RICHARD W. STORY, District Judge.
This case comes before the Court on Plaintiff Schütz Container Systems, Inc. ("Schütz")'s Motion for Summary Judgment on Defendant National Container Group, LLC ("NCG")'s Counterclaims
As a preliminary matter, the Court
This case involves trademark infringement and false advertising claims arising out of the parties' manufacture and sale of intermediate bulk containers (IBCs). IBCs are used for the storage and transport of goods, both hazardous and non-hazardous. They consist of two major components: an outer cage and an inner bottle. The outer cage is attached to a pallet and may be made of metal, wood, or plastic. (Minnich Decl., Dkt. [198] ¶ 3.) Inside the cage is a "cube-like" plastic bottle designed to hold between 170 and 330 gallons of material. (
Since its inception in 1990, Plaintiff Schütz Container Systems, Inc. ("Plaintiff" or "Schütz") has been the leading seller of IBCs in the United States market. (Pl.'s Consolidated Statement of Additional Facts in Resp. Defs. Mauser & NCG's Mots. for Summ. J. on Pl.'s Claims ("Pl.'s Consolidated SAF"), Dkt. [230] ¶ 8, 11; Defs.' Mauser & NCG's Resps. to Pl.'s Consolidated SAF, Dkt. [257] ¶ 11.) Schütz manufactures and sells new IBCs, which consist of newly-manufactured Schütz metal cages and newly-manufactured Schütz bottles made of high density polyethylene ("HDPE"). (Pl.'s Mot. for Summ. J. on Def. NCG's Counterclaims ("Pl.'s Mot. for Summ. J."), Dkt. [194] at 4 of 29; Pl.'s App'x of Excerpts & Materials in Supp. Pl.'s Mot. for Summ. J. ("Pl.'s App'x in Supp. Mot. for Summ. J."), Dkt. [195] Tab D, 12/16/2010 Dep. Brian Minnich, at 214:2-5.) The plastic bottle is approximately flat on all four sides and designed to fit the Schütz cage. (Minnich Decl., Dkt. [198] ¶¶ 4-5.)
In addition to selling new IBCs, Schütz also sells used IBCs-IBCs that have been used at least once, returned to Schütz, and reconditioned by Schütz for further use. (Pl.'s App'x in Supp. Mot. for Summ. J., Dkt. [195] Tab D, 12/16/2010 Dep. Brian Minnich, at 214:19-24.) Reconditioning can occur in one of two ways: "washing" or "rebottling." If the IBC simply is "washed," the original cage and bottle are retained but cleaned and reconditioned for further use. (
Defendants Mauser Corporation ("Mauser") and National Container Group, LLC ("NCG") ("Defendants") are affiliated entities and competitors of Schütz in the IBC market. (Defs. Mauser & NCG's Statement of Undisputed Material Facts in Supp. Mot. for Summ. J. on Pl.'s Trademark Claims (Counts II, IV-VI) ("Defs.' Trademark Mot. for Summ. J.") ("Defs.' Trademark SMF"), Dkt. [214] ¶ 9; Pl. Schütz's Consolidated SAF, Dkt. [230] ¶ 1.) Mauser, like Schütz, manufactures and sells new IBCs. (Defs.' Trademark SMF, Dkt. [214] ¶¶ 7-8.) The Mauser IBC consists of a Mauser outer cage and Mauser inner bottle, the latter of which is designed to fit the Mauser cage. (Pl.'s App'x in Supp. Mot. for Summ. J., Dkt. [195] Tab H, 12/2/2010 Dep. T.J. Janowski, Ex. 110 at 2.) Unlike the Schütz bottle, which is approximately flat on all four sides, the Mauser bottle has indentations on its four side walls. (Pl.'s Consolidated SAF, Dkt. [230] ¶ 89.) These indentations line up with the bars of the Mauser cage but do not line up with the bars of the Schütz cage. (
NCG does not manufacture new IBCs but rather is in the business of reconditioning IBCs. (Defs.' Trademark SMF, Dkt. [214] ¶¶ 10-12.) It is one of the largest-if not the largest-reconditioners in the IBC industry. (
NCG is the largest cross-bottler in the United States. (Pl.'s Consolidated SAF, Dkt. [230] ¶ 31.) Because it is owned by Mauser, NCG has access to a steady supply of Mauser bottles and therefore generally cross-bottles using the Mauser bottle. (Pl.'s App'x in Supp. Mot. for Summ. J., Dkt. [196] Tab L, 1/28/2011 Dep. of John Smyth, at 56:13-23; Pl.'s Conslidated SAF, Dkt. [230] ¶ 15.) Additionally, NCG almost always cross-bottles using a Schütz outer cage: "[t]he cross-bottled units that NCG sells almost always consist of a Schütz cage and a Mauser bottle." (Pl.'s Consolidated SAF, Dkt. [230] ¶ 33.) When NCG cross-bottles, it does not remove the "Schütz" name from the used outer cage. (Defs.' Trademark SMF, Dkt. [214] ¶ 17.) This Schütz/ Mauser cross-bottled IBC is the product at issue in this case.
Most of the following "facts" regarding the regulation of IBCs come from Plaintiff's brief in support of its motion for summary judgment, which facts Plaintiff provides only for "background and context." (Pl.'s Mot. for Summ. J., Dkt. [194] at 2 n.1 of 29.) Contrary to the requirements of Local Rule 56.1(B)(2), Plaintiff asserted these purported facts only in its brief and did not include them in its statement of undisputed material facts. Furthermore, Plaintiff states in its brief that these "background" facts are not material to its motion. (Pl.'s Mot. for Summ. J., Dkt. [194] at 2 n.1 of 29.)
Under Local Rule 56.1(B)(1)(d), the Court is not to consider facts raised outside of the Rule 56.1 statement. Defendant NCG, however, in an abundance of caution, has responded to each of these facts. The Court also finds these "facts"-although not essential to resolving Plaintiffs' motion-helpful in understanding the parties' arguments and legal positions. Accordingly, to the extent NCG has responded to and does not dispute the facts raised only in Plaintiff's brief, and to the extent they help the Court understand the parties' arguments, they are repeated here.
As stated above, IBCs may be used to transport both hazardous and nonhazardous goods. If an IBC is intended to transport hazardous goods in the United States, the manufacturer must have the IBC "design type tested" in accordance with United States Department of Transportation ("USDOT") regulations. (NCG's Resps. to Pl.'s Facts in Supp. Mot. for Summ. J., Dkt. [242] ¶¶ 33, 35.) The USDOT regulations are modeled after United Nations ("UN") regulations on the transport of hazardous goods. (
Schütz is a staunch critic of the practice of cross-bottling, generally, and of NCG's cross-bottling using a Schütz cage, in particular, summing up its views on the issue as follows: "retention of the SCHÜTZ mark on an IBC not manufactured, tested or sold by Schütz confuses consumers, harms the Schütz brand, poses unclear liabilities, and is an extreme and unacceptable risk to consumers." (Pl.'s Mot. for Summ. J., Dkt. [194] at 10 of 29.) Schütz argues that the practice of cross-bottling adversely affects original manufacturers and the overall IBC industry in several ways. (
Second, Schütz argues that cross-bottling creates confusion among customers as to the source of the IBC and thus the entity they should contact for service or information. (
Schütz filed this action against Defendants Mauser and NCG on December 23, 2009, raising claims for trademark infringement and false advertising under both state and federal law, as well for unjust enrichment, stemming from Defendants' cross-bottling using the Schütz cage.
