Mars, Incorporated v. The Hershey Company, No. 14-cv-00399 (E.D.Va) Answer and Counterclaims filed...

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IN THE UNITED STATES DISTRICT COURTFOR THE EASTERN DISTRICT OF VIRGINIA

ALEXANDRIA DIVISION

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Plaintiff andCounterclaim-Defendant,

v.

THE HERSHEY COMPANY andHERSHEY CHOCOLATE & CONFECTIONARYCORPORATION,

Defendants andCounterclaim-Plaintiffs.

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Civil Action No. 1:14-cv-00399-LO-TCB

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ANSWER AND COUNTERCLAIMS OF THE HERSHEY COMPANYAND HERSHEY CHOCOLATE & CONFECTIONERY CORPORATION

Defendants and Counterclaim-plaintiffs The Hershey Company (“Hershey Company”)

and Hershey Chocolate & Confectionery Corporation (“HC&CC”) (hereinafter collectively

referred to as “Hershey”), by and through their attorneys, for their Answer to the Complaint of

Mars, Incorporated (”Mars”) and their Counterclaims against Mars, plead as follows:

Introduction

1. Deny knowledge or information sufficient to form a belief as to the truth of the

allegations contained in paragraph 1 of the Complaint, except deny that consumers in the United

States or the territories under the jurisdiction and control of the United States associate

MALTESERS and the packaging in which the product is sold exclusively with Mars.

2. Deny the allegations of paragraph 2 of the Complaint, except admit that Hershey

purchased the U.S. rights to the trademark MALTESER in the 1990s for use in connection with

candy, that since then Hershey has made use of the trademark MALTESER in connection with

Case 1:14-cv-00399-LO-TCB Document 14 Filed 05/09/14 of 29 PageID# 55

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such products and that Hershey has lawfully maintained the registrations for the trademark with

the United States Patent and Trademark Office (“USPTO”).

3. Deny the allegations of paragraph 3 of the Complaint, except admit that the

trademark MALTESER (among many other marks owned by Hershey) has not been mentioned

in at least some filings by Hershey with the Securities and Exchange Commission (“SEC”).

4. Deny the allegations of paragraph 4 of the Complaint, except deny knowledge or

information sufficient to form a belief as to the second sentence of paragraph 4 of the Complaint.

PARTIES


allegations contained in paragraph 5 of the Complaint, except admit upon information and belief

that Mars manufactures and sells chocolate candy and that one of Mars’ products that is

manufactured and sold by Mars outside the United States is sold under the mark MALTESERS.

6. Deny the allegations of paragraph 6 of the Complaint, except admit the

allegations of the first sentence of paragraph 6 of the Complaint, and further state that The

Hershey Company has sold and sells chocolate candy under the trademark MALTESER in the

United States.

7. Deny the allegations of paragraph 7 of the Complaint, except admit the

allegations of the first sentence of paragraph 7 of the Complaint, and further state that HC&CC is

the record owner of three United States trademark registrations for trademarks comprising the

term MALTESER.

JURISDICTION AND VENUE

8. Deny the allegations of paragraph 8 of the Complaint, except admit that Mars

purports to assert claims under the trademark laws of the United States and the laws of Virginia,


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California and New York and admit that the Court has subject matter jurisdiction over the claims

purported to be asserted in Counts I and III-VI of the Complaint.

9. Deny the allegations of paragraph 9 of the Complaint, except admit that Hershey

has advertised, sold and shipped its products into Virginia and this judicial district, that the

USPTO is located in this judicial district, and that this Court has personal jurisdiction over

Hershey.

10. Deny the allegations of paragraph 10 of the Complaint, except admit that the

Court has venue over the claims purported to be asserted in the Complaint.

FACTUAL BACKGROUND


allegations contained in paragraph 11 of the Complaint, except admit upon information and

belief that Mars manufactures chocolate candy and sells chocolate candy in and outside the

United States.



belief that Mars sells chocolate candy under the marks Snickers, M&Ms, Milky Way, Twix and

3 Musketeers.


allegations contained in paragraph 13 of the Complaint.



belief that outside the United States Mars has sold candy under the MALTESERS mark.


