u.s. polo association v. prl usa holdings, 12-1346-cv (2d cir.) (appellee l'oreal's 10-16-12...

7/31/2019 U.S. Polo Association v. PRL USA Holdings, 12-1346-CV (2d Cir.) (Appellee L'Oreal's 10-16-12 brief).pdf

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12-1346-cvUnited States Court of Appeals

for the

Second Circuit

UNITED STATES POLO ASSOCIATION, INC.,

USPA PROPERTIES, INC.,

Plaintiffs-Counter-Defendants-Appellants,

against

PRL USA HOLDINGS, INC.,

Defendant-Counter-Claimant-Appellee,

LOREAL USA, INC.,

Intervenor-Defendant-Counter-Claimant-Appellee.

_______________________________

ON APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF NEW YORK

BRIEF FOR INTERVENOR-DEFENDANT-COUNTER-

CLAIMANT-APPELLEE

ROBERT L.SHERMAN,ESQ.

PAUL HASTINGS LLP

Attorneys for Intervenor-Defendant-Counter-Claimant-Appellee

75 East 55th StreetNew York, New York 10022

(212) 318-6000

Case: 12-1346 Document: 76 Page: 1 10/16/2012 747706 69


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CORPORATE DISCLOSURE STATEMENT

Counsel for Intervenor-Defendant-Counter-Claimant-Appellee LOreal

USA, Inc. hereby certifies (1) that LOreal is the ultimate corporate parent of

LOreal USA, Inc.; and (2) that LOreal is a publicly held company traded on the

Paris Stock Exchange that owns 10% or more of LOreal USA, Inc.s stock.

Dated: New York, New York

October 16, 2012

PAUL HASTINGS LLP

By: /s/ Robert L. Sherman

Robert L. Sherman (RS 5520)

75 East 55th Street

New York, NY 10022

Telephone: (212) 318-6000

Facsimile: (212) 318-6847

[email protected]

Attorney for LOreal USA, Inc.



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TABLE OF CONTENTS

Page

-i-

INTRODUCTION .................................................................................................... 1

STATEMENT OF THE CASE ................................................................................. 8

STATEMENT OF FACTS ..................................................................................... 11

A. USPAs Foray Into Fragrances ................................................ 11

B. The Prior Disputes ................................................................... 12

1. The 1984 Opinion and Order ......................................... 12

2. The 2006 Apparel Litigation and Settlement

Agreement ...................................................................... 16

3. The Trademark Trial and Appeal Board Order ............. 18

SUMMARY OF ARGUMENT .............................................................................. 19

ARGUMENT .......................................................................................................... 24

I. THE DISTRICT COURTS POLAROID ANALYSIS AND

FINDING OF INFRINGEMENT WERE NOT CLEARLY

ERRONEOUS .............................................................................................. 24

A. The District Court Properly Rejected USPAs Argument That

The Parties Prior History Gives USPA Affirmative Rights to

Use An Infringing Mark In Connection With Fragrances ................. 26

B. The District Court Properly Rejected USPAs Argument That

Its Purported Rights To And Prior Use of Other Marks In

Connection With Other Goods Should Affect Or Excuse The

Determination of Infringement ........................................................... 31

C. The District Courts Conclusion That USPA Adopted The

USPA Mark In Bad Faith Was Amply Supported By The

Evidence of Record ............................................................................ 35

D. The District Courts Analysis of the Polaroid Factor RegardingSimilarity of the Marks Was Properly Conducted ............................. 39

E. The District Court Properly Concluded That Apparel and

Fragrances Constitute Separate Markets and That The

Purported Relatedness Between Them Was Irrelevant .................. 43



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TABLE OF CONTENTS(continued)

Page

-ii-

F. The District Court Properly Assessed and Evaluated The

Evidence Regarding Confusion And The Weight To Be GivenEach Partys Survey ........................................................................... 47

G. The District Court Properly Weighed the Polaroid Factors to

Find Infringement But, In All Events, There Is No Balancing of

the Factors That Would Have Led To A Different Result ................. 53

II. THE DISTRICT COURT PROPERLY GRANTED INJUNCTIVE

RELIEF BASED ON TESTIMONY THAT USPAS USE OF ITS

INFRINGING MARK WOULD CAUSE PRL IRREPARABLE

HARM .......................................................................................................... 54

III. THE DISTRICT COURT PROPERLY EXERCISED ITS

DISCRETION IN FASHIONING AN INJUNCTION TAILORED

TO ADDRESS THE THREATENED HARM POSED BY A

REPEAT INFRINGER ................................................................................. 60

CONCLUSION ....................................................................................................... 62



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iii

TABLE OF AUTHORITIES

Page(s)

CASES

eBay, Inc. v. MercExchange, L.L.C.,

547 U.S. 388 (2006) .....................................................................................passim

Grotrian, Helfferich, Schulz, Th. Steinweg Nachf. V. Steinway & Sons,

523 F.2d 1331 (2d Cir. 1975).......................................................................................... 40

International Star Class Yacht Racing Assn v. Tommy Hilfiger U.S.A. Inc.,

94 Civ. 2663 (RPP), 1995 WL 241875 (S.D.N.Y. Apr. 26, 1995), affd in

part, vacated in part, and remanded, 80 F.3d 749 (2d Cir. 1996) ........................32

Jaguar Cars Ltd. v. Skandrani,

771 F. Supp. 1178 (S.D. Fla. 1991)............................................................................... 44

Louis Vuitton Malletier v. Burlington Coat Factory Warehouse,

426 F.3d 532 (2d Cir. 2005) ..................................................................................... 40, 41

Paco Sport, Ltd. v. Paco Rabanne Perfumes,

234 F.3d 1262 (2d Cir. 2000).......................................................................................... 41

Patsys Brand Inc. v. I.O.B. Realty, Inc.,317 F.3d 209 (2d Cir. 2003) ............................................................................................ 60

Peoples United Bank v. PeoplesBank,

401 F. Appx 607 (2d Cir. 2010).................................................................................... 25

Polaroid Corp. v. Polaroid Elecs. Corp.,

287 F.2d 492 (2d Cir. 1961), cert. denied, 368 U.S. 820 (1961) ...................passim

PRL Holdings, Inc. v. United States Polo Assn, Inc.,

520 F.3d ................................................................................................................................ 61

PRL USA Holdings, Inc. v. U.S. Polo Assn, Inc.,

No. 99 CV 10199(GBD), 2006 WL 1881744 (S.D.N.Y. July 7, 2006),

affd, PRL USA Holdings, Inc. v. U.S. Polo Assn, Inc.,520 F.3d 109 (2d

Cir. 2008) .............................................................................................................. 4



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iv

Salinger v. Colting,

607 F.3d 68 (2d Cir. 2010) ........................................................................... 22, 55

Scarves By Vera, Inc. v. Todo Imports Ltd.,

544 F.2d 1167 (2d Cir. 1976).......................................................................................... 44

The All England Lawn Tennis Club (Wimbledon) Ltd. v. Creations

Aromatiques, Inc.,

220 U.S.P.Q. 1069 (T.T.A.B. 1983)................................................................ 26, 33, 34

Times Mirror Magazine, Inc. v. Field & StreamLicenses Co.,

294 F.3d 383 (2d Cir. 2002) ............................................................................................ 45

U.S. Polo Assn, Inc. v. Polo Fashion, Inc.,

No. 84-civ-1142(LBS), 1984 WL 1309 (S.D.N.Y. Dec. 6, 1984) (the

1984 Order) .............................................................................................................passim

U.S. Polo Assn, Inc. v. PRL USA Holdings, Inc.,

800 F. Supp. 2d 515 (S.D.N.Y. 2011)........................................................................... 10

U.S. Polo Assn, Inc. v. PRL USA Holdings, Inc.,

No. 09 Civ. 9476, 2012 WL 697137 (S.D.N.Y. Mar. 5, 2012) ................................ 4

Union Carbide Corp. v. Ever-Ready, Inc.,

531 F.2d 366 (7th Cir. 1976), cert. denied,429 U.S. 830 (1976) ..........................49

OTHER AUTHORITIES

Rule 36(b), Fed. R. Civ. P. ....................................................................................... 29

J. Thomas McCarthy,McCarthy on Trademarks and Unfair Competition

24:1, at 24-7-8 (4th ed. 2012) ......................................................................................... 44

J. Thomas McCarthy,McCarthy on Trademarks and Unfair Competition

30:4, at 30-16-30-18 (4th ed. 2012)................................................................................60



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INTRODUCTION

The United States Polo Association, Inc. (USPA) and USPA Properties,

Inc. (collectively, the USPA Parties) are repeat willful infringers of the famous

Polo Player Logo and POLO word mark owned by PRL USA Holdings, Inc.

