207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) The Squirt Company v. The Seven-Up Company et al. District Court, E. D. Missouri, E. Div. No. 78-375C (A) Decided Sept. 6, 1979 United States Patents Quarterly Headnotes TRADEMARKS [1] Marks and names subject to ownership -- Descriptive -- Misdescriptive or not descriptive -- Particular marks (§ 67.5078) Name "Quirst" is coined, fanciful term having no meaning in English language. TRADEMARKS [2] Evidence -- Of confusion (§ 67.337) Identity and similarity -- How determined -- In general (§ 67.4051) Infringement -- In general (§ 67.431) Infringement -- Knowledge or intent (§ 67.437) Pleading and practice in courts (§ 67.63) Court, in order to determine whether there is likelihood of confusion in trademark infringement case, must consider numerous factors, including strength or weakness of plaintiff's mark, degree of weakness of plaintiff's mark, degree of similarity between two products, competitive proximity of products, accused infringer's purpose in adopting its mark, actual confusion, and degree of care likely to be exercised by consumers; while each of factors is essential to determination of likelihood of confusion question, it is important that when applying these factors that court keep in mind that they are variable and that no single factor is determinative; they are variable and relative and no single one, because of its presence or absence is, in itself, determinative of case; rather, method of approach requires trial court to consider and weigh evidence relative to each of these points and such other points as it finds applicable in particular circumstances before it; then, from balancing of conclusions reached on all of these factors, it decides whether or not parties are entitled to relief or protection sought. Page 1 TRADEMARKS [3] Infringement -- In general (§ 67.431) Marks and names subject to ownership -- Descriptive -In general (§ 67.5071) Marks and names subject to ownership -- Descriptive -Misdescriptive or not descriptive -- Particular marks (§ 67.5078) "Squirt" is entitled to greater or broader degree of protection because of its strength than is weak or commonplace mark. TRADEMARKS [4] Identity and similarity -- How determined -Appearance, meaning or sound (§ 67.4055) Identity and similarity -- How determined -- Purchasers and selling methods (§ 67.4071) Both visual impression of trademark and sound of words are important when dealing with products such as soft drinks that are frequently sold in self-service grocery stores and supermarkets; "Squirt" and "Quirst" must be compared for similarity in appearance as well as in sound. TRADEMARKS [5] Identity and similarity -- How determined -- In general (§ 67.4051) Two marks should not be examined with microscope to detect minute differences, but, on contrary, should be viewed as whole. TRADEMARKS [6] Evidence -- Of confusion (§ 67.337) Fact that approximately 45% of entire sample specifically mentioned either similarity in sound between words "Squirt" and "Quirst," or similarity between names "Squirt" and "Quirst," without any prompting or suggestion whatsoever, is affirmative evidence of definite likeness between two marks as perceived by persons hearing two names together. TRADEMARKS [7] Class of goods -- Particular cases -- Similar (§ 67.2073) There is high degree of similarity between grapefruit flavored carbonated soft drink and lemonade flavored non-carbonated soft drink, both of which not only fall under general category of "soft drinks," but also under heading of "non-cola, fruit-flavored soft drinks." COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) TRADEMARKS [8] Identity and similarity -- How determined -Considering goods (§ 67.4057) Degree of similarity in trademarks necessary to support finding of infringement where products are virtually identical is less than in case of dissimilar, noncompeting products. TRADEMARKS [9] Class of goods -- How determined -- In general (§ 67.2031) Identity and similarity -- How determined -- In general (§ 67.4051) Identity and similarity -- How determined -- Purchasers and selling methods (§ 67.4071) Closeness of competition between two non-cola, fruit-flavored soft drinks is shown by identities that in some instances, they are being packaged by same bottler and/or being distributed by same distributor, two products are being offered for sale in common retail outlets, and, in fact, in at least one grocery store or supermarket, they were positioned on shelf next to one another, in marketing two soft drinks parties are making use of same vehicles for advertising, namely, television, radio, and newspaper, and "thirst-quenching" characteristics of soft drink is theme common to advertising of both of them, and both are packaged in convenient 12-ounce aluminum cans. TRADEMARKS [10] Evidence -- Of confusion (§ 67.337) Identity and similarity -- How determined -Considering other marks (§ 67.4059) Infringement -- Knowledge or intent (§ 67.437) Even though defendant was well aware of plaintiff's trademark when it chose its name and was cognizant of plaintiff's vigorous trademark protection policies prior to final decision to proceed with its mark, court cannot say that it was defendant's intent to pass their product off as being manufactured by plaintiff in case in which fact that defendant's product is defendant's is clearly spelled out on face of its product directly below its mark and that its survey commissioned prior to its mark selection indicated that accused mark had much stronger connotation than four other names it had selected for product -- a quality that it Page 2 held critical in its marketing strategy. TRADEMARKS [11] Infringement -- Knowledge or intent (§ 67.437) Indicator of alleged infringer's intent in selecting name is amount of money he intends to or has already spent on advertising and promotion of his product; when alleged infringer selects mark very similar to well established, well advertised mark that is held by plaintiff, and then attaches that mark to product very similar or virtually identical to product to which plaintiff's well established mark is attached, and does not spend any money or very little money in advertising his product, it is not unreasonable to infer that alleged infringer selected his mark with specific intent of profiting from plaintiff's reputation and advertising. TRADEMARKS [12] Evidence -- Of confusion (§ 67.337) Evidence of actual confusion is not essential to finding of trademark infringement; however, there can be no more positive proof of likelihood of confusion than evidence of actual confusion. TRADEMARKS [13] Evidence -- Of confusion (§ 67.337) Identity and similarity -- How determined -Appearance, meaning or sound (§ 67.4055) Episode in which individual mistook accused's television commercial for trademark owner's is evidence of definite likeness in sound that exists between two words. TRADEMARKS [14] Evidence -- Of confusion (§ 67.337) Court cannot say that results of survey in which actual purchaser is asked to list brands he has just purchased, and then asked to display brands he has named, in order to determine accuracy of his listed purchases demonstrate existence of actual confusion between products as in absence of any opportunity for surveyed party to be cross-examined it is not possible to determine reasons for three instances of plaintiff's mark being interchanged with defendant's; unavailability of cross-examination of three respondents is crucial fact that distinguishes Roto-Rooter Corp. v. O'Neal, 186 USPQ 73, from present case. COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) TRADEMARKS [15] Evidence -- Of confusion (§ 67.337) Fact that survey was conducted in live market environment and measured actual consumer purchasing behavior as opposed to being conducted in home and measuring consumer opinion, lends greater reliability to survey results; degree of attention of interviewee who is not in buying mood but is just in friendly mood answering pollster is quite different from that of interviewee who has his wallet in his hand; many men do not take same trouble to avoid confusion when they are responding to sociological investigators as when they spend their cash. TRADEMARKS [16] Evidence -- Of confusion (§ 67.337) Evidence that suggests that with respect to goods at issue there is definite interconnection between similarity of name and possible confusion supports theory that interchanges that occurred between two brands were result of similarity that exists between marks and not result of carelessness or inadvertence on respondent's part. TRADEMARKS [17] Evidence -- Of confusion (§ 67.337) Court cannot say that 4.3% (three out of seventy) level of error between plaintiff's and defendant's soft drink products is de minimus or statistically insignificant, when it is considered in context of entire soft drink industry; percentage of "likely confusion" required varies from case to case. TRADEMARKS [18] Evidence -- Of confusion (§ 67.337) Identity and similarity -- How determined -- Purchasers and selling methods (§ 67.4071) Survey offered in support of contention that likelihood of confusion exists between two marks applied to two soft drinks might well have been directed at general population instead of just women 25 years of age or older who had purchased any kind of soft drink on day of survey, as practical matter, since almost anyone would be likely to have purchased soft drinks at one time or another. TRADEMARKS [19] Evidence -- Of confusion (§ 67.337) Page 3 There is no problem with manner in which interview in which interviewers were instructed to record responses verbatim was conducted; fact that there was at least twenty percent verification of results in surveys conducted in two cities insures that interview was accurately recorded by interviewer. TRADEMARKS [20] Evidence -- Of confusion (§ 67.337) Identity and similarity -- How determined -Appearance, meaning or sound (§ 67.4055) Identity and similarity -- How determined -- Purchasers and selling methods (§ 67.4071) Visual impression of mark is very important when dealing with products that are frequently sold in self-service grocery stores because of fact that purchaser identifies and selects product through