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belief that Mars has sold MALTESERS candy outside the United States in the packaging

depicted in paragraph 15 of the Complaint, and deny that that packaging is distinctive.



belief that Mars has sold MALTESERS candy outside the United States in the packaging

depicted in paragraph 16 of the Complaint, and deny that that packaging is distinctive.







belief that, from time to time, in violation of Hershey’s rights in its MALTESER trademarks,

retailers in the United States have sold diverted or “grey goods” MALTESERS candy that

originates from outside the United States and that is not packaged for sale in the United States.








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23. Deny the allegations contained in paragraph 23 of the Complaint, except deny

knowledge or information sufficient to form a belief as to the truth of allegations regarding

trademark registrations for the MALTESERS mark or packaging outside the United States.

24. Deny the allegations contained in paragraph 24 of the Complaint.




belief that Leaf Brands, Inc. (collectively, with Leaf, Inc., “Leaf”) sold chocolate candy in the

United States under the trademark MALTESER and that Leaf registered the trademark

MALTESER in the USPTO.



belief that in 1993 Mars brought an action against Leaf in the United States District Court for the

District of Delaware, that Mars alleged, inter alia, that Leaf had not made bona fide use of the

MALTESER mark in commerce and had abandoned the mark, and that Mars later dismissed that

action with prejudice, and refer to the pleadings and documents filed in the action and to the

settlement agreement in that action for the contents thereof.

28. Deny the allegations contained in paragraph 28 of the Complaint, except admit

that in or about December 1996, Leaf assigned its MALTESER mark to Huhtamaki Finance

B.V. (“Huhtamaki”) and refer to the assignment for the contents thereof.


that in or about June 1998 Huhtamaki assigned its MALTESER mark to Hershey’s affiliate


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Homestead, Inc., and that in 1998 Hershey was selling a chocolate candy under the trademark

WHOPPERS.



that, like many other Hershey products, MALTESER products have not been mentioned in at

least some filings by Hershey with the SEC, have not been referred to on any HERSHEY social

media accounts, and have not been mentioned on the hersheycompany.com web site; admit that

HERSHEY does not advertise or sell MALTESERS products in foreign countries because

Hershey is aware that Mars claims rights in foreign countries; and deny knowledge or

information sufficient to form a belief as to the truth of the allegation that “no news stories refer

to Hershey’s use of the mark MALTESER in the United States.”



that HC&CC has submitted Statements of Continuing Use, Renewal Affidavits and Combined

Affidavits of Use and Incontestability to the USPTO with respect to its MALTESER trademark

registrations and refer to such documents for the contents thereof.


that on or about December 1, 2000 HC&CC submitted a Combined Affidavit of Use and Incon-

testability to the USPTO with respect to its MALTESER trademark, Registration No. 1,923,905,

and refer to the affidavit for the contents thereof.


that on or about May 15, 2003 HC&CC submitted a Combined Declaration of Use and Incon-


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testability to the USPTO with respect to its MALTESER trademark, Registration No. 761,679,

and refer to the declaration for the contents thereof.


that on or about June 16, 2005 HC&CC submitted a Combined Declaration of Use and Incon-

testability to the USPTO with respect to its MALTESER trademark, Registration No. 1,923,905,

and refer to the declaration for the contents thereof.


that on or about March 8, 2011 HC&CC submitted a Trademark Statement of Use to the USPTO

with respect to its MALTESER trademark, Serial No. 85,027,320, and refer to the statement for

the contents thereof.


that on or about December 18, 2012 HC&CC submitted a Combined Declaration of Use and

Application for Renewal of Registration of Mark to the USPTO with respect to its MALTESER

trademark, Registration No. 761,679, and refer to the declaration for the contents thereof.



that at various times Hershey sold candy in the United States under its MALTESER trademark in

the packaging depicted in paragraph 40 of the Complaint.


that at various times Hershey has sold candy in the United States under its MALTESER

trademark in the packaging depicted in paragraph 41 of the Complaint.

42. Deny the allegations contained in paragraph 42 of the Complaint and refer to the

MALTESER packaging and the MALTESERS packaging for the contents thereof.


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43. Deny the allegations contained in paragraph 43 of the Complaint and refer to the

MALTESER packaging and the MALTESERS packaging for the contents thereof.


45. Deny the allegations contained in paragraph 45 of the Complaint and refer to

Exhibit A to the Complaint for the contents thereof.

