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Bodum USA, Inc. v. A Top New Casting Inc.

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

June 6, 2018

BODUM USA, INC., Plaintiff,
v.
A TOP NEW CASTING INC., Defendant.

          ORDER ON DEFENDANT'S POST-TRIAL MOTIONS

          MATTHEW F. KENNELLY, UNITED STATES DISTRICT JUDGE.

         After a trial, a jury found in favor of plaintiff Bodum USA, Inc. and against defendant A Top New Casting Inc. on Bodum's claim of trade dress infringement under the Lanham Act. The jury also found that A Top's infringement was willful. It awarded Bodum $2 million, which it found to be A Top's profits gained from the trade dress infringement. A Top has moved for entry of judgment as a matter of law under Federal Rule of Civil Procedure 50(b) and for a new trial under Federal Rule of Civil Procedure 59(a). The Court denies both motions for the reasons stated below.

         1. Motion for judgment as a matter of law

         Entry of judgment as a matter of law under Federal Rule of Civil Procedure 50 is appropriate only if no rational jury could have found for the prevailing party. See, e.g., Venson v. Altamirano, 749 F.3d 641, 646 (7th Cir.2014). When reviewing a motion for judgment as a matter of law, the Court "must draw all reasonable inferences in favor of the nonmoving party, and it may not make credibility determinations or weigh the evidence." Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000).

         A Top's first contention is that Bodum abandoned its trade dress by engaging in what is sometimes called "naked" licensing. A party making such a contention faces a heavy burden. See Restatement (Third) of Unfair Competition § 33 cmt. c (Am. Law. Inst. 1995) ("Because a finding of inadequate control can result in a forfeiture of trademark rights, courts impose a heavy burden on the person asserting a lack of reasonable control by a licensor."); TMT N. Am., Inc. v. Magic Touch GmbH, 124 F.3d 876, 885 (7th Cir. 1997) (same). To carry this burden, A Top was required to establish that Bodum "allow[ed] others to use the mark without exercising reasonable control over the nature and quality of the goods, services, or business on which the mark is used by the licensee." Eva's Bridal Ltd. v. Halanick Enters., Inc., 639 F.3d 788, 789 (7th Cir. 2011).

         The evidence at trial, viewed in the light most favorable to Bodum as required, showed the following. First, Bodum's license agreement with the licensee in question contained quality control requirements, non-compliance with which entitled Bodum to terminate the license. Second, the product manufactured by the licensee was tested for quality at the time the license agreement was entered into. Third, Bodum's principal, Joergen Bodum, later visited the licensee's facility to assess its compliance. And fourth, Bodum sent its outside counsel to trade shows annually to inspect the licensed products and report back to the company. Contrary to A Top's argument, this case is nothing like Eva's Bridal, in which the trademark holder "did not retain any control-not via the license agreement, not via course of performance." Id. at 790-91. A reasonable jury could find that Bodum retained "reasonable control" over the nature and quality of the goods made and sold by the licensee.

         A Top's second contention is that Bodum failed to prove that its trade dress was non-functional, as required in order for it to be enforceable under the Lanham Act. The jury was instructed, without objection by A Top, that Bodum had to prove (among other things) that its trade dress was not functional. The jury was instructed, again without objection by A Top, to determine this question as follows:

         A trade dress is functional if it is necessary to the operation of the product as a whole. To determine this, you are to consider the following:

• Are there other designs that could perform the function equally well? (If so, this is evidence that the design is not functional.)
• Is there a patent that discloses the practical advantages of the design? (If so, this is strong evidence that the design is functional.)
• Does the design provide a practical advantage? (If so, this is evidence that the design is functional.)
• Has Bodum advertised or promoted the practical advantages of the design? (If so, this is evidence that the design is functional.)
• Does the design result from a comparatively simple, cheap, or superior method of manufacturing the product? (If so, this is evidence that the design is functional.)
To determine whether a product's trade dress is functional, you should consider everything that makes ...

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