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Sixth Circuit: No likelihood of confusion between competing wines using same geographic term

September 25, 2007
Post by Blog Staff

In a decision last week, the Sixth Circuit affirmed a district court ruling that use of the mark "Chateau de Leelanau Vineyard and Winery" did not create a likelihood of confusion among consumers with the plaintiff's "Leelanau Cellars" federally-registered mark. "Leelanau" in both marks is a reference to a peninsula in Michigan where the wine is produced. While the district court erred by not affording the plaintiff's geographically descriptive mark the statutory presumption of secondary meaning, the court affirmed the lower court's ruling on the ground that the plaintiff had not demonstrated that a likelihood of confusion between the two marks.More detail of Leelanau Wine Cellars, Ltd. v. Black & Red, Inc. after the jump.The case arose out of a trademark dispute between two Michigan wine producers: the plaintiff Leelanau Wine Cellars, Ltd. ("LWC"), owner of the "Leelanau Cellars" mark, and the defendant Black & Red, Inc. ("B&R"), owner of the "Chateau de Leelanau Vineyard and Winery" mark.Leelanau Cellars Chateau Leelanau Both LWC and B&R own and operate wineries located on the Leelanau Peninsula. The Leelanau Peninsula was designated as an Approved American Viticultural Area in 1981. This designation spawned the Leelanau Peninsula Vintner's Association consisting of 13 wineries, including LWC and B&R. LWC successfully applied for registration of its mark in 1997. B&R registered its mark with the state of Michigan in 2000 and with the USPTO in 2003. B&R choose its name for geographic and personal reasons but admitted prior knowledge that LWC "existed as a winery on the Leelanau Peninsula." After registering its mark with the state of Michigan, LWC filed suit against B&R raising two claims under the Lanham Act in addition to a claim for common law unfair competition and a claim under the Michigan Consumer Protection Act.The Sixth Circuit first addressed the parties' claims as to whether LWC's admittedly geographically descriptive mark possessed secondary meaning, entitling it to trademark protection. The court disagreed with the district court's determination that LWC was not entitled to the benefit of the statutory presumption of validity, and consequently secondary meaning, for registered marks because it did not register the word "Leelanau" alone. Because the district court did not apply the statutory presumption, it did not consider the evidence presented by B&R that there was no secondary meaning. The court ultimately declined to resolve the issue because to do so would require the court "to weigh evidence never properly considered by the district court."The court next turned to the issue of likelihood of confusion. The Sixth Circuit applied its eight factor test in determining whether a likelihood of confusion exists, the factors being:

  1. strength of the senior mark
  2. relatedness of the goods or services
  3. similarity of the marks
  4. evidence of actual confusion
  5. marketing channels used
  6. likely degree of purchaser care
  7. the intent of defendant in selecting the mark; and
  8. likelihood of expansion of the product lines.

Regarding the first factor, the court decided the descriptive mark possessed by LWC was "in the spectrum of distinctiveness, weaker than an arbitrary or fanciful mark." This combined with the fact that LWC's mark is part of the Approved Viticultural Areas designation, rendered "its mark unremarkable." The court also addressed the second and third factors by the marks were not similar and weighed against a finding of a likelihood of confusion. The court said that "[h]ere, the similarities between 'Leelanau Cellars' and 'Chateau de Leelanau Vineyard and Winery' begin and end with the use of the word 'Leelanau.'"The court paid a great deal of attention to evidence of actual confusion, the fourth factor. The court considered a consumer survey submitted by LWC and found that several deficiencies, including a failure to replicate conditions that consumers would encounter in the marketplace, reflected methodological errors which undermined the persuasiveness of the survey. The court ultimately held the survey, along with the remainder of LWC's evidence, did not establish prevalance of actual confusion.Finally, the court found little overlap in the marketing channels used since B&R sold most of its wine through tasting rooms as compared to LWC, which sold the majority of its wine through retailers. The differences in marketing channels used also meant that the likelihood of confusion would be reduced in such environment and a careful purchaser would not "incorrectly assume that it was in fact purchasing wine from LWC. The court concluded its analysis by finding that the district court did not erroneously conclude that B&R did not select its name in hopes of creating confusion with the "Leelanau Cellars" mark and that B&R did not plan to expand its product lines.To read the full decision in Leelanau Wine Cellars, Ltd. v. Black & Red, Inc., click here.


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