Full opinion text
NON-CONFIDENTIAL FINDINGS OF FACT AND NON-CONFIDENTIAL CONCLUSIONS OF LAW JOAN N. ERICKSEN, District Judge. This matter came before the Court for trial starting on February 10, 2010, and ending on February 24, 2010, to determine whether use of the name CRISTALINO on cava produced by J. Garcia Carrión, S.A., (Carrión) and imported by CIV USA, infringes or dilutes the CRISTAL trademarks of Champagne Louis Roederer (Roederer). Based on the evidence received at trial, the Court makes the following Non-Confidential Findings of Fact and Non-Confidential Conclusions of Law. NON-CONFIDENTIAL FINDINGS OF FACT I.Sparkling wine 1. Still wine, or wine without bubbles, is made by a fermentation process that converts grape sugar into alcohol and carbon dioxide. The carbon dioxide in still wine is released by the wine producer after fermentation. 2. Sparkling wine, or wine with bubbles, is made using a second fermentation process that converts still wine into sparkling wine. According to the traditional method, also known as the “Method Champenoise” or “champagne method,” the second fermentation occurs in the bottle in which the sparkling wine is sold. The carbon dioxide is trapped in the bottle, dissolves into the wine, and escapes as bubbles when the sparkling wine is released from the bottle. According to the alternative “bulk” or “Charmat” method, the second fermentation takes place in a large tank or vat. After the second fermentation is complete, the contents of the tank are pumped into bottles for sale. The traditional method of producing sparkling wine results in higher-quality wine than the Charmat method. 3. Champagne and cava are both sparkling wines. When used properly, the term “champagne” denotes a sparkling wine made according to the traditional method from grapes grown in the Champagne region of France. A vintage champagne is made from grapes of the same year’s harvest. A non-vintage champagne is made from grapes of different years’ harvests. The term “cava” denotes a sparkling wine made in the Catalonia region of Spain. II. The U.S. sparkling wine market 4. The United States has a three-tier distribution system for alcohol, including wine. According to this system, a foreign wine producer sells wine to an importer. The importer then sells the wine to retailers, which are typically hotels, restaurants, and liquor stores. The retailers sell the wine to the consumer. Each tier sets its own price for the wine. Wine producers are prohibited by law from communicating directly with or selling directly to consumers, but an importer may communicate with its distribution network, including retailers. 5. The size of the U.S. sparMing wine market was relatively constant between 1995 and 2006. With the exception of 1999, sparkling wine consumption between 1995 and 2006 varied between 11.8 and 13.3 million cases. In 1999, sparkling wine consumption increased to 15.7 million cases due to the millennium celebration. The sparMing wine market peaks in May, June, November, and December because large numbers of celebratory events, including graduations, weddings, and holidays, occur during those months. 6. Most consumers who purchase wine, including sparkling wine, in liquor stores have only a cursory knowledge of wine. Despite the efforts of champagne producers to educate consumers about the differences between champagne and other sparkling wines, consumers continue to receive mixed messages about the meaning of “champagne” because some sparkling wines made outside the Champagne region of France identify themselves as “champagne.” Consequently, many consumers do not distinguish between champagne and other sparkling wines. 7. Consumers generally enter liquor stores with a price point and type of wine in mind. It is unusual for a consumer to purchase a wine at a price significantly different from the original price point. When inexperienced consumers purchase a more-expensive product, they educate themselves about the product by asMng the retailers questions. Consumers who purchase less-expensive bottles of wine ask fewer questions, although some will ask for guidance or discuss the wine regardless of price. 8. Many consumers purchase sparMing wine at different price points depending on the reason for the purchase. Consumers commonly purchase a less-expensive spar-Ming wine for large gatherings and a more-expensive sparMing wine for special occasions such as anniversaries, weddings, birthdays, and New Year’s Eve. In addition, consumers purchasing sparkling wine for a wedding reception may economize by purchasing a more-expensive sparkling wine for the wedding party and a less-expensive sparMing wine for the guests. 9. When purchasing wine in liquor stores, consumers are often hurried and make impulse purchases. They look for a wine they are familiar with based on prior consumption, advertising, newspaper or magazine articles, or word-of-mouth. Consumers rely on several cues when selecting a wine, including the name of the wine, the color of and fonts used on the labels, and the shape of the bottles. 10. Because consumers rely on labels, it is a common practice for a prestigious French winery to inform consumers of an affiliation or association between a less-expensive product and the winery by including the winery’s name or a portion of it on the front label of the less-expensive product. Moet & Chandon, which produces DOM PERIGNON champagne, labels its California sparkling wines with the name “CHANDON.” G.H. Mumm, which also produces a high-quality champagne, labels its California sparMing wines with “MUMM NAPA.” Chateau Mouton-Rothschild, which produces a Bordeaux wine that sells for approximately $200 a bottle, labels its less-expensive wines MOUTON-CADET. The similarity in the names informs consumers of the connection between the less-expensive product and the French winery. 11. The vast majority of sparkling wine is sold in green bottles that have concave bases. The front labels on most bottles of sparkling wine do not have gold as the background color. Rather, the background color can be one of any number of colors, including white, cream, black, yellow, red, brown, and blue. Many front labels include a distinguishing feature, such as a ribbon, stripe, or picture, in a contrasting color. Most front labels prominently display the winery’s name. It is common for rosé sparkling wines to have a pink front label, and a few rosé sparkling wines have a pink-hued copper front label. Gold neck labels with a medallion on the front of the label are extremely common in the sparkling wine market, and many of the neck labels extend downwardly to accommodate the medallion. The medallions vary from an elaborate shield or crest to a circle identifying the winery or the sweetness of the sparkling wine. It is common for the neck labels to have a stripe or ribbon in a different color at the base. “Shoulder labels,” or labels located between the front and neck labels, are rare. III. The parties and their products A. Champagne Louis Roederer 12.Roederer is a French company headquartered in Reims, which is in the Champagne region of France. Roederer is a family-owned business that was founded in 1776 by Nicolas Henri Schreider, the uncle of Louis Roederer. Louis Roederer took ownership of the company in 1826, at which time the company’s name changed to Champagne Louis Roederer. Jean-Claude Rouzaud, a member of the Roederer family, is the president of Roederer’s board of directors and its former chief executive officer. Members of the Roederer family make up the remainder of the board. In January 2006, Frederic Rouzaud, Jean-Claude Rouzaud’s son, became the chief executive officer and general manager of Roederer. Roederer employs between 140 and 150 people on a year-round basis and an additional 600 people during the two-week harvest season. 