(PRL). They commenced a declaratory judgment action against PRL, seeking

a determination that their intended use of the Double Horseman logo in

combination with the wording U.S. POLO ASSN. on certain blue packagingfor

mens fragrances would not infringe PRLs trademark rights. LOral USA, Inc.

(LOral and, together with PRL, the PRL Parties), PRLs exclusive licensee

for fragrances, intervened and with PRL counterclaimed for infringement.

At trial, the PRL Parties demonstrated that USPA had adopted the Double

Horseman logo in combination with U.S. POLO ASSN. (the USPA Mark) in bad

faith and that use of that mark on fragrances would create a likelihood of confusion

with PRLs famous Polo Player Logo and POLO word mark (the PRL Marks).

The PRL Parties further demonstrated that they would suffer irreparable harm if

USPA were permitted to make use of its infringing mark in connection with

fragrances. In light of the USPA Parties prior infringement of the same PRL

Marks, their violation of a prior injunction with respect to those same marks and

their intractable insistence that they occupy a unique position that excuses or

negates their repeated infringement of the PRL Marks, the PRL Parties sought an



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injunction that would set clear limits on the parties respective rights and finally

clarify and reaffirm the prohibitions contained in the injunction that had been in

force against USPA for more than 25 years. The PRL Parties also sought an award

of attorneys fees based on the district courts finding of bad faith infringement and

on the USPA Parties bad faith litigation tactics. The district court acknowledged

that attorneys fees properly could be granted under the facts of this case but,

exercising its discretion,declined to award such fees and instead issued an

injunction appropriate in scope for a repeat willful infringer.

USPA appeals from the finding of infringement and the issuance and scope

of the injunction based on arguments that, if accepted, would excuse USPAs

deliberate copying and infringement of the PRL Marks for all goods merely

because USPA is the self-described governing body of the sport of polo.

Throughout the proceedings, the USPA Parties consistently mischaracterized the

issues -- including the very marks in dispute and the prior history between PRL

and USPA -- and persisted in asserting the misguided argument that USPA has,

through prior infringing uses, somehow acquired special additional rights that

allow it now to infringe the PRL Marks in connection with fragrances, a product

category in which the PRL Marks have achieved enormous strength and with

which the USPA Mark heretofore was never used. Among the USPA Parties



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many intentional, blatant and deceptive mischaracterizations trumpeted throughout

the trial and now in this appeal are:

The astonishing assertion that the order in U.S. Polo Assn, Inc. v. Polo

Fashion, Inc., No. 84-civ-1142(LBS), 1984 WL 1309 (S.D.N.Y. Dec. 6,

1984) (the 1984 Order)1ratified and affirmed USPAs right to

conduct a licensing program and conferred on USPA greaterrights to use

a mark confusingly similar to the PRL Marks despite the fact that the

1984 decision found the USPAs mounted polo player logo there at issue

to infringe PRLs Polo Player Logo, prohibited USPA from using POLO

as a trademark, prohibited USPA from using a mounted polo player logo

unless distinctive from PRLs Polo Player Logo in content and

perspective and prohibited USPA from using the name United States

Polo Association, or any other name which emphasizes the word POLO

(or the words U.S. POLO) separate, apart and distinct from such name in

a manner that is likely to cause confusion with [PRL]. Nonetheless,

USPAs appeal brief continues to refer to its Court-Approved Retail

Licensing Program and to suggest that it has special rights by virtue of

the 1984 Order that enjoinedits use of the marks there at issue, despite

1A-1588-93.



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4

the district courts clarification in this case (in its opinion addressing

attorneys fees) that:

the 1984 Order did not, as the USPA Parties

contend, grant [USPA] any right whatsoever to

conduct a licensing program, nor did this Court in

the May 2011 opinion. Instead, both courts

recognized the fact that the USPA Parties may,

having no judicially granted right to do so, enter

the marketplace just as any other may so long as

they do not infringe the PRL Parties marks or

otherwise violate the terms of injunctions. Thus,

to the contrary, both opinions found that while the

USPA Parties may enter the market as any other,their legal ability to do so with respect to their

marks will be necessarily more limited than others

who have not previously been found to infringe.

U.S. Polo Assn, Inc. v. PRL USA Holdings, Inc., No. 09 Civ. 9476,

2012 WL 697137 (S.D.N.Y. Mar. 5, 2012).

Attempting to position the dispute regarding fragrances as already havingbeen adjudicated in the litigation concerning apparel

2(the Apparel

Litigation), despite the fact that the Apparel Litigation involved different

marks, different goods and different facts.

Referring to the marks at issue in this appeal as the very sametrademarks and the identical trademarks as those involved in the

2 PRL USA Holdings, Inc. v. U.S. Polo Assn, Inc., No. 99 CV 10199(GBD),

2006 WL 1881744 (S.D.N.Y. July 7, 2006), affd, PRL USA Holdings, Inc. v.

U.S. Polo Assn, Inc.,520 F.3d 109 (2d Cir. 2008).



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Apparel Litigation, when that case did not address the use of U.S. POLO

ASSN. or any use of the word POLO in combination with the Double

Horseman logo.

Describing this Court as having affirmed a finding of non-infringement inthe Apparel Litigation, when this Court determined only that the district

court had not committed reversible error with respect to two specific

evidentiary rulings and a jury instruction, as a result of which the jury

verdict was allowed to stand.

Misrepresenting a purported settled right to use its name, when thesettlement agreement regarding the use of UNITED STATES POLO

ASSOCIATION, U.S. POLO ASSN. and other variations did not allow

for use of such wording with mounted polo players and expressly applied

only to goods classified in International Class 25 (apparel) and select

goods in other classes, none of which included fragrances or any other

International Class 3 goods, and cannot be relied on as the basis for

a right to make trademark use of POLO, alone or in combination with

other words, in connection with fragrances.

Arguing that adoption of the Double Horseman logo in combination withU.S. POLO ASSN. on blue packagingfor fragrances was reasonable in

light of the Apparel Litigation due to the purported relatedness of the



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apparel and fragrance markets, despite USPAs awareness of the

Trademark Trial and Appeal Boards (TTAB) order expressly finding

that [i]nsofar as the district court order [in the Apparel Litigation] is

silent as to products falling under International Class 3, the likelihood of

confusion claim before us involves different transactional facts material

to the claim and that the Apparel Litigation does not have preclusive

effect with respect to use of the mark in connection with goods in Class

3.

Confusing its rights, which are no greater than those of any other, tomake descriptive, non-trademark use of the word polo and to use non-

infringing marks that relate to or depict the sport of polo, with a supposed

right to make trademark use of the word POLO (alone or in combination)

and of a specific depiction of the sport.

Pressing the unsubstantiated and novel position that, as a sportingassociation, USPA has a special sort of trademark right in gross to use its

name and Double Horseman logo in connection with any goods

regardless of the likelihood of confusion with the marks of a senior user

in a specific product category, subject to a unique infringement analysis

that, apparently, applies to USPA alone.



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Remarkably, USPA argued before the district court and now argues on

appeal that its infringement of the PRL Marks in connection with fragrances

should be judged more leniently than that of a first-time offender because of the

prior history between the parties -- a history, it bears repeating, in which USPA has

been found to infringe the PRL Marks it again has been found to infringe here.

