OPINION AND ORDER

KOELTL, Judge

The plaintiff, Caché, Inc. ("Caché") has asserted several causes of action against the defendants, M.Z. Berger Co. ("Berger"), Nelsonic Industries ("Nelsonic"), Mervyn's, Macy's East ("Macy's"), Macy's.com, and Service Merchandise Co., Inc. ("Service Merchandise"), each of which relates directly or indirectly to the defendants' alleged use of the plaintiff's trademark name, "CACHE." The plaintiff seeks damages and injunctive relief. The defendants have moved for summary judgment seeking dismissal of the plaintiff's claims for injunctive relief, damages, an accounting of the defendants' profits, attorneys' fees, and also seek to strike the plaintiff's jury demand.

I. A.

In determining whether summary judgment is appropriate, a court must resolve all ambiguities and draw all reasonable inferences against the moving party. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (citing United States v. Diebold, Inc., 369 U.S. 654, 655 (1962)); see also Gallo, 22 F.3d at 1223. If the moving party meets its burden, the burden shifts to the nonmoving party to come forward with "specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). With respect to the issues on which summary judgment is sought, if there is any evidence in the record from any source from which a reasonable inference could be drawn in favor of the nonmoving party, summary judgment is improper. See Chambers v. TRM Copy Ctrs. Corp., 43 F.3d 29, 37 (2d Cir. 1994)

B.

There is no dispute with respect to the following facts except where specifically noted. The plaintiff, Caché, is a Florida corporation with its principal place of business in New York, New York. (Compl. ¶ 5.) Caché, a publicly traded company with over 200 retail stores nationwide, has engaged in commerce under the name Caché since 1975. (Compl. ¶¶ 12, 13; Pl.'s Ex. 20, ¶ 2.) Caché's stores specialize in women's apparel and are located primarily in shopping malls throughout the United States. (Pl.'s Ex. 20 ¶ 2.) Caché owns Federal Trademark Registration No. 1,194,124 for the mark "CACHE" for retail clothing store services, in International Class 42. (Defts.' 56.1 St. Concerning Injunctive Relief, dated Jun. 16, 2000 ("Defts.' Second 56.1 St.") ¶ 15; Pl.'s Second 56.1 Counter-St. Concerning Injunctive Relief, dated Jul. 17, 2000 ("Pl.'s Second 56.1 St."), ¶ 15.) The plaintiff also owns Federal Trademark Registration No. 1,382,406 for the mark "CACHE" for use in connection with ladies' clothing, namely, shirts, tops, pants, jackets, suits, dresses, belts, shoes, scarves, skirts, skirts with coordinating tops, T-shirts and coats, in International Class 25, and Federal Trademark Registration No. 1,351,848, for the mark "CACHE" for use in connection with ladies' clothing, namely, shirts, tops, pants, jackets, suits, dresses, belts, shoes, scarves, skirts, skirts with coordinating tops, T-shirts and coats, in International Class 25, and for retail clothing store services, in International Class 482. (Defts.' Second 56.1 St. ¶¶ 16, 17; Pl.'s Second 56.1 Counter-St. ¶¶ 15-17.)

Although the exact date is in dispute, sometime in 1996 Berger adopted the "CACHE" mark for use on watches. (Defts.' Second 56.1 st. ¶ 1; Pl.'s Second 56.1 Counter-St. ¶ 1.) Patt Botts, Vice President of Sales for Berger, together with Ellyn Robles, the watch buyer at Sears, Roebuck Co. ("Sears"), and her assistant buyer, selected the "CACHE" mark to replace the FABERGE line of watches which Berger had been selling to Sears, but which Berger could no longer sell because its license to use that mark was expiring. (Defts.' Second 56.1 St. ¶ 2; Pl.'s Second 56.1 Counter-St. ¶ 2.) They selected the "CACHE" mark after Berger had held several meetings over the course of a couple of months, wherein as many as forty different names were considered to replace the FABERGE mark. (Defts.' Second 56.1 St. ¶ 8; Pl.'s Second 56.1 Counter-St. ¶ 8.) Berger alleges that it conducted a trademark search before commencing use of the "CACHE" name, although there is no documentation reflecting such a search. (Defts.' Ex. I at 105-07; Ex. J at 56-57; Pl.'s Second 56.1 Counter-St. ¶ 3.) At the time, there were no registered trademarks for "CACHE" specifically for watches. (Defts.' Second 56.1 St. ¶ 4; Pl.'s Second 56.1 Counter-St. ¶ 4.) Berger chose to use the "CACHE" mark in script because it wanted it to look feminine to fit the customer and because the FABERGE mark it was replacing was also used in script. (Defts.' Second 56.1 St. ¶ 7; Pl.'s Second 56.1 Counter-St. ¶ 7.)

Between 1996 and 1999, Berger sold more than $11 million of watches bearing the "CACHE" mark. (Defts.' Second 56.1 St. ¶ 11; Pl.'s Second 56.1 Counter-St. ¶ 11.) The defendants Macy's, Macys.com, Mervyn's, and Service Merchandise are retail sellers who the plaintiff alleges have sold Berger's watches. (Compl. ¶¶ 25, 29, 31, 33.)

The plaintiff does not sell watches that bear the "CACHE" mark on the watch. (Pl.'s Ex. 20, ¶ 32). Watches sold in its stores typically bear the tradename of the watch manufacture, although the watches do bear the name "CACHE" on tags affixed to the goods. (Pl.'s Ex. 20 ¶ 32; Defts.' Second 56.1 St. ¶ 27; Pl.'s Second 56.1 Counter-St. ¶ 27; Pl.'s Ex. 21 ¶ 2; Pl.'s Ex. 24 ¶ 13.) These tags include the price of the item and the inventory control number and are placed on all items sold in the plaintiff's stores. (Defts.' Second 56.1 St. ¶¶ 28-29; Pl.'s Second 56.1 Counter-St. ¶ 28-29.)

