Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 1 of 47 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

Transcription

1 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 1 of 47 Civil Action No. 17-cv IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO RMH TECH LLC, a Colorado limited liability company, and METAL ROOF INNOVATIONS, LTD., a Colorado corporation, vs. Plaintiffs, PMC INDUSTRIES, INC., a Connecticut corporation, Defendant. COMPLAINT AND JURY DEMAND Plaintiffs RMH Tech LLC ("RMH Tech") and Metal Roof Innovations, Ltd. ("MRI") (collectively "RMH") state and allege as follows for their Complaint against Defendant PMC Industries, Inc. ("PMC"): I. PARTIES 1. RMH Tech is a Colorado limited liability company with its principal place of business in Colorado Springs, Colorado. 2. MRI is a Colorado corporation with its principle place of business in Colorado Springs, Colorado. 3. PMC is a corporation formed under the laws of Connecticut, having a principal place of business at 87 Spring Lane, Plainville, Connecticut PMC offers for sale and sells clamps, solar mounting systems and snow retention systems for use on standing seam metal roofs ("SSMR"). One of the snow systems is offered under the name COLOR SNAP. See Exhibit 1. 1

2 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 2 of 47 II. NATURE OF CASE 4. PMC has been falsely advertising its products and misappropriating RMH's business values. RMH has now come to conclude that PMC would not even be in the industry without its free-riding upon RMH s reputation, research and development. The claims are brought to stop false misrepresentations and restore the market to one of fair competition - not one predicated on calculating and deceptive advertisements, such as that depicted in PMC s flurry of print and social media. III. SUBJECT MATTER JURISDICTION 5. This action for false advertising, common law and statutory trademark infringement, and unfair competition arising under the Federal Lanham Act, 15 U.S.C and 1125 and common law and for unfair misappropriation under federal and state statutory and common law. 6. This Court has subject matter jurisdiction over all claims pursuant to 28 U.S.C. 1331, 1332, 1338 and IV. PERSONAL JURISDICTION AND VENUE 7. PMC manufactures a variety of products and devices used on standing seam metal roofs ( SSMRs ). PMC has and/or continues to sell these products in Colorado through advertised partners and others. 8. PMC has issued, directly or indirectly, false and misleading advertisements to Colorado residents, infringed the federally registered trademark of a Colorado resident, and misappropriated the business values of a Colorado resident. 2

3 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 3 of PMC further operates an interactive website which allows engineers, architects and contractors, including those located in Colorado, to form a business relationship with PMC, and through which product can be purchased, upon information and belief. 10. PMC is currently involved in an action in Colorado, Civil Action No. 1:16-cv CMA-KMT, and has asserted counterclaims in that Action. 11. PMC has purposefully availed itself of the rights and privileges of conducting business in Colorado and is subject to personal jurisdiction in this judicial district. 12. Venue is proper in this Court pursuant to 28 U.S.C V. PRELIMINARY STATEMENT 13. Many structures throughout the world utilize SSMRs. These roofs are constructed by fastening together multiple roofing panels. The panels are attached at their side edges to create a water-tight seam that typically sits above the surface of the panel. These panels and their seam configurations come in various shapes and sizes and are manufactured by a variety of different companies. Examples of some roof panel seam profiles are shown below: 3

4 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 4 of Prior to RMH and its innovative products, manufacturers of roofing panels generally advised customers not to attach anything to their roofs, as to do so would create a failure point on the roof panel that would void the roof warranty. Damage to the roof was one obvious concern; anchorages failing and falling off the roof with attendant equipment was another. Roof leakage and continual roof maintenance a third. 15. Mr. Robert Haddock, a visionary, and veteran of 44 years in the metal roof industry, realized there was a significant need for systems that would allow items to be attached to a SSMR, but without creating a failure point, leakage or maintenance issues that would void of the roof warranty. Mr. Haddock thus developed and patented his innovative unitary clamping products and systems. Those clamps and attachment systems, offered under the brand name S-5!, have been covered by a number of patents (some of which are now expired). Generally, the core technology is comprised of the components shown below: 4

5 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 5 of Even though RMH had clamps that worked well to secure items to SSMRs, panel manufacturers and others needed to be convinced to accept the products as viable and not harmful to their roofs. So, over a period of decades, RMH and its team set about testing the various S-5! clamps with virtually every panel type on the market. That work led to development of the Load Test Results chart ( Load Tables ). Below is an example of the Load Test Results where the Panel Manufacturer is Butler : Exhibit RMH used the Load Tables, and the testing and engineering work behind them, to prove to industry participants that its products were safe and did not create failure points on roofs. RMH then used the data to convince the panel manufacturers, and thus their customers, that using S-5! clamps would not create failure points and should not void panel warranties. 18. Next, RMH needed to convince the metal panel industry that the actual products that were being sold, not just the ones tested, would work as intended and advertised. RMH undertook to have all components of its raw products chemically/metallurgically and mechanically certified and utilized Nationally Recognized Testing Laboratories (NRTLs) and third-party QC compliance agencies to prove to customers that what they were buying was the same as what was tested and referenced in 5

