Taylor Made Golf Co., Inc. v. MJT CONSULTING GROUP, LLC

265 F. Supp. 2d 732, 2003 U.S. Dist. LEXIS 14695, 2003 WL 21283862
CourtDistrict Court, N.D. Texas
DecidedMay 30, 2003
Docket3:01-cv-02072
StatusPublished
Cited by13 cases

This text of 265 F. Supp. 2d 732 (Taylor Made Golf Co., Inc. v. MJT CONSULTING GROUP, LLC) is published on Counsel Stack Legal Research, covering District Court, N.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Taylor Made Golf Co., Inc. v. MJT CONSULTING GROUP, LLC, 265 F. Supp. 2d 732, 2003 U.S. Dist. LEXIS 14695, 2003 WL 21283862 (N.D. Tex. 2003).

Opinion

ORDER

SOLIS, District Judge.

Now before the Court is Plaintiffs Motion for Summary Judgment, filed February 28, 2003. 1 After considering the parties’ briefing, arguments, and the applicable law, the Court hereby GRANTS IN PART and DENIES IN PART Plaintiffs Motion.

I. Factual Background

Plaintiff Taylor Made Golf Company, Inc. d/b/a Taylor Made-Adidas Golf Company (“Taylor Made” or “Plaintiff’) has sued Defendants MJT Consulting Group, LLC (“MJT”), Marc W. Gunderson (“Gun-derson”), and E-Golf Investments, LLC (“E-Golf’) for trademark infringement and unfair competition under federal and state law. 2 Taylor Made develops, manufactures, promotes, distributes, and sells golf clubs, golf bags, and related products. 3 Plaintiff holds various trademarks and has other trademark applications currently pending. 4

Defendant MJT Consulting Groups, LLC (“MJT”) is a Texas limited liability company having its principal place of business in Arlington, Texas. 5 Defendant E-Golf Investments, LLC (“E-Golf’) is also a Texas limited liability company having its principal place of business in Arlington, Texas. 6 Defendant Gunderson — an individual residing in Crowley, Texas — owns 98% of MJT. 7 He is the sole owner of E-Golf. 8 E-Golf, in turn, owns and operates two retail stores, Golf Liquidation Centers, one located in Fort Worth, the other in Dallas. 9 From August 2001 through No *735 vember 2001, E-Golf was operated under an agreement with Mercantile Bank of Fort Worth, Texas, for James W. Hendrix and Henry W. Simon, Jr., to be in charge of the company while Gunderson acted as an uncompensated employee. 10

Golf Liquidation Centers advertised the sale of Taylor Made golf clubs in the Fort Worth Star Telegram on September 21, 2001, and the Dallas Morning News on October 6, 2001. 11 Neither MJT, E-Golf, nor Gunderson, however, is or has ever been an authorized distributor of Taylor Made golf products. 12 According to Gunderson, E-Golf obtained three hundred series 300 Taylor Made golf clubs (200 assembled, 100 heads only) from KG Golf. 13 E-Golf sold the clubs to the public for $250 each under a consignment agreement with KG Golf, 14 receiving $25 per club (10% of the agreed-upon sales price) on the 294 clubs sold. 15 E-Golf also sold Taylor Made clubs that had been purchased in bankruptcy sales, though those sales are not the subject of this suit. 16

By letter dated September 21, 2001, counsel for Taylor Made informed Gunder-son that it had “obtained evidence that [MJT] is presently engaged in the sale of golf clubs that purport to be genuine Taylor Made goods, which have their original serial numbers removed and/or incorporate replacement parts, including replacement shafts that were not manufactured *736 by Taylor Made.” 17 The letter demanded that Gunderson and MJT cease and desist selling products bearing the TAYLOR MADE mark, surrender all unauthorized products, cease and desist advertising and promoting unauthorized products, and cooperate in an investigation of the source of the unauthorized products. 18 The summary-judgment record indicates that counsel for Taylor Made spoke with counsel for Gunderson and MJT sometime before October 1, 2001, but failed to reach an agreement regarding the sale of allegedly counterfeit goods. 19

On September 25, 2001, a Taylor Made representative visited the Golf Liquidation store in Fort Worth and purchased a Taylor Made Metalwood. 20 While at the store, he “observed approximately 100 Taylor Made 300 Series Metalwoods on display, all with UST Proforce 65 shafts and Winn grips.” 21 Four days later, another Taylor made employee purchased three clubs at the Dallas store. 22 Approximately fifty Taylor Made clubs were on the sales floor, the majority of which had series 320 heads; series 300 and series 360 club heads were also available. 23 Sales representatives at both stores told these buyers that the- Taylor Made clubs they viewed were “new.” 24

Brian Halleck, a manager in the Custom Club and Repair Department of Taylor Made, examined the golf clubs to determine whether they were genuine. 25 He explained, “Taylor Made does not sell golf club heads and golf club shafts as separate components. To the contrary, Taylor Made only places into the stream of commerce complete golf clubs with the shafts and club heads folly assembled by Taylor Made professionals.” 26 According to Hal-leck, Plaintiff “always controls ... the ‘shafting’ of its clubs, pursuant to Taylor Made quality standards.” 27 It is Taylor Made’s practice to dispose of club heads that do not meet standard specifications as well as clubs that are damaged during the assembly process. 28 To make these discarded heads “inappropriate for future use and unattractive for sale by would be profiteers and counterfeiters, Taylor Made ‘crimps’ the hosel — the round metal parts in which the shafts are embedded — by crushing them with a sledgehammer.” 29 Taylor Made also dents defective club heads “to render their overall appearance unattractive and inappropriate for future sale.” 30 Taylor Made does not authorize the sale of its disposed products; the company uses a disposal company “to attend to their final destruction and disposal.” 31

Halleck examined the four clubs purchased from Golf Liquidation Centers and made the following findings:

*737 First, the hosels were defective and irregular, as if they had been reshaped with a hammer for purposes of fitting a round golf shaft.

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265 F. Supp. 2d 732, 2003 U.S. Dist. LEXIS 14695, 2003 WL 21283862, Counsel Stack Legal Research, https://law.counselstack.com/opinion/taylor-made-golf-co-inc-v-mjt-consulting-group-llc-txnd-2003.