The opinion of the court was delivered by: McLAUGHLIN, Sean J., J.
District Judge McLaughlin
This matter is before the Court upon Defendant Betts Industries, Inc.'s Motion for Attorney Fees and Costs Pursuant to 15 U.S.C. §1117(a)(3). An evidentiary hearing on Betts' Motion was held on November 18, 2010 and December 15 and 16, 2010 ("Evidentiary Hearing"). The following constitute the Court's Findings of Fact and Conclusions of Law.
1. Allegheny Coupling ("Allegheny"), founded in 1955, markets and sells industrial couplings and fittings. (Deposition of Raymond V. Heelan ("Heelan Depo."), p. 40).
2. Betts Industries ("Betts"), founded in 1901, was originally a foundry and job shop and eventually grew to become a manufacturer of its own proprietary products for the highway cargo tank industry. (Affidavit of Rodney E. Betts, ¶¶ 3-6).
3. On March 24, 2006, Allegheny commenced the instant action against Betts alleging, inter alia, trademark and trade dress infringement in violation of the Lanham Trademark Act, 15 U.S.C. §1051 et seq ("Lanham Act") and seeking a declaratory judgment as to the ownership of certain equipment, dies and molds which both parties claimed to legally own. (See Doc. 1, Complaint). Allegheny subsequently filed three separate amended complaints, each of which contained claims of trademark and trade dress infringement. (See Doc. 4, Amended Complaint; Doc. 32, Second Amended Complaint; Doc. 45, Third Amended Complaint).
B. Allegheny's Trade Dress Claim
4. In Count II of the Third Amended Complaint, Allegheny asserted a claim for trade dress infringement relative to Allegheny's "coupling and fitting products." (Doc. 45, Third Amended Complaint, ¶ 32-34). Specifically, Allegheny alleged that its "coupling and fitting products have a consistent total image and overall appearance featuring size, shape, color and texture characteristics" which constitute "a valid and protectable trade dress configuration." (Id. at ¶¶ 32-33). Allegheny also alleged that its trade dress was "non-functional and distinctive." (Id. at ¶ 35).
5. Throughout the discovery stage of this litigation, the parties frequently clashed over the broad nature of Allegheny's discovery requests. In response to a motion from Betts seeking clarification as to which products formed the basis for Allegheny's trademark and trade dress infringement claims, the Court ordered Allegheny to supply a list identifying the specific products that formed the basis of those claims. (Betts Ex. 4, Transcript of Hearing on 2/13/08, pp. 5-6).
6. On March 3, 2008, Allegheny served Betts with a list containing
2,267 products that it claimed were subject to trademark and/or trade
dress protection and sought extensive
discovery relative to those items. (Betts Ex. 1, Product List;
Transcript of Evidentiary Hearing, 11/18/10, pp. 88-91).*fn1
The product list contained a wide variety of parts including
pipes, pipe fittings, strainers, gaskets, hex nuts, flanges, valves
and aluminum clips. (Id.) Allegheny President Raymond Heelan
("Heelan") and former Chief Executive Officer Jamie Sitler ("Sitler")
each participated in generating the initial list of 2,267 products.
(Trans. 11/18/10, p. 55; Trans. 12/15/10, pp. 60-67).
7. On June 9, 2008, in response to a Motion for a Protective Order filed by Betts, the Court directed Allegheny to "delineate specifically and with sufficient detail" which of those 2,267 parts formed the basis for Allegheny's trademark and trade dress infringement claims. (Betts Ex. 5, Transcript of Hearing on 6/9/10, p. 49).
8. In response to the Court's Order of June 9, 2010, Allegheny produced a thirty-five page list containing approximately 2,110 parts that it contended were subject to either trademark or trade dress protection. (Betts Ex. 2; Trans. 11/18/10, pp. 66-70). Included in the list were parts such as pipes, pipe fittings, strainers, gaskets, hex nuts, flanges, valves and aluminum clips. (Id.). Next to approximately 2,065 of the 2,110 listed parts, Allegheny marked an "x" to indicate that the part was subject to a claim of trade dress infringement. (Id.). Heelan and Allegheny Vice-President and Secretary Cairn Bishop ("Bishop") each participated in generating this list. (Trans. 11/18/10, p. 55; Trans. 12/15/10, pp. 60-67).
