Petition for Writ of Certiorari — Munters Corp. v. Matsui America, Inc.

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Supreme Cort, U.S.

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90-588 OCT § 1999

No. 90- ~ JOSEPH F. SPANIOL, JR.

mGbl- RIK

IN THE

Supreme Court of the United States

OcTosBER TERM, 1990

THE MUNTERS CORPORATION,

Petitioner,

VS.

MATSUI AMERICA, INC.,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

PASQUALE A. RAZZANO

Counsel of Record

Curtis, Morris & SAFFORD, P.C.

Attorneys for Petitioner

530 Fifth Avenue

New York, New York 10036

(212) 840-3333

QUESTIONS PRESENTED

;. Whether the Seventh Circuit Court of

Appeals erred in ruling, contrary to the holdings of the

other Circuits, e.g., Wynn Oil Co. v. Thomas, 839 F.2d 1183

(6th Cir. 1988) and Dieter v. B&H Industries of Southwest

Florida, Inc., 880 F.2d 322 (11th Cir. 1989), that in deter-

mining the likelihood of confusion between marks in an in-

fringement action under the Trademark Act of 1946

(Lanham Act), 15 U.S.C. 1051 et seqg., an "incontestable"

trademark is not presumed to have at least the strength of

a descriptive mark with secondary meaning?

4. Whether the Seventh Circuit Court of

Appeals erred in ruling, contrary to the holdings of other

Circuits, that Matsui America, Inc. could defend the

infringement claims of The Munters Corporation on the

ground that the mark was merely descriptive after Munters’

mark had achieved incontestable status under the Trade-

mark Act of 1946 (Lanham Act), 15 U.S.C. 1051 et seq., thus

defeating a registrant’s right to offensive use of its mark’s

incontestability in determining the question of likelihood of

confusion between marks?

3. Whether the Seventh Circuit Court of

Appeals adopted an interpretation of 15 U.S.C. §1115(b)

which is contrary to the plain language of the statute and to

the accurately expressed legislative purpose thereof?

4. Whether the Seventh Circuit Court of

Appeals erred in affirming the District Court’s ruling that

Matsui’s use of a mark in the same way that the trademark

owner, Munters, used the mark is a "fair use" uncer Section

1115(b)(4) of the Lanham Act, an important question of

federal law which has not been but should be decided by

this Court?

PARTIES

The parties named in the caption are the

only parties to this action.

Pursuant to Supreme Court Rule 28.1,

petitioner, The Munters Corporation, identifies its parent

companies, subsidiaries (except wholly owned subsidiaries)

and affiliates, as follows:

AB Carl Munters (parent)

Fack

S-191 Sollentuna 1

Sweden

ill

TABLE OF CONTENTS

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The Writ Of Certiorari Should Be Allowed

To Resolve A Direct Conflict Among

ETC. SS Ca Ri SS ee

The Seventh Circuit’s Interpretation Of

The Incontestability Provision Of The

Lanham Act Is An Incorrect Application Of

a PA eee eT Tee eee

The Seventh Circuit’s Interpretation Of The

"Fair Use" Provision Of The Lanham Act

Is An Incorrect Application Of Federal Law. . .

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TABLE OF AUTHORITIES

Page

A.J. Canfield Co. v. Vess Beverages, 796 F.2d 903 (7th

Ce. TED wreeniersievncnnriselinuaiinsttnsieiibdahaaiilaaiieatiinaeainebnetiaanaanlinaban 29

Abercrombie & Fitch Co. v. Hunting World, Inc., 537

Frac 6 Gs FSU cnciseenrecnctinneniniiciieninens 25

Beer Nuts, Inc. v. Clover Club Foods Company,

SES F. 0 Tae CORI Gat, TIED ctcrectncsrtieetsrsreirencinne 20, 21

Clamp Manufacturing Company, Inc. v. Enco Manu-

facturing, 870 F.2d 512 (9th Cir. 1989)... ceeseeseeeees 19

Consumer Product Safety Commission v. GTE

Sylvania, Inc., 447 U.S. 102, 100 S. Ct. 2051 (1980)........ 24

Dieter v. B&H Industries of Southwest Florida, Inc.,

880 F.2d 322 (11th Cir. 1989) occ cccesesseseeees 8, 23, 33

John R. Thompson Co. v. Holloway, 366 F.2d 198

I E.R scisinnscncssnssnasnaiesnnbiectettineinsastieabineniisadaanciatnamenies 25

Mishawaka Rubber & Woolen Manufacturing Co. v.

S.S. Kresge Co., 316 U.S. 203 (1942) ..........ccccccccscsesseees 27

Mobil Oil Corp. v. Mobile Mechanics, Inc.,

BOE CEs PS Ce GE, IIe cccssecensenstnccinssnenstnensinnns 26

Park ’N Fh, Inc. v. Dollar Park & Fly, Inc.,

eek) ha eo . Seen 7, 15, 18, 24

Snap-On Tools Corp. v. Winkenweder & Ladd, Inc., 150

F. Supp. 792 (D.C.N.D. Ill., 1956) affd, 250 F.2d 154

CRUD Gee CRPTE cacecnissrtnncinicninsitentnacndemmndaainmmannmadaall 29

Page

vource Services Corp. v. Chicagoland Jobsource, Inc.,

643 F. Supp. 1523 (N.D. Ill. 1986) ..........ccceeseesees 13, 21

Source Services Corp. v. Source Telecomputing, 635 F.

Samm. GOD CICID. GE, BBBG) oecesescscereresevseresessessscnscsssssnsensens 13

Soweco, Inc. v. Shell Oil Co., supra, 617 F.2d 1178

IS Spee UIE sinecnnsnennsnnrsnnnennnitnscnsnpnuisenninaiutsntneinineannaasenanann 25

Union Carbide Corp. v. Ever-Ready, Inc., supra, 531

F.2d 366 (7th Cir.) cert denied,

ey ts ee CO TED cttkeninerpeineneniecisnaennnn 22, 23, 25

United States v. Turkette, 452 U.S. 576,

ee a a I 0 UN Dicccacecieberserernininenndininaicisniemnnaaneeniii 24

Venetianaire Corp.v. A&P Import Co., 429 F.2d 1079

ge ERENCE eneNrennenen Ter RU ene Cn a er eve et en 46

Wynn Oil Co. v. Thomas, 839 F.2d 1183

UE STE IEUUUTIED: sininsiectnnnnedsscesieennishasnidpubiiainnnateninnneanienaaen ee

STATUTES

Sa ETEs STU EEET stnnsinnsnnnevintesinbansintanenteninaiaainnaeniianiol 7

Sr TIT: MNEIITIITY Siintiadnneatensinnehantentabannennntansssnanadeannanenaeisaniniannts 15

gE” ak __ SRRERTERYoUevenvevoreDronevvenveuUNTOU TORENT TT TITTIET 7, 10, 16

se IE TD, ceteceiecnninrnenisninneneennnnnnanntenininmnianaanennannaeiiinein 9

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Vii

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Be STE, Ge cnccceestecnntnninninetenecensnneentaiiennenniaiatnin 9

OE eis CET iticninicreenssisntsinninnrescsensiensniiainnasiiantsiinnanteniianaiie 28

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Be WEA. GEO cenecnnnctntnnieennin tins eminantecananeentinnianiatonneen 9

MISCELLANEOUS

B&H Industries of Southwest Florida, Inc. v.

Richard A. Dieter et al., NO. 89-1193 cocccccccccccccccesseees 10, 34

Sen. Rep. No. 1333, 79th Cong., 2d Sess (1946),

U.S. Code Cong. Serv. 1946, p.1277 .......cccccsseesseesesees 37

Patent, Trademark & Copyright Journal, BNA,

VUE, GR, BUR, TU, TE cennnseetenneeenteeneeneeeenens 22

In The

Supreme Court of the United States

October Term, 1990

THE MUNTERS CORPORATION,

Petitioner,

MATSUI AMERICA, INC.,

Respondent.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SEVENTH CIRCUIT

Petitioner hereby requests that this Court issue a

writ of certiorari to review a judgment of the United States

Court of Appeals for the Seventh Circuit entered August 2,

1990.

OPINIONS BELOW

The opinion of the United States Court of Appeals

for the Seventh Circuit, which is reported at 909 F.2d 250,

(7th Cir., 1990), is reprinted as Appendix A, pp. A1-5, of

this petition.

The opinion of the United States District Court for

the Northern District of Llinois, reported at 703 F. Supp.

790, (N.D. Ill., 1989) is reprinted in the Appendix at pp.

A6-36.

JURISDICTION

The judgment of the Court of Appeals For The

Seventh Circuit was entered in this action on August 2,

1990.

This petition for certiorari is filed within ninety (90)

days of that date.

Neither party requested rehearing.

The jurisdiction of this court is invoked pursuant to

28 U.S.C. §1254(1).

STATUTES INVOLVED

The statutes involved in this petition are 15 U.S.C.

§§1065 and 1115, which provide in full as follows:

§1065 Right To Use Mark Incontestable Under

Certain Conditions

Except on a ground for which application to

cancel may be filed at any time under paragraphs

(3) and (5) of section 14 of this Act, and except to

the extent, if any, to which the use of a mark regis-

tered on the principal register infringes a valid right

acquired under the law of any State or Territory by

use of a mark or trade name continuing from a date

prior to the date of registration under this Act of

such registered mark, the right of the registrant to

use such registered mark in commerce for the goods

or services on or in connection with which such

registered mark has been in continuous use for five

consecutive years subsequent to the date of such

registration and is still in use in commerce, shall be

incontestable: Provided, That-

(1) there has been no final decision

adverse to registrant’s claim of ownership of such

mark for such goods or services, or to registrant’s

right to register the same or to keep the same on

the register; and

(2) there is no proceeding involving said

rights pending in the Patent and Trademark Office

or in a court and not finally disposed of; and

(3) an affidavit is filed with the Commis-

sioner within one year after the expiration of any

such five-year period setting forth those goods or

services stated in the registration on or in connec-

tion with which such mark has been in continuous

use for such five consecutive years and is still in use

in commerce, and the other matters specified in

paragraphs (1) and (2) of this section; and

(4) no incontestable right shall be ac-

quired in a mark which is the generic name for the

goods or services of a portion thereof, for which it

is registered.

Subject to the conditions above specified in

this section, the incontestable right with reference to

a mark registered under this Act shall apply to a

mark registered under the Act of March 3, 1881, or

the Act of February 20, 1905, upon the filing of the

required affidavit with the Commissioner within one

year after the expiration of any period of five

consecutive years after the date of publication of a

mark under the provisions of subsection (c) of

section 12 of this Act.

The Commissioner shall notify any registrant

who files the above-prescribed affidavit of the filing

thereof.

§1115 Registration is Prima Facie Evidence;

Defenses

(a) Any registration issued under the Act

of March 3, 1881, or the Act of February 20, 1905,

or of a mark registered on the principal register

provided by this Act and owned by a party to an

action shall be admissible in evidence and shall be

prima facie evidence of the validity of the registered

mark and of the registration of the mark, of the

registrant’s ownership of the mark, and of the regis-

trant’s exclusive right to use the registered mark in

commerce on or in connection with the goods or

services specified in the registration subject to any

conditions or limitations stated therein, but shall not

preclude another person from proving any legal or

equitable defense or defect, including those set forth

in subsection (b), which might have been asserted if

such mark had not been registered.

(b) Tothe extent that the right to use the

registered mark has become incontestable under

section 15, the registration shall be conclusive

evidence of the validity of the registered mark and

of the registration of the mark, of the registrant’s

ownership of the mark, and of the registrant’s

exclusive right to use the registered mark in com-

merce. Such conclusive evidence shall relate to the

exclusive right to use the mark on or in connection

with the goods or services specified in the affidavit

filed under the provisions of section 15, or in the

renewal application filed under the provisions of

section 9 if the goods or services specified in the

renewal are fewer in number, subject to any condi-

tions or limitations in the registration or in such

affidavit or renewal application. Such conclusive

evidence of the right to use the registered mark

shall be subject to proof of infringement as defined

in section 32, and shall be subject to the following

defenses or defects:

(1) That the registration or the incontest-

abie right to use the mark was obtained fraudulent-

ly; or

(2) That the mark has been abandoned

by the registrant; or

(3) That the registered mark is being

used, by or with the permission of the registrant or

a person in privity with the registrant, so as to

misrepresent the source of the goods or services on

or in connection with which the mark is used; or

(4) That the use of the name, term, or

device charged to be an infringement is a use,

otherwise than as a mark, of the party’s individual

name in his own business, or of the individual name

of anyone in privity with such party, or of a term or

device which is descriptive of and used fairly and in

good faith only to describe the goods or services of

such party, or their geographic origin; or

(5) That the mark whose use by a party

is charged as an infringement was adopted without

knowledge of the registrant’s prior use and has been

continuously used by such party or those in privity

with him from a date prior to (A) the date of

constructive use of the mark established pursuant to

section 7(c), (B) the registration of the mark under

this Act if the application for registration is filed be-

fore the effective date of the Trademark Law

Revision Act of 1988, or (C) publication of the

registered mark under subsection (c) of section 12 of

this Act: Provided, however, That this defense or

defect shall apply only for the area in which such

continuous prior use is proved; or

(6) That the mark whose use is charged

as an infringement was registered and used prior to

the registration under this Act or publication under

subsection (c) of section 12 of this Act of the reg-

istered mark of the registrant, and not abandoned:

Provided, however, That this defense or defect shall

apply only for the area in which the mark was used

prior to such registration or such publication of the

registrant’s mark; or

(7) | That the mark has been or is being

used to violate the antitrust laws of the United

States; or

(8) That equitable principles, including

laches, estoppel, and acquiescence, are applicable.