USPA also argues that its infringement should not be enjoined, despite trial

testimony regarding the loss of control and significant damage to PRLs reputation

and brand image that would ensue from confusion in the fragrance marketplace.

Under USPAs reasoning, a declaratory judgment defendant never would have any

recourse or remedy. Instead, it would be in the untenable position of having to

allow the adjudged infringer to make widespread use of its mark and cause actual

damage to the senior users reputation, brand value and goodwill, no matter how

devastating, eligible to seek relief only after the harm, which by definition is

irreparable, already had occurred (but before such time had passed as to allow

a defense of acquiescence or laches). USPAs theory cannot be the law. In

addition, despite claiming to rely on the 1984 Order as a road map that sets the

boundaries for its retail licensing program, USPA objects that the injunction here

entered by the district court is impermissibly broad, notwithstanding that the

language objected to merely repeats and incorporates the very same restrictions

contained in the 1984 Order on which the USPA Parties so heavily rely.



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The district court carefully considered and properly rejected USPAs

arguments, which include those presented here on appeal, correctly applied

a traditional Polaroidanalysis and issued a comprehensive but appropriate

injunction. In doing so, it committed no clear error and no abuse of discretion.

STATEMENT OF THE CASE

The USPA Parties have attempted at every turn to cast this case as already

having been determined by (1) the 1984 litigation, which they inexplicably

interpret as having ratified the [USPAs] right to maintain a licensing program

using its name and a mounted polo player symbol that is distinctive from PRLs,

and (2) the Apparel Litigation, going so far as to file the action below as a related

case despite the fact that there was no other action pending a request that Judge

Daniels rejected out of hand. The marks, goods and marketplace factors involved

in this appeal differ from those previously litigated. The only relevance of the

prior cases is the fact that, in both, USPA was found to have adopted a mounted

polo player mark that infringed PRLs Polo Player Logo and, in the 1984 case, an

injunction issued prohibiting USPA from adopting marks that are confusingly

similar to the PRL Polo Player Logo or POLO word mark in connection with any

goods or services. As a prior infringer, USPA had and continues to have an

obligation to exercise greatercaution against adopting yet another infringing mark,



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not, as it argues, a right to have its infringement excused based on the parties prior

history.

Nonetheless, despite its status as a prior infringer, despite the long-standing

injunction against the adoption and use of a mounted polo player logo, the word

POLO and trade dress that is confusingly similar to the marks and trade dress used

by PRL, and despite the TTABs rejection of USPAs argument that apparel and

fragrances are sufficiently related that the resolution of the Apparel Litigation also

resolves USPAs rights in the USPA Mark for goods in Class 3, the USPA Parties

authorized their licensee to create packaging for a mens fragrance using the

Double Horseman logo in combination with U.S. POLO ASSN. on navy blue

background with pale metallic lettering that unmistakably mimicked the trade dress

of PRLs best-selling mens fragrance, POLO BLUE.

LOral, not a named defendant in the USPA Parties declaratory judgment

action, moved to intervene and engaged an expert to conduct a consumer survey

regarding the likelihood of confusion between the parties marks. That survey was

conducted in January 2010, immediately following the holiday shopping season.

The order granting LOrals motion to intervene was entered on February 11,

2010. A-176-78. The survey and report were finalized and signed on February 25,

2010. On March 2, 2010, LOral filed its answer, counterclaims and motion for



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a preliminary injunction. That motion was consolidated with the trial on the

merits, which was heard in September 2010 by agreement of the parties.3

On May 13, 2011, the Honorable Robert W. Sweet, United States District

Judge for the Southern District of New York, issued an opinion in which he held

that the USPA Parties had adopted the USPA Mark for fragrances in bad faith, that

the USPA Mark used in connection with fragrances infringed the PRL Marks and

that the USPA Parties had violated the 1984 Order. He then granted the PRL

Parties request for a permanent injunction. U.S. Polo Assn, Inc. v. PRL USA

Holdings, Inc., 800 F. Supp. 2d 515 (S.D.N.Y. 2011); A-2269-329. On

November 14, 2011, the PRL Parties moved for attorneys fees. On March 5,

2012, the district court issued an order acknowledging USPAs bad faith and repeat

infringement but, in the exercise of the courts discretion, denying the request for

attorneys fees, and a separate order entering a permanent injunction that prohibits

the USPA Parties from using the Double Horseman logo or the word POLO alone

or in combination with other words in connection with fragrances, and

incorporating other prohibitions contained in the injunction that has been in force

against USPA since 1984.

3The USPA Parties agreed in a letter to the court that was so ordered not to

use the offending mark and trade dress unless and until a decision by the

district court would permit them to do so. A-7-8, D.E. 24.



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USPA filed this appeal, challenging the district courts finding of

infringement, entry of an injunction and the scope of that injunction.

STATEMENT OF FACTS4

A. USPAs Foray Into FragrancesIn 2008, USPA discussed with JRA Trademark Company Ltd. (JRA), its

master licensee in the United States, expanding into the fragrance market.5

By fall

of 2009, JRA designed packaging for use on a mens fragrance that featured the

Double Horseman logo that was being used by USPA on apparel, but this time in

combination with the wording U.S. POLO ASSN., on blue background with a thin

line creating a border around the perimeter of the front panel all appearing in light

gold.6

4For a summary of the facts concerning the evolution and acknowledged fame

of PRLs Polo Player Logo, shown immediately below, the Court is

respectfully referred to the district courts opinion at A-2273-75; A-2290-91.

5A-992:24-A-993:8.

6A-37; A-994:22-24.



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On November 13, 2009, the USPA Parties filed a declaratory judgment

action against only PRL seeking a determination that USPAs use of the Double

Horseman logo and U.S. POLO ASSN word mark in connection with fragrances

does not infringe PRLs rights.7

A fair reading of the complaint makes it clear that,

at that time, the USPA Parties had not yet launched their fragrance product.8

The

USPA Parties were about to go to market despite having no business plan, budget,

advertising or experience in the product category. A-2315.

Because USPA persists in presenting a tortured interpretation of its litigation

history with PRL, in an attempt to enlarge its trademark rights and excuse its

infringement, it is necessary to provide the factual background of those previous

disputes.

B. The Prior Disputes1. The 1984 Opinion and OrderIn 1984, USPA and its licensees commenced an action against PRLs

predecessor (also referred to herein as PRL) for a declaratory judgment that

various articles of merchandise bearing a mounted polo player symbol did not

infringe PRLs Polo Player Logo. PRL counterclaimed for trademark

infringement. The matter came before Judge Sand, who found that USPA and its

7A-18-138.

8A-28, 36; A-30, 44, 47; A-31, 51; A-32, 55.



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licensees infringed PRLs Polo Player Logo, POLO and POLO BY RALPH

LAUREN trademarks and trade dress, and engaged in unfair competition.9

The

1984 Order enjoined USPA and its licensees from infringing the Polo Player Logo

and the word POLO, but clarified that USPA was not enjoined generally from

engaging in a licensing program using non-infringing trademarks.10

Throughout this case, USPA inexplicably has relied on the 1984 Order as

having granted USPA affirmative and judicially-recognized rights to conduct

a retail licensing program using its name and a mounted polo player logo. In its

appeal brief, USPA repeatedly makes such claims, e.g., the 1984 Order, which

affirmed [USPAs] right to use its name and a distinctive mounted polo player

symbol in connection with a retail licensing program,11

[i]n recognizing

[USPAs] right to conduct a retail licensing program using marks related to the

sport of polo, the 1984 Order acknowledged the rights of a sporting association to

use marks related to its sport,12

and the 1984 Order held that [USPA] is entitled

to use its name in a manner that does not confusingly emphasize the word Polo or

9 U.S. Polo Assn v. Polo Fashions, Inc., No. 84 civ. 1142 (LBS), 1984 WL 1309

(S.D.N.Y. Dec. 6, 1984).10

A-1588-93, 8, 9.11

Appellants Br. 25.12

Id., 26.



