New Balance v. Converse PDF
New Balance v. Converse PDF
New Balance v. Converse PDF
v.
JURY TRIAL DEMANDED
CONVERSE INC.,
Defendant.
Plaintiff New Balance Athletic Shoe, Inc. (New Balance) owns PF FLYERS, a
famous athletic footwear brand whose shoes are comprised of a canvas upper, toe bumper, toe
cap, and striped midsole. New Balance acquired PF Flyers in 2001, but the brand and
accompanying designs have generally been available in the marketplace since at least as early as
the 1940s. Defendant Converse Inc. (Converse) sells CHUCK TAYLOR ALL STARS brand
athletic footwear that are comprised of design elements similar to the PF FLYERS. Converse
Chuck Taylors have likewise been available for a very long time.
PF Flyers
Converse
2.
This case concerns Converses recent aggressive efforts to protect its alleged
New Balance was not named as a party in any of these enforcement actions. A
fair reading of the ITC complaint, however, reveals that Converse asserts trademark rights that, if
upheld by the Commission, may improperly affect PF Flyers ability to compete with Converse.
Equally as troubling, Converses ITC complaint seeks a general exclusion order that purports
to target the named respondents, but is broadly written so as to also potentially exclude long-time
legitimate competitors, such as PF Flyers.
4.
Given the parties mutual standing in the athletic footwear industry and the
absence of any consumer confusion between their products, New Balance reached out to
Converse in an attempt to clarify and memorialize the scope of Converses enforcement actions
as excluding PF Flyers. New Balances concerns with the scope of Converses enforcement
actions were apparently well-founded. Not only did Converse refuse to carve out PF Flyers, but
it threatened to amend the ITC Action to add New Balance as a respondent and to otherwise seek
to enjoin the sale of PF Flyers products. Subsequent efforts to avoid this dispute have been
unsuccessful.
5.
As set forth more fully below, New Balance seeks a declaratory judgment of non-
infringement because Converse does not have the exclusive right to use a toe bumper, toe cap,
and striped midsole in connection with athletic footwear. In addition, there can be no likelihood
of confusion between New Balances use of these non-source identifying elements and
Converses use of the sameindeed, there has been none over the past ten years or, to New
Balances knowledge, since the 1940s.
6.
Moreover, Converse acquired PF Flyers in the 1970s, but was eventually required
to sell the brand in settlement of a Clayton Act antitrust investigation brought by the United
States. See generally United States v. Converse Rubber Corp., et al., Civ. A. No. 72-2075-J,
1972 WL 595 (D. Mass. Aug. 29, 1972). Shown below is a Converse advertisement from the
1970s for the same PF Flyers model shoe shown above that uses the combination of a toe
bumper, toe cap, and striped midsole:
Converses sale of the PF Flyers product line to a third-party approximately 40 years ago
constitutes a ratification of the right to compete using the already historic PF Flyers footwear
designs, as well as acquiescence, estoppel, abandonment, or other equitable bar to any injunctive
relief preventing their use.
7.
For these reasons, and those set forth below, use of the combination of a toe
bumper, toe cap, and striped midsole in connection with athletic footwear elements in connection
with PF Flyers branded athletic footwear does not and cannot constitute infringement of
Converses purported trademark.
8.
trademark registration for the combination of a toe bumper, toe cap, and striped midsole, U.S.
Reg. No. 4,398,753, because the claimed features are either ornamental or functional and cannot
serve as a source identifier, or at the very least, such features have not and cannot acquire
secondary meaning.
PARTIES
9.
New Balance Athletic Shoe, Inc. is a Massachusetts corporation with its principal
principal place of business at One High Street, North Andover, Massachusetts 01845.
JURISDICTION AND VENUE
11.
This action arises and is brought under the Declaratory Judgment Act, 28 U.S.C.
2201 and 2202, seeking a declaration of the rights and/or other legal relations of the parties to
this litigation with respect to an actual controversy arising under the trademark laws of the
United States, 15 U.S.C. 1051, et seq. This action also arises and is brought under the Lanham
Act, 15 U.S.C. 1119, seeking cancellation of Converses federal trademark U.S. Reg. No.
3,258,103. Thus, the Court has subject matter jurisdiction under 28 U.S.C. 1331, 1338, and
2201.
12.
This Court has personal jurisdiction over Converse as it is does continuous and
systematic business in Massachusetts and this District. See MASS. GEN. LAWS ch. 223A, 3.
13.
part of the events giving rise to this action occurred in this District and have caused damage to
New Balance in this District.
