                   CARNIVAL BRAND SEAFOOD COMPANY, Plaintiff-Appellant,

                                                     v.

                           CARNIVAL BRANDS, INC., Defendant-Appellee.

                                               No. 98-4126.

                                      United States Court of Appeals,

                                             Eleventh Circuit.

                                               Sept. 3, 1999.

Appeal from the United States District Court for the Southern District of Florida (no. 97-8273-CV-JL), Joan
A. Lenard, Judge.

Before ANDERSON, Chief Judge, MARCUS, Circuit Judge, and MILLS*, Senior District Judge.

        ANDERSON, Chief Judge:

        Carnival Brand Seafood Company ("CBSC") brought this trademark infringement action against

Carnival Brands, Inc. ("CBI"). The district court granted summary judgment for defendant CBI on the ground

that CBSC had failed to raise a genuine issue of material fact with respect to the likelihood of confusion to

the extent of the products as to which CBSC had priority. Plaintiff CBSC now appeals.

                                                 I. FACTS

        Beginning in 1980, Honduran company Mariscos de Bahia, S.A. de C.V. ("Mariscos") began using

the brand name "CARNIVAL" in connection with the sale of fresh and frozen boxed raw shrimp. Mariscos

sold shrimp to various wholesalers and retailers, including food suppliers and restaurants, through Miami

distributor Ludwig Shrimp Co. Ltd. ("Ludwig"). CBSC incorporated as a Delaware corporation (with its

headquarters in Florida) in March 1996, and Mariscos assigned to CBSC all of its rights in the CARNIVAL

mark on October 1, 1996 ("Mariscos Assignment"). CBSC registered the CARNIVAL mark with the Patent

& Trademark Office. CBSC then expanded its CARNIVAL product line to include not merely raw shrimp,

but also pre-packaged entrees such as bacon-wrapped shrimp, shrimp scampi, grouper, red snapper, Caribbean



   *
    Honorable Richard H. Mills, Senior U.S. District Judge for the Central District of Illinois, sitting by
designation.
snapper marinated in lemon pepper sauce, mahi mahi fillets, yellow fin tuna, orange roughy, halibut, lobster

tails, and "surf and turf" (lobster tails with beef tenderloin).

         In addition to the Mariscos Assignment, CBSC also received an assignment of rights in the

CARNIVAL mark from Hi-Seas of Dulac, Inc. ("Hi-Seas"), a Louisiana corporation, on April 17, 1997 ("Hi-

Seas Assignment"). Hi-Seas had begun using the mark "CARNIVAL!" in June 1992 in connection with the

sale of fresh frozen shrimp, cooked shrimp, breaded shrimp, cooked crawfish, and breaded alligator.

Following the Mariscos Assignment, CBSC sued Hi-Seas for trademark infringement. As part of a settlement

of that litigation, Hi-Seas executed the Hi-Seas Assignment.

         Defendant CBI is a New Orleans, Louisiana company that is engaged in the business of selling

prepared Creole or Cajun-type food products. CBI, either by itself or as a sole proprietorship prior to its

incorporation,1 has been engaged in this business since 1990. The original proprietorship sold only chicken

gumbo and seafood gumbo, using the brand name "CARNIVAL" or "CARNIVAL CAJUN CLASSICS."

In December 1992, CBI incorporated and expanded into other pre-cooked seafood products such as shrimp

cakes, crawfish cakes, lobster cakes, and crab cakes. CBI now sells an array of pre-cooked, pre-packaged,

ready-to-eat seafood products and sauces with a Cajun or Creole theme; these products are available in

grocery stores for retail purchase. CBI has promoted its products through a web page on the Internet and on

the home shopping network cable television station QVC.

