Thermolife International LLC v. Neogenis Labs Inc.

          ORDER

          H. RUSSEL HOLLAND, UNITED STATES DISTRICT JUDGE

         Motion to Dismiss

         Defendant moves to dismiss plaintiff's complaint.^[1] This motion is opposed.^[2] Oral argument was requested and has been heard.

         Background

         Plaintiff is ThermoLife International, LLC. Defendant is NeoGenis Labs, Inc. d/b/a HumanN. Defendant contends however that it is now known as the Human Power of N Company.

         Plaintiff was founded in 1998 by Ron Kramer.^[3] Plaintiff alleges that it “is a world leader in the use and development of nitrate technology” and that it “holds several patents related to the use of amino acids in combination with nitrates to increase performance.”^[4]Plaintiff alleges that it is “the exclusive licensee of U.S. Patent No. 9, 180, 140 (‘the ‘140 Patent'), ” which “protects a method of administering nitrate or nitrite to humans in order to non-therapeutically cause a reduced oxygen uptake during exercise.”^[5]

         Plaintiff alleges that “[d]efendant is a direct competitor of ThermoLife in the sale of nitrite and nitrate technology.”^[6] Plaintiff alleges that defendant was “formed in 2009” and that “Joel Kocher, Dr. Nathan Bryan, [and] Janet Zand are all co-founders of” defendant.^[7]

         Plaintiff alleges that defendant is falsely marking its N-O Indicator Strips product as “patent pending” and also falsely advertising the N-O Indicator Strips as patent pending.”^[8]According to defendant's advertising, the N-O Indicator Strips “are a simple way to see if you're getting enough dietary nitrate through the foods that you eat.”^[9] Plaintiff alleges that defendant's “Nitric Oxide Indicator Strips do not enjoy patent protection and there is no patent pending related to this technology.”^[10] Plaintiff alleges that “[i]n fact, on August 13, 2013, HumanN's Dr. Nathan Bryan applied for a patent for a ‘method of determining the level of nitric oxide (NO) or nitrite (NO2-)” but that “[t]he United States Patent Office rejected all 35 proposed patent claims.”^[11]

         Plaintiff also alleges that “[c]ontrary to [defendant's] false claims, it is well-settled that you cannot determine whether an individual is ‘deficient in N-O [Nitric Oxide]' and/or ‘getting sufficient Nitric Oxide activating nutrients through [his] diet' simply by testing [his] saliva.”^[12] Plaintiff alleges that the 2015 Clodfelter study tested defendant's N-O Indicator Strips, along with other similar products, and concluded that “‘[t]here is no correlation between plasma NO2- and salivary NO3-. . . . Our results argue against the use of salivary NO2- as a marker for NO bioavailability.'”^[13]

         Plaintiff alleges that defendant is also falsely marking three of its other products, BeetElite, SuperBeets, and Neo40. Plaintiff alleges that defendant formerly “list[ed] six patent numbers” on the labels of these products but that in mid-2017, defendant removed three of the patent numbers because the products never practiced these patents.^[14] Plaintiff alleges, however, that defendant's “website, Amazon.com, and countless other websites on the internet where consumers go to actually purchase the product, still mislead consumers by showing all six patent numbers.”^[15]

         As for the three patents still listed on the products' labels, the ‘589, ‘570, and ‘999 patents, plaintiff alleges that BeetElite and SuperBeets “do not practice” any of these patents.^[16] Plaintiff alleges that all three patents “require a ‘nitrite salt' to practice the patented inventions” but that defendant “is well aware that its SuperBeets and BeetElite products do not contain a nitrite salt[.]”^[17] The labels for defendant's products indicate that they use beetroot^[18] and plaintiff alleges that “[t]he patent[] specifications for each of the patents marked on [defendant's] products all indicate that ‘nitrate salts' and nitrites from vegetable sources are two different things.”^[19]

         Plaintiff further alleges that

even if the nitrites in the BeetElite and SuperBeets products could be considered ‘nitrite salts' (which they cannot), the products would still also be falsely marked, falsely advertised, misbranded, and prohibited for sale in interstate commerce because they are under-dosed (i.e., they fail to include sufficient quantity of nitrites of any sort to practice the patented inventions).^[20]

         Plaintiff alleges that it did laboratory testing on the BeetElite and SuperBeets products in 2016 and 2018 and that both tests showed that the products contained an insufficient amount of nitrites to practice the ‘589 and ‘570 patents.^[21] Plaintiff also alleges that defendant's “Neo40 products cannot and do not practice the patents that Neo40 is marked with.”^[22]

         Plaintiff alleges that defendant is also falsely advertising that the BeetElite, SuperBeets, and Neo40 products “contain ‘patented Nitric Oxide technology.'”^[23] Plaintiff alleges that defendant's “claims that its products rely on patented technology for the production of Nitric Oxide is directly contrary to the United States Patent Office's decision that [defendant's] co-founder is not entitled to any patent claims for ‘generating and/or increasing levels of Nitric Oxide.'”^[24]

