Pizza and the Edge of the Trademark Universe

When is a Flavor/Taste Trademark Possible?

NANOCHEM SOLUTIONS, INC., Plaintiff, v. GLOBAL GREEN PRODUCTS, LLC, and LARRY P. KOSKAN - Patent Infringement, Lanham Act, Trademark, Trade dress,

Plaintiff NanoChem Solutions, Inc ("NC") brings this action against defendants Global Green Products, LLC ("GGP") and Larry P. Koskan for patent infringement arising under 35 U.S.C. § 271 (Counts I through V), unfair competition under the Lanham Act, 15 U.S.C. § 1125(a) (Count VI), and unfair competition under Illinois law (Count VII).Presently pending are cross motions for summary judgment as to Counts VI and VII. Also pending defendants' motion in limine to bar evidence of damages. Discovery was completed and closed. Defendants' motion for partial summary judgment as to certain patent claims was previously denied. See Nanochem Solutions, Inc. v. Global Green Prods., LLC, 2012 WL 5048064 (N.D. Ill. Oct. 16, 2012). A claim construction ruling has also been issued. See Nanochem Solutions, Inc. v. Global Green Prods., LLC, 2013 WL 393302 (N.D. Ill. Jan. 29, 2013).

Previously, plaintiff had represented it would also seek patent damages based on a reasonable royalty, but is now relying only on lost profits. Plaintiff has now disclosed its damages calculation and that calculation is limited to lost profits. Plaintiff will be limited to seeking damages consistent with that disclosure. Even if there was a violation of Rule 26(a) and 26(e)(1)(A) because the supplemental disclosure was not timely, the calculation will not be excluded if any delay was substantially justified or harmless. Fed. R. Civ. P. 37(c)(1); Smith v. Ill. Ass'n of Sch. Bd., 2012 WL 895426 *2 (S.D. Ill. March 15, 2012); Compak Cos., LLC v. Johnson, 2011 WL 1654269 *17 (N.D. Ill. April 28, 2011).

Plaintiff contends a Lanham Act claim is shown even if A-5D is not a distinctive mark because of long use and, alternatively, that A-5D is a distinctive mark. Accordingly, it contends it need not show secondary meaning or commercial injury. The parties also have disagreements regarding what the evidence shows regarding certain of GGP's compounding of A-5D. It is unnecessary to determine whether either side's factual contentions regarding GGP's conduct are supported by undisputed facts or instead involve genuine factual disputes that must be resolved differently for each side's summary judgment motion. In order to succeed on its reverse passing off contentions, plaintiff must show that A-5D is a distinctive mark or has secondary meaning. Undisputed facts support that neither is true.

In Bretford Mfg., Inc. v. Smith Sys. Mfg. Corp., 419 F.3d 576, 579-80 (7th Cir. 2005),the Seventh Circuit held that the Lanham Act reverse passing off claims in that case required proof of inherent distinctiveness or secondary meaning. Plaintiff attempts to distinguish Bretford on the ground that it involves trade dress, not a trademark. However, the discussion in Bretford is not limited to trade dress. 

A later Seventh Circuit case involving reverse confusion supports that the distinctiveness requirement applies for reverse passing off trademark claims as well. See Custom Vehicles, Inc. v. Forest River, Inc., 476 F.3d 483-85 (7th Cir. 2007); see also Peaceable Planet, Inc. v. Ty, Inc.,362 F.3d 986 (7th Cir. 2004). At least one district court case from another circuit has held in the alternative that the distinctiveness requirement applies to reverse passing off trademark claims. See Impreglon, Inc. v. Newco Enterprises, Inc., 508 F. Supp. 2d 1222, 1241 n.18 (N.D. Ga. 2007).

Plaintiff also cites Web Printing Controls Co., Inc. v. Oxy-Dry Corp., 906 F.2d 1202 (7th Cir. 1990). While not listing distinctiveness as an element of a reverse passing off claim, this case also does not expressly address that issue. Unlike the present case,Web Printing involved a registered trademark that had been used for years, see id. at 1203, which is presumed to be distinctive or to have secondary meaning. See Custom Vehicles, supra; Timelines, Inc. v. Facebook, Inc., 2013 WL 1340598 *9 (N.D. Ill. April 1, 2013).

The parties shall promptly meet and make a concerted effort to settle the remaining issues in this case. Absent a resolution by settlement, the final pretrial order is due on the date set forth below. The pretrial order is to be filed electronically with a paper judge's copy brought to court on the date set forth below.

IT IS THEREFORE ORDERED AS FOLLOWS:

Defendants' motion in limine to bar damage evidence [192] is granted in part and denied in part. Plaintiff's damages are limited to lost profits.

Plaintiff's motion for summary judgment [186] is denied. Defendants' cross motion for summary judgment [195] is granted. Counts VI and VII of the Second Amended Complaint are dismissed.