On December 10, 2010, Defendant NCG amended its original Answer, Affirmative Defenses, and Counterclaims (Dkt. [60]) to assert claims against Schütz for false advertising under federal law (Fourth Counterclaim) and, relatedly, for product disparagement under state law (Fifth Counterclaim). (Dkt. [101].) These claims are based on various statements made by Schütz impugning cross-bottled IBCs. The parties now move for summary judgment on the claims of their respective opponents. After setting out the governing legal standard, the Court considers each motion in turn.
Federal Rule of Civil Procedure 56 requires that summary judgment be granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "The moving party bears `the initial responsibility of informing the . . . court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact.'"
The applicable substantive law identifies which facts are material.
Finally, in resolving a motion for summary judgment, the court must view all evidence and draw all reasonable inferences in the light most favorable to the non-moving party.
Utilizing this framework, the Court considers, in turn, Plaintiff Schütz's Motion for Summary Judgment on Defendant NCG's Counterclaims ("Schütz's Motion for Summary Judgment") [184] and Defendant Mauser and NCG's Motions for Summary Judgment on Plaintiff Schütz's Trademark Claims ("Defendants' Trademark Motion for Summary Judgment") [187] and False Advertising and Unjust Enrichment Claims ("Defendants' False Advertising and Unjust Enrichment Motion for Summary Judgment") [188].
Plaintiff Schütz moves for summary judgment on Defendant NCG's Fourth and Fifth Counterclaims, which raise, respectively, claims for false advertising under Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B), and for product disparagement under Georgia's Uniform Deceptive Trade Practices Act ("UDTPA"), O.C.G.A. § 10-1-372(a)(8). (Defs. Mauser & NCG's First Am. Answer, Affirmative Defenses, & Counterclaims ("Defs.' Am. Counterclaims"), Dkt. [106] at 31-33 of 38, ¶¶ 34-45.) Both counterclaims stem from statements made by Schütz in reference to the cross-bottling business. In particular, NCG identifies nineteen (19) statements made by Schütz that allegedly constitute false advertising (actionable under the Lanham Act) and/or product disparagement (actionable under Georgia's UDTPA).
In its Fourth Counterclaim, NCG alleges that Schütz has engaged in false advertising in violation of Section 43(a) of the Lanham Act, which prohibits the use of any "false or misleading description of fact . . . which in commercial advertising or promotion, misrepresents the nature, characteristics, [or] qualities. . . of . . . another persons's goods, services, or commercial activities." 15 U.S.C. § 1125(a)(1)(B). NCG alleges, specifically, that Schütz has made false representations of fact concerning the cross-bottling business, with the purpose and effect of influencing purchasers and customers not to buy cross-bottled IBCs from NCG, thereby damaging NCG's reputation and shifting customers away from it and in favor of Schütz. (Defs.' Am. Counterclaims, Dkt. [106] at 32 of 38, ¶¶ 36-37.)
Of the nineteen total accused statements referenced above, NCG identifies Statements 1-5
(NCG's Opp'n, Dkt. [240] at 12-13 of 29; NCG's Opp'n Ex. 1, Dkt. [240-1] at 3 of 10.)
To prevail on a Lanham Act false advertising claim, the claimant must ultimately prove that "(1) the ads of the opposing party were false or misleading, (2) the ads deceived, or had the capacity to deceive, consumers, (3) the deception had a material effect on purchasing decisions, (4) the misrepresented product or service affects interstate commerce, and (5) the movant has been-or is likely to be-injured as a result of the false advertising."
In this case, Schütz moves for summary judgment on the Lanham Act counterclaim on grounds that NCG has failed to establish the first essential element of the claim-falsity.
When determining whether a statement is literally false, courts "must analyze the message conveyed in full context" and "view the face of the statement in its entirety. . . ."
The Court thus undertakes to determine-viewing the evidence and the reasonable inferences therefrom in the light most favorable to NCG-whether there is an issue of material fact as to whether Statements 1-3 and 5 are literally false. If there is no such issue and the undisputed evidence shows that the Statements are not false, then Schütz is entitled to judgment as a matter of law. If, on the other hand, there is a genuine factual dispute as to whether the Statements are false (such that a reasonable jury could find the Statements to be false), Schütz's motion for summary judgment must be denied.
Statements 1-3 and 5 each pertain to the test-ability of cross-bottled IBCs. The Court sets out the context of each Statement before considering whether a reasonable jury could find the Statements to be false.
Statement 1 appears on a page of Schütz's website entitled "Originality makes for safety." (Counterclaim-Pl. NCG's Statement of Additional Material Facts in Opp'n to Counterclaim-Def. Schütz's Mot. for Summ. J. on NCG's Counterclaims ("NCG's Statement of Additional Facts (SAF)"), Dkt. [241] ¶ 26 & Ex. S.)
(
Statements 2 and 3 appear in a Schütz PowerPoint presentation entitled "IBC Handling Guide," in a chapter entitled "Reconditioning and Originality." (
The presentation's table of contents, entitled "Chapters," lists twelve chapters of the presentation, which are further divided into two topical groups-"Product Information" and "Operating Information." (NCG's SAF, Dkt. [241] Ex. SS.) The titles of the twelve chapters are as follows: (1) Product Description, (2) Components, (3) Reconditioning and Originality, (4) Performance and Tests, (5) Labels, (6) General Use and Installation Instructions, (7) Use With Hazardous Goods, (8) Storage, (9) Handling, (10) Filling Operations, (11) Emptying Operations, and (12) Use of Valves. (
(
Statement 5 is contained in another Schütz PowerPoint presentation entitled "Reconditioning — Originality," on a slide entitled "Good reasons against cross-bottling and similar activities." (
Statements 1-3 and 5 each make one or both of the following claims: first, that an IBC with a non-OEM part "cannot be considered tested and proven," or second, that the results of interaction between original and non-OEM parts in an IBC "are unknown." NCG argues that the undisputed evidence shows these statements to be false-
In support of its claim that each of these statements is literally true, Schütz makes the following arguments: First, Schütz argues that the undisputed evidence shows that the IBC industry as a whole "has been concerned about incidents of `rogue' or improper cross-bottling for years." (Schütz's Mot. for Summ. J., Dkt. [194] at 21 of 29.) Second, Schütz argues that cross-bottled IBCs do not undergo the same testing and quality control measures as those to which wholly-Schütz manufactured IBCs are subjected. (
Having examined the Statements in their context and considered the arguments of the parties, the Court concludes that Statements 1-3 and 5 cannot be found to be "literally false" because they are ambiguous. Before explaining this conclusion, the Court first notes that most of Schütz's arguments regarding the alleged truth of the Statements were irrelevant and unpersuasive. For example, even if-as Schütz contends-the uncontroverted evidence demonstrates industry-wide concern over cross-bottling or that certain NCG cross-bottled IBCs are not UN/USDOT certified, these facts would not prove that crossbottled IBCs, in the absolute, cannot be considered tested and proven, or that the interaction between original and non-OEM parts is absolutely unknown. On the contrary, as NCG argues, the fact that NCG has UN/USDOT certified crossbottled IBCs disproves the notion that no cross-bottled IBC can ever be considered tested or proven; as a logical corollary, since cross-bottled IBCs can be UN/USDOT certified, i.e., tested and proven, it cannot be said that the interaction of original and non-OEM components is unknown.
