False Designation of Origin

March 31, 2014

Indiana Trademark Litigation: Agler Sues Westheimer Over Use of Stratotone Mark

Fort Wayne, Indiana – Indiana trademark attorneys for Darryl Agler, doing business as The Stratotone Guitar Company of Fort Wayne, Indiana, filed a lawsuit in the Northern District of Indiana alleging that Westheimer Corporation of Northbrook, Illinois infringed the trademark “STRATOTONE” (the “Stratotone mark”), Trademark Registration No. 3,986,754 which has been issued by the U.S. Patent and Trademark Office (“USPTO”). Counterfeiting, unfair competition, and false designation of origin arising under the Lanham Act, 15 U.S.C. § 1051 et seq., and the statutes and common law of the State of Indiana have also been alleged.

Agler custom manufactures guitars and sells them across the United States. Each of Agler’s guitars is hand crafted from the wood of a customer’s choosing and features vintage hardware. Agler currently accepts orders for his guitars on his website at www.stratotoneguitar.com. He also displays and sells his guitars, which sell at retail for $1,250 or more, at vintage guitar shows across the nation. Angler asserts that, since at least as early as January of 2007, his marketing and promotions in connection with his guitars have included the Stratotone Mark.

Agler claims a right to exclude others’ use of the “Stratotone” mark in connection with guitars based on, inter alia, ownership of trademark rights to the mark “Stratotone” conferred by U.S. Reg. No. 3,986,754 (“‘754 Registration”). The ‘754 Registration was issued by the USPTO in 2011 as a result of a 2006 application for the Stratotone mark in association with “musical instruments, namely, guitars.”

According to the complaint, at the National Association of Music Merchants (“NAMM”) show in 2010, Westheimer offered and sold cheaper guitars using the Stratatone mark. Agler states that he spoke to Westheimer personnel twice at this show, notifying them that Westheimer’s products were infringing the Stratotone mark. Agler alleges that he was unable to sell any of his guitars at the NAMM show that year.

Agler indicates that, since the 2010 NAMM show, Westheimer has flooded the market with lower quality, cheaper guitars that bear the Stratotone mark. These guitars retail between $199.00 and $399.00. Agler contends that Westheimer’s “Stratotone” guitars have destroyed the market for Agler’s more expensive Stratotone guitars.

On April 25, 2013, Westheimer filed a petition to cancel the ‘754 Registration (the “Cancellation Petition”) with the Trademark Trial and Appeal Board. The Cancellation Petition is currently pending.

In the complaint, filed by Indiana intellectual property lawyers for Agler, the following counts are alleged:

• Count I: Federal Unfair Competition and False Designation of Origin
• Count II: Federal Trademark Infringement
• Count III: Federal Trademark Counterfeiting
• Count IV: Common Law Unfair Competition and Trademark Infringement
• Count V: Unjust Enrichment
• Count VI: Conversion
• Count VII: Deception
• Count VIII: Indiana Crime Victim’s Relief Act

Agler asks the court for injunctive relief; an accounting of damages; the surrender by Westheimer of items featuring the Stratotone mark; damages, including treble damages; and attorney’s fees.

Practice Tip: Indiana Code §§ 35-43-4-3 and 35-43-5-3(a)(6) are criminal statutes, claimed in the complaint in conjunction with an attempt to parlay the accusation into an award for damages, costs and attorneys’ fees. The Indiana Court of Appeals has discussed “theft” and “conversion” as they pertain to takings of intellectual property in several recent cases (see, for example, here and here) and has made it clear that criminal statutes often apply differently to an unlawful taking of intellectual property.

February 20, 2014

Noble Roman’s Sues Another Indiana Franchisee Alleging Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – An Indiana trademark attorney for Noble Roman’s, Inc. of Indianapolis, Indiana sued in the Southern District of Indiana alleging that B & MP, LLC (which was dissolved in 2011) and Leslie Perdriau of Apple River, Illinois (collectively, “B & MP”) infringed the trademark Noble Roman’s, Registration No. 987,069, as well as the trademark, The Better Pizza People, Registration No. 1,920,428. Noble Roman’s also lists a design mark, Registration No. 1,682,308 in its complaint. All of the marks have been registered by the U.S. Trademark Office.

Noble Roman’s is in the business of franchising the operation of Noble Roman’s pizza franchises that feature pizza, breadsticks, and other related food items to various franchisees throughout the world. Noble Roman’s has used its trademarks, among them “Noble Roman’s” and “The Better Pizza People,” registered in 1974 and 1995, respectively, in commerce in connection with marketing, identifying, and promoting its pizza franchises.

On or about March 16, 2010, Noble Roman’s and B & MP entered into two franchise agreements. Under the terms of the agreements, B & MP became a franchisee of Noble Roman’s licensed and authorized to sell “Noble Roman’s” and “Tuscano’s” branded food products using Noble Roman’s intellectual property assets. These agreements included terms relating to the accurate reporting of sales and timely payment of franchise and other fees.

B & MP is accused of failing to pay royalties as required under the agreement and of misreporting sales, among other things. Noble Roman’s contends that B & MP purposely, intentionally and knowingly misreported its sales to Noble Roman’s for the purpose of avoiding payment of franchise fees and/or royalties which were due.

