Indiana State Law

December 2, 2013

Wounded Warrior Project Sues Help Indiana Vets for False Advertising, Defamation and Unfair Competition

Indianapolis, Indiana – Wounded Warrior Project, Inc. (“WWP”) of Jacksonville, Florida has sued in the Southern District of Indiana alleging that Dean M. Graham and Help Indiana Vets, Inc. (“HIVI”), both of Acton, Indiana, defamed WWP. The lawsuit also asserts that HIVI engaged in false advertising and unfair competition. While this suit did not allege trademark infringement, it included references to WWP’s trademark, U.S. Trademark Registration No. 30014447, which has been registered by the U.S. Trademark Office.

WWP is a Virginia nonprofit corporation, which has been registered with the Internal Revenue Service (“IRS”) as a 501(c)(3) nonprofit organization. It was founded in 2003 as a small nonprofit corporation to provide comfort items to service members injured in combat after September 11, 2001. In the years which followed, WWP grew into a complete rehabilitative effort to assist service members injured in combat with both visible and invisible injuries (such as post-traumatic stress disorder, combat and operational stress, and depression) as they recover and transition back to civilian life.

HIVI is believed to be an Indiana nonprofit corporation. WWP indicates that HIVI was founded in April 2013 by Graham. WWP asserts that HIVI’s business is to offer financial help to Indiana veterans through donor support as a nonprofit. As such, WWP contends, HIVI is a direct competitor of WWP.

WWP asserts that, over the last decade, it has invested substantial time and resources to develop the WWP mark through national direct-mail campaigns, marketing, corporate product promotions and press releases. WWP indicates that it has received substantial national and local press coverage for its efforts. It claims that its success is due in no small part to the support of the media and celebrities who support WWP. Finally, WWP indicates that, over the last decade, it has received approximately 30 billion media impressions with an estimated publicity value of $500 million. WWP claims that, due to its efforts, the WWP mark has become famous.

This suit is founded upon, inter alia, WWP’s contentions that HIVI published false and misleading statements of fact regarding WWP. The assertions allegedly made by HIVI included that Wounded Warrior Project is a fraud and that it is pulling the biggest “Oke Doke” ever pulled on the American public. WWP contends that, on the page containing the purportedly false and misleading statements about WWP, a PayPal link is included so that users of the HIVI site may make charitable donations to HIVI.

WWP further alleges that HIVI has contacted numerous government entities and officials, as well as multiple media outlets, claiming that WWP is a fraud.

Trademark attorneys for WWP assert the following in their complaint against Graham and HIVI:

• Count I: False Advertising – Lanham Act
• Count II: Criminal Deception – Indiana Crime Victims Act
• Count III: Defamation – Indiana Common Law
• Count IV: Unfair Competition – Indiana Common Law
• Count V: Tortious Interference with Business Relationships – Indiana Common Law
• Count VI: Unjust Enrichment – Indiana Common Law

WWP asks the court for a permanent injunction; treble damages under the Indiana Crime Victims Act; an order compelling Defendants to disgorge all financial benefits realized as a result of the alleged wrongful conduct; and an award of costs and attorneys’ fees.

Practice Tip: Paul Overhauser was interviewed regarding this unusual lawsuit between nonprofit entities. See here.

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 18, 2013

Preliminary Injunction Improper for Overly Broad Non-Compete Agreement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Indiana Court of Appeals Judges Elaine Brown, Edward Najam and Paul Mathias reversed a trial court’s entry of preliminary injunction, holding that the non-compete agreement at issue was overly broad and, thus, unreasonable as a matter of law.

Glacier Group (“Glacier”) provides employee recruiting and placement services in the field of information technology. It primarily places salespeople, pre-sales engineers, systems engineers and people in leadership positions such as directors, vice presidents, chief financial officers and chief executive officers. Daniel Buffkin began working as a sales recruiter for Glacier in August 2008. Buffkin’s work with Glacier was subject to an “Independent Contractor Agreement” (the “Agreement”).

In June 2011, Glacier terminated the Agreement with Buffkin. In November 2012, it sued Buffkin alleging that he was in breach of the non-competition portion of the Agreement and requesting damages and injunctive relief.

