Opinion ID: 691965
Heading Depth: 3
Heading Rank: 5

Heading: Defendant's Intent (Scott Factor 5)

Text: 66 The fifth Scott factor is the intent of the defendant in adopting the mark. Whatever merit this factor may have in the context of trademark and product packaging trade dress cases, we doubt that it is an appropriate consideration in a trade dress infringement case where the trade dress is alleged in the product configuration itself. In the likelihood of confusion inquiry in trademark cases and product packaging trade dress cases, we do not focus on a defendant's bare intent to adopt a mark or product packaging substantially identical to a plaintiff's mark or packaging, since there is little basis in fact or logic for supposing from a defendant's intent to copy (without more) that the defendant's actions will in fact result in confusion. Thus, what we have held is that a defendant's intent to confuse or deceive consumers as to the product's source may be highly probative of likelihood of confusion. See American Home Prods. v. Barr Lab., Inc., 834 F.2d 368, 371 (3d Cir.1987) (product packaging case--color of pain relief medication); see also Fisons Horticulture, Inc., 30 F.3d at 479-80 (identifying intent of promoting confusion and appropriating the prior user's good will as appropriate inquiry in forward confusion cases) (internal quotation marks omitted) (trademark case--marks Fairway and Fairway Green); Sands, Taylor & Wood Co. v. Quaker Oats Co., 978 F.2d 947, 960 (7th Cir.1992) ([T]he defendant's intent is relevant to the issue of likelihood of confusion only if he intended to palm off his products as those of another. (internal quotation marks omitted) (trademark case--words Thirst Aid used in advertising campaign)); First Brands Corp. v. Fred Meyer, Inc., 809 F.2d 1378, 1385 (9th Cir.1987) (Intent of a defendant in adopting his trade dress is a critical factor, since if the trade dress were adopted with the intent of depriving benefit from the reputation of the plaintiff, that fact alone may be sufficient to justify the inference that there is a confusing similarity.) (emphasis supplied) (product packaging case--color and shape of antifreeze jug). 67 Because American Home Products involved a claim that the color of a rival producer's ibuprofen tablet infringed the trade dress of the plaintiff's Advil tablet, we believe that the case is closer to a product packaging case than a product configuration case. Even were we to consider it a product configuration case, however, American Home Products is consistent with our present discussion of defendant's intent. Judge Seitz's opinion did not hold that independent significance must be accorded a defendant's mere intent to copy; rather, it held that intent to confuse might be highly probative of likelihood of confusion and that [a]t most, defendant's intent is a factor tending to suggest likelihood of confusion. American Home Prods., Inc., 834 F.2d at 371 (emphases supplied). In what follows, we simply clarify this circuit's intent-to-confuse rule for product configuration cases, delineating the circumstances under which a defendant's intent to confuse or deceive consumers may be considered a factor in the likelihood of confusion inquiry. 68 We realize that some courts have adopted a broader rule holding that a defendant's intent to copy strongly supports an inference of likelihood of confusion. See, e.g., Bauer Lamp Co. v. Shaffer, 941 F.2d 1165, 1172 (11th Cir.1991); Mobil Oil Corp. v. Pegasus Petroleum Corp., 818 F.2d 254, 258 (2d Cir.1987). Like the intent-to-confuse rule, this intent-to-copy rule relies essentially on a (rebuttable) presumption of efficacy--although the intent-to-copy rule requires a double inference, see, e.g., Perfect Fit Indus., Inc. v. Acme Quilting Co., 618 F.2d 950, 954 (2d Cir.1980) (If there was intentional copying the second comer will be presumed to have intended to create a confusing similarity of appearance and will be presumed to have succeeded.)--since the defendant's intent standing alone (without reference to the defendant's competence and the nature of the defendant's actions) reveals little about the probable outcome of the defendant's conduct. 13 69 The justification for these inferences in a trademark or product packaging case is that there is little or no competitive need to copy another's distinctive symbol or presentation to sell one's product, and that anyone who does so is most likely trying to cash in on the competitor's goodwill attached to the competitor's mark or packaging in order to sell his or her own product. See, e.g., 2 MCCARTHY, TRADEMARKS AND UNFAIR COMPETITION Sec. 23.33 ([W]e can readily read into defendant's choice of a confusingly similar mark the intent to get a free ride upon the reputation of a well known mark.). This presumption largely duplicates the weight given to the substantial-identity-of-appearance factor (Scott factor 1) in the likelihood of confusion inquiry, and the extra weight assigned to the intent to deceive is somewhat punitive. Cf. 2 MCCARTHY, TRADEMARKS AND UNFAIR COMPETITION Sec. 23.32 (Where there is hard evidence of defendant's intention to get a free ride on plaintiff's reputation, the court is free to engage in the traditional rhetoric which accompanies punishing the evildoer[.]). 