THOMAS D. SCHROEDER, District Judge.
Before the court is the motion of Plaintiffs Rebel Debutante LLC ("Rebel Debutante") and Anna Stubblefield, a/k/a Anna Fields ("Stubblefield") to preliminarily and permanently enjoin Defendant Forsythe Cosmetic Group, Ltd. ("Forsythe") from using or displaying the mark "Rebel Debutante," to require Forsythe to recall, destroy or deliver to the court the allegedly offending goods using that mark or similar mark, and for other relief ("Motion"). (Doc. 7.) Defendant Forsythe moves to transfer this case to the Southern District of New York ("Motion to Transfer") (Doc. 21), which Plaintiffs oppose (Doc. 24). Following briefing by the parties and an evidentiary hearing, the matter is ripe for resolution.
Stubblefield, a performer, screenwriter, playwright and author, began publishing her writing on the Internet in 2006 at www.rebeldebutante.com and later on the blogs www.rebeldebutante.blogspot.com and www.annafields.net. (Doc. 8-1, Stubblefield Decl. ¶¶ 2-5.) This writing, presumably beginning in 2006 on www.rebeldebutante.com, introduced her moniker "Rebel Debutante." Stubblefield, in her briefing, describes herself as "the eponymous Rebel Debutante, a woman with a traditional Southern background who was born and raised in North Carolina before moving to Los Angeles to begin a career in the entertainment industry." (Doc. 8 at 2.) She claims to have "coined" the term "Rebel Debutante" "to refer to a personal style and approach to fashion, society and life flowing out of her experiences growing up in, and rebelling against, Southern society." (Id.)
In March 2008, Stubblefield contracted with G.P. Putnam's Sons to author a book entitled "Confessions of a Rebel Debutante." (Doc. 8-1, Stubblefield Decl. ¶ 5.) The book appeared in hardcover on April 15, 2010, and as of the date of Stubblefield's declaration sold over 25,000 copies. A paperback version was released in February 2011. Stubblefield toured nationwide to promote the book and is at work on follow-on books. (Id. ¶¶ 6-8.)
On October 16, 2008, Stubblefield filed a Trademark/Service Mark Application with the United States Patent and Trademark Office ("USPTO") for the mark "REBEL DEBUTANTE." Her application and "Trademark/Service Mark Statement of Use" listed "use information" as "clothing, namely, t-shirts, shirts, tank tops, pants, shorts, underwear, hooded sweat shirts, [and] tube tops," and the Statement of Use stated that the mark "is in use in commerce on or in connection with all goods or services listed in the application or Notice of Allowance or as subsequently modified for this specific class." (Docs. 46-2, 46-3.) The USPTO issued U.S. Trademark Registration No. 3,703,222 for the trademark "REBEL DEBUTANTE" on October 27,
In December 2008, Stubblefield and a business partner formed Rebel Debutante. Rebel Debutante is the sole licensee of the "Rebel Debutante" mark. (Doc. 8-1, Stubblefield Decl. ¶ 9.) The company offers, as described by Stubblefield, "fashion-oriented products for young women, including tank tops, T-shirts, long-sleeved shirts, jackets, intimate apparel, and jewelry," all sold under the "Rebel Debutante" mark. According to Stubblefield's declaration, over $10,000 worth of "Rebel Debutante" clothing and merchandise has been sold through the website www.rebeldebutante.com.
Forsythe is a New York corporation that has manufactured nail polishes since 1979; it sells its products through distributors and "does not typically sell directly to either customers or retailers." (Doc. 20-2, Rose Decl. ¶¶ 3, 11, 14.) Forsythe contends that it first considered using the phrase "Rebel Debutante" in November 2009, and actually began using the name on products "at least as early as January 2010" as part of its Spring 2010 collections of nail polish sold under its registered mark "Color Club." (Id. ¶¶ 6-7; Doc. 45, Rose Decl. ¶ 3; see Doc. 46-1.) The "Color Club" collection name is displayed in advertising, including on the Internet, point-of-sale displays, and packaging. (See Doc. 20-1, Rose Decl. ¶¶ 5-7 (describing "Rebel Debutante" marketing under "Color Club"); Doc. 8-12 (Internet advertisement); 4/29/11 Hearing, Plaintiff's Ex. 2 (point-of-sale display).) Forsythe represents that its "Rebel Debutante" collection was not intended to be a permanent collection, has been discontinued, and is no longer offered for sale or advertised. References to the collection or color name "Rebel Debutante" no longer appear on Forsythe's cosmeticgroup.com website. (Doc. 45, Rose Decl. ¶ 4.) Although the collection was known as "Rebel Debutante" and every bottle bore the "Color Club" trademark, only one of the colors in the collection bore the "Rebel Debutante" mark. (Id. ¶ 6.) Forsythe represents it derived $46,745 in profits from sales of the "Color Club" product bearing the "Rebel Debutante" mark. (Id.)
