Sixth Circuit Plays Sour Note In Rock N’ Roll Case

Non-traditional trademark formats continue to be the hottest focus in trademark law. These cases also seem to produce very disparate results. Can a design of a building function as a trademark? If it can, when a third party puts a photo of that building on a poster, is it actionable?

These issues may appear frivolous, but the stakes are high. A one-percent change in market share in hotly contested markets can be worth millions of dollars. There is no bright line between hard competition and misappropriation. In 1998 trade dress remains the most highly litigated and contentious area of trademark law.

In 1937 the 6th U.S. Circuit Court of Appeals held in White Tower System, Inc. v. White Castle System of Eating Houses, Corporation  that the White Castle restaurant building style was protectable under general principles of unfair competition law. Sixty-one years later in a 2-1 decision the 6th Circuit has held in Rock and Roll Hall of Fame and Museum, Inc. v. Gentile Productions  that a unique building design does not function as a trademark. The recent majority opinion also suggests that use of plaintiff’s registered trademark and service mark, “Rock N’ Roll Hall of Fame”, on a poster of that building by defendant is fair use under the Lanham Act .

The trial court in this case relied upon White Castle and held that Pei’s uniquely designed building was protectable. The majority decision of the 6th Circuit panel did not even mention White Castle, much less attempt to distinguish the case. The majority decision in Rock and Roll Hall of Fame is off key.

The Hall Of Fame Case

I. M. Pei is a world famous architect. In 1991 he was commissioned to design the Rock N’ Roll Hall of Fame in Cleveland, Ohio. The Rock N’ Roll Hall of Fame opened in 1995 and has several trademark and service mark applications pending to register Pei’s design with the U.S. Patent & Trademark Office. The majority in Rock and Roll Hall of Fame v. Gentile concludes that the Pei –designed building is “unique and distinctive”. The words “Rock N’ Roll Hall of Fame” have also been federally registered.

The Rock N’ Roll Hall of Fame began a licensing program using various renditions of the building on posters, postcards, postcards and snowdomes. Defendant Gentile, a professional photographer, started selling competitive posters featuring a photo of the building with the words “Rock N’ Roll Hall of Fame” under the photograph. The Rock N’ Roll Hall of Fame filed suit alleging trademark infringement, unfair competition, dilution and state claims.

The trial court in this case held that the parties were competitors in the business of selling posters. The court applied the 6th Circuit test of Frisch’s Restaurants  for purposes of determining if a preliminary injunction should issue. The trial court found that the Rock N’ Roll Hall of Fame design was a “unique” and distinctive trademark. The court relied upon prior decisions holding that unique building designs can function as trademarks . It then found a likelihood that the Rock N’ Roll Hall of Fame would succeed on the merits and issued a preliminary injunction. Gentile appealed.

On January 20, 1998 the 6th Circuit reversed the trial court in a 2-1 decision, with a strong dissent by Chief Judge Martin. The majority first found no evidence in the record proving that the public recognized the design of the Rock N’ Roll Hall of Fame as a trademark. This finding should have ended the matter. Unfortunately, the majority continued its analysis, and in the process ignored 6th Circuit and Supreme Court precedent and the Federal Trademark Statute – the Lanham Act .

Misinterpreting McCarthy on Trademarks

The majority inauspiciously begins by misstating a quote from McCarthy on Trademarks and Unfair Competition, suggesting that not all inherently distinctive symbols or words on a product function as trademarks. Professor McCarthy’s quote is, “Not every single word, phrase, design or picture that appears on a label or in an advertisement qualifies as a protectable mark or trade dress.”  There is an obvious difference in the statements, since virtually all distinctive symbols are used as trademarks.

Many products use multiple trademarks, including house brands, company names, product lines, numerical designations and even color designations. The majority cites McCarthy and a decision where use of the words “Innocent Beige” on a Clairol brand hair-coloring product was held not to function as a trademark .  Some products have terms or designations on them that could function as trademarks but do not. They simply are not used in a way that indicates source.

A trademark is defined as "any word, name, symbol, or device or any combination thereof" used by any person  "to identify and distinguish his or her goods, including a unique product, from those manufactured or sold by others and to indicate the source of the goods, even if that source is unknown."  In order to be registered, a mark must be capable of distinguishing the applicant's goods from those of others.

Ignoring Ferrari

In 1991 the 6th Circuit held in Ferrari v. Roberts  that the exterior shape and appearance of a Ferrari automobile functioned as a trademark and was infringed by the defendant’s automobile.  In Ferrari the Court ruled that the overall trade dress of an article could be protected, including the image and overall appearance of a product. Citing the 5th U.S. Circuit Court of Appeals case of Allied Mktg. Group , the 6th Circuit stated that trade dress embodies the arrangement of identifying characteristics or decorations connected with a product, whether by packaging or otherwise, intended to make the source of the product distinguishable from another and to promote its sale.