Schütz also argues, however, that the accused statements are true because cross-bottled IBCs are not subjected to Schütz's internal testing and quality control protocols. Therefore, the argument presumably goes, from the standpoint of Schütz, cross-bottled IBCs are not tested and approved and the interaction between original and non-OEM parts is unknown. It is this argument that convinces the Court that Statements 1-3 and 5 are ambiguous and therefore not false.
The Court reaches this conclusion despite NCG's argument to the contrary. According to NCG, the accused statements unambiguously assert that cross-bottled IBCs, as an absolute matter, cannot be considered tested and approved for use in the IBC industry (and that the interactions between original and non-OEM parts are unknown from an industry standpoint). NCG argues that the Statements cannot be read as referring only to Schütz's own internal testing procedures because the Statements themselves never reference those procedures. (NCG Opp'n, Dkt. [240] at 17 of 29.) The Court, however, disagrees. Considering them in their context, a reasonable jury could understand the meaning of the Statements to be that cross-bottled IBCs cannot be considered tested and proven according to Schütz's testing protocols (and the interaction between original and non-OEM parts unknown with respect to those protocols).
As set forth in detail above, each statement appears in the context of a broader discussion of the process by which Schütz designs and tests each component of its IBCs, with specific attention to how those components interact with one another, and reconditions them through the SCHÜTZ TICKET SERVICE. Given their context, a reasonable jury could find accused Statements 1-3 and 5 to mean that because cross-bottled IBCs are not subjected to that process, they are not tested or proven, or the interaction between their original and non-OEM parts known, from Schütz's perspective. Accordingly, because the statements reasonably are susceptible to this alternate interpretation, they are ambiguous and cannot be found to be "literally false." Plaintiff thus is entitled to summary judgment on NCG's Lanham Act Fourth Counterclaim based on accused Statements 1-3 and 5.
Schütz moves for summary judgment as to Statement 4 on grounds that Statement 4 is a non-actionable statement of opinion (and, alternatively, because it is not literally false). "Statements of opinion are generally not actionable [under the Lanham Act]."
Statement 4 appears in the IBC Handling Guide, along with Statements 2 and 3, as a sub-bullet point on one of the four slides of Chapter (3), "Reconditioning & Originality." (NCG SAF, Dkt. [241] Ex. SS.) The Statement provides, "Unclear legal, liability and warranty questions:[,]" under which the question is posed, "Who is to blame, who is to be contacted?" (
NCG contends that Statement 4 is not a statement of opinion but rather a "literally false" statement of fact. In support of this contention, NCG points to the existence of UN/USDOT regulations, which NCG contends govern the legal and liability issues surrounding cross-bottled IBCs, thus making those issues clear. (NCG Opp'n, Dkt. [240] at 21 of 29.) According to NCG, the applicable regulations "provide that the testing and remanufacturing of cross-bottled IBCs is the responsibility of the remanufacturer-«0f the components' manufacturer." (NCG Opp'n, Dkt. [240] at 21 of 29.)
The Court finds NCG's argument unavailing. Although regulations on cross-bottled IBCs appear to exist, NCG fails to show that the regulations make legal, liability, and warranty questions absolutely clear as a factual matter. Indeed, as any observer of the legal system knows, the existence of a law on point does not end all controversy or confusion regarding the issue it governs. In other words, while a regulation may exist, reasonable minds can still differ as to the regulation's meaning, scope, or, as in this case, clarity. In sum, because it is a statement of opinion that cannot be classified as literally false, Plaintiff Schütz is entitled to summary judgment on Defendants' Lanham Act Fourth Counterclaim to the extent it is based on Statement 4.
Based on the foregoing, the Court finds that none of Statements 1-5 is actionable as false advertising under the Lanham Act. Accordingly, Schütz's Motion for Summary Judgment on NCG's Lanham Act Fourth Counterclaim is
In its Fifth Counterclaim, NCG alleges that all nineteen accused statements are actionable as product disparagement under Georgia's UDTPA, O.C.G.A. § 10-1-327
Based on the Court's ruling in Part II.A., supra, finding Statements 1-5 to be ambiguous and therefore not literally false, Statements 1-5 cannot give rise to liability under the UDTPA, which, like the Lanham Act, prohibits only "false or misleading" misrepresentations of fact.
With regard to Statements 6-19, NCG argues that Plaintiff's motion should be denied because unlike under the Lanham Act, a statement need not be disseminated to customers to give rise to liability under the product disparagement provision of the UDTPA. (NCG's Opp'n, Dkt. [240] at 25-26 of 29.) That is, this provision does not require that a false statement be made in a "commercial advertising or promotion" but rather only that it be published. (
The Court agrees with Defendants and finds that an accused statement need not have been disseminated to customers so as to constitute "commercial advertising or promotion," as is required under the Lanham Act, to be actionable under the product disparagement provision of Georgia's UDTPA. The statutory text has no such limitation, and Plaintiff has not directed the Court to any Georgia authority finding one.
For example, in
Similarly, in
Based on the plain language of the UDTPA and the foregoing authority, the Court agrees with NCG that accused statements 6-19 need only have been published to be actionable. In addition to arguing that the statements are not actionable because they were not made to customers, however, Plaintiff also seeks summary judgment as to these statements on grounds of privilege. (Pl.'s Mot. for Summ. J., Dkt. [194] at 26 of 29.) Citing O.C.G.A. § 51-5-7(3), Plaintiff contends that it was privileged to make Statements 6-19, each of which was made to a regulatory agency or trade association for the purpose of protecting Plaintiff's interests in the IBC industry by making its position on cross-bottling known. (
Under O.C.G.A. § 51-5-7(3), "Statements made with a good faith intent on the part of the speaker to protect his or her interest in a matter in which it is concerned" are deemed to be privileged communications. As the Georgia Supreme Court has held, "One may publish, by speech or writing, whatever he honestly believes is essential to the protection of his own rights or those of another, provided the publication be not unnecessarily made to others than to those whom the publisher honestly believes are concerned in the subject-matter of the publication."