         Plaintiff also alleges that defendant is falsely advertising that its employees or founders have won a Nobel Prize for research related to Nitric Oxide.^[25] For example, plaintiff alleges that defendant makes the following statement on its website:

[o]ur research on Nitric Oxide first began with the discovery of its unique impact on cardiovascular health. Its immense importance as a biological signaling molecule resulted in the awarding of the Nobel Prize in 1998. Realizing that the discovery of Nitric Oxide had immense potential, it didn't take long for our interest in N-O to become our passion.^[26]

         Plaintiff alleges that defendant had nothing to do with the 1998 Nobel Prize to which it refers.^[27] Plaintiff alleges that defendant “falsely advertises itself as a Nobel Prize winner in order to falsely convey to consumers that its owns a monopoly on ‘patented Nitric Oxide technology.'”^[28]

         Plaintiff alleges that defendant also falsely advertises that it is the only company “that can practice ‘patented N-O platform technology.'”^[29] Plaintiff alleges that this is a false statement because there are many other dietary supplements that “practice Nitric Oxide technology[, ]” including products that use Creatine Nitrate which is “supplied by” plaintiff.^[30]

         Finally, plaintiff alleges that defendant is falsely advertising all of its products as Foods or Dietary Supplements.^[31] Plaintiff alleges that this means defendant's products are misbranded because their labels contain false or misleading information.^[32]

         Plaintiff commenced this action on September 20, 2018. Plaintiff asserts three causes of action in its complaint. In its first cause of action, plaintiff asserts false marking claims pursuant to 35 U.S.C. § 292. In its second cause of action, plaintiff asserts Lanham Act false advertising claims. And, in its third cause of action, plaintiff asserts common law unfair competition claims.

         Pursuant to Rule 12(b)(6), Federal Rules of Civil Procedure, defendant now moves to dismiss plaintiff's complaint.

         Discussion \

         “‘To survive a [Rule 12(b)(6)] motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'” Zixiang Li v. Kerry, 710 F.3d 995, 999 (9th Cir. 2013) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “A claim is facially plausible ‘when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'” Id. (quoting Iqbal, 556 U.S. at 678). “The plausibility standard requires more than the sheer possibility or conceivability that a defendant has acted unlawfully.” Id. “‘Where a complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the line between possibility and plausibility of entitlement to relief.'” Id. (quoting Iqbal, 556 U.S. at 678). “[T]he complaint must provide ‘more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.'” In re Rigel Pharmaceuticals, Inc. Securities Litig., 697 F.3d 869, 875 (9th Cir. 2012) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). “In evaluating a Rule 12(b)(6) motion, the court accepts the complaint's well-pleaded factual allegations as true and draws all reasonable inferences in the light most favorable to the plaintiff.” Adams v. U.S. Forest Srvc., 671 F.3d 1138, 1142-43 (9th Cir. 2012). “However, the trial court does not have to accept as true conclusory allegations in a complaint or legal claims asserted in the form of factual allegations.” In re Tracht Gut, LLC, 836 F.3d 1146, 1150 (9th Cir. 2016).

         “When ruling on a Rule 12(b)(6) motion, if ‘matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56.'” Hicks, 897 F.3d at 1117 (quoting Fed.R.Civ.P. 12(d)). “The ‘pleadings' include more than just the complaint.” Id. The court may “consider ‘exhibits attached to the Complaint or matters properly subject to judicial notice.'” Id. (quoting Daniels-Hall, 629 F.3d at 998). “Moreover, ” the court “‘may also consider documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the [plaintiff's] pleading.'” Id. (quoting Northstar Fin. Advisors Inc. v. Schwab Invs., 779 F.3d 1036, 1043 (9th Cir. 2015)). Defendant has offered thirteen exhibits in support of its motion to dismiss and argues that the court can consider all of them without converting the instant motion into a motion for summary judgment.

         Exhibit 1 is an October 12, 1998 press release about the Nobel Prize being awarded to three individuals for “their discoveries concerning ‘nitric oxide as a signaling molecule in the cardiovascular system.'”^[33] Defendant argues that the court could take judicial notice of this exhibit, but there is no reason for the court to do so. Plaintiff has alleged that “[t]he Nobel Prize” at issue in this case “was awarded in 1998 to Robert Francis Furchgott, Louis J. Ignarro, and Ferid Murad for their discoveries concerning nitric oxide as a signaling molecule in the cardiovascular system.”^[34] The court assumes this allegation is true for purposes of the instant motion.

         Exhibit 2 is a copy of the Clodfelter study. The court may consider this exhibit without converting the instant motion into a motion for summary judgment because ...