Case 2:13-cv-00749-DN-DBP Document 245 SEALED Filed 03 ...

BIMBO BAKERIES USA, INC.,

Plaintiff, v.

LELAND SYCAMORE, TYLER SYCAMORE, WILD GRAINS BAKERY, LLC, and UNITED STATES BAKERY, INC.,

SEALED MEMORANDUM DECISION AND ORDER DENYING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT

Case No. 2:13-cv-00749 DN

District Judge David Nuffer

Defendants.

Case 2:13-cv-00749-DN-DBP Document 245 *SEALED* Filed 03/29/17 of 13

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH, CENTRAL DIVISION

Plaintiff Bimbo Bakeries (Bimbo) filed this case against multiple Defendants principally

alleging that the Defendants misappropriated Bimbo's trade secrets for making bread. Two of the

Defendants, Tyler Sycamore (Tyler), and his business, Wild Grains Bakery, LLC (Wild Grains),

(collectively referred to as Defendants), moves for summary judgment on all of Bimbo's claims

against them. These claims include: (1) trade secret misappropriation, (2) trade dress

infringement, and (3) trade dress dilution. For the reasons stated in this order, Defendants'

motion for summary judgment is DENIED in its entirety.

UNDISPUTED FACTS 2

LEGAL STANDARD 5

DISCUSSION 5

Trade Secret Misappropriation 5

1. The Defendants Have Not Shown Bimbo's Purported Trade Secret is Generally Known. .6

2. Bimbo's Combination of Well-Known Processes is Specific and Unique. 7

3. There Are Disputed Facts About Whether Tyler Misappropriated the Trade Secret 8

Trade Dress Infringement and Dilution 9

ORDER 11

1

Case 2:13-cv-00749-DN-DBP Document 245 *SEALED* Filed 03/29/17 Page 1 of 13

I N THE UNITED STATES DISTRICT COURTFOR TIIE DISTRICT OF UTAH, CENTRAL DIVISION

BIMBO BAKERIES USA, INC.,

Plaintiff.

I ELAND SYCAMORE, TYLERSYCAMORE. WILD GRAINS BAKERY,LLC, and UNI FED STATES BAKERY, INC..

Defendants.

SEALED MEMORANDUM DECISIONAND ORDER DENYING DEFENDANTS'MOTION FOR SUMMARY JUDGMENT

Case No. 2: 13-cv-007-1-9 DN

District Judge David Niftier

Plaintiff Bimbo Bakeries (Bimbo) filed this case against multiple Defendants principally

alleging that the Defendants misappropriated Bimbo's trade secrets for making bread. Two of the

Defendants, Tyler Sycamore (Tyler), and his business, Wild Grains Bakery, LLC (Wild Grains),

( collectively referred to as Defendants), moves for summary judgment on all of Bimbo's claims

against them. These claims include: (1) trade secret misappropriation, (2) trade dress

i nfringement, and (3) trade dress dilution. For the reasons stated in this order, Defendants'

motion for summary judgment is DENIED in its entirety.

UNDISPUTED FACTS

LEGAL STANDARD 5

DISCUSSION 5

Trade Secret Misappropriation 5

I . 'fhe Defendants 1-lave Not Shown Bimbo's Purported Trade Secret is Generally Known..6

2. Bimbo's Combination of Well -Known Processes is Specific and Unique. 7

3. There Are Disputed Facts About Whether Tyler Misappropriated the Trade Secret 8

Trade Dress Infringement and Dilution 9

ORDER 11

Bimbo Bakeries USA v. Sycamore et al Doc. 249

Dockets.Justia.com

https://dockets.justia.com/docket/utah/utdce/2:2013cv00749/90183/

https://docs.justia.com/cases/federal/district-courts/utah/utdce/2:2013cv00749/90183/249/

https://dockets.justia.com/

race 2:13_rv-n0749-nr\i-nRp Document 245 *SEAL ED* Filed 03/29/17 Paae 2 of 13

UNDISPUTED FACTS

Leland Sycamore ("Leland") invented the process and formula — including the elements

constituting the alleged trade secrets at issue — for making Grandma Sycamore's Home-Maid

Bread ("Grandma Sycamore's") in 1979 at Aaron Bakery.' Leland used packaging for Grandma

Sycamore's that was substantially similar to packaging his successor, Bimbo, still uses to sell the

bread today.2 Leland received federal trademark protection for part of the packaging's design in

1999.3

When Leland's son, Tyler, was 14 years old, he worked for his father's company.4 It is,

however, disputed whether Tyler was actually involved in making Grandma Sycamore's bread.5

Bimbo claims that, through years of working at the company, Tyler was well aware of the

process for baking Grandma Sycamore's bread. Tyler, however, asserts that he was merely

involved in simple tasks such as slicing bread and has no knowledge of the process for making

the bread.6

In 1998, Leland sold Grandma Sycamore's rights to one of Bimbo's predecessors-in-

interest for 7 The purchase was

1 Statement of Elements and Undisputed Material Facts (SOF) at ¶ 1; docket no. 115.

2 May 16, 2016 Declaration of Christopher D. Smith in Support of Bimbo's Motion for Partial Summary Judgment ["5/16/16 Smith Dec."] at ¶ 3; docket no. 199-9.

