The phrase “Swiss Army knife” has never enjoyed trademark protection. This appeal considers chiefly whether that phrase is descriptive of geographic origin or product quality, and therefore protectible under the false advertising provision of the Lanham Act.
Victorinox Cutlery Company (“Victorinox”) of Switzerland has manufactured multifunction poeketknives since 1892. Another Swiss firm, Wenger, S.A. (“Wenger”), has manufactured multifunction poeketknives since 1908. Since early in this century, these two Swiss firms have been the only purveyors of multifunction poeketknives to the Swiss Armed Forces. American soldiers returning from Europe after World War II coined the phrase Swiss Army knife to describe the intricate and ingenious poeketknives used by the Swiss military.
In 1950, plaintiff-appellee The Forschner Group, Inc. began importing poeketknives manufactured by Victorinox into the United States, and began calling them Swiss Army knives in 1958. The United States distributor of the Wenger knives, Precise Imports Corporation, is not a party to this litigation.
Early in 1992, defendant-appellant Arrow Trading Co., Inc. (“Arrow”) began marketing in the United States an inexpensive and shoddy multifunction pocketknife manufactured in China. Arrow nevertheless referred to its knife as a Swiss Army knife and embossed the words “SWISS ARMY” on one side.
The Forschner Group and its subsidiary Swiss Army Brands, Ltd. (collectively “Forschner”) immediately brought an action for injunctive relief against Arrow, alleging violations of § 43(a) of the Lanham Act and unfair competition under New York common law. The United States District Court for the Southern District of New York (Preska, /.), found that Arrow’s use of the phrase Swiss Army knife in connection with a multifunction pocketknife that was not manufactured in Switzerland and that was not of high quality constituted a misrepresentation as to geographic origin and quality, in violation of § 43(a). The district court therefore enjoined Arrow from representing that its knife was a Swiss Army knife. We vacate the order of the district court because we hold that the phrase Swiss Army knife is neither geographically nor qualitatively descriptive, and we remand for consideration of whether Arrow’s use of the phrase Swiss Army knife otherwise amounts to a violation of § 43(a) or unfair competition.
BACKGROUND
The facts of this appeal are not in dispute and are set forth by the district court in every useful detail,
Forschner Group, Inc. v. Arrow Trading Co.,
The multifunction poeketknives made by Victorinox and Wenger are renowned for their quality and durability, and are the object of a mystique. As the district court stated, these knives “have taken on the qualities of legend, albeit less regal than Excalibur.”
Forschner,
In January 1992, Arrow began marketing a multifunction knife manufactured in China (the “Arrow knife”). The physical appearance of this knife is similar, albeit distinguishable, from that of a Victorinox or Wen-ger knife.
Forschner,
The knives distributed by Forschner are distinctive because of (i) their red color, (ii) the cross-and-shield symbol that appears on one side, and (iii) the following inscription found on the tang of the main blade: VICTORINOX / SWITZERLAND / STAINLESS/ROSTFREI.
The Arrow knife, which is also red in color, contains the embossing “SWISS ARMY” on one side. Above those words is a cross-and-shield design distinguishable from the one that appears on knives distributed by Forschner. A small “TM” is placed between the cross-and-shield design and the letter “M” in “SWISS ARMY.” The tang of the main blade of Arrow’s knife is marked: STAINLESS/CHINA. The top of the box in which Arrow distributes its knives shows the words “SWISS ARMY” together with Arrow’s cross-and-shield design. Adjacent to this design are the words: 11 FUNCTION/SWISS ARMY KNIFE. The side of the box states that “THE SWISS ARMY LOGO DESIGN IS A TRADEMARK USED UNDER LICENSE BY ARROW TRADING CO., INC. NEW YORK, N.Y. 10010, USA.” Below this appear the words “Made in China.”
The small “TM” on the side of Arrow’s knife and the licensing statement on the box supposedly reference the cross-and-shield design, not the words “SWISS ARMY.” Arrow allegedly uses the cross-and-shield design pursuant to a licensing agreement with its sister company (Colony Corporation), which has submitted a trademark application for the design.
On August 18, 1992, Forschner sent a cease and desist letter to Arrow. Forschner objected to the licensing statement that appears on the side of the box in which the Arrow knife is packaged. Since the phrase “Swiss Army” is not a registered trademark, Forschner asserted that Arrow did not (and could not) have a license to use “Swiss Army” as a trademark under license on its pocketknife. Accordingly, Forschner requested that Arrow
stop representing that “Swiss Army” or the Swiss Army design logo used on Arrow’s packaging is a trademark used by it under license; and from using the term “Swiss Army” or “Swiss Army Knife” on or in connection with the advertising, promotion, offering for sale or sale of knives not manufactured in Switzerland.
