Polymeric Resources Corporation v. Pounds of Plastic, LLC

CourtDistrict Court, E.D. Kentucky
DecidedSeptember 20, 2023
Docket3:20-cv-00013
StatusUnknown

This text of Polymeric Resources Corporation v. Pounds of Plastic, LLC (Polymeric Resources Corporation v. Pounds of Plastic, LLC) is published on Counsel Stack Legal Research, covering District Court, E.D. Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Polymeric Resources Corporation v. Pounds of Plastic, LLC, (E.D. Ky. 2023).

Opinion

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF KENTUCKY CENTRAL DIVISION FRANKFORT

POLYMERIC RESOURCES ) CORPORATION, ) ) Case No. 3:20-cv-00013-GFVT-EBA Plaintiff, ) ) v. ) MEMORANDUM OPINION ) & POUNDS OF PLASTIC, LLC, et al., ) ORDER ) Defendants.

*** *** *** *** This matter is before the Court on a Motion for Attorneys’ Fees under the Lanham Act filed by Defendant Pounds of Plastic, LLC. [R. 193; R. 194 (redacted).] The Act permits courts to award fees in exceptional circumstances. Pounds bases its request on several burdens imposed by Plaintiff Polymeric Resources Corporation’s attempt to enforce a trademark via this lawsuit. But every litigation takes a toll on the parties. Because Pounds fails to show exceptionally problematic behavior by Polymeric, the Motion for Fees [R. 193; R. 194] is DENIED and Polymeric’s related Motion for a Hearing [R. 203] is likewise DENIED. I Polymeric is a New Jersey corporation specializing in the production of engineered thermoplastics, including various nylon polymers. [R. 99 at 1.] Richard Pounds worked for Polymeric between 1997 and 2006. Id. Mr. Pounds founded Defendant Pounds of Plastic, a Kentucky limited liability company, in January 2019. [R. 190 at 1.] Pounds is the sister company of a Canadian entity, Pounds of Plastic, Inc.1 Id. Polymeric alleges that American Pounds is its direct competitor. Id. This litigation focused on two trademarks. Id. at 2. The first trademark, NYLENE, is owned by Polymeric, who used it in connection with its nylon resin products for over forty years.

Id. Canadian Pounds owns the second trademark, NYLENIUM, which is also used as a descriptor for its nylon resin products. Id. Polymeric and Canadian Pounds coexisted without issue for many years. Id. The relationship soured when Polymeric viewed the founding of American Pounds as an expansion into the American thermoplastics market. Id. While American Pounds “has yet to start business operations at the Kentucky facility,” and has “made no sales of any products in the United States . . . specifically, no sales under NYLENIUM,” American Pounds has “filed an application with the USPTO (Serial No. 88605957) seeking to register” its NYLENIUM mark. [R. 105 at 3–4; R. 62 at 1; R. 1 at 8.] As a result, Polymeric filed this lawsuit seeking a declaratory judgment and permanent injunction to stop both American Pounds and Richard

Pounds from using the NYLENIUM mark in the United States due to risk of market confusion. [R. 1.] Importantly, Canadian Pounds is not a defendant, but Polymeric argued that Canadian Pounds’s activities can be imputed to American Pounds. [R. 177.] Polymeric’s suit alleged that American Pounds’s use of the NYLENIUM mark constitutes trademark infringement under Section 32(1) of the Lanham Act, false designation of origin and unfair competition under Section 43(a) of the Lanham Act, and unfair competition under Kentucky common law. [R. 1 at 10–13 (citing 15 U.S.C. §§ 1114(1), 1125(a)(1)(A)).] After protracted litigation, the parties filed competing motions for summary judgment. [R. 96;

