Uncommon, LLC v. Spigen, Inc.
MEMORANDUM Opinion and Order Signed by the Honorable John Robert Blakey on 7/26/2016. Mailed notice(gel, )
UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
Case No. 15 C 10897
Judge John Robert Blakey
MEMORANDUM OPINION AND ORDER
Plaintiff, Uncommon, LLC, has sued Defendant, Spigen, Inc., alleging
trademark infringement in violation of the Lanham Act and unfair competition in
violation of both the Lanham Act and Illinois common law. 1
Uncommon’s complaint and, along with its answer, asserted ten affirmative
defenses and a six-count counterclaim. Currently before the court is Uncommon’s
motion to dismiss Counts II and V of Spigen’s counterclaim and to strike all ten
affirmative defenses. The Court grants the motion to dismiss Counts II and V, and
grants in part, and denies in part, the motion to strike the affirmative defenses.
In its complaint, Uncommon alleged that it owns a federal registration with
the U.S. Patent and Trademark Office (“USPTO”) for its CAPSULE trademark
(Reg. No. 4,338,254). Complaint , ¶ 2. The mark, which specifies its use for cases
These claims are asserted, respectively, in Count I (infringement) and Counts II and III (unfair
competition). Plaintiff’s initial complaint also included claims seeking cancellation of Defendant’s
application for the “Air Capsule” mark (Count IV) and the “Capsule Solid” mark (Count V). See ,
¶¶ 56-65. Plaintiff voluntarily dismissed the cancellation claims on January 29, 2016. See .
specifically adapted for protection and storage of consumer electronics, namely,
cellular phones and mobile media players, in Class 9 (U.S. CLS 21, 23, 26, 36 and
38), was registered on May 21, 2013, and claimed a “first use” date of December 16,
2009. See , ¶ 17 and Exhibit A. Uncommon alleges that Spigen, which is a direct
competitor of Uncommon, has intentionally copied the CAPSULE mark. Id., ¶¶24,
30-31. Uncommon alleges that Spigen filed an intent-to-use trademark application
on November 25, 2014, for “AIR CAPSULE” in Class 9; and it also filed a trademark
application on October 5, 2015 for “CAPSULE SOLID” in Class 9 on October 5,
2015. Id., ¶¶34-35. These applications remain pending. Id.
On February 12, 2016, Spigen answered the complaint, claiming that it
lacked sufficient information or knowledge to admit or deny the allegations
concerning Uncommon’s registration of the CAPSULE mark. See Answer , ¶¶ 2,
Spigen admitted that it promotes and sells protective cases for electronic
devices, including those containing the term “Capsule.” Id., ¶¶ 23-26. In its first
responsive pleading, Spigen asserted fifteen affirmative defenses (in a single
sentence each): (1) failure to state a claim; (2) continuous prior use; (3) continuous
prior use before registration; (4) waiver, acquiescence, estoppel; (5) laches; (6)
abandonment; (7) failure to mitigate; (8) acts of Plaintiff; (9) no equitable relief; (10)
no willful infringement; (11) third party use; (12) actions of others; (13) lack of
causation; (14) lack of damages; and (15) a catchall defense entitled “all remaining
defenses.” See Affirmative Defenses , ¶¶ 1-15.
For its initial counterclaim, Spigen sought cancellation of the “CAPSULE”
mark based upon fraud in the procurement of the registration (Count I);
cancellation of the “CAPSULE” mark based upon prior registration by Vatra and/or
Senior use of SwitchEasy (Count II); cancellation of the “CAPSULE” mark based
upon the mark being merely descriptive with no secondary meaning (Count III); a
declaratory judgment of noninfringment of the “CAPSULE” mark (Count IV); a
declaratory judgment of lack of protectable or enforceable trademark (Count V); a
declaratory judgment granting concurrent use right to Spigen (Count VI) and
damages under 15 U.S.C. § 1120 (Count VII). See Counterclaim .
Uncommon moved to dismiss Spigen’s counterclaim and strike its affirmative
In response, Spigen filed an amended pleading, knocking its
affirmative defenses down to ten (it deleted those asserting failure to state a claim;
no equitable relief; no willful infringement; lack of causation; and lack of damages),
and adding a claim seeking cancellation of the “CAPSULE” mark based upon
genericness (amended Count III). See First Amended Answer, Affirmative Defenses
and Counterclaim , ¶¶ 42-48.
