Mueller C o . v . US Pipe & Foundry CV-03-170-JD 01/22/04
UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF NEW HAMPSHIRE
Mueller C o . and
Mueller International, Inc.
v. Civil N o . 03-170-JD
Opinion N o . 2004 DNH 018
United States Pipe and Foundry C o .
O R D E R
The parties have cross-moved for judgment on the
pleadings on the counterclaim by defendant United States Pipe
and Foundry C o . (“U.S. Pipe”) for a declaratory judgment that
its design for a fire hydrant does not infringe any of the
plaintiffs’ “trade dress or other rights.” Each side objects
to the other’s motion.
Background
Both Mueller C o . (“Mueller”) and U.S. Pipe manufacture
fire hydrants. Mueller claims that its hydrants have a
distinctive trade dress, which includes certain fluting and
beading elements. The trade dress for these hydrants was
federally registered in 1996 by Mueller International, Inc.
(“MII”) and subsequently licensed to Mueller. The parties
agree that more than ninety-five percent of the 15,000
municipal water distribution systems in the nation specify or
approve the use of Mueller’s hydrants.
The plaintiffs allege that in March 2003, U.S. Pipe began
marketing a hydrant with a design “substantially similar to”
and “likely to be confused with” their hydrants. The
plaintiffs responded by commencing this action, which asserts
a variety of trademark and unfair competition claims. 1 They
also filed a motion for a preliminary injunction seeking to
prevent U.S. Pipe from selling the hydrant in question or any
other hydrant with an appearance confusingly similar to that
registered by M I I .
In its answer, U.S. Pipe admits that “the outer
appearance of the upper barrel” of a hydrant it displayed at a
March 2002, trade show is “physically similar” to that of a
hydrant sold by Mueller and referred to as the Centurion.
U.S. Pipe also acknowledges that it represented that the
components of its hydrant were interchangeable with those of
the Centurion. U.S. Pipe disclaims any “possible confusion as
to the source of [its] hydrant,” however, because the hydrant
“prominently and conspicuously bears the ‘U.S. Pipe’
inscription. . . .”
1
The court previously granted U.S. Pipe’s motion to
dismiss counts III and IX of the plaintiffs’ complaint.
Mueller C o . v . United States Pipe & Foundry C o . , 2003 DNH 1 6 8 ,
2003 WL 22272135 (D.N.H. Oct. 2 , 2 0 0 3 ) .
2
U.S. Pipe’s answer also includes a counterclaim against
the plaintiffs in three different counts, only the first of
which is at issue here. In support of this count, U.S. Pipe
avers that Mueller’s market dominance has caused most
municipalities to insist that their suppliers provide only
Mueller hydrants and replacement parts. U.S. Pipe therefore
alleges that it envisioned a hydrant which would be
interchangeable with the Centurion, and the replacement parts
of which would be interchangeable with Mueller’s. This
hydrant, displayed at the trade show, was designed to meet the
“narrowly drawn, Mueller-driven specifications adopted by most
municipalities . . . .” U.S. Pipe claims that it decided
to forego manufacturing this hydrant, however, after being
served with the complaint in this action. For their part, the
plaintiffs acknowledge in their reply to the counterclaim that
U.S. Pipe “represented that it would not continue producing”
the hydrant. Furthermore, on July 2 , 2003, the parties
jointly requested an order enjoining U.S. Pipe from selling
the hydrant “or any fire hydrant incorporating the fluting and
beading design elements of the [registered] trade dress”
during the pendency of this action. 2 The court issued this
2
This restriction limits activity in the United States
only.
3
order, which also effected a withdrawal of the plaintiffs’
motion for a preliminary injunction, on July 8 , 2003.
U.S. Pipe states in its counterclaim that it “opted
instead to effect a re-design” of the hydrant in a fashion
depicted in an exhibit to the counterclaim (the “redesigned
hydrant”). The plaintiffs admit that the hydrant pictured
“does not appear to have features that would be termed
‘beading’ or ‘fluting,’” but that they nevertheless objected
to the design. They dispute, however, U.S. Pipe’s
characterization of the basis of their objection. The
plaintiffs also deny U.S. Pipe’s allegations that the
redesigned hydrant does not infringe any of their federal or
common-law trademark rights, which U.S. Pipe makes in support
of its counterclaim for a declaratory judgment to that effect.
