14 Basic Infringment 14 Basic Infringment

PART 3. Protecting Intellectual Property Rights

14.1 Larami Corp v. Amron 14.1 Larami Corp v. Amron

Patents

27 U.S.P.Q. 2d 1280 (E.D. Pa. 1993)

 

United States District Court, E.D. Pennsylvania.

LARAMI CORPORATION, Plaintiff, v. Alan AMRON and Talk to Me Products, Inc., Defendants.

27 U.S.P.Q.2d 1280, 1993 WL 69581

No. CIV. A. 91-6145, March 11, 1993

MEMORANDUM

REED.

[1] This is a patent case concerning toy water guns manufactured by plaintiff Larami Corporation (“Larami”). Currently before me is Larami’s motion for partial summary judgment of noninfringement of United States Patent No. 4,239,129 [click here to view patent] (“the ‘129 patent”) (Document No. 23).1

[2] This Court has jurisdiction pursuant to 28 U.S.C. §§ 1331 & 1338. For the reasons discussed below, the motion will be granted.

I. BACKGROUND

[3] Larami manufactures a line of toy water guns called “SUPER SOAKERS.” [Click here to read a history of the SUPER SOAKER line of toy water guns.] This line includes five models: SUPER SOAKER 20, SUPER SOAKER 30, SUPER SOAKER 50, SUPER SOAKER 100, and SUPER SOAKER 200. All use a hand-operated air pump to pressurize water and a “pinch trigger” valve mechanism for controlling the ejection of the pressurized water. All feature detachable water reservoirs prominently situated outside and above the barrel of the gun. The United States Patent and Trademark Office has issued patents covering four of these models. Larami does not claim to have a patent which covers SUPER SOAKER 20.

[4] Defendants Alan Amron and Talk To Me Products, Inc. (hereinafter referred to collectively as “TTMP”) claim that the SUPER SOAKER guns infringe on the ‘129 patent which TTMP obtained by assignment from Gary Esposito (“Esposito”), the inventor.2 The ‘129 patent covers a water gun which, like the SUPER SOAKERS, operates by pressurizing water housed in a tank with an air pump. In the ‘129 patent, the pressure enables the water to travel out of the tank through a trigger-operated valve into an outlet tube and to squirt through a nozzle. Unlike the SUPER SOAKERS, the ‘129 patent also contains various electrical features to illuminate the water stream and create noises. Also, the water tank in the ‘129 patent is not detachable, but is contained within a housing in the body of the water gun.

[5] The “Background of the Invention” contained in the ‘129 patent reads as follows:

Children of all ages, especially boys, through the years have exhibited a fascination for water, lights and noise and the subject invention deals with these factors embodied in a toy simulating a pistol.

An appreciable number of U.S. patents have been issued which are directed to water pistols but none appear to disclose a unique assemble of components which can be utilized to simultaneously produce a jet or stream of water, means for illuminating the stream and a noise, or if so desired, one which can be operated without employing the noise and stream illuminating means. A reciprocal pump is employed to obtain sufficient pressure whereby the pistol can eject a stream an appreciable distance in the neighborhood of thirty feet and this stream can be illuminated to more or less simulate a lazer [sic] beam.

. . . .

[6] Larami brought this action seeking a declaration that the “SUPER SOAKER” does not infringe the ‘129 patent (Count I), that the ‘129 patent is invalid (Count II), and that the assignment of the ‘129 patent from Esposito is invalid (Count III). Larami’s amended complaint also includes claims under section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and common law for damages arising from defendants’ alleged false accusations of patent and trademark infringement (Counts IV–VII). TTMP counterclaimed for infringement of the ‘129 patent.

[7] Larami has moved for partial summary judgment of noninfringement of the ‘129 patent (Count I) and for partial summary judgment on TTMP’s counterclaim for infringement of the ‘129 patent.

II. DISCUSSION

A. Summary Judgment Standard

[8] Summary judgment is as appropriate in a patent case as it is in any other.  C.R. Bard, Inc. v. Advanced Cardiovascular Systems, Inc., 911 F.2d 670, 672 (Fed. Cir. 1990). The examination to be undertaken of a summary judgment motion in federal court is set forth in Fed.R.Civ.P. 56. Rule 56(c) states that:

[t]he judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.

Fed.R.Civ.P. 56(c). A fact is material if it might affect the outcome of the suit under the governing substantive law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). “Factual disputes that are irrelevant or unnecessary will not be counted.” Id. (citing 10A C. Wright, A. Miller & M. Kane, Federal Practice & Procedure § 2725, at 93–95 (1983)). In addition, a dispute over a material fact must be “genuine,” i.e., the evidence must be such “that a reasonable jury could return a verdict in favor of the non-moving party.” Id.

When a motion for summary judgment is made and supported as provided in … [Rule 56], an adverse party may not rest upon the mere allegations or denials of the adverse party’s pleadings, but the adverse party’s response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If the adverse party does not so respond, summary judgment, if appropriate, shall be entered against the adverse party.

[9] Fed.R.Civ.P. 56(e). The evidence proffered does not have to be in a form which would be admissible at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). “Rule 56(e) permits a proper summary judgment motion to be opposed by any of the kinds of evidentiary materials listed in Rule 56(c), except the mere pleadings themselves, and it is from this list that one would normally expect the nonmoving party to make the showing … [required by Rule 56(e) ].” Id.

[10] The evidence of the nonmoving party is to be considered as true, and justifiable inferences arising from the evidence are to be drawn in his or her favor. Anderson, 477 U.S. at 255. If the evidence of the nonmoving party is “merely colorable,” or is “not significantly probative,” summary judgment may be granted. Id. at 249–50. For example, a nonmoving party may not successfully oppose a summary judgment motion by simply replacing “conclusory allegations of the complaint or answer with conclusory allegations of an affidavit.” Lujan v. Nat’l Wildlife Federation, 110 S.Ct. 3177, 3188 (1990). Rather, the nonmoving party must offer specific facts contradicting the facts averred by the movant which indicate that there is a genuine issue for trial. Id. at 3188.

[11] In this case, Larami seeks a declaratory judgment that the SUPER SOAKER water guns do not infringe the ‘129 patent. At trial, the patent holder would have the burden of proving infringement by a preponderance of the evidence.  Intellicall, Inc. v. Phonometrics, Inc., 952 F.2d 1384, 1389 (Fed. Cir.1992). Accordingly, on this motion for partial summary judgment, Larami need only point out the absence of evidence supporting a finding of infringement. Id. To resist this motion, TTMP must then come forward with specific evidence showing that there is a genuine issue of material fact for trial as to whether the ‘129 patent is infringed. Id.

B. Infringement and Claim Interpretation

[12] A patent owner’s right to exclude others from making, using or selling the patented invention is defined and limited by the language in that patent’s claims. Corning Glass Works v. Sumitomo Electric U.S.A., Inc., 868 F.2d 1251, 1257 (Fed. Cir.1989). Thus, establishing infringement requires the interpretation of the “elements” or “limitations” of the claim and a comparison of the accused product with those elements as so interpreted. Key Mfg. Group, Inc. v. Microdot, Inc., 925 F.2d 1444, 1448 (Fed. Cir.1991). Because claim interpretation is a question of law, it is amenable to summary judgment. Johnston v. IVAC Corp., 885 F.2d 1574, 1579–80 (Fed. Cir.1989).

[13] The words in a claim should be given their “ordinary or accustomed” meaning.  Senmed, Inc. v. Richard–Allan Medical Industries, Inc., 888 F.2d 815, 819 & n.8 (Fed. Cir.1989). An inventor’s interpretations of words in a claim that are proffered after the patent has issued for purposes of litigation are given no weight. Id.; Lear Siegler, Inc. v. Aeroquip Corp, 733 F.2d 881, 889 (Fed. Cir.1984) (“The litigation-induced pronouncements of [the inventor] … have no effect on what the words of [the patent] in fact do convey and have conveyed during its term to the public.”), quoted in Intellicall, 952 F.2d at 1388.

[14] A patent holder can seek to establish patent infringement in either of two ways: by demonstrating that every element of a claim (1) is literally infringed or (2) is infringed under the doctrine of equivalents. To put it a different way, because every element of a claim is essential and material to that claim, a patent owner must, to meet the burden of establishing infringement, “show the presence of every element or its substantial equivalent in the accused device.” Key Mfg. Group, Inc., 925 F.2d at 1447 (emphasis added). If even one element of a patent’s claim is missing from the accused product, then “[t]here can be no infringement as a matter of law … “ London v. Carson Pirie Scott & Co., 946 F.2d 1534, 1538–39 (Fed. Cir.1991).

[15] Larami contends, and TTMP does not dispute, that twenty-eight (28) of the thirty-five (35) claims in the ‘129 patent are directed to the electrical components that create the light and noise. Larami’s SUPER SOAKER water guns have no light or noise components. Larami also contends, again with no rebuttal from TTMP, that claim 28 relates to a “poppet valve” mechanism for controlling the flow of water that is entirely different from Larami’s “pinch trigger” mechanism. Thus, according to Larami, the six remaining claims (claims 1, 5, 10, 11, 12 and 16) are the only ones in dispute. Larami admits that these six claims address the one thing that the SUPER SOAKERS and the ‘129 patent have in common—the use of air pressure created by a hand pump to dispense liquid. Larami argues, however, that the SUPER SOAKERS and the ‘129 patent go about this task in such fundamentally different ways that no claim of patent infringement is sustainable as a matter of law.

[16] In its memorandum of law in opposition to Larami’s motion for partial summary judgment, TTMP points to evidence to support its assertion that only SUPER SOAKER 20 literally infringes claim 1 and that SUPER SOAKERS 20, 30, 50, 100 and 200 infringe claim 10 under the doctrine of equivalents. TTMP’s Memorandum of Law in Opposition to Larami’s Motion for Partial Summary Judgment, at 2 & 6–9 (“TTMP’s Memorandum of Law”). TTMP has neither produced nor referred to evidence contradicting facts averred by Larami on all other claims of the ‘129 patent. I conclude, therefore, that TTMP has not met its burden of coming forward with specific evidence showing that there is a genuine issue of material fact as to these claims. Accordingly, this memorandum will address only claims 1 and 10.

1. Literal Infringement of Claim 1

[17] TTMP claims that SUPER SOAKER 20 literally infringes claim 1 of the ‘129 patent. Claim 1 describes the water gun as:

[a] toy comprising an elongated housing [case] having a chamber therein for a liquid [tank], a pump including a piston having an exposed rod [piston rod] and extending rearwardly of said toy facilitating manual operation for building up an appreciable amount of pressure in said chamber for ejecting a stream of liquid therefrom an appreciable distance substantially forwardly of said toy, and means for controlling the ejection.

U.S. Patent No. 4,239,129 (bracketed words supplied; see Diagram A, the ‘129 patent, attached hereto).

Diagram A (cover page drawing)

[18] Claim 1 requires, among other things, that the toy gun have “an elongated housing having a chamber therein for a liquid.” The SUPER SOAKER 20 water gun, in contrast, has an external water reservoir (chamber) that is detachable from the gun housing, and not contained within the housing. TTMP argues that SUPER SOAKER 20 contains a “chamber therein for a liquid” as well as a detachable water reservoir. It is difficult to discern from TTMP’s memorandum of law exactly where it contends the “chamber therein” is located in SUPER SOAKER 20. Furthermore, after having examined SUPER SOAKER 20 (Exhibit L to Declaration of Robert S. Bramson, Document No. 24), I find that it is plain that there is no “chamber” for liquid contained within the housing of the water gun. The only element of SUPER SOAKER 20 which could be described as a “chamber” for liquid is the external water reservoir located atop the housing. Indeed, liquid is located within the housing only when the trigger causes the liquid to pass from the external water reservoir through the tubing in the housing and out of the nozzle at the front end of the barrel. SUPER SOAKER 20 itself shows that such a transitory avenue for the release of liquid is clearly not a “chamber therein for liquid.” Therefore, because the absence of even one element of a patent’s claim from the accused product means there can be no finding of literal infringement, London, 946 F.2d at 1538–39, I find that SUPER SOAKER 20 does not infringe claim 1 of the ‘129 patent as a matter of law.

[19] It is also important to note that TTMP expressly admitted in its answers to Larami’s requests for admissions that “[c]laim 1 [of the ‘129 patent] is not literally infringed by any of the ‘SUPER SOAKER’ water guns.” Larami’s Reply in Support of its Motion for Partial Summary Judgment, Exhibit 9, at 1. Even in the absence of this admission, however, Larami would be entitled to summary judgment of noninfringement with respect to claim 1 for the reasons discussed above.

[20] Accordingly, I conclude that the SUPER SOAKER 20 water gun does not literally infringe claim 1 of the ‘129 patent.3

2. Infringement by Equivalents of Claim 10

[21] TTMP claims that all five of the SUPER SOAKER water guns infringe claim 10 of the ‘129 patent. Claim 10 describes the arrangement of several components of the water gun as follows:

A toy simulating a pistol comprising wall structure forming an elongated barrel of appreciable cross-section dimensions [case], a tank in the barrel for a liquid [water tank] and a hollow handle, a cylinder disposed axially in said tank and provided with a check valve, a piston mounted in said cylinder for manual reciprocation for pumping air into said tank [air pump], conduit means [discharge tube] connected to said tank and having an outlet located at the front of said barrel [outlet nozzle], valve means interposed in said conduct means, and a trigger operable independently of said piston carried by said handle for operating said valve means [trigger-operated valve] for controlling the forced flow of liquid through said outlet.

U.S. Patent No. 4,239,129 (bracketed words supplied; see Diagram A, the ‘129 patent, attached hereto).

[22] To show infringement under the doctrine of equivalents, the patent owner bears the burden of proving that the accused product has the “substantial equivalent” of every limitation or element of a patent claim. Intellicall, 952 F.2d at 1389. Put another way, the patent owner must show that the accused product “performs substantially the same overall function or work, in substantially the same way, to obtain substantially the same overall result as the claimed invention.” Wilson Sporting Goods Co. v. David Geoffrey & Assoc., 904 F.2d 677, 683 (Fed. Cir.1990) (quoting Pennwalt Corp. v. Durand–Wayland, Inc., 833 F.2d 931, 934 (Fed. Cir.1987)).

[23] The doctrine of equivalents is used to hinder “the ‘unscrupulous copyist’ who could otherwise imitate a patented invention as long as [s/he] was careful not to copy every inconsequential detail of the claimed inventions, or to make some ‘unimportant and insubstantial’ change to the claimed invention.” Lear Siegler, Inc. v. Sealy Mattress Company, 873 F.2d 1422, 1425 (Fed. Cir.1989). The doctrine is reserved for the exceptional case. As the U.S. Court of Appeals for the Federal Circuit, recently stated:

[I]f the public comes to believe (or fear) that the language of patent claims can never be relied on, and that the doctrine of equivalents is simply the second prong of every infringement charge, regularly available to extend protection beyond the scope of the claims, then claims will cease to serve their intended purpose. Competitors will never know whether their actions infringe a granted patent.

[24] London, 946 F.2d at 1538. Thus, failure to produce evidence on any one of a claim’s elements can result in a grant of summary judgment against the patent owner on the infringement claim. Intellicall, 952 F.2d at 1389.

. . . .

[25] [E]ven if claim 10 were to require that the outlet nozzle be placed on the same axis as the water tank and air pump, at least one other element of the ‘129 patent is absent from the SUPER SOAKER water guns. Claim 10 requires, among other things, “a tank in the barrel for a liquid.” As discussed above with regard to claim 1, the SUPER SOAKER water guns have external water reservoirs that are detachable from the gun housing, and not contained within the housing or barrel. No SUPER SOAKER water gun has a “tank in the barrel for a liquid” as described in claim 10 of the ‘129 patent. To establish that a water tank outside of the housing or barrel is the substantial equivalent of a water tank inside the housing or barrel, TTMP must muster evidence which would create a genuine issue of material fact as to whether the outside tank would have a substantially similar function and use substantially similar means to yield a substantially similar result as the inside tank. Wilson Sporting Goods, 904 F.2d at 683.

[26] TTMP claims that the “movement of the water reservoir upwardly simply serves as a cosmetic alteration for the aesthetic looks of the water gun, and does not alter the novel operational characteristics of the water gun [covered by the ‘129 patent].” TTMP’s Memorandum of Law, at 9. The evidence, however, is to the contrary. The SUPER SOAKER design improved on the ‘129 patent and other prior art by locating the tank outside the housing. First, the external and detachable tank makes manufacturing the device simpler because it is not necessary to make the entire housing pressure tight. See Larami Corp. v. Lanard Toys Ltd., 22 U.S.P.Q.2d. 1440, 1442, 1992 U.S. Dist. LEXIS 769, at *4 (E.D.Pa.1992). Second, this design makes it easier for the consumer to fill the tank because it is detachable. Id. Third, the size and volume of the external water reservoirs are not limited by the size of the housing. Fourth, the external tanks are replaceable if they should become damaged without replacing the entire toy. Finally, users of the SUPER SOAKERS can carry additional, filled tanks on a belt or backpack and replace an empty tank without going back to a source of water. Thus, the external tanks at least function in a very different manner from the ‘129 patent.

[27] For these reasons, I conclude that there remains no genuine issue of material fact as to whether SUPER SOAKERS 20, 30, 50, 100 and 200 infringe claim 10 of the ‘129 patent under the doctrine of equivalents.

III. CONCLUSION

[28] In patent cases, summary judgment is appropriate where the accused product does not literally infringe the patent and where the patent owner does not muster evidence that is “sufficient to satisfy the legal standard for infringement under the doctrine of equivalents.” London, 946 F.2d at 1538. Thus, and for the foregoing reasons, Larami’s motion for partial summary judgment of noninfringement of the ‘129 patent will be granted.

[29] An appropriate Order follows.

ORDER

[30] AND NOW, this 11th day of March, 1993, upon consideration of the motion of plaintiff Larami Corporation for partial summary judgment of noninfringement of United States Patent No. 4,239,129 (Document No. 23), the responses of the parties thereto, and for the reasons set forth in the attached memorandum, having determined based upon the pleadings, depositions, requests for admissions, and affidavits of record that there remains no genuine issue of material fact and that Larami Corporation is entitled to judgment as a matter of law on the issue of noninfringement of United States Patent No. 4,239,129, it is hereby ORDERED that the motion is GRANTED.

[31] JUDGMENT IS HEREBY ENTERED in favor of plaintiff Larami Corporation and against defendants Alan Amron and Talk To Me Products, Inc. on plaintiff’s claim of noninfringement of United States Patent No. 4,239,129 (Count I) and on defendants’ counterclaim of infringement of United States Patent No. 4,239, 129.

[32] It is FURTHER ORDERED that, because resolution of Count I of plaintiff’s complaint renders moot Counts II and III of plaintiff’s complaint, Count II and III are hereby DISMISSED without prejudice.

[33] This is not a final adjudication.


FOOTNOTES

Footnote 1. Larami also seeks partial summary judgment on defendants’ counterclaim for infringement of the ‘129 patent.

Footnote 2. In a letter to the Court dated January 16, 1993, Esposito claims that ownership of the ‘129 patent has reverted back to him from TTMP. However, TTMP filed a complaint against Esposito in New York state court requesting a declaration that TTMP is the rightful owner of the ‘129 patent. Esposito has removed that action to the United States District Court for the Eastern District of New York. This memorandum does not address the question of ownership of the ‘129 patent.

Footnote 3. As stated above, TTMP does not argue that SUPER SOAKER 20 infringes claim 1 of the ‘129 patent under the doctrine of equivalents. Furthermore, TTMP has produced no evidence which would support a finding that there remains a genuine issue of material fact as to whether the SUPER SOAKER 20 infringes claim 1 under the doctrine of equivalents.

14.2 Steinberg v. Columbia Pictures Industries, Inc. 14.2 Steinberg v. Columbia Pictures Industries, Inc.

Copyright

663 F.Supp. 706 (1987)

Saul STEINBERG, Plaintiff,
v.
COLUMBIA PICTURES INDUSTRIES, INC.; RCA Corporation; Diener Hauser Bates Co., Inc.; Columbia Pictures International Corporation; Columbia Pictures Home Video, Inc.; RCA International Audio-Visuals, Inc.; CPT Holdings, Inc.; Gold Col Productions, Inc.; RCA/Columbia Pictures Home Video; RCA/Columbia Pictures International Video; the New York Times Company; New York News, Inc.; Newsday, Inc.; News Group Publications, Inc.; the Times Mirror Company; the Hearst Corporation; Chicago Tribune Company; Field Enterprises, Inc.; the Washington Post Co.; A.H. Belo Corporation; Globe Newspaper Company; Philadelphia Newspapers, Inc.; A.S. Abell Publishing Co.; and Knight-Ridder Newspapers, Inc., Defendants.
Saul STEINBERG, Plaintiff,
v.
COLUMBIA-DELPHI PRODUCTIONS, Columbia-Delphi Productions II, Delphi Film Associates, Delphi Film Associates II, News Group Boston, Inc., and News Group Chicago, Inc., Defendants.

Nos. 84 Civ. 9208 (LLS), 87 Civ. 1750 (LLS).

United States District Court, S.D. New York.

June 24, 1987.

[707] [708] Rembar & Curtis, New York City, for plaintiff; Charles Rembar, Frank R. Curtis, Mark W. Budwig, of counsel.

Pryor, Cashman, Sherman & Flynn, New York City, for defendants; Stephen F. Huff, Philip R. Hoffman, Tom J. Ferber, of counsel.

OPINION AND ORDER

STANTON, District Judge.

In these actions for copyright infringement, plaintiff Saul Steinberg is suing the producers, promoters, distributors and advertisers of the movie "Moscow on the Hudson" ("Moscow"). Steinberg is an artist whose fame derives in part from cartoons and illustrations he has drawn for The New Yorker magazine. Defendant Columbia Pictures Industries, Inc. (Columbia) is in the business of producing, promoting and distributing motion pictures, including "Moscow." Defendant RCA Corporation (RCA) was involved with Columbia in promoting and distributing the home video version of "Moscow," and defendant Diener Hauser Bates Co. (DHB) acted as an advertising agent for "Moscow." The other defendants were added to the complaint pursuant to a memorandum decision of this court dated November 17, 1986. These defendants fall into two categories: (1) affiliates of Columbia and RCA that were involved in the distribution of "Moscow" here and/or abroad, and (2) owners of major newspapers that published the allegedly infringing advertisement.