3 Docket no. 157-7.

4 Ex. G, Deposition of Tyler Sycamore as Rule 30(b)(6) witness for Wild Grains, dated October 30, 2013 ("Tyler Dep"); docket no. 199-11 at 11:14-16, 12:10-13.

5 /d. at 12:14-21, 14:15 — 15:1.

6 /d. at 14:1-10.

7 SOF at ¶ 2; Ex. H, Aaron Bakery Asset Purchase Agreement [Bimbo 1495-1521], at Bimbo 1499-500; docket no. 199.

2

mace 7:12_rv_00740.-nni .nRp Document 24R *SFAI Fn* Filed 03/29/17 Paae 2 of 13

UNDISPUTED FACTS

Leland Sycamore ( - Leland") invented the process and formula— including the elements

constituting the alleged trade secrets at issue — for making Grandma Sycamore's Home-Maid

Bread ("Grandma Sycamore's -) in 1979 at Aaron Bakery. ' Leland used packaging for Grandma

Sycamore's that was substantially similar to packaging his successor, Bimbo, still uses to sell the

bread today. Leland received federal trademark protection for part of the packaging's design in

1 999. 3

When Leland's son, Tyler. was 14 years old, he worked for his father's eompany. 4 It is,

however, disputed whether Tyler was actually involved in making Grandma Sycamore's bread. 5

Bimbo claims that, through years of w'orking at the company, Tyler was woll aware of the

process for baking Grandma Sycamore's bread. Tyler, hon ever, asserts that he was merely

i nvolved in simple tasks such as slicing bread and has no knowledge of the process for making

t he bread.'"

I n 1998, Leland sold Grandma Sycamore's rights to one of Bimbo's predecessors -in -

interest for The purchase was

Statement of Elements and Undisputed Material Facts (SOF) at 1 1; docket no. 115.

Man 16. 2016 DecIntation oh CD istopher D. Smith in Support on:limbo's Motion for Partial SUMinary Judgment

1 - 5/16/16 Smith Dec. - at 3: docket no. 199-9.

Docket no. 157-7.

4 En. 0, Deposition of Tyler Sycamore as Rule 30(b)(6) witness For Wild Grains, dated October 30, 2013 (1 ylei -

Dep- ); docket no. 199-1 1 at 1 1 :14-16. 12:10-13,

hi. at 12: 14-21. 14:15 -- 15:1.

N. at 14:1-10.

• SOF at lj 2; Ex. IL Aaron Bakery Asset Purchase Agreement Bimbo 1405-15211. at Bimbo 1499-500; docket no.1 99.


.8 As part of the transaction, Leland executed a

nondisclosure agreement, which requires, among other things, him to keep confidential and

refrain from using Grandma Sycamore's production formulations, manufacturing processes, and

trade secrets.9

Bimbo asserts trade secret protection over the production process of Grandma

Sycamore's white bread.1° Bimbo claims that the production process is composed of the

compilation of

: i

: i

.13

8 Id. 9 Docket no. 199-13; Ex. H at 1516.

10 Docket no. 37; Amend. Compl.

11 Docket no. 199-2; Ex. A, Hoseney Rep. at ¶ 24. 12 Id.

13 Id. at 1125(a).

3


As part of the transaction, Leland executed a

nondisclosure agreement, which requires, among other things, him to keep confidential and

r efrain :from using Grandma Sycamore's production formulations, mannfacturing processes, and

t rade secrets. 9

Bimbo asserts trade secret protection over the production process of Grandma

Sycamore's white bread. 10 Bimbo claims that the production process is composed of the

compilation of

(

(

(

13(

Docket no. 199-13: Ex. II at 1516.

Docket no. 37; Amend. Compl .

I I Docket no. 199-2; Ex. A, I foseney Rep. at 4,j 24.

I d at 1125(a).

3

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14

Bimbo claims that Tyler, through his previous business Wild Grains, misappropriated its

trade secrets and trademarks associated with Grandma Sycamore's white bread.15 Tyler claims

he could not misappropriate Grandma Sycamore's alleged trade secret because he had no

knowledge of the production process for making the bread. 16Although it is disputed whether

Tyler had this knowledge, there is evidence that Jeremy Faull, the production manager at Wild

Grains, learned the process for making the bread from the previous owner of Grandma

Sycamore's, Leland.17

For a period of three months, Wild Grains sold bread named Grandma Emilie's to United

States Bakery (U.S. Bakery).18 Bimbo asserts that U.S. Bakery infringed on Grandma

Sycamore's trade dress and that the Defendants are also liable as contributory infringers.19

In May 2013, Faull went to work for U.S. Bakery.2° Bimbo also claims that Faull

improperly misappropriated Grandma Sycamore's recipe for making white bread to U.S.

