Fun-Damental Too, Ltd. v. Gemmy Industries Corp.
111 F.3d 993 (1997)

  • Fun-Damental was a novelty company that sold a bank shaped like a toilet.  Gemmy was a novelty company that sold a cheaper bank shaped like a toilet.  Fun-Damental sued Gemmy for copyright infringement.
    • Fundamental argued that Gemmy's vice president learned about the product and then directed his Chinese factory to make a knock-off.
  • At trial, Fun-Damental attempted to introduce testimony from their sales manager who testified that retail customers told him that they confused the two products and thought that Fun-Damental was selling the same product at two different prices.
    • Confusion is an essential element of a copyright infringement claim.
  • Gemmy argued that the sales manager's statements were inadmissible as hearsay.
  • The Trial Court allowed the testimony.
  • The Trial Court found for Fun-Damental and issued an injunction for Gemmy to stop marketing their toilet bank.  Gemmy appealed.
  • The Appellate Court affirmed.
    • The Appellate Court found that the testimony was admissible because it was being used to establish that retailers were confused.  It was not being used to establish that Gemmy's product was cheaper.
      • Basically, the specific statements made to the sales manager were not important, it was just their confusion that was important.
    • FRE 803 allows statements that would otherwise be excluded as hearsay to be admissible to show someone's state of mind.