                        Revised October 2, 1998

              IN THE UNITED STATES COURT OF APPEALS

                         FOR THE FIFTH CIRCUIT

                         _____________________

                              No. 96-21102
                         _____________________


     PEBBLE BEACH COMPANY; SEA PINES COMPANY INCORPORATED,

                       Plaintiffs-Appellees-Cross Appellants,

     v.

     TOUR 18 I LIMITED,

                       Defendant-Appellant-Cross Appellee.

     --------------------------------------

     RESORTS OF PINEHURST INCORPORATED,

                       Plaintiff-Appellee-Cross Appellant,

     v.

     GOLFORMS INCORPORATED; ET AL,

                       Defendants,

     TOUR 18 I LIMITED,

                       Defendant-Appellant-Cross Appellee.

_________________________________________________________________

          Appeals from the United States District Court
                for the Southern District of Texas
_________________________________________________________________
                        September 14, 1998
Before REYNALDO G. GARZA, KING, and BENAVIDES, Circuit Judges.

KING, Circuit Judge:
     Defendant Tour 18 I, Ltd. appeals the district court’s

judgment that it infringed and diluted the plaintiffs’ service

marks and one of the three golf-hole designs at issue, and it

challenges the district court’s injunction as vague, punitive,

and overly broad.   See Pebble Beach Co. v. Tour 18 I, Ltd., 942

F. Supp. 1513 (S.D. Tex. 1996).   Plaintiffs Pebble Beach Co.;

Resorts of Pinehurst, Inc.; and Sea Pines Co., Inc. cross-appeal,

arguing that (1) the district court erroneously held that two of

the three golf-hole designs at issue were not infringed or

diluted, (2) its injunction is inadequate to bar future

infringement, and (3) its denial of an accounting of profits and

an award of attorneys’ fees was erroneous.   See id.   We affirm

the district court’s judgment as modified below.

                          I.   BACKGROUND1

     Defendant-appellant-cross-appellee Tour 18 I, Ltd. (Tour 18)

owns and operates a public golf course in Humble, Texas named

“Tour 18.”   Tour 18 began life as a limited partnership that

subsequently merged into Tour 18, Inc., which also owns and

operates a “Tour 18” public golf course in Flower Mound, Texas.

Tour 18 has created these two golf courses exclusively of golf

holes copied from famous golf courses across the country.    The

Tour 18 course in Humble, Texas has three golf holes that are


     1
        For a more extensive recitation of the facts, see the
district court’s opinion. Pebble Beach Co. v. Tour 18 I, Ltd.,
942 F. Supp. 1513, 1526-36 (S.D. Tex. 1996).

                                  2
copies of golf holes from golf courses owned and operated by

plaintiffs-appellees-cross-appellants Pebble Beach Co. (Pebble

Beach); Resorts of Pinehurst, Inc. (Pinehurst); and Sea Pines

Co., Inc. (Sea Pines) (collectively, the Plaintiffs).

                        A.   The Plaintiffs

     The Plaintiffs’ public courses are all part of expensive,

destination golf resorts, which advertise nationally and draw

customers from across the country, including Texas.2    All three

courses have hosted prestigious professional golf tournaments,

many of which are nationally televised, and have been written up

in numerous unsolicited articles, showering the courses with

praise.   All three courses are consistently ranked among the top

golf courses in the United States.

     Pebble Beach is located in Pebble Beach, California.    Tour

18 copied the fourteenth hole from Pebble Beach Golf Links, one

of five courses that Pebble Beach operates in the area.    The

course is located along the scenic shore of the Pacific Ocean and

has been in operation since 1919.    Green fees to play the course

are $245 for the general public and $195 for guests staying at

the resort.

     The district court described Pebble Beach’s par-five

fourteenth hole as a


     2
        Pebble Beach and Pinehurst presented evidence that
approximately five percent of their customers are Texas
residents.

                                 3
     dog-leg right that is ranked as Pebble Beach’s number
     one handicap hole, identifying it as the most difficult
     hole on the course. The 14th Hole is not adjacent to
     the Pacific Ocean, but it provides golfers with a view
     of the ocean from the tee box and while walking from
     the tee box to the green. Its fairway is lined with
     tall cypress and oak trees. One of the most notable
     features of Hole 14 is the large sand bunker guarding
     the left side of the green. In one of its brochures,
     Tour 18 touts this bunker as “one of the most critical
     bunkers in golf.”

Pebble Beach, 942 F. Supp. at 1528.   While the golf course is

famous, the fourteenth hole is not famous among golfers.   It is

not the course’s signature hole3 and is not emphasized in Pebble

Beach’s advertisements and promotional material.   Pebble Beach

owns an incontestable federal service-mark registration4 in the

“Pebble Beach” mark for golfing services, but does not have a


     3
        “A golf course uses a ‘signature’ hole as a ‘trademark’
hole to advertise its course. Usually a signature hole has a
unique design or beauty that sets the hole apart from the rest of
the course and makes the hole memorable.” Pebble Beach, 942
F. Supp. at 1528 n.5.
     4
        Where the owner of a registered service mark uses the
mark in connection with the services specified for five
continuous years after the registration date, the mark is deemed
“incontestable.” See 15 U.S.C. § 1065. Once a mark is
incontestable, its registration constitutes conclusive evidence
of the registrant's right to exclusive use of the mark in
commerce for the services specified, subject only to the seven
defenses enumerated in 15 U.S.C. § 1115(b). See Soweco, Inc. v.
Shell Oil Co., 617 F.2d 1178, 1184 (5th Cir. 1980). In contrast,
where a registered service mark has not achieved
incontestability, its registration constitutes prima facie
evidence of the registrant's exclusive right to use the mark in
commerce for the services specified in the registration. See id.
A contestable registration is subject to “any legal or equitable
defense or defect, . . . which might have been asserted if such
mark had not been registered.” 15 U.S.C. § 1115(a); see also
Soweco, 617 F.2d at 1184.

                                4
federal trademark registration for, or a copyright or design or

utility patent on, the design of the fourteenth hole.

     Pinehurst is located in Pinehurst, North Carolina.     Tour 18

copied the third hole from the Pinehurst No. 2 course, one of

seven courses Pinehurst operates in the area.     The Pinehurst

No. 2 course was designed by Donald Ross, who is considered one

of the greatest golf-course architects.     The No. 2 course is

considered to be his masterpiece.     The first nine holes of the

course began operation in 1903.   Green fees are $145.

     The Pinehurst No. 2 course’s third hole is a par four with

“a natural area of sand interspersed with clumps of wire grass,

which is indigenous to the local area, that extends between 200

and 300 yards along the right side of the fairway.     Adjacent to

the natural area is a sand cart path.”     Id. at 1529.   While the

golf course is famous among golfers, the third hole is not.       The

third hole is not the course’s signature hole, and Pinehurst does

not emphasize the hole in its advertisements or other promotional

material.   Pinehurst owns a federal service-mark registration in

the “Pinehurst” mark for golf services, but does not have a

federal trademark registration for, or copyright or design or

utility patent on, the design of the third hole.

     Sea Pines is located on Hilton Head Island, South Carolina.

Tour 18 copied the eighteenth hole from Harbour Town Golf Links,

the most famous of Sea Pines’s golf courses.     The course was

designed by Pat Dye, a preeminent golf-course designer, and Jack

                                  5
Nicklaus, who is considered to be one of the greatest golfers of

all time and is also an accomplished golf-course designer.    The

course is distinguished by the presence of a lighthouse behind

the eighteenth green.    The course has been in operation since

1969, and construction of the lighthouse was completed in 1970.

Green fees are $164.

     The lighthouse that can be seen from Harbour Town’s par-

three eighteenth hole

     is octagonal in shape with red and white striping.
     While the lighthouse is visible from the tee box and
     fairway of the 18th Hole, it is not physically on the
     golf course. The lighthouse is actually situated 100
     feet from the 18th green across a small inlet of water
     leading to the Harbour Town marina. . . . [T]here was
     testimony at trial that because of the location of the
     lighthouse, many golfers use it as a target to line up
     their tee shots. However, according to [the developer
     of the course], his placement of the lighthouse in
     relation to the 18th hole was not to create a target
     for golfers, but to guarantee exposure for the
     lighthouse on television during professional
     tournaments.

Id. at 1530.   Sea Pines’s predecessors built the lighthouse and

later sold the physical structure to another company in 1984,

which then sold it to Prudential Bache-Fogelman Properties

(Fogelman).    Sea Pines entered into a licensing agreement with

Fogelman to allow Fogelman to use depictions of the lighthouse.

     The eighteenth hole of Harbour Town Golf Links is one of the

most famous holes in golf and is the course’s signature hole.

Sea Pines emphasizes the hole in Harbour Town’s advertisements

and promotional materials.    The lighthouse’s association with the


                                  6
hole has led to the hole commonly being referred to as the

“Lighthouse Hole.”   Sea Pines does not own a federal service-mark

registration for the “Harbour Town” mark.      The design of the

lighthouse is not protected by a copyright or design or utility

patent.   Sea Pines does not own a federal service-mark

registration for the lighthouse for golfing services.      The design

of the eighteenth hole is not protected by a copyright or design

or utility patent; nor does Sea Pines own a federal trademark

registration for the design of the eighteenth hole.

                          B.   The Defendant

     In 1992, Tour 18 opened its golf course in Humble, Texas.

The course consists of a collection of replica golf holes from

sixteen famous golf courses.    The first hole is a replica of the

eighteenth hole of Harbour Town Golf Links including a smaller

scale, nonfunctioning replica lighthouse.      The third hole is a

replica of the third hole of the Pinehurst No. 2 course, and the

thirteenth hole is a replica of the fourteenth hole of Pebble

Beach Golf Links.    The Flower Mound, Texas Tour 18 course has a

replica of the Harbour Town eighteenth hole including lighthouse

as its seventh hole.   These replica golf holes were created using

topographic maps procured from third parties and videotapes of

the golf holes.

     Tour 18 markets itself as “America’s Greatest 18 Holes.”        It

places advertisements in regional and national publications.       In



                                   7
advertisements and promotional materials, Tour 18 identifies the

golf holes that it has copied by using the trademarks of the

original courses and refers to the golf holes by common nicknames

like the “Lighthouse Hole,” the “Blue Monster,” and “Amen

Corner.”   It uses the Plaintiffs’ marks, “Pebble Beach,”

“Pinehurst,” “Harbour Town,” and depictions of the lighthouse,

extensively in its advertisements and promotional materials.

These materials regularly include pictures of Tour 18’s replica

lighthouse.   The Tour 18 scorecard includes the Plaintiffs’ marks

to identify the replica golf holes.   For example, “Pebble Beach

14” is printed next to the number 13.   A picture of the replica

lighthouse appears on the back of the scorecard.   Tour 18’s

yardage guide has a picture of its replica lighthouse on the

cover and contains descriptions of the golf holes and the history

of each copied golf hole.   Signage at each hole indicates the

golf hole that has been copied and describes the original hole.

The sign at the Harbour Town replica refers to it as “The

Lighthouse Hole.”   Additionally, Tour 18 uses the Plaintiffs’

marks on its menu at its restaurant, offering “The Harbour Town”

hamburger, “The Pinehurst” tuna salad, and “Pebble Beach” French

toast.

     Tour 18 includes disclaimers on the course and in some

advertisements and promotional material.   On its scorecard and in

its yardage guide, Tour 18 includes the following disclaimer:

“The design of this course was inspired by great holes from 16

                                 8
different golf courses.     None of the courses endorse, sponsor, or

are affiliated with Tour 18.”     The same disclaimer is on a sign

at the first tee.    Additional similar disclaimers are on signs at

each golf hole stating, for example, “The design of this hole was

inspired by the famous 14th Hole at Pebble Beach.     Tour 18 is not

affiliated with, endorsed, or sponsored by Pebble Beach.”     A

promotional brochure with pictures of the replica golf holes

contains the Plaintiffs’ marks on the pictures of each replica

golf hole and a notice below the last photo stating: “Actual

Photographs taken at TOUR 18-Houston.”     However, several

advertisements and promotional materials do not contain any

disclaimers.   For example, an issue of Metro Houston Golfer has a

picture of the replica lighthouse on its cover and a detailed

Tour 18 advertisement inside, but includes no disclaimer in the

magazine.   Also, a Tour 18 mailer which includes a large drawing

of the replica lighthouse with the phrase “Harbour Town Golf

Links-the Lighthouse Hole” without any disclaimer.

     Tour 18 charges green fees of $55 during the week and $75 on

weekends.   While not as expensive as the green fees at the

Plaintiffs’ courses, these green fees are higher than the average

green fees at comparable daily-fee courses in the Houston area.

                    C.   District Court Proceedings

     The Plaintiffs filed suit against Tour 18 asserting federal

claims under the Lanham Act, 15 U.S.C. §§ 1051-1127, for service-



                                   9
mark and trade-dress infringement, unfair competition, and false

advertising.   See Pebble Beach, 942 F. Supp. at 1526.    Under

Texas law, the Plaintiffs asserted claims for common-law unfair

competition, conversion, and civil conspiracy and for service-

mark and trade-dress dilution under the Texas anti-dilution

statute, see TEX. BUS. & COM. CODE ANN. § 16.29 (Vernon Supp. 1998).

