Cross Commerce Media, Inc. v. Collective, Inc.
841 F.3d 155, 2016 WL 6575071 (2016)
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Rule of Law:
A trademark is suggestive, not descriptive, if it requires imagination, thought, or perception for a consumer to reach a conclusion about the nature of the goods. The distinction hinges on the immediacy of the association between the mark and the product; if a mental leap is required, the mark is suggestive and entitled to protection without proof of secondary meaning.
Facts:
- Collective, Inc. (CI), incorporated in 2007, provides data-driven analytic software to help businesses with marketing.
- Between 2008 and 2011, CI registered the trademarks 'Collective Network,' 'Collective Video,' and 'C Collective The Audience Engine.'
- During this period, starting in late 2008, CI acquired the domain name www.collective.com for its main website and began referring to itself as 'Collective' in some instances.
- Cross Commerce Media, Inc. (CCM), also founded in 2007, provides a similar type of data-driven analytic software for marketing campaigns.
- In 2011, CCM began operating under the mark 'Collective[i]' and related marks.
- In late 2011, CI contacted CCM to express concern that CCM's use of 'Collective[i]' would cause confusion between the two companies.
- After negotiations failed, CI sent CCM a cease-and-desist letter in late 2012 asserting trademark infringement.
Procedural Posture:
- Cross Commerce Media, Inc. (CCM) filed an action against Collective, Inc. (CI) in the U.S. District Court for the Southern District of New York, seeking a declaratory judgment of non-infringement.
- CI filed counterclaims against CCM for infringement of its registered and unregistered trademarks under the Lanham Act.
- On CCM's motion for partial summary judgment, the district court ruled in its March Order that CI's unregistered mark 'collective' was descriptive as a matter of law.
- In its August Order, the district court granted summary judgment for CCM, dismissing CI's counterclaim regarding the unregistered mark for lack of secondary meaning and prior use, and also dismissed the counterclaim for infringement of the registered marks.
- In its December Order, the district court granted CCM's motion to compel cancellation of two of CI's registered marks on the ground of abandonment and awarded attorney's fees to CCM.
- CI (Appellant) appealed the district court's three summary judgment orders to the U.S. Court of Appeals for the Second Circuit, with CCM as the Appellee.
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Issue:
Does a trademark that describes a general attribute of a product, but which could also plausibly describe a wide variety of other products and requires a mental leap to connect to the specific goods, qualify as a suggestive mark entitled to protection without proof of secondary meaning?
Opinions:
Majority - Sack, Circuit Judge
Yes, a trademark that requires a mental leap to connect it to the specific goods is suggestive and protectable without proof of secondary meaning. The court distinguishes between descriptive marks, which convey an 'immediate idea of the ingredients, qualities or characteristics of the goods,' and suggestive marks, which require consumers to use 'imagination, thought and perception.' The district court erred by equating the mere fact of an association between the word 'collective' and CI's services with the immediacy of that association. Because the word 'collective' could describe a wide range of unrelated enterprises (e.g., search engines, investment advisers, collective farms), an average consumer must make a substantial mental leap to connect the mark specifically to CI's data-driven marketing tools. Therefore, the mark 'collective' is suggestive as a matter of law and is entitled to trademark protection without a showing of secondary meaning.
Analysis:
This decision reinforces the distinction between descriptive and suggestive trademarks, clarifying that the critical factor is the 'mental leap' required by a consumer, not simply whether an association exists between the mark and the product. By classifying 'collective' as suggestive as a matter of law, the court significantly lowers the evidentiary burden for CI on remand, as it no longer needs to meet the 'rigorous evidentiary requirements' of proving secondary meaning. The ruling serves as a strong precedent for protecting marks that are broadly evocative of a product's qualities, strengthening the position of trademark holders whose marks are clever but not directly descriptive.
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