Opinion
02 Civ. 4239 (HB)
December 31, 2003
OPINION ORDER
Star Industries, Inc. ("Star") brought suit against defendants Bacardi Company Ltd. Corp. and Bacardi U.S.A., Inc. (collectively "Bacardi") and Anheuser-Busch, Inc. ("Anheuser"). Star claims that defendants, in bad faith, employ an "O" design on their respective vodka and malt beverage products, which is confusingly similar to the "O" design on its "Georgi O" orange-flavored vodka. Star asserts claims for (1) unfair competition under § 43(a) of the Lanham Act and New York common law, (2) trademark dilution under N.Y. General Business Law § 360-1, and (3) deceptive acts and practices under N.Y. General Business Law § 349. Star seeks a permanent injunction and recovery of lost profits. A bench trial was held on July 25 and July 28-31, 2003, and the parties post-trial memoranda of law were filed on August 12, 2003. The lawsuit was sub judice after summation on August 14, 2003. For the following reasons, Star's request for injunctive relief, to prohibit the sale of certain Bacardi and Anheuser products in locations where Georgi O is distributed, is denied, and consequently, its request for lost profits is also denied. Since there is neither actual confusion nor the likelihood of confusion, the state claims are dismissed as a matter of law.
I. FINDINGS OF FACT
The asserted mark was first used on or about June 1996 by Star on its orange flavored Georgi O vodka, which was introduced as an extension of its extant Georgi brand vodka line. (Pl. Post-Trial Mem. at 1; Joint Pretrial Order ("JPTO") at 3). Each Georgi O bottle is labeled with the "Georgi" word mark, which is located above a large crest. Below the crest, the label depicts an orange slice and the phrase "Orange Flavored Vodka." (Pl. Ex. 11). The phrase and crest are encircled by the Georgi "O," which appears as an orange-colored oval trimmed in gold. Star applied to register "Georgi O" as a word mark with the United States Patent and Trademark Office ("PTO") in September 1996. (Pl. Ex. 4). In April 1997, the trademark examiner rejected Star's application on the basis that consumers would not recognize the oval that encircles the crest as the letter "O" in the "Georgi O" word mark, but rather a design element that simply surrounds the Georgi crest. Id. The examiner concluded that consumers would read the word mark only as "Georgi" not "Georgi O". Id.
Since 1980, Star has utilized the services of Heim Advertising, Inc. ("Heim"), an independent advertising agency. To date. Star has spent a total of $472,000 on advertising and promotions to promote Georgi O and its other lines of flavored vodkas, including store displays, promotional T-shirt and hat giveaways and some print, radio and trade advertisements. (Pl. Exs. 28-32, 213). Some of the merchandise bears the "O" design alone (Pl. Exs. 28-29), while other items display both the "O" and the "Georgi" name. (Pl. Exs. 30-32). In addition, Star promoted its Georgi vodka products through trade shows and publications, and advertised Georgi O on the side of delivery trucks of its New York distributor. Premier. (Valenti St. ¶¶ 15-I7). Beginning in 2002, plaintiff also ran bus advertisements and purchased billboards to promote all of the Georgi flavored vodka brands through featuring the Georgi O vodka bottle. The only promotional items that specifically promoted the "O" design alone were hats and T-shirts.
Approximately 12,500 cases of Georgi O vodka have been sold in the state of New York to date, with small numbers of cases having been sold in New Jersey, Georgia and Missouri. (Pl. Exs. 24, 26-39, 53, 55, 57, 62-62a, 76, 200); Valenti St. ¶ 8; Def's Tr. Ex. IW ¶¶ 2-6. Georgi O represents less than one percent of all vodka sales in the United States, with a total of 14,000 cases sold during the last eight years. (Tr. 88: 12-20; Pl. Ex. 76). Star projects that its total sales of Georgi O from 1996 to 2003 is just under $600,000 (Valenti Decl. ¶ 8).
Georgi O sales, as of March 2003, totaled 750 cases in New Jersey, 20 cases in Georgia, and 8 cases in Missouri.
