“SOF” refers to Doc. #51, Defendants’ Local Civil Rule 1

56.1 Statement of Material Facts. 

-1-

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

------------------------------------x

SEAT SACK, INC.,

07 Civ. 3344 (DFE)

Plaintiff,

(This is an ECF case.)

 

- against -

OPINION AND ORDER

CHILDCRAFT EDUCATION CORP., and 

SCHOOL SPECIALTY, INC.,

Defendants.

------------------------------------x

DOUGLAS F. EATON, United States Magistrate Judge.

Plaintiff Seat Sack, Inc. has alleged thirteen causes of

action against the two defendants: Childcraft Education Corp.

(“Childcraft”) and School Specialty, Inc. (“School Specialty”).

In February 2008, I denied Plaintiff’s motion for a

preliminary injunction. On January 27, 2009, the defendants

filed a motion for summary judgment. (Docs. ##50-58.) On

February 13, 2009, Plaintiff filed a cross-motion for summary

judgment. (Docs. ##59-63.) On February 26, 2009, the defendants

filed reply papers. (Docs. ##64-66.) On March 5, 2009, Plaintiff

filed additional papers. (Docs. ##67-69.) On March 12, 2009,

the defendants filed a motion to strike Doc. #67 and Doc. #69. 

(Docs. #70-71.) On March 13, 2009, Plaintiff filed papers

opposing the motion to strike. (Docs. ##72-73.)

For the reasons set forth in today’s Opinion and Order, I

deny the defendants’ motion to strike (Doc. #70), I grant the

defendants’ motion for summary judgment (Doc. #50), and I deny

Plaintiff’s cross-motion for summary judgment (Doc. #59). I am

today entering a Judgment in favor of the defendants.

The Parties

Childcraft is a New York corporation headquartered in

Pennsylvania. At all relevant times, it has been a wholly-owned

subsidiary of School Specialty, a Wisconsin corporation. (SOF

¶1.) School Specialty markets and sells educational products, 1
-2-

programs and services to schools through various brands,

including the “Childcraft” brand. (SOF ¶¶2-3.) Childcraft

markets and sells thousands of various educational products

through its catalog, website, and sales staff. (SOF ¶4.) 

Plaintiff is Florida corporation wholly owned by Anne

McAlear. In the early 1980’s, she owned a company called The

Nursery Collection, which manufactured infant bedding. Its

number of employees grew from 3 to 38, and she sold the company

around 1994. (4/4/08 McAlear Depo. Tr. 9-10.) In 1993, she

designed the Seat Sack. In 1995, she retained a patent attorney

and the U.S. Patent Office issued a design patent to her. The

Seat Sack is a sack that drapes across the back of a student’s

chair and holds school supplies. She began manufacturing it and

selling it in 1995. In 1998, she started selling it to schools

in large cities, including New York City. In 1999, she

incorporated the business and hired one employee. (McAlear Depo.

Tr. 14-25.)

The Contractual Relationship

Between Plaintiff and Childcraft

At her deposition, Ms. McAlear vaguely recalled having

conversations with Childcraft’s Liz Plotkin prior to late January

2000: “I agreed to send samples and literature and pricing to her

to see – - she was going to see about putting it [the Seat Sack]

in the catalogue. That’s pretty much all of our first

conversation.” (McAlear Depo. Tr. 23-24.) 

Q: .... Do you recall the substance of any other

conversations with her other than your initial conversation?

A: Not really.

Q: Did you ever make any notes of conversations with

Ms. Plotkin?

A: No. 

(McAlear Depo. Tr. 41-42.)

In late January 2000, Childcraft’s Liz Scott sent Ms.

McAlear a one-page form entitled “Childcraft Education Corp.

Exclusives – - Growing Years Catalog” (the “Agreement”). On

January 28, 2000, after the word “Vendor,” Ms. McAlear wrote

“Seat Sack Inc.” (the name of her corporation), and she signed 

the form as President. (SOF ¶6.) Childcraft has entered into

this type of agreement with hundreds of vendors for the sale of
-3-

thousands of products that are featured in Childcraft’s catalogs. 

(SOF ¶8.) The document said, in pertinent part:

EXCLUSIVITY: We [Childcraft] are requesting

information on the items listed below which are

featured in Childcraft Education Corp.'s

Growing Years Catalog. Terms of exclusivity include:

CODE A. EXCLUSIVE PRODUCTS UNDER CHILDCRAFT LABEL:

Products manufactured for Childcraft by other

manufacturers/vendors and labeled with the Childcraft

name.

CODE B. EXCLUSIVE PRODUCTS NOT BEARING CHILDCRAFT

LABEL but manufactured by a vendor who has given

Childcraft the exclusive right to be the “sole source”

of the product. .....

CODE C. EXCLUSIVE COLLECTIONS: .....

Please sign this page (or respond in writing if items

are not exclusive to Childcraft) and return AS SOON AS

POSSIBLE to Liz Scott at the fax number below.

Thank you for your prompt response to this request.

Product Childcraft Vendor Exclusivity

Description Item # Item # Code

SEAT SACK #370631 seatsack3 A

This letter is to confirm exclusivity of the vendor's

product(s) listed created for Childcraft Education

Corp. .....

It is undisputed that the Seat Sack was classified under

“Exclusivity Code A.” Ms. McAlear testified as follows:

Q: Isn’t it true that when the idea of exclusivity

came up, your belief was that Childcraft was asking

that you sell to Childcraft and to no one else?

A: Yes, it was.

Q: And then you called Liz Scott to talk about that,

right?

A: Yes. And that’s where all of this conversation
-4-

came from.

Q: What Ms. Scott told you in that conversation is no,

that’s not accurate, we’re asking for the right to

exclusively sell only those Seat Sacks that have the

Childcraft name on them, isn’t that true?

A: Right.

(McAlear Depo. Tr. 73.)

 

On those Seat Sacks which Plaintiff manufactured for

Childcraft, the name “Seat Sack” was written in large print on

the outside of the product; inside the product, Plaintiff placed

a small Childcraft label with instructions about how to re-order

the product from Childcraft. (McAlear Depo. Tr. 47-48.) 

Plaintiff added this label only to those Seat Sacks that were

sold to Childcraft. (Id.; Pl’s Resp. to Interrog. No. 2,

attached as Exh. C to Doc. #56.) 

Ms. McAlear testified as follows. The Agreement did not

require Childcraft to buy Seat Sacks from Plaintiff. Childcraft

never committed to buy a minimum number of Seat Sacks. (McAlear

Depo. Tr. 53.) Plaintiff was free to sell Seat Sacks to other

customers, provided that those Seat Sacks did not bear a

Childcraft label. (Id. Tr. 73, 77.) At any time, Plaintiff

could have told Childcraft that Plaintiff was no longer

interested in selling to Childcraft, and Plaintiff could have

requested that the Seat Sack not be placed in the Childcraft

catalog. (Id. Tr. 90-91.)

The Course-of-Dealing Relationship

Between Plaintiff and Childcraft

During the years from 2000 to 2005, Childcraft purchased

thousands of Seat Sacks from Plaintiff. (Doc. #57, 8/23/07

Murphy Decl. ¶¶5, 16, 18.) The purchases were made as follows. 

