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Loggerhead Tools, LLC v. Sears Holdings Corp.

United States District Court, N.D. Illinois, Eastern Division

September 20, 2016

LOGGERHEAD TOOLS, LLC, Plaintiff,
v.
SEARS HOLDINGS CORPORATION and APEX TOOL GROUP, LLC, Defendants.

          MEMORANDUM OPINION AND ORDER

          JOHN W. DARRAH, United States District Court Judge

         Plaintiff, LoggerHead Tools, LLC, filed a Second Amended Complaint (“SAC”) against Defendants Sears Holdings Corporation (“Sears”) and Apex Tool Group, LLC, alleging, inter alia, claims based on Sears' use of internet trademarks: trademark infringement pursuant to the Lanham Act, Count V; false designation of origin pursuant to the Lanham Act, Count VI; trademark infringement and unfair competition pursuant to the Illinois Consumer Fraud and Deceptive Business Practices Act (“ICFA”), Count VIII; trademark infringement and unfair competition pursuant to the Uniform Deceptive Trade Practices Act (“UDTPA”), Count IX; Illinois common-law trademark infringement, Count X; Illinois common-law unfair competition, Count XIV; and trademark dilution pursuant to the Lanham Act, Count XVII. Sears filed a Motion for Summary Judgment [258]. For the reasons set forth more fully below, Sears' Motion for Summary Judgment [258] is granted.

         LOCAL RULE 56.1

         Local Rule 56.1(a)(3) requires the moving party to provide “a statement of material facts as to which the party contends there is no genuine issue for trial.” Ammons v. Aramark Uniform Servs., 368 F.3d 809, 817 (7th Cir. 2004). Local Rule 56.1(b)(3) requires the nonmoving party to admit or deny every factual statement proffered by the moving party and to concisely designate any material facts that establish a genuine dispute for trial. See Schrott v. Bristol-Myers Squibb Co., 403 F.3d 940, 944 (7th Cir. 2005). A nonmovant's “mere disagreement with the movant's asserted facts is inadequate if made without reference to specific supporting material.” Smith v. Lamz, 321 F.3d 680, 683 (7th Cir. 2003). In the case of any disagreement, the nonmoving party must reference affidavits, parts of the record, and other materials that support his stance. Local Rule 56.1(b)(3)(B). To the extent that a response to a statement of material fact provides only extraneous or argumentative information, this response will not constitute a proper denial of the fact, and the fact is admitted. See Graziano v. Vill. of Oak Park, 401 F.Supp.2d 918, 936 (N.D. Ill. 2005). Similarly, to the extent that a statement of fact contains a legal conclusion or otherwise unsupported statement, including a fact that relies upon inadmissible hearsay, such a fact is disregarded. Eisenstadt v. Centel Corp., 113 F.3d 738, 742 (7th Cir. 1997). Pursuant to Local Rule 56.1(b)(3)(C), the nonmovant may submit additional statements of material facts that “require the denial of summary judgment.”

         BACKGROUND

         Plaintiff is an Illinois limited-liability company with its principal place of business in Illinois. (DSOF ¶ 1.) Sears is a Delaware corporation with its principal place of business in Illinois. (Id. ¶ 2.) Sears began retailing LoggerHead's Bionic Wrench in 2009. (Id. ¶ 4.) On July 14, 2009, Dan Brown, the President of LoggerHead, signed a Universal Terms and Conditions Agreement (“UTC”) with Sears. (Id. ¶ 8.) The UTC states:

Seller [LoggerHead] authorizes Company [Sears] and each Authorized Reseller with respect to Company-Branded Merchandise and Company-Branded Outlet to directly and [i]ndirectly sell Merchandise through all promotional, advertising, distribution channels, and other methods of sale anywhere in the world including via telephone, print, television, radio, and the worldwide web (“Distribution Channels”). Seller grants to Company and each Authorized Reseller (with respect to Company-Branded Merchandise) and Company-Branded Outlet a nonexclusive, nontransferable, royalty free license to use, with the right to sublicense, trademarks, service marks, trade names, trade dress, copyrights and rights of publicity associated with Merchandise owned or licensed by Seller for the limited purpose of Company, and each Authorized Reseller (with respect to Company-Branded Merchandise) and Company-Branded Outlet, marketing promoting, or selling Merchandise through any Distribution Channel.

(Id. ¶ 9.)

         LEGAL STANDARD

         Summary judgment is appropriate when “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56. Courts deciding summary judgment motions must view facts “in the light most favorable to the nonmoving party only if there is a ‘genuine' dispute as to those facts.” Scott v. Harris, 550 U.S. 372, 380 (2007). A genuine dispute as to any material fact exists if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The moving party has the initial burden of establishing that there is no genuine dispute as to any material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party meets this burden, “[t]he nonmoving party must point to specific facts showing that there is a genuine issue for trial.” Stephens v. Erickson, 569 F.3d 779, 786 (7th Cir. 2009). Factual disputes do “not preclude summary judgment when the dispute does not involve a material fact.” Burton v. Downey, 805 F.3d 776, 783 (7th Cir. 2015). The evidence must be such “that a reasonable jury could return a verdict for the nonmoving party.” Pugh v. City of Attica, Ind., 259 F.3d 619, 625 (7th Cir. 2001) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)).

         ANALYSIS

         Defendant argues that all of Plaintiff's allegations are based on the use of internet keyword advertisements. Plaintiff stipulates to the dismissal of its trademark infringement claim under the Lanham Act, Count V; false designation of origin claim, Count VI; trademark infringement claim under Illinois common law, Count X; and trademark dilution claim, Count XVII. Plaintiff, however, argues that its remaining claims under the ICFA, Count VIII; UDTPA, Count IX; and Illinois common-law unfair competition, Count XIV, are not only based in its internet trademark allegations but also based in allegations directed to counts that are not the subject of this Motion. Specifically, Plaintiff argues that these remaining claims were also based on allegations directed to Plaintiff's claims for product design trademark infringement, Count XV; packaging trade dress infringement, Count XVI; false advertising, Count VII; Illinois common-law unfair competition, Count XIV; and fraud, Count XI.

         Sears argues that Plaintiff's remaining claims fail to reference allegations directed to product design infringement, packaging trade dress infringement, Illinois common-law unfair competition, and fraud. And although Sears concedes that these remaining claims sufficiently referenced Plaintiff's false advertising allegations, Sears argues that Plaintiff's remaining claims should nevertheless be dismissed because, as argued in a different motion for summary judgment, Plaintiff's false advertising claims are meritless. This Memorandum Opinion and Order will address the Counts to the extent that they are based on internet trademark claims. To the extent that the Counts are based on issues that are resolved in other summary judgment rulings, those Memorandum Opinion and Orders will control.

         Counts VIII & IX

         In Counts VIII and IX, Plaintiff alleges that Sears has violated the ICFA and the UDTPA respectively. Plaintiff argues that Sears failed to address these claims because they are based on internet trademark allegations and based on allegations directed to product design infringement, packaging trade dress infringement, false advertising, Illinois common-law unfair competition, and fraud. Sears argues that the allegations contained within ...


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