         Plaintiff CBSC filed the instant action against defendant CBI on April 18, 1997, alleging that by

using the CARNIVAL mark, CBI infringed upon CBSC's trademark. The complaint brought one count of

statutory trademark infringement under the Lanham Act, 15 U.S.C. § 1114, one count of false designation

of origin and unfair competition under the Lanham Act, 15 U.S.C. § 1125(a), and one count of common law

trademark infringement. Plaintiff later filed a motion for a preliminary injunction. The district court, finding

no genuine issue of material fact as to the likelihood of confusion between the sources of plaintiff's and

     1
     For simplicity's sake, we use "CBI" herein to refer to CBI or the sole proprietorship that was its
predecessor in interest.

                                                        2
defendant's products, granted summary judgment for defendant CBI, and denied the motion for a preliminary

injunction as moot.

                                      II. STANDARD OF REVIEW

         We review the district court's grant of summary judgment de novo, with all facts and reasonable

inferences therefrom reviewed in the light most favorable to the nonmoving party. Hale v. Tallapoosa

County, 50 F.3d 1579, 1581 (11th Cir.1995). Summary judgment was due to be granted only if the forecast

of evidence before the district court showed that there was no genuine issue as to any material fact and that

the moving party, i.e., CBI, was entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c).

                                              III. ANALYSIS

        To prevail on a trademark infringement claim, a plaintiff must show (1) that its mark has priority and

(2) that the defendant's mark is likely to cause consumer confusion. Lone Star Steakhouse & Saloon, Inc. v.

Longhorn Steaks, Inc., 122 F.3d 1379, 1382 (11th Cir.1997) (citing Dieter v. B & H Indus. of S.W. Fla., Inc.,

880 F.2d 322, 326 (11th Cir.1989), cert. denied, 498 U.S. 950, 111 S.Ct. 369, 112 L.Ed.2d 332 (1990)).

Plaintiff CBSC itself did not begin to use the CARNIVAL mark until at least as late as 1996. Defendant CBI,

on the other hand, used the CARNIVAL mark (or some variation thereof)2 beginning in 1990. Therefore, any

priority that CBSC claims over CBI with respect to the CARNIVAL mark must have been derived from one

of CBSC's predecessors in interest. Cf. Conagra, Inc. v. Singleton, 743 F.2d 1508, 1511 (11th Cir.1984)

(plaintiff's interest in trademark derived entirely from predecessor company that it had acquired); see

generally 2 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 16:5, at 16-7 & n. 3

(1998) (explaining that an assignee of a trademark steps into the shoes of the assignor and that a company

may "buy[ ] the trademark and associated good will of a company with an early priority date in order to

pre-date the priority of a rival"). That is, it must rest on either the Mariscos Assignment or the Hi-Seas




   2
    Until its incorporation in December 1992, CBI apparently used "CARNIVAL CAJUN CLASSICS."

                                                     3
Assignment.3

A.       The Mariscos Assignment

         The Mariscos Assignment conveyed to CBSC any and all rights that Mariscos had gained from the

use of the CARNIVAL mark in connection with Mariscos' sale of raw shrimp since 1980. In other words,

if Mariscos would have had priority over CBI, then CBSC has priority over CBI as well because CBSC

stepped into Mariscos' shoes. The issue for us to decide is whether CBI established beyond any genuine issue

of material fact that it had priority over Mariscos, and thus over CBSC, with respect to the use of the

CARNIVAL mark for processed seafood entrees and sauces of the type sold by CBI.

         Mariscos was unquestionably the senior user with respect to raw shrimp. However, because Mariscos

never produced or sold processed, ready-to-eat seafood entrees as did CBI, priority in these goods depends

on the application of the "related use" or "natural expansion" theory. As we explained in Tally-Ho, Inc. v.

Coast Community College District, 889 F.2d 1018 (11th Cir.1989),

                  The senior user's rights may extend into uses in "related" product or service markets (termed
         the "related goods" doctrine). Thus, an owner of a common law trademark may use its mark on
         related products or services and may enjoin a junior user's use of the mark on such related uses. The
         doctrine gives the trademark owner protection against the use of its mark on any product or service
         which would reasonably be thought by the buying public to come from the same source, or thought
         to be affiliated with, connected with, or sponsored by, the trademark owner.

