Fila U.S.A., Inc. v. Nam Joo Kim

Citations: 884 F. Supp. 491; 34 U.S.P.Q. 2d (BNA) 1657; 1995 U.S. Dist. LEXIS 9068; 1995 WL 235686Docket: 93-0604-CIV

Court: District Court, S.D. Florida; February 6, 1995; Federal District Court

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FILA U.S.A. INC. and Fila Sport, S.p.A. filed a lawsuit against Nam Joo Kim and Nexus International Trading Co., Inc. in the United States District Court for the Southern District of Florida, alleging trademark infringement and unfair competition concerning Fila and Reebok footwear. The plaintiffs sought relief under the Lanham Act (15 U.S.C. § 1051 et seq.) and Florida law. Prior to this motion, the Court issued a Temporary Restraining Order and other orders to secure Defendants' assets, which were executed by law enforcement in Florida and Pennsylvania, resulting in the seizure of athletic shoes and related documents.

The case stemmed from an investigation where a plaintiff's investigator negotiated with Defendant Kim for the purchase of athletic shoes, ultimately discovering that the Reebok shoes were counterfeit during a factory inspection in Korea. Defendant Kim denied the allegations, claiming he had never engaged in the sale of counterfeit products and questioned the existence of the shoes in question.

The Court confirmed its jurisdiction under federal trademark laws and Florida state laws, and determined that venue was appropriate. The legal standard for summary judgment requires demonstrating the absence of genuine disputes over material facts. The Court must view evidence favorably towards the non-moving party and initially place the burden on the moving party to show no genuine issue exists. If successful, the burden shifts to the non-moving party to prove otherwise. The order ultimately granted the plaintiffs' motion for summary judgment regarding the defendants' liability.

The non-moving party in a legal motion must present evidence beyond mere pleadings that could lead a reasonable jury to favor them, as a minimal amount of evidence is insufficient to counter a motion for summary judgment. A trademark functions as a distinctive identifier for products, and the Lanham Act aims to regulate commerce by addressing deceptive use of trademarks, protecting registered marks from state interference, preventing unfair competition, and providing legal remedies. To succeed in a trademark infringement claim under the Lanham Act, a plaintiff must demonstrate the validity of their mark and that the defendant's usage likely causes consumer confusion regarding the source of goods or services. A registered trademark serves as prima facie evidence of its validity and the registrant's exclusive rights. The court assesses the likelihood of confusion using a seven-factor test, which includes the type of trademark, design similarity, product similarity, retail and purchaser identity, advertising media, defendant's intent, and instances of actual confusion. In cases involving counterfeit goods, the focus is on their near-identical nature to genuine products, which aims to mislead consumers. In this instance, Plaintiff Reebok has established its federally registered trademarks and exclusive rights, and it has been shown that the shoes sold to Mills, manufactured in Korea, are counterfeit.

Reebok’s affidavits and related documents demonstrate that the counterfeit shoes infringe on its trademarks and compete directly with its legitimate products, as the counterfeit items bear identical marks, leading to a high likelihood of consumer confusion. Defendant Kim failed to provide evidence disputing the counterfeit nature of the shoes, merely questioning their existence and authenticity without substantiating his claims. His denial of wrongdoing and assertion of acting solely as a translator do not create a genuine issue of material fact. Additionally, Kim did not present any evidence to counter Reebok’s claims regarding the extent of his involvement in the counterfeit shoe operation. Consequently, the Court finds no disputed material facts regarding Reebok's trademark infringement claim. 

Under 15 U.S.C. 1125, the same standard for determining likelihood of confusion applies to claims of unfair competition as it does to trademark infringement. Since there are no factual disputes regarding trademark infringement, the same applies to the unfair competition claim. Evidence submitted includes Kim's acknowledgment of preparing false documentation indicating the shoes were made in the USA, further undermining his defense. The Court concludes that Kim has not raised any genuine issues of material fact related to the unfair competition claim under 15 U.S.C. 1125. 

In conclusion, the Court grants Reebok's Motion for Summary Judgment regarding Defendants' liability under 15 U.S.C. 1114 and 1125, and also grants Fila's Motion for Summary Judgment under 15 U.S.C. 1125, ordering a separate hearing to determine damages.

Defendants argue that Plaintiff Fila has not provided sufficient grounds for summary judgment on the Fila mark, noting the absence of registered trademarks in the Complaint and the lack of specific references to FILA shoes in supporting documents. Plaintiff Fila seeks to amend the pleadings to include its trademarks, citing Federal Rule of Civil Procedure 15(b), which allows for unpled issues to be acknowledged if tried with consent. However, the Court determines that Rule 15(b) is not applicable in this context, as it pertains to issues raised during trial rather than those presented in a summary judgment motion. Consequently, the Court denies the request to amend the pleadings. Regarding unfair competition, it is clarified that a trademark does not need to be registered for liability under 15 U.S.C. § 1125. Additionally, Defendant Kim contends that the Plaintiffs failed to demonstrate that a transaction occurred, but liability under the Lanham Act does not require a completed transaction; it arises from the use of counterfeit trademarks in connection with goods or services likely to cause confusion. Finally, Defendant Kim confirms authorship of a document referenced by the Plaintiff.