Nutrition Distribution, LLC v. Enhanced Athlete, Inc. et al

Filing 24

ORDER signed by District Judge John A. Mendez on 11/13/17, DENYING plaintiff's 10 Motion for Preliminary Injunction. (Kastilahn, A)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 NUTRITION DISTRIBUTION, LLC, 12 13 14 15 16 17 No. 2:17-cv-2069-JAM-CKD Plaintiff, v. ORDER DENYING MOTION FOR PRELIMINARY INJUNCTION ENHANCED ATHLETE, INC., a Wyoming Corporation; GILMORE ENGINEERING, INC., an unincorporated association; SCOTT E. CAVELL, an individual; CHARLES ANTHONY HUGHES, an individual; and DOES 1 through 10, inclusive, 18 Defendants. 19 20 Plaintiff Nutrition Distribution, LLC, doing business as 21 Athletic Xtreme (“Plaintiff”) is suing Enhanced Athlete, Inc., 22 Gilmore Engineering, Inc., Scott E. Cavell, and Charles Anthony 23 Hughes (collectively “Defendants”) for false advertising and 24 violation of the Civil Racketeer Influenced and Corrupt 25 Organization Act (“RICO”). Plaintiff now seeks a preliminary 26 injunction enjoining Defendants from producing, licensing, 27 marketing, and selling DNP products and from establishing any 28 1 1 other entity for the purpose of doing so. 2 forth below, Plaintiff’s motion for preliminary injunction is 3 DENIED. For the reasons set 4 5 I. 6 FACTUAL ALLEGATIONS AND PROCEDURAL BACKGROUND Plaintiff has accused Defendants of false and misleading 7 advertising with respect to products containing 2,4-Dinitrophenol 8 (“DNP”), which Defendants market and sell to body builders, gym 9 users, and the like. Compl. ¶¶ 1, 3. Plaintiff contends that 10 this product is dangerous for human consumption but Defendants 11 promote it as an ingestible fitness supplement that increases fat 12 loss. 13 own supplement—Slim FX—which competes for similar customers. 14 at ¶¶ 18–21. 15 under § 43(a)(1)(B) of the Lanham Act and for engaging in a long- 16 term scheme to defraud customers in violation of RICO. 17 ¶¶ 38–54. 18 See id. at ¶ 28. Plaintiff manufactures and markets its Id. Plaintiff now sues Defendants for false advertising Id. at Shortly after filing this suit, Plaintiff filed an ex parte 19 application for a temporary restraining order. 20 Court denied the request, finding Plaintiff failed to file the 21 requisite affidavits in support of its motion, and set a briefing 22 schedule for the preliminary injunction request. 23 Hughes and Cavell attest that they have not yet been served with 24 the summons and complaint in this lawsuit. 25 Hughes Decl. ¶ 2. 26 behalf of Enhanced Athlete and Cavell, appearing solely for the 27 purposes of opposing the pending motion. ECF No. 4. The ECF No. 8. Cavell Decl. ¶¶ 9–10; Rutan & Tucker, LLP, filed an opposition on 28 2 Opp’n at 5. 1 2 II. OPINION 3 A. 4 “A plaintiff seeking a preliminary injunction must establish Legal Standard 5 the he is likely to succeed on the merits,that he is likely to 6 suffer irreparable harm in the absence of preliminary relief, 7 that the balance of equities tips in his favor, and that an 8 injunction is in the public interest.” 9 Rockies v. Cottrell, 632 F.3d 1127, 1131 (9th Cir. 2011) (quoting Alliance for the Wild 10 Winter v. Natural Resources Defense Council, 555 U.S. 7 (2008)). 11 A plaintiff must establish that the irreparable harm is likely, 12 not just possible. Id. 13 B. 14 The Court finds Plaintiff is not entitled to a preliminary Analysis 15 injunction because it has failed to demonstrate irreparable harm. 16 Because this conclusion is dispositive, the Court does not need 17 to address the remaining three factors set out in Winter. See 18 Nutrition Distribution LLC v. Lecheek Nutrition, Inc., No. CV 15- 19 1322-MWF (MRWx), 2015 WL 12659907 (C.D. Cal. June 5, 2015) 20 (“Indeed, suffering irreparable harm prior to a determination of 21 the merits is perhaps the single most important prerequisite for 22 the issuance of a preliminary injunction.”) (citation and 23 quotation marks omitted). 24 Plaintiff argues the irreparable harm prong of the Winter 25 test is met because of the serious risk of harm DNP poses to the 26 life of those who ingest it. 27 provides no authority under which the Court may consider 28 irreparable harm to third parties in lieu of or in addition to Mot. at 17–18. 