Munters Corp. v. Matsui America, Inc.

Munters Corporation (plaintiff) registered the trademark “HoneyCombe” and used it for more than five years on a dehumidifier that featured a honeycomb-shaped, desiccant-wheel rotor. Munters learned that Matsui America, Inc. (Matsui) (defendant) was selling a Honeycomb Dehumidifying Unit that also contained a honeycomb-shaped, desiccant-wheel rotor. After receiving a cease-and-desist letter from Munters’s counsel, Matsui allegedly agreed to stop using “Honeycomb” as a trademark in its advertising materials but continued to use the word as an adjective to describe its rotor. Munters sued Matsui for trademark infringement. In defense, Matsui argued that there was no likelihood of confusion because Munters’s mark was merely descriptive. The district court entered a preliminary injunction restraining Matsui from infringing Munters’s “HoneyCombe” trademark in connection with the sale of Matsui’s dehumidifiers. In determining whether to order a permanent injunction, the district court found that Munters’s trademark was incontestable and, therefore, protectible because it had been in continuous use for more than five years. However, the court also determined that there was little likelihood of confusion between Munters’s and Matsui’s products, based partly on a strength-of-mark analysis. The court denied a permanent injunction. On appeal, Munters argued that the district court’s strength-of-mark analysis disregarded the rule that alleged infringement of an incontestable trademark cannot be defended on the ground that the mark is merely descriptive.