Diagnostic Marketing Intern., Inc. v. Diamed, Inc., Civ. No. 88-0311-P.

• Decision Date: 15 February 1989
• Docket Number: Civ. No. 88-0311-P.
• Citation: 707 F. Supp. 50
• Parties: DIAGNOSTIC MARKETING INTERNATIONAL, INC., d/b/a DMI, Plaintiff, v. DIAMED, INC., Defendant.
• Court: U.S. District Court — District of Maine

707 F. Supp. 50

DIAGNOSTIC MARKETING INTERNATIONAL, INC., d/b/a DMI, Plaintiff, v. DIAMED, INC., Defendant.

Civ. No. 88-0311-P.

United States District Court, D. Maine.

February 15, 1989.

Elizabeth A. Hoglund, Portland, Me., for plaintiff.

Martin L. Wilk, Eaton, Peabody, Bradford & Veague, Brunswick, Me., for defendant.

MEMORANDUM OF DECISION AND ORDER DENYING PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION AND GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

GENE CARTER, District Judge.

I. INTRODUCTION

Before the Court is Defendant's Motion for Summary Judgment, filed on December 28, 1988 as Docket No. 88-0311-P. Plaintiff Diagnostic Marketing International, Inc. seeks a preliminary injunction ordering Defendant Diamed, Inc. to refrain from doing business under or using in any way the initials "DMI" in the course of Defendant's business operation or otherwise. Defendant opposes Plaintiff's motion for preliminary injunction and moves for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure, claiming that there exists no issue of material fact and that, therefore, Defendant is entitled to summary judgment as a matter of law. For the purposes of the Court's analysis, the motions are considered together. The Court hereby denies Plaintiff's motion for preliminary injunction and grants Defendant's motion for summary judgment.

II. FACTUAL BACKGROUND

The following relevant facts are undisputed except as specifically indicated. On March 13, 1980, Data Management, Inc., a Maine corporation not a party to this action, filed an application for registration of trademarks and service marks with the Maine Secretary of State pursuant to 10 M.R.S.A. section 1522. This application was for a combined service/trade mark in a stylized version of the letters DMI, and listed the goods and services to which the mark would be applied as "printed matter, office requisites, computer software services and products and related advertising and promotion ... advertising and business."

Defendant Diamed, Inc. has been incorporated as a Maine corporation since 1983, doing business in the manufacture and sale of biomedical research supplies. Defendant claims that in 1983 it began using the DMI initials in conjunction with its full corporate name on all its stationery and on a sign on its premises. Plaintiff does not specifically dispute this, and acknowledges that Defendant was using the DMI initials on its stationery in August 1986, when Plaintiff received an invoice from Defendant bearing the DMI initials. Defendant's use of the DMI initials has continued until November 1988, when it claims it ceased such use. Plaintiff disputes Defendant's contention that Defendant ceased such use in November.

Plaintiff was incorporated in Maine in 1985 and is involved in the importation, sale and distribution of biomedical research supplies. Plaintiff claims, and Defendant does not dispute, that in January 1986, Plaintiff applied to the Secretary of State for permission to do business under the assumed name of DMI pursuant to 13-A M.R.S.A. section 307. Plaintiff further claims, and Defendant does not deny, that permission was denied by the Secretary of State on the basis that Data Management, Inc. held a registered trade/service mark in the DMI initials. As indicated above, Plaintiff became aware in August 1986 that Defendant was using the DMI initials on its business stationery. Defendant has never registered the DMI initials as a service or trade mark pursuant to 10 M.R.S.A. section 1522, nor has it registered to do business under the initials DMI as an assumed name pursuant to 13-A M.R.S.A. section 307.

On January 26, 1987, Plaintiff obtained a default judgment in its favor in the Maine Superior Court for Cumberland County, finding that Data Management, Inc. had abandoned its right to use the assumed name DMI for purposes of 10 M.R.S.A. section 1527(1)(d)(1) and 10 M.R.S.A. section 1522(1)(F). On January 27, 1987, Plaintiff filed a statement of intention to do business under the assumed name of DMI with the Secretary of State pursuant to 13-A M.R.S.A. section 307. Permission to do so was granted on February 4, 1987, and Plaintiff began immediately thereafter to use the initials DMI as its assumed name.

Plaintiff filed this action with the Court on November 16, 1988, alleging infringement of an unregistered trademark under the Lanham Act, 15 U.S.C. section 1125(a), as well as violations of state law under 10 M.R.S.A. section 1211, et seq., 13-A M.R.S. A. section 307, and state common law. Plaintiff seeks preliminary and permanent injunctive relief, as well as damages. Accompanying Plaintiff's complaint is a motion for preliminary injunction pursuant to Rule 65 of the Federal Rules of Civil Procedure. In response, Defendant filed a joint objection to the motion for preliminary injunction and a motion for summary judgment. The Court considers both motions together and concludes that the undisputed facts before it lead to the conclusion that Defendant is entitled to summary judgment as a matter of law.