The defendants in the second-captioned action either are joint ventures affiliated with Columbia or are newspapers that published the allegedly infringing advertisement for "Moscow." This action was consolidated with the first by stipulation dated April 3, 1987.

Plaintiff alleges that defendants' promotional poster for "Moscow" infringes his copyright on an illustration that he drew [709] for The New Yorker and that appeared on the cover of the March 29, 1976 issue of the magazine, in violation of 17 U.S.C. §§ 101-810. Defendants deny this allegation and assert the affirmative defenses of fair use as a parody, estoppel and laches.

Defendants have moved, and plaintiff has cross-moved, for summary judgment. For the reasons set forth below, this court rejects defendants' asserted defenses and grants summary judgment on the issue of copying to plaintiff.

I

To grant summary judgment, Fed.R. Civ.P. 56 requires a court to find that "there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." In reaching its decision, the court must "assess whether there are any factual issues to be tried, while resolving ambiguities and drawing reasonable inferences against the moving party." Knight v. U.S. Fire Ins. Co., 804 F.2d 9, 11 (2d Cir.1986), citing Anderson v. Liberty Lobby, 477 U.S. 242, 106 S.Ct. 2505, 2509-11, 91 L.Ed.2d 202 (1986).

Summary judgment is often disfavored in copyright cases, for courts are generally reluctant to make subjective comparisons and determinations. Hoehling v. Universal City Studios, Inc., 618 F.2d 972, 977 (2d Cir.1980), citing Arnstein v. Porter, 154 F.2d 464, 474 (2d Cir.1946). Recently, however, this circuit has "recognized that a court may determine non-infringement as a matter of law on a motion for summary judgment." Warner Brothers v. American Broadcasting Cos., 720 F.2d 231, 240 (2d Cir.1983), quoting Durham Industries, Inc. v. Tomy Corp., 630 F.2d 905, 918 (2d Cir.1980). See also Hoehling, 618 F.2d at 977; Walker v. Time-Life Films, Inc., 615 F.Supp. 430, 434 (S.D.N.Y. 1985), aff'd, 784 F.2d 44 (2d Cir.1986), cert. denied, ___ U.S. ___, 106 S.Ct. 2278, 90 L.Ed.2d 721 (1986). "When the evidence is so overwhelming that a court would be justified in ordering a directed verdict at trial, it is proper to grant summary judgment." Silverman v. CBS Inc., 632 F.Supp. 1344, 1352 (S.D.N.Y.1986) (awarding summary judgment to defendant on counterclaim of copyright infringement).

The voluminous submissions that accompanied these cross-motions leave no factual issues concerning which further evidence is likely to be presented at a trial. Moreover, the factual determinations necessary to this decision do not involve conflicts in testimony that would depend for their resolution on an assessment of witness credibility. In addition, this case is different from most copyright infringement actions, in which it is preferable to leave the determination of the issue to a jury: each party has implied that its case is complete by moving for summary judgment, and as neither side has requested a jury, the court would be the trier of fact at trial. Finally, the interests of judicial economy are also served by deciding the case at its present stage. Summary judgment is therefore appropriate.

II

The essential facts are not disputed by the parties despite their disagreements on nonessential matters. On March 29, 1976, The New Yorker published as a cover illustration the work at issue in this suit, widely known as a parochial New Yorker's view of the world. The magazine registered this illustration with the United States Copyright Office and subsequently assigned the copyright to Steinberg. Approximately three months later, plaintiff and The New Yorker entered into an agreement to print and sell a certain number of posters of the cover illustration.

It is undisputed that unauthorized duplications of the poster were made and distributed by unknown persons, although the parties disagree on the extent to which plaintiff attempted to prevent the distribution of those counterfeits. Plaintiff has also conceded that numerous posters have been created and published depicting other localities in the same manner that he depicted New York in his illustration. These facts, however, are irrelevant to the merits of this case, which concerns only the relationship [710] between plaintiff's and defendants' illustrations.

Defendants' illustration was created to advertise the movie "Moscow on the Hudson," which recounts the adventures of a Muscovite who defects in New York. In designing this illustration, Columbia's executive art director, Kevin Nolan, has admitted that he specifically referred to Steinberg's poster, and indeed, that he purchased it and hung it, among others, in his office. Furthermore, Nolan explicitly directed the outside artist whom he retained to execute his design, Craig Nelson, to use Steinberg's poster to achieve a more recognizably New York look. Indeed, Nelson acknowledged having used the facade of one particular edifice, at Nolan's suggestion that it would render his drawing more "New York-ish." Curtis Affidavit ¶ 28(c). While the two buildings are not identical, they are so similar that it is impossible, especially in view of the artist's testimony, not to find that defendants' impermissibly copied plaintiff's.[1]

To decide the issue of infringement, it is necessary to consider the posters themselves. Steinberg's illustration presents a bird's eye view across a portion of the western edge of Manhattan, past the Hudson River and a telescoped version of the rest of the United States and the Pacific Ocean, to a red strip of horizon, beneath which are three flat land masses labeled China, Japan and Russia. The name of the magazine, in The New Yorker's usual typeface, occupies the top fifth of the poster, beneath a thin band of blue wash representing a stylized sky.

The parts of the poster beyond New York are minimalized, to symbolize a New Yorker's myopic view of the centrality of his city to the world. The entire United States west of the Hudson River, for example, is reduced to a brown strip labeled "Jersey," together with a light green trapezoid with a few rudimentary rock outcroppings and the names of only seven cities and two states scattered across it. The few blocks of Manhattan, by contrast, are depicted and colored in detail. The four square blocks of the city, which occupy the whole lower half of the poster, include numerous buildings, pedestrians and cars, as well as parking lots and lamp posts, with water towers atop a few of the buildings. The whimsical, sketchy style and spiky lettering are recognizable as Steinberg's.

The "Moscow" illustration depicts the three main characters of the film on the lower third of their poster, superimposed on a bird's eye view of New York City, and continues eastward across Manhattan and the Atlantic Ocean, past a rudimentary evocation of Europe, to a clump of recognizably Russian-styled buildings on the horizon, labeled "Moscow." The movie credits appear over the lower portion of the characters. The central part of the poster depicts approximately four New York city blocks, with fairly detailed buildings, pedestrians and vehicles, a parking lot, and some water towers and lamp posts. Columbia's artist added a few New York landmarks at apparently random places in his illustration, apparently to render the locale more easily recognizable. Beyond the blue strip labeled "Atlantic Ocean," Europe is represented by London, Paris and Rome, each anchored by a single landmark (although the landmark used for Rome is the Leaning Tower of Pisa).

The horizon behind Moscow is delineated by a red crayoned strip, above which are the title of the movie and a brief textual introduction to the plot. The poster is crowned by a thin strip of blue wash, apparently a stylization of the sky. This poster is executed in a blend of styles: the three characters, whose likenesses were copied from a photograph, have realistic faces and somewhat sketchy clothing, and the city blocks are drawn in a fairly detailed but sketchy style. The lettering on the drawing is spiky, in block-printed handwritten capital letters substantially identical to plaintiff's, while the printed texts at the top and bottom of the poster are in the [711] typeface commonly associated with The New Yorker magazine.[2]

III

To succeed in a copyright infringement action, a plaintiff must prove ownership of the copyright and copying by the defendant. Reyher v. Children's Television Workshop, 533 F.2d 87, 90 (2d Cir.1976); Durham Industries, 630 F.2d at 911; Novelty Textile Mills, Inc. v. Joan Fabrics Corp., 558 F.2d 1090, 1092 (2d Cir.1977). There is no substantial dispute concerning plaintiff's ownership of a valid copyright in his illustration. Therefore, in order to prevail on liability, plaintiff need establish only the second element of the cause of action.

"Because of the inherent difficulty in obtaining direct evidence of copying, it is usually proved by circumstantial evidence of access to the copyrighted work and substantial similarities as to protectible material in the two works." Reyher, 533 F.2d at 90, citing Arnstein v. Porter, 154 F.2d 464, 468 (2d Cir.1946). See also Novelty Textile Mills, 558 F.2d at 1092. "Of course, if there are no similarities, no amount of evidence of access will suffice to prove copying." Arnstein v. Porter, 154 F.2d at 468. See also Novelty Textile Mills, 558 F.2d at 1092 n. 2.

Defendants' access to plaintiff's illustration is established beyond peradventure. Therefore, the sole issue remaining with respect to liability is whether there is such substantial similarity between the copyrighted and accused works as to establish a violation of plaintiff's copyright. The central issue of "substantial similarity," which can be considered a close question of fact, may also validly be decided as a question of law. Berkic v. Crichton, 761 F.2d 1289, 1292 (9th Cir.1985), citing Sid & Marty Krofft Television Productions, Inc. v. McDonald's Corp., 562 F.2d 1157 (9th Cir.1977).

"Substantial similarity" is an elusive concept. This circuit has recently recognized that

[t]he "substantial similarity" that supports an inference of copying sufficient to establish infringement of a copyright is not a concept familiar to the public at large. It is a term to be used in a courtroom to strike a delicate balance between the protection to which authors are entitled under an act of Congress and the freedom that exists for all others to create their works outside the area protected by infringement.

Warner Bros., 720 F.2d at 245.

The definition of "substantial similarity" in this circuit is "whether an average lay observer would recognize the alleged copy as having been appropriated from the copyrighted work." Ideal Toy Corp. v. Fab-Lu Ltd., 360 F.2d 1021, 1022 (2d Cir.1966); Silverman v. CBS, Inc., 632 F.Supp. at 1351-52. A plaintiff need no longer meet the severe "ordinary observer" test established by Judge Learned Hand in Peter Pan Fabrics, Inc. v. Martin Weiner Corp., 274 F.2d 487 (2d Cir.1960). Uneeda Doll Co., Inc. v. Regent Baby Products Corp., 355 F.Supp. 438, 450 (E.D.N.Y.1972). Under Judge Hand's formulation, there would be substantial similarity only where "the ordinary observer, unless he set out to detect the disparities, would be disposed to overlook them, and regard their aesthetic appeal as the same." 274 F.2d at 489.

Moreover, it is now recognized that "[t]he copying need not be of every detail so long as the copy is substantially similar to the copyrighted work." Comptone Co. v. Rayex Corp., 251 F.2d 487, 488 (2d Cir. 1958). See also Durham Industries, 630 F.2d at 911-12; Novelty Textile Mills, 558 F.2d at 1092-93.

In determining whether there is substantial similarity between two works, it is crucial to distinguish between an idea and its expression. It is an axiom of copyright law, established in the case law and since codified at 17 U.S.C. § 102(b), that only the [712] particular expression of an idea is protectible, while the idea itself is not. See, e.g., Durham Industries, 630 F.2d at 912; Reyher, 533 F.2d at 90, citing Mazer v. Stein, 347 U.S. 201, 217, 74 S.Ct. 460, 470, 98 L.Ed. 630 (1954); Baker v. Selden, 101 U.S. (11 Otto) 99, 25 L.Ed. 841 (1879). See also Warner Bros., 720 F.2d at 239.

"The idea/expression distinction, although an imprecise tool, has not been abandoned because we have as yet discovered no better way to reconcile the two competing societal interests that provide the rationale for the granting of and restrictions on copyright protection," namely, both rewarding individual ingenuity, and nevertheless allowing progress and improvements based on the same subject matter by others than the original author. Durham Industries, 630 F.2d at 912, quoting Reyher, 533 F.2d at 90.

There is no dispute that defendants cannot be held liable for using the idea of a map of the world from an egocentrically myopic perspective. No rigid principle has been developed, however, to ascertain when one has gone beyond the idea to the expression, and "[d]ecisions must therefore inevitably be ad hoc." Peter Pan Fabrics, Inc. v. Martin Weiner Corp., 274 F.2d 487, 489 (2d Cir.1960) (L. Hand, J.). As Judge Frankel once observed, "Good eyes and common sense may be as useful as deep study of reported and unreported cases, which themselves are tied to highly particularized facts." Couleur International Ltd. v. Opulent Fabrics, Inc., 330 F.Supp. 152, 153 (S.D.N.Y.1971).

Even at first glance, one can see the striking stylistic relationship between the posters, and since style is one ingredient of "expression," this relationship is significant. Defendants' illustration was executed in the sketchy, whimsical style that has become one of Steinberg's hallmarks. Both illustrations represent a bird's eye view across the edge of Manhattan and a river bordering New York City to the world beyond. Both depict approximately four city blocks in detail and become increasingly minimalist as the design recedes into the background. Both use the device of a narrow band of blue wash across the top of the poster to represent the sky, and both delineate the horizon with a band of primary red.[3]

The strongest similarity is evident in the rendering of the New York City blocks. Both artists chose a vantage point that looks directly down a wide two-way cross street that intersects two avenues before reaching a river. Despite defendants' protestations, this is not an inevitable way of depicting blocks in a city with a grid-like street system, particularly since most New York City cross streets are one-way. Since even a photograph may be copyrighted because "no photograph, however simple, can be unaffected by the personal influence of the author," Time Inc. v. Bernard Geis Assoc., 293 F.Supp. 130, 141 (S.D.N.Y. 1968), quoting Bleistein, supra, one can hardly gainsay the right of an artist to protect his choice of perspective and layout in a drawing, especially in conjunction with the overall concept and individual details. Indeed, the fact that defendants changed the names of the streets while retaining the same graphic depiction weakens their case: had they intended their illustration realistically to depict the streets labeled on the poster, their four city blocks would not so closely resemble plaintiff's four city blocks. Moreover, their argument that they intended the jumble of streets and landmarks and buildings to symbolize their Muscovite protagonist's confusion in a new city does not detract from the strong similarity between their poster and Steinberg's.

[713] While not all of the details are identical, many of them could be mistaken for one another; for example, the depiction of the water towers, and the cars, and the red sign above a parking lot, and even many of the individual buildings. The shapes, windows, and configurations of various edifices are substantially similar. The ornaments, facades and details of Steinberg's buildings appear in defendants', although occasionally at other locations. In this context, it is significant that Steinberg did not depict any buildings actually erected in New York; rather, he was inspired by the general appearance of the structures on the West Side of Manhattan to create his own New York-ish structures. Thus, the similarity between the buildings depicted in the "Moscow" and Steinberg posters cannot be explained by an assertion that the artists happened to choose the same buildings to draw. The close similarity can be explained only by the defendants' artist having copied the plaintiff's work. Similarly, the locations and size, the errors and anomalies of Steinberg's shadows and streetlight, are meticulously imitated.

In addition, the Columbia artist's use of the childlike, spiky block print that has become one of Steinberg's hallmarks to letter the names of the streets in the "Moscow" poster can be explained only as copying. There is no inherent justification for using this style of lettering to label New York City streets as it is associated with New York only through Steinberg's poster.

While defendants' poster shows the city of Moscow on the horizon in far greater detail than anything is depicted in the background of plaintiff's illustration, this fact alone cannot alter the conclusion. "Substantial similarity" does not require identity, and "duplication or near identity is not necessary to establish infringement." Krofft, 562 F.2d at 1167. Neither the depiction of Moscow, nor the eastward perspective, nor the presence of randomly scattered New York City landmarks in defendants' poster suffices to eliminate the substantial similarity between the posters. As Judge Learned Hand wrote, "no plagiarist can excuse the wrong by showing how much of his work he did not pirate." Sheldon v. Metro-Goldwyn Pictures Corp., 81 F.2d 49, 56 (2d Cir.), cert. denied, 298 U.S. 669, 56 S.Ct. 835, 80 L.Ed. 1392 (1936).

Defendants argue that their poster could not infringe plaintiff's copyright because only a small proportion of its design could possibly be considered similar. This argument is both factually and legally without merit. "[A] copyright infringement may occur by reason of a substantial similarity that involves only a small portion of each work." Burroughs v. Metro-Goldwyn-Mayer, Inc., 683 F.2d 610, 624 n. 14 (2d Cir.1982). Moreover, this case involves the entire protected work and an iconographically, as well as proportionately, significant portion of the allegedly infringing work. Cf. Mattel, Inc. v. Azrak-Hamway Intern., Inc., 724 F.2d 357, 360 (2d Cir.1983); Elsmere Music, Inc. v. National Broadcasting Co., 482 F.Supp. 741, 744 (S.D.N.Y.), aff'd, 623 F.2d 252 (2d Cir. 1980) (taking small part of protected work can violate copyright).

The process by which defendants' poster was created also undermines this argument. The "map," that is, the portion about which plaintiff is complaining, was designed separately from the rest of the poster. The likenesses of the three main characters, which were copied from a photograph, and the blocks of text were superimposed on the completed map. Nelson Deposition at 21-22; Nolan Deposition at 28.

I also reject defendants' argument that any similarities between the works are unprotectible scenes a faire, or "incidents, characters or settings which, as a practical matter, are indispensable or standard in the treatment of a given topic." Walker, 615 F.Supp. at 436. See also Reyher, 533 F.2d at 92. It is undeniable that a drawing of New York City blocks could be expected to include buildings, pedestrians, vehicles, lampposts and water towers. Plaintiff, however, does not complain of defendants' mere use of these elements in their poster; rather, his complaint is that defendants [714] copied his expression of those elements of a street scene.

While evidence of independent creation by the defendants would rebut plaintiff's prima facie case, "the absence of any countervailing evidence of creation independent of the copyrighted source may well render clearly erroneous a finding that there was not copying." Roth Greeting Cards v. United Card Co., 429 F.2d 1106, 1110 (9th Cir.1970). See also Novelty Textile Mills, 558 F.2d at 1092 n. 2.

Moreover, it is generally recognized that "... since a very high degree of similarity is required in order to dispense with proof of access, it must logically follow that where proof of access is offered, the required degree of similarity may be somewhat less than would be necessary in the absence of such proof." 2 Nimmer § 143.4 at 634, quoted in Krofft, 562 F.2d at 1172. As defendants have conceded access to plaintiff's copyrighted illustration, a somewhat lesser degree of similarity suffices to establish a copyright infringement than might otherwise be required. Here, however, the demonstrable similarities are such that proof of access, although in fact conceded, is almost unnecessary.

IV

I find meritless defendants' assertion that, to the extent that the "Moscow" poster evokes Steinberg's, that evocation is justified under the parody branch of the "fair use" doctrine, codified at 17 U.S.C. § 107. As this circuit has held, the copyrighted work must be "at least in part an object of the parody," MCA, Inc. v. Wilson, 677 F.2d 180, 185 (2d Cir.1981). The record does not support a claim that defendants intended to satirize plaintiff's illustration; indeed, the deposition testimony of Columbia's executive art director tends to contradict such a claim. Moreover, an assertion that defendants consciously parodied the idea of a parochial view of the world is immaterial: ideas are not protected by copyright, and the infringement alleged is of Steinberg's particular expression of that idea. Defendants' variation on the visual joke of plaintiff's illustration does not, without an element of humor aimed at some aspect of the illustration itself, render it a parody and therefore a fair use of plaintiff's work.

In codifying the case law on determining whether one work constitutes a fair use of another, Congress instructed the courts to consider certain factors, the first of which is whether the intended use of the allegedly infringing work is "of a commercial nature or is for nonprofit educational purposes." 17 U.S.C. § 107(1). As the Second Circuit said in a different artistic context, "We are not prepared to hold that a commercial [artist] can plagiarize a ... copyrighted [work], substitute [certain elements] of his own, [produce] it for commercial gain, and then escape liability by calling the end result a parody or satire on the mores of society." MCA, Inc., 677 F.2d at 185.

In analyzing the commercial or noncommercial nature of the "Moscow" poster, it is useful to distinguish between two conceptually different situations: advertising material that promotes a parody of a copyrighted work, and advertising material that itself infringes a copyright. In the first case, the fact that the advertisement uses elements of the copyrighted work does not necessarily mean that it infringes the copyright, if the product that it advertises constitutes a fair use of the copyrighted work. See, e.g., Warner Bros., 720 F.2d at 242-44 (promotional broadcasts for television series legally parodying the Superman comic strip character did not infringe copyright in Superman character).

In the second case, the work being advertised bears no relationship to the copyrighted work, but the advertisement itself infringes the copyright. In such a case, the owners of the copyright can prevent the advertisement from being used. As the Second Circuit has said, "[n]o matter how well known a copyrighted phrase becomes, its author is entitled to guard against its appropriation to promote the sale of commercial products." Warner Bros., 720 F.2d at 242. See, e.g., D.C. Comics, Inc. v. Crazy Eddie, Inc., 205 [715] U.S.P.Q. 1177 (S.D.N.Y.1979) (discount electronics chain not permitted to advertise its stores using parody of well-known lines associated with copyrighted Superman character).

This situation fits the second case. Neither the "Moscow" movie nor the poster was designed to be a parody of the Steinberg illustration. The poster merely borrowed numerous elements from Steinberg to create an appealing advertisement to promote an unrelated commercial product, the movie. No parody of the illustration is involved, and defendants are not entitled to the protection of the parody branch of the fair use doctrine.

The other factors mandated by 17 U.S.C. § 107 do nothing to mitigate this determination. The copyrighted work at issue is an artistic creation, 17 U.S.C. § 107(2), a very substantial portion of which was appropriated in the defendants' work, 17 U.S.C. § 107(3). As for the value of the copyrighted work, 17 U.S.C. § 107(4), plaintiff submitted testimony to the court to show that his reputation was injured by having the public believe that he voluntarily lent his work to a profit-making enterprise.

V

In their motion, defendants raised the affirmative defenses of estoppel and laches. Although Fed.R.Civ.P. 8(c) generally requires affirmative defenses to be pleaded, courts have been more lenient in the context of motions for summary judgment. "[A]bsent prejudice to the plaintiff, a defendant may raise an affirmative defense in a motion for summary judgment for the first time." Rivera v. Anaya, 726 F.2d 564, 566 (9th Cir.1984). See 2A, 6 J. Moore, Moore's Federal Practice ¶¶ 8.28, 56.02[2], 56.17[4] (2d ed. 1986). It is therefore appropriate for this court to consider these defenses on the merits.

