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BBK Tobacco & Foods LLP v. Skunk Inc.

United States District Court, D. Arizona

April 30, 2019

BBK Tobacco & Foods LLP, Plaintiff,
v.
Skunk Incorporated, Vatra Incorporated, Defendants.

          ORDER

          JAMES A. TEILBORG, SENIOR UNITED STATES DISTRICT JUDGE

         Pending before the Court is Defendants' Motion to Dismiss. (Doc. 36). The Motion is fully briefed. Defendants sought oral argument on the motion but because both parties submitted memoranda discussing the law and facts in support of their positions and oral argument would not aide the Court's decisional process, the Court did not hold argument on the motion. See e.g., Partridge v. Reich, 141 F.3d 920, 926 (9th Cir. 1998); Lake at Las Vegas Investors Group, Inc. v. Pacific. Dev. Malibu Corp., 933 F.2d 724, 729 (9th Cir. 1991).

         Defendants' motion can be broken down into three arguments: 1) Plaintiff fails to state a claim under any of its six causes of action[1] primarily because Plaintiff fails to show a likelihood of confusion; 2) Plaintiff fails to state a claim against Defendant Vatra because Plaintiff fails to make any allegations against Defendant Vatra beyond the allegations against Defendant Skunk; and 3) if the Court denies the motion(s) to dismiss for failure to state a claim, Defendants seek a more definite statement. The Court will address each argument in turn.

         I. Factual Background

         The following summary of the facts is taken from the complaint. The Court notes that Defendants dispute many of these facts; but, in deciding a motion to dismiss for failure to state a claim, the Court must construe the facts alleged in the complaint in the light most favorable to the Plaintiff and the Court must accept all well-pleaded factual allegations as true. See Shwarz v. United States, 234 F.3d 428, 435 (9th Cir. 2000).

         Plaintiff uses the Skunk and Skunk Brand names to identify various smoking-related accessories. (Doc. 1 at 3, ¶ 19). Plaintiff has used the Skunk Brand trademark since 1999. (Doc. 1 at 3-4, ¶ 21a). Plaintiff has secured several U.S. Patent and Trademark Office trademark registrations of Plaintiff's Skunk and Skunk Brand marks for smoking-related accessories. (Doc. 1 at 3-4, ¶¶ 21-24).

         Plaintiff alleges that Defendants sell smell-proof bags using the “Skunk” name. (Doc. 1 at 6, ¶ 31). Plaintiff alleges that Defendants use a design image of a skunk's tail on Defendants products. (Doc. 1 at 6, ¶ 34). Plaintiff alleges that Defendants sell the smell-proof bags, including “vape cases”, to purchasers of smoking-related products. (Doc. 1 at 6, ¶ 38). Plaintiff alleges that Defendants were advertisers/exhibitors at the Champs Tradeshow in Las Vegas, Nevada, in July 2018. (Doc. 1 at 6, ¶¶ 40-41), and at two other tradeshows thereafter (Doc. 1 at 6-7, ¶¶ 43-44).

         II. Motion to Dismiss the Six Claims in the Complaint

         A. Failure to State a Claim

         The Court may dismiss a complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6) for two reasons: 1) lack of a cognizable legal theory and 2) insufficient facts alleged under a cognizable legal theory. Balistreri v. Pacifica Police Dep=t, 901 F.2d 696, 699 (9th Cir. 1990).

         To survive a 12(b)(6) motion to dismiss for failure to state a claim, a complaint must meet the requirements of Federal Rule of Civil Procedure 8(a)(2). Rule 8(a)(2) requires a “short and plain statement of the claim showing that the pleader is entitled to relief, ” so that the defendant has “fair notice of what the . . . claim is and the grounds upon which it rests.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)).