6 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 6 of 47 the Load Test charts. RMH is able to ensure that its products meet these high-quality standards as its award-winning production facility undergoes regular QC compliance inspections and audits by third party testing and compliance organizations, including Underwriters Laboratories, Factory Mutual, Intertek, the ICC and ISO. 19. RMH developed and has maintained the market for SSMR attachment devices and systems through painstaking attention to quality and testing details and through production of its products in a certified factory. This work converted a number of product skeptics into actual product distributors. As a result, RMH became the market leader in these technology areas. These technologies were disruptive in nature, changing the way people think about SSMR and rooftop accessories. Where before, such accessory mounting was always expensive and problematic, now it was affordable and reliable. Tangential and pertinent to all the foregoing is that the testing, engineering and truth in advertising aspects of RMH became synonymous in the marketplace with the product category, itself. PMC is now wrongfully attempting to piggy-back on the integrity of RMH, without expending any of the technical diligence associated with the establishment of that integrity. VI. GENERAL ALLEGATIONS a. FEDERAL AND COMMON LAW TRADEMARK INFRINGEMENT 20. MRI is the owner and RMH is the exclusive licensee of now incontestable U.S. Trademark Registration Number 733,240 in International Class 12 for structural metal panels with a color coating. Exhibit 3, p. 67. It issued in 1962 and remains valid and subsisting. While the mark as a whole has source identifying significance, the primary source significance attaches to the word COLOR. 6

7 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 7 of RMH has for more than two decades been selling a snow retention system under the common law and federally registered trademark COLORGARD, shown below: 22. Mid-last year, PMC copied RMH's COLORGARD system and, more recently, mimicked RMH s PV-Kit using the same or nomenclatures strikingly similar to RMH s to advertise its product. PMC's COLOR SNAP snow retention system is shown in the following photograph 7

8 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 8 of Based upon RMH's continuous non-interrupted use of COLORGARD for years in interstate commerce, relevant consumers have come to associate it exclusively with RMH, who thus also acquired strong common law trademark rights in and to the mark long before PMC, which without authorization, used a very similar mark on visually identical products. 24. PMC has advertised for sale and sold snow retention systems under COLOR SNAP in interstate commerce. The snow retention systems of PMC and RMH are virtually identical in intended function and look to a common observer to be virtually identical products. PMC's and RMHs virtually identical snow retention systems are sold to virtually identical end consumers, through virtually identical marketing channels and are advertised in very similar ways, using very similar materials and techniques. The products are also not that expensive and are being marked under very similar marks. These factors all indicate that confusion in the market place is more than likely, regardless of the addition of SNAP or, in some instances, house marks, to PMC's marketing materials. Rather, PMC 8

9 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 9 of 47 specifically adopted a mark that it knew was already in use by a preexisting competitor, breaching its duty to select a mark for its later-in-time product that is not confusing to the public. 25. PMC applied for and received U.S. Trademark Registration No. 5,074,793 directed to the mark COLOR SNAP for use with Metal roof snow guard or rail and metal clamp-type fasteners for holding a snow guard to a metal roof seam. Exhibit 4. The first use in commerce for the mark was in June of Notably, no claim is made to the exclusive right to use the term Snap as part of the mark, which PMC disclaimed during prosecution in January of As a result, the trademark is Color for use on or with metal roof snow guards or rails for them. 26. In September of 2016, Damian Wasserbauer provided a Declaration where he stated that the signatory believes that to the best of the signatory s knowledge and belief, no other persons have the right to use the mark in commerce, either in the identical form or in such near resemblance as to be likely, when used on or in connection with goods/services of such other person, to cause confusion or mistake, or to deceive. Id., p. 19. Upon information and belief, PMC was aware of RMH s COLORGARD mark when Mr. Wasserbauer executed the Declaration and should have instructed Mr. Wasserbauer to reveal that use to the USPTO and, upon information and belief had that disclosure been made, the PMC registration would not have been approved. 27. PMC s infringement is willful, specifically choosing to use the term "COLOR" when deciding how to mark snow retention products. PMC was aware of exactly what it was doing when it chose to offer identical products under a mark that is very similar to 9

10 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 10 of 47 RMH's COLORGARD mark. In short, PMC knowingly and wantonly chose to offer and sell its product and to damage, perhaps irreparably, RMH s superior, perendinate and valuable reputational rights reflected in the COLORGARD mark. VII. GENERAL ALLEGATIONS RELATED TO FEDERAL AND STATE MISAPPROPRIATION AND FALSE ADVERTISING A. PMC's False and Misleading Patent Marking Activities 28. Patent applications are assessed by patent examiners and patents are issued by the USPTO. Once issued, patents demonstrate to consumers that the patent owner is credible, innovative and a leader in the field with respect to the products covered by the patent claims and can be used to attract venture capital, industry awards, government approvals, and commercial recognition. A patent applicant, however, cannot claim exclusivity over an invention until a patent application has issued into a patent and its claims cover the purported invention. This distinction is made clear on the USPTO website: Some persons mark articles sold with the terms Patent Applied For or Patent Pending. These phrases have no legal effect, but only give information that an application for patent has been filed in the USPTO. The protection afforded by a patent does not start until the actual grant of the patent. False use of these phrases or their equivalent is prohibited. USPTO, General information concerning patents (Oct, 2015) (last visited Oct. 11, 2017) (emphasis added). Stating that a product is patented before the patent issues is improper patent marking and materially deceives the public. PMC has engaged in such conduct. 10

