Caraway Home, Inc. v. Pattern Brands, Inc.

Background

Caraway Home, Inc. sued Pattern Brands, Inc., doing business as Equal Parts, over Equal Parts’s cookware and advertising. Caraway alleged that Equal Parts’s cookware copied protectable aspects of Caraway’s designs, including the cookware’s handles, colors, interiors, and lids. Caraway also alleged that Equal Parts purchased the “Caraway” trademark as a keyword for Google advertisements so that Equal Parts advertisements would appear when consumers searched for “Caraway.”

The complaint asserted nine counts. Counts One through Six involved alleged trade-dress infringement and related claims under federal and New York law. Counts Seven through Nine involved trademark infringement, unfair competition and false designation, and federal trademark dilution based on the alleged use of the Caraway trademark in keyword advertising.

Motion to Dismiss

The court treated the parties’ preliminary letters as Pattern Brands’s motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), which applies when a complaint does not adequately state a claim. At this stage, the court accepts well-pleaded factual allegations as true and considers whether they plausibly support relief, rather than deciding what evidence ultimately proves.

Pattern Brands argued that Caraway had not described its claimed unregistered product trade dress precisely enough, had not adequately alleged that the designs were nonfunctional, and had not plausibly alleged likely consumer confusion. It also argued that using the Caraway trademark as an advertising keyword could not support infringement claims when the advertisements themselves did not use the mark.

Trade-Dress Claims

The court held that Caraway had described some design features with enough specificity, including the frying pan’s deep bowl shape and high sidewalls, the U-shaped space between the handle and pan, the flattened disc-shaped lid, and the cookware’s cream and navy colors. But the court found many other descriptions—such as the cookware’s “overall look and appearance” and the “visual flow,” curves, tapers, and lines—too vague to tell competitors and the court what features Caraway claimed.

The court also held that Caraway had not adequately alleged how most of the described features were distinctive. General statements that the designs were unique or revolutionary did not explain how they differed from ordinary cookware. The court found that Caraway had adequately explained the distinctiveness of the flattened, disc-shaped lid compared with ordinary steel or glass lids, but that was not enough to save the broader trade-dress claims.

The court further held that Caraway had not specifically alleged that the claimed features were nonfunctional. A feature may be functional if it is necessary to a product’s use or affects its cost or quality; an aesthetic feature may be functional if exclusive use would put competitors at a significant disadvantage unrelated to reputation. Caraway’s conclusory statement that its designs were nonfunctional did not provide enough factual support.

Because Caraway failed to adequately plead the required protectability and nonfunctionality of its trade dress, the court dismissed Counts One through Six without prejudice. The court rejected Pattern Brands’s argument that amendment would be futile.

Trademark Claims Based on Keyword Advertising

The court denied dismissal of Counts Seven through Nine. It held that purchasing trademarks as internet-advertising keywords qualifies as using the mark in commerce. Caraway alleged that the “Caraway” mark was registered and owned by Caraway, giving the mark a presumption of distinctiveness.

The court also found Caraway’s allegations of likely confusion sufficient at the pleading stage. Caraway alleged that Equal Parts used the mark to advertise its own brand, that consumers could believe Equal Parts’s products were authorized or affiliated with Caraway, and that a third party had described the products as “almost identical.” Likelihood of confusion is ordinarily a fact-intensive question that is not resolved on a motion to dismiss unless no reasonable factfinder could find confusion.

The court distinguished a prior case that had evaluated keyword advertising after a bench trial. Here, the court had no evidence before it and concluded that Caraway could potentially present advertisements showing similarity in appearance and meaning sufficient for a factfinder to find likely confusion.

Disposition

The court granted in part and denied in part Pattern Brands’s motion to dismiss. Counts One through Six were dismissed without prejudice, while Counts Seven through Nine remained. The court ordered Caraway, within 20 days of the order, either to file an amended complaint or notify the court that it wished to stand on the complaint as filed.