## Facts

- A Pennsylvania alcoholic-beverage producer used the same distinctive bottle shape for its cordial line since 1968 and prominently featured the bottle in most promotional materials.
- A Puerto Rico distiller developed a rum-based schnapps for the U.S. market using a bottle derived from an existing bottle design provided as a sample to a manufacturer, with minor modifications.
- The competing bottles shared a similar side profile but differed in height, neck length, and cross-sectional shape.
- The plaintiff introduced state-by-state sales evidence to show where its bottle design functioned as a source identifier; its market share exceeded 3% of cordial sales in only a few states and was minimal elsewhere.
- A jury found the plaintiff’s bottle trade dress had secondary meaning and that the defendant’s bottle created a likelihood of consumer confusion.
- The district court granted injunctive relief but limited it to Pennsylvania and to “cordials and specialties,” and it directed a verdict for defendants on monetary and punitive damages.
- The plaintiff appealed the limited injunction and the denial of punitive damages; defendants cross-appealed aspects of liability and relief.

## Issues

1. Whether the injunction should extend beyond Pennsylvania to other states based on the plaintiff’s proof of market penetration and secondary meaning.
2. Whether the injunction should cover all “spirits,” rather than being limited to “cordials and specialties.”
3. Whether the evidence permitted punitive damages under state law, or whether a directed verdict against punitive damages was proper.

## Decision

- The court affirmed that injunctive relief for trade-dress infringement must be tailored to the geographic areas where the plaintiff proved sufficient market penetration and secondary meaning.
- The court declined to require nationwide relief on the existing record and remanded for application of a structured market-penetration analysis to determine any appropriate expansion beyond Pennsylvania.
- The court affirmed limiting the injunction to “cordials and specialties,” rejecting broader coverage for all spirits absent proof that the trade dress had secondary meaning in those other product markets.
- The court largely affirmed the directed verdict barring punitive damages, concluding the record did not show the level of willful or malicious conduct required under the applicable state standard, and remanded only to the extent further proceedings were necessary consistent with its analysis.

## Legal Principles

- Trade-dress protection under the Lanham Act requires proof that the dress has acquired secondary meaning and that the defendant’s use creates a likelihood of confusion.
- The geographic scope of an injunction should be commensurate with proven market penetration and secondary meaning; a finding of infringement does not automatically justify nationwide injunctive relief.
- The product-market scope of trade-dress relief generally tracks the markets where consumers recognize the dress as a source identifier; expansion to adjacent product categories requires supporting evidence.
- Punitive damages under state law demand a heightened showing beyond infringement, typically requiring proof of willful, malicious, reckless, or otherwise outrageous conduct.

## Conclusion

The court held that equitable relief for trade-dress infringement must be limited to the geographic and product markets supported by evidence of secondary meaning and market penetration, affirmed the product-category limitation and the denial of punitive damages on the record, and remanded for further consideration of the proper geographic reach under a structured market-penetration framework.


Charles Jacquin Et Cie, Inc. v. Destileria Serralles, Inc., 921 F.2d 467 (3d Cir. 1990)