his sense of sight; some visual representation of two marks on such product, such as goods themselves or photographs of them, should be displayed to survey respondent so that visual comparison of two marks can be made. TRADEMARKS [21] Evidence -- Of confusion (§ 67.337) 34% and 23% of respondents in two surveys who said plaintiff's and defendant's soft drinks were put out by same company are not insubstantial percentages and are some evidence of likelihood of confusion. TRADEMARKS [22] Evidence -- Of confusion (§ 67.337) Identity and similarity -- How determined -Appearance, meaning or sound (§ 67.4055) It is significant that without any suggestion whatsoever approximately 25% (114/476) of entire sample cited as basis for their response to question as to whether survey respondent thought defendant's and plaintiff's soft drinks are put out by same or different companies a reason very closely related to either similarity between names or similarity between sounds of names or similarity in spelling of two names; this is evidence of definite likeness or similarity between marks as perceived by persons hearing two names together. TRADEMARKS COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) [23] Identity and similarity -- How determined -Considering goods (§ 67.4057) Identity and similarity -- How determined -- Purchasers and selling methods (§ 67.4071) Identity and similarity -- Words -- Similar (§ 67.4117) It is reasonable to infer that relatively low degree of care would be involved in purchase of two relatively low priced brands of soft drinks since soft drinks tend to be purchased on fairly frequent basis and thus be relatively routine type of purchase as result of low cost and relatively short product life after purchase, and grocery stores and supermarkets are primary retail outlet for soft drinks, purchases being made without assistance of any type of sales person and in environment not particularly conducive to slow, thoughtful, and deliberate purchasing process; this degree of care that might be exercised by purchaser cannot eliminate likelihood of confusion that might otherwise exist between "Squirt" and "Quirst"; in fact, because of relatively low degree of care likely to be exercised in purchase of "squirt" and "Quirst," it is fair inference that likelihood of confusion between two brands would be greater than with items in which relatively high degree of care might be exercised in connection with their purchase. TRADEMARKS [24] Identity and similarity -- Words -- Similar (§ 67.4117) "Quirst" for non-carbonated lemonade flavored soft drink is likely to cause confusion with "Squirt" for carbonated grapefruit flavored soft drink. *15 Action by The Squirt Company, against The Seven-Up Company and Seven-Up, U.S.A., Inc., for trademark infringement, dilution, and contract interference. Judgment for plaintiff. See also 207 USPQ 9. Armstrong, Teasdale, Kramer & Vaughan, and Frederick H. Mayer, both of St. Louis, Mo., and Price, Heneveld, Huizenga & Cooper, and Daniel Van Dyke, both of Grand Rapids, Mich., for plaintiff. Rogers, Eilers & Howell, John M. Howell, and Edmund C. Rogers, all of St. Louis, Mo., for defendants. Page 4 Harper, District Judge. This action was filed April 7, 1978, for alleged infringement and dilution of plaintiff's trademark rights and alleged tortious interference with plaintiff and its franchisee's contracts. Plaintiff, The Squirt Company, was organized under the laws of the State of California and maintains its principal place of business therein. The defendants are Missouri corporations, maintaining their principal places of business in Clayton, Missouri. The jurisdiction of this Court exists pursuant to 28 USC 1332 and 1338. Plaintiff filed a motion for a preliminary injunction requesting that defendants be restrained from: "1. Introducing, using, distributing, manufacturing, licensing and/or selling a soft drink or related product in connection with the trademark 'QUIRST' or any other confusingly mark similar thereto; and "2. Printing, reprinting, publishing, promoting, lending or distributing any advertisement or other material, whether written, audio or visually portrayed, which use or refer to the mark 'QUIRST' or any other mark confusingly similar to the mark 'SQUIRT' in connection with soft drink or related product." A hearing was held on the motion for a preliminary injunction and in a memorandum and order dated July 14, 1978, 207 USPQ 9, this Court denied plaintiff's motion for a preliminary injunction. In response to a motion filed by defendants, and joined in by plaintiff, this Court, pursuant to Rule 42(b) of the Federal Rules *16 of Civil Procedure, ordered that the issues of liability and damages be separated and that the trial relate only to the issue of liability. This cause of action came on for trial before this Court sitting without a jury on issues of liability only. The pleadings, stipulation of facts, credible testimony, and exhibits offered at the hearing of the motion for preliminary injunction and at the trial on the merits, disclose that on June 18, 1978, The Squirt Company amended its articles of COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) incorporation to change its name to Squirt-Co, the Certificate of Amendment having been filed with the Secretary of State of California on June 21, 1978. For the purpose of this memorandum, however, the plaintiff will still be referred to as The Squirt Company. The Squirt Company had duly registered and was the owner of the trademark SQUIRT in several classifications on the Principal Register in the United States Patent Office. The Squirt Company's registrations cover the word SQUIRT alone, and the word SQUIRT with accompanying words or designs. The Squirt Company is the duly registered owner of the following United States trademark registrations: Trademark Registration No. 367,659, registered May 23, 1939, for the trademark SQUIRT imposed on a splash design, on nonalcoholic grapefruit drink and bases and syrups and extracts for making the same (Plff's Ex. 1). Trademark Registration No. 388,777, registered July 8, 1941, for the trademark SQUIRT, on fresh citrus fruits and canned fruit juices for food purposes (Plff's Ex. 2). Trademark Registration No. 410,117, registered November 7, 1944, for the trademark SQUIRT, on nonalcoholic grapefruit drink and bases and syrups and extracts for making the same (Plff's Ex. 3). Trademark Registration No. 528,806, registered August 8, 1950, for the trademark SQUIRT, on nonalcoholic maltless beverages sold as soft drinks and bases and concentrates and syrups and extracts for making the same (Plff's Ex. 4). Trademark Registration No. 689,587, registered December 8, 1959, for the trademark SQUIRT on free form design on soft drink and bases for making the same (Plff's Ex. 5). Trademark Registration No. 748,123, registered April 16, 1963, for the trademark SQUIRT on free form design, on soft drinks and the bases and syrups for making the same (Plff's Ex. 6). Trademark Registration No. 771,971, registered June Page 5 23, 1964, for the trademark SQUIRT, on soft drinks and the bases and syrups for making the same (Plff's Ex. 7). The parties further stipulated that Squirt-Co is the owner of the SQUIRT trademarks and the goodwill associated therewith and the owner of U.S. Trademark Registration Nos. 367,659, 388,777, 410,177, 528,806, 689,587, 748,123 and 771,971. Finally, The Squirt Company asserts common law trademark rights in the phrase, "Never an After Thirst," through long and continuous use of such phrase as applied to soft drinks, syrups, extracts and mixes for marketing the same. Since 1937, The Squirt Company through its predecessors in business has been engaged in growing grapefruit and principally engaged in the business of producing and marketing grapefruit concentrate, bases, syrups and extracts for carbonated nonalcoholic soft drinks prepared in accordance with its proprietary specification and formula by franchise bottling, canning and selling agencies throughout the United States and abroad. In the field of production, The Squirt Company's primary business has been the manufacture of a soft drink base derived from fresh grapefruit. To be more specific, The Squirt Company first processes fresh grapefruit into grapefruit juice and then processes the juice into a grapefruit concentrate. From the concentrate is produced a soft drink base which is sold by The Squirt Company to SQUIRT franchise bottlers who utilize the soft drink base in the production of SQUIRT, a carbonated grapefruit flavored soft drink. In addition, through contract canners, The Squirt Company manufactures and sells to its franchised bottlers canned and bottled SQUIRT. A "contract canner" is a soft drink manufacturer that has canning lines, and under a standard arrangement The Squirt Company provides the canner with a certain inventory of the finished product SQUIRT, and for a fee the canner packages the product. After the SQUIRT is packaged, The Squirt Company sells it to its franchisees. At the time of this cause of action The Squirt Company has approximately 230 franchised bottlers. In addition to production, The Squirt Company has assumed an active role in the marketing of products bearing the COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) SQUIRT name. Pursuant to agreements with its franchised bottling and selling agencies, *17 The Squirt Company has engaged in extensive advertising on a national basis and also participates in certain local advertising programs for the purpose of publicizing and selling the beverage SQUIRT. Since the year 1940, The Squirt Company has expended approximately forty-five million dollars for advertising and sales promotion. The advertising undertaken by The Squirt Company has been in the form of point of purchase displays, as well as media advertising, including radio, television, outdoor posters, magazines and newspapers. Some of the slogans which have been employed by The Squirt Company in the marketing and advertising of the soft drink SQUIRT are as follows: 1. "Put a Little Squirt in Your Life." (Plff's Ex. 17) 2. "Our Secret Ingredient Grows on Grapefruit Trees." (Plff's Ex. 13) 3. "Switch to Squirt, Never an After Thirst." (Plff's Ex. 27) 