Weems Indus., Inc. v. Teknor Apex Co.

• Decision Date: 18 May 2021
• Docket Number: No. C20-108-LTS,C20-108-LTS
• Parties: WEEMS INDUSTRIES, INC. d/b/a Legacy Manufacturing Company, Plaintiff, v. TEKNOR APEX COMPANY, Defendant.
• Court: U.S. District Court — Northern District of Iowa

540 F.Supp.3d 839

WEEMS INDUSTRIES, INC. d/b/a Legacy Manufacturing Company, Plaintiff,

v.TEKNOR APEX COMPANY, Defendant.

No. C20-108-LTS

United States District Court, N.D. Iowa, Cedar Rapids Division.

Signed May 18, 2021

Daniel P. Kresowik, Brian J. Laurenzo, Andrew Joseph Morgan, Dennis P. Ogden, Brick Gentry PC, West Des Moines, IA, for Plaintiff Weems Industries, Inc.

Spencer S. Cady, Nyemaster Goode, Des Moines, IA, Cheryl L. Farine, Dan Hudak, Michael Willis Vary, Hudak Shunk & Farine Co. LPA, Tallmadge, OH, for Defendant.

ORDER ON DEFENDANT'S MOTION TO DISMISS

Leonard T. Strand, Chief Judge

I. INTRODUCTION

This case is before me on a motion (Doc. 29) to dismiss filed by defendant Teknor Apex Company (Teknor). Teknor argues that the amended complaint (Doc. 21) filed by plaintiff Weems Industries, Inc. (Weems), should be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6). Alternatively, Teknor argues that Weems should be ordered under Rule 12(e) to provide a more definite statement regarding which of Teknor's products infringe on its trademark. Weems has filed a resistance (Doc. 30) and Teknor has replied (Doc. 31). Oral argument is not necessary. See Local Rule 7(c).

II. BACKGROUND

Weems is an Iowa corporation that manufactures and sells hose products through its subsidiary, Legacy Manufacturing Company.¹ In 2007, Weems began producing some of its hose products, specifically compressed air hoses, in the color chartreuse.² Chartreuse is not a natural by-product of the hose-manufacturing process, nor is it the natural color of materials needed to produce them. Additionally, producing a hose in chartreuse is no less expensive than production in any other color. Weems expanded its use of the color chartreuse to other products, including water hoses, beginning in 2009.

Weems asserts that it has invested substantial time, effort and millions of dollars to develop, distinguish, promote and market its chartreuse-colored hoses. It has marketed them under the trademark "FlexZilla®" and has referred to its chartreuse color as "ZillaGreen™." It has also used the slogan, "If it's not ZillaGreen,™ it's not FlexZilla.®" Thus, chartreuse has become Weems’ signature color and customers associate it with Weems’ products.

In September 2017, Weems registered the color chartreuse as a trademark of the exterior body of certain water hoses. See Registration No. 5,293,921 (‘921 Registration or chartreuse trademark).³ Weems’ depicted the chartreuse mark with the following drawing:

The registration lists the first day of use in commerce as May 1, 2009. Id.

Teknor is a Delaware corporation that also produces and sells hoses. In July 2018, Weems sent a letter to Teknor regarding possible infringement of its chartreuse trademark. Teknor responded by denying that any of its products, or planned products, would infringe on Weems’ trademark. However, Teknor proceeded to produce, market and sell at least two types of water hoses – its NexFlex and Zero-G Pro models – that Weems claims are confusingly similar to its chartreuse hoses. In response to the parties’ disagreement regarding infringement, Teknor filed a petition to cancel Weems’ ‘921 Registration in March 2020.

Weems filed a complaint in this court on November 13, 2020, alleging that Teknor is liable for trademark infringement and unfair competition. Doc. 1. It seeks (1) an injunction prohibiting Teknor from producing hoses in chartreuse or any other color likely to be confused with chartreuse, (2) an order pursuant to 15 U.S.C. § 1116(a) directing Teknor to file a written report under oath specifying the steps it has taken to comply with the injunction, (3) an order pursuant to 15 U.S.C. § 1118 requiring Teknor to destroy all infringing products and marketing materials, (4) monetary remedies in the form of damages from lost sales and goodwill as well as Teknor's profits derived from its infringing products, (5) attorney's fees and costs and (6) any other relief the court deems just and necessary. Id. Teknor responded by filing a motion (Doc. 13) to dismiss for failure to state a claim. Weems then filed its amended complaint (Doc. 21), asserting the same claims, and Teknor filed its present motion (Doc. 29) to dismiss.

