Covertech Fabricating, Inc. v. TVM Building Products, Inc. (124 F. Supp. 3d 489, 2015)

MEMORANDUM OPINION AND ORDER

KIM R. GIBSON, District Judge.

I. INTRODUCTION

This matter comes before the Court upon conclusion of a bench trial held from October 20, 2014 until October 24, 2014. The parties filed their proposed findings of fact and conclusions of law on April 9, 2015. (ECF Nos. 96 and 97). The parties filed responses on May 21, 2015. (ECF Nos. 100 and 101). The matter is now ripe for disposition.

II.BACKGROUND

a. Procedural

Covertech Fabricating filed a complaint against TVM Canada and TVM Products in the Middle District of Pennsylvania on May 21, 2013. (ECF No. 1). Covertech filed a stipulation of dismissal without prejudice of its claims against TVM Canada on July 8, 2013. (ECF No. 11 at 3). The parties also stipulated to transfer the remainder of the action to the Western District of Pennsylvania pursuant to 28 U.S.C. § 1406(a). (ECF No. 12). The action was transferred to this judicial district on July 11, 2013. (ECF No. 13).

b. Jurisdiction and Venue

This Court has subject matter jurisdiction over the action pursuant to 28 U.S.C. § 1332(a)(2) and (c)(1) because the parties are of diverse citizenship and the amount in controversy exceeds $75,000, excluding interest and costs. (ECF No. 1 at 5). This Court also has subject matter jurisdiction over the claims pursuant to 28 U.S.C. §§ 1331, 1338(b), and 15 U.S.C. § 1121 because this action involves claims for infringement of a federally registered trademark in violation of Section 32 of the Lanham Act, 15 U.S.C. § 1114; for federal unfair competition in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a); and for dilution of a federally registered trademark in violation of § 43(c) of the Lanham Act, 15 U.S.C. § 1125(c). This Court also exercises supplemental jurisdiction over Plaintiffs state law claims pursuant to 28 U.S.C. § 1367 because they form part of the same “case or controversy” under Article III of the United States Constitution.

Venue is proper in this judicial district pursuant to 28 U.S.C. § 1391(b)(1) because TVM is subject to personal jurisdiction here under 28 U.S.C. § 1391(b)(2), and because a substantial part of the events or omissions giving rise to the claims arose in the Western District of Pennsylvania.

III. LEGAL STANDARD

Pursuant to Rule 52(a) of the Federal Rules of Civil Procedure, the court may enter judgment following a trial without a jury. See Fed. R. Civ. P. 52(a). In making a decision following a bench trial, “[t]he court must find the facts specially and state its conclusions of law separately.” Id.; see also In re Frescati Shipping Co., Ltd., 718 F.3d 184, 196 (3d Cir.2013). Accordingly, the court will discuss its factual findings and then proceed to conclusions of law.

IV. FACTUAL FINDINGS

a. The parties involved

i. Covertech Fabricating, Inc.

The Plaintiff in this matter is Covertech Fabricating, Inc. (“Covertech”), a Canadian corporation with its principal place of business in Toronto, Ontario, Canada. (ECF No. 87, Trial Tr., at 40:3-4).

The President and owner of Covertech is Furio Orologio. (ECF No. 90, Trial Tr., at 211:11). Mr. Orologio has been an owner and the President of Covertech since its inception in 1990. (Id. at 211:16-18). He oversees every aspect of running the company, including the financials, banking, production and sales. (Id. at 211:19-21). Jonathan Starr is the Vice President and an owner of Covertech. He has been with Covertech since 1990 and is presently responsible for the sales and marketing aspects of the company. (ECF No. 87, Trial Tr., at 40:1). Peter Clarke works for Covertech and is responsible for sales in Canada and the northeast United States. (ECF No. 88, Trial Tr., at 4:19-22). Prior to working for Covertech, Mr. Clarke was employed by TVM as Vice President of Sales in Canada from June 2005 through May 31, 2009. (Id. at 30:13-15). Kelly Myers is the National Sales Manager for Covertech and has been employed by Covertech for the past seven years. Prior to working for Covertech, he was employed at TVM from May 2000 through January 2006.. (Id. at 128:23-129:3).

ii. TVM Building Products, Inc.

The Defendant in this matter is TVM Building Products, Inc. (“TVM”). TVM is a distributor of specialty building products including insulation and sealants and maintains its principal office in Johnstown, Pennsylvania. (ECF No. 89, Trial Tr., at 89:6-8).

Michael Boulding has been the' President of TVM Building Products since its inception in 1998. (Id. at 7:3—8:5). In about 1998, Mr. Boulding met with Mr. Orologio to discuss the marketing of Covertech’s products by TVM. (ECF No. 90, Trial Tr., at 219:11-220:19). At that time, TVM was a marketing company. (ECF No. 87, Trial Tr., at 47:19-48:2). TVM did not manufacture any insulation products. (ECF No. 89, Trial Tr., at 15:5-7).

b. Covertech’s Reflective Insulation and Protective Packaging Business

Covertech . manufactures protective packaging and. reflective insulation. (ECF No. 87, Trial Tr., at 40:17-23). Covertech extrudes polyethylene film and converts it into different products. (Id.). Covertech manufactures and sells extruded film, various protective packaging products, such as bubble wrap, and various products relating to reflective insulation, which are polyethylene bubble products with foil facings laminated to them. (Id. at 40:18-41:4).

Covertech began manufacturing reflective insulation products in the mid-1990s and sells its products in the United States, Canada, and around the world. (Id. at 41:5-9). Covertech started manufacturing and selling reflective insulation in 1994 or 1995 to be used on walls, ceilings, floors, and around ductwork. (Id. at 41:10-15). Covertech began selling reflective insulation products in the United States in 1998 or 1999. (Id. at 47:12-15).

c. Reflective insulation

Covertech’s reflective insulation product is called rFOIL. (ECF No. 87, Trial Tr., at 41:20-22). Covertech has been using the rFOIL mark in interstate commerce since about 1998. (Id. at 14:4-6). The mark has been associated with Covertech products since then. (Id. at 53:22-24). Covertech has been using the rFOIL mark continuously throughout the United States since 1998 and it uses it today. (Id. at 66:25-67:7). Covertech came up with the name rFOIL. It developed the name with a marketing company prior to working with TVM. (Id. at 62:2-4).

Covertech sells its reflective insulation products under its rFOIL brand. (Id. at 41:23-42:7). Covertech has a number of different product names that it sells under the rFOIL brand, including ULTRA NT RADIANT BARRIER, NT RADIANT BARRIER, CONCRETE BARRIER FOIL, CONCRETE UNDERPAD, and ULTRA CONCRETE UNDERPAD. (Id.).

Pursuant to an application filed by Covertech on September 18, 1997, the United States Patent and Trademark Office (“USPTO”) added the trademark rFOIL to its principal register on April 17, 2001 as Reg. No. 2,444,633. (ECF No. 97 at 5, citing Exs. 1,114, ¶ 1). The rFOIL trademark is incontestable pursuant to 15 U.S.C. § 1065. (Id., citing Exs. 1, 114, ¶2), After Covertech had registered the rFOIL mark, Covertech immediately told TVM about it. (Id. at 66:15-24).

d.CONCRETE BARRIER

Covertech has been using the CONCRETE BARRIER mark in interstate commerce since about 1998. (ECF No. 87, Trial Tr., at 58:10-24). Covertech has used the mark continuously throughout the United States since 1998 and uses it today. (Id. at 66:25-67:7). Covertech’s CONCRETE BARRIER products are also referred to as CBF, which stands for CONCRETE BARRIER Foil. (Id. at 52:19-23, 53:18-20). Covertech has sold millions of dollars of its CONCRETE BARRIER produet in the United States. (Id. at 74:2— 4). According to Covertech’s National Sales Manager, Kelly Myers, the CONCRETE BARRIER product is “huge” and one of Covertech’s “marquee products.” (ECF No. 88, Trial Tr., at 147:22-148:10).

