U.S. Polo Ass’n, Inc. v. PRL USA Holdings, Inc.

In the latest episode of a 30-year dispute over the use of marks depicting mounted polo players, the U.S. Court of Appeals for the Second Circuit vacated the district court’s order finding contempt of a 2012 injunction. U.S. Polo Ass’n, Inc. v. PRL USA Holdings, Inc., Case Nos. 13-1038, -1130 (2d Cir., May 13, 2015) (Winter, C.J.).

The U.S. Polo Association (USPA) is the national governing body for the sport of polo, but it also sells branded apparel, accessories and other products. The appellees (collectively PRL) own the Polo Ralph Lauren marks, including the famous logo depicting a single mounted polo player with a raised mallet.

The first case between the parties ended in 1984 and resulted in PRL’s victory and a broad injunction barring the USPA from using any mark “confusingly similar” to the PRL marks in connection with any goods or services. In 1996, the USPA began using the Double Horsemen Mark, depicting two mounted polo players, in connection with apparel, leather goods and watches. A jury found that this use was not infringing. Several years later, the USPA started using the Double Horsemen Mark on fragrance products, and this time, PRL brought suit and won. The district court enjoined the USPA both from using the Double Horsemen Mark in connection with fragrance or cosmetic products and—borrowing the language of the 1984 injunction—from using the PRL marks or any “confusingly similar” marks in any market.

After learning that the USPA had been using the Double Horseman Mark on sunglasses, PRL moved for an order of contempt. The district court found the USPA in contempt, as PRL had clearly and convincingly established that the mark was “confusingly similar” to PRL’s logo. The court declined to consider the specifics of the eyewear market in assessing infringement, finding that the second injunction applied to all markets. USPA appealed.

The 2d Circuit disagreed with the district court, emphasizing the “critical fact” that a jury had found the contested mark non-infringing when used on apparel, leather goods and watches, which established that the mark may be infringing in some markets but not infringing in others. Therefore, the district court should have assessed confusing similarity on a market-by-market basis. Here, the district court had erroneously relied on the 2d Circuit’s Wella decision to conclude otherwise. In Wella, the 2d Circuit had determined the market-by-market analysis was inappropriate because there was no doubt that the mark at issue was infringing and that the injunction covered all markets.

The Court also noted that a finding of contempt requires more than a finding of infringement. For a contempt order to issue, an enjoined party must be on clear notice that its conduct violates the injunction and there must be clear and convincing evidence that the mark in use is confusingly similar to or otherwise infringes the protected marks. Because the record did not support either finding, the Court vacated the contempt order and remanded for further proceedings.