Id. at 1023 (citations and internal quotation marks omitted); see also Natural Footwear Ltd. v. Hart,

Schaffner & Marx, 760 F.2d 1383, 1406 (3d Cir.1985) ("[O]nce one has established a common law trademark

in a product, the prior use of that trademark will apply as well to the use of the same trademark on related

products in ascertaining priority of use." (emphasis omitted)), cert. denied, 474 U.S. 920, 106 S.Ct. 249, 88

L.Ed.2d 257 (1985); May Dep't Stores Co. v. Prince, 200 U.S.P.Q. 803, 808-09 (T.T.A.B.1978) (senior user

possesses rights in mark superior to those of "a subsequent user of the same or a similar mark for any goods

which purchasers might reasonably be likely to assume emanate from [senior user] in the normal expansion



     3
    CBI does not argue on appeal that either the Mariscos Assignment or Hi-Seas Assignment was invalid
or ineffective. Indeed, the only arguments on appeal involve the scope of rights conveyed in each.

                                                       4
of its business under the mark notwithstanding that the expansion to a particular product might be subsequent

in time to that of another party"); see generally 2 McCarthy § 16:5, at 16-7 ("When a senior user of a mark

on product line A expands later into product line B and finds an intervening user, priority in product line B

is determined by whether the expansion is 'natural' in that customers would have been confused as to source

or affiliation at the time of the intervening user's appearance.").

         On the other hand, "a trademark owner cannot by the normal expansion of business extend the use

or registration of its mark to distinctly different goods or services not comprehended by its previous use ...

where the result could be a conflict with valuable intervening rights established by another through extensive

use ... of the same or similar mark for like or similar goods and services." American Stock Exchange, Inc.

v. American Express Co., 207 U.S.P.Q. 356, 364 (T.T.A.B.1980). See, e.g., Physicians Formula Cosmetics,

Inc. v. West Cabot Cosmetics, Inc., 857 F.2d 80, 82 n. 1 (2d Cir.1988) (defendant's prior use of mark on

hard-bar soap did not extend to give defendant priority to use similar mark in connection with cosmetics and

skin creams, and so intervening user with respect to cosmetics and skin creams had priority); Clark &

Freeman Corp. v. Heartland Co. Ltd., 811 F.Supp. 137, 142 (S.D.N.Y.1993) (where plaintiff had senior rights

to "HEARTLAND" mark with respect to women's boots, those rights did not extend to give plaintiff priority

over defendant's intervening use of "HEARTLAND" with respect to shirts, sweaters, trousers, and jackets,

because at the time the intervening use began, "there was no real likelihood that plaintiffs would bridge the

gap by applying the 'Heartland' label to the types of products defendants were selling").

        Thus, the determinative question is whether—as of the time CBI began using CARNIVAL (or some

variation thereof) for seafood gumbo and chicken gumbo in 1990, and as a secondary matter, as of the time

CBI began using CARNIVAL for shrimp cakes, crawfish cakes, lobster cakes, and crab cakes in 1992—the

buying public might reasonably have been confused as between CBI's products and the raw shrimp sold by

Mariscos under the CARNIVAL mark. To say that such confusion would have existed is another way of

saying that the market for CBI's products would have been within the realm of natural expansion for



                                                       5
Mariscos.

         Tally-Ho instructs that in examining this question for the purpose of determining priority, we apply

a variant of the familiar seven-factor test that pertains to the likelihood of confusion.4 Tally-Ho, 889 F.2d at

1027. As McCarthy explains, "[t]he 'natural expansion' thesis seems to be nothing more than an unnecessarily

complicated application of the likelihood of confusion of source or sponsorship test to a particular factual

situation. If the 'intervening' use was likely to cause confusion, it was an infringement, and the senior use has

the right to enjoin such use, whether it had in fact already expanded itself or not." 4 McCarthy § 24:20, at

24-39; cf. Rosenthal, A.G. v. Ritelite, Ltd., 986 F.Supp. 133, 140-44 (S.D.N.Y.1997) (analyzing whether

plaintiff's senior use of "ROSENBERG" mark with respect to china, dinnerware, glassware, and flatware

extended to give plaintiff priority over intervening user in Judaica (i.e., household goods such as china

commemorating Jewish culture) market, and applying a likelihood-of-confusion inquiry to determine whether

Judaica products were "a natural expansion or continuation of [plaintiff's] existing product line").

