author: Justice Breyer Justice Thomas, Justice Stevens,

text:
    KANSAS v. COLORADO
    No. 105,
    Orig.
    Argued October 4, 2004
    Decided December 7, 2004

      Breyer, J., delivered the opinion of the Court, in which Rehnquist, C. J., and O’Connor, Scalia, Kennedy, Souter, and Ginsburg, JJ., joined, and in which Stevens and Thomas, JJ., joined except for Part II. Thomas, J., filed an opinion concurring in part and concurring in the judgment, post, p. 106. Stevens, J., filed an opinion concurring in part and dissenting in part, post, p. 107.

      John B. Draper, Special Assistant Attorney General of Kansas, argued the cause for plaintiff.. With him on the briefs were Phill Kline, Attorney General, Eric Rucker, Chief Deputy Attorney General, David Davies, Deputy Attorney General, Harry Kennedy, Assistant Attorney General, Leland E. Rolfs, Special Assistant Attorney General, and Andrew S. Montgomery.

      David W. Robbins, Special Assistant Attorney General of Colorádo, argued the cause for defendant. With him on the brief were Ken Salazar, Attorney General, Carol D. Angel, First Assistant Attorney General, and Dennis M. Montgomery, Special Assistant Attorney General.

      James A. Feldman argued the cause for the United States. With him on the brief were former Solicitor General Olson, Assistant Attorney General Sansonetti, Deputy Solicitor General Kneedler, Jeffrey P. Minear, and Patricia Weiss.

   Justice Breyer

delivered the opinion of the Court.

We again consider a long-running water dispute between Colorado and Kansas. The water is that of the Arkansas River, once proudly called the “Nile of America.” The river originates high in the Rocky Mountains. It runs eastward' through Colorado, Kansas, Oklahoma, and Arkansas, before joining the Mississippi near the town of Arkansas Post. For decades, Kansas and Colorado disagreed about the division of its upper waters. See Kansas v. Colorado, 206 U. S. 46 (1907); Colorado v. Kansas, 320 U. S. 383 (1943). In 1949, they entered into an interstate compact. See Arkansas River Compact (Compact), 63 Stat. 145 (agreeing to “[equitably divide and apportion” the waters (internal quotation marks omitted)). But the disagreements have persisted.

Present proceedings began in 1985, when Kansas charged that Colorado had violated the Compact. Kansas pointed out that Compact Art. IV-D says:

“This Compact is not intended to impede or prevent future beneficial development of the Arkansas River basin in Colorado and Kansas by Federal or State agencies, by private enterprise, or by combinations thereof, which may involve construction of dams, reservoir, and other works for the purposes of water utilization and control, as well as the improved or prolonged functioning of existing works: Provided, that the waters of the Arkansas River, as defined in Article III, shall not be materially depleted in usable quantity or availability for use to the water users in Colorado and Kansas under this Compact by such future development or construction.” Id., at 147 (emphasis added and internal quotation marks omitted).

Kansas submitted that Colorado “development,” in particular increases in ground water consumption through new and existing irrigation wells, had “materially depleted” the water otherwise available “for use” by Kansas’ “water users.” Our appointed Special Master agreed, recommending that we find that Colorado had unlawfully depleted the river in violation of Art. IV-D. 2 First Report of Special Master 336 (hereinafter Report). We accepted the Special Master’s recommendations and remanded the case for remedies. Kansas v. Colorado, 514 U. S. 673, 694 (1995) (Kansas I).

The Special Master set forth proposed remedies in his Second and Third Reports. He said that Colorado had over-depleted more than 400,000 acre-feet of usable river flow from 1950 through 1994. Second Report 112. He recommended that Colorado pay Kansas monetary damages to make up for the depletions. Third Report 119. He divided losses into six categories, calculating damages somewhat differently in each category. See id., at 120. And he recommended that Kansas be awarded prejudgment interest on damages reflecting losses incurred from 1969 through 1994. Id., at 107. We subsequently adopted the Special Master’s recommendations with one exception; we held prejudgment interest would run from 1985 (not 1969). Kansas v. Colo rado, 533 U. S. 1, 15-16 (2001) (Kansas III). See infra, at 95-97. And we remanded the case. 533 U. S., at 20.

The Master has now filed a Fourth Report setting forth his resolution of certain remaining issues. Kansas takes exception to several of the Fourth Report’s recommendations. We overrule Kansas’ exceptions and adopt all of the Special Master’s recommendations.

I

Kansas, asked the Special Master to recommend that we appoint a River Master with authority to decide (within clear error limits) various technical disputes related to decree enforcement. See Texas v. New Mexico, 482 U. S. 124, 134 (1987) (appointing a River Master to-“make the calculations provided for in [a] decree” concerning the Pecos River). The Special Master rejected Kansas’ request, recommending instead that “the Court retain continuing jurisdiction in this case for a limited period of time” to permit the Special Master himself to resolve any lingering issues (subject, of course, to this Court’s review). Fourth Report 135. Kansas here renews its request for appointment of a River Master.

We recognize that this Court has previously appointed a River Master to help resolve water-related disputes among States. Texas v. New Mexico, supra, at 134-135; New Jersey v. New York, 347 U. S. 995, 1002-1004 (1954). But it has done so only twice before, each time on recommendation of the Special Master, always as a discretionary matter, and only because it was convinced that such an appointment would significantly aid resolution of further disputes. See Vermont v. New York, 417 U. S. 270, 275 (1974) (per curiam) (“[I]t is a rare case” where we will install a River Master). We are not convinced that such an appointment is appropriate here.

For one thing, further disputes in this case, while technical, may well require discretionary, policy-oriented decision-making directly and importantly related to the underlying legal issues. In this respect, potential disputes in this case differ at least in degree from those that we have asked River Masters to resolve. Implementation of the Pecos River Decree, for example, involved application of a largely noncontroversial mathematical curve. The curve correlates inflows at various New Mexico River locations with expected outflows so that engineers can estimate, for any given inflow, the amount of water that is required to be available for Texas’ use. See Texas v. New Mexico, 462 U. S. 554, 572-573 (1983); see also Texas v. New Mexico, 446 U. S. 540 (1980) (per curiam). Lingering disputes between Texas and New Mexico, we thought, would involve not the curve’s shape but whether officials had properly measured the flows. 482 U. S., at 134-135. Although these disputes might call for a “degree of judgment,” they would often prove capable of mechanical resolution and would usually involve marginal calculation adjustments. Id., at 134; see id., at 135-136; Fourth Report 128 (The Pecos River Master “does not adjudicate the kinds of disputes” potentially at issue here).

Administration of the decree in this case, by contrast, will involve not a simple curve but a highly complex computer model, the Hydrologic-Institutional Model (H-I Model or Model). The H-I Model seeks to determine just what the precise water flows into Kansas would have been had Colorado not allowed increased consumption of ground water after 1949. See 2 First Report 231. Modeling disputes— and there have been many — involve not just measurement inputs, but basic assumptions underlying the Model. See, e. g., Kansas I, supra, at 685-687; 2 First Report 237-240; Fourth Report 123-124. Their resolution may well call for highly judgmental decisionmaking about matters that (compared to the Pecos) are more importantly related to the parties’ basic legal claims. See id., at 128.