Covertech registered the trademark “CONCRETE BARRIER” with the USP-TO by filing an application on June 17, 2003. (Joint Stipulation, ECF No. 79 at 1). The mark was added to the supplemental register on September 20, 2005 as Reg. No. 2,999,338. (Id.; Exs. 3, 114 ¶ 3). Pursuant to an application filed by Cover-tech on September 10, 2013, the USPTO added the trademark CONCRETE BARRIER to its principal register on June 3, 2014 as Reg. No. 4,542,586. (Id.; Exs. 2, 114 ¶ 4).

After Covertech had registered the CONCRETE BARRIER mark, it immediately told TVM about it. (ECF No. 87, Trial Tr., at 66:15-24). Covertech sells its CONCRETE BARRIER product using the product number 1620. (Id. at 45:3-7; Ex. 117). Since Covertech began using that number, it has always been associated with Covertech’s CONCRETE BARRIER product. (Id. at 70:3-5).

e.ULTRA CONCRETE UNDERPAD and CONCRETE UNDERPAD

Covertech has been using the CONCRETE UNDERPAD and ULTRA CONCRETE UNDERPAD marks in interstate commerce since about 2003,or 2004. (Id. at 53:10-24, 83:11-13). The marks have been associated with Covertech products since then. (Id.). Covertech has been using the CONCRETE UNDERPAD mark continuously .throughout the United States since then and still uses it today. (Id. at 83:23-25). The product number associated with Covertech’s CONCRETE UNDERPAD mark is 4620, and the product number associated with Covertech’s ULTRA CONCRETE UNDERPAD mark is 4320. (Id. at 45:8-9, 46:1-7; Exs. 118, 119). Covertech has sold millions of dollars using the CONCRETE UNDERPAD marks over the years. (Id. at 86:1-3).

f.ULTRA NT RADIANT BARRIER and NT RADIANT BARRIER

Covertech filed an application with the Canadian Intellectual Property Office on July 6, 2009, to register the trademark “ULTRA' NT RADIANT BARRIER.” The Canadian Intellectual Property Office registered the trademark on October 13, 2010. (Joint Stipulation, ECF No. .79 at 2). On July 8, 2010 Mr. Starr told Mr. Boulding that the Canadian Intellectual Property Office had granted Covertech the trade name ULTRA NT RADIANT BARRIER in Canada. (ECF No. 97, Trial Tr., at 113:17-114:8).

TVM filed an application on March 30, 2011 with the United States Patent and Trademark Office (“USPTO”) to register the trademark “ULTRA NT RADIANT BARRIER,” which was added to the principal register on January 17, 2012 as Reg. No. 4,086,776. (Joint Stipulation, ECF No. 79 at 2). Pursuant to an application filed on the same day, TVM is also the registered owner of the trademark “ULTRA NT SCIF BARRIER,” which was added to the USPTO’s principal register on January 17, 2012. (Id.).

NT RADIANT BARRIER and ULTRA NT RADIANT BARRIER are brands used for Covertech products that keep radiant heat out of attics. Covertech’s ULTRA NT RADIANT BARRIER product is also used in SCIF applications, which are sensitive compartmental information facilities. (ECF No. 87, Trial Tr., at 74:5-13; Exs. 115, 116). In addition, Covertech’s ULTRA NT RADIANT BARRIER product is used to help keep electronic signals from coming in or out of a building. (Id. at 43:21-44:3). Covertech developed and used the ULTRA NT RADIANT BARRIER brand. (Id. at 106:7-17).

The product number associated with Covertech’s NT RADIANT BARRIER mark is 4800, and the product number associated with Covertech’s ULTRA NT RADIANT BARRIER mark is 1800. (Id. at 74:14-19). The NT RADIANT BARRIER and ULTRA NT RADIANT BARRIER marks have been used continuously in the United States by Covertech since at least as early as 2003, and Covertech still uses them today. (Id. at 53:1024; 74:18-23, 107:10-111:23; Exs. 5, 6, 81). ' Cover-tech has sold hundreds of thousands of dollars of its ULTRA NT RADIANT BARRIER product. (ECF No. 87, Trial Tr., 82:16-19). Covertech’s ULTRA NT RADIANT BARRIER product is specified by the United States government for use in SCIF applications in government buildings. (Id. at 120:21-124:13; Exs. 15, 16).

Other than in connection with TVM’s distribution of Covertech’s products, Covertech never gave permission to TVM to use the ULTRA NT RADIANT BARRIER mark in the United States. (ECF No. 87, Trial Tr., at 57:6-9,114:22-24).

g. Product Numbers

TVM developed a product numbering system to replace Covertech’s existing product numbering system which was not able to handle the additional product lines. (ECF No. 89, Trial Tr., at 31:7-33:1). According to Mr. Orologio, he initiated the development of the new codes because there were errors in the orders coming to Covertech. (ECF No. 90, Trial Tr., at 226:25-228:13; ECF No. 91, Trial Tr., at 64:6-65:19). The product numbering system was developed at TVM’s offices in Erin, Ontario- over a period of a couple months by Mike Boulding and other TVM employees, including Peter Lister and Mike Tipan. (ECF No. 89, Trial Tr., at 30:16-19; 34:23-25). Mr. Orologio testified at trial that when the new codes were adopted, he did not care what the specific numbers were. He simply wanted the errors to be eliminated. (ECF No. 91, Trial Tr., at 64:6-65:19).

The first digit of the product numbering system indicated the brand, the second described the product; the third indicated the number of layers of bubbles, and the fourth digit indicated whether the product was square edge, one tab, two tabs or a quick seam. The next two numbers indicated the width and length of the product. (ECF No. 89, Trial Tr., at 33:2-34:3).

h. Covertech’s Marketing Efforts

Covertech advertises its marks extensively by using the marks in its literature, brochures, technical data sheets, price sheets, and invoices. Covertech also advertises in magazines, goes to trade shows, and uses them on its website, www.rFOIL. com. (ECF No. 87, Trial Tr., at 67:8-14, 86:15-19, 68:9-14; ECF No. 88, Trial Tr., at 138:16—139:3, 159:17-24). Covertech was and is trying to sell its products in the same market and to the same customers as TVM. (ECF No. 87, Trial Tr., at 133:25-134:5). Covertech and TVM use the same channels to market them respective products. They market online, to distributors, and to wholesalers. (Id. at 134:5-7). Covertech’s rFOIL products and the products sold by TVM are used for the same functions. (Id. at 134:8-12). Covertech uses the marks and product numbers on the product it sells. The marks are on the product labels. (Id. at 67:15-24; Exs. 13. 95, K). Covertech uses the marks and product numbers on price sheets and order forms. (ECF No. 97, Trial Tr., at 72:6-8).

