Nev. judge sides with Toyo in trademark case (Update)

By Miles Moore, Senior Washington Reporter

LAS VEGAS (July 7, 2015) — Toyo Tire & Rubber Co. is entitled to the default judgment, permanent injunction and monetary damages it requests in its trademark infringement lawsuit against Chinese tire makers, a magistrate judge in the Nevada federal district court has ruled.

Judge Cam Ferenbach issued his report and recommendation July 3, four days after Toyo filed supplemental information at his request.

Kabusikiki Kaisha Tokyo Hihoon Rubber Corp., a Beijing-based holding company, and its associated business Japan Toyomoto Tire Corp. have been counterfeiting and infringing on Toyo's trademarks since around 2010, Toyo claimed in a lawsuit it filed in November 2014.

When Kabusikiki and Toyomoto failed to reply to Toyo's brief, Toyo petitioned the court asking for default judgment in the case, along with a permanent injunction against the Chinese tire makers and monetary damages from them.

Judge Ferenbach issued an order June 15, asking Toyo for further information. Specifically, the judge sought information on whether his court had both subject-matter jurisdiction over Toyo's action and personal jurisdiction over Kabusikiki and Toyomoto.

Because of Toyomoto's presence at the Specialty Equipment Market Association (SEMA) Show in Las Vegas in November 2014 — at which it exhibited the infringing trademarks and tires bearing those trademarks — the Nevada court unquestionably has jurisdiction in the case, Toyo argued in the supplemental information it filed with the court June 29.

“Nevada's long-arm statute provides for the exercise of personal jurisdiction to the full extent permitted by the United States Constitution,” Toyo said.

Although Toyo is fighting Toyomoto around the world for trademark infringement, the tire maker does not expect the Nevada court to issue a worldwide injunction, only one that applies to the U.S., Toyo said. Therefore, Toyo's request for relief cannot be construed as violating the Lanham Act, the major law covering trademark infringement in the U.S., it said.

Along with the supplemental information, Toyo filed with the court a proposed final default judgment and permanent injunction.

The proposed injunction would bar Kabusikiki and Toyomoto from using the allegedly infringing trademarks in any way in the U.S., or selling or distributing any products bearing the trademarks. It also would award Toyo $300,000 in statutory damages plus post-judgment interest on the principal sum from the date of the order until payment in full.

In his July 3 report, Judge Ferenbach said Toyo met all the court's criteria. The tire maker established that the court has jurisdiction over the case, and also established all the salient facts in its allegations of trademark infringement and “cybersquatting.”

Toyo demonstrated convincingly that Kabusikiki and Toyomoto showed bad-faith intent to profit from Toyo's trademarks, and also that Toyomoto's online domain names are confusingly similar to Toyo's, according to Judge Ferenbach.

“Toyo's complaint plausibly alleges that the Toyo mark is an inherently distinctive arbitrary mark,” he wrote. “The Toyo mark has no intrinsic connection to tires or automotive products. This entitles the mark to a broad scope of protection.”

There is no time frame for the full Nevada district court to rule on Judge Ferenbach's recommendation, according to a Toyo spokeswoman. However, the tire maker fully expects to prevail in this case, she said.

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