UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
Nos.
01-16189 & 01-16647
D. C. Docket No.
01-00441 CV-4-SPM
CUMULUS MEDIA, INC.,
Plaintiff-Appellee,
versus
CLEAR CHANNEL COMMUNICATIONS, INC.,
Defendant-Appellant.
Appeals from the United States District Court
for the
Northen District of Florida
(September 6, 2002)
Before
BIRCH and
MARCUS, Circuit Judges, and
FULLAM *, District Judge.
MARCUS, Circuit Judge:
Clear Channel Communications, Inc. ("Clear Channel") appeals from the
district court's entry of a preliminary injunction in this trademark infringement
suit. At issue is whether Clear Channel has infringed the rights of Cumulus
Media, Inc. ("CMI") by identifying its Tallahassee, Florida radio station by the
name "The Breeze." While Clear Channel asserts that CMI has abandoned its
rights in the name, the district court found otherwise and preliminarily enjoined
Clear Channel from using "The Breeze" to identify its radio station. After
thorough review, we can find no error in the entry of the preliminary injunction
and accordingly affirm.
I.
The facts relevant to this appeal are straightforward. The parties own and
operate competing radio stations in the Tallahassee, Florida market: CMI operates
WBZE-FM at 98.9 on the FM dial and Clear Channel operates WTLY-FM at
107.1.
In January 1994, CMI began using the name "The Breeze," along with a
distinctive logo and trading style incorporating the name, to identify WBZE.
Between 1994 and September 2000, CMI used "The Breeze" in many forms of
advertising and promotion for WBZE radio broadcasts, including radio and
television advertising, outdoor signage, business cards, cups, mugs, license plates,
t-shirts, post-it notes, and stickers. From 1998 to 2000 alone, CMI spent more
than a million dollars in the advertising and promotion of "The Breeze."
In September 2000, CMI began identifying WBZE on the air as "Star 98"
instead of "The Breeze" and announced the change through on-air advertisements.
At the same time, CMI altered its music programming from "mainstream adult
contemporary," which targets listeners twenty-four to fifty-four years old, to "hot
contemporary," which targets a slightly younger demographic of eighteen to forty-nine year olds. Other aspects of WBZE's programming, such as its call-in shows,
remained unchanged.
After the change, "The Breeze" name continued to appear on some WBZE
materials, including, inter alia, a large outdoor sign at WBZE's headquarters,
where listeners come to collect promotional awards, business cards used by WBZE
management and sales representatives, and promotional materials such as cups and
license plate holders. Third parties also apparently maintained a continuing
association of "The Breeze" with WBZE. As recently as September 2001, a full
year after WBZE's name change and a mere month before this suit commenced,
the Arbitron rating agency, which measures radio audience market share,
continued to credit WBZE if a listener reported listening to "The Breeze" in
Tallahassee.
On October 8, 2001, approximately thirteen months after CMI's name
change, Clear Channel changed WTLY's on-air name from "The Mix" to "The
Breeze" and adopted a logo nearly identical to WBZE's "The Breeze" logo. Clear
Channel, which spent more than $25,000 to promote WTLY as "The Breeze,"
announced the name change with on-air advertisements making statements such as
"It's back Â… and it's now at 107.1 FM -- The Breeze" and "The Breeze has blown
up the dial." One advertisement announced that "WTLY has completed the most
comprehensive radio research study in the history of Tallahassee Â… and you told
us you want The Breeze back Â… so we did exactly what you wanted Â…. The
Breeze is back and on the air at 107.1 FM." WTLY uses a mainstream adult
contemporary format, apparently similar to the one used by WBZE before its
format change. The district court found that WTLY and WBZE appeal to
substantially the same listeners (even after WBZE's format change) and seek to
generate revenue from the same advertisers in the same geographic market.
CMI quickly learned of Clear Channel's use of "The Breeze." On October
12, four days after Clear Channel began identifying WTLY as "The Breeze," CMI
filed a complaint in the district court against Clear Channel for trademark
infringement and unfair competition in violation of § 43(a) of the Trademark Act
of 1946 (Lanham Act),
15 U.S.C. § 1125(a); the Florida Deceptive and Unfair
Trade Practices Act, Fla. Stat. § 501.204 ("FDUTPA"); and Florida common law.
On the same day, CMI forwarded a courtesy copy of the complaint to Clear
Channel along with a cease and desist demand.
Six days later, on October 18, CMI filed a motion for a preliminary
injunction. On October 24, the district court conducted a hearing on the motion,
during which it received evidence from both parties. CMI submitted evidence
aimed at showing its continuing use of "The Breeze." This evidence included
cups, license plates, bumper stickers and other advertising items featuring "The
Breeze" name; the business cards of WBZE managers showing "The Breeze" logo;
and pictures of the large billboard outside the WBZE office depicting "The
Breeze" logo. CMI also submitted an audio recording of an on-air conversation,
recorded October 22, 2001, between the WBZE operations manager and an
anonymous caller, who evinced confusion over WTLY's use of "The Breeze."
