Corps Grp. v. Afterburner, Inc.

• Decision Date: 04 November 2015
• Docket Number: Nos. A15A1276,A15A1277.,s. A15A1276
• Citation: 779 S.E.2d 383,335 Ga.App. 138
• Parties: The CORPS GROUP et al. v. AFTERBURNER, INC. Lohrenz v. Afterburner, Inc.
• Court: Georgia Court of Appeals

335 Ga.App. 138

779 S.E.2d 383

The CORPS GROUP et al.

v.AFTERBURNER, INC.

Lohrenz

v.Afterburner, Inc.

Nos. A15A1276

A15A1277.

Court of Appeals of Georgia.

Nov. 4, 2015.

Reconsideration Denied Dec. 7, 2015.

Sean Kenneth McMahan, Charles Bertram Eidson, Jordana S. Rubel, J. Kevin Fee, for Appellant.

Stephen Melvin Dorvee, Theresa Ann Yelich Kananen, Atlanta, Ms. Lauren Martha Gregory, for Appellee.

ELLINGTON, Presiding Judge.

Appellants John Borneman, Kyle Howlin, John Underhill, and Carey Lohrenz¹ are former fighter pilots who, after working for the appellee, Afterburner, Inc., a military aviation-themed business consulting firm, formed their own competing military aviation-themed business consulting firm, appellant The Corps Group, and began advising companies on how to apply military battle methodology to business planning and development. Afterburner sued The Corps Group and the individual appellants, alleging, inter alia,² that they had infringed on Afterburner's trademarks and trade dress in violation of the Lanham Act.³ A Forsyth County jury returned a verdict finding that each of the appellants had intentionally infringed on Afterburner's trade dress and four of its trademarks and awarded Afterburner money damages. Thereafter, the trial court entered a final judgment permanently enjoining the appellants from using Afterburner's trade dress and trademarks. In response to Lohrenz's motion for judgment notwithstanding the verdict and extraordinary motion for a new trial, the trial court granted a new trial only as to the apportionment of monetary damages among The Corps Group and the individuals. The appellants contend, inter alia, that the trial court erred in denying their motions for a directed verdict and for judgment notwithstanding the verdict as to Afterburner's Lanham Act claims because the evidence was insufficient to support a finding that they had infringed on Afterburner's trademarks or trade dress.⁴ For the following reasons, we agree and reverse.

"The standard for granting a directed verdict [and] a judgment notwithstanding the verdict are the same." (Citation and punctuation omitted.) South Fulton Medical Center v. Poe, 224 Ga.App. 107, 108(1), 480 S.E.2d 40 (1996).

[O]n appeal from a trial court's rulings on motions for directed verdict and judgment notwithstanding the verdict, we review and resolve the evidence and any doubts or ambiguities in favor of the verdict; directed verdicts and judgments notwithstanding the verdict are not proper unless there is no conflict in the evidence as to any material issue and the evidence introduced, with all reasonable deductions therefrom, demands a certain verdict.

(Footnote omitted.) Vol Repairs II, Inc. v. Knighten, 322 Ga.App. 416, 745 S.E.2d 673 (2013). See also, Moore v. Singh, 326 Ga.App. 805, 809(1), 755 S.E.2d 319 (2014). Viewed in this light, the evidence presented at trial shows as follows.

Afterburner has been offering business consulting services since 1996. Afterburner's founder and CEO, James Murphy, is a former Air Force F–15 fighter pilot. After leaving the military, he decided to continue studying military mission-planning methods and to apply those methods to business development. In addition to applying what he had learned from his own military training and experience, Murphy obtained a license to teach a system called the "Prometheus Process," which was developed by retired Air Force Colonel John Warden, the owner of Venturist, Inc. The Prometheus Process is a military strategic planning model designed to help businesses and organizations define and achieve their goals. Murphy testified that, early on, Afterburner's business consulting model had many elements of the Prometheus Process incorporated within it. Murphy eventually terminated its licensing agreement with Venturist, Inc., and streamlined Afterburner's business consulting model.