Noble Roman’s also states that B & MP used the Noble Roman’s trademarks in connection with the sale of non-Noble Roman’s pizza and other menu items and that such use of the trademarks was without the authorization or consent of Noble Roman’s. Those acts were asserted to constitute trademark infringement, in violation of 15 U.S.C. § 1114(1), as well as a false designation of origin in violation of 15 U.S.C. § 1125.

Although the complaint lists two Defendants, Noble Roman’s states that Defendant B & MP was involuntarily dissolved in 2011 and that Defendant Leslie Perdriau succeeded to its obligations.

The complaint, filed by an Indiana trademark lawyer, lists the following:

• Count One (Trademark Infringement)
• Count One [sic] (Breach of Contract)
• Count Two (Fraud)

Noble Roman’s asks for judgment in its favor in amount to be proven at trial, together with interest, punitive damages, costs of collection and reasonable attorneys’ fees.

Practice Tip: Noble Roman’s has been particularly aggressive in enforcing franchise agreements. Since 2007, it has also filed the following suits in the Southern District of Indiana:

September 5, 2012 – NOBLE ROMAN’S, INC. v. VILLAGE PANTRY

March 17, 2011 – NOBLE ROMAN’S, INC. v. FINDLAY TIFFIN OIL, LLC and AYMAN MAGDADDI

January 27, 2011 – NOBLE ROMAN’S INC. et al. v. BRABHAM OIL COMPANY and BRABHAM OIL COMPANY

October 9, 2009 – NOBLE ROMAN’S, INC. v. CITY CENTER FOOD CORP., INC.

August 31, 2009 – NOBLE ROMAN’S INC. v. W.J. INTERNATIONAL GROUP, LLC

July 17, 2009 – NOBLE ROMAN’S, INC. v. MARDAN, INC.

July 8, 2009 – NOBLE ROMAN’S, INC. v. RENTON WILLIAMS

April 21, 2009 – NOBLE ROMAN’S, INC. v. RICHARD A. GOMES and RRCM FOODS, INC.

April 2, 2009 – NOBLE ROMAN’S, INC. v. KANDAKAR ALAM

February 17, 2009 – NOBLE ROMAN’S, INC. v. EXPRESS LANE, INC.

February 10, 2009 – NOBLE ROMAN’S, INC. v. JJP&L, LLC

November 6, 2008 – NOBLE ROMAN’S, INC. v. PARDIS & ASSOCIATES, INC.

October 24, 2008 – NOBLE ROMAN’S, INC. v DELTA PROPERTY MANAGEMENT LLC, ZACK BROTHERS TRUCK STOP, LLC and STANDARD PETROLEUM CORP.

October 6, 2008 – NOBLE ROMAN’S INC. v. JAY’S GAS LLC

April 9, 2008 – NOBLE ROMAN’S, INC. v. SHAHRAM RAHIMIAN

March 17, 2008 – NOBLE ROMAN’S, INC. v. MEDALLION CONVENIENCE STORES, INC.

December 20, 2007 – NOBLE ROMAN’S, INC. v. MICHAEL J. BRUNSWICK, LAURIE BRUNSWICK, and M&L RESTAURANTS, LLC

September 17, 2007 – NOBLE ROMAN’S, INC. v. THE FRENCH BAGUETTE, LLC et al.

July 26, 2007 – NOBLE ROMAN’S, INC. v. MR. RON’S, L.C.

July 19, 2007 – NOBLE ROMAN’S INC. v. BAUER BUILT, INC. et al.

February 10, 2014

Swag Merchandising and Musical Group Devo Sue for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – An Indiana trademark attorney for Swag Merchandising, Inc. and Devo Inc., both of California, sued in Hamilton Superior Court alleging that Your Fantasy Warehouse, Inc. d/b/a T.V. Store Online and Fred Hajjar, both of Commerce Township, Michigan, infringed Devo’s Trademarks, Registration Nos. 3161662 and 3167516, which have been registered by the U.S. Trademark Office. The case has been removed from Indiana state court to the Southern District of Indiana.

Swag claims that it owns the exclusive right to license the various trademarks, copyrights and individual and collective rights of publicity of the musical group Devo. The group is best known for the song “Whip It,” which hit number 14 on the Billboard chart in 1980. Swag indicates that it licenses the Devo intellectual property to third parties around the globe.

T.V. Store Online is in the business of manufacturing, marketing and distributing apparel and memorabilia featuring classic and current television programming, movies and/or music. T.V. Store Online and Hajjar have been accused of manufacturing, producing, marketing, advertising and/or retailing a product known as “Energy Dome Hats.” Plaintiffs assert that these Energy Dome Hats are commonly associated with Devo but have not been licensed by Plaintiffs to Defendants. Plaintiffs further claim that consumers coming into contact with Defendants’ product would “immediately recognize the same as being associated with, sponsored by and/or endorsed by” the ’80s group.

