Pacamor Bearings, Inc. v. Minebea Co., Ltd.

• Decision Date: 11 March 1996
• Docket Number: Civil No. 90-271.
• Citation: 918 F. Supp. 491
• Parties: PACAMOR BEARINGS, INC., et al. v. MINEBEA CO., LTD., et al.
• Court: U.S. District Court — District of New Hampshire

918 F. Supp. 491

PACAMOR BEARINGS, INC., et al. v. MINEBEA CO., LTD., et al.

Civil No. 90-271.

United States District Court, D. New Hampshire.

March 11, 1996.

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David M. Cherubin, Daniel M. Sleasman, O'Connell & Aronowitz, Albany, NY, Garry R. Lane, Ransmeier & Spellman, Concord, NH, Salvatore D. Ferlazzo, Ruberti, Girvin & Ferlazzo, Albany, NY, for Pacamor Bearings, Inc., William McCarthy.

H. William Tanaka, Tanaka, Ritger & Middleton, Washington, DC, James L. Kruse, Gallagher, Callahan & Gartrell, P.A., Concord, NH, R. Steven Holt, Arent, Fox, Kintner, Plotkin & Kahn, Washington, DC, Steven J. McAuliffe, U.S. District Court, District of NH, Concord, NH, Michele N. Tanaka, Washington, DC, Jack McKay, Shaw, Pittman, Potts & Trowbridge, Washington, DC, for Minebea Co., Ltd., Nippon Miniature Bearings Corporation, New Hampshire Ball Bearings, Inc.

ORDER

DEVINE, Senior District Judge.

As testament that the modern trend is to litigate on paper rather than in a courtroom, the court has before it for consideration plaintiffs' motion for partial summary judgment, defendants' cross-motion for partial summary judgment, defendants' objection to the magistrate judge's order quashing a discovery subpoena, defendants' objection to the magistrate judge's ruling on document privileges, twelve motions in limine, and the associated objections (and occasional surreplies)¹ thereto. So that this matter may make its final approach to trial, currently calendared to commence on April 16, 1996, the court issues the following orders.

1. Background

This civil action involves two bankrupt entities and several of their former competitors in the miniature and instrument ball bearings market. Following numerous pretrial proceedings, the following three claims remain: (1) that defendants violated the Lanham Act, 15 U.S.C. § 1125; (2) that defendants violated New Hampshire's law against unfair trade practices, New Hampshire Revised Statutes Annotated (RSA) 358-A, and/or engaged in unfair competition violative of New Hampshire common law; and (3) that defendants intentionally and improperly interfered with plaintiffs' business relations.

2. Plaintiffs' Motion and Defendants' Cross-Motion²

Plaintiffs move for summary judgment, as to liability, on their claims that defendants' conduct violated the Lanham Act, the New Hampshire Consumer Protection Act, and state common law regarding unfair competition, leaving the "appropriate amount of compensatory damages ... enhanced and punitive damages, prejudgment interest and attorney fees" for determination by the jury. Plaintiffs' Memorandum of Law at 2. Defendants, by medium of cross-motion, indicate that plaintiffs' Lanham Act claim is unrecognized in this circuit — if characterized as a claim for false advertising — and the state Consumer Protection Act does not include business competitors within the class the Legislature intended to protect. Failing these two arguments, defendants utilize a fall-back position, essentially arguing that genuine issues remain regarding the causal nexus between their alleged conduct and plaintiffs' asserted injury — a purported element of plaintiffs' Lanham Act claim — making summary judgment inappropriate. Because the issues raised in the motion and cross-motion are identical, the court will discuss and resolve same in unison.

a. Summary Judgment Standard

Summary judgment shall be ordered when "there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law." Rule 56(c), Fed.R.Civ.P. Since the purpose of summary judgment is issue finding, not issue determination, the court's function at this stage "`is not to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.'" Stone & Michaud Ins., Inc. v. Bank Five for Savings, 785 F.Supp. 1065, 1068 (D.N.H. 1992) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2510-11, 91 L.Ed.2d 202 (1986)). Although "motions for summary judgment must be decided on the record as it stands, not on litigants' visions of what the facts might some day reveal," Maldonado-Denis v. Castillo-Rodriguez, 23 F.3d 576, 581 (1st Cir.1994), the entire record will be scrutinized in the light most favorable to the nonmovant, with all reasonable inferences indulged in that party's favor, Smith v. Stratus Computer, Inc., 40 F.3d 11, 12 (1st Cir.1994), cert. denied, ___ U.S. ___, 115 S.Ct. 1958, 131 L.Ed.2d 850 (1995); see also Woods v. Friction Materials, Inc., 30 F.3d 255, 259 (1st Cir.1994); Maldonado-Denis, supra, 23 F.3d at 581.

"In general ... a party seeking summary judgment is required to make a preliminary showing that no genuine issue of material fact exists." National Amusements, Inc. v. Town of Dedham, 43 F.3d 731, 735 (1st Cir.) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986)), cert. denied, ___ U.S. ___, 115 S.Ct. 2247, 132 L.Ed.2d 255 (1995).

