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Square D Co. v. Scott Electric Co.

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF PENNSYLVANIA


January 28, 2008

SQUARE D COMPANY, PLAINTIFF,
v.
SCOTT ELECTRIC COMPANY; ET AL., DEFENDANTS.

The opinion of the court was delivered by: Nora Barry Fischer United States District Judge

ORDER

This matter is before the Court on the following motions: (1) Square D Company's Motion for Partial Summary Judgment as to Damages against Defendant Edward Vaught d/b/a ABN Direct [DE 105], filed by Plaintiff Square D Company ("Square D") on November 6, 2007; and (2) Scott Electric Company's Motion for Partial Summary Judgment as to Damages against Defendant, Edward Vaught d/b/a ABN Direct [DE 121], filed by Defendant/Cross-Claimant Scott Electric Company ("Scott") on December 13, 2007. As of the date of this Order, Defendant Edward Vaught d/b/a ABN Direct (hereinafter, "ABN") has failed to respond to either motion. The Court will consider each motion in turn.

FACTS*fn1

Plaintiff Square D is a leading manufacturer and supplier of electrical distribution products for both consumer and commercial applications. Docket No. 106, at ¶2 (hereinafter, "Plaintiff's SOF"). Defendant Scott is a regional distributor and supplier of electrical products for commercial and consumer uses. Docket No. 122, at ¶3 (hereinafter, "Scott's SOF"). Defendant ABN sells and distributes electrical components, including counterfeit circuit breakers. Scott's SOF, at ¶4.

Defendant ABN is not a Square D authorized distributor and has never had any relationship with Square D.

All Square D circuit breakers bear its federally registered trademarks. Plaintiff's SOF, at ¶7. Square D's marks include a trademark in the overall configuration of its QO(r)line of circuit breakers, which come in varying models, including the QO(r) 2020. Plaintiff's SOF, at ¶8.

In late March of 2006, Defendant ABN sold approximately 21,600 Square D QO(r) 2020 circuit breakers to Defendant Scott.*fn2 Plaintiff's SOF, at ¶10; Scott's SOF, at ¶¶4, 9, 14. Scott paid Defendant ABN $261,000, including freight, for the shipment. Scott's SOF, at ¶16. In turn, Scott sold approximately 20,000 of the same circuit breakers to companies in Texas and Pennsylvania. Plaintiff's SOF, at ¶11. In early March of 2006, Square D inspected the QO(r) 2020 circuit breakers purchased from Scott and determined that they were not authentic Square D products. Plaintiff's SOF, at ¶12. In subsequent inspections in June of 2006, Square D examined 17,695 QO(r) 2020 circuit breakers shipped from Scott and determined that all were counterfeit. Plaintiff's SOF, at ¶12.

With the exception of the above documents provided by ABN to Square D, Defendant ABN has not participated in this litigation. Plaintiff's SOF, at ¶¶17-18; Scott's SOF, at ¶21. Through separate litigation by way of a known counterfeiter, Square D determined that QO(r) 2020 circuit breakers may be obtained on the black market for $1.25 per breaker. Plaintiff's SOF, at ¶14.

Pursuant to Local Rule 56.1(E), because Defendant Vaught has failed to respond to the alleged material facts set forth in Square D's and Scott's statements of undisputed facts, for the purposes of the instant motions, all said facts are deemed admitted. See W.D. Pa. L.R. 56.1(E); see also Gajdos v. Missig, Civil Action No. 06-1362, 2008 WL 147150, at *1 n.1 (W.D. Pa. Jan. 14, 2008) (McVerry, J.); Goral v. Pyramid Healthcare, No. 2:06cv1430, 2008 WL 144201, at *2 n. 1(W.D. Pa. Jan. 11, 2008) (Cercone, J.).

PROCEDURAL HISTORY*fn3

On April 7, 2006, Plaintiff Square D commenced this lawsuit by filing a Verified Complaint against Defendant Scott and Bossert's Hardware and Sporting Goods Store, alleging the sale of counterfeit goods in violation of the Lanham Act, 15 U.S.C. §§1114(1) and 1125(a)(1), as to Defendants Scott and Bossert) as well as the use of false and deceptive advertising in violation of the Lanham Act, 15 U.S.C. § 1125(a)(1)(A), commercial disparagement, and tortious interference with existing and prospective business relations, all as to Defendant Scott.*fn4 On June 29, 2006, the Court granted Plaintiff's Motion for Leave to File Amended Complaint, which Plaintiff subsequently filed that same day, see Docket No. 31 (Verified Amended Complaint), naming Defendants ABN and Globe Electric Supply Company Inc. In its Verified Amended Complaint, Plaintiff pled three causes of actions against all Defendants, specifically the sale of counterfeit goods in violation of the Lanham Act, 15 U.S.C. §§1114(1) and 1125(a)(1) as well as tortious interference with contract and tortious interference with existing and prospective business relations under the common law of Pennsylvania. In short, Plaintiff Square D alleged that Defendants Scott, ABN, and Globe unlawfully imported, distributed, and sold counterfeit Square D products thereby posing a serious threat to consumer safety.