FACTS
New Balance and the PF FLYERS Brand
14.
New Balance is a private company that was founded in 1906. Today, New
Balance is one of the largest athletic shoe companies in the world, with over 4,000 employees
and approximately $2 billion in annual sales worldwide in 2013. It is the only major company
that manufactures athletic footwear in factories in the United States.
15.
Since its earliest days, New Balance has focused on fit and authenticity as its core
brand message. New Balance is one of the few athletic footwear manufactures to make shoes in
true width sizing, rather than the more common narrow and wide. Because of its brand qualities
New Balance has among the most brand-loyal customers in the marketplace. New Balance won
the No. 1 Customer Loyalty Award in the athletic footwear category for eight consecutive years
from Brand Keys, an independent group that identifies the brands that are best able to engage
consumers and create loyal customers.
16.
New Balance acquired the PF FLYERS brand in 2001. As described more fully
below, PF FLYERS is an iconic brand in the athletic footwear industry with a long history of
success. For example, in 1958 PF Flyers released a model that was endorsed and worn by the
Boston Celtic and future Hall-of-Fame basketball star Bob Cousy. In that year alone, PF Flyers
sold 14,000,000 pairs of shoes.
17.
Since acquiring the brand, New Balance has spent millions of dollars marketing
PF FLYERS brand shoes. New Balance has focused on remaining true to the original shoe
designs and branding the shoes consistent with their classic heritage.
18.
Field Flannels, a well-known maker of authentic reproduction vintage sporting goods, to create a
special Ebbets Field edition of PF Flyers Center-Hi shoe. The collaboration was an enormous
success and widely reported in the footwear and style press.
19.
Flyers and the goodwill it represents has become a valuable asset of the company.
20.
PF Flyers shoes are sold with the famous PF FLYERS branding prominently
shown in various places on the shoe (models vary) and accompanying packaging. Converse does
the same with its shoe:
PF FLYERS
21.
PF Flyers marketing also uses the famous PF FLYERS brand, emphasizes the
brands traditional green color, and generally employs a look and feel that is entirely different
from Converse.
22.
For the last ten years, PF Flyers have competed directly with the Converse
CHUCK TAYLOR ALL STAR brand shoesjust as they had historically for many decades.
On information and belief, the parties shoes have been sold to the same consumers, through
similar marketing and sales channels, and at comparable price points.
23.
During that time, Converse never indicated that PF Flyers footwear infringed
Converses claimed trademark in the combination of a toe cap, toe bumper, and striped midsole.
It never raised any issue of actual or potential confusion among consumers. Given their position
in the athletic footwear industry, the parties have historically worked cooperatively to address
business issues as they arise from time-to-time. Despite this generally positive relationship,
Converse said nothing about PF Flyers for ten years.
24.
between the parties goods or any harm to Converses claimed goodwill and New Balance is
entitled to a declaration of non-infringement.
25.
using a combination of a toe cap, toe bumper, and striped midsole bear PF FLYERS house
marks, either on the footwear or in connection with its marketing or sale, the parties products
are sufficiently distinct so as to preclude any cognizable confusion or harm to goodwill.
PF Flyers Historic Use and Fame
26.
Athletic footwear comprised of a canvas upper combined with a toe cap, toe
bumper, and striped midsole have been sold since at least as early as the 1940s. PF Flyers were
originally sold by B.F. Goodrich under the name PF for Posture Foundation, deriving its
name from an insert that supported the arch. The shoes were among the first and most popular to
use the combination of design elements at issue.
27.
The shoes were such a success that in 1944 a childrens line was added and
28.
The shoe continued to be widely marketed and sold throughout the 1940s and
1950s. In 1958 PF Flyers released its enormously successfully Bob Cousy shoe, which has been
credited as the first collaboration between a shoe company and a professional athlete. Below is
an advertisement showing the construction of the high top model, including its toe cap, toe
bumper, and striped midsole:
29.
Between 1952 and 1963 sales peaked at 25,000,000 pairs annually and PF Flyers
PF Flyers continued to sell footwear using a toe cap, toe bumper, and striped
midsole throughout the 1960s and into the early 1970s. The footwear was heavily marketed
during this time in print and on television, including advertising tie-ins with popular television
shows such as the Mickey Mouse Club, American Bandstand, Bozo the Clown, and the popular
cartoon, Johnny Quest. In 1971 Hank Aarons son was featured in a PF Flyers advertisement
that prominently displayed the toe cap, toe bumper, and striped midsole. See generally Exhibit A
(sample PF Flyers advertising from the 1950s, 1960s, and 1970s).