11 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 11 of Each of the misrepresentations discussed below constitute injury to RMH's commercial interest as a competitor. The misrepresentations also demonstrate deceptive acts and practices in Colorado against the public for, inter alia, falsely representing that PMC s products are patented. As a direct and proximate result of the wrongful conduct described herein, PMC has also been unjustly enriched by the amount of its gross profits and cost savings that it has received through the deceptive advertising, which effects could linger beyond the reach of this case and the Court. The conduct must thus be remedied through, among other ways, aggressive corrective advertising and injunctive relief. a. The COLOR SNAP snow retention system is not a PATENTED DESIGN 30. PMC filed a United States Patent application, which published as Publication No. US2017/ ("the 974 Publication"), disclosing the COLOR SNAP product. 31. Exhibit 5. To clamp the cross member (200) to a roof, an adaptor (130) is secured to the cross member and to an AceClamp A2 and/or A2-N (154), which has been secured to a seam of the roof. 11

12 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 12 of The 974 Publication has not been allowed or granted. In confusing consumers, though, PMC stated on its website on or before March 30, 2017, that the COLOR SNAP system - described in the 974 Publication - is a PATENTED DESIGN. Exhibit 6. Advertising that the system is patented - as a matter of law - is literally false because an applicant can only describe an invention as patented after a patent that includes claims that cover the involved system has been issued by the USPTO. 33. Upon being informed of the misleading patented term on June 2, 2017, 1 PMC apparently changed the site so that the term PATENTED DESIGN is no longer shown. In its place, PMC uses the term UNIQUE DESIGN and uses the term patent pending below that term and now with respect to the push pins included as part of the A2 line of clamps that are used with the COLOR SNAP product: 1 While RMH seeks permanent retraction of the falsity, retraction is only one of the several remedies that RMH is seeking with respect to this falsehood and is also seeking damages/lost profits for the period of time that the falsehood has appeared on the website and corrective advertising relief. 12

13 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 13 of 47 Exhibit 7. In short, PMC has now admitted that its prior advertising was false on its face and must answer for that conduct. 34. These misrepresentations made by PMC place it in a positive light to consumers, suggesting to consumers that PMC maintains patents on its COLOR SNAP system, when it does not have such patents. Maintaining that false (patented) façade supplies PMC with a competitive edge that allows it to unfairly cut into RMH's market share, i.e., PMC s advertisements influence and deceive consumer decisions to contract with PMC over RMH. 35. PMC intentionally and knowingly made these misleading representations. PMC knows it does not have U.S. government issued patents on the discussed products. PMC's misrepresentations thus manifest a conscious desire to mislead consumers in a demonstrably deceptive way. By falsely stating that PMC has obtained U.S. government 13

14 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 14 of 47 issued patents, PMC also deprives RMH of its legitimate competitive advantage flowing from actually having a patent on its snow retention products, reducing consumers' incentive to select RMH as a preferred snow retention system supplier. The way PMC has sought this end goal is nothing more than an intentional effort to bypass fair market practices and to improperly gain credibility in the marketplace. b. A2 and/or A2-N clamps are not patented. 36. In PMC ads, PMC implies that its A2 clamp are protected by a U.S. patent, when objectively and clearly the clamp is not covered by claims of any patent. For example, in the nationally recognized Metal Roofing magazine, Vol. 1, No. 2 (April 2016), PMC described its clamps as patented and designed for snow retention systems - providing purported superior loading forces based on the patented push pin design. See Exhibit 8. But again, the A2 clamp is not a patented product, nor are the push pins. 37. PMC makes other false representations that also damage RMH. In materials to be distributed at the Metalcon 2017 Conference, scheduled for October 18-20, 2017 (see Exhibit 9), PMC states: The AceClamp family of products is unique to the industry... Our extensive line of solar and snow retention systems come equipped with our award winning patented push pin designed clamps that don't damage panel surfaces or coatings.... Brands:... AceClamp, A2 AceClamp, Precision Snow-Guards, AceClamp Solar Kits and AceClamp Snow-Rail systems. Exhibit 9, (emphasis added). None of PMC s allegedly "award winning" clamps are patented. Identical language also appears in the American Institute of Architects ( AIA ) conference materials - a trade show that occurred April 27-29, 2017 (see Exhibit 10), as 14

15 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 15 of 47 does the Solar Power International materials - a conference scheduled for September 10-13, Exhibit 11. c. The A2 and/or A2-N clamps are not covered by U.S. Patent No. 7,386, Using U.S. Patent No. 7,386,922 ( the '922 Patent ) on advertising associated with the A2 clamps (see below) is false and only serves to reinforce PMC s bad faith attempts to obtain an unfair advantage in the marketplace. 39. In a YouTube advertisement - titled, AceClamp Clamping The Competition, PMC clearly labels a clamp at the 24 th second with PAT. No. 7,386,922B1. AceClamp PMC Industries, AceClamp Clamping the Competition, YOUTUBE (Mar. 11, 2015), 15

