Fieldturf USA Inc. v. Tencate Thiolon Middle E., LLC

• Decision Date: 10 May 2013
• Docket Number: Civil Action No. 4:11–CV–50–TWT.
• Parties: FIELDTURF USA INC., et al., Plaintiffs, v. TENCATE THIOLON MIDDLE EAST, LLC formerly known as Mattex Leisure Industries, et al., Defendants.
• Court: U.S. District Court — Northern District of Georgia

945 F.Supp.2d 1379

FIELDTURF USA INC., et al., Plaintiffs,

v.TENCATE THIOLON MIDDLE EAST, LLC formerly known as Mattex Leisure Industries, et al., Defendants.

Civil Action No. 4:11–CV–50–TWT.

United States District Court,

N.D. Georgia,

Rome Division.

May 10, 2013.

Amy C. Brown, Bruce S. Kaplan, Katherine L. Pringle, Lindsey R. Skibell, Pearline M. Kyi, Friedman Kaplan Seiler & Adelman LLP, New York, NY, Charles K. McKnight, Jr., Gary James Toman, Nations, Toman & McKnight, LLP, David Hunt Wilson, William Henry Major, III, Hawkins Parnell Thackston & Young, LLP, Atlanta, GA, for Plaintiffs.

Jessica K. Burtnett, Thomas R. Pender, William J. Cremer, Cremer, Spina, Shaughnessy, Jansen & Siegert, LLC, Chicago, IL, Alexander Stephens Clay, IV, James Francis Bogan, III, Michael John Breslin, Richard Charles Henn, Jr., Kilpatrick Townsend & Stockton, LLP, Atlanta, GA, for Defendants.

OPINION AND ORDER

THOMAS W. THRASH, JR., District Judge.

This is a breach of contract action. It is before the Court on the Plaintiffs' Motion for Partial Summary Judgment Dismissing Counts 2–9 of Defendants' Counterclaim [Doc. 354] and the Defendants' Motion for Summary Judgment [Doc. 358]. For the reasons set forth below, the Plaintiffs' Motion for Partial Summary Judgment [Doc. 354] is GRANTED and the Defendants' Motion for Summary Judgment [Doc. 358] is DENIED.

I. Background

This suit arises from three contracts to supply polyethylene fiber used to make artificial grass turf for athletic fields. In 2003, FieldTurf USA Inc., FieldTurf Inc., and FieldTurf Tarkett SAS (collectively, the “Plaintiffs” or “FieldTurf”) began negotiations to purchase monofilament fiber from Mattex Leisure Industries (“Mattex”). In September 2005, the Plaintiffs entered into a supply agreement under which Mattex would provide monofilament fiber called Evolution exclusively to the Plaintiffs (the “2005 Agreement”). ( See Defs.' Mot. for Summ. J., Ex. I). FieldTurf bought Evolution from Mattex for use in construction of artificial grass turf systems around the globe. (Compl. ¶ 1). In February 2006, Mattex issued a warranty guaranteeing Evolution's performance for six to nine years. ( See id., Ex. J). The parties entered into another supply agreement in November 2006 (the “2006 Agreement”). ( See Compl., Ex. C). The 2006 Agreement included the MLI Limited Warranty Version 1–June 2006 (the “2006 Warranty”). ( See id., Ex. M).

In February 2007, Royal TenCate N.V., a Dutch company, acquired certain assets of Mattex pursuant to an asset purchase agreement (the “Asset Purchase Agreement”). ( See Defs.' Mot. for Summ. J., Exs. N, O, & P). Royal TenCate then nominated its rights and obligations under the Asset Purchase Agreement to TenCate Thiolon Middle East, LLC (“TenCate ME”). In July 2008, TenCate ME, Polyloom Corporation of America (“Polyloom”), TenCate Thiolon B.V. (“TenCate B.V.”), and the Plaintiffs entered into a third supply agreement whereby TenCate provided FieldTurf with Evolution yarn (the “2008 Agreement”). ( See Defs.' Mot. for Summ. J., Ex. T). TenCate terminated the 2008 Supply Agreement as of March 2, 2011. (Compl. ¶ 76; Answer ¶ 76).

FieldTurf alleges that in 2009 and 2010 it began receiving complaints about the durability of the artificial turf fields it had installed using TenCate's Evolution fiber. (Compl.¶ 85). According to FieldTurf, its own subsequent testing demonstrated that the Evolution yarn was degrading prematurely. (Compl.¶¶ 96–124). In December 2010, FieldTurf announced the release of Revolution, a fiber product that would compete with Evolution. (Counterclaim ¶ 38).