Pebble Beach also asserted a claim for copyright infringement

based upon maps used by Tour 18.      See Pebble Beach, 942 F. Supp.

at 1526.   Tour 18 counterclaimed under Texas common law for

unfair competition, interference with existing and prospective

business relations, and civil conspiracy.      See id.

     After a bench trial, the district court issued an

excellent opinion and entered judgment for the Plaintiffs on

their infringement, dilution, and unfair competition claims in

relation to Tour 18’s use of their names and the image of the

lighthouse, and the court entered judgment for Sea Pines in

relation to Tour 18’s copying of its golf-hole design.      See id.

at 1554, 1561, 1567.   The district court entered judgment for

Tour 18 on the remainder of the Plaintiffs’ claims and entered

judgment for the Plaintiffs on all of Tour 18’s counterclaims.

See id. at 1561-63, 1567-71.   The district court denied the

Plaintiffs’ requests for damages, an accounting of profits, and

attorneys’ fees, but it entered an injunction against Tour 18

requiring it to (1) cease using Pebble Beach and Pinehurst’s

marks, except to inform the public of the golf holes it copied;

                                 10
(2) cease using Sea Pines’s marks and images of the lighthouse,

without any exceptions; (3) remove the replicas of Sea Pines’s

lighthouse from both of its courses; (4) include a conspicuous

disclaimer in all advertisements, promotional material, and

informational guides; (5) maintain the disclaimers on the course;

and (6) make no claims of use of original blueprints, maps, or

other data in the construction of the course without a

disclaimer.   See id. at 1571-78.       The district court has

partially stayed the injunction pending appeal in relation to the

requirement of removing the replica lighthouses.       Tour 18 and the

Plaintiffs now appeal.

                          II.    DISCUSSION

     Tour 18 appeals the district court’s judgment that it

infringed and diluted the Plaintiffs’ service marks and Sea

Pines’s trade dress and that it competed unfairly.       Tour 18 also

appeals the district court’s injunction, claiming that it is

overly broad, punitive, and vague.       The Plaintiffs cross-appeal

the district court’s judgment that Tour 18 did not infringe or

dilute Pebble Beach and Pinehurst’s trade dress, its injunction

as providing inadequate relief, and its denial of an accounting

of profits and an award of attorneys’ fees.       We consider each

issue in turn.

                         A.     Infringement

     For the Plaintiffs to prevail on their service-mark and


                                   11
trade-dress infringement claims, they must show (1) that the mark

or trade dress, as the case may be, qualifies for protection and

(2) that Tour 18’s use of the mark or trade dress creates a

likelihood of confusion in the minds of potential consumers.       See

Taco Cabana Int’l, Inc. v. Two Pesos, Inc., 932 F.2d 1113, 1117-

18 (5th Cir. 1991), aff’d, 505 U.S. 763 (1992); Security Ctr.,

Ltd. v. First Nat’l Sec. Ctrs., 750 F.2d 1295, 1298 (5th Cir.

1985).   A trademark or service mark is “any word, name, symbol,

or device or combination thereof” used by a person to “identify

and distinguish his or her goods [or services], including a

unique product [or service],” from the goods or services of

another and “to indicate the source of the goods [or services],

even if that source is unknown.”     15 U.S.C. § 1127.   “‘Trade

dress’ refers to the total image and overall appearance of a

product” and “may include features such as the size, shape,

color, color combinations, textures, graphics, and even sales

techniques that characterize a particular product.”      Sunbeam

Prods., Inc. v. West Bend Co., 123 F.3d 246, 251 & n.3 (5th Cir.

1997), cert. denied, 118 S. Ct. 1795 (1998).     With trade dress,

the question is whether the “combination of features creates a

distinctive visual impression, identifying the source of the

product.”   Id. at 251 n.3.

     The same tests apply to both trademarks and trade dress to

determine whether they are protectible and whether they have been

infringed, regardless of whether they are registered or

                                12
unregistered.   See Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S.

763, 768-70, 773-74 (1992); see also Sunbeam Prods., 123 F.3d at

251 n.4.   Both are protectible if they are inherently distinctive

or have achieved secondary meaning in the public’s mind--i.e., if

the trade dress or mark “‘has come through use to be uniquely

associated with a specific source.’”     Sunbeam Prods., 123 F.3d at

253 (quoting Two Pesos, 505 U.S. at 766 n.4); see also Sicilia Di

R. Biebow & Co. v. Cox, 732 F.2d 417, 425 n.4 (5th Cir. 1984).5

However, trade dress is not protectible and cannot be distinctive

if it is functional--i.e., if the design “is one of a limited

number of equally efficient options available to competitors and

free competition would be unduly hindered by according the design

trademark protection.”   Two Pesos, 505 U.S. at 775; see also

Sicilia Di R. Biebow, 732 F.2d at 428-29.    Once a plaintiff’s

mark or trade dress is found to be protectible, liability for

trademark and trade-dress infringement hinges upon whether a

likelihood of confusion exists in the minds of potential

consumers as to the source, affiliation, or sponsorship of the

defendant’s product or service due to the use of the allegedly

infringing marks or trade dress.     See Society of Fin. Exam’rs v.

National Ass’n of Certified Fraud Exam’rs, Inc., 41 F.3d 223, 227

(5th Cir. 1995); Oreck Corp. v. U.S. Floor Sys., Inc., 803 F.2d

166, 170 (5th Cir. 1986).

     5
        See footnote 4, supra, for the procedural effect of
registration upon a mark’s protectibility.

                                13
                                   1.   Standard of review

     We review the district court’s conclusions of law de novo

and its findings of fact for clear error.                 See Joslyn Mfg. Co. v.

Koppers Co., 40 F.3d 750, 753 (5th Cir. 1994).                  Under the clear

error standard, we will reverse the district court only if we

have a “definite and firm conviction that a mistake has been

committed.”        B.H. Bunn Co. v. AAA Replacement Parts Co., 451 F.2d

1254, 1260 (5th Cir. 1971) (internal quotation marks omitted).

However, “the ‘clearly erroneous’ standard of review does not

insulate factual findings premised upon an erroneous view of

controlling legal principles.”                Johnson v. Hospital Corp. of Am.,

95 F.3d 383, 395 (5th Cir. 1996) (citing Johnson v. Uncle Ben’s,

Inc., 628 F.2d 419, 422 (5th Cir. 1980), vacated on other

grounds, 451 U.S. 902 (1981)).                The functionality,

distinctiveness, or secondary meaning of a mark or trade dress

and the existence of a likelihood of confusion are questions of

fact.      See Elvis Presley Enters. v. Capece, 141 F.3d 188, 196

(5th Cir. 1998) (likelihood of confusion); Epic Metals Corp. v.

Souliere, 99 F.3d 1034, 1037 (11th Cir. 1996) (functionality);

Security Ctr., 750 F.2d at 1297-98 (distinctiveness); American

Heritage Life Ins. Co. v. Heritage Life Ins. Co., 494 F.2d 3, 13

(5th Cir. 1974) (secondary meaning); see also 1 J. THOMAS MCCARTHY,

MCCARTHY   ON   TRADEMARKS   AND    UNFAIR COMPETITION § 7:71 (4th ed. 1998)

[hereinafter MCCARTHY          ON   TRADEMARKS] (functionality).



                                              14
              2.   Protectible marks and trade dress

     The district court considered the Plaintiffs’ marks, “Pebble

Beach,” “Pinehurst,” and “Harbour Town,” and the image of the

lighthouse and found them to be protectible.        See Pebble Beach,

942 F. Supp. at 1537-41.      In the case of the design of the three

golf holes, the district court determined that the configuration

of a golf hole is nonfunctional, but it found that only Sea

Pines’s golf-hole design was protectible.         See id. at 1555-61.

Tour 18 challenges only the district court’s findings that the

Sea Pines’s golf-hole design is protectible and that Sea Pines

has protectible rights in the lighthouse.     Tour 18 does not

challenge the district court’s finding that the Plaintiffs’ other

marks are protectible.    The Plaintiffs challenge the district

court’s finding that Pebble Beach and Pinehurst’s golf-hole

designs are not protectible.     We consider the golf-hole designs

and the lighthouse in turn.

                         a.   golf-hole designs

     Turning first to the district court’s traditional trade-

dress analysis of Tour 18's challenge to the protectibility of

the designs of the Plaintiffs’ golf holes, Tour 18 attacks the

district court’s findings that a golf-hole design is

nonfunctional and that Sea Pines’s golf-hole design is

protectible in that it is inherently distinctive or alternatively

has acquired secondary meaning.     The Plaintiffs challenge the


                                   15
district court’s findings that Pebble Beach and Pinehurst’s golf

holes are not inherently distinctive and are therefore

unprotectible, but they do not challenge its finding that neither

golf-hole design has acquired secondary meaning.

                         i.   functionality

     The Lanham Act protects only nonfunctional distinctive trade

dress; this limitation “serves to assure that competition will

not be stifled by the exhaustion of a limited number of trade

dresses.”   Two Pesos, 505 U.S. at 775.   “[A] design is legally

functional, and thus unprotectible, if it is one of a limited

number of equally efficient options available to competitors and

free competition would be unduly hindered by according the design

trademark protection.”   Id. (citing Sicilia Di R. Biebow, 732

F.2d at 426); see also Sunbeam Prods., 123 F.3d at 251 n.6.      “The

ultimate inquiry . . . is whether characterizing a feature or

configuration as protected will hinder competition or impinge

upon the rights of others to compete effectively in the sale of

goods.”   Id. at 255 (internal quotation marks omitted) (quoting

Sicilia Di R. Biebow, 732 F.2d at 429).    Thus, functionality

“secures for the marketplace a latitude of competitive

alternatives,”   Taco Cabana, 932 F.2d at 1119, and “balanc[es]

the interest in facilitating innovation against the interest in

fostering competition in the free market,” Sunbeam Prods., 123

F.3d at 255.

     A collection of functional features in a product design does

                                 16
not necessarily make the combination of those features functional

and therefore unprotectible.   See Sunbeam Prods., 123 F.3d at

256; Taco Cabana, 932 F.2d at 1119.    Where the trade dress of a

product consists of a particular configuration of features, the

functionality of the design turns on “whether its design as a

whole is superior to other designs, not on whether its component

features viewed individually each have a function.”     Vaughan Mfg.

Co. v. Brikam Int’l, Inc., 814 F.2d 346, 350 (7th Cir. 1987)

(emphasis added).   In determining whether competition would be

stifled, we have considered whether the feature or combination of

features is “superior or optimal in terms of engineering, economy

of manufacture, accommodation of utilitarian function or

performance.”   Sicilia Di R. Biebow, 732 F.2d at 429; see also

Sunbeam Prods., 123 F.3d at 255.     The Supreme Court has stated

the question more generally as whether the trade dress is

“‘essential to the use or purpose of the article or if it affects

the cost or quality of the article,’ that is, if exclusive use of

the feature would put competitors at a significant non-

reputation-related disadvantage.”     Qualitex Co. v. Jacobson

Prods. Co., 514 U.S. 159, 165 (1995) (quoting Inwood Lab., Inc.

v. Ives Lab., Inc., 456 U.S. 844, 850 n.10 (1982)).

     The district court determined that the golf-hole designs at

issue here are nonfunctional, noting that there is an “unlimited

number of alternative designs” to the Plaintiffs’ golf-hole

designs and that no evidence indicated that the Plaintiffs’

                                17
designs are superior to the many available alternatives.      See

Pebble Beach, 942 F. Supp. at 1556.     In finding that competition

would not be hindered by protecting the Plaintiffs’ golf-hole

designs, the district court noted that one of Tour 18’s experts

testified that protecting the design of the golf holes from

copying would not unduly injure competition and that Tour 18’s

director of marketing testified that a golf course need not copy

golf-hole designs in order to be competitive in the Houston

market.   See id.

     Tour 18 first attacks the district court’s finding that golf

holes are nonfunctional by defining its product as a golf course

that provides replicas of famous golf holes.     It claims that such

a product requires that it be able to copy famous golf holes in

order to have any commercial success in delivering its product: a

course copying famous golf holes.     While Tour 18’s product may be

a golf course the commercial success of which has been based upon

copying golf holes, it nevertheless is still just a collection of

golf holes.   Features that contribute to the commercial success

of a product are not thereby necessarily classed as functional.

In Sicilia Di R. Biebow, this court rejected the argument that

functionality should be defined in terms of commercial success or

marketing effectiveness because such a definition would allow a

second comer to copy the protectible trade dress of a product

whenever the product became successful and preferred by

consumers.    See 732 F.2d at 428.    Tour 18 argues that in Qualitex

                                 18
the Supreme Court overruled this holding with its citation of

Justice White’s concurrence in Inwood Laboratories, which stated

that “[a] functional characteristic is an important ingredient in

the commercial success of the product.”    See Qualitex, 514 U.S.

at 165 (internal quotation marks omitted) (quoting Inwood Lab.,

456 U.S. at 863 (White, J., concurring in the result)).    However,

these two statements are not inconsistent.    Justice White’s

statement is merely an acknowledgment that a functional feature

is by definition important to the commercial success of a product

because without the functional feature a viable, competitive

product could not be produced and because competition would be

injured if such a feature were protectible by trademark law.      The

converse, however, is not true.    To define functionality based

upon commercial success would allow the second comer to trade on

the first comer’s goodwill, purely because it would be easier to

market his product and not because he could not produce a viable,

competitive product.    Such a rule does not promote innovation,

nor does it promote competition, leaving no reason to narrow

trademark protection.    The logical extension of this argument

would practically obliterate trademark protection for product

design because a defendant could always argue that its innovative

product is a widget that provides a replica of the most popular

or most prestigious widget on the market, thus requiring that the

defendant be allowed without further analysis to copy the

plaintiff’s widget.