The undisputed evidence shows that accused Statements 6 and 7 were made to "various governments or UN delegations." (NCG's SAF, Dkt. [241] ¶ 35.) Statement 8 was made to the executive director of the Rigid Intermediate Bulk Container Association ("RIBCA"). (
Each of the statements relates to Schütz's concerns with the practice of cross-bottling, which practice Schütz believes to be harmful to the IBC industry and adverse to its business interests.
In sum, the Court finds that Statements 1-5 are not actionable under Section 10-1-372(a)(8) because they are not false. Statements 6-19 are not actionable because they are privileged. Accordingly, Plaintiff's motion for summary judgment on NCG's UDTPA Fifth Counterclaim is
In accordance with the foregoing, Plaintiff's Motion for Summary Judgment on NCG's Lanham Act Fourth Counterclaim and UDTPA Fifth Counterclaim is
Defendants Mauser and NCG move for summary judgment on Plaintiff Schütz's trademark claims raised in Counts II, IV, V, and VI of the Complaint. In Count II, Plaintiff raises a federal law claim for false designation of origin under Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(A). In Counts IV, V, and VI, Plaintiff raises state law trademark claims, specifically, for deceptive trade practices under Georgia's UDTPA (Count IV), for fraud under O.C.G.A. § 23-2-55 (Count V), and for common law unfair competition and deceptive trade practices (Count VI). The parties agree that the federal Lanham Act analysis governs the analysis of Plaintiff's state law claims. (
"False designation of origin" is a theory of federal trademark infringement that arises under Section 43(a) of the Lanham Act.
The theory behind Plaintiff's false designation of origin claim is that Plaintiff has common law trademark rights in the "Schütz" name, and that Defendants unlawfully infringe on those rights by inserting Mauser bottles into used Schütz cages and selling the cross-bottled product without first removing the Schütz mark (
The first inquiry for the Court is therefore whether Schütz has presented sufficient evidence from which a reasonable jury could find trademark rights in the "Schütz" name. If so, the Court must then determine whether there is sufficient evidence of likelihood of consumer confusion to hold a trial on the merits of Plaintiff's Lanham Act claim.
A trademark is "any word, name, symbol, or device, or any combination thereof [used] to identify and distinguish [one's] goods . . . from those manufactured or sold by others and to indicate the source of the goods." 15 U.S.C. § 1127. "To satisfy the first element of § 43(a)-proof of a valid trademark-a plaintiff need not have a registered mark."
The Eleventh Circuit recognizes four categories of distinctiveness, "listed in ascending order of strength: (1) generic-marks that suggest the basic nature of the product or service; (2) descriptive-marks that identify the characteristic or quality of a product or service; (3) suggestive-marks that suggest characteristics of the product or service and require an effort of the imagination by the consumer in order to be understood as descriptive; and (4) arbitrary or fanciful-marks that bear no relationship to the product or service, and the strongest category of trademarks."
In this case, Plaintiff Schütz claims to have protectable trademark rights in the name, "Schütz," which is the last name of Plaintiff's founder, Udo Schütz. (Defs. Mauser and NCG's Statement of Undisputed Material Facts in Supp. Trademark Mot. for Summ. J. ("Defs.' Trademark SMF"), Dkt. [214] ¶ 60.) Names are descriptive marks, which, as stated above, are entitled to trademark protection only if they have acquired secondary meaning.
To show that a name has acquired secondary meaning, a plaintiff must show that "the primary significance of the [name] in the minds of the consuming public is not the product but the producer."
In support of its claim that the "Schütz" name is a protectable trademark, Plaintiff argues, first, that its brand name is strong and widely recognized by consumers. (Pl.'s Consolidated Opp'n, Dkt. [227] at 11-12, 29-31, 37-39 of 60.) In support of this argument, Plaintiff puts forward evidence that Defendants themselves describe the Schütz brand as strong and admit that brand recognition gives Schütz a competitive advantage in the marketplace. For example, in the deposition of T.J. Janowski of Mauser, the deponent admitted that Mauser believes the name Schütz to be "widely recognized by customers." (Pl.'s App'x of Excerpts and Materials in Supp. Pl.'s Consolidated Opp'n ("Pl.'s App'x"), Dkt. [227] Tab H, 12/2/10 Dep. of Mauser & T.J. Janowski, at 223: 7-9.) Likewise, in a deposition of NCG designee Kathryn Graue, Graue stated that Schütz "ha[s] a strong reputation in the marketplace." (Pl.'s App'x, Dkt. [227] Tab F, 11/5/10 Dep. of NCG (Kathryn Graue, Designee), at 119:18-23.) Similarly, several Mauser presentations regarding IBCs and the IBC market list Schütz's market advantages over Mauser as including "brand name," "global recognition," being a "technological leader," and being perceived as higher quality. (
Plaintiff also points to its long-standing presence in the United States IBC market, its efforts to advertise and promote its IBC, and its high volume of sales in the U.S. IBC market. Specifically, Plaintiff presents evidence that it was founded in the United States in 1990 (as an affiliate of the worldwide Schütz organization) and has since that time been the exclusive manufacturer and dealer of original Schütz products in the United States. (Pl.'s Consolidated Statement of Additional Facts in Response to Defs.' Mots. for Summ. J. on Pl.'s Claims ("Pl.'s Consolidated SAF"), Dkt. [230] ¶¶ 7, 9; Decl. of Ian Miller ("Miller Decl."), Dkt. [231] ¶¶ 3-4.) Since that time, Schütz has marketed all of its products under the "Schütz" brand name and has marketed its products in the United States through various media, including its website, brochures, and trade shows. (Pl.'s Consolidated SAF, Dkt. [230] ¶¶ 12-15.) Plaintiff contends that since at least 1998, Schütz has spent up to approximately $150,000 annually on trade show expenditures. (
The Court finds that Schütz has presented sufficient evidence of secondary meaning to withstand Defendants' motion for summary judgment. With regard to the first three factors listed above (length and manner of use, nature and extent of advertising/ promotion, and efforts to promote brand recognition), Schütz has presented evidence that it has marketed its products in the United States for over twenty years, exclusively under the brand name Schütz. It also has presented evidence of efforts to advertise and promote its brand name through trade shows, its website, and brochures. The evidence also shows-and Defendants do not dispute-that Schütz has been the market leader in terms of IBC sales since before the year 2000. Most importantly, and with relevance to the fourth factor (extent to which public identifies name with claimant's goods), Schütz has presented compelling evidence of the strength of its brand name in the IBC market. Indeed, Defendants themselves have admitted, in both depositions and corporate documents pre-dating this litigation, that the Schütz name is "widely" and "globally" "recognized by customers" and that Schütz has a "strong reputation in the marketplace." In light of this evidence, a reasonable jury could find the "Schütz" name to have acquired secondary meaning so as to be entitled to trademark protection. Defendants thus are not entitled to summary judgment on the ground that Plaintiff has failed to establish trademark rights in the "Schütz" name.
