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From Intellectual Property Law Daily, November 29, 2018

SafeRack’s orange color mark for fall protection equipment infringed but damages not warranted

By Joseph Arshawsky, J.D.

SafeRack, LLC, established a valid registration in its design mark of orange as applied to railings, gates and cages of fall protection equipment, and also established that a model displayed by Bullard Company at a trade show caused a likelihood of confusion as to origin with SafeRack’s mark, the federal district court in Charleston, South Carolina has ruled. The court held that SafeRack was entitled to summary judgment on trademark infringement and a permanent injunction, but not damages. In addition, the court ruled that Bullard’s affirmative defenses lacked merit (SafeRack, LLC v. Bullard Co., November 28, 2018, Gergel, R.).

The USPTO registered SafeRack’s Design Mark No. 5,211,514, which included a photo of a gangway and stated that "the color orange is claimed as a feature of the mark." The mark consists of the color orange as applied to railings, gates and cages of fall protection equipment. In June 2017, Bullard attended the Independent Liquid Terminals Association (ILTA) trade show and showcased a work platform and gangway with orange railings and other features. On June 12, 2017, SafeRack sent a cease and desist letter to Bullard. Bullard asserts that while it showcased the units, it never sold any with that configuration. SafeRack presented no evidence that Bullard ever sold a work platform or gangway as showcased at the ILTA. SafeRack argued that Bullard’s use of orange on "gangways, railings, and gates" at the ILTA in 2017 and Bullard’s sale of mobile access platforms (MAPs) infringed on its trademark and trade dress and constituted unfair competition in violation of the Lanham Act and the South Carolina Unfair Trade Practices Act (SCUTPA). SafeRack also brought a claim for unjust enrichment. Bullard argued that the use of orange on its equipment was not likely to cause confusion and presented six affirmative defenses. This opinion arose on the parties’ cross-motions for summary judgment, which the court granted and denied in part.

Ownership of a valid mark. There is no dispute that SafeRack owns a valid trademark to the color orange as applied to railings, gates, and cages of fall protection equipment. Here, SafeRack has a presumption of ownership of its mark since June 11, 2014, when its trademark was filed with the USPTO. SafeRack sold its first loading rack with orange colored components in September 2003. Bullard has presented no evidence to dispute this fact. Bullard first showcased orange on the railings of its fall protection equipment in June 2017, after SafeRack's registration was both filed and granted. SafeRack therefore owns a valid trademark to the color orange as applied to railings, gates, and cages of fall protection equipment. Therefore, it is undisputed that SafeRack owns a trademark to the color orange specifically as applied to railings, gates, and cages of fall protection equipment.

Used in commerce without consent. There is no dispute that Bullard used this mark in commerce without consent. Bullard admits that it showcased a work platform and gangway with orange railings and cages at the ILTA in June 2017. There is no evidence that Bullard used the mark without consent at any other time. The only other evidence of Bullard using orange on its equipment is its use of orange on the vehicle base of seven MAPs it sold in 2015 and 2016. However, the vehicle base of the MAP included no railings, gates, cages, or any other type of fall protection equipment. Therefore, it is undisputed that Bullard used Safe Rack's mark in commerce without consent at the ILTA in June 2017 and at no other time.

Offer for sale or advertising of goods. There is no dispute that Bullard showcased and advertised the work platform and gangway with orange railings and cages at the June 2017 ILTA. The ILTA is an important trade show in Bullard’s and SafeRack’s industry. Therefore, it is undisputed that by showcasing a work platform and gangway with orange railings and cages, Bullard used the mark in connection with the advertising of goods or services.

Strength and distinctiveness of mark. The court began its likelihood of confusion analysis by considering SafeRack’s mark’s strength. Here, there is no dispute SafeRack placed the color orange in a context that seems unusual and distinctive, namely, on railings, cages, gates and other fall protection equipment, and used it continuously in the marketplace. There is therefore no dispute that SafeRack has a strong mark.