U.S. Pipe now moves for judgment on the pleadings on its
counterclaim on the ground that the plaintiffs have “not
asserted any counterclaim alleging that U.S. Pipe’s newly
designed fire hydrant infringes any of [their] intellectual
property rights” and that this “failure to assert such a
counterclaim precludes [the plaintiffs] from ever asserting it
in the future.” The plaintiffs explain that they did not seek
this relief because they did not know at the time they filed
their reply to the counterclaim that U.S. Pipe had yet “made,
4
marketed, or sold” the redesigned hydrant, as the counterclaim
does not contain any allegations to this effect. The
plaintiffs also cross-move for judgment on the pleadings on
the counterclaim on the ground that, in the absence of such
allegations, the issue of whether the redesigned hydrant
infringes the plaintiffs’ trademark rights is not ripe for
adjudication.
For reasons which will appear, the court will consider
the parties’ motions in reverse chronological order.
I. The Plaintiffs’ Motion for Judgment on the Pleadings
A challenge to a claim as unripe amounts to a motion to
dismiss for lack of subject matter jurisdiction. See Ernst &
Young, Inc. v . Depositors Econ. Prot. Corp., 45 F.3d 5 3 0 , 535
(1st Cir. 1 9 9 5 ) . Here, the plaintiffs have chosen to attack
the court’s subject matter jurisdiction facially, i.e.,
without submitting any evidentiary materials. See Valentin v .
Hosp. Bella Vista,
254 F.3d 3 5 8 , 363 (1st Cir. 2 0 0 1 ) ; 2 James
Wm. Moore e t . a l , Moore’s Federal Practice § 12.30[4] (3d ed.
2003). In resolving this challenge, the court must therefore
accept U.S. Pipe’s well-pleaded factual allegations as true
and draw all reasonable inferences from them in U.S. Pipe’s
favor. Deniz v . Municipality of Guaynabo,
285 F.3d 1 4 2 , 144
5
(1st Cir. 2 0 0 2 ) .
U.S. Pipe’s counterclaim seeks relief through the
Declaratory Judgment Act. Under the A c t , “[i]n a case of
actual controversy within its jurisdiction, . . . any court of
the United States . . . may declare the rights and other legal
relations of any interested party seeking such declaration,
whether or not further relief is or could be sought.” 28
U.S.C. § 2201(a). As its language makes clear, section 2201
does not enlarge the jurisdiction of the federal courts.
Ernst & Young,
45 F.3d at 5 3 4 . A court therefore cannot grant
declaratory relief on a claim which is unripe for review. See
id. (citing Abbott Labs. v . Gardner,
387 U.S. 1 3 6 , 148-49
(1967)).
In Starter Corp. v . Converse, Inc., 84 F.3d 592 (2d Cir.
1 9 9 6 ) , the Second Circuit held that a claim for a declaration
of trademark rights becomes ripe once the claimant “has
engaged in a course of conduct evidencing a ‘definite intent
and apparent ability to commence use’ of the marks on the
product.” 3
Id. at 595-96 (quoting Golden Gulf Corp. v .
3
This test for ripeness also requires that the adverse
party’s conduct has “created a real and reasonable
apprehension of liability on the part of the [claimant].”
Starter, 84 F.3d at 5 9 5 ; accord PHC, Inc. v . Pioneer
Healthcare, Inc.,
75 F.3d 7 5 , 79 (1st Cir. 1 9 9 6 ) ; Hoyt Elec.
Instrument Works, Inc. v . Isspro, Inc.,
263 F. Supp. 2d 2 8 0 ,
6
Jordache Enters., Inc., 896 F. Supp. 3 3 7 , 340 (S.D.N.Y.
1995)); accord G. Heileman Brewing C o . v . Anheuser-Busch,
Inc.,
873 F.2d 9 8 5 , 991 (7th Cir. 1 9 8 9 ) ; 5 J. Thomas McCarthy,
McCarthy on Trademarks and Unfair Competition § 32:51 (4th ed.
2003). The parties agree on the applicability of this test
but dispute whether U.S. Pipe satisfies it on the basis of the
allegations in the counterclaim.
U.S. Pipe is correct that it need not have commenced
actual use of the redesigned hydrant in order to ripen its
declaratory judgment claim. See Starter, 84 F.3d at 5 9 5 ; G.