Stubblefield demanded that Forsythe cease and desist from further use of the phrase "Rebel Debutante" by letter dated September 1, 2010. (Doc. 8-16.) Forsythe responded, promising to investigate and "respond shortly." (Doc. 8-17.) However, Forsythe did not respond, and Stubblefield contacted Forsythe again on December 3, 2010. (Doc. 8-18.) Forsythe finally responded on December 13, 2010, and denied any wrongdoing. (See Doc. 8-19.) The last of this correspondence, from Forsythe, appears to have occurred on January 7, 2010, in a letter in which Forsythe's counsel discounted any likelihood of confusion because the goods sold by Forsythe and those in Stubblefield's trademark registration "are not related and they are characterized by the USPTO in different international classes." (Doc. 8-20.)
Stubblefield brought this action on February 10, 2011, claiming that Forsythe infringes and dilutes
Prior to considering Stubblefield's Motion for injunctive relief, the court turns first to Forsythe's Motion to Transfer the case to the Southern District of New York.
Forsythe moves to transfer this case to the Southern District of New York pursuant to 28 U.S.C. § 1404(a), arguing that the case is a dispute between two New York parties involving New York evidence and New York witnesses. (Doc. 21 at 4.) Stubblefield disputes this characterization, noting that Rebel Debutante is a North Carolina corporation based in Winston-Salem, and she testified that she moved to North Carolina in August 2009 and is a full-time law student at Wake Forest Law School in Winston-Salem. (Doc. 24 at 1; Doc. 24-1, Stubblefield Aff., Ex. 5.) Forsythe, in turn, points to media reports quoting Stubblefield as "maintain[ing] significant ties to New York" and to her trademark application listing a New York City address for Rebel Debutante's office to contend that this dispute involves significant contacts in New York. (Doc. 25 at 1.)
Section 1404(a) provides that "[f]or the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought." 28 U.S.C. § 1404(a). The court undertakes a two-step process in determining whether to transfer a case pursuant to section 1404(a). First, section 1404(a) requires that the lawsuit could have been brought in the district or division to which transfer is sought. Because Stubblefield asserts causes of action under the Lanham Act, which would establish federal jurisdiction generally, and Forsythe is organized under the laws of the State of New York with its offices and manufacturing facilities based there (Doc. 20-2, Rose Decl. ¶ 3), this action could have been brought in the Southern District of New York.
Second, the court determines whether transfer is warranted. In considering a motion to transfer, a court should weigh the following discretionary factors:
Speed Trac Techs., Inc. v. Estes Express Lines, Inc., 567 F.Supp.2d 799, 802 (M.D.N.C.2008). The party moving to transfer, in this case Forsythe, bears the burden of proving that the balance favors transfer. Id. at 803. A plaintiff's choice of forum is given considerable weight and, "unless the balance is strongly in favor of the defendant, the plaintiff's choice of forum should rarely be disturbed."
Forsythe points to Stubblefield's listing of a New York address on her August 26, 2009, trademark statement of use and to evidence that she maintained a presence in New York, including rental of a New York apartment, well into 2010. Forsythe also produced March 2011 printouts of websites maintained by Stubblefield that listed her as a "New York based" television writer, author, comedienne and Reluctant (as well as Rebel) Debutante. (Doc. 22-1, Exs. A-B.) Finally, Forsythe relies on transcripts of April 2010 interviews of Stubblefield in which she stated she spent half the year in New York City and half the year in Winston-Salem (Doc. 25-1, Exs. A-C, E-G; 4/29/11 Hearing), as well as a September 2010 interview transcript in which she is reported to have said that "I'm in Carolina right now but I do go back and forth to New York and LA because I'm writing a movie for the book." (Doc. 25-1, Ex. D.)
At the April 29, 2011 hearing, Stubblefield testified that after moving to North Carolina in 2009, she divided her time between the state and New York primarily to spend weekends with her boyfriend, until he moved to North Carolina in April 2010. She also testified that she had given "hundreds" of interviews and characterized her statements of New York ties as "hyperbole." Finally, she stated that the information on her website blog was simply outdated and, although the New York lease was in her name, her boyfriend lived there and paid the rent.
It is not apparent that Plaintiffs' Lanham Act claims reflect a localized New York controversy. Forsythe's products are sold nationwide, primarily through distributors. Moreover, Forsythe claims that only a handful of its employees were involved in any relevant way in the matters at issue, and the record indicates that Forsythe relied principally on two consultants in California to identify the "Rebel Debutante" name for its use and to undertake related commercial artwork. (See Doc. 34-5, Rose Decl. ¶¶ 9-10.) Thus, it is not apparent that Forsythe would bear an unfair burden in responding to discovery or that all significant discovery would be limited to New York. Indeed, that Forsythe's employees are located in New York burdens Plaintiffs, who appear willing to accept it. Insofar as Rebel Debutante is closely tied to Stubblefield, located in North Carolina, and has few, if any, employees, any travel burden imposed on Forsythe by the venue appears minimal.
As to the counsel argument, under the oft-applicable "goose/gander" rule, it bears noting that moving the case to New York would cause Plaintiffs to retain local counsel and thereby simply reverse the burden of most of the alleged counsel and discovery costs of which Forsythe complains. The remaining factors are neutral.
In summary, in balancing all the relevant factors the court concludes that Forsythe has not demonstrated that the convenience of the parties and witnesses and the interests of justice weigh in favor of transferring this action to the Southern District of New York. Consequently, Forsythe's Motion to Transfer (Doc. 21) will be denied.
