Anheuser-Busch, Inc. v. L. & L. Wings, Inc.

• Decision Date: 10 April 1992
• Docket Number: P,INCORPORATE,91-3043,Nos. 91-3039,ANHEUSER-BUSC,s. 91-3039
• Citation: 962 F.2d 316
• Parties: , 22 U.S.P.Q.2d 1502 laintiff-Appellee, v. L & L WINGS, INCORPORATED, Defendant-Appellant, and Venture Marketing, Incorporated; Sunburst Screen Printing, Defendants.laintiff-Appellee, v. VENTURE MARKETING, INCORPORATED, Defendant-Appellant, and L & L Wings, Incorporated; Sunburst Screen Printing, Defendants.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 316

962 F.2d 316

22 Fed.R.Serv.3d 575, 22 U.S.P.Q.2d 1502

ANHEUSER-BUSCH, INCORPORATED, Plaintiff-Appellee, v. L & L WINGS, INCORPORATED, Defendant-Appellant, and Venture Marketing, Incorporated; Sunburst Screen Printing,

Defendants.

ANHEUSER-BUSCH, INCORPORATED, Plaintiff-Appellee, v. VENTURE MARKETING, INCORPORATED, Defendant-Appellant, and L & L Wings, Incorporated; Sunburst Screen Printing, Defendants.

Nos. 91-3039, 91-3043.

United States Court of Appeals,

Fourth Circuit.

Argued Dec. 2, 1991.

Decided April 10, 1992.

Cort Flint, Jr., Cort Flint, P.A., Greenville, S.C., argued, for defendants-appellants; Peter D. Hyman, The Hyman Law Firm, Florence, S.C., for defendant-appellant L & L Wings; Robert J. Reeves, Collins & Lacy, Columbia, S.C., for defendant-appellant Venture Marketing, on brief.

Floyd A. Gibson, Bell, Seltzer, Park & Gibson, Charlotte, N.C., argued, for plaintiff-appellee; John H. Thomas, William M. Atkinson, Charlotte, N.C., John E. Cuttino, Turner, Padget, Graham & Laney, Columbia, S.C., Richard W. Renner, Anheuser-Busch, Inc., St. Louis, Mo., on brief.

Before POWELL, Associate Justice (Retired), United States Supreme Court, sitting by designation, and WILKINSON and LUTTIG, Circuit Judges.

OPINION

WILKINSON, Circuit Judge:

In this case, plaintiff Anheuser-Busch sued defendants for selling souvenir T-shirts that plaintiff claimed infringed its Budweiser beer trademarks. The jury returned a verdict in favor of defendants, finding that defendants' T-shirt design did not create a likelihood of consumer confusion, but the district judge granted plaintiff's motion for judgment notwithstanding the verdict. We reverse. The record reveals sufficient differences between the T-shirt design and plaintiff's trademarks to permit the jury to conclude that consumer confusion was unlikely. Accordingly, we think the district judge improperly substituted his judgment as to likelihood of confusion for that of the jury, and we remand with instructions to reinstate the jury verdict in favor of defendants.

I.

In 1987, Michael Berard was a student at the University of North Carolina at Chapel Hill. In order to supplement his income, Berard decided to go into the business of designing and selling T-shirts. During 1987, Berard devised a T-shirt design that he planned to sell as a souvenir of Myrtle Beach. That design depicted a beer can with a red, white and blue label. The words on the can did not refer to beer, however, but only to Myrtle Beach.

In 1988, Berard incorporated Venture Marketing, Inc., (Venture) in order to manufacture and wholesale his T-shirts. Venture marketed the Myrtle Beach T-shirts through L & L Wings, Inc., (Wings) which operates a number of retail beach stores at Myrtle Beach, South Carolina and at other beaches. Wings purchased over 20,000 shirts from Venture. ¹

In 1989 Anheuser-Busch, Inc., brought this trademark infringement action against Venture and Wings. Anheuser-Busch alleged that the T-shirt design was confusingly similar to the Budweiser beer label, a registered trademark which Anheuser-Busch had used on its own line of T-shirts and other apparel. Anheuser-Busch complained that the Myrtle Beach T-shirt infringed its trademarks because consumers were likely to believe the T-shirt was sold or sponsored by Anheuser-Busch. The case was tried before a jury for three days, and the jury returned a verdict in favor of the defendants. Anheuser-Busch filed a motion for j.n.o.v. or, in the alternative, for a new trial. After briefing and argument, the district judge granted the j.n.o.v. motion, holding that the evidence before the jury permitted only one reasonable conclusion: that the T-shirt created a likelihood of confusion and thus infringed Anheuser-Busch's trademarks. Accordingly, the district court entered judgment on the question of liability in favor of Anheuser-Busch, and took the motion for a new trial under advisement pending appeal. Venture and Wings then brought this appeal.

II.

