No.

17-1173

IN THE
United States Court of Appeals
for the Tenth Circuit
_______________
C5 MEDICAL WERKS, LLC and COORSTEK MEDICAL, LLC,
Plaintiffs-Appellees,
v.
CERAMTEC GMBH,
Defendant-Appellant.
_______________
On Appeal from the
United States District Court for the District of Colorado
Hon. R. Brooke Jackson
Case No. 1:14-cv-00643-RBJ
_______________
BRIEF FOR APPELLANT
_______________
Oral Argument Is Requested
CLAY C. JAMES JESSICA L. ELLSWORTH
HOGAN LOVELLS US LLP ANNA KURIAN SHAW
1601 Wewatta St. SEAN MAROTTA
Suite 900 KATHERINE B. WELLINGTON
Denver, CO 80202 HOGAN LOVELLS US LLP
(303) 899-7300 555 Thirteenth Street, N.W.
Washington, D.C. 20004
(202) 637-5600
[email protected]

Counsel for Defendant-Appellant

CeramTec GmbH
February 9, 2018
 CORPORATE DISCLOSURE STATEMENT
CeramTec GmbH is a German corporation. No publicly held corporation

owns ten percent or more of the stock of CeramTec GmbH.

i
 TABLE OF CONTENTS

Page

CORPORATE DISCLOSURE STATEMENT ..........................................................i

TABLE OF AUTHORITIES ....................................................................................iv

GLOSSARY OF TERMS ...................................................................................... viii

JURISDICTIONAL STATEMENT ..........................................................................1

INTRODUCTION .....................................................................................................1

STATEMENT OF ISSUES PRESENTED FOR REVIEW ......................................7

STATEMENT OF THE CASE..................................................................................7

SUMMARY OF ARGUMENT ...............................................................................19

STANDARD OF REVIEW .....................................................................................24

ARGUMENT ...........................................................................................................25

I. THE DISTRICT COURT LACKED PERSONAL

JURISDICTION OVER CERAMTEC ....................................................25

A. CeramTec’s Attendance At Three National And

International Conferences Hosted In Colorado
Is Insufficient To Establish Specific
Jurisdiction .....................................................................................27

B. There Is No Other Basis For Personal

Jurisdiction Over CeramTec In Colorado ......................................34

C. The District Court Lacked General Jurisdiction

Over CeramTec ..............................................................................39

II. THE DISTRICT COURT ERRED IN ITS

ANALYSIS OF THE FUNCTIONALITY OF THE
COLOR PINK ..........................................................................................40

A. The TrafFix Presumption Does Not Apply To

This Case ........................................................................................41

ii
 TABLE OF CONTENTS—Continued

Page

1. CeramTec’s ’816 Patent Claims A Range

Of Chromium, But Its Trade Dress
Claims Pink..........................................................................42

2. CeramTec’s ’816 Patent Claims

Compositions That Include A Range Of
Chromium, Resulting In Colors Other
Than Pink .............................................................................43

3. The Central Advance of the ’816 Patent

Related To Improving Tools for Cutting
Steel, Not Better Hip Joint Components ..............................45

B. The Color Pink Is Not Functional For Hip Joint

Components....................................................................................47

III. THE DISTRICT COURT’S ESTOPPEL RULING IS

CONTRARY TO TRAFFIX AND UNSUPPORTED
BY LEGAL AND EQUITABLE PRINCIPLES......................................51

CONCLUSION........................................................................................................58

STATEMENT REGARDING ORAL ARGUMENT

CERTIFICATE OF COMPLIANCE

CERTIFICATE OF DIGITAL SUBMISSION AND PRIVACY

REDACTION

ADDENDUM

CERTIFICATE OF SERVICE

iii
 TABLE OF AUTHORITIES
Page

CASES:
Asahi Metal Indus. Co. v. Superior Court,
480 U.S. 102 (1987)......................................................................................31, 32

Autogenomics, Inc. v. Oxford Gene Tech. Ltd.,

566 F.3d 1012 (Fed. Cir. 2009) ..........................................................................29

Avocent Huntsville Corp. v. Aten Int’l Co.,

552 F.3d 1324 (Fed. Cir. 2008) ..........................................................................36

Bell Helicopter Textron, Inc. v. Heliqwest Int’l, Ltd.,

385 F.3d 1291 (10th Cir. 2004) ....................................................................24, 27

Benton v. Cameco Corp.,

375 F.3d 1070 (10th Cir. 2004) ....................................................................31, 32

BNSF Ry. Co. v. Tyrrell,

137 S. Ct. 1549 (2017)..................................................................................22, 39

Bristol-Myers Squibb Co. v. Superior Court,

137 S. Ct. 1773 (2017)..................................................................................33, 36

Burger King v. Rudzewicz,

471 U.S. 462 (1985)............................................................................................27

Calphalon Corp. v. Rowlette,

228 F.3d 718 (6th Cir. 2000) ..............................................................................28

Campbell Pet Co. v. Miale,

542 F.3d 879 (Fed. Cir. 2008) ............................................................................30

Creative Consumer Concepts, Inc. v. Kreisler,

563 F.3d 1070 (10th Cir. 2009) ..........................................................................25

Daimler AG v. Bauman,
134 S. Ct. 746 (2014)..........................................................................................39

Disc Golf Association, Inc. v. Champion Discs, Inc.,

158 F.3d 1002 (9th Cir. 1998) ............................................................................53

iv
 TABLE OF AUTHORITIES—Continued

Page

Dudnikov v. Chalk & Vermilion Fine Arts, Inc.,

514 F.3d 1063 (10th Cir. 2008) ........................................................19, 25, 30, 34

Eco Manufacturing LLC v. Honeywell Int’l, Inc.,

295 F. Supp. 2d 854 (S.D. Ind. 2003).................................................................53

Eco Manufacturing LLC v. Honeywell Int’l, Inc.,

357 F.3d 649 (7th Cir. 2003) ..............................................................................53

Forney Indus., Inc. v. Daco of Missouri, Inc.,

835 F.3d 1238 (10th Cir. 2016) ............................................................................4

Fusion Entertainment v. Josh Agle, Inc.,

No. 07-cv-1651, 2008 WL 140489 (D. Colo. Jan. 11, 2008).............................34

Goodyear Dunlop Tires Operations, SA v. Brown,

564 U.S. 915 (2011)......................................................................................25, 39

Ideal Toy Corp. v. Plawner Toy Mfg. Corp.,

685 F.2d 78 (3d Cir. 1982) ...........................................................................50, 51

International Techs. Consultants, Inc. v. Euroglas S.A.,

107 F.3d 386 (6th Cir. 1997) ..............................................................................28

Johnson v. Lindon City Corp.,

405 F.3d 1065 (10th Cir. 2005) ..........................................................................55

Kehm Oil Co. v. Texaco, Inc.,

537 F.3d 290 (3d Cir. 2008) ...............................................................................34

Keys Youth Servs., Inc. v. City of Olathe,

248 F.3d 1267 (10th Cir. 2001) ..........................................................................24

McAirlaids, Inc. v. Kimberly-Clark Corp.,

756 F.3d 307 (4th Cir. 2014) ..................................................................42, 44, 48

Monge v. RG Petro-Mach. (Grp.) Co.,

701 F.3d 598 (10th Cir. 2012) ............................................................................28

v
 TABLE OF AUTHORITIES—Continued

Page

New World Int’l, Inc. v. Ford Global Techs.,

859 F.3d 1032 (Fed. Cir. 2017) ..........................................................................34

Noonan v. Winston Co.,

135 F.3d 85 (1st Cir. 1998)...................................................................................7

OMI Holdings, Inc. v. Royal Ins. Co. of Canada,

149 F.3d 1086 (10th Cir. 1998) ..........................................................................30

Patin v. Thoroughbred Power Boats Inc.,

294 F.3d 640 (5th Cir. 2002) ..............................................................................37

Qualitex Co. v. Jacobson Prods. Co.,

514 U.S. 159 (1995)........................................................... 5, 6, 23, 40, 49, 50, 51

Quarles v. Fuqua Indus., Inc.,

504 F.2d 1358 (10th Cir. 1974) ..........................................................................37

Ranza v. Nike, Inc.,

793 F.3d 1059 (9th Cir. 2015) ............................................................................37

Red Wing Shoe Co. v. Hockerson-Halberstadt, Inc.,

148 F.3d 1355 (Fed. Cir. 1998) ..............................................................21, 34, 35

SDJ Ins. Agency, LLC v. American Nat’l Ins. Co.,

292 F.3d 689 (10th Cir. 2002) ............................................................................55

Shrader v. Biddinger,
633 F.3d 1235 (10th Cir. 2011) ..........................................................................37

TrafFix Devices, Inc. v. Marketing Displays, Inc.,

532 U.S. 23 (2001).................................................... 4-7, 22-24, 40-46, 51-53, 57

Vornado Air Circulation Sys., Inc. v. Duracraft Corp.,

58 F.3d 1498 (10th Cir. 1995) ............................................................................52

Walden v. Fiore,
134 S. Ct. 1115 (2014)..................................................................................27, 33

vi
 TABLE OF AUTHORITIES—Continued

Page

Yahoo! Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme,

433 F.3d 1199 (9th Cir. 2006) ................................................................21, 34, 35

STATUTES:
15 U.S.C. § 1119........................................................................................................1

15 U.S.C. § 1121(a) ...................................................................................................1

28 U.S.C. § 1291........................................................................................................1

28 U.S.C. § 1331........................................................................................................1

28 U.S.C. § 1338........................................................................................................1

28 U.S.C. § 2201........................................................................................................1

RULES:
Fed. R. Civ. P. 4(k)(1)(A) ........................................................................................25

Fed. R. Civ. P. 52(b) ................................................................................................19

OTHER AUTHORITIES:
CoorsTek Medical, Contact Information, http://www.coorstekmedical.com/
ContactUs.aspx .....................................................................................................8

Meinhard Kuntz et al., The effect of microstructure and chromia

content on the properties of zirconia toughened alumina, 44:2
Ceramics International 2011 (Feb. 2018), available at
https://www.sciencedirect.com/science/article/pii/S027288421732
3507.....................................................................................................................13

STATEMENT OF PRIOR OR RELATED APPEALS

There are no prior or related appeals.

vii
 GLOSSARY OF TERMS

FDA U.S. Food and Drug Administration

PTO U.S. Patent and Trademark Office

ZTA ceramic A ceramic made from zirconia-toughened alumina

’816 patent U.S. Patent 5,830,816

’957 patent U.S. Patent 6,452,957

’970 patent U.S. Patent 8,932,970

viii
 No. 17-1173
_______________
IN THE
United States Court of Appeals
for the Tenth Circuit
_______________
C5 MEDICAL WERKS, LLC and COORSTEK MEDICAL, LLC,
Plaintiffs-Appellees,
v.
CERAMTEC GMBH,
Defendant-Appellant.
_______________
On Appeal from the
United States District Court for the District of Colorado
Hon. R. Brooke Jackson
Case No. 1:14-cv-00643-RBJ
_______________
BRIEF FOR APPELLANT
_______________

JURISDICTIONAL STATEMENT

The District Court had jurisdiction over this action under 28 U.S.C. §§ 1331,

1338, 2201, and 15 U.S.C. §§ 1119, 1121(a). The District Court entered an

amended final judgment disposing of the case on April 20, 2017, and CeramTec

GmbH filed a timely notice of appeal on May 19, 2017. A290-292, A293-295.

This Court has jurisdiction under 28 U.S.C. § 1291.

INTRODUCTION

This case is about the color pink. Appellant CeramTec GmbH (CeramTec)

is a German company that produces advanced technical ceramics, including

1
ceramic hip joint components for use in artificial hips. Since 2004, CeramTec’s

hip joint components have had an unusual and unique pink color, and surgeons

associate that color with CeramTec’s track record for safety. The year after

CeramTec’s pink products arrived on the market, Appellee C5 Medical Werks,

LLC (C5) was founded to produce ceramic products, including ceramic hip

implant components.1 C5 originally produced white hip implant components. But

over time, it decided to capitalize on the strong reputation that CeramTec’s pink

hip joint components had acquired by copying their pink color. To do that, C5

picked out paint swatches from Home Depot, color-matched CeramTec’s hip joint

components to the paint swatch called Cupid’s Arrow, and instructed the C5

research team to reverse engineer a product that was identical in color. C5’s

research team did. C5 then began manufacturing hip joint components in the

precise shade of pink of CeramTec’s products.

CeramTec has trademark rights in the color pink of its hip joint components

in Europe, and it has registered its trade dress for the color pink in the

Supplemental Register in the United States. When C5 showed up at a Paris trade

show in 2013 with a pink product that matched the color of CeramTec’s product,

CeramTec initiated enforcement activities in Europe. In 2014, C5 sued CeramTec

in C5’s then-home-state of Colorado, seeking cancellation of CeramTec’s U.S.

1
C5 later became CoorsTek Medical LLC (CoorsTek) and the two are referred to
collectively as C5.

2
trade dress rights and a declaration of non-infringement. CeramTec moved to

dismiss for lack of personal jurisdiction, given its nearly non-existent contacts with

Colorado. The District Court denied CeramTec’s motion, went on to conduct a

bench trial, and ruled in favor of C5.

This case never should have proceeded beyond the pleadings because the

District Court lacked personal jurisdiction over CeramTec. General jurisdiction

did not exist because CeramTec is not “at home” in Colorado; it is a German

company that, at the time the suit was filed, had no customers, employees, or

offices in Colorado. And specific jurisdiction did not exist either. Although

CeramTec had attended a few conferences at the Vail Cascade and at the

Broadmoor in Colorado Springs, C5 did not allege that CeramTec purposefully

directed its conference activities at Colorado. The conferences were hosted by

national and international orthopedic organizations and had a national and

international audience. There was also no allegation that C5’s suit sought to

remedy any harm caused by CeramTec’s attendance at these conferences. The

District Court accordingly lacked specific jurisdiction over CeramTec, and its

judgment should be reversed on that basis.

3
 If the Court reaches the merits, it should reverse the District Court’s

conclusion that CeramTec is not entitled to trade dress rights in the color pink.2

The District Court’s ruling is based primarily on an expired patent that, in one of

its claims, covers a ceramic composition having a combination of zirconia and

chromium in a specified ratio range. CeramTec’s pink hip joint components

practice this patent claim because they contain 0.33% chromium, which falls

within the claimed range. Using other amounts of chromium within the claimed

range results in other color compositions, and the patent does not claim or disclose

products of any particular color. But because the pink color of CeramTec’s

products comes from the 0.33% chromium they contain, the District Court

reasoned that pink is a functional product feature not entitled to trade dress

protection under TrafFix Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23, 29

(2001).

The District Court was mistaken. TrafFix sought to balance two competing

intellectual property regimes—patents and trade dress—by explaining that an

expired utility patent has “strong” evidentiary value in a claim of trade dress

infringement where trade dress protection is sought for the same feature claimed in

2
Trade dress is “an object’s total image and overall appearance, [which] may
include features such as size, shape, color or color combinations, texture, graphics,
or even particular sales techniques.” Forney Indus., Inc. v. Daco of Missouri, Inc.,
835 F.3d 1238, 1244 (10th Cir. 2016) (citation omitted and alteration in original).

4
the patent. Here, however, the two are different. CeramTec’s patent claims a

ceramic composition with a range of chromium and other ingredients. Using

different amounts of chromium within that range can result in a range of different

color ceramics (including almost-white, pink, red, and purple). CeramTec’s trade

dress, in contrast, is for the color pink. TrafFix’s evidentiary presumption has

nothing to say about whether the color pink is outside the bounds of trade dress.

Underscoring TrafFix’s inapplicability, the “central advance” of CeramTec’s

patent is that the claimed ceramic composition improves tools for cutting steel—a

widely divergent context from the pink hip joint components that are “the essential

feature of [its] trade dress.” Id. at 30.

To the extent the District Court looked beyond the patent, it concluded that

chromium (including in small quantities) is functional. A275, A285 n.7.3 That

asks and answers the wrong question. The relevant question is not whether

chromium is functional, but whether the color pink is functional for hip joint

components. Neither a pink product nor including 0.33% chromium is “essential

to the use or purpose,” or “affects the cost or quality,” of hip joint components.

Qualitex Co. v. Jacobson Prods. Co., 514 U.S. 159, 165 (1995) (defining

functionality in these terms). CeramTec presented evidence that ceramics made

with the range of chromium claimed in the expired patent—and thus with whatever
3
Confusingly, the court stated that its conclusion was a “legal” one, “not
necessarily a scientific one.” A279 n.5.

5
benefits are provided by that range of chromium—may be many colors other than

pink. Under Qualitex, this means that the color pink resulting from one specific

amount of chromium is not functional. And under a properly conducted

functionality analysis, the District Court should have come out the other way.

Finally, the District Court held that even if chromium is not functional,

CeramTec is estopped from saying so because of its patents and prior statements.

There are (at least) two major flaws in that holding. First, it contradicts the

Supreme Court’s decision in TrafFix, which permits a patent holder to present

evidence demonstrating that a feature claimed in a patent is not functional. And

second, it ignores that both parties’ positions on whether small amounts of

chromium are functional for hip joint components have changed over time. C5

spent many years telling its customers that chromium is not functional in ceramics

and that C5’s white chromium-free product was superior to its pink product with

0.33% chromium. Its opinion changed only at some point after it had filed this

suit. The District Court’s erroneous estoppel holding is another ground for

reversal.

6
 STATEMENT OF ISSUES PRESENTED FOR REVIEW

1. Whether the District Court wrongly held that CeramTec was subject

to personal jurisdiction in Colorado. See A75-90 (motion to dismiss); A175-184

(order).

2. Whether the District Court misapplied TrafFix and wrongly concluded

that the color pink is functional in ceramic hip joint components. See A269-289

(amended findings of fact and conclusions of law).

3. Whether the District Court contradicted TrafFix and wrongly held that

estoppel bars CeramTec from arguing that chromium is non-functional. See A269-

289 (amended findings of fact and conclusions of law).

STATEMENT OF THE CASE

The Parties. CeramTec is a German company that produces high quality

ceramics, including ceramic hip joint components. Third-party manufacturers

purchase those components and incorporate them into artificial hip joints, which

doctors use for hip replacement surgeries. A1544. CeramTec is incorporated and

headquartered in Germany, and at the time this suit was filed, it had no employees,

officers, or customers in Colorado. A91-92 ¶ 2-6.4

4
By the time of trial, one of CeramTec’s employees had moved to Colorado.
But post-complaint contacts with a forum are “irrelevant” to the personal-
jurisdiction analysis. Noonan v. Winston Co., 135 F.3d 85, 95 (1st Cir. 1998).
And in any event, a single employee in Colorado would not materially change the
analysis.

7
 CoorsTek, Inc. is a U.S.-based ceramics manufacturer. In 2005, CoorsTek

Inc. entered the medical implant market, incorporating C5 Medical Werks, LLC,

which is now CoorsTek Medical, LLC (collectively, C5). A308-309; see A1545-

47. C5 Medical Werks was located in Colorado, A155 ¶ 2; CoorsTek Medical is

now headquartered in Texas.5 C5 manufactures ceramic hip joint components and

sells those components to third-party manufacturers. A1523.

Ceramic Hip Joint Components. Artificial hip joints replicate the ball-

and-socket configuration of the human hip. A1637-40. Some components of

artificial hip joints, including the femoral head and acetabulum, may be made of

ceramics. Id. Ceramics have advantages over other materials, such as metals, and

work well in hip joints. See A1756.

Ceramics are made from a combination of different materials. A1572. A

common material used in medical implants is zirconia-toughened alumina (ZTA).

A1554-55. ZTA ceramics may also include other materials, such as chromium or

strontium. A1555. Like any material, the composition of a ZTA ceramic affects

its color. A1710-11. ZTA ceramics that contain chromium, for example, may be

almost white, pink, red, or purple, among other colors. A1590, A1631, A1704.

ZTA ceramics that include other materials—such as cobalt—may be blue. A1636,

A1711.

5
See CoorsTek Medical, Contact Information, http://www.coorstekmedical.com/
ContactUs.aspx.

8
 CeramTec’s and C5’s Products. For years, CeramTec has manufactured

ceramic hip joint components. CeramTec’s BIOLOX Delta product is a ZTA

ceramic that contains a combination of ingredients including 0.33% chromium,

giving it a pink color. A1555, A1722. CeramTec’s products have an unmatched

track record for safety, and surgeons associate the pink color of BIOLOX Delta

with the extremely low failure rate of CeramTec’s products. See A1643-44. To

protect the investment in its brand, CeramTec sought to register the color pink for

hip joint components in the United States, and also sought similar trademark

protection in Europe. See A619-881, A882-1139, A1340-41, A1529.

When C5 entered the market for ceramic hip joint components, it initially

decided to produce a white product containing no chromium called cerasurf-white

(or cerasurf-w). A1582-85. After researching the market and talking to potential

customers, however, C5 determined that it could better compete with CeramTec if

C5 had a pink product like CeramTec’s. See A1585, A1674-76. C5’s director of

sales and marketing accordingly visited Home Depot’s paint department, matched

the color of BIOLOX Delta to the paint color Cupid’s Arrow, and instructed C5’s

research team to work backwards to replicate the precise color. A1678. C5 now

has a pink ceramic containing about 0.33% chromium called cerasurf-pink (or

cerasurf-p). A1532, A1549, A1565-66.

9
 Chromium and Hardness. Different materials affect the properties of ZTA

ceramics in different ways. Zirconia, for example, is a relatively soft material,

while alumina is harder. A1555. Chromium is harder still. A1555-56.

Manufacturers blend together materials to achieve a ceramic with a mix of

desirable characteristics. See A1572-76, A1694.

Much of the early scientific research suggested that adding chromium to

ZTA ceramics increased their hardness, see A1559-62, and CeramTec initially

assumed that research was accurate. At least one early article, however, found no

hardness increase at low chromium concentrations. See A1742-46 (describing

1967 peer-reviewed article).

In 1998, while investigating the use of ceramics to cut iron and steel,

CeramTec obtained U.S. Patent 5,830,816 (the ’816 patent) on a ZTA ceramic

containing a combination of ingredients. The ’816 patent disclosed, among other

things, specific combinations of zirconium dioxide and various stabilizing oxides,

including chromium oxide. The patent described the use of chromium to improve

the properties of ceramic tools that cut steel. A1152. Claim three of the patent,

which is practiced by BIOLOX Delta, taught the combination of zirconia and

chromium in a wide range of ratios from 0.01% chromium (a ratio of 1:1,000) to

5% chromium (a ratio of 1:20) compared to zirconia. A1155. The patent

specification stated that this range of chromium makes it possible to “achieve

10
hardness values such as have not previously been achieved at such zirconium

dioxide contents.” A1152. The ’816 patent has now expired. A1534.

In 2002, CeramTec obtained another patent on ZTA ceramics (U.S. Patent

6,452,957) (the ’957 patent), which similarly stated that the addition of chromium

increased hardness in ceramics. A1342-1513. The ’957 patent, however, taught

that chromium was not always required to improve the properties of ceramics and

that additional hardness was not always beneficial for every application. A1346.

Instead, the patent recognized that a drop in hardness was not always a “disturbing

effect.” A1581.6

In the mid-2000s, CeramTec produced some ZTA ceramics without

chromium. Data from these experimental manufacturing runs suggested that

contrary to much of the prior research, chromium did not increase a ceramic’s

hardness values when it was in small concentrations. See A1707, A1714. But

given the variability and uncertainty inherent to experimental manufacturing runs,

there could have been other explanations too. As a result, CeramTec discussed that

data internally, but did not publish it. A1707. CeramTec continued to state that

chromium increases hardness in white papers and conversations with its customers

and the Food and Drug Administration (FDA). See A1731, A1750.

6
BIOLOX Delta does not practice the ’957 patent because BIOLOX Delta
contains strontium. A1579.

11
 In 2013, CeramTec obtained a third patent (U.S. Patent 8,932,970) (the ’970

patent) on ZTA ceramics and filed another patent application (U.S. Patent

Application 13/372,554) (the ’554 application). A1514-16, A1517-19. Both claim

a ceramic containing chromium, but neither states that chromium increases

hardness. See id.; A1740.7

When C5 entered the hip joint component market in 2005, it too evaluated

the effect of chromium on hardness. It found that chromium did not affect

hardness. A296-300, A301; A1582, A1602. C5 accordingly informed its

customers that there was no difference in hardness between its white product

(containing no chromium) and its pink product (containing 0.33% chromium).

A1336-39, A484, A488, A296-300; A1569, A1597, A1602, A1606-07, A1681-83.

C5 even prepared a presentation for an industry conference stating that chromium

has no effect on the properties of ceramics. A1683. In fact, C5 touted its white

ceramic as superior to its pink ceramic. See, e.g., A1685.

In 2014, after C5 filed suit in this case, it conducted additional research on

the effect of chromium on hardness. C5 reevaluated its historical data, and decided

that its pink ZTA ceramic was on average slightly “statistically” harder than its

white ZTA ceramic. A1597. C5 reached that conclusion by comparing production

lots from its early-stage 2010 white product to its later-stage 2014 pink product,
7
BIOLOX Delta does not practice the ’970 patent. A1766. The U.S. Patent and
Trademark Office (PTO) lists the ’554 application as abandoned.

12
without controlling or adjusting for the fact C5 had improved its manufacturing

processes over that four year period, including constructing an entirely new

production facility, even though changes in the manufacturing process can

influence hardness. A1614-15, 1617, 1634-35. C5 admitted that it could have

done the comparison using more recent white samples, but chose not to. A1612-

19. C5’s post-suit research was not peer-reviewed or published, A1610, and C5

acknowledged that it was not an “apples-to-apples comparison” or a “statistically

designed experiment.” A1634-35. Tellingly, despite having filed this case and

despite C5’s new analysis, C5’s director of sales and marketing continued to tell

customers as late as 2015 that C5’s white ceramic was superior to its pink ceramic.

A1685.

CeramTec also conducted a new study in 2014 comparing the hardness of

ceramics containing small amounts of chromium. A1717. Based on the results of

that study, CeramTec determined that very small amounts of chromium—including

the 0.33% contained in BIOLOX Delta—do not increase the hardness of ceramics.

A1721-24, A1727. Although C5’s experts questioned the methodology of

CeramTec’s study, they admitted C5’s own methodology was similar. A1647-49,

A1666-67. CeramTec’s study was published in a peer-reviewed journal in

February 2018. See Meinhard Kuntz et al., The effect of microstructure and

13
chromia content on the properties of zirconia toughened alumina, 44:2 Ceramics

International 2011 (forthcoming Feb. 2018).8

At trial, experts agreed that it is “not universally accepted” that chromium

increases hardness and that there is “a lot of science to be done” regarding

chromium’s impact. A1625-27. Experts also described conflicting scientific

articles, some of which conclude that chromium increases hardness and some of

which conclude that it does not. A1652-58.