Heileman,
873 F.2d at 9 9 0 . Before seeking a declaration of
its rights in a mark, however, a party must have at least
become “engaged in meaningful preparation such that it is
actively preparing to produce the article in question.” 4
Starter,
84 F.3d at 596 (internal quotation marks and citation
284 (D.N.H. 2 0 0 3 ) . The plaintiffs do not challenge the
ripeness of U.S. Pipe’s counterclaim on this basis, however.
4
The Starter court adopted this test despite its
recognition of the principle that “the finding of an actual
controversy should be determined with some liberality” in a
declaratory judgment action over trademark rights. 84 F.3d at
596. U.S. Pipe’s reliance on this statement is therefore
unavailing unless the allegations of its counterclaim satisfy
the Starter test. See
id. (“the most liberal interpretation
of justiciability will not admit to an active controversy in
the absence of either some imminent infringing conduct or some
assertion of the same”) (internal quotation marks omitted).
7
omitted); see also 5 McCarthy § 32:51 (“While the plaintiff
need not engage in actual sales, it must demonstrate that it
has taken the kind of tangible steps toward product launch
that are normal in this industry.”)
U.S. Pipe alleges only that it has “effect[ed] a re-
design” of its original hydrant which “entirely eliminates the
specific design elements upon which [the plaintiffs] expressly
relied” in their complaint in this action and that the
plaintiffs have nevertheless “voiced [their] objection.”
Although U.S. Pipe has submitted a “picture depicting [its]
new design” as an exhibit to the answer, the exhibit is merely
a computer-generated sketch of the design. The counterclaim
therefore does not allege any facts from which the court can
conclude that U.S. Pipe is actively preparing to produce the
redesigned hydrant. 5 C f . Starter, 84 F.3d at 596 (in addition
to completing design, claimant had “invested a significant
5
In its brief in opposition to the plaintiffs’ cross-motion, U.S. Pipe states that it is “moving forward with its
new design” and that it “had clearly taken steps toward
introducing its new hydrant” when the plaintiffs submitted
their reply to the counterclaim. U.S. Pipe has not moved or
otherwise indicated that it intends to amend its counterclaim
to include these allegations, however. In any event, even if
the court could consider these statements in deciding whether
U.S. Pipe’s counterclaim was ripe for adjudication, they are
far too conclusory to provide any assistance in that endeavor.
8
amount of time and money,” conducted a consumer survey, and
made decisions as to manufacturing and licensing); G.
Heileman, 873 F.2d at 991 (claimant alleged that it would
introduce product “in the immediate future,” that it had
already incurred costs of product development, design,
advertising, and market study, and that it was “committed to
making rapidly increasing expenditures totalling millions of
dollars”); NTN Communications, Inc. v . Interactive Network,
Inc.,
1995 WL 569419, at *2 (N.D. C a l . 1995) (recognizing
ripeness of declaratory relief action when defendant had
admitted its intent to resume using claimant’s mark in coming
year).
To the contrary, U.S. Pipe’s allegations suggest that its
“meaningful preparation” of the redesigned hydrant, if any,
will await the court’s decision on the counterclaim. As the
Federal Circuit has observed, declaratory relief in a
trademark case is not available on the theory that “‘[w]e
would like to use the mark, but before we d o , we want a court
to say we may do so safely.’” Windsurfing Intl. Inc. v . AMF
Inc., 828 F.2d 7 5 5 , 758 (Fed. Cir. 1 9 8 7 ) ; see also Joint Stock
Soc’y v . UDV N . Am., Inc.,
53 F. Supp. 2d 6 9 2 , 706-707 ( D .
Del. 1999) (although plaintiffs refrained from use of mark
“out of a genuine fear” of being sued for infringement, Lanham
9
Act claims dismissed as unripe because “out of an apparent
over-abundance of caution, the plaintiffs have not taken any
steps to enter the [relevant] market”), aff’d, 266 F.3d 164
(3d Cir. 2 0 0 1 ) .
U.S. Pipe contends that “greater leeway for an actual
controversy should be allowed where, as here, the parties are
actually engaged in ongoing litigation.” In making this
argument, U.S. Pipe relies heavily on Intel Corp. v . CFW
Wireless, Inc., 2000 WL 1455830 (W.D. V a . Sept. 1 5 , 2 0 0 0 ) ,
where the court ruled that the defendant’s counterclaim,
seeking a declaration that it was entitled to use “InTelos” as
a mark in the event the plaintiff prevailed on its claim that
the defendant’s use of “Intelos” was illegal, was ripe.
