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CSL Silicones, Inc. v. Midsun Group Inc.

United States District Court, D. Connecticut

March 15, 2016

CSL SILICONES INC., Plaintiff,
v.
MIDSUN GROUP INC., Defendant.

RULING ON MOTIONS TO DISMISS AND FOR JUDICIAL NOTICE

Charles S. Haight, Jr. Senior United States District Judge

Plaintiff CSL Silicones Inc. ("CSL"), a Canadian corporation, brings this action against Defendant Midsun Group Inc. ("Midsun"), a Connecticut corporation, in connection with Defendant's allegedly improper use of two of Plaintiff's trademarks. Plaintiff alleges that Defendant markets and sells a silicone-coating product under a name similar to Plaintiff's chosen name for its silicone-coating product and that Defendant is thereby in violation of various provisions of the federal Lanham Act, 15 U.S.C. § 1051 et. seq, as well as Connecticut's Unfair Trade Practices Act ("CUTPA"), C.G.S. § 42-110. Defendant has filed a motion to dismiss each of Plaintiff's causes of action as either time-barred or precluded by res judicata, [Doc. 10], and, in furtherance of its argument, moves this Court to take judicial notice of relevant proceedings before the United States Patent and Trademark Office ("USPTO"), [Doc. 11]. Plaintiff objects to both motions [Doc. 19], and Defendant has filed a single reply, [Doc. 20]. The Court held a hearing on the motions on January 8, 2016. Doc. 56. This Ruling resolves them both.

I. Background

A. Allegations in the Complaint

CSL develops and sells silicone-based coatings for various applications, earning a status as a "global leader" in the field. Compl. [Doc. 1] ¶ 6. Relevant here, it sells two such coatings, both of which are "room temperature vulcanizing silicone coating" products. Id. ¶¶ 7-8. One, marketed and sold with the mark "570, " is used largely to coat and thereby protect high voltage insulators, such as overhead power lines. Id. ¶ 7. The other, carrying the mark "579, " is used largely to protect against corrosion of various steel products. Id. ¶ 8. CSL has continuously marketed and sold its product under the mark "570" from December 31, 1991 to the present, and "579" from 1995 to the present. Id. ¶¶ 7-8. CSL owns a Trademark Application in "570, " and owns, as of May 14, 2002, an incontestable Trademark Registration in "579." Id. ¶¶ 9-10.

The current dispute centers on Midsun's sale of two similar products that both serve the "same general function" as CSL's "570" and "579." Id. ¶¶ 14-15. Midsun markets and sells the first as "570" or "Midsun 570, " and the other as "579" or "Sliprocoat 579." Id. Both Midsun products compete directly with CSL's versions of "570" and "579, " selling "to the same customers and within the same channel[s] of trade." Id. ¶¶ 14-15. At the core of its Complaint, CSL alleges that the use of these marks is "likely to cause confusion, mistake or deception as to the source or origin of [Midsun's] products among purchasers." Id. ¶ 17.

Use of the marks is without CSL's authorization or permission. Id. ¶¶ 14-15. Nevertheless, Midsun currently seeks registration of its "570" and "Midsun 570" marks with the USPTO, filing trademark applications on October 19, 2012 and June 17, 2014, respectively. Id. ¶ 19. CSL filed a Trademark Opposition Proceeding with respect to Midsun's application for the "570" mark, and, as of the filing of the complaint on December 17, 2014, had an intent to file such an opposition proceeding with respect to the "Midsun 570" mark as soon as it would be permitted. Id. ¶ 20.

Midsun is well aware that these marks are CSL's property, an indisputable fact given that Midsun was an authorized distributor of CSL's "570" and "579" products from 1995 until 1999, when CSL terminated the relationship. Id. ¶¶ 12-13. Midsun was notified in writing by CSL of CSL's trademark rights in the two marks, and knows that it did not have the right to continue use of the marks after termination of the distributorship relationship. Id. ¶ 23. In fact, Midsun's actions "have been malicious, deliberate, willful, intentional and in bad faith, with full knowledge and conscious disregard of CSL's rights." Id.

In light of the above, CSL brings seven causes of action against Midsun: two claims of unfair competition under Section 1125(a) of the Lanham Act (Count I as to "570" and Count VI as to "579"); two claims of violations of CUTPA (Count II as to "570" and Count VII as to "579"); two claims for refusal of Midsun's trademark registration applications under Section 1119 of the Lanham Act (Count III as to Defendant's proposed "570" mark and Count IV as to Defendant's proposed "Midsun 570" mark); and one claim (Count V) for trademark infringement under Section 1114 of the Lanham Act (with respect to "579").

B. Facts Defendant Asks The Court to Judicially Notice

Plaintiff's twelve-page complaint-six pages of which simply list out Plaintiff's causes of action and requested relief-omits nearly all of the details of the extensive history of CSL and Midsun's relationship, both as business partners and, subsequently, as foes in a bitter and lengthy trademark conflict. Midsun views this documented history as integral to an understanding of this dispute, and, moreover, that it affirmatively demonstrates that Plaintiff's claims are either untimely, precluded, or both. Midsun therefore asks the Court to take judicial notice and consider documents comprising the record in two USPTO trademark dispute actions between the parties. Specifically, Midsun submits documents from the record in those proceedings that establish the following:

• On January 3, 2000, Midsun filed an application with the USPTO for trademark registration of "MIDSUN 570." Doc. 10-1 Ex.A.
• On March 19, 2001, Midsun filed a "Statement of Use Under 37 CFR 2.88" with the USPTO with respect to "MIDSUN 570." Id. Ex. B.
• On November 13, 2001, the USPTO issued to Midsun trademark Registration No. 2, 508, 019 as to "MIDSUN 570." Id. Ex. C.
• On December 9, 2002, CSL filed with the USPTO a Petition to Cancel the "MIDSUN 570" trademark. Id. Ex. D.
• On June 15, 2005, CSL withdrew its Petition to Cancel the "MIDSUN 570" trademark. Id. Ex. E.
• On June 28, 2005, the USPTO's Trademark Trial and Appeal Board ("TTAB") dismissed CSL's Petition to Cancel the "MIDSUN 570" trademark with prejudice. Id. Ex. F.
• On July 8, 2008, the "MIDSUN 570" trademark was cancelled. Id. Ex. G.[1]
• In the trademark opposition proceeding as to "570" referenced in Plaintiff's complaint, CSL's President and CEO, Faisal Huda, submitted a sworn affidavit in support of CSL's motion for summary judgment. Id. Ex. H.
• On June 14, 2006, in a Notice of Abandonment, the USPTO declared that CSL's "570" application was abandoned on May 17, 2006. Id. Ex. I.
• On June 17, 2014, Midsun filed a trademark application with respect to "MIDSUN 570." Id. Ex. J.
• On January 6, 2015, the mark "MIDSUN 570" was published for opposition. Id. Ex. K.
• On March 12, 2015, Midsun filed a motion seeking the dismissal of CSL's claims in the opposition proceeding CSL brought with the USPTO as ...

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