4. "Squirt, The Soft Drink That Moonlights as a Mixer." (Plff's Ex. 13) 5. "Squirt, From the Land Where Thirst Comes Tall." (Plff's Ex. 51) 6. "Squirt Quenches Quicker." (Plff's Ex. 47) 7. "Switch from Sweet to Squirt." (Plff's Ex. 44) 8. "Squirt, From the Land Where Thirst Comes Big." (Plff's Ex. 52) 9. "Squirt, When You're Thirstier Than Usual." (Plff's Ex. 32) 10. "Smoother Together -- Squirt & Gordon's Vodka." (Plff's Ex. 23) Turning to the product itself, SQUIRT is a carbonated grapefruit base soft drink that is opaque in color. The ingredients of SQUIRT are as follows: Carbonated water, corn sweetener, grapefruit juice, citric acid, oil of grapefruit, and finally, benzoic acid. Page 6 SQUIRT brand drinks are sold not only in the United States, but are also sold in Canada, Mexico, Panama, Cost Rica, Bolivia, Luxembourg and Angola. The foreign sales represent approximately fifty percent of The Squirt Company sales. With respect to the retail distribution of SQUIRT in the United States, it is currently available for sale, at retail, in at least one market in some thirty-eight states. In terms of volume of sales, the principal retail outlet of the soft drink SQUIRT is the grocery store. However, the product is also offered for retail sale at package liquor stores, recreational facilities such as bowling alleys and golf courses, bars or taverns, and finally, in vending machines located at businesses such as service stations and motels, just to name a few. For the year 1977, the approximate total retail sales volume of the soft drink SQUIRT was $54,407.891.00. (Plff's Ex. 87.) Turning to the packaging of the soft drink SQUIRT, it is sold at retail in returnable bottles (ranging in size from 32 ounces to 7 ounces), non-returnable or "throwaway bottles" (ranging in size from 64 ounces to 7 ounces), and finally in twelve-ounce aluminum cans. In terms of volume of sales per year at the retail level, approximately 25 to 30 percent of SQUIRT sales are made in cans. The SQUIRT name was originally coined in the year 1937 by Citrus Club Products, Inc., of Phoenix, Arizona. Subsequently, the rights to the SQUIRT name were sold to The Squirt Company, a partnership which was incorporated under the laws of the State of California in 1946. The SQUIRT trademark was first registered by The Squirt Company on May 23, 1939, for use in "nonalcoholic grapefruit drink and bases, and syrups and extracts for making the same." Since the trademark SQUIRT was first registered by The Squirt Company in 1939, the Company has continuously used the SQUIRT trademark in identifying its grapefruit flavored soft drink, soft drink base, syrups and extracts. And in order to maintain the recognition and value of its SQUIRT trademark, The Squirt Company has maintained a vigilant trademark protection policy. This policy has been manifested in The Squirt Company's unquestioned COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) willingness to contest and oppose the registration of trademarks which misuse the SQUIRT trademark. The Seven-Up Company is a manufacturer of flavored extracts which it sells to others for the purpose of flavoring finished and packaged soft drinks which in turn are sold to the ultimate consumers. While The Seven-Up Company manufactures several different flavors, it is principally associated with the soft drink, SEVEN-UP, a carbonated lemon-lime drink. Seven-Up, U.S.A., Inc., is a wholly owned subsidiary of The Seven-Up Company, and is essentially the sales arm of The Seven-Up Company in the United States. The primary responsibility of Seven-Up, U.S.A., Inc., is the presentation to Seven-Up developers of the sales execution plans for Seven-Up Company products. The soft drink QUIRST is a ready to serve, non-carbonated Vitamin C enriched lemonade flavored drink which is slightly yellowish in color. The ingredients of *18 QUIRST are as follows: Water, sugar, citric acid, potassium sorbate, sodium benzoate, gum arabic, Vitamin C. glyceryl abietate, natural flavors, brominated vegetable oil and artificial color. The history of the lemonade drink QUIRST dates back to late fall of the year 1977, when the decision was made by William E. Winter, President and Chief Executive Officer of The Seven-Up Company for The Seven-Up Company to introduce a lemonade flavored soft drink to the market. While no target date was established for the lemonade soft drink being available on the retail market, Winter designated April 1, 1978, as a target date by which time the formulation and total marketing plan for the product would be completed. On or about May 8, 1978, The Seven-Up Company's lemonade flavored soft drink QUIRST was for the first time offered for sale at the retail level in and around Colorado Springs, Colorado. [1] The name QUIRST is a coined, fanciful term having no meaning in the English language. The exact origin of the word QUIRST is not known for certain. However, the evidence would suggest that the name originated with the advertising agency hired by The Seven-Up Company to work on the lemonade project. Allegedly, a Page 7 "brainstorming session" was held at the advertising agency with the purpose of the session being the generation of a "laundry list" of potential names for The Seven-Up Company's lemonade flavored soft drink. Out of this brainstorming session some 144 names were generated one of which being the name QUIRST. Suprisingly enough, no one at the advertising agency would step forward and take credit for creating the name QUIRST, and as a result the identity of the person who created it is not known. Nevertheless, it is apparent from the spelling of the term that the word "quirst" is a combination of the words "qu ench" and "th irst." As for the marketing of the soft drink QUIRST, "Thirst Quenching" was the central theme of The Seven-Up Company's advertising effort. QUIRST was to be positioned on the market as a "superior thirst quencher" to all other soft drinks and beverages. The objective of QUIRST advertising was to "create the belief that QUIRST is a great tasting lemonade drink that is superior to soft drinks and other beverages in its ability to quench thirst." (Plff's Ex. 103) The advertising objective is clearly manifested in the lyrics and slogans contained in a few of the QUIRST commercials and advertisements: 1. Newspaper Advertisement: "Try New Quirst for Thirst." (Plff's Ex. 108) 2. Promotional Folder: "Quirst Quenches." (Plff's Ex. 127) 3. Song Lyrics: "Whenever I want to quench my thirst * * * I feel likaQuirst * * * I feel lika Quirst." (Radio commercial.) (Plff's Ex. 331) Finally, the thirst-quenching advertising theme for the soft drink QUIRST was even reflected in the packaging design, as one of the design objectives of the can was to convey the image that the product is a superior thirst-quenching beverage to other beverage alternatives. In terms of advertising expenditures, the Executive Committee of The Seven-Up Company authorized between two million one hundred thousand and two million two hundred thousand dollars for advertising promotion of the soft drink QUIRST for the year 1978. It was the goal of the COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) Page 8 Company to test market QUIRST in about twenty percent of the United States in 1978. The proposed Media Plan for QUIRST called for television as the primary medium, with local market newspapers serving as a supportive medium (Plff's Ex. 166). The entire one million one hundred thousand dollars budgeted for the proposed Media Plan was to be expended in television and newspaper advertising running intermittently from the last week of May to the first week of September of 1978. The entire proposed Media Plan was to be funded by The Seven-Up Company. ready-to-drink form, QUIRST is available to consumers in the United States only in 12-ounce aluminum cans. At the time of this action QUIRST was being test marketed in the Phoenix, Arizona, market in the form of a powdered drink mix. And, at the time of this action The Seven-Up Company contended that it had made no commitment to introduce and distribute QUIRST in the United States in bottles. In addition to television and the newspaper, advertising for the soft drink QUIRST could be found in radio commercials, outdoor billboards, truck posters, store shelves (point of purchase displays), and finally, vending machine panels. "Any person who shall, without the consent of the registrant -- Turning to the distribution of QUIRST, The Seven-Up Company had a fairly rigid policy that it would not approach a developer for QUIRST distribution if the developer was already distributing another brand of lemonade. There were in fact two types of agreements used in the wholesale distribution of QUIRST. The first was a franchise agreement whereby the franchisee would buy the QUIRST concentrate from The Seven-Up Company, manufacture the finished product QUIRST from the QUIRST concentrate, package the product, and finally distribute it. The second type of agreement was a distributorship agreement under which Seven-Up Enterprises, a division of Seven-Up, U.S.A., Inc., would arrange for the production and packaging of *19 QUIRST, and then sell it to the distributor for distribution. As of on or about July 13, 1978, there were between sixty and seventy bottling plants which were under contract with The Seven-Up Company for the soft drink QUIRST by either a franchise agreement or a distributorship agreement. At the retail level there was evidence of QUIRST being available for retail sale in both grocery stores and supermarkets. And as for the location of the product in the store itself, all of the evidence showed QUIRST being positioned on the shelf next to, and in the aisle with, other soft drinks. Lastly, we turn to the packaging of QUIRST. In its finished, The basis for plaintiff's action is found in the Lanham Act, 15 USC 1114(1), which provides: "(a) use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive; * * * shall be liable in a civil action by the registrant for the remedies hereinafter provided." Section 45 of the Act, 15 USC 1127, reads in pertinent part as follows: "The term 'colorable imitation' includes any mark which so resembles a registered mark as to be likely to cause confusion or mistake or to