Covertech has used the same part number, product descriptions and upgraded literature since 2005. (ECF No. 88, Trial Tr., at 36:2-13).

i. Commercial Strength of Covertech’s Marks

Covertech has sold “millions and millions of dollars’ worth” of rFOIL branded product in the United States. (ECF No. 87, Trial Tr., at 73:23-74:1). Dan Higgins (“Higgins”), the owner of Willow Springs, S.R.A., LLC in Wittenberg, Wisconsin, testified that he was familiar with Cover-tech’s rFOIL product line and the Cover-tech product numbers. (ECF No. 88, Trial Tr., at 93:11-15, 94:24-95:16). Willow Springs is a sales rep agency and distributor of hydronic heating components to the HVAC and plumbing industries. (Id. at 93:16-19). Willow Springs has purchased rFOIL that was manufactured by Cover-tech. (Id. at 95:12-14). Higgins testified that he believed rFOIL products were quality products and that the source of material that he bought was important to him. (Id. at 96:12-14,103:18-19).

Covertech’s customers associate the rFOIL brand with Covertech. They also associate CONCRETE BARRIER, NT RADIANT BARRIER, ULTRA NT RADIANT BARRIER, CONCRETE UN-DERPAD, and ULTRA CONCRETE UN-DERPAD with Covertech. (Id. at 107:2-12). Covertech’s customers refer to Covertech’s rFOIL products by using the product number or the marks. (Id. at 108:13-109:1).

j. The Exclusive Distribution Agreement

In or about 1998, Mike Boulding and Furio Orologio met to discuss forming a relationship between TVM and Covertech. TVM and Covertech entered into an agreement that they both referred to as the exclusive distribution agreement. Cover-tech agreed to manufacture on an exclusive basis for TVM in the United States and TVM agreed to sell and market Cover-tech’s products on an exclusive basis in the United States. (ECF No. 87,. Trial Tr., at 48:16-21; ECF No. 89, Trial Tr., at 12:3-9; ECF No. 1 at ¶2; ECF No. 35 at ¶2).

Both parties were aware of an exception to the exclusive distribution agreement in the United States relating to a company called Fi-Foil, which asked Covertech to sell reflective insulation directly to it. Covertech sold product to Fi-Foil and paid TVM a commission on all of its sales to FiFoil, even though TVM was not involved in the sales. (ECF No. 87, Trial Tr., at 50:25-52:2, 144:12-19; ECF No. 89, Trial Tr., at 66:4:15, 67:24-68:1; ECF No. 90, Trial Tr., at 15:22-17:5; ECF No. 91, Trial Tr., at 10:13-19,131:21-23).

Pursuant to the agreement, Covertech was responsible for manufacturing. (ECF No. 87, Trial Tr., at 48:18-49:10). TVM was responsible for all sales, marketing equipment, literature, brochures, and other marketing materials, tradeshows, orders, and setting up representatives. (ECF No. 88, Trial Tr„ at 136:6-7; ECF No. 89, Trial Tr., at 26:23-27:2; ECF No. 90, Trial Tr., at 18:13-20; Ex. 113; ECF No. 88, Trial Tr., at 9:4-14).

Covertech did not interact with customers. (ECF No. 90, Trial Tr., at 11:11-16). The customers who did call Covertech were redirected to TVM. (Id., at 232:16-22). Mr. Boulding directed Covertech to send all technical inquiries from customers to TVM’s engineer and product manager. (Id., at 10:3-11; 232:6-25; 245:10-21). Covertech expected TVM to sell, advertise and attend trade shows and to answer all technical and installation questions. (Id., at 224:2-13). TVM was responsible for providing technical support, to the «customers, hiring engineers, and ensuring compliance with regulations in the market, such as the different fire codes. (ECF No. 90, Trial Tr., at 223:16-224:24, 230:25-231:8).

TVM was responsible for developing new marketing material, though much of what it produced was based on information, photographs, drawings and other material that was provided by Covertech. (ECF No. 89, Trial Tr., at 19:19-22, 20:5-9, 21:10-24, 22:21-24, 24:16-22, 45:24-46:3, 69:13-14, 214:16-24, 217:19-23, 247:16-25, 248:1-24, 248:1-249:17, 255:3-17; ECF No. 91, Trial Tr., at 28:19-29-9).

Generally, all of the marketing material and literature that TVM created required Covertech’s approval. If Covertech did not approve the material, then TVM would modify it. (ECF No. 89, Trial Tr., at 38:13-16, 39:4-19, 46:4-12,' 71:23-72:8, 73:20-74:5, 78:15-79:2, 219:6-11; ECF No. 91, Trial Tr., at 42:19-43:4, 62:11-15, 63:17-20).

TVM’s salespeople targeted the customers, made sales calls and gave presentations and product sessions. (ECF No. 88, Trial Tr., at 13:9-14). TVM also had discretion regarding whom they would sell a product to, and had discretion to refuse to sell a particular product to a particular customer. (ECF No. 90, Trial Tr., at 11:20-12:3).

Other than TVM’s largest customer, Bay Industries (“Bay”), TVM has. not disclosed the identity of its customers to Covertech. (Id. at 224:4-8, 245:10-21).

For a while, both parties benefited from the exclusive distribution agreement. because Covertech had nobody else to take its product line to the U.S. marketplace, Covertech was giving up access to the U.S. marketplace and was giving up selling to anyone other than TVM. (ECF No. 87, Trial Tr., at 48:22-25, 49:28-25).

TVM was compensated by being the exclusive distributor of the product line and by getting Covertech’s products at a very good price, which it would then, mark up for sale in the. United. States. (ECF No. 87, Trial Tr., at 50:1-6; ECF Ño. 88, Trial Tr., at 11:22-12:6; ECF No. 88 136:17-20; ECF No. 90, Trial Tr., at 223:16-23, 224:25-225:10).

Under the agreement, TVM was to go to the United • States market to determine what the competition was selling, educate itself in the product line, get pricing from distributors, and report back to Mr. Orologio. (ECF No. 91, Trial Tr., at 36:13-18).

For new markets and applications, TVM would identify the applicable codes and determine if certification of the product was required. It would convey that information to Covertech, who would develop a product to meet those' codes and the product tested. Once the product was approved, Covertech would send the test results to TVM to'put the information in the product literature. (ECF No. 91, Trial Tr., at 122:10-123:16).

Pursuant to the agreement, TVM sold Covertech’s rFQIL products, including ULTRA NT RADIANT BARRIER, NT RADIANT BARRIER, CONCRETE BARRIER FOIL, CONCRETE UNDER-PAD, and ULTRA CONCRETE UNDER-PAD. (ECF No. 87, Trial Tr., at 52:3-9). Under the exclusive distribution agreement, TVM was allowed to use Covertech’s names in selling Covertech’s products. (Id. at 57:6-9; 75:8-19). From 1998 until 2006; Covertech sold over $40 million of product to'TVM.,(Ex. 24; ECF No. 87, Trial Tr., at 137:8-20).

k. Termination of the Exclusive Distribution Agreement

The parties agreed to terminate the exclusive distribution agreement in October 2007. (ECF No. 89, Trial Tr., at 99:18-22). Beginning in December 2006 TVM began pm-chasing reflective insulation from Reflectix in addition to buying from Covertech. (Id. at 90:8-91:15). At the time that the exclusivity arrangement was terminated, TVM was buying product from both Covertech and Reflectix. (Id. at 109:2-5). TVM purchased product from Reflectix as well as from Covertech 'from 2006 through 2009. (Id. at 137:14-18).

