Savin Corporation v. The Savin Group, et al.
391 F.3d 439 (2004)
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Rule of Law:
Under the Federal Trademark Dilution Act (FTDA), a plaintiff who owns a famous senior mark can satisfy the 'actual dilution' element of a claim by showing the defendant's commercial use of an identical junior mark, which serves as sufficient circumstantial evidence of dilution.
Facts:
- Savin Corporation, founded in 1959, markets and sells business equipment and services under the 'SAVIN' trademark, which is incontestable for several product categories.
- Savin Corporation is a large company with annual revenues over $675 million and significant advertising expenditures, including in major national magazines.
- Dr. Rengachari Srinivasaragahavan, nicknamed 'Nivas,' founded The Savin Group and Savin Engineers to provide professional engineering consulting services.
- Dr. Nivas chose the name 'Savin' in 1987 by spelling his nickname, 'Nivas,' backwards, without conducting a trademark search.
- Approximately ten years before the lawsuit, Savin Engineers became aware of Savin Corporation's products and services.
- After becoming aware of Savin Corporation's 'savin.com' domain, Savin Engineers registered the domain names 'thesavingroup.com' and 'savinengineers.com'.
- In July 2002, Savin Corporation discovered the domain registrations and sent cease-and-desist letters, which Savin Engineers ignored.
- In May 2003, at a chamber of commerce meeting, a vendor who had previously worked with Savin Engineers mistook a Savin Corporation executive for someone associated with Savin Engineers.
Procedural Posture:
- Savin Corporation sued The Savin Group and its related entities in the U.S. District Court for the Southern District of New York, alleging violations of federal and state trademark dilution laws and federal trademark infringement.
- After the discovery phase, both parties filed cross-motions for summary judgment.
- The District Court granted summary judgment in favor of The Savin Group, dismissing all of Savin Corporation's claims.
- The District Court reasoned that Savin Corporation had failed to produce evidence of 'actual dilution' for its federal claim, that the state claim failed for the same reason, and that there was no likelihood of confusion to support the infringement claim.
- Savin Corporation, as plaintiff-appellant, appealed the District Court's grant of summary judgment to the U.S. Court of Appeals for the Second Circuit.
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Issue:
Does a plaintiff bringing a claim under the Federal Trademark Dilution Act (FTDA) satisfy the 'actual dilution' requirement by showing that the defendant is using a junior mark that is identical to the plaintiff's famous senior mark?
Opinions:
Majority - Miner, J.
Yes. Where a plaintiff can show that a defendant is making commercial use of a junior mark that is identical to the plaintiff's famous senior mark, that showing constitutes sufficient circumstantial evidence to satisfy the 'actual dilution' element of a claim under the Federal Trademark Dilution Act (FTDA). The court interpreted the Supreme Court's decision in Moseley v. V. Secret Catalogue, which requires a showing of 'actual dilution.' The Moseley court noted that direct evidence like consumer surveys is not always necessary, especially in an 'obvious case' where the marks are identical. This court holds that such identity creates a presumption of actual dilution. However, for this presumption to apply, the marks must be truly identical, not merely similar. The court remanded the FTDA claim for the district court to determine if the marks are in fact identical. The court also held that New York's state anti-dilution law requires only a 'likelihood of dilution,' a less stringent standard, and thus the lower court erred in dismissing it based on the failure of the federal claim. Finally, the court affirmed the dismissal of the trademark infringement claim, finding no likelihood of confusion under the Polaroid factors because the parties' services are not proximate, their customers are sophisticated, and there is minimal evidence of actual confusion.
Analysis:
This decision provides a significant clarification of the 'actual dilution' standard under the FTDA following the Supreme Court's ruling in Moseley. By establishing that identity between a famous senior mark and a junior mark creates a presumption of actual dilution, the court created a more practical path for brand owners to protect their marks from identical copying without needing to produce expensive and often-inconclusive consumer surveys. The ruling reinforces the FTDA's purpose of protecting the uniqueness of famous marks from being 'whittled away.' It also highlights the important distinction between the federal 'actual dilution' standard and the less demanding 'likelihood of dilution' standard common in state laws, ensuring that viable state claims are not improperly dismissed alongside federal ones.
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