Court Opinion

ID: 3000834
Source: CourtListenerOpinion
Date Created: 2015-09-24 20:09:45.182021+00
Date Added: 2024-06-11T11:45:42.938477
License: Public Domain

In the
 United States Court of Appeals
              For the Seventh Circuit
                       ____________

No. 06-3618
H-D MICHIGAN, INC. and
HARLEY-DAVIDSON MOTOR COMPANY, INC.,
                                      Plaintiffs-Appellants,
                             v.

TOP QUALITY SERVICE, INC,
                                        Defendant-Appellee.
                       ____________
         Appeal from the United States District Court
             for the Eastern District of Wisconsin.
        No. 04 C 0533—Charles N. Clevert, Jr., Judge.
                       ____________
    ARGUED MARCH 29, 2007—DECIDED AUGUST 2, 2007
                   ____________

 Before FLAUM, EVANS, and WILLIAMS, Circuit Judges.
  FLAUM, Circuit Judge. H-D Michigan, Inc. and Harley
Davidson Motor Co., Inc. (collectively, “Harley”) sued Top
Quality Service, Inc. (“Top Quality”), alleging trademark
infringement, false designation of origin, and unfair
competition claims under the Lanham Act, 15 U.S.C.
§ 1125(a), and state law. According to Harley’s complaint,
Top Quality’s use of the name, “HOGS ON THE HIGH
SEAS,” which it uses to advertise ocean cruises for motor-
cycle enthusiasts, infringes on two Harley trademarks—
“HOG” and “H.O.G.”—that Harley uses for its motor-
cyclist travel club, the Harely Owners Group. The district
2                                                   No. 06-3618

court granted summary judgment in Top Quality’s favor,
concluding that a Second Circuit decision collaterally
estopped Harley from bringing trademark claims premised
on its use of the word “hog” to refer to motorcycle products
or services. Harley appeals the district court’s ruling
granting Top Quality’s motion for summary judgment.
For the following reasons, we reverse and remand.

                       I. Background
  Harley is universally recognized as a manufacturer of
high quality motorcycles. In 1983, it established the
Harley Owners Group, a 700,000 member social club for
people who own Harley motorcycles. Buyers of Harley
motorcycles receive a free, one-year membership in the
Harley Owners Group, but they must pay annual dues or
buy a lifetime membership to remain in the club. Since
1998, the club has offered travel services to members
attending club-sponsored motorcycle rallies. The Federal
Patent and Trademark Office has issued Harley the
registered trademarks “HOG” and “H.O.G.” to refer to
its motorcyclist club.1
  Dean and Debbie Anderson are longtime Harley motorcy-
cle owners and members of the Shenandoah Valley Chap-
ter of the Harley Owners Group. In 2001, Dean Anderson
came up with an idea to sell a cruise to motorcyclists. He
was tired of attending traditional motorcycle rallies
because the weather was unpredictable and because
vendors charged inflated prices for food and lodging. He

1
   The Trademark Office issued the “HOG” mark after Harley
filed this suit. The parties do not discuss what legal effect
this may have on the burden of proof, see 15 U.S.C. 1115, and
we believe the issue, if raised, is one best resolved in the first
instance by the district court.
No. 06-3618                                             3

pitched the cruise idea to David Gray, Harley’s east coast
Harley Owners Group representative, but Gray said that
Harley would not be interested in sponsoring a cruise. The
Andersons continued to explore the possibility of offering
the cruise on their own and eventually incorporated Top
Quality as a means of selling their product. They decided
to name the cruise “HOGS ON THE HIGH SEAS”—a
catchy name that they believed captured the essence of
their product.
  In August 2002, the Andersons created the first adver-
tisement for their cruise. It said, “1st Annual Harley
Owners’ Cruise Rally” in large print immediately above a
circular logo that contained the words “HOGS ON THE
HIGH SEAS” and a cartoon pig riding a large motorcycle
on an ocean wave. Top Quality’s website said, “Bring
your Harley friends, HOG group members, riding bud-
dies, there won’t be a stranger on the ship.” Top Quality
advised potential vendors that the trip was an “all Harley
Owners Cruise Ship Rally.” Ninety-seven percent of the
passengers on the first cruise owned Harley motorcycles.
  Since November 2003, Top Quality has sponsored several
cruises in the Carribean and Alaska. Passengers are not
allowed to bring their motorcycles on the ship, but there
are vendors who display motorcycles and motorcycle-
related products and services. The cruises include enter-
tainment, contests, and excursions that are designed to
appeal to motorcycle enthusiasts.
  There is evidence that some of Top Quality’s potential
customers have been confused about whether the cruise is
sponsored by the Harley Owners Group. Shortly after it
was launched, Top Quality’s website posted a list of
Frequently Asked Questions that included, “Do I have to
be a HOG Member” and “Can I get on this Rally Cruise if
I don’t own a Harley Davidson Brand Bike.” In surveys
completed after the cruise, a number of passengers used
4                                              No. 06-3618