In March 2013, the trial court determined that “during the almost three (3) year business relationship between [Glacier] and [Buffkin], [Buffkin] came into contact with a vast number of prospects and candidates, as well as clients of [Glacier], including their names and at the very least, their e-mail addresses, together with the requirements of [Glacier’s] customers for prospects and candidates to fill employment positions” and that “[t]his therefore created a legitimate protectable business interest by [Glacier].”

The trial court also stated that “[Buffkin] has admitted to directly competing against [Glacier] after being terminated from working for [Glacier]” and that Buffkin had been either unable or unwilling to supply a list of “where and when [Buffkin] has obtained the contacts he has made that he has used to make placements in the field in which [Glacier] works and operates.”

The trial court concluded that Glacier had a reasonable likelihood of success on the merits of its case and granted a preliminary injunction prohibiting Buffkin from competing with Glacier in employee placement in the areas of “data storage, cloud, virtualization, big data, managed hosting, managed services, data communication, and telecommunication.”

From this ruling, Buffkin brought an interlocutory appeal to the Indiana Court of Appeals. He argued that the non-compete clause of the Agreement was unreasonable and therefore unenforceable. He first asserted that the non-compete clause was overly broad because it did not have any restrictions regarding which industry it covered. He contended that, as written, the Agreement purported to prohibit him from doing executive recruiting in any industry. He also argued that the Agreement did not protect a legitimate interest of Glacier and that the restrictions on geographic scope were overly broad. Buffkin asked the Court of Appeals to hold that the trial court had abused its discretion in granting the preliminary injunction.

Glacier countered that it had provided Buffkin with insider knowledge and that Buffkin could not have had the success that he had after leaving Glacier without having used the proprietary information which he had acquired during his time with Glacier. It maintained that it had a protectable interest as a result of Buffkin’s purported use of insider knowledge acquired at Glacier and that Buffkin’s use of that information to Glacier’s detriment should be enjoined.

The appellate court first considered whether Glacier had an interest to be protected. It held that, while Buffkin may have acquired training, knowledge and skills while working at Glacier, such general skills would not be sufficient to rise to the level of a protectable interest unless their use would result in irreparable injury to Glacier. No such irreparable injury was proven. Glacier also failed to prove that, during his time with the company, Buffkin had access to proprietary information which gave him an improper advantage at Glacier’s expense. The court concluded that the interest to be protected by the non-competition provision of the Agreement, if any, was minimal.

The reasonableness of the restrictions was then addressed. Two provisions in particular were at issue: the geographic restriction and the activities restricted. The Agreement had attempted to restrict Buffkin from performing recruiting or placement services for employers “with offices in the continental United States.” The court held that Glacier had not met its burden of proof to demonstrate that it had a legitimate interest to be protected by such a broad restriction and held the geographic restriction to be unreasonable.

The court next held that the broadly worded text restricting Buffkin from being “connected in any way with any business that competes” with Glacier, and which made no distinction between past, current, or potential future customers of Glacier was excessive and, thus, unenforceable. It held that the trial court’s ruling had been clearly erroneous and that it had abused its discretion by granting the preliminary injunction.

Practice Tip #1: The Indiana Supreme Court has held that, to be enforceable, a non-compete agreement must be reasonable and that “[u]nlike reasonableness in many other contexts, the reasonableness of a noncompetition agreement is a question of law.” Such agreements in employment contracts are strongly disfavored under Indiana law as restraints of trade. They are scrutinized more closely than most other types of contracts and are strictly construed against the employer. Identifying a party to the contract as an independent contractor rather than as an employee does not change the analysis.

Practice Tip #2: A preliminary injunction should not be granted except in rare instances in which the law and facts are clearly within the moving party’s favor. To obtain a preliminary injunction, the moving party has the burden of showing by a preponderance of the evidence the following: (1) a reasonable likelihood of success at trial; (2) the remedies at law are inadequate; (3) the threatened injury to the movant outweighs the potential harm to the nonmoving party from the granting of an injunction; and (4) the public interest would not be disserved by granting the requested injunction. If the party seeking the preliminary injunction fails to prove any of these requirements, the trial court’s grant of an injunction will be considered an abuse of discretion.

