Welding Services, Inc. v. Forman

• Decision Date: 17 December 2007
• Docket Number: No. 06-13174.,06-13174.
• Citation: 509 F.3d 1351
• Parties: WELDING SERVICES, INC., Plaintiff-Appellant, v. Terry FORMAN, Welding Technologies, Inc., Robert Henson, Charles Jones, Rod Forman, Defendants-Appellees.
• Court: U.S. Court of Appeals — Eleventh Circuit

509 F.3d 1351

WELDING SERVICES, INC., Plaintiff-Appellant, v. Terry FORMAN, Welding Technologies, Inc., Robert Henson, Charles Jones, Rod Forman, Defendants-Appellees.

No. 06-13174.

United States Court of Appeals, Eleventh Circuit.

December 17, 2007.

Amanda S. Thompson, David Wayne Long-Daniels, Ernest L. Greer, James Jay Wolfson, Dorsey E. Hopson, II, Greenberg Trauig, LLP, Atlanta, GA, for Plaintiff-Appellant.

Charlene R. Swartz, Steven G. Hill, Hill, Kertscher & Wharton, LLP, Atlanta, GA, for Defendants-Appellees.

Appeal from the United States District Court for the Northern District of Georgia.

Before EDMONDSON, Chief Judge, and TJOFLAT and GIBSON,^* Circuit Judges.

GIBSON, Circuit Judge:

Welding Services, Inc. appeals from the district court's entry of summary judgment against it on its claim that Welding Technologies, Inc., its General Manager, Terry Forman, and its Vice President, Robert Henson, infringed Welding Services' service marks in violation of the Lanham Act, 15 U.S.C. § 1125(a). Welding Services contends that there are triable issues of fact as to whether the companies' service marks are confusingly similar, whether there has been actual confusion about which company was designated by Welding Technologies' marks, and whether Welding Technologies intended to infringe on Welding Services' marks. We affirm the judgment of the district court.

I.

Welding Services and Welding Technologies are rival companies providing services for maintaining equipment used in heavy industry. Since 1990 Welding Services has been using the abbreviation¹ "WSI," and since February 1994, it has been using a stylized logo consisting of the initials WSI, surrounded by a circle, as shown in the margin.

NOTE: OPINION CONTAINING TABLE OR OTHER DATA THAT IS NOT VIEWABLE

Welding Technologies was founded in 2003. In May 2005, a group of former Welding Services employees bought Welding Technologies from the original owners. The individual defendants Terry Forman and Robert Henson are former employees of Welding Services who moved to Welding Technologies.² When Welding Technologies was created in 2003, the original owners had a sister company, Orbital Tool Technologies, Inc., a machining business. The owners hired an advertising company, Fetelli, Inc., to design twin logos for the two companies. The logos for both companies showed the company's initials with an orange "rotational symbol intended to convey the rotational movement of [Orbital Tool's] machining equipment." The Welding Technologies logo is shown in the margin.

NOTE: OPINION CONTAINING TABLE OR OTHER DATA THAT IS NOT VIEWABLE

Welding Services brought this suit alleging federal trademark infringement on its abbreviation and stylized logo under section 4 of the Lanham Act, 15 U.S.C. § 1125(a)(1)(A), as well as state law causes of action for unfair competition, false and deceptive trade practices, misappropriation of trade secrets, tortious interference with business relations, and other related theories. Welding Services and Welding Technologies made cross-motions for summary judgment on the Lanham Act claim, and Welding Technologies also moved for summary judgment on the state deceptive trade practices and unfair competition claims. The district court granted summary judgment to Welding Technologies on the only federal claim and on the state law claims for unfair competition and deceptive trade practices. The court declined to exercise supplemental jurisdiction over the remaining state law claims and so dismissed those claims.

On appeal, Welding Services' argument focuses on its federal Lanham Act claim. It argues that the district court erred in holding that Welding Services had not adduced a genuine question of material fact as to whether Welding Technologies' use of "WTI" and the logo above created a likelihood of confusion. Welding Technologies, on the other hand, argues that the district court should have held that Welding Services has not shown that the abbreviation "WSI" was entitled to trademark protection.

II.

We review de novo a district court's grant of summary judgment. Stewart v. Booker T. Washington Ins., 232 F.3d 844, 848 (11th Cir.2000). Summary judgment is proper only if the record before the district court shows that there is no genuine issue as to any material fact and Welding Technologies is entitled to judgment as a matter of law. Fed. R.Civ.P. 56(c). We must view the evidence in the light most favorable to Welding Services, rather than weighing the evidence ourselves or making credibility determinations. Stewart, 232 F.3d at 848. Upon motion and after adequate discovery, a district court may enter judgment "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). This court may affirm on any ground supported by the record. Bircoll v. Miami-Dade County, 480 F.3d 1072, 1088 n. 21 (11th Cir.2007).

