Vacating a district court’s judgment that Starbucks had failed to sustain its burden in proving trademark dilution, the U.S. Court of Appeals for the Second Circuit held that a post-decision, congressional amendment to the Federal Trademark Dilution Act (FTDA) required a remand for application of the amended statute to Starbucks’ injunctive relief claim. Starbucks Corp. v. Wolfe’s Borough Coffee, Inc., No. 06-0435 (2nd Cir., Feb. 15, 2007) (Trager, J., Eastern District of New York, sitting by designation).
Starbucks brought suit against Wolfe’s alleging that Wolfe’s current sale of coffee under the name "Mister Charbucks" or "Mr. Charbucks" infringes and dilutes the "Starbucks" trademark for coffee. Following a bench trial, the district court concluded in December 2005 that Starbucks had failed to carry its burden of proving, inter alia, trademark dilution under the FTDA. Subsequent to the district court’s order, however, Congress amended the FTDA in response to the Supreme Court decision, Moseley v. V. Secret Catalogue, Inc., 537 U.S. 418 (2003), which construed the FTDA to require a showing of actual dilution. The FTDA, as amended, allows the owner of a famous, distinctive mark to an injunction against the user of a mark that is "likely to cause dilution" of the famous mark.
On appeal, the Second Circuit applied the principle that, when an intervening statute affects the propriety of prospective relief, application of the new provision is not retroactive. Accordingly, the panel held that the amended FTDA properly applied to this case to the extent that Starbucks has sought injunctive relief on the issue of dilution.
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