Forsythe asserts as a preliminary matter that the need for an injunction, preliminary or permanent, is moot because it has discontinued its Rebel Debutante line, no longer markets or sells the product, and does not intend to use the mark in the future. (Doc. 44 at 2-3, 5; Doc. 50 at 2-3; see Doc. 45, Rose Decl. ¶ 4.) Plaintiffs argue that Forsythe's assertions should not be accepted, particularly since it is capable of resuming production.
Once a defendant has stopped marketing a product that allegedly infringes on a protected mark, an injunction may be unnecessary when "there is no reasonable expectation that the wrong will be repeated." Lyons P'ship, L.P. v. Morris Costumes, Inc., 243 F.3d 789, 800 (4th Cir.2001) (quoting United States v. W.T. Grant Co., 345 U.S. 629, 633, 73 S.Ct. 894, 97 L.Ed. 1303 (1953)). A defendant, however, "face[s] a heavy burden to establish mootness in such cases because otherwise they would simply be free to `return to [their] old ways' after the threat of a lawsuit has passed." Id. (quoting Iron Arrow Honor Soc'y v. Heckler, 464 U.S. 67, 72, 104 S.Ct. 373, 78 L.Ed.2d 58 (1983)). Bald assertions by a defendant that it will not start up again are not enough to carry this heavy burden. "In the context of an infringement action, such assertions, standing alone, cannot eliminate the plaintiff's `reasonable expectation that the alleged violation will recur' in the absence of a court order." Id. at 800-01 (remanding with instructions that district court enter an injunction).
Even when a defendant has ceased production, it has not met its "heavy burden" unless it shows that it would be unable to resume production in the future. Lance Mfg., LLC v. Voortman Cookies Ltd., 617 F.Supp.2d 424 (W.D.N.C.2009) (granting preliminary injunction; also expressing concern about products still in the marketplace); cf. Lorillard Tobacco Co. v. S & M Brands, Inc., 616 F.Supp.2d 581, 586 (E.D.Va.2009) (noting that defendant continued to challenge whether the mark was infringed and granting preliminary injunction on initial advertisements).
A preliminary injunction is "an extraordinary remedy . . . which is to be applied only in [the] limited circumstances which clearly demand it." Direx Israel, Ltd. v. Breakthrough Med. Corp., 952 F.2d 802, 811 (4th Cir.1991) (internal quotation marks omitted) (citation omitted). The traditional purpose of a preliminary injunction is to "protect the status quo and to prevent irreparable harm during the pendency of a lawsuit ultimately to preserve the court's ability to render a meaningful judgment on the merits." In re Microsoft Corp. Antitrust Litig., 333 F.3d 517, 525 (4th Cir.2003). Before a court may enter a preliminary injunction, a plaintiff "must establish [1] that he is likely to succeed on the merits, [2] that he is likely to suffer irreparable harm in the absence of preliminary relief, [3] that the balance of equities tips in his favor, and [4] that an injunction is in the public interest." WV Ass'n of Club Owners & Fraternal Servs., Inc. v. Musgrave, 553 F.3d 292, 298 (4th Cir.2009) (quoting Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 129 S.Ct. 365, 172 L.Ed.2d 249 (2008)). The burden is on the party seeking a preliminary injunction to demonstrate by a "clear showing" that she is entitled to such relief. See, e.g., The Real Truth About Obama, Inc. v. Fed. Election Comm'n, 575 F.3d 342, 345-46 (4th Cir.2009) (citing Winter, 555 U.S. 7, 129 S.Ct. at 375-76, with respect to likelihood of success on the merits at trial and irreparable injury), vacated on other grounds, ___ U.S. ___, 130 S.Ct. 2371, 176 L.Ed.2d 764 (2010), restated in relevant part on remand, 607 F.3d 355 (4th Cir. 2010) (per curiam). Each requirement will be examined in turn.
To prove trademark infringement, Stubblefield must show that she owns a valid and protectable mark, Forsythe used a "re-production, counterfeit, copy, or colorable imitation" of that mark in commerce and without Stubblefield's consent, and use of the mark is likely to cause confusion. Louis Vuitton Malletier S.A. v. Haute Diggity Dog, LLC, 507 F.3d 252, 259 (4th Cir.2007). To obtain a preliminary injunction, Stubblefield must show a likelihood of success with respect to each of these elements. See Lorillard, 616 F.Supp.2d at 590.
Stubblefield applied with the USPTO for registration of "Rebel Debutante" on October 16, 2008. USPTO issued a registration certificate on October 27, 2009.