On March 1, 2011, the Plaintiffs sued TenCate ME, Polyloom, and TenCate B.V. (collectively, the “Defendants” or “TenCate”)for breach of contract, breach of warranty, and fraud. See [Doc. 1]. The Defendants answered and filed counterclaims alleging commercial disparagement, intentional interference with business relations, civil conspiracy, and unfair competition. See [Doc. 54]. The Court dismissed the Plaintiffs' claims for breaches of the 2005 and 2006 Agreements against Polyloom and TenCate B.V. and dismissed the Defendants' counterclaims for commercial disparagement, civil conspiracy, as well as claims for unfair competition under various state laws while allowing the unfair competition under Georgia law claim to remain. See [Docs. 53 & 86]. The Plaintiffs now move for summary judgment on the Defendants' counterclaims for false advertising, trademark infringement, federal unfair competition, unfair competition under Georgia law, common law trademark infringement, slander, libel, and tortious interference with business relations. The Defendants move for summary judgment on the Plaintiffs' claims for fraud, breach of contract, breach of express warranty, breach of implied warranty, and on the Plaintiffs' requests for damages.

II. Summary Judgment Standard

Summary judgment is appropriate only when the pleadings, depositions, and affidavits submitted by the parties show that no genuine issue of material fact exists and that the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The court should view the evidence and any inferences that may be drawn in the light most favorable to the nonmovant. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158–59, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). The party seeking summary judgment must first identify grounds that show the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323–24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The burden then shifts to the nonmovant, who must go beyond the pleadings and present affirmative evidence to show that a genuine issue of material fact does exist. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

III. Discussion

A. The Plaintiffs' Motion for Partial Summary Judgment

1. False Advertising

FieldTurf argues that the Defendants' claim for false advertising must fail because the Defendants have not shown that any FieldTurf advertisements were literally false. To prevail on a false advertising claim under the Lanham Act, TenCate “must establish that (1) the advertisements of the opposing party were false or misleading; (2) the advertisements deceived, or had the capacity to deceive, consumers; (3) the deception had a material effect on purchasing decisions; (4) the misrepresented product or service affects interstate commerce; and (5) the movant has been—or is likely to be—injured as a result of the false advertising.” Hickson Corp. v. Northern Crossarm Co., 357 F.3d 1256, 1260 (11th Cir.2004) (quoting Johnson & Johnson Vision Care, Inc. v. 1–800 Contacts, Inc., 299 F.3d 1242, 1247 (11th Cir.2002)). “When determining whether an advertisement is literally false or misleading, courts must analyze the message conveyed in full context, and must view the face of the statement in its entirety.” Osmose, Inc. v. Viance, LLC, 612 F.3d 1298, 1308 (11th Cir.2010) (quoting 1–800 Contacts, 299 F.3d at 1248 (internal marks and alterations omitted)). “The distinction between literally false and merely misleading is often a ‘fine line.’ ” Id. (citing American Med. Corp. v. Axiom Worldwide, Inc., 522 F.3d 1211, 1225 n. 12 (11th Cir.2008)). “The ambiguity of the statement at issue ... is significant,” and “[s]tatements that have an unambiguous meaning, either faciallyor considered in context, may be classified as literally false.” Id. at 1308–09 (citing United Indus. Corp. v. Clorox Co., 140 F.3d 1175, 1180 (8th Cir.1998)). “If the court deems an advertisement to be literally false, then the movant is not required to present evidence of consumer deception,” but if the court concludes the advertisement is “true but misleading, then the movant is required to present evidence of deception.” Id. at 1319 (quoting 1–800 Contacts, 299 F.3d at 1247). TenCate argues that FieldTurf's advertisements about Revolution were literally false when they claimed that Revolution was the “industry's strongest fiber,” that Revolution had “the strongest ultraviolet inhibitor in the industry,” that Revolution was “the most natural looking” fiber, and that Revolution “has the strongest tuft bind.” ( See Defs.' Resp. in Opp'n to Pls.' Mot. for Partial Summ. J., Ex. 3).

a. Industry's Strongest Fiber

TenCate argues that FieldTurf's use of the phrase “industry's strongest fiber” with respect to Revolution is false advertising. TenCate argues the advertisement must refer to tensile strength and provides evidence that Revolution does not contain the strongest tensile strength in the industry. (Willard Dep. at 356–57). However, the global group director of TenCate grass admitted in his deposition that fiber “strength can be measured in many ways” and that the assertion that the fiber is the strongest in the industry could be understood in several ways. ( See Pls.' Mot. for Partial Summ. J., Ex. 2, Vliegen Dep. at 34, 167–68). The Court concludes, based on the competing evidence, that the phrase “industry's strongest fiber” is not susceptible to only one interpretation. Because the statement is ambiguous and could cover several different meanings of “strength” aside from “tensile strength,” TenCate has not shown that the statement was literally false. See Osmose, 612 F.3d at 1309 (“As the meaning of the statement becomes less clear, however, and it becomes susceptible to multiple meanings, the statement is more likely to be merely misleading.”). Because TenCate has not offered any evidence of consumer deception, FieldTurf's motion for partial summary judgment with respect to the false advertising claim stemming from FieldTurf's “industry's strongest fiber” promotion should be granted. See id. at 1319 (requiring evidence of consumer deception when the advertisement at issue is only misleading).

b. Strongest Ultraviolet Inhibitor

TenCate argues that FieldTurf's claim that Revolution contains the “strongest ultraviolet inhibitor technology in the industry” is...