                                  19
     Tour 18 then argues that every feature of a golf hole and

how it is configured affects how the hole plays, making any golf-

hole design functional.    Without citing any authority, Tour 18

urges a rule that a feature or configuration of features is

functional unless “a specific design can be made another way

without affecting use, purpose, cost, quality or commercial

desirability.”   This rule is much broader than any applied in

this circuit or by the Supreme Court and could conceivably render

any design functional because any change would undoubtedly

somehow affect cost, use, or commercial desirability.

Additionally, the Supreme Court limited its statement that trade

dress is functional if the trade dress is essential to the use or

purpose of the product or affects the cost or quality of the

product with the following language: “that is, if exclusive use

of the features [or combination of features] would put

competitors at a significant non-reputation-related

disadvantage.”   Qualitex, 514 U.S. at 165.   This language makes

it clear that any effect must be great enough to significantly

disadvantage competitors in ways other than consumer preference

for a particular source.

     Next, Tour 18 contends that Qualitex imposes as a threshold

inquiry in the functionality analysis the question of whether the

trade dress serves “any other significant function.”     See 514

U.S. at 166.   It argues that this question must be considered

before concerns of competition and available alternative designs

                                 20
can be addressed.         This is a misreading of Qualitex, which held

that, in certain circumstances, color can be a registerable

trademark.    See id..        Where the Supreme Court uses the language

“without serving any other significant function,” it is stating

that color alone may sometimes meet the basic legal requirements

for use as a trademark.          See id. at 166 (citing PATENT          AND   TRADEMARK

OFFICE, U.S. DEP’T   OF   COMMERCE, TRADEMARK MANUAL    OF   EXAMINING PROCEDURE

§ 1202.04(e), at 1202-13 (2d ed. May 1993) (approving

registration of a color that indicates source, provided that

“there is [no] competitive need for colors to remain available in

the industry” and the color is not “functional”), and 1 J.

MCCARTHY, MCCARTHY   ON   TRADEMARKS   AND   UNFAIR COMPETITION §§ 3.01[1], 7.26,

at 3-2, 7-113 (3d ed. 1994) (noting that the requirements for

protecting a word or symbol as a trademark are that it be (1) a

symbol (2) used as a mark (3) to identify and distinguish one’s

goods, but that it not be functional)).                This language in

Qualitex, as supported by its accompanying citations, is just

another way of stating that functionality, with its consideration

of the needs of competition, bars Lanham Act protection to

functional features and configurations, which by definition serve

a significant function other than source-identification.                       As

noted earlier, functionality takes into account whether

protecting a particular feature or combination of features would

“hinder competition or impinge upon the rights of others to

compete effectively.”          See Sunbeam Prods., 123 F.3d at 255

                                             21
(internal quotation marks omitted).   Therefore, Qualitex does not

create a threshold inquiry in the functionality analysis.

Additionally, we have held that nonfunctional trade dress may

still have some utility--i.e., serve a function other than

source-identification--and still be legally nonfunctional.     See

Sicilia Di R. Biebow, 732 F.2d at 429.

     Having rejected Tour 18’s challenges to the district court’s

analysis, and after reviewing the evidence, we find that the

district court did not clearly err in finding that the

Plaintiffs’ golf-hole designs are nonfunctional.6

                       ii.   distinctiveness

     Trademarks and trade dress are distinctive and protectible

if they serve as indicators of source.   See Taco Cabana, 932 F.2d

at 1119-20.   Trademarks and trade dress are classified into the

following categories: (1) generic, (2) descriptive, (3)

     6
         Tour 18 also argues that the district court failed to
consider the aesthetic functionality of a golf hole. This
circuit has rejected the doctrine of aesthetic functionality.
See Sno-Wizard Mfg., Inc. v. Eisemann Prods. Co., 791 F.2d 423,
426 n.3 (5th Cir. 1986); Sicilia Di R. Biebow, 732 F.2d at 428-
29. Tour 18 argues that the Supreme Court acknowledged aesthetic
functionality in Qualitex with its reference to aesthetic
functionality and the Restatement (Third) of Unfair Competition.
See Qualitex, 514 U.S. at 170 (citing RESTATEMENT (THIRD) OF UNFAIR
COMPETITION § 17 cmt. c., at 175-76 (1995)). However, the ultimate
inquiry in aesthetic functionality is the same as utilitarian
functionality: “‘whether the recognition of trademark rights
would significantly hinder competition.’” Id. (quoting
RESTATEMENT, supra, § 17 cmt. c.). Without deciding the viability
of aesthetic functionality in this circuit, we note that, based
upon the testimony of Tour 18’s witnesses that protecting the
golf-hole designs would not burden competition, the golf-hole
designs at issue are not aesthetically functional.

                                 22
suggestive, (4) arbitrary, or (5) fanciful.     See Two Pesos, 505

U.S. at 768 (citing Abercrombie & Fitch Co. v. Hunting World,

Inc., 537 F.2d 4, 9 (2d Cir. 1976)); Sunbeam Prods., 123 F.3d at

252.    The last three categories--suggestive, arbitrary, and

fanciful--are inherently distinctive, requiring no additional

showing to be protectible, “‘because their intrinsic nature

serves to identify a particular source of a product.’”     Sunbeam

Prods., 123 F.3d at 252 (quoting Two Pesos, 505 U.S. at 768).        A

mark or trade dress is descriptive if it “identifies a

characteristic or quality of an article or service, such as its

color, odor, function, dimensions, or ingredients.”     Zatarains,

Inc. v. Oak Grove Smokehouse, Inc., 698 F.2d 786, 790 (5th Cir.

1983) (citations and internal quotation marks omitted).    A

descriptive mark or trade dress is protectible only when it has

“acquir[ed] a secondary meaning in the minds of the consuming

public.”    Id.   A generic mark or trade dress is never protectible

because it connotes “a particular genus or class of which an

individual [product] or service is but a member . . . , rather

than the more individualized characteristics of a particular

product.”    Id. (citations and internal quotation marks omitted).

       The district court found that Pebble Beach and Pinehurst’s

golf-hole designs were not inherently distinctive because they

were variations on commonplace themes in the design of golf

holes.    See Pebble Beach, 942 F. Supp. at 1557-58.   Sea Pines’s

golf-hole design, however, is inherently distinctive according to

                                  23
the district court because the incorporation of the lighthouse

adds an “arbitrary source-identifying feature[].”      Id. at 1558.

Additionally, the district court determined that Sea Pines’s

golf-hole design had acquired secondary meaning in the public’s

mind.   See id. at 1561.   As to Pebble Beach and Pinehurst’s golf-

hole designs, the district court found no evidence to support a

conclusion that either design had acquired secondary meaning.

See id. at 1560-61.

      The Plaintiffs argue that the district court should have

found Pebble Beach and Pinehurst’s golf holes to be inherently

distinctive.    However, Pebble Beach and Pinehurst’s golf-hole

designs do not fall into any of the three inherently distinctive

classifications.    Arbitrary and fanciful marks or trade dress

“bear no relationship to the products or services to which they

are applied.”    Zatarains, 698 F.2d at 791.    The trade dress of

Pebble Beach and Pinehurst’s golf holes is a configuration of

commonplace features of a golf hole and therefore does bear a

relationship to the product, a golf hole.      A suggestive mark or

trade dress “suggests, rather than describes, some particular

characteristic of the goods or services to which it applies and

requires the consumer to exercise the imagination in order to

draw a conclusion as to the nature of the goods and services.”

Id.   The configurations of the features in Pebble Beach and

Pinehurst’s golf-hole designs create golf holes and nothing more.

They require no exercise of one’s imagination to realize that one

                                 24
is viewing a golf hole.   Therefore, the district court did not

clearly err in finding that Pebble Beach and Pinehurst’s golf-

hole designs were not inherently distinctive.7

     Tour 18 argues that Sea Pines’s golf-hole design is not

protectible because a golf hole’s trade dress is generic and

because, even if it is descriptive, the Plaintiffs failed to

present evidence that demonstrates that Sea Pines’s trade dress

has acquired secondary meaning.    In general, a golf hole’s trade

dress may be generic, but Sea Pines’s inclusion of the

distinctive lighthouse in the design of the golf hole takes it

out of the generic classification because it emphasizes the

“individualized characteristics” of this particular golf-hole

     7
         The Plaintiffs argue that their golf-hole designs are
unique and therefore inherently distinctive, urging us to equate
uniqueness with inherent distinctiveness. However, something
that is inherently distinctive is unique, but the converse is not
necessarily true. A product may be unique and yet fail to be
sufficiently distinctive to indicate source. See 1 MCCARTHY ON
TRADEMARKS, supra, § 8:13, at 8-35 to 8-36 (“A product or package
feature is not inherently distinctive merely because there is no
other product on the market that looks exactly the same.”). If
uniqueness were the test, then

     [p]resumably, it could be said about the trade dress of
     any new product that no competitive product combines
     precisely the same elements in its trade dress. . . .
     [Such a test] essentially would require a finding of
     inherent distinctiveness whenever a new product enters
     the market.

Turtle Wax, Inc. v. First Brands Corp., 781 F. Supp. 1314, 1321
(N.D. Ill. 1991) (citing Blue Coral, Inc. v. Turtle Wax, Inc.,
664 F. Supp. 1153, 1163 (N.D. Ill. 1987)); see also Duraco
Prods., Inc. v. Joy Plastic Enters., 40 F.3d 1431, 1447-48 (3d
Cir. 1994). Thus, uniqueness alone cannot be the test for
inherent distinctiveness.

                                  25
design rather than connoting golf holes in general.        See

Zatarains, 698 F.2d at 790.   Therefore, the district court did

not clearly err in finding that Sea Pines’s golf-hole design was

not generic.

     As Sea Pines’s golf-hole design is not generic, it is

protectible if it has acquired secondary meaning.8        That a

particular mark or trade dress has acquired secondary meaning can

be proven by a consideration of the following evidence: (1)

length and manner of use of the mark or trade dress, (2) volume

of sales, (3) amount and manner of advertising, (4) nature of use

of the mark or trade dress in newspapers and magazines, (5)

consumer-survey evidence, (6) direct consumer testimony, and (7)

the defendant’s intent in copying the trade dress.        See

RESTATEMENT, supra, § 13 cmt. e; see also Duraco Prods., 40 F.3d at

1452; Zatarains, 698 F.2d at 795; 2 MCCARTHY   ON   TRADEMARKS, supra,

§ 15:30.   While each of these types of evidence alone may not

prove secondary meaning, in combination they may indicate that

consumers consider the mark or trade dress to be an indicator of

source.    See Zatarains, 698 F.2d at 795.   In considering this

evidence, the focus is on how it demonstrates that the meaning of

     8
        The district court found that the inclusion of the
lighthouse made such a significant difference that Sea Pines’s
golf-hole design is inherently distinctive and thus by definition
not generic. See Pebble Beach, 942 F. Supp. at 1558-59. We need
not consider whether Sea Pines’s golf-hole design is inherently
distinctive because we affirm infra the district court’s finding
that the golf-hole design has acquired secondary meaning. See
Sunbeam Prods., 123 F.3d at 252-53.

                                 26
the mark or trade dress has been altered in the minds of

consumers.   See id.   For example, in the case of advertising,

spending substantial amounts of money does not of itself cause a

mark or trade dress to acquire secondary meaning, but

advertisements may emphasize “the source significance of the

designation through prominent use of the [mark or trade dress]”

and are therefore likely to alter the meaning of the mark or

trade dress in the minds of consumers.     See RESTATEMENT, supra,

§ 13 cmt. c, at 110.

     The district court based its finding of secondary meaning

upon Sea Pines’s extensive advertising; unsolicited publicity of

the trade dress of Sea Pines’s golf hole, including the

lighthouse, in golf publications; and Tour 18’s intent to copy

and use the trade dress prominently in its advertising.      See

Pebble Beach, 942 F. Supp. at 1559-61.    Tour 18 argues that the

district court erred in relying upon the advertising and

publicity because they touted the design of the golf hole for its

playing qualities and not as a designation of source.      While some

of Sea Pines’s advertising and publicity does promote the

playability of the golf hole, the trade dress of Sea Pines’s golf

hole, including the lighthouse, is prominently used in the

advertising and the publicity of the Harbour Town Golf Links in a

manner other than simply to promote the playing qualities of the

golf hole.   See id. at 1559-60.    Therefore, the district court

did not clearly err in finding that Sea Pines’s trade dress had

                                   27
acquired secondary meaning.9

                        b.   the lighthouse

     Tour 18 does not challenge the protectibility of depictions

of the lighthouse; rather, it challenges Sea Pines’s rights in

the lighthouse.   Tour 18 argues that Sea Pines no longer has any


     9
        Tour 18 also argues that it presented survey evidence
indicating that the Plaintiffs’ golf-hole designs had not
acquired secondary meaning in the minds of consumers. Through
the testimony of an expert, Tour 18 presented a survey of the
public’s reactions to pictures of the Plaintiffs’ golf holes.
The survey was entitled “An Investigation of the ‘Inherent
Distinctiveness’ of Selected Golf Holes.” During its expert’s
testimony about the survey, Tour 18’s counsel asked if the expert
had an opinion as to whether Pebble Beach or Pinehurst’s golf-
hole designs had acquired secondary meaning. Tour 18’s counsel
did not ask the same question about Sea Pines’s golf-hole design.

