Yeti Coolers, LLC v. RTIC Coolers, LLC

Filing 365

ORDER DENYING 208 Sealed Motion to Exclude (Wayne Hoyer). Signed by Judge Andrew W. Austin. (td)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TEXAS
AUSTIN DIVISION
YETI COOLERS, LLC,
V.
RTIC COOLERS, LLC, et al.

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A-15-CV-597-RP

ORDER
Before the Court is Defendants’ Motion to Exclude the Testimony of YETI’s Expert Wayne
Hoyer (Dkt. No. 208); YETI’s response (Dkt. No. 270); and RTIC’s reply (Dkt. No. 312). The
motion was referred to the undersigned for resolution.1
Wayne Hoyer is the James L. Bayless/William S. Farish Fund Chair for Free Enterprise and
the Chairman of the Department of Marketing in the McCombs School of Business at the University
of Texas at Austin, where he has taught for 30 years. He received his Ph.D. in Social-Consumer
Psychology from Purdue University in 1980. YETI has designated Hoyer to testify as an expert on
the fame of YETI’s trade dress for its hard-sided coolers, the importance of YETI’s brand awareness
to its competitive position in the market, and the dilution, if any, and marketing-related harm YETI
may have suffered as a result of RTIC’s accused actions. RTIC moves to exclude Hoyer’s testimony
because it contends he fails to distinguish YETI’s trade dress from its brand, he fails to apply the
correct standard for fame, he opines on matters that the jury can decide for itself, he relies on
unreliable second hand studies, and he offers improper legal conclusions.

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These is one of 16 motions the parties have filed challenging their opponent’s experts under
Daubert and FED. R. EVID. 702. Because the standard applicable to the review of this type of motion
is well-known, and to avoid repeating itself over and over in these orders, the Court will not set out
here the black letter law governing such motions. Suffice it to say the Court did in fact apply the
standard set out in Daubert v. Merrell Dow Pharms., 509 U.S. 579 (1993) and its progeny, as
codified in Rule 702.

I.

Distinguishing Trade Dress from Brand
RTIC contends that Hoyer’s testimony regarding fame is unreliable because his analysis of

the marketing and advertising efforts conflated YETI’s trade dress and brand. It argues that Hoyer’s
testimony fails to tie his opinions specifically to trade dress because he considers evidence of the
brand as a whole. YETI disagrees, noting that much of Hoyer’s evidence used to support his
conclusions directly addresses the trade dress. Additionally, YETI argues that RTIC’s argument is
untenable in that the trade dress nearly always appears with other potential source identifying
information. Finally, YETI argues that in a fame analysis under the Lanham Act, there is no need
to distinguish between brand and trade dress.
First, the Court will not address YETI’s argument that the Lanham Act does not require a
distinction between the trade dress and the brand. This legal argument is better suited to a summary
judgment motion. Moreover, it is unnecessary as the Court agrees with YETI that an expert is not
required to solely consider materials that distinguish between the trade dress and brand.2 While at
least some of the marketing materials almost certainly were not aimed at YETI’s trade dress, this is
not a ground to exclude his entire report. See Sally Beauty Supply Co. v. Beautyco, Inc., 304 F.3d
964, 974, 980 (10th Cir. 2002) (considering a survey in which the trade dress and trademark were
not separated, and finding evidence of actual confusion of the trade dress). In fact, in each of the
2

