Yankee Candle Company v. Bridgewater Candle Co.

• Decision Date: 27 July 2000
• Docket Number: No. 98-30226-MAP.,98-30226-MAP.
• Citation: 107 F.Supp.2d 82
• Parties: The YANKEE CANDLE COMPANY, INC. v. The BRIDGEWATER CANDLE COMPANY, LLC.
• Court: U.S. District Court — District of Massachusetts

107 F.Supp.2d 82

The YANKEE CANDLE COMPANY, INC. v. The BRIDGEWATER CANDLE COMPANY, LLC.

No. 98-30226-MAP.

United States District Court, D. Massachusetts.

July 27, 2000.

Mary R. Bonzagni, Law Offices of Donald S. Holland, Longmeadow, MA, Donald S. Holland, Holland & Bonzagni, P.C., Longmeadow, MA, Gregory L. Baker, Howrey Simon Arnold & White, Washington, DC, Colin Foley, Howrey Simon Arnold & White, Washington, DC, Cecil E. Key, Jr., Baker Botts, L.L.P., The Warner, Washington, DC, for Yankee Candle Company, plaintiff.

Bruce R. Parker, Katherine M. Hamill, Foley, Hoag & Eliot, Boston, MA, Jeffrey M. Karmilovich, Richard M. Moose, Dority & Manning, Greenville, SC, Michael A. Albert, Wolf, Greenfield & Sacks, Boston, MA, for Bridgewater Candle Company, LLC, defendant.

Kathleen A. Linert, Morrison, Mahoney & Miller, Boston, MA, for R.E.P.S., movant.

MEMORANDUM REGARDING DEFENDANT'S MOTION TO DEFINE SCOPE OF TRIAL AND PLAINTIFF'S MOTION FOR ENTRY OF JUDGMENT PURSUANT TO RULE 54(b) OR FOR CERTIFICATION PURSUANT TO 28 U.S.C. § 1292(b)

PONSOR, District Judge.

I. BACKGROUND

The parties are both candle makers. Yankee Candle alleges that Bridgewater Candle has misappropriated its intellectual property, mainly by infringing its copyrights and unfairly exploiting its trade dress. The court has recently allowed, in part, Bridgewater's motion for summary judgment. Resolution of the motions now at issue will define the next phase of the litigation. Before addressing these motions directly, some description of the course of the case to date is necessary.

This complaint asserts five counts, each offering a distinct theory: statutory copyright, statutory trade dress, common law trade dress, common law tortious interference with contractual relations and statutory unfair trade practices pursuant to Mass.Gen.Laws ch. 93A.

On June 8, 2000 the court allowed the defendant's Motion for Summary Judgment on the first three counts. In brief, the reasons were as follows.

With regard to the copyright claim in Count I, the court concluded preliminary that the design elements identified by the plaintiff were mainly not protectable. As to those elements that might, perhaps, be protectable, plaintiff's claims failed the "ordinary observer" test — i.e., no reasonable person could conclude the elements were copied by Bridgewater. Since plaintiff's copyright claims were without legal or factual support, and no jury could conclude otherwise, summary action was appropriate.

The Supreme Court's recent decision in Wal-Mart Stores, Inc. v. Samara Brothers, Inc., 529 U.S. 205, 120 S.Ct. 1339, 146 L.Ed.2d 182 (2000), crushed most, if not all, of the life out of plaintiff's statutory trade dress claim in Count II. Wal-Mart drew a crisp distinction between "product design" and "product packaging" claims in trade dress cases. Lawsuits within the product packaging category enjoy a more generous scope of possible proof; a plaintiff may prevail by showing either "inherent distinctiveness" or secondary meaning. In contrast, a plaintiff whose trade dress claim resides within the product design pigeon hole must rely exclusively on secondary meaning. Because of the more expansive evidentiary environment in a product packaging claim, a litigant relying on this theory must assert trade dress features that serve to identify the product's source, such as a name or unique label. In underlining the importance of this requirement Justice Scalia offered an explicit caveat:

To the extent there are close cases, we believe that courts should err on the side of caution and classify ambiguous trade dress as product design, thereby requiring secondary meaning.

Id. at 1346.

Here, Yankee Candle's trade dress claims — focusing on the "look and feel" of its Housewarmer line, its vertical display system and its catalogue layout — do not present even a "close case." They are clearly (plaintiff's protestations to the contrary notwithstanding) in the "package design" category. As set down by Wal-Mart, therefore, the plaintiff's trade dress is protectable only to the extent that it has acquired secondary meaning; no claim of "inherent distinctiveness" is viable.

