Alfa Laval Inc. v. Flowtrend, Inc.
| Decision Date | 09 May 2016 |
| Docket Number | CIVIL ACTION NO. H-14-2597 |
| Parties | ALFA LAVAL INC., Plaintiff, v. FLOWTREND, INC., et. al., Defendants. |
| Court | U.S. District Court — Southern District of Texas |
This case is before the Court on the Motion for Partial Summary Judgment [Doc. # 56] filed by Plaintiff Alfa Laval, Inc. ("Alfa Laval"), to which Defendants Flowtrend, Inc. ("Flowtrend"), Joseph Allman, Jan Hansen and Steven Stovall filed a Response [Doc. # 63], and Plaintiff filed a Reply [Doc. # 71]. Also pending is Defendants' Motion for Summary Judgment [Doc. # 59], to which Plaintiff filed an Opposition [Doc. # 66], and Defendants filed a Reply [Doc. # 67].
Defendants filed a Motion to Exclude the Expert Testimony of Lyle W. Clem ("Clem Motion") [Doc. # 54], to which Plaintiff filed an Opposition [Doc. # 65], and Defendants filed a Reply [Doc. # 70]. Defendants also filed a Motion to Exclude the Expert Testimony of Robert Dumke ("Dumke Motion") [Doc. # 55], to which Plaintiff filed an Opposition [Doc. # 64], and Defendants filed a Reply [Doc. # 68]. Plaintiff filed a Motion to Exclude Expert Witness Joseph Allman ("Allman Motion") [Doc. # 57], to which Defendants filed a Response [Doc. # 62], and Plaintiff filed a Reply [Doc. #69].
Having reviewed the record and the applicable legal authorities, the Court grants in part and denies without prejudice in part the motions to exclude experts. The Court grants Defendants' Motion for Summary Judgment as to the Copyright Act claim, and denies Defendants' Motion for Summary Judgment in all other respects. The Court denies Plaintiff's Motion for Partial Summary Judgment.
Alfa Laval supplies machinery and equipment, including pumps, valves, fittings, and tank equipment, for use in the food processing, pharmaceutical, and other industries that require high sanitary standards. Alfa Laval also sells Original Equipment Manufacturer ("OEM") replacement parts for its machinery and equipment.
Flowtrend sells aftermarket non-OEM replacement parts, including parts for Alfa Laval equipment and machinery.1 Indeed, Flowtrend sells approximately 9,500 types of replacement parts for Alfa Laval products. Flowtrend identifies its parts as replacements for Alfa Laval equipment and machinery using the Alfa Laval names and designations. Flowtrend states in its advertising, inter alia, that "a majority of[Flowtrend's] products are identical to their name brand counterparts," that its replacement parts are interchangeable with Alfa Laval parts, are just like OEM parts, and meet or exceed OEM specifications. Plaintiff alleges that this constitutes false advertising, and that Flowtrend infringes the Alfa Laval trade dress and engages in unfair competition in violation of the Lanham Act.
Alfa Laval alleges that it has a registered copyright in certain product brochures and manuals (the "Copyrighted Materials"). Plaintiff alleges that Defendants violated the Copyright Act by posting these Copyrighted Materials on the Flowtrend website.
Plaintiff filed this lawsuit on September 9, 2014, asserting a Lanham Act claim for trade dress infringement, unfair competition, and false advertising. Plaintiff also asserted a Copyright Act claim, and Texas state law causes of action for tortious interference with prospective business relations, unfair competition, and unjust enrichment. On November 17, 2014, Plaintiff filed a First Amended Complaint [Doc. # 29], on August 14, 2015, Plaintiff filed a Second Amended Complaint [Doc. # 42], and on September 15, 2015, Plaintiff filed a Third Amended Complaint [Doc. # 46]. In the Third Amended Complaint, Plaintiff abandoned its unjust enrichment claim. Plaintiff later withdrew its tortious interference claim. The remaining claims are the Lanham Act claim, the Copyright Act claim, and the Texas law unfair competition claim.
Plaintiff and Defendants have filed motions challenging the other party's experts. Plaintiff and Defendants also filed motions seeking summary judgment on some but not all claims. The motions have been fully briefed and are now ripe for decision.2
Defendants ask the Court to exclude testimony from Plaintiff's experts Lyle W. Clem and Robert Dumke.3 Plaintiff asks the Court to exclude Joseph Allman as an expert witness for Defendants. The Court has carefully reviewed the experts' opinions,4 the parties' briefing, and the applicable legal authorities. Based on that review, the Court rules that the three expert witnesses may testify as to certain matters but not others. To the extent the Court does not address a specific proffered opinion, testimony regarding that opinion may be offered at trial subject to cross-examination.
