United States District Court, D. Kansas
MEMORANDUM AND ORDER
JULIE
A. ROBINSON CHIEF UNITED STATES DISTRICT JUDGE.
This
matter is before the Court on Jenny Yoo Collection Inc.'s
(“JY”) Motion for Reconsideration (Doc. 76) of
the Court's April 8, 2019 Memorandum and Order dismissing
JY's claims for trade dress infringement in violation of
the Lanham Act (Count I) and trade dress infringement and
unfair competition under New York common law (Count
II).[1]
The motion is fully briefed, and the Court is prepared to
rule. For the reasons set forth below, the Court
grants JY's motion and reconsiders
dismissal of Counts I and II of JY's Amended Complaint.
I.
Procedural and Factual Background
The
Court assumes the reader is familiar with both the order of
dismissal that precipitates the matter before the Court and
the procedural history of this case.[2] The Court reiterates the
relevant facts from JY's Amended Complaint as needed to
frame its discussion of the present matter.
In its
Amended Complaint, JY expanded the description of the
allegedly infringed trade dress to:
JY's trade dress, as shown in the drawings herein below,
includes, as a special feature, front and back panels of
fabric that overlay the full length of the skirt ending just
above the bottom hemline. The panels are stitched into the
waist seam and naturally hang down the skirt of the dress.
The panels seamlessly blend with the dress, regardless of
whether the panels are hanging in their natural position or
raised over the bodice to create the different configurations
of the dress. When the panels are in the hanging position as
an overlay of the skirt, they layer over the full length of
the entire skirt and seamlessly blend with the natural and
gentle soft folds, creating the illusion, unique when
introduced by JY, that the panels and skirt are integrated.
Furthermore, if the wearer chooses to style the dress into
alternate necklines by raising one or more of the panels
upwards and over the bodice into different configurations of
the dress, the panels once again seamlessly blend into the
bodice of the dress. This creates the illusion that the
panels smoothly blend uninterrupted into the bodice, skirt
and/or entire dress to create a singular, integrated look.
The concept of “seamless blending” means that
from the point of view of an ordinary observer, it will be
noticeable that the dress contains front and back panels
separate from other components of the dress, which when
integrated into the dress create looks that are smooth and
continuous, with no apparent gaps or spaces between one part
or the next, and without seams or obvious joins. Thus, while
the front and rear panels are noticeable to the ordinary
observer as distinct components of the dress, nonetheless,
they create the impression of an integrated, natural,
elegant, unified dress design. This ornamental,
non-functional special feature as described above has become
JY's renowned Trade Dress (the “JY Trade
Dress”), instantly recognizable among consumers and
industry professionals alike as being associated with
JY.[3]
JY
identified the alleged distinct components of its trade
dress, explaining:
The character and scope of the JY Trade Dress is that the
dresses are made of lightweight material with: (i) a
strapless upper garment (bodice) portion with a sweetheart
shape neckline covering an area above the waist of the user
having a front and rear portion; (ii) a skirt having a front
and rear portion attached to the upper garment (bodice); and
(iii) two front and rear panels that overlay the full length
of the skirt ending just above the bottom
hemline.[4]
JY also
identified the third component as “two front panels and
two rear panels with a natural soft drape that seamlessly
blend with the dress regardless of whether the panels are
hanging in their natural position or raised over the bodice
to create the different configurations of the
dress.”[5] Additionally, JY included twelve
individual sketches showing the different configurations of
the dresses containing the trade dress, as well as
side-by-side photograph comparisons between its dresses and
Essense's allegedly infringing products.[6]
JY
claims that it revolutionized the bridal gown industry in
2012 when it introduced its “Aidan” and
“Annabelle” convertible bridesmaid dress designs,
which embody its alleged trade dress.[7] JY has sold over 132, 000 of
these dresses, resulting in over $30 million in
revenue.[8] It claims “[r]eviewers, analysts and
consumers immediately recognized the convertible dress as a
‘game changer, '” because prior versions of
convertible dresses “were bulky, awkward and
utilitarian, requiring that conversions be made by tying
together components of the dress in different and often
unattractive configurations.”[9] The JY convertible dress
design was “radically different” in that
[i]t provided for use of lightweight material with two rear
and two front convertible panels attached at the waist seam
that blended seamlessly into the design of the bottom part of
the dress, and could be easily raised by hand and rearranged
for purposes of converting the dress into different neckline
styles and inherently attractive, elegant
looks.[10]
JY
references this “unique-indeed, revolutionary
ornamental feature that has become famous” throughout
its Amended Complaint.[11] Additionally, JY alleges that various
media outlets have promoted and recognized its convertible
bridesmaid dress design.[12]
II.