Childcraft would send a purchase order to Plaintiff, which would

then manufacture and ship the requested Seat Sacks to Childcraft,

together with an invoice. Childcraft always paid the invoices,

and Plaintiff admits that Childcraft owes no money on any of

Plaintiff’s invoices. (McAlear Depo. Tr. 83-84, 99.) 

The Seat Sacks purchased by Childcraft became part of the

inventory of Childcraft, which in turn sold the Seat Sacks

through Childcraft’s website and catalog. (Murphy Decl. ¶¶6,

19.) Once Childcraft paid Plaintiff’s invoice, it is undisputed

that Childcraft was free to resell the Seat Sacks at any price it
-5-

chose. And Plaintiff was not entitled to any more payments, such

as a percentage of Childcraft’s retail sales. (McAlear Depo. Tr.

37, 84, 88-89.)

Prior to Childcraft, Ms. McAlear had marketed through Babies

R Us (it appears that this was only in connection with her prior

company The Nursery Collection). (McAlear Depo. Tr. 39.) 

Starting in 2000, Childcraft was Plaintiff’s largest customer. 

Plaintiff started a small website in 2000, but it did not have

the capacity to take an on-line order until around the end of

2003. Plaintiff’s annual sales increased from roughly $10,000 in

1999 to more than $20,000 in 2000. In each of the next four

years, Plaintiff’s sales increased by 49% or more. By contrast,

the annual growth was only about 8% in 2005 and 2006, and

Plaintiff’s sales declined 5% in 2007. (McAlear Depo. Tr. 26-

32.) 

For the year 2004, Plaintiff’s top four customers were: 

Childcraft (approx. $90,000), School Specialty (approx. $66,000),

School Specialty’s other divisions (approx. $10,000) and a

company named Demco (approx. $6,000). Plaintiff’s sales to

Childcraft declined in 2004 and stopped in 2005. (2/12/09

McAlear Aff. ¶9.) However, for the year 2007, School Specialty

(the parent company of Childcraft, named as a defendant in the

Complaint filed 3/5/07) was “probably” Plaintiff’s top customer,

and it was still a customer as of 2008. As of 2008, Plaintiff

had 3,000 customers, by Ms. McAlear’s rough estimate. (McAlear

Depo. Tr. 159-62.)

Around 2000, Ms. McAlear’s attorney invoked her design

patent and sent a cease-and-desist letter to a company that was

selling a similar product called the “Aussie Pouch.” That

company’s attorney declined to stop, and Ms. McAlear decided not

to sue. (McAlear Depo. Tr. 65-66.)

Significantly, Ms. McAlear knew that Childcraft’s parent

company (the co-defendant School Specialty) was the distributing

agent for the Aussie Pouch. She did not object to that, and her

company continued to sell the Seat Sack to School Specialty as

well as to Childcraft. “Aussie Pouch and School Specialty were

together long before I sold to Childcraft. Why would I dispute

that?” (McAlear Depo. at Tr. 58.) 

At Tr. 60, Ms. McAlear answered the following question:

Q: Let’s think then about 2002. Just pluck a year out

of the air before the Seat Pocket ever became an issue. 

According to your understanding of Seat Sack’s
-6-

relationship with Childcraft, if the 2002 Childcraft

catalogue had included both the Seat Sack and the

Aussie Pouch would that have violated any agreement

between Childcraft and Seat Sack?

A: No. ....

However, at Tr. 61, there was a lunch break in the

deposition. After lunch, she recanted the “No” answer she had

given at Tr. 60. At Tr. 63, she said: “We had more of a

fiduciary type of relationship.” At Tr. 69, she said that she

had mixed up the “right to sell” with “my relationship with

Childcraft.” (Tr. 69.) At Tr. 66, she asserted that

Childcraft’s Liz Scott had said “that there would be no

competition.” Ultimately, however, Ms. McAlear could not recall

Ms. Scott ever saying that Childcraft would not sell competing

products. Ms. McAlear testified: 

Q: .... Without regard to the Aussie Pouch or any

other specific competitor, what did Ms. Scott say to

you that led you to believe that Childcraft would not

sell competing products?

A: That they would just do - - it was an agreement

that they would do their best to sell my product, and I

would do my best to manufacture my product and get it

to them in a timely manner. (Tr. 67.)

* * * * *

Q: I want to be very clear here. What I’m asking

about right now is any conversations that you had with

Ms. Scott. What did she say in those conversations

that led you to believe that Childcraft would not sell

a competing product?

A: The exclusivity, when we talked about the exclusive

right to sell. That was when we discussed whether they

would sell another product that was the same as mine.

Q: Did you ask about that?

A: Well, I asked her - - I said to her, “If I’m

selling these to you and you want to be exclusive, why

would I do that?” And she told me the team of

salespeople they had, the amount of catalogues they had

going out, how they would do their best to sell my

product.
-7-

 She didn’t say I’m going to do my best to sell your

product and I’m going to bring in the Aussie Pouch. 

Sometime it’s the things you don’t say. (Tr. 67-68,

emphasis added.)

* * * * *

Q: Did she ever say to you, again not in these words

but in effect, we won’t sell a competing product?

MR. CARROLL: Do you understand the question?

A: I understand the question. I’m thinking about the

answer.

MR. CARROLL: That’s fine.

A: Whether she actually said it or it was implied, I’m

sorry, I can’t even tell you if it was actually said or

implied. (Tr. 70-71, emphasis added.)

Central to many of Plaintiff’s claims is Ms. McAlear’s

assertion that there was a “special relationship” between

Childcraft and Plaintiff. She may have believed that such a

relationship existed, but such belief was not based on anything

that Childcraft said or did. She testified:

Q: You said that if customers would contact you, you

would refer them to Childcraft?

A: Yes.

Q: Is that something Ms. Scott asked you to do?

A: Also maybe it was implied if you have a customer

like that that you had a relationship with. (Tr. 71,

emphasis added.)

* * * * *

Q: You were free to sell Seat Sacks without the

Childcraft name to anyone you wanted, correct?

A: Without the Childcraft name[.] But we didn’t

promote them to other companies like we did to

Childcraft.

Q: But that was your decision, wasn’t it?
 There is no claim that Liz Scott was president of 2

Childcraft. Ms. McAlear testified that she is not sure what

position Ms. Scott held within Childcraft, simply that Ms. Scott

was Childcraft’s contact with Plaintiff. (McAlear Depo. Tr. 34-

35.) 

-8-

A: It was a relationship we had. It was like you

don’t go and tell another woman how beautiful she is

when you’re married. You just don’t. It’s a different

relationship. Or seeking someone else. 

Q: Did Ms. Scott ever tell you[:] while you’re free

to do so, we really would prefer it if you didn’t sell

to anyone else?

A: She said that they wanted to be first, they wanted

their products out there first. .... (Tr. 73-74,

emphasis added.)

* * * *

Q: .... As you sit here right now, do you recall any

other conversations with Ms. Scott in which she said

something that led you to believe that this was a

special relationship?

