Boston Athletic Ass'n v. Sullivan

• Decision Date: 16 September 1988
• Docket Number: No. 88-1352,88-1352
• Parties: , 9 U.S.P.Q.2d 1690 BOSTON ATHLETIC ASSOCIATION, et al., Plaintiffs, Appellants, v. Mark SULLIVAN, etc., et al., Defendants, Appellees. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 22

867 F.2d 22

57 USLW 2508, 9 U.S.P.Q.2d 1690

BOSTON ATHLETIC ASSOCIATION, et al., Plaintiffs, Appellants, v. Mark SULLIVAN, etc., et al., Defendants, Appellees.

No. 88-1352.

United States Court of Appeals First Circuit.

Heard Sept. 16, 1988.

Decided Jan. 27, 1989.

As Amended Jan. 31, 1989.

George C. Caner, Jr., with whom John W. Van Lonkhuyzen and Ropes & Gray, Boston, Mass., were on brief, for plaintiffs, appellants.

Stephen M. Trattner, Washington, D.C., Philip W. Tone, Jenner & Block, Lee N. Abrams, and Mayer, Brown & Platt, Chicago, Ill., on brief for U.S. Golf Ass'n, amicus curiae.

Glenn M. Shriberg, Boston, Mass., with whom Dana Ryan Turnbull, Arlington, Mass., and Shriberg & Sorbello, Boston, Mass., were on brief, for defendants, appellees.

Before CAMPBELL, Chief Judge, BOWNES and SELYA, Circuit Judges.

BOWNES, Circuit Judge.

In this service mark infringement case, ¹ Boston Athletic Association (BAA) and Image Impact, Inc. (Image) appeal the denial of their motion for summary judgment and the concurrent granting of the defendants', Mark Sullivan d/b/a Good Life (Sullivan) and Beau Tease, Inc. (Beau Tease), motion for summary judgment. This case arises out of the sale by the defendants of T-shirts (hereinafter called shirts) and other wearing apparel with designs alleged to infringe on BAA's service marks "Boston Marathon," "BAA Marathon" and its unicorn logo. We agree with the district court that there are no genuine issues of material fact, but disagree with the district court's determination of which side was entitled to summary judgment. We, therefore, reverse.

I. THE STARTING LINE

The standard for granting summary judgment in a trademark infringement case is as follows:

Summary judgment is proper only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Astra [Pharmaceutical Products, Inc. v. Beckman Instruments, Inc.], 718 F.2d [1201] at 1204 (1st Cir.1983); Pignons [S.A. de Mecanique de Precision v. Polaroid Corp.], 657 F.2d at 486 (1st Cir.1981); Fed.R.Civ.P. 56(c). A factual dispute is material if it "affects the outcome of the litigation," and genuine if manifested by "substantial" evidence "going beyond the allegations of the complaint." Astra, 718 F.2d at 1204 and Pignons, 657 F.2d at 486; quoting Hahn v. Sargent, 523 F.2d 461, 464 (1st Cir.1975), cert. denied, 425 U.S. 904, 96 S.Ct. 1495, 47 L.Ed.2d 754 (1976).

Volkswagenwerk Aktiengesellschaft v. Wheeler, 814 F.2d 812, 815 (1st Cir.1987); see also Astra Pharmaceutical Products, Inc. v. Beckman Instruments, Inc., 718 F.2d 1201, 1204 (1st Cir.1983); Pignons S.A. de Mecanique de Precision v. Polaroid Corp., 657 F.2d 482, 486 (1st Cir.1981). "While infringement and unfair competition cases often present factual issues that render summary judgment inappropriate, this is not invariably so." Kazmaier v. Wooten, 761 F.2d 46, 48-49 (1st Cir.1985) (citations omitted). "In passing on a summary judgment motion, the court must view the record and draw inferences in the light most favorable to the opposing party." Id. (citations omitted). Because we believe summary judgment should have been entered for plaintiffs, we review the facts in the light most favorable to defendants.

Before we turn to the facts, however, we must deal with a preliminary matter. As discussed infra at 26, prior to the parties submitting cross-motions for summary judgment, the district court conducted an aborted trial at which the plaintiffs presented the majority of their case. The use of the trial record was urged by the parties in their cross-motions: the plaintiffs referred to the exhibits, while the defendants referred to both the testimony and the exhibits. Although the district judge did not explicitly address the point in his memorandum of decision, he did state that he had "[r]eview[ed] the entire file" in reaching his decision on the cross-motions for summary judgment. We assume that this review included the testimony and exhibits received in the aborted trial. Reference to prior trial testimony and exhibits is proper in summary judgment cases. Advance Financial Corp. v. Isla Rica Sales, Inc., 747 F.2d 21, 27 (1st Cir.1984). We have treated the trial record as part of the record before us.