Legal Standard
Under
D. Kan. Rule 7.3(a), “[p]arties seeking reconsideration
of dispositive orders or judgments must file a motion
pursuant to Fed.R.Civ.P. 59(e) or 60” to alter or amend
the judgment. Grounds which justify alteration or amendment
under Rule 59(e) include: (1) an intervening change in
controlling law; (2) new evidence that was previously
unavailable; or (3) a need to correct clear error or prevent
manifest injustice.[13] Plaintiff asserts that reconsideration
is warranted under the third prong.
The
decision to grant or deny a motion for reconsideration is
within the Court's discretion.[14] A court will grant
reconsideration when the “court has misapprehended the
facts, a party's position, or the controlling
law.”[15] A motion for reconsideration, however,
is not an opportunity to “revisit issues already
addressed or advance arguments that could have been raised in
prior briefing.”[16]
III.
Discussion
JY
argues that dismissing its Lanham Act and New York common law
trade dress infringement claims on a motion to dismiss was
clear error and resulted in manifest injustice. Specifically,
JY asserts that the Court erred by: (1) basing its analysis
upon a single component of JY's trade dress; (2)
determining that JY's allegation of “seamless
blending” was unclear on a motion to dismiss; (3)
focusing only on JY's verbal description of its trade
dress; and (4) conflicting with other courts' decisions
that JY has sufficiently alleged its trade dress. When boiled
down, these arguments rely on the same premise-that the Court
incorrectly applied the standard for deciding a motion to
dismiss by prematurely determining whether JY has a legally
cognizable trade dress. As the requirements to plead trade
dress infringement under New York common law mirror those
under the Lanham Act, the Court considers JY's arguments
as relating to both claims.[17]
A.
Manifest Injustice
JY
argues that it will suffer manifest injustice by
“losing claims against Essense based upon JY's
valuable rights that it has in its Trade Dress that other
Courts have refused to dismiss.”[18] As an initial
matter, this assertion is inaccurate. As discussed below,
this Court's dismissal of JY's trade dress claims
does not conflict with other courts' decisions. Further,
“[w]here reconsideration is sought to prevent manifest
injustice, the moving party can only prevail if he
demonstrates injustice that is
‘indisputable.'”[19] “[A] manifest
injustice does not result merely because a harm may go
unremedied.”[20] Here, JY does not demonstrate how
denying reconsideration results in “indisputable”
injustice; rather, its alleged injustice is merely a
potentially unremedied harm.[21] Accordingly, the Court finds
that manifest injustice does not provide a reason to
reconsider dismissing JY's trade dress infringement
claims. Thus, the Court considers whether dismissing the
trade dress infringement claims constituted clear error.
B.
Other Courts' Decisions on JY's Trade Dress
Allegations
JY
argues that the Court should reconsider dismissal of its
trade dress infringement claims because it conflicts with
other district courts' determinations that JY has
sufficiently alleged trade dress claims.
First,
JY asserts that this Court's decision to dismiss its
trade dress infringement claims is inconsistent with the
Northern District of Texas' decision in Jenny Yoo
Collection, Inc. v. Watters Designs, Inc. (the
“Texas Lawsuit”).[22] The Court is aware of the
Texas Lawsuit, as made clear by its reference to the Texas
Lawsuit in the Memorandum and Order dismissing JY's trade
dress claims.[23] The Texas court allowed JY to amend its
complaint to explain the meaning of “seamless
blending” on the basis of its allegation that
“seamless blending” was a term of art and to
clarify what its trade dress covered “beyond two front
panels and two rear panels attached to the
waist.”[24] JY requests “[a]t a minimum . . .
