Court Opinion

ID: 9479154
Source: CourtListenerOpinion
Date Created: 2023-08-05 07:09:56.486596+00
Date Added: 2024-06-11T17:46:51.581110
License: Public Domain

WILL, Senior District Judge,
concurring.
While I concur in the majority’s conclusions that the award of damages on the defendants’ counterclaim be set aside, that the counterclaim be dismissed and that the case be remanded for a new trial, I find myself in disagreement both with some of their factual determinations and with their sharp criticism of Judge Sharp’s decision. Since both may impact the retrial of the case, I feel impelled to explain my reasons.
First, the majority asserts that G.E.’s loss was “roughly $25,000.” Speicher’s total sales price for the approximately 6,500 units in question was $25,000 on which he had a profit of $1,500. G.E.’s loss was at most the profit it would have realized on the approximately 6,500 units had it sold them to Chrysler. A G.E. employee, Luciano Navocco, testified at trial that G.E. would have made $25,000 above cost on the parts, but it is not clear from the testimony that this amount is equivalent to profit or whether some portion of G.E.’s overhead should be subtracted from it. Moreover, it is by no means certain that Chrysler would have purchased the G.E. inserts at the price quoted or at all, since it had already turned them down at the price quoted T & A by G.E.
Second, the majority places the entire blame for the infringement here on Speicher, ignoring almost entirely the evidence that T & A was the principal instigator as well as the principal beneficiary of the episode. It was T & A who was interested in selling G.E. inserts to Chrysler and obtained a quotation from G.E. When Chrysler turned down T & A’s bid based on that quotation, T & A contacted Speicher who quoted a much lower price for his inserts than G.E. but one on which T & A’s commission or profit was double what it would have been on the G.E. inserts.
It is undisputed that T & A knew Speicher was a small fabricator of cutting inserts and not a dealer in G.E. parts. In addition, given the substantial difference in price between the G.E. and Speicher quotes, there is no way T & A could have believed Speicher was going to supply genuine G.E. parts. It was also T & A which went back to Chrysler with the Speicher price and obtained the order for 6,500 units based on that price. Moreover, Carol Jean Betz, a *539former T & A employee, testified at trial that T & A provided Speicher with G.E. boxes, the boxes which Speicher testified he used to package his inserts. Ned Ellis, the General Manager of T & A, testified that there came a time when T & A asked Speicher to etch the code number “570” on each insert.
As this testimony shows, the evidence that T & A inspired or connived in the infringement did not come entirely from Mr. Speicher, as the majority indicates. Mr. Speicher’s testimony was corroborated by T & A present and former employees and is consistent with the circumstantial evidence that T & A made higher profits on the sale of Speicher parts than on G.E. parts. The majority finds Speicher’s testimony regarding his belief that he was authorized to make and package 570s “exceedingly implausible.” Obviously, I do not. I agree, however, that Speicher was nevertheless an infringer though probably not a “wilful” one which is relevant to the questions both of damages and attorney’s fees.
The majority also lays great emphasis on the uncontested fact that Speicher’s inserts were inferior to G.E.’s and asserts that he “had to know” this would cause trouble for Chrysler. While it is clear that Speicher’s inserts as used by Chrysler did not perform as long as the G.E. inserts, the record does not support the conclusion, although it may be true, that Speicher knew how they were to be used and that they would not last as long or that Chrysler, given their substantially cheaper price, would nevertheless object.
All of these facts as well as other evidence as to T & A’s role in the episode must, I believe, be considered on a retrial before the proper measure of damages can be determined and I trust the trier of fact will not conclude that this court has already foreclosed consideration of any of them.
The majority suggests that it is “baffled” by much of Judge Sharp’s opinion. ■While his ultimate decision was, I agree, erroneous, I am not baffled by it. Section 35(a) of the trademark statute provides, as the majority recognizes, that “subject to the principles of equity” the owner of a trademark which has been infringed is entitled to certain damages. Judge Sharp, in applying equitable principles, ignored the facts that Speicher should, under all the circumstances, have know that his inserts were being passed off to Chrysler as G.E. 570 inserts and that Speicher apparently told a Chrysler representative he was supplying genuine G.E. parts. On the other hand, there was considerable evidence that T & A was the key player in the infringement and its principal beneficiary. It received $2.00 per Speicher insert. Speicher’s profit was less than 25 cents per insert. T & A brought Speicher into the transaction. In spite of its testimony to the contrary, T & A must have suspected that Speicher could not have supplied genuine G.E. parts at the quoted prices. Moreover, the evidence at trial showed that T & A asked him to etch “570” on each insert, and furnished him with the G.E. boxes.
What really baffles me, and I trust on retrial will be explored, is why T & A is not a party here. There are, of course, a number of possibilities. T & A may be bankrupt. It may have settled separately with G.E. or may not have been pursued either by G.E. or Speicher for business or other reasons. In any event, T & A’s role is relevant to the nature of Speicher’s infringement and the damages which should be assessed.
Accordingly, I agree the case should be reversed and remanded for a new trial but with no predetermination as to the facts or condemnation of Judge Sharp.