United States District Court, M.D. Pennsylvania
Christopher C. Conner, Chief Judge.
instant matter arises from a trademark dispute between
plaintiff UHS of Delaware, Inc. ("UHS Delaware")
and defendants United Health Services, Inc., ("United
Health Services"), United Health Services Hospitals,
Inc., Professional Home Care, Inc., Twin Tier Home Health,
Inc., Ideal Senior Living Center, Inc., Ideal Senior Living
Center Housing Corporation, Delaware Valley Hospital, Inc.,
and United Medical Associates. Before the court are UHS
Delaware's motion (Doc. 150) for summary judgment and
defendants' motion (Doc. 151) for partial summary
Factual Background and Procedural
factual background of this case is detailed in several prior
opinions, familiarity with which is presumed. UHS Delaware is
the healthcare management company for Universal Health
Services, Inc. ("Universal"). (Doc. 157, Ex. 1
¶ 3).Universal's subsidiaries own and
operate more than 235 acute care and behavior health
facilities and surgery centers in a number of states
throughout the country. (Id.) Universal owns no
subsidiaries or affiliates, and does not operate, in the
state of New York. (See Doc. 153, Ex. D at 3-4). UHS
Delaware does not itself provide healthcare services;
instead, it manages an affiliated network of healthcare
service providers. (See Doc. 157, Ex. 1 ¶ 3).
Delaware owns federal registrations for two trademarks: (1)
the UHS word mark, bearing U.S. Registration No. 1, 696, 433
("the '433 mark"), and (2) the UHS stylized
mark, bearing U.S. Registration No. 2, 741, 663 ("the
'663 mark") for use in connection with hospital
services and hospital management services. (Id. Exs.
2, 4; see Doc. 155 ¶ 1; Doc. 161-5 ¶ 1).
The stylized mark appears as follows:
157, Ex. 4). UHS Delaware owns both marks via assignment from
its parent, Universal. (Id. Ex. 6). The '433
registration issued on June 23, 1992, and the '663
registration issued on July 29, 2003. (Doc. 153 ¶¶
27-28; Doc. 157, Exs. 2, 4). The marks have achieved
"incontestable" status under the Lanham Act. (Doc.
155 ¶ 1; Doc. 161-5 ¶ 1); see also 15 U.S.C. §
are eight nonprofit corporations which together comprise an
integrated healthcare system headquartered in the southern
tier of New York. (Doc. 153 ¶¶ 1, 5-14). Defendants
include: (1) United Health Services, the healthcare
system's parent entity; (2) United Health Services
Hospitals, Inc., a subsidiary of United Health Services which
operates, inter alia, Binghamton General Hospital,
Ideal/Wilson Medical Center, and eighteen physician practice
clinics; (3) Delaware Valley Hospital, Inc., a 25-bed
critical access hospital; (4) Professional Home Care, Inc.,
an advanced home care service; (5) Twin Tier Home Health,
Inc., a certified home health care agency; (6) Ideal Senior
Living Center, Inc., a skilled nursing facility and long term
home health care program; (7) Ideal Senior Living Center
Housing Corporation, an independent living and adult care
facility; and (8) United Medical Associates, P.C., a
multi-specialty medical practice group comprising 185
physicians and 128 advanced practice providers. (Id.
¶¶ 5-14). United Health Services does not have any
facilities outside of New York state. (Id. ¶
United Health Services healthcare system began using the
acronym "UHS" in approximately 1982. An employee
newsletter issued that year was titled "UHS Life."
(Id. ¶ 17). Defendants issued seven subsequent
newsletters titled "The UHS News" between 1983 and
1990. (Id.) United Health Services also used
"UHS" in occasional pamphlets and certain annual
reporting. (Id.) News articles and reports regularly
referred to the system as "UHS" during this time.
(Id. ¶ 22). In 1990 or 1991, United Health
Services erected monument signs outside of the Binghamton and
Wilson hospitals. (Id. ¶ 20). Each sign was
approximately six feet tall, boasting a large "United
Health Services" seal and the hospital's name,
followed by subscript stating "United Health Services
Hospitals" and "A Member of the UHS Health Care
System." (Doc. 153-3 at 46, 66-67). United Health
Services registered its domain name-www.uhs.net-in
July 1997. (Doc. 153 ¶ 25).
Health Services adopted a new system wide brand in 1997.
