Many of you are probably familiar with Kevin Trudeau. He is a widely-published author and has appeared in numerous infomercials. Trudeau filed suit in the Northern District of Illinois against defendant, Lanoue, for trademark infringement, cybersquatting, and related claims stemming from Lanoue's alleged use of the domain names "trudeau.com" and "kevintrudeau.com" to sell various products without Trudeau's permission. Defendant asserted various counterclaims. Both parties filed summary judgment motions and Trudeau also filed a motion to strike a portion of Defendant's reply brief.
Plaintiff's Motion to Strike
The Court first took up a fairly technical matter relating to summary judgment motions. A party may not introduce new arguments in a reply brief not previously mentioned in its memorandum in support of summary judgment. Defendant did not contest the strength and protectability of Trudeau's trademark in his original summary judgment filing. However, he sought to introduce this argument in a reply brief. The Court concluded that this was improper since such an action would deny Trudeau an adequate opportunity to respond. The Court thus granted Trudeau's motion to strike this section of defendant's reply brief.
Trademark and Related Claims
Defendant raised three main arguments in his summary judgment motion relating to the trademark claims: (1) Trudeau authorized him to use the trademarks, (2) no likelihood of confusion exists, and (3) he is protected from liability by the first-sale doctrine.
Defendant argued that he was impliedly authorized to sell the products using Trudeau's name and image due to the fact that the two have known each other for ten years and had a business relationship for the same length of time. Although Trudeau admitted knowing about defendant's use of the domain name trudeau.com for over five years prior to making any kind of complaint about such use, the Court decided that this was not sufficient to allow an inference of implied authorization (more on acquiescence below). The Court concluded that such an inference must be left to the trier of fact.
As for the likelihood of confusion argument, defendant claimed that no confusion existed since Trudeau relied on distributors to sell products to consumers and defendant was such a distributor. The Court rejected that argument under an infringement analysis. Even if defendant's allegations were true, he was still required not to confuse the public by implying an affiliation or association with Trudeau during a time in which defendant was not an authorized distributor. Due to various factual allegations by Trudeau, the Court concluded that the likelihood of confusion issue would need to be decided by the trier of fact.
Finally, defendant argued protection based on the first-sale doctrine which confers protection from Lanham Act claims to a purchaser who does no more than stock, display, and resell a trademarked product. However, since Trudeau denied that defendant was an authorized distributor of his products, the Court decided that it could not find as a matter of law that defendant was protected under the first-sale doctrine. Hence, it denied defendant's summary judgment motion on the trademark claims.
As for defendant's related claims, the Court concluded that, in Illinois, claims under the Consumer Fraud and Deceptive Business Practices Act, the Uniform Deceptive Trade Practices Act, and common law unfair competition must be resolved according to Lanham Act principles. Therefore, summary judgment as to these counts was also denied.
Cybersquatting Claim
Trudeau also filed a claim under the Anti-Cybersquatting Protection Act (ACPA), codified at 15 U.S.C. 1125(d), claiming that defendant had a bad faith intent to profit from the mark. Defendant argued that he should prevail on this claim as a matter of law, but the Court put great weight on the commercial aspect of defendant's websites, and defendant's lack of evidence as to bona fide non-commercial uses of Trudeau's name. The Court also mentioned the fact that defendant had previously attempted to register "trudeau.com" and "kevintrudeau.com" as federal trademarks and such applications were rejected. The Court, thus, surmised that this should have provided some notice to defendant that he does not have legitimate rights to use such marks. Since bad faith intent is a fact sensitive issue, the Court denied defendant's summary judgment motion as to the cybersquatting claim. [Note: I reviewed the USPTO records with respect to these two trademark applications. They both received Office Actions for various reasons, but one requirement the Examining Attorney made in both was that defendant clarify whether the name in the mark identifies a living individual. If so, that individual's consent would need to be obtained and entered as part of the examination record. We can only surmise that defendant did not believe he could obtain Trudeau's consent since defendant never responded to these Office Actions and the marks were subsequently abandoned.]
Trudeau's Summary Judgment Motion
After analyzing and denying defendant's final two summary judgment arguments based on Trudeau's cyberpiracy and publicity claims, the Court next turned to Trudeau's motion for summary judgment. The only point here worth mentioning pertains to defendant's counterclaim of acquiescence. In granting summary judgment for Trudeau, the Court correctly held that acquiescence should be pled as an affirmative defense to a trademark claim, not as a counterclaim. Does this mean that defendant will not be able to use this defense (assuming he did not plead acquiescence as an affirmative defense), or will the Court allow such an amendment to the pleadings at this point in the litigation?
All in all, this was a victory for Trudeau. It will be interesting to see if this case ever makes it to trial, or, more likely, settles in the upcoming weeks/months.
Comment: In analyzing Trudeau's trademark infringement claim, the Court refers to 15 U.S.C. 1125. This section of the Lanham Act, also known as Section 43, deals primarily with false advertising, unfair competition, dilution and, of course, cybersquatting. However, straight trademark infringement claims based on a plaintiff's ownership of a federal registration should be analyzed under Section 32 of the Lanham Act. Since, according to USPTO records, Trudeau did not possess any federal registrations for TRUDEAU-formative marks, is it a misnomer to label this claim as "trademark infringement"?
Trudeau v. Lanoue, (Slip. Op.) 2006 WL 516579 (N.D. Ill., March 2, 2006)
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