         The seven factors that this Circuit uses for determining the likelihood of confusion are (1) the type

of mark; (2) the similarity of the two marks; (3) the similarity of the goods; (4) the identity of customers

and similarity of retail outlets, sometimes called the similarity of trade channels; (5) the similarity of

advertising; (6) the intent, i.e., good or bad faith, of the alleged infringer; and (7) evidence of actual

confusion, if any. Tally-Ho, 889 F.2d at 1027; Freedom Sav. & Loan Ass'n v. Way, 757 F.2d 1176, 1182

(11th Cir.), cert. denied, 474 U.S. 845, 106 S.Ct. 134, 88 L.Ed.2d 110 (1985). Of course, when we use this

test to analyze a priority question, we must consider the state of events that existed at the time the intervening

  4
   The likelihood-of-confusion test, when applied at this stage in order to determine priority where there are
issues of related use, does not substitute for the likelihood-of-confusion test that controls whether
infringement of the plaintiff's trademark is occurring or has occurred. These are two independent inquiries.
Once priority in the use of a mark for a particular class of goods or services has been established, then it is
necessary to perform the likelihood-of-confusion test, as of the current time and as between the plaintiff's
current products (i.e., those that inherit the priority with respect to the previously used mark) and the allegedly
infringing products of the defendant, to determine whether the plaintiff ultimately prevails in a trademark
infringement litigation. See Viking Boat Co., Inc. v. Viking Camper Supply, Inc., 191 U.S.P.Q. 297, 302-03
(T.T.A.B.1976) (distinguishing between the relevance of the likelihood-of-confusion test at the priority stage
and at the stage of determining current confusion).

                                                        6
use (i.e., CBI's use of CARNIVAL) commenced.5 See Viking Boat Co., Inc. v. Viking Camper Supply, Inc.,

191 U.S.P.Q. 297, 303 (T.T.A.B.1976) ("[T]he question of natural expansion must be viewed not in light of

present trade practices but rather what they were in 1961 when [the intervening user] began to do business

under the mark 'VIKING'."). We conclude that there are genuine issues of material fact whether it would

have been natural in 1990 for Mariscos to expand into seafood gumbo and chicken gumbo, and in 1992 for

Mariscos to expand into shrimp cakes, crawfish cakes, lobster cakes, and crab cakes. Stated another way, we

conclude that there are genuine issues of material fact whether there was a likelihood of confusion stemming

from CBI's use of the CARNIVAL brand in 1990 in connection with seafood gumbo and chicken gumbo, and

in 1992 in connection with shrimp cakes, crawfish cakes, lobster cakes, and crab cakes.

          We begin with the first factor of the seven-factor test. The strength of a mark depends on the logical

correlation between a name and a product. Freedom Savings, 757 F.2d at 1182. If the seller of a product or

service would naturally use a particular name, it is weakly protected. Id. The relationships between names

and products fall into several classifications: generic, descriptive, suggestive, arbitrary or fanciful, and

coined. Id. CARNIVAL would be arbitrary or fanciful as compared to raw shrimp because it is "a word in

common usage applied to a service unrelated to its meaning." Id. at 1183 n. 5.6 Second, the marks are

identical.7 Third, although, on the one hand, raw shrimp is certainly different from seafood gumbo and



