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Last updated - July 6, 2012

3:09-cv-02390-F
M3Girl Designs LLC v. Blue Brownies LLC et al


DAY 2 : Tuesday, June 19, 2012

Pre-Trial Hearing
During Opening Statements on Monday, Hemingway attempted to introduce "evidence" that the Defendants had already admitted that the Plaintiffs had a lawful trade dress claim. To support this assertion, Hemingway displayed paragraphs from the Second Amended Complaint Response filed by the Defendants where the response admitted the trade dress claims made by the Plaintiffs.

Hanor objected and Judge Royal Furgeson said he wanted written arguments from both sides that evening. I was under the impression that the issue was being resolved Monday evening but it was not. It was set for a 8:30 hearing in court. I was not inside the courtroom when it began and I was reluctant to enter after I realized what was happening. But I could hear parts of the discussion through the closed courtroom door. On one occasion Hemingway turned away with a look of total frustration.

Judge Royal Furgeson stated that there was no precedent so he was making a ruling and that Hemingway was not to go there anymore with the attempts to use filings with typographical errors. Apparently Hemingway had done something wrong, either that morning or during the previous day's session (Monday) because the judge said he was verbally sanctioning Hemingway. The pre-trial session end around 8:55am.

Time 9 am Continuation of First Witness for the Plaintiffs: Diane Bradshaw
Diane Bradshaw resumed testifying. The judge warned Hanor about not touching the exhibits belonging to the Plaintiffs. One of the display boards appeared to be in the way and Hanor requested it be moved. Denied. Hemingway explained to the witness that although the information on the screen was in evidence, they needed to get it read into the record for the next audience, which could be a court of appeals. Was the information displayed true and accurate? Yes, it was. Go over it for the written record. So Diane Bradshaw went over the financial numbers for m3 girl designs for 2006, 2007, 2008, 2009, 2010, 2011 and 2012. Was there a market contraction? yes. What if any impact did it have. A huge impact during 2009 to 2012 when competition entered the market.

Objection Hypothethical. Denied.

What is your primary competition now? Blue Brownies. They lost a tremendous amount of sales because of Blue Brownies.
At this point the judge warns Hemingway that the Plaintiff must provide underlying evidence to Defendant's counsel. He must make documents available to Hanor. The judge, Hemingway and Hanor briefly debate paperwork. Judge admits miscellaneous documents into evidence (no objection from Defendants).

"Lap Desk" order form for personalized article is displayed. Diane Bradshaw claimed they had no early records for the bottle cap jewelry business. Reminds her that testimony is limited to 2006 through January 2009. He then asked her to describe "point of sale" information. Brochures were placed next to the displays. They gave some 1500 brochures to the Kline Group and close to 1100 to other stores. Were your trademarks and trade dress prominently displayed? Yes. Displays were near checkouts because the choker bottle cap necklaces were an impulse item. (The Plaintiffs repeated the near checkout and "impulse" phrasing two more times to make sure it stuck.) And the bottle cap displays was always with choker necklaces? Yes.

How many signings did they have in 2008? Three. At all three of them were your trademarks and trade dress prominently displayed? Yes. Along with a banner that had their name on it. In 2009? Eleven interviews, on-line and editorial. And they were put on the web site? Yes. At all of the interviews were your trademarks and trade dress prominently displayed? Yes. (Diane Bradshaw comes across as being very well rehearsed for her day in court.) And the TV interviews - were your trademarks and trade dress prominently displayed? Yes. And the interviews were on the web site as well as YouTube. And these interviews - were your trademarks and trade dress prominently displayed? Yes. (It appears the Plaintiffs had developed a mantra that they were going to repeat, and repeat and repeat with hopes that it would influence the thinking of the jury.)

How many "market centers" did you get into in 2008 and before? Six: Dallas, Atlanta, Jackson Mississippi, New York, Los Angeles and Little Rock. And your trademarks and choker necklace trade dress were prominently displayed? Yes. Trade shows? Thirty cities. And your trademarks and choker bottle cap necklace trade dress were prominently displayed? Yes. Awards? Learning Express gave them two awards and one was for "Pick The Styles". Hemingway cautioned her that they were not getting into the artwork inside the bottle caps.

The Bromley Group was then mentioned as to having an article about their company. The Bromley Group was promoting their company. It is a PR firm. And your trademarks and choker bottle cap necklace trade dress were prominently displayed? Yes.