70 Although these two types of inference from defendant's intent do not directly serve the purpose of preventing consumer confusion or misappropriation of a producer's goodwill--either of which might arise from good faith or bad faith actions--the inferences may serve as a deterrent to infringement. But where product configurations are concerned, we believe there is little room for deterrence if appropriate labeling and marketing are undertaken. 71 One primary purpose of the Lanham Act is to foster fair competition. See, e.g., Merchant & Evans, Inc., 963 F.2d at 640 n. 13 (citing Park 'N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S. 189, 193, 105 S.Ct. 658, 661, 83 L.Ed.2d 582 (1985), and Jay Dratler, Jr., Trademark Protection for Industrial Designs, 1988 U.ILL.L.REV. 887, 926 n. 10). Indeed, we have said that prevention of unfair competition is the doctrinal basis for trade dress infringement suits under the Act. American Greetings Corp., Inc., 807 F.2d at 1140-41 & n. 2. Where product configurations are concerned, we must be especially wary of undermining competition. Competitors have broad rights to copy successful product designs when those designs are not protected by (utility or design) patents. It is not unfair competition for someone to trade off the good will of a product, see Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 121, 59 S.Ct. 109, 115, 83 L.Ed. 73 (1938); it is only unfair to deceive consumers as to the origin of one's goods and thereby trade off the good will of a prior producer. See also Duraco, 40 F.3d at 1445. 72 Unless very narrowly tailored, deterrents to copying of product designs--as opposed to product packaging or trademarks--would inhibit even fair competition, thus distorting the Lanham Act's purpose. We believe that the best way to further Congress's intent is to limit carefully the scope of any possible deterrence of competition. Cf. Merchant & Evans, Inc., 963 F.2d at 640 ([C]ourts should tailor trademark remedies to decrease the likelihood of confusion without unnecessarily inhibiting competition.). Recognizing that trademark and trade dress cases on one hand and patent cases on the other do not involve identical considerations, we nevertheless turn for guidance in this task to patent cases concerning defendants' intent, for, as we have noted, we must decide product configuration cases so as to harmonize them with the federal patent laws. See supra at 204-05. 73 In patent infringement cases, a defendant's bad intent is relevant in at least two contexts. First, under the doctrine of inequitable conduct, infringement claims may be rendered unenforceable if a plaintiff intended to deceive the Patent Office by failing to disclose material evidence. See, e.g., Braun, Inc. v. Dynamics Corp. of America, 975 F.2d 815, 822 (Fed.Cir.1992); Allen Organ Co. v. Kimball Int'l, Inc., 839 F.2d 1556, 1567-68 (Fed.Cir.1988). Second, a plaintiff may receive increased damages where a defendant willfully infringed its patent. See, e.g., Braun, Inc., 975 F.2d at 822; E.I. du Pont de Nemours & Co. v. Phillips Petroleum Co., 849 F.2d 1430, 1440 (Fed.Cir.1988). In either case, however, the plaintiff must prove by clear and convincing evidence that the defendant had the relevant bad intent. See, e.g., Braun, Inc., 975 F.2d at 822 (intent to deceive Patent Office and willful infringement); Allen Organ Co., 839 F.2d at 1567 (intent to deceive Patent Office); E.I. du Pont de Nemours & Co., 849 F.2d at 1440 (willful infringement). Although in the present context we are not dealing with increased damages or actions taken by the Patent Office, product configuration trade dress cases nonetheless implicate patent-like restrictions on competition. Like the doctrine of inequitable conduct, a heightened evidentiary standard would serve to ensure that deviations from the the federal policy ... of allowing free access to copy whatever the federal patent and copyright laws leave in the public domain, Compco Corp., 376 U.S. at 237, 84 S.Ct. at 782, are not casually countenanced. And much as the burden of proof for willful infringement assures that competitors are not penalized by increased damage awards without compelling evidence, we think it similarly important to competitors--as well as the public--that competition not be hobbled by monetary damages or injunctive prohibitions absent similarly compelling evidence. 74 Accordingly, for all the foregoing reasons, we hold that in the product configuration context, a defendant's intent weighs in favor of a finding of likelihood of confusion only if intent to confuse or deceive is demonstrated by clear and convincing evidence, and only where the product's labeling and marketing are also affirmatively misleading. Of course, a plaintiff might succeed in proving likelihood of confusion without evidence of affirmative deception. We only hold that, to be considered as evidence of a likelihood of confusion in a product configuration case, the defendant's intent must meet the conditions we have set forth. 75