# Petition — General Footwear Co. v. American Footwear Corp. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385006_1665%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition - **Published:** January 1, 1980 - **Citation:** 445 U.S. 951 ## Text Eupreme Court, U, a FILED | 79-1224 | IN THE i Supreme Court of the United. OCTOBER TERM, 1979 ° GENERAL FOOTWEAR COMPANY LIMITED, and UNIVERSAL CITY STUDIOS, INC., Petitioners, against AMERICAN FOOTWEAR CORPORATION, : Respondent. TA ERLE, SEER AIL GRIN, TAME TERI EE IE RIEL LES ORE TEED ELE NE AEE I PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT ee TL, A ET A RSE REY Evan L. Gorpon Attorney for Petitioners 55 Broad Street New York, New York 10004 Of Counsel: Worsey, CertiumMan, Hart & LeBow Barry J. BENDES TABLE OF CONTENTS Oe a es ee 1 Re | Stataiee davedved 80! '92 to etm beh 6 ace 2 2 2 I 3 EEE RE a eS 3 7 9 Reasons for Granting the Writ .......... Dah elu The question of whether Universal is entitled to enjoin American from capitalizing upon the popularity and commercial value of Universal’s creativity in creating the two television series in issue for American’s own profit by adopting the principal term by which the series and its char- acters are known and by selling its product in a manner calculated to evoke an association with the two television series presents: an im- portant question of the scope of the federal trademark and statutory unfair competition laws and the common law of unfair competi- tion which has not been, but should be settled ogg iy BR Ee os pe The Importance of the Issue Presented .... 9 The significance of the Unsettled Legal Prin- ciple to the Merchandising Licensing Indus- WT PMRW SURGE WUL Gr Nobis kckav.c si ccccuecne 11 ii PaBLE OF CONTRI" PAGE The Court of Appeals failure to revognize the applicability of the Doctrine of Unfair Competition to American’s purloining of the __ television word and oe Property PE 5 Cas spelled es «ed Bpld.chiniaga sks 13 The Second Circuit’s decision conflicts with the law of the Fifth Circnit on the ‘‘Likelihood of Confusion’’ testi and improperly denies peti- tioners a federal cause of action under the Lan- WINS ios v8 Sook hemes pA RG 5 bes pA S04 AG wee Ole 15 CIE, 6h beds RD RAS As os GiRnes ws. Pa Chae ee 20 APPENDIX: Opinion of the Court of Appeals .................. Al Judgment of the Court of Appeals ................. A21 Opinion of the U.S.D.C., S.D.N.Y. (Carter, DJ.) .... A23 Deposition of Gary Evans ..............0.ccceeees A36 Exhibits Presented in Evidence at Trial of Action .. A411 TABLE OF AUTHORITIES ili PAGE Boston Professional Hockey Association v. Dallas Cap é Emblem Mfg., Inc., 510 F.2d 1004 (5th ‘Cir. 1975), cert. denied, 423 U.S. 868 (1975), rehearing denied, 423 U.S. 991 (1976) ............000, 13, 16, 17 D.C. Comics, Inc.. v.. Powers, 465 F.Supp. 843 (S.D.N.Y. 1978). « .... 23. yh wid ch Lie staid wah 17 DeCosta v. Columbia Broadcasting System, 520 F. 2d 499 (1st Cir. 1975), cert. denied, 423 U.S. 1073 COU. Chead reesav easy asad c hao ek Coles ck. 13 Federal-Mogul-Bower Bearings, Inc. v. Azoff , 313 F.2d eS SE beck oa ccanes% cumsocs moscis oath 16 Fleischmamn Distilling Corp. v. Maier Brewing Co., 314 F.2d 149 (9th Cir. 1963) .................. 17 Fleaxitized, Inc. v. National Flexitized Corp., 335 F.2d SE Cee SNR A hh nh d Keo he kh h wasebene 13 Goldstein v. California, 412 U.S. 546 (1973) ........ 13 HMH Publishing Co., Inc. v. Brincat, 504 F.2d 713 (9th Cir. 1974) eT eT ee ee ee ee 14 Ideal Toy Corp. v. Kenner Products, 443 F.Supp. 291 RS MERE Sot eG tan oats ta meee CaN e es oles 13 International News Service v. Associated page 248 USS. 215 (1918)........ WeeeT Tete te ty eee 13 L’Aiglon Apparel, Inc. v. Lana Lobell, Inc., 214 F.2d RO Se PONE Sa ewes s eecnwadea wees cas 16 Lone Ranger, Inc. v. Cox, 124 F.2d 650 (4th Cir. ee St OLN be kal bass a Se ke Ka 14 Mortellito v. Nima of Caltforma, Inc., 335 F.Supp. SE La es BOP ood Ks aad ln es Sone CEU 16 National Football League v. Governor of the State of Delaware, 435 F.Supp. 1372 (D.Del. 1977) ...... 13 iv TABLE OF AUTHORITIES PAGE National Lampoon, Inc. v. American Broadcasting Co., Ine., 376 F.Supp. 733 (S.D.N.Y. 1974), aff'd 497 F.2d 1343 (2d Cir, 1974) ..... 2... ee cece ee ees V4 Triangle Publications, Inc. v. Rohrlich, 167 F.2d 969 ee ee ok, eee Moir 14 Union Carbide Corp. v. Ever-Ready, Inc., 531 F.2d 366 (Fie ies TOSS) Sc SI ak 19 Wyatt Earp Enterprises v. Sackman, Inc., 157 F, Bote. GR CHEAT. Rs SOUS) oi cc ici ccccccccc 14 Zacchint v. Scripps-Howard Broadcasting Co,, 433 US. 562 (1977) ......... data acter Mah see ak 13, 14 . .Statures, Rutes anp Reeurations Crrep Statutes: 15 U.S.C. Dy MONS ictdcke es 8G cevaiiw hacen 7 DEM ick ckaGiinacsl so waruekke? 2, 3, 15, 16, 17 Se UTR Re A Sininake evan sdcanabweoud knee 2 SEES nea RA rane ite Tae Seb: 8 MME Coos hooks be akas SaeKe ak 8 DIE 6.00060) Pi dkos echoes ea Co 8 Pees adel avenbi cn uch tad wad 2 OrneR AUTHORITIES Grimes and Battersby, “The Protection of Merchan- dising Properties,” 69 Trademark Reporter 431 CEPUR) = ai ee edu deus eA Acdece 9, 10 IN THE Supreme Court of the United States OCTOBER TERM, 1979 Bes bccenieail a GENERAL Footwear Company LimiteD, and Unrversat City Srupios, Inc., Petitioners, against AMERICAN Footwear CorPoraTION, Respondent. + - PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT Petitioners pray that a Writ of Certiorari issue to review so much of a judgment of the United States Court of Appeals for the Second Circuit as affirms a judgment of the United States District Court for the Southern District of New York denying a permanent injunction to petitioners. Opinion Below The opinion of the United States District Court for the Southern District of New York (A, pp. 23-35), is reported at 199 U.S.P.Q. 531 (S.D.N.Y. 1978). The opinion of the United States Court of Appeals for the Second Circuit (A, pp. 1-20), is yet unreported. 2 Jurisdiction The judgment of the United States Court of Appeals for the Second Circuit sought to be reviewed (A, pp. 21-22), was entered on November 9, 1979. The instant petition is filed within ninety days‘of the judgment and is thus timely, pursuant to 28 U.S.C. § 2101(c). Jurisdiction of this Court is invoked under 28 U.S.C. § 1254(1). Question Presented for Review Whether the public interest in fair business practices and the promotion of useful arts is frustrated by denying protection to the creator of a famous television series which took a previously obscure technical and scientific term, used the term as the primary and secondary titles _and nicknames of its television series and characters and gave the term a fanciful meaning connected with the tele- vision series and cultivated public acceptance and popu- larity of the term so as to create great commercial value in the term as a merchandising property against interfer- ence by a party which intentionally capitalized on the term for its product as a result of the popularity of the tele- vision series and exploited that popularity and commercial value to the detriment of the creator. Statute Involved Title 15 U.S.C. § 1125 provides in pertinent part: “(a) Any person who shall affix, apply, or annex, or use in connection with any goods or services, or any container or containers for goods, a false desig- nation of origin, or any false description or repre- sentation, including words or other symbols tending falsely to describe or represent the same, and shall cause such goods or services to enter into commerce, and any person who shall with knowledge of the falsity of such designation of origin or description or representation cause or procure the same to be transported or used in commerce or deliver the same to any carrier to be transported or used, shall be liable to a civil action by any person doing business in. the locality falsely indicated as that of origin or in the region in which said locality is situated, or by any person who believes that he is or is likely to be damaged by the use of any such false description or representation.” Statement of the Case Facts in Issue: In January 1974, Petitioner Universal ‘City Studios, Inc. (“Universal”), first introduced a program entitled “The Six Million Dollar Man’’ as a half-season series for ABC television. The series continued for the next three full seasons at 8:00 P.M. on Sunday night on the ABC television network. In the first motion picture created by Universal, the hero, Steve Austin, played by Lee Majors, suffers a catastrophic accident, following which he is rebuilt by an aerospace team at a cost of $6,000,000. The rebuilding of Steve Austin involved the replacement of an eye, an arm, and two legs, with artificial organs with capabilities twenty times more efficient than those of the normal human being. These artificial super-human parts are denominated throughout the ensuing series as Steve Austin’s “Bionic” parts. Each of the subsequent episodes of the television series depicts specific action events by Steve Austin and the in- credible feats he is able to perform as a result of his specially reconstructed eye, arm and legs. Steve Austin was immediately nicknamed the “Bionic Man” and was so designated at the opening portion of each weekly episode where his superhuman strength, speed and jumping ability + are visually emphasized through a slow-motion sequence. The ‘‘Bionic Man’’ is the subtitle of the television series ‘The Six Million Dollar Man’’. In the five years that “The Six Million Dollar Man” ran as a weekly television series, it consistently attained high Nielsen ratings indicating that between seventeen million and nineteen million household audiences per week viewed the’ show. In January 1976, Universal commenced a second weekly television series entitled “The Bionic Woman”. The series portrayed the exploits of “The Bionic Woman”, a character which had been introduced in a March 1975 episode of ‘The Six Million Dollar Man’’, and the character had been featured in three other episodes of “The Six Million Dollar Man’’ prior to the introduction of the new series. “The Bionic Woman”’, as well as ‘‘The Six Million Dollar Man’’ is rebuilt following an accident in a manner similar to Steve Austin, with two artificial legs, an artificial arm, and a supersensitive ear. Each episode of ‘‘The Bionic Woman” as well as of “The Six Million Dollar Man” began with a series of short scenes in which the main character performed various feats where his or her super- human strength, speed and jumping ability are visually emphasized through slow motion and special effects created by and unique to Universal and these television shows. In February 1976, “The Bionic Woman” achieved a Nielsen rating in excess of nineteen million household audiences for each of its weekly episodes. Thus, the Uni- versal creations of ‘‘The Six Million Dollar Man’’ and ‘‘The Bionic Woman’’ were among the most popular tele- vision series of their time in that approximately forty million viewers saw one or another or both of the episodes of ‘‘The Six Million Dollar Man”’ or ‘‘The Bionic Woman’’ during the airing of the shows on a twice weekly basis. 