ANDREW L. CARTER, JR., District Judge.
Before the Court is Defendant's motion to dismiss Plaintiffs' fourth and fifth claims for relief. For the reasons set forth below, this Court now denies the motion to dismiss.
Plaintiffs Pearson Education, Cengage Learning, Inc., and Bedford, Freeman, & Worth Publishing Group ("Plaintiffs") bring a lawsuit against Boundless Learning Inc. ("Defendant") for five causes of action: 1) direct copyright infringement as unauthorized derivative work; 2) direct copyright infringement as unauthorized reproduction and distribution; 3) secondary copyright infringement; 4) unfair competition and false designation of origin; and 5) false advertising.
Plaintiffs allege that Defendant Boundless has engaged in unfair competition and false advertising based on (i) the alleged copying of the selection, coordination and arrangement of topics and concepts from Plaintiffs' Textbooks; (ii) including the "titles" of Plaintiffs' Textbooks and images of the covers of Plaintiffs' Textbooks in advertising for the Boundless Electronic Textbooks; (iii) advertising the Boundless
Copyright law gives the author the right to prevent copying of the copyrighted work in any medium. Trademark law prevents the use of a similar mark on such goods and services as would probably cause confusion. A plaintiff claiming unfair competition under § 43(a) based on infringement of an unregistered mark must show that it owns a valid trademark eligible for protection and that a defendant's use of a trademark similar to plaintiffs mark on or in connection with its product is likely to cause confusion as to the origin of defendant's product.
Defendant brought a motion to dismiss Plaintiffs' Fourth and Fifth claims for relief under Section 43(a) of the Lanham Act. Defendant argues that Plaintiffs' false advertising claim essentially duplicates its unfair competition/false designation of origin claim. Defendant argues that Plaintiffs fail to allege that they own any protectable trademark in the titles of Plaintiffs' textbooks, citing to case law that a title of a periodical that is generic cannot serve as a trademark. CES Pub. Corp. v. St. Regis Publications, Inc., 531 F.2d 11, 13-14 (2d Cir.1975). For the reasons that follow, the Court denies the Defendant's motion to dismiss.
On a motion to dismiss, this Court accepts all factual allegations in the complaint as true and draws all reasonable inferences in the plaintiff's favor. Ruotolo v. City of N.Y., 514 F.3d 184, 188 (2d Cir.2008). Nonetheless, to survive a motion to dismiss, "a complaint must contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 663, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). A claim has "facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 129 S.Ct. at 1949. "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." Plumbers & Steamfitters Local 773 Pension Fund v. Canadian Imperial Bank of Commerce, 694 F.Supp.2d 287, 296 (S.D.N.Y.2010). Although "a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiffs obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Starr v. Sony BMG Music Entm't, 592 F.3d 314, 321 (2d Cir.2010).
In ruling on a motion to dismiss, a "court may consider the facts as asserted within the four corners of the complaint together with the documents attached to the complaint as exhibits, and any documents incorporated in the complaint by reference." Peter F. Gaito Architecture,
The issue before the Court on this motion to dismiss "is not whether ... plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." Villager Pond, Inc. v. Town of Darien, 56 F.3d 375, 378 (2d Cir.1995), cert, denied, 519 U.S. 808, 117 S.Ct. 50, 136 L.Ed.2d 14 (1996) (citation omitted).
"To prevail on a claim under Section 43(a), a plaintiff must show that (1) it has a valid trademark entitled to protection, and (2) the defendant's mark infringes on the plaintiff's mark by causing a likelihood of confusion among consumers as to the origin or sponsorship of its product." Jewish Sephardic Yellow Pages, Ltd. v. DAG Media, Inc., 478 F.Supp.2d 340, 356 (E.D.N.Y.2007) (citing Time, Inc. v. Petersen Publ'g Co., 173 F.3d 113, 117 (2d Cir.1999)).
Defendants argue that Plaintiffs' false advertising claim lacks factual support for how or why it is false for Boundless to call the Boundless Electronic Textbooks "equivalent" to Plaintiffs' Textbooks and, thus fails to state a claim of false advertising.