The plaintiff contends that the defendants' use of the "CACHE" mark on watches constitutes trademark infringement in violation of Section 32(1)(a) of the Lanham Act, 15 U.S.C. § 1114(1)(a) (First Cause of Action); trade dress infringement in violation of Section 32(1)(b) of the Lanham Act, 15 U.S.C. § 1114(1)(a) (Second Cause of Action); false designation of origin and unfair competition in violation of Section 43(a)(1)(A) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(A) (Third Cause of Action); false advertising in violation of Section 43(a)(1)(B) of the Lanham Act, 15 U.S.C. S 1125(a)(1)(B) (Fourth Cause of Action); dilution of the distinctive quality of the plaintiff's mark in violation of Section 43(c)of the Lanham Act, 15 U.S.C. § 1125(c) (Fifth Cause of Action); deceptive practices and false and misleading advertising in violation of N.Y. Gen. Bus. Law §§ 349, 350 (Sixth Cause of Action); injury to business reputation and dilution of the distinctive quality of the plaintiff's mark in violation of N.Y. Gen. Bus. Law § 361 (Seventh Cause of Action); and unfair competition in violation of New York common law (Eighth Cause of Action).

III.

The defendants' seek summary judgment on the plaintiff's claims for injunctive relief for trademark infringement and false designation of origin made pursuant to Section 32(1) and Section 43(a) of the Lanham Act, 15 U.S.C. § 1114 (1) and 1125(a).

Section 32(1) of the Lanham Act provides protection against the use in commerce of a "reproduction, counterfeit, copy, or colorable imitation of a registered mark" and its application to "labels, signs, prints, packages, wrappers, receptacles or advertisements" where "such use is likely to cause confusion, or to cause mistake, or to deceive." 15 U.S.C. § 1114(1). Section 43(a) protects both registered and unregistered marks against the use of any word, term, name, symbol or device that "is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person. . . ." 15 U.S.C. § 1125(a). Thus, "[i]n order to succeed a plaintiff does not have to show necessarily that consumers would believe that the defendant's goods or services are from the same source as those of the plaintiff." Sports Auth., Inc. v. Prime Hospitality Corp., 89 F.3d 955, 960 (2d Cir. 1996)

To establish a trademark infringement claim under either of these provisions, a plaintiff must show that it has a valid mark that is entitled to protection and that the defendant's actions are likely to cause confusion with the plaintiff's mark. See The Morningside Group Ltd. v. Morningside Capital Group, L.L.C., 182 F.3d 133, 137 (2d. Cir. 1999); Time, Inc. v. Petersen Publishing Co., L.L.C., 173 F.3d 113, 117 (2d Cir. 1999); Sports Auth., 89 F.3d at 960; Trustees of Columbia Univ. v. Columbia/HCA Healthcare Corp., 964 F. Supp. 733, 741 (S.D.N.Y. 1997)

A.

The defendants first argue that summary judgment is appropriate because the plaintiff does not have a valid mark entitled to protection with respect to watches.

According to Section 7(b) of the Lanham Act, a certificate of registration of a trade or service mark issued by the United States Patent and Trademark Office is "prima facie evidence of the validity of the registered mark and of the registration of the mark, of the registrant's ownership of the mark, and of the registrant's exclusive right to use the registered mark in commerce on or in connection with the goods or services specified in the certificate. . . ." 15 U.S.C. § 1057(b). Although the plaintiff has obtained federal registration protection for the mark "CACHE" for retail clothing store services and for a variety of ladies' clothing, "the presumption of an exclusive right to use a registered mark extends only to the goods and services noted in a registration certificate." Arrow Fastener Co., Inc. v. Stanley Works, 59 F.3d 384, 397 (2d Cir. 1995); see also McGregor-Doniger Inc. v. Drizzle, Inc., 599 F.2d 1126, 1137 (2d Cir. 1979). The plaintiff does not own any federal trademark registrations for "CACHE" for watches. Thus, the plaintiff is not entitled to a presumption of an exclusive right to use the "CACHE" mark for watches.

Where a mark is not registered, the plaintiff has the burden of proving that its mark is a valid trademark. See Reese Publishing Co., Inc. v. Hampton Int'l Communications, Inc., 620 F.2d 7, 11 (2d Cir. 1980);Columbia/HCA, 954 F. Supp. at 742. The strength of a trademark in the marketplace and the degree of protection to which it is entitled are analyzed under four categories of marks that indicate increasing distinctiveness and protectability: (1) generic; (2) descriptive; (3) suggestive; and (4) arbitrary or fanciful. See Estee Lauder Inc. v. Gap, Inc., 108 F.3d 1503, 1508-09 (2d Cir. 1997); Sports Auth., 89 F.3d at 961. Arbitrary or fanciful are sometimes described as separate categories. See Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768 (1992). "A generic term is a common name . . . that describes a kind of product." Gruner + Jahr USA Publishing v. Meredith Corp., 991 F.2d 1072, 1075 (2d Cir. 1993). Generic marks are not protectable. See id. A descriptive mark is "one that tells something about a product, its qualities, ingredients or characteristics." Id. at 1076. Descriptive terms are protectable only with evidence of secondary meaning. See id. A suggestive mark suggests the product, though it may take imagination to grasp the nature of the product. See id. An arbitrary mark has an actual dictionary meeting, but that meeting does not describe the product and a fanciful mark is a made-up name. See id at 1075-76; Jordache Enterprises, Inc. v. Levi Strauss Co., 841 F. Supp. 506, 515 (S.D.N Y 1993) ("Arbitrary marks consist of words that neither suggest nor describe any characteristic of the particular good or service with which it is used."). Suggestive, arbitrary, and fanciful marks are eligible for protection without proof of secondary meaning. See Gruner, 991 F.2d at 1075-76; Thompson Medical Co., Inc. v. Pfizer Inc., 753 F.2d 208, 212-13 (2d Cir. 1985). Classification of a mark is a question of fact. See Bristol-Myers Squibb Co. v. McNeil-P.P.C. Inc., 973 F.2d 1033, 1039 (2d Cir. 1992).