(See Doc. 155 ¶ 5; see also Doc. 161-5
¶ 5). The rebranding initiative aimed to create a
unified corporate identity, structured around the following
Doc. 157, Ex. 47). The branding guidelines issued to all
United Health Services entities stated: "There should be
no variation in the logo. This will maintain clarity and
consistency throughout our system." (Id. at 4).
Boyd ("Boyd"), Vice President of Community
Relations for the United Health Services system, testified
that system entities were required to and did comply with the
new branding policy, except for isolated incidents of
"rogue" advertisements by individual system
entities. (Doc. 155 ¶ 7; Doc. 161-5 ¶ 7). The
record reflects that from 1997 until 2010, United Health
Services displayed the new logo on its website and included
the logo in weekly employee newsletters, system periodicals,
annual reports, and advertisements. (Doc. 163, Ex. A, UHSHI
30(b)(6) Dep. (Boyd) 70:15-76:19, 79:5-82:18, 96:12-15,
99:4-102:23, 108:22-110:7 (Jan. 14, 2016)).
Health Services began a new rebranding effort in 2009. (Doc.
155 ¶ 8; Doc. 161-5 ¶ 8). The 2009 rebranding
initiative was led by Boyd and a centralized steering
committee-called Integration, Too!-which included members of
each subsidiary's executive team as well as certain
business unit leaders. (Doc. 155 ¶ 8; Doc. 161-5 ¶
8; see also Doc. 157, Ex. 19, UHSHI 30(b)(6) Dep. (Carrigg)
35:25-37:11 (Jan. 15, 2016)). On August 20, 2009, the
Integration, Too! committee agreed to adopt the following
system wide logo:
155 ¶ 8; Doc. 161-1 ¶ 8; see also Doc.
157, Ex. 29 at 6). To achieve a unified corporate identity,
Integration, Too! also decided to rename each system entity
to include the "UHS" title followed by a specific
location or services delimiter, i.e., "UHS Delaware
Valley Hospital." (Doc. 157, Ex. 35 at 3). United Health
Services introduced "UHS" and the stylized logo as
its "new name" in June 2010. (Id. Ex. 61
Delaware instituted this action with the filing of a
complaint (Doc. 1) on March 16, 2012, subsequently filing an
amended complaint (Doc. 9) on April 26, 2012, and a second
amended complaint (Doc. 14-3) on June 6, 2012. UHS Delaware
asserts the following claims: federal trademark infringement
of the '433 mark (Count I) and the '663 mark (Count
III) under 15 U.S.C. § 1114; federal unfair competition
as to the '433 mark (Count II) and the '663 mark
(Count IV) under 15 U.S.C. § 1125(a) and common law;
state law infringement of the '663 mark under 54 Pa.
Stat. & Cons. Stat. Ann. § 1123 (Count V); and
contributory infringement under federal and state statutory
law and common law against United Health Services alone
(Count VI). In the alternative, UHS Delaware seeks a
declaration of the parties' respective rights pursuant to
28 U.S.C. § 2201 (Count VII).
filed individual answers and affirmative defenses (Docs.
114-20) on March 3, 2015. Among other defenses, each
defendant asserts that it has senior rights to the
"UHS" mark against UHS Delaware in New York state.
(See id.) United Health Services separately asserted
counterclaims against UHS Delaware, seeking cancellation of
the '433 and '663 marks. (Doc. 114). The court
dismissed United Health Services' counterclaims with
leave to amend by memorandum and order dated November 19,
2015. UHS of Delaware, Inc., 2015 WL 7294454. United
Health Services elected not to amend its counterclaims.
a period of discovery, the parties filed the instant
cross-motions (Docs. 150-51) for summary judgment, together
with supporting papers. The motions are fully briefed and ripe
Standard of Review
summary adjudication, the court may dispose of those claims
that do not present a "genuine dispute as to any
material fact" and for which a jury trial would be an
empty and unnecessary formality. Fed.R.Civ.P. 56(a). The
burden of proof tasks the non-moving party to come forth with
"affirmative evidence, beyond the allegations of the
pleadings, " in support of its right to relief.
Pappas v. City of Lebanon, 331 F.Supp.2d
311, 315 (M.D. Pa. 2004); see also Celotex Corp. v.
