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THOMAS & BETTS CORP. v. PANDUIT CORP.

May 18, 1999

THOMAS & BETTS CORPORATION AND THOMAS & BETTS HOLDINGS, INC., PLAINTIFFS,
v.
PANDUIT CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Morton Denlow, United States Magistrate Judge.

MEMORANDUM OPINION AND ORDER

The saga continues. After several trips between this Court and the Seventh Circuit Court of Appeals, the case is back. The Seventh Circuit previously reversed this Court's grant of summary judgment to Panduit on Count II and remanded for further proceedings. Panduit Corporation (hereinafter "Panduit") now brings a motion to dismiss Count II of the complaint filed by Plaintiffs Thomas & Betts Corporation and Thomas & Betts Holdings, Inc. (hereinafter collectively "T & B"). Panduit contends the Court no longer has jurisdiction over Count II. The Court disagrees. For the reasons set forth below, Panduit's motion to dismiss Count II is denied.

I. BACKGROUND FACTS

T & B and Panduit are the nation's largest suppliers of cable ties. Cable ties are nylon plastic straps used to tie together cables or wires. T & B obtained a utility patent on the two-piece cable tie in 1965, which expired in 1982. T & B also obtained a design patent on the cable tie in 1966, which expired in 1980. In late 1993, Panduit began to produce a cable tie similar to that of T & B, sold under the trademark "BARB-TY." Panduit's cable tie is substantially similar in appearance to T & B's cable tie.

T & B brought this action in five counts against Panduit. Count I alleges that Panduit's metal barb oval head shaped cable tie infringes on the trade dress of T & B's cable tie in violation of Section 43(a) of the Lanham Act. 15 U.S.C. § 1125(a). Count II alleges that Panduit's registration and use of the trademark BARB-TY constitutes unfair competition under the Lanham Act, 15 U.S.C. § 1125(a)(1)(A), and seeks cancellation of Panduit's trademark registration of the term BARB-TY. T & B also alleged that Panduit's conduct violates the common law of unfair competition in Count III; the Illinois Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505/2, and the Uniform Deceptive Trade Practices Act, 815 ILCS 510/1, in Count IV; and the Illinois Anti-Dilution Act, 765 ILCS 1035/15, in Count V.

T & B previously brought a motion for a preliminary injunction which was granted by the trial court in Thomas & Betts Corp. v. Panduit Corp., No. 94 C 2656, 1994 WL 714619 (N.D.Ill.Dec.19, 1994), and later reversed by the Seventh Circuit, Thomas & Betts Corp. v. Panduit Corp., 65 F.3d 654 (7th Cir. 1995). The case was then transferred to this Court which granted summary judgment against T & B on Counts I, III, IV, and V. Thomas & Betts Corp. v. Panduit Corp., 935 F. Supp. 1399 (N.D.Ill. 1996) ("T & B I"). This Court subsequently granted summary judgment against T & B with regard to Count II. Thomas & Betts Corp. v. Panduit Corp., 940 F. Supp. 1337 (N.D.Ill. 1996) ("T & B II"). On appeal, the Seventh Circuit reversed the grant of summary judgment on Counts I and II. Thomas & Betts Corp. v. Panduit Corp., 138 F.3d 277 (7th Cir. 1998) ("T & B III"). No appeal was taken regarding Counts III through V and they are no longer part of the case.

II. ANALYSIS OF COUNT II

Panduit now brings a motion to dismiss Count II for lack of subject matter jurisdiction. Fed.R.Civ.P. 12(b)(1). A review of the history of Count II is a necessary background.

A. Count II of the Complaint.

Count II is captioned "Unfair Competition Under 15 U.S.C. § 1125(a) and Withdrawal Of Application For Registration (or Cancellation of Registration Under 15 U.S.C. § 1064(3))" and consists of several components. In Count II, T & B alleges the term "barb tie" has become associated with Thomas & Betts' products, "although this term is also a generic expression for identifying two-piece self-locking cable ties having a metal locking device or a barb." (Compl. ¶ 26.) According to T & B, the term BARB-TY is virtually indistinguishable from and phonetically identical to the "barb tie" designation which is uniquely associated with Thomas & Betts' cable ties. (Compl. ¶ 27.) As a result, T & B believes Panduit is using the BARB-TY trademark to trade on T & B's reputation. (Compl. ¶ 29.) In sum, T & B asserts all of the above allegations demonstrate a violation of 15 U.S.C. § 1125(a)(1)(A) because Panduit's use of the term BARB-TY as a trademark for its cable ties constitutes a false designation of origin, "which is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of Panduit with Thomas & Betts or as to the origin, sponsorship or approval of Panduit's two-piece self-locking cable ties, or the commercial goods or activities of others." (Compl. ¶ 28.)

In Count II, T & B also claims that, because of "barb tie's" association with T & B's products and generic quality, Panduit obtained its registration of the trademark BARB-TY fraudulently and did not have the right to register the mark BARB-TY. (Compl. ¶¶ 32-33.) To support this allegation, T & B reviews Panduit's application history before the U.S. Patent and Trademark Office ("PTO") for the BARB-TY mark. Panduit's Application Serial No. 74/331,294, covering the mark was allowed on July 13, 1993. (Comp. ¶ 30.) T & B asserts Panduit failed to advise the PTO of the significance of the term "barb tie" while making its application. (Comp. ¶ 31.) This is in direct contravention to 15 U.S.C. § 1064(3) according to T & B. (Comp. ¶ 33.)

T & B claims damages from the registration of the BARB-TY mark arising out of a misrepresentation as to the source of the cable tie or in connection with the way the mark is used. (Comp. ¶ 35.) In addition, as part of its prayer for relief, T & B seeks an order pursuant to 15 U.S.C. § 1119 directing the PTO Commissioner to cancel the BARB-TY registration. (Comp. ¶ B, p. 17.)

B. T & B I, 935 F. Supp. 1399 (N.D.Ill. 1996).

Although there were earlier opinions in this case, Count II was first addressed on the merits in this Court's August 15, 1996 decision in connection with Panduit's motion for summary judgment. T & B I, 935 F. Supp. 1399, 1418 (N.D.Ill. 1996). The Court denied Panduit's motion for summary judgment on Count II because the record was ...


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