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In Re Coin-Operated Audio-Visual Games and Components Thereof
No. 337-TA-87, 214 USPQ 217 (ITC 1981)

A complaint was filed against numerous competitors with the U.S. International Trade Commission by Midway Mfg. Co. alleging common law trademark infringement, passing off, imitation of trade dress, false designation of origin, and copyright infringement. The complaint sought cease and desist orders against domestics respondents and exclusion orders against international respondents. The products in question were coin-operated audiovisual games and components. Midway purchased from Namco exclusive rights to manufacture and sell within the United States “Galaxian,” a game introduced in Japan in 1979. The agreement prohibited any changes to the game itself and limited those pertaining to the game’s trade dress. An ITC attorney did an investigation, the results of which the court often notes. This decision was based purely on evidence produced by the claimant, so the findings were rebuttable.

Galaxian:


The court found that the term “Galaxian” was protectable as a common law trademark because it was arbitrary and distinctive in it stylization, lettering, and coloring, making it exempt from proving secondary meaning; it is also nonfunctional. After establishing these facts, Midway had to prove a likelihood of confusion to be successful on this claim. The court stated that the consuming public playing the game was irrelevant since they did not care who was the manufacturer, but instead focused on those companies and individuals purchasing consoles directly from the manufacturer. The court decided that those games using the word “Galaxian” did create a likelihood of confusion and infringed. The court also found that those games using “Galaxy” and “Galaxip” also infringed because of the similarity in the words along with the similarity in gameplay.

Regarding the claim of false designation of origin, the court found for Midway against those respondents that did not conspicuously present the manufacturer’s name on the screen and console.

The court also found that there was copyright ownership of the game. Midway proved originality since they purchased the rights from the creator Namco and validity by providing the copyright registrations. There was no direct evidence of copying, so the court examined whether there was prior access to Galaxian and substantial similarity between it and the other games. The alleged infringing games were released subsequent to trade show displays and the release of Galaxian, therefore, the court found that access existed. Determination of substantial similarity is much more difficult to quantify. The court cited the “ordinary observer” test where such a relationship is found when someone not attempting to discern disparities would regard the aesthetic appeal as the same. Another test cited was two-pronged, which first looks at the general ideas of the works, and second, examines the response of the ordinary and reasonable person. The court found that all but one game was nearly identical, and further found the remaining game substantially similar under both tests because of its rolling star background, shape and color of aliens, alien formation, movement of aliens while attacking, and scoring table.

There was clear evidence of damage to the Galaxian sales by Midway. The court found the in rem remedy of exclusion appropriate as it was created to overcome the problem of in personam remedies against foreign companies that have no offices or assets within the United States. The court granted an exclusion remedy directed at those games that clearly infringed on the common law trademark by using “Galaxian,” “Galaxy,” or “Galaxip.” Concerning the copyright claim, the court limited exclusion to those parties that have been specifically identified by the court as infringing. The reason for the limitation was to ease the process for Customs, as it would be exceedingly difficult to have them determine whether a game infringed on Midway’s copyright. The court denied the use of cease and desist letters to domestic respondents as they were all distributors and since no evidence of stockpiles existed, such a remedy would have been unnecessary given the exclusionary order.

Thanks to Adam Trost for his assistance in the preparation of this case summary.
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