13. Roederer owns a winery located in Reims where it produces vintage champagnes under the names CRISTAL and CRISTAL ROSÉ. CRISTAL champagne was first produced in 1876 at the request of Tsar Alexander II of Russia. According to Roederer tradition, the champagne was named “CRISTAL” because it was sent to Tsar Alexander II in crystal bottles. 14. The size of Roederer’s vineyards and the quality of each year’s grape harvest limits Roederer’s production of CRISTAL champagne. Roederer only uses grapes from its own vineyards, and if the grapes in a year’s harvest are below the standard required for CRISTAL champagne, Roederer does not produce CRISTAL champagne that year. The quality of CRISTAL champagne is enhanced by various wine-making practices, including harvesting the grapes by hand and aging the wine for six years in oak casks. 15. * * *. In 1995, Roederer sold * * * bottles of CRISTAL champagne in the United States. Roederer sold * * * bottles and * * * bottles in the United States in 2000 and 2004, respectively. With the exception of 2009, the demand for CRISTAL champagne has always exceeded its supply. An economic downturn caused the decreased demand for CRISTAL champagne in 2009. 16. Liquor stores typically sell CRIS-TAL champagne for between $200 and $280 per bottle. Restaurants, hotels, and nightclubs generally sell CRISTAL champagne for between $300 and $700 per bottle. 17. Roederer produces other champagnes, including BRUT PREMIER, BRUT VINTAGE, ROSÉ VINTAGE, and BLANC DE BLANCS champagne. CRISTAL and BRUT PREMIER champagne make up about 20% and 75% of Roederer’s champagne production, respectively. Roederer’s other champagne products account for the remainder. BRUT PREMIER champagne sells for between $40 and $50 per bottle in liquor stores and BRUT VINTAGE champagne sells for about $75 per bottle in liquor stores. 18. Roederer also owns the Roederer Estate winery in California’s Anderson Valley, which it purchased in 1981 because there was no room to expand in the Champagne region of France. Roederer selected the Roederer Estate vineyards in the Anderson Valley because the “terroir,” or microclimate, resembled that of the Champagne region. It presents Roederer Estate as “the California out-post of Champagne Louis Roederer” and chose the name “Roederer Estate” to increase the success of its California sparkling wines by linking them to the Roederer name. Roederer considered using the name “CRISTALINO” for its Roederer Estate products, but decided against it because Jean-Claude Rouzaud believed it would dilute the image of CRISTAL champagne. 19. Roederer Estate produced its first wines in 1988. The Roederer Estate winery produces ROEDERER ESTATE BRUT and ROEDERER ESTATE BRUT ROSÉ sparkling wine, along with ROEDERER ESTATE L’ERMITAGE and ROEDERER ESTATE L’ERMITAGE ROSÉ “prestige” sparkling wine. Roederer does not identify its Roederer Estate sparkling wines as “champagne” because they are made from grapes grown in California, not the Champagne region of France. A bottle of ROEDERER ESTATE sparkling wine sells for about $20 in liquor stores. Roederer sold * * * cases of ROEDERER ESTATE sparkling wine in 2007 and expects sales to increase to * * * cases by 2012. 20. About six years ago, Roederer acquired the Seharffenberger Cellars winery, which is also located in the Anderson Valley. Seharffenberger Cellars sparkling wines are made using a different method and have a different “style” than Roederer and Roederer Estate wines. Roederer does not promote any connection between Seharffenberger Cellars wines and Roederer. 21. Maisons, Marques & Domaines (MMD) is the importer and distributor for Roederer in the United States. Roederer owns approximately 95% of MMD and MMD management owns the remainder. MMD represents twenty-six wine producers, half of which Roederer owns. B. Defendants 22. Carrión is a Spanish corporation that produces and markets wines and fruit juices. In 2009, Carrión made 800 million liters of juice and wine, about 60% of which were juice and 40% were wine. Priesca, S.A., owns Carrion’s stock. The Garcia-Carrión family owns 75% of Pries-ca’s stock and local banks own the remaining 25%. 23. In April 1997, Priesca purchased the stock of Jaume Serra, S.A., a Spanish winery founded in 1943. In August 1998, Jaume Serra merged with Carrión. The merged entity operates under the name “J. Garcia Carrión.” 24. The Jaume Serra winery, which is located in Vilanova y la Geltru, Spain, produces still wines and cava. Jaume Serra produced a still wine under the name CRISTALINO in the 1950’s and another still wine under the name CRISTALINO in 1979. Jaume Serra began selling cava under the name CRISTALINO some time before 1987. Carrion currently sells cava under the name CRISTALINO and the name JAUME SERRA. CRISTALINO cava is made according to the traditional method and is aged at least eighteen months before sale. Bottles of Carrion’s cava are not labeled until shortly before they leave the winery. 25. In connection with the 1997 merger, Carrion upgraded the Jaume Serra winery to expand its capacity and decrease production costs. The upgrade included installing a new wine cellar, new lines, and new production robots. This upgrade did not change the manufacturing process for CRISTALINO cava. 26. Jaume Serra began importing CRISTALINO cava into the United States in 1989. In 1992, Jaume Serra sold just over 10,000 bottles of CRISTALINO cava in the United States. In 1997, 384,864 bottles of CRISTALINO cava were sold in the United States, which increased to 689,-076 bottles in 2000. In 2004, Carrion sold just over 2 million bottles of CRISTALINO cava in the United States, and by 2009, Carrion’s U.S. sales had increased to slightly over 4 million bottles. Carrion’s sales of CRISTALINO cava in the United States make up 90% of its U.S. wine sales. Between 75% and 80% of CRISTALINO cava sold in the United States is CRIS-TALINO BRUT. In 2002, Carrion began selling significant amounts of CRISTALINO ROSÉ cava in the United States. CRISTALINO cava typically sells for between $8 and $10 per bottle in liquor stores and between $19 and $32 per bottle in restaurants. Defendants have maintained the price of CRISTALINO cava at no more than $10 per bottle in liquor stores for several years, despite inflation and an unfavorable exchange rate. 27. CIV USA, Inc., is a consortium of Spanish wineries that promotes and distributes Spanish wines in the United States. Jaume Serra joined CIV USA in 1991. Also in 1991, Friend Wine Marketing d/b/a CIV USA was incorporated to facilitate the process of obtaining an import license from the U.S. Bureau of Alcohol, Tobacco, and Firearms (BATF). Vince Friend is the president and sole shareholder of Friend Wine Marketing. Carrion took Jaume Serra’s place in CIV USA after the 1997 merger. IV. Trademarks A. Roederer’s marks 28. Roederer owns U.S. Trademark Registration No. 662,343 for CRISTAL CHAMPAGNE & Design for use in connection with champagne. The '343 mark was registered on the Principal Register on May 27, 1958. Roederer disclaimed the words “CRISTAL CHAMPAGNE” apart from the mark as shown in the registration. 