3 However, Plaintiff 1 irreparable harm to Plaintiff. 2 plaintiff seeking a preliminary injunction must establish . . . 3 that he is likely to suffer irreparable harm[.]”) (emphasis 4 added); Wooten v. BNSF Railway Co., No. CV 16-139-M-DLC-JCL, 2017 5 WL 1089546, at *1 (D. Mont. Mar. 21, 2017) (“The Court agrees 6 with Judge Lynch that harms alleged against third parties are not 7 relevant to the irreparable harm prong of the Winter analysis.”). 8 Plaintiff is a competitor, not a consumer. 9 appropriate to consider this risk in weighing public interest See Winter, 555 U.S. at 20 (“A While it may be 10 concerns, the Court may not consider it in the irreparable harm 11 analysis. 12 Plaintiff also argues that it “has lost sales after the 13 introduction of DNP into the marketplace.” 14 Plaintiff cites a paragraph in Michael Keplinger’s declaration in 15 support: “Slim FX sales decreased significantly since the fall of 16 2016 after the reintroduction of DNP into the marketplace by 17 Defendants. 18 of 2016, our sales of DNP have decreased 38%.” 19 ¶ 5. 20 evidence is irrelevant because “in Lanham Act cases . . . 21 injunctive relief may be granted upon proof that a false 22 statement of fact in a commercial advertisement is material and 23 has a tendency to deceive the relevant purchasing public[,]” 24 which is sufficient to establish irreparable injury. 25 (citing National Products, Inc. v. Gamber-Johnson LLC, 734 F. 26 Supp. 2d 1160, 1171 (W.D. Wash. 2010)). 27 28 Mot. at 18. Since Defendants began selling DNP during the Fall Keplinger Decl. Plaintiff also contends that any deficiency in this Rep. at 3–4 The Court will not presume irreparable harm in evaluating the propriety of granting a preliminary injunction in a false 4 1 advertising case. 2 Cutlery Co., 823 F. Supp. 2d 1150, 1157–58 (D. Ore. 2011) (“Given 3 the direction that the Supreme Court and Ninth Circuit have taken 4 in the context of copyright and patent cases, I decline to find 5 that a presumption of irreparable harm exists in a false 6 advertising claim.”); Nutrition Distribution LLC, 2015 WL 7 12659907, at *7 (“Plaintiff has not demonstrated that any injury 8 it might suffer would be irreparable absent an injunction.”). 9 Plaintiff’s cited cases applying such presumption either predate See Leatherman Tool Grp., Inc. v. Coast 10 decisions strictly requiring a showing that irreparable harm is 11 likely or rely on that earlier authority. 12 734 F. Supp. 2d at 1171 (relying on Southland Sod Farms v. Stover 13 Seed Co., 108 F.3d 1134 (9th Cir. 1997)); cf. Leatherman Tool 14 Grp., 823 F. Supp. 2d at 1156–57 (“Leatherman argues that it is 15 entitled to a presumption of irreparable harm if a tendency to 16 deceive has been established. . . . 17 of the use of ‘categorical’ rules with respect to irreparable 18 harm. . . . It is now clear that eBay signifies a return to 19 traditional equitable principles, under which presumptions of 20 harm are not allowed.”) (citing eBay, Inc. v. MercExchange, LLC, 21 547 U.S. 388 (2006)). 22 involved a permanent injunction or damages following 23 adjudication, not a determination of irreparable harm during the 24 pendency of a case. 25 See National Products, The eBay Court disapproved Further, the cases Plaintiff relies upon Without a presumption, Plaintiff’s evidence is insufficient 26 to establish irreparable harm. 27 not establish a causal connection—or even more than a merely 28 speculative connection—between Defendants’ product and marketing The proffered declaration does 5 1 and Plaintiff’s decrease in sales. 2 provides evidence supporting its loss in sales, which may be 3 remedied by monetary damages. 4 WL 12659907 at *7 (“An irreparable harm is one that cannot be 5 redressed by a legal or equitable remedy following trial.”). 6 Because Plaintiff has not demonstrated it is likely to suffer 7 irreparable harm its motion for a preliminary injunction must be 8 denied. 9 10 11 12 13 III. Furthermore, Plaintiff only See Nutrition Distribution, 2015 ORDER For the reasons set forth above, the Court DENIES Plaintiff’s Motion for Preliminary Injunction. IT IS SO ORDERED. Dated: November 13, 2017 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 6

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