mark's distinctiveness, effectiveness, and value by damaging the positive associations attached to the trademark. See 3A R. CALLMANN, UNFAIR COMPETITION, TRADEMARKS & MONOPOLIES § 21.11, at 33-34 (4th ed. 1981); 2 J. MCCARTHY, MCCARTHY ON TRADEMARKS AND UNFAIR COMPETITION § 24.13, at 215 (2d ed. 1984). Dilution does not require a showing of likelihood of consumer confusion and is thus understood as providing greater protection for trademark owners. See Shire, Dilution Versus Deception -- Are State Antidilution Laws an Appropriate Alternative to the Law of Infringement?, 77 Trademark Rep. 273 (1987).
Abbott seeks protection against dilution of its trade dress under Massachusetts law in count II of its complaint. See MASS. GEN. L. ch. 110B, § 12. Nonetheless, NutraMax asserts that Illinois law governs the viability of Abbott's dilution claim. See 765 ILCS 1035/15. Because there exists a conflict between Illinois law and Massachusetts law on the anti-dilution claim, compare EZ Loader Boat Trailers, Inc. v. Cox Trailers, Inc., 746 F.2d 375, 380 (7th Cir. 1984) (commercial competitors cannot sue under the Illinois anti-dilution statute); Filter Dynamics Int'l v. Astron Battery, Inc., 19 Ill. App. 3d 299, 311 N.E.2d 386, 398-99 (1974) (same) with Pignons S.A. de Mecanique de Precision v. Polaroid, 657 F.2d 482 (1st Cir. 1980) (commercial competitors can sue under the Massachusetts anti-dilution statute), the court must first resolve the choice-of-law issue.
Illinois follows the "most significant contacts" approach of the RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 145 in resolving disputes over the choice of law in a tort action. Ingersoll v. Klein, 46 Ill. 2d 42, 262 N.E.2d 593 (1970). This approach requires the court to determine which state possesses the most significant relationship to the issues involved after evaluating the contacts the various states have with the litigation. Koutsoubos v. Casanave, 816 F. Supp. 472, 475 (N.D. Ill. 1993); see Palmer v. Beverly Enters., 823 F.2d 1105, 1107 (7th Cir. 1987); Lyons v. Turner Constr. Co., 195 Ill. App. 3d 36, 551 N.E.2d 1062, 1064-65, 141 Ill. Dec. 719 (1990). In tort actions, the relevant contacts include the location where the tortious act took place, the place of injury, and the domicile and place of business of the parties. Koutsoubos, 816 F. Supp. at 475. The most significant factor is the place of injury. Id.
Infringement of intellectual property rights sounds in tort. Habitat Wallpaper & Blinds v. K.T. Scott Ltd., 807 F. Supp. 470, 473 (N.D. Ill. 1992). The place of injury usually defines the locus of a cause of action for trade dress infringement and unfair business practices; and the damage to intellectual property rights is usually realized where the owner of the protected rights suffers the damage. Id. Abbott's principal place of business is in Illinois and will thus realize the dilution or misappropriation of its trade dress in Illinois. In addition, although NutraMax's Pediatric Electrolyte originates from Massachusetts, Abbott's claims are based in part on the sale of the Pediatric Electrolyte in this district. The division through which Abbott manufactures and sells its Pedialyte is in Ohio,
but Pedialyte is distributed nationally. Accordingly, Illinois has the most significant relationship to Abbott's claims and its unfair competition laws will apply.
The application of Illinois law dooms Abbott's dilution claim.
Trademark dilution is recognized in Illinois by the Illinois Anti-Dilution Act, 765 ILCS 1035/15. To succeed on a dilution claim under Illinois's statute, a plaintiff must demonstrate that its mark is distinctive and that the defendant's use of the same or similar mark dilutes that distinctiveness. Eveready Battery Co., Inc. v. Adolph Coors Co., 765 F. Supp. 440, 451 (N.D. Ill. 1991). The Act provides additional protection to trademark owners by preventing the disparagement or erosion of their marks through use by third parties on non-confusing, non-competing products. Id. (citing Ringling Bros.-Barnum & Bailey Combined Shows, Inc. v. Celozzi-Ettelson Chevrolet, Inc., 855 F.2d 480, 482 (7th Cir. 1988)). It is well settled, however, that commercial competitors cannot recover under Illinois's anti-dilution statute. EZ Loader, 746 F.2d at 380; Filter Dynamics, 311 N.E.2d at 398-99. Abbott's claim for dilution against NutraMax, a competitor, must therefore fail.
Count III is a claim for unlawful misappropriation of a valuable asset in violation of the common law. Illinois's common law doctrine of misappropriation has been generally limited to the misappropriation of valuable business information. See Nash v. CBS, Inc., 704 F. Supp. 823, 835 (N.D. Ill. 1989) (systematic appropriation of valuable stored information), aff'd, 899 F.2d 1537 (7th Cir. 1990); Board of Trade of the City of Chicago v. Dow Jones & Co., 98 Ill. 2d 109, 456 N.E.2d 84, 74 Ill. Dec. 582 (1983) (misappropriation of Dow Jones index and averages). Furthermore, an esteemed commentator in the field of intellectual property and unfair competition law has observed,
The misappropriation doctrine cannot be used in ordinary trademark infringement cases as shortcuts around the trademark law's standard of protection. That is, one cannot dispense with the carefully construed requirements for trademark protection by blithely claiming that defendant 'misappropriated' some symbol of plaintiff which may or may not be capable of trademark protection . . . .