III. APPLICABLE STANDARDS

The Federal Rules of Civil Procedure authorize a pre-answer motion to dismiss for "failure to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). The Supreme Court has provided the following guidance in considering whether a pleading properly states a claim:

Under Federal Rule of Civil Procedure 8(a)(2), a pleading must contain a "short and plain statement of the claim showing that the pleader is entitled to relief." As the Court held in [ Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 127 S. Ct. 1955, 167 L.Ed.2d 929 (2007) ], the pleading standard Rule 8 announces does not require "detailed factual allegations," but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation. Id. , at 555, 127 S. Ct. 1955 (citing Papasan v. Allain , 478 U.S. 265, 286, 106 S. Ct. 2932, 92 L.Ed.2d 209 (1986) ). A pleading that offers "labels and conclusions" or "a formulaic recitation of the elements of a cause of action will not do." 550 U.S. at 555, 127 S. Ct. 1955. Nor does a complaint suffice if it tenders "naked assertion[s]" devoid of "further factual enhancement." Id. , at 557, 127 S. Ct. 1955.

To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face." Id. , at 570, 127 S. Ct. 1955. A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Id. , at 556, 127 S. Ct. 1955. The plausibility standard is not akin to a "probability requirement," but it asks for more than a sheer possibility that a defendant has acted unlawfully. Ibid. Where a complaint pleads facts that are "merely consistent with" a defendant's liability, it "stops short of the line between possibility and plausibility of ‘entitlement to relief.’ " Id. at 557, 127 S. Ct. 1955 (brackets omitted).

Ashcroft v. Iqbal , 556 U.S. 662, 677-78, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009).

Courts assess "plausibility" by " ‘draw[ing] on [their own] judicial experience and common sense.’ " Whitney v. Guys, Inc. , 700 F.3d 1118, 1128 (8th Cir. 2012) (quoting Iqbal , 556 U.S. at 679, 129 S.Ct. 1937 ). Also, courts " ‘review the plausibility of the plaintiff's claim as a whole, not the plausibility of each individual allegation.’ " Id. (quoting Zoltek Corp. v. Structural Polymer Grp. , 592 F.3d 893, 896 n.4 (8th Cir. 2010) ). While factual "plausibility" is typically the focus of a Rule 12(b)(6) motion to dismiss, federal courts may dismiss a claim that lacks a cognizable legal theory. See, e.g., Somers v. Apple, Inc. , 729 F.3d 953, 959 (9th Cir. 2013) ; Ball v. Famiglio , 726 F.3d 448, 469 (3d Cir. 2013) ; Commonwealth Prop. Advocates, L.L.C. v. Mortg. Elec. Registration Sys., Inc. , 680 F.3d 1194, 1202 (10th Cir. 2011) ; accord Target Training Intern., Ltd. v. Lee , 1 F. Supp. 3d 927 (N.D. Iowa 2014).

In considering a Rule 12(b)(6) motion to dismiss, ordinarily the court "cannot consider matters outside the pleadings without converting the motion into a motion for summary judgment." McMahon v. Transamerica Life Ins. , No. C17-149-LTS, 2018 WL 3381406, at *2 n.2 (N.D. Iowa July 11, 2018) ; see Fed. R. Civ. P. 12(b)(6). On the other hand, when a copy of a "written instrument" is attached to a pleading, it is considered "a part of the pleading for all purposes," pursuant to Federal Rule of Civil Procedure 10(c). Thus, when the pleadings necessarily embrace certain documents, I may consider those documents without turning a motion to dismiss into a motion for summary judgment. Id. These documents include "exhibits attached to the complaint." Mattes v. ABC Plastics, Inc. , 323 F.3d 695, 697 n.4 (8th Cir. 2003).

When a complaint does not state a claim for relief that is plausible on its face, the court must consider whether it is appropriate to grant the pleader an opportunity to replead. The rules of procedure permit a party to respond to a motion to dismiss by amending the challenged pleading "as a matter of course" within 21 days. See Fed. R. Civ. P. 15(a)(1)(B). Thus, when a motion to dismiss highlights deficiencies in a pleading that can be cured by amendment, the pleader has an automatic opportunity to do so. When the pleader fails to take advantage of this opportunity, the question of whether to permit an amendment depends on considerations that include:

whether the pleader chose to stand on its original pleadings in the face of a motion to dismiss that identified the very deficiency upon which the court dismissed the complaint; reluctance to allow a pleader to change legal theories after a prior dismissal; whether the post-dismissal amendment suffers from the same legal or other deficiencies as the dismissed pleading; and whether the post-dismissal amendment is otherwise futile.

Meighan v. TransGuard Ins. Co. of Am. , 978 F. Supp. 2d 974, 982 (N.D. Iowa 2013).

Rule 12(e) allows a party to move for a more definite statement "of a pleading to which a responsive pleading is allowed but which is so vague or ambiguous that the party cannot reasonably prepare a response." Fed. R. Civ. P. 12(e). The motion must "point out the defects complained of and the details desired." Id.

IV. DISCUSSION

Weems asserts five claims for relief:

(1) trademark infringement under the Lanham Act, 15 U.S.C. § 1114(1) ;

(2) common law trademark infringement under the Lanham Act, 15 U.S.C. § 1125(a) ;⁴

(3) unfair competition under the Lanham Act, 15 U.S.C. § 1125(a) ;

(4) unfair competition under Iowa common law; and

(5) unjust enrichment.

The first four claims, though distinct causes of action, are essentially identical in this case. See Heaton Distrib. Co. v....