46. Deny the allegations contained in paragraph 46 of the Complaint and refer to

Exhibit B to the Complaint for the contents thereof.

COUNT I(15 U.S.C. § 1125)

47. Hershey repeats and realleges paragraphs 1-46 above as if fully set forth herein.







COUNT II(15 U.S.C. § 1119)








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COUNT III(15 U.S.C. § 1120)






COUNT IV(Virginia Law)







COUNT VI(California Law)








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COUNT VI(New York Law)








AFFIRMATIVE DEFENSES

By alleging the defenses set forth below, Hershey does not assert or admit that Hershey

has the burden of proof and/or persuasion with respect to any of these defenses.

FIRST AFFIRMATIVE DEFENSE

The Complaint fails to state a claim upon which relief may be granted.

SECOND AFFIRMATIVE DEFENSE

The Complaint is barred, in whole or in part, because Mars has not sustained any injury

or damage by reason of any alleged unlawful actions of Hershey.

THIRD AFFIRMATIVE DEFENSE

The Complaint is barred, in whole or in part, by the applicable statute of limitations.

FOURTH AFFIRMATIVE DEFENSE

The Complaint is barred, in whole or in part, by the doctrines of laches and acquiescence.

FIFTH AFFIRMATIVE DEFENSE

The Complaint is barred, in whole or in part, by the doctrines of estoppel and unclean

hands.


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SIXTH AFFIRMATIVE DEFENSE

The Complaint is barred, in whole or in part, by the doctrine of res judicata.

SEVENTH AFFIRMATIVE DEFENSE

The Court lacks subject matter jurisdiction over Count II of the Complaint because at the

time of the filing of the Complaint there was no ongoing action that involved the trademark

registrations of which Count II seeks cancelation.

EIGHTH AFFIRMATIVE DEFENSE

Counts IV, V and VI of the Complaint are preempted by the Lanham Act and the

Supremacy Clause of the United States Constitution.

NINTH AFFIRMATIVE DEFENSE

The Complaint is barred, in whole or in part, because Hershey’s rights in the

MALTESER mark in the United States and the territories under the jurisdiction and control of

the United States are superior to any rights claimed by Mars in the MALTESERS mark in the

United States and the territories under the jurisdiction and control of the United States, and any

alleged rights of Mars in the MALTESERS mark in the United States or the territories under the

jurisdiction and control of the United States are subject to and foreclosed by Hershey’s prior and

pre-existing rights in the MALTESER mark.

TENTH AFFIRMATIVE DEFENSE

The Complaint is barred, in whole or in part, to the extent that Mars relies on any alleged

rights in the MALTESERS mark accruing prior to its settlement with Leaf, because Mars waived

at that time any claim that its alleged MALTESERS rights in the United States and the territories

under the jurisdiction and control of the United States were superior to Leaf’s MALTESER


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rights in the United States and the territories under the jurisdiction and control of the United

States and consented to Leaf’s continued use of the MALTESER mark.

COUNTERCLAIMS

Counterclaim-plaintiffs The Hershey Company and Hershey Chocolate & Confectionery

Corporation (“HC&CC”) (hereinafter collectively referred to as “Hershey”), for their counter-

claims against counterclaim-defendant Mars, Incorporated (“Mars”) for trademark infringement,

false designation of origin, false endorsement and declaratory, injunctive and other relief, plead

and allege as follows:

NATURE AND BASIS OF THESE COUNTERCLAIMS

1. This action is brought by Hershey against Mars under the Lanham Act, 15 U.S.C.

§§ 1114 and 1125, and state law, seeking injunctive, declaratory and other relief relating to

Mars’ alleged unauthorized and intended use of the mark MALTESERS in the United States in

connection with chocolate candy. In doing so, Mars has acted with the knowledge that Hershey

previously used, and continues to use, the mark MALTESER in connection with chocolate candy

in the United States, owns federal registrations covering the mark MALTESER, and traces its

rights in the MALTESER marks to a predecessor-in-interest whose rights in the MALTESER

marks Mars previously challenged in court, in a case that, by Mars’ own admission, was

dismissed with prejudice. Unable to launch its MALTESERS brand in the United States because

of Hershey’s predecessor rights, Mars instead has launched this lawsuit making unfounded

allegations about Hershey’s alleged failure to use its MALTESER trademarks or its alleged

abandonment of the marks. Mars’ threatened use of the mark MALTESERS is likely to confuse

consumers into believing that Mars’ MALTESERS candy and Hershey’s MALTESER candy


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have a common source or are endorsed by, or affiliated with, Hershey or a common source, and

will injure Hershey’s goodwill and reputation.