Covertech gave two reasons for the termination of the exclusive distribution agreement. First, Covertech stated that TVM was having difficulty paying its bills to Covertech. (ECF No. 90, Trial Tr., at 233:7-14). TVM was having difficulty paying its bills to Covertech. (ECF No. 90, at 233:7-14). TVM’s payment terms were net60, which meant that payment was due to Covertech 60 days after the product was shipped. (ECF No. 88, Trial Tr., at 219:23-220:6). TVM began to have a large amount of invoices outside of net60, totaling around $1.2 million. (ECF No. 88, Trial Tr., at 220:22-25). TVM did not pay Covertech any interest on these overdue invoices. (ECF No. 90, Trial Tr., at 27:20-23). Covertech and TVM took steps to reduce the outstanding balance, though the problem was not resolved entirely. (ECF No. 87, Trial Tr., at 56:24-57:5; ECF No. 88, Trial Tr., at 220:22-221:20).

Second, Covertech discovered that TVM had been buying product from another, manufacturer, Reflectix, and selling it using Covertech’s brand names and trademarks. (ECF No. 87, Trial Tr., at 54:14-24). Covertech discovered that TVM had-been passing off another manufacturer’s product as Covertech product from its customer, Willow Springs. Willow Springs had received product from TVM that was unlike product it had seen when given a tour of the Covertech manufacturing facility. When Willow Springs was unable to receive a straight answer from TVM, it inquired with Covertech. Covertech informed Willow Springs that they had not manufactured thé product that had been sent to Willow Springs. (ECF No. 88, Trial Tr., at 98:13-99:19,100:2-102:23; Ex. 75). Covertech also related another incident in which TVM’s Kansas City warehouse had sent out another manufacturer’s product without relabeling it. --(ECF No. 88, Trial Tr., at 24:23-25:9).

Mr. Boulding conceded that the millions of dollars of product that TVM purchased from Reflectix in 2006 and 2007 was contrary to TVM’s agreement with Covertech. (ECF No. 90, Trial Tr., at 24:12-25).

1. Private label arrangement

After Covertech and TVM terminated the exclusive distribution agreement, the parties entered into a private label arrangement, under which Covertech manufactured product for TVM that TVM sold under the TVM brand. (ECF No. 90, Trial Tr., at 94:22-95:1). Mr. Boulding testified that TVM would buy Covertech product packed in a TVM bag, under a TVM label, and ship it to customers, and that TVM would no longer buy or represent in any way the rFOIL brand. (ECF No. 89, Trial Tr., at 94:24-95:1). Mr. Boulding also testified that TVM “had no right to the rFOIL brand name after the exclusive distribution agreement ended.” (ECF No. 89, Trial Tr., at 110:15-19).

According to Covertech; it was not happy with the new arrangement, because it had worked hard with the rFOIL branding of the product and it was doing well -in the U.S. marketplace. (ECF No. 87, Trial Tr., at 55:24-56:4). John Starr testified that Covertech went along with the arrangement because the company had its “hands tied” by TVM, which owed Covertech more than a million dollars. (Id. at 56:5-13). Despite the private label- arrangement, TVM was still buying and selling some Covertech reflective insulation using Covertech’s rFOIL brand, (ECF No. 90, Trial Tr., at 240:9-10). Mr. Orologio testified that Covertech did not allow TVM to private label Covertech’s CONCRETE BARRIER or CBF product, which was a patented Covertech product, but TVM could still market it and sell it as rFOIL. (Id. at 240:14-241:8).

Mr. Orologio also stated that Covertech made it clear that it had every intention to continue to promote rFOIL. (Id. at 238:10-17). Covertech essentially started its distribution from scratch by hiring salespeople, including Peter Clarke and Kelly Myers. Covertech also attended tradeshows and took on everything that TVM did when it first started selling rFOIL in the United States: (Id. at 238:18-20; ECF No. 88, Trial Tr., at 4:15-22).

Under the private label arrangement, TVM was allowed to use the Covertech' brand names and code numbers, so long as it was for Covertech’s material. (ECF No. 87, Trial Tr., at 57:10-12; ECF' No. 90, Trial Tr., at 240:9-13). Due to the private label arrangement, the warranty on the private label products was a TVM warranty. (ECF No. 90, Trial Tr., at 236:21-24, 237:7-12).

Around the time that the private label agreement was instituted, the volume of purchases from Covertech by TVM declined significantly. Covertech sold only $10 million of reflective insulation to TVM from 2007 to 2010. (Ex. 24; ECF No. 87, Trial Tr., at 137:8-20).

TVM stopped buying product from Covertech in 2010 or early 2011. (ECF No. 89, Trial Tr., at' 136:18-22). Covertech stopped selling product to TVM and TVM no longer purchased products from Cover-tech. (ECF No.' 90, Trial Tr., at 175:8-12; ECF No. 91, Trial Tr., at 79:6-20).

Covertech learned that between 2006 and 2009, TVM purchased more than $2.2 million of reflective insulation products form Reflectix, and between 2009 and 2013, TVM purchased nearly $8 million of reflective insulation products from Soprema. (ECF No. 90, Trial Tr., at 48:8-23, 51:8-54:13; Exs. 28,29, 31-36).

Between 2006 and 2010 TVM told Covertech that TVM was not buying product from competitors. (ECF No. 87, Trial Tr., at 60:21-24).

TVM and Covertech are direct competitors in the marketplace today. (ECF No. 89, Trial Tr., at 202:2-4).

m. TVM’s Use of Covertech’s Marks

Covertech has lost a lot of money because of TVM’s actions, because, as John Starr testified, Covertech is now “competing against itself.” (ECF No. 87, Trial Tr., at 88:17-89:4). TVM led customers to believe that it was the manufacturer of the rFOIL products. (ECF No. 88, Trial Tr., at 137:4—20). In some instances, TVM even specifically claimed to be the manufacturer. (ECF No. 90, Trial Tr., at 30:13-31:11; ECF No. 91, Trial Tr., at 238:14-245:5; ECF No. 88, Trial Tr., at 79:10-80:17). Mr, Boulding also improperly told customers that he owned part of Covertech. (ECF No. 88, Trial Tr., at 97:5-13).

TVM also tried to pass off other manufacturers’ products as Covertech’s rFOIL products to other customers, such as BCI and Metal Building Supply. (ECF No. 88, Trial Tr., at 162:3-167:15). Covertech learned about TVM’s improper use of Covertech’s mark through the industry. (ECF No. 87, Trial Tr., at 92:8-19). Mr. Starr told Mr. Boulding several times to stop using Covertech’s product names and product numbers. (ECF No. 87, Trial Tr., at 168:17-25,177:25-178:7, 206:17-20).

As of Mary 1, 2013, TVM was selling products on the www.tvmbuildingproducts. com website using the rFOIL, CONCRETE BARRIER, CONCRETE UN-DERPAD, and ULTRA CONCRETE UNDERPAD marks. (Exs.99, 78). TVM improperly used Covertech’s ULTRA NT RADIANT BARRIER mark from 2010 to 2013, despite being aware that Covertech had used the mark for its products long before then. (ECF No. 87, Trial Tr., at 105:24-106:6; Ex. 5).