  5
   Because there are really two separate instances of intervening use, we look both at 1990 (when CBI began
selling chicken gumbo and seafood gumbo) and 1992 (when CBI began selling shrimp cakes, crawfish cakes,
lobster cakes, and crab cakes).
   6
    On the other hand, the strength of the CARNIVAL mark is diminished somewhat by the fairly frequent
use of the CARNIVAL mark by third parties in other markets, as demonstrated by defendant CBI. See Sun
Banks of Fla. v. Sun Fed. Sav. & Loan Ass'n, 651 F.2d 311, 316 (5th Cir.1981) (noting that the use of the
word "Sun" by third parties in other lines of business tended to reduce the strength of the "SUN" mark with
respect to financial services).
      7
    Some evidence indicates that during its formative years, CBI used "CARNIVAL CAJUN CLASSICS"
rather than "CARNIVAL." Although CARNIVAL CAJUN CLASSICS is different from CARNIVAL, the
word "carnival" is the most prominent identifying feature in the former. CBI has not argued to this Court that
the presence of the additional words "cajun classics" prior to 1992 undermined the similarity, though CBI
does contend that references on its packaging to Louisiana separate its mark apart.

                                                       7
shrimp cakes, crawfish cakes, lobster cakes, and crab cakes; on the other hand, all of these are food products

and are related to seafood.8 The very existence of the "related goods" or "natural expansion" doctrine

contemplates that the goods need not be exactly alike, and that the senior user may reasonably expand into

related goods. Cf. J.C. Penney Co., Inc. v. Security Tire & Rubber Co., Inc., 382 F.Supp. 1342, 1344

(E.D.Va.1974) (holding that under the natural expansion doctrine, plaintiff's priority that came from using

the mark "SCAT-TRAC" in connection with bicycle tires extended to automobile tires, even though plaintiff

did not actually start using "SCAT-TRAC" for automobile tires until after other parties did so).

          The fourth factor involves the identity of purchasers and similarity of retail outlets. The evidence

before the district court indicated that Mariscos sold its raw shrimp to distributor Ludwig, who in turn sold

it to retail outlets and wholesalers including grocery stores (e.g., Winn Dixie and Giant), fish stores, and

restaurants (e.g., Red Lobster and King Fish), which in turn would sell it to end consumers in piles of raw

shrimp behind seafood counters (or, in the case of restaurants, would presumably incorporate it into a

prepared dish). The evidence indicated that the name CARNIVAL was used in connection with these sales

to retail outlets and wholesalers, but not that the word CARNIVAL was used at any further stage in the

distribution chain.9 There is nothing to suggest that end users would have associated the CARNIVAL brand


  8
   As aptly noted in CBSC's brief, CBI's reasoning emphasizing the distinction between shrimp and seafood
gumbo could lead to untenable distinctions such as that "the Perdue chicken company cannot prevent
another's use of the PERDUE mark for chicken pot pies, the Dole citrus company cannot prevent another's
use of the DOLE mark for pineapple ice cream, and the Chiquita banana company cannot prevent another's
use of the CHIQUITA mark for banana cream pie." Appellant's Initial Brief at 27.
      9
    At oral argument, counsel for CBSC asserted that the CARNIVAL mark accompanied the piles of raw
shrimp that were displayed in grocery stores and fish markets for retail sale to end users. Counsel also
informed us that Mariscos had sold some shrimp in retail packaging bearing the CARNIVAL name. Counsel
for CBI contended in his rebuttal that these statements lacked factual support in the record. We have
reviewed the summary judgment record, and find the following. First, there is no evidence that the
CARNIVAL mark accompanied the piles of raw shrimp sold at retail. Second, while there is evidence to the
effect that some shrimp were sold by Mariscos in one-pound retail packaging bearing the CARNIVAL name,
the same evidence indicates that said retail packaging began in or around 1996, either at the initiative of
CBSC after it was assigned Mariscos' rights, or only a few months before the Mariscos Assignment. In either
event, retail packaging and the resultant exposure of retail consumers to the CARNIVAL name is not relevant
to our analysis of priority because we must focus on the state of events that existed in 1990 and 1992. See
Viking Boat, 191 U.S.P.Q. at 303 ("[T]he question of natural expansion must be viewed not in light of present