Under the Lanham Act, a registered trademark holder has a right to prevent another's use of a trademark that is "likely to cause confusion, or to cause mistake, or to deceive." 15 U.S.C. § 1114(1)(a). See Shell Oil Co. v. Commercial Petroleum, Inc., 928 F.2d 104, 108 (4th Cir.1991). In other words, an unauthorized use of a trademark infringes the trademark holder's rights if it is likely to confuse an "ordinary consumer" as to the source or sponsorship of the goods. Ford Motor Co. v. Summit Motor Products, Inc., 930 F.2d 277, 293 (3d Cir.1991); 2 J. McCarthy, Trademarks and Unfair Competition § 23:28 (1984). This pivotal trademark issue is particularly amenable to resolution by a jury for two reasons. First, the jury, which represents a cross-section of consumers, is well-suited to evaluating whether an "ordinary consumer" would likely be confused. Second, the likelihood of consumer confusion is an "inherently factual" issue that depends on the unique facts and circumstances of each case. Levi Strauss & Co. v. Blue Bell, Inc., 778 F.2d 1352, 1356 n. 5 (9th Cir.1985). Likelihood of confusion is "frequently a fairly disputed issue of fact on which reasonable minds may differ," Warner Bros., Inc. v. American Broadcasting Cos., 720 F.2d 231, 246 (2d Cir.1983), and has long been recognized to be "a matter of varying human reactions to situations incapable of exact appraisement." Colburn v. Puritan Mills, Inc., 108 F.2d 377, 378 (7th Cir.1939).

A district judge may overturn a jury verdict on a motion for j.n.o.v. only if "there is no legally sufficient evidentiary basis for a reasonable jury to have found for [the prevailing] party." Fed.R.Civ.P. 50(a)(1). In making this determination, the judge is not to weigh the evidence or appraise the credibility of witnesses, but must view the evidence in the light most favorable to the non-moving party and draw legitimate inferences in its favor. Mays v. Pioneer Lumber Corp., 502 F.2d 106, 107 (4th Cir.1974). Our review of the district court's action is de novo. Here we believe the district judge improperly assumed the jury's role of determining whether an ordinary consumer would likely be confused by the T-shirt, and we reverse the court's entry of j.n.o.v.

The jury was entitled to conclude that consumer confusion was unlikely based on a number of conspicuous differences between the T-shirt design and the Budweiser label. First, the T-shirt design makes no reference of any sort to Anheuser-Busch or Budweiser. By contrast, the Budweiser label displays a number of prominent indications of the product's source or sponsor: the name "Budweiser" flanked on either side by the word "genuine"; the geographic designation "Anheuser-Busch, Inc., St. Louis, Mo."; the letters "AB" for Anheuser-Busch; and the Anheuser-Busch trademark depicting an eagle in the middle of the letter "A." With respect to all of these, the T-shirt design either omits them entirely or replaces them with references to the beach. The T-shirt design replaces the Budweiser name with the words "Myrtle Beach"; substitutes the words "Myrtle Beach, S.C." for "Anheuser-Busch, Inc., St. Louis, Mo."; and replaces the letters "AB" with "SC." In addition, the T-shirt eliminates the Anheuser-Busch trademark "A" and omits the word "genuine."

Second, the T-shirt replaces the Budweiser label's descriptions of the beer with analogous language descriptive of the beach. The Budweiser label reads as follows:

This is the famous Budweiser beer. We know of no brand produced by any other brewer which costs so much to brew and age. Our exclusive Beechwood Aging produces a taste, a smoothness, and a drinkability you will find in no other beer at any price.

On the Venture Marketing T-shirt design, these sentences are replaced with a description of the beach:

This is the famous beach of Myrtle Beach, S.C. We know of no other resort in any state which lays claim to such a rich history. The unspoiled beaches, natural beauty, and southern hospitality compose a mixture you will find on no other beach in any state.

Similarly, the descriptive words at the bottom of the Budweiser label--announcing that the beer is "Brewed by our original process from the Choicest Hops, Rice and Best Barley Malt"--are replaced in the T-shirt design with words proclaiming that "Myrtle Beach contains the Choicest Surf, Sun, and Sand."

Third, the T-shirt design incorporates its own beach slogans in place of the Budweiser beer slogans. The Budweiser label includes the slogan "King of Beers" under the Budweiser name. On the T-shirt, this is replaced with the words "King of Beaches." In addition, the T-shirt mimics another Budweiser slogan, "This Bud's for You," with its own slogan, "This Beach is for You."

Together, we think these differences are sufficient at least to create a reasonable jury question on the issue of likelihood of confusion. The jury had the opportunity to visually examine the T-shirt and to compare it with the Anheuser-Busch trademarks. We cannot say that the jury's conclusion was the only one it could have reached, but neither are we able to say that its verdict was unreasonable. In this regard, our dissenting brother faithfully presents Anheuser-Busch's side of the jury argument. To believe that the jury should have heard this argument is not to say that the jury was required to accept it.

III.

Anheuser-Busch suggests two reasons why we should disregard the jury verdict in this case. First, it contends that a judgment in its favor was compelled because the T-shirt incorporated a beer label design that intentionally imitated the non-verbal portion of the Budweiser label. At trial, Michael Berard admitted that he had patterned the T-shirt's beer label after the basic Budweiser format, and it is undisputed that he was successful in that endeavor. In Anheuser-Busch's view, this similarity of format by itself infringes its registered trademark in the Budweiser beer label design.

We disagree. Anheuser-Busch would have ...