FOR PUBLICATION
United States Court of Appeals for the Ninth Circuit
BROTHER RECORDS, INC., a California Corporation,
Plaintiff-counter-defendant-Appellee,
vs.
ALAN JARDINE, an individual,
Defendant-counter-claimant-Appellant.
No. 01-57095
D.C. No. CV 99-03829 HLH
OPINION
Appeal from the United States District Court
for the Central District of California
Harry L. Hupp, District Judge, Presiding
Argued and Submitted
November 6, 2002-Pasadena, California
Filed January 28, 2003
Before: Harry Pregerson, John T. Noonan, and
A. Wallace Tashima, Circuit Judges.
Opinion by Judge Tashima
1281
COUNSEL
Jeffrey S. Benice, Irvine, California, for the defendant-
counter-claimant-appellant.
Phillip H. Stillman, Del Mar, California, for the plaintiff-
counter-defendant-appellee.
TASHIMA, Circuit Judge:
Alan Jardine appeals the district court's grant of summary
judgment in favor of Brother Records, Inc. ("BRI"), on BRI's
Lanham Act, 15 U.S.C. §§ 1051-1129, trademark infringe-
ment action alleging that Jardine infringed BRI's "The Beach
Boys" trademark. Jardine also appeals the district court's
grant of summary judgment in favor of BRI on Jardine's
counterclaims that BRI breached a lifetime employment
agreement and license agreement. Finally, Jardine appeals the
district court's denial of his motion to amend his counterclaim
to add third-party claims and an additional counterclaim. We
have jurisdiction under 28 U.S.C. § 1291, and we affirm.
BACKGROUND
In 1961, Al Jardine, Mike Love, Brian Wilson, Carl Wil-
son, and Dennis Wilson formed The Beach Boys. The band
shortly thereafter achieved huge commercial success, produc-
ing numerous hit songs and touring to huge audiences
throughout the country. In 1967, the members of the Beach
Boys incorporated BRI to hold and administer the intellectual
property rights for The Beach Boys. Currently, BRI is equally
owned by four shareholders, who are also its directors: Al Jar-
dine, Mike Love, Brian Wilson, and the estate of Carl Wilson.
BRI is the registered owner of "The Beach Boys" trademark.
Over the years, personal difficulties arose between some of
the members, and some members of the band decided to not
tour full time, or at all. In 1991, the members of the Beach
Boys incorporated Brother Tours, Inc., which handled their
touring and distributed their touring income. In 1993, the
directors of BRI agreed to devote a certain percentage of the
touring income to the corporation for use of the trademark and
designated a larger percentage of the income to those mem-
bers who actually toured. By 1998, Carl Wilson had died,
Love and Jardine no longer wanted to tour together, and Brian
Wilson did not want to tour at all. Love began negotiating
with BRI the terms of a license to use "The Beach Boys"
trademark in connection with his own band.
BRI's directors met on July 14, 1998, to discuss how the
trademark should be used. The representative of Carl Wil-
son's estate suggested that BRI issue non-exclusive licenses
to each shareholder on the same terms and conditions as the
license that was being negotiated with Love, thus giving each
member an equal right to tour. Three of the four board mem-
bers, including Jardine, voted to grant each Beach Boy a non-
exclusive license. On October 1, 1998, BRI executed a non-
exclusive license agreement with Love (the "Love license").
The Love license contained clauses designed to protect the
value of the trademark, requiring the licensee to preserve The
Beach Boys style and to choose from a list of approved book-
ing agencies and managers.
The parties dispute whether BRI and Jardine entered into a
non-exclusive license agreement. After the July 1998 BRI
board meeting, Jardine began touring with his own band,
using a booking agent and manager that were not included in
the list approved by the Love license. On October 25, 1998,
Jardine's attorney sent BRI a letter saying that Jardine would
be performing as "Beach Boys Family and Friends," and that
therefore, "a license from BRI [was] unnecessary." On Octo-
ber 28, 1998, BRI told Jardine that his unlicensed use of the
trademark would be an infringement.
Jardine then proposed a license that included terms differ-
ent from those included in the Love license. Jardine's pro-
posal contemplated only a five-percent royalty to BRI on the
first $1 million of gross receipts and a 17.5 percent royalty
thereafter. BRI proposed a 17.5 percent royalty across the
board. Love's license required a royalty of 20 percent of the
first $1 million and 17.5 percent of receipts thereafter. Also,
Jardine wanted to use a booking agent and manager that were
not on the approved list. Jardine stated that, whether or not
BRI accepted the proposal, he would continue performing as
the "Beach Boys Family and Friends."