PARTIES

2. The Hershey Company is a corporation organized and existing under the laws of

the State of Delaware, with its principal place of business at 100 Crystal A Drive, Hershey,

Pennsylvania 17033. The Hershey Company is a major manufacturer and seller of chocolate and

candy confectionery and chocolate-related grocery products and snacks.

3. HC&CC is a corporation organized and existing under the laws of the State of

Delaware, with its principal place of business at 4860 Robb Street, Wheat Ridge, Colorado

80033. HC&CC is a wholly-owned subsidiary of The Hershey Company. HC&CC owns and

has licensed The Hershey Company to use its MALTESER trademarks upon which these count-

erclaims are based.

4. On information and belief, defendant Mars is organized and existing under the

laws of the State of Delaware, with its principal place of business in McLean, Virginia. Mars

manufactures and sells chocolate candy, including chocolate candy under the trademark

MALTESERS that Mars manufactures and sells outside the United States, and, according to the

allegations in Mars’ Complaint, Mars also sells to duty free stores in certain United States

airports.

JURISDICTION AND VENUE

5. The Court has subject matter jurisdiction over Hershey’s trademark infringement,

false designation of origin and false endorsement claims and claim for a declaration of trademark

validity and ownership pursuant to the Lanham Act, 15 U.S.C. § 1121, and 28 U.S.C. §§ 1331,


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and 1338(a) & (b). The Court has supplemental jurisdiction over the claims arising under state

law pursuant to 28 U.S.C. § 1367.

6. These Counterclaims also arise, in part, under the Declaratory Judgment Act, 28

U.S.C. §§ 2201 and 2202. An actual, substantial and continuing justiciable controversy exists

between Hershey and Mars regarding Hershey’s use and registration of its MALTESER trade-

marks in the United States Patent and Trademark Office (“USPTO”) and regarding Mars’ alleged

use and common law trademark rights to the mark MALTESERS in the United States and the

territories under the jurisdiction and control of the United States.

7. The Court has personal jurisdiction over Mars because, on information and belief,

Mars is a citizen of the State of Virginia, is present and doing business in the State of Virginia,

and it has consented to the jurisdiction of this Court by commencing this action in this Court.

8. Venue is appropriate in this Court pursuant to 28 U.S.C. § 1391 because Mars is

subject to personal jurisdiction in this Judicial District, because a substantial part of the events

giving rise to Hershey’s claims occurred in this Judicial District, and because Mars has

consented to the venue of this Court by commencing this action in this Court.

ALLEGATIONS COMMON TO ALL COUNTERCLAIMS

Hershey and Its MALTESER Trademarks

9. Hershey manufactures and sells candy, chocolate, confectionery, cocoa, snacks

and other products under the well-known and famous HERSHEY’S trademark, which is owned

by HC&CC. Hershey also has long-established rights in the trademark MALTESER in connec-

tion with chocolate candy products.

10. On information and belief, on or about January 11, 1962, Leaf Brands, Inc.

(collectively, with Leaf, Inc., “Leaf”) began using the mark MALTESER in United States


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commerce in connection with chocolate candy. On December 17, 1963, the United States Patent

and Trademark Office (“USPTO”) issued a federal trademark registration to Leaf for the

trademark MALTESER, Registration No. 761,679, for candy. Thereafter, Leaf continued to use

the trademark MALTESER and sold chocolate candy in connection with this mark in United

States commerce. An example of an early wrapper for Leaf’s product is shown here:


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11. On information and belief, on or about January 31, 1974, Leaf began using the

mark MALTESER in the following stylized form in United States commerce in connection with

chocolate candy:

On October 3, 1995, the USPTO issued a federal trademark registration to Leaf for this stylized

trademark MALTESER, Registration No. 1,923,905, for candy.

12. Thereafter, on information and belief, Leaf continued to use the MALTESER

trademark and sold chocolate candy in connection with this mark in United States commerce.