Arrow refused.
On September 22, 1992, Forschner filed a complaint in the Southern District of New York seeking to enjoin Arrow from marketing the Arrow knife as a Swiss Army knife. Although the complaint is not entirely clear, we read Count I to allege misrepresentation as to manufacturer or source under § 43(a), 15 U.S.C. § 1125(a)(1)(A) (1988), a claim which includes “passing off’; Count II to allege false advertising in respect of geographic origin and quality under § 43(a), 15 U.S.C. § 1125(a)(1)(B); and Count III to allege unfair competition under New York common law.
The proceedings in the district court focused almost exclusively on Count II, in which Forschner alleged that, with reference to a multifunction pocketknife, the phrase Swiss Army denotes a knife that is manufactured in Switzerland and that is of the same high quality as the knives produced by Victo-rinox and Wenger. Therefore, Forschner contended, Arrow’s use of the phrase Swiss Army knife in connection with Arrow’s poor *352 ly-crafted Chinese-manufactured knife constitutes false advertising.
During the bench trial, Forschner and Arrow presented the results of consumer surveys prepared by their respective experts. While each party disputes the significance of the other’s survey, it is sufficient for purposes of this appeal to note that (i) roughly 40% of the relevant public believes that a Swiss Army knife is manufactured in Switzerland, 1 and (ii) between 34% and 43% of the relevant public believes that the phrase Swiss Army knife denotes a knife of “high quality.”
Arrow argued that this survey evidence demonstrates that a Swiss Army knife does not necessarily signify Swiss manufacture or high quality. Instead, Arrow argued that the phrase Swiss Army knife is a generic term for a multifunction poeketknife, of any quality, manufactured anywhere.
After trial, the district court made the following findings of fact:
— There is a “clear association between the term ‘Swiss Army knife’ and knives of high quality manufactured in Switzerland.” Forschner,833 F.Supp. at 390 .
— “[C]onsumers perceive the [Arrow] knife to be of high quality and produced in Switzerland because Arrow represents it to be a Swiss Army knife through the use of the words ‘SWISS ARMY’ and the cross-and-shield design.” Id. at 391.
— There is a likelihood that ordinary consumers will be “misled, or indeed simply confused as to the geographic origin and quality of the [Arrow] knife.” Id.
— The Arrow knife, “whether considered alone or in its box, is perceived by the purchasing public to be a Swiss Army knife — a high-quality, Swiss-made product — which it is not.” Id. at 392.
Thereupon, the district court enjoined Arrow from promoting or selling as a Swiss Army knife any knife that is not of Swiss manufacture and of high quality.
Arrow now appeals.
DISCUSSION
Forschner conceded that Swiss Army knife is not a registered trademark and therefore Forschner did not (and cannot) assert exclusive use of that phrase. Forschner, 833 F.Supp. at 388. Instead, Forschner argued that Arrow’s use of the phrase Swiss Army knife violates the false advertising provision of the Lanham Act. Based on the survey evidence it credited, the district court agreed.
We hold that Arrow’s use of the phrase Swiss Army knife does not constitute false advertising under § 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B). The phrase Swiss Army knife is not geographically descriptive such that its use in connection with a multifunction poeketknife manufactured outside Switzerland constitutes a false designation of geographic origin. This conclusion forecloses the possibility that the phrase Swiss Army knife is somehow qualitatively descriptive, since inferences as to quality are integral to geographic deseriptiveness. While Victori-nox and Wenger may (or may not) be able to register the phrase for trademark protection, they cannot enjoy trademark rights without registration, or enforce such rights by means of a false advertising claim. We also hold that, even if (as Arrow contends) Swiss Army knife is a generic phrase for a multifunction poeketknife, Arrow may be found to have violated 15 U.S.C. § 1125(a)(1)(A) or to have otherwise engaged in unfair trade practices by misrepresenting the manufacturer or source of its knife.
A. 15 U.S.C. § 1125(a)(1)(B) — False Advertising
The district court classified this action “as falling within the law of unfair competition or false advertising and not trademarks,”
Forschner,
Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which—
(A) is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or
(B) in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities,
shall be hable in a civil action by any person who believes that he or she is or is likely to be damaged by such act.
Relying on subsection (B), and survey evidence, the district court found that a Swiss Army knife is necessarily a high-quality knife manufactured in Switzerland, and therefore concluded that Arrow falsely designated the geographic origin and quality of its knife. The district court’s analysis effectively affords Yictorinox and Wenger trademark protection.