deceive." In the contest of the present case the essential question to be answered is whether under all of the circumstances the trademark QUIRST on the label of a soft drink is similar enough to the SQUIRT trademark that its use is likely to cause confusion, mistake or deception of any kind. See Grotrian, Helfferich, Schulz, etc. v. Steinway & Sons, 365 F.Supp. 707, 712, 180 USPQ 506, 509-510 (S.D. N.Y. 1973); aff'd in relevant part, 523 F.2d 1331, 186 USPQ 436 (2nd Cir. 1975). [2] In order to determine whether there is a "likelihood of confusion" in a trademark infringement case such as this, the Court must consider numerous factors, including inter alia, the strength or weakness of the SQUIRT mark, the degree of weakness of the SQUIRT mark, the degree of COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) similarity between the two marks, the degree of similarity between the two products, the competitive proximity of the products, the alleged infringer's purpose in adopting its mark, actual confusion, and the degree of care likely to be exercised by consumers. See Grotrian, etc., supra, at 712, 180 USPQ at 509-510; Union Carbide Corp. v. Ever-Ready, Inc., 392 F.Supp. 280, 185 USPQ 464 (N.D. Ill. 1975); rev'd 531 F.2d 366, 81-82, 188 USPQ 623, 636-638 (7th Cir. 1976), cert. denied 429 U.S. 830, 191 USPQ 416 (1976). While each of the above factors is essential to a determination of the question of a likelihood of confusion, it is important that when applying these factors that the Court keep in mind that the factors are variable and that no single factor is determinative. As the Court pointed out in KiKi Undies Corp. v. Promenade Hosiery Mills, Inc., 411 F.2d 1097, 1099, 162 USPQ 67, 68- 69 (2nd Cir. 1969), cert. dismissed 396 U.S. 1054 (1970): "These factors are variable and relative and no single one, because of its presence or absence, is, in itself, determinative of a case. Rather, the method of approach requires the trial court to consider and weigh the evidence relative to each of these points and such other points as, in the particular circumstances before it, the court finds applicable; then, from a balancing of the conclusions reached on all of these factors, the court decides whether or not the parties are entitled to the relief or protection sought." We turn now to consideration of the relevant factors. In the case of E. I. DuPont de Nemours & Co. v. Yoshida International, Inc., 393 F.Supp. 502, 512, 185 USPQ 597, 604-605 (E.D.N.Y. 1975) the Court discussed the distinction between a "strong" and "weak" trademark: "Strength or weakness is primarily a question of assessment of a mark's distinctiveness or popularity. Where the public has been educated to recognize and accept a particular mark as the *20 hallmark for a particular source of that product, or the mark itself is inherently unique or has been the subject of wide advertisement, it is a strong trademark. Similarly, Page 9 coined or fanciful marks are generally thought to have a much more unique or distinctive appeal than words in common use, and are frequently found to be strong marks deserving a correspondingly broader degree of protection." (Citations omitted.) [3] In view of this Court's finding in its memorandum and order on plaintiff's motion for a preliminary injunction that the SQUIRT mark is both a distinctive and strong trademark, and that it is "fanciful and arbitrary as to soft drink products," there is little need for additional discussion of this factor. For purposes of this opinion it need only be said that because of the strength of the SQUIRT trademark it is entitled to a greater or broader degree of protection than is a weak or commonplace mark. See J. B. Williams Co., Inc. v. Le Conte Cosmetics, Inc., 523 F.2d 187, 192, 186 USPQ 317, 321 (9th Cir. 1975), cert. denied 424 U.S. 913, 188 USPQ 720 (1976); Grotrian, etc., supra at 713, 180 USPQ at 510-511. We next consider the degree of similarity between the marks. [4] When dealing with products such as SQUIRT and QUIRST which are frequently sold in self service grocery stores and supermarkets, both the visual impression of the trademark and the sound of the words are important. Spangler Candy Co. v. Crystal Pure Candy Co., 235 F.Supp. 18, 22, 143 USPQ 94, 97-98 (N.D. Ill. 1964), aff'd 353 F.2d 641, 147 USPQ 434 (7th Cir. 1965). For this reason, in determining the degree of similarity between the two marks, SQUIRT and QUIRST, they must be compared for similarity in appearance as well as of sound. David Sherman Corp. v. Heublein, Inc., 340 F.2d 377, 380, 144 USPQ 249, 251-252 (8th Cir. 1965). [5] It is well settled that in comparing the SQUIRT and QUIRST marks that "the two marks should not be examined with a microscope to detect minute differences, but, on the contrary, should be viewed as a whole." Syncromatic Corporation v. Eureka Williams Corporation, 174 F.2d 649, 650, 81 USPQ 434, 434-435 (7th Cir. 1949); cert. denied 338 U.S. 829, 83 USPQ 543 (1949). COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) A simple visual comparison of the words SQUIRT and QUIRST reveals a definite similarity in appearance. Both words are short, single words containing the identical letters, with the word "quirst" being formed from the word "squirt" by simply moving the "s" from its position at the beginning of "squirt" and repositioning it between the "r" and "t". Moreover, a comparison of the two trademarks as to form and coloring as they are displayed on the 12-ounce aluminum cans which are used in packaging the soft drinks discloses further similarity. First, both marks are printed in standard block letters. Second, only the first letter of both marks is capitalized, and thus it is larger in size than the remaining letters. Finally, both marks are printed on the side of the can with the letters ascending upward from left to right. Turning to the dissimilarities in appearance of the two marks, the most striking distinction is the fact that the first letter of the two marks is obviously not the same. In terms of the form and coloring of the two marks as they appear on a 12-ounce aluminum can, there are further dissimilarities. The word SQUIRT is printed in bright red letters, with a red "heart" dotting the "I", against the background of a bright yellow can. In contrast, the word QUIRST is printed in pale yellow letters, with a bright yellow lemon dotting the "I", against a dark green background, with a pale lime green colored can. A comparison of the phonetics of the two marks reveals a definite similarity in sound. The likeness of sound between SQUIRT and QUIRST is the result of the group of letters "quir" appearing in both words and the letter "t" being stationed at the end of each word. Perhaps the best evidence of the similarity of sound which exists between SQUIRT and QUIRST is found in the results of the "Chicago" survey commissioned by defendants. (Plff's Ex. 352) Page 10 shoppers were randomly stopped and asked a series of questions by the interviewer. For each respondent a questionnaire was filled out recording the respondent's answers to the respective questions. The questionnaires were then collected and the results tabulated. Turning to the questions asked in the Chicago survey, the first two questions were *21 directed to determining the respondent's brand awareness, both on an unaided and aided basis, of soft drinks and of cleaning disinfectants. In Question 3, four different radio commercials were played on a cassette recorder for the respondent. One of the commercials advertised SQUIRT, one advertised QUIRST, one advertised Lysol, and finally one advertised Kraft Blue Cheese. After all the commercials were played the respondent was asked to identify the product being advertised in the commercial. Following Question 3, the respondents were read the following statement as an introduction to Question 4: "Among the soft drinks on the market is a non-carbonated lemonade flavored soft drink called QUIRST. Another soft drink on the market is a carbonated grapefruit flavored soft drink called SQUIRT." This was followed by Question 4 which read: "Do you think SQUIRT and QUIRST are put out by the same company or by different companies?" After answering Question 4, the respondent was asked Question 4a: "What makes you think that?" The respondent's answer to Question 4a was to be recorded verbatim by the interviewer. In Question 5, the respondent was asked to identify, both on an unaided and aided basis, any brands of soft drink he or members of his family had purchased in the last year. Very briefly, and reserving until a later point in this memorandum a complete discussion of the mechanics of the Chicago survey, the procedure of the survey was as follows: The objective of the Chicago survey and the questionnaire was "to determine whether or not confusion existed in the minds of consumers as to the brand names SQUIRT and QUIRST; and if so, to what degree." (TTR p. 11) The Chicago survey was conducted in five different Zayre department stores located in and around the City of Chicago, Illinois, on July 20, 21 and 22 of 1978. It was conducted using the store intercept method in which store Before turning to the specific results of the Chicago survey two items merit mentioning. First, during the course of the interviews and the administration of the questionnaire, the respondents were shown no visual aids, such as a can of COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) QUIRST or SQUIRT, or a photograph of either of the products or even a card with the words SQUIRT and QUIRST written on it. The respondent's only exposure to either the SQUIRT mark or the QUIRST mark was by hearing it. A second important consideration is the fact that SQUIRT was available for sale in the Chicago area, but there had been little advertising undertaken promoting the product. And as for QUIRST, at the time the survey was taken it had never either been sold or advertised in the Chicago market, and thus it would be reasonable to assume that many of the respondents were hearing the name QUIRST for the first time. By virtue of the small amount of prior advertising of SQUIRT in Chicago and the complete absence of any QUIRST advertising at all, it is less likely that the survey responses were substantially