Intel Corp. v. Advanced Micro Devices, Inc.
| Decision Date | 28 February 1991 |
| Docket Number | No. C-90-20571-WAI.,C-90-20571-WAI. |
| Citation | 756 F. Supp. 1292 |
| Parties | INTEL CORPORATION, Plaintiff, v. ADVANCED MICRO DEVICES, INC., Defendant. And Related Counterclaims. |
| Court | U.S. District Court — Northern District of California |
Lois W. Abraham, Brown & Bain, Palo Alto, Cal., and F. Thomas Dunlap, Jr., Intel Corp., Santa Clara, Cal., for plaintiff.
Douglas K. Derwin, Skjerven, Morrill, MacPherson, Franklin & Friel, San Jose, Cal., and Richard H. Lovgren, Advanced Micro Devices, Inc., Sunnyvale, Cal., for defendant.
MEMORANDUM OF INTENDED DECISION
This application for permanent injunction, and for finding of validity and infringement of plaintiff's asserted trademark is one of several phases of the trial of the above-entitled action. This first phase came duly on for trial before the court on January 7, 1991 and proceeded for sixteen trial days, and was submitted for decision on February 7, 1991. Following submission, both sides filed memoranda and briefing on discrete issues. I have carefully considered those submissions.
This Memorandum of Intended Decision constitutes Findings of Fact and Conclusions of Law consistent with the provisions of Fed.R.Civ.P. 52(a).
Inasmuch as this is a Memorandum of Intended Decision, and is decisive of only some of the issues included in the above-entitled action, I will entertain argument on objections to findings encompassed herein prior to the entry of any judgment herein, to be conducted at a time mutually convenient to counsel and to me.
This decision is dispositive of this first phase of the case. However, mindful that this disposition may not survive appellate scrutiny, and that an appellate court may find that a group composed of end users or some hybrid group constitutes the relevant public, I intend to file a subsequent memorandum disposition which will assume arguendo that the relevant market group deemed appropriate by plaintiff, i.e. business affiliated end users, constitutes the relevant public.
I do not at this time anticipate that the subsequent memorandum disposition will alter the end result of the instant decision, but it will contain an analysis of those surveys which deal with the end user group.
Counsel will please arrange with the Clerk of this Court an acceptable schedule for the preparation and trial of the second phase of this action.
Plaintiff is not entitled to the injunctive relief which it seeks by this application.
The combination 386 is generic under the evidence. Plaintiff has failed to prove by a preponderance of the evidence that the combination 386 is not generic.
The appropriate group by which to measure consumer perception of the combination 386 is one composed of Original Equipment Manufacturers (OEMs) who purchase microprocessors for inclusion as component parts in their manufactured products.
Plaintiff has the burden of proof on all issues presented by this phase of the above-entitled action, and the applicable burden is a preponderance of the evidence.
Each side advocates a different group of "purchasers" who constitute the appropriate group for purposes of measuring purchaser perception of the 386 combination. The group, if either, which I find to be appropriate will constitute the sine qua non for defining relevant evidence as to purchaser perception on the issues of the purported genericness of the 386 combination and/or whether that combination has achieved a secondary meaning or whether use of the accused mark will cause confusion or likelihood of confusion.
Plaintiff contends that the appropriate group should be comprised of an "end user" group. Plaintiff limits that group to persons who are users of personal computers which contain as a component part a 386 microprocessor. Plaintiff defines those users as persons who use personal computers in the course of their work in a business environment and for business purposes, and/or are MIS managers or data processing managers within businesses which utilize personal computers. This user/managerial group must also, in order to be a part of plaintiff's proffered group, have some part in the selection and purchase of personal computers for use within the employing business. One of the surveys offered by plaintiff required that the members of this group must also be employed at a site at which at least 100 persons are employed, and another specified a minimum number or more personal computers at the surveyed site.