Spigen also dropped two of its declaratory
judgment claims – former Count IV, which sought a declaratory judgment of
noninfringment of the “CAPSULE” mark, and former Count V, which sought a
declaratory judgment of lack of protectable or enforceable trademark. See .
Uncommon again moved to dismiss. This time, Uncommon sought dismissal
of Counts I, II, V and VI of Spigen’s amended counterclaim; and it again moved to
strike all of Spigen’s affirmative defenses. See . In response, Spigen voluntarily
dismissed Counts I and VI of its amended counterclaim. See . Thus, before the
Court is Uncommon’s motion to dismiss Counts II and V of Spigen’s amended
counterclaim and to strike Spigen’s ten affirmative defenses. Uncommon does not
seek to dismiss Counts III and IV, which seek cancellation of the CAPSULE mark
based upon genericness (Count III) and based on the mark being merely descriptive
and having no secondary meaning (Count IV).
Uncommon has moved to dismiss Counts II and V of Spigen’s counterclaim
for failure to state a claim. A motion to dismiss under Rule 12(b)(6) “challenges the
sufficiency of the complaint for failure to state a claim upon which relief may be
granted.” Gen. Elec. Capital Corp. v. Lease Resolution Corp., 128 F.3d 1074, 1080
(7th Cir. 1997). To survive a motion to dismiss, a complaint must contain “sufficient
factual matter” to “state a claim to relief that is plausible on its face.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544,
556, 570 (2007)). A claim has facial plausibility “when the plaintiff pleads factual
content that allows the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Id. The plausibility standard “is not akin to a
‘probability requirement,’ but it asks for more than a sheer possibility that a
defendant has acted unlawfully.” Id. In making this determination, the Court
accepts all well-pleaded allegations in the complaint as true and draws all
reasonable inferences in favor of the plaintiff. Id. When considering a motion to
dismiss under Rule 12(b)(6), this Court must construe Spigen’s allegations in the
light most favorable to Spigen, accept as true all well-pleaded facts and draw
reasonable inferences in Spigen’s favor. Yeftich v. Navistar, Inc., 722 F.3d 911, 915
(7th Cir. 2013); Long v. Shorebank Development Corp., 182 F.3d 548, 554 (7th Cir.
1999). Statements of law, however, need not be accepted true. Id.
Counterclaims are treated the same as claims for purposes of Fed. R. Civ. P.
8 and 9. Telefonix, Inc. v. Response Engineering, Inc., No. 12 C 4362, 2012 WL
5499437 (N.D. Ill. Nov. 13, 2012).
Thus, to survive a motion to dismiss, a
counterclaim must “state a claim for relief that is plausible on its face.” Bell Atlantic
Corp. v. Twombly, 550 U.S. 544, 547 (2007). “A claim has facial plausibility when
the plaintiff pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.” Yeftich v.
Navistar, Inc., 722 F.3d 911, 915 (7th Cir. 2013).
The Twombly and Iqbal standards also apply to affirmative defenses. Shield
Tech. Corp. v. Paradigm Positioning, LLC, No. 12 C 6183, 2012 WL 4120440, at *8
(N.D. Ill. Sept. 19, 2012). Thus, Spigen must plead its affirmative defenses with
“enough facts to state a claim for relief that is plausible on its face.” Twombly, 550
U.S. at 547. Further, “threadbare recitals of the elements of a cause of action,
supported by mere conclusory statements, do not suffice” for the pleading standard
of Rule 8. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). At the very least, affirmative
defenses must pass the pre-Twombly standard, where “bare bones conclusory
allegations,” bereft of factual context, are not sufficient to pass a motion to dismiss.
Heller Financial, Inc. v. Midwhey Powder Co., 883 F.2d 1286, 1295 (7th Cir. 1989).
Uncommon moves to dismiss Counts II and V of Spigen’s Counterclaim and
also moves to strike all ten of Spigen’s affirmative defenses. The Court considers
each issue below.