Covertech introduced evidence at trial that TVM used Covertech’s marks on TVM’s website from 2009 through 2013. (ECF No. 87 at 93:5-94:20; Exs. 19, 67, 87, 93). Among the evidence introduced at trial of TVM’s improper use of Covertech’s rFOIL mark were Exhibits 67, 78, 96, 99, and 122 and the testimony related thereto. Among the evidence introduced at trial of TVM’s improper use of Covertech’s ULTRA NT RADIANT BARRIER mark were Exhibits 11,17,19, 69, 70, 72, 84, and 87 and the testimony related thereto. Among the evidence introduced at trial of TVM’s improper use of Covertech’s CONCRETE BARRIER mark were Exhibits 67, 69, 70, 78, 84, 87, 96, 99, 103, and 122 and the testimony related thereto. Among the evidence introduced at trial of TVM’s improper use of Covertech’s CONCRETE UNDERPAD and ULTRA CONCRETE UNDERPAD marks were Exhibits 67, 69, 70, 84, 87, 93, 96, and 103 and the testimony related thereto. Covertech did not give TVM permission to use the marks on other companies’ products and Covertech did not receive any money from TVM’s sales of those products. (Id. at 94:15-20).

TVM also improperly used Covertech’s CBF (CONCRETE BARRIER), CONCRETE UNDERPAD, and ULTRA CONCRETE UNDERPAD marks and corresponding product numbers in TVM’s 2011 product catalog. (Ex. 70; ECF No. 87, Trial Tr., at 94:23-95:6). This same catalog also uses the 1800 and 4800 product numbers. TVM improperly used Cover-tech’s marks and product numbers in other advertising and product literature. (See Exs. 5, 69, 70, 84,102, 122. 14). TVM also improperly used Covertech’s marks and product number in TVM’s price lists. (ECF No. 87, Trial Tr., at 125:25-127:25; Ex. 103).

In addition, TVM improperly marketed its products with Covertech’s marks on the www.tvmbuildingproducts.com and www. tvmi.com websites. (ECF No. 87, Trial Tr., at 128:16-25; ECF No. 91, Trial Tr., at 43:7-15; Exs. 17, Y). From 2010 to the present, Covertech had no relationship with TVM and Covertech was not paid by TVM for its use of these marks. (ECF No. 87, Trial Tr., at 91:11-92:4). Cover-tech never gave permission to TVM to use Covertech’s marks or Covertech’s product numbers with product that was not manufactured by Covertech. (Id. at 57:13-16).

In about 2010, Covertech found out about TVM’s purchases from Reflectix and Soprema from a deposition in the Mueller case, which involved warranty claims involving reflective insulation. (ECF No. 87, Trial Tr., at 59:20-60:8). If Covertech had known about those purchases earlier, it would have stopped its relationship with TVM sooner. (Id. at 60:11-20). Mr. Starr explained that the situation “wasn’t right. I mean, we had put a lot of money, effort, and time into the rFOIL brand name. It was something that we owned, and they were substituting somebody else’s product. So we were losing a tremendous amount of sales on our own brand names.” (Id. at 61:10-17). Customers have been confused by TVM’s use of Covertech’s marks. Customers see the products on TVM’s websites.and when they call Covertech, Cover-tech has .had to explain that it is not selling those products. Customers ask why Covertech is .allowing TVM to use its marks and Covertech has had to explain that it was not permitting them- to use the marks. (ECF No. 87, Trial Tr., at 135:8-136:16). As an example, Mr. Starr identified a company called Crossroads that experienced such confusion. (Id.)

Mr. Orologio also testified that Cover-tech’s customers were being confused by TVM’s actions. He described it as a “battle” so that all of the customers understand that TVM is no longer buying Covertech product. (ECF No. 90, Trial Tr., at 242:16-243:12). Mr. Clarke testified to instances of actual confusion as well.. The first involved a company in Long Island called Worldwide Plumbing, which called him. Worldwide Plumbing was trying to buy CONCRETE UNDERPAD and Mr. Clarke gave them a quote. The customer said it had a quote for the exact same product name.and number from TVM that was less expensive. Mr. Clarke had to explain who TVM is and why that product from TVM is not manufactured by Cover-tech. (ECF No. 88, Trial Tr., at 38:5-39:17).

Mr. Clarke- also discussed confusion caused by a distributor called Can-Cell that was using Covertech’s product numbers to sell TVM’s products because Mr. Boulding told Can-Cell it was allowed to do so. One of Covertech’s customers, Home Hardware, would call Covertech and say-that Home Hardware could get the exact same product from Can-Cell. Mr. Clarke would then need to explain that it was not Covertech’s product, but a . different product altogether. That confusion by Home Hardware was still ongoing at the time of trial. (Id. at 39:18-41:8).

Mr. Clarke has had to field phone calls and try to explain the situation to customers. Covertech also put out a press release about TVM’s unauthorized use of the marks and product numbers. Every time a customer is confused, Mr. Clarke sends the customer a copy of the press release. In his words, he uses the press release “all. the time.” (ECF No. 88, Trial Tr., at 43:13-44:13; Ex. 123). The confusion is particularly problematic because of the historical relationship between TVM and Covertech, and because the industry used to buy Covertech’s products from TVM. (ECF No. 87, Trial Tr., at 136:17-137:5).

When asked about whether other companies use Covertech’s names and product numbers, Mr. Starr explained that if they are buying Covertech’s product, they are. authorized to use Covertech’s product names and numbers. If they are not buying Covertech’s product, Mr. Starr will act to stop the usage. (Id. at 169:5-11).

For example, Mr. Starr was asked about, a company called Thermo that markets CONCRETE BARRIER foil and uses Coverteeh’s product numbers. Mr. Starr explained that Thermo is a distributor of Covertech. (Id. at 179:23-180:3). Similarly, Mr. Starr discussed a Covertech distributor called Ecofoil, and how Covertech makes it known to the industry that if you want to buy Covertech’s ULTRA NT RADIANT BARRIER product, you can go to Ecofoil to get it. (Id. at 174:24-125:6).

Mr. Starr and Mr. Clarke were asked about othér examples of Covertech’s mark being used on the internet. Mr. Starr and Mr. Clarke testified that, in the U.S., all of the uses were either by an authorized user (such as a Covertech distributor), or were unauthorized uses by TVM or one of TVM’s distributors or suppliers. (Id. at 218:13-17; ECF No. 88, Trial Tr., at 46:18-49:5). Mr. Boulding testified that the www.tvmbuildingsproducts.com website, which improperly marked TVM products with Covertech’s marks, is administered by one of TVM’s distributors who buys from TVM and sells to the online customers. (ECF No. 89, Trial Tr., at 111:2-20). Mr. Boulding also stated .that TVM had reached an agreement with the distributor to have it handle the commerce site for TVM. (Id. at 114:1-4).

Mr. Boulding stated that the tvmbuildinproducts.com website is one of the ways that TVM promotes its products. (ECF No. 90, Trial Tr., at 34:23-25). On that website are TVM’s name, logo, mission statement, and a section about TVM Building Products. (Id. at 35:9-24; Ex. Í31). TVM’s corporate website, www.tvmi.cdm, contains a link to the www.tvmbuilding products.com website. (Id. at 36:10-37:1; Ex. 73).

Mr. Boulding also stated that he could call up the distributor, Michael Thrift, and have him change content on the site and remove references to rFOIL, which Mr. Boulding actually did during the trial. (ECF No. 89, Trial Tr., at 114:6-12; ECF No. 90, Trial Tr., at 32:21-34:16). Mr. Boulding says that he speaks to Mr. Thrift every day. (ECF No. 90, Trial Tr., at 34:7).

Mr. Boulding paid an employee of Mr. Thrift to run some searches for use at trial. (ECF No. 90, Trial Tr., at 38:16— 39:10). In other words, Mr. Boulding paid an employee of Michael Thrift to search for instances where third parties were using Covertech’s marks. The selective results did not include the use of the marks on www.tvmbuildingproducts.com. (ECF No. 90, Trial Tr., at 38:23-39:10). Exhibit 24 shows the amount of product TVM purchased from Covertech from 1998 until 2010, broken down by' year. (Ex. 24; ECF No. 87, Trial Tr., at 137:8-20).

