Opp To Motion For Pi

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS BLUE BELL CREAMERIES, L.P. Plaintiff, v. DENALI CO., LLC Defendant, DENALI CO., LLC, DENALI FLAVORS, INC. Counter-Plaintiffs, v. BLUE BELL CREAMERIES, L.P. Counter-Defendant.

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Civil Action No. 4:08-cv-00981 Judge Nancy F. Atlas

BLUE BELL’S OPPOSITION TO DENALI’S MOTION FOR PRELIMINARY INJUNCTION

TABLE OF CONTENTS I.

ISSUES PRESENTED FOR DETERMINATION BY THIS COURT...............................2

II.

BACKGROUND AND STATUS OF THE CASE .............................................................2 A.

III.

SUMMARY OF ISSUES/ARGUMENT.............................................................................3 A.

IV.

V.

Background -- Blue Bell’s Entry into the “_____ TRACKS” Market ....................2

Denali’s Motion for Preliminary Injunction should be denied ................................3

BACKGROUND FACTS RELEVANT TO THE ISSUE OF LIKELIHOOD OF CONFUSION.......................................................................................................................4 A.

“Tracks” as a Designation for an Ice Cream Flavor, Has De Minimis Value Due to Third Party Use..................................................................................4

B.

Blue Bell’s Registered, Incontestable Mark on MOOO BARS®............................5

C.

Blue Bell’s Dairy Cow Tradition.............................................................................6

LAW AND ARGUMENT ...................................................................................................7 A.

There Is No Likelihood of Confusion Between “MOOO TRACKS” and “MOOSE TRACKS” as Used in the Marketplace...................................................7 1.

Denali’s MOOSE TRACK® Asserted Marks, as used in the Marketplace, are Not Strong ........................................................................8 (a)

2.

Prior Use of “MOO(O) TRACKS” by Others Prevents Enforcement of MOOSE TRACKS®..............................................9

Dissimilarity of Marks in the Context of Usage ........................................10 (a)

“MOOO” is a Sound, “MOOSE” is an Animal .............................12

3.

Similarity of Products - MOOO TRACKS, MOOSE TRACKS®, FUDGE TRACKS and BUNNY TRACKS...............................................14

4.

Identity of Advertising...............................................................................14

5.

While Retail Outlets Are the Same, Shelf Space By Brand Must Be Considered .................................................................................................14

6.

Blue Bell Chose MOOO TRACKS in Good Faith ....................................15

7.

Denali’s Evidence of Actual Confusion is De Minimis Even if the Internet Chatters are Confused – Which They Are Not.............................17

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VI.

B.

Denali Has Failed to Prove Likelihood of Confusion............................................18

C.

Denali Must Bear the Burden of Proof of Irreparable Injury.................................18

D.

The Public Interest is Not Served by Diminishing Competition ...........................18

CONCLUSION..................................................................................................................19

ii

TABLE OF AUTHORITIES FEDERAL CASES Amstar Corp. v. Domino’s Pizza, Inc., 615 F.2d 252 (5th Cir. 1980) .............................................................................................11 Armstrong Cork Co. v. World Carpets, Inc., 597 F.2d 496 (5th Cir. 1979) .............................................................................................14 Asics Corp. v. Target Corp., 282 F. Supp. 2d 1020 (D.Minn. 2003)...............................................................................22 Atec, Inc. v. Societe National Industrialle Aerospatiale, 798 F. Supp. 411 (S.D.Tex. 1992) .....................................................................................20 Black Dog Tavern Co. v. Hall, 823 F. Supp. 48 (D. Mass. 1998) .......................................................................................15 Calvin Klein Cosmetics Corp. v. Lenox Labs., Inc., 815 F.2d 500 (8th Cir. 1987) .......................................................................................21, 22 Care First of Maryland, Inc. v. First Care, P.C., 434 F.3d 263 (4th Cir. 2006) ...........................................................................15, 16, 17, 18 Elvis Presley Enter., Inc. v. Capeve, 141 F.3d 188 (5th Cir. 1998) .......................................................................................10, 13 Evergreen Presbyterian Ministries, Inc. v. Hood, 235 F.3d 908 (5th Cir. 2000) .............................................................................................10 First Sav. Bank, F.S.B. v. First Bank Sys., Inc., 101 F.3d 645 (10th Cir. 1996) ...........................................................................................11 Harris County v. Carmax Auto Superstores, Inc., 177 F.3d 306 (5th Cir. 1999) .............................................................................................10 N. Am. Med. Corp. v. Axiom Worldwide, Inc., 522 F.3d 1211 (11th Cir. 2008) .........................................................................................21 New Century Financial, Inc. v. New Century Financial Corp., 2005 US DIST LEXIS 41192, 11 ......................................................................................11 Small Business Assistance Corp. v. Clear Channel Broadcasting, Inc., 210 F.3d 278 (5th Cir. 2000) .............................................................................................13 Sun Banks of Fla., Inc. v. Sun. Fed. Sav. & Loan Ass’n, 651 F.2d 311 (5th Cir. 1981) .......................................................................................11, 12