Clear Channel submitted evidence as well, largely in the form of affidavits from
its own employees stating their belief that CMI had changed WBZE's name from
"The Breeze" to "Star 98."
On November 1, the district court issued its order. It found that CMI had
made continuous, commercial use of "The Breeze" rather than abandoning it, and
thus had continuing rights in the name under both FDUTPA and the Lanham Act.
It also found that Clear Channel had changed WTLY's name to "The Breeze" to
divert audience market share from WBZE to WTLY and to trade off of preexisting
public awareness of "The Breeze." It thus found that Clear Channel's use of "The
Breeze" had been calculated to mislead substantial numbers of Tallahassee radio
listeners into believing that WTLY's "The Breeze" was a continuation of (or
somehow affiliated with) WBZE's "The Breeze." The district court further found
that Clear Channel's use of the name had in fact confused Tallahassee radio
listeners. Based on these findings, the district court concluded that CMI would
likely succeed on its infringement and unfair competition claims. After further
concluding that the balance of hardships and the public interest tipped in CMI's
favor, the district court entered a preliminary injunction restraining Clear Channel
from using "The Breeze" to identify WTLY or any WTLY broadcasts and from
using or displaying any imitation of the trading style of WBZE's "The Breeze."
Immediately after the district court issued its preliminary injunction order,
Clear Channel filed a notice of appeal, which is the basis of Appeal No. 01-16189,
and moved the district court for a stay pending appeal. On November 2, the
district court denied the stay motion.
On November 6, Clear Channel filed a motion for modification of the
injunction, arguing that it was overbroad because it prevented Clear Channel from
making any use of "The Breeze" name, even "curative uses" designed to dispel
confusion, such as identifying WTLY as "The Breeze 107.1" or "The New
Breeze." Clear Channel also moved for a second hearing to submit testimony and
other evidence, arguing that it had not been provided sufficient time to prepare for
the hearing held on October 24. On November 20, the district court denied these
motions and Clear Channel filed a second notice of appeal from these denials,
which is the basis of Appeal No. 01-16647. We have consolidated Clear
Channel's two appeals.
II.
A.
Clear Channel's sole argument in the district court was that CMI is not
entitled to a preliminary injunction because it has abandoned "The Breeze" as a
protectable trade name.
(1) The district court rejected Clear Channel's abandonment
argument, finding that CMI had continued to make "continuing commercial use"
of "The Breeze" even after the September 2000 name change. Clear Channel
contends on appeal that the district court erred as a matter of law because it
continued to impose upon Clear Channel a "strict burden of proof" after Clear
Channel established what it believes to be a prima facie case of abandonment.
Leaving this burden on its shoulders, Clear Channel contends, contravenes our
holding in E. Remy Martin & Co., S.A. v. Shaw-Ross Int'l Imports, Inc., 756 F.2d
1525 (11th Cir. 1985). After careful review, we find no legal error in the district
court's analysis.
We begin our review by noting how deferential it is. Preliminary
injunctions are, by their nature, products of an expedited process often based upon
an underdeveloped and incomplete evidentiary record. See Revette v. Int'l Ass'n
of Bridge, Structural & Ornamental Iron Workers,
740 F.2d 892, 893 (11th Cir.
1984) (per curiam) ("[T]he grant or denial of a preliminary injunction is almost
always based on an abbreviated set of facts . . . .") (quoting Gray Line Motor
Tours, Inc. v. City of New Orleans,
498 F.2d 293, 296 (5th Cir. 1974)). As is
usually the case, the trial court is in a far better position than this Court to evaluate
that evidence, and we will not disturb its factual findings unless they are clearly
erroneous. See CBS Broad., 265 F.3d at 1200; E. Remy Martin, 756 F.2d at 1529
("Factual findings . . . will be reversed only if clearly erroneous").
The expedited nature of preliminary injunction proceedings often creates
not only limits on the evidence available but also pressure to make difficult
judgments without the luxury of abundant time for reflection. Those judgments,
about the viability of a plaintiff's claims and the balancing of equities and the
public interest, are the district court's to make and we will not set them aside
unless the district court has abused its discretion in making them. See Ambrit, Inc.
v. Kraft, Inc.,
812 F.2d 1531, 1547 (11th Cir. 1987) ("We review the district
court's order only for an abuse of discretion; '[t]he trial judge's ability to
formulate a decree tailored to deal with the violations existent in each case is
normally superior to that of any reviewing court, due to his familiarity with [the]
testimony and exhibits.'") (alterations in original) (quoting United States v.
Loew's, Inc.,
371 U.S. 38, 52, 83 S. Ct. 97, 105-06, 9 L. Ed. 2d 11 (1962));
Revette, 740 F.2d at 893 ("The district court's decision will not be reversed unless
there is a clear abuse of discretion. This Court will not review the intrinsic merits
of the case.") (citations and quotations omitted); Gray Line, 498 F.2d at 296
(noting that whether to grant a preliminary injunction "requir[es] a delicate
balancing of the probabilities of ultimate success . . . with the consequences of
immediate irreparable injury . . . . Weighing these considerations is the
responsibility of the district judge . . . .").