On March 30, 2000, Bacardi conducted a trademark search to discover other similar marks that used the letter "O" in preparation for the release of their new orange-flavored rum, Bacardi O ("Bacardi O"). The search did not reveal any similar mark. On or about August 2001, Bacardi introduced Bacardi O to the market. The label of each bottle of Bacardi O rum has the "Bacardi" name toward the top of the label and an orange, gold-trimmed oval below the name, to indicate that the product is orange flavored. (Romanach Dep. 39:3-6). On or about March 2003, pursuant to a license agreement with Bacardi, Anheuser introduced an orange flavored malt beverage called Bacardi Silver O3 ("Bacardi O3"); (JPTO at 4). The primary difference between the Bacardi "O" label on the rum bottle and the malt beverage bottle is that the latter product superscripts the number "3" after the "O."
On June 23, 2003, Star filed another application with the PTO to register its "O" design as a trademark. At the time of trial (with no more recent indications to the contrary), the PTO had yet to respond to Star's application. Accordingly, Star's "O" mark is presently unregistered.
Although Georgi O and Bacardi O are both sold in liquor stores. Georgi O is generally displayed with other vodka products, while Bacardi O is generally displayed with other rum products. Because New York State prohibits the sale of hard liquors and malt beverages in the same store, the Bacardi O3 rum product is primarily sold in grocery stores in individual serving sizes and is not available on liquor store shelves. See N.Y. Alcoholic Beverage Control Law § 54 (Consol. 2003) (sale of off premise consumption of beer will be granted only to a grocery store and drug store): N.Y. Alcoholic Beverage Control Law § 63 (Consol. 2003) (sale of off premise consumption liquor precludes the sale of off premise consumption beer).
The Court focuses on the New York market because, as explained supra, New York is the only venue where Georgi O is sold in any substantial quantity.
II. CONCLUSIONS OF LAW
A. Separability of Star's "O" Mark From the Product Label
The "O" design contained on Star's Georgi O label encircles the Georgi crest, the words "Orange Flavored Vodka", and the drawing of an orange slice. (Pl. Ex. 11). Defendants contend that Star's "O" is intertwined with other graphic elements on the Georgi O product, and that its "O" must therefore be analyzed in view of the commercial impression created by the Georgi O label, as a whole. See Estate of P.D. Beckwith, Inc. v. Comm v. of Patents, 252 U.S. 538, 545-46 (1920); Cline v. 1-888-Plumhing Group. Inc., 146 F. Supp.2d 351, 362 (S.D.N.Y. 2001). Here, plaintiff seeks to isolate the "O" from the rest of the bottle label and assert its protectability as a separate and distinct element. 1 find little in the record, however, to support Star's claim that it has attempted to promote or emphasize the Star "O," as a distinct and separate element, apart from the remainder of the Georgi O label. Out of its over two hundred exhibits, only two (both hats) show the "O", without the Georgi name and crest (Pl. Exs. 28, 29). Although Star purchased 5,000 of these hats in 1997, it failed to provide any evidence that it distributed these hats at any promotional events. (Tr. 126: 6-8). Consequently, plaintiff offers little evidence to demonstrate that its "O" design would be recognized by ordinary consumers as a mark that is separate and distinct from the rest of the label. In view of the lack of evidence that Star has created a separate commercial impression in its "O" design, 1 agree with defendants that plaintiff has failed to prove that its "O" can alone function as a protectable mark. See American Can Co. v. Marcal Paper Mills, Inc., 152 U.S.P.Q. 772, 776(T.T.A.B. 1967); Marcalus Mfg. Co. v. Watson, 156 F. Supp. 161. 163-164 (D.D.C. 1957), aff'd 258 F.2d 151, 152(D.C. Cir. 1958) (holding that ovals presented to consumers along with the product's name were not protectable trademarks because the ovals shown independently could not establish the origin of the products; In re Hillench Bradsby Co., 204 F.2d 287, 290-291 (C.C.P.A. 1953) (holding that failure to prove that consumers associate the oval as a direct reference to the product precludes trademark protection). Rather, the Georgi word mark combined with the crest and the "O," together form a single unified design that must be analyzed in its entirety for infringement purposes.