The plaintiff has sufficiently shown that it has a protectible trademark for purposes of this litigation. The defendants do not dispute that the mark "CACHE" is arbitrary as applied to retail clothing store services, ladies' clothing, accessories and watches. (Defs.' Br. at 14.)Webster's II New Riverside University Dictionary defines "cache" primarily as "a hiding place for storing provisions and other necessities." Webster's II New Riverside University Dictionary 216 (1994) This definition bears no relationship to retail clothing store services, ladies' clothing or accessories. The mark "CACHE" is arbitrary and is therefore eligible for protection without proof of secondary meaning.

B.

In Polaroid Corp. v. Polarad Elecs. Corp., 287 F.2d 492 (2d Cir. 1961), the Court of Appeals for the Second Circuit set forth eight non-exclusive factors that courts are to consider when determining whether a likelihood of confusion exists. Those factors are: 1) the strength of the plaintiff's mark; 2) the similarity of the plaintiff's and the defendants' marks; 3) the competitive proximity of the products; 4) the likelihood that the plaintiff will "bridge the gap" and offer a product like the defendants'; 5) actual confusion between products; 6) good faith on the defendants' part; 7) the quality of the defendants' product; and 8) the sophistication of buyers. See Polaroid Corp., 287 F.2d at 495; see also Estee Lauder, 108 F.3d at 1510; Sports Auth., 89 F.3d at 960-65; Hormel Foods, 73 F.3d at 502-05. The decision as to whether a mark infringes requires a "comprehensive analysis of all the relevant facts and circumstances." Vitarroz Corp. v. Borden, Inc., 644 F.2d 960, 968 (2d Cir. 1981). The Court of Appeals for the Second Circuit has instructed that:

[T]he Polaroid factors are not, of course, "exclusive" and should not be applied "mechanically." No single factor is dispositive, and cases may certainly arise where a factor is irrelevant to the facts at hand. But it is incumbent upon the district judge to engage in a deliberate review of each factor, and, if a factor is inapplicable to a case, to explain why. The steady application of Polaroid is critical to the proper development of trademark law, for it is only when the Polaroid factors are applied consistently and clearly over time that the relevant distinctions between different factual configurations can emerge.

Summary judgment is appropriate where "the undisputed evidence would lead only to one conclusion under the Polaroid test." Sports Auth., 89 F.3d at 960 (internal quotation omitted). The Court's role "is to determine whether any reasonable trier of fact could conclude that confusion is likely." Id. (internal quotation omitted). Thus, the Court should analyze each of the Polaroid factors in turn to determine whether the parties' factual presentations raise a genuine issue of material fact. Id.

1. The "strength" of a mark is a measure of "`its tendency to identify the goods [or services] sold under the mark as emanating from a particular, although possibly anonymous, source.'" Sports Auth., 89 F.3d at 960-61 (quoting McGregor-Doniger, 599 F.2d at 1131) (alteration in original). In gauging a mark's strength, a court must consider both the inherent distinctiveness of the mark along with the mark's distinctiveness in the marketplace. See Time, 173 F.3d at 118; W.W.W. Pharmaceutical Co. v. Gillette Co., 984 F.2d 567, 572 (2d Cir. 1993). The analysis requires consideration of many of the same factors that initially determine the trademark's protectiblity. See Paco Sport Ltd. v. Paco Rabanne Parfums, 86 F. Supp.2d 305, 312 (S.D.N.Y. Feb. 17, 2000).

As discussed above, the "CACHE" mark is classified as arbitrary when applied to the goods and services at issue and the defendants do not dispute this. "When a mark has been deemed arbitrary, as opposed to generic, descriptive, or suggestive, its very arbitrariness is an indicium of strength." Morningside Group, 182 F.3d at 139; see also Time, 173 F.3d at 118 ("The strongest marks are arbitrary or fanciful marks, which are entitled to the fullest protection against infringment."); Sports Auth., 89 F.3d at 961 (stating that "arbitrary marks will almost always be seen as strong marks")

The Court of Appeals for the Second Circuit, however, has explained:

[A]lthough denominating a mark "arbitrary" can be useful in focusing the inquiry, the strength of a mark "depends ultimately on its distinctiveness, or its `origin-indicating' quality, in the eyes of the purchasing public." Just as an invented, even bizarre term can lose a measure of trademark protection if it has "become merely descriptive of the product," so too can the distinctiveness of an arbitrary mark be diluted by third party use.

The defendants argue that the "CACHE" mark, although arbitrary, is weak in connection with watches because the plaintiff does not sell watches under the "CACHE" name and watches constitute a small percentage of goods sold by the plaintiff. A mark's strength, however, "is examined principally in the market in which the mark is used." Morningside Group, 182 F.3d at 139. It is undisputed that the plaintiff has been using the "CACHE" mark on substantially all its ladies' clothing merchandise for over 14 years, and that the plaintiff has extensively advertised its mark. (Pl.'s. Ex. 20, ¶ 13, 23.) The defendants do not point to any other use of the mark for retail clothing stores or ladies' clothing.