Bakery.21

14 Id. at1125(b).


16 Docket no. 115; Mot. Summ. J. p. 25.

12 Id.

18 Id. at p. 29.


20 Docket no. 199-17; Faull Dep. 8:19-25 to 9:1-6.


4

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14

Bimbo claims that Tyler, through his previous business Wild Grains, misappropriated its

t rade secrets and trademarks associated with Grandma Sycamore's white bread. 5 Tyler claims

he could not misappropriate Grandma Sycamore's alleged trade secret because he had no

k nowledge of the production process for making the bread. )Althowr it is disputed whether

Tyler had this know ledge, there is evidence that Jeremy Faulk the production manager at \\

Grains, learned the process for making the bread from the previous owner of Grandma

Sycamore's, Leland. I7

For a period of three 11101.1.[11S. Grains sold bread Ili:tilled United

States Bakery (U.S. Bakery). 1' Bimbo asserts that U.S. Bakery infringed on Grandma

Sycamore's trade dress and that the Defendants are also liable as contributory infringers. 1 `)

•I n May 2013, Fault went to work for U.S. Bakery. ,- 0 Bimbo also claims that Fault

i mproperly misappropriated Grandma Sycamore's recipe for making white bread to U.S.

Bakery. -

' LI. ', it .' 2501).

Docket no. 37; Amend.

Docket no. 1 15; Niot. Surin. J. p. 25.

17"

I d. at p. 29.

I" Docket no. 37: Amend. Comp!.

Docket no. 199-17; Paul l Dep. 8:19-25 to 9:1-6.

DOCkei. no. 37; Amend. Comp'.

4


LEGAL STANDARD

Summary judgment is appropriate if "there is no genuine dispute as to any material fact

and the movant is entitled to judgment as a matter of law."22 A factual dispute is genuine when

"there is sufficient evidence on each side so that a rational trier of fact could resolve the issue

either way."23 In determining whether there is a genuine dispute as to material fact, the court

should "view the factual record and draw all reasonable inferences therefrom most favorably to

the nonmovant."24

The moving party "bears the initial burden of making a prima facie demonstration of the

absence of a genuine issue of material fact and entitlement to judgment as a matter of law."25

DISCUSSION

Defendants move for summary judgment on Bimbo's claims for (1) trade secret

misappropriation, (2) trade dress infringement, and (3) trade dress dilution. As the moving party,

it is the Defendants' burden to show that there are no disputes of material facts and that they are

entitled to judgment as a matter of law. Each challenged claim will be addressed in this order, as

well as the reasoning for denying summary judgment.

Trade Secret Misappropriation

The Defendants raise three arguments for dismissal of Bimbo's trade secret

misappropriation claim. They argue first that Bimbo does not have a protectable trade secret;

second, that Bimbo has not defined its trade secret with specificity; and third, that even if Bimbo

has a trade secret, Tyler and Wild Grains did not misappropriate it. The order will address each

of the Defendants' arguments and the reasons the arguments fail on summary judgment.

22 Fed. R. Civ. P. 56(a).

23 Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 670 (10th Cir. 1998).

24 Id.

25 Id. at 670-71.

5


LEGAL STANDARD

Summary judgment is appropriate if "there is no genuine dispute as to any material fact

and the movant is entitled to judgment as a matter of law." 22 A factual dispute is Genuine when

" there is sufficient evidence on each side so that a rational trier of fact could resolve the issue

. 7,e ither way. - ' In determining whether there is a genuine dispute as to material fact, the court

should "view the factual record and draw all reasonable inferences therefrom most favorably to

t he nonmovant." 24

The moving party "bears the initial burden of making a prima facie demonstration of the

absence of a genuine issue of material fact and entitlement to judgment as a matter of law. " 25

DISCUSSION

Defendants move for summary judgment on Bimbo's claims for (I) trade secret

misappropriation, (2) trade dress infringement, and (3) trade dress dilution. As the moving party,

i t is the Defendants' burden to show that there are no disputes of material facts and that they are

entitled to judgment as a matter of law. Each challenged claim will be addressed in this order, as

well as the reasoning for denying summary judgment.

Trade Secret Misappropriation

The Defendants raise three arguments for dismissal of Bimbo's trade secret

misappropriation claim. They argue first that Bimbo does not have a protectable trade secret;

second, that Bimbo has not defined its trade secret with specificity; and third, that even if Bimbo

has a trade secret, Tyler and Wild Grains did not misappropriate it. The order will address each

of the Defendants' arguments and the reasons the arguments fail on summary judgment.

22 Fed. It. Civ. P. 56(a).

23 .•1(//// v. I - Val -Aldo Stores. Inc. . 144 17.3/1664 670 (10th Cir. 1098).

24 hi.