Defendants base their assertions of these equitable defenses on the following factual claims: (1) plaintiff's alleged "deliberate inaction" for eight years in the face of numerous counterfeits of his poster and adaptations of his idea to various other localities; (2) plaintiff's alleged failure to act in response to the newspaper advertisements that appeared to promote "Moscow"; and (3) defendants' assertion that Steinberg waited six months before even complaining to Columbia about their alleged infringement of his copyright on the poster, which defendants claim in their brief was a tactic on plaintiff's part to maximize the damages he hoped to receive.

The record, however, does not support defendants' claims. First, Steinberg specifically requested that The New Yorker magazine attempt to identify the sources of the counterfeit posters and prevent their continued distribution. As for the so-called adaptations of Steinberg's idea, there is no evidence that they infringed his copyright or that anyone ever believed that they did. As plaintiff freely and necessarily admits, the law does not protect an idea, but only the specific expression of that idea. The examples that defendants use to support their defense can at most be considered derivative of Steinberg's idea; none is a close copy of the poster itself, as defendants' is. Finally, defendants' last two assertions are rebutted by evidence that The New Yorker protested to The New York Times on plaintiff's behalf and at his request when "Moscow" opened, and that Columbia learned of this protest only a few weeks later.

Moreover, even were defendants' factual assertions borne out by the record, their equitable defenses would have to be rejected because they have failed to establish the elements of either estoppel or laches.

"A party seeking to invoke the doctrine of estoppel must plead and prove each of the essential elements: (1) a representation of fact ...; (2) rightful reliance thereon; and (3) injury or damage ... resulting from denial by the party making the representation." Galvez v. Local 804 Welfare Trust Fund, 543 F.Supp. 316, 317 (E.D.N. Y.1982), citing Haeberle v. Board of Trustees, 624 F.2d 1132 (2d Cir.1980).

Defendants have not established even the first of these elements. They argue that plaintiff's alleged silence [716] during the course of their advertisement campaign constitutes a sufficient representation of his acquiescence to meet the first requirement of the doctrine. As noted above, however, plaintiff did not remain silent, and the record shows that defendants, despite their awareness of his objections, continued to promote the film with the same advertisements and subsequently released a videocassette version of "Moscow" using the same promotional design. See Lottie Joplin Thomas Trust v. Crown Publishers, 592 F.2d 651, 655 (2d Cir.1978) (defense of estoppel falls where defendants fail to produce any evidence of detrimental reliance on plaintiff's alleged representations). Defendants overlook, moreover, that silence or inaction, in the absence of any duty or relationship between the parties, cannot give rise to an estoppel. Whiting Corp. v. Home Ins. Co., 516 F.Supp. 643, 656 (S.D.N.Y.1981). Cf. Columbia Broadcasting System, Inc. v. Stokely-Van Camp, Inc., 522 F.2d 369, 378 (2d Cir.1975). No such duty existed here.

Defendants have likewise failed to establish the defense of laches. The party asserting laches must show that the opposing party "did not assert her or their rights diligently, and that such asserted lack of diligence ... resulted in prejudice to them." Lottie Joplin, 592 F.2d at 655, citing, inter alia, Costello v. United States, 365 U.S. 265, 282, 81 S.Ct. 534, 543, 5 L.Ed.2d 551 (1961). In Lottie Joplin, the Second Circuit held that a gap of approximately half a year between the publication of the allegedly infringing work and the institution of the lawsuit did not constitute a delay sufficient to establish a claim of laches. In this case, defendants were informed within weeks of plaintiff's disapproval of their poster; moreover, they have presented no evidence that, even if they had acknowledged any awareness of plaintiff's reaction, they would in any way have modified their subsequent actions. Consequently, they have failed to prove prejudice to themselves.

VI

For the reasons set out above, summary judgment is granted to plaintiffs as to copying.

A pretrial conference will be held on September 11, 1987, at 2 o'clock P.M., in Courtroom 35, to determine the proper measure and allocation of damages, other appropriate matters, and the parties' proposed schedule of further proceedings. The parties are to confer in advance of this conference, with the goal of reaching agreement on these matters, if possible.

[1] Nolan claimed also to have been inspired by some of the posters that were inspired by Steinberg's; such secondary inspiration, however, is irrelevant to whether or not the "Moscow" poster infringes plaintiff's copyright by having impermissibly copied it.

[2] The typeface is not a subject of copyright, but the similarity reinforces the impression that defendants copied plaintiff's illustration.

[3] Defendants claim that since this use of thin bands of primary colors is a traditional Japanese technique, their adoption of it cannot infringe Steinberg's copyright. This argument ignores the principle that while "[o]thers are free to copy the original ... [t]hey are not free to copy the copy." Bleistein v. Donaldson Lithographing Co., 188 U.S. 239, 250, 23 S.Ct. 298, 300, 47 L.Ed. 460 (1903) (Holmes, J.). Cf. Dave Grossman Designs, Inc. v. Bortin, 347 F.Supp. 1150, 1156-57 (N.D.Ill.1972) (an artist may use the same subject and style as another "so long as the second artist does not substantially copy [the first artist's] specific expression of his idea.")

14.3 Schrock v. Learning Curve International, Inc. 14.3 Schrock v. Learning Curve International, Inc.

14 (11)

Daniel P. SCHROCK, d/b/a Dan Schrock Photography, Plaintiff-Appellant, v. LEARNING CURVE INTERNATIONAL, INC., RC2 Brands, Inc., and Hit Entertainment, Defendants-Appellees.

No. 08-1296.

United States Court of Appeals, Seventh Circuit.

Argued Sept. 9, 2008.

Decided Nov. 5, 2009.

*515Mark H. Barinholtz (argued), Melinda H. Schramm, Mark H. Barinholtz, P.C., Chicago, IL, for Plaintiff-Appellant.

David G. Hanson (argued), Reinhart, Boerner, Van Deuren, Milwaukee, WI; Matthew T. Furton (argued), Locke Lord Bissell & Liddell, LLP, Chicago, IL, for Defendants-Appellees.

Before FLAUM, WILLIAMS, and SYKES, Circuit Judges.

SYKES, Circuit Judge.

HIT Entertainment (“HIT”) owns the copyright to the popular “Thomas & Friends” train characters, and it licensed Learning Curve International (“Learning Curve”) to make toy figures of its characters. Learning Curve in turn hired Daniel Schrock, a professional photographer, to take pictures of the toys for promotional materials. Learning Curve used Schrock’s services on a regular basis for about four years and thereafter continued to use some of his photographs in its advertising and on product packaging. After Learning Curve stopped giving him work, Schrock registered his photos for copyright protection and sued Learning Curve and HIT for infringement.

The district court granted summary judgment for the defendants, holding that Schrock has no copyright in the photos. The court classified the photos as “derivative works” under the Copyright Act— derivative, that is, of the “Thomas & Friends” characters, for which HIT owns the copyright — and held that Schrock needed permission from Learning Curve (HIT’s licensee) not only to make the photographs but also to copyright them. Because Schrock had permission to make but not permission to copyright the photos, the court dismissed his claim for copyright infringement.

We reverse. We assume for purposes of this decision that the district court correctly classified Schrock’s photographs as derivative works. It does not follow, however, that Schrock needed authorization from Learning Curve to copyright the photos. As long as he was authorized to make the photos (he was), he owned the copyright in the photos to the extent of their incremental original expression. In requiring permission to make and permission to copyright the photos, the district court relied on language in Gracen v. Bradford Exchange, 698 F.2d 300 (7th Cir.1983), suggesting that both are required for copyright in a derivative work. We have more recently explained, however, that copyright in a derivative work arises by operation of law — not through authority from the owner of the copyright in the underlying work — although the parties may alter *516this default rule by agreement. See Liu v. Price Waterhouse LLP, 302 F.3d 749, 755 (7th Cir.2002). Schrock created the photos with permission and therefore owned the copyright to the photos provided they satisfied the other requirements for copyright and the parties did not contract around the default rule.

We also take this opportunity to clarify another aspect of Gracen that is prone to misapplication. Gracen said that “a derivative work must be substantially different from the underlying work to be copyrightable.” 698 F.2d at 305. This statement should not be understood to require a heightened standard of originality for copyright in a derivative work. We have more recently explained that “the only ‘originality’ required for [a] new work to be copyrightable ... is enough expressive variation from public-domain or other existing works to enable the new work to be readily distinguished from its predecessors.” Bucklew v. Hawkins, Ash, Baptie & Co., LLP, 329 F.3d 923, 929 (7th Cir.2003). Here, Schrock’s photos of Learning Curve’s “Thomas & Friends” toys possessed sufficient incremental original expression to qualify for copyright.

But the record doesn’t tell us enough about the agreements between the parties for us to determine whether they agreed to alter the default rule regarding copyright or whether Learning Curve had an implied license to continue to use Schrock’s photos. Whether Schrock could copyright his photographs and maintain an infringement action against the defendants depends on the contractual understandings between Schrock, Learning Curve, and HIT. Accordingly, we remand to the district court for further proceedings consistent with this opinion.

I. Background

HIT is the owner of the copyright in the “Thomas & Friends” properties, and Learning Curve1 is a producer and distributor of children’s toys. HIT and Learning Curve entered into a licensing agreement granting Learning Curve a license to create and market toys based on HIT’s characters. HIT and Learning Curve maintain (through an affidavit of HIT’s vice-president of licensing) that HIT retained all intellectual-property rights in the works produced under the license. The licensing agreement, however, is not in the record.

In 1999 Learning Curve retained Daniel Schrock to take product photographs of its toys, including those based on HIT’s characters, for use in promotional materials. On numerous occasions during the next four years, Schrock photographed several lines of Learning Curve’s toys, including many of the “Thomas & Friends” toy trains, related figures, and train-set accessories. (We have attached two of the photos as examples, although they are extremely poor copies because the originals are in color.) Schrock invoiced Learning Curve for this work, and some of the invoices included “usage restrictions” purporting to limit Learning Curve’s use of his photographs to two years. Learning Curve paid the invoices in full — in total more than $400,000.

Learning Curve stopped using Schrock’s photography services in mid-2003 but continued to use some of his photos in its printed advertising, on packaging, and on the internet. In 2004 Schrock registered his photos for copyright protection and sued HIT and Learning Curve for infringement; he also alleged several state-law claims. HIT and Learning Curve moved for summary judgment, arguing *517primarily that Schrock’s photos were derivative works and not sufficiently original to claim copyright protection, and that neither HIT nor Learning Curve ever authorized Schrock to copyright the photos. They argued in the alternative that Schrock granted them an unlimited oral license to use the photos.

The district court granted summary judgment for the defendants. The judge began by noting the long tradition of recognizing copyright protection in photographs but said he would nonetheless “eschew” the question whether Schrock’s photographs were sufficiently original to copyright. The judge focused instead on whether the photos were derivative works under the Copyright Act and concluded that they were. Then, following language in Gracen, the judge held that Learning Curve’s permission to make the photos was not enough to trigger Schrock’s copyright in them; the judge said Schrock must also have Learning Curve’s permission to copyright the photos. Schrock did not have that permission, so the judge concluded that Schrock had no copyright in the photos and dismissed his claim for copyright infringement.2 Schrock appealed.

II. Discussion

Schrock argues that the district judge mistakenly classified his photos as derivative works and misread or misapplied Gracen. He contends that his photos are not derivative works, and even if they are, his copyright is valid and enforceable because he had permission from Learning Curve to photograph the underlying copyrighted works and his photos contained sufficient incremental original expression to qualify for copyright. HIT and Learning Curve defend the district court’s determination that the photos are derivative works and argue that the court properly read Gracen to require permission to copyright as well as permission to make the derivative works. Alternatively, they maintain that Schrock’s photographs contain insufficient originality to be copyrightable and that copyright protection is barred under the scenes a faire or merger doctrines. Finally, the defendants ask us to affirm on the independent ground that Schrock orally granted them an unlimited license to use his works.

As a general matter, a plaintiff asserting copyright infringement must prove: “(1) ownership of a valid copyright, and (2) copying of constituent elements of the work that are original.” Feist Publ’ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 361, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991). There is no dispute here about copying; Learning Curve used Schrock’s photos in its promotional materials. The focus instead is on the validity of Schrock’s asserted copyright in the photos. The Copyright Act provides that “[cjopyright protection subsists ... in original works of authorship fixed in any tangible medium of expression ... from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device.” 17 U.S.C. § 102(a). In this circuit, copyrightability is an issue of law for the court. Gaiman v. McFarlane, 360 F.3d 644, 648-49 (7th Cir.2004).

Much of the briefing on appeal — and most of the district court’s analysis — concerned the classification of the photos as derivative works. A “derivative work” is:

*518[A] work based upon one or more preexisting works, such as a translation, musical arrangement, dramatization, fictionalization, motion picture version, sound recording, art reproduction, abridgment, condensation, or any other form in which a work may be recast, transformed, or adapted. A work consisting of editorial revisions, annotations, elaborations, or other modifications which, as a whole, represent an original work of authorship, is a “derivative work”.

17 U.S.C. § 101. The Copyright Act specifically grants the author of a derivative work copyright protection in the incremental original expression he contributes as long as the derivative work does not infringe the underlying work. See id. § 103(a), (b); see also Pickett v. Prince, 207 F.3d 402, 405 (7th Cir.2000); Lee v. A.R.T. Co., 125 F.3d 580, 582 (7th Cir.1997). The copyright in a derivative work, however, “extends only to the material contributed by the author of such work, as distinguished from the preexisting material employed in the work.” 17 U.S.C. § 103(b).

A. Photographs as Derivative Works

Whether photographs of a copyrighted work are derivative works is the subject of deep disagreement among courts and commentators alike. See 1 Melville B. Nimmer & David Nimmer, Nimmer on Copyright § 3.03[C][1], at 3-20.3 (Aug.2009). The district court held that Schrock’s photos came within the definition of derivative works because they “recast, transformed, or adapted” the three-dimensional toys into a different, two-dimensional medium. For this conclusion the judge relied in part on language in Gracen and in the Ninth Circuit’s decision in Ets-Hokin v. Skyy Spirits, Inc., 225 F.3d 1068 (9th Cir.2000), recognizing, however, that neither decision directly decided the matter. Gracen did not involve photographs at all, and although Ets-Hokin did, the Ninth Circuit ultimately sidestepped the derivative-works question and rested its decision on other grounds. Id. at 1081.

The judge also cited other decisions in this circuit that appear to support the conclusion that photographs are derivative works, but these, too (and again, as the judge properly acknowledged), did not directly address the question. Ty, Inc. v. Publications International Ltd., 292 F.3d 512, 519 (7th Cir.2002), involved unauthorized “Beanie Babies” collector’s guides that incorporated photographs of the popular beanbag plush toys into the text. We said there that “photographs of Beanie Babies are derivative works from the copyrighted Beanie Babies themselves,” but this statement was based entirely on the parties’ concession that the photographs were derivative works. Id. Saturday Evening Post Co. v. Rumbleseat Press, Inc., 816 F.2d 1191 (7th Cir.1987), made a passing remark suggesting that photographs of Norman Rockwell illustrations were derivative works, but that was not an issue in the case, id. at 1201; the issue instead was whether certain terms in a licensing agreement (specifically, no-contest and arbitration clauses) were enforceable, id. at 1193.

We need not resolve the issue definitively here. The classification of Schrock’s photos as derivative works does not affect the applicable legal standard for determining copyrightability, although as we have noted, it does determine the scope of copyright protection. Accordingly, we will assume without deciding that each of Schrock’s photos qualifies as a derivative work within the meaning of the Copyright Act.

B. Originality and Derivative Works

As a constitutional and statutory matter, “[t]he sine qua non of copyright is *519originality.” Feist Publ’ns, Inc., 499 U.S. at 345, 111 S.Ct. 1282; see 17 U.S.C. § 102. Originality in this context “means only that the work was independently created by the author ... and that it possesses at least some minimal degree of creativity.” Feist Publ’ns, Inc., 499 U.S. at 345, 111 S.Ct. 1282. The Supreme Court emphasized in Feist that “the requisite level of creativity is extremely low; even a slight amount will suffice.” Id. The Court also explained that “[o]riginality does not signify novelty; a work may be original even though it closely resembles other works.” Id. What is required is “independent creation plus a modicum of creativity.” Id. at 346, 111 S.Ct. 1282.

Federal courts have historically applied a generous standard of originality in evaluating photographic works for copyright protection. See, e.g., Ets-Hokin, 225 F.3d at 1073-77; SHL Imaging, Inc. v. Artisan House, Inc., 117 F.Supp.2d 301, 305 (S.D.N.Y.2000). In some cases, the original expression may be found in the staging and creation of the scene depicted in the photograph. See, e.g., Mannion v. Coors Brewing Co., 377 F.Supp.2d 444, 452 (S.D.N.Y.2005). But in many cases, the photographer does not invent the scene or create the subject matter depicted in it. Rather, the original expression he contributes lies in the rendition of the subject matter — that is, the effect created by the combination of his choices of perspective, angle, lighting, shading, focus, lens, and so on. See id.; Rogers v. Koons, 960 F.2d 301, 307 (2d Cir.1992) (“Elements of originality in a photograph may include posing the subjects, lighting, angle, selection of film and camera, evoking the desired expression, and almost any other variant involved.”). Most photographs contain at least some originality in their rendition, see Mannion, 377 F.Supp.2d at 452 (“Unless a photograph replicates another work with total or near-total fidelity, it will be at least somewhat original in the rendition.”), except perhaps for a very limited class of photographs that can be characterized as “slavish copies” of an underlying work, Bridgeman Art Library, Ltd. v. Corel Corp., 25 F.Supp.2d 421, 427 (S.D.N.Y.1998) (finding no originality in transparencies of paintings where the goal was to reproduce those works exactly and thus to minimize or eliminate any individual expression).

Our review of Schrock’s photographs convinces us that they do not fall into the narrow category of photographs that can be classified as “slavish copies,” lacking any independently created expression. To be sure, the photographs are accurate depictions of the three-dimensional “Thomas & Friends” toys, but Schrock’s artistic and technical choices combine to create a two-dimensional image that is subtly but nonetheless sufficiently his own.3 This is confirmed by Schrock’s deposition testimony describing his creative process in depicting the toys. Schrock explained how he used various camera and lighting techniques to make the toys look more “life like,” “personable,” and “friendly.” He explained how he tried to give the toys “a little bit of dimension” and that it was his goal to make the toys “a little bit better than what they look like when you actually see them on the shelf.” The original expression in the representative sam*520pie is not particularly great (it was not meant to be), but it is enough under the applicable standard to warrant the limited copyright protection accorded derivative works under § 103(b).

Aside from arguing that the works fail under the generally accepted test for originality, Learning Curve and HIT offer two additional reasons why we should conclude that Schrock’s photographs are not original. First, they claim that the photos are intended to serve the “purely utilitarian function” of identifying products for consumers. The purpose of the photographs, however, is irrelevant. See Bleistein v. Donaldson Lithographing Co., 188 U.S. 239, 251-52, 23 S.Ct. 298, 47 L.Ed. 460 (1903); SHL Imaging, Inc., 117 F.Supp.2d at 311 (“That the photographs were intended solely for commercial use has no bearing on their protectibility.”).

The defendants’ second and more substantial argument is that it is not enough that Schrock’s photographs might pass the ordinary test for originality; they claim that as derivative works, the photos are subject to a higher standard of originality. A leading copyright commentator disagrees. The Nimmer treatise maintains that the quantum of originality required for copyright in a derivative work is the same as that required for copyright in any other work. See 1 Nimmer on Copyright § 3.01, at 3-2, § 3.03[A], at 3-7. More particularly, Nimmer says the relevant standard is whether a derivative work contains a “nontrivial” variation from the preexisting work “sufficient to render the derivative work distinguishable from [the] prior work in any meaningful manner.” Id. § 3.03[A], at 3-10. The caselaw generally follows this formulation. See, e.g., Eden Toys, Inc. v. Floretee Undergarment Co., 697 F.2d 27, 34-35 (2d Cir.1982) (holding that numerous minor changes in an illustration of Paddington Bear were sufficiently nontrivial because they combined to give Paddington a “different, cleaner ‘look’ ”); Millworth Converting Corp. v. Slifka, 276 F.2d 443, 445 (2d Cir.1960) (holding that embroidered reproduction of a public-domain embroidery of Peter Pan was sufficiently distinguishable because the latter gave a “three-dimensional look” to the former embroidery).

Learning Curve and HIT argue that our decision in Gracen established a more demanding standard of originality for derivative works. Gracen involved an artistic competition in which artists were invited to submit paintings of the character Dorothy from the Metro-Goldwyn-Mayer (“MGM”) movie The Wizard of Oz. Participating artists were given a still photograph of Dorothy from the film as an exemplar, and the paintings were solicited and submitted with the understanding that the best painting would be chosen for a series of collector’s plates. Gracen, 698 F.2d at 301. Plaintiff Gracen prevailed in the competition, but she refused to sign the contract allowing her painting to be used in the collector’s plates. The competition sponsor commissioned another artist to create a similar plate, and Gracen sued the sponsor, MGM, and the artist for copyright infringement. We held that Gracen could not maintain her infringement suit because her painting, a derivative work, was not “substantially different from the underlying work to be copyrightable.” Id. at 305.

. Gracen drew this language from an influential Second Circuit decision, L. Batlin & Son, Inc. v. Snyder, 536 F.2d 486 (2d Cir.1976). Read in context, however, the cited language from L. Batlin did not suggest that a heightened standard of originality applies to derivative works.4 To the *521contrary, the Second Circuit said only that to be copyrightable a work must “ ‘contain some substantial, not merely trivial originality.’ ” Id. at 490 (quoting Chamberlin v. Uris Sales Corp., 150 F.2d 512, 513 (2d Cir.1945)). The court explained that for derivative works, as for any other work, “[t]he test of originality is concededly one with a low threshold in that all that is needed is that the author contributed something more than a merely trivial variation, something recognizably his own.” Id. (internal quotation marks and ellipsis omitted).

