Xtreme Lashes, LLC v. Xtended Beauty, Inc.

• Decision Date: 15 July 2009
• Docket Number: No. 08-20578.,08-20578.
• Citation: 576 F.3d 221
• Parties: XTREME LASHES, LLC; Joumana Mousselli, Plaintiffs-Appellants, v. XTENDED BEAUTY, INC., Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

576 F.3d 221

XTREME LASHES, LLC; Joumana Mousselli, Plaintiffs-Appellants, v. XTENDED BEAUTY, INC., Defendant-Appellee.

No. 08-20578.

United States Court of Appeals, Fifth Circuit.

July 15, 2009.

Charles Alfred Sturm (argued), Howard Lynn Steele, Jr., Steele Sturm, PLLC, Houston, TX, for Plaintiffs-Appellants.

Paul Clark Van Slyke (argued), Locke, Lord, Bissell & Liddell, LLP, Houston, TX, for Defendant-Appellee.

Appeal from the United States District Court for the Southern District of Texas.

Before BARKSDALE, DeMOSS and STEWART, Circuit Judges.

DeMOSS, Circuit Judge:

This dispute concerns trademarks for eyelash extensions. We hold that the district court incorrectly granted summary judgment to Defendant-Appellee Xtended Beauty, Inc. ("Xtended") on infringement claims by Plaintiffs-Appellants Xtreme Lashes, LLC and Joumana Mousselli (collectively "Xtreme"). We also hold that the district court incorrectly stripped Xtreme's mark EXTEND YOUR BEAUTY of trademark protection. We reverse and remand for trial.

I.

Xtreme and Xtended sell kits used by professional cosmetologists to lengthen and accent clients' eyelashes. Xtreme has used the marks XTREME LASHES and EXTEND YOUR BEAUTY since September 10, 2005. Xtreme obtained federal registration of EXTEND YOUR BEAUTY on October 23, 2007, and registration of XTREME LASHES on April 1, 2008. XTREME LASHES appears on all or nearly all of Xtreme's products. The mark features a large X, half of which is formed by a stylized eyelash. The type-written mark EXTEND YOUR BEAUTY appears on some products as well, but always in conjunction with XTREME LASHES. Xtreme has spent $1.3 million to promote its products via direct mail campaigns, trade shows, magazines (including American Spa, Beauty Launchpad, and Skin, Inc.), and the Internet. Xtreme sells directly to licensed health and beauty professionals (e.g., cosmetologists, doctors and nurses), as well as to prominent but unlicensed professionals (e.g., make-up artists). Xtreme holds training workshops, for which the participant normally pays between $695 and $900. Only those who complete a workshop and receive Xtreme's certification may buy its products. Xtreme sells a "gold" and a "platinum" kit which cost $529 and $949, respectively. Each kit comes in a silver carrying case which bears the XTREME LASHES mark.

Xtended has used XTENDED BEAUTY on its products since July 29, 2006. The mark features a large, type-written X. Xtended mainly sells to distributors, who then sell to beauty professionals. Xtended markets its products via trade shows, trade publications (including The Green Book and American Beauty), and the Internet. Xtended sells eyelash kits for $345; the kits come in a silver carrying case which features the XTENDED BEAUTY mark. Beauticians must receive training, either from Xtended or another company, before purchasing a kit. Xtended's training is normally free.

Xtreme alleged that Xtended has infringed and diluted its marks.¹ Xtended counterclaimed, seeking cancellation of EXTEND YOUR BEAUTY. Per the district court's order, the parties filed a joint trademark chart. Before the parties conducted discovery, Xtended moved for summary judgment on all claims. In support of its motion, Xtended filed a declaration and report by Dr. Robert Frank, a specialist in trademark searches. After conducting database research, Dr. Frank found that "xtreme" (in its misspelled form) is a common term in the beauty industry. Dr. Frank also found that "extend your beauty" was used by at least thirty companies world-wide to describe or market personal grooming products, including eyelash products and services. In response, Xtreme demonstrated that many of the sellers of eyelash extensions in the United States using the phrase "extend your beauty" were licensees of Xtreme.

After conducting a hearing, the court held that no reasonable person would likely confuse either of Xtreme's marks with XTENDED BEAUTY because the marks were so dissimilar. Without a written statement of reasons, the court entered summary judgment in favor of Xtended on trademark infringement and dilution claims. At a later hearing, the court found EXTEND YOUR BEAUTY descriptive as a matter of law. The court ordered the mark cancelled. The court dismissed other claims as moot and entered final judgment. Xtreme appealed, seeking reversal of the adverse judgments.

II.

We review a district court's grant of summary judgment de novo. Bd. of Supervisors for La. State Univ. Agric. & Mech. College v. Smack Apparel Co., 550 F.3d 465, 474 (5th Cir.2008) (citation omitted). Summary judgment is proper "if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." FED.R.CIV.P. 56(c). "[W]e are obliged to construe all the evidence and reasonable inferences deduced therefrom in a light most favorable to [Xtreme], the nonmoving party in the court below." Int'l Shortstop, Inc. v. Rally's, Inc., 939 F.2d 1257, 1260 (5th Cir.1991).

