Opinion · Court of Appeals for the Fifth Circuit
Whirlpool v. Shenzhen Sanlida
Whirlpool v. Shenzhen Sanlida, 80 F.4th 536 (5th Cir. 2023)
- Type
- Opinion
- Court
- Court of Appeals for the Fifth Circuit
- Jurisdiction
- Federal
- Date
- 2023-08-25
- Topic
- intellectual-property-and-technology
How later courts describe this case
- “Rule 65(a) does not require service of process, but rather requires notice to the adverse party.”
- “Rule 65(a) does not require service of process, but rather requires notice to the 12 adverse party.” (citation modified)
- “[A]lthough we recognize that the public has an interest in encouraging commercial competition, the public also has an interest in the effective enforcement of our trademark laws.”
- “[A] preliminary injunction requires only notice, not perfected service of process.”
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Case: 22-40376 Document: 00516873137 Page: 1 Date Filed: 08/25/2023
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
____________ FILED
August 25, 2023
No. 22-40376 Lyle W. Cayce
____________ Clerk
Whirlpool Corporation; Whirlpool Properties,
Incorporated,
Plaintiffs—Appellees,
versus
Shenzhen Sanlida Electrical Technology Company,
Limited; Shenzhen Avoga Technology Company,
Limited,
Defendants—Appellants.
______________________________
Appeal from the United States District Court
for the Eastern District of Texas
USDC No. 2:22-CV-27
______________________________
Before Barksdale, Southwick, and Higginson, Circuit Judges.
Stephen A. Higginson, Circuit Judge:
Plaintiffs-Appellees Whirlpool Corporation and Whirlpool Proper-
ties, Inc., (collectively, “Whirlpool”) own various trademarks associated
with the iconic KitchenAid stand mixer, which they manufacture and sell.
Recently, Defendants-Appellants Shenzhen Sanlida Electrical Technology
Co., Ltd. and Shenzhen Avoga Technology Co., Ltd. (collectively, “Shen-
zhen”) introduced their own stand mixers into the market, primarily through
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No. 22-40376
online channels. Whirlpool promptly filed a complaint asserting federal- and
state-law claims for trademark and trade dress infringement along with a mo-
tion for a preliminary injunction to stop the sale of the allegedly infringing
mixers. After a hearing at which both parties were present, the district court
granted the injunction. In addition to its appeal, Shenzhen sought an emer-
gency stay pending appeal. After granting an initial administrative stay, we
denied that motion. And now, after considering the appeal on the merits, we
AFFIRM.
I.
For decades, the KitchenAid stand mixer, with its signature bullet-
shaped head, sloped neck, and sleek design, has been a staple on wedding
registries and the crown jewel in a home cook’s kitchen. Indeed, in 1992, the
U.S. Patent and Trademark Office (“PTO”) granted Whirlpool (which owns
the KitchenAid brand) registration of the three-dimensional KitchenAid
mixer design. 1 This design has been the subject of millions of dollars in
advertising spending across all media channels, appears prominently in
various cooking shows and is used by celebrity chefs, and has received
numerous accolades and awards.
Shenzhen, a China-based manufacturer, also manufactures and sells
stand mixers under the brand names “COOKLEE” and “PHISINIC.”
_____________________
1
Whirlpool has also registered a trademark as to the two-dimensional silhouette.
2
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Recently, Shenzhen launched a new stand mixer model that is the subject of
this lawsuit.
KitchenAid Stand Mixer COOKLEE Stand Mixer PHISINIC Stand Mixer
Accordingly, on January 31, 2022, Whirlpool filed a complaint against
Shenzhen for claims of trademark infringement and dilution, trade dress
infringement, and unfair competition under federal and state law. That same
day, Whirlpool filed a motion for a preliminary injunction prohibiting
Shenzhen from selling, distributing, advertising, or promoting the allegedly
infringing mixers.
On March 14, 2022, Whirlpool requested a preliminary injunction
hearing. In this motion, Whirlpool stated that Shenzhen had received actual
notice of the pending motion for a preliminary injunction, claiming that (1)
both Shenzhen companies’ legal representatives had accepted and signed for
the documents, (2) these same legal representatives had been notified via text
message to their confirmed cell phones, and (3) emails containing the
summons, complaint, and motion for a preliminary injunction had been sent
to the companies’ active email addresses. The motion was granted, and a
hearing before a magistrate judge was scheduled for April 19, 2022.
