Mountain Top Beverage v. Wildlife Brewing N.B.

• Decision Date: 21 November 2003
• Docket Number: No. C-1-01-832.,C-1-01-832.
• Parties: MOUNTAIN TOP BEVERAGE GROUP, INC., Plaintiff, v. WILDLIFE BREWING N.B., INC. et al., Defendants.
• Court: U.S. District Court — Southern District of Ohio

Page 827

338 F.Supp.2d 827

MOUNTAIN TOP BEVERAGE GROUP, INC., Plaintiff, v. WILDLIFE BREWING N.B., INC. et al., Defendants.

No. C-1-01-832.

United States District Court, S.D. Ohio, Western Division.

November 21, 2003.

Scott Lloyd Braum, Scott L. Braum & Associates, Ltd., Thomas Patrick Whelley, II, Rachael Leigh Rodman, Todd Evan Bryant, Chernesky, Heyman & Kress, Dayton, OH, for Plaintiffs.

David Lee Petitjean, Chappano Wood PLL, Columbus, OH, Alan Towner, Martha S. Helmreich, William Pietragallo, II, Pietragallo, Bosick & Gordon, Pittsburg, PA, Robert Alan Klingler, Cincinnati, OH, for Defendants.

ORDER

DLOTT, District Judge.

This matter comes before the Court on Defendants Wildlife Brewing N.B., Inc. ("Wildlife") and James Sorenson ("Sorenson")'s Motion for Summary Judgment Against Plaintiff and Third-Party Defendants (doc. # 32) and on Defendant Pittsburgh Brewing Co. ("PBC")'s Motion for Summary Judgment (doc. # 22). All defendants ask the Court to find that Plaintiff Mountain Top Beverage Group, Inc. ("Mountain Top")'s federally registered trademark is invalid and that they are thus not liable to Mountain Top on Mountain Top's federal claims of trademark infringement and false designation of origin, nor on Mountain Top's related state law claims of deceptive trade practices, tortious interference with economic relations and unfair competition. Additionally, Defendants Wildlife and Sorenson ask the Court to find that Mountain Top and Third-Party Defendant B.L.S. of Sarasota ("BLSS") are liable to Wildlife on a federal false designation of origin claim and related state and common law claims of trademark infringement, unfair competition, dilution of mark, tarnishment and injury to business reputation, unfair business practices, deceptive trade practices, and tortious interference with a contract and business relationship. For the reasons set forth below, Defendant PBC's motion is GRANTED. Defendants Wildlife and Sorenson's motion is GRANTED IN PART and DENIED IN PART.

I. FACTUAL BACKGROUND

This case involves the manufacture and sale of competing malt liquor products bearing the name "Wildcat." On July 19, 1993, Third-Party Defendant BLSS filed an Intent to Use trademark application ("ITU application") with the United States Patent and Trademark Office ("USPTO") to register "X 40 Wildcat" as a trademark on the USPTO's Principal Register in connection with beer and malt liquor. (Doc. # 32, exh. JJ.) An ITU application allows a trademark applicant to begin the federal registration process without actually using the mark at the time of application. See 15 U.S.C. § 1051(b). The USPTO then issues a Notice of Allowance stating that a mark is in compliance with formalities and is registrable. Within six months an ITU applicant must file a Statement of Use ("SOU") and specimen or facsimile of the mark in order to successfully register its trademark. The applicant may request and receive a number of extensions of time in which to file the SOU, so long as the SOU issues no later than thirty-six months after the Notice of Allowance. See 15 U.S.C. § 1051(d)(2). The SOU is a verified statement that the mark is in use in commerce, specifying the date on which the mark was used in commerce, the goods in connection with which the mark was used, and the manner in which the mark is used in connection with the goods. See 15 U.S.C. § 1051(d)(1). Subject to examination of the SOU, the mark is then registered on the Principal Register. Id. On August 28, 2000, the last possible day in which BLSS could file its SOU without abandoning its trademark application, BLSS filed its SOU to register the Wildcat mark, (doc. 34, exh. A at ¶ 16), and on November 13, 2001, "40 Wildcat" ("The Wildcat mark") was registered on the Principal Register of the USPTO. (Id., exh. B.)

BLSS's SOU consisted of a photograph of a bottle with the mark affixed to it and the signed statement of Brady Skinner, president of BLSS, that "[a]pplicant is using the mark in commerce on or in connection with the following goods: malt liquor in class 32. The mark was first used at least as early as August 22, 2000, and first used in commerce at least as early as August 22, 2000. Applicant is using the mark in interstate commerce." (Doc. # 32, exh. UU.) The SOU provides no details as to how the mark was used, no information indicating whether there were any sales or interstate transportation of the goods, no details as to what quantity of the goods was produced, nor what revenue the goods had earned.

