Thursday, September 27, 2018

Blast from the past: nominative fair use avant la lettre

Polyglycoat Corp. v. Environmental Chemicals, Inc., 509 F.Supp. 36 (S.D.N.Y. 1980)

Found this in an unrelated search and it made me think about the utility (if any) of the nominative fair use category. Plaintiff sued defendant for advertising of defendant’s automotive silicone paint finish remover called POLYCRACKER. Plaintiff’s Polyglycoat, a protective paint finish sealant for automobiles, was heavily referenced on Polycracker’s label and its launch ad in Auto Body Repair News, a trade journal:

The words “Polyglycoat TM Remover” appear conspiciously on the POLYCRACKER label, one page of the ad consists solely of the bold-lettered statement “WIPE AWAY POLYGLYCOAT TM”, and the body of the ad contains such statements as “There’s nothing more troublesome for auto body shops than silicone finishes like Polyglycoat” and “Take off Polyglycoat with the wipe of a cloth.”

In terms of the Polaroid factors, the court found strong secondary meaning in the relevant market, the use of an identical mark, product relatedness sufficient to generate confusion, and an intent to “capitalize on the popularity of the POLYGLYCOAT mark and product in the field.” There was no evidence of actual confusion, but “a reasonable likelihood of confusion is inferred from defendant’s use of plaintiff’s exact trademark to promote its related product, the absence of a viable alternative explanation by defendant for its appropriation of the POLYGLYCOAT mark, and other circumstances of the relevant market.”

Thus, an injunction was warranted to keep Polyglycoat off the Polycracker label “either as it now appears, or any other way by which the mark is singled out as the generic, shorthand term standing for the species of paint finish sealants which POLYCRACKER is said to remove.” Defendant was also enjoined from singling out the mark in ads, e.g., “WIPE AWAY POLYGLYCOAT,” “Take off Polyglycoat,” “normal prep solvents ... do not remove polyglycoat,” “The Polyglycoat wipes off easily,” and “say good-bye to Polyglycoat problems.”

However, in the absence of falsity or misleadingness, defendant couldn’t be prevented from advertising that its product could remove automotive silicone finishes including POLYGLYCOAT, “the most popular and perhaps the most durable brand.” Thus, it could continue using the name “in such conjunctive phrases as ‘silicone finishes like Polyglycoat R.’” In any such use, the mark couldn’t appear in letters which distinguish it from the other words in the conjunctive phrase by size, color, typeface or any other characteristic. And a long disclaimer was required:
POLYGLYCOAT R is a registered trademark of the Polyglycoat Corporation, Scarsdale, New York, for its protective coating and sealant for automotive finishes. The term Polyglycoat as used herein means the product manufactured and sold by that company, and is used without the permission of Polyglycoat Corporation. POLYCRACKER is neither manufactured nor in any way sponsored or authorized by Polyglycoat Corporation.

This disclaimer probably did nothing but increase defendant’s advertising costs, since consumers weren’t particularly likely to read it.  And aside from the required disclaimer, this seems like pretty much the result you’d get from nominative fair use today (since courts would probably interpret the initial ad, at least, as using “too much” of the mark, as in the Playboy v. Welles case). 

What, if anything, does having nominative fair use as a defined concept add?  The current Second Circuit treatment is worse than nothing, since the NFU factors actually negate the significance of the other key Polaroid factors, like strength and identity of the marks, and can’t be weighed against them in an understandable way.  “Weighing” implies that enough strength and similarity (always present in a NFU situation) ought to be able to overwhelm the NFU factors, but they really don’t. The original concept from the Ninth Circuit was a way to formalize the obvious fact that there are some cases in which the multifactor test factors (particularly strength, similarity, and relatedness of goods) don’t point to the correct result.  In particular, the multifactor test doesn’t match our understanding of cases in which the trademark is clearly being used as a comparator or subject of discussion. I haven’t fully figured out my take on this, but I do think we need some doctrinal indicator to judges that there are times when the multifactor test is a bad idea, so that we don’t have to rely on the variable common sense of individual judges and in particular district court judges’ understandable fear of getting reversed when courts of appeals say that you have to use the multifactor test no matter what (except with Rogers, in the Second Circuit).

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