Innovation Ventures, LLC v. NVE, Inc.
90 F. Supp. 3d 703
E.D. Mich.2015Background
- Plaintiff Innovations Ventures (Living Essentials) owns common-law mark "5-Hour ENERGY" and sues NVE, Inc. for trademark infringement by its "Stacker 2® 6-Hour POWER" energy shot; NVE counterclaims for false advertising based on a "Legal Notice" sent by Plaintiff.
- Case remanded from the Sixth Circuit; the Sixth Circuit held the mark is suggestive and protectable and found triable issues on likelihood of confusion and whether the Legal Notice was misleading.
- Long discovery history: initial expert reports were served in 2009; after remand the parties submitted supplemental expert reports in 2014, producing dispute over which experts/reports are admissible.
- The court resolved numerous Daubert and in limine motions: excluded Plaintiff’s Original Sarel survey but admitted Plaintiff’s New Sarel report; admitted Marylander (Teflon) survey; limited several experts’ scope (Carpenter, Pirko); allowed NVE to assert unclean hands (subject to limits).
- The court excluded USPTO office-action evidence as more prejudicial than probative given the Sixth Circuit’s protectability ruling, excluded ephedra litigation and Occhifinto’s old criminal convictions, and narrowed admissibility of alleged instances of "actual confusion."
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of supplemental expert reports (Sarel, Jay) | Sarel and Jay reports qualify as "supplemental" under scheduling order | Reports untimely under Rule 26(e); Jay is a new expert, prejudicial | Magistrate order affirmed: New Sarel report admitted; Jay excluded as untimely new expert |
| Use of PTO proceedings (prior refusals) | Exclude PTO office actions as contrary to Sixth Circuit mandate that mark is protectable | PTO history probative of mark strength | Excluded under Rule 403 — PTO refusals more prejudicial and risk jury confusion given Sixth Circuit ruling |
| Unclean hands defense | Plaintiff: preclude because Defendant failed to timely disclose/support it | Defendant: timely supplemented and provided deposition/testimony and expert materials supporting defense | Denied — NVE may assert unclean hands except for fraud-in-procurement theory tied to Supplemental Register (not pled with Rule 9(b) specificity) |
| Admissibility of Original Sarel survey (Daubert) | Survey reliable and relevant to likelihood of confusion | Methodological flaws (population, control, leading questions) render it unreliable | Original Sarel report excluded (New Sarel may be used) |
Key Cases Cited
- Innovation Ventures, LLC v. N.V.E., Inc., 694 F.3d 723 (6th Cir. 2012) (appellate mandate: mark found suggestive/protectable; Legal Notice may be misleading)
- Innovation Ventures, LLC v. N2G Distrib., Inc., 763 F.3d 524 (6th Cir. 2014) (affirming admissibility and consideration of similar survey evidence in related litigation)
- Daubert v. Merrell Dow Pharm., 509 U.S. 579 (U.S. 1993) (trial court gatekeeping duty for expert testimony under Rule 702)
- Kumho Tire Co. v. Carmichael, 526 U.S. 137 (U.S. 1999) (Daubert principles apply to non-scientific expert testimony; district court discretion)
- Frisch’s Rests., Inc. v. Elby’s Big Boy of Steubenville, Inc., 670 F.2d 642 (6th Cir. 1982) (eight-factor likelihood-of-confusion framework)
- Precision Instrument Mfg. Co. v. Automotive Maintenance Mach. Co., 324 U.S. 806 (U.S. 1945) (unclean hands doctrine bars equitable relief for party guilty of inequitable conduct)
- Balance Dynamics Corp. v. Schmitt Indus., Inc., 204 F.3d 683 (6th Cir. 2000) (available Lanham Act remedies include defendant profits, plaintiff damages; disgorgement and lost profits principles)
- Allard Enters. v. Advanced Programming Res., Inc., 249 F.3d 564 (6th Cir. 2001) (common-law trademark rights arise from actual use and first use in geographic areas)