On October 17, 2013 at 2:00 p.m., the parties shall submit a judge's copy of a final pretrial order in full compliance with Local Rule 16.1 and Local Rule Form 16.1.1, including trial briefs, proposed voir dire questions, motions in limine with supporting briefs, and proposed jury instructions.

NANOCHEM SOLUTIONS, INC., Plaintiff,

v.

GLOBAL GREEN PRODUCTS, LLC, and LARRY P. KOSKAN, Defendants,

No. 10 C 5686.

United States District Court, N.D. Illinois, Eastern Division.

September 10, 2013. http://scholar.google.com/scholar_case?case=15602572089520346789&q=Facebook&hl=en&as_sdt=4,14,112,127,268,269,270,271,272,314,315,331,332,333,334,335,377,378&as_ylo=2013

10 (and a Half) Tips for Dealing With Trademark Issues

From Law.com an excellent summation of IP issues posted today.

http://www.law.com/jsp/pa/PubArticlePA.jsp?id=1202622018446&back=law

PROSPERITY BANCSHARES, INC., and PROSPERITY BANK v. TOWN AND COUNTRY FINANCIAL CORPORATION and TOWN AND COUNTRY BANK - Trademark, Intellectual Property

This matter came before the Court on a Motion for Preliminary Injunction ("Motion") filed by Plaintiffs, Prosperity Bancshares, Inc., and Prosperity Bank (collectively "Prosperity". Prosperity sought a preliminary injunction prohibiting Defendants, Town and Country Financial Corporation and Town and Country Bank (collectively "Town and Country"), from using Prosperity's registered trademarks, "Prosperity Bancshares, Inc." and "Prosperity Bank." (collectively the "Prosperity Marks"). Both parties presented evidence and called witnesses. Prosperity's services and products include checking accounts, savings accounts, money market accounts, IRA accounts, loans, trust services, debit cards, credit cards, and online banking. One hundred and forty-thousand Prosperity customers nationwide use the online banking services. Tr. These customers have about $6 million in loans and $2 million in deposits. Any Prosperity customer can use the online services at an Internet accessible location via Prosperity's registered domain name www.prosperitybanktx.com.

On May 18, 2012, Defendants Town and Country opened the bank's newest branch location in Quincy, Illinois, and named the branch Peoples Prosperity Bank. Illinois and Federal banking regulations require that Town and Country always identify Peoples Prosperity Bank in Quincy as a division of Town and Country. Tr. 83. The Quincy branch store-front sign reads Peoples Prosperity Bank A Division of Town and Country Bank. Town and Country registered the domain name www.ourprosperity.com with an Internet registrar and maintains a Facebook page at www.facebook.com/townandcountrybank.com that references the 2012 opening of Peoples Prosperity Bank in Quincy.

Internet users who enter the www.ourprosperity.com domain name are automatically redirected to Town and Country's home page at www.townandcountrybank.com.

Prosperity did not demonstrater a likelihood for success on the merits in this trademark infringement action against Town and Country for Town and Country's use of the Quincy branch bank name Peoples Prosperity Bank a division of Town and Country or the domain name www.ourprosperity.com. 

The Motion for Preliminary Injunction was DENIED 

PROSPERITY BANCSHARES, INC., and PROSPERITY BANK, Plaintiffs,

v.

TOWN AND COUNTRY FINANCIAL CORPORATION and TOWN ANDCOUNTRY BANK, Defendants.

No. 12-cv-03179. February 4, 2013.

United States District Court, C.D. Illinois, Springfield Division.

http://scholar.google.com/scholar_case?case=6433111256963993752&q=Facebook&hl=en&as_sdt=4,14,112,127,268,269,270,271,272,314,315,331,332,333,334,335,377,378&as_ylo=2013, last visited 10/09/2013

Wrigley Jr. Co. v. Swerve IP, LLC - Trademark, IP Issues

Chewing gum has been with us for many centuries. People worldwide have chewed on natural materials for hundreds of years. Some of these materials include thickened resin and latex from certain types of trees, various sweet grasses, leaves, grains and waxes.

The William Wrigley Jr. Company is a company headquartered in GIC (Global Innovation Center)the in Goose Island, Chicago, Illinois.^[1] The company was founded on April 1, 1891, originally selling products such as soap and baking powder. In 1892,William Wrigley, Jr., the company's founder, began packaging chewing gum with each can of baking powder. The chewing gum eventually became more popular than the baking powder itself and Wrigley's reoriented the company to produce the popular chewing gum.

The company currently sells its products in more than 180 countries and districts and maintains 140 factories in various countries and districts, including the United States, Mexico, Australia, the United Kingdom, Canada, Spain, New Zealand, the Philippines, Czech Republic, Germany, South Africa, Argentina, Tanzania, Tunisia, Somalia, North Korea (the only US enterprise there^{[citation needed]}) France, Kenya, China (including Taiwan), India, Poland, and Russia.