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U.S. Polo.13

There is no fair reading of Judge Sands 1984 opinion and order

that can in any way support USPAs characterization of the order as having

granted, authorized or ratified any affirmative trademark rights in USPA. After

finding USPA liable for infringing PRLs Polo Player Logo, Judge Sand entered an

injunction that prohibitedUSPA from

(a) using any of the Polo Marks or any name or mark or

symbol which is confusingly similar thereto, in

connection with the sale or offering for sale of any

goods (d) using for any commercial purposes

whatsoever, the name United States Polo Association,or any other name which emphasizes the word POLO or

the words U.S. POLO separate, apart and distinct from

such name in a manner that is likely to cause confusion

with [PRL]; (e) infringing [PRLs] trademark, trade

names or trade dress; (h) using any reproduction,

counterfeit, copy or colorable imitation of the Polo

Marks, including but not limited to POLO used as

a trademark, in connection with the publicity, promotion,

sale or advertising of goods sold by them including,

without limitation, apparel, fashion accessories and any

other items or any related service; and (i) affixing,

applying, or using in connection with the sale of any

goods, a false description or representation, including

words or other symbols tending to falsely describe or

represent such goods as originating with [PRL], and from

offering such goods in commerce, including specifically,

but not limited to, all uses of the singular or composite

use of POLO and U.S. POLO in a manner which is likely

to cause confusion with [PRL].14

13 Id., 27.

14A-1588-93, 8.



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The 1984 Order clarifies that [n]othing contained herein shall be construed

to prohibit [USPA] from using the word polo, not as a trademark or indication

of origin, but solely to describe or refer to the sport of polo or to prevent USPA

from conducting a retail licensing program utilizing the USPA collective

membership mark (Reg. No. 1,181,651), the USPA horsehead symbol (Reg.

No. 1,304,236) or a mounted polo player or equestrian or equine symbol which is

distinctive from the [PRL] polo player symbol in its content and perspective,

provided that such symbol is used in conjunction with trade dress, i.e., labels,

hangtags and packaging, which does not utilize white or silver lettering on a blue

background or emphasize the word POLO by presenting it in a rectangle or

between parallel lines or in lettering larger than that of associated words or letters

used to identify USPA, and does not utilize any other trade dress which is likely to

cause confusion with [PRL].15

Although the 1984 Order recognizes that USPA

has the same rights as any other to make descriptive (i.e., non-trademark) use of

the word polo and to conduct a retail licensing program using trademarks and

trade dress that do not infringe PRLs trademarks or trade dress, it does not in any

way expand USPAs rights or endorse its use of any particular mark.

15 Id., 9.



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2. The 2006 Apparel Litigation and Settlement AgreementIn the Apparel Litigation, the jury considered four marks used in connection

with apparel and certain other goods, none of which includes fragrances. The jury

determined (a) that the solid double horseman alone infringed PRLs Polo Player

Logo, but (b) that the solid double horseman logo with the letters USPA

underneath, the outline double horseman alone (the mark now referred to as the

Double Horseman logo), and the outline double horseman with the letters USPA

underneath did not infringe PRLs Polo Player Logo in connection with the goods

there at issue.16

Unlike a courts determination of infringement, the jurys verdict does not

provide any information or insight regarding how the jurors analyzed each of the

Polaroidfactors, only that, on final balancing, certain marks were found not to

infringe. It may be that the jury determined that the marks were extremely similar

but that the similarity was outweighed by other Polaroidfactors and/or excused by

other facts there present. Regardless, despite USPAs repeated references in its

brief to the jurys determination regarding the very same or identical marks,

the jury in the Apparel Litigation neverconsidered the Double Horseman logo in

16A-2228-31.



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combination with U.S. POLO ASSN., or any mark that includes the term POLO.

The final order and judgment entered by Judge Daniels in that case made it crystal

clear that the jury verdict pertained only to the goods there at issue, namely,

apparel, watches, leather goods and certain goods in Class 28 that relate solely to

the sport of polo. Excluded from the Apparel Litigation by stipulation of the

parties were fragrances, in Class 3.17

The Apparel Litigation, therefore, addressed

different marks used on different goods, not the marks here at issue in connection

with fragrances. Similarly, although USPA references its settled right to use its

name and the parties agreement with respect to use of U.S. POLO ASSN., that

agreement by its terms is limited to specified goods; it does not address USPAs

right to use that mark in connection with fragrances and cannot now be relied on

by USPA as a basis for asserting such rights.

PRL appealed three specific issues from the Apparel Litigation -- two

evidentiary rulings and the district courts refusal to give a jury instruction stating

that, as a previous infringer, USPA must keep a safe distance from PRLs marks.

This Court affirmed the district courts rulings, holding that an instruction that

incorporated the safe distance rule might confuse a jury as to the proper standard

for liability. That does not, however, equate to holding, as USPA here asserts, that

17A-1096:9-A-1097:11; A-2228-31.



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USPA is different in any way from a traditional infringer that can be required to

keep a safe distance from the PRL Marks. Nor does it equate to an affirmation or

acknowledgment of USPAs right to use the Double Horseman logo on other

goods. It certainly cannot be understood as a judicial affirmation of the right to use

the USPA Mark at issue here, as that mark never was before the jury or this Court.

3. The Trademark Trial and Appeal Board OrderIn their declaratory judgment complaint, the USPA Parties alleged that

following judgment in the Apparel Litigation, they requested that the USPTO end

suspension of opposition proceedings involving U.S. POLO ASSN., 1890 and

Double Horseman Trademark for cosmetics and fragrances.18

What actually

happened was that USPA filed a motion for summary judgment seeking to dismiss

the opposition with prejudice based on the decision in the Apparel Litigation. In

November 2008, the TTAB denied USPAs motion for summary judgment and

held that the Apparel Litigation involved different transactional facts, namely, that

apparel was materially different from fragrances, such that the Apparel Litigation

was not material to the opposition proceeding (TTAB Order).19

The TTAB also

noted that the marks at issue in the Apparel Litigation differed from those in the

opposition proceeding, as the Apparel Litigation did not address the combination

18A-27, 34.

19A-2232-37; A-1097:25-1099:5.



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of the Double Horseman logo with the wording U.S. POLO ASSN.20

Utterly

ignoring that holding, USPA continues to insist that the Apparel Litigation and the

relatedness of apparel and fragrances essentially foreclose consideration of

whether its adoption and use of the USPA Mark infringe the PRL Marks.

SUMMARY OF ARGUMENT

USPAs arguments regarding its right to enter the fragrance market reflect

its fundamental and seemingly intractable misunderstanding of trademark law.

Trademark rights do not exist in gross. USPA has no generalized affirmative

rights to use its marks or marks related to the sport of polo where, as here,

those marks used in connection with specific goods infringe the rights of a senior

user. The concepts of natural expansion and related goods apply to extend the

protection available to a senior userwhose marks are infringed by use on related

goods; those concepts have no application when the goods at issue are identical

(here, fragrances versus fragrances) and may not be used by an infringer based on

its use of a mark in connection with other goods. Those found liable for

infringement in the past have an obligation to exercise greater care not to infringe

the same partys marks in the future; ones status as a sporting organization, retail

20A-2232-37.



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licensor, or even long-standing user of a mark in connection with other goods or

services, does nothing to lessen that obligation.

USPA knows that under a straightforward Polaroidanalysis, there is no

question that the USPA Mark infringes the PRL Marks. It therefore goes through

contortions to avoid or constrain the application of the Polaroidfactors,

mischaracterizing facts and findings, and essentially arguing that this Court should

create a special law of trademarks that applies only to USPA.