29. Roederer also owns U.S. Trademark Registration No. 1,163,998 for the word mark CRISTAL CHAMPAGNE for use in connection with champagne. The '998 mark was registered on the Principal Register on August 4, 1981 under Section 2(f) of the Lanham Act, 15 U.S.C. § 1052 (2006). Roederer disclaimed the word “CHAMPAGNE” separate and apart from the mark as shown. Roederer filed an affidavit of incontestability for the '998 mark in 1987, which the U.S. Patent & Trademark Office accepted in 1989. 30. The '998 and '343 marks have dates of first use in commerce of March 25, 1937. In 1948, Roederer sold * * * bottles of CRISTAL champagne in the United States, and sales have occurred continuously since that date. Sales of CRISTAL champagne in the United States increased from * * * bottles in 1960 to * * * bottles in 1969. Roederer sold * * * bottles of CRISTAL champagne in the United States in 1979 and * * * bottles in the United States in 1989. In 2004, Roederer sold * * * bottles of CRISTAL champagne in the United States. Roederer has continuously used in commerce the CRISTAL mark in connection with champagne in the United States since at least 1948. 31. The appearance of bottles of CRISTAL champagne has not significantly changed since CRISTAL champagne’s creation in 1876. The following image depicts a present-day bottle of CRISTAL champagne. 32. The bottle is clear and, unlike most other sparkling wine bottles, has a flat base. The front label is rectangular, gold, and features a large white “LR” medallion on its center with a stylized design of white curved lines underneath the medallion. The vintage year is printed in maroon over the LR medallion. “CRISTAL®” appears on the upper left side of the LR medallion and “CHAMPAGNE” appears on the upper right side of the LR medallion, both printed in a maroon Roman serif font. “CRISTAL®” is printed in white beneath the LR medallion and “LOUIS ROEDERER” is printed in maroon above the LR medallion. “BRUT” is printed in maroon on the bottom left of the LR medallion, and the volume and percent alcohol by volume is printed in maroon beneath “BRUT.” “REIMS” and “PRODUCT OF FRANCE” are printed in maroon on the bottom right of the LR medallion. 33. A gold shoulder label depicts the Imperial coat of arms flanked on both sides by the initials “L.O.R.” in maroon. Gold engraving circumscribes the shield and the initials. 34. The neck label is gold. A smaller white LR medallion is located on the front and “CHAMPAGNE” is printed above the small LR medallion in white on a maroon ribbon. “LOUIS ROEDERER” is printed underneath the small LR medallion, also in white on a maroon ribbon. The smaller LR medallion and LOUIS ROEDERER are located in a downwardly-extending portion of the neck label. “CRISTAL” is horizontally embossed in maroon above the smaller LR medallion. An LR monogram is embossed in maroon above the word “CRISTAL.” The word “CRISTAL®” is also printed in maroon on both sides of the neck label approximately parallel to the smaller LR medallion and printed in white beneath the smaller LR medallion. An LR monogram is embossed in maroon on the back label. “MAISON FONDÉE EN 1776” and a very small LR monogram are printed in maroon on the back of the neck label directly opposite the smaller LR medallion. Gold engraving circumscribes the neck label. 35. The back label depicts the Imperial coat of arms flanked by the initials “L.O.R.” on either side in maroon. “CRISTAL®” appears on the left side of the back label, and the remainder of the label provides a government warning, lists the address of Roederer’s website, and states that the product was imported by MMD. 36. The use of the CRISTAL marks on bottles of CRISTAL ROSÉ champagne is very similar to their use on bottles of CRISTAL champagne. The CRISTAL ROSÉ champagne labels are a pink-hued copper color rather than the gold of CRISTAL champagne labels. The words “BRUT ROSÉ,” rather than “BRUT,” are printed in maroon on the bottom left of the LR medallion, and the words “MARQUE DÉPOSÉE” are printed in maroon at the top of the front label. 37. Bottles of CRISTAL and CRIS-TAL ROSÉ champagne are wrapped in yellow cellophane and packaged in gold boxes bearing a large LR medallion on their front. When displayed in liquor stores, the bottles are kept in the yellow cellophane because it prevents ultraviolet light from penetrating the clear bottle and degrading the quality of the champagne. 38. In 2008, Roederer redesigned the labels of its non-CRISTAL champagnes. The following image depicts the redesigned BRUT PREMIER bottle and label. 39. The BRUT PREMIER bottle is green with a concave bottom. The front label is light gold and bordered by maroon and gold lines. A gold LR monogram is centered on the front label, over which “LOUIS ROEDERER” is printed in large, all-capital maroon letters. “CHAMPAGNE” is centered beneath “LOUIS ROEDERER” in smaller all-capital maroon letters. As with the bottle of CRIS-TAL champagne, “BRUT” is printed in the lower left-hand corner and “REIMS” is printed in the lower right-hand corner of the front label. “BRUT PREMIER” is printed above the LR monogram on the front label, and “MAISON FONDÉE EN 1776” is printed in very small gold letters on the top of the maroon border. 40. The BRUT PREMIER bottle does not have a shoulder label. The neck label states “ROEDERER” in vertical maroon letters. The lower part of the neck label is virtually identical to the lower part of the CRISTAL neck label, including the white medallion with the gold LR monogram and trim. The neck label states “LOUIS ROEDERER,” rather than “CRISTAL,” on either side of the white medallion. 41. The labels of Roederer’s other champagnes are similar to the BRUT PREMIER label. They include an LR monogram on the front label and a white LR medallion on the front of the neck label. The use of the LR monogram on the front labels and the white LR medallion on the neck labels of Roederer’s nonCRISTAL champagnes links those champagnes with CRISTAL champagne. 42. Prior to 2008, the bottles of Roederer’s non-CRISTAL champagnes had a maroon, rather than white, LR medallion on the neck label. The medallion was larger and more ornate. The pre-2008 labels did include elements common to the CRISTAL champagne label, including the LR monogram on the front label and the prominent display of the LOUIS ROEDERER name on the front label. 43. As seen in the following image, ROEDERER ESTATE sparkling wine is sold in a green bottle. The bottle has a concave base. 44.The ROEDERER ESTATE label is brown and has a gold border. It is generally rectangular with an arch at the top. “ROEDERER ESTATE” is printed in all-capital yellow letters on the center of the front label. “ANDERSON VALLEY BRUT” and “ESTATE BOTTLED SPARKLING WINE” are printed in smaller gold letters beneath “ROEDERER ESTATE.” 45. The neck label extends downwardly at the front. An “RE” monogram is printed in maroon and gold on the downwardly-extending portion of the neck label in a location corresponding to the location of the white LR medallion on the neck labels of Roederer champagnes. The RE monogram is topped by an eagle and surrounded by grapevines, both printed in gold. A gold ribbon stating “ROEDERER ESTATE” is located beneath the RE monogram. “ROEDERER ESTATE” is vertically printed in gold on the front of the neck label and horizontally printed in maroon on either side of the RE monogram. 