In addition to arguing that Plaintiff has presented insufficient evidence of "secondary meaning," Defendants argue that Plaintiff is not entitled to trademark protection of the "Schütz" mark because Plaintiff has failed to take action against other alleged infringers, thereby forfeiting any distinctiveness the "Schütz" mark may have had. (Defs.' Trademark Mot. for Summ. J., Dkt. [213] at 18-20 of 34.) To the extent Defendants contend that the Schütz mark has been abandoned, their motion for summary judgment fails. "The defense of abandonment requires strict proof."
To the extent Defendants contend that the "Schütz" mark has become generic because of Plaintiff's failure to take action against other alleged infringers, the motion for summary judgment similarly fails. Defendants contend that at least six entities other than Defendants also cross-bottle using a Schütz outer cage. (Defs.' Trademark Mot. for Summ. J., Dkt. [213] at 18 of 34.) Defendants further contend that Schütz is aware of this fact and yet has failed to take any legal action against these other entities to stop the alleged infringement. (
In this case, the only evidence Defendants put forward in support of their argument that Plaintiff has abandoned the name "Schütz" to generic usage is that Plaintiff has failed to take legal action against any of the six companies that Defendants contend are engaged in the same cross-bottling activities as Defendants. Putting aside the factual dispute regarding the number of entities that Schütz knew to be cross-bottling using a Schütz container (
In sum, Defendants are not entitled to summary judgment on Plaintiff's trademark claims on grounds that Plaintiff has failed to establish trademark rights in the "Schütz" name. On the contrary, as explained above, Plaintiff has presented sufficient evidence from which a reasonable jury could find "Schütz" to have acquired secondary meaning so as to be entitled to trademark protection. Additionally, Defendants have failed to show abandonment of the "Schütz" mark. Having found sufficient evidence of a protectable trademark right, the Court must next determine whether Plaintiff has presented sufficient evidence of a likelihood of consumer confusion to permit its trademark claims to go to trial.
In addition to arguing that Plaintiff cannot prove to have trademark rights in the "Schütz" name, Defendants argue that Plaintiff has failed to put forward sufficient evidence from which a reasonable jury could find a likelihood of consumer confusion. (Defs.' Trademark Mot. for Summ. J., Dkt. [213] at 20-31 of 34.) As a threshold matter, the parties dispute what test should govern the likelihood of confusion analysis. Defendants contend that a seven-factor test should apply; under this test, courts consider the following factors to determine whether there is a likelihood of confusion between two marks:
The "material differences" test is an exception to the "first sale doctrine."
The material differences test is rooted in the Supreme Court decision
The Eleventh Circuit adopted the material differences test in
In reaching this conclusion, the
While the Court suspects that the material differences test is the more appropriate test in this case, for purposes of Defendants' motion, it need not decide this issue. Under either test, the Court finds sufficient evidence from which a reasonable jury could find a likelihood of consumer confusion. First, under Plaintiff's proposed test, the Court finds sufficient evidence that Defendants' cross-bottled IBC is materially different from the Schütz IBC, such that retention of the Schütz mark is likely to cause consumer confusion as to the source of the cross-bottled product.
In this regard, Plaintiff has presented evidence that the two products are structurally different. The Schütz IBC consists of a Schütz outer metal cage and Schütz inner plastic bottle, the latter of which is specifically designed for the Schütz cage. (Pl.'s Consolidated Opp'n, Dkt. [227] at 10 of 60.) The Mauser IBC, on the other hand, consists of a Mauser outer cage and Mauser inner bottle, both of which are of a different design. (
Plaintiff also has presented evidence that Schütz and Defendants subject their products to different performance standards. For example, Schütz has put forward evidence that it tests and certifies its IBCs at 100 kPa of hydrostatic pressure, while Defendants test and certify their cross-bottled products at the lower level of 80 kPa. (
(
The Court also finds that under the seven-factor test, a reasonable jury could conclude that retention of the Schütz mark on Defendants' cross-bottled IBC is likely to cause consumer confusion. With regard to the first factor, strength of the mark, the Court has already found sufficient evidence from which a reasonable jury could find secondary meaning based on the strength of Plaintiff's brand. (
Factors two through five, as set out above, consider the similarity between the infringed and infringing marks (factor 2), the goods offered under the marks (factor 3), and the sales and advertising methods used by the parties with respect to the goods (factors 4 and 5). In this case, the alleged infringed and infringing marks are identical, as Defendants-the alleged infringers-retain Plaintiff's mark on their cross-bottled products. Likewise, the goods sold under the marks are identical, as both parties sell IBCs bearing the Schütz mark. Indeed, Defendants concede that "the marks are identical and that they are both on IBCs. . . ." (Defs.' Trademark Reply, Dkt. [255] at 17 of 22.) Plaintiff has also presented evidence that the parties utilize similar sales and advertising methods and target similar customers, which Defendants do not dispute. (
Factors six and seven, however, are less demonstrative of a likelihood of consumer confusion. With respect to factor six, intent to misappropriate, Plaintiff contends that a reasonable jury easily could infer intent to misappropriate Schütz's goodwill from the fact that Defendants retain the Schütz mark on their products. (Pl.'s Consolidated Opp'n, Dkt. [227] at 32 of 60.) Plaintiff also points to the fact that Defendants often send price quotes to customers referencing Schütz's products. Finally, Plaintiff points to a flyer used by Defendants to advertise the Mauser IBC, which flyer depicts the Mauser IBC next to a genuine Schütz IBC. (
The Court finds this evidence only minimally probative of an intent to misappropriate Plaintiff's goodwill. Because NCG is in the reconditioning business, and because it cross-bottles, it is not surprising that quotes to customers would reference cages manufactured by Schütz or other non-Mauser entities. Similarly, given that the parties are competitors, it is not surprising that Defendants would show a picture of its product next to Plaintiff's to highlight the features it contends make its product more desirable. In short, the evidence cited by Plaintiff is equally indicative of an effort to compete than an effort to trade on Plaintiff's name. Similarly, the Court finds little to no evidence of actual consumer confusion (factor 7). On the contrary, most of the argument in Plaintiff's brief regarding this factor concerns Plaintiff's contention that the material differences test should apply, according to which a likelihood of confusion may be presumed. (Pl.'s Consolidated Opp'n, Dkt. [227] at 34-35 of 60.)
