Madison Reprographics, Inc. v. Cook's Reprographics, Inc.

• Decision Date: 09 May 1996
• Docket Number: No. 95-2596,95-2596
• Citation: 203 Wis.2d 226,552 N.W.2d 440
• Parties: , 41 U.S.P.Q.2d 1905 MADISON REPROGRAPHICS, INC., d/b/a Madison Repro, a Wisconsin Corporation, Plaintiff-Appellant, v. COOK'S REPROGRAPHICS, INC., Formerly Repro Plus, Inc., a Wisconsin Corporation, Michael S. Cook and Darlene A. Cook, Defendants-Respondents. . Oral Argument
• Court: Wisconsin Court of Appeals

Page 440

552 N.W.2d 440

203 Wis.2d 226, 41 U.S.P.Q.2d 1905

MADISON REPROGRAPHICS, INC., d/b/a Madison Repro, a Wisconsin Corporation, Plaintiff-Appellant, v. COOK'S REPROGRAPHICS, INC., Formerly Repro Plus, Inc., a Wisconsin Corporation, Michael S. Cook and Darlene A. Cook, Defendants-Respondents.

No. 95-2596.

Court of Appeals of Wisconsin.

Oral Argument May 9, 1996.

Opinion Released June 27, 1996.

Opinion Filed June 27, 1996.

For the plaintiff-appellant the cause was submitted on the briefs of J. Thomas Haley and Kevin J. Palmersheim of Haley Palmersheim, S.C. of Middleton. There was oral argument by Kevin J. Palmersheim.

For the defendants-respondents the cause was submitted on the brief of Richard A. Westley and David J. Regele of Westley Law Offices, S.C. of Madison. There was oral argument by David J. Regele.

Before GARTZKE, P.J., and SUNDBY and VERGERONT, JJ.

VERGERONT, Judge.

Madison Reprographics, Inc. appeals from a judgment dismissing its claims against Cook's Reprographics, Inc. (formerly known as Repro Plus, Inc.) for common law trade name infringement and infringement of a mark registered under § 132.01, STATS. After a trial to the court, the court dismissed the common law claim because it determined that there was insufficient likelihood of confusion between "Madison Repro" and "Repro Plus." We affirm the dismissal of this claim. The trial court also dismissed the statutory claim. We affirm the dismissal of the statutory claim, concluding that Cook's Reprographics' logo does not meet the statutory definition of a "counterfeit mark" under § 132.001(1), STATS.

FACTUAL BACKGROUND

Madison Reprographics was incorporated in January 1977 under the name QDS, Inc. In 1982, it changed its name to Madison Reprographics, Inc. Madison Reprographics' primary business is providing the services of photographic reproduction, document reduction and enlargement, blue-line printing, large document copying, and general document reproduction. It provides these services to architects, engineers, graphic artists, designers, law firms, accounting firms, insurance companies and publishers. It also sells some drafting supplies and printing materials. Its business locations have been on the west side of Madison, Wisconsin, and in Middleton, Wisconsin, and most of its business is within Dane County.

Madison Reprographics started to use the name "Madison Repro" in connection with advertising and the promotion of its business in 1982 or 1983. In October 1983, Madison Reprographics registered the mark "Madison Repro" in a design format with the Wisconsin Secretary of State. The registered mark consists of a solid red rectangle surrounding the word "repro" in lower-case, bold, sans serif white letters; above the red rectangle is the word "MADISON" in upper-case, plain, sans serif red letters. The application described the business as "Reprographic Service and Sale of Printing Products: Example--Blue-Line Printing Paper."

Cook's Reprographics incorporated under the name of "Repro Plus, Inc." in July 1992, and began doing business on the west side of Madison. Seventy percent of its business consists of offering the services of plain paper copying, diazo printing, specification copying, color copying, dry mounting and laminating. The remainder of its business consists of selling drafting and plotting equipment and graphic arts equipment. Cook's Reprographics' main client base consists of architects, engineers and contractors; other clients are advertising agencies, law firms, graphic artists and interior designers. Most of its business is within Dane County. Soon after it began operating, Cook's Reprographics began advertising and promoting its business using the name "Repro Plus" and a logo containing the words "Repro Plus Inc." The logo consists of the black outline of a scroll on a white background. On the scroll, "Repro" is written in red, serif, italicized letters above "Plus Inc." in white, serif, italicized letters outlined in black. ¹

COMMON LAW TRADE NAME INFRINGEMENT

Madison Reprographics argues that the trial court erred in determining that there was insufficient likelihood of confusion between the names "Madison Repro" and "Repro Plus" because there are facts showing actual confusion. Cook's Reprographics responds that the trial court's determination was correct, and alternatively argues that "Madison Repro" is a generic term and therefore entitled to no protection at common law regardless of any likelihood of confusion. We conclude that the evidence supports both the trial court's implicit finding that "Madison Repro" is descriptive and its finding that there was insufficient likelihood of confusion.

