Storage companies in one of ‘largest ever’ trademark settlements
US storage rental company U-Haul has agreed to pay storage business PODS Enterprises $41.4 million, in what is claimed to be one of the largest-ever out-of-court settlements in a trademark case.
PODS Enterprises sued U-Haul at the US District Court for the Middle District of Florida in July 2012 for trademark infringement.
PODS Enterprises owns four trademarks at the US Patent and Trademark Office (USPTO) for the term ‘Pods’. They were registered in July 2000, November 2005, August 2009 and September 2009.
U-Haul rebranded the U-Box, a portable container which helps customers transport goods, with the use of the ‘Pods’ name.
In its 2012 suit, PODS Enterprises alleged that U-Haul “embarked on a plan” to capitalise on PODS Enterprises’ “goodwill” by using the ‘Pods’ mark throughout its advertising and marketing materials to “unlawfully” attract business and sales.
PODS Enterprises asked U-Haul to “cease and desist” from misusing its rights, but the storage company “refused to comply”, according to the lawsuit.
Further, PODS Enterprises argued that U-Haul infringed its trademarks, conducted unfair competition, committed trademark dilution and common law trademark infringement.
In 2014, a jury ruled that U-Haul must pay PODS Enterprises $60 million in damages, after it found in favour of PODS Enterprises on all counts.
In August 2015, Judge James Whittemore of the Middle District of Florida granted PODS Enterprises a permanent injunction against U-Haul from using the ‘Pods’ term.
Whittemore also ordered U-Haul to pay PODS Enterprises $4.9 million in pre-judgment interest.
U-Haul appealed against the decision and was due to deliver oral arguments in September this year at the US Court of Appeals for the Eleventh Circuit, but before this could happen, the companies settled out of court.
They agreed that U-Haul will pay PODS Enterprises $41.4 million in damages.
U-Haul also agreed that the permanent injunction put in place by the district court “remains in full effect” and that it would not directly or indirectly challenge the validity of PODS Enterprises’ trademarks.
Charles Cantine, a partner at law firm Stroock and who represented PODS Enterprises, said: “This was one of the largest trademark verdicts ever and the settlement reflects that. In addition, the permanent injunction entered by the court remains in place.”
Cantine told WIPR: “Certainly the underlying verdict is one of the largest ever and we’ve taken a look at the settlements that were available and we didn’t find any that were larger.
“We’ve done some research and we’re not aware of any settlements that were larger in this context.”
Another out-of-court trademark settlement, which took place in China between Apple and China-based firm Proview, saw Apple agree to pay $60 million.
The case surrounded the rights to the name ‘iPad’, to which Proview claimed it owned the rights. Apple disputed the claims and alleged that it owned the rights to the term.
A spokesperson for U-Haul declined to comment.