The defendants also contend that the "CACHE" mark is weakened by third party use of the marks "CACHE" and "CACHET." The defendants do not provide any evidence that third parties other than the defendants are using the name "CACHE". As to the "CACHET" mark, although third party use may be relevant to the strength of a mark, see Sports Auth., 89 F.3d at 961, evidence of registration alone does not establish the extent to which such marks are actually used or promoted or the degree to which they have weakened the plaintiff's mark. See Jordache Enterprises, Inc. v. Levi Strauss Co., 841 F. Supp. 506, 516 n. 11 (S.D.N Y 1993). The defendants provide no evidence of actual commercial use of the "CACHET" mark, and the Court therefore cannot evaluate the extent to which the existence of these marks may impair the strength of the plaintiff's mark. In addition, the "CACHET" mark is not identical to the plaintiff's mark. Thus, given the arbitrariness of the plaintiff's mark and the plaintiff's undisputed evidence of the plaintiff's extensive use and promotion of the mark for retail clothing stores and ladies' clothing, the defendants have not shown that the plaintiff's "CACHE" mark is weak as a matter of law. Drawing all inferences in the plaintiff's favor, a trier of fact could conclude that the plaintiff's mark is strong. Therefore, this factor weighs in the plaintiff's favor.

2. In considering the degree of similarity between the marks, a court should address "two key questions: (1) whether the similarity between the two marks is likely to cause confusion and (2) what effect the similarity has upon prospective purchasers. In deciding whether the marks are similar as used, [a court does] not look just at the typewritten and aural similarity of the marks, but how they are presented in the marketplace." Sports Auth., 89 F.3d at 962 (citation omitted). Here, the parties' marks are spelled the same with an accent on the last letter, the marks are pronounced the same, and the marks are not used in conjunction with other words or phrases. The marks, however, have different typefaces. See Edison Brothers Stores, Inc. v. Cosmair, Inc., 651 F. Supp. 1547, 1556 (S.D.N.Y. 1987) ("Differences in the typeface of the marks are considered in determining the similarity between the two."). The "CACHE" mark used by the plaintiff is in block typeface with some letters slightly angled to either the left or right. (See Pl.'s Ex. 5) The defendants' "CACHE" mark is in scripted form. (See Defs.' Ex. I at 109-110; Ex. O.) From this record, it appears that a reasonable trier of fact could conclude that the defendants' use of "CACHE" is similar to that of the plaintiff's "CACHE" mark. See Sports Auth., 89 F.3d at 962. Accordingly, for purposes of the defendants' summary judgment motion, this factor favors the plaintiff.

3. In considering the proximity of the products, a court should "consider whether the two products compete with each other." W.W.W. Pharm., 984 F.2d at 573. The focus of the product proximity inquiry is "the likelihood that customers may be confused as to the [s]ource of the products, rather than as to the products themselves. . . ."McGregor-Doniger, 599 F.2d at 1134; see also Arrow Fastener, 59 F.3d at 396. In examining this factor a court should compare all aspects of the products, including price, style, intended used, target clientele, typical distribution channels, and others. See Paco Sport, 86 F. Supp.2d at 316.

The plaintiff operates a chain of retail stores selling ladies' clothing and accessories. Caché stores are located primarily in shopping malls. (Reinckens Dec. ¶¶ 2, 11.) Caché products bearing the "CACHE" mark are sold exclusively through Caché stores, catalogs, and Caché's web site. (Pl.'s Ex. 20 ¶ 15.) The plaintiff asserts that Caché stores have been selling watches since about 1995. (Pl.'s Ex. 20 ¶¶ 29, 30.) The price of the watches sold by the plaintiff typically range between $50 and $100 and are similar in quality to similar merchandise sold in high-end department stores. (Pl.'s Ex. 20 ¶ 32.) The plaintiff has never purchased or sold watches bearing the trademark "CACHE" and the watches sold by Caché typically bear the tradename of the manufacturer. (Pl.'s Ex. 20 ¶ 32.) The plaintiff, however, attaches price tags bearing the "CACHE" mark to the watches it sells. (Defts.' Second 56.1 St. ¶ 27; Pl.'s Second 56.1 Counter-St. ¶ 27; Pl.'s Ex. 21, ¶ 2; Ex. 24 ¶ 12.)

The defendant Berger manufactures "CACHE" watches and the other defendants are retail sellers. Macy's and Mervyn's are found in some malls that also have Caché stores. (Pl.'s Ex. 20 ¶ 11; Pl.'s Ex. 37 at 27.) The retail prices for "CACHE" watches sold by these defendants range between $25 to $35 depending on the style. (Defs.' Ex. I at 141-48.)

Both Caché's merchandise and Berger's watches are targeted at women. Consumers who shop in shopping malls and in both large department stores and boutiques are likely to encounter both parties' products, including watches sold at Caché stores. See Clinique Laboratories, Inc. v. Dep Co., 945 F. Supp. 547, 554 (S.D.N.Y. 1996) (finding that "cross-shopping" may create likelihood of confusion). In addition, upon seeing the "CACHE" mark on watches in department stores, a consumer could reasonably conclude that the plaintiff elected to enter into the watch market. See Lois Sportswear U.S.A. v. Levi Strauss, 799 F.2d 867, 874 (2d Cir. 1986). Moreover, although Caché does not sell watches bearing the "CACHE" mark, the parties sell watches in stores targeted at similar customers in similar channels of trade. Although the watches sold by the parties' are different in price, the price difference is not so great that a trier of fact could not reasonably conclude that the products are in such close competition as to create a likelihood of confusion. Thus, there is a genuine disputed issue of fact as to whether the products are sufficiently proximate to create a likelihood of confusion.

4. "Bridging the gap refers to the `senior user's interest in preserving avenues of expansion and entering into related fields.'" Hormel Foods, 73 F.3d at 504 (quoting C.L.A.S.S. Promotions, Inc. v. D.S. Magazines, Inc., 753 F.2d 14, 18 (2d Cir. 1985)). This factor involves a determination of the likelihood that the plaintiff will enter the defendants' business or of the average customers' perception that the plaintiff would enter the defendants' market. See Sports Auth., 89 F.3d at 963. The plaintiff has shown no affirmative intention of selling watches bearing the "CACHE" mark on the face of the watch. (Pl.'s Ex. 24 ¶ 13.) The plaintiff, however, has been selling watches as part of the range of the merchandise that it sells in its stores and attaches tags to indicate that the watches have come from one of its stores. Thus, there remains a genuine factual dispute as to whether consumers would perceive a gap at all, or would assume that any gap has already been bridged.