the word “hog” to refer to Top Quality’s passengers and
cruise-related events. Additionally, prospective customers
have referred to the cruise in their communication with
Top Quality as “hd cruise,” “Harley cruise,” and “HOG
cruise.” A consumer survey conducted by Harley’s expert
suggests that twenty-seven percent of motorcycle riders
who view Top Quality’s promotional materials believe
that Harley promotes or approves of Top Quality’s cruises.
The same survey suggests that much of this confusion
stems from Top Quality’s use of the word “hog” and the
word’s association with the Harley Owners Group.
  There is also evidence that Top Quality has attempted
to limit any such confusion. Its website currently dis-
claims association with Harley and the Harley Owners
Group, and it has printed similar statements on literature
that it distributes at motorcycle rallies. Top Quality’s
brochures also state that Dean and Debbie Anderson are
the owners of HOGS ON THE HIGH SEAS and that
they are “independent cruise consultants.”
   On January 31, 2003, Top Quality applied to register the
HOGS ON THE HIGH SEAS mark in connection with
“travel arrangements in the nature of cruises for motorcy-
cle owners and enthusiasts.” On January 23, 2004, Harley
filed an opposition proceeding against the application, and
on June 4, 2004, Harley filed the complaint in this case. It
alleged trademark infringement, false designation of
origin, and unfair competition claims under the Lanham
Act and state law. The parties filed cross-motions for
summary judgment, and the district court granted Top
Quality’s and denied Harley’s motion. It concluded that
a Second Circuit decision, Harley-Davidson, Inc. v.
Grottanelli, 164 F.3d 806 (2d Cir. 1999), which held
Harley’s “H.O.G.” mark generic, collaterally estopped
Harley from arguing that its “H.O.G.” mark was
protectable.
No. 06-3618                                                 5

  The district court said that Grottanelli “pertains to any
use of the word ‘hog,’ including the acronym ‘H.O.G.’ when
‘hog’ is used in relation to ‘motorcycle products or ser-
vices.’ ” H-D Michigan, Inc. v. Top Quality Service, Inc.,
No. 04 C 0533, 2006 WL 2547083, *3 (E.D. Wis. Aug. 31,
2006) (emphasis in original). The district court further
observed as follows:
    In holding that ‘hog’ is generic, the court did not single
    out the ‘H.O.G.’ mark as non-generic because it refers
    to people rather than motorcycles. To the contrary, it
    mentioned the ‘H.O.G.’ mark as part of Harley’s
    illegitimate efforts to exclude the term ‘hog’ from the
    generic pool . . . . Thus, the Grotanelli court was
    aware of (1) the ‘H.O.G.’ mark; and (2) that the acro-
    nym denoted members of Harley Owner’ [sic] Group
    rather than motorcycles. Nevertheless, the court made
    no distinction between Harley’s application of the term
    ‘hog’ to large motorcycles and to H.O.G. members.
Id. (internal citations omitted). With regard to Harley’s
unfair competition claim, the district court recognized that
a plaintiff using a generic name can succeed on such a
claim if the defendant has not adequately identified
itself as the source of its product. The court concluded,
however, that Top Quality had identified itself as the
source of its product by disclaiming any association with
Harley. Id. at *4-5. Harley appeals the district court’s
ruling on Top Quality’s motion for summary judgment.