Similarity of marks.There is no material dispute that Bullard’s use of orange on railings, gates and cages of fall protection equipment, is similar to SafeRack’s mark. Bullard's equipment showcased at the 2017 ILTA included orange on the railings, gates and cages of gangways and other safe access equipment, just as SafeRack’s similar equipment. The question is whether the marks are similar such as to cause confusion, not whether the specific shade comports perfectly to prior use. The fact that marks may use different shades of the color does not preclude a finding of similarity.

Similarity of goods. There is no material dispute that the mark was used on similar goods. The equipment Bullard showed at the 2017 ILTA is similar to SafeRack’s safe access units and equipment for loading and unloading transportation vehicles.

Similarity of facilities and advertising. There is no material dispute that Bullard and SafeRack use similar facilities and advertising. Both Parties sell their products to the same consumers, in the same market, and use similar advertising. Further, Bullard's 30(b)(6) witness acknowledged that its products are marketed towards substantially the same consumers as SafeRack, and listed SafeRack as a competitor. It is also undisputed that both attend the ILTA tradeshow, and use personal contacts, catalogues and a website to market their products.

Actual confusion. SafeRack presented the evidence of at least one consumer who stated that when he saw Bullard's products at the 2017 ILTA show, he thought "they are piggy backing off of SafeRack." Therefore, there is no material dispute on the issue of actual confusion.

Likelihood of confusion. There is no dispute of material fact that Bullard's use of the orange mark created a likelihood of confusion. The court concluded that there is no dispute of material fact that SafeRack has ownership of an orange color mark on railings, gates, and cages of fall protection equipment, that Bullard used the mark in commerce without authorization when it advertised its safe access and loading equipment with orange railings, gates and cages at the 2017 ILTA, and that this use was likely to cause confusion.

Bullard’s defenses. Bullard presented six defenses to SafeRack’s allegations of trademark infringement: the orange color was functional, fair use, SafeRack’s mark was not distinctive for all shades of orange, the use of the color orange on fall protection equipment is generic, that SafeRack abandoned the mark, and that SafeRack obtained the registration fraudulently. Each affirmative defense was without merit.

Functionality. If multiple other colors can serve the same purpose, that weighs against a finding of functionality. Bright orange coloring on signs or equipment may sometimes be used to grab attention and indicate caution, yet there is no indication that the way in which SafeRack uses orange, in a distinctive way on fall protection equipment, is functional. First, Bullard relied extensively on an Occupational Safety and Health Administration ("OSHA") regulation identifying orange as a "safety color," 29 C.F.R. § 1910.145(f). These definitions do not indicate that the color orange on the railings here is functional. Second, Bullard relied on a publication by the American National Standards Institute ("ANSI"), 2535.1-2017, that identifies a particular shade of orange, allegedly the one used by Bullard, as "safety orange." However, the publication also lists safety colors for red, yellow, green, blue, purple, white, and black, and ANSI gives no indication that those seven colors are the only colors that can indicate safety. Finally, Bullard has pointed to no laws, regulations, standards, or admissible evidence indicating that orange is required or even recommended for the railings, cages, gates or other fall protection equipment in the safe access equipment industry. Instead, many other competitors use metallic gray or other colors, such as yellow. Therefore, there is no material dispute that SafeRack's orange color mark is nonfunctional.

Fair use. Bullard’s argument for fair use duplicates its arguments regarding the use of orange as a safety color under OSHA and ANSI recommendations. These arguments fail for the same reasons. There is no material dispute that Bullard's use of orange did not constitute fair use.

Genericness. SafeRack’s registration of its mark "is prima facie evidence that the registered term is not generic." SafeRack has already submitted undisputed testimony from consumers that its use of orange to the purchasing public indicates the company rather than the class of product. Bullard’s arguments regarding the mark being generic further try to relitigate issues of orange as a color that denotes safety, which the court already found unpersuasive. Therefore, it is undisputed that SafeRack’s mark is not generic. It is undisputed that SafeRack’s mark is distinct.

