Using dominant competitor's part names/numbers for comparison isn't false advertising, TM infringement, or (c) infringement

There really should be a fee shift when a competitor harasses another competitor for daring to make comparisons of part numbers, but we don't seem to live in that world. 

Simpson Strong-Tie Co. v. Mitek Inc., 2023 WL 8697700, No. 20-cv-06957-VKD (N.D. Cal. Dec. 15, 2023)

Simpson sued its competitor MiTek for using Simpson part numbers for structural connectors/fasteners for use in the construction industry in its catalogs/other promotional material; the court here, after a nonjury trial before the magistrate judge, rather comprehensively rejects its false advertising, trademark, and copyright claims. (It sure would be nice if we could get a consensus that copyright in parts numbers and names should not be allowed.)

Structural connectors are used to join, and transfer the load between, different structural members, including vertical members like studs and posts, horizontal members like floor joists and roof trusses, and foundations. The engineer of record must indicate on construction drawings the specific structural connectors that will be used on a given project, whether a custom connector designed by the engineer to join and transfer the load between members or a pre-engineered connector. Typically, the engineer will specify a connector noting both part name and manufacturer (e.g., Simpson or MiTek), which the contractor/subcontractor is responsible for purchasing. The configuration and load capacity are the two most important considerations for selecting a connector, though aesthetics, treatment, and cost also play roles.

Simpson’s structural connectors are specified on most construction drawings in the US; its market share is over 75%. A contractor may request that a different connector be used, but may not use a different connector or otherwise deviate from the construction documents without the engineer’s approval. 

For decades, companies selling structural connectors have used descriptive product names, and names that consist of an acronym formed from the initial letters of the words of the product name followed by a model number or stock number. The product names are formed from words that are common in the construction industry, including: hanger, anchor, clip, concrete, masonry, brick, post, column, cap, tie, strap, beam, base, girder, rafter, roof, truss, hold down, plate, and retrofit. Simpson and MiTek part names generally consist of an acronym formed from the initial letters of the words that describe the connector in the product name, followed by a model number or stock number that corresponds to information about the particular connector, such as load capacity or size. Although Simpson’s naming process uses descriptive words, it’s “not dictated by a rule or system,” though it is limited by the number of characters that can be used—a maximum of 16. 

MiTek’s product and part names are also descriptive, but MiTek often begins by assigning a MiTek connector in development the same name as the Simpson connector with which MiTek intends to compete. Sometimes it keeps that name for sale. For 51 of MiTek’s structural connectors, MiTek’s part name is identical to the part name for the Simpson connector for the same application, and for 32, its part name differs from the part name for the Simpson connector for the same application by one letter.

Engineers rely on the information in the parties’ catalogs in evaluating whether a connector can be used in a particular application, and contractors may also do so. Simpson’s catalog includes a two-page “alphabetical product index” or “API,” an alphabetical list of the part names for the connectors included in the catalog with the page number where information about the connector can be found. New parts in recent catalogs are marked as new; Simpson registered copyrights in two of its recent catalogs. All Simpson’s connectors, catalogs, marketing literature, and retail display materials, are clearly labeled with the “Simpson Strong-Tie” name.

MiTek’s 60th product catalog also contains a reference number index, which includes most of the part names listed in the API in Simpson’s 2019-2020 Wood Construction Connectors catalog; the same was true of the most recent product catalog. All MiTek’s connectors, catalogs, marketing literature, and retail display materials, are clearly labeled with the “MiTek” name.

For decades, companies selling structural connectors have used “reference numbers” to cross-reference their competitors’ products, including charts listing [X] part names next to competitors’ part names, including Simpson’s. When MiTek uses reference numbers in its marketing materials, it does not affirmatively identify the reference numbers as Simpson part names. The MiTek catalogs’ reference number index lists Simpson part names in alphabetical order, without attribution to Simpson, and the page number where a MiTek connector product may be found, and are introduced with the text:

Reference numbers shown through the charts in this catalog are part numbers which may be more familiar to customers in various regions of the United States. These are included for the convenience of our new customers who have recently switched from a competitor’s product line to [MiTek/USP].