Examples of other packaging for Leaf’s MALTESER products are set forth immediately below:


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13. In December, 1996, Leaf assigned the MALTESER trademark and Registration

Nos. 761,679 and 1,923,905 and associated goodwill to Huhtamaki Finance B.V. (“Huhtamaki”),

which then granted an exclusive license to Homestead, Inc. (“Homestead”), an affiliate of

Hershey, to produce, market, advertise, promote, sell, distribute or offer for sale products under

the MALTESER mark in, inter alia, the United States.

14. Effective June 30, 1998, Huhtamaki assigned the MALTESER trademark and

Registration Nos. 761,679 and 1,923,905 and associated goodwill to Homestead. Effective

February 28, 1999, Homestead merged into and with HC&CC under the name of Hershey

Chocolate & Confectionary Corporation.

15. After the December 1996 assignment of the MALTESER trademark from Leaf to

Huhtamaki, The Hershey Company, as sublicensee of Homestead and then HC&CC, used the

trademark MALTESER and sold chocolate candy in connection with the mark in commerce in

the United States, as shown below:

16. On or about June 30, 2010, The Hershey Company, under license from HC&CC,

began using the mark MALTESER in United States commerce in connection with ice cream. On

September 20, 2011, the USPTO issued a federal trademark registration to HC&CC for the

trademark MALTESER, Registration No. 4,029,606, for ice cream. The Hershey Company,


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under license from HC&CC, has continued to use the trademark MALTESER for chocolate

products, as shown below, in commerce in the United States:

17. Hershey’s MALTESER trademarks are unique and distinctive in the United

States. Hershey has used these trademarks in connection with its products and business, and has

advertised and promoted its products under these marks. Hershey’s U.S. Trademark Registration

Nos. 761,679 and 1,923,905 have become incontestable and are entitled to the fullest protection

under the federal Lanham Act and state law.

Mars’ Acquiescence in the Use and Registrationof Leaf’s and Hershey’s MALTESER Trademarks

18. Between 1936 (when Mars alleges it first used the MALTESERS mark, in the

United Kingdom) and 1962, when Leaf applied to register and commenced use of its

MALTESER mark in the United States, Mars neither filed any application to register

MALTESERS in the United States nor commenced use of the MALTESERS mark in the United

States so as to attempt to establish rights in that mark in the United States.


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19. At no time ever prior to June 2, 1993 did Mars seek to cancel any MALTESER

trademark registration of Leaf.

20. At no time ever prior to June 2, 1993 did Mars file any action to cancel any

MALTESER trademark registration of Leaf.

21. At no time ever prior to June 2, 1993 did Mars seek to stop Leaf from using the

MALTESER trademarks.

22. At no time ever prior to June 2, 1993 did Mars file any action to stop Leaf from

using the MALTESER trademarks.

23. On June 2, 1993 Mars commenced an action in the United States District Court

for the District of Delaware alleging that Leaf had abandoned the trademark through non-use and

asking that Leaf’s U.S. Registration Nos. 761,679 and 1,923,905 for the MALTESER trademarks

be canceled for alleged lack of use of the trademarks.

24. With Mars’ consent, the action was dismissed with prejudice on April 22, 1994,

without any agreement by Leaf to cease use of the MALTESER trademark.

25. Following dismissal of Mars’ lawsuit against Leaf, Leaf’s MALTESER trademark

registrations were not canceled, and the registrations thereafter remained on the Principal

Register of the USPTO.

26. For the next two decades, from April 22, 1994 until it commenced this action on

April 15, 2014, Mars took no action to cause Leaf, Hershey or any predecessor owner of the

MALTESER trademarks to stop use of the marks; nor did it petition the USPTO or any court to

cancel the registrations.

27. On the same day on which it commenced this action, Mars filed an application

with the USPTO, Serial No. 76,716,187, for registration of the mark MALTESERS for use in


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connection with candy, claiming that it first used the mark in United States commerce “at least as

early as 1995.”

28. In connection with its trademark application, Mars filed a sworn declaration by

the President of Mars Chocolate North America, asserting that “to the best of [her] knowledge

and belief no other person, firm, corporation or association has the right to use the . . . mark in

commerce, either in identical form or in such near resemblance thereto as may be likely, when

used on or in connection with the goods or services of such other person, to cause confusion, or

to cause mistake, or to deceive.”