5 Universal and its affiliated company, Merchandising Cor- poration of America, Inc., which licenses Universal’s prop- erties to various manufacturers, embarked from the outset of the first television series on an aggressive merchandising campaign of various items designed for young people re- lated to “The Six Million Dollar Man” and “The Bionic Woman” television series. These items include all types of toys, games, clothing (including socks), costumes, slides and film strips, candy items, phonograph records, and numerous other items. As of the date of trial, Universal’s aggressive merchandising campaign of “Bionic” items had resulted in the receipt of in excess of $10,000,000 in royalties from numerous licensees. Moreover, the licensees expended millions of dollars in advertising their respective products and there was substantial television advertising of both the series and the products generated therefrom. Because the T'V shows aired twice a week and in addition were advertised several times each week by the network, and because numerous licensed products were in the retail stores and millions of dollars of advertising were expended regarding these products, the consuming public was con- tinually bombarded with “Bionic” in relationship to the TV shows and those licensed products, so that any product bearing the TV word “Bionic” was a presold commodity to the consuming public, In approximately March 1976, Genera] Footwear Com- pany Limited (“General”) obtained a license from Mer- chandising to manufacture and sell children’s sneakers at retail for approximately $4.00 per pair based on the themes and characters of the two television shows. The children’s sneakers in question contained the legend of either “The Six Million Dollar Man” or “The Bionic Woman” on the side of the sole, contained a small chevron or patch with the name of the appropriate television show on the side of the shoe, had the word “Bionic” embedded in the bottom of the sole, and contained the legend on the 6 tongue of each sneaker “Bionic By Chex”. General’s sales of “Bionic” sneakers exceeded $1,000,000 and 250,000 pairs in the first fifteen months of the contract period end- ing October 2, 1977. — Sometime in 1975, Anwelt Corporation, a manufacturer and seller of workshoes, including boots, safety shoes, hiking boots and hand-sewn footwear under private labels, designed a new adult hiking boot. Anwelt designed the boot at the request of J.C. Penney to be sold under J.C. Penney’s private label, and not as a “Bionic” product. Anwelt invested approximately $50,000 in the purchase of this new adult luxury hiking boot from the manufacturer. This expenditure was without any relation to the “Bionic” name. Respondent American Footwear Corporation (“Ameri- can”) a company related to Anwelt, is engaged in the busi- ness of manufacturing and selling at retail under its own label the same types of shoes as are sold by Anwelt under private label. In the third week of January 1976, after American had determined to sell the Anwelt-J.C. Penney new adult luxury hiking boot under its own label, a meet- ing was held to select a name for American’s use of the boot. The decision to call the boot “The Bionic Boot” was made by Gary Evans, a Vice President of American. It is conceded by Mr. Evans (A, pp. 36-39), that the name was selected because of the popularity of Universal’s two television programs, and that had it not been for the pro- grams, the name would not have been selected by Ameri- can. Once the name was selected, American personnel prepared an advertising poster to be displayed at the Na- tional Shoe Show in January 1976 in New York. The poster, designed to advertise American’s new “Bionic Boot’’, shows a woman in a slow-motion running position in & pose conveying a sense of motion (like the “Bionic Woman” character at the beginning of each television show) (A, pp. 41-42) even though American’s hiking boot was not designed for running. The pose was created by 7 Universal to convey a sense of superhuman speed and was unique to the television series “Bionic” characters. American invested approximately $3,000 over a period of almost two years in advertising its newly-named boot. From January through July 1976, American sold to re- tailers a total of 1,667 pairs of Bionic Boots and an addi- tional 2,255 pairs were sold from August 1, 1976: through July 31, 1977. It is unknown how many of the boots were sold to the consuming public. During the same period of time, however, Anwelt sold approximately 5,000 pairs of the same boot under the J.C. Penney private label. Proceedings Below: American commenced the instant dispute by filing an action in the New York Supreme Court on July 30, 1976, against General, seeking, among other things, to enjoin General from manufacturing and selling its Bionic chil- dren’s sneakers. American claimed that its previous ap- plication of the mark “Bionic” for adult hiking boots in the trademark office deprived General of any right to use the term “Bionic” in connection with the manufacture and sale of its children’s sneakers. On August 13, 1976, General removed that action to the United States District Court for the Southern District of New York and on September 20, 1976, commenced a sep- arate action against American in the same court, alleging that American, by i.3s use of the term “Bionic”, and the marketing of its “Bionic Boot’’, had infringed upon Gen- eral’s rights as exclusive licensee of Universal for foot- wear designed to capitalize on the popularity of the two Universal television series. Universal was subsequently granted leave to intervene in both actions and the two actions were thereafter consolidated for ail purposes. Jurisdiction of the District Court was invoked under the trademark laws and the Trademark Act of July 5, 1946, 15 U.S.C. § 1051, et seqg., under diversity of citizen- 8 ship pursuant to 28 U.S.C. § 1332, pursuant to 28 U.S.C. § 1331, and because of pendent jurisdiction pursuant to 28 U.S.C. $1338. The consolidated action contained the claims by Ameri- can as plaintiff in its suit against General and Universal for common law trademark infringement, unfair competi- tion, and tortious interference with business relations and also contained the claims of Universal and General against American for common law and statutory trademark in- fringement, unfair competition, false designation of origin, passing off, and dilution. Following a non-jury trial, the United States District Court for the Southern District of New York found that because American had filed a trademark application for the use of the term “Bionic” in connection with footwear before General, that American was entitled to an injunc- tion against Universal and General for trademark in- fringement and unfair competition. The District Court further found that Universal and General were not en- titled to sizailar relief against American. On November 9, 1979, the United States Court of Ap- peals for the Second Circuit, finding that American had established none of the criteria to sustain an injunction against Universal and General, reversed so much of the judgment of the District Court as granted that injunction. The Court of Appeals, however, affirmed that part of the judgment that denied an injunction to Universal and Gen- eral despite the Court’s following findings: that Universal, through the showing of its immensely popular television series entitled ‘‘The Six Million Dollar Man’’ and the ‘‘Bionic Woman’”’, had popularized and cultivated public acceptance of the relatively unknown word ‘‘Bionic’’; that the term ‘‘Bionie’”’ as popularized by Universal, had a sep- arate television meaning unrelated to the dictionary defini- tion of ‘‘bionics”’; that Universal’s efforts in popularizing the term ‘‘Bionic”’ was sufficient to support a finding of dis- 9 tinctiveness; and that American, by naming its footwear the ‘‘Bionic Boot,’’ had intended to capitalize on Uni- versal’s popularization of the word ‘‘Bionic.’? The Court further found that Universal’s merchandising program was expanding into new fields (A, pp. 18-19). As a result of the Court of Appeals’ decision, all pMrties were permitted to use the term ‘‘Bionic’’ with reference to the merchandising of the footwear that the parties presently merchandise. REASONS FOR GRANTING THE WRIT The question of whether Universal is entitled to enjoin American from capitalizing upon the popu- larity and commercial value of Universal’s creativity in creating the two television series in issue for Ameri- can’s own profit by adopting the principal term by which the series and its characters are known and by selling its product in a manner calculated to evoke an association with the two television series presents an important question of the scope of the federal trademark and statutory unfair competition laws and the common law of unfair competition which has not been, but should be, settled by this Importance of the Issue Presented. One commentator has recently taken note of the growing phenomenon of the licensing of merchandis- ing properties on an extensive scale, Grimes and Bat- tersby, ‘‘The Protection of Merchandising Properties’, 69 Trademark Reporter 431 (1979) (hereinafter cited as ‘‘Grimes’’). Grimes notes that merchandising properties include ‘‘any word, name, title, symbol, character or per- sonality image, design or combination thereof which, when used on or in association with a particular product [or service], will create consumer demand therefor.’’ Grimes, swpra, at 431. 10 Many of the currently popular merchandising properties emanate from the entertainment industry. Movie titles (Jaws) and the names of television stars (Farran Fawcett) and cartoon characters (Mickey Mouse and Snoopy) are frequently used merchandising properties, as are the names of sports figures (Reccm Jackson). The wide range of goods and services sold under these merchandising proper- ties vary from toys (Farran Fawcetr dolls) to candy (Reeare bars). Well-known names and trademarks outside the entertainment area are also widely used merchandising marks. The name Oxec Cassini appears on a great variety of goods, including clothing, toiletries, and carpeting, while the famous Bupwetser trademarks have been placed on everything from T-shirts to waste cans. The growth of licensing of merchandising properties on an extensive scale is evidenced, for example, by the licens- ing of cartoon characters alone, which in 1978 reportedly generated $65.3 million, and by the licensing campaign from the motion picture Star Wars, which is estimated to have produced $400 million in retail sales as of October 1978. Grimes, supra, at 436. In the present case, the Court of Appeals noted that petitioner Universal received royalties in excess of $10 million from its merchandising program connected with the name “Bionic” and the television shows “The Six Million Dollar Man’’ and “The Bionic Woman” (A, p. 15). Thus, retail sales would have been considerable. An enormous industry has developed around the li- censing of merchandising properties, including companies whose revenues are entirely dependent upon royalties from merchandising properties. One such company, Merchan- dising Corporation, is Universal’s exclusive licensing agent. The licensing of television words and characters is ex- tremely valuable because a manufacturer is buying for his product the use of a word and/or personality which has acquired the attributes of a very strong trademark, i.e. instant recognition and consumer demand. 11 The. Significance of the Unsettled Legal Principle to the Merchandising Licensing Industry. In the instant case, it is conceded by American that the use of the term “Bionic” was prompted by the television series. Indeed, American’s Vice President, Gary Evans, conceded that had it not been for Universal’s television program, the word “Bionic” would probably never have been selected by American (A, pp. 36-39). The Court of Appeals specifically found that American adopted the term “Bionic” to capitalize on the television series (A, p. 4) and further accepted Universal’s argument that it had popular- ized the term “Bionic” by agreeing with the District Court that “Bionic” as used by Universal and as adopted by American, was “a television word” (A, p. 30). Indeed, the evidence is overwhelming and uncontested that American’s adop..on of the term “Bionic” and the definition by Mr. Evans of that term as “strong, rugged [and] outdoor” (A, p. 38), specifically reiates to the television series and the television word “Bionic”. The Court of Appeals nonetheless ruled that Universal had failed to establish its right to an injunction based upon American’s clear misappropriation of the television word “Bionic”. The Court of Appeals stated that “one can not sell his product by misappropriating the good will of an- other through misleading the public into thinking that it is sponsored by or derived from something else” (A, p. 12). The Court of Appeals thus ruled that unless a showing can be made of confusion of customers between American’s product and a sponsorship of that product by Universal, that no cause of action existed in favor of Universal (A, p. 14). As a result of the Second Circuit’s opinion, the viability of Merchandising and the vast industry of licensing mer- chandising properties is severely threatened. 12 The creators of television programs or movies, sports figures, or other persons possessing merchantable property in their names, likenesses or symbols are rarely in the busi- ness of manufacturing toys, sporting wear or other p.oducts or services commonly bearing merchandising properties. The Second Circuit opinion is likely to induce the manu- facturers of these types of products to ignore the licensing programs of the creators of these merchandising properties and to cash in directly and immediately upon the popularity of the properties. A shoe manufacturer, for example, will easily be able to establish priority of use of a particular merchandising property in connection with shoes over the movie studio that created popularity in the property. The same is true with other merchandise manufacturers. Following the debut or establishment of each successful movie, television show or famous trademark, there will be a flood of trademark uses and applications for trademark registrations in the U.S. Patent and Trademark Office for the same name or symbol for various goods and services by different predators. The federal trademark law and federal trademark registrations will thereby be unfairly used by these predators to carve their own slices from the merchandising pie created by the movie, television show or famous trademark. As a further consequence of the Second Cireuit opinion, such predators will be unjustly enriched due to the efforts and at the expense of the creator of the merchandising property. Thus, contrary to the Second Circuit’s assumption that the district court’s judgment (and, therefore, its own ruling) ‘‘in no way interferes with Universal’s trademark rights in its T.V. shows or its licensing operations in re- spect thereto’’ (A, p. 35), the lower courts’ rulings present @ grave danger to Universal’s licensing operations and the merchandise licensing industry. 