5. "For purposes of the Lanham Act, actual confusion means `consumer confusion that enables a seller to pass off his goods as the goods of another.'" Sports Auth., 89 F.3d at 963 (quoting W.W.W. Pharmaceutical, 984 F.2d at 574 (quotation and citation omitted)). Evidence of actual consumer confusion is not required to justify a finding of a likelihood of confusion, although the presence of actual confusion supports such a finding. See Les Ballets Trockadero de Monte Carlo, Inc. v. Trevino, 945 F. Supp. 563, 571 (S.D.N.Y. 1996). To show actual confusion, the plaintiff must demonstrate that the defendants' use "could inflict commercial injury in the form of either a diversion of sales, damage to goodwill, or loss of control over reputation." Lang v. Retirement Living Publishing Co., Inc., 949 F.2d 576, 583 (2d Cir. 1991). The plaintiff points to five instances of actual confusion. Three of the instances, as related by the plaintiff's sales representatives, involve people attempting to return the defendants' "CACHE" watches received as gifts to the plaintiff's stores. (Pl.'s Ex. 30 at 30-32; Ex. 31 at 8-11; Ex. 32 at 9-10.) The plaintiff also has introduced two e-mail inquiries addressed to the plaintiff's customer service department. (Pl.'s Ex. 29; Ex. 33.) The first e-mail is an inquiry from a person who has purchased a watch and matching bracelet at Service Merchandise and was seeking another set from the plaintiff. (Pl.'s Ex. 29.) The second e-mail is an inquiry regarding whether the plaintiff carries "CACHE" watches with a matching bracelet and the price range. (Pl.'s Ex. 33.)

The defendants argue that the evidence regarding instances of people attempting to return Berger's watches to the plaintiff is inadmissible hearsay because the plaintiff's employees, and not the actual person returning the watch, anecdotally describe the alleged incidents of actual confusion. These statements, however, may be received into evidence to show the declarant's state of mind. See Fed.R.Evid. 803(3);Fun-Damental Too Ltd. V. Gemmy Indus. Corp., 111 F.3d 993, 1003-04 (2d Cir. 1997) (determining that the plaintiff's national sales manager's testimony concerning complaints from retail customers was admissible under the state of mind exception to the hearsay rule and was probative of the declarant's confusion). In this case, statements made by persons attempting to return the defendants' watches to the plaintiff are admissible to show the person's state of mind, namely the person's confusion as to the watch's origin.

The defendants also argue that the plaintiff's proffered evidence of actual confusion is not evidence of actual confusion because it does not show that the purchasers of the watches were confused as to source. The focus, however, is on consumers, not just actual purchasers. Evidence of actual confusion "need not be limited to evidence of mistaken completed transactions. . . . Instead, evidence of actual confusion regarding affiliation or sponsorship is also entirely relevant to the ultimate likelihood-of-confusion inquiry." Morningside Group, 182 F.3d at 141. In this case, the plaintiffs have offered evidence that some people who have been given one of the defendants' watches as a gift believe that the watch came from the plaintiff and that is evidence of consumer confusion with respect to affiliation and sponsorship. Cf. Bear U.S.A., Inc. v. Kim, 71 F. Supp.2d 237, 252 (S.D.N.Y. 1999), aff'd, 216 F.3d 1071 (2d Cir. 2000) (finding some evidence of actual confusion where a dissatisfied purchaser of the defendant's products attempted to return them to the plaintiff).

Thus, although the evidence of actual confusion submitted by the plaintiff is minimal, drawing all inferences in the plaintiff's favor, a trier of fact could conclude that there was actual confusion. See something Old, Something New, Inc. v. OVC. Inc. 98 Civ. 7450, 1999 WL 1125063, at *9 (S.D.N Y Dec. 8, 1999) (finding that the plaintiffs' submission of a single declaration of a person detailing her confusion, albeit slight evidence of actual confusion, was sufficient to create a genuine issue of fact); Bear U.S.A., 71 F. Supp.2d at 252 (finding that one piece of anecdotal evidence suggesting actual confusion, although minimal evidence, was sufficient to find that Polaroid's actual confusion factor favored the plaintiff); Gayle Martz, Inc. v. Geo Global Group, Inc., No. 96 Civ. 4650, 1998 U.S. Dist. LEXIS 6295, at *7 (S.D.N.Y. Apr. 30, 1998) (finding that evidence of one instance of actual confusion may satisfy the actual consumer confusion standard, shifting the burden to the defendant to show the absence of consumer confusion); Russian Kurier, Inc. v. Russian American Kurier, Inc., 899 F. Supp. 1204, 1206 (S.D.N Y 1995) (concluding that actual confusion existed on the basis of five affidavits submitted by the plaintiffs from individuals claiming to have mistaken the defendant's product as the plaintiff's)

In addition, the plaintiff offers survey evidence to support the existence of actual confusion. (Pl.'s Ex. 28.) The results of the plaintiff's study, administered by RL Associates, indicate that 51% of consumers, upon seeing a watch with the name "CACHE" written on it in a store other than Caché, would be likely to think that the watch came from the plaintiff. (Pl.'s Ex. 28 at 13.)

A survey is probative and may be admitted into evidence to establish actual confusion if it is "fairly prepared and its results directed to relevant issues." Sterling Drug, Inc. v. Bayer AG, 14 F.3d 733, 741 (2d Cir. 1994) (quotations omitted) Errors in methodology properly go to the weight of the survey evidence. See Schering Corp. v. Pfizer Inc., 189 F.3d 218, 227-28 (2d Cir. 1999); Lois Sportswear, 799 F.2d at 875. A survey, however, should be excluded under Fed.R.Evid. 403 where it is so flawed in methodology that its probative value is substantially outweighed by its prejudicial effect. See Schering, 189 F.3d at 228;Starter Corp. v. Converse, Inc., 170 F.3d 286, 297 (2d Cir. 1999);Arche, Inc. v. Azaleia, U.S.A. Inc., 882 F. Supp. 334, 336 (S.D.N Y 1995).