Hemingway then referred her to specific exhibits and asked her to explain the exhibits before they were shown to the jury. (Note - evidence has to be introduced through a witness who can testify as to the validity of the exhibit that is why Diane Bradshaw was asked to explain each exhibit.) Starting with #216a. Diane Bradshaw said it was an advertising brochure. Is it a true and accurate copy? Yes. Hemingway shows the brochure to Hanor who says to the judge, no objection. The judge admits #216a into evidence. It is the displayed on the projection screen. There are three pictures on the brochure.

The same procedure was followed for ten more exhibits. All of which were either articles about m3 girl designs or screen shots of interviews. At the end of these exhibits, Hemingway again asked, in all of these articles, your trademarks and choker bottle cap necklace trade dress were prominently displayed? Yes.

Time 10:07 am 15 minute break

Time 10:22 pm Questioning of Diane Bradshaw Continues.

Exhibit #32a was shown to Diane Bradshw. It was a screen shot from a video showing Maddie Bradshaw talking to a grade school class. It was News Channel 4 in Oklahoma City. Admitted. Your trademarks and choker bottle cap necklace trade dress were prominently displayed? Yes.

Exhibit 220a was submitted and admitted. A summary of miscellaneous expenses for m3 girl designs. In 2006 and 2007 expenses were zero. In 2008, there were commissions to the Kline Group of $54, 620. In 2009, expenses ran some $16, 614. Were these for advertising and trademark?

Objection Lack of knowledge. Overruled.

There was nothing like our jewelry in the stores. Was anyone else out there offering the same trade dress as you? No. Now, let us move on to 2009 and later. There were nine television shows, 44 advertisements and 5,100 brochures distributed.

Objection Relevance. Overruled.

The main advertisements and television shows are on the web site. How much of an impact has the internet had on your business. Tremendous.

Objection 2009 does not apply to secondary meaning.

At this point, Judge Royal Furgeson addressed the jury, telling them there were two issues here. The first was whether the claimed trade dress has acquired secondary meaning before January 2009. Evidence after that date can be considered as it applies to confusion. Overall, Judge Furgeson did a fine job of keeping the jury informed of the issues and explaining to them what was happening.

Hemingway: Your trademarks and choker bottle cap necklace trade dress were prominently displayed on television broadcasts? Yes. How many trade shows did you go to after 2008? 86 trade shows. He then introduces Exhibit 15, a screen shot of a TV interview. This was followed by 13 more still photos (screen shots) of various TV interviews, all of which were admitted into evidence.

Time 11:18am 15 minute break

Time 11:30 pm Questioning of Diane Bradshaw Continues.

21 more exhibits were introduced of interviews, trade shows and such. (The emphasis appeared to be to tout the celebrities and not so well known people who either appeared at the trade shows or who were on the various television shows, as though the fact they were well-known, more moderately known, or mostly unknown, gave any credibilty to the trade dress claims. It seemed to be an attempt to justify by association. It went on and on like this. Dig us because these people have! Right.)

Time 12:20 pm Lunch break

Time 1:40 pm Questioning of Diane Bradshaw Continues.

(It is somewhat remarkable that the jury stayed focused throughout the trial. Considering the amount of redundant exhibits and testimony, none of which established secondary meaning, at no time did I see any juror appear to be bored, uninterested or sleepy. This trial had a good jury.)

The Plaintiffs continued with exhibits about advertising and merchandising. Then they shifted to the number of employees m3 girl designs had. In 2006 and 2007, there were zero employees except for the three of them. In 2008, they had 12 employees. In 2009 and 2010, they had 31 employees. Now, it was just the three of them again. Was that tough on you? Yes. They were laid off. The payroll just was not there. Hemingway then handed her Exhibit #203c, which was identified as the m3 girl designs handbook.

Objection Relevance?. It is an internal business document, not advertising. Overruled.

Exhibit #210, which was actually two exhibits, was shown to Diane Bradshaw, It was two invoices from Learning Express.

Objection Relevance? Allowed in.

She was asked if those were true and accurate copies? They were. When asked how did this advance issues, Hemingway replied that he had no more invoices to introduce. He asked Diane Bradshaw how many stores did they sell to? 2500. He pointed at a large box on the floor? All in boxes just like this one? Yes. He then submitted the remainder of a folder, Exhibit #216, which was identified as design documents.

Objection They should not be admitted as a single document. Allowed in.