052680.0041 WEST 6263862 v6 As of July 18, 2008, 3:24 PM

1

Sun-Maid Raisin Growers of California v. Sunaid Food Products, Inc., 356 F.2d 467 (5th Cir. 1965) .............................................................................................14 Union Nat’l Bank of Texas, Laredo, Texas v. Union Nat’l Bank of Texas, Austin, Texas, 909 F.2d 839 (5th Cir. 1990) .............................................................................................10 Waldmann Lighting Co. v. Halogen Lighting Sys. Inc., 28 U.S.P.Q. 2d 1682 (N.D.Ill. 1993) .................................................................................22 STATE CASES Bank of Montreal v. Sunrise Energy Co., 1994 WL. 240792 (S.D. Tex. March 24, 1994).................................................................10 MyGym, LLC v. Engle, 2006 WL. 3524474 (D.Utah Dec. 6, 2006)........................................................................21 Standard Brands, Inc. v. RJR Foods, Inc., 192 U.S.P.Q. 383, 1976 WL. 21135 (T.T.A.B. 1976) .......................................................11 STATUTES 15 U.S.C. § 1114..............................................................................................................................4 15 U.S.C. § 1115(b) .........................................................................................................................9 15 U.S.C. § 1125(a) .........................................................................................................................4 15 U.S.C. § 1125(c) .........................................................................................................................5

2

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS BLUE BELL CREAMERIES, L.P. Plaintiff, v. DENALI CO., LLC Defendant, DENALI CO., LLC, DENALI FLAVORS, INC. Counter-Plaintiffs, v. BLUE BELL CREAMERIES, L.P. Counter-Defendant.

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Civil Action No. 4:08-cv-00981 Judge Nancy F. Atlas

BLUE BELL’S OPPOSITION TO DENALI’S MOTION FOR PRELIMINARY INJUNCTION Plaintiff Counter-Defendant Blue Bell Creameries, L.P. (“Blue Bell”) responds in opposition to the Motion for Preliminary Injunction filed by Denali Co., LLC and Denali Flavors, Inc. (collectively “Denali”) on June 22, 2008.1 Blue Bell construes Denali’s Motion for Preliminary Injunction (“Denali’s Motion”) to seek a preliminary injunction under 15 U.S.C. § 1114, which is Count I of Denali’s Counterclaims. (D.E. # 6). Denali’s Counterclaims for Federal Unfair Competition under 15

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This Opposition is being filed without knowledge of expert reports that Denali will offer during the preliminary injunction hearing set by the Court for June 23, 2008. The Court is thanked for requiring Denali to identify on July 18, 2008, all experts to be called to testify, and to provide draft affidavits of each expert on July 21, 2008; however, Blue Bell formally objects to this Court scheduling the preliminary injunction hearing so quickly that Blue Bell will not have received responses or documents due from Blue Bell discovery requests on July 30, 2008, in order to prepare its best defense.

052680.0041 WEST 6263862 v6 As of July 18, 2008, 3:24 PM

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U.S.C. § 1125(a) (Count II), Federal Trademark Dilution under U.S.C. § 1125(c) (Count III), and State Unfair Competition (Count IV) are not asserted. I.

ISSUES PRESENTED FOR DETERMINATION BY THIS COURT

The fundamental issue that Denali must prove in order to justify a preliminary injunction is that there is a likelihood of confusion between Blue Bell’s usage of MOOO TRACKS and Denali’s MOOSE TRACKS® within the context of the marketplace, including Blue Bell’s distinctive trade dress and well-known dominant brands BLUE BELL® and the COW AND GIRL LOGO ®. Denali must also offer specific evidence of irreparable harm. II.

BACKGROUND AND STATUS OF THE CASE

A.

Background -- Blue Bell’s Entry into the “_____ TRACKS” Market

Desiring to enter the “____ TRACKS” market, which was occupied not only by MOOSE TRACKS® but also by third party “____ TRACKS” flavors, in late 2006, Blue Bell chose the name MOOO TRACKS because (1) Blue Bell had a firm belief that there would be no likelihood of confusion with MOOSE TRACKS® or other “___ TRACKS” flavors, (2) because Blue Bell believed it had a right to use its “MOOO” trademark as used in MOOO BARS® within a natural zone of expansion in the ice cream business, and (3) because Blue Bell’s highly distinctive and well-known dominant brand BLUE BELL®, its COW AND GIRL LOGO, and the trade dress of its cartons convinced Blue Bell that there would be no likelihood of confusion with MOOSE TRACKS® or other tracks marks. Blue Bell generally agrees with Denali’s summary of its 2007 introduction of MOOO TRACKS in a three-gallon size, (Ex. 42) and that beginning in January 2008, Blue Bell began selling MOOO TRACKS ice cream in one-half gallon containers displaying its well-known trade dress. In its product launch in January, Blue Bell sent out press releases and invested in substantial radio, television and billboard advertising to build up its new MOOO TRACKS

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product as a new flavor entry into the “____ tracks” market -- a first time entry for Blue Bell. (Ex. 1, ¶ 5). Blue Bell spent $1,399,113.70 in television advertisements and $390,208.13 in radio advertisements. (Ex. 1¶¶ 15-16; Exs. 29, 30). Blue Bell’s billboards included a series of generic hooves. (Ex. 31). The billboards ran from March 17, 2008, to May 18, 2008, only. (Id.). Blue Bell’s sales territory includes Texas and parts of the Southeastern and Southwestern U.S. (Ex. 12). In its letter of March 17, 2008, Denali demanded that Blue Bell cease and desist using MOOO TRACKS, turn over its original artwork, the names and addresses of all distributors and retailers, and provide an accounting of all units of ice cream sold under the MOOO TRACKS name, as well as the number of units remaining in inventory. (Ex. 43). Since nothing in the Denali letter suggested any room for compromise and litigation was imminent, Blue Bell sued Denali in the Southern District of Texas on March 28, 2008. (D.E. #1). Denali waited until June 22, 2008 to file this Motion for Preliminary Injunction, and on July 11, this Court granted hearing for July 23, denying Blue Bell’s Motion to Consolidate. III.