Background on Common Law Infringement

Wisconsin recognizes a cause of action at common law for infringement of a trademark or trade name. First Wisconsin Nat'l Bank v. Wichman, 85 Wis.2d 54, 63, 270 N.W.2d 168, 172-73 (1978). ² In order to prevail on this claim, the plaintiff must show that a designation meets the definition of trademark or trade name and that the defendant's use of a similar designation is likely to Madison Reprographics asserts that "Madison Repro" is entitled to protection as a trade name. A trade name is a word or other designation, or a combination of such designations, that is used in a manner that identifies that business or enterprise and distinguishes it from the business or enterprise of others. RESTATEMENT § 12. ³ Just as with trademarks, a designation is protectable as a trade name only if the designation is distinctive. RESTATEMENT § 13 cmt. a. Designations can be either inherently distinctive or can acquire distinctiveness through use in connection with the business. RESTATEMENT § 13(a) and (b). Inherently distinctive designations are designations that are likely to be perceived by prospective purchasers as symbols of identification that indicate an association with a particular source. RESTATEMENT § 13 cmt. b. ⁴

cause confusion. Id. at 64-66, 270 N.W.2d at 173-74; RESTATEMENT (THIRD) OF UNFAIR COMPETITION § 20 (1995) [hereinafter RESTATEMENT].

Designations that merely describe the nature or other characteristics of the business, called descriptive designations, are not inherently distinctive but can acquire distinctiveness through use. RESTATEMENT § 13(b). Acquired distinctiveness, also called secondary meaning, occurs when the relevant consuming public has come to recognize the designation as one that identifies the business. Id. Secondary meaning can be established through direct evidence, such as consumer surveys and customer testimony, or through circumstantial evidence, such as evidence of exclusivity of use, length and manner of the designation's use, amount and manner of advertising, amount of sales, market share, and number of customers. Spheeris Sporting Goods, Inc. v. Spheeris on Capitol, 157 Wis.2d 298, 312, 459 N.W.2d 581, 587-88 (Ct.App.1990). ⁵

A designation that is understood by prospective purchasers to denominate the general category, type or class of the goods, services or business with which it is used is a generic designation. RESTATEMENT § 15. The user of a generic designation can never acquire rights in that designation as a trade name. Id.

Once the plaintiff has established that the designation it seeks to protect is distinctive, either inherently so or through secondary meaning, it must prove that the defendant's use of a similar designation will cause a likelihood of confusion. This is also

                described as proving "confusing similarity." 6  The factors[203 Wis.2d 237]  pertinent to proving likelihood of confusion are:  the distinctiveness or "strength" of plaintiff's trade name;  similarity of the defendant's designation to plaintiff's trade name;  similarity and proximity of the goods or services offered by plaintiff and defendant;  overlap of marketing channels;  degree of care likely to be exercised by consumers in selecting the product or service;  evidence of actual confusion;  and defendant's intent when selecting its designation.  See Spheeris Sporting Goods, 157 Wis.2d at 309 n. 4, 459 N.W.2d at 586
                

Standard of Review

Whether a designation is generic, descriptive or inherently distinctive is a question of fact, see 1 J. THOMAS MCCARTHY, MCCARTHY ON TRADEMARKS AND UNFAIR COMPETITION § 11.10 (3d ed. 1996) [hereinafter MCCARTHY ON TRADEMARKS], as is the determination of whether there is secondary meaning, Spheeris Sporting Goods, 157 Wis.2d at 311, 459 N.W.2d at 587. The parties dispute whether the question of likelihood of confusion is a question of law or fact. Madison Reprographics is correct that in Spheeris Sporting Goods we stated that whether trade names are confusingly similar is a question of law. Id. at 309, 459 N.W.2d at 586. We cited a federal court decision, Gaston's White River Resort v. Rush, 701 F.Supp. 1431 (W.D.Ark.1988), which represents the minority view among the federal courts. See MCCARTHY ON TRADEMARKS § 23.22[d].

In Spheeris Sporting Goods, we did not discuss First Wisconsin Nat'l Bank, which upheld a trial court's finding of likelihood of confusion because it was "not contrary to the great weight and clear preponderance of the evidence." The "great weight and clear preponderance" standard is essentially the same as the "clearly erroneous" standard. Noll v. Dimiceli's, Inc., 115 Wis.2d 641, 643, 340 N.W.2d 575, 577 (Ct.App.1983). Nor did we discuss Hirsch v. S.C. Johnson & Son, Inc., 90 Wis.2d 379, 280 N.W.2d 129 (1979), in which the supreme court stated that the question of likelihood of confusion is a question for the jury. Id. at 403, 280 N.W.2d at 140. When a court of appeals decision conflicts with a supreme court opinion, we must follow the supreme court opinion. State v. Clark, 179 Wis.2d 484, 493-94, 507 N.W.2d 172, 175 (Ct.App.1993). Following First Wisconsin Nat'l Bank and Hirsch, we conclude that the question of whether use of a designation is likely to cause confusion with, or is confusingly...