                                                       8
name with the high-quality raw shrimp sold by Mariscos. CBI sold its seafood gumbo, and later, its shrimp

cakes, crawfish cakes, lobster cakes, and crab cakes, directly to retail outlets where those products would

generally be purchased by end users while still in the packaging marked CARNIVAL.10 It would be unlikely

for any confusion of source or sponsorship to arise at the level of the end user, since the end user would never

see the CARNIVAL mark used in connection with Mariscos' high-quality raw shrimp. Rather, any possible

confusion could arise only at the level of the retailers or wholesalers who purchased Mariscos' shrimp in

boxes bearing the name CARNIVAL, and also were in the market for CBI's products.

        The district court acknowledged that "there may be some overlap between customers of the Plaintiff

and the Defendant," but explained that "such overlap would be limited to a situation in which a grocery store

purchased boxes of the Plaintiff's raw shrimp from Ludwig to sell in the fresh fish department and that same

grocery store purchased the Defendant's prepackaged, prepared foods for resale to consumers in the frozen

food department." District Court Order at 17. The court continued that "[t]his type of overlap is insignificant

to the Court's likelihood of confusion analysis, in the absence of evidence which conflicts with the

Defendant's characterization of its primary customers as consumers and not resellers of any kind." Id.

        Somewhat contrary to the district court opinion, the case law indicates that confusion at pre-end

consumer stages of the distribution process may be actionable. See Yarmuth-Dion, Inc. v. D'ion Furs, Inc.,

835 F.2d 990, 994 (2d Cir.1987) (where designer who made fur coats sold them to department stores who

then marketed them to end customers without the designer's identifying mark, it was error for district court


trade practices but rather what they were in 1961 when [the intervening user] began to do business under the
mark 'VIKING'.").
   10
      The affidavit of CBI's principal said, "I have always sold Louisiana Creole or Cajun specialties that are
prepared, pre-packed, ready-to-eat specialty food products.... I have always packaged my Carnival Brands
New Orleans prepared food products in retail-type packaging. I also offer the identical products in food
service quantity but always under the same name. My products are not meant to be repackaged after sale and
I am not aware of a single person or entity repackaging my products for resale." An inference can be drawn
from this affidavit that some food service establishments might sell CBI's products to the ultimate consumer
without the CARNIVAL label affixed thereto. However, the primary way in which CBI's products appear
to have reached the public is sales to grocery stores followed by sales to end users with the CARNIVAL name
still attached.

                                                       9
to focus exclusively on the retail market (in which department store patrons would not recognize the

designer's mark and therefore there would be no likelihood of confusion) because the wholesale market (i.e.,

the possibility of confusion among the department stores who bought the fur coats for resale) was relevant);

Russ Berrie & Co., Inc. v. Jerry Elsner Co., Inc., 482 F.Supp. 980, 990 (S.D.N.Y.1980) (holding that where

defendant did not affix the mark to its product and therefore the end consumer was never made aware of the

mark, but defendant promoted the mark to wholesalers, "[t]here is no reason in law or equity why [plaintiff]

would not be entitled to forestall confusion at the wholesale level. The test of course is whether one—in this

case a retailer—who had seen [plaintiff's] product under the mark [in question], would later know the

difference when presented with an identical [product] offered to him under the [confusingly similar mark].").