The concern expressed in Gracen was that a derivative work could be so similar in appearance to the underlying work that in a subsequent infringement suit brought by a derivative author, it would be difficult to separate the original elements of expression in the derivative and underlying works in order to determine whether one derivative work infringed another. The opinion offered the example of artists A and B who both painted their versions of the Mona Lisa, a painting in the public domain. See Gracen, 698 F.2d at 304. “[I]f the difference between the original and A’s reproduction is slight, the difference between A’s and B’s reproductions will also be slight, so that if B had access to A’s reproductions the trier of fact will be hard-pressed to decide whether B was copying A or copying the Mona Lisa itself.” Id.

No doubt this concern is valid. But nothing in the Copyright Act suggests that derivative works are subject to a more exacting originality requirement than other works of authorship. Indeed, we have explained since Gracen that “the only ‘originality’ required for [a] new work to by copyrightable ... is enough expressive variation from public-domain or other existing works to enable the new work to be readily distinguished from its predecessors.” Bucklew, 329 F.3d at 929. We emphasized in Bucklew that this standard does not require a “high degree of [incremental] originality.” Id.

We think Gracen must be read in light of L. Batlin, on which it relied, and Bucklew, which followed it. And doing so reveals the following general principles: (1) the originality requirement for derivative works is not more demanding than the originality requirement for other works; and (2) the key inquiry is whether there is sufficient nontrivial expressive variation in the derivative work to make it distinguishable from the underlying work in some meaningful way. This focus on the presence of nontrivial “distinguishable variation” adequately captures the concerns articulated in Gracen without unduly narrowing the copyrightability of derivative works. It is worth repeating that the copyright in a derivative work is thin, extending only to the incremental original expression contributed by the author of the derivative work. See 17 U.S.C. § 103(b).

As applied to photographs, we have already explained that the original expres*522sion in a photograph generally subsists in its rendition of the subject matter. If the photographer’s rendition of a copyrighted work varies enough from the underlying work to enable the photograph to be distinguished from the underlying work (aside from the obvious shift from three dimensions to two, see supra n.3), then the photograph contains sufficient incremental originality to qualify for copyright. Schrock’s photos of the “Thomas & Friends” toys are highly accurate product photos but contain minimally sufficient variation in angle, perspective, lighting, and dimension to be distinguishable from the underlying works; they are not “slavish copies.” Accordingly, the photos qualify for the limited derivative-work copyright provided by § 103(b).5 See SHL Imaging, 117 F.Supp.2d at 311 (holding that copyright protection in product-accurate photographs was “thin”); see also Rockford Map Publishers, Inc. v. Directory Serv. Co. of Colo., Inc., 768 F.2d 145, 148 (7th Cir.1985) (“Perhaps the smaller the effort the smaller the contribution; if so, the copyright simply bestows fewer rights.”). However narrow that copyright might be, it at least protects against the kind of outright copying that occurred here.

C. Authorization and Derivative Works

To be copyrightable, a derivative work must not be infringing. See 17 U.S.C. § 103(a); see also Pickett, 207 F.3d at 405-06; Gracen, 698 F.2d at 302. The owner of the copyright in the underlying work has the exclusive right to “prepare derivative works based upon the copy*523righted work,” 17 U.S.C. § 106(2), and “it is a copyright infringement to make or sell a derivative work without a license from the owner of the copyright on the work from which the derivative work is derived,” Bucklew, 329 F.3d at 930. This means the author of a derivative work must have permission to make the work from the owner of the copyright in the underlying work; Gracen suggested, however, that the author of a derivative work must also have permission to copyright it. 698 F.2d at 303-04 (“[T]he question is not whether Miss Gracen was licensed to make a derivative work but whether she was also licensed to exhibit [her] painting and to copyright it.... Even if [Gracen] was authorized to exhibit her derivative works, she may not have been authorized to copyright them.”). The district court relied on this language from Gracen to conclude that Schrock has no copyright in his photos because he was not authorized by Learning Curve to copyright them. This was error.

First, Gracen’s language presupposing a permission-to-copyright requirement was dicta; the case was actually decided on nonoriginality grounds. Id. at 305. More importantly, the dicta was mistaken; there is nothing in the Copyright Act requiring the author of a derivative work to obtain permission to copyright his work from the owner of the copyright in the underlying work. To the contrary, the Act provides that copyright in a derivative work, like copyright in any other work, arises by operation of law once the author’s original expression is fixed in a tangible medium. “Copyright protection subsists ... in original works of authorship fixed in any tangible medium of expression,” 17 U.S.C. § 102(a), and “[t]he subject matter of copyright ... includes ... derivative works,” id. § 103(a). “Copyright in a work protected under this title vests initially in the author or authors of the work.”6 Id. § 201(a); see also Schiller & Schmidt, Inc. v. Nordisco Corp., 969 F.2d 410, 413 (7th Cir.1992) (“The creator of the [intellectual] property is the owner.... ”). While the author of an original work “may obtain a certifícate of copyright, which is ‘prima facie evidence’ of its validity,” JCW Invs., Inc. v. Novelty, Inc., 482 F.3d 910, 915 (7th Cir.2007), “copyright protection begins at the moment of creation of ‘original works of authorship,’ ” id. at 914. This principle applies with equal force to derivative works.

The leading treatise on copyright law confirms this basic understanding. “[T]he right to claim copyright in a noninfringing derivative work arises by operation of law, not through authority from the copyright owner of the underlying work.”6 7 1 Nimmer on Copyright § 3.06, at 3-34.34. We have cited Nimmer with approval on this point. See Liu, 302 F.3d at 755. As we noted in Liu, however, there is an impor*524tant proviso explained in the treatise: “[I]f the pertinent agreement between the parties affirmatively bars the licensee from obtaining copyright protection even in a licensed derivative work, that contractual provision would appear to govern.” 1 Nimmer on Copyright § 3.06, at 3-34.34; see also Liu, 302 F.3d at 755.

On this point Liu is instructive. Price Waterhouse LLP owned the copyright to a computer-software program, and Yang, an employee, was asked to help recruit a Chinese computer programmer to increase the speed of the program. Liu, 302 F.3d at 751. Yang became concerned that if the Chinese programmer was successful, Price Waterhouse might exclude her from future Chinese ventures. To allay these concerns, Price Waterhouse entered into a series of letter agreements with Yang specifying a payment schedule for benchmark improvements in the program and promising to appoint her to head additional projects in China if she and the Chinese programmer met the benchmarks. The agreements also provided, however, that Price Waterhouse would own the intellectual-property rights to the improved software. Id. at 751-52. The Chinese programmer achieved the desired increase in speed, but a dispute arose over Yang’s payment and Yang refused to give Price Waterhouse the source code to the improved software. She then induced the Chinese programmer to assign any copyright in the improved program to Liu, her daughter, and registered the copyright in Liu’s name. Id. at 752.

In the meantime, Price Waterhouse turned to another consultant for assistance in improving its software program. The new consultant successfully increased the speed of the program, and Price Water-house incorporated these improvements into its software. Liu then sued Price Waterhouse for copyright infringement. Price Waterhouse counterclaimed for infringement and filed a third-party complaint against Yang for contributory infringement and various state-law claims sounding in misappropriation. For her part, Yang asserted a breach-of-contract claim against Price Waterhouse for nonpayment on the letter agreements. A jury found for Price Waterhouse on the copyright-infringement claims and for Yang on the breach-of-contract claim. Id. at 753.

We affirmed, explaining that because the owner of a copyrighted work has the exclusive right to control the preparation of derivative works, the owner could limit the derivative-work author’s intellectual-property rights in the contract, license, or agreement that authorized the production of the derivative work. Id. at 755. Citing Nimmer, we noted that although the right to claim copyright in a derivative work arises by operation of law — not by permission of the underlying copyright owner— the parties may alter this general rule by agreement. Id. (“While the Copyright Act makes authors of derivative works the presumptive owners of copyright rights in their contribution, it also allows parties to adjust those rights by contract.” (quotation marks omitted)). We affirmed the jury’s verdict finding that the parties had agreed that Price Waterhouse would own the copyright in any derivative program. Id.

In this case, the evidence submitted with the summary-judgment motion does not establish as a matter of law that the parties adjusted Schrock’s rights by contract; as in Liu, it may be a jury question. We say “may” because further development of the record might resolve the remaining liability questions as a matter of law. It is undisputed that Schrock was authorized to photograph the “Thomas & Friends” toys, and as the creator of the photos, Schrock’s copyright arose by oper*525ation of law.8 We cannot tell, however, whether the parties altered this default rule in their agreements. We note that HIT apparently attempted to do so, at least vis-a-vis Learning Curve; it claims that its licensing agreement with Learning Curve expressly retained the intellectual-property rights in all works that were based upon its copyrights. HIT also claims that the licensing agreement prohibited Learning Curve from granting any third parties copyright protection in derivative works based on HIT’s copyright. As we have noted, however, the licensing agreement is not in the record. Although HIT’s summary-judgment submission included an affidavit of its vice-president of licensing describing the agreement, the best evidence of the terms of an agreement is, of course, the agreement itself. See Fed.R.Evid. 1002.

The terms of the agreement between Learning Curve and Schrock are even less clear. Whether Learning Curve, as HIT’s licensee, contractually limited Schrock’s right to copyright his photos is unknown; its failure to develop the record on this point, however, suggests that it did not. From what we can tell, the agreement between Learning Curve and Schrock appears to consist of a series of oral agreements followed by invoices for completed photography work. If Learning Curve was required under its licensing agreement with HIT to protect HIT’s intellectual-property rights in connection with its retention of Schrock’s photography services, it apparently failed to do so. Learning Curve argues in the alternative that Schrock granted it an unlimited license to use his photos, but on this issue the record is also ambiguous. We leave it to the district court to sort out, consistent with this opinion, whether the evidence requires a trial to determine liability among the parties.

Accordingly, for all the foregoing reasons, we Reverse the judgment of the district court and Remand for further proceedings consistent with this opinion.

*526

14.4 Quality Inns International, Inc. v. McDonald's Corp. 14.4 Quality Inns International, Inc. v. McDonald's Corp.

Trademark

QUALITY INNS INTERNATIONAL, INC. v. McDONALD’S CORPORATION.

Civ. No. PN-87-2606.

United States District Court, D. Maryland.

Sept. 16, 1988.

*201Laurence R. Hefter, Robert D. Litowitz, Griffith Price, and Finnegan, Henderson, Farabow, Garrett & Dunner, Washington, D.C., and Harry M. Rifkin, Semmes, Bowen & Semmes, Baltimore, Md., for plaintiff.

Stephen H. Sachs, Thomas P. Olson, Stephen S. Zimmerman, and Wilmer, Cutler & Pickering, Washington, D.C., and Karen B. Ksander, Isham, Lincoln & Beale, Chicago, 111., for defendant.

OPINION

NIEMEYER, District Judge.

On September 21, 1987, Quality Inns International, Inc. announced a new chain of economy hotels to be marketed under the name “McSleep Inn.” The response of McDonald’s Corporation was immediate. It demanded by letter sent three days later that Quality International not use the name “McSleep” because it infringed on McDonald’s family of marks that are characterized by the use of the prefix “Me” combined with a generic word. Five days later, on September 29, 1987, Quality International filed this action seeking a declaratory judgment that the mark “McSleep Inn” (1) does not infringe McDonald’s federally registered trademarks in violation of 15 U.S.C. § 1114; (2) does not constitute a false designation of origin or a false description or representation of services as being associated with or originating with McDonald’s in violation of 15 U.S.C. § 1125(a); and (3) does not infringe or violate any common law rights that McDonald’s may have to its marks.

McDonald’s filed a counterclaim alleging trademark infringement and unfair competition under the same laws that Quality International invoked in its complaint for a declaratory judgment. In addition, McDonald’s alleges dilution of its marks in violation of the Illinois Anti-Dilution Act, Ill.Rev.Stat. Ch. 140, § 22.

The case came to trial before the Court without a jury on July 18, 1988 and concluded on July 26, 1988. The Court has reviewed all of the evidence received at trial, including the deposition testimony offered. It has studied the memoranda and cases submitted by counsel for the parties. This opinion will serve as the Court’s findings of fact and conclusions of law as prescribed by Fed.R.Civ.P. 52(a).

I. THE ISSUES

The issues are framed by the positions taken by the parties.

McDonald’s alleges a straightforward trademark infringement and unfair competition action. It contends that it is the owner of a family of marks each of which is formulated by combining the prefix “Me” with a generic word to form a fanciful trademark or service mark. It contends that the name “McSleep Inn” that has been adopted by Quality International is likely to cause confusion and that Quality International selected the word “McSleep” deliberately to trade on the goodwill and reputation of McDonald’s. It *202claims attorneys’ fees under 15 U.S.C. § 1117.

Quality International’s defenses may be summarized under four points, as follows:

1) No likelihood of confusion: McDonald’s cannot claim ownership over every formative of “Me” plus a generic word, and the formative “McSleep” is not a name or, when used in its logo form, is not a logo that is likely to cause confusion.

2) Noncompeting uses: McDonald’s

marks have been developed in the fast-food business and do not preclude the use of “McSleep Inn” in the lodging business.

3) Extensive third-party uses: By allowing or acquiescing in the use by third parties of a proliferation of the use of words formulated by combining “Me” with a generic word, McDonald’s should be denied the right to preclude the use of “McSleep Inn.”

4) “Me” is generic: The use of “Me” as a prefix has become generic and has entered into the English language with a recognized meaning of its own.

II. QUALITY INTERNATIONAL

Quality International is a Delaware corporation with its principal offices in Silver Spring, Maryland. It is engaged in the lodging business, particularly in inns, hotels, suites, and resorts. Since 1981 it has been the fastest growing hotel franchise chain in the United States and is now the third largest franchiser of hotels both in terms of hotels and rooms available. Its sales for 1987 were over $56 million.

After Robert C. Hazard, Jr. became the chief executive officer of Quality International in 1980, the company adopted a long range plan that began with an analysis segmenting the lodging market into five sections: economy, luxury budget, mid-priced, luxury, and super luxury. Mr. Hazard then aimed various products of Quality International at these market segments. Clarion Hotels and Resorts became the luxury product of Quality International; Quality Inns, the mid-priced; and Comfort Inns, the luxury budget.

Having no product to compete in the economy segment, Quality International designed a concept for a hotel with a smaller basic room which would rent for between $20 and $29 per night. Each room would have a queen size bed, plush carpeting, color TV, and a contiguous bathroom. There would be no conference rooms, food or other amenities on the premises, except a swimming pool in certain geographical areas. These economy hotels would all be of new construction and a consistent architecture. The name selected by Mr. Hazard for this product was “McSleep Inn.” The first McSleep Inn is scheduled to open in December, 1988.

To improve its marketing of all products, Quality International adopted a “three chain logo” which consists of the three individualized but compatible logos for each of the products offered (Clarion, Quality Inn, and Comfort Inn), arranged horizontally under the caption “Quality International.” Each logo, though different, clearly belongs to a family. The outside shape of all three is square with rounded corners and all three include within the square a stylized sun and the applicable name “Comfort,” “Quality,” or “Clarion.”

This three chain logo will be expanded into a four chain logo when the McSleep Inns join the family of Quality International hotels and motels. As the new corporate signature of Quality International, the four chain logo will be featured in all corporate advertising.

While it is the policy of Quality International to advertise with a consistent corporate identification, at the present time, inns and motels franchised by Quality International advertise their individual facilities without reference to the corporate signature. Moreover, limited access highway signs which announce lodging at exits only depict the logo of the particular motels available at the exit; government regulations do not permit inclusion of the three chain or four chain logo. Examples of telephone directory advertising and even franchising offering materials received at trial did not include the Quality International corporate signature.

*203III. MCDONALD’S CORPORATION

McDonald’s Corporation is a Delaware corporation with its principal offices in Oak Brook, Illinois. Founded by Ray A. Kroc, it opened its first restaurant in April, 1955, in Des Plaines, Illinois. It is now the largest fast food business in the world, with over 10,000 restaurants in 45 countries and over $14 billion in sales annually. In the United States it owns or franchises over 8200 restaurants. McDonald’s restaurants serve over 18 million people daily, and of all the people in the United States who eat out, 11 percent eat dinner and 25 percent eat breakfast at McDonald’s. McDonald’s claims that within the last four weeks, 89 percent of all children between the ages of two and seven and 64 percent of all adults have eaten at a McDonald’s restaurant. Indeed, over 95 percent of the entire American population has eaten at a McDonald’s, and eight percent of the entire work force in the United States once worked at a McDonald’s restaurant.

In mass marketing McDonald’s has widely promoted its business philosophy of “quality, service, cleanliness and value,” or “Q.S.C.V.” It first began network television advertising in 1965, and today 85 percent of its advertising is television advertising, although it also advertises on the radio and in print. In fiscal 1987, it spent over $400 million in media advertising in the United States alone. Its total expenditures for advertising and promotion over the last years have been in excess of six percent of its total sales and approximately $917 million for fiscal 1987. It is the largest single brand advertiser in the United States.

At trial McDonald’s presented diverse examples of its advertising directed at particular groups and designed for particular purposes. Approximately 22 years ago, McDonald’s created the figure of Ronald McDonald, a fictitious clown who presides over McDonaldland. While Ronald McDonald over the years has promoted values consistent with McDonald’s intended image, he has never urged directly that children purchase McDonald’s products. Ronald McDonald is also used extensively in connection with Ronald McDonald Houses, a charitable function supported by McDonald’s.

McDonald’s has achieved an extremely high awareness in the minds of the American public. It claims that when asked to name a fast food restaurant, 90 percent of the public will name McDonald’s. The recognition of Ronald McDonald by children between the ages of two and eight is 100 percent, a figure matched only by Santa Claus.

In 1977, McDonald’s began advertising a fanciful language called “McLanguage” that featured the formulation of words by combining the “Me” prefix with a variety of nouns and adjectives. In television advertising viewed by the Court, Ronald McDonald is shown teaching children how to formulate “Me” words, and he used words such as McService, McPrice, McFries and McBest.

In a consistent vein McDonald’s has coined “Me” words for many of its products and services. McChicken, Chicken McNuggets, Egg McMuffin or Sausage McMuffin, McD.L.T., McHappy Day, McFortune Cookie, McFeast, McCola, McPizza, McSnack are but some of the many. It has obtained trademark registrations for all of these.

McDonald’s marks are not limited to the fast food area, and it has obtained registrations for the use of marks in other areas as well. In the areas of children’s clothing, it owns McKids; in interstate travel plazas, McStop; in job programs, McJobs; in computer software, McClass; in ground shuttle transportation, McShuttle. It calls its own hotel at its home offices in Oak Brook, Illinois, McLodge.

There is no evidence to suggest that anyone prior to McDonald’s used “Me” with a generic word. This is not to say, however, that every use today of “Me” plus a generic word belongs to McDonald’s family of marks, a subject that is discussed further, below.

IV. SELECTION OF THE NAME “McSLEEP”

The trade name for Quality International’s new economy line of hotels, McSleep *204Inn, is the brainchild of its CEO, Robert C. Hazard, Jr. At trial he described how he thought of the name at 2 o’clock one morning in November or December 1986 and jotted down notes of his ideas at bedside. He wanted a name that conveyed thrift and consistency, and from a list of several names that he considered, he selected “McSleep.” He said that the “Me” from the Scottish surname conveyed thrift. The notion of “consistency” was the new generic meaning of the prefix “Me” in the English language. He denied that his selection was an imitation of McDonald’s or that McDonald’s occurred to him at the time that he selected the name McSleep. For the reasons given, the Court does not credit this testimony.

When Mr. Hazard first developed his five-year plan for Quality International, which he issued on January 1, 1983, he identified nine corporations whose values he emulated. One of the nine was McDonald’s, and the values that he attributed to McDonald’s, which he did not attribute to any of the other eight, were “quality, cleanliness and value” (actually McDonald’s corporate philosophy was Q.S.C. V. or quality, service, cleanliness and value). Those are the very values that later became the values of Quality International for its new McSleep Inn product in a slightly different form.

In presenting his idea of McSleep Inns to the Board of Directors of Quality International in June, 1987 for approval, Mr. Hazard described the new product in terms not only suggestive of McDonald’s advertising but openly modeled on the McDonald’s concept:

The marketing promise of McSleep is “a consistent, convenient, quality product at a low price.”
The marketing hook is the name “McSleep;” not McSleep Motor Inn or McSleep Motel — just “McSleep.” The name McSleep should help consumers instantly identify the product for what it is — a consistently clean, quality product at a low price.
$ # >)< * * *
McSleep is aimed at the entire travel market. Like McDonald’s, it is acceptable for the upscale traveler who wants only a good night’s sleep and for the economy traveler who wants to save money.

Yet, when questioned at trial whether the promise of a consistent, convenient and quality product at a low price brought to mind McDonald’s, Mr. Hazard said it never occurred to him, though it was possible “it might remind some folks of McDonald’s.” He added, however, “it didn’t remind me of McDonald’s.”

Around the time that the McSleep concept was being presented to the Board, an early draft of the franchise brochure describing a McSleep Inn referred to the name as “instantly recognizable.” This characterization was considered “wrong” by a number of management of Quality International and was deleted from the final published version. Nevertheless, the draft evidenced a perception at Quality International at that time that the McSleep Inn would enjoy instant recognition, much as Mr. Hazard had promised to his Board when he said, “the name McSleep should help consumers instantly identify the product.”

In addition to his overtly expressed admiration for McDonald’s and its method of doing business, which appears to be the same course that Mr. Hazard pursued for Quality International, the possibility of actually working with McDonald’s in a joint venture involving an inexpensive, quality hotel with a fast-food restaurant was on the Quality International agenda at the time Mr. Hazard selected “McSleep.”

