Doublestar wins partial summary judgment against Toyo

A judge before the U.S. District Court for the Central District of California has granted partial summary judgment to two Chinese tire makers in their long-standing litigation with Toyo Tire & Rubber Co.

Doublestar Dong Feng Tyre Co. Ltd. and Qingdao Doublestar Industrial Tire Co. Ltd. asked the court for summary judgment to dismiss the request for treble damages made by Toyo and its U.S. subsidiary in Toyo's case accusing the Doublestar companies of trade dress infringement and unfair competition.

On June 26, Judge Cormac J. Carney granted the Doublestar companies' motion as related to Toyo's lost profits based on Toyo's lost sales, disgorgement of Doublestar's profits based on unjust enrichment or Toyo's request for attorneys' fees.

The case dates to February 2015, when Toyo sued Doublestar and related companies, accusing them of infringing the design of Toyo's Open Country M/T premium off-road light truck tire.

Mr. Carney partially granted Toyo's motion for summary judgment in the case on April 12, 2018. Toyo then sought treble damages under the Lanham Act, which forbids trademark infringement, trademark dilution and false advertising.

The Doublestar companies filed for partial summary judgment against Toyo May 7, with a follow-up filing May 21, accusing Toyo of misrepresenting the case to bolster its fraud claims. Toyo countered June 4, stating that Doublestar's version of the case was "remarkably at odds with the evidence of record."

In granting Doublestar's motion, Mr. Carney noted "numerous disputed issues of material fact" regarding Toyo's fraud claims against Doublestar, which led him to deny Doublestar's motion for summary judgment on that issue.

On the trade dress issue, however, Mr. Carney partly granted Doublestar's motion.

"Because Toyo has not presented any competent evidence of its own lost profits, Toyo cannot seek any damages under that theory," he wrote.

Toyo's evidence of lost profits, according to Carney, was based on the "gut feeling" of Amy Coleman, Toyo's senior director of marketing, who said Toyo could have made half of the sales that went to Doublestar's infringing tire.

"Ms. Coleman's arbitrary percentage is not a reasonably certain basis on which a jury could determine damages," he wrote.

However, Toyo was free to seek damages against Doublestar for extraterritorial sales of the infringing tires before the entry of the final judgment, and also under a theory of unjust enrichment, Mr. Carney ruled.