They were identified as brochures, catalogs and publications. Hemingway puts a display board up for the jury. How many choker necklaces had they sold in six years? 855,000. (While this number appears to be fantastic, it computes to $6.04 wholesale per choker necklace with one bottle cap magnet attached, based upon a claimed six-year revenue of $5,160,500 by m3 girl designs. That is if you believe that they always sold them as a set.) She was then asked to compare their choker necklaces to those sold by Blue Brownies. She said the Blue Brownies chokers were too small and hazardous to kids.

Objection She is not qualified to testify about the safety of another product. It is not fair to allow her to safety issues. Judge Royal Furgeson that he decided what was fair and what was unfair, not the attorneys. He stated that there was no reference to her being qualified but he was going to let her testify but that he was uncomfortable with testimony about whether or not another product is safe or not. He strikes the last statement of the witness.

Diane Bradshaw was then asked how m3 girl designs made their chokers. They used a measuring device to make sure they were not too small. They tried on every necklace to insure they complied with safety regulations. Was the m3 girl designs sample choker necklace shown compliant with the measuring device? Yes. Was the Blue Brownies sample choker necklace shown compliant? No. Would you have allowed that choker to be sent out? The judge told Hemingway that he could not ask that question.

Exhibit #1 was then shown to the jury. It was the trademark registration for SNAP CAPS file by m3 girl designs. Did m3 girl designs file a patent application? Yes. Exhibits #269 and #270 are admitted. She was referred to page 5 of one of the patent application responses, Claim 12, where is said, "non-functional descriptive material". What was her understanding of what that means?

Objection She is not qualified on patent issues. She can state her understanding of what it means. But there will be no testimony from her as to what it means.

It was her understanding that the Patent Office was saying that their trade dress, the choker necklace, was non-functional. Was there another response from the Patent Office? Yes. It was the same as the first one.

They then moved to the subject of monitoring competition. Was there any real competition at the start? No, it began in 2008. And you were using the exact same trade dress as shown here? Yes. They sent out four cease and desist letters, most stopped. How many other C&D letters did you send out? 27. Exhibits #232 and #233 were shown to her. They were identified as C&D letters sent to Blue Brownies. How did you monitor competition? She used the internet and did Google searches. She then had an attorney write the letters and any follow-up letters. What kind of responses did you get? Most stopped selling their trade dress right away. The had had to start legal action in only a few cases.

February 13, 2009, was the first letter to Blue Brownies. He reads "For instance, you and your company are selling" similar designs, etc. What happened? They got no response. May 15, 2009, was the second letter. Why didn't you sue right away? They were trying to give people a chance to correct their behavior. And legal action is expensive. How much did you spend on lawsuits? Lucky 11 cost $25,000. They spent $44,000 on another case. And some $37,000 on cease and desist letters. As she started with more figures.........

Objection A total is not allowed. No totals.

Time 2:43 pm 15 minute break

Off The Record. Judge Royal Furgeson wanted to clarify a few issues for himself. The bottle caps do not perform a function? From the Ward Report (scheduled expert testimony) it appeared that bottle caps were functional when on a bottle but not on a choker? Hemingway claimed that it had a source identifying function but that it was not functional otherwise. The judge then commented about the sales figures. He finished with a comment about the claimed trade dress has five aspects claimed as part of the trade dress? At 2:55pm the judge left.

Time 3:00 pm Questioning of Diane Bradshaw Continues.

Hemingway asks Diane Bradshaw if her trade dress was merely decorative? The artwork is decorative but the "look" is distinctive in the marketplace. Has she seen Blue Brownies offer other products. Their bottle caps are inferior because the sample displayed has exposed glitter.

Objection She is analyzing Blue Brownies product .

m3 girl designs puts the glitter inside and seals it in. m3 girl designs has a program for returns and processing returns Diane Bradshaw had noticed products from other companies mistakenly shipped back. They would get returns of out of date designs from stores. Other companies bottle caps would be mixed in with theirs and she believed them to belong to Blue Brownies.

Objection The are no names on the bottle caps she could not have known to what company they belonged. She compared them on the internet. Overruled. (At no time was there any evidence submitted to support these claims. For someone monitoring the market place, and for someone concerned about confusion, maintaining a log of improper returns and keeping the returns would have been a logical step. Logical if that really happened.)