46. Another RE monogram is printed on the back of the neck label, encircled by the words “ROEDERER ESTATE ANDERSON VALLEY.” “ROEDERER ESTATE” is vertically printed in gold letters on the back of the neck label. 47. The bottles and labeling of ROEDERER ESTATE ROSÉ and ROEDERER ESTATE L’ERMITAGE sparkling wine are similar to those of ROEDERER ESTATE sparkling wine. The ROEDERER ESTATE L’ERMITAGE label is dark gray with the word “L’ERMITAGE” centered above the name ROEDERER ESTATE. An RE monogram and shield are formed in the shoulder of the bottle. The labels on bottles of ROEDERER ESTATE ROSÉ and ROEDERER ESTATE L’ERMITAGE ROSÉ sparkling wine are a pink-hued dark copper. B. Carrion’s marks 48. In 2000, Carrion sought registration of the CRISTALINO mark in connection with alcoholic beverages (excluding beer) in International Class 33. Carrion did not conduct any formal or informal searches or investigations before seeking registration of the CRISTALINO mark. In June 2002, after the mark was published for opposition, Roederer sent a letter to Carrion informing it of Roederer’s rights in the '343 and '998 marks and asking Carrion to withdraw its application for registration and agree not to use the CRISTALINO mark for wine, sparkling wine, and champagne. Carrion did not respond to the letter or inform Friend of its existence. Roederer subsequently opposed registration of the CRISTALINO mark. 50.The bottle is green and has a concave bottom. The front label is a gold rectangle with a black bottom edge. “CRISTALINO” is printed in black Roman serif type on the center of the front label. A black line is located underneath “CRISTALINO” and a gold medallion with an image of a bunch of grapes is located immediately above “CRISTALINO.” “METODO TRADICIONAL” is printed in smaller burgundy letters beneath the word “CRISTALINO.” “BRUT” is printed in larger letters in black beneath the words “METODO TRADICIONAL.” “CAVA” is printed in burgundy on the bottom right-hand corner of the label. The bottom left-hand corner of the label states in burgundy “SPARKLING WINE FERMENTED IN THIS BOTTLE.” Two borders extend around the perimeter of the front label. The burgundy inner border is comprised of grape leaves and grape bunches. A second border of two gold lines encloses the border of grape leaves and grape bunches. The name “CRISTALINO” is the dominant element of the front label. 51. On the black bottom edge, which is outside the borders, the label states in very small letters “Produced by: Jaume Serra / PRODUCE OF SPAIN,” provides the address of the Jaume Serra winery, and states “IMPORTED BY: CIV (USA), SACRAMENTO, CA.” The alcohol by volume is printed on the left side of the black edge and the volume of the bottle is printed on the right side of the black edge. 52. A circular sticker having a black center and gold edging is located on the shoulder of the bottle. “Wine & Spirits Magazine” is printed in gold on the sticker’s center and “Value Brand of the Year 3 Consecutive Years” is printed in black on its edging. 53. The neck label is gold and extends downwardly in the front. A bunch-of-grapes medallion is located in the downwardly-extending region of the neck label. “CRISTALINO” is vertically printed in black on the front of the neck label. The bottom of the neck label is edged with highly-reflective gold. The back of the neck label is blank. 54. Another label is located on the back of the CRISTALINO bottle. Within a two-line gold border, the name “CRISTALINO” is printed in all-capital black letters. The word “BRUT” appears beneath “CRISTALINO,” separated by a black line. Underneath the word “BRUT,” the label states that the second fermentation of the cava took place in the bottle, advertises the eava’s “soft scent of toast and dry, fingering citrus qualities on the palate,” and describes CRISTALINO cava as “a clean bubbly that is sophisticated enough for just about any meal — as well as your next celebration.” The surgeon general’s warning and a bar code are located on the bottom of the back label, outside of the gold border. 55. The CRISTALINO ROSÉ label is virtually identical to the CRISTALINO label, except that it is.,a pink-hued copper color. The CRISTALINO ROSÉ bottle is clear and has a concave bottom. “ROSÉ BRUT” appears in black beneath the “CRISTALINO” name on the front label, and the center of the Wine & Spirits sticker is pink instead of black. 56.Although the bottles used for CRISTALINO cava have always been green, the CRISTALINO label has changed significantly since its introduction in 1989. The 1989 version of the CRIS-TALINO label is shown in the following black-and-white copy of the 1989 BATF application. 57.In 1989, the front label of CRIS-TALINO BRUT was gold. “CRISTALINO” was centered on the front label in large all-capital letters. “JAUME SERRA” was printed in all-capital letters immediately below “CRISTALINO.” The JAUME SERRA was smaller than the CRISTALINO. A design of curly lines surrounded the words “CRISTALINO JAUME SERRA,” and the words “BRUT” and “SPARKLING WINE PRODUCT OF SPAIN” were vertically stacked above the word “CRISTALINO.” “METHODE CHAMPENOISE” and “METHODE TRADITIONNELLE” were printed beneath JAUME SERRA, and CAVA was printed in large letters beneath those phrases. 58. “CRISTALINO JAUME SERRA” was centered at the top of the back label, which included a description of the in-the-bottle second fermentation and grapes used to produce the cava. “CRISTALINO” was printed on the center of the neck label, with “JAUME SERRA” on the right and “CRISTALINO” on the left. “BRUT” was printed on the neck label above “CRISTALINO.” The back of the neck label included a crest surrounded by the words “CRISTALINO JAUME SERRA.” The 1989 CRISTALINO bottle prominently featured the JAUME SERRA name on the front, back, and neck labels. 59. Jaume Serra updated the CRIS-TALINO labels in 1991. A copy of the BATF application for the 1991 label is shown below. 60. The name “CRISTALINO” was centered on the front label and the name “JAUME SERRA” printed beneath it. The phrases “METHODE CHAMPENOISE” and “METHODE TRADITIONNELLE” were located in smaller font between “CRISTALINO” and “JAUME SERRA.” The bunch-of-grapes medallion found on the label today was added to the label above the name “CRISTALINO.” The back label continued to prominently feature the name “CRISTALINO JAUME SERRA.” 61. The bunch-of-grapes medallion was centered on the neck label with a ribbon identifying the sweetness of the cava beneath it and “CRISTALINO” above it. The right and left sides of the neck label both read “JAUME SERRA.” A medallion including the name “JAUME SERRA” was located on the back of the neck label. The CRISTALINO BRUT labels were black. The CRISTALINO DRY and SEMI-DRY labels were gold. Again, the 1991 labels emphasized the JAUME SERRA name. 62.In 1993, Carrion again changed the CRISTALINO cava labels, as shown in the following reproduction of the BATF label application. 63. The 1993 CRISTALINO BRUT labels were very similar to the current labels, except that 1993 labels were black instead of gold. The front label included the CRISTALINO name, bunch-of-grapes medallion, border, and words “BRUT” and “CAVA” found on the front label today. “METHODE TRADITIONNELLE” and “METHOD CHAMPENOISE” were printed underneath “CRISTALINO” in the location where “METODO TRADICIONAL” is printed today. “SPARKLING WINE” was printed above the medallion. The winery and import company information was located at the bottom edge of the front label and outside the borders, just as it is today. 