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Eureka! Pet Food, Inc. v. Ross-Wells, Inc.

United States District Court, W.D. Washington, Seattle

April 15, 2019

ROSS-WELLS INC, Defendant.



         The above-entitled Court, has received and reviewed:

1. Ross-Wells, Inc.'s Motion for Summary Judgment (Dkt. No. 33), Eureka! Pet Food, Inc.'s Response in Opposition to Ross-Wells Inc.'s Motion for Summary Judgment (Dkt. No. 46), and Reply to Ross-Wells, Inc.'s Motion for Summary Judgment (Dkt. No. 48); and
2. Eureka! Pet Food, Inc.'s Motion for Partial Summary Judgment (Dkt. No. 38), Ross-Wells, Inc.'s Response to Eureka!'s Motion for Summary Judgment (Dkt. No. 42), and Eureka! Pet Food, Inc.'s Reply in Support of Motion for Partial Summary Judgment (Dkt. No. 49); and

         all attached declarations and exhibits, and relevant portions of the record. Finding oral argument is not necessary to arrive at a decision, the Court rules as follows:

         IT IS ORDERED that Defendant's motion for summary judgment is PARTIALLY GRANTED and PARTIALLY DENIED: Plaintiff's claims for breach of contract, unjust enrichment, violations of the Wisconsin Deceptive Trade Practices Act, and tortious interference with business relations are DISMISSED with prejudice. Defendant's motion for summary judgment on Plaintiff's trademark infringement claims is DENIED.

         IT IS ORDERED that Plaintiff's motion for partial summary judgment is DENIED.


         Defendant Ross-Wells, Inc. (“Ross-Wells”) is a Wisconsin meat processing and animal feed company. In the late 60's, the owners of the company developed a pet food formula combining fresh meat and a blend of vitamins and minerals. Known as “premix, ” the formula (which has been altered over time but remained essentially the same for 50 years) is the foundation of many pet foods offered by Ross-Wells, including dog food.

         In 1989, Ross-Wells began shipping a version of premix developed for a local “musher” (sled team driver) to a man in Alaska named Winston Hobgood, who resold it to Alaska mushers. Over time, Winston requested that additional ingredients (e.g., liver, corn oil, bone meal) be added to the premix. (A declaration from Ross-Wells' plant manager - unchallenged by Plaintiff - indicates that Winston also adopted some revisions suggested by Ross-Wells; see Dkt. No. 37, Decl. of Kleifgen at ¶ 9). Around 1993, Winston began repackaging the product under the brand name “Eureka!.” Winston printed his own Eureka! packaging materials, shipped them to Ross- Wells, and the company packaged Winston's version of their premix formula in the Eureka! materials. At that point, Ross-Wells began rebating their savings (the result of not having to use their own packaging materials) to Winston, calling it a “commission.” The rate varied and - like the rest of their business relationship with Winston - the arrangement was never reduced to writing.

         The division of labor saw Ross-Wells responsible for manufacturing the special-order premix and packaging it (using Winston's “Eureka!” materials) while Winston coordinated transport from Ross-Wells' Medford, WI plant to Alaska, consulted on dog-related issues and generated a small number of sales leads in the lower 48 states. In 2009, Winston trademarked the Eureka! name and the next year formed a Eureka! business entity. He was the only member of the organization, never had any employees, and never had his own manufacturing facilities.

         Although Winston died in 2014, it was not until months later that Ross-Wells was made aware of his passing. Ownership of Eureka! Pet Food eventually passed (after protracted litigation) to Winston's children, Rhonda and Joel. In December 2014 (before the ownership issue had been settled), Rhonda and Joel visited the Medford plant with the intention of continuing to build on the relationship their father had created with Ross-Wells. The relationship did not get off to a good start (Ross-Wells took exception, for instance, to Rhonda's assertion that her father had “invented” the dog food formula being sold as Eureka! pet food), and things were really never the same after Winston's death. Rhonda and Joel did not bring the level of experience or expertise to the business which their father had possessed - they had no experience in dog-related issues, animal nutrition or pet-food manufacturing, did not continue their father's practice of supplying Eureka! packaging to Ross-Wells, and did nothing over the course of their relationship with Ross-Wells other than maintain the Ross-Wells website and monitor customer-response emails.

         For six months following Winston's death, Ross-Wells sent Rhonda a commission check utilizing the rate at the time of Winston's passing (6%, less the cost of packaging materials Ross-Wells has purchased to replenish the Eureka! inventory), despite the fact that the children were not providing the same of level of services their father had (i.e., providing neither Eureka! packaging to Ross-Wells nor consulting on issues concerning dog feeding/nutrition). In February 2015, however, Ross-Wells co-owner Robert Wells advised Eureka! that the commission would need to be renegotiated for those reasons. Between July 2015 and July 2017, Ross-Wells sent Rhonda five biannual commission checks (totaling $22, 237.82) accompanied by a reconciliation statement which reflected the total amount of Eureka! product manufactured, multiplied by the new commission rate (1.5%). Rhonda cashed all five checks.

         In July 2017, Ross-Wells received a cease-and-desist letter from Eureka!'s attorney, terminating the business relationship and giving Ross-Wells 21 days to (1) cease using Eureka!'s name on their packaging and (2) turn over Ross-Wells' formulas and customer lists as “trade secrets.” Ross-Wells responded by letter through their counsel, disputing the “trade secrets” claim. Additionally, Ross-Wells advised Eureka! that the company still had $7600 worth of Eureka! packaging in stock and indicating that (a) Eureka! could purchase it from them or (b) Ross-Wells would utilize the Eureka! materials until they were depleted and then begin packaging under a new trade name. Eureka! never responded to the letter. For two months, Ross-Wells used the packaging “as is” (i.e., without obscuring the “Eureka!” name); thereafter, the company began pasting labels over the Eureka! name on the boxes with their new product names (“Titan Red” and “Titan Blue”) and turning the bags with the Eureka! logo inside out. Ross-Wells also emailed its customers and advised them of the new “Titan” product name and why the name change was necessary. As of November 2017, the company was no longer utilizing the Eureka! materials.

         In that same month, Eureka! filed suit against Ross-Wells. The initial lawsuit alleged liability for trade secrets violations, but that claim was abandoned in the Second Amended Complaint. In January 2018, Eureka! mass-emailed 1400 addresses culled from the website it had maintained for Ross-Wells, announcing new production facilities and a new product. Although Eureka! began accepting orders immediately, the company did not actually begin delivering product until May 2018.


          Standard of review

         “The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). The moving party is entitled to judgment as a matter of law when the nonmoving party fails to make a sufficient showing on an essential element of a claim in the case on which the nonmoving party has the burden of proof. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1985). There is no genuine issue of fact for trial where the record, taken as a whole, could not lead a rational trier of fact to find for the non moving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986) (nonmoving party must present specific, significant probative evidence, not simply “some metaphysical doubt.”); Fed.R.Civ.P. 56(e). Conversely, a genuine dispute over a material fact exists if there is sufficient evidence supporting the claimed factual dispute, requiring a judge or jury to resolve the differing versions of the truth. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 253 (1986); T.W. Elec. Service Inc. v. Pacific Electrical Contractors Association, 809 F.2d 626, 630 (9th Cir. 1987).

         Defendant has moved for summary judgment on all of Plaintiff's claims; the Court will examine them in turn. The final section (“Trademark infringement”) includes an analysis of both Defendant's and Plaintiff's motions for summary judgment on this cause of action. Breach of contract/unjust enrichment It is undisputed that this ...

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