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Ninth Circuit:
Infringement Case Does Not Turn on Lack of a Hyphen
Panel Says Judge Erred in Deciding That Registered Trademark on ‘Candy-Gram’ Is Inapplicable Where Defendants Used the Word, ‘Candygram’; Burden Was Placed on Plaintiff to Disprove Genericness
By a MetNews Staff Writer
The Ninth U.S. Circuit Court of Appeals yesterday reversed a summary judgment in favor of defendants in a suit under the Lanham Act, holding that a District Court judge erred in finding that a registered trademark on “Candy-Gram” had no relevance in an infringement action against commercials users of the word “candygram” based on the lack of a hyphen.
Judges Jacqueline H. Nguyen and Milan D. Smith Jr. and Senior Circuit Judge Susan P. Graber comprised the panel that reinstated an action by Global Apogee against Joshua Resnick and Rosie O’Neill who, through their Inglewood-based company, Sugarfina, utilized the name “Candygram” on their website and in retain stores in connection with the sale of candy. Sugarfina was dismissed as a defendant on June 15, 2021, by Judge Ronald S.W. Lew (now deceased) after it went into bankruptcy.
Global Apogee registered its trademark in 1995. It covers candy and greeting cards.
District Court Decision
Philip S. Gutierrez of the Central District of California granted summary judgment in favor of the defendants. He said in his March 31, 2023 order:
“Given that the term at issue that Defendants used was ‘Candygram,’ which is not a federally registered mark, the burden of persuasion is on Plaintiff to prove that ‘Candygram’ is not generic.”
He declared:
“[T]he Court finds that Plaintiff has not met its burden of showing that ‘Candygram’ is not generic. Given this, Plaintiff cannot show that Defendants’ use of the term ‘Candygram’ could satisfy the likelihood of confusion element in its trademark infringement claim.”
Counterclaim Dismissed
He dismissed the defendants’ counterclaim for cancellation of the “Candy-Gram” mark, explaining:
“Given that Defendants’ generic use of the term “Candygram” does not create a likelihood of confusion or infringe on Plaintiff’s registered ‘Candy-Gram’ mark, Defendants cannot show that they are or will be damaged by the registration of Plaintiff’s mark.”
Arguing on appeal for an affirmance, the defendants said:
“Plaintiff presented absolutely no evidence below to meet its burden of persuasion to demonstrate that the term “candygram” was not generic. And Plaintiff has never cited to a single case that would relieve it of its burden to prove that the unregistered term “candygram” was not generic. Plaintiff tellingly does not even address, let alone mention, Defendants’ on-point case authority….”
Ninth Circuit Decision
Reversing, in part, the Ninth Circuit said:
“Because the complaint gave Defendants fair notice of Plaintiff’s claims, the district court erred by analyzing genericness based only on the term ‘Candygram’ rather than considering the federally registered trademark. This error led the district court to misallocate to Plaintiff, rather than to Defendants, the burden of proof for genericness….That error, in turn, tainted the court’s conclusion as to likelihood of confusion.
The judges added:
“With respect to the cross-appeal, Defendants’ counterclaim for cancellation of Plaintiff’s federally registered ‘CANDY-GRAM’ mark is revived. But Defendants’ counterclaim for a declaratory judgment is not revived, because it is merely duplicative.”
The judges also reinstated state claims Gutierrez had dismissed, saying:
“The court reasoned that those claims are substantially congruent with the federal claim which, as we held above, was analyzed incorrectly.”
The case is Global Apogee v. Sugarfina, Inc., 23-55410.
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