31.
During this time the PF Flyers slogan Run Faster and Jump Higher became
famous (and, even today, sports fans and sportscasters routinely reference the slogan by using the
phrase hes got his PF Flyers on).
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32.
In the early 1970s, B.F. Goodrich sold PF Flyer to Converse. Converse continued
to sell PF Flyers with the toe cap, toe bumper, and striped midsole as shown in the advertisement
above. Shortly thereafter, the United States asserted claims against Converse under the Clayton
Act and in 1972 it required Converse to sell PF Flyers to a third-party.
33.
Upon information and belief, Converse then sold PF Flyers to a new entity, PF
Industries, Inc., which made PF Flyers for a period of time. See Exhibit B. Thereafter, the brand
was sold to Brookfield Athletic Shoe Co., which was purchased by Hyde Athletic Industries.
LJO, Inc. acquired the brand in 1991 and, upon information and belief, began selling PF Flyers
with the combination of a toe cap, toe bumper, and striped midsole. See Exhibit C. While a part
of LJO, PF Flyers had an 85% consumer recognition factor according to a national survey.
34.
standing continuous use of the combination of a toe cap, toe bumper, and striped midsole. On
information and belief, this fame and well-known use continues to influence consumer
perception even today. As a result, even putting aside New Balances own more recent and
consistent ten years of use, Converse cannot demonstrate that consumers exclusively associate
the combination with Converse as source.
35.
claim constitutes an implied or express acknowledgment of the right of the purchaser to continue
to make shoes of the then existing PF Flyers designs. At a minimum, these circumstances
demonstrate that the then existing PF Flyers designs were not confusingly similar to Converse
footwear bearing the now-claimed trademark. As such, Converses sale constitutes
acquiescence, estoppel, abandonment, or other equitable bar to any injunctive relief preventing
use of the same.
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Third Party Use of the Toe Cap, Toe Bumper, and Striped Midsole Combination
36.
is further illustrated by the fact that over the years numerous other third parties also have used
the combination of a toe cap, toe bumper, and striped midsole on substantially similar goods.
For example:
Red Ball
Keds
Hanover
Wilson
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37.
AMF Voit
LaCrosse
Kinney
On information and belief, these shoes were sold in competition with the
Converse CHUCK TAYLOR ALL STAR brand shoes and were sold to the same class of
consumers, through similar marketing and sales channels, and at comparable price points for
many years.
38.
Third-party shoes bearing the combination of a toe cap, toe bumper, and striped
midsole (such as the above) continue to be sold in a robust secondary market for vintage canvas
basketball shoes.
39.
On information and belief, Converse has long since recognized that the
marketplace was comprised of third-party shoes bearing the combination of a toe cap, toe
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bumper, and striped midsole. Indeed, the marketplace was so saturated with shoes bearing the
combination that Converse ran advertisements acknowledging that the combination was not
source identifying and instructing consumers to look for the ALL STAR ankle patch to identify
footwear as coming from Converse. For example:
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40.
exclusively associate the combination of a toe cap, toe bumper, and striped midsole with
Converse as source absent the presence of other indicators of source, such as the CONVERSE,
CHUCK TAYLOR, ALL STAR, or other Converse-related trademarks.
41.
In addition, these and other third party uses, and Converses tolerance of them for
decades, constitute acquiescence, estoppel, abandonment, or other equitable bar to any injunctive
relief preventing use of the combination of a toe cap, toe bumper, and striped midsole by third
parties.
42.
Alternatively, given the nature of the marketplace, to the extent Converse can
establish that present-day consumers associate the combination of elements with Converse, its
rights are extremely narrow and limited to precisely the trademark as registered and no more. In
other words, even if Converse could prove protectable rights and an exclusive association (it
cannot), its rights would not reach the use of a toe cap, toe bumper, and striped midsole
generally, particularly where the use is accompanied by a famous and distinguishing house mark
such as PF FLYERS.
Converses Registration
43.
Despite claiming a first use in commerce in the 1940s, Converse did not apply for
a federal registration for the combination of a toe cap, toe bumper, and striped midsole until
August 6, 2012. The registration issued on September 10, 2013.
44.
mark consists of the design of the two stripes on the midsole of the shoe, the design of the toe cap,
the design of the multi-layered toe bumper featuring diamonds and line patterns, and the relative
position of these elements to each other. See U.S. Regis. No. 4,398,753.
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45.