that the Court allow JY to amend its pleadings in accordance
with the Texas District Court's
decision.”[25] The Court already allowed JY to amend
its complaint, [26] which is clear as this motion for
reconsideration is before the Court on its dismissal of
claims in JY's Amended Complaint. Furthermore,
as this Court mentioned in dismissing the trade dress claims,
the defendants in the Texas Lawsuit also filed a second
motion to dismiss after JY amended its complaint. The Texas
court has not decided this motion, however, because the
parties reached a settlement after its filing.[27]
JY
additionally cites its new case filed in the Southern
District of New York against David's Bridal, Inc.
(“DBI”), alleging trade dress and trademark
infringement claims, as well as claims based on breach of a
settlement agreement.[28] Specifically, JY points the Court to
a transcript where the Southern District of New York gave its
impressions on DBI's pre-motion letter seeking permission
to file a motion to dismiss.[29] The Court finds the transcript
inapplicable to JY's present motion for reconsideration.
The transcript cited by JY is from a hearing on April 18,
2019-ten days after this Court dismissed JY's trade dress
claims. Moreover, the Southern District of New York was not
deciding a motion to dismiss, and no motion to dismiss had
even been filed.[30] As an initial reaction to DBI's
pre-motion letter, the Southern District of New York stated,
as to the issue of the articulation of specific elements
comprising the trade dress, that “[DBI] up to this
point has not pointed out particular deficiencies in
plaintiff's iteration of the elements of the trade dress
that are applicable here, and so my impression at this
point is that [DBI's] argument on that point is
likely to fail.”[31] This statement-not found in a court
order and not being binding authority on this Court-does not
support the proposition that this Court should reconsider its
dismissal of JY's trade dress claims because it conflicts
with other courts' decisions.
C.
Articulation of a Trade Dress
As an
initial matter, JY asserts that the Court erred by not
considering the drawings and photographs included in its
Amended Complaint. The Court did consider JY's visual
depictions of its trade dress as embodied by its
“Aidan” and “Annabelle” convertible
dress designs, however, and explicitly stated
“[a]lthough JY includes drawings and photographs of the
designs, these do not alleviate the deficiencies of JY's
trade dress descriptions.”[32] Further, the Court found
that JY's verbal articulation could not comprise a
legally cognizable trade dress because its description of
“seamless blending” required a determination of
quality, beauty or cachet, which precluded a finding of a
protectable trade dress. Importantly, Yeti Coolers, LLC
v. Magnum Solace, LLC-relied on by JY-explained that
“photographs alone are insufficient to provide notice
of the elements of an alleged trade
dress.”[33] Therefore, the Court finds that JY's
inclusion of drawings and photographs encompassing the
alleged trade dress does not relieve JY of the requirement of
articulating its trade dress allegations.
JY
additionally argues that the Court erred by dismissing
JY's trade dress infringement claims based on its
description of “seamless blending” being vague
and contradictory and relying on a determination of beauty,
quality or cachet.[34] Specifically, JY argues that the Court
focused too much on a single component of its alleged trade
dress-“seamless blending”-and “improperly
ignored other alleged components of JY's Trade Dress and
improperly disregarded the total look of JY's Trade
Dress.”[35] As an initial matter, this argument
conflicts with JY's treatment of “seamless
blending” in its pleadings. JY references and describes
“seamless blending” throughout its Amended
Complaint;[36] in opposing Essense's motion to
dismiss, JY did not explicitly argue the impropriety of
considering “seamless blending” allegations; and
in its motion for reconsideration, JY now states “[t]he
whole point is that the panels seamlessly blend no matter
what configuration the dress is worn in.”[37] Many
allegations describing JY's alleged trade dress-mainly
those related to “seamless blending”-appear to
require a determination of beauty, quality or cachet-(1)
“[t]he panels have a natural soft drape;” (2)
“seamlessly blend with the natural and gentle soft
folds;” (3) “looks that are smooth and
continuous, with no apparent gaps or spaces between one part
or the next, and without seams or obvious joints;” and
(4) “integrated, natural, elegant, unified dress
design.”[38] Similarly, the allegations appear to
contain contradictory phrases such as “[t]he concept of
‘seamless blending' means that from the point of
view of an ordinary observer, it will be noticeable that the
dress contains front and back panels separate from other
components of the dress, which when integrated into the dress
create looks that are smooth and continuous . . .