The Blue Brownies bottle cap returns were also falling apart. She put together a list of 30 companies who were selling the same products.

Objection Overruled.

Several could not be found but she went down the list and checked them all.

Objection Overruled.

Blue Brownies was the most persistent. They hurt m3 girl designs a lot. (From 2009 through June 2012, m3 gril designs showed sales of $4.5 million while later evidence shows Blue Brownies with sales of $86,200 for the same time frame. m3 girl designs sales were 52 times as great as those of Blue Brownies. After expenses, Blue Brownies had a profit of about $17 thousand for that time period. Blue Brownies hurt them a lot? (Really?) What has the lawsuit been like? Hard on them. But it's the law. She has to file a lawsuit.

Time 3:12 pm Passes Witness For Defense Questioning.

Charles Hanor conducted the questioning. On your trade dress, do you have to have a choker, a washer, a bottle cap and a magnet? Our trade dress Our trade dress is a fabric choker, an attachment have a metallic sheen, a bottle cap with the ridges pointing out with a raised projection on the bottle cap. Has the "raised projection" ever been anything other than a magnet? That is not our trade dress. Have you ever used any other item for the "projection" besides a magnet? That is not our trade dress. Have you ever sold a bottle cap with anything other than a magnet on the back? That is not our trade dress.

Your Honor. Please instruct the witness to answer the question. Judge Royal Furgeson stated that he does not order a witness to answer a question. It is up to the attorney to ask the question and then up to the jury to determine if the witness answered the question. (While this first appeared to be odd, it actually makes a lot of sense, once it is stated to the jury. Diane Bradshaw refusal to give direct answers to simple questions made her appear petty and like she was trying to hide something.)

And the shiny object, was that ever anything other than a zinc washer? It is an attachment having a metallic sheen. It wasn't shiny. Was it a zinc washer? It was an attachment having metallic sheen. What was your source of bottle caps? They got them from a distributor. Were the crowned ridges made just for m3 girl designs or were they functional? We sell a fabric choker, an attachment have a metallic sheen, a bottle cap with the ridges pointing out with a raised projection on the bottle cap. A bottle cap necklace does not infringe our trade dress of a choker necklace. (Diane Bradshaw was coming across as being very combative.)

Have you ever sold or made a bottle cap necklace that was not interchangeable? Don't know. Hanor submitted Exhibit #3 and #3a. They were admitted. #3 was SNAP CAPS on a display board. Are they all bottle cap magnets? Yes. Did you ever sell these displays to the stores? No. Did you ever give them to the stores? Yes.

On the projection screen, Exhibit #210, page 3, displayed. It was a sales invoice. Hanor pointed out to her that the chokers and the bottle cap magnets were listed separately on the invoice. Diane Bradshaw answered that it was done that way for inventory purposes. That is not the way they are sold. They are only sold paired as a choker bottle cap necklace. She did not remember when they started the on-line store. Who signed all of the agreements? She did. Who signed all of the checks? She did. Did they sell more bottle cap magnets or more chokers? They had no sales of just bottle cap magnets, nor sales of just chokers.

(Really? A quick visit to the m3 girl designs, as of this posting, website shows them being sold separately. They have maybe a dozen different colored chokers and 298 different bottle cap magnets. Under the heading of Snap Caps On-line, http://www.snapcapsonline.com there is a SNAP CAPS Collection, while "chokers" are listed as "Accessories". Never sold separately? Diane Bradshaw's nose was getting longer with every lie. Her lies did not weigh well with the jury.)

Exhibit #18 was displayed on the projection screen. Hanor observed that Maddie Bradshaw was not wearing a choker necklace. He then asked Diane Bradshaw to define how a choker was made. They cut up tights for the choker. What size? A size that was safe to go over a child's head. (Diane Bradshaw seemed to be attempting to portray the choker necklaces made by Blue Brownies as unsafe. But that was not a tradeamrk issue. It was an attempt to distract the jury and form a negative opinion of the Defendants.) She did not know the length. They used a template. She did not know the size of the tights or how many chokers could be made from one pair of tights. They used Amazing Goop as their glue. The designs were placed in the bottle caps and then a resin was used as a sealant. Where did m3 girl designs get all of their artwork? She did not know. Hanor stated that forty or so designs were clipart from Microsoft.

Objection. Sustained.