Although Plaintiff has presented only minimal evidence with respect to factors six and seven, the Court nonetheless finds there is sufficient evidence from which a reasonable jury could find a likelihood of consumer confusion. In particular, the trademarks at issue in this case (the "Schütz" name) and the products under which they are sold (IBCs) are both identical, not merely similar. Additionally, the parties market their products through the same channels and to similar customers. Based on this evidence, a jury reasonably could find a likelihood of confusion despite a weaker showing of bad intent or actual confusion. In sum, under either the material differences test or the seven-factor test, Plaintiff has produced sufficient evidence from which a reasonable jury could find a likelihood of consumer confusion.
Defendants argue, on the contrary, that no reasonable consumer could be confused as to the source of the accused cross-bottled IBCs given that NCG places a sticker on the IBCs disclaiming any affiliation with Plaintiff and clearly stating that the IBCs are "remanufactured." (Defs.' Trademark Mot. for Summ. J., Dkt. [213] at 8-9, 20 of 34.) The sticker reads as follows:
(App'x of Ex. to Defs.' Trademark Mot. for Summ. J. ("Defs.' Trademark App'x"), Dkt. [214] Tab P, at 3.) The Court agrees with Defendants that, notwithstanding the Court's likelihood of confusion analysis above, the presence of this sticker on a cross-bottled IBC would preclude any reasonable consumer from claiming confusion as to the source of the IBC. Thus, the Court holds as a matter of law that to the extent NCG's cross-bottled IBCs bear this sticker, no reasonable consumer could be confused as to the IBC's source. By extension, to the extent NCG's cross-bottled IBCs contain this sticker, Plaintiffs' trademark claims necessarily fail. The Court reaches this conclusion in spite of Plaintiff's argument that the dicta in
In
The Court also finds, however, that there is a genuine dispute of material fact regarding the extent to which NCG places this sticker on its cross-bottled IBCs. Plaintiff has presented evidence that NCG does not place the sticker on every cross-bottled IBC that it sells. For example, Plaintiff points to the report of its expert, Dr. Singh, documenting his finding that out of a sample of NCG's cross-bottled IBCs, not every IBC bore the "remanufactured" sticker. (Pl.'s App'x, Dkt. [227] Tab DD, Singh Expert Report at 8 ¶ 12, Table 1 at 9.) Plaintiff also points to the deposition testimony of NCG designee Michael Porreca, in which he stated that NCG does not put the "remanufactured" sticker "on all cross-bottled Mauser bottle — Schütz cage IBCs." (
In sum, the Court has found sufficient evidence of trademark rights in the Schütz name and, to the extent NCG's cross-bottled IBCs do not bear the "remanufactured" label, a likelihood of consumer confusion, such that a reasonable jury could find Defendants liable for trademark infringement under the Lanham Act. Accordingly, Defendants' motion for summary judgment on Plaintiff's Lanham Act false designation of origin claim is
Based on the Court's ruling in Part III.A.,
Defendants Mauser and NCG also move for summary judgment on Plaintiff's false advertising claims, raised in Counts III, IV, V, and VI of the Complaint, and unjust enrichment claim, raised in Count VII. In Count III, Plaintiff raises a federal law claim for false advertising in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B), based on accused statements made by Defendants in connection with the marketing of their crossbottled IBCs. In Counts IV, V, and VI, Plaintiff raises claims under state law based on the same accused false advertising, specifically, for deceptive trade practices under Georgia's UDTPA (Count IV), for fraud under O.C.G.A. § 23-2-55 (Count V), and for common law unfair competition and deceptive trade practices (Count VI).
With respect to the false advertising claims, the parties agree that the federal Lanham Act analysis governs the analysis of the state law claims. (Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J., Dkt. [215] at 8 n.1 of 39 ("Count III of Plaintiff's Complaint is a claim for false advertising under the Lanham Act. State law claims for false advertising are treated the same as a Lanham Act claim. . . . Thus, to the extent Plaintiff is basing its state law claims for deceptive trade practices (Count IV), fraud (Count V), and unfair competition (Count VI) on the accused false advertising, these Counts rise and fall with Count III."); Pl.'s Consolidated Opp'n, Dkt. [227] at 57 n.35 of 60 ("Schütz's Lanham Act claims and Schütz's state law claims are analyzed similarly. . . . Accordingly, Defendants' motion for summary judgment on Schütz's state law claims must fail for the reasons set forth [in connection with the Lanham Act claim].").) Accordingly, resolution of Defendants' motion for summary judgment on Plaintiff's federal law false advertising claim necessarily will resolve the motion as to Plaintiff's state law false advertising claims. The Court first considers Defendants' motion as to the false advertising claims before turning to the claim for unjust enrichment.
As stated in connection with Schütz's motion for summary judgment on NCG's Lanham Act false advertising counterclaim (
Each statement Plaintiff identifies as constituting false advertising makes the same general claim: that Defendants' cross-bottled IBCs are comparable to Schütz's IBCs in terms of overall condition or performance. The fourteen remaining accused statements, Statements 1, 2, 4, 7-9, 11-14, 26-28, and 30,
Defendants move for summary judgment as to these statements on several different grounds. First, Defendants argue that Statements 1, 2, 4, 7-9, and 11-14 are not actionable because they are not contained in a commercial advertising or promotion. (Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J., Dkt. [215] at 12-14 of 39.) Second, Defendants contend that Statements 26-28 and 30 are not actionable because they are neither false nor misleading. (
As stated above, Defendants contend that ten of the accused statements (Statements 1, 2, 4, 7-9, and 11-14) are not actionable as a matter of law because they were not made in "commercial advertising or promotion," as is required under the plain language of Section 43(a) of the Lanham Act. (
The undisputed evidence in this case establishes that Statements 2, 4, and 7-9 were never distributed to customers but rather were used for Defendants' internal purposes only. Statement 2 appears in a document entitled "Stakeholder Engagement Client Feedback Mauser Sustainability." (Defs.' False Advertising & Unjust Enrichment SMF, Dkt. [216] ¶ 29.) This document is a summary of client interviews that was created by a consulting firm (the "BEOC Group") for executives of Mauser and NCG. (
Plaintiff Schütz concedes that the statements specifically identified as Statements 2, 4, and 7-9 were never disseminated to customers. (Pl.'s Response to Defs.' False Advertising & Unjust Enrichment SMF, Dkt. [229] ¶¶ 32, 36, 46.) However, Plaintiff argues that fact to be immaterial on grounds that similar statements have been disseminated to customers as part of a broader campaign to convince purchasers that cross-bottled products perform as well as the Schütz product. (Pl.'s Consolidated Opp'n, Dkt. [227] at 43-45 of 60.) In other words, Plaintiff argues that while the specifically identified statements were never distributed to customers, they are illustrative of-and embody the same message contained in-statements that Defendants routinely disseminate to customers as part of their market strategy of persuading customers that crossbottled IBCs are of the same quality and perform to the same standard as the Schütz IBC. (
In support of this argument, Plaintiff points to the deposition testimony of NCG and/ or Mauser representatives (Kathryn Graue, John C. Smyth, and T.J. Janowski), in which Defendants purportedly admit that the substance of the identified statements is communicated to customers. (
(Pl.'s App'x, Dkt. [227] Tab F, 11/5/10 Dep. of NCG (Kathryn Graue, Designee), at 156:14-20.) Plaintiff also relies on the following testimony of John Smyth:
(
The Court finds Plaintiff's argument to be of no avail. To prevail on a Lanham Act false advertising claim, a claimant must prove that the accused statement was made in "commercial advertising or promotion." As stated above, Plaintiff concedes that the specifically identified statements (Statements 2, 4, and 7-9) were never disseminated to customers; Plaintiff nonetheless contends that the "commercial advertising or promotion" requirement is satisfied by deposition testimony that statements similar to those specifically identified are disseminated to customers. However, testimony that a general message is or has been conveyed to unspecified customers, at an unspecified time, in an unspecified manner, and by unspecified persons is insufficient to satisfy the threshold requirement of a Lanham Act claim-that the accused statements were made in "commercial advertising or promotion." Having failed to show that accused Statements 2, 4, or 7-9 were disseminated to customers, no reasonable jury could find them to have been made in "commercial advertising or promotion." The fact that similar messages may have been conveyed to an unidentified number of consumers at an unidentified time and in an unidentified manner does not change this result.