2' hi. at 670-7] .

a

('ase 2:13-cv-007A9-nNI-nnP nr1r9ivvv~nmont 94c *RPfas1 Pn* nRocVi 7 Pane A of 12

1. The Defendants Have Not Shown Bimbo's Purported Trade Secret is Generally Known.

Bimbo asserts trade secret protection over the compilation of

Utah has adopted the Uniform Trade Secrets Act. Under the act, a trade secret can be a

"compilation" that "derives independent value, actual or potential, from not being generally

known to, and not being readily ascertainable by proper means by, other persons who can obtain

economic value from its disclosure or use."26 "A compilation can be made up of known

elements, if the combination itself is outside the general knowledge and not ascertainable by

proper means."27 The Tenth Circuit has been clear that when the plaintiff asserts trade secret

protection under a compilation theory, an analysis of the individual trade secret components in

isolation is improper.28

The Defendants analyze each individual element of Bimbo's purported trade secret and

argue that the elements in isolation are generally known. While viewing each individual element

may be helpful in determining whether the compilation of the elements is generally known, the

fact that an individual element is generally known in isolation otherwise proves very little.

Even if Defendants' piecemeal analysis were valid and it was found that each individual

step in the process of producing Grandma Sycamore's bread was generally known, judgment still

could not be entered in their favor. As the moving party, it is the Defendants' burden to show

that the compilation of individually generally known processes is also otherwise generally

known. Because the Defendants have not met this burden, summary judgment cannot be granted.

26 Utah Code Ann. § 13-24-2(4)(a).

27 Brigham Young Univ. v. Pfizer, Inc., 861 F. Supp. 2d 1320, 1323 (D. Utah 2012).

28 See Rivendell Forest Prods, Ltd. v. Georgia-Pacific Corp., 28 F.3d 1024, 1045 (10th Cir. 1994).

6

-) : 1Q. cv .0074g_nN_npp nnr, , mont 7/1. *RFAI P n* Tiled fl n/70/17Panej of .13

1. The Defendants Have Not Shown Bimbo's Put ported Trade Secret is Generally

Known.

Bimbo asserts trade secret protection over the compilation of

(

Utah has adopted the Uniform Trade Secrets Act. Under the act, a trade secret can be a

" compilation" that "derives independent Value, actual or potential, from not being generally

k nown to, and not being readily ascertainable by proper means by, other persons who can obtain

economic value from its disclosure or use." 2-6 "A compilation can be made up of known

elements, if the combination itself is outside the general knowledge and not ascertainable by

proper means." 27 The Tenth Circuit has been clear that when the plaintiff asserts trade secret

protection under a compilation theory, an analysis of the individual trade secret components in

i solation is improper. 2'"

The Defendants analyze each individual element of Bimbo's purported trade secret and

argue that the elements in isolation are generally known. While viewing each individual element

may be helpful in determining whether the compilation of the elements is generally known, the

f act that an individual element is generally known in isolation otherwise proves very little.

Even if Defendants piecemeal analysis were valid and it was found that each individual

step in the process of producing Grandma Sycamore's bread was generally known judgment still

could not be entered in their favor. As the mo\.,: . ing party, it is the 1 I. -)urc : en .0 s.low

t hat the compilation of individually generally known processes is also otherwise generally

k nown. Because the Defendants have not met this burden, summary judgment cannot be granted.

Utah Code Arm. 13-24-2(4)00.

BriKhum Young Lou '. u. Pfizer, hie., 801 Supp. 20 1320, 1323 (D.Itch 2012).

FUrCSi Prods, Lal. r. GCOrgia-POCOC Corp. . 28 1i. 3d 1024. 1045 (10th 1004).


Whether each individual element of the trade secret is generally known need not be discussed

because the Defendants do not argue that the compilation of elements is generally known.

Furthermore, the facts in the record show that despite Grandma Sycamore's existence in the

market for many years, competitors have tried to replicate the production process and have

failed.29 At a minimum, this is a material fact that is evidence that the production process of

Grandma Sycamore's bread is not generally known.

2. Bimbo's Combination of Well-Known Processes is Specific and Unique.

The Defendants only argument about the trade secret process in compilation is that the

process Bimbo claims is not specific or unique. To establish the existence of a trade secret in

compilation, the claimant must specifically "explain how the combination of elements is

sufficiently different, or special, to merit protection."3° A plaintiff may not point to a mass of

information and claim that a secret lies somewhere within.31

The Defendants argue that Bimbo has not provided detailed disclosures of information or

protocols for its purported trade secret, and commercial farm bread in general does not qualify as

a trade secret. This argument is misplaced. Bimbo does not point to a mass of information, nor

does Bimbo claim trade secret protection in farm bread in general. Bimbo points to

in the production of Grandma Sycamore's bread and argues that the steps, in compilation,

qualify as a protectable trade secret.

