Macy's Inc. et al v. Strategic Marks, LLC

Filing 77

Order by Hon. Samuel Conti denying 55 Plaintiffs Macy's, Inc. and, Inc.'s Motion for Partial Summary Judgment.(sclc2, COURT STAFF) (Filed on 3/19/2013)

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1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE NORTHERN DISTRICT OF CALIFORNIA 8 United States District Court For the Northern District of California 9 10 MACY'S, INC. and MACYS.COM, INC., 11 Plaintiffs, 12 v. 13 STRATEGIC MARKS, LLC, 14 Defendant. 15 ) ) ) ) ) ) ) ) ) ) ) ) ) ) Case No. 11-6198 SC ORDER DENYING PLAINTIFFS MACY'S, INC. AND MACYS.COM, INC.'S MOTION FOR PARTIAL SUMMARY JUDGMENT 16 17 I. 18 INTRODUCTION Now before the court is Plaintiffs and Counter-Defendants 19 Macy's, Inc. and, Inc.'s ("Plaintiffs") motion for 20 partial summary judgment against Defendant and Counter-Claimant 21 Strategic Marks, LLC. ("Defendant"). 22 motion is fully briefed, ECF Nos. 63 ("Opp'n"), 66 ("Reply"), and 23 appropriate for resolution without oral argument, Civ. L.R. 7-1(b). 24 For the reasons explained below, the Court DENIES Plaintiffs' 25 motion for partial summary judgment. 26 /// 27 /// 28 /// ECF No. 55 ("Mot.") The 1 II. BACKGROUND 2 The instant matter arises from Defendant's counterclaims 3 against Plaintiffs for trademark infringement, among other things, 4 based on Defendant's registrations and applications for four 5 service marks, "The Broadway," "The Bon Marche," "Robinson's," and 6 "Abraham & Straus," under the Lanham Act, 15 U.S.C. section 1051 et 7 seq. 8 "The Broadway," "The Bon Marche," and "Robinson's." 9 (Decl. of Anthony F. Lo Cicero ISO Mot. ("Lo Cicero Decl.")) Exs. Defendant has already obtained service mark registrations for ECF No. 56 United States District Court For the Northern District of California 10 A-C. Defendant's application to register the "Abraham & Straus" 11 mark is pending. 12 here (the "Marks") are names of well-known but now-defunct 13 department stores. Id. Ex. D. All of the service marks at issue See Am. Answer & Countercl. ¶ 15. 14 All four applications were filed as "intent to use" 15 applications pursuant to Lanham Act section 1051(b) and were 16 accordingly accompanied with Statements of Use ("SOU"). 17 Decl. Exs. E-H. 18 registration process under the Lanham Act before using the marks in 19 commerce, provided that the applicant shows a "bona fide intention 20 to use the mark in commerce at a later date." 21 Such applications are called "intent to use" applications, and 22 registration under these applications is granted if the applicant 23 files a verified statement of commercial use proving eventual use 24 of the mark in commerce. 25 may not file a statement of use until the applicant has made use of 26 the mark in commerce on or in connection with all services 27 specified in the notice of allowance. 28 (describing the USPTO's requirements for filing a statement of Lo Cicero A service mark applicant may begin the Id. § 1051(d). 2 15 U.S.C. § 1051(b). In general, an applicant See 37 C.F.R. § 2.88 1 use). Each of Defendant's SOUs affirms that, per Lanham Act 2 3 section 1051(b)'s requirements for service mark registration, 4 "[t]he mark is in use in commerce on or in connection with all 5 goods or services listed in the application." 6 E-H. 7 Defendant "is using the mark in commerce on or in connection with 8 the goods/services identified." 9 Specifically, each SOU identifies the services for which Defendant United States District Court For the Northern District of California 10 11 12 13 14 15 16 17 Lo Cicero Decl. Exs. Each SOU also contains a sworn, signed declaration that Lo Cicero Decl. Exs. E-H. claims to be using the Mark as: retail department store and on-line retail department store services retail and on-line retail clothing boutiques retail and on-line clothing stores retail and on-line retail apparel stores retail and on-line retail store services featuring clothing and fashion accessories Id. Exs. E-H. Each Mark's application is also accompanied by the requisite 18 Specimen of Use ("Specimen"), which provides proof of how Defendant 19 claims to be using the mark in commerce. 20 Specimens are screenshots taken from Defendant's website, "Retro 21 Department Stores" ( 22 Mark's Specimen is a screenshot of that Mark's sub-page, each of 23 which features the Mark on a t-shirt that the visitor can purchase 24 by clicking an "Add to Cart" button, a brief history of the Mark's 25 namesake department store, and, in some cases, a video clip of an 26 old commercial for that store. 27 28 Id. Exs. I-L. See id. The Each See id. Defendant's business, as described on its website, is meant to bring back some of "the great department stores of the 20th 3 1 century" by rebuilding and restoring "well-loved" department store 2 brands, including Robinson's May, The Broadway, The Bon Marche, and 3 Abraham & Straus. 