                       II. Analysis
  The Court reviews the district court’s grant of summary
judgment de novo. “Summary judgment is appropriate
where the evidence in the record shows no genuine issue of
material fact and the moving party is entitled to judgment
as a matter of law.” Steen v. Myers, 486 F.3d 1017, 1021
(7th Cir. 2007). We take the facts in the light most favor-
6                                                 No. 06-3618

able to the non-moving party and draw all reasonable
inferences in its favor. See Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 255 (1986).
  “[T]o prove a claim pursuant to 15 U.S.C. § 1125(a), a
plaintiff must show (1) that its trademark may be pro-
tected and (2) that the relevant group of buyers is likely to
confuse the alleged infringer’s products or services with
those of plaintiff.” Forum Corp. of N. Am. v. Forum, Ltd.,
903 F.2d 434, 439 (7th Cir. 1990). Marks are either
fanciful, arbitrary, suggestive, descriptive, or generic. See
Bliss Salon Day Spa v. Bliss World LLC, 268 F.3d 494, 496
(7th Cir. 2001). “A generic term is one that is commonly
used as the name of a kind of goods.” Liquid Controls Corp.
v. Liquid Control Corp., 802 F.2d 934, 936 (7th Cir. 1986).
A descriptive term, by contrast, is one that names a
characteristic of a particular product or service. See J.
Thomas McCarthy, McCarthy on Trademarks and Unfair
Competition § 11:16 (4th ed. 2007).2 Generic and descrip-
tive marks ordinarily cannot function as trademarks, but
a descriptive mark may warrant protection if it has
acquired secondary meaning. See Custom Vehicles, Inc. v.
Forest River, Inc., 476 F.3d 481, 483 (7th Cir. 2007); Liquid
Controls Corp., 802 F.2d at 935. A descriptive mark
acquires secondary meaning if the product name comes “to
be uniquely associated with the original seller.” Custom
Vehicles, Inc., 476 F.3d at 483.
  A company’s name may be generic as to one of its
products, but not generic as to its other products, even
those related to the first product. See McCarthy, supra
at § 12:23. Two Second Circuit decisions illustrate this
principle. In one, the court, in a decision authored by

2
  For example, if an apple-seller names its company “APPLE,” its
name is generic. McCarthy, supra at § 12:1. If an apple-seller
names its product “TASTY,” its name is descriptive. Id. at
§ 11:18.
No. 06-3618                                                7

Judge Friendly, held that the word “safari” is generic as
applied to a type of khaki hat and jacket, but not generic
as applied to boots, shoes, shirts, ice chests, and tobacco.
See Abercrombie & Fitch Co. v. Hunting World Inc., 537
F.2d 4, 11-12 (2d Cir. 1976). In another, the court held that
the word “self-realization” is a generic name for a yoga
organization (people performing yoga attempt to attain
self-realization), but descriptive as applied to yoga books
and classes. See Self-Realization Fellowship Church v.
Ananda Church of Self-Realization, 59 F.3d 902, 909-10
(2d Cir. 1995).
  Top Quality argues that Grottanelli precludes Harley
from arguing that its “HOG” mark is protectable because
that case held that the “HOG” mark was generic. Harley
responds that Grottanelli only held that “HOG” was
generic as applied to large motorcycles, not to a motorcy-
clist club. It further argues that neither its use nor Top
Quality’s use of the word “hog” is generic and that a jury
reasonably could find that Top Quality’s mark likely
confused consumers.

    A. Collateral Estoppel
  For a ruling to have collateral estoppel effect, “four
elements must be met: ‘(1) the issue sought to be precluded
must be the same as that involved in the prior litigation,
(2) the issue must have been actually litigated, (3) the
determination of the issue must have been essential to
the final judgment, and (4) the party against whom
estoppel is invoked must be fully represented in the prior
action.’ ” Meyer v. Rigdon, 36 F.3d 1375, 1379 (7th Cir.
1994) (quoting La Preferida Inc. v. Cerveceria Modelo, S.A.
de C.V., 914 F.2d 900, 906 (7th Cir. 1990)). In this case,
the parties only dispute whether the issue litigated in
Grottanelli is the same as the one here. Harley contends
that the issues are different because in Grottanelli, the
8                                              No. 06-3618