The BRI board scheduled another meeting for November
24, 1998 to discuss Jardine's proposal. Before the meeting,
Jardine's attorney sent a letter to the board with a proposed
license agreement signed by Jardine. At the meeting, the BRI
board voted to reject Jardine's proposal. In the months follow-
ing the meeting, Jardine both attempted to negotiate an agree-
ment and claimed he had a license.
Jardine and his band continued to perform using names that
included "The Beach Boys" trademark. The performances
were promoted under names such as: Al Jardine of the Beach
Boys and Family & Friends; The Beach Boys "Family and
Friends"; Beach Boys Family & Friends; The Beach Boys,
Family & Friends; Beach Boys and Family; as well as, sim-
ply, The Beach Boys. Jardine and his band performed in loca-
tions and on dates close to Love's "The Beach Boys" shows.
With two bands touring as The Beach Boys or as a similar-
sounding combination, show organizers sometimes were con-
fused about what exactly they were getting when they booked
Jardine's band. A number of show organizers booked Jar-
dine's band thinking they would get The Beach Boys along
with special added guests, but subsequently canceled the
booking when they discovered that Jardine's band was not
what they thought it was. Numerous people who attended one
of Jardine's shows said that they had been confused about
who was performing. During this time period, BRI sent Jar-
dine cease and desist letters objecting to Jardine's use of the
trademark.
On April 9, 1999, BRI filed its complaint in the district
court alleging that Jardine was infringing its trademark. Jar-
dine answered, asserting the defenses of fair use, laches,
estoppel, and unclean hands, and counterclaimed for breach of
employment agreement, breach of license agreement, and for
a declaratory judgment that Jardine could tour as the "Beach
Boys Family and Friends." On March 28, 2000, the district
court issued the preliminary injunction prohibiting Jardine
from using "The Beach Boys," "The Beach Boys Family and
Friends," and other similar combinations, but still allowing
Jardine to refer to his past membership in the band "in a
descriptive fashion."
On March 19, 2001, two weeks before the close of discov-
ery, Jardine moved for leave to amend his pleading to add
third-party claims against the shareholders and directors of
BRI and an additional counterclaim against BRI for breach of
fiduciary duty. The district court denied the motion. On June
4, 2001, BRI moved for summary judgment on its trademark
infringement claim and Jardine's counterclaims. The district
court granted summary judgment in favor of BRI and issued
a permanent injunction against Jardine's use of the trademark.
This timely appeal followed.
STANDARD OF REVIEW
We review the district court's grant of summary judgment
de novo. See Entrepreneur Media, Inc. v. Smith, 279 F.3d
1135, 1139-40 (9th Cir. 2002). Viewing the evidence in the
light most favorable to the non-moving party, we must deter-
mine whether there are any genuine issues of material fact
that remain for trial and whether the district court correctly
applied the relevant substantive law. Id. at 1140. "Because of
the intensely factual nature of trademark disputes, summary
judgment is generally disfavored in the trademark arena." Id.
(quoting Interstellar Starship Servs., Ltd. v. Epix, Inc., 184
F.3d 1107, 1109 (9th Cir. 1999)). "Therefore, a district court
may grant summary judgment and we may uphold a grant of
summary judgment only if no genuine issue exists regarding
likelihood of confusion." Thane Int'l, Inc. v. Trek Bicycle
Corp., 305 F.3d 894, 901 (9th Cir. 2002).
DISCUSSION
I. Trademark Infringement
[1] Jardine contends that his use of BRI's trademark is pro-
tected by either the classic fair use doctrine or the nominative
fair use doctrine. In New Kids on the Block v. News Am.
Publ'g Inc., 971 F.2d 302 (9th Cir. 1992), we noted that the
classic fair use defense could not be applied in that case
because "this is not the classic fair use case where the defen-
dant has used the plaintiff's mark to describe the defendant's
own product." Id. at 308. We then held that, "where the
defendant uses a trademark to describe the plaintiff's product,
rather than its own . . . a commercial user is entitled to a nom-
inative fair use defense." Id. In Cairns v. Franklin Mint Co.,
292 F.3d 1139, 1150-52 (9th Cir. 2002), we reiterated the dis-
tinction between the classic fair use and nominative fair use
doctrines.