SUMMARY OF ISSUES/ARGUMENT

A.

Denali’s Motion for Preliminary Injunction should be denied

Denali’s Motion should be denied for at least the following reasons: •

2

Denali is unable to meet its burden of proof that there is a likelihood of confusion. Denali’s Motion asserts that Blue Bell’s MOOO TRACKS infringes Denali’s MOOSE TRACKS®.2 Denali’s Motion and accompanying exhibits offer little substantive evidence. Denali has only offered a comparison of the terms — Blue Bell’s MOOO TRACKS and Denali’s MOOSE TRACKS®. Denali has not taken into consideration (1) the substantially well-known marks BLUE BELL and the COW AND GIRL LOGO; the distinctive carton trade dress in which Blue Bell sells MOOO

Blue Bell understands that specifically, Denali asserts infringement of U.S. Trademark Registration Nos. 1,806,802 and 2,303,587, which are collectively referred to as “MOOSE TRACKS®.”

3

TRACKS and its other products, as compared to the variety of carton trade dresses through which Denali’s licensees sell MOOSE TRACKS. •

Denali’s claim that Blue Bell entered this market intentionally in order to trade upon the goodwill of Denali and its licensees is unfounded. Blue Bell, the third largest ice cream manufacturer in the United States, is well known for its high quality products and does not need to trade upon anyone else’s goodwill.

•

If the Court grants this preliminary injunction, it will be a defacto permanent injunction because Blue Bell will have to give up its investment in MOOO TRACKS as its “___ tracks” ice cream entry, and start all over with a new name and thus lose its continuing development of its “cow” or “dairy” marketing theme and heritage represented in MOOO TRACKS. On the other hand, if this Court denies Denali’s Motion, the status quo of fair competition between the parties will continue.

IV.

BACKGROUND FACTS RELEVANT TO THE ISSUE OF LIKELIHOOD OF CONFUSION

A.

“Tracks” as a Designation for an Ice Cream Flavor, Has De Minimis Value Due to Third Party Use

On August 4, 1998, Denali Flavors, L.L.C. filed a U.S. trademark application on “TRACKS” to identify ice cream in Class 30. (Ex. 21). Denali abandoned that effort in 1999, and no wonder, for by that time “TRACKS” had long been a common name for ice cream.3 While it is possibly only theory, Blue Bell believes that the term “tracks” describes ice creams in which there is typically some kind of swirl, such as a chocolate or caramel swirl, with chocolatecovered inclusions, such as peanut butter cups. This flavor description generally fits third party “______ tracks” users, such as FUDGE TRACKS (identical, Ex. 24 and 25), BUNNY TRACKS (almost identical, Ex. 16), GATOR TRACKS (Ex. 19), MAINE LOBSTER TRACKS (Ex. 20),

3

The abandoned file is unavailable in the U.S. Patent and Trademark Office, so Blue Bell cannot determine if Denali abandoned after rejection. Blue Bell has requested production, but is not entitled to Denali’s response and documents until July 30, 2008. This Court’s setting of the hearing on preliminary injunction prevents Blue Bell from obtaining any discovery from Denali, even though Blue Bell has been diligent in seeking evidence.

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TURTLE TRACKS (Ex. 15), COW TRACKS (Ex. 17), CARAMEL MOUNTAIN TRACKS (Ex. 22), BEAR TRACKS (Ex. 18) and possibly WOLF TRACKS (Ex. 26). While Denali argues through its licensee’s affidavits that Blue Bell copied the MOOSE TRACKS® “flavor profile” of vanilla ice cream with peanut butter-flavored chocolate inclusions and a ribbon of chocolate fudge variegate, in actuality Blue Bell copied the collective flavors of MOOSE TRACKS®, Dreyer’s and Edy’s Fudge Tracks and Bunny Tracks (which also has chocolate covered peanuts).4 (Ex. 16). While Denali argues that its trademarks are strong, incontestable and entitled to the broadest scope, Denali’s failure to clearly identify itself as licensor on the different cartons diminishes the strength of the marks. B.

Blue Bell’s Registered, Incontestable Mark on MOOO BARS®

Blue Bell began use of MOOO with the introduction of its MOOO BARS® ice cream bar in December 1984.

MOOO BARS® is the subject of U.S. Trademark Registration No.

2,090,314, and in that registration, “BARS” is disclaimed apart from the mark as shown. (Ex. 6). Thus, the dominant term in Blue Bell’s MOOO BARS® registration is “MOOO” to identify ice cream confection. Blue Bell has sold $35,000,000 of MOOO BARS® since 2000. (Ex. 1, ¶ 6, Exs. 10, 13).

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Other “tracks” users use very similar flavor profiles. The flavor profile for Gator Tracks is vanilla ice cream, chewy brownie pieces, fudge bits, Reeses bits, in a chocolate brownie swirl. (Ex. 19). Turtle Tracks, a Mayfield (Denali licensee) product, has a flavor profile of vanilla ice cream, chocolate caramel turtles, chocolate-covered pecans in a caramel swirl. (Ex. 15). Blue Bell has made similar flavors in the past. Its “Tin Roof” is vanilla with a chocolate swirl having chocolate-covered pecans. (Ex. 1, ¶ 5).