————

STATEMENT OF THE CASE

Introduction

This case involves a conflict among the circuits with

regard to the basic rights of the holders of trademarks

under the Lanham Act, 15 U.S.C. §1051-1127. In the

decision from which Petitioner seeks a writ of certiorari, the

Seventh Circuit, contrary to at least the Sixth and Eleventh

Circuits,’ has held that a trademark registrant may not

obtain injunctive relief against an alleged infringer in

reliance on the incontestable status of its mark.? The

Seventh Circuit Court of Appeals ruled that even though a

registrant’s mark has achieved incontestability status under

15 U.S.C §1065, the incontestability of the mark is to be

given no weight in the determination of likelihood of

confusion and the accused infringer may challenge the mark

as "weak" or descriptive and without secondary meaning.

This statutory interpretation was made despite the fact that

"descriptiveness" is not enumerated in the statute as a

defense to an incontestable mark. Thus the Court ruled

that a registrant may not obtain injunctive relief based on

the conclusive presumption provided by 15 U.S.C §1115(b)

that the mark is not merely descriptive.

1 Wynn Oil Co. v. Thomas, 839 F.2d 1183 (6th Cir.

1988); and Dieter v. B&H Industries of Southwest Florida,

Inc., 880 F.2d 322 (11th Cir. 1989).

2 Pursuant to 15 U.S.C. §1115(b) incontestable

status of a registered mark means that the registration is

"conclusive evidence...of the registrant’s exclusive right to

use the registered mark in commerce," subject to certain

enumerated defenses. Park ’N Fby, Inc. v. Dollar Park and

Fly, Inc., 469 U.S. 189, 194, 105 S. Ct. 658, 661-662 (1988).

The Seventh Circuit, acknowledging its conflict with

critics in other Circuits, held that incontestability only

provides a defense to an attack on the validity of a federal

trademark registration but does not prevent an accused

infringer from challenging the mark as merely descriptive in

determining the issue of likelihood of confusion. Thus the

Court held, in effect, that incontestability does not permit

the registrant to use the mark offensively to enjoin the use

of the mark by another.

This same issue is presently the subject of a petition

for certiorari in the case of B&H Industries of Southwest

Florida, Inc. v. Richard A. Dieter et al., No. 89-1193.? In that

case this Court invited the Solicitor General of the United

States to file a brief expressing the views of the United

States on the issue. The Solicitor General’s amicus curiae

brief notes the conflict in the Circuits mentioned here and

specifically refers to the Seventh Circuit’s decision in this

case as demonstrating that conflict. The Solicitor General

therefor recommended review by this Court of that conflict;

that conflict is the same conflict for which review is sought

in this case.

The Seventh Circuit also affirmed the ruling of the

District Court that Matsui America’s use of the mark was

a “fair use" under §1115(b)(4) of the Lanham Act. In doing

so, the District Court concluded that Matsui did not use the

mark as a trademark. This Court has not previously

considered the requirement of the Lanham Act’s "fair use"

defense that the use be "otherwise than as a mark".

> On petition from the decision in Dieter v. B&H

Industries of Southwest Florida, Inc., supra.

—————

The District Court Case

This trademark infringement action was originally

brought in the United States District Court for the Northern

District of Illinois. Plaintiff, The Munters Corporation

(Munters) charged defendant, Matsui America, Incorporat-

ed (Matsui) with infringement of Munters’ registered

trademark "HONEYCOMBE" and sought injunctive relief

pursuant to 15 U.S.C §§1114(1) and 1117. Matsui counter-

claimed, seeking a declaratory judgment that its use of

"Honeycomb" on its products was not an infringement of

Munters’ "HONEYCOMBE" mark.

Jurisdiction was vested in the District Court pursu-

ant to 15 U.S.C §1121 and 28 U.S.C. §1338.

Munters manufactures in this country and sells

industrial environmental control apparatus, such as heating,

ventilation, and cooling equipment, including dehumidifying

apparatus. All Munters’ dehumidifying apparatus uses a

wheel or rotor formed of spirally wound layers of corrugated

paper sheets coated with a desiccant material.‘ In the

dehumidifying apparatus the wheel is slowly rotated and

moist air is passed through the channels formed in the

wheel. The moisture in the air is removed, i.e., absorbed, by

the desiccant material. The moisture is then removed from

the wheel by subjecting the wheel to hot air flow in a small

part or sector of its path of rotation.

For about thirty years Munters (and its predecessor

company Cargocaire) has been the exclusive source in the

* A desiccant material is a drying agent applied to

the surfaces of the corrugated paper to absorb moisture.

United States for dehumidifiers using desiccant wheels of

this type.

Since 1960 Munters has sold dehumidifying appara-

tus, namely dehumidifiers and desiccant wheels, under or in

connection with the trademark HONEYCOMBE. Munters

refers to the dehumidifier units as "HONEYCOMBE

dehumidifiers" and to the desiccant wheels (which are also

sold separately as replacement parts) as "HONEYCOMBE

wheels" or rotors.

Munters’ HONE YCOMBE dehumidifying apparatus

is useful in a wide range of industries. One such industry is

the plastics industry. In that industry Munters’ dehumidify-

ing equipment is used for several purposes, e.g., in the

drying of plastic injection molds, drying of mold rooms, and

drying of resin or plastic granules. Munters’ dehumidifier

products have been sold to the plastics industry for more

than 10 years.

In October of 1961 Munters obtained Federal

Trademark Registration No. 722,581 for the trademark

HONEYCOMBE which it uses in connection with its

dehumidifying apparatus. On October 10, 1967 Munters

filed an affidavit with the Patent and Trademark Office in

order to establish the incontestability of its mark in accor-

dance with 15 U.S.C §1065. The mark thus achieved

incontestable status, which established Munters’ right to

exclusive use of the mark subject only to the cancellation

provisions of 15 U.S.C §1064 and the defenses enumerated

in 15 U.S.C §1115(b). The registration was renewed by

October 10, 1981. The registration lists the goods it covers

as "dehumidifying apparatus."

“_ ee

In about 1984 Matsui Manufacturing (Matsui’s

parent company in Japan) began marketing a dehumidifier

in Japan using a desiccant wheel rotor similar in structure

to Munters’ wheel. In about 1986 Matsui was started in this

country and began selling dehumidifier apparatus under the

mark "Dehume Jet HONEYCOMB DMZ," with the word

HONEYCOMB in type at least twice as large as the other

words. Matsui’s dehumidifier apparatus was offered to the

plastics industry as a resin or granule hopper dryer, ie., a

device located adjacent a mold and which dries plastic

granules before they are melted and injected into the mold.

Munters first became aware of Matsui’s use of the

HONEYCOMB mark in November, 1987 as a result of a

report concerning Matsui’s "HONE YCOMB Dehumidifying

Unit" in Plastics Technology magazine.

By letter dated December 7, 1987, Munters’ counsel

advised Matsui of Munters’ objection to Matsui’s use of the

mark HONEYCOMB. The letter demanded that Matsui

“cease and desist from all further uses of the term HONEY-

COMB in the manner complained of herein..." After a

period of negotiation Matsui’s counsel proposed that:

without any waiver of rights which MATSUI

AMERICA, INC. has to use the subject words

generally..MATSUI AMERICA INC. is willing to

discontinue the use of the word "HONEYCOMB" in

its advertising materials, provided that it is allowed

to deplete its current stock of brochures and cata-

logs...

Thereafter, MATSUI AMERICA INC. will

delete from (or cease using in) its product literature

es eee

and brochures ie word HONEYCOMB... (emphasis

added)

Matsui’s counsel’s proposal was accepted by a letter

of May 26, 1988 from Munters’ counsel "provided, however,

that no use occurs after November 1, 1988." Sometime

thereafter a copy of the May 26, 1988 letter was returned to

Munters’ counsel signed by an officer of Matsui beneath the

inscription:

Subject to the terms of the May 26, 1988 let-

ter, MATSUI AMERICA, INC. agrees it will no

longer use "HONEYCOMB" as a trademark after

November 1, 1988.

In about March of 1989 Munters became aware that

Matsui had placed an advertisement in Plastics Technology

magazine in which Matsui repeatedly and prominently used

“the word "HONEYCOMB" in the term "Honeycomb rotor."

When Munters learned of Matsui’s March 1989 ad

it filed this suit in the Federal District Court in the North-

ern District of Illinois. Munters sought a preliminary

injunction, which was granted by the District Court on June

29, 1989.

During the preliminary injunction proceedings, trial

and post-trial proceedings, Munters argued, inter alia, that

Matsui had infringed Munters’ incontestable mark and that

the infringement should therefore be enjoined. Munters

argued further that Matsui’s contention that the mark was

merely descriptive and "weak" should not be heard because

such a defense was not available to an accused infringer of

a mark that had properly achieved incontestable status

under §1065.°

Matsui stressed that the mark was merely descrip-

tive, that it had a right to make such an argument in

connection with the determination of likelihood of confusion

between the marks, and that incontestability was not a

factor to be considered in a likelihood of confusion analysis.

After issuing the preliminary injunction enjoining

Matsui’s use of HONEYCOMB, the District Court, on

August 31, 1989, conducted a trial on the issue of whether

Munters was entitled to a permanent injunction. On

October 25, 1989, the District Court denied Munters’

demand for a permanent injunction. Munters filed its

Notice of Appeal on November 22, 1989.

The District Court concluded that it would give no

consideration to the incontestability of Munters’ registration

in analyzing the issue of likelihood of confusion, relying on

two earlier District Court decisions in the Northern District

of Illinois for the proposition that "the conclusive pre-

sumption that the marks [are non-descriptive, or if descrip-

tive,] have secondary meaning established by the statutory

incontestability of plaintiff’s...mark does not automatically

transfer to a conclusive presumption of strength in a

likelihood of confusion analysis" citing Source Services Corp.

v. Source Telecomputing, 635 F. Supp. 600, 610 (N.D. Il.

1986); and Source Services Corp. v. Chicagoland Jobsource,

Inc., 643 F. Supp. 1523 (N.D. Ill. 1986).

* Munters also argued that the mark was not merely

descriptive in any event.

The District Court went on to analyze the issue of

the “strength” of Munters’ HONEYCOMBE mark and

found that as applied to its desiccant wheels the mark was

"descriptive" and "relatively weak". A-21. Therefore, the

District Court concluded there would be no likelihood of

confusion.

The District Court further held that in any event

Matsui’s use of HONEYCOMB was a fair use under 15

U.S.C. §1115(b)(4) because Matsui used it "merely" to

describe its desiccant wheel.

Matsui had used "HONEYCOMB" in several

different ways, as follows:

1. In print advertising

Honeycomb rotor

2. In its brochure:

a) In connection with its dryer

Honeycomb Grying system

b) As an adjective for "rotor"

HONEYCOMB ROTOR

9) in a descriptive sentence

is constructed like a honeycomb.

The Seventh Circuit Appeai

Munters appealed the decision of the District Court

on the grounds that the District Court erred in finding no

likelihood of confusion and particularly on the grounds that

aren es an i

the District Court erred in requiring proof of secondary

meaning for Munters’ mark despite its "incontestable" status

thereby giving no effect to the mark’s incontestable status in

the likelihood of confusion analysis. Munters also argued

that the District Court erred in ruling that Matsui’s above

noted uses of the word "HONEYCOMB" were not a trade-

mark use in the Court’s consideration of Matsui’s “fair use"

defense.