Certain witnesses are permitted under the Federal Rules of Evidence to give opinions. "A witness who is qualified as an expert by knowledge, skill, experience, training or education may testify in the form of an opinion or otherwise" if his testimony will assist the trier of fact, has an adequate factual basis, and is the result of reliable principles and methods that the expert has reliably applied to the facts of the case. See FED. R. EVID. 702. In ruling on a motion to exclude an expert's testimony, the Court functions as a gate keeper and permits expert testimony only if it is reliable and relevant. See Wellogix, Inc. v. Accenture, L.L.P., 716 F.3d 867, 881 (5th Cir. 2013). The reliability inquiry is a "flexible" one, and the Court has "broad latitude when [deciding] how to determine reliability and in the reliability determination" itself. In re MBS Mgmt. Servs., Inc., 690 F.3d 352, 357 (5th Cir. 2012) (quoting Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137, 141-42 (1999)).
"In rulings on the admissibility of expert opinion evidence the trial court has broad discretion . . .." Wellogix, 716 F.3d at 881. "Vigorous cross-examination, presentation of contrary evidence, and careful instruction on the burden of proof are the traditional and appropriate means of attacking shaky but admissible evidence." Id. (quoting Pipitone v. Biomatrix, Inc., 288 F.3d 239, 250 (5th Cir. 2002) (quoting Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 596 (1993))).
Lyle W. Clem has 35 years experience as a designer of processing systems and facilities in the food, pharmaceutical, dairy, beverage, and biotechnology industries. In August 2015, he examined the following several items: an Alfa Laval Model 761 valve, a cutaway example of an Alfa Laval Model 761 valve actuator, and two Flowtrend valves that are marketed as replacements for the Model 761 valve. Based on his examination, including his observation that the Alfa Laval valves contained two concentric springs and the Flowtrend valves he examined contained a single spring, Clem opines that "the parts and devices supplied by Flowtrend" are not identical to the corresponding Alfa Laval parts. Clem opines further that, although the Flowtrend valves are physically interchangeable, Flowtrend's parts are not "interchangeable parts" because they lack "cleanability" features.
Clem clearly has the experience required to compare the Alfa Laval Model 761 valves with the corresponding Flowtrend valves and to express an opinion regarding the comparison of the specific valves he examined.5 It is undisputed, however, that Clem did not examine any of the other approximately 9,500 replacement part models sold by Flowtrend and, as a result, would not be able to provide testimony regardingany other type replacement part. The request to exclude his testimony regarding products other than the Model 761 valve is granted.
Clem also seeks to opine that Flowtrend's packaging, including the use of bright green, "is clearly indicative" of Flowtrend's intent to deceive. There is no evidence that Clem has the necessary training or experience that would enable him to express an opinion regarding Flowtrend's state of mind. In the Response to the Clem Motion, Plaintiff argues for the first time that Clem is offered as a fact witness pursuant to Rule 701 of the Federal Rules of Evidence to opine that the color green or the letters "AL" on a product or packaging "leads a customer to believe" it is an Alfa Laval product. Rule 701 permits a lay witness to present opinion testimony if the opinion is "(a) rationally based on the witness's perception; (b) helpful to clearly understanding the witness's testimony or to determining a fact in issue; and (3) not based on scientific, technical or other specialized knowledge within the scope of Rule 702." See FED. R. EVID. 701. Plaintiff argues that Clem's opinions are based on his own experiences. Clem's personal experience with the use of the color green is not relevant in this case because there is no evidence that Clem's experiences were as a purchaser or consumer of Alfa Laval parts. Plaintiff argues that Clem's proffered opinion will assist the jury because "jurors do not purchase sanitary valves and components." See Opposition [Doc. # 65], p. 3. There is no evidence, however, thatClem has experience purchasing sanitary valves and components. As a result, the Motion to Exclude Clem's testimony regarding Flowtrend's intent is granted.
Clem also seeks to opine regarding whether Flowtrend replacement parts comply with certain sanitary standards. This opinion, which relates to established sanitary standards and not to "OEM standards" to which Flowtrend referred in its advertising, is not relevant to any issue in this lawsuit. As a result, the Motion to Exclude Clem's testimony regarding sanitary standards is granted.
Robert Dumke is the current Operations Manager, USA, for Alfa Laval. Plaintiff expects Dumke to offer the opinion that Flowtrend parts are neither identical to nor interchangeable with Alfa Laval parts. It is undisputed that Dumke examined a Flowtrend replacement part for the Alfa Laval Model 761 valve and a replacement wave spring for an Alfa Laval...
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