The opinion of the court was delivered by: SCHEINDLIN
SHIRA A. SCHEINDLIN, U.S.D.J.
Plaintiffs Black & Decker Corporation and Black & Decker (U.S.) Inc. ("Black & Decker" or "plaintiff") have moved for summary judgment on Counts I, II and III of their Complaint
and Counts I, III and IV of Defendants' Counterclaim.
Black & Decker seeks summary judgment on the ground that the name "Snakelight" as used by Defendants Michael Dunsford ("Dunsford") and M.D. Enterprises, Inc. ("M.D.") is not protectible as a matter of law. Because Defendants' mark is a descriptive mark without secondary meaning, the motion is granted.
In July 1989, Dunsford developed a flexible lighting apparatus to highlight the art to be shown in an upcoming exhibition at his furniture store/art gallery in San Diego, California. He named the fixture "Snakelight."
Defendants' Amended Answer and Counterclaim ("Am. Answer") at 7. Because the lighting devices received almost as much attention as the art at the exhibition, Dunsford began to manufacture more of the lights and offer them for sale through his business. Id. The first retail sale of Dunsford's "Snakelight" product occurred on July 8, 1989, in San Diego. Id. Ex. B. Dunsford manufactured and sold his products on a part-time basis for the next several years. Deposition of Michael Dunsford ("Dunsford Dep."), September 20, 1995, at 105. After three and a half years of producing "Snakelights," Dunsford had earned sales revenues of approximately $ 47,000. Affidavit of John F. Delaney, Attorney for Plaintiffs ("Delaney Aff."), Ex. 5 at 4.
During roughly the same time period, Black & Decker began to develop a new household flashlight which, because of its flexible handle, could be used "hands-free" by coiling or bending the handle, or wrapping it around a fixed object. Dinan Aff., Ex. 19. In November 1992, Black & Decker hired two law firms to conduct a trademark search for the name "SnakeLite." Complaint ("Cplt."), Exs. G and H. Searches were made of federal registrations, state trademarks, business and trademark directories and foreign registrations and directories. Cplt. P 29. No reference was found to any prior use of the name, and Black & Decker was advised that the mark was available for use and registration. Id.
Black & Decker also conducted searches for the names "FlexLite" and "FlexLight." Dinan Aff., Ex. 20. However, the name "SnakeLite" was favored by David R. Stone, president of Black & Decker's household products division. Deposition of David R. Stone, January 12, 1996, at 14, 17-18, 29. As a result, Black & Decker applied for a trademark registration in the United States Patent and Trademark Office ("the PTO") on December 8, 1992, based on its intent to use the name "SnakeLite." Cplt. Ex. I. The application was published for opposition on April 27, 1993 and formally approved by the PTO on July 20, 1993. Id., Ex. J. More than a year later, on August 26, 1994, Black & Decker filed its Statement of Use, requesting registration of the mark "SnakeLight," rather than the phonetic equivalent "SnakeLite." Id., Ex. K.
After investing more than $ 4 million to develop the flexible flashlight, Black & Decker introduced its SnakeLight to the public in the summer of 1994.
Id. P 14. The product was extremely successful from the start. An article in the December 22, 1994 edition of USA Today called the flashlight "perhaps the biggest hit of the holiday season." Id. Ex. E. Black & Decker's SnakeLight was selected by Popular Science magazine as one of 1994's 100 greatest achievements in science and technology. Cplt., Ex. B. It was also selected by Popular Mechanics for a 1995 design and engineering award. Id., Ex. C. Black & Decker spent over $ 2 million advertising the SnakeLight during the first seven months after the product's introduction, and planned to spend $ 10 million for advertising in 1995.
Id. P 21.
Defendants first learned of Black & Decker's product in November 1994. Am. Answer, P 20. By this time, Dunsford had achieved a total of $ 80,000 in gross sales of his "Snakelight" product, which he had begun manufacturing in 1989. Dunsford Dep. at 20. Prior to October 1994, Defendants had spent no money for advertising. Id. at 48. Between October 1994 and April 1995, Dunsford spent approximately $ 3,000 on advertising. Delaney Aff., Ex. 17. Since the introduction of Black & Decker's SnakeLight flashlight, Dunsford's Snakelight business has "greatly improved." Dunsford Dep. at 107.
Nevertheless, on February 7, 1995, Black & Decker received a letter from Defendants' counsel, stating his belief that Black & Decker's use of the name "SnakeLight" was an infringement of Dunsford's rights. Cplt., Ex. A. The letter stated that Dunsford intended to file a cancellation of Black & Decker's mark, to file an application with the PTO to register Dunsford's mark, and to file suit seeking equitable and monetary relief from Black & Decker. Id. at 2. Believing it was about to be sued, Black & Decker filed this action on February 23, 1995, seeking a declaration of its rights in its registered trademark "SnakeLight."
After this lawsuit was filed on February 23, 1995, Dunsford filed suit against Black & Decker on March 3, 1995 in the U.S. District Court for the District of Maryland. Two weeks later, on March 20, 1995, Dunsford moved to dismiss this lawsuit for lack of personal jurisdiction, for improper venue, and for forum non conveniens. On May 4, 1995, the parties agreed that in order to conserve resources, their dispute would proceed in this forum only. Consequently, Dunsford filed a Notice of Dismissal with the Maryland court, and the Motion to Dismiss this suit was withdrawn on August 2, 1995.
Meanwhile, Dunsford filed an Answer and Counterclaim on May 25, 1995. Defendant M.D. Enterprises, Inc., a corporation formed by Dunsford and wholly owned by him, was allowed to intervene pursuant to an order dated December 21, 1995. Black & Decker moved for summary judgment on March 7, 1996.
On March 13, 1996, Defendants were granted leave to amend their Answer and Counterclaim. The Amended Answer was filed on April 1, 1996, followed by Black & Decker's reply on April 17, 1996. Pursuant to a June 25, 1996, telephone conference, both parties were ordered to submit supplemental briefs on the issue of judicial admissions made by Dunsford and his attorneys in his Maryland Complaint and in the original Answer in this action. The parties submitted the supplemental briefs on July 2, 1996. In addition, pursuant to a telephone conference on July 16, the parties were asked to submit supplemental briefs on the issue of secondary meaning by July 25, 1996. All briefs have now been submitted.
Summary judgment will be granted only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). The burden of demonstrating that no factual dispute exists rests on the party seeking summary judgment. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 26 L. Ed. 2d 142, 90 S. Ct. 1598 (1970).
The movant's burden "may be discharged by 'showing' -- that is, pointing out to the district court--that there is an absence of evidence to support the nonmoving party's case." Celotex, 477 U.S. at 325. Once this burden is met, the nonmoving party must "go beyond the pleadings," by pointing out factual evidence showing that there are, in fact, genuine issues for trial. Id. at 324. Rule 56(c) "mandates the entry of summary judgment . . . against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Id. at 322. The ...