1. Geographic Origin
There is no doubt that injunctive relief under § 43(a) of the Lanham Act is appropriate if needed to protect a geographically descriptive term. The district court relied upon a series of cases so holding.
See Black Hills Jewelry Mfg. Co. v. Gold Rush, Inc.,
Questions of false designation of geographic origin are properly considered within the analytical framework used to gauge the distinctiveness of trademarks. The strongest mark (and the one most eligible for trademark protection) is an “arbitrary” coinage, with the strength of a mark declining in distinctiveness to the “suggestive”, down to the “descriptive”, and finally to the “generic” (the weakest and least distinctive mark).
Coach Leatherware Co. v. Ann Taylor, Inc.,
Under the false advertising provision of the Lanham Act, a phrase is eligible for protection as a representation of geographic origin only if the phrase is geographically descriptive
(i.e.,
Swiss watches, Idaho potatoes).
See Black Hills,
In
Scotch Whisky Ass’n v. Majestic Distilling Co.,
an American company sought trademark protection for a label bearing (i) the words BLACK WATCH, which is the name of a Scottish infantry regiment, (ii) a military regimental badge substantially identical to the badge of the Black Watch Regiment of Scotland, (iii) a thistle (which is the national symbol of Scotland), and (iv) the word “Highlander”.
That argument is squarely presented here. Forschner’s survey evidence suggests — and the district court has found — that Arrow’s use of the phrase Swiss Army knife is likely to cause consumer confusion as to the geographic origin of Arrow’s knife. The survey evidence and the district court’s factual finding notwithstanding, Arrow argues that the phrase Swiss Army knife is not a geographic designation and therefore cannot be deceptive as to geographic origin under § 43(a) of the Lanham Act. We agree. The phrase Swiss Army knife cannot fairly be read to say “made in Switzerland” so as to be geographically descriptive. Therefore, the use of the phrase by the distributor of a knife made in China does not constitute false advertising.
A geographically descriptive term or phrase is one that “designates geographical location and would tend to be regarded by buyers as descriptive of the geographic location of origin of the goods or services.” 1 J.T. McCarthy,
Trademarks and Unfair Competition,
§ 14.02. That a phrase or term
evokes
geographic associations does not, standing alone, support a finding of geographic descriptiveness.
5
The phrase or term must also “designate geographical location.” Therefore, even assuming (as the district court found) that consumers would tend to regard a Swiss Army knife as one originating in Switzerland, the phrase Swiss Army knife is not geographically descriptive within the meaning of the Lanham Act unless the phrase, considered as a whole, is a designation of geographic origin.
See California Cooler, Inc. v. Loretto Winery, Ltd.,
Our analysis is guided by the Supreme Court’s decision in Hamiltorir-Brown Shoe Co., which held that the use of the phrase THE AMERICAN GIRL on shoes manufactured in America was not geographically descriptive and was for that reason eligible for trademark protection without proof of secondary meaning:
We do not regard the words “The American Girl,” adopted and employed by complainant in connection with shoes of its manufacture, as being a geographical or descriptive term. It does not signify that the shoes are manufactured in America, or intended to be sold or used in America, nor does it indicate the quality or characteristics of the shoes.
Without deciding the unpresented issue of whether or not the phrase Swiss Army knife could have been exclusively appropriated as a trademark for a multifunction pocketknife if such an application had been made, we think it is clear that the phrase cannot be deemed a designation of geographic origin. If Victorinox or Wenger promoted a product as a “Swiss pocketknife,” the word “Swiss” could be said to denote geographic origin. We cannot, however, consider the word “Swiss” otherwise than as part of the phrase “Swiss Army.” The fact that a composite phrase contains a geographic term does not necessarily mean that the phrase, viewed as a whole, is a geographic designation. The question is whether
the phrase
can be construed to mean that the product is made in a certain locale.
Compare Canada Dry Ginger Ale, Inc. v. Lipsey,
As used in the phrase Swiss Army knife, “Swiss” is read more naturally to modify “Army” than “knife” — and probably does. The phrase Swiss Army knife therefore denotes a knife of the type associated with the Swiss Army, rather than a military knife manufactured in Switzerland. The district court’s findings support the view that “Swiss” modifies “Army” rather than “knife”:
— [T]he history of Swiss Army knives relates in part to the Swiss military, and American soldiers obviously drew a connection with the Swiss military when they began employing the name “Swiss Army knife.”
