USCA1 Opinion
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
____________________
No. 95-1926
CHRYSLER CORPORATION,
Plaintiff, Appellant,
v.
JOHN C. SILVA, JR., d/b/a J.C. SILVA DESIGNS,
Defendant, Appellee,
_____________________
No. 95-1927
CHRYSLER CORPORATION,
Plaintiff, Appellee,
v.
JOHN C. SILVA, JR., d/b/a J.C. SILVA DESIGNS,
Defendant, Appellant,
_____________________
No. 96-1231
CHRYSLER CORPORATION,
Plaintiff, Appellant,
v.
JOHN C. SILVA, JR., d/b/a J.C. SILVA DESIGNS,
Defendant, Appellee.
____________________
____________________
APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Edward F. Harrington, U.S. District Judge]
____________________
Before
Cyr, Circuit Judge,
Aldrich and Campbell, Senior Circuit Judges.
____________________
Jerre B. Swann with whom Kilpatrick & Cody, Robert B. Cultice,
Goldstein
&
Manello,
Eric
M. Dobrusin, and Harness, Dickey & Pierce were
on brief for Chrysler Corporation.
Anthony M. Fredella with whom Fredella & Wheeler was on brief for
John C. Silva, Jr.
____________________
July 9, 1997
____________________
ALDRICH, Senior Circuit Judge. This is an unusual
case
that
goes
back
a
long while, including a four year history
prior to suit. Plaintiff Chrysler Corporation ("Chrysler")
filed suit in the Massachusetts District Court in July 1991,
under
the
Lanham Act, 15 U.S.C. SS 1051 et seq., for trademark
infringement,
specifically trade dress, against John C. Silva,
Jr.
("Silva"), and a number of other individual defendants who
have settled out. At issue was Chrysler's allegation that
Silva copied Chrysler's innovative "muscle car," the Dodge
Viper. Silva counter-claimed, alleging that the shoe was on
the other foot; that Chrysler was the one at fault, having
stolen
the
allegedly
infringed design from him. On December 9,
1993 the court, in a separate brief memorandum, ordered
summary judgment for Chrysler on the counter-claim on the
ground of estoppel.1
The
first
of
Chrysler's
demands was for a preliminary
injunction
against
violation. This was denied, and ultimately,
after a bench trial, the court dismissed Chrysler's complaint
with
a
memorandum
of
findings. This was initially done on July
19,
1995.
On
August
4
Chrysler moved to amend the findings and
to alter or amend the judgment, or, alternatively, for a new
trial. The court took additional testimony and on January 9,
1996
it
again entered judgment for defendant on the complaint.
Both parties appealed. We affirm in part.
1. This went to judgment on December 14, 1995.
-3-
Just prior to oral argument before us, Silva died.
At
the
argument
date
his
(former) counsel appeared, saying that
he had no client. On his stating that his argument was ready
we said we would hear the oral arguments of both sides and
reproduce
them for the files. This has been done. We further
stated that we would afford time for an administrator to be
appointed for Silva and move to continue the case, if so
minded. This, too, has been done. One Jeanne A. Silva,
temporary administratrix of the estate of John C. Silva, Jr.,
has
been
substituted for the deceased Silva in all capacities.
We continue with the appeals.
I. Facts
It is, of course, well known that there is enormous
competition that depends upon the body appearance of
automobiles.
It
is
not
so well known that this is so important
to true enthusiasts that custom builders make, or order made,
special
bodies to place over a standard chassis. This art can
produce problems. See, e.g., Ferrari S.P.A. Esercizio v.
Roberts, 944 F.2d 1235, 1244-45 (6th Cir. 1991).
In 1988, spurred on by a conversation between its
executives the previous year, Chrysler considered designs
harking back, in part, to 1960's roadsters. A prototype was
completed
in
time
for
the January 1989 International Automobile
Show
in
Detroit. Here the reception was so good that Chrysler
formed TEAM VIPER. By December 1991, it had four production
-4-
units and in 1992 it produced 200 Vipers. It had spent
approximately $8,000,000 to promote this vehicle and over
$75,000,000 to bring it into production. It attracted a
special class of buyers.
