Volkswagen Ag v. Dorling Kindersley Pub., Inc.

• Decision Date: 31 March 2009
• Docket Number: No. 05-72654.,05-72654.
• Citation: 614 F.Supp.2d 793
• Parties: VOLKSWAGEN AG, a German corporation, and Volkswagen of America, Inc., a New Jersey corporation, Plaintiffs, v. DORLING KINDERSLEY PUBLISHING, INC., a Delaware corporation, Defendant.
• Court: U.S. District Court — Eastern District of Michigan

614 F.Supp.2d 793

VOLKSWAGEN AG, a German corporation, and Volkswagen of America, Inc., a New Jersey corporation, Plaintiffs, v. DORLING KINDERSLEY PUBLISHING, INC., a Delaware corporation, Defendant.

No. 05-72654.

United States District Court, E.D. Michigan, Southern Division.

March 31, 2009.

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Cody W. Zumwalt, Gregory D. Phillips, Scott R. Ryther, Howard, Phillips, Salt Lake City, UT, Edward C. Cutlip, Jr., Kerr, Russell, Detroit, MI, for Plaintiff.

Jill M. Wheaton, Kathryn J. Miller, Dykema Gossett, Ann Arbor, MI, for Defendant.

MEMORANDUM OPINION AND ORDER ON SUMMARY JUDGMENT MOTIONS and NOTICE OF STATUS CONFERENCE

DENISE PAGE HOOD, District Judge.

I. INTRODUCTION

This matter is before the Court on Defendant's Motion for Summary Judgment [Dkt. # 59, filed August 31, 2007]. This matter is also before the Court on Plaintiffs' Motion for Summary Judgment [Dkt. # 61, filed August 31, 2007]. Responsive and reply briefs were filed in connection with both motions. A hearing on the motions was held on October 10, 2007.

II. FACTS

This action commenced on July 5, 2005. The Amended Complaint was filed on July 7, 2006. Plaintiffs Volkswagen AG and Volkswagen of America, Inc. (collectively, "VW") assert claims of federal trademark infringement under 15 U.S.C. § 1114 (Count I), false designation of origin and trade dress infringement under 15 U.S.C. § 1125(a) (Count II), dilution under 15 U.S.C. § 1125(c) (Count III), and common law trademark infringement (Count IV). The marks at issue in the Amended Complaint are the VW EMBLEM (USPTO Reg. No. 1,883,332), the BEETLE¹ trademark design and the NEW BEETLE trade dress design (USPTO Reg. No. 2,409,675).

Plaintiffs allege that Defendant Dorling Kindersley Publishing, Inc. ("DK"), a publisher of children's books, infringed and diluted VW's registered trademarks and trade dress with a book that Defendant published, Fun Cars. VW asserts that DK did not have permission from VW to use VW's marks in connection with the NEW BEETLE pictures that DK included in Fun Cars. VW does not dispute that DK had permission to use the marks in connection with the NEW BEETLE pictures that DK included in Big Book of Cars, an earlier publication. The pictures of the NEW BEETLE in Fun Cars are the same as the picture of the NEW BEETLE in the table of contents of Big Book of Cars, except for the color. VW seeks an audit of DK's books, damages, costs, attorney's fees, and a permanent injunction.

DK maintains that it had written permission from VW to use the marks in connection Fun Cars, which was first published in 1999. DK also asserts the affirmative defenses of non-use, First Amendment protection, nominative fair use, laches, and estoppel.

The parties are in dispute as to whether or not the book Fun Cars can be categorized as a toy car or a book. While DK categorizes Fun Cars as a book, VW calls Fun Cars "a children's book designed to function as a toy NEW BEETLE automobile." (VW's Mot. For. Summ. J. at 1.) Fun Cars is a book with ten pressboard pages.² The book has four wheels and is held shut with a velcro strap. Each two-dimensional page is cut in the side view shape of VW's registered NEW BEETLE design. The pictures of the NEW BEETLE in Fun Cars also show, on the side window of the car, a very tiny depiction of the VW EMBLEM mark. The VW EMBLEM mark was attached to the vehicle that DK originally photographed. The NEW BEETLE appears on the front and back covers of the book.

VW alleges that Fun Cars competes directly with and is sold in the same channels as other products which are licensed by VW: a toy NEW BEETLE for Barbie; a toy Hot Wheels NEW BEETLE; and children's book, Wash Me, which is packaged with a toy Matchbox NEW BEETLE. Wash Me is a book with fourteen rectangular-shaped pressboard pages. The Wash Me book tells the story of a NEW BEETLE going through a car wash. The Wash Me book's last page is extended in length to include a packaged toy car.

Before VW initiated the instant suit, the parties attempted to resolve the matter through extra-judicial means. VW alleges that it sought to resolve this dispute through correspondence with DK from 2001 to 2004.