A: Every conversation we had led me to believe it was

a special relationship. Just that she called me was a 

special relationship. If the president of Wal-Mart

called you, don’t you think you’d have a relationship

with them? 2

Q: Anything other than the fact that she called you?

A: It’s eight years now. Let me think.

Q: Take your time.

A: The conversation I had with her asking her if I

could direct the people to Childcraft for any of my

specials and that I would reduce Childcraft’s price. 

I didn’t do that to anyone else.

Childcraft was the only one paying $3.95. 

Everyone else was paying $4.95. There was never a

special or any advertising that I did that had a

special that went to anyone else but Childcraft.

Q: The special price was your idea, right?
-9-

A: Yes, it was. It’s like having a realtor and you

lower your price to sell. It’s like the relationship

you have with your realtor.

Q: Any other conversations that come to mind that you

can recall with Liz Scott or anyone else at Childcraft

that led you to believe that this was a special

relationship?

MR. CARROLL: A continuing objection to what a 

“special relationship” is.

A: I think I have told you all of them. Let me think. 

(Tr. 81-83, emphasis added.)

As mentioned earlier, right after the lunch break, Ms.

McAlear asserted that Plaintiff and Childcraft had “more of a

fiduciary type of relationship.” (Tr. 63.) “Fiduciary” is a

word that carries extraordinary consequences, but questioning

revealed that she was trying to apply that word to a very

ordinary relationship with a large customer. At Tr. 72, she was

questioned as follows:

Q: First of all, can you describe what you mean 

when you say “fiduciary relationship”? What do 

you mean by that?

A: It would be a relationship that we agreed upon 

that we – - how can I explain this – - that we were 

both in agreement of.

Q: In what way was that relationship different than

another relationship with a mom and pop store?

A: A mom and pop store never said to me ... I’m 

going to give all of my efforts to sell your product

and you give your efforts to deliver to me and 

help us to sell your product, you have to give us

samples. Mom and pop stores wouldn’t do that, ....

Q: Sending samples to salespeople, that’s a tool 

to sell Seat Sack, correct?

A: Right.

(McAlear Depo. Tr. 72.)
-10-

Childcraft’s Introduction of the Seat Pocket

It is undisputed that Plaintiff was entitled to sell the

Seat Sack (without the Childcraft label) to anyone that Plaintiff

chose. Childcraft alleges that it discovered, in 2003, that

Plaintiff was offering to sell the Seat Sack to Childcraft’s

competitors at a price lower than the price at which it sold to

Childcraft, and that Plaintiff was offering the Seat Sack for

sale directly to teachers at a price lower than offered in the

Childcraft catalog. (SOF ¶¶27-28.) Plaintiff disputes this, but

it is unnecessary to resolve that dispute. Regardless of who is

right about that dispute, Childcraft was free to offer the public

both the Seat Sack and a competing product. The competing

product could be manufactured by one of Childcraft’s other

suppliers, or by Childcraft itself. 

In July 2003, Childcraft began developing its own competing

product. It is not radically different from the Seat Sack, but

it contains two additional storage pockets and this creates a

distinctive appearance; when it is draped on a chair and is

viewed from the rear, the two pockets mimic the appearance of the

two rear pockets on the seat of a pair of pants. Childcraft

named its product the “Seat Pocket.” Ms. McAlear would have felt

less aggrieved if Childcraft had taken three steps: if

Childcraft had eschewed the word “Seat” and named the new product

something like “Chair Pocket,” if Childcraft had kept its retail

price for the Seat Sack at $9.95 rather than increasing it to

$11.95, and if Childcraft had given Ms. McAlear specific notice

about what it was doing. But the legal question is whether

Childcraft was required to take any of those three steps. 

Childcraft began offering the Seat Pocket for sale through

its catalog in January 2004. (SOF ¶32.) During 2004 and 2005,

Childcraft continued to offer both Seat Sacks and Seat Pockets

for sale. (Doc. #57, Murphy Decl. ¶16.) Childcraft’s last

purchase of Childcraft-branded Seat Sacks occurred in or about

September 2005. (Id. ¶18.) Plaintiff says that it did not

learn about the existence of the Seat Pocket until 2006.

On March 5, 2007, Plaintiff filed its Complaint in Supreme

Court, New York County. The defendants removed the case to our

Court on the basis of diversity of citizenship. Plaintiff says

that our Court should apply the laws of New York to this lawsuit

except for the claims of trademark infringement and design patent

infringement. Defendants’ 1/27/09 memorandum, at page 16, fn. 5,

says: “For purposes of this motion only, and without waiving any

rights with respect to the choice of law, Childcraft Defendants
-11-

will assume New York law applies.”

Additional Facts Relevant to

Plaintiff’s Trademark Claims

Exhibit J to Ms. McAlear’s 2/12/09 affidavit is a printout

from the Trademark Electronic Search System (“TESS”) of the U.S.

Patent and Trademark Office. It shows that Plaintiff applied to

register the word mark “Seat Sack” on May 15, 2000 but abandoned

the application on February 5, 2002. It also shows that

Plaintiff again applied to register the word mark “Seat Sack” on

August 18, 2006, but that registration has not been granted to

Plaintiff, who is still described by TESS as an “Applicant”

rather than as a “Registrant.” 

Plaintiff chose the name “Seat Sack” because the product is

a sack that works in conjunction with a seat. Likewise,

Plaintiff chose names for its other products that describe the

function of those products. Thus, Plaintiff sells a “File Drawer

Sack,” and chose the name because the product is a sack that

hangs on a file drawer. Plaintiff also sells a “Locker Sack,”

which it named because the product is a sack that hangs inside a

locker. Plaintiff’s “Office Sack” was so named because it is a

sack that is designed for use in an office or cubicle. The

“Lock-n-Sack” is designed for use in or on a child’s locker, and

Ms. McAlear chose that name because that product “locked and it

was a sack, and ‘Sack’ was my name.” (McAlear Depo. Tr. 126-27.)

Additional Facts Relevant to Plaintiff’s

Claim of Design Patent Infringement

Ms. McAlear owns a design patent issued by the U. S. Patent

and Trademark Office bearing number Des. 358,731, dated May 30,

1995 (the ‘731 Patent). There is no evidence of any written

assignment of the design patent from Ms. McAlear to her

corporation. (SOF ¶70.) She incorporated her business in 1999. 

(McAlear Depo. Tr. 7-8.)

The ‘731 Patent claims an “ornamental design for sack for

hanging on the back of a chair, as shown.” The black and white

drawings and figures in the patent depict an unadorned pouch from

various angles. No other ornamentation is shown. (Exh. A to

the 2/12/09 McAlear Affidavit.) 

Plaintiff testified that “anything that would go on the back

of a chair I had an exclusive right to.” (McAlear Depo. Tr. 65.)

However, her attorney’s memorandum of law makes no claim that she

or her corporation has such a broad right. 
-12-

Additional Facts Relevant to

Plaintiff’s Trade Secrets Claim

Count IV alleges that Childcraft misappropriated 

Plaintiff’s trade secrets. According to Ms. McAlear, the alleged

trade secrets are: “My design, my patent, the people that we were

selling it to that I had them go directly to Childcraft.” 