August 8, 2013

Royal Purple Sues Compressor Parts, Michael Klipstein and Southern Parts & Engineering for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana — Royal Purple, LLC of Indianapolis, Indiana has sued Compressor Parts of Holland, Ohio; Michael Klipstein (“Klipstein”) and Southern Parts & Engineering Company, LLC (“Southern Parts”) of Alpharetta, Georgia (collectively, “Defendants”) for infringement of the trademarks ROYAL PURPLE and SYNFILM, which have been registered by the U.S. Trademark Office.

Royal Purple, which has also recently sued Liqui Moly, about which we blogged yesterday and previously, has filed an additional trademark-infringement suit in the Southern District of Indiana against Compressor Parts, Klipstein and Southern Parts.

Royal Purple claims it has sold lubricants for more than 20 years and has trademarked the color purple, at least in conjunction with various lubricating oils. It owns several federal trademark registrations for the color purple as applied to lubricating oils for automotive, industrial and household uses. It also owns multiple trademarks incorporating the word “purple” as applied to various goods. It also owns a trademark for the term “Synfilm,” for synthetic, para-synthetic and hydrocarbon lubricants for industrial uses. These trademarks are registered with the U.S. Trademark Office.

Purple was chosen for its association with royalty. (Historically, purple dye was so expensive to produce that it was used only by royalty.) Royal Purple’s purple-identified lubricant products are sold in over 20,000 retailers in the United States and Royal Purple claims a strong secondary meaning and substantial goodwill in its trademark as a result of this use.

In this complaint, trademark lawyers for Royal Purple assert that Defendants offer goods on the compressorparts.com website using Royal Purple marks in a manner that is likely to cause a substantial number of ordinary consumers to be mistaken, confused or deceived into thinking that Defendants’ goods are offered by or affiliated with Royal Purple. The complaint includes the following:

· Count I: Federal Trademark Infringement

· Count II: False Designation of Origin/False Advertising

· Count III: Unfair Competition Under Indiana Common Law

· Count IV: Common Law Trademark Infringement

Royal Purple seeks a permanent injunction; an accounting; damages, including punitive damages; interest; costs and attorneys’ fees.

Practice Tip: As part of the claim, Royal Purple’s lawyers included a count of trademark dilution. This cause of action is distinct from trademark infringement and applies to trademarks that are deemed to be famous. An action for dilution can assert either, or both, of two principal harms: blurring and tarnishment. Dilution by blurring, codified in 15 U.S.C. 1125(c)(2)(B), arises when association with another similar mark causes the distinctiveness of the famous mark to be compromised. In contrast, dilution by tarnishment under 15 U.S.C. § 1125(c)(2)(C) happens when the reputation of the famous mark is damaged by association with a similar mark.

August 7, 2013

Royal Purple Sues Liqui Moly GmbH and Liqui Moly USA for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana — Royal Purple, LLC (“Royal Purple”) of Indianapolis, Indiana sued Liqui Moly GmbH of Ulm, Germany and Liqui Moly USA, Inc. of Hauppauge, New York (collectively, “Liqui Moly”) alleging infringement of two marks, Registration Nos. 2,691,774 and 2,953,996, which have been registered with the U.S. Trademark Office.

Royal Purple is again suing over the use of the color purple. We have blogged previously about the company here. Royal Purple claims it has sold lubricants for more than 20 years and has trademarked the color purple, at least in conjunction with various lubricating oils. It owns several federal trademark registrations for the color purple as applied to lubricating oils for automotive, industrial and household uses. It also owns multiple trademarks incorporating the word “purple” as applied to various goods. These trademarks are registered with the U.S. Trademark Office.

Purple was chosen for its association with royalty. (Historically, purple dye was so expensive to produce that it was used only by royalty.) Royal Purple’s purple-identified lubricant products are sold in over 20,000 retailers in the United States and Royal Purple claims a strong secondary meaning and substantial goodwill in its trademark as a result of this use.