Count II: Cancelation Based Upon Prior and Senior Use
In Count II of its counterclaim, Spigen seeks cancellation of the “CAPSULE”
mark based upon prior registration by Vatra and/or senior use of SwitchEasy and/or
First Amended Counterclaim , ¶¶26-41.
In support of this claim,
Spigen alleges that Vatra, Inc., a non-party in this case, “applied for registration of
the mark “CAPSULE” (U.S. Registration No. 3,472,044) in connection with IC 009,
including cases for mobile phones and cases for telephones, on December 27, 2007”;
that Vatra’s “CAPSULE” mark (U.S. Registration No. 3,472,044) was published for
opposition on May 6, 2008 and registered on the principal register on July 22,
2008”; and that Vatra began using the “CAPSULE” mark “as early as September 1,
2007.” First Amended Counterclaim , ¶¶ 26-29. Spigen further alleges that
SwitchEasy “applied for registration of the mark “CAPSULE” (Ser. No. 77533218)
in connection with IC 009 protective cases and carrying cases for portable digital
media player devices on July 29, 2008, with a first date of use at [least] as early as
December 1, 2005.” Id., ¶ 30. Based upon these prior uses, Spigen asks the Court
to “exercise its authority and order the USPTO to cancel the “CAPSULE” Mark
(U.S. Registration No. 4,338,524). Id., ¶ 41.
It is not clear what statute Spigen seeks to invoke in Count II. But, to the
extent Spigen is seeking to assert a claim against Uncommon for infringement of
any registered trademark, the claim would fail. Spigen admits in its answer and
counterclaim that its Capsule-related applications remain pending; and Spigen
cannot assert a claim on behalf of Vatra, the only entity alleged to hold a previously
registered mark. See Jewelers Vigilance Comm., Inc. v. Ullenberg Corp., 853 F.2d
888, 891 (Fed. Cir. 1988); Otto Roth & Co., Inc. v. Universal Foods Corp., 640 F.2d
1317, 1320 (C.C.P.A. 1981). To prevail on a traditional trademark infringement
claim against an accused infringer, a plaintiff must show that it owns a protectable
Pure Imagination, Inc. v. Pure Imagination Studios, Inc., No. 03 C
6070, 2004 WL 2967446, at *4 (N.D. Ill. Nov. 15, 2004). Spigen has not alleged that
it owns or has proprietary rights in any mark that was previously registered or
It does allege that Vatra registered a mark before Uncommon and that
Uncommon’s use of its mark is likely to cause confusion with the Vatra mark. But
“[o]rdinarily, a person should not be heard on a third party’s rights” or be “allowed
to sue to vindicate the rights of another.” Jewelers Vigilance, 853 F.2d at 892.
Spigen cites Ritchie v. Simpson, 170 F.3d 1092, 1095 (Fed. Cir. 1999), for the
proposition that, even if it does not own the infringed mark, it need only possess a
“real interest” in the proceedings to sue for trademark infringement. The Ritchie
case, however, dealt with the issue of who can oppose a trademark registration at
the USPTO when the registration is pending. It does not address who can properly
sue in federal court for trademark infringement. In Central Manufacturing, Inc. v.
Brett, 492 F.3d 876, 881 (7th Cir. 2007), the Seventh Circuit held that an “action for
trademark infringement can only succeed if, among other things, the plaintiff owns
the mark.” Because Spigen does not own the mark registered to Vatra, it cannot
sue for trademark infringement on the basis of Vatra’s mark.
To the extent Spigen is attempting in Count II to seek relief under 15 U.S.C.
§ 1052(d), its claim would similarly fail. That statute provides that a mark is not
entitled to registration if it consists of or comprises a mark which “so resembles a
mark registered in the Patent and Trademark Office, or a mark or trade name
previously used in the United States by another and not abandoned, as to be likely,
when used on or in connection with the goods of the applicant, to cause confusion, or
to cause mistake, or to deceive.” This is not, however, the time or place to challenge
Uncommon’s registration. And, to the extent Spigen is arguing that Uncommon’s
registration should be cancelled because Spigen used the mark before Uncommon
did, that claim is not factually supported.
