Brunswick Corp. v. Spinit Reel Co.

832 F.2d 513, 56 U.S.L.W. 2264
CourtCourt of Appeals for the Tenth Circuit
DecidedOctober 15, 1987
DocketNos. 84-2581, 84-2624
StatusPublished
Cited by121 cases

This text of 832 F.2d 513 (Brunswick Corp. v. Spinit Reel Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Tenth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Brunswick Corp. v. Spinit Reel Co., 832 F.2d 513, 56 U.S.L.W. 2264 (10th Cir. 1987).

Opinion

McKAY, Circuit Judge.

Appellant Brunswick Corporation is a Delaware corporation with its principal place of business in Skokie, Illinois. Zebco is a division of Brunswick which manufactures and sells fishing equipment, including spin-cast reels and tackle combinations. Zebco’s most popular reel is the Zebco Model 33.

Don Mclntire, a longtime employee of Zebco, left the division on January 1, 1982. Some months later Mr. Mclntire, with a few friends and associates, started a business to manufacture and market closed face spin-cast fishing reels. Spinit Reel, the resulting company, began manufacture and sales of the SR 210 reel by February 1983.

Zebco developed the concept of the closed face spin-cast reel, and the Zebco Model 33, introduced in 1954, differs in appearance from any spin-cast reel in the market except the SR 210. The Zebco has a distinctive profile with a chrome, cone-shaped front cover, a “stubby” back cover and a black and chrome finish. See Appendices 1 & 2.

In mid-February 1983, Spinit was notified of Zebco’s concern that the SR 210 violated Zebco’s rights under the Lanham Act and other laws. Zebco requested that Spinit stop producing the SR 210 in its present form and change the front and back covers to avoid confusion. The parties attempted to negotiate changes in the design, and Zebco proposed seven different front covers for Spinit to use, but the parties failed to reach any agreement. Spinit did, however, subsequently make some changes to the shape of the SR 210.

Brunswick filed a complaint against Spin-it and Mr. Mclntire on March 17, 1983, charging that Spinit had engaged in unfair competition by manufacturing the SR 210 which had been deliberately copied from the Zebco Model 33 reel. In June, Brunswick applied for a preliminary injunction which the trial court denied, and set trial for the following September. On October 18, 1984, more than a year after trial, the district court ruled that sales of both versions of the SR 210 violated the Lanham Act and enjoined Spinit from further manufacture of either version of the SR 210 or anything identical or confusingly similar to the Zebco Model 33. The court also ordered Spinit to recall all models of the SR 210. The court declined to award Brunswick damages or attorney’s fees.

Brunswick appeals from the trial court’s ruling that Spinit did not violate the Oklahoma Deceptive Trade Practices Act, that the court denied Brunswick damages and attorney’s fees under the Lanham Act and the Oklahoma Act as well as the court’s denial of Brunswick’s motion for discovery of post-trial damages for the year after the trial but before the court’s decision was issued. Brunswick also appeals the court’s failure to award damages to Brunswick for Spinit’s failure to pay royalties under a licensing agreement.

Spinit cross-appeals, seeking reversal of the court’s ruling that Spinit violated the Lanham Act, the imposition of the injunction and the refusal to bar Brunswick’s action under a theory of laches.

I. Lanham Act

Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a) (1982), affords a civil action for a party injured by a competitor’s “false designation of origin” on its product.1 The injured party may sue if it be[517]*517lieves it has or will suffer damages because the competitor’s product or packaging is so similar as to confuse purchasers of the product’s source. See LeSportsac, Inc. v. K Mart Corp., 764 F.2d 71, 75 (2d Cir.1985). Although the party may not have a federally registered trademark, the product may have an image or look, referred to as “trade dress,” that is so distinctive as to become an unregistered trademark eligible for protection under the Lanham Act. Id. “Although historically trade dress infringement consisted of copying a product’s packaging, ... ‘trade dress’ in its more modern sense [may] refer to the appearance of the [product] itself_” American Greetings Corp. v. Dan-Dee Imports, Inc., 807 F.2d 1136, 1140 (3d Cir.1986) (quoting Ideal Toy Corp. v. Plawner Toy Mfg. Corp., 685 F.2d 78, 80 n. 2 (3d Cir.1982)). Generally, to be eligible for protection, the product’s “trade dress” must be nonfunctional and have acquired a secondary meaning.2 If the trade dress is eligible for protection, to recover under the Lanham Act the plaintiff must further establish that there is a likelihood of confusion between the products. J.M. Huber Corp. v. Lowery Wellheads, Inc., 778 F.2d 1467, 1470 (10th Cir.1985).

In its appeal, Spinit challenges the trial court’s conclusion that Spinit’s production and sale of the SR 210 violated the Lanham Act on two grounds: (1) Brunswick did not demonstrate that the front cover design of the Zebco Model 33 was nonfunctional; and (2) Brunswick failed to show a likelihood of confusion between the products.

A. Functionality

Spinit first charges that, in its determination of whether the Zebco Model 33 was protected, the trial court applied the wrong test to determine functionality. The trial court used the following standard: “The configuration of a product is functional and copying is allowed only if that particular configuration is essential to the use or purpose of the product or if an adverse effect on cost or quality would result if that configuration were not used.” Amended Findings of Fact and Conclusions of Law, record, vol. 1, at 493-94 (citing Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 456 U.S. 844, 850 n. 10, 102 S.Ct. 2182, 2187 n. 10, 72 L.Ed.2d 606 (1982)). In the Inwood Laboratories case, the Supreme Court stated the standard for determining functionality only “in general terms,” and that in dictum. Nor has this court defined the standard for determining functionality. Thus, we are faced with an issue of first impression.

Spinit urges that the district court should have applied an expansive definition of functionality as first articulated in Pagliero v. Wallace China Co., 198 F.2d 339 (9th Cir.1952):

If the particular feature is an important ingredient in the commercial success of the product, the interest in free competition permits its imitation in the absence of a patent or copyright. On the other hand, where the feature or, more aptly, design, is a mere arbitrary embellishment, a form of dress for the goods primarily adopted for purposes of identi[518]*518fication and individuality and, hence, unrelated to basic consumer demands in connection with the product, imitation may be forbidden where the requisite showing of secondary meaning is made. Under such circumstances, since effective competition may be undertaken without imitation, the law grants protection.

Id. at 343 (citations omitted). To support its argument, Spinit cites several cases in the Second and Ninth Circuits which examine whether a product feature is an important ingredient in the product’s commercial success to determine functionality. See, e.g., Industria Arredamenti Fratelli Saporiti v. Charles Craig, Ltd., 725 F.2d 18, 19 (2d Cir.1984); International Order of Job’s Daughters v. Lindeburg & Co., 633 F.2d 912, 917 (9th Cir.1980), cert.

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Bluebook (online)
832 F.2d 513, 56 U.S.L.W. 2264, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brunswick-corp-v-spinit-reel-co-ca10-1987.