         Although a complaint attacked for failure to state a claim does not need detailed factual allegations, the pleader's obligation to provide the grounds for relief requires “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555 (internal citations omitted). The factual allegations of the complaint must be sufficient to raise a right to relief above a speculative level. Id. Rule 8(a)(2) “requires a ‘showing,' rather than a blanket assertion, of entitlement to relief. Without some factual allegation in the complaint, it is hard to see how a claimant could satisfy the requirement of providing not only ‘fair notice' of the nature of the claim, but also ‘grounds' on which the claim rests.” Id. (citing 5 C. Wright & A. Miller, Federal Practice and Procedure §1202, pp. 94, 95 (3d ed. 2004)).

         Rule 8's pleading standard demands more than “an unadorned, the-defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 555). A complaint that offers nothing more than naked assertions will not suffice. To survive a motion to dismiss, a complaint must contain sufficient factual matter, which, if accepted as true, states a claim to relief that is “plausible on its face.” Iqbal, 556 U.S. at 678. Facial plausibility exists if the pleader pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Id. Plausibility does not equal “probability, ” but plausibility requires more than a sheer possibility 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. (citing Twombly, 550 U.S. at 557).[2]

         In this case, Defendants argue:

Lanham Act Section 32 for registered marks and 43(a) for unregistered ones prohibit the use of a mark that is likely to cause confusion. 15 U.S.C. §§ 1114, and 1125(a); Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 (1992) (“[L]iability under § 43(a) requires proof of the likelihood of confusion.”). Thus, in order to assert a valid trademark infringement claim, Plaintiff BBK's Complaint is required to state the following allegations with the requisite specificity: (1) Plaintiff owns a valid, protectable trademark; and (2) Defendant SKUNK uses a mark similar to Plaintiff's brand and Mark without the consent of Plaintiff in a manner that is likely to cause confusion among ordinary consumers as to the source, sponsorship, affiliation, or approval of the goods. Dep't of Parks & Recreation v. Bazaar Del Mundo Inc., 448 F.3d 1118, 1124 (9th Cir. 2006). Here, the Complaint does not adequately allege sufficient facts establishing a plausible likelihood of confusion.

(Doc. 36 at 8-9).

         Plaintiff states:

As stated in the Defendants' Motion, the six causes of action in the Complaint are share common elements. Motion at 9. See also, e.g., Interstellar Starship Servs. Ltd. v. Epix, Inc., 184 F.3d 1107, 1110 (9th Cir.1999) (The ultimate test for unfair competition is exactly the same as for federal trademark infringement, that is “whether the purchaser is likely to be deceived or confused by the similarity of the marks.”).

(Doc. 39 at 6, n. 5).

         Thus, the parties agree that the issue is whether Plaintiff has adequately alleged “likelihood of confusion” to state a claim. The Ninth Circuit Court of Appeals has identified eight nonexclusive factors the Court should consider in determining whether consumer confusion is likely: (1) the strength of the plaintiff's mark; (2) the proximity or relatedness of the goods; (3) the similarity of the marks; (4) evidence of actual confusion; (5) marketing channels used; (6) the type of goods and likely degree of purchaser care; (7) defendant's intent in selecting the mark; (8) likelihood of expansion of the product lines. AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-49 (9th Cir. 1979) (“Sleekcraft factors”). Plaintiff need not allege, or prove, every Sleekcraft factor. See Brookfield Commc'ns v. West Coast Entertainment Corp., 174 F.3d 1036, 1054 (9th Cir. 1999).

         In the motion to dismiss, Defendants argue Plaintiff fails to allege 3 of these factors: 3) similarity of the marks (Doc. 36 at 7); 5) marketing channels used (Doc. 36 at 10); and 6) type of goods (Doc. 36 at 10). In the reply, Defendants argue Plaintiff fails to allege 2 additional factors: 4) actual confusion (Doc. 41 at 7-8); and 7) defendant's intent in selecting the mark (Doc. 41 at 9). In reading Defendants' motion and reply as a whole, the Court notes that Defendants do not actually dispute whether Plaintiff has made an allegation as to each of the factors, but rather whether that allegation is plausible.

         1. ...


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