Specifically, USPA argues that the district courts finding of likelihood of

confusion, and in particular the finding of bad faith, cannot be supported by the

record in light of the lack of actual customer confusion, the history of the marks

coexistence, and the judicially recognized right of [USPA] to use their marks in the

marketplace as well as a federal jurys earlier determination that the very mark

that the court found had been adopted in bad faith did notcause a likelihood of

confusion or infringe on PRLs marks.21

USPA further argues that the district

court failed to consider the rights of [USPA] to use marks related to the sport

of polo, the strength of [USPAs] marks and brand, the previous agreements and

interactions between these parties, the marketplace coexistence between the

parties products, the relationship between the fragrance and apparel markets, and

21Appellants Br. 20.



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the evidence that consumers have not been confused by [USPAs] use of its

marks.22

The PRL Parties respectfully point out USPAs artful wording and

presentation of the issues and the need for this Court to treat with skepticism any

suggestion by USPA that the parties history essentially disposes of the question of

infringement.

There has been no judicial recognition of USPAs right to use the mark at

issue in this case, which is the only mark that matters, and no judicial

consideration of USPAs right to use any mark in connection with fragrances. In

fact, the only previous determination regarding USPAs right to use the USPA

Mark at issue in this case was the TTAB Order, which rejected USPAs argument

that the outcome of the Apparel Litigation gave it any rights to the USPA Mark in

connection with fragrances. Despite USPAs reference to a federal jurys earlier

determination regarding the very mark that the court found had been adopted in

bad faith, the fact is that the federal jury did notconsider the very mark that was

before the district court. Even leaving aside the differences between the goods at

issue in the Apparel Litigation and the current case, the federal jury never

considered the Double Horseman logo in conjunction with U.S. POLO ASSN. or

any use of the word POLO. The district court here explicitly stated that its finding

22 Id.



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of bad faith was based, in part, on USPAs initial adoption of the USPA Mark

along with trade dress that mimicked PRLs trade dress for its best-selling POLO

BLUE fragrance, which was not before the jury in the Apparel Litigation. The

previous agreements between the parties expressly relate only to the goods

identified therein and form no basis for USPA to assert trademark rights in any

mark with respect to fragrances.

USPAs arguments against the issuance of the injunction and against the

scope of injunction also are without merit. Even after eBay23and Salinger,24

trademark owners are not required to suffer actual harm before seeking injunctive

relief. If that were the case, a declaratory judgment defendant never would have

recourse against an infringer. The very nature of the irreparable harm attendant to

marketplace confusion ensures that the harm often will be difficult to measure or

prove. Although courts generally may no longer presume irreparable harm from

a finding of infringement, injunctive relief remains appropriate and available when

the factors that justified the old presumption pertain (namely, threat of loss of

control, reputational harm, damage to brand image and diminution in brand value).

That is not surprising. As Chief Justice Roberts stated in eBay, when determining

whether an injunction should issue, a page of history is worth a volume of logic.

23 eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006).

24 Salinger v. Colting, 607 F.3d 68 (2d Cir. 2010).



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547 U.S. at 395. The PRL Parties witnesses testified regarding the irreparable

harm they likely would suffer if USPA were permitted to use its infringing mark.

It was well within the district courts proper exercise of discretion to credit that

testimony and grant injunctive relief. Similarly, it was well within the proper

exercise of discretion for the district court to issue an injunction that prohibits use

of marks beyond the specific mark before it, and to reassert the prohibitions

contained in a prior injunction that USPA violated. It is not clear what USPAs

objection to those prohibitions can be, as it claims to have relied on the prior

injunction as the road map for its brand development for the past 25 years.

The district court considered USPAs arguments and properly rejected the

notion that the parties history, USPAs position as a sporting association that

conducts a retail licensing program, or the purported relatedness of fragrances and

apparel should constrain the traditional Polaroidanalysis or excuse USPAs

infringement. The district court committed no error in its determinations regarding

each Polaroidfactor, including similarity of the marks, bad faith and actual

confusion. Having found that each of the Polaroidfactors either favors the PRL

Parties or is neutral, any balancing of the factors would result in a finding of

infringement. There is no basis on which the district courts determination of

infringement can or should be reversed. In light of the finding of infringement, the

testimony regarding irreparable harm and USPAs status as a repeat infringer, the



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district court had ample justification for granting a broad injunction. Neither the

issuance of that injunction nor its scope reflects an abuse of discretion.

ARGUMENT

I. THE DISTRICT COURTSPOLAROID ANALYSIS AND FINDINGOF INFRINGEMENT WERE NOT CLEARLY ERRONEOUS

For 50 years, the legal standard in this circuit for determining whether

a party has engaged in trademark infringement has been application of the factors

contained in Polaroid Corp. v. Polaroid Elecs. Corp., 287 F.2d 492 (2d Cir. 1961),

cert. denied, 368 U.S. 820 (1961). While paying lip service to the Polaroid

factors, USPA advocates a novel, radical departure from that standard. USPA

essentially asks this Court to accept that USPA -- alone among trademark owners -

- has acquired rights in gross to use certain marks and variations thereof,

irrespective of the rights of a senior user with respect to specific goods and

irrespective of the confusion that would ensue. USPA argues that the district court

should have constrained its infringement analysis based on purported rights that

USPA has in other marks used on other goods; should have interpreted a 25-year-

old order that enjoinedUSPA from infringing the same PRL marks at issue here as

insteadpermitting USPA to adopt and use marks likely to cause confusion; should

have excused infringement in the fragrance market based on litigation outcomes

and a settlement agreement that related expressly and exclusively to other goods;



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and should have ignored as reasonable USPAs manifest bad faith intent to copy

and free ride on the PRL Marks and trade dress with respect to fragrances.

Despite USPAs persistent efforts to position its declaratory judgment

complaint, and this entire action, as a mere continuation of prior litigation between

PRL and USPA, the law remains clear. No trademark rights exist in gross. A

sporting association and/or a retail licensor has no greater right than any other to

make use of its marks (or similar marks) in connection with a new category of

goods, where use of those marks on such goods creates a likelihood of confusion

with the mark of a senior user. The question of infringement must be analyzed as

it relates to the marks at issue as used in connection with the goods at issue, not

based on different marks used in connection with different products at a different

time.

The district court considered and correctly rejected USPAs arguments

regarding the application of an alternative standard or approach, and properly

analyzed the likelihood of confusion under the traditional Polaroidfactors. USPA

has a high bar to reach in asking this Court to reverse the district courts ultimate

determination. This Court will set aside a district courts findings on each

Polaroidfactor only for clear error. The Court reviews the overall balancing or

weighing of the factors de novo. Peoples United Bank v. PeoplesBank, 401 F.

Appx 607, 608 (2d Cir. 2010) (In the context of a trademark infringement suit,



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we review the district courts findings on each of the Polaroid factors under

a deferential standard and will set them aside only for clear error, and we review

the overall balance of the Polaroid factors as a legal issue de novo). Here, the

district court found that not one of the Polaroidfactors favored USPA. Absent

a finding that the district court committed clear error in its resolution of a factor

that itself outweighs all of the other factors combined, there is no de novo

balancing that could lead to a finding of non-infringement.

A.The District Court Properly Rejected USPAs Argument ThatThe Parties Prior History Gives USPA Affirmative Rights to Use

An Infringing Mark In Connection With Fragrances

USPA argues that the district court clearly erred in its Polaroidanalysis by

purportedly disregarding the market conditions in which the parties marks are

used. Those market conditions, according to USPA, refer to claimed

protectable rights in its own marks related to the sport of polo. The district court

did not disregard USPAs arguments. It considered them and found them

irrelevant, meritless or unavailing. That USPA does not like the outcome does not

mean that the analysis was clearly erroneous.

The specific market conditions that USPA claims should have formed the

parameters within which the district court conducted its Polaroidanalysis are

summarized and addressed in turn:



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(1) USPA argues that the district courts conclusion that [USPA] hadadopted its Double Horseman mark in bad faith had no basis in the record

because a jury presented with the Double Horseman mark had already concluded

that it did not infringe on PRLs mark, a decision that was affirmed by this Court.