Moreover, the need for a River Master is diminished by the fact that the parties may find it possible to resolve future technical disputes through arbitration. The interstate compact itself creates an Arkansas River Compact Administration (Administration) empowered to resolve differences arising under the Compact. Art. VIII, 63 Stat. 149. The Administration consists of three representatives from each State and a representative of the United States acting as chair. Art. VIII-C. Each State has one vote; the United States has no vote. Art. VIII-D. In ease of an equally divided vote, the Administration (with the consent of both States) may refer a matter for resolution to the “Representative of the United States or other arbitrator or arbitrators.” Ibid, (internal quotation marks omitted). The arbitrator’s determinations are binding. Ibid.

At oral argument, counsel for Kansas suggested a willingness to use arbitration, noting that “in the one case [he was] aware of, Kansas’ suggestion of doing an arbitration was rejected by Colorado.” Tr. of Oral Arg. 17. Colorado’s counsel responded that Colorado had proposed “that binding arbitration be used and has committed itself to participate in that.” Id., at 26; see also Reply Brief for Colorado Opposing Exceptions 15. These comments suggest that neither party opposes arbitration, and indeed that Colorado would accept it. Nor have the parties expressed any opposition to the use of other less formal means to resolve disputes, such as joint consultation with experts, negotiation, and informal mediation. See, e. g., Kansas v. Nebraska, 538 U. S. 720 (2003) (Kansas, Colorado, and Nebraska resolved Republican River dispute by settlement and stipulation); Fourth Report 134 (discussing ongoing “joint efforts” and “cooperation” among the States to resolve lingering disputes over the waters of the Republican River).

The Special Master recommended both binding arbitration and these other less formal methods as alternatives, while opposing appointment of a River Master and observing that such an appointment would “simply” make it “easier to continue this litigation.” Id., at 136.

For all of these reasons, we deny Kansas’ River Master request.

II

Kansas takes exception to the Special Master’s prejudgment interest calculation. The calculation and the objection grow- out of the special history of this litigation.

After we initially remanded this case for remedial determinations, see Kansas I, 514 U. S. 673, the Special Master found that Colorado’s unlawful water depletion had harmed Kansas beginning in 1950 and that Colorado must pay monetary damages reflecting that harm. Kansas asked the Special Master to award prejudgment interest on those damages incurred through 1994. Colorado replied that the Compact — like the common law — did not foresee interest payments in respect to unliquidated claims, particularly where, as here, damages were highly speculative. And even with the best of good will, said Colorado, it still could not have known prior to the filing of the complaint (in 1985) how much it owed Kansas. See Third Report 92-94; Kansas III, 533 U. S., at 11-13; Brief for Defendant in Kansas III, O. T. 2000, No. 105, Orig., pp. 28-32.

The Special Master resolved the argument by deciding to calculate pre judgment interest on the basis of what he called ‘“considerations of fairness.’” Third Report 97 (quoting Board of Comm’rs of Jackson Cty. v. United States, 308 U. S. 343, 352 (1939)). In a kind of Solomonic compromise, he divided the prejudgment period into three temporal subcategories: (1) an Early Period, the period from 1950, when Colorado’s unlawful water depletion began, through 1968, when Colorado should first have known about it; (2) a Middle Period, the period from 1969 through 1984; and (3) a Late Period, the period from 1985, when Kansas filed its complaint, through 1994, the last year for which evidence was available at the time of the trial on damages. He adjusted damages from all three periods (Early, Middle, and Late) for inflation. But he awarded additional prejudgment interest, reflecting Kansas’ loss of use of the money, “only from 1969 to the date of judgment.” Third Report 107. Both Kansas and Colorado interpreted his order as awarding interest only on Middle and Late Damages (1969-1994), not on Early Damages (1950-1968). Kansas III, Exception and Brief for Plaintiff Kansas 9; App. to Fourth Report 12-13. The resulting total damages award, including prejudgment interest, came to $38 million. Ibid.

On appeal to this Court, Colorado attacked the award of any prejudgment interest, while Kansas called for full prejudgment interest. We accepted the Special Master’s equitable approach. We were unable to conclude that Colorado should have known that prejudgment interest would “automatically” be imposed “in order to achieve full compensation.” 533 U. S., at 14. But, we added, Colorado did believe (or should have believed) that we would assess “ ‘considerations of fairness’ ” in order to achieve a just and equitable remedy. Ibid. Hence “the Special Master acted properly ... in only awarding as much pre judgment interest as was required by a balancing of the equities.” Ibid.

The Special Master, we found, properly refused to “award prejudgment interest for any years before either party was aware of the excessive pumping in Colorado.” Id., at 15. We then applied our own “considerations of fairness” and concluded that “prejudgment interest should begin to accrue,” not as of 1969 (the Special Master’s date), but as of 1985. Id., at 14-15. We wrote in an accompanying footnote:

“Justice O’Connor, Justice Scalia, and Justice Thomas would not allow any pre judgment interest.. .. Justice Kennedy and The Chief Justice are of the opinion that prejudgment interest should run from the date of the filing of the complaint [1985]. Justice Squ-ter, Justice Ginsburg, Justice Breyer, and [Justice Stevens] ... agree with the Special Master’s view that interest should run from the time when Colorado knew or should have known that it was violating the Compact [1969]. In order to produce a majority for a judgment, the four Justices who agree with the Special Master have voted to endorse the position expressed in the text.” Id., at 15, n. 5.

On remand, the Special Master, seeking to remain faithful to our determination, calculated prejudgment interest from 1985 onward, and calculated that interest on (post-1984) Late Damages alone, i. e., completely exempting both Early Damages and Middle Damages from prejudgment interest. Kansas now objects to this last-mentioned limitation; it challenges the sum upon which post-1984 interest runs. Kansas says the Special Master should have calculated prejudgment interest (from 1985) on all damages, i. e., on Early Damages, Middle Damages, and Late Damages alike. After all, says Kansas, “[p]rejudgment interest serves to compensate for the loss of use of money due as damages ... thereby achieving full compensation for the injury those damages are intended to redress,” West Virginia v. United States, 479 U. S. 305, 310-311, n. 2 (1987) (citing Comment, Prejudgment Interest: Survey and Suggestion, 77 Nw. U. L. Rev. 192 (1982)). See Exceptions and Brief for Plaintiff 29. Kansas lost the “use of” all the “money due as damages,” i. e., Early and Middle Damages as well (which were “due” at least by 1985). Why then, asks Kansas, calculate post-1984 interest on only some of the damages then due?

Kansas’ argument would make good sense in an ordinary case. But the question here is not about the ordinary case, but rather what the Kansas III paragraph we quoted above means in context. And the Kansas III context is a special one.