On appeal, Munters argued, inter alia, that the

offensive/defensive differentiation made by the District

Court with respect to Munters’ incontestable trademark was

settled and eliminated by this Court in its decision in Park

'N Fb, Inc. v. Dollar Park & Fly, Inc., 469 U.S. 189, at 196;

105 S. Ct. 658 at 662 (1985). Munters also argued that the

District Court’s decision with respect to the effect of

incontestability in a likelihood of confusion determination

was in direct conflict with the decisions of the Courts of

Appeals in at least the Sixth and Eleventh Circuits in Wynn

Oil Co. v. Thomas, 839 F.2d 1183, 1187 (6th Cir. 1988) and

Dieter v. B&H Industries of Southwest Florida, Inc., 880 F.2d

322 (11th Cir. 1989).

The Seventh Circuit affirmed the decision of the

District Court that no effect be given to the incontestability

of a mark in the likelihood of confusion analysis. Without

expressly citing the conflicting Sixth and Eleventh Circuit

decisions the Court of Appeals stated "[t]he most that can

be said by critics is that this Court’s practice of including a

strength of the mark component in its likelihood of confu-

sion analysis is a practice that is, itself, likely to cause

confusion." A-4. In effect, the Seventh Circuit found that

a party could defend against the effect of federal registra-

tion on grounds not included in §1115(b) and that Munters’

mark, although not susceptible to cancellation as being

merely descriptive, was merely descriptive and therefore not

sufficient to support injunctive relief.

The Court of Appeals also affirmed the District

Court’s decision with respect to "fair use.”

REASONS FOR ALLOWING THE WRIT

Introduction

The Seventh Circuit opinion in this case should be

reviewed on a writ of certiorari by this Court because it is

in direct conflict with other circuits and because it is based

on a faulty interpretation and application of federal trade-

mark laws.

The Lanham Act provisions at the heart of this

appeal involve the status and effect of incontestability.

Under 15 U.S.C. §1065 (Section 15 of the Lanham Act) a

federal registered trademark becomes incontestable under

certain conditions. The mark must not be the subject of a

final, adverse decision as to its ownership or registration,

nor may such a proceeding be pending. §1065(1) and (2).

To achieve incontestability the registrant must file an

affidavit testifying that the conditions in subsections (1) and

(2) have been met, and that the mark has been used

continuously in commerce for five years. §1065(3).

As noted above, Munters complied with the prereq-

uisites for incontestability and the status was granted.

Consequently, it became entitled to the Lanham Act

protection provided in §1115(b), which states in pertinent

part that "the registration shall be conclusive evidence of

registrant’s exclusive right to use the registered mark in

commerce” (emphasis supplied), subject to the seven

defenses set out in §1115(b).

The Writ Of Certiorari Should Be Allowed To

Resolve A Direct Conflict Among The Circuits

The Seventh Circuit ruled in the instant case that

Section 1115(b) of the Lanham Act has no bearing on the

determination of likelihood of confusion and thus that it

provides no offensive basis for a registrant with an incon-

testable mark to enjoin the use of an infringing mark. In

essence, the Court’s ruling means that an accused infringer

can defend against the effect of a federal registration as if

the mark in question were not incontestable - indeed as if

it were not registered at all. Thus, the District Court and

the Court of Appeals allowed Matsui to argue that the mark

at issue was merely descriptive. They both then found the

mark to be merely descriptive without secondary meaning

and defeated Munters’ effort to protect the mark.

The effect of the Court of Appeals’ decision is to

continue to treat incontestability of trademarks as a "defen-

sive” issue (ie., a shield against an attack of invalidity),

while refusing to give them "offensive" effect as having

"strength" when considering the issue of infringement. This

offensive/defensive distinction is contrary to this Court’s

decision in Park ’N Fly, and is contrary to the decisions of

several Circuit Courts of Appeals which have considered

this issue since Park ’N Fly.

A trademark either does or does not have secondary

meaning. It is inconsistent and contrary to law for the

Courts below to say that 1) for one purpose (validity)

Munters’ mark is conclusively presumed to be non-descrip-

tive, or to have secondary meaning (A-17) and, 2) for an-

‘

other purpose (likelihood of confusion) it is "merely descrip-

tive” (A-21) or “descriptive” and "not bolstered by any

secondary meaning" (A-22).

The offensive/defensive differentiation made below

with respect to Munters’ incontestable trademark was set-

tled and eliminated by this Court in 1985:

One searches the language of the Lanham Act in

vain to find any support for the offensive/defensive

distinction applied by the Court of Appeals. The

Statute nowhere distinguishes between a registrant’s

offensive and defensive use of an incontestable

mark. On the contrary, §33(b)’s declaration that the

registrant has an exclusive right to use the mark

indicates that incontestable status may be used to

enjoin infringement by others. A conclusion that

such infringement cannot be enjoined renders

meaningless the "exclusive right" recognized by the

statute. Moreover, the language in three of the de-

fenses enumerated in §33(b) clearly contemplated

the use of incontestability in infringement actions by

plaintiffs. See §§33(b) (4)-(6), 15 U.S.C. §1115(b)

(4)-(6).

Park ’N Fhby, Inc. v. Dollar Park & Fly, Inc., 469 U.S. 189, 196;

105 S. Ct. 658, 662 (1985).

Furthermore, this-Court went on to hold that "a

conclusion that incontestable status can provide the basis for

enforcement of the registrant’s exclusive right to use a trade

or service mark promotes the goals of the statute.” Park ’N

Fly, supra, 469 U.S. at 663.

————————— <<

Following the Park 'N Fly decision several Circuit

Courts of Appeals have considered the question of the

relative strength to be accorded incontestable marks in

determining likelihood of confusion in an infringement

action.

In Wynn Oil Co. v. Thomas, 839 F.2d 1183, 1187

(1988), the Sixth Circuit Court of Appeals in discussing the

issue of "Strength of Mark", reversed the District Court on

the issue of likelihood of confusion, and stated:

Yet in spite of the mark’s incontestability, the

District Court reasoned that CLASSIC is a merely

descriptive term and therefore a weak mark deserv-

ing "little if any protection"... Permitting Thomas to

relitigate the original strength or weakness of the

mark was afoul of Park ’N Fly’s requirement the

courts give full effect to incontestable trademarks.

Therefore, while the strength of plaintiff's mark will

still be at issue in cases involving contestable marks,

once a mark has been registered for five years the

mark must be considered strong and worthy of full

protection.

In Clamp Manufacturing Company, Inc. v. Enco

Manufacturing, 870 F.2d 512, 513 (1989), when analyzing

likelihood of confusion, the Ninth Circuit Court of Appeals

held:

Because the Kant-Twist mark is incontestable Enco

may not defend against an infringement action on

the basis that the mark is merely descriptive.®

In Beer Nuts, Inc. v. Clover Club Foods Company, 805

F.2d 920, 924 (1986) the Tenth Circuit, when considering

the likelihood of confusion between the incontestable mark

"Beer Nuts” versus the mark "Brew Nuts" held:

Once a mark has become incontestable, its registra-

tion constitutes "conclusive evidence" of the holders’

rights to use the mark [footnote omitted]... An "in-

contestable" mark cannot be challenged as lacking

secondary meaning; such marks are conclusively pre-

sumed to be nondescriptive or to have acquired

secondary meaning [citing Park ’N Fly and Union

Carbide)...

.. hus, even if the words BEER NUTS can be

considered descriptive of the product the BEER

NUTS mark is presumed to have secondary mean-

ing; the mark identifies to consumers the source of

the product. It cannot now be challenged as descrip-

tive...

In Beer Nuts the District Court, like the District Court in

this case, engaged in a lengthy analysis of whether the

marks identified the source or use of the products. There,

like here,

[T]hat inquiry was inappropriate because the legal

status of the marks had already been determined.

6 The case involved the mark "Kant-Twist" versus

the mark "No-Twist.”

—EEE——

This failure to base its analysis on the proper legal

standard regarding the scope of protection afforded

the BEER NUTS mark led the district court to

reach erroneous factual conclusions regarding likeli-

hood of confusion. 805 F.2d at 925

The most recent Circuit Court decision on this issue

is believed to be Dieter v. B&H Industries of Southwest

Florida, inc., 880 F.2d 322 (11th Cir. 1989) which held that

incontestabie status is a factor to be taken into con-

sideration in a likelihood of confusion analysis.

Because Dieter’s mark is incontestable, then it is

presumed to be at least descriptive with secondary

meaning and therefore a relatively strong mark. Ac-

cordingly, the district court’s conclusion that Dieter’s

mark was merely descriptive and not entitled to

strong protection is REVERSED and the action is

REMANDED... ’

As the Solicitor Genera! notes in the amicus curiae

brief submitted by the United States in connection with the

petition for certiorari in B&H Industries of Southwest

Florida, Inc. v. Richard H. Dieter et al., No. 89-1193, now

before this Court, the question of the level of strength to be

accorded incontestable trademarks in a likelihood of

’ The Dieter case expressly declined to follow the

decision of Source Services Corp. v. Chicagoland Jobsource,

Inc., 643 F. Supp. 1523 (N.D.IL 1986) which was relied on

by the District Court in the present case for its ruling,

affirmed by the Seventh Circuit, that incontestability does

not settle the issue of strength of a mark in a likelihood

of confusion analysis.

confusion analysis has divided the Circuit Courts of Appeals

as demonstrated by this case, Wynn Oil, and Dieter. Thus

the Solicitor General has recommended further review of

this issue by this Court.

Viewed against this background, it is essential that

the clear conflict among the Circuits be resolved by this

Court. This is particularly so in view of the national

character of businesses protected by the Lanham Act.

The direct conflict among the Circuits with regard to

incontestability should be resolved by this Court because the

conflict, and the decision below, frustrates the purpose of

the Lanham Act and creates intolerable inconsistencies in

the conduct of business by those subject to federal trade-

mark protection.

The Seventh Circuit’s Interpretation Of The

Incontestability Provision Of The Lanham Act

Is An Incorrect Application Of Federal Law

In addition to the grounds argued above, this Court

should grant certiorari in this action to correct the Seventh

Circuit’s incorrect interpretation and application of federal

law.

In passing the Lanham Act Congress intended "to

unify trademark law on a national basis.". Union Carbide

Corp. v. Ever-Ready, Inc., supra, 531 F.2d 366, 376 (7th Cir.)

cert. denied, 429 U.S. 830 (1976). Moreover, its purpose

§ This conflict in the Circuits has also been noted by

at least one professional journal reporting on the Seventh

Circuit decision in this case. Patent, Trademark & Copy-

right Journal, BNA, Vol. 40, No. 993, pp. 326-327.

— |

included the provision of substantive as well as procedural

protection. The Senate Committee Report on the Act

describes the purpose this way:

There can be no doubt under the recent decisions of

the Supreme Court of the constitutionality of a na-

tional act giving substantive as distinguished from

merely procedural rights in trade-marks in com-

merce over which Congress has plenary power...a

sound public policy requires that trade-marks should

receive nationally the greatest protection that can be

given. Sen. Rep. No. 1333, 79th Cong., 2d Sess.

(1946), U.S. Code Cong. Serv. 1946, p. 1277.

Union Carbide v. Ever-Ready, supra, 531 F.2d at 376.

As provided by this legislative history of the Lanham

Act, the Act is the effort of Congress to make a uniform

federal law of trademarks. The opinion below threatens this

uniformity with the defensive/offensive dichotomy and the

allowance of extra-statutory defenses to infringement actions

based on incontestable marks.

In enacting §1115(b) of the Lanham Act, Congress

provided that a registrant had the exclusive right to use its

registered mark once that mark had become incontestable

within the meaning of §1065. Congress then limited the de-

fenses which may be mounted against an incontestable mark

to the seven defenses enumerated in §1115(b). Nothing in

the statute states or even implies that a registrant has an

exclusive right only to defend the validity of its mark through

the use of its incontestability status. As described above,

the Seventh Circuit has judicially engrafted a contrary

interpretation onto the Lanham Act. As a result of that

decision, a registrant would be deprived of the right to use

its incontestable mark exclusively even though the Lanham

Act provides for such exclusive use.

As this Court stated in Park ’N Fly v. Dollar Park

and Fiy, Inc., supra, 469 US. at 194,

Statutory construction must begin with the language

employed by Congress and the assumption that the

ordinary meaning of that language accurately ex-

presses the legislative purpose.