The reference numbers in this catalog are for general application comparison only and should not be used as a substitution tool. The user is responsible to compare specific load values, fastener schedules, material specifications, and other factors to determine suitability of use for any particular product.

MiTek’s catalogs also use Simpson part names as reference numbers, without attribution to Simpson, in the tables that summarize the technical information for the MiTek connector offered (see second column, Ref. No.):

MiTek’s Reference Number Conversion Guide likewise lists Simpson part names in alphabetical order, without attribution to Simpson, next to MiTek part names, and this use of reference numbers is repeated in its website/software/mobile app and point of sale materials.

example of point of sale display with "ref. #" in upper right under MiTek part number

Most MiTek connectors have at least one attribute that differs from the referenced Simpson connector. Nonetheless, MiTek’s use of reference numbers “is consistent with how reference numbers have been used in the construction industry for decades, and in particular with how reference numbers have been used by providers of structural connectors.”

Simpson offered no admissible evidence of actual confusion, and no evidence that anyone chose to specify or purchase a MiTek connector based on MiTek’s use of a Simpson part number as a reference number because the engineer believed the reference number meant that the MiTek connector was equivalent to or substitutable for a Simpson connector. MiTek received inquiries about whether its connectors could be used in particular applications, including in place of Simpson’s, but there was no evidence that any inquiry arose from confusion or misunderstanding associated with MiTek’s use of Simpson part names as reference numbers or MiTek’s use of part names similar or identical to Simpson part names. Although a customer (reportedly) expressed concern that a MiTek product wasn’t a good substitute for the referenced Simpson product, there was no admissible evidence that the consumer was confused or misled.

Simpson offered a survey purporting to show confusion as to (1) source/affiliation/authorization and (2) equivalence.

False advertising: The use of a Simpson part as a reference number was not a necessary implication that the MiTek parts were equivalent and substitutable in all respects; one reasonable interpretation was that the products were generally suited to the same application or function and should be compared. Nor, for similar reasons, was the use intentionally misleading.

Because Simpson’s structural connectors are specified in the first instance on most construction drawings in the United States, the reference number serves as a starting point for identifying the relevant MiTek connector for further investigation for a possible substitution of the MiTek connector for the Simpson connector. Even where Simpson structural connectors are not already specified on the construction drawings, because Simpson is by far the dominant provider of structural connectors throughout the United States and therefore familiar to designers and engineers, the reference number serves a similar purpose as a starting point for identifying the relevant MiTek connector for evaluation to be specified instead of or in addition to (as in the case of dual specification) the referenced Simpson connector.

Simpson’s survey was unpersuasive because it was suggestive. For example, instead of using an open-ended question asking respondents what “Ref #: DTT1Z” means on the MiTek product label, the survey used a close-ended question (i.e. “do you believe that ...”), suggesting to respondents (a) that DTT1Z refers to a product that belongs to a company other than MiTek and (b) that using “DTT1Z” as a reference means that MiTek is communicating its product is equivalent to the product of another company. This meant the survey offered “no meaningful evidence” of confusion. Also, the control group respondents were exposed to the same MiTek stimuli, but the reference numbers were removed; the questions didn’t make sense in that context. For example, the control respondents were asked whether “based on this label, do you believe that MiTek sells [a product number not included in the label.]” MiTek’s expert testified that “there’s no way that [the respondents] could intelligently say yes. How could they say yes when don’t know what’s being compared?” Even so, the results of the primary and control surveys were very similar, “suggesting that the primary survey results are not reliable indicators of how the relevant audience understands MiTek’s use of reference numbers.”

Nor was the expert’s conclusion that the responses showed recognition of the numbers as Simpson part numbers reliable. The survey tested only six part names for “distinctiveness” or “secondary meaning,” and the results didn’t indicate that respondents identify these particular part names with Simpson.