There is nothing vague about Bimbo's description of its trade secret. The description is

included in the fact section above and is clear. The description does not point to a mass of

information; rather the purported trade secret only spans one to two pages in length. The

29 Docket no. 199-6; Ex. DD, 1/14/14 Faull Dep. At 19:14-20:20

30 Brigham Young Univ. v. Pfizer, Inc., 861 F. Supp. 2d 1320, 1324 (D. Utah 2012). 31 See Id.

7


Whether each individual element of the trade secret is generally known need not be discussed

because the Defendants do not argue that the compilation of elements is generally known.

Furthermore. the facts in the record show that despite Grandma Sycamore "s existence in the

market for many years, competitors have tried to replicate the production process and have

f ailed. 29 At a minimum, this is a material fact that is evidence that the production process of

Grandma Sycamore's bread is not generally known.

2. Bimbo's Combination of Well -Known Processes is Specific and Unique.

The Defendants only argument about the trade secret process in compilation is that the

process Bimbo claims is not specific or unique. To establish the existence of a trade secret in

compilation, the claimant must specifically "explain how the combination of elements is

s ufficiently different, or special, to merit protection. - A plaintiff may not point to a mass of

i nformation and claim that a secret lies somewhere within.''

The Defendants argue that Bimbo has not provided detailed disclosures of information or

protocols for its purported trade secret, and commercial farm bread in general does not qualify as

a trade secret -. This argument is misplaced. Bimbo does not point to a mass of information, nor

does Bimbo claim trade secret protection in farm bread in general. Bimbo points to

in the production of Grandma Sycamore's bread and argues that the steps, in compilation,

qualify as a protectable trade secret.

' ['here is nothing vague about Bimbo's description of its trade secret. The description is

i ncluded in the fact section above and is clear. The description does not point to a mass of

i nformation; rather the purported trade secret only spans one to two pages in length. The

-1' Docket no. 199-6: 11x. 1)1), 1/1414 Foul! E)cp. At 19: 14-20:20

" 13ri,hanr Yonng Univ. v. Plizci, Inc. , 861 F. Stipp. 2d 1320, 1324 (D. U It'dh 2012).

S'cc

7

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Defendants have failed to show that Bimbo was not specific in its description of the purported

trade secret.

3. There Are Disputed Facts About Whether Tyler Misappropriated the Trade Secret.

Bimbo has the burden at trial of proving that its alleged trade secrets were disclosed by

Wild Grains and Tyler.32 On summary judgment, however, the moving party has the burden of

proving that there are no disputes of material fact about whether the trade secret was

misappropriated.

Tyler first argues that he could not have misappropriated the trade secret for making

bread because he never made bread at his father's bakery, and he otherwise has no knowledge

about Grandma Sycamore's process for making bread. This fact, however, is disputed. Bimbo

.1...- 1_...1 —11 1, • 1" A ldal argUGS Mal 1 ylC iolovviQuge 01 proccss ior making .Jranuma

Summary judgment cannot be entered finding that Tyler could not have misappropriated the

trade secret. It is disputed whether Tyler had knowledge of Grandma Sycamore's production

process..

Tyler then argues that Wild Grains uses a different recipe than the one used by Grandma

Sycamore. Faull, the production manager at Wild Grains, added and

to the basic recipe he learned from Leland. Tyler claims that because the recipes have some

differences, then the trade secret was not misappropriated as a matter of law. The Defendants

have not included any citations for the proposition that making a minor change to a trade secret

is enough to avoid liability. Summary judgment therefore cannot be granted on this basis.

The Defendants' last argument is that if Faull did in fact misappropriate the alleged trade

secret for making Grandma Sycamore's white bread, then he did so as an employee of U.S.

32 See Storagecraft Tech. Corp. v. Persistent Telecom Sols., Inc., 2015 WL 9692517, *8 (D. Utah 2015).

8

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Defendants have failed to show that Bimbo was not specific in its description of the purported

t rade secret.

3. There Are Disputed Facts About Whether Tyler Misappropriated the Trade Secret.

Bimbo has the burden at trial of proving that its alleged trade secrets were disclosed by

Wild Grains and Tyler. 32 On summary judgment, however, the moving party has the burden of

proving that there are no disputes of material fact about whether the trade secret was

misappropriated.

Tyler first argues that he could not have misappropriated the trade secret for making

bread because he never made bread at his father's bakery, and he otherwise has no knowledge

about Grandma Sycamore's process for making bread. This fact, however, is disputed. Bimbo

. 11 - gties that y had 1'011 k ilOWICIlge 0 f the plOCeSS 10F Making G rail d S'y Ca MO FC, S bccad.

Summary judgment cannot be entered finding that Tyler could not have misappropriated the

t rade secret. It is disputed whether Tyler had knowledge of Grandma Sycamore's production

process..

Tyler then argues that Wild Grains uses a different recipe than the one used by Grandma

Sycamore. Fault, the production manager at Wild Grains, added and

t o the basic recipe he learned from Leland. Tyler claims that because the recipes have some

differences, then the trade secret was not misappropriated as a matter of law. The Defendants

have not included any citations for the proposition that making a minor change to a trade secret

i s enough to avoid liability. Summary judgment therefore cannot be granted on this basis.

