Thane International, Inc. v. Trek Bicycle Corporation
305 F.3d 894 (2002)
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Rule of Law:
Survey evidence demonstrating that an appreciable number of consumers are actually confused can be sufficient to create a genuine issue of material fact regarding the likelihood of confusion, precluding summary judgment. For a federal trademark dilution claim to succeed with broad protection, the mark must be famous among the general consuming public, not merely within a specialized niche market.
Facts:
- Since 1977, Trek Bicycle Corporation ('Trek') has manufactured and sold bicycles under the 'TREK' mark.
- Trek expanded its brand to over 1,000 products, including bicycle accessories and clothing, and is recognized as one of the country's most popular bicycle brands.
- From 1993 to 1996, Trek sold stationary exercise bikes under the TREK mark before selling that product line to another company, whose license to use the mark expired in 1997.
- Thane International, Inc. ('Thane'), a direct response marketing company, developed a stationary elliptical glider exercise machine in 1997.
- In December 1997, Thane began selling its product under the name 'OrbiTrek' through television infomercials.
- Thane stated the 'Trek' portion of its name was inspired by the 'Star Trek' television show and that its employees were unaware of Trek bicycles.
- Thane did not perform a trademark search before adopting and using the 'OrbiTrek' name.
- In 1998, Trek began developing a new stationary trainer product that would allow a user to convert their mobile bicycle into a stationary one.
Procedural Posture:
- Thane International filed an application with the U.S. Patent and Trademark Office to register the 'ORBITREK' mark.
- Trek Bicycle Corporation filed a Notice of Opposition with the Trademark Trial and Appeal Board.
- Thane then filed a complaint in the U.S. District Court for the Central District of California, seeking a declaratory judgment that it had not violated trademark laws.
- Trek filed a counterclaim asserting trademark infringement, federal and state trademark dilution, and unfair competition.
- Both parties filed cross-motions for summary judgment in the district court.
- The district court granted summary judgment for Thane, holding that no reasonable juror could find a likelihood of confusion, and denied Trek's motion.
- The district court denied a subsequent motion by Thane for attorney's fees.
- Trek appealed the grant of summary judgment to Thane and the denial of its own summary judgment motion to the U.S. Court of Appeals for the Ninth Circuit.
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Issue:
Is there a genuine issue of material fact regarding the likelihood of confusion between Trek Bicycle Corporation's 'TREK' mark and Thane International's 'OrbiTrek' mark, making summary judgment on the trademark infringement claim inappropriate?
Opinions:
Majority - Berzon, Circuit Judge
Yes. A genuine issue of material fact exists regarding the likelihood of confusion between the two marks, which makes summary judgment for either party on the infringement claim inappropriate. With respect to the trademark infringement claim, summary judgment for Thane was improper because Trek presented sufficient evidence of actual confusion to warrant a trial. Trek's survey, which concluded that 27.7% of respondents were confused as to the source of the OrbiTrek, constitutes persuasive proof from which a reasonable jury could find a likelihood of confusion. Conversely, summary judgment for Trek was also properly denied because a reasonable jury could find the marks are not similar (due to the 'Orbi' prefix and different length) and that the products are not sufficiently related (mobile bicycles versus elliptical gliders, with Trek's stationary bike venture being short-lived). Regarding the dilution claim, summary judgment for Thane was proper. The Federal Trademark Dilution Act requires a mark to be 'famous.' While TREK may be famous within the niche market of bicycle enthusiasts, it failed to produce any evidence that it is famous among the general consuming public. For broad protection against dilution across different markets, a mark must be a 'household name,' a standard TREK did not meet.
Analysis:
This decision clarifies two distinct paths in trademark litigation. First, it reinforces that credible survey evidence of actual confusion is a powerful tool for plaintiffs to defeat summary judgment motions in infringement cases, emphasizing that the likelihood of confusion is a factual inquiry best left to a jury. Second, the opinion significantly refines the 'famousness' requirement for federal dilution claims, creating a critical distinction between 'niche fame' and general fame. By requiring a mark to be a 'household name' for broad protection, the court sets a very high bar for dilution claims, thereby preventing the statute from being used to grant 'rights in gross' and hampering competition.