Defendants argue that Statement 1 is not actionable as a matter of law because it was distributed only to Defendants' customers in Europe and not to a single customer in the United States. (Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J., Dkt. [215] at 13 of 39.) Statement 1 is contained in a letter signed by Mauser/ NCG representatives Siegfried Weber and Jorg Fassbender. (App'x of Ex. to Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J. ("Defs.' False Advertising & Unjust Enrichment App'x"), Dkt. [216] Tab Y.) Plaintiff disputes that this statement was sent only to European customers and argues that it was likewise distributed to customers in the United States. (Pl.'s Response to Defs.' False Advertising & Unjust Enrichment SMF, Dkt. [229] ¶ 28; Pl.'s Consolidated Statement of Additional Facts in Response to Defs. Mots. for Summ. J. ("Pl.'s Consolidated SAF"), Dkt. 230 ¶ 61 ("The letter containing [accused Statement 1] has been sent to customers that purchase products in the United States.").) Plaintiff does not elaborate, however, regarding to whom, by whom, or when this letter allegedly was so disseminated.
Defendants argue that Statements 11-14 are not actionable as a matter of law because they were not sufficiently disseminated to constitute "commercial advertising or promotion," as each was disseminated only to one or two of Defendants' U.S. customers. (
Statement 14 is contained in a presentation entitled "Mauser Eco-Cycle." (
To resolve Defendants' motion for summary judgment with respect to these statements, the Court must consider the meaning of "commercial advertising or promotion" under the Lanham Act. The Act does not define the phrase "commercial advertising or promotion," nor does its legislative history shed any light on the phrase's meaning.
Under this test, a statement constitutes "commercial advertising or promotion" if it is: "(1) commercial speech; (2) by a defendant who is in commercial competition with plaintiff; (3) for the purpose of influencing customers to buy defendant's goods and services"; and "(4) . . . disseminated sufficiently to the relevant purchasing public to constitute `advertising' or promotion' within that industry."
Applying the test to the facts of this case, the Court need only determine whether Statements 1 and 11-14 satisfy the fourth prong, as Defendants move for summary judgment only on grounds that the statements were not sufficiently disseminated to the purchasing public to constitute "advertising" or "promotion" under the Lanham Act. (Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J., Dkt. [215] at 13-14 of 39.) To be "sufficiently disseminated" to constitute "commercial advertising or promotion," the accused statement must be "designed to disseminate information to the public" as part of an "organized campaign to penetrate the relevant market."
At the same time, however, courts have recognized that "the level of circulation required to constitute advertising and promotion will undeniably vary from industry to industry and from case to case."
The Court finds that Plaintiff has failed to present sufficient evidence from which a jury reasonably could find accused Statements 1 and 11-14 to have been sufficiently disseminated to consumers to constitute "commercial advertising or promotion." The evidence shows that Statements 11-13 were disseminated to only one customer, that Statement 14 was made in a presentation given to only two, and that Statement 1 was distributed only to customers in Europe.
With respect to the remaining statements, Statements 26, 27, 28, and 30, Defendants seek summary judgment on grounds that the statements are not false or misleading. (Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J., Dkt. [215] at 17-26 of 39.) Plaintiff contends that these statements are literally false, rather than misleading. The Court thus must determine whether Plaintiff has presented sufficient evidence from which a reasonable jury could find the statements to be false. As stated in Part II.A.,
Statements 26, 27, and 28, although worded differently, each makes the same general claim: that Defendants restore used IBCs to their "original" conditions or performance standards. Specifically, accused Statement 26 reads "restoring the container to its original condition." (Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J., Ex. 1, Dkt. [215] at 38 of 39.) Accused Statement 27 reads, "We clean it [container] completely, conduct thorough inspections, and replace worn closures, thus restoring the container to its original condition. So you can depend on getting exactly the performance and quality you bargained for."
Plaintiff contends that Statements 26, 27, and 28 "plainly and literally claim" that NCG restores its products to their original conditions and original performance standards-which claims are literally false with respect to crossbottled IBCs. (Pl.'s Consolidated Opp'n, Dkt. [227] at 46 of 60.) Defendants contend, however, that Plaintiff cannot prove these statements to be literally false because the statements never refer to cross-bottled IBCs. (Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J., Dkt. [215] at 19-21 of 39.) That is, because Plaintiff's theory of literal falsity concerns only the meaning of the statements as applied to cross-bottled products, and because the statements do not mention cross-bottled products, Defendants contend the statements cannot be found to be literally false. (
The Court finds Defendant's argument-which appears to be a sort of ambiguity argument-to be of no avail. Contrary to Defendants' argument, the statements need not explicitly reference cross-bottled products to be found literally false with respect to them. The statements unambigously assert that NCG restores all of its products to their original condition when it reconditions them. This would include cross-bottled products. The only question for the Court is therefore whether Plaintiff has presented sufficient evidence from which a reasonable jury could find these assertions to be literally false as applied to the cross-bottled product at issue in this case.
As stated above, Statements 26 and 27 appear in an NCG brochure entitled, "National Container Group: Maximizing Value Through Reconditioning." (Defs.' False Advertising & Unjust Enrichment App'x, Dkt. [216] Tab QQ.) The entire brochure is dedicated to promoting the reconditioning business. It extolls the benefits of reconditioning in terms of cost savings to the consumer and reduction of environmental waste. The brochure does not specifically reference cross-bottled products (or Plaintiff) but instead refers to Defendants' reconditioned IBCs, generally.
