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Edsal Manufacturing Company, Inc v. Vault Brands

November 15, 2012

EDSAL MANUFACTURING COMPANY, INC., PLAINTIFF,
v.
VAULT BRANDS, INC., DEFENDANT.



The opinion of the court was delivered by: Judge Robert M. Dow, Jr.

MEMORANDUM OPINION AND ORDER

Plaintiff Edsal Manufacturing Company, Inc. filed its complaint against Defendant Vault Brands, Inc. alleging Trademark Infringement (Count I), False Designation of Origin (Count II), and Unfair Competition (Count III) under the Lanham Act, as well as violations of state laws that prohibit deceptive trade practices and unfair competition (Count IV). Prior to engaging in any court-supervised discovery, Defendant moved for summary judgment [17] on all counts. In lieu of requesting discovery pursuant to Federal Rule of Civil 56(d), Plaintiff responded to Defendant's summary judgment motion. The matter is now ready for disposition. For the reasons explained below, the Court grants Defendant's motion for summary judgment [17].*fn1

I. Background

A. Statements of Facts

The Court has taken the relevant facts primarily from the parties' Local Rule ("L.R.") 56.1 statements. Local Rule 56.1 requires that statements of facts contain allegations of material fact and that factual allegations be supported by admissible record evidence. See L.R. 56.1; Malec v. Sanford, 191 F.R.D. 581, 583-85 (N.D. Ill. 2000). It is the function of the Court, with or without a motion to strike, to review carefully statements of material facts and to eliminate from consideration any argument, conclusions, and assertions that are unsupported by the documented evidence of record offered in support of the statement. See, e.g., Sullivan v. Henry Smid Plumbing & Heating Co., Inc., 2006 WL 980740, at *2 n.2 (N.D. Ill. Apr. 10, 2006); Tibbetts v. RadioShack Corp., 2004 WL 2203418, at *16 (N.D. Ill. Sept. 29, 2004); Rosado v. Taylor, 324 F. Supp. 2d 917, 920 n.1 (N.D. Ind. 2004). The Court's scrutiny of material statements of facts applies equally to the party seeking summary judgment and the party opposing it.

Prior to setting forth the background facts in this case, one point is worth mentioning. Where a party offers a legal conclusion in a statement of fact, the Court will not consider that statement. Malec v. Sanford, 191 F.R.D. at 583. Throughout its statement of additional facts, Edsal continuously refers to the term "Vault" as its "trademark" or "mark." In its sur-reply, Edsal then chides Defendant Vault for failing "to properly respond to Edsal's Statement of Additional Facts" because Defendant denies several of Plaintiff's fact statements for the reason that "Vault denies that Edsal has a 'Vault' trademark." In the circumstances of this case, Edsal's assertion that it has a valid and protectable right in the term "vault" as a trademark is a legal conclusion, not a statement of fact. In fact, the primary dispute between the parties is whether Edsal can demonstrate that it has a valid and protectable right in the term "vault." Defendant was correct to deny any statement that it believed contained a legal conclusion. Any statements or responses from either party that contain legal conclusions or argument will not be considered by the Court in ruling on the summary judgment motion.

B.Facts

Plaintiff Edsal Manufacturing Company, Inc. ("Edsal"), an Illinois corporation, has its principal place of business in Chicago, Illinois. Edsal was founded in 1957 and has continuously sold a number of industrial products, including shelving, racking, and storage systems, to businesses. In its complaint, Edsal alleges that it has manufactured, offered for sale, and sold products under the "Vault" mark, including metal cabinets, since 1996. Edsal maintains that it markets one of its product lines as its "Vault" line of cabinets and that some of its customers commonly refer to this product line as the "Vault" product line.

Defendant Vault Brands, Inc. ("Vault"), a privately held Delaware corporation, has its principal place of business in Beaverton, Oregon. Founded in 2005, Vault designs and sells custom-built metal cabinets and offers its products for sale on its website at http://www.vaultgarage.com/. Vault affixes the VAULT mark to its custom-built metal cabinets. On May 30, 2006, Vault filed an application to register the VAULT mark for custom built-to-order metal cabinets with the United States Patent and Trademark Office ("USPTO"). On June 3, 2008, the USPTO granted registration of the VAULT mark to Vault with U.S. Registration Number 3,440,709 ('709 Reg.).