Liqui Moly is accused of distributing, offering to sell and selling products that infringe upon Royal Purple’s trademarks and engaging in acts that constitute unfair competition and dilution. Royal Purple also alleges that Liqui Moly’s use is a purposeful attempt to trade upon Royal Purple’s trademarks. It asserts that Liqui Moly’s infringing use of Royal Purple’s intellectual property is likely to cause confusion, mistake or deception in customers or potential customers who encounter the Liqui Moly products. It also claims that Liqui Moly’s use will dilute the “distinctive quality” Royal Purple’s trademarks. Finally, it alleges that Liqui Moly’s use removes from Royal Purple its ability to control the quality of products and services provided under Royal Purple’s trademark, by placing them partially under the control of Liqui Moly, USA and Liqui Moly GmbH, two third parties unrelated to Royal Purple.

Trademark attorneys for Royal Purple filed suit alleging:

· Count One: Trademark Infringement Under Federal Law – 15 U.S.C. § 1114

· Count Two: Unfair Competition; False Designation of Origin Under Federal Law – 15 U.S.C. § 1125(a)

· Count Three: Dilution Under Federal Law 15 U.S.C. 1125(c)

· Count Four: Dilution in Violation of Indiana Code § 24-2-1-13.5

· Count Five: Common Law Trademark Infringement

· Count Six: Unfair Competition Under Indiana Common Law

· Count Seven: Unjust Enrichment

Royal Purple seeks preliminary and permanent injunctions, the destruction of all allegedly infringing inventory, treble damages, costs and attorneys’ fees.

Practice Tip #1: Color can serve as a useful identifier of the source of goods to consumers. The courts, however, have had to draw some narrow lines to balance the various interests. On the one hand, companies often invest significant amounts of money in promoting their brands and color is frequently a component of that promotion. On the other hand, there are a limited number of colors — and an even more limited number of colors that are pleasing and appropriate for any given type of product — and courts are wary of providing a monopoly on any given color to any one company. After all, if such a monopoly is first provided to one company, all too soon the entire spectrum may be spoken for.

Practice Tip #2: This complaint, which is very similar to an earlier action filed by Royal Purple, has added Liqui Moly USA, Inc. as a defendant and largely omitted the earlier-filed claims relating to a third trademark, registered under the U.S. Registration No. 3,819,988.

July 31, 2013

Riders Choice Sues Golden West Saddle Blankets for Declaratory Relief

By Overhauser Law Offices, LLC

Terre Haute, Indiana — Copyright lawyers for Riders Choice, LLC d/b/a Show and Tell Saddle Blankets (“Riders Choice”) and Loni Rhodes (“Rhodes”; collectively,”Plaintiffs”) of Center Point, Indiana sued for declaratory relief over allegations of copyright infringement made by Lori Heckaman (“Heckaman”) d/b/a Golden West Saddle Blankets (“Golden West” or “Defendant”) of Gainesville, Texas.

Riders Choice, sometimes operating as “Show and Tell Saddle Blankets,” makes and sells products related to horseback riding, including hand-woven saddle blankets with colorful geometric designs. Rhodes owns Riders Choice. Heckaman, doing business as Golden West Saddle Blankets, also makes and sells products related to horseback riding, including blankets with colorful geometric designs.

Intellectual property counsel for Heckaman sent two cease-and-desist letters to Rhodes and Riders Choice, the first on June 14, 2013 and the second on July 2, 2013. The first cease-and-desist letter asserted that the designs on Heckaman’s blankets were copyrighted and alleged against Rhodes and Riders Choice claims for copyright infringement based on Rhodes’s and/or Riders Choice’s manufacture, marketing and sale of its own blankets. The second cease-and-desist letter made similar allegations. Claims were also made against Rhodes and Riders Choice for business interference, unfair competition and misappropriation of trade secrets based on Rhodes’s and/or Riders Choice’s marketing of Riders Choice’s blankets and alleged copying of Golden West’s weaving and design methods.

Both cease-and-desist letters threatened Rhodes and/or Riders Choice with imminent litigation if Rhodes and/or Riders Choice did not comply with Defendant’s demands, the first by writing “we will have no choice but to advise our client to protect her interests by instituting a suit in a court of competent jurisdiction,” and the second by writing that although “Golden West prefers to resolve this matter without the necessity of court intervention, all necessary action will be taken if a voluntary agreement cannot be reached.” Both cease-and-desist letters demanded that Rhodes and/or Riders Choice stop marketing, selling and producing its blankets. Further, a July 3, 2013 e-mail threatened Rhodes and Riders Choice with imminent litigation by writing that if Rhodes and/or Riders Choice did not “refrain from promoting, marketing, producing, and selling saddle blankets,” Heckaman would have “no choice but to seek available remedies.”