Counsel for both Whirlpool and Shenzhen attended the preliminary
injunction hearing. At the hearing, Shenzhen, which did not dispute that they
had received notice of the proceeding, argued that the preliminary injunction
should not be granted in the absence of service of process. Additionally,
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Shenzhen contended that the preliminary injunction should be denied
because Whirlpool’s trademarks are invalid because they are functional, and
there is no likelihood of confusion between KitchenAid and Shenzhen’s
stand mixers. The magistrate judge stated that he would take these
arguments under consideration, and then, later that day, issued a report and
recommendation in favor of granting the preliminary injunction.
On June 14, 2022, over objections from Shenzhen, the district court
adopted the magistrate judge’s report and recommendation and issued a
preliminary injunction. Shenzhen immediately appealed. The initial
preliminary injunction order required Shenzhen not to just immediately
cease, inter alia, importing, selling, promoting, and distributing their mixers,
but also to “recall and destroy and provide proof to the Court of recall and
destruction” of the allegedly infringing mixers.
Shenzhen filed an emergency motion to stay this order in the district
court. In addition to re-raising arguments as to service of process, the validity
of the trademark, and the likelihood of confusion, Shenzhen contended that
the district court erred in ordering the allegedly infringing mixers destroyed,
and in failing to order Whirlpool to post bond in connection with the
preliminary injunction pursuant to Federal Rule of Civil Procedure 65(c).
The magistrate judge, after a more detailed analysis as to factors justifying a
preliminary injunction, recommended denying the motion to stay, although
he also recommended that the injunction be modified to require Shenzhen
only to recall and hold (rather than recall and destroy) the allegedly infringing
mixers and that Whirlpool be ordered to post a bond in the amount of
$10,000. On August 12, 2022, the district court, again over Shenzhen’s
objection, adopted this report and recommendation.
On September 2, 2022, Shenzhen filed an opposed emergency motion
for a stay of the preliminary injunction pending appeal in our court. On
4
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September 12, our court granted an administrative stay. On October 12,
however, our court ordered that the administrative stay be lifted and
Shenzhen’s opposed motion for a stay pending appeal be denied.
Accordingly, the district court’s preliminary injunction has remained in
effect while this appeal was pending. We now address the merits of that
appeal.
II.
A.
First, Shenzhen contends that the district court lacked the power to
enter a preliminary injunction because, in the absence of either completed
service of process under the Hague Convention or a voluntary appearance,
the district court had not yet acquired personal jurisdiction over it. Yet
Federal Rule of Civil Procedure 65 states that a court “may issue a
preliminary injunction only on notice to the adverse party.” FED. R. CIV. P.
65(a)(1) (emphasis added). In other words, as we stated in Corrigan Dispatch
Co. v. Casa Guzman, S.A., “Rule 65(a) does not require service of process,”
but rather requires “notice to the adverse party.” 569 F.2d 300, 302
(5th Cir. 1978). Here, there is no dispute that Shenzhen received sufficient notice of the motion for a preliminary injunction—indeed, Shenzhen appeared at and participated in the preliminary injunction hearing. See Harris Cnty. v. CarMax Auto Superstores, Inc.,177 F.3d 306, 325
(5th Cir. 1999) (explaining
that Rule 65’s “notice requirement necessarily requires that the party
opposing the preliminary injunction has the opportunity to be heard and to
present evidence”).
Shenzhen does not address Corrigan, but instead relies on Enterprise
International, Inc. v. Corporacion Estatal Petrolera Ecuatoriana for the
proposition that Rule 65 merely prescribes the means for issuing an
injunction and has no bearing on the court’s jurisdiction to exercise such
5
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power. 762 F.2d 464, 470
(5th Cir. 1985). Specifically, Shenzhen reads Enterprise to require that a district court must have “both subject matter jurisdiction and in personam jurisdiction over the party against whom the injunction runs,” which, where the party is the defendant, requires either a voluntary appearance or effective service of process.Id.
(internal quotation
marks and citation omitted).
