United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
ROBERT BLAKEY, UNITED STATES DISTRICT JUDGE.
Impact Networking, LLC has sued Defendant Impact Technology
Solutions, Inc., alleging, among other things, that
Defendant's logo infringes Plaintiff's trademarks.
Along with its complaint, Plaintiff filed a motion for
preliminary injunction, seeking to bar Defendant from using
the allegedly infringing logo. This Court held an evidentiary
hearing on October 4 and 19, 2017, and the parties then filed
post-hearing briefs, along with proposed findings and
conclusions. This opinion constitutes the Court's
findings of fact and conclusions of law pursuant to Federal
Rule of Civil Procedure 52(a)(2).
Background and Procedural History
Impact Networking, an Illinois company with offices in
Illinois and Indiana, was formed in 1999 to sell and service
office equipment; the business as initially formed
“entailed printers and copiers and managed IT support,
which is helping people with their IT infrastructure.”
Tr. of Proceedings of 10/4/17 , at 12-13. The company
also offered desktop PC support (including project
management, office automation, desktop apps, and graphic
imaging), as well as internet support (including
connectivity, email, and website support). Id. at
connection with its business, Plaintiff registered two
service marks. The first, Reg. No. 2, 425, 077, issued June
30, 2001, and appears as follows:
Plaintiffs Exhibit 2. The registration indicates two uses:
for Distributorship in the Field of Office Equipment and
Supplies, in Class 35 (with a first use date of 8-0-1999),
and for “Maintenance and Repair of Office Machinery, in
Class 37” (with a first use date of
8-0-1999). Id. The second mark, Reg. No. 2,
428, 340, issued February 13, 2001, covers the company's
logo and looks like this:
Plaintiffs Exhibit 3. This registration similarly indicates
two uses: for “Maintenance and Repair of Office
Machinery, in Class 37” (with a first use date of
9-0-1999), and for “Distributorships in the Field of
Office Equipment and Supplies, in Class 39” (with a
first use date of 9-0-1999). Id.
current logo (the unregistered mark) looks like this:
Impact Technology Solutions, an Indiana company located in
Valparaiso, Indiana, was formed in December 2011. Tr. of
Proceedings of 10/19/17 , at 157. Since its inception,
Defendant has operated as a managed service provider for
small businesses; it provides managed IT services, desktop
support, service support, backup and disaster recovery,
email, cloud services, and virtualization. Id. at
158-59. The company has one office, in Valparaiso, Indiana,
and six employees (including the three founding partners).
Id. at 160. The company has about 75 customers (the
vast majority of which are in Northwest Indiana) and turns a
small profit (about $5, 000) each year. Id. Its logo
looks like this:
14, 2017, Plaintiff sued Defendant, alleging trademark
infringement in violation of 15 U.S.C. § 1114; unfair
competition in violation of 15 U.S.C. § 1125 and under
common law; violation of the Illinois Uniform Deceptive Trade
Practices Act; and violation of the Illinois Consumer Fraud
and Deceptive Business Practices Act. See .
Plaintiff filed a motion for preliminary injunction  on
July 20, 2017. In response to the complaint, Defendant filed
a counterclaim , seeking cancellation of Plaintiff's
marks and a declaratory judgment that Plaintiff has abandoned
its rights in the “Impact Networking” mark.
Court held an initial hearing in the case on July 27, 2017,
and, by agreement, set the matter for an evidentiary hearing
on the preliminary injunction motion on August 31, 2017.
. Thereafter, the parties requested limited expedited
discovery, which the Court allowed, and the evidentiary
hearing was reset for October 4, 2017. . At the hearing,
which was continued by agreement to October 19, 2017, both
sides presented live witness testimony and documentary
evidence, as well as arguments. [50, 52].
first presented Dan Meyer, Impact Networking's president
and founding partner, who testified that he and Frank Cucco
formed the company in the fall of 1999.  at 12. At that
time, the company's business purpose was “office
equipment, which entailed printers and copiers and managed IT
support, which is helping people with their IT
infrastructure.” Id. at 13. From its
inception, the company offered desktop PC support, including
project management, office automation, desktop applications,
graphic imaging and internet support. Id. at 14.
Meyer testified that his company has been using and offering
the same services continuously since its inception.
Id. at 15. Meyer testified that the company has
offered the services it offers today-namely, backup and
disaster recovery service, cloud solutions, network
monitoring, virtualization, spam protection, server support,
and network security-continuously as they became available
and by at least 2011. Id. at 24-26. Meyer conceded,
however, that none of these services are listed in the
company's trademark registrations. Id. at 48-49.
testified that Plaintiff operates primarily in Illinois,
Indiana, Wisconsin, and California-though it began operating
in California only a week prior to the hearing. Id.
at 28. It has operated in northwest Indiana and the
Chicagoland area since late 1999. Id. Plaintiff has
two offices in Indiana: one in Indianapolis, opened in 2008,
and one in Hammond, opened in January 2017. Id.
testified that Plaintiff advertises through radio and TV,
billboards and vehicles, and at sporting venues (including
major league teams' venues, such as Chicago Blackhawks
games at the United Center, Chicago Cubs games at Wrigley
Field, and Milwaukee Brewer games at Miller Park, and minor
league teams' venues, including the Chicago Wolves, the
Indianapolis Indians, the Kenosha Kingfish and the Madison
Mallards). Plaintiff distributes and mails literature, cold
calls prospective clients, hosts PowerPoint presentations and
“lunch-and-learns, ” and markets through social
media including LinkedIn, Facebook, Instagram, Twitter and
Pinterest. Id. at 29, 30-31, 33. Plaintiff owns an
office building in Lake Forest, Illinois, with signage
visible from the expressway, and it recently reached a deal
for signage and naming rights for the new home of the Chicago
Dogs (an independent baseball team), which is being built now
in Rosemont, Illinois. Id. at 34. Plaintiff targets
signage on buildings near busy expressways to build brand and
name recognition. Id. at 36. Meyer testified that
Plaintiff puts its name on “just about everything from
cell phone covers to shirts to you name it.”
Id. at 29.
had total revenues of over $58 million in 2016. Id.
at 59. In 2012, Plaintiff spent $580, 000 on advertising; in
2016, it spent $1.76 million; and in the first half of 2017
it spent $1.2 million. Id. at 39. Meyer testified
that Plaintiff employs approximately 180 people just in sales
and marketing, id. at 29, each of whom has a
“minimum target” of 500 telemarketing calls and
300 cold calls per month. Id. at 31-32. Meyer
testified that Plaintiff's sales force targets
“C-level employees” at target companies-that is,
CEO, CFO, and other high-ranking officers-because it wants
buy-in and authorization at that level. Id. at 57.
Meyer testified that the process of securing a customer takes
time and involves several meetings, an assessment, and the
execution of a written agreement. Id. at 57. With
this process, Plaintiff's employees “would make
sure the customer knows who [they] are.” Id.
at 57-58. Meyer testified that the contracts Plaintiff
ultimately executes with its customers are mostly long term
(five years); although the company has some contracts that