In response, copyright lawyers for Riders Choice filed a complaint under the Declaratory Judgment Act. In the complaint, Plaintiffs assert that blankets with similar designs are widely produced and sold by third parties, that they did not believe that Heckaman had registered any of her designs with the U.S. copyright office, that the blankets Riders Choice sells are original works designed by Rhodes and that every blanket Riders Choice sells is unique in that no two blankets are sold with an identical pattern. They further asserted that Rhodes learned these methods from books and other publicly available materials unaffiliated with Heckaman and that Rhodes had never copied Defendant’s designs.

In the complaint, Plaintiffs ask for judgments of:

· Count I — No Copyright Infringement

· Count II — No Business Interference

· Count III — No Unfair Competition

· Count IV — No Misappropriation of Trade Secrets

Plaintiffs request that the court: (a) declare that Rhodes’s and Riders Choice’s blankets did not in the past and do not now infringe any of Defendant’s valid copyrights; (b) declare that Rhodes and Riders Choice did not commit in the past and are not now engaged in business interference against Defendant based on the sale, marketing or production of blankets; (c) declare that Rhodes and Riders Choice did not commit in the past and are not now engaged in unfair competition against Defendant based on the sale, marketing or production of blankets; (d) declare that Rhodes and Riders Choice did not commit in the past and are not now engaged in the misappropriation of trade secrets from Defendant based on the sale, marketing or production of blankets; (e) award to Plaintiffs their costs and attorneys’ fees.

Practice Tip:

As with a patentee who believes that his or her patent is being infringed, holders of copyrighted materials often will send a “cease-and-desist letter” — a letter demanding that the purported infringer cease infringing. To aid in convincing the accused infringer to meet its demands, the holder of the intellectual property may be tempted to use language such as plans of “instituting a suit” and seeking “court intervention,” as Defendant did here.

As this case demonstrates, this strategy may backfire. By using such language, the Defendant can create an “actual controversy” for purposes of the Declaratory Judgment Act. Thus, the party alleging infringement (the natural plaintiff in an infringement suit) may instead find itself being sued by the alleged infringer (the natural defendant), often in a jurisdiction that would not have been the first choice of the owner of the intellectual property.

One approach that may have yielded better results for Golden West might have been to approach the accused infringer with an offer to license the purportedly protected intellectual property. With carefully crafted language, such a proposal might have served to put Riders Choice on notice of Golden West’s belief that infringement was occurring without going so far as to create an “actual controversy” sufficient to support a lawsuit under the Declaratory Judgment Act.

July 18, 2013

Master Cutlery Sues Pacific Solution Marketing for Infringement of Three-Dimensional Artwork Applied to Knives

By Overhauser Law Offices, LLC

Indianapolis, Indiana — Intellectual property lawyers for Master Cutlery, Inc. of Secaucus, New Jersey sued Pacific Solution Marketing, Inc. (“Pacific”) of Ontario, California alleging copyright and trademark infringement of three-dimensional artwork applied to knives. Master Cutlery seeks an injunction, damages, treble damages, statutory damages, profits, attorney’s fees and costs.

Founded 30 years ago, Master Cutlery has become the largest importer of knives in the United States. It asserts ownership of federal trademark, patent and copyright registrations for its knives, as well as common law trade dress rights (collectively, “Master Cutlery IP”). Among the rights that Master Cutlery claims are trademarks for the word marks “Sheriff” and “EMT” registered in Class 8 with the U.S. Trademark Office for knives.

Master Cutlery asserts that, after its use and registration of its various items of intellectual property, Pacific also began using the Master Cutlery intellectual property. It contends that Pacific has manufactured, produced, advertised and/or sold knives that infringe upon the Master Cutlery IP. It also asserts that Pacific has distributed advertisements and packaging bearing reproductions of Master Cutlery’s trademarks, trade dress and copyrights.