Years before, McDonald’s had adopted and used the name McStop in connection with a traveler’s plaza for the long distance traveler. The plaza by concept included a McDonald’s fast-food restaurant, a convenience store, gas station, lodging, and related businesses. While McDonald’s would only own the restaurant, it would supervise the development and quality of the entire plaza and thus call it “McStop.”

In the summer of 1986, Mr. James H. Nelms, a regional manager of Quality In*205ternational, had been pursuing various discussions with McDonald’s and Kroh Brothers, a real estate developer, for possible participation in McStop plazas. Prior to a trade show in September of 1986, Mr. Nelms had numerous conversations to this end, and at the trade show he introduced the McDonald’s representatives to Mr. Hazard. Following that brief meeting, a representative of Kroh Brothers wrote to Mr. Hazard:

As you recall, Kroh Brothers Development Company is working with McDonald’s on the McStop concept. I have enclosed a flier that provides you with more information about what a McStop should be.

This letter was received by Mr. Hazard on October 2, 1986, and he referred it to Mr. Frederick W. Mosser, Quality International’s vice president in charge of franchising.

Quality International and McDonald’s pursued the McStop concept further, with discussions continuing into the Spring of 1987 but without reaching any agreement. It was after Mr. Hazard received the letter about McStop, however, when he selected the name McSleep for his new, budget-market product.

The final factor contributing to the Court’s belief that Mr. Hazard had McDonald’s in mind when he selected the name McSleep is the evidence that Mr. Hazard’s thinking was not limited to the one word McSleep, but rather a family of words, all created by using the prefix “Me” with a generic word. In the Spring of 1987 when he instructed his attorneys to register and protect the name McSleep, he also directed registration of the names “McSuite” (which he intended to use for two rooms at McSleep Inn connected by a door) and “McBudget.” At trial, Quality International indicated its abandonment of the “McSuite” name and concept, and no evidence was received about the role or intended use of McBudget.

Following selection of the name McSleep, and prior to presentation of the concept to the Board of Directors of Quality International in June, 1987, a trademark search was conducted of “McSleep” in which the report revealed to Quality International management numerous uses of “Me” formatives owned by McDonald's. Mr. Frederick W. Mosser, the vice president in charge of franchising, said that he was surprised at how many marks McDonald’s owned. He indicated that while he perceived some risk in proceeding with the name McSleep, he felt that these reservations were overcome in his mind by the facts that McDonald’s was in the food business and Quality International was in the lodging business, and that the names would be displayed in a distinctive manner.

Following approval by the Board in June of 1987, Mr. Hazard directed Susan B. Dynerman, his director of public relations, to make preparations for the public announcement of McSleep Inn at the trade show in Chicago in September 1987. When Mr. Hazard advised Ms. Dynerman of the new product, she raised questions “whether we could use the name____ I associated it with McDonald’s.”

A similar concern was expressecl by Quality International’s advertising agency. The account representative, Mr. Barry Smith, anticipated that McDonald’s “would be overjoyed” with the McSleep Inn announcement, and he promptly proceeded to obtain an indemnity agreement from Quality International, protecting the agency against litigation by McDonald’s. He had never before asked for an indemnity agreement from Quality International during the ten years that the agency had been representing Quality International.

Several weeks before the public announcement, Mr. Hazard engaged a market research firm to conduct a survey to determine which of several mock up versions of a McSleep Inn room had the most consumer appeal. The survey was conducted of 120 people outside of Quality International and a slightly larger number of employees. Each participant was given a questionnaire inquiring about specific aspects of the rooms under consideration. There was one question, however, inserted at Mr. Hazard’s request, that read as follows: “What is your overall impression of the name ‘McSleep Inn’ for the type of hotel/motel *206accommodations described in the above statement?” The respondent was then given a choice of four grades ranging from "excellent name” to “poor name.” Over 40 of the respondents volunteered a written comment in response to that question suggesting an association with McDonald’s. Typical of the comments were: “Sounds like relationship to McDonald’s food chain,” or “Sounds cute but I thought it might be affiliated with McDonald’s,” or “Possibly owned by McDonald’s,” or “Reminds me of McDonald’s.”

When Mr. Charles Riter, president of the research firm, advised Mr. Hazard of the result some three to four weeks before the public announcement, Mr. Hazard agreed that it had occurred to him that “some people might associate or refer to or see in the name McSleep some relationships with McDonald’s.” He observed that the confusion, if any, associated the room with a “greasy hamburger” and that did not bother him, because the rooms were better.

In September 1987, at a meeting of Quality International’s sales force convened to announce the new McSleep Inn product, questions also were raised by salespersons of Quality International whether Quality International had the right to use the name McSleep.

Despite the persistent questioning by representatives of Quality International with respect to its rights to use McSleep Inn, Mr. Hazard proceeded with the public announcement on September 21, 1987. A press release was issued and Mr. Hazard also delivered a speech to the trade show in Chicago describing his new hotel. Prior to the public announcement, he invited interviews with the Washington Post and a trade magazine, Hotel and Motel Management. In the Washington Post article, Mr. Hazard is quoted as saying:

Obviously, [the name is] a takeoff on McDonald’s and quality at a consistent price____ We think we’re going to let McDonald’s continue to use their name.

Mr. Hazard admitted making that statement generally but stated he did not refer to the name of McDonald's but rather the concept. He added that the final sentence in the quote was made in jest in response to the reporter’s persistent questioning about McDonald’s.

With respect to the interview given to Hotel and Motel Management, Mr. Hazard expressed complete confidence in the reporter, who was a long-time friend. Mr. Hazard acknowledged the accuracy of all the quotations made of him and does not fault the reporter for making any comments. That article reported as follows:

And yes, the not-so-subtle reference to fast-food giant McDonald’s is purely intentional.
“The concept is just like McDonald’s,” Hazard said. “A guy making $150,000 a year can eat there and feel comfortable and a guy making $10,000 a year can eat there and feel comfortable because he knows what he’s getting — consistent quality. And that doesn’t exist in the lodging industry.”

The inquiries about McDonald’s, that began with employees and continued with reporters, were repeated by the attendees at the conference in Chicago.

Quality International not only was aware of the risk that attended its adoption and use of the name McSleep Inn, a risk that it was infringing McDonald’s family of marks, but it also had good reason to believe that the public might be actually confused. It nevertheless proceeded with both the announcement and its plans to sell franchises for McSleep Inn.

Three days after the public announcement, McDonald’s wrote to Quality International complaining of its planned use of the words “McSleep” and “McSuite” and demanding the immediate discontinuance of those plans. There followed some telephone conversations between the parties, but before any issue was resolved, Quality International filed suit in this court, five days after McDonald’s sent its letter.

Beginning in June, 1987 Quality International began making changes in the presentation of McSleep Inn that were intended to emphasize McSleep Inn’s association with Quality International. Quality International’s four chain logo was to be pictured on a *207flag to be placed outside each McSleep Inn, on a decal to be placed on the front door, and on the wall behind the registration desk. It changed the name from “McSleep” to “McSleep Inn.” It adopted a policy of including the four chain logo with all corporate advertising. And three weeks before trial, after the Court had already heard motions for summary judgment in this case, it added a small sign underneath the McSleep Inn sign on the main pylon in front of the hotel which reads “by Quality International.”

The McSleep Inn mark has not been exposed to the consuming public in connection with the sale of McSleep Inn services, although hundreds of franchise packets have been sent out to potential franchisees of McSleep Inn. To date only four franchises are signed up, but others are in process. The first McSleep Inn is scheduled to open in Pikesville, Maryland, in December 1988.

The earliest justifications given by Mr. Hazard and Mr. Mosser, the vice president in charge of franchising, for using the name McSleep Inn in the face of McDonald’s family of marks, were grounded on the observation that McDonald’s was in the fast-food business and Quality International was in the lodging business. Later they urged that the “Me” prefix had become generic and was in the English lexicon and that the mark McSleep Inn would be displayed in a distinctive manner.

V. SURVEY TESTIMONY

It is undisputed that appropriate survey evidence is meaningful to establish the likelihood of confusion, and at trial each party presented survey evidence of its own and offered a critique of the survey evidence presented by the other.

A mall intercept survey was conducted on behalf of Quality International by Dr. Jacob Jacoby, a professor at New York University. This type of survey is conducted at randomly selected shopping malls by showing participants a visual stimulus and obtaining responses to questions.

Dr. Jacoby’s survey was actually four separate surveys, each conducted in connection with a different visual stimulus. About 160 respondents were interviewed in each of the surveys. The first of the four stimuli used in the mall intercept survey by Dr. Jacoby was an advertisement for Quality International as it would appear in an airline magazine. The text of the advertisement contained a reference to McSleep Inn along with other products of Quality International, and the four chain logo was included at the bottom. That advertisement did not advertise McSleep Inn specifically. The second stimulus was a mock up of a yellow page display advertisement in which a McSleep Inn was advertised with the McSleep Inn logo and the four chain logo which included the name Quality International. The third stimulus was an artist rendering of a proposed McSleep Inn in front of which was a sign on a pylon that included the McSleep Inn logo and under which there was a smaller sign with the words “by Quality International.” Finally, a control survey was conducted by showing the respondents a picture of an Egg McMuffin sandwich with the words Egg McMuffin written underneath it.

In connection with the survey involving the airline advertisement, despite the fact that arrows were added to the advertisement pointing to McSleep Inn, only 57 percent of those surveyed were aware that McSleep Inn was being advertised. Of those 57 percent, in response to the question “Who or what company, or companies, is that [that owns or operates this motel]?” only 7.5 percent responded “McDonald’s.”

In connection with the yellow page stimulus, of 164 respondents, 83 percent (or 136 respondents) knew that the advertisement was advertising McSleep Inn. Of those, 10.3 percent identified McDonald’s as the name of the company that owns or operates McSleep Inn.

With respect to the artist’s rendering of a McSleep Inn, 163 respondents were shown the picture and 147 indicated they knew that McSleep Inn was being advertised. Of those 16.3 percent said that McDonald’s was the company that owns or operates the hotel. If the responses are limited to those who had made decisions *208during the previous year about staying in hotels or motels, 21.4 percent of those responding identified McDonald’s as the owner or operator of the McSleep Inn.

Finally, with respect to the picture of an Egg McMuffin, 87 percent of those shown the picture identified it as a product of McDonald’s.

Dr. Jacoby concluded that these figures reflected “a low level of likelihood of confusion.” He went on to point out that one would predict that as McSleep Inns were advertised and became more widely known to the public “even the current low level of likely confusion would be substantially reduced.”

McDonald’s offered two surveys conducted by Dr. Hans Zeisel, a professor at the University of Chicago. His first survey was a telephone survey conducted of a statistical sample of the population consisting of 400 persons randomly selected. The first two questions asked of the respondents were:

If you were driving along the highway and you saw a sign for a hotel called McSleep Inn [the name is spelled out], what would you expect this hotel to be like?

and

And who or what company do you believe owns or operates this hotel called McSleep Inn?

Dr. Zeisel testified that the first question was a warmup that introduces the respondent to the subject of the inquiry, i.e. McSleep Inn, and that the second question was the critical one. In response to the second question, 31 percent of the people surveyed answered, “McDonald’s.” If only the respondents who stayed in a hotel at least once during the past 12 months are included, 33 percent answered “McDonald's;” and if only respondents who stayed in hotels at least 12 times during the past year are counted, 39 percent responded “McDonald’s.” He concluded that naming a hotel “McSleep Inn” would likely cause confusion among “a substantial proportion of the population by leading them to believe that this hotel is somehow related to McDonald’s.”

Dr. Jacoby, Quality International’s expert, criticized the survey by Dr. Zeisel, arguing that the warmup question was merely a free association question which was leading and prompted the answer to the second question. It was also contended that the survey only tested auditory response to McSleep Inn and provided no visual stimulus, which was unlike the real world. He urged that a “mall intercept” survey would be superior.

Although Dr. Zeisel was not in favor of mall intercept surveys because such surveys cannot as a practical matter be performed on a valid statistical sample, in response to the criticism of Dr. Jacoby he conducted a second survey using a visual stimulus. In the second survey, Dr. Zeisel also eliminated the first question of his first survey to prove, as he testified, that the first question did not materially alter the results.

The mall intercept survey conducted by Dr. Zeisel interviewed 401 persons at randomly selected shopping malls across the country. After two unrelated warmup questions, the respondent was asked the following question:

Please take a look at this. Here is a photograph of a sign for a hotel you might see if you were driving along the highway. [The witness was then shown the McSleep Inn logo that is the subject of registration before the Patent and Trademark Office.] Who or what company do you believe owns or operates this hotel?

Over 31 percent (31.9%) of all the respondents expressed the belief that McDonald’s owns or operates the hotel. If only respondents who stayed in a hotel at least once during the last 12 months are included, 34.5 percent believed that McDonald’s owns or operates McSleep Inn; and if only respondents who stayed in hotels 12 or more times during the past year are included, 38.5 percent believed that McDonald’s owns or operates McSleep Inn.

The results obtained by Dr. Zeisel in his two surveys are not materially different, *209producing results within a percentage point or two of each other.

Dr. Zeisel criticized Dr. Jacoby’s surveys in several respects. The principal criticisms were in three areas. With respect to the airline magazine advertisement and the yellow page advertisement, the MeSleep Inn trademark was so diluted by the Quality Inns logo that a significant number of people did not even know that MeSleep Inn was being advertised. In that context, he did not believe that any meaningful results were obtained. With respect to the artist’s rendering of the MeSleep Inn, he agreed that the concept was appropriate, but criticized the fact that the respondent was shown a logo that included the phrase “by Quality International” underneath it. Not only did he consider that to be nothing more than a reading exercise for the respondent, but he observed that the respondent was allowed to retain the picture in front of him when answering the questions.

McDonald’s presented evidence that showed that of the 70 persons in Dr. Jacoby’s survey who correctly identified the hotel with Quality International, 50 said they did so because they read it on the sign. When asked why they identified MeSleep Inn with Quality International, typical responses were: “It says so on the ad,” “The ad tells you that it’s operated by Quality Inns International,” “Because it says so,” or “Because it says so on the sign I just read.” McDonald’s offered similar evidence on the yellow page advertisement and the airline advertisement where the respondents indicated they simply read Quality International in the advertisement.

Quality International justified its inclusion of “by Quality International” with the reason that it had made the decision to include that on the sign and wanted to test real life circumstances.

VI. APPLICABLE LEGAL PRINCIPLES

Trademark law gives the owner of a mark the right to preclude a use by a junior owner of a mark that causes or is likely to cause confusion, cause mistake, or deceive an appreciable number of typical consumers into believing that some sponsorship, association, affiliation, connection, or endorsement exists between the owner of the senior mark and the owner of the junior mark. See, e.g. 15 U.S.C. § 1114(a), but common law concepts of unfair competition are similar. The gist of a claim for trademark infringement, or the related commonlaw tort, is a sanction against one who trades by confusion on the goodwill or reputation of another, whether by intention or not. There are but two inchoative elements that must be established for entitlement, from which all permutations and guises of the cause of action are derived: the senior owner of the mark must demonstrate (1) the adoption and use of a mark and his entitlement to enforce it, and (2) the adoption and use by a junior user of a mark that is likely to cause confusion that goods or services emanate from the senior owner. Yale Electric Corf. v. Robertson, 26 F.2d 972 (2d Cir.1928). The articulation of standards and criteria are numerous for reaching the conclusion whether plaintiff has made his case.

The owner of a mark who has developed a reputation and identity with a mark through his products, service, marketing, and presence in the market, has an interest in protecting the business and reputation for which the mark stands, not only at the present time in the current markets in which he does business, but for future times and in related markets that the development of his business might naturally take him. Communications Satellite Corp. v. Comcet, Inc., 429 F.2d 1245 (4th Cir.), cert. denied, 400 U.S. 942, 91 S.Ct. 240, 27 L.Ed.2d 245 (1970); Yale Electric Corf. v. Robertson, 26 F.2d 972 (2d Cir. 1928); McDonald’s Corp. v. McBagel’s, Inc., 649 F.Supp. 1268 (S.D.N.Y.1986). The extent to which he may protect this interest relates directly to the strength of his mark. While one mark may not enjoy the strength of identity to preclude use of a junior mark in a related field or neighboring market, another may enjoy such recognition that confusion might result outside his own field or beyond the markets in which he does business. See, e.g. Maier Brewing *210 Co. v. Fleischmann Distilling Corp., 390 F.2d 117 (9th Cir.), cert. denied, 391 U.S. 966, 88 S.Ct. 2037, 20 L.Ed.2d 879 (1968) (beer vs. scotch); Cook Chemical Co. v. Cook Paint & Varnish Co., 185 F.2d 365 (8th Cir.1950) (paint vs. insecticide); Carling Brewing Co., Inc. v. Philip Morris, Inc., 277 F.Supp. 326 (N.D.Ga.1967) (beer vs. tobacco); Esquire, Inc. v. Maira, 101 F.Supp. 398 (M.D.Pa.1951) (magazine vs. clothing store). The measurement of this strength is revealed by evidence demonstrating a likelihood of confusion. The relationship of these two factors, strength and confusion, operates such that evidence of strength of a mark is perhaps the most significant factor in predicting the likelihood of confusion. On the other hand, evidence of the likelihood of confusion in a related field or neighboring market, or even in a competitive market, defines the scope of a mark’s enforcement and therefore is the measurement of its strength. Variations on the weight of evidence on these two aspects, i.e., the strength of the mark and the likelihood of confusion, will determine whether one mark will preclude the use of a later adopted and used mark.

Accordingly, a mark may enjoy such strength that it may be enforced in related fields or neighboring markets, whether they are product markets or territorial markets. Or, stated obversely, the likelihood of confusion in related fields or neighboring markets will demonstrate the strength of the mark. Communications Satellite Corp. v. Comcet, Inc., supra; Yale Electric Corp. v. Robertson, supra; McDonald’s Corp. v. McBagel’s, Inc., supra. Thus, a mark is not to be confined formulistically to a classification established by the Patent and Trademark Office or by lines of market competition. A mark is the identity of a corporation, a product or a service, and to the extent goodwill attaches, it knows no boundaries. Its reach is its strength. Where the public is confused and attributes a source, product, or service incorrectly, the owner of the mark, even though not a competitor, may experience damage to his reputation and goodwill. Both of these may have more meaning to the owner than immediate profits in the marketplace because they represent the potential for long range future profits.

On the other hand, two marks that serve to identify products in two unrelated markets may very well coexist without confusion in the public’s eye. Thus Notre Dame brand imported french cheese has been permitted to coexist with Notre Dame University; Bulova watches with Bulova shoes; Alligator raincoats with Alligator cigarettes; “This Bud’s for you” in beer commercials with the same phrase used by a florist; White House tea and coffee with White House milk; Blue Shield medical care plan with Blue Shield mattresses; Family Circle magazine with Family Circle department store; Ole’ cigars with Ole’ tequila; and Sunkist fruits with Sunkist bakery products. The list continues.

The determinative test cannot focus on how close or related the industries or products are, but rather by whether confusion is created so that an appreciable number of typical consumers will likely be confused.

It cannot be overlooked, however, that a close affinity of markets for two different products or services can create in the public perception a belief or expectation that one would be expected to go into the other. This belief or expectation becomes a factor in explaining confusion that may be shown between two products that do not compete with each other. Thus, the relatedness of markets in which the competing marks are used is relevant to the likelihood-of-confusion issue.

The enforcement of trademark rights to prevent use on related, but noncompetitive, goods is sometimes referred to as the “Aunt Jemima doctrine.” The rule dates from the 1917 decision of the Second Circuit in Aunt Jemima Mills Co. v. Rigney & Co., 247 F. 407 (2d Cir.1917) cert. denied, 245 U.S. 672, 38 S.Ct. 222, 62 L.Ed. 540 (1918), which enforced the mark “Aunt Jemima” used by the plaintiff on pancake batter against use of the same mark on defendant’s pancake syrup. The court rejected the old rule limiting enforcement to competitive goods and said a mark would *211be protected on any goods which buyers would be likely to think came from the same source as plaintiffs goods.

[W]e think that goods, though different, may be so related as to fall within the mischief which equity should prevent. Syrup and flour are both food products, and food products are commonly used together. Obviously the public, or a large part of it, seeing this trademark on a syrup, would conclude that it was made by the complainant. In this way the complainant’s reputation is put in the hands of the defendant.

247 F. 409-10. The Aunt Jemima doctrine was given strong impetus in Yale Electric Corp. v. Robertson, supra, where the owner of the Yale mark used in connection with the sale of locks, was permitted to preclude the use of the mark in connection with the sale of flashlights. In an oft-quoted opinion, Judge Learned Hand noted that infringement and injury can occur even when the junior user uses a mark on related, but noncompetitive, goods:

However, it has of recent years been recognized that a merchant may have a sufficient economic interest in the use of his mark outside the field of his own exploitation to justify interposition by a court. His mark is his authentic seal; by it he vouches for the goods which bear it; it carries his name for good or ill. If another uses it, he borrows the owner’s reputation, whose quality no longer lies within his own control. This is an injury, even though the borrower does not tarnish it, or divert any sales by its use; for a reputation, like a face, is the symbol of its possessor and creator, and another can use it only as a mask. And so it has come to be recognized that, unless the borrower’s use is so foreign to the owner’s as to insure against any identification of the two, it is unlawful____ The disparity in quality between [the senior user’s] such wares and anything the [junior user] makes no longer counts____ The [senior user] need not permit another to attach to its good will the consequences of trade methods not its own.

26 F.2d at 974 (citations omitted).

When the strength of the mark is so pervasive, however, to the point that the public actually attributes competitive products or services to the mark without the intent of attributing source, then the mark may be lost to the public domain. The public comes to understand the mark to refer only to the kind of goods and not to the origin. Thus, once enforceable marks such as aspirin, thermos, cellophane, and escalator have become generic words. Bayer Co., Inc. v. United Drug Co., 272 F. 505 (2d Cir.1921); King-Seeley Thermos Co. v. Aladdin Industries, Inc., 321 F.2d 577 (2d Cir.1963); King-Seeley Thermos Co. v. Aladdin Industries, Inc., 418 F.2d 31 (2d Cir.1969); DuPont Cellophane Co., Inc. v. Waxed Products Co., Inc., 85 F.2d 75 (2d Cir.1936); Haughton Elevator Co. v. Seeberger, 85 U.S.P.Q. 80 (1950).