The nominative fair use analysis is appropriate
where a defendant has used the plaintiff's mark to
describe the plaintiff's product, even if the defen-
dant's ultimate goal is to describe his own product.
Conversely, the classic fair use analysis is appropri-
ate where a defendant has used the plaintiff's mark
only to describe his own product, and not at all to
describe the plaintiff's product.
Id. at 1152.
To illustrate this distinction, we cited a number of cases
that applied the nominative fair use analysis. See id. For
example, in New Kids, the defendant newspapers used the
New Kids trademark to refer to the music band New Kids
itself in order to describe the defendants' own telephone polls
about the band. New Kids, 971 F.2d at 308. See Cairns, 292
F.3d at 1151-52. In Volkswagenwerk AG v. Church, 411 F.2d
350 (9th Cir. 1969), the defendant car repair shop used the
plaintiff's trademarked name "Volkswagen" in a sign that said
"Modern Volkswagen Porsche Service." Id. at 351. In Smith
v. Chanel, Inc., 402 F.2d 562 (9th Cir. 1968), a seller of imita-
tion perfumes advertised its "2d Chance" perfume as indistin-
guishable from the trademarked "Chanel No. 5" perfume. Id.
In WCVB-TV v. Boston Athletic Ass'n, 926 F.2d 42 (1st Cir.
1991), a television station referred to and made broadcasts of
the trademarked "Boston Marathon." Id. at 44. In all these
cases, the defendant used the plaintiff's trademark to refer to
the plaintiff's product, and therefore the nominative fair use
analysis applied.
Following New Kids, we have applied the nominative fair
use defense in a number of cases. In most of these cases, the
nominative fair use defense, as opposed to the classic fair use
defense, clearly applied because the defendant used the plain-
tiff's mark undeniably to refer to the plaintiff's product, even
though the defendant's ultimate goal was to describe his own
product. In Abdul-Jabbar v. Gen. Motors Corp., 85 F.3d 407
(9th Cir. 1996), the defendant automobile manufacturer
referred to plaintiff, a basketball star who had won an award
three years in a row, in a commercial for a car that also had
won an award three years in a row. Id. at 409. In Downing v.
Abercrombie & Fitch, 265 F.3d 994 (9th Cir. 2001), the
defendant clothing company used the trademarked names and
photograph of plaintiffs, surfing champions, to market shirts
copied from those worn by plaintiffs in the photograph. Id. at
1000, 1009. These were not cases in which the defendant used
the plaintiff's mark only to describe the defendant's own
product, and not at all to describe the plaintiff's product. See
Cairns, 292 F.3d at 1151 (explaining when classic fair use
analysis applies). Rather, these were cases in which the defen-
dant used the plaintiff's mark to describe the plaintiff's prod-
uct - Kareem Abdul-Jabbar himself and the surfing
champions themselves - even though the ultimate goal was
to describe the defendant's own product. See id. (explaining
when nominative fair use analysis applies).
We also have applied the nominative fair use analysis
where the plaintiff's trademark was also the defendant's title.
In Playboy Enterprises, Inc. v. Welles, 279 F.3d 796 (9th Cir.
2002), plaintiff Playboy sued the defendant, who was Playboy
Playmate of the Year in 1981, for her use of that trademarked
title on her own website, which offered information about her
and free photographs of her, advertised photographs for sale
and membership in her photo club, and promoted her services
as a spokesperson. Id. at 799. We explained in Cairns that the
classic fair use analysis did not apply in Playboy because
Welles had not used the Playboy mark "only to describe [her]
own product, and not at all to describe the plaintiff's product."
Cairns, 292 F.3d at 1152 & n.10. Although Welles arguably
also used the mark to describe herself in the first instance -
as she herself was indeed Playboy Playmate of the Year in
1981 - the fact that Welles used Playboy's mark to describe
Playboy's product at all precluded the application of the clas-
sic fair use analysis. See id.