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U.S. Trademark Registration No. 2,090,314 on MOOO BARS® is incontestable such that the registration is conclusive evidence of Blue Bell’s “exclusive right to use the registered mark in commerce.” 15 U.S.C. § 1115(b).5 C.

Blue Bell’s Dairy Cow Tradition

Blue Bell, the “Little Creamery in Brenham,” has a tradition of promoting its dairy roots. Blue Bell’s television advertisements have often featured dairy cows. (Ex. 1, ¶ 7, Exs. 39, 40). Its dairy tradition led to development of its COW AND GIRL LOGO, which was first used in 1976, and has “walked” the lower perimeter of every Blue Bell carton for 32 years. Blue Bell’s COW AND

GIRL LOGO is the subject of U.S. Trademark Registration No. 1,144,445 (Ex. 5) and is

joined with “Blue Bell” in U.S. Registration No. 3,221,632 (Ex. 7). BLUE BELL itself is the principal brand and has been used by Blue Bell since 1938 and is a registered U.S. trademark. (Ex. 8). In determining the first name for MOOO TRACKS, Blue Bell chose to build upon its MOOO BARS® name and legacy, as further enhanced by U.S. Trademark Registration No. 2,614,293 on MOOO-LLENNIUM CRUNCH (Ex. 49), its line of MINI-MOOOS, a smaller size confection no longer made, and even its Blue Bell Country Store T-shirts entitled “MOOOLICIOUS”. (Ex. 1, ¶ 6, Ex. 11). In choosing a name building on Blue Bell’s dairy theme and its legacy in MOOO BARS®, Blue Bell was confident that there would be no likelihood of confusion with MOOSE TRACKS® or other “___ tracks” trademarks because MOOO TRACKS would be sold in Blue Bell’s well-known solid-color carton trade dress, which

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Blue Bell has not located legal precedent to support a claim of legal priority as a result of its 1984 first use of MOOO BARS® long prior to MOOSE TRACKS® first use in 1992; however, the legacy of MOOO in MOOO BARS® was certainly a logical stepping stone to adopting and promoting MOOO TRACKS as a new Blue Bell flavor. (Ex. 3, ¶ 7).

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always includes its famous brand BLUE BELL as well as its almost-as-famous COW AND GIRL LOGO. (Ex. 1, ¶ 12). V.

LAW AND ARGUMENT

Blue Bell and Denali substantially agree on the legal criteria governing grant and denial on temporary injunctive relief. A preliminary injunction is an extraordinary and drastic remedy granted or denied at the Court’s discretion. Harris County v. Carmax Auto Superstores, Inc., 177 F.3d 306, 312 (5th Cir. 1999). The movant must establish a likelihood of success on the merits, and there must be a substantial threat or irreparable injury if the injunction is not granted, and the threatened injury to the movant must outweigh the threatened injury to the opponent. Evergreen Presbyterian Ministries, Inc. v. Hood, 235 F.3d 908, 918 (5th Cir. 2000). Denali must prove that the likelihood of confusion will actually cause irreparable injury for which there is no adequate legal remedy. Union Nat’l Bank of Texas, Laredo, Texas v. Union Nat’l Bank of Texas, Austin, Texas, 909 F.2d 839, 844 (5th Cir. 1990). Blue Bell further agrees that a preliminary injunction should only be granted where the questions raised against the likelihood of success on the merits are not so serious, substantial and doubtful as to make them fair ground for a more deliberative investigation. Bank of Montreal v. Sunrise Energy Co., 1994 WL 240792, *5 (S.D. Tex. March 24, 1994). (Denali’s Motion at 9). A.

There Is No Likelihood of Confusion Between “MOOO TRACKS” and “MOOSE TRACKS” as Used in the Marketplace

Blue Bell agrees with Denali’s description of the seven digits to be considered in determining likelihood of confusion, as set out below. See Elvis Presley Enter., Inc. v. Capeve, 141 F.3d 188, 194 (5th Cir. 1998).

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1.

Denali’s MOOSE TRACK® Asserted Marks, as used in the Marketplace, are Not Strong

In view of the large number of third-party user of “_____ tracks”, and the fact that Denali itself attempted to obtain a trademark on “TRACKS” and failed (Ex. 21), the term “TRACKS” has minimal impact upon the infringement issue. In determining the strength of a mark, extensive third-party use of similar marks will diminish the strength of that mark. Amstar Corp. v. Domino’s Pizza, Inc., 615 F.2d 252, 260 (5th Cir. 1980); First Sav. Bank, F.S.B. v. First Bank Sys., Inc., 101 F.3d 645, (10th Cir. 1996). Extensive third-party use of a mark or term means that the term deserves weak protection. According to McCarthy, “customers [may] have become so conditioned by a plethora of such similar marks that customers ‘have become so educated to distinguish between different [such] marks on the basis of minute distractions.’”