In Enterprise, one of the defendants (the official state-operated oil
company of the Republic of Ecuador) challenged the district court’s ability
to exercise personal jurisdiction over it pursuant to the Foreign Sovereign
Immunities Act, 28 U.S.C. § 1605
. Enterprise,762 F.2d at 465, 470
. In other words, the defendant in Enterprise argued that the district court would never have personal jurisdiction over it. In this scenario, we found it error for the district court to “postpone[] any consideration of the issue of personal jurisdiction” before issuing the preliminary injunction.Id. at 471
. We explained, “Where a challenge to jurisdiction is interposed on an application for a preliminary injunction[,] ‘[t]he plaintiff is required to adequately establish that there is at least a reasonable probability of ultimate success upon the question of jurisdiction when the action is tried on the merits.’”Id.
(quoting Visual Scis., Inc. v. Integrated Commc’ns Inc.,660 F.2d 56
, 59 (2d Cir.
1981)).
But here, and unlike the defendant in Enterprise, Shenzhen does not
dispute that once service is effectuated, personal jurisdiction will exist.
Instead of arguing that the district court will never have personal jurisdiction,
Shenzhen contends that the district court simply had to wait until service of
process was perfected before ordering any, even emergency, relief. Yet,
because “formal service of process under the Hague Convention . . . can take
months,” adopting Shenzhen’s position could result in the “unfortunate
effect of immunizing most foreign defendants from needed emergency
injunctive relief.” H-D Mich., LLC v. Hellenic Duty Free Shops S.A., 694 F.3d
6
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827, 842 (7th Cir. 2012). And, as already noted, Shenzhen’s position directly
contradicts both the plain text of Rule 65 and our precedent as established in
Corrigan. Accordingly, we find that the district court did not err in
concluding that a preliminary injunction requires only notice, not perfected
service of process.
B.
Additionally, Shenzhen contends that the district court abused its
discretion in granting the preliminary injunction. For issuance of the
preliminary injunction to be proper, Whirlpool had to show:
(1) a substantial likelihood of success on the merits, (2) a substantial
threat of irreparable injury if the injunction is not issued, (3) that the
threatened injury if the injunction is denied outweighs any harm that
will result if the injunction is granted, and (4) that the grant of an
injunction will not disserve the public interest.
Speaks v. Kruse, 445 F.3d 396, 399-400
(5th Cir. 2006) (citation omitted). We review “the grant or denial of a preliminary injunction for abuse of discretion, with any underlying legal determinations reviewed de novo and factual findings for clear error.” Topletz v. Skinner,7 F.4th 284, 293
(5th Cir. 2021).
i.
We begin with the first factor—likelihood of success on the merits. To
obtain an injunction for a claim of trademark infringement, a party must show
that it (1) possesses a valid trademark and (2) that the defendant’s products
create a likelihood of confusion as to source, affiliation, or sponsorship. Nola
Spice Designs, LLC v. Haydel Enters., Inc., 783 F.3d 527, 536
(5th Cir. 2015) (citing Nat’l Bus. Forms & Printing, Inc. v. Ford Motor Co.,671 F.3d 526, 532
(5th Cir. 2012)).
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a.
Here, Whirlpool has a registered design mark as to the KitchenAid
mixer, specifically its exterior styling. “[P]roof of the registration of a mark
with the PTO constitutes prima facie evidence that the mark is valid,”
although “[t]his presumption of validity may be rebutted.” Amazing Spaces,
Inc. v. Metro Mini Storage, 608 F.3d 225, 237
(5th Cir. 2010) (citations
omitted). 2 Nonetheless, Shenzhen contends that that this mark is invalid as
functional because the parts of the mixer (which Shenzhen describes as “a
mixer head, an L-shaped pedestal[] including a base portion and an
upstanding support arm”) are required for the mixer to work.
“The Supreme Court has recognized two tests for determining
functionality.” Bd. of Supervisors for La. State Univ. Agric. & Mech. Coll. v.
Smack Apparel Co., 550 F.3d 465, 485
(5th Cir. 2008). First, the Court has
held that “‘a product feature is functional,’ and cannot serve as a trademark,
_____________________
2
To the extent that Whirlpool’s claims are predicated on unregistered trade dress
rights in the shape of the KitchenAid stand mixer, “[i]t is well established that trade dress
can be protected under federal law” and that the design of a product “may acquire a
distinctiveness which serves to identify the product with its manufacturer or source.”