Ordinarily, a district court's legal conclusions alone are subject to our de
novo review. See CBS Broad., 265 F.3d at 1200; E. Remy Martin, 756 F.2d at
1529 ("[I]f the trial court has misapplied the law, then this court must review and
correct the error without deference to that court's determination regarding the
legal issue."). Only if we find that the district court has erred in its apprehension
or application of the law will we subject the entirety of a preliminary injunction
order to plenary review. See E. Remy Martin, 756 F.2d at 1529 ("If the lower
court has misapplied the law, its conclusions are subject to our broad review.").
The district court found that CMI is likely to prevail on its claims because it
has protectable rights in the name "The Breeze" and Clear Channel has used the
name in a deceptive manner likely to mislead Tallahassee radio listeners.
(2)
We
agree. CMI has clearly made use of "The Breeze" in commerce,
(3)
the name itself is
at least suggestive (and perhaps arbitrary or fanciful) and thus protectable under §
43(a) without a showing of secondary meaning,
(4)
and we find no fault in the district
court's conclusion that Clear Channel's use of that name is likely to cause
confusion -- indeed, has already caused confusion -- among Tallahassee radio
listeners.
(5)
Clear Channel does not challenge these conclusions, but instead asserts the
affirmative defense of abandonment, by which a defendant may demonstrate that a
trademark plaintiff no longer holds the rights to a mark. Abandonment is
trademark law's way of recognizing that "[t]rademark rights flow from use."
Ambrit, 812 F.2d at 1550; see also Defiance Button Machine Co. v. C & C Metal
Prods. Corp.,
759 F.2d 1053, 1059 (2d Cir. 1985) ("A trademark or trade name . . .
represents the reputation developed by its owner for the nature and quality of
goods or services sold by him . . . .") (citing Prestonettes, Inc. v. Coty, 264 U.S.
359, 368, 44 S. Ct. 350, 351, 68 L. Ed. 731 (1924)) (other citations omitted).
If a mark holder stops using a mark with an intent not to resume its use, the
mark is deemed abandoned and "falls into the public domain and is free for all to
use. . . . Abandonment paves the way for future possession and property in any
other person." J. Thomas McCarthy, McCarthy on Trademarks and Unfair
Competition §17:1 (4th ed. 2001); see also Abdul-Jabbar v. Gen. Motors Corp., 85
F.3d 407, 411 (9th Cir. 1996) ("Rather than countenancing the 'removal' or
retirement of the abandoned mark from commercial speech, trademark law allows
it to be used by another."); Indianapolis Colts, Inc. v. Metro. Baltimore Football
Club Ltd. P'ship,
34 F.3d 410, 412 (7th Cir. 1994) ("When a mark is abandoned, it
returns to the public domain, and is appropriable anew . . . ."). Thus, a defendant
who successfully shows that a trademark plaintiff has abandoned a mark is free to
use the mark without liability to the plaintiff.
Under the Lanham Act, a protectable mark or name is considered abandoned
if "its use has been discontinued with intent not to resume such use." 15 U.S.C. §
1127.
(6)
A putative trademark infringer thus must prove two separate elements to
interpose the defense of abandonment successfully: that the plaintiff has ceased
using the mark in dispute,
(7)
and that he has done so with an intent not to resume its
use. See Citibank, N.A. v. Citibank Group, Inc.,
724 F.2d 1540, 1545 (11th Cir.
1984); Emergency One, Inc. v. Am. Fireeagle, Ltd.,
228 F.3d 531, 535 (4th Cir.
2000) ("[A] party claiming that a mark has been abandoned must show 'non-use of
the name by the legal owner and no intent by that person or entity to resume use in
the reasonably foreseeable future.'") (quoting Stetson v. Howard D. Wolf &
Assocs.,
955 F.2d 847, 850 (2d Cir. 1992)).
Because proving the subjective intent of a trademark holder may prove
burdensome for a defendant, see Saratoga Vichy Spring Co. v. Lehman, 625 F.2d
1037, 1044 (2d Cir. 1980) ("intent is always a subjective matter of inference"), the
Lanham Act provides two aids for demonstrating intent. First, it provides that
"[i]ntent not to resume may be inferred from circumstances."
15 U.S.C. § 1127;
see also Vitaline Corp. v. Gen. Mills, Inc.,
891 F.2d 273, 275 (Fed. Cir. 1989)
("Although abandonment requires both non-use and intent not to resume use of the
mark, the element of intent can be established inferentially by the same facts that
establish non-use."). Second, it allows a showing of three years of consecutive
nonuse to create a rebuttable presumption of intent not to resume use: "[n]onuse
for 3 consecutive years shall be prima facie evidence of abandonment."