13 The Court of Appeal’s Failure to Recognize the Applicability of the Doctrine of Unfair Competition to American’s Purloining of the Television Word and Merchandising Property “Bionic”. This Court long ago established that a cause of action in’ unfair competition exists when a defendant misappropri- ates a plaintiff’s product into which the plaintiff has put time, skill and money, and the defendant uses the plain- tiff’s product in competition with the plaintiff, gaining an advantage in that competition because the plaintiff, and not the defendant, has expended the energy to produce it, International News Service v. Associated Press, 248 U.S. 215 (1918). Recently, this Court has reaffirmed the right to protection of the product of one’s own talents and energy from improper economic exploitation of another, Zacchim v. Scripps-Howard Broadcasting Co., 433 U.S. 562 at 575-576 (1977); Goldstein v. California, 412 U.S. 546, 570-571 (1973), and lower courts in various jurisdic- tions have followed this Court’s pronouncements, DeCosta v. Columbia Broadcasting System, Inc., 520 F.2d 499, 570 (1st Cir. 1975), cert. denied, 423 U.S. 1073 (1976); Boston Professional Hockey Association, Inc. v. Dallas Cap 4 Emblem Mfg., Inc., 510 F.2d 1004 (5th Cir. 1975), cert. denied, 423 U.S. 868 (1975), rehearing denied, 423 U.S. 991 (1976); Ideal Toy Corp. v. Kenner Products, 443 F. Supp. 291 (S.D.N.Y. 1977); National Football League v. Governor of the State of Delaware, 435 F.Supp. 1372 (D.Del. 1977). Moreover, the United States Court of Ap- peals for the Second Circuit, from which this case em- anates, has also established the salutary rule that unfair competition encompasses a broad range of unfair trade practices generally described as the misappropriation of the skills, expenditures and labors of another. Flezitized, Inc. v. National Flexitized Corp., 385 F.2d 774, 781 (2d Cir. 1964). The misappropriation can, for example, involve the theft of goodwill inherent in a person’s right of pub- 14 licity in the exploitation of his personality and talents, Zacchini v. Suripps-Howard Broadcasting Co., supra, at 577. The Court of Appeals, by ruling that American’s ad- mitted purloining of the television word “Bionic” was per- missible so long as it did not confuse customers as to the source of sponsorship of the product, placed an unnecessary limitation on the foregoing established principles in the law of unfair competition. It is the misappropriation of the skills, labors and expenditures of another and not the effect which the misappropriation may have in the marketplace once it is accomplished that gives rise to Universal’s cause of action. The Court below recognized that rights can accrue from the misappropriation of symbols such as that involved in the instant case, see, e.g., Triangle Publications, Inc. v. Rohrlich, 167 F.2d 969 (2d Cir. 1948); Lone Ranger, Inc. v. Cox, 124 F.2d 650 (4th Cir. 1942); National Lampoon, Inc. v. American Broadcasting Co., Inc., 376 F.Supp. 733 (S.D.N.Y. 1974), aff'd 497 F.2d 1343 (2d Cir. 1974) ; Wyatt Earp Enterprises v. Sackman, Inc., 157 F.Supp. 621 (S.D.N.Y. 1958). The Court ruled, however, that the mere misappropriation of a symbol popularized and given com- mercial value by another was not actionable and that there is a requirement of substantial secondary meaning in a plaintiff’s arbitrary trademark, Triangle Publications, Inc. v. Rohrlich, supra (secondary meaning in mark “Seven- teen”), or bad faith predatory conduct justifying relief, Lone Ranger, Inc. v. Cox, supra; HMH Publishing Co., Inc. v. Brincat, 504 F.2d 713 (9th Cir. 1974) (bad faith). Ap- parently, the Court of Appeals confused the standard re- quired to establish substantial commercial value in a mark by relying upon the impact of the mark in the marketplace, rather than solely upon the conduct of the infringer in pur- loining the mark in the first place. The fact that American considered the television word ‘Bionic” to have a com- mercial value sufficient to misappropriate it should be all the evidence that is required. 15 Although Universal believes that the mere adoption of the television word “Bionic’ by American is sufficient to give Universal the right to enjoin the use of the term, it is also apparent that American went further in its attempt to capitalize upon the popularity of the television word “Bionic’’ by its advertisement of the Bionie Boot. The advertisement shows a woman in a running pose similar to the running pose adopted by Universal’s theme character at the opening of each program of the “Six Million Dollar Man”, or the “Bionic Woman”. The Court of Appeals dismissed this element of unfair competition by stating that an advertisement for footwear lends itself to a running pose and that the similarity between the poster and the scene for a television show are not so marked that when the poster is displayed together with the scene, an ordinarily prudent public would be likely to be misled into believing that any sponsorship arrangement existed between Universal’s television show and American’s product (A, p. 8). Thus, the Court of Appeals not only ruled that the mere purloining of the television word “Bionic” was not action- able, but also ruled that there must be evidence of actual customer confusion as to the sponsorship of the infringing product in order to constitute an action for unfair competi- tion. Thus, the Court ruled that Universal could not enjoin American merely upon a showing of an attempt to capitalize upon the popularity of the television series and the result- ing damage to Universal’s merchandising licensing pro- gram. The Second Circuit’s Decision Conflicts With the Law of the Fifth Circuit on the “Likelihood of Con- fusion” Test and Improperly Denies Petitioners a Federal Cause of Action Under the Lanham Act. Among the legal theories advanced by Universal in the courts below was a violation of the Lanham Act, in partic- ular Section 43(a), 15 U.S.C. §1125(a). To petitioners’ : 16 knowledge, this section of the Lanham Act and the “likeli- hood of confusion” test under this and other sections of the Act have never been interpreted by this Court. Asa result, the federal courts have not uniformly applied this test. Section 43(a) creates a statutory federal tort apart from common law unfair competition. Federal-Mogul-Bower Bearings Inc. v. Azoff, 313 F.2d 405 (6th Cir. 1963). The section may be invoked by “a broad class of suitors injured or likely to be injured”, L’Aiglon Apparel Inc. v. Lana Lobell Inc., 214 F.2d 649, 651 (3d Cir. 1954), and is not limited to suits between business competitors. Mortellito v. Nina of California, Inc., 335 F.Supp. 1288, 1294 (S.D.N.Y. 1972). Section 43(a) does not require ownership of a federal trademark registration. Boston Professional Hockey Association Inc. v. Dallas Cap & Emblem M fg. Inc., Supra. The Second Circuit construed the test “under both the Lanham Act and the common law” as “the likelihood that the consuming public will be confused as to the source of the allegedly infringing product” (A, p. 16). -However, as noted in Boston Professional Hockey Association, Inc. v. Dallas Cap ¢ Emblem Mfg. Inc., supra, at 1012, “the [Lanham] act was amended to eliminate the source of origin as being the only focal point of confusion.’’ The Boston court and other courts considering merchandising rights under section 43(a) and the law of unfair competi- tion have held that the likelihood of confusion test is satisfied by: ‘‘the fact that the defendant duplicated the protected trademarks and sold them to the public knowing that the public would identify them as being the teams’ trademarks. The certain knowledge of the buyer that the source and origin of the trademark symbols were in plaintiffs satisfies the requirement of the act. The argument that confusion must be as to the source of the manufacture of the emblem itself is unpersuasive, 17 where the trademark, originated by the team, is the triggering mecharism for the sale of the emblem.’’ 510 F.2d at 1012. In other words, likelihood of confusion can be estab- lished by evidence that the defendant used the merchan- dising property with knowledge that the public would associate the mark, if not the goods, with plaintiff. Most recently, in D C Comics, Inc. v. Powers, 465 F. Supp. 843 (S.D.N.Y. 1978), the plaintiff, owner of the Superman story, sought a preliminary injunction under section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and under New York’s anti-dilution statute and common law. Defendant published an underground news publication en- titled the Daily Planet which was also the title of a mythi- cal newspaper in the Superman story. Plaintiff had estab- lished an extensive licensing program around the Superman name and characters, but had never licensed the term ‘‘Daily Planet”? separate from all of the Superman char- acters. The court, in granting a preliminary injunction, stated that the applicable principle of law was: ‘that [where] another’s name was adopted deliber- ately with a view to obtain some advantage from the good will, good name, and good trade which another has built-up, then the inference of [the] likelihood of confusion is readily drawn, for the very act of the adopter has indicated that he expects confusion and resultant profit.’ Fleischmann Distilling Corp. v. Maier Brewing Co., 314 F.2d 149, 158 (9th Cir. 1963), cert. denied, 374 U.S. 830 (1963).’? 465 F.Supp. at 848. In the present case, the lower courts found that defend- ant was aware of the popularity in “Bionic” generated by Universal’s television shows and selected “Bionic” as its trademark because of this popularity and to ‘‘capitalize’’ 18 on it. The survey evidence offered by Universal, which was rejected on the basis that the survey question was “too self-serving’’,* showed that 55% of the 802 indi- viduals surveyed associated a ‘‘bionic product’? with Uni- versal’s television shows or principal characters. In addi- tion to using “Bionic”, American also used an advertising poster showing a woman wearing American’s hiking boots (which are not designed for running), in a running : pose copying the running pose used by Universal’s “Bionic Man”’ and ‘‘Bionic Woman’’ characters at the beginning of their respective programs. Moreover, both sides alleged the existence of likelihood of confusion to support their respective claims, and the Court of Appeals ruled that Universal, not American, was expanding into new fields (A, pp. 18-19). These facts and findings satisfy the likelihood of con- fusion test of the Fifth Circuit and the aforesaid lower court decisions and warrant an injunction against Ameri- can. The Second Circuit, however, has now taken the view that the owner of a merchandising property like “Bionic” must show more than a misappropriation of its property. Uni- versal was also required to show that American capitalized on the market created by Universal “by confusing the public into mistakenly purchasing the product in the belief that the product is the product of the competitor.” This narrow focus on consumer confusion as to source of the goods, as distinguished from endorsement or sponsorship, has not been required in previous case law. This requirement pre- sumes that the sole function of the merchandising property * The Court’s suggestion that the survey question used (‘‘ With whom or what do you associate a product labelled Bionic?’’) should have been replaced with a different question (‘‘With whom or what do you associate a ‘‘bionic boot’’?) further illustrates the Court’s narrow focus on classic trademark rights and ignores the non-classic role of merchandising properties. 19 is to indicate source of origin, and it also suggests that actual confusion must be shown. However, as shown earlier, merchandising properties serve functions other than indicating source, and “the source of origin’ language was eliminated from the Lanham Act as the focal point of confusion. Furthermore, actual confusion is not a require- ment under the Lanham Act. Union Carbide Corp. v. Ever- Ready Inc., 531 F.2d 366, 383 (7th Cir. 1976).