While this appeal was pending, the District Court of Stuttgart issued a ruling

in a trademark dispute brought by CeramTec against another company, Metoxit

AG, that sought to manufacture ceramic hip components in the same shade of pink

as CeramTec’s products by using 0.33% chromium. The court obtained a report

from independent experts who tested samples of components from CeramTec and

Metoxit with a range of chromium levels; the experts found that chromium’s only

effect is on the color of the resulting ceramic, not on hardness or wear resistance,

and that a “wide range” of colors results from varying the chromium content. Add.

38-39. The court concluded that the only reason to use 0.33% chromium is to

8
Available at https://www.sciencedirect.com/science/article/pii/S027288421732
3507. To the extent the District Court discounted CeramTec’s study on the basis
that it had not yet been peer reviewed, A274, that criticism is now invalid.

14
obtain a ceramic in the particular shade of pink that matches CeramTec’s product.

Id. at 50-52, 56-57.9

Legal Proceedings. In 2013, CeramTec sent a cease and desist letter to C5,

stating that C5 was violating CeramTec’s trademark rights in the color pink, and

requesting that C5 stop selling pink hip joint components. A205 ¶ 76, A113-134.

CeramTec also filed suit against C5 in France and Germany and executed a seizure

of C5’s products at a conference in Paris. A205-206 ¶¶ 74-75, 80. C5 responded

by initiating proceedings challenging CeramTec’s trademark rights in Europe

before the Office for Harmonization in the Internal Market. See A206 ¶¶ 81-82.

C5 also initiated proceedings before the PTO seeking cancellation of CeramTec’s

trademarks.

In 2014, C5 filed the present suit in the District of Colorado, seeking

cancellation of CeramTec’s U.S. trademark registration and a declaration of non-

infringement. A208-212 ¶¶ 93-121. According to C5, CeramTec is not entitled to

trademark rights in the color pink because that color is caused by the addition of

chromium, and chromium serves a functional role in hip joint components. A202-

204 ¶¶ 62-69. As evidence of functionality, C5 alleged that CeramTec’s patents

teach that chromium increases hardness in ceramics. A192-193 ¶¶ 33-40.

9
For the convenience of the Court and consistent with Local Rule 32.1(B), a
certified English-translation of this ruling is included in the addendum.

15
 Personal Jurisdiction. CeramTec moved to dismiss for lack of personal

jurisdiction. CeramTec explained that it is a German corporation that sells its

products directly to third-party manufacturers, none of whom are in Colorado.

A91-92 ¶¶ 2-6. In addition to having no customers in Colorado, CeramTec also had

no employees or offices in Colorado. Id. CeramTec had only two connections to

Colorado—both of which were non-targeted and fortuitous: (1) CeramTec

attended three conferences hosted by national and international organizations of

orthopedic surgeons in Vail and Colorado Springs, and (2) CeramTec sent a cease-

and-desist letter to C5 at its Colorado address. C5 did not allege that CeramTec’s

conference activities were directed at Colorado or that C5’s injuries were caused

by CeramTec’s activities at those conferences. A84.10 And the cease-and-desist

letter expressly warned C5 of CeramTec’s trademark rights in Columbia, Mexico,

Canada, the United Arab Emirates, and Germany; it did not mention the specific

U.S. trade dress that gave rise to this litigation and did not threaten litigation in

Colorado (or anywhere else in the United States). A117 ¶ 2.3, A167.

The District Court nevertheless found specific jurisdiction over CeramTec

based on CeramTec’s attendance at the three industry conferences in Colorado. It

reasoned that CeramTec generally promoted its trade dress at industry conferences,
10
The three conferences were the 2012 Annual Meeting of the American
Osteopathic Academy of Orthopedics and the 2013 and 2014 Winter Hip and Knee
Courses sponsored by the Marshall University School of Medicine and the
International Congress for Joint Reconstruction. See A98-112.

16
and this case involves a dispute over CeramTec’s trade dress. A181. The District

Court did not reach whether CeramTec is subject to general jurisdiction in

Colorado. A180 n.1.

Trial. The District Court held a bench trial in the summer and fall of 2016.

The parties disputed whether chromium increases hardness in ceramics, whether

the ’816 patent claims the color pink, and whether the color pink is functional in

hip joint components. See, e.g., A1526-27 (C5 position that the color pink is a by-

product of an amount of chromium claimed in the patent and is therefore

functional); A1528 (CeramTec position that the color pink is not functional);

A1537 (CeramTec position that the patent does not claim the color pink); A1761-

62 (CeramTec position that 0.33% chromium in BIOLOX Delta is not functional).

C5 admitted that it had copied BIOLOX Delta’s pink color—not the

product’s overall composition. A1678. Trial testimony demonstrated that the ’816

patent claims a range of chromium, including an amount as low as 0.004%, which

results in a ceramic that is almost white. A1701, A1705, A1735; see also A1735

(describing range of chromium in ’970 patent). C5’s witnesses acknowledged that

ceramics made in accordance with the patent claims could be any number of

colors, including almost white, light pink, dark pink, red, or purple. A1590,

A1631; see also A1527. A CeramTec witness also testified that ceramics made in

17
accordance with the patent could be yellow, gray, or black, which C5 did not

dispute on cross-examination or otherwise. A1704.11

Findings of Fact and Conclusions of Law. In January 2017, the District

Court issued its findings of fact and conclusions of law. The court determined that

chromium increases hardness and is therefore a functional component of BIOLOX

Delta. A243. According to the District Court, CeramTec is not entitled to trade

dress rights in the color pink because the color results from the chromium used in

the product, and the color pink is therefore also functional. Id. The District Court

described its functionality ruling as a “legal conclusion” rather than “a scientific

one.” A248 n.5. The court also held that as a result of CeramTec’s prior

statements in its patents and elsewhere, CeramTec was estopped from claiming

that chromium is not functional in BIOLOX Delta. A254-255.

The District Court therefore granted C5’s request for a declaration of non-

infringement and directed the entry of judgment in C5’s favor on two counts of

C5’s complaint. A255-256.12

11
Evidence at trial also addressed whether CeramTec’s trade dress had acquired
secondary meaning, and whether C5’s pink products were likely to cause
confusion. See, e.g., A1670, A1754. Because the District Court’s ruling did not
address those issues, they remain unresolved and are not part of this appeal.
12
CeramTec had asserted counterclaims that are not at issue on appeal. C5 had
asserted a third cause of action that the District Court dismissed as moot; it also is
not at issue on appeal.

18
 CeramTec filed a post-judgment motion under Fed. R. Civ. P. 52(b)

requesting additional and amended findings. Among other things, it requested the

District Court find that the ’816 patent claims a range of chromium and that “the

chromium concentrations claimed in the ’816 patent result in a wide range of

colors from almost white to purple or red.” A263.13 The District Court amended

its findings of fact and conclusions of law to correct two technical errors, but

otherwise denied CeramTec’s motion. See A269-289.

This appeal follows.

SUMMARY OF ARGUMENT

1. The District Court lacked personal jurisdiction over CeramTec. Under

the Due Process Clause, a court can exercise specific jurisdiction only where a

defendant purposefully directs its activities at the forum State, the plaintiff’s

injuries arise out of those activities, and exercising personal jurisdiction is

consonant with traditional notions of fair place and substantial justice. Dudnikov v.

Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063, 1070-71 (10th Cir. 2008).

None of those requirements is met here.

13
CeramTec’s proposed findings of fact and conclusions of law included a similar
request. A221 ¶ 5 (“C5 admits a ceramic with chromium oxide can have a wide
variety of colors, including almost white, purple, and red[.]”); see also A220 ¶ 2
(“The BIOLOX Delta components are pink in color due to the presence of a
specific amount (.33%) of chromium oxide in the product.”).

19
 CeramTec is a German corporation that sells its products to third-party

manufacturers, none of which are located in Colorado. At the time of filing,

CeramTec had no employees or offices in Colorado, and it did no business there.

The District Court erred in holding CeramTec was subject to specific jurisdiction

in Colorado based on the company’s attendance at three conferences that national

and international orthopedic groups happened to hold in Colorado. According to

the District Court, CeramTec’s promotion of its products generally was a

justification for its trade dress application and the dispute involved CeramTec’s

trade dress. A275.

That was not enough. The three trade conferences that CeramTec attended

catered to a national and international audience. CeramTec’s presence at them did

not constitute a purposeful contact with Colorado itself; it was based on the

fortuitous selection, by the orthopedic groups, that Vail and Colorado Springs were

attractive conference locations for their national and international memberships. It

is unsurprising, then, that C5’s complaint did not allege that CeramTec

purposefully directed its trade-dress promotion at those conferences at Colorado, or

that C5’s injuries arose from CeramTec’s activities there.

Even if C5 had made such allegations, however, jurisdiction would still be

lacking: C5’s alleged injuries arose from CeramTec’s potential enforcement of its

trade-dress rights, not the promotion of its products at three conferences in 2012-

20
2014. If enforcement activities could be conflated with promotion activities,

virtually every company with a national or international presence would be subject

to trade dress litigation in any state. Worse still, C5’s suit sought to force

CeramTec to litigate in a foreign country, further weighing against the District

Court’s assertion of specific jurisdiction over the company.

Besides the conferences the District Court relied on, the motion-to-dismiss

briefing discussed other—even weaker—potential bases for subjecting CeramTec

to specific jurisdiction. Although CeramTec mailed a cease-and-desist letter to C5

in Colorado, other circuits have consistently repeatedly held that intellectual-

property owners can send cease-and-desist letters without subjecting themselves to

suit in foreign jurisdictions. See, e.g., Red Wing Shoe Co. v. Hockerson-

Halberstadt, Inc., 148 F.3d 1355, 1360-61 (Fed. Cir. 1998); Yahoo! Inc. v. La

Ligue Contre Le Racisme Et L’Antisemitisme, 433 F.3d 1199, 1208 (9th Cir. 2006)

(en banc). And although Colorado doctors may have used medical devices

containing CeramTec components in clinical trials or otherwise, there is no

allegation that CeramTec was aware that products containing its components were

being used by those doctors. C5’s injuries, moreover, did not arise from any

doctor’s use of a device containing a CeramTec component in Colorado.

CeramTec’s passive website similarly does not establish that the company is

subject to specific jurisdiction on C5’s claims in Colorado.

21
 This Court should accordingly reverse the District Court’s finding of

specific jurisdiction, and remand the case with instructions to dismiss. Further

proceedings on general jurisdiction are unwarranted in light of CeramTec’s limited

and sporadic contacts with Colorado. See BNSF Ry. Co. v. Tyrrell, 137 S. Ct.

1549, 1558 (2017) (a court cannot exercise general jurisdiction unless “a corporate

defendant’s operations in another forum” are “so substantial and of such a nature

as to render the corporation at home in that State”) (internal quotation marks

omitted).

2. The District Court declared that CeramTec has no trade dress rights in the

color pink because chromium is functional in BIOLOX Delta and the product’s

pink color results from the chromium it contains. That conclusion was error.

The District Court based its ruling in large part on the Supreme Court’s

decision in TrafFix, which holds that a utility patent is strong evidence that the

claimed features are functional. See 532 U.S. at 29-30. TrafFix, however, is

inapplicable here. CeramTec’s ’816 patent does not claim, or even mention, pink

or any other color. Instead, it claims a ceramic composition containing a range of

chromium that may result in ceramics of many different colors. CeramTec’s trade

dress claims only one of those colors: pink.

The central advance of the ’816 patent, moreover, was not the same as the

essential feature of CeramTec’s trade dress. The former is that a ZTA ceramic

22
with a specific range of chromium improves tools for cutting steel, and the latter is

pink hip joint components. This mismatch—between the central advance and

features claimed in CeramTec’s patent and the features asserted in CeramTec’s

trade dress—means the patent is not “strong evidence” that the color pink is

functional in BIOLOX Delta. The District Court erred in applying TrafFix to the

facts of this case.

The District Court committed a second legal error when it failed to evaluate

whether the amount of chromium that makes BIOLOX Delta pink is functional

over other small amounts of chromium that make ceramics other colors. In other

words, is using 0.33% chromium to make a product pink essential to the use or

purpose, or does it affect the quality, of the product as compared to using another

small amount that would result in a different color? The District Court concluded

only that the trial evidence showed chromium to be functional. But that level of

generality is not sufficient to decide functionality in this case: CeramTec’s trade

dress claims the color pink, not the element chromium. Here, where different

amounts of chromium within the range claimed in the patent result in ceramics of

different colors—all with a functionality no different than any other color ceramic

under the claims of the patent—the color pink is not functional. See Qualitex, 514

U.S. at 166. The District Court’s judgment should be reversed on that basis as

well.

23
 3. The District Court’s final holding—that Ceram Tec is estopped from

arguing that chromium is non-functional as a result of its patents and prior

statements—is also wrong. TrafFix specifically rejected the position that an

expired utility patent forecloses trade dress protection in the product’s design. The

Supreme Court instead held that a patent is strong—but rebuttable—evidence that

the features claimed in the patent are functional. The District Court’s estoppel

ruling would preclude a patent holder from ever obtaining trade dress protection on

features claimed in a patent. That is directly contrary to TrafFix. This Court

should reverse the District Court’s clear violation of Supreme Court precedent.

To the extent the District Court based its estoppel ruling on CeramTec’s

statements outside of the patent context, the District Court cites no authority for its

conclusion. Estoppel, moreover, is an equitable remedy that has no application

when, as in this case, it would estop CeramTec from arguing that chromium is non-

functional even though C5 took the exact same position for many years. Reversal

is warranted on this basis as well.

STANDARD OF REVIEW

This Court reviews a personal-jurisdiction ruling de novo. Bell Helicopter

Textron, Inc. v. Heliqwest Int’l, Ltd., 385 F.3d 1291, 1296 (10th Cir. 2004). In an

appeal from a bench trial, this Court reviews the District Court’s factual findings

for clear error and its legal conclusions de novo. Keys Youth Servs., Inc. v. City of

24
Olathe, 248 F.3d 1267, 1274 (10th Cir. 2001). It also “review[s] the application of

the facts to the law under a de novo standard.” Creative Consumer Concepts, Inc.

v. Kreisler, 563 F.3d 1070, 1075 (10th Cir. 2009).

ARGUMENT

I. THE DISTRICT COURT LACKED PERSONAL JURISDICTION

OVER CERAMTEC.

Federal courts may generally exercise personal jurisdiction to the same

extent as a state court of general jurisdiction in the State in which they are located.

See Fed. R. Civ. P. 4(k)(1)(A). Colorado’s long-arm statute permits the exercise of

personal jurisdiction to the full extent authorized by the Constitution. Dudnikov,

514 F.3d at 1070. The Due Process Clause of the Fourteenth Amendment in turn

limits personal jurisdiction to those cases where a defendant has “certain minimum

contacts” with the forum State “such that the maintenance of the suit does not

offend traditional notions of fair play and substantial justice.” Goodyear Dunlop

Tires Operations, SA v. Brown, 564 U.S. 915, 923 (2011) (internal quotation marks

omitted).

To determine whether those minimum contacts are present, this Court looks

to the “plausible, non-conclusory, and non-speculative” facts pled in C5’s

complaint, rather than to “conjecture or supposition.” Dudnikov, 514 F.3d at 1070,

1076. Specific jurisdiction is proper only if CeramTec (1) purposefully directed its

activities at Colorado, (2) C5’s injuries arose out of those activities, and (3)

25
exercising personal jurisdiction is consonant with traditional notions of fair play

and substantial justice. Id. at 1071.

Here, the District Court found that it could exercise jurisdiction over

CeramTec in this dispute with C5 because CeramTec had attended three

orthopedic conferences that happened to be held in Colorado. The District Court

never examined—and C5 never alleged—whether CeramTec’s activities at those

conferences were directed at Colorado as opposed to the national and international

membership of the orthopedic organizations hosting the conferences. C5 also

never alleged that C5’s injuries arose out of any promotion that CeramTec may

have done at the Colorado conferences. Nor could it have, because C5’s complaint

was premised on CeramTec engaging in enforcement activity, not promotion. And

traditional notions of fair play and substantial justice counsel against finding

specific jurisdiction over a foreign defendant based solely on its attendance at three

national and international conferences that happened to take place in Colorado.

C5’s other alleged bases for specific jurisdiction are even more tenuous, and

it is clear from the facts that there is no general jurisdiction over CeramTec in

Colorado. This Court should accordingly reverse the judgment of the District

Court and remand with instructions to dismiss.

26
 A. CeramTec’s Attendance At Three National And International
Conferences Hosted In Colorado Is Insufficient To Establish
Specific Jurisdiction.

The District Court held that CeramTec was subject to specific jurisdiction in

Colorado on C5’s complaint by reasoning that CeramTec had promoted its

products at three conferences in Colorado, that CeramTec had referenced

promotion in its trademark application, and that CeramTec would be defending

against C5’s request for cancellation of the trademark and a declaration of non-

infringement A275. The District Court’s analysis was wrong three times over.

First, although C5’s complaint states that CeramTec attended three

conferences in Colorado, see A187 ¶ 14, that fact alone is insufficient to show a

jurisdictionally relevant connection between CeramTec and Colorado. See Walden

v. Fiore, 134 S. Ct. 1115, 1121 (2014) (“The inquiry . . . ‘focuses on the

relationship among the defendant, the forum, and the litigation.’ ” (citation

omitted)). CeramTec did not choose the location of the conferences, which were

national and international in scope. See A98-112; see also A92-93 ¶¶ 10, 13

(conferences directed at a national and international audience). Rather than

demonstrating purposeful availment of Colorado, the location of these

confereences is at most a “ ‘random, fortuitous, or attenuated contact[ ].’ ” Bell

Helicopter, 385 F.3d at 1296 (quoting Burger King v. Rudzewicz, 471 U.S. 462,

475 (1985)). “From the perspective of [CeramTec], it was purely fortuitous that

27
[the conferences] happened to have a [Colorado] address.” International Techs.

Consultants, Inc. v. Euroglas S.A., 107 F.3d 386, 395 (6th Cir. 1997). CeramTec

“presumably would have been pleased” to attend the conferences “wherever” they

were held. Id. CeramTec’s Colorado contacts “occurred solely because” the

conferences were held there, “not because [CeramTec] sought to further its

business and create ‘continuous and substantial’ consequences there.” Calphalon

Corp. v. Rowlette, 228 F.3d 718, 723 (6th Cir. 2000).

Second, C5’s complaint does not allege that its injuries arose out of or are

related to CeramTec’s attendance at these three conferences. In this Circuit,

specific jurisdiction’s relatedness prong “is not satisfied if the same injury would

have occurred regardless of [the defendant’s] forum contact.” Monge v. RG Petro-

Mach. (Grp.) Co., 701 F.3d 598, 618 (10th Cir. 2012). In both the complaint and

amended complaint, the only injury C5 alleged is that CeramTec “executed a

seizure of C5’s Cerasurf product” in France, disrupting “the marketing of C5’s

Cerasurf product.” A58 ¶¶ 69-70, A205 ¶¶ 74-75. Although C5 alleged that the

“disruption of the marketing” of its products “continues to date,” id., C5 did not

allege that CeramTec’s attendance at the Colorado conferences disrupted C5’s

marketing activities, or led to any other specific injury to C5. In other words, C5

did not allege that anything about its suit would have been different had CeramTec

not attended the three Colorado trade conferences.

28
 Nor could it. C5’s allegation is not that it is injured by CeramTec’s

marketing of pink hip joint components, but instead that it is injured by

CeramTec’s efforts to prevent C5 from marketing pink hip joint components. The

cause of C5’s alleged injury is therefore the possibility that CeramTec will take

legal action against it—not CeramTec’s attendance at three national and

international conferences in Colorado.

The District Court nevertheless found specific jurisdiction on the ground that

CeramTec’s general promotion of its products at conferences was “a justification

for its trademark application.” A181. C5 failed to allege, however, that CeramTec

sought trade-dress protection for the color pink on the basis of CeramTec’s

attendance at conferences in Colorado. Indeed, CeramTec’s trade-dress

application does not mention any activities by CeramTec in Colorado. A682-684,

A941-943. CeramTec’s Colorado promotion of its trade dress therefore cannot be

a but-for cause of its registered trade-dress protection.

Even if C5 had alleged that CeramTec promoted its trade dress at the

Colorado conferences, however, that would still not be enough for specific

jurisdiction. As the Federal Circuit has explained in the patent context, where a

plaintiff seeks a declaratory judgment that a patent is invalid, “the contacts material

to the specific jurisdiction analysis . . . are not just any activities related to the

patent-at-issue.” Autogenomics, Inc. v. Oxford Gene Tech. Ltd., 566 F.3d 1012,

29
1019-20 (Fed. Cir. 2009). Instead, “the relevant activities are those that the

defendant purposefully directs” at the forum that “relate in some material way to

the enforcement or the defense of the patent.” Id. (emphasis added and internal

quotation marks omitted).

The same is true in the trade-dress context: Because C5 sought a declaratory

judgment of non-infringement and cancellation of CeramTec’s trade dress, to

establish specific jurisdiction, C5 had to demonstrate that CeramTec conducted

trade-dress enforcement or defense in Colorado. CeramTec’s attendance at the

Colorado conferences is not related to the enforcement or defense of its trade dress.

C5 never alleged, for example, that CeramTec arranged for the seizure of C5’s

products at the Colorado conferences. Cf. Campbell Pet Co. v. Miale, 542 F.3d

879, 886 (Fed. Cir. 2008) (finding specific jurisdiction where defendant attempted

to have the plaintiff’s allegedly infringing products removed from a trade

convention in the forum).

Third, exercising specific jurisdiction over CeramTec under the facts here is

not consonant with “traditional notions of fair play and substantial justice.”

Dudnikov, 514 F.3d at 1071. The “primary concern in determining the

reasonableness of personal jurisdiction” is “the burden on the defendant of

litigating the case in a foreign forum.” OMI Holdings, Inc. v. Royal Ins. Co. of

Canada, 149 F.3d 1086, 1096 (10th Cir. 1998). As the Supreme Court has

30
stressed, “[w]hen the defendant is from another country, this concern is heightened

and great care and reserve should be exercised before personal jurisdiction is

exercised over the defendant.” Asahi Metal Indus. Co. v. Superior Court., 480

U.S. 102, 114 (1987).

According to the District Court, because modern air travel is convenient and

CeramTec hired local counsel, the burden of litigating in Colorado is “minimal.”

A183. Such a conclusion is incompatible with the “great care and reserve” that

Asahi directs should be exercised before finding personal jurisdiction over a

foreign defendant. As this Court has stated, a foreign defendant such as CeramTec

faces a significant burden litigating in Colorado where “it has no office or property

in Colorado, is not licensed to do business in Colorado, and has no employees in

Colorado.” Benton v. Cameco Corp., 375 F.3d 1070, 1079 (10th Cir. 2004); see

also OMI, 149 F.3d at 1096. The fact that CeramTec was forced to hire local

counsel to navigate the intricacies of the U.S. legal system should be a point

against jurisdiction—not for it. CeramTec’s witnesses and evidence were located

in Germany, further demonstrating the burden on CeramTec.

In addition to the burden on CeramTec, the fair-play-and-substantial-justice

inquiry considers the forum State’s interest in resolving the dispute, the plaintiff’s

interest in receiving convenient and effective relief, the interstate judicial system’s

interest in obtaining the most efficient resolution of controversies, and the shared

31
interest of the several States in furthering fundamental substantive social policies.

Asahi, 480 U.S. at 113. In the case of a foreign defendant, however, those factors

tilt in favor of jurisdiction only where “the interests of the plaintiff and the forum

in exercising jurisdiction” are “so strong as to justify even the serious burdens

placed on the alien defendant.” OMI, 149 F.3d at 1096 (internal quotation marks

omitted).

Here, C5 has alleged that it was injured by CeramTec’s seizure of its

products in Paris and general disruption of C5’s marketing efforts, and it seeks

relief under federal law. A205 ¶¶ 74-75, A215-217. Colorado does not have an

interest greater than any other State—much less a “strong” interest—in resolving

such a dispute. C5 is incorporated in Delaware, where CeramTec filed suit against

C5 seeking to resolve this matter after C5 filed its declaratory judgment action in

Colorado. And C5 initiated an action before the PTO to cancel CeramTec’s trade

dress, providing an adequate forum for relief.

The “reasonableness prong of the due process inquiry,” moreover, “evokes a

sliding scale: the weaker the plaintiff’s showing on [minimum contacts], the less a

defendant need show in terms of unreasonableness to defeat jurisdiction.” Benton,

375 F.3d at 1079 (internal quotation marks omitted). Because CeramTec’s

contacts with Colorado are particularly weak, the scale more than tips against

finding jurisdiction in this case.

32
 Much of C5’s complaint and briefing on personal jurisdiction focused on its

own connections with Colorado, as opposed to CeramTec’s contacts with the

forum State. As the Supreme Court has emphasized, however, if the “relevant

conduct occurred” outside Colorado, “the mere fact that [this] conduct affected

plaintiffs with connections to the forum State d[oes] not suffice to authorize

jurisdiction.” Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773, 1781-

82 (2017) (first alteration in original and internal quotation marks omitted). The

fact that C5 is located in Colorado is thus insufficient to support specific

jurisdiction. See Walden, 134 S. Ct. at 1122 (“Due process limits on the State’s

adjudicative authority principally protect the liberty of the nonresident defendant—

not the convenience of plaintiffs or third parties.”); see also id. (“[H]owever

significant the plaintiff’s contacts with the forum may be, those contacts cannot be

‘decisive in determining whether the defendant’s due process rights are

violated.’ ”) (citation omitted).

C5 had ample opportunity to make a prima facie showing of personal

jurisdiction. It filed a complaint, an amended complaint, and an affidavit. See

A39-74, A185-218, A155-162. But none of those filings allege the facts necessary

to support specific jurisdiction. Because the requirements of the Due Process

Clause have not been met, this Court should reverse the judgment and remand with

instructions to dismiss for lack of jurisdiction.

33
 B. There Is No Other Basis For Personal Jurisdiction Over
CeramTec In Colorado.

C5 asserted that the District Court had specific jurisdiction over CeramTec

on several additional grounds, including that CeramTec sent a cease-and-desist

letter to Colorado, that CeramTec’s products were used in clinical studies and

surgeries in Colorado, and that a portion of CeramTec’s website allows users to

search by State for representatives of CeramTec North America. A144. The

District Court did not find those contacts sufficient to support specific jurisdiction,

and they are not.

Although this Court has not reached the issue, the Federal Circuit and the

Ninth Circuit agree that sending a cease-and-desist letter into a forum state is

insufficient to create specific jurisdiction. See Dudnikov, 514 F.3d at 1082

(“assuming without deciding that it would be unreasonable to found jurisdiction

solely on a cease-and-desist letter”); New World Int’l, Inc. v. Ford Global Techs.,

859 F.3d 1032, 1036 (Fed. Cir. 2017) (sending cease-and-desist letter does not

create specific jurisdiction); Red Wing Shoe, 148 F.3d at 1360-61 (same); Yahoo!

