ROBERT H. CLELAND, District Judge.
Now before the court is a Motion for Partial Judgment on the Pleadings brought by Defendant R+L Carriers, Inc. ("R+L"). (Dkt. # 14.) The motion has been fully briefed and the court concludes that a hearing is unnecessary. See E.D. LR 7.1(f)(2). For the reasons stated below, the court will grant Defendant's Motion.
On October 30, 2015, Plaintiff XPO Logistics, Inc. ("XPO") acquired Con-way, Inc., a family of companies that included Con-way Freight. (Dkt. # 1, Pg. ID 6.) This case arises out of the efforts of Defendant R+L, a Con-way competitor, to recruit and hire employees of Con-way who were laid off or at risk of being laid off following the acquisition.
While the exact timing is disputed, all parties agree that within two days of the acquisition, R+L launched a website targeting Con-way's employees: "www.conwaylayoff.com." (Dkt. # 1, Pg. ID 6; Dkt. # 14, Pg. ID 215.) The website included the following statement:
(Dkt. # 1-7, Pg. ID 48-49.)
On November 3, 2015, R+L issued a press release announcing the launch of the website, warning that "[w]hile no layoffs were officially announced [by Con-way], during negotiations, XPO management was clear it would eliminate redundancies and look for other ways to `leverage' divisions of the combined companies." (Dkt. # 1-2, Pg. ID 31.) Truckers News, a national publication for freight employees, then ran a story about the website, quoting portions of R+L's press release. The very next day, "Plaintiffs sent Defendant R&L [sic] a letter demanding Defendant remove the Website and cease and desist all raiding, targeting and other solicitation of Plaintiffs' employees through unlawful means or for unlawful purposes." (Dkt. # 1, Pg. ID 7; see also, Dkt. # 14.) R+L complied, removing the website on November 6, 2015. (Dkt. # 1, Pg. ID 12.)
Plaintiffs then brought this action, alleging among other things, that the website unlawfully used Plaintiffs' registered trademarks "CON-WAY" (Registration No. 2,278,192) and "CON-WAY FREIGHT" (Registration No. 4,286,252) in violation of the Lanham Act and that the domain name "www.conwaylayoff.com" constituted a violation of the Anti-Cybersquatting Consumer Protection Act. (Dkt. # 1.) In response, R+L filed the current Motion. (Dkt. # 14.)
Motions under 12(c) are adjudicated under the same legal standard as those under Rule 12(b)(6). Lindsay v. Yates, 498 F.3d 434, 437 n.5 (6th Cir. 2007). Under Rule 12(b)(6), the court may dismiss a complaint if it "fail[s] to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). Rule 12(b)(6) "`allow[s] a defendant to test whether, as a matter of law, the plaintiff is entitled to legal relief even if everything in the alleged complaint is true.'" Bagsby v. Gehres, 225 F. App'x 337, 355 (6th Cir. 2007) (quoting Mayer v. Mylod, 988 F.2d 635, 638 (6th Cir.1993)). Accordingly, the court must view the complaint in "the light most favorable to plaintiffs" by accepting all the allegations in it as true while drawing "all reasonable inferences . . . in favor of plaintiffs." Rondigo, 641 F.3d at 680 (citing Bassett, 528 F.3d at 430). "However, `a legal conclusion couched as a factual allegation' need not be accepted as true." Id. (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)).
In order to "provide the grounds of [their] claimed entitlement to relief," Plaintiffs must offer "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. Rather, Plaintiffs' complaint needs to include "`enough factual matter' that, when taken as true, `state[s] a claim to relief that is plausible on its face.'" Fabian v. Fulmer Helmets, Inc., 628 F.3d 278, 280 (6th Cir. 2010) (quoting Twombly, 550 U.S. at 556, 570) (alteration in original). "Plausibility requires showing more than the `sheer possibility' of relief but less than a `probab[le]' entitlement to relief." Fabian, 628 F.3d at 280 (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)) (alteration in original). Pleading "facts that are `merely consistent with' a defendant's liability" is not enough to cross the "`line between possibility and plausibility of entitlement to relief.'" Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 557). A complaint can only survive a motion to dismiss if it has "factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (citing Twombly, 550 U.S. at 570). Ultimately, "determining whether a complaint states a plausible claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679.
While Plaintiffs have alleged a number of both federal and state claims against various Defendants, R+L seeks summary dismissal of just two: Count I—Trademark Infringement and Count II—Violation of the Anti-Cybersquatting Consumer Protection Act ("ACPA"). (Dkt ## 1, 14.) Both causes of action will be addressed in turn.