affected by any conditioning effect which might result from recent exposure to SQUIRT or QUIRST advertising. (TTR p. 12) [6] A tabulation of the questionnaires in the Chicago survey revealed that out of a total of 152 respondents, 22 respondents, or approximately 15% of the sample, gave as a reason for their response in Question 4 the similarity or closeness in sound between the names SQUIRT and QUIRST. Moreover, an additional 46 respondents, or approximately 30% of the sample, cited as a reason for their answer in Question 4 the similarity or likeness between the names SQUIRT and QUIRST. In this Court's view, the fact that approximately 45% of the entire sample specifically mentioned either a similarity in sound between the words SQUIRT and QUIRST, without any prompting or suggestion whatsoever, is affirmative evidence of the definite likeness between the two marks as perceived by persons hearing the two names together. The importance of the existence of a similarity in sound between two marks is highlighted by the case of Grotrian, etc., supra at 1339-40, 186 USPQ at 442-443. In Grotrian, etc., the Second Circuit found that differences between the types used in printing the marks served to distinguish the marks from a visual standpoint. Yet in spite of the obvious visual distinctions, the Second Circuit sustained the district court's finding that auditory confusion is inevitable and thus that similarity of marks exist. Page 11 competitive proximity of the products. [7] For purposes of this trademark action, there is a high degree of similarity between the products. While SQUIRT is grapefruit flavored and carbonated in contrast to QUIRST which is lemonade flavored and non-carbonated, the fact remains that both marks are being applied to products which fall under the general category of "soft drinks". Moreover, the likeness between the products does not stop with the general category of "soft drinks", for both SQUIRT and QUIRST would fall under the heading of "non-cola, fruit-flavored soft drinks." In the case of Sweetarts v. Sunline, Inc., 380 F.2d 923, 927, 154 USPQ *22459, 462-463 (8th Cir. 1967), the Eighth Circuit in reversing the trial court and finding that the plaintiff's common law trademark had been infringed, emphasized the fact that both the infringed mark and the infringing mark were being applied to the same general class of product, candy, and overlooked the fact that the infringed mark was identifying candy of the "toffee and mixed chocolate variety", whereas the infringing mark was identifying a candy described by the court as "a small, brightly colored, powdery tablet with an artificial fruit flavoring." Id. at 926, 154 USPQ at 461. [8] Where products are virtually identical, as is the case here, the degree of similarity in trademarks necessary to support a finding of infringement is less than in a case of dissimilar, noncompeting products. See David Sherman Corporation, supra, at 382, 144 USPQ at 252-253 (8th Cir. 1965). [9] Turning to the competitive proximity of the products, there is no question but that SQUIRT and QUIRST compete on a direct basis for the same customers. The closeness of the competition between SQUIRT and QUIRST is shown by the following identities: (1) In some instances, SQUIRT and QUIRST are being packaged by the same bottler and/or being distributed by the same distributor. (2) The two products are being offered for sale in common retail outlets. In fact, in at least one grocery We next consider the degree of similarity between and the COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) store or supermarket, SQUIRT and QUIRST were positioned on the shelf next to one another. (3) In marketing QUIRST and SQUIRT the parties are making use of the same vehicles for advertising, namely, Television, Radio and Newspaper, just to name a few. (4) The "thirst-quenching" characteristics of the soft drink is a theme common to the advertising of both SQUIRT and QUIRST. (5) SQUIRT and QUIRST are both packaged in convenient 12-ounce aluminum cans. The Court turns now to consider the defendants' intent or purpose in adopting the QUIRST trademark. In the case of Fleischmann Distilling Corp. v. Maier Brewing Co., 314 F.2d 149, 157-58, 136 USPQ 508, 515-516 (9th Cir. 1963), cert. denied 374 U.S. 830, 137 USPQ 913 (1963), the plaintiff, a seller of Scotch Whiskey under the trademark "Black & White", brought an infringement action against the defendant who was marketing beer under the name "Black & White". In holding that the plaintiff's mark was infringed, the Court discussed the question of the defendant's intent and its relationship to the "likelihood of confusion" issue. The Court said: "It is well settled that plaintiffs were not obligated in order to make a case against the defendants to prove a wrong intent. Safeway Stores, Inc. v. Rudner, 9 Cir. 246 F.2d 826, 829, 114 USPQ 206, 208-209. But when the evidence does show or require the inference that another's name was adopted deliberately with a view to obtain some advantage from the good will, good name, and good trade which another has built up, then the inference of likelihood of confusion is readily drawn, for the very act of the adopter has indicated that he expects confusion and resultant profit." (Citations omitted.) [10] There is no question but that the Seven-Up Company was well aware of the SQUIRT trademark when it was decided to market their canned lemonade drink under the name QUIRST. Moreover, there is no doubt but that The Page 12 Seven-Up Company was cognizant of the plaintiff corporation's vigorous trademark protection policies prior to the final decision to proceed with QUIRST. Nevertheless, this Court cannot say that it was the intent of defendants to pass their lemonade drink off as being manufactured by plaintiff or that defendants selected the name QUIRST in the hope that the similarity in name would allow defendants to "trade off" or unfairly benefit by the excellence of plaintiff's product and good will. First of all, the fact that the lemonade drink QUIRST is the product of the Seven-Up Company is clearly spelled out on the face of the QUIRST can directly below the name QUIRST. Secondly, defendants presented a logical explanation for the selection of the name QUIRST. Prior to choosing a name for the canned lemonade product, The Seven-Up Company decided upon a marketing strategy in which the product would be positioned on the market as a "superior thirst quencher." On or around February 8, 1978, the Company, still undecided about a name for the canned lemonade drink, commissioned a "Canned Lemonade Name Study." (Plff's Ex. 144) Very briefly, the study was conducted in the cities of Philadelphia, Pennsylvania, and Miami, Florida, and consisted of personal *23 interviews of some 150 respondents selected via the "shopping center intercept method." The respondents were asked a series of questions, which were designed to determine which of five names -- Chug-A-Jug, Fresh Up, Quirst, Refresh, or Thirst Burst -- was the most compatible for the Seven-Up Company's new canned lemonade. In Question 5 of the survey the respondents were asked about their interpretation of each of the five names as applied to a "12-ounce canned lemonade product." For each of the five names the respondents were asked to answer the question: "What would the product name _________ mean to your?" The results to Question #5 indicated that approximately fifty-two percent of the respondents associated or evaluated the name QUIRST as meaning "thirst quenching". (Plff's Ex. 145) This percentage was viewed as significant, especially when compared with the percentages of the other four names, which were as follows: For "Fresh Up", 8% of the respondents, for "Refresh", 18% of the respondents, for "Thirst Burst", 31% of the respondents, and for COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) "Chug-A-Jug", 1% of the respondents, who evaluated the respective names as meaning "quenches thirst." The survey demonstrated that the name QUIRST has a much stronger thirst-quenching connotation associated with it than any of the four names surveyed. The ability of the name QUIRST to communicate the idea of "thirst-quenching" was critical in view of the Company's prior decision to position the product in the market as a "superior thirst quencher." This fact proved to be the determining consideration in the Company's decision to utilize the name QUIRST. [11] A further indicator of an alleged infringer's intent in selecting a name is the amount of money he intends to or has already spent on advertising and promotion of his product. When an alleged infringer selects a mark very similar to a well established, well advertised mark which is held by the plaintiff, and then attaches that mark to a product very similar or virtually identical to the product to which plaintiff's well established mark is attached, and doesn't spend any money or very little money in advertising his product, it is not unreasonable to infer that the alleged infringer selected his mark with the specific intent of profiting from plaintiff's reputation and advertising. See David Sherman Corp., supra. Such was not the case under the facts before this Court. Defendant, The Seven-Up Company, had budgeted between two million one hundred thousand and two million two hundred thousand dollars to be used for advertising and promotion of QUIRST for the year 1978. We next consider any evidence of actual confusion. [12] It is well settled that evidence of actual confusion is not essential to a finding of trademark infringement. David Sherman Corp., supra, at pp. 380-81, 144 USPQ at 251-252. However, "There can be no more positive proof of likelihood of confusion than evidence of actual confusion." Standard Oil Co. v. Standard Oil Co., 252 F.2d 65, 74, 116 USPQ 176, 182 (10th Cir. 1958). Plaintiff offered the deposition of Mrs. Nancy Moore, a sales clerk and housewife from Phoenix, Arizona, as being probative of an incident of actual confusion. Mrs. Moore testified that she had known her neighbors, Mr. and Mrs. George Julius, for a period of approximately seven months, Page 13 and that when she met Mr. Julius he was employed by a food company. Mrs. Moore stated that approximately one month prior