Inc., 433 F.3d at 1208 (9th Cir. 2006) (en banc) (same); Fusion Entertainment v.

Josh Agle, Inc., No. 07-cv-1651, 2008 WL 140489, *5 (D. Colo. Jan. 11, 2008)

(same); see also Kehm Oil Co. v. Texaco, Inc., 537 F.3d 290, 301 (3d Cir. 2008)

(citing Red Wing Shoe approvingly).

34
 As the Federal Circuit has explained, “[p]rinciples of fair play and

substantial justice afford” an intellectual-property owner “sufficient latitude to

inform others of its . . . rights without subjecting itself to jurisdiction in a foreign

forum.” Red Wing Shoe, 148 F.3d at 1360-61. The Ninth Circuit has similarly

held that “[t]here are strong policy reasons to encourage cease and desist letters,”

which are “normally used to warn an alleged rights infringer that its conduct, if

continued, will be challenged in a legal proceeding, and to facilitate resolution of a

dispute without resort to litigation.” Yahoo!, 433 F.3d at 1208. The Ninth Circuit

has emphasized that “[i]f the price of sending a cease and desist letter is that the

sender thereby subjects itself to jurisdiction in the forum of the alleged rights

infringer, the rights holder will be strongly encouraged to file suit in its home

forum without attempting first to resolve the dispute informally by means of a

letter.” Id. Those justifications apply equally to this case.

Although specific jurisdiction may be present where a defendant conducts

enforcement or defense activities beyond sending a cease-and-desist letter to the

forum State, C5 did not allege that CeramTec conducted any such additional

activities in Colorado. If C5 relies on the cease-and-desist letter in its appeal brief,

the Court should accordingly join its sister circuits in holding that sending a cease-

and-desist letter into a forum State is insufficient to create specific jurisdiction.

35
 C5’s allegation that “CeramTec products are the subject of clinical studies in

Colorado” similarly did not state a sufficient basis for specific jurisdiction. A188

¶ 16. C5 did not (and could not) allege that CeramTec was aware of those clinical

studies. See A93 ¶¶ 14-16 (sworn declaration stating that CeramTec was unaware

of third-party clinical trials taking place in Colorado). And C5 failed to allege that

the use of CeramTec’s products in Colorado clinical studies caused its injuries.

See A39-74, A185-218.

C5’s allegations that two Colorado surgeons use BIOLOX Delta was equally

irrelevant to jurisdiction. C5 did not allege that CeramTec knew those surgeons

used its products, that CeramTec sent its products to Colorado for use by those

surgeons, or that C5’s injuries were caused by those surgeon’s use of BIOLOX

Delta. See A159 ¶ 19. And although C5 alleged that CeramTec supported the

research of one Colorado doctor, it did not allege that doctor’s research occurred in

Colorado, involved CeramTec’s pink ceramics, or caused C5’s injuries. See A159-

161 ¶¶ 17-26; see also A166, A168 n.5. In any event, a “relationship with a third

party” such as a Colorado doctor or researcher “is an insufficient basis for

jurisdiction.” Bristol-Myers Squibb, 137 S. Ct. at 1781 (internal quotation marks

and alteration omitted); see also Avocent Huntsville Corp. v. Aten Int’l Co., 552

F.3d 1324, 1336 (Fed. Cir. 2008) (sales of patented products in the forum cannot

36
sustain a declaratory-judgment suit because the sales do not “relate in some

material way to the enforcement or the defense of the patent”).

With respect to CeramTec’s website, C5 asserted that specific jurisdiction is

proper in Colorado because one section of the website permits users to search by

state for representatives of CeramTec North America Corporation. A158 ¶ 15.

But CeramTec North America Corporation is not a defendant in this case—nor

does it sell any of the products at issue—so any information regarding that

company cannot establish specific jurisdiction over CeramTec GmbH. See A168

n.5; see also Quarles v. Fuqua Indus., Inc., 504 F.2d 1358, 1363-64 (10th Cir.

1974) (under state long-arm statute, absent an alter-ego relationship, a subsidiary’s

forum contacts are not imputable to its parent company); Ranza v. Nike, Inc., 793

F.3d 1059, 1072-75 (9th Cir. 2015) (same under the Due Process Clause); Patin v.

Thoroughbred Power Boats Inc., 294 F.3d 640, 653 (5th Cir. 2002) (same).

C5 also failed to allege that its injuries arose out of this portion of

CeramTec’s website, much less that any precedent supports finding specific

jurisdiction based on a single drop-down menu listing the names of different

States. See A158 ¶ 15, A163-164; see also Shrader v. Biddinger, 633 F.3d 1235,

1241 (10th Cir. 2011) (“The maintenance of a web site does not in and of itself

subject the owner or operator to personal jurisdiction, even for actions relating to

the site, simply because it can be accessed by residents of the forum state.”).

37
 Finally, C5 argued below that specific jurisdiction over CeramTec exists

because “CeramTec executed a seizure of C5’s Cerasurf product in Paris, and has

subsequently contacted C5 representatives to determine whether C5 will be

exhibiting its Cerasurf products in the United States.” A148. CeramTec’s actions

in Paris, however, do not support specific jurisdiction in Colorado. And C5 has

not claimed that the alleged contact between CeramTec and C5 representatives

took place in Colorado, much less that C5’s injuries arose from that contact.

In short, CeramTec is a German company that does no business in Colorado,

and at the time of filing had no customers, employees, or offices in Colorado. It is

unsurprising that C5 could not allege sufficient contacts with Colorado to justify

specific jurisdiction in this case. To the extent C5 has been injured, its injuries

arose from CeramTec’s efforts to enforce its trade dress in Paris—not in Colorado.

The only enforcement activity CeramTec has undertaken in Colorado is the

mailing of a single cease-and-desist letter to the State. Under established Federal

Circuit and Ninth Circuit precedent, such a contact is insufficient to establish

personal jurisdiction. This Court should accordingly reverse the District Court’s

finding of specific jurisdiction and remand with instructions to dismiss.

38
 C. The District Court Lacked General Jurisdiction Over CeramTec.

In the proceedings below, C5 did not argue that the District Court had

general jurisdiction over CeramTec. A146 n.5, A180 n.1. Instead, C5 requested

“the right to seek discovery regarding general jurisdiction if the Court orders

further development of the factual record.” A153 n.11. If this Court holds that the

District Court lacked specific jurisdiction over CeramTec, no remand for discovery

on general jurisdiction is warranted.

The facts alleged in the complaint and the accompanying affidavits make

clear that there is no general jurisdiction over CeramTec in Colorado. See Daimler

AG v. Bauman, 134 S. Ct. 746, 762 n.20 (2014) (“[I]t is hard to see why much in

the way of discovery would be needed to determine where a corporation is at

home.”). Colorado is not CeramTec’s place of incorporation or principal place of

business. Goodyear, 564 U.S. at 924. CeramTec is incorporated and has its

principal place of business in Germany. Nor is this an “exceptional case,” in

which CeramTec could be subject to general jurisdiction in Colorado because its

affiliations with the State “are so continuous and systematic as to render”

CeramTec “essentially at home in the forum State.” Daimler, 134 S. Ct. at 760-

761 & n.19 (internal quotation marks omitted). At the time of the case was filed,

CeramTec had no customers, employees, offices, bank accounts, or phone numbers

in Colorado. A40 ¶ 5, A91-92 ¶¶ 2-6. Cf. BNSF, 137 S. Ct. at 1559 (no general

39
jurisdiction despite 2,000 employees in state because a “corporation that operates

in many places can scarcely be deemed at home in all of them”) (internal quotation

marks omitted). If this Court finds that the District Court lacked specific

jurisdiction over CeramTec, no further proceedings are necessary.

II. THE DISTRICT COURT ERRED IN ITS ANALYSIS OF THE

FUNCTIONALITY OF THE COLOR PINK.

The District Court found that “[f]rom the ‘816 patent alone, but also from

the abundance of additional evidence in this case that chromium increases

hardness,” chromium “is a functional component of BIOLOX Delta.” A275.

Because “the pink color” of BIOLOX Delta “is a natural byproduct of the

chromium used in that product,” the District Court concluded that CeramTec

cannot claim trade dress rights in pink hip joint components. Id. The District

Court’s analysis suffers from two crucial flaws.

First, the District Court erred in its application of TrafFix, which holds that a

“utility patent is strong evidence that the features therein claimed are functional.”

532 U.S. at 29 (emphasis added). Here, the relevant feature claimed in

CeramTec’s patent (a range of chromium in a combination of other ingredients) is

not the same as the feature claimed in CeramTec’s trade dress (the color pink).

The central advance of the ’816 patent, moreover, is the use of the claimed

composition to improve tools for cutting steel; the essential feature of CeramTec’s

trade dress is the use of the color pink in hip joint components implanted in the

40
human body. The TrafFix presumption accordingly does not apply, and the

District Court’s judgment should be reversed on that basis.

Second, the District Court failed to analyze the fundamental question in this

case: Is the fact that BIOLOX Delta is pink “the reason the device works”?

TrafFix, 532 U.S. at 34. Here, where the range of chromium claimed in the ’816

patent results in ceramics of different colors—all with a functionality no different

than any other color ceramic under the claims of the patent—the color pink is not

functional. See Qualitex, 514 U.S. at 166; see also A1760-62 (arguing that ’816

patent claims a wide range of chromium, and does not specify that any amount of

chromium in that range has any particular effect). C5, after all, had told its own

customers for years that its white chromium-free hip joint product was better than

its pink one. The District Court’s judgment should thus be reversed on this basis

as well. At a minimum, however, this Court should remand for the District Court

to consider the issue under the correct legal framework.

A. The TrafFix Presumption Does Not Apply To This Case.

The District Court applied TrafFix’s “strong evidence” presumption to this

case based on the fact that the ’816 patent claims a ZTA ceramic composition with

a range of chromium and BIOLOX Delta’s pink color results from an amount of

41
chromium within that range. A280.14 That conclusion was error. The TrafFix

“strong evidence” presumption does not apply to this case for a simple reason:

The feature claimed in the patent—a range of chromium—is not the same as the

feature claimed in CeramTec’s trade dress—the color pink.

1. CeramTec’s ’816 Patent Claims A Range Of Chromium, But Its

Trade Dress Claims Pink.

In TrafFix, the “central advance” of the patent was a “dual-spring design”

that kept a road sign upright in strong winds. 532 U.S. at 30. That same “dual-

spring design” was also “the essential feature of the trade dress” that the patent

holder sought to protect. Id. Because the patent and trade dress claimed the same

central feature “necessary to the operation of the device,” the Supreme Court

concluded that the patent was strong evidence that the dual-spring design was

functional. Id. at 29-30.

Here, however, CeramTec’s patent does not claim the color pink, and its

trade dress does not reference chromium. One can practice the patent’s claims

without it yielding a pink product. Thus, the TrafFix presumption—that a feature

claimed in a patent is strong evidence that the same feature in a trademark is

functional—is simply inapplicable. See McAirlaids, Inc. v. Kimberly-Clark Corp.,

756 F.3d 307, 312 (4th Cir. 2014) (TrafFix presumption does not apply where

14
The District Court applied the TrafFix presumption only to CeramTec’s ’816
patent. See A280.

42
patents “do not mention” the feature claimed in the trade dress). The District

Court’s new rule—that the TrafFix presumption applies as long as the trade dress

claims a “natural byproduct” of a feature claimed in a patent (A284)—takes

TrafFix a step too far and is unsupported by the Supreme Court’s decision.

2. CeramTec’s ’816 Patent Claims Compositions That Include A

Range Of Chromium, Resulting In Colors Other Than Pink.

Even under the District Court’s “natural byproduct” theory, however,

TrafFix still does not apply. The District Court described the central advance in

CeramTec’s patent as the discovery that introducing small amounts of chromium

increases the hardness of ZTA ceramics. See A270. While remaining a relatively

small amount, the actual amount of chromium within the claimed range may vary

significantly based on other materials included in the ceramic. For example, claim

three of the ’816 patent—which is practiced by the BIOLOX Delta—describes a

range of chromium based on the amount of zirconia in the ceramic, including an

amount of chromium from 0.1% of the amount of zirconia (a ratio of 1:1,000) to

5% of the amount of zirconia (a ratio of 1:20). A1155; see A1663.

At trial, the evidence demonstrated that the range of chromium has an

unmistakable impact on the resulting product: A ceramic containing between 0.1%

and 5% chromium (compared to zirconia) does not have to be pink. It may be

almost white, red, or purple—or even yellow or black. See, e.g., A1590, A1631,

A1704; see also A1537 (pointing out that the ’816 patent covers a wide range of

43
colors, and that the addition of chromium does not necessarily result in a pink

ceramic). CeramTec’s patent thus does not claim the color pink, and in fact does

not refer to coloring at all. It claims a range of chromium that can result in a

product that is almost any color. For this reason too, the TrafFix presumption does

not apply: Once again, the feature claimed in the patent—a range of chromium—

is not the same as the feature claimed in the trade dress—the color pink.

The Fourth Circuit reached precisely that conclusion in an analogous case.

In McAirlaids, the patent at issue claimed a process for fusing absorbent materials.

756 F.3d at 309. That process left embossing patterns on the resulting material,

and the patent holder registered trade dress rights in a specific “pixel” embossing

pattern. Id. The Fourth Circuit concluded that in such a case, the TrafFix

presumption does not apply because the patent does not “refer to a particular

embossing pattern,” and instead recognizes that different embossing patterns may

result from the process described in the patent. Id. at 312.

That is the case here: CeramTec’s patent refers to a range of chromium,

rather than the color pink. As with the range of embossing patterns in McAirlaids,

CeramTec’s patent permits a range of different colors for the resulting ceramic

products. The “feature” claimed in CeramTec’s patent is thus not the same as the

“feature” in its trade dress, and the TrafFix presumption does not apply. That

remains true—as in McAirlaids—even though the pink color of BIOLOX Delta

44
results from one combination of ingredients, including chromium, that is described

in CeramTec’s patent.

The District Court reflexively applied TrafFix, without stepping back and

considering that CeramTec’s patent does not claim any particular amount of

chromium, but instead claims a range of chromium that may result in ceramics of

many different colors. Only one of those colors—pink—is associated with

CeramTec’s product, and that association is the reason why C5 deliberately copied

the exact shade of that color. The District Court’s “legal conclusion” of

functionality failed to consider the “scien[ce]” of CeramTec’s patent. A280 n.5.

Where the features claimed in the patent are not the same as the features claimed in

the trade dress, the District Court had an obligation to consider the issue of

functionality without using the patent as a heavy thumb on the scale. The District

Court failed to do so.

3. The Central Advance of the ’816 Patent Related To Improving Tools

for Cutting Steel, Not Better Hip Joint Components.

The TrafFix presumption does not apply for a final reason: The “central

advance” of CeramTec’s ’816 patent is that the claimed ZTA ceramic composition,

which includes a range of chromium in combination with various other ingredients,

improved tools for cutting steel. That is not the “essential feature” in CeramTec’s

trade dress.

45
 As CeramTec’s patent explains, the invention addresses a specific problem:

Making a material with a “high strength level and in which good toughness is

combined with great hardness” that “will be suitable as a cutting tool, especially as

a cutting insert, and quite especially as a cutting insert for the machining of cast-

iron and steel materials.” A1152. The range of chromium claimed in the patent

“makes it possible for the first time” to address that problem by achieving

“hardness values such as have not previously been achieved” at certain zirconium

concentrations. Id.

The “central advance” of the ’816 patent, then, is the use of a unique

composition with a range of chromium to improve the properties of cutting tools

used to machine iron and steel. CeramTec’s trade dress, however, is the use of the

color pink in hip joint components implanted in the human body. See, e.g., A1698-

99 (explaining the differences between cutting tools and hip joint components). At

most, the ’816 patent is strong evidence that a particular range of chromium, when

combined with various other ingredients, improves cutting tools; it does not

provide the same evidence regarding hip joint components. This case is thus far

afield from TrafFix, where the “central advance” of the patent (a dual-spring

design used in road signs) was the essential feature of the trade dress (a dual-spring

design used in road signs).

46
 The District Court erred by applying TrafFix to CeramTec’s ’816 patent and

pink trade dress; its judgment should accordingly be reversed on that basis.

B. The Color Pink Is Not Functional For Hip Joint Components.

In addition to its erroneous application of TrafFix, the District Court failed

to address the core question in this case: Whether the color pink is functional in

hip joint components. It is not. A feature is functional if “it is essential to the use

or purpose of the device or when it affects the cost or quality of the device.”

TrafFix, 532 U.S. at 33. Put it another way, the feature must be “the reason the

device works.” Id. at 34. The color pink is none of these things for hip joint

components. Hip joint components are made of many materials, including metal

and various kinds of ceramics, and the color pink is not what makes hip implant

components work.

At most, the evidence at trial demonstrated that ZTA ceramics produced

with the range of chromium claimed in the ’816 patent may be a variety of colors.

See, e.g., A1590, A1631, A1704. Although one amount of chromium in the range

leads to a pink ceramic, the patent does not ascribe any different “hardening”

benefit to using 0.33% chromium or any other amount of chromium within that

range. The trial evidence also showed that the color pink serves as a source

identifier—because it is associated with BIOLOX Delta and not with chromium.

A1644, A1169. The most compelling evidence on this point was C5’s admission

47
that its head of sales sent its scientists on a mission focused solely on copying

BIOLOX Delta’s precise shade of pink. A1678. Given this evidence, this Court

should reverse the District Court’s conclusion that the color pink is itself

functional. At the very least, it should remand to the District Court with

instructions to consider that question under the correct legal framework.

According to the District Court, chromium is functional because it increases

hardness; BIOLOX Delta gets its pink color from the chromium in its composition

(0.33%); and therefore CeramTec has no trade dress rights in pink hip joint

components. A275. That analysis skips an essential step: whether the precise

amount of chromium that makes a ZTA ceramic pink is functional, or whether

another amount—resulting in a different color—would serve that purpose just as

well. See McAirlaids, 756 F.3d at 314 (the relevant question is whether a specific

embossing pattern affects the quality of the product, not whether any embossing

pattern is functional); see also A221-222 ¶¶ 5-7.15

As noted, the range of chromium claimed in the ’816 patent results in many

different colors of ZTA ceramics, including almost white, yellow, pink, red,

purple, gray, or black. See, e.g., A1631 (patent covers colors from almost white up

to purple or red); A1704 (“[W]ithin the patent, you can produce a ceramic which is

15
One reason the District Court may have skipped the essential step in the
analysis is that it was focused on functionality as a “legal” rather than a “scientific”
question. A247 n.5.

48
white. It can be yellow. It can be gray, or it can be black.”). As C5’s head of

research and development agreed at trial, “there wasn’t anything that prevented

[C5] from adding more chromium, for instance, to make [its products] purple.”

A1631.

The color pink, then, is not the reason CeramTec’s hip joint components

work. It is no more essential to the use or purpose than another amount of

chromium within the patented range that would make the ceramic another color.

The District Court offered an orange juice example, see A285, that proves this

point. If “oranges” came in a range of colors and thus “orange” juice came in a

range of colors—but had the same taste and nutritional benefits—the orange color

of one version of the juice would not be functional (nor would red, pink, or purple

versions). As long as other colors remained available, a manufacturer who

established that the orange color of its juice had secondary meaning could seek

trade dress protection for that color.16

The District Court nevertheless concluded that the color pink is functional

unless CeramTec could show that color bears “no relationship” to the underlying

function of the product. A283. That is not the correct legal test. Under the

Supreme Court’s decision in Qualitex, the question is whether the specific color

16
Although different design features often have different advantages or
disadvantages, the ’816 patent does not differentiate the “hardness” benefit of
using any chromium amount in the range described in that patent.

49
claimed in the trademark is functional, not whether color as a general matter serves

some function in the product.

In Qualitex, the petitioner had for years manufactured dry cleaning press

pads in “a special shade of green-gold.” 514 U.S. at 161. After a competitor

began selling press pads in exactly the same shade, Qualitex registered the color as

a trademark. Id. The Supreme Court upheld the trademark. Id. at 174. According

to the Supreme Court, even though “it is important to use some color on press pads

to avoid noticeable stains,” the specific shade of green-gold trademarked by

Qualitex was not functional—and thus eligible for a trademark—because “other

colors are equally usable.” Id. at 166 (internal quotation marks omitted).

Similarly, in Ideal Toy Corp. v. Plawner Toy Mfg. Corp., 685 F.2d 78 (3d

Cir. 1982), the plaintiff had trademark rights in the design of a Rubik’s Cube,

which contained “54 faces colored with six primary colors—red, blue, green,

yellow, orange, and white—on a black gridwork.” Id. at 79. Although the “district

court acknowledged that some distinctive marks are necessary to differentiate the

faces of the cube,” it found that “given the wide variety of possible marks, the

actual colors and patches used are non-functional” and “serve no purpose other

than identification.” Id. at 81 (internal quotation marks omitted). The Third

Circuit upheld that conclusion. Id.

50
 The same is true here. Even assuming that chromium is functional, and that

the addition of chromium within the range claimed by CeramTec’s patent will have

some effect on the color of a ceramic, those facts do not mean that pink is

functional for hip joint components. As in Qualitex and Ideal Toy, other colors can

serve the same function and are “equally usable.” The evidence at trial

demonstrated that a product containing the range of chromium claimed in the

patent—and thus with the alleged functional benefit of chromium described in the

patent—could be almost white, red, or purple, among other colors. The color pink

is thus not functional in hip joint components.

The District Court’s judgment should be reversed. At a minimum, however,

this Court should remand to the District Court to consider a question of

fundamental importance to the outcome: What makes the amount of chromium

that gives the BIOLOX Delta its pink color functional when other amounts of

chromium in the claimed range of the ’816 patent result in different colors? Under

Qualitex, the answer that question is crucial to determining whether the color pink

is functional.

III. THE DISTRICT COURT’S ESTOPPEL RULING IS CONTRARY TO

TRAFFIX AND UNSUPPORTED BY LEGAL AND EQUITABLE
PRINCIPLES.

The District Court held that even if the chromium in BIOLOX Delta does

not increase hardness, CeramTec “is estopped from denying that chromium is

51
functional based on the contrary language of the various patents” and its

representations to the PTO, the FDA, and others. A286-287. This Court should

reverse that conclusion.

As a threshold matter, even if CeramTec is estopped from arguing that

chromium is not functional, that is insufficient to resolve this case. The

fundamental question at bar is not whether chromium is functional, but whether the

color pink is functional. The evidence at trial demonstrated that ceramics made in

accordance with the claims of CeramTec’s patent—and thus with the functional

benefits of those claims—may be any number of colors. Whether the amount of

chromium required to turn a ceramic pink is functional is thus a different question

from whether chromium as a general matter plays a functional role in ceramics.

In any event, the District Court’s estoppel ruling is contrary to TrafFix and

should be reversed. In TrafFix, the Supreme Court addressed whether “the

existence of an expired utility patent forecloses the possibility of the patentee’s

claiming trade dress protection in the product’s design.” 532 U.S. at 28. Several

circuits—including the Tenth Circuit—had answered that question in the

affirmative. See id. (citing Vornado Air Circulation Sys., Inc. v. Duracraft Corp.,

58 F.3d 1498, 1500 (10th Cir. 1995)). The Supreme Court reached the opposite

conclusion, holding that a utility patent is merely “strong evidence that the features

therein claimed are functional.” Id. at 29 (emphasis added). In other words, a

52
patentee with sufficient evidence may overcome “the statutory presumption that

features” in a patent “are deemed functional until proven otherwise by the party

seeking trade dress protection.” See id. 29-30.

According to the District Court, however, “even if science conclusively

proved that the chromium in BIOLOX Delta” is non-functional, CeramTec is

estopped from obtaining a trademark on the color pink. A286-287. In the District

Court’s view, no amount of evidence would suffice to overcome the presumption

that features in a patent are deemed functional unless proved otherwise by a party

seeking trade dress protection. The District Court would thus turn a rebuttable

statutory presumption into an absolute legal rule. That is precisely the position

rejected by TrafFix.

The District Court cited Disc Golf Association, Inc. v. Champion Discs, Inc.,

158 F.3d 1002, 1008 (9th Cir. 1998), for the proposition that a “kind of estoppel

arises” when a patent holder later seeks trade dress protection on features claimed

in the patent. A287. Disc Golf, however, was decided before the Supreme Court’s

opinion in TrafFix and is no longer persuasive authority on that point.

The District Court also cited Eco Manufacturing LLC v. Honeywell

International, Inc., 295 F. Supp. 2d 854, 872 (S.D. Ind. 2003), which relied on

Disc Golf to find estoppel “based on the assertions of utility” that a patent holder

made to obtain a patent. Id. at 872-873. Eco Manufacturing, however, failed to

53
address the Supreme Court’s decision in TrafFix. And when the Seventh Circuit

affirmed the lower court in Eco Manufacturing, it made no mention of estoppel—

which could suggest that the Seventh Circuit did not find the lower court’s analysis

of that issue persuasive. See 357 F.3d 649 (7th Cir. 2003).

As for the District Court’s conclusion that CeramTec is estopped from

asserting that chromium is non-functional based on its “representations to the

FDA, its representations to its customers and potential customers, and its

representations in scientific papers,” A287, it is unclear whether that is an

independent basis for estoppel, or merely additional facts that the District Court

considered when applying estoppel on the basis of CeramTec’s patents.

If those statements are an independent basis for estoppel, the District Court

does not cite any authority for that conclusion, or explain the legal theory

underlying it. See A1522 (plaintiff is unaware of any case finding estoppel under

similar circumstances). And such a conclusion would be peculiar: As C5’s

complaint admits, the science of ceramics has changed over time. In the 1970s,

researchers realized that metal hip joint components led to bone loss, and

manufacturers switched to ceramics. A190 ¶ 24. In the 1980s, manufacturers

added zirconia to ceramics, only to realize later that it led to fracturing. A190-191

¶ 26. Researchers then began experimenting with other combinations of materials,

including chromium, through a trial and error process. A191 ¶¶ 27-30. As the

54
science of ceramics continues to evolve, CeramTec should not be estopped from

supporting new research, even if that research is inconsistent with its earlier

conclusions.17

Applying estoppel in this case, moreover, would be inconsistent with both

legal and equitable principles. Under Colorado law, for equitable estoppel to

apply, “[t]he party to be estopped must know the facts and either intend the

conduct to be acted on or so act that the party asserting estoppel must be ignorant

of the true facts, and the party asserting estoppel must rely on the other party’s

conduct with resultant injury.” SDJ Ins. Agency, LLC v. American Nat’l Ins. Co.,

292 F.3d 689, 693 (10th Cir. 2002) (internal quotation marks omitted). Judicial

estoppel similarly applies only when “the party seeking to assert an inconsistent

position” in two different judicial proceedings “would derive an unfair advantage

or impose an unfair detriment on the opposing party.” Johnson v. Lindon City

Corp., 405 F.3d 1065, 1069 (10th Cir. 2005) (internal quotation marks omitted).18

The District Court did not analyze whether the requirements of either kind of

estoppel were met here, and they are not.