Id.
at * 1 . As the plaintiffs point o u t , however, the defendant in
Intel had “taken concrete steps toward producing” the mark and
had “repeatedly represented to the court that . . . [it]
immediately [would] implement use of the ‘InTelos’ mark” if
the plaintiff prevailed on its infringement claim.
Id. at * 2 ,
*3.
Here, U.S. Pipe’s counterclaim does not reference any
“concrete steps” toward producing the redesigned hydrant,
other than the redesign itself, and its submissions do not
contain any such representations. See footnote 5 , supra.
10
Accordingly, the court concludes that U.S. Pipe’s request for
a declaratory relief does not fall within the greater “leeway”
which Intel allowed such a request when brought as a
counterclaim in an infringement action arising out of a
similar mark. 6 See Windsurfing, 828 F.2d at 758 (dismissing
as unripe counterclaim for declaratory judgment brought in
infringement action based on same m a r k ) ; Thrifty Rent-A-Car
Sys., Inc. v . Thrifty Auto Sales of Charleston, Inc.,
849 F.
Supp. 1083, 1086 (D.S.C. 1991) (same).
U.S. Pipe has failed to allege facts sufficient to show
conduct on its part evincing a definite intent and apparent
ability to use the redesigned hydrant. Its counterclaim for a
6
The decision in Intel also relied in large part on its
understanding of the Fourth Circuit’s test for the ripeness of
a declaratory action, which it articulated as “whether a
decision by the court will make a meaningful difference to the
parties by affording meaningful relief.” 2000 WL 1455830, at
*2 (citing R.M.S. Titanic, Inc. v . Haver,
171 F.3d 9 4 3 , 955
(4th Cir. 1999)). The First Circuit, however, treats that
inquiry as but one of the two prongs of the ripeness inquiry.
See McInnis-Misenor v . M e . Med. Ctr.,
319 F.3d 6 3 , 70 (1st
Cir. 2003) (also considering “whether the claim involves
uncertain and contingent events that may not occur as
anticipated or may not occur at all”) (internal quotation
marks omitted). Given its determination that Intel is
otherwise distinguishable, this court expresses no opinion on
whether Intel’s more relaxed standard of ripeness for a
declaratory claim brought as a counterclaim to an infringement
suit squares with First Circuit precedent.
11
declaratory judgment that the redesigned hydrant will not
infringe any of the plaintiffs’ trademark rights is therefore
unripe for review at this point. The plaintiffs’ cross-motion
for judgment on the pleadings on that claim is granted.
II. U.S. Pipe’s Motion for Judgment on the Pleadings
Because the court has dismissed as unripe U.S. Pipe’s
counterclaim for a declaratory judgment, it follows that U.S.
Pipe’s own motion for judgment on the pleadings on that claim
is now moot.
Conclusion
For the foregoing reasons, the plaintiffs’ partial cross-
motion for judgment on the pleadings (document n o . 4 6 ) is
GRANTED. Count I of U.S. Pipe’s counterclaim is dismissed as
unripe at this time. U.S. Pipe’s partial motion for judgment
on the pleadings (document n o . 4 1 ) is moot.
In view of the rulings made in this order, the court is
concerned as to whether or not the plaintiffs’ claims are
moot. It appears that the parties are in agreement that those
claims relate solely to the hydrant which U.S. Pipe exhibited
at the March 2003 trade show. In its counterclaim, however,
U.S. Pipe states that it decided to forego manufacturing this
12
hydrant after being served with the complaint in this action.
With one exception, the remaining counts of the plaintiffs’
complaint seek only to enjoin the production or sales of the
hydrant as originally designed. If U.S. Pipe has indeed
decided to stop producing this version of the hydrant, the
parties ought to be able to resolve this matter promptly
before more of their resources and those of the court are
expended on this case. Therefore, counsel and the parties
shall confer to review settlement of this matter by
stipulation or consent decree. Counsel shall file a joint
status report with the court by February 2 0 , 2004.
SO ORDERED.
Joseph A . DiClerico, J r .
United States District Judge
January 2 2 , 2004
cc: Brian L . Michaelis, Esquire
Brian E . Moran, Esquire
David B . Wilson, Esquire
13