B. Consumer Confusion Arising From Georgi "O" Label
If we apply the now famous seven-step analysis spelled out by Judge Friendly in Polaroid Corp. v. Polarad Elecs. Corp., 287 F.2d 492, 495 (2d Cir. 1961), the plaintiff fairs no better. Those factors are "(0 the strength of the claimant's mark; (ii) the degree of similarity between the claimant and defendant's marks; (iii) the proximity of the products; (iv) the likelihood that either party will `bridge the gap' and use the mark on products closer to the other's areas of commerce; (v) the sophistication of the buyers; (vi) the quality of the defendant's product; (vii) actual confusion; and (vii) the defendant's good or bad faith." See Scholastic, Inc. v. Stouffer, 221 F. Supp.2d 425, 434 (S.D.N.Y. 2002), paraphrasing Polaroid Corp., 287 F.2d at 495. While the "O" on plaintiff's and defendants' products are similar, which increases the likelihood of confusion, the other elements of the label, where the products are displayed, and the fact that one is rum an the other vodka, sufficiently distinguish the products to prevent consumer confusion.
In New York, where the vast majority of Georgi O is sold, New York state law prohibits the retail sale of malt beverages and liquor in the same store, which reduces the likelihood of confusion between Bacardi 03 and Georgi O Because Bacardi O rum and Georgi O vodka are the only two products that may be sold on the same premises, albeit with the plaintiff's product at half the price, (Bacardi Post Trial Mem. at 12). they present the sole possibility for the likelihood of confusion (Def. Exs. AF, CO, HS; Levanthal Dep. 25:14-25). While Georgi O vodka and Bacardi O rum and malt beverage may be in competitive proximity, the apparent presence of their names, printed on the front of the bottle in large and clear lettering, easily reduces any likelihood of confusion, particularly with plaintiff's conscious labeling of their product as "`orange-flavored vodka." Consumers are sophisticated enough to distinguish between vodka and rum. See, e.g. Buitoni Foods Corp. v. Gio. Buton C. S.p.A., 680 F.2d 290, 293 (2d Cir. 1982) ("we find no error in the court's finding that consumers of the Buton and Buitoni products at issue are sophisticated enough to distinguish table wine from aperitifs, brandies, and liqueurs."). It stretches credulity to believe that a sober consumer would go to a store, intending to purchase Georgi O vodka, and because of one graphic similarity on the label, purchase Bacardi's orange-flavored rum instead. While it is possible that Bacardi or Anheuser could attempt to create consumer confusion by using a mark on products that are close to plaintiff's area of commerce (sometimes known as "bridging the gap"), the existence of other brands of vodka that used an "O" to indicate orange-flavor prior to Georgi, (Tr.96: 12-15, 97: 9-11) undercuts plaintiff's argument that defendants were seeking to bridge the gap between their accused products and Georgi's. See, e.g. We Media Inc. v. Gen. Elec. Co., 218 F. Supp.2d 463, 475 (S.D.N.Y. 2002) (denying Lanham Act claim partly because "[p]rior to defendants' selection of the name `WE: Women's Entertainment', and within WEM's established market of print communications, a number of other magazines used the pronoun (or phonetic sound) `we' in their names.").
