Oakley, Inc. v. Bugaboos Eyewear Corp.Oakley, Inc. v. Bugaboos Eyewear Corp.
ORDER GRANTING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT ON DEFENDANT’S SEVENTH COUNTERCLAIM FOR FALSE MARKING
Defendants Bugaboos Eyewear, Corp., and Bugaboos Eyewear (U.S.) Inc., (collectively Bugaboos) allege in its counterclaim that Plaintiff Oakley, Inc. (Oakley) falsely marked its products in violation of
BACKGROUND
Oakley and Bugaboos are both in the eyewear business. On November 6, 2009, Oakley filed a first amended complaint against Bugaboos. (Doc. No. 7(FAC).) Oakley asserted claims for infringement of U.S. Design Patent D580,963, U.S. Patent 5,387,949, U.S. Patent 5,638,145, Trademark 2,393,107, Trademark 2,900,432, and Trademark 2,768,242. Six months later,
Bugaboos’ seventh counterclaim is for false marking arising under
Oakley understood Bugaboos’ counterclaim to mean that “the list of patents on the warranty card constitutes false marking because numerous patents do not all apply to the enclosed products, some patents are expired, and other patents are erroneous numbers.” (Mot. Summ. J. at 2.) And based on that understanding, Oakley brings its motion for summary judgment. Oakley argues that the warranty cards and the list of patents found on the warranty cards cannot give rise to liability under
In its opposition to Oakley’s motion, Bugaboos also raises two new issues. First, Bugaboos argues that the motion for summary judgment should be denied because Oakley’s false marking violations extend beyond the warranty cards. (Opp’n at 22-23.) Second, Bugaboos argues that Oakley’s motion is premature and additional time should be granted for Bugaboos to obtain additional discovery. (Opp’n at 23.)
Thus, this Order discusses two topics. The Court will first discuss Oakley’s motion for summary judgment. As part of this discussion, the Court will resolve the issue whether Oakley’s motion for summary judgment should be denied in light of other potential bases for false marking liability. The second portion of the Order will discuss whether Bugaboos’ request for additional discovery under
OAKLEY’S MOTION FOR SUMMARY JUDGMENT
1. Legal Standard
The initial burden of establishing the absence of a genuine issue of material fact falls on the moving party.
Celotex, 477
U.S. at 323,
Once the moving party establishes the absence of genuine issues of material fact, the burden shifts to the nonmoving party to set forth facts showing that a genuine issue of disputed fact remains.
Celotex,
2. Analysis
Before getting into the nitty-gritty, it helps to visualize the items at issue. When a consumer purchases a pair of Oakley eyewear, the consumer receives a box. 1 After opening it, the purchaser discovers— among other things — a pair of eyewear and a warranty card.
Bugaboos’ false marking counterclaim is brought under
Whoever marks upon, or affixes to, or uses in advertising in connection with any unpatented article, the word “patent” or any word or number importing that the same is patented for the purpose of deceiving the public ... [s]hall be fined not more than $500 for every such offense.
From the statutory morass, a roadmap is revealed. A plaintiff must first find some instance of “the word ‘patent’ or any word or number conveying that an article is patented.”
Once the patent coverage language has been established, the analysis moves to elements two and three. The plaintiff must show that the coverage language is “marked upon” an unpatented article, “affixed to” an unpatented article, or “used in advertising in connection with” an unpatented article. If any of the three occur, the plaintiff must finally establish element four, that the action was done with “intent to deceive the public.”
Oakley moves for summary judgement on the issue whether the warranty card found inside the packaging can give rise to false marking liability. On summary judgment, Oakley bears the initial burden of showing that the warranty cards do not satisfy
A. Element One: Patent Coverage Language
The Court begins its analysis with the first element of the statute. In doing so, the Court not only determines the scope of Oakley’s motion for summary judgment, but also lays the groundwork for the Order. On the surface, the question seems straightforward: Bugaboos need only identify the “the word ‘patent’ or any word or number conveying that an article is patented.”
For the purposes of this Order the patent coverage language is the warranty cards and the patents printed on them. Bugaboos’ counterclaim focuses entirely on the warranty cards. {See Counterclaim ¶¶ 39-87.) And Oakley’s motion for summary judgment responded in kind. Oakley understood Bugaboos’ counterclaim as alleging that “the warranty card constitutes false marking.” (Mot. Summ. J. at 2.) It was not until Bugaboos’ opposition to Oakley’s motion did Bugaboos raise the possibility of false marking based on something other than warranty cards. (Opp’n at 22-23 (discussing barcodes as potential basis for false marking).) But just because Bugaboos may have found a new source of false marking liability does not widen what is at issue in this motion. Oakley requested summary judgment only on the issue of warranty cards, and that is what the Court will adjudicate.
