Fabick, Inc. v. Fabco Equip., Inc. (296 F. Supp. 3d 1022, 2017)

WILLIAM M. CONLEY, District Judge

This case illustrates some of the perils of going into business with family members, including the obvious risks of intermingling business and personal relationships, but also the less obvious risks associated with using a family name as a trademark. Here, plaintiff Fabick, Inc., asserts claims of trademark infringement under both federal and state common law against defendant FABCO Equipment, Inc., and JFTCO, Inc., based on defendants' use of the "Fabick CAT" name beginning in July 2015. The parties' cross motions for summary judgment are before the court. (Dkt. ## 90, 117.) For the reasons that follow, the court will deny both motions, with one exception: defendant FABCO's motion for judgment in its favor on any claim of direct trademark infringement.

PRELIMINARY ISSUES

I. Motion to Strike Defendants' Affirmative Defenses (dkt. # 195)

In a prior order, the court granted defendants' motion to dismiss count I of plaintiff's first amended complaint and directed plaintiff to file a second amended complaint (dkt. # 88), which it did (dkt. # 143). In response, defendants filed their respective answers. (Dkt. ## 144, 145.) Plaintiff now moves to strike two defenses which it contends were raised for the first time in the amended answers without leave of court: (1) a fair use defense under 15 U.S.C. § 1115(b)(4), and (2) a fraudulent procurement defense under 15 U.S.C. § 1115(b)(1).

In opposing the motion, defendants contend generally that the motion should be denied solely "because a plaintiff's new complaint wipes away prior pleadings, [and, therefore,] the amended complaint opens the door for defendants to raise new and previously unmentioned affirmative defenses." (Defs.' Opp'n (dkt. # 207) 1-2 (quoting Chasensky v. Walker , 740 F.3d 1088, 1094 (7th Cir. 2014) ).) More precisely, however, Chasensky and other cases like it stand for the proposition that in answering the amended complaint, a party may respond to new allegations with new affirmative defenses. Similarly, if the amended complaint does not contain new allegations giving rise to new defenses, then the defendant must seek leave to amend its answer to add those new defenses. See generally 6 Charles Alan Wright, et al. , Fed. Prac. & Proc. Civ. § 1476 (3d ed.) ("[W]hen the complaint is amended defendant should be entitled to amend the answer to meet the contents of the new complaint.").

With respect to the § 1115(b)(4), plaintiff asserts factual allegations for the first time in its second amended complaint that relate to fair use. (Compare 2d Am. Compl. (dkt. # 143) ¶ 54 ("FABCO asserts that prior to selling its assets to JFTCO, and in spite of FABCO having previously sold the Fabick stock and the FABICK Marks to Jay Fabick, that FABCO had a common law 'fair use' right to use the 'Fabick' name in FABCO's business operations."), with 1st Am. Compl. (dkt. # 32) (containing no reference to "fair use").) As such, the court finds that defendants reasonably added a fair use defense in their respective answers to the second amended complaint.

Defendants' new affirmative defense of fraudulent procurement under 15 U.S.C. § 1115(b)(1), however, presents a different situation. With respect to this defense, defendants do not argue that new allegations in plaintiff's second amended complaint open the door to this defense; rather, defendants argue that they "did not have a basis to plead that Plaintiff fraudulently procured its trademark rights at the outset of this case." (Defs.' Opp'n (dkt. # 207) 4.) Instead, defendants maintain they only learned of the availability of this defense during Jay Fabick's deposition in this lawsuit, when he purportedly testified that he was award of the prior use of the Fabick mark by the John Fabick Tractor Company. (Id. ) While perhaps this justified granting leave to amend their respective answers under Rule 15(a)(2), defendants did not seek leave to add this new defense either before or at the time they filed their respective amended answers. Still, the court is reluctant to exalt form over substance, particularly when answering an amended complaint may have seemed a convenient (if somewhat underhanded) opportunity to add this new defense. As such, the court will treat defendants' opposition as a motion for leave to amend their answers to add a defense under 15 U.S.C. § 1115(b)(1).

Typically, leave to amend should be "freely" given. Fed. R. Civ. P. 15(a)(2). Notwithstanding this "liberal attitude towards the amendment of pleadings, courts in their sound discretion may deny a proposed amendment if the moving party has unduly delayed in filing the motion, if the opposing party would suffer undue prejudice, or if the pleading is futile." Soltys v. Costello , 520 F.3d 737, 743 (7th Cir. 2008) (internal quotation omitted). Accepting defendants' contention that they did not know of the availability of this defense until Jay Fabick's deposition, the deposition was held on March 14, 2017, while defendants' respective answers were not filed until June 28, 2017, more than three months later. Admittedly, defendants' answers to the second amended complaint were not due until that date, but defendants offer no reason for not seeking to amend more promptly, a particularly poor choice since even defendants concede the fraudulent procurement defense was not triggered by new allegations in the second amended complaint. In sum, defendants could have (and should have) sought leave to add this new defense shortly after Jay Fabick's deposition.

Still, three months is not an inordinate delay absent some prejudice to plaintiff, and that is where plaintiff's opposition stalls. See Dubicz v. Commonwealth Edison Co. , 377 F.3d 787, 792 (7th Cir. 2004) ("Delay, standing alone, may prove an insufficient ground to warrant denial of leave to amend the complaint; rather, the degree of prejudice to the opposing party is a significant factor in determining whether the lateness of the request ought to bar filing." (internal citation and quotation marks omitted)). As far as the court can discern, defendants' unclean hands defense touches on the same factual allegations as those that would support a fraudulent procurement defense, and other than complaining generally about its need to conduct discovery relative to these defenses, plaintiff has identified no way in which its discovery efforts or trial preparations would be prejudiced by the late addition of this defense. See generally 6 J. Thomas McCarthy, McCarthy on Trademarks & Unfair Competition § 31:60 at 31-160 to 31 -161 (discussing interplay between unclean hands defense based on fraud in obtaining registration and a § 1115(b)(1) defense).

For these reasons, the court will deny plaintiff's motion to strike defendants' fair use and fraudulent procurement defenses under 15 U.S.C. §§ 1115(b)(4) and 1115(b)(1), respectively.

II. Reserved Portion of Motion to Compel (dkt. # 211)

Defendants filed a motion to compel discovery or, alternatively, to preclude evidence and argument at trial on advice of counsel. (Dkt. # 211.) After hearing argument from the parties on that motion, the court previously: (1) granted it in part by striking plaintiff's reliance on an advice of counsel defense in its summary judgment briefing and precluding certain related testimony at trial; (2) denied it in part by refusing to compel production of one of the categories of privileged documents; and (3) reserved on compelling production of the other category of documents to defendant JFTCO pending additional briefing from the parties. (10/5/17 Order (dkt. # 215).) Having now reviewed certain of the withheld documents in camera and considered the parties' additional briefing, the court agrees with defendants that FABCO's right to attorney-client privilege transferred at the time of JFTCO's acquisition of substantially all of FABCO's assets. Accordingly, the court will direct plaintiff to produce the "first category" of documents identified in the court's prior order and filed by plaintiff for in camera review.