Second Circuit evaluated whether the word “hog” was
generic as applied to large motorcycles, whereas in this
case, the issue is whether “hog” was generic as applied to
a motorcyclist club. Top Quality contends that Grottanelli
held that “hog” is generic as applied to all motorcycle
products and services, thus precluding Harley’s infringe-
ment claim.
  In Grottanelli, Harley sued Ronald Grottanelli under
New York’s anti-dilution statute, which, like the Lanham
Act, prevents a company from infringing on another’s
trademark. Grottanelli owned a motorcycle repair shop
called “The Hog Farm,” sponsored an event known as “Hog
Holidays,” and sold “Hog Wash” engine degreaser and a
“Hog Trivia” board game. After discussing the history and
meaning of the word “hog,” the Second Circuit held that
Harley’s use of the word was generic as applied to large
motorcycles. The court said that Harley’s use of the word
“hog” was not protectable because “hog” means large
motorcycle. The court explained that “[n]o manufacturer
can take out of the language a word, even a slang term,
that has generic meaning as to a category of products and
appropriate it for its own trademark use.” Grottanelli, 164
F.3d at 810.
  The first sentence in Grottanelli strongly suggests that
the issue in that case was different than the one here. The
court said, “This appeal primarily involves trademark
issues as to whether the mark ‘HOG’ as applied to large
motorcycles is generic . . . .” Id. at 808 (emphasis added).
The court then summarized its holding by stating, “[W]e
conclude that the word ‘hog’ had become generic as ap-
plied to large motorcycles before Harley-Davidson began
to make trademark use of ‘HOG.’ ” Id. (emphasis added).
A few paragraphs later, the court discussed the history
of “The Word ‘Hog’ Applied to Motorcycles” and, in the
remainder of the opinion, referred to the generic nature
No. 06-3618                                               9

of the word ‘hog’ “as applied to motorcycles” or “as applied
to large motorcycles” at least ten different times. The
court never stated that “hog” was generic as applied to a
motorcyclist club or to motorcycle products or services.
  The Second Circuit also noted that Harley conceded that
its claim failed if the word “hog” was generic as applied to
large motorcycles, further suggesting that the court had
no occasion to decide the issue in this case. Id. at 810.
Finally, the parties’ Second Circuit briefs did not discuss
whether “hog” was generic as applied to a motorcyclist
club, focusing instead on whether “hog” means large
motorcycle. See Wozniak v. County of DuPage, 845 F.2d
677, 683 (7th Cir. 1988) (examining the pleadings from
the prior suit to determine what issues were litigated).
  Grottanelli did mention that the “HOG” trademark was
used to refer to Harley’s motorcyclist club, but the court
did not state, or even suggest, that Harley’s use of the
word “hog” was generic as applied to the Harley Owners
Group. In short, the Grottanelli opinion and the parties’
briefs convince us that the Second Circuit did not resolve
the issue here: whether “hog” is a generic word for a
motorcyclist club. Accordingly, Harley is not collaterally
estopped from bringing the claims in this case.
  Top Quality argues that Grottanelli must have held that
“hog” was generic for all motorcycle products and services
because it allowed Grottanelli to continue using the
word “hog” when promoting his “Hog Holiday” motorcycle
rally, “Hog Wash” engine degreaser, and “Hog Trivia”
board game. Top Quality seems to suggest that by allow-
ing Grottanelli’s continued use of his trade names, the
Second Circuit found that both Harley’s and Grottanelli’s
use of the word “hog” was generic. However, that is
simply not the case. The Second Circuit had no occasion to
decide whether Grottanelli’s use of the word “hog” was
generic, because it already had held that Harley’s mark as
10                                                No. 06-3618

applied to large motorcycles was not protectable, and
Harley conceded that this doomed its claim. A plaintiff ’s
generic use of a word has no bearing on whether the
defendant’s use of the word is also generic.