At one point, RTIC argues that Hoyer “is not aware of any YETI advertisements that
displayed the cooler without using the name “YETI”. Dkt. No. 208 at 3. Courts do not require that
the trade dress be advertised without any other brand identifying information. See Pebble Beach
Co. v. Tour 18 I, Ltd., 942 F. Supp. 1513, 1559 (S.D. Tex. 1996) (“Advertisements that emphasize
the relevant trade dress may solidify in the minds of consumers an association between the advertised
trade dress and the source of the trade dress.”). Rather, as in Pebble Beach, the advertisements
should help to form an association between the source and the protected trade dress. Thus, the fact
that Hoyer could not identify any advertisements that did not include the logo does not make his
testimony unreliable. In fact, this is to be expected.
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cases Defendants cite that address marketing and advertising, the courts are assessing whether the
evidence provided is sufficient to establish the ultimate issue, and were not addressing a Daubert
challenge. See Yankee Candle Co. v. Bridgewater Candle Co., LLC, 259 F.3d 25, 44 (1st Cir. 2001);
Sally Beauty Supply Co., 304 F.3d at 974; Pebble Beach Co. v. Tour 18 I Ltd., 942 F. Supp. 1513,
1559 (S.D. Tex. 1996). Moreover, Hoyer addresses the features of trade dress that YETI is
attempting to protect; in his report, he analyzes multiple images of YETI’s marketing and advertising
featuring the trade dress to support his conclusions. The fact that not all of the materials he used,
such as the advertising expenditures, address only trade dress goes to the weight of his testimony.
Similarly, RTIC’s argument that Hoyer did not analyze the advertising for each element of
YETI’s trade dress would bear on the weight to give Hoyer’s testimony, not its reliability. RTIC
relies on Medisim Ltd. v. BestMed LLC, 861 F. Supp. 2d 158, 180 (S.D.N.Y. 2012) to support their
position. In that case, the court excluded a survey because the expert merely “chose a control that
shared ‘certain characteristics’ with the test product,” and it was unclear to which of the elements
the consumers were expressing source confusion. Id. However, Hoyer did not conduct a survey.
Instead, he was analyzing advertising materials provided to him to assess whether YETI featured its
trade dress and the impact of this on YETI’s fame. The fact that Hoyer analyzed trade dress as a
whole goes to the weight of his testimony, and is better addressed through effective crossexamination.
II.

Correct Legal Standard for Fame
RTIC next argues that Hoyer’s testimony is unreliable because he applied the incorrect legal

standard for “fame” in trade dress. To establish that a mark (or in this case trade dress) is famous,
the party must show that the mark is “widely recognized by the general consuming public of the
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United States.” 15 U.S.C. § 1125(c)(2)(A). Under the Trademark Dilution Act of 2006 (TDRA),
there are four non-exclusive factors to determine if a mark is famous:
(i)
(ii)
(iii)
(iv)

The duration, extent, and geographic reach of advertising and publicity of the mark,
whether advertised or publicized by the owner or third parties;
The amount, volume, and geographic extent of sales of goods or services offered
under the mark;
The extent of actual recognition of the mark;
Whether the mark was registered under the Act of March3, 1881, or the Act of
February 20, 1905, or on the principal register.