17
C5’s own expert agreed that “[i]t’s not universally accepted” that chromium
hardens ZTA ceramics, and that it might harden some ZTA ceramics and not
others, as well as have no material effect on performance. A1625-26.
18
Neither C5 nor the District Court cited any Tenth Circuit precedent concluding
that judicial estoppel applies to statements made in agency proceedings, and C5
does not allege that CeramTec has taken a position regarding the functionality of
chromium in prior judicial proceedings.

55
 C5 plainly did not rely on CeramTec’s initial view that chromium increases

hardness, or suffer any detriment as a result of that view. C5’s own position was

that chromium did not increase hardness, and “for many years, C5 told customers

that their Cerasurf white and Cerasurf-p were similar.” A1597 (testimony of John

Haftel, Director of Engineering for C5); see also A1552 (C5 e-mail to customer

stating that “C5 currently sells Cerasurf pink, which is weaker than Cerasurf

white”); A1582 (C5 technical files showing that white and pink ceramics are

substantially equivalent); A1599-1602 (brochure advertising C5’s white and pink

ceramics as having the same properties).

It was not until at least December 2014—after CeramTec released a study

stating that chromium did not increase hardness, and after C5 filed suit in this

case—that C5 took the position that chromium increases hardness. A1597; see

A39-74 (C5 complaint filed March 3, 2014); A1140-43 (CeramTec white paper

concluding that chromium is not functional published on October 22, 2014). In

2015, moreover, C5’s director of sales and marketing was still telling customers

that “white is better” than pink. A1685.

As the District Court recognized at trial, just as CeramTec’s position has

shifted, C5 has “done the same thing in reverse.” A1539; see also A1687 (“How

does C5 or CoorsTek Medical justify taking” the position at a trade show that

chromium has no effect on the properties of hip joint components “when it takes

56
the position in this lawsuit that chromia does contribute to hardness?”). Because

C5 has not demonstrated reliance on CeramTec’s position that chromium increases

hardness—or any unfair detriment to C5, given C5’s own position on this issue—

estoppel is inappropriate.

Even if C5 had shown reliance or detriment, however, estoppel would still

be unwarranted. Estoppel is a matter of equity, and it would be inequitable to

estop CeramTec from changing its position on chromium when C5’s change in

position on chromium is a mirror image. The District Court stated at trial that this

case is “revealing all kinds of dirty laundry on both sides”—hardly the sort of facts

that permit equitable relief. A1683-84 (discussing C5’s inconsistent position on

the functionality of chromium).

In short, the District Court’s conclusion that CeramTec is estopped from

claiming that chromium is not functional is contrary to TrafFix—and otherwise

unsupported by legal and equitable principles—and should be reversed.

57
 CONCLUSION

For the foregoing reasons, this Court should reverse the judgment of the

District Court and remand for further proceedings.

Respectfully submitted,

/s/ Jessica L. Ellsworth

February 9, 2018 JESSICA L. ELLSWORTH
ANNA KURIAN SHAW
SEAN MAROTTA
KATHERINE B. WELLINGTON
HOGAN LOVELLS US LLP
555 Thirteenth Street, N.W.
Washington, D.C. 20004
(202) 637-5600
[email protected]

CLAY C. JAMES
HOGAN LOVELLS US LLP
1601 Wewatta St.
Suite 900
Denver, CO 80202
(303) 899-7300

Counsel for Appellant CeramTec GmbH

58
 STATEMENT REGARDING ORAL ARGUMENT
Pursuant to Tenth Circuit Rule 28.2(C)(4), Appellant respectfully requests

oral argument in this appeal. This case raises important issues involving the

exercise of specific jurisdiction in suits seeking the cancellation of trade dress and

a declaration of non-infringement, as well as the proper interpretation of the

Supreme Court’s decision in TrafFix Devices, Inc. v. Marketing Displays, Inc., 532

U.S. 23 (2001). The District Court’s ruling on estoppel, moreover, is unsupported

by law or equity. Oral argument would be helpful to the disposition of this appeal

as the panel considers how to resolve those issues.

 CERTIFICATE OF COMPLIANCE
This brief complies with the type-volume limitation of Federal Rule of

Appellate Procedure 32(a)(7)(B) because this brief contains 12,987 words,

excluding the parts of the brief exempted by Federal Rule of Appellate Procedure

32(a)(7)(B)(iii).

This brief complies with the typeface requirements of Fed. R. App. P.

32(a)(5) and the typestyle requirements of Federal Rule of Appellate Procedure

32(a)(6) because it has been prepared in a proportionally spaced typeface using

Microsoft Office Word in Times New Roman 14-point font.

/s/ Jessica L. Ellsworth

Jessica L. Ellsworth

Counsel for Appellant CeramTec GmbH

CERTIFICATE OF DIGITAL SUBMISSION AND PRIVACY REDACTION
I hereby certify that with respect to the foregoing:

(1) all required privacy redactions have been made pursuant to Tenth Circuit

Rule 25.5;

(2) if required to file additional hard copies, the ECF submission is an exact

copy of those documents; and

(3) the ECF submission has been scanned for viruses with the most recent

version of a commercial virus-scanning program, Symantec Endpoint Protection.

The current version is 14.0.2415.0200. The most recent update was on February 9,

2018. According to the program, the digital submissions are free of viruses.

/s/ Jessica L. Ellsworth

Jessica L. Ellsworth

Counsel for Appellant CeramTec GmbH

ADDENDUM
 TABLE OF CONTENTS

Page
Order Denying Defendant’s Motion to Dismiss (ECF 35) ............................... Add. 1

Amended Findings of Fact, Conclusions of Law, and Order of

Judgment (ECF 308) .................................................................................. Add. 11
Judgment, CeramTec GmbH v. Metoxit AG,
No. 17 O 1790/13 [Regional Court of Stuttgart] Feb. 1, 2018
(Ger.) – Certified English Translation ...................................................... Add. 32
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 1 of 10

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO
Judge R. Brooke Jackson

Civil Action No 14-cv-00643-RBJ

C5 MEDICAL WERKS, LLC,

Plaintiff,

v.

CERAMTEC GMBH,

Defendant.

ORDER DENYING DEFENDANT’S MOTION TO DISMISS

This matter is before the Court on Defendant’s Motion to Dismiss for Lack of

Jurisdiction Pursuant to FRCP 12(b)(2). ECF No. 15. The motion argues that this Court lacks

personal jurisdiction over the defendant. For the reasons explained below, the motion is denied.

I. Factual Background

The underlying dispute here is about whether the defendant holds a trademark in the color

pink in ceramic components for prostheses, and whether plaintiff’s products infringe on that

trademark. Plaintiff C5 Medical Werks, LLC (“C5”) is a Delaware company headquartered in

Grand Junction, Colorado. C5 produces ceramic components for medical prostheses. Those

components use a ceramic composite called “Cerasurf.” According to C5, Cerasurf appears pink

because it contains chromium oxide.

Defendant CeramTec GmbH (“CeramTec”) is a German company that also produces

ceramic prosthetic components. CeramTec’s composite, “Biolox Delta,” contains chromium

Add. 1
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 2 of 10

oxide and appears pink. While CeramTec appears to be one of the largest producers of these

ceramic components in the U.S. market, the company has no physical presence in Colorado. Its

website is, obviously, available worldwide, but it lacks any Colorado-specific content.

CeramTec also claims not to “solicit business in Colorado, send agents into Colorado to solicit

business, hold itself out as doing business in Colorado, or conduct its business in Colorado.”

ECF No. 15 at 3.

The dispute between the two companies boils down to the following. Defendant

CeramTec had, at one time, a patent on the use of chromium oxide in its ceramic medical

implants. Among other attributes, chromium oxide hardens the components. The use of

chromium oxide also allegedly imparts a pink hue to the components. After the expiration of

CeramTec’s patent, other companies, including plaintiff C5, began using chromium oxide. C5

claims that as a result, its ceramic medical components took on a pink hue. In the meantime,

CeramTec initiated an application with the U.S. Patent and Trademark Office (“USPTO”)

seeking to trademark the color pink in its medical devices. C5 views this application as an

improper attempt to continue to reap the benefits of a patent on chromium oxide. CeramTec’s

application explains that the company has been selling its pink product in interstate commerce

for more than a decade, and that it had “widely displayed and promoted” its products throughout

the United States. Hughes Decl., Ex. F ¶ 2. While the USPTO denied CeramTec’s application

for listing on the Principal Register, it permitted the company to list its trademark (the color

pink) on the Supplemental Register. Such listing gives rise, in part, to CeramTec’s attempts to

enforce its trademark against C5’s use of the color pink.

Add. 2
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 3 of 10

In late 2013, CeramTec sent a cease and desist letter to C5 in Colorado objecting to C5’s

continued production of pink ceramic implants. That letter expressed an intent to defend

CeramTec’s “worldwide” intellectual property rights. C5 also alleges that around the same time

CeramTec seized C5’s products from a tradeshow in Paris, France. Finally, C5 alleges that

CeramTec has participated in three national industry conferences here in Colorado where the

defendant promoted its pink products and publicized the fact that it was seeking a trademark on

the color and would enforce its trademark against competitors in Colorado. CeramTec disputes

this characterization of its actions. It argues that the conferences were not directed at Colorado

residents and were designed to be generally educational for industry members rather than a

specific opportunity to promote its products. ECF No. 15 at 3-4. CeramTec admits to

sponsoring the conferences but denies that it made any effort to enforce its trademark at those

events or in any other manner in Colorado besides sending the cease and desist letter.

On March 3, 2014, C5 initiated a lawsuit in this Court asserting three causes of action.

The first two seek cancellation of trademarks in the USPTO’s Supplemental Register. ECF No.

1 at 21-24. The third cause of action is for a declaratory judgment that C5’s own products,

although they appear pink and contain chromium oxide, do not infringe on the aforementioned

trademarks. Id. at 24-26.

On May 6, 2014, CeramTec moved to dismiss C5’s complaint on the grounds that this

Court lacks personal jurisdiction over CeramTec. A month later, CeramTec filed a complaint in

the District Court of Delaware alleging trademark infringement, unfair competition, and

deceptive trade practices against C5. The Court discussed these issues with the parties at a

scheduling conference on August 12, 2014. Counsel for CeramTec could not promise that it

Add. 3
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 4 of 10

would serve its complaint in the Delaware case if the instant case were dismissed for lack of

jurisdiction, although it did in fact serve the complaint shortly after the scheduling conference.

See ECF No. 32.

II. Analysis

A. Standard of Review

To establish personal jurisdiction over an out-of-state defendant, “a plaintiff must show

that jurisdiction is legitimate under the laws of the forum state and that the exercise of

jurisdiction does not offend the due process clause of the Fourteenth Amendment.” Employers

Mut. Cas. Co. v. Bartile Roofs, Inc., 618 F.3d 1153, 1159 (10th Cir. 2010). Colorado’s “long-

arm” statute, C.R.S. § 13-1-124, has been interpreted to confer the maximum jurisdiction

permitted by constitutional due process. Archangel Diamond Corp. v. Lukoil, 123 P.3d 1187,

1193 (Colo. 2005). Therefore, the Court need only determine whether exercise of jurisdiction

over the defendant comports with due process.

The Due Process Clause “operates to limit the power of a State to assert in personam

jurisdiction over a nonresident defendant.” Helicopteros Nacionales de Colombia, S.A. v. Hall,

466 U.S. 408, 413–14 (1984). In order to exercise jurisdiction, the out-of-state defendant must

have “minimum contacts” with the forum state such that the exercise of jurisdiction does not

“offend traditional notions of fair play and substantial justice.” Int’l Shoe Co. v. State of Wash.

Office of Unemployment Comp. and Placement, 326 US. 310, 323 (1945). In all, the defendant’s

contacts with the forum must be such that it is foreseeable that the defendant could “reasonably

anticipate being haled into court there.” World-Wide Volkswagen Corp. v. Woodson, 444 U.S.

286, 297 (1980).

Add. 4
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 5 of 10

Minimum contacts may be established in two ways. First, general jurisdiction exists

where the defendant has “continuous and systematic” contacts with the forum state such that

exercising personal jurisdiction is appropriate even if the cause of action does not arise out of

those contacts. See Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846, 2851

(2011). Second, specific jurisdiction exists where the cause of action is “related to” or “arises

out of” the defendant’s activities within the forum state. See Helicopteros Nacionales, 466 U.S.

at 414 (citation omitted). In such cases, jurisdiction is proper “where the contacts proximately

result from actions by the defendant himself that create a ‘substantial connection’ with the forum

State.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985) (emphasis in original)

(citations omitted). In general, specific jurisdiction may be had over a nonresident defendant

only where that defendant “purposefully directed” its actions at the forum state or “‘purposefully

availed’ itself of the privilege of conducting activities or consummating a transaction in the

forum state.” Dudnikov v. Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063, 1071 (10th Cir.

2008) (citations omitted). This inquiry “ensure[s] that an out-of state defendant is not bound to

appear to account for merely ‘random, fortuitous, or attenuated contacts’ with the forum state.”

Id. (quoting Burger King, 471 U.S. at 475).

The burden of proof is on the plaintiff to establish minimum contacts. OMI Holdings,

Inc. v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1091 (10th Cir. 1998). Where a challenge to

personal jurisdiction is raised early in the litigation, the plaintiff may meet its burden with a

prima facie showing based on the pleadings. Shrader v. Biddinger, 633 F.3d 1235, 1239 (10th

Cir. 2011). The Court accepts as true all well pleaded, non-conclusory facts alleged in the

plaintiff’s complaint, and all factual disputes are resolved in the plaintiff’s favor. Id.

Add. 5
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 6 of 10

B. Specific Jurisdiction in Trademark Actions Seeking Declaratory Relief

This motion turns on the question of whether this Court has specific personal jurisdiction

over CeramTec. 1 CeramTec’s position is that in this context—trademark disputes seeking

declaratory relief—its contacts with Colorado are insignificant and do not give rise to the injury

complained of by C5. CeramTec further argues that traditional notions of fair play and

substantial justice fail to support an exercise of jurisdiction in this case.

1. C5’s Injury Arises Out of CeramTec’s Purposeful Availment of Colorado.

CeramTec points to an earlier case in which a court in this district found that the sending

of a single cease and desist letter was insufficient to justify the exercise of specific personal

jurisdiction. In Fusion Entertainment v. Josh Agle, Inc., a defendant possessing a trademark sent

a cease and desist letter to the plaintiffs in Colorado. The plaintiffs filed an action for

declaratory relief in this Court, and the defendant moved to dismiss for lack of personal

jurisdiction. Ruling for the defendant, this Court wrote that

Plaintiffs also cannot establish personal jurisdiction by the simple fact that
Defendant has common law trademark or other intellectual property rights in this
state. Courts have held that owning intellectual property rights and sending cease
and desist letters into a state in connection with same are not sufficient to
establish a basis for personal jurisdiction. Some additional act of purposeful
availment is required of the holder of the intellectual property rights.

Fusion Entm't v. Josh Agle, Inc., No. 07CV1651-WYD-KLM, 2008 WL 140489, *5 (D. Colo.

Jan. 11, 2008). In that case, the court found that the plaintiffs failed to demonstrate that the

1
In its response to the motion to dismiss, C5 does not argue that the Court has general jurisdiction over CeramTec.
Rather C5 requests discovery on the topic of general jurisdiction if the Court deems it necessary to the resolution of
Ceramtec’s motion to dismiss. Because I find the facts alleged in the complaint and accompanying affidavits
sufficient to find personal jurisdiction in this case, such discovery is unnecessary. Furthermore, the motion and
associated briefing devoted several pages to the question of whether Fed. R. Civ. P. 4(k)(2) might serve as an
alternative basis for jurisdiction. In light of the fact that CeramTec filed and served its related complaint in the
Delaware District Court, it appears that Rule 4(k)(2) is not a viable source of personal jurisdiction in this case.

Add. 6
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 7 of 10

defendant “purposefully availed itself of doing business in Colorado in any manner.” Id. at *4. 2

CeramTec suggests that “[c]ourts draw a distinction between cease and desist letters that are sent

solely to the declaratory judgment plaintiff and communications to third parties that trigger some

action that adversely affects the plaintiff.” ECF No. 15 at 10 (citing Dudnikov, 514 F.3d at 1075-

76).

I agree with this characterization of the law. The fact remains, however, that in this case

CeramTec did more than simply send a cease and desist letter to Colorado. It also sent agents to

Colorado, repeatedly, to promote its products at national conferences. Its promotion of these

products is a justification for its trademark application. The specific legal dispute in this case

springs from C5’s desire for the cancellation of CeramTec’s existing trademark in the

Supplemental Register and a declaration that C5 is not infringing on CeramTec’s trademarks.

These disputes therefore arise out of the very activities that CeramTec has undertaken in

Colorado. The fact that CeramTec has actively sought to promote its brand and its unique pink

color—the precise subject of its disputed trademark—in Colorado on at least three occasions

establishes purposeful direction at the forum state.

CeramTec relies extensively on the Tenth Circuit’s holding in Dudnikov as establishing

that some more concrete form of trademark enforcement inside the forum state is a prerequisite

to personal jurisdiction. In Dudnikov, the defendants directed communications at third parties in

a non-forum state (California), knowing those third parties would take action causing injury in

the forum state (by cancelling the auction in Colorado). Dudnikov, 514 F.3d at 1070. However,
2
The Court reached this finding despite the fact that Josh Agle the individual—as opposed to the corporate entity
named as the defendant—appears to have sold artwork to Denver art galleries and to have personally traveled to
Colorado in connection with art sales. Because the complaint did not name Josh Agle the individual, and because
plaintiffs provided no evidence to prove that the individual and the corporate entity were alter egos, these Colorado
activities were not considered in the personal jurisdiction analysis.

Add. 7
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 8 of 10

I see the instant case as an even clearer example of in-forum activity. CeramTec’s

communications with third parties—communications that appear designed to create trademark

rights and to broadcast a willingness to enforce those rights—actually took place in the forum

state. 3

I also note that my decision from SpaceCo Business Solutions, Inc. v. Mass Engineered

Design, Inc., 942 F. Supp. 2d 1148 (D. Colo. 2013) does not foreclose my conclusions in this

order. In SpaceCo, the plaintiffs attempted to justify this Court’s personal jurisdiction over the

defendant on the grounds that the defendant had previously sued the plaintiff in a different state

knowing full well that the plaintiff would feel the effects of the suit in Colorado. Such a

justification took the “effects test” from Calder v. Jones, 465 U.S. 783 (1984) to an untenable

extreme. I held that such a rationale would mean that a lawsuit in any state would make the

plaintiff vulnerable to countersuit in the defendant’s home state regardless of the absence of any

contacts between the plaintiff and defendant’s home forum. Here, however, CeramTec has

purposefully directed trademark establishment and enforcement activities at Colorado, and

SpaceCo is inapplicable.

3
Obviously, in some respects the purposeful availment in Dudnikov is different and arguably more direct. That is,
the defendant in Dudnikov asked the third party in California to shut down the auctions in Colorado. Here, by
contrast, communications with third parties were allegedly efforts to promote the use and distinctiveness of the
trademark in the national economy. While these are certainly different types of availment, they both appear
purposefully directed at the forum and sufficient to establish personal jurisdiction in this Court.

Add. 8
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 9 of 10

2. Exercising Personal Jurisdiction Over CeramTec Satisfies the Fair Play and

Substantial Justice Test.

Finally, the Court finds that exercising personal jurisdiction over CeramTec in this matter

comports with “traditional notions of fair play and substantial justice.” Dudnikov, 514 F.3d at

1080. In reaching that conclusion, I consider

(1) the burden on the defendant, (2) the forum state’s interest in resolving the
dispute, (3) the plaintiff’s interest in receiving convenient and effective relief, (4)
the interstate judicial system’s interest in obtaining the most efficient resolution of
controversies, and (5) the shared interest of the several states in furthering
fundamental substantive social policies.

OMI Holdings, 149 F.3d at 1095.

In the instant case, the burden on CeramTec is minimal given the relatively convenient

nature of modern air travel between Germany and Denver. Litigating in Colorado is minimally

more burdensome, if at all, than litigating in Delaware, which CeramTec has chosen to do.

Moreover, CeramTec is represented by Denver-based counsel. Regarding the second factor,

Colorado has an interest in seeing that its companies operate appropriately under existing

intellectual property law, and that they comply with all applicable, valid trademarks. C5’s

interest in convenient and effective relief should be apparent given their location in Grand

Junction. To be sure, the company is incorporated in Delaware, but its existence there is a

documentary one—neither its officers nor any of its employees are located in Delaware. The

interstate judicial system’s interest in efficient resolution of controversies would appear to

support an exercise of jurisdiction here given that the case was first filed in Colorado and has

proceeded through a motion to dismiss and an initial scheduling conference. The fifth factor—

the shared interest of the states in furthering fundamental social policies—does not appear to

Add. 9
Case 1:14-cv-00643-RBJ Document 35 Filed 09/08/14 USDC Colorado Page 10 of 10

favor or disfavor an exercise of jurisdiction here. Nonetheless, an ample majority of the factors

indicates that it would be fair to require CeramTec to litigate this matter in the District of

Colorado.

III. Conclusion

Therefore Ceramtec’s motion to dismiss for lack of personal jurisdiction [ECF No. 15] is

DENIED.

DATED this 8th day of September, 2014.

BY THE COURT:

___________________________________
R. Brooke Jackson
United States District Judge

10

Add. 10
Case 1:14-cv-00643-RBJ-CBS Document 308 Filed 04/20/17 USDC Colorado Page 1 of 21

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO
Judge R. Brooke Jackson

Civil Action No 14-cv-00643-RBJ

C5 MEDICAL WERKS, LLC and

COORSTEK MEDICAL, LLC,

Plaintiffs and Counter-Defendants,

v.

CERAMTEC GMBH,

Defendant and Counter-Plaintiff.

AMENDED FINDINGS OF FACT, CONCLUSIONS OF LAW, AND ORDER OF

JUDGMENT

This case was tried to the Court from August 29, 2016 to September 8, 2016 and from

October 3, 2016 to October 5, 2016.

I. FINDINGS OF FACT

A. The Parties.

1. Defendant/counter-plaintiff CeramTec GmbH (“CeramTec”) is a company that

produces pink-colored ceramic hip implant components sold under the name BIOLOX Delta.

See Trial Tr. 619:1–10; DX-399. CeramTec sells these products to Original Equipment

Manufacturers (“OEMs”). DX-1095. OEMs incorporate BIOLOX Delta products into hip

implant systems that the OEMs in turn sell to hospitals for use by surgeons in orthopedic

surgeries. Id.; Tr. 1618:19–1619:3. CeramTec currently controls roughly 95% of the ceramic

hip implant market in the United States. Tr. 1617:21–25.

Add. 11
Case 1:14-cv-00643-RBJ-CBS Document 308 Filed 04/20/17 USDC Colorado Page 2 of 21

2. Plaintiff/counter-defendant C5 Medical Werks, LLC (“C5”), which later became

CoorsTek Medical, LLC (“CoorsTek”), was founded in 2005 to produce ceramic products,

including ceramic hip implant components, for sale in the orthopedic market.1 Tr.149:19–

151:25, 153:3–17, 213:9–15.

B. Timeline of Events.

3. On July 2, 1996 CeramTec applied for a utility patent on a ceramic cutting tool.

DX-423 at 1. This application asserted that CeramTec had solved a pre-existing problem with

certain ceramic composites known as zirconia-toughened alumina or “ZTA” ceramics whereby

the introduction of zirconium used to toughen the material caused a drop in the material’s

hardness. See Tr. 657:16–658:5; PX-190 (Applicant’s April 15, 1997 Response to Patent

Office). CeramTec claimed that through the introduction of chromium in a specific molar ratio

with other components of ZTA ceramics, namely zirconium dioxide, Tr. 657:19–25; see also PX

190 at 216, it could achieve hardness scores for ZTA ceramics that had never been achieved with

corresponding zirconium dioxide contents, Tr: 657:19–658:8; PX-190 at 216. Hardness is an

important characteristic of ceramic materials because it affects the ceramic’s wear properties,

which influence performance.2 Tr. 219:12–16, 643:25–644:13.

4. Although an existing patent already taught the use of chromium in ZTA ceramics,

see Tr. 656:20–657:7 (describing the “Ekstrom” patent), the Patent Office issued CeramTec a

patent on November 3, 1998 (the ‘816 patent). DX-423 (the ‘816 patent). CeramTec overcame

a contrary office action based in part on the company’s insistence that it had discovered that a

1
For ease of use, the Court will collectively refer to plaintiffs C5 and CoorsTek simply as “C5” or
“plaintiffs” throughout this Order.
2
In addition to increasing the hardness of ceramic materials, chromium is touted for its numerous other
useful benefits, including increasing toughness and phase stabilization. See, e.g., Tr. 691:11–17.

Add. 12
Case 1:14-cv-00643-RBJ-CBS Document 308 Filed 04/20/17 USDC Colorado Page 3 of 21

small and specific ratio of chromium improved ZTA ceramic hardness values dramatically. Tr.

656:20–659:10; DX-423; PX-190.

5. Around the same time that it obtained the ‘816 patent, CeramTec developed

BIOLOX Delta. See DDX-1017; Tr. 1016:20–1017:15; 1018:20–23. In producing BIOLOX

Delta, which is a ZTA ceramic product, CeramTec practices at least claim 3 of the ‘816 patent.

ECF No. 247 at 2, ¶4 (joint pretrial stipulations). The chromium added to BIOLOX Delta gives

it a light pink color. DX-228; DX-281.

6. In the early 2000s, CeramTec began to market BIOLOX products commercially.

DDX-1017.

7. In September of 2002 CeramTec obtained another patent for ZTA ceramics (the

‘957 patent). PX-142. Like the ‘816 patent, the ‘957 patent claimed the use of chromium in

ZTA ceramics. PX-142 (the ‘957 patent), claims 1-4 and at 4:37–56, 5:12–51, 7:14–27.

Echoing the ‘816 patent, the ‘957 patent also explained that the introduction of chromium in a

specific ratio with zirconium counteracted a drop in hardness. PX-142 at 5:41–44 (“[T]he

chromium addition counteracts any drop in the hardness values when the proportion of

zirconium dioxide rises.”). CeramTec does not specifically practice the ‘957 patent in producing

BIOLOX Delta products. Tr. 394:4–10. This patent is still in force today.

