Ill. Tool Works Inc. v. J-B Weld Co.
| Decision Date | 22 September 2021 |
| Docket Number | 3:19-cv-1434 (JAM) |
| Court | U.S. District Court — District of Connecticut |
| Parties | ILLINOIS TOOL WORKS INC., Plaintiff, v. J-B WELD CO., LLC, Defendant. |
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S
MOTION FOR PARTIAL SUMMARY JUDGMENT
This is a lawsuit between two companies that sell chemical bonding products-like epoxies, adhesives, threadlockers, gasket makers, and silicone sealants-that someone might buy at a hardware store to fix their car or for other mechanical projects. The plaintiff is Illinois Tool Works Inc., and through its Permatex division it has been in the bonding product business for many decades. The defendant is J-B Weld LLC, a relative newcomer to the business.
In this lawsuit Illinois Tool broadly claims that J-B Weld has infringed its trademarks and that it falsely advertises its products as “Made in USA.” J-B Weld in turn has moved for partial summary judgment on these claims.
First J-B Weld seeks summary judgment as to most of Illinois Tool's trademark-related claims on the grounds that these claims are time-barred by the statute of limitations and laches. I agree, because the record conclusively shows that Illinois Tool waited too long before filing its lawsuit.
Second, J-B Weld seeks summary judgment on Illinois Tool's false advertising claims. I do not agree, because the record shows that genuine fact issues still remain on the issues of whether Illinois Tool has standing and whether J-B Weld's advertising of “Made in USA” is false. Accordingly, I will grant in part and deny in part J-B Weld's motion for partial summary judgment.
This litigation largely involves competition between Illinois Tool and J-B Weld in the sale of two kinds of bonding products known as threadlockers and gasket makers. Illinois Tool has long sold threadlockers under the trademark “Permatex.”[1] Meanwhile, J-B Weld more recently began in 2010 to sell theadlockers under a somewhat similar brand name of “Perma-Lock.”[2]
Likewise, Illinois Tool has long sold gasket makers under trademarks like “Ultra Black, ” “Ultra Grey, ” and “Ultra Copper.”[3] Meanwhile, J-B Weld more recently began in 2014 to sell gasket makers under somewhat similar names of “Ultimate Black” and “Ultimate Grey.”[4]
At first, the J-B Weld threadlocker and gasket maker products sold poorly.[5] But sales eventually blossomed. By 2019, its sales of Perma-Lock threadlockers had grown five-fold since the year the brand was launched, and its sales of Ultimate-named gasket makers had grown twenty-fold.[6]
Illinois Tool filed this federal lawsuit in 2019 alleging numerous trademark-related claims against J-B Weld's “Perma-Lock” and “Ultimate” products. Specifically, Illinois Tool alleges multiple claims for unfair competition and trademark infringement under the federal Lanham Act, 15 U.S.C. § 1114(1), § 1125(a).[7] It also alleges Connecticut state law claims for common law trademark infringement, [8] for common law unfair competition, [9] and for violation of the Connecticut Unfair Trade Practices Act (CUTPA), Conn. Gen. Stat. § 42-110a.[10]
Beyond these trademark-related claims, Illinois Tool alleges separate claims for false advertising under the Lanham Act, 15 U.S.C. § 1125(a), under CUTPA, Conn. Gen. Stat. § 42-110a, and under the Connecticut common law of unfair competition.[11] According to Illinois Tool, J-B Weld has falsely advertised many of its products as “Made in USA” when in fact this is not true for significant components of its bonding products.[12]
The principles governing the Court's review of a motion for summary judgment are well established. Summary judgment may be granted only if “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P 56(a). The Court must view the facts in the light most favorable to the party who opposes the motion for summary judgment and then decide if those facts would be enough-if eventually proved at trial-to allow a reasonable jury to decide the case in favor of the opposing party. See generally Tolan v. Cotton, 572 U.S. 650, 656-57 (2014) (per curiam); Benzemann v. Houslanger & Assocs., PLLC, 924 F.3d 73, 78 (2d Cir. 2019).[13] (¶¶ 181-88) (Count XVI) (trademark infringement for Perma-Lock); 39-40 (¶¶ 189-94) (Count XVII) (unfair competition claim for Perma-Lock).
Statute of limitations and laches for trademark-related claims
J-B Weld argues that Illinois Tool's trademark-related claims are time-barred. Specifically, it argues that the state law claims are barred by the statute of limitations and that the federal Lanham Act claims are barred by laches. I will start with the state law claims, then turn to the Lanham Act claims.