15 U.S.C. § 1127.
(8)
The district court rejected Clear Channel's abandonment defense,
specifically finding that
[c]onsiderable good will accrued to Plaintiff as a result of Plaintiff's
promotion of "The Breeze." Plaintiff has kept up this association
with "The Breeze" and the good will by using "The Breeze" logo on
business cards and the sign at its broadcasting studio. Plaintiff's
continuing commercial use of "The Breeze" goes beyond mere token
use, thus going against a finding of abandonment.
On the basis of these factual findings, and noting that "Defendant bears a strict
burden of proof ," the district court concluded that Clear Channel was "not likely
to succeed on the merits of its abandonment defense."
(9)
Abandonment is a finding
of fact we review only for clear error, see On-Line Careline, Inc. v. America
Online, Inc.,
229 F.3d 1080, 1087 (Fed. Cir. 2000) ("Abandonment is a question
of fact."); Rivard v. Linville,
133 F.3d 1446, 1449 (Fed. Cir. 1998) (same), and we
cannot say the district court's finding is clearly erroneous on the preliminary
record before us.
(10)
Thus, were the district court's factfinding regarding abandonment the only
concern pressed by Clear Channel, we could quickly put the issue to rest. But it is
not. Hoping to circumvent the deferential standard of review afforded factual
findings, Clear Channel asserts that the district court committed legal error in its
allocation of the burden of proof on its abandonment defense. Clear Channel
contends that rather than placing on it "a strict burden of proof," the district court
should have shifted the burden of proof to CMI because Clear Channel had
established a prima facie case of abandonment. Failure to do so, Clear Channel
urges, deviates from the legal framework we set forth in E. Remy Martin for
allocating evidentiary burdens where a prima facie abandonment case has been
established. We are unpersuaded.
First, we note that the burden a defendant bears on the affirmative defense
of abandonment is, in fact, "strict." See Conagra, Inc. v. Singleton, 743 F.2d
1508, 1516 (11th Cir. 1984); Citibank, 724 F.2d at 1545. Because a finding of
abandonment works an involuntary forfeiture of rights,
(11)
federal courts uniformly
agree that defendants asserting an abandonment defense face a "stringent,"
"heavy," or "strict burden of proof." See e.g., Moore Business Forms, Inc. v. Ryu,
960 F.2d 486 (5th Cir. 1992) ("stringent standard of proof"); Lipton Indus., Inc. v.
Ralston Purina Co.,
670 F.2d 1024, 1031, 213 U.S.P.Q. 185, 191 (C.C.P.A. 1982)
("heavy burden"); Seidelmann Yachts, Inc. v. Pace Yacht Corp., 14 U.S.P.Q.2d
1497, 1501 (D.Md. 1989), aff'd 13 U.S.P.Q. 2d 2025 (4th Cir. 1990) ("Because
abandonment constitutes a forfeiture of a property interest, both non-use and intent
not to resume use must be strictly proved.").
(12)
Second, Clear Channel has misapprehended our holding in E. Remy Martin.
In E. Remy Martin, we held that once a defendant establishes a case of prima facie
abandonment, "[t]he burden of proof then shift[s] to [the mark holder] to
demonstrate that circumstances d[o] not justify the inference of intent not to
resume use." 756 F.2d at 1532 (emphases added).
(13)
We did not specify in E.
Remy Martin, nor have we since, what burden of proof shifts to the mark holder
upon a prima facie showing of abandonment -- the burden of production or the
burden of persuasion.
(14)
"The burden of proof typically has two elements: the
burden of producing evidence and the burden of persuading the fact finder."
Abilene Sheet Metal, Inc. v. NLRB, 619
F.2d 332, 339 (5th Cir. 1980).
(15)
Our
choice of language in E. Remy Martin -- "burden of proof . . . to demonstrate" --
can be read as requiring either production or persuasion. Accord Cerveceria
Centroamericana, S.A. v. Cerveceria India, Inc.,
892 F.2d 1021, 1025 (Fed. Cir.
1989) (noting that "burden to demonstrate" can be read either as burden of
production or as burden of ultimate persuasion). Relying on E. Remy Martin in
Ambrit, we held that a prima facie abandonment case shifts to a mark holder "the
burden . . . to establish its intent to resume use," Ambrit, 812 F.2d at 1550
(emphasis added), but "establish" no more clearly corresponds to "produce" or
"persuade" than does "demonstrate."
The legislative history of the Lanham Act is similarly equivocal about what
burden shifts to a mark holder once a prima facie showing of abandonment has
been made.