8. CeramTec owns an additional patent on ZTA ceramics (the ‘970 patent) and a

pending patent application (U.S. Patent Publ. No. 2012/0142237 or the ‘554 Appl.) that similarly

teach the use of chromium to improve the properties of ceramic materials. PX-550 (the ‘970

patent), claims 1 and 20; PX-551 (the ‘554 Appl.), claim 8; Tr. 1136:16–24.

9. In April of 2004 CeramTec made two submissions to the Food & Drug

Administration (“FDA”) in which the company represented that the addition of chromium in its

Add. 13
Case 1:14-cv-00643-RBJ-CBS Document 308 Filed 04/20/17 USDC Colorado Page 4 of 21

composite material counteracts a drop in hardness caused by an increasing amount of zirconia.

See PX-79 at 6; PX-86 at 6.

10. In 2006 CeramTec produced research that suggested that chromium did not

increase hardness. Tr. 1100:18–1101:4. CeramTec refers to this as its first “data point” that

chromium might actually be a non-functional component of BIOLOX Delta. See id.

11. However, despite that research and a few additional studies in the late 2000s that

reached similar results, see PX-554, the company did not change its public stance that chromium

increased hardness. On the contrary, it maintained its position that chromium increased hardness

in additional submissions to the FDA in September 2008, October 2008, February 2012, October

2012, and June of 2013. PX-79; PX-86; PX-87 at 26–27; PX-22 at 6; PX-82; PX-88; PX-84 at

26; PX-166 at 34. CeramTec also reiterated this stance, as well as the fact that chromium turned

the product pink, in numerous training materials for its customers, research articles, and

marketing campaigns spanning this same time period. See, e.g., Tr. 1151:4–14, 2029:1–9

(referencing an e-mail chain involving the marketing “story” of chromium increasing hardness

that CeramTec adopted); DX-215 (e-mail chain); Tr. 223:4–231:1; PX-429 (Summary of

CeramTec presentations); PX-40 (Training Guide); PX-129 (Research).

12. In 2009 C5 entered the ceramic hip component market and began to compete with

CeramTec with two products of its own: (1) Cerasurf-p, a ceramic product that like BIOLOX

Delta contains chromium and is pink; and (2) Cerasurf-w, a white ceramic product that does not

contain chromium. DX-517; DX-090 at 91; DX-90 at 118; DX-517; Tr. 297:4-12; DX-519 at 9;

DX-065. Initially, C5’s internal testing revealed no difference in hardness or strength between

Cerasurf-p, which contains chromium, and Cerasurf-w, which does not. See DX-527.

Nevertheless, additional testing C5 conducted eventually showed statistically significant

Add. 14
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evidence that its pink material was harder than its white material. See, e.g., Tr. 1307:11–12,

1941:3–20. While the Cerasurf-p product looks identical to CeramTec’s BIOLOX Delta product

aside from the companies’ logos engraved on these products, C5 claims that it carefully designed

its product so that it did not infringe on CeramTec’s ‘816 patent. Tr. 923:1–13; Tr. 239:3–13.

13. Although BIOLOX Delta controlled the vast majority of the ceramic hip implant

market at this time, CeramTec soon grew concerned when C5 entered the market. See PX-44 at

62; PX-68 at 2. The company subsequently took three actions to preserve its market share. First,

on January 20, 2012 CeramTec filed an application with the United States Patent and Trademark

Office (“USPTO”) seeking trade dress protection on the pink color of chromium in BIOLOX

Delta on the principal register. DX-156; DX-157. In response to questions, CeramTec asserted

that the color pink was not a functional component of BIOLOX Delta. See DX-156 at 56-57, 65-

66; DX-157 at 53–54, 61–62. It informed the USPTO that “[t]he color pink is not a natural by-

product of the manufacture of implants generally, supported by the fact that none of Applicant’s

competitors create pink implants.” DX-156 at 56 (¶II.7), DX-157-53 (¶II.7) (emphasis added).

It added that the color pink is a result of CeramTec’s proprietary manufacturing process. Id.

Significantly, however, the response did not explain that the color pink was a natural byproduct

of the chromium in CeramTec’s implants or that CeramTec had for many years claimed that the

chromium was a functional component of its BIOLOX Delta products. Id. The USPTO

nevertheless rejected CeramTec’s application because it found that CeramTec had not acquired

secondary meaning or distinctiveness, which is necessary in order to register a color as trade

dress. DX-156 at 29–30; DX-157 at 29–30.

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14. Second, having been rejected by the USPTO, CeramTec obtained U.S.

Supplemental Trademark Registration Nos. 4,319,095 and 4,319,096 (the ‘095 and ‘096

registrations) for the pink color of chromium in hip implants. DX157 at 6; DX156 at 7.

15. The ‘816 patent expired in 2013.

16. On March 3, 2014 C5 took the offensive, initiating this lawsuit against CeramTec.

ECF No. 1 (Complaint).3 In its initial Complaint, C5 sought to cancel CeramTec’s ‘095 and

‘096 registrations and to obtain several other rulings regarding C5’s rights to manufacture and

market Cerasurf-p. Id. at ¶¶78–106.

17. CeramTec answered C5’s Complaint on September 25, 2014 with numerous

affirmative defenses and counterclaims of its own, asserting among other things that Cerasurf-p

infringed on CeramTec’s trademark registrations on the color pink. ECF 41; ECF No. 191.

18. As C5’s initial Complaint made clear, the threshold issue in this lawsuit was the

functionality of chromium in BIOLOX Delta. See generally ECF No. 1.

19. Roughly eight months after C5 filed suit and one month after CeramTec answered

C5’s initial Complaint, Dr. Meinhard Kuntz, the manager of oxide development at CeramTec,

Tr. 988:18–20, published a White Paper experiment that concluded that the introduction of

chromium in BIOLOX Delta did not increase hardness, DX-228 (published on October 22,

2014).

20. The authority of Dr. Kuntz’s paper, however, was undermined at trial because it

was not the product of a controlled experiment regarding chromium, it was not peer reviewed,

and because it contradicted decades of past research into the benefits of chromium, aside from a

few “data points” of contrary evidence referenced above. See Tr. 664:6–21, 1100:18–1110:23,

3
The Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331, 1338 and 2201 and 15 U.S.C.
§§ 1119 and 1121(a). The Court denied CeramTec’s motion to dismiss for lack of personal jurisdiction
on September 8, 2014. ECF No. 35.

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1265:2–11. The timing of the White Paper likewise did not bolster its credibility, nor, frankly,

did Dr. Kuntz’s trial testimony.

II. CONCLUSIONS OF LAW

The late Arnold Palmer once said that golf is a game that is deceptively simple but

endlessly complicated. Here, I find the opposite is true: while deceptively complicated, in the

end this case is relatively simple. From the ‘816 patent alone, but also from the abundance of

additional evidence in this case that chromium increases hardness, I find that chromium is a

functional component of BIOLOX Delta. See TrafFix Devices, Inc. v. Mktg. Displays, Inc., 532

U.S. 23, 28–30 (2001). As such, CeramTec cannot claim trade dress (or trade mark) protection

on the pink color that is a natural byproduct of the chromium used in that product. 4 See id.

Accordingly, judgment will enter in C5’s favor on Counts I and III of its First Amended

Complaint, ECF No. 124, and also in favor of C5 on CeramTec’s counterclaims, see ECF No.

191. In light of this holding, I do not reach or decide the merits of Count II of C5’s First

4
C5 has additionally argued that, regardless of whether chromium is functional, CeramTec is absolutely
precluded from claiming trade dress protection under the Tenth Circuit’s decision in Vornado Air
Circulation Systems, Inc. v. Duracraft Corp., 58 F.3d 1498, 1500 (10th Cir. 1995) because chromium was
a “described, significant inventive component” of the hip implant components covered by the ‘816 patent.
See Tr. 19:18–22 (opening statement for plaintiff). Under that test, C5 easily prevails in this case. But
CeramTec counters that Vornado is no longer good law after TrafFix, noting that Vornado created the
“circuit split” leading to that case. 532 U.S. at 29. As C5 rightly points out, TrafFix never confronted the
Tenth Circuit’s alternative “described, significant inventive component” standard head on, nor did it
explicitly state that it was overruling that decision. Nevertheless, I assume for purposes of this order that
TrafFix did overrule Vornado. For one thing, the Court in TrafFix framed the issue on appeal as
“whether the existence of an expired utility patent forecloses the possibility of the patentee’s claiming
trade dress protection in the product’s design.” Id. at 28 (emphasis added). The Court’s answer was
“no.” See id. at 29–30. Thus, the Court seemingly resolved the circuit split against the Tenth Circuit’s
position. See id. at 28 (noting in a parenthetical that Vornado held the opposite). I also note that, so far as
I can determine, only one court has quoted Vornado’s “significant inventive component” standard post-
TrafFix, and it did so in explaining the circuit split TrafFix resolved. Logan Graphics Prod., Inc. v.
Textus USA, Inc., No. 02 C 1823, 2002 WL 31870549, at *4 (N.D. Ill. Dec. 23, 2002), report and
recommendation adopted sub nom. Logan Graphic Prod., Inc. v. Textus USA, Inc., No. 02 C 1823, 2003
WL 21011746 (N.D. Ill. May 5, 2003).

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Amended Complaint. See ECF No. 124 at ¶¶97–110. Counts IV and V were previously

dismissed. ECF No. 182.

A. Background: Trade Dress Functionality Analysis.

In order to claim trade dress protection, the proponent of the trade dress must prove that

the feature on which it seeks protection is “non-functional.” Id.; see 15 U.S.C. § 1125(a)(3) (“In

a civil action for trade dress infringement under this chapter for trade dress not registered on the

principal register, the person who asserts trade dress protection has the burden of proving that the

matter sought to be protected is not functional.”); see also 15 U.S.C. § 1125(c)(4)(A) (similar

burden in actions for trade dress dilution). This is no easy task. Not only are features statutorily

presumed to be “functional,” but the Supreme Court has also laid out alternative tests for

determining whether a product feature is “functional” and preclusive of trade dress protection.

See TrafFix, 532 U.S. at 31–33.

One approach is competition-focused. See id. at 32. A product’s feature is “functional”

if the “exclusive use of [the feature] would put competitors at a significant non-reputation-related

disadvantage.” TrafFix, 532 U.S. at 32. For example, in John Deere & Co. v. Farmhand, Inc.,

560 F. Supp. 85, 98 (S.D. Iowa 1982), aff’d, 721 F.2d 253 (8th Cir. 1983), this definition of

functionality was applied to prevent John Deere from asserting trade dress protection on the

“green” color of its farm machinery. The court reasoned that because customers wanted their

farm machinery to match, precluding other companies from using “John Deere green” would put

them at a significant, non-reputation-related disadvantage in the market. See also Qualitex Co. v.

Jacobson Products Co., Inc., 514 U.S. 159, 165–66 (1995) (explaining the competition-focused

definition of functionality and holding that the green gold shade of a dry cleaning pad was non-

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functional as it served no non-trademark function). This definition of functionality is not at issue

in this case.

Alternatively, a feature is functional if “it is essential to the use or purpose of the device

or when it affects the cost or quality of the device.” TrafFix, 532 U.S. at 33 (emphasis added);

accord Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 456 U.S. 844, 850, n.10 (1982).

Framed in the disjunctive, this second definition of functionality is multifaceted. The “essential

to the use or purpose” prong is a primary focus in the present case. Although addressing the

issue in a design patent context, my colleague Judge Brimmer captured the concept well: “[T]he

crucial determination is not the availability of alternative designs, but whether the design at issue

is ‘the reason the device works.’” OraLabs, Inc. v. Kind Grp. LLC, No. 13-CV-00170-PAB-

KLM, 2015 WL 4538444, at *12 (D. Colo. July 28, 2015) (quoting TrafFix, 532 U.S. at 34).

Thus, in TrafFix, discussed in greater detail infra, the Supreme Court held that a dual-spring

feature of a road sign stand was “functional” despite the existence of equally effective three- or

four-spring designs because the two-spring feature on which trade dress protection was claimed

was the very aspect of the product that enabled it to achieve its intended purpose: withstanding

strong gusts of wind. TrafFix, 432 U.S. 23 at 34.

Under the alternative “affects the cost or quality” prong, courts have followed several

different paths in assessing functionality. For instance, when deciding whether a feature affects

“cost” (which like the competition-focused approach to determining functionality is not at issue

here) one can examine whether the feature at issue is “essential to achieving cost savings” in the

manufacturing process of the underlying product. See OraLabs, Inc., 2015 WL 4538444, at *13

(reasoning, in part, that because the spherical shape of the lip balm dispenser at issue in the case

did not lower the product’s cost, the unique design of the product on which trade dress protection

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was sought was non-functional). By contrast, in deciding whether the feature in question affects

“quality,” which is a definition of functionality that is pertinent here, the Federal Circuit has

examined whether or not the feature on which trade dress protection is sought has a purposeful

relationship with the underlying material of the product. See In re Owens-Corning Fiberglas

Corp., 774 F.2d 1116, 1123–24 (Fed. Cir. 1985) (holding that the “pink” color of insulation was

non-functional because it did not affect the quality of insulation in that the color used had no

effect on the product’s ability to regulate a building’s temperature).

B. TrafFix and a Prior Patent’s Application in Functionality Analysis.

Although courts for decades routinely assessed trade dress claims by deciding whether or

not the feature on which protection was claimed was “functional,” the Court in TrafFix Devices,

Inc. v. Marketing Displays, Inc. confronted a potentially disrupting circuit split: does “the

existence of an expired utility patent foreclose[] the possibility of the patentee’s claiming trade

dress protection in the product’s design[?]” TrafFix, 532 U.S. at 28 (citing Marketing Displays,

Inc. v. TrafFix Devices, Inc., 200 F.3d 929, 939 (6th Cir. 1999); Midwest Indus., Inc. v. Karavan

Trailers, Inc., 175 F.3d 1356 (Fed. Cir. 1999); Thomas & Betts Corp. v. Panduit Corp., 138 F.3d

277 (7th Cir. 1998); Sunbeam Products, Inc. v. West Bend Co., 123 F.3d 246 (5th Cir. 1997); and

Vornado Air Circulation Systems, Inc. v. Duracraft Corp., 58 F.3d 1498, 1500 (10th Cir. 1995).

As the Court recognized, this issue not only had the potential to short-circuit the

traditional functionality tests by which courts assessed trade dress protection, but it also raised

complex policy considerations concerning how patent law and trade dress law—two bodies of

law seemingly at odds with one another—should interact. Id. at 29 (“Trade dress protection

must subsist with the recognition that in many instances there is no prohibition against copying

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goods and products. In general, unless an intellectual property right such as a patent or copyright

protects an item, it will be subject to copying.”).

Striking a compromise of sorts, the Court held that while prior patents on a product’s

design do not foreclose the possibility of obtaining trade dress protection, patents nevertheless

have “vital significance” in trade dress functionality analysis. Id. “A utility patent is strong

evidence that the features therein claimed are functional.” Id. (emphasis added). Prior patents

therefore add “great weight to the statutory presumption that features [of the product] are deemed

functional until proved otherwise by the party seeking trade dress protection.” Id. at 30.

Given the substantial weight attached to prior patents, the Court warned that “one who

seeks to establish trade dress protection” on a feature claimed within a prior patent “must carry

the heavy burden of showing that a feature is not functional[.]” Id. at 30 (emphasis added). This

is not an impossible task. For instance, a party could carry this burden by proving that the

feature was “merely an ornamental, incidental, or arbitrary aspect of the device” (e.g., “arbitrary

curves in the legs” of the sign or “an ornamental pattern painted on the springs” of the device).

Id. But it is a quite difficult task.

The Court then turned to the feature on which trade dress protection was actually sought:

the road sign stand’s dual-spring mechanism. Recognizing that Marketing Displays, Inc.

(“MDI”), the party seeking trade dress protection, had not “pointed to [anything] arbitrary about

the components of its device or the way they are assembled[,]” the Court examined the claims of

MDI’s expired utility patents covering the device, the utility patents themselves, and the

statements MDI had made “in the course of procuring the patents” to assess the feature’s

functionality. Id. It found that not only had the prior patents claimed the use of the dual-spring

feature, but that this evidence collectively demonstrated that the dual-spring design was

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“essential” to the purpose of the device because it was “a unique and useful mechanism to resist

the force of the wind.” Id. at 33. In other words, the Court concluded, the dual-spring design

was “the reason the device works.” Id. at 33–34. Accordingly, the Court held that this feature

was “functional,” and that MDI was prevented from asserting trade dress protection on it. Id. at

33.

C. The Pink Color of Chromium in BIOLOX Delta is “Functional.”

Here, I conclude that CeramTec has failed to carry its heavy burden of proving that

chromium’s pink color in BIOLOX Delta is “non-functional.” See id. at 31–33. I reach this

conclusion after finding from the ‘816 patent covering BIOLOX Delta that chromium is an

“essential” component of that product. I also find, from the copious amount of additional

evidence presented at trial, that chromium, which gives BIOLOX Delta its pink color, see, e.g.,

Tr. 1127:3–4, is functional because it affects the “quality” of BIOLOX Delta.5 I begin, as the

Court did in TrafFix, with the patent.

1. The ‘816 Patent.

In claims 1 and 3 of the ‘816 patent, the latter of which CeramTec admits it practices in

producing BIOLOX Delta, CeramTec disclosed the use of a specific molar ratio of chromium to

produce harder ZTA ceramics. See DX-423 at 12 (the ‘816 patent); PX-17; Tr. 652:13–653:10

(“Here, you see claim 3 . . . you must have chromium oxide in order to create those claims.

Without those claims, without chromium oxide, those claims don’t exist. So claims 1 and claim

3 can’t exist without chromium oxide.”). These claims about chromium are, at the very least,

“strong evidence” of chromium’s functionality. See TrafFix, 522 U.S. at 29 (“A utility patent is

strong evidence that the features therein claimed are functional.”) (Emphasis added).

5
Concluding that the chromium in BIOLOX Delta is “functional” because it increases hardness, I
reiterate that this is a legal conclusion, not necessarily a scientific one, based on the evidence presented at
trial.

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But like the expired patents at issue in TrafFix, the ‘816 patent goes further. In addition

to claiming the use of chromium in ZTA ceramics, the ‘816 patent and statements CeramTec

“made . . . in the course of procuring” that patent explain that the addition of chromium in ZTA

ceramics solved an existing problem of a drop in hardness due to zirconium dioxide used to

toughen ceramic composites. DX-423 at 9, col. 3:39–42, col 3:51–66; PX-190 at 216. See Tr.

648:9–649:17. That is, through the use of chromium in a specific molar ratio with other

components, CeramTec made “it possible for the first time to achieve hardness values such as

have not previously been achieved at such zirconium dioxide contents[.]” DX-423 at 9, col.

3:61–64 (emphasis added).

By this language, chromium was not some minor or useless aspect of the ‘816 patent, nor

some minor component of BIOLOX Delta. Rather, just as the expired patents and MDI’s

statements in procuring them revealed to the Supreme Court that the dual-spring feature at issue

in TrafFix was the “central advance” therein claimed, the ‘816 patent and CeramTec’s

prosecution history similarly illustrate that chromium in the ‘816 patent, and therefore the

chromium in BIOLOX Delta, “is the reason the device works.” TrafFix, 532 U.S. at 30. As

such, the ‘816 patent establishes that chromium in BIOLOX Delta is “functional” because it is an

essential component of that product. See id. (“In the case before us, the central advance claimed

in the expired utility patents . . . is the dual-spring design; and the dual-spring design is the

essential feature of the trade dress MDI now seeks to establish and to protect. The rule we have

explained bars the trade dress claim, for MDI did not, and cannot, carry the burden of

overcoming the strong evidentiary inference of functionality based on the disclosure of the dual-

spring design in the claims of the expired patents.”). For this reason alone, CeramTec cannot

obtain trade dress protection on chromium’s pink color in BIOLOX Delta. See id.

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2. Additional Evidence of Chromium’s Functionality.

But, as I have indicated, there is more. Roughly four years after it obtained the ‘816

patent, CeramTec applied for and obtained another patent on ceramic materials: the ‘957 patent.

See PX-142. Like the ‘816 patent, the ‘957 patent similarly claimed the use of chromium in

ceramic composites. See id at 6, col. 9:31–46; Tr. 467:14–468:8. It too explained the essential

role chromium plays in ZTA ceramics, echoing the ‘816 patent in stating that the addition of

chromium in ZTA ceramics “counteracts any drop in the hardness values when the proportion of

zirconium dioxide rises.” PX-142 at 4, col. 5:41–44. Furthermore, years later, CeramTec

obtained yet another patent (the ‘970 patent) and applied for one more that both similarly teach

the use of chromium in producing ZTA ceramics. See PX-550 (the ‘970 patent), claims 1, 20;

PX-551 (U.S. Patent Publ. No. 2012/0142237), claim 8.

While CeramTec does not practice either of these latter two issued patents in producing

BIOLOX Delta, they are nonetheless telling. They reveal that up until this litigation

commenced, or at least up until CeramTec decided to claim trade dress protection on

chromium’s pink color one year earlier, the company’s stated position was that chromium

affected the quality of ZTA ceramics by increasing their hardness and that chromium was

therefore a functional component of these products.

Indeed, CeramTec’s own paper trail bears this out. Over the span of roughly two

decades, during which time the company now tells us that it discovered “data points” that

chromium might not be functional, CeramTec made no less than six FDA filings, published

additional research, and distributed training and marketing materials that all maintained that

chromium “affects the quality” of BIOLOX Delta by making it harder. See, e.g., PX-79 at 6;

PX-86 at 6; PX-87 at 26–27; PX-22 at 6; PX-82; PX-88; PX-84 at 26; PX-166 at 34; Tr. 1151:4–

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14; 2029:1–9; Tr. 223:4–231:1; PX-429; PX-129. For this additional, but related, reason, I find

that chromium is a functional component of BIOLOX Delta.

CeramTec nevertheless makes two principal counter-arguments why the pink color of

chromium is actually a non-functional component of BIOLOX Delta. I discuss both in turn.

3. Counter-Argument #1: Even if Chromium is Functional, its Pink Color is Not.

CeramTec’s first argument attempts to thread the needle. It distinguishes between

chromium and chromium’s pink color, arguing that while the former may be a functional feature

of BIOLOX Delta, the latter is not because it is merely ornamental, incidental, or arbitrary.6 In

that vein, CeramTec argues that the “pink” color of BIOLOX Delta should be considered similar

to other non-functional colors of products—for instance, the “pink” color of insulation that the

Federal Circuit deemed non-functional in In re Owens-Corning Fiberglas Corporation. See 774

F.2d at 1123–24. This argument, however, is unconvincing for two reasons.

First, the comparison is faulty. As the Federal Circuit noted in In re Owens-Corning

Fiberglas Corporation, the pink color of the company’s insulation was non-functional because it

bore “no relationship to production of fibrous glass insulation.” Id. at 1123 (emphasis added).

Rather, it was a color that the company “uniformly applied” to the insulation during production

simply for trademark purposes. Id.; see also, e.g., Ideal Toy Corp. v. Plawner Toy Mfg. Corp.,

685 F.2d 78, 81 (3d Cir. 1982) (finding the district court did not err when it determined that the

colors of the panels on a Rubik’s Cube were “non-functional” as the colors themselves bear no

relationship to the underlying puzzle because the point of the game was to “end where one has

begun,” meaning the colors used were arbitrary).

6
CeramTec points out that while chromium was claimed in the ‘816 patent, its pink color was not. As
discussed infra, however, that is a distinction without a difference.

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By contrast, chromium’s pink color is the natural byproduct of the chromium that is used

in the production of BIOLOX Delta. Dr. Kuntz, CeramTec’s manager of oxide development,

admitted this fact at trial. Tr. 1127:3–4 (“Q: BIOLOX Delta is pink because it has chromium,

correct? A: Yes, it is correct.”). Thus, one cannot logically separate the chromium, which is a

functional component, from the color that it produces. Moreover, unlike in In re Owens-Corning

Fiberglas Corporation, I find that there is no credible evidence that CeramTec initially decided

to make its product “pink” purely because it wanted to attempt to use that color later on for

trademark or trade dress purposes. Rather, CeramTec chose to introduce chromium in this ZTA

ceramic product because the research, much of which the company conducted, showed that

chromium counteracted a drop in hardness caused by increasing concentrations of zirconium,

and because that was ultimately its means of obtaining the patent. Thus, chromium’s “pink”

color in BIOLOX Delta is not some arbitrary design flourish. Rather, it is a feature

fundamentally related to the underlying product it adorns.

But CeramTec’s attempt to distinguish chromium’s pink color is also unpersuasive for an

additional reason: it turns trade dress protection on its head. See, e.g., Leatherman Tool Grp.,

Inc. v. Cooper Indus., Inc., 199 F.3d 1009, 1013 (9th Cir. 1999). The Ninth Circuit explained it

well. Dealing with an argument that the overall design of a multi-function pocket tool could be

distinguished from the functional components (i.e. the tools) comprising it, the court noted that

“it is semantic trickery to say that there is still some sort of separate ‘overall appearance’ [of the

product] which is non-functional.” Id. It reasoned that “[i]f it is permissible to draw a

distinction between . . . [a functional] object and its ‘general appearance,’ then virtually nothing

is utilitarian, and virtually the only product designs which could be copied faithfully are those

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which are widely used and therefore in the public domain.” Id. The Ninth Circuit considered

this to be an untenable outcome. See id. I agree.

Consider the implications. If CeramTec is correct that the general appearance of a

functional feature can be distinguished from the underlying functional object, then the “orange”

color of orange juice can be distinguished from the orange fruit used to make it. By that logic,

Tropicana, Minute Maid, or any other orange juice company could obtain trade dress protection

on an “orange-colored” fruit juice made from oranges, asserting that while the orange fruits used

to make the juice are functional, their attendant “orange color” is merely incidental. As a result,

one orange juice company could prevent all others from producing “orange-colored” orange

juice.

4. Counter-Argument #2: Chromium does not Actually Increase Hardness.

CeramTec’ second main contention is that despite the large amount of evidence of

chromium’s functionality, much of which CeramTec produced, the science now suggests that

chromium does not increase hardness and therefore that chromium is actually a non-functional

component of BIOLOX Delta.7 In making this argument, CeramTec highlights the “data points”

7
Within its second argument CeramTec makes another attempt at threading the needle, contending that
while chromium may be functional when present in certain quantities, the small amount of Chromium
used in BIOLOX Delta (0.33%) is non-functional. Tr.1022:23–1023:7 (“[T]here is a level of chromium
content which gives an impact [on hardness]. We understand so far, from our own experiments, that this
level is at least at the range of 0.5 percent[.]”). However, as explained infra, I find that CeramTec cannot
overcome the bulk of evidence in this case, especially the prior patents that reveal that chromium, even
when present in the small quantity that exists in BIOLOX Delta, is functional. See, e.g., PX-550 at 3, col.
3:15, col. 4:27–29.