29. In connection with its trademark application, Mars did not refer to, or otherwise

inform the USPTO of, Hershey’s MALTESER marks or registrations. Nor did Mars file a

petition in the USPTO to cancel the Hershey MALTESER registrations.

Mars’ Unlawful Misappropriation of Hershey’s MALTESER Marks

30. Mars alleges in its complaint in this action that outside the United States it has

sold hundreds of millions of dollars worth of products under the MALTESERS mark, and alleges

that its MALTESERS-branded products “have been sold” or “are sold” (by third parties,

presumably) in the United States. Mars, however, alleges that it has been “hindered” from

selling MALTESERS-branded products in this country by the use and registration of the

MALTESER marks by Hershey and the predecessor owners of the MALTESER marks and

registrations.

31. Mars’ first attempt to enter the United States market lawfully was its 1993 lawsuit

against Leaf, in which Mars alleged that Leaf had ceased use of the MALTESER mark in United

States commerce and had abandoned them. The facts, however, were otherwise, and Mars was

forced to dismiss its lawsuit with prejudice and enter into a settlement without any agreement by


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Leaf to cease use of the MALTESER trademark or to cancel Leaf’s MALTESER trademark

registration.

32. Now, twenty years later, Mars has made it abundantly clear in its complaint in this

action, in its application for registration to the USPTO, in statements to the press and otherwise

that it intends to use in United States commerce the mark MALTESERS in connection with

chocolate candy (and makes some vague allegations that it may have used the MALTESERS

mark in the United States, at least in certain duty free shops). By this lawsuit and its application

to obtain a federal trademark registration of the MALTESERS mark, Mars is attempting the

same desperate gambit it tried two decades before in its unsuccessful suit against Leaf – making

false claims of abandonment in an effort to steal Hershey’s rights to the MALTESER trademarks

so that Mars can, finally, lawfully sell products under the MALTESERS mark in this country

instead of, as the law requires, adopting a new name that is not confusingly similar to Hershey’s

MALTESER marks.

Mars’ Alleged and Intended Unauthorized Use ofHershey’s MALTESER Marks Is Likely to Cause Confusion

33. Mars is not now and never has been authorized by Hershey, Hershey’s affiliates

or the predecessor owners of the MALTESER marks to use the marks in United States com-

merce in connection with candy or any other product.

34. To the extent Mars is using its MALTESERS mark in the United States,

Hershey’s MALTESER trademarks, for all of the reasons set forth above, have trademark

priority, and it is Mars’ MALTESERS mark that infringes Hershey’s MALTESER trademarks.

35. Mars’ use of the MALTESERS mark is likely to cause confusion, mistake or

deception of actual and potential purchasers and the consuming public as to the source, origin,


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sponsorship, affiliation or approval of Mars’ products under the MALTESERS mark and

Hershey’s products under the MALTESER marks.

36. Mars’ acts are causing and will continue to cause damage and irreparable harm to

Hershey and to its valuable reputation and goodwill with purchasers and consumers.

FIRST CLAIM FOR RELIEFInfringement of Federally Registered Mark

(15 U.S.C. § 1114(1)(a))

37. Hershey repeats and realleges paragraphs 1 through 36 of these Counterclaims as

if fully set forth herein.

38. This claim is for the infringement of a trademark registered in the United States

Patent and Trademark Office, pursuant to Section 32(1) of the Lanham Act, 15 U.S.C. §

1114(1)(a), as amended.

39. Mars’ MALTESERS mark is confusingly similar to, and a colorable imitation of,

Hershey’s federally registered MALTESER marks and infringes Hershey’s trademark registra-

tions covering those marks. Mars’ unauthorized use of its MALTESERS mark is likely to cause

confusion and mistake and to deceive the public as to the approval, sponsorship, license, source

or origin of Mars’ and Hershey’s products.

40. On information and belief, Mars’ acts of trademark infringement have been or,

unless enjoined, will be done willfully and deliberately and Mars has profited and been unjustly

enriched or, unless enjoined, will profit and be unjustly enriched by sales that Mars would not

otherwise have made but for its unlawful conduct.

41. Mars’ acts described above have caused injury and damages to Hershey, and have

caused or, unless enjoined, will cause irreparable injury to Hershey’s goodwill and will continue

to cause further irreparable injury, whereby Hershey has no adequate remedy at law.


