Abnormal Use » Kentucky

Sixth Circuit Prefers A Bourbon On The Porch To A Margarita On The Beach

Ammon Lesher — Wed, 30 May 2012 11:30:25 +0000

“All bourbon is whiskey, but not all whiskey is bourbon.” So begins an especially amusing opinion in which the the Sixth Circuit gives Jose Cuervo a history lesson on one of the pillar’s of American society: bourbon. It is an especially American concoction, Judge Martin of Kentucky observes, one that has been enjoyed since 1774 by everyone from Elijah Craig to Ulysses S. Grant, who apparently had a preference for Old Crow.

Plaintiff Maker’s Mark Distillery, Inc. has been sealing its bottles with red wax since the 1950’s, which it registered as trademark in 1985 (Reg. No. 1469925). In 1997, the parent company for Jose Cuervo began using a red sealing wax on its special edition “Riserva de la Familia” tequila, shown here. Maker’s Mark took exception to the use of the red sealing wax and, after Jose Cuervo refused to change the design, filed suit for trademark infringement in 2003.

Now, most people might be reluctant to challenge the strength and recognition of Maker’s Mark’s trade dress in a U.S. District Court in western Kentucky; but hey, too much tequila can make a man do strange things sometimes. At least Jose Cuervo was sophisticated enough to request a bench trial, taking out of play the risk that it would end up with 12 bourbon-loving Kentucky jurors. In a shocking turn of events, the district court found that Maker’s Mark’s registered trademark consisting of its signature trade dress element – a red dripping wax seal – was valid and infringed and enjoined Jose Cuervo from using any similar design. The Sixth Circuit agreed and upheld the district court’s award of costs to Maker’s Mark.

Trade dress is an often unnoticed, but highly valuable form of intellectual property. Recognized as a “symbol” or “device” under the Lanham Act (15 U.S.C. § 1052), trade dress typically encompasses the actual shape or design of a product or its packaging. Some famous examples include the Coca-Cola bottle or Tiffany’s blue box. Unlike traditional trademarks, trade dress must have acquired distinctiveness and it cannot be “functional.” For example, if you see a small blue box wrapped in white ribbon, you don’t have to see the Tiffany’s mark before knowing where it came from. Showing this level of recognition at trial can require a substantial amount of evidence. In this case, the Court found that Maker’s Mark’s fifty years of advertising and substantial sales were enough to satisfy the requirement. It also did not hurt that in 2002 Business Week declared the Maker’s Mark’s seal “one of the most recognizable in the world.”

So next time you go to buy bourbon be rest assured that if you get the bottle sealed in red wax, it’s going to be a Maker’s Mark.

Cheers!

King of Torts Dethroned

Laura Simons — Thu, 10 Mar 2011 13:30:00 +0000

Stanley Chesley, a class-action plaintiffs’ lawyer who became rich and famous for collecting billions of dollars for his clients in various lawsuits throughout his career, is now facing disbarment, the possibility of paying back $7.5 million in fees, and, arguably worse, a “professional death sentence.” The so-called “Master of Disaster” reportedly built his career around a simple strategy: swoop in after a disaster, round up as many clients as possible, and launch a “legal assault” against as many of the deep-pocketed bad guys as possible. How might one who follows such a business model go astray? He allegedly got greedy, with conduct his hearing officer called “shocking and reprehensible” behavior related his keeping far more than his share of a $200 million product liability settlement in Kentucky.

The case at issue was a 1998 class-action lawsuit involving the now withdrawn anti-obesity drug fen-phen, which consisted of more than 400 plaintiffs and was pending in Kentucky’s Boone County. The Wall Street Journal Law Blog reports that Chesley was not initially involved in the litigation, but at some point “muscled” his way into the case and strong-armed the attorneys into sharing fees with him in exchange for his “expertise” in handling class actions. Apparently, though, those attorneys did not notify the plaintiffs of the new arrangement.

The suit eventually resulted in a $200 million settlement with the maker of fen-phen, of which the plaintiffs’ lawyers reportedly kept tens of millions of dollars more than permitted. Of the total settlement, Chesley reportedly received a $20 million fee for his helping settle the case, including a reported additional $4 million for convincing the sitting judge to increase the attorneys’ take on the settlement to 49 percent. That judge later resigned from the bench when it was discovered he allegedly took financial benefit from the settlement in a secret deal.

Of the four plaintiffs’ attorneys involved in that case, three faced criminal charges of fraud and conspiracy. Two were sentenced to 25 and to 20 years in federal prison. As reported at Overlawyered, at the time of those guilty verdicts, it was a mystery as to why Chesley was not similarly charged. Despite that omission, Kentucky’s trial commissioner recently issued his opinion that Chesley should lose his Kentucky law license permanently and return more than $7.5 million in fees collected in the settlement.