It is therefore necessary to measure, on the one side, the strength of the mark asserted and, on the other, the factors suggesting a likelihood of confusion, fully recognizing even as separate analyses are discussed that the two are integrally related. The first of these, strength of the mark, is now analyzed factually and how it is affected by charges that (1) third-party uses of McDonald’s marks have eroded or precluded their enforcement and (2) the prefix “Me” is now generic.

VII. STRENGTH OF MCDONALD’S MARKS

McDonald’s golden arches and the McDonald’s logo rank among the strongest marks, enjoying instant recognition among virtually all members of our society. As noted earlier, evidence showed that among children McDonald’s “Ronald McDonald” enjoys virtually 100 percent recognition. To take judicial notice of a mark would perhaps be unprecedented, but the parties were not troubled with the notion in this case as to some of McDonald’s marks such as the golden arches and Big Mac. See Fed.R.Evid. 201. Because of the ample presentation of evidence on the promotion and awareness of the marks of McDonald’s, the Court will not be required to consider whether judicial notice should be *212taken here. McDonald’s spends almost a billion dollars each year on marketing and advertising, a sum which increases steadily with its sales, which are at $14 billion. While the fact that McDonald’s is the largest single brand advertiser in the United States could alone lead to the conclusion of the strong public awareness of its marks, the evidence showed affirmatively that awareness was virtually universal, to the point where a journalist could allude to McDonald’s, without using its name, by coining words as “McLaw,” “McPaper,” and “McFashion.”

The power of this public recognition of McDonald’s is evidenced in various ways.

In recent years, McDonald’s began to focus on a long distance travel market, defined by customers traveling on the road who are more than 30 miles from home when they use the service. Pursuing this market, McDonald’s took over numerous tollway restaurants and converted them to McDonald’s restaurants. After the first year of conversion, the increased sales at all of the restaurants that were converted averaged over three times the previous year’s sales, and indeed the sale of gas at the neighboring gas station increased significantly, although not as much. McDonald’s attributes these successes to its recognition.

The attribution to McDonald’s, however, has not been totally under its control. Journalists have created their own words by adding “Me” to a generic word. The Court was presented with literally hundreds of such uses, such as McLaw, McTax, McNews, McPaper, McSurgery, McArt, even McGod. Since the issue is raised in this action that “Me” words have become generic, the Court will address the scope of this usage more fully below.

As part of its promotion, McDonald’s created a language that it called “McLanguage” from which it developed a family of marks for its products such as McChicken, McNugget, McPizza, as well as marks outside the food area related to its business such as McStop, McKids, and McShuttle. There is no evidence that this language or these marks existed before McDonald’s created them or that, outside of McDonald’s sphere of promotion and presence, anyone would understand these words to mean anything. “Me” obviously is a Scottish or Irish surname used in proper names. The use to form words, however, was unique at the time. The marks that are owned by McDonald’s and that were formulated by combining “Me” and a generic word are fanciful and enjoy a meaning that associates the product immediately with McDonald’s and its products and service.

They also constitute a family of marks that is enforceable against infringing uses, and since they are fanciful they will be given the strongest protection. McDonald’s Corp. v. McBagel’s, Inc., 649 F.Supp. 1268 (S.D.N.Y.1986).

A family of marks may have a synergistic recognition that is greater than the sum of each mark. But that is not to say that the prefix “Me” coupled with any generic word may be precluded by McDonald’s. Each allegedly offending use must be tested against the likelihood of confusion, for the scope of enforceability, as the Court has already noted, is measured by the scope of confusion.

In this case the only examination that is made, and the only conclusions that are reached, relate to the allegedly infringing use of “McSleep Inn” by Quality International in the lodging business.

VIII. THIRD-PARTY USES OF “MC”

Quality International has pointed out that there are a substantial number of third-party uses of “Me” with a generic word that would give rise to infringement to the same extent as would the mark McSleep Inn. Quality International urges that these uses by third parties are so pervasive that McDonald’s should now be denied the right to enforce its marks against McSleep Inn.

In recent years a significant number of third-party uses of “Me” with a generic word has occurred in the commercial area. While the plaintiff proffered many such purportedly infringing marks from the *213trademark register, the Court received into evidence as relevant only those marks on which there was evidence of actual use in the marketplace. These uses were evidenced by telephone directories, visual observations, credit reports, newspaper references, and telephone calls to the businesses.

The evidence established that there are many third-party uses. McHappy and McDonuts are used for baked goods and doughnuts in Ohio and the midwest area. McMaid is used for maid service franchising in various midwestern states. McDivots is used for golf accessories in the Colorado area. McFranchise is used for management consulting in the northeast. McMoose is used in Heritage Park on the east coast. McWest is used for contracting. McSports is used for a sports store in a strip shopping center. McPrint is used for franchised printing in the New York area. McQuick is used for quick change lubrications in the midwest area, mostly Indiana. McBud is a florist in the midwest.

Prior to 1984, McCrory’s used McBurger, McCheddar, and McCheese for various hamburger sandwiches. These uses were phased out pursuant to an agreement with McDonald’s, and McCrory’s retained only Captain Mac’s restaurant. Likewise, McAuto is used for computer data by McDonnell Douglas, but it, too, is being phased out. McJeans has been used to label wholesale jeans, but not at retail. McDuck is used in connection with greeting cards in a small business which has $3,000 in advertising per year. McTavern is used to name a lounge and deli in Indiana. There were other uses, but most of them are not significant in terms of market, product, advertising, or public awareness. Still other names use the prefix “Mac,” instead of “Me.” While McDonald’s has the well-known marks “Big Mac” and “Mac Attack,” no formulated mark using a prefix “Mac” plus a generic word was brought to the Court’s attention.

There are four of these third-party uses which the Court considers significant: McQuick for franchised oil change operations in the midwest, McPrint for franchised printing shops in the New York area, McHappy for baked goods in the mid-west, and McMaid for the franchising of maid service in the Chicago area. In these instances, the uses were franchised for use at multiple locations, and they must be considered when examining the strength and enforceability of McDonald’s marks in this case.

While McDonald’s elected not to present evidence on its policing activities, contending perhaps correctly in this case that the issue is not whether they enforce marks against others, but rather whether objectively there are third-party uses that dilute the strength of their marks, evidence did come in peripherally suggesting action being taken by McDonald’s against firms using McHappy, McTravel, McDivots, McQuick, McMaid, McPrint, and others.

Permitting the use by third parties of infringing marks can be relevant to three specific issues in a trademark case. If a trademark owner has expressly or impliedly given an assurance to another user that he will not assert his trademark rights, he may be barred from enforcing his mark against that user, by reason of estoppel by acquiescence. Sweetheart Plastics, Inc. v. Detroit Forming, Inc., 743 F.2d 1039 (4th Cir.1984).

Acquiescence may be inferred from conduct as well. Thus, delay in enforcement of a mark against a defendant may become relevant to the question of estoppel by acquiescence. Carl Zeiss Stif tung v. V.E.B. Carl Zeiss Jena, 433 F.2d 686 (2d Cir.1970), cert. denied, 403 U.S. 905, 91 S.Ct. 2205, 29 L.Ed.2d 680 (1971); Ambrosia Chocolate Co. v. Ambrosia Cake Bakery, 165 F.2d 693 (4th Cir.1947), cert. denied, 333 U.S. 882, 68 S.Ct. 914, 92 L.Ed. 1157 (1948). Whether a trademark owner delayed in enforcing its trademark rights against others, however, is not relevant to establishing an estoppel defense, since estoppel by acquiescence focuses on a plaintiffs acts toward the defendant, not toward others. Acquiescence is a personal defense that merely results in a loss of rights against the defendant. Sweetheart Plastics, 743 F.2d at 1046.

*214Third-party uses permitted by the owner of a mark may also be probative of the abandonment of a mark by the owner. A mark is abandoned when any course of conduct of the owner, including acts of omission as well as commission, causes the mark to lose its significance as an indication of origin. See 15 U.S.C. § 1127(b). Failing to take action against an infringer has been held to be such an “act of omission.” Sweetheart Plastics, 743 F.2d at 1047; Wallpaper Mfgs. Ltd. v. Crown Wallcovering Corp., 680 F.2d 755, 766 (C.C.P.A.1982). Once a mark has been held abandoned, it is free for all to use and falls into the public domain. It may be seized by another, and the person doing so gains rights against the whole world. 15 U.S.C. § 1115. However, as the court in Sweetheart Plastics emphasized, “[t]he issue is hardly ever ‘abandonment,’ because that requires proof that the mark has lost all significance as an indication of origin” and is “completely without signs of life.” 743 F.2d at 1047-48.

So long as there is no abandonment or estoppel by acquiescence, a trademark owner’s tolerance of third-party uses of his marks will not bar enforcement of his rights against an infringing user. It may, however, bear on the issue of the strength of his mark. The damage that third-party users of a mark can cause an owner who seeks to enforce his mark is the weakening of the mark’s strength. Failure to take reasonable steps to prevent third-party uses of the mark may weaken a mark to the point where it is entitled to only a narrow scope of enforcement, and ultimately the question may become one of abandonment. However, where the owner of the mark has been reasonably diligent in protecting his rights, even though infringements exist, no intent to abandon will be inferred. J. Thomas McCarthy, Trademarks and Unfair Competition, § 17:5 (2d Ed.1984 & Supp.1987).

In this case Quality International does not contend that McDonald’s has abandoned its family of marks or that McDonald’s has acquiesced in Quality International’s use of McSleep Inn. The Court likewise reaches those same conclusions based on the evidence presented. McDonald’s gave no assurances, expressly or impliedly, to Quality International that it could use McSleep Inn, and McDonald’s did not delay in pursuing enforcement of its marks. The evidence of third-party uses introduced by Quality Inns therefore is probative only of the strength and scope of McDonald’s family of marks. These uses will not preclude the enforcement of those marks against Quality International.

The Court can point to no evidence that public awareness of McDonald’s family of marks and their attribution of source to McDonald’s has been lessened by the third-party uses. The more important question, and probably the only relevant one, is whether third-party uses are so prevalent that the public would not likely confuse McSleep Inn with McDonald’s. The Court found no evidence to suggest impact by third-party uses on this question of confusion. Although the question is more fully encompassed in the answer to the issue whether McSleep Inn is likely to cause confusion, which is discussed below, suffice it to conclude at this point that third-party uses do not preclude McDonald’s enforcement of its family of marks.

IX. GENERIC DEFENSE

Both Mr. Hazard, Quality International’s CEO, and Mr. Mosser, its vice president in charge of franchising, urged at trial that “Me” has become a generic prefix meaning thrifty, consistent, and perhaps convenient. They urge that the notion of thriftiness comes from the association with the Scots and the perception that the Scots are thrifty. The Court was directed to the writings of H.L. Mencken, the famous Baltimore journalist and writer, who said:

Nearly all the English words and phrases based on Scotch embody references to the traditional penuriousness of the Scots, for example Scotch coffee, hot water flavored with burnt biscuit; to play the Scotch organ, to put money in a cash register; Scotch pint, a two-quart bottle; Scotch sixpence, a threepence; and the Scotchman’s cinema, Piccadilly *215Circus, because it offers many free attractions.

The American Language by H.L. Mencken (4th Ed. Abridged with Annotations and Material by Raven I. [appropriately] McDavid, Jr.), at pages 388-89.

Both Mr. Hazard and Mr. Mosser acknowledge that the aspect of “Me” that includes consistency and convenience derives from McDonald’s and its extensive promotional efforts. They urge, however, that any such association with McDonald’s is now lost to the public domain by common usage.

In support of the contention that “Me” as a prefix has derived a singular meaning and become part of the language, Dr. Roger W. Shuy, a linguist from Georgetown University, reviewed hundreds of journalistic uses of the prefix “Me” for purposes of deriving its meaning and to evidence it common usage. Several examples will give a sampling of the broad range of his findings.

The term “McFood” has been used as follows: “It’s a push-button, do-it-yourself, convenience-oriented world____ Why cook when we can zap a Lean Cuisine in the micro, or order McFood from a drive-in McSpeaker.” Similarly, the word McLunch has been used for what kids are eating in school.

In the area of clothes, McFashion has been used in connection with smaller, specialized express stores for kids, imitating the concept of a fast food outlet.

McMedicine has been used to refer to prompt, inexpensive medical care centers, and McSurgery becomes surgery without overnight hospital stays.

McLaw has been used to describe the legal franchise phenomenon, suggesting that legal advice is dispensed through drive-in windows. Describing franchising in other areas have been McFuneral for funeral operations; McLube or McOil Change for the fast, little drive-in shops offering ten-minute oil changes; and McMiz for franchising of the Broadway musical “Les Misc.ables.” Even the franchising of local post office branches has been suggested to become McMail, and franchised tax preparation as McTax.

In the news and media area, USA Today has been characterized as McPaper, “fast news for the fast-food generation.” There was even a book called The Making of McPaper. The distillation of books or books without substance has been referred to as McBook, and similar characterizations have been made about digested news stories, McNews.

Even culture that has been subjected to mass marketing has been characterized with the prefix “Me.” The proliferation of low-cost mass-produced art is McArt. One article even referred to McMozart.

Movies that are analogized to fast food which satisfy the appetite and taste good have been called McMovies or McCinemas. Similarly, there is McTelevision, McTelecast, and McVideo.

No subject seems to have been excluded. In connection with religion there has. been a reference to McGod: “It was a difficult year for the McGod family network. [Jimmy Baker, Jimmy Swaggart, and Jerry Falwell] fought a major turf battle over control of the PTL McTelevangelism.”

One article perhaps summarized it all, “This is the era of instant gratification, of poptops, quick wash, fast fix, frozen foods, McEverything.”

A news report placed into evidence referred to the trial before this Court as taking place in the McCourt, which, of course, would make the judge the McJudge. While the Court understood that association with the Courthouse in Baltimore, it could not come to grips with the suggestion that the trial was before a McJudge. The Court could find few, if any, of the attributes of “Me” used by McDonald’s or by the journalists otherwise to fit. Perhaps this McPinion will fulfill that prophecy.

After reviewing these articles and numerous others, Dr. Shuy reviewed the context of the “Me” word and derived a list of 27 definitions for the prefix “Me”: highly advertised; franchise; easy access; inexpensive; high volume; lacks prestige, com*216fort, cost; everyday; prepackaged; specialty chain; quick; convenient; reduces choices; self-service; mass merchandising; standardized; state of the art marketing; low brow; assembly line precision; uniform; market dominance formula; handy location; positive attitude; simple; comfortable; honest; looks okay; and working man. He reduced these to four terms which he characterizes as the definition of “Me,” that is, “basic, convenient, inexpensive, and standardized.”

McDonald’s retained an outside firm to do its own internal marketing research into the public perception of the meaning of “Me” and the conclusions reached were similar to those reached by Dr. Shuy. McDonald’s list, which was much shorter, distilled the following definitions: (1) “reliable at a good price,” (2) “prepackaged, consistent, fast, and easy” (3) “a prefix McDonald’s adds to everything it does,” and (4) “processed, simplified, has the punch taken out of it.”

Dr. David W. Lightfoot, a linguist from the University of Maryland, testified at trial on behalf of McDonald’s. He took no issue with the meanings derived by Dr. Shuy and by McDonald’s own internal survey. However, he disputed vigorously any notion that “Me” is a generic word. He pointed out that “Me” does not have a single easy identifiable meaning. For instance, of the 27 or so definitions derived by Dr. Shuy from the journalistic uses, many were not incorporated into Dr. Shuy’s condensed definition. Dr. Lightfoot concluded that all the meanings derived by Dr. Shuy, by McDonald’s and by him were essentially descriptive of McDonald’s Corporation and the reputation it has earned over the years. He concluded that whether or not there was a specific reference to McDonald’s Corporation in each article, in every case the allusion was to McDonald’s and its family of marks in a manner that was intended to be cute and playful.

The Court concludes that indeed the uses in the press of “Me” plus a generic word are coined and novel to each article for the playful use by the author. In each case the allusion, whether express or implied, was to McDonald’s, sometimes flattering and sometimes pejorative. There was no single independent meaning of “Me” understood in the language and its uses have been created to convey any one of several attributes that the author makes to McDonald’s.

This is not analogous to a circumstance where a product is referred to so frequently by brand name that even competitive brands are called by the one name and the brand identity is lost. On the contrary, the attribution of source to McDonald’s in the use of “Me” is strong and persists. The Court notes that while most of the articles used by Dr. Shuy did not contain express allusions to McDonald’s, a very similar group of articles that he did not use in his analysis, but which conveyed the same meanings, made express allusions to McDonald’s. The Court therefore rejects any contention that McDonald’s has lost its right to enforce its marks because “Me” has become a prefix with a single meaning that has become part of the English language and beyond McDonald’s control.

X. LIKELIHOOD OF CONFUSION

The central question for resolution in this litigation is whether the use of McSleep Inn is likely to cause confusion so that an appreciable number of the public attribute the product and services of McSleep Inn to McDonald’s. Thompson Medical Co., Inc. v. Pfizer, Inc., 753 F.2d 208 (2d Cir.1985); Spring Mills, Inc. v. Ultracashmere House, Ltd., 689 F.2d 1127 (2d Cir.1982); Eastern Wine Corp. v. Winslow-Warren, Ltd., 137 F.2d 955 (2d Cir.), cert. denied, 320 U.S. 758, 64 S.Ct. 65, 88 L.Ed. 452 (1943).

When the junior mark has not been presented to the consuming public, as it has not been in the instant case, there is less opportunity to determine whether actual confusion exists. In circumstances' such as these, other factors for analysis become important. In Pizzeria Uno Corp. v. Temple, 747 F.2d 1522 (4th Cir.1984), the Fourth Circuit accepted a list of seven factors to consider in determining the likeli*217hood of confusion. The list, which was borrowed from Sun-Fun Products v. Suntan Research and Development, Inc., 656 F.2d 186, 189 (5th Cir.1981), directs inquiry into the following factors: (1) the strength or distinctiveness of the mark; (2) the similarity of the two marks; (3) the similarity of the goods or services which the marks identify; (4) the similarity of the facilities used by the parties in conducting their businesses; (5) the similarity of advertising used by the parties; (6) the defendant’s intent; and (7) actual confusion.

The Second Circuit has developed a similar list of some nine factors to consider, as follows: (1) the strength of the mark; (2) the similarity between the two marks; (3) the similarity of the products; (4) the likelihood that the prior owner will bridge the gap; (5) actual confusion; (6) the good faith of the junior user in adopting its mark; (7) the quality of the junior user’s product; (8) the sophistication of buyers; and (9) the relative harm to the parties if an injunction is granted. See Polaroid Corp. v. Polarad Electronics Corp., 287 F.2d 492 (2d Cir.), cert. denied, 368 U.S. 820, 82 S.Ct. 36, 7 L.Ed.2d 25 (1961); Chandon Champagne Corp. v. San Marino Wine Corp., 335 F.2d 531 (2d Cir.1964); McDonald’s Corp. v. McBagel’s Inc., 649 F.Supp. 1268 (S.D.N.Y.1986).

These lists are not exhaustive or exclusive, and some of the factors may not always be relevant or equally emphasized in each case. However, they focus logically an inquiry that must be tailored to the factual circumstances of each case.

The circumstances of this case make for a specialized analysis. The offending mark has not been presented to the consuming public, except by way of announcement and trade shows. The product will not directly compete with any of the products of McDonald’s. And McDonald’s is not asserting a single mark but a family of marks.

The Court will therefore address in addition to the strength of the marks, which the Court has considered at length and determined to be especially important to any conclusion, the following: (1) the evidence of confusion; (2) the similarity of the contexts of uses of the marks such as the logo forms in which they are presented, the similarity of facilities on which they are used, the media forms in which they are used, and any other language or logos which might distinguish them or make them more similar; (3) the proximity of the markets for the products and services identified by the marks, and the likelihood that the gap between the markets will be bridged; and (4) the intent of the junior user in adopting his mark and his good faith in doing so.

Evidence of Confusion

With the announcement of McSleep Inn, the questions from the press and the industry as to whether Quality International would be infringing on the marks of McDonald’s were instantaneous. The message directed to Quality International by reporters and potential customers was “what will McDonald’s think?” The association was immediate and unambiguous.

When officers and employees of Quality International first became aware of the new product and name, they raised the same questions. Mr. Mosser, the franchising vice-president, was aware of the risk. Ms. Dynerman, the public relations director, expressed concern. The employees of Quality International verbalized their concern that the name sounds like McDonald’s. The concern was that even if McDonald’s was not affiliated with Quality International, perhaps a perception could reasonably be entertained that McDonald’s and Quality International were somehow together in the McSleep Inns venture so that McDonald’s reputation would be on the line.

It is true that mere association may not amount to confusion. It is one thing to say that a use brings McDonald’s to mind, but without confusion that McDonald’s is behind the product or service, and quite another to conclude that an appreciable number of typical consumers are likely to become actually confused. In the former case, there will be no trademark violation since trademark law does not pro*218tect words alone. Unlike a copyright, mere reproduction of a trademark is not an infringement. Thus, a non-confusing parody of a famous mark (“Jordache” vs. “Lardashe”) would not be trademark infringement because the owner of the mark “does not own in gross the penumbral customer awareness of its name, nor the fallout from its advertising.” Jordache Enterprises, Inc. v. Hogg Wyld, Ltd., 625 F.Supp. 48, 56 (D.N.M.1985), aff'd, 828 F.2d 1482 (10th Cir.1987). As Justice Holmes said:

[W]hat new rights does the trademark confer? It does not confer a right to prohibit the use of the word or words. It is not a copyright____ A trademark only gives the right to prohibit the use of it so far as to protect the owner’s goodwill against the sale of another’s product as his____ When the mark is used in a way that does not deceive the public we see no such sanctity in the word as to prevent its being used to tell the truth. It is not taboo.

