Mid-State Aftermarket Body Parts, Inc. v. MQVP, Inc.

466 F.3d 630, 80 U.S.P.Q. 2d (BNA) 1534, 2006 U.S. App. LEXIS 25862, 2006 WL 2973019
CourtCourt of Appeals for the Eighth Circuit
DecidedOctober 19, 2006
Docket05-3057
StatusPublished
Cited by6 cases

This text of 466 F.3d 630 (Mid-State Aftermarket Body Parts, Inc. v. MQVP, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mid-State Aftermarket Body Parts, Inc. v. MQVP, Inc., 466 F.3d 630, 80 U.S.P.Q. 2d (BNA) 1534, 2006 U.S. App. LEXIS 25862, 2006 WL 2973019 (8th Cir. 2006).

Opinion

LOKEN, Chief Judge.

This is a trademark infringement dispute between the owner of a registered service mark, MQVP, Inc., and an alleged infringer, Mid-State Aftermarket Body Parts, Inc. MQVP appeals the district court’s grant of summary judgment dismissing Lanham Act claims of infringement and false advertising. Concluding there are genuine issues of material fact as to whether Mid-State’s unauthorized use of MQVP’s service mark was “likely to cause confusion” as to the origin of products or services, 15 U.S.C. § 1125(a)(1)(A), or was false commercial advertising within *632 the meaning of 15 U.S.C. § 1125(a)(1)(B), we reverse.

I.

Insurers, automobile repair shops, and car owners have been legitimately concerned about the quality of parts used to repair damaged vehicles (aftermarket parts) and about the increasing use of counterfeit foreign parts. Responding to these concerns, a non-profit organization, Certified Automotive Parts Association (CAPA), was created in 1987. After testing, CAPA certifies that a particular part meets CAPA’s recognized quality standards. The manufacturer is then authorized to place CAPA’s certification mark on the external packaging of the certified part. 1

In 2000, MQVP, a for-profit company, began marketing a competing quality assurance program, the Manufacturers’ Qualification and Validation Program, and set out to enlist manufacturers and distributors of aftermarket parts. To participate, a manufacturer must have its plant “QS-9000 registered,” and a distributor must have an “ISO 9000” quality control implementation plan in place that is satisfactory to MQVP. 2 After a manufacturer is approved by MQVP, the program contemplates that each shipment of qualified parts will be entered into a “Global Online Certification System.” Run by MQVP online software, this system enables the end user of a specific part — a repair shop or insurer — to trace the shipment of that part from the manufacturer through the chain of distribution, thereby validating the part’s quality. The MQVP program also includes a second on-line software service, “Global Online Corrective Action Reporting,” which is a database of customer complaints and reports of non-conforming parts. This MQVP on-line software is available only to participating manufacturers and distributors. An early MQVP comparative advertising piece explained the advantages of its program as follows:

[MQVP] has taken the spirit of CAPA, added the globally recognized quality standard to which all OEM’s manufacture [QS-9000], included the added value of cradle to grave traceability and accountability and empowered it with on-line reporting software.

In 2001, MQVP registered three service marks to identify its new venture, MQVP® for the program itself, GOCERTS® for the on-line tracing system, and GOCAR® for the on-line complaint system. As amended by the Examining Attorney of the U.S. Patent and Trademark Office, the registration for the MQVP® service mark describes the services on which the mark will be used as:

Creating and maintaining a registry of manufacturers that validates that parts or products made by the manufacturers meet established part standards and product specifications and that the manufacturers listed are registered in and *633 follow ISO 9000, QS-9000, TS 16949 and other industry standards.

The MQVP program contemplated that participating manufacturers would qualify their parts as complying with QS-9000 quality standards and sell those parts to participating distributors using the GO-CERTS® on-line tracing software so that end users may validate the quality of a specific part used to repair a vehicle. But the record in this case makes it clear that at least some participating manufacturers were unwilling to limit sales of qualified parts to participating MQVP distributors. Sales to non-MQVP-participants led to this Lanham Act dispute.

Mid-State is a distributor of aftermarket automobile parts that it purchases from various vendors. In 2002, Mid-State advertised that it has “MQVP parts available” in its catalog, various trade journals, flyers, and over the telephone to customers and potential customers who requested “MQVP parts.” Mid-State also recorded “MQVP parts” on pick tickets sent to Mid-State customers to confirm their orders. In 2003, when Mid-State declined MQVP’s offer of a license to use the MQVP® service mark and to participate in the MQVP program, MQVP demanded that Mid-State cease all use of the MQVP® mark. Mid-State began telling customers that it is not a participant in the MQVP program but continued its use of the mark. This lawsuit followed. Mid-State argues that its statement “MQVP parts available” is true because Mid-State buys qualified parts from MQVP-participating manufacturers.

II.

We conclude that the district court’s application of the Lanham Act to the undisputed and disputed facts of this case is flawed. First, the court criticized MQVP because it uses a registered service mark, MQVP®, “to refer to products, and it licenses others to use the mark MQVP® to refer to products.” But a service mark may properly be used to identify the goods associated with the services protected by the mark, so long as the mark continues to identify the presence of some services and not only goods. Therefore, “while the distinction between a trademark and a service mark may be relevant for registration purposes, it is not particularly relevant for the purposes of the likelihood of confusion analysis.” Frehling Enters., Inc. v. Int'l Select Group, Inc., 192 F.3d 1330, 1334 n. 1 (11th Cir.1999). Moreover, in this case, whether MQVP uses the mark to refer to products as well as its program services is a disputed fact. Mid-State without MQVP approval has used the mark to refer to products — “MQVP parts available” — and there is evidence that some program participants have used the mark in the same way. But MQVP submitted evidence that it has never atithorized such a use. Thus, whether MQVP has permitted participants to use the mark in the same way CAPA permits third parties to use its certification mark, and the relevance of that fact to the likelihood-of-confusion and false advertising inquiries, are issues for trial.

Next, misconstruing the “validating” component of the MQVP program, the district court concluded that MQVP describes and uses the MQVP® mark “in terms that fit the definition of’ a certification mark such as the CAPA mark. To be sure, Mid-State’s unauthorized use— “MQVP parts available” — makes MQVP® look like a certification mark for products, divorced from the validating on-line software services that MQVP markets as an essential part of the overall program. But MQVP registered MQVP® as a service mark, not a certification mark, and it is entitled to service mark protection. As described by MQVP, the mark identifies a *634

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466 F.3d 630, 80 U.S.P.Q. 2d (BNA) 1534, 2006 U.S. App. LEXIS 25862, 2006 WL 2973019, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mid-state-aftermarket-body-parts-inc-v-mqvp-inc-ca8-2006.