Marketquest Group, Inc. v. Societe Bic, S.A. et al

Filing 404

ORDER denying Defendant BIC Corporation's 219 Daubert Motion to Exclude Opinions of Non-Retained Experts. Signed by Judge Cynthia Bashant on 4/12/2018. (jah)

1
2
3
4
5
6
7
8
9
10

UNITED STATES DISTRICT COURT

11

SOUTHERN DISTRICT OF CALIFORNIA

12

MARKETQUEST GROUP, INC.,

13

Case No. 11-cv-618-BAS-JLB

Plaintiff,

14

ORDER DENYING
DEFENDANT’S DAUBERT
MOTION TO EXCLUDE
OPINIONS OF NON-RETAINED
EXPERTS

v.

15

BIC CORPORATION, et al.,

16

[ECF No. 219]

Defendants.

17
18
19

Presently before the Court is BIC’s Motion to Exclude the Opinions of six non-

20

retained experts. (ECF No. 219). BIC argues that these opinions: (1) improperly

21

opine on an ultimate issue in the case; (2) have no reliable factual basis or standard

22

analysis methodology; and (3) are offered by experts without producing expert

23

witness reports. (ECF No. 219). Marketquest opposes. (Opp’n, ECF No. 262.) The

24

Court finds this motion suitable for determination on the papers submitted and

25

without oral argument. See FED. R. CIV. P. 78(b); S.D. CAL. CIV. L.R. 7.1(d)(1). For

26

the following reasons, the Court DENIES BIC’s motion.

27

I.

28

BACKGROUND
On March 28, 2001, Plaintiff Marketquest Group, Inc. (“Marketquest”) filed
–1–

11cv618

1

this action for trademark infringement and unfair competition against Defendants

2

BIC Corp., BIC USA, and Norwood Promotional Products (“BIC”). (ECF No. 1.)

3

On May 5, 2011, Marketquest filed the operative First Amended Complaint (“FAC”)

4

(ECF No. 14.) On May 13, 2011, BIC filed its Answer and Counterclaims. (ECF

5

No. 17.)

6

Marketquest is a California “supplier” that produces, advertises and sells

7

customizable promotional products using the registered trademarks “ALL-IN-ONE”

8

and “The Write Choice.” (FAC ¶¶10–12.) BIC is one of the largest suppliers in the

9

promotional products industry. (Marketquest’s Mot. Partial Summ. J. 1:12-2:7, ECF

10

No. 205.)

The promotional products industry supports the manufacture and

11

distribution of promotional products to companies (“end consumers”) who want to

12

brand themselves with customers. (Marketquest’s Mot. 1:16–18.) When a company

13

wants to brand itself with its customers, it approaches a promotional products

14

“distributor.” (Id. 1:19–21.) The distributor then approaches a supplier (such as

15

Marketquest or BIC) who either manufactures or imports a promotional product on

16

which the end consumer’s brand is imprinted.

17

Marketquest, such segregation of suppliers, distributors and end consumers is an

18

integral part of the industry and never bypassed. (Id. 2:1–3.)

(Id. 1:21–23.)

According to

19

Marketquest alleges BIC began advertising and selling products using marks

20

similar to Marketquest’s. (FAC ¶¶21–25.) Specifically, Marketquest claims BIC

21

used the phrase “The Write Pen Choice” in an online advertising campaign for

22

writing instruments beginning in October 2010. (Id. ¶23.) Around the same time,

23

Norwood Promotional Products, LLC, a subsidiary of BIC USA, printed a 2011

24

catalog entitled the “NORWOOD All in ONE” catalog. (Id. ¶24.) Alleging a form

25

of reverse confusion, Marketquest argues that BIC’s use of its marks to compete with

26

it in selling the same products—to the same customers in the same advertising

27

channels—in combination with BIC’s reputation as a brand aggregator, caused

28

confusion among customers. (Marketquest’s Mot. Partial Summ J. 4:14–18.)
–2–

11cv618

1

Marketquest lists six non-retained witnesses in three categories to testify to

2

various opinions at trial: Marketquest principals Harris Cohen (President) and Karen

3

Cohen (Executive Vice President); executives of distributor customers shared by the

4

parties Marvin Mittleman of Pro Specialties and Linda Neumann of Brilliant

5

Marketing Ideas; and executives of two promotional product trade organizations

6

Matthew Cohn (Vice Chairman of Advertising Specialty Institute (“ASI”) and Paul

7

Bellantone of Promotional Products Association International (“PPAI”). The six

8

non-retained witnesses are proffered to testify about the makeup of the promotional

9

products industry, the characteristics of suppliers and distributors, and the use and

10

importance of catalogues in the promotional products industry.