How many types of necklaces did they offer? Three, but the choker was 99% of their business. How are the bottle caps fastened to bracelets and hair bows? Using the attachments with the metallic sheen. The washers? They are attachments with a metallic sheen. Where did you get these "attachments"? She did not know. Didn't you buy the washers in bulk from places like Lowe's and Home Depot? She did not know. Did she ever use BottleCapCp.com? No. Where did they get their tights? Foot Traffic. She said they used to use a spray sealant on the bottle caps. They originally got their bottle caps from a distributor and that they came plain without any seal inside but more recently the bottle caps were coming with a seal inside.

How did a bracelet differ from a choker? The bottle cap usually was securely fastened to the attachment for a bracelet. If a competitor was just selling bottle cap magnets, would that be infringing? No. If a competitor was just selling chokers, would that be infringeing? No.

Hanor showed her Exhibit #D7, the CAPSTERS Kit. She said she had seen the book in a Learning Express store on Florida in 2008 but she had never read it. (Really? Their business was taking off in 2008 and there was a book and a kit on how to compete and she was not curious?) The book had pictures and details about making bottle caps magnets as well as necklaces. Hanor asked her how those necklaces in the book differed from those sold by m3 girl designs. Diane Bradshaw stated that it was the "overall look" of the trade dress that made it different. The "visual look" of the choker necklace with the attachment and the bottle cap with the "projection". But their necklace looked just like those pictured? "That is not our trade dress."

Time 4:14pm 15 minute break

Time 4:30 pm A question from the jury. Judge Royal Furgeson delayed the return of the jury while he discussed a question from the jury. The jury asked what is the difference between a magnet and the "projection" on the bottle cap? The judge asked of Hemingway, if it is not a magnet, then what is it? Hemingway replied that it is a source identifying function of the projection. He then added that the projection does not have to be a magnet.

Time 4:34 pm The jury was brought in. The judge thanked them for their interest and questions from the jury were always welcome. As for an answer to this particular question, clarification was up to the attorneys to establish during the trial.

Questioning of Diane Bradshaw continued. Hanor puts up the board exhibit that had examples of the choker necklaces on it. What was the difference between the projection on the example and a magnet? A magnet has a function. The projection does not. The m3 girl designs web site was projected live onto the screen, Snap Caps Online. Hanor clicked on the Bottle Caps link. He then described how he could select a single bottle cap, click on it, and add it to his cart. Was that correct? Yes. And then he could "check out", just buying the single bottle cap. Wasn't that correct? "But that's not the way they are marketed," claimed Diane Bradshaw. He again went through steps of buying a single bottle cap. She again insisted that that was not how it is sold. But they could buy just a single bottle cap magnet? "I Guess", she finally admitted. [Note - at the bottom of the web page there was a notice "Customers who bought this product also bought", followed by pictures of other bottle cap magnets and a picture of a choker necklace.] She claimed that purchasers always used the link to then buy a choker necklace before they checked out. But they do not have to?

Diane Bradshaw again tried to force the issue of buying a bottle cap magnet and then purchasing a choker necklace. Again she claimed that 99% of their business was one choker necklace sold with one bottle cap magnet Isn't it true that the downturn in business was because bottle cap jewelry was a fad that died? No, it was not a fad. The infringers caused the downturn in their business. (It seemed that whenever she could she would evade giving a direct answer to a question, preferring to fall back on well-rehearsed answers.)

Exhibits were put on the projection screen. Hanor points out to her that there is no mention of bottle cap jewelry sales, just lap desks. She claims that 2006 and 2007 sales figures were not lap desks but bottle cap jewelry. He then asked why there was no Schedule C on her 2006 and 2007 tax returns. [Note - Schedule C is for business deductions]. The income was not enough to separate out. It appeared that Hanor was trying to establish that the bottle cap jewelry business started in late 2007. The judge said the tax returns would not be admitted as evidence.

Hanor then had some of the Plaintiff's earlier exhibits displayed. Pictures showing Maddie and Margo in news articles or still pictures at trade shows. Was Maddie wearing a choker necklace in this picture? No. No. No. But the choker necklaces were there. To the side. In one picture, a Learning Express Trunk Show and Book Signing, Maddie was wearing a bracelet with a bottle cap magnet attached. That's not our trade dress. The bottle cap is glued to the bracelet. She then repeated what constituted their trade dress. The projection was not a magnet. It was the overall "visual look" that made up their trade dress.

Time 5:18pm Adjourned until 9 am Wednesday. Day 2 over

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