United States District Court, N.D. Illinois, Eastern Division
OPINION AND ORDER
H. Lefkow U.S. District Judge.
Cup Operating Corporation filed suit against Lollicup USA,
Inc., alleging trademark infringement and unfair competition
under the Lanham Act, 15 U.S.C. §§ 1125(a) and
1114; unfair competition under both the Illinois Uniform
Deceptive Trade Practices Act, 815Ill.Comp.Stat. 510, and the
Illinois Consumer Fraud and Deceptive Business Practices Act,
815Ill.Comp.Stat. 505; and breach of contract under Illinois
common law. (Dkt. 30 at 1.) In response, Lollicup filed a
number of counterclaims and affirmative defenses. (Dkt. 33 at
12-21, 40-51.) Solo Cup now moves to dismiss several of the
counterclaims and defenses. For the reasons stated below,
Solo Cup's motion is granted.
Cup has a registered product configuration mark, 
Registration No. 3, 284, 076, for its "Traveler"
coffee-cup lid, pictured below.
is the subject of design and utility patents that expired in
2001 and 2003, respectively. These two patents were disclosed
to the Patent and Trademark Office (PTO) during Solo
Cup's trademark registration application process.
manufactures, advertises, and sells coffee cup lids under the
brand name "Karat." Solo Cup alleges that
Lollicup's "Karat" lids infringe its product
configuration mark. In response to Solo Cup's complaint,
Lollicup filed numerous counterclaims and affirmative
defenses. Solo Cup moves to dismiss and strike some of those
claims and defenses, including Lollicup's claims that (1)
Solo Cup fraudulently procured the trademark registration for
the "Traveler" lid configuration in violation of 15
U.S.C. § 1120, rendering it subject to cancellation
under 15 U.S.C. §§ 1064 and/or 1119 (counterclaims
II, V, and VI and affirmative defenses 3 and 9), (2) Solo
Cup's use of its product configuration mark on the
"Traveler" lid constitutes false advertising in
violation of 15 U.S.C. § 1125(a) (counterclaim VII), and
(3) the product configuration trademark for the
"Traveler" lid is invalid and unenforceable due to
either unconstitutionality or preemption (counterclaims III
and IV and affirmative defenses 4 and 5).
legal standard applied to a motion to dismiss a counterclaim
or strike an affirmative defense is the same as the standard
applied in a 12(b)(6) motion to dismiss for failure to state
a claim. See Intercon Sols., Inc. v. Basel Action
Network, 969 F.Supp.2d 1026, 1067 (N.D. 111. 2013),
affd, 791 F.3d 729 (7th Cir. 2015); Safe Bed
Techs. Co. v. KCI USA, Inc., No. 02 C 0097, 2003 WL
21183948, at *2 (N.D. 111. May 20, 2003). To survive such a
motion, the non-fraud counterclaims and affirmative defenses
must "contain sufficient factual matter, accepted as
true, to 'state a claim to relief that is plausible on
its face."' Ashcroft v. Iqbal, 556 U.S.
662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting
BellAtl. Corp. v. Twombly, 550 U.S. 544, 570, 127
S.Ct. 1955, 167 L.Ed.2d 929 (2007)). Lollicup's fraud
allegations must be stated with particularity in accordance
with Federal Rule of Civil Procedure 9(b). While factual
allegations must be accepted as true, legal conclusions will
not be considered. See Iqbal, 556 U.S. at 678.
Fraudulent Procurement (Counterclaims II, V,
and VI and Affirmative Defenses 3
procurement of a trademark registration occurs where the
applicant either "withhold[s] from the Patent and
Trademark Office . . . material information or fact which, if
disclosed to the Office, would have resulted in the
disallowance of the registration sought or to be maintained,
" Northwestern Corp. v. Gabriel Mfg. Co., No.
95 C 2004, 1996 WL 732519, at *16 (N.D. 111. Dec. 18, 1996)
(quotingFirstInt'l Servs. Corp. v. Chuckles, Inc.,
5 U.S.P.Q.2d 1628 (T.T.A.B. 1987)), or makes "a
deliberate attempt to mislead the PTO into registering [the]
mark by presenting materially false and misleading
information to the PTO when . . . seeking the trademark
registration." Specialized Seating, Inc. v.
Greenwich Indus., L.P., 472 F.Supp.2d 999, 1016 (N.D.
111. 2007) (citing Money Store v. Harriscorp Finance,
Inc., 689 F.2d 666, 670 (7th Cir. 1982); Zip Dee,
Inc. v. Dometic Corp., 900 F.Supp. 1004, 1009 (N.D. 111.
alleges that Solo Cup fraudulently procured its product
configuration trademark registration by misrepresenting to or
misleading the trademark examiner about whether the mark was
functional. Lollicup argues that, despite Solo Cup's
disclosure to the PTO of the expired patents describing that
mark, Solo Cup's written and oral statements made during
the trademark application process regarding non-functionality
constitute fraud. (See Dkt. 33 at 31-35; Dkt. 40-1
general terms, a product feature is functional, and cannot
serve as a trademark, if it is essential to the use or
purpose of the article or if it affects the cost or quality
of the article." Traffix Devices v. Mktg.
Displays,532 U.S. 23, 32, 121 S.Ct. 1255, 149 L.Ed.2d
164 (2001) (internal quotation marks omitted) (citations
omitted). The threshold inquiry in the Seventh Circuit is
"whether the feature for which trademark protection is
sought is something that other producers of the product in
question would have to have as part of the product in order
to be able to compete effectively in the market."
W.T. Rogers Co. v. Keene,778 F.2d 334, 346 (7th
Cir. 1985). The existence of a utility patent that
encompasses the ...