The opinion of the court was delivered by: BRODY
This memorandum addresses defendant Minami International Corporation ("Minami")'s motion for a preliminary injunction mandating that plaintiff J. Kinderman & Sons d/b/a Brite Star Manufacturing Company ("Brite Star") direct the United States Customs Service ("Customs") not to detain, seize or otherwise interfere with importation of Minami's holiday light sets. These light sets, which are expected to arrive in U.S. ports within the next month to two months, are the subject of the initial action brought by Brite Star on May 21, 1998 for trademark infringement and unfair competition under the Lanham Act, 15 U.S.C. § 1051 et seq. and Pennsylvania law . For the reasons that follow, I will deny the motion for preliminary relief.
Brite Star alleges that it holds a validly registered trademark for the term "NET LITES" to identify a type of Christmas or holiday light set it sells, and that defendant Minami manufactures and sells a similar product, which is offered through the same channels of trade, and which it identifies as a "NET LIGHT". Brite Star alleges that Minami uses the term "NET LIGHT" on its packaging as a trademark, and that such use constitutes trademark infringement under the Lanham Act, 15 U.S.C. § 1051 et seq. and Pennsylvania law, as well as unfair competition under 15 U.S.C. § 1125(a) and Pennsylvania law.
On June 16, 1998, Minami filed a counterclaim seeking a declaratory judgment that Brite Star's trademark was invalid and should be canceled because the mark is generic and/or descriptive without a secondary meaning. Alternatively, Minami seeks a declaratory judgment that, if the court finds the mark to be valid, Minami is using the mark not as a trademark but as a description of Minami's goods, and it is used fairly and in good faith, as permitted by § 1115(b)(4) of the Lanham Act.
On June 24, 1998, Minami filed a motion for a preliminary injunction, seeking a mandate that Brite Star direct the U.S. Customs Service not to detain any of Minami's products when they arrive in U.S. ports, as they are expected to do within the next month to two months. Minami asserts that it meets all four parts of the test for issuance of a preliminary injunction: that it is likely to succeed on at least one of its defenses to Brite Star's infringement/unfair competition claim; that it will suffer irreparable harm to its business reputation if its products are detained, even temporarily, by the Customs Service; that Brite Star has an adequate legal remedy in the event Brite Star prevails on its infringement claim after a full trial on the merits, but that Minami has no adequate legal remedy if the injunction is denied; and that the public interest is served by grant of the injunction. Brite Star argues in response that it holds a presumptively valid (i.e., neither generic nor descriptive without secondary meaning) trademark; that Minami uses the term "NET LIGHT" or "NET LIGHTS" as a trademark; and that Minami can show no irreparable harm flowing from the denial of preliminary relief.
I held a hearing on Minami's motion on June 30, 1998, at which time Minami offered the testimony of its president, Nori Juba, and of Sandy Kinderman, CEO of Brite Star, as well as several exhibits, including one of Brite star's light sets sold with the trademark "NET LITES". Brite Star offered the testimony of Mr. Kinderman, and several exhibits, including one of Minami's similar light sets. Both parties submitted proposed findings of fact and conclusions of law.
Based on the evidence presented, I have determined that Minami has failed to make the requisite showing of irreparable harm, and is therefore not entitled to the extraordinary remedy of a preliminary injunction. Because I am denying the motion for preliminary relief, I need not and do not make detailed findings as to the several issues presented for ultimate resolution in this case. Fed.R.Civ.P. 65(d). Specifically, I make no findings regarding Minami's likelihood of success on its counterclaims/defenses to the infringement action or, conversely, Brite Star's likelihood of success on its infringement/unfair competition claims.
I make, however, the following findings of fact and conclusions of law in support of my preliminary injunction ruling.
Brite Star is a Philadelphia-based business, founded in 1903 and incorporated in 1932, which manufactures, imports and sells holiday decorations (Tr. 157). Minami is a manufacturer and importer of Christmas lights; the U.S. company, based in Yonkers, NY, was established in 1972 as successor to the family business established in 1908 (Tr. 40). Brite Star and Minami compete for sales of Christmas or holiday lights, and both companies market their products to the same large retail chains. The Christmas light and holiday decorations business is extremely competitive due, in part, to the short holiday selling season (Tr. 187-88). Both companies' version of the product at issue here is manufactured in China. Minami is a significantly larger company than Brite Star, with annual sales in excess of 75 million dollars (Tr. 39).
In November 1996, Brite Star began selling an electric holiday light set under the trademark "NET LITES" (Tr. 160).
The "NET LITES" product consists of electric bulbs connected together in a grid to create a symmetrical sequence of lights (Def. Ex. T). The packaging for the "NET LITES" package is a cylindrical tube, which contains the actual "NET LITES" product (Pl.Ex. 5). The packaging for the "NET LITES" product displays the "NET LITES" mark on the package, with the TM symbol next to the "NET LITES" mark, indicating that Brite Star claims ownership of "NET LITES" as a mark (Pl.Ex. 5). Brite Star has continuously used the "NET LITES" mark for such goods since November 1996 (Tr. 160).
Brite Star's "NET LITES" product is sold to the general public through Brite Star's retail outlet, through direct mail order catalogs such as Hammacher Schlemmer, Petals, Alsto's and Seventh Avenue, through direct response television spots, and through retail outlets such as garden ...