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SECOND CLAIM FOR RELIEFFalse Designation of Origin and Unfair Competition

(15 U.S.C. § 1125(a))



43. This claim is for false designation of origin and unfair competition in violation of

Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a).

44. Mars’ unauthorized use or, unless enjoined, future use of the mark MALTESERS

falsely designates the origin of Mars’ products and services and permits Mars to compete

unfairly with Hershey, in violation of 15 U.S.C. § 1125(a).

45. On information and belief, Mars’ acts of false designation of origin and unfair

competition have been or, unless enjoined, will be done willfully and deliberately and Mars has

profited and been unjustly enriched or, unless enjoined, will profit or be unjustly enriched by

sales that it would not otherwise have made but for its unlawful conduct.

46. Mars’ acts described above have caused injury and damages to Hershey, and have

caused or, unless enjoined, will cause irreparable injury to Hershey’s goodwill and reputation,

and will continue to cause further irreparable injury, whereby Hershey has no adequate remedy

at law.

THIRD CLAIM FOR RELIEFDeclaratory Judgment as to Hershey’s MALTESER Trademarks and Registrations



48. In this action, Mars has asserted that Hershey’s U.S. Trademark Registration Nos.

761,769, 1,923,905 and 4,029,606 for Hershey’s MALTESER trademarks should be canceled on

the grounds that HC&CC and its predecessors allegedly stopped use of the MALTESER


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trademarks on or in connection with candy with the intent not to resume use and/or made only

bad faith, token use of the marks to reserve rights to the mark. Mars has further asserted that

HC&CC intentionally made false, material statements to the USPTO in order to induce it to issue

and/or allow HC&CC to maintain such registrations and that, but for such statements, the

USPTO would not have allowed HC&CC to secure Registration No. 4,029,606, would not have

allowed HC&CC to maintain Registration Nos. 761,769 and 1,923,905, and would not have

awarded incontestable status to Registration No. 1,923,905.

49. Based on the foregoing allegations, there exists between Hershey and Mars a

controversy of sufficient immediacy and reality to warrant declaratory relief.

50. Pursuant to 28 U.S.C. §§ 2201 and 2202, and for all the reasons set forth above,

Hershey is entitled to the issuance of a declaratory judgment declaring that Hershey’s

MALTESER trademarks and the MALTESER Registered Trademarks are valid and subsisting,

that HCC&C and its predecessors did not commit fraud on the USPTO, and that Hershey is the

rightful owner of the MALTESER trademarks and Registered Trademarks.

FOURTH CLAIM FOR RELIEFDeclaratory Judgment as to Mars’ Absence of Rights to the MALTESERS Mark



52. In this action, Mars has asserted that it has advertised and sold candy in the

United States in connection with the mark MALTESERS, that consumers in the United States

associate the mark MALTESERS with goods sold by Mars, and that Mars owns common law

trademark rights for the mark MALTESERS for candy in the United States.

53. On information and belief, Mars’ first use of the mark MALTESERS in

connection with the sale of candy in the United States or in any territory under the jurisdiction


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and control of the United States was after Hershey or its predecessors made first use of the mark

MALTESER in connection with candy in the United States or in any territory under the

jurisdiction and control of the United States or otherwise established trademark priority in the

United States.

54. Because Hershey has priority of rights over Mars, Mars does not own common

law trademark rights for the mark MALTESERS for candy in the United States or in any

territory under the jurisdiction and control of the United States.

55. Based on the foregoing allegations, there exists between Hershey and Mars a

controversy of sufficient immediacy and reality to warrant declaratory relief.

56. Pursuant to 28 U.S.C. §§ 2201 and 2202, Hershey is entitled to the issuance of a

declaratory judgment declaring that Mars has no common law trademark rights to the mark

MALTESERS.