     This omission implies either that the survey was not
probative in relation to whether Sea Pines’s golf-hole design had
acquired secondary meaning or that the survey would have
supported a finding of secondary meaning, an inference not in
Tour 18’s interests. Tour 18 chose not to present the survey as
probative of whether Sea Pines’s trade dress had acquired
secondary meaning as evidenced by the omitted question and by its
failure to argue no secondary meaning for the Sea Pines’s golf-
hole design in its closing argument, and we therefore do not find
error in the district court’s failure to factor in the survey as
to this issue. Additionally, the survey showed that nine percent
of active golfers surveyed identified Sea Pines’s golf hole in a
way indicating source--e.g., “legendary light house hole,” “a
golf course in Hilton Head, S.C.,” and “18th hole harbor [sic]
town.” While this may not be enough to establish secondary
meaning on its own, see, e.g., Roselux Chem. Co. v. Parsons
Ammonia Co., 299 F.2d 855, 862 (C.C.P.A. 1962) (finding 10% to be
insufficient to establish secondary meaning); Zippo Mfg. Co. v.
Rogers Imports, Inc., 216 F. Supp. 670, 689-90 (S.D.N.Y. 1963)
(finding 25% to be insufficient); see also 2 MCCARTHY ON TRADEMARKS,
supra, § 15:45 n.9 (cautioning against using 25% as a benchmark),
it does not negate the showing made by the Plaintiffs,
establishing that Sea Pines’s trade dress has acquired secondary
meaning through evidence of Sea Pines’s advertising, unsolicited
publicity, and Tour 18’s intent.

                                 28
rights in the lighthouse because (1) it does not own the

lighthouse and (2) by its course of conduct, it has abandoned the

lighthouse as a mark.    In response to the first argument, we

adopt the reasoning of the district court:

     The Lanham Act does not require a party to “own” a
     word, symbol, or other identifying mark before it may
     be granted protection from infringement. Rather, all
     that is required is that a party “use” the mark in
     commerce to identify its services and distinguish them
     from the services of others. 15 U.S.C. § 1127; see
     [Boston Prof’l Hockey Ass’n v. Dallas Cap & Emblem
     Mfg., Inc., 510 F.2d 1004, 1014 (5th Cir. 1975)]
     (noting that under trademark law, a party acquires
     rights to a symbol in the public domain through use of
     the mark and the public’s association of the mark with
     the user).

Id. at 1541 (footnote omitted); see also 1 MCCARTHY   ON   TRADEMARKS,

supra, § 7:100-:101.    Tour 18 styles its argument as attacking

Sea Pines’s interest in the structure of the lighthouse itself

and not in the image of the lighthouse, arguing that the only

connection between the golf course and the lighthouse is that the

lighthouse can be seen from the course.    However, Harbour Town

Golf Links was built by the same entity that constructed the

lighthouse and the evidence demonstrates that the placement and

design of the course and the lighthouse were specifically

designed to create the relationship between the course and the

lighthouse.   This is not a case where the only connection is the

coincidence of proximity or location.    The connection between the

course and the lighthouse is much greater and dates back to the

conception of both.    Sea Pines has used depictions of the


                                 29
lighthouse in relation to golfing services since 1969, and the

district court did not clearly err in finding that the lighthouse

has achieved secondary meaning in relation to golfing services in

the minds of consumers.        The sale of the lighthouse to Fogelman’s

predecessor, while reserving trademark rights in depictions of

the lighthouse, does not alter this finding.

     In relation to abandonment, Tour 18 argues that Sea Pines’s

failure to police third-party uses of the lighthouse as a mark

has caused the mark “to lose its significance as a mark,” thus

constituting abandonment under 15 U.S.C. § 1127.            As Tour 18

argues, this form of abandonment does not require any intent to

abandon on the part of Sea Pines.          See id.; RESTATEMENT, supra,

§ 30 cmt. c; 2 MCCARTHY   ON   TRADEMARKS, supra, § 17:8.    However, the

evidence shows, as the district court discussed, that Sea Pines

has not failed to police third-party uses of depictions of the

lighthouse; rather, it has aggressively policed third-party uses.

See Pebble Beach, 942 F. Supp. at 1541.          Additionally, the

district court’s finding of secondary meaning in the lighthouse

mark for golfing services shows that the lighthouse has not lost

its significance as a mark for golfing services, despite the

third-party uses in relation to other products and services.

Those third-party uses are only relevant to the strength of the

mark in this case and do not evidence abandonment.            See

Sweetheart Plastics, Inc. v. Detroit Forming, Inc., 743 F.2d

1039, 1048 (4th Cir. 1984) (citing 1 J.T. MCCARTHY, TRADEMARKS       AND

                                      30
UNFAIR COMPETITION § 17:5, at 779-80 (2d ed. 1984)); RESTATEMENT,

supra, § 30 cmt. c; see also Amstar Corp. v. Domino’s Pizza,

Inc., 615 F.2d 252, 259 (5th Cir. 1980); 2 MCCARTHY   ON   TRADEMARKS,

supra, § 17:17, at 17-27.

                    3.   Likelihood of confusion

     Next we turn to whether Tour 18’s use of the Plaintiffs’

marks and trade dress infringed the Plaintiffs’ rights.        The

touchstone of infringement is whether the use creates a

likelihood of confusion as to the “source, affiliation, or

sponsorship” of Tour 18’s golf course.     See Society of Fin.

Exam’rs, 41 F.3d at 227; Oreck, 803 F.2d at 170; see also 15

U.S.C. § 1114(1); id. § 1125(a)(1)(A) (imposing liability for

uses “likely to cause confusion . . . as to the affiliation,

connection, or association of [the defendant] with another

person, or as to the origin, sponsorship, or approval of [the

defendant’s] goods, services, or commercial activities by another

person”).   Likelihood of confusion is synonymous with a

probability of confusion, which is more than a mere possibility

of confusion.   See Elvis Presley Enters., 141 F.3d at 193.          In

determining whether a likelihood of confusion exists, this court

considers the following nonexhaustive list of factors: (1) the

type of mark allegedly infringed, (2) the similarity between the

two marks, (3) the similarity of the products or services, (4)

the identity of the retail outlets and purchasers, (5) the



                                  31
identity of the advertising media used, (6) the defendant’s

intent, and (7) any evidence of actual confusion.     See Taco

Cabana, 932 F.2d at 1122 n.9; Conan Properties, Inc. v. Conans

Pizza, Inc., 752 F.2d 145, 149 (5th Cir. 1985).    No single factor

is dispositive, and a finding of a likelihood of confusion does

not require a positive finding on a majority of these “digits of

confusion.”    See id. at 150; see also Elvis Presley Enters., 141

F.3d at 194.

     While noting that no golfer will stand on the tee at Tour 18

and believe that he or she is playing at Pebble Beach, Pinehurst,

or Harbour Town, in considering Tour 18’s use of the Plaintiffs’

marks and depictions of the lighthouse, the district court found

that all seven digits of confusion weighed in favor of a

likelihood of confusion as to whether the courses are otherwise

affiliated.    See Pebble Beach, 942 F. Supp. at 1541-50, 1552.     In

reaching this determination, the district court considered Tour

18’s use of disclaimers and found them to be inadequate where

present and to be absent from the majority of advertisements and

promotional material.    See id. at 1550-52.   In relation to Sea

Pines’s trade dress, the district court also found that the

digits of confusion weighed in favor of a likelihood of

confusion, partially relying upon its analysis of the likelihood

of confusion in relation to the marks and upon the same actual

confusion evidence as used in relation to the marks.     See id. at



                                 32
1561.

     Tour 18 attacks the district court’s finding of a likelihood

of confusion based upon its consideration of evidence of actual

confusion that consumers believed that Tour 18 had obtained

“permission” to use the Plaintiffs’ marks and to copy their golf

holes.    Tour 18 argues that “permission” does not include a

connotation of control and therefore does not express a

relationship that is relevant to confusion as to source,

affiliation, sponsorship, or approval.       We disagree.

     Permission is synonymous with approval and suggests some

connection between the parties.      The idea that one party has

given permission to another implies a form of approval of the

other’s activities.    See WEBSTER’S THIRD NEW INTERNATIONAL DICTIONARY

1683 (Philip Babcock Gove ed., 1963) (defining “permission” as

“the act of permitting : formal consent : AUTHORIZATION” and

“permit” as “to consent to expressly or formally”); WILLIAM C.

BURTON, LEGAL THESAURUS 30, 383 (2d ed. 1992) (including “consent

to” among synonyms of “approve,” “permit” among synonyms of

“approval,” and “approval” among synonyms of “permission”); see

also ROGET’S DESK THESAURUS 30, 397 (Joyce O’Connor ed., 1995)

(same).    For a party to suggest to the public, through its use of

another’s mark or a similar mark, that it has received permission

to use the mark on its goods or services suggests approval, and

even endorsement, of the party’s product or service and is a kind

of confusion the Lanham Act prohibits.       See Indianapolis Colts,

                                   33
Inc. v. Metropolitan Baltimore Football Club Ltd. Partnership, 34

F.3d 410, 415-16 (7th Cir. 1994) (finding confusion as to

“permission” relevant); Anheuser-Busch, Inc. v. Balducci

Publications, 28 F.3d 769, 772, 775 (8th Cir. 1994) (same);

University of Ga. Athletic Ass’n v. Laite, 756 F.2d 1535, 1546

(11th Cir. 1985) (same); Dream Team Collectibles, Inc. v. NBA

Properties, Inc., 958 F. Supp. 1401, 1416 (E.D. Mo. 1997) (same).

But see Bristol-Myers Squibb Co. v. McNeil-P.P.C., Inc., 786

F. Supp. 182, 202 (E.D.N.Y.) (expressing concern that confusion

as to permission may actually only be a measure of the popularity

of an established product), vacated on other grounds, 973 F.2d

1033 (2d Cir. 1992).   Therefore, confusion as to permission is

relevant confusion under the Lanham Act.

     The Plaintiffs’ survey was conducted among golfers who had

played a round of golf at Tour 18.   Tour 18 argues that the

survey was flawed because, by relying upon “permission,” it

created the possibility that those surveyed believed that

permission was required, thereby skewing the result.    But the

survey asked whether Tour 18 “did get” or “did not get”

permission to use the Plaintiffs’ marks or to copy the

Plaintiffs’ golf holes.   This question asks what message Tour

18’s use of the Plaintiffs’ marks and trade dress conveyed,

rather than whether Tour 18 needed to get permission, which would

focus on what those surveyed believed to be required.    Although,

this latter form is more problematic because it allows for the

                                34
consumer’s misunderstanding of the law, rather than the

defendant’s use of the marks, to be the basis for his belief, it

has been accepted by other courts as probative as to confusion.

See, e.g., Indianapolis Colts, 34 F.3d at 415 (accepting a survey

that asked if a party needed to get another’s permission to use

the mark at issue); Anheuser-Busch, 28 F.3d at 772, 775

(accepting a survey asking if a party “did have to get permission

to use” the mark).   But see Major League Baseball Properties,

Inc. v. Sed Non Olet Denarius, Ltd., 817 F. Supp. 1103, 1122-23

(S.D.N.Y. 1993) (rejecting a survey for asking a leading

question: “Do you believe that [the defendant] had to get

authorization, that is, permission to use the name . . . ?”),

vacated pursuant to settlement, 859 F. Supp. 80 (S.D.N.Y. 1994).

Therefore, the district court did not improperly rely upon the

Plaintiffs’ survey.10

     In addition to the survey evidence, the district court

relied upon the testimony of the witnesses that, before actually

     10
        We have held in the text that the district court did not
err in relying upon the Plaintiffs’ survey asking whether
permission was obtained. However, we note that “approval” is a
word with an easily understood everyday meaning that could have
been used just as easily in the survey or in questions asked of
the witnesses. We do not hold here that the unfettered use of
“permission,” rather than “approval” or other less ambiguous
language, is always acceptable, and we caution litigants to
consider the language of the survey and questions so that the
consumer’s belief that permission is required does not skew the
results of the survey, thus decreasing its probative value. See
Exxon Corp. v. Texas Motor Exch. of Houston, Inc., 628 F.2d 500,
506-07 (5th Cir. 1980); Holiday Inns, Inc. v. Holiday Out In Am.,
481 F.2d 445, 447-48 (5th Cir. 1973).