III. ANALYSIS

A. Standard of Review/Applicable Law

Both of the parties have moved the Court for summary judgment. Summary judgment is proper if the record shows 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. Canderm Pharmacal, Ltd. v. Elder Pharmaceuticals, Inc., 862 F.2d 597, 601 (6th Cir.1988). The party moving for summary judgment bears the initial burden and need not support its motion with affidavits or other materials "negating" the opponent's claim. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Adcock v. Firestone Tire & Rubber Co., 822 F.2d 623, 626 (6th Cir.1987). Rather, "the burden on the moving party may be discharged by showing . . . to the district court . . . an absence of evidence to support the nonmoving party's case." Celotex, 477 U.S. at 325, 106 S.Ct. 2548.

Once the moving party has met its burden of production, the nonmoving party must then go beyond the pleadings and by affidavits, or by "depositions, answers to interrogatories, and admissions on file," designate "specific facts showing that there is a genuine issue for trial." Id. at 324, 106 S.Ct. 2548. The nonmoving party must do more than show that there is some metaphysical doubt as to the material facts. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). It must present significant probative evidence in support of its complaint to defeat the motion for summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

When ruling on a summary judgment motion, a district court should view the evidence in a light most favorable to the nonmoving party. Boyd v. Ford Motor Co., 948 F.2d 283, 285 (6th Cir.1991), cert. denied, 503 U.S. 939, 112 S.Ct. 1481, 117 L.Ed.2d 624 (1992). "[S]ummary judgment will not lie if the dispute about a material fact is `genuine,' that is, if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Anderson, 477 U.S. at 248, 106 S.Ct. 2505.

B. DK's Motion for Summary Judgment as to the VW BEETLE and VW EMBLEM Claims

1. VW BEETLE Mark

The Court grants DK's Motion for Summary Judgment in connection with the alleged infringement of VW's BEETLE mark. In the Amended Complaint, VW alleges that DK uses the mark "in prominent lettering" on page 7 of Fun Cars. (Am. Compl. at 9.) The parties' briefs do not present specific arguments as to DK's use of the BEETLE mark on page 7 of Fun Cars. Nevertheless, the Court analyzes this claim in the context of the fair use doctrine.

"Fair use permits others to use a protected mark to describe aspects of their own goods." ETW Corp. v. Jireh Pub., Inc., 332 F.3d 915, 920 (6th Cir.2003) (citation and internal brackets and quotations removed). A court must consider whether defendant has used the mark in its descriptive sense and in good faith in evaluating a defense of fair use. Id. (citations omitted).

The Court has reviewed page 7 of Fun Cars and concludes that DK's use of the BEETLE mark was used in good faith and in its descriptive sense. Id. at 921. The word BEETLE is used only to describe the actual vehicle. Accordingly, "the claim [i]s barred by the fair use defense as a matter of law." Id.

2. VW EMBLEM Mark

The Court also grants DK's Motion for Summary Judgment in connection with the alleged infringement of VW's VW EMBLEM mark. In the Amended Complaint, VW alleges that DK uses a "small but unmistakable counterfeit of the world-famous VW EMBLEM." (Am. Compl. at 9). The parties' briefs do not present specific arguments as to DK's use of the VW EMBLEM mark.

Upon review, the Court concludes that the VW EMBLEM mark's size in relation to the book is very small. The mark is very difficult to discern with the naked eye, unless a viewer gives the book a close inspection or uses the aid of a magnifying device. The Court therefore concludes as a matter of law that there is no possible likelihood of confusion as to the VW EMBLEM mark. See General Motors Corp. v. Keystone Automotive Industries, Inc., 453 F.3d 351, 359 (6th Cir.2006) (noting that if an alleged infringing product is hidden, it "cannot cause . . . confusion as to origin or sponsorship").

Even if the VW EMBLEM mark was larger, the deposition testimony of VW employee, Katherine Thompson, would preclude a finding as to infringement. Ms. Thompson testified that the VW EMBLEM mark was "part of the car" and that VW would not have asked DK to remove it from any of DK's pictures. (Thompson Dep. at 54; Dkt. # 60-20 at 10.) In fact, Ms. Thompson testified that VW would have objected if DK had attempted to remove the mark from any pictures.

The fair use doctrine also bars VW's claim regarding the VW EMBLEM mark. As with the VW BEETLE mark claim, the Court finds that the VW EMBLEM is used only to describe the actual vehicle. Accordingly, the claim is barred by the fair use defense as a matter of law. ETW, 332 F.3d at 921.

The Court now proceeds with its analysis of VW's claims of trademark infringement in connection with VW's NEW BEETLE mark.

C. VW's Motion for Summary Judgment as to its NEW BEETLE Mark

1. Trademark Infringement, Counts I and II

a. Applicable Law

To show trademark infringement under 15 U.S.C. § 1114 (Count I), a plaintiff must show that the use of the allegedly infringing trademark "is likely to cause confusion among consumers regarding the origin of the goods offered by the parties." General Motors Corp. v. Lanard Toys, Inc., 468 F.3d 405, 412 (6th Cir.2006) (citations omitted); see also Daddy's Junky Music Stores, Inc. v. Big Daddy's...