16 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 16 of 47 PMC does not show the whole clamp, which is an ML clamp covered by the '922 Patent. The rest of the advertisement, however, utilizes an A2 clamp which is not covered by that Patent. Flashing of the ML clamp patent number when advertising the A2 and/or A2-N clamps that are not covered by the displayed patent serves no other purpose than to knowingly deceive customers. B. PMC's Comparative Advertising Misrepresentations 40. To gain credibility in the market, PMC has also falsely and intentionally represented the nature and quality of its products through misleading means. The fact that the advertisements have been portrayed in comparative contexts has only reinforced PMC s intent to gain market share through any possible means. PMC's misleading comparative advertisements have not only been made through websites and third-party trade magazines, but also through YouTube and FaceBook media campaigns - damaging RMH s reputation and goodwill. 16

17 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 17 of By its acts and conduct described herein, PMC has deliberately sought to advertise through deceptive and misleading means to aggressively and intentionally lure potential customers from RMH. Based on that pattern of behavior, the wrongful conduct described herein was attended by circumstances of willful and wanton conduct to capture market share in Colorado - among other markets - through unfair and disparaging means resulting in injury to RMH. PMC allows its deceptive and misleading marketing to permeate the consumer advertising consciousness and perpetuate PMC's false claims and promises. Thus, while each of the misrepresentations constitute injury to RMH's commercial interest as a competitor, the misrepresentations also demonstrate deceptive acts and practices in Colorado against the public. As a direct and proximate result of the wrongful conduct described herein, PMC has been unjustly enriched by the amount of its gross profits and cost savings that it has received through the deceptive advertising, among other ways. a. Misleading statements about quality of the PMC products compared to competition 42. PMC represented in advertisements that its products are stronger, safer, and faster to install than RMH s products. These types of claims are subject to objective evaluation and demonstrably false. In misrepresenting the strength of its products, PMC falsely asserts on its website that the AceClamp family of roof mounting innovations are stronger than the same old products to mount solar, satellite or practically anything : 17

18 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 18 of 47 Exhibit Making this statement even more circumspect, PMC provides "clickable" FaceBook and YouTube links on its webpage - the latter providing a direct link to AceClamp s YouTube channel that displays an advertisement comparing PMC s with RMH s products. The consumer is thus told that the so-called same old products are RMH s products - who is in fact a leading competitor to PMC, as described by PMC itself in other YouTube advertisements. AceClamp PMC Industries, Ace Race Metalcon Widescreen, YOUTUBE (Jan. 5, 2017), Upon information and belief, taken separately or together, a consumer would view PMC s products in a positive (albeit false) light and RMH's product in a negative (again, false) light. Upon information and belief, a consumer would view PMC s A2 clamp as stronger - and, for that reason, a superior clamp for solar or snow retention systems. But PMC s claims as to strength are demonstrably false, unproven, or both. 18

19 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 19 of On information and belief, PMC has not engaged in relevant scientific testing to verify that its products are stronger than comparable RMH products. Moreover, and on information and belief, there is no reliable testing of any PMC products in the snow retention or solar markets such that PMC could conclude that its products are stronger than RMH s products in those settings - making PMC s superiority claim a literal falsehood. b. False implications regarding roof warranties 45. PMC also falsely implies that its A2 clamps preserve roof warranties while, at the same time, falsely implies that use of RMH's clamps will void those warranties. PMC falsely asserts that RMH's clamps damage roof seams because of the rotational force applied to the panel surface by RMH s set screws. This assertion is false and best reflected in PMC s comparative YouTube advertising, titled ACE Clamp Color Snap SSMR Snow Guard clamp and rail installation speed comparison trials. AceClamp PMC Industries, ACE Clamp Color Snap SSMR Snow Guard clamp and rail installation speed comparison trials, YOUTUBE (Oct. 27, 2016), watch?v=zjyhdkk6hgc ( Speed Comparison Trials Video ). At the 37th second mark of the advertisement, the speaker states that both the AceClamp Color Snap and the other leading brand attach to SSMRs via a clamping system before providing the following image at second 55: 19

20 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 20 of 47 Upon information and belief, Product X are RMH products. Next, between the 1:32-1:43 minute mark of the video, PMC asserts its products do not damage the roof panel because there is no rotational force to the roofing material [i.e. twisting force], which helps safeguard the finish for roof warranty." PMC then asserts at the 2:04 minute mark, when the camera turns to Product X that uses set screws and applies pressure and rotational force. The direct implication of these statements and photography is that PMC s products do not use rotational force and do not damage roof panels, safeguarding the roof warranty, while implying that RMH s products do use rotational force, and therefore damage the roof panel and will result in a voided roof warranty. These implications are, again, false. 46. RMH s products do preserve roof warranties - and has scores of endorsements from roof manufacturers to support this fact, including an endorsement from the very inventor of Galvalume coated steel from which many SSMR panels are constructed. Indeed, it was the pioneering research and development of RMH that led to the entire attachment industry obtaining credibility from the roofing panel industry in the first 20