II. THE START IN STATE COURT

We have taken the facts mainly from the district court opinions. BAA is a charitable organization whose principal activity has been conducting the Boston Marathon since it was first run in 1897. The race is run annually from Hopkinton to Boston on Patriots' Day, the third Monday in April. In recent years, a day or two prior to the race an exposition has been put on by Conventures, Inc. under BAA's sponsorship. At the exposition, various businesses set up booths and sell shirts, running apparel, and sports items. The registered runners also pick up their numbers and official materials from the BAA booth.

Defendant Sullivan, a resident of Hopkinton, Massachusetts, retails wearing apparel under the name "Good Life" at a store in Hopkinton. Defendant Beau Tease, Inc. is a Massachusetts corporation doing business in Cambridge. It imprints and distributes merchandise, including shirts, to the trade.

In an effort to defray the costs of the race, BAA began an active campaign to market its name via licensing agreements. It registered the names "Boston Marathon" and "BAA Marathon" and its unicorn logo in Massachusetts in 1983 and "Boston Marathon" in the United States Patent and Trademark Office in 1985.

As early as 1978, the defendants were imprinting and selling shirts with the name "Boston Marathon" and various other terms including the year on them. In 1984, defendant Sullivan negotiated an agreement under which Beau Tease sold to BAA a large quantity of shirts which BAA gave away to the athletes and volunteers during the 1985 race. In 1986, Image, through its President, Mickey Lawrence, entered into an exclusive license with BAA for the use of BAA's service marks on wearing apparel including shirts. Starting in 1986, Image and BAA gave notice to imprinters, wholesalers, and retailers that Image was the exclusive licensee of the BAA and that any unauthorized use on merchandise of the name "Boston Marathon," or a similar name or a colorable imitation thereof, would violate the exclusive rights of BAA and its licensee.

By March of 1986, Beau Tease was imprinting and Sullivan was selling in the Boston area shirts imprinted as follows:

1986 Marathon

[picture of runners]

Hopkinton-Boston

BAA brought suit in Massachusetts Superior Court against the current defendants, and others, alleging that the above design infringed upon its marks. The superior court denied its request for a preliminary injunction, Boston Athletic Association v. Graphtex, Inc., Suffolk Superior Court No. 82365, slip op. (April 11, 1986); the denial was affirmed by a single justice of the Massachusetts Court of Appeals, No. A.C.-86-0169-CV (April 18, 1986) (Fine, J.). The action was discontinued without prejudice; the parties reserved their right to assert their positions in any future action.

In late 1986 and early 1987, Beau Tease began to imprint and Sullivan began to retail shirts and other apparel imprinted as follows:

1987 Marathon

[picture of runners]

Hopkinton-Boston

The 1987 shirts and the 1986 shirts were of poorer quality than plaintiffs' both as to manufacture and materials. The defendants were planning to sell their shirts and other items at the exposition.

III. THE CONTESTANTS REACH FEDERAL COURT

In 1987, the exposition was held on Saturday April 18 and the race on Monday April 20. On April 1, 1987, BAA and Image filed suit in the United States District Court for the District of Massachusetts alleging that defendants' 1986 and 1987 shirts, with the logos described above, infringed BAA's marks. The complaint alleged confusion in violation of the Lanham Act, 15 U.S.C. Sec. 1114, and a similar provision in Massachusetts law, Mass.Gen.Laws Ann. ch. 110B, Sec. 11. The complaint also included additional state law counts for dilution, Mass.Gen.Laws Ann. ch. 110B, Sec. 12, sale of counterfeits and imitations, Mass.Gen.Laws Ann. ch. 110B, Sec. 13, and unauthorized use of a name, Mass.Gen.Laws Ann. ch. 214, Sec. 3A. Along with the complaint, plaintiffs filed a motion for a preliminary injunction, seeking to stop the manufacture and sale of any article bearing the name "Boston Marathon" or any similar name.

On April 8, 1987, the district court held a hearing at which it consolidated the preliminary injunction hearing with a trial on the merits; the defendants were deemed to have made a general denial. Prior to the trial, the parties agreed to certain facts including BAA's registration of its marks in 1983 and 1985. Also prior to trial, several affidavits were filed with the court.

Three days of trial were held on April 13, 14, and 15. During the trial, the plaintiffs presented most of their case. Lawrence, president of plaintiff Image, testified to instances in which people bought defendants' shirts at the 1986 exposition thinking they were plaintiffs'. This testimony was admitted over objection. On April 16, because the exposition was only two days away and the parties were concerned about whether the defendants could sell their shirts at the exposition, the district court received offers of proof as to the remaining witnesses and heard oral argument on the motion for a preliminary injunction.

In a bench opinion the court found that plaintiffs would probably succeed in showing that: 1. BAA's mark was valid and effective at all relevant times; 2. the name "Boston Marathon" when used on products would cause the average person to infer sponsorship by somebody, even if the average person did not realize that BAA was the sponsor; 3. defendants' designs...