2 MCCARTHY

ON

TRADEMARKS

AND

UNFAIR

COMPETITION §11:88, at 11-149 (4th ed. 2008) (quoting Standard Brands, Inc. v. RJR Foods, Inc., 192 USPQ 383, 1976 WL 21135 (T.T.A.B. 1976)). Further, extensive third-party use shows the mark has been diluted in the marketplace, and the mark becomes “a less effective vehicle for signifying the exact origin of products or services.” New Century Financial, Inc. v. New Century Financial Corp., 2005 US DIST LEXIS 41192, *11 (S.D.Tex. Oct. 4, 2005). The greater the number of identical or more or less similar marks in use, the less is the likelihood of confusion. First Sav. Bank, 101 F.3d at 653-654. In Sun Banks of Fla., Inc. v. Sun. Fed. Sav. & Loan Ass’n, 651 F.2d 311 (5th Cir. 1981), the Court of Appeals for the 5th Circuit found “Sun Banks” and “Sun Federal Savings and Loan” were distinct and non-confusing. The court took significant note of the extensive third-party use, including within the financial industry, and found the term “Sun” to be weak and diluted. Id. at 316-317. The court stated that “whether an addition is sufficient to prevent confusion in a

8

particular instance depends upon the strength of the main part of the mark and the distinctiveness of the additional features.” Id. at 316. Due to the weakness of “Sun” from third-party use, the court looked to the additional terms for the confusion analysis and found no likelihood of confusion. Denali asserts that its MOOSE TRACKS® marks are very strong because they have been used in interstate commerce since 1992. Denali asserts that the marks have gained “fame throughout North America” and that the purchasing public has come to know and rely upon the marks as indicators of sorts; however, Denali has offered no proof, except conclusions, of any fame or secondary meaning in the form of recognition by the purchasing public. Denali’s usage of MOOSE TRACKS® in the marketplace is limited by the carton trade dress of its licensees who use a wide variety of trade dresses. (Ex. 35). Each carton includes a small Denali blue “flag” that is dominated by the brand of the licensee. (Id.) There is no consistency from one licensee’s carton to another in terms of color or trade dress, and no clear explanation on the cartons that affirmatively state that Denali is a licensor. Someone well-versed in trademark law may deduce the dominant brand is that of a licensee, but Denali’s Motion offers no admissible evidence that the purchasing public have come to understand that. Considering the wide variety of trade dress utilized by licensees, Denali’s asserted marks are not strong as used in the marketplace.

Based upon statistics from Dairy Facts, 2006 Edition, MOOSE

TRACK® is not even listed as a prominent ice cream flavor. (Ex. 32). In comparison, as certainly one of the most prominent ice cream trademarks in the United States, across all of its flavors, which have the same USP number, Blue Bell had the number one ranking for the 52 weeks ending September 8, 2007. (Ex. 33). (a)

Prior Use of “MOO(O) TRACKS” by Others Prevents Enforcement of MOOSE TRACKS®

9

An April 2008 Thomson & Thomson search report shows numerous third-party uses of MOO(O) TRACKS, used in connection with frozen dairy products.

For example, “Dean

Rewards MOOO Tracks Ice Cream Sandwiches” (Ex. 28, pp. 201-2, 210), Mooville Ice Cream Moo-Tracks (Id. at 204), “Choose from strawberry, vanilla, chocolate or MOO Tracks” (Id. at 205-6), “Maggie Moos calls it MOO Tracks” (Id. at 207-8), “My mom had MOO Tracks…” (Id. at 214), “Ice Cream Flavors for the day. Chocolate Moose…MOO Tracks…” (Id. at 218), “[T]hey were trying to decide between Mocha Almond Assault and MOO Tracks…” (Id. at 220), and “Homemade Ice Cream… [various flavors] MOO TRAX…” (Id. at 222). These multiple uses of MOO TRACKS marks suggest that “moo tracks” may be a generic term for a flavor presumably a flavor similar to that of Blue Bell’s MOOO TRACKS product. If so, a recent Fifth Circuit case indicates that such a term cannot infringe an otherwise arguably confusingly similar mark: A trademark cannot be infringed by the generic term for the product it designates. This is true even if consumers are confused by a competitor’s use of a generic term. Small Business Assistance Corp. v. Clear Channel Broadcasting, Inc., 210 F.3d 278, 279 (5th Cir. 2000). This case held that SUMMER JAM, for a summer musical event, could not infringe UNCLE SAM JAM, for the same type of event, simply because “summer jam” was deemed a generic term for such an event. 2.

Dissimilarity of Marks in the Context of Usage

The context in which a mark appears, particularly for goods that are sold side-by-side, has been an important factor in the likelihood of confusion analysis in the Fifth Circuit. According to the Court of Appeals for the Fifth Circuit, “[c]ourts consider marks in the context that a customer perceived them in the marketplace.” Elvis Presley Enter., Inc., 141 F.3d at 197.