                                35
playing the course, they thought Tour 18 had obtained permission

to use the Plaintiffs’ marks and trade dress; most notably, two

witnesses testified that Tour 18’s advertising in particular

caused their confusion.     See Pebble Beach, 942 F. Supp. at 1547-

48 & nn.31-32.   This confusion was relevant even if it was

obviated by playing the course and viewing the holes and

disclaimers on the golf course signs.     See Elvis Presley Enters.,

141 F.3d at 204.    Moreover, those disclaimers and signs did not

necessarily obviate the confusion as evidenced by the findings of

the Plaintiffs’ survey of golfers who had played Tour 18 and had

been exposed to all of Tour 18’s disclaimers on the course.     See

Pebble Beach, 942 F. Supp. at 1548-50.    Additionally, “[e]vidence

of actual confusion is not necessary to a finding of a likelihood

of confusion.”     Elvis Presley Enters., 141 F.3d at 203-04 (citing

Amstar, 615 F.2d at 263).    After reviewing the record, we cannot

say that the district court committed clear error in finding

actual confusion and in finding a likelihood of confusion based

partially upon that actual confusion, resulting from Tour 18’s

use of the Plaintiffs’ marks and trade dress.11    Cf. Champions

     11
        In its reply brief, Tour 18 challenges other aspects of
the district court’s findings, including its consideration of the
intent factor in the likelihood-of-confusion analysis and its
partial reliance upon the likelihood-of-confusion analysis of the
use of the Plaintiffs’ marks in its analysis of the use of Sea
Pines’s trade dress. Because Tour 18 failed to raise these
arguments in its initial brief on appeal, we will not consider
them. See Cinel v. Connick, 15 F.3d 1338, 1345 (5th Cir. 1994)
(“An appellant abandons all issues not raised and argued in its
initial brief on appeal.”). However, we note that neither of the

                                  36
Golf Club, Inc. v. The Champions Golf Club, Inc., 78 F.3d 1111

(6th Cir. 1996) (finding that a likelihood of confusion as to

affiliation could exist between two golf courses located in

Nicholasville, Kentucky and Houston, Texas).

                        4.   Nominative use

     Tour 18 asserts that it has used the Plaintiffs’ marks only

to identify the Plaintiffs’ golf holes that it copied and that

such use, as a matter of law, does not create a likelihood of

confusion.   The district court treated this argument by Tour 18

as a species of the fair-use defense and considered it after

finding a likelihood of confusion.    See Pebble Beach, 942

F. Supp. at 1552-54.   While a claim that the use was to identify

the markholder’s goods or services is analogous to the statutory

fair-use defense, it is in actuality a claim that the use is

noninfringing and thus creates no likelihood of confusion.12


above arguments would likely prevail. See Elvis Presley Enters.,
141 F.3d at 203 (noting that lack of intent does not weigh
against a likelihood of confusion and fails to swing the balance
away from infringement); cf. id. at 197-98 (noting that a
trademark must be considered in context as used with other
marks).
     12
        The fair-use defense allows a party to use its own name
or a descriptive term or device in the name or term’s descriptive
sense to describe its own goods or services. See 15 U.S.C.
§ 1115(b)(4). Use of the term or name as a mark defeats the
defense. See id.; RESTATEMENT, supra, § 28 cmt. a. The fair-use
defense is limited “to use of the original descriptive or
personal name significance of a term.” See id. § 28 & cmt. a;
see also 15 U.S.C. § 1115(b)(4); Soweco, 617 F.2d at 1185. It
does not apply to the use of a term as a mark to identify the
markholder’s goods or services. See id. §§ 20 cmt. b, 28 cmt. a.
Unlike the use to identify the markholder’s goods or services, a

                                 37
     Courts have long recognized that one who has lawfully copied

another’s product can tell the public what he has copied.          See

Saxlehner v. Wagner, 216 U.S. 375, 380 (1910); see also, e.g.,

Hypertherm, Inc. v. Precision Prods., Inc., 832 F.2d 697, 700-01

(1st Cir. 1987) (stating that a copyist may use the originator’s

mark to identify the product that it has copied); Calvin Klein

Cosmetics Corp. v. Lenox Lab., Inc., 815 F.2d 500, 503 (8th Cir.

1987) (same); G.D. Searle & Co. v. Hudson Pharm. Corp., 715 F.2d

837, 842-43 (3d Cir. 1983) (same); Smith v. Chanel, Inc., 402

F.2d 562, 563 (9th Cir. 1968) (same); Societe Comptoir de

l’Industrie Cotonniere Etablissements Boussac v. Alexander’s

Dep’t Stores, Inc., 299 F.2d 33, 35-37 (2d Cir. 1962) (same);

RESTATEMENT, supra, § 20 cmt. b, at 209-10.   Likewise, one can use

another’s mark truthfully to identify another’s goods or services

in order to describe or compare its product to the markholder’s

product.   See, e.g., August Storck K.G. v. Nabisco, Inc., 59 F.3d

616, 617-18 (7th Cir. 1995); New Kids on the Block v. News Am.

Publ’g, Inc., 971 F.2d 302, 306-09 (9th Cir. 1992); see also

RESTATEMENT, supra, § 20 cmt. b, at 209-10; 3 MCCARTHY   ON   TRADEMARKS,

supra, § 25:51-:52.   This right to use a mark to identify the

markholder’s products--a nominative use--however, is limited in



fair use of a term may be protected even if a likelihood of
confusion exists. See id. § 28 cmt. b. Otherwise, a markholder
could “appropriate a descriptive term for his exclusive use and
so prevent others from accurately describing a characteristic of
their goods.” Soweco, 617 F.2d at 1185.

                                 38
that the use cannot be one that creates a likelihood of confusion

as to source, sponsorship, affiliation, or approval.          See, e.g.,

August Storck, 59 F.3d at 618; New Kids on the Block, 971 F.2d at

308; Hypertherm, 832 F.2d at 700-01; Calvin Klein, 815 F.2d at

503; G.D. Searle, 715 F.2d at 842; see also RESTATEMENT, supra,

§ 20 cmt. b, at 209-10; 3 MCCARTHY    ON   TRADEMARKS, supra, § 25:51-

:52.

       As the Ninth Circuit has recognized, where a nominative use

of a mark occurs without any implication of affiliation,

sponsorship, or endorsement--i.e., a likelihood of confusion--the

use “lies outside the strictures of trademark law.”          New Kids on

the Block, 971 F.2d at 308.    In order to avail itself of the

shield of nominative use, the defendant (1) may only use so much

of the mark as necessary to identify the product or service and

(2) may not do anything that suggests affiliation, sponsorship,

or endorsement by the markholder.      See id. at 30813; cf. B.H.

Bunn, 451 F.2d at 1263-64 (holding that references to a

competitor’s numbering system and prices are allowable only if

solely used for comparison).    By definition, the defendant cannot

use the mark to identify its goods because this would not be a

       13
        New Kids on the Block also held that “the product or
service in question must be one not readily identifiable without
use of the trademark.” 971 F.2d at 308. We decline to impose
this requirement because, in the circumstance before us of direct
comparative advertising used to identify what was copied, it
will always be satisfied. We express no opinion as to whether
this requirement should or should not be imposed in other
circumstances of claimed nominative use.

                                 39
nominative use, and it would also suggest affiliation,

sponsorship, or endorsement.

     The district court found that Tour 18 used the Plaintiffs’

marks as service marks to name its own products and to

distinguish them from those offered by other golf courses.      See

Pebble Beach, 942 F. Supp. at 1553.   Based upon the prominent use

of the Plaintiffs’ marks in its advertising and promotional

material, use of the marks on its menu, and use of the marks on

signs directing players to each tee, Tour 18 has used the marks

in ways suggesting affiliation, sponsorship, or approval.      See

Sands, Taylor & Wood Co. v. Quaker Oats Co., 978 F.2d 947, 953-54

(7th Cir. 1992) (holding that use of a mark as an “attention-

getting symbol” in advertising was not a fair use); Lindy Pen Co.

v. Bic Pen Corp., 725 F.2d 1240, 1248 (9th Cir. 1984) (holding

that prominent placement of a mark on product was a trademark

use); Beer Nuts, Inc. v. Clover Club Foods Co., 711 F.2d 934,

937-38 (10th Cir. 1983) (same); cf. RESTATEMENT, supra, § 13

cmt. c, at 110 (noting that prominent use of a term in

advertising is a way to indicate source--i.e., a trademark use).

Therefore, the district court did not clearly err in finding that

Tour 18 had used the Plaintiffs’ marks in a service-mark context

on its own products and services and did not err in denying Tour

18 the shield of nominative use.

     In addition, Tour 18 argues that, because the allowable use

of a mark in comparative advertising (a nominative use) will

                                40
normally result in a positive finding among a majority of the

digits of confusion, the traditional likelihood-of-confusion

analysis cannot be applied.   However, implicit in this argument

is a misunderstanding of the likelihood-of-confusion analysis.

The digits of confusion “are not an end in themselves, and all

are not of equal significance.    The [digits] serve only as guides

on the analytical route to the ultimate determination of whether

confusion is likely to result.”    Champions Golf Club, 78 F.3d at

1122; see also Falcon Rice Mill, Inc. v. Community Rice Mill,

Inc., 725 F.2d 336, 345 n.9 (5th Cir. 1984) (“[I]t is clear that

some factors are more important than others and that they may

have different weight in different cases.”).   Additionally, a

court is not limited to considering only the standard digits of

confusion and should consider other relevant factors in its

analysis.   See Elvis Presley Enters., 141 F.3d at 194.

Furthermore, as noted earlier, a positive finding on a majority

of the digits of confusion does not require a court to find a

likelihood of confusion.   See id. at 199.   Therefore, the

traditional likelihood-of-confusion analysis is applicable in a

comparative-advertising situation, but the court should usually

consider the nominative-use claim in conjunction with its

likelihood-of-confusion analysis to avoid lowering the standard

of confusion.14   Because Tour 18 used the Plaintiffs’ marks in

     14
        We do not prescribe any particular method for this
consideration because this case does not present a situation in

                                  41
more than a merely nominative sense, a different approach would

not have altered the result.15


which nominative use is a significant factor in the liability
determination.
     15
        Because we affirm the district court’s finding of
infringement, we likewise affirm its state-law unfair-competition
claim. See Elvis Presley Enters., 141 F.3d at 193 (noting that
the likelihood-of-confusion determination under Texas law for
unfair competition based upon infringement is the same as under
federal law).

     Additionally, Tour 18 and the Plaintiffs’ challenges to the
district court’s findings on dilution have no merit. Dilution
can be shown by way of two different theories: blurring and
tarnishment. See 3 MCCARTHY ON TRADEMARKS, supra, § 24:67-:69; see
also RESTATEMENT, supra, § 25 (referring to the theories
respectively as “dilution” and “tarnishment”). The district
court found that Tour 18 had diluted the Plaintiffs’ marks under
a theory of blurring, but that it had not diluted their marks
under a theory of tarnishment. See Pebble Beach, 942 F. Supp. at
1566-67. Tour 18’s challenge to the district court’s finding of
dilution by blurring was based only upon the protectibility of
the marks, which we affirmed above. Moreover, Tour 18 did not
challenge whether the Plaintiffs’ marks and trade dress were
sufficiently famous to support a dilution claim. See RESTATEMENT,
supra, § 25(1)(a) & cmt. e.

     The Plaintiffs’ challenge to the district court’s finding of
no dilution by tarnishment rests upon the argument that Tour 18’s
replicas are not as difficult or as beautiful as the original
golf holes and that Tour 18’s claim that its golf holes are
replicas tarnishes their images. The Plaintiffs’ brief argument,
buried in their challenge to the injunction, is that this type of
association supports a finding of tarnishment. The district
court recognized that this association may support a claim of
dilution by tarnishment but found that such dilution does not
exist in this case because any shortcomings would be attributed
to Tour 18 and not to the Plaintiffs. See Pebble Beach, 942
F. Supp. at 1566-67; cf. Smith, 402 F.2d at 569 (noting that,
because the defendants make it clear that the product is their
own, “[i]f [the product] proves to be inferior, they, not [the
plaintiffs], will bear the burden of consumer disapproval”).
Therefore, the district court committed no legal error which
would allow us to review its finding on dilution by tarnishment
under a less deferential standard of review than clear error, and

                                 42
                      5.   Effect of Sears-Compco

     In addition to its attack on the district court’s

traditional trade-dress analysis, Tour 18 contends that it has

the unfettered right to copy the Plaintiffs’ golf-hole designs

and lighthouse under the Intellectual Property Clause of the

Constitution.   See U.S. CONST. art. I, § 8, cl. 8.     Tour 18 points

to Sears, Roebuck & Co. v. Stiffel Co., 376 U.S. 225 (1964), and

Compco Corp. v. Day-Brite Lighting, Inc., 376 U.S. 234 (1964), to

demonstrate that unfair-competition law cannot protect product

designs or configurations to which no current, valid patent

applies.   We disagree.

     First, Sears and Compco, both decided the same day,

concerned the preemption of state trade-dress protection by

federal patent law and barred the use of state unfair-competition

laws to prohibit the copying of products that are not protected

by federal patents.    See Sears, 376 U.S. at 231-32 (copying of a

lamp); Compco, 376 U.S. at 237-38       (copying of a reflector for a

fluorescent light fixture).     This bar to state prohibitions on

copying includes nonfunctional designs and designs that have

achieved secondary meaning.     See Compco, 376 U.S. at 238.