21 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 21 of 47 place. The fact that PMC now seeks to bring into question that reputation through calculating and deceptive advertising tarnishes RMH s reputation in the industry. Further, although the falsehood is made by way of inference, it is demonstrably deceptive. c. PMC s products are quicker to install 47. PMC next falsely asserts that its Color Snap system is faster to install than RMH s competitive COLORGARD system. PMC makes a false claim as to speed of installation in YouTube advertisements, as reflected in the Speed Comparison Trials Video. Upon information and belief, PMC asserts it is faster because its clamps come preassembled while the screws of Product X (i.e. RMH s product) must be assembled first, delaying the installer. Upon information and belief, PMC conveniently fails to explain to the customer that during travel to a job site, it is common for clamp installers to prepare the products in the vehicle-leading to more seamless installation of the products on site. In other words, the Product X clamps are usually pre-assembled when they reach the project site. 48. PMC also misled consumers by asserting that because its products are quicker to install, labor costs are reduced. This is depicted on PMC s webpage: 21

22 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 22 of 47 Exhibit 13. Upon information and belief, the above written representation again takes no account of real world conditions. To say that labor costs are cut in half without any context, as demonstrated in this advertisement, fails to account for many aspects of actual roofbased projects - including: (1) the time it takes for contractors to get to and from the site; (2) the preparatory time in placing the snow retention products on the roof (inclusive of the time required to erect ladders and safety harnessing equipment); (3) the setting of the string line and layout to ensure snow retention products are aligned; and (4) tool preparation and inspection time, among others. All these factors are equivalent for either system. Thus, the claim in the advertisements that PMC s products will Lower Labor Costs because the typical install times [are] less than half that of leading competitors is misleading at best. 22

23 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 23 of 47 d. PMC s Own Contradictory Statements 49. PMC s next falsehood is predicated on the concept of torque back-out, i.e., the loosening of screws within the sleeve of an installed clamp. PMC asserts that [t]he A2 s innovative solution prevents torque back-out, caused by wind flutter or constant seismic vibration. Exhibit 14. In another example, an advertisement for the A2 AceClamp asserts that there are No worries about torque back out as the below ad shows: Exhibit 15. PMC also represents that A2 clamp eliminates the need for periodic retorquing of the clamps and that The A2 s innovative solution prevents torque back-out, caused by wind flutter or constant seismic vibration. Exhibit 16. But when these advertisements are compared with PMC s product specifications for products using A2 clamps, there exists a material, misleading disconnect. 50. In the specification for the AceClamp SolarKit which use the A2 clamps - PMC state [d]ue to high winds and/or heavy snow loads, periodically check clamp position for shifting. If needed, re-torque clamps are required, follow directions in the installation 23

24 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 24 of 47 instruction booklet. Exhibit 17, (available at specdata/pmc_07%2072%2000_sd_solar%20clamps_2017.pdf). Regardless of whether re-torque occurs or not in the snow retention industry, PMC s no-retorque advertisements directed solely to the A2 clamp that is used in the AceClamp SolarKits cannot be true based on this specification that PMC actually proffers to its customers. PMC's torque-out advertising campaign is literally false based on its own documents. e. Breadth of Potential Use 51. PMC next falsely asserts that its clamps cover nearly all roof profiles - requiring a distributor to carry less inventory of PMC clamps than the distributor would need to carry if it stocked a competitor's clamp. The claim is materially deceptive at two levels. PMC asserts that: Just 4 Clamps will cover 95% of SSMR profiles as stated below: Exhibit 18. Upon information and belief, there are scores of SSMR profiles and no scientific evidence to support PMC s claim, which is false and, even worse, PMC knows 24

25 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 25 of 47 that just 4 clamps do not cover 95% of all SSMR profiles. Upon information and belief, Industry experts have and will continue to say that four clamps could conceivably capture 60-80% of all SSMR profiles, not 95% of the available profiles. But, upon information and belief, even the upper end of this spectrum is a likely stretch since distributors and consumers have become more educated on how different clamps can serve different purposes based on the application used (snow, solar, HVAC, etc.) and the SSMRs involved, meaning even if they could, they would not use just 4 clamps in 95% of all attachment scenarios. 52. But even more tellingly, in recent trade show advertisements, such as the AIA Conference on Architecture 2018, PMC is already tempering its 95% claim to 90% - showing the formerly touted 95% claim to be what it always was, false. See Exhibit 19. Yet PMC contradicts itself by continuing to represent that Just 4 Clamps will cover 95% of SSMR profiles on its website. See Exhibit 18. In any case, and upon information and belief, PMC has published no testing to substantiate these combined claims, which are false. 53. The misrepresentations are material because, upon information and belief, consumers would likely enter into contracts with PMC based upon them, since the advertisements falsely represent PMC's products as being superior with respect to versatility. The comparative advertisement misrepresentations also place PMC in a positive light, unfairly cutting into RMH's market share. Indeed, PMC s advertisements are designed to influence consumer decisions to contract with PMC over RMH. 25