The defendants challenge the methodology used in the plaintiff's survey and argue that the survey does not support a showing of likelihood of confusion, but, despite the survey's flaws, the survey does not appear to be devoid of all probative value on the issue of the likelihood of confusion. See Franklin Resources, Inc. v. Franklin Credit Management Corp., No. 95 Civ. 7686, 1997 WL 543086, at *6 (S.D.N.Y. Sept. 4, 1997) (survey with significant flaws in its universe still has probative value)Schieffelin Co. v. Jack Co. of Boca, Inc., 850 F. Supp. 232, 246 (S.D.N.Y. 1994) (same). The survey results still have some relevance to the issue of how potential purchasers would react when presented with Berger's "CACHE" watches. Any flaws in the survey are factored into the weight to be given to the evidence. The survey results, together with the anecdotal evidence of actual confusion, lend support to the plaintiff's argument of actual confusion, which supports the plaintiff's contention of a likelihood of confusion.

6. Bad faith is shown by demonstrating that the "defendant adopted its mark with the intention of capitalizing on [the] plaintiff's reputation and goodwill and any confusion between his and the senior user's product." Arrow Fastener, 59 F.3d at 397 (quoting Lang, 949 F.2d at 583 (quotation omitted)). Many factors influence this determination. "Good faith can be found if a defendant has selected a mark which reflects the product's characteristics, has requested a trademark search or has relied on the advice of counsel." Sports Auth., 89 F.3d at 964 (quoting W.W.W. Pharmaceutical, 984 F.2d at 575). A failure to conduct a trademark search prior to use, especially when counsel advises otherwise, indicates bad faith, see Int'l Star Class Yacht Racing Ass'n ("ISCYRA") v. Tommy Hilfiger, 80 F.3d 749, 753 (2d Cir. 1996), although failure to consult counsel does not show bad faith per se. See Streetwise Map. Inc. v. Van Dam, 159 F.3d 739, 746 (2d Cir. 1998); Car-Freshener Corp. v. S.C. Johnson Son, Inc., 70 F.3d 267, 270 (2d Cir. 1995). "Prior knowledge of a senior user's trade mark does not necessarily give rise to an inference of bad faith and may be consistent with good faith." Arrow Fastener, 59 F.3d at 397. The defendant's conduct after becoming aware of possible infringement, however, can indicate bad faith. See ISCYRA, 80 F.3d at 754 (finding that district court erred when it failed to consider, in analyzing bad faith evidence, the defendant's continued use of the mark after the plaintiff's filing of the lawsuit gave the defendant notice of its potential trademark violation).

The parties dispute the existence of good faith. The defendants' contend that they adopted the "CACHE" mark in good faith, without knowledge of the plaintiff's stores, and without the intent to misappropriate any of the plaintiff's goodwill. The defendants maintain that Berger selected the name "CACHE" because it was Sears' preference. A Sears' representative selected the name "CACHE" after looking at Vogue magazine for words that would fit the watch and making a list of proposed names. (Def s.' Ex. K.) The defendants argue that they had no knowledge of the plaintiff's mark prior to first using the "CACHE" mark. They contend that Berger conducted a trademark search for watches before using the mark and that the search did not reveal any existing registrations for the "CACHE" name for watches, although there are no documents reflecting the alleged search. (Defs.' Ex. H at 15-16; Ex. I at 106-07; Ex. J at 56-57.)

There are, however, significant indications of bad faith. Berger did not consult with counsel prior to using the "CACHE" mark, nor did it appear to conduct a full trademark search for "CACHE." (Pl.'s Ex. 38 at 56-58.) As part of the process of selecting the "CACHE" mark, the record indicates that individuals at both Sears and Berger looked through issues of Vogue magazine to find appropriate names. (Pl.'s Ex 26 at 89-91; Ex 39 at 13-14.) It is plain that there was an ad for Caché in at least one of those issues of Vogue. (Pl.'s Ex. 40.) Employees of Berger and Sears made the ultimate decision to use the "CACHE" mark. (Defs.' Ex. I at 105.) Moreover, the mark that Berger chose to use is the same mark that the plaintiff uses — spelled in the same way, right down to the use of the accent — and at one time, with respect to the "CACHE" watches Berger sold to Mervyn's, Berger used buff and gold packaging similar to the plaintiff's packaging. (Pl.'s Ex. 20 ¶ 18; Defs.' Ex. O.) In addition, the defendants continued to use the "CACHE" mark after they became aware of the plaintiff's use of the "CACHE" mark and after receiving the plaintiff's cease and desist letters.

Where "the evidence does not conclusively point to a finding of good faith or bad faith, . . . this issue, like many intent issues, is best left in the hands of the trier of fact." Sports Auth., 89 F.3d at 964;Cadbury Beverages, Inc. v. Cott Corporation, 73 F.3d 474, 483 (2d Cir. 1996). The evidence presented is sufficient to raise a genuine issue of fact whether there was bad faith in defendants' use of the "CACHE" mark on watches that cannot be resolved on a summary judgment motion.

7. The analysis of the quality of the defendants' product "is primarily concerned with whether the senior user's reputation could be jeopardized by virtue of the fact that the junior user's product is of inferior quality." Arrow Fastener, 59 F.3d at 398. Although the plaintiff argues that it suffers harm when its name is associated and confused with products sold in other stores in a way that diminishes the prestige and image of a product purchased at a Caché store, it has failed to introduce any specific evidence that Berger's watches are of inferior quality to the goods sold by the plaintiff. The plaintiff does not dispute that the quality of the Berger watches is similar to the quality of the watches sold by Caché and that some of the prices of the watches are quite similar. (Pl.'s 56.1 Counter-St. Concerning Damages, dated Jul. 17, 2000 ("Pl.'s First 56.1 St."), ¶ 22; Pl.'s Ex. 20, ¶ 44.)