(16)
Every federal court that has considered the question, however, has
determined that a prima facie case of abandonment shifts only the burden of
production, while leaving the ultimate burden of persuasion always with the
defendant. See, e.g., On-Line Careline, 229 F.3d at 1087 ("Establishing a prima
facie case eliminates the challenger's burden to establish the intent element of
abandonment as an initial part of [his] case, creating a rebuttable presumption that
the trademark owner has abandoned the mark without intent to resume use. The
burden then shifts to the trademark owner to produce evidence that he either used
the mark during the statutory period or intended to resume use. The burden of
persuasion, however, always remains with the petitioner to prove abandonment by
a preponderance of the evidence.") (alteration in original) (citations and quotations
omitted and emphasis added); Emergency One, 228 F.3d at 536 ("Proof of three
consecutive years of non-use thus creates a presumption -- a mandatory inference
of intent not to resume use. Once the presumption is triggered, the legal owner of
the mark has the burden of producing evidence of either actual use during the
relevant period or intent to resume use. The ultimate burden of proof (by a
preponderance of the evidence) remains always on the challenger.") (citations
omitted and emphasis added); Rivard, 133 F.3d at 1449; Roulo v. Russ Berrie &
Co.,
886 F.2d 931, 938 (7th Cir. 1989) ("However, in contradiction to defendant's
contention that the plaintiff must also bear the burden of persuasion on this
affirmative defense, the owner of the trademark need only produce evidence to
rebut the presumption while the ultimate burden of persuasion rests on the
defendant.") (emphasis added); Societe de Developments et D'Innovations des
Marches Agricoles et Alimentaires-Sodima-Union de Cooperatives Agricoles v.
Int'l Yogurt Co., 662 F. Supp. 839, 845 (D. Or. 1987); see also Abdul-Jabbar, 85
F.3d at 411 n.4 ("[I]n . . . the Ninth, Second and Seventh [circuits], prima facie
abandonment creates only a rebuttable presumption of abandonment.").
We agree with the Federal Circuit, see Cerveceria Centroamericana, 892
F.2d at 1026, that, given the lack of evidence of Congress's clear intent to the
contrary, this approach better comports with Rule 301 of the Federal Rules of
Evidence, which provides that
In all civil actions and proceedings not otherwise provided for by Act
of Congress or by these rules, a presumption imposes on the party
against whom it is directed the burden of going forward with
evidence or to rebut or meet the presumption, but does not shift to
such party the burden of proof in the sense of the risk of
nonpersuasion, which remains throughout the trial upon the party
upon whom it was originally cast.
Fed R. Evid. 301 (emphases added). Accordingly, we hold that the ultimate
burden of persuasion on the issue of abandonment remains with the defendant, and
we can discern nothing to the contrary in E. Remy Martin.
In short, the district court was correct to leave the ultimate burden of proof -- and a "strict" one at that -- with Clear Channel. See Conagra, 743 F.2d at 1516;
Citibank, 724 F.2d at 1545. On this preliminary record, then, the very most Clear
Channel can say is that it met its burden of production on abandonment, and
thereby shifted the burden of going forward to CMI. Even if the burden of
production did shift, however, CMI plainly met it by introducing evidence of its
continued use of "The Breeze" -- the business cards, the billboard, and the
promotional materials. Weighing all of the evidence submitted by both sides, the
district court made the critical factual finding that CMI had not abandoned "The
Breeze." We can find no legal error in the district court's analysis, nor can we say
that its factfinding was clearly erroneous.
(17)
B.
Clear Channel's second argument on appeal is that the district court abused
its discretion by failing to hold a second hearing after issuing the preliminary
injunction so that it could introduce additional evidence. An evidentiary hearing
is required for entry of a preliminary injunction only "where facts are bitterly
contested and credibility determinations must be made to decide whether
injunctive relief should issue." McDonald's Corp. v. Robertson,
147 F.3d 1301,
1312 (11th Cir. 1998) (citing All Care Nursing Serv., Inc. v. Bethesda Memorial
Hosp., Inc.,
887 F.2d 1535, 1538 (11th Cir. 1989)) (other citations omitted). In
this case, there is "little dispute as to raw facts," id. at 1313 (quoting Jackson v.
Fair,
846 F.2d 811, 819 (1st Cir. 1988)); that is, both parties agree that the
billboard outside of CMI's offices, CMI's business cards, and some of CMI's
promotional materials continue to bear "The Breeze" name and logo after WBZE's
name change. There is, however, "much [dispute] as to the inferences" to be
drawn from these raw facts. Id. (quoting Jackson, 846 F.2d at 819). In such a
situation, we have adopted an "approach to determine whether an evidentiary
hearing is necessary that 'leave[s] the balancing between speed and practicality
versus accuracy and fairness to the sound discretion of the district court.'" Id.
(alteration in original) (quoting Jackson, 846 F.2d at 819).
Here, the district court held an evidentiary hearing and allowed the parties
the opportunity to submit supplemental evidence after the hearing before issuing
the injunction. Nevertheless, Clear Channel contends that, because it was unable
to find and prepare witnesses in time for the first hearing, the district court should
be compelled to give it another bite at the apple. But "where a party attempts to
introduce previously unsubmitted evidence on a motion to reconsider, the court
should not grant the motion absent some showing that the evidence was not
available during the pendency of the motion." Mays v. U.S. Postal Serv., 122 F.3d
43, 46 (11th Cir. 1997). Clear Channel has made no such showing. Accordingly,
we cannot say that the district court abused its discretion by denying Clear
Channel a second hearing.