Thus, if the statutory language is unambiguous, in the

absence of "a clearly expressed legislative intent to the

contrary, that language must ordinarily be regarded as

conclusive." Consumer Product Safety Commission v. GTE

Sylvania, Inc., 447 U.S. 102, 108, 100 S. Ct. 2051, 2056

(1980). See, also, United States v. Turkette, 452 U.S. 576, 101

S. Ct. 2524 (1981).

In the present case, the interpretation and applica-

tion of 15 U.S.C. §1115(b) adopted by the Seventh Circuit

engrafts on the statute a defense to infringement of an

incontestable mark the fact that the mark is descriptive, but

no such defense is enumerated among the defenses stated

in plain and clear language by Congress in the statute. In

fact, this Court has noted that the very defense which the

Seventh Circuit’s decision engrafts on the statute was

considered by Congress and not adopted. Park ’N Fh, Inc.

v. Dollar Park and Fly, Inc., supra, 469 U.S. at 201 citing

Hearings on S. 895 before the Subcommittee of the Senate

Committee on Patents, 77th Cong., 2d Sess., 42, 45, 47

(1942). "Instead, Congress expressly provided in §§33(b)

and 15 [15 U.S.C. §§1115(b) and 1065] that an incontestable

mark could be challenged on specific grounds, and the

grounds identified by Congress do not include mere descrip-

tiveness.". Park ’N Fly, Inc. v. Dollar Park and Fty, Inc.,

supra, 469 U.S. at 201. Moreover, there simply is no indica-

tion that Congress intended to establish any further defens-

es than the seven listed in §1115(b) with which to defend an

infringement action. See, e.g., Soweco, Inc. v. Shell Oil Co.,

supra, 617 F.2d 1178 (Sth Cir. 1980); Union Carbide Corp. v.

Ever-Ready, Inc., supra, 531 F.2d 366 (7th Cir. 1976); John

R Thompson Co. v. Holloway, 366 F.2d 198 (Sth Cir. 1966).

By interpreting the Lanham Act in a way which

engrafts such a limitation on the incontestability rights of a

trademark owner the Seventh Circuit adopts an interpreta-

tion that is contrary to the plain language of the statute,

threatens the integrity of federal trademark law, and dilutes

the rights of registrants thereunder.

This Court should correct the error.

The Seventh Circuit’s Interpretation Of The

"Fair Use" Provision Of The Lanham Act Is An

Incorrect Application Of Federal Law

In adopting the Lanham Act, Congress saw fit to

insure that the incontestable status granted a descriptive

mark under the statute does not allow a registrant to

withdraw the word from the English language. Thus

Congress provided in the Lanham Act, at 15 U.S.C.

§1115(b)(4), for the "fair use" of such descriptive words,

despite their incontestable status. By that provision, a

junior user of a mark is entitled to use a descriptive English

word in good faith in its primary descriptive sense. Aber-

crombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4 (2d

Cir. 1976).

The District Court here concluded that Matsui is

entitled toa “fair use" defense under 15 U.S.C. §1115(b)(4)

because Matsui uses "HONE YCOMB" merely to describe its

desiccant wheel and not as a trademark. That decision was

affirmed without comment by the Seventh Circuit. Both of

these conclusions are demonstrably wrong.

As noted above, Matsui used the mark "HONEY-

COMB" in several ways (supra, p. 14)

First, as appears from Example 2a above (p. 14),

that use is not "merely to describe its desiccant wheel" but

refers to Matsui’s entire dehumidification system. Thus, the

District Court’s finding to the contrary (A-30) was clearly

erroneous and should have been reversed by the Court of

Appeals.

Secondly, the uses in Examples 1 and 2b (p. 14)

constitute repetitive, capitalized uses which serve 1) to em-

phasize the word, 2) to call attention to it, 3) to create an

association in the public mind relating to Matsui’s “rotor”

with Matsui, 4) to create the idea in the mind of the public

that Matsui was the source of dehumidifier equipment that

had a unique rotor known as the "HONEYCOMB" rotor, 5)

to create a demand by the public for Matsui dehumidifiers

that used or included a "HONEYCOMB ROTOR’, 6) to

convey to the consumer that Matsui’s product was desirable

to have and 7) to create commercial magnetism by use of

the mark as an easy symbol for the consumer to remember.

These are all "attention-getting" indicia of trademark use,

not descriptive use.’

Before the Lanham Act provided an express defini-

tion of a trademark, this Court, in a famous passage by

Justice Frankfurter, in Mishawaka Rubber & Woolen

Manufacturing Co. v. S.S. Kresge Co., 316 U.S. 203, 205

(1942), defined it as follows:

The protection of trademarks is the law’s recogni-

tion of the psychological function of symbols. If it is

true that we live by symbols, it is not less true that

we purchase goods by them. A trademark is a

merchandising short-cut which induces a purchaser

to select what he wants, or what he has been led to

believe he wants. The owner of a mark exploits this

human propensity by making every effort to im-

pregnate the atmosphere of the market with the

drawing power of a congenial symbol. Whatever the

means employed, the aim is the same - to convey

through the mark, in the minds of potential cus-

tomers, the desirability of the commodity upon

which it appears. Once this is attained, the trade-

mark owner has something of value. If another

poaches upon the commercial magnetism of the

symbol he has created, the owner can obtain legal

redress.

% Cf, Mobil Oil Corp. v. Mobile Mechanics, Inc., 192

U.S.P.Q. 744 (D. Conn. 1976) wherein the use of MO-

BILE MECHANICS was not a “fair use" of plaintiff's

mark MOBIL.

The "aim" of a trademark defined by Justice Frankfurter is

precisely the same attention-getting "aim" by Matsui in using

"HONEYCOMB" in its ads. However, the District Court

below concluded (A-30) that such use was not a use "as a

trademark" and that conclusion was affirmed by the Seventh

Circuit.

This Court has not previously addressed the inter-

pretation of the “fair use" provision of the Lanham Act 15

U.S.C. §1115(b)(4). More specifically it has not instructed

the Circuits as to the parameters of the phrase "is a use,

otherwise than as a mark" in that section of the statute.

The question of what is or is not a "mark" would

seem to have been answered directly by the Lanham Act

itself in 15 U.S.C. §1127 which states:

The term "trademark" includes any word, name,

* symbol, or device or any combination thercof adopt-

ed and used by a manufacturer or merchant to

identify and distinguish his goods, including a unique

product, from those manufactured or sold by others

and to indicate the source of the goods, even if that

source is unknown,

However, the Seventh Circuit by affirming the District

Court below does not follow this plain language definition

in the application of the "fair use" defense of 15 U.S.C.

§$1115(b)(4). The District Court, and by its affirmance the

Seventh Circuit, held that Matsui’s uses of Examples 1, 2a

and 2b above, p. 14, were not trademark uses yet those uses

appear - on their face - to be the use of a word to identify

and distinguish Matsui’s product from those of others, i.e.

precisely the kinds of uses encompassed within the statutory

definition of a "trademark." While the District Court held

(A-30) that"'HONEYCOMB* in these uses does not identify

or distinguish Matsui’s product, the issue as framed by the

plain language of this section of the statute is whether the

word is used for that purpose - not whether the purpose of

the use has been successfully acomplished.’® Thus the

interpretation and application of the statute in this regard

by the Courts below was contrary to the plain meaning of

the statutory language.

While the determination of what is or is not "fair

use" of an incontestable descriptive mark has been consid-

ered by various Circuits, the decisions are sui generis and

provide no firm guidance as to how this section of the

statute is to be interpreted or applied.

For example, in Venetianaire Corp.v. A&P Import Co.,

429 F.2d 1079 (2d Cir. 1970), the Court held that the

prominent use of plaintiff's registered trademark "Hygienic"

as a purported description on the packaging of the defend-

ant’s mattress covers was not “fair use." Jd. at 1081.

In the Seventh Circuit, in Snap-On Tools Corp. v.

Winkenweder & Ladd, Inc., 150 F. Supp. 792 (N.D. Ill., 1956)

affd, 250 F.2d 154 (7th Cir. 1957) it was held that the

trademark "Snap-On" was demonsirated as having acquired

a secondary meaning for tools and cabinets and defendant’s

use of "Snap-On Drawer" was enjoined. Yet in the present

case Matsui’s use of "HONEYCOMB ROTOR," a use

unclean hands Matsui’s use of honeycomb in a descriptive

sentence as in Example 2c (p. 14) would qualify as a “fair

use."

essentially identical to Munters’ use of "HONEYCOMBE

WHEEL,” was deemed a fair use. This is despite the fact

that in a similar situation involving the mark "Chocolate

Fudge” the Seventh Circuit held that where a defendant’s

use was exactly the type of use the trademark owner was

attempting to protect, it could "only conclude that it must be

a clear infringement” and stated, "if this isn’t infringement

what is.” A.J. Canfield Co. v. Vess Beverages, 796 F.2d 903,

908 (7th Cir. 1986).

In view of this background and the failure of both

the District Court and the Seventh Circuit to apply the

statutory definition of a trademark in deciding the fair use

issue - and since this Court has not decided this important

question of federal law - this Court should review the deci-

sion below on the fair use issue in conjunction with its

review of the effect of "incontestability” under the Lanham

Act. In doing so the Court should establish clear guidelines

for the application of the "fair use" defense and correct the

error made below.

CONCLUSION

For the foregoing reasons, petitioner respectfully

requests that this Court grant the Writ of Certiorari.

Respectfully submitted,

Pasquale A. Razzano

Counsel of Record

Curtis, Morris & Safford, P.C.

530 Fifth Avenue

New York, New York 10036

(212) 840-3333.

DATED: October 4, 1990

APPENDIX

In the

United States Court of Appeals

For the Seventh Circuit

Nos. 89-3553 and 89-3646

MUNTERS CORPORATION,

Plaintiff-Appellant,

Cross-Appellee,

MATSUI AMERICA, INCORPORATED,

Defendant-Appellee,

Cross-Appellant.

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 89 C 3782—James B. Zagel, Judge.

ARGUED JUNE 13, 1990—DeEcipEpD AucGusT 2, 1990

Before CUMMINGS, COFFEY and RIPPLE, Circuit Judges.

PER CURIAM. Plaintiff, the Munters Corporation (“Mun-

ters’’), manufactures and sells industrial and environmental

control devices including a dehumidifying apparatus. Defen-

dant Matsui America, Incorporated (‘“‘Matsui”) is a wholly

owned subsidiary of a Japanese corporation. Matsui manu-

factures and distributes equipment for the plastics industry

in the United States, including dehumidifiers for drying

plastic resins.

2 Nos. 89-3553 & 89-3646

In May 1989, Munters filed a suit against Matsui for

trademark infringement and unfair competition. The com-

plaint showed that Munters, through a subsidiary, had

registered the trademark “HONEYCOMBE” and used

that trademark on its space dehumidifying apparatus con-

taining a honeycomb-shaped desiccant whee] rotor.

In the fall of 1987, Munters learned that Matsui was

selling a ‘“Honeycomb Dehumidifying Unit,” which also

contained a honeycomb-shaped desiccant wheel rotor. This

caused counsel for Munters to advise Matsui to stop using

“‘Honeycomb” in connection with its dehumidifiers. As a

result, Matsui allegedly agreed to discontinue the use of

that term as a trademark in its advertising materials. After

its stock of brochures was exhausted, Matsui continued

to use the word honeycomb, but only as an adjective to

describe its rotor.

Besides charging Matsui with infringement of its regis-

tered trademark, Munters’ complaint contained seven other

counts not involved on this appeal. In its answer, Matsui

denied continuing the use of the word honeycomb as a

trademark in connection with its dehumidifiers and claimed

that its products were sold through different channels of

distribution to different classes of customers and for dif-

ferent purposes.

In June 1989, the district court granted a preliminary

injunction restraining Matsui from infringing on Munters’

trademark ‘“HONEYCOMBE” in connection with the sale

of its dehumidifiers. However, after holding an August

1989 hearing to determine whether Munters was entitled

to a permanent injunction, the district court determined on

October 25, 1989, that the injunction was not warranted.

The court’s judgment was accompanied by a comprehen-

sive 13-page memorandum opinion reported at 703 F.Supp.

790. We agree with Judge Zagel’s reasoning and therefore

hold that a permanent injunction was properly denied.

Only one issue merits elaboration. Munters has argued

that the district court’s analysis of the strength of its

mark is in derogation of the Supreme Court’s holding in

Nos. 89-3553 & 89-3646 3

Park ’N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S.

189. Park ’N Fly holds that an alleged infringement of an

incontestable trademark cannot be defended on the ground

that the complainant’s mark is merely descriptive. A bit of

background is necessary to an understanding of Munters’

argument.