11

Specifically, BIC objects to their opinions that: (1) Marketquest’s name,

12

trademarks and brands are well-recognized in the promotional products industry; (2)

13

a company’s name and brand are critical to success in the industry; (3) BIC’s use of

14

“Norwood All in One” and “The Write Pen Choice” was confusing in the industry;

15

(4) most distributors in the industry are unsophisticated; (5) BIC’s use of “Norwood

16

All in One” and “The Write Pen Choice” created confusion that Norwood

17

Promotional Products had acquired or was affiliated with Marketquest, which was

18

damaging to a small company like Marketquest; and (6) the promotional products

19

industry experienced growth in 2006–08, decline in 2008–09 and began to recover in

20

2011. (ECF No. 219).

21

II.

DISCUSSION

22

BIC seeks exclusion of the opinions of the non-retained experts on the grounds

23

that the opinions: (1) improperly opine on an ultimate issue in the case; (2) have no

24

reliable factual basis or standard analysis methodology; and (3) are offered by experts

25

without producing expert witness reports. (ECF No. 219). Marketquest opposed.

26

(Opp’n, ECF No. 269.) Without addressing whether having all six witnesses testify

27

to the same opinions might be cumulative, the Court finds none of these arguments

28

has merit.
–3–

11cv618

1

A.

Ultimate Issue

2

BIC claims the testimony about the likelihood of confusion is an attempt to tell

3

the jury what decision to reach and embrace legal conclusions that are inadmissible.

4

“An opinion is not objectionable just because it embraces an ultimate issue.” FED.

5

R. EVID. 704. Rather, opinions should be admitted when they are helpful to the trier

6

of fact. See FED. R. EVID. 704, Adv. Comm. Note. Experts may not, however, offer

7

opinions embodying legal conclusions. See id. (clarifying Rule 704 as not permitting

8

“the admission of opinions which would merely tell the jury what result to reach”).

9

In analyzing whether there is a likelihood of confusion, a jury must first

10

consider the Sleekcraft factors and, based thereon, decide whether a likelihood of

11

confusion exists. See AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348 (9th Cir.

12

1979), abrogated on other grounds by Mattel, Inc. v. Walking Mountain Productions,

13

353 F.3d 792 (9th Cir. 2003); see also Alpha Indus., Inc. v. Alpha Steel Tube &

14

Shapes, Inc., 616 F.2d 440, 443 (9th Cir. 1980). “With the analysis so structured, . .

15

. the determination of what is the state of affairs regarding each factor (a

16

‘foundational fact’) is a finding of fact . . . but the further determination of likelihood

17

of confusion based on those factors is a legal conclusion. Alpha Indus., Inc., 616

18

F.2d at 443–44 (citing J. B. Williams Co. Inc. v. Le Conte Cosmetics, Inc., 523 F.2d

19

187, 191–92 (9th Cir. 1975), cert. denied 424 U.S. 913 (1976); Sleekcraft Boats, 599

20

F.2d at 348). Thus, courts distinguish between permissible expert opinions on the

21

individual Sleekcraft factors from impermissible testimony amounting to legal

22

conclusions on whether there is or is not a likelihood of confusion. See Playboy

23

Enters. v. Terri Welles, Inc., 78 F. Supp. 2d 1066, 1082 (S.D. Cal. 1999), aff’d in

24

part, rev’d in part on other grounds 279 F.3d 796 (9th Cir. 2002); see also YKK Corp.

25

v. Jungwoo Zipper Co., 213 F. Supp. 2d 1195, 1203 (C.D. Cal. 2002) (“[T]he Court

26

will not consider Anson’s legal conclusions, although his opinions on the individual

27

foundational facts, i.e. the individual Sleekcraft factors are admissible and will be

28

considered”). Provided a proper foundation is laid and the expert has the requisite
–4–

11cv618

1

experience, “[e]xpert testimony on the factors that go into the ultimate finding on the

2

confusion issue is generally quite proper and helpful to both judge and jury.” 4 J.

3

THOMAS MCCARTHY, MCCARTHY

4

§23:2.75 (5th ed. 2018).

ON

TRADEMARKS & UNFAIR COMPETITION

5

In this case, Marketquest offers executives familiar with the promotional

6

products industry to testify about the strength of Marketquest’s name, trademark and

7

brand; the marketing channels used by both Marketquest and BIC; the degree of care

8

likely to be exercised by the distributors who purchase products from suppliers like

9

Marketquest and BIC; and evidence that there was actual confusion in this area

10

caused by BIC’s use of the words trademarked by Marketquest. Testimony about

11

these Sleekcraft factors is absolutely proper. Although the witnesses may not testify

12

that these factors caused a legal “likelihood of confusion,” they may testify that the

13

use of the similar marks was actually confusing and created confusion.

14

B.