     B. Protectability
  Having resolved that collateral estoppel does not pre-
clude Harley’s suit, we must address the merits. From our
previous discussion, it should be evident that Harley’s use
of the word “hog” is not generic as applied to its motorcy-
clist club. As noted above, a generic term is commonly used
as a name for the seller’s goods, see Liquid Controls
Corp., 802 F.2d at 936, while a descriptive term names a
characteristic of a particular product or service. See
McCarthy, supra at § 11:16. The word “hog” is not com-
monly used as a name for a motorcyclist club. It is a
name for a motorcycle. As such, Harley’s use of the
word “hog” to refer to the Harley Owners Group is not
generic; rather, it is descriptive because it describes the
club’s members: people who enjoy motorcycles. See Mc-
Carthy, supra at § 11:16 (stating that marks are descrip-
tive if they describe the class of users of the goods or
services) (citing cases); see also Shaw-Barton, Inc. v. John
Baumgarth Co., 313 F.2d 167, 168 (7th Cir. 1963) (holding
that “Homemaker” calendars are descriptive of the class
of users).3

3
  Top Quality does not argue that Harley’s mark lacks secondary
meaning, and neither party discusses whether Harley is re-
quired to offer evidence of secondary meaning. See Park ‘N Fly,
Inc. v. Dollar Park and Fly, Inc., 469 U.S. 189, 194-197 (1985)
(holding that once a descriptive mark becomes incontestable, it
cannot be challenged as lacking secondary meaning). We take
                                                  (continued...)
No. 06-3618                                               11

  Top Quality argues that it uses the word ‘hogs’ generi-
cally, and thus cannot be infringing on Harley’s mark. See
McCarthy, supra at § 12:3 (stating that a plaintiff ’s
trademark suit can be dismissed if the defendant’s use of
a word is generic). However, this argument lacks merit as
well. Though a consumer might conclude that Top Qual-
ity’s trade name means “Motorcycles on the High Seas,”
that is not what Top Quality is selling. See McCarthy,
supra at 12:1 (stating that when a name is generic,
“the name of the product answers the question ‘What are
you?’ ”). Top Quality’s service does not invite motorcycles
to travel on the ocean; it invites motorcyclists to travel on
the ocean. As a result, its mark is not generic.

    C. Likelihood of Confusion
  Having determined that Harley’s “HOG” and “H.O.G.”
marks are protectable, we need not discuss at length the
issue of likelihood of confusion, for Harley has offered
evidence of actual confusion in the form of a survey and
questions asked by Top Quality’s customers. AHP Subsid-
iary Holding Co. v. Stuart Hale Co., 1 F.3d 611, 618 (7th
Cir. 1993) (holding that a plaintiff ’s consumer survey can
be evidence of actual confusion). And evidence of actual
confusion (so long as it is not de minimis) ordinarily is
sufficient to create a genuine issue of material fact on the
issue of likelihood of confusion. See Thane Intern., Inc. v.
Trek Bicycle Corp., 305 F.3d 894, 902 (9th Cir. 2002) (“[I]f
a party produces evidence from which a reasonable
jury could surmise that an appreciable number of people
are confused about the source of the product, then it is
entitled to a trial on the likelihood of confusion.”) (empha-

3
  (...continued)
no position on the issue.
12                                                  No. 06-3618

sis in original and internal quotation omitted); Thomas &
Betts Corp. v. Panduit Corp., 138 F.3d 277, 297 (7th Cir.
1998) (“[E]vidence of actual confusion, where it exists, is
entitled to substantial weight.”). The fact that some of
Top Quality’s promotional materials disclaimed associa-
tion with Harley merely underscores the need for a jury
to resolve the conflicting evidence relating to this issue.4

     D. Unfair Competition
  The district court’s ruling on Harley’s unfair competition
claim was premised on its mistaken belief that Harley’s
“HOG” mark is generic. Because we conclude that the
“HOG” mark is not generic, we reverse the district court’s
ruling on this claim as well.

                      III. Conclusion
  For the foregoing reasons, we REVERSE the district
court’s ruling granting summary judgment in Top Quality’s
favor and REMAND the case for further proceedings con-
sistent with this opinion.