Here, Jardine argues that either the classic fair use or the
nominative fair use defense applies. As in Playboy, whether
the defendant's use of the mark refers to the plaintiff's prod-
uct at all - and thus whether classic fair use analysis or nom-
inative fair use analysis applies - is not clear. Jardine
illustrates this point with his conflicting arguments (1) that his
use of "The Beach Boys" mark describes the Beach Boys'
product, thus requiring application of the nominative fair use
analysis, and (2) that, in the alternative, his use of "The Beach
Boys" mark describes only himself - a founding member of
the Beach Boys - and not at all to describe the Beach Boys'
product, thus requiring application of the classic fair use anal-
ysis. Where the defendant uses his or her own title, which
happens also to be plaintiff's trademark, defendant can argue
convincingly both that the use refers to defendant and that the
use refers not at all to defendant. In these situations, the
reference-to-trademark-holder distinction often proves more
frustrating than helpful.
[2] Rather than contorting ourselves into finding either that
Jardine used "The Beach Boys" mark to describe the Beach
Boys or that Jardine used "The Beach Boys" mark only to
describe himself and not at all to describe the Beach Boys, we
analyze each defense separately. We note first that the classic
fair use defense, codified in the Lanham Act, 15 U.S.C.
§ 1115(b)(4), applies only to marks that possess both a pri-
mary meaning and a secondary meaning - and only when the
mark is used in its primary descriptive sense rather than its
secondary trademark sense.
1
See Cairns, 292 F.3d at 1150-51
("Under the common law classic fair use defense . . . `[a]
junior user is always entitled to use a descriptive term in good
faith in its primary, descriptive sense other than as a trade-
mark.' ") (quoting 2 J. Thomas McCarthy, McCarthy on
Trademark and Unfair Competition § 11:45 (4th ed. 2001));
1
The law conceptually classifies trademarks along a spectrum of
increasing distinctiveness: (1) generic, (2) descriptive, (3) suggestive, and
(4) arbitrary or fanciful. See Two Pesos, Inc. v. Taco Cabana, 505 U.S.
763, 768 (1992); Interstellar Starship Servs., 304 F.3d at 943 n.6; Filipino
Yellow Pages, Inc. v. Asian Journal Publ'ns, Inc., 198 F.3d 1143, 1147
(9th Cir. 1999). A descriptive mark "directly describes something about
the goods or services in connection with which it was used as a mark." J.
Thomas McCarthy, McCarthy's Desk Encyclopedia of Intellectual Prop-
erty, 119 (2d ed. 1995); Brookfield Communications, Inc. v. W. Coast
Entm't Corp., 174 F.3d 1036, 1058 n.19 (9th Cir. 1999). "Although
descriptive terms generally do not enjoy trademark protection, a descrip-
tive term can be protected provided that it has acquired `secondary mean-
ing' in the minds of consumers, i.e., it has become distinctive of the
trademark applicant's goods in commerce." Entrepreneur Media, Inc. v.
Smith, 279 F.3d 1135, 1142 n.3 (9th Cir. 2002) (quoting Park `N Fly v.
Dollar Park & Fly, Inc., 469 U.S. 189, 194 (1985)). See 15 U.S.C.
§ 1052(f) (permitting registration of marks that have become "distinctive
of the applicant's goods in commerce"); 15 U.S.C. § 1053 (applying same
requirement to registration of service marks). Similarly, a suggestive mark
"conveys an impression of a good but requires the exercise of some imagi-
nation and perception to reach a conclusion as to the product's nature,"
and therefore carries both a primary descriptive meaning and a secondary
trademark meaning. Brookfield Communications, 174 F.3d at 1058 n.19
(citing "Roach Motel" insect trap as an example); Entrepreneur Media,
279 F.3d at 1142.
Accord Park `N Fly, 469 U.S. at 201 ("The Lanham Act, . . .
under certain circumstances, permits the nontrademark use of
descriptive terms contained in an incontestable mark."); Car-
Freshner Corp. v. S.C. Johnson & Son, Inc., 70 F.3d 267, 269
& n.1 (2d Cir. 1995); Zatarain's, Inc. v. Oak Grove Smoke-
house, Inc., 698 F.2d 786, 791 (5th Cir. 1983); Ideal Indus.,
Inc. v. Gardner Bender, Inc., 612 F.2d 1018, 1026 (7th Cir.
1980). Section 1115(b)(4) allows the defense to trademark
infringement that the use of the name, term or device charged to be an
infringement is a use, otherwise than as a mark . . .
of a term or device which is descriptive of and used
fairly and in good faith only to describe the goods or
services of such party, or their geographic origin.
