Tag Archives: Charbucks

Best of 2009: Char’ed, I’m sure

Originally posted 2015-01-28 12:07:38. Republished by Blog Post Promoter

First posted December 8, 2009. 
Poor Starbucks.  So much trademark trouble they have!  Other trouble, too.  And now the people who gave you five-dollar coffee in a paper cup had lost another one — one they thought they had won, namely the Starbucks v. Charbucks case (decision here, posted by Marty; the real name of the case is Starbucks Corp. v. Wolfe’s Borough Coffee, Inc.) involving trademark infringement and its genetic freak of a cousin: trademark dilution.

In fact, Starbucks lost this case a lot.  They lost and lost and lost.

Then, they won.  Starbucks won!



At least, they won a shot at winning.  Which, given their litigation luck these days, must be like a double espresso administered intravenously, juridically speaking.  And, brand-wise.

That Law.com piece by Mark Hamblett in the last link is a good summary of the docket-slaloming.  For the law lesson, let’s just skip to smart person Rebecca Tushnet, who may or may not be fueled by caffeine when she blogs but all the same has done all the heavy lifting here:

As we all know, Starbucks is big and famous. Wolfe’s does business as Black Bear, a small business that sells coffee via mail order, the internet, and a limited number of New England supermarkets. In 1997, Black Bear began selling a dark roasted blend, Charbucks Blend, and later Mister Charbucks.

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Blurring away

It really does appear that trademark dilution, once the darling of federal judges seeking to enforce trademark rights in gross on behalf of markholders whose brands they recognized, is getting less and less respect. Which in general doesn’t trouble us too much, though it’s not as if Starbucks hasn’t had enough undeserved aggravation on the trademark front lately, in addition to what it stupidly brings on itself. Reports Mike Atkins, linking to Ryan Gile:

The court framed the issue as follows: “…Plaintiff must demonstrate that Defendant’s use of its ‘Mr. Charbucks’ and ‘Mister Charbucks’ marks for one of its coffee blend products creates associations arising from similarity to the Starbucks marks that are likely to impair the distinctiveness of the Starbucks mark or tarnish that mark by harming its reputation.

On Starbucks’ blurring claim, the court found: “…Starbucks’ marks are distinctive and famous. Thus, several of the specified factors weigh in its favor. However, Defendant’s marks, as used in commerce, are not substantially similar to Plaintiffs’ Starbucks marks, and the association Defendant intended to evoke in consumers’ minds through its playful dissimilar mark is not one that would be likely to dilute the Starbucks marks as unique identifiers of Starbucks’ goods and services. Rather, it is dependent on an identification of those marks with Starbucks’ own products and a characteristic of the taste of those products. The record is, therefore, insufficient to demonstrate the requisite likelihood that the association arising from the similarity of the core terms is likely to impair the distinctiveness of Starbucks’ mark, and Plaintiff is not entitled to injunctive relief under that statute.”

Does that sound right to you? Let’s say I used to think solely of Starbucks when I encountered STARBUCKS coffee, but now after encountering CHARBUCKS coffee, I think of both Starbucks and Wolfe’s Borough Coffee. Isn’t that classic dilution by blurring?

(Decision here.)

This does not sound right to me; not only as an analysis of blurring vel non, but as… an analysis. It really just does not make any sense. Again:

Defendant’s marks, as used in commerce, are not substantially similar to Plaintiffs’ Starbucks marks …

CHARBUCKS for coffee not substantially similar to STARBUCKS for coffee? Really?

… and the association Defendant intended to evoke in consumers’ minds through its playful dissimilar mark is not one that would be likely to dilute the Starbucks marks as unique identifiers of Starbucks’ goods and services. Rather, it is dependent on an identification of those marks with Starbucks’ own products and a characteristic of the taste of those products.”

This appears to be a complete non-sequitur. It is an association with a famous mark intended to be evoked in consumers’ minds? But it is not likely to be dilutive?

And what is a “playful dissimilar mark”? “Playful” because the defendant’s logo has a “cute” bear in it? Another analytical flaw! In fact, those things’ll tear your guts out over a Ring Ding wrapper!

We never much liked trademark dilution, and we’re not alone, but that doesn’t mean it should die by a million small judicial cuts.  Something about Starbucks, though, seems to bring out the haters. Come on, it’s pretty good coffee, people!

Absolutely flawed

Michael Atkins, the estimable Seattle Trademark Lawyer (true, there are others!), writes on the subject both Matthew and I have written about at length here:  The outcome of the CHARBUCKS trademark case.  He says this:

Because trademark dilution doesn’t require an owner to show likelihood of confusion — and, therefore, provides super-trademark rights — the federal statute limits such protection to the owners of truly “famous” trademarks, which the statute defines as trademarks that are widely known on a nationwide basis. In other words, the dilution cause of action is only available to the owners of household names.

STARBUCKS is clearly one such name. Therefore, Starbucks Corp. was able to avail itself of the dilution cause of action against coffee roaster Wolfe’s Borough Coffee, Inc., d/b/a Black Bear Micro Roastery, which had named some of its coffee CHARBUCKS BLEND and MISTER CHARBUCKS. Starbucks argued the roaster’s doing so was intended to and did call to mind Starbucks’ famous STARBUCKS brand, so Starbucks was entitled to an injunction stopping such use. . . .

