Haas Door Co. v. Haas Garage Door Co., No. 3:13 CV 2507, 2016 WL 1047242 (N.D. Ohio Mar. 16, 2016)
A family-owned business split, and split a trademark, and then things went bad.
Founded in 1953, Haas Door Sales eventually became Haas Door Company and Haas Garage Door Company. Haas Door Sales focused exclusively on retail sales and installation of garage doors; Haas Door Company was incorporated for the purpose of manufacturing garage doors. Haas Garage Door Company took over retail sales; both Haas Door (manufacturing) and Haas Garage Door (retail sales, installation, and repair) used the HAAS mark. In 1989, the owners sold Haas Door, leaving them with no right to make garage doors, under the HAAS mark or otherwise, pursuant to a noncompete agreement—though those owners subsequently retired. Haas Garage Door was an authorized dealer of Haas Door, but a dispute arose between the companies and Haas Door terminated Haas Garage Door’s authorized dealership. Haas Door has a registration for HAAS for garage doors and hardware.
The court found that the parties each had separate and distinct rights in the HAAS mark. “The HAAS mark is connected to two distinctively different goods and services.” (That strikes me as a bit of an overstatement, from a consumer perspective—it was not the greatest idea to split them like that.)
While not resolving the core trademark infringement claims based on HAAS, the court granted partial summary judgment to Haas Door based on Haas Garage Door’s use of the AMERICAN TRADITIONS SERIES mark, which Haas Door had used for high end garage doors since 2005. Haas Garage Door assembled doors and sold them under the name AMERICAN TRADITIONS SERIES, using the HAAS mark. The court found likely confusion, as well as actual confusion. An architect was deceived into buying from Haas Garage Door, “[d]espite doing due diligence and meeting with [Haas Garage Door] on multiple occasions.” He was misled into believing that both Haas Door and Haas Garage Door produced the same product, but at different locations, and then noticed quality differences in the door he bought. Likewise, the owner of a retail garage door sales, installation, and repair business mistakenly contacted Haas Garage Door and “was misled into believing he was engaging in a business relationship where he was obtaining doors directly from the manufacturer, i.e. Haas Door.” When he found out the truth, he ended his relationship with Haas Garage Door. These events showed likely confusion even among sophisticated purchasers.
In addition, the court found Haas Garage Door liable for false advertising for using a label on the garage doors that said HAAS GARAGE DOOR COMPANY [contact info] MANUFACTURERS OF: RESIDENTIAL, COMMERCIAL & INDUSTRIAL OVERHEAD DOORS & ELECTRIC OPENERS. Haas Garage Door isn’t a manufacturer, but it used the label on every door it installed or serviced for years. This was a literally false claim, so the court presumed actual deception and materiality. There was also a causal link to harm to Haas Door. “This misrepresentation harms Haas Door by depriving the company of the opportunity to offer customers its products, made to its standards, policies, and warranties.”