For one thing, , like the Special Master, we did not seek to provide compensation for all lost investment opportunities; rather, we sought to weigh the equities. For another, it was apparent that the Special Master’s earlier determination involved both a decision about when to begin .to calculate interest (1969) and what to calculate that interest upon (Middle Damages and Late Damages only). Brief for Plaintiff in Kansas v. Colorado, O. T. 2000, No. 105, Orig., pp. 9, 25, n. 8. All damages incurred before his selected date were totally exempt from interest. Kansas contested the when by arguing that we should award interest for the entire period. Kansas also contested the what by arguing that, even accepting the Special Master’s preferred date, interest should run on Early Damages as well as Middle and Late Damages. See id., at 25, n. 8 (“Even if a defendant’s good-faith ignorance of its breach were a valid reason to deny prejudgment interest, it would not justify the Special Master’s recommendation to deny Kansas compensation for its loss of use of money [reflecting Early Damages] after 1968”).

In overruling Kansas’ exception and sustaining Colorado’s exception, we said nothing about the Special Master’s total exemption of Early Damages. 533 U. S., at 14. Thus, we changed the when (from 1969 to 1985) in Kansas III, but (despite Kansas’ argument) we did not change the methodology for calculating the what. In context, our silence fairly implies acceptance, not rejection, of the Special Master’s underlying methodology. Moving the date forward thus meant moving the exemption period forward as well. And that methodology now yields a post-1985 interest calculation based upon Late Damages only.

This view of our prior opinion is reinforced by the resulting numbers. The Special Master’s original 1969 date (and methodology) produced a total damages award to Kansas, including prejudgment interest, of about $38 million (in 1998 dollars). Were we to accept Kansas’ argument (and calculate post-1984 interest on all damages), the final damages award would be roughly $53 million (in 2002 dollars). App. to Fourth Report 12. We cannot reconcile that numerical result with our acceptance in Kansas III of the Special Master’s equitable approach and with our own equitable determination. That determination implied a modest adjustment of the $38 million award in Colorado’s favor, not, as Kansas now seeks, an adjustment of the award in its own favor. App. to Fourth Report 12.

Consequently, we overrule Kansas’ objection.

l-H

Eansas and Colorado have agreed to use a computer model, the H-I Model, to measure Colorado’s future Compact compliance. This highly complex set of computer programs determines whether Colorado’s post-1949 wells deplete the river of usable water that the Compact makes available for Kansas. It does so by trying to account for almost every Arkansas-River-connected drop of water that arrives in, stays in, or leaves Colorado, whether by way of rain, snow, high mountain streams, well pumping of underground water, evaporation, canal seepage, transmountain imports, reservoir storage, or otherwise. 2 First Report 233-235. With all “switches” turned on, the Model predicts how much river water will leave Colorado for Kansas during a given month. Id., at 234-235. To obtain a figure representing an unlawful depletion (or lawful accretion) under the Compact, the Model subtracts from this figure (the actual flow) a number representing a hypothetical prediction of how much water would have flowed into Kansas had Colorado not dug and operated post-1949 wells. The Model obtains this prediction through a computer rerun with the Model’s “post-1949 well” switch turned off. Ibid. The final figure is then adjusted to reflect depletions to usable, as opposed to total, flow. App. to Second Report 37.

Not surprisingly, the Model’s ability to calculate depletions has proved highly controversial, leading to many Model modifications during this litigation. See, e.g., 2 First Report 236-240 (describing Colorado’s objections to the original Model). The Special Master has recommended use of the Model together with a 10-year measurement period to determine the amounts of any future depletions. Fourth Report 139. That is to say, a determination of whether Colorado owes Kansas water in Year 11 will be made by taking the Model’s total result for Years 1-10, for year 12 by the Model’s total result for Years 2-11, and so forth. Id., at 117; App. to Fourth Report 86, Exh. 14. Kansas takes exception to the 10-year measurement period.

Kansas seeks a measurement period of one year. In support, Kansas points to Compact Art. V-E(5), 63 Stat. 148, which says that there “shall be no allowance or accumulation of credits or debits for or against either State.” (Internal quotation marks omitted.) Kansas argues that a 10-year period averages out oversupply and undersupply during the interim years, with the likely effect of awarding Colorado a “credit” in dry years for oversupply in wet years. Kansas adds that Art. IV-D, 63 Stat. 147, forbids Colorado to deplete the river water’s “availability for use.” (Internal quotation marks omitted.) Kansas says that the 10-year measurement period in effect frees Colorado from the obligation to compensate Kansas for years (within the 10-year period) when overpumping may have made water “unavailable” for Kansas’ use. (Internal quotation marks omitted.) Kansas also notes that the parties and the Special Master have used a 1-year measuring period in this litigation for purposes of calculating past damages. See Exceptions and Brief for Plaintiff 37-40, 43-44.

Like the Special Master, we are not persuaded by Kansas’ arguments. The literal words of the Compact are not determinative. The Compact’s language essentially forbids offsetting debits with “credits,” but it does not define the length of time over which a “credit” is measured. Any period of measurement inevitably averages interim period flows just as it overlooks interim period lack of water “availability.” Thus annual measurement offsets and overlooks seasonal differences; seasonal measurement, monthly differences; monthly measurement, weekly differences, and so forth.

At the same time, practical considerations favor the Special Master’s measurement approach. Model results over measurement periods of less than 10 years are highly inaccurate. The Special Master found, for example, that the current iteration of the Model, if used to project river diversions (including well pumping) during a single year, produces figures that overpredict actual diversions in some years and underpredict them in others by as much as 22%. Fourth Report 111. Similar inaccuracies plague the Model’s projection of actual river flows. Id., at 112. If projected diversions and flows deviate substantially in this way from actual measured diversions and flows, 1-year estimates of final depletions to usable flow — the figure that determines Kansas’ damages — cannot be accurate. Id., at 115 (“I find that the H-I model is not sufficiently accurate on a short-term basis to be used to determine compact compliance on a monthly or annual basis”). But measured over long periods of time, say, the full 540 months between 1950 and 1994, the Model’s predicted and observed diversions “matched almost perfectly.” Id., at 114. For this, reason, the Master concluded that “[o]nly by using longer term averages do the model simulations more closely match historic data.” Id., at 115. Thus, the 10-year measurement period is needed to ensure Model accuracy.

Nor is Kansas likely to suffer serious harm through use of a 10-year measuring period. That is because Colorado has developed a water replacement program designed to minimize depletions. See Amended Rules and Regulations Governing the Diversion and Use of Tributary Ground Water in the Arkansas River Basin (Use Rules), App. to Fourth Report 36, Exh. 6; Fourth Report 8-13. The program protects both Kansas water users and senior Colorado users by insisting that Colorado users with junior rights (and in particular those who obtain water from post-1949 wells) replace the river water that they use. They must either (1) buy replacement water, say, from the Rockies’ western slope or (2) buy land irrigated under pre-1949 water rights and remove it from cultivation. Id., at 10-13. In practice, junior users belong to one of three associations that conduct these transactions, reporting the details monthly to the Colorado State Engineer’s Office, and receiving replacement “credits,” which they divide among their members. Id., at 13.