In the complaint, filed by an Indiana trademark attorney, Plaintiffs assert the following:

• I: Violation of 15 U.S.C. §1125(a) of the Lanham Act
• II: Trademark Infringement – 15 U.S.C. §1114 and Common Law
• III: Counterfeiting
• IV: Dilution – 15 U.S.C. §1125(c) and New York General Business Law §360-1
• V: Common Law Unfair Competition
• VI: Statutory Right of Publicity [NB: under Indiana law]
• VII: Right of Publicity Infringement Under California Civil Code §3344
• VIII: Common Law Right of Publicity
• IX: Conversion [NB: under Indiana law]
• X: Deception [NB: under Indiana law]
• XI: Indiana Crime Victims Act

Plaintiffs ask for an injunction; the surrender of infringing materials; damages, including treble damages; costs and fees. An Indiana intellectual property lawyer for Defendants removed the case to federal court, although he noted that the removal was not a concession that the Southern District of Indiana was the proper venue for the California Plaintiffs or the Michigan Defendants.

Practice Tip:

This is at least the third case filed by Theodore Minch about which we have blogged. In at least two prior cases, LeeWay Media Group, LLC v. Laurence Joachim et al. and Leon Isaac Kennedy v. GoDaddy et al., Mr. Minch has filed in an Indiana court despite none of the parties having any connection to Indiana.

It can be surmised that perhaps the choice of Indiana as a forum might have been driven by an attempt to increase damages. I.C. §§ 35-43-4-3 and 35-43-5-3(a)(6) are criminal statutes, claimed in the complaint in conjunction with an attempt to parlay the accusation into an award for damages, costs and attorneys’ fees. The Indiana Court of Appeals has discussed “theft” and “conversion” as they pertain to takings of intellectual property in several recent cases (see, for example, here and here) and has made it clear that criminal statutes often apply differently to an unlawful taking of intellectual property.

January 13, 2014

Contour Hardening Sues Vanair for Patent and Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Indiana patent and trademark attorneys for Contour Hardening, Inc. of Indianapolis, Indiana sued seeking injunctive and monetary relief in the Southern District of Indiana. Contour Hardening alleges that Vanair Manufacturing, Inc. of Michigan City, Indiana has infringed the trademark “REAL POWER”, Trademark Registration No. 3,124,014, as well as Contour Hardening’s patented “Vehicle Mounted Electrical Generator System.” The invention is covered by Patent Nos. 6,979,913 and 7,057,303, which have been issued by the U.S. Patent Office.

In this lawsuit, Plaintiff Contour Hardening contends that Defendant Vanair has violated, and continues to violate, inter alia, the patent laws of the United States, 35 U.S.C. §§271 and 281- 285, as well as the Federal Trademark Act by infringing Contour Hardening’s two patents, U.S. Patent Nos. 6,979,913 and 7,057,303 (collectively, the “Contour Patents”), and infringing Contour Hardening’s REAL POWER trademark by using Vanair’s allegedly similar ROAD POWER trademark.

Contour Hardening is a developer and provider of Power Take-Off (“PTO”) driven generator systems for vehicles ranging from Class 2 pickup trucks (e.g., full-size trucks) to larger Class 8 Heavy Duty trucks (e.g., tractor trailer trucks). It states that these systems have been utilized in municipal, fire-rescue, construction, healthcare, mining, farming and other applications.

Plaintiff asserts that, sometime around 2007, Vanair first began offering vehicle-mounted AC-generator systems that infringe one or more of the claims of the Contour Patents. Vanair is accused of having received actual knowledge that it was infringing the Contour Patents at least as early December 17, 2012, when an Indiana patent and trademark lawyer for Contour Hardening sent to Vanair a letter providing it with actual notice of the Contour Patents and expressing “concerns regarding possible infringement.” The letter requested that Vanair “evaluate [its] activities relative to these two (2) patents and provide a written response as to when any infringing activities will cease.” According to Contour Hardening, Vanair did not respond this letter.

In addition to its allegations of patent infringement, Contour Hardening asserts trademark infringement. Contour Hardening indicates that it is the owner of United States Registration No. 3,124,014 for the trademark REAL POWER for providing AC generators. It claims that, since at least 2004 and continuously to date, it has adopted and used in interstate commerce the trademark REAL POWER in connection with its PTO-driven AC-generator systems and related operations and that the trademark has become distinctive to consumers in the vehicle-mounted AC-generator industry.

Contour Hardening contends that Vanair offers the allegedly infringing products under the trademark ROAD POWER with knowledge of Contour Hardening’s REAL POWER trademark. It further asserts that the nameplates, labels or other graphic displays that Vanair uses are confusingly similar to Contour Hardening’s trademark and that Vanair’s use of the ROAD POWER trademark is likely to cause confusion or mistake or deception of consumers as to the source of origin of Vanair’s goods or services. Contour Hardening further claims that Vanair’s activities have been willful, deliberate and intentional, have caused a likelihood of confusion, and have been done with the intent to trade upon Contour Hardening’s goodwill in the trademark REAL POWER.