Master Cutlery sued alleging copyright infringement under the Copyright Act; federal trademark infringement, federal trademark dilution, false designation of origin and false advertising under the Lanham Act; common law trademark and copyright infringement; unfair competition; and theft and counterfeiting under Indiana state law. It further contends that this infringement was willful, intentional and done with the intent to confuse consumers. The complaint, originally filed in Indiana state court, was removed by a trademark attorney for Pacific on both the grounds of federal question and diversity of citizenship.

For its claims, Master Cutlery lists the following:

· Count I: Copyright Infringement Under 17 U.S.C. § 101 et seq.

· Count II: Federal Trademark Infringement Under U.S.C. § 1114

· Count III: Trademark Dilution Under 15 U.S.C. § 1125(c)

· Count IV: False Designation of Origin or Sponsorship, False Advertising and Trade Dress Infringement Under 15 U.S.C. § 1125(a)

· Count V: Common Law Trademark and Copyright Infringement

· Count VI: Unfair Competition

· Count VII: Theft Under Ind. Code § 35-43-4-2(a)

Master Cutlery asks for a permanent injunction enjoining infringement; that Pacific be required to deliver to Master Cutlery both unsold goods and goods already distributed or sold so that they can be destroyed; for compensatory damages; for treble damages or, alternatively, Pacific’s profits trebled; for statutory damages; and for attorneys’ fees and costs.

Practice Tip: Master Cutlery has included a count of felony theft under Indiana Code § 35-43-4-2(a) in its complaint. The extent to which intellectual property is “property” in the usual sense has been litigated several times recently in the Indiana appellate court, which has made it clear that criminal statutes often apply differently to an unlawful taking of intellectual property. For a discussion of two recent cases, see here and here.

July 17, 2013

Coach Sues Again in Indiana Court Alleging Trademark Infringement

By Overhauser Law Offices, LLC

South Bend, Indiana — Trademark lawyers for Coach, Inc. of New York, New York and Coach Services, Inc. of Jacksonville, Florida (collectively, “Coach“) have sued Maxx Tan; Maxx Tan Logan, LLC — both of Logansport, Indiana — and James Robert McCarthy (“McCarthy”) of Marion, Indiana, individually and d/b/a Maxx Tan, for infringement of the COACH trademark which has been registered by the U.S. Trademark Office.

Coach was founded more than 70 years ago as a family-run workshop in Manhattan. Since then, the company has been engaged in the manufacture, marketing and sale of fine leather and mixed-material products including handbags, wallets and accessories including eyewear, footwear, jewelry and watches. Coach products have become among the most popular in the world, with Coach’s annual global sales currently exceeding three billion dollars.

On October 17, 2012, a private investigator from Coach visited Maxx Tan and observed numerous trademarked handbags, sunglasses and accessories displayed for sale. These items bore the trademarks of many high-end brands, including Coach.

The investigator purchased a purse which bore a Coach trademark for $69 plus tax and left the store. The investigator then returned, explained the reason for the purchase, attempted to serve a cease-and-desist letter on McCarthy, and asked McCarthy to surrender the merchandise. McCarthy agreed to stop selling the merchandise but refused to surrender anything.

The investigator contacted the Logansport police. In the following weeks, Maxx Tan surrendered various purses, a pair of sunglasses and a sunglasses case to the police, all of which bore the Coach mark. All of the surrendered items are alleged to be counterfeit.

Coach, the owner of at least 47 trademarks, subsequently sued Maxx Tan and McCarthy, whom Coach contends is individually liable for any infringing activities. It alleges that Maxx Tan and McCarthy are engaged in designing, manufacturing, advertising, promoting, distributing, selling, and/or offering for sale products bearing logos and source-identifying indicia and design elements that are studied imitations of the Coach trademarks.

The complaint includes counts for trademark infringement, false designation of origin and false advertising under the Lanham Act, 15 U.S.C. §§ 1114, 1116, 1117, 1125(a) and (c); trademark infringement and unfair competition under the common law of the State of Indiana; and forgery under Indiana Code § 35- 43-5-2(b) as well as counterfeiting under Indiana Code § 35-43-5-2(a), pursuant to Indiana Code § 34-24-3-1. These counts are listed as:

· COUNT I (Trademark Counterfeiting, 15 U.S.C. § 1114)

· COUNT II (Trademark Infringement, 15 U.S.C. § 1114)

· COUNT III (False Designation of Origin and False Advertising, 15

U.S.C. § 1125(a))