4
   Consumers may be confused notwithstanding the fact that
Harley often uses the word ‘hog’ in the singular form and with
periods, while Top Quality uses the word in the plural form
without periods. See Pastificio Spiga Societa Per Azioni v. De
Martini Macaroni, Co., 200 F.2d 325, 326 (2d Cir. 1952) (“The
attempt of the defendant to distinguish between the five letters
‘S.P.I.G.A.’ and the word ‘Spiga’ where the letters were not
separated seems to be essentially a distinction without a dif-
ference.”); McCarthy, supra at § 23:52 (“Merely because a
defendant uses a mark similar to a registered mark, but in a
form or script different from that shown in the registration, does
not preclude a finding of infringement of the registered mark.”)
No. 06-3618                                                13

  EVANS, Circuit Judge, dissenting. Because I believe
Harley-Davidson v. Grottanelli, 164 F.3d 806 (2d Cir.
1999), cannot be credibly distinguished from this case,
I respectfully dissent.
  Specifically, I disagree in part with the majority’s
statement that the Second Circuit “never stated that ‘hog’
was generic as applied to a motorcyclist club or to motor-
cycle products or services.” It is true that the court did
not discuss motorcycle clubs, but, as to the other half of
that statement, it is clear that the entire Grottanelli
opinion is about motorcycle products and services.
Grottanelli was not manufacturing motorcycles he called
“Hogs.” He was using “hog” to name his products and
services: Hog Farm, Hog Farm Holidays, Hog Holidays,
Hog Wash engine degreaser, and a Hog Trivia board game.
And the court specifically concluded:
    For all of these reasons, Harley-Davidson may not
    prohibit Grottanelli from using “hog” to identify his
    motorcycle products and services. [Emphasis added.]
At 812. It is, I think, disingenuous to attempt to distin-
guish something like “Hog Holidays” from cruises called
“HOGS ON THE HIGH SEAS.”
   Even Harley recognizes the difficulty in making that
distinction, a difficulty it tries to overcome by inviting us
to leap to the conclusion that Top Quality is using HOGS
to refer to a club for motorcyclists, thus taking it out of the
reach of Grottanelli. The majority, regrettably, accepts
Harley’s invitations. With all due respect, I cannot see
that conclusion as anything but strained. I see nothing in
Top Quality’s logo, or in the way it uses the word “hogs,”
which indicates that it is referring to a motorcycle club.
It’s referring to motorcycles, plain and simple.
 Because Top Quality’s use of the word does not refer to
motorcycle clubs, we should afford preclusive effect to
Grottanelli, a decision which provides considerable sup-
14                                              No. 06-3618

port for its conclusion that “hog” as applied to motor-
cycles is generic. The Second Circuit’s careful analysis
traces the history of the word as applied to motorcycles
to the 1960s and 1970s. The court points out that in 1965,
Newsweek and the Saturday Evening Post referred to “hog”
as a “big motorcycle” and a “lean, dangerous beast.” In
1967, Hunter S. Thompson quoted the Los Angeles Times,
saying a hog was “the kind of cycle the German couriers
used to run down dogs and chickens—and people—in
World War II: low brutish machines, with drivers to
match.” Grottanelli, at 808 n.2. The court also cited
dictionaries noting that a hog was a motorcycle, especially
a large one, and a 1975 article in Street Chopper was
entitled “Honda Hog.” The metaphoric use of the word
increased during the 1970s and 1980s, and it was often, no
doubt, applied to Harley-Davidson motorcycles. But for
several years Harley, Grottanelli tells us, tried to dissoci-
ate itself from the word “hog.” Then in the 1980s, the
company, apparently thinking that if you can’t beat ’em,
join ’em, changed course and started using the word. It
also formed its club—H.O.G.—shorthand for the Harley
Owners Group. Which is all fine and good. But, as
Grottanelli holds, Harley can’t commandeer and claim as
its own the generic slang term “hog.” We should brand
that attempt as hogwash and affirm the grant of sum-
mary judgment for Top Quality that was entered by
Judge Clevert in the district court.

A true Copy:
      Teste:

                        ________________________________
                        Clerk of the United States Court of
                          Appeals for the Seventh Circuit

                   USCA-02-C-0072—8-2-07