(McAlear Depo. Tr. 100.)

She admits that anyone holding a Seat Sack can see its

design. (Id. Tr. 101.) Similarly, the design patent for the

Seat Sack is a public record available for the world to see, as

Ms. McAlear again admits. (Id. Tr. 103.) As for the names of

customers that she had previously been selling to, it seems clear

that she provided those names to Childcraft; there is no evidence

that Childcraft “misappropriated” those names. (Id. Tr. 103.) 

SUMMARY JUDGMENT STANDARDS

On a motion for summary judgment, we are not talking about

the adequacy of Plaintiff’s pleadings; we are talking about the

adequacy of Plaintiff’s evidence. Summary judgment is

appropriate “if the pleadings, depositions, answers to

interrogatories, and admissions on file, together with the

affidavits, if any, show that there is no genuine issue as to any

material fact and that the moving party is entitled to a judgment

as a matter of law.” FED. R. CIV. P. 56(c). Summary judgment is

the “put up or shut up” time for the party that brought the

lawsuit. See Weinstock v. Columbia Univ., 224 F.3d 33, 41 (2d

Cir. 2000) (quoting FLEMING JAMES, JR. & GEOFFREY C. HAZARD, JR., CIVIL

PROCEDURE 150 (2d ed. 1977)). Accordingly, “the plain language of

[Rule] 56(c) mandates the entry of summary judgment, after

adequate time for discovery and upon motion, against a party who

fails to make a showing sufficient to establish the existence of

an element essential to that party’s case, and on which that

party will bear the burden of proof at trial.” Celotex Corp. v.

Catrett, 477 U.S. 317, 322 (1986).

When opposing a motion for summary judgment, a plaintiff

that has given testimony in a deposition cannot create a triable

issue of fact by merely submitting an affidavit that contradicts

the plaintiff’s deposition testimony. Perma Research & Dev. Co.

v. Singer Co., 410 F.2d 572, 578 (2d Cir. 1969); see also Hayes

v. New York City Dep't of Corrections, 84 F.3d 614, 619 (2d Cir.

(1996).
-13-

DISCUSSION

The Complaint lists 13 causes of action, but I will refer to

them as “counts” for the sake of brevity, since that is the

terminology used in the Defendants’ 1/27/09 memorandum of law

(Doc. #58). Also, I will address the 13 “counts” under five main

headings. Essentially, I will put these main headings in the

order used in Doc. #58, except that I will reverse the order of

the fourth and fifth headings. 

First, I will address the claims that are resolved by

reference to the contract, including the claims for breach of

contract (Count V), breach of fiduciary duty (Counts IV and VI),

conversion (Count III), and unjust enrichment (Count XIII). 

Second, I will address the fraud claims (Counts I and II). 

Third, I will address the trade secrets claim (part of Count IV). 

Fourth, I will address the claims of infringement of the design

patent (parts of Counts VII and VIII). Fifth, I will address the 

trademark infringement claims and related claims (Counts VII

through XII, and part of Count IV). 

FIRST (as to Counts III through VI, and XIII):

Plaintiff’s Evidence Fails to Show Any Breach of

Contract, or Breach of Fiduciary Duty, or Conversion,

or Unjust Enrichment.

The testimony of Plaintiff’s president, Ms. McAlear, does

not contradict the declarations of Childcraft: the relationship

between Plaintiff and Childcraft was an ordinary, run-of-themill, arms’ length agreement for the purchase of goods. The

parties did not have a “special” relationship. Childcraft

undertook no extraordinary obligations to safeguard Plaintiff’s

interests or to act as Plaintiff’s “fiduciary.” 

A. The Relationship between Plaintiff and Childcraft 

 Was Ordinary, Not “Special” or “Fiduciary.”

The Seat Sack was just one of thousands of products that

appear in Childcraft’s catalogs. (Doc. #53, Suchodolski Decl.

¶6.) And Plaintiff was one of hundreds of vendors who sold

products through those catalogs. (Id.) Nevertheless, Plaintiff

argues that its relationship with Childcraft was “special,” and

even “fiduciary.” But Plaintiff’s evidence does not support that

argument.

In Doc. #60, Ms. McAlear’s 2/12/09 affidavit, at ¶7, she

says: “I was told in numerous discussions by Liz Scott and Lois

Plotkin, Childcraft’s representatives, that Childcraft would act
-14-

as Seat Sack, Inc.’s distributing agent and that Childcraft would

use its best efforts to sell ‘Seat Sacks’ ....” For purposes of

ruling on summary judgment, I assume that Childcraft made such

statements. But such statements occurred in the undisputed

context that Childcraft was purchasing for its own inventory, and

was free to charge its customers whatever retail price it chose.

B. Contrary to Count V, Childcraft

 Did Not Breach Any Contract with Plaintiff.

The periodic purchase orders and invoices obligated

Childcraft to pay Plaintiff for the Seat Sacks, and there is no

claim that Childcraft breached that obligation. The 2/12/09

affidavit of Ms. McAlear submits Exhibit J, a one-page Childcraft

form entitled “2003 Vendor Profile.” Its third line said: 

“Vendor partnership agreement for calendar year 2003. The

completion of this agreement will factor into all new product

decisions.” Despite that one use of the word “partnership,” the

document did not create any partnership in the legal sense of

sharing risks and liabilities. To the extent that it was a

contractual agreement, the document imposed obligations on

Plaintiff as Vendor. For example, the document asked “Do you

sell directly to schools?” and Plaintiff answered “No”; the

document asked “Do you have a current Certificate of Insurance?”

and Plaintiff answered “Yes.”

Plaintiff does not specify any contractual obligation that

was breached by Childcraft or its parent company. The defendants

are entitled to summary judgment on Count V of the Complaint. 

C. Contrary to Counts IV and VI, Childcraft Did Not 

 Undertake or Breach a Fiduciary Duty to Plaintiff.

Count IV’s heading alleges “Deceptive Trade, Unfair Business

Practices, Misappropriation of Trade Secrets, and Unfair

Competition.” Count IV accuses the defendants of “gross malice”

and “deceptive trade and practices while acting as plaintiff’s

distributor and fiduciary.” (Compl. at ¶35.) Count VI’s heading

seeks attorneys fees and costs. It accuses the defendants of

“fraudulent actions ... while acting as a fiduciary and in breach

of that duty to the plaintiff[.]” (Compl. at ¶42.)

In Pan Am. Corp. v. Delta Air Lines, Inc., 175 B.R. 438,

511-12 and n.64 (S.D.N.Y. 1994), Judge Patterson wrote:

.... [W]hen “parties deal at arms length in a 

commercial transaction, no relation of confidence 

or trust sufficient to find the existence of a 
-15-

fiduciary relationship will arise absent extraordinary circumstances.” [citations omitted] An

ordinary contract is generally insufficient to 

give rise to a special relationship. [citation 

omitted]

.... Knowledge of a party’s financial position

is inadequate as a matter of law to create a 

fiduciary relationship. Rather, some form of 

control over or entrustment of a party’s finances

is necessary. See Chipman v. Steinberg, 106 A.D.2d

343, 345, 483 N.Y.S.2d 256, 258 (1st Dep’t 1984)

(to create a fiduciary relationship, one party must

entrust its money, property or services with another),

aff’d, 65 N.Y.2d 842, 493 N.Y.S.2d 129 (1985).