64. With the exception of the language describing the cava, the back label is virtually identical to the current back label. The neck label included the bunch-of-grapes medallion encircled by “CRISTALINO.” The word “BRUT” appeared on a ribbon beneath the bunch-of-grapes medallion, and the Jaume Serra crest appeared, including the name “JAUME SERRA,” on the back of the neck label. 65. The 1993 labels de-emphasized the “JAUME SERRA” name by removing it from the main portion of the front label. Friend credibly testified that “JAUME SERRA” was removed because the pre1993 labels were “busy” and “confusing” and the name “Jaume Serra” was difficult for U.S. customers to pronounce. 66. Friend further testified that a buyer at the Wine Max store in San Francisco indicated in 1994 that he would purchase five cases of CRISTALINO BRUT cava if the label was changed from black to the gold label used by CRISTALINO EXTRA-DRY cava because there was no market for CRISTALINO EXTRA-DRY cava but he could sell CRISTALINO BRUT cava if the label was gold. Friend believed that other retailers would agree with the Wine Max buyer’s opinion. He thought the change was worthwhile because a purchase of five cases represented a commitment to the product on the part of the retailer and he could use the Wine Max buyer’s purchase of five cases to persuade other retailers to stock CRISTALINO cava. As a result, the CRISTALINO BRUT label was changed from black to gold. 67. In the mid-1990’s, Jaume Serra changed the phrases “METHODE TRA-DITIONNELLE” and “METHODE CHAMPENOISE” to “METODO TRADI-CIONAL” to conform to European Community regulations. C. The meaning of the marks 68. “CRISTAL” is not a common word in English. The English translation of “CRISTAL” is “crystal,” which means “quartz that is transparent or nearly so and that is either colorless or only slightly tinged.” Webster’s Third New International Dictionary 548 (2002). When used in the United States, the word “CRIS-TAL” refers to a proper name, a geographic location, or Roederer’s CRISTAL champagne. U.S. consumers pronounce “CRISTAL” with a long “e” in the first syllable and the accent on the second syllable. 69. “CRISTALINO” is not a common word in English. The English translation of “CRISTALINO” is “crystalline,” which means “made of crystal” or “resembling crystal as transparent, pure, pellucid.” Id. at 549. When spoken by U.S. consumers, the first syllable is pronounced with a short “i” and the accent is on the third syllable. 70. “CRISTAL” is a generally meaningful word, or morpheme. English speakers recognize the suffix “INO” as conveying a diminutive, i.e., a smaller or lesser, meaning or a “related to” meaning. The addition of the suffix “INO” to the root word “CRISTAL” to form “CRIS-TALINO” suggests to English speakers that CRISTALINO is a diminutive of or somehow associated with the root word CRISTAL. 71. In recent years, the media has recognized the verbal association between “CRISTALINO” and “CRISTAL” by suggesting that those who cannot afford CRISTAL champagne should instead purchase CRISTALINO cava and describing CRISTALINO cava as “the other CRIS-TAL.” In addition, a number of Internet postings indicate that consumers purchase CRISTALINO cava because the name sounds like “CRISTAL.” Some of those posts describe CRISTALINO cava as CRISTAL’s “younger brother.” D. Similar marks 72. Marks including the terms “cristal,” “crystal,” “krystal,” or some variant (CRISTAL or similar terms) have been registered for use in connection with a number of products. A 1988 search of U.S. trademark registrations indicates that there were about sixty registrations or applications for registrations for marks using CRISTAL or similar terms in connection with alcoholic and non-alcoholic beverages. Some of the applications for registration were abandoned. Also in 1988, trade names including CRISTAL or similar terms were listed in trade directories in connection with alcoholic and nonalcoholic beverages. Defendants introduced no evidence of the geographical extent or volume of sales of the products sold under those marks or trade names. 73. In 1995, CRYSTAL LAKE wine (including “California champagne”), CRYSTAL GEYSER mineral water, AUGUARDIENTE CRISTAL liquor, STOLICHNAYA CRISTALL vodka, CRYSTAL LIGHT soft drinks, and CRISTALINO sparkling wine were available for purchase in California. 74. A 2009 search of U.S. trademark registrations identified registrations for marks using CRISTAL or similar terms for a number of products, about forty of which were alcoholic beverages. Many of those registrations were related. For example, there were registrations for over fifteen variants of the “CRISTALL” mark for use in connection with vodka. In addition, an Internet search located approximately forty products using CRISTAL or similar terms, including rum, vodka, salt, and bottled water. Defendants introduced no evidence of the geographical extent or volume of sales of the products sold under the registered marks or names. Several of the products located on the Internet were not available for sale from the website on which they were found. Ten of the products found on the Internet were wines, but none of them had labels that were gold or otherwise resembled the CRISTAL labels. Based on the evidence received at trial, some of the wines did not display the CRISTAL or similar terms on their labels or bottles. 75. Roederer has enforced its trademark rights against those using CRISTAL or similar terms in connection with champagne and sparkling wine, but does not enforce its trademark rights against every product having CRISTAL or similar terms in its name. In 1988, Roederer sent a cease-and-desist letter to an entity marketing an American sparkling wine under the name “California Crystal.” In 1998, Roederer unsuccessfully opposed the registration of “CRYSTAL CREEK” for use in connection with wine. The United States Court of Appeals for the Federal Circuit affirmed the Trademark Trial and Appeal Board’s finding of no likelihood of confusion based on “the dissimilarity of the marks with respect to appearance, sound, significance, and commercial impression.” Champagne Louis Roederer, S.A. v. Delicato Vineyards, 148 F.3d 1373, 1374-75 (Fed.Cir.1998). In 2004, Roederer halted the sale in the United States of cava marketed under the name “CRISTAL CAVA CASTELLBLANCH” by Castellblanch S.A. and Victore Imports Company. V. Marketing and trade channels A. Recognition, advertising, and promotion of CRISTAL champagne 76. Roederer is considered one of the finest champagne houses in the world. CRISTAL champagne was known in the United States as one of the best champagnes by wine connoisseurs and those knowledgeable about wine at least as early as the 1970’s. The quality of CRISTAL champagne continues to be recognized today. For example, in December 2009, CRISTAL champagne received a 100-point rating from Wine & Spirits magazine. The recognition of CRISTAL champagne as one of the best champagnes by those knowledgeable about wine is unquestionable. 77. CRISTAL champagne is made with a sophisticated consumer or wine connoisseur in mind. However, not all consumers of CRISTAL champagne are sophisticated or wine connoisseurs. Some consumers purchase CRISTAL champagne because they appreciate its quality. Others, including celebrities, purchase CRISTAL champagne for the social recognition it brings. 