4 its plan as follows, on Retro Department Stores' "About" page: Id. Ex. M. Specifically, Defendant described 5 You'll see these stores first as part of this "nostalgic" virtual mall. Then we plan to branch out with unique accessories at small boutiques, followed by exclusive apparel by up and coming designers, and then ultimately with actual "Brick and Mortar" stores throughout the United States with a full line-up of products. 6 7 8 9 United States District Court For the Northern District of California 10 11 Id. As to the factual dispute that forms the root of the instant 12 motion for summary judgment, Defendant never actually sold any 13 "unique accessories," "exclusive apparel," or other products, and 14 never opened any "small boutiques" or "Brick and Mortar" stores. 15 Plaintiffs claim that these facts render all of Defendants' 16 registrations void. 17 Defendant's preparatory activities or other work is sufficient to 18 satisfy the Lanham Act's requirements for "intent to use" 19 applications or use in commerce. 20 its evidence -- invoices from companies it says it retained to 21 build its website and provide merchandise, deposition testimony as 22 to employees' duties, and correspondence related to its work 23 publicizing its business -- satisfies the Lanham Act's 24 requirements, rendering Defendant's Marks presumptively valid and 25 capable of supporting Defendant's counter-claims against 26 Plaintiffs. Mot at 9-16. Plaintiff claims that none of See id. Defendant insists that See Opp'n at 2-8. 27 Plaintiffs now move for partial summary judgment as to 28 Defendant's counterclaims, arguing that there is no genuine issue 4 1 of material fact as to the invalidity of Defendant's Marks, thereby 2 rendering unsupportable Defendant's counterclaims for Plaintiff's 3 infringement of the Marks. 4 Plaintiffs' motion, arguing that genuine issues of material fact 5 exist as to the definition of Defendant's services and whether 6 Defendant used the Marks in commerce. Mot. at 9. Defendant opposes Opp'n at 3-7. 7 Entry of summary judgment is proper "if the movant shows that 10 United States District Court LEGAL STANDARD 9 For the Northern District of California 8 III. there is no genuine dispute as to any material fact and the movant 11 is entitled to judgment as a matter of law." 12 56(a). 13 require a directed verdict for the moving party. 14 Liberty Lobby, Inc., 477 U.S. 242, 251 (1986). 15 bears the initial burdens of production and persuasion. 16 Fire & Marine Ins. Co., Ltd. v. Fritz Companies, Inc., 210 F.3d 17 1099, 1102 (9th Cir. 2000). 18 Fed. R. Civ. P. Summary judgment should be granted if the evidence would Anderson v. The moving party Nissan "In order to carry its burden of production, the moving party 19 must either produce evidence negating an essential element of the 20 nonmoving party's claim or defense or show that the nonmoving party 21 does not have enough evidence of an essential element to carry its 22 ultimate burden of persuasion at trial." 23 its ultimate burden of persuasion on the motion, the moving party 24 must persuade the court that there is no genuine issue of material 25 fact." 26 party presents evidence from which a reasonable jury, viewing the 27 evidence in the light most favorable to that party, could resolve 28 the material issue in his or her favor. Id. Id. "In order to carry A genuine issue for trial exists if the non-moving 5 Anderson, 477 U.S. at 248- 1 49. The Ninth Circuit has instructed that "[b]ecause of the 2 3 intensely factual nature of trademark disputes, summary judgment is 4 generally disfavored in the trademark arena." 5 Rearden Commerce, Inc., 683 F.3d 1190, 1202 (9th Cir. 2012) 6 (quoting Interstellar Starship Servs., Ltd. v. Epix, Inc., 184 F.3d 7 1107, 1109 (9th Cir. 1999)); see also Levi Strauss & Co. v. Blue 8 Bell, Inc., 778 F.2d 1352, 1356 n.5 (9th Cir. 1985). Rearden LLC v. 9 United States District Court For the Northern District of California 10 IV. DISCUSSION 11 The Marks at issue here are service marks. 12 The Lanham Act provides the definition of a service mark: 13 The term "service mark" means any word, name, symbol, or device, or any combination thereof -(1) used by a person, or (2) which a person has a bona fide intention to use in commerce and applies to register . . . to identify and distinguish the services of one person, including a unique service, from the services of others and to indicate the source of the services, even if that source is unknown. 14 15 16 17 18 19 20 15 U.S.C. § 1127. 21 "trademark," but a trademark identifies goods, and a service mark 22 identifies intangible services. 23 Airflite, Inc., 560 F.3d 1350, 1356 (9th Cir. 2009). 24 A service mark is virtually identical to a Id.; Aycock Eng'g, Inc. v. Both trademarks and service marks are governed by the same 25 statutory criteria for registration and validity. Aycock, 560 F.3d 26 at 1357. 