Synergistic Intern., LLC v. Korman

• Decision Date: 20 October 2005
• Docket Number: No. CIV.A. 2:05CV49.,CIV.A. 2:05CV49.
• Citation: 402 F.Supp.2d 651
• Court: U.S. District Court — Eastern District of Virginia
• Parties: SYNERGISTIC INTERNATIONAL, LLC, Plaintiff, v. Jody Fine KORMAN, individually, And d/b/a the Windshield Doctor®, a Windshield Doctor, and Glass Doctor, Defendants.

Page 651

402 F.Supp.2d 651

SYNERGISTIC INTERNATIONAL, LLC, Plaintiff, v. Jody Fine KORMAN, individually, And d/b/a the Windshield Doctor®, a Windshield Doctor, and Glass Doctor, Defendants.

No. CIV.A. 2:05CV49.

United States District Court, E.D. Virginia, Norfolk Division.

October 20, 2005.

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COPYRIGHT MATERIAL OMITTED

Christopher P. Bussert, William M. Bryner and Jay Sullivan, of Kilpatrick Stockton LLP, Atlanta, GA, for Plaintiff.

Michael R. Katchmark and Brett A. Spain of Willcox and Savage in Norfolk, as well as local counsel.

Bradley D. Goldizen and James J. McElligott III of Goldizen & Associates in Virginia Beach, for the Defendant.

OPINION AND ORDER

MORGAN, Senior District Judge.

This matter came before the Court on cross-motions for summary judgment. Defendant moved for summary judgment (Doc. 17) and Plaintiff filed a cross-motion for summary judgment (Doc. 23). By letter dated September 9, 2005, the Court informed the parties that it would grant summary judgment on liability to Plaintiff and hear evidence and argument concerning the remaining issue of appropriate relief on September 19, 2005. This Order explains the Court's ruling and sets forth the Court's findings with respect to damages.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY:¹

Plaintiff Synergistic International, LLC, [hereinafter "Synergistic"] is a nationwide franchisor and operator of a glass installation and repair service system operating under the name GLASS DOCTOR®. Defendant Jody Fine Korman [hereinafter "Korman"] is the owner/operator of a windshield repair business in the Virginia Beach area under the service mark "The Windshield Doctor" (the "THE WINDSHIELD DOCTOR® Mark").

On May 31, 1977, one of Synergistic's predecessors-in-interest received from the United States Patent and Trademark Office (the "USPTO") United States Service Mark Reg. No. 1,066,929 on the Principal Register, covering the service mark "GLASS DOCTOR," in block letters, for use in connection with "installation of glass in buildings and vehicles" (the "GLASS DOCTOR® Registration"). Stipulation of Undisputed Facts [hereinafter "UF"] 31. Synergistic is the current owner of the GLASS DOCTOR® Registration, and the GLASS DOCTOR® Registration remains in full force and effect. Id. The GLASS DOCTOR® Registration was issued by the USPTO without requiring proof of secondary meaning under Lanham Act § 2(f), 15 U.S.C. § 1052(f). Id. The GLASS DOCTOR® Registration has become incontestable pursuant to Lanham Act § 15, 15 U.S.C. § 1065, because the GLASS DOCTOR® Mark shown therein has been in continuous use in commerce for more than five years from the date of registration and because the required affidavit of incontestability has been filed with, and accepted by, the USPTO. Id.

In 1987, Korman began operating a windshield repair business in the Virginia Beach area under the service mark "The Windshield Doctor" (the "THE WINDSHIELD DOCTOR® Mark"). UF 18. In 2002, Korman filed an application with the USPTO to register her THE WINDSHIELD DOCTOR® Mark. UF 22. On December 9, 2003, the USPTO granted Korman U.S. Service Mark Reg. No. 2,790,862 for her THE WINDSHIELD DOCTOR® Mark for use in connection with "repair services, namely, vehicle windshield repairs for cracks, chips and stars in windshields." UF 23.

In addition to "THE WINDSHIELD DOCTOR," Korman has also used the service marks "A WINDSHIELD DOCTOR," "WINDSHIELD DOCTOR" and "DOCTOR WINDSHIELD" in association with her WINDSHIELD DOCTOR Business. UF 34. Korman has also used the service mark "GLASS DOCTOR" in connection with her WINDSHIELD DOCTOR Business (her "GLASS DOCTOR Mark"). UF 35. Korman testified that she adopted her GLASS DOCTOR Mark in connection with her WINDSHIELD DOCTOR Business in 2000. Id. Korman has used her WINDSHIELD DOCTOR Marks and her GLASS DOCTOR Mark interchangeably in commerce — offering the same service to the same customers at the same prices in the same advertising media in Virginia Beach, Norfolk, Chesapeake, and Portsmouth, Virginia. UF 38. Korman's use of her WINDSHIELD DOCTOR Marks and her GLASS DOCTOR Mark was and is without oral or written authorization from Synergistic. Id.