III. ANALYSIS

In its complaint, Plaintiff raises four causes of action under federal and state law for which it seeks both injunctive relief and damages for Defendant's use of the initials DMI. Plaintiff alleges that Defendant's use constitutes an infringement of an unregistered trademark, in violation of section 1125(a) of the Lanham Act, 15 U.S. C. § 1051, et seq. Plaintiff also alleges that Defendant's use constitutes a violation of the Maine Deceptive Trade Practices Act, 10 M.R.S.A. section 1211, et seq., unfair competition under common law, and an unauthorized use of an assumed name in violation of 13-A M.R.S.A. section 307. The Court addresses the federal claim and the state law claims separately.

A. Federal law — The Lanham Act

Section 1125(a) of the Lanham Act provides a statutory remedy for the holder of an unregistered trademark against anyone who makes an unauthorized use of that trademark. Section 1125(a) states in pertinent part:

Any person who shall affix, apply, or annex, or use in connection with any goods or services, or any container or containers for goods, a false designation of origin, or any false description or representation, including words or other symbols tending falsely to describe or represent the same, and shall cause such goods or services to enter into commerce, ... shall be liable to a civil action by any person doing business in the locality falsely indicated as that of origin or in the region in which said locality is situated, or by any person who believes that he is or is likely to be damaged by the use of any such false description or representation.

15 U.S.C. § 1125(a). Under this section, a trademark holder enjoys statutory rights regardless of whether or not a disputed trademark has been registered pursuant to the Lanham Act. Keebler Co. v. Rovira Biscuit Corp., 624 F.2d 366 (1st Cir.1980).

A plaintiff is entitled to protection under section 1125(a) of the Lanham Act if it can establish a right to exclusive use of the mark. Id. at 373. It is axiomatic that the only way to establish a trade or service mark is by actual use of the mark. The exclusive right to a distinctive mark belongs to the one who first uses it in connection with a particular line of business. Volkswagenwerk Aktiengesellschaft v. Wheeler, 814 F.2d 812, 815 (1st Cir.1987); R. Callman, 3 The Law of Unfair Competition Trademarks and Monopolies § 19.01 at 3 (4th ed. 1983). Thus, where the right to use a particular trademark is contested, the priority of appropriation and use determines which litigant will prevail in its use. United Drug Co. v. Rectanus, 248 U.S. 90, 100, 39 S.Ct. 48, 51, 63 L.Ed. 141 (1918).

It is undisputed on the present record that Defendant's use of the DMI initials precedes Plaintiff's. Plaintiff has not challenged Defendant's claim, supported by the affidavit of its vice-president of operations, to use of the DMI initials on its stationery since 1983 and on a sign on its premises since 1985. Indeed, Plaintiff expressly acknowledges that it became aware of Defendant's use of the DMI initials sometime in 1986, presumably when it received a transaction invoice dated August 29, 1986 from Defendant, on which the DMI initials appeared on Defendant's letterhead. Plaintiff and Defendant agree that Plaintiff did not begin using the DMI initials as its logo until January of 1987. Accordingly, the record before the Court shows clearly that Defendant's use preceded Plaintiffs.

In its memorandum in opposition to Defendant's motion for summary judgment, Plaintiff claims that a demonstration of "secondary meaning" is necessary to establish a right to exclusive use of a mark. The secondary meaning doctrine states that

words which have a primary meaning of their own ... may by long use in connection with a particular product, come to be known by the public as specifically designating that product.

Volkswagenwerk Aktiengesellschaft v. Wheeler, 814 F.2d at 816, citing Volkswagenwerk AG v. Rickard, 492 F.2d 474, 477 (5th Cir.1974). The establishment of a secondary meaning in a word or group of letters is an issue of fact. See Volkswagenwerk Aktiengesellschaft v. Wheeler, 814 F.2d at 816. According to Plaintiff's argument, since it is a question of fact whether a secondary meaning in the letters DMI has developed, the Court is precluded from issuing summary judgment.

The instant case, however, is factually distinct from other cases in which the secondary meaning of a trademark becomes a pivotal question. Such cases typically involve a plaintiff who has established a mark by prior use and who sues to prevent the use of a similar mark by defendant. See, e.g., National Football League Properties, Inc. v. Wichita Falls Sportswear, Inc., 532 F.Supp. 651 (W.D.Wash.1982) (plaintiff National Football League Properties sued to prevent defendant's use of league insignia on replica league jerseys); D.C. Comics,...