In the complaint, Indiana patent and trademark attorneys assert the following on Contour Hardening’s behalf:

• Count I – Infringement of U.S. Patent 6,979,913
• Count II – Infringement of U.S. Patent 7,057,303
• Count III – Trademark Infringement
• Count IV – False Designation of Origin

Contour Hardening asks the court for a judgment of infringement of the Contour Patents; a judgment of infringement of Contour Hardening’s REAL POWER trademark; a permanent injunction prohibiting further infringement; an order that all infringing devices be delivered and destroyed; damages, including treble damages; costs and expenses; an order declaring that the case is exceptional and an award of attorney’s fees pursuant to such a finding.

Practice Tip: A 2006 opinion from the Federal Circuit, AERO Products International, Inc., et al. v. INTEX Recreation Corp., et al., addressed double recovery in cases where both patent infringement and trademark infringement are found. The Federal Circuit held that the trial court’s award of both $2.95 million for patent infringement – which was doubled to $5.9 million pursuant to a finding of willful patent infringement – and $1 million for trademark infringement was impermissible as a double recovery for the “same injury.” The court vacated the $1 million award for trademark damages stating, “even though damages are claimed based upon separate statutes or causes of action, when the claims arise out of the same set of operative facts, as is the case here, there may be only one recovery.”

December 16, 2013

Cummins Alleges Trademark Infringement and Counterfeiting in Lawsuit

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Cummins Inc. of Columbus, Indiana has sued in the Southern District of Indiana alleging counterfeiting, trademark infringement and trademark dilution by T’Shirt Factory of Greenwood, Indiana; Freedom Custom Z of Bloomington, Indiana; Shamir Harutyunyan of Panama City Beach, Florida and Doe Defendants 1 – 10. Defendants are accused of infringing various trademarks, including those protected by Trademark Registration Nos. 4,103,161 and 1,090,272, which have been registered by the U.S. Patent and Trademark Office.

Cummins was founded nearly a century ago and is a global power leader with complementary business units that design, manufacture, distribute and service engines and related technologies, including fuel systems, controls, air handling, filtration, emission solutions and electrical power generation systems. Cummins employs approximately 46,000 people worldwide and serves customers in approximately 190 countries.

Defendants include T’Shirt Factory and Shamir Harutyunyan, who is alleged to be an owner, agent, and/or officer of T’Shirt Factory. Cummins claims that Harutyunyan was personally aware of, and authorized and/or participated in, the wrongful conduct alleged in Cummins’ complaint. Freedom Custom Z is also named as a Defendant. Its business purportedly includes the sale of t-shirts, sweatshirts and other apparel upon which logos have been printed or affixed. Doe Defendants 1 – 10, the identities of whom are currently unknown, have also been accused of the illegal acts alleged.

Cummins states that it owns and maintains hundreds of trademark registrations worldwide covering a broad spectrum of goods and services. Among those is Trademark Registration No. 4,126,680, which covers the following goods: “Men’s and women’s clothing, namely, sweatshirts, hooded sweatshirts, aprons, shirts, sport shirts, jackets, t-shirts, polo shirts, baseball caps and hats, ski caps, fleece caps, headbands, scarves, quilted vests, coveralls, leather jackets, t-shirts for toddlers and children” in International Class 25.

Cummins also asserts that it owns Trademark Registration No. 4,103,161. It indicates that this trademark registration covers the following goods: “Men’s and women’s clothing, namely, sweatshirts, hooded sweatshirts, aprons, shirts, sport shirts, jackets, t-shirts, polo shirts, baseball caps and hats, ski caps, fleece caps, headbands, scarves, quilted vests, coveralls, leather jackets, t-shirts for toddlers and children” in International Class 25. Cummins also states that it owns Trademark Registration No. 4,305,797, registered for similar goods.

Finally, Cummins claims Trademark Registration Nos. 579,346; 1,090,272 and 1,124,765, which also relate to the Cummins Mark, as its intellectual property.

In December 2013, Cummins employees observed apparel bearing the Cummins Marks offered for sale at kiosks located in the College Mall in Bloomington, Indiana; in the Greenwood Park Mall in Greenwood, Indiana; and in the Castleton Mall in Indianapolis, Indiana.

Trademark lawyers for Cummins have sued in the Southern District of Indiana. Cummins accuses Defendants of having acted intentionally, willfully and maliciously. It makes the following claims in its complaint:

• Count I: Trademark Infringement Under Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)
• Count II: Trademark Dilution Under Section 43(c) of the Lanham Act, 15 U.S.C. § 1125(c)
• Count III: Trademark Counterfeiting Under Section 32(1) of the Lanham Act, 15 U.S.C. § 1114(1)

Cummins asks 1) for a temporary restraining order allowing inspection and seizure of the accused goods as well as enjoining Defendants from, inter alia, manufacturing or selling items bearing counterfeit Cummins Marks; 2) for preliminary and permanent injunctions prohibiting Defendants from, inter alia, manufacturing or selling items bearing counterfeit Cummins Marks; and 3) that the court order the destruction of all unauthorized goods.

It also asks the court to find that the Defendants 1) have infringed Cummins’ trademarks in violation of 15 U.S.C. § 1114; 2) have created a false designation of origin and false representation of association in violation of 15 U.S.C. § 1125(a); 3) have diluted Cummins’ famous trademarks in violation of 15 U.S.C. § 1125(c) and 4) have willfully infringed.