Judge Patterson’s opinion was recently quoted with approval in

DeBlasio v. Merrill Lynch & Co., Inc., 2009 WL 2242605, *28

(S.D.N.Y. July 27, 2009) (Sullivan, J.)

Plaintiff has the burden to show the existence of a

fiduciary relationship. Ms. McAlear’s own testimony, which I

have quoted extensively, shows that the relationship between

Plaintiff and Childcraft was an ordinary, arms length

relationship between a vendor and a distributor. Plaintiff sold

thousands of Seat Sacks to Childcraft, which paid the invoices in

full. There was no entrustment. 

The defendants are entitled to summary judgment on Counts IV

and VI of the Complaint.

D. Contrary to Count III, Childcraft

 Did Not Commit Any Conversion.

Count III is a claim for conversion. It alleges: “That the

defendants have converted monies and the proceeds of sales due

plaintiff ... and ... defendants have taken possession ... [of]

proceeds from the sale of plaintiff’s product and/or by sale of a

‘knock-off product’ monies due plaintiff ....” (Compl. at ¶

33.) 

The Seat Sack product was manufactured by Plaintiff.

Plaintiff concedes that Childcraft paid all invoices for its

purchases, and that Plaintiff had no right to any portion of

Childcraft’s retail sales. (McAlear Depo. at Tr. 88-89, 98-99.)

The Seat Pocket product was never manufactured or possessed

by Plaintiff. Count III seeks the proceeds of Childcraft’s sales
-16-

of Seat Pockets. 

The New York law on a claim for conversion is set forth in

Peters Griffin Woodward, Inc. v. WCSC, Inc., 88 A.D.2d 883, 883-

84, 452 N.Y.S.2d 599, 600 (lst Dep’t 1982):

Conversion is an unauthorized assumption and

exercise of the right of ownership of goods belonging

to another to the exclusion of the owner’s rights.

[Citation omitted] Money, if specifically identifiable,

may be the subject of a conversion action. [Citations 

omitted] However, an action for conversion cannot be

validly maintained where damages are merely being sought

for breach of contract (10 N.Y.Jur., Conversion, §27).

The plaintiff has never had ownership, possession

or control of the money constituting the June 

commissions. Therefore, no action in conversion may

be brought ....

Peters Griffin Woodward was discussed in Fantozzi v. Axsys

Technologies, Inc., 2008 WL 4866054, *9 (S.D.N.Y. Nov. 6, 2008),

where Judge McKenna granted summary judgment, dismissed a claim

for conversion, and wrote: “New York law is clear, seeking to

enforce an ‘obligation to pay’ does not raise a claim for

conversion.”

The defendants are entitled to summary judgment on Count III

of the Complaint.

E. Contrary to Count XIII, There Can Be

 No “Unjust Enrichment” in the Face of a Contract.

Count XIII asserts a claim for unjust enrichment. But

Plaintiff and Childcraft were parties to the 1/28/2000 Agreement,

as well as to purchase orders and invoices (all of which were

paid). 

The high court of New York has explained the New York law on

unjust enrichment as follows:

A “quasi-contract” only applies in the 

absence of an express agreement, and is not 

really a contract at all, but rather a legal 

obligation imposed in order to prevent a party’s 

unjust enrichment [citations omitted]. Indeed, 

we have stated that: “.... Briefly stated, a 

quasi-contractual obligation is one imposed by law 
-17-

where there has been no agreement or expression 

of assent, by word or act, on the part of either 

party involved. ....” [citation omitted].

Clark-Fitzpatrick, Inc. v. Long Island R.R. Co., 70 N.Y.2d 382,

388-89, 521 N.Y.S.2d 653, 656 (N.Y. Ct. App. 1987) (emphasis

added by the Clark opinion).

Here, it is undisputed that the parties had a contractual

relationship. Plaintiff has not come forward with evidence that

would allow a reasonable jury to conclude that the Defendants

were somehow “enriched” by receiving a benefit or thing of value

from Plaintiff that falls outside the subject matter of the

parties’ contract. Accordingly, the Defendants are entitled to

summary judgment on Count XIII of the Complaint.

SECOND (as to Counts I and II):

Plaintiff’s Evidence Fails to Show Fraud.

In Schlaifer Nance & Co. v. Estate of Andy Warhol, 119 F.3d

91, 98 (2d Cir. 1997), the Second Circuit wrote:

Under New York law, for a plaintiff to prevail

on a claim of fraud, he must prove five elements by

clear and convincing evidence: (1) a material

misrepresentation or omission of fact, (2) made with

knowledge of its falsity, (3) with an intent to defraud,

and (4) reasonable reliance on the part of plaintiff,

(5) that causes damage to the plaintiff.

***

.... “Where sophisticated businessmen engaged

in major transactions enjoy access to critical 

information but fail to take advantage of that access,

New York courts are particularly disinclined to 

entertain claims of justifiable reliance.” [Citation

omitted]

In considering whether Plaintiff “justifiably relied” upon an

alleged statement, a jury would consider the context, including

Ms. McAlear’s testimony that she previously owned an infant

bedding company with 38 employees and had previously dealt with a

major national distributor.

Counts I and II allege fraud in the inducement and fraud. 

Paragraph 12 alleges, in part: “On, about or during the month of

November, 1999, plaintiff, as a result of fraudulent
-18-

misrepresentations made by defendants, ... did enter into an

agreement with the defendants, whereby plaintiff agreed to allow

the defendants to act as its distributor for present and future

sales of plaintiff’s aforesaid ‘Seat Sack,’ ....” Paragraph 13

alleges: “Upon information and belief, on, about, or immediately

proceeding [sic] the making of the aforesaid agreement,” the

Childcraft Defendants made false statements to Plaintiff. 

(Compl. ¶ 13.) 

The Complaint, which was originally filed in New York state

court, did not allege fraud with the particularity required by

Rule 9(b) of the Federal Rules of Civil Procedure. It said that

“defendants, through its/their agents and/or employees,” made

statements that:

A. The defendants would at all times act as

plaintiff’s fiduciary and distributor and would protect

and promote the best interests of plaintiff 

 and its aforesaid product; ....; and

B. ... all of the plaintiff’s existing and future

customers would be serviced in the same manner and at

the same rates and prices; .... that defendants would

not compete in [with?] the manufacture and/or

distribution of said product or any likeness thereof,

.... and that the defendants would at all times protect

the integrity and solvency of the plaintiff’s product

and business; and 

C. That the defendants would not act in any manner

contrary to its fiduciary capacity as a distributing

agent for the plaintiff’s product; and

D. That plaintiff’s business and/or its products

protected by a registered patent and/or trademark

and/or its mark would be accurately promoted and

protected in the general market for the benefit of the

plaintiff.

(Compl. ¶13 at Sub-Paragraphs (A)-(D).)