Despite this relatively narrow description, Converse also claims common law
rights in a one or two midsole stripes in the ITC Action. See ITC Complaint, 10 Dkt No. 3035;
id. at p. 222. In that action, it also asserts infringement against respondents whose footwear does
not replicate the precise Converse design, but merely uses the combination of a toe cap, toe
bumper, and striped midsole.
46.
Converse also recently asserted rights in the general combination of a toe cap, toe
bumper, and striped midsole in a full page advertisement in a leading footwear industry trade
journal, which also appeared on Twitter:
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47.
The text at the bottom of the advertisement reads The combination of the toe
cap, the toe bumper, and the two midsole stripes is a registered trademark of Converse Inc. See
Exhibit D. This claim of rights is over broad as it relates to the trademark as described in the
registration.
48.
Converse submitted its application under Section 2(f) of the Lanham Act.
Reliance on Section 2(f) during prosecution presumes that the mark is descriptive. Indeed, as a
product configuration mark, the claimed mark cannot be inherently distinctive. As a result,
Converses application requires proof of secondary meaning for its claimed mark to be
registrable.
49.
For the reasons set forth above, the registration is subject to cancellation because
Converse has no secondary meaning in the claimed trademark because in the minds of the public
there is no exclusive association between the claimed trademark and Converse as source.
50.
publicly filed with the USPTO in support of a finding of secondary meaning is itself insufficient
to carry it burden to show secondary meaning.
51.
The evidence submitted does not demonstrate the secondary meaning of the
claimed trademark designlimited to the combination of the toe cap, toe bumper, and striped
midsolebecause in all of the examples of use provided the design is accompanied by other
indicators of Converse as source. In other words, every example of the use submitted is either
use on a shoe bearing other Converse trademarks or in an advertisement that includes other
Converse trademarks. Converse submitted no evidence that the claimed mark has any
independent source identifying quality when not accompanied by other indicators of Converse as
source.
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52.
because it does not even assert, much less demonstrate, that the marketing was targeted at the
claimed trademark design, as opposed to the CONVERSE or CHUCK TAYLOR ALL STAR
trademarks, or other attributes of the shoe. The sample advertisements submitted by Converse
include no look-for advertisements which point to the claimed design elements as source
identifiers separate and apart from Converses other marks.
53.
does not even assert, much less demonstrate, that the sales are attributable to the claimed
trademark design, as opposed to the consumer appeal of the CONVERSE or CHUCK TAYLOR
ALL STAR trademarks, or any other functional or aesthetic aspects of the footwear.
54.
Finally, the third-party commentary submitted concerns the renown of the shoe
generally and does not address the independent source identifying aspect of the claimed
trademark.
55.
As a result, the application by Converse to the USPTO was inadequate to carry its
cancellation because it is comprised of ornamental and functional elements that are not
protectable as trademarks. The prevalence of a toe cap and toe bumper across brands
demonstrates that those elements are functional as protection for the toes, whether playing
basketball or otherwise. Indeed, Converses own advertisements call out the functional aspects
of the toe cap and toe bumper. For example, one advertisement listed the Rugged Protective
Toe Guard as one of ten ways the shoe was better than other brands, another listed the Toe
Protecting Guard Double strength at a vital point as one reason the shoes were nine ways
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better than other brands, and another stated that the Double Strength Toe Guard means longer
wear and included it among features that will help your boys win games. See Exhibit E.
These functional attributes apply equally today.
57.
not an essential attribute of the claimed combined elements comprising the registered trademark.
In acknowledgment of the ornamental and non-source identifying role of the stripes, Converse
sells CHUCK TAYLOR ALL STAR brand shoes that include the toe cap and toe bumper, but
that omit the striped midsoles. In addition, Converse permits consumers to eliminate the midsole
stripes in on-line custom ordering of CHUCK TAYLOR ALL STAR brand shoes. If the stripes
truly acted as a trademark (i.e., an indicator of source and not an ornament) Converse would not
permit third-parties to eliminate them. Indeed, the customization program does not permit the
consumer to eliminate the CONVERSE ALL STAR heel patch or the ALL STAR badge on the
ankle, which is consistent with their role as genuine source identifying trademarks.
58.
For these reasons, the Court should cancel U.S. Regis. No. 4,398,753.
Converses Threats to New Balance
59.
As described above, Converse filed its ITC Action on October 14, 2014. In that
action Converse requests that the Commission, among other things, issue a general exclusion
order forbidding entry into the United States of footwear products that violate Converses
common law and federally registered rights in its CHUCK TAYLOR ALL STAR model
footwear. It also filed numerous federal court actions making similar infringement claims
against the same parties.
