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Inter123 Corporation v. Ghaith

United States District Court, D. Arizona

May 5, 2014

Inter123 Corporation, Plaintiff,
Chadi Ghaith, Defendant.


DAVID G. CAMPBELL, District Judge.

Plaintiff Inter123 Corporation filed an amended complaint on April 8, 2014. Doc. 32. Plaintiff then filed a renewed motion for alternative service (Doc. 33), a second application for a temporary restraining order ("TRO") and preliminary injunction (Doc. 36), and a supplement to its TRO application (Doc. 37). Defendant Chadi Ghaith has not responded. Plaintiff has not requested oral argument. For the reasons that follow, the Court will grant the motion for alternative service and deny the motion for a TRO and preliminary injunction.

I. Background.

Plaintiff commenced this action on March 7, 2014, alleging breach of contract against Defendant. Plaintiff had anonymously negotiated to purchase the domain name "" for $59, 000 from Defendant through a third party website called After Plaintiff tendered the sale price to, Plaintiff alleges that Defendant reneged on his obligations under the sale contract and transferred from GoDaddy in Arizona, where it had been hosted, to Instra Corporation in Melbourne, Australia. Plaintiff sought a TRO, which the Court granted. After two preliminary injunction hearings, the Court vacated the TRO and denied the motion for a preliminary injunction after determining that Defendant did not have sufficient contacts with Arizona to support personal jurisdiction. Doc. 30. Plaintiff subsequently filed an amended complaint (Doc. 32), adding claims for trademark infringement, unfair competition, and conversion. Plaintiff now requests a TRO and preliminary injunction based on its amended complaint.

II. Application for TRO and Preliminary Injunction.

In order to obtain a preliminary injunction, Plaintiff must establish that it is likely to succeed on the merits, that it is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in its favor, and that an injunction is in the public interest. Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 20 (2008). The Ninth Circuit continues to analyze the four elements using a "sliding scale" approach, in which "the elements of the preliminary injunction test are balanced, so that a stronger showing of one element may offset a weaker showing of another." Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1131 (9th Cir. 2011). Should the moving party demonstrate a very high likelihood of injury, the likelihood of success on the merits may be relaxed. An injunction may be granted when serious questions going to the merits are raised and the balance of hardships tips sharply in the plaintiff's favor. Wild Rockies, 632 F.3d at 1135.

As to the breach of contract and specific performance claims, the Court concludes that the analysis in its previous order still applies (Doc. 30) because Plaintiff has not alleged any new facts that would support an exercise of personal jurisdiction. The Court will analyze each of Plaintiff's newly asserted claims.

A. Trademark Infringement.

"A successful trademark infringement claim under the Lanham Act requires a showing that the claimant holds a protectable mark, and that the alleged infringer's imitating mark is similar enough to cause confusion, or to cause mistake, or to deceive.'" Surfvivor Media, Inc. v. Survivor Prods., 406 F.3d 625, 630 (9th Cir. 2005) (quoting KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 125 S.Ct. 542, 547 (2004)). Likelihood of confusion exists where reasonably prudent consumers in the marketplace are "likely to be confused as to the origin of the good or service bearing one of the marks." Surfvivor, 406 F.3d at 630 (internal citation and quotation marks omitted). Courts look to the following eight Sleekcraft factors when analyzing the likelihood of confusion: (1) strength of the mark(s); (2) relatedness of the goods; (3) similarity of the marks; (4); evidence of actual confusion; (5) marketing channels; (6) degree of consumer care; (7) the defendant's intent; and (8) likelihood of expansion. Id. at 631 (citing AMF, Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-49 (9th Cir. 1979)). "The test is a fluid one and the plaintiff need not satisfy every factor, provided that strong showings are made with respect to some of them." Id.

1. Strength of the Mark.

There are several categories of trademarks: arbitrary (common words with no connection to the product), fanciful (coined phrases with no known connection to the product), suggestive (does not describe the features of a product but suggests them), descriptive (defines a particular characteristic of a product in a way that does not require any exercise of the imagination), and generic (describes the product in its entirety). Surfvivor, 406 F.3d at 631-32. Arbitrary and fanciful marks are given the greatest protection while descriptive and generic marks are given the least. Id.

The marks at issue here are several marks owned by Plaintiff -,,, and - and the domain name Defendant was to sell to Plaintiff and that Defendant is now accused of converting. The website now associated with appears to offer a comparison of mobile phones for sale. and its accompanying Spanish websites appear to be a collection of articles and other content related to mobile electronic devices. appears to direct users to Plaintiff's other websites.

In considering Plaintiff's likelihood of success on the merits, the Court concludes that it is likely to find that all the marks are descriptive because they describe a characteristic of the "products" in a way that does not require an exercise of the imagination. Because descriptive marks are ...

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