Denali Real Estate v. Denali Custom Builders
302 Neb. 984
| Neb. | 2019Background
- Denali Real Estate, LLC (DRE) registered the trade names “Denali Construction” and “Denali Homes” in Nebraska in Sept. 2015 and built/sold homes in eastern Nebraska.
- Denali Custom Builders, Inc. (DCB) incorporated Feb. 29, 2016 and built homes in Lancaster County; DCB commonly used the name “Denali Custom Builders” (omitting “Inc.”) on signs, website, and advertising.
- DRE sued DCB (Oct. 2016) for trade name infringement (Neb. Rev. Stat. § 87-217), deceptive trade practices (Uniform Deceptive Trade Practices Act), and tortious interference with business relationships, seeking injunctive relief, damages, and attorney fees.
- Trial produced evidence of actual confusion (misdirected bills/orders, supplier and retail confusion, a prospective buyer’s uncertainty) and similarities in fonts/colors/design between parties’ materials.
- The district court found for DRE on trade name misuse and deceptive trade practices, enjoined DCB from using “Denali,” awarded $1,000 statutory damages and $10,561.45 in attorney fees, but the court’s finding on tortious interference was unsupported as to breach/termination.
- DCB appealed, challenging pretrial dismissals/judgment-on-pleadings rulings, directed verdict denial, evidentiary rulings, damages/fees, and the scope of the injunction.
Issues
| Issue | Plaintiff's Argument (DRE) | Defendant's Argument (DCB) | Held |
|---|---|---|---|
| Pretrial motions (motion to dismiss; judgment on pleadings) | Motions were properly denied; the complaint stated claims; pleadings fairly encompassed the facts tried | Complaint fails to state a claim; DCB was using only its true corporate name so cannot be liable | Denial of motion to dismiss is moot after full trial; judgment-on-pleadings challenge lacked merit because issues tried and pleadings deemed to conform to evidence under rule §6-1115(b) |
| Trade name infringement (use/likelihood of confusion) | DRE: registered “Denali Construction” and “Denali Homes”; DCB’s use of “Denali Custom Builders” caused actual confusion | DCB: using its legal corporate name (Denali Custom Builders, Inc.) so not using a trade name or infringing | Held for DRE: DCB used “Denali Custom Builders” in trade; DRE’s registered names entitled to protection; evidence showed actual confusion — infringement proven |
| Deceptive trade practices (UDTPA) | DRE: DCB’s similar trade dress, use of “Denali,” and resulting confusion violated §87-302 | DCB: no deceptive conduct; was using its corporate name; injunction and remedies overbroad | Held for DRE: DCB’s use caused likelihood of confusion re source/affiliation and used similar image/trade dress; relief permitted under §87-303(a) |
| Tortious interference with business relationships | DRE: DCB’s use of “Denali” interfered with supplier and customer relations | DCB: confusion did not cause breach or termination of any relationship or expectancy | Held for DCB on this claim: DRE failed to prove that any relationship or expectancy was breached or terminated due to DCB’s conduct |
Key Cases Cited
- White v. Board of Regents, 260 Neb. 26 (2000) (adopted Restatement definition of "use" of a trade name)
- Prime Home Care v. Pathways to Compassion, 283 Neb. 77 (2012) (trade name infringement burden and likelihood-of-confusion framework)
- Nebraska Irrigation, Inc. v. Koch, 246 Neb. 856 (1994) (discussion of descriptiveness/generic terms and protection limits)
- Dahms v. Jacobs, 201 Neb. 745 (1978) (no relief where plaintiff failed to show actual or probable confusion)