Cummins asks for Defendants’ profits from the sales of the infringing and counterfeit goods bearing the Cummins Marks; treble actual damages, costs, reasonable attorneys’ fees as well as pre-judgment and post-judgment interest.

Practice Tip: Repercussions for counterfeiting are not limited to the damages that can be awarded for civil wrongdoing. Increasingly, defendants who engage in counterfeiting, especially counterfeiting on a large scale or during high-profile events, can find themselves facing criminal charges (see, e.g., an arrest made on allegations of counterfeiting during Super Bowl XLVI) in addition to being sued by the owner of the trademark.

December 11, 2013

Project Management Academy Sues Former Instructor for Misappropriation of Trade Secrets

By Overhauser Law Offices, LLC

Indianapolis, Indiana – eCity Market, Inc. d/b/a Project Management Academy (“PMA”) of Lafayette, Indiana has sued Vaughn Scott Burch (“Burch”) and Graywood Consulting Group, Inc. d/b/a Graywood Training Solutions of Leesburg, Virginia (collectively, “Graywood”) alleging infringement of its Project Management Professional examination and certification training. This suit was initially filed in Delaware County Circuit Court No. 4 but was removed to the Southern District of Indiana.

PMA offers preparation courses for the Project Management Institute’s Project Management Professional (“PMP”) examination and certification process. PMA states that Burch was one of its most-trusted PMP course instructors in the Washington, D.C. area and that, in connection with that position, PMA provided him with access to its proprietary manner of conducting its PMP-examination preparation courses. Moreover, PMA claims that it commissioned Burch and Graywood, Burch’s company, to draft and prepare as a “work for hire” certain training modules that would be for PMA’s exclusive use.

PMA alleges that Burch and Graywood are now teaching PMP courses that are in direct competition with PMA. It also contends that Defendants have stolen PMA’s confidential, proprietary and copyrighted materials to further their own course offerings. PMA further indicates that Defendants are violating the non-competition covenants by reproducing PMA’s copyrighted materials and are passing them off as their own. Finally, PMA contends that Defendants are attempting to engage in unfair competition with PMA by publishing student testimonials as if they were from Defendants’ students when, PMA states, the testimonials were actually given by the students of PMA.

An intellectual property lawyer for PMA filed a complaint alleging the following:

• Count I – Breach of Contract
• Count II – Breach of Duty of Loyalty
• Count III – Misappropriation of Trade Secrets
• Count IV – Theft/Conversion
• Count V – Tortious Interference with Prospective Business Relationship and Advantage
• Count VI – Lanham Act Violations
• Count VII – Unfair Competition

PMA asks for preliminary and permanent injunctions; an order requiring the return of all PMA materials; judgment in favor of PMA on the seven counts listed; damages, including treble and punitive damages; attorney’s fees and costs; and interest.

Practice Tip: There has also been a growing trend, perhaps fueled in part by states’ difficulties in paying increasing unemployment benefits, to limit via legislation the enforceability of non-compete agreements. Indiana considers non-compete agreements to be in restraint of trade and, thus, construes them narrowly. Among the states that have considered such limitations are Maryland, New Jersey, Minnesota, Massachusetts and Virginia. However, even in those cases where a non-compete agreement is found to be unenforceable, such a finding will not prevent a party from suing to protect its other rights, such as the intellectual property rights granted under copyright law.

November 25, 2013

Eli Lilly Sues Singpet for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Eli Lilly and Company of Indianapolis, Indiana has filed a trademark infringement lawsuit in the Southern District of Indiana alleging that Sebastian Wiradharma a/k/a Sebastian Singh (“Singh”) and Singpet Pte. Ltd., both of Singapore, infringed the trademark COMFORTIS, Registration Number 3,370,168, which has been registered by the U.S. Trademark Office.

Lilly, through its Elanco Animal Health Division, manufactures, markets and sells pet medicines, including flea-control preparations and treatments for parasitic infestations. It contends that it has made long and continuous of the name and mark “Elanco” in connection with veterinary preparations. It also asserts that it has long used the “Comfortis” mark, which was registered by the U.S. Trademark Office in 2008. Lilly claims that it has sold tens of millions of dollars’ worth of veterinary preparations, pet medicines and related goods and services under the Elanco and Comfortis marks.

Among Lilly’s products is Trifexis, a once-monthly veterinary medication, which contains the veterinary chemicals spinosad and milbemycin oxime. Trifexis is for the prevention of heartworms, fleas and intestinal worms. It is sold in the United States with what Lilly contends to be an inherently distinctive and non-functional trade dress. Trifexis is available only by prescription through licensed veterinarians. Lilly sells a similar product in Australia, with similar trade dress, under the name “Panoramis.”

Defendant Singh, who is allegedly the principal of Singpet, and Singpet do business over the Internet, including via websites at www.singpet.com, www.petcorporate.com, www.fleastuff.com and http://www.ourpetworld.net/home.asp, among others.

Defendants are accused of marketing and selling European and Australian versions of Elanco- and Comfortis-branded pet medicines to customers in the United States. Specifically, Lilly contends that Defendants market “Panoramis (Triflexis)” [sic] on their websites. While the Defendants are apparently based in Singapore, this marketing is allegedly directed at consumers in the United States. Lilly asserts that units designed for sale in markets such as Europe and Australia are neither intended nor authorized for sale in the United States.