As set forth in defendants' supplemental briefing, a corporation's rights and authority with respect to the attorney-client privilege passes to the new management along with control. See Commodity Futures Trading Comm'n v. Weintraub , 471 U.S. 343, 349, 105 S.Ct. 1986, 85 L.Ed.2d 372 (1985) ; see also Am. Int'l Specialty Lines Ins. Co. v. NWI-I, Inc. , 240 F.R.D. 401, 407 (N.D. Ill. 2007) (recognizing that following Weintraub , "several courts have recognized that assignees or transferees of most, if not all, of a corporation's assets will have the authority to assert or waive the attorney-client privilege" (internal citations omitted)). (See also Defs.' Suppl. Br. (dkt. # 217) 2-3 & n.3 (citing other cases in support).)

In response, plaintiff does not cite any legal authority to the contrary, but instead argues that any attorney-client privilege attaching to the documents at issue had transferred from FABCO to plaintiff Fabick, Inc., at the time of the 1997 transfer of Fabick stock to Jay Fabick, and therefore had already been lost before the 2015 asset acquisition by JFTCO. (Pl.'s Opp'n (dkt. # 218) 1.) The argument presumes that the attorney's involved in the creation of these communications from approximately 1993 to 1996 was solely representing Fabick's interest, when in fact the representation was plainly a joint one in which the law firm of Foley & Lardner was acting in the collective interest of two clients-FABCO and Fabick-meaning both had the right to the privilege. As a result, in transferring its ownership interests to Fabick in 1997, FABCO only transferred those interests held by Fabick, including Fabick's attorney-client privilege, but not that owed to FABCO. Indeed, this is the only way to interpret Foley & Lardner's agreeing to do the work of Fabick, Inc., and its far longer-standing, ongoing representation of FABCO, as Fabick's subsidiary entity. This is also the only way to make sense of plaintiff's position that FABCO was intimately involved in the trademark application process by securing representation by Foley & Lardner and paying the fees and expenses incurred as part of that process. Plaintiff simply cannot have it both ways.

Finally, in its supplemental brief, plaintiff reiterates its argument that even if FABCO retained a joint privilege after 1997, it still cannot unilaterally transfer that privilege to a third-party without Fabick's consent. True enough, but there are at least two problems with that argument on the facts here. First, JFTCO is not a typical third-party; rather, it sits in FABCO's shoes in light of its acquisition of substantially all of FABCO's assets. The question then is whether Fabick had a reasonable expectation that FABCO would not be allowed to transfer the joint privilege to a successor entity. For the most part, courts have concluded that the privilege transfers to the successor corporation even when that privilege arises out of a joint representation. See, e.g. , 625 Milwaukee, LLC v. Switch & Data Facilities Co., LLC , No. 06-C-0727, 2008 WL 582564, at *4 (E.D. Wis. Feb. 29, 2008) ; Bass Public Ltd. Co. v. Promus Cos., Inc. , 868 F.Supp. 615, 619-20 (S.D.N.Y 1994) ; Polycast Tech. Corp. v. Uniroyal, Inc. , 125 F.R.D. 47, 49 (S.D.N.Y. 1989). In addition, as defendants point out, and plaintiff fails to respond, the privilege was effectively waived in light of Fabick's suing FABCO under the adverse litigation exception to joint representation privilege. See In re Teleglobe Commc'ns Corp. , 493 F.3d 345, 366 (3d Cir. 2007), as amended (Oct. 12, 2007).

Accordingly, the court will grant defendants' motion to compel in part, and will order plaintiff to produce promptly to defendants the documents identified by the court in its prior order as the "first category."

SUMMARY JUDGMENT OPINION

UNDISPUTED FACTS

A. Overview of the Parties

Plaintiff Fabick, Inc., is a Wisconsin corporation, with its principal place of business in Madison, Wisconsin. Fabick is in the business of developing, selling and applying protective coatings and sealants for various construction, commercial, industrial, mining, agricultural, equipment, containment, maritime, military and automotive uses.

Defendant FABCO Equipment, Inc., was a Wisconsin corporation, with its principal place of business in Milwaukee, Wisconsin. On July 1, 2015, co-defendant JFTCO, Inc., purchased substantially all of the assets of FABCO. Also on that date, FABCO changed its name to FEI Legacy, Inc., and that entity was dissolved on June 29, 2016. Before July 1, 2015, FABCO operated as the exclusive Caterpillar dealer for Wisconsin and certain counties comprising the Upper Peninsula ("UP" of Michigan). In that capacity, FABCO was engaged in the business of selling, renting, servicing and repairing Caterpillar branded heavy equipment for use in a variety of industries including construction, agriculture, demolition and mining.

JFTCO, Inc., was organized as a Delaware corporation on March 13, 2015, and it is registered as a foreign corporation in the state of Wisconsin, effective June 5, 2015. JFTCO is a wholly-owned subsidiary of the John Fabick Tractor Company, which is a Caterpillar dealership headquartered in Fenton, Missouri. On July 1, 2015, JFTCO began operating in Wisconsin and Northern Michigan as the exclusive Caterpillar dealership under the name "Fabick CAT." JFTCO's primary business is the same as that previously engaged in by FABCO. Indeed, its assigned Caterpillar dealership territory is identical. Until July 1, 2015, the John Fabick Tractor Company was the Caterpillar dealer for an area encompassing parts of Missouri and Illinois, one county in Oklahoma and one county in Kansas.

B. History of FABCO

The history of FABCO begins with a falling out between siblings in the previous generation of Fabicks, particularly John Fabick's sons Joseph Fabick, Sr. ("Joe") and his brothers. In 1982, the John Fabick Tractor Company acquired two pre-existing Caterpillar dealerships serving Wisconsin and the Upper Peninsula of Michigan with the intent that Joe could ultimately own a separate newly-formed Caterpillar dealership. Prior to acquiring these dealerships, Joe had worked with his brothers for the John Fabick Tractor Company, which ran a highly successful Caterpillar dealership serving its designated territory. So, in 1982, Joe moved to Wisconsin, founded FABCO, and served as President and CEO of FABCO from 1982 until 2001 over its own highly successful dealership. Joe then turned over FABCO to his son Jeré Fabick ("Jeré") and assumed the title of Chairman of FABCO, until his retirement in 2002.