* The Second Circuit’s view unfairly hampers litigants like Universal which have not had the time to acquire a registered trademark** and were not the first to use the merchandising property in the pertinent market. A virtually impossible burden of proof is placed on the owner of a merchandising property when, as here, survey evidence offered on the issue of likelihood of confusion is rejected on the ground that the persons surveyed did not “necessarily have any present purchasing interest concern- ing American’s hiking boots.” If surveys are to be con- ducted only of actual consumers, then wrongful conduct such as American’s could not be stopped before irreparable harm had occurred. At the time of institution of the law- suit, American’s ‘‘Bionic’’ boots had only been sold in minimal quantities, and an insufficient number of actual consumers were available to survey. It would be improper and unfair to require Universal to wait until American had made substantial use of Universal’s mark before relief can be granted. Rather, the unusually strong ‘‘ generalized link- * Similarly, secondary meaning, discussed by the Court of Ap- peals, is an inappropriate requirement once a merchandising prop- erty is established. The existence of a successful licensing program as shown here, is highly probative, if not conclusive, that ‘‘Bionic’’ has a meaning and value apart from the dictionary meaning of the word. Moreover, the Court of Appeals specifically found ‘‘Bionic’’ to be distinctive (A, p. 15). ** Since the inception of this case, Universal has acquired a number of federal trademark registrations relating to its ‘‘Bionic’’ marks. 20 age’? found by the lower courts between boots labeled ‘‘Bionic’’ and Universal’s television shows, coupled with American’s intent to capitalize on Universal’s ‘‘Bionic’’ mark, should have been held sufficient to establish likelihood of confusion. The result of the split between the Fifth and Second Circuits on the likelihood of confusion test is a lack of uniformity in protecting merchandising properties as trademarks in the United States. A party which seeks to capitalize on another’s merchandising property, similar to the term ‘‘Bionic’’ will be enjoined in Texas; that same party will be free to enjoy the fruits of another’s efforts in New York. CONCLUSION | For the reasons stated, the petition for a writ of certiorari should be granted. Dated: February 5, 1980 Respectfully submitted, Evan L. Gorpon Attorney for Petitioner 50 Broad Street New York, New York 10004 Of Counsel: : Worsey, Certiuman, Harr & Lesow Larr, WuHITEsEL & Rockman RosENFELD, Meyer & Susman Al OPINION OF COURT OF APPEALS UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT ~ No. 505—August Term, 1978. (Argued January 15, 1979 Decided November 9, 1979.) Docket No. 78-7362 > AMERICAN FOOTWEAR CORPORATION, Plaintiff-Appellee, —against— GENERAL FOOTWEAR COMPANY LIMITED, Defendant-Appellant, —and— UNIVERSAL Crty Stupios, INc., Intervening-Defendant-A ppellant. el Before: WATERMAN, GURFEIN and VAN GRAAFEILAND, Circuit Judges. > Appeal from grant of an injunction, S.D.N.Y., Carter, J., enjoining defendant and intervening defen- dant from infringing plaintiff's trademark “Bionic,” 5365 Si a ch 5 MMR a i a I A2 Opinion of Court of Appeals and from on their part asserting exclusive rights to the use of “Bionic” in the promotion and sale of footwear. Injunction order reversed. All parties may use the term “Bionic” with reference to the merchandising of the footwear the parties presently merchandise. District court reversed in part and affirmed in part. | ~>— 7 EvAN L. Gorpon, New York, N.Y. (Wofsey, Certilman, Haft & Lebow, New York, N. Y., Barry J. Bendes, of counsel; Rosenfeld, Meyer & Susman, Beverly Hills, Calif., William Billick,’ of counsel) for Appellants. LAWRENCE ROSENTHAL, New York, N.Y. (Blum, Moscovitz, Friedman & Kaplan, New York, N.Y.) for Ap- pellees. : - WATERMAN, Circuit Judge: Defendant-appellant General Footwear Company Limited (General) and intervening defendant-appellant Universal City Studios, Inc. (Universal) appeal from an interlocutory judgment entered in the United States District Court for the Southern District of New York, Carter, J., granting plaintiff-appellee American Footwear Corporation (American) an injunc- tion against infringement of its trademark “Bionic” in connection with the promotion and sale of footwear. The judgment appealed from enjoins General and Universal from asserting exclusive rights to use of the term “Bionic” in connection with the 5366 A3 Opinton of Court of Appeals promotion and sale of footwear, but in no way in- terferes with Universal’s trademark rights in its T.V. shows or its licensing operations in respect thereto. The district court found that inasmuch as Univer- sal had not registered or applied for registration of “Bionic” as a trademark prior to the time American selected the mark and applied for registration that no statutory trademark issues were involved. Relying primarily upon American’s priority of use, the lower court concluded that American established its right to use “Bionic” in connection with the promotion and sale of its footwear, and therefore, as a result of Universal’s “Buyers Beware” advertisement, designed to create the impression that American was guilty of trademark infringement, American has suffered ir- reparable injury. Based upon the foregoing facts, the court determined that American had established iis entitlement to an injunction against Universal for trademark infringement and unfair competition. Universal and General argue that enjoining them from licensing or using the word “Bionic” in connec- tion with the promotion and sale of footwear because of American’s prior use of the word constitutes an inequitable restriction upon a creator's use of a fan- ciful term and contend that they are entitled to an injunction against American based on American’s un- fair competition in attempting to capitalize upon the success of Universal’s T.V. shows by _ misap- propriating an essential element thereof in the word “Bionic.” Defendants-appellants also contend that American failed under recognized principles of trademark law to establish any of the criteria necessary for the issuance of the injunction granted to it by the district court and urge the dissolution of that injunction. 5367 A4 Optnton of Court of Appeals We are in agreement with the defendants-appel- lants’ contention that American failed to establish the necessary elements for issuance of an injunction and hereby order its dissolution. As to the ap- pellants’ contention that they are entitled to an in- junction restraining American, we find that, because appellants failed to establish a likelihood of confusion such that a substantial number of ordinarily prudent purchasers might be misled into mistakenly purchas- ing American’s footwear, American’s usage of the trademark “Bionic,” although admittedly adopted to capitalize on public receptiveness to a word Universal was responsible for popularizing, does not establish a case of unfair competition or trademark infringement entitling them to enjoin American’s use of the word “Bionic” in connection with the promotion and sale of its hiking boot. This action, a suit for declaratory relief brought in the New York Supreme Court, was initiated on July 30, 1976, by American against General, which, pur- suant to license from Universal, was using “Bionic” in the manufacture and sale of inexpensive children’s sneakers. On August 13, 1976, General, however, removed that action to the United States District Court for the Southern District of New York and on September 20, 1976, commenced a separate action against American in the United States District Court. Universal was granted leave to intervene in both ac- tions. Subsequently the two actions were consolidated for ali purposes. The consolidated action contains the claims by American as plaintiff in its suit against General and Universal for common law trademark infringement, unfair competition, and tortious interference with business relations, and also the claims Universal and 5368 A5 Opinton of Court of Appeals General assert against American in their action for common law and statutory trademark infringement, unfair competition, false designation of origin, pass- ing off, and dilution. The events leading up to the present controversy are lengthy and involve numerous peripherally related facts which will not be discussed at length. Beginning in January 1974 Universal, a_ television and motion picture studio, began what became an immensely popular T.V. series entitled “The Six Million Dollar Man.” The story line of this series con- cerned the adventures of a “bionic” man who, after a catastrophic accident, had been restored by a team of doctors through the use of numerous artificial limbs and organs. As a result, the “bionic” man possessed great physical strength and powers. This series was followed by another with a similar theme featuring a “bionic” woman, first aired in January 1976 under the title of “The Bionic Woman.” Universal has ap- plied for or registered numerous trademarks having reference to these two television shows in the fields of entertainment and of toys, and has begun a vigorous merchandising campaign exploiting the popularity of these two television programs. As of January 1976, however, its only registered mark was for “The Six Million Dollar Man” in the field of entertainment services. In the fall of 1975 American, through its sister company Anwelt Corp., designed a multipurpose hik- ing boot. The trademark “Bionic Boot” was adopted for the hiking boot in January 1976, at a brain- storming session of the American staff. It is un- disputed that the idea for the trademark was generated from the highly popular television series 5369 A6 Opinion of Court of Appeals “The Six Million Dollar Man,” where the hero is sometimes referred to as the “Bionic” man. American searched the records of the U. S. Patent and Trademark Office to ascertain whether “Bionic” had been registered as a federal trademark on footwear or whether there were any pending applica- tions so to register. American was advised that the mark “Bionic” was available for registration and that while “Bionic” or other related terms had been used as trademarks for various goods, the mark “Bionic” had never been registered or applied for in connec- tion with footwear. American, therefore, went ahead with its plans to use “Bionic” as a trademark and displayed the boot under that mark at the New York Shoe Fair in February 1976. The trademark “Bionic” by American was affixed to the heel pad of the boot and was prominently displayed on the box.' Ameri- can’s application for federal registration of the trade- mark “Bionic” was filed on June 9, 1976. The first customer orders for the boot were dated February 1976, and the first shipment to customers was in July 1976. “Footwear News” also featured American’s “Bionic Boot” in its April 26, 1976, supplement. Beginning in December 1975 Merchandising Cor- poration of America, Inc. (Merchandising), the com- 1 American affixes its trademark to its boots on a heel pad as foliows: BIONIC™ BY AMERICAN The gummed label affixed to the box in which the “Bionic Boot” is sold reads as follows: BIONIC™ BOOT BY AMERICAN 5370 A7 Optnton of Court of Appeals mercial arm of Universal, began negotiations with General concerning commercial exploitation of its “The Six Million Dollar Man” series in the footwear field. Although some agreement was reached in March 1976, the district court found that the earliest date at which a license was effectuated was some- time subsequent to October 4, 1976. The court held that “[tJhe licensing agreement as proposed and as finally agreed upon always referjs}] to Six Million Dollar Man and Bionic Woman, and at no -time is there any reference to a trademark Bionic or to licensing the use of Bionic alone or indeed licensing anything separate and apart from the TV shows mentioned.” (Joint Appendix at 15.) As a result of the article in “Footwear News featuring American’s “Bionic Boot,” Universal’s sub- sidiary, Merchandising, sent a letter dated June 25, 1976, to American charging trademark infringement. Thereafter on July 26, 1976, Merchandising pub- lished in “Footwear News” a “Buyers Beware” adver- tisement which stated that Universal alone had the right to use “Bionic” as a trademark and charged trademark infringement against all who used the mark without its permission. At the outset of its opinion the district court found that Universal had not registered or applied for a registration of “Bionic” as a trademark for any goods prior to the time American selected the mark and applied for its registration and accordingly it held that no statutory trademark issues were in- volved. The district court recognized that: It was entirely permissible for American to at- tempt to capitalize on public receptiveness to a concept, idea or