Lilly further objects to the Defendants’ purported advertisement of units designed for the Australian and European markets as identical to or interchangeable with the units designed for sale in the United States. It states that that the Elanco-branded “Panoramis” pet medicines are materially different from its Elanco-branded “Trifexis” pet medicines sold in the United States.

Lilly contends that the Elanco- and Comfortis-branded pet medicines are tailored to meet the requirements of different geographic regions and countries to reflect the differences in language, climate, government regulations, units of measure, local addresses and telephone numbers, among other things.

Trademark attorneys for Lilly assert that Defendants are not authorized to use Lilly’s Elanco or Comfortis names and trade dress in connection with the sale of once-monthly spinosad and milbemycin oxime pet medicines outside of Australia. Lilly has sued Defendants, asserting willful infringement of its trademarks. It asserts the following in its complaint:

• First Claim for Relief: Trademark Infringement in Violation of Section 32 of the Lanham Act
• Second Claim for Relief: Unfair Competition in Violation of Section 43(a) of the Lanham Act
• Third Claim for Relief: False Advertising in Violation of Section 43(a) of the Lanham Act
• Fourth Claim for Relief: Unfair Competition in Violation of Indiana Common Law

Lilly asks for preliminary and permanent injunctions; damages, including treble damages; the Defendants to be required to notify all purchasers of the accused products, request the return of the products and refund the price paid; pre- and post-judgment interest and costs of the suit.

Practice Tip:

Lilly is objecting to the so-called “grey market” for its veterinary pharmaceuticals. Prices for drugs can vary considerably between countries, often as a result of government intervention in the market. As a result, a “grey market” – selling a drug intended for use in one country to consumers in another country – can emerge. In this complaint, Lilly has framed its objection to a grey market for its pet-care pharmaceuticals as an intellectual property dispute.

Intellectual property law requires a balancing of competing interests. On the one hand, innovation will be discouraged if inventors, authors and other creators of intellectual property are not allowed to benefit from their labors. Such a problem arises if others are allowed to use creators’ ideas without compensating them (the “free-rider problem”). On the other hand, the public good is promoted by encouraging free competition in the marketplace and easy alienability of property.

Under the first-sale defense to infringement, once a copy of an item protected by intellectual property laws has been sold to a purchaser, the creator of the intellectual property generally may not prevent that purchaser from reselling or otherwise disposing of the item. In patent and copyright law, the first-sale rule in most cases provides an absolute defense against infringement. In patent law, this is also referred to as “patent exhaustion.” As a result, the purchaser of a copy of the work and the owner of the intellectual property rights to that work may become competitors in the marketplace if the purchaser goes to resell a copy of the work.

The first-sale defense is not as broad in a trademark context. Enunciated in 1924 by the U.S. Supreme Court, the general rule for the resale of a trademark item provides that, after a trademark owner has sold a trademarked product, the buyer ordinarily may resell that product under the original mark without incurring any trademark liability. See Prestonettes, Inc. v. Coty, 264 U.S. 359 (1924). However, unlike patent or copyright law, trademark law has as one of its primary goals preventing confusion among potential purchasers. Typically, but not always, such confusion will not exist where a genuine article bearing an authentic trademark is sold. While there is a split among the circuits concerning the extent to which consumer confusion is a relevant factor, some hold that certain types of confusion about a product’s origin cause the first-sale defense to be inapplicable to the resale of a trademarked good. See Au-Tomotive Gold Inc. v. Volkswagen of America, Inc., 603 F.3d 1133, 1134 (9th Cir. 2010).

November 20, 2013

Eli Lilly Sues Pet Supply, Pet Products Net and Graham Nelson for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Eli Lilly and Company of Indianapolis, Indiana (“Lilly”) has filed a trademark infringement lawsuit in the Southern District of Indiana alleging that Graham Nelson, Zoja Pty Ltd. d/b/a Pet Supply International Ltd., and Pet Products Net, all of Australia, infringed the trademark COMFORTIS, Trademark Registration No. 3,370,168, which has been registered by the U.S. Trademark Office.

Lilly, through its Elanco Animal Health Division, manufactures, markets and sells pet medicines, including flea-control preparations and treatments for parasitic infestations. It contends that it has made long and continuous of the name and mark “Elanco” in connection with veterinary preparations. It also asserts that it has long used the “Comfortis” mark, which was registered by the U.S. Trademark Office in 2008. Lilly claims that it has sold tens of millions of dollars’ worth of veterinary preparations, pet medicines and related goods and services under the Elanco and Comfortis marks.

Among Lilly’s products is Trifexis, a once-monthly veterinary medication, which contains the veterinary chemicals spinosad and milbemycin oxime. Trifexis is for the prevention of heartworms, fleas and intestinal worms. It is sold in the United States with what Lilly contends to be an inherently distinctive and non-functional trade dress. Trifexis is available only by prescription through licensed veterinarians. Lilly sells a similar product in Australia, with similar trade dress, under the name “Panoramis.”