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The court has made clear that the fact that two marks may contain the same or similar wording does not, by itself, render the marks confusingly similar: “A mark must be viewed in its entirety and in context. It is the overall impression that counts.” Armstrong Cork Co. v. World Carpets, Inc., 597 F.2d 496, 502 (5th Cir. 1979). The marks at issue in Armstrong were the mark WORLD and the corporate name ARMSTRONG WORLD. In overturning a trial court finding of likelihood of confusion, the Fifth Circuit considered the labels used by each party. Finding the labels dissimilar (and, significantly, the placement and emphasis on the common term WORLD in each label to be very different), the court concluded that use of the marks as shown on the labels did not give rise to a likelihood of confusion. See also Sun-Maid Raisin Growers of California v. Sunaid Food Products, Inc., 356 F.2d 467, 469 (5th Cir. 1965); McCarthy 23:58-60. Denali cannot escape the marketplace -- the context or habitat in which the Denali asserted marks are used. Because Denali’s marks are used across a wide variety of trade dress, the number of “____ tracks” flavors may vary from city to city. In view of time constraints, Blue Bell directs the Court to usage of MOOSE TRACKS® in Houston, Texas, for its licensees Kroger and Randalls. In Randalls’ stores, Denali’s MOOSE TRACKS® is sold under the “Safeway Select” brand. (Ex.37). Within Kroger stores, MOOSE TRACKS® is sold under the brand “Private Selection.” (Ex. 36)6. In contrast, Blue Bell’s MOOO TRACKS is sold in its standardized carton trade dress used across all Blue Bell ice cream, which exhibits most prominently the BLUE BELL mark at the top, with the COW AND GIRL LOGO circling the carton at the bottom, with the MOOO TRACKS flavor name in between. (Ex. 34). Within this context,

6

Photographs taken from a local Wal-Mart displaying Blue Bell’s MOOO TRACKS and BUNNY TRACKS are found in Ex. 38.

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where the Blue Bell marks dominate, and the Denali licensed products are sold under brands such as Safeway Select and Private Selection having different trade dress backgrounds from Blue Bell. Potential purchasers, consumers or even observers are not likely to be confused. (Ex. 2 ¶ 16b.). Although no case law comparing marks starting with “MOOSE” or “MOO(O)” – especially when followed by “tracks” – could be found, a closely analogous case was found. In Black Dog Tavern Co. v. Hall, 823 F. Supp. 48 (D. Mass. 1998), Plaintiff’s THE BLACK DOG and registered Black Dog Design marks were held not infringed by Defendant’s THE BLACK HOG and Black Hog Design marks, despite the fact that both marks were used for some of the very same goods, namely, clothing. Finding Plaintiff’s marks to be “arbitrary or fanciful” and thus “inherently distinctive,” id. at 53, the court analyzed the parties’ marks’ “appearance, sound and meaning.” Id. at 54. As to the word marks, the court said: The written marks utilized by the parties share some common characteristics. Each is comprised of three monosyllabic words: the definite article, an adjective, and a noun denoting an animal. Also, each is printed in the same typeface and appears above the term “Martha’s Vineyard” and, in most instances, the year. “The Black Dog” and “The Black Hog” are most alike in sound and appearance, differing only by one letter…. Despite their phonetic similarities, the parties’ written marks, like their corresponding designs, connote very different meanings. Color notwithstanding, a dog and a hog are two very different creatures, unlikely to be confused in the average person’s mind. Id. at 55 (emphasis added). See also, Care First of Maryland, Inc. v. First Care, P.C., 434 F.3d 263, 271 (4th Cir. 2006). (a)

“MOOO” is a Sound, “MOOSE” is an Animal

The expert report of David Yerkes, a professor of English at Columbia University, analyzes the terms “MOOO” and “MOOSE” from a linguistic viewpoint and concludes that

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MOOO TRACKS and MOOSE TRACKS® are unlikely to be confused. (Ex. 3). According to Dr. Yerkes, because the terms MOOO and MOOSE are the beginning elements, people will find those terms to be most important in trying to comprehend and remember the terms. (Id. at ¶4). MOOO and MOOSE differ significantly in sight; MOOSE is a spelling of a word, while MOOO is a spelling of a noise. (Id. at ¶5). MOOO is an abnormal spelling and is highly distinctive and draws attention to itself. (Id. at ¶6). The three O’s in a row may be understood as directly conveying the actual noise that the cow makes or as a fanciful spelling of the word “moo.” Either way, according to Dr. Yerkes, the spelling of MOOO is highly distinctive and easily comprehended and unlikely to be confused with the spelling of MOOSE. (Id. at ¶7). Because it is so direct and immediate, a spelling such as MOOO grabs a persons attention, however impulsive a person may be, in a way that an ordinary word such as MOOSE cannot. (Id. at ¶9). Dr. Yerkes gives examples of comparable words in which the public can easily distinguish between two words even though they have common elements:

“GOO” and

“GOOSE”; “LOO” and “LOOSE.” As stated by Dr. Yerkes, no one would confuse “GOO TRACKS” with “GOOSE TRACKS,” much less “GOOO TRACKS” with “GOOSE TRACKS.” (Id. at ¶10). MOOO TRACKS and MOOSE TRACK differ significantly in sound. MOOO conveys the sound of the actual noise the cows make, unlikely to be confused with the sound that a word such as MOOSE makes when it is pronounced. (Id. at ¶11). “MOOO” is an onomatopoeic word, which suggests a sound -- the moo of a cow. The addition of the third “O” suggests the sound even over the English word “moo.” (Id. at ¶13). Surprising to those of us who are not linguists, Dr. Yerkes states that it takes longer to say MOOO than it does to say MOOSE because the extra O compels the speaker to take an

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abnormal, perhaps comical, amount of time in saying “MOOO.” (Id. at ¶14). In sum, the meaning of the terms “MOOO” and “MOOSE” -- the actual noise which only suggests the animal versus the actual name of the animal -- distinguishes between the two words. (Id. at ¶17). 3.