word which Universal has been responsible for creating or popularizing. The only 5371 ” A8 Optnion of Court of Appeals limitation is that the party who takes advantage of the atmosphere the other party has helped create may not achieve a competitive boost by confusing the public into mistakenly purchasing his articles believing it to be that of his com- petitor. (citation omitted). American has not been guilty of that fault. It has at all times made clear that the Bionic boot it was attempting to promote was an American product. No effort of any kind was made to associate the boot with Universal’s TV shows or with any of the char- acters in those shows. (Joint Appendix at 17-18.) The court concluded, therefore, that the real issue in that controversy was whether Universal through its T.V. shows had foreclosed use in the marketplace of “Bionic” or “Bionics” by others. The court held that “Bionic” as used by American was an arbitrary mark, whereas its use by Universal was as a descriptive term (i.e. bionic man, bionic woman, bionic boy, 2 Appellants dispute this finding by the district court. They con- tend that American's intent to capitalize upon the popularity of Universal's television shows was evidenced by a poster, showing a woman in a running pose similar to the running pose adopted by Universal's theme characters in the opening segménts of each episode of “The Six Million Dollar Man” and “The Bionic Woman,” which was employed by American as part of the adver- tising display promoting its “Bionic Boot” at the National Shoe Fair held in New York City in February 1976. On the other hand, conceding that American's “Bionic Boots” were not design- ed to be the functional equivalent of track shoes, an advertise- ment for footwear does lend itself to a running pose. Moreover, the similarities between the poster and the scenes from the TV shows are not so marked that, when the poster is displayed together with numerous and prominent references to American and to no other entity, an ordinarily prudent purchaser would be likely to be misled into believing that any sponsorship arrange- ment existed between Universal's TV shows and American's pro- duct. 5372 A9 Optnton of Court of Appeals bionic dog),? and Universal had therefore failed to establish a right to be accorded use priority over American, citing Polaroid Corp. v. Polarad Elec- tronics Corp., 287 F.2d 492 (2 Cir.), cert. denied, 368 U.S. 820, 82 S.Ct. 36 (1961). Additionally, the court held that “(t]he word bionic has not been shown to have acquired a secondary meaning so that the public associates the term with Universal or its TV series” (Joint Appendix at 18). In so holding the court rejected survey evidence in- troduced by Universal that purported to demonstrate public association between the word bionic and the T.V. series.‘ 3 That is to say, Universal's usage of the adjective “bionic” was intended to correspond with that term's dictionary meaning. “concerning the science of designing instruments or systems modeled after living organisms.” 4 At trial Universal offered two surveys conducted under the supervision of Dr. Russell Haley, a telephone survey and a shop- ping center survey. The telephone study was conducted on a national probability sample of individuals 16 years of age or older. 802 individuals were asked a single question: “With whom or what do you associate a product labelled Bionic?” Of the 802 interviewees 34.7% gave no associational response whatsoever and 55" associated a product labeled Bionic with Universal's television shows or their principal characters. Although the latter percen- tage may be significant, the form of the survey question was too self-serving, in that the more relevant inquiry should have been “With whom or what do you associate a ‘Bionic’ boot?” See American Basketball Association v. AMF Voit, Inc., 358 F.Supp. 981, 986 (S.D.N.Y.), affd 487 F.2d 1393 (2d Cir. 1973), cert. denied, 416 U.S. 986, 94 S.Ct. 2389 (1974). The second study, the on-site shopping center survey, involved 307 personal interviews in six shopping centers throughout the country. Each of the interviewees was shown an American pro- motional poster for the “Bionic Boot,” and was then asked: “With whom or what do you associate the term Bionic Boot?” Out of the 307 persons interviewed 74.3% identified the poster ae heing connected with Universal's “The Six Million Dollar Man” or “The Bionic Woman” television series or with their 5373 - ee A10 Opinion of Court of Appeals Universal and General concede that if the term, t.e., word, “bionic” had been used in its descriptive dictionary sense in relation to a product whose func- _tional use would correspond to that descriptive sense, Universal has not foreclosed the use of such a term by others in the marketplace; but they argue that the court, in denying their application for an injunc- tion, misapprehended the nature of their claim. First, Universal argues that it has foreclosed the use of the “television word Bionic” to others due to its efforts and skills in developing and popularizing the word principal characters. Assuming that this percentage is high enough to be significant, the critical defect in this survey was the failure to conduct it under actual marketing conditions. Whenever American had displayed this poster at various shoe fairs or industry trade shows, the poster always was shown in an environment replete with references to American as the seller of the boot. However, once removed from this environment, the poster differed from American's other “Bionic Boot” adver- tisements in that the poster itself did not contain any references to American. This defect was pointed out by the district court during Dr. Haley's testimony, the court stating: . one of the issues in the case is the possibility of confu- sion on the part of the consumer, so it seems to me that us- ing the advertisement in the form that the defendant finds objectionable . . . would get a more accurate response as to whether or not there is the likelihood of confusion with the defendani's product than leaving it off. (Joint Appendix at 698-99); see American Luggage Works, Inc. v. United States Trunk Co., 158 F.Supp. 50, 53 (D.Mass. 1957) (Wyzanski, J.), affd sub nom. Hawley Products Co. v. United States Trunk Co.,'259 F.2d 69 (1st Cir. 1958). Moreover, the survey participants, although former purchasers of hiking boots, did not necessarily have any present purchasing interest concern- ing the particular matter being surveyed. As noted by Judge Wyzanski in American Luggage Works, Inc., supra, 158 F.Supp. at 53, “Many men do not take the same trouble to avoid confu- sion when they are responding to sociological investigators as when they spend their cash,” quoted approvingly in 259 F.2d at 78 Accordingly, in light of these methodological defects, the district court's rejection of this survey evidence was not clearly erroneous. 5374 : All Optnton of Court of Appeals through the television series in which the word is us- ed as part of the title of one of the series and is us- ed as an adjective describing both major characters. Universal contends that this issue before the court is not whether the product is identified as being made by American, but whether the public could confuse the source of the product’s sponsorship and purchase it because of a belief that it had some connection with Universal’s television series. Secondly, appellants argue that Universal’s use of the terms “Bionic Man” and “Bionic Woman” on products marketed by its licensees was, contrary to the finding of the district court, arbitrary trademark use, so that Universal is entitled to protection against a subsequent user of an identical mark, citing Triangle Publications v. Rohrlich, 167 F.2d 969, 972 (2d Cir. 1948); LeBlume Import Co. v. Coty, 293 F. 344, 358-59 (2d Cir. 1923); National Lampoon, Inc. v. American Broadcasting Cos., Inc.. 376 F.Supp. 733, 747-48 (S.D.N.Y.) affd 497 F.2d 1343 (2d Cir. 1974). Also, appellants contend that if Universal's use of the word “bionic” is merely descriptive, the word has acquired a secondary mean- ing and appellants are thereby entitled to equitable protection. The essence of Universal’s and General’s claim of unfair competition and trademark infringement is the adoption by American of the “television word” bionic. In support of their alternative theories of recovery, appellants cite: Triangle Publications v. Rohrlich, supra; Lone Ranger, Inc. v. Cox, 124 F.2d 650 (4th Cir. 1942); National Lampoon, Inc. v. American Broadcasting Cos., Inc., supra; and Wyatt Earp Enterprises v. Sackman, Inc., 157 F.Supp. 621 5375 Al2 Optnton of Court of Appeals (S.D.N.Y. 1958), all of which stand for the proposi- tion that the public, through associating a name or symbol with a particular sponsorship, can be misled as to sponsorship of a product by the overt use by another party of that name or symbol. Hence, ap- pellants reason that if Universal had in fact estab- lished a protectable right in the terms “Bionic Man” or “Bionic Woman” then, under principles of trade- mark law, American has infringed by the use as the dominant portion of its mark, the portion, “bionic,” which most clearly identifies the sponsor of the goods, and therefore American should have been en- joined from the use of “bionic.” Although at one time the law of unfair competi- tion was limited to claims that one party had at- tempted to pass off his goods as those of another party, unfair competition is now held to encompass a broader range of unfair practices which may be generally described as a misappropriation of the skill, expenditures, and labor of another. Flexitized, Inc. v. National Flexitized Corp., 335 F.2d 774, 781 (2d Cir. 1964), cert. denied, 380 U.S. 913, 85 S.Ct. 899 (1965); Ideal Toy Corp. v. Kenner Products Division of General Mills Fun Group, Inc., 443 F.Supp. 291, 305 (S.D.N.Y. 1977). “(Ome cannot sell his product by misappropriating the good will of another through misleading the public into thinking that it is ‘spon- — sored’ by or derived from something else.” Ideal Toy Corp. v. Kenner Products Division of General Mills Fun Group, Inc., supra at 305. Yet, liability in this area for misimpression or misappropriation has been limited. For example, one can capitalize on a market or fad created by another provided that it is not ac- complished by confusing the public into mistakenly purchasing the product in the belief that the product 5376 Al3 Optnton of Court of Appeals is the product of the competitor. Philip Morris, Inc. v. R. J. Reynolds Tobacco Co., 188 U.S.P.Q. 289 (S.D.N.Y. 1975). All the cases in this area which ap- pellants rely upon involved proof of a substantial secondary meaning in plaintiff's arbitrafy trademark, Triangle Publications v. Rohrlich, supra (secondary meaning in mark “Seventeen”), or bad faith predatory conduct justifying relief, Lone Ranger, Inc. v. Cox, supra (bad faith); HMH Publishing Co., Inc. v. Brincat, 504 F.2d 713 (9th Cir. 1974) (bad faith). See also Lincoln Restaurant Corp. v. Wolfies Restaurant, Inc., 291 F.2d 302 (2d Cir. 1961) (deliberate attempt to create name-association). Here the district court found that there was no proof that American’s advertising was built thematically around Universal’s television shows, or that American played down its own name to inspire confusion, or that American acted in any other way except by the use of the word “bionic” to suggest any association with Universal’s television enterprise. In fact, appellants concede that Universal’s merchandising program uses the term “bionic” to describe many products sold under “The Six Million Dollar Man” mark and the “Bionic Woman” mark; therefore, in view of this descriptive usage there would be no apparent reason for a consumer to assume that because the boots bore the mark “Bionic” the creators of “The Six Million Dollar Man” or the “Bionic Woman” were automatically engaging their creations in the spon- sorship of hiking boots. Additionally, there was no evidence of prior dealings between American and Universal as in Wyatt Earp Enterprises v. Sackman. Inc., supra, and National Lampoon, Inc. v. American Broadcasting Cos., Inc., supra, which might tend to 5377 Al4 Optnton of Court of Appeals support a conclusion that American adopted “Bionic” for the purpose of suggesting an association with Universal’s television series. Therefore, while American certainly intended to capitalize on Univer- sal's popularization of the word “bionic,” we find that. it did not so capitalize by confusing consumers. Challenging the findings of the district court, ap- pellants also contend that by virtue of Universal’s ef- forts in promoting its television programs the word “bionic” has come to be equated with the notion of enormous strength and superhuman ability as op- posed to its dictionary definition (“The science