Prestonettes, Inc. v. Coty, 264 U.S. 359, 360, 44 S.Ct. 350, 350, 68 L.Ed. 731 (1924) (citations omitted); see also University of Notre Dame Du Lac v. J.C. Gourmet Food Imports Co., Inc., 703 F.2d 1372 (Fed.Cir. 1983); American Footwear Corp. v. General Footwear Co., 609 F.2d 655 (2d Cir. 1979), cert. denied, 445 U.S. 951, 100 S.Ct. 1601, 63 L.Ed.2d 787 (1980).

It can be argued persuasively, however, that in this case the level of association reaches a level so great that confusion is likely to result. The question could well be asked: “With so much suggestion of or association with McDonald’s, could it be true that perhaps McDonald’s is a sponsor of McSleep Inns?”

The question whether a “likelihood of confusion” exists is, however, answered most persuasively by the survey evidence presented at trial. Although none of the surveys was perfect, they all spoke consistently that an appreciable number of consumers would be confused.

In Dr. Zeisel’s telephonic survey, the responses were closest to a statistical sample. Its greatest shortcoming was that perhaps the first question, which allowed the respondent to associate, brought McDonald’s to mind and therefore provided fuel for the next question as to who owns or sponsors McSleep Inn. The fear of any poison from that methodology, however, was allayed by his second survey which produced almost the same results. It is also noted that Dr. Zeisel conducted surveys, which he used as control for the research here, with the names “McTravel” and a concocted name “McTavish.” With respect to McTravel (using “Me” plus a generic word), confusion with McDonald’s resulted, but with respect to McTavish (using what appears to be a proper name), there was virtually no confusion. In both Dr. Zeisel used the same warm-up question as he did in the telephone survey.

Because the telephonic survey could not present visual depictions of the mark, Dr. Zeisel did a mall intercept survey. That type of survey traditionally does not have a statistical probability because as a practical matter it is focused on randomly sampled shopping malls which are inherently biased. Both experts used this method, however, and the testimony received indicated that it was a popular method for use in the marketing industry. This survey by Dr. Zeisel revealed the same level of confusion as did the telephone survey. Over 30 percent confused the name McSleep Inn with McDonald’s, a level which the Court concludes is substantial.

Projecting 30 percent to the 144 million people, which Dr. Zeisel concluded was the potential audience for McSleep Inn, over 40 million people would be expected to be confused if his surveys were statistically correct.

Dr. Jacoby, Quality International’s expert, criticized Dr. Zeisel’s leading question and the absence of visual stimuli. As the Court has noted, it concludes that at least the leading question criticism may have been theoretically correct, but it did not as a practical matter materially alter the data.

Dr. Jacoby conducted his own survey using as stimuli: an airline travel magazine advertisement for Quality International, a mock up yellow pages advertisement, and an artist’s rendering showing McSleep Inn *219with a clarifying sign underneath it which reads, “by Quality International.” The magazine advertisement was so diluted in its presentation, focusing principally on the Quality Inns range of products, that the Court concludes that it was not useful data to consider. Likewise, there was significant confusion relating to the yellow page advertising. In addition, the yellow page advertisement was under a display advertisement for Hilton Hotels leaving a significant number of respondents to relate the advertisement to Hilton Hotels. The Court does not consider the results of the surveys on these two stimuli as relevant.

The response to the question of who owns or sponsors MeSleep Inn as shown in the artist’s rendering was relevant. This was a depiction of what a MeSleep Inn would look like to a consumer and measures at least that response.

The Court accepts that data, however, with some reservations in view of the inclusion of the sign “by Quality International” prominently added under the MeSleep Inn logo. The issues in this lawsuit were framed around the use of the name MeSleep Inn and perhaps the use of MeSleep Inn’s logo that is subject to registration in the Patent and Trademark Office. In none of those usages is the qualifying language “by Quality International” included. Quality International contends, however, that since it will be using the qualifying words, they should be included in any inquiry. Nothing requires that “by Quality International” be included in every use of MeSleep Inn. The evidence showed that in fact individual franchisees of Quality International did not advertise the association with Quality International. Thus, a Comfort Inn franchisee would only advertise in brochures its own inn and the amenities offered there. Also, interstate and limited access highways that have signs advertising inns do not allow the qualifying language “by Quality International” on them. They would only allow the MeSleep Inn logo. The spoken or written use of MeSleep Inn would not always be able to include the limiting phrase.

The most troubling aspect of the survey using the limiting phrase, however, was the fact that over 70 percent of the respondents who correctly associated MeSleep Inn with Quality International did so because they were reading the qualifying language “by Quality International.” While that response may measure the particular stimulus which includes the logo with the qualifying language, it does not measure the confusion that is caused by the name MeSleep Inn or by the MeSleep Inn logo.

Notwithstanding these concerns with the Jacoby survey, it did measure the extent of confusion in response to that limited stimulus. Twenty-four of the 147 persons who understood that MeSleep Inn was being advertised, or 16.3 percent, said that McDonald’s was the owner or operator of the hotel, and if the survey is limited to persons who make the decision about where to stay when traveling, 21.4 percent believed that MeSleep Inn, even with the clarifying language, was owned or sponsored by McDonald’s. This is, in the Court’s judgment, the most indicting evidence on the likelihood of confusion. In the absence of the clarifying language, the evidence shows that the extent of confusion jumps significantly. Even the 16.3 percent is an appreciable number that cannot be dismissed.

Both experts acknowledged that there are inherent distortions in surveys which they call “noise.” But none estimated that the extent of this noise would ever rise above a few percentage points. Thus, the Court concludes that with the 16.3 percent minimum shown by the evidence, an appreciable number of consumers are likely to be confused by the use of the name MeSleep Inn, even with the qualifying language “by Quality International.”

Similarity of Contexts of Marks

Quality International urges the Court to compare visually the logos of the parties to assess on a visual basis the likelihood of confusion. It also directs the attention of the Court to the appearances of facilities and the differences of advertising, all factors listed by the Fourth Circuit in Pizzeria Uno Corp. v. Temple, supra, for *220consideration in determining the likelihood of confusion.

Based on the observation of the logos of the parties, pictures and renderings of the facilities, and the advertising utilized by the parties, the Court agrees that, in the absence of the name McSleep Inn, confusion is not likely to result. The logos of the parties are distinctive, as are the facilities. By looking at a rendering of a McSleep Inn facility one would not be confused into believing it was sponsored by or related to McDonald’s or its restaurants. The advertising of Quality International, moreover, focuses on the traveler and usually uses the print medium that confronts the traveler. On the other hand, McDonald’s primarily utilizes national television advertising.

Thus, although the Court agrees that the logos in design, color and shape, as well as the facilities, are not confusingly similar, it is the use of the name McSleep Inn that suggests an ownership, sponsorship, or association with McDonald’s.

The confusion caused by the name is not mitigated to an acceptable level by the distinctive uses of the logo, facilities and advertising. Even use of the clarifying language “by Quality International” and the substantial use of its corporate signature does not avoid the likelihood of confusion in this case. Quality International’s own survey evidence shows that even with all the mitigating factors, which were clearly depicted (more clearly than would be the case in real life) in a rendering of a McSleep Inn, still 16% to 20% of the public would continue to believe that it was sponsored by McDonald’s. Projected across the 144 million people who are considered to be the potential audience for McSleep Inn, well over 20 million would be likely to be confused. This is not an insubstantial number.

The Court concludes that the name McSleep is so similar to the McDonald’s family of marks that in whatever clothing it is dressed, the public will persist in perceiving some connection with McDonald’s. The marketing hook, as Mr. Hazard observed, is the name McSleep, which would be “instantly recognized.” So long as the word McSleep is used, the infringement occurs. This holding, however, would not preclude a name such as “Sleep-Inn,” for it is not the logo or the word “sleep” that causes the problem; it is the use of the fancifully coined word, McSleep.

Relatedness of Products

Quality International urges that marks in the lodging business cannot be confused with marks in the food business. This is not based on applicable legal principles and is not consistent with the demonstrated facts.

The evidence did show that Quality International’s McSleep Inns would not compete with a line of products sponsored by McDonald’s. There was no showing that McDonald’s was in the lodging business or that it planned to enter that market. It has developed a strategy to pursue the long-distance traveler and to promote plazas called McStop, but in each case, the purpose is and would be to promote its food business.

The evidence showed, however, that the fast food and the motel business were related. Some motels actually provide food in competition with fast food businesses which seem to spring up around motels. Quality International recognizes this relatedness in its own franchise agreement which prohibits its franchisees from using the name McSleep Inn or variation of it in the food business. Quality International’s other products, moreover, promote food and lodging together. The public has come to associate the two markets to such an extent that one would expect that McDonald’s has or would enter into this market. This was amply demonstrated by all the survey evidence in which an applicable number of the public would believe that a McSleep Inn was sponsored by McDonald’s.

Thus, while the Court does not consider it necessary to find the relatedness of markets, because the evidence of confusion builds in that perception by the public, the evidence is undisputed that lodging and fast foods are natural partners, as Mr. Hazard noted in the notes that he prepared *221for the meeting with McDonald’s in April 1987.

As noted earlier, the boundaries of enforceability of a mark are defined by where and in what markets an appreciable number of the public are confused. Here the confusion in a different, but related market, entitles McDonald’s to enforce its marks in that market.

Intent of Quality International

Intent of the infringing user to confuse is not necessary to establish a likelihood of confusion. On the other hand, the existence of an intent to confuse is “strong evidence establishing likelihood of confusion, since one intending to profit from another’s reputation generally attempts to make his signs, advertisements, etc., to resemble the other’s so as deliberately to induce confusion.” Pizzeria Uno, 747 F.2d at 1535. And an intentional infringement will entitle a plaintiff to an injunction; the defendant has no equity to object to one. Safeway Stores, Inc. v. Dunnell, 172 F.2d 649 (9th Cir.), cert, denied, 337 U.S. 907, 69 S.Ct. 1049, 93 L.Ed. 1719 (1949); Aunt Jemima Mills Co. v. Rigney & Co., 247 F. 407 (2d Cir.1917), cert. denied, 245 U.S. 672, 38 S.Ct. 222, 62 L.Ed. 540 (1917); Travelodge Corp. v. Siragusa, 228 F.Supp. 238 (N.D.Ala.1964), aff'd, 352 F.2d 516 (5th Cir.1965).

The intent to trade on the goodwill or reputation of another projects as does a missile to its target. In the absence of evidence of actual confusion, a Court may conclude, therefore, that the intended infringement would hit its target; certainly the infringer should not be the one to complain that it did not.

The Court finds that Mr. Hazard hoped that Quality International would become the “McDonald’s of lodging.” He believed, though mistakenly, that because he was in the lodging business and McDonald’s was in the fast food business, he was free to borrow, and expected that the confusion that would result would benefit his product. He wanted instant recognition, an image of consistency, quality, and value, all at the courtesy of McDonald’s.

There is a universe of names to select from and he combined “Me” plus the generic word “sleep,” a combination that he knew McDonald’s invented and which had no meaning except to associate a product or service with McDonald’s. Despite his protestations, which the Court concludes were too vigorous, the Court finds that Mr. Hazard had McDonald’s in mind in the selection of the name and planned to use the name as the marketing hook — a reputation instantly understood by the public and a prophesy which Quality International intended to fulfill.

Perhaps he had a good faith belief he could use the name legally and truly intended, after adopting it, to try to distinguish it from McDonald’s. But its use was not available.

While the intent of Mr. Hazard in the selection and adoption of the name was deliberate, the Court believes that he and his staff believed that the use could be defended, albeit with a tainted understanding of their rights. Quality International knew of the risk but elected to proceed. Perhaps the initiation of this suit so promptly was the ultimate recognition of the risk.

XI. CONCLUSIONS

For the reasons given the Court finds and concludes that (1) McDonald’s is entitled to enforce its family of marks that are characterized by the combination of the prefix “Me” with a generic word; (2) the name McSleep Inn is likely to cause an appreciable number of the public to be confused by believing that McSleep Inn is sponsored, associated, affiliated, connected, or endorsed by McDonald’s; and (3) the adoption and use by Quality International of the name McSleep Inn was a deliberate attempt to benefit by the good will and reputation of McDonald’s. Therefore, the Court will find trademark infringement, unfair competition, and dilution under the Illinois statute (Ill.Rev.Stat. Ch. 140, § 22).

XII. RELIEF

On the Court’s finding of trademark infringement and unfair competition, it will *222enter a permanent injunction in this case. Courts have a wide range of discretion in framing injunctions. Spring Mills, Inc. v. Ultracashmere House, Ltd,., 724 F.2d 352 (2d Cir.1983). In AMF, Inc. v. Sleekcraft Boats, 599 F.2d 341 (9th Cir.1979), the defendant was allowed to continue use of its contested mark but only in connection with its own distinctive house mark or logo. In other cases, courts have determined that some form of disclaimer of association is sufficient to preclude likely confusion. See, e.g. Mushroom Makers, Inc. v. R.G. Barry Corp., 441 F.Supp. 1220 (S.D.N.Y. 1977), aff'd, 580 F.2d 44 (2d Cir.1978) (junior user must prominently display statement that it does not make shoes or that it is not associated with senior user), cert. denied, 439 U.S. 1116, 99 S.Ct. 1022, 59 L.Ed.2d 75 (1979).

In this case, however, Quality International attempted before trial to avoid confusion by the very restrictions a court might consider appropriate. The evidence demonstrated that any such restrictions would not suffice to avoid confusion. Accordingly, the injunction will without qualification prohibit Quality International from using the name “McSleep” as a mark or as part of a mark.

To give effect to the injunction, the Court will require Quality International to advise its franchises of this injunction and to require them to refrain from using the name “McSleep” as a mark or as part of a mark.

Finally, the Court will require Quality International to report to the Court within 30 days that it has complied with the injunction.

McDonald’s has asked that this Court find that the circumstances of this case are “exceptional” as that term is used in 15 U.S.C. § 1117 and therefore award it attorney's fees. When this provision for attorney’s fees was added to the Lanham Act in 1975, Congress intended it to be applied where the acts of infringement can be characterized as unconscionable, malicious, fraudulent, deliberate or willful. S.Rep. No. 93-1400, 93rd Cong., 2d Sess. (1974), 1974 U.S.Code Cong. & Admin. News 7132, 7133 (1975); Five Platters, Inc. v. Purdie, 419 F.Supp. 372 (D.Md.1976). Some cases have viewed this as requiring some form of fraudulent conduct of the type that is inherent in counterfeiting or “palming off.” Armstrong Cork Co. v. Armstrong Plastic Covers Co., 434 F.Supp. 860 (E.D.Mo.1977); Playboy Enterprises, Inc. v. Baccarat Clothing Co., 692 F.2d 1272 (9th Cir.1982). Others have noted that the conduct need only be deliberate and willful. Quaker State Oil Refining Co. v. Kooltone, Inc., 649 F.2d 94 (2d Cir.1981). In any case, it is an issue of discretion based on all the circumstances.

In this case no evidence was presented that McDonald’s sustained any damage. Quality International pursued this action promptly, before it opened its first McSleep Inn, to resolve the cloud over the name which it incorrectly perceived it could use. It is true that the Court concluded that Quality International’s selection of the name was a deliberate attempt to trade on the good will and reputation of McDonald’s. But Mr. Hazard, who selected the name, believed that it was defensible because of the non-competing products and services with which the marks would be used. Most importantly, however, Quality International did not at any time seek to conceal its sponsorship of McSleep Inn. Its first announcement began with the statement that Quality Internationa] was introducing the new line of hotels.

For these reasons, the Court determines that this case is not “exceptional” as that term is used in 15 U.S.C. § 1117, and it will deny the request for attorney’s fees.

A separate order will be entered consistent with this opinion.

INJUNCTION AND ORDER

For the reasons given in the Opinion issued this date, it is hereby ORDERED this 16th day of September, 1988, by the United States District Court for the District of Maryland, that:

1. Quality Inns International, Inc., its officers, directors, and agents are permanently prohibited and enjoined from using *223the name “McSleep” as a trademark or service mark or as part of such a mark or in any other commercial manner;

2. Quality Inns International, Inc. is directed to advise each franchisee of McSleep Inn of the terms of this Order and shall require the franchisee to refrain from using the name “McSleep” as a trademark or service mark or as part of such a mark or in any other commercial manner;

3. Quality Inns International, Inc. shall, within thirty days from the date of this Order, file a report with the Court, with a copy to McDonald’s Corporation, setting forth the manner in which it has complied with the terms of this Order;

4. The request of McDonald’s Corporation for attorney’s fees pursuant to 15 U.S. C. § 1117 is denied;

5. Costs of this action shall be paid by Quality Inns International, Inc.

14.5 Attrezzi, LLC v. Maytag Corp. 14.5 Attrezzi, LLC v. Maytag Corp.

14 (12)

ATTREZZI, LLC, Plaintiff, Appellee/Cross-Appellant, v. MAYTAG CORPORATION, Defendant, Appellant/Cross-Appellee.

Nos. 05-2098, 05-2181.

United States Court of Appeals, First Circuit.

Heard Nov. 10, 2005.

Decided Jan. 27, 2006.

*35Edward A. Haffer with whom Sheehan Phinney Bass & Green, P.A. was on brief for defendant.

James G. Goggin with whom Peter S. Black and Verrill Dana, LLP were on brief for plaintiff.

Before BOUDIN, Chief Judge, SELYA, Circuit Judge, and STAHL, Senior Circuit Judge.

BOUDIN, Chief Judge.

Attrezzi, LLC (“Attrezzi LLC”), a New Hampshire limited liability company, operates a single retail store of the same name in Portsmouth, New Hampshire, specializing in fine kitchen products and services. The proprietor, Jennifer Slade, opened her shop’s doors in June 2002, and at the same time launched a website (www.attrez-zinh.com) to support an anticipated mail-order business. Slade obtained a New Hampshire trademark registration for “At-trezzi” in November 2003.

Maytag, a well-known appliance maker, selected the same word, “Attrezzi,” in the spring of 2003 as the name for a new line of small electric kitchen appliances that Maytag was preparing to launch. Attrezzi LLC’s line of products includes such appliances although it does not carry Maytag’s products. Before launching its line, Maytag learned through the customary trademark investigation that Attrezzi LLC was using the term for its business, and Maytag’s in-house trademark counsel warned that this created “a problem.”

After higher management asked its in-house counsel to “take another look,” counsel reversed his position, and in March 2003 Maytag filed an “intent-to-use” application with the Patent and Trademark Office (“PTO”) to register Attrezzi as its trademark for small electric appliances. The next month Maytag began to promote the name as a sub-brand of “Jenn-Air,” its “high-end house mark”; it announced that its “Jenn-Air Attrezzi” line would include small electric kitchen appliances and might extend to “our own coffee, [b]ar ware, cups, glasses, [and] cutlery.”

The PTO eventually approved Maytag’s application (subject to opposition) and gave public notice of this action. Attrezzi LLC wrote to Maytag complaining of Maytag’s use of the term Attrezzi and filed a “use” service mark application of its own, with the PTO, to register the term for retail store and online use for the sale of kitchen and dining goods. Maytag responded to Attrezzi LLC that there was no likelihood of customers confusing the source of Jenn-Air Attrezzi branded products with the Attrezzi store.

In turn, Attrezzi LLC filed suit, in October 2003, in federal district court in New Hampshire, charging Maytag with violating the unfair competition provision of the Lanham Act, 15 U.S.C. § 1125(a) (2000),1 *36and New Hampshire’s trademark infringement, unfair competition, and trademark dilution statutes, N.H.Rev.Stat. Ann. §§ 350-A11-14, 358-A2, 350-A12 (1995 & Supp.2005). Attrezzi LLC requested a jury trial and sought declaratory relief, a permanent injunction against the use of the term Attrezzi, and enhanced damages, attorneys’ fees and costs.

Prior to trial, the district court denied Attrezzi LLC’s motion for a preliminary injunction and Maytag’s motion for summary judgment. It also denied Maytag’s motion to strike Attrezzi LLC’s jury demand, reserving the question until “after the case has been completed,” at which point, “[i]f [the court] determine^] that plaintiff does not have a right to a jury trial, [it] w[ould] treat the jury’s verdict as advisory pursuant to Fed.R.Civ.P. 39(c).” In the meantime, in September 2004, At-trezzi LLC filed an opposition before the PTO to Maytag’s application to register Attrezzi.

After a five-day trial in February 2005, the jury found Maytag to have willfully infringed Attrezzi LLC’s trademark and to have caused damages of $5,400 (the cost of Attrezzi LLC’s opposition to Maytag’s application before the PTO). After post-trial proceedings, the district court granted a permanent injunction against Maytag’s use of the mark Attrezzi (but allowed it a 12-month period to sell off stock so marked) and awarded double damages ($10,800) and attorneys’ fees.

Maytag now appeals from the judgment against it. Attrezzi LLC cross-appeals, opposing the 12-month sell-off period and the denial of certain litigation expenses. This court granted unopposed motions for a stay of the injunction pending appeal and for expedited consideration of the appeals. We begin with Maytag’s claims of error— that there was no right to a jury trial; that even if there were, the evidence did not permit findings necessary to liability; and that the provision of the New Hampshire statute providing for the award of attorneys’ fees and enhanced damages is preempted by the Lanham Act.

The jury trial issue deserves attention first because, in its post-trial proceedings, the district judge said that in a bench trial, he would have decided the case in Maytag’s favor. His reason was that, if he were the trier of fact, he would have found the evidence insufficient in the present circumstances to establish a likelihood of customer confusion as between Attrezzi and Jenn-Air Attrezzi. Had the jury trial been disallowed, we would be reviewing the evidence from the opposite perspective.

Maytag made a timely objection to a jury trial, which it renewed in its motions for judgment as a matter of law. Its main argument was that the injunctive action was equitable and that no evidence supported a claim for damages. An infringement claim for damages is a common-law rather than an equitable claim and such a claim would be triable to a jury even if joined, as here, with a request for equitable relief. Beacon Theatres, Inc. v. Westover, 359 U.S. 500, 508-11, 79 S.Ct. 948, 3 L.Ed.2d 988 (1959).

