United States District Court, D. Arizona
ORDER
Honorable Steven P. Logan United States District Judge
Plaintiff
Kangaroo Manufacturing Incorporated (the
“Plaintiff”) filed suit against Amazon.com
Incorporated (the “Defendant”) alleging trademark
infringement, among other claims. (Doc. 1) The Defendant
moved for summary judgement on each of the Plaintiff's
claims (the “Motion”). (Doc. 72) The Motion was
fully briefed on August 28, 2018. (Docs. 78, 82) The
Court's ruling is as follows.
I.
Background
This
action arises out of the alleged unauthorized sale of emoji
beach balls. The Plaintiff is a corporation formed for the
purpose of manufacturing products for resale on Amazon.com.
(Doc. 1 at 2; Doc. 73 at 2) The Plaintiff now distributes
several products, such as emoji beach balls and flamingo pool
floats, through multiple third-party sellers on Amazon.com.
(Doc. 73 at 2; Doc. 1 at 6) The Defendant operates the
Amazon.com website and allows third parties to register as
sellers on the website. (Doc. 73 at 1)
Third-party
sellers create their own listing for a product that they plan
to sell, including uploading their own images of the product,
and set their own prices for the product. (Doc. 73 at 1) Each
product is identified with a universal product code
(“UPC code”) and an Amazon Standard
Identification Number, and each product also receives its own
product detail page (“PDP”). (Doc. 1 at 2, 3)
Multiple sellers can list the same product for sale on the
same PDP. (Doc. 73 at 1-2). However, only one seller may be
awarded the “Buy Box” on a PDP, which makes the
seller's item the default for a customer's purchase.
(Doc. 73 at 8) When a seller signs up to sell products on the
Defendant's website, it agrees to the terms of the Amazon
Services Business Solutions Agreement (the “BSA”)
and the policies incorporated by the BSA. (Doc. 73 at 2; Doc.
80 at 5)
At some
point, the Plaintiff became aware that its products were
being sold on the Defendant's website by sellers that
were not authorized by the Plaintiff to do so. (Doc. 1 at 5)
The Plaintiff also accuses the Defendant of selling
counterfeit products itself. (Doc. 80 at 7) The Plaintiff
alleges that these sales violate the Plaintiff's
trademark and copyright interests. (Doc. 1 at 5) The
Defendant's website has a process by which a seller can
report infringement of intellectual property rights, and both
parties assert that the Plaintiff submitted infringement
reports. (Doc. 73 at 6, 7; Doc. 80 at 5, 6)
The
Plaintiff initiated this lawsuit (the
“Complaint”) alleging claims for trademark and
copyright infringement, among other claims. (Doc. 1) The
Complaint alleges that the Defendant (i) failed to address
the Plaintiff's claims of trademark and copyright
infringement; (ii) continued to allow unauthorized sellers to
sell the Plaintiff's products after the Plaintiff's
infringement reports were made; (iii) re-sold some of the
counterfeit product that it re-purchased from the Plaintiff
as reimbursement for unauthorized sales; (iv) improperly
managed the UPC codes assigned to the Plaintiff's
products; and (v) profited from the fees it received from
sales made by unauthorized sellers. (Doc. 1 at 10, 6, 8, 11,
14; Doc. 80 at 4) The Defendant moved for partial summary
judgment on the Plaintiff's claims. (Doc. 72)
II.
Legal Standard
A court
shall grant summary judgment if the pleadings and supporting
documents, viewed in the light most favorable to the
non-moving party “show that there is no genuine dispute
as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed.R.Civ.P. 56(a);
see also Celotex Corp. v. Catrett, 477 U.S. 317,
322-23 (1986). Material facts are those facts “that
might affect the outcome of the suit under the governing
law.” Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 248 (1986). A genuine dispute of material fact
arises if “the evidence is such that a reasonable jury
could return a verdict for the nonmoving party.”
Id.
The
party moving for summary judgment bears the initial burden of
informing the court of the basis for its motion and
identifying those portions of the record, together with
affidavits, which it believes demonstrate the absence of a
genuine issue of material fact. Celotex, 477 U.S. at
323. If the movant is able to do such, the burden then shifts
to the non-movant who, “must do more than simply show
that there is some metaphysical doubt as to the material
facts, ” and instead must “come forward with
‘specific facts showing that there is a genuine issue
for trial.'” Matsushita Elec. Indus. Co. v.
Zenith Radio Corp., 475 U.S. 574, 586-87 (1986).
III.
Analysis
First,
the Court notes that the relief requested in the Motion is
borderline unintelligible. At times, the Defendant states
that it seeks summary judgment on all claims, and, at other
times, the Defendant seeks dismissal of some claims. (Doc. 72
at 6, 7, 20) In other parts of the Motion, the Defendant
states that it is willing to move forward with three claims,
Counts I, II and IV, but then later seeks dismissal of these
claims, all while identifying the Motion as one for
“partial summary judgment.” (Doc. 72 at 1, 6, 12,
14, 19, 22) At this point, the Court will address the merits
of each claim under the summary judgment standard. And where
the Defendant has conceded that elements of certain claims
should be preserved for trial, the Court will do so.
Accordingly, each claim will be addressed in turn.
A.
Count I - Trademark Infringement and False Designation of
Origin.
The
Defendant states that it is not seeking summary judgment on
the Plaintiff's Lanham Act claims to the extend that
those claims allege that the Defendant “itself sold
certain of the accused products.” (Doc. 72 at 6) The
Court finds that the allegations set forth by the Plaintiff
in Count I each focus on the Defendant's actions in
advertising, selling and trading on the Plaintiff's
registered trademark. (Doc. 1 at 5-6, stating that
“Unauthorized sales on Amazon have included . . .
products sold by Amazon itself.”) Accordingly, the
Court will preserve the Plaintiff's trademark
infringement claims pursuant to 15 U.S.C. § 1114 and 15
U.S.C. § 1125 for trial, and the Motion will be denied
as to Count 1.
B.
Count II - Use of Counterfeit Trademarks.
In the
same vein, the Court will not address Count II under the
summary judgment standard. (Doc. 72 at 6, stating that the
Defendant is not seeking summary judgment on the
Plaintiff's Lanham Act claims to the extent that those
claims arise out of the Defendant's alleged sale of
infringing products.) The Court finds that the allegations
set forth by the Plaintiff in Count II focus on the
Defendant's actions in selling products using counterfeit
trademarks. (Doc. 1 at 5, 8) Accordingly, the Court will
preserve the Plaintiff's use of counterfeit trademarks
claims pursuant to 15 U.S.C. § 1117 and 15 U.S.C. §
1116(d) for trial, and the Motion will be denied as to Count
2.
C.
Count III - ...