C.
Clear Channel's third and final argument on appeal is that the district
court's injunction is overbroad because it prohibits Clear Channel from making
any use of "The Breeze," even what it dubs "curative uses" designed to dispel
confusion Clear Channel may create by its on-air identification of WTLY as "The
Breeze." While a preliminary injunction must be "narrowly tailored to fit specific
legal violations, because the district court should not impose unnecessary burdens
on lawful activity," Starter Corp. v. Converse, Inc.,
170 F.3d 286, 299 (2d Cir.
1999) (citations and punctuation omitted), the district court was under no
obligation to permit Clear Channel to use "The Breeze" as it seeks to do and we
cannot say it erred in failing to do so. Curative steps are sometimes required when
a new user wants to use a mark that has been abandoned but is still associated by
the public with its former holder.
(18) In such a case,
the preventive measures are a
condition on the use of the mark by the new user. A court need not permit
curative steps to an infringer treading upon the protectable rights of a current user.
Even if the uses of "The Breeze" for which Clear Channel seeks permission
-- such as identifying WTLY as "The Breeze 107.1" or "The New Breeze" --
would not infringe CMI's rights in the name, the district court was well within the
bounds of its discretion to deny Clear Channel those uses. "An injunction can be
therapeutic as well as protective. In fashioning relief against a party who has
transgressed the governing legal standards, a court of equity is free to proscribe
activities that, standing alone, would have been unassailable." Ambrit, 812 F.2d at
1548 (quoting Kentucky Fried Chicken Corp. v. Diversified Packaging Corp., 549
F.2d 368, 390 (5th Cir. 1977)); see also Indianapolis Colts, 34 F.3d at 416 (finding
argument analogous to Clear Channel's "baffl[ing]"); Chevron Chem. Co. v.
Voluntary Purchasing Groups, Inc.,
659 F.2d 695, 705 (5th Cir. Unit A Oct. 23,
1981) ("[A] competitive business, once convicted of unfair competition in a given
particular, should thereafter be required to keep a safe distance away from the
margin line -- even if that requirement involves a handicap as compared with those
who have not disqualified themselves.") (emphasis added) (quoting Broderick &
Bascom Rope Co. v. Manoff,
41 F.2d 353, 354 (6th Cir. 1930)). The district court
was thus well within the bounds of its discretion in shaping the contours of the
injunction and we will not second guess its judgment.
AFFIRMED.
FOOTNOTES
* Honorable John P. Fullam, U.S. District Judge for the Eastern District of
Pennsylvania, sitting by designation.
1. During the October 24 hearing, Clear Channel's counsel conceded that "if
they [CMI] were still using The Breeze, they could stop us. I wouldn't be up here
arguing to the contrary." Clear Channel's position is that, because CMI has
abandoned "The Breeze," it cannot succeed on the merits of its infringement
claim. Clear Channel raised no argument in the district court regarding the other
three prongs of the familiar preliminary injunction standard and does not challenge
the district court's findings under them on appeal. See CBS Broad., Inc. v. Echostar
Communications Corp.,
265 F.3d 1193, 1200 (11th Cir. 2001) (to merit
preliminary injunctive relief, movant must show that: (1) it has substantial
likelihood of success on the merits; (2) it will suffer irreparable injury unless
injunction issues; (3) threatened injury to movant outweighs possible injury
injunction may cause opposing party; and (4) injunction would not disserve public