The Defendants' last argument is that if Fault did in fact misappropriate the alleged trade

secret for making Grandma Sycamore's white bread, then he did so as an employee of

t oragccralt Tcch. Corp. Pcrsistcpt Telecom Sots. , Inc. , 2015 \\ 7 1, 9602517, *8 (D. Utah 2015).


Bakery, and not as an employee of Wild Grains. This fact, however, is also disputed. Bimbo

claims that Tyler and Wild Grains sold the allegedly infringing bread to U.S. Bakery prior to

Faull's employment with U.S. Bakery.33 In any event, even if the trade secret was not

misappropriated to U.S. Bakery, it still could have been misappropriated through Wild Grains

use in making the competing bread.34

For the aforementioned reasons, because disputed material facts exist, summary

judgement cannot be granted on Bimbo's trade secret claim.

Trade Dress Infringement and Dilution

Tyler and his company Wild Grains seek summary judgment on Bimbo's trade dress

infringement and trade dress dilution claims. Their principal argument is that Wild Grains had no

role in developing the packaging of Grandma Emilie's bread. Wild Grains only made the bread,

and U.S. Bakery did the packaging and sales. It is undisputed that Wild Grains has never owned

the Grandma Emilie's mark.

As support for Tyler's argument that he is entitled to summary judgment because he had

no role in developing the packaging, he cites the following elements discussed in General

Motors Co. v. Urban Gorilla, LLC, 2010 WL 5395065 (D. Utah 2010): "(3) the defendant began

using its mark or trade name after the plaintiff's mark became famous; (4) the defendant's use of

his mark is in commerce; and (5) the defendant's mark must be likely to cause dilution to the

plaintiff's mark."35 Tyler argues that the language used in General Motors Co. creates a

33 U.S. Bakery referred to the bread it bought from Wild Grains in internal documents as Grandma Sycamore's bread

34 Ex. R, PX 92, 93, 147, 149, 150; Ex. Q, Deposition of Marc Albers as Rule 30(b)(6) witness for U.S. Bakery, May 18, 2015 (Albers 5/18/15 Dep.) at 15:4 — 40:10.

35 General Motors Co. v Urban Gorilla, LLC, 2010 WL 5395065 (D. Utah 2010).

9


Bakery, and not as an employee of Wild Grains. This fact, however, is also disputed. Bimbo

claims that Tyler and Wild Grains sold the allegedly infringing bread to U.S. Bakery prior to

Faull's employment with Bakery. 33 In any event, even if the trade secret was not

misappropriated to U.S. Bakery, it still could have been misappropriated through Wild Grains

use in making the competingbread. 34

For the aforementioned reasons, because disputed material facts exist, summary

j udgement cannot be granted on Bimbo's trade secret claim.

Trade Dress Infringement and Dilution

Tyler and his company Wild Grains seek summary itidgment on Bimbo's trade dress

i nfringement and trade dress dilution claims. Their principal argument is that Wild Grains had no

r ole in developing the packaging of Grandma Emilie's bread. Wild Grains only made the bread,

and U.S. Bakery did the packaging and sales. It is undisputed that Wild Grains has never owned

t he Grandma Emilie's mark.

As support for Tyler's argument that he is entitled to summary judgment because he had

no role in developing the packaging, he cites the following elements discussed in Gcncro/

Motors Co. v. Urban Gorilla, LLC, 2010 WL 5395065 (I). Utah 2010): "(3) the defendant began

using its mark or trade name after the plaintiff's mark became famous: (4) the defendant's use of

h is mark is in commerce; and (5) the defendant's mark must be likely to cause dilution to the

plaintiffs mitrk." 3 Tyler argues that the language used in General i'llotors' Co. creates a

U.S. Bakery referred to the bread it bought from Wild Grains in internal documents as Grandma Sycamore'sbread

34 . I R. PX 92. 93, 147. 149, 150: Ex. Q, Deposition of Niarc ;\.lbcFs its Rule 30(b)(6) witness for Bakery,Mae 15, 2015 (Albers 5/18/15 Dep.) at 15:4 — 40:10.

3' Galicia! Aloror.s . Co. -v. Gorilla, I.LC, 2010 \VI, 5395065 (I). Utah 2010).

rsase 2:13-cv-007A9_nN_1pp vvvan[mom 74c *RpAi.- pn* Fi!prt nqi7Q/17 Pagp 1n nt

requirement that an infringer must own a mark in order to be liable. This argument runs counter

to binding Supreme Court precedent.36

In General Motors Co. the court was paraphrasing 15 U.S.C. § 1125(c)(1) of the Lanham

Act. It appears that the General Motors court was not intending to impose a requirement that one

must own an infringing trademark in order to be liable. The General Motors court was not

addressing whether ownership of the trademark is a necessary requirement.