FABCO continued to operate the Caterpillar dealership at multiple retail locations in Wisconsin and the UP of Michigan until it was sold on June 30, 2015. Within its territory, FABCO had three different types of location: (1) FABCO Equipment, primarily dealing with Caterpillar equipment and machines; (2) FABCO Power Systems, primarily dealing with Caterpillar engines and generators; and (3) FABCO Rents, which provided contractors with daily, weekly, monthly or longer-term rentals of equipment, usually the "smaller end of the Caterpillar line of equipment." FABCO Equipment and FABCO Power Systems may have been combined in one location, but FABCO Rents locations were independent, standalone facilities. FABCO sold new and used Caterpillar equipment, including Caterpillar trucks (at least for a few years) and attachments for Caterpillar equipment, such as snow wings. FABCO also serviced equipment, sold parts for Caterpillar machines and installed those parts as a function of its service component. FABCO customers' industries covered farming, mining, manufacturing, government entities and municipalities, construction and contractors.

Many of Joe's eight children were employed by FABCO at some point in time. Joseph Fabick, Jr. ("Jay") worked at FABCO from 1982 until December 31, 1997. Jay's brother Jeré worked for FABCO from 1982 until its sale to JFTCO on June 30, 2015. Jeré became the regional manager of FABCO's Madison and La Crosse branches in 1992 and held that position for about three years. From 1995 until 2001, Jeré was the Executive Vice President of FABCO. In 2001, he became its President and CEO. Beginning in June 2002, Jeré and his father Joe became the sole shareholders of FABCO; before that time, the shareholders included Joe, his eight children (including Jay and Jeré) and seventeen grandchildren.

In 2004, Jeré became the sole shareholder of FABCO. Jeré remained the President, CEO and sole shareholder of FABCO until FABCO ceased its operations and sold its assets to JFTCO. Currently, Jeré is the President of the John Fabick Tractor Company and its wholly owned subsidiaries, including JFTCO. He is also the Co-Dealer Principal of both the John Fabick Tractor Company and JFTCO. Doug Fabick is the current CEO and the other Co-Dealer Principal of the John Fabick Tractor Company.

For over a decade, FABCO primarily used the following mark in commerce:

(Defs.' Add'l PFOFs (dkt. # 153) ¶ 103 (citing Jeré Fabick Decl. (dkt. # 123) ¶ 18).)

C. History of Fabick, Inc.

Around the time that Jeré became the heir apparent of FABCO, Fabick was formed and began operating as a division of FABCO, originally identified as FABCO Surface Protection for about a year before it was incorporated in December 1993. Fabick's business focused primarily on spray-on bedliners for pickup trucks and similar vehicles, though its products provide protection and coating in a variety of applications for an assortment of products, including products owned and operated by defendants' customers. At the time it was incorporated, FABCO owned 100% of Fabick's stock, and Joe was the majority shareholder of FABCO. At some point, Joe acquired 25% of the Fabick stock.

Jay was instrumental in the startup and operation of Fabick, and he was centrally involved in the business from its inception, including taking a leave of absence from his FABCO duties in 1995 to concentrate his efforts on building Fabick. During this time, Jay remained employed by FABCO as the Vice President of Product Support. Plaintiff also contends that Joe was also involved in Fabick's startup, and according to Jay, Joe was "probably the biggest supporter and promoter of Fabick, Inc." (Pl.'s Reply to PFOFs (dkt. # 175) ¶ 56.)

Tom Svetnicka, currently the Vice President of Marketing for JFTCO, held positions in marketing and advertising with FABCO dating back to 1987. Svetnicka was also involved in Fabick's startup, though the parties dispute the extent of his involvement. At a minimum, Svetnicka attended at least one business meeting with a business consultant regarding Fabick's startup, created a list of potential names for Fabick, though "Fabick" was not on that list, was involved in creating and designing the original logo for Fabick, including the color scheme, and assisted in creating an advertisement for Fabick.

While owned by FABCO, Fabick had access to and used FABCO's customer lists, marketing personnel and product service representatives ("PSRs") to build its business. Fabick created a sales manual and a sales kit for use by PSRs, which described Fabick's products and services. Joe also sent a letter to PSRs, describing Fabick's business. Fabick similarly participated in FABCO customer meetings and seminars and FABCO trade shows, with Fabick displaying its own products and brochures. Fabick further sent direct mail pieces to FABCO's customer list, which promoted its products and services. Finally, Fabick advertised in the same media as FABCO, including Western Builder publication and Terra Construction and Engineering Corporation's publication.

On December 30, 1997, Jay's employment was formally terminated by FABCO. FABCO negotiated with Jay and ultimately offered him a severance package that included taking over Fabick, Inc., as its sole owner. On December 31, 1997, FABCO and Joe transferred 100% of the corporation's stock in Fabick to Jay. Since acquiring the stock, Jay has been the President and sole shareholder of Fabick. After Fabick and Jay separated from FABCO, Fabick and FABCO operated entirely independently without incident for a number of years.

D. Fabick's Trademarks, Service Marks and Domain Names

On March 25, 1994, while still a wholly-owned subsidiary of FABCO, Fabick filed a trademark application with the United States Patent and Trademark Office for the mark "FABICK" for a "polyurethane-based and polyureabased sealers and protectants to be applied as a coating to hard or flexible surfaces." On April 11, 1994, Fabick also filed a service mark application with the USPTO for the mark "FABICK." On August 22, 1995, Fabick's service mark application was granted, with a date of first use of October 5, 1995, identified. On December 4, 1995, Fabick registered the domain name www.fabick.com. Finally, on January 14, 1997, while FABCO still owned 75% of Fabick's stock, its trademark application was granted. (See Dettmann Decl., Exs. TT, UU (dkt. ## 113-10, 113-11).)

In his capacity as President and based on 20 years' experience with Fabick, as well as with the coatings and sealants industry, Jay represents that the FABICK marks have become well known in the coatings and sealants industry. (Pl.'s PFOFs (dkt. # 93) ¶ 85 (citing Jay Fabick Decl. (dkt. # 105) ¶ 28).) Fabick's basic logo, depicted below, has remained unchanged since Fabick filed its trademark and service mark applications (including this logo in both):

(Pls.' Reply to PFOFs (dkt. # 175) ¶ 85.a (citing Dettmann Decl., Exs. RR, SS (dkt. ## 113-8, 113-9).) Defendants direct the court to two other logos to argue that Fabick has used a number of different logos, though these two share the same basic attributes as the one above:

(Defs.' Resp. to Pl.'s PFOFs (dkt. # 150) ¶ 85.a (citing Schroeder Decl., Ex. P (dkt. # 125-16); Schroeder Decl., Ex. WW (dkt. # 165-2).)

DISCUSSION

Plaintiff asserts claims against both JFTCO and FABCO for trademark infringement and false advertising under the Lanham Act, 15 U.S.C. § 1114(1) and § 1125 (claims 1 and 2) and for trademark infringement under state common law (claim 3). (2d Am. Compl. (dkt. # 143).) The parties' cross motions for summary judgment raise a variety of arguments, including several that apply to all three claims, which the court attempts to address in an orderly fashion in this opinion.