interest) (citing Siegel v. LePore,
234 F.3d 1163, 1176 (11th Cir. 2000) (en banc)).
2. We focus only on federal law, because our analysis of CMI's Lanham Act
claim renders unnecessary any consideration of CMI's FDUTPA claims at this
stage of the case. See Lucas v. W.W. Grainger, Inc.,
257 F.3d 1249, 1256 (11th
Cir. 2001) ("[W]e may affirm [the district court's] judgment 'on any ground that
finds support in the record.'") (quoting Jaffke v. Dunham,
352 U.S. 280, 281, 77
S. Ct. 307, 308, 1 L. Ed. 2d 314 (1957)); see also Ambrit, 812 F.2d at 1535 n.6
("[B]ecause of our disposition of the federal claims, we need not review the
district court's handling of the state law claims."). The two elements CMI must
prove under § 43(a) are that it has rights in "The Breeze" name and that those
rights have been violated by a confusingly similar use of the name by Clear
Channel. See Conagra, Inc. v. Singleton,
743 F.2d 1508, 1512 (11th Cir. 1984).
3. While it appears that CMI has not registered "The Breeze" and thus cannot
proceed under § 32 of the Lanham Act,
15 U.S.C. § 1114, it nonetheless may
proceed under § 43(a),
15 U.S.C. § 1125, if it has made use of the mark in
commerce. See Montgomery v. Noga,
168 F.3d 1282, 1297 n.24 (11th Cir. 1999)
("It is well settled . . . that registration is not a prerequisite to an action under
section 43(a).") (citing Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768,
112 S. Ct. 2753, 2757, 120 L. Ed. 2d 615 (1992)); Planetary Motion, Inc. v.
Techsplosion, Inc.,
261 F.3d 1188, 1193 n.5 (11th Cir. 2001) ("'In the absence of
registration, rights to a mark traditionally have depended on the very same
elements that are now included in the statutory definition: the bona fide use of a
mark in commerce that was not made merely to reserve a mark for later
exploitation.'") (quoting Allard Enters., Inc. v. Advanced Programming Res., Inc.,
146 F.3d 350, 357 (6th Cir. 1998)).
4. See Coach House Rest., Inc. v. Coach & Six Rests., Inc.,
934 F.2d 1551,
1559-60 (11th Cir. 1991) (inherently distinctive marks -- which include arbitrary
or fanciful marks and suggestive marks -- are protectable under the Lanham Act
without a showing of secondary meaning).
5. Likelihood of confusion is a finding of fact subject only to clear error
review. See E. Remy Martin, 756 F.2d at 1529 ("In this circuit, a determination of
likelihood of confusion . . . is a matter of fact that we may overturn only if clearly
erroneous.") (citing Safeway Stores, Inc. v. Safeway Disc. Drugs, Inc., 675 F.2d
1160, 1163 (11th Cir. 1982)). To determine likelihood of confusion, a court looks
to seven factors: "(1) the strength of the plaintiff's mark; (2) the similarity
between the plaintiff's mark and the allegedly infringing mark; (3) the similarity
between the products and services offered by the plaintiff and defendant; (4) the
similarity of the sales method; (5) the similarity of advertising methods; (6) the
defendant's intent, e.g., does the defendant hope to gain competitive advantage by
associating his product with the plaintiff's established mark; and (7) actual
confusion." Alliance Metals, Inc. v. Hinley Indus., Inc.,
222 F.3d 895, 907 (11th
Cir. 2000). "The most persuasive evidence in assessing the likelihood of
confusion is proof of actual confusion." Id. The district court here found that
"[t]he likelihood of confusion factors weigh in Plaintiff's favor. Specifically,
WBZE continued to be known as 'The Breeze' in the Tallahassee area. Defendant
has adopted the same name and a strikingly similar mark for WTLY. WBZE and
WTLY are directly competing stations, in the same geographic area, offering
similar music formats directed to substantially the same audience. Defendant
adopted the name 'The Breeze' and copied Plaintiff's trading style to increase its
ratings and profit from false public association of Defendant's radio broadcasting
services with the services offered by Plaintiff. There has also been actual
confusion." On the evidence presented to the district court at the preliminary
injunction hearing, these conclusions are not clearly erroneous.
6. The definition of abandonment given in § 1127 reads in full:
A mark shall be deemed to be "abandoned" if either of the
following occurs:
(1) When its use has been discontinued with intent
not to resume such use. Intent not to resume may be
inferred from circumstances. Nonuse for 3 consecutive
years shall be prima facie evidence of abandonment.
"Use" of a mark means the bona fide use of such mark
made in the ordinary course of trade, and not made
merely to reserve a right in a mark.
(2) When any course of conduct of the owner,
including acts of omission as well as commission, causes
the mark to become the generic name for the goods or
services on or in connection with which it is used or
otherwise to lose its significance as a mark. Purchaser
motivation shall not be a test for determining
abandonment under this paragraph.
15 U.S.C. § 1127.
7. "Use" as contemplated by the definition of abandonment in 15 U.S.C. §
1127 requires more than mere token use: "'Use' of a mark means the bona fide use
of such mark made in the ordinary course of trade, and not made merely to reserve
a right in a mark."
8. Prior to January 1, 1996,
nonuse for two consecutive years was prima facie
evidence of an intent not to resume use. Pursuant to the Uruguay Round
Agreements Act, § 45 of the Lanham Act,
15 U.S.C. § 1127, was amended,
effective January 1, 1996, to require evidence of nonuse for three consecutive
years to establish a prima facie case of abandonment. See Uruguay Round
Agreements Act, Pub. L. No. 103-465, § 521, 108 Stat. 4809, 4981-82 (1994).
9. The district court also
rejected Clear Channel's abandonment defense to
CMI's FDUTPA claims: "Defendant's affirmative defense of 'abandonment' gives
it no license to mislead consumers in the State of Florida in violation of the
FDUTPA."
10. Admittedly, evidence of CMI's use of "The Breeze" after WBZE's
September 2000 name change was limited, consisting largely of a logo on a
billboard, some business cards, and a few promotional materials, but it was
sufficient to enable the trial court to reject Clear Channel's abandonment defense.
