reasonable jury could find in favor of Sensient on the fourth factor.
Under the fifth factor, we examine the incidents of actual confusion. Frosty Treats, 426 F.3d at 1008. Although such incidents are proof of the likelihood of confusion, the plaintiff is not required to bring forth incidents of actual confusion to succeed in an infringement case. Squirt-Co., 628 F.2d at 1091. In analyzing this factor, weight is given to the number and extent of instances of actual confusion. Duluth News-Tribune, 84 F.3d at 1098. The district court held Sensient failed to produce any evidence of actual confusion, which it noted was telling since the SensoryEffects name had been in use at the time for approximately one year. As a result, the court concluded the fifth factor weighed in favor of SensoryEffects. Sensient contends it presented evidence detailing some customers' misguided beliefs in phone calls and correspondence where the customers thought SensoryFlavors was, in one way or another, Sensient Flavors. SensoryEffects responds Kenneth Iwanusa, National Sales Manager for Sensient Flavors, testified he knew of no lost sales, no injury to Sensient's reputation, and no incidents in which SensoryEffects benefitted from any confusion between the two companies. As an initial matter, it is questionable whether the statements contained in Sensient's interrogatory responses purportedly establishing the customers' confusion are admissible. See id. (In evaluating the evidence at the summary judgment stage, we consider only those responses that are supported by admissible evidence.). We need not answer this question, however, because assuming the statements are admissible, it is clear even several isolated incidents of actual confusion that occur initially upon the creation of a potentially confusing mark are insufficient to establish a genuine issue of material fact as to the likelihood of confusion. Id. Instead, we look to whether an appreciable number of ordinary purchasers are likely to be so misled. Id. at 1099. This is not the case here, because the incidents described by Sensient show only negligible confusion after SensoryFlavors was completing its transition with Givaudan Flavors, which is insufficient to meet the burden under the fifth factor. More importantly, the district court correctly noted the alleged incidents of confusion all related to the SensoryFlavors name, not the SensoryEffects name at issue here. Sensient concedes this fact on appeal, but notes there still may be a likelihood of confusion. Sensient's suggestion is without any support in the record, and as a result, no reasonable factfinder could determine the fifth factor favors Sensient. Therefore, the district court did not err in concluding the fifth factor favors SensoryEffects.
Finally, the sixth factor examines the conditions of purchase and the degree of care expected of customers. Frosty Treats, 426 F.3d at 1008. In considering this factor, we must stand in the shoes of the ordinary purchaser, buying under the normally prevalent conditions of the market and giving the attention such purchasers usually give in buying that class of goods. Luigino's, 170 F.3d at 831. This factor is more important in confusion-of-source cases where the degree of care that the purchaser exercises in purchasing a product can eliminate the confusion that might otherwise exist. Frosty Treats, Inc., 426 F.3d at 1010. In this case, the district court concluded it was well-established the parties sell their products to sophisticated customers after a collaborative process. As a result of this process, the court held the likelihood of confusion was diminished, and this factor favored SensoryEffects. The parties do not dispute the conditions of purchase on appeal, as each concedes they are competitors with sophisticated customers. As noted in the analysis above, this factor is important in this case because it tends to mitigate any potential confusion. Id. As a result of the parties' agreement, this factor could not form the basis for a verdict in favor of Sensient, and the district court did not err in concluding this factor weighs in favor of SensoryEffects.