Arrow Fastener Co., Inc. v. Stanley Works

• Decision Date: 18 July 1995
• Docket Number: D,No. 956,956
• Citation: 59 F.3d 384
• Parties: ARROW FASTENER CO., INC., Plaintiff-Appellee, v. The STANLEY WORKS, Defendant-Appellant. ocket 94-9294.
• Court: U.S. Court of Appeals — Second Circuit

Page 384

59 F.3d 384

35 U.S.P.Q.2d 1449

ARROW FASTENER CO., INC., Plaintiff-Appellee, v. The STANLEY WORKS, Defendant-Appellant.

No. 956, Docket 94-9294.

United States Court of Appeals, Second Circuit.

Argued March 10, 1995.

Decided July 18, 1995.

Pasquale A. Razzano, New York City (Stevan J. Bosses; Fitzpatrick, Cella, Harper & Scinto, of counsel), for plaintiff-appellee.

David H.T. Kane, New York City (Siegrun D. Kane, Kathleen E. McCarthy, Kane, Dalsimer, Sullivan, Kurucz, Levy, Eisele, and Richard, of counsel), for defendant-appellant.

Before: MAHONEY, WALKER, and CABRANES, Circuit Judges.

JOSE A. CABRANES, Circuit Judge:

In this case we consider the breadth of protection afforded a registered trademark that also serves as a model number for a hand-operated staple gun. Specifically, we consider whether the trademark is infringed by another company's use of the letter and number that constitute the mark--in combination with other letters and numbers to form a longer model number--on a higher-priced and functionally different stapler. The United States District Court for the District of Connecticut (Peter C. Dorsey, Chief Judge ) held that the plaintiff, Arrow Fastener Co., Inc. ("Arrow"), manufacturer of the hand-operated staple gun, had a valid trademark in "T-50," and that The Stanley Works ("Stanley") infringed upon that trademark by using "T50" as part of a multi-character designation for its pneumatic staplers (staplers powered by an air compressor). 870 F.Supp. 427 (D.Conn.1994). For the reasons set forth below, we find that the scope of Arrow's trademark protection is not so broad as to bar Stanley's use of "T50" with other letters and numbers as a model number on its pneumatic staplers.

I

Unless otherwise indicated, the following facts are not in dispute. Arrow is a manufacturer of staple guns, staplers and other tools. In the early 1950s, it began marketing a hand-operated staple gun identified as T-50. The main market for the Arrow T-50 staple gun is the "do-it-yourself home owner," who uses the device for such tasks as installing, insulating, upholstering, roofing, carpeting, fencing, and wiring. The product retails for approximately $20. The Arrow T-50 stapler has enjoyed extraordinary commercial success and has become the largest seller of its kind in the United States. In 1988, Arrow sought to register the "T-50" identifier as a trademark with the U.S. Patent and Trademark Office ("USPTO"). Although the USPTO initially rejected Arrow's application on grounds that "T-50" merely described an Arrow model, it subsequently granted trademark registration upon receiving evidence that the mark had "become a distinctive indicator of source for the goods." The registration is for "staple gun tackers, in Class 8" of the USPTO's classes of goods and services. Class Eight includes "[h]and tools and instruments; cutlery, forks, and spoons; side arms." See 37 C.F.R. Sec. 6.1(8). Arrow's advertising and packaging for its T-50 stapler, as well as the product itself, feature both the trademark "T-50" and the housemark "Arrow." ¹

Stanley is a manufacturer of tools and hardware products. It acquired the Bostitch division of Textron, Inc., in February 1986 and now sells Bostitch products under the housemarks "Stanley-Bostitch" and "Bostitch." ² In 1989, Stanley introduced a series of six pneumatic staple guns that it called the "T50 series." Powered by an air compressor, pneumatic staplers are used primarily by individuals in the construction trades for such tasks as sheathing, decking, lathing, and roofing. Although the specific natures of these tasks differ, they generally involve attaching board or plywood to the frame, roof, or floor of a building. The tools retail for about $400, but they cannot be operated without air compressors and various other accessories, which cost approximately $425 and $125, respectively.

When initially marketed, each stapler in the series was packaged in a box that bore the primary model number T50, as well as a secondary model number, S2-1, S2-2, S4-1, S4-2, S5-1, or S5-2. The top and front panels of Stanley's boxes for this series of staplers prominently displayed the legend "model T50 series." The six secondary model numbers appeared on a side panel of the box, each accompanied by a square that could be checked off to indicate which particular model was inside the box. The housemark "Bostitch" appeared on all three panels.

