November 22, 2014
November 21, 2014
November 20, 2014
Eleventh Circuit Raises its Glass to the Public Domain; Affirms Summary Judgment Entered Against Miller's Ale House on Trademark, Trade Dress, and Copyright Claims
Score one for McDowell's and its "Golden Arcs."  In a dispute between two sports bar and restaurant chains, the Eleventh Circuit has affirmed a grant of summary judgment in favor of the defendant, Boynton Carolina Ale House, LLC ("Boynton Carolina"), who plaintiff Miller's Ale House, Inc.("Miller's") had accused of infringing its alleged common law trademark to the term "Ale House," its trade dress relating to the restaurant's interior decoration, and its copyrighted restaurant floor plans. In so doing, the Court came down on the side of free economic competition and the copying that such open competition encourages, and cautioned against any tendency to allow trademarks in generic terms.
Miller's opened its first sports bar and restaurant in Jupiter, Florida in 1988, and has since expanded to over 50 locations in 8 states. Each Miller's location uses and displays a geographic prefix -- such as a city, street, or neighborhood -- followed by the term "Ale House." The restaurant at issue in this case was located in Boynton Beach, Florida, and was named "Boynton Ale House." Every Miller's location shares common features, such as decor, menu, and employee attire, that contribute to the overall image of the brand.
|Carolina Ale House|
Boynton Carolina is a licensee of LM Restaurants, Inc., a restaurant management company located in Raleigh, North Carolina. LM Restaurants created the Carolina Ale House brand and opened the first restaurant in 1998. Each Carolina Ale House features the same "Carolina Ale House" logo and sign, an example of which is shown on the right. In 2008, Boynton Carolina obtained the license from LM Restaurants to open a restaurant on Congress Avenue in Boynton Beach, Florida, a little over a mile from Miller's Boynton Ale House, which was also located on Congress Avenue.
Boynton Carolina renovated its building's interior and incorporated many elements of Miller's restaurants, including walls paneled with dock wood, an exposed kitchen, a bar located at the center of the restaurant topped with a soffit, "high-top" tables in a portion of the restaurant, and the color red for the restaurant's name on its menus and exterior signage. Also like Miller's, Boynton Carolina prefixed many menu items with its name, and dressed its employees in dark polo shirts and khakis. Despite these similarities, the exterior and interior differed in several ways -- Boynton Carolina was a stand-alone restaurant with outdoor patio seating while Miller's was connected to a shopping center and had no outdoor seating. Further, the layouts inside the restaurant were different, with seating and gaming areas having differing configurations.
Miller's filed suit against Boynton Carolina, claiming that Miller's had common law trademark rights in the term "Ale House" and trade dress rights in the interior decoration of its restaurants, and that Boynton Carolina violated Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a) and the Copyright Act § 106, 16 U.S.C. § 106, when it adopted a name, decor, and a floor plan similar to Miller's own. The U.S. District Court for the Southern District of Florida granted summary judgment in favor of Boynton Carolina on all claims. Miller's appealed, arguing that the district court erred as a matter of law in finding its trademark infringement claim barred by issue preclusion, in finding its trade dress not to be inherently distinctive, and in finding its and Boynton Carolina's floor plans not to be substantially similar.
Trademark in the term "Ale House"?
The Court first addressed Miller's claim that it possessed a valid common law trademark in the term "Ale House." Though Miller's did not register the term "Ale House" as a trademark, "the use of another's unregistered, i.e., common law, trademark 'can constitute a violation of section 43(a) of the Lanham Act.'" In order to prevail, the Court noted that Miller's must have shown that (1) its mark was valid and thus protectable and (2) Boynton Carolina adopted an identical or similar mark that made consumers likely to confuse the two restaurants. To assess the protectability of the the term "Ale House," the Court looked to whether the mark is distinctive, recognizing the four levels of trademark distinctiveness: fanciful or arbitrary (inherently distinctive), suggestive, descriptive, and generic (generally never distinctive).
In a previous case between Miller's and another licensee of LM Restaurants, Miller's tried to prevent the opening of the first Carolina Ale House by asserting the same claims of trademark infringement. The Fourth Circuit found that the words "Ale House" were "generic words for a facility that serves beer and ale, with or without food, just as are other similar terms such as 'bar,' 'lounge,' 'pub,' 'saloon,' or 'tavern.'" Thus, the Southern District of Florida court held that Miller's claim was barred by issue preclusion.