Exhibit 25 shows TVM’s sales to its customers in the metal building industry. (ECF No. 89, Trial Tr., at 202:25-206:2). TVM’s sales from 2009. to 2013 total $5,791,92. (Ex. 25). Exhibit 26 shows TVM’s sales of the 1800 ULTRA NT RADIANT BARRIER from 2006 through 2013. (Ex. 26; ECF No. 90, Trial Tr., at 44:18-45:3). TVM’s sales of ULTRA NT RADIANT BARRIER between 2010 and 2013 total $369,014. (Ex. 26),

n. TVM’s Registration of the ULTRA NT RADIANT BARRIER Trademark

A few months after Covertech registered ULTRA NT RADIANT BARRIER as its trademark in Canada, TVM filed an application with the USPTO to register ULTRA NT RADIANT BARRIER as a trademark in the United States. (Exs.4, 11). The registration was done by and for TVM, not Covertech. (Ex. 11; ECF No. 87, Trial Tr., at 114:25-115:5).

In connection with the application, TVM submitted a Response to Office Action on September 9, 2011, stating that:

The applicant is using the mark in commerce, or the applicant’s related company or licensee is using the mark in commerce, on or in connection with the identified goods and/or services. 15 U.S.C. Séction 1051(a) as amended. The mark was first used at least as early as 06/01/2006 and first used in commerce at least as early as 06/01/2006, and is now,in use in such commerce.

(Ex. 11, Response to Office Action dated 9/9/2011). TVM also submitted a declaration that was electronically signed by Mr. Boulding on September 9, 2011, in which he stated that “[t]he undersigned, being hereby warned that willful false statements and the like so made are punishable by fine or imprisonment, or .both, under 18 U.S.C. Section 1001, and that such willful false statements may jeopardize the validity of the application or any resulting registration.” (Ex. 11; ECF No. 89, Trial Tr., at 126:7-9; ECF No. 90, Trial Tr., at 59:11-60:13; ECF No. 87, Trial Tr., at 118:6-16). Mr. Boulding stated that it was TVM’s “understanding that Covertech had abandoned the mark.” (ECF No. 90, Trial Tr., at 62:10-25).

Mr. Boulding conceded that the evidence at trial showed that Covertech is using ULTRA NT RADIANT BARRIER today and has been using it continuously since 2003. (ECF No. 90, Trial Tr., at 63:1-16). Mr. Boulding admitted at trial “that the statement that [he] signed under penalty of perjury in the USPTO is now false.” (ECF No. 90, Trial Tr., at 66:15-18). He also conceded that he has not submitted an amendment. (Id. at 66:19-21).

Pursuant to the application filed by TVM on March 30, 2011, the USPTO added the trademark ULTRA NT RADIANT BARRIER to its principal register on January 17, 2012 as Reg. No. 4,086,776. (Ex. 114, ¶ 6; Ex. 12).

Covertech filed its, own application to register the ULTRA NT RADIANT BARRIER mark, but the registration has not been approved because TVM had already registered the mark. (Ex. 132; ECF No. 87, Trial Tr., at 165:20-23). In connection with the application, Mr. Starr submitted a declaration in which he stated that he believed that Covertech was the owner of the mark and that Mr. Starr believed that no other entity had the right to use the mark. (Ex. EEEE).

The USPTO has placed Covertech’s application in suspense pending the termination of this civil action. (Ex. 132).

o.TVM’s Failure to Pay Covertech Invoices

TVM was often behind in the payment of invoices to Covertech for product that Covertech had shipped to TVM. Covertech was required to take steps to remedy the situation. (ECF No. 87, Trial Tr., at 56:24-57:5; ECF No. 88, Trial Tr., at 220:22-221:20). Mr. Szymanowski, Cover-tech’s comptroller, testified at trial that TVM owed Covertech $228,305.17 for the unpaid invoiced. (ECF Nq. 88, Trial Tr., at 231:1-9; Ex. 40). Mr. Boulding admitted at trial that TVM had not paid Cover-tech for these invoices. (ECF No. 89, Trial Tr., at 221:7-16).

p.TVM’s Credit Requests

Mr. Boulding testified at trial that TVM did not pay Covertech for the invoices listed on Exhibit 40 because there were credits due to TVM for warranty claims that had been approved by Covertech but not paid. He believed that the money TVM owed to Covertech was offset by money that Covertech owed to TVM. (ECF No. 89, Trial Tr., at 221:7-25). Mr. Boulding testified that all of these credit requests had been approved' by Covertech. (ECF No. 89, Trial Tr., at 221:17-21). TVM introduced no other supporting evidence on this point. On cross-examination, also Mr. Boulding conceded that some of the credit requests he identified had already been paid by Covertech. (ECF No. 90, Trial Tr., at 90:25-92:7).

q.TVM’s Failure to Pay Settlement Agreements Regarding Warranty Claims

In October 2010 and thereafter, TVM agreed to pay a portion of the settlements to resolve warranty claims for allegedly defective insulation submitted by Southern Structures, LLC (“Southern Structures”), Acadian Commercial, LLC (“Acadian”), Halpiris Flooring America (“Halpiris”), Marquis Building (“Marquis”), and Dayon. (ECF No. 1 at 1Í1Í63, 127; ECF No. 35 at ¶¶ 63,127; Exs. 21-23).

Mr. Szymanowski testified that for Southern Structures, Acadian, Halpiris, and Marquis, TVM agreed to pay a portion of those settlements, Covertech then paid the settlements to the claimants and obtained releases, but TVM has not paid its agreed upon contribution to (ECF No. 88, Trial Tr., at 231:10-240:2).

Mr. Szymanowski also testified about Exhibits 21, 22, and 23, which show that TVM agreed to pay a portion of those settlements; that Covertech then paid the settlements to the claimants and obtained releases; and that Covertech invoiced TVM for its portion of the settlement. (Id. at 235:2-240:2; Exs. 21-23).

Mr. Szymanowski further testified at trial that TVM had not paid its agreed upon contribution to Covertech. (ECF No. 88, Trial Tr., at 231:10-240:2). The total amount that TVM agreed to contribute to these settlements was $13,000. (Exs. 21— 23; ECF No. 88, Trial Tr., at 235:2— 239:8). TVM has not paid that money to Covertech. (ECF No. 88, Trial Tr., at 236:7-1; 238:17-18; 240:1-2). Mr. Boulding testified that while TVM had not paid Covertech for the Southern Structures, Acadian, Halpin’s, and Marquis claims, TVM had instead paid an entire claim for $15,000, though he did not remember whom that claim was paid to. (ECF No. 89, Trial Tr., at 220:10-11, 220:11-13). He testified that the $15,000 payment offset the $13,000 that TVM had agreed to pay. (Id. at 220:23-221:3). TVM provided no further evidence in support of that assertion.

r. TVM’s Counterclaim for Fraud

At some point in the 1990s, Covertech’s rFOIL product started to be used in the metal building industry. At some point, Covertech started to manufacture product with Fire Retardant (“FR”) in it, and the product could be used in metal buildings. (ECF No. 91, Trial Tr., at 52:15-22).