· COUNT IV (Common Law Trademark Infringement)

· COUNT V (Common Law Unfair Competition)

· COUNT VI (Forgery Under Ind. Code § 35-43-5-2(b))

· COUNT VII (Counterfeiting Under Ind. Code § 35-43-5-2(a))

· COUNT VIII (Common Law Unjust Enrichment)

· COUNT IX (Attorneys’ Fees)

Coach asks the court, inter alia, to enter judgment against the defendants on all counts; for an injunction against further wrongful activity; to order that all infringing materials be recalled and disposed of; to award to Coach statutory damages of $2,000,000 per counterfeit mark per type of good; to award punitive damages; and to award to Coach its costs and attorneys’ fees.

Practice Tip: Coach has been very aggressive in protecting its intellectual property rights in Indiana courts over the last few years. Coach’s intellectual property attorneys have filed numerous similar lawsuits in Indiana courts, several of which Indiana Intellectual Property Law and News has blogged about.

July 1, 2013

Coach Sues Downtown Gift Shop and Chun Ying Huang for Trademark Infringement, Forgery and Counterfeiting – 1

By Overhauser Law Offices, LLC

South Bend, Ind. — Trademark lawyers for Coach, Inc. of New York, N.Y. and Coach Services, Inc. of Jacksonville, Fla. (collectively, “Coach”) sued Downtown Gift Shop of Mishawaka, Ind. and Chun Ying Huang of Granger, Ind. (“Huang”) alleging various violations of intellectual-property law, including trademark infringement, forgery and counterfeiting.

Coach was founded more than 70 years ago as a family-run workshop in Manhattan. Since then, the company has been engaged in the manufacture, marketing and sale of fine leather and mixed-material products including handbags, wallets and accessories including eyewear, footwear, jewelry and watches. Coach products have also become among the most popular in the world, with Coach’s annual global sales currently exceeding three billion dollars.

On December 8, 2012, a private investigator from Coach visited the Downtown Gift Shop and observed thousands of handbags, boots, and accessories displayed for sale. These items bore the trademarks of many high-end brands including Coach, Louis Vuitton, Chanel and Tiffany.

On December 11, 2012, investigators from Coach accompanied officers from the St. Joseph County Police Department, Indiana State Police Department, and the Department of Homeland Security, to execute a search warrant on Downtown Gift Shop.

The investigators and officers identified, photographed, and seized over 3,000 counterfeit trademarked merchandize, including over 1,000 Coach handbags, wallets, scarves, sunglasses, jewelry, and hats. Coach contends that all of the seized items are counterfeit.

Coach, the owner of at least 47 trademarks, subsequently sued Downtown Gift Shop and Huang, whom Coach contends is individually liable for any infringing activities. It alleges that Downtown Gift Shop and Huang are engaged in designing, manufacturing, advertising, promoting, distributing, selling, and/or offering for sale products bearing logos and source-identifying indicia and design elements that are studied imitations of the Coach trademarks.

The complaint includes counts for trademark infringement, false designation of origin and false advertising under the Lanham Act, 15 U.S.C. §§ 1114, 1116, 1117, 1125(a) and (c); trademark infringement and unfair competition under the common law of the State of Indiana; and forgery under Indiana Code § 35- 43-5-2(b) as well as counterfeiting under Indiana Code § 35-43-5-2(a), pursuant to Indiana Code § 34-24-3-1. These counts are listed as:

· COUNT I (Trademark Counterfeiting, 15 U.S.C. § 1114)

· COUNT II (Trademark Infringement, 15 U.S.C. § 1114)

· COUNT III (False Designation of Origin and False Advertising, 15 U.S.C. § 1125(a))

· COUNT IV (Common Law Trademark Infringement)

· COUNT VII [sic] (Common Law Unfair Competition)

· COUNT VIII (Forgery Under Ind. Code § 35-43-5-2(b))

· COUNT IX (Counterfeiting Under Ind. Code § 35-43-5-2(a))

· COUNT X (Common Law Unjust Enrichment)

· COUNT XI (Attorneys’ Fees)

Coach asks the court, inter alia, to enter judgment against the defendants on all counts; for an injunction against further wrongful activity; to order that all infringing materials be recalled and disposed of; to award to Coach statutory damages of $2,000,000 per counterfeit mark per type of good; to award punitive damages; and to award to Coach its costs and attorneys’ fees.

