985 F.Supp. 372 (S.D.N.Y. 1997), 97 Civ. 5031, Otokoyama Co. Ltd. v. Wine of Japan Import, Inc.

Docket Nº:97 Civ. 5031.
Citation:985 F.Supp. 372
Party Name:45 U.S.P.Q.2d 1194 OTOKOYAMA CO. LTD., a Japanese Corporation, Plaintiff, v. WINE OF JAPAN IMPORT, INC., a New York Corporation, and Does 1 through 50, inclusive, Defendants.
Case Date:November 14, 1997
Court:United States District Courts, 2nd Circuit, Southern District of New York

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985 F.Supp. 372 (S.D.N.Y. 1997)

45 U.S.P.Q.2d 1194

OTOKOYAMA CO. LTD., a Japanese Corporation, Plaintiff,


WINE OF JAPAN IMPORT, INC., a New York Corporation, and Does 1 through 50, inclusive, Defendants.

No. 97 Civ. 5031.

United States District Court, S.D. New York.

Nov. 14, 1997

As Amended Nov. 20, 1997.

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Nancy J. Deckinger, Arlana S. Cohen, Mark J. Speciner, Liddy, Sullivan, Galway, Begler & Cohen, P.C., New York, NY, for plaintiff.

Michael A. Cornman, Meyer Gross, Schweitzer, Cornman, Gross & Bondell, New York, NY, for defendants.


BAER, District Judge.

Plaintiff Otokoyama Co. Ltd. ("OCL"), a Japanese corporation, moves for a preliminary injunction preventing defendant Wine of Japan Import, Inc. ("WOJI"), a New York corporation, from infringing on plaintiff's trademark "Otokoyama" through the unauthorized use of that trademark in connection with the sale, advertisement, production and/or distribution of sake in the United

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States. For the reasons stated below, the plaintiff's motion is granted.

I. Background

Since 1984, OCL has distributed and sold sake (a mildly alcoholic Japanese beverage made from fermented rice) using the trademarks "Otokoyama" and the Japanese character notations denoting the term "Otokoyama", for which it owns the federal trademark registrations. 1 During the past 13 years, OCL has been the sole user of the Otokoyama trademarks in connection with the sale and distribution of sake in the U.S. In late March 1997, OCL became aware that WOJI began advertising, distributing and offering for sale sake under the name "Mutsu Otokoyama." On April 2, 1997, OCL's attorneys and attorney's for OCL's exclusive dealer wrote to WOJI to demand that it cease and desist the importation, distribution, advertisement and sale of the Mutsu Otokoyama sake. WOJI responded that it believed plaintiff's trademarks were invalid, and continued to offer its sake for sale. OCL subsequently brought this action for trademark infringement, unfair competition, and false designation of origin, arising under the Lanham Act, 15 U.S.C. § 1051 et seq., as well as state law claims. OCL now moves for a preliminary injunction, preventing defendant from infringing on its Otokoyama trademark. An evidentiary hearing was held on October 20, 1997.

II. Discussion

In order to prevail on its preliminary injunction motion, plaintiff must establish (1) "either a likelihood of success on the merits or sufficiently serious questions going to the merits ... and a balance of hardships tipping decidedly in the moving party's favor" and (2) that it will suffer irreparable injury. Clinique Laboratories, Inc. v. Dep Corp., 945 F.Supp. 547, 550 (S.D.N.Y.1996). In a trademark action, in order to satisfy the first prong, a likelihood of success on the merits or sufficiently serious questions going to the merits, the movant must first establish that it has a valid mark. See Estee Lauder Inc. v. The Gap, Inc., 108 F.3d 1503 (2d Cir.1997). Once the validity of the mark is established irreparable harm and the likelihood of success on the merits may be established by showing a likelihood of significant consumer confusion or misunderstanding as to the source or sponsorship of the product in question. Giorgio Beverly Hills v. Revlon Consumer Products Corp., 869 F.Supp. 176, 180 (S.D.N.Y.1994).

A. Valid Mark

The first issue therefore is whether plaintiff has a valid mark. Defendant contends that plaintiff has no valid mark and that its trademark registrations, obtained under improper circumstances, should be canceled. Specifically, defendant alleges that when plaintiff applied for its trademark registration, the U.S. Patent & Trademark Office ("PTO") asked for an English translation of the foreign word "otokoyama." In response, plaintiff informed the Examiner that the mark was fanciful or arbitrary and could not be translated. Defendant argues that plaintiff knew the term could be translated and misrepresented that it could not in order to secure the trademark registration in the U.S. The word "otokoyama" is a contrived term comprised of two Japanese words, "otoko" and "yama." While they can be literally translated to mean "man" and "mountain," respectively, that revelation hardly supports defendant's view that the plaintiff's statement was patently false. There is no evidence that OCL intended to mislead the trademark Examiner when it stated that the mark itself could not be translated.

WOJI also argues that OCL knew at the time it submitted its trademark application that the word "otokoyama" is a descriptive or generic term in Japan for a particular ancient type of dry, manly sake, but failed to disclose this to the trademark Examiner. It contends that this knowledge is evidenced by OCL's advertising brochure, (Plaintiff's Exh. L), which states "Otokoyama, a variety of high-quality sakes, ..." and refers to otokoyama as a "high-quality sake backed by 340 years of tradition." As further evidence of

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this knowledge, WOJI points to the Japanese Trademark Office's denial of OCL's trademark in Japan, which stated that the term "otokoyama" is "a customary written statement of the goods."

OCL's brochure, however, does not demonstrate that the term "otokoyama" refers to a particular variety of sake; OCL's brochure simply refers to the many types of sake OCL offers for sale under the Otokoyama trademarks. The brochure itself advertises four different types of sake offered for sale by OCL under the Otokoyama trademarks in the United States. 2 More importantly, even assuming that "otokoyama" is in the public domain and means simply, as defendant contends, a variety of dry, manly sake in Japan, this fact is irrelevant to the U.S. PTO's determination of OCL's trademark rights. See Seiko Sporting Goods U.S.A., Inc. v. Tokeiten, 545 F.Supp. 221, 226 (S.D.N.Y.1982), aff'd, 697 F.2d 296 (2d Cir.1982). Therefore, plaintiff had no duty to disclose this information to the PTO. The decision of the Japanese Trademark Office is irrelevant and inadmissible in this action. Vanity Fair Mills, Inc. v. T. Eaton Co. Ltd., 234 F.2d 633, 639 (2d Cir.1956), cert. denied, 352 U.S. 871, 77 S.Ct. 96, 1 L.Ed.2d 76 (1956); see also, Noone v. Banner Talent Assocs. Inc., 398 F.Supp. 260, 263 (S.D.N.Y.1975). Accordingly, defendant has failed to establish a likelihood of success on the merits as to its claim that OCL's trademark should be canceled. 3

B. Likelihood of Confusion

Since the defendant has failed to show that plaintiff does not have a valid mark, the next issue is whether the defendant's actions are likely to cause significant consumer confusion. The "likelihood of confusion" issue is...

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