Nasalok Coating Corp. v. Nylok Corp.

Brief Fact Summary.

Nylok Corp. (Nylok), a U.S. company, sued Nasalok Coating Corp., a Korean company with a U.S. consumer base, for infringing its trademark in the United States District Court in the Northern District of Illinois.

Synopsis of Rule of Law.

Trademark invalidity is not a compulsory counterclaim under FRCP 13(a) and will not be waived if it is not filed in a trademark infringement suit.

Facts.

Nylok Corp. (Nylok), a U.S. company, sued Nasalok Coating Corp. (Nasalok), a Korean company with a U.S. consumer base, for infringing its trademark in the United States District Court in the Northern District of Illinois. The district court entered a default judgment against Nasalok. Nasalok sought a cancellation of Nylok’s trademark claiming that the trademark was fraudulently obtained. Summary judgment was granted to Nylok.

Issue.

Whether a counterclaim of trademark invalidity will be waived if it is not filed in a trademark infringement suit?

Held.

No. Summary judgment in favor of Nylok is affirmed. Nasalok’s claim is prohibited under claim preclusion because Nasalok’s invalidity claim was a collateral attack on the district court’s judgment that Nylok’s trademark was valid.

Discussion.

Trademark invalidity is not a compulsory counterclaim under FRCP 13(a) and will not be waived if it is not filed in a trademark infringement suit.