of designing instruments or systems modeled after liv- ing organisms”) and has, therefore, acquired a secondary meaning. We previously have discussed the district court’s disposition of this argument. Although we do not subscribe to. the view, arguably implicit in the district court’s reasoning, that survey evidence gathered for later use in litigation invariably is suspect and not relevant to the issue of secondary meaning, Union Carbide Corp. v. Ever-Ready, Inc., 531 F.2d 366, 381 (7th Cir. 1976), we are of the opinion that, in view of the numerous deficiencies in- herent in the surveys here, the district court’s rejec- tion of this survey evidence was not clearly er- roneous. See footnote 4, supra. The doctrine of secondary meaning requires not only that the mark have a subordinate meaning, but also that the primary significance of the mark in the minds of the consumers is the identification of the producer, not a designation of the product. See Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 59 S.Ct. 109 (1938); Spang v. Watson, 205 F.2d 703 59378 A1L5 Opinton of Court of Appeals (D.C.Cir.), cert. denied, 346 U.S. 938, 74 S.Ct. 378 (1954); Blisscraft of Hollywood v. United Plastic Co.. 189 F.Supp. 333 (S.D.N.Y. 1960), aff'd in part, revd in part on other grounds, 294 F.2d 694 (1961). So. when a company causes the public to associate a cer- tain word with that company’s business, that word has a secondary meaning and receives the full protec- tion of the law of trademark and unfair competition. The crucial question in a case involving “secondary meaning” always is whether the public is moved in any degree to buy an article because of its source. See Wyatt Earp Enterprises, Inc. v. Sackman, Inc.. supra. Proof of secondary meaning is often difficult inasmuch as no precise guidelines are applicable and no single factor is determinative. Each case must. therefore, be decided on its facts with consideration given to such elements as the length and exclusivity of use, sales levels, and extent of advertising and promotion. The fact that Universal has succeeded in popularizing the word “bionic,” and cultivated public acceptance of a relatively unknown word, while suffi- cient to support a finding of distinctiveness, Alfred Dunhill of London, Inc. v. Kasser Distillers Products Corp., 350 F.Supp. 1341, 1359 (E.D.Pa. 1972), aff d, 480 F.2d 917 (3d Cir. 1973); Time Mechanisms, Inc. v. Qonaar Corp., 422 F.Supp. 905, 912 (D. N.J. 1976), is insufficient to support a finding of secon- dary meaning. Furthermore, the fact that Universal invested in excess of $20,000,000 in the production of its television shows and received royalties in ex- cess of $10,000,000 from its merchandising program. as compared with American’s minimal advertising ex-: penditures in the promotion of its “Bionic Boot’ (ap- ‘ proximately $3,000), while relative to the issue of 9379 Al6 Opinton of Court of Appeals secondary meaning, is certainly not dispositive. HMH Publishing Co. v. Brincat, supra at 719. For just as the expenditure of large sums of money does not in and of itself create legally protectable rights, so, too, the mere presence of extensive advertising does not assure the existence of a likelihood of confusion. HMH Publishing Co. v. Brincat, supra. Appellants’ survey relative to consumer reactions to boots labeled “Bionic” only demonstrated a generalized linkage with Universal’s television programs and did not demonstrate the existence of any consumer confusion as to sponsorship or source of manufacture. Such is insufficient to establish a secondary meaning in the word. Appellants’ trademark theory of recovery is no more persuasive than its misappropriation theory. It overlooks the well-established principle that trade- mark rights, unlike statutory copyrights or patents, are not rights in gross or at large. “There is no such thing as property in a trade-mark except as a right appurtenant to an established business or trade in connection with which the mark is employed.” United Drug Co. v. Theodore Rectanus Co., 248 US. 90, 97 (1918). The right, therefore, to exclusive use of a trademark derives from, and is limited by, its actual use in the marketplace. La Societe Anonyme des Par- fums Le Galion v. Jean Patou, Inc., 495 F.2d 1265, 1271 (2d Cir. 1974). The test, under both the Lanham Act and the common law, is the likelihood that the consuming public will be confused as to the source of the allegedly infringing product. See Mushroom Makers, Inc. v. R. G. Barry Corp., 441 F.Supp. 1220, 1225 (S.D.N.Y. 1977), aff'd, 580 F.2d 44 (2d Cir. 1978); Maternally Yours v. Your Materni- 5380 Al7 Optnton of Court of Appeals ty Shop, 234 F.2d 538 (2d Cir. 1956). As has often been observed, the law of trademark infringement is but a part of the law of unfair competition, Hanover Star Milling Co. v. Metcalf, 240 U.S. 403, 413, 36 S.Ct. 357 (1916), and the same test is applied in determining each claim. For confusion to arise the markets need not be identical, Scarves by Vera, Inc. v. Todo Imports, Ltd. (Inc.), 544 F.2d 1167 (2d Cir. 1976), but the similarity of the markets or products is a factor meriting the consideration of the likeli- hood of confusion. Mushroom Makers, Inc. v. R. G Barry Corp., supra. The trademarks registered to Universal were in the areas of T.V. entertainmcut and toys. This market area bears little if any rela- tionship to footwear, and diminishes the strength of Universal's contention that it had established a right to the term “bionic” as a fanciful mark in the field of footwear. Yet, as recognized by the district court, the fact that Universal had not utilized the mark, registered it, or applied for the mark on footwear is not decisive of the issue, for a trademark owner has a right to protection against the use of the mark by third parties on related non-competing goods. The district court determined that American, by virtue of the fact that it was the first user of the arbitrary mark “Bionic” in connection with the promotion and sale of footwear, as contrasted with Universal's purely descriptive use of the term bionic, had established its entitlement to an injunction against Universal and General for trademark infringement and unfair competition and Universal’s “Buyers Beware” advertisement was the basis of the court's finding that American had suffered irreparable in- jury. This finding, coupled with the court'’s conclusion 5381 Als Opinion of Court of Appeals that American had acquired common law trademark rights to “Bionic” in the field of footwear, con- stituted the factual and legal bases for the award of injunctive relief. Also, the court held that under the standards set forth in Polaroid Corp. v. Polarad Elec- tronics Corp., supra at 495, Universal had failed to establish a right to be accorded priority over American in the area of the merchandising of foot- wear. The question of whether a senior user is entitled to protection against a junior user on non-competitive goods was addressed by this court in Polaroid Corp. v. Polarad Electronics Corp., supra. The factors sug- gested in Polaroid include, but are not limited to: [T]he strength of his mark, the degree of similarity between the two marks, the proximity of the products, the likelihood that the prior owner will bridge the gap, actual confusion, and the reciprocal of defendant’s good faith in adopt- ing its own mark, the quality of defendant’s product, and the sophistication of the buyers. Polaroid Corp. v. Polarad Electronics Corp., supra at 495. It has long been established in this circuit that the mere fact of seniority alone does not entitle the first user of a trademark to injunctive relief. The deter- mination is to be made on the basis of the equities involved, and thereby requires an evaluation of the legitimate interests of the senior user, the junior user, and the consuming public. Chandon Champagne Corp. v. San Marino Wine Corp., 335 F.2d 531, 534 (2d Cir. 1964). Therefore, to the extent that American sought relief for trademark infringement 9382 Al9 Optnton of Court of Appeals under the Lanham Act, 15 U.S.C. §114, it was necessary for it to prove the elements of trademark infringement. See Scarves by Vera, Inc. v. Todo Im- ports, Ltd. (Inc.), supra; Kiki Undies Corp. v. Prom- enade Hosiery Mills, Inc., 411 F.2d 1097, 1099 (2d Cir. 1969), cert. dismissed, 396 U.S. 1054 (1970): Polaroid Corp. v. Polarad Electronics Corp., supra. American has clearly failed to meet this burden. First, “Bionic” is a relatively new mark and therefore could not be considered a particularly strong mark in the marketplace. Second, there is little comparability between the expensive hiking boots sold by American and the inexpensive children’s sneakers sold by Universal’s licensee, General. The dissimilarities in the products (i.e, hiking boots vs. children’s sneakers) also have an_ indirect bearing on the marketplace sophistication of buyers inasmuch as the purchasers of American’s hiking boot undoubtedly are not motivated by the same considerations as pur- chasers of “The Six Million Dollar Man” or “Bionic Woman” “Bionic Sneakers.” American has not brought its case within the Polaroid factors. American, the senior user, is not “bridging the gap.” It is Universal, the junior user, which is expanding into new fields (i.e., footwear) and not American. As to the quality of General’s product, American made no claim in the court below and none here that it was concerned with General’s competition in manu- facturing and selling children’s sneakers. And, finally, American presented no evidence on the crucial issue, essential to sustain a finding of trademark infringe- ment, of whether there was likely to be consumer confusion by the use of the mark by Universal and General. In fact, the only evidence presented on the 5383 A20 Optnton of Court of Appeals issue of consumer confusion was the survey evidence offered by appellants, a survey which failed to establish the likelihood of such confusion and the results of which were rejected by the district court. We find, after consideration of all pertinent fac- tors under trademark principles and the law of un- fair competition, that neither party has demonstrated entitlement to equitable protection of their respective marks and hereby order the dissolution of the injunc- tion entered against appellants herein. In so holding, we do, however, adopt the suggestion made by ap- pellants that inasmuch as Universal’s and General's use of the word “Bionic” was clearly accompanied by references to the respective television series, and that all the footwear made by General contained the name of the television series elsewhere on the footwear, that American will be permitted to con- tinue to market its “Bionic Boot” simultaneously with permitting Universal and General to exploit fully Universal’s creativity by simultaneously marketing the “The Six Million Dollar Man” and the “Bionic Woman” “Bionic Sneakers.” Inasmuch as the district court did not address the pendent state claims under section 368d of the New York General Business Law (N.Y. Gen. Bus. Law § 368d) and therefore made no findings of fact or conclusions of law with respect thereto, we deem it inappropriate to address those issues on appeal. Opinion of district court reversed in part; affirmed in part. 5384 570—11-13-79 © USCA—4498 OUTPUT SYSTEMS, INC., 157 Chambers St., N.Y. 10007, (212) 374-1234 A2l Judgment of Court of Appeals. UNITHD STATES COURT OF APPEALS For THE Seconp Circuit At a stated Term of the United States Court of Appeals for the Second Circuit, held at the United States Court- house in the City of New York, on the ninth day of Novem- ber, one thousand nine hundred and seventy-nine. Present: Hon. Sterry R. Waterman Hon. Murray I. Gurrern Hon. ExtswortaH A. Van GRrAaFEILAND Circuit Judges 78-7362 AMERICAN FoorwEar CorPorRATION, Plaintiff-Appellee, v. GeneRAL Foorwear Company LimirTep, Defendant-Appellant, UntversaL Crry Srupios, Inc., Intervening-Defendant- Appellant. Untversat Crtry Srupios, Inc. and GeneraL Foorwear Company LiMiTED, Plaintiffs-Appellants, v. AMERICAN FooTwEar CoRPORATION, Defendant-Appellee. + A22 Judgment of Court of Appeals. Appeal from the United States District Court for the Southern District of New York. This cause came on to be heard on the transcript of record from the United States District Court for the Southern District of New York, and was argued by counsel. On ConsmeraTiION WHEREOF, it is now hereby ordered, adjudged, and decreed that the judgment of said District Court be and it hereby is affirmed in part and reversed in part in accordance with the opinion of this court. A. Dante, Fousaro, Clerk ARTHUR HELLER By: Arthur Heller, Deputy Clerk A23 Opinion of the District Court. UNITED STATES DISTRICT COURT SourHern District or New York File-in 76 Civ. 3594 sé v— AMERICAN Footwear CorPoRATION, Plaintiff, —against— GenerRaAL Foorwear Company Limirep and UnrversaL City Srupios, Inc., Defendants. 