— [T]he Swiss military’s purchase of the knives has been a continuous boost to [the knives’] stature. This well-honed reputation seems to have been captured in the United States by the term “Swiss Army knife” when the knives gained renown upon the return of American soldiers from World War II.
Forschner,
The geographic origin cases relied upon by the district court are consistent with our analysis. In each of those cases, the word or words that modified the product could be (though need not be) construed to represent the product’s geographic origin.
See, e.g., Black Hills,
For these reasons, we hold that the phrase Swiss Army knife, as applied to a multifunction pocketknife manufactured outside Switzerland, is not a false designation of geographic origin.
2. Quality
The district court held that Arrow’s reference to its knife as a Swiss Army knife constitutes a misrepresentation of quality because a Swiss Army knife is necessarily one of high quality. This conclusion is in one sense a near-corollary of the district court’s holding that the phrase is geographically descriptive. Ordinarily, the reason that manufacturers promote and protect a geographical designation is because the origin assures in some measure qualities that the buying public has learned to value: the characteristics of agricultural products or ingredients; the techniques of artisans or designers; or the reputation and cachet of the producers in that place.
See California Apparel Creators v. Wieder of California, Inc.,
However, since we have held that the phrase Swiss Army knife is not geographically descriptive, use of the phrase cannot be deemed a representation of high quality solely because consumers associate high quality with Swiss companies and Swiss craftsmen. Nor can the term be deemed a representation of high quality solely because Vietorinox and Wenger produce high quality pocketknives, since that circular analysis would effectively confer upon Vietorinox and Wenger a species of trademark protection conditioned upon the maintenance of their quality controls. Moreover, the record does not disclose any system of grade, standard, or regulation employed as a touchstone for the quality of multifunction poeketknives, in Switzerland or elsewhere.
See California Apparel,
Forschner suggests that a standard of quality is implicit in Vietorinox’s status as a purveyor to the Swiss Armed Forces, and that Arrow’s use of the phrase Swiss Army knife therefore constitutes a misrepresentation of quality. This line of analysis is unworkable. First, since only Vietorinox and Wenger sell to the Swiss military, the phrase Swiss Army knife would not be available to any other company, even a Swiss manufacturer employing the utmost standards of quality. Second, “[although Vietorinox and Wenger produce a panoply of poeketknives, the Swiss military purchases only a relatively basic model_”
Forschner,
The assurance of quality found by the district court to inhere in the phrase Swiss Army knife is purely a function of what the district court deemed to be the geographical descriptiveness of that phrase, and does not furnish an independent ground for false advertising liability under § 43(a) of the Lan-ham Act, 15 U.S.C. § 1125(a)(1)(B).
B. 15 U.S.C. § 1125(a)(1)(A) — -Passing Off
Arrow argues that if the phrase Swiss Army knife is not geographically descriptive, it is nothing more than a generic phrase denoting any multifunction poeketknife. A generic phrase, Arrow continues, is in the public domain for all to use. Accordingly, Arrow urges that we direct the district court to dismiss the complaint if we conclude — as we do — that the phrase Swiss Army knife is not geographically descriptive. We are not prepared to do so.
A phrase or term that is not geographically descriptive is not necessarily generic. Moreover, a phrase or term that is indeed generic is not without protection under § 43(a) of the Lanham Act and New York common law. A judicial finding of genericness means only that courts will not recognize exclusive rights in the use of the generic phrase or term or impose trademark infringement liability upon subsequent users; such a finding does not close all avenues of relief. A manufacturer, for example, cannot use a generic term in a manner that constitutes a misrepresentation of manufacturer or source.
See Kellogg Co. v. National Biscuit Co.,
“A generic term is one that refers, or has come to be understood as referring, to the genus of which the particular product is a species.”
Abercrombie & Fitch,
Forschner, however, is not seeking trademark protection for the phrase Swiss Army knife. Count I of Forschner’s complaint points to Arrow’s claim that it was using “Swiss Army” as a trademark under license and alleges that this “is likely to cause consumers and the trade to believe that defendant’s knives are put out by, sponsored by or sold with the approval and/or authorization of a distributor of authentic Swiss made Swiss Army knives”, in violation of § 43(a) of the Lanham Act. Count III of the complaint alleges that “[t]he activities of [Arrow] and the dress of the knives offered by [Arrow] unfairly compete with Forschner and ... are part of a plan by defendant to trade upon the goodwill and enviable reputation of Forschner and the authentic Swiss Army knives imported, sold and promoted by Forschner,” in violation of New York common law. The district court had no occasion to address these causes of action, having determined that Forschner was entitled to relief on the false advertising claim asserted in Count II. Counts I and III, however, identify a separate danger — that consumers might mistake the Arrow knife for a multifunction pocketknife manufactured by Victorinox or Wenger. If there is a sufficient factual predicate for this allegation, injunc-tive relief is warranted irrespective of whether the phrase Swiss Army knife is generic.