While Caché's reputation may not be jeopardized if consumers thought that Caché was the source of Berger's watches, the defendants' use of the Caché name does leave Caché's reputation in the hands of Berger and the fact that the products are similar may support the consumers' belief that the products emanate from the same source and thus contribute to consumer confusion. See Morningside Group, 182 F.3d at 142 (finding that comparable quality of plaintiff's and defendant's similar financial services increased the likelihood of confusion) Therefore, drawing all inferences in favor of the plaintiff, the trier of fact may reasonably find that the similar quality of the products in this case contributes to the likelihood of confusion.

8. In considering the sophistication of consumers, a court must evaluate "[t]he general impression of the ordinary purchaser, buying under the normally prevalent conditions of the market and giving the attention such purchasers usually give in buying that class of goods. . . ."McGregor-Doniger, 599 F.2d at 1137 (quoting 3 R. Callman, The Law of Unfair Competition, Trademarks and Monopolies § 81.2, at 577 (3d ed. 1969)); see also Sports Auth., 89 F.3d at 965; W.W.W. Pharm., 984 F.2d at 575. In likelihood of confusion. See Centaur Communications, 830 F.2d at 1228.

The parties have not submitted evidence as to the level of sophistication their customers possess. However, given the similarity of the marks, the relatively modest price for the watches at issue, and the markets for the parties' products, the defendants have not met their burden of showing that there are no genuine issues of fact as to whether any lack of sophistication of the buyers contributes to the likelihood of confusion. On a motion for summary judgment, this factor tips in favor of the plaintiff as the non-moving party.

The Polaroid factors must be weighed as a whole and this process is not a "mechanical process." Arrow Fastener, 59 F.3d at 400; see also Sports Auth., 89 F.3d at 965. Drawing all inferences in favor of the plaintiff, there remain genuine disputed issues of fact with respect to each of thePolaroid factors that should be resolved by a trier of fact. See Sports Auth., 89 F.3d at 965; Cadbury Beverages, 73 F.3d at 483-84.

C.

The defendants also argue that, even if the plaintiff can sufficiently demonstrate a likelihood of confusion, the plaintiff should be denied an injunction for equitable reasons.

The defendants first argue that the balance of equities weighs decidedly in their favor. Even where a party has a valid trademark and there is a finding of a likelihood of confusion, the issuance of an injunction barring use of the junior user's mark is not mandatory. See Jim Beam Brands Co. v. Beamish Crawford, Ltd., 937 F.2d 729, 737 (2d Cir. 1991). "Rather the court may, after equitably balancing the conflicting interests of the parties involved, . . . determine that no injunctive relief would be appropriate. . . ." Id. (internal quotations and citation omitted); see also Vitarroz, 644 F.2d at 969; Mushroom Makers, Inc. v. R.G. Barry Corp., 580 F.2d 44, 48-49 (2d Cir. 1978) (per curiam). The defendants rely heavily on Mushroom Makers, in which the Court of Appeals for the Second Circuit upheld a district court's decision to deny injunctive relief, finding that, although likelihood of confusion was established as a matter of law, "the [junior user's] interest in retaining the goodwill developed through concurrent use an identical trademark far outweigh[ed] any conceivable injury to [the senior user]." Mushroom Makers, 580 F.2d at 49. In Mushroom Makers, however, the parties agreed that there was no likelihood of "bridging the gap," the evidence of actual confusion was de minimis, and the district court concluded there was no bad faith. See id. at 47-49. In this case there are material issues of fact as to whether the defendants' use of the "CACHE" mark was in bad faith, whether there is actual confusion, and whether there is a "gap" between the products involved. Moreover, the plaintiff has submitted evidence that Berger has not developed appreciable goodwill in the "CACHE" name. (Pl.'s Ex. 23 at 29-32.) Thus, the defednants have not established that, as an equitable matter, the plaintiff will not be entitled to injunctive relief after trial.

The defendants also argue that the plaintiff's delay in bringing suit for more than three years precludes the granting of injunctive relief. "Laches is an equitable defense that bars injunctive relief where a plaintiff unreasonably delays in commencing an action." Tri-Star Pictures, Inc. v. Leisure Time Productions, B.V., 17 F.3d 38, 44 (2d Cir. 1994). To prove a defense of laches a defendant must show: (1) that the plaintiff had knowledge of the defendant's use of its mark; (2) that the plaintiff inexcusably delayed in taking action; and (3) that the defendant will be prejudiced if the plaintiff belatedly asserted its rights. See id. The determination of whether laches bars injunctive relief requires a factual inquiry which depends on the circumstances of each case. See id. It is well established, however, that "`laches is not a defense against injunctive relief when the defendant intended the infringement.'" Hermes Int'l v. Lederer De Paris Fifth Ave., Inc., 219 F.3d 104, 107 (2d. Cir. 2000) (quoting Harlequin Enters. Ltd. v. Gulf W. Corp., 644 F.2d 946, 950 (2d Cir. 1981)). The laches defense, therefore, does not bar injunctive relief in this case where there are issues of fact as to whether the defendants' use of the "CACHE" mark was in bad faith. Thus, the defendants' motion for summary judgment with respect to the plaintiff's request for injunctive relief is denied.

IV.

The defendants also move for partial summary judgment to dismiss the plaintiff's claims for damages, an accounting of the defendants' profits and attorneys' fees. The plaintiff asserts these claims for monetary relief pursuant to Section 35(a) of the Lanham Act, 15 U.S.C. § 1117(a), which provides:

the plaintiff shall be entitled, . . . subject to the principles of equity, to recover (1) defendant's profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action. . . . The court in exceptional cases may award reasonable attorney fees to the prevailing party.