Instead of requiring an amended complaint, I directed Ms.

McAlear to appear for deposition, and I warned her: “She must be

prepared to state the full particulars of plaintiff’s fraud

claims; she must (1) specify each statement that plaintiff

contends w[as] fraudulent, (2) identify the speaker of each

statement, and identify each other person who was present or

received the statement, (3) state when and where each statement
-19-

was made, and (4) explain why each statement was fraudulent." 

(2/14/08 Memorandum and Order.) 

At deposition, Ms. McAlear was asked to describe all

statements made by the Defendants on the topics set forth in

Paragraph 13 of the Complaint. I have already quoted much of

that testimony. She did not testify that Childcraft made the

statements alleged in Sub-Paragraphs 13(B) or 13(C). See

particularly McAlear Depo. Tr. 53, 58, 60-61, 70-71, and 87-89.

As for the statement alleged in Sub-Paragraph 13(D), a jury

could find that Childcraft was aware of Ms. McAlear’s design

patent and of Plaintiff’s application seeking to register “Seat

Sack” as a trademark, but Ms. McAlear did not testify that

Childcraft stated that the design patent or the mark “would be

accurately promoted and protected.” If the law allows Plaintiff

to exclude others from using its product’s design, or from using

words similar to its name “Seat Sack,” then the remedy would lie

under Counts VII through XII, which I will discuss later. 

As for the statement alleged in Sub-Paragraph 13(A), Ms.

McAlear did not testify that Childcraft used the word

“fiduciary.” She did testify that Ms. Scott said “that they

would do their best to sell my product.” (McAlear Depo. Tr. 67.) 

However, under New York law, “a cause of action for fraud will

not arise if the alleged fraud merely relates to a breach of a

contract,” and there “has been no breach of a duty owed to

plaintiff apart from that arising under the contract.” MBW

Advertising Network, Inc. v. Century Business Credit Corp., 173

A.D.2d 306, 569 N.Y.S.2d 682 (1st Dep’t 1991). “A cause of

action for fraud in inducing a contract cannot be based solely

upon a failure to perform contractual promises of future acts.” 

C.B. Western Financial Corp. v. Computer Consoles, Inc., 122

A.D.2d 10, 504 N.Y.S.2d 179, 182 (2d Dep’t 1986). 

For all the reasons stated above, the defendants are

entitled to summary judgment on Counts I and II. 

THIRD (as to part of Count IV):

Plaintiff’s Evidence Fails to Show

Misappropriation of Trade Secrets.

Part of Count IV (namely its heading) tersely alleges

misappropriation of trade secrets. The Complaint itself sheds no

light on what “trade secrets” allegedly were misappropriated or

how the misappropriation was accomplished. At deposition, Ms.

McAlear was asked “What trade secrets?” She replied: “My design,

my patent, the people that we were selling it to that I had them
-20-

go directly to Childcraft.” (McAlear Depo. Tr. 100.) None of

those items are trade secrets.

 

In order to prove misappropriation of trade secrets,

Plaintiff must show the misappropriation of information that is

secret. Lehman v. Dow, Jones & Co., Inc., 783 F.2d 285, 298 (2d

Cir. 1986). The Seat Sack design was not a trade secret, as

“secrecy is necessarily lost when the design or product is placed

on the market.” Linkco, Inc. v. Fujitsu, Ltd., 230 F.Supp.2d

492, 498 (S.D.N.Y. 2002). Plaintiff admits that anyone holding a

Seat Sack can see its design. (McAlear Depo. at Tr. 101.) 

Similarly, the ‘731 Patent is a public record available for the

world to see, as Ms. McAlear again admits. (Id. at Tr. 103.) 

Childcraft did not misappropriate the names and addresses of

Plaintiff’s customers; Plaintiff supplied that information to

Childcraft, and Plaintiff inserted the inside labels that allowed

those customers to reorder directly from Childcraft. Ms. McAlear

answered “no” when asked: “Are you aware of any instances in

which Childcraft sold a product bearing the Seat Sack name

without the permission of Seat Sack, Inc.?” (Id. at Tr. 105.) 

By Plaintiff’s own testimony, Childcraft did not

misappropriate any trade secrets from Plaintiff. Accordingly,

the defendants are entitled to summary judgment on the part of

Count IV that alleges misappropriation of trade secrets.

FOURTH (as to parts of Counts VII and VIII):

Plaintiff’s Evidence Fails to Show

Design Patent Infringement.

 

Count VII’s heading alleges “unlawful use of Plaintiff’s

patented product,” and Count VIII alleges “federally registered

patent.” The defendants’ 1/27/09 memorandum, at pages 35-38,

correctly read these terse portions of Counts VII and VIII to

allege a claim for infringement of the design patent issued to

Ms. McAlear in 1995. A copy of the design patent was annexed as

Exh. B to Ms. McAlear’s 3/21/07 affidavit (refiled in our Court

on 7/24/07), and annexed again as Exh. A to her 2/12/09

affidavit. The design patent’s claim is for “The ornamental

design for sack hanging on the back of a chair, as shown.” It

contains six drawings, which show a very simple, unornamented,

functional design.

Defendants’ 1/27/09 memorandum, at pages 36-37, said: “To

qualify for design patent protection, a design must have an

ornamental appearance that is not dictated by function alone. 

Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141,

148 (1989). .... Design patents are narrow in scope in that
-21-

they are strictly limited to what is shown in the drawings and

only protect the novel, ornamental aspects of the design as shown

in the patent. Metrokane, Inc. v. Wine Enthusiast, 185 F.Supp.2d

321, 326 (S.D.N.Y. 2002) .... (granting summary judgment to

accused infringer where design patent drawings did not disclose

any ornamental aspects of patented device).” 

In Metrokane, at page 327, Judge Conner did indeed grant

summary judgment on the first of two design patents, for the

simple reason that “this design has no purely ornamental features

that merit patent protection.” The same is true of Ms. McAlear’s

design patent. It contains six drawings, which show a very

simple, unornamented, functional design. 

The defendants’ memorandum presented two additional

arguments for summary judgment as to design patent infringement. 

A threshold argument was: Ms. McAlear had presented no evidence

that she had assigned or licensed the design patent to Plaintiff

(the corporation that she formed in 1999). Even if that defect

could be cured, and even if the design merited some protection,

the final argument was: Childcraft’s Seat Pocket contains two

extra pockets, as well as a name tag holder, and thus Plaintiff

cannot meet “its burden of proving [that] the two designs would

appear ‘substantially the same’ to the ordinary observer.” 

(1/27/09 Memo., pp. 37-38, quoting Egyptian Goddess, Inc. v.

Swisa, Inc., 543 F.3d 665, 678 (Fed. Cir. 2008) (en banc,

affirming summary judgment), cert. denied, 129 S.Ct. 1917

(2009).)

As to the threshold argument, Ms. McAlear’s 2/12/09

affidavit at ¶3 says, “I have always authorized and assigned unto

Seat Sack, Inc. the right to utilize this patent ....” However,

defendants’ reply memorandum at page 19 cites 35 U.S.C. §261

(assignment of a patent must be in writing to be effective) and

Bellehumeur v. Bonnet, 127 Fed. Appx. 480, 484-85 (Fed. Cir.