27 to registration under the Lanham Act. 28 be deemed to be in use in commerce . . . on services when it is One such criterion is the "use in commerce" prerequisite 6 Id. "In short, a mark shall 1 used or displayed in the sale or advertising of services and the 2 services are rendered in commerce." 3 (citing 15 U.S.C. § 1127) (internal quotation marks omitted). 4 requirement has two parts: "(1) an element of actual use, and (2) 5 an element of display." 6 1151, 1159 (9th Cir. 2001). 7 Rearden, 683 F.3d at 1204 This Chance v. Pac-Tel Teletrac, Inc., 242 F.3d In determining whether a service mark meets the Lanham Act's 8 use in commerce requirement, district courts within the Ninth 9 Circuit are to employ a "totality of the circumstances" test that United States District Court For the Northern District of California 10 considers not only the actual sales activity under the trademark or 11 service mark, but also non-sales activity: 12 In applying this approach, the district courts should be guided in their consideration of non-sales activities by factors we have discussed, such as [1] the genuineness and commercial character of the activity, [2] the determination of whether the mark was sufficiently public to identify or distinguish the marked service in an appropriate segment of the public mind as those of the holder of the mark, [3] the scope of the non-sales activity relative to what would be a commercially reasonable attempt to market the service, [4] the degree of ongoing activity of the holder to conduct the business using the mark, [5] the amount of business transacted, and [6] other similar factors which might distinguish whether a service has actually been "rendered in commerce." 13 14 15 16 17 18 19 20 21 22 Chance, 242 F.3d at 1159. Actual sales of a service, while 23 important, are therefore not required for a service mark to meet 24 the "use in commerce" requirement, though at the other end of the 25 spectrum, mere advertisement or preparation for use does not 26 suffice. 27 Commc'ns, Inc. v. West Coast Entm't Corp., 174 F.3d 1036, 1052 (9th 28 Cir. 1999). See id.; see also Rearden, 683 F.3d at 1204; Brookfield Moreover, once a mark has been federally registered, 7 1 there attaches a prima facie presumption of validity that can be 2 rebutted by a preponderance of evidence showing invalidity. 3 Brookfield, 174 F.3d at 1047. See 4 Keeping in mind the Ninth Circuit's instruction that the 5 "intensely factual nature of trademark disputes" means that summary 6 judgment "is generally disfavored in the trademark arena," Rearden, 7 683 F.3d at 1202, and drawing all inferences in the non-movant 8 Defendant's favor, the Court finds that there are genuine, disputed 9 issues of material fact as to the definitions of Defendant's United States District Court For the Northern District of California 10 services. 11 the parties' dispute over the definitions of "retail" and "on-line" 12 in Defendant's SOUs could reasonably be resolved in favor of either 13 party. 14 See, e.g., Opp'n at 2-4; Reply at 9-12. Specifically, See Nissan Fire, 210 F.3d at 1102. The Court also finds that there are genuine, disputed issues 15 concerning whether, under the Ninth Circuit's "totality of 16 circumstances" standard, Defendant's sales- and non-sales-related 17 activities meet the "use in commerce" requirement for service mark 18 registration. 19 all of the evidence concerning Defendant's Marks and the Retro 20 Department Stores website, as well as the USPTO's ongoing office 21 action concerning the validity of the "Abraham & Straus" Mark, 22 makes clear that Defendant's activities concerning the Marks 23 pertain to possible future uses, and that Defendant has never 24 actually rendered any services under the Mark. 25 Reply at 12-14. 26 activities in their totality are cognizable preparatory activities 27 under the Lanham Act, and that its on-line activities were indeed 28 uses in commerce. See Chance, 242 F.3d at 1159. Plaintiffs argue that See Mot. at 9-14; Defendant responds in relevant part that its See Opp'n at 3-8. 8 Based on the evidence that 1 the parties provided, as rwell as the arguments in their briefs, 2 the Court finds that Plaintiffs fail to meet their burden on these 3 points as well. In total, Plaintiffs have not persuaded the Court that there 4 5 are no material issues of fact for trial. A reasonable jury, 6 reviewing the evidence that the parties have provided up to this 7 point and regarding the evidence in the light most favorable to 8 Defendant, could resolve the instant matter in Defendant's favor. 9 Anderson, 477 U.S. at 248-49. United States District Court For the Northern District of California 10 11 12 V. CONCLUSION For the reasons described above, the Court DENIES Plaintiffs 13 Macy's, Inc. and, Inc.'s motion for summary judgment 14 against Defendant Strategic Marks, LLC. 15 16 IT IS SO ORDERED. 17 18 19 Dated: March ___, 2013 19 UNITED STATES DISTRICT JUDGE 20 21 22 23 24 25 26 27 28 9

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