United States District Court, D. Arizona
DOUGLAS L. RAYES UNITED STATES DISTRICT JUDGE
This matter was tried before the Court without a jury for four days commencing on October 20, 2015, and concluding on October 23, 2015. Having considered the evidence introduced at trial, the arguments of counsel, and the applicable law, the Court makes the following findings of fact and conclusions of law.
FINDINGS OF FACT
1. Plaintiff Stone Creek, Inc. (“Stone Creek”), an Arizona Corporation, brought this case against Omnia Italian Design, Inc. (“Omnia”) alleging claims of federal and common law trademark infringement and unfair competition.
2. Stone Creek is a company that manufactures and sells furniture in Arizona.
3. Stone Creek has operated solely out of the Phoenix, Arizona area, except for a period from 2004 to 2008, during which it also manufactured and sold furniture in Dallas, Texas.
4. Around 1990, Stone Creek adopted and began using the STONE CREEK mark:
5. The STONE CREEK mark is a “red oval-shape circle around the words ‘Stone Creek.’”
6. In 1992, Stone Creek first obtained state trademark and trade name registrations for the trade name “Stone Creek Furnishings” and the following trademark: “oval encircling the trade name of Stone Creek.”
7. Stone Creek renewed the trade name and trademark certifications in 2006.
8. On February 7, 2012, Stone Creek became the owner of U.S. Registration No. 4, 095, 866 for the word mark STONE CREEK in standard characters, and U.S. Registration No. 4, 096, 079 for the wording STONE CREEK surrounded by a stylized, red oval.
9. Household furniture is typically sold locally to customers living within a drivable radius from the furniture outlet retail store.
10. The size, weight, and costs to ship, as well the customers’ preference to see and sit on the furniture, has created the retail furniture business model; local furniture stores.
11. Stone Creek follows the typical retail furniture store business model, selling its furniture locally in the Phoenix area.
12. Stone Creek delivers furniture locally but does not ship furniture out of state.
13. Stone Creek has a website, but does not sell furniture directly through its website. It does not engage in internet sales.
14. Stone Creek operates five showrooms in the Phoenix, Arizona area.
15. The President and owner of Stone Creek, Ron Jones, has had a goal of expanding Stone Creek, but there are no plans to expand and there have been no acts directed toward expanding after Stone Creek closed its Texas operations.
16. The Bon-Ton Stores, Inc. (“Bon-Ton”) is a large retailer that operates furniture galleries in Illinois, Wisconsin, Pennsylvania, Ohio, and Michigan.
17. Omnia’s products are sold to purchasers living within 200 miles of a Bon-Ton Furniture gallery, which includes portions of Iowa, Indiana, Ohio, Wisconsin, Pennsylvania, Illinois, and Michigan, the Bon Ton trading territory. (the “BTTT”).
18. The parties’ distinct trading territories are separated by over 1000 miles at their closest points and nearly 2000 miles at their furthest.
19. From 1993 through 1998, Stone Creek advertised its brand in the monthly Southwest Airlines Spirit magazine and America West’s in-flight magazine (“airline magazines”).
20. These airlines travelled in Arizona, as well as throughout the BTTT.
21. In 1998, Stone Creek began advertising in Phoenix Magazine and Phoenix Home and Garden Magazine (“Phoenix magazines”).
22. Neither the airline magazines nor the Phoenix magazines had or have a significant presence in any of the BTTT states and none of them created awareness of Stone Creek in the BTTT.
23. Stone Creek’s marketing channels existed only within the State of Arizona during the relevant time period.
24. Stone Creek did not target advertising or marketing at the BTTT during the relevant time period.
25. Stone Creek placed its mark on its website, stonecreekfurniture.com, as early as 2000.
26. Stone Creek hired Netwirks to increase its brand exposure through search engine optimization.
27. Netwirks has been successful at establishing the STONE CREEK mark.
28. Consumers can access Stone Creek’s website by going to stonecreekfurniture.com or by searching for “stone creek” and “leather, ” “furniture” or “sofa.” 29. The website has not created awareness of Stone Creek in the BTTT.
30. The vast majority of Google searches for Stone Creek Furniture originate in Arizona.
31. The number of Google searches for the Stone Creek website from the BTTT is negligible.
32. Consumers in the BTTT are not aware of Stone Creek Furniture.
33. There are many businesses within the BTTT that operate under the name of Stone Creek. These ...