26 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 26 of 47 C. PMC s Use of Third-Party Certifications 54. Both parties represent to consumers that their products are substantiated by scientific results or third-party certifications. RMH properly applies these certifications; PMC does not. 55. Third-party certifications are important to PMC's branding and economic success because it provides PMC with a competitive edge through third-party recognition vis-à-vis other snow retention suppliers in the market. PMC's misrepresentations are thus material, as consumers would likely enter contracts with PMC, since PMC products would be recognized as third-party certified based on the incorrect purported representations. 56. These misrepresentations create confusion because consumers in general put a great deal of faith in UL or ISO markings and approvals, often without realizing that these approvals are specific to a given use or specific assembly. By making representations regarding the UL or ISO certifications in an indiscriminate fashion, PMC is deliberately creating a false sense of security in the mind of consumers with respect to its goods, falsely indicating to them that they have all been blessed by these approval agencies for any application. RMH, on the other hand has been cautious and responsible with such representations. The net result is that consumers perceive that PMC is not only as good, but better than RMH, which is a falsehood, and with the inverse actually being true. 57. Upon information and belief, these literal misrepresentations place PMC in a positive light because it purportedly certifies the COLOR SNAP snow retention system and parts, like the A2, for use in the COLOR Snap snow retention system. Maintaining a false 26

27 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 27 of 47 certification supplies PMC with a competitive edge that allows it to unfairly cut into RMH's market share, i.e., PMC s advertisements influence and deceive consumer decisions to contract with PMC over RMH. Upon information and belief, the misrepresentations referenced would thus actually deceive or, at minimum, have the tendency to deceive, a substantial segment of consumers seeking these products throughout the U.S. 58. While each of the misrepresentations constitute injury to RMH's commercial interest as a competitor, the misrepresentations also demonstrate deceptive acts and practices in Colorado against the public for, inter alia, falsely representing that PMC s products are third-party certified. As a direct and proximate result of the wrongful conduct described herein, PMC has been unjustly enriched by the amount of its gross profits and cost savings that it has received through the deceptive advertising. a. UL certifications 59. There are numerous standards that may apply to the roofing industry. Some apply to components of solar and snow retention assemblies, as well as the complete assemblies themselves. The Underwriters Laboratories ( UL ) is but one example. On its website, UL states that it helps companies demonstrate safety, confirm compliance, enhance sustainability, manage transparency, deliver quality and performance, strengthen security, protect brand reputation and advance societal wellbeing. UL, About Us What We Do, (last visited Oct. 13, 2017). Some of the services offered by UL include inspection, advisory services, education and training, testing, auditing and analytics, certification software solutions, and marketing claim verification. Id. UL s website further states that UL collaborates to establish standards 27

28 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 28 of 47 that create level playing fields and works to develop new pathways for the latest innovations. Id. One such standard (for solar PV) is UL a standard that is divided in into two sections: Bonding, and Mechanical Load as applied to Mounting Systems, Mounting Devices, Clamping Devices and Ground Lugs for Use with Photovoltaic Modules and Panels. Once a component or assembly meets the requirements within the UL 2703 standard, companies may bear the following UL mark to demonstrate that the component or assembly is recognized by UL: UL 2703 Recognized Component A recognized component is different than a listed component. A product that is UL Listed bears the following mark: Whether a product is certified to a UL standard can be ascertained from UL Certifications Directory, accessible at index.html. 60. PMC misrepresents to the consuming public that it has third-party UL approval of its COLOR SNAP, A2 and A2-N clamps. Upon information and belief, PMC falsely relies on UL approval in paragraph 47 of its US Publication No. 2016/ ( the 28

29 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 29 of Publication ). Exhibit 20. PMC knows that UL 2703 listing is limited to assemblies of components, not to specific components like the clamp. Nevertheless, PMC states in its publication In this manner, the present invention overcomes disadvantages of prior art systems... to create a stronger hold on the standing seam 103 under vibratory, wind and other environmental conditions so as to satisfy UL 2703 requirements (see UL (Underwriters Laboratories- for mounting and clamping devices to withstand most any environment and maintain electrical conductivity. Id., [0047]. The 984 Publication further reveals that the invention - i.e., the A2 clamp, being the subject of the invention - applies to for securing a device (e.g. a solar panels, Roof Mounted Displays, Satellite Dishes, Conduit and Piping, Snow-Retention Systems, HVAC ). Id., [0008]. But, upon information and belief, the UL 2703 standard received by PMC relates to the A2 with Solar Kit or the ML with Solar Kit and does not relate to snow retention systems, meaning reference to the UL 2703 load testing metrics in a patent application directed to PMC s snow retention systems is a literal falsehood. See Exhibit Further, in its 984 Publication, PMC states that UL 2703 supports a vibratory standard - and that PMC s products meet this standard. But, upon information and belief, UL 2703 does not test for vibration. Upon information and belief, PMC s vibratory falsehood is pertinent because, by asserting its products meet "vibration" standards, PMC is apparently able to pass state and local ordinances that mandate products meet certain vibratory (seismic) standards. For example, upon information and belief, LA City and LA County safety concerns related to seismic activity has led to more stringent standards than other counties throughout the United States. False vibratory testing results and approvals 29