9. On August 1, 2008, Betts deposed Allegheny's designated Rule 30(b)(6) representative, Jamie Sitler. At that time, Sitler served as Allegheny's Chief Executive Officer. (Betts Ex. 7, Sitler Depo., p. 7).
10. Sitler identified the purported trade dress of Allegheny's pipe products as "the weld seam" and the "bells" or "belled ends" of certain pipe fittings:
The trade dress configuration is really a compilation of both the bells, which are unique, and also the seam which you can clearly see. And that is the recognizable feature of those fittings. (Betts Ex. 7, Sitler Depo., p. 72).
11. Sitler used a 90-degree metal elbow tube with a 6 inch radius to physically demonstrate the welded seam and belled end that Allegheny claimed as trade dress. (Betts Ex. 7, Sitler Depo., p. 72).
12. Sitler admitted that the seam weld and belled edge of the elbow pipe are both functional. He explained that the function of the seam weld is to join together the two pieces of metal that constitute the complete elbow and that the function of the bell is to allow another tube to slide into the belled end so that both tubes can be joined. (Betts Ex. 7, Sitler Depo., p. 73-74). Without the weld or the bell, the product would not work. (Id. at 73-74).
13. Although Allegheny asserts that the welded seam on the 6 inch tube was a critical element of the product's trade dress, Allegheny began producing an otherwise identical product without the welded seam in or around 2004 because the seamless product was more "state of the art" and represented the direction that the industry was heading. (Betts Ex. 7, Sitler Depo., pp. 87-88).
14. Sitler also attempted to demonstrate the features of a "four-inch diameter flued flange" that Allegheny claimed as trade dress. Sitler asserted that the trade dress of that item was the "flued edge" of the flange. (Betts Ex. 7, Sitler Depo., p. 81).
15. Sitler admitted that the flued edge of the flange is entirely functional in that its purpose was to "strengthen" the flange and to make it easier to attach the flange to another product. (Betts Ex. 7, Sitler Depo., p. 82).
16. Upon inspection, Sitler could not identify any trade dress features of a "3-inch diameter aluminum flange" despite that product appearing on the list of products over which Allegheny asserted trade dress protection. (Betts Ex. 7, Sitler Depo., pp. 88-89).
17. Allegheny never identified any trade dress features for many of the thousands of products that Allegheny claimed were subject to trade dress protection. For example, Allegheny provided no evidence that any of its hex nuts, strainers, gaskets, or aluminum clips had an identifiable trade dress.
18. Many of Allegheny's responses, when pressed to identify the trade dress of a specific part or item, were patently frivolous. For example, Heelan stated that the trade dress of a particular 4-inch aluminum flange was the fact that the outer dimensions of the flange failed to meet industry standard specifications. (Trans. 11/18/10, pp. 72-73). Despite his identification of that feature as the product's trade dress, Heelan indicated that the company was working to improve the manufacturing process so that the flange would meet specifications in the future. (Trans. 11/18/10, pp. 75). Heelan conceded that the flange's deviation from industry standard dimensions was not noticeable unless someone measured the flange. (Trans. 11/18/10, p. 74).
19. Neither Heelan nor Bishop could identify a common or unifying trade dress for the hundreds of parts identified by Allegheny as subject to trade dress protection. (Trans. 11/18/10, pp. 64-73; Trans. 12/15/10, pp. 63-66).
20. Many of the parts that Allegheny claimed were subject to trade dress protection were fundamentally generic. For example, the list of parts over which Allegheny asserted trade dress protection included a "3/8-16 hex nut." A hex nut is a common, generic piece of hardware that connects to a bolt and is widely available at any hardware store. (Trans. 11/18/10, pp. 124-25; Betts Ex. 39, Hex Nuts).
21. Allegheny also attempted to assert a trade dress infringement claim over a series of chemical hydraulic valves despite that Betts was the owner of a valid patent ...