During the trial, as a defense to the infringement
claim, Silva testified that he had contacted Chrysler by mail
in October 1987 and offered it the opportunity either to
purchase
his
design for a car Silva had dubbed the "Mongoose,"
for
which
he
included sketches with his letter, or to contract
with him to build a show car based on the design. He claimed
that past experience in building cars for large manufacturers
instilled in him the necessity of clearly marking the designs
with proprietary statements of ownership and confidentiality
before
forwarding
them
to Chrysler. He also included a request
that the sketches be returned if Chrysler was not interested.
He
received
no
response
to his letter and the sketches were not
returned.
In early 1989, Ronald Torlone, one of the original
defendants, decided he wanted a "new look" for his 1979
Chevrolet Corvette. For this he retained a builder, Motor
Incorporated, for which Silva worked as an independent
contractor. They and another original defendant, Richard
Galardi,
produced the Mongoose.2 Also in 1989, after seeing a
2. The single Mongoose is currently in the hands of Chrysler
who received it from another original defendant, Leonard
Legere, who purchased it from Richard Galardi who received it
-5-
picture of Chrysler's prototype for the Viper, Silva called
Chrysler and eventually spoke with an in-house attorney who,
after learning of the Mongoose, demanded that Silva stop work
and
destroy
the vehicle. Silva refused, Chrysler brought this
suit and Silva counterclaimed for the theft of his design.
II. Analysis
Section
43(a)
of
the
Lanham Act, 15 U.S.C. S 1125(a),
provides protection against:
(1) Any person who, on or in
connection with any goods or services, or
any container for goods, uses in commerce
any word, term, name, symbol, or device,
or any combination thereof, or any false
designation
of origin, false or misleading
description of fact, or false or
misleading representation of fact, which
--
(A) is likely to cause confusion, or
to cause mistake, or to deceive as to the
affiliation,
connection, or association of
such person with another person, or as to
the origin, sponsorship, or approval of
his or her goods, services, or commercial
activities by another person . . . .
15 U.S.C. S 1125(a).
In
1992,
the
Supreme
Court held that S 43(a) extended
to
claims
for infringement of trade dress. Two Pesos, Inc. v.
Taco Cabana, Inc., 505 U.S. 763, 770 (1992). Trade dress has
been defined as "the design and appearance of [a] product
from Ronald Torlone in satisfaction of amounts due in return
for Galardi's construction of the mechanicals for the car.
While Chrysler has possession of the Mongoose apparently as
part of a consent decree with Legere, Galardi retains title
to the vehicle because Legere defaulted on his payments.
-6-
together with the elements making up the overall image that
serves to identify the product presented to the consumer."
Fun-Dametal Too, Ltd. v. Gemmy Indus., 111 F.3d 993, 999 (2d
Cir. 1997) (internal citation omitted). In order to warrant
protection, trade dress must be either inherently distinctive
or
have
become
so
by
acquiring a secondary meaning. Two Pesos,
505
U.S.
at
769. Inherently distinctive trade dress cannot be
functional, and to prevail on a claim of infringement, the
defendant's
product
must
have created a likelihood of confusion
with
regard
to its source. See id.; Tec Eng'g Corp. v. Budget
Molders Supply, Inc., 82 F.3d 542, 545 (1st Cir. 1996).
The
court
found
that
the
Viper "had acquired inherent
distinctiveness
through
secondary meaning, that the trade dress
was 'non-functional,'" and therefore entitled to trade dress
protection,
but
that
Chrysler failed to prove the likelihood of
confusion between the two cars. It made several individual
findings of fact. Relevant ones include:
11. Mr. Silva saw and/or read the press
coverage of the Viper concept car in the
Spring and Summer of 1989.
* * *
13.
Photographs of the Dodge Viper concept
car served as the starting point for the
car body designed by Mr. Silva for Mr.
Torlone.
14. Mr. Silva made significant
modifications to the design of the Dodge
Viper in his creation of the car body,
including, but not limited to: the
windshield; the rollbar; the nose area;
-7-
the wrap-around area of the mirrors; and
the cut lines.
15. Mr. Silva did not intend to duplicate
or otherwise copy the Dodge Viper.