Bimbo correctly argues that there is no requirement that one must own a mark in order to

be liable for trade dress infringement or trade dress dilution. Bimbo points to the language of the

applicable Lanham Act provision that states that trade dress dilution occurs when a "person who,

at any time after the owner's mark has become famous, commences use of a mark or trade name

in commerce that is likely to cause dilution by blurring or dilution by tarnishment of the famous

mark."37 The language of the statute does not expressly impose an ownership requirement. Use is

enough.

Bimbo further asserts that it does not matter that Wild Grains did not sell the infringing

product because it is still liable as a contributory infringer. Bimbo claims that Wild Grains is

liable under the "tools of infringement" doctrine which holds that when "use is known to the

manufacturer or is reasonably foreseeable," " the courts have imputed the distributors' infringing

use of the trademark to the initial manufacturer."38

The Defendants argue that the cases Bimbo cites dealing with the tools of infringement

doctrine deal with drastically different factual scenarios than the facts in our case. For example,

Bimbo cites 1-800 Contacts, Inc. v. Lens.com, Inc., 722 F.3d 1229, 1249 (10th Cir. 2013) as its

36 See Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 456 U.S. 844 (1982).

37 15 U.S.C. § 1125(c)(1).

38 3-11 Gilson on Trademarks § 11.02(h)(ii) (2015).

10

r•n s. c cv _00719_nN nP.p nnournont 9/i *RPAI ri!Pri 11217Q/17 P;, -/ClP 1n of 12,

r equirement that an infringer must own a mark in order to be liable. This argument runs counter

t o binding Supreme Court precedent.''

I n Gc/icra/ Motors Co. the court was paraphrasing 15 U.S.C. § 1 125(0(1) of the Lanham

Act. It appears that the (ignorer! Motors court was not intending to impose a requirement that one

must own an infringing trademark in order to be liable. The Gcncra/ Motors court was not

addressing whether ownership of the trademark is a necessary requirement.

Bimbo correctly argues that there is no requirement that one must own a mark i n or der to

be liable for trade dress infringement or trade dress dilution. Bimbo points to the language of the

a pplicable Lanham Act provision that states that trade dress dilution occurs when a "person who,

at any time after the owner's mark has become famous. commences use of a mark or trade name

i n commerce that is likely to cause dilution by blurring or dilution by tamisitment of die famous

mark.` The language of the statute does not expressly impose an ownership requirement. Use is

enough.

Bimbo further asserts that it does not matter that Wild Grains did not sell the infringing

product because it is still liable as a contributory infringer. Bimbo claims that Wild Grains is

l iable under the "tools of infringement" doctrine which holds that when "use is known to the

manufacturer or is reasonably foreseeable," " the courts have imputed the distributors' infringing

use of the trademark to the initial manufacturer. -

The Defendants argue that the cases Bimbo cites dealing with the tools of infringement

doctrine deal with drastically different factual scenarios than the facts in our case. For example,

Bimbo cites 1-800 Contact,s', Inc. v. Lc li ssom. Inc. , 722 F.3d 1229, 1249 (10th Cu. 2013) as its

„See Inwood Laboratories, Inc. r. /yes Laboratories, Inc. .456 U.S. 844 (1982).

1 5 U.S.C. 1125(c)(1).

3-11 Gilson on tradenvancs § 1 1 .02(1)0i) (2015).

10


primary support.39 This case, however, found the Defendant, Lens.com, liable as a contributory

infringer based on the infringing acts of affiliates that Lens.com hired to do its marketing. The 1-

800 Contacts case held Lens.com liable based on the acts of its agents. In our case, there is no

claim that Tyler and Wild Grains were acting as U.S. Bakery's agents. The Defendants therefore

argues that because Bimbo has not pointed to a case with similar facts they are therefore entitled

to summary judgment.

However, the Supreme Court in Inwood Laboratories held:

[L]iability for trademark infringement can extend beyond those who actually mislabel goods with the mark of another. Even if a manufacturer does not directly control others in the chain of distribution, it can be held responsible for their infringing activities under certain circumstances. Thus, if a manufacturer or distributor intentionally induces another to infringe a trademark, or if it continues to supply its product to one whom it knows or has reason to know is engaging in trademark infringement, the manufacturer or distributor is contributorily responsible for any harm done as a result of the deceit.°

Whether Wild Grains had knowledge that they were supplying bread to a company that

was infringing on Bimbo's trademark rights is in genuine dispute. Tyler's long history and

familiarity with the marks and packaging associated with Grandma Sycamore is evidence that

Tyler may have known that U.S. Bakery was infringing on Bimbo's trademark Summary

judgment therefore cannot be granted on Bimbo's trade dress claims.

ORDER

Defendants', Tyler Sycamore and Wild Grains, motion for summary judgment is

DENIED in its entirety.41

Within fourteen days after filing of this order, the parties shall send a redacted version of

this document to dj.nufferAutd.uscourts.gov. The redacted version shall obscure all protected

39 1-800 Contacts, Inc. v. Lens.com, Inc., 722 F.3d 1229, 1249 (10th Cir. 2013).