I fail to find compelling evidence of actual confusion, in the form of studies or surveys. Most notably, plaintiff failed to present any study on actual confusion. While defendants produced two surveys to demonstrate that there is no actual confusion between their respective products and Georgi O, both surveys are partially or wholly procedurally flawed. The Anheuser-Busch survey fails to present both Bacardi O and Georgi O to survey participants, but rather presents only Bacardi O3. See Simon Schuster, Inc. v. Dove Audio. Inc., 970 F. Supp. 279. 291 (S.D.N.Y. 1997) (held level of confusion, whether products emanated from a common source and likelihood of confusion were not demonstrated when only one party's products was shown in a consumer study.); Defs. Ex. HN. Further, both the Bacardi and the Anheuser-Busch surveys are of less import as they were each conducted in some markets where the Georgi O product is not even sold. See Hutchinson v. Essence Communications, Inc., 769 F. Supp. 541, 560 (S.D.N.Y. 1991) (when products are of the same type, the relevant market is one where both products are available); Defs. Exs. BH. HN. Notwithstanding the inherent flaws in Anheuser's survey, the fact that New York law, as stated supra, prohibits the sale of malt beverages and liquors on the same premise for off-premise consumption provides independent evidence that actual confusion is highly unlikely Defendants' confusion surveys in areas where Georgi O is sold shows that actual confusion between Georgi O vodka and Bacardi O rum is, at best, minimal, and indeed, is not any more likely than confusion with any other liquor product. Def. Ex. BH. The survey data presented by defendants, while not dispositive, adds weight to the evidence that actual confusion is absent.
Further, even plaintiff's anecdotal evidence of confusion was unsupported, i.e. plaintiff was unable to identify a single individual or produce a single witness to substantiate the testimony of third-party witnesses. Given the anonymity of these allegedly confused individuals, such evidence is of little probative value. Lastly, as to the bad faith branch of the Polaroid tree, plaintiff has failed to demonstrate that defendants adopted the mark in bad faith. See infra, p. 11. In summary, the totality of evidence in connection with each prong of the Polaroid test fails to support, by a preponderance, that consumers would confuse defendants' products with plaintiff's.
C. Protectability Of The Star "O" As A Separate Trademark?
1. Plaintiff's Burden
Assuming, arguendo, that Star's oval-shaped "O" mark could properly be severed from the rest of the design elements on the Georgi vodka label, I would still find for the defendants because plaintiff has not shown that its mark is a protectable trademark. To prevail on a claim under § 43(a) of the Lanham Act, the accuser must "demonstrate that it has a valid mark entitled to protection" and only after the accuser has met this initial burden may a court consider whether the accused's use of the mark is "likely to cause confusion." Gruner-Jahr USA Publishing, Div. of Gruner + Jahr Printing Publishing Co. v. Meredith Corp., 991 F.2d 1072, 1075 (2d Cir. 1993); see also EMI Catalogue Partnership v. Hill Holliday, Connors, Cosmopulos Inc., 228 F.3d 56, 62 (2d Cir. 2000) ("A plaintiff claiming unfair competition under § 43(a) must show that it owns a valid trademark eligible for protection"). "[W]here, as here, the mark is not registered . . . the burden is on plaintiff to prove that its mark is a valid trademark." Reese Publ'g Co. v. Hampton Int'l Communications, Inc., 620 F.2d 7, 11 (2d Cir. 1980). "An identifying mark is distinctive and capable of being protected if it either (1) is inherently distinctive or (2) has acquired distinctiveness through secondary meaning." Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 769 (1992).
Star's "O", although representative of the letter "O", is presumed to be seen simply as a geometric shape. The trademark examiner at the PTO rejected plaintiff's word mark application for "Georgi O" because the examiner determined that the "O" would not be distinguished by consumers as a letter. (Pl. Ex. 4). Star presents no evidence to rebut this presumption arising from the PTO's determination. Given the lack of evidence to show the PTO's determination was clearly erroneous, I will afford deference to the PTO's finding and analyze Star's mark under the standard applied to geometric shapes. Although the PTO is not necessarily the last word with respect to a mark and its protectability, where no evidence is introduced to the contrary, it is presumed to have acted properly. Thomas America Corp. v. Fitzgerald, 869 F. Supp. 221, 225 (S.D.N.Y. 1994) (holding that qualified government agency is presumed to have properly done its job unless evidence indicates otherwise); see In re Brana, 51 F.3d 1560, 1568 (Fed. Cir. 1995) (holding that PTO decisions based upon facts should be given deference by the court unless the decision is found to be clearly erroneous); Canady v. Erbe Elektromedizm GmbH, 271 F. Supp.2d 64, 79 (D.D.C. 2002) ("PTO is a technically specialized administrative agency . . . and the court will give deference to its decisions.").
