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Southern Grouts & Mortars, Inc. v. 3M Co.

Citations: 575 F.3d 1235; 91 U.S.P.Q. 2d (BNA) 1545; 2009 U.S. App. LEXIS 16600; 2009 WL 2182605Docket: 08-15850

Court: Court of Appeals for the Eleventh Circuit; July 23, 2009; Federal Appellate Court

Original Court Document: View Document

Narrative Opinion Summary

In this case, Southern Grouts Mortars, Inc., a Florida corporation, contested 3M Company's registration of the diamondbrite.com domain, claiming violations of the Anticybersquatting Consumer Protection Act (ACPA) and unfair competition under the Lanham Act. The dispute arose as 3M, although not using the domain actively, continued to renew it in order to prevent market confusion with its DIAMOND GRADE products. Southern Grouts argued that 3M demonstrated a 'bad faith intent to profit,' but the district court found this claim unsupported, granting summary judgment for 3M. The court held that Southern Grouts' claims were barred by laches and lacked evidence of bad faith. Furthermore, Southern Grouts' motion to amend their complaint to include issues related to a Google AdWords purchase was denied due to lack of diligence and failure to meet the 'good cause' standard under Fed. R. Civ. P. 16(b). The district court also ruled against Southern Grouts' unfair competition claim, citing insufficient evidence of 3M's use in commerce and likely confusion. The court's decisions were upheld on appeal, affirming 3M's position and the district court's application of procedural and substantive legal standards.

Legal Issues Addressed

Amendment of Pleadings under Federal Rule of Civil Procedure 16(b)

Application: The court denied Southern Grouts' motion to amend the complaint because it failed to show 'good cause' as required by Fed. R. Civ. P. 16(b), given the lack of diligence in seeking amendments post-deadline.

Reasoning: A plaintiff must show 'good cause' to amend a complaint after the deadline set by a scheduling order, as per Fed. R. Civ. P. 16(b).

Anticybersquatting Consumer Protection Act (ACPA) Claims

Application: The court granted summary judgment for 3M on the ACPA claim, finding Southern Grouts failed to demonstrate 3M's 'bad faith intent to profit' as required by the ACPA.

Reasoning: Regarding Southern Grouts' claim under the Anticybersquatting Consumer Protection Act (ACPA), the district court granted summary judgment to 3M, ruling that the claim was barred by laches and that Southern Grouts failed to demonstrate 3M's 'bad faith intent to profit' as required by the ACPA.

Expert Testimony and Admissibility

Application: The court deemed the expert report by Robert Moody inadmissible due to its lack of specificity and conclusory nature, impacting Southern Grouts' ability to prove claims against 3M.

Reasoning: Robert Moody's expert report asserts that 3M benefits commercially from its ownership of the diamondbrite.com domain by collecting information from it. However, the report lacks specific citations and does not explain 3M's actual capabilities or actions regarding the domain, leading the district court to deem it as containing mostly conclusory statements and therefore inadmissible.

Summary Judgment and Laches Defense

Application: The court affirmed summary judgment for 3M, holding that Southern Grouts' claims were barred by laches due to inaction over an extended period.

Reasoning: Ultimately, the court granted summary judgment in favor of 3M and denied Southern Grouts’ motion, ruling that the claims were barred by laches and lacked merit.

Unfair Competition under the Lanham Act

Application: The court ruled in favor of 3M on the unfair competition claim, noting Southern Grouts failed to show use in commerce or likely confusion under the Lanham Act.

Reasoning: Further, the court affirms the district court's summary judgment in favor of 3M on the unfair competition claim under the Lanham Act, citing laches and Southern Grouts’ failure to demonstrate 3M's use in commerce or sufficient evidence of likely confusion.