Sunlighten, Inc. v. Finnmark Designs, LLC

District Court, D. Nevada·Decided April 24, 2023·No. 2:20-cv-00127·Unknown

Opinion

Nevada Bar No. 09515 1050 Indigo Drive, Suite 200B Las Vegas, Nevada 89145 Telephone: (702) 910-3329 Facsimile: (702) 553-3467 Email: jblum@wileypetersenlaw.com JAMES J. KERNELL, ESQ. (Pro Hac Vice) Kansas Bar No. 19559 KYLE D. DONNELLY, ESQ. (Pro Hac Vice) Kansas Bar No. 25531 AVEK IP, LLC 8900 State Line Road, Suite 500 Leawood, Kansas 66206 Telephone: (913) 549-4700 Facsimile: (913) 549-4646 Email: jkernell@avekip.com kdonnelly@avekip.com Attorneys for Plaintiff Sunlighten, Inc. SUNLIGHTEN, INC., Case No.: 2:20-cv-00127-CDS-NJK Plaintiff v. JOINT PRETRIAL ORDER Defendant After pretrial proceedings in this case, IT IS ORDERED: I. A. Plaintiff’s Statement of the Case This is an action for unfair competition and false designation of origin under 15 U.S.C. §1125(a), violation of Nevada Deceptive Trade Practices Nevada Revised Statute 598, and Trademark Infringement and Unfair Competition under Nevada common law. 1. Sunlighten’s Contentions Sunlighten has been in business since 1999 and has focused its business on creating wellness products and services that enable consumers to improve their quality of life. Sunlighten is known for its unique and innovative sauna designs along with other wellness products. Based in Overland Park, Kansas, Sunlighten is a leader in the sauna market and is a consistent innovator when it comes to infrared-based saunas and heaters. A major factor that has allowed Sunlighten to surpass competitors is the way in which they construct their saunas. Each sauna is made to be over 30% thicker than the industry standard while the wood and process that they use to construct them is meant to be environmentally friendly. Sunlighten’s industry-leading approach to the design and manufacturing of quality saunas has resulted in intellectual property protection for its innovations, including utility patents, design patents, trademarks, and trade dress protection. Sunlighten’s innovations have resulted in emulation by its competitors, who have attempted to capitalize on Sunlighten’s success by imitating its innovative and distinctive product designs. Such is the case with the present lawsuit. Finnmark has copied Sunlighten’s proprietary, patented sauna designs. Not only has Finnmark copied the designs, but it has used a confusingly similar trademark and trade dress to lure consumers into purchasing its saunas believing them to be Sunlighten saunas. Sunlighten has used the Empower trademark for saunas continuously and exclusively since 2009. Sometime in 2019, Finnmark began importing and selling saunas marked with the Empower trademark. Upon learning of Finnmark’s use of the Empower trademark with its saunas, Sunlighten sent Finnmark a letter dated January 21, 2020 demanding that Finnmark immediately cease use of Empower or any confusingly similar name, in any manner associated with saunas. Sunlighten also demanded that Finnmark: (1) promptly inform in writing its dealers, distributors, retailers, or any other entity which sells Finnmark saunas to immediately cease use of Empower or any confusingly similar name, in any manner associated with its saunas and destroy all printed materials which include Empower; (2) within 14 days, provide a complete accounting of all Finnmark Infringing Saunas ordered, imported, sold, and in inventory, including the name and address of the manufacturer, importer, seller, and the location of the sales or units in inventory; (3)pay a royalty of 25% of the retail sales price for all Finnmark Infringing Saunas already sold; (4) destroy all Finnmark Infringing Saunas in inventory; and (5) cease all future importation of Finnmark Infringing Saunas. Shortly thereafter Finnmark removed Empower from its website, thereby admitting that it was infringing Sunlighten’s trademark, but refused to comply with any of the other demands. Finnmark has refused to stipulate and swear that it will not use the Empower trademark, or any confusingly similar trademark with sales of its saunas in the future. Before it ceased infringement of the Empower trademark, Finnmark sold 800 saunas under the Empower name at a profit of $100 each for a total profit of $80,000. Finnmark sold an additional 18 saunas under the Empower name at a retail price of $3,795 each for a total of $68,310. When Finnmark entered into the sauna market in 2019, it knew of Sunlighten and Sunlighten’s use of Empower for its saunas. When a violation of any right of the registrant of a mark registered in the Patent and Trademark Office, a violation under section 1125(a) or (d) of this title, or a willful violation under section 1125(c) of this title, shall have been established in any civil action arising under this chapter, the plaintiff shall be entitled, subject to the provisions of sections 1111 and 1114 of this title, and subject to the principles of equity, to recover (1) defendant's profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action. The court shall assess such profits and damages or cause the same to be assessed under its direction. In assessing profits the plaintiff shall be required to prove defendant's sales only; defendant must prove all elements of cost or deduction claimed. In assessing damages the court may enter judgment, according to the circumstances of the case, for any sum above the amount found as actual damages, not exceeding three times such amount. If the court shall find that the amount of the recovery based on profits is either inadequate or excessive the court may in its discretion enter judgment for such sum as the court shall find to be just, according to the circumstances of the case . . . (emphasis added). 15 U.S.C. § 1117(a). B. Defendant’s Statement of the Case Defendant FINNMARK DESIGNS, LLC (“Finnmark”) sets forth the following statement of the nature of this action. 1. Nature of the Action: This action commenced when Sunlighten sued Finnmark claiming infringement of two design patents, trade dress infringement, and both federal, state, and common law claims relating to alleged infringement of an unregistered trademark in the word Empower for saunas. After both parties filed motions for summary judgment, this Court held: • Both design patents were invalid as anticipated by Sunlighten’s sales of saunas covered by those patents more than one year before the effective filing date of both patents. This holding was based on those patents not being entitled to the filing date of earlier patent applications. (ECF No. 77 at 9-14.) Therefore, Finnmark was granted judgment on Counts 1 and 2 of Plaintiff’s Complaint. • Sunlighten had not presented sufficient proof to raise a genuine issue of fact as to whether its trade dress had attained secondary meaning. (ECF No. 77 at 14-18.) Therefore, Finnmark was granted judgment on Count 4 of Plaintiff’s Complaint, as well as Counts 5 and 6 to the extent that they were based on trade dress infringement. (ECF No. 77 at 18 n.73.) • Sunlighten had not presented sufficient proof to raise a genuine issue of fact as to whether it had suffered any actual damages related to Finnmark’s alleged infringement of Sunlighten’s Empower mark. Therefore, the Court held that Finnmark was entitled to partial judgment on Sunlighten’s trademark damages claim. (ECF No. 77 at 20.) • This Court held that this case will proceed to trial on trademark infringement claims seeking disgorgement of profits and injunctive relief relating to Sunlighten’s alleged Empower trademark. (ECF No. 77 at 2, 21, 23.) 2. Finnmark’s Contentions Finnmark contends that Sunlighten cannot prove any trademark rights in and to the word Empower, which was not a registered trademark during the relevant timeframe and was only used to identify the largest one of Sunlighten’s five specific models of mPulse saunas (using the letter

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Sunlighten, Inc. v. Finnmark Designs, LLC, (D. Nev. 2023).

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