In a trademark infringement action, the paramount question is whether one mark is likely to cause confusion with another. Marathon Mfg. Co. v. Enerlite Prods. Corp., 767 F.2d 214, 217 (5th Cir. 1985). "Likelihood of confusion" means more than a mere possibility; the plaintiff must demonstrate a probability of confusion. Smack Apparel, 550 F.3d at 478. We examine the following nonexhaustive "digits of confusion" in evaluating likelihood of confusion: (1) the type of trademark; (2) mark similarity; (3) product similarity; (4) outlet and purchaser identity; (5) advertising media identity; (6) defendant's intent; (7) actual confusion; and (8) care exercised by potential purchasers. Id. No digit is dispositive, and the digits may weigh differently from case to case, "depending on the particular facts and circumstances involved." Marathon, 767 F.2d at 218. The court should consider all relevant evidence. Id. at 219. While likelihood of confusion is typically a question of fact, summary judgment is proper if the "record compels the conclusion that the movant is entitled to judgment as a matter of law." Smack Apparel, 550 F.3d at 474. We first consider likelihood of confusion between XTENDED BEAUTY and XTREME LASHES. We then ask whether EXTEND YOUR BEAUTY is a protectable mark, and if so, whether confusion is likely between it and XTENDED BEAUTY.

A. XTREME LASHES

Type of trademark. "Type of trademark" refers to the strength of the senior mark. Elvis Presley Enters., Inc. v. Capece, 141 F.3d 188, 201 (5th Cir.1998). Stronger marks are entitled to greater protection. Amstar Corp. v. Domino's Pizza, Inc., 615 F.2d 252, 259 (5th Cir. 1980). Marks are normally assigned to "categories of generally increasing distinctiveness": (1) generic, (2) descriptive, (3) suggestive, (4) arbitrary, or (5) fanciful. Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768, 112 S.Ct. 2753, 120 L.Ed.2d 615 (1992). "The latter three categories of marks, because their intrinsic nature serves to identify a particular source of a product, are deemed inherently distinctive and are entitled to protection." Id. A generic term refers to the class of which a good is a member. Id. A descriptive term provides an attribute or quality of a good. Id. at 769, 112 S.Ct. 2753. Generic terms receive no trademark protection, while descriptive terms merit protection only if they have secondary meaning. Id. A suggestive term suggests, but does not describe, an attribute of the good; it requires the consumer to exercise his imagination to apply the trademark to the good. Zatarains, Inc. v. Oak Grove Smokehouse, Inc., 698 F.2d 786, 791 (5th Cir.1983). More distinctiveness and less natural or literal content correspond with increased mark strength. See Exxon Corp. v. Tex. Motor Exch. of Houston, Inc., 628 F.2d 500, 504 (5th Cir.1980). It is proper to give more weight to distinctive portions of a mark and less weight to unremarkable or generic portions. See In re Dixie Rests., Inc., 105 F.3d 1405, 1407 (Fed.Cir.1997). "Any given term's correct classification is a factual issue." Soweco, Inc. v. Shell Oil Co., 617 F.2d 1178, 1183 n. 12 (5th Cir. 1980) (citations omitted).

The district court did not determine whether the mark XTREME LASHES is weak or strong. Xtreme does not contend that the mark has secondary meaning; thus, it is protectable only if it is suggestive, fanciful, or arbitrary. Plainly, the mark as a whole is not generic (e.g., "eyelash extensions"), despite the inclusion of the term "lashes." See In re Dixie Rests., 105 F.3d at 1407. Viewing evidence in the light most favorable to Xtreme, we believe that XTREME LASHES "arguably has many of the indicia of a suggestive mark and is therefore entitled to protection." See Sun-Fun Prods., Inc. v. Suntan Research & Dev. Inc., 656 F.2d 186, 191 n. 5 (5th Cir. Unit B Sept.1981). The consumer must exercise some imagination to associate "xtreme lashes" with "artificially elongated eyelashes." See Zatarains, 698 F.2d at 791. The mark uses a misspelling of the word "extreme" and a stylized eyelash forms part of the "X." Cf. Soweco, 617 F.2d at 1186 n. 24 (noting that a misspelling alone does not make an otherwise generic term protectable). Xtended showed that the term "xtreme" appears frequently on cosmetics and grooming products. Cf. Amstar, 615 F.2d at 259-60 (holding that widespread use of DOMINO across many industries weighed against mark strength). However, this prevalence should be weighed by a jury. There is no evidence that other sellers of eyelash products use the term "xtreme." We cannot say with certitude that XTREME LASHES is strong or weak. For summary judgment purposes, the mark is entitled to protection.

Mark similarity. Mark similarity "is determined by comparing the marks' appearance, sound, and meaning." Capece, 141 F.3d at 201. "Similarity of appearance is determined on the basis of...