## Facts

- E. & J. Gallo Winery owned multiple federal trademark registrations for “GALLO” for wine and had used the name continuously since 1933, selling billions of bottles and spending substantial sums on nationwide advertising.
- Consorzio del Gallo Nero, an Italian trade association promoting Chianti Classico, historically associated its member wines with a black rooster symbol and used the designation “Gallo Nero” in U.S. promotion and identification.
- In U.S. commerce, Chianti Classico imports were often identified by the words “Gallo Nero” without a rooster image, functioning as a word designation rather than only a device symbol.
- The Consorzio sought to expand in the United States, including pursuing federal registration of “GALLO NERO” and using “Gallo Nero” on labels and promotional materials for member wines.
- Gallo objected and sued, alleging Lanham Act infringement and false designation of origin, California dilution, and related state-law claims.
- The Consorzio counterclaimed for declaratory relief that its use did not infringe.
- The parties filed cross-motions for summary judgment.

## Issues

1. Whether use of the words “Gallo Nero” in connection with wine and related promotion in U.S. commerce was likely to cause consumer confusion with Gallo’s registered “GALLO” mark under the Lanham Act.
2. Whether use of “Gallo Nero” on wine diluted the distinctive quality of the famous “GALLO” mark under California’s anti-dilution statute.
3. Whether the Consorzio’s survey and historical/traditional-use evidence created a genuine dispute of material fact barring summary judgment.

## Decision

- The court granted summary judgment for Gallo on all claims and denied the Consorzio’s motion for summary judgment on its declaratory-relief counterclaim.
- The court found “GALLO” to be a famous, strong mark entitled to broad protection for wine.
- The court held that the Consorzio’s use of “Gallo Nero” on wine created a likelihood of confusion as a matter of law, including confusion as to affiliation, sponsorship, or connection.
- The court held that the use also constituted dilution under California law by blurring the distinctiveness of the “GALLO” mark.
- The court permanently enjoined the Consorzio from using the word “Gallo” in connection with the promotion and sale of its wines in the United States, including use as part of “Gallo Nero.”
- The court denied Gallo’s request for expenses.

## Legal Principles

- Likelihood of confusion may be found where the junior mark incorporates the entirety of a famous senior mark as a dominant element and is used on identical goods sold through overlapping channels to ordinary consumers.
- Adding a foreign or descriptive term to a famous mark (here, “Nero” appended to “Gallo”) may be insufficient to avoid confusion when the shared element is prominent and the goods are the same.
- Survey evidence may be discounted when it is conducted under artificial side-by-side conditions, fails to measure affiliation/sponsorship confusion, or does not reflect marketplace encounters based on general impressions and imperfect recollection.
- Traditional, historical, or regional significance of a designation does not immunize use in U.S. commerce when the chosen word presentation conflicts with a preexisting famous mark on identical goods.
- Under California dilution law, a famous mark is protected against uses that lessen its distinctiveness, even without proof of actual confusion, competition, or economic injury.

## Conclusion

The court held that using “Gallo Nero” to market wine in the United States infringed and diluted Gallo’s famous “GALLO” mark, rejected the Consorzio’s survey and tradition-based defenses as insufficient to raise a triable issue, and entered an injunction barring U.S. use of “Gallo” in connection with the Consorzio’s wine promotion and sales.


E. & J. Gallo Winery v. Consorzio del Gallo Nero, 782 F. Supp. 457 (N.D. Cal. 1991)