Plasticolor Molded Products v. Ford Motor Co.

Decision Date28 April 1989
Docket NumberNo. CV 85-3863-AK (Tx).,CV 85-3863-AK (Tx).
Citation713 F. Supp. 1329
CourtU.S. District Court — Central District of California
PartiesPLASTICOLOR MOLDED PRODUCTS, Plaintiff-Counterdefendant, v. FORD MOTOR COMPANY, Defendant-Counterclaimant.

COPYRIGHT MATERIAL OMITTED

Harold L. Jackson, Jackson & Jones, Tustin, Cal., Manuel S. Klausner, Kindel & Anderson, Los Angeles, Cal., for plaintiff-counterdefendant.

Charles R. Mandley, Jr., Pattishall, McAuliffe, Newbury, Hilliard & Geraldson, Chicago, Ill., Mark S. Lee, Lawler, Felix & Hall, Los Angeles, Cal., for defendant-counterclaimant.

OPINION

KOZINSKI, Circuit Judge.*

The use of trademarks to identify the source of products is as old as the modern market economy. While the use of marks to signify ownership of goods dates back thousands of years,1 the trademark as we know it today most likely originated with the medieval guilds of Europe, who often required members to identify their products "to facilitate the tracing of `false' or defective wares and the punishment of the offending craftsman." F. Schechter, The Historical Foundations of the Law Relating to Trade-marks 47 (1925). As markets for durable goods grew larger, and the likelihood of personal contact between manufacturer and purchaser accordingly diminished, trademarks became increasingly important in guaranteeing the source and quality of products.

As the value of trademarks grew, so did the incentive to appropriate them. A cause of action for copying someone else's trademark and placing it on one's own merchandise was recognized by the early seventeenth century. See Southern v. How, Popham 143, 79 Eng. Reprint 1243 (1618). The common law of unfair competition and trademark infringement was imported into American law in the early nineteenth century, and by the middle of that century had become an unquestioned aspect of trade regulation. See, e.g., Taylor v. Carpenter, 23 F.Cas. 742 (C.C.D.Mass.1844) (No. 13,784) (Story, J.).2 With minor exceptions, trademarks remained a matter of common law until 1946, when Congress passed the Lanham Act and established the current statutory framework for registering marks and redressing claims of infringement.3

Throughout the development of trademark law, the purpose of trademarks remained limited and constant: identification of the manufacturer or sponsor of a product. Product features could therefore be divided into two categories. Features that served to identify the source of a product were protected by trademark law, and could not be copied by others. On the other hand, features that served as functional components of a product — if the product could not work or would not be as desirable without them — were unprotected by trademark law. Others were free to copy these features, subject only to whatever protection was available under patent law. In the vast majority of cases, the mutual exclusivity of the categories was airtight. Names of products were source-identifiers, and hence protected; physical attributes of products were functional, and hence unprotected. See, e.g., Best Lock Corp. v. Schlage Lock Co., 413 F.2d 1195 (C.C.P.A.1969) (figure eight configuration of lock functional and therefore unprotected).4

Only relatively recently have trademarks begun to leap out of their role as source-identifiers and, in certain instances, have effectively become goods in their own right. When sports fans wear jackets bearing the names of their favorite teams, when listeners of popular music wear T-shirts and buttons emblazoned with the names of musical groups, when followers of fashion wear blue jeans with names of fictitious people sewn into the pockets (a practice which, mercifully, is no longer as popular as it was a decade ago), they are using registered trademarks and service marks, but not to identify the source of the product. The wearer of a baseball jacket reading New York Mets does not care whether the New York Mets manufactured the jacket, or authorized its production, or are in any way associated with it. He wears it to announce his allegiance. New York Mets may well be a service mark, but in this context it has become a product as well; it is a functional component of the jacket as surely as the material from which the jacket is made.5

A small but growing number of cases has recognized this change, and has found no difficulty in applying the source-identifying/functional distinction where trademarks or service marks serve purely as functional features. See International Order of Job's Daughters v. Lindeburg & Co., 633 F.2d 912 (9th Cir.1980) (insignia of young women's fraternal organization is functional element of jewelry), cert. denied, 452 U.S. 941, 101 S.Ct. 3086, 69 L.Ed. 2d 956 (1981); University of Pittsburgh v. Champion Prods., Inc., 566 F.Supp. 711 (W.D.Pa.1983) (name of university is functional element of shirts); Bi-Rite Enters., Inc. v. Button Master, 555 F.Supp. 1188 (S.D.N.Y.1983) (names of recording artists are functional elements of buttons).

