Algood Casters Limited v. Caster Concepts, Inc.

Background

Algood Casters Limited designs, manufactures, and sells casters. The opinion states that Algood is based in Ontario, Canada, and has used the unregistered MAXX trademark in connection with casters since at least 2001, including MAXX, EMAXX, and MAXX9.

Caster Concepts, Inc. sells industrial and heavy-duty casters. The opinion states that Caster is a Michigan corporation. Caster began using ERGOMAXX and TWERGO in 2015, later used “Ergonomically ErgoMaxx Engineered,” and began using “Twergo Maxx” around January 2019. Caster also used “Ergo® Maxx” as two separate words. The United States Patent and Trademark Office registered “Ergonomically ErgoMaxx Engineered” in 2019, while an earlier application for ErgoMaxx was deemed abandoned.

Algood sought monetary damages and injunctive relief based on Caster’s use of “Maxx.” For immediate relief, Algood asked the court to require Caster to stop using “Maxx” by itself in connection with sales, stop introducing new trademarks containing “Maxx,” and stop emphasizing “maxx” within other designations. Algood’s president asserted that Caster’s use would take advantage of Algood’s goodwill, create marketplace confusion, and cause lost profits. Caster’s president denied receiving earlier notice of alleged infringement, denied awareness of confusion, and stated that Caster did not intend to expand its use of “maxx” beyond the Ergomaxx and Twergo Maxx product lines.

Legal standard

A preliminary injunction is an order issued before trial that requires a party to do or stop doing something. In this trademark case, the court applied a standard requiring Algood to show likely irreparable harm—harm that money damages could not adequately remedy—and either a likelihood of success on the claims or serious questions warranting litigation plus a balance of hardships strongly favoring Algood.

Court’s analysis

Irreparable harm. The court held that Algood had not shown immediate irreparable harm. Algood waited years after Caster began using ErgoMaxx and more than a year after Caster began using Twergo Maxx. The court stated that this delay weakened the claimed urgency and was sufficient grounds to deny preliminary relief.

The court also found that Algood had not offered evidence of lost business, threatened lost business, loss of control over its mark, or damage to its reputation. It characterized the supporting statements from Algood’s president as conclusory and insufficient by themselves. The court further found that Algood’s concern that Caster might later use “Maxx” for additional products was speculative, particularly because Caster had stated under oath that it had no plans to do so.

Likelihood of success. The court applied the Second Circuit’s eight-factor test for whether consumers are likely to be confused by two marks. The court observed that the evidence before it suggested that Caster’s products were heavy-weight industrial casters, while Algood’s MAXX line consisted of low- and middle-weight casters. It also noted the absence of evidence of actual customer confusion and the different sales methods used by the companies. The court inferred that the relevant purchasers were sophisticated and found that the likelihood of confusion was not sufficient to justify preliminary relief.

The court expressly stated that it was not deciding which party had greater rights to the MAXX mark. It decided only that Algood had not met the requirements for an injunction at this stage.

Balance of equities. The court stated that the balance of equities did not necessarily favor Algood. Both parties had an interest in using “Maxx” with their products, and Caster had used its relevant designations for years and presumably invested resources and goodwill in them. The court therefore could not conclude that the balance clearly favored Algood.

Disposition

The court denied Algood’s motion for a preliminary injunction and temporary restraining order. It also directed the parties to submit a proposed case-management plan and scheduling order by September 11, 2020, and scheduled an initial pretrial conference for September 15, 2020.