With these findings in hand, the court moved to the
test
for
likelihood of confusion, consisting of eight relevant
factors, see Aktiebolaget Electrolux v. Armatron Int'l, Inc.,
999 F.2d 1, 3 (1st Cir. 1993); Boston Athletic Ass'n v.
Sullivan
,
867 F.2d 22, 29 (1st Cir. 1989), and determined that
each party was entitled to prevail on four, as follows:
1. Similarity of the marks (dress) -
Chrysler
2. Similarity of goods - Chrysler
3. Channel of trade - Silva
4. Channel of advertising - Silva
5. Class of prospective purchaser -
Silva
6. Evidence of actual confusion -
Chrysler
7. Defendant's intent in adopting the
dress - Silva
8. Strength of the dress - Chrysler.
On this basis, unless Silva prevails because of his
lack of bad intent in adopting Chrysler's dress, it is
difficult to understand why Chrysler, who prevailed here on
similarity
and strength of dress, should lose its case, it not
being necessary, since the Lanham Act's amendment, to prove
purchaser confusion, post. Beyond this seeming inconsistency
-8-
it is hard to explain how the court could say, "[T]he Court
rules, as a matter of law, that plaintiff did not establish a
likelihood of confusion between its vehicle and the Silva
vehicle." (emphasis supplied.) If the court meant matter of
law, it was clearly wrong. There were ample lay witnesses,
notably the other original defendants, expressly mentioned by
the
court,
whose evidence precluded ruling as a matter of law
in Silva's favor.
Study
of
its
opinion as a whole leads us to conclude
that
the
court really meant "find," or "conclude," and we will
so address its decision. Chrysler says, as it must,
Aktiebolaget
Electrolux
,
that such a finding was plainly wrong.
A
substantial part of the court's opinion is devoted
to listed factors 3, 4 & 5, ante, concluding that purchasers
would not be confused or misled. Chrysler concedes this;
indeed it offered no evidence to the contrary.3 Rather, its
case
depends
on
what
is
known as post-sale confusion -- viewers
who have an interest from the standpoint of the original
creator's reputation and may be misled. Chrysler introduced
persuasive
evidence
that
the Viper added greatly to its general
reputation, quite apart from sales. Infringers who do a poor
3. We devote a footnote to the court's giving weight to its
finding that Silva did not intend to copy. Strictly, intent,
or lack thereof, does not affect the eyes of the viewer. See
Lois Sportswear, U.S.A. v. Levi Strauss & Co., 799 F.2d 867,
875 (2d Cir. 1986). Proof of bad intent may,
psychologically, hurt as an admission. Proof of good intent
does not change appearance.
-9-
job
mechanically,
or
introduce differences that detract, but do
not
change
the apparent origin, were recognized by Congress in
enlarging the statute. See Roberts, 944 F.2d at 1244-45. In
disregard of Fed. R. Civ. P. 52(a), this confusion was not
mentioned, let alone discussed by the court, although it was
part of Chrysler's main case and was adequately supported by
expert
testimony.4 We see no possible fair resolution of this
basic
inadequacy
short
of giving Chrysler a whole new trial, to
be
before
a
new judge because of the extensive interlocking of
the evidence.
This brings us to Silva's temporary Administratrix
entering the case to pursue the appeal from the summary
judgment disposing of the counterclaim for taking Silva's
design.
If
Silva's
testimony of significant variances by which
the Mongoose departed from the Viper is correct, and on which
the court ultimately relied, it is hard to see how Chrysler
pirated
the
Mongoose's
design. While a party's pleading may be
inconsistent, in the last analysis one cannot have it both
ways. The court was impressed by Silva's submission and
pretrial evidence contrary to the counterclaim, committing
himself to inconsistencies, and held him estopped5.
4. The court did give some attention to Chrysler's expert
during trial. "I was . . . not paying too much attention to
the cross-examination, but the last question was a good one,
it woke me up."
5. The district court found in relevant part:
-10-
We are not moved by Silva's explanations;
particularly
not by the use he made of the fact that initially
he was without counsel, and we are much troubled by his
charging Chrysler with making "an especially egregious
misstatement
of fact" in saying his answers to interrogatories
were under oath when they were unsigned. Silva fails to
mention
that
in
his
deposition, obviously under oath, he agreed
to their correctness.
The judgment dismissing the complaint is reversed;
Chrysler
to
have
a
new
trial. The judgment for Chrysler on the
counterclaim
is
affirmed, with leave to the succeeding judge to
reconsider if so minded. Costs to Chrysler.
Defendant Silva repeatedly made
judicial admissions negating his
misappropriation counterclaim, and, thus,
is estopped from raising said claim at
this time. The Defendant Silva
repeatedly conceded in pleadings and
other papers filed with this Court that
his vehicle is "significantly different"
than the Viper and was based on design
elements in the public domain.
-11-
