Bausch & Lomb Inc. v. Alcide Corp.

• Decision Date: 24 November 1987
• Docket Number: No. CIV-87-1159T.,CIV-87-1159T.
• Citation: 684 F. Supp. 1155
• Parties: BAUSCH & LOMB INCORPORATED, Plaintiff, v. ALCIDE CORPORATION, Defendant.
• Court: U.S. District Court — Western District of New York

684 F. Supp. 1155

BAUSCH & LOMB INCORPORATED, Plaintiff, v. ALCIDE CORPORATION, Defendant.

No. CIV-87-1159T.

United States District Court, W.D. New York.

November 24, 1987.

Nixon, Hargrave, Devans & Doyle (William D. Eggers and Kathleen Tranelli, of counsel), Rochester, N.Y., for plaintiff.

Seed & Berry (Jeffrey B. Oster, of counsel), Seattle, Wash., and Harris, Beach, Wilcox, Rubin & Levey (James Hartman, of counsel), Rochester, N.Y., for defendant.

DECISION AND ORDER

TELESCA, District Judge.

The plaintiff in this action, Bausch & Lomb Incorporated, is a major manufacturer of soft contact lenses and various cleaning and preparation solutions used in connection with soft contact lenses. The defendant, Alcide Corporation, is a manufacturer of disinfectant solutions used in the medical, agricultural, veterinary, automotive, and food industries. Bausch & Lomb filed this declaratory judgment action on September 3, 1987 seeking a declaration that the use of the trademark "ReNu" does not infringe upon Alcide's trademark "RenNew." On September 9, 1987, Alcide filed an action in the District of Connecticut for trademark infringement alleging that Bausch & Lomb's use of the name ReNu on its soft contact lense disinfectant solution infringed upon Alcide's registered trademark "RenNew."

Bausch & Lomb has moved to enjoin Alcide from prosecuting the Connecticut action. Alcide has moved to have this action stayed or in the alternative, transferred to the District of Connecticut.

BACKGROUND

In July of 1984, Alcide filed a trademark application for the mark "RenNew" for use on a disinfectant solution. In June of 1985, Alcide began marketing disinfectant solution for renal dialysis machines under the trademark "RenNew-D". Although the product had received the approval of the United States Food & Drug Administration, in June of 1986 Alcide learned of reports of the appearance of pinholes in the semipermeable membranes of the hemodialyzers. Alcide withdrew the product from the market in order to conduct further research with an aim toward returning the product to the market as soon as possible. Alcide contends that the RenNew hemodialysis disinfectant product will be back on the market in 1988. In November of 1986, the Patent and Trademark Office issued a registration for "RenNew" as a trademark for use identifying a "sporacide/disinfectant for hemodialyzers."

The parties are in dispute as to the extent to which Alcide uses the name RenNew for disinfectant solutions with uses other than renal dialysis. Alcide contends that it produces RenNew-M for its disinfectant solution for medical equipment and RenNew-A/C for its disinfectant solution for automobile air-conditioning systems. Bausch & Lomb has produced Alcide's 1987 Technology Profile, its 1987 Annual Report, an agreement between Alcide and Ford Motor Company for the marketing of Alcide's disinfectant for automotive air-conditioning systems. Bausch & Lomb contends that these documents reveal that Alcide is not currently using the name RenNew on any product.

Bausch & Lomb and Alcide have been parties for a number of years in ongoing discussions regarding Alcide's research and development of a contact lense disinfecting solution. In December of 1983, they entered into a confidential disclosure agreement whereby Alcide sent samples of its contact lense disinfecting solution to Bausch & Lomb for testing. In August of 1986, they entered into a formal agreement for Alcide to develop a contact lense disinfecting solution to be exclusively distributed by Bausch & Lomb. The contract called for payments by Bausch & Lomb at various stages of development and testing and for Bausch & Lomb to pay to Alcide a percentage of sales once the product is marketed. The agreement calls for the disinfectant to be marketed under Bausch & Lomb's name but also to contain the Alcide name. The agreement is silent as to either parties' use of the names ReNu or RenNew.

