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Beltronics USA v. Midwest Inventory Distribution

562 F.3d 1067 (2009)

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Beltronics USA v. Midwest Inventory Distribution

United States Court of Appeals for the Tenth Circuit

562 F.3d 1067 (2009)

Facts

Beltronics USA, Inc. (Beltronics) (plaintiff) manufactured radar detectors and sold them to authorized distributors who agreed to resell them at specified minimum prices. Certain distributors sold Beltronics radar detectors to Midwest Inventory Distribution, LLC (Midwest) (defendant) in violation of their distribution agreements with Beltronics, and Midwest resold the detectors on eBay. To conceal the contract violations, the distributors either replaced the serial-number labels on the radar detectors with phony ones or removed the labels altogether before shipping them to Midwest. If Midwest discovered that it had received a radar detector bearing an original serial-number label, Midwest removed the label before reselling the detector. Beltronics learned that its products were being sold without original serial-number labels when it received customer requests for warranty service on merchandise with phony serial numbers. Beltronics had a policy of providing warranty coverage, software updates, and other benefits only to purchasers of Beltronics products bearing original serial-number labels. Customers who purchased Beltronics radar detectors from Midwest expressed confusion and anger because they had not received what they thought they were buying. Beltronics sued Midwest for federal trademark infringement. The district court entered a preliminary injunction barring Midwest from selling any Beltronics products not bearing an original serial-number label, and Midwest appealed.

Rule of Law

Issue

Holding and Reasoning (Tacha, J.)

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