I. FABCO's Liability

As an initial matter, defendants seek summary judgment as to all claims asserted against defendant FABCO because it did not use the name FABICK in commerce. To demonstrate direct infringement, plaintiff's federal statutory claims and the state common law claim require "use in commerce" to be liable. See 15 U.S.C. § 1114(1) (requiring proof of defendant's "use in commerce and 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 or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive ..." (emphasis added)); 15 U.S.C. § 1125(a)(1)(A) (providing a claim for false advertising against "any person who ... uses in commerce ... any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which-(A) is likely to cause confusion ..." (emphasis added)); Echo Travel, Inc. v. Travel Assocs., Inc. , 870 F.2d 1264, 1266 (7th Cir. 1989) (explaining that Wisconsin common law claim for trademark infringement requires the same core elements as under federal law).

To understand this basis for summary judgment, the parties provide additional details about the acquisition of FABCO, creation of JFTCO and use of the Fabick CAT name. In 2014, Jeré began considering a succession plan for FABCO. Specifically, in an effort to keep FABCO in the Fabick family, Jeré considered approaching his cousin, Doug Fabick, the CEO of the John Fabick Tractor Company, which originally formed FABCO in 1982, about a possible acquisition or merger. Before approaching the John Fabick Tractor Company regarding a possible merger or acquisition, however, Jeré first approached Caterpillar to get its approval. During the fall of 2014, FABCO and the John Fabick Tractor Company then engaged in discussions with Caterpillar to obtain final approval of the proposed acquisition.

A December 9, 2014, letter from Jeré and Doug to Caterpillar, states that "[t]he intent is to begin changing the 'FABCO' brand to 'FABCO-a Fabick family company' immediately and eventually moving to the Fabick brand." (Pl.'s PFOFs (dkt. # 93) ¶ 152 (citing Dettmann, Decl., Ex. K (dkt. # 109-7)).) Jeré testified at his deposition that this brand name change was "intended to provide a smooth transition. You know, they know the Fabick family name, but probably to get the Fabick family name out a little bit more prominently in advance of-as part of the transition process." (Defs.' Resp. to Pl.'s PFOFs (dkt. # 150) ¶ 153 (quoting Jeré Fabick Dep. (dkt. # 126) 108).)

By December of 2014, the decision was made to rebrand FABCO as "Fabick CAT." JFTCO was then formed in 2015 in anticipation of the purchase of FABCO's assets for the purposes of operating the Caterpillar dealerships located in Wisconsin and Northern Michigan. Caterpillar approved the merger on January 27, 2015.

In February, the merger, including the planned rebranding to Fabick CAT, was communicated to employees, customers and partners of both companies. The latter announcement stated that: FABCO and the John Fabick Tractor Company "have reached an agreement to join FABCO and Fabick CAT into one Caterpillar dealership"; "[o]ver the next several months, FABCO/Fabick teams will be working together to complete this transformation with an expected closing date of June 30, 2015"; the "the FABCO identity will transition over time to the Fabick Cat identity; [and] this change is expected to take place over the next 36 months." (Pl.'s PFOFs (dkt. # 93) ¶ 163 (quoting Dettmann Decl., Ex. O (dkt. # 109-11).)

A February 2015 press release also used the "Fabick CAT" name and logo. (Id. at ¶ 166 (citing Dettmann Decl., Ex. M (dkt. # 109-9).) FABCO issued similar notices and advertisements between February and June 30, 2015, which referenced bringing "Fabick family dealerships back together" and used the phrase "A Fabick Family Company." (Id. at ¶¶ 167-75.) Defendants do not dispute any of this, although they point out that any reference to "Fabick" by FABCO was only "in a limited number of advertisements that were placed over a very brief period of time." (See, e.g. , Defs.' Resp. to Pl.'s PFOFs (dkt. # 175) ¶ 173.) Plaintiff also points out that Tom Svetnicka, the current Vice President of Marketing for JFTCO who held prior positions in marketing and advertising with FABCO dating back to 1987, created various iterations of the Fabick CAT logo.

While defendants originally intended to phase out FABCO and transition to Fabick CAT over a 36-month period, the John Fabick Tractor Company and JFTCO decided to accelerate the rebranding. Accordingly, as of July 1, 2015, the date JFTCO

began operating the Wisconsin and Northern Michigan Caterpillar dealership, FABCO logos were replaced with Fabick logos. JFTCO spent over $250,000 on new signage in 2015, and approximately $45,000 more in 2016. FABCO's websites are no longer operational. On certain signs in Madison, Wisconsin and Marquette, Michigan, the FABCO signs were replaced with signs containing only the word "Fabick," without any reference to "CAT," although after plaintiff's filing of this complaint, which referenced the "Fabick" sign on the Madison building facing the Beltline, JFTCO removed these signs.

On this record, defendants maintain that neither FABCO nor FEI Legacy used the Fabick CAT mark in commerce. Instead, the first use of the Fabick CAT mark in commerce occurred after the APA was consummated on July 1, 2015, and thus after FABCO ceased all operations. Defendants argue, therefore, that FABCO's responsibility is limited to using the Fabick name in announcements of the merger, which courts have generally found forms an insufficient basis to qualify as "use in commerce." See Sensient Techs. Corp. v. SensoryEffects Flavor Co. , 613 F.3d 754, 762-63 (8th Cir. 2010) (affirming grant of summary judgment to defendant, finding "two customer presentations, a press release, an announcement, and a website" without any sale or transport of goods containing the mark insufficient to demonstrate "use in commerce"); Aycock Eng'g, Inc. v. Airflite, Inc. , 560 F.3d 1350, 1359-60 (Fed. Cir. 2009) ("[M]ere preparations to use that mark sometime in the future will not do.").

In response, plaintiff argues that FABCO is liable for contributory infringement because "FABCO was directly involved in the joint decision to begin using the infringing Fabick CAT tradename," including issuing a press release, accelerating the transition to that name, and using one of its employees to create the Fabick CAT logo. (Pl.'s Opp'n (dkt. # 147) 4.) To establish contributory infringement, however, a plaintiff must show intent on the part of the defendant and knowledge of the wrongful activities of the direct infringer. See David Berg & Co. v. Gatto Int'l Trading Co. , 884 F.2d 306, 311 (7th Cir. 1989). Contributory infringement typically occurs in the context of a manufacturer-distributor relationship:

A manufacturer can be held liable for contributory trademark infringement even if it does not itself mislabel the goods or deceive any customers. If a distributor "[i]ntentionally induces another to infringe a trademark, or if it continues to supply its product to one whom it knows or has reason to know is engaging in trademark infringement the ... distributor is contributorily responsible...."

