Merriam-Webster, Inc. v. Random House, Inc.

• Decision Date: 09 September 1994
• Docket Number: Nos. 959,MERRIAM-WEBSTE,D,960,961 and 962,INC,s. 959
• Citation: 35 F.3d 65,32 U.S.P.Q.2d 1010
• Parties: , Plaintiff-Appellee-Cross-Appellant, v. RANDOM HOUSE, INC., Defendant-Appellant-Cross-Appellee. ockets 93-7276, 93-7362, 93-7728 and 93-7776.
• Court: U.S. Court of Appeals — Second Circuit

Page 65

35 F.3d 65

32 U.S.P.Q.2d 1010

MERRIAM-WEBSTER, INC., Plaintiff-Appellee-Cross-Appellant, v. RANDOM HOUSE, INC., Defendant-Appellant-Cross-Appellee.

Nos. 959, 960, 961 and 962, Dockets 93-7276, 93-7362,

93-7728 and 93-7776.

United States Court of Appeals,

Second Circuit.

Argued Dec. 15, 1993.

Decided Sept. 9, 1994.

Robert G. Sugarman, Weil, Gotshal & Manges, New York City (Nancy Scherer, Lori Pines, Weil, Gotshal & Manges, Ellis B. Levine, Diana R. Frost, Random House, Inc., Ralph P. Huber, Pamela A. Rask, Sabin Bermant & Gould, of counsel), for defendant-appellant-cross-appellee.

Lile H. Deinard, Schreiber, Simmons, MacKnight & Tweedy, New York City (Alan N. Sutin, Brian D. Graifman, Schreiber, Simmons, MacKnight & Tweedy, of counsel), for plaintiff-appellee-cross-appellant.

Before: MESKILL, WINTER, and PRATT, Circuit Judges.

WINTER, Circuit Judge:

Random House, Inc. appeals from Judge McKenna's order granting a permanent injunction under the Lanham Act Sec. 43(a), 15 U.S.C. Sec. 1125(a) (1988), against infringement of Merriam-Webster, Inc.'s trade dress for the dust jackets of its dictionaries. We hold that, as a matter of law, no confusion or likelihood of confusion exists between the respective jackets. We also hold there is no dilution under New York law of either Merriam-Webster's trademarks or trade dress. We therefore vacate the injunction and order dismissal of the complaint. In light of that disposition, we need not address the various forms of other appellate relief sought by the parties through a petition for writ of mandamus and cross-appeal.

BACKGROUND

Merriam-Webster publishes a variety of reference works that depict on the front cover of the dust jacket its "bull's eye" logo--a large white circle containing the word "Webster's" and a description of the type of work. Merriam-Webster has registered this logo as a trademark with the Patent and Trademark Office. The present action involves the ninth edition of Merriam-Webster's hardcover, abridged, desk-top dictionary that has been published in numerous editions since 1898. As described by Merriam-Webster's expert, the dictionary is one of a genre of works known as "college" dictionaries and is the market leader in this field. The eighth edition, published in 1973, bore the title Webster's New Collegiate Dictionary. The ninth edition was published in 1983 and bore the title Webster's Ninth New Collegiate Dictionary. The jacket design for the ninth edition is the one at issue in the instant matter.

The jacket has a bright red background. The front is dominated by the "bull's eye" logo--a large circle with a thin white outer rim, a thin blue inner rim, a central area with Random House has published a "college" dictionary since 1947. In 1968, it titled its product "The Random House College Dictionary." The dictionary was marketed with a red dust jacket, the title in large black and white letters, and Random House's "house" logo--an angular drawing of a house--in white. The spine displayed the word "Dictionary" in large white letters.

                a background of white and the title, "Webster's Ninth New Collegiate Dictionary" in blue.  The diameter of the "bull's-eye" is slightly over 6".  The jacket is roughly 10" by 6 3/4".  The words "A Merriam-Webster" appear in white script above the "bull's-eye."   The word "Webster's" appears in white vertically on the spine and occupies close to half the space.  Horizontally in smaller type appear "Webster's Ninth New Collegiate Dictionary" at the top of the spine and "Merriam Webster" at the bottom.  Both are in white
                

The dispute underlying this action began in 1990, when Random House introduced a dictionary titled Webster's College Dictionary. The jacket is a slightly different shade of red than the plaintiff's dictionary jacket. Apart from the insertion of the word "Webster's," the new edition differs from the previous one only in that the words "Random House" and the "house" logo are slightly diminished in size, and the word "the" is deleted from the cover. Although smaller than in the prior edition, the logo and words "Random House" are in black and occupy roughly one-third of the front jacket. "Random House" is in block lettering and appears four more times on the outside jacket. The spine displays the word "Webster's" vertically in large white letters. Horizontally, in smaller black letters, is "Random House" at the top along with the "house" logo and "College Dictionary" at the bottom of the spine.

