Energy drinks battle over trade dress

Oh, for the simpler days of the cola wars. Today's beverage market brings us wars between threatening energy drink creatures. The Ninth Circuit Court of Appeals recently sided with a Freek over a Monster in Hansen Beverage Co. v. National Beverage Corp.

Powering up

Hansen produces and markets the Monster Energy line of beverages. Its containers feature a clawed-out M and the word "Monster" on a dark background with a bold accent color. National sells Freek energy drinks packaged in containers with dark backgrounds and distinctive accent colors. The package features the word "FREEK" in stylized font and a distorted image of a "frightening, evil-eyed creature's face."

When Hansen brought a trade dress infringement claim against National, the district court granted a preliminary injunction prohibiting National from manufacturing, distributing, promoting and selling Freek drinks in their current containers.

On appeal, National argued Hansen hadn't demonstrated the requisite probable success of its claim.

Trade dress ingredients

Trade dress refers to a product's total image - including features like size, shape, color, color combinations, texture and graphics. Under Section 43(a) of the Lanham Act, a plaintiff must establish that its trade dress is protectable and the accused product's trade dress creates a likelihood of consumer confusion.

There was no dispute that Monster's package features "protectable, source-identifying marks." So the court was left to consider only whether Freek's trade dress created a likelihood of confusion.

The Ninth Circuit determines this by assessing eight factors:

1. The strength of the mark,
2. The proximity or relatedness of the goods,
3. The similarity of the marks,
4. Evidence of actual confusion,
5. The marketing channels used,
6. The degree of care customers are likely to exercise in purchasing the goods,
7. The defendant's intent in selecting the mark, and
8. The likelihood of expansion into other markets.

The court cautioned against a mechanical application of the factors. Some factors may prove more important than others, depending on the situation.

Not to the court's taste

In this case, the court focused on the dissimilarities of the graphics and marks in the trade dress as most probative of confusion. Similarity, it explained, is determined by the appearance, sound and meaning of the marks when considered in their entirety as they appear in the marketplace.

The Ninth Circuit found the trade dresses at issue to be similar in overall appearance only to the extent they both feature "aggressive" graphics and bold colors on dark backgrounds. As the court noted, these design elements are common in the energy drink market and "therefore are unlikely to lead to confusion as to source."

Further, Freek's trade dress doesn't feature either of Monster's source-identifying marks - the word "Monster" and the large M. Rather, Freek prominently displays its trade name and a graphic of a distorted and frightening face (the so-called "Freek Man"). These significant differences weighed heavily against the conclusion that consumer confusion is likely to result.

"Monster" mash?

Hansen argued that confusion was likely because "Monster" and "Freek" are confusingly similar in meaning, and the Freek Man is the picture equivalent of a monster. The court ruled that the word "monster" is too indefinite and general to support a finding of consumer confusion.

It also rejected the claim that Freek Man is the picture equivalent of a monster under the doctrine of word-picture equivalency. The court found the doctrine is applicable only when "the word mark and its pictorial representation are concrete and narrowly focused." This would include, for example, a picture of nuts and a stein of beer for "Beer Nuts" and a picture of a jockey on a horse for "Jockey."

Drink it up

In the end, though, the discussion was moot. The court vacated its opinion after the parties settled their dispute. But in crowded product markets, businesses need more than vague similarities and elements used by numerous competitors to achieve protectable trade dress.