Id. (quoting Inwood Laboratories v. Ives Laboratories , 456 U.S. 844, 853-54, 102 S.Ct. 2182, 72 L.Ed.2d 606 (1982) ). Still, as plaintiff points out, the Seventh Circuit in Hard Rock Café Licensing Corp. v. Concession Services, Inc. , 955 F.2d 1143 (7th Cir. 1992), "treated trademark infringement as a species of tort" and "have turned to common law to guide our inquiry into the appropriate boundaries of liability," including expanding the doctrine to cover landlords and licensees, for example. Id. at 1148-49.

Here, plaintiff contends that FABCO knew of its FABICK trademarks and, at a minimum, facilitated JFTCO's adoption of a trademark that infringes plaintiff's. Notwithstanding defendants' denials, moreover, there are factual disputes as to the extent of FABCO's knowledge, as described in the section of the opinion below dealing with defendant's unclean hands defense. (See infra Opinion § IV.) In particular, there appears to be no dispute that FABCO was involved in arranging and paying for Fabick's legal representation in 1994 and 1995 to pursue the trademark applications, nor that Tom Svetnicka (a FABCO employee at the time and a current JFTCO employee) was involved in designing the Fabick mark. As such, plaintiff has raised a genuine issue of material fact as to whether FABCO had actual knowledge of the Fabick trademarks.

Alternatively, defendants argue that the decision to use the Fabick name was made by the John Fabick Tractor Company, consistent with its own, long-standing use of the Fabick name, and not by FABCO. But here, too, the record permits a contrary inference, including FABCO's involvement in the discussions with the John Fabick Tractor Company and Caterpillar on post-acquisition, re-branding plans. Moreover, Svetnicka contributed to the design of the Fabick CAT lock up, even if the contribution were limited to italicizing the Fabick name to resemble the FABCO mark.

On this record, therefore, a reasonable jury could find that FABCO was involved in the decision to adopt the Fabick name, sufficient to hold it liable under a contributory infringement theory, although not that FABCO used the mark in commerce itself. As such, the court will grant judgment to FABCO on any direct infringement claim, but will deny it as to a claim for contributory infringement.

II. Prior Use of "Fabick" Name

Defendants separately seek summary judgment on plaintiff's claims on the basis that the John Fabick Tractor Company's extensive use of the Fabick name precludes plaintiff's claims. "The party who first appropriates a mark through use, and for whom the mark serves as a designation of source, acquires superior right to it." Johnny Blastoff v. Los Angeles Rams Football Co. , 188 F.3d 427, 434 (7th Cir. 1999). This is true even where a party, like plaintiff, later registers the mark. See 15 U.S.C. § 1065 (creating an exception to right of trademark owner where "the use of a mark registered on the principal register infringes a valid right acquired under the law of any State or Territory by use of a mark or trade name continuing from a date prior to the date of registration"); see also Eco Mfg. LLC v. Honeywell Int'l, Inc. , 357 F.3d 649, 651 (7th Cir. 2003) (" Section 1065 says that even 'incontestable' marks must yield to prior users.").

Indeed, the Lanham specifically provides for an affirmative defense based on prior use. In particular, 15 U.S.C. § 1115(b) sets forth certain defenses to incontestability, including:

(5) That the mark whose use by a party is charged as an infringement was adopted without knowledge of the registrant's prior use and has been continuously used by such party or those in privity with him from a date prior to (A) the date of constructive use of the mark established pursuant to section 1057(c) of this title, (B) the registration of the mark under this chapter if the application for registration is filed before the effective date of the Trademark Law Revision Act of 1988, or (C) publication of the registered mark under subsection (c) of section 1062 of this title: Provided, however, that this defense or defect shall apply only for the area in which such continuous prior use is proved;

In support of this basis for summary judgment, defendants describe the John Fabick Tractor Company's use of the "Fabick" mark generally, and specifically its use in Wisconsin and Northern Michigan. By way of further context, it is undisputed that John Fabick, Sr., the grandfather and patriarch of all the Fabicks warring in this litigation, began selling tractors in St. Louis, Missouri, in 1917. A decade later, the John Fabick Tractor Company was incorporated by John Fabick, Sr., and it was awarded an exclusive territory to sell Caterpillar tractors in St. Louis, Missouri, in 1927. Since its founding, that company has been led by Fabicks, first by John Fabick, Sr., then his sons John Fabick II and Francis Fabick, grandsons Harry Fabick and Jeré Fabick, and then great grandson Doug Fabick (Harry's son). Joe, the founder of FABCO and Jay and Jeré's father, was the youngest son of John Fabick, Sr. As previously explained, Joe was also an executive for the John Fabick Tractor Company before acquiring his own Caterpillar dealership and forming FABCO, and would have been well aware of the extensive use of "Fabick" by that company as well at the time he was pursuing the trademark for FABCO and Fabick.

The John Fabick Tractor Company and its subsidiaries, including JFTCO, are engaged in the selling and servicing of Caterpillar branded heavy equipment. Defendants contend that "[c]ollectively, the John Fabick Tractor Company and its subsidiaries have historically been referred to as 'the Fabick Companies.' " (Defs.' Add'l PFOFs (dkt. # 153) ¶ 16.) Part of the support for this finding includes Jay Fabick's application for employment in 1976, titled "The Fabick Company Application for Employment," along with various brochures and other product materials, dating back to the 1940s, using the "Fabick" surname as a mark, like the following:

(Defs.' Add'l PFOFs (dkt. # 153) ¶¶ 17-18, 21-22.) In connection with the John Fabick Tractor Company's 75th anniversary in 1992, the Missouri History Museum created an archive collection on the company, which included promotional materials and other publications using the "Fabick" name. (Defs.' PFOFs (dkt. # 120) ¶¶ 54-58.)

The John Fabick Tractor Company and its subsidiaries also offers evidence of its prior use of websites that incorporated the Fabick family name as part of the domain name, specifically www.johnfabick.com, registered on May 7, 1996, and www.fabickcat.com, registered on February 17, 2004.

In accordance with Caterpillar Inc.'s dealer guidelines, both the John Fabick Tractor Company and its wholly owned subsidiaries have presented themselves to the public under the FABICK CAT name since at least 2002. FABCO identified itself as FABCO CAT, and, after the acquisition of FABCO's assets, the John Fabick Tractor Company modified its dealer logo to incorporate aspects of the previous FABCO look (namely the italicized font), all three of which are shown below:

(Defs.' Add'l PFOFs (dkt. # 153) ¶ 181 (citing Svetnicka Decl. (dkt. # 168) ¶ 20).) Caterpillar regulates the color and dimensions, with the only variable being the words in the yellow box.