2005) (party claiming oral assignment lacked standing to maintain

infringement action).

Most importantly, Plaintiff has utterly failed to show that

her design patent contains “novel, ornamental aspects,” or that

Childcraft’s design appears to be “substantially the same.” 

Accordingly, the defendants are entitled to summary judgment

on those parts of Counts VII and VIII that claim infringement of

the design patent.

 
-22-

FIFTH (as to Counts VIII through XII, and parts of IV and VII):

Plaintiff’s Evidence Fails to Show Trademark

Infringement, Dilution, or Unfair Competition.

 

Various counts of the Complaint allege that confusion and/or

dilution has been caused by the trade name and trade dress of

Childcraft’s Seat Pocket, which competes with Plaintiff’s Seat

Sack. Count VIII invokes 15 U.S.C. §1114, which protects a

“registered mark” against infringement. Counts IX and X both

invoke 15 U.S.C. §1125(a), which is the federal statute that

protects against infringement of an unregistered trademark and

against unfair competition. Counts XI and XII invoke N.Y.

General Business Law §360-l, which provides for injunctive relief

if a plaintiff proves “[l]ikelihood ... of dilution of the

distinctive quality of a mark or trade name.” Count IV, as part

of a claim of breach of fiduciary duty, mentioned “deceptive

trade, unfair business practices, ... and unfair competition,”

and Plaintiff’s 2/12/09 Memorandum, at pages 13-14, makes clear

that Count IV was intended to invoke N.Y. General Business Law

§349. Count VII’s heading mentions only the “patented product;” 

the text of Count VII also contains allegations about the

product’s alleged trademark, but those allegations add nothing to

what is already contained in Count IV and Counts VIII through

XII.

A. Count IV and New York General Business Law §349

As I just noted, Plaintiff’s 2/12/09 Memorandum, at pages

13-14, makes clear that Count IV was intended to invoke N.Y.

General Business Law §349. However, Judge Scheindlin has

written:

Section 349 prohibits “deceptive acts and 

practices” and Section 350 proscribes false advertising

in commerce. A successful claim under either statute

must prove “consumer injury or harm to the public

interest.” Securitron Magnalock Corp. v. Schnabolk,

65 F.3d 256, 264 (2d Cir. 1995). To demonstrate such

harm, a practice must be the “sort of offense to the 

public interest that would trigger FTC intervention

under 15 U.S.C.A. §45.” Horn’s, Inc. v. Sanofi 

Beaute, Inc., 963 F.Supp. 318, 328 (S.D.N.Y. 1997) 

(quoting R. Givens, Practice Commentaries on N.Y.

Gen. Bus. Law §349, at 567-68 (McKinney 1988)). ....

.... Harm to a business from a competitor, 

however, does not constitute the kind of detriment

to the public interest required by the statutes. See
-23-

Fashion Boutique of Short Hills, Inc. v. Fendi USA, 

Inc., No. 91 Civ. 4544, 1992 WL 170559 at *4 (S.D.N.Y.

July 2, 1992) (dismissing Section 349 claim because

alleged harm to plaintiff’s business outweighed any

incidental harm to the public).

Savin Corp. v. The Savin Group, 2003 WL 22451731, *15-16

(S.D.N.Y. Oct. 24, 2003). In the case at bar, just as in Judge

Scheindlin’s case, plaintiff has failed to produce evidence of

harm to the public outweighing the alleged harm to plaintiff’s

business, and therefore the defendants are entitled to summary

judgment on the portion of Count IV that invokes General Business

Law §349. 

B. Count VIII and 15 U.S.C. § 1114

Count VIII invokes 15 U.S.C. § 1114, which protects a

“registered mark” against infringement. The U.S. Patent and

Trademark Office has not granted Plaintiff a registration of

“Seat Sack” as a trademark. As I noted earlier, Plaintiff

applied to register the word mark “Seat Sack” as a trademark on

May 15, 2000 but abandoned the application on February 5, 2002;

it applied again on August 18, 2006, but registration has not

been granted. 

Plaintiff does not have a registered trademark for “SEAT

SACK.” (Schmidt Decl. ¶ 2, Ex. A.) Accordingly, the defendants

are entitled to summary judgment on Count VIII.

C. Counts IX and X and 15 U.S.C. §1125(a)(1)

Subsection “A” of 15 U.S.C. §1125(a)(1) prohibits the “use

in commerce [of] any word, term, name, symbol, or device, or any

combination thereof, or any false designation of origin” which is

“likely to cause confusion . . . as to the affiliation,

connection, or association” of the user with another person, “or

as to the origin, sponsorship, or approval of his or her goods,

services, or commercial activities by another person[.]” 15

U.S.C. §1125(a)(1)(A). Subsection “B” of 15 U.S.C. §1125(a)(1)

can impose civil liability on any person who “misrepresents the

nature, characteristics, qualities, or geographic origin of his

or her or another person’s goods.” 15 U.S.C. §1125(a)(1)(B). 

Together, these provisions encompass a wide range of activities

that include common-law trademark infringement (i.e.,

infringement of unregistered marks), trade dress infringement,

and unfair competition (“passing off” one’s own product as that

of another, false advertising, disparagement of a competitor’s

product, and so on).
-24-

Counts IX and X are primarily addressed to subsection “A,”,

namely 15 U.S.C. §1125(a)(1)(A). Defendants’ 1/27/09 memorandum,

at pages 25-33, correctly warned Plaintiff that it would have to

submit admissible evidence showing (1) that Plaintiff has a

protectible trademark or trade dress, and (2) that there is a

likelihood of consumer confusion between the Seat Sack and the

Seat Pocket.

1. Plaintiff’s evidence fails to show a

protectible trademark or trade dress.

To prevail under 15 U.S.C. §1125(a)(1)(A), Plaintiff’s first

task is to show either (a) that its trademark or trade dress is

“inherently distinctive,” or (b) that its trademark or trade

dress has acquired “secondary meaning,” i.e., “that, in the minds

of the public, the primary significance” of the trademark or

trade dress “is to identify the source of the product rather than

the product itself.” Two Pesos, Inc. v. Taco Cabana, Inc., 505

U.S. 763, 767 n.4, 112 S.Ct. 2753, 2756 n.4 (1992).

In Two Pesos, the Supreme Court wrote: “Marks are often

classified in categories of generally increasing distinctiveness;

following the classic formulation set out by Judge Friendly, they

may be (1) generic; (2) descriptive; (3) suggestive; (4)

arbitrary; or (5) fanciful. .... Marks which are merely

descriptive of a product are not inherently distinctive. When

used to describe a product, they do not inherently identify a

particular source; ....” 505 U.S. at 768-69, 112 S.Ct. at 2757. 