78. CRISTAL is Roederer’s “flagship” brand. The reputation of CRISTAL champagne helps persuade distributors and retailers to carry other Roederer and Roederer Estate products and permits Roederer to sell its other products at a premium price. Displaying CRISTAL champagne in a liquor store adds to the prestige of the store, and retailers actively market CRISTAL champagne for this reason. However, only a small percent of consumers know that Roederer produces CRISTAL champagne. Consequently, while CRISTAL’s reputation provides certain benefits within the industry to Roederer and its other products, its influence on consumer perception of the Roederer brand is attenuated. 79. “Aspirational” brands convey a certain image that people aspire to share. By their very nature, aspirational brands are known by those who do not actually purchase or consume the branded product. For example, the ROLEX brand projects an image of success that consumers seek to display by wearing a ROLEX watch. Some who cannot afford a ROLEX watch aspire to do so in the future in the hopes of projecting a successful image. Consumers purchase CRISTAL champagne because it projects a sense of quality, elegance, prestige, glamour, and status. To maintain the image of the CRISTAL brand, Roederer prices CRISTAL champagne higher than DOM PERIGNON champagne and portrays CRISTAL champagne as a work of art. The CRISTAL brand is an aspirational brand and its audience is larger than those who consume CRISTAL champagne. 80. In 1998, Roederer adopted the slogan “Without Compromise” for its products, which it utilized in two to three campaigns over a period of several years. The campaign featured BRUT PREMIER champagne and was intended to advertise the Roederer brand by focusing on the LR monogram. The Without Compromise advertisements were published in Roederer’s L’Officiel newsletter in 2001, 2002, and 2003. Roederer publishes about 50,000 copies of L’Officiel annually in several different languages. Copies of the newsletter are sent to Roederer’s distributors, including Roederer’s U.S. distributors, who then provide them to customers, journalists, and liquor stores. In 2006, Roederer placed brightly-colored Without Compromise advertisements inspired by Andy Warhol and an advertisement highlighting the name Roederer and its founding year (1776) in the New York Times, Wine News, Quarterly Review of Wine, Wine & Spirits, Wine Enthusiast, and Wine Spectator. 81. In 2009, Roederer adopted an “Artistry of Champagne” slogan for its advertising. The five Artistry of Champagne advertisements feature an abstract depiction of a champagne bottle, the front label of the champagne, and an LR monogram on the neck in the same location as that of the smaller white LR medallion on the neck of an actual bottle. The labels shown include those of CRISTAL, BRUT VINTAGE, BRUT PREMIER, and BLANC DE BLANCS champagne. The 2009 Artistry of Champagne advertisements showing CRISTAL champagne appeared in the New Yorker, Pebble Beach publications, a catalog for a classic motorcar show, a catalog for a horse show, and the December 2009 issue of Wine & Spirits. 82. Prior to 2009, Roederer’s policy was not to promote CRISTAL champagne. Roederer had two reasons for this policy. First, advertising was unnecessary because Roederer sold every bottle of CRISTAL champagne it produced. Second, Roederer believed advertising CRISTAL champagne would make it seem like an ordinary product. On occasion, however, distributors promote the CRISTAL brand with Roederer’s permission, and retailers prominently feature CRISTAL champagne in their advertisements. Roederer donates CRISTAL champagne to about twenty charitable events and festivals in the United States on an annual basis. Roederer also sends samples of CRISTAL champagne to journalists at Cooking Light, Quarterly Review of Wine, Wine & Spirits, Gourmet, Bon Appétit, and similar publications, as well as to newspaper journalists in major metropolitan areas. 83. CRISTAL champagne has enjoyed unsolicited publicity for several decades. Between 1950 and 1989, CRISTAL champagne was mentioned in 140 newspaper articles, and between 1990 and 1993, it was mentioned in an additional 67 newspaper articles. Newspapers that published articles mentioning CRISTAL champagne during that time include the New York Times, San Francisco Globe, San Francisco Chronicle, Los Angeles Times, and Miami Herald. The vast majority of the newspaper articles mentioned CRISTAL champagne either in connection with a special event at which CRISTAL champagne was served, as one of several champagnes in an article about sparkling wine, or in a description of the expensive or extravagant lifestyle of a particular celebrity. 84. For example, one article published in several newspapers in December 1989 recommended serving champagne when entertaining over the holidays. That article characterized “Louis Roederer” as one of “America’s favorite French champagnes” and then briefly described Roederer’s CRISTAL and BRUT PREMIER champagne. The remainder of the article was an appetizer recipe. On March 5, 1989, the New York Times mentioned that CRISTAL ROSÉ champagne was served as the dessert wine to President Ronald Reagan at Le Cirque, and on January 20, 1983, the Palm Beach News published an article describing a lunch with President Richard Nixon and mentioning that CRISTAL champagne was served 85. Only a few of the articles were directed to Roederer or CRISTAL champagne. One such article was published in the San Francisco Globe in 1954. This article highlighted the visit of the chief executive of Roederer to introduce the 1949 vintage of CRISTAL champagne. 86. In 1979, the Los Angeles Times published an article on champagne describing Roederer’s products, including CRIS-TAL champagne, and an article in the New York Times Magazine in 1979 described CRISTAL champagne as the most expensive champagne available. The Los Angeles Times published the results of the Wine & Cheese Festival rankings in 1970, in which CRISTAL champagne was rated the Grand Champion. In 1979, the Fresno Bee described a champagne dinner at which several Roederer champagnes were served, including CRISTAL champagne. Edward McCarthy, the author of Champagne for Dummies and a wine expert, testified that CRISTAL champagne’s reputation in the field of wine and champagne was “singular” and had been since at least the early 1970’s. 87. Between 1950 and 1989, CRISTAL champagne was mentioned in seventeen magazines, and between 1990 and 1993, in another six magazines. Many of those magazines were special-interest magazines such as Food & Wine and Wine Spectator. When CRISTAL champagne was mentioned or featured in a general-interest magazine such as Vogue, W, or Bazaar, it was generally mentioned in connection with entertaining or travel and as one of several products. In 1985, CRISTAL champagne was displayed on the cover of Bride’s in a wine cooler next to two champagne flutes. Only the neck label was visible. Elle featured a bottle of CRISTAL champagne on its cover along with a number of other luxury goods in May 1989. Only the neck and shoulder labels were visible. In 1973, Time published an article describing President Nixon’s dinner with Leonid Brezhnev, the General Secretary of the Communist Party of the Soviet Union. The first line of the article read: “The fear has been buried in champagne toasts (Roederer Cristal) and broad presidential smiles and the haunting strains of Tchaikovsky by the Marine Band.” The other nine paragraphs described the dinner and its political significance. 