Successor Liability Sinks Infomercial Tortfeasor

Kevin Couch — Wed, 15 Sep 2010 11:29:00 +0000

It’s difficult coming up with award-winning content every week. Perhaps that’s why we here at Abnormal Use have not won any awards. Not to be deterred, contributors at the blog scour the web for news and decisions that could provide the kernel of inspiration to set us on our way to winning the blog equivalent of the EGOT. (“30 Rock” premieres on September 23, with a live episode on October 14.) Today, we tread into the sensitive subject of infomercial products.

“In December 2005, James Bishop purchased a Ronco rotissiere oven which was designed, manufactured, marketed, and distributed by Ronco Corporation.” Kentucky Farm Bureau Mut. Ins. Co. v. Ronco Acquisition Corp., No. 2009-CA-001979-MR, 2010 WL 3515808 (Ky. Ct. App. Sept. 10, 2010) [PDF]. Unfortunately for the Bishops, their home burned completely in December 2007, and, even more unfortunately for the Bishops, Farm Bureau pursued a claim against Ronco, asserting that the Ronco oven caused the fire. I’m sure it’s awful having your home burn to ashes. It’s worse when everyone knows that you can’t say no to an infomercial.

Ronco asserts that its oven gives you access to fresh “healthful food [that] has never been easier to prepare.” The webpage also presents testimonials from people who have lost 20+ pounds after buying the oven. Since being a lawyer prevents me from believing anything that I see or hear, let me posit an explanation for this advertising. Consumer A drops $160 + S&H on an oven, and probably more with the purchase of the optional “Rib Basket,” which is “Great for 3 or 4 people.” Upon receipt of the oven, Consumer A realizes that in purchasing the oven, he has spent his food budget for the next two weeks and will be unable to actually buy anything to cook in the oven. By not eating for the next two weeks, Consumer A loses 20 lbs, entirely due to the fact that he purchased the oven. Adding to the absurdity is the notion that the oven’s 3-hour automatic timer allows the consumer to “spend less time cooking and have more time for your active lifestyle.” I’m just guessing that someone who is willing to sit and watch an infomercial, rather than do anything else, to the point where he would order the product, is probably not concerned about an active lifestyle. None of his friends would say that he is at the pinnacle of fitness. He may, in fact, have the nickname, “Rib Basket.”

Fortunately for us, this case has legs. While it may be hard to believe that the original Ronco Corp. went bankrupt, the successor corporation, Ronco Acquisition Corporation, assumed (according to this court) its potential liability in this case via an Asset Purchase Agreement. The Kentucky Court of Appeals then reversed the lower court’s grant of summary judgment to Ronco, and remanded the case. Hopefully, we can bring you more as the facts of this case develop. Until then, you may want to stay away from the oven and try the Pocket Fisherman instead.

Hey, Potential Tortfeasors: Do Business in Kentucky

Kevin Couch — Wed, 03 Mar 2010 13:30:00 +0000

Oh, Kentucky! I wax maudlin as the spring approaches, when the bluegrass begins to grow, and I am reminded of my love of fried chicken, mint juleps, and Billy Ray Cyrus. How wonderful art thou, great state of the Gray Squirrel and the greatest two minutes in sports! And even with all of these enticements to share a state of domicile with Rick Pitino, there is but one ultimate reason to make the move. Although Greenville is a fine place to live, if I were ever to maim or otherwise injure someone, I would hope to do so in Kentucky. I am surprised that the Kentucky Chamber of Commerce does not openly espouse its one year statute of limitations [PDF] on personal injury cases as a benefit of living, maiming, of doing business there. Unfortunately for Johnny Childress, he lived in Kentucky at the time of his injury, and his claim was dismissed because of it.

For reasons not clear in Childress v. Interstate Battery Systems of America, Inc., 2010 WL 600023, No. 1:09CV-54-M (W.D. Ky. Feb. 18, 2010), Mr. Childress did not bring suit within one year of his accident. On November 26, 2007, Mr. Childress drove home, exited his car, and “noticed the distinct odor of battery fumes emanating from his vehicle.” Id. Mr. Childress disconnected the battery, took the battery into his garage, and placed it on a workbench, where it exploded and sent shards of plastic and acid into Mr. Childress’ face and eyes. Childress, inexplicably, waited too late to file his products liability action, and, therefore, he had to assert a theory of recovery that would allow him to maintain his claim. He argued that his accident sounded in the Motor Vehicle Reparations Act, which allowed a two-year period to bring an action.

The two-year limitations period extends to those who were victims of a motor vehicle accident and whose injuries arose out of the use of a motor vehicle. Id. Because the blog adheres to the strictest of legal writing axioms, you already know what the court decided. Childress was not in his vehicle at the time of the explosion, and “it was the battery, not his vehicle, that was the sole cause of his injuries.” Id. Therefore, Childress was time-barred.

Maybe Childress had some bad facts in his claim that would have precluded a finding against the battery distributor, and he was trying to bring in his auto insurer. It’s unclear. But unfortunately for Mr. Childress, who at the very least had a real injury, and perhaps a valid claim, he can’t recover. Manufacturers take note and take advantage of Citizens United: Elect officials who support a one-year statute of limitations. Then I won’t have to move to Kentucky.