After writing letters to Stanley, protesting Stanley's use of the "T50 series" designation, Arrow filed suit in 1991, seeking declaratory and injunctive relief and damages under the Lanham Act, 15 U.S.C. Sec. 1114(1)(a), for infringement of a registered trademark; 15 U.S.C. Sec. 1125, for false designation of origin; the Connecticut Unfair Trade Practices Act, Conn.Gen.Stat. Secs. 42-110a to 42a-110q; and Connecticut trademark infringement common law. In 1993, Stanley, for reasons disputed by the parties, changed the labeling on its stapler packages, so that the T50 series designation, which had originally appeared unattended by other letters and numbers, now appears only as part of a multi-character designation. Specifically, Stanley joined the six secondary model numbers with the primary number. The resulting model numbers are T50S2-1, T50S2-2, T50S4-1, T50S4-2, T50S5-1, and T50S5-2. The tops of the new boxes do not bear a model number at all, and the front and side panels bear one of these six-digit numbers on a small, computer-generated strip.

After a bench trial, the district court concluded that Stanley's use of T50 as a series identifier infringed on Arrow's rights in the T-50 mark, and the court granted injunctive relief. The November 14, 1994, judgment provided, in pertinent part, that Stanley was:

enjoined from manufacturing, advertising, promoting, selling or offering for sale any product bearing the mark T50 or T-50 and from using in commerce any reproduction, counterfeit, copy, or colorable imitation of the registered trademark T-50 in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive, including by using the mark T50, or any mark comparable or similar to the T-50 trademark, in any manner related to any stapling, tacking or fastening product....

Stanley appealed, seeking reversal and vacatur of the injunction. In the alternative, Stanley sought a modification of the injunction to clarify that it applied only to the use of T50 alone. Stanley argued that the injunction should not apply to the use of T50 as part of a complete model number or to Stanley's use of other number/letter combinations, such as T55 for a certain model of its pneumatic tackers or BT50 for its pneumatic brad tackers.

At oral argument on March 10, 1995, Stanley stated on the record that it was no longer using T50 alone on its packaging, but only in combination with other numbers and letters to form part of longer model numbers. Arrow Fastener Co. v. Stanley Works, 870 F.Supp. 427 (D.Conn.1994) (Appendix at 1, 2), remanded without published opinion, 52 F.3d 311 (2d Cir.1995). It argued that whether the injunction reached this current practice was unclear. Arrow maintained that the injunction did and should reach Stanley's current practice. We agreed with Stanley that the scope of the injunction was unclear, and we remanded the case to the district court to determine in the first instance whether Stanley's current use of the model numbers violated the injunction. Id. On remand, the district court stated that its injunction did reach uses such as T50S2-1, T50S2-2, T50S4-1, T50S4-2, T50S5-1, T50S5-2, as well as BT50-1, BT50-2, and BT50-3, because the record supported a finding that those uses "would suggest a product associated with the T-50 mark." Response to Mandate, at 1 (filed April 28, 1995, doc. # 130). The district court stated that its injunction would not reach the use of T55S4-1, T55S4-2, T55S5-1, and T55S5-2, because T55 "was not found to be a protected mark." Id.

Because Stanley is no longer using T50 alone, and because it represented at oral argument that it will not use T50 standing alone on its packaging, we consider on this appeal only whether Stanley infringes upon Arrow's rights when it uses the alpha-numerical designations described in the preceding paragraph that the district court found to be within the scope of its injunction. ³ For the reasons stated below, we find that the district court erred in concluding that these uses violated Arrow's rights.

II

A.

We begin with a review of the governing legal standards. To establish a trademark infringement claim under the Lanham Act, a plaintiff must show that the defendant used in commerce, without the plaintiff's consent, a "reproduction, counterfeit, copy, or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion...." 15 U.S.C. Sec. 1114(1)(a). ⁴ To prevail under this statute, the plaintiff must show that "it has a valid mark entitled to protection and that the defendant's use of it is likely to cause confusion." Gruner + Jahr USA Publishing v. Meredith Corp., 991 F.2d 1072, 1075 (2d Cir.1993). Whether the mark is entitled to protection depends on whether it is inherently distinctive or, if merely descriptive, has acquired "secondary meaning." See Merriam-Webster, Inc. v. Random House, Inc., 35 F.3d 65, 70 (2d Cir.1994), cert. denied, --- U.S. ----, 115 S.Ct. 1252, 131 L.Ed.2d 133 (1995). Secondary meaning attaches when " 'the name and the business have become synonymous in the mind of the public, submerging the primary meaning of the term in favor of its meaning as a word identifying that business.' " Pirone v. MacMillan, Inc., 894 F.2d 579, 583 (2d Cir.1990) (quoting Abraham Zion Corp. v....