To ascertain whether a trademark is protected, the court must determine whether the mark is (1) generic, (2) descriptive, (3) suggestive, or (4) arbitrary or fanciful. U.S. Search, LLC v. U.S. Search.com Inc., 300 F.3d 517, 523 (4th Cir.2002). Suggestive as well as arbitrary and fanciful marks are deemed inherently distinctive and receive the greatest amount of protection. Id. A suggestive mark consists of words that connote, rather than describe, some quality or characteristic of a product or service. A descriptive mark may be eligible for protection but only if it has acquired a "secondary meaning" in the
A certificate of registration is prima facie evidence of the validity of the mark, ownership by the registrant, and proper registration under the Lanham Act. Brittingham v. Jenkins, 914 F.2d 447, 452 (4th Cir.1990) (citing 15 U.S.C. § 1057(b)); see 15 U.S.C. § 1115(a). Because the USPTO did not require Stubblefield to establish a "secondary meaning" before it granted registration, the USPTO did not consider the mark either generic or merely descriptive, which would not be protected. Rather, in this case, the grant of the registration is prima facie evidence that the mark is suggestive (or fanciful or arbitrary). See Synergistic Int'l, LLC v. Korman, 470 F.3d 162, 172 (4th Cir.2006); Lone Star Steakhouse & Saloon, Inc. v. Alpha of Va., Inc., 43 F.3d 922, 934 (4th Cir.1995). Further, the "Rebel Debutante" mark is entitled to a presumption of validity and Stubblefield of ownership. 15 U.S.C. § 1115(a); see Brittingham, 914 F.2d at 452 (citing 15 U.S.C. § 1115(a)). Because "Rebel Debutante" has not been in continuous use for five consecutive years following registration, registration is not "conclusive" evidence and therefore not incontestable by Forsythe under the Lanham Act. See 15 U.S.C. §§ 1115(b) ("Incontestability"), 1065 ("Incontestability of right to sue mark under certain conditions"); cf. Korman, 470 F.3d at 166 (citing 15 U.S.C. § 1065 in context of mark satisfying incontestability requirements).
Forsythe contests the validity of Stubblefield's registration in its counterclaims and by affirmative defense. (Doc. 40 at 10, 13-17; see Docs. 44 at 3 n. 1, 46-3, 46-4, 46-5, 46-6.) The presumption of validity does not preclude one charged with infringement from collaterally attacking the trademark either by way of an affirmative defense or by way of a counterclaim seeking cancellation of the registration if the mark has not become incontestable under § 1065. Pizzeria Uno Corp. v. Temple, 747 F.2d 1522, 1529 (4th Cir.1984) (citing 15 U.S.C. § 1115(a)). In challenging the presumption, Forsythe must introduce sufficient evidence, by a preponderance, to rebut the presumption of Stubblefield's right to exclusive use. Id. at 1529 & n. 4.
Forsythe, which has produced little evidence in support of its challenge at this time, has not carried its burden of introducing sufficient evidence to rebut the presumption. Further, the term "Rebel Debutante" on its face appears suggestive, juxtaposing two words not typically associated with one another, that is, the formal, reserved debutante with rebelliousness. Therefore, the court concludes that Stubblefield has demonstrated a likelihood of success on this element.
Stubblefield presented evidence of Forsythe's use of the mark "Rebel Debutante" in commerce, consisting primarily of Forsythe's own advertisements and product displays using the term "Rebel Debutante" in connection with the sale of nail polish. (E.g., Doc. 8-12; 4/29/11 Hearing, Plaintiff's Exs. 1-2.) Stubblefield also presented evidence, including letters between the parties prior to litigation, demonstrating that Stubblefield did not consent to use
Stubblefield must show that Forsythe's use of the mark occurred in a manner likely to cause confusion. At the preliminary injunction stage, however, a plaintiff need only show he or she is likely to show a likelihood of confusion with respect to this element. See WCVB-TV v. Boston Athletic Ass'n, 926 F.2d 42, 44 (1st Cir. 1991) ("Unless a plaintiff can convince a district court that it will likely show such a `likelihood of confusion' on the merits of its trademark claim . . . it is not entitled to a preliminary injunction."). "The test is likelihood of confusion; evidence of actual confusion is unnecessary." Sara Lee Corp. v. Kayser-Roth Corp., 81 F.3d 455, 463 (4th Cir.1996); see Louis Vuitton, 507 F.3d at 263 (noting that it is "well established that no actual confusion is required to prove a case of trademark infringement").
To ascertain the likelihood of confusion between two trademarks, courts consider a number of factors, including the following: (1) the strength or distinctiveness of plaintiff's mark; (2) the similarity of the two marks; (3) the similarity of the goods or services that the marks identify; (4) the similarity of the facilities used by the parties in conducting their businesses; (5) the similarity of the advertising used by the parties; (6) the defendant's intent in using the same or similar mark; (7) actual confusion; (8) the proximity of the products as they are actually sold; (9) the probability that the senior mark owner will "bridge the gap" by entering the defendant's market; (10) the quality of the defendant's product in relation to the mark owner's product; and (11) the sophistication of the consuming public. Shakespeare Co. v. Silstar Corp. of Am., Inc., 110 F.3d 234, 241-42 (4th Cir.1997); Sara Lee, 81 F.3d at 463-64; Pizzeria Uno, 747 F.2d at 1527. This list "is neither exhaustive nor exclusive, and some of the factors may not always be relevant or equally emphasized in each case." Shakespeare, 110 F.3d at 242; see Sara Lee, 81 F.3d at 463 (noting that "though several factors are simultaneously present, some factors may, depending on the case, be more important than others"). Each factor will be considered in turn.