However, the Supreme Court noted that “other federal statutory



the Plaintiffs have failed to demonstrate that the district court
clearly erred in its factual findings on dilution by tarnishment.
Therefore, we affirm the district court’s finding of no dilution
by tarnishment because we have no definite or firm conviction
that a mistake has been made.

                                   43
protection,” in addition to the patent laws, may bar copying of a

product.   See id. at 238.   In Bonito Boats, Inc. v. Thunder Craft

Boats, Inc., 489 U.S. 141 (1989), the Supreme Court reaffirmed

its Sears-Compco holdings that limit state protection of product

designs and noted that the application of Sears-Compco to

nonfunctional product design must take into account competing

federal policies as evidenced by the Lanham Act.    See id. at 166.

Thus, federal trademark protection is not limited by the

preemption holdings in Sears-Compco.    See Thomas & Betts Corp. v.

Panduit Corp., 138 F.3d 277, 286 (7th Cir. 1998) (noting that the

Sears-Compco and Bonito Boats holdings have no effect on the

scope of federal trademark or unfair-competition law), petition

for cert. filed, 67 U.S.L.W. 3152 (U.S. July 28, 1998) (No. 98-

179).

     Second, the federal trademark laws are “other federal

statutory protection,” and their protection of product designs

and configurations does not conflict with the federal patent laws

or the Intellectual Property Clause.   The patent laws and the

trademark laws have two entirely different and consistent

purposes, addressing entirely different concerns.    See generally

Thomas & Betts, 138 F.3d at 283-89 (discussing the origins and

competing policies of the patent and trademark laws).   The patent

laws serve (1) “to foster and reward invention,” (2) “to

promote[] disclosure of inventions to stimulate further

innovation and to permit the public to practice the invention

                                 44
once the patent expires,” and (3) “to assure that ideas in the

public domain remain there for the free use of the public.”

Aronson v. Quick Point Pencil Co., 440 U.S. 257, 262 (1979); see

also Duraco Prods., 40 F.3d at 1446 (noting that the policy of

encouraging innovative designs is the province of the patent and

copyright laws).   The principal purposes of the trademark laws

are to avoid consumer confusion and to protect the goodwill of

the trademark owner’s business.    See Park ’N Fly, Inc. v. Dollar

Park & Fly, Inc., 469 U.S. 189, 198 (1985); Duraco Prods., 40

F.3d at 1446 n.10.

     While the federal trademark laws provide a trademark or

trade-dress owner indefinite protection unlike the limited-

duration protection provided by the patent laws, traditional

trade-dress analysis limits the scope of product designs or

configurations that can be protected to avoid conflict between

the two areas of law.   See Kohler Co. v. Moen Inc., 12 F.3d 632,

642 (7th Cir. 1993) (“[A]ny conflicts between the patent laws and

the Lanham Act should be resolved by a careful application of

traditional bases for determining the propriety of trademark

protection such as likelihood of confusion, functionality, and

distinctiveness.”); see also Qualitex, 514 U.S. at 164-65 (noting

that the functionality doctrine prevents trademark law from

inhibiting legitimate competition by protecting useful product

features, which is the province of patent law); Duraco Prods., 40

F.3d at 1451; W.T. Rogers Co. v. Keene, 778 F.2d 334, 337 (7th

                                  45
Cir. 1985) (noting that the defense of functionality prevents any

conflict between the federal patent and trademark laws,

especially with a trade-dress infringement suit requiring

secondary meaning (i.e., distinctiveness) and a likelihood of

confusion).

     Third, in the more than thirty years since Sears-Compco,

Congress and the courts have recognized that federal unfair-

competition law provides protection to product designs and

configurations consistent with the patent laws.         See Bonito

Boats, 489 U.S. at 166.        Courts have developed federal unfair-

competition law and have protected product designs and

configurations.        See, e.g., American Greetings Corp. v. Dan-Dee

Imports, Inc., 807 F.2d 1136 (3d Cir. 1986) (teddy bears);

LeSportsac, Inc. v. K Mart Corp., 754 F.2d 71 (2d Cir. 1985)

(luggage); Ideal Toy Corp. v. Plawner Toy Mfg. Corp., 685 F.2d 78

(3d Cir. 1982) (Rubik’s Cube); Truck Equip. Serv. Co. v. Freuhauf

Corp., 536 F.2d 1210 (8th Cir. 1976) (semi-truck trailer); see

also 1 MCCARTHY   ON   TRADEMARKS, supra, §§ 7:54, 8:4-:5; cf. id.

§§ 7:94-:95 (noting that, since Sears-Compco, product designs and

configurations have been allowed registration on both the

principal and supplemental registers).         In the face of this

developing protection for product designs and configurations,

Congress reenacted in 1988 the definition of trademark to include

“any word, name, symbol, or device, or any combination thereof,”

15 U.S.C. § 1127.        See Qualitex, 514 U.S. at 172-73.   The Supreme

                                      46
Court found in Qualitex that the reenactment of this language--

along with its legislative history explicitly referring to the

Trademark Commission’s recommendation that the terms “symbol, or

device” be left unchanged to allow registrations of color, shape,

smell, sound, or configuration that function as a mark--undercut

restrictive trademark precedent.           See id.   Thus, Congress and the

Court have embraced a broad reading of the Lanham Act and its

protections, which can encompass product designs and

configurations.

     For the above reasons, the Intellectual Property Clause, the

federal patent laws, and the Sears-Compco-line of cases do not

preclude federal trademark protection for product designs and

configurations.   Accord, e.g., Kohler, 12 F.3d at 639-41; Ferrari

S.P.A. Esercizio Fabriche Automobili E Corse v. Roberts, 944 F.2d

1235, 1240-41 (6th Cir. 1991); Keene Corp. v. Paraflex Indus.,

Inc., 653 F.2d 822, 823 n.1 (3d Cir. 1981); see also Kohler, 12

F.3d at 640 n.10 (noting that the Lanham Act differs in many

respects from the state unfair-competition law at issue in Sears-

Compco); 1 MCCARTHY   ON   TRADEMARKS, supra, § 7:61.   But see Kohler, 12

F.3d at 644-51 (Cudahy, J., dissenting); Ferrari, 944 F.2d at

1252-53 (Kennedy, J., dissenting); cf. Vornado Air Circulation

Sys., Inc. v. Duracraft Corp., 58 F.3d 1498, 1510 (10th Cir.

1995) (finding that a nonfunctional feature that is part of a

claim in a utility patent cannot be protected by federal



                                      47
trademark law),16 cert. denied, 516 U.S. 1067 (1996).17

     Finally, if the acid test of any theory is how it works in

     16
        In Vornado, the court found that a feature was both
patentable and nonfunctional. See 58 F.3d at 1506. The decision
has been criticized for its narrow definition of functionality
which does not take into account the utilitarian definition used
by this court. See 1 MCCARTHY ON TRADEMARKS, supra, § 7:68, at 7-
134 to 7-136. Therefore, if Vornado had applied this court’s
traditional trade-dress analysis, any conflict between the patent
and trademark laws would have likely been avoided.
     17
        Tour 18 contends that this court’s decision in North
Shore Laboratories Corp. v. Cohen, 721 F.2d 514 (5th Cir. 1983),
controls our resolution of the effect of Sears-Compco. In North
Shore Laboratories, the plaintiff and the defendant both made a
brown tire-patch material, and the plaintiff argued that, based
upon a consent judgment, the defendant should be prohibited from
making a tire-patch material the same color as its own. See id.
at 516-18. Solely by interpreting the judgment, the court
determined that the defendant had not violated the consent
judgment through the manufacture and sale of his product. See
id. at 518-21. After resolving the question before it, the court
alternatively considered whether it could have enforced the
consent judgment if the judgment had prohibited the defendant’s
conduct. See id. at 521-24. The court looked to Sears-Compco
for the public policy that the copying of unpatented products is
permitted and promotes free competition. See id. at 522. It
found that an injunction which barred the defendant’s manufacture
and sale of a brown tire-patch product would conflict with this
public policy.

     North Shore Laboratories’s alternative holding that a
product’s color cannot be protected by federal trademark law has
been overruled by subsequent Supreme Court authority. See
Qualitex, 514 U.S. at 174. As discussed in the text, subsequent
authority and Congress’s reenactment of the broad language in the
definition of a trademark demonstrate that the alternative
rationale of North Shore Laboratories is inconsistent with the
subsequent development of federal trademark law. We note,
however, that the result of the North Shore Laboratories
decision’s alternative holding would hold true today, without its
discussion of Sears-Compco, because the court also found that the
color of the tire-patch material lacked the necessary secondary
meaning and was functional. See North Shore Lab., 721 F.2d at
522-23. Each of these findings would independently bar Lanham
Act protection to the color of the tire-patch product.

                                48
practice, we note that the application of traditional trade-dress

analysis under the Lanham Act to the product configurations at

issue here, the design of the Plaintiffs’ golf holes, has

effectively left intact Tour 18’s right to copy the Plaintiffs’

golf holes, barring only its copying of the lighthouse.

                             B.   Remedies

     On appeal, Tour 18 and the Plaintiffs challenge the district

court’s injunction as being too broad and too narrow,

respectively.   The Plaintiffs also claim error in the district

court’s denial of an accounting of profits and an award of

attorneys’ fees.    We address each of these issues in turn.

                        1.   Injunctive relief

     Under the Lanham Act, the district court has the discretion

to enter an injunction to prevent continued infringement or

unfair competition.    See 15 U.S.C. § 1116(a).      The Texas anti-

dilution statute also provides for injunctive relief to remedy

any dilution.    See TEX. BUS. & COM. CODE ANN. § 16.29 (Vernon Supp.

1998).    We review the district court’s decision whether to grant

or deny an injunction and the scope and form of the injunction

for an abuse of discretion.18     See Frostie Co. v. Dr. Pepper Co.,

361 F.2d 124, 126-27 (5th Cir. 1966).        In reviewing the



     18
         Whether an injunction is mandatory under the Texas anti-
dilution statute is not before us because an injunction has been
entered which, as discussed infra, does not permit diluting
conduct.

                                   49
injunction, it is important to note that, “‘[i]n fashioning

relief against a party who has transgressed the governing legal

standards, a court of equity is free to proscribe activities

that, standing alone, would have been unassailable.’”   Taco

Cabana, 932 F.2d at 1126 (quoting Kentucky Fried Chicken Corp. v.

Diversified Packaging Corp., 549 F.2d 368, 390 (5th Cir. 1977)).

     The district court entered an injunction against Tour 18

limiting its use of the Plaintiffs’ marks, depictions of the

lighthouse, Sea Pines’s trade dress, and claims that original

blueprints or maps were used and requiring it to remove the

replica lighthouses from both of its courses.19   The district

     19
        The complete text of the district court’s amended
injunctive order follows:

          (1) Defendant and all persons in active concert or
     participation with defendant are permanently enjoined
     from using in connection with the promotion,
     advertising, or sale of golfing services, the service
     marks “HARBOUR TOWN,” “HARBOUR TOWN GOLF LINKS,” or any
     depiction or photo of the Harbour Town lighthouse.

          (2) Defendant and all persons in active concert or
     participation with defendant are permanently enjoined
     from offering in connection with defendant’s golf
     course services a replica, copy, or imitation of the
     Harbour Town lighthouse. Tour 18 is ordered to remove
     its replicas of the Harbour Town lighthouse from all
     Tour 18 golf courses. However, Tour 18 is not required
     to alter the playable surface of the golf holes in
     question.

          (3) Defendant and all persons in active concert or
     participation with defendant are permanently enjoined
     from using in connection with the promotion,
     advertising, or sale of golfing services, the service
     marks “PEBBLE BEACH,” “PEBBLE BEACH GOLF LINKS,”
     “PINEHURST,” or “PINEHURST No. 2,” except that

                                50
defendant may use these marks only to the limited
extent necessary to inform the public which golf holes
it copied. To comply with this section of the
injunction, Tour 18 may use plaintiffs’ marks on its
scorecard, yardage guide, and tee box signs.
Additionally, Tour 18 may place these service marks in
other printed materials only within a simple legend of
the course’s replicated golf holes. This legend shall
include only the Tour 18 hole number, name of
replicated hole, par, and yardage, similar to the
legend contained within Tour 18’s current promotional
brochure, specifically plaintiff's exhibit 103. Tour
18 must remove all other superfluous uses of the marks
listed in this section from its written materials,
including but not limited to, the Tour 18 promotional
brochures, mailers, advertisements in independent
publications, and restaurant menu.

     (4) Defendant shall place a disclaimer prominently
and in bold lettering on the front of all
advertisements, promotional brochures, scorecards,
yardage guides, or other written materials provided to
the public as a means of marketing Tour 18. The
disclaimer shall disclaim any association, affiliation,
sponsorship, or permission from the owners of the golf
holes Tour 18 copied. Tour 18 shall maintain use of
the disclaimers that currently appear on its tee box
signs.