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60.
Thereafter, New Balance inquired with Converse concerning the proposed scope
of its requested relief. New Balance also provided Converse with a proposed coexistence
agreement.
61.
representative refused to accept the coexistence agreement and expressly threatened to amend the
ITC Action to name New Balance as a respondent. In addition, the representative indicated that
Converse had recently reviewed the PF Flyers website and was of the opinion that PF Flyers
shoes infringed Converses claimed trademark rights.
62.
Since that time the parties engaged in several additional attempts to avoid this
New Balance repeats and realleges the allegations set forth in paragraphs 1-62
64.
This is an action for declaratory judgment and further relief against Converse
above.
Converse has alleged, and New Balance denies, that New Balances PF FLYERS
brands use of the combination of a toe cap, toe bumper, and striped midsole in connection with
athletic footwear infringes Converses alleged common law rights and in its federally-registered
trademark, U.S. Regis. No. 4,398,753.
66.
Converses existing ITC claim for relief and other allegations of infringement
create a reasonable apprehension by New Balance that Converse will seek to affect New
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Balances rights in the ITC Action and/or otherwise file a lawsuit against New Balance asserting
trademark infringement claims under 15 U.S.C. 1051, et seq.
67.
There exists an actual and justiciable controversy between New Balance and
New Balance also seeks a declaration that so long as the PF Flyers products using
a combination of a toe cap, toe bumper, and striped midsole bear PF FLYERS house marks,
either on the footwear or in connection with its marketing or sale, the parties products are
sufficiently distinct so as to preclude any cognizable consumer confusion or harm to Converses
claimed goodwill.
COUNT II
(Cancellation of U.S. Reg. No. 4,398,753)
70.
New Balance repeats and realleges the allegations set forth in paragraphs 1-69
71.
herein.
Converses trademark registration U.S. Regis. No. 4,398,753 for the combination of a toe cap,
toe bumper, and striped midsole in connection with athletic footwear.
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72.
mark are merely ornamental and/or functional and are thus incapable of serving as a trademark,
and therefore ineligible for registration under Section 2 and 45 of the Act (15 USC 1052 and
1127).
73.
mark, as a product configuration, is not inherently distinctive and Converse did not and cannot
prove that the mark has acquired secondary meaning. Converses use of the claimed features has
not been exclusive, and there is no evidence the purchasing public have ever considered the
claimed features themselves as source identifying.
74.
damage to New Balance and others because it unfairly provides Converse with prima facie
evidence of the exclusive right to use claimed trademark in connection with Converses goods.
75.
1119 directing the Director of the Trademark Office to cancel U.S. Reg. No. 4,398,753.
WHEREFORE, New Balance respectfully requests that this Court enter judgment in its
favor and against Converse:
a.
Declaring that New Balances use of a toe bumper, toe cap, and striped
midsole in connection with athletic footwear does not infringe, and at all times has not
infringed, Converses claimed rights in the same;
b.
of a toe cap, toe bumper, and striped midsole bear PF FLYERS house marks, either on
the footwear or in connection with its marketing or sale, the parties products are
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Declaring that Converses use of a toe bumper, toe cap, and striped
midsole in connection with athletic footwear (i) lacks the requisite legal requirements to
be protectable under the Lanham Act and (ii) is not entitled to registration on the
Principal Register;
d.
Ordering that U.S. Reg. No. 4,398,753 be cancelled and directing the
Clerk of Court to transmit notice of the Order to the Director of the Trademark Office of
the United States Patent and Trademark Office;
e.
f.
Granting New Balance such further relief as the Court deems just and
proper.
DEMAND FOR JURY TRIAL
New Balance demands a trial by jury of all claims so triable.
****
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Respectfully submitted,
__/s/ Mark S. Puzella____________
Mark S. Puzella (BBO #644850)
R. David Hosp (BBO #634091)
Sheryl K. Garko (BBO #657735)
FISH & RICHARDSON P.C.
One Marina Park Drive
Boston, MA 02210
Telephone: (617) 542-5070
Facsimile: (617) 542-8906
Email:
[email protected]
[email protected]
[email protected]
Elizabeth E. Brenckman (pro hac vice forthcoming)
FISH & RICHARDSON P.C.
601 Lexington Avenue, 52nd Floor
New York, NY 10022
Telephone: (212) 765-5070
Facsimile: (212) 258-2291
Email:
[email protected]
ATTORNEYS FOR NEW BALANCE ATHLETIC
SHOE, INC.
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