01
May
2001

Court Protects Retailer's "Wall of Wine" Display

Intellectual Property Alert

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PUBLISHED ON: May 1, 2001

How does a retailer of wine distinguish his business from that of a myriad of other wine retailers? Moreover, after recognition among consumers has been assiduously fostered, what would be the manner in which the retailer retains such goodwill?

A solution to both these concerns is provided by the concept of trade dress. Trade dress is the overall appearance of product packaging or product presentation, i.e., its total image, which includes such elements as labeling, size, color, color combinations, texture, and/or graphics. In a recent ruling, the U.S. District Court, Southern District of New York, granted trade dress protection to a Manhattan wine retailer for the unique manner in which the wine bottles were displayed in his store (Best Cellars, Inc. v. Grape Finds at Dupont, Inc., SDNY No. 99 Civ. 12254 (RWS)).

In an attempt to demystify the buying of wine, Joshua Wesson (“Wesson”), a wine expert, sommelier, and author of several articles on wine, developed the concept of selling “wine by style”. Rather than categorize wine by grape type or place of origin, he categorized them by taste and weight. To make the process of wine selection a simple exercise for the novice buyer, Wesson reduced the world of wine to eight taste categories and selected a single word to serve as a “primary descriptor” for each category: “fizzy” for sparkling wines, “fresh” for light-bodied white wine, “soft” for medium-bodied white wine, “luscious” for fullbodied white wine, “juicy” for light-bodied red wine, “smooth” for medium-bodied red wine, “big” for full-bodied red wine, and “sweet” for dessert wines. For each taste category, the graphics designer created a corresponding color and graphic image to reinforce the sensory association of each category. Thus, for example, the “fizzy” category (sparkling wines) is represented by an iceblue color and a visual of rising bubbles.

Additionally, in order for a non-connoisseur purchaser not be overwhelmed by the vast number of wines available, Wesson limited the number of wines for sale to approximately one hundred, and priced them at ten dollars or less. The wine bottles are displayed along the perimeter walls of the store. A display bottle of each wine is placed at slightly above eyelevel and a “shelf-talker” below it. The shelf-talker contains information about the place of origin of the wine, its price, its vintage and the type of grape it is made from. Beneath the display bottle and the shelftalker, nine additional bottles of the same wine are stored horizontally in a racking system made of Plexiglas tubes. This is lit from behind, which causes the bottles to glow, without harming the wine. Thus, the wine bottles themselves are a decorative element. The Court observed that the overall effect achieved, namely, a “wall of wine”, consisting of rows of glowing wine bottles, which was quite striking.

The Best Cellars store in New York City opened in 1996. It received extensive press coverage and was featured in several general interest and wine industry publications. Its owners and designers were recipients of several awards. Plans were afoot to expand this novel system of retailing wine to several states in the U.S.

The Grape Finds enterprise was founded by Jack Mazur, who had visited the Best Cellars store in Manhattan on a number of occasions. He and his team of designers set about in a concerted bid to copy the look and feel of Best Cellars’ stores that incorporated Best Cellar’s unique concept of marketing wine by taste. Although Grape Finds’ shelf-talkers contain slightly different information and the primary descriptors of the eight taste categories are different, the dominant, glowing “wall of wine” design feel of Best Cellars was replicated. Best Cellars sued Grape Finds alleging, inter alia, trade dress infringement and unfair competition.

Trade dress is a broad concept, and includes all the elements constituting the total visual image by which the product is presented to the consumers. The Lanham Act proscribes similarity in the trade dresses of different sources because such similarity can lead to confusion in the minds of consumers as to the product’s origin. It may also cause confusion, or mistake, or deception as to the affiliation, connection, or association between the different sources. Courts, therefore, apply principles of trademark law to trade dress, thereby securing the goodwill of the business to the owner and protecting the ability of consumers to distinguish among the sources of the goods. This fosters competition and enables a producer to reap the full rewards of good reputation.

However, a plaintiff seeking relief from the Court must generally demonstrate that (1) its trade dress is either inherently capable of distinguishing its goods from those of others, or that the trade dress has acquired such capability, (2) the defendant’s trade dress is so similar that there exists a likelihood that consumers would be confused between its trade dress and that of the defendant’s, and (3) if unregistered, its trade dress is non-functional or, in other words, it is not essential to the use or purpose of the associated goods or affecting the quality of the goods. This burden is placed on the plaintiff to avoid the anti-competitive effects of an over-extension of trade dress protection.

The Court began its analysis of trade dress infringement with an evaluation of the distinctiveness of the Best Cellars’ trade dress. Trade dress is classified on a spectrum of increasing distinctiveness as generic, descriptive, suggestive, or arbitrary/ fanciful. The latter two grades are considered inherently distinctive. Looking at the overall trade dress of Best Cellars (the combination of the several elements), the Court found that the trade dress was arbitrary and, therefore, inherently distinctive. Best Cellars success at its goal of designing an “anti-wine store” or, “not a wine store at all”, as part of its efforts at reinventing wine retailing, evidenced by the several awards and extensive press coverage it received, persuaded the Court to reach such a conclusion.

The Court also found that the trade dress was non-functional. A finding of non-functionality is essential because the grant of exclusive use of a functional trade dress configuration to one manufacturer would place competitors at a “significant non-reputationrelated disadvantage”. The Best Cellars trade dress was, like most trade dresses of this nature, a combination of commonly used elements. However, the elements themselves could be combined in several different ways. Therefore, the grant of exclusive use of the unique combination that was used by Best Cellars would not place competitors at any disadvantage.

Applying the classic 8-factor Polaroid test for an analysis of likelihood of confusion, the Court came to the conclusion that Grape Finds’ use of a similar trade dress would likely cause confusion among consumers as to the source of the product. Further, the element of bad faith misappropriation of the labors and expenditures of Best Cellars by Grape Finds met the standard of unfair competition. The Court enjoined Grape Finds from using the precise configuration of the “wall of wine” display because this uniquely embodied Best Cellar’s concept of selling wine by taste or style.

The general concept of selling wine by style was found to be unprotectable and the defendant could continue to use that style. However, the Court held that the defendant’s “concrete expression” of the concept must be different from plaintiff’s “wall of wine” display.