The Ferrari decision explained the evolution of trademark law. (In a bizarre twist, the majority opinion was written by the same judge who wrote for the majority in Rock N’ Roll Hall of Fame.) The Lanham Act’s protection in 1946 was limited to the use of marks likely to cause confusion or mistake or to deceive purchasers as to the source of origin of such goods or services. However, in 1967, Congress deleted this language and broadened the Act's protection to include the use of marks “likely to cause confusion or mistake or to deceive”.  Thus, Congress sought to increase protection by making actionable the deceptive and misleading use of marks in commerce; as well as to protect persons against unfair competition.

Interestingly, the majority in Rock N’ Roll Hall of Fame makes no mention of Ferrari. The first question must be whether the exterior design of the Rock N’ Roll Hall of Fame can function as a trademark. The answer to that question is an unambiguous “yes”. Professor McCarthy states that, “The design or appearance of a building can be protected from confusingly similar usages under the category of either trademark, service mark or trade dress”  . The majority opinion acknowledges that, “no one could doubt that the Museum’s building design is fanciful” . McCarthy states that the use of a distinctive architectural feature or decoration can serve as an identifying feature of a business.

Overruling Two Pesos

The Supreme Court recognized that the trade dress of a building (Mexican restaurant) could be protected as a trademark in Two Pesos, Inc. v. Taco Cabana, Inc.  The issue in Two Pesos was whether the trade dress of a building may be protected without a showing of secondary meaning. The Court found that no basis in Section 43(a) of the Lanham Act for treating distinctive trade dress differently from distinctive verbal or symbolic trademarks, “..since such trade dress is capable of identifying products or services as coming from a specific source..” .

The Court rejected the 2nd Circuit requirement that even distinctive trade dress must have secondary meaning. The Court stated that adding a requirement of secondary meaning for inherently distinctive trade dress undermines the purposes of the Lanham Act. The Court specifically stated that the distinctiveness of trade dress must be evaluated in the same manner as word marks .

It is unfortunate that the 6th Circuit ignored the Supreme Court’s teachings in Two Pesos. That is, if the Rock N’ Roll Hall of Fame’s building design is distinctive, it is protectable as a service mark. The 6th Circuit recognizes that use of a mark on “collateral items” such as T-shirts is trademark use that can be protected . However, the majority of the Rock N’ Roll Hall of Fame panel concluded that neither the Rock N’ Roll Hall of Fame’s nor Gentile’s use of a photo of the Rock N’ Roll Hall of Fame on a poster was trademark use. Since the Rock N’ Roll Hall of Fame and defendant sell such posters, the only issue is whether the public believes that the mark’s owner sponsored or otherwise approved of the use of the trademark. The 6th Circuit has phrased the question as not merely whether consumers are confused but whether they think there is some affiliation between the two products .

The majority continued by reasoning that the Rock N’ Roll Hall of Fame’s building design is fanciful, but not in a “trademark sense”. The majority proceeded to distinguish between fanciful words “…like Exxon…” and concluded that a photo of the Hall of Fame might be perceived as ornamentation rather than a source identifier. This distinction between treatment of trade dress and word marks is exactly what the Supreme Court held to be improper in Two Pesos . It is also contrary to 6th Circuit law that a trademark design can have an ornamental function along with a source identifying function .

This attempt at distinguishing between word trademarks and all other types is completely contrary to the Supreme Court’s holding in Qualitex Co., v. Jacobson Products Co., Inc.,   where a unanimous Court held that the color green on a dry cleaning pad can function as a trademark by identifying source. Justice Breyer stated that the Lanham Act defined the term trademark in the broadest of terms . He noted that almost anything capable of carrying a meaning can function as a trademark because the definition may not be read restrictively. Anything that is used as a trademark and indicates source is protectible as a trademark.

Regrettably, the majority decision in Rock N’ Roll Hall of Fame did not cite or attempt to distinguish Qualitex . Instead, they noted that the Rock N’ Roll Hall of Fame used different photos of the building on different merchandise. The majority analogized trademark rights in building designs to a series of cases involving the likenesses of long-deceased celebrities, like Elvis Presley and Babe Ruth.   This analogy is incorrect. This line of cases is restricted to deceased celebrities who did not promote their faces or images as trademarks during their lifetime. In these cases courts have required that the particular photo indicate source to provide protection. The challenged use must cause a likelihood of confusion, as to source, sponsorship, affiliation or connection with the person or their estate  in order to find infringement.

The 6th Circuit analogy fails when it is applied to live celebrities. Film star Woody Allen was successful in enjoining a clothing store from using a “look-alike” in their advertising under a false endorsement theory , while television game host Vanna White created a triable issue as to whether a robot in a blond wig advertising television sets violated her persona .
 

The 6th Circuit majority states that the Rock N’ Roll Hall of Fame uses slightly different photographs of the Museum on merchandise. The majority concludes from this that absent “consistent and repetitive use” of the same design it does not indicate source or function as a trademark. The majority provides no legal support for this proposition. Can anyone seriously doubt that basketball star Michael Jordan can enjoin the unauthorized sale of posters bearing any recognizable photo of him?