Several other publishers market a dictionary with the designation "Webster's" in the title. For example, Houghton Mifflin introduced its Webster's II New Riverside University Dictionary in 1984. Simon & Schuster introduced its Webster's New World Dictionary, Third College Edition in 1988. Both dictionaries are also marketed with a red dust jacket and with some of the title words lettered in white.

On February 20, 1991, Merriam-Webster brought the present action for infringement of its trademark, seeking damages, Random House's profits, and a permanent injunction under the Lanham Act Sec. 43(a) and New York General Business Law Secs. 368-d, 349 (McKinney 1988). Merriam-Webster moved for a preliminary injunction, which was denied, following an evidentiary hearing. The district court concluded that "there is not a likelihood of confusion warranting the issuance of a preliminary injunction." The key differences cited by the district court were the presence of Merriam-Webster's name and "bull's eye" motif on the cover of its dictionary and the words "Random House" and "house" logo on the front jacket of the Random House dictionary. Merriam-Webster then amended its complaint to include a claim for infringement of its trade dress under Lanham Act Sec. 43(a).

Following a four-week trial, the jury answered nineteen questions on a special verdict form. The jury found that the phrase "Webster's Collegiate" as applied to dictionaries is a valid although unregistered trademark of Merriam-Webster. It found that the mark is not generic but is descriptive and had acquired secondary meaning. However, the jury found that Random House had not infringed Merriam-Webster's trademarks in either the words "Webster's Collegiate" or in the "bull's eye" logo. The jury did find, however, that Random House had diluted the distinctiveness of Merriam-Webster's trademark "Webster's Collegiate" in violation of New York law.

Addressing the trade-dress claims, the jury found that Merriam-Webster's trade dress is distinctive and had acquired secondary meaning. It further found that Random House had infringed that trade dress. Moreover, the jury found that Random House had diluted the distinctiveness of the trade dress but not the distinctiveness of the "bull's eye" logo. Finally, the jury found that Random House's trade dress infringement was intentional and awarded Merriam-Webster $1,774,713 for its lost profits, but nothing for Random House's net profits. The jury also found that the infringement was done "maliciously In response to the interrogatories on Random House's counterclaims, the jury found that the word "collegiate" as applied to dictionaries is not generic, but descriptive and had acquired secondary meaning. However, the jury found also that the word "Webster's" as applied to dictionaries is generic.

or in wanton disregard of the rights of Merriam-Webster" warranting the award of $500,000 in punitive damages on the common law trade dress infringement claim, but not the award of attorneys' fees.

Following the verdict, the district court entered a judgment including damages under the Lanham Act and common law claims ¹ and an injunction. The injunction enjoined Random House from using its current jacket design or using the words "Webster's" or "College" on dictionaries that do not adhere to a stringent set of restrictions intended to differentiate the two companies' products. ²

Random House moved for a judgment as a matter of law pursuant to Fed.R.Civ.P. 50 or alternatively for a new trial pursuant to Fed.R.Civ.P. 59. Merriam-Webster cross-moved for partial judgment as a matter of law under Rule 50 as to their request for attorneys' fees. The district court denied both motions,

but vacated the jury's award of Random House's profits and granted Random House a new trial on the issue of whether its conduct constituted "willful deception" under the standard announced in our intervening decision in George Basch Co. v. Blue Coral, Inc., 968 F.2d 1532, cert. denied, --- U.S. ----, 113 S.Ct. 510, 121 L.Ed.2d 445 (1992). Merriam-Webster, Inc. v. Random House, Inc., 815 F.Supp. 691, 700-01 (S.D.N.Y.1993).

DISCUSSION

We have jurisdiction over the appeal from a permanent injunction under 28 U.S.C. Sec. 1292(a)(1).

1. Trade Dress Infringement

"A product's trade dress is its total image" composed of "features such as size, shape, color or color combinations, texture, [or] graphics." Paddington Corp. v. Attiki Importers & Distribs., 996 F.2d 577, 582 (2d Cir.1993) (internal quotations and citation omitted). Lanham Act Sec. 43(a)(1) protects trade dress by creating a cause of action against

[a]ny person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which--

(1) is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person....

15 U.S.C. Sec. 1125(a) (1988).

In order to demonstrate infringement of its trade dress, Merriam-Webster had to show, first, that its trade dress had acquired secondary meaning or is inherently distinctive, and, second, that a likelihood of confusion exists...