First, Plaintiff's Complaint asserts a cause of action for trademark infringement under the Lanham Act. The Lanham Act provides:
15 U.S.C. § 1125(a).
"The Lanham Act is constitutional because it only regulates commercial speech, which is entitled to reduced protections under the First Amendment." Taubman Co. v. Webfeats, 319 F.3d 770, 774 (6th Cir. 2003) (citing Central Hudson Gas & Elec. Corp. v. Public Serv. Comm'n of N.Y., 447 U.S. 557, 563 (1980)). The Sixth Circuit has therefore held that the first inquiry under the Lanham Act is whether the defendant's "use is commercial and therefore within the jurisdiction of the Lanham Act, worthy of lesser First Amendment protections." Id. If the defendant's use "is commercial, then, and only then, do we analyze his use for a likelihood of confusion. If [the defendant's] use is also confusing, then it is misleading commercial speech, and outside the First Amendment." Id. at 774-75. "Hence, as per the language of the Lanham Act, any expression embodying the use of a mark not `in connection with the sale . . . or advertising of any goods or services,' and not likely to cause confusion, is outside the jurisdiction of the Lanham Act and necessarily protected by the First Amendment." Id. at 775; see also Bosley Medical Institute, Inc. v. Kremer, 403 F.3d 672, 676-77 (9th Cir. 2005) ("The Supreme Court has made it clear that trademark infringement law prevents only unauthorized uses of a trademark in connection with a commercial transaction in which the trademark is being used to confuse potential consumers.").
R+L advances several independent theories to argue that it is entitled to judgment on the pleadings with respect to this claim: (1) "R+L did not use the Con-way marks in commerce" (Dkt. # 14, Pg. ID 219 (emphasis omitted); (2) "R+L used the Conway marks in a non-trademark way" (Id. at Pg. ID 221 (emphasis omitted); and (3) "R+L use of the Con-way marks was a protected fair use" (Id. at Pg. ID 223). The court need address only the first two.
For purposes of the Lanham Act, Congress has defined the term "in commerce" to mean "in connection with the sale, offering for sale, distribution, or advertising of any goods or services." 15 U.S.C. § 114(1); see also Taubman Co., 319 F.3d at 774. The Sixth Circuit has held that this is a "strict liability" test and that the subjective intent of the infringing party is irrelevant. Taubman, 319 F.3d at 775. Even "extremely minimal" commercial activity, such as providing a link to a third-party website that sells goods, can trigger liability. Id.
Defendants claim that "Plaintiffs do not and cannot plead that the Website sells, distributes or advertises any goods or services, or that the Website provided links that sold, distributed or advertised goods or services." (Dkt. # 14, Pg. ID 220). The court is unpersuaded. While the bulk of the website does focus on recruiting potential employees, it is undisputed that it also contained the following descriptive paragraph:
(Dkt. # 1-7, Pg. ID 50.) Plaintiffs argue that this description constitutes an "advertisement[] for R+L's services." (Dkt. # 21, Pg. ID 283.) The court agrees. The invitation to visit R+L's commercial website alone is enough to clear the "extremely minimal" bar set by the Sixth Circuit with respect to commercial activity. Taubman, 319 F.3d at 775.
Having concluded that R+L used Plaintiffs' registered trademarks "in connection with the . . . advertising of . . . services," the court must determine whether such use of the disputed mark "is likely to cause confusion" among consumers "as to the origin . . . of [R+L's] services." 15 U.S.C. § 114(1). This is "[t]he touchstone of liability [for trademark infringement.]" Hensley Mfg. v. ProPride, Inc., 579 F.3d 603, 610 (6th Cir. 1997). As a threshold question, courts ask whether the defendants "are using the challenged mark in a way that identifies the source of their [services]." Interactive Products Corp. v. a2z Mobile Office Solns., Inc., 326 F.3d 687, 695 (6th Cir. 2003). "If they are not, then the mark is being used in a `non-trademark way' and trademark infringement laws . . . do not apply." Hensley, 579 F.3d at 610.