In order to prevail in an action under Section 43(a) of

the Lanham Act, a complainant must show that it has a

protectible trademark and that the alleged infringer’s use

of that trademark is likely to cause confusion among con-

sumers. The Forum Corporation of North America v. The

Forum, Ltd., 903 F.2d 434, 439 (7th Cir. 1990); Interna-

tional Kennel Club v. Mighty Star, Inc., 846 F. 2d 1079,

1084 (7th Cir. 1988). Most often an analysis of the strength

of the complainant’s mark is undertaken to determine

whether an unregistered trademark is protectible. See,

e.g., G. Heileman Brewing Co. v. Anheuser-Busch, Inc.,

873 F.2d 985 (7th Cir. 1989). Here Munters’ ‘“HONEY-

COMBE” trademark was registered. The district court

accordingly found that it was protectible and, because it

had been in continuous use for more than five years fol-

lowing its registration, incontestable. Nevertheless, the

district court undertook a strength of the mark analysis

in evaluating whether Matsui’s use of Munters’ mark was

likely to cause confusion. This is correct practice in the

Seventh Circuit, since strength of the mark is one of the

factors in this Circuit for evaluating likelihood of confu-

sion. See, e.g., McGraw-Edison Co. v. Walt Disney Pro-

ductions, 787 F.2d 1163 (7th Cir. 1986) (applying seven

factors including strength of the mark). Some other cir-

cuits do not include this factor in their likelihood of con-

fusion analysis. See, e.g., Clamp Manufacturing Co., Inc.

v. Enco Manufacturing Co., Inc., 870 F.2d 512, 517 (9th

Cir. 1989) (strength of mark not among listed factors), cer-

tiorari denied, 110 S.Ct. 202; Beer Nuts, Inc. v. Clover

Club Foods Co., 805 F.2d 920, 925 (10th Cir. 1986) (same).

Munters has argued that since a strength of the mark anal-

ysis includes a discussion of whether the mark is merely

descriptive, the district court’s discussion of the strength

inane encanta

4 Nos. 89-3553 & 89-3646

of Munters’ mark disregarded the Supreme Court’s hold-

ing in Park ’N Fly that an incontestable mark cannot be

challenged on the grounds that it is merely descriptive.

This argument is unpersuasive. The most that can be

said by critics is that this Circuit’s practice of including

a strength of the mark component in its likelihood of con-

fusion analysis is a practice that is, itself, likely to cause

confusion. We conclude, however, that it is Munters, and

not the district court, that is confused in this case. The

district court explicitly noted that Matsui’s argument that

Munters’ mark was merely descriptive was not intended

to demonstrate that Munters’ mark was not protectible

but rather was advanced solely to bolster Matsui’s claim

that there was no likelihood of confusion. 730 F. Supp.

at 795-796. The Supreme Court’s holding in Park ’N Fly

does not address likelihood of confusion. In fact the Court

specifically directed the district court to consider the like-

lihood of confusion argument on remand. 469 U.S. at 205.

Therefore Park ’N Fly does not preclude consideration

of a mark’s strength for purposes of determining the like-

lihood of confusion.

The district court’s findings as to likelihood of confusion

are findings of fact subject to the clearly erroneous stan-

dard of review. The Forum Corporation, 903 F.2d at 438;

Henri’s Food Products Co., Inc. v. Kraft, Inc., 717 F.2d

352, 354 (7th Cir. 1983). We agree with the district court

that Matsui’s present use of the word honeycomb is not

likely to cause confusion among current or potential pur-

chasers of Matsui’s and Munters’ products.

After denying Munters’ motion for a permanent injunction,

the district court denied Matsui’s motion to amend its an-

swer and counterclaim to challenge the registration status of

Munters’ trademark on the ground that “HONEYCOMBE”

was a generic term that could not become a trademark.

As Judge Zagel] explained, the mark does not denominate

a type of goods nor classify the noun “‘dehumidifier” or

“wheel” to which it is attached by Munters. Instead the

term describes the porous configuration of the goods and

Nos. 89-3553 & 89-3646 5

not a subcategory of wheel or dehumidifier. See 730 F.

Supp. at 796. Furthermore, as Matsui admits in its reply

brief, the district court gave Matsui the opportunity at

trial to present evidence that Munters’ mark was generic.

Reply Brief at 3, 4. More was not required.

The judgment of the district court is affirmed. Matsui’s

motion for sanctions under Rule 38 of the Federal Rules

of Appellate Procedure is denied.

A true Copy:

Teste:

Clerk of the United States Court of

Appeals for the Seventh Circuit

USCA 79004—Midwest Law Printing Co., Inc., Chicago—8-2-90—500

A-6

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

THE MUNTERS CORPORATION )

)

Plaintiff, )

)

v. ) No. 89 C 3782

)

MATSUI AMERICA, )

INCORPORATED, ) HON.

) JAMES B. ZAGEL

)

Defendant. )

MEMORANDUM OPINION AND ORDER

I. INTRODUCTION

In this action the plaintiff, The Munters Corporation

("Munters") has brought suit charging the defendant, Matsui

America, Inc. ("Matsui") with: 1) infringement of the

plaintiff's registered trademark under sec. 32(1) of the

Trademark Act of 1946 ("Lanham Act"), 15 U.S.C. sec.

1114(1); 2) use of a false designation of origin under sec.

43(a) of the Lanham Act, 15 U.S.C. sec. 1125(a); 3) com-

mon law trademark infringement; 4) violation of the Illinois

Uniform Deceptive Trade Practice Act; 5) violation of the

Illinois Consumer Fraud and Deceptive Business Practices

Act; 6) trademark dilution under the Illinois Anti-Dilution

statute; 7) common law unfair competition; and 8) breach

of contract. The defendant filed a counterclaim alleging

that it had not violated any rights of plaintiff. The defen-

dant also filed a motion to amend its counterclaim in order

to seek cancellation of the plaintiff's trademark registration.

On June 29, 1989, we granted the plaintiff's motion

for preliminary injunction. On August 31, 1989, this Court

held a hearing to determine whether the plaintiff was

entitled to a permanent injunction. For the following

reasons, the plaintiffs motion is denied.

II. FACTS

The plaintiff, Munters, is a Delaware corporation

with its headquarters in Florida. Munters operates a

division, Cargocarie Engineering Corporation

("Cargocaire"), located in Massachusetts. Cargocaire was

originally a separate and independent company that

Munters’ parent company, Carl Munters AB of Sweden,

acquired in 1978. In November 1987, Munters and

Cargocaire merged. Munters, through Cargocaire, manufac-

tures and sells industrial environmental control apparatus,

such as heating, ventilation,and cooling equipment, including

a dehumidifyng apparatus. Munters’ products are general

purpose dehumidifiers, and no single model is designed

specifically for the plastics industry. However, Munters’

dryers have been used in the plastics industry, primarily in

the drying of plastics molds and the drying of mold rooms.

All Munters’ dehumidifying apparatus contain a wheel rotor,

which is a porous, extended-surface cylinder composed of

desiccant material. The desiccant absorbs moisture in air

passed through the channels formed in the rotor, as the

wheel slowly rotates.

The defendant, Matsui, is a wholly-owned subsidiary

of Matsui Manufacturing Company, Ltd. ("Matsui Mfg."), a

Japanese corporation. Matsui is an Illinois corporation with

its headquarters in Elk Grove Village, Illinois. Matsui

manufactures and distributes equipment exclusively for the

plastics industry in the United States, including pneumatic

conveyors, hopper loaders, hot air hopper dryers and

dehumidifiers, mold temperature controllers, mold chillers,

and material mixers and blenders. Plastics manufacturers

use Matsui’s dehumidifying equipment prior to processing

to dry hydroscopic resin material stored in a hopper.

Before the manufacturer melts and injects the plastic resin

material into the molding press, Matsui’s dehumidifier dries

the plastic granules. Matsui’s equipment contains a desic-

cant wheel composed of ceramic paper whose purpose is

similar to the rotor in Munters’ space dehumidifier. Unlike

Munters’ equipment, Matsui does not design any of its

equipment for space dehumidification. Rather, Matsui’s

dehumidifier has a specific application: drying plastic resin.

On the other hand, Munters does not manufacture or

distribute a dehumidifying dryer for drying plastic resin. We

find that Munters’ and Matsui’s respective dehumidifiers are

not interchangeable and are not competitive for the purpose

of plastic resin drying.

A typical plastic injection molding facility consists of

large storage silos at the plant that the manfuacturer fills

with the plastic resins prior to processing. A pneumatic

conveying device transports the plastic resin from trucks and

rail cars into the silos. From the silos, the resin proceeds to

indoor storage tanks and then to mixers, where other

materials may be added to the resin. If then required, a

dryer removes any moisture from the resin. The resin is

then conveyed to the injection molding machines, where the

resin is readied for injection into the molds. Matsui

distributes the storage silos, storage tanks, and the plastic

resins conveying drying and mixing equipment. Munters

does not manufacture or distribute any of the products

distributed by Matsui.

Munters received a trademark registration of

"HoneyCombe" for a "dehumidifying apparatus" on October

10, 1961 and renewed its registration by October 10, 1981.

Munters’ position is that the trademark applies to both its

dehumidifier ("HoneyCombe dehumidifier") and to its

desiccant wheels ("HoneyCombe wheels or rotors").

Munters places "HoneyCombe" on all its products that

contain, and all its advertising literature that promote, the

desiccant wheel. Munters also displays the "Cargocaire" or

"Munters" name and logo on all its advertising literature.

Prior to an agreement signed in May 1988 by

Munters and Matsui, Matsui referred to its plastic resin

dehumidifier as the "Honeycomb DMZ Dehume Jet Dryer."

Pursuant to its understanding of the agreement, Matsui

ceased referring to its plastic resin dehumidifier as "Honey-

comb" in its promotional literature. However, Matsui

continued to describe the desiccant wheel within its resin

dehumidifier as honeycomb-shaped.

Munters’ dehumidifiers range in price from $1,695

to almost $150,000. Matsui’s resin dryers range in price

from $5,000 to $50,000. The majority of Matsui’s sales are

of systems of more than ##@ component. Both Munters and

Matsui market their products through independent sales

representatives. The evidence demonstrates that Matsui

and Munters have no sales representatives in common. In

A-10

addition, Munters’ sales representatives sell to general

contractors, and Matsui’s sales representatives sell directly

to buyers with technical backgrounds. We flatly reject

plaintiff's suggested inference that because general contrac-

tors are “nontechnical people" they are unsophisticated

buyers. As Matsui demonstrates, and Munters’ director of

Technology concedes, a buyer either will need a technical

background or will need the assistance of someone with a

technical background to understand the technical advertising

literature in which Matsui describes its desiccant wheel as

honeycomb-shaped and from which this lawsuit arose. The

conclusion is inevitable that either a technically sophisticat-

ed purchaser, or at least a technically sophisticated assistant,

will review Matsui’s advertisements.

One of the plaintiffs witnesses noted that approxi-

mately 75,000 plastic-molding machines are spread among

some 10,000 to 15,000 plastic molding plants in the United

States. Of these plants, Munters could point to only one

that contained both a Matsui plastic resin dryer and a

Munters space dehumidifier.

Matsui has four main competitors: 1) Conair,

Franklin Group; 2) AEC-Whitlock; 3) Universal Dynamics;

and 4) Pacific Engineering, Novatec. These four competi-

tors all carry the same product lines as Matsui, including

resin dryers. Matsui and most of its competitors belong to

the Society of Plastics Industry (SPI), an organization that

promotes the use of plastics among consumers in the United

States. The main requirement for membership is that a

member must sell plastic machinery or materials or be a

processor of plastic in the United States. Munters is not a

member of SPI. In fact, Munters’ Director of Technology

stated that he did not know what the SPI was.

Matsui promotes its products through its sales

representatives, through magazine advertisements, and

through regional and national trade shows that it attends.

Matsui has placed advertisements in three out of four of the

major publications in the plastics industry and presents

exhibits at national and regional trade shows.

Munters primarily directs its advertising to the

heating and ventilation industry, a distinct industry from the

plastics processing equipment industry. Munters advertises

"HoneyCombe" products in various trade journals. Howev-

er, Munters limits its promotion in the plastics industry to

distribution of an application note, which explains how to

prevent sweat on a chilled mold. Uncontroverted evidence

shows that until December 9, 1987 Matsui had never heard

of Munters or Cargocaire and was not aware that "HoneyC-

ombe" was a registered trademark. By letter dated Decem-

ber 7, 1987 Munters’ counsel advised Matsui of Munters’

objection to Matsui’s trademark use of "Honeycomb." The

letter demanded that Matsui “cease and desist from all

further uses of the term HONEYCOMB.” After a period

of negotiations, Mr. G. Gondoh, Matsui’s Vice President,

signed a May 26, 1988 letter from Munters’ attorneys with

the legend: "Subject to the terms of the May 2, 1988 letter,

Matsui America, Inc. agrees that it will no longer use

‘HONEYCOMB as a trademark after November 1, 1988."