WHEREFORE, Hershey prays that this Court enter judgment as follows:

A. That judgment be entered in Hershey’s favor on each Claim in the Complaint.

B. That judgment be entered in Hershey’s favor on each Counterclaim.

C. Granting permanent injunctive relief restraining Mars, its officers, directors,

agents, employees, servants, attorneys, successors, assigns and others controlling, controlled by

or affiliated with Mars and all those in privity or active concert or participation with any of the

foregoing, and all those who receive actual notice by personal service or otherwise:

(1) from using in the United States and its territories and possessions, orally,

in writing or in any media, the name, word or mark MALTESERS or any

other name, word or mark confusingly similar to Hershey’s MALTESER

marks for any purpose; and


61999977.docx 26

(2) from otherwise competing unfairly with Hershey;

B. Declaring that U.S. Trademark Registration Nos. 761,769, 1,923,905 and

4,029,606 and the trademarks that are the subject of such registrations are valid and subsisting

and that Hershey is the rightful owner of such registrations and trademarks;

C. Declaring that Mars has no rights to any trademark containing the term

MALTESERS in the United States or in any territories under the jurisdiction and control of the

United States;

D. Ordering Mars to pay for and cause to be disseminated corrective advertising to

ameliorate the adverse consequences of Mars’ acts of trademark infringement, false designation

of origin and unfair competition, the content, nature, form and extent of which is to be approved

by Hershey and this Court;

E. Ordering Mars to recall from all chains of distribution all goods, product packa-

ging, promotional materials, advertisements, commercials, infomercials and other items, the

dissemination by Mars of which would violate the injunction herein granted;

F. Ordering Mars to deactivate all web sites and deliver up for destruction any and

all goods, product packaging, promotional materials, advertisements, commercials and other

items in the possession, custody or control of Mars which, if sold, displayed or used, would

violate the injunction herein granted;

G. Ordering an accounting of all gains, profits, savings and advantages realized by

Mars from its aforesaid acts of trademark infringement, false designation of origin and unfair

competition;

H. Awarding such damages as Hershey shall establish in consequence of Mars’

aforesaid acts of trademark infringement, false designation of origin, false endorsement and


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unfair competition, together with appropriate interest thereon, including three times the amount

found as actual damages by the trier of fact to properly compensate Hershey for its damages,

pursuant to 15 U.S.C. § 111(a);

I. Awarding Hershey punitive damages as permitted under Virginia law;

J. Ordering that, pursuant to Section 34(a) of the Lanham Act, 15 U.S.C. § 1116(a),

Mars shall serve upon Hershey within thirty (30) days after service on Mars of an injunction, or

such extended period as the Court may direct, a report in writing under oath setting forth in detail

the manner and form in which Mars has complied with the injunction;

K. Awarding Hershey its costs and expenses of this action;

L. Declaring that this is an exceptional case, pursuant to 15 U.S.C. § 1117, because

of the willful and deliberate nature of Mars’ acts of trademark infringement, false designation of

origin, false endorsement and unfair competition, and awarding Hershey its reasonable attorneys’

fees;

M. Awarding Hershey prejudgment and post-judgment interest on any monetary

award in this action; and

N. Granting such other and further relief as this Court may deem just and proper.


61999977.docx 28

Dated: May 9, 2014

Of Counsel

Paul C. LlewellynRichard A. De SevoKAYE SCHOLER LLP425 Park AvenueNew York, NY 10022(212) 836-8000

Steven A. ZalesinMichelle W. CohenPATTERSON BELKNAP

WEBB & TYLER LLP1133 Avenue of the AmericasNew York, New York 10036212-336-2000

/s/________________________John David Taliaferro (I.D. No. 71502)Attorney for The Hershey Company andHershey Chocolate & ConfectioneryCorporationKAYE SCHOLER LLP901 Fifteenth Street, N.W.Washington, D.C. 20005-2327Tel: (202) 682-3664Fax: (202) [email protected]


CERTIFICATE OF SERVICE

I hereby certify that on the 9th day of May, 2014, I will electronically file the foregoing

with the Clerk of Court using the CM/ECF system, which will then send a notification of such

filing (NEF) to the following:

Mary D. HallermanMcDermott Will & Emery LLPThe McDermott Building500 N. Capitol St, NWWashington, DC [email protected]

Katie BukrinskyMcDermott Will & Emery LLPThe McDermott Building500 N. Capitol St, NWWashington, DC [email protected]

/s/J.D. Taliaferro, Esq. (I.D. No. 71502)Attorney for The Hershey Company and HersheyChocolate & Confectionery CorporationKAYE SCHOLER LLP901 Fifteenth St. NWWashington, DC 20005TEL: (202) 682-3664FAX: (202) [email protected]


Mars, Incorporated v. The Hershey Company, No. 14-cv-00399 (E.D.Va) Answer and Counterclaims filed...

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