30 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 30 of 47 could lead to easier approval processes with these government bodies. The need for injunctive relief thus becomes more urgent considering these broader governmental and business concerns, especially if government safety regulations are being undermined by PMC. 62. Describing PMC s snow retention products as UL certified is not just limited to PMC s 984 Publication, it is also depicted below in specification/advertising materials - only reinforcing the deception in a commercial context: b. ISO Certifications 63. Another standardization body, regulating products sold into the roofing industry, is the International Organization for Standardization ( ISO ). This independent, non-governmental body creates documents that provide requirements, specifications, guidelines or characteristics that can be used consistently to ensure that materials, 30

31 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 31 of 47 products, processes and services are fit for their purpose. ISO, Standards, (last visited Oct. 13, 2017). A company s manufacturing process may become ISO certified through auditing. If the process meets ISO s specific standards, and ISO certificate may then be issued. That certificate can be used for promotion purposes to supply credibility to a company s products and/or manufacturing processes. 64. PMC falsely asserts and misleads consumers into believing that its metal products are ISO 9001:2008 certified when they are not. Specifically, PMC provides under a reference to ISO 9001:2008 that it aims to insure [sic] that the manufacture of its molded and metal products are of the highest quality. Exhibit 22. A Management System Certificate posted to PMC s webpage that states This certification is valid for the following scope: The Manufacture of Plastic Injection Molded Parts and Rubber and Teflon Bonding Seals, and the Cavities and Molds Used Therefore. Id. PMC s deception is, therefore, deliberate and only tailored towards confusing consumers, including RMH's consumers, for PMC's benefit. VIII. PMC MISAPPROPRIATION OF RMH S RESEARCH AND MARKETING AND MISLEADING THE PUBLIC WITH ME TOO CAMPAIGN a. RMH s Investment in Research and Marketing 65. RMH is a market leader in developing snow retention and other products for SSMRs - including the COLORGARD covered by U.S. Patent No. 6,470,629 ( the '629 Patent ). Critically, these products are laboratory-tested, with those test results being reflected in RMH s Load Tables. Such testing is not just of the products, but the roofs themselves. 31

32 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 32 of One of its well-known products, the S-5! Clamp - a central component to the snow retention system embodied in the 629 Patent - has been extensively tested. For example, RMH provides detailed load testing results substantiating the strength of the S-5! Clamp on the S-5! Website. See e.g. Exhibit When a user selects a particular Load Test Result, they are presented with the option to click on two Load Tables. Id. When the user clicks on one, an icon box appears that states: Terms of Use Acceptance of Binding Contract Metal Roof Innovations, Ltd. (referred to herein as MRIL ) provides or enables access to the Snow Retention Calculator and Load Table (the Calculator ) at this website. Use of the MRIL Website by you is subject to the Terms of Use General and to the additional terms of use applicable to the Calculator set forth below By accessing, downloading or otherwise using the Calculator, you have made a legally binding contract with MRIL to comply with the Terms of Use. You do not have to sign any agreement to become bound. If you do not agree to these Terms of Use, you are not authorized to use the Calculator. Each time you use the Calculator, you accept the Terms of Use in effect at the time. Exhibit 24. This notice informs the user that the Calculator and Load Table are proprietary information. 68. RMH invested a substantial amount of resources in undertaking the necessary research to substantiate the strength of its products. This research, product development, proving and testing required years of time and millions of dollars to complete. Analysis of these results requires further time and cost before the results are incorporated into websites and other marketing materials. RMH does not authorize the use of its research results to third parties, such as PMC, as limiting the use of the research guards 32

33 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 33 of 47 against the broader distribution that would reduce the value of the information. PMC s conduct described below causes such a reduction in value. 69. The willful dissemination of the Load Tables damages RMH from a financial standpoint, as well as, a reputational one. RMH has put the work into develop, the Load Tables. Others simply copy what PMC copied and RMH created. For example, and upon information and belief, a company like Fall Protection Distributors ("FPD") can unfairly piggyback on RMH s work, using information on the 100s of SSMRs - originating directly from RMH s Load Tables. FPD can then advertise that FPD's products are "compatible" with those SSMRs. That damage flows back squarely to PMC. b. PMC s unauthorized use of RMH s Load Tables 70. Upon information and belief, PMC misappropriates RMH s research through oral and written means, by incorporating RMH's materials into quotations to customers and at conferences, among other events, so to compete with RMH. Upon information and belief, PMC also has freely disseminated RMH s Load Table to distributors. For instance, Unirac is a leading manufacturer of solar racking in North America. RMH uncovered evidence that PMC disseminated its Load Table to Unirac, as reflected in the following truncated Unirac table: 33