In the referenced May 2, 1988 letter, Matsui’s counsel

proposed that:

without any waiver of rights which MATSUI AME-

RICA, INC. has to use the subject words generally

.. MATSUI AMERICA, INC. is willing to discontin-

ue the use of the word HONEYCOMB in its adver-

tising materials ....

A-12

Pursuant to the May 1988 agreement, Matsui changed the

name of its resin dryer from "Honeycomb DMZ Dehume

Jet Dehumidifying Hot Air Dryer" to "DMZ Dehume Jet

Dehumidifying Hot Air Dryer", removed the word "Honey-

comb" from its products, and depleted its supply of product

brochures for the "Honeycomb DMZ Dehume Jet Dehumid-

ifying Hot Air Dryer." Matsui continued to use the word

"honeycomb" as an adjective to describe its rotor in its

advertising literature.

The most common definition of "honeycomb" is "a

mass of hexagonal prismatic wax cells ... built by honeybees

in their nest or hive to contain their brood and stores of

honey.” Webster’s Third New Int'l Dictionary. As a noun,

"honeycomb" is also "something that resembles a honeycomb

in structure or appearance”, id., such as "a weave with a

small allover pattern of raised squares, oblongs, or dia-

monds.” Id. As a transitive verb, "honeycomb" means "to

cause to be full of cavities like a honeycomb [; to] make into

a tissue of holes separated by thin walls or partitions.” Id.

"Honeycomb" may also be used as an adjective, such as in

"honeycomb coral" and "honeycomb sponge.” Id. Cargoc-

aire, in fact, used the word "honeycomb" in its book, "The

Dehumidification Handbook", to describe the appearance of

its desiccant wheel: "The rotary "HoneyCombe unit func-

tions in the same fashion as the rotary bed dehumidifier

except that an absorbent (usually lithium chloride) is used,

and the desiccant is impregnated into a honeycomb struc-

ture mounted within a cylindrical casing.”

Munters presented no evidence of actual confusion

on the part of Munters’ customers or potential customers.

Munters has not received any misdirected mail that was

intended for Matsui and came to Cargocaire or Munters.

A-13

Munters has never received a telephone call inquiry indicat-

ing confusion from a customer regarding the source of

Munters’ or Matsui’s honeycomb rotor. Also, Matsui has

not received any misdirected mail that was addressed to

Cargocaire or any telephone inquiries indicating any type of

confusion.

III. DISCUSSION

This court has subject matter jurisdiction of the

complaint and the counterclaim pursuant to 15 U.S.C. secs.

1114, 1116-1119, 1121, and 1125(a), 28 U.S.C. secs. 1331,

1332(a), and 1338(b). This court has personal jurisdiction

over the parties. Venue is proper herein under 28 U.S.C.

sec. 1391(b) and (c).

A. Trademark Infringement

A cause of federal trademark infringement exists

where a person uses 1) any reproduction, counterfeit, copy

or colorable imitation of a mark; 2) without the registrant’s

consent; 3) in commerce; 4) in connection with the sale,

offering for sale, distribution or advertising of any goods; 5)

where such use is likely to cause confusion, or to cause

mistake or to deceive. Lanham Act sec. 32(1) (15 U.S.C.

sec. 1114(1)). See James Burrough Ltd. v. Sign of Beefeat-

er, Inc., 540 F.2d 266, 273-74 (7th Cir. 1976).

A cause of action under sec. 43(a) of the Lanham

Act exists in the following situation:

Any person who shall affix, apply, or annex, or use

in connection with any goods or services ... a false

designation of origin, or any false description or

representation including words or other symbols

A-14

tending falsely to describe or represent the same,

and shall cause such goods or services to enter into

commerce ... shall be liable to a civil action ... by any

person who believes that he is or is likely to be-

damaged by the use of any such false description or

representation.

15 U.S.C. sec. 1125(a).

1. Likelihood of Confusion

The crucial issue in this unfair competition and

trademark infringement action based on secs. 32(1) and

43(a) of the Lanham Act and on common law is the

likelihood of confusion on the part of the consuming public.

G. Heileman Brewing Co. v. Anheuser-Busch, Inc., 873

F.2d 985, 999 (7th Cir. 1989); Henri’s Food Products Co.

Inc. v. Kraft, Inc., 717 F.2d 352, 354 (7th Cir. 1983). To

determine whether a likelihood of confusion exists, the

Seventh Circuit considers a number of factors, including:

1) the similarity of the marks;

2) the distinctiveness (or strength) of the marks

in issue;

3) the similarity of the products;

4) the degree of care likely to be exercised by

consumers;

5) the similarity of the channels of distribution;

6) the intent of the claimed infringer; and

7) the evidence of actual confusion.

International Kennel Club v. Mighty Star, Inc., 846 F.2d

1079, 1087 (7th Cir. 1988); Ziebart Int’l Corp. v. After

Market Assocs., 802 F.2d 220, 226 (7th Cir. 1986); McGraw-

Edison Co. v. Walt Disney Productions, 787 F.2d 1163,

A-15

1167-68 (7th Cir. 1986); Henri’s Food Products, 717 F.2d at

354; Wesley- Jessen Div. of Schering Corp. v. Bausch &

Lomb Inc., 698 F.2d 862, 867 (7th Cir. 1983). "None of

these factors by itself is dispositive of the likelihood of

confusion question, and different factors will weigh more

heavily from case to case depending on the particular facts

and circumstances involved.” International Kennel Club, 846

F.2d at 1087; Schwi icycle Co. v. Ross Bicycles, Inc., 870

F.2d 1176, 1187 n.20 (7th Cir. 1989) ("the importance of any

single factor may vary between cases"); McGraw-Edison, 787

F.2d at 1168.

a. The Similarity of the Marks

In considering the similarities and differences betw-

een marks, the marks in their entireties must be compared

1. In Ziebart Int’l, 802 F.2d at 226, the court noted that three

factors were more important than the others, in the case before

it, in determining the likelihood of confusion issue. The court in

G. Heileman Brewing, 873 F.2d 985, relied on the Ziebart Int’l

court’s fact-specific determination in stating the following broad

legal proposition:

While there are a myriad of variables to be

considered in determining whether a likelihood

of confusion exists, the most im ortant factors

include the similarity of the marks, the intent of

the claimed infringers and the evidence of actual

confusion.

G. Heileman Brewing, 873 F.2d at 999 (citing Zi Int'l).

We note only that the outcome of the case before us is

the same whether we weigh the three specified factors in G.

Heileman Brewing more heavily than the others, or whether we

look at the facts before us in order to determine which factors we

will accord more weight.

A-16

in light of what occurs in the marketplace, not in the

courtroom. James Burrough, 540 F.2d at 275. In the

courtroom, "HoneyCombe" and "honeycomb" appear similar:

they are identical in sound and derive from the same word,

"honeycomb."

However, Munters’ mark as used in the marketplace

is different from Matsui’s use of the word "honeycomb."

First, Munters has chosen to misspell the common word

"honeycomb" by adding an "e" and presenting it with a

capitalized "H" and "C." We are mindful that "it is inappro-

priate to focus on minor stylistic differences in defendant’s

use of the allegedly infringing name." International Kennel

Club, 846 F.2d at 1088. However, we do not focus solely on

the difference between Munters’ stylistic spelling of

"HoneyCombe” and Matsui’s nonstylistic use of "honey-

comb.” We also take note that Munters presents its mark

"HoneyCombe" as a brand name for its dehumidifiers in

conjunction with its company name, Munters, and division

name, "Cargocaire.”. By contrast, Matsui does not use

"honeycomb" in its brand name, "DMZ Dehume Jet.”

Matsui only uses the word "honeycomb" in the body of its

advertising literature to describe one product: the rotor

component. "Prominent display of different names on the

marks ... reduce[s] the likelihood of confusion even where

... the marks are otherwise similar.” Ziebart Int’l, 802 F.2d

at 227; McGraw-Edison, 787 F.2d at 1168 (plaintiff and

defendant’s "TRON" marks "distinguishable" because

manufacturer’s name presented with mark).

Based on the evidence before us and considering the

marks in light of what occurs in the marketplace, we find

that the marks are not sufficiently similar to create a

A-17

likelihood of confusion among purchasers as to the source

of Matsui’s products’ origins.

b. The Distinctiveness (or Strength) of Munters’ Mark

Munters’ trademark "HoneyCombe" is registered and

incontestable. The Supreme Court has held that an incon-

testable mark cannot be invalidated in an infringement suit

on the ground that it is merely descriptive. Park ’N Fly, Inc.

v. Dollar Park and Fly, Inc., 105 S. Ct. 658, 667 (1985). For

purposes of determining a mark’s validity, it is conclusively

presumed either that the mark is non-descriptive, or if so,

has acquired secondary meaning. Union Carbide Corp. v.

Ever-Ready Inc., 531 F.2d 366, 377 (7th Cir.), cert. denied,

429 U.S. 830, 97 S. Ct. 91, 50 L.Ed.2d 94 (1976). Matsui

does not challenge the validity of Munters’ mark by arguing

Munters’ mark is merely descriptive. Rather, Matsui argues

that there is no likelihood of confusion because the mark is

merely descriptive. Trademark validity and likelhood of

confusion are distinct issues. See Schwinn Bicycle, 8 7 0

F.2d at 1186-87; Union Carbide, 531 F.2d 366. As such, the

courts in this Circuit hold that "an incontestability finding in

no way concludes the confusion question." Source Services

Corp. v. Chicagoland Jobsource, Inc., 643 F. Supp. 1523,

1532 (N.D. Ill. 1986) (Shadur, J.); Source Services Corp. v.

Source Telecompu‘ing, 635 F. Supp. 600, 610 (N.D. Ill.

1986) (Rovner, J.) ("the conclusive presumption that the

marks [are non-descriptive, or if descriptive,] have second-

ary meaning established by the statutory incontestability of

plaintiffs ... marks does not automatically transfer into a

conclusive presumption of strength in a likelihood of

confusion analysis"). Thus, Munters’ mark’s incontestability

status does not settle the issue of the strength of "HoneyCo-

mbe.” The strength issue "depends on the actual market-

A-18

place facts and cannot be resolved by resting on incontest-

ability." Chicagoland Jobsource, 643 F. Supp. at 1532 (citing

Source Telecomputing, 635 F. Supp. at 610).

The court in G. Heileman Brewing, 873 F.2d at 991,

set forth the analysis for assessing the strength of a mark.

The court stated that "a term for which trademark protec-

tion is claimed generally fits somewhere in the spectrum of

classification ranging from (1) generic or common descrip-

tive and (2) merely descriptive to (3) suggestive and (4)

arbitrary or fanciful." Id. (citing Miller Brewing Co. v. G.

Heileman Brewing Co., 561 F.2d 75, 79 (7th Cir. 1977), cert.

denied, 434 U.S. 1025, 98 S. Ct. 751, 54 L.Ed.2d 772 (1978)).

A generic or common descriptive term is one

which is commonly used as the name or description

of a kind of goods. It cannot become a trademark

under any circumstances...

A merely descriptive term specifically de-

scribes a characteristic or ingredient of an article.

It can, by acquiring a secondary meaning, Le.,

becoming "distinctive of the applicant’s goods" (15

U.S.C. sec. 1052(f)), become a valid trademark.

A suggestive term suggests rather than

describes an ingredient or characteristic of the goods

and requires the observer or listener to use imagina-

tion and perception to determine the nature of the

goods. Such a term can be protected without proof

of a secondary meaning.

An arbitrary or fanciful term enjoys the same

full protection as a suggestive term but is far enough

removed from the merely descriptive not to be

A-19

vulnerable to possible attack as being merely de-

scriptive rather than suggestive.

Miller Brewing, 561 F.2d at 79.

"HoneyCombe" as applied to Munters’ dehumidifier

and desiccant wheel is not a generic term. The mark does

not "serve to denominate a type, a kind, a genus or a

subcategory of goods." Henri’s Food Products, 717 F.2d at

1306. "“HoneyCombe" is not a word "which in any way

serves to classify the noun ["dehumidifier" or "wheel"] to

which it is attached.” Id. Rather, "HoneyCombe" describes

or suggests (see infra) a characteristic--the porous configura-

tion--of the goods. It does not represent a subcategory or

kind of wheel or dehumidifier. See A.J. Canfield Co. v.