Similarly, I find unconvincing CeramTec’s assertion that chromium is “non-functional” because a “drop”
in hardness caused by zirconium, which chromium corrects, “does not constitute a disturbing effect” in
some materials. See PX-142 at 7:14–18. First, as this language from the ‘957 patent reveals, whether or
not a drop in hardness is “disturbing” is very context-specific. Here, in the context of ceramic hip
implants, the evidence shows that it actually can be. See, e.g., Tr. 454:20–3 (noting that suffering a drop
in hardness was a “disturbing effect” for ceramic hip ball implants). Furthermore, CeramTec’s argument
on this point is unpersuasive because even an answer to a “non-disturbing” problem can still constitute a
functional solution to that issue. That is, as the Supreme Court’s alternative definitions of functionality

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of contrary research from the 2000s, but it leans most heavily on the White Paper published in

2014 by CeramTec’s own Dr. Meinhard Kuntz, in which Dr. Kuntz concludes that the level of

chromium present in BIOLOX Delta does not have an impact on the hardness of that product.

See DX-228. However, for two reasons I find this attempt to put the toothpaste back in the tube

unavailing.

First, CeramTec’s argument is of questionable foundation. As mentioned above, it relies

strongly on Dr. Kuntz’s 2014 White Paper. The authority of that research, however, was

significantly undermined at trial by numerous witnesses whom picked apart the experiment’s

methodology and conclusions.8 See, e.g., Tr. 680:24–681:2 (“[I]t’s not really a believable article

to take away all of the years of research that suggest [chromium increases hardness].”).

Furthermore, as already described above, CeramTec’s newfound position on chromium clashes

with the vast majority of evidence in this case, including the ‘816 patent and CeramTec’s own

decades-long paper trail. See supra Parts II.C.1–2. As I said, I did not find CeramTec’s position

(or Dr. Kuntz’s testimony) to be credible, as it was plainly slanted to achieve a litigation

objective. Accordingly, I find that CeramTec simply fails to carry its resulting “heavy burden”

of proving chromium’s non-functionality. See TrafFix, 532 U.S. at 30.

D. Estoppel.

Finally, even if science conclusively proved that the chromium in BIOLOX Delta does

not in fact achieve any increase in hardness (which was not conclusively proved in this case), I

conclude that CeramTec is estopped from denying that chromium is functional based on the

reveal, a component of a product can still be functional even if it is not essential to a product so long as it
affects its “cost” or “quality.” See supra Part II.A.
8
CeramTec also contends that C5 has used chromium in Cerasurf-p solely as a means of mimicking
BIOLOX Delta’s pink color, which suggests that chromium is nonfunctional because C5 believes
chromium does not have any purported effect on ceramic hardness. Assuming for the sake of argument
that this allegation is indeed true, it simply fails to tip the balance of the analysis in CeramTec’s favor.

18

Add. 28
Case 1:14-cv-00643-RBJ-CBS Document 308 Filed 04/20/17 USDC Colorado Page 19 of 21

contrary language of the various patents, the representations it made to the Patent Office to

obtain the patents, and its representations to the FDA, its representations to its customers and

potential customers, and its representations in scientific papers, all made during the period that

CeramTec was enjoying the monopoly created by the ‘816 patent. Cf. Disc Golf Ass’n, Inc. v.

Champion Discs, Inc., 158 F.3d 1002, 1008 (9th Cir. 1998) (“A trademark proponent cannot

create an issue of material fact regarding . . . [a feature’s] functionality, and thus survive

summary judgment, by contradicting an earlier assertion contained in an expired utility patent

that the [feature] is functional. ‘A kind of estoppel arises. That is, one cannot argue that a shape

is functionally advantageous in order to obtain a utility patent and later assert that the same shape

is non-functional in order to obtain trademark protection.’”) (quoting McCarthy, § 7:89.30); see

also Eco Mfg. LLC v. Honeywell Int’l, Inc., 295 F. Supp. 2d 854, 872 (S.D. Ind. 2003), aff’d sub

nom. Eco Mfg. LLC. v. Honeywell Int’l, Inc., 357 F.3d 649 (7th Cir. 2003) (finding the round

design of Honeywell International, Inc.’s thermostat was functional on estoppel grounds based

on “sworn claims of the round shape’s utility that Honeywell made to secure issuance of” a claim

in its prior patent on the product).

ORDER

The undisputed evidence established that BIOLOX Delta hip implant components

produced by CeramTec are excellent products. The evidence also established that CeramTec

spent many years developing a reputation for quality with OEMs, hospitals and surgeons, and

that today many surgeons associate the color pink with CeramTec’s products. But for the

reasons discussed above, this is an instance where copying is not foreclosed by what otherwise

would be protection of trade dress. Accordingly, the Court enters the following orders:

19

Add. 29
Case 1:14-cv-00643-RBJ-CBS Document 308 Filed 04/20/17 USDC Colorado Page 20 of 21

1. The Court directs that judgment enter in favor of C5 and against CeramTec on Counts

I and III of C5’s First Amended Complaint. ECF No. 124. Because the Court has found that the

use of chromium oxide in BIOLOX Delta is functional, and alternatively because the Court has

found that CeramTec is estopped from denying its functionality, and because the color pink is the

natural byproduct of the use of chromium oxide, the Court declares that CeramTec cannot and

therefore does not own any trademark or trade dress rights in the color pink. The Court further

declares that plaintiffs are not infringing upon any purported rights in the color pink, and that

plaintiffs are not competing unfairly by marketing ceramic hip implant components that have the

same or similar pink color as CeramTec hip implant components. I assume that, based on these

findings and conclusions, United States Supplemental Registration Nos. 4,319,095 and 4,319,096

will be cancelled, although I do not directly so order because the United States Patent &

Trademark Office is not a party to this case. CeramTec is enjoined from seizing C5’s products

or otherwise interfering with plaintiffs’ efforts to market pink orthopedic products based upon

any claim of trademark or trade dress protection for the color pink. Count II of the First

Amended Complaint is deemed moot in light of the Court’s resolution of Counts I and III.

2. Judgment will also enter in favor of C5 and against CeramTec on its counterclaims

against C5 (asserting federal trademark infringement, federal unfair competition, common law

trademark infringement under Colorado law, common law unfair competition under Colorado

law, and deceptive business practices under Colorado law as set forth at ECF No. 191). Those

claims are dismissed with prejudice.

3. The Court finds that the C5 is the prevailing party for purposes of Fed. R. Civ. P.

54(d)(1). It may apply for an award of costs to be taxed by the Clerk of Court as provided in

D.C.COLO.LCivR (local rule) 54.1.

20

Add. 30
Case 1:14-cv-00643-RBJ-CBS Document 308 Filed 04/20/17 USDC Colorado Page 21 of 21

DATED this 20th day of April, 2017.

BY THE COURT:

___________________________________
R. Brooke Jackson
United States District Judge

21

Add. 31
 /Certified Translation from the German Language/

/Stamp mark:/
Certified Copy

Case No.: /Stamp mark:/

17 O 1790/13 Received
1 FEB. 2018
Hogan Lovells International LLP
Hamburg
/Handwritten:/ ED
1

/Coat of arms of the German Land of Baden-Württemberg/

Regional Court of Stuttgart

/Stamp mark:/
Hogan Lovells
Deadline /handwritten:/ 1 Mar. 2018
1st interim deadline /handwritten:/ 22 Feb. 2018
2nd interim deadline /handwritten:/ 26 Feb. 2018
Type of deadline /illegible handwritten entry/
Entered by /illegible signature/
Caseworker /handwritten:/ Bothe/Kohlmeier

/Stamp mark:/ /Stamp mark:/

Hogan Lovells Hogan Lovells
Deadline /handwritten:/ 15 Feb. 2018 Deadline /handwritten:/ 3 Apr. 2018
1st interim deadline /handwritten:/ 8 Feb. 2018 1st interim deadline /handwritten:/ 27 Mar. 2018
2nd interim deadline /handwritten:/ 12 Feb. 2018 2nd interim deadline /handwritten:/ 30 Mar. 2018
Type of deadline /illegible handwritten entry/ Type of deadline /illegible handwritten entry/
Entered by /illegible signature/ Entered by /illegible signature/
Caseworker /handwritten:/ Bothe/Kohlmeier Caseworker /handwritten:/ Bothe/Kohlmeier

In the name of the people

Judgement

In the legal matter of

CeramTec GmbH, represented by managing director Dr. Ulf-D. Zimmermann (chairman),

Rolf-Michael Müller, Sigurd Adler, CeramTec-Platz 1-9, 73207 Plochingen
- Plaintiff -

Legal counsel:
Lawyers Hogan Lovells, Alstertor 21, 20095 Hamburg, file No.: 730457

versus

Add. 32
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17 O 1790/13

Metoxit AG, represented by its supervisory board, the board represented by President
Hans-Karl Felber, Emdwiesenstr. 6, 8240 Thayngen, Switzerland
- Defendant -

Legal counsel:
Lawyers DTS Patent- und Rechtsanwälte Schnekenbühl und Partner mbB,
Marstallstrasse 8, 80539 München [Munich], file No.: 20776.AGM.M241DE.EU

on account of trade mark infringement,

the Regional Court of Stuttgart - 17th Civil Division - through presiding judge at the regional
court Rzymann, judge at the regional court Helms, and judge Gleiter decreed as follows on the
basis of the oral proceedings of 12 December 2017:

1. The Defendant is ordered, on penalty of a fine up to €250,000 to be determined by the

court in each case of culpable violation, alternatively detention, or detention up to six
months, in the event of repeated violation up to a total of two years, to be enforced on the
Defendant’s particular legal representatives, to cease and desist to use and/or have used
the colour pink (Pantone 677 C, 2010) for distinguishing hip joint implants in the course of
trade in the territory of the European Union with the exception of France if such use occurs
in the manner illustrated below:

2. The Defendant is ordered to provide the Plaintiff with information regarding the territory of
the Federal Republic of Germany as to when and in which scope the Defendant has
committed acts according to Clause 1,

a) indicating the distribution channel of the goods mentioned under Clause 1,

Add. 33
 -3-
17 O 1790/13

b) indicating the names and addresses of commercial buyers and points of sale for whom
these goods have been intended,

c) additionally indicating the volume of the goods produced, delivered and ordered and the
prices paid for the goods,

d) furthermore, presenting a list from which the turnovers including all cost factors, in each
case broken down by calendar quarter, generated for the goods mentioned under Clause
1 can be obtained.

3. The Defendant is ordered, with regard to the territory of the Federal Republic of Germany,
to destroy the goods as defined under Clause 1 in its possession and/or ownership and
provide the Plaintiff promptly with written evidence thereof.

4. The Defendant is ordered, with regard to the territory of the Federal Republic of Germany,
to recall the goods mentioned under Clause 1 and remove them from the distribution
channels for good.

5. The Defendant is ordered to pay €4,299.50 plus interest in the amount of 5% points above
the base rate to the Plaintiff from 3 January 2014.

6. It is found that the Defendant is obliged to compensate the Plaintiff for any and all losses
already occurred and/or yet to be occurred from the violations according to Clause 1 with
regard to the territory of the Federal Republic of Germany.

7. In other respects, the action is dismissed.

8. The Defendant is ordered to bear the costs of the legal dispute.

9. The judgement is provisionally enforceable:

- Clause 1 of the operative provisions of the judgement by way of security in the amount of
€ 30,000;

- Clause 2 of the operative provisions of the judgement by way of security in the amount of
€2,500;

Add. 34
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17 O 1790/13

- Clauses 3 and 4 of the operative provisions of the judgement by way of security in the
amount of €5,000;

In addition, the judgement is provisionally enforceable upon providing security in the

amount of 110% of the amount subject to enforcement in each case.

10. The value of dispute is assessed at up to €500,000.

Add. 35
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17 O 1790/13

Facts of the case

The Plaintiff asserts against the Defendant claims for cease and desist, information and
accounting, destruction, recall, determination of the liability to payment of compensation, as
well as the payment of pre-trial legal costs under the trade mark law and, alternatively, under
the competition law. Background of the legal action are pink coloured hip joint implants which
the Defendant at least presented at the SOFCOT, a congress for orthopaedics and
traumatology, which took place in Paris from 11 November 2013 to 14 November 2013.

The parties are manufacturers of implant components made of ceramics, amongst others, of
so-called hip joint implants and disc inserts, which are used in endoprosthetics to permanently
replace damaged condyles and sockets in the human body. The products mainly
manufactured by the parties are so-called supplied goods purchased by prosthesis
manufacturers which build these together with the prosthesis stem and other components into
complete prosthesis systems. These complete prosthesis systems are then implanted into
patients by surgeons and orthopaedists performing surgery.

The Plaintiff, who has its seat in Germany, is the owner of numerous trade marks which are all
registered, amongst others, for “hip joint implants”. Amongst the trade marks there is, amongst
others, the European Union trade mark No. EM010214195, an abstract colour mark - colour
pink (Pantone 677 C, 2010), with priority of 23 August 2011. Regarding the other trade marks
registered for the Plaintiff’s benefit and the order of their assertion, reference is made to pages
14-17, 22 et seq. of the complaint of 11 December 2013 (sheets 14-17, sheets 22 et seq. of the
file, volume I) as well as the register extracts submitted as Exhibit K 6.

The hip joint implants manufactured by the Plaintiff of ZTA ceramics have, by way of addition of
the chemical compound yttrium chromite, a doping with chromium oxide of approx. 0.32
percent by weight (hereinafter: wt%). The Plaintiff first of all had the chemical composition of its
hip joint implants protected by patent No. DE 4024877C2 (cf. Exhibit B 5) filed on 6 August
1990, with the patent claiming, amongst others, a chromium oxide content ranging from 0.01 to
1.41wt%. The patent protection existed for 20 years. According to the Plaintiff, the patent
protection was based at least initially on the assumption that the addition of chromium oxide
would increase the hardness and wear resistance of the ZTA ceramics used for the
manufacture of its hip joint implants (cf. the pleading of 24 March 2014, therein: pages 5 et
seq., sheets 77 et seq. of the file, volume II). The addition of chromium oxide causes a pink
colouration of the ZTA ceramics, the intensity of which ranges from “light pink” in the case of a
low concentration of chromium oxide to “ruby red” in the case of a high concentration of

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17 O 1790/13

chromium oxide. In the instance of a chromium oxide content of approx. 0.32wt% as added by
the Plaintiff to its ZTA ceramics, a pink colour is obtained which corresponds to the pink colour
(Pantone 677 C, 2010) now claimed by the Plaintiff in its mark. The Plaintiff launched its pink
coloured hip joint implants manufactured with the addition of chromium oxide on the market in
the year 2003. Since then the Plaintiff has continuously and exclusively sold its hip joint
implants in this colour.

At the SOFCOT, a congress for orthopaedics and traumatology, which took place in Paris from
11 November 2013 to 14 November 2013, the Defendant, who is based in Switzerland,
presented its hip joint implants, which until that point in time had been white, in pink colour as
well. Thereupon, the Plaintiff obtained a decision of the President of the Tribunal de Grande
Instance de Paris (cf. Exhibit K 8) on 14 November 2013 to conduct proceedings for the
preservation of evidence (in French: saisie-contrefacon) at the SOFCOT. The bailiff
commissioned took the photos of the pink coloured hip joint implants presented by the
Defendant at the SOFCOT, which can be seen under Clause 1 of the operative provisions of
the judgement. The Defendant refused to hand over the pink coloured hip joint implants
presented at the SOFCOT, with the reasons for such refusal being disputed between the
parties.

Subsequently, the Plaintiff gave the Defendant a warning and requested the Defendant to
cease and desist the use of the pink coloured hip joint implants. The Defendant rejected the
claims asserted by the Plaintiff in its written warning. Regarding the details of the pre-trial
correspondence, reference is made to Exhibit K 9.

The Defendant then filed an application for a declaration of invalidity on account of the
existence of alleged absolute grounds for invalidity with the Office for Harmonisation in the
Internal Market (OHIM) on 27 November 2013, amongst others, with regard to the European
Union trade mark No. EM010214195. With regard to the contents of the application of 27
November 2013 and the other applications for cancellation filed by the Defendant regarding
other marks of the Plaintiff, which are here at issue as well, reference is made to Exhibits B 1 to
B 4. The proceedings for cancellation and invalidity are currently not yet concluded.

With the pleading of 14 February 2014 (sheets 60 et seq., 66 of the file, volume II), the
Defendant has petitioned to suspend the litigation until a final decision has been taken
regarding the applications for the declaration of invalidity and cancellation. The division has not
suspended the present litigation, but taken evidence by obtaining a written expert opinion with
the order to take evidence of 27 May 2014 (sheet 108 of the file, volume II) in conjunction with

Add. 37
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17 O 1790/13

the amendment to the decision of 20 October 2014 (sheet 151 of the file, volume III). Under
Clause III of the order to take evidence of 27 May 2014 (sheet 108 of the file, volume II), the
division requested the Defendant to submit one of the workpieces presented at the SOFCOT in
Paris in November 2013 within 3 weeks. The Defendant has not complied with this request. For
the preparation of the expert opinion, the Defendant manufactured new material samples
which, according to the Defendant’s submission which is contested by the Plaintiff, allegedly
have the same chemical composition as the hip joint implants presented at the SOFCOT. The
experts have stated in their report of 30 August 2016 that the addition of chromium oxide does
not have a positive effect on the degree of hardness and wear resistance of the ZTA ceramics.
The parties have not raised any objections against the experts’ findings in their report as such.
Regarding the contents of the expert assessment assignment and the details of the result of
the taking of evidence, reference is made to the amendment to the decision of 20 October
2014 (sheet 151 of the file, volume III) and the expert report of 30 August 2016 (sheet 242 of
the file, volume III).

The Plaintiff first of all contests that the hip joint implants presented by the Defendant at the
SOFCOT have a chromium oxide doping at all. After all, and this has remained undisputed
between the parties, the hip joint implant shown in the article reporting on the Defendant on
"www.devicemed.fr" (Exhibit K 11) has been subsequently coloured pink by means of
graphical editing only. Since the Defendant has not complied with the court’s request
according to Clause III of the order to take evidence of 27 May 2014 and has not made
available to the expert the hip joint implants exhibited at the SOFCOT, the Defendant has not
adduced evidence discharging the burden whether the hip joint implants exhibited at the
SOFCOT, which constitute the first offence, have a chromium oxide doping at all and have not
been coloured pink subsequently only. The material samples produced for the court
assessment do not guarantee that the original “prototypes” exhibited at the SOFCOT have
been mixed with a chromium oxide content as well. Therefore, it must be implied that the
Defendant has no interest at all in adding chromium oxide to its hip joint implants, but only to
launch its products in pink colour based on the Plaintiff’s products no matter how such pink
colouration is obtained.

Irrespective thereof, the Defendant’s hip joint implants at issue, which were exhibited at the
SOFCOT, would constitute an infringement of trade mark rights even when their chemical
composition matched that of the material sample which the Defendant has specifically
produced for these proceedings and the expert opinion. For the expert opinion, which has also
been accepted by the Defendant, confirms that the chromium oxide, with the exception of pink
colouration, has no effect at all in terms of a technical function by enhancing the level of

Add. 38
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17 O 1790/13

hardness or the wear resistance of the ZTA ceramics. Accordingly, the Defendant need not
rely on the addition of chromium oxide for the manufacture of its hip joint implants. Irrespective
thereof, the Defendant is not barred from using chromium oxide. As submitted by the
Defendant itself, the chromium oxide content ranging from 0.01 to 1.41wt% claimed by the
meanwhile expired patent offers a large range of colours from “light pink” to “ruby red”. Against
this background, there is no need for protection of the fact that the Defendant chooses
precisely the chemical composition of the Plaintiff’s products with a chromium oxide content of
approx. 0.3wt% which leads to the meanwhile trade mark protected colour “Pantone 677 C”.
This specific chromium oxide content only serves to imitate the Plaintiff’s well-known products
in violation of the trade mark law and, as has been asserted in the alternative, of the
competition law, which, due to the pink colour, would have a unique distinguishing feature on
the market. All trade marks registered are eligible for protection. The colour pink is, also seen
against the background of the Plaintiff’s high market share, understood by the public as a
commercial indication of the Plaintiff, especially since also other competitors use the colour of
their hip joint implants as a distinguishing feature in the market environment. Irrespective
thereof, the court seised is bound to the registration of the trade marks.

This is, based on what has been said above, a case of double identity, but in any case a case
of likelihood of confusion and in a third line the exploitation of a well-known trade mark.
Consequently, the Plaintiff would be easily entitled to the claims for cease and desist,
determination of the liability to payment of compensation, information, accounting, destruction,
recall and payment of pre-trial legal cost arising from the justified written warning, asserted with
the legal action against the Defendant. Alternatively, an injunctive relief plus any and all
subsequent claims would arise for Germany also from the UWG [German Fair Trade Practices
Act], amongst other things, under the aspect of unlawful imitation and exploitation of
reputation.

That the Plaintiff had erroneously and, based on the state of the art at that time, initially
assumed a technical function of the chromium oxide doping in the past and therefore had
applied for and been granted patent protection, does not render the assertion on its trade mark
rights or the UWG an abuse of rights. In particular, since it does not claim the chromium oxide
doping as such for itself, but only a specific colour from a wide range of colours that can be
obtained with the chromium oxide content ranging from 0.01 to 1.41wt% claimed by the
meanwhile expired patent.

Add. 39
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17 O 1790/13

The Plaintiff petitions to

1. order the Defendant, on penalty of a fine up to €250,000 to be determined in each case
of culpable violation, alternatively detention up to six months, or detention up to two years,
to cease and desist to use and/or have used the colour pink (Pantone 677 C, 2010) for
distinguishing hip joint implants in the course of trade in the territory of the European Union
with the exception of France if such use occurs in the manner illustrated below:

« the four figures that can be seen under Clause 1 of the operative provisions of the judgement
follow here »

2. order the Defendant to provide the Plaintiff with information as to when and in which
scope the Defendant has committed acts according to Clause 1,

a) indicating the distribution channel of the goods mentioned under Clause 1,

b) indicating the names and addresses of commercial buyers and points of sale for
whom these goods have been intended,

c) additionally indicating the volume of the goods produced, delivered and ordered and
the prices paid for the goods,

d) furthermore, presenting a list from which the turnovers including all cost factors, in
each case broken down by calendar quarter, generated for the goods mentioned under
Clause 1 can be obtained.

3. order the Defendant to destroy the goods as defined under Clause 1 in its possession
and/or ownership and promptly provide written evidence thereof.

4. order the Defendant to recall the goods according to the relief sought regarding 1 and
remove them from the distribution channels for good.

5. order the Defendant to pay €4,839.50 plus interest in the amount of 5% points above the
base rate to the Plaintiff from the date on which the proceedings became pending.

6. find that the Defendant is obliged to compensate the Plaintiff for any and all losses
already occurred and/or yet to be occurred from the violations according to Clause 1.

Add. 40
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17 O 1790/13

The Defendant petitions to

dismiss the action.

The Defendant submits that the hip joint implants presented at the SOFCOT were so-called
prototypes. It has not manufactured and sold such hip joint implants either beforehand or
afterwards. The Defendant has slowed down its research programme due to the ongoing
litigation and will wait for the court’s decision before launching series production. Therefore, it
has not been possible for the Defendant to remove any ball heads “from the warehouse” in
order to comply with Clause III of the order to take evidence of 27 May 2014, but needed to
procure corresponding specimens manufactured in accordance with the Plaintiff’s expired
patent from its laboratories. However, the specimens (ZTA pink) submitted for the review on
the part of the court’s expert had the same composition as the implants exhibited and
promoted at the Paris trade fair. They would be, with regard to their chemical composition,
within the scope of the protection of the Plaintiff’s expired patent as they followed its exemplary
embodiment and in particular contained approx. 0.3wt% chromium oxide (cf. the Defendant’s
pleadings of 2 July 2014, therein pages 1 et seq., sheets 115 et seq. of the file, volume III; of 29
July 2014, therein pages 1 et seq., sheets 127 et seq., volume III; and of 3 May 2017, therein
pages 2 and 9, sheets 295 and 302 of the file, volume IV). It can be taken from the consistent
colour distribution throughout the specimen that the specimen has not been coloured
subsequently.

The Defendant basically is of the opinion that the Plaintiff cannot assert its marks on account of
the objection of descriptive use pursuant to Art. 14(1b) EUTMR (cf. Art. 12b CTMR old
version), pursuant to Section 4(4) UWG and pursuant to Section 242 BGB [German Civil
Code], in particular, under the aspects of an unlawfully acquired legal status, contradictory
behaviour, and of the “dolo agit” defence.

First of all, the Plaintiff's claim is opposed by the objection of descriptive use. The colour pink is
merely a descriptive indication to the effect that the ZTA ceramics contain chromium oxide.

In addition, the Plaintiff cannot assert its registered trade marks in good faith.

The Plaintiff prevented its competitors from adding chromium oxide during the term of the
unlawfully granted patent and thus has illegally obtained a monopoly position. During the
monopoly position the Plaintiff, due to the associated advertising of its products as being
extremely wear-resistant, ductile and hard as a result of the addition of chromium oxide, has

Add. 41
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17 O 1790/13

created expectations on the relevant public that a particularly reliable hip joint implant always
requires the addition of chromium oxide, ideally in the dosage used by the Plaintiff, to enhance
the level of hardness and wear resistance. By having registered numerous (colour) marks after
the unlawfully obtained patent has expired, the Plaintiff perpetuates the monopoly unlawfully
obtained due to the erroneously granted patent protection within the meaning of a factual
extension.

However, the Plaintiff cannot reasonably invoke the renown obtained during the term of the
erroneously granted patent and the thereby unlawfully obtained monopoly position, either for
the question of the distinctiveness of its marks concerning the registrability of a trade mark or
within the scope of the question of use as a mark on the Defendant’s part. This behaviour
constitutes an unlawful exercise of its rights in the form of a dishonest acquisition of its own
legal status.

Furthermore, the Plaintiff’s assertion of its marks in the present proceedings is opposed by the
“dolo agit” defence, since all marks are ready for cancellation on account of absolute grounds
of non-registrability or grounds for invalidity and therefore are formal legal positions only. On
one hand, the pink colour of the hip joint implants merely is a technically caused consequence
of the addition of chromium oxide according to the exemplary embodiment of the Plaintiff’s
patent. However, technically caused product features may not constitute a trade mark. On the
other hand, the colour pink lacks any distinctiveness. The colour pink lacks the function of
indicating origin which the public, due to the patent protection for decades and the associated
advertising on the Plaintiff’s part, understands solely as an indication for the chemical
composition. Any function of indicating origin of the colour pink, which is disputed by the
Defendant, is at most a dependent, not trade mark law protectable side effect of the Plaintiff’s
unlawfully obtained monopoly position for many years, the implications of which on the
Plaintiff’s renown may not be lawfully claimed by the Plaintiff anyway.

