Wednesday, August 29, 2012

replacing manufacturer's mark with repairer's mark is ok

CheckPoint Fluidic Systems Intern., Ltd. v. Guccione, 2012 WL 3637389 (E.D. La.)

CheckPoint brought a number of claims against Ray Guccione and his company RAM Repairs, including trade secret/misappropriation, but I’m just looking at the Lanham Act and coordinate state law claims. CheckPoint sells chemical injection pumps and pump components.  Guccione had various previous relations with CheckPoint, including an employment relationship.  After he left, he became managing partner of RAM, which makes “Monkey Pumps” chemical injection pumps.  It also initially acted as a third-party repair business for pumps.

The court rejected Lanham Act claims based on RAM’s repair activities: removal of CheckPoint identifiers when repairing CheckPoint pumps and application of RAM stickers, and failure to use CheckPoint parts in the repairs.  The court allowed false advertising claims to continue based on claims that Monkey Pumps were identical to CheckPoint pumps.

Putting RAM stickers in place of CheckPoint identifiers wasn’t reverse palming off.  First, there was no evidence that RAM sold, rather than repaired, the pumps, and the Lanham Act requires sales.  Separately, repairing, rebuilding, or modifying a product at the request of the product’s owner doesn’t violate the Lanham Act.  (The court doesn’t elaborate given the clear precedent, but it’s hard to imagine how the owner could be confused; post-sale confusion apparently doesn’t come into it.)  The same principle applied to the use of RAM parts to repair CheckPoint pumps.  There was no false designation of the parts as CheckPoint parts; “RAM labeled itself as the source of the repairs, not the originator of the pumps.”

The false advertising claims were based on statements such as an email to a prospective customer: “RAM Repairs' trademark Monkey Pump pneumatic chemical injection pump is identical to the CheckPoint 1250 Pump. Therefore, the replacement parts are identical and interchangeable.”  There was evidence of falsity: defendants’ expert identified differences between the parts and found that some of the Monkey Pump parts “appeared to be [of] slightly less quality” than CheckPoint pump parts.

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