Bad Behavior Lands Sink Manufacturer in Hot Water

Bloomberg BNA’s Patent Trademark & Copyright Law Daily™is the IP industry’s premier news service, offering objective, timely,and reliable daily news coverage and commentary from leading IP law...

By Blake Brittain

July 21 — A kitchen fixture manufacturer accused of trademark infringement and sanctioned for repeated incidents of bad behavior lost all of its appeals before the U.S. Court of Appeals for the Eleventh Circuit July 16.

The manufacturer also breached a settlement agreement multiple times, and generally engaged in behavior that the district court said was “egregious and epitomizing bad faith”— including falsely linking the German plaintiff to Nazi war crimes on the Internet.

The circuit court said that the district court was right to hold the manufacturer in contempt because “Defendant—either personally, through aliases, or by agents—attempted to register prohibited trademarks, registered prohibited domain names, and redirected over twenty domains to a website filled with ‘atrocious' Nazi images and propaganda, among other things.”

“Given the foregoing, the district court was [also] not wrong to direct the Clerk of Court to enter a judgment reflecting the liquidated damages, attorneys’ fees, and costs for which it found Defendants jointly and severally liable,” the circuit court said.

Blanco GmbH & Co., a German manufacturer of sinks, faucets and kitchen accessories, sent a cease-and-desist letter to Vlanco Industries LLC and its president, Vito Antonio Laera, to stop them from selling identical sinks and faucets under the “Vlanco” name.

Vlanco responded by filing multiple new applications with the U.S. Patent and Trademark Office, petitioning to cancel one of Blanco's marks, and registering domain names “containing the infringing designations BLANCO or VLANCO, with the specific intention of diverting consumers from consummating sales of Plaintiff’s goods bearing the BLANCO [m]arks.”

Blanco then sued Vlanco and Laera for trademark infringement in August 2012 in the U.S. District Court for the Southern District of Florida.

The parties settled in April 2013, but Blanco filed to reopen the case and impose sanctions against Vlanco three separate times for bad behavior.

This behavior included filing new applications with the PTO concerning the prohibited marks, filing new suits in South Carolina and Florida to let it use the prohibited marks, and redirecting domain names to a website “featuring Adolf Hitler and atrocious Nazi war crimes, as well as a link to Heinrich Blanc, the founder of Plaintiff, implying his involvement with the[] atrocities.”

The district court found that Vlanco had flaunted the terms the agreement, “besmirching Plaintiff’s business reputation,” and noted its use of “the redirection process solely for nefarious reasons” and “multiple attempts to associate Plaintiff with Nazi war crimes.” The district court fined Vlanco $600,000 and awarded Blanco attorneys' fees and costs.

Vlanco appealed every ruling against it to the Eleventh Circuit, and the circuit court was no more sympathetic.

The circuit court said that Vlanco's briefs on appeal “focuse[d] entirely upon the alleged improprieties” of attorneys and judges involved in the case

“Defendant makes a number of claims about the conduct of certain attorneys, the nub of which is that they represented they served him with documents when they did not actually do so, divulged items he told them in confidence, and made a number of misrepresentations to him and the court” along with “similar assertions about the district court and magistrate judges involved in the case, claiming they failed to serve him various documents, improperly considered statements made by Plaintiff’s counsel, and failed to conduct proceedings with order and decorum.”

The court denied those claims because they had not been raised initially, and affirmed the five orders at issue, the substance of which the court said Vlanco had not addressed.

“Were we to consider the substance of the district court’s orders, though, we would not arrive at a different result,” the court said, because it determined that the district court had not abused its discretion at any point.

Judges Stanley Marcus, William Pryor, and Julie Carnes wrote the opinion per curiam.

Blanco was represented by Jack J. Aiello of Gunster Yoakley & Stewart PA, West Palm Beach, Fla. Laera represented himself pro se.

To contact the reporter on this story: Blake Brittain in Washington at bbrittain@bna.com

To contact the editor responsible for this story: Anandashankar Mazumdar at amazumdar@bna.com