Second Circuit Affirms PepsiCo’s Victory in “Rise” Trademark Dispute, Citing Weakness of the Mark and Lack of Confusion

RiseandShine Corp. v. PepsiCo, Inc., Case No. 23-1176-cv, 2024 U.S. App. LEXIS 32182 (2d Cir. Dec. 19, 2024)

The Second Circuit affirmed a summary judgment ruling in favor of PepsiCo, Inc., holding that its use of the term “Rise” in “MTN DEW RISE ENERGY” did not infringe on the trademark rights of RiseandShine Corporation, which markets nitro-brewed coffee under the “RISE” mark. The court determined that the “RISE” mark was inherently weak, had not acquired sufficient secondary meaning, and was unlikely to cause consumer confusion when compared to PepsiCo’s product branding. This decision emphasizes the role of mark strength and similarity in trademark disputes under the Lanham Act.

Case Background

RiseandShine Corp. markets canned coffee drinks under the brand “RISE.” It claimed that PepsiCo’s introduction of its energy drink “MTN DEW RISE ENERGY” in 2021 infringed its trademark, creating consumer confusion and damaging the brand’s market position.

The district court initially granted a preliminary injunction barring PepsiCo’s use of “MTN DEW RISE ENERGY,” but the Second Circuit vacated the injunction, finding that the “RISE” mark was inherently weak and lacked sufficient acquired distinctiveness. On remand, after full discovery, the district court granted summary judgment in favor of PepsiCo, concluding there was no likelihood of confusion. RiseandShine appealed.

Second Circuit’s Analysis

Strength of the Mark
The court analyzed the strength of the “RISE” mark, dividing it into two components: inherent strength and acquired distinctiveness (secondary meaning).

• Inherent Weakness: The court reaffirmed its earlier ruling that the “RISE” mark is inherently weak due to its descriptive association with coffee (e.g., “rising in the morning”). It emphasized that descriptive marks require substantial evidence of acquired distinctiveness to counteract this inherent weakness.
• Acquired Distinctiveness: While RiseandShine presented evidence of advertising expenditures and product recognition, the court found this insufficient to demonstrate that consumers associated “RISE” exclusively with its product. The absence of consumer surveys was particularly noted as undermining the claim of secondary meaning.

By emphasizing the lack of compelling evidence linking the “RISE” mark to its brand in consumers’ minds, the court concluded that the mark’s weakness strongly favored PepsiCo.

Likelihood of Confusion

The court evaluated the likelihood of confusion under the Polaroid factors, concluding that confusion was unlikely:

• Similarity of Marks: The court found the marks sufficiently distinct, with “MTN DEW RISE ENERGY” incorporating prominent “MTN DEW” branding that differentiated it from the standalone “RISE” mark.
• Relatedness of Products: While both products are caffeinated beverages, the court noted the different markets and branding strategies, further reducing the likelihood of confusion.
• Actual Confusion: RiseandShine’s evidence of confusion, primarily anecdotal accounts from industry professionals, was deemed minimal. The court highlighted the absence of consumer surveys, which could have provided stronger evidence.
• Intent: The court rejected allegations of bad faith, noting no evidence that PepsiCo adopted the “Rise” name to exploit RiseandShine’s goodwill.

The court reiterated that weak marks, such as “RISE,” are entitled to only narrow protection, and the other Polaroid factors did not sufficiently favor RiseandShine to support a claim of confusion.

Key Takeaways

• Descriptive Marks Face Significant Hurdles: Marks with inherent weaknesses, like those associated with descriptive terms, require robust evidence of secondary meaning to achieve broad protection.
• Consumer Surveys Are Critical in Trademark Litigation: The absence of surveys demonstrating consumer confusion significantly weakened RiseandShine’s claims.
• Brand Differentiation Matters: Prominent secondary branding, such as PepsiCo’s use of “MTN DEW,” can mitigate potential confusion even when marks share similar elements.

Conclusion

The Second Circuit’s decision in RiseandShine Corp. v. PepsiCo, Inc. highlights the challenges of enforcing rights to descriptive marks in crowded industries. By emphasizing the importance of mark strength and credible evidence of consumer confusion, the ruling provides a clear framework for evaluating trademark disputes under the Lanham Act.

To learn more about these issues, contact the author of this article, Arvind Jayakumar. Arvind is a brand protection attorney who counsels brands on how to prevent unfair competition, avoid unnecessary liability, and enforce their intellectual property rights. He has successfully litigated various commercial issues related to unfair competition, false advertising, trademark infringement, copyright infringement, breach of contract, and other business disputes. In addition to his litigation practice, Arvind boasts a robust trademark and copyright prosecution practice in which he helps brands register their intellectual property and secure IP rights.