Seattle Trademark Lawyer

On Sept. 10, the Eastern District of California found that Nikepal International, Inc.’s use of NIKEPAL in connection with laboratory goods and services dilutes by blurring Nike, Inc.’s NIKE trademarks under the Trademark Dilution Revision Act’s likelihood of dilution standard. For this reason, the court also reversed the Trademark Trial and Appeal Board’s dismissal of Nike’s opposition to Nikepal’s registration of NIKEPAL. On Sept. 18, the court amended its findings of fact and conclusions of law, which are available here. (STL previously discussed the court’s order on summary judgment here.)

Nike has used NIKE in connection with athletic shoes, apparel, and sports equipment since the 1970s. It owns ten federal registrations for the NIKE word mark alone, and 19 others involving the word NIKE. It is the largest athletic seller of athletic footwear and apparel in the world.

Nikepal has used NIKEPAL in connection with glass syringes and other laboratory goods and services since 1998. It has two part-time employees. It operates entirely through its Web site, www.nikepal.com, email, and the telephone. In 2000, it applied for a trademark registration for NIKEPAL for “import and export agencies and wholesale distributorships featuring scientific, chemical, pharmaceutical, biotechnology testing instruments and glassware for laboratory use, electrical instruments, paper products and household products and cooking appliances.”

After a bench trial, Judge Garland Burrell, Jr., found that NIKE was famous, since “[b]y the 1990s, Nike had spent in excess of a billion dollars for promotion of NIKE products in the United States”; sales of NIKE products reached the billion dollar per-year level before Nikepal adopted the mark; and NIKE is registered on the Patent and Trademark Office’s principal register.

The TDRA defines dilution by blurring as an “association arising from the similarity between a mark or trade name and a famous mark that impairs the distinctiveness of the famous mark.” 15 U.S.C. § 1125(c)(2)(A). The court concluded Nike had established dilution by blurring under each part of the TDRA’s six-factor test because: “The parties’ marks are nearly identical”; NIKE is inherently distinctive; Nike’s use of NIKE is substantially exclusive; NIKE is readily recognized; Nikepal’s owner was aware of NIKE before he adopted his company’s name; and Nike’s survey evidence showed that 87% of the people in Nikepal’s own customer pool associated the stimulus “Nikepal” with NIKE.

The court entered a permanent injunction preventing Nikepal from using the term “Nike” or any term confusingly similar thereto alone or as part of any trademark, domain name or business name under which Nikepal offers goods or services in commerce.

The court also reversed the TTAB’s decision dismissing NIke’s opposition to the registration of the NIKEPAL mark on the ground that Nike had presented new evidence, namely, a survey showing “the vast majority of the survey respondents, representing a significant segment of Nikepal’s target customer group, associate Nike and/or its products and services when they encounter NIKEPAL, thus perceiving the two marks as essentially the same.” This, the court found, compelled reversal of the TTAB’s decision.

The case cite is Nike, Inc. v. Nikepal Int’l, Inc., 05-1468 (E.D. Calif.).