Berlin Packaging, LLC v. Stull Technologies, Inc.

• Decision Date: 09 August 2005
• Docket Number: No. 03 C 7636.,03 C 7636.
• Citation: Berlin Packaging, LLC v. Stull Technologies, Inc., 381 F.Supp.2d 792 (N.D. Ill. 2005)
• Parties: BERLIN PACKAGING, LLC, a Delaware limited liability corporation, Plaintiff/Counter-Defendant, v. STULL TECHNOLOGIES, INC., a New Jersey corporation, Defendant/Counter-Plaintiff.
• Court: U.S. District Court — Northern District of Illinois

381 F.Supp.2d 792

BERLIN PACKAGING, LLC, a Delaware limited liability corporation, Plaintiff/Counter-Defendant, v. STULL TECHNOLOGIES, INC., a New Jersey corporation, Defendant/Counter-Plaintiff.

No. 03 C 7636.

United States District Court, N.D. Illinois, Eastern Division.

August 9, 2005.

COPYRIGHT MATERIAL OMITTED

Marvin N. Benn, Stephen J. Cassin, Much Shelist Freed Denenberg Ament & Rubenstein, P.C., Chicago, IL, for Plaintiff.

Kristin Joy Achterhof, Julie P. Setren, Katten Muchin Zavis Rosenman, Chicago, IL, for Defendant.

MEMORANDUM OPINION AND ORDER

DENLOW, United States Magistrate Judge.

I. INTRODUCTION

This matter comes before the Court on Plaintiff Berlin Packaging, LLC's ("Berlin") motion for partial summary judgment regarding the issue of trade dress infringement. Berlin requests a declaratory judgment that its use of alleged trade dress for a container cap does not infringe any trademarks or trade dress owned by Stull Technologies, Inc. ("Stull"). Berlin argues that its use of the cap does not violate any trade dress because the features of the cap are functional and it has a constitutional right to copy the cap by reason of an expired utility patent under United States patent laws. Stull contends that Berlin's motion for summary judgment should be denied because there are genuine issues of material fact for trial. The Court finds that no genuine issues of material fact exist. For the reasons set forth below, Berlin's motion for partial summary judgment is granted.

II. BACKGROUND¹

The cap at issue in this case (the "Cap") was designed in the late 1970s by Gene R. Stull, President, C.E.O. and owner of Stull. G. Stull Decl. ¶ 1,7. Gene Stull has been working in the packaging and plastics industries for over thirty years and holds over thirty patents in both the U.S. and worldwide. G. Stull Decl. ¶ 3. Stull is in the business of manufacturing, marketing, selling and distributing child-resistant bottle closures and caps. Answer ¶ 3. Stull was the assignee of U.S. Patent No. 4,281,778 (the " '778 Patent") entitled "Locking closure cap" which expired on or before January 18, 2000. Comb. Resp. ¶ ¶ 6,7.

The '778 Patent describes a child proof closure that attached to containers for various types of liquids, including toxic and/or flammable liquids. '778 Patent, Col. 1, Lines 5-8. The shape of the top of the closure was semi-circular and contained a tab in the shape of a circle with two triangular edges on its front in the design of a "cat face." The closure also contains a single strap at the back of the tab and three holes in the orifice area to squirt liquid, rather than pour liquid. '778 Patent, Col. 5, Lines 4-10; 39-42.

After the '778 Patent expired in 2000, Berlin began promoting and attempting to sell a charcoal lighter fluid closure that is nearly identical to that of the Stull cap. G. Stull Decl. at ¶ 9. On August 12, 2003, Stull obtained U.S. trademark registration number 2,749,627 for the trade dress associated with the closure cap. G. Stull Decl. at ¶ 8. As a result of the trade dress, Stull sent a demand letter to Berlin in which Stull alleged that Berlin's closure for lighter fluid violated Stull's rights and demanded that Berlin discontinue manufacturing, marketing and selling the cap. Stull's Combined Resp. ¶ 12. In August 2003, Berlin brought an action against Stull for a declaration by the Court that Berlin's use of alleged trade dress for the cap does not infringe any valid trademarks or trade dress owned by Stull and for an order canceling Stull's U.S. Trademark Registration No. 2,749,627. Stull filed a counterclaim against Berlin for trade dress infringement and dilution, false designation of origin, passing off, deceptive trade practices and unfair competition.

Berlin now moves for partial summary judgment. Berlin seeks summary judgment on Count I (Declaratory Judgment as to the Lanham Act) and Count II (Declaratory Judgment as to Illinois Law) of its amended complaint, but does not seek summary judgment on Count III (Cancellation of Stull's Trademark Registration). In addition, Berlin seeks summary judgment on Counts I through VII of Stull's counterclaim.