Were the replacement program and the H-I Model both to work perfectly, the Model’s net depletion figure, whether determined each month, each year, or each decade, would be zero (that is, there would be no difference between actual flow and what the flow would have been under precompact conditions). Of course, perfection is impossible; and Kansas claims certain defects in the Use Rules. See id., at 27. But operation of the Rules should help to diminish the real amount of any depletion, thereby limiting any negative effect that a 10-year measurement period might have upon Kansas. See id., at 119-120; see also id., at 32. The 1997-1999 results, showing essentially no aggregate depletion, suggest the water replacement program will have this effect. Ibid.

Kansas argues that the Compact’s framers expected annual measurement. And they quote a Colorado Commissioner as recognizing that there would be “‘no carry-over from year to year,’ ” see Exceptions and Brief for Plaintiff 39 (quoting Joint Exhibit 3, pp. 14-84). Assuming, argu-endo, that the framers opposed such carryover, they were likely unaware of the modern difficulties of complex computer modeling. And we believe that those framers, in any event, would have preferred accurate measurement. After all, a “credit” for surplus water that rests upon maccurate measurement is not really a credit at all.

Kansas also points out that earlier in this litigation both parties agreed to the use of annual measurement for purposes of calculating past damages. The parties made that stipulation, however, before the Special Master fully examined the Model’s accuracy. In any event, their previous agreements do not govern this determination.

We overrule Kansas’ exception.

> HH

As we just mentioned, measuring the depletion caused by Colorado’s post-1949 wells involves taking account of Colorado’s water replacement program, which credits Colorado with non-Arkansas water pumped into the Arkansas and with Arkansas water not used because farmers have removed from cultivation lands previously irrigated under pre-1949 water rights. The Special Master has recommended that “the final amounts of Replacement Plan credits to be applied toward Colorado’s Compact obligations shall be the amounts determined by the Colorado Water Court, and any appeals therefrom.” Fourth Report 138, ¶ 9. Kansas takes exception to this recommendation.

Kansas points out that the Colorado Water Court is a state court. It says that a “'State cannot be its own ultimate judge in a controversy with a sister State,’ ” Exceptions and Brief for Plaintiff 45-46 (quoting West Virginia ex rel. Dyer v. Sims, 341 U. S. 22, 28 (1951)), and that this Court must “ 'pass upon every question essential’ ” to resolving the dispute, Exceptions and Brief for Plaintiff 46 (quoting Oklahoma v. New Mexico, 501 U. S. 221, 241 (1991), in turn quoting Kentucky v. Indiana, 281 U. S. 163, 176-177 (1930)). Kansas believes that the Special Master’s recommendation violates these well-established principles.

Kansas’ objection founders, however, upon additional language in the Master’s full recommendation. The recommendation adds:

“This is not to say, however, that the Colorado Water Courts are empowered to make a final determination on any matter essential to compact compliance at the State-line, or that Colorado’s reliance on such Water Court actions will necessarily satisfy its compact obligations.... All replacement credits, no matter how determined, are subject to the right of Kansas to seek relief under the Court’s original jurisdiction [as set forth in] Section VIII.” Fourth Report 138-139, ¶ 9.

In the cross-referenced Section VIII, the Special Master makes clear that Colorado’s replacement plan rules affect the rights, not only of Kansas water users, but also of Colorado senior water users; that both groups of water users have similar litigation incentives; and that permitting the Colorado Water Court initially to consider challenges to credit allocations will help prevent inconsistent determinations. Id., at 93-95.

In our view, the Special Master’s full recommendation will help to avoid the potential conflict he mentioned. It also adequately preserves Kansas’ rights to contest any adverse Water Court determination. We overrule Kansas’ exception.

V

The Special Master found that Colorado complied with the Compact for. the period 1997-1999. Kansas takes exception on the ground that the Special Master used a measurement period “greater than one year.” Exceptions and Brief for Plaintiff 47. Kansas concedes that its objection rests upon its claim that the Special Master cannot use “an accounting period longer than one year.” Ibid. Having found against Kansas on that matter, supra, at 100-103, we must overrule this exception.

VI

At the end of its brief, Kansas lists 15 disputed issues that the Special Master has not yet decided. It groups them into three categories:

1. “Disputed H-I Model Calibration Issues” (“[cjalibration procedures, parameters and criteria,” “[cjanal capacities,” “altered diversion records,” “statistical outliers,” “Sisson-Stubbs water right” representation);
2. “Disputed 1997-1999 Accounting Issues” (“[d]ry-up acreage,” “Sisson-Stubbs credit,” “winter water book-overs” credit);
3. “Disputed Future Compliance Issues” (“[d]ry-up acreage monitoring,” “[d]ry-up credits” and external source “return flow obligations,” credit beyond “precom-pact uses,” “[s]pecial waters monitoring,” winter water release credit timing, “[o]ffset [a]ccount” accounting procedures, “consumptive use credit and return flow obligations”). Exceptions and Brief for Plaintiff 48-49.

Kansas takes exception to the Special Master’s refusal to make recommendations on these issues now. It points out that we cannot leave unanswered important questions “ ‘essential’” to our “‘determination of a controversy’” between the States. Id., at 49 (quoting Oklahoma v. New Mexico, supra, at 241). And Kansas asks us to require the Special Master to decide them.

As the Special Master found, however, there are good reasons not to decide these issues immediately. There is no need to resolve most of the issues in the second category. They involve challenges to the accuracy of the figures used to determine whether Colorado depleted the river between 1997 and 1999. The Special Master concluded that Colorado was in compliance during 1997-1999, in the process relying upon Kansas’ own figures. Fourth Report 30-31. As far as we can tell from the briefs, these issues are mostly moot.

The passage of time will produce more accurate resolution of disputes in the first and third categories (and any of those in the second that arise again in the future). The parties will learn more about matters relevant to their resolution, namely, the H-I Model’s strengths, weaknesses, and methods of monitoring and measurement. That is why the Special Master recommendéd that we retain jurisdiction over this case and permit him to take up lingering issues at a future date. Id., at 135-136,139. We accept that recommendation and overrule Kansas’ objection.

The Special Master also recommended that experts for the two parties confer, e. g., id., at 91-92, and he expressed the hope that expert discussion, negotiation, and, if necessary, binding arbitration would lead to resolution of any remaining disputes. Id., at 135-136. We express that hope as well.

VII

For these reasons, we overrule all Kansas’ exceptions. We accept the Special Master’s recommendations and recommit the ease to the Special Master for preparation of a decree consistent with this opinion.

It is so ordered.

Justice Thomas,

concurring in part and concurring in the judgment.