In December of 1986, Bausch & Lomb began marketing an enzymatic contact lense cleaning solution under the tradename "ReNu". The active ingredient in the disinfectant is the proteolytic enzyme subtilisin which removes protein buildup from contact lenses. It does not also disinfect the contact lense.

Alcide contacted Bausch & Lomb to express its concern over the use of "ReNu". Bausch & Lomb pointed out the fact that the Patent and Trademark Office classifies enzymatic cleaning solutions differently from disinfecting solutions and the unlikelihood of confusion between the retail contact lense market and the sale to hospitals of renal dialysis disinfecting solutions. Alcide assessed that it was not likely to get into the business of producing enzymatic cleaning solutions and, therefore, did not oppose further Bausch & Lomb's use of "ReNu" at that time.

In June of 1987, Bausch & Lomb introduced two new contact lense products under the tradename ReNu, a saline solution and a disinfecting solution. Alcide alleges that it knew of the proposed announcement in advance and that during May of 1987 it contacted Bausch & Lomb to protest the use of the name ReNu on the disinfecting solution. Alcide also alleges that on June 2, after Bausch & Lomb's announcement of the new product, it received at least four phone calls from stockbrokers inquiring whether the newly announced Bausch & Lomb disinfecting solution was an Alcide product.

In July and August of 1987, the parties engaged in a series of telephone calls, letter correspondence and at least one meeting regarding Bausch & Lomb's use of the name "ReNu" on its disinfectant solution and Alcide's claim of infringement on its "RenNew" disinfectant solution. How to characterize this communication between the parties is an important issue going to the question of the good faith efforts of the parties to resolve this commercial dispute. Bausch & Lomb contends that it made clear to Alcide that it did not consider its use of the name "ReNu" to infringe upon their trademark and that it would not agree to pay any royalties to Alcide. Alcide contends that Bausch & Lomb had left the door open to consideration of further proposals for resolution of the dispute to be advanced by Alcide.

On August 28, 1987, Elliott J. Siff, President and Chief Executive Officer of Alcide, sent a letter to James E. Kanaley, Head of the Personal Products Division of Bausch & Lomb which stated, inter alia,

Bob Abrahams has just received word from Jim Doyle informing us of your decision to do nothing further regarding the conflict of the above-referenced trademarks.... As we understand it, your ReNu disinfectant will be coming out shortly, and we must resolve our differences promptly. I sincerely hope that you will reconsider your position before the close of business on Thursday, September 3, 1987; otherwise Alcide Corporation will have no choice but to file a complaint seeking a preliminary injunction and other relief to protect its rights and its registered trademark RenNew Disinfectant.

On September 3, 1987, Bausch & Lomb filed the instant declaratory judgment action. Alcide filed its action in Connecticut for trademark infringement on September 9, 1987.

DISCUSSION

Bausch & Lomb seeks a preliminary injunction enjoining Alcide from prosecuting the Connecticut action any further. Alcide seeks an order staying this action or in the alternative, transferring it to the District of Connecticut to be joined with the trademark infringement action it filed there.

Where an action is brought in one Federal District Court and a later action embracing the same issue is brought in another Federal Court, the first action has jurisdiction to enjoin the prosecution of the second action. See, Coakley & Booth, Inc. v. Baltimore Contractors, Inc., 367 F.2d 151 (2d Cir.1966); National Equipment Rental, Ltd. v. Fowler, 287 F.2d 43 (2d Cir.1961).

Meeropol v. Nizer, 505 F.2d 232, 235 (2d Cir.1974).

This power to enjoin exists even when the first action is a declaratory judgment action and the second one is an action for damages for an alleged injury, as long as the declaratory judgment action "will serve a useful purpose of clarifying and settling the legal relations in issue, and ... when it will terminate and afford relief from the uncertainty, insecurity, and controversy giving rise to the proceedings." Ft. Howard Paper Company v. William D. Witter, Inc., 787 F.2d 784, 790 (2d Cir.1986) (quoting E. Borchard, Declaratory Judgments, 299 (2d Ed. 1941)).

Accordingly, the first issue to be determined is whether the Connecticut action is one "embracing the same issue" as the declaratory judgment brought in this Court. While the two actions need not be identical, ...