Thursday, April 11, 2019

Different meaning of Fizzkids and Wizkids defeats infringement claim even for similar products

Wizkids/NECA, LLC v. TIII Ventures, LLC, No. 17-CV-2400 (RA), 2019 WL 1454666 (S.D.N.Y. Mar. 31, 2019)

TIII sells “soda-can-themed toys, specifically, vinyl characters that are sold in packaging resembling a soda can.” The “Fizzkids” are called “Cranked Cola,” “Bone Crusher Root Beer,” “Vicious Dog Sparkling Water,” “Rummy Cola,” “Zombie Juice,” and “Alien Limeade.” NECA “is a leading provider of collectible figures, games and game equipment in the United States and abroad.” It has registered “WIZKIDS” for “game equipment, namely, miniature toy figurines and role playing equipment in the nature of game book manuals; collectible toy figurines for role playing games; and role playing games and game pieces and accessories therefore.” Some NECA figurines are licensed characters from well-known brands of comic books, television shows, movies, and video games, such as THE SIMPSONS, STARK TREK, MARVEL, DC COMICS, DUNGEONS & DRAGONS, PATHFINDER, and PORTAL.  NECA sued TIII, staying its opposition to TIII’s pending application to register its mark.

TIII’s survey showed consumers who’d bought a “collectible toy figurine” costing more than $10 in the past six months, or expecting to purchase one in the next six months, an image of the Rummy Cola figure and can and asked: “What company makes or puts out this collectible toy figurine that you just saw?” Those that named a company were then asked: “Why do you say that?”  Then: “do you believe the company that makes or puts out this product ... IS sponsored or approved by another company, IS NOT sponsored or approved by another company, or you don’t know or have no opinion.” The “is sponsored” respondents got a follow-up.  One of 617 respondents identified WIZKIDS as sponsoring or approving the FIZZKIDS product. NECA’s expert criticized the survey, mainly for not being able to detect confusion given that Wizkids isn’t a “top of mind” trademark.
Wizkids package with Guardians of the Galaxy
The court found that Wizkids was, at most, moderately strong: it was suggestive (not arbitrary or fanciful) and it had some marketplace success, but no direct evidence of secondary meaning.

Similarity was the real hurdle.  The marks sounded similar, but gave “notably different commercial impressions.”  Visually, they weren’t similar, with “distinctly different fonts and color combinations.” They were in different places on the packaging, “undercut[ting] the similarity of the sound of the marks.”

But the real killer was the meaning/context differences.  “Fizz” evoked a beverage, and obviously connected to the soda can theme.  “Wiz” is short for “wizard,” and has no soda theme. Further, Wizkids had a reverse house mark problem: that mark was “used primarily with products that bear more famous licensed brands.” The “Second Circuit has repeatedly found ... the presence of a distinct brand name ... weigh[s] against a finding of confusing similarity.” Even if some Wizkids products are sold in cylindrical packages, that didn’t make them soda-themed.  And even if Wizkids has just launched two product lines without licensed characters, there was no evidence that “products bearing only the WIZKIDS mark present a similar commercial impression to the soda-themed products bearing the FIZZKIDS mark.”  Sound similarity was “eclipsed by the differences in their meaning, modes of presentation, and the overall impression they convey.” Strongly favored TIII.

There was a factual issue on product relatedness/bridging the gap, so that factor could favor NECA.

Where a defendant submits survey evidence “tending to rebut charges of actual consumer confusion,” plaintiff’s “failure to present its own consumer survey weighs against a finding of consumer confusion.” NECA argued that actual confusion evidence was understandably lacking because only a few hundred of FIZZKIDS’ products have been sold. Moreover, the court gave the survey little weight (though didn’t deem it inadmissible, even though it lacked a control and didn’t leave the image in front of the consumer when asking questions, as would have been more accurate to replicate market conditions). But even without the survey, lack of evidence of actual confusion weighed in TIII’s favor.

There was no evidence of bad faith. Choosing a mark because it “reflects the product’s characteristics,” as TIII did, supported a finding of good faith, as did the evidence that TIII chose the FIZZKIDS mark before it was aware of the WIZKIDS mark, and that TIII previously engaged in trademark searches and sought the advice of counsel.

Quality, that Second Circuit makeweight, managed to favor TIII as well (though deserved little weight) because the quality differences between the parties’ products made confusion less likely.

Consumer sophistication: NECA’s predecessor-in-interest, responding to the PTO’s initial rejection of its application to register the WIZKIDS mark based on the registered third-party mark “WIX-KIDS” for toy vehicles, argued that the “consumers of the goods offered under the [WIZKIDS] mark populate a community of gaming enthusiasts ... that are thus likely to be knowledgeable about the goods they have chosen.” But that was sixteen years ago, and NECA argued that it had expanded the product line greatly since then. This was enough to create a factual issue, since there’s no trademark file wrapper estoppel.

On balance, the dissimilarity of the parties’ marks and the lack of evidence of bad faith weighed strongly in TIII’s favor. The strength of the mark weighed moderately in NECA’s favor, but even assuming the factors that were factually disputed were resolved on NECA’s side, no reasonable jury could find likely confusion. “[T]he maximum weight that can reasonably be assigned to these factors cannot overcome the finding that ‘looking at the products in their totality,’ consumers are not likely to be confused.”  Summary judgment for TIII.

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