I join the Court’s opinion with the exception of Part II, which concerns whether prejudgment interest should begin accruing in 1985 only on damages thereafter arising (post-1985 damages) or also on damages then owing (pre-1985 damages). As Justice O’Connor explained in Kansas v. Colorado, 533 U. S. 1 (2001) (Kansas III), neither the Arkansas River Compact itself nor the common law at the time of the compact’s formation allows Kansas to recover any prejudgment interest. See id., at 21-25 (opinion, joined by Scalia and Thomas, JJ., dissenting in part). The Court did not adopt that view in Kansas III, but neither did it adopt the now-familiar rule that Kansas should be made whole with an award of prejudgment interest spanning the duration of Colorado’s breach, from 1950 to the present. See, e. g., Milwaukee v. Cement Div., National Gypsum Co., 515 U. S. 189, 195-196, and n. 7 (1995); West Virginia v. United States, 479 U. S. 305, 310-311, n. 2 (1987).

The Court instead crafted what it viewed as an equitable compromise, designed to apply sui generis to these States and their particular dispute, in which prejudgment interest would begin to accrue in 1985. See Kansas III, supra, at 14-16. Its compromise left open the door to the present litigation, for saying when prejudgment interest began to accrue did not answer on what the interest was accruing. The Court therefore must again decide what is too little or too much compensation for Colorado’s depletion of the Arkansas. That weighing is as unnecessary now as it was before. Kansas is not entitled to prejudgment interest, and its exception seeks only to compound the windfall it received in Kansas III. I therefore agree with the Court that Kansas’ second exception to the Special Master’s Report should be overruled.

Justice Stevens,

concurring in part and dissenting in part.

With the exception of Part II, I join the Court’s opinion. In dissenting from Part II, I adhere to the views that we expressed in Kansas v. Colorado, 533 U. S. 1, 13-16 (2001) (Kansas III). In Kansas III, in a compromise that was required in order to issue a judgment of the Court, we accepted the views of The Chief Justice and Justice Kennedy that prejudgment interest should run from 1985, the date the complaint was filed. Ibid. Like today’s majority, I adhere to the judgment reflecting that compromise. Unlike the majority, however, I believe that prejudgment interest should run, starting in 1985, on all damages that accrued after Colorado “knew or should have known that it was violating” its compact with Kansas — i. e., from 1969. Id., at 15, n. 5. Such a result best respects the reasoning behind our conclusion in Kansas III that prejudgment interest is an appropriate component of the award of damages.

In Kansas III, recognizing that a monetary award does not fully compensate for an injury unless it includes an interest component, we affirmed the Special Master’s determination that the unliquidated nature of Kansas’ claim did not by itself bar an award of prejudgment interest. Id., at 14. Nevertheless, equitable concerns persuaded a majority of the Court to overrule the Special Master’s determination that prejudgment interest should begin to run in 1969, the date on which Colorado first knew, or should have known, that it was violating the Arkansas River Compact. Although we did not explicitly discuss the point in our opinion, we also agreed with the Special Master’s decision to exclude from the principal amount on which interest would run any damages that had accrued prior to 1969.

The methodology that led to that conclusion was the Master’s appraisal of the equities — in his judgment, interest should not be imposed on the portion of the damages award that was attributable to relatively innocent conduct that occurred before 1969. See Report 106-107 (“The general lack of knowledge in the early years about pumping in Colorado and its impacts along the Arkansas River served to protect Kansas during the liability phase of the case against a claim of laches. The same degree of fairness, I believe, should now relieve Colorado of the obligation to pay full interest rates on damages from depletions during 1950-68 period . . But the Master did find that Colorado was required to pay interest on damages that occurred between 1969 and 1985. See ibid.; see also Brief for United States in Opposition to the Exceptions óf Kansas and Colorado in Kansas III, O. T. 2000, No. 105, Orig., p. 27 (“For the period from 1969 to the date of judgment, the Master recommended that Kansas be awarded prejudgment interest”). Our opinion did not reject that portion of his judgment, and did not contain any suggestion that he had erred in that respect. See 533 U. S., at 12, 14. The happenstance that we selected, as a compromise, the date the complaint was filed as the date on which interest should begin to accrue should have no bearing on the principal amount of damages that gave rise to the interest obligation. Thus, I believe that the Special Master’s Fourth Report erred in its conclusion that we meant to limit the principal amount of damages to those that occurred after 1985.

Surely if this were an ordinary tort case involving a single harm-causing event, an award of prejudgment interest would apply to the. entire damages recovery, not just to the portion that resulted from events occurring after interest began to accrue. See Funkhouser v. J. B. Preston Co., 290 U. S. 163, 168 (1933). Indeed, were this an ordinary case, we would no doubt have awarded prejudgment interest in the entire amount that Kansas requested in Kansas III. This, however, is a unique case in which unusual equities necessitated a compromise designed to resolve a dispute between two States. Thus, I agree with the majority that the Special Master was correct in rejecting Kansas’ argument that the principal on which interest should run should be “the nominal damages occurring from 1950 through 1984.” App. to Fourth Report 15.

However, the fact that Kansas’ request represents too large a measure of damages does not convince me that Kansas is entitled to no interest for damages prior to 1985. Nothing in our Kansas III opinion compels such a result. In my view, the proper measure of damages on which Colorado owes Kansas interest is the entire amount attributable to the time that Colorado knew, or should have known, that it was violating the compact. That date is 1969 — the date that the Special Master initially chose and that we implicitly accepted as appropriate in Kansas III. Choosing 1969 as the initial date for the damages period not only has the benefit of respecting our affirmation of the methodology in the Special Master’s Third Report, it also results in a total damages sum that is less than the $38 million the Special Master originally awarded.

Accordingly, I would sustain Kansas’ second objection to the Special Master’s Report, but only insofar as it applies to post-1968 damages.

        Kansas III was predated by Kansas v. Colorado, 514 U. S. 673 (1995), and Kansas v. Colorado, 522 U. S. 1073 (1998).

       Kansas had objected to the Master’s refusal to award interest on all damages accruing after 1950. See Brief for Plaintiff in Kansas III, O. T. 2000, No. 105, Orig., p. 25, n. 8. Although we did not discuss Kansas’ exception to the Special Master’s determination regarding the total amount of damages on which interest would run, we overruled the objection and thereby approved the Master’s selection of the period after 1968 as the appropriate measure of damages on which interest should be paid. See Kansas III, 533 U. S. 1, 14 (2001); see also Third Report of Special Master 106-107 (hereinafter Report) (explaining that Colorado’s awareness of its breach was central to the determination that interest should run on post-1968 damages). Today, the Court explains why it would be inequitable to give Kansas the relief that would be the equivalent of sustaining an objection that we overruled three years ago, but does not explain why we should not accept the Special Master’s original determination that all post-1968 damages should bear interest.


source: Caselaw Access Project

author: Justice Souter

license: Public Domain

text:
    KP PERMANENT MAKE-UP, INC. v. LASTING IMPRESSION I, INC., et al.
    No. 03-409.
    Argued October 5, 2004
    Decided December 8, 2004

      Soutee, J., delivered the opinion of the Court, in which Rehnquist, C. J., and Stevens, O’Connor, Kennedy, Thomas, and Ginsburg, JJ., joined, in which Scalia, J., joined as to all but footnotes 4 and 5, and in which Breyer, J., joined as to all but footnote 6.