Both case law and recognized treatises have spelled out the protectability of geometric shapes. "Most common geometric shapes are regarded as not being inherently distinctive, in view of the common use of such shapes in all areas of advertising." 1 McCARTHY ON TRADEMARKS § 7:29. "[B]asic [geometric] shapes such as circles, squares, ovals and rectangles, when used as vehicles for the display of a word mark, do not indicate the origin of the goods and hence cannot be appropriated exclusively, absent a showing of secondary meaning." Dow Corning Corp. v. Applied Power Indus., Inc., 322 F. Supp. 943, 945 (N.D. Ill. 1970) (emphasis added); see also Wiley v. American Greetings Corp., 762 F.2d 139, 142 (1st Cir. 1985); Blau Plumbing, Inc. v. S.O.S. Fix-It, Inc., 781 F.2d 604, 610 (7th Cir. 1982); Marcalus Mfg. v. Watson, 258 F.2d 151. 1 52 (D.C. Cir 1958); Seabrook Foods, Inc. v. Bar-Well Foods, Ltd 568 F.2d 1342, 1344-45 (C.C.P.A. 1977); Am. Can Co. v. Marcal Paper Mills. Inc., 152 U.S.P.Q. 772, 776 (T.T.A.B. 1967); In re Hillerich Bradsby Co., 204 F.2d 287, 289 (C.C.P.A. 1953); 1 McCARTHY ON TRADEMARKS § 7:29; 3 LOUIS ALTMAN, ED. CALLMANN ON UNFAIR COMPETITION, TRADEMARKS AND MONOPOLIES, § 18:25 (4th ed. 2003).
Even if I assume that consumers would recognize the "O" design in Star's mark to be a letter, Star does not deny that the "O" mark conveys to the consumer that the product is orange flavored. (Pl. Post-Trial Mem. at 2) ("Star's `0' design . . . secondarily conveys orange flavor."). The "O" mark describes a quality or characteristic of the goods, Abercrombie Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 11 (2d Cir. 1976), which ordinarily, as a descriptive mark, is not protectable unless it also has acquired secondary meaning. See, e.g., Nature's Bounty, Inc. v. Basic Organics, 432 F. Supp. 546, 552 (E.D.N.Y. 1977) (holding term "B-100" to be merely descriptive of vitamins and not subject to infringement without proof that secondary meaning has attached to the term); Bristol-Myers Squibb Co. v. McNeil-P.P.C, Inc., 786 F. Supp. 182, 193 (E.D.N.Y. 1992) (rejecting claim that letters are protectable without proof of secondary meaning). Plaintiff argues that § 1213.06 and § 1211.01(b)(ii) of the Trademark Manual of Examining Procedures ("TMEP") indicate that its "O" mark is protectable without a showing of secondary meaning. TMEP
§§ 1213.06. 1211.01(b)(ii) (3rd ed. 2003). Section 1213.06, titled "Entire Mark May Not Be Disclaimed," pertains to the protectability of a combination of elements in a mark, in which the generic elements of the mark, standing alone, would not be registrable. Plaintiff recites from § 1213.06 that "[e]xaminers must look for combination of elements in the mark, or something of sufficient substance or distinctiveness to make the composite registrable." TMEP § 1213.06. Section 1211.01(b)(ii), entitled "Stylization or Design Element." refers to the registration of a surname when it is combined with distinctive stylization or a design element. The TMEP states that a surname, which ordinarily is not registrable without proof of secondary meaning, may be protectable if dressed with stylized lettering that is distinctive enough to create a separate commercial impression. TMEP § 1211.01(b)(ii). Star submits nothing but its own conclusory statement to support its argument that the orange border and gold outer trim of its "O" make it so distinctive as to negate the primary impression on consumers that the "O" is simply a geometric shape (as determined by the PTO), that encircles other elements on the Georgi O label. I agree with defendants that Star cannot demonstrate that its mark is protectable without further evidence that secondary meaning has attached to the mark. Accordingly, Star bears the burden of proving by a preponderance of evidence that its "O" mark has become endowed with secondary meaning in the mind of the public by the time and at the place that Bacardi introduced its mark. See, e.g., Papercutter Inc. v. Fay's Drug Co., 900 F.2d 558, 564 (2d Cir. 1990) ("owner of a descriptive mark must demonstrate that the mark had acquired secondary meaning before its competitor commenced use of the mark")).
