Trademark DJ Requires Allegations of Continued Rights in the Marks

Posted on January 21, 2009 by R. David Donoghue

Publications Int'l. Ltd. v. LeapFrog Enters., Inc., No. 08 C 2800, Slip Op. (Dec. 4, 2008) (Guzmán, J.).

Judge Guzmán granted declaratory judgment defendant LeapFrog's Fed. R. Civ. P. 12(b)(1) motion to dismiss plaintiff Publication International's (“PIL”) claim for declaratory relief regarding the POINGO mark used in association with a pen-like electronic reading device. PIL alleged, and LeapFrog admitted, that LeapFrog used the POINGO mark for a pen reader system in one presentation to a retailer, but never marketed or sold a pen reader using the name and never sought to register the mark with the PTO. PIL also alleged that LeapFrog sent PIL cease and desist letters warning that LeapFrog's earlier use of the POINGO mark gave it priority in the mark. The Court held that PIL had not met its burden because it had not alleged that LeapFrog had used the mark on products in commerce or that LeapFrog had sufficient intent to use the mark in commerce. Without a use in commerce or an intent to use, the immediacy required for a declaratory judgment action was not present.

 

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Inclusion of Trademark in Business Plan Not a Use in Commerce

Posted on December 30, 2008 by R. David Donoghue

Welsh v. Big Ten Conf., Inc., No. 08 C 1342, Slip Op. (N.D. Ill. Nov. 21, 2008) (Gottschall, J.).

Judge Gottschall granted defendant the Big Ten Conference's motion to dismiss plaintiff's complaint, but denied the Big Ten's motion for its attorney's fees. Plaintiff claimed that it presented the Big Ten with a trade secret business plan for a Big Ten television network named the "Big Ten Network." The Big Ten allegedly told plaintiff it was not interested and then several years later started the Big Ten Network using plaintiff's trade secrets, including the Big Ten Network name. Plaintiff claimed that the Big Ten violated § 38 of the Lanham Act by filing a false declaration with the PTO stating that the Big Ten had the sole right to use the Big Ten Network mark in commerce. Plaintiff argued that the Big Ten should have disclosed plaintiff's trade secret rights in the mark. But the Court held that even if plaintiff could establish trade secret rights, the Seventh Circuit had held that it was "far from clear" whether trade secret claims fall within the scope of § 38, which is directed to statements about ownership, as opposed to statements about use in commerce. Additionally, the Court held that plaintiff's alleged development of the name did not necessarily grant plaintiff any rights in the trademark. Trademark rights are granted based upon use, not discovery or invention. And inclusion in a business plan is not a "use in commerce." Having dismissed plaintiff's federal claim and noting that the parties were not diverse, the Court declined to exercise supplemental jurisdiction over the remaining state law claims and dismissed the case.

The Court denied the Big Ten's request for its fees. First, the case was resolved on a motion to dismiss filed two months after the complaint and while plaintiff's arguments lost, the theory had not been "squarely rejected by the Seventh Circuit." As such, plaintiff's suit could not be deemed "oppressive" as is required for an award of fees.

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Using a Trademark in Telemarketing is a Use in Commerce

Posted on July 30, 2008 by R. David Donoghue
Medline Indus., Inc. v. Strategic Comm. Sol'ns., No. 07 C 2783, __ F. Supp.2d __, 2008 WL 2091141 (N.D. Ill. May 5, 2008) (Castillo, J.).

Judge Castillo dismissed some defendants for lack of personal jurisdiction (the wrong defendants) and denied defendant Strategic Commercial Solutions (“SCS”). Fed. R. Civ. P. 12(b)(6) motion to dismiss. Plaintiff Medline alleged that defendants violated its trademark and related federal and state laws by selling “Medline Savings” packages with telemarketers.

Personal Jurisdiction

The Court did not have personal jurisdiction over the Wong defendants. The Wong defendants, all individuals, did not direct any of their allegedly infringing and fraudulent calls to Illinois residents. Their only contacts with Illinois were calls to and from Illinois banks regarding processing payments and refunds. These secondary contacts were not sufficient to create personal jurisdiction.

SCS similarly did not have sufficient contacts with Illinois. But Fed. R. Civ. P. 4(K)(2) provided for national, and therefore, there was personal jurisdiction in Illinois because SCS argued it was not subject to jurisdiction in any U.S. state or territory.

Telemarketing and Consumer Fraud and Abuse Act

SCS argued that Medline could not bring its Telemarketing and Consumer Fraud and Abuse Act claim because it was not a “private person” that was “adversely affected” by the telemarketing as required by the Act. But the Court held that while Medline was not an aggrieved consumer, the alleged unfair use of Medline’s trademarks could have caused Medline the harm it alleged.

Trademark Infringement

The Court noted that it was not aware of a similar case in which a party was accused of trademark infringement for using marks in telemarketing. But SCS’s alleged use of Medline’s marks was a use in commerce.

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