15 U.S.C. § 1115(b)(4).
We have explained that "the primary cost of recognizing
property rights in trademarks is the removal of words . . .
from our language." New Kids, 971 F.3d at 306. We therefore
recognized that the classic fair use defense "in essence, for-
bids a trademark registrant to appropriate a descriptive term
for his exclusive use and so prevent others from accurately
describing a characteristic of their goods." Id. (citation and
internal quotation marks omitted). "If the trademark holder
were allowed exclusive rights in such use, the language would
be depleted in much the same way as if generic words were
protectable." Id. See Restatement (Third) of Unfair Competi-
tion § 28 cmt. a ("Trademark rights . . . extend only to the
source significance that has been acquired by such terms, not
to their original descriptive meanings.").
We consistently have applied the classic fair use analysis to
infringement cases involving descriptive marks used in their
primary, descriptive sense. In Cairns, we cited In re Dual-
Deck Video Cassette Recorder Antitrust Litig., 11 F.3d 1460
(9th Cir. 1993), as a good example of classic fair use. Cairns,
292 F.3d at 1151 n.9. In that case, the defendant sold receiv-
ers to which two videocassette recorders could be attached
and labeled the relevant terminals on the backs of its
machines "VCR-1" and "VCR-2." Dual-Deck, 11 F.3d at
1462. We concluded that defendant's use of plaintiff's trade-
mark "VCR-2," a descriptive mark that identified plaintiff's
two-deck videocassette recorder, was descriptive of defen-
dant's own product. Id. at 1467. Because defendant used
plaintiff's mark in its primary, descriptive sense and in good
faith, defendant's use was not an infringement. Id.
Likewise, in Entrepreneur Media, Inc. v. Smith, 279 F.3d
1135 (9th Cir. 2002), we recognized that trademark protection
extends only to the secondary, trademark meaning of a
descriptive mark, and not to the primary descriptive meaning
of the terms. See id. at 1143-44. In that case, we concluded
that plaintiff's trademark "Entrepreneur" was a descriptive
mark that directly identified plaintiff's printed publications.
Id. We emphasized that, although the plaintiff trademark
holder had "the exclusive right to use its trademark in printed
publications pertaining to business opportunities," the plain-
tiff "cannot have the exclusive right to use the word `entrepre-
neur' in any mark identifying a printed publication addressing
subjects related to entrepreneurship." Id. at 1143 (emphasis in
the original).
2
We similarly have allowed classic fair use of a suggestive
mark, which carries both an unprotectable primary meaning
2
The Second Circuit illustrated the permissible use of trademarked
terms in their primary, descriptive sense with the following example:
An auto manufacturer's use of the mark SWEET for its cars
could not deprive anyone of the right to use that word in good
faith in its ordinary descriptive sense and not as a trademark.
Thus a candy manufacturer would remain free to advertise the
sweetness of its candies without worry about the trademark
owner's bridging the gap and going into the candy business.
Car-Freshner Corp., 70 F.3d at 269.
and a protected secondary meaning. See Brookfield Communi-
cations, 174 F.3d at 1066; accord Car-Freshner Corp., 70
F.3d at 269 & n.1 (explaining that the § 1115(b)(4) classic fair
use defense can apply to a mark regardless of its classification
as descriptive, suggestive, arbitrary, or fanciful, so long as the
mark carried a descriptive primary meaning and a trade-
marked secondary meaning). In Brookfield Communications,
we concluded that defendant legitimately could use the term
"Movie Buff" in its metatags to denote the term's primary
descriptive meaning of "motion picture enthusiast." We
emphasized, however, that defendant could not use the plain-
tiff's suggestive trademark "MovieBuff," which, in its sec-
ondary trademark sense, designated the software goods and
database services of plaintiff. Id. at 1066 (noting that the dif-
ference of a single space is "pivotal").
[3] Here, as in Playboy and New Kids, Jardine does not use
the trademark in any primary, descriptive sense. That is, Jar-
dine does not use "The Beach Boys" trademark to denote its
primary, descriptive meaning of "boys who frequent a stretch
of sand beside the sea."