On August 2, 2006, Defendant Scott filed a Cross-claim against Defendant ABN.

On October 11, 2006, Plaintiff Square D filed a Motion for Default Judgment against Edward Vaught d/b/a ABN Direct, see Docket No. 40, which the Court granted on October 30, 2006, entering default judgment pursuant to Federal Rule of Civil Procedure 55 in favor of Square D and against Defendant ABN and adjudging the following: Defendant Edward Vaught, d/b/a ABN Direct, and its agents, representatives, officers, and employees are permanently and finally enjoined and restrained from importing, exporting, marketing, selling, distributing or purchasing (either directly or indirectly) any counterfeit or authentic products; Defendant Vaught shall account to Square D for each and every purchase and sale of counterfeit breakers; Defendant Vaught shall turn over to Square D any counterfeit Square D products; and Defendant Vaught shall disgorge its profits from the sales of counterfeit Square D products and pay Square D attorneys' fees and costs expended in pursuing this litigation, in an amount to be determined at a hearing before the Court. See Docket No. 48, at 1-2.*fn5

On February 23, 2007, Scott filed a Motion for Default Judgment against Edward Vaught d/b/a ABN Direct, see Docket No. 59, which the Court granted on March 5, 2007, entering default judgment pursuant to Federal Rule of Civil Procedure 55 in favor of Scott and against Defendant ABN and adjudging that Defendant ABN shall pay damages to Scott in the amount of $261,000 in liquidated damages as immediate payment, see Docket No. 62.*fn6

STANDARD

Summary judgment under Federal Rule of Civil Procedure 56(c) is appropriate "if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c) (2007).*fn7 In deciding a summary judgment motion, the court must "view the evidence ...through the prism of the substantive evidentiary burden" to determine "whether a jury could reasonably find either that the plaintiff proved his case by the quality and quantity of the evidence required by the governing law or that he did not." Anderson v. Consolidated Rail Corp., 297 F.3d 242,247 (3d Cir. 2002) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 254 (1986)).

When the non-moving party will bear the burden of proof at trial, the moving party's burden can be "discharged by 'showing'-that is, pointing out to the District Court-that there is an absence of evidence to support the non-moving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). If the moving party has carried this burden, the burden shifts to the non-moving party who cannot rest on the allegations of the pleadings and must "do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986); Petruzzi's IGA Supermarkets, Inc. v. Darling-Delaware Co., 998 F.2d 1224, 1230 (3d Cir. 1993). Thus, the non-moving party cannot rest on the pleadings, but instead must go beyond the pleadings and present "specific facts showing a genuine issue for trial," Fed.R.Civ.P. 56(e)(2) (2007), and cannot rely on unsupported assertions, conclusory allegations, or mere suspicions in attempting to survive a motion for summary judgment. Williams v. Borough of W. Chester, 891 F.2d 458, 460 (3d Cir. 1989) (citing Celotex, 477 U.S. at 325 (1986)). The non-moving party must respond "by pointing to sufficient cognizable evidence to create material issues of fact concerning every element as to which the non-moving party will bear the burden of proof at trial." Simpson v. Kay Jewelers, Div. of Sterling, Inc., 142 F.3d 639, 643 n.3 (3d Cir. 1998) (quoting Fuentes v. Perskie, 32 F.3d 759, 762 n.1 (3d Cir. 1994)). "If the opposing party does not so respond, summary judge should, if appropriate, be entered against the party." Fed.R.Civ.P. 56(e)(2) (emphasis added).

ANALYSIS

1. Square D's Motion for Partial Summary Judgment

In its motion, Square D asserts that it is entitled to disgorgement of Defendant Vaught's profits, and, as such, Square D requests partial summary judgment as to damages in the amount of $232,200. In the alternative, Square D requests statutory damages under the Lanham Act in the amount of $500,000 or in a reasonable amount to be determined by the Court.

Having considered Plaintiff's motion and the attached exhibits and noting that all undisputed facts set forth in Square D's motion have been admitted by way of Defendant ABN's failure to respond to the same, the Court finds that Square D is entitled to partial summary judgment as to damages in the amount of $232,200.

2. Scott's Motion for Partial Summary Judgment

In its motion, Scott requests summary judgment against Defendant ABN for damages in the in the amount of $261,100.

Having considered Scott's motion and the attached exhibits and noting that all undisputed facts set forth in Scott's have been admitted by way of Defendant ABN's failure to respond to the same, the Court finds that Scott is entitled to partial summary judgment as to damages in the amount of $261,100.

3. Conclusion

Based on the foregoing, the Court GRANTS Square D Company's Motion for Partial Summary Judgment as to Damages against Defendant Edward Vaught d/b/a ABN Direct [DE 105] and GRANTS Scott Electric Company's Motion for Partial Summary Judgment as to Damages against Defendant Edward Vaught d/b/a ABN Direct [DE 121]. Appropriate Orders to follow.


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