In assessing this factor, the court examines "the strength or distinctiveness of the plaintiff's mark as actually used in the marketplace." CareFirst of Md., Inc. v. First Care, P.C., 434 F.3d 263, 269, 271 (4th Cir.2006); accord Ga. Pac. Consumer Prods., LP v. Von Drehle Corp., 618 F.3d 441, 454 (4th Cir.2010) (citing George & Co., infra); George & Co. LLC v. Imagination Entm't Ltd., 575 F.3d 383, 393 (4th Cir.2009) (citing Pizzeria Uno). As the Fourth Circuit has observed, "[i]n conducting the likelihood-of-confusion analysis, a court does not `indulge in a prolonged and minute comparison of the conflicting marks in the peace and quiet of judicial chambers, for this is not the context in
The "strength" of a mark is the "degree to which a consumer in the relevant population, upon encountering the mark, would associate the mark with a unique source." Id. at 269. The strength is evaluated in terms of the mark's "conceptual strength and commercial strength." Id. Measuring the mark's conceptual (or inherent) strength focuses on the linguistic or graphical peculiarity of the mark. Id. As noted, courts have classified marks into four groups in an ascending order of strength or distinctiveness: (1) generic; (2) descriptive; (3) suggestive; and (4) arbitrary or fanciful. Pizzeria Uno, 747 F.2d at 1527. This factor obviously relates to validity of the trademark itself as well.
As this court concluded, the term "Rebel Debutante" is more aptly classified as suggestive than descriptive. The juxtaposition of the words implies a distinctive concept of a woman both a part of, and rebelling against, the establishment. The term, therefore, appears to have significant linguistic strength.
The commercial-strength inquiry "looks at the marketplace and asks `if in fact a substantial number of present or prospective customers understand the designation when used in connection with a business to refer to a particular person or enterprise.'" CareFirst, 434 F.3d at 269. Stubblefield, at the time of the commencement of this lawsuit, claims to have sold over $10,000 in merchandise related to the "Rebel Debutante" mark through a website. The record also indicates that over 25,000 consumers have purchased "Confessions of a Rebel Debutante" (after the appearance of Forsythe's "Rebel Debutante" collection) and that the publication contract for the book arose as a result of Stubblefield's website. Although her book was placed on the market after introduction of the collection, those sales and an earlier book contract suggest that in some measure the term "Rebel Debutante" would be considered closely associated with Stubblefield by a segment of the consuming public. Accordingly, this factor weighs in favor of Stubblefield.
Stubblefield contends that the two marks are identical (because they contain "Rebel Debutante") and that customers are unlikely to believe that the pairing is
Neither CareFirst nor Four Seasons suffices to carry the day for Forsythe. In CareFirst, the court determined on summary judgment that a Virginia primary care physician group's use of the name "First Care" was not likely to cause confusion with plaintiff's "CareFirst" mark used predominantly as "CareFirst Blue Cross Blue Shield." After noting that plaintiff was aware of defendant's use for over eight years before suing, the court conducted its likelihood of confusion analysis and found it important that no actual confusion could be shown over that extended period. Noting (which Forsythe emphasizes here) that "[i]f one of two similar marks is commonly paired with other material, that pairing will serve to lessen any confusion that might otherwise be caused by the textual similarity between the two marks," the court stated that this "is most significant when ... the allegedly infringed mark ... has little independent strength." 434 F.3d at 271. The court found the "CareFirst" mark weak with little conceptual strength upon evidence that "dozens" of healthcare-related businesses used "CareFirst" or "First Care." Id. at 269-70. The court concluded that "[b]ecause CareFirst's registered mark is weak, consumers encountering `CareFirst BlueCross BlueShield,' on the one hand, and `First Care' on the other, are more likely to focus on the differences between the two" particularly in light of the prominence of the "Blue Cross Blue Shield" mark. Id. at 271.
Any support CareFirst might provide Forsythe is not well-developed on this record. The mark "Rebel Debutante," unlike the weak CareFirst mark, is peculiar and possesses independent conceptual strength. No one is shown to use the "Rebel Debutante" mark other than Stubblefield, who appears to have coined the phrase, and, for a time, Forsythe. Moreover, "CareFirst" and "First Care" are only similar, whereas "Rebel Debutante" is identical. Unlike in CareFirst, the court cannot say on this record that the parties' use of the mark is sufficiently different to reduce the likelihood of confusion. It is also important that CareFirst was decided on a full factual record on summary judgment, yet in this case discovery has only just begun.
Four Seasons involved a challenge by the owner of the "Four Seasons" hotel mark against the operator of a "Holiday Inn" hotel in Greensboro, North Carolina. The defendant used the "Four Seasons" name in advertising because the hotel was located at Four Seasons Town Centre Mall. The court found that the defendant's use of "Four Seasons" by itself infringed on the plaintiff's protected marks. 776 F.Supp. at 248. Most of the remainder of the court's discussion concerned the defendant's attempt to establish a prior use defense. It was in that context that the court recognized that "[u]se of a strong, well-known mark as part of a composite name reduces the likelihood that the remainder of that composite name will create a commercial impression distinct from the well-known mark." Id. at 247. The court quickly noted, however, that "Holiday Inn" is "one of the strongest, most well-known service marks in the American hotel industry." Id. Here, Forsythe has not made this showing as to "Color Club." More to
Although pairings may decrease or eliminate the likelihood of confusion in some cases, simply pairing a registered trademark with another mark cannot alone avoid a finding of a likelihood of confusion. See Super Duper, Inc. v. Mattel, Inc., 382 Fed.Appx. 308, 316 (4th Cir.2010) (unpublished per curiam) (approving jury instruction that placement of house mark on packaging did not ipso facto foreclose the possibility that a likelihood of confusion existed; citing CareFirst), cert. denied, ___ U.S. ___, 131 S.Ct. 1003, 178 L.Ed.2d 827 (2011).
