The Sticker Hits The Fan . . . But It’s Not Infringement

Posted on | June 24, 2008 | No Comments

2008-1419 Minka Lighting v. Reliance Lighting
CD/CA 05-CV-1015
Judge Florence-Marie Cooper

Plaintiffs Minka Lighting and Jen-Lung David Tai (collectively, "Minka") appeal from Judge Florence-Marie Cooper’s grant of summary judgment in favor of defendant Aloha Housewares Co., Ltd. ("Aloha").  Judge Cooper also entered a stipulated judgment for damages and a permanent injunction against Reliance Lighting, Inc. ("Reliance"). 

Minka manufactures and sells various home products, including the popular Concept II ceiling fan that was the subject of this dispute.  The Concept II embodies several patents covering ceiling fan designs (D478,974 and  D478,654) and a blade assembly (6,059,531). 

In 2005, Minka filed suit against numerous defendants for patent, copyright, trademark, and trade dress infringement, federal, state, and common law unfair competition, state and common law false advertising, and civil conspiracy.  By the time summary judgment rolled around, however, most of the defendants had been dismissed through a mix of settlements and jurisdictional issues.  That left Aloha as the sole defendant twisting in the (fan made) wind–and spurred a hunt for the source of Aloha’s "UL Listed" stickers that would have made Carmen Sandiego proud. 

Judge Cooper’s summary judgment opinion lays out the saga of the Concept II fan, Reliance’s infringing Impress fan, and a Taiwanese company that somehow (honestly, it’s still not clear) got caught in the middle.   

Act I: The Impress

As Judge Cooper explained, Reliance (United States) triggered this dispute when it contacted Blue Sky Global (India) to manufacture a ceiling fan based on Minka’s Concept II to be sold under the name Impress.  Reliance sent Blue Sky Global a picture of the fan it wanted–labeled "Minka"–and a sample Concept II fan.  Blue Sky Global, in turn, hired Air Pro (China) to manufacture the infringing fan.  At Reliance’s request, "[Blue Sky Global] and Air Pro agreed to manufacture the fan as nearly identical to the sample as possible."  Reliance also sent the Concept II’s packaging to Blue Sky Global and directed it to "ensure that the Impress packaging mimic the Concept II packaging."  When Blue Sky Global became concerned about infringement (after making approximately 1,400 fans), it stopped supplying the Impress.   

Minka eventually recovered several Impress fans through various
settlement agreements and inspected them.  Each had holographic Underwriters Laboratories (UL) labels with the same control number.  Because UL
control numbers are unique to specific manufacturers, Minka was able to
identify the infringing manufacturer–or so it thought.  According to UL records, the control number on the Impress fans belonged to Aloha (Taiwan).  For those counting at home, that’s four countries for potential discovery jaunts–sounds like a fun case.   

Act II:  Stickergate

Not wanting to miss out on the fun, UL began an investigation (including a trip to Aloha’s manufacturer in China) to determine if the "UL Listed" tags were lost, stolen, or sold by Aloha.  They found no such evidence; the UL stickers in question were subject to security controls–even Aloha’s orders to the UL label maker in Illinois seemed to check out.  Further, Aloha’s CEO testified that his company had never done business with Reliance, Blue Sky Global, or Air Pro. 

Act III:  Summary Judgment

After extensive briefing, extended discovery, and a hearing on the issues, Judge Cooper ruled that Minka could not prove that Aloha was the source of the fans–or even the mounting plates bearing Aloha’s UL stickers.  Minka argued that Aloha was the source of the UL labels, therefore, it must at least manufacture the Impress mounting plates bearing those labels.  By Minka’s logic, Aloha’s accurate accounting of UL labels only helped its case: "the only possible way the [Aloha UL labels] could have been placed on the IMPRESS fans is with Aloha’s knowledge and consent." 

Judge Cooper disagreed, summarizing Minka’s chain of logic:

Plaintiffs’ conclusion . . . can only be reached by inferring, from the presence of the UL label on the Impress ceiling fan, (1) that Aloha Taiwan supplied the label, (2) because Aloha Taiwan supplied the label, it must have manufactured the mounting plate to which the label was affixed, (3) because Aloha Taiwan manufactured the mounting plate, it must have copied it directly from the Concept II’s marked mounting plate, and (4) because Aloha Taiwan copied the marked mounting plate, Aloha Taiwan was aware or should have been aware of Plaintiffs’ patents.

In the context of summary judgment, Minka’s argument had at least two leaps in logic too many for Judge Cooper: 

The first inference is of the kind properly made when considering circumstantial evidence. However, the second and third inferences, based loosely on the first inference and without additional supporting evidence, are speculative.  Plaintiff’s conclusion drawn from these inferences is therefore not “sufficiently unambiguous” to withstand summary judgment.

Epilogue

Judge Cooper’s opinion points out an interesting gap in an otherwise detailed fact record:  Minka never sought discovery from or presented evidence about Air Pro, the Chinese manufacturer of the Impress fan.  Straining to solve the unsolvable the Court pondered:

How, then, did authentic UL labels end up on the Impress fan? Maybe Aloha Taiwan manufactured the fans in its facility, despite evidence to the contrary.  Maybe Aloha Taiwan, while not manufacturing the fans itself, sold its UL labels to the company that did (again, despite evidence to the contrary).   Maybe The Label Printer printed more than one million labels, and some of the excess fell into the hands of Air Pro.  Plaintiffs have produced no evidence from Air Pro to explain the provenance of the labels.  As Aloha Taiwan points out, “[b]ecause Plaintiffs did not . . . take any discovery regarding Air Pro, or . . . introduce any evidence whatsoever regarding how AirPro obtained the UL labels, the details regarding Air Pro will remain a mystery even if a trial occurs.”

More Reading

Judge Cooper’s Summary Judgment Opinion

Counsel

For Minka: Baker & McKenzie, Dallas, TX (Lisa H. Meyerhoff), San Diego, CA (Shannon D. Sweeney) and Houston, TX (Myall S. Hawkins, Todd Y. Brandt, and Valerie K. Friedrich)

For Aloha: Haynes & Boone, Dallas, TX (Phillip B. Philbin)

For Reliance:  Bracewell & Guiliani, Dallas, TX (Michael D. Pegues)

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