Friday, June 29, 2007

Hansen Beverage Co. v. National Beverage Co. (9th Cir. - June 29, 2007)

Judge Canby had me going here. At least for a while.

It's a trademark case. Hansen makes the "Monster" energy drink. National introduced a new energy drink which it called "Freek," with a prominent picture of a monster on the can. The issue is whether Freek violates Monster's trade dress. The district court granted a preliminary injunction, finding substantial likelihood of confusion.

Judge Canby's opinion is nice and tight. It starts out by addressing -- quickly, and, I thought, fairly accurately -- a couple of procedural issues; e.g., issue preclusion. So far so good. Then it concludes that, on the merits, the district court erred. It says that "Monster" and "Freek" are not really the same, which makes sense. It says that the aggressive coloring of Freek should not really matter, which I think is right. It points out some other relevant differences between the cans. All of this seemed fairly persuasive, albeit a bit perfunctory.

But then, on the last couple of pages, the opinion goes from being fairly tight to being conclusory and unsupported. The district court discusses lots of factors that allegedly indicate likelihood of confusion to which Judge Canby simply responds that these factors "could apply to any number of competitors in the energy drink market." Maybe. But that doesn't make them irrelevant or untrue; e.g., the fact that Monster's marks are arbitrary (and hence entitled to a greater degree of protection), the fact that the goods are inexpensive and hence that customers are likely not to devote a great deal of care to their selection, and (significantly) the fact that there is evidence of actual confusion. At this point, it seemed like Judge Canby was relentlessly moving towards a particular conclusion without bothering to support it.

Mind you, as I was reading, I still assumed that Judge Canby was right; just that his opinion on these points was not particularly persuasive. It still seemed, from his description, that overall, the products were sufficiently different such that consumers weren't likely to be confused. So that Judge Canby was correct that the district court erred.

Then I looked at the separately-attached exhibits, which displayed pictures of the two cans. And totally changed my mind.

These cans look very similar. It's not the picture of the monster that matters -- that's the thing that Judge Canby focused on. It's the prominent dripping lettering of the word "Freek" on the can that looks, to me, totally similar to the prominent "M" on the Monster can.

I can easily see from the pictures why consumers might be confused. As well as why National (as the district court found) aggressively tried to ensure placement of the Freek cans side-by-side with Monster cans. Because, especially side-by-side, you could easily get the sense that they were from the same company. (The only defense, ironically, is that the Freek cans, to me, look a lot cheesier than the Monster cans. But incredible lameness is probably not a compelling defense to trademark infringment.)

So while Judge Canby's analysis and opinion originally (weakly) persuaded me, as they say, a picture is often worth a thousand words. I agree with the district court.

Look at the pictures and see what you think.

Even if reasonable minds (and eyes) could disagree on this one, I surely don't think that the district court's decision was clearly erroneous, as would be required in order to reverse the issuance of the preliminary injunction. I'd have gone the other way in this one.