     (5) Defendant is enjoined from using any
advertisement or promotional statement claiming it used
“original” blueprints, maps, or other data to construct
its replica golf holes, except that defendant may use
such a statement if it also includes a disclaimer
clearly stating that it neither received the blueprints
or maps from the owners of the original golf holes or
that the owners of the original golf holes authorized
Tour 18’s use of such blueprints or maps.

     (6) Defendant shall have thirty days from the
entry of final judgment to comply with the provisions
of this injunction.

     (7) All additional relief requested by plaintiffs
and defendant not specifically granted herein is
denied.


                          51
court allowed Tour 18 continued use of Pebble Beach and

Pinehurst’s marks to inform the public of which golf holes it has

copied, but the district court did not allow the same exception

in relation to Sea Pines’s marks.

     Tour 18 argues that the district court’s injunction is an

abuse of discretion because (1) it limits legal activity that

does not infringe or dilute the Plaintiffs’ marks and (2) it is

vague in its requirements.   Specifically, Tour 18 argues that

     a.   paragraph (1) impermissibly bars its use of Sea Pines’s
          marks, “Harbour Town” and “Harbour Town Golf Links,”
          without allowing for Tour 18’s right to use the marks
          in truthful comparative advertising;

     b.   paragraph (2) is vague as to what “remove its replicas
          of the Harbour Town lighthouse from all Tour 18 golf
          courses” means, in that it is unclear whether this
          means “remove the entire lighthouse structure including
          its foundation; alter the lighthouse to look like a
          water tower, a different lighthouse or something other
          than a lighthouse; or just paint the red stripes
          black”;

     c.   paragraph (3) is overly broad in that it only allows
          Tour 18 to use Pebble Beach and Pinehurst’s marks to
          identify the golf holes it has copied and not in any
          other comparative advertising sense, such as to claim
          that its course is more fun than Pinehurst or Pebble
          Beach;20 and

     d.   paragraph (5) is overly broad in limiting Tour 18’s use
          of claims of having used “maps or other data” in


Pebble Beach, 942 F. Supp. at 1577-78.
     20
        Tour 18 also argues that the term “superfluous” in
paragraph (3) is vague, but by our reading of the paragraph and
“superfluous” in context, we find a clear meaning. The district
court’s requirement that all superfluous uses of the Plaintiffs’
marks must be removed means that uses not expressly allowed are
enjoined.

                                52
           recreating its golf holes in that this limitation
           precludes Tour 18 from making claims based upon maps
           and blueprints created by its own efforts.

Tour 18’s challenges to paragraphs (1) and (3) will be considered

in relation to the Plaintiffs’ related challenges to the

injunction.   Tour 18’s challenges to paragraphs (2) and (5) can

be resolved by a cursory reading of the district court’s opinion

and of the injunction.

     In relation to paragraph (2), “remove” means “to change or

shift the location, position, station, or residence of,” which

does not include any connotation of alteration.         See WEBSTER’S

THIRD NEW INTERNATIONAL DICTIONARY, supra, at 1921.   The district

court’s amended injunction requires the complete removal of the

structure from the golf course.      This meaning is clear from the

fact that the district court, in its original injunction, allowed

for the parties to work out a solution that could include

altering the structure, and when this failed, it ordered that the

structure be removed.     See Pebble Beach, 942 F. Supp. at 1573,

1576-77.   The district court’s decision to order the removal of

the replica lighthouses when a satisfactory alteration could not

be agreed upon was not an abuse of discretion.

     In relation to paragraph (5), the plain language of the

injunction does not bar all mention of any blueprints, maps, or

other data.   The injunction by its own language only limits

references to “original” blueprints, maps, or other data, which

does not include such items created by Tour 18.        Tour 18 also

                                   53
argues that its blueprint and map claims did not contribute to

confusion, but the district court found that “[l]ikely consumer

confusion is reinforced by Tour 18’s advertisements and

promotional materials which claim original blueprints and maps

were used to copy plaintiffs’ holes.”   Id. at 1545 (emphasis

added).   This finding is not clearly erroneous and supports this

paragraph of the injunction.   Paragraph (5) of the injunction

allows Tour 18 to refer to blueprints and maps it created, but it

must not do so in a way that suggests that they are original

documents or data obtained from the Plaintiffs or that the

Plaintiffs authorized them to use such data.

     The Plaintiffs challenge the district court’s injunction

because it allows Tour 18 to continue activities that contributed

to the infringement and because the injunction fails to provide

relief for their successful dilution claims.   Specifically, the

Plaintiffs argue (1) that, as the district court itself found,

using disclaimers to alleviate any problems is ineffective;

(2) that the injunction allows infringing conduct and dilution to

continue by permitting Tour 18’s continued use of Pebble Beach

and Pinehurst’s marks; and (3) that all uses of the Plaintiffs’

marks must be enjoined because Tour 18 was attempting to “cash

in” on the Plaintiffs’ reputations.

     First, as to disclaimers, the district court found that

disclaimers were ineffective due to their absence or

inconspicuousness on advertisements and promotional materials and

                                54
due to Tour 18’s “prominent use” of the Plaintiffs’ marks.     See

id. at 1551.    In contrast, conspicuous disclaimers that disclaim

affiliation may reduce or eliminate confusion.    See, e.g., Soltex

Polymer Corp. v. Fortex Indus., Inc., 832 F.2d 1325, 1330 (2d

Cir. 1987), cited in Roho, Inc. v. Marquis, 902 F.2d 356, 361

(5th Cir. 1990); cf. Better Bus. Bureau of Metro. Houston, Inc.

v. Medical Dirs., Inc., 681 F.2d 397, 405 (5th Cir. 1982)

(requiring a disclaimer to obviate any confusion).    Therefore,

the district court appropriately used disclaimers as part of its

injunction.

     Second, as to the permitted continued use of the Plaintiffs’

marks, the district court is allowing Tour 18 to use the

Plaintiffs’ marks only to identify the golf holes it copied.      As

noted in Part II.A.4, supra, this nominative use is outside the

strictures of trademark law where it is done without any

implication of affiliation, sponsorship, or approval.    In

addition, a clear nominative use does not create any likelihood

of confusion.    Further, it does not create any possibility of

dilution by blurring because the use is one that links the mark

to the markholder’s goods or services.    Such a use strengthens

rather than blurs the identification of a mark with the

markholder’s goods.    Cf. Smith, 402 F.2d at 569 (holding that the

defendants’ use of the plaintiffs’ mark to identify the

plaintiffs’ product will not endanger the distinctiveness of the

mark).   Therefore, the Plaintiffs’ success on its infringement

                                 55
and dilution claims does not compel enjoining the nominative use

allowed by the district court.

     Similarly, Tour 18’s challenge to the district court’s

complete prohibition of the use of Sea Pines’s marks in paragraph

(1) of the injunction has merit.      For the same reasons that

support Tour 18’s nominative use of Pebble Beach and Pinehurst’s

marks, Tour 18 should be free to use Sea Pines’s marks, other

than the lighthouse, in a nominative manner to identify the golf

hole it has copied.   Additionally, the removal of the lighthouse

should not bar Tour 18 from identifying the golf hole as one

copied from Harbour Town Golf Links.      The lighthouse is part of

Sea Pines’s trade dress, and despite being used by some golfers

as a target, it is not part of the playing aspect of the golf

hole any more than a tree, a mountain, a cloud, power lines, or

other features in the distance are part of the playing aspect of

a golf hole.   To find otherwise would be inconsistent with our

holding that Tour 18 can identify its golf holes as copies of

Pebble Beach and Pinehurst’s golf holes despite differences in

the surroundings.   The district court was concerned “that the

lighthouse is so intertwined with Harbour Town Hole 18 in

golfer’s [sic] minds that they constitute a single overall trade

dress,” Pebble Beach, 942 F. Supp. at 1577, but copying a product

does not necessarily entail copying all aspects of its trade

dress.   The essential parts of Sea Pines’s golf hole are copied,

and Tour 18 should be allowed to tell the public that it has

                                 56
copied the golf hole in a manner that does not cause fraud or

deception.   Cf. Saxlehner, 216 U.S. at 380-81; Smith, 402 F.2d at

567-68.   Therefore, the injunction must be modified to allow Tour

18 to use Sea Pines’s marks (other than the lighthouse), but Tour

18’s use of Sea Pines’s marks shall be limited in the same manner

as its use of Pebble Beach and Pinehurst’s marks is limited.

     Additionally, Tour 18 contends that the district court

fashioned the limitation on its use of the Plaintiffs’ marks too

narrowly by enjoining other proper nominative uses of the marks.

Tour 18 opines that it should be allowed to advertise, “You can

have more fun at TOUR 18 than at Pebble Beach,” relying upon

Better Business Bureau, 681 F.2d 397, and Trail Chevrolet, Inc.

v. General Motors Corp., 381 F.2d 353, 354 (5th Cir. 1967).      In

Trail Chevrolet, the defendants sold used Chevrolets and repaired

Chevrolets, and they could not describe their business without

being able to state those facts.     See 381 F.2d at 354.    Trail

Chevrolet does not compel a broadening of the injunction in this

case, in which the injunction allows Tour 18 the necessary use of

the Plaintiffs’ marks to describe its business and product as a

collection of copies of the Plaintiffs and others’ golf holes.

     In Better Business Bureau, the district court completely

enjoined any use of the plaintiffs’ marks, which was considerably

broader than the scope of conduct that the district court had

adjudicated as misleading.   See 681 F.2d at 399, 404.      This court

determined that this restriction was not “‘reasonably necessary

                                57
to prevent the deception’” at issue and that the remedy should be

to require disclaimers rather than completely prohibit use of the

plaintiffs’ marks.   See id. at 405-06 (quoting In re R.M.J., 455

U.S. 191, 203 (1982)).   In the instant case, Tour 18 has made

generous use of the Plaintiffs’ marks in the past--including

prominent use in its advertising and promotional material and on

its restaurant menus--which has been found to create a likelihood

of confusion by suggesting approval.    Furthermore, even when

consumers were exposed to Tour 18’s disclaimers, the confusion

continued to persist.    See Pebble Beach, 942 F. Supp. at 1549.

Unlike in Better Business Bureau, the district court’s injunction

limits advertising and promotional activity by Tour 18 that has

been adjudicated as misleading, and the use of disclaimers alone

by Tour 18 has been found to be ineffective in preventing a

likelihood of confusion.

     Otherwise unassailable activities may be proscribed where a

party has transgressed the governing legal standard.    See Taco

Cabana, 932 F.2d at 1126; Chevron Chem. Co. v. Voluntary

Purchasing Groups, Inc., 659 F.2d 695, 705 (5th Cir. Unit A Oct.

1981); Kentucky Fried Chicken, 549 F.2d at 390; 5 MCCARTHY     ON

TRADEMARKS, supra, § 30:4.   The district court’s injunction

permits extensive use of the Plaintiffs’ marks by permitting Tour

18 to use the marks to identify the holes it has copied, and the

limitation on uses like the example urged by Tour 18 is



                                  58
minimal.21   In light of the minimal nature of the limitation on

Tour 18’s use of Plaintiffs’ marks and the fact that disclaimers

alone are ineffective, the limitation imposed by the district

court is reasonably necessary to prevent deception based upon the

specific facts of this case.   The district court therefore did

not abuse its discretion by limiting Tour 18’s use of the

Plaintiffs’ marks as described in the injunction.

     Third, the Plaintiffs’ argument that an injunction must

issue because Tour 18 was trying to “cash in” on the Plaintiffs’

fame and reputation has no merit.     In both cases upon which the

Plaintiffs rely, this court enjoined use of trademarks which were

used to identify the defendants’ services and were chosen and

designed specifically to appropriate the plaintiffs’ reputations.

See National Ass’n of Blue Shield Plans v. United Bankers Life

Ins. Co., 362 F.2d 374 (5th Cir. 1966) (enjoining use of logos

similar to the plaintiff’s even in a different color because in

black and white advertising the color would not distinguish the

logo); Aetna Cas. & Sur. Co. v. Aetna Auto Fin. Inc., 123 F.2d

582 (5th Cir. 1941).   In this case, the district court’s

injunction, when modified as required above, will allow only uses


     21
        Our belief that the limitation is minimal is supported
by the fact that Tour 18 challenged only the complete prohibition
of its use of Sea Pines’s marks and not the limitation on its use
of Pebble Beach or Pinehurst’s marks in its motion to the
district court to alter or amend the final judgment.
Additionally, its argument to this court that the injunction is
too broad is brief and cursory.

                                 59
which identify which holes were copied, thereby permitting Tour

18 to try to appropriate the reputation of the goods but not of

the mark or markholder.   See Saxlehner, 216 U.S. at 380-81

(holding that it is proper to attempt to appropriate the goodwill

of the goods, but not the name); see also Ferrari, 944 F.2d at

1243 (“‘Where the copying by one party of another’s product is

not done to deceive purchasers and thus derive a benefit from

another’s name and reputation, but rather to avail oneself of a

design which is attractive and desirable, a case of unfair

competition is not made out.’” (quoting West Point Mfg. Co. v.

Detroit Stamping Co., 222 F.2d 581, 586 (6th Cir. 1955))); Smith,

402 F.2d at 568-69 (noting that the opportunistic copyist’s “free

ride” serves an important public interest of offering comparable

goods at lower prices and that the markholder is not entitled to

monopolize the public’s desire for the unpatented product).