Appellants Br. 23-24. However, as USPA itself emphasizes elsewhere in its brief,

here [t]he district courts conclusion was that the use of POLO in conjunction

with the Double Horseman mark in the [fragrance] context [] infringes the PRL

Parties substantive trademark rights. Id. at 53 (emphasis added by USPA).

USPAs argument against the scope of the injunction explicitly relies on the fact

that the district courts finding of likely confusion related to the use of the Double

Horseman markin combination with the word mark POLO. Id. at 54. The

USPA Mark considered by the district court in this case never was before the jury

in the Apparel Litigation. Far from disregarding the 2006 jury finding, Judge

Sweet considered and addressed it directly. His opinion states:

Nor are the PRL Parties claims foreclosed by

a jurys finding in 2006 . Most saliently, the marks at

issue here are employed in the context of fragrances, not

apparel. This case involves the use of the Double

Horseman mark with the word mark U.S. POLO ASSN.

1890, not alone or with USPA beneath. In contrast tothe 2006 apparel case, the dominant term in the word

portion of USPAs mark here and that which

consumers are most likely to view as having trademark

significance is POLO.

A-2288.



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Judge Sweet also pointed out that the TTAB had noted the differences

between the marks in the Apparel Litigation and the USPA Mark at issue with

respect to fragrances, namely, that the latter includes the wording U.S. POLO

ASSN. and that the import of the word POLO may differ in the context of

different goods, i.e., that it may be more arbitrary with respect to fragrances than

with respect to apparel. A-2289, n. 8, 9. The district court opinion makes clear

that the determination of bad faith also considered USPAs adoption of the blue

packaging presented in its declaratory judgment complaint, packaging that never

was before the jury in the Apparel Litigation. A-2313. The jurys finding with

respect to a different mark used on different goods in no way enlarges USPAs

rights or constrains the analysis of whether the mark here at issue infringes the

PRL Marks in connection with fragrances.

(2) USPA nonetheless presses the point, and attempts to argue that thesettlement agreement with PRL regarding the use of U.S. POLO ASSN. in

connection with other goods confers a right on USPA to use that mark in

connection with fragrances. Specifically, USPAs brief states that [t]he jury [in

the Apparel Litigation] did not consider [USPAs] right to use its U.S. POLO

ASSN. mark because that use was permitted by prior stipulation of the parties,

and that PRL withdrew its legal challenge to the use of U.S. POLO ASSN. on

apparel, leather goods, and watches and this Court affirmed the use of the Double



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Horseman mark on apparel, leather goods and watches.25

Appellants Br. 24 n2

and 25. Leaving aside the misleading statement that this Court affirmed the use

of the Double Horseman mark, when this Court only considered and affirmed

three specific rulings of the district court, there is no support whatsoever for the

proposition that a settlement or adjudication with respect to one category of goods

confers rights on a junior user with respect to any other category of goods. It is

disingenuous for USPA to attempt to enlarge its rights based on a settlement

agreement that, by its terms, was limited solely to the goods addressed therein,

which did not include fragrances. In addition, as Judge Sweet noted, the 1984

Order that USPA also attempts to use as a basis for its preexisting rights anticipates

reapplication ofPolaroidbecause the analysis of which symbols are distinctive

from PRLs Polo Player logo -- that is, not infringing -- and whether use of the

United States Polo Association name or other name is used in a manner that is

likely to cause confusion requires application ofPolaroid. In finding a likelihood

of confusion, the district court notes that the USPA parties have violated the 1984

Order insofar as it prohibited USPAs adoption of infringing marks. A-2287-88.

Far from a settled right to use its name, the use of U.S. POLO ASSOCIATION,

25The only evidence of that contention appears in response to a Request for

Admission filed in the Apparel Litigation, which is expressly inadmissible in

this action. See Rule 36(b), Fed. R. Civ. Pro. The PRL Parties hereby renew

their objection, A-972:10-973:5; A-1692-93, and move to exclude such

evidence.



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U.S. POLO ASSN. and other variations is not settled when USPA expands such

use into markets where it is likely to cause confusion with the existing rights of

a senior user.

(3) USPA also makes vague allusions regarding its judicially recognizedright to use marks as the governing body of the sport of polo and the protectable

rights in its own marks related to the sport of polo, marks that have achieved

recognition and secondary meaning among consumers through the [USPAs]

extensive retail licensing program. Appellants Br. 24. The PRL Parties

repeatedly have stated that they do not contest the USPA Parties right to use the

word polo to describe or refer to the sport of polo, i.e., in a descriptive rather

than trademark sense, or to conduct a product licensing program using marks that

do not infringe PRLs trademark and trade dress. The claim that USPA has the

right to use marks related to the sport of polo does not confer any affirmative

right to use specific marks that infringe a senior users trademark rights in

a specific product category. Just like any other, USPA has trademark rights only

by virtue of using a particular mark in connection with specific goods or services.

Its position as a sporting association or retail licensor does not change that

fundamental fact of trademark law and does not give it the right to adopt infringing

marks merely because they refer to or depict the sport of polo.



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The district court considered all of those arguments, presented by USPA in

an effort to avoid a traditional Polaroidanalysis, and found them unpersuasive.

That determination was proper, reasonable, based on the record and consistent with

long-standing trademark principles and precedent.

B.The District Court Properly Rejected USPAs Argument That ItsPurported Rights To And Prior Use of Other Marks In

Connection With Other Goods Should Affect Or Excuse The

Determination of Infringement

In presenting arguments regarding USPAs rights to and prior use of the

marks at issue, USPA again (1) inexplicably suggests that the mark at issue in

this case is the same as the marks before the court in 1984 and 2006 and

(2) mistakenly appears to believe that there exists a concept of trademark rights in

gross, rather than rights appurtenant to particular goods. Those arguments have

been addressed above. USPA refers to [t]he parties competing rights to use

marks relating to the sport of polo. However, the parties have no such

generalized rights. Neither party has a monopoly on or is precluded from using

unspecified marks relating to the sport of polo. PRL never has attempted to

prevent USPA from making use of marks, that relat[e] to the sport of polo but do

not create a likelihood of confusion with the PRL Marks.

The USPA Parties present a novel but bizarre argument, suggesting that

sports associations with licensing programs deserve different -- and preferential --

treatment under the trademark laws. The cases cited by USPA regarding sporting



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associations and their licensing programs are irrelevant and inapt. The PRL Parties

do not dispute that sporting associations, may license their marks on a variety of

goods, provided that those marks do not infringe the rights of a senior user. That

the facts set forth in the cited cases indicate that the National Football League and

the National Basketball Association license their trademarks for use on a variety of

products is of no legal significance, and certainly does nothing to establish that

USPAs role as a sporting association confers on it any special trademark rights.

Appellants Br. 26-27. The only conceivable reason for USPAs reference to those

cases is to distract from the admission made at trial, namely, that USPA Properties

president is not aware of a single sporting association that has licensed its mark for

use with fragrances and that there is no natural association whatsoever between the

word or pictorial representation of polo and perfumery, other than the

association created by the PRL Parties use of their iconic Polo Player Logo and

POLO word marks. A-1038:3-A-1039:22.

The cases cited by USPA do not support its position. Reliance on

International Star Class Yacht Racing Assn v. Tommy Hilfiger U.S.A. Inc., 94 Civ.

2663 (RPP), 1995 WL 241875 (S.D.N.Y. Apr. 26, 1995), affd in part, vacated in

part, and remanded, 80 F.3d 749 (2d Cir. 1996) is misplaced. There, the sports

association was the senior user of the goods in issue and was alleging

infringement. Here, the USPA Parties are the junior users engaging in



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infringement. The court there did not find an inherent right in an association to

conduct a licensing program. The All England Lawn Tennis Club (Wimbledon)

Ltd. v. Creations Aromatiques, Inc., 220 U.S.P.Q. 1069 (T.T.A.B. 1983) involves

neither a sports association nor infringement. There, the applicant attempting to

register WIMBLEDON as a trademark was refused registration for creating a

conflict with the famous tennis event, represented by the opposer, a British

corporation.