to the taking of her deposition she had occasion to talk to Mrs. Julius, who informed her that Mr. Julius had accepted a position of employment elsewhere and that as a result they were in the process of selling their house and moving. Upon asking whether Mr. Julius was being transferred she was informed by Mrs. Julius that he had in fact taken a job with the Squirt Company. Mrs. Moore stated that although she knew there was a product like SQUIRT years ago, she could not recall it at the time of her conversation with Mrs. Julius, and thus she inquired as to what it was. Upon being informed by Mrs. Julius that "It's a fruit type soft drink", Mrs. Moore responded that she had seen the ads on television for the product. In reality the television ads to which Mrs. Moore was making reference were not advertisements for the product SQUIRT at all. Rather, the television advertisements to which Mrs. Moore was referring were commercials for the soft drink QUIRST, with an audio portion identical to that of Plaintiff's Exhibit 104. Plaintiff contends that actual confusion between the product advertised as QUIRST and the name SQUIRT was responsible for Mrs. Moore's mistake. Moreover, it is the contention of plaintiff that there can be no doubt but that the actual confusion was based upon the QUIRST advertisement, and not a SQUIRT ad, because of the testimony of Mr. Brooks that there had been no advertising conducted on behalf of the Squirt Company in the Phoenix area since early 1977. [13] *24 This Court has been cited no cases by plaintiff in which an occurrence similar to the one involving Mrs. Moore has been held to be direct evidence of actual confusion. Nevertheless, in this Court's view the aforementioned incident does demonstrate that some confusion was present in the mind of Mrs. Moore as to what she heard being advertised on television. It points up the possibility of consumers being unable to distinguish the names SQUIRT and QUIRST, especially when the names are heard in the context of a television or radio commercial. Without question, the episode of Mrs. Moore is further evidence of the definite likeness in sound which COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) exists between the words SQUIRT and QUIRST. Plaintiff asserts as a second example of actual confusion the results of the Maritz Survey commissioned by The Seven-Up Company. The designer of the Maritz Survey, Dr. Twedt, defined the purpose of the Maritz Survey as follows: "To conduct a controlled experiment, the purpose of which was to obtain factual information about measurable potential confusion between or among brands of soft drinks." (TTR p. 1430). We turn now to the methodology followed in the execution of the Maritz Survey. At three Low Cost Grocery Stores located in and around Phoenix, Arizona, a store intercept study was conducted on July 20, 21 and 22, 1978. During the three-day period in which the study or survey was conducted all three of the Low Cost Stores had the soft drinks, SQUIRT and QUIRST, available for sale at the reduced price of ninety-nine cents for a six-pack of 12-ounce cans. Upon entering the grocery store all customers were given a coupon worth fifty cents off the regular price of one six-pack of 12-ounce cans of any flavor of non-alcoholic beverage, with the exception of cola flavor. The primary purpose of the fifty-cent coupon was to stimulate the purchase of non-cola soft drinks and thus increase the efficiency of the three-day survey by having a large sample. After a customer had completed his shopping, gone through the check-out line, had his groceries bagged and was preparing to leave the store, he was intercepted by an interviewer and asked the following questions which were contained in a questionnaire: Question #1. "Did you get a coupon like this on your way into the grocery store?" (At the time of asking the question the interviewer displayed the fifty-cent off coupon described above.) If the answer to Question #1 was "Yes," the interview continued and the respondent was then asked: Question #2: "Did you use your coupon?" If the answer to Question #2 was "Yes," the interview continued and the following question was directed to the respondent: Question #3: "What brands of six-pack 12-ounce cans of non-alcoholic beverage other than cola Page 14 flavor did you buy?" The answers to Question #3 were recorded verbatim by the interviewer on the questionnaire. Following the recording of the responses to Question #3 the respondent was issued the following request: Question #4: "May I see the six-pack(s) of (each brand in the order mentioned in Question #3) you bought? I know it is an inconvenience to unpack your groceries so I will give you a $3.00 gift certificate good on any purchase of $3.00 or more at this store through July 30th if you will show me the six-pack(s) you bought." The interviewers were instructed to record verbatim the exact brands of 12- ounce canned, non-alcoholic beverages which were shown to them by the respondent. Finally, after recording the brands displayed, the interviewer directed the following question to the respondent: Question #5. "About how many bottles or cans of soft drinks would you say you have purchased in the past 30 days?" The answer to Question #5 was then recorded on the questionnaire. Following Question #5 the respondents were asked a series of demographic questions, which are unimportant for purposes of this action. It should be pointed out that to insure that the interviewer had no prior knowledge as to the soft drink purchases of the respondent, the interviewers were instructed to interview only those customers whose purchases of soft drinks were not outwardly visible to the interviewer. Thus, a customer whose soft drink purchases were sitting in plain view within the cart would not be interviewed. After the last demographic question was answered and the results recorded on the questionnaire, the respondent was thanked and the questionnaire containing his responses was retained by the interviewer so that the results might be tabulated. At this point a new interview was started with a new copy of the questionnaire. Following the completion of the entire survey a tabulation was made of the number of respondents who correctly identified the brand purchased and of respondents who *25 did not correctly identify the brands they had just previously purchased. COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) A compilation of the Maritz Survey results disclosed that a total of 1,016 persons were in fact interviewed. Of this total, some 884 persons answered "Yes" to Question #2 and thus used their fifty-cent coupon. Of the 884 persons who used their coupon, 839 responded to Question #3 by identifying the brands they purchased and then responded to Question #4 by displaying their beverage purchases to the interviewer. Of the total of 839, there were 70 persons who stated in answer to Question 3 the soft drink SQUIRT. Of the 70 persons who said they had SQUIRT, 65 in fact were able to display SQUIRT in response to Question #4. Three persons who said they had purchased SQUIRT, in fact had purchased QUIRST, while two persons of the total of 70 who said they purchased SQUIRT, in fact purchased the soft drink SPRITE. Thus, approximately 4.3% of the respondents, three out of the 70 who said they had purchased SQUIRT, when asked to display their purchases in fact had purchased QUIRST. There is no disagreement between the parties as to the questionnaire used, the procedure followed in executing the survey, or the procedure followed in compiling the results of the survey. However, the parties do not disagree as to the reliability or validity of the Maritz Survey results, and there is sharp disagreement between the parties as to the interpretation which should be accorded the results of the survey. It is the contention of the defendants that the Maritz Survey does not demonstrate actual confusion. Rather, defendants assert that the survey evidences the possibility of confusion between SQUIRT and QUIRST. Moreover, defendants contend that the 4.3% rate of possible confusion is statistically insignificant and de minimus. Plaintiff contends that the three instances in the Maritz Survey where the respondent said he purchased SQUIRT in answer to Question #3 but then displayed QUIRST in response to Question #4, demonstrate the existence of actual confusion on the part of the respondent. With respect to whether 4.3% is statistically significant, in Roto-Rooter Corporation v. O'Neal, 513 F.2d 44, 46, 186 USPQ 73, 74-75 (5th Cir. 1975), the district court had considered the testimony of four persons who had mistakenly employed defendants although intending to use the service of plaintiffs Page 15 as "not statistically significant," but in reversing the district court the Fifth Circuit stated: "[A]s this court said in World Carpets, [Inc. v. Dick Littrell's New World Carpets, 438 F.2d 482, 489, 168 USPQ 609, 614-615 (5th Cir. 1971)], 'reason tells us that * * * very little proof of actual confusion would be necessary to prove the likelihood of confusion."' As a starting point in this Court's evaluation of the Maritz Survey, we would point out that we know of no cases containing an actual market survey of the Maritz variety wherein an actual purchaser is asked to list the brands he has just purchased, and then asked to display the brands he has named, in order to determine the accuracy of his listed purchases. The cases which contain survey evidence that have been cited by the parties in their briefs are not of the Maritz type wherein consumer action or behavior is evaluated. Rather, the cases cited to this Court entail "opinion" type surveys, where typically a specific number of interviews are conducted either in a "purchasing" environment, such as a store or shopping center, or in a "non-purchasing" environment, such as the home or laboratory, and the respondent will be asked to express his or her opinion with respect to specific marks and whether they originate from the same source, or whether there is any relationship at all between two marks, etc. See E. I. DuPont de Nemours & Co. v. Yoshida International, Inc., supra; Union Carbide Corp. v. Ever-Ready, Inc., supra; Standard Oil Co. v. Standard