A mark holder is not limited to protection of only the products listed in its application to USPTO or by the resulting certificate of registration. Suggestive marks
Cosmetics are, to some degree, related to women's apparel. Apparel has been identified as related to other products, including cosmetics, generally in cases involving a well-known mark or involving identical marks. In re Jacques Bernier Inc., 1 U.S.P.Q.2d 1924, 1925, 1987 WL 123809 (T.T.A.B.1987)
The court finds that, on balance, this factor favors Stubblefield.
Stubblefield argues that she advertises over the Internet and that an Internet search using the term "Rebel Debutante" produces a search result in which advertisements for Forsythe's "Rebel Debutante" collection appear immediately before and after her advertisements. (Doc. 8 at 8; see Doc. 8-13.) She also has an Internet blog and argues that Forsythe's Internet blog devoted to its nail polish products targets the same demographic market as hers. (Doc. 8 at 8, 26-27; see Docs. 8-14, 8-15.) Forsythe, however, asserts that its products are sold in a completely different manner and to different types of women than Stubblefield's current products. (Doc. 44 at 16.)
That both the Plaintiffs (nearly exclusively) and Forsythe (as part of a larger advertising approach) employ the Internet to market their products, as do probably the majority of sellers today, does not resolve whether the products are targeted to the same market. For those customers
Stubblefield asserts that infringement was deliberate,
Forsythe's President asserts that she had never heard of Stubblefield, her book, her company or the Rebel Debutante mark prior to receiving Plaintiffs' cease and desist letter. Forsythe contends, and the evidence tends to show, that it contracted with an independent creative consultant, who created a list of potential product names, including "Rebel Debutante," from which Forsythe made selections. The Color Club line "Rebel Debutante," Forsythe states, came out in January 2010 and included one specific color of polish. (Doc. 20-2, Rose Decl. ¶¶ 6-7, 10; Doc. 34-5, Rose Decl. ¶¶ 3, 9-10.) At this early stage, there has been no indication whether Forsythe was made aware of either the source of the consultant's "Rebel Debutante" recommendation or whether the consultant conducted a trademark search.
Though Stubblefield's use of the "Rebel Debutante" mark predated Forsythe's use by a few years, by late 2008 her use of it on clothing appears to have been quite limited. While the uniqueness of the mark would make it highly coincidental that it was originated independently, for purposes of Stubblefield's Motion there is no evidence that Forsythe knew of it or Stubblefield or intended to use the mark to confuse the public. Moreover, Forsythe's failure to undertake a search of the mark
On this record, therefore, the court will make no finding of what Stubblefield may
Stubblefield is not required to show actual, but only likelihood of, confusion. Sara Lee, 81 F.3d at 463 ("[E]vidence of actual confusion is unnecessary."); Lone Star, 43 F.3d at 933. To be sure, though actual confusion is not required, "evidence of actual confusion is `often paramount' in the likelihood of confusion analysis." George & Co., 575 F.3d at 393 & 398. However, there is no evidence of actual confusion among the consuming public here, and this factor favors Forsythe.
This factor looks to the proximity of products as actually sold. The products do not appear in proximity except as sold through Internet advertising
The "gap" between apparel and cosmetics is not great. The parties disagree as to the ease in which an entity can enter the nail polish market as well as the veracity of Stubblefield's claimed intent to do so. Stubblefield asserts that there is a high probability that she will bridge the gap into the nail polish business, citing current negotiations with a Winston-Salem store to sell items including nail polish as well as her receipt of an e-mail inquiry from a potential customer whether she manufactured the nail polish worn by a model shown in connection with her mark. (Id. ¶¶ 12-14 (Stubblefield's stated intent); Doc. 8-22 (e-mail).) Stubblefield also asserts that market entry is relatively inexpensive because the product is available from manufacturers and is inexpensive to brand. (Doc. 8 at 31.)
Forsythe counters by pointing out that Stubblefield is a full-time law student (see Doc. 24-1, Stubblefield Aff. ¶ 3 & Ex. 2) who would have a difficult time expanding into the nail polish business while "studying to pass the bar." Forsythe also observes that Stubblefield has offered no business plan or documentary evidence demonstrating the alleged planned expansion into nail products, which Forsythe says has a high barrier to entry (including compliance with Food and Drug Administration and Environmental Protection Agency regulations). (Doc. 44 at 15.) Therefore, it contends, it is highly unlikely that Stubblefield, who offers non-brand name apparel items such as "t-shirts, thongs, and shorts," would be expected to expand into cosmetics products, including nail care. (Id. at 15; Doc. 45, Rose Decl. ¶ 8.)
