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In a “reverse confusion” trademark case, a federal judge in Philadelphia ruled that Victoria’s Secret Stores Inc. must abandon its use of the “Miracle Bra” trademark for its line of bust-enhancing swimwear because the products were likely to be confused with the “MiracleSuit,” a line of bathing suits manufactured by A&H Sportswear Co. that is designed to make the wearer look slimmer. The ruling does not affect Victoria’s Secret’s use of the trademark “Miracle Bra” in selling lingerie. But U.S. District Judge Franklin S. Van Antwerpen also held that A&H is not entitled to any monetary award because Victoria’s Secret never acted in bad faith and A&H can’t show that it lost any sales. In fact, the judge said, the reverse confusion may have enhanced sales of the MiracleSuit. In a reverse confusion case, the plaintiff claims that its trademark is being infringed by a larger company whose use of a similar mark could lead consumers to believe that the smaller company is somehow connected to the larger company, resulting in a loss of corporate identity. Van Antwerpen’s latest ruling comes after more than seven years of litigation and two trips to the U.S. Court of Appeals, both of which resulted in significant opinions that changed trademark law in the 3rd U.S. Circuit Court of Appeals. In the first appellate decision, an en banc panel of the 3rd Circuit reversed Van Antwerpen’s decision to award A&H more than $1.1 million, saying his ruling was premised on a finding of a “possibility” of confusion. A hearing by the full appeals court was required because the decision overturned prior 3rd Circuit decisions that seemed to allow for a possibility-of-confusion standard. On remand, Van Antwerpen faced another quandary since the 3rd Circuit’s case law seemed to have a gap. While the court offered a 10-part test in Interpace Corp. v. Lapp Inc. for deciding whether consumers would be confused by similar trademarks used for non-competing products, there was no test for competing products. Van Antwerpen created his own test — a modified version of the Lapp factors — and concluded that Victoria’s Secret had cured any defect by adding a disclaimer to its product tags and catalogs that said its Miracle Bra bathing suit was not associated with the MiracleSuit. He also found that the constant use of its “housemark” — the Victoria’s Secret name — helped distinguish the two products. But on the reverse-confusion claim, Van Antwerpen found that A&H wasn’t even entitled to have a Lapp-like test applied since it was unable to show “economic disparity.” The 3rd Circuit again reversed, finding that the Lapp test changes considerably when applied in the reverse-confusion context and that Van Antwerpen erred in holding that economic disparity is a threshold hurdle that a plaintiff must clear before proceeding with such a claim. Now Van Antwerpen has ruled that A&H proved its reverse confusion claim, and that a full injunction — barring Victoria’s Secret from using any term that includes the word “Miracle” in marketing its swimwear — was the only way to cure the reverse confusion problem. “We find that A&H has a strong interest to be protected, namely control of its corporate identity, ability to expand into new markets, and protection of its goodwill and reputation. While these interests perhaps are not as strong as protecting against the diversion of sales and infliction of financial harm, the control over its highly successful MiracleSuit mark and the goodwill and reputation associated with the mark is obviously very important to A&H,” Van Antwerpen wrote. According to court papers, A&H manufactures about 10 percent of swimsuits made in the United States. In 1992, it received a federal trademark for use of the MiracleSuit mark for swimwear. Victoria’s Secret and its catalogue company have sold women’s lingerie under the Miracle Bra mark since 1993, but didn’t get a trademark until 1994, the same year that it introduced a line of Miracle Bra swimwear. After A&H filed suit, Victoria’s Secret began using disclaimer tags on its swimwear to advise consumers that they had no connection to the MiracleSuit. The Patent and Trademark Office later denied Victoria’s Secret’s request for trademark registration to use the Miracle Bra mark on swimwear. In his latest ruling, Van Antwerpen addressed the remedy that A&H is entitled to after proving its reverse confusion claim. A&H’s lawyers — Arlin Adams of Philadelphia-based Schnader Harrison Segal & Lewis, and Norman Seidel of Laub Seidel Cohen & Hof in Easton, Pa. — argued that A&H is entitled to a share of Victoria’s Secret’s profits from the swimwear line. But Van Antwerpen found that A&H isn’t entitled to any monetary damages. “As there is no indication of any lost profits or any other actual pecuniary damage suffered by plaintiffs as a result of the reverse confusion, we find that it is impossible to award monetary relief based on a theory of damage to the plaintiffs,” Van Antwerpen wrote. A&H argued that Victoria’s Secret’s use of the Miracle Bra mark on swimwear was a willful infringement because it deliberately chose the name and knew of the existence of the MiracleSuit mark. Van Antwerpen disagreed, saying “we think that plaintiffs have misapplied the term ‘willful’ in the trademark context.” Knowing or willful infringement, he said, “consists of more than the accidental encroachment of another’s rights. It involves an intent to infringe or a deliberate disregard of a mark holder’s rights.” Van Antwerpen found that Victoria’s Secret did not deliberately infringe on the MiracleSuit mark. “Our finding of a likelihood of reverse confusion did not occur until Aug. 17, 2001, after seven years, two trials, hundreds of exhibits, extensive briefing, and numerous district court and appellate opinions. To say that Victoria’s Secret acted in bad faith for not coming to this same legal conclusion in 1994 borders on the absurd. Counsel need not be prescient,” Van Antwerpen wrote. Instead, Van Antwerpen said, the decision to extend the Miracle Bra mark into swimwear “was a good faith attempt to capitalize on defendants’ own success in a new product line.” But on the question of the injunction, Van Antwerpen sided with A&H, saying the factors outlined by the 3rd Circuit showed that the reverse confusion could not be cured without completely barring Victoria’s Secret from using the term “Miracle” in marketing swimwear. Victoria’s Secret’s lawyers — H. Robert Fiebach of Philadelphia-based Cozen O’Connor and Frank J. Colucci and Richard P. Jacobson of Colucci & Unams in New York — argued that Victoria’s Secret should be allowed to advertise its swimwear as containing the Miracle Bra technology or its cleavage-enhancing features. Van Antwerpen disagreed, saying “we find that this exception would simply create more confusion in this case. We further find that creating this exception would result in an injunction that would be very difficult to enforce by making the judicial system monitor the continued sale and marketing of Victoria’s Secret’s swimwear and the inevitable disputes as to whether this exception had swallowed the rule.” Although Victoria’s Secret is sure to be harmed by the injunction, Van Antwerpen said, “it must be noted that a defendant cannot have a ‘legitimate interest’ in the use of a mark that infringes on another’s mark.” And the harm to Victoria’s Secret, he said, must be balanced against the harm to A&H caused by the likelihood of reverse confusion. “Without this injunction, A&H will likely lose control of its corporate identity and reputation, suffer harm or devaluation of its goodwill, and lose its ability to expand into new markets,” Van Antwerpen wrote.

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