A close examination of the record in this case confirms the complete absence of any significant evidence that would support a finding of secondary meaning. The trade dress sought to be protected has not been in circulation for a sufficient period of time to support secondary meaning as a matter of law, and plaintiff's advertising makes no use of the trade dress elements for product identification, as in the case of a label or name.

The Supreme Court's unanimous decision in Wal-Mart emphatically underscores the importance of an exacting analysis of trade dress claims and spells out the evils that flow from overprotection of product design.

Consumers should not be deprived of the benefits of competition with regard to the utilitarian and esthetic purposes that product design ordinarily serves by a rule of law that facilitates plausible threats of suit against new entrants based upon alleged inherent distinctiveness.

Id. at 1344.

The glaring absence of legal or factual support for Yankee Candle's copyright and trade dress claims raises precisely the concerns highlighted in this passage. As Justice Scalia suggests, the danger of this kind of litigation is that its effect, and perhaps even its goal, will not be legitimate protection of creative effort, but rather suppression of fair competition. In view of Wal-Mart, the deficiencies in the record made allowance of defendant's motion for summary judgment on the statutory trade dress claim inevitable.

Having allowed summary judgment on the statutory copyright and trade dress claims in Counts I and II, and with no argument that the common law trade dress count should be treated differently, the court also allowed the defendant's motion with regard to Count III.

The remaining two counts were addressed briefly. The court found record support for the claim, specified in the complaint, that Bridgewater sales agents had made certain misrepresentations to Yankee customers and that Yankee had suffered damage as a result. This, the court found, was sufficient to justify denial of the defendant's motion on Count IV, the claim for tortious interference with contractual relations.

Count V, for violation of Ch. 93A, was also found to be viable, based on the specific acts of misrepresentation alleged in Count IV, which were supported, to some extent, by the record. The court made it clear, however that "the allowance of the motions for summary judgment on the copyright and Lanham Act claims disposes of those theories to the extent that plaintiff might otherwise offer those underlying facts as support for the Ch. 93(A) claim." Memorandum at 43.¹

With three of the five counts disposed of, the question becomes, where does the case go from here? Bridgewater's Motion to Define the Scope of Trial, and Yankee's Motion for Entry of Final Judgment offer strongly contrasting views of the next stage.

II. DISCUSSION

A. Defendant's Motion to Define the Scope of Trial

The essence of Bridgewater's argument in support of this motion is that the issues raised by the remaining two counts, and the concomitant scope of the evidence at the upcoming trial, are relatively narrow. Allowance of its motion would confirm this and shape the proceedings appropriately. Bridgewater seeks a short, prompt trial.

Yankee Candle takes the position that the rulings on the motion for summary judgment have not significantly compressed the issues or the evidence at the trial to come. In other words, in Yankee's view, most, if not all, of the documents and testimony that would have been offered at the trial of all five counts must still be presented at the trial of the tortious interference and Ch. 93A counts. As will be seen below, Yankee argues from this that the most efficient, and the fairest, path for the case at its present juncture is towards the Court of Appeals. By holding off trial on the remaining two counts, and permitting interlocutory review by the First Circuit of the summary judgment rulings, Yankee says, the worst-case possibility of a lengthy trial on Counts IV and V now, and an equally lengthy trial of Counts I through III on remand (each with virtually the same evidence) will be avoided.

An examination of the complaint, and an analysis of the effect of the summary judgment rulings, makes it clear that Bridgewater has the stronger argument.²

The court denied defendant's motion for summary judgment on Count IV after recognizing a narrowly defined area of factual dispute supported in the record. The complaint charges that Bridgewater tortiously interfered with Yankee's contractual relations in four specific ways. Bridgewater's sales agents (1) disseminated "false and misleading information regarding Yankee Candle;" (2) "disparaged" plaintiff's products; (3) contacted plaintiff's customers "for the purpose of informing them that Yankee could or would no longer service their needs;" and (4) directly solicited business from Yankee's customers. Verified Complaint at 22, para. 110. Because the court found that there was sufficient, though minimal, evidence in the record to support these specific claims, Bridgewater's motion on this count was denied.

Yankee contends that a narrow construction of Count IV is improper, for at least two reasons. First, Count IV, at para. 108, incorporates all the allegations of the previous 107 paragraphs into the claim for tortious interference, and para. 110 states that the interference consisted of "at least" the four specified actions. To a careful reader, these two details would supposedly suggest that, in fact, Yankee intended to offer all the evidence supporting the copyright and trade dress count as a basis for the claim of tortious interference with contractual relations.

The court cannot agree. If the plaintiff really intended the evidence...