For clarity’s sake, the Court notes what is not at issue in this motion, and that is two things. The barcodes on the boxes are not at issue here.
{See
Opp’n at 22-23.) And more importantly the phrase that is printed on the exterior of the box— “this product may be protected by one or more U.S. and international patents identified on the packaging or enclosed warranty card” — is not at issue either. Bugaboos relies on this language to argue that the warranty cards are subject to
This latter point is important in light of
Pequignot v. Solo Cup Co.,
The important distinction between this case and Pequignot is that Pequignot discussed the “may be covered” language on the packaging. Id. Here, the coverage language at issue is not the “may be protected” language on Oakley’s box: it is Oakley’s warranty cards. Any discussion of Pequignot on this matter is irrelevant. If Pequignot had discussed whether the contents of the website found at www. solocup.com could be subject to false marking liability, the Court might find the case useful. But it didn’t, so the Court doesn’t.
The narrow focus of the motion for summary judgment raises another issue. Bugaboos argues that Oakley’s motion is not appropriately adjudicated at this time if it focuses on the warranty cards only. Bu
At this point, the Court has determined that the entity satisfying the “the word ‘patent’ or any word or number conveying that an article is patented” portion of the false marking statute is the warranty card. And with that, the Court moves to the next two elements.
B. Elements Two and Three
These elements — particularly element two — constitute the main dispute. Whether the warranty cards satisfy these elements determines whether Oakley has met its burden on summary judgment. And after considering the matter, the Court finds that no issue of material fact remains. The warranty cards cannot be subject to
Elements two and three of the statute are: “(2) marked on, affixed to, or used in advertisement in connection with, (3) an unpatented article.” “Unpatented article” has been defined in the
(1) Marked On
Here, the issue is whether warranty cards and the list of patents printed on the warranty cards can be subject to the false marking statute by virtue of being “marked on” an unpatented article, the Oakley eyewear. The operative phrase is “marked upon.”
It is undisputed that the neither the warranty card nor the contents of the warranty card are marked upon the eyewear. This is not fatal to Bugaboos’ false marking claim, however, because it is possible for markings on the packaging of an item to be subject to the false marking statute.
See Pequignot,
Bugaboos argues that the warranty cards are incorporated onto the packaging because printed on the packaging is the statement “this product may be protected by one or more U.S. and international patents identified on the packaging or enclosed warranty card.” (See Opp’n at 12.) But Bugaboos provides no authority for the argument that incorporation is sufficient to meet the “marks upon” requirement. And the Court finds the notion contrary to the plain meaning of the language.
On this issue, the parties expend considerable ink discussing the finer points of patent law — none of which the Court finds relevant. For instance, the parties contest whether a marking must provide constructive notice under
Bugaboos does raise one case that could provide support for the proposition that a coverage found inside packaging can satisfy the “marked upon” portion of the statute. The district court in
Clontech,
held a bench trial concerning, among other things, false marking of Invitrogen’s products. One finding of fact was that Invitrogen had marked “the product profile sheets” of its products.
Clontech,
A closer reading of
Clontech
proves the issue less clear cut. The district court found that Invitrogen “marked the product profile sheets of SS, SSII, kits including SSII, and cDNA libraries.”
Clontech,
In fact, the issue of wrongful marking was a non-issue; Invitrogen conceded the point. The Clontech court never discussed out what constituted the patent coverage language. It didn’t need to because plenty of items clearly satisfied that requirement. Instead, “the gravamen of plaintiffs false marking claim [was] whether or not defendant marked its products ‘with intent to deceive the public.’” Id. at 792. Given the facts of the case, this Court will not infer from Clontech that items found inside the packaging satisfy the “marks upon” language of the false marking statute.
The Court finds, as a matter of law, that the warranty cards and the patents listed on them cannot be subject to the false marking statute under the “marks upon” language. The warranty cards are not marked upon the glasses or the packaging. The statutory language seems clear, and the Court applies it accordingly.
(2) Affixed To
As noted before, each box contains a warranty card and a pair of eyewear. The issue here is whether the warranty cards are affixed to the eyewear in a manner subjecting the warranty cards to false marking liability. Bugaboos provides that “a common definition of the word ‘affix’ is to ‘attach in any way.’ ” (Opp’n at 17.) And Bugaboos argues that the warranty card is attached to “each Oakley eyewear product by virtue of the way in which they are tightly packaged with each product.” (Id.) But this argument fails as a matter of law: one pea in a pod is not affixed to the other. While the warranty card and the eyewear are tightly packaged together, doing so does not render one affixed to the other.