Also under the aspect of “venire contra factum proprium” the Plaintiff is barred from asserting
its marks. After all, the Plaintiff, who has advertised the particular wear resistance and
hardness of its products due to the addition of chromium oxide and has created a
corresponding situation of trust in the relevant public, behaves in a contradictory manner if it
now uses the contrary statement within the scope of the trade mark law.

Regarding further details of the parties’ submissions, reference is made to the pleadings
including exhibits exchanged and to the minutes of the oral proceedings of 1 April 2014, of 4
May 2017, and of 12 December 2017.

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Reasons for the decision

The admissible action is substantiated within the scope evident from the operative provisions
of the judgement.

A.

The action is admissible.

I.

The regional court of Stuttgart has international jurisdiction in accordance with Art. 125(2)
EUTMR (cf. Art. 97(2) CTMR old version, which is identical in content) as the Defendant, who
has its seat in Switzerland, does not have a subsidiary in any of the member states of the
European Union, while the Plaintiff has its seat in Plochingen (Germany). The subject matter
jurisdiction emerges from Art. 123(1), 124 EUTMR (cf. Art. 95(1), 96 CTMR old version, which
is identical in content) in conjunction with Sections 125e(1), (3) MarkenG [German Trade Mark
Act] in conjunction with Section 13(1) No. 2 ZuVOJu [German Ordinance on Judicial
Competence]. The local jurisdiction of the regional court of Stuttgart arises from Art. 123(1),
125(2) EUTMR ((cf. Art. 95(1), 97(2) CTMR old version, which is identical in content) in
conjunction with Section 125g Sentence 1 MarkenG in conjunction with Section 32 ZPO
[German Code of Civil Procedure] when taking into account the undisputed submission of the
Plaintiff, according to which the Defendant exhibited the hip joint implant prototypes at issue in
this litigation at a trade fair in Stuttgart in March 2013 as well (cf. regarding the maintenance of
European Union-wide jurisdiction in the case of conferral of local jurisdiction of the European
Union trade mark court in accordance with the procedures of national law on the court where
the unlawful act has been committed: Eisenführ/Schennen, UMV, 5th edition 2017, Art. 98
EUTMR marginal No. 6). Irrespective thereof, local jurisdiction of the regional court of Stuttgart
also emerges from Art. 123(1), 125(2) EUTMR (cf. Art. 95(1), 97(2) CTMR old version, which is
identical in content) in conjunction with Section 125g Sentence 2 MarkenG in conjunction with
Section 13(1) No. 2 ZuVOJu (cf. also: Ingerl/Rohnke, MarkenG, 3rd edition 2010, Section 125g
MarkenG marginal Nos. 1 et seq. [beck-online]).

Art. 126(1a) EUTMR (cf. Art. 98(1a) CTMR old version) extends the reach of internationally
competent European Union trade mark courts and consequently their pronounced restraining
orders (cf. Art. 130(1) EUTMR [Art. 102(1) CTMR old version]) to all acts of infringement
committed or imminent in the European Union, irrespective of in which member state(s) such

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acts have been committed (cf. Eisenführ/Schennen, UMV, 5th edition 2017, Art. 98 EUTMR
marginal No. 2). Here the Plaintiff admissibly restricted the matter in dispute to the territory of
the European Union with the exception of France (cf. Eisenführ/Schennen, UMV, 5th edition
2017, Art. 98 EUTMR marginal No. 7).

II.

The decision-making authority of the regional court of Stuttgart is not undermined by the fact
that the Defendant, prior to service of the action, has filed - with petitions of 27 November 2013
and of 2 December 2013 - an application for a declaration of invalidity or cancellation (cf.
Exhibits K 6, B 1-B 4) with regard to the European Union colour mark No. EM010214195,
amongst others, on which the Plaintiff has mainly based its petitions, and a petition for
suspension of these proceedings with the pleading of 14 February 2014 (sheet 60 of the file,
volume II) within the meaning of Art. 132(1) EUTMR (cf. Art. 104(1) CTMR old version, which is
identical in content).

1. In accordance with Art. 132(1) EUTMR (cf. Art. 104(1) CTMR old version, which is
identical in content), a European Union trade mark court, unless there are special
reasons for the continuation of the proceedings, must suspend legal proceedings within
the meaning of Art. 124 EUTMR (cf. Art. 96 CTMR old version) of its own motion after
the parties have been heard or at a party’s motion after the other parties have been
heard if an application for revocation or for a declaration of invalidity has already been
filed at the office (OHIM).

2. Against the background of the usually to be expected long duration of proceedings

before the OHIM, the division in its discretion (“unless there are special reasons for
their continuation”, cf. Eisenführ/Schennen, UMV, 5th edition 2017, Art. 104 EUTMR
marginal No. 12) has decided not to suspend the proceedings (cf. the overview of
special reasons within the meaning of Art. 132 EUTMR [Art. 104 CTMR old version]:
Eisenführ/Schennen, UMV, 5th edition 2017, Art. 104 EUTMR marginal No. 13 with
further references).

3. The corresponding considerations applied to proceedings before the German Patent

and Trade Mark Office (GPTO) with reference to the national marks which the Plaintiff
only invokes in the alternative anyway.

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III.

Clause 1 of the relief sought, which is directed at ceasing and desisting, is sufficiently precise
in accordance with Section 253(2) No. 2 ZPO in conjunction with Art. 129(3) EUTMR (cf. [Art.]
101(3) CTMR old version), since it particularly refers to the concrete form of infringement, and
the Plaintiff has included the concrete designation “Pantone 677 C, 2010” following the words
“pink colour” for clarification purposes during the oral proceedings of 12 December 2017 (cf.
the minutes of the oral proceedings of 12 December 2017, sheet 374 of the file, volume V) in its
abstract preamble. In addition, the Plaintiff has stated the sequence of the assertion of its
disputed marks as well as the claims arising from the trade mark law and the UWG on pages
22 et seq. of the complaint of 11 December 2013 (sheets 14-17, sheets 22 et seq. of the file,
volume I).

B. Merits of the action

The admissible action is substantiated within the scope evident from the operative provisions
of the judgement.

I. Petition Clause 1: Ceasing and desisting

The Plaintiff has a claim against the Defendant for ceasing and desisting the use of the colour
pink (Pantone 677 C, 2010) for characterising hip joint implants from its European Union colour
mark No. EM010214195 pursuant to Art. 9(2a) EUTMR (cf. Art. 9(1a) CTMR old version, which
is identical in content) in conjunction with Art. 130(1) EUTMR (Art. 102(1) CTMR old version).

1. The applicable law emerges from Art. 129 EUTMR (cf. Art. 101 CTMR old version).
Accordingly, the European Union trade mark court basically applies the provisions of
the EUTMR, cf. Art. 129(1) EUTMR (cf. Art. 101(1) CTMR old version). In addition,
European Union trade mark courts apply their national law in all substantive and
procedural issues not covered by the EUTMR or differently regulated in the EUTMR, cf.
Art. 129(2), (3) EUTMR (cf. Art. 101(2),(3), Art. 102(2) CTMR old version). Where the
European Union trade mark court, as in this case, has EU-wide jurisdiction, the EUTMR
is the substantive legal basis for sanctions in all member states concerned on account
of the actions specified in Art. 126(1) EUTMR (cf. Art. 98(1) CTMR old version) (cf.
Eisenführ/Schennen, UMV, 5th edition 2017, Art. 98 EUTMR marginal No. 3).

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In this process, the provisions of the European Union trade mark regulations in the
version applicable since 1 October 2017 are to be applied to the future-oriented
injunctive relief. However, where the asserted injunction relief is based on the risk of
repetition, such relief only exists if the behaviour complained of was unlawful both at the
time when conducted and is unlawful at the point of time of the present decision (cf.
BGH [German Federal Supreme Court], judgement of 4 February 2016 - I ZR 194/14,
marginal No. 9 with further reference [juris] - Fressnapf).

Therefore, the EUTMR must be applied in the versions that were and/or are valid at the
point of time when the action of infringement has been committed which forms the basis
for the legal action and at the point of time of the present decision. The concrete
versions in this case are:

- at the point of time when the action of infringement has been committed
which forms the basis for the legal action, which in this case is the
presentation of the pink coloured hip joint implants at the SOFCOT from
11 November 2013 to 14 November 2013 on the Defendant’s part: the
European Union Trade Mark Regulation (in the judgement: CTMR old
version) in the version valid until 22 March 2016 (Council Regulation
(EC) No. 207/2009 of 26 February 2009 on the European Union trade
mark, Official Gazette No. L 78 page 1);

- at the point of time of the present decision, the European Union Trade
Mark Regulation (in the judgement: EUTMR) in the version valid since 1
October 2017 (Regulation [EU] 2017/1001 of the European Parliament
and of the Council of 14 June 2017 on the European Union trade mark,
Official Gazette No. L 154 page 1).

The articles relevant here have not been amended in terms of content since the CTMR
old version has come into force, neither in the version valid from 23 March 2016 to 30
September 2017 (Regulation [EU] 2015/2424 of the European Parliament and of the
Council of 16 December 2015, Official Gazette L 341/21) nor in the version valid since
1 October 2017, so that there are no amendments which may lead to a different legal
assessment.

2. The Plaintiff, as owner of the European Union colour mark No. EM010214195 (cf.
Exhibit K 6), has a right of action pursuant to Art. 5, Art. 9(1) EUTMR (cf. Art. 5, Art. 9(1)

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Sentence 1 CTMR old version).

3. The validity of a registered European Union trade mark is to be assumed in favour of

the Plaintiff in accordance with Art. 127(1) EUTMR (cf. Art. 99(1) CTMR old version,
which is identical in content). In accordance with Art. 127(1) EUTMR (cf. Art. 99(1)
CTMR old version), the European Union trade mark court seised on account of
infringement of a European Union trade mark must basically assume the validity of the
European Union trade mark in question unless contested by the Defendant with a
counterclaim for revocation or for a declaration of invalidity as specified by Art. 128
EUTMR (cf. Art. 100 CTMR old version).

In the present case, the Defendant has not filed a counterclaim, but has filed an
application for declaration of invalidity before the OHIM with regard to the European
Union colour mark No. EM010214195, amongst others, before the Plaintiff has filed its
legal action and thus has chosen the invalidity proceedings before the office. The
prerequisites of Art. 127(3) EUTMR (cf. Art. 99(3) CTMR old version) according to
which the objection of revocation for lack of genuine use of a mark within the meaning
of Art. 58(1a) EUTMR (cf. Art. 51(1a) CTMR old version) raised by the Defendant, and
previously pursuant to Art. 99(3) CTMR old version additionally the objection of
invalidity on relative grounds in accordance with Art. 8 CTMR old version, must be
taken into account by a European Union trade mark court even without a counterclaim,
are not given since the Defendant has not asserted such an objection. Thus, the
regional court of Stuttgart as the competent European Union trade mark court has been
deprived of examining the validity, it may not carry out an examination of its own motion
(cf. Eisenführ/Schennen, UMV, 5th edition 2017, Art. 99 EUTMR marginal No. 2). Thus,
the binding effect of a registration also and most of all extends to the circumstance that
there are no absolute reasons for invalidity or grounds of non-registrability within the
meaning of Art. 7 EUTMR (cf. Art. 7 CTMR old version), i.e. the registered sign in
particular has distinctiveness within the meaning of Art. 4, Art. 7(1b) EUTMR (cf. Art. 4,
Art. 7(1b) CTMR old version) and thus a function of indicating origin. Furthermore, it is
not a sign of a merely descriptive character within the meaning of Art. 7(1c) EUTMR (cf.
Art. 7(1c) CTMR old version), and also no case of exclusive technical necessity or
conditionality within the meaning of Art. 7(1e) ii) EUTMR (cf. Art. 7(1e) ii) CTMR old
version).

4. The Defendant exhibited and promoted hip joint implant prototypes in the colour pink
(Pantone 677 C, 2010) at the 2013 SOFCOT. This constitutes a case of double identity

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pursuant to Art. 9(2a) EUTMR (cf. Art. 9(1a) CTMR old version, which is identical in
content).

a. The double identity pursuant to Art. 9(2a) EUTMR (cf. Art. 9(1a) CTMR
old version, which is identical in content) emerges from the circumstance
that the Defendant has used in the course of trade and also intends to
use in the future a sign identical with the European Union trade mark No.
EM010214195, namely the colour pink (Pantone 677 C, 2010) for goods
which are identical to those for which the trade mark has been
registered, namely hip joint implants. The Defendant has submitted that
the hip joint implants exhibited at the 2013 SOFCOT followed the
exemplary embodiment of the expired patent and had a chromium oxide
content of approx. 0.3wt% (cf., amongst others,: pleadings of 2 July
2014, therein: page 2, sheet 116 of the file, volume III; of 29 July 2014,
therein: page 2, sheet 128 of the file, volume III; of 3 May 2017, therein:
Page 2 and 9, sheets 295 and 302 of the file, volume IV). Precisely this
chromium oxide content of approx. 0.3wt% effects the colour pink
(Pantone 677 C, 2010) which the Plaintiff, who insofar uses the same
chemical composition for the manufacture of its hip joint implants, has
had protected by a trade mark.

Where the Defendant argues in its pleading of 15 January 2018 (therein:

page 5) that it has not been proven at all that the alleged evidence of
infringement in the form of photographs of the prototypes presented at
the SOFCOT submitted as Set of Exhibits K 8 actually showed hip joint
implants in the colour “Pantone 677 C, 2010” at issue, then this is in
stark contrast to the Defendant’s previous submission which has been
the basis for taking evidence (cf. the decision of 19 August 2014, sheet
140 of the file, volume III; Defendant’s pleading of 12 September 2014,
therein: page 1, sheet 142 of the file, volume III). As stated above, the
Defendant has always submitted in this context that the prototypes
exhibited at the SOFCOT followed the exemplary embodiment of the
expired patent and in particular had a chromium oxide content of
approx. 0.3wt%. The Defendant even had to rely on this dosage, which
is also used by the Plaintiff, to meet the expectations of the public which
the Plaintiff has caused by relevant advertising for many years (cf. the
pleading of 3 May 2017, therein: page 2, paragraph 4, sheet 295 of the

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file, volume IV). However, based on the submissions of both parties in

accordance with the experts’ findings (cf. expert opinion of 30 August
2016, therein, amongst others, pages 4 and 42, sheet 242 of the file,
volume III), the chromium oxide content of approx. 0.3wt% precisely
results in the Plaintiff’s colour “Pantone 677 C, 2010". The expert
opinion is based on material samples specifically manufactured by the
Defendant for the taking of evidence, which, according to the
Defendant’s submission, should have exactly corresponded to the
chemical composition of the SOFCOT prototypes.

On the other hand, the contesting or in any case doubting of the colour
identity on the Defendant’s part is inadmissible and thus irrelevant
pursuant to Sections 138(1), (3) ZPO. Against the background that,
based on the above reproduced submission of the Defendant, the
identity of the pink colour of the prototypes with the Plaintiff’s colour
mark has been recognisably assumed throughout the whole
proceedings, and given the circumstance that the Defendant has not
made available anyone of the SOFCOT prototypes within the scope of
taking evidence, the lump sum denial of the colour identity cannot be
regarded as a sufficient submission of facts here. Therefore, no decision
had to be made regarding the question of a possible preclusion
pursuant to Sections 296 et seq. ZPO.

b. Furthermore, a case of infringing use within the meaning of Art. 9(2a)

EUTMR (cf. Art. 9(1a) CTMR old version, which is identical in content) is
given here due to the exhibition and advertising of the hip joint implants
in the colour pink (Pantone 677 C, 2010) at the SOFCOT.

aa. Prerequisite for this is that the use of the sign impairs or must
be able to impair the functions of the European Union trade mark
and in particular its essential function of guaranteeing to the
relevant public the origin of the goods or services. Thus, a use
opening the applicability of Art. 9 EUTMR (cf. Art. 9 CTMR old
version) is always given if the indication-of-origin function is
impaired, i.e. the sign used is perceived as a sign indicative of
the undertaking of origin (cf. Eisenführ/Schennen, UMV, 5th
edition 2017, Art. 9 EUTMR, marginal Nos. 31, 37).

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bb. Whether the use of a sign is perceived as a sign indicative of

the undertaking of origin by the public and therefore is used as a
trade mark depends on the perception of the relevant public (cf.
Ingerl/Rohnke, MarkenG, 3rd edition 2010, Section 14
MarkenG, marginal No. 138 [beck-online]). Such public is
composed primarily and insofar undisputed of prosthesis
manufacturers and, which is denied by the Defendant, but can
be convincingly taken from surveys submitted by the Plaintiff, at
least of prostheses implanting surgeons and orthopaedists
performing surgery.

cc. A trade mark use of the sign on the Defendant’s part is not
excluded in the present case merely because the colouring in
the colour pink (Pantone 677 C, 2010) is the production-related
(side) effect of a technically required chemical composition of
ceramic hip joint implants.

(1) In accordance with Art. 7(1e) ii) EUTMR (cf. Art. 7(1e) ii)
CTMR old version) the protectability of a sign and thus the
possibly corresponding use of this sign as a trade mark is
opposed if the sign in question exclusively exists of a form or
another characteristic feature of the goods, which is required to
achieve a technical effect (cf. regarding the significance of the tie
to the registration for the examination of a trade mark use:
Ingerl/Rohnke, MarkenG, 3rd edition 2010, Section 14 MarkenG
marginal No. 153). Such a technical necessity is missing in the
present case since the addition of chromium oxide, which in a
colour range from “light pink” to “ruby red” also causes the colour
“Pantone 677 C” protected by the Plaintiff by a trade mark, is
technically not required within the meaning of the regulation.

(2) The experts established in their opinion of 30 August 2016

convincingly and uncontested by the parties that a positive
influence of the chromium oxide content on the wear resistance
could be excluded and therefore the evidential question whether
the addition of chromium oxide to ZTA ceramics enhances the

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hardness and wear resistance of the ZTA ceramics is to be

answered with “NO” (cf. page 5 of the opinion of 30 August 2016,
sheet 242 of the file, volume III). However, what could be
established as a consequence of adding chromium oxide is a
pink-coloured colouration already beginning from a chromium
oxide content of 0.1wt%, and with increasing chromium oxide
content one can observe an increase of the red component, and
the test specimens showed the best match with the reference
specimen “Pantone 677 C” at a chromium oxide content ranging
from 0.3-0.5wt% in a visual colour comparison. (cf. page 4 of the
expert report of 30 August 2016, sheet 242 of the file, volume
III).

(3) Based on these statements made by the experts which have

not been contested by the parties, the addition of chromium
oxide has an effect on the colour, but not a positive effect on the
degree of hardness or the wear resistance of the ZTA ceramics.
Accordingly, the chromium oxide is neither a technically required
ingredient of the ceramic hip joint implants nor a technical
condition within the meaning of Art. 7(1e) ii) EUTMR (cf. Art.
7(1e) ii) CTMR old version) in order to achieve an enhancement
of the hardness and wear resistance of the ZTA ceramics.

(4) Contrary to the Defendant’s opinion, the circumstance that

the colour “Pantone 677 C, 2010” is effected by the addition of a
chemical substance, i.e. is based on a specific chemical
composition, is per se no case of a technical condition which
excludes the use of a trade mark within the meaning of Art. 7(1e)
ii) EUTMR (cf. Art. 7(1e) ii) CTMR old version). Also a mere
technical condition in differentiation to the technical necessity of
a feature requires a functional effect of any kind on the intended
use (cf. regarding differentiation and definition: BGH, judgement
of 15 December 2016 I ZR 197/15, marginal No. 25 [juris]). The
effect on the colour appearance alone does not suffice for this. In
addition, it is regularly inherent in a colour mark that the colour
claimed by such a mark can be attributed to a specific chemical
composition of the goods for which the mark is registered as a

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result of the addition of a colouring agent or of a substance

causing the colour.

It is not evident that the addition of the chromium oxide in the

dosage used by the Plaintiff which leads to the colour “Pantone
677 C, 2010” has any other effect on the ZTA ceramics than
obtaining the particular colour. Where the Defendant argues in
its pleading of 15 January 2018 (therein: page 14) that the expert
opinion of 30 August 2016 only deals with the effects of the
addition of chromium oxide on the hardness and wear resistance
of ZTA ceramics, but not with any further possible and originally
also allegedly advertised technical effects of the addition of
chromium oxide in the Plaintiff’s dosage on the part of the
Plaintiff (e.g. enhancement of the fracture toughness), the
Defendant cannot be heard with these words. The Defendant,
who by the way was the first to clearly differentiate between the
terms durability, hardness and wear resistance (cf. the pleading
of 22 April 2014, sheet 87 of the file, volume II), has only referred
to general advertising statements of the Plaintiff without claiming
itself in an active and substantiated manner that the chromium
oxide doping in question has otherwise positive effects of the
ZTA ceramics, hence is at least technically caused or even
necessary. The Defendant’s submission is therefore legally
irrelevant. The same applies, for the aforementioned reasons, to
the lump sum objection in the pleading of 4 December 2017
(therein: page 2, sheet 355 of the file, volume V) that the subject
matter of the expert examination in these proceedings has only
been a short inspection of the surface structure. Therefore,
irrespective thereof that the Defendant has not posed any
additional questions or raised any objections to the
completeness of the taking of evidence until now, also under the
aspect of the duration of the appraisal period, in particular within
the scope of its response to the expert opinion (cf. the pleading
of 24 October 2016, sheet 248 of the file, volume III), the
question of a possible preclusion of this submission can be left
open pursuant to Sections 296 et seq. ZPO.

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dd. Contrary to the Defendant’s opinion, a trade mark use is not

excluded here because the public perceives the colour pink (“Pantone
677 C, 2010") alone as an indication of the chemical composition of its
hip joint implants and the substance chromium oxide contained therein.
Rather, it must be assumed given the circumstances of this case that
the pink colouring of the Defendant’s hip joint implants is perceived by
quite a large portion of the public as an indication of a specific
manufacturer (the Plaintiff) or of a business relationship between the
Defendant and such manufacturer.

This perception of the public is based, on one hand, on the

circumstance that the Plaintiff has had a unique position among the
manufacturers of hip joint implants with the colour pink since the market
launch of its pink coloured hip joint implants in the year 2003. According
to its uncontested submission (cf. the pleading of 11 December 2013,
therein: page 8, sheet 8 of the file, volume I), the Plaintiff has
continuously marketed its hip joint implants in the colour pink since their
market launch in the year 2003. Until the Defendant’s actions in 2013
found fault with in this legal action, no pink coloured implants have
entered the market on the part of third parties. Even the Defendant itself
submits that the Plaintiff over the long time of its patent protection on the
market has - in the Defendant’s point of view unlawfully - acquired and
held a monopoly position on the market which the Plaintiff now wants to
perpetuate by - in the Defendant’s point of view inadmissibly - invoking
the renown achieved as a result of the monopoly position by way of the
(colour) mark registration.

The Defendant’s objection that this renown and unique position

acquired during the term of the erroneously granted patent must remain
unconsidered within the scope of the question of distinctiveness and
trade mark use of the sign as the renown has been achieved unlawfully,
cannot be considered in the present proceedings. For it is an objection
which aims at the effective acquisition of distinctiveness of the sign at
issue which is required for the registrability of a trade mark within the
meaning of Art. 4, 7(1b) EUTMR (cf. Art. 4, 7(1b) CTMR old version).
However, based on Art. 127(1) EUTMR (cf. Art. 99(1) CTMR old
version) the European Union trade mark court must assume validity and

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protectability of the registered trade mark, so that in this case

distinctiveness and a function of indicating the origin of the sign at issue
to the public must be assumed, even if this circumstance is to be
attributed every now and then to the unique position and renown
acquired as a result of the patent protection.

This unique position in conjunction with the Plaintiff’s high market share
and the numerous documents submitted by the Plaintiff regarding
consumer surveys, marketing strategies and the market environment
show, even when taking into account the Defendant’s objections to the
materials presented by the Plaintiff, that in any case a significant portion
of the relevant public perceives the colour pink (“Pantone 677 C, 2010")
also as a commercial indication of the Plaintiff or in any case of a
specific manufacturer and consequently links pink hip joint implants as
those manufactured by the Defendant to the Plaintiff’s company or in
any case to a specific manufacturer on the market. This is at the same
time confirmed by the fact that also other competitors (e.g. Kyocera)
offer their hip joint implants in different colours on the market. Contrary
to the Defendant’s opinion, it can indeed be taken from this situation in
the market environment that the colour of a hip joint implant product is
used in the competition also for the purpose of identification and
differentiation and that the colour of the implant is accordingly perceived
by the relevant public as an indication of origin as well.

ee. Based on these statements, it does impair the indication-of-origin

function of the European Union trade mark No. EM010214195 at issue if
also the Defendant mixes its hip joint implants with a chromium oxide
content of approx. 0.3wt% and these also gain the colour pink (Pantone
677 C, 2010) thereby.

c. A trade mark law infringing use within the meaning of Art. 9(2a) EUTMR
(cf. Art. 9(1a) CTMR old version, which is identical in content) must be
answered in the affirmative all the more when the Defendant does not
produce its hip joint implants at all by adding chromium oxide, but merely
wants to colour them pink subsequently as the Plaintiff has insinuated
with reference to the SOFCOT prototypes as they were not submitted in
these proceedings. Against this background it is no longer relevant

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whether the Defendant can be regarded as having committed another

act of infringement due to the article about the Defendant publicly
accessible on "www.devicemed.fr” which was submitted by the Plaintiff
on 11 December 2013 (cf. Exhibit K 11) and which undisputedly
contained an image of a hip joint implant which had been subsequently
coloured pink by means of graphical editing.

d. The Plaintiff furthermore is not barred from asserting its European Union
colour mark No. EM010214195 pursuant to Art. 14(1b) EUTMR (cf. Art.
12(1b) CTMR old version), Section 4(4) UWG or Section 242 BGB.

aa. The Defendant’s objection that the aforementioned European Union

colour mark No. EM010214195 (“Pink - Pantone 677 C, 2010") is a “sign
without distinctiveness” within the meaning of Art. 14(1b) Alternative 1
EUTMR cannot be considered in the concrete case as the European
Union trade mark court must assume the validity of the registered mark
as specified by Art. 127(1) EUTMR.

bb. Also the objection of descriptive use pursuant to Art. 14(1b)

Alternative 2 EUTMR (cf. Art. 12b CTMR old version) raised by the
Defendant is not successful. In this connection, the Defendant is of the
opinion that the pink colouring of its hip joint implants are a descriptive
indication within the meaning of Art. 14(1b) Alternative 2 EUTMR (cf. Art.
12b CTMR old version) of the circumstance that its ZTA ceramics
contained chromium oxide. This descriptive term enables the public to
have an understanding of the nature of the ZTA ceramics.

