25 October 2016Trademarks

Starbucks triumphs in ‘Dabuccino’ trademark battle

Multinational coffee company Starbucks has been granted a default judgment against a US-based company called Hitman Glass in a trademark infringement case.

Starbucks also won the judgment against an individual called James Landgraf for infringing its trademarks in the ‘Dabuccino’ line of products, which used “virtually identical logos” to Starbucks’ on glass bongs, t-shirts and pins.

The products were sold for up to $8,000.

The coffee company originally filed its suit against Landgraf and Hitman Glass in June this year, but neither party answered the complaint.

Starbucks owns trademarks for terms such as ‘Starbucks’, ‘Starbucks Coffee’ and ‘Frappuccino’.

The business also owns marks for its Siren logo, 40th anniversary Siren logo, and the green, black and white colour scheme, as well as copyright protecting the logos.

Starbucks filed a motion for a default judgment and permanent injunctions against Landgraf for using its marks and copyright.

It asked for compensatory damages, permanent injunctive relief, actual damages and attorneys’ fees.

In his judgment, published on October 20, District Judge Otis Wright II said that “Starbucks has sufficiently pled meritorious claims for trademark infringement and false designation of origin”.

Wright II said the “damages requested by Starbucks are reasonable”.

“To begin, statutory damages ‘are appropriate in default judgment cases because the information needed to prove actual damages is within the infringers’ control and is not disclosed,’” he said.

He added that “the court grants Starbucks’ motion for default judgment against Landgraf”, and while he denied Starbucks’ request for permanent injunctions “under both the Lanham and Copyright Acts”, he granted Starbucks’ request for $410,580 in damages and attorneys’ fees.

The default judgment was granted as the infringing ‘Dabbucino’ products “were specifically marketed using the statement, ‘[t]aking inspiration from one of America’s favourite frozen coffee drinks, this cup is hugely popular with most people and easily relatable’”.

A spokesperson for Starbucks told WIPR: "We are pleased with the court’s decision. Starbucks has made significant investments to develop our brand and IP over the past 45 years. We have an obligation to protect our IP from infringement in order to retain our exclusive rights to it."

Jack Wheat, member at law firm McBrayer, McGinnis, Leslie & Kirkland, said: "The exhibits reproduced in the court’s decision pretty clearly reflect that the products are knock-offs of well-known Starbucks’ insignia. Injunctions are pretty typical in these types of cases. I am surprised the court did not issue an injunction. Starbucks has two options relating to review of the denial of an injunction. They can file a formal request for the court to 'reconsider' the ruling. Courts rarely will reconsider and change a ruling though, unless convinced a clear mistake was made."

"Starbucks could also appeal the decision to the US Court of Appeals for the Ninth Circuit, an appellate court that has pretty extensive experience with IP cases. But in my opinion, Starbucks’ odds of success on appeal are not too good; trial courts have pretty broad discretion relating to whether to issue an injunction," he added.

He continued: "I expect the defendants’ products were intended to be a humorous parody of some well-known marks. Even so, owners of well-known marks rightly feel obligated to prevent unapproved simulation of their marks or risk their marks becoming weakened by widespread unapproved uses.

"The broken record message is: big guys can afford to be vigilant, the parodists and simulators typically cannot afford to defend themselves, or even if they can afford to, they are often counselled it will not be worth the fight. The fact there was a default judgment here is not too surprising."

Jack Wheat is a WIPR Leader for 2016. His profile is available  here.

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