A "genuine" issue is one that properly can be resolved only by a finder of fact because it may reasonably be resolved in favor of either party. Maldonado-Denis, 23 F.3d at 581. In other words, a genuine issue exists "if there is `sufficient evidence supporting the claimed factual dispute' to require a choice between `the parties' differing versions of the truth at trial.'" Id. (quoting Garside v. Osco Drug, Inc., 895 F.2d 46, 48 1st Cir.1990). A "material" issue is one that might affect the outcome of the suit under the governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986).

Libertad v. Welch, 53 F.3d 428, 435 (1st Cir.1995).

"`The evidence illustrating the factual controversy cannot be conjectural or problematic; it must have substance in the sense that it limns differing versions of the truth which a factfinder must resolve....'" National Amusements, supra, 43 F.3d at 735 (quoting Mack v. Great Atl. & Pac. Tea Co., 871 F.2d 179, 181 (1st Cir.1989)). Accordingly, "purely conclusory allegations, ... rank speculation, or ... improbable inferences" may be properly discredited by the court, id. (citing Medina-Munoz v. R.J. Reynolds Tobacco Co., 896 F.2d 5, 8 (1st Cir.1990)), and "`are insufficient to raise a genuine issue of material fact,'" Horta v. Sullivan, 4 F.3d 2, 8 (1st Cir.1993) (quoting August v. Offices Unlimited, Inc., 981 F.2d 576, 580 (1st Cir.1992)).

b. Lanham Act

Citing to precedent deep within the annals of First Circuit jurisprudence, e.g., Samson Crane Co. v. Union Nat'l Sales, Inc., 87 F.Supp. 218 (D.Mass.1949), aff'd, 180 F.2d 896 (1st Cir.1950) (per curiam), defendants assert that plaintiffs' false advertising claim is not cognizable by the First Circuit as a proper Lanham Act § 43(a) cause of action.³ Cf. Camel Hair and Cashmere Inst. v. Associated Dry Goods Corp., 799 F.2d 6, 11 (1st Cir.1986) ("the dispositive question in determining whether a plaintiff is a proper person to bring a claim under the Lanham Act, is whether the plaintiff has a reasonable interest in being protected against false advertising") (citing Quabaug Rubber Co. v. Fabiano Shoe Co., 567 F.2d 154, 160 (1st Cir.1977)). Defendants attempt to bolster this assertion by citation to a more recent case out of the circuit, Clamp-All Corp. v. Cast Iron Soil Pipe Inst., 851 F.2d 478 (1st Cir.1988), cert. denied, 488 U.S. 1007, 109 S.Ct. 789, 102 L.Ed.2d 780 (1989), wherein the panel declined, on the force of plaintiff's failure of proof, to revisit its narrow — and minority — interpretation of section 43(a)'s scope. Reconsideration of its Samson Crane holding was postponed, in the words of the circuit, "for another day." Clamp-All Corp., supra, 851 F.2d at 491. That day seems to have arrived.

Although this litigation is governed by the pre-1988 amendments to section 43(a), the ensuing change in the statutory language does not compel the court to an alternate ruling.⁴ Indeed, the Supreme Court has noted that even under the language of the 1946 enactment the phrase "false description or representation" was construed narrowly to encompass "two kinds of wrongs: false advertising and the common-law tort of `passing off.' False advertising meant representing that goods or services possessed characteristics that they did not actually have and passing off meant representing one's goods as those of another." Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 778, 112 S.Ct. 2753, 2762, 120 L.Ed.2d 615 (1992) (Stevens, J., concurring) (footnotes omitted). Moreover, the 1988 amendments merely served to "codify the interpretations section 43(a) has been given by the courts ... where it has been widely interpreted as creating, in essence, a federal law of unfair competition ... applicable to actionable false advertising claims." S.Rep. No. 100-515, 100th Cong., 2d Sess. 40 (1988), re-printed in 1988 U.S.C.C.A.N. 5577, 5603.

Thirteen years ago Judge Selya, then sitting as a district court judge in Rhode Island, limned that "a review of the history of the federal trademark legislation, however, leads to the conclusion that Samson Crane's narrow interpretation of § 1125(a) is erroneous, and should not be followed by this court." Schroeder v. Lotito, 577 F.Supp. 708, 722 (D.R.I.1983). This mantra has been picked up most recently by Judge Young, from the District of Massachusetts, when he opined, "there is little doubt that the amended statute codifies the dominant expansive interpretation of the old statute. In so doing, the amendment has consigned Samson Crane and its progeny to the dustbin of First Circuit jurisprudence." Kasco Corp. v. General Servs., Inc., 905 F.Supp. 29, 34 (D.Mass.1995) (footnote omitted). The court finds the reasoning of said cases to be persuasive on such issue, and thus finds and rules that plaintiffs' allegations state a valid cause of action for false advertising...