Defendant contends that the appropriate group consists of Original Equipment Manufacturers (OEMs) who constitute the direct purchasers of microprocessors from the manufacturers thereof. This contention is made because, says defendant, microprocessors are rarely or never sold to end users of personal computers. They are, and have always been, sold to OEMs who then incorporate them into the construction of personal computers and other products which are in turn sold to end users. Testimonial support which reflects how these microprocessors pass in commerce is found at these references, among others: 4-100:21-101:3; 4-571:6-8; 6-1110:13-1111:13; 11-2069:10-2070:12; 2-194:16-18; 3-408:20-21.
Defendant contends also, with merit, that the facts presented in this case indicate that the identity of the microprocessor contained in a personal computer is in no way perceived by an end user purchaser, short of dismantling the computer. Normally, the microprocessor is neither seen, touched nor physically perceived in any manner. It is a part of an article sold in a different product, and is only purchased by the ultimate user in the sense that every part of the personal computer which makes up the whole may be said to be purchased.
The purchase of the microprocessor as a discrete product is only accomplished as between the manufacturer of the microprocessor, such as plaintiff and defendant, and the manufacturer of the personal computer.
There is little dispute in this case as to the manner in which microprocessors are sold by their manufacturers. They are not generally, if at all, sold to other than OEMs who then utilize them for some purpose of their own.
OEMs are the "usual buyers" of microprocessors.
Plaintiff argues that the relevant market is comprised of end users of personal computers. There is testimonial agreement with that contention. 4-601:22-602:1; 5-726:9-18.
In support of its contention, plaintiff cites a number of cases which are "single product" cases,1 meaning that the product as originally manufactured reached the end user in precisely the form in which it left the manufacturer, and not as a component part of some other product. Those cases are not very helpful in reaching a solution as to relevant market in this case.
Plaintiff has cited two cases which it characterizes as component cases, similar to this case. Thomas Pride Mills, Inc. v. Monsanto Co., 155 USPQ 205 (N.D.Ga. 1967), is a suit by a carpet maker against the maker of synthetic fibers used in carpets to cancel the latter's registered mark on the ground of its genericness, and to preliminarily enjoin continued enforcement of that registered mark. Plaintiff in that case offered in evidence a telephone survey. The court noted the survey, noted that its admissability and probative value would be determined at trial, and said nothing more about it. The case is no help.
The other cited case, E.I. Dupont de Nemours & Co. v. Yoshida International, Inc., 393 F.Supp. 502 (E.D.N.Y.1975) is so factually distinguishable that its precedent value in this case is unacceptable to me. Plaintiff in that case is a manufacturer of a TFE resin substance bearing the registered mark Teflon. The substance is a non-stick, lubricous component of cookware and other products not manufactured by plaintiff. Defendant is a foreign manufacturer of zippers called Eflon, which characteristically worked smoothly and well, but without the addition of the component additive Teflon. Plaintiff, as an aid to the marketing of the products of its manufacturer customers permitted the use of its registered mark, and in many cases issued to such customers a certificate of high quality, which was incorporated into the advertising of such customers and reference to which appeared on the face of the products in many cases. In bringing the action for trademark infringement plaintiff purported to act in behalf of its customers. The court recognized that paragraph 15 of the complaint alleges as much. The court recognized that for purposes of measuring proximity of products in an infringement action, the certification mark owner acts as a representative of certification mark users in the prosecution of an action for infringement of a trademark.
The case is further distinguishable because it is essentially a single product case. The product whose name was accused was a single product not enhanced by the use of the component Teflon. The pots and pans which formed the basis for questions in the "Teflon Survey" used in that case were single products whose utility was enhanced by the component Teflon, but whose essential identity as pots and pans was always the same, and whose relevant market was always the same.
Thus, the relevant market of the customer of pots and pans is the appropriate group for measurement purposes in that case, and in my view the case cannot stand for the proposition that the ultimate consumer constitutes the relevant market in a component case. This view is not altered in any way by the existence in the case of surveys, proffered by both sides, which surveyed groups of persons other than the immediate purchasers from plaintiff of the product Teflon. These surveys were conducted on the issue of the asserted genericness of the mark Teflon, and it does not appear from the opinion that there was any justiciable controversy over the consist of the relevant market.
In the course of the trial defendant has cited to me a number of cases2...
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