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Members 1st Federal Credit Union v. Metro Bank

October 22, 2010


The opinion of the court was delivered by: Chief Judge Kane


Plaintiff filed suit against Defendants alleging trademark infringement and unfair competition. (Doc. No. 1.) Defendants moved for partial summary judgment on Plaintiff's claims for money damages, an accounting of profits, treble damages, and attorneys' fees pursuant to the Lanham Act and the common law. (Doc. No. 48 at 1-2.) The motion has been fully briefed and is now ripe for decision. For the reasons that follow, the Court will grant Defendants' motion in part, and deny Defendants' motion in part.


Plaintiff Members First Federal Credit Union, a federally-chartered credit union located in Adams, Cumberland, Dauphin, Lebanon, Perry and York Counties in Pennsylvania, is the owner of a federally-registered trademark for its red "M1st" logo (hereinafter "Members M"). (Doc. No. 49 ¶¶ 4-5.) Plaintiff first began using the Members M in March 2003, and Plaintiff first registered their mark on February 18, 2005. (Id. at ¶ 8.)

Prior to becoming Metro Bank in 2009, Defendant Metro Bank was known as Pennsylvania Commerce Bancorp and operated as "Commerce Bank." (Id. at ¶ 12.) Per a contractual agreement with Commerce Bank New Jersey, Defendant Metro Bank was permitted to operate as Commerce Bank and utilize Commerce Bank trademarks and trade dress until Commerce Bank New Jersey ceased operations as Commerce Bank. (Id. at ¶¶ 12, 14.)

In August 2007, Toronto Dominion Bank announced the purchase of Commerce Bank New Jersey. (Id. at ¶ 15.) Pursuant to its contract with Commerce Bank New Jersey, Defendant Metro Bank began a rebranding effort. (Id. at ¶ 16.) Initially, Defendant Metro Bank attempted to retain the use of the Commerce Bank brand and name. (Id. at ¶ 17.) However, following negotiations with Toronto Dominion, Defendant Metro Bank was prohibited from using the name "Commerce," a "C," or Commerce font in connection with its new branding efforts. (Id. at ¶¶ 19-21.) Defendant Metro Bank then entered into merger discussions with Republic First Bank, which was planning to launch a "Metro Bank (UK)" in London. (Id. at ¶¶ 24-26.) Although the merger could not be approved by regulators in time for Defendant Metro Bank to fulfill its rebranding obligations to Toronto Dominion, Defendant Metro Bank's board elected to adopt the Metro Bank name and logo. (Id. at ¶¶ 28-29.) On May 26, 2009, Defendant Metro Bank and Metro Bank (UK) entered into a branding agreement to share costs and divide ownership of all intellectual property developed in connection with the branding of Metro Banks in the United States and the United Kingdom. (Id. at ¶ 30-32.) By the time the branding agreement was finalized, the Metro Bank brand design, including the Metro M Mark (hereinafter "Metro M"), had already been created. (Id. at ¶ 34.) Defendant began using the Metro M on June 14, 2009, and registered it on April 20, 2010. (Id. at ¶ 9.)

Plaintiff alleges that Defendant Metro Bank's extensive use of the Metro M, including "on signage outside its branches, promotional literature, sponsorship of the area's Minor League baseball stadium, billboards, website and Internet advertising, and even a large 6-foot high red 'M,' standing alone, on the outside face of its branch office buildings," has resulted in a number of customers becoming confused by the logos. (Doc. No. 1 ¶ 3-4; Doc. No. 57 at 7-8.) On June 19, 2009, Plaintiff initiated this suit seeking injunctive relief, damages, and other statutory relief based on trademark infringement, misappropriation, unfair competition, and false designation of origin pursuant to the Lanham Act, and for common law trademark infringement and unfair competition. (Doc. No. 1 ¶ 1.) Defendants now seek summary judgment against Plaintiff on Plaintiff's claims for damages, treble damages, an accounting of profits, and attorneys' fees pursuant to 15 U.S.C. § 1117. (Doc. No. 48 at 1-2.)


Federal Rule of Civil Procedure 56(c) provides that summary judgment is warranted "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). A factual dispute is material if it might affect the outcome of the suit under the applicable law, and it is genuine only if there is a sufficient evidentiary basis that would allow a reasonable fact finder to return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986). At summary judgment, the inquiry is whether the evidence presents a sufficient disagreement to require submission to the jury or whether it is so one-sided that one party must prevail as a matter of law. Id. at 251-52. In making this determination, the Court must "consider all evidence in the light most favorable to the party opposing the motion." A.W. v. Jersey City Pub. Schs., 486 F.3d 791, 794 (3d Cir. 2007).

The moving party has the initial burden of identifying evidence that it believes shows an absence of a genuine issue of material fact. Conoshenti v. Pub. Serv. Elec. & Gas Co., 364 F.3d 135, 145-46 (3d Cir. 2004). Once the moving party has shown that there is an absence of evidence to support the non-moving party's claims, "the non-moving party must rebut the motion with facts in the record and cannot rest solely on assertions made in the pleadings, legal memoranda, or oral argument." Berckeley Inv. Group. Ltd. v. Colkitt, 455 F.3d 195, 201 (3d Cir. 2006); accord Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). If the non-moving party "fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden at trial," summary judgment is warranted. Celotex, 477 U.S. at 322.

With respect to the sufficiency of the evidence that the non-moving party must provide, a court should grant summary judgment where the non-movant's evidence is merely colorable, conclusory, or speculative. Anderson, 477 U.S. at 249-50. There must be more than a scintilla of evidence supporting the non-moving party and more than some metaphysical doubt as to the material facts. Id. at 252; see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986).


As an initial matter, the Court notes that it appears that Plaintiff is unclear as to what relief it is seeking. In its complaint, Plaintiff seeks monetary relief on three theories under the Lanham Act: (1) actual damages, including treble damages; (2) an accounting of profits; and (3) attorneys' fees.*fn1 (Doc. No. 1 at 17.) However, in its Brief in Opposition, Plaintiff makes no distinction between an accounting of profits and actual damages.*fn2 Indeed, Plaintiff only provides argument on the issue of profits and attorneys' fees, repeatedly asserting that it is under no obligation to prove actual damages. (Doc. No. 57. At 9-10.)

Actual damages and profits are two distinct forms of relief under than Lanham Act. See generally 5 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 30:57 (4th ed. 1996) (distinguishing between the types of monetary relief afforded by the Lanham Act). Section 35(a) of the Lanham Act provides that the Court may, subject to principles of equity, award monetary relief to a plaintiff who has proved infringement of a registered mark in the form of "(1) defendant's profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action." 15 U.S.C. § 1117(a)(1)-(3) (2006) (emphasis added). These remedies are not mutually exclusive. Where a plaintiff seeks an award of profits and an award of damages a court may, mindful of equitable principles and the prohibition on double recovery, award only one type of relief, award both, or deny all monetary relief. See, e.g., Mishawaka Rubber & Woolen Mfg. Co. v. S. S. Kresge Co., 316 U.S. 203, 208 (1942) (vacating and remanding to the district court to determine if actual damages in addition to lost profits are warranted); Restatement (Third) of Unfair Competition ยง 36 cmt. c (1995). In the ...

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