This does not foreclose the possibility that, on a full record, the court may find
that these items are simply vestigial holdovers from CMI's "Breeze" regime,
evincing merely a haphazard transition to use of the "Star 98" name rather than an
intent to continue using "The Breeze." But for our purposes today, the district
court, after reviewing the evidence determined that these items were not merely
vestigial and were instead part of CMI's active use of "The Breeze." The district
court did not commit clear error in making this finding of fact.
11. If it were a voluntary forfeiture, there would be no litigation. See Imperial
Tobacco Ltd. v. Philip Morris, Inc.,
899 F.2d 1575, 1581 (Fed. Cir. 1990) ("In
every contested abandonment case, the respondent denies an intention to abandon
its mark; otherwise there would be no contest.").
12. There is disagreement about what this "strict burden" is. The Federal
Circuit has held that it is nothing more than a talismanic phrase, requiring merely
the preponderance of the evidence required to prevail on other civil issues. See,
e.g., Cerveceria Centroamericana, S.A. v. Cerveceria India, Inc.,
892 F.2d 1021,
1024 (Fed. Cir. 1989) ("[W]e are unable to discern from the legislative history of
the Lanham Act any intention by Congress to raise the burden of proof for . . .
abandonment above the normal civil burden of a preponderance of the evidence.").
Other courts have held that it requires proof by clear and convincing evidence.
See, e.g., Emmpresa Cubana Del Tabaco v. Culbro Corp., -- F. Supp. 2d --, 2002
WL 1398563, *15 (S.D.N.Y. June 26, 2002) ("Because it constitutes a forfeiture
of a property right, abandonment of a mark must be proven by clear and
convincing evidence, and statutory aid to such proof must be narrowly
construed.") (citations omitted); Chere Amie, Inc. v. Windstar Apparel, Corp., 191
F. Supp.2d 343, 349 (S.D.N.Y. 2001) ("A defense of abandonment must be proven
by clear and convincing evidence.") (citations omitted); see generally McCarthy,
supra, § 17:12 ("Since abandonment results in a forfeiture of rights, the courts are
reluctant to find an abandonment. Â… [E]vidence of the elements of abandonment
must be clear and convincing."). We have not had occasion to give detailed
meaning to the term "strict burden," and need not do so now, because the outcome
of this case is plainly the same whether we define a "strict burden" as requiring
"clear and convincing evidence" or only a "preponderance of the evidence."
13. A prima facie showing simply means "evidence of such nature as is
sufficient to establish a fact and which, if unrebutted, remains sufficient for that
purpose." Hiram Walker & Sons, Inc. v. Kirk Lines, R. B. Kirkconnell & Bro.,
Ltd.,
963 F.2d 327, 331 n.5 (11th Cir. 1992) (quoting Miller v. Norvell, 775 F.2d
1572, 1574 (11th Cir. 1985)); see also Tex. Dep't of Cmty. Affairs v. Burdine, 450
U.S. 248, 254 n.7, 101 S. Ct. 1089, 1094 n.7, 67 L. Ed. 2d 207 (1981) ("The
phrase 'prima facie case' . . . describe[s] the plaintiff's burden of producing
enough evidence to permit the trier of fact to infer the fact at issue.").
14. It was unnecessary to resolve this question on the specific facts of E.
Remy Martin, because we found that the mark holder could not meet even a burden
of production, let alone a burden of persuasion. See 756 F.2d at 1532-33.
15. In Bonner v. City of
Prichard,
661 F.2d 1206, 1209 (11th Cir. 1981) (en
banc), this Court adopted as binding precedent all of the decisions of the former
Fifth Circuit handed down prior to the close of business on September 30, 1981.
16. See
Cerveceria Centroamericana, 892 F.2d at 1025 n.4 (citing Trade-marks: Hearings on H.R. 82 Before the House Comm. on Patents, 78th Cong. 24
(1944) ("The bill provides that discontinuance of use for 2 consecutive years shall
be prima facie abandonment. It would shift the burden to the registrant.")
(testimony of Daphne Robert, Esq.)).
17. Clear Channel also argues that CMI's
public announcement of its name change
alone establishes a prima facie case of abandonment. While such an
announcement is the type of circumstance from which intent not to resume use
may be inferred, see McCarthy, supra, §17:11 ("An intent not to resume use might be
explicitly stated in advertising, as where a company advertises that 'We Are
Changing Our Name from ALPHA to ZETA. Don't Call Us ALPHA any
more.'"); Hiland Potato Chip Co. v. Culbro Snack Foods, Inc., 585 F. Supp. 17, 22 (S.D. Iowa
1982); Emergency One, 228 F.3d at 540, it does not alone serve to make a prima
facie showing of abandonment. A defendant must also introduce evidence of
nonuse.
18. See Restatement (Third) of Unfair Competition § 30 cmt. a (1990) ("A
designation that has been abandoned §17:2 ("[B]ecause their subsequent use of the
abandoned mark may well evoke a continuing association with the prior user,
those who make subsequent use may be required to take reasonable precautions to
prevent confusion.").