III. LEGAL STANDARDS

A. JURISDICTION

This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C. § 1331, 1332, 1338(a) and 1338(b); 15 U.S.C. § 1121; and 28 U.S.C. § 1367. Venue in this district is proper pursuant to 28 U.S.C. § 1391. The parties have consented to a Magistrate Judge's jurisdiction pursuant to 28 U.S.C. § 636(c)(1).

B. SUMMARY JUDGMENT STANDARD

Summary judgment is proper if the record shows that there is no genuine issue as to any material fact, and that the moving parties are entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). A genuine issue for trial exists only when "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted. Id. at 249-50, 106 S.Ct. 2505; see also NutraSweet Co. v. X-L Engineering Co., 227 F.3d 776, 785 (7th Cir.2005). In deciding a motion for summary judgment, the Court must view all evidence in light most favorable to the nonmoving party, Germano v. Winnebago County, Ill., 403 F.3d 926, 927 (7th Cir.2005), and must draw all reasonable inferences in the nonmovant's favor. Harper v. Albert, 400 F.3d 1052, 1067 (7th Cir.2005).

When a material fact or a set of facts yields competing, but reasonable, inferences, then there is a genuine issue that precludes summary judgment. The non-moving party's burden is to identify facts that are both material and genuinely disputed. Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). To be material, a fact must be outcome determinative under the substantive law governing the motion. Insolia v. Philip Morris Inc., 216 F.3d 596, 598-99 (7th Cir.2000). A "genuine issue" exists when the party opposing the motion for summary judgment serves and files, pursuant to Local Rule 56.1, a concise statement outlining the material facts that require denial of summary judgment, supported by citations to the evidentiary materials that support those denials (e.g., affidavits, depositions, answers to interrogatories, admissions etc.). Fed. R. Civ.P. 56(c). Although the party seeking summary judgment bears the initial burden of proving that there is no genuine issue of material fact, Celotex, 477 U.S. at 323, 106 S.Ct. 2548, the non-moving party cannot rely upon the pleadings alone, but must use evidentiary tools outlined above to identify the material facts that show there is a genuine issue for trial. Id. at 324, 106 S.Ct. 2548, Insolia, 216 F.3d at 598.

IV. DISCUSSION

Berlin now moves for partial summary judgment on Stull's trademark and related claims as a matter of law because the elements of the cap are functional. The question in this case arises at the intersection of the United States' patent and trademark laws. The principal issue concerns whether the product features of the cap are functional.

A. RELATIONSHIP BETWEEN PATENT AND TRADEMARK LAW

There is an "undeniable tension" between trademark protection of product configurations and patent law. Thomas & Betts v. Panduit Corp., 138 F.3d 277, 285 (7th Cir.1998)(T & B II). However, "[w]hen confronted with apparently conflicting statutes which are `capable of co-existence, it is the duty of the courts, absent a clearly expressed congressional intention to the contrary, to regard each as effective.' " Id. (quoting Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1018, 104 S.Ct. 2862, 81 L.Ed.2d 815 (1984)). In patent law, the purpose is to encourage innovation while inviting competition; the recipient of a patent is granted a monopoly for a limited time, after which the innovation passes to the public for copying and improvement. T & B II, 138 F.3d at 283. However, awarding the recipient of a patent a monopoly forever, as is provided by trademark protection, is incompatible with the purpose of patent law; patent law favors dedicating innovations to the public and trademark law advocates perpetual protection for innovations in order to prevent consumer confusion. Id. at 283-284.

This tension is the subject of the dispute presented by the parties. In this case, it is alleged that Stull's claimed and registered trade dress for its cap was also disclosed and claimed in its expired utility patent. Because the heart of this dispute is the relationship between patent and trademark law, it is appropriate to begin with a summary of the purposes of and policies behind each.

1. Patent Law

It is at the heart of patent law to encourage invention by granting inventors a monopoly over new product designs or functions for a limited time after which competitors are free to use the innovation. Qualitex, 514 U.S. 159, 164-165, 115 S.Ct. 1300, 131 L.Ed.2d 248 (1995). "Copying is not only good, it is a federal right-a necessary component to the patent system's grant of limited monopolies." Thomas & Betts Corporation v. Panduit Corp., 65 F.3d 654, 657 (7th Cir.1995)("T & B I"). For an invention to be patented, an item must fulfill three conditions: it must be novel, it must possess utility, and it must be non-obvious. T & B II, 138 F.3d at 283; see generally Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 480, 94 S.Ct. 1879, 40 L.Ed.2d 315 (1974). Those inventions meeting the conditions are granted patent protection, which gives the inventor a twenty year monopoly on the manufacture or exploitation of the device. Id. After the expiration of the patent, the public is free to copy and profit from the invention. Id.

2. Trademark Law

It is the purpose of trademark law not to encourage invention, but to promote competition and maintain quality by protecting the reputation of the producer for an unlimited time. Qualitex, 514 U.S. at 165, 115...