A.

In this case, the plaintiff conceded at the argument of these motions that it has not presented any evidence of actual damages and that it was only seeking an award of the defendants' profits.

"While damages directly measure the plaintiff's loss, defendant's profits measure the defendant's gain." George Basch Co., Inc. v. Blue Coral, Inc., 968 F.2d 1532, 1540 (2d Cir. 1992). The unavailability of actual damages does not preclude an award of profits, ISCYRA, 80 F.3d at 753; Tin Pan Apple, Inc. v. Miller Brewing Co., Inc., NO. 88 Civ. 4085, 1994 WL 62360, at *8 (S.D.N.Y. Feb. 24, 1994), but "a finding of defendant's willful deceptiveness is a prerequisite for awarding profits." George Basch, 968 F.2d at 1537, 1540; see also ISCYRA, 80 F.3d at 753 ("In order to recover an accounting of an infringer's profits, a plaintiff must prove that the infringer acted in bad faith.").

The Court of Appeals for the Second Circuit has noted that a finding of willful deceptiveness may not, by itself, be sufficient to warrant an accounting of profits. See George Basch, 968 F.2d at 1540. In addition, a court, despite finding willful infringement, should generally consider equitable factors, such as: "(1) the degree of certainty that the defendant benefited from the unlawful conduct; (2) availability and adequacy of other remedies; (3) the role of a particular defendant in effectuating the infringement; (4) plaintiff's laches; and (5) plaintiff's unclean hands." Id.

In this case, the only argument that the defendants make with respect to the plaintiff's claim for an accounting of profits is that there was no bad faith. As discussed above, there are disputed material facts with respect to bad faith on the part of the defendants. The defendants also argue that, even if bad faith is established with respect to Berger, there is insufficient evidence to show bad faith on the part of Mervyn's, Macy's, Macy's.com, or Service Merchandise who had indemnities from Berger and thus could rely on Berger's claim that it had ensured that there was no infringement.

Even though a retail seller of a product is not involved with the manufacture of a product or the affixing of an infringing mark to a product, "its sale of the [product] is sufficient `use' for it to be liable for the results of such infringement and its claimed lack of knowledge of its supplier's infringement, even if true, provides no defense." El Greco Leather Prod. Co v. Shoe World, Inc., 806 F.2d 392, 396 (2d Cir. 1986); see also Stabilisierungsfonds Fur Wein v. Kaiser Stuhl Wine Distributors Pty. Ltd., 647 F.2d 200, 207 (D.C. Cir. 1981) ("Courts have long held that in . . . trademark . . . cases, any member of the distribution chain can be sued as an alleged joint tortfeasor.");Gucci America, Inc. v. Action Activewear, Inc., 759 F. Supp. 1060, 1066-67 (S.D.N.Y. 1991) (finding that a non-manufacturing retailer is liable for trademark infringement by selling counterfeit goods even if the retailer acts in good faith); Shen Mfg. Co. v. Suncrest Mills, Inc., 673 F. Supp. 1199, 1201 (S.D.N.Y. 1987) (finding retailer who innocently purchased infringing products liable under Lanham Act and subjected to injunction, but need not pay profits). In this case, there is an issue of fact as to whether the retail defendants' continued sales after the plaintiff sent cease and desist letters and after the filing of this lawsuit constituted willful infringement on the part these retail sellers. See ISCYRA, 80 F.3d at 754; see also Aris Isotoner, Inc. v. Dong Jin Trading Co., Inc., No. 87 Civ. 890, 1989 WL 236526, at *5 (S.D.N Y Sept. 22, 1989) (awarding an accounting of profits after concluding that although the defendant did not itself manufacture the infringing goods, it sold them with knowledge that they were intended to look like the plaintiff's product). Thus, summary judgment for any of the defendants is not warranted with respect to the plaintiff's claim for an accounting of profits.

B.

An award of attorneys' fees is permitted only in "exceptional cases." 15 U.S.C. § 1117(a). Such an award "may be justified when bad faith infringement has been shown." ISCYRA, 80 F.3d at 753; see also Bambu Sales. Inc., Ozak Trading Inc., 58 F.3d 849, 854 (2d Cir. 1995). Because the existence bad faith remains an issue in this case, the plaintiff's request for attorneys' fees cannot be resolved at this time. See Sterling Drug, 14 F.3d at 751 ("The issue of attorney's fees involves a consideration of whether [the defendant] has acted in bad faith, a matter more appropriately considered after a complete airing of all aspects of the dispute between the parties."). The defendants motion to dismiss the plaintiff's request for attorneys' fees is therefore denied.

V.

The defendants also moved to strike the plaintiff's jury demand. However, the defendants conceded at the argument of the pending motions that Caché's claim for an accounting of profits gives rise to a right to a trial by jury. See Daisy Group, Ltd. v. Newport News, Inc., 999 F. Supp. 548, 551-52 (S.D.N.Y. 1998) (finding that there is a right to a jury trial when profits are sought as a rough proxy measure of damages) Ideal World Marketing, Inc. v. Duracell. Inc., 997 F. Supp. 334, 338-39 (S.D.N.Y. 1998) (finding that there is a right to a jury trial when an award of profits is sought); Gucci America, Inc. v. Accents, 994 F. Supp. 538, 540-41 (S.D.N.Y. 1998) (finding that there is a right to a jury trial when profits are sought for the purpose of deterrence); but see G.A. Modefine S.A. v. Burlington Coat Factory Warehouse Corp., 888 F. Supp. 44, 45-46 (S.D.N Y 1995) (concluding that disgorgement of profits is an equitable remedy, therefore, there is no right to a jury trial). Because the plaintiff's claim for an accounting of profits remains, the defendants' motion to strike the jury demand is denied.

CONCLUSION

For the foregoing reasons, the defendants' motion for summary judgment are denied.

SO ORDERED.