15 U.S.C. § 1125(c). Moreover, the mark has to be recognized by the general public, and a party
cannot establish fame in a “niche market.” Bd. of Regents, Univ. of Tex. System ex rel. Univ. of Tex.
at Austin v. KST Elec., Ltd., 550 F. Supp. 2d 657, 678-79 (W.D. Tex. 2008). Both RTIC and YETI
agree that this law governs the fame analysis. In fact, RTIC does not argue that Hoyer applied a
different standard; rather, it argues that Hoyer “failed to apply the correct legal standard—or, indeed,
any standard at all—regarding the threshold at which a product becomes sufficiently ‘famous.’” Dkt.
No. 208 at 4.
RTIC contends that there is a “very high threshold” to establish fame, and that Hoyer failed
to apply this threshold to his analysis. It cites several cases, which all set a threshold of around
seventy (70) percent recognition to establish fame. See Dkt. No. 312 at 3, citing 7-Eleven Inc. v.
Lawrence I. Wechsler, 83 U.S.P.Q. 2d 1715, *14 (T.T.A.B. 2007) (finding the mark famous with
73% recognition); Gen. Motors Co. v. Urban Gorilla, LLC, No. 2:06-CV-00133, 2010 WL 5395065,
*5 (D. Utah Dec. 27, 2010) (71% recognition); see also Univ. of Tex., 550 F. Supp. 2d at 679
(requiring the mark to be a “household name” to offer protection as a famous mark). According to
RTIC, because Hoyer did not apply this threshold in his analysis, he applied an incorrect legal
standard. YETI disagrees. First, it argues that Hoyer applied the four factors listed above, finding
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both national and regional fame, and did not merely assess fame with regard to a “niche market.”
Additionally, YETI contends that the standard set forth by Defendants—even if correct (which YETI
disputes)—is a factual determination of the third factor of the Lanham Act, rather than a legal
standard that must be applied by the expert. As such, Hoyer’s testimony should not be excluded on
the basis that he did not address whether YETI’s trade dress met the threshold.
Courts will exclude expert testimony when it relies on an incorrect legal standard. See e.g.,
U.S. Gypsum Co. v. Lafarge N. Am. Inc., 670 F. Supp. 2d 737, 745 (N.D. Ill. 2009); Noskowiak v.
Bobst SA, No. 04-C-0642, 2005 WL 2146073, *5 (E.D. Wis. Sept. 2, 2005). However, in cases such
as this one, where the law is not clearly defined on this point, it would be improper to exclude
Hoyer’s testimony. See In re Se. Milk Antitrust Litig., 2010 WL 5102974, *2 (E.D. Tenn. Dec. 8,
2010) (finding that “it would be inappropriate to determine the correct ‘legal standard’”). Both YETI
and RTIC have presented different thresholds of recognition for determining at what point a mark
is famous. This issue is not yet clearly defined, and is inappropriate for decision in a Daubert
motion. In fact, this exact issue appears to be before the Court in the parties’ motions for summary
judgment.
Moreover, it is not clear that the threshold is a legal standard, or a factual determination as
part of the fact finders’ duty to apply the four factors set out in the Lanham Act. As such, whether
Hoyer set a specific threshold to determine fame does not go to the reliability of his testimony, but
is better suited for cross-examination. See Static Control Components, Inc. v. Lexmark Int’l, Inc.,
No. 5:02-571, 2007 WL 7083655, *18 (E.D. Ky. May 12, 2007) (“Whether he correctly uses this test
is a matter of weight and not admissibility.”). In fact, RTIC’s argument on this point seems to
address the merits of Hoyer’s conclusions, rather than the reliability of his testimony. See Dkt. No.
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312 (arguing that “none of [Hoyer’s] evidence comes close to showing that YETI’s brand . . . has
achieved ‘household name’ status”); Computer Assocs. Int'l, Inc. v. Simple.com, Inc., No. A-CV022748, 2005 WL 6042721, *2 (E.D.N.Y. Jan. 19, 2005) (finding that the balance of the motion
went to the merits, not the reliability, of the expert’s report). Neither party disputes that Hoyer
applied the four factors set forth in the Lanham Act. Whether his factual determinations are correct
is for the fact finder to decide. Similarly, Hoyer employed the analysis for fame with respect to the
national,3 not merely niche, market. RTIC argues that he considers evidence from the niche market,
and thus his testimony is unreliable. However, Hoyer cited to the correct legal standard. Moreover,
he considered evidence of both national and niche fame. The extent of his consideration of the niche
market evidence would go to the weight of his testimony, rather than its admissibility, and may be
addressed by cross-examination.
III.

Matters for the Jury
RTIC also contends that Hoyer’s testimony on the similarity of the products and intent to

copy should be excluded because his testimony involves determinations that the fact finder may
make for itself. It argues that neither of these topics require special expertise. YETI responds that
the fact finder would be assisted in its similarity analysis by Hoyer as he is better able to point out
specific details to the jurors, and his experience and knowledge can assist the jury in understanding
the significance of the documents reflecting an intent to copy.
As the Court noted in a recent order on these motions, this is an issue within the court’s
discretion. See Order related to Prof. J. Wind, citing Betterbox Comm’ns Ltd. v. BB Techs., Inc., 300
3

It is unclear if Defendants are challenging Hoyer’s consideration of regional evidence of
fame. However, Hoyer was permitted to address YETI’s regional fame, as YETI is also suing under
Texas state trademark laws.
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F.3d 325, 329-30 (3d Cir. 2002); and Malletier v. Dooney & Bourke, Inc., 525 F. Supp. 2d 558, 57172 (S.D.N.Y. 2007). Here, Hoyer is testifying to a number of factors of both fame and dilution.
These topics dovetail with his other testimony, and it is appropriate for him to discuss these topics
along side his other opinions.
IV.

