Wholesale Insulation Supply, Inc., petitioner, Respondent, vs. Mark Sommerville, et al., Appellants.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2002).

STATE OF MINNESOTA

IN COURT OF APPEALS

A03-207

Wholesale Insulation Supply, Inc., petitioner,

Respondent,

vs.

Mark Sommerville, et al.,

Appellants.

Filed September 9, 2003

Affirmed

Toussaint, Chief Judge

Ramsey County District Court

File No. C8-01-11337

John F. Wagner, McDonough, Wagner & Ho, LLP, 14501 Granada Drive, Suite 200, Apple Valley, MN 55124 (for respondent)

John Garrett Westrick, 400 Minnesota Building, 46 East Fourth Street, St. Paul, MN 55101 (for appellants)

            Considered and decided by Kalitowski, Presiding Judge, Toussaint, Chief Judge, and Schumacher, Judge.

U N P U B L I S H E D   O P I N I O N

TOUSSAINT, Chief Judge

            Appellant alleges that the district court erred when it permanently enjoined him from using the business name "Insulation Supplies."  Because the appellant has never used the name "Insulation Supplies" for business purposes, he has not demonstrated that he has a protectable interest in the name, and we affirm.

F A C T S

            In 1986, respondent Wholesale Insulation Supply, Inc. (Wholesale) purchased the assets and trade name of Insulation Supplies, Inc.  Following the purchase, Wholesale began using the name "Insulation Supplies" in its business of selling wholesale and retail insulation to builders and the general public.  Wholesale has continued to use the name "Insulation Supplies" on its stationery, business cards, yellow-pages advertisements, work orders, credit applications, accounts receivable billing, and all other corporate documents.

            Insulation Supplies, Inc. failed to file its annual corporate registrations as required under Minnesota law and was involuntarily dissolved in 1991.  Although it was operating under the name "Insulation Supplies," Wholesale never registered the name with the Minnesota Secretary of State.  From 1995 to 2001, appellant Mark Sommerville reserved the name "Insulation Supplies" with the secretary of state.  Wholesale learned of the reservation in 2001 and contested Sommerville's use of the name.  While the secretary of state was considering Wholesale's name contest, Sommerville incorporated a business named "Insulation Supplies, Inc."  The secretary of state decided the name contest in favor of Wholesale and ordered Sommerville to change the name of his business.  Sommerville appealed the secretary's decision and, after a trial to the court, Sommerville was permanently enjoined from using the name "Insulation Supplies."  Sommerville moved for post-trial relief, which the district court denied, and he now appeals from the district court's order. 

D E C I S I O N

            When the district court has determined a mixed question of fact and law, the reviewing court will affirm if the findings of fact "are not without support in the evidence" and if the conclusion based on those facts is not contrary to the law.  Colburn v. Pine Portage Madden Bros., 346 N.W.2d 159, 161 (Minn. 1984).

            Sommerville argues that the district court erred in enjoining him from using the name "Insulation Supplies" because he had lawfully reserved the name with the secretary of state.  "While registration or reservation of a trade name is prima facie evidence of the validity, ownership, and right to use the name, that registration creates a rebuttable presumption; the owner still must prove infringement of the trade name to which he claims the ‘right.'"  State by Anderson v. Reward Corp., 482 N.W.2d 815, 819 (Minn. App. 1992) (citation omitted), review denied (May 15, 1992).  The owner of a registered trade name must present evidence of actual use of the trade name in business, in advertising, or in sale of goods to establish a protectable interest; registration alone is not sufficient.  Id.  "No rights accrue to one who merely selects a trademark without actual use of it in the advertising or sale of goods."  Id. (quoting Aveda Corp. v. Evita Mktg. Corp., 706 F. Supp. 1419, 1427 (D. Minn. 1989)). 

            The record supports the district court's finding that Sommerville has never actively used the trade name "Insulation Supplies."  Although Sommerville reserved the name "Insulation Supplies," he admitted at trial that he has never used the name for business purposes.  The record shows that Sommerville has never educated the public about his product through advertising and has not developed any reputation, any recognition, or any goodwill of his business.  In contrast, Wholesale has consistently used the name "Insulation Supplies" in the course of commerce for over 16 years.  Thus, Sommerville has not established that he has a protectable interest in the name "Insulation Supplies," and the district court did not err in permanently enjoining him from using the name.

            Affirmed.