Irrespective thereof whether the pink colour can be categorised as a

descriptive term within the meaning of Art. 14(1b) Alternative 2 EUTMR
(cf. Art. 12b CTMR old version) at all, the Defendant’s objection is not
sustainable for other reasons. The applicability of Art. 14(1b) Alternative
2 EUTMR (cf. Art. 12b CTMR old version) protecting the use of
descriptive terms is basically opened when, as in this case, an origin
indicating use of such terms within the meaning of Art. 9 EUTMR (cf. Art.
9 CTMR old version) has already been answered in the affirmative (cf.
ECJ judgement of 7 January 2004 - C 100/02, marginal No. 15
[beck-online] - Gerolsteiner/Putsch). However, in the present case the

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Defendant’s objection is at any rate opposed by the integrity barrier of

Art. 14(2) EUTMR (cf. Art. 12 at the end CTMR old version). Accordingly,
a use within the meaning of Art. 14(1) EUTMR (cf. Art. 12a-c CTMR old
version) must correspond to honest practices in industrial or commercial
matters. Here an overall consideration of all submitted and otherwise
evident circumstances must be conducted (cf. Ingerl/Rohnke, MarkenG,
3rd edition 2010, Section 23 MarkenG marginal No. 56 [beck-online]).

In this specific case such an overall consideration leads to the result that
the Defendant violates the integrity barrier of Art. 14(2) EUTMR (cf. Art.
12 at the end CTMR old version). This is apparent from the following:

As has been established, the pink colour is understood by a not

insignificant portion of the public precisely not as an indication of the
chemical composition with chromium oxide alone, but has also assigned
an allocation and indication-of-origin function to the sign “Pink - Pantone
677 C, 2010”. According to its own submission, the Defendant adds a
chromium oxide content of approx. 0.3wt% to the ZTA ceramics during
the manufacture of its hip joint implants. Thus, the Defendant uses the
same dosage as the Plaintiff. As a consequence, the Defendant’s hip
joint implants also have the colour “Pink - Pantone 677 C, 2010”.
However, as can be taken from the findings in the expert opinion of 30
August 2016, the Defendant is not forced at all for technical reasons to
add chromium oxide to its ZTA ceramics. Especially there is no need for
the Defendant to select the identical dosage of chromium oxide for its
products as the Plaintiff uses for its ZTA ceramics. Thus, an
approximation to the Plaintiff’s products takes place without any
necessity. Against the background that a not insignificant part of the
relevant public associates the colour pink with the origin of the hip joint
implants from the Plaintiff’s company or in any case from a specific
manufacturer, unnecessary, but for the Defendant reasonably avoidable
market confusion and likelihood of confusion are provoked in this
manner which let the use of the sign at issue appear as unfair within the
meaning of Art. 14(2) EUTMR (cf. Art. 12 at the end CTMR old version).

At the same time, it must here be taken into account that the European
Union colour mark No. EM010214195 (“Pink - Pantone 677 C, 2010")

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does not have the effect either that the remaining competitors, amongst
them, the Defendant, would be completely excluded from using
chromium oxide for their ZTA ceramics. The Defendant itself submits
that the addition of chromium oxide with a proportion ranging from 0.01
to 1.41wt% effects a colour range from light pink to ruby red in
accordance with the specifications of the expired patent. With its trade
mark the Plaintiff only claims the colour “Pantone 677 C, 2010” for itself.

In this connection the Defendant raises the objection that it must be

allowed to add the chromium oxide exactly in the Plaintiff’s dosage since
the Plaintiff, by means of the unlawfully obtained patent and its relevant
advertising, has caused the mistaken expectations in the relevant public
that ZTA ceramics required the addition of chromium oxide and ideally in
the Plaintiff’s dosage for a specific hardness and wear resistance. The
Plaintiff may not further monopolise this chemical composition of ZTA
ceramics, which the public expects due to the Plaintiff’s misleading
advertising for many years, via (colour) mark registrations to the
exclusion of the remaining competitors.

This objection raised by the Defendant cannot be taken into

consideration here. For it is directed, not least under the aspect of an
allegedly existing requirement of availability of a descriptive term within
the meaning of Art. 7(1c) [EUTMR] (cf. Art. 7(1c) CTMR old version), at
the validity of the mark which the European Union trade mark court has
to assume on account of the binding effect of the registration pursuant to
Art. 127(1) EUTMR (cf. Art. 99(1) CTMR old version).

cc. Also the objections raised by the Defendant under the aspects of
purposeful restraint of competitors pursuant to Section 4(4) UWG (cf.
Art. 4(10) UWG old version) and of good faith pursuant to Section 242
BGB remain unsuccessful. Therefore, the question how these national
law objections would be consistent with EU law if successful can be left
open.

(1) The Defendant first of all argues that the Plaintiff’s trade marks are
ready for cancellation on account of absolute grounds of
non-registrability or grounds for invalidity, amongst others, on account of

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the alleged lack of distinctiveness and on account of the character of the

colour pink (Pantone 677 C, 2010) as a product-related feature or in any
case as a descriptive term of which the availability has to be allegedly
preserved on the market for hip joint implants, and therefore the Plaintiff
demands something from the Defendant which the Plaintiff, as a result of
- in the Defendant’s point of view - the successful applications for
cancellation or nullity, would have to take back promptly again.

The so-called “dolo agit” defence does not apply in this case since it is
directed against the validity of the trade mark under the aforementioned
aspects, but the European Union trade mark court, as has been put forth
above, must assume the protectability of the trade mark in accordance
with Art. 127(1) EUTMR (cf. Art. 99(1) CTMR old version).

(2) The latter also applies to the objection of the alleged unlawful
because contradictory behaviour.

The Defendant in this case accuses the Plaintiff of contradictory

behaviour as it has deceived the public of the significance of the addition
of chromium oxide during the term of the patent and now no longer
wants to know anything about its original, widely spread assertions in
order to justify its mark registrations. Due to the misleading advertising
on the Plaintiff’s part for many years and due to the - meanwhile expired
- patent, the pink colour is not deemed to be an indication of origin in
relation to the Plaintiff, but merely or in any case primarily as a sign of
the ball heads’ characteristics.

Irrespective thereof that this argument does not take into account the
circumstance that the Plaintiff, according to its own submission, initially
assumed itself a technically caused positive effect of the chromium
oxide on the stability of the ZTA ceramics based on the prior art back
then, this objection of “venire contra factum proprium” cannot be taken
into account. For said objection is also directed against the validity of the
trade mark(s) at issue under the aspects of lack of distinctiveness and of
the character of the colour pink (Pantone 677 C, 2010) as a descriptive
term of which the availability has to be preserved as claimed by the
Defendant, which the European Union trade mark court, however, has to

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assume on account of the binding effect of the registration pursuant to

Art. 127(1) EUTMR (cf. Art. 99(1) CTMR old version).

(3) For the same reasons, the Defendant also cannot be successful with
its objections of unlawful acquisition and abuse of a formal legal position.

The Defendant complains that the Plaintiff, as a result of the - in the

Defendant’s opinion - unlawfully obtained patent protection for many
years to the exclusion of the remaining competitors, has obtained an
unlawful monopoly position which it now wants to inadmissibly
perpetuate in terms of time after the expiry of the property rights using
the "detour" of trade mark law or competition law.

Also this objection is - under the aforementioned aspects - an attack on

the validity of the trade marks.

The legal nature of the objections raised by the Defendant within the
scope of Section 242 BGB as attacks on the validity of the trade marks
also becomes visible in that they are no specific objections in the
relations between the parties (“inter partes”), but - as absolute grounds
of non-registrability within the meaning of Art. 7 EUTMR (cf. Art. 7 CTMR
old version) - could have been asserted by any competitor and therefore
are left to a counterclaim (which has not been filed in this case) or to
cancellation or nullity proceedings before the office (which has been
chosen in this case).

(4) A concrete improper anti-competitive behaviour of the Plaintiff,

especially towards the Defendant, within the meaning of Section 4(4)
UWG (cf. Art. 4(10) UWG old version) or Section 242 BGB has neither
been demonstrated by the Defendant nor has been recognisable as
such. Contrary to the case decided by the BGH with the judgement of 19
February 1998 (case No. I ZR 138/95, juris - Makalu), the Plaintiff does
especially not interfere with a valuable right (“wertvoller Besitzstand”) of
the Defendant when pursuing its trade mark rights. Furthermore, it must
be taken into account that the scope of protection of the Plaintiff’s colour
mark is narrow if not restricted to a precise colour. As already put forth
under Clause B. I. 4. d. bb., the Defendant is against this background not

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17 O 1790/13

barred from manufacturing and distributing hip joint implants with a

colour caused by the addition of chromium oxide, however, such colour
may not be identical with the colour “Pantone 677 C, 2010”. Within the
considered scope, the statements made under Clause B. 1.4. d. bb.
apply additionally.

e. Where the hip joint implants presented at the SOFCOT had already
been produced by adding chromium oxide, or even in the case that they
had been coloured pink subsequently, a trade mark law infringing and a
risk of repetition indicating first offence was committed in France. In
addition, the Defendant had exhibited and promoted the hip joint implant
products at issue at the MEDTEC trade fair in Stuttgart in March 2013.
This submission of the Plaintiff which refers to the Defendant’s
statements in is pre-trial letter of 27 November 2013 (cf. Exhibit K 9) has
remained unchallenged on the Defendant’s part. Irrespective thereof,
similar acts of infringement within the meaning of Art. 9(3) EUTMR (cf.
Art. 9(2) CTMR old version) beyond the borders of France into other EU
member states including Germany are at any rate imminent due to the
internationalised market.

Should the hip joint implants exhibited and promoted at trade fairs,
especially at the SOFCOT, actually have not (yet) contained chromium
oxide, then there is a risk of first infringement also in this case due to the
Plaintiff’s intent to use chromium oxide in the Plaintiff’s dosage in the
future, as has become very clear in the course of these proceedings.

Irrespective of the contradictory nature of the Defendant’s submission in

this regard in the pleading of 15 January 2018 (cf. the statements made
under Clause B 1.4.

a.) the injunctive relief would also be justified under the aspect of the risk
of first infringement even if the hip joint implants exhibited and promoted
at the SOFCOT should actually not have had the same colour as the
Plaintiff’s colour mark “Pantone 677 C, 2010”. For the Defendant has
expressed beyond doubt in the course of the proceedings that it intends
in any case to produce and sell hip joint implants in the Plaintiff’s
colouring caused by a chromium oxide doping of approx. 0.3wt%. This

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cannot least be obtained from the Defendant’s repeated submission that

the Plaintiff’s chromium oxide dosage according to the exemplary
embodiment of the expired patent is after all required to meet the
public’s expectations raised by the Plaintiff (cf., amongst others, the
Defendant’s pleading of 3 May 2017, therein pages 2 and 9, sheets 295
and 302 of the file, volume IV).

Thus, there is at the same time no uncertainty as to the question whether

and in which concrete design the Defendant would like to place hip joint
implants on the market (cf. BGH, judgement of 23 October 2014 - I ZR
133/13, marginal No. 22 [juris] - Keksstangen [biscuit sticks]). In
addition, the Defendant has already exhibited its prototypes at the
SOFCOT congress and at the MEDTEC trade fair in Stuttgart to the
relevant public (cf. in contrast hereto: BGH, judgement of 23 October
2014 I ZR 133/13, marginal No. 22 [juris] - Keksstangen). Even if such a
presentation of the prototypes at issue at two trade fairs - in this case in
France and in Germany - should not qualify as committed acts of use
within the meaning of Art. 9(3a,b,e) EUTMR (cf. Art. 9(2a,b,d) CTMR old
version), there is - against this background and based on the
Defendant’s submission with regard to the EU member states in dispute
- in any case a risk of committing these acts of use for the first time in the
form of advertising, offering, selling and putting into circulation.

The Defendant has not signed a cease and desist declaration with
penalty clause.

II. Petitions Clauses 2, 3, 4 and 6: information and accounting, destruction, recall and
determination of the liability to payment of compensation

In addition, the Plaintiff has, with regard to the territory of the Federal Republic of Germany,
asserted claims against the Defendant for information and accounting, destruction, recall and
determination of the liability to payment of compensation with the relief sought in the petitions
Clauses 2, 3, 4 and 6.

The regulations relevant here have not been amended in terms of content since the CTMR old
version has come into force, neither in the version valid from 23 March 2016 to 30 September
2017 nor in the version valid since 1 October 2017, so that there are no amendments which

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may lead to a different result.

1. The claim for information about the distribution channel, stating, in particular, the
buyers and points of sales, the price for the goods, and the scope of the goods
delivered and the turnover generated together with the corresponding accounting
emerges from Art. 129(2) EUTMR (cf. Art. 102(2) CTMR old version); regarding the
effects of the omission of Art. 102(2) CTMR old version: Eisenführ/Schennen, UMV, 5th
edition 2017, Art. 102 EUTMR marginal Nos. 2 and 9) in conjunction with Section 19
MarkenG in conjunction with Sections 259, 242 BGB. The claim has not expired on
account of fulfilment pursuant to Section 362(1) BGB either.

Although the Defendant has stated within the scope of its pleadings of 22 April 2014
(therein: page 7, sheets 87 et seq., 93 of the file, volume II), of 23 June 2014 (therein:
page 2, sheets 112 et seq., 113 of the file, volume III), and of 2 July 2014 (therein:
pages 1 et seq., sheets 115 et seq. of the file, volume III) that the hip joint implants
exhibited and promoted at the 2013 trade fair in Paris, which are the reason for this
legal action and, according to the Plaintiff’s submission, have been mixed with a
chromium oxide content, are prototypes, the Defendant refrains from submitting the
prototypes exhibited at the SOFCOT, since these are the subject matter of the
inspection proceedings (saisie-contrefacon, Exhibit K 8) initiated by the Plaintiff in
France and of the corresponding proceedings on the merits commenced in the
meantime in France by the Plaintiff. Such implants have not been manufactured by the
Defendant either beforehand or thereafter and also have not been distributed, but have
only been promoted at trade fairs - at least probably at the 2013 SOFCOT and at the
2013 MEDTEC - and on its website. Due to the ongoing legal dispute, the Defendant
has slowed down its research programme. The Defendant will wait for the court’s
decision before implants would be manufactured in series based on the patent expired.

However, these statements are no fulfilment of the Plaintiff’s claim for information within
the meaning of Section 362(1) BGB. For these are declarations which in the
proceedings were not made for the purpose of providing information, but under other
legal aspects, in this case in connection with obtaining an expert opinion and the
submission of one of the workpieces promoted at the SOFCOT trade fair in Paris in
November 2013 as ordered under Clause III of the order to take evidence of 27 May
2014 (cf. sheet 109 of the file, volume II). Such declarations which in the proceedings
are not given for the purpose of providing information, but, as is the case in this case,
under other legal aspects, are not to be regarded as the provision of information owed

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(cf. judgement of 21 January 1999 - I ZR 135/96, marginal No. 35 with further reference
[juris] - Datenbankabgleich [database matching]).

2. Against this background, the Plaintiff is also entitled to the claims asserted with the
relief sought in the petitions Clauses 2, 3, 4 and 6 for recall and removal of any of the
Defendant’s hip joint implants in the colour pink (Pantone 677 C, 2010) from the
distribution channels pursuant to Art. 129(2), Art. 130(2) EUTMR (cf. Art. 102(2) CTMR
old version) in conjunction with Section 18(2) MarkenG as well as their destruction and
the corresponding presentation of evidence thereof in accordance with Art. 129(2), Art.
130(2) EUTMR (cf. Art. 102(2) CTMR old version) in conjunction with Section 18(1)
MarkenG in conjunction with Section 242 BGB.

3. Furthermore, the Plaintiff has a claim for determination of the liability to payment of
compensation on the part of the Defendant asserted with the relief sought in the petition
Clause 6 in accordance with Art. 129(2) EUTMR (cf. Art. 102(2) CTMR old version) in
conjunction with Section 14(6) MarkenG. The relief sought in the petition Clause 6 is
admissible and also substantiated pursuant to Section 256 ZPO, Art. 129(3) EUTMR
(cf. Art. 101(3) CTMR old version). The positive declaratory relief is substantiated when
the factual and legal prerequisites of the asserted claim are given. If the infringement of
an absolutely protected legal interest has been established and if only the occurrence
of a loss is insecure, it is sufficient if the established infringement may lead to losses in
the future. This is the case here, as the not remote possibility exists that the Plaintiff has
incurred or will incur a loss due to the trade law infringing advertisement of the
prototypes at the SOFCOT as established under Clause B. I. due to an impairment of
its unique position or market confusion, also outside of France (cf. regarding the
substantive conditions of a positive declaratory relief: Beck'scher Online-Kommentar,
ZPO, 27th edition 2017, Section 256 ZPO marginal No. 34 with further reference
[beck-online]). The Defendant also acted at least negligently within the meaning of
Section 276(2) BGB.

4. However, the Plaintiff is only entitled to the claims asserted with the relief sought in the
petitions Clauses 2, 3, 4 and 6 with regard to the territory of the Federal Republic of
Germany. This first of all follows from the fact that all subsequent claims derived from
the restraining order of Art. 130(1) EUTMR (cf. Art. 102(1) CTMR old version), namely
for damages, information, destruction or recall, are governed by the respective legal
systems of the member states concerned (including their international private law)
pursuant to Art. 129(2), Art. 130(2) EUTMR (cf. Art. 102(2) CTMR old version; for the

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respective classification: Eisenführ/Schennen, UMV, 5th edition 2017, Art. 102 EUTMR
marginal Nos. 9 and 15) which must be applied by the seised European Union trade
mark court, which in this case has EU-wide jurisdiction pursuant to Art. 126(1a) EUTMR
(cf. Art. 98(1a) CTMR old version) (cf. Eisenführ/Schennen, UMV, 5th edition 2017, Art.
98 EUTMR marginal No. 4). Where the relief sought in the petitions Clauses 2, 3, 4 and
6 with reference to the relief sought in the petition Clause 1 relates, beyond Germany,
to all other EU member states with the exception of France, the applicable law
accordingly emerges from Art. 8(2) ROM-II-VO [Rome II Regulation] (cf. also
Eisenführ/Schennen, UMV, 5th edition 2017, Art. 101 EUTMR marginal No. 10, Art.
102 EUTMR marginal No. 15; Münchener Kommentar, BGB, 7th edition 2018, Art. 3
ROM-II-VO marginal Nos. 2 et seq. [beck-online]). Art. 8(2) ROM-II-VO is tied to the
substantive law of the member state in which the action of infringement has been
committed or is imminent (cf. Eisenführ/Schennen, UMV, 5th edition 2017, Art. 101
marginal No. 10). This means the lex loci contractus (“Handlungsortsrecht”) (cf.
Beck'scher Online-Kommentar, ROM-II-VO, 43rd edition 2017, Art. 8 ROM-II-VO
marginal No. 5 [beck-online]), so that sanctions are each based on the national law of
the countries of use. Accordingly, petitions for subsequent claims (information,
damages, etc.) with regard to committed or imminent acts of infringement in other
member states are not necessarily substantiated, but must basically take into account
national sanction systems, stating their prerequisites (cf. Knaak, GRUR 2001, 21 (28)
[beck-online]). Against this background, the Plaintiff’s submission, which within the
scope of the claims for information and accounting, destruction, recall and
determination of the liability to payment of compensation only referred to national
provisions of the German trade mark law, does not meet the requirements to present
the facts of the case, so that the claims asserted with the relief sought in the petitions
Clauses 2, 3, 4 and 6 had to be restricted to the territory of the Federal Republic of
Germany.

III. Petition Clause 5: Pre-trial legal fees

The Plaintiff has a claim for payment of pre-trial warning notice costs against the Defendant,
however, only in the amount of €4,299.50 plus interest in respect of pending proceedings in the
amount of 5% points above the particular basic interest rate from 3 January 2014 pursuant to
Art. 129(2) EUTMR (cf. Art. 101(2), 102(2) CTMR old version) in conjunction with Section 14(6)
MarkenG, Sections 670, 677, 683 BGB; insofar the relief sought in the petition Clause 5 had to
be dismissed in other respects.

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17 O 1790/13

1. As set forth under B. I., the Plaintiff has an EU-wide injunctive relief against the
Defendant on account of the trade mark infringing use of the mark “colour pink,
Pantone 677 C, 2010” registered in the Plaintiff’s favour. Thus, the Plaintiff has
legitimately warned the Defendant. The fact that the Plaintiff, as the Defendant
complained about during the pre-trial phase, has not explicitly incorporated a restriction
to the territory of the European Union in the agreement to cease and desist requested
in conjunction with the warning, does not result in the warning being too broadly defined
and insofar being partly unjustified. For the interpretation of the warning based on
European and German trade marks only implies that the requested cease-and-desist
declaration should only extend to the geographical territory covered by the trade marks.

2. The warning costs in the amount of €4,299.50 are calculated on the basis of a value of
the matter for the injunctive relief in the amount of €400,000 and an administration fee
at a factor of 1.5 plus a lump sum fee of €20 in accordance with Nos. 2300, 7002 VV
RVG [List of Applicable Fees of the German Attorney Remuneration Act]. With its
warning letter of 20 November 2013 (Exhibit K 9), the Plaintiff only asserted the
injunctive relief and no subsequent claims. Where the Plaintiff has taken into account a
value of the matter of €500,000 for the injunctive relief alone, it has measured its
interest in cease and desist, information, destruction, recall and determination of the
liability to payment of compensation in these proceedings at a total of €500,000. In the
court’s point of view, a value of the matter in the amount of €400,000 for cease and
desist, taking into account the significance and scope of the matter as well as the
parties’ business size, appears to be appropriate. Similarly, the legal and actual level of
difficulty and the scope of the matter justify the slight increase in fees by 0.2 to a fee at
a factor of 1.5. In addition, the Defendant has not objected to the claim for refund of the
warning costs as such.

3. The claim for interest asserted with the legal action served on 2 January 2014 is based
on Sections 291, 288(1) Sentence 2 BGB in conjunction with Section 187(1) BGB
analogous.

IV.

As stated under Clauses B. I. to III., the claims asserted by the Plaintiff for cease and desist,
information and accounting, recall, destruction, determination of the liability to payment of
compensation, and refund of pre-trial legal costs already result from an infringement of the
European Union colour mark No. EM010214195 which the Plaintiff primarily invokes within the

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17 O 1790/13

scope that can be taken from the operative provisions of this judgement, so that insofar no
decision had to be taken anymore on the claims asserted in the alternative from the Plaintiff’s
other marks and from the UWG. Where the relief sought in the petitions Clauses 2. to 6. has
been partially dismissed on account of limitation of the claims to the territory of the Federal
Republic of Germany or on account of the lower value of the matter, no further claims on the
part of the Plaintiff emerge from the remaining trade marks asserted in the alternative and from
the UWG with the same reasoning.

C. Ancillary decisions

I.

The threat of fines and detention emerges from Section 890 ZPO in conjunction with Art.
130(1) Sentence 2 EUTMR (cf. Art. 102(1) Sentence 2 CTMR old version). The territorial range
of the fine or detention (cf. Eisenführ/Schennen, UMV, 5th edition 2017, Art. 102 EUTMR
marginal No. 8) is based on the regulation of Art. 126(1a) EUTMR (cf. Art. 98(1a) CTMR old
version).

II.

The decision as to costs is based on Section 92(2) No. 1 ZPO, Art. 129(3) EUTMR (cf. Art.
101(3) CTMR old version).

III.

The dictum on the provisional enforceability is based on Section 709 Sentences 1, 2 ZPO, Art.
129(3) EUTMR (cf. Art. 101(3) CTMR old version).

IV.

The assessment of the value in dispute emerges from Section 51(1) GKG [German Court Fees
Act].

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17 O 1790/13

Instructions as to available legal remedies:

An appeal can be lodged against the decision with which the amount in dispute has been
determined, if the value of the subject of appeal exceeds EUR 200, or the court has admitted
the appeal.

The appeal must be filed with the

Regional Court of Stuttgart

Urbanstrasse 20
70182 Stuttgart,

within six months.

The period of time begins upon legal validity of the decision in the main case or any other
settlement of the procedure. If the amount in dispute has been determined later than one
month prior to the expiry of the six months’ period, the appeal can be lodged within one month
after delivery or formless communication of the decision on the amount in dispute determined.
In the case of formless communication, the decision is deemed to have been made known on
the third day after posting.

The appeal must be filed in written form, or in the form of a declaration recorded at the
aforementioned court’s office. It can also be lodged in the form of a declaration recorded at the
office of any local court; however, the period of time is only complied with if the declaration
reaches the aforementioned court in time. Assistance on the part of a lawyer is not prescribed.

/Illegible signature/ /Illegible signature/ /Illegible signature/

Rzymann Helms Gleiter
Presiding judge Judge
at the regional court at the regional court Judge

Pronounced on 30 January 2018

/Illegible signature/
Clerk of the court

/Round stamp mark:/ /Stamp mark:/

REGIONAL COURT OF Executed - Certified
STUTTGART Stuttgart, /date stamp mark:/ 30 Jan. 18
/Coat of arms of the German Clerk of the
Land of Baden-Württemberg/ regional court
/Illegible signature/

Add. 67
"In
"In my
my capacity
capacity of
of aatranslator
translator for
for the
theEnglish
English language,
language, duly
duly registered
registered and
and
commissioned
commissioned by by and
and sworn
sworn to the
the President
President of the Landgericht
Landgericht Munchen
München II [Munich
11[Munich
II
11Regional Court], II do
Regional Court], do hereby
hereby certify that the
certify that the foregoing
foregoing is,
is, to
to the
the best
best of
of my
my
knowledge and belief,
knowledge and belief, a true
true and
and accurate
accurate translation
translation of a document
document prepared
prepared in the
the
German
German language, whereof a copy
language, whereof copy has been
been submitted
submitled to me".
me".

IN WITNESS
WITNESS WHEREOF
WHEREOF I have
have hereunder
hereunder set my hand
hand and seal
seal at Poing,
Poing, Germany,
Germany,
this
this 7th day of February 2018.
February 2018.

JV\Cjvrt\o( J1~
Ingrid
Ingrid ~cklckl

Add. 68
 CERTIFICATE OF SERVICE

I hereby certify that I electronically filed the foregoing with the Clerk of the

Court for the United States Court of Appeals for the Tenth Circuit by using the

Court’s CM/ECF system on February 9, 2018. I certify that all participants in the

case are registered CM/ECF users and that service will be accomplished by the

CM/ECF system.

/s/ Jessica L. Ellsworth

Jessica L. Ellsworth

Counsel for Appellant CeramTec GmbH