The Connecticut state law claims for common law trademark infringement, for common law unfair competition, and for CUTPA are all subject to a three-year statute of limitations. See Conn. Gen. Stat. § 52-577 (); Conn. Gen. Stat. § 41-110g(f) ().
Illinois Tool filed this lawsuit in September 2019. The summary judgment record shows that J-B Weld launched Perma-Lock in 2010 and the Ultimate line in 2014.[14] Far more than three years elapsed before Illinois Tool filed this lawsuit, and so the statute of limitations precludes its state law claims.
Illinois Tool makes no serious effort to refute this point. It briefly suggests that the three-year clock started not when the J-B Weld products hit the market, but only after some other trigger, like when the products reached a certain market share.[15] But these statutes of limitations are “occurrence” statutes, meaning that they begin running at the moment of the act or omission complained of and not at some later date of discovery or convenience. See Breiner v. Stone, 122 F.3d 1055 (2d Cir. 1997) (unpub.); Khan v. Yale Univ., 511 F.Supp.3d 213, 226 (D. Conn. 2021) (§ 52-577); CSL Silicones, Inc. v. Midsun Grp. Inc., 301 F.Supp.3d 328, 371 (D. Conn. 2018) (CUTPA).
Nor does Illinois Tool argue that the continuing-course-of-conduct doctrine applies. See RBC Nice Bearings, Inc. v. Peer Bearing Co., 410 Fed.Appx. 362, 366-67 (2d Cir. 2010) (); Khan, 511 F.Supp.3d at 227 (). Accordingly, I will grant J-B Weld's motion for summary judgment as to the state law trademark-related claims involving the Perma-Lock and Ultimate line of products.
As for the federal Lanham Act claims, it is well settled that the Lanham Act does not have a statute of limitations. See Excelled Sheepskin & Leather Coat Corp. v. Oregon Brewing Co., 897 F.3d 413, 419 (2d Cir. 2018). Instead, however, a claim under the Lanham Act may be time-barred by reason of the equitable doctrine of laches. See ibid. Under laches, a plaintiff may not sue for trademark infringement if the record shows “that plaintiff had knowledge of defendant's use of its marks, that plaintiff inexcusably delayed in taking action with respect thereto, and that defendant will be prejudiced by permitting plaintiff inequitably to assert its rights at this time.” Saratoga Vichy Spring Co. v. Lehman, 625 F.2d 1037, 1040 (2d Cir. 1980); see also RBC Nice Bearings, 410 Fed.Appx. at 364 (same).
To decide whether laches bars a claim under the Lanham Act, courts start off by a benchmark reference to what is the analogous state law limitations period that would govern a claim for fraud. See Excelled Sheepskin, 897 F.3d at 419; Conopco, Inc. v. Campbell Soup Co., 95 F.3d 187, 191-92 (2d Cir. 1996). If a plaintiff has waited beyond the statute of limitations that would govern an analogous state law claim for fraud, then the burden shifts to the plaintiff to show why it would be inequitable for the complaint to be dismissed on grounds of laches. See Conopco, 95 F.3d at 191.
The statute of limitations for fraud under Connecticut law is three years. See Conn. Gen. Stat. § 52-577; RBC Nice Bearings, 410 Fed App'x at 364-65 (applying Connecticut's 3-year fraud statute as benchmark for trademark laches defense). Because I have already concluded as discussed above that this action was filed beyond Connecticut's three-year statute of limitations, the burden therefore falls on Illinois Tool to show why it would be inequitable to dismiss its Lanham Act claims.
Illinois Tool has not carried its burden. For starters, it is undisputed not only that J-B Weld's Perma-Lock and Ultimate products were on the market more than three years before Illinois Tool filed this lawsuit but also that Illinois Tool actually knew about these products more than three years before filing this lawsuit in September 2019. For instance, in 2015, Illinois Tool employees prepared a slide presentation about J-B Weld, mentioning Ultimate and Perma-Lock by name and describing each as a “Competitive Threat.”[16] In May 2016, Illinois Tool even commissioned a survey asking customers whether they preferred “J-B Weld Ultimate Black” or Illinois Tool's “Permatex Ultra Black.”[17] So by September 2019, Illinois Tool certainly knew about J-B Weld's rival products for more than three years.
Unable to deny that it knew about J-B Weld's products, Illinois Tool suggests that it was justified in waiting to sue until J-B Weld grew its market share. But that gets things backwards. The very point of laches is not for the wait-and-see...
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