76 Civ. 4189 Untversau Crry Strupios, Inc. and Genrerat FoorwEar Company LimitTep, Plaintiffs, —against— AmeERICAN Footwear Corporation, Defendant. OPINION The Parties American Footwear Corp. (‘‘American’’) is a Massa- chusetts corporation, having its principal place of business in Fitchburg, Massachusetts. American and its sister com- pany, Anwelt Corporation (‘‘Anwelt’’), are now engaged A24 Opinion of the District Court. in the manufacture and sale throughout the United States of high quality footwear ranging in price from $30 to $80 retail. Anwelt has been in operation since 1926, and Ameri- can since 1965. American sells its products to retailers throughout the United States under the mark American. Anwelt sells Anwelt and American products at retail fac- tory stores in Fitchburg and in Keene, New Hampshire. Both companies sell in volume to large chains under the latters’ private ldbels. The companies promote their prod- ucts through salesmen and manufacturer representatives, in catalogs, bulletins, trade journals and general advertis- ing, and at national and regional trade shows. General Footwear Company Limited (‘‘General’’) is a Canadian corporation having its principal place of busi- ness in Montreal, Quebec, Canada. It has been in the business of importing, manufacturing and selling footwear in Canada for many years and more recently in the United States. It is a licensee of Universal in the footwear field— thé scope ahd nature of the license to be determined in the resolution of this cotitroversy. Universal City Studios, Inc. (‘‘Universal’’) is a Dela- ware corporation with its principal place of business in Universal City, California. It is in the business of making and distributing TV motion pictures and is the producer of the TV series ‘‘Six Million Dollar Man” and ‘The Bionic Woman.”’’ Merchandising Corp. of America, Inc. (‘‘Merchandis- ing’’) is a California corporation with its principal place of business in Universal City, California. Merchandising is in charge of licensing rights to the use of ‘‘Six Million Dollar Man’? and ‘‘The Bionic Woman”’ in the promotion of various commercial products of third parties. Both Universal and Merchandising are wholly-owned subsidiaries of MCA, Ine. (‘‘MCA’’) whose principal place of business is also in Universal City. MCA is not a party to this action. A25 Opinion of the District Court. The Proceedings This action was initiated on July 30, 1976, by American against General as a suit for declaratory relief brought in the New York State Supreme Court, New York County. On August 13, 1976, General removed the action to this court. On September 20, 1976, General commenced a sep- arate action against American in this court. Universal was granted leave to intervene in both actions, and the two actions were subsequently consolidated for all purposes. The consolidated action involves claims by American as plaintiff in its suit against General and Universal for common law trademark infringement, unfair competition and tortious interference with business relations. Univer- sal and General assert claims against American in their action for common law and statutory trademark infringe- ment, unfair competition, false designation of origin, pass- ing off and dilution. As defendants the parties have filed as counterclaims the various canses of action they assert as plaintiffs. All causes of action in this litigation arise from a claim by American to common law trademark rights in the trade- mark Bionic for its shoes and boots. This claim is con- tested by Universal which asserts a right, both at common law and statutory, to the exclusive use of the trademark Bionic on all commercial goods, including shoes and boots and tue right to bar all others from use of the mark Bionic except pursuant to a valid license agreement for such use with Merchandising. General asserts as Universal’s licensee the exclusive right to use the trademark Bionic on footwear. American seeks a permanent injunction against Universal and General for trademark infringement and unfair competition. Universal and General seek sim- ilar relief from American. Both sides seek an accounting for profits. A26 Opinion of the District Court. The case was tried September 26 though September 28, 1977. Proposed findings of fact and conclusions of law and memoranda of authorities were filed in November, 1977. The Facts Relevant to Right to Permanent Injunctive Relief In the fall of 1975, Anwelt and its supplier, Sango Shoe Manufacturing Co., designed a multi-purpose boot good for hiking and mountain climbing which is said to have some novel features enabling the boot to be both light and sturdy. Some $50,000 in development costs were expended. The boot was manufactured exclusively for Anwelt and American, and American sold the boot to J. C. Penny under a private label, not in issue here, and to retailers under the trademark Bionic. That trademark was adopted in January, 1976, at a brainstorming session of the American staff called to provide a name for the new boot. It is undisputed that the idea for the trademark was generated from the highly popular TV series “Six Million Dollar Man” where the hero is referred to from time to time as the bionic man, and in which other characters are referred to as bionic (boy, woman, dog). A second such TV series entitled “The Bionic Woman” was aired beginning in January, 1976. American caused a search to be made by its counsel of the records of the United States Patent and Trademark office to ascertain whether Bionic had either been regis- tered as a federal trademark on footwear or whether any application for such registration had been filed. The search was undertaken, and American was advised that the name was available; that while Bionic or related terms had been used as a trademark for various goods, the mark had never been registered or applied for in connection with footwear. A27 Opinion of the District Court. At the time of the search, Universal had registered “Six Million Dollar Man” as a trademark covering entertain- ment services through TV movies—the issue date was November 18, 1975. An application was on file for “Six Million Dollar Woman” covering toy dolls and that mark was subsequently registered, its issue date being March 1, 1977. Similarly, an application was on file for “Bionic Woman,” covering entertainment services through TV movies, and for “The Bionic Woman,” covering toy dolls of the action figure type. Registration of each of these marks was approved—the issue date for “Bionic Woman” (entertainment) being February 15, 1977 and for “The Bionic Woman” (toys) being April 12, 1977. In addition, Universal had applied on March 25, 1976 for registration of “Bionic Bustout” covering toys but its application was filed after the search on American’s behalf had been com- pleted. That mark (“Bionic Bustout”) was registered on September 21, 1977. Moreover, since this action was com- menced, Universal has filed a number of applications seek- ing registration of the mark Bionic alone in connection with various articles, e.g., optical viewers, eyeglasses, and footwear. Armed with the results of the search showing no prior registration or application, American went ahead with its plans to use Bionic as a trademark in connection with the sale and promotion of its new hiking boot. It displayed the boot under the trademark Bionic at the New York Shoe Fair on February 7, 8, 1976. The boot and the mark Bionic were exhibited at the American booth at the fair, and American was clearly indicated as the source. The first customer orders bearing the trademark Bionic are dated February 8, 1976. American placed its first order for the boot with Sango, its supplier, on February 18, 1976, and made the first shipment to customers on July 2, 1976. The boot was sold throughout the United States at A28 Opinion of the District Court. $32-$40 retail. The trademark Bionic by American has been affixed to the heel pad of the boot and also is prom- inently displayed on the box in which the boot is sold. American’s application for federal registration of the trademark was filed in June 9, 1976. Universal and General negotiated a license agreement in 1976. General was interested in making a breakthrough into the American market. It was felt that a license under ‘*The Six Million Dollar Man’’ and ‘‘The Bionic Woman’”’ TV shows, pursuant to which the characters in these popu- lar shows could be exploited and the stars could be used to aid promotion, would help to establish a following for General’s products in the United States. The negotiations for the licensing agreement commenced in December, 1975, and concerned the terms under which General would be licensed to use the Universal TV series (‘‘Six Million Dol- lar Man’’ and ‘‘ Bionic Woman’*) and the characters therein to help General promote a line of footwear on the Ameri- can market. The licensing agreement as proposed and as finally agreed upon always refer to Six Million Dollar Man and Bionic Woman, and at no time is there any refer- ence to a trademark Bionic or to licensing the use of Bionic alone or indeed licensing anything separate and apart from the TV shows mentioned. Defendants testified that agrement was reached in March, 1976. However, a September 15, 1976, letter mailed to General proposes to license General to use the rights ac- quired only in connection with the sale of ‘‘girls’ casual footwear, slippers, rain footwear and sneakers—the con- struction composed of canvas, leather or rubber.’’ There is a letter dated October 4 from General to Merghandising seeking changes in the proposed contract of September 15 — and the agreement, as signed, excludes the use by General of Universal’s trademark on the boots—at issue here. Ac- cordingly, sometime subsequent to October 4, 1976, is the A29 Opinion of the District Court. earliest date a license to General can be said to have been effected, and that license does not include the right to use “Six Million Dollar Man” or “Bionic Woman” or the char- acters in that TV series on boots. Footwear News selected the American Bionic boot to feature in its April 26, 1976 supplement. In the Footwear News’ display the mark Bionic and American as the source are prominently displayed. This issue of Footwear News was seen by someone at General. General advised Mer- chandising by letter dated May 10 that American was using the trademark Bionic in connection with the promotion of its hiking boot. In a telegram to General, dated July 10, Merchandising suggested that General move quickly into the market. On June 25, Merchandising sent a letter to American charging trademark infringement. Because of vacation schedules the letter was actually not seen by anyone in authority at American until July 19. On J uly 26, 1976, Merchandising had published in Footwear News a buyers beware article in which it claimed that Universal alone had a right to use Bionic as a trademark, charging trademark infringement against all who used the mark, without its permission. These two suits followed. In preparing for this trial, Merchandising or its counsel employed Russell Haley & Associates, Ine. to conduct a survey purportedly to deter- mine the extent to which the consumer public associated the term Bionic as used on a boot with Universal’s TV shows. The survey and its import will be discussed in more detail infra. Discussion It is clear that Universal had not’ registered or applied for registration of ‘‘Bionic’’ as a trademark on any goods prior to the time American selected the mark and applied A30 Opinion of the District Court. for its registration. At the time the only registered trade- mark Universal owned was ‘‘Six Million Dollar Man.’’ Applications for registration were on file for ‘‘Bionic Woman’”’ and ‘‘The Bionic Woman,’’ in connection with toy dolls and TV shows. There was no registered trade- mark or application therefor by Universal of any kind covering footwear. Accordingly, no statutory trademark issues are involved. The ‘‘Six Million Dollar Man’’ was a very popular TV show, and it helped bring the term bionic into more com- mon usage. The word bionic appears in the 1955 edition of the New Standard dictionary of the English Language (Funk and Wagnal) and is there defined as possessing the quality of repeating in successive generations the same morphological characteristics. Bionics is defined in the New World Dictionary 1970 edition as ‘‘The science of de- signing instruments or systems modeled after living or- ganisms.” Yet it is fair to say that until Six Million Dol- lar Man’s reference to bionic man, bionic boy, bionic dog and bionic woman, that neither bionics nor bionic were well known or widely used words. It is also clear that Universal’s TV series ‘‘Six Million Dollar Man’’ gave American the inspiration to adopt Bionic as a trademark, but that fact alone does not make out a case of trademark infringement. It was entirely permis- sible for American to attempt to capitalize on public re- ceptiveness to a concept, idea or word which Universal has been responsible for creating or popularizing. The only limitation is that the party who takes advantage of the atmosphere the other party has helped create may not achieve a competitive boost by confusing the public into mistakenly purchasing his articles believing it to be that of his competitor. Philip Morris Inc. v. R. J. Reynolds Tobacco Co., 188 U.S.P.Q. 289 (S.D.N.Y. 1975). American has not been guilty of that fault. It has at all times made A31 Opinion of the District Cowtt. clear that the Bionic boot it was attempting to promote was an American product. No effort of any kind was made to associate the boot with Universal’s TV shows or with any of the characters in those shows. Universal in the TV series used bionic as a descriptive term—e.g., bionic boy, bionic dog—and in 1976 started a TV series entitled “Bionic Woman’”—again Bionic being used in a descriptive sense. The word bionic has not been shown to have acquired a secondary meaning so that the public associates the term with Universal or its ‘TV series. It is quite clear, however, that both shows have become very popular, and that Merchandising’s licensing program was successfully capitalizing on that fact. A wide variety of licensing agreements have been concluded. However, all of the agreements are associated directly with the TV shows or the characters depicted therein. Generally, pic- tures of the TV stars who fill the role of “The Six Million Dollar Man” and “The Bionic Woman” are prominently displayed on the packaging of the licensed product. None of the licenses are for the use of the mark Bionic alone. In Polaroid Corp. v. Polarad Electronics Corp., 237 F. 2d 492, 495 (2d Cir.), cert denied, 368 U.S. 820 (1961) and Triumph Hosiery Mills, Inc. v. Triumph International Corp., 308 F.2d 196, 198 (2d Cir. 1962), the measurements for approach to trademark infringement cases were set forth, and in Chandon Champagne Corp. v. San Marino Wine Corp., 335 F.2d 531, 536 (2d Cir. 1964) ; Kiki Undies Corp. v. Promenade Hosiery Mills, Inc., 411 F.2d 1097, 1099-1100 ‘(2d Cir. 1969), cert. dismissed, 396 U.S. 1054 (1970) ; and King Research, Inc. v. Shulton, Inc., 454 F.2d 66, 68-69 (2d Cir. 1972), these criteria were expanded to the current yardstick. The above cases indicate that the factors to be consid- ered are the strength of the mark, the degree of similarity, the proximity of the products, the likelihood that the prior A32 Opinion of the District Court. owner will bridge the gap, actual confusion, the reciprocal of defendant’s good faith in adopting the mark, the quality of defendant’s product, sophistication of the buyer, and the severe harm an injunction might cause the defendant against a small benefit to the defendant. The fact that Universal had not utilized the mark, reg- istered it, or applied for the mark on footwear is, of course, not decisive. A trademark owner has a right to protec- tion against use by third parties on related non-competing goods, see e.g.: Yale Electric Corp. v. Robertson, 26 F.2d 972 (2d Cir. 1928) (flashlights v. locks); L. E. Waterman Co. v. Gordon, 72 F.2d 272 (2d Cir. 1934) (mechanical pens and pencils v. razor blades); S. C. Johnson & Co., Inc. v. Johnson, 116 F.2d 427 (2d Cir. 1940) (waxes and floor cleaners v. fabric cleaners); Triangle Publications, Inc. v. Rohrlick, 167 F.2d 969 (2d Cir. 1943) (magazines v. girdles); Pure Foods, Inc. v. Minute Maid Corp., 214 F.2d 792 (5th Cir. 1954) (juices v. meats); Safeway Stores, Inc. v. Safeway Properties, Inc., 307 F.2d 495 (2d Cir. 1962) (groceries v. real estate); Communications Satellite Corp. v. Comcet, Inc., 429 F.2d 1245 (4th Cir.), cert. de- nied, 400 U.S. 942 (1970) (satellites v. computers) ; Scarves By Vera, Inc. v. Todo Imports, Ltd. (Inc.), 544 F.2d 1167 (2d ‘Cir. 1976) (scarves v. fragrances), and as was said in Scarves By Vera, Inc., swora, when the claims for in- fringement have been rejected, the holding allowing use on the non-competing goods has been precisely defined. Id. at 1172. A trademark, however, must be appurtenant to an es- tablished business, Capital Temporaries, Inc. of Hartford v. Olsten Corp., 506 F.2d 658, 663 (2d Cir. 1974), and the rights of ownership of a mark arises from its prior use in connection with a particular product or service. Com- puter Food Stores Inc. v. Corner Store Franchises, Inc., 176 U.S.P.Q. 535 (TTAB 1973). American was clearly the A338 Oninion of the District Court. first to use the mark Bigni¢ in cqnnection with footwear. The real issue in this case, therefore, is whether Uni- versal through its TV series has foreclosed use af Bionic ar Bionics by others in the market plage. We think such # claim is too brgad. Universal] holds no trademark, registered or otherwise, in respect of footwear. Moreover, yntil American reegived publicity for its Bionie boot, Dni- versal had made no attempt to utilize Bionic as a mark. It was gontent to use and to license the use of its “Six Million Dollar Man” and “Bionic Woman” to various and sundry manufacturers of articles geared to the young so that TV shows and the characters portrayed therein could help promote these licensed products. Biqnie as used by American is clearly an arbitrary mark but as used by Universal it is merely a descriptive term—bionie boy, bionie man, ete. Agcordingly, Universal, under the stand- ards set forth in Polaroid Corp. and cognate cases, supra, has etablished no right to be aceorded priority over Amer- ican. The latter as the first user with an arbitrary mark is, however, entitled to protection. There is no likelihcod that the publie will confuse Ameri- can’s Bignic boot as emanating from or having connection with Univergal or any of the Jatter’s licensees. American is not utilizing pictures of Universal’s TV characters or making any reference whatsoever to them in the promo- tien and sale of its produet. It has made clear that the boot is an American product, and there can he no confu- sion as to the souree. American, unlike the defendant in HMH Publishing Co., Inc. v. Brinecat, 504 F.2d 713 (9th Cir, 1974), is not attempting to exploit the reputation and good will engendered by the TV shows. It has clearly identified its products to show that the source of the boot is American, and thus its exploitation of the suceess of the TV shows that have been popularizing Bionic as a word does not render it subject to injunction for infringement. A34 Opinion of the District Court. See Bese Corp. v. Linear Design Labs, Inc., 467 F.2d 304 (2d Cir. 1972). Universal introduced evidence of a survey which pur- ported to show that the public related bionic to its TV shows. The survey was designed, not as an unbiased scientific measure of the public’s pulse but as a weapon in litigation to support the client’s cause. In any event, surveys are only relevant insofar as they throw light on the issue of the likelihood of confusion. American in its sales and promotion of its Bionic boot clearly identifies American as the source, hence a survey showing that in the abstract, and then only when prodded sufficiently, a significant part of the public may relate bionic to Uni- _ versal’s T'V series, does not show that the public will make such a connection when it seeks to by or sees a display of a Bionic Boot identified as a product of American. American has established its right to use Bionic in con- nection with the sale and promotion of its footwear since it is the first user. American has established irreparable injury to itself by virtue of Universal’s buyer beware advertisement which was designed and gave the public, including American’s customers and potential customers, the impression that American was guilty of trademark infringement in the promotion of its Bionic boot. Ameri- can has established its right to a permanent injunction against Universal for trademark infringement and unfair competition. General has no standing as a plaintiff since its license from Universal limits its rights to exploit the TV series and characters to footwear not related to boots for hiking or mountain climbing. However, that field of footwear is certainly closely related to American’s and having ac- quired common law trademark rights to Bionic in foot- wear, American is entitled to have General enjoined from engaging in acts of infringement and unfair competition. See Yale Electric Corp. v. Robertson and cognate cases, supra. A35 Opinion of the District Court. The injunction to be issued in this case, however, is to be clearly understood as in no way interfering with Uni- versal’s trademark rights in its TV shows or its licensing operations in respect thereto. American seeks an account- ing. While I am reasonably confident an accounting will produce little in the way of proved damages, American is entitled to one if it insists. Settle order. Dated: New York, New York May 31, 1978 Robert L. Carter Rosert L. Carrer U.S.D.J. A326 Deposition of Gary Evans. Q: And you have no recollection of the other names? A. I do know that somebody said the word Bionic, and I said that sounds good. Let’s have it checked out. Q. And you don’t reeall who suggested it? A. No, I don’t. Q. But you do recall it wasn’t you? A. That is right. I believe I liked it as soon as I heard it. Q. As soon as you heard Bionic, did those television programs that we discussed earlier come to mind? A. To a degree, I suppose they did. Q: Do you watch Bionic Man? A.I personally don’t watch it, but I have children. I have caught glimpses of it. Q. Have you eaught glimpses of the Bionic Woman? A. I believe I saw just a very short glimpse of that just recently, as a matter of fact. Naturally, since I had some- body write down all the ads the Bionic Man did after the New York shows. Q. Could you explain that to me? A. I just wanted to see what they advertise, what media they were after. Q. They being? A. The people that were buying com- mercial time on the Bionic Man. Q. The sponsors for the program? A. Yes, the sponsors. Q. What field they were in? A. Yes. Q. I see. You had indicated that you had someone run through the ads that were placed on the T.V. program sometime after the trade show. When was that done? A. Well, I had my wife mark them down when we were in Montreal. Q. Just by viewing the show? A. Yes. Q. And jotting down who else was advertising? A. Yes. Q. Was that following the February or the August show? A. The August show. Q. Presumably sometime the end of August or Septem- _ber? A. I could get the exact dates, but we were in Mon- treal, Canada, at that particular time. A37 Deposition of Gary Evans. Q. Did you communicate to the group the association that you had made when you heard Bionic with the téle- visioh programs? Was there sothe way you communciated that? A. Not that I recall. Q. Was there anybody élse that related that informa- tion to yout A. Not that I recall. Q. Did anybody ever communicate that thought to you prior to a letter that Mr. Ansih referred to this morning that American had received from Universal? Prior to that time, did anyone within your group or elsewhere with reference to your choice of Bionic say that is like the Bioni¢ Man or Bionic Woman? A. Someone within our organization? Q. Or otherwise. A. As I recall, there was people at the show. Q. The show would have been after the letter I réferred to. The letter would have been in July. So; I am asking you beforé the letter just for a period: The letter would have been say mid July. A. The association with our boot in relation to the television programs? Q. Right. You have told us about the association that you made, and I am saying to you had dhyone else made that association td you in any context? A: Not that I can recall specifically examples of where people came up and related is that something the Six Million Dollar Man would wear. - Q. Not something that specific, but ariyway referred to the television program in the conversation of your boots? A. I don’t know whether they tied in specifically to the television program. : Q. Suppose they didn’t tie it in specifically. Do you recall in connettion with any tie-in? A. Well, going back to my adopting the name at the office there that time, I did know that the Bionic Man was like a Superman, sup- posed to be very strong; jumped buildings, things like that. And this is & very strong boot, so theré was some tie-in there. A38 Deposition of Gary Evans. Q. und this is a tie-in that you made? A, Yes. Q. In associating Bionic for boots and Bionic for the program. I understand that you told us you don’t recall having expressed that association to any of your fellow workers?