Materiality was also a problem. With few exceptions, the engineer of record is in charge of choosing the structural connectors, and Simpson didn’t show that they were influenced “to any degree” by MiTek’s use of Simpson part numbers as reference numbers. They consider geometry, load capacity or strength, and, to a lesser extent, aesthetics, treatment, and cost.

Nor did Simpson show injury.

Passing off/§43(a)(1)(A): The part names were descriptive or, in some cases, generic. The court did not find secondary meaning. “[T]he relevant audience typically does not encounter Simpson’s part names alone,” but rather with Simpson and/or Strong-Tie. The evidence showed that engineers specify connectors by manufacturer (i.e. Simpson or MiTek or both) in addition to including specific part names on construction drawing.

And even if Simpson had shown secondary meaning, it couldn’t show likely confusion. Although similarity of “marks” and direct competition/overlapping marketing channels favored Simpson, strength, actual confusion, and consumer sophistication didn’t. As for intent, while MiTek did use some names identical to those first used by Simpson, “the Court is not persuaded that MiTek did so with the intent to confuse the relevant audience, but rather because the names described well the connector at issue.”

California UCL: same.

Copyright infringement of the API: I’m not sure there was any copying in fact of the index, unless MiTek replicated names of parts it didn’t stock! But it doesn’t matter. Merger/thin copyright, including the lack of protectability of product names/abbreviations that are standard or prevalent in an industry, prevented any finding of infringement. Alphabetical order, of course, is not protected, but Simpson argued that its product names for the connectors and their corresponding part names reflected at least a minimal degree of creativity and were protectable elements of the API. “Some of Simpson’s part names appear to lack even minimal creativity, see, e.g., (‘H’ for ‘Hurricane Ties’), but most of the others have the minimal level of creativity required for copyright protection, see, e.g., (‘HSLQ’ for ‘Heavy Shear Transfer Angle’).” Ugh. “[W]ith some exceptions, MiTek has not shown that there are so few ways of naming the connectors at issue that the part name merges with the idea of the connector itself or is otherwise unprotectable, particularly where the part name has four or five letters.” Ugh again.

Nonetheless, even assuming that all the product names in the APIs qualified for copyright protection, the copying was de minimis. The catalogs were concededly not substantially similar—the alleged copying was limited to the new material, no more than 20 new part names, in each API, of which MiTek copied at most 12 out of about 400 names (in a 300+ page catalog). Both in quantity and quality, this was de minimis. This would be true even if the court considered the API as a whole as a protected work.

Plus, even if there had been substantial similarity, the use was fair. (Applause to the court for separately considering protectability and substantial similarity instead of just considering them in factors two and three of the fair use analysis, which courts often unfortunately do.) Though MiTek’s use was commercial, so was Simpson’s, and there was more scope for fair use of its highly factual work. The amount used was tiny, and there was no effect on the actual or potential market for the works, “as there is no such market for Simpson’s catalogs, but only for the connectors the catalogs describe.” But asserting a copyright claim didn’t constitute misuse because there were itty-bitty copyrightable bits.

MiTek also didn’t show laches, even though Simpson knew of this type of use since at least 2013, and Simpson knew of similar uses of Simpson part names by other competitors, including MiTek’s predecessor companies, since at least 1988. At least by 2015, Simpson knew that MiTek planned to continue ignoring its legal threats; this was unreasonable delay. But, because Simpson was seeking only prospective injunctive relief, that wasn’t enough.

Was there evidentiary prejudice? MiTek argued that relevant documents and witnesses with information regarding early uses of product names and part names by companies other Simpson were no longer available by the time Simpson filed this action. But none of the non-copyright claims depended on the idea that Simpson created the part names or was the first user.  “Nor does the question of whether Simpson’s part names serve a source-identifying function now depend on another company’s use of the same part name at some point in the past.” (Genericity can, or at least could; maybe not post-Booking.com.) And MiTek already made a persuasive showing on industry practice, so it didn’t need better or different evidence.

Nor was there expectations-based prejudice because MiTek didn’t show that it would have avoided investments or changed its advertising had Simpson sued earlier.