Defendant moves against plaintiffs' unfair competition claim on the grounds that the charge in violation of the Lanham Act fails to state a claim distinct from the copyright infringement charge and is preempted by the Copyright Act. Defendant does not address the issue of whether plaintiff has produced sufficient evidence to prove an unfair competition claim under Section 43(a).
As an initial matter, to establish standing for a false advertising claim under section 1125(a) of the Lanham Act, the aggrieved party must demonstrate "a reasonable interest to be protected against the advertiser's false or misleading claims, and a reasonable basis for believing that this interest is likely to be damaged by the false or misleading advertising." Ortho Pharm. Corp. v. Cosprophar, Inc., 32 F.3d 690, 694 (2d Cir.1994) (internal citation and quotation marks omitted). The likelihood of injury and causation "will not be presumed, but must be demonstrated in some manner." Coca-Cola Co. v. Tropicana Prods., Inc., 690 F.2d 312, 316 (2d Cir. 1982), abrogated on other grounds by Fed. R.Civ.P. 52(a).
The Second Circuit has consistently held that standing to bring Lanham Act claims exists where the defendant has drawn a direct comparison between its own product and that of the plaintiff. Societe des Hotels Meridien v. LaSalle Hotel Operating P'ship, L.P., 380 F.3d 126, 130 (2d Cir. 2004) citing McNeilab, Inc. v. Am. Home Prods. Corp., 848 F.2d 34, 38 (2d Cir.1988) (holding that injury can be presumed, for purposes of obtaining a preliminary injunction, in a Lanham Act claim for false comparative advertising). Here, Plaintiffs' products are in competition with the defendant's products and defendant's advertisements allegedly draw direct comparisons between the products. Thus, Plaintiffs have standing to bring their Lanham Act claims.
A claim under the Lanham Act for false advertising requires allegations that: (1) the advertisement is literally
Defendant's motion to dismiss argued that the United States Supreme Court's decision in Dastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23, 123 S.Ct. 2041, 156 L.Ed.2d 18 (2003) foreclosed Plaintiffs' Lanham Act claims, which are supposedly in fact copyright claims. The Court's holding in Dastar addressed only the applicability of section 43(a)(1)(A) to reverse passing off claims, which occurs when a producer misrepresents someone else's goods as his or her goods. Fox did not assert a claim under section 43(a)(1)(B), the false advertising prong of the Lanham Act. 15 U.S.C. § 1125(a)(1)(B). See id. at 36, 38, 123 S.Ct. 2041. The Court grounded its holding in what it ruled was the "natural understanding" of section 43(a)(1)(A)'s phrase "origin of goods." See id. at 32-32, 37, 123 S.Ct. 2041. It concluded, in short, that although this phrase does not extend to the originator of the idea that the goods embody, it does reach beyond geographic origin to origin of production of the physical goods at issue. See id. at 32, 37, 123 S.Ct. 2041. Congress did not incorporate any such reference into section 43(a)(1)(B). Instead, in section 43(a)(1)(B), it mandated liability for misrepresentation of "the nature, characteristics, [or] qualities" of goods in commercial advertising or promotion. 15 U.S.C. § 1125(a)(1)(B).
Dastar explicitly left open the possibility that some false authorship claims could be vindicated under the auspices of section 43(a)(1)(B)'s prohibition on false advertising. Dastar does not preclude a Lanham Act claim based on deceptive and confusing advertising of the tangible product in which the creative content is embodied. Plaintiffs argue that the titles of their Textbooks are "inherently distinctive and have achieved secondary meaning entitling [them] to trademark protection." Secondary meaning "is used in typical passing-off cases involving trademarks or trade dress which are not inherently distinctive; in such a case, a plaintiff, in order to prove consumer confusion, must generally show that the copied features of its product have attained a secondary meaning." Waldman Publ'g Corp. v. Landoll, Inc., 43 F.3d 