Defendants Nelson, Zoja, Pet Supply and Pet Products Net do business over the Internet, including at the website www.bestvaluepetsupplies.com. Among the products listed on their website is “Panoramis aka Trifexis.” While the companies are apparently based in Australia, the website indicates that they ship to the United States.

Lilly has sued Defendants over the sale of Panoramis to the United States. It asserts that units designed for sale in markets such as Europe and Australia are neither intended nor authorized for sale in the United States. Lilly further indicates that the Elanco- and Comfortis-branded pet medicines are tailored to meet the requirements of different geographic regions and countries to reflect the differences in language, climate, government regulations, units of measure, local addresses and telephone numbers, among other things.

Lilly objects to the Defendants’ purported advertisement of units designed for the Australian and European markets as identical to or interchangeable with the units designed for sale in the United States. It states that that the Elanco-branded “Panoramis” pet medicines are materially different from its Elanco-branded “Trifexis” pet medicines sold in the United States.

Trademark attorneys for Lilly assert that Defendants are not authorized to use Lilly’s Elanco or Comfortis names and trade dress in connection with the sale of once-monthly spinosad and milbemycin oxime pet medicines outside of Australia. Lilly has sued Defendants, asserting willful infringement of its trademarks. It asserts the following in its complaint:

• First Claim for Relief: Trademark Infringement in Violation of Section 32 of the Lanham Act
• Second Claim for Relief: Unfair Competition in Violation of Section 43(a) of the Lanham Act
• Third Claim for Relief: False Advertising in Violation of Section 43(a) of the Lanham Act
• Fourth Claim for Relief: Unfair Competition in Violation of Indiana Common Law

Lilly asks for preliminary and permanent injunctions; damages, including treble damages; the Defendants to be required to notify all purchasers of the accused products, request the return of the products and refund the price paid; pre- and post-judgment interest and costs of the suit.

Practice Tip:

Lilly is objecting to the so-called “grey market” for its veterinary pharmaceuticals. Prices for drugs can vary considerably between countries, often as a result of government intervention in the market. As a result, a “grey market” – selling a drug intended for use in one country to consumers in another country – can emerge. In this complaint, Lilly has framed its objection to a grey market for its pet-care pharmaceuticals as an intellectual property dispute.

Intellectual property law requires a balancing of competing interests. On the one hand, innovation will be discouraged if inventors, authors and other creators of intellectual property are not allowed to benefit from their labors. Such a problem arises if others are allowed to use creators’ ideas without compensating them (the “free-rider problem”). On the other hand, the public good is promoted by encouraging free competition in the marketplace and easy alienability of property.

Under the first-sale defense to infringement, once a copy of an item protected by intellectual property laws has been sold to a purchaser, the creator of the intellectual property generally may not prevent that purchaser from reselling or otherwise disposing of the item. In patent and copyright law, the first-sale rule in most cases provides an absolute defense against infringement. In patent law, this is also referred to as “patent exhaustion.” As a result, the purchaser of a copy of the work and the owner of the intellectual property rights to that work may become competitors in the marketplace if the purchaser goes to resell a copy of the work.

The first-sale defense is not as broad in a trademark context. Enunciated in 1924 by the U.S. Supreme Court, the general rule for the resale of a trademark item provides that, after a trademark owner has sold a trademarked product, the buyer ordinarily may resell that product under the original mark without incurring any trademark liability. See Prestonettes, Inc. v. Coty, 264 U.S. 359 (1924). However, unlike patent or copyright law, trademark law has as one of its primary goals preventing confusion among potential purchasers. Typically, but not always, such confusion will not exist where a genuine article bearing an authentic trademark is sold. While there is a split among the circuits concerning the extent to which consumer confusion is a relevant factor, some hold that certain types of confusion about a product’s origin cause the first-sale defense to be inapplicable to the resale of a trademarked good. See Au-Tomotive Gold Inc. v. Volkswagen of America, Inc., 603 F.3d 1133, 1134 (9th Cir. 2010).

November 15, 2013

Ambre Blends Sues doTERRA For Trademark Infringement of “Solace”

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Ambre Blends, LLC of Fishers, Indiana has filed a trademark infringement lawsuit in the Southern District of Indiana alleging that doTERRA, Inc., doTERRA International, LLC, both of Orem, Utah (collectively, “doTERRA”) and Kerry Dodds d/b/a Kerry Essentials of Indianapolis, Indiana (“Kerry”) infringed SOLACE®, Trademark No. 4266473, which has been registered by the U.S. Trademark Office.

In its complaint, Ambre Blends claims to have been producing organic body products since 2001. It offers four fragrances which are designed to be worn by both women and men. Founded in 2008, doTERRA offers essential oils both as single oils and as proprietary essential oil blends via independent product consultants. Both companies claim rights in the mark “Solace” in connection with essential oil products.

Ambre Blends asserts that it has used the Solace mark continuously in commerce since at least as early as February 2007. It holds a federally registered trademark on the mark in connection with “Aromatic preparations, namely, oils, body creams, body sprays, soaps, shower gel; Beauty creams; Body and beauty care cosmetics; Body cream; Body sprays; Essential oils for use in aromatherapy; Essential oils for use in manufacturing of candles, lip balm, shower gel, shampoo, conditioner; Face and body lotions; Non-medicated skin creams with essential oils for use in aromatherapy; Oils for perfumes and scents; Perfume; Perfume oils; Perfumed creams; Perfumed soaps; Scented body spray; Skin soap.” It describes its essence as having been “created for the sole purpose of comfort and attraction” and marks its products with “Solace®”.