Issue preclusion, which prevents a party from "re-litigating" a factual or legal issue already decided, is applied in Eleventh Circuit courts when (1) the issue at stake is identical to the one involved in the prior litigation; (2) the issue was actually litigated in the prior suit; (3) the determination of the issue in the prior litigation was a critical and necessary part of the judgment in that action; and (4) the party against whom the earlier decision is asserted had a full and fair opportunity to litigate the issue in the earlier proceeding." While the latter three requirements were unquestionably satisfied, Miller's argued that the issues at stake were not identical because the prior suit considered whether "Ale House" was generic in 1998, while this suit concerned the term as of 2009. The Court acknowledged that theoretically through the passage of time the circumstances could change such as to lift a generic term into protectable territory, but it found Miller's evidence "wholly inadequate to indicate that such a drastic change occurred in the public's perception of the term 'ale house.'" Miller's offered two declarations from customers who frequented a different Miller's location in Boca Raton, Florida, where Carolina Ale House does not even have a restaurant. Miller's also offered some evidence of customer confusion, but confusion is "irrelevant unless the mark is protectable in the first instance."
The Court found that Miller's had no protectable interest in the term "ale house," because "a generic name may not receive trademark protection," and thus the district court properly granted summary judgment on Miller's trademark infringement claim.
Trade dress in interior decoration?
Next, the Court analyzed Miller's claim that Boynton Carolina infringed on its unregistered trade dress in violation of Section 43(a) of the Lanham Act. The Court noted that "trade dress is a complex composite of features," which may include "size, shape, color or color combinations, texture, graphics, or even particular sales techniques," and that "all of the features [must] be considered together, not separately." To bring a successful trade dress infringement claim under the Lanham Act, a plaintiff must prove that (1) the defendant's product is confusingly similar to its product; (2) the similar features of the two products are primarily non-functional; and (3) the plaintiff's product is distinctive. The district court found that Miller's had not met its burden of demonstrating that the allegedly protected elements were distinctive, and thus it granted summary judgment against Miller's without addressing the other first two factors.
Trade dress may be distinctive in two ways: either it serves to identify the source of the product and thus is inherently distinctive, or it may acquire secondary meaning and become distinctive. Miller's conceded that it produced no evidence that its trade dress had acquired secondary meaning, so the sole question was whether the trade dress was inherently distinctive. Under the so-calledSeabrook test, the court must consider "whether it is a 'common' basic shape or design, whether it is unique or unusual in a particular field, and whether it is a mere refinement of a commonly-adopted and well-known form of ornamentation for a particular class of goods viewed by the public as a dress or ornamentation for the goods." The Court remarked that all of the elements of Miller's restaurant were simply not unique, from the red lettering on its signage and menu, to the staff's dress, to the wood paneling and high-top seating. Instead, the Court found them all to be "mere refinements" of common and well-known forms of decoration. As a result, the Court concluded that Miller's had failed to raise a genuine question of material fact as to the essential element of distinctiveness, and found its restaurant interiors to be unprotectable.
Copyright - floor plans substantially similar?
Finally, the Court addressed Miller's claim that the floor plan of Boynton Carolina's restaurant infringed on its copyright in "Ale House Floor Plan Five," one of its five registered floor plans. The Copyright Act extends protection to "architectural works," and requires a plaintiff alleging infringement to prove "(1) ownership of a valid copyright, and (2) copying of [protectable] elements." The parties did not dispute the validity of Miller's copyright, leaving "copying" the only open question. Because Miller's did not present any evidence of direct copying, it was required to show that "the defendant had access to the copyrighted work and that the [protectable elements of the] works are 'substantially similar.'"
To rule on the "substantial similarity" of the works, the Court first had to identify the protected elements of the floor plan. Copyright protection is not available for "individual standard features" of the architectural work, but can cover the "arrangement and coordination" of those features. Here, Miller's claimed that Boynton Carolina had copies the arrangement of several standard features, including the rectangular bar at the center of the restaurant, booth seating to the left of the bar, high-top tables to the right of the bar, a kitchen and freezer area in the back-right, and restrooms in the back-left.