Murphy described the Afterburner brand as "unique in the consulting space." It offers motivational keynote speakers, seminars and workshops that feature team-building exercises, corporate coaching, and leadership training. Afterburner focuses less on the long-term strategic planning of the Prometheus Process and more on teaching business people how to execute their goals through a continuous-improvement cycle that Murphy illustrated in a model using the elements: "Plan, brief, execute, debrief, win, lessons learned." Murphy called this model the "Flawless Execution" model, and it became a key component of Afterburner's marketing. Afterburner developed a graphic illustrating its model, a single circle containing a spiral of arrows linking the words "plan, debrief, execute, debrief, win!" and used the graphic as a logo on its marketing materials and as a teaching tool in its presentations. The Flawless Execution model involved teaching business people how to avoid "task saturation"—that is, being overburdened by too many tasks—and how to develop "execution rhythm"—that is, an accountability process involving timely debriefings so that people will learn from their mistakes. Afterburner registered its circular logo and the phrases "Flawless Execution" and "task saturation" with the U.S. Patent and Trademark Office.⁵ It also contended that it had common law trademark⁶ rights in the phrase "execution rhythm."

Afterburner also claimed that it had the exclusive right to use its "trade dress," what Murphy described as a fighter pilot motif that pervaded all aspects of its business consulting services. Murphy testified that Afterburner's use of real pilots wearing standard-issue, sage green flight suits during business consulting presentations constituted the most relevant features of Afterburner's trade dress. Afterburner also decorated its seminars like military bunkers and squadron rooms, often draping conference rooms with parachutes and camouflage netting. It employed loud music, sirens, and theatrical mock enemy attacks. During consulting exercises, Afterburner often engaged clients in military exercises, using maps, check-lists, and other military-style mission-planning paraphernalia. Clients sometimes even wore flight helmets during workshops. Murphy believed that Afterburner had the exclusive right to use fighter pilot and jet plane imagery during its seminars, on its website, and in its brochures and other marketing materials.

John Borneman, the CEO of The Corps Group, testified that when he formed his company in 2008, he knew that it would compete with Afterburner. He testified that he intended to start a Marine Corps aviation-themed business consulting group using a modified "Org–X" version of the Prometheus Process, as well as his own personal experience, in teaching clients how to apply military mission-planning principles to business development. Toward that end, he obtained permission to use the Prometheus Process from Venturist, Inc. Although The Corps Group offered business consulting services that were similar to Afterburner's, like keynote speakers and team-building seminars and work-shops, Borneman testified that its primary focus was on establishing long-term, strategic business planning relationships with clients.

When Borneman was forming The Corps Group, Lohrenz researched their competitors. Lohrenz testified that several individuals and companies offered similar military aviation-themed business consulting services, including Boston Consulting Group, CVM Insights, Mission Excellence, Rob Waldman, Fighter Pilots USA, Mach2, and Check–6. These companies commonly used images of fighter planes, pilots in flight suits, and military jargon (including the plan-execute-debrief model) in their marketing. One of the consulting services had even discussed how the military uses "a concept of flawless execution."

In using the Prometheus Process in its business consulting, The Corps Group's presenters discussed, among other things, the military's plan-execute-debrief model, as well as the concepts of "task overload" and "execution cadence." Borneman testified that, although he and his business associates have discussed with clients the phenomenon of "task saturation"⁷ —military jargon describing the condition of having too much to do in a short period of time or with inadequate resources—The Corps Group never used the phrase as a slogan for a product or a service. Rather, its marketing contained the phrase "task overload." Also, it did not use the phrases "flawless execution" or "execution rhythm." Rather, when marketing or discussing the military plan-execute-debrief model, it used the phrases "Corps execution," "leaders in business execution," and "execution cadence." It illustrated these principles in a diagram depicting three circles in a row, each containing the words "plan, do, debrief" and arrows signifying the cyclical nature of the process. The diagram was used in a "white paper"—a teaching tool—but not in its marketing materials. Borneman testified that these concepts, terms, and processes are part of the Prometheus Process—which is "at the heart of what [The Corps Group does]"—and were not taken from Afterburner. Further, both The Corps Group's "execution cadence" and Afterburner's "execution rhythm" are derived from the term "battle rhythm," a military term used to describe the process of determining the appropriate tactical response to highly changeable battlefield conditions. One of Afterburner's former employees testified that the " mission, brief, plan, execute, after-action review, lessons learned" process is inherently part of military culture, a process he routinely experienced during his Navy aviation career. Part of the process is also sometimes taught as the "OODA Loop," for "observe, orient, decide, act."

Witnesses for The Corps Group also testified that, other than employing fighter pilots as business consultants and using fighter pilot imagery in their marketing materials, The Corps Group's presentation style differed from Afterburner's. They used none of the theatrical stage settings that...