Neither Synergistic nor any of its predecessors-in-interest actually used the GLASS DOCTOR® Mark in commerce in the Virginia Beach area in connection with windshield repair services prior to 1987. UF 14. In the Spring of 2005, Synergistic converted, or "re-flagged," a former Harmon AutoGlass franchise located in Virginia Beach, Virginia, to operate under the GLASS DOCTOR® Mark and to provide glass installation, replacement and repair services, specifically including automobile glass repair services, in Virginia Beach, Norfolk, Chesapeake, Portsmouth, and Suffolk, Virginia (the "Virginia Beach area"). UF 26, 33. In the Summer of 2005, the signage and related promotional/advertising materials relating to this location were changed to show operation under the GLASS DOCTOR® Mark. Id.

On August 25, 2004, Synergistic's in-house counsel sent a certified letter to Korman informing her of Synergistic's prior and superior rights in the GLASS DOCTOR® Mark and requesting the immediate cessation of Korman's use of her WINDSHIELD DOCTOR Marks and her GLASS DOCTOR Mark in connection with her WINDSHIELD DOCTOR Business. UF 50. Korman ceased her advertising for her GLASS DOCTOR Mark upon receipt of this letter, but continued to use her WINDSHIELD DOCTOR Marks in connection with her WINDSHIELD DOCTOR Business. Id.

On January 22, 2005, Synergistic filed a complaint alleging five causes of action: (1) service mark infringement under Section 32 of the Trademark Act of 1946 [hereinafter the "Lanham Act"], 15 U.S.C. § 1114; (2) necessary cancellation of Federal Trademark Registration under Section 2 of the Lanham Act, 15 U.S.C. § 1052;² (3) federal unfair competition in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a); (4) unfair methods of competition and unfair or deceptive trade practices under Virginia state law; and (5) common law unfair competition in violation of the common law of Virginia. Compl. at pp. 1-2. Korman³ filed her motion for summary judgment on August 2, 2005. Synergistic filed its cross-motion for summary judgment on August 15, 2005. The motions were not set for hearing because, collectively, they did not mature until after the fed. R. Civ. P. 16(d) Final Pretrial Conference; however, the parties consented to have the motions determined on the briefs submitted.

II. STANDARD OF REVIEW:

Summary judgment is proper only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." fed. R. Civ. P. 56(c); see also Miller v. Leathers, 913 F.2d 1085, 1087 (4th Cir.1990). The facts and inferences drawn from the pleadings must be viewed in the light most favorable to the nonmoving party. Nguyen v. CNA Corp., 44 F.3d 234, 237 (4th Cir.1995). Summary judgment is appropriate when the record, taken as a whole, could not lead a rational trier of fact to find for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-49, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

In order to successfully defeat a motion for summary judgment, a nonmoving party cannot rely on "mere belief or conjecture, or the allegations and denials contained in the pleadings." Doyle v. Sentry Ins., 877 F.Supp. 1002, 1005 (E.D.Va.1995) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)). Rather, the nonmoving party must set forth specific facts through affidavits, depositions, interrogatories, or other evidence to show genuine issues for trial. Celotex, 477 U.S. at 324, 106 S.Ct. 2548. These specific facts must be such that a rational trier of fact could base a finding for the nonmovant upon them. "The mere existence of a scintilla of evidence ... will be insufficient." Anderson, 477 U.S. at 252, 106 S.Ct. 2505.

III. ANALYSIS:

The United States Court of Appeals for the Fourth Circuit has recognized that "the test for trademark infringement and unfair competition under the Lanham Act is essentially the same as that for common law unfair competition under Virginia law because both address the likelihood of confusion as to the source of the goods or services involved." Lone Star Steakhouse & Saloon, Inc., v. Alpha of Virginia, Inc., 43 F.3d 922 (4th Cir.1995).⁴ "The likelihood of confusion is a factual issue dependent on the circumstances of each case. See Petro Stopping Ctrs., L.P. v. James River Petroleum, Inc., 130 F.3d 88, 92 (4th Cir.1997). Nevertheless, summary judgment is appropriate when the material, undisputed facts disclose a likelihood of confusion. See Lone Star, 43 F.3d at 935." Resorts of Pinehurst, Inc., v. Pinehurst National Corporation, et al., 148 F.3d 417, 422 (4th Cir.1998). Likelihood of confusion is but the second half of the test for trademark infringement and unfair competition; the first half requires a complainant to "demonstrate that it has a valid, protectible trademark...." Lone Star, 43 F.3d at 930. The Court will address each half of the test in turn.

A. Valid, Protectible Trademark

The parties stipulate that Synergistic is the current owner of the GLASS DOCTOR® Registration; that the registration remains in full force and effect; and that the GLASS DOCTOR® Registration has become incontestable. UF 31. Because "incontestability is `conclusive evidence of the validity of the registered mark and of the registration of the mark, and of the registrant's exclusive right to use the mark in commerce,' 15 U.S.C. § 1115(b)," it is not surprising that the parties further agree that the GLASS DOCTOR® Mark qualifies for legal protection. UF 51; see also Lone Star, 43 F.3d at 930. The question is the scope of legal protection for which the mark...