In 2004, TVM and Covertech received first reports of problems with rFOIL. The reports stated that rFOIL was degrading in certain applications. In-2004, there were at . least three reports of the product degrading when used in the roof of an open-sided building or porch. The product was becoming brittle and falling apart. (ECF No. 89, Trial Tr., at 141:22— 142:10, 144:7—145:17; ECF No. 91 at 9:7—16).

According to Mr. Orologio, both. TVM and Covertech knew in 2004 that the cause of the degradation could be UV. Mr. Orologio testified that there was a meeting in the spring or summer of 2004 with Mr. Boulding, Mike Dubreuil of Ampacet, the company that had provided’ the resin used by Covertech to make its polyethylene film, and himself. According to Mr. Orologio, they were told by Mr. Dubreuil that the cause of the degradation was exposure to UV light. Mr.' Orol.ogio testified that Mr. Boulding was skeptical of the conclusion. Mr. Orologio believed that Mr. Boulding would take steps to ensure that no one would apply the product under those conditions. (ECF No. 91, Trial Tr., at 10:5-13:20,14:20-15:11, 81:16-82:25).

Prior to the 2004 meeting with Mr. Dubreuil at Ampacet, Mr. Orologio did not know that the reflective insulation would degrade where it did not make direct contact with UV rays. (Id. at 22:20-23). Pri- or to 2004, Mr. Orologio also did not know that sunlight coming through small windows -would degrade the product, and he did not believe that UV bouncing off concrete would degrade product on the ceiling. (Id. at 22:24-23:30).

Mr. Orologio was asked why he, as the manufacturer, did not- stop selling the product to TVM and he explained that the product was being used for multiple purposes. It could be used behind drywall, in attic applications, and under concrete. The same product was used for multiple purposes. (ECF No. 91, Trial Tr., at 15:20-16-16,108:1-9; Ex. B).

TVM learned in 2004 that a UV additive could, be included in the product, but. did not request that it be included in the product. (ECF No. 90, Trial Tr., at 78:8-79:1; ECF No. 91, Trial Tr., at 148:6-14). Mr. Orologio testified that he told Mr. Boulding to make sure his customers did not use it for application where it would be subject to direct or indirect UV light. (ECF No. 91, Trial Tr., at' 131:10-18). Mr. Boulding stated that he knew that UV could cause white poly to degrade in 2005. (ECF No. 90, Trial Tr.; at 67:10-14).

Mr. Orologio was very upset when he learned there were more claims and he questioned Mr. Boulding about what had been done to prevent it from happening again. In 2004, Mr. Orologio had encouraged TVM. to communicate the issue to its customers. (ECF No. 91, Trial Tr., at 18:10-24).

Mr. Orologio met with Mr. Boulding on September 28, 2005, and demanded that Mr. Boulding inform the marketplace that the product could not be used where it was going to be exposed to UV light. Mr. Boulding prepared and sent out an Urgent Notice regarding degradation. (ECF No, 91, Trial Tr., at 19:1-4; Ex. NN2).

The Urgent Notice was ’titled Urgent Notice—Open Sided Building and it stated “Please be advised that TVM no longer recommends WHITE POLY-FACED rFOIL products, for use in open-sided buildings, overhangs, lean-to structures, or anywhere the while poly may be exposed to direct or reflected UV light.” The Urgent Notice also states that “This problem is not unique to rFOIL. Any polyethylene product can degrade when- exposed to UV radiation.” (Ex. NN2). According to Mr. Orologio, his discussion with Mr. Boulding was not limited to open-sided, buildings. (ECF No. 91, Trial Tr., 19:5-24).

According to Mr. Boulding, he thought the Urgent Notice had its intended effect because, to his recollection, there were , no claims in 2006. (ECF No. 89, Trial Tr., 170:7-171:2). According-to Mr. Boulding, TVM learned in December 2007 that the degradation was a bigger problem because they started to see the problem in enclosed buildings, i.e., metal buildings with walls, bay doors and skylights, for the first time. That was when the “light bulb” went off. (Id. at 118:1-21; .ECF No. 90, Trial Tr., at 83:9-20; ECF No. 91, Trial Tr., at-187:23-188:3; Ex. UU).

Mr. Boulding said that TVM had no record of UV damage in enclosed buildings, with walls and skylights, prior to 2007. (ECF No. 90, Trial Tr., at 85:2-86:15). However, at trial it was established that, contrary to Mr. Boulding’s recollection and testimony, TVM had notice of at least two claims in 2006 that involved UV degradation in enclosed buildings. (Id. at 86:16-87:16, 87:25-88:4; ECF No. 91, at 142:1-143:3, 190:11-191:18; Ex. 134, 138).

Mr. Orologio stated that in 2006, he and Mr. Boulding discussed that the product could degrade if it was exposed to- direct or indirect light, whether it was enclosed or exposed to the elements. (ECF -No. 91, Trial Tr., at 21:14-21); Prior to 2007, Mr. Boulding knew that there had not been .any UV testing done on the insulation. (ECF No. 90, Trial Tr., at 77:12-78:7). Covertech met the requirements of many other tests, such as fire code, emissivity codes, reflectivity codes, strength, tensile, puncture, resistance, corrosion, moisture barrier test, and the fungi test, all of which were requested by TVM. TVM never requested testing for UV. (ECF No. 91, Trial Tr., at 123:17-124:10; Ex. JJJJ).

Consistent with TVM’s notice of claims of UV degradation in enclosed buildings with windows and skylights in 2006, in January 2007, Balkar Jagpal at TVM sent one of its distributors, Mueller, a letter stating that rFOIL reflective insulation “that was installed in areas exposed to UV light” that resulted in “delamination and flaking of the white surface— [TVM] recommend[s] against the use of our products in any such environment.” (ECF No.. 90, Trial Tr.; at 90:1-24; Ex. 135). Later in December, 2007, TVM had a managers’ meeting and they decided to put UV inhibitor in all products going forward. (ECF No. 89, Trial Tr., at 181:1-183:10).

TVM requested the price of adding UV inhibitor by email, and Mr. Orologio provided that information by telephone. (ECF No. 91, Trial Tr., at 23:21-25:4). According to Mr. Boulding, UV inhibitor was then added to the product, but the price of the product did not increase. (ECF No. 89, Trial Tr., at 185:19-25; ECF No. 90, Trial Tr., at 190:3-191:6). Cover-tech started to add UV inhibitor to its product in late 2006 or 2007. Mr. Orologio stated that he added the inhibitor, but did not tell the industry until 2008 because he did not have the weathering test results from Ampacet. He did not have the results and he did not want to make claims that he could not back up. (ECF No. 91, Trial Tr., at 148:23-150:7, 151:16-152:11, 155:8-156:7, 158:24-159:25, 165:25-166:15, 169:10-23; Ex. AAA (Ampacet weathering test); Ex. GGG-1 (2006 test from Ampacet)). There have been no degradation claims of product containing the UV inhibitor. (ECF No. 89, Trial Tr., at 186:1-15)).

At the trial in the matter, Mr. Orologio explained that he had known that UV inhibitors being used in solar blankets (pool covers) for decades and that it in certain areas, they are required or the blanket will degrade. He testified that if a solar blanket were used in Arizona, it would require a UV package, but if it were used in Toronto, Canada, where there is less direct sunlight, the UV package would not mean that. much. Mr. Orologio said that this was common knowledge in the pool cover business, a line of products Covertech also sehs. (ECF No. 91, Trial Tr., at 5:24-6:3).

