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Intellectual Property – Trademark & Trade Dress Infringement – Civil Practice – Statute of Limitations & Laches

Where plaintiff accused defendants of violating plaintiff’s intellectual property rights in plaintiff’s skin care products in July 2012, plaintiff’s Feb. 3, 2017, complaint was filed outside the statute of limitations for plaintiff’s state law claims, and plaintiff’s Lanham Act claims are limited to events after Feb. 3, 2014.

The court grants in part and denies in part defendants’ motion to dismiss. Plaintiff is directed to file an amended complaint.

Statute of Limitations

The complaint alleges that, in July 2012, plaintiff’s manager, Johnny Hoy, “told [defendant U.S. Foods, Inc.] that [defendants Hymans Seafood Co.] stole the marketing, product, intellectual property and put him on notice.” Plaintiff alleges that in response, the US Foods representative answered that “that is between you and Hymans.”

This proves that at least by July 2012, plaintiff was aware that Hymans was embarking on infringing activity and that US Foods was selling the “pirated” goods. The complaint was not filed until Feb. 3, 2017 – nearly five years after plaintiff knew that a cause of action for intellectual property infringement existed. Therefore, the three-year statute of limitations bars plaintiff’s South Carolina Unfair Trade Practices Act and South Carolina trade secret misappropriation claims.

Since the Lanham Act does not provide an express statute of limitations, the court applies the most analogous South Carolina limitations period: three years. The three-year statute of limitations for Lanham Act claims would not bar plaintiff from asserting a claim for any infringing acts that Hymans and US Foods committed after Feb. 3, 2014.

Lanham Act

As of Sept. 11, 2012, plaintiff had registered a trademark for the formula for its personal care products. To the extent that plaintiff is bringing Lanham Act claims for the personal care products themselves, plaintiff may assert claims for trademark infringement that accrued after February 2014. However, the bulk of plaintiff’s claims appear to be premised on the marketing method and packaging practice of packing personal skin care products in mason jars – not on the products themselves.

Plaintiff also alleges that it has filed an application for a utility patent for its marketing and sales methods with the U.S. Patent and Trademark Office. However, it cites no authority for the proposition that an application for a patent is enough to prove that it has a trademark for Lanham Act purposes.

Plaintiff has not adequately alleged that it has a valid trademark in its marketing method.

Because plaintiff has not sufficiently alleged that it possesses a mark, the court grants defendants’ motion to dismiss on all of plaintiff’s Lanham Act claims.

Many of plaintiff’s Lanham Act claims are also barred by the doctrine of laches, as the five-year delay between Hoy’s initial contact with US Foods about Hymans’ infringing actions and its filing of this lawsuit is unreasonable. Had plaintiff acted more promptly, its damages could have been greatly reduced.

Copyright

Plaintiff owns a copyright in three images of its display. However, plaintiff seems to be confusing a copyright infringement claim for a trademark infringement claim – at no point does plaintiff allege that Hymans used the images that plaintiff has a copyright to. Instead, plaintiff appears to allege trademark infringement of the products contained in the copyrighted images.  Therefore, the court grants the motion to dismiss as to the copyright infringement claim.

Motions granted in part and denied in part.

Secret of the Islands, Inc. v. Hymans Seafood Co. (Lawyers Weekly No. 002-074-18, 19 pp.) (David Norton, J.) 2:17-cv-00342; Brian Dumas and Richard Mark Blank for plaintiff; Emily Irene Bridges, Giampiero Diminich, Natalma McKnew, John Letchinger, Joshua Wallace Dixon, Matthew Caccamo and Michael Scardato for defendants. D.S.C.

 

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