Thursday, May 12, 2016

Double play: Tyson defeats TM and false advertising claims

Parks, LLC v. Tyson Foods, Inc., No. 15-cv-00946 (E.D. Pa. May 10, 2016)
This case involves a trademark and false advertising dispute. Previous ruling denying an injunction. Parks claimed to own “Parks” for sausages and other foods. Tyson owns the “Ball Park” trademark for hot dogs; it launched a new line of “super-premium” frankfurters under the name “Park’s Finest.” Here, the court grants summary judgment to Tyson and illustrates the caution that a (putative) trademark owner who sues puts its own rights at risk.
False advertising: the court reaffirmed its conclusion that Parks’s allegations didn’t relate to the “nature, characteristics, qualities, or geographic origin” of the Park’s Finest product, and thus couldn’t properly be brought under §43(a)(1)(B); §43(a)(1)(A) was the proper home of a false association claim, which is a trademark claim. “Parks is not contending that Defendants have misrepresented the nature, characteristics, or qualities of their new line of frankfurters; its claim is that the name ‘Park’s Finest’ is ‘likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, . . . association . . . [or] origin’ of the product.” A §43(a)(1)(B) claim has to misrepresent either geographic origin or the characteristics of the good itself, such as its properties or capabilities. Citations: Kehoe Component Sales Inc. v. Best Lighting Prods., Inc., 796 F.3d 576, 590 (6th Cir. 2015) (quoting Sybersound Records, Inc. v. UAV Corp., 517 F.3d 1137, 1144 (9th Cir. 2008)); see Forschner Grp., Inc. v. Arrow Trading Co. Inc., 30 F.3d 348, 357 (2d Cir. 1994) (rejecting a claim that use of the phrase “Swiss Army knife” to describe “an inexpensive and shoddy multifunction pocketknife manufactured in China” constituted false advertising because the representation did not relate to either the geographic origin or the quality of the product). Note the inconsistency with the Fourth Circuit’s recent Belmora holding.

