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Michaels Defeats Paint Kit Maker’s Trademark Suit at Trial

Jun 6, 2024
Bloomberg Law

Craft supply giant The Michaels Cos. Inc. at trial beat a paint-by-numbers kit designer’s allegations it infringed the “Masterpiece by Numbers” trademark by selling similarly named sets after a deal between them fell through.

A jury for the US District Court for the Northern District of Texas determined Thursday Michaels and its units Michaels Stores Inc. and Artistree Inc. did not cause customers to believe its Artist’s Loft Masterpiece Paint by Numbers kits were the same as products sold under the trademark owned by ATC Media LLC, which does business as Masterpiece by Numbers.

Chief Judge David Godbey did not read the verdict out loud in the courtroom, but informed the parties’ attorneys of the jury’s decision in a conference room. Attorneys for Masterpiece confirmed the verdict with Bloomberg Law.

“I expect this to be in the media, but it probably will not,” Godbey told the courtroom before dismissing the jury.

Masterpiece contacted Michaels in July 2020 about a possible business relationship concerning frame referrals for paint-by-numbers customers, Scott Harper of Harper & Bates LLP, counsel for the kit designer, told the jury. Harper said the small business met with Michaels and sent the retailer its products after a November 2020 meeting but the deal later fell apart.

Michaels began selling its own paint-by-number kits in November 2021and made over $3 million in profits, Harper said.

“They made the conscious willful decision,” Harper said.

Masterpiece filed a lawsuit against Michaels in June 2022, alleging trademark infringement and misappropriation of trade secrets. The trade secret allegation was not a part of the jury’s deliberations, the companies said during closing arguments.

Jamil N. Alibhai of Munsch Hardt Kopf & Harr PC, counsel for Michaels, told the jury the company and its units did not infringe Masterpiece’s trademark or harm the small business’ revenue. Michaels has sold products under the trademarked store brand name “Artist’s Loft” since 2011, he said.

“Masterpiece” is a common word used in society, Alibhai said, giving the example of him calling his son’s artwork a “masterpiece” even if its not of the same quality of a Vincent Van Gough.

Harper told the jury both companies advertise their similar paint-by-numbers products online, but Alibhai argued Michaels sold over 97% of its kits in the stores.

Michaels denied Maseterpiece’s claims the similarity of the paint kits and their names was confusing to customers with the similar paint kits, though Masterpiece said a customer contacted it out of confusion.

“Does it look to you like America was confused with these products because of one email?” Alibhai asked the jury, noting the small business did not conduct a customer survey to back up their allegation.

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