40 See Inwood Laboratories, Inc., at 854.

41 Docket no. 115.

11


primary support. - This case, however, found the Defendant, Lens.com, liable as a contributory

i nfringer based on the infringing acts of affiliates that Lens.com hired to do its marketing. The /-

SOO Comacts case held Lens.com liable based on the acts of its agents. In our case, there is no

claim that Tyler and Wild Grains were acting as U.S. Bakery's agents. The Defendants therefore

argues that because Bimbo has not pointed to a case with similar facts they are therefore entitled

t o summary judgment.

However, the Supreme Court in britood Laboratories held:

[ L]iability for trademark infringement can extend beyond those who actuallymislabel goods with the mark of another. Even if a manufacturer does not directlycontrol others in the chain of distribution, it can be held responsible for theiri nfringing activities under certain circumstances. Thus, if a manufacturer ordistributor intentionally induces another to infringe a trademark, or if it continuest o supply its product to one whom it knows or has reason to know is engaging int rademark infringement, the manufacturer or distributor is contributorilyr esponsible for any harm done as a result of the deceit. 4

Whether Wild Grains had knowledge that they were supplying bread to a company that

was infringing on Bimbo's trademark rights is in genuine dispute. Tyler's long history and

f amiliarity with the marks and packaging associated with Grandma Sycamore is evidence that

Tyler may have known that U.S. Bakery was infringing on Bimbo's trademark. Summary

j udgment therefore cannot be granted on Bimbo's trade dress claims.

ORDER

Defendants', Tyler Sycamore and Wild Grains, motion for summary judgment is

DENIED in its entirety. 4

Within fourteen days after filing of this order, the parties shall send a redacted Version of

t his document to dj.nufferiAttd.uscourts.gov. The redacted version shall obscure all protected

i -S00 COMUCIS, Inn. Lcns.com, Inn., 722 F.3d 1229. 1249 (10th Cir. 2013).

4" Sun Inwood Laboratories,

4' Docket no. 115.

11

rsase 2_:13-cv-007119-nl`.1-P nocurnent 245 * ,,L . r-1* Filed 03/29/17 Page 1`2 of 13

info iation and shall be a text-based PDF. If the redactions are acceptable, the redacted version

will be placed on the docket.

Signed March 29, 2017.

BY THE COURT

District Judge Dav'd Nufer

12

ocn 7•1"2 rs,nr .17AcLimm. 1- 11:1D 1Thnni in-Innt '9 /1 A I . 1".1* Tdoc,i 03/29/17 19 of 1'24- . V I I V V,-,1 I I IV I IL 4-- - 1- V 1L VI 1V

i nformation and shall be a text -based PDF. lithe redactions are acceptable, the redacted version

will 'be placed on we docket.

Signed March 29, 7017.

BY TILE COURT

District Judge David Nuf cr

12


United States District Court for the

District of Utah March 29, 2017

******MAILING CERTIFICATE OF THE CLERK******

RE: Bimbo Bakeries USA v. Sycamore et al 2:13cv749 DN-DBP

Charles A. Burke WOMBLE CARLYLE SANDRIDGE & RICE (WINSTON-SALEM) ONE W FOURTH ST WINSTON-SALEM, NC 27101

Raymond J. Etcheverry PARSONS BEHLE & LATIMER (UT) PO BOX 45898 SALT LAKE CITY, UT 84145-0898

Sean N. Egan PARKSIDE TOWER STE 950 215 S STATE ST SALT LAKE CITY, UT 84111-2374

Andrew G. Deiss DEISS LAW PC 10 W 100 S STE 425 SALT LAKE CITY, UT 84101

Christopher S. Hill KIRTON MCCONKIE PO BOX 45120 SALT LAKE CITY, UT 84145-0120

Eric C. Beach TONKON TORP LLP 888 SW FIFTH AVE STE 1600 PORTLAND, OR 97204

Aimee Trujillo,


United States District Courtf or the

District of UtahMarch 29, 2017

* *****MAILING CERTIFICATE OF THE CLERK******

RE: Bimbo Bakeries USA v. Sycamore et al2:13c\'749 DN-DBP

Charles A. BurkeWOMBLE CARLYLE SANDRIDGE & RICE (WINSTON-SALEM)ONE W FOURTI I STW1NSTON-SALEM, NC 27101

Raymond J. EteheverryPARSONS BEHLE Sz LATIMER (UT)PO BOX 45892SALT LAKE CITY. UT 84145-0898

Sean N. EganPARKSIDE TOWER STE 950215 S STATE STSALT LAKE CITY, UT 841 1 1-2374

Andrew G. DcissDEISS LAW PC1 0 W 100 5 STE 425SALT LAKE CITY, UT 84101

Christopher S. HillKIRTON MCCONKIFPO BOX 45120SALT LAKE CITY, UT 24145-0120

Eric C. BeachTONKON TORP I LP888 SW FIETI I AVE STE 160()PORTLAND, OR 97204

Aimee Trujillo,

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