The forecast of evidence indicates at least some degree of overlap between the type of customers, i.e., grocery

chains, restaurants, etc., who bought from Mariscos and CBI. While it may ultimately turn out that no such

overlap existed, and/or that there was no likelihood of confusion, we cannot say based on the current status

of the record that there is no genuine issue of material fact on this point. We are hampered in our attempted

review in this regard because the district court's analysis of the potential confusion at this wholesale level was

limited to the cursory statements quoted above.11

        Fifth, the evidence showed little with respect to advertising by either party in the critical time frame

of 1990,12 so the fifth factor is neutral in impact. Sixth, there is no evidence in the record that would indicate

bad faith on the part of CBI's principal in his decision to use the name CARNIVAL or CARNIVAL CAJUN

CLASSICS when he started doing business as a sole proprietorship in 1990. Rather, the unrebutted evidence

suggests that he adopted the name to evoke the spirit of the Mardi Gras festivities in New Orleans, a city


  11
    On remand, the parties may wish to explore whether the purchasing agents of the commercial institutions
buying Mariscos' shrimp were likely to be sophisticated businesspeople who would not be easily confused
by the dual use of the CARNIVAL mark. Indeed, the case law and commentary indicate that this is
frequently the case with respect to conflicting marks in wholesale markets. See Electronic Data Sys. Corp.
v. EDSA Micro Corp., 23 U.S.P.Q.2d 1460, 1465 (T.T.A.B.1992); 3 McCarthy §§ 23:101, 23:102.
  12
    The declaration of James Rukin, Mariscos' principal, indicates that Mariscos engaged in some advertising
of its high-quality raw shrimp but fails to give specific facts in this regard.

                                                       10
whose culture was closely associated with the cuisine of his product. Seventh, there is no evidence of actual

confusion in the relevant time frame, i.e., 1990.13

        Based on the totality of these factors, we conclude that there are genuine issues of material fact

regarding the likelihood of confusion of source, sponsorship, or affiliation with respect to Mariscos' product

compared to CBI's product, at the time CBI began doing business, and two years thereafter when it began to

sell processed seafood products other than gumbo. Cf. Tally-Ho, 889 F.2d at 1027 (senior use of "You and

the Law" mark in connection with the title of an instructional television series in the educational telecourse

market extended to the broadcast cable television market, because it was reasonable for consumers to be

confused as to the relationship between the two users). The first and second factors—the strength of the mark

and the similarity of the marks—clearly weigh in favor of CBSC. The fifth factor—advertising—is neutral.

The sixth and seventh factors—intent and actual confusion—weigh in favor of CBI. With respect to the third

factor—the similarity of the goods—raw shrimp and seafood gumbo are not so dissimilar that confusion is

unlikely; the likelihood of confusing the instant goods would seem to depend upon the other relevant factors,

including the context in which the potential victim of confusion comes into contact with the goods (which

implicates the fourth factor).14 However, as we have seen, the other relevant factors are closely balanced, and


   13
     It is at this point that the distinction between performing the likelihood-of-confusion test for purposes
of determining priority via the natural expansion theory, on the one hand, and performing the
likelihood-of-confusion test for purposes of determining whether current infringement has occurred, on the
other hand, becomes highly significant. The former test focuses on the time frame when the intervening use
began to occur—in this case, 1990, when CBI began doing business under the CARNIVAL name with respect
to chicken gumbo and seafood gumbo, and 1992, with respect to shrimp cakes, crawfish cakes, lobster cakes,
and crab cakes. See Viking Boat, 191 U.S.P.Q. at 303 ("[T]he question of natural expansion must be viewed
not in light of present trade practices but rather what they were in 1961 when [the intervening user] began
to do business under the mark 'VIKING'."). Thus, the various instances of actual confusion occurring at the
FMI Show in Chicago and at the San Francisco trade show in 1997 are not relevant.
  14
     For example, when a retail customer in a grocery store sees a pile of raw shrimp at the fish counter, with
no brand name at all, there is little likelihood that such end user would confuse the source or sponsorship of
the raw shrimp with that of CBI's packaged seafood gumbo or shrimp cakes (bearing the CARNIVAL mark)
even though located in another part of the same store. On the other hand, depending upon factors not yet
analyzed by the district court, there may be a likelihood of confusion at the level of the retailers or
wholesalers who purchased Mariscos' shrimp in boxes bearing the name CARNIVAL, and who were also in
the market buying CBI's products bearing the same CARNIVAL mark.