According to the doTERRA website, doTERRA sells its product, a blend for women, as “Solace™”. It describes its oil as “a proprietary blend of Certified Pure Therapeutic Grade® essential oils carefully formulated to balance hormones and manage symptoms of PMS and the transitional phases of menopause.” (It also provides the disclaimer, required by the Food and Drug Administration, that the “product is not intended to diagnose, treat, cure, or prevent disease.”)

In its complaint, Ambre Blends contends that doTERRA willfully and intentionally used the Solace mark knowing both that the mark was the property of Ambre Blends and that such a use was unlawful. It further asserts that doTERRA’s use of the mark was intended to cause confusion, mistake or deception among the general public and that doTERRA acted in bad faith.

The complaint asserts, inter alia, violations of the Lanham Act and unfair competition:

• Count I: Trademark Infringement
• Count II: False Designation of Origin
• Count III: Unfair Competition
• Count IV: Forgery
• Count V: Corrective Advertising Damages
• Count VI: Declaratory Judgment
• Count VII: Preliminary and Permanent Injunctive Relief

Trademark counsel for Ambre Blends seeks a declaratory judgment; a preliminary injunction; a permanent injunction; damages, including treble damages; costs and attorney’s fees; the transfer to Ambre Blends of any domain name that includes “Solace”; and corrective-advertising damages.

Practice Tip #1: From the complaint, this appears to be a straightforward case of infringement. However, Ambre Blends may have a tougher case than is obvious from the complaint itself. It appears from doTERRA’s sales literature that doTERRA has used the mark “Solace” along with “™”, thus claiming rights in the mark, at least as early as 2011. In contrast, Ambre Blends did not file its application until April 4, 2011; it was published for opposition on October 16, 2012. A federal registration confers a presumption of validity. However, here, the right to use the mark “Solace” may result in a battle of the facts.

Practice Tip #2: This complaint highlights the difference between the “®” mark and the “™” mark. While the former may not be used until a mark has been granted a federal registration, the latter has no such requirement. Instead, it may be used whenever a business wishes to put competitors on notice that it considers the mark to be its intellectual property.

Practice Tip #3: doTERRA is currently embroiled in litigation in both state and federal court in Utah with Young Living, another giant in the essential-oil industry.

November 7, 2013

WindStream Sues Rambo and Keebler for Trademark Infringement

By Overhauser Law Offices, LLC

New Albany, Indiana – WindStream Technologies, Inc. of North Vernon, Indiana filed a trademark infringement lawsuit in the Southern District of Indiana alleging that Rambo LLC, Rambo Montrow Corporation (collectively, “Rambo”) and Rick Keebler, all of Madison, Indiana, as well as ten unidentified John Does residing in Indiana, infringed its trademarked TurboMill, Trademark Registration No. 3,986,494, which has been registered by the United States Patent and Trademark Office.

WindStream manufactures wind turbines for municipal, residential and commercial use. Those turbines are shipped worldwide from its Indiana manufacturing facility. It contracted with Rambo and Keebler, who is asserted to be a principal of the Rambo entities, to provide component parts and to act as an authorized dealer of TurboMill turbines in certain territories.

WindStream has multiple contractual disputes with Defendants and Defendants’ predecessors in interest and asserts that component parts in which WindStream has an interest are being held “hostage” in an attempt to renegotiate the terms of one of the contracts. Further, WindStream contends that the failure of Defendants to deliver the parts has damaged its business. WindStream also charges Defendants with unfair competition, claiming that they are selling WindStream products, including WindStream’s TurboMill, as their own. Finally, it asserts that, among the prospective customers that Keebler and Rambo are targeting are individuals and entities that had previously been identified by WindStream as potential customers.

In its complaint, filed by the trademark attorney for WindStream, the following counts are alleged:

• Federal Unfair Competition and Passing Off (15 U.S.C. § 1125(a))
• Trademark Infringement (15 U.S.C. § 1114)
• Breach of Contract (Dealer Agreement)
• Breach of Contract (Purchase Orders)
• Interference with Contract and Prospective Economic Advantage

WindStream asks the court for an injunction prohibiting trademark infringement and similar conduct; damages, including treble damages; punitive damages for Defendants’ willful and malicious acts; and attorney’s fees and costs of the lawsuit.

Practice Tip: The complaint asserts that the trademark for TurboMill was registered on June 28, 2001 and that the mark has been used in commerce since at least 2009. In contrast, the registration is listed by the U.S. Patent and Trademark Office as having occurred on June 28, 2011 with the mark shown as having first been used in commerce in 2011, the same year in which WindStream began manufacturing its wind turbines. While the former inconsistency, which adds exactly ten years to the apparent life of the trademark, can be assumed to be a typographical error, the origin of the latter inconsistency, which adds another two years to the period during which the TurboMill mark is claimed to have been used in commerce, in unclear.