Similarity of Products - MOOO TRACKS, MOOSE TRACKS®, FUDGE TRACKS and BUNNY TRACKS

The flavor profiles of both MOOO TRACKS and MOOSE TRACKS® is the same as that of FUDGE TRACKS (Dreyer’s and Edy’s Exs. 24-25) and very close to BUNNY TRACKS (Ex. 16), another track flavor found in Houston. The fact that “tracks” refers to various ice cream flavors having chocolate peanut butter inclusions, and that multiple “_____ tracks” names have essentially the same or similar flavor profiles, the similarity of ice cream flavors is not limited to Blue Bell and Denali’s licensees. 4.

Identity of Advertising

Blue Bell agrees that the advertising media is the same for Blue Bell, Denali’s licensees and third party “______ tracks” ice cream. 5.

While Retail Outlets Are the Same, Shelf Space By Brand Must Be Considered

Blue Bell submits photographs taken from three local stores, as follows: Randalls (Ex. 37) Blue Bell MOOO TRACKS

Dreyer’s Fudge Tracks

Safeway Select MOOSE TRACKS

Kroger (Ex. 36) Blue Bell MOOO TRACKS

Dreyer’s Fudge Tracks

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Private Selection/Interamerican MOOSE TRACKS

Wal-Mart (Ex. 38) Blue Bell MOOO TRACKS

Blue Bunny BUNNY TRACKS

In grocery stores, ice cream is displayed according to shelf space, and shelf space is allotted by brand (Ex. 1, ¶ 10). Blue Bell is very popular in Houston, and often has more shelf space, as compared to other brands. (Ex. 36-38). This allotment of shelf space by dominant ice cream maker brand makes an important point -- value and recognition of the dominant brand of the ice cream maker. When a consumer or potential purchaser approaches the refrigerated banks housing ice cream, the consumer first sees an array of brands, not flavors. (Id.) The consumer needs to know the dominant brand in order to locate the flavor of choice. Blue Bell, as well as all other ice cream makers, invests millions of advertisement dollars into promoting their brands, and they do that because consumers are educated to have the loyalty to the brand, such as Blue Bell. (Ex. 1, ¶ 10). As displayed by brand, ice cream is not a product that an “impulsive buyer” quickly runs up to an array of freezer space, opens a freezer door and grabs a flavor. It is much more likely that there is brand loyalty, and that consumers relate to the ice cream maker brand first, and to the flavor second. In sum, Blue Bell’s MOOO TRACKS is distinctive from the various MOOSE TRACKS® sold by different licensees and other “___ TRACKS” sold by third-party users. 6.

Blue Bell Chose MOOO TRACKS in Good Faith

Denali accuses Blue Bell and its president, Paul Kruse, of a lack of good faith and “evil intent.” (Motion at 15). When Blue Bell chose the MOOO TRACKS name, Mr. Kruse was aware of MOOSE TRACKS®, but he also was aware of third-party users of “___ TRACKS.” (Ex. 1, ¶ 8-9). Mr. Kruse further knew of the tremendous power of the BLUE BELL brand as well as Blue Bell’s reputation and practice of the highest standards for making quality ice cream. 15

Mr. Kruse was confident that consumers would not confuse MOOSE TRACKS® sold under a variety of licensee names with Blue Bell’s MOOO TRACKS ice cream, particularly in view of Blue Bell’s prior use of MOOO in the MOOO BARS ice cream confection for 20 years, third party uses of “_____ tracks” and Blue Bell’s famous name and distinctive trade dress. (Ex. 1, ¶ 12, Ex. 34). Blue Bell wanted to get into the business of making a “___ tracks” ice cream. Blue Bell was moved to use Blue Bell’s own MOOO as used in MOOO BARS® as its primary name for its “tracks” ice cream. Contrary to Denali’s accusations, it was not a matter of choosing one word in the English language out of 500,000, Blue Bell’s and Mr. Kruse’s choice of MOOO fit the context of a “_____ TRACKS” ice cream because it was consistent with Blue Bell’s desire to build upon its dairy heritage of its MOOO BAR® trademark, its MOOO-LLENIUM CRUNCH® trademark, and its prior MINI-MOOS products. Before making a firm decision, Mr. Kruse obtained a Thomson & Thomson search report (Ex. 27), reviewed it, and concluded its MOOO TRACKS would fairly compete in the “_____ tracks” marketplace. Denali argues over and over that Blue Bell copied its flavor. Certainly, the specific MOOO TRACKS flavor was new to Blue Bell, but Blue Bell had made similar flavors in the past. (Ex. 1, ¶ 5). Further, the MOOSE TRACKS® flavor profile is neither proprietary or unique in view of the same “tracks” flavor being sold as FUDGE TRACKS (Exs. 24-25) and the very similar flavor of BUNNY TRACKS, which is the same as MOOSE TRACKS® except that BUNNY TRACKS adds chocolate-covered peanuts. (Ex. 16).

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7.