1 For simplicity, this Opinion refers to Mr. Pounds and the Pounds entities collectively as Pounds. R. 105.] The Court granted Pounds’s Motion for Summary Judgment as to the federal claims, finding that American Pounds had not used the NYLENIUM trademark in commerce in the United States and that the Court did not have extraterritorial jurisdiction over Mr. Pounds regarding the Canadian company. [R. 190.] The Court also dismissed Polymeric’s state claims

without prejudice. Id. Now, Pounds moves for attorneys’ fees under the Lanham Act, alleging that Polymeric brought the lawsuit to “exact retribution for past disputes,” needlessly proceeded in multiple venues (this Court and the Trademark Trial and Appeal Board (TTAB)), and “engaged in oppressive and heavy-handed litigation tactics” even though it had no viable trademark infringement claim against the Defendants. [R. 193.] Pounds requests $486,485.14. Id. at 22. II Pounds’s motion will be denied because it fails to establish entitlement to fees under the Lanham Act. Under 15 U.S.C. § 1117(a), prevailing Lanham Act defendants are entitled to an award of attorneys’ fees in “exceptional” cases. Am. Council of Certified Podiatric Physicians &

Surgeons v. Am. Bd. of Podiatric Surgery, Inc., 185 F.3d 606, 624 (6th Cir. 1999). “[A]n ‘exceptional’ case is simply one that stands out from others with respect to the substantive strength of a party's litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated.” Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545, 554 (2014). In this Circuit, “a case is not exceptional unless the infringement was malicious, fraudulent, willful, or deliberate.” Audi AG v. D’Amato, 469 F.3d 534, 551 (6th Cir. 2006) (quoting Eagles, Ltd. v. Am. Eagle Found., 356 F.3d 724, 728 (6th Cir. 2004)) (internal quotations omitted). Oppressive lawsuits can satisfy this requirement. Eagles, Ltd., 356 F.3d at 728. The Eastern District of Michigan uses a two-prong inquiry to determine whether a case is exceptional under an oppressiveness standard, which is instructive in this case. See Int’l Techs. Consultants, Inc. v. Stewart, No. 07-13391, 2013 U.S. Dist. LEXIS 43692, at *19 (E.D. Mich. Jan. 28, 2013). This test requires (1) “an objective inquiry into whether the suit was unfounded

when it was brought and [(2)] a subjective inquiry into the plaintiff’s conduct during litigation.” Id. (citing Eagles, Ltd., 356 F.3d at 728–29). In any event, the district court’s decision as to whether attorneys’ fees should be awarded under the Lanham Act is highly discretionary. Evoqua Water Techs., LLC v. M.W. Watermark, LLC, 940 F.3d 222, 235 (6th Cir. 2019); see also Octane, 572 U.S. at 554 (stating that district courts “determine whether a case is exceptional in the case-by-case exercise of their discretion, considering the totality of the circumstances”). Ultimately, “recovery of attorneys’ fees under the Lanham Act is ‘rare.’” Collection v. Latham Cos., No. 5:20-CV-217-CHB, 2022 U.S. Dist. LEXIS 71523, at *10 (E.D. Ky. Apr. 19, 2022) (citing Octane, 572 U.S. at 555). The award of attorneys’ fees is meant to “provide protection against unfounded suits brought by trademark owners for harassment and the like.”

Eagles, Ltd., 356 F.3d at 729 (quoting S. Rep. No. 93-1400 (1974), reprinted in 1974 U.S.C.C.A.N. 7132, 7136). Thus, in many cases, “[w]here a plaintiff sues under a colorable, yet ultimately losing, argument, an award of attorney’s fees is inappropriate.” Am. Council of Certified Podiatric Physicians & Surgeons, 185 F.3d at 625. Pounds identifies several disputes that it believes show malicious conduct by Polymeric. It then argues that the totality of the circumstances merits an award of fees. But none of the individual issues goes beyond the pale of ordinary litigation. The Court considers each in turn. A First, Pounds argues that, in light of the concurrent proceeding before TTAB, Polymeric merely harassed Pounds by also filing a Complaint in federal court raising the same allegations. [R. 193 at 5.] Pounds believes that Polymeric’s eventual choice to suspend the TTAB action

proves that Polymeric solely filed a duplicate action in order to intimidate them. Id.

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Polymeric Resources Corporation v. Pounds of Plastic, LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/polymeric-resources-corporation-v-pounds-of-plastic-llc-kyed-2023.