TrafFix Devices, Inc. v. Mktg. Displays, Inc., 532 U.S. 23, 28
(2001); see also Amazing Spaces, Inc.,608 F.3d at 251
(“Trade dress refers to the total image and overall appearance of a product and may include features such as the size, shape, color, color combinations, textures, graphics, and even sales techniques that characterize a particular product.” (citation omitted)). When this occurs, much like a trademark, the trade dress “may not be used in a manner likely to cause confusion as to the origin, sponsorship, or approval of the goods.” TrafFix,532 U.S. at 28
. We apply the same analysis as to a claim for trade dress infringement as we do to a claim for trademark infringement. See Blue Bell Bio-Medical v. Cin-Bad, Inc.,864 F.2d 1253, 1256
(5th Cir. 1989) (describing the two-step analysis to
resolve a claim for trade dress infringement, noting that “[t]he first question is whether the
product’s trade dress qualifies for protection” and that the second question is whether that
dress has been infringed, which occurs when there is a likelihood of confusion between the
competing products).
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‘if it is essential to the use or purpose of the article or if it affects the cost or
quality of the article.’” TrafFix Devices, Inc. v. Mktg. Displays, Inc., 532 U.S. 23, 32
(2001) (quoting Qualitex Co. v. Jacobson Prods. Co.,514 U.S. 159, 165
(1995)). Here, nothing in the record demonstrates that the exterior styling of the mixer is “the reason the device works.” 3 See Eppendorf-Netheler-Hinz GMBH v. Ritter GMBH,289 F.3d 351, 355
(5th Cir. 2002) (quoting TrafFix,532 U.S. at 34
). Moreover, there are numerous competing products in the
market, including some produced by Shenzhen. Notably, there is no showing
in the record that the specific shape of the mixer head or slope of the stand
otherwise affects the cost, quality, or function of these competitors as would
be required to demonstrate functionality.
The second test for functionality looks less to use, and more to
competition, stating that “a functional feature is one the exclusive use of
which would put competitors at a significant non-reputation-related
disadvantage.” Smack Apparel, 550 F.3d at 486
(citation omitted). But again, the presence of competing products with other design motifs cuts against this argument. And, critically, these other designs are “equally usable” even if potentially less desirable or aesthetically pleasing. See Qualitex,514 U.S. at 166
. KitchenAid’s design mark and trade dress cover “ornamental, incidental, or arbitrary aspect[s] of the device,” and are accordingly not functional. See TrafFix,532 U.S. at 30
.
_____________________
3
Shenzhen’s reliance on a (now expired) 1939 utility patent detailing the internal
mechanics of the mixer and a 2018 utility patent for a damper mechanism on the stand to
demonstrate functionality is misplaced. Although a “utility patent is strong evidence that
the features therein claimed are functional,” TrafFix, 532 U.S. at 30
, the mark and trade
dress at issue concern the external decorative features, not the claim elements contained
within the patent.
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In sum, we do not find clear error with the district court’s finding that
KitchenAid’s registered mark (or the associated trade dress), which covers
the exterior design of the mixer, is not functional and is therefore a valid
mark, satisfying the first requirement.
b.
Shenzhen also contends that the district court erred in granting the
preliminary injunction because, in Shenzhen’s view, there is no likelihood of
confusion between its products and the KitchenAid mixer, the second factor.
When assessing the likelihood of confusion, we consider the following non-
exhaustive elements, also known as the “digits of confusion”:
(1) the type of mark infringed, (2) the similarity between the
marks, (3) the similarity of the products, (4) the identity of the
retail outlets and purchasers, (5) the identity of the advertising
media used, (6) the defendant’s intent, (7) evidence of actual
confusion, and (8) the degree of care exercised by potential
purchasers.
Future Proof Brands, L.L.C. v. Molson Coors Beverage Co., 982 F.3d 280, 289
(5th Cir. 2020) (citation omitted). “A finding of a likelihood of confusion need not be supported by a majority of the digits,” and district courts may weigh the digits on a case-by-case basis, “depending on the particular facts and circumstances involved.”Id.
(cleaned up).