3
Instead, Jardine uses "The Beach
Boys" trademark in its secondary, trademark sense, which
denotes the music band - and its members - that popular-
ized California surfing culture. This is true regardless of
whether Jardine's use of the mark refers to Jardine himself or
3
Similarly, the defendant newspapers in New Kids did not use the trade-
mark "New Kids on the Block" to denote its primary, descriptive meaning
of "children who recently moved to this area bounded by streets on four
sides." See New Kids, 971 F.2d at 308 (stating that defendant newspapers
referred to the New Kids to identify them as the subject of telephone
polls). Neither did the defendant in Playboy use the trademark "Playboy
Playmate of the Year" to denote its primary, descriptive meaning, if
indeed one exists, of "a companion in games and recreation to a man of
means who is given to pleasure-seeking." See Webster's New World Col-
lege Dictionary 1036 (3d ed. 1994); Playboy, 279 F.3d at 802 (explaining
that defendant used the mark to identify herself as having been named
Playboy Playmate of the Year in 1981). Had the defendants in those cases
done so, then the classic fair use analysis would have applied
to the band. Because Jardine does not use the mark in its pri-
mary, descriptive sense, the classic fair use defense does not
apply.
4
[4] Where the defendant uses the trademark not in its pri-
mary, descriptive sense, but rather in its secondary, trademark
sense, the nominative fair use analysis applies. See New Kids,
971 F.2d at 308. The nominative fair use defense acknowl-
edges that "it is often virtually impossible to refer to a particu-
lar product for purposes of comparison, criticism, point of
reference or any other such purpose without using the mark."
Id. at 306. Still, the "core element" of trademark infringement
law is "whether an alleged trademark infringer's use of a
mark creates a likelihood that the consuming public will be
confused as to who makes what product." Thane Int'l, 305
F.3d at 901 (internal quotation marks omitted). Therefore, the
nominative fair use defense is available only if "the use of the
trademark does not attempt to capitalize on consumer confu-
4
We note that the district court found, as an undisputed fact, that Jar-
dine's use of the trademark "caused numerous instances of confusion both
with the consuming general public and with the producers of musical
events." On appeal, Jardine does not challenge the district court's conclu-
sion that his use of the trademark caused confusion. The purpose of trade-
mark infringement law is to "ensur[e] that owners of trademarks can
benefit from the goodwill associated with their marks and that consumers
can distinguish among competing producers." Thane Int'l, Inc. v. Trek
Bicycle Corp., 305 F.3d 894, 901 (9th Cir. 2002). Consistent with that pur-
pose, we have held that the classic fair use defense is not available if there
is a likelihood of customer confusion as to the origin of the product."
Cairns, 292 F.3d at 1151 (citing Transgo, Inc. v. Ajac Transmission Parts,
Corp., 911 F.2d 363, 365 n.2 (9th Cir. 1990), and Lindy Pen Co. v. Bic
Pen Corp., 725 F.2d 1240, 1248 (9th Cir. 1984)). Therefore, even if the
classic fair use analysis applied in this case, the classic fair use defense
would not be available because the likelihood of confusion - indeed, the
existence of actual confusion - is undisputed. See Thane Int'l, 305 F.3d
at 902 ("Evidence of actual confusion constitutes persuasive proof that
future confusion is likely . . . . If enough people have been actually con-
fused, then a likelihood that people are confused is established.") (citations
and internal quotation marks omitted).
sion or to appropriate the cachet of one product for a different
one." New Kids, 971 F.2d at 307-308.
[5] In New Kids, we articulated the three requirements of
the nominative fair use defense: First, the product or service in
question must be one not readily identifiable without use of the
trademark; second, only so much of the mark or marks may be
used as is reasonably necessary to identify the prod-
uct or service; and third, the user must do nothing
that would, in conjunction with the mark, suggest
sponsorship or endorsement by the trademark holder.
Id. at 308. Just as it is virtually impossible to refer to the New
Kids on the Block, the Chicago Bulls, Volkswagens, or the
Boston Marathon without using the trademarked names, so
too is it virtually impossible to refer to the Beach Boys with-
out using the trademark, and Jardine therefore meets the first
requirement. See id. & n.7. Also, BRI does not allege that Jar-
dine uses any distinctive logo "or anything else that isn't
needed" to identify the Beach Boys, and Jardine therefore sat-
isfies the second requirement. See id. at 308.
[6] Jardine fails, however, to meet the third requirement.
Jardine's promotional materials display "The Beach Boys"
more prominently and boldly than "Family and Friends," sug-
gesting sponsorship by the Beach Boys. Cf. Kassbaum v.
