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Slingmax, Inc. v. Marcal Rope & Rigging, Inc.

United States District Court, E.D. Missouri, Eastern Division

August 1, 2016

SLINGMAX, INC., Plaintiff,
v.
MARCAL ROPE & RIGGING, INC., et al., Defendants.

          MEMORANDUM AND ORDER

          CHARLES A. SHAW UNITED STATES DISTRICT JUDGE

         This matter is before the Court on plaintiff/counterclaim defendant Slingmax, Inc.’s (“Slingmax”) motion to dismiss the amended counterclaims of defendant/counterclaim plaintiffs Marcal Rope & Rigging, Inc. and Marcal Lifting Products Co. (collectively “Marcal”), pursuant to Rule 12(b)(6), Federal Rules of Civil Procedure, for failure to state a claim upon which relief can be granted. Marcal opposes the motion and it is fully briefed. For the following reasons, the Court will grant the motion to dismiss.

         I. Background

         This is an action for federal trademark infringement under 15 U.S.C. § 1114, trademark counterfeiting under 15 U.S.C. § 1114(1)(a), and false designation of origin and unfair competition under 15 U.S.C. § 1125. Plaintiff/counterclaim defendant Slingmax alleges that it is “a leader in the rigging and overhead lifting industry, particularly with respect to synthetic slings for heavy lifting and rigging.” Complaint, ¶ 8. Slingmax alleges that it has used the name and mark COVERMAX® for its abrasion-resistant covers for synthetic slings since December 1997, and was issued U.S. Trademark Registration No. 3, 183, 055 for the mark on December 12, 2006. Id., ¶¶ 12, 16. Slingmax alleges that in January 2006, Marcal became a licensee of its intellectual property, including the non-exclusive right to use Slingmax’s “CoverMax™ Sleeves” mark, among other Slingmax marks, but as early as the second quarter of 2006, this license was revoked. Id., ¶¶ 13-14.

         Slingmax alleges that defendants/counterclaim plaintiffs Marcal also sell a range of rigging and construction products, including synthetic slings for lifting heavy loads, and sells slings with abrasion-resistant covers for synthetic slings that bear the spurious name “COVERMAX.” Id., ¶¶ 19-20. Slingmax alleges that Marcal’s slings do not incorporate a genuine cover fabricated by Slingmax, Marcal is not authorized to use the COVERMAX® mark, and Marcal’s slings are inferior to those of Slingmax but Marcal is holding them out to the relevant public as identical or closely comparable to Slingmax’s. Id., ¶¶ 21-22. Slingmax alleges that Marcal’s use of the COVERMAX® name is likely to cause customer confusion and infringes on its federally protected rights in the mark.

         Defendants/counterclaim plaintiffs Marcal answered the complaint and filed three counterclaims. In Count I, Marcal seeks declaratory judgment that the COVERMAX® mark is unenforceable and/or that Marcal’s alleged use of the mark is non-infringing because the mark is or has become generic. In Count II, Marcal seeks declaratory judgment that Slingmax has abandoned trademark use of the COVERMAX® mark. In Count III, Marcel seeks cancellation of the COVERMAX® mark because it is or has become generic and because it has been abandoned.

         Slingmax moves for dismissal of Marcal’s counterclaims for failure to state a claim on which relief can be granted.

         II. Legal Standard

         The purpose of a motion to dismiss for failure to state a claim is to test the legal sufficiency of the complaint. To survive a motion to dismiss pursuant to Rule 12(b)(6) for failure to state a claim upon which relief can be granted, “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim for relief “must include sufficient factual information to provide the ‘grounds’ on which the claim rests, and to raise a right to relief above a speculative level.” Schaaf v. Residential Funding Corp., 517 F.3d 544, 549 (8th Cir. 2008) (citing Twombly, 550 U.S. at 555 & n.3). This obligation requires a plaintiff to plead “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555.

         On a motion to dismiss, the Court accepts as true all of the factual allegations contained in the complaint, even if it appears that “actual proof of those facts is improbable, ” id. at 556, and reviews the complaint to determine whether its allegations show that the pleader is entitled to relief. Id. at 555-56; Fed.R.Civ.P. 8(a)(2). The principle that a court must accept as true all of the allegations contained in a complaint does not apply to legal conclusions, however. Iqbal, 556 U.S. at 678 (“Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice”).

         “While courts primarily consider the allegations in the complaint in determining whether to grant a Rule 12(b)(6) motion, courts additionally consider ‘matters incorporated by reference or integral to the claim, items subject to judicial notice, matters of public record, orders, items appearing in the record of the case, and exhibits attached to the complaint whose authenticity is unquestioned;’ without converting the motion into one for summary judgment.” Miller v. Redwood Toxicology Lab, Inc., 688 F.3d 928, 931 & n.3 (8th Cir. 2012) (quoting 5B Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1357 (3d ed. 2004)).

         III. Discussion

         A. Claim for Fair Use

         Count I of Marcal’s counterclaim seeks in part a “judicial declaration that Defendants’ alleged use of COVERMAX is a fair use.” (Doc. 21, ¶ 12.) Slingmax asserts that Count I fails to state a claim and should be dismissed to the extent it seeks a declaration of fair use, as fair use is an affirmative defense to trademark infringement and not its own cause of action, citing KP Permanent Make Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111, 118 (2004). Slingmax states that fair use is defined as party’s use of a trademark as a “term or device which is descriptive of and used fairly and in good faith only to describe the goods or services of such party[, ]” 15 U.S.C. § 1115(b)(4), and might permit others to use a protected mark to describe aspects of their own goods, Car-Freshner Corp. v. S.C. Johnson & Son, Inc., 70 F.3d 267, 270 (2d Cir. 1995), or to comment upon ...


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