.”[39]
Nevertheless,
in its motion for reconsideration, JY directs the Court to
cases indicating the error of deciding on a motion to dismiss
that these allegations preclude JY from asserting a trade
dress infringement claim. This Court would be remiss not to
consider authority that indicates error in dismissing
JY's trade dress claims for failure to specifically
articulate its trade dress on a motion to dismiss. “A
complaint is neither an injunction nor a judgment; it merely
puts the defendant on notice of the plaintiff's
claims.”[40] As JY now articulates, with citation to
relevant case law, [41] determining whether a trade dress is
identified in a complaint requires the Court to consider
whether the allegations, taken as true, provide notice of the
alleged trade dress, not whether the trade dress is described
with the requisite specificity to grant relief.[42]
Applying
the standard that “the plaintiff's burden at the
motion to dismiss stage was to put the defendant on notice of
the claims against it, and that there was no requirement that
the plaintiff plead its trade dress with further specificity,
”[43] the United States District Court for the
Eastern District of Michigan found that a plaintiff's
allegations, which included “photographs of [the
plaintiff's] and [the defendant's products], as well
as product numbers, sufficiently put [the defendant] on
notice of the individual trade dress infringement claims
against it.”[44] Although the plaintiff would
“eventually be expected to list, in detail, the
elements of the trade dresses it seeks to protect, ”
the court found that at the motion to dismiss stage,
“the lingual and pictorial allegations in the complaint
[were] sufficient to survive [defendant's]
motion.”[45] JY additionally points to other cases
where the visual depictions of the alleged trade dress-when
combined with identification and visuals of the alleged
infringing products-placed the defendant on notice of the
trade dress.[46] Essense does not direct the Court to law
contrary to JY's assertion that at a motion to dismiss
stage its pleadings must simply provide notice of its alleged
trade dress and can do so through a combination of visual and
linguistic descriptions.[47] Instead, Essense relies on its
argument that JY has not clearly articulated a trade dress
because the descriptions of “seamless blending”
are contradictory and require a determination of
beauty.[48]
The
Court finds that it misapprehended JY's arguments for why
it has sufficiently alleged a trade dress at the motion to
dismiss stage. Specifically, the Court finds error in
dismissing JY's trade dress infringement claims without
consideration of whether its Amended Complaint provided
Essense notice of the alleged trade dress. In its Complaint,
JY alleges that
[t]he character and scope of the JY Trade Dress is that the
dresses are made of lightweight material with (i) a strapless
upper garment (bodice) portion with a sweetheart neckline
covering an area above the waist of the user having a front
and rear portion; (ii) a skirt having a front and rear
portion attached to the upper garment (bodice); and (iii) two
front panels and two rear panels that overlay the full length
of the skirt ending just above the bottom
hemline.[49]
JY
further alleges that the front and rear panels are a special
feature that “overlay the full length of the skirt . .
. are stitched into the waist seam and naturally hang down
the skirt of the dress.”[50]While other allegations of
JY's purported trade dress-those describing
“seamless blending”- appear to be contradictory
and require a determination of beauty, the other articulated
components of JY's trade dress are sufficient to place
Essense on notice of what JY claims as its trade dress. JY
also provides side-by-side images of its and Essense's
convertible bridesmaid dresses containing the alleged trade
dress, as well as sketches and product numbers of JY's
dresses containing the alleged trade dress. When combined
with the non-contradictory and non-fanciful allegations,
these allegations provide Essense notice of JY's alleged
trade dress. Thus, JY's descriptions of “seamless
blending” do not prevent the Court from finding, on a
motion to dismiss, that JY has plausibly pled a protected
trade dress. To the extent the components of JY's trade
dress result in “seamless blending, ” the
determination of the meaning of “seamless
blending” is best left to summary judgment, where JY
will be required to show that it is not contradictory and
does not require analyses of beauty.[51] While the Court now finds
that JY's pleadings place Essense on notice of its trade
dress, as the litigation continues, the Court will require JY
to clearly and specifically articulate its alleged trade
dress in a legally cognizable manner-with non-contradictory
language that does not rely on a determination of beauty,
quality or cachet.[52]
D.