                                                      11
there are genuine issues of material fact with respect to the fourth factor, the similarity of trade channels. In

this particular case, we believe that the appropriate resolution of the remaining genuine issues of fact may be

crucial to a proper disposition of this case; and we believe that further analysis by the district court in the first

instance is appropriate.

B.        Hi-Seas Assignment

          Second, plaintiff CBSC may have obtained rights in the CARNIVAL mark through the Hi-Seas

Assignment. Because CBSC stepped into Hi-Seas' shoes, CBSC's priority depends on the priority as between

Hi-Seas and CBI. Hi-Seas began using the CARNIVAL mark in June 1992 for fresh frozen shrimp, cooked

shrimp, breaded shrimp, cooked crawfish, and breaded alligator. At that time, CBI had been operating since

1990 as an unincorporated sole proprietorship, and had been selling chicken gumbo and seafood gumbo.

However, at that time, CBI had not yet expanded into other processed seafood products.15

          Because CBI was using the CARNIVAL mark before Hi-Seas with respect to a different good,

priority as between CBI and Hi-Seas turns on the same "natural expansion" concept that was explored supra

in the context of Mariscos' priority and the Mariscos Assignment. That is, CBI is unquestionably the senior

user with respect to seafood and chicken gumbo. The senior user's, i.e., CBI's, priority "may extend into uses

in 'related' product or service markets," i.e., the market for the products sold by Hi-Seas, because a trademark

owner has protection "against the use of its mark on any product or service which would reasonable be

thought by the buying public to come from the same source, or thought to be affiliated with, connected with,

or sponsored by, the trademark owner." Tally-Ho, 889 F.2d at 1023 (internal quotation marks omitted). If

Hi-Seas' product was one into which CBI could have naturally expanded, then CBI could have enjoined Hi-

Seas at that time, and CBI would have priority. The issue is whether—when Hi-Seas started using the

CARNIVAL mark in June 1992 for fresh frozen shrimp, cooked shrimp, breaded shrimp, cooked crawfish,

and breaded alligator—there was a likelihood of confusion as between Hi-Seas' products and CBI's seafood

     15
   CBI expanded into other processed seafood products, in particular shrimp cakes, crawfish cakes, lobster
cakes, and crab cakes, in December 1992.

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gumbo which had been sold under the CARNIVAL mark since 1990. The existence of such likelihood of

confusion, in turn, is determined by applying the familiar seven-factor test to Hi-Seas and CBI as of June

1992.

        The district court disregarded the Hi-Seas Assignment on the ground that "[a]ny rights received by

Plaintiff via the assignment are legally insignificant ... because [the record] indicates that Hi-Seas' rights to

the mark extended back only to June 10, 1992 .... [and] [h]aving used the 'Carnival' mark since 1990 in

connection with the manufacture and sale of seafood gumbo and chicken gumbo, the Defendant's rights in

the mark are senior to those assigned by Hi-Seas to the Plaintiff." District Court Order at 8 n. 4. This ruling

implicitly assumes that the natural expansion or related goods doctrine operated to extend CBI's priority from

the seafood gumbo market to the market for the products sold by Hi-Seas. However, there is nothing in the

district court's order to suggest that it applied the seven-factor test in analyzing this question, as directed by

Tally-Ho, and we are not inclined to do so for the first time on appeal. Thus, on remand, the district court

should conduct further proceedings, e.g., perform the proper analysis to decide whether there is any genuine

issue of material fact as to whether the priority generated by CBI's senior use extended to give CBI priority

in the use of the CARNIVAL mark in connection with the products sold by Hi-Seas.

                                              IV. CONCLUSION

        Because we have determined that on this record, genuine issues of material fact remain outstanding

regarding whether plaintiff CBSC may have derived priority (via either the Mariscos Assignment or the Hi-

Seas Assignment) in the subject uses of the mark CARNIVAL, we vacate. The order granting summary

judgment is vacated and the cause is remanded for further proceedings in accordance with this opinion.

        VACATED AND REMANDED.




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