      Michael Machat argued the cause and filed briefs for petitioner.

      Patricia A. Millett argued the cause for the United States as amicus curiae urging reversal. With her on the brief were former Solicitor General Olson, Assistant Attorney General Keisler, Deputy Solicitor General Hungar, Anthony J. Steinmeyer, Anthony A. Yang, John M. Whealan, Cynthia C. Lynch, and Nancy C. Slutter.

      Beth S. Brinkmann argued the cause for respondents. With her on the brief were Charles C. H. Wu, Mark H. Cheung, Drew S. Days III, Edward W. Gray, Jr., Seth M. Galanter, and J. Thomas McCarthy.

       Briefs of amici curiae urging reversal were filed for the American Intellectual Property Law Association by Michael P. Boudett, Denise W DeFranco, and Rick D. Nydegger; for the Private Label Manufacturers Association by Artlmr M. Handler; and for Malla Pollack et al. by Ms. Pollack, pro se.

        Robert A. Long, Jr., filed a brief for the Society of Permanent Cosmetic Professionals et al. as amici curiae urging affirmance.

        William D. Raman, Theodore H. Davis, Jr., and Olivia Maria Baratía filed a brief for the International Trademark Association as amicus curiae.

   Justice Souter

delivered the opinion of the Court.

The question here is whether a party raising the statutory affirmative defense of fair use to a claim of trademark infringement, 15 U. S. C. § 1115(b)(4), has a burden to negate any likelihood that the practice complained of will confuse consumers about the origin of the goods or services affected. We hold it does not.

I

Each party to this case sells permanent makeup, a mixture of pigment and liquid for injection under the skin to camouflage injuries and modify nature's dispensations, and each has used some version of the term “micro color” (as one word or two, singular or plural) in marketing and selling its product. Petitioner KP Permanent Make-Up, Inc., claims to have used the single-word version since 1990 or 1991 on advertising flyers and since 1991 on pigment bottles. Respondents Lasting Impression I, Inc., and its licensee, MCN International, Inc. (Lasting, for simplicity), deny that KP began using the term that early, but we accept KP’s allegation as true for present purposes; the District and Appeals Courts took it to be so, and the disputed facts do not matter to our resolution of the issue. In 1992, Lasting applied to the United States Patent and Trademark Office (PTO) under 15 U. S. C. § 1051 for registration of a trademark consisting of the words “Micro Colors” in white letters separated by a green bar within a black square. The PTO registered the mark to Lasting in 1993, and in 1999 the registration became incontestable. § 1065.

It was also in 1999 that KP produced a 10-page advertising brochure using “microcolor” in a large, stylized typeface, provoking Lasting to demand that KP stop using the term. Instead, KP sued Lasting in the Central District of California, seeking, on more than one ground, a declaratory judgment that its language infringed no such exclusive right as Lasting claimed. Lasting counterclaimed, alleging, among other things, that KP had infringed Lasting’s “Micro Colors” trademark.

KP sought summary judgment on the infringement counterclaim, based on the statutory affirmative defense of fair use, 15 U. S. C. § 1115(b)(4). After finding that Lasting had conceded that KP used the term only to describe its goods and not as a mark, the District Court held that KP was acting fairly and in good faith because undisputed facts showed that KP had employed the term “microcolor” continuously from a time before Lasting adopted the two-word, plural variant as a mark. Without enquiring whether the practice was likely to cause confusion, the court concluded that KP had made out its affirmative defense under § 1115(b)(4) and entered summary judgment for KP on Lasting’s infringement claim. See Case No. SA CV 00-276-GLT (EEx) (May 16, 2001), pp. 8-9, App. to Pet. for Cert. 29a-30a.

On appeal, 328 F. 3d 1061 (2003), the Court of Appeals for the Ninth Circuit thought it was error for the District Court to have addressed the fair use defense without delving into the matter of possible confusion on the part of consumers about the origin of KP’s goods. The reviewing court took the view that no use could be recognized as fair where any consumer confusion was probable, and although the court did not pointedly address the burden of proof, it appears to have placed it on KP to show absence of consumer confusion. Id, at 1072 (“Therefore, KP can only benefit from the fair use defense if there is no likelihood of confusion between KP’s use of the term ‘micro color’ and Lasting’s mark”). Since it found there were disputed material facts relevant under the Circuit’s eight-factor test for assessing the likelihood of confusion, it reversed the summary judgment and remanded the case.

We granted KP’s petition for certiorari, 540 U. S. 1099 (2004), to address a disagreement among the Courts of Appeals on the significance of likely confusion for a fair use defense to a trademark infringement claim, and the obligation of a party defending on that ground to show that its use is unlikely to cause consumer confusion. Compare 328 F. 3d, at 1072 (likelihood of confusion bars the fair use defense); PACCAR Inc. v. TeleScan Technologies, L. L. C., 319 F. 3d 243, 256 (CA6 2003) (“[A] finding of a likelihood of confusion forecloses a fair use defense”); and Zatarains, Inc. v. Oak Grove Smokehouse, Inc., 698 F. 2d 786, 796 (CA5 1983) (alleged infringers were free to use words contained in a trademark “in their ordinary, descriptive sense, so long as such use [did] not tend to confuse customers as to the source of the goods”), with Cosmetically Sealed Industries, Inc. v. Chesebrough-Pond’s USA Co., 125 F. 3d 28, 30-31 (CA2 1997) (the fair use defense may succeed even if there is likelihood of confusion); Shakespeare Co. v. Silstar Corp. of Am., Inc., 110 F. 3d 234, 243 (CA4 1997) (“[A] determination of likely confusion [does not] preclud[e] considering the fairness of use”); Sunmark, Inc. v. Ocean Spray Cranberries, Inc., 64 F. 3d 1055, 1059 (CA7 1995) (finding that likelihood of confusion did not preclude the fair use defense). We now vacate the judgment of the Court of Appeals.

II

A

The Trademark Act of 1946, known for its principal proponent as the Lanham Act, 60 Stat. 427, as amended, 15 U. S. C. § 1051 et seq., provides the user of a trade or service mark with the opportunity to register it with the PTO, §§1051, 1053. If the registrant then satisfies further conditions including continuous use for five consecutive years, “the right... to use such registered mark in commerce” to designate the origin of the goods specified in the registration “shall be incontestable” outside certain listed exceptions. § 1065.

