PRL USA Holdings, Inc. v. United States Polo Ass'n

520 F.3d 109, 86 U.S.P.Q. 2d (BNA) 1022, 75 Fed. R. Serv. 1104, 2008 U.S. App. LEXIS 4539, 2008 WL 564970
CourtCourt of Appeals for the Second Circuit
DecidedMarch 4, 2008
DocketDocket 06-3691-cv
StatusPublished
Cited by37 cases

This text of 520 F.3d 109 (PRL USA Holdings, Inc. v. United States Polo Ass'n) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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PRL USA Holdings, Inc. v. United States Polo Ass'n, 520 F.3d 109, 86 U.S.P.Q. 2d (BNA) 1022, 75 Fed. R. Serv. 1104, 2008 U.S. App. LEXIS 4539, 2008 WL 564970 (2d Cir. 2008).

Opinion

LEVAL, Circuit Judge:

This is an appeal by plaintiff PRL USA Holdings, Inc., holder of the Ralph Lauren trademarks for clothing, from the judgment of the United States District Court for the Southern District of New York (Daniels, /.), denying plaintiffs claims of trademark infringement. PRL has for many years used as a mark on Ralph Lauren clothing a famous logo showing in silhouette a mounted polo player with polo mallet raised. PRL brought this action against the United States Polo Association (“USPA”) and its licensee, Jordache, Ltd., alleging that four logos used by the defendants on a clothing line, each showing a pair of mounted polo players — the so-called “double horsemen marks” — infringed the Ralph Lauren polo player logo.

The four disputed marks include: (1) a solid silhouette of the two horsemen, (2) the same solid silhouette with the letters “USPA” added underneath, (3) an outline of the two horsemen, and (4) the same outline with “USPA” added underneath.

After trial, the jury found that the first logo — the solid double horsemen silhouette without lettering — infringed the plaintiffs trademarks. However, as for the three other marks, the jury found no likelihood of confusion and hence no infringement. The district court entered judgment accordingly.

PRL appeals from the part of the judgment in favor of the defendants on three grounds. First, PRL argues that the district court erred when it allowed the defendants to present evidence of discussions at settlement negotiations between PRL and the USPA. Second, PRL argues that the district court erred by failing to give the jury an instruction that the defendants, as past infringers, were required to maintain a “safe distance” from PRL’s mark. Third, PRL contends that the district court erred when it excluded a document (the so-called “Ralph Rip-Off’ document), which arguably demonstrated intent to compete unfairly by using a confusing trademark. We reject PRL’s contentions and affirm the judgment.

Background

Plaintiff PRL designs, markets, and distributes apparel, home furnishings, fragrances, and accessories under the name Ralph Lauren. It frequently employs as a trademark the polo player symbol, which has appeared on Ralph Lauren clothing since 1972.

Defendant USPA, founded in 1890, is the governing body of the sport of polo in the United States. The USPA promulgates the rules of the sport, sponsors tournaments, and assigns handicaps. Through its wholly-owned subsidiary, United States Polo Association Properties, Inc., the USPA registers trademarks and licenses them to be used for the sale of products. Since 1998, United States Polo Association Properties, Inc., has licensed the right to produce clothing bearing the USPA’s trademarks to Jordache, a manufacturer of clothing.

PRL and the USPA have been in conflict since the 1980s, when the USPA first entered the retail clothing business. As the USPA admits, in the early 1980s it acted irresponsibly in licensing its logos. As a result, in 1984 PRL obtained a judg *112 ment in the United States District Court for the Southern District of New York (Sand, J.) enjoining the USPA from the use of certain marks that infringed PRL’s trademarks. The judgment made clear, however, that the USPA remained free to “conduct[ ] a retail licensing program utilizing ... a mounted polo player or equestrian or equine symbol which is distinctive from the [Ralph Lauren] polo player symbol ....”

The USPA presented evidence at trial supporting its argument that, while the USPA and PRL were engaged in settlement discussions regarding various contested marks in 1996, PRL assured the USPA that it would not object to the USPA’s use of a version of the double horsemen mark. According to the USPA, this assurance prompted it to develop and license a version of the double horsemen mark for use; Jordache subsequently spent over $41 million developing a clothing line bearing the mark. PRL’s witness, its former general counsel, Lee Sporn, denied that PRL had consented to the USPA’s use of a double horsemen mark.

In March 2000, PRL filed this suit against the USPA, Jordache, and related defendants for trademark infringement. In September 2003, after three years of pre-trial litigation, the parties settled a number of their disputes. The settlement agreement left unresolved whether the defendants’ four double horsemen marks infringed PRL’s trademarks. The parties stipulated in the settlement agreement that this claim would be resolved by a jury trial.

The jury trial began on October 3, 2005 and ended on October 20, 2005. At trial, PRL presented evidence that consumers were likely to confuse all four double horsemen marks with Ralph Lauren’s polo player symbol. The defendants presented contrary evidence and also attempted to prove the affirmative defense of estoppel by acquiescence by presenting evidence that PRL had affirmatively consented to the USPA’s use of a version of the double horsemen mark.

PRL objected to this latter evidence of consent on the ground that it consisted of statements made in compromise negotiations, offered to prove the invalidity of its claims, and therefore should be excluded under Federal Rule of Evidence 408. The district court overruled PRL’s objection and admitted the evidence.

Using a special verdict form, the jury rendered the following special verdicts: the jury rejected the defendants’ claim of estoppel by acquiescence. It found that the defendants’ solid double horsemen mark infringed PRL’s registered trademarks. On the other hand, the jury found that the defendants’ three other double horsemen marks — the solid double horsemen with “USPA” subscript, the outline double horsemen, and the outline double horsemen with “USPA” subscript — did not infringe PRL’s trademarks. The district court entered judgment accordingly. This appeal followed.

Discussion

I. Evidence of Compromise Negotiations

The defendants offered the testimony of a former USPA employee, Merle Jenkins, and some corroborating evidence, that during the course of their settlement discussions, PRL gave the USPA consent to use a version of the double horsemen mark and implied that it was not “offensive” to PRL. PRL objected both before and during trial to all such evidence, citing Federal Rule of Evidence 408.

Under Rule 408, in its then-current ver *113 sion, 1 evidence of “conduct or statements made in compromise negotiations” is “not admissible to prove liability for or invalidity of [a] claim or its amount.” The Rule, however, explicitly provided an exception. It “does not require exclusion when the evidence is offered for another purpose.” Fed.R.Evid. 408 (2005).

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520 F.3d 109, 86 U.S.P.Q. 2d (BNA) 1022, 75 Fed. R. Serv. 1104, 2008 U.S. App. LEXIS 4539, 2008 WL 564970, Counsel Stack Legal Research, https://law.counselstack.com/opinion/prl-usa-holdings-inc-v-united-states-polo-assn-ca2-2008.