"This factor inquires into whether a plaintiff is likely to enter defendant's market, or `bridge the gap.' It recognizes the senior user's interest in preserving avenues of expansion and entering into related fields." Morningside Grp. Ltd. v. Morningside Capital Grp., L.L.C., 182 F.3d 133, 141 (2d Cir.1999) (internal quotation marks omitted). This factor may be particularly relevant when the goods are dissimilar, and a plaintiff who is likely to bridge the gap may be able to assert its trademark rights over another as to a product that is unrelated to the plaintiff's product. U.S. Hosiery Corp. v. The Gap, Inc., 707 F.Supp. 800, 813 (W.D.N.C.1989) (stating on summary judgment that "when the goods are dissimilar, courts will often also consider whether plaintiff is likely to `bridge the gap' between the plaintiff's
Forsythe has not presented evidence of the claimed difficulty of entering the nail polish market, nor has Stubblefield presented evidence of the claimed ease of doing so. At this stage, Stubblefield appears to contemplate at best a minor or modest presence in the nail polish market by offering "Rebel Debutante" nail polish in connection with a number of related apparel products. Stubblefield's use of the mark is relatively new, and thus it cannot be said that she will be unable to "bridge the gap" into the nail polish market. The proponent, however, must show that its intent to expand is realistic, not merely wishful. See U.S. Hosiery, 707 F.Supp. at 813 (characterizing party's likelihood to bridge the gap in case before it as a wish rather than a reality). On the other hand, if Stubblefield was already entering the nail polish market in which Forsythe competes, this factor would not be relevant except as to indicate a greater likelihood of confusion as there would be no gap to be bridged. E.g., TCPIP Holding Co. v. Haar Commc'ns, 244 F.3d 88, 102 (2d Cir. 2001). Consequently, insofar as this factor seeks to preserve "likely" avenues of expansion for a mark holder and Stubblefield has demonstrated an intent to enter (though no present means to do so) the market, this factor slightly favors Stubblefield. The limited geographic market of Stubblefield's intent (discussions with a Winston-Salem retailer) further reduces the importance of this factor.
Stubblefield argues that an infringement itself gives rise to an irreparable injury and that the Fourth Circuit regularly grants preliminary injunctions in infringement cases without specifically addressing irreparable injury. (Doc. 8 at 34.) Forsythe objects to any presumption of irreparable harm on the grounds that it no longer exists after the Supreme Court's decision in eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 126 S.Ct. 1837, 164 L.Ed.2d 641 (2006). Moreover, even if the presumption were available, Forsythe contends, it has been rebutted by Stubblefield's six-month delay in bringing this action once she became aware of Forsythe's use of the term "Rebel Debutante" in its "Color Club" collection, as well as by her inability to demonstrate actual harm.
The Fourth Circuit has recognized, in the context of a Lanham Act trademark infringement case, that "a presumption of irreparable injury is generally applied once the plaintiff has demonstrated a likelihood of confusion, the key element in an infringement case." Scotts Co. v. United Indus. Corp., 315 F.3d 264, 273 (4th Cir.2002); see Lone Star, 43 F.3d at 938-39. The Fourth Circuit in Scotts, however, did not expressly adopt that presumption but noted that district courts in the Fourth Circuit had applied the test, 315 F.3d at 273 & n. 3, and, since Scotts, those courts have continued to do so. The court is not persuaded that eBay alters the current law in this regard.
In eBay, the Supreme Court held in an action seeking a permanent injunction pursuant to the Patent Act, the traditional four-factor permanent injunction test applies. The Court stated that its decision was consistent with its prior rejection, under the Copyright Act, of invitations "to replace traditional equitable considerations with a rule that an injunction automatically follows a determination that a copyright has been infringed." 547 U.S. at 391-94, 126 S.Ct. 1837.
eBay is distinguishable on several grounds. First, it involved a permanent, rather than preliminary, injunction. A preliminary injunction preserves the status quo at an early and incomplete stage of the litigation in anticipation of a decision on the merits. Second, there are distinctions between copyright and patent infringement actions, where monetary damages are often central, and trademark infringement, where confusion may have long-lasting effects. Third, several district courts in the Fourth Circuit continue to recognize the presumption in trademark cases after eBay, although often without citing the opinion. See, e.g., Meineke Car Care Ctrs., Inc. v. Catton, No. 3:10-CV-000234-RLV-DSC, 2010 WL 2572875, at *2 (W.D.N.C. June 24, 2010) (noting court in Lone Star "acknowledged that the `irreparable injury necessary for injunctive relief regularly follows from trademark infringement'"); Lorillard Tobacco, 616 F.Supp.2d at 587 (presumption of injury "generally applied" once plaintiff has shown a likelihood of confusion); Toolchex, Inc. v. Trainor, 634 F.Supp.2d 586, 591 n. 2 (E.D.Va.2008). Indeed, in an opinion issued the year after eBay, National League of Junior Cotillions, Inc. v. Porter, No. 3:06-cv-508, 2007 WL 2316823, at *6 (W.D.N.C. Aug. 9, 2007), aff'd, 280 Fed.Appx. 322 (4th Cir. 2008), the district court noted, with respect to trademark infringement, that "[b]ecause
At this stage and in the absence of any indication from the Fourth Circuit to the contrary, the court will not discard the commonly-applied presumption of irreparable harm in preliminary injunction proceedings involving a trademark infringement claim.