The Court pointed out that copyright protection for architectural works is "thin," stating that substantial similarity exists only "where an average lay observer would recognize the alleged copy as having been appropriated from the [protectable features of the] copyrighted work." Thus, "modest dissimilarities are more significant than they may be in other types of art works." With that basis, the Court remarked that "there are only a limited number of ways to turn a rectangular building into a sports bar and restaurant," and that similarities in the layout can easily occur. After an examination of the two floor plans, the Court agreed with the district court's conclusion that the differences "here are dramatic and overwhelming, and that the similarities between [Boynton Carolina's] layout and Miller's floor plan exist only at the broad conceptual level." Thus, the Court held that "[a]t the level of protectable expression, the differences between the designs are so significant that no reasonable, properly instructed jury could find the works substantially similar."
Having found no error in the lower court's rulings, the Eleventh Circuit affirmed the grant of summary judgment in favor of Boynton Carolina on all claims.
The decision is Miller's Ale House, Inc. v. Boynton Carolina Ale House, LLC, 2012 U.S. App. LEXIS 26049 (11th Cir. December 20, 2012). The published opinion can be viewed here.
 This fictional restaurant was featured in Eddie Murphy's classic, Coming to America, in which owner Cleo McDowell said: "Look, me and the McDonald's people got this little misunderstanding. See, they're McDonald's...I'm McDowell's. They got the Golden Arches, mine is the Golden Arcs. They got the Big Mac, I got the Big Mick. We both got two all-beef patties, special sauce, lettuce, cheese, pickles and onions, but their buns have sesame seeds. My buns have no seeds." Comedy aside, this article is not suggesting that McDowell's would have fared as well as the defendant in the present case.
 Miller's Ale House, Inc. v. Boynton Carolina Ale House, LLC, 2012 U.S. App. LEXIS 26049 at *8 (11th Cir. December 20, 2012) (citing Crystal Ent. & Filmworks Inc. v. Jurado, 643 F.3d 1313, 1320 (11th Cir. 2011)).
 Id. at *8-9 (citing Leigh v. Warner Bros., Inc., 212 F.3d 1210, 1216 (11th Cir. 2000)).
 Ale House Mgmt. v. Raleigh Ale House, 205 F.3d 137, 141 (4th Cir. 2000).
 CSX Transp., Inc. v. Bhd. of Maint. of Way Empls., 327 F.3d 1309, 1317 (11th Cir. 2003).
 Miller's Ale House, 2012 U.S. App. LEXIS 26049 at *14-20.
 Id. at *20-22 (citing Boston Duck Tours, LP v. Super Duck Tours, LLC, 531 F.3d 1, 21 (1st Cir. 2008) ("[T]rademark law ... is not intended to prevent confusion between two similar, generic marks.").
 Am. Greetings Corp. v. Dan-Dee Imports, Inc., 807 F.2d 1136, 1141 (3d Cir. 1986); AmBrit, Inc. v. Kraft Inc., 812 F.2d 1531, 1535 (11th Cir. 1986). For more background on the law of trade dress infringement, see our November 26, 2012 post dealing with the subject.
 Dippin' Dots, Inc. v. Frosty Bites Dist., LLC, 369 F.3d 1197, 1202 (11th. Cir. 2004).
 Wal-Mart Stores, Inc. v. Samara Bros., Inc., 529 U.S. 205, 211 (2000).
 Brooks Shoe Mfg. Co. v. Suave Shoe Corp., 716 F.2d 854 (11th Cir. 1983); Seabrook Foods, Inc. v. Bar-Well Foods, Ltd., 568 F.2d 1342 (C.C.P.A. 1977). The Court determined that the Supreme Court's Wal-Mart decision did not nullify the Seabrook test's application for this type of trade dress.
 Miller's Ale House, 2012 U.S. App. LEXIS 26049 at *30-31.
 Oravec v. Sunny Isles Luxury Ventures, L.C., 527 F.3d 1218, 1223 (11th Cir. 2008).
 Id. at 1225.
 Oravec, 527 F.3d at 1224.
 Howard v. Sterchi, 974 F.2d 1272, 1276 (11th Cir. 1992).
 Miller's Ale House, 2012 U.S. App. LEXIS 26049 at *39-40.