Oil Co., supra at 75, 116 USPQ at 183; James Burrough Limited v. Sign of Beefeater, Inc., 540 F.2d 266, 277-78, 192 USPQ 555, 563-565 (7th Cir. 1976). [14] This Court cannot say that the results of the Maritz Survey demonstrate the existence of actual confusion between SQUIRT and QUIRST. It is unclear from the face of the survey whether the three instances wherein SQUIRT and QUIRST were interchanged was the result of carelessness or inadvertence on the one hand, or whether SQUIRT and QUIRST were interchanged as a result of the confusing similarity between the names on the other hand, or even some combination of the two extremes. In the absence of any opportunity for the surveyed party to be cross-examined it is not possible to determine the reasons for the three instances of QUIRST being interchanged with SQUIRT. The unavailability of COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) cross-examination of the three respondents who interchanged QUIRST with SQUIRT is the crucial fact which distinguishes Roto-Rooter Corp., supra, from the present case. In Roto-Rooter Corp. supra, the opportunity for cross-examination was present as to the four persons who had mistakenly *26 employed defendants although intending to use the services of plaintiffs. The cross-examination of the four persons cleared up any doubts as to the reason for their mistakenly employing defendant: "Cross-examination, rather than demonstrating carelessness or inadvertence, showed that the four persons had made their mistakes because of reliance upon the similarity of defendants' name to that of plaintiffs'." Id. at 46, 186 USPQ at 74-75. For these reasons this Court does not believe that the Maritz Survey results demonstrate the existence of actual confusion. [15] While unwilling to accept the Maritz Survey as evidence of actual confusion, this Court does believe that the results of the Maritz survey are strong evidence of a likelihood of confusion between SQUIRT and QUIRST. First of all, the fact that the survey was conducted in a live market environment and measured actual consumer purchasing behavior as opposed to being conducted in the home and measuring consumer opinion, lends greater reliability to the survey results. As Judge Wyzanski pointed out in American Luggage Works v. United States Trunk Co., Inc., 158 F.Supp. 50, 116 USPQ 188 (Mass.1957); aff'd 259 F.2d 69, 118 USPQ 424 (1st Cir. 1958), at page 53, 116 USPQ at page 190-191: "If the interviewee is not in a buying mood but is just in a friendly mood answering a pollster, his degree of attention is quite different from what it would be had he his wallet in his hand. Many men do not take the same trouble to avoid confusion when they are responding to sociological investigators as when they spend their cash." [16] Secondly, evidence which would support the theory that the interchanges which occurred between SQUIRT and QUIRST were the result of the similarity which exists between the marks and not the result of carelessness or Page 16 inadvertence on the part of the respondent, is found in Exhibit E(4) wherein the survey data has been compiled. Looking at the chart found on page 6, with but two exceptions all of the incidents of "possible" confusion involved either brands with virtually identical names, such as Dr. Pepper being confused with Sugar Free Dr. Pepper and vice versa, Sugar Free Seven-Up being confused with Seven-Up, Sugar Free Sprite being confused with Sprite, and Sugar Free Shasta being confused with Shasta; or the "possible confusion" involving five brands with at least some similarity in name, those being Squirt, Quirst, Sprite, Shasta and Seven-Up. In other words, the incorrect identifications were very highly concentrated in brands with either virtually identical names or names wherein some likeness existed. This result would suggest that with respect to non-cola, non-alcoholic beverages, there is a definite interconnection between similarity of name and "possible confusion." [17] Lastly, this Court cannot say that the 4.3% (three out of seventy) level of error between SQUIRT and QUIRST is de minimus or statistically insignificant, when it is considered in the context of the entire soft drink industry. While the percentage of "likely confusion" required will vary from case to case, in Grotrian, etc., supra, at 716, the district court determined a survey to be strong evidence of the likelihood of confusion in which 7.7% of the respondents perceived a business connection between the alleged infringing company and the plaintiff company, and 8.5% of the respondents confused the two names. In addition to the Maritz Survey, plaintiff offers two other surveys in support of its contention that a likelihood of confusion exists between the SQUIRT and QUIRST marks. More specifically, plaintiff commissioned two related surveys which this Court will refer to as the Chicago Survey and the Phoenix Survey. Turning to the procedures followed in executing the two surveys, this Court has already discussed in a fair amount of detail the Chicago Survey. For this reason we direct our attention to the Phoenix Survey. The Phoenix Survey was conducted in eight different COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) Safeway and Fed-Mart supermarkets in and around the City of Phoenix, Arizona, on July 20, 21 and 22, 1978. The Phoenix area was selected as the site of the survey because it represented a market wherein both SQUIRT and QUIRST were available for sale. The survey was administered using the store intercept method in which "qualified respondents", that is, any woman 25 years of age and older, who had purchased soft drinks that day, were randomly stopped and asked a series of questions by the interviewer. For each respondent interviewed a questionnaire was filled out recording the respondent's answers to the respective questions. At the conclusion of the survey the questionnaires were collected and the results tabulated. Turning to the questions which made up the Phoenix Survey Questionnaire (Plff's Ex. 353), the first question was directed toward determining the respondent's brand awareness of soft drinks, both on an unaided *27 and aided basis. Both SQUIRT and QUIRST were included in the "aided" list of brands. Upon completion of Question 1, Question 2 was directed to the respondent, which read: "I noticed you purchased soft drinks today. Without looking at what you purchased * * * what brands of soft drink did you purchase?" Following Question #2, the identical question to Question #4 of the Chicago Survey was directed to the respondent: "Among the soft drinks on the market is a non-carbonated, lemonade flavored soft drink called QUIRST. Another soft drink on the market is a carbonated, grapefruit flavored soft drink called SQUIRT." This was followed by 2a, which read: "Do you think SQUIRT and QUIRST are put out by the same company or by different companies?" After the respondent answered Question #2a he was asked Question #2b: "What makes you think that? The interviewer was to record the respondent's answer to Question #2b verbatim. Finally, in Question #3 the respondent was asked to identify any brands of soft drink that he or members of his family had purchased in the last year, both on an unaided and aided basis. Page 17 It was the objective of the Phoenix Survey to determine whether or not confusion existed in the minds of purchasers of soft drinks as to the names SQUIRT and QUIRST, and if so, to what degree. In the case of American Luggage Works, supra, at 54, 116 USPQ at 191, the court offered the following observations with respect to the evaluation of survey evidence: "In every case where the results of a poll or similar survey are offered, there arise as preliminary problems the propriety of the universe, the choice of the sample, the qualifications of the experts and investigators, the manner of interviewing, the questions asked by the investigators, and the scope of freedom of the interviewee to frame an answer in his own terms." Before examining the Phoenix and Chicago Surveys, it must be pointed out that the parties made the following stipulation: "It is stipulated that the interviewees who conducted the field survey work as the same relates to the surveys to be relied upon by the parties followed instructions and were competent. This stipulation is based upon mutual representations by counsel that the interviewees were not advised for whom the survey was being taken." [18] Because of the similarities between the Chicago and Phoenix Surveys, this Court will examine the two surveys together. In the Chicago Survey, "Qualified Respondents" were any women 25 years of age or older who was shopping in the store on the day of the survey. In the Phoenix Survey, "Qualified Respondents" were limited to any women 25 years of age or older who had also purchased any kind of soft drink on the day of the survey. In our view, both surveys were directed at suitable universes, with the Phoenix Survey universe perhaps being more appropriate since the person interviewed was definitely a purchaser of soft drinks. As a pactical matter, since almost anyone would be likely to have purchased soft drinks at one time or another, both surveys might well have been directed at the general population. See Union Carbide Corp., supra, at 388, 188 USPQ at 643-644. COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) As for the process of selecting the individual respondents, in both surveys respondents were selected in a random fashion. The first woman 25 years of age or older to approach the interviewer (In Phoenix the woman had to have purchased soft drinks on the day of the survey in addition to being a woman 25 years of age or older) was confronted and interviewed face to face. As soon as that interview was completed, the very next respondent who approached was interviewed. Thus, the first qualified respondent to approach an interviewer after the completion of the preceding interview was the criteria for selecting respondents. [19] Both the Chicago and Phoenix Surveys were conducted under the direction of the firm of Britt and Frerichs, Inc., a well known marketing research firm in Chicago, Illinois. The questionnaire utilized in the Phoenix Survey, as well as the questionnaire