Use of “Park’s Finest”
could deceive consumers only if it led them to believe that the product was associated with Parks. That could happen only if the word “Parks” “identif[ies] and distinguish[es]” Parks’s products “from those manufactured and sold by others”—in other words, only if the word “Parks” constitutes a protectable trademark. Because Parks’s claim rises or falls based on whether it is able to establish that “Parks” functions as a trademark in the minds of consumers, the proper analytical framework in which to assess this claim is the law of trademarks.
Even assuming that §43(a)(1)(B) applied, Parks would still lose. The statement “Park’s Finest” wasn’t literally false. At the very least, it could be a reference to the brand “Ball Park,” and was thus ambiguous. After all, “Ball Park” was superimposed on “Park’s Finest” on the packaging, and both phrases were used together in radio and TV ads: “Park’s Finest from Ball Park.” Thus, even a consumer who knew the Parks brand wouldn’t “inevitably” perceive a reference to Parks.
Tyson’s intent was irrelevant: what mattered was the message in its context. “‘A determination of literal falsity rests on an analysis of the message in context,’ not on the message the speaker intended to convey or on survey evidence of what consumers may believe the message to mean.” Common sense and linguistics were enough to establish that “Park’s Finest” could be understood as a reference to the Ball Park brand. Plus, there was in fact evidence that “Park’s Finest” was intended to interact with the meaning of Ball Park, from Tyson’s market research firm, which concluded that “[t]he word ‘Park’ evoked feelings of the baseball park experience that is strongly associated with hot dogs,” and the name “linked strongly to the Ball Park brand name.”
Nor was the term misleading. Tyson presented a survey showing that only one in 200 people mistakenly believed that Park’s Finest originated with Parks. Parks produced a survey designed to show false advertising and trademark infringement, but it didn’t follow the proper pattern for a false advertising survey. It first should have asked what messages the consumer got and then asked consumers who received a relevant message “comprehension” questions to figure out what they thought the message meant.
Parks’s survey showed each subject five product images, including (in the test group) pictures of a Parks breakfast sausage package, a Park’s Finest package, and three other unrelated sausage and hot dog products, before asking whether the participant believed that two or more of those products were “from the same company or are affiliated or connected,” with followups as necessary.  The respondents who perceived a connection between Parks and Park’s Finest essentially all thought it was because of name similarity, but this survey “sheds no light on what message a consumer receives when they encounter the Park’s Finest packaging or, more importantly, whether the consumer would receive the false message that the product originated with, or was affiliated with, Parks.”  A respondent who didn’t receive any message about origin from the Park’s Finest product standing alone could simply have noticed that the word “Park” appeared in both images.  Such respondents should have been filtered out for false advertising purposes.
Another flaw in the survey was that it assumed that “Parks” had secondary meaning among the consumers of Park’s Finest.  “A consumer who is not familiar with the “Parks” name could not be deceived by the ‘Park’s Finest’ name, even if that consumer failed to comprehend that the product is part of the Ball Park family.”  The survey method allowed respondents to identify a connection even if they’d never heard of Parks.  “Outside of the survey environment, there would be no risk that this person would receive a false message from the Park’s Finest packaging.”  The fact that this claim turned on secondary meaning further reinforced that what was at issue was a trademark claim, not a false advertising claim. 
Finally, the survey didn’t target the appropriate universe.  Participants had to live in one of approximately two hundred ZIP codes in the country that, according to Parks, correspond to the locations of stores that sell “Parks”-branded products.  This attempt to survey consumers of Parks’s products might not be representative of whether a substantial portion of the intended audience for Park’s Finest would be deceived.
The remaining evidence wasn’t enough to allow a reasonable factfinder to conclude that a substantial portion of the target audience would be likely to be deceived, even though Tyson’s survey wasn’t without flaws of its own.  Parks cited reports by a licensee, Dietz & Watson, that three consumers who contacted Dietz & Watson after the launch of Park’s Finest product appeared to be confused about the relationship of the Park’s Finest product to Dietz & Watson’s “Parks”-branded products. Three consumers’ reaction was insufficient to be extrapolated to likely confusion among a substantial number of consumers.  Nor was the testimony of one of Parks’s co-owners that he’d been personally approached by personal friends who mistakenly believed that Park’s Finest product came from Parks. These “anecdotal” instances of confusion were also insufficient, both because of their small number and because the friends of one of the owners weren’t likely to represent average consumers.
Tyson also won summary judgment on the trademark infringement claim because Parks couldn’t show secondary meaning in the Parks name.  Its former federal registrations expired between 2003 and 2011; Parks in context was clearly a surname, requiring a showing of secondary meaning for protection (even though in other context, like “Ball Park’s,” it wouldn’t be a surname). 
While the length of sales and exclusivity supported a finding of secondary meaning, Parks failed to quantify how well the name was known before its present owners purchased it out of bankruptcy.  The court pointed to minimal advertising—Parks didn’t sell products directly, but licensed its marks to two entities, one of which only used the marks in grocery store circulars and at six “food shows” per year and the other of which sold Parks-branded products predominantly to the US military.  Likewise, company size and sales numbers didn’t establish secondary meaning; Parks was “a very small company,” according to Dietz & Watson, with its sales of Parks products about $5.5 million per year from 2008 to 2013, with nearly all of those sales coming from the Eastern United States region where Parks claimed to have secondary meaning.  This was no more than 1.3% of the breakfast sausage market and less than 1% of the dinner sausage market in the Northeast.
No reasonable factfinder could conclude that Tyson copied the Parks name.  Though a trademark search revealed the expired registration, the search was itself evidence of independent creation, since it was commissioned once the name was on the table.  Nor was Parks’s survey probative of secondary meaning.  Whether a survey that shows likely confusion shows secondary meaning depends on survey format: if respondents identify the plaintiff after being presented with nothing more than the defendant’s accused product, that’s good evidence of secondary meaning, but Parks’s survey was quite different.  All that Parks had was the “handful” of alleged instances of confusion, and given that Tysons had sold “many millions of units” of their Park’s Finest product to “[m]illions of consumers,” “reports of only a few actual instances of confusion cast substantial doubt on Parks’s claim of secondary meaning.”

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