Defendants also contend that the prior use of the "Fabick" name in the sale or rental of pipeline equipment and related services provides a basis for finding defendants' use superior to that of plaintiff. Historically, the John Fabick Tractor Company was one of several Caterpillar dealerships with expertise in supplying heavy equipment and machinery to the pipeline industry. Caterpillar did not impose territorial restrictions in the United States on such sales, rentals and related services. By the early 1990s, the John Fabick Tractor Company had developed a substantial customer base for its pipeline business, as evidenced by a May 1994 directory of contacts, listing over 30 contractor customers in Wisconsin and Michigan. (Defs.' Add'l PFOFs (dkt. # 153) ¶ 39 (citing Grothe Decl. (dkt. # 132) ¶ 10; id. , Ex. A (dkt. # 132-1)).) Gerry Grothe, one of the pipeline sales representatives through the late 1980s, 1990s and early 2000s, avers that he personally promoted John Fabick Tractor company products and services to the pipeline industry using the Fabick name and associated logos, including on invoices, rental agreements, purchase orders and brochures, and he routinely called on contractors located in Wisconsin and Michigan. (Id. at ¶¶ 42-51.) Furthermore, sales data from the 1970s to 2002 show pipeline related sales in Wisconsin reaching in excess of half a million dollars in some years.

Defendants further point to John Fabick Tractor Company's extensive history selling used equipment, which similarly involves no territorial restrictions. Here, too, defendants point to evidence that the Fabick name was used to promote used Caterpillar equipment in Wisconsin and Michigan. By at least the 1970s and continuing to the present time, the John Fabick Tractor Company was advertising its used equipment inventory throughout the Midwest, including in Wisconsin and Michigan. Specifically, the John Fabick Tractor Company has routinely advertised its used equipment in the Construction Equipment Guide since at least the 1990s. (See, e.g. , Defs.' Add'l PFOFs (dkt. # 153) ¶ 66 (citing Borlinghaus Decl., Ex. B (dkt. # 134-2) 3); see also id. at ¶ 67.) The Midwest Edition of the Construction Equipment Guide claims to have a circulation of 24,805 and a distribution territory including Wisconsin and Michigan.

Based on this evidence, defendants contend that the "John Fabick Tractor Company's use of the FABICK name nationally, including in Wisconsin and Michigan, has been continuous from before Plaintiff was formed in 1993 through the present day." (Defs.' PFOFs (dkt. # 120) ¶ 96.) In response to this fairly compelling evidence, plaintiff offers two core arguments: (1) JFTCO cannot rely on the John Fabick Tractor Company's prior use; and (2) even if JFTCO could rely on such use, it would have to demonstrate that the previously-used mark of the JOHN FABICK TRACTOR COMPANY is the legal equivalent of the current FABICK CAT mark.

As to the first argument, plaintiff contends that "[w]hile use of a mark by a subsidiary may inure to the benefit of the parent entity, the converse is not true." (Pl.'s Opp'n (dkt. # 147) 10.) In support, plaintiff principally relies on an opinion by the Trademark Trial and Appeal Board, Noble House Home Furnishings, LLC , 2016 WL 3357265, 118 U.S.P.Q.2d 1413 (T.T.A.B. Apr. 4, 2016). In Noble House , the TTAB considered "whether use of the mark by Respondent's parent corporation inures to the benefit of Respondent" ( id. at *1 ), but the court's inquiry was in the context of a motion to cancel the trademark based on abandonment under 15 U.S.C. § 1127. After a trial, TTAB determined that the subsidiary company, who was the registrant of the mark, was not using the mark in any way; instead, the parent corporation was the sole user. Id. at *6-9. As such, the opinion turned on whether the parent company qualified as a "related company" under 15 U.S.C. § 1055. Id. at *10. Because there was no license agreement between the parent and subsidiary or other indication of control by the subsidiary holding the registration, TTAB concluded that the parent company's use did not inure to the benefit of the registrant, and, therefore, the registrant had abandoned the mark. Id. at *11.

The facts, and more critically, the legal theory, at issue in Noble House simply does not fit the assertion of prior use at issue here. Noble House concerns the obligations of trademark registrants to use their marks in commerce. Here, JFTCO is not relying on the John Fabick Truck Company's use of the "Fabick" mark for purposes of defending against a claim of abandonment or some other theory based on JFTCO's continued use; rather, JFTCO points to its parent company's use of the mark to establish superior rights. As TTAB recognized itself, the holding and reasoning in that case is simply inapplicable to the issue here. See Noble House , 2016 WL 3357265, at *9 ("[T]he issue to be decided is not whether Respondent or its parent is entitled to use the NOBLE HOUSE mark for furniture in the United States."). Instead, as defendants argue in response, the appropriate test for determining whether JFTCO may rely on the John Fabick Tractor Company's superior rights is whether the John Fabick Tractor Company and JFTCO specifically, or its subsidiaries more broadly, "were operated in such a[ ] way that they appeared to the consuming public as one entity." Metro Traffic Control, Inc. v. Shadow Network Inc. , 104 F.3d 336, 340 (Fed. Cir. 1997) (citing W. Fla. Seafood, Inc. v. Jet Restaurants, Inc. , 31 F.3d 1122, 1126 (Fed. Cir. 1994), for the proposition "recognizing that separate corporate, business and personal entities that operate as a single entity in the eyes of the consuming public may be treated as such for trademark purposes").

Defendants contend that the John Fabick Tractor Company and its subsidiaries are presented just so, directing the court to the shared "Fabick" name in each of its wholly-owned subsidiaries: Fabick Machinery Company, Fabick & Company, Fabick Brothers Equipment Co., Fabick Southwest Co., Fabick Tractor Company of Tennessee, Fabick Power Systems, Inc., and JFTCO. (Note that JFTCO is simply the acronym of the John Fabick Tractor Company.) (Defs.' Add'l PFOFs (dkt. # 153) ¶ 72.) These entities share the same websites, and the John Fabick Tractor Company and JFTCO share the same Board of Directors and officers. In the face of this evidence, plaintiff simply points to the fact that on its invoices, JFTCO requires payment to JFTCO. That fact alone is obviously insufficient to find as a matter of undisputed fact that the John Fabick Tractor Company operated its business and subsidiaries in such a way that the consuming public did not view the entities as one.

Second , plaintiff argues that to rely on a prior use defense, defendants would also have to prove that the prior use of the JOHN FABICK TRACTOR COMPANY mark is the legal equivalent of the FABICK CAT mark, under a so-called "tacking" theory. (Pl.'s Opp'n (dkt. # 147) 24 (citing Hana Fin., Inc. v. Hana Bank , --- U.S. ----, 135 S.Ct. 907, 910, 190 L.Ed.2d 800 (2015) (explaining that the "general rule" is that two marks may be "tacked" when the original and revised marks are 'legal equivalents' " and holding that the issue of tacking is generally a question of fact for a jury). For purposes of proving tacking, defendants must demonstrate that the two marks "create the same, continuing commercial impression so that consumers consider both as the same mark." Hana Fin. , 135 S.Ct. at 910 (quotation marks and internal citation omitted).

