Opinion ID: 74089
Heading Depth: 2
Heading Rank: 2

Heading: Hi-Seas Assignment

Text: 14 For example, when a retail customer in a grocery store sees a pile of raw shrimp at the fish counter, with no brand name at all, there is little likelihood that such end user would confuse the source or sponsorship of the raw shrimp with that of CBI’s packaged seafood gumbo or shrimp cakes (bearing the CARNIVAL mark) even though located in another part of the same store. On the other hand, depending upon factors not yet analyzed by the district court, there may be a likelihood of confusion at the level of the retailers or wholesalers who purchased Mariscos’ shrimp in boxes bearing the name CARNIVAL, and who were also in the market buying CBI’s products bearing the same CARNIVAL mark. 19 Second, plaintiff CBSC may have obtained rights in the CARNIVAL mark through the Hi-Seas Assignment. Because CBSC stepped into Hi-Seas’ shoes, CBSC’s priority depends on the priority as between Hi-Seas and CBI. Hi-Seas began using the CARNIVAL mark in June 1992 for fresh frozen shrimp, cooked shrimp, breaded shrimp, cooked crawfish, and breaded alligator. At that time, CBI had been operating since 1990 as an unincorporated sole proprietorship, and had been selling chicken gumbo and seafood gumbo. However, at that time, CBI had not yet expanded into other processed seafood products.15 Because CBI was using the CARNIVAL mark before Hi-Seas with respect to a different good, priority as between CBI and Hi-Seas turns on the same “natural expansion” concept that was explored supra in the context of Mariscos’ priority and the Mariscos Assignment. That is, CBI is unquestionably the senior user with respect to seafood and chicken gumbo. The senior user’s, i.e., CBI’s, priority “may extend into uses in ‘related’ product or service markets,” i.e., the market for the products sold by Hi-Seas, because a trademark owner has protection “against the use of its mark on any product or service which would reasonable be thought by the buying public to come from the same source, or thought to be affiliated with, connected with, or 15 CBI expanded into other processed seafood products, in particular shrimp cakes, crawfish cakes, lobster cakes, and crab cakes, in December 1992. 20 sponsored by, the trademark owner.” Tally-Ho, 889 F.2d at 1023 (internal quotation marks omitted). If Hi-Seas’ product was one into which CBI could have naturally expanded, then CBI could have enjoined Hi-Seas at that time, and CBI would have priority. The issue is whether -- when Hi-Seas started using the CARNIVAL mark in June 1992 for fresh frozen shrimp, cooked shrimp, breaded shrimp, cooked crawfish, and breaded alligator -- there was a likelihood of confusion as between HiSeas’ products and CBI’s seafood gumbo which had been sold under the CARNIVAL mark since 1990. The existence of such likelihood of confusion, in turn, is determined by applying the familiar seven-factor test to Hi-Seas and CBI as of June 1992. The district court disregarded the Hi-Seas Assignment on the ground that “[a]ny rights received by Plaintiff via the assignment are legally insignificant . . . because [the record] indicates that Hi-Seas’ rights to the mark extended back only to June 10, 1992 . . . . [and] [h]aving used the ‘Carnival’ mark since 1990 in connection with the manufacture and sale of seafood gumbo and chicken gumbo, the Defendant’s rights in the mark are senior to those assigned by Hi-Seas to the Plaintiff.” District Court Order at 8 n.4. This ruling implicitly assumes that the natural expansion or related goods doctrine operated to extend CBI’s priority from the seafood gumbo market to the market for the products sold by Hi-Seas. However, there is nothing in the district court’s order to suggest that it applied the seven-factor test in analyzing this question, 21 as directed by Tally-Ho, and we are not inclined to do so for the first time on appeal. Thus, on remand, the district court should conduct further proceedings, e.g., perform the proper analysis to decide whether there is any genuine issue of material fact as to whether the priority generated by CBI’s senior use extended to give CBI priority in the use of the CARNIVAL mark in connection with the products sold by Hi-Seas.