In 2011, Vault and Edsal became embroiled in a dispute over their respective uses of and rights to the VAULT trademark.*fn2 Edsal then commenced this lawsuit on December 29, 2011. Although Edsal alleges that it has marketed and sold metal cabinets under the "vault" mark since 1996, Edsal did not apply to register the term "vault" until fifteen years later when this dispute arose. On December 27, 2011, two days prior to filing this lawsuit, Edsal filed an application with the USPTO to register the term "vault" as a trademark for "metal storage cabinets not being furniture, and component parts therefor." As of March 16, 2012, Edsal's application was still pending.

Edsal's application and the specimens attached thereto use the term "vault" to identify its locking metal cabinets. In one specimen, Edsal uses "vault" and other descriptive terms, including "commercial," "industrial," "visual," "safety," "modular drawer," "welded bin," and "flush door," to describe functions or features of its metal cabinets. The term "vault" appears in the same font, size, and color as the terms used to describe Edsal's other cabinets. In the same specimen, Edsal claims, "From Commercial, to Industrial, to Flammable, to Vault -- Edsal can meet all your storage needs!" In the second specimen, Edsal lists the features of its "flush door and vault cabinets" and includes pictures of each. In this specimen, "vault" cabinets, which are locking cabinets, are distinguished from "flush door" cabinets.

A catalog of Edsal's industrial storage cabinets is available on Edsal's website. Defendant Vault does not dispute that Edsal's catalogues (print and online) and website display the word "vault" in connection with Edsal's vault cabinets or that these catalogs provide ordering information for vault-style cabinets. Excluding duplicate pages and pages that are not intended for public viewing, the term "vault" appears on fewer than 10 pages of Edsal's approximately 559-page website.*fn3 On a page that shows Edsal's various "Storage Cabinets," "vault" is one of many descriptive terms used to identify its cabinets. The term "vault" appears in the same font, size, and color as the descriptive terms in the other cabinets' labels. Edsal's online catalog also contains a page titled "Welded and Vault Cabinets" that also displays the term "vault." The "Vault Cabinets" page on Edsal's website lists the vault cabinets that Edsal sells and describes the vault cabinets' features or function: "Combine the heavy-duty construction of our popular all-welded cabinets with the security of a three-point door-latch system." The "Support" page on Edsal's website has a link to assembly instructions for Edsal's vault cabinets. The term "vault" appears at the top of this sheet of instructions. Edsal has similar instructions for most of its cabinets, including its "commercial," "safety," "industrial," "welded bin," and "extra heavy duty" cabinets. A list of Edsal's various cabinets appears as follows: "Mobile Storage Cabinets," "Safety Cabinets," "Cabinette," "Commercial and Industrial Cabinets," "Flush Door & Vault Cabinets," "Visual Cabinets," "Welded Bin Cabinets," "Extra Heavy Duty Cabinets," and "Modular Drawer Cabinets."

Looking at a page from a 1996 Edsal catalogue, customers are presented with the heading "New" "Vault Cabinets." In the 1996 catalogue, "Vault Cabinets" are described in an almost identical manner to the way that they are described on Edsal's website: as combining the "heavy duty construction of our popular all welded cabinets with the security of a 3 point door latch system." There is no dispute that Edsal's catalogues provide model numbers, description of products, and information necessary to place an order directly with Edsal. There also is no dispute that catalogues from 1998, 2001, and 2005 display much of the same information on "Vault Cabinets," in predominantly the same way.

According to Edsal's Vice President, the "Vault" product line is presented to customers and potential customers in two primary ways. In some situations, the sales representative brings the potential customer to Edsal's showroom, which displays physical cabinets. Edsal sales representatives then show the customer the vault-style cabinet, and identify the cabinet as part of Edsal's "Vault" product line, and also direct the customer to Edsal's catalogue, which lists each of the cabinet types, including the "Vault Cabinet." ...


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