Chicago IP Attorney & Lawyer : R. David Donoghue : Chicago IP Litigation Blog

Loufrani v. Wal-Mart Stores, Inc., No. 09 C 3062, Slip. Op. (N.D. Ill. Nov. 12, 2009) (Kendall, J.).

Judge Kendall denied counterclaim defendants' (collectively "Smiley Company") Fed. R. Civ. P. 12(b)(6) motion to dismiss counterclaim plaintiff Wal-Mart's Lanham Act and related state law declaratory judgment claims related to Smiley Company's potential use of Wal-Mart's Mr. Smiley Mark, from Wal-Mart's well-known roll back campaign, after the Trademark Trial and Appeal Board ("TTAB") held that Smiley Company's mark was not distinctive and that the mark would create a likelihood of confusion with Wal-Mart's Mr. Smiley Mark.

First, the  Court held that Wal-Mart had plead sufficient facts to establish a controversy existed warranting Wal-Mart's declaratory judgment claims.  All of Wal-Mart's claims related to likelihood of confusion.  And the parties had developed "clear positions" on likelihood of confusion through their TTAB proceedings.  Furthermore, Smiley Company had already raised numerous claims against Wal-Mart, evidencing an actual controversy.  The Court also noted that this case was not like Geisha v. Tuccilli, 552 F. Supp. 2d 1002 (N.D. Ill. 2007) (click here and here to read more about the case in the Blog's archives).  In that case, the Court held there was no controversy, but declaratory judgment defendant had never used its mark and if he did use it by opening a restaurant, it would have been easy for declaratory judgment plaintiff to identify the use and alleged infringement.  Smiley Company, however, admitted to using its mark internationally since the 1970s.  Furthermore, Geisha was a summary judgment decision where the parties and the Court had the benefit of discovery.

Smiley Corp. also argued that the Court should only address its appeal of the TTAB decision and not Wal-Mart's broader claims.  The Court, however, held that a district court is free to decide infringement and likelihood of confusion issues as part of reviewing a TTAB decision.  The TTAB review instituted by Smiley Company was both an appeal and a new action which allowed the Court to address new issues and to admit new evidence.

Finally, Wal-Mart's Illinois Consumer Fraud and Deceptive Business Practices Act claim was not insufficient for failing to plead actual damages.  While actual damages were required, they could not exist in a declaratory judgment claim seeking to prevent future acts and, therefore, future damages.
 

• Email This
• Print
• Trackbacks
• Share Link

Geisha LLC d/b/a Japonais v. Tuccillo, No. 05 C 5529, Slip Op. (N.D. Ill. Mar. 13, 2009) (Pallmeyer, J.).*

Judge Pallmeyer denied plaintiff's motion for summary judgment regarding its Lanham Act false designation claim. Plaintiff began using the Japonais mark in conjunction with its Chicago area European/Japanese fusion restaurant in 2003. Plaintiff later opened New York and Las Vegas locations. But plaintiff did not register the Japonais mark. In 2004, defendant filed an intent to use trademark application for the Japonais mark to be used in connection with restaurants. In order to receive the registration, defendant was required to use the mark in commerce. Once that use occurred and was properly documented, defendant's mark would have a 2004 constructive use date, as opposed to the later date of actual first use. Defendant has filed a verified statement of use, so the parties agree that defendant's registration is a formality. Plaintiff, however, believed that it would succeed in a cancellation proceeding against the mark.

The Court noted that as the senior user, plaintiff had a right to use the mark in the Chicago area. But there was a question of fact as to whether plaintiff's later opened New York restaurant had sufficiently penetrated the New York market before defendant's 2004 constructive use date. Furthermore, to the extent plaintiff had actual notice of defendant's application, any rights plaintiff might have had in New York would not be enforceable against defendant. Furthermore, the Court noted that granting plaintiff's motion could result in the bizarre outcome of defendant being liable for violating plaintiff's trademark today, but tomorrow, after issuance of defendant's mark, defendant may be able to assert the trademark against plaintiff.

* For more on this case, click here to read the Blog's archives about the case or here for a Las Vegas Trademark Attorney post about the case.

• Email This
• Print
• Trackbacks
• Share Link

Geisha, LLC v. Tuccillo, No. 05 C 5529, 2007 W> 2608558 (N.D. Ill. Sep. 4, 2007) (Pallmeyer, J.).

Judge Pallmeyer held that the Court lacked jurisdiction over plaintiff Geisha’s declaratory judgment claim. Geisha operates a series of restaurants, each called Japonais – Japonais Chicago, Japonais New York and Japonais Las Vegas. Between the openings of Japonais Chicago and Japonais New York, defendant Roy Tuccillo (“Tuccillo”) filed an intent to use trademark application for a nearly identical Japonais mark, with the “firm intent” to open a restaurant using the mark. Geisha registered Japonais with the State of Illinois, but never federally registered the mark. Geisha sought, among other things, a declaratory judgment that Geisha owned the Japonais mark and that Tuccillo’s opening of a Japonais restaurant would infringe Geisha’s mark. The Court noted that the Seventh Circuit looks to patent law when considering whether there is an actual controversy in a trademark declaratory judgment action. The Court, therefore, relied upon the Supreme Court’s recent MedImmune, Inc. v. Genentech, Inc., 127 S.Ct. 765 (2007), decision which required that a controversy be “real and immediate,” overturning the Federal Circuit’s reasonable apprehension of suit test. The Court held that there was no “real and immediate” controversy. While Tuccillo had filed for registration of a Japonais mark nearly identical to Geisha’s and expressed his firm intent to open a Japonais restaurant, Tuccillo’s actions did not suggest that there was “imminent danger” that he would actually open a restaurant when the suit was filed. Tuccillo testified that he had generally looked at some properties to purchase for the restaurant, but he did not remember when he had done that and could not identify specific properties. Additionally, Tuccillo purchased a Chinese restaurant in 2002, but leased the space without opening a Japonais restaurant in 2003, two years before Geisha filed this suit.

• Email This
• Print
• Trackbacks
• Share Link