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Star Indus. v. Bacardi & Co. - 412 F.3d 373 (2d Cir. 2005)


An unregistered mark is entitled to protection under the Lanham Act if it would qualify for registration as a trademark.  To qualify for registration a mark must be sufficiently "distinctive" to distinguish the registrant's goods from those of others.  Such distinctiveness may be demonstrated in either of two ways. The mark may be "inherently distinctive" if its intrinsic nature serves to identify its particular source. Alternatively, even if not inherently distinctive, the mark may be distinctive by virtue of having acquired a "secondary meaning" in the minds of consumers.


Plaintiff Star Industries, Inc. (Star) produces alcoholic beverages including the "Georgi" brand of vodkas. Georgi vodka is sold primarily in New York state, and is one of the top selling vodkas in the New York metropolitan area. Defendants Bacardi & Co. Ltd. and Bacardi U.S.A. (Bacardi) produce, import, and distribute "Bacardi" brand rums. Bacardi is the largest selling brand of hard liquor in the United States. Defendant Anheuser-Busch, Inc. is one of the leading producers of beers and malt beverages. In June 1996, inspired by the success of flavored vodkas, Star's president decided to develop an orange-flavored Georgi vodka, with a new label design that incorporated the traditional Georgi label and a large elliptical letter "O" appearing below the "Georgi" logo and surrounding all of the other elements. However, the U.S. Patent and Trademark Office (PTO) denied Star's application to register "Georgi O" as a word trademark. In 2000 Bacardi began to develop an orange-flavored rum, which it ultimately introduced nationally in 2001 under the name "Bacardi O," which designed a label that, in some respects, was similar to the Georgi O label that had been rejected by the PTO. Subsequently, Anheuser-Bush launched a new orange-flavored version of its "Bacardi Silver" malt beverage, under the name "Bacardi Silver O3." This product also contained the Bacardi "O" design on the label. 

Star filed a federal trademark infringement claims against defendants Bacardi and Anheiser-Busch, as junior user and licensee, for trademark infringement. After a bench trial, the United States District Court for the Southern District of New York concluded that Star's mark used on its vodka products was not inherently distinctive and that it had not demonstrated that its Georgi-"O" mark had acquired secondary meaning. The district court dismissed Star's federal claims under the Lanham Trade-Mark Act, 15 U.S.C.S. § 1114, and pendent state law claims under New York statutory and common law, and also denied Star's motion to reopen the trial record and to amend the findings of fact and conclusions of law. Star sought appellate review.


Did Star's Georgi-“O” design acquire a secondary meaning making it protectable as a trademark?




The Court of Appeals for the Second Circuit concluded that the district court erred in holding the Georgi-"O" design not protectable, but agreed with the district court that Star had not established a likelihood of confusion with Bacardi's rum products. Specifically, the appellate court found the Star's "O" was not a "common basic shape" or letter but was sufficiently stylized to be inherently distinctive and protectable as a trademark. However, the Court held that the mark was weak and entitled to only limited protection. Accordingly, because Star had not demonstrated a likelihood of consumer confusion, given that only one of the eight Polaroid factors (competitive proximity) favored Star butStar's showing of proximity was not overwhelming, the appellate court held that Star's evidence of actual consumer confusion and bad faith was extremely weak, and clearly tipped in Bacardi's favor.

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