To make a claim for infringement of its service marks, Welding Services must show: (1) that its service marks were entitled to protection and (2) that Welding Technologies' abbreviated name and logo were identical to those marks or so similar that they were likely to confuse consumers. 15 U.S.C. § 1125(a); Int'l Stamp Art, Inc. v. U.S. Postal Serv., 456 F.3d 1270, 1274 (11th Cir.2006) (per curiam).

III.

The district court considered the issue of whether Welding Services' marks were protected, but declined to enter summary judgment against Welding Services on that ground because the court was concerned that there was some evidence that the marks had acquired secondary meaning (although as to the abbreviation mark, the court's holding is ambiguous and may be read to mean that the abbreviation was not protected). On appeal, Welding Technologies argues that the abbreviation "WSI" is not protectable because it is generic.

At the outset, we observe that at the time of the district court's decision, Welding Services had not successfully registered either the abbreviation WSI or the stylized logo. Its application to register "Welding Services Inc." had been refused by the Patent and Trademark Office's examining attorney on the ground that the proposed mark was merely descriptive or generic as applied to the welding services identified. Its application to register "WSI" was refused on the ground that the mark was confusingly similar to a prior registered WSI mark used to sell highly related services. In its reply brief before this court, Welding Services first advised us that after the date of the district court's decision, the abbreviation and logo had been accepted by the Patent and Trademark Office for registration. Further, at oral argument, Welding Services' counsel advised us that it had successfully registered the abbreviation "WSI" and the stylized logo. We ordinarily do not review materials outside the record on appeal as designated by Fed. R.App. P. 10(a), although we have the equitable power to do so if it is in the interest of justice. See Schwartz v. Millon Air, Inc., 341 F.3d 1220, 1225 n. 4 (11th Cir.2003). However, Welding Services has neglected to address before this court the ramifications that registration would have on allocation of the burden of proof on the issues of protectability and strength of the marks.³ Nor has Welding Services moved to reopen the district court proceedings to enlarge the record. In light of these omissions and of the fact that Welding Services as plaintiff filed this case and also filed a summary judgment motion before the registration was complete, we conclude that justice does not require us to deviate from the ordinary rule that the appeal is decided on the record before us. See Star Indus., Inc. v. Bacardi & Co., 412 F.3d 373, 381-83 (2d Cir.2005) (where mark not registered until after district court entered judgment and district court declined to reopen the trial record to include new evidence of registration, court considered protectability without reference to registration), cert. denied, 547 U.S. 1019, 126 S.Ct. 1570, 164 L.Ed.2d 298 (2006).

Trademark or service mark protection is only available to "distinctive" marks, Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768-69, 112 S.Ct. 2753, 120 L.Ed.2d 615 (1992), that is, marks that serve the purpose of identifying the source of the goods or services, see Colt Defense LLC v. Bushmaster Firearms, Inc., 486 F.3d 701, 705 (1st Cir.2007). Some marks are inherently distinctive; some marks, though not inherently distinctive, acquire distinctiveness by becoming associated in the minds of the public with the products or services offered by the proprietor of the mark; and some marks can never become distinctive. Two Pesos, 505 U.S. at 768-69, 112 S.Ct. 2753; Coach House Rest., Inc. v. Coach & Six Rests., Inc., 934 F.2d 1551, 1560 (11th Cir.1991). Distinctiveness is a question of fact, whether the question is inherent distinctiveness or acquired distinctiveness. Investacorp, Inc. v. Arabian Inv. Banking Corp., 931 F.2d 1519, 1523 (11th Cir.1991); Coach House, 934 F.2d at 1560.

Trademark law distinguishes four gradations of distinctiveness of marks, in descending order of strength: fanciful or arbitrary, suggestive, descriptive, and generic. An arbitrary or fanciful mark bears no logical relationship to the product or service it is used to represent. Soweco, Inc. v. Shell Oil Co., 617 F.2d 1178, 1184 (5th Cir.1980) (giving example of "Kodak"). A suggestive mark refers to some characteristic of the goods, but requires a leap of the imagination to get from the mark to the product. Id. (giving example of "Penguin" for refrigerators). A descriptive mark identifies a characteristic or quality of the service or product. Id. at 1183-84 (giving example of "Vision Center" for eyeglasses store).

There are several different approaches to...