Here, Maytag’s attack is solely on the sufficiency of the evidence presented at trial to show monetary damages. We are thus spared any consideration of how matters stood at the pleading and summary judgment stages. Compare Laskar- *37 is v. Thornburgh, 733 F.2d 260, 264 (3d Cir.), cert. denied, 469 U.S. 886, 105 S.Ct. 260, 83 L.Ed.2d 196 (1984), with Hildebrand, v. Bd. of Trs. of Mich. State Univ., 607 F.2d 705, 709-10 (6th Cir.1979).

Since the jury in this case found, damages, Maytag’s attack must fail unless “reasonable persons could not have reached the conclusion that the jury embraced.” Sanchez v. P.R. Oil Co., 37 F.3d 712, 716 (1st Cir.1994). As we have said elsewhere, the test “is a stringent one”:

“[W]e must examine the evidence in the light most favorable to the plaintiff and determine whether there are facts and inferences reasonably drawn from those facts which lead to but one conclusion— that there is a total failure of evidence to prove plaintiffs case.” Mayo v. Schooner Capital Corp., 825 F.2d 566, 568 (1st Cir.1987) (quotation and citation omitted). In reviewing the record, we will evaluate neither the credibility of the witnesses nor the weight of the evidence. Santiago-Negron v. Castro-Da-vila, 865 F.2d 431, 445 (1st Cir.1989).

Vázquez-Valentín v. Santiago-Díaz, 385 F.3d 23, 29 (1st Cir.2004), petition for cert. filed, 73 U.S.L.W. 3604 (U.S. Feb. 11, 2005) (No. 04-1322).

In this instance, Maytag argues that there was never any basis for Attrezzi LLC’s claim of monetary damages because Attrezzi LLC introduced no evidence of lost profits or damage to its goodwill. And, although Attrezzi LLC did claim and obtained damages reflecting the expense of opposing Maytag’s PTO application, Maytag says that this expense was unrecoverable because full relief including an injunction could have been granted by the district court, making it unnecessary for Attrezzi LLC to oppose Maytag’s PTO application.2

It is true as a general matter that a patently unnecessary expense would be avoidable damage and so not collectible. See Restatement (Second) of Torts § 918 (1979). Maytag argues that the opposition was unnecessary because the district court could have granted injunctive relief. However, fearing the repercussions of a PTO grant for the infringement claim in district court, a competent lawyer could sensibly oppose Maytag’s PTO application. It is a matter of reasonable judgment whether the precaution was legitimate; nothing indicates that Attrezzi LLC’s choice was unreasonable.

This brings us to the central issue on the appeal, namely, Maytag’s claim that at trial there was insufficient evidence of a protectable mark and of likely customer confusion to permit a verdict for Attrezzi LLC. Although our review of the district court’s rejection of the Rule 50(b) motions is de novo, the question is whether any rational jury could have found for Attrezzi LLC on the evidence presented. Sanchez, 37 F.3d at 716.

Under governing case law, a trade name is safeguarded by the Lanham Act only if the mark is “distinctive,” a term of art meaning that the mark must be arbitrary or “suggestive” or, if merely “descriptive,” must have acquired “secondary meaning.”3 An arbitrary or suggestive *38term, being “inherently distinctive,” can be appropriated by a first user, while a descriptive term is subject to such appropriation “only if it has acquired ‘secondary meaning’ by which consumers associate it with a particular producer or source.” Boston Beer Co. Ltd. P’ship v. Slesar Bros. Brewing Co., 9 F.3d 175, 180 (1st Cir. 1993).

The jury found specially that Attrezzi LLC’s use of the name Attrezzi for its goods was a suggestive, rather than a descriptive use, and that in any event the name had acquired secondary meaning. Both findings are treated as determinations of fact, Boston Beer, 9 F.3d at 180, and it is enough to qualify the name for protection if either one is established. Here, a rational jury could find the Attrez-zi mark, as used to identify a service selling kitchen appliances, utensils, and dinnerware, to be suggestive.

Under the “doctrine of foreign equivalents,” a foreign word is ordinarily translated into English to determine whether it is suggestive or descriptive. See, e.g., Pizzeria Uno Corp. v. Temple, 747 F.2d 1522, 1531-32 (4th Cir.1984); see also 2 McCarthy, McCarthy on Trademarks and Unfair Competition § 11:34, at 11-66 (4th ed.2005). The district court so charged the jury and neither side contests the instruction. Attrezzi is an Italian word meaning “tools.” Maytag argues that the term is merely descriptive, as it relates to Attrezzi LLC’s business, which consists of selling, among other things, “chefs tools.”

But Attrezzi translates as “tools,” not “chefs tools”; as applied to kitchen implements and appliances, the term can easily be viewed as suggesting a similarity, not an identity, between ordinary workman’s tools and electrical appliances or the like used by a chef. It does not help Maytag that the PTO had originally balked at Maytag’s own application and then given way when Maytag urged the PTO that Attrezzi was suggestive rather than descriptive as applied to Maytag’s kitchen appliances.

Alternatively, Maytag argues that the evidence did not permit a rational jury to find “likelihood of confusion,” as required for trademark infringement and unfair competition actions. The precise showing is proof “that the allegedly infringing conduct” — here, Maytag’s use of the mark Attrezzi — “carries with it a likelihood of confounding an appreciable number of reasonably prudent purchasers exercising ordinary care.” Int’l Ass’n of Machinists & Aerospace Workers, AFL-CIO v. Winship Green Nursing Ctr., 103 F.3d 196, 201 (1st Cir.1996). The question of confusion of non-customers, Beacon Mut. Ins. Co. v. OneBeacon Ins. Group, 376 F.3d 8, 16 (1st Cir.2004), is not at issue here.

Attrezzi LLC did not advance an ordinary confusion claim, i.e., one in which the claimant asserts that the infringer is diverting the claimant’s customers and free-riding on the claimant’s reputation and goodwill. Rather, its claim was one of “reverse” confusion, by which Attrezzi LLC might be harmed by purchasers mis-perceiving that Maytag — because of its use of the term Attrezzi in its own advertising — was the source or sponsor of Attrezzi LLC’s goods and services. See DeCosta v. Viacom Int’l, Inc., 981 F.2d 602, 608 (1st Cir.1992) (endorsing the reverse confusion *39concept), cert. denied, 509 U.S. 923, 113 S.Ct. 3039, 125 L.Ed.2d 725 (1993).

In such a case, damage can result either because current or prospective customers of the claimant associate the claimant’s product with an inferior product offered by the infringer, or because the latter’s use of the mark “saturates the market and ‘overwhelms the senior user,’ ” such that “ ‘the senior user loses the value of the trademark, its product identity, corporate identity, control over its goodwill and reputation, and ability to move into new markets.’ ” 3 McCarthy, supra, § 23:10, at 23-36 (quoting Ameritech, Inc. v. Am. Info. Techs. Corp., 811 F.2d 960, 964 (6th Cir.1987)). Attrezzi LLC in fact argued at trial that difficulties with Maytag’s Attrezzi-branded products — whether the complaints were atypical goes only to degree — were acknowledged internally within Maytag and reinforced the danger that Attrezzi LLC might be tarred with the same brush to the extent that confusion existed.

Whatever the source or extent of such damage, the requirement of likely confusion is common both to the ordinary “forward” confusion claim and the “reverse” confusion variant urged in this case. In assessing confusion, this circuit has resorted to the consultation of a series of factors rather than any mechanical formula. A representative list includes:

(1) the similarity of the marks; (2) the similarity of the goods (or, in a service mark case, the services); (3) the relationship between the parties’ channels of trade; (4) the juxtaposition of their advertising; (5) the classes of prospective purchasers; (6) the evidence of actual confusion; (7) the defendant’s intent in adopting its allegedly infringing mark; and (8) the strength of the plaintiffs mark.

Winship Green, 103 F.3d at 201; see also Pignons S.A. de Mecanique de Precision v. Polaroid Corp., 657 F.2d 482, 487 (1st Cir.1981).

Here, both sides have points in their favor. Both use the word Attrezzi and to this extent the marks are identical rather than merely similar. On the other hand, Maytag uses the word only in conjunction with the term Jenn-Air (i.e., Jenn-Air At-trezzi), which could help diminish the chance of confusion. See Pignons, 657 F.2d at 487. Yet since the alleged harm is reverse confusion, to the extent Jenn-Air is itself the more recognized label the linkage could actually aggravate the threat to Attrezzi LLC. A & H Sportswear, Inc. v. Victoria’s Secret Stores, Inc., 237 F.3d 198, 230 (3d Cir.2000).

Turning to the overlap of products, Maytag fairly points out that its Jenn-Air Attrezzi products are appliances while Attrezzi LLC uses the Attrezzi term to represent its entire retail business. But Attrezzi LLC itself sells small electric appliances alongside its gourmet foods and dinnerware. This is not a case in which two products are so dissimilar as to make confusion highly unlikely; and the more similar the marks are, the less necessary it is that the products themselves be very similar to create confusion. 3 McCarthy, supra, § 23:20.1, at 23-73 to 23-74 & nn. 1-2 (collecting eases).

Channels of trade, advertising modes, and prospective customers — a set of factors often considered together, see Win-ship Green, 103 F.3d at 204 — also cut both ways. Maytag is a national manufacturer selling through stores and catalogues while Attrezzi LLC operates a single retail store engaged in local sales. But both use websites — Attrezzi LLC has customers in many states — and searches using the terms Attrezzi or Jenn-Air Attrezzi turn up both companies’ websites. Both parties *40aim at basically the same high-end customers, a point in favor of Attrezzi LLC, but conceivably customer sophistication could also ameliorate confusion, Pignons, 657 F.2d at 489.

Attrezzi LLC’s evidence of actual confusion, often deemed the best evidence of possible future confusion, Beacon Mut., 376 F.3d at 18, is limited but real: eight emails mistakenly sent to it rather than Maytag through Attrezzi LLC’s website (complaining of problems with Jenn-Air Attrezzi products); testimony that the New Hampshire store had received a dozen or so calls intended for Maytag; and written declarations from two Attrezzi LLC customers that they had been confused — for example:

I thought that Maytag operated Attrezzi as one of a chain of retail shops. Part of the reason for this belief is the distinctiveness of the Attrezzi name. I figured that because both companies were using the same name in the kitchen products market, they must be related.

The “good faith” of the alleged infringer is yet another factor. Here, although Maytag offered an innocent explanation for disregarding the initial advice of its in-house counsel, the jury seemingly concluded in its willfulness finding that Maytag was well aware of a substantial risk of confusion and nonetheless decided to gamble. On the other hand, there is some distance in a case like this one between a company’s knowing decision to risk a law suit and a factual inference that customer confusion is likely.

Finally, the respective strengths of the junior and senior marks — in a nutshell, their respective renown — are regarded as relevant. Attrezzi LLC offered some evidence of regional success, showing that its retail business “has been mentioned or featured” in publications such as the Boston Globe and Accent Magazine, and that it received an award from Business NH magazine in 2003 for its Attrezzi branding campaign. Maytag showed large national expenditures to promote Jenn-Air Attrez-zi; yet in a reverse confusion case, the relatively greater strength of a junior user like Maytag may hurt, rather than help, its defense. See A & H Sportswear, 237 F.3d at 230-31.

Maytag appears to argue on appeal that because the Attrezzi mark was suggestive rather than arbitrary, it was therefore inherently weak. This is not a proposition supported by any First Circuit case law and its logic is not apparent to us. The factors commonly considered as to strength — e.g., wide recognition, efforts to promote, see Beacon Mut., 376 F.3d at 19 — are concerned with practical matters and not the legal classification of the mark.

In sum, this is not a clear-cut case as to confusion. Perhaps, like the district judge, we might as factfinders have come out the other way, but we see no way to describe the jury’s liability verdict as irrational. Civil juries have their benefits and their risks. Nor is there any hint of a strongly partisan jury in this case: in the end, no vast damages were awarded; Maytag will simply have to find another word than Attrezzi to couple to its Jenn-Air brand.

Maytag’s final argument — attacking the award of attorneys’ fees and double damages — rests on the fact that the federal statute provides for attorneys’ fees only “in exceptional cases,” and permits the court in its discretion to award enhanced damages “subject to principles of equity.” 15 U.S.C. § 1117(a). New Hampshire, by contrast, provides attorneys’ fees as a matter of course and only to plaintiffs, and offers enhanced damages automatically upon a showing that the violation was will*41ful or knowing. N.H.Rev.Stat;. Ann. § 358-A:10.

Maytag’s argument is that the federal statute ought to be treated as preempting the deviating state rule as to attorneys’ fees and enhanced damages. Attrezzi LLC says that Maytag forfeited this argument by waiting until after trial to make it; but both attorneys’ fees and enhancement of damages are decided by the judge rather than the jury, see Carter v. Lachance, 146 N.H. 11, 766 A.2d 717, 719 (2001), and Maytag made the preemption-of-remedy argument at the appropriate time, namely, when the district court was asked to make the awards.

The Lanham Act does not say expressly that it preempts state unfair competition law as to attorneys’ fees or enhanced damages, but Maytag argues that two theories of implied preemption govern in this case: preemption of the “field” and so-called “conflict” preemption:

When Congress intends federal law to “occupy the field,” state law in that area is preempted.... [Preemption also occurs] where it is impossible for a private party to comply with both state and federal law, and where “under the circumstances of [a] particular case, [the challenged state law] stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.”

Crosby v. Nat’l Foreign Trade Council, 530 U.S. 363, 372-73, 120 S.Ct. 2288, 147 L.Ed.2d 352 (2000) (citations omitted). Our review is de novo. Hotz v. Blue Cross & Blue Shield of Mass., Inc., 292 F.3d 57, 59 (1st Cir.2002).

It is settled that the Lanham Act does not in general preclude state unfair competition statutes from operating, see Keebler Co. v. Rovira Biscuit Corp., 624 F.2d 366, 372 & n. 3 (1st Cir.1980), so “field” preemption is a dubious argument. Indeed, it is common practice for federal and state statutes to operate in the same field—anti-discrimination laws are a classic example—even though their terms may be somewhat different and state law may be more favorable to the plaintiff. See, e.g., Dichner v. Liberty Travel, 141 F.3d 24, 30-31 (1st Cir.1998).

Thus, conflict preemption is the more apt rubric. Because there is no issue here of inconsistent commands to a party, the question is whether New Hampshire’s laxer standard for an award of attorneys’ fees or its mandatory award of enhanced damages undermines the policy of the federal statute. New Hampshire, of course, has adopted a remedial policy different from Congress’ own, but it has done so with respect to its own statutory cause of action and not that provided by the Lanham Act.

The New Hampshire statute does create a stronger incentive for plaintiffs to bring unfair competition suits against trademark infringers by making attorneys’ fees for the plaintiffs automatic on success and by enhancing damages more readily than under the federal statute. Congress’ use of a less favorable incentive structure for federal suits was deliberate: enhanced damages were from the outset left to the judge’s discretion, and when Congress amended the Lanham Act in 1975 to permit attorneys’ fees, Pub.L. No. 93-600, 88 Stat.1955 (1975), it deliberately made them discretionary and evenhandedly available to both sides.4

*42But it is accepted that Congress did not prohibit state unfair competition statutes that might have substantive terms somewhat more favorable to plaintiffs than the Lanham Act. See Keebler, 624 F.2d at 372 n. 3. That is apparently not true of New Hampshire’s statute in this case—at least, neither party has argued as much— but it is not unusual in other types of protective statutes. See, e.g., Coady Corp. v. Toyota Motor Distribs., Inc., 361 F.3d 50 (1st Cir.2004). In this sense, to complain in this case about the modest deviation in remedial benefits favorable to plaintiffs is to swallow the camel but strain at the gnat.

Admittedly, trademark protection has great potential to affect interstate commerce, as this case illustrates (e.g., both parties’ use of the internet, and Maytag’s national advertising). Excessive protection—even if not biased in favor of local residents—can compromise interstate commerce just as easily as inadequate protection. The concerns here are perhaps greater than in cases where state law provides more protection than federal law against local employment discrimination or supposed abuse of local dealers by national car makers.

Nevertheless, Congress has not instituted a full-scale federal regulatory scheme, like the Clean Water Act’s discharge permitting regulations in Int’l Paper Co. v. Ouellette, 479 U.S. 481, 494-97, 107 S.Ct. 805, 93 L.Ed.2d 883 (1987); or created an intricate and targeted sanctions regime against a foreign government in “a deliberate effort to steer a middle path,” as in Crosby, 530 U.S. at 377-80, 120 S.Ct. 2288; or instituted “uniform national standards,” as for automobile safety in Wood v. General Motors Corp., 865 F.2d 395, 412 (1st Cir.1988), cert. denied, 494 U.S. 1065, 110 S.Ct. 1781, 108 L.Ed.2d 782 (1990). In all these cases, state deviations, including attempts to provide greater protection for putative plaintiffs, were deemed to upset a carefully constructed regulatory compromise.

By contrast, the Lanham Act primarily provides a federal forum for what is in substance a traditional common-law claim. If state substantive regimes are (ordinarily) not preempted by the Lanham Act, neither is New Hampshire’s tinkering with the remedial components. The only other circuit case cited to us on this issue agrees with this view. Tonka Corp. v. Tonk-A-Phone, Inc., 805 F.2d 793, 794-95 (8th Cir.1986); cf. Brunswick Corp. v. Spinit Reel Co., 832 F.2d 513, 527-29 (10th Cir.1987) (assuming validity of separate attorneys’ fee rules under state deceptive trade practices statute).

We turn now to Attrezzi LLC’s cross-appeal. The company first urges that the district judge erred in allowing Maytag a 12-month sell-off period for any existing stock bearing the Jenn-Air At-trezzi mark. Review is for abuse of discretion, Anderson ex rel. Dowd v. City of Boston, 375 F.3d 71, 91 (1st Cir.2004), and there is obviously a rationale for avoiding the wastefulness of renaming or junking existing stock—especially where diversion of sales from the plaintiff is unlikely.

Attrezzi LLC urges that it was unreasonable for the district judge to give any latitude to an infringer who had been found by the jury to have acted willfully, and it cites a couple of decisions that have denied sell-off periods to willful infringers. E.g., Berkshire Fashions, Inc. v. Sara Lee Corp., 729 F.Supp. 21, 21-22 (S.D.N.Y.1990). We assume, as he did himself, that *43the district judge was obliged to accept the jury’s finding of willfulness in deciding what equitable relief to grant.5

The jury instructions permitted the jury to base its willfulness finding on “deliberate indifference”; so the jury finding, in light of the evidence, is certainly compatible with a decision by Maytag to take a deliberate risk in what it thought was a debatable case. Maytag is paying a stiff price in wasted advertising expenses; there is no indication that the risk of harm to Attrezzi LLC’s service mark is likely to increase appreciably because of the additional 12 months of Maytag’s competing use; and we think that the district judge acted within his discretion.

Attrezzi LLC’s other main claim on its cross-appeal is that the district court failed to award it the proper amount of “the costs of the suit and reasonable attorney’s fees, as determined by the court” to which a prevailing party is entitled under the New Hampshire statute. N.H.Rev.Stat. Ann. § 358-A:10. In particular, Attrezzi LLC claims that it incurred litigation expenses, including for attorney travel {e.g., for depositions) and computer-assisted research, which it identified in its post-judgment submission but which were not awarded to it.

Attrezzi LLC did receive an award of the full amount of its time-based attorneys’ fees ($239,675.00), albeit without an upward adjustment it sought. It is unclear whether the district court intended to disallow the separate items now in issue, or overlooked them (Attrezzi LLC did not ask the court to reconsider on this ground), or thought they would be considered by the court clerk as part of an award of costs. Maytag suggests the latter, urging that an appeal on this issue is premature, but then says that these items are not recoverable costs anyway — citing federal practice.

True enough, expenses for items such as attorney travel and computer research are not deemed “costs” within the meaning of the federal statute that provides for recovery of costs by a prevailing party. 28 U.S.C. § 1920 (2000). But such items may be recovered where appropriate as part of attorneys’ fees under the typical federal fee-shifting statute. See, e.g., Invessys, Inc. v. McGraw-Hill Cos., 369 F.3d 16, 22-23 (1st Cir.2004) (interpreting the federal Copyright Act, 17 U.S.C. § 505 (2000)); Palmigiano v. Garahy, 707 F.2d 636, 637 (1st Cir.1983) (interpreting 42 U.S.C. § 1988 (2000)). No such federal statute applies here, but whether the New Hampshire statute covers such items, either as “costs” or as part of attorneys’ fees, is a matter that neither party has troubled to brief.

We think that the cleanest way to resolve the uncertainty is to affirm the district court’s judgment without prejudice to a prompt renewed request by Attrezzi LLC to the district court as to the omitted expense items. That court can say in the first instance whether it intends to award such costs and in what amount or whether it proposes to deny them and if so why. In addition, it can if it chooses obtain from the parties briefing on how New Hampshire’s statute may apply to such items, either as costs or as part of attorneys’ fees.

In closing, Attrezzi LLC also makes two other requests. One is for a “remand to *44award Attrezzi the amount of profits on the infringing sales that occurred since the trial.” The request, presented in a single sentence at the end of the section of its brief attacking the sell-off period and re-prised in a single sentence in the “Conclusion” paragraph, is not seriously presented and we do not consider it. Mass. Sch. of Law v. Am. Bar Ass’n, 142 F.3d 26, 43 (1st Cir.1998).

The other request is for “new attorneys’ fees and costs incurred in prosecuting this appeal.” A request for attorneys’ fees in this court should be presented by separate motion to us following our decision, stating the basis for the claim, the amount sought, supporting it through conventional records, and providing the legal basis for the award — to all of which the opponent may respond. Cf. Fed. R.App. P. 38; 1st Cir. R. 38.

The judgment of the district court is affirmed, but without prejudice to a prompt renewed request by Attrezzi LLC to the district court for the previously sought items of litigation expense and a new appeal by either side from that disposition if either side is dissatisfied with the resolution. We need not reserve jurisdiction; if such a new “clean-up” appeal is filed, our clerk should direct it to the present panel.

It is so ordered.