Secondhand Studies
RTIC contends that some of the experts that Hoyer relied on conflated YETI’s trade dress

and brand, thereby making Hoyer’s opinion unreliable. RTIC also notes that Hoyer relied on studies
performed by other YETI experts, which are currently being challenged, which makes Hoyer’s
testimony unreliable. See Dkt. No. 208 at 10 (Hoyer stating he relied on reports by Cunningham,
Deeter, Draper, Kamins, Martino, Nelson, Salters, and Wind). Lastly, Defendants argue that Hoyer
relied on declarations obtained by YETI counsel, secondhand reports from “advocates,” and YETI
experts Deeter, Draper, Martino, and Nelson (which Defendants independently seek to exclude) ,
undermining his conclusions. YETI responds that even if the other experts are excluded, this does
not render Hoyer’s testimony unreliable.
First, as discussed above, Hoyer’s opinion is not unreliable for relying on evidence of all
marketing, rather than marketing which solely emphasizes trade dress. The fact that he relied on
another expert who RTIC challenges on the same basis would therefore not render his opinion
unreliable. These arguments go to the weight of his testimony. RTIC also argues that Hoyer relied
on surveys and studies performed by other challenged experts, and thus if their studies are excluded,
Hoyer’s testimony should be as well. “As a general rule, questions relating to the bases and sources
of an expert’s opinion affect the weight to be assigned that opinion rather than its admissibility and
should be left for the jury’s consideration.” Viterbo v. Dow Chem. Co., 826 F.2d 420,422 (5th Cir.
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1987). More to the point, with the exception of the four outdoors experts (discussed below), this
objection is moot, as the Court has denied RTIC’s motions to exclude the experts on whose reports
Hoyer has relied. And even if some of those reports had been excluded, this would not make his
testimony per se unreliable. See Lithuanian Commerce Corp. v. Sarah Lee Hosiery, 202 F. Supp.
2d 371, 377 (D.N.J. 2002) (allowing testimony of an expert even though he had relied on expert
reports that were later excluded). Instead, it would go to the weight of his testimony.
Lastly, Defendants argues that Hoyer relied on marketing evidence provided to him by YETI,
secondhand reports of interviews with advocates, and the testimony from the four outdoorsmen
(YETI experts Deeter, Draper, Martino, and Nelson). Defendants contend that the statements and
marketing studies provided by YETI are unreliable, and thus render Hoyer’s testimony unreliable.
However, reliance on even “unverified or inaccurate information” provided by a client does not
render an expert’s testimony “per se unreliable.” Lee Valley Tools, Ltd. v. Indus. Blade Co., 288
F.R.D. 254, 267 (W.D.N.Y. 2013). As already noted, there is a great deal of material underlying
Hoyer’s opinions, most of which has already been deemed admissible, and thus the fact that he
considered some evidence that is not itself admissible is not a ground for excluding Hoyer’s
testimony. It is instead a subject for cross-examination, if RTIC chooses. The reports of Deeter,
Draper, Martino, and Nelson, who have been excluded by the Court as experts, fall into this same
category.

Hoyer’s reliance on them does not disqualify him, and RTIC can challenge the

appropriateness of relying on such evidence in cross-examination.
V.

Improper Legal Conclusions
Lastly, RTIC objects to what it contends are legal conclusions in Hoyer’s expert report,

including: YETI “satisfies the criteria for being classified as a famous brand;” and “RTIC’s actions
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have created a dilutive effect on YETI’s brand by blurring the association with the premium mark.”
YETI responds that the statements are not improper legal conclusions, but merely embrace an
ultimate issue, and, according to YETI, are not that different from many made by RTIC’s experts.
See Dkt. No. 270 at 9. Though an expert may not offer legal conclusions, an expert opinion “is not
objectionable just because it embraces an ultimate issue” decided by the fact finder. FED. R. EVID.
704(a). In cases where an expert may provide testimony that involves a legal conclusion, the
decision to exclude will rest on whether the testimony is helpful to the jury in resolving any factual
issues. J.S. v. American Institute for Foreign Study, Inc., 2013 WL 5372531, *12 (W.D. Tex. Sep.
24, 2013). That is a decision best made by the trial judge, at trial. RTIC has able counsel who can
object to any legal conclusions Hoyer attempts to offer that it believes are inadmissible.
ACCORDINGLY, Defendants’ Motion to Exclude the Testimony of YETI’s Expert Wayne
Hoyer (Dkt. No. 208) is DENIED.
SIGNED this 28th day of January, 2017.

_____________________________________
ANDREW W. AUSTIN
UNITED STATES MAGISTRATE JUDGE

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