utilized in the Chicago Survey, were developed by Dr. Steuart Britt, a founder of the firm, and John Bunge, Manager of Administration and Operations for the firm. Both men are indeed qualified as experts in the area of Marketing Research. There would appear to be no problem with the manner in which the interviews were conducted in either survey, as the interviewers were instructed to record the responses verbatim. Moreover, the questions contained in both the Chicago questionnaire and the Phoenix questionnaire were neither slanted nor leading. There were no restrictions placed upon the respondent insofar as stating his reasons for a particular response when called upon to defend his answer. Finally, there was at least a twenty percent verification of *28 the results in both the Chicago and the Phoenix Surveys. This insures that the interview was accurately recorded by the interviewer. Turning to the results of the Chicago and Phoenix Surveys, we would begin by pointing out that a total of 152 interviews were conducted in Chicago and that a total of 476 interviews were conducted in Phoenix. In Chicago, 51 persons said that SQUIRT and QUIRST were put out by the same company, or 34% of the sample; 84 persons said that SQUIRT and QUIRST were put out by different companies, or 55% of the sample; and 17 persons didn't know whether SQUIRT and QUIRST are put out by the same or different companies, or 11% of the sample. In Phoenix, 110 persons Page 18 said that SQUIRT and QUIRST are put out by the same company, or 23% of the sample; 161 persons said that SQUIRT and QUIRST are put out by different companies, or 34% of the sample; and 205 persons didn't know if SQUIRT and QUIRST are put out by the same or by different companies, or 43f the sample. In other trademark infringement cases surveys similar to plaintiff's Chicago and Phoenix surveys have been held to be of probative value in the Court's finding that a likelihood of confusion existed. See LaMaur, Inc. v. Revlon, Inc., 245 F.Supp. 839, 146 USPQ 654 (D. Minn. 1965); Seven-Up Co. v. Green Mill Beverage Co., 191 F.Supp. 32, 128 USPQ 284 (N.D. Ill. 1961); James Burrough LTD v. Sign of Beefeater, supra; Standard Oil Co. v. Standard Oil Co., supra. Before discussing the results of the Phoenix and Chicago surveys this Court would offer the following observation with respect to the mechanics of the surveys. First off, it is generally thought that in evaluating surveys that any technical deficiencies ought to go to the weight accorded them and not to their admissibility in evidence. See La Maur, Inc. v. Revlon, supra, at 842, 146 USPQ at 655-656. This Court's criticism of the Chicago and Phoenix Surveys is grounded upon the following statement by the Court in Spangler Candy Co. v. Crystal Pure Candy Co., supra, at 22, 143 USPQ at 97-98: "When products are sold by name over a counter the sound of the name is important. (Citations omitted.) When products are sold in self service markets, then the visual impression of the trademark as well as the sound of the words is important." [20] It is well established by the evidence that self service grocery stores and supermarkets represent the largest retailer of the soft drink SQUIRT in terms of total volume of sales per year. As pointed out by the Court in Spangler, supra, when dealing with products such as SQUIRT which are frequently sold in self service grocery stores, the visual impression of the mark is very important because of the fact that the purchaser identifies and selects the product through his sense of sight. In both the COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) Chicago and Phoenix surveys the respondents were shown no visual aids whatsoever, thus precluding any sort of visual comparison of the SQUIRT and QUIRST marks. In this Court's view some visual representation of the two marks, such as a can of SQUIRT and a can of QUIRST, or a photograph of the two cans, should have been displayed to the respondent so that a visual comparison of the two marks could be made. As it was, in both surveys the respondent's only exposure to the two marks was by hearing them. Turning to the results of the Chicago and Phoenix surveys, we would begin by noting that the percentage of respondents who said SQUIRT and QUIRST were put out by the same company (Chicago 34%, Phoenix 23%), is comparable and in some cases higher than those held sufficient in other cases to support in part an inference that confusion is likely. James Burrough LTD v. Sign of Beefeater, Inc., supra (15%); Jockey International, Inc. v. Burkard, 185 USPQ 201 (S.D. Cal. 1975), (11.4%); Seven-Up Company v. Green Mill Beverage Co., supra (25%); Humble Oil & Refining Co. v. American Oil Co., 259 F.Supp. 559, 151 USPQ 266 (E.D. Mo. 1966) (18%), aff'd 405 F.2d 803, 160 USPQ 289 (8th Cir. 1969), cert. denied 395 U.S. 905, 161 USPQ 832. [21] In this court's view, the not insubstantial percentages of respondents who mistakenly connected the soft drinks SQUIRT and QUIRST as being "put out by the same company" is some evidence of a likelihood of confusion, deception, or mistake regarding the source or origin of the soft drink QUIRST. This Court would offer this final observation with respect to the Phoenix survey alone, having already made in essence the same observation in regard to the Chicago survey. The results of the Phoenix survey disclose that out of a total of 110 respondents who answered Question 2a with the response "same company", 61 persons gave as a reason for that answer a response which would fall in one of the four following categories which were established by the author of the survey (TTR p. 64): *29 Response Categories: 01 Just the names/Names similar/Names alike. Page 19 02 Sound the same/ "Qu" sound in both/ Sound alike/ Sound similar. 03 They are almost alike/ Similar/Same idea. 04 Letters in names/Switched letters. Of the 161 respondents of the Phoenix Survey who responded to Question #2a with the response "different companies", 53 persons gave as a reason for such answer a response which would fall into at least one of the following categories which were established by the author of the survey (TTR pp. 66-67): Response Categories: 01 Names same/Similar/Confusing. 02 Names sound similar/Too similar. 03 Too much alike to be put out by the same company/Too confusing. 04 Same company would similar/Identical/Confusing. not have names so 05 Spelled almost same/Changed letters around. [22] Disregarding the respondents' answer to Question #2a for the moment, this Court believes it significant that without any suggestion whatsoever approximately 25% (114/476) of the entire sample cited as a basis for their response to Question #2a a reason very closely related to either the similarity between the names or the similarity between the sounds of the names or the similarity in the spelling of the names SQUIRT and QUIRST. This is but further evidence of the definite likeness or similarity between the marks as perceived by persons hearing the two names together. Finally, we turn to consider the degree of care likely to be exercised by consumers in the purchase of products such as SQUIRT and QUIRST. In the case of Grotrian, Helfferich, Schulz, etc. v. Steinway & Sons, supra, at 1342, 186 USPQ at 445, the Court stated: "We recognize that in a trademark infringement action COPR. © 2006 The Bureau of National Affairs, Inc. 207 U.S.P.Q. 12 FOR EDUCATIONAL USE ONLY 1979 WL 25027 (E.D.Mo.), 207 U.S.P.Q. 12 (Cite as: 207 U.S.P.Q. 12) the kind of product, its cost and the conditions of purchase are important factors in considering whether the degree of care exercised by the purchaser can eliminate the likelihood of confusion which would otherwise exist." [23] In the present case we are dealing with two brands of soft drink, the price of which are relatively low. As a result of the low cost and relatively short product life after purchase, soft drinks would tend to be purchased on a fairly frequent basis and thus be a relatively routine type of purchase. Grocery stores and supermarkets are the primary retail outlet for soft drinks, the purchases being made without the assistance of any type of sales person and in an environment not particularly conducive to a slow, thoughtful and deliberate purchasing process. For these reasons this Court believes that it is reasonable to infer that a relatively low degree of care would be involved in the purchase of SQUIRT and QUIRST. Moreover, we do not believe that this degree of care which might be exercised by the purchaser can eliminate the likelihood of confusion which might otherwise exist between SQUIRT and QUIRST. In fact, because of the relatively "low" degree of care likely to be exercised in the purchase of SQUIRT and QUIRST it is a fair inference that the likelihood of confusion between SQUIRT and QUIRST would be greater than with items wherein a relatively "high" degree of care might be exercised in connection with their purchase. See American Chicle Co. v. Topps Chewing Gum, Inc., 208 F.2d 560, 563, 99 USPQ 362, (2nd Cir. 1953); RJR Foods, Inc. v. White Rock Corp., Case No. 77 Civ. 2329, 201 USPQ 578 (S.D. N.Y. 1978), attached to plaintiff's post trial brief. Page 20 SQUIRT trademarks because the name QUIRST is likely to cause confusion, mistake or deception. This memorandum opinion will be adopted by the Court as its findings of fact and conclusions of law with respect to the question of liability, and the attorneys for the plaintiff will prepare the proper order to be entered by the Court, first submitting same to the attorneys for the defendants for approval as to form, and then to the Court for entry. E.D.Mo. 207 U.S.P.Q. 12 END OF DOCUMENT [24] In summary, the presence of the strong and distinctive SQUIRT trademark, the extensive similarity between the SQUIRT and QUIRST mark, the close competitive proximity and similarity between the products, the low to moderate degree of care likely to be exercised by purchasers of soft drinks, and the Maritz, Chicago and Phoenix Surveys, are all signs of a likelihood of confusion. These considerations lead us to the conclusion that the defendants are infringing the plaintiff's COPR. © 2006 The Bureau of National Affairs, Inc.
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