Our determination that Arrow did not misrepresent the geographic origin or quality of its knife does not absolve Arrow of liability for other forms of misrepresentation or unfair competition, such as passing off: “The statutory prohibition against false designation of origin encompasses more than deceptions as to geographic origin; it extends, as well, to origin of source, sponsorship or affiliation.”
Societe Des Produits Nestle, S.A. v. Casa Helvetia, Inc.,
Courts typically grant relief, injunctive or otherwise, for misrepresentations as to the source of a product where a formerly exclusive trademark is no longer protectible because it has become generic.
See, e.g., Murphy Door Bed,
In
Kellogg,
the National Biscuit Company sought to enjoin the Kellogg Company from using the term “shredded wheat.” The Supreme Court found that “shredded wheat” is generic and that the National Biscuit Company therefore did not have an exclusive right to use it. Nevertheless, since the National Biscuit Company had historically been the sole manufacturer of shredded wheat, there was an undeniable association in the public mind between that company and the term “shredded wheat.” Accordingly, the Court recognized an obligation on the part of the Kellogg Company and other subsequent users “to use every reasonable means to prevent confusion,” although not to the point of refraining from use.
Kellogg,
The District of Columbia Circuit has summarized the Kellogg limitations on the use of generic terms, with emphasis on efforts by competitors to stimulate confusion or benefit from it:
If a consumer confuses two manufacturers’ shredded wheat cereal, for example, because both products share the same name and the consumer has a general appetite for crunchy, pillow-shaped wheat biscuits, there is no cause for judicial action. Such confusion results merely from the manufacturers’ concurrent use of a generic term to designate their products, and the late entrant into the shredded wheat field cannot be said to have engaged in unfair competition. If, however, the consumer associates “shredded wheat” with a particular manufacturer, perhaps because that manufacturer enjoyed a de facto (or de jure) monopoly for many years, there is a risk that the consumer may erroneously assume that any product entitled “shredded wheat” comes from that manufacturer. A second manufacturer may increase the risk of confusion by, for example, using a similar label, similar packaging, misleading advertisements, or simply by failing to state the product’s source. Only when there is a likelihood that the newcomer might thus pass its product off as the original manufacturer’s may a court require the newcomer to distinguish its product or to notify consumers explicitly that its product does not come from the original manufacturer.
Blinded Veterans Ass’n,
Assuming, arguendo, that the phrase Swiss Army knife is generic,
Kellogg
governs. A manufacturer such as Arrow cannot be prevented from using the phrase to denote its product.
See Liquid Controls Corp.,
Arrow’s use of the phrase Swiss Army knife is permissible only to the extent that such use does not engender a likelihood of confusion as to the source of Arrow’s product.
See Liquid Controls Corp.,
Since the district court did not address the claims of misrepresentation of source or unfair competition alleged in Counts I and III, respectively, we remand for consideration of whether or not Forschner has abandoned those claims and, if not, whether Forschner is entitled to relief under § 1125(a)(1)(A) or New York common law.
CONCLUSION
For the reasons set forth above, we vacate the order of the district court and remand for further proceedings consistent with this opinion.
Notes
. Arrow's survey went on to report that 51% of the relevant public believes that Swiss Army knife refers simply to a type of product. However, because of Arrow's improper survey methodology, this statistic was not credited by the district court.
Forschner,
. In 1992, the contents of former sections (1) and (2) of § 43(a) of the Lanham Act were redistributed into subsections (A) and (B).
. A geographically descriptive term acquires secondary meaning when consumers come to associate that term with one particular source and quality: "[G]eographical names often acquire a secondary signification indicative not only of the place of manufacture or production, but of the name of the manufacturer or producer and the excellence of the thing manufactured or produced.”
La Republique Francaise v. Saratoga Vichy Spring Co.,
. The Scotch Whisky Association "is a United Kingdom association of Scotch whisky distillers organized to promote interest in, and trade in, whisky produced in Scotland.”
Majestic Distilling,
. Conversely, a phrase or term that is merely evocative of a particular geographic origin
is
eligible for trademark status, even without proof of secondary meaning.
See Hamilton-Brown Shoe Co.,