Steppenwolf Prods., Inc., 236 F.3d 487, 493 (9th Cir. 2000)
(reasoning that promotional materials reduced likelihood of
confusion by minimizing references to trademarked name
"Steppenwolf"). Also, there is evidence that Jardine uses "The
Beach Boys" trademark to suggest that his band is in fact
sponsored by the Beach Boys, as Jardine's management testi-
fied that they recommended including the trademark "The
Beach Boys" in the name of Jardine's band in order to create
or enhance marquee value. Finally, Jardine's use of the trade-
mark caused actual consumer confusion, as both event orga-
nizers that booked Jardine's band and people who attended
Jardine's shows submitted declarations expressing confusion
about who was performing.
[7] Because Jardine's use of the trademark suggested spon-
sorship or endorsement by the trademark holder, Jardine's
nominative fair use argument fails.
5
"[T]he plain language of Rule 56(c) mandates the entry of summary judgment . . .
against a party who fails to make a showing sufficient to
establish the existence of an element essential to that party's
case, and on which that party will bear the burden of proof at
trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). The
district court did not err in concluding that Jardine's use of the
Beach Boys' trademark was an infringement. No genuine
issue of material fact exists regarding Jardine's suggestion of
sponsorship or endorsement by BRI. We therefore affirm the
district court's grant of summary judgment in favor of BRI on
BRI's trademark infringement claim. See Thane Int'l, 305
F.3d at 901 ("[W]e may uphold a grant of summary judgment
if no genuine issue exists regarding likelihood of confusion.").
II. Laches
The district court rejected laches as an affirmative defense.
We have applied laches to bar trademark infringement claims
5
In reaching this conclusion, we note that the third requirement of the
nominative fair use defense - the lack of anything that suggests sponsor-
ship or endorsement - is merely the other side of the likelihood-of-
confusion coin. See 2 J. Thomas McCarthy, Trademarks and Unfair Com-
petition § 11:47 (4th ed. 2001) (noting "some confusion in the case law as
to whether `fair use' is really a distinct and separate `defense' and arguing
that " `fair use' should be viewed as merely one type of use which is not
likely to cause confusion"). We have held that the nominative fair use
analysis replaces the likelihood-of-confusion analysis set forth in AMF
Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-49 (9th Cir. 1979). Cairns, 292
F.3d at 1150. Therefore, whereas plaintiff carries the burden of persuasion
in a trademark infringement claim to show likelihood of confusion, see
Thane Int'l, 305 F.3d at 900, the nominative fair use defense shifts to the
defendant the burden of proving no likelihood of confusion.
"only where the trademark holder knowingly allowed the
infringing mark to be used without objection for a lengthy
period of time." Goto.com, Inc. v. Walt Disney Co., 202 F.3d
1199, 1209 (9th Cir. 2000) (concluding that objection after
two weeks and filing suit after a few months precluded laches
defense). Two days after Jardine notified BRI of his intent to
tour as "Beach Boys Family and Friends," BRI sent Jardine
a letter saying that "[t]he unauthorized use by [Jardine] of the
name `Beach Boys Family and Friends' is a flagrant and seri-
ous trademark infringement, and any use of the name would
require a license." BRI then filed its complaint in district
court five months after receiving Jardine's notification. The
district court therefore did not err in rejecting Jardine's laches
defense. See Jarrow Formulas, Inc. v. Nutrition Now, Inc.,
304 F.3d 829, 833-34 (9th Cir. 2002) (reviewing laches issue
for clear error and abuse of discretion).
III. Estoppel
We review a district court's decision to deny equitable
estoppel for an abuse of discretion. Levi Strauss & Co. v.
Shilon, 121 F.3d 1309, 1313 (9th Cir. 1997). Jardine cannot
show that he used "The Beach Boys" trademark without
knowing that BRI objected to his use. Therefore, we conclude
that the district court's rejection of Jardine's equitable estop-
pel defense was not an abuse of discretion. See Kierulff v.
Metro. Stevedore Co., 315 F.2d 839, 842 (9th Cir. 1963)
(requiring that party claiming estoppel "acted in ignorance of
the matter asserted").
IV. Unclean Hands
Jardine contends that the district court erred in concluding
that BRI did not act with unclean hands. To prevail on an
unclean hands defense, "the defendant must demonstrate that
the plaintiff's conduct is inequitable and that the conduct
relates to the subject matter of its claims." Levi Strauss & Co.,
121 F.3d at 1313 (quoting Fuddruckers, Inc. v. Doc's B.R.
Others, Inc., 826 F.2d 837, 847 (9th Cir. 1987)). Jardine fails
to point to any evidence, on which a jury reasonably could
rely, that BRI acted in any fraudulent or deceitful manner.
