(CN) - "Mister Charbucks" and "Charbucks Blend" labels used by a New Hampshire coffee house will not dilute the Starbucks trademark, the 2nd Circuit ruled.
Starbucks had sought an injunction barring New Hampshire-based Wolfe's Borough Coffee dba Black Bear Micro Roastery from using the marks "Mister Charbucks" and "Charbucks Blend."
A federal judge in Manhattan denied injunctive relief under the Federal Trademark Dilution Act, finding that there is only a "minimal degree of similarity" between the parties' marks.
Affirming that finding Friday, a three-judge panel of the 2nd Circuit said that the context of the Charbucks marks, which Black Bear displays on its packaging and its website as one of several coffee blends, differentiates them from Starbucks' famous marks.
Starbucks failed to show that Black Bear intended to create an association with Starbucks, which "raises a 'presumption of association,' or at least is strong evidence of actual association," according to the opinion.
The 29-page decision notes that Black Bear founder James Clark III testified that the name Charbucks had previously been used during "the coffee wars in Boston between Starbucks and the Coffee Connection."
Clark's testimony was not an "admission" of actual association and his intentions "were not definitive proof of an actual association between the marks," Judge Raymond Lohier wrote for the panel.
A telephone survey that Starbucks conducted showed that most consumers think of its name or just "coffee" when they hear the name "Charbucks."
The 2nd Circuit found that the lower court properly discounted the survey evidence, however, because the survey measured "only how respondents reacted to the isolated word Charbucks rather than to the Charbucks Marks in context, and because the share of respondents who indicated an association between the marks was relatively small."
The survey also did not present the marks as they appear in commerce, according to the ruling.
Starbucks boasts 8,700 retail locations worldwide and revenues of $5.3 billion in fiscal year 2004. Black Bear Micro Roastery describes itself as a small, dedicated, quality focused micro-roastery in New Hampshire's Lake Region that sells via mail and Onternet order, in a limited number of New England supermarkets and at its single retail outlet.
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