Vess Beverages, Inc., 796 F.2d 903, 906 (7th Cir. 1986).

Further, although minor stylistic changes (notably the

addition of an "e” at the end of "HoneyCombe") are not

determinative, we note that these changes push the word

farther from generic status into the realm of trademarks.”

"HoneyCombe" also is not fanciful or arbitrary. The

dictionary definition of "honeycomb" clearly relates to the

porous configuration of Munters’ wheel. "HoneyCombe" is

not far enough removed from the description of one salient

2. This court denies defendant’s motion to amend its answer and

counterclaim, in which Matsui challenges Munters’ use of

"HoneyCombe” as a valid trademark. Specifically, Matsui con-

tends that "HoneyCombe” is a generic term and as such should

no longer be allowed its incontestable status as a registered

trademark. For the stated reasons, we believe Munters’ trade-

mark is not a generic use of the term with respect to its dehumid-

ifier and, therefore, we believe that its trademark is valid.

A-20

feature--the porous configuration--of Munters’ dehumidifier

that we could classify it as fanciful or arbitrary.

Munters’ trademark "HoneyCombe" is registered for

"dehumidifying apparatus." Munters considers both its

desiccant wheel and its dehumidifier covered by this

registration.

The issue then boils down to _ whether

"HoneyCombe" is descriptive or suggestive. A considerable

body of law has developed attempting to distinguish merely

descriptive marks from suggestive marks. Much of this law

is devoted to whether the mark at issue is valid, a question

that a court must answer affirmatively before the court

tackles the second broad element in trademark infringement

cases: whether a likelihood of confusion exists as to the

valid mark. See, e.g., G. Heileman Brewing, 873 F.2d at

996-97. In the validity analysis, a suggestive mark is valid

per se and entitled to protection against infringement. A

descriptive mark is not valid per se and must be accompa-

nied by secondary meaning--an evidentiary demonstration of

recognition of the mark’s strength--to receive protection. A

descriptive mark without secondary meaning is not valid and

not entitled to protection against infringement.

Our slightly different purpose here is to determine

whether in light of the other digits of the likelihood of

confusion test the Munters mark has sufficient strength to

create a likelihood of confusion among the relevant consum-

ing class. To that end, this analysis merely determines

where along the continuum of mark strength "HoneyCombe"

falls.

—_———

A-21

The strength of "HoneyCombe" is different when

applied to Munters’ desiccant wheel than when applied to

its entire dehumidifier. _ "HoneyCombe wheel" and

"HoneyCombe rotor" specifically and directly describe a

characteristic of the desiccant wheel: the wheel’s porous

configuration. We therefore find that as applied to the

desiccant wheel, "HoneyCombe" is merely descriptive. As

the Seventh Circuit stated recently: "A suggestive term, as

the word implies, suggests rather than describes an ingredi-

ent or characteristic of the goods and requires the observer

or listener to use imagination and perception to determine

the nature of the goods.” Id. at 996. A potential purchaser

needs no imagination to associate the word "HoneyCombe",

which means "a tissue of holes separated by thin walls or

partitions", with the rotor’s configuration. The court in

Union Carbide, 531 F.2d at 379, stated that "generally

speaking, if the mark imparts information directly, it is

descriptive. If it stands for an idea which requires some

operation of the imagination to connect it with the goods,

it js suggestive" (quoting A. Seidel, S. Dairoff, and E.

Gonda, Trademark Law and Practice sec. 4.06 at 77 (1963);

see also M.B.H. Enterprises, Inc. v. WOKY, Inc., 633 F.2d

50 (7th Cir. 1980). Also, the word "honeycomb" is used both

inside and outside the plastics industry and dehumidification

industry to describe products consisting of multi-cellular

configurations of various shapes. Munters’ argument that

"honeycomb" is not necessary to describe, nor directly

describes, Matsui’s rotor because the openings are not

hexagonal and do not resemble the honeycomb in a beehive

is too restrictive a reading of the various dictionary defini-

tions of "honeycomb." Under this test we find that Munters’

mark "HoneyCombe", when applied to its desiccant wheel,

is descriptive, and thus relatively weak.

A-22

A descriptive mark’s inherent weakness may be

bolstered by showing the relevant purchasing class recogniz-

es the mark as indicating the source of the mark’s origin,

that is, showing secondary meaning. Munters, however,

introduced little extrinsic evidence demonstrating the

strength of "HoneyCombe." Rather, Muntess relied primari-

ly on its incontestability status. Munters also introduced an

undifferentiated mass of information purportedly indicating

the amount and nature of advertising of the mark, the

length of time the mark has been in use, and the amount of

goods sold under the mark. However, as Matsui demon-

strated, only a very small proportion of Munters’ advertising

figures are attributable to advertising its dehumidifier

directed at the plastics industry, and only a small number of

the demonstrated sales were to the plastics industry. This

minimal circumstantial evidence does little to convince us

that the relevant buyers are aware of Munters’ mark.

Again, we emphasize that our inquiry is not as to Munters’

mark’s validity. Rather, here we only analyze the strength

of "HoneyCombe" as applied to Munters’ desiccant wheels.

As such, Munters’ incontestability status is not conclusive as

to the secondary meaning issue. We find that Munters has

not offered sufficient evidence of recognition of its mark to

make a prima facie case of secondary meaning. We

therefore conclude that Munters’ descriptive mark

"HoneyCombe", as applied to its desiccant wheel, is not

bolstered by any secondary meaning.

"HoneyCombe" is stronger when applied to the

entire dehumidifying unit than when applied to the desic-

cant wheel. A certain amount of imagination is needed to

associate "HoneyCombe" with the dehumidifier itself. Thus

the mark as applied is suggestive. Although the desiccant

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wheel may fairly be described as honeycomb-shaped, the

dehumidifier’s only relationship to "honeycomb" is the

configuration of the wheel. This is not to say Munters’ use

of "HoneyCombe" in connection with the dehumidifier is

arbitrary or fanciful. Rather the mark suggests a character-

istic of the dehumidifier: its wheel configuration. This

finding is of only limited value to the plaintiff here, howev-

er, given Matsui’s use of "honeycomb" is only in connection

with the wheel, not its resin dryer, and given the other

factors herein delineated.

c. The Similarity of the Products

The question with respect to this factor of likelihood

of confusion is whether the products are the kind the

purchasers and users of the goods attribute to a single

source. McGraw-Edison, 787 F.2d at 1169. There is a

direct correlation between product similarity and likelihood

of confusion: “the more closely products are related the

more likely sources may be confused." Union Carbide, 531

F.2d at 382. However, "[t]he fact that the products at issue

may be ‘very different’ is not dispositive of the issue of

similarity of the products in determining the existence of a

likelihood of confusion between products.". Id. In the

spectrum of similarity, the case law has created three

categories of products, listed in order of descending similari-

ty: 1) competitive, 2) noncompetitive but related, and 3)

noncompetitive and nonrelated. A likelihood of confusion

may exist for competitive products and for noncompetitive

but related products.

As a factual! matter, we find that Munters’ dehumidi-

fier and desiccant wheel are not competitive with Matsui’s

resin dryer and desiccant wheel. Despite Munters’ protesta-

A-24

tions to the contrary, the evidence shows that the two

products are not interchangeable and purchasers do not

substitute Munters’ products with Matsui’s products.

Munters’ dehumidifier is designed and used for space

dehumidification. Matsui’s product is considerably more

specialized and is used exclusively for plastic resin drying.

The only evidence that Matsui’s dehumidifier can serve the

same function as Munters’ is one incident in which a

Munters dehumidifier was substantially altered. Aside from

this example, the evidence demonstrates that Matsui’s and

Munters’ products are not interchangeable.

Products need not be directly competitive for a

likelihood of confusion to exist. Consumers may confuse

similar marks on noncompetitive but related goods. In

determining whether Munters’ and Matsui’s products are

related we analyze degree, not kind. In some, albeit

nonmeaningful, sense all products are related. For our

purposes, however, we must determine whether the products

are sufficiently related so that consumers will confuse

Matsui’s use of "honeycomb" to describe the configuration

of its desiccant wheel as emanating from Munters.

We find as a factual matter that Munters’ and

Matsui’s products here are not sufficiently related te give

rise to confusion. Munters would wish us to categorize the

relevant market as “auxiliary plastics machinery", and thus

find the products strongly related. The facts, however, belie

such a finding. Munters does not carry a resin dryer or any

of the other auxiliary equipment offered by Matsui.

Material drying is a separate market into which Munters has

not ventured. Although we recognize that the products

before us are not completely unrelated, we find that they

are sufficiently unrelated and dissimilar that Matsui’s use of

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"honeycomb" in describing its wheel would not cause any

confusion among the relevant class of buyers.

d. The Degree of Care Likely to be Exercised

By Consumers

Where the cost of the trademarked product is high,

the courts assume that purchasers are more likely to be

discriminating than they otherwise might be. Source

Telecomputing, 635 F. Supp. 600 (citing Maxim’s Limited v.

Badonsky, 797 F.2d 1388, 393 (7th Cir. 1985)). As discussed

above, we find that the purchasers of the products here are

sophisticated and discriminating. We are convinced that

considerable expense and planning is involved in purchasing

ventilation equipment and material handling systems. We

therefore find that the degree of care likely to be exercised

by industrial purchasers of these products does not support

a finding of likelihood of confusion. In addition, due to the

degree of sophistication of the purchasers of this equipment,

and the resulting high degree of care exercised, we accord

great weight to this factor in the analysis. Much of the case

law regarding the likelihood of confusion issue has devel-

oped in response to products marketed to a wide and

unknowledgeable consuming public. This is clearly not the

case before us.

e. The Similarity of the Channels of Distribution

Munters and Matsui distribute their products to

their respective customers through their direct sales forces

and through sales representatives. The evidence establishes

that there is no overlap in sales representatives. Further,

there is no evidence that any common retail outlet or

distributor carries both Munters’ space dehumidifier and

Matsui’s resin dryer.

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As discussed above, we find that Munters’ space

dehumidifier and Matsui’s resin dryer are in two separate

markets. We also find that the two channels of trade are

substantially distinct. We note that Munters’ argument that

it markets its dehumidifier to the same customers who buy

Matsui’s resin dryer is not without merit. However,

Munters can point to only one processing plant that used its

dehumidifier and a resin dryer of any manufacturer. As a

result, we find that the channels of distribution are suffi-

ciently dissimilar that this element of the likelihood of

confusion does not help the plaintiff.

f. The Intent of Matsui

A showing by plaintiff of bad faith intent on the part

of alleged infringer is another factor that supports a finding

of likelihood of confusion. Ziebart Int’l, 802 F.2d at 227.

Munters does not challenge Matsui’s assertion that it,

Matsui, originally adopted the word "honeycomb" without

knowledge of Munters’ previous use. Rather, Munters

argues that the court should infer from Matsui’s intentional,

continued use of the word "honeycomb" “after notice from

plaintiff and after agreeing to terminate such use” that

Matsui had bad faith intent. The position of the Seventh

Circuit on this question is clear: "it is lawful to use a mark

that does not infringe some other; intentional infringement

creates some problems, but intentional use of a mark that

[the defendant] had every right to use is not itself a ground

on which to draw an adverse inference." M-F-G Corp. v.

EMRA Corp., 817 F.2d 410, 412 (7th Cir. 1987).

Also, mere knowledge on the part of the defendant

of the plaintiffs mark and the defendant’s refusal to

relinquish its mark upon demand are not necessarily

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indicative of bad faith. Those actions could also be ex-

plained by a good faith judgment on the part of the defen-

dant that its use does not infringe the plaintiffs mark.

Source Telecommuting, 635 F. Supp. at 614. We will not

make an inference of bad faith from evidence of conduct

that is compatible with a good faith business judgment.

Absent any evidence of bad faith, we find that this element

of the mark’s strength does not point to a likelihood of

confusion.

g. The Evidence of Actual Confusion

Actual confusion is the best evidence of likelihood

of confusion. Union Carbide, 531 F.2d at 383. Munters

presented none of this evidence. Munters offered no

evidence of misdirected mail, or of telephone calls or

inquiries indicating confusion from customers or potential

customers. Also, Munters did not present any survey

evidence indicating confusion. See McGraw-Edison, 787 F.

2d at 1172-73. Munters’ only evigence of actual confusion

was the testimony by its Direttor of Technology that

Munters’ own sales representatives were confused by

Matsui’s use of the word "honeycomb" as to whether Matsui

was using Munters rotors. The purpose of the likelihood of

confusion test is to determine the confusion of consumers,

or potential consumers, as to the source of the goods in

question. We give very little weight to the evidentiary

inference Munters would apparently like us to make:

customers are or will be confused because Munters’ sales

representatives are confused.