Plaintiff’s mark is merely descriptive. As I mentioned

earlier, Plaintiff chose the name “Seat Sack” because the product

is a sack that works in conjunction with a seat. Likewise,

Plaintiff chose names for its other products that describe the

function of those products. Thus, Plaintiff sells a “File Drawer

Sack,” and chose the name because the product is a sack that

hangs on a file drawer. Plaintiff also sells a “Locker Sack,”

which it named because the product is a sack that hangs inside a

locker. Plaintiff’s “Office Sack” was so named because it is a

sack that is designed for use in an office or cubicle. The

“Lock-n-Sack” is designed for use in or on a child’s locker, and

Ms. McAlear chose that name because that product “locked and it

was a sack, and ‘Sack’ was my name.” (McAlear Depo. Tr. 126-27.)

Hence, Plaintiff’s mark “Seat Sack” is not “inherently

distinctive.”

Nor is there anything “inherently distinctive” in the

product’s “trade dress” - - in the way that the words “Seat Sack”
-25-

are written on Plaintiff’s product, or in the product’s

packaging, or in “the total visual image by which the product is

presented to consumers.” Jeffrey Milstein, Inc. v. Greger,

Lawlor, Roth, Inc., 58 F.3d 27, 31 (2d Cir. 1995). 

Accordingly, Plaintiff must present admissible evidence that

the words “Seat Sack,” or the product’s trade dress, have

acquired “secondary meaning.” On this topic, the Second Circuit

has written:

“[P]roof of secondary meaning entails vigorous

evidentiary requirements,” .... In determining 

whether a mark has acquired secondary meaning, we 

have examined: advertising expenditures; consumer

studies linking the name to a source; sales success;

unsolicited media coverage of the product; attempts 

to plagiarize the mark; and length and exclusivity 

of the mark. 

Thompson Medical Co. v. Pfizer, Inc., 753 F.2d 208, 217 (2d Cir.

1985) (numerous internal citations omitted). 

Plaintiff has not come forward with such evidence. It has

shown that the sales of the Seat Sack product to consumers rose

from 1999 to 2005, but the evidence strongly indicates that the

most important consumers (teachers) associated the Seat Sack

product with Childcraft more than with Plaintiff. While

testifying about the time period of October 2005, Ms. McAlear

mentioned: “Most people know who Childcraft is. Most teachers

do.” (4/4/08 McAlear Depo. Tr. 152.) Childcraft’s attorney Mr.

Baish promptly asked follow-up questions:

Q: You said Childcraft is well known. Was

Seat Sack an independent source of the products[,]

known at that time?

MR. CARROLL [Plaintiff’s attorney]: Referring 

to the name now, Seat Sack?

MR. BAISH: The company Seat Sack.

A: You mean to sell it directly to teachers?

Q: Yes.

A: Not so much yet, because we hadn’t marketed

that. We marketed it to be sold through Childcraft.
-26-

Q: The reality was that even as of October 2005 

the vast majority of the sales of Seat Sack since

its existence through October 2005 were made through

Childcraft, right?

A: Yes. ....

(4/4/08 McAlear Depo. Tr. 152-53, emphasis added.) Ms. McAlear

chose to use Childcraft as a distributor of the Seat Sack, and to

have many customers reorder through Childcraft, even though her

company was selling directly to other customers, and even though

Childcraft was selling thousands of educational products supplied

by hundreds of vendors. 

In sum, the evidence, even taken in the light most favorable

to Plaintiff, fails to show that Plaintiff’s trademark and/or

trade dress acquired “secondary meaning,” i.e., “that, in the

minds of the public, the primary significance” of Plaintiff’s 

trademark or trade dress was “to identify the source of the

product rather than the product itself.” Two Pesos, 505 U.S.

763, 767 n.4, 112 S.Ct. 2753, 2756 n.4 (1992).

Accordingly, Plaintiff’s evidence fails to show the first

essential element under 15 U.S.C. §1125(a)(1)(A), namely, a

protectible trademark or trade dress. It is not necessary to

discuss the second essential element, namely, whether the

evidence shows a likelihood of consumer confusion between the

Seat Sack and the Seat Pocket.

 

It is unclear whether Counts IX and X intend to invoke

subsection B of 15 U.S.C. §1125(a)(1), which can impose liability

on any person who “misrepresents the nature, characteristics,

qualities, or geographic origin of his or her or another person’s

goods.” 15 U.S.C. § 1125(a)(1)(B). 

Count IX (at ¶62) and Count X (at ¶70) each allege that

Childcraft “misrepresented and falsely described to the general

public the source of origin of the bootleg merchandise,” i.e.,

the Seat Pocket. (Compl. ¶ 70.) I note that the “source of

origin” seems to be referring to word “origin” in 15 U.S.C.

§1125(a)(1)(A). It is not the same as “geographic origin,” which

is the phrase used in 15 U.S.C. §1125(a)(1)(B). In any event,

Plaintiff’s evidence does not show that the defendants

misrepresented the “nature, characteristics, qualities, or

geographic origin” of the Seat Sack or of the Seat Pocket. 

For all the reasons stated above, the defendants are

entitled to summary judgment on Counts IX and X.
-27-
D. Counts XI and XI1 and New York's General Business 

Law 5360-1. 

Counts XI and XI1 invoke New York's General Business Law 

S360-1, which was also mentioned in passing in Counts VII and 

VIII. Gen. Bus. Law 8360-1 (formerly 8368-d) offers protection 

against "dilution of the distinctive quality of a mark or trade 

name." However, the high court of New York held that this 

statute protects "only those trade names which are truly of 

distinctive quality or which have acquired a secondary meaning in 

the mind of the public." Allied Maintenance Corp. v. Allied 

Mechanical Trades, Inc., 42 N.Y.2d 538, 546, 399 N.Y.S.2d 628, 

633 (Ct. App. 1977). The Second Circuit reads the Allied 

decision as indicating that "the anti-dilution statute protects 

only extremely strong marks." Sally Gee, Inc. v. Myra Hogan, 

Inc., 699 F.2d 621, 625 (2d Cir. 1983) . 

For all the reasons discussed above, Plaintiff's evidence 

fails to show that it is the owner of trade name which is "truly 

of distinctive quality" or has "acquired a secondary meaning in 

the mind of the public." Accordingly, the defendants are 

entitled to summary judgment on Counts XI and XII. 

CONCLUSION 

For the reasons set forth in today's Opinion and Order, I 

deny the defendants' motion to strike (Doc. #70), I grant the 

defendants' motion for summary judgment (Doc. #50), and I deny 

Plaintiff's cross-motion for summary judgment (Doc. #59). I am 

today entering a Final Judgment in favor of the defendants. 

United States Magistrate Judge 

500 Pearl Street, Room 1360 

New York, New York 10007 

Telephone: (212) 805-6175 

Fax: (212) 805-6181 fax 

Dated: New York, New York 

January 22, 2010 

Copies of this Opinion and Order are being sent by electronic 

filing and by mail to: 
Edward J. Carroll, 111, Esq. 

Law Office of Edward J. Carroll 

2733 Route 209 

Kingston, NY 12401 

David M. Fine, Esq. 

Orrick, Herrington & Sutcliffe LLP (NYC) 

666 Fifth Avenue 

New York, NY 10103 

Anthony S. Baish, Esq. 

Godfrey & Kahn, S.C. 

780 North Water Street 

Milwaukee, WI 533202-3590