In explaining his statement during the Mueller .deposition, Mr. , Orologio testified at the trial in this case that, being in the swimming pool business, he knew that if polyethylene was exposed to sunlight, it would deteriorate. Prior to 20.04, he believed the product probably would not deteriorate in applications where it was applied to the ceiling with minimal exposure to sunlight. (ECF No. 91, Trial Tr., at 97:14-98:24). Mr. Orologio stated that he knew that the product was being used in metal buildings, but the metal buildings that he saw every day, so-called Quoris'et buildings, had no windows, no skylights and only a door at the end. He did not know, in April of 2006, that Mueller’s buildings contained skylights and windows. (Id. at 109:22-110:16,115:21-116-10).

According to Mr. Boulding, “we anticipate that we lost about $12 and a half million in sales due to‘the defective product.” Tr., Boulding, 10/22 at 206:24-25. According to Mr. Boulding, for that $12 and half million in sales, TVM’s profit margin is approximately 30 percent, so about $4 million, a little over $4 million.” (ECF No. 89, Trial Tr., at 207:1-5). Mr; Boulding agreed that he' had testified that his margin was 15 to 30 percent and that he just picked the highest number. He said he “did not go through every sale.” (ECF No. 90, Trial Tr., at 110:1-12). Mr. Boulding did not discount for the fact that'at this same time, TVM stopped selling rFOIL and started to compete against it. He agreed that for eight years, rFOIL had been “the world’s leading reflective insulation.” He also said that it was the “leading reflective insulation brand worldwide.” (Id. at 110:21-111:23). Mr. Boulding did not account for other situations that were unrelated to Covertech, such as customers complaining about Kelly Myers. (Id. at 115:22-116:8). Mr. Boulding did not provide written support for his calculations.

In the Mueller case, TVM and Cover-tech entered into a settlement agreement on July 25, 2013. (Ex. 52). As stated in the recitals to the settlement agreement, “the Parties have agreed to fully and finally compromise, settle and resolve all claims, potential claims, causes of action and potential causes of action asserted by them in the above entitled and numbered cause....” (Ex. 52).

The settlement agreement, includes a release, which states that:

TVM [and its affiliates], hereby forever release, acquit, and discharge Covertech and [its affiliates] of and from any and all claims and actions or causes of action asserted in the above-entitled-and numbered cause, together with any and all claims and causes of action, including but not limited to claims for indemnity, contribution, breach of express and implied warranties, breach of contract, negligence, any tort claims, negligence based claims, fraud andlor .misrepresentation based claims, all claims arising out of any past, present or. future breach of express and/or implied warranty, statutory and/or common law indemnity claims, claims for any and all actual and/or. exemplary and/or punitive damages, claims for equitable relief arising out of the sale, delivery, repair, replacement of any insulation products and/or services sold to or provided to Mueller, Inc.”

(Ex. 52, § 3.1 (emphasis added); ECF No. 90, Trial Tr., at 119:10-121:13). According to Mr. Boulding, he is not seeking damages for anything arising from the- products in the Mueller case. He said that Mueller accounted for approximately 20 percent of the amount of TVM’s sales in that period of time. (Id. at 156:25-157:16).

y. CONCLUSIONS OF LAW

Covertech has brought claims against TVM under the Lanham Act, 15 U.S.C. §§ 1114 and 1125(a), including trademark infringement claims relating to its registered rFOIL and CONCRETE BARRIER trademarks, as well as. unfair competition claims relating to its unregistered CONCRETE UNDERPAD/ULTRA CONCRETE UNDERPAD and ULTRA NT RADIANT BARRIER marks. (ECF No. 1 at 20-23). Covertech has also brought a claim that TVM committed fraud on the USPTO by registering the ULTRA NT RADIANT BARRIER mark. (Id. at 24-25). Covertech further asserts claims for common law unfair competition, two distinct claims for breaches of contract, and a claim for unjust enrichment. (Id. at 23-30). The Court notes that the parties have stipulated to the voluntary dismissal of Covertech’s claims for federal trademark dilution and fraudulent misrepresentation. (ECF No. 93).

a. . Federal Trademark Infringement— rFOIL

A person shall be liable in a civil action by the registrant of a trademark if he, without the consent of the registrant, does the following:

(a) use[s] in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive; or

(b) reproduce^], counterfeits], cop[ies], or colorably imitate[s] a registered mark and apply such reproduction, counterfeit, copy, or colorable imitation to labels, signs, prints, packages, wrappers, receptacles or advertisements intended to be used in commerce upon or in connection with the sale, offering for sale, distribution, or advertising of goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive____

15 U.S.C. § 1114(1).

To prove a violation of the Lanham Act through trademark infringement, 15 U.S.C. § 1114, and federal unfair competition, 15 U.S.C. § 1125(a)(1)(A), “a plaintiff must demonstrate that (1) it has a valid and legally protectable mark; (2) it owns the mark; and (3) the defendant’s use of the mark to identify goods or services causes a likelihood of confusion.” A & H Sportswear, Inc. v. Victoria’s Secret Stores, Inc., 237 F.3d 198, 210 (3d Cir. 2000) (citing Commerce Nat’l Ins. Servs., Inc. v. Commerce Ins. Agency, Inc., 214 F.3d 432, 437 (3d Cir.2000)). The plaintiff bears the burden of proof. Id. at 211 (citing American Home Prods. Corp. v. Barr Labs., Inc., 834 F.2d 368, 371 (3d Cir.1987)).

The Court found above that the United States Patent and Trademark Office (“USPTO”) added the trademark rFOIL to its principal register pursuant to an application filed by Covertech on September 18, 1997. If the mark at issue is federally registered and has become incontestable, then validity, legal protectability, and ownership are proved. See Commerce Nat. Ins. Servs., Inc., 214 F.3d at 438 (citing Ford Motor Co. v. Summit Motor Prods., 930 F.2d 277, 292 (3d Cir.1991)). The parties stipulated prior to trial that rFOIL was incontestable pursuant to 15 U.S.C. § 1065. (EOF No. 79 at 1). Thus, Covertech has succeeded in proving ownership, legal protectability and validity of rFOIL. See Ford Motor Co., 930 F.2d at 292.

i. Likelihood of Confusion

Next, the Court must determine whether or not Covertech has demonstrated likelihood of confusion. Likelihood of confusion exists where the consumers viewing the defendant’s mark would probably assume that the product or service it represents associated with the source of a different product or service is identified by a similar mark. Ford Motor Co., 930 F.2d at 292 (quoting Scott Paper Co. v. Scott’s Liquid Gold, Inc., 589 F.2d 1225, 1229 (3d Cir.1978)). The Third Circuit has identified a number of factors that govern the likelihood of confusion analysis, namely:

(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 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 the public because of the similarity of function; (10) other facts suggesting that the consuming public might expect the prior owner to expand into the defendant’s market.

Id. at 293 (citing Scott Paper Co., 589 F.2d at 1229). The plaintiff must show likely confusion by a preponderance. of the evidence. KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111, 120, 125 S.Ct. 542, 160 L.Ed.2d 440 (2004). The ten factors of the analysis will each be considered individually below.

1. Factor One: Degree of Similarity

Perhaps the most important of the factors on the above ten-factor list is the degree of similarity between the two marks. Ford Motor Co., 930 F.2d at 293. The Third Circuit has held that “if the overall impression created by marks is essentially the same, ‘it is very probable that the marks are confusingly similar.’” Id. (citing Opticians Ass’n of America v. Independent Opticians of America, 920 F.2d 187, 195 (3d Cir.1990)). The likelihood of confusion should be determined by viewing the two marks fr