     For the reasons discussed above, we reject nearly all of the

Plaintiffs and Tour 18’s challenges to the district court’s

injunction.   In relation to Tour 18’s use of Sea Pines’s service

marks, we modify paragraphs (1) and (3) of the injunction to read

as follows:

          (1) Defendant and all persons in active concert or
     participation with defendant are permanently enjoined
     from using in connection with the promotion,
     advertising, or sale of golfing services, any depiction
     or photo of the Harbour Town lighthouse.

          (3) Defendant and all persons in active concert or
     participation with defendant are permanently enjoined
     from using in connection with the promotion,

                                60
     advertising, or sale of golfing services, the service
     marks “PEBBLE BEACH,” “PEBBLE BEACH GOLF LINKS,”
     “PINEHURST,” “PINEHURST No. 2,” “HARBOUR TOWN,” or
     “HARBOUR TOWN GOLF LINKS,” except that defendant may
     use these marks only to the limited extent necessary to
     inform the public which golf holes it copied. To
     comply with this section of the injunction, Tour 18 may
     use plaintiffs’ marks on its scorecard, yardage guide,
     and tee box signs. Additionally, Tour 18 may place
     these service marks in other printed materials only
     within a simple legend of the course’s replicated golf
     holes. This legend shall include only the Tour 18 hole
     number, name of replicated hole, par, and yardage,
     similar to the legend contained within Tour 18’s
     current promotional brochure, specifically plaintiff's
     exhibit 103. Tour 18 must remove all other superfluous
     uses of the marks listed in this section from its
     written materials, including but not limited to, the
     Tour 18 promotional brochures, mailers, advertisements
     in independent publications, and restaurant menu.

                 2.   Profits and attorneys’ fees

     The district court denied the Plaintiffs’ request for an

accounting of profits and reasonable attorneys’ fees.    See Pebble

Beach, 942 F. Supp. at 1571-72.    The Plaintiffs argue that the

district court abused its discretion in not awarding them profits

and attorneys’ fees, pursuant to 15 U.S.C. § 1117.22

     22
        The Plaintiffs also argue that Pebble Beach and
Pinehurst must be granted an award of treble profits and
attorneys’ fees, pursuant to 15 U.S.C. § 1117(b). However,
§ 1117(b), which provides penalties for the intentional use of
counterfeit marks, does not apply to this case because (1) this
simply is not a counterfeiting case and (2) despite the fact that
Tour 18 intentionally copied the Plaintiffs’ marks and trade
dress, it did not intentionally infringe the Plaintiffs’ marks by
the use of counterfeit marks in attempting to use them to
identify the golf holes it copied. The case upon which the
Plaintiffs rely does not stand for the proposition that any
§ 1114(1)(a) violation triggers the remedies in § 1117(b). That
case is a clear case of intentional counterfeiting. See Dunkin’
Donuts Inc. v. Mercantile Ventures, No. 93-8270, slip op. at 6
(5th Cir. Mar. 7, 1994) (unpublished), on remand, 32 U.S.P.Q.2d

                                  61
                      a.   accounting of profits

       Section 1117(a) of the Lanham Act entitles a markholder to

recover the defendant’s profits, subject to the principles of

equity.    See 15 U.S.C. § 1117(a); Maltina Corp. v. Cawy Bottling

Co., 613 F.2d 582, 584 (5th Cir. 1980).    An award of the

defendant’s profits is not automatic, see Champion Spark Plug Co.

v. Sanders, 331 U.S. 125, 131 (1947); Bandag, Inc. v. Al Bolser’s

Tire Stores, Inc., 750 F.2d 903, 919 (Fed. Cir. 1984), and is

committed to the discretion of the district court, whose decision

we review for an abuse of discretion, see id. at 917, 919.    While

this court has not required a particular factor to be present,

relevant factors to the court’s determination of whether an award

of profits is appropriate include, but are not limited to,

(1) whether the defendant had the intent to confuse or deceive,

(2) whether sales have been diverted, (3) the adequacy of other

remedies, (4) any unreasonable delay by the plaintiff in

asserting his rights, (5) the public interest in making the

misconduct unprofitable, and (6) whether it is a case of palming

off.    See Texas Pig Stands, Inc. v. Hard Rock Cafe Int’l, Inc.,

951 F.2d 684, 695 (5th Cir.) (citing Champion Spark Plug, 331

U.S. at 130; Bandag, 750 F.2d at 919; and Maltina, 613 F.2d at

585), reh’g denied, 966 F.2d 956 (5th Cir. 1992); RESTATEMENT,

supra, § 37.    Once an award is found to be appropriate, a



1460 (W.D. Tex. 1994).

                                  62
markholder is only entitled to those profits attributable to the

unlawful use of its mark.         See Texas Pig Stands, 951 F.2d at 696,

reh’g denied, 966 F.2d at 957-58 (citing Mishawaka Rubber &

Woolen Mfg. Co. v. S.S. Kresge Co., 316 U.S. 203, 206 (1942), and

Meier Brewing Co. v. Fleischmann Distilling Corp., 390 F.2d 117,

124 (9th Cir. 1968)).

     The district court determined that an accounting of profits

was inappropriate based upon (1) the lack of any evidence of lost

or diverted sales, (2) the fact that the Plaintiffs only

partially prevailed, and (3) the adequacy of injunctive relief.

See Pebble Beach, 942 F. Supp. at 1571.          The Plaintiffs argue

that the district court erred in considering the fact that they

only partially prevailed and in its finding that there was no

loss of goodwill.

     The district court did err in placing weight on the fact

that the Plaintiffs partially prevailed in denying an accounting

of profits.        The Supreme Court has held that the burden is upon

the defendant to show that he made no profit from the infringing

use of the mark.        See Mishawaka, 316 U.S. at 206; see also

5 MCCARTHY   ON   TRADEMARKS, supra, § 30:65.   The Court acknowledged

that the plaintiff may receive a windfall, but stated that,

“where it is impossible to isolate the profits” from the

infringing conduct, the windfall should go to the plaintiff

rather than the wrongdoer.         See Mishawaka, 316 U.S. at 206-07.

Therefore, the fact that the Plaintiffs only partially prevailed

                                       63
does not weigh against an accounting of profits.

     Nevertheless, the other relevant factors here still support

the district court’s denial of an accounting of profits.      There

were no diverted sales nor palming off in this case, which are

both significant factors.     See Texas Pig Stands, 951 F.2d at 695;

see also Champion Spark Plug, 331 U.S. at 131 (affirming a denial

of profits where no fraud or palming off was evident).      The

district court also implicitly found that Tour 18’s infringement

was not willful.   See Pebble Beach, 942 F. Supp. at 1571-72

(noting that a case of willful infringement is normally an

appropriate case for an award of profits and not finding such

infringement and indicating, in its discussion of attorneys’

fees, that Tour 18 did not intend to divert sales and had a good-

faith belief that it could copy the golf holes and use the marks

to identify what it copied).    Considering the lack of actual

damages and the lack of an intent to confuse or deceive,

injunctive relief satisfies the equities in this case.       See

Champion Spark Plug, 331 U.S. at 131; Bandag, 750 F.2d at 917;

see also Highway Cruisers of Cal., Inc. v. Security Indus., Inc.,

374 F.2d 875, 876 (9th Cir. 1967) (“One may get just enough

relief to stop the evil where it is apparent no great damage was

done to the complainant.”).    Therefore, we do not find that the

district court abused its discretion in denying the Plaintiffs an

accounting of Tour 18’s profits.       The Plaintiffs’ attack on the

district court’s apparent reliance upon no loss of goodwill does

                                  64
not change this outcome, especially considering that it does not

appear that the district court gave that fact much weight as it

was only mentioned in the summary of its discussion of an

accounting of profits and not in the discussion itself.     See

Pebble Beach, 942 F. Supp. at 1571.

                        b.   attorneys’ fees

     Under the Lanham Act, a court may award reasonable

attorneys’ fees to the prevailing party in “exceptional cases.”

15 U.S.C. § 1117(a).   “An exceptional case is one where the

violative acts can be characterized as malicious, fraudulent,

deliberate, or willful.”     Seven-Up Co. v. Coca-Cola Co., 86 F.3d

1379, 1390 (5th Cir. 1996) (internal quotation marks omitted)

(citing Moore Bus. Forms, Inc. v. Ryu, 960 F.2d 486, 491 (5th

Cir. 1992)).   A district court should consider all the facts and

circumstances in determining whether a case is exceptional.        See

CJC Holdings Inc. v. Wright & Lato, Inc., 979 F.2d 60, 65 & n.2

(5th Cir. 1992) (looking to patent case law for guidance on what

constitutes an exceptional case).      The prevailing party must

demonstrate the exceptional nature of a case by clear and

convincing evidence.   See CJC Holdings, 979 F.2d at 65 (citing

Machinery Corp. of Am. v. Gullfiber AB, 774 F.2d 467, 471 (Fed.

Cir. 1985)).   Once this showing has been made, the district court

may award attorneys’ fees at its discretion.     See id. (citing

Texas Pig Stands, 951 F.2d at 684).    We review the district



                                  65
court’s findings as to whether a case is exceptional for clear

error and its decision on whether to award attorneys’ fees for an

abuse of discretion.     See id.

     An award of attorneys’ fees under § 1117(a) generally

“require[s] a showing of a high degree of culpability on the part

of the infringer, for example, bad faith or fraud.”     Texas Pig

Stands, 951 F.2d at 697.    Deliberate copying does not make a case

per se exceptional.     See CJC Holdings, 979 F.2d at 65-66 (noting

that an unpatented and uncopyrighted product can normally be

copied).   A good-faith effort to create elements of dissimilarity

may render a case unexceptional, see Taco Cabana, 932 F.2d at

1128 (citing with approval Roulo v. Russ Berrie & Co., 886 F.2d

931, 942 (7th Cir. 1989)), and “[a] district court normally

should not find a case exceptional where the party presents what

it in good faith believes may be a legitimate defense,” CJC

Holdings, 979 F.2d at 66 (citing Gustafson, Inc. v. Intersystems

Indus. Prods., 897 F.2d 508, 511 (Fed. Cir. 1990)).

Additionally, lack of damages is an important factor in

determining whether a case is exceptional.     See Texas Pig Stands,

951 F.2d at 697 n.23.

     Relying upon (1) Tour 18’s lack of intent to divert sales,

(2) the lack of evidence of actual damages, (3) Tour 18’s good-

faith belief that it could copy the Plaintiffs’ golf holes and

use their marks to identify the golf holes it copied without

causing confusion, and (4) the closeness of the case and the

                                   66
mixed results achieved by both sides, the district court found

that this case was not an exceptional case allowing for an award

of attorneys’ fees.     See Pebble Beach, 942 F. Supp. at 1571-72.

The Plaintiffs argue that Tour 18 acted in bad faith with the

requisite level of culpability, intentionally trading on the

Plaintiffs’ fame and reputations and that the district court

erred in relying upon a lack of intent to divert sales and upon

the mixed results of the case in determining that the case was

not exceptional.

       While a prevailing party’s mixed results can be handled by

apportioning the attorneys’ fees among the claims, see 5 MCCARTHY

ON   TRADEMARKS, supra, § 30:103, the district court considered the

mixed results as a makeweight indicating (1) that Tour 18’s

conduct was not so egregious that it had no defense and (2) that

it had not taken an unreasonable position.     See Pebble Beach, 942

F. Supp. at 1572.     The fact that the outcome was mixed is

relevant to whether a case is exceptional, but it should not be

accorded great weight in the court’s analysis.     As a makeweight,

the district court did not weigh this fact too heavily in its

determination of whether the case was exceptional.

       As to the other circumstances of the case, the district

court did not clearly err in finding a lack of the requisite

level of culpability because there was no intent on Tour 18’s

part to divert sales, there were no actual damages proven, there



                                  67
was no lack of good faith (as evidenced by Tour 18’s use of

disclaimers, though inadequate), and there were available

legitimate uses of the Plaintiffs’ marks to identify the

Plaintiffs’ products.   See Roulo, 886 F.2d at 942-43 (affirming a

denial of attorneys’ fees where the defendant attempted to create

a similar product and made conscious efforts to create

dissimilarities, which in the end were inadequate); cf. Texas Pig

Stands, 951 F.2d at 697 n.23 (noting the significance of a lack

of actual damages); Taco Cabana, 932 F.2d at 1127-28 (affirming

an award of attorneys’ fees where the defendant acted with the

intent to reduce the plaintiff’s sales); Springs Mills, Inc. v.

Ultracashmere House, Ltd., 724 F.2d 352, 356 (2d Cir. 1983)

(holding attorneys’ fees appropriate where the defendant “adopted

[the plaintiff’s] mark and trade dress for no other purpose than

to obtain a free ride” on the plaintiff’s reputation (emphasis

added)).   This case is unexceptional, and the district court

therefore did not abuse its discretion in denying an award of

attorneys’ fees to the Plaintiffs.

                         III.   CONCLUSION

     For the foregoing reasons, we AFFIRM the district court’s

judgment as modified.   Each party shall bear its own costs on

appeal.




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