The holder of a registered mark (incontestable or not) has a civil action against anyone employing an imitation of it in commerce when “such use is likely to cause confusion, or to cause mistake, or to deceive.” § 1114(l)(a). Although an incontestable registration is “conclusive evidence ... of the registrant’s exclusive right to use the . . . mark in commerce,” § 1115(b), the plaintiff’s success is still subject to “proof of infringement as defined in section 1114,” ibid. And that, as just noted, requires a showing that the defendant’s actual practice is likely to produce confusion in the minds of consumers about the origin of the goods or services in question. See Two Pesos, Inc. v. Taco Cabana, Inc., 505 U. S. 763, 780 (1992) (Stevens, J., concurring); Lone Star Steakhouse & Saloon, Inc. v. Alpha of Virginia, Inc., 43 F. 3d 922, 935 (CA4 1995); Restatement (Third) of Unfair Competition §21, Comment a (1995) (hereinafter Restatement). This plaintiff’s burden has to be kept in mind when reading the relevant portion of the further provision for an affirmative defense of fair use, available to a party whose

“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 . . . .” § 1115(b)(4).

Two points are evident. Section 1115(b) places a burden of proving likelihood of confusion (that is, infringement) on the party charging infringement even when relying on an incontestable registration. And Congress said nothing about likelihood of confusion in setting out the elements of the fair use defense in § 1115(b)(4).

Starting from these textual fixed points, it takes a long stretch to claim that a defense of fair use entails any burden to negate confusion. It is just not plausible that Congress would have used the descriptive phrase “likely to cause confusion, or to cause mistake, or to deceive” in §1114 to describe the requirement that a markholder show likelihood of consumer confusion, but would have relied on the phrase “used fairly” in § 1115(b)(4) in a fit of terse drafting meant to place a defendant under a burden to negate confusion. “ '[Wjhere Congress includes particular language in one section of a statute but omits it in another section of the same Act, it is generally presumed that Congress acts intentionally and purposely in the disparate inclusion or exclusion.’ ” Russello v. United States, 464 U. S. 16, 23 (1983) (quoting United States v. Wong Kim Bo, 472 F. 2d 720, 722 (CA5 1972); alteration in original).

Nor do we find much force in Lasting’s suggestion that “used fairly” in § 1115(b)(4) is an oblique incorporation of a likelihood-of-confusion test developed in the common law of unfair competition. Lasting is certainly correct that some unfair competition cases would stress that use of a term by another in conducting its trade went too far in sowing confusion, and would either enjoin the use or order the defendant to include a disclaimer. See, e. g., Baglin v. Cusenier Co., 221 U. S. 580, 602 (1911) (“[W]e are unable to escape the conclusion that such use, in the manner shown, was to serve the purpose of simulation . . .”); Herring-Hall-Marvin Safe Co. v. Hall’s Safe Co., 208 U. S. 554, 559 (1908) (“[T]he rights of the two parties have been reconciled by allowing the use, provided that an explanation is attached”). But the common law of unfair competition also tolerated some degree of confusion from a descriptive use of words contained in another person’s trademark. See, e. g., William R. Warner & Co. v. Eli Lilly & Co., 265 U. S. 526, 528 (1924) (as to plaintiff’s trademark claim, “[t]he use of a similar name by another to truthfully describe his own product does not constitute a legal or moral wrong, even if its effect be to cause the public to mistake the origin or ownership of the product”); Canal Co. v. Clark, 13 Wall. 311, 327 (1872) (“Purchasers may be mistaken, but they are not deceived by false representations, and equity will not enjoin against telling the truth”); see also 3 L. Altman, Callmann on Unfair Competition, Trademarks and Monopolies § 18:2, pp. 18-8 to 18-9, n. 1 (4th ed. 2004) (citing cases). While these cases are consistent with taking account of the likelihood of consumer confusion as one consideration in deciding whether a use is fair, see Part II-B, infra, they do not stand for the proposition that an assessment of confusion alone may be dispositive. Certainly one cannot get out of them any defense burden to negate it entirely.

Finally, a look at the typical course of litigation in an infringement action points up the incoherence of placing a burden to show nonconfusion on a defendant. If a plaintiff succeeds in making out a prima facie case of trademark infringement, including the element of likelihood of consumer confusion, the defendant may offer rebutting evidence to undercut the force of the plaintiff's evidence on this (or any) element, or raise an affirmative defense to bar relief even if the prima facie case is sound, or do both. But it would make no sense to give the defendant a defense of showing affirmatively that the plaintiff cannot succeed in proving some element (like confusion); all the defendant needs to do is to leave the factfinder unpersuaded that the plaintiff has carried its own burden on that point. A defendant has no need of a court’s true belief when agnosticism will do. Put another way, it is only when a plaintiff has shown likely confusion by a preponderance of the evidence that a defendant could have any need of an affirmative defense, but under Lasting’s theory the defense would be foreclosed in such a case. “[I]t defies logic to argue that a defense may not be asserted in the only situation where it even becomes relevant.” Shakespeare Co. v. Silstar Corp., 110 F. 3d, at 243. Nor would it make sense to provide an affirmative defense of no confusion plus good faith, when merely rebutting the plaintiff’s case on confusion would entitle the defendant to judgment, good faith or not.

Lasting tries to extenuate the anomaly of this conception of the affirmative defense by arguing that the oddity reflects the “vestigial” character of the fair use defense as a historical matter. Tr. of Oral Arg. 39. Lasting argues that, because it was only in 1988 that Congress added the express provision that an incontestable markholder’s right to exclude is “subject to proof of infringement,” Trademark Law Revision Act of 1988, § 128(b)(1), 102 Stat. 3944, there was no requirement prior to 1988 that a markholder prove likelihood of confusion. Before 1988, the argument goes, it was sensible to get at the issue of likely confusion by requiring a defendant to prove its absence when defending on the ground of fair use. When the 1988 Act saddled the markholder with the obligation to prove confusion likely, § 1115(b), the revision simply failed to relieve the fair use defendant of the suddenly strange burden to prove absence of the very confusion that a plaintiff had a new burden to show in the first place.

But the explanation does not work. It is not merely that it would be highly suspect in leaving the claimed element of § 1115(b)(4) redundant and pointless. Hibbs v. Winn, 542 U. S. 88, 101 (2004) (noting “rule against superfluities” in statutory construction). The main problem of the argument is its false premise: Lasting’s assumption that holders of incontestable marks had no need to prove likelihood of confusion prior to 1988 is wrong. See, e. g., Beer Nuts, Inc. v. Clover Club Foods Co., 805 F. 2d 920, 924-925 (CA10 1986) (requiring proof of likelihood of confusion in action by holder of incontestable mark); United States Jaycees v. Philadelphia Jaycees, 639 F. 2d 134, 137, n. 3 (CA3 1981) (“[incontestability [does not] mak[e] unnecessary a showing of likelihood of confusion . . .”); 5 J. McCarthy, Trademarks and Unfair Competition §32:154, p. 32-247 (4th ed. 2004) (“Before the 1988 Trademark Law Revision Act, the majority of courts held that while incontestability grants a conclusive presumption of the ‘exclusive right to use’ the registered mark, this did not relieve the registrant of proving likelihood of confusion”).