Contrary to USPAs assertion, the 1984 Order created no special or

affirmative rights and acknowledged only that USPA has the right, as does any

other, to make descriptive, nottrademark, use of the word polo, and to conduct

a retail licensing program using non-infringing marks. Ironically, the source

USPA relies on for its purported affirmative right to use its name is a provision

of the 1984 Order that enjoins USPA from using for any commercial purposes

whatsoever, the name United States Polo Association, or any other name which

emphasizes the word POLO (or the words U.S. POLO) separate, apart and distinct

from such name in a manner that is likely to cause confusion with defendants,

Ralph Lauren or any entity affiliated with them. A-1588-93, 8. The source that

USPA relies on for its purported acknowledged right to use marks relating to the

sport of polo is a paragraph from the 1984 Order that merely clarifies that the

injunction does not prohibit USPA from using the word polo, not as a



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trademark or indication of origin, but solely to describe or refer to the sport of

polo and, possibly, a paragraph clarifying that the injunction does not prohibit

USPA from conducting a retail licensing program using a mounted polo player that

is distinctive from the Polo Player Logo and that is not used in conjunction with

trade dress that emphasizes the word POLO and that does not use any other

trade dress which is likely to cause confusion with PRL. Id. at 9. It strains

credulity that USPA asked the district court, and now this Court, to read the 1984

Order as granting USPA any special rights or according it broader protection due

to its status as either a sports association or a retail licensor.

Moreover, the fact that USPA may have incontestable trademarks (for other

categories of goods) in its name and that [c]onsumers have seen the U.S. Polo

Assn. name on products in the U.S. ranging from apparel to leather goods to

watches to home textiles due to a settlement agreement that expressly applied

only to such goods does nothing to alter the parties rights, to diminish PRLs right

to protect its marks or to change the nature of the Polaroidanalysis.

Equally mistaken is USPAs argument regarding the safe distance rule and

this Courts determination that it was not reversible error for the district court in

the Apparel Litigation to have declined to give a jury instruction that incorporated

that rule. This Courts determination was rooted in a desire to avoid confusing the

jury as to the proper standard for a finding of likelihood of confusion. It did not



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reflect, expressly or implicitly, the acknowledgement of affirmative rights granted

to [USPA] as set forth in the 1984 Order, because there were no such rights

granted to USPA in that prohibitory order. It also did not reflect a determination

by this Court that USPA is anything other than a traditional infringer or that the

Apparel Litigation was anything other than a traditional infringement case. This

Courts affirmation of the district courts decision to reject a jury instruction

regarding the safe distance rule in no way undercuts the general rule or its

applicability to USPA. In all events, the district court didtake into account

USPAs right to use a non-infringing mounted polo player logo, but nonetheless

found the USPA Mark to be infringing.

C.The District Courts Conclusion That USPA Adopted The USPAMark In Bad Faith Was Amply Supported By The Evidence of

Record

As noted, in 2009, the USPA Parties decided to enter the mens fragrance

market with the Double Horseman logo in combination with U.S. POLO ASSN. on

blue packaging with light gold metallic print. That mark and trade dress violated

the 1984 Order and was an obvious effort to enter a market in which it had no

strategic business plan, no budget, no advertising plan, no experience and no

presence, by creating confusion and benefiting from consumers mistaken

association of the USPA Marks with the reputation and good will of the PRL



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Parties and their best-selling fragrance products.26

See district courts opinion at

A-2315.

USPA also stated during the litigation and in its appeal brief that it had

justifiable reasons for adopting blue packaging, namely, that consumers would

associate its fragrance with the color of certain tags,27

although hardly visible and

located on the inseam, waistband, hangtag and hook of certain articles of apparel.28

Tags on the inseam of a pair of shorts cannot be said to function as source

identifiers or provide the basis for associating USPAs other goods with its

fragrance. The district court appropriately found USPAs testimony not to be

persuasive. A-2314.

USPAs efforts to explain away its bad faith are unavailing. The record

clearly establishes that the PRL Parties had used the PRL Marks on fragrances

since at least 1978.29

That the Double Horseman logo purportedly was developed

before PRL launched its POLO BLUE product does nothing to negate USPAs bad

faith in adopting and using the USPA Mark and offensive trade dress after PRLs

launch. Bad faith relates to adoption and use. By the timeUSPA started to use the

26A-1054:22-1056:8, A-1056:9-1057:10.

27A-1043:9-12.

28A-1041:13-A-1043:13.

29A-814:11-A-815.



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USPA Mark (including the Double Horseman logo and U.S. POLO ASSN. word

mark) in connection with the blue trade dress, POLO BLUE was well established

as a market-leading fragrance. A-816:8-14; A-819:23-24; A-832:1-12.

USPAs appeal brief states that [b]efore LOral filed its motion for

a preliminary injunction, the [USPA] decided to use other principal colors for

packaging in connection with fragrance products. This decision was made in an

effort to focus the declaratory judgment action on the use of the Double Horseman

mark rather than the trade dress.30 However, the record evidence is to the

contrary. Between the middle of November 2009, when USPAs declaratory

judgment complaint was filed and USPAs fragrance displaying the Double

Horseman logo was first introduced, and the second half of February 2010, when

USPA claims to have made the decision to drop the color blue as the predominant

background color for its fragrance packaging, nothing changed concerning the

conflict with the PRL Parties.31

The evidence shows that the decision to change

packaging color was made, abruptly and without explanation, on March 4, 2010,

afterLOral filed its motion for a preliminary injunction, which attached the

30Appellants Br. 15-16, citing A-1003:16-1004:10.

31A-1044:7-1045:9; A-1048:20-1049:3.



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report and results of its first consumer survey demonstrating a very high likelihood

of confusion.32

As previously noted, the jurys finding regarding the Double Horseman logo

in the Apparel Litigation is irrelevant to the issues involved in this case.

Regardless, the district court clarified that its finding of bad faith was based in part

on USPAs initial adoption and use of the blue packaging. Therefore, the mark

before the district court was not the Double Horseman logo that had been

considered by the jury in connection with apparel, but a mark consisting of the

Double Horseman logo, the wording U.S. POLO ASSN., and the blue trade dress.

The purported coexistence of one of those elements namely, the Double

Horseman -- with the PRL Marks in other categories of goods is irrelevant and

does nothing to mitigate USPAs bad faith in adopting and using the mark as

a whole, including the infringing trade dress, in 2009. Moreover, at the time that

USPA adopted and used that mark for fragrances, it was aware of the TTAB Order

that rejected USPAs arguments regarding the relatedness of apparel and

fragrances, suggesting that any claims USPA makes that it relied on the Apparel

Litigation is itself indicative of USPAs bad faith.

32A-1733; A-1003:16-A-1004:10, A-1047:22-A-1049:3.



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Finally, USPAs argument that the use of the color blue in trade dress

cannot support a finding of bad faith is extremely difficult to reconcile with the

1984 Orders prohibition against the use of a mounted polo player used in

conjunction with trade dress, i.e., labels, hangtags and packaging that use white or

silver lettering on a blue background. The fact that USPA adopted and used blue

packaging that mimics PRLs best-seller, POLO BLUE, for USPAs own fragrance

product is strong evidence of USPAs bad faith. Using barely visible tags on the

inseams of certain apparel items hardly provides a basis for excusing the wholesale

copying of PRLs trade dress for fragrances.

The district court considered USPAs arguments regarding its good faith

adoption of the USPA Mark in connection with fragrances and found them

unavailing.33

That determination was well reasoned and well supported by the

record evidence. It was far from clear error.

D.The District Courts Analysis of thePolaroidFactor RegardingSimilarity of the Marks Was Properly Conducted

USPA argues that the district courts analysis regarding the similarity of the

parties marks one of the required Polaroidfactors was improper because it

should have considered such factors as each partys use of its own marks on

apparel, the relationship between the fragrance and apparel markets and

33A-2313-A-2315 and A-2331-A-2346.