2. Secondary Meaning
The Second Circuit enumerated the following factors to establish whether secondary meaning has attached to a mark: (1) advertising; (2) consumer studies linking the mark to a source; (3) unsolicited media coverage of the product; (4) sales success; (5) attempts to plagiarize the mark; and (6) length of exclusivity of the mark's use. Centaur Communications v. A/S/M Communications, 830 F.2d 1217, 1222 (2d Cir. 1987). "In assessing the existence of secondary meaning, no single factor is determinative, and every element need not be proved." Thompson Medical Co., Inc. v. Pfizer Inc. 753 F.2d 208. 217 (2d Cir. 1985) (internal quotes and citations omitted). To establish that the disputed mark is protectable. Star would have had to produce strong evidence that consumers identify the asserted "O" mark with the source of the vodka when they see this design alone. In re Haggar Co., 217 U.S.P.Q. 81 (T.T.A.B. 1982). Analyzing the evidence collectively, I find that Star has failed to meet its burden.
Star's additional contention that their "O" is a background design does not change this evidentiary prerequisite.
No evidence was introduced to even suggest that the plaintiff's advertising created a separate commercial impression made by the disputed mark before the advent of Bacardi's orange-flavored rum. Indeed, Richard Heim, president of Star's advertising agency, testified that the first consumer advertising done to promote Georgi "O" vodka specifically, began in 2002, after Bacardi's release of its orange-flavored rum product in August 2001. (Tr. 320: 13-22). Since August 2001, Bacardi has spent $10 million to promote its accused product, easily dwarfing the amount spent by Star since 1996 for all of its flavored vodkas put together. The comparatively small advertising campaign initiated by Star after Bacardi's release of its product fails to demonstrate secondary meaning prior to the introduction of the Bacardi product.
Q. And it's also true, is it not, that in 1996 a decision was made not to spend any advertising money on [Georgi O vodka]?
A. That's correct.
Q. And it's also true, is it not, that in 1997 a decision was reached between you and Mr. Silver not to spend any advertising money [on Georgi O vodka]?
A. That's correct.
Q. And so the first advertising that was ever done for Georgi orange-flavored vodka was in calendar year 2002, that right?
A. Consumer Media Advertising.
Further, plaintiff conducted no consumer studies to demonstrate that consumers linked the "O" mark to Star or the Georgi brand name. While plaintiff successfully sold its product in a limited number of states, its overall sales volume relative to the sales volume achieved by each of the defendants, is hardly impressive. Star asserts that its Georgi "O" vodka sales have grown steadily since the introduction of the product line in June 1996, but total sales of Georgi vodka in any form whatsoever represent no more than one percent of annual vodka sales in the United States (Tr. 88: 12-20), with Georgi O as a small percentage of that one percent. Plaintiff's sales figures fail to support its claim that secondary meaning attached to its "O" mark before Bacardi O's 2001 release.