Plaintiff's argument, however, is again grounded on a false premise: defendants are not arguing that the use of the JOHN FABICK TRACTOR COMPANY mark constitutes prior use, entitling them to use of the "Fabick" name; instead, as visually demonstrated above, defendants focus on the prior use of the FABICK mark. Still, factual disputes remain as to whether the consuming public would view the prior use of the FABICK mark as the same as the current use of JTFCO's Fabick CAT mark, as juxtaposed below:

In sum, questions remain as to: (1) whether the John Fabick Tractor Company's use of the "Fabick" mark either in Wisconsin or to establish a national brand was sufficient to constitute prior use; (2) whether JFTCO and the John Fabick Tractor Company are viewed by the consuming public as one entity for purposes of JFTCO relying on the John Fabick Tractor Company's prior use; and (3) whether the current Fabick CAT mark is the legal equivalent of the prior Fabick mark used by the John Fabick Tractor Company. For these reasons, the court will deny defendants' motion for summary judgment based on a prior use defense.

III. Likelihood of Confusion

The parties also filed cross motions seeking judgment in their respective favor depending upon whether a reasonable jury could find or would be compelled to find a likelihood of confusion. As is often the case when two sides look at the same set of facts and reach nearly polar opposite conclusions (as opposed to a dispute of law), this is usually a question for the trier of fact. In order to prevail on its Lanham Act claims, plaintiff must show that (1) its mark is protectable and (2) defendants' use of the mark is likely to cause confusion among consumers.

CAE, Inc. v. Clean Air Eng'g, Inc. , 267 F.3d 660, 673-74 (7th Cir. 2001). For purposes of summary judgment, the parties focus their attention on the second prong-likelihood of confusion.

Courts generally consider seven factors in determining the likelihood of confusion:

(1) the similarity of the marks in appearance and suggestion; (2) similarity of the products; (3) the area and manner of concurrent use; (4) the degree of care likely to be used by consumers; (5) the strength of the plaintiff's mark; (6) whether any actual confusion exists; and (7) the defendant's intent to palm off its goods as those of the plaintiffs.

Ty, Inc. v. Jones Grp., Inc. , 237 F.3d 891, 897 (7th Cir. 2001) (internal citation omitted). No single factor is dispositive, and the court may assign varying weights to each factor based on the particular case. Barbecue Marx, Inc. v. 551 Ogden, Inc. , 235 F.3d 1041, 1044 (7th Cir. 2000) (internal quotation marks omitted). The Seventh Circuit has, however, recognized that three of the factors are particularly important: the similarity of the marks, the defendant's intent and actual confusion. Id. (citing Eli Lilly & Co. v. Nat. Answers, Inc. , 233 F.3d 456, 461 (7th Cir. 2000) ). While the court analyzes each of the factors below, when viewed as a whole, defendants have raised a genuine issue of material fact as to whether JFTCO's use of the mark is likely to cause confusion among consumers, thus warranting denial of both parties' motions.

A. Similarity of the Marks

A court may examine marks for "similarity of 'sound, sight and meaning.' " Henri's Food Prods. Co., Inc. v. Kraft, Inc. , 717 F.2d 352, 355 (7th Cir. 1983) (quoting Plough, Inc. v. Kreis Labs. , 314 F.2d 635, 638 (9th Cir. 1963) ). "Different packaging, coloring, and labeling can be significant factors in determining whether there is a likelihood of confusion." Packman v. Chi. Tribune Co. , 267 F.3d 628, 644 (7th Cir. 2001). If one word or feature of a composite trademark is the salient portion of the mark, it may be given more weight than the surrounding elements. Int'l Kennel Club of Chicago, Inc. v. Mighty Star, Inc., 846 F.2d 1079, 1087-88 (7th Cir. 1988) (quoting Henri's Food Prods. , 717 F.2d at 356 ). Nevertheless, an inquiry into similarity will look at the entirety of the marks, not just one specific component. AutoZone, Inc. v. Strick , 543 F.3d 923, 929 (7th Cir. 2008).

The Seventh Circuit cautions that "when the public does not encounter the two marks together, it is inappropriate to focus on minor stylistic differences to determine if confusion is likely." Meridian Mut. Ins. Co. v. Meridian Ins. Grp., Inc. , 128 F.3d 1111, 1115 (7th Cir. 1997). Instead, courts must "make their comparison 'in light of what happens in the marketplace,' not merely by looking at the two marks side-by-side." Id. (quoting James Burrough Ltd. v. Sign of Beefeater, Inc. , 540 F.2d 266, 275 (7th Cir. 1976) ).

Given the prominence of the word "Fabick" in both marks, this factor would appear to weigh heavily in plaintiff's favor, or at least a reasonable jury could so find. Still, defendants stress: (1) the prevalence of the additional words "Coatings & Sealants," "Truck Liners," and similar words in some of plaintiff's logo; and (2) the use of "CAT" and Caterpillar's distinctive yellow and black color scheme in defendants' logo. Defendants argue that both undercut a finding of similarity.

In arguing their separate positions, the parties direct the court to a variety of cases considering similarities of marks, but it makes little sense to address them given the fact issues the jury must consider in weighing this factor-specifically, whether FABICK is the salient portion of both marks and whether CAT in the Fabick CAT mark is the salient portion are both factual questions for the jury. Similarly, while the court is inclined to take judicial notice that CAT is a famous mark, or at least that no reasonable jury could find otherwise on the evidence presented, the relevance of such a finding to distinguishing the Fabick CAT mark from FABICK remains a question for the jury, especially in light of plaintiff's primarily pursuing a reverse confusion claim. See Sorensen v. WD-40 Co. , 792 F.3d 712, 727-28 (7th Cir. 2015) (describing reverse confusion as likely claim where junior user has a famous mark). Finally, whether differences in font, color and style more generally undercut the importance of the shared name is also a question for the jury.

B. Similarity of Products

As noted generally above, Fabick is in the business of selling coatings and sealants in a number of industries, including construction, industrial, agricultural, highway construction and road building, mining, automotive and original equipment manufacturing. Fabick offers a wide range of coatings, designed to be either sprayed or poured on, including some requiring application using specifically-designed equipment and methods. Fabick's sealants have been similarly developed to provide protection in a variety of applications and are most commonly used in the highway, parking, weather and traffic sensor markets. The coatings and sealants are used on projects ranging from industrial equipment, vehicles and machinery to rock or slope paving. For example, when used on the bed of a dump truck, the coating creates a bedliner that covers the entire area of the dump box, forming a smooth, seamless surface that promotes payload release, reduces material retention and protects from rust and abrasion

As also noted above, JFTCO does not sell, nor has it ever sold, any chemical coating or sealant products, nor any bed liner products. Like FABCO, JFTCO continues to sell new and used Caterpillar equipment, including, dozers, dump trucks, skid steer loaders, among other types of equipment. (See Pl.'s PFOFs (dkt. # 93) ¶ 191.a.) Similarly, JFTCO sells new, used and remanufactured power systems parts for both Caterpillar and non-Caterpillar equipment, and it provides repair services for that equipment. Some of the industries that purchase JFTCO's products and services include agriculture, construction, forestry, landscaping, mining, oil and gas, paving and road building and waste. JFTCO also has a rental arm called "Fabick Rents-the Cat® Rental Store," which provides rental of Caterpillar machines. Plaintiff points out that the website also refers to itself simply as "Fabick Rents" without any reference to "CAT."