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consumers ability to distinguish [USPAs] marks from PRLs marks.34

USPA

provides no pertinent legal authority for that proposition. USPA again attempts to

use the Apparel Litigation preclusively despite the difference in the marks there

and here. Quite naturally, the jury in the Apparel Litigation made no separate

findings regarding the similarity of the marks there being considered. The jury

rendered a final verdict of non-infringement (with respect to three of the four

marks considered), without detail as to why. It may be that the jury found the

marks to be highly similar but that other factors weighed against a finding of

infringement on the facts of that case. We do not and cannot know. It would have

been improper for the district court here to defer its responsibility to conduct an

analysis of the similarity of the marks.

The district court conducted an appropriate and traditional analysis of the

similarity of the parties respective marks in appearance, sound and meaning to

determine whether the similarity between them is likely to cause confusion among

potential customers, taking into account the context in which the marks are

displayed and the totality of factors that could cause confusion. Louis Vuitton

Malletier v. Burlington Coat Factory Warehouse, 426 F.3d 532, 537 (2d Cir.

2005); Grotrian, Helfferich, Schulz, Th. Steinweg Nachf. V. Steinway & Sons, 523

34Appellants Br. 33.



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F.2d 1331 (2d Cir. 1975). The marks at issue here will not be displayed side-by-

side in the marketplace.35

The question to be considered in the similarity analysis,

therefore, is not whether differences are easily discernable on simultaneous

viewing, but whether they are likely to be memorable enough to dispel confusion

on serial viewing. Louis Vuitton, 426 F.3d at 538. The analysis should consider

the products sizes, logos, typefaces, and package design and colors to determine

whether the overall impression in the relevant market context would lead

consumers to believe that the product emanates from the same source as products

bearing the senior users mark. Paco Sport, Ltd. v. Paco Rabanne Perfumes, 234

F.3d 1262 (2d Cir. 2000).

USPA argues that a proper analysis of the similarity between the marks

would have excluded consideration of the visual similarities between the marks,

but would have included each partys use of its own marks on apparel, the

relationship between the fragrance and apparel markets, and consumers ability to

distinguish the [USPAs] marks from PRLs marks.36

The district court

considered that argument and correctly found it unpersuasive because [n]o prior

decision addressed the marks at issue here in the fragrance market, and the

similarity of marks analysis focuses on the particular industry where the marks

35A-824:6-9; 44:21-45:13; A-1065:4-10, A-1068:14-1069:4.

36Appellants Br. 32-33.



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compete.37

Further, no prior decision addressed the similarity of the marks at

issue in this case in connection with any products, as the marks before the court in

1984 and 2006 differed from the USPA Mark at issue here. The district court held

that there was insufficient evidence to make a conclusion either way regarding

consumers ability to distinguish between the parties marks in the apparel

market.38

Despite USPAs assertion that there is no evidence of a difference

between the apparel and fragrance markets, witnesses for PRL and LOral

credibly testified to the differences between the markets, the customers, the

shopping experience and the manner and context in which the marks would be

encountered in the fragrance market versus the apparel market.39

Although it may not be proper for a fact finder to make a determination of

infringementbased solely on a side-by-side visual comparison of the marks at

issue, a visual comparison of the marks is not only acceptable but also expected

when conducting an analysis of the Polaroidfactor that expressly relates to the

similarities -- including the visual similarities -- between the marks. The district

court conducted such an analysis, considering the totality of factors that could

cause confusion, and described in detail the striking similarities between the marks

37A-2294-A-2295 (internal citation omitted).

38A-2301.

39A-814:11-A-815:3; Darsses Dep. 192:11-193:21.



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in content, perspective, proportion, typeface, design, color and connotation, taking

account of the logo, the word mark and the overall packaging. The courts

determination regarding the similarity of the marks here at issue was not clearly

erroneous.

E.The District Court Properly Concluded That Apparel andFragrances Constitute Separate Markets and That The Purported

Relatedness Between Them Was Irrelevant

The USPA Parties misunderstand the concept of related goods in the

trademark infringement context as well as the concepts of bridging the gap and

natural zone of expansion. Only a plaintiff (the senior user) may actually or

potentially bridge the gap or naturally expand, as a means of protecting its mark

against a defendant that uses an infringing mark on different goods. Those

concepts may not be invoked by a defendant (junior user). The reliance by USPA

on the cases it cites to support its contention that the right to expand into the

fragrance market is protected by its prior use (albeit of a different mark) in the

related apparel market is misplaced. Those cases all involve actions regarding

the use of a mark by a junior user in connection with goods other than those

offered by the senior user. In such cases, courts consider the relatedness of the

goods and/or markets to determine whether the senior users use on one category

of goods nonetheless is entitled to protection against a second-comers use on

similar but non-competitive goods, because the goods are so closely related that



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consumers are likely to believe that they emanate from the same source. 4

McCarthy on Trademarks and Unfair Competition 24:1, at 24-7-8 (4th ed. 2012).

The cases cited by the USPA Parties do not disagree. See Jaguar Cars Ltd. v.

Skandrani, 771 F. Supp. 1178 (S.D. Fla. 1991) (senior userof a strong mark may

protect mark against junior user, even were junior user first to use mark on goods

in issue). See also Scarves By Vera, Inc. v. Todo Imports Ltd., 544 F.2d 1167 (2d

Cir. 1976) (senior userprotected from use of mark by junior user on related

goods). Where the goods at issue are identical, as they are here, the concepts of

relatedness, bridging the gap (as to products) and zone of natural expansion do not

apply. They certainly cannot be used defensively by the junior user seeking to

enter a product category using an infringing mark, and USPA has not cited a single

case to the contrary.

Moreover, although USPA insists that its move into the fragrance market

was a natural extension of its retail licensing program, USPA Properties president,

Mr. Cummings, admitted at trial that he was not aware of a single sporting

association that licenses its trademark for use in connection with mens fragrances

(although many license their marks for use in connection with apparel).40

There is

nothing natural about a sports association for polo or any other sport

40A-1038:4-1039:6.



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extending its licensing program into the market for mens fragrances. Despite

USPAs insistence to the contrary, the market for and marketing of fragrances

differs greatly from the market for and marketing of apparel.41

Specifically, PRLs

Vice-President of Brand Management testified that apparel and fragrances are

different businesses, it is not just a matter of the price point being the same; that

people shop for apparel and fragrances differently; that the consumer base for PRL

fragrances is not the same as for PRL apparel; that the consumer experience of

shopping for fragrances is vastly different from the marketplace context of

shopping for apparel; and that the fragrance market presents greater opportunities

for consumer confusion and brand damage than the apparel market.42

USPAs reliance on Times Mirror Magazine, Inc. v. Field & Stream

Licenses Co.,294 F.3d 383 (2d Cir. 2002) is misplaced inasmuch as the court there

held that neitherparty was the senior user of the marks with respect to the goods at

issue and the question was which party had the right to expand its use into that

market. Here, there is no dispute that PRL is the senior user of the Polo Player

Logo and POLO mark in the fragrance market. USPA mistakenly frames the issue

as its being the senior user of the U.S. POLO ASSN. mark on apparel and states

that it has the right to expand its use of the mark into the related fragrance market

41Darsses Dep. 192:11-193:21.

42 Id.; Darsses Dep. 103:16-23.



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unless that use is specifically found to be confusing with PRLs existing marks.43

As noted, that is a misstatement of the law. First, where marks are not identical,

each party always is the senior user of its own specific mark. To refer to USPA

as the senior user of the U.S. POLO ASSN. mark on apparel is nonsensical

(particularly when PRL is indisputably the senior user of marks using the term

POLO in connection with apparel). Second, USPAs rights, whatever they may be,

to use certain marks in connection with other goods do not give it any rights to

expand its use of those marks to different goods where to do so would violate the

tradema

u.s. polo association v. prl usa holdings, 12-1346-cv (2d cir.) (appellee l'oreal's 10-16-12...

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