Practice Tip: Homeland Security Investigations (“HSI”), a directorate of U.S. Immigration and Customs Enforcement, is one of the agencies charged with investigating counterfeit goods. Much of the sales volume of counterfeit goods has moved to the Internet and, as part of its efforts, HSI is authorized to petition a court to order the seizure of domain names of websites selling counterfeit goods over the Internet.

One such seized domain name, http://designsfauxreal.com/, has been redesigned by HSI as a warning for visitors and includes such advertising copy as “FREE identity theft with every purchase” and “LOOK! Low quality counterfeit product. On closer inspection, alligator may resemble a tadpole.”

June 26, 2013

Microsoft Sues Mister HardDrive and Mark Cady for Copyright and Trademark Infringement

By Overhauser Law Offices, LLC

New Albany, Ind. — Intellectual property lawyers for Microsoft Corp. of Redmond, Wash. sued Mister HardDrive and Mark Cady of Scottsburg, Ind. alleging infringement of copyrighted work TX 5-407-055 titled Microsoft Windows XP Professional : version 2002 registered with the U.S. Copyright Office; and Trademark Registration Nos. 1,200,236; 1,256,083; 1,872,264 and 2,744,843 registered with the U.S. Trademark Office.

Microsoft, the seventh largest publically traded company in the world, has sued Mister Harddrive, a business entity of unknown legal structure that is also known as Mister HardDrive’s Wipe and Restore (“Mister HardDrive”), and Mark Cady, an individual, alleging that they engaged in copyright and trademark infringement; false designation of origin, false description and representation; and unfair competition.

Microsoft develops, markets, distributes and licenses computer software. Microsoft’s software programs are recorded on discs, and they are packaged and distributed together with associated proprietary materials such as user’s guides, user’s manuals, end user license agreements, and other components. Mister HardDrive is engaged in the business of advertising, marketing, installing, offering, and distributing computer hardware and software, including products sold as Microsoft software.

In its complaint, Microsoft alleges that Mister HardDrive and Mark Cady offered, installed, and distributed unauthorized copies of Microsoft software and thereby infringed Microsoft’s copyrights, trademarks and/or service mark. Infringement and/or misappropriation of Microsoft’s copyrights, advertising ideas, style of doing business, slogans, trademarks and/or service mark in defendants’ advertising is also alleged.

Microsoft asserts that in December 2012, defendants were found to have distributed computer systems with unauthorized copies of Windows XP installed on them. Microsoft asked defendants to stop making and distributing infringing copies of Microsoft software but claims that additional computers with unauthorized copies of Windows XP were subsequently distributed by defendants. Microsoft claims that such distribution of counterfeit and infringing copies of their software — along with related infringing items — is ongoing.

The complaint lists the following counts:

· First Claim [Copyright Infringement – 17 U.S.C. § 501, et seq.]

· Second Claim [Trademark Infringement – 15 U.S.C. § 1114]

· Third Claim [False Designation Of Origin, False Description And Representation –

· 15 U.S.C. § 1125 et seq.]

· Fourth Claim [Indiana Common Law Unfair Competition]

· Fifth Claim [For Imposition Of A Constructive Trust Upon Illegal Profits]

· Sixth Claim [Accounting]

Microsoft asks that the court adjudge that the defendants have willfully infringed its federally registered copyright; that the defendants have willfully infringed several of its federally registered trademarks and one of its service marks; that the defendants have committed and are committing acts of false designation of origin, false or misleading description of fact, and false or misleading representation against Microsoft; and that the defendants have engaged in unfair competition in violation of Indiana common law.

Microsoft seeks damages, an accounting, the imposition of a constructive trust upon defendants’ illegal profits, and injunctive relief.

Practice Tip: Microsoft has named as defendants both the business entity and the individual who has been identified as related to Mister HardDrive as “an owner, operator, officer, [or] shareholder, [who] does business as and/or otherwise controls” the business. A corporate officer, director or shareholder is, as a general matter, personally liable for all torts which he authorizes or directs or in which he participates, even if he acted as an agent of the corporation and not on his own behalf.