BRI attempted to negotiate a license with Jardine, but refused
to accept Jardine's proposed license agreement because its
royalty terms provided less to BRI than those contained in the
Love license. The district court therefore did not abuse its dis-
cretion in rejecting Jardine's unclean hands defense. See id.
(reviewing decision to deny unclean hands defense for abuse
of discretion).
V. Breach of Employment Contract
Jardine contends that the district court erred in concluding
that no employment relationship existed between Jardine and
BRI. Jardine, however, points to no evidence than an employ-
ment contract in fact existed between him and BRI when BRI
purportedly breached the contract in 1998 and 1999. Under
California law, however, we must examine the totality of the
circumstances "to determine whether the parties' conduct,
considered in the context of surrounding circumstances, gave
rise to an implied-in-fact contract limiting the employer's ter-
mination rights." Guz v. Bechtel Nat'l, Inc., 8 P.3d 1089, 1101
(Cal. 2000). Brother Tours, Inc., is the entity through which
Jardine, Love, and the other original members of the Beach
Boys have conducted their touring and received distributions.
If Jardine performed under any employment agreement, the
agreement was with Brother Tours, Inc., which is not a party
to this action, and not with BRI. This undisputed fact negates
the existence of an implied contract between BRI and Jardine.
We therefore affirm the district court's grant of summary
judgment in favor of BRI on Jardine's counterclaim for
breach of employment contract.
VI. Breach of License Agreement
The district court concluded that Jardine raised a triable
issue of fact as to whether Jardine had a non-exclusive
license, which expired by its own terms on December 31,
1999, to use the Beach Boys trademark. The district court
then reasoned, however, that even assuming a license existed,
because Jardine toured using the Beach Boys trademark in
spite of BRI's objections, Jardine could not show any dam-
ages from any purported breach. Jardine contends that,
because he toured as "Beach Boys Family and Friends" and
not as "The Beach Boys," he earned less income than he
would have, had BRI performed under the license agreement
and allowed him to tour as "The Beach Boys." Jardine further
contends that his damages can be calculated by looking at the
amount of touring income Love earned while touring with his
own band as "The Beach Boys."
Whether Jardine's "The Beach Boys," touring simulta-
neously and in competition with Love's "The Beach Boys,"
would earn as much as a lone "Beach Boys" group is specula-
tive. See Kids' Universe v. In2Labs, 116 Cal. Rptr. 23 158,
171-72 (Ct. App. 2002) (reasoning that profits from un-
launched website were speculative because the website would
be competing with similar retailers on the same portal). Jar-
dine has not set forth specific facts showing damages with
reasonable certainty. See id. at 167-68 (requiring that damages
for the loss of prospective profits from an unestablished busi-
ness be shown by evidence of reasonable certainty). We there-
fore affirm the district court's grant of summary judgment in
favor of BRI on Jardine's counterclaim for breach of license
agreement.
VII. Denial of Jardine's Motion to Amend Pleading
The district court denied Jardine's motion for leave to file
an amended pleading adding a counterclaim against BRI and
third-party claims against BRI's directors for breach of fidu-
ciary duty. We review a district court's denial of a motion to
amend a pleading for abuse of discretion. Sivkovic v. S. Cal.
Edison Co., 302 F.3d 1080, 1087 (9th Cir. 2002). Because
granting Jardine's motion would have caused an undue delay
in the proceedings, the district court did not abuse its discre-
tion. See id. ("The district court may deny a motion for leave
to amend if permitting an amendment would, among other
things, cause an undue delay in the litigation or prejudice the
opposing party."); Solomon v. N. Am. Life & Cas. Ins. Co.,
151 F.3d 1132, 1139 (9th Cir. 1998) (affirming the district
court's denial of motion to amend pleadings filed on the eve
of discovery deadline).
CONCLUSION
Because no genuine issue of material fact exists regarding
the likelihood of confusion, we affirm the district court's
grant of summary judgment in favor of BRI on the trademark
infringement claim. We also affirm the district court's grant
of summary judgment in favor of BRI on Jardine's counter-
claims for breach of contract.
AFFIRMED.