The Fair Use Argument

Finding that the Rock N’ Roll Hall of Fame has no trademark rights in its building design, the majority concluded that on the record the defendant may not be preliminarily enjoined from selling directly competitive posters depicting the Rock N’ Roll Hall of Fame Museum. The majority then turned to the issue of whether the defendant may use the federally registered service mark “Rock N’ Roll Hall Of Fame” on its poster . Incredibly, the majority suggests that the use of another’s federally registered trademark on competitive goods may very well constitute “fair use” under the Lanham Act .

The majority suggests that a defendant may use plaintiff’s registered trademark on a poster of plaintiff’s building design, and defend this on the grounds of “fair use” in describing the defendant’s goods. There is no relevant support for this proposition, although the majority opinion cites a 1st Circuit decision that permitted a rival television station to identify its broadcast of the Boston Marathon using that term.

“Fair use” is a defense that requires the defendant to prove all three of the following elements: 1) use of the term not as a trademark or service mark; 2) use of the term is “fairly and in good faith”; and 3) use of the term is only to describe the defendant’s own goods or services .

There is no recent 6th Circuit law on fair use. The 7th U.S. Circuit Court of Appeals has said that if the defendant’s use is exactly the same type of use that the plaintiff is trying to protect with its trademark, then it is a clear infringement . The 2nd U.S. Circuit Court of Appeals has said that it would be somewhat anomalous to permit the confusing use of another’s trademark as “fair use” .
Professor McCarthy concurs that “fair use” cannot co-exist with confusion . While Judge Kozinski has posited a three-prong test in 1991 that would permit a fair use defense where the defendant has used the plaintiff's mark to describe the defendant’s own product , this test has not been accepted. One court has specifically questioned this logic .

In analyzing fair use, courts focus on the manner in which the defendant uses the plaintiff’s trademark. If the mark is being used as “an attention getting symbol”, it is trademark use . The defendant in the Rock N’ Roll Hall of Fame case is clearly using the mark Rock N’ Roll Hall of Fame as an attention getting symbol on a competitive product. Thus, the fair use defense is inapplicable. Moreover, the defendant is using the term to describe a photo of plaintiff’s building design, not defendant’s building. Defendant Gentile’s use does not meet either the first or third prong of the “fair use” defense. It should have no application to this case.

However, the majority re-stated the issue of Gentile’s using the Rock N’ Roll Hall of Fame’s registered trademark in another way, whether consumers view the words “Rock N’ Roll Hall of Fame” as a “label” for the Gentile’s photograph or as an indicator that his photograph was sponsored by the Museum. This seems to be a variation of the 9th U.S. Circuit Court of Appeals’ infamous “purchaser motivation test” . That test held that a term was generic unless a majority of consumers were motivated to purchase the product because they knew its actual producer.

Professor McCarthy called the test a bizarre and aberrational view outside of the mainstream of trademark law . More importantly, this test was specifically overruled by an Act of Congress in 1984, the Trademark Clarification Act  which amended the Lanham Act. The motivation of the purchaser is irrelevant in determining if a mark has become generic. The only test is whether the public believes the term is a trademark. The Act also precludes finding that a term is generic solely because it identifies a “unique” product or service , like the Rock N’ Roll Hall of Fame.

How To Get the 6th Circuit Back In Tune

Chief Judge Martin wrote a simple and thorough dissent in Rock N’ Roll Hall of Fame. His view is that, under Qualitex, the Rock N’ Roll Hall of Fame building design is a trademark for its. A poster depicting that building design is also protectable as a trademark, just like any other trademark used on collateral items. The Hall of Fame’s posters and Gentile’s are almost identical and directly compete in the market. This creates a likelihood of confusion that should be enjoined.

Another circuit court has gone off-key on the protection afforded non-traditional trademarks. The Supreme Court decided that trademarks and trade dress should be treated the same in Two Pesos. The circuit courts are struggling over how to deal with all of the properties that may be protectable as trademarks.

Competitors have a legitimate right to lawfully compete in the market. The issue is how courts balance this against the rights of trademark owners to protect their trademark rights and investment.
Some courts are troubled with the idea that non-words are as fully protectable under trademark law to the same extent as coined words.

Such judicial reluctance overrules the clear message of several Supreme Court decisions over the past fifteen years expanding the protection afforded trademarks .  This type of analysis also reveals a failure to understand the Lanham Act’s primary goal of protecting the public from deception . Rather than improvise, the circuit courts should follow the Supreme Court in conducting the score composed by Congress of the Lanham Act.

© 1998 Joseph R. Dreitler
Joseph R. Dreitler is of counsel to the firm of Vorys, Sater, Seymour and Pease in Columbus, Ohio. He is chair of the International Trademark Association 1998 Annual Meeting in Boston and was chair of INTA’s Amicus Brief Committee for the filing of the brief in Qualitex.