As for attempts to plagiarize a mark, the intent to copy a mark may be inferred from the defendant's prior knowledge of the plaintiff's mark along with the similarity between the parties' marks. 4 CALLMANN § 21:52 (4th ed. 2003); see Clinique Laboratories, Inc. v. Dep Corp., 945 F. Supp. 547, 555 (S.D.N.Y. 1996); Frehling Enterprises, Inc. v. International Select Group, Inc., 192 F.3d 1330, 1340 (11th Cir. 1999), cert. denied, 530 U.S. 1214 (2000). Plaintiff alleges that Tammy Dowling, a former sales and promotions manager for Premier, the plaintiff's distributor, and now a Bacardi employee, was aware of Star's "O" design and had contact with a Bacardi marketing executive before Bacardi released its accused product. However, Dowling testified that while she was aware of the Georgi O product when she learned of the Bacardi O launch, and was familiar with the Georgi O promotional hat when she first saw the Bacardi O promotional T-shirt, she did not inform the Bacardi marketing staff of the Georgi products because "it never occurred to [her] that one had anything to do with the other." (Tr. 126:9-133:1). When use of plaintiff's trademark has come to the attention of defendant's agents whose duties are of the type that would require sensitivity to plaintiff's marks in the marketplace, defendant may be charged with knowledge of the mark. 4 CALLMAN § 23:23 (4th ed. 2003). Despite Dowling's awareness of the Georgi O product, plaintiff's failure to prove that Dowling realized that there was a similarity between the Georgi and Bacardi products, and if so, that she had any duty to convey that information to anyone at Bacardi, precludes an inference of actual or constructive knowledge or an indication of bad faith. Id. Further, plaintiff has failed to demonstrate that the purpose of Dowling's contact with a marketing executive at Bacardi had anything to do with a scheme to copy plaintiff's mark. Although Bacardi's use of gold detailing in its "O" is on first blush suspicious, as it turns out, Bacardi had used similar detailing on its other flavored-vodkas, before the advent of the Georgi O product. (Def. Ex. HS). As for defendant Anheuser, plaintiff admits that it has no evidence that Anheuser ever attempted to plagiarize its "O" design to deceive consumers. (Tr. 95: 6-18).
Plaintiff argues that defendants' insufficient trademark search evidences their bad faith in adopting the mark. The initial trademark search conducted on behalf of Bacardi consisted of only 25 possible search strategies to find marks that contained the letter "O." (Defs. Ex. FA). A later search submitted by plaintiff containing 32 search strategies, which included a search for marks that consist of a word followed by the letter "O", uncovered the abandoned Georgi O vodka trademark application. (Pl. Ex. 154). Even when a mark is not registered and is descriptive, bad faith may be inferred if only a limited federal search is conducted and counsel's suggestion for an additional broader search is not heeded. See International Star Class Yacht Racing Ass'n v. Tommy Hilfiger, U.S.A., Inc., 80 F.3d 749, 753 (2d Cir. 1996). Here, defendant's original request for a "Bacardi O" search was not performed as instructed by Bacardi's in-house counsel, Linda D" Aquilar. Instead, the outside search firm performed a search for just the "O" mark, which revealed more than 3,000 results. The actual results of the search that were shown to the defendant were narrowed and some marks that contained a word followed by the letter "O" were excluded. (D'Aguilar Dep. 29:9-17; Defs. Ex. FA). The results of the search reported to Bacardi were specified and narrowed by the outside search company, and thus, the failure to uncover plaintiff's word mark application does not appear to arise from the defendant's bad faith effort to remain uninformed of the allegedly infringed mark. While Bacardi's 9-month delay between its initial search and its PTO application for a service mark registration, which incorporated the "O" at issue in this case, raises some concern, again, the delay, without more, is gossamer, and fails to demonstrate that the defendant acted in bad faith. (Defs. Ex. FA); (Pl. Ex. 151); (D'Aguilar Dep. 42: 17-24).
Finally, plaintiff has not exclusively used the "O" mark for any substantial length of time. Star used their particular "O" since June 1996, without any similarity in the alcoholic beverage industry, until the entrance of the Bacardi product in August 2001. Exclusive use is not proven, however, based solely upon the time of the initial use of the mark. See, e.g., Artcraft Novelties Corp. v. Baxter Lane Co., 685 F.2d 988, 990-91 (5th Cir. 1982) (even though plaintiff used trademark 20 years before defendant, court held that plaintiff's use was not exclusive because plaintiff's efforts did not result in the product's secondary meaning). And, during trial, defendants produced evidence of other orange flavored vodkas, like Stoli 0, that had been on the market before Georgi's and are identified with an 0. (Tr.96: 12-15, 97: 9-11). A third-party's extensive use of a mark lessens the possibility that a purchaser would be confused and believe the mark came from a particular single source. Gruner + Jahr, 991 F.2d 1078, citing Long v. Retirement Living Pub. Co., 949 F.2d 576, 581 (2d Cir. 1991).