Trade Dress Infringement Allegations
As the
Court finds that JY's allegations adequately place
Essense on notice of the trade dress it seeks to protect, on
reconsideration, the Court now considers whether JY has
pleaded trade dress infringement under the Lanham Act and New
York common law.[53] To prevail on a trade dress infringement
claim, a plaintiff must show: “(1) The trade dress is
inherently distinctive or has become distinctive through
secondary meaning; (2) There is a likelihood of confusion
among consumers as to the source of the competing products;
and (3) The trade dress is
nonfunctional.”[54] The parties do not dispute whether JY
has alleged a likelihood of confusion, and rather, they
disagree whether JY has alleged that the trade dress is
nonfunctional and has developed secondary meaning.
1.
Nonfunctional
The
Supreme Court has promulgated two tests for determining the
functionality of a trade dress. First, under the
“traditional” test, the United States Supreme
Court has explained that a “‘product feature is
functional,' and cannot serve as a trademark, ‘if
it is essential to the use or purpose of the article or if it
affects the cost or quality of the
article.'”[55] Second, under the “competitive
necessity” test, a product feature is functional if it
“is one the ‘exclusive use of [which] would put
competitors at a significant non-reputation-related
disadvantage.'”[56] The party asserting trade
dress infringement bears the burden of demonstrating that the
trade dress is nonfunctional.[57]
In its
motion to dismiss JY's Amended Complaint, Essense asserts
similar arguments to those it made in its first motion to
dismiss as to why JY's alleged trade dress is functional.
Summarily, Essense argues that because the four panels allow
the bridesmaid dresses to be converted into various
configurations, they are essential to the use or purpose of
the dresses and thus ineligible for trade dress protection.
As explained in this Court's August 2018 Memorandum and
Order declining to dismiss JY's trade dress infringement
claims because of functionality, the Northern District of
Texas addressed the same issue and concluded it was at least
plausible that the overall placement of the four panels in
relation to the bridesmaid dress identify JY as the
manufacturer and distinguish the dress from those of JY's
competitors.[58]
As the
Texas court noted, courts must examine the functionality of
the trade dress as a whole.[59] Like the defendants in the
Texas Lawsuit, Essense focuses on individual elements of
JY's trade dress, ignoring that “a particular
combination of functional elements may be protected if
configured in an ‘arbitrary, fanciful, or distinctive
fashion.'”[60] The Texas court found that under the
“competitive necessity test, ” it is plausible
that “there are sufficient alternative designs
available to [JY's] competitors, i.e., convertible
dresses that do not use the four panels arranged at the front
and back of the waist, such that granting [JY] exclusive use
of the trade dress would not put competitors at a significant
non-reputation-related disadvantage.”[61] As the Texas
court further found, “because a design patent is
granted only for non-functional designs, it can serve as
evidence that a plaintiff's trade dress is
nonfunctional.”[62] Finally, the Texas court addressed JY
having pending utility patent applications covering elements
of the alleged trade dress.[63]Although a utility patent is
“strong evidence that the [elements] therein claimed
are functional, ”[64] pending applications do not bar a
plaintiff, as a matter of law, from asserting the trade dress
claim.[65] Accordingly, the Court again finds it
plausible that JY's trade dress is nonfunctional.
2.
Secondary Meaning
In
addition to being nonfunctional, a trade dress must either be
inherently distinctive or have secondary
meaning.[66] As product design cannot be inherently
distinctive, in a product design case, a plaintiff must show
that the alleged trade dress has developed secondary
meaning.[67] A trade dress acquires secondary meaning
“when, ‘in the minds of the public, the primary
significance of a [mark] is to identify the source of the
product rather than the product
itself.'”[68] A plaintiff asserting a trade dress
claim may establish secondary meaning ...