88. CRISTAL champagne was featured as a product placement in the movies Heartburn, Star 80, and In the Money. All of those movies were released before 1990. 89. In 1987, Andrew Jones, the “Flying Wine Man,” hosted local radio shows on 135 stations in 20 states explaining champagne and featuring ten brands. During his show, Jones described Roederer’s history and the history of CRISTAL champagne. The predicted listening audience for the tour was 40 million. 90. In the 1980’s and earlier decades, celebrities such as Sophia Loren, Julio Iglesias and Ivana Trump were unofficial “ambassadors” of the CRISTAL brand. Pictures showing the “ambassadors” and a bottle of CRISTAL champagne were distributed in various publications, but no evidence indicates the extent of their distribution. In April 1992, Frank Sinatra described CRISTAL champagne as his “favorite” in front of a 1000-person audience. President Reagan was photographed with CRISTAL champagne, although the publicity this photograph received is unknown. 91. Between 1997 and 2009, CRISTAL champagne was mentioned in about 35 magazines and almost 900 newspaper articles. Those articles were published in the New York Times, Miami Herald, Washington Post, Wall Street Journal, USA Today, InStyle, Entertainment Weekly, Rolling Stone, and Forbes, as well as on cnn.com and msnbc.com. 92. Between 1997 and 2009, CRISTAL champagne was mentioned in just under 300 books. A significant number of the books were written by bestselling authors such as Nora Roberts, Candace Bushnell, Richard North Patterson, John Grisham, and Danielle Steele. Typically, CRISTAL champagne was mentioned in connection with the consumption of or a request for CRISTAL champagne by a character. 93. Today, CRISTAL champagne is frequently used as a product placement in movies and television shows. Roederer and MMD manage the use of the CRIS-TAL mark in movies and on television by reviewing the scripts to determine how CRISTAL champagne will be used. If Roederer considers the proposed use inappropriate, Roederer will reject the request to use CRISTAL champagne. In some cases, producers alter the use of CRIS-TAL champagne in response to a rejection by Roederer. As of 2004, MMD was receiving about forty requests a year to place CRISTAL champagne in movies, television shows, and music videos. Roederer and MMD do not pay for any of those product placements. 94. CRISTAL champagne has appeared in several movies since 1990, including The Hours, Austin Powers Gold-member, Lost in Translation, Something’s Gotta Give, The First Wives Club, Eyes Wide Shut, and The Terminal. The references to CRISTAL champagne are typically oral or a screen shot of a CRISTAL champagne bottle that is often in the background or partially obscured. CRISTAL champagne has also appeared in several television shows, including Entourage, ER, and 30 Rock. In many of those television shows, CRISTAL champagne was shown in the background or partially obscured. In other television shows, CRISTAL champagne was mentioned by name. For example, a character complained about the high price of CRISTAL champagne in one episode of The Sopranos. 95. In some of the television shows, CRISTAL champagne was highlighted as an important part of the show. In a show celebrating Oprah Winfrey’s 50th birthday, John Travolta proposed a toast to Winfrey, mentioned CRISTAL ROSÉ champagne by name twice, and described CRISTAL ROSÉ champagne as Winfrey’s “favorite.” A large bottle of CRISTAL ROSÉ champagne was then presented on-stage and the champagne consumed. On The Tonight Show with Jay Leño, a guest brandished a bottle of CRISTAL champagne during his entrance, mentioned the champagne by name, and presented it to Jay Leno with much fanfare over a two-minute period. 96. The number of viewers of television shows and movies and the number of readers of magazines and newspapers referring to CRISTAL champagne is significant. On average, OprahTs audience numbers 8 million, The Sopranos’ audience numbers 11 million, and Entourage’s audience numbers 2.5 million. The average circulation of the New York Times is about 1.5 million, the San Francisco Chronicle a little under 1 million, and InStyle about 1.7 million. 97. Beginning in the late 1990’s, mentions of CRISTAL champagne became prevalent in music lyrics and videos by artists such as Jay-Z, Lil’ Kim, Mariah Carey, Snoop Dog, and 50 Cent. Women’s Wear Daily reported that CRISTAL was the ninth-most mentioned brand in Billboard’s Top 20 singles in 2005, and the CRISTAL name was the eighth most-mentioned brand in rap music the same year. The Washington Post described CRISTAL as a “household name” as a result of this publicity. Media recognition of the CRIS-TAL brand includes statements such as “CRISTAL, everybody knows that kind of champagne.” The brand recognition resulting from the references to CRISTAL champagne in rap music was commented on in the San Francisco Chronicle in 2004 and the Wall Street Journal in 2006. 98. In addition, over fifty videos, blogs, and pictures are available on the Internet where the poster displays a picture of a CRISTALINO bottle with the “INO” obliterated or obscured and describes CRIS-TALINO cava as CRISTAL’s “younger brother” or otherwise jokes about the similarity between the words “CRISTAL” and “CRISTALINO.” In making the joke, the consumers demonstrate their awareness of CRISTAL champagne. B. Recognition, advertising, and promotion of CRISTALINO cava 99. Since 1993, CRISTALINO cava has received favorable reviews or been recognized as a good value in a number of publications, including the San Francisco Independent, Atlanta Journal, and Philadelphia Enquirer. CRISTALINO cava received a silver medal in its category at the 1994 International Wine Competition in Atlanta. Wine Spectator recognized CRISTALINO cava as a “Best Buy” in 1996, and Wine & Spirits recognized CRISTALINO cava as the “Value Brand of the Year” in 2002, 2003, and 2004. The December 2003 issue of Bon Appétit described CRISTALINO cava as giving “excellent effervescent flavor at a moderate price.” Carrion promotes CRISTALINO cava as a “best buy” based on its combination of price and quality, and its marketing strategy is based in part on the assumption that consumers will purchase a less-expensive sparkling wine when large quantities are required. 100. Carrion maintains a “bank” for the promotion of CRISTALINO cava of $* * * for each case of CRISTALINO cava sold to a distributor. The bank funds pricing promotions, revisions to wine lists, and point-of-sale promotional devices. Typically, the amount expensed against the bank by CIV USA on an annual basis is between $* * * and $* * *. Between 1999 and 2000, CIV USA retained TKO Advertising, Inc., to assist with the promotion of CRISTALINO cava. During that time frame, CIV USA spent about $* * * on advertising CRISTALINO cava. Between 2000 and 2006, excluding the TKO Advertising expenditures, CIV USA spent approximately $* * * on media advertising and $* * * on promoting and marketing CRISTALINO cava. C. Trade channels 101. There are around * * * U.S. distributors of CRISTAL champagne, which is sold in approximately 4500 liquor stores in the United States. About 70% of those liquor stores also carry BRUT PREMIER champagne. Sales at liquor stores account for half of the sales of CRISTAL champagne and sales at restaurants, hotels, and nightclubs account for the other half. At least twelve liquor distributors carry both CRISTAL champagne and CRISTALINO cava. 102. CRISTAL champagne is sold at a variety of liquor stores, including Surdyk’s Liquor in Minneapolis and Sherry Lehmann in New York. At times, CRISTAL champagne is sold at mass merchandisers such as Safeway and CostCo, although such sales are inconsistent with the desired image of CRISTAL champagne. Liquor stores display CRISTAL champagne on the top shelf, behind the check-out counter, or in a “lockbox.” 