Uncommon argues that Count II should be dismissed because Spigen’s
allegation that it is a “senior user” is a threadbare legal conclusion. The party who
“first appropriates the mark through use” acquires “superior rights to it.” Kubota
Corp. v. Shreddheadline.com Company, Inc., No. 12 C 6065, 2013 W.L. 6096999 at
*5 (N.D. Ill. Nov. 20, 2013) (quoting Johnny Blastoff, Inc. v. Los Angeles Rams
Football Co., 188 F.3d 427, 434 (7th Cir. 1999)). To acquire rights to a trademark,
one must use it in commerce “in the ordinary course of trade.” Id. To prevail on any
infringement claim based upon senior use, Spigen would have to show that it first
appropriated the mark by making “use in commerce” before Uncommon. Specht v.
Google, 747 F.3d 949 (7th Cir. 2014) (deciding which parties had superior
trademark rights by determining who made first “use in commerce.”). If a party
uses a mark in commerce later in time, and the mark is “likely to cause confusion”
with the first user’s mark, then the party may be liable for trademark infringement.
15 U.S.C. § 1114(1)(a). Accordingly, a party’s status as a “senior user” is a legal
conclusion requiring factual proof. Simply alleging that you are the “senior user” of
the mark – without facts to explain the conclusion − is not enough. E.g., Drew
Estate Holding Co., LLC v. Fantasia Distribution, Inc., No. 11-21900-CIV, 2012 WL
864659, at *4 (S.D. Fla. Mar. 13, 2012). See also Yeftich v. Navistar, Inc., 722 F.3d
911, 915 (7th Cir. 2013) (at the motion to dismiss stage, statements of law need not
be accepted as true).
Here, Spigen alleges that it “is a senior user to Counter-Defendant in using
the mark ‘CAPSULE’.” Countercl. ¶ 39. But Spigen does not allege a date, a year or
any time period indicating when it first used the CAPSULE mark in commerce.
Spigen offers no facts establishing that it made first use of the mark in commerce,
and, as a result, its senior user allegation is conclusory and insufficient to support
any inference that Spigen has superior rights in the mark.
alleging superior rights to the CAPSULE mark, and supporting that allegation with
facts, Spigen cannot pursue a claim (whether for infringement or cancellation)
based upon senior use.
Spigen next argues that it may petition the Court to cancel Uncommon’s
mark by invoking 15 U.S.C. § 1119 of the Lanham Act, which provides: “In any
action involving a registered mark the court may determine the right to
registration, order the cancelation of registrations, in whole or in part, restore
canceled registrations, and otherwise rectify the register with respect to the
registrations of any party to the action.” 15 U.S.C. § 1119. Section 1119, however,
does not create an independent cause of action, but “merely defines certain
available remedies.” Thomas & Betts Corp. v. Panduit Corp., 48 F. Supp.2d 1088,
1093 (N.D. Ill. 1999).
Spigen argues that its purported prior use in a certain
geographical region justifies its request for cancellation. But that argument goes
against clearly established law: “[p]rior use of a trademark in a remote geographic”
area does “not justify the cancellation of a second user’s trademark rights acquired
in good faith.” V & V Food Products, Inc. v. Cacique Cheese Co., 683 F. Supp. 662,
666 (N.D. Ill. 1988) (citing United Drug Co. v. Theodore Rectanus Co., 248 U.S. 90,
100 (1918); Hanover Star Milling Co. v. Metcalf, 240 U.S. 403, 415 (1916).
In the absence of any authority recognizing a standalone cause of action for
cancelation based upon a third party’s prior use or registration, Spigen relies on
Central Manufacturing, Inc. v. Brett, 492 F.3d 876, 883 (7th Cir. 2007).
reliance, however, is misplaced. In that case, the trial court determined that the
plaintiff’s registered mark was invalid because it was not used in commerce and
then, having determined that the mark was invalid, used its discretionary power to
cancel the mark under 15 U.S.C. § 1119; the Seventh Circuit affirmed. But nothing
in Central Manufacturing suggests that a party may petition the court to cancel a
mark based solely on an allegation of prior use and without the predicate
determination of invalidity. For all of these reasons, Uncommon’s motion to dismiss
Count II of Spigen’s counterclaim is granted. 2
Count V: Declaratory Judgment Seeking Right to Concurrent Use
In Count V of its counterclaim, Spigen seeks a declaratory judgment granting
it the right to concurrent use of the “CAPSULE” mark.