Denali’s Evidence of Actual Confusion is De Minimis Even if the Internet Chatters are Confused – Which They Are Not

In Denali’s Supplemental Brief (D.E. #17), it references three alleged instances of actual confusion. First, three alleged instances of confusion is not enough to show confusion, as merely a small number of instances may be dismissed as inconsequential or deminimis. (Ex. 2, ¶ 18). As the U.S. District Court for the Southern District of Texas stated, “a drop in the bucket will not support a finding of actual confusion.” Atec, Inc. v. Societe National Industrialle Aerospatiale, 798 F.Supp. 411, 414 (S.D.Tex. 1992). Second, one to two of these instances actually indicate knowledge that MOOSE TRACKS® is from a different source than Blue Bell. The first instance, regarding the blogger from Texas now living in the East, is merely banter in an open internet chat room. This blogging is clearly outside the marketplace and does not consider Blue Bell’s trade dress or that of Denali’s licensees. Further, when Leigh states “I’ve also had Moose Tracks and it was very good”, nowhere does she reference or relate MOOSE TRACKS to Blue Bell. Leigh may be assuming that MOOO TRACKS and MOOSE TRACKS® are the same flavor, but may also recognize that Blue Bell MOOO TRACKS is not Denali’s MOOSE TRACKS®. In the second instance, regarding WingsFan, the flavor profile of MOOO TRACKS had been described earlier in the blog thread. WingsFan later states her kids can’t wait to get their hands on this – referring to MOOO TRACKS, and meaning they have not purchased it – and that “in Michigan, they always got an ice cream called Moose Tracks and it’s the same thing.” When WingsFan references “the same thing”, the blogger is clearly referencing the same flavor previously described.

She clearly differentiated between MOOO TRACKS and MOOSE

TRACKS as two different products with the same flavor.

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Last, in the third instance regarding katiedyerr, taking the entire blog in context, the flavor profile of Mooo Tracks was again disclosed. Katiedyerr, recognizing the flavor profile discussed earlier in the blog thread, states “this is my favorite flavor”, then states that “moose tracks is deliciousness.” There is no indication that katiedyerr believes MOOSE TRACKS® is related to Blue Bell, the blog statements merely suggests that she recognized the Blue Bell flavor description as the same as MOOSE TRACKS®. B.

Denali Has Failed to Prove Likelihood of Confusion

Considering the actual market place, the distinctiveness of Blue Bell’s dominant brand displayed on every BLUE BELL carton, the display of ice cream by brand in stores, between “MOOO” and “MOOSE” in sight, sound and meaning, and the lack of evidence that Blue Bell intended to trade upon Denali’s goodwill, Denali has failed to prove a likelihood of confusion. C.

Denali Must Bear the Burden of Proof of Irreparable Injury

Subsequent to the seminal Supreme Court e-Bay case removing the presumption of irreparable injury upon a finding of patent infringement, two trademark cases have raised the question whether there remains a presumption of irreparable injury upon a finding of likelihood of confusion. See N. Am. Med. Corp. v. Axiom Worldwide, Inc., 522 F.3d 1211, 1227-1228 (11th Cir. 2008); MyGym, LLC v. Engle, 2006 WL 3524474, *11-12 (D.Utah Dec. 6, 2006). While Denali may offer proof at the hearing, the affidavits attached to this motion are merely conclusory and do not sufficiently support the movant’s burden of proof of irreparable injury. MyGym, 2006 WL 3524474 at *12. D.

The Public Interest is Not Served by Diminishing Competition

The public interest is not always best served by protecting an allegedly infringed trademark by entering an injunction against the accused mark. There are broader economic implications associated with a preliminary injunction, and needs of the public interest, than

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preemptively enforcing a trademark through injunction. Calvin Klein Cosmetics Corp. v. Lenox Labs., Inc., 815 F.2d 500, 505 (8th Cir. 1987). Courts should look into other public interest factors, such as obtaining the lowest possible prices for consumers, avoiding monopolies and encouraging, not stifling, competition. Id. These factors suggest an injunction is not in the public interest when the movant fails to make a substantial showing of a viable claim, and “the public interest requires preserving the status quo until the issues can be fully adjudicated.” Asics Corp. v. Target Corp., 282 F.Supp.2d 1020, 1032 (D.Minn. 2003). “If defendant is competing lawfully, the public interest supports the denial of an injunction. If defendant is infringing the plaintiff’s trade dress, the “public interest” would be served by the granting of an injunction. As the public interest cannot be determined independently from the substance of the dispute, it is not entitled to much separate weight in the evaluation of the balance of harms between the parties.” Waldmann Lighting Co. v. Halogen Lighting Sys. Inc., 28 USPQ2d 1682, 1686 (N.D.Ill. 1993). VI.

CONCLUSION

Denali brought this Motion late and without fair warning. Denali’s Motion, supported only by attorney argument and conclusory Affidavits in which the topical paragraphs align, should be denied. Blue Bell’s dominant marks, its unique carton, when compared to the array of the cartons and diversity of brands of Denali’s licensees, fully support a denial of Denali’s Motion, which Blue Bell respectfully requests in closing.

Dated: July 18, 2008 Respectfully submitted, /s/ Lester L. Hewitt LESTER L. HEWITT State Bar No. 09559000 [email protected] 19

JAMES L. DUNCAN III State Bar No. 24059700 [email protected] AKIN GUMP STRAUSS HAUER & FELD LLP 1111 Louisiana Street, 44th Floor Houston, Texas 77002-5200 Phone: (713) 220-5800 Fax: (713) 236-0822 Attorneys For Plaintiff/Counter Defendant Blue Bell Creameries, L.P.

CERTIFICATE OF SERVICE

The undersigned hereby certifies that all counsel of record who are deemed to have consented to electronic service are being served with a copy of this document via the Court’s CM/ECF system per Local Rule CV-5(a)(3). Any other counsel of record will be served by email this 18th day of July, 2008.

/s/ Lester L. Hewitt

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