(3) Used in Advertising in Connection With
The final issue is whether the warranty cards are “used in advertising in connection with” the eyewear, and thus subject to false marking liability.
The first step is to determine whether “advertising” has a “plain and unambiguous meaning with regard to the particular dispute in the case.”
Robinson v. Shell Oil Co.,
“Case law interpreting a similar term under the Lanham Act provides further guidance.’ ”
Inventorprise, Inc. v. Target Corp.,
But this definition is actually too broad for our purposes. For where the Lanham Act concerns both “advertising” and “promotion,” the patent false marking statute concerns only “advertising.”
See Chamilia, LLC v. Pandora Jewelry, LLC,
Given the plain meaning of “advertising” and the body of law interpreting “advertising” in the Lanham context, the Court finds that Oakley’s warranty cards are not “advertising” subject to false marking liability. Oaldey’s warranty cards are found inside the packaging; they are invisible until the product is purchased and the packaging opened. And in that regard, they are not used to call something to the attention of the public by way of paid announcement. Advertising, Merriam-Webster.com, http://www.merriamwebster.com. It would be impossible for them to call attention to the eyewear before the eyewear is purchased.
The Lanham Act provides additional support. The Court finds no situation in which the warranty cards, contained inside the packaging, could influence customers to buy Oakley’s eyewear.
See Newcal Indus.,
Many courts have cited to
Accent Designs, Inc. v. Jan Jewelry Designs, Inc.,
Bugaboos attempts to create an issue of material fact regarding the warranty cards status as “advertisement” by entering the declaration of an expert witness. (Opp’n, Nunes Decl.) But the expert’s testimony is irrelevant under the circumstances because, as noted above, statutory interpretation falls under the purview of the Court.
At oral argument, Bugaboos argued that the warranty cards also constitute advertising sufficient for
Section
After construing “advertising” as it is found in the false marking statute, the Court finds that Oakley’s warranty cards are not subject to false marking liability on that grounds that they are “use[d] in advertising in connection with any unpatented article.”
3. Conclusion
Having determined that the warranty cards are the patent coverage language at issue, the Court then considered whether the warranty cards could satisfy elements two and three of
First, the warranty cards and their contents are not marked upon the eyewear or upon the outer packaging. Thus, Bugaboos’ counterclaim fails as a matter of law as to this portion of the statute. The Court finds unpersuasive the argument that the warranty cards are incorporated onto the outer packaging. The Court also finds unpersuasive the argument that something found inside the packaging can be subject to the false marking statute. Second, the warranty cards cannot be affixed to the glasses by virtue of close proximity. Bugaboos counterclaim fails as a matter of law as to this portion of the statute. And finally, the warranty cards are not advertising as a matter of law. The plain meaning of “advertising” and its construction under the Lanham Act forecloses the possibility that warranty cards found inside packaging and available to consumers only after purchase can be considered advertising.
No issues of material fact remain. Oakley’s motion for summary judgment on the issue whether the warranty cards can be subject to
BUGABOOS’ RULE 56(f) MOTION
Bugaboos argues that it “has been unfairly prejudiced by Oakley’s premature summary judgment motion and requests additional discovery responses so that it can fully expose Oakley’s false marking practices.” (Opp’n at 23.)
Bugaboos argues that “Oakley has still not produced all versions of the warranty cards that are the subject of its motion and has still not produced all samples of its products, product packaging and marking for eyewear products.” (Opp’n, LaPorte Decl. ¶ 12.) The Court finds that these sought-after-facts are not essential to resist Oakley’s motion for summary judgment.
Obtaining all versions of the warranty cards would not overcome the fact that the warranty cards are not subject to the false marking statute as a matter of law. Bugaboos’ attempts to subject the warranty cards to false marking liability fail for reasons that cannot be remedied by additional facts. For instance, Bugaboos argues that the warranty cards are “marked upon” the packaging because of a turn-of-phrase found on the packaging. The Court rejects this theory. Reviewing additional warranty cards would not solve Bugaboos’ shortcomings.
Bugaboos also requests discovery on additional “products, product packaging and marking for eyewear products.” (Id.) These requests are unrelated to the motion at hand, which concerns the warranty cards only.
Bugaboos requests the Court to continue or deny Oakley’s motion for summary judgment pending further discovery. But the Court finds that the additional discovery Bugaboos requests is orthogonal to the motion being considered. Thus, Bugaboos
CONCLUSION
In response to Bugaboos’ counterclaim for false marking under
IT IS SO ORDERED.
Notes
. The box is often referred to as "packaging.”