While Plaintiffs allege that "Con-way's trademarks as used by Defendant R&L [sic] . . . so resemble Plaintiffs' marks, as to be likely to induce the belief, contrary to fact, that the marks appearing on the Website were genuine and used with the sponsorship, license and/or approval of Plaintiffs" (Dkt. # 1, Pg. ID), the screen shot of the website attached to Plaintiffs' own Complaint contradicts this claim, (Dkt. # 1-7). The website clearly states that "R+L Carriers"—not Con-way, Con-way Freights, or XPO—"launched Conwaylayoff.com to inform those employees that may have been affected by the recent acquisition of Con-way Freight, of similar opportunities that we have where they may be able to put their skills to work." (Id. at Pg. ID 48-49 (emphasis added).) From this context, it is clear that Defendants actually did the exact opposite of that which is prohibited by law: it used the disputed marks to distinguish itself and its services from those of Plaintiffs, not confuse them. In this respect, the case is not unlike Dow Corning Corp. V. Xiao, No. 11-10008, 2011 WL 2015517, at *8 (E.D. Mich. May 20, 2011) (Ludington, J.), where the court found that a defendant's use of a competitor's trademarked name to compare plaintiffs' products with their own constituted a nontrademark use of that mark that could not create confusion. See also Kassa v. Detroit Metro Convention & Visitors Bureau, 150 F.Supp. 831, 839 (E.D. Mich. 2015) (Leitman, J.) ("Binding [Sixth Circuit case law] makes clear that where, as here, a plaintiff's own allegations show that a defendant used a mark in a non-trademark way, the plaintiff cannot establish a likelihood of confusion, and his federal trademark infringement claim should be dismissed.").
The court will grant R+L's Motion on this basis.
The ACPA provides, in relevant part:
15 U.S.C. § 1125(d)(1)(A).
In order to establish a "cybersquatting" claim under the ACPA, Plaintiff must establish: (1) it has a valid trademark entitled to protection; (2) its mark is distinctive or famous; (3) Defendants' Domain Names are identical or confusingly similar to, or in the case of famous marks, dilutive of, Plaintiff's mark; and (4) Defendants used, registered, or trafficked in the domain name (5) with a bad faith intent to profit. DaimlerChrysler v. The Net Inc., 388 F.3d 201, 204 (6th Cir. 2004) (citing Ford Motor Co. v. Catalanotte, 342 F.3d 543, 546 (6th Cir. 2003)). Here, Plaintiff's case fails because it has provided no evidence that Defendants used the Domain Names with a bad faith intent to profit.
The ACPA lists several factors a court may consider in determining whether a person has a bad faith intent, including:
15 U.S.C. § 1125(d)(1)(B). Courts "are not limited to considering just the listed factors when making [the] determination of whether the statutory criterion has been met. The factors are, instead, expressly described as indicia that `may' be considered along with other facts." Sporty's Farm L.L.C. v. Sportsman's Market, Inc., 202 F.3d 489, 498 (2d Cir. 2000) (citing 15 U.S.C. § 1125(d)(1)(B)(i)). "The role of the reviewing court is not simply to add factors and place them in particular categories, without making some sense of what motivates the conduct at issue. The factors are given to courts as a guide, not as a substitute for careful thinking about whether the conduct at issue is motivated by a bad faith intent to profit." Lucas Nursery and Landscaping, Inc. v. Grosse, 359 F.3d 806, 811 (6th Cir. 2004).
In Lucas Nursery, the defendant, who was dissatisfied with the services provided by the plaintiff's landscaping business, registered the domain name "lucasnursery.com" to complain about the plaintiff's company. The Sixth Circuit balanced the relevant "bad faith intent" factors listed above and found:
Id. at 810.
Here, it is undisputed that R+L set up a website and used Plaintiffs' trademark in the domain name. But, as in Lucas Nursery, this alone is insufficient to establish that R+L operated in bad faith. Plaintiffs have not alleged that R+L ever offered to sell "www.conwaylayoff.com" to Plaintiffs, nor have they alleged that R+L has acquired other suspect domain names. Instead, Plaintiffs offer the court a bare bones recital of the statutory language, stating that (1) "Defendant R&L [sic] has registered and has used "www.conwaylayoff.com" without Plaintiffs' authorization and with bad faith to profit from Plaintiffs' trademark" and (2) that the "infringing domain name . . . directed or redirected to an authorized website controlled by Defendant R&L [sic], which profited from its use." (Dkt. # 1, Pg. ID 13-14.) This is insufficient to survive the Twombly standard. Because Plaintiffs have failed to adequately plead bad faith, the court will grant R+L's Motion with respect to the ACPA claim, as well.
IT IS ORDERED that Defendant R+L's Motion for Partial Judgment on the Pleadings (Dkt. # 14) is GRANTED.