ROCKWELL AUTOMATION, INC. v. RADWELL INTERNATIONAL, INC.
1:15-cv-05246
| D.N.J. | Nov 30, 2016Background
- Rockwell Automation (plaintiff) manufactures industrial automation products bearing twelve registered trademarks (Allen-Bradley, Rockwell Automation, etc.) and sells through authorized distributors.
- Radwell International (defendant) resells Rockwell-branded products via its website and eBay but is not an authorized Rockwell distributor; Rockwell alleges Radwell procured goods through a "fake" company and resells at lower prices.
- Rockwell alleges Radwell’s offerings are materially different or non-genuine (broken seals, lacking factory warranty/support, different post-manufacture quality control, missing software licenses/indemnities, etc.).
- Rockwell alleges numerous false or misleading statements in Radwell’s listings (claims of factory warranty, “new/unused/sealed,” manufacturer-origin statements, use of Rockwell logos, and implications of affiliation/sponsorship).
- Procedural posture: Rockwell filed suit asserting Lanham Act claims (trademark infringement, false advertising, false designation of origin, dilution), New Jersey statutory unfair competition, and common-law unfair competition. Radwell moved to dismiss under Rule 12(b)(6); the court granted the motion in part and denied it in part.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Trademark infringement under 15 U.S.C. § 1114 | Rockwell: marks are registered and Radwell’s use of marks on materially different goods creates likelihood of confusion and injures goodwill | Radwell: first-sale/exhaustion doctrine bars claim; plaintiff fails to plead material differences | Court: Denied motion. Rockwell pleaded protectable registered marks and sufficient facts (post-manufacture quality-control differences and other allegations) to plausibly show material differences; first-sale doctrine does not bar claim where material differences exist. |
| False advertising under 15 U.S.C. § 1125(a)(1)(B) | Rockwell: Radwell made literally false and misleading statements (warranty, new/sealed, manufacturer origin) that deceive consumers and cause injury | Radwell: complaints insufficiently plead false advertising | Court: Denied motion. Complaint alleges numerous specific false statements (quotations from listings), and pleads deception, materiality, interstate commerce, and injury. |
| False designation of origin / sponsorship confusion under § 43(a) | Rockwell: Radwell’s display of Rockwell logos and statements implying factory involvement/sponsorship cause sponsorship confusion beyond mere resale | Radwell: conduct is protected by first-sale doctrine and insufficient to show sponsorship confusion | Court: Denied motion. Rockwell pleaded actions beyond mere resale (logo use, statements of factory origin/warranty/communication) and other Bandag factors to support sponsorship confusion. |
| Trademark dilution under § 1125(c) | Rockwell: marks (Allen-Bradley/Rockwell) are famous and Radwell’s use dilutes them | Radwell: marks are not famous among the general consuming public | Court: Granted in part. Dismissed Count IV without prejudice. Rockwell’s allegations show recognition in industry but fail to plead the TDRA-required "widely recognized by the general consuming public" element; leave to amend allowed. |
| New Jersey statutory and common-law unfair competition | Rockwell: state claims mirror Lanham Act § 43(a) claims (except interstate commerce) and survive if § 43(a) claims survive | Radwell: attacks sufficiency similar to federal claims | Court: Denied motion. Because Counts II and III survive, the state unfair competition claims survive; complaint also meets the particularity concerns where applicable. |
Key Cases Cited
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (establishes plausibility pleading standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (further explains plausible-pleading and disregarding conclusory allegations)
- Fowler v. UPMC Shadyside, 578 F.3d 203 (3d Cir. 2009) (pleading standards; accept well-pleaded facts and construe in plaintiff’s favor)
- Opticians Ass’n of Am. v. Independent Opticians of Am., 920 F.2d 187 (3d Cir. 1990) (elements for § 32(1) trademark infringement)
- Iberia Foods Corp. v. Romeo, 150 F.3d 298 (3d Cir. 1998) (post-manufacture quality-control differences can be material differences affecting likelihood of confusion)
- Highmark, Inc. v. UPMC Health Plan, Inc., 276 F.3d 160 (3d Cir. 2001) (elements for false advertising under § 43(a))
- Times Mirror Magazines, Inc. v. Las Vegas Sports News, L.L.C., 212 F.3d 157 (3d Cir. 2000) (elements for trademark dilution under § 1125(c))
- Bandag, Inc. v. Al Bolser’s Tire Stores, Inc., 750 F.2d 903 (Fed. Cir. 1984) (factors for sponsorship confusion analysis)
- Beltronics USA, Inc. v. Midwest Inventory Distribution, LLC, 562 F.3d 1067 (10th Cir. 2009) (first-sale doctrine does not bar claims where plaintiff shows material differences)