Not a Lexis Advance subscriber? Try it out for free.

George Basch Co. v. Blue Coral, Inc.

United States Court of Appeals for the Second Circuit

April 22, 1992, Argued ; June 30, 1992, Decided

Docket Nos. 91-9212, 91-9214

Opinion

 [***1353]   [*1534]  WALKER, Circuit Judge: 

Along with several issues regarding the particulars of injunctive relief, this case presents the general question of whether, in an action for trade dress infringement, a plaintiff may recover a defendant's profits without establishing that the defendant engaged in deliberately deceptive conduct. The district court concluded that bad faith [**2]  was not a necessary predicate for an accounting. We disagree. Accordingly, we hold that in order to justify an award of profits, a plaintiff must establish that the defendant engaged in willful deception.

BACKGROUND

The George Basch Co., Inc., ("Basch") manufactures and distributes NEVR-DULL, a cotton wadding metal polish. NEVR-DULL is packaged in a five ounce cylindrical metal can, about 3-1/2 inches high by 3-1/2 inches in diameter, and navy blue in color. Along with a product description and directions, the product's name is printed on the can in white block lettering. On either side of the product's name there are two red and white icons that depict what the product may be used for: the radiator grill of a car, silverware, a brass lamp, and a motor boat on a trailer.

Appellants, Blue Coral, Inc., its subsidiary Simoniz Canada Ltd., and their mutual president, Michael Moshontz (hereafter collectively referred to as "Blue Coral") manufacture and distribute a line of automotive wheel cleaning and polishing products. In both the United States and Canada, Blue Coral markets these products under the trademark ESPREE. In 1987, Blue Coral approached Basch with respect to becoming Basch's [**3]  exclusive NEVR-DULL distributor in Canada. By agreement of the parties, effective July 28, 1987, Blue Coral became NEVR-DULL's exclusive Canadian distributor. NEVR-DULL was not sold under the ESPREE mark, and its Canadian trade dress remained substantially the same as the United States' version, with the exception that the French language was employed on the front of the can.

In April 1988, Blue Coral asked Basch to produce a wadding metal polish for Blue Coral to market in the United States. Blue Coral intended to add the polish to its line of ESPREE products. The parties negotiated through August of that year, at which time they ended their talks unsuccessfully due to an impasse regarding price. Blue Coral ultimately contracted with another manufacturer of metal polish.

Read The Full CaseNot a Lexis Advance subscriber? Try it out for free.

Full case includes Shepard's, Headnotes, Legal Analytics from Lex Machina, and more.

968 F.2d 1532 *; 1992 U.S. App. LEXIS 15114 **; 23 U.S.P.Q.2D (BNA) 1351 ***

THE GEORGE BASCH CO., INC., Plaintiff-Appellee-Cross-Appellant, -v.- BLUE CORAL, INC., SIMONIZ CANADA, LTD., and MICHAEL MOSHONTZ, Defendants-Appellants-Cross-Appellees.

Prior History:  [**1]  Appeal from the judgment and order of the United states District Court for the Eastern District of New York (Hon. Jacob Mishler, Judge, and jury) finding defendants had infringed the trade dress of plaintiff's wadding metal polish, awarding plaintiff $ 200,000 in defendants' profits, and enjoining defendants from continuing to use the infringing trade dress.

Disposition: Affirmed in part; reversed in part; and jury award vacated.

CORE TERMS

Blue, infringement, profits, trade dress, damages, accounting, district court, deceptive, sales, secondary meaning, consumer confusion, injunction, unjust enrichment, Lanham Act, willful, Products, color, manufacture, equitable, trademark, cases, metal, district judge, bad faith, deliberate, consumer, monetary, awards, polish, likelihood of confusion

Business & Corporate Compliance, Federal Unfair Competition Law, False Designation of Origin, Elements of False Designation of Origin, Trademark Law, False Advertising, General Overview, Lanham Act, Entertainment Industry Falsity & Performance Misattribution, Trade Dress Protection, Causes of Action, Subject Matter of Trademarks, Terms With Inherent Distinctiveness, Terms Requiring Secondary Meaning, Special Marks, Trade Names, Civil Procedure, Trials, Judgment as Matter of Law, Judgment Notwithstanding Verdict, Remedies, Damages, Copyright Law, Types of Damages, Infringement Profits, Judicial Officers, Judges, Discretionary Powers, Likelihood of Confusion, Consumer Confusion, Infringement Actions, Standards of Review, Antitrust & Trade Law, Private Actions, Costs & Attorney Fees, Clayton Act, Attorney Fees & Expenses, Basis of Recovery, Statutory Awards