JFTCO's prices for purchasing a piece of equipment range from $20,000 to multiple millions of dollars. The vast majority of JFTCO's customers are either commercial entities or governmental bodies, and given the purchase prices, JFCTO customers often seek requests for proposals and review bids by JFTCO and its competitors before purchasing a piece of equipment. Parts and services are offered primarily with respect to Caterpillar equipment, often as a continuation of the dealer-purchaser relationship.

There is no dispute that the parties do not sell the same products. Trademark law, however, "prohibits use of a senior user's mark not only on products that are in direct competition with those of the senior user but also on products that are considered to be 'closely related' to the senior user's." Sands, Taylor & Wood Co. v. Quaker Oats Co. , 978 F.2d 947, 958 (7th Cir. 1992). "A 'closely related' product is one 'which would reasonably be thought by the buying public to come from the same source, or thought to be affiliated with, connected with, or sponsored by, the trademark owner." Id. (quoting 2 J. Thomas McCarthy, Trademarks and Unfair Competition § 24:3, at 166).

Here, plaintiff puts forth some evidence of cross-selling opportunities between its products and those of JFTCO, namely liners for dump truck beds, applications on non-fuel and hydraulic tanks used on heavy equipment, and coatings on buckets and blades that JFTCO sells as attachments to various pieces of CAT equipment. Still, as defendants point out, a review of plaintiff's sales since 2010, reveal minimal, if any, sales applicable to JFTCO's line of business. Indeed, as defendants point out, plaintiff is now almost exclusively a chemical supplier, with its largest customer of chemical products being a furniture manufacturer that uses Fabick's product to coat its furniture. Plaintiff's highest selling product is its Pour-Pac product, which is used to protect traffic and weather sensors in the grooves of concrete and/or asphalt roadways. In contrast, plaintiff's bedliner products represents a very minor portion of plaintiff's current revenues. Even if there were confusion, it would likely inure to plaintiff's benefit, in that defendants' association with the mark is likely to strengthen consumer confidence in plaintiff's products, not weaken it.

From this review, the similarity of products factor would, therefore, appear to cut against a finding of likelihood of confusion, but the jury would need to assess how closely related Fabick's sealants and coatings are to the products lines sold and supported by JFTCO. Moreover, as explained above, even if the court were to find the factor undisputable, this factor is less significant than the similarity of marks, evidence of actual confusion and defendant's intent in adopting the alleged infringing mark.

C. Area and Manner of Concurrent Use

For this factor, the court considers

(1) the relative geographical distribution areas; (2) whether there exists evidence of direct competition between the products; (3) whether the products are sold to consumers in the same type of store; (4) whether the products are sold in the similar section of a particular store; and (5) whether the product is sold through the same marketing channels.

Ty, Inc. , 237 F.3d at 900 (internal citations omitted). Some of these sub-factors touch on the same issues described above in considering the similarity of the products.

Plaintiff alleges trademark infringement based on defendants' use of the Fabick name in Wisconsin. Fabick markets and sells its products and services nationally and internationally, but Fabick's sole location is in Wisconsin, with over half of its sales to customers in Wisconsin. JFTCO currently has 19 locations in Wisconsin and one in Northern Michigan.

While there is no direct competition between plaintiff's and defendants' products, nor are the products sold at the same location, Fabick contends that the products are sold through the same marketing channels, to overlapping customers. In particular, Fabick represents that its "coatings are routinely applied to the types of machinery and equipment sold by FABCO and JFTCO," including dump trucks, the fuel and hydraulic tanks of heavy machinery, the cabs and walk surfaces or wear times of heavy equipment and machinery to create an anti-skid surface, snowplow blades, buckets on front-end loaders and dozers. (Pl.'s PFOFs (dkt. # 93) ¶ 103.) Moreover, since Fabick's coatings are customizable and sprayed or poured on to fit the specific application, Fabick's coatings could be applied to virtually any type of machinery or implement previously sold by FABCO and currently sold by JFTCO. Fabick has a fully-equipped mobile coating system, which allows it to apply coatings virtually anywhere and on any kind of service. For retail purposes, Fabick has outside applicators throughout Wisconsin that apply Fabick's coatings. Fabick also provides equipment for those outside applicators to use to apply the coatings and sealants, along with promotional items to market and advertise Fabick's products and services, including window stickers and template brochures.

While defendants do not appear to dispute that these type of applications are available, they contend that the application of plaintiff's products to the types of machinery and equipment sold by FABCO and JFTCO is "unusual and not routine," directing the court to plaintiff's sales records from January 2010 to November 2016. (Defs.' Resp. to Pl.'s PFOFs (dkt. # 150) ¶ 103.) Apparently conceding the same with respect to its current business mix, plaintiff contends that it is "actively seeking to expand its market share in providing off-highway dump truck bed coatings, as well as in providing anti-skid surfaces on a variety of heavy equipment that contains walk surfaces and wear items." (Pl.'s PFOFs (dkt. # 93) ¶ 104.) Plaintiff also contends that it shares a "number of common customers and vendors" with defendants. (Pl.'s PFOFs (dkt. # 93) ¶ 139.) Specifically, Fabick and JFTCO have at least 90 customers in common.

In response, defendants point out that many of the allegedly shared customers have not purchased any products or services from plaintiff since January 2010.

Defendants further contend that the "extent of the overlap between the customers is less than 3%." (Defs.' Resp. to Pl.'s PFOFs (dkt. # 150) ¶ 139.) While Fabick purports to dispute this calculation, it offers no basis for the dispute. (Pl.'s Reply to PFOFs (dkt. # 175) ¶ 139.) Even so, the parties' shared customers in Wisconsin include Epic Corp., University of Wisconsin-Madison, Tri-North Builders, the Wisconsin Department of Corrections, the Dane County Regional Airport, Dane County, City of Madison, Capital Underground, McFarlane Manufacturing Co., Oil Equipment Company, Inc., and Monroe Truck Equipment.

Under Jay's ownership since 1997, Fabick has also continued to market to defendants' customers and to the same industry groups serv