Reliable Factual Basis of Standard Analysis Methodology

15

BIC argues that the testimony by the non-retained experts is not based on

16

sufficient facts or data. (Mot. at 10.) However, the non-retained witnesses at issue

17

are testifying based on their knowledge and experience in the promotional products

18

industry rather than any methodology or theory behind the testimony. In such cases,

19

“Daubert factors for determining the admissibility of expert testimony, such as peer

20

review, publication, and potential error rate are not applicable . . .” United States v.

21

Hankey, 203 F.3d 1160, 1169 (9th Cir. 2000); see also Metavante Corp. v. Emigrant

22

Sav. Bank, 619 F.3d 748, 761 (7th Cir. 2010) (“[A]n expert’s testimony is not

23

unreliable simply because it is founded on his experience rather than on data; indeed,

24

Rule 702 allows a witness to be ‘qualified as an expert by knowledge, skill,

25

experience, training or education.’ FED. R. EVID. 702.” (emphasis in original)). In

26

this case, the non-retained experts will be offering testimony based on their personal

27

experience in the industry, and the testimony meets the minimum standards of

28

admissibility. Concerns with reliability are more appropriately considered with
–5–

11cv618

1

respect to the weight given to the testimony. See Thermolife Int’l LLC v. Myogenix

2

Corp., No. 13-cv-651 JLS (MDD), 2016 WL 3952128, at *3 (S.D. Cal. July 22,

3

2016); Metavante, 619 F.3d at 762 (“[d]eterminations on admissibility should not

4

supplant the adversarial process; shaky expert testimony may be admissible,

5

assailable by its opponents through cross-examination.”) (quotations omitted).

6

C.

Lack of Expert Witness Reports

7

Rule 26(a)(2)(B) requires disclosure of an expert witness report “if the witness

8

is one retained or specially employed to provide expert testimony in the case or one

9

whose duties as the party’s employee regularly involve giving expert testimony.”

10

FED. R. CIV. P. 26(a)(2)(B). BIC argues that all six of the non-retained expert

11

witnesses should be excluded for failure to submit an expert report in keeping with

12

this subsection.

13

“Every witness offering [expert] testimony . . . is not ‘retained or specially

14

employed to provide expert testimony.’” Wreath v. United States, 161 F.R.D. 448,

15

450 (D. Kan. 1995). The issue arises most frequently in the context of a treating

16

physician. To the extent such a physician “testified only as to the care and treatment

17

of his/her patient, the physician is not to be considered a specially retained expert

18

notwithstanding that the witness may offer [expert] opinion testimony.”

19

“However, when the physician’s proposed opinion testimony extends beyond the

20

facts made known to him [or her] during the course of the care and treatment of the

21

patient and the witness is specially retained to develop specific opinion testimony,

22

[that witness] becomes subject to the provisions of Fed. R. Civ. P. 26(a)(2)(B).” Id.

23

“The determinative issue is the scope of the proposed testimony. For example, a

24

treating physician requested to review medical records of another health care

25

provider in order to render opinion testimony concerning the appropriateness of the

26

care and treatment of that provider would be specially retained notwithstanding that

27

he [or she] also happens to be the treating physician.” Id.

28

Id.

Applying those rules to the witnesses proffered in this case, the Court turns
–6–

11cv618

1

first to the President and Vice President of Marketquest. There is no information that

2

these employees are ones whose duties regularly require them to give expert

3

testimony. They may testify as to the Marketquest name, trademarks and brands in

4

the promotional products industry and their belief that this name and brand are critical

5

to the success of their company. They may also testify about how the promotional

6

products industry is structured and the use and importance of catalogues in the

7

promotional products industry. This testimony is simply information they have

8

learned as an employee of Marketquest and not in preparation for litigation in this

9

case. Thus, reports are not necessary.

10

With respect to the two customers of Marketquest and Norwood, these

11

individuals would similarly be testifying based on their experience in the industry.

12

They may testify about Marketquest brands, structure of the industry, importance of

13

catalogues and any confusion they suffered or witnessed from use of the All-in-One

14

and Write Choice marks. They may also testify about their experience with respect

15

to the characteristics, specifically the relative sophistication, of suppliers and

16

distributors in the industry. None of this requires work that was specially prepared

17

for this case.

18

Additionally, the executives of two promotional product trade organizations

19

may testify about similar issues. None of these witnesses was asked to do research

20

or review records to testify.

21

conjunction with their employment.

Any records they reviewed were ones done in

22

Finally, the non-retained experts may testify about their experience with the

23

promotional products industry and its growth and decline during the 2006–2011

24

period. This is information they learned in their employment and did not gather in

25

preparation for litigation in this case. Hence, no expert witness report is required

26

under Rule 26(a)(2)(B).

27

III.

28

CONCLUSION & ORDER
For the foregoing reasons, Defendant’s Motion to Exclude the Opinions of
–7–

11cv618

1
2
3

Non-Retained Experts (ECF No. 219) is DENIED.
IT IS SO ORDERED.
DATED: April 12, 2018

4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
–8–

11cv618