Counterclaim , ¶¶ 56-59. Spigen alleges that, if Uncommon filed a trademark
application on September 17, 2012 representing that its date of first use was
This ruling does not affect Spigen’s efforts to seek cancelation based upon genericness (Count III)
and upon the mark being merely descriptive (Count IV). Uncommon has not moved to dismiss
Counts III and IV of Spigen’s counterclaim.
December 16, 2009, then Spigen’s use of the mark preceded Uncommon’s use of the
mark. Id. at ¶¶ 12-13, 16. Spigen alleges that it is entitled to a judicial declaration
finding that it has the right to use the mark in the geographical region where it
used the mark before Uncommon. Id. at ¶¶ 58-59.
Under the Lanham Act, someone using a mark prior to another’s use and
registration may continue to use in that area, even after the other registers. 15
U.S.C. § 1065. Although concurrent use in a geographic area may be a defense to
an infringement claim, these allegations do not give rise to an affirmative claim. In
fact, Spigen seeks no affirmative relief here, but seeks the denial of relief (or a
limitation on any relief awarded) to Uncommon.
As such, these allegations
constitute a defense, not a counterclaim. Burger King of Fla., Inc. v. Hoots, 403
F.2d 904, 907 (7th Cir. 1968); Pure Imagination, Inc. v. Pure Imagination Studios,
Inc., No. 03 C 6070, 2004 WL 2967446 (N.D. Ill. Nov. 15, 2004). Indeed, concurrent
use is one factor comprising the likelihood of confusion analysis the Court will
undertake in connection with Uncommon’s claims.
Tribune Co., 267 F.3d 628, 643, 646 (7th Cir. 2001).
E.g., Packman v, Chicago
Spigen has already pled
concurrent use as a defense to Uncommon’s claims, which is appropriate under the
Lanham Act, see 15 U.S.C. § 1115(b).
Thus, its claim seeking a declaratory
judgment action is redundant and is, therefore, dismissed.
See, e.g, Intercon
Solutions, Inc. v. Basel Action Network, 969 F. Supp. 2d 1026, 1065 (N.D. Ill. 2013),
aff'd, 791 F.3d 729 (7th Cir. 2015) (where “the substantive suit would resolve the
issues raised by the declaratory judgment action, the declaratory judgment action
‘serves no useful purpose’ because the controversy has ‘ripened’ and the uncertainty
and anticipation of litigation are alleviated.”) (quoting Amari v. Radio Spirits, Inc.,
219 F.Supp.2d 942, 944 (N.D. Ill. 2002); Tempco Elec. Heater Corp. v. Omega
Engineering, Inc., 819 F.2d 746, 749 (7th Cir. 1987)). Courts “routinely dismiss
counterclaims that seek to generate an independent piece of litigation out of issues
that are already at issue; this includes counterclaims that merely restate an
affirmative defense, as well as those which simply seek the opposite effect of the
complaint.” Id. (citing cases). The Court does so here as well. The motion to
dismiss Count V of Spigen’s amended counterclaim is granted.
Uncommon moves to strike all ten of Spigen’s affirmative defenses, arguing
that Spigen has not sufficiently pled any of them. Affirmative defenses will be
stricken “only when they are insufficient on the face of the pleadings.” Heller
Financial v. Midwhey Powder Co., 883 F.2d 1286, 1294 (7th Cir. 1989). Motions to
strike propose a drastic remedy and generally are not favored because they delay
proceedings; where, however, the motion seeks to remove “unnecessary clutter”
from the case, it will expedite − not delay − the proceedings and may be granted.
Id. An affirmative defense should not be stricken “unless it appears to a certainty
that plaintiffs would succeed despite any state of the facts which could be proved in
support of the defense.” Williams v. Jader Fuel Co., 944 F.2d 1388, 1400 (7th Cir.