Abandonment. Bullard's argument regarding abandonment again turns on SafeRack’s alleged failure to ever use the specific shade of orange on the Pantone scale that Bullard placed on its safe access equipment. Again, this argument is unpersuasive. There is no evidence in the record that SafeRack has abandoned its orange mark as used on its railings, gates, or cages of fall protection equipment. Therefore, it is undisputed that SafeRack did not abandon the orange color mark.

Fraud. Simply because some part of a product does not have orange does not prevent SafeRack from counting the sale as related to its orange color mark. Similarly, SafeRack's position has been consistent regarding which of Bullard's products it alleges are infringing on SafeRack's trademark. It is therefore undisputed that the registration was not obtained fraudulently. Therefore, Bullard is not entitled to summary judgment on any of its affirmative defenses and, because SafeRack met the four-part test for trademark infringement, SafeRack is entitled to summary judgment on its Lanham Act trademark infringement claim regarding Bullard’s use of orange on railings, gates and cages. Bullard’s use of orange on the vehicle base of the MAP did not constitute trademark infringement since SafeRack owned no valid trademark regarding orange on areas of equipment unrelated to fall protection and, regardless, SafeRack could not demonstrate likelihood of confusion.

Damages. SafeRack moved for damages of $1,750,000 based on Bullard’s profits from the sale of seven MAP units in 2015 and 2016. However, Bullard’s production and sale of the MAP units did not infringe on SafeRack’s trademark. SafeRack did not submit any other evidence demonstrating damages from Bullard’s infringement. Therefore, SafeRack's motion for summary judgment regarding actual damages under the Lanham Act is denied.

Permanent injunction. An injunction is clearly proper here. Obvious mark infringement by Bullard would cause irreparable harm to SafeRack. Furthermore, since Bullard never sold any infringing equipment and it instead chose to "await the decision on this lawsuit" before selling the equipment with orange components, purely legal remedies are inadequate and would not prevent Bullard from deciding at some point in the future to sell equipment with orange railings, gates or cages. The hardships balance in SafeRack’s favor as its mark would be infringed upon and Bullard has no right to infringe on SafeRack’s mark, and the public interest would be served by preventing future consumers from being misled. Therefore, SafeRack is entitled to a permanent injunction against Bullard using the color orange as applied to railings, gates, and cages of fall protection equipment.

Other claims. The court’s grant of summary judgment and a permanent injunction on SafeRack’s trademark infringement claim under the Lanham Act moots SafeRack's claim for trade dress infringement and unfair competition under§ l 125(a). SafeRack, however, is entitled to summary judgment on its claim for unfair competition under the SCUTPA. The standard under the SCUTP A is the same as the standard under the Lanham Act, and focuses on whether the infringement is likely to cause confusion. Therefore, for the same reasons discussed regarding SafeRack’s trademark infringement claim, it is undisputed that SafeRack is entitled to summary judgment for unfair competition under the SCUTPA. Nonetheless, as above, SafeRack has not demonstrated any "ascertainable loss of money or property" and therefore is not entitled to damages under the SCUTPA. Here, SafeRack failed to present any evidence that any benefit was conferred or that Bullard realized any benefit from its use of the mark (such as evidence of sales or customers from of its use of orange at the 2017 ILTA), and Bullard is therefore entitled to summary judgement on SafeRack’s claim for unjust enrichment.

This case is No. 2:17-cv-01613-RMG.

Attorneys: Angelica Marie Colwell (Nexsen Pruet, LLC) for SafeRack LLC. David Spence Cox (Barnwell Whaley Patterson and Helms LLC) for Bullard Co.

Companies: SafeRack LLC; Bullard Co.

MainStory: TopStory Trademark SouthCarolinaNews

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