103. CRISTALINO cava is sold at mass merchandisers such as CostCo, Safeway, and Sam’s Club. CRISTALINO cava is also sold in a variety of liquor stores, including Surdyk’s in Minneapolis; Beltramo, K & L, and The Wine Exchange in California; and Sherry Lehmann in New York. When sold in liquor stores, CRIS-TALINO cava is typically displayed on lower shelves or in bins located in or beside the aisles. 104. Although CRISTAL champagne is not sold at every liquor store that sells CRISTALINO cava, the products are frequently sold at the same liquor stores. CRISTAL champagne and CRISTALINO cava are displayed in the same area, usually identified as the “champagne and sparkling wine” area, which may be subdivided by country or region of origin. 105. In flyers and brochures for sales at liquor stores, sparkling wines are generally listed together under a “champagne and sparkling wine” category, which is then divided into subcategories of “French Champagne,” “European Sparkling,” and “California Sparkling” or “American Sparkling.” CRISTAL champagne is listed under the French Champagne subcategory and CRISTALINO cava under the European Sparkling subcategory. 106. Although CRISTAL champagne and CRISTALINO cava do not frequently appear on the same wine list, such listings exist. When they are displayed on the same wine lists, CRISTAL champagne and CRISTALINO cava are typically listed together in close proximity in a “champagne and sparkling wine” section. Many wine lists identify the country of origin of CRISTAL champagne and CRISTALINO cava. Almost all wine lists identify CRIS-TAL champagne as a Roederer product; fewer identify CRISTALINO cava as a product of the Jaume Serra winery. 107. Neither CRISTAL champagne nor CRISTALINO cava is heavily advertised by its producer. Advertisements for and reviews of both products have appeared in Wine & Spirits, Wine Enthusiast, and Wine Spectator. The audiences of those publications have a median age in the late 40’s and a median household income of $125,000 or higher. Over 80% of the readers have attended college. VI. Actual confusion A. Testimony 108. Fabrice Rossett began working at Roederer in 1974 as the export director. He worked for Roederer in various capacities until 1996, at which time he was the president and chief executive officer of MMD. Rossett testified that no retailer or consumer ever indicated to him that there was confusion between CRISTALINO cava and CRISTAL champagne. 109. McCarthy, the wine expert, worked in wine shops between 1976 and 1998. McCarthy testified that during the last nine years he worked in wine shops, after the introduction of CRISTALINO cava in 1989, consumers asked him if there was a relationship between CRISTALINO cava and CRISTAL champagne. McCarthy did not testify as to the frequency of those questions. 110. Xavier Barlier, the vice-president of marketing and communications at MMD, regularly visits the champagne and sparkling wine section of liquor stores as part of his duties. While working the Roederer table and pouring CRISTAL champagne at a Toast of the Town event, Barlier was asked: “Do you know that there’s a Cristalino table?” He testified that, beginning in 2001 and continuing to the present, consumers asked him if there was a relationship between CRISTALINO cava and CRISTAL champagne at store tastings, particularly during the winter holidays. 111. In December 2004, a liquor store owner in Michigan purchased bottles of CRISTALINO cava believing they were bottles of CRISTAL champagne because stickers placed on the bottle concealed the “INO” portion of “CRISTALINO” and proclaimed “1995 Louis Roederer.” Once notified of the sale, the district manager for CRISTALINO cava’s distributor in the region informed the store owner that the bottles were not CRISTAL champagne. No other action was taken with respect to this incident. B. Likelihood of confusion survey 112. Roederer retained Dr. Leon B. Kaplan, the president and chief executive officer of Princeton Research and Consulting Center, to design and implement a survey intended to measure the likelihood of consumer confusion between CRISTAL and CRISTALINO. Dr. Kaplan holds a Ph.D. in Industrial Consumer Psychology from Purdue University and an MBA from the Wharton School. He has worked in the field of market research for over thirty years. Dr. Kaplan has designed about twenty surveys for intellectual property litigation and has been involved with over 200 other surveys. 113. The Kaplan survey was conducted on a nationwide basis during the fall of 2007 by a professional interviewing service. Neither the survey interviewers nor the survey respondents knew the purpose of the survey. The interviewers surveyed 261 people in shopping malls in eight different regional U.S. markets. Two of the malls were located in the Northeast, two in the Midwest, two in the South, and two in the West. The survey participants were randomly divided into a control group and a test group. 114. Dr. Kaplan defined the survey universe as people who were 21 or older, had purchased in the past six months or were likely to purchase in the next six months imported sparkling wine under $35, and were aware of CRISTAL champagne before the interview. Dr. Kaplan characterized this universe as “purchasers and potential purchasers of CRISTALINO who are aware of CRISTAL.” He selected the $35 figure because he wanted to include those who had purchased CRIS-TALINO cava in a restaurant or were likely to do so as well as those who had purchased CRISTALINO cava in a liquor store or were likely to do so. 115. The interviewer first determined the potential respondents’ gender and age. Next, the interviewers determined whether the potential respondents had purchased in a store or restaurant in the past six months an imported sparkling wine for under $35 per bottle or were likely to do so in the next six months. After screening for characteristics that would render a potential respondent ineligible, such as working for a law firm, the interviewers brought potential respondents to an interview area. Once in that area, the potential respondents were shown a bottle of CRIS-TAL champagne still wrapped in yellow cellophane and asked: “To the best of your knowledge, have you ever heard of or seen this brand of wine before today, or don’t you have an opinion about that?” Only potential respondents who indicated that they had heard of or seen CRISTAL champagne proceeded to the rest of the survey. Dr. Kaplan estimated that the interviewers at each survey site would need to bring 90 people to the interview room to reach the desired number of 30 respondents per site. He had no knowledge of how many people were actually brought to the interview room. 116. Next, the interviewers asked the respondents a series of questions intended to serve as a “mental change of pace.” The respondents were then shown four bottles of imported sparkling wine displayed together in a line-up. The test group was shown bottles of VEUVE DU VERNAY sparkling wine, W