B

Since the burden of proving likelihood of confusion rests with the plaintiff, and the fair use defendant has no freestanding need to show confusion unlikely, it follows (contrary to the Court of Appeals’s view) that some possibility of consumer confusion must be compatible with fair use, and so it is. The common law’s tolerance of a certain degree of confusion on the part of consumers followed from the very fact that in cases like this one an originally descriptive term was selected to be used as a mark, not to mention the undesirability of allowing anyone to obtain a complete monopoly on use of a descriptive term simply by grabbing it first. Canal Co. v. Clark, 13 Wall., at 323-324, 327. The Lanham Act adopts a similar leniency, there being no indication that the statute was meant to deprive commercial speakers of the ordinary utility of descriptive words. “If any confusion results, that is a risk the plaintiff accepted when it decided to identify its product with a mark that uses a well known descriptive phrase.” Cosmetically Sealed Industries, Inc. v. Chesebrough-Pond’s USA Co., 125 F. 3d, at 30. See also Park ’N Fly, Inc. v. Dollar Park & Fly, Inc., 469 U. S. 189, 201 (1985) (noting safeguards in Lanham Act to prevent commercial monopolization of language); Car-Freshner Corp. v. S. C. Johnson & Son, Inc., 70 F. 3d 267, 269 (CA2 1995) (noting importance of “protect[ing] the right of society at large to use words or images in their primary descriptive sense”). This right to describe is the reason that descriptive terms qualify for registration as trademarks only after taking on secondary meaning as “distinctive of the applicant’s goods,” 15 U. S. C. § 1052(f), with the registrant getting an exclusive right not in the original, descriptive sense, but only in the secondary one associated with the markholder’s goods, 2 McCarthy, supra, §11:45, p. 11-90 (“The only aspect of the mark which is given legal protection is that penumbra or fringe of secondary meaning which surrounds the old descriptive word”).

While we thus recognize that mere risk of confusion will not rule out fair use, we think it would be improvident to go further in this case, for deciding anything more would take us beyond the Ninth Circuit’s consideration of the subject. It suffices to realize that our holding that fair use can occur along with some degree of confusion does not foreclose the relevance of the extent of any likely consumer confusion in assessing whether a defendant’s use is objectively fair. Two Courts of Appeals have found it relevant to consider such scope, and commentators and amici here have urged us to say that the degree of likely consumer confusion bears not only on the fairness of using a term, but even on the further question whether an originally descriptive term has become so identified as a mark that a defendant’s use of it cannot realistically be called descriptive. See Shakespeare Co. v. Silstar Corp., 110 F. 3d, at 243 (“[T]o the degree that confusion is likely, a use is less likely to be found fair...” (emphasis deleted)); Sunmark, Inc. v. Ocean Spray Cranberries, Inc., 64 F. 3d, at 1059; Restatement §28; Brief for American Intellectual Property Law Association as Amicus Curiae 13-18; Brief for Private Label Manufacturers Association as Amicus Curiae 16-17; Brief for Society of Permanent Cosmetic Professionals et al. as Amici Curiae 8-11.

Since we do not rule out the pertinence of the degree of consumer confusion under the fair use defense, we likewise do not pass upon the position of the United States, as ami-cus, that the “used fairly” requirement in § 1115(b)(4) demands only that the descriptive term describe the goods accurately. Tr. of Oral Arg. 17. Accuracy of course has to be a- consideration in assessing fair use, but the proceedings in this case so far raise no occasion to evaluate some other concerns that courts might pick as relevant, quite apart from attention to confusion. The Restatement raises possibilities like commercial justification and the strength of the plaintiff’s mark. Restatement § 28. As to them, it is enough to say here that the door is not closed.

III

In sum, a plaintiff claiming infringement of an incontestable, mark must show likelihood of consumer confusion as part of the prima facie case, 15 U. S. C. § 1115(b), while the defendant has no independent burden to negate the likelihood of any confusion in raising the affirmative defense that a term is used descriptively, not as a mark, fairly, and in good faith, § 1115(b)(4).

Because we read the Court of Appeals as requiring KP to shoulder a burden on the issue of confusion, we vacate the judgment and remand the case for further proceedings consistent with this opinion.

It is so ordered.

       Justice Scalia joins all but footnotes 4 and 5 of this opinion. Justice Breyer joins all but footnote 6.

       We note that in its brief to the Court of Appeals, Lasting appeal’s to have conceded KP’s use of “microcolor” in the early 1990’s. Appellants’ Opening Brief in No. 01-56055 (CA9), p. 8.

       A trademark may be “any word, name, symbol, or device, or any combination thereof. . . used by a person ... to identify and distinguish his or her goods ... from those manufactured and sold by others and to indicate the source of the goods, even if that source is unknown.” 15 U. S. C. § 1127.

       We summarize the proceedings in this litigation only as they are relevant to the question before us. The District Court’s findings as to the generic or descriptive nature of the term “micro color” and any secondary meaning that term has acquired by any of the parties, see Case No. SA CV 00-276-GLT (EEx) (CD Cal., May 16, 2001), pp. 3-5, 5-8, are not before us. Nor are the Court of Appeals’s holdings on these issues. See 328 F. 3d 1061, 1068-1071 (CA9 2003). Nor do we address the Court of Appeals’s discussion of “nominative fair use.” Id., at 1071-1072.

       Not only that, but the failure to say anything about a defendant’s burden on this point was almost certainly not an oversight, not after the House Subcommittee on Trademarks declined to forward a proposal to provide expressly as an element of the defense that a descriptive use be ‘“[un]likely to deceive the public.’” Hearings on H. R. 102 et al. before the Subcommittee on Trade-Marks of the House Committee on Patents, 77th Cong., 1st Sess., 167-168 (1941) (hereinafter Hearings) (testimony of Prof. Milton Handler).

       See also Hearings 72 (testimony of Wallace Martin, Chairman, American Bar Association Committee on Trade-Mark Legislation) (“Everybody has got a right to the use of the English language and has got a right to assume that nobody íb going to take that English language away from him”).

       The record indicates that on remand the courts should direct their attention in particular to certain factual issues bearing on the fair use defense, properly applied. The District Court said that Lasting’s motion for summary adjudication conceded that KP used “microcolor” descriptively and not as a mark. Case No. SA CV 00-276-GLT (EEx), at 8, App. to Pet. for Cert. 29a. We think it is arguable that Lasting made those concessions only as to KP’s use of “microcolor” on bottles and flyers in the early 1990’s, not as to the stylized version of “microcolor” that appeared in KP’s 1999 brochure. See Opposition to Motion for Summary Judgment/ Adjudication in Case No. SA CV 00-276-GLT (EEx) (CD Cal.), pp. 18-19; Appellants’ Opening Brief in No. 01-56055 (CA9), pp. 31-32. We also note that the fair use analysis' of KP’s employment of the stylized version of “microcolor” on its brochure may differ from that of its use of the term on the bottles and flyers.