For example, under the heading "Wasting less and saving more," the brochure reads, "[C]onsider saving money by not spending it on new containers when they aren't needed. [NCG] . . . helps you spend less-often much less-when you can use reconditioned containers instead." Elsewhere the brochure claims, "Our industry is intrinsically good for the environment. After all, instead of discarding containers, we clean them, inspect them, test them, refurbish them, wherever necessary and offer them for re-use." The paragraph in which accused Statement 27 appears reads in full, "NCG checks every container under pressure with new ultrasonic technology. We clean it completely, conduct thorough inspections, and replace worn closures, thus restoring the container to its original condition. So you can depend on getting exactly the performance and quality you bargained for."
Plaintiff contends that the "original condition" assertion in Statement 26/ 27 is literally false with respect to cross-bottled IBCs because when NCG replaces the Schütz bottle with a Mauser bottle, the resulting product is materially different from and not restored to the original condition of a Schütz/ Schütz IBC. (Pl's Consolidated Opp'n, Dkt. [227] at 46-47 of 60.) Plaintiff elaborates: "NCG could, if it wished, recondition Schütz IBCs by replacing the used Schütz bottle with an identical replacement Schütz bottle. Such bottles are available, but NCG chooses not to buy them. Instead, it uses a Mauser bottle that was not designed for a Mauser cage. . . ." (
In support of its argument that the cross-bottled IBC is materially different and therefore not restored to the original condition of a Schütz IBC, Plaintiff presents evidence that the Schütz IBC and cross-bottled IBC are of a different design. As discussed in Part III.A.2.,
When this bottle is placed inside a Schütz cage, however, the indentations do not match up with the bars of the cage. (Pl.'s App'x, Dkt. [227] Tab D, 11/4/2010 Dep. of National Container Group (Michael Porreca, Designee), at 23:25-24:16; Tab DD, Am. Expert Report of Sher Paul Singh, PhD., j[ 33.) Thus, when Defendants take a Schütz IBC and replace the Schütz bottle with a Mauser bottle, the resulting IBC is of a different design and cannot be said to have been restored to its original condition. (
The Court finds that Plaintiff has produced sufficient evidence from which a reasonable jury could find Statements 26 and 27 to be literally false. That is, based on the evidence described above, a reasonable jury could find that Defendants do not restore cross-bottled IBCs to their original conditions. Defendants are thus not entitled to summary judgment as to Statement 26/ 27 on grounds that they cannot be proven to be false.
With respect to the "original performance" assertions found in Statements 27 and 28, Plaintiff argues literal falsity on grounds that NCG's cross-bottled IBCs do not perform as well as the Schütz IBC-the original product. (Pl.'s Consolidated Opp'n, Dkt. [227] at 47 of 60.) In support of this argument, Plaintiff points to the expert report of Dr. Sher Paul Singh. (
The Court finds this evidence sufficient to create an issue of material fact as to whether Defendants' cross-bottled IBCs can, in fact, be restored to their original performance standards. Because a reasonable jury could find-based on this evidence-that cross-bottled IBCs do not perform at the same level as an original Schütz/ Schütz IBC, Defendants are not entitled to summary judgment as to Statements 27 and 28 on grounds that they cannot be proven to be false.
Finally, the Court must consider Statement 30. Statement 30 reads, "We Offer: 275 & 330 New bottle and Reconditioned Totes," "White (UV Protection) Bottles / EPA One-way Valves / 3" Valve / Part Sales." (Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J., Ex. 1, Dkt. [215] at 38 of 39.) This statement appears on a flyer below side-by-side pictures of a Mauser IBC and Schütz IBC. (Defs.' False Advertising & Unjust Enrichment SMF, Dkt. [216] ¶ 127.) Defendants' business logos appear in the top left corner of the flyer, which reads at the top, "Announcing our competitive advantage! Mauser Manufactures Bottles on the West Coast!" (Pl.'s App'x, Dkt. [227], Tab N, Ex. 84.) The Court finds that Plaintiff has failed to produce any evidence that this statement is literally false. Indeed, Plaintiff has failed to raise a single argument in its brief as to why Statement 30, in particular, could be found to be literally false.
Finally, with respect to each accused statement, Defendants seek summary judgment on the added ground that Plaintiff cannot prove "injury and a causal link between the injury and the [accused statements]," which Defendants contend is an essential element in proving liability for false advertising. (Defs.' False Advertising & Unjust Enrichment Mot. for Summ. J., Dkt. [215] at 26-27 of 39.) Plaintiff, on the other hand, argues that a showing of actual injury is not required to establish liability under the Lanham Act. (Pl.'s Consolidated Opp'n, Dkt. [227] at 53-55 of 60.) The Court agrees with Plaintiff and finds that Plaintiff is not required to prove actual injury to prevail on its false advertising claim.
As stated earlier and throughout this Order, the Lanham Act creates a cause of action for a person who "is or is likely to be damaged" by false advertising. 15 U.S.C. § 1125(a)(1)(B). The well-settled elements of the claim, as set forth elsewhere in this Order, are that:
In accordance with the foregoing, Defendants' motion for summary judgment on Plaintiff's Lanham Act false advertising claim (Count III) is
In accordance with the Court's ruling in Part IV.A., supra, Defendants' motion for summary judgment on Plaintiff's state law trademark claims (Counts IV-VI) is
Finally, Defendants move for summary judgment on Plaintiff's claim for unjust enrichment. In the unjust enrichment count of Plaintiff's Complaint (Count VII), Plaintiff alleges that "Defendants' direct and contributory actions in the advertising, marketing, promotion and sale of their goods . . . have been conducted with the purpose and effect of deriving unjust benefit from deceiving and misleading the public as to the nature, character and origin of Defendants' products." (Compl., Dkt. [1] ¶ 54.)
Under Georgia law, "[t]he theory of unjust enrichment applies when there is no legal contract and when there has been a benefit conferred which would result in an unjust enrichment unless compensated."
The Court finds that issues of material fact preclude summary judgment on Plaintiff's unjust enrichment claim. As set forth in detail above, the Record contains evidence supporting Plaintiff's claims for trademark infringement and false advertising. There is also evidence that Defendants benefitted from this alleged wrongdoing in the form of increased customer accounts and sales. (Pl.'s Consolidated SAF, Dkt. [230] ¶¶ 63, 64.) In other words, there is evidence that Defendants received a benefit from their unauthorized use of Plaintiff's trademark. Finally, a jury reasonably could conclude that failure to compensate for this benefit would be unjust. Accordingly, the Court finds issues of material fact precluding Defendants' motion for summary judgment on Plaintiff's unjust enrichment claim. The motion is accordingly
In accordance with the foregoing, Plaintiff's Motion for Leave to File Surreply in Opposition to Defendants' Motion for Summary Judgment
Finally, Defendant Mauser Corporation and National Container Group, LLC's Motion for Summary Judgment on Plaintiff's False Advertising Claims (Counts III-VI) and Unjust Enrichment Claim (Count VII)
709 F. Supp. at 1582 (citations omitted).