After considering and weighing all the factors, as set

forth by this Circuit, and viewing the totality of the circum-

stances, we reach the conclusion that the facts do not

sustain a finding that the current and potential purchasers

and users of Munters’ and Matsui’s products are likely to be

confused as to the source of the respective goods being

rendered by Munters under the mark "HoneyCombe” and

Matsui’s use of the word “honeycomb.” Accordingly, we find

that Munters’ Lanham Act claim and pendent state and

common law claims relating to infringement and unfair

competition are without merit since proof of likelihood of

confusion as to the source is essential to prevail on any of

these causes of action.’

2. Fair Use Doctrine

Section 33(b) of the Lanham Act provides that if a

registered mark has become incontestable, as is the case

3. The Illinois Deceptive Trade Practices Act defines as decep-

tive conduct that which:

(2) causes likelihood of confusion or of misunder-

standing as to the source,sponsorship, approval

or certification of goods or services;

(3) causes likelihood of confusion or of misunder-

standing as to the affiliation, connection, or

association with or certification by another.

Ill. Rev. Stat. ch. 121 1/2, sec. 312.

Under this act, which codified the Illinois common law of

unfair competition, a defendant is liable only if the plaintiff can

establish a likelihood of confusion between the parties’ products.

In addition, “[l]ikelihood of confusion’ has the same meaning in

unfair competition cases under the Deceptive Trade Practices Act

as it has in traditiona! infringement cases." McGraw-Edison, 787

F.2d at 1173-74 (quoting Hooker v. Columbia Pictures Industries,

Inc., 551 F. Supp. 1060, 1064 (N.D. Ill. 1982)).

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2. Fair Use Doctrine

Section 33(b) of the Lanham Act provides that if a

registered mark has become incontestable, as is the case

here with Munters’ mark "HoneyCombe", "the registration

shall be conclusive evidence of the registrant’s exclusive

right to use the registered mark.” 15 U.S.C. sec. 1115(b).

The Act subjects this general rule to seven explicit defenses,

one of which is the "fair use” defense. 15 U.S.C. sec.

1115(g)(4). The Lanham Act provides this defense against

valid trademarks when the term is not being used as a

trademark by the party charged with infringement and is

used in good faith to describe the product to its customers.

A.J. Canfield, 796 F.2d at 908; M.B.H. Enterprises, 633 F.2d

50. Section 33(b)(4) of the Lanham Act reads:

That the use of the name, term, or device charged

to be an infringement is a use, otherwise than as a

trade or service mark, of the party’s individual name

of anyone in privity with such a party, or of a term

or device which is descriptive of and used fairly and

in good faith only to describe to users the goods or

services of such party, or their geographic origin ....

15 U.S.C. sec. 1115(g)(4). Therefore, to sustain on the fair

use defense the defendant must establish three elements:

1) that the defendant used the word or symbol merely to

describe its product; 2) that it did not use the word or

symbol as a trademark; and 3) that it used the word or

symbol in question in good faith. Matsui has satisfied each

of these elements. Accord, Ringling Bros.-Barnum & Bailey

vy. Celozzi-Ettelson, 855 F.2d 480, 484 (7th Cir. 1988) (court

omitted non-trademark element).

A-30

First, Matsui uses "honeycomb" merely to describe

its desiccant wheel. Matsui does not use "honeycomb" in its

advertising literature to describe its resin dryer, but rather

uses it only to describe its wheel. Therefore, Munters’

argument that "honeycomb" does not directly describe

Matsui’s dryer is misplaced. As discussed previously,

"honeycomb" directly describes the desiccant wheel’s

configuration. A cross section of the wheel resembles "a

tissue of holes separated by thin walls or partitions.”

Webster’ ird New Int’] Dictionary. Although the most

common definition of "honeycomb" is a "mass of hexagonal

prismatic wax cells ... built by honeybees", id., "honeycomb"

is also clearly descriptive of the properties of Matsui’s

wheel.

Second, we find that Matsui does not use the word

"honeycomb" as a trademark. A trademark is any “word,

name, symbol, or device" used by a manufacturer or mer-

chant "to identify his goods and distinguish them from those

manufactured by others.". 15 U.S.C. sec. 1127. The evi-

dence does not establish that "honeycomb" identifies or

distinguishes Matsui’s resin dryer or its desiccant wheel. As

discussed previously, Matsui uses the word "honeycomb"

accurately and merely to describe the wheel’s configuration.

Third, Matsui used "honeycomb" in good faith. For

the reasons discussed previously, we find that Munters has

failed to establish bad faith intent on Matsui’s part. The

only evidence Munters presents is inferential: Matsui’s

continued use of the word "honeycomb" after the May 1988

agreement. However, as we stated, this conduct, without

more, does not demonstrate bad faith. No evidence

presented convinces us that Matsui’s actions were not made

within the context of good faith business judgment.

A-31

We therefore hold that Munters’ Lanham Act claims

are barred by the explicit fair use defense enumerated in

the Lanham Act.

B. Illinois’ Anti-Dilution Statute

The Illinois Anti-Dilution Act provides:

Every person ... adopting and using a mark [or]

trade name, ... may proceed by suit, and the circuit

court shall grant injunctions, to enjoin subsequent

use by another of the same or any similar mark [or]

trade name ... if there exists a likelihood of injury to

business reputation or of dilution of the distinctive

quality of the mark [or] trade name ... of the prior

user notwithstanding the absence of competition

between the parties or of confusion as to the source

of goods or services.

Ill. Rev. Stat. ch. 140, sec. 22 (1981). This Act "prevents the

gradual whittling away of trademarks’ distinctiveness

through use by third parties on non-confusing, non-compet-

ing products." Ringling Bros., 855 F.2d at 482. The court

must issue an injunction if: 1) the prior user shows a

likelihood of injury to reputation; or 2) the prior user shows

that the mark is distinctive and that the subsequent user’s

use dilutes that distinctiveness. McGraw-Edison, 787 F.2d

at 1174; Hyatt Corp. v. Hyatt Legal Services, 736 F.2d 1153,

1157 (7th Cir.), cert. denied, 105 S. Ct. 434 (1984).

1. Injury to Reputation

Munters argues that because it does not control the

quality of Matsui’s products in connection with the word

"honeycomb", there exists a likelihood of injury to Munters’

business reputation. However, nothing in the Illinois statute

or the relevant case law equates the mere loss of control

with injury. Although a subsequent user may detrimentally

effect the business reputation of the prior user, the opposite

result is equally plausible. The subsequent user may

enhance the prior user’s reputation. The two issues, control

and reputation, can be, and are here, mutually exclusive.

Munters has not offered any evidence to suggest that

Matsui’s use of “honeycomb” in connection with its dryer

will injure Munters’ reputation. In fact, the evidence

demonstrates the opposite conclusion. Matsui enjoys a

reputation, which is here unchallenged, as a marketer and

distributor of high quality plastic processing equipment.

Munters offered no evidence to prove that Matsui’s use of

the word "honeycomb" had injured Munters’ reputation or

to suggest it would likely be injured in the future.

2. Dilution of Distinctiveness

The analysis of a mark’s distinctiveness under the

anti-dilution statute is similar to the analysis of its strength

under the likelihood of confusion test of the Lanham Act.

Because the validity of Munters’ mark is again not

in question, our analysis here is not to determine the merits

of a challenge to "HoneyCombe.” Rather, we are here

concerned with the relevant buying class’ current recogni-

tion, or lack thereof, of Munters’ mark and whether

Matsui’s use of “honeycomb” will detrimentally effect that

recognition. See Exxon Corp. v. Exxene Corp., 696 F.2d

544, 550 (7th Cir. 1982) (court notes that without anti-

dilution statute "mental image would be blurred” of first

user’s mark). Although this is not an analysis of the

potential purchasers of Munters’ products.* Therefore, the

fact that Munters’ mark "HoneyCombe" is registered and

incontestable does not, for the sake of this analysis, help.

Instead, we adopt for purposes of determining the dilution

of "HoneyCombe"’s distinctiveness, the reasoning previously

discussed. For this purpose only we find Munters’ mark in

connection with its desiccant wheel weak, and in connection

with its dehumidifier somewhat stronger.

We next address whether Matsui’s use of "honey-

comb" will dilute the commercial magnetism of Munters’

mark. See Pc'sroid Corp. v. Polaraid Inc., 319 F.2d 830,

836 (7th Cir. 1963) ("dilution is an infection which, if

allowed to spread, will inevitably destroy the advertising

value of the mark"). We find it will not. "Important factors

in this determination [of dilution] are the similarity between

the marks used by the parties, and the extent of the market-

ing effort by the second user." Hyatt, 736 F.2d at 1158,

4. The Seventh Circuit has not established whether "“distinc-

tiveness" means something different under the Illinois Anti-

Dilution Act from under the Lanham Act. In Ringling Bros., 855

F.2d at 483, the court considered the argument suggesting such a

distinction “unique” and of “dubious merit.” However, the court

did not reach the merits of this issue.

We have chosen to analyze "distinctiveness" under the

likelihood of confusion test of the Lanham Act, under which

"HoneyCombe”’s conclusive presumption of distincitveness is not

determinative. If we were to define "distinctiveness" under the

Anti-Dilution Act as it is defined for validity purposes under the

Lanham Act, our finding would be different: we would conclu-

sively presume "HoneyCombe” distinctive. In either case, our

outcome here would be the same because the Anti-Dilution Act

applies only to trademarks, which Matsui’s use of “honeycomb” is

not.

A-34

value of the mark"). We find it will not. "Important factors

in this determination [of dilution] are the similarity between

the marks used by the parties, and the extent of the rarket-

ing effort by the second user." Hyatt, 736 F.2d at 1158,

(citing Polaroid, 319 F.2d at 832); Instrumentalist Co. v.

Marine Corps League, 509 F. Supp. 323, 323 (N.D. II.

1981)). First we note our previous discussion of the two

marks’ similarities. Second, the Hyatt court notes and the

plain language of the statute makes clear this anti-dilution

statute anticipates the gradual erosion of the strength of a

trademark by another trademark. As we noted earlier,

Matsui does not use "honeycomb" as a trademark. Conse-

quently, a second important indicia of dilution, the market-

ing effort by Matsui, is in this context a non sequitur:

Matsui does not market its products under "honeycomb."

The purpose of this Act is presumably not to stifle the non-

trademark use of descriptive words. Rather, this statute

protects trademarks in cases in which the likelihood of

confusion is too slight to warrant injunction, but in which a

second user waters down the effectiveness of the first user’s

mark. We are not faced with this scenario in the case

before us. Munters’ mark is not strong, and Matsui’s use of

"honeycomb" does nothing to detract from the magnetism of

Munters’ mark. We therefore find that Matsui’s use of the

word "honeycomb" does not dilute whatever distinctiveness

Munters’ mark "HoneyCombe" possesses.

C. Breach of Contract

Munters further argues that Matsui breached an

agreement signed in May 1988 between the two parties

when Matsui continued to describe its desiccant wheel in

advertising literature using the word "honeycomb." Munters

contends the agreement required Matsui to cease using any

form of the word "honeycomb." Matsui counters by arguing

that the agreement incorporated by reference an earlier

accord in which Matsui agreed to cease using "honeycomb"

in its trademark capacity but reserved the right to continue

using "honeycomb" in its non-trademark sense.

We do not need to resolve the ambiguity of this

agreement because the scope of relief sought by Munters--

that this Court enjoin Matsui from continued use of

"honeycomb" in trademark form--is the same as Matsui’s

interpretation of its obligations under the agreement.

Munters does not seek to enjoin Matsui from any and all

use of the word "honeycomb"; it seeks only to enjoin

Matsui’s infringement of Munters’ mark. For the reasons

we have previously stated, we hold that Matsui’s use of the

word "honeycomb" in its non-trademark sense in its advertis-

ing literature does not infringe Matsui’s use of

"HoneyCombe.". Thus Matsui’s post-agreement conduct

does not exceed the relief sought here by Munters.

IV. CONCLUSION

For the above reasons we deny the plaintiff's motion

for permanent injunction to the extent defendant continues

only to use the word "honeycomb" in its non-trademark form

to describe fairly the configuration of its desiccant wheel

located within its resin dryer. We also deny the defendant’s

A-36

motion to amend its answer and counterclaim challenging

the registration status of the plaintiffs valid trademark.

Enter

‘; James B. Zagel

ames B. Zagel

United States District Judge

Date _ Oct. 25, 1989

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.