The Wrigley building is clad in glazed terra-cotta, which provides its gleaming white façade. It is one of Chicago's most cherished landmarks. On occasion, the entire building is hand washed to preserve the terra cotta. At night, the building is brightly lit with floodlights. The area has come a long way since the pre_fire days of the SANDS, a tawdry area of taverns and houses of ill repute, located just a stone's throw away on the other side of what is now Michigan Ave. History abounds here since the South Side of this site also housed Fort Dearborn, the first American outpost built in 1803 beside the Chicago River in the days when Potawatomi and Fox Indians ruled the marshy swamp area.  Fort Dearborn was located at what is now the intersection of Wacker Drive and Michigan Avenue in the Loop community area of Chicago at the foot of the Magnificent Mile. Part of the fort outline is marked by plaques and a line embedded in the sidewalk and road near the Michigan Avenue Bridge and Wacker Drive. A few boards from the old fort were retained and are now in the Chicago History Museum in Lincoln Park.

Swerve IP holds a word mark (SWERVE), the name of its "all-natural" erythirtol-based non-sugar sweetener. It has used the mark since 2001. The United States Patent and Trademark office (the "USPTO") registered it in September 2009. (Swerve IP acquired the rights to the mark via assignment in 2011, evidently when the sweetener part of the business changed hands.) That registration covers "natural sweetener" in International Class 030 (which includes a large number of food and candy products).

SWERVE sweetener is also used in the commercial manufacture of some food products, including diet pralines, but Swerve IP hopes to expand into more mainstream markets, including chewing gum. The sweetener is promoted via social media sites such as Facebook and Twitter.

Wrigley manufactures and sells the popular "5" brand of chewing gum. There are a dozen different flavors, one of which is called "Swerve" — because, Wrigley claims, it changes from a "tangy" to a "sweet tropical" flavor when chewed. The gum is not "all-natural" but is sugar-free, and is marked as containing natural and artificial flavors. Wrigley markets 5 Gum as an extreme sensory experience, targeting customers in their teens and twenties. 5 Gum is sold mainly in grocery and convenience stores, though it is also available through Amazon.com.

In October 2010, Wrigley learned of Swerve IP's mark. That month, it applied to register "swerve" in International Class 030, covering "chewing gum." Swerve IP opposed the registration. By all appearances, the opposition was still pending before the Trademark Trial and Appeal Board (the "TTAB") at the time of this hearing.

In late 2011, Swerve IP sent Wrigley a cease-and-desist demand regarding the Swerve mark. Wrigley filed a declaratory judgment action before this Court regarding its use of the Swerve term. Swerve IP moved for a preliminary injunction.

"A party seeking a preliminary injunction is required to demonstrate a likelihood of success on the merits, that it has no adequate remedy at law, and that it will suffer irreparable harm if the relief is not granted." Promatek Industries, Ltd. v. Equitrac Corp., 300 F.3d 808, 811 (7th Cir. 2002).

the Court discusses the evidence in only general terms.

Preliminary Injunction

The Court noted that a party seeking a preliminary junction must demonstrate a likelihood of success on the merits. Promatek, 300 F.3d at 811. The parties appear to agree that irreparable injury may be presumed from trademark infringement. The Seventh Circuit arguably cast doubt on that proposition in a recent copyright case. Flava Works, Inc. v. Gunter, ___ F.3d ___, 2012 WL 3124826, at *1 (7th Cir. 2012) (citing eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 392-93(2006)). But cf. Am. Taxi Dispatch, Inc. v. Am. Metro Taxi & Limo Co., 582 F.Supp.2d 999, 1005 (N.D. Ill. 2008) (applying the presumption and citing, inter alia, eBay.).

I Likelihood of Success on the Merits

At this initial phase, the Court need only find that Swerve IP has a non-negligible likelihood of success on the merits. Ty, Inc. v. Jones Grp., Inc., 237 F.3d 891, 896-97 (7th Cir. 2001). To prevail on the merits, Swerve IP must show that: (1) it has a protectable trademark, and (2) there is a likelihood of confusion. Id. at 897. The Court found that this is a "reverse confusion" case — one in which a junior user uses its size and market power to overwhelm a senior, but smaller, mark user. See Custom Vehicles, Inc. v. Forest River, Inc., 476 F.3d 481, 484 (7th Cir. 2007).

a. Mark is entitled to Protection

"The law recognizes five categories of trademarks, in ascending order of distinctiveness: generic, descriptive, suggestive, arbitrary, and fanciful." Packman v. Chicago Tribune Co., 267 F.3d 628, 638 (7th Cir. 2001). 