Defendants have established through depositions of Mountain Top personnel and through answers to interrogatories that from the 1993 filing date of the ITU application until the commencement of this action, neither Plaintiff nor its predecessor BLSS had made any sales of any products bearing the Wildcat mark, nor conducted any advertising or marketing of any products bearing the Wildcat mark. (Doc. # 32, exh. CC at question # 4, # 13). Defendants have established that there are no items bearing the Wildcat mark being marketed, sold, distributed or otherwise provided by Plaintiff. (Id. at question # 16). Although Plaintiff, as required by statute, enclosed an image of a Wildcat product in its SOU, a true sample of packaging that could be used on a product eligible for sale was not available until at least August 30, 2000 because the labels required by ATF were not approved until then. (Doc. # 32, Smith depo. at 70) (no distribution of beer and malt liquor products without ATF approval). Further, Defendants have shown that Plaintiff had not yet contracted with a brewer to produce a Wildcat product at the time the SOU was filed, and the brewer with whom Skinner companies were in contact ("Frederick Brewing") could not even quote a price until September of 2000, let alone have produced a shipment of the actual brew. (Doc. # 32, exh. N) (production fees still in discussion by September 9, 2000).

There was no sale of goods bearing the Wildcat mark by any Skinner company until January 10, 2001, when Frederick Brewing Company sold a shipment to KABCo (Doc. # 32, exh. T.) The shipment was later destroyed by one of the Skinner companies because Mountain Top did not want to sell its Wildcat product while Wildlife's Wildcat products were sold in the market. (Doc. # 32, Smith depo. at 73). The interaction between BLSS, Mountain Top, KABCo and Heartland Distributing company is somewhat complicated, but suffice to say, all are solely owned or majority controlled by Brady L. Skinner.

The evidence shows that the Wildcat product shown in the SOU was a "dummy sample." Bert Smith, an operations employee of KABCo, testified in his deposition that a "dummy sample" of a Wildcat product was created and shown by local salespeople to retailers in the summer of 2000 although he couldn't be sure if the display actually occurred or by whom and to whom the sample might have been shown. (Id. at 122-24.) Smith clarified that he did not in fact know if a salesperson had ever shown the dummy sample. (Id. at 123-24.) Smith also testified that there was no chance that the dummy sample contained the actual brew to be sold. (Id. at 261-63.) He stated that there were no items bearing Wildcat marks marketed, sold, distributed, or otherwise provided by Mountain Top or BLSS. (Doc. # 32, Smith depo. at 222-24). Brady Skinner, president of BLSS and majority shareholder of Mountain Top, testified that he personally never placed an order for any Wildcat product with David Snyder (the head of Frederick Brewing's parent company) (doc. # 32, Skinner depo. at 65), and that Bert Smith would be the only other person authorized to do so. (Id. at 67.)

In early 1999, while BLSS' ITU application to register its Wildcat mark was pending, BLSS learned that Defendants Wildlife and Sorenson were using the name "Wildcat" in connection with the manufacture and sale of either beer or malt liquor or both. (Doc. # 34, exh. A ¶ 12.) Shortly thereafter, BLSS notified Defendants Wildlife and Sorenson of BLSS' ITU application and informed Wildlife and Sorenson that their use of the name Wildcat constituted infringement of BLSS' pending Wildcat trademark. (Id. ¶ ¶ 13-14.) After a second letter from BLSS to Wildlife and Sorenson in February of 2001, Wildlife and Sorenson responded in March of 2001 with a letter to BLSS asserting that Sorenson was the owner of the common law trademark "Wildcat" and any use of the mark Wildcat by BLSS would constitute infringement. (Id. at letters following exh. A.)

On December 3, 2001, BLSS assigned its Wildcat mark to Mountain Top. (Id., exh. D.) On December 5, 2001, Mountain Top commenced the instant action against Defendants Wildlife and Sorenson and against Defendant PBC, the company that manufactures Wildlife's Wildcat products, alleging federal claims of trademark infringement and false designation of origin, and related state law claims of deceptive trade practices, tortious interference with economic relations and unfair competition, and asking the Court to cancel Wildlife's Ohio state registration of the marks "Wild Cat Ice" and "Wild Cat Malt Liquor." Defendants Wildlife and Sorenson counterclaimed, alleging a federal claim of false designation of origin and related state and common law claims of trademark infringement, unfair competition, dilution of mark, tarnishment, and injury to business reputation, unfair business practices, deceptive trade practices, and tortious interference with a contract and business relationship. All Defendants seek cancellation of Mountain Top's trademark on the grounds that it was never "used in commerce."

II. STANDARD FOR SUMMARY JUDGMENT

Federal Rule of Civil Procedure 56 governs motions for summary judgment. Summary judgment is appropriate if no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56Copr.. On a motion for summary judgment, the movant has the burden of showing that...