(CN) – The makers of Jose Cuervo tequila copied the dripping red wax seal from famed bourbon house Maker’s Mark, the 6th Circuit ruled.
Maker’s Mark filed an infringement claim against Jose Cuervo in 2003 over Reserva de la Familia that the tequila giant started selling with a dripping red wax seal in 2001.
The whiskey giant sought damages and an injunction against dilution and infringement, while Jose Cuervo countersued to cancel the trademark.
After a six-day bench trial, a federal judge in Louisville, Ky., found that Maker’s Mark had a valid trademark and prohibited Jose Cuervo permanently from using a dripping red wax seal.
Finding that Jose Cuervo had not diluted the wax trademark, however, the court refused to award damages.
In a separate opinion, the court awarded Maker’s Mark some of its costs.
On appeal, Jose Cuervo insisted that the red dripping wax seal is aesthetically functional. It also fought some of the court’s factual findings and the costs award.
But the Cincinnati-based 6th Circuit affirmed.
“Even assuming we were to recognize aesthetic functionality doctrine, regardless of which test we would apply under that doctrine, the outcome is the same,” Judge Boyce Martin wrote for a three-judge panel. “Under either test, Cuervo’s appeal on this claim does not succeed. The District Court was not convinced ‘that it would be difficult or costly for competitors to design around’ the mark and we do not disagree. There is more than one way to seal a bottle with wax to make it look appealing, and so Cuervo fails the comparable alternatives test. As to the effective competition test, the district court found that ‘red wax is not the only pleasing color of wax … nor does it put competitors at a significant non-reputation related disadvantage to be prevented from using red dripping wax.’ The District Court’s findings are not clearly erroneous, and, based on those findings, Cuervo fails either test.”
The federal appeals court also upheld the trial judge’s factual accuracy.
“In sum, none of Cuervo’s arguments undermines the District Court’s finding ‘that the Maker’s Mark red dripping wax seal is an extremely strong mark due to its unique design and the company’s singular marketing efforts,'” Martin wrote. “We therefore conclude that the district court did not clearly err in its evaluation of the strength of the red dripping wax seal.”