b. Likelihood of Confusion

"Seven factors comprise the likelihood of confusion analysis: (1) similarity between the marks in appearance and suggestion; (2) similarity of the products; (3) area and manner of concurrent use; (4) degree of care likely to be exercised by consumers; (5) strength of the plaintiff's mark; (6) actual confusion; and (7) intent of the defendant to "palm off" his product as that of another." Packman v. Chicago Tribune Co., 267 F.3d 628, 643 (7th Cir. 2001).

i. Similarity Between the Marks

Swerve IP argued that the word marks are identical. Wrigley argues that, as presented in the marketplace, they are quite different: Swerve IP uses "swerve," in orange script, as a brand name accompanied by the image of a multicolored bird. 5 Swerve Gum, it notes, uses a different font and sleek, black, futuristic packaging with a "pop" of color (mostly orange). 

ii. Product Similarity

The Court found that the key issue here as to product similarity is whether the products are related enough that the public might attribute them (in source or affiliation) to a single producer. Ty, Inc., 237 F.3d at 900. The parties focused extensively on their customers' demographics; although that information is not an intuitive fit with this factor, other courts have considered it, and the Court will do likewise. See Pathfinder Commc'ns Corp. v. Midwest Commc'ns Co., 593 F.Supp. 281, 286 (D.C. Ind. 1984).

iii. Area and Manner of Concurrent Use

Several factors are relevant to whether to products are related in terms of use, promotion, sales or distribution such that their area and manner of concurrent use supports a finding of confusion, including: their geographical distribution areas, any competition between them, whether they are sold in the same section and type of store, and whether they are sold through the same marketing channels. See Ty, Inc., 237 F.3d at 900.

iv. Degree of Care Exercised by Consumers

The Court noted that the level of care exercised by consumers is a significant factor in assessing the likelihood of confusion. Rust Env't & Infrastructure, Inc. v. Teunissen, 131 F.3d 1210, 1217 (7th Cir. 1997). Although in forward confusion cases both parties' customers are relevant, see CAE, Inc. v. Clean Air Eng'g, Inc., 267 F.3d 660, 682-83 (7th Cir. 2001),the Court finds persuasive those cases which find the senior user's customers more important in reverse confusion cases. Matrix Motor Co., Inc. v. Toyota Jidosha Kabushiki Kaisha, 290 F.Supp.2d 1083, 1095 (C.D. Cal. 2003). The less expensive the product, the less care consumers are expected to use. CAE, Inc., 267 F.3d at 682-83.

v. Strength of Complainant's mark

The Court noted that The "strength" of a trademark refers to the mark's distinctiveness and ability or tendency to identify the goods sold under that mark as originating from a particular source. Sands, Taylor & Wood Co., 978 F.2d at 959. In reverse confusion cases, the focus is on the junior use of the mark. Id. If the marks are identical and the products closely related, this factor matters little, but this Court had already found that the marks are presented differently to the public. The Court has also found, as noted, that the mark is arbitrary as to the sweetener, and suggestive as to the gum.

vi. Actual Confusion

There appears to be no dispute that there is no evidence of actual confusion. Although actual confusion is not necessary, see Id. at 960, this factor weighs in favor of Wrigley.

vii. Intent

Intent is irrelevant in a reverse confusion case. Id. (Whether Wrigley knowingly ignored Swerve IP's trademark is relevant — just in balancing the harms. Ideal Indus. Inc. v. Gardner Bender, Inc., 612 F.2d 1018, 1026 (7th Cir. 1979)).

2. No Adequate Remedy at Law/Irreparable Harm

The Court found that Swerve IP also must prove that it has no adequate remedy at law, and would suffer irreparable harm absent an injunction. Promatek, 300 F.3d at 813. The parties agreed that there is a presumption of irreparable damages in trademark infringement cases. The debate was whether Wrigley overcame that presumption.

3. Harm to Wrigley

Wrigley contended that it would be irreparably harmed both financially and intangibly by an injunction. It contends that its immediate financial loss would exceed $2 million, including packaged inventory, "raw materials, lost sales, and rebranding costs." Furthermore, it contended, its relationships with distributors and retailers, including its share of shelf space, would irreparably suffer.

Wrigley's Motions to Strike and for a Hearing were granted in part and denied in part. Swerve IP's Motion for a Preliminary Injunction was continued, pending a hearing on the issues identified herein.

WM. WRIGLEY JR. COMPANY, Plaintiff and Case Counter-Defendant, Hon. Harry D. Leinenweber

v.

SWERVE IP, LLC, Defendant and Counter-Claimant.
No. 11 C 9274

United States District Court, N.D. Illinois, Eastern Division.

September 28, 2012. http://scholar.google.com/scholar_case?case=5826833193876238359&q=MySpace+OR+Twitter&hl=en&as_sdt=4,14,112,127,268,269,270,271,272,314,315,331,332,333,334,335,377,378&as_ylo=2012&as_yhi=2013

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