Catrett, 477 U.S. 317, 322-23 (1986). This evidence must
be adequate, as a matter of law, to sustain a judgment in
favor of the non-moving party on the claims. See Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 250-57 (1986);
Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 587-89 (1986). Only if this threshold is met
may the cause of action proceed. See Pappas, 331
F.Supp.2d at 315.
are permitted to resolve cross-motions for summary judgment
concurrently. See Lawrence v. City of Phila., 527
F.3d 299, 310 (3d Cir. 2008); see also Johnson v. Fed.
Express Corp., 996 F.Supp.2d 302, 312 (M.D. Pa. 2014);
10A Charles Alan Wright et al., Federal Practice and
Procedure § 2720 (3d ed. 2014). When doing so, the court
is bound to view the evidence in the light most favorable to
the non-moving party with respect to each motion.
Fed.R.Civ.P. 56; Lawrence, 527 F.3d at 310 (quoting
Rains v. Cascade Indus., Inc., 402 F.2d 241, 245 (3d
for trademark infringement and unfair competition share the
same essential elements under both the Lanham Act and
Pennsylvania law. See A&H Sportswear, Inc. v.
Victoria's Secret Stores, Inc., 237 F.3d 198, 210
(3d Cir. 2000); Harp v. Rahme, 984 F.Supp.2d 398,
409-10 (E.D. Pa. 2013). To prevail on either claim, a
plaintiff must establish that (1) the marks in dispute are
valid and legally protectable; (2) plaintiff owns the marks;
and (3) defendant's use of a similar mark generates
"a likelihood of confusion." A&H
Sportswear, 237 F.3d at 210. The court will address
threshold issues of validity and ownership before delving
into the more nuanced likelihood of confusion inquiry and
United Health Services' junior user defense.
Delaware's Motion: Ownership and Validity of the Marks
Health Services does not challenge UHS Delaware's
ownership of the '433 and '663 marks. (Doc. 155
¶ 1; Doc. 161-5 ¶ 1). Nor does it dispute that the
marks are valid and legally protectable. (Doc. 155 ¶ 1;
Doc. 161-5 ¶ 1). Instead, United Health Services
remonstrates throughout its papers that UHS Delaware does not
use either mark. (See Doc. 161-1 at 2-3,
14-15, 19). United Health Services accordingly denies
UHS Delaware's factual assertions concerning advertising
and promotional use of the marks. (See Doc. 161-5
¶¶ 2-3). It further asserts that UHS Delaware has
not produced any evidence proving that its associated
facilities are licensed users of the '433 and '663
marks. (See Doc. 161-1 at 3). This preliminary issue
permeates many of United Health Services' Rule 56
Lanham Act extends its protections to registered marks in
legitimate use by a registrant's "related
companies." 15 U.S.C. § 1055. When a related
company uses a mark with a registrant's permission, that
use "shall inure to the benefit of the registrant,
" so long as the registrant maintains sufficient control
over the licensee's use. Id. Authorized use by a
related party will maintain a trademark owner's rights
even when the only use of the mark is by the related
party. 3 J. Thomas McCarthy, Trademarks and Unfair
Competition §§ 18:45.50, 18:46 (4th ed. 2016).
Trademark licensing agreements between a registrant and
related parties, whether written or implied, will avail the
registrant of the Act's protections. See
Doeblers' Pa. Hybrids, Inc. v. Doebler, 442 F.3d
812, 824 (3d Cir. 2006).
Delaware need not establish its own use of the trademarks to
defend them against infringement. It is sufficient to
establish use by its licensee affiliates and subsidiaries.
UHS Delaware has submitted the affidavit of its associate
general counsel attesting that Universal's subsidiaries
use both the '433 and '663 marks with permission from
UHS Delaware, pursuant to its healthcare management contracts
with the subsidiary entities. (Doc. 170, Ex. AA ¶¶
2-3). This authorized use of the '433 and '663 marks
by parent and subsidiary corporations of UHS Delaware inures
to its benefit as owner of the marks. Consequently, the court
rejects United Health Services' assertion that UHS
Delaware cannot establish "use" of the marks.
Delaware's Motion: Likelihood of Confusion
prove likelihood of confusion, a plaintiff must demonstrate
that, after viewing both marks, consumers "would
probably assume" that the products or services bearing
the marks share the same source. Checkpoint Svs., Inc. v.