1991). Ordinarily, defenses will “not be struck if they are sufficient as a matter of
law or if they present questions of law or fact.” Heller, 883 F.2d at 1294 (citing
United States v. 416.81 Acres of Land, 514 F.2d 627, 631 (7th Cir. 1975)). See also
Maurice Sporting Goods, Inc. v. BB Holdings, Inc., No. 15-cv-11652, 2016 WL
2733285 (N.D. Ill. May 11, 2016) (“[M]otions to strike are not favored and will not
be granted unless it appears to a certainty that plaintiffs would succeed despite any
state of the facts which could be proved in support of the defense, and are inferable
from the pleadings.”) (quoting Williams v. Jader Fuel Co., Inc., 944 F.2d 1388, 1400
(7th Cir. 1991)).
Here, Uncommon argues that Spigen’s affirmative defenses are improper and
fail to provide fair notice. In particular, Uncommon argues that each affirmative
defense is only one sentence long and contains no supporting facts. Read within the
context of Spigen’s answer and counterclaim, however, the defenses, for the most
part, pass muster. The Court addresses the exceptions below.
First, Spigen’s third and fourth affirmative defenses are inadequately pled
and must be stricken. Waiver and estoppel are among the enumerated defenses
that must be affirmatively pled. See Fed. R. Civ. P. 8(c). To properly assert an
estoppel defense, thereby giving adequate notice to the opposing party under Rule
8(c), three elements must be pleaded: (1) a party acts; (2) another party reasonably
relies on those acts; and (3) the latter party thereby changes his position for the
worse. Tome Engenharia E. Transportes, Ltd. v. Malki, No. 94 C 7427, 1996 WL
172286, at *11 (N.D. Ill. Apr. 11, 1996).
Spigen failed to plead any of these
elements, and none is readily discernible from Spigen’s answer. Therefore, Spigen’s
third affirmative defense is stricken without prejudice.
Similarly, Spigen’s fourth affirmative defense, laches, must be stricken.
Spigen asserts only that Uncommon’s “rights in the “CAPSULE” mark are
unenforceable, in whole or in part, against Spigen, under the doctrine of laches.”
, ¶4, p. 9.
There is nothing in the complaint or answer to suggest that
Uncommon was dilatory in bringing this action and, absent some additional factual
support, this statement fails to provide adequate notice of the basis of the defense.
Additionally, Spigen’s ninth and tenth affirmative defenses must be stricken
as they inject unnecessary clutter into the case. Spigen’s ninth affirmative defense
lacks any factual support and fails to provide fair notice.
It asserts that
Uncommon’s claims “are barred, in whole or in part, because Spigen is not liable for
the acts of other[s] over whom it has no control.” In response to the motion to
strike, Spigen argues that the defense means that Spigen “is disavowing they have
any control over any party other than itself.” Response, p. 10. But the complaint
does not allege liability based upon the actions of others.
Similarly, Spigen’s catchall tenth affirmative defense lacks any support and
must be stricken. Maurice Sporting Goods, Inc. v. BB Holdings, Inc., No. 15-CV11652, 2016 WL 2733285, at *2 (N.D. Ill. May 11, 2016); Davis v. Elite Mortgage
Servs., 592 F. Supp. 2d 1052, 1058 (N.D. Ill. 2009) (it is entirely appropriate for the
court “to strike affirmative defenses that add unnecessary clutter to a case.”) (citing
Heller, 883 F.2d at 1295). “[U]sing affirmative defenses as a reservation of rights is
improper and unnecessary.” Jones v. UPR Products, Inc., No. 14 C 1248, 2015 WL
3463367, at *2 (N.D. Ill. May 29, 2015); In re Ventra Card Litig., No. 13 CV 7294,
2015 WL 1843044, at *7 (N.D. Ill. Apr. 21, 2015).
The motion to strike is granted as to Spigen’s third, fourth, ninth and tenth
affirmative defenses, but is otherwise denied.
For the reasons explained above, Uncommon’s motion to dismiss Spigen’s
amended counterclaims and strike Spigen’s amended affirmative defenses  is
granted in part and denied in part. The motion is granted as to Counts II and V of
the counterclaim and as to Spigen’s third, fourth, ninth and tenth affirmative
defenses. The motion is otherwise denied.
Dated: July 26, 2016
Judge John Robert Blakey
United States District Judge
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