The evidence offered by the plaintiff to support a finding of secondary meaning fails to demonstrate that the public identifies its "O" as indicative of the source. Without proof of secondary meaning, "there is no need for this Court to examine the second part of the test for trademark infringement the likelihood of confusion between the two marks." Ideal World Marketing, Inc. v. Duracell. Inc., 15 F. Supp.2d 239, 246 (S.D.N.Y. 1998), citing Thompson Med. Co., 753 F.2d 208, 217 (2d Cir. 1985). Since Star has failed to prove that its asserted mark is valid, and therefore, a protectable mark, its Lanham Act claim must fail.
D. Validity Of State Claims
To assert a claim under New York's common law trademark infringement or unfair competition statute, N.Y. General Business Law § 360-1, "the plaintiff must show either actual confusion in an action for damages or a likelihood of confusion for equitable relief". Malaco Leaf, AB v. Promotion in Motion Inc., 2003 U.S. Dist. LEXIS 17086, at *53; Jeffrey Milstein, Inc. v. Greger, Lawlor. Roth, Inc., 58 F.3d 27, 34 (2d Cir. 1995), 35 U.S.P.Q.2D (BNA) 1284, Kaufman Fisher Wish Co. v. F.A.O. Schwartz, 184 F. Supp.2d 311, 324 (S.D.N.Y. 2001), aff'd, 01-9370, 2002 WL 31520492 (2d Cir. Oct 31, 2002). If the plaintiff fails to show actual confusion or likelihood of confusion under the federal Lanham analysis, the state claims must also be dismissed as a matter of law. Id.: Scholastic, Inc. v. Stouffer, 221 F. Supp.2d 425, 433 (S.D.N.Y. 2002); Girl Scouts v. Bantam Doubleday Dell Publishing Group, Inc., 808 F. Supp. 1112, 1131 (S.D.N.Y. 1992), aff'd, 996 F.2d 1477 (2d Cir. 1993). Because plaintiff failed to demonstrate a substantial amount of actual confusion or likelihood of confusion, Star's N.Y. General Business Law § 360-1 claim is dismissed. See, e.g., Winner Int'l LLC v. Omori Enters., 60 F. Supp.2d 62, 73 (E.D.N.Y. 1999) ("Since the standards for unfair competition under New York law is essentially the same as that under § 43(a) of the Lanham Act, and the court will deny plaintiff's Lanham Act claims, a preliminary injunction based on state unfair competition law is unwarranted."), citing Safeway Stores. Inc v. Safeway Properties, Inc., 307 F.2d 495, 498 n. 1 (2d Cir. 1962); Tri-Star Pictures. Inc. v. Unger, 14 F. Supp.2d 339. 363 (S.D.N.Y. 1998).
Star's claim under New York's deceptive acts and practice law, N.Y. General Business Law § 349, must also fail upon similar grounds. Plaintiff could not demonstrate that Bacardi or Anheuser used a material deceptive act or practice directed to Star's consumers that caused actual harm ( i.e., where defendants' acts were likely to mislead a reasonable consumer.). Sec Boule v. Hutton, 328 F.3d 84, 93-94 (2d Cir. 2003); Maurizio v. Goldsmith, 230 F.3d 518. 521 (2d Cir. 2000); Marcus v. ATT Corp., 138 F.3d 46. 63 (2d Cir. 1998).
III. CONCLUSION
For the foregoing reasons, 1 find Star's "O" design is not a protectable mark and plaintiff's motion for injunctive relief and for lost profits are denied. The Clerk of the Court is directed to close all pending motions and remove this case from my docket.