[I]n the end, the Second Circuit found that despite having super-trademark rights, Starbucks did not prove the roaster’s marks were likely to dilute the famous STARBUCKS brand.

Michael AtkinsIn making that decision, the Second Circuit weighed the factors set forth in the statute. It found the district court was not wrong when it concluded the parties’ marks were not very similar. It also found the district court was not wrong to conclude that Starbucks’ consumer survey was flawed because it did not reflect how the parties’ marks were used in the marketplace. Therefore, it found the survey “only minimally” proved that consumers actually associated the roasters’ marks with STARBUCKS.

The court found three of the statutory factors — distinctiveness, recognition, and exclusivity — favored Starbucks, but “the more important factors in the context of this case are the similarity of the marks and actual association.”

This led the Second Circuit to conclude: “Ultimately what tips the balance in this case is that Starbucks bore the burden of showing that it was entitled to injunctive relief on this record. Because Starbucks’ principal evidence of association, the Mitofsky survey, was fundamentally flawed, and because there was minimal similarity between the marks at issue, we agree with the District Court that Starbucks failed to show that Black Bear’s use of its Charbucks Marks in commerce is likely to dilute theStarbucks Marks.”

This goes to show that while potentially powerful — really powerful — the federal dilution statute does have its limits.

Right.  The only problem is that, let’s face it, no one has any idea what they are.

Because if you would have asked me what would be a good test case for the dilution cause of action based on blurring, I would have bet on this one.  And I say this as not-the-biggest-fan of dilution.  But it is the law.

But what is the law?

STARBUCKS and CHARBUCKS.  For coffee.  Not one of them, but both of them.  Second Circuit:  “Minimal similarity between the marks at issue.”


Maybe this is why some trademark lawyers get paid so well:  We seem to have no idea what we’re talking about.  The outcomes of so many of our cases are, it seems, completely unpredictable — big brand or small.  As for the business owners and the managers and the shareholders who want, who you’d think are entitled to, some degree of predictability in the law, so they could govern their decision-making on both enforcement and business issues?

Not happening.  Because this legal remedy “has its limits.”  Well, our client asks — what are these limits? Read More…

Grande, Venti, De Novo. (Starbucks VI)

mdbheadshotfinalLast week, while one giant was vindicated after years of litigation—even if its name was spelled “Goggle” on page 2 of Judge Chin’s decision—another was dealt a decisive, possibly final blow in federal court. In what I believe will be called “Starbucks VI,” which constitutes the third appellate decision in Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., the United States Court of Appeals for the Second Circuit affirmed the decision of the United States District Court for the Southern District of New York (“Starbucks V”) concluding that Starbucks failed to prove that the defendant’s use of the marks MISTER CHARBUCKS and CHARBUCKS BLEND is likely to dilute Starbucks’s famous marks including, of course, STARBUCKS.

Here are the salient points from what will be—unless Starbucks appeals to the Supreme Court—the last word in the matter [For some previous words, start here — RDC]


Just one of at least 56 marks…

Way back in 2005, a bench trial was held in the Southern District to determine whether Wolfe’s Borough Coffee, a New Hampshire corporation doing business as “Black Bear Micro Roastery,” was infringing on some of the more than 56 registered trademarks of Starbucks Corp.—including the mark STARBUCKS and those that incorporate that mark—by using marks that include the word “Charbucks.” Even before Black Bear began using its CHARBUCKS marks, the Starbucks marks had become famous. And if we’re talking about famous marks, then of course we’re going to talk about dilution.

Indeed, dilution is all the Second Circuit addressed in its most recent decision, because Starbucks’s claims of trademark infringement in violation of 15 U.S.C. § 1114(1), unfair competition in violation of 15 U.S.C. § 1125(a), trademark dilution in violation of NY Gen. Bus. Law § 360-l, deceptive acts and business practices and false advertising in violation of NY GBL §§ 349 & 350, and unfair competition in violation of New York common law were all dismissed previously. In other words, Starbucks kept losing grounds. Er, ground.

At the trial, “two matters of significance to [the last] appeal occurred,” according to the Second Circuit. One of those is that Starbucks introduced the testimony of a “scientist in the field of consumer research and polling.” Warren J. Mitofsky explained the results of a telephone survey he had conducted of “six hundred participants, designed to be representative of the United States population.”

 The survey asked, “What is the first thing that comes to your mind when you hear the name ‘Charbucks,’ spelled C-H-A-R-B-U-C-K-S?” 30.5 percent of participants answered “Starbucks.” Nine percent answered “coffee.” (Other common responses included “barbecue” or “charcoal”; “restaurant” or “grill”; “meat,” “steak,” or “hamburger”; and “money.”)  When the participants were asked “Can you name a company or store that might offer a product called ‘Charbucks’?,” 3.1 percent responded “Starbucks,” and another 1.3 percent responded “coffee house.” But more popular responses to the second question included: “grocery store”; “discount store”; “restaurant”; “department store”; and “hardware store” or “home improvement store.”

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