These cases have presented no difficulty for the traditional categories of trademark law because, as in the New York Mets hypothetical, it has been clear that the ordinary purchaser has treated the marks as functional items, not as source-identifiers. This is because the mark and the product have represented radically different industries; reasonable purchasers could not believe or care that the mark holder would be competing in the same market as the product manufacturer. E.g., Job's Daughters (fraternal organization and jewelry production); University of Pittsburgh (educational/athletic services and clothing production); Bi-Rite Enterprises (music services and button production). Where the mark and the product come from the same or similar industries, however, the distinction between the categories blurs, because a mark can serve simultaneously as a source-identifier and a functional element.

This case presents such a situation. We find ourselves at the intersection of what have been, until now, two mutually exclusive areas of trademark law.

I. Facts

This lawsuit was brought by Plasticolor Molded Products, Inc., seeking a declaratory judgment of its rights to use Ford Motor Company trademarks on the automobile accessories it produces. Ford then counterclaimed for trademark infringement and unfair competition under the Lanham Act, 15 U.S.C. §§ 1114, 1125(a) (1982), and under California law. Ford moved for summary judgment, which was denied. Plasti-color Molded Prods. v. Ford Motor Co., 698 F.Supp. 199 (C.D.Cal.1988). On December 29, 1988, the court heard argument on both parties' renewed motions for summary judgment.

A. The Prior Opinion

In its prior ruling on Ford's first motion for summary judgment, the court made six findings of fact. All are relevant to the motions currently under consideration. For convenience, they are reproduced below.

1. Ford is a Delaware corporation with its principal place of business in Dearborn, Michigan. It has for many decades manufactured, advertised and sold motor vehicles, parts and accessories, including floor mats, mudflaps and step treads (collectively, "floor mats"). It has advertised its automotive parts and accessories extensively throughout the country, and has sold them through independent Ford dealers. In addition, it sells its parts through repair shops, discount stores and other mass merchandisers.

2. Ford has long used various arbitrary and distinctive marks to identify its products, including FORD, AEROSTAR, BRONCO, CAPRI, COUGAR, COURIER, ESCORT, EXP, FIESTA, LYNX, MERCURY, MUSTANG, PINTO, RANGER, TEMPO, THUNDERBIRD, and TOPAZ, as well as certain pictorial designs, among them the Mustang "running horse" and Thunderbird symbols. Through Ford's long and extensive use of these trademarks, they have acquired a secondary meaning signifying Ford and its products, and have acquired substantial good will that increases Ford's recognition and the attractiveness of its products to consumers.

3. Ford has attempted to protect its trademarks through federal trademark registration. It owns federal registrations for the FORD trademark for a variety of automotive products, including a 1929 registration for floor mats. Ford has also registered its BRONCO, CAPRI, COUGAR, COURIER, FIESTA, MERCURY, PINTO, RANGER, and THUNDERBIRD trademarks; these registrations have become incontestable and are conclusive evidence of Ford's exclusive rights to the marks. See 15 U.S.C. §§ 1065, 1115(b) (1982). Ford has also registered its Mustang and Thunderbird designs.

4. Plasticolor is a California corporation with its principal place of business in Fullerton, California. Since 1971 it has engaged in the business of manufacturing and selling plastic automobile accessories, including floor mats. It produces these items in a variety of designs and colors, some bearing designs or other graphics. Plasticolor sells its products through independent Ford dealers, automotive chains, catalog houses, mass merchandisers, van converters, repair shops and garages — many of the same outlets Ford uses for its own similar products or other parts. Plasticolor has promoted its products through brochures and industry trade shows, but has not engaged in substantial media advertising aimed at the consuming public.

5. In 1973, Plasticolor began selling small quantities of its accessories bearing Ford's PINTO trademark and Mustang design without license or any other authorization from Ford. Later, still without authorization, Plasticolor began selling mats and other accessories bearing other Ford marks: FORD, CAPRI, BRONCO, MERCURY, COUGAR, COURIER, FIESTA, ESCORT, RANGER, and the Mustang and Thunderbird designs. In choosing to use the Ford trademarks, Plasticolor relied on the success of the genuine Ford products sold under those marks and the good will that Plasticolor would be able to exploit.

6. Most of Plasticolor's mats bearing Ford marks are packaged with cardboard header cards bearing the word "Plasticolor";...

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