Check Point Software Techs., Inc., 269 F.3d 270, 280 (3d
Cir. 2001) (quoting Scott Paper Co. v. Scott's Liquid
Gold, Inc., 589 F.2d 1225, 1229 (3d Cir. 1978),
superseded on other grounds by Shire U.S. Inc. v. Barr
Labs., 329 F.3d 348, 352 n.10 (3d Cir. 2003)),
aff'g 104 F.Supp.2d 427 (D.N.J. 2000). Courts
within the Third Circuit Court of Appeals apply a familiar,
nonexhaustive list of factors (the "Lapp
factors") to determine whether there is a likelihood of
confusion between competing marks:
(1) the degree of similarity between the owner's mark and
the alleged infringing mark; (2) the strength of the
owner's mark; (3) the price of the goods and other
factors indicative of the care and attention expected of
consumers when making a purchase; (4) the length of time the
defendant has used the mark without evidence of actual
confusion arising; (5) the intent of the defendant in
adopting the mark; (6) the evidence of actual confusion; (7)
whether the goods, though not competing, are marketed through
the same channels of trade and advertised through the same
media; (8) the extent to which the targets of the
parties' sales efforts are the same; (9) the relationship
of the goods in the minds of consumers because of the
similarity of function; [and] (10) other facts suggesting
that the consuming public might expect the prior owner to
manufacture a product in the defendant's market, or that
he is likely to expand into that market.
Interpace Corp. v. Lapp, Inc., 721 F.2d 460, 463 (3d
Cir. 1983) (citing Scott Paper Co., 589 F.2d at
1229). The inquiry is qualitative: no single factor is
dispositive, and not all factors are relevant in every case.
See Checkpoint Sys., 269 F.3d at 280. As the factors
illustrate, likelihood of confusion is a decidedly
fact-intensive issue. Courts have thus cautioned that
"summary judgment for either party is unlikely, absent a
particularly one-sided factual record." 800-JR
Cigar, Inc. v. GoTo.com, Inc., 437 F.Supp.2d 273, 285
(D.N.J. 2006); see also Country Floors, Inc. v.
P'ship Composed of Gepner & Ford, 930
F.2d 1056, 1062-63 (3d Cir. 1991). We address the salient
Lapp factors seriatim.
Factor 1: Similarity of Marks
Third Circuit Court of Appeals ranks similarity of marks as
"the single most important" of the ten
Lapp factors. A&H Sportswear, 237 F.3d
at 216 (citing Fisons Horticulture, Inc. v. Vigoro
Indus., Inc., 30 F.3d 466, 476 (3d Cir. 1994)). Its
importance, however, does not render the factor dispositive.
See Checkpoint Sys., 269 F.3d at 281. Rather than a
"side-by-side comparison, " the court must endeavor
to "move into the mind of the roving consumer" and
ask whether the consumer- encountering one of the two marks
in isolation with only general recollection of the
other-would likely confuse the two. Id.; A&H
Sportswear, 237 F.3d at 216. A court measuring
similarity must "compare the appearance, sound and
meaning of the marks." Checkpoint Sys., 269
F.3d at 281 (citation omitted).
considering a mark's appearance, courts look to
"visual characteristics such as the layout and format of
lettering." Harp, 984 F.Supp.2d at 411-12
(citing A&H Sportswear, 237 F.3d at 217). Courts
measure the "sound" and "auditory
impressions" of a mark by examining the number of words
and syllables employed and the different (or similar) uses of
those words and syllables. See id.
"Meaning" is determined by assessing whether the
combination of words in each mark offers "a different
denotative or connotative meaning." IcL at 413.
UHS logo bears resemblance to UHS Delaware's '433
word mark and '663 stylized mark against all sight,
sound, and meaning metrics. The marks contain the same three
capitalized letters-UHS-separated by neither punctuation nor
spacing and accompanied by no other text. Each mark differs
marginally in style: UHS Delaware's stylized mark
comprises three hollowed-out and rounded letters with no
attendant graphic, while United Health Services' logo
displays a solid, serif font accompanied by a small leaf
graphic in the upper left region of its letter "U."
The marks are otherwise indistinct. Read aloud, the marks
produce identical auditory impressions. As a result of their
simplicity, neither mark evokes a unique denotative or
connotative meaning in isolation.
record evidence concerning mark similarity is undisputed.
There exists near identity between the parties' marks.
United Health Services effectively concedes as much in its
briefing, rejoining only that "[similarity in name is
only the beginning of the analysis." (Doc. ...