Daimler AG v. A-Z Wheels LLC, 334 F. Supp. 3d 1087

Background

Daimler AG (Mercedes‑Benz) owns federal registrations for the mark MERCEDES‑BENZ and the Three‑Point Star and holds U.S. Design Patent No. D542,211 covering an ornamental wheel face.
Defendants (A‑Z Wheels LLC d/b/a USArim/Eurotech, Galaxy Wheels & Tires, Infobahn International, and Rasool, Ryan, and Joshua Moalemi) operated USArim.com and sold automotive wheels advertised using Mercedes‑Benz marks and wheel designs.
Daimler alleges trademark infringement and counterfeiting (use of identical MERCEDES‑BENZ and Three‑Point Star marks on competing wheels) and design‑patent infringement of the D211 patent; Daimler moved for partial summary judgment.
Defendants asserted nominative fair use and the first‑sale doctrine for trademarks, and design‑difference arguments against patent infringement; they also contended some corporate defendants were dissolved and pressed limits on individual liability for Rasool Moalemi.
The court examined website listings, purchased exemplar wheels (including center/end caps), compared accused wheels to the patent figures and prior art, and considered record evidence of Moalemi’s active role in listings and pricing.
The court granted Daimler’s motion in full: liability for trademark infringement and counterfeiting as to MERCEDES‑BENZ and the Three‑Point Star, design‑patent infringement of D542,211, potential personal liability for Rasool Moalemi based on active participation, and entity liability for pre‑dissolution acts.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Trademark infringement (MERCEDES‑BENZ)	Daimler: owns registrations; Defendants use identical mark on competing wheels causing consumer confusion	Defs: consumers are careful purchasers; nominative fair use (replica labeling) and descriptive online use	Grant — identical use on competing goods creates presumed confusion; nominative fair use inapplicable where mark is used to sell defendants’ own products without consistently labeling as replicas
Trademark infringement (Three‑Point Star)	Daimler: identical mark appears on center caps sold by Defendants; caps on purchased wheels are not genuine	Defs: first‑sale doctrine — resold genuine caps protect them	Grant — evidence shows caps are not genuine; first‑sale defense fails
Trademark counterfeiting	Daimler: registered marks used identically on goods — counterfeiting under Lanham Act	Defs: contested provenance and corporate form; no separate counterfeiting defense asserted	Grant — counterfeit definition met because marks are identical on infringing goods
Design patent infringement (D542,211)	Daimler: accused wheels are substantially similar to the patented ornamental front face when viewed by ordinary observer in light of prior art	Defs: pointed to several design differences and argued overlap with prior art should preclude infringement	Grant — ordinary‑observer test (Egyptian Goddess) finds substantial overall similarity; prior‑art comparison does not create distinguishing features sufficient to avoid infringement

Key Cases Cited

Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment burden allocation)
Anderson v. Liberty Lobby, 477 U.S. 242 (summary judgment; assessing genuine disputes of material fact)
Rearden LLC v. Rearden Commerce, Inc., 683 F.3d 1190 (9th Cir. 2012) (trademark infringement elements and Sleekcraft factors)
Brookfield Commc'ns, Inc. v. W. Coast Entm't Corp., 174 F.3d 1036 (9th Cir. 1999) (registration as prima facie evidence and counterfeiting presumption)
AMF Inc. v. Sleekcraft Boats, 599 F.2d 341 (9th Cir. 1979) (multi‑factor likelihood‑of‑confusion test)
Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665 (Fed. Cir. 2008) (ordinary‑observer test for design‑patent infringement)
Goodyear Tire & Rubber Co. v. Hercules Tire & Rubber Co., 162 F.3d 1113 (Fed. Cir. 1998) (design‑patent infringement standard)
Elmer v. ICC Fabricating, Inc., 67 F.3d 1571 (Fed. Cir. 1995) (design patent protects ornamental, nonfunctional aspects)