Supreme Court Overturns the 9th Circuit and INKS a Decision on the Fair Use of Dye Names
The U.S. Supreme Court has clarified a split in the circuit courts and limited to scope of protection a federally registered mark may have in a trademark infringement case. In Lasting Impressions, Inc. v. KP Permanent, the high court wrote, in its unanimous decision, that a defendant claiming fair use (based upon a descriptiveness defense) of a third party’s registered trademark need not show a lack of consumer confusion in order to prevail. Indeed, even in cases where some confusion does exist, it will not be dispositive of trademark infringement by the junior user. Writing for the court, Justice Souter noted that “Some possibility of consumer confusion must be compatible with fair use,” effectively shifting the burden of showing trademark infringement against a descriptiveness defense to the plaintiff.
The case involved two companies that make liquid pigments used in cosmetics. Lasting Impression, Inc. (”LI”) had an incontestable registered trademark for the mark MICRO COLORS (stylized), under which it sells the permanent inks. The defendant, KP Permanent (”KP”), also makes cosmetic dyes. Beginning in 1999, KP started using the words “micro colors” on its products and printed matter. Shortly thereafter, KP received a cease and desist letter from LI, alleging trademark infringement and demanding that KP remove the words “micro colors” from its packaging and products. KP responded, filing a declaratory relief action alleging fair use of the words and asserting that the descriptive use of the words “micro colors” in the cosmetic industry predated LI’s trademark registration.
A federal trial judge, no doubt following similar cases handed down in the Second Circuit, found in favor of KP and held that its use of the term “micro colors” was allowable as descriptive use. On appeal, the Ninth Circuit reversed the lower court, stating that a defendant was required to show that consumers were not confused by the use of the terms in a descriptive sense, effectively establishing a conflict between it and the Second Circuit. The Supreme Court appears to have sided with the Second Circuit in this matter, and found that no showing of lack of confusion is necessary to make a fair use defense.
Given the holding of the Supreme Court in this case, plaintiff’s may have a more difficult time showing that a competitor’s use of terms that are similar or identical to a registered trademark constitutes trademark infringement. One hopes, however, that common sense will prevail in the event there is actual and substantial confusion in the marketplace.