Again, we review the district court’s factual determination as to the
likelihood of confusion for clear error. 4 Rolex Watch USA, Inc. v. Meece, 158
_____________________
4
Neither the initial report and recommendation nor the first preliminary injunction
order contained an analysis as to the “digits of confusion.” Although the failure to give due
consideration to the “digits of confusion” could have been in error, see Rolex Watch USA,
Inc. v. Meece, 158 F.3d 816, 831
(5th Cir. 1998) (“The district court erred by failing to
10
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, 829 (5th Cir. 1998). As noted above, the allegedly infringing mixers
have similar slopes and geometries, are sold to similar purchasers (namely,
they are sold for personal, rather than commercial, use), and are marketed in
the same or similar channels (specifically, online retailers). It is true, as
Shenzhen notes, that other factors may support that there is no confusion—
for instance, Shenzhen’s mixers have other distinguishable features, like
additional nobs or visible branding. Nevertheless, that there is a debate as to
how to weigh the elements is not enough for us to find clear error in the
district court’s determination that this factor ultimately went in Whirlpool’s
favor.
ii.
Having addressed the question of Whirlpool’s likelihood of success on
the merits, we briefly discuss the remaining three factors—the threat of
irreparable injury, the balance of harms, and the public interest. 5
Under the Lanham Act, a plaintiff seeking a preliminary injunction
against infringement “shall be entitled to a rebuttable presumption of
_____________________
consider and weigh all of the digits of confusion.”), the second report and recommendation
(addressing Shenzhen’s motion to stay the preliminary injunction) explicitly addressed
several of these factors, specifically the nature of the marks, the similarities between the
mixers, and the overlap between the markets for the products, and found that they all
supported the conclusion that there is a likelihood of confusion.
5
Although Shenzhen did not challenge these elements as to the original report and
recommendation, we note that it did raise these issues in its motion to stay the preliminary
injunction. Because the report and recommendation (later adopted by the district court) as
to the motion to stay addressed these objections before modifying the preliminary
injunction to the current operative order, we find it appropriate to address these challenges
on appeal. We do not find that Shenzhen is “raising [these arguments] for the first time on
appeal” such that it is forfeited. Thomas v. Ameritas Life Ins. Corp., 34 F.4th 395, 402
(5th
Cir. 2022) (citation omitted).
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irreparable harm . . . upon a finding of likelihood of success on the merits.”
15 U.S.C. § 1116
; see also Nichino Am., Inc. v. Valent U.S.A. LLC,44 F.4th 180, 183
(3d Cir. 2022) (explaining how the Trademark Modernization Act
of 2020 created a rebuttable presumption of irreparable harm for plaintiffs
who have shown a likelihood of success on the merits of their infringement
claim). In attempting to rebut this presumption, Shenzhen alleges, for the
first time on appeal and without any factual support, that their products and
KitchenAid’s mixers have coexisted in the market for years and that
Whirlpool’s delay in bringing an enforcement action necessarily shows the
lack of any such harm. Even assuming this argument is properly raised, we
do not find it convincing, let alone enough for us to find that the district court
abused its discretion in finding that the second factor weighed in favor of
Whirlpool.
We similarly find no abuse of discretion as to the district court’s
finding on the balance of harms. Shenzhen lists the harms resulting from the
preliminary injunction as primarily the loss of the use of their own markets to
sell their own products, resulting in “loss of market shares, immediate and
almost complete loss of revenue stream from the sale of products,
interruption of the normal course of business . . . and loss of invested capital.”
Such harms are pecuniary in nature, and thus presumptively reparable. See
Janvey v. Alguire, 647 F.3d 585, 600
(5th Cir. 2011) (“In general, a harm is
irreparable where there is no adequate remedy at law, such as monetary
damages.”). Accordingly, the balance of harms weighs in favor of Whirlpool
and its presumption of irreparable harm.
Finally, although we recognize that the public has an interest in
encouraging commercial competition, the public also has an interest in the
effective enforcement of our trademark laws. See Eli Lilly & Co. v. Nat.
Answers, Inc., 233 F.3d 456, 469
(7th Cir. 2000) (“Finally, the public interest
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is served by the injunction because enforcement of the trademark laws
prevents consumer confusion.” (citation omitted)).
Therefore, the district court did not abuse its discretion in granting
the preliminary injunction.
III.
For the foregoing reasons, we AFFIRM.
13