Nor is the court persuaded that Stubblefield's six-month delay in bringing this action prevents a finding of a likelihood of irreparable harm. It is true that "[s]ince an application for preliminary injunction is based upon an urgent need for the protection of [a] Plaintiff's rights, a long delay in seeking relief indicates that speedy action is not required." Quince Orchard Valley Citizens Ass'n, Inc. v. Hodel, 872 F.2d 75, 80 (4th Cir.1989). Balanced against a delay in seeking injunctive relief, however, is the goal of voluntary resolution of disputes without the need for litigation. E.g., Splitfish AG v. Bannco Corp., 727 F.Supp.2d 461, 468 (E.D.Va.2010) (concluding eight-month delay in case before court not unreasonable and, "to the contrary, [plaintiffs] sought an efficient out-of-court resolution") (copyright claim).
Here, the correspondence between the parties (e.g., Docs. 8-16 through 8-20) cannot be said to be unduly protracted. Stubblefield's complaint alleges that her attorney wrote to Forsythe "[i]mmediately after Plaintiffs learned that Forsythe was infringing Plaintiffs' REBEL DEBUTANTE mark."
Trademark infringement cases are concerned in large measure with the reputation of and goodwill toward the mark holder. In this case, Stubblefield's use of the "Rebel Debutante" mark in the commercial setting is relatively recent, and Plaintiffs' business activity is relatively small compared to Forsythe's longer history. There is a danger, however, that Forsythe's use of Stubblefield's peculiar mark may decrease her opportunity to develop goodwill and reputation if the public is confused as to the mark's ownership. Cf. Buzz Off Insect Shield, LLC v. S.C. Johnson & Son, Inc., 606 F.Supp.2d 571, 585 (M.D.N.C.2009) (discussing "reverse confusion" when defendant uses greater size and strength to overwhelm plaintiff's senior mark).
The court concludes that, based on this record, Stubblefield has demonstrated a likelihood of irreparable harm absent a preliminary injunction.
Forsythe contends that it would suffer substantial harm if an injunction is
It is hard for Forsythe to contend it will suffer any appreciable harm if it is prohibited from marketing a product it contends it no longer intends to sell. On the other hand, Plaintiffs risk a likelihood of irreparable harm if Forsythe were to continue using their mark, as noted above. Therefore, Plaintiffs have demonstrated that the balance of equities tips in their favor as to prohibitory relief. Because the court will deny Plaintiffs' request for a mandatory injunction, as noted infra, any balance of equities as to the award of mandatory relief is moot.
Stubblefield argues that the public interest is served by protecting her registered mark and preventing consumer confusion in the marketplace. (Doc. 8 at 34 (citing cases)). In contrast, Forsythe argues that the public interest favors denying the Motion, principally because a mandatory injunction would put a financial hardship on its continued operations and constitute "drastic relief" under the circumstances. (Doc. 44 at 19.)
There is a strong public interest in preventing trademark infringement. Indeed, the "purpose of a trademark is to protect the public from confusion about `the identity of the enterprise from which goods and services are purchased.'" Toolchex, 634 F.Supp.2d at 594 (quoting AMP Inc. v. Foy, 540 F.2d 1181, 1185-86 (4th Cir. 1976)); see Merry Maids Ltd. P'ship v. Kamara, 33 F.Supp.2d 443, 446 (D.Md. 1998) ("Preventing infringement. serves the public interest in preventing consumer confusion."). In light of the court's finding of a likelihood of success on the merits, including a likelihood of confusion if Forsythe re-engages in marketing its product using Plaintiffs' mark, the court concludes that a preliminary prohibitory injunction is in the public interest.
Plaintiffs seek a mandatory injunction that requires Forsythe to collect all product and marketing materials in the field that bear the "Rebel Debutante" mark. At the hearing, Plaintiffs argued that because independent distributors may still have inventory, the court should also require Forsythe to notify them of the court's preliminary finding of the likelihood of success. As noted above, Forsythe opposes a mandatory injunction as a "drastic remedy" and states that it has ceased production of its "Rebel Debutante" line of nail polish.
"Mandatory preliminary injunctions [generally] do not preserve the status quo and normally should be granted only in those circumstances when the exigencies of the situation demand such relief. That is to say, a mandatory preliminary
Neither party has addressed the issue of an adequate bond in the event preliminary prohibitory relief is awarded. Because the court will enter only a prohibitory injunction, and because Forsythe represents that it does not intend to market any product bearing Plaintiffs' mark in the future, a nominal bond in the amount of $2,500 will be required at this stage.
For the foregoing reasons, the court finds that the action may continue in this forum and that Plaintiffs have made a clear showing for the entry of a prohibitory preliminary injunction to preserve the status quo.
IT IS THEREFORE ORDERED as follows:
1. The Motion to Transfer by Forsythe Cosmetic Group, Ltd. (Doc. 21) is DENIED;
2. Plaintiffs' Motion for Preliminary and Permanent Injunction (Doc. 7) is GRANTED IN PART AND DENIED IN PART;
3. Defendant Forsythe Cosmetic Group, Ltd., its officers, agents, servants, and employees, and any other person who is in active concert or participation with them, are enjoined preliminarily, pursuant to Federal Rule of Civil Procedure 65, from any advertising, distribution, offering for sale, sale, or shipping of products using or associated with the mark "Rebel Debutante" until further order of the court; and
4. Pursuant to Federal Rule of Civil Procedure 65(c), this Preliminary Injunction shall become effective upon the posting by Plaintiffs of Two Thousand Five Hundred Dollars ($2,500) security with the Clerk of Court.
