## Facts

- Munters sold dehumidifying apparatus and owned a federal trademark registration for “HONEYCOMBE” used on space dehumidifying equipment featuring a honeycomb-shaped desiccant wheel rotor.
- Matsui sold dehumidifiers for drying plastic resins and marketed a “Honeycomb Dehumidifying Unit” that also used a honeycomb-shaped desiccant wheel rotor.
- After Munters objected, Matsui stopped using “Honeycomb” as a trademark in advertising but continued using “honeycomb” as an adjective describing the rotor.
- Munters sued under the Lanham Act for trademark infringement and unfair competition, alleging Matsui’s use created a likelihood of confusion with Munters’ “HONEYCOMBE” mark.
- The district court initially entered a preliminary injunction but, after an evidentiary hearing, denied a permanent injunction, finding no likelihood of confusion from Matsui’s descriptive use.
- The district court also refused to allow Matsui to amend its counterclaim to assert that “HONEYCOMBE” was generic.

## Issues

1. Whether Matsui’s descriptive use of “honeycomb” in connection with its dehumidifiers was likely to cause confusion with Munters’ registered “HONEYCOMBE” mark, warranting a permanent injunction.
2. Whether considering the mark’s descriptiveness and strength in the likelihood-of-confusion analysis improperly undermined the mark’s incontestable status under the Lanham Act.
3. Whether the district court erred in denying Matsui leave to amend its counterclaim to challenge the “HONEYCOMBE” registration as generic.

## Decision

- The Seventh Circuit affirmed the denial of a permanent injunction, holding the district court’s no-confusion finding was not clearly erroneous.
- The court held it was proper to consider the strength/descriptiveness of “HONEYCOMBE” as part of the likelihood-of-confusion inquiry, without treating descriptiveness as a basis to invalidate an incontestable mark.
- The court affirmed the denial of leave to amend and agreed Matsui failed to show “HONEYCOMBE” was generic on the record presented.

## Legal Principles

- A permanent injunction for trademark infringement requires proof of a likelihood of confusion; appellate review of the district court’s confusion findings is for clear error.
- Incontestability bars certain validity attacks (e.g., “merely descriptive” as a ground to cancel), but does not prevent a court from weighing a mark’s strength (including descriptive character) when deciding likelihood of confusion.
- Descriptive, non-source-identifying use of a term—especially in a technical setting involving sophisticated purchasers and distinct marketing channels—may support a finding of no likelihood of confusion.
- District courts have discretion to deny late amendments to add a genericness counterclaim, particularly where the party had an opportunity to develop evidence and did not establish genericness.

## Conclusion

The court upheld the denial of permanent injunctive relief because Matsui’s continued use of “honeycomb” was descriptive rather than trademark use and was not likely to confuse purchasers, and it rejected Matsui’s late attempt to add a genericness challenge to the registration.


Munters Corp. v. Matsui Am., Inc., 909 F.2d 250 (7th Cir. 1990)