34 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 34 of The table is obviously branded with ACECLAMP jr, being the same PMC product as the AceClamp ML. On information and belief, PMC purposefully disseminated the Load Table, claiming it as its own, to provide itself with credibility to Unirac and to thus help it sell Ace/PMC products used in Unirac's solar racking system. By using RMH s Load Tables, PMC has capitalized on RMH's business values, and the value lost due to that misrepresentation/misappropriation continues to this date. See Exhibit 25. Upon information and belief, Unirac stopped doing business with PMC several years ago, but this is an example of the lingering effects of PMC s misrepresentations. 72. The publishing of portions of the Load Test table and its recirculation is another example of lingering effects of PMC's mis-deeds. That Load Table or index of metal roof profiles and manufacturers is now widely disseminated and abused by other competitors, and RMH cannot effectively stop that misuse. RMH spent hundreds of thousands of dollars developing this table, only to have many competitors usurp its value. This was a direct result of PMC s original mis-use of this proprietary information. 34

35 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 35 of 47 c. PMC s Me Too Campaign 73. PMC has also implemented a "me too" marketing strategy to vouch for the quality of its products - representing a free-ride in its worst commercial form. Not only does PMC disseminate RMH s Load Tables, but it advertises (or implies) that because its snow retention systems are similar in structure to RMH's patented systems, the customer can simply rely on RMH's research to vouch for the quality and safety of PMC s products. This systematic free-riding on RMH s research efforts are willful - particularly in circumstances where PMC knows that RMH s research constitutes a significant part of its business model and market leadership. 74. PMC's systematic free-riding is enhanced through the deceptive trade practices discussed above, whereby PMC states to distributors, by commission or omission, that it (1) originated information in the Load Tables - testing and collating it as to PMC s products; (2) obtained RMH authorization to copy and disseminate the proprietary information in the Load Tables; or (3) is connected, affiliated, or associated with the S-5! Load Table information. Upon information and belief, PMC profited or benefitted from each of these acts. 75. PMC thus uses RMH's own research and efforts against it (statistical data, etc.) to buttress PMC s own product sales, while diluting RMH s reputation and that of its products. By adopting a me too position, PMC misappropriates very important aspects of RMH s business model, suggesting to consumers, that PMC s snow and other systems are "just as good" as (or even "better" than) RMH s systems, based on structural similarities 35

36 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 36 of 47 (and aesthetics), without developing any research strategies of its own, nor seeking authorization for use of RMH s test results or index of profiles and roof manufacturers. 76. The routine and systematic free-riding on RMH s research further impairs RMH's incentive to provide its research as an exclusive feature to its existing customers and to potential customers. By reaping where it has not sown, PMC dilutes the value of RMH s research - and diminishes RMH s reputation as the market leader in the industry in both local and national markets. IX. FIRST CLAIM FOR RELIEF (Federal Trademark Infringement of COLORGARD Trademark Under 32 and 43(a) of the Lanham Act, 15 U.S.C and 1125(a) 77. RMH incorporates paragraphs 1 through 76 as though fully set forth herein. 78. Without RMH s consent, PMC has used, on and in connection with the sale, offering for sale, distribution and advertising of its snow retention products the mark COLOR Snap, and has told the world that snap has no significant source identifying function. 79. These acts constitute infringement of the COLORGARD trademark and have been committed with the intent to cause confusion, mistake, or deception, and are in violation of 15 U.S.C and 1125(a). 80. As a direct and proximate result of PMC s infringing activities, RMH is entitled to recover damages and the unlawful profits of PMC. 81. PMC s infringement is exceptional and intentional, entitling RMH to treble the amount of its damages and profits awarded, and to an award of attorneys' fees and costs under 15 U.S.C. 1117(a). 36

37 Case 1:17-cv Document 1 Filed 10/13/17 USDC Colorado Page 37 of RMH is entitled to injunctive relief pursuant to 15 U.S.C. 1116(a). X. SECOND CLAIM FOR RELIEF (Willful Violation of 38 of the Lanham Act, 15 U.S.C. 1120) 83. RMH incorporates paragraphs 1 through 82 as though fully set forth herein. 84. As outlined above, PMC procured Federal Trademark Registration No. 5,074,793 based upon fraudulent written representations and declarations. 85. These acts constitute willful violation of 15 U.S.C. 1120, resulting in injury to RMH. As a direct and proximate result of PMC s activities, RMH is entitled to recover, among other things, actual damages suffered from PMC s conduct. 86. PMC s conduct renders this case exceptional and intentional, entitling RMH to, among other things, an award of attorneys' fees under 15 U.S.C. 1117(a). 87. RMH is entitled to injunctive relief, in the form of corrective advertising to inform the industry that PMC fraudulently acquired Federal Trademark Registration No. 5,074,793 and in the form of an order issued and directed to the USPTO, directing that Federal Trademark Registration No. 5,074,793 be expunged from the trademark roles for fraud in the procurement. 88. PMC s conduct is exceptional and intentional, entitling RMH to treble the amount of its damages and profits awarded, and to an award of attorneys' fees and costs under 15 U.S.C. 1117(a). 89. RMH is entitled to injunctive relief pursuant to 15 U.S.C. 1116(a). XI. THIRD CLAIM FOR RELIEF (False Advertising Claim Under 15 U.S.C. 1125(a)(1)(A) and (B) with Respect to PMC's False Advertising) 90. RMH incorporates paragraphs 1 through 89 as though fully set forth herein. 37