Court Opinion

ID: 34077
Source: CourtListenerOpinion
Date Created: 2010-04-25 19:12:20+00
Date Added: 2024-06-11T16:54:54.987280
License: Public Domain

United States Court of Appeals
                                                                          Fifth Circuit
                                                                       F I L E D
                     UNITED STATES COURT OF APPEALS                    January 30, 2004
                          FOR THE FIFTH CIRCUIT
                                                                    Charles R. Fulbruge III
                                                                            Clerk

                                    03-20368

                          RADIATOR SPECIALTY COMPANY,

                                                         Plaintiff-Appellant,

                                     VERSUS

   PENNZOIL-QUAKER STATE COMPANY, formerly known as Pennzoil
Products Company; PANDORA MANUFACATURING INC., formerly known as
                       Snap Products Inc.

                                                        Defendants-Appellees.

              Appeal from the United States District Court
                   For the Southern District of Texas
                              (01-CV-2205)

Before DUHÉ, BARKSDALE, and DENNIS, Circuit Judges.

PER CURIAM:1

      Plaintiff Radiator Speciality Co. sued makers of “Fix-a-Flat”

under   the    Lanham      Act,   alleging     that    false   advertising      of

Defendants’ product as non-explosive and safe injured Plaintiff in

marketing     its   own    “Puncture   Seal”    tire    inflator,    which     was

allegedly truly safe but more expensive. The only issues on appeal

concern the district court’s holding on summary judgment that

Radiator’s claim of false advertisement is barred by the equitable

doctrine of laches.          The court found the facts undisputed that

  1
     Pursuant to 5TH CIR. R. 47.5, the Court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
seven years elapsed between the time Radiator first objected to the

use of the “non-explosive formula” label on the “DME” version of

Fix-a-Flat and the date Radiator filed this suit.              On motions for

summary judgment by defendants, Pandora Manufacturing, Inc. and its

alleged successor-in-interest, Pennzoil-Quaker State Company, the

district court dismissed based on laches.            We affirm.

                                    I.

     Laches is an inexcusable delay on the part of the plaintiff

that results in prejudice to the defendant.           Conan Props., Inc. v.

Conan’s Pizza, Inc., 752 F.2d 145, 153 (5th Cir. 1985).                To the

extent that the relevant facts are undisputed, a district court

“enjoys considerable discretion in deciding whether to apply the

doctrine of laches.”   National Ass'n of Gov. Employees v. City Pub.

Serv. Bd., 40 F.3d 698, 707 (5th Cir. 1994).           When a district court

is making an equity determination such as laches, the scope of its

powers “is broad, for breadth and flexibility are inherent in

equitable remedies.”    Swann v. Charlotte-Mecklenburg Bd. of Educ.,

402 U.S. 1, 15, 91 S. Ct. 1267, 1276 (1971).              Unless the district

court   resolved   disputed   issues     of    material    fact   against    the

nonmovant, “its determination of whether the undisputed facts

warrant   an   application    of   laches      is   reviewed   for   abuse    of

discretion.”    National Ass'n, 40 F.3d at 707.

                                    II.

     Plaintiff asserts four errors.           First, Radiator contends that

the district court ignored its evidence of Pandora’s and Pennzoil’s

“unclean hands,” which should have precluded them from invoking an

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equitable    defense.     The   district     court   determined     that   the

undisputed facts did not demonstrate any “willful, egregious, or

unconscionable conduct or bad faith” on the part of Defendants, as

discussed in Hot Wax,2 so as to constitute unclean hands.            We agree

with that assessment.     Nor do we find any abuse of discretion in

the court’s requirement, in accordance with Hot Wax, that the

inequitable conduct alleged relate to the equitable issue in the

case, i.e., the defense of laches.          (On the main demand, Radiator

is asking for damages, not equitable relief.)           We agree that the

record demonstrates no genuine issue of material fact on the

question of Defendants’ “unclean hands” and find no abuse of

discretion in the district court’s ruling in this regard.

      Radiator’s second assignment of error is that the district

court improperly calculated the length of delay for Pennzoil, which

purchased    the   Fix-A-Flat   line   in   November   1997,   by   allowing

Pennzoil to “tack” onto the delay by Radiator in raising its claim

against the preceding owner of Fix-A-Flat.           The court considered

the rationale behind patent and trademark jurisprudence allowing

“tacking.”    If a sale involves an entire product line along with

the goodwill, then “the transferee effectively has assumed the

transferor’s identity,”3 and both the defendant and its predecessor

  2
     Hot Wax, Inc., v. Turtle Wax, Inc., 191 F.3d 813, 826 (7th
Cir. 1999).
  3
     R2 Medical Systems, Inc. v. Katecho, Inc., 931 F. Supp. 1397,
1412 (N.D. Ill. 1996).

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have been “lulled into security by plaintiff’s failure to sue.”4

Because     under    the   undisputed    terms    of     Pennzoil’s   acquisition

document the goodwill was transferred with the entire product line,

the court reasoned that Pennzoil similarly effectively assumed the

transferor’s identity for purposes of laches.                  We discern no abuse

of discretion or error of law in the district court’s careful

analysis.

      Radiator’s third and fourth assigned errors are that the

district court inappropriately resolved factual differences against

Radiator on the issues of unjustifiable delay and prejudice.                      We

conclude from our review of the record, however, that the material

facts are not genuinely disputed.                 The court did not reject

factually any of the reasons Plaintiff offered for the delay.                     We

hold that its analysis and conclusions about the insufficiency of

those reasons are well within its discretion.

      The    court    found   material        evidence    of    prejudice    to    be

uncontradicted as well, and we agree.             Although the court noted a

conflicting     affidavit     on   the       availability      of   “many   of    the

witnesses,” the court found no question of fact regarding the

unavailability of documents or economic harm.                   The court neither

improperly resolved any material fact nor abused its discretion in

finding prejudice.

                                        III.

      Laches “is not determined by a simple rule of thumb,” but by

  4
     Celastic Corp. v. McClellan Shoe Specialty Co., 15 F. Supp.
1048, 1050 (D.C. Del. 1936).

                                         4
“a close scrutiny of the particular facts and a balancing of the

respective interests and equities of the parties, as well as the

general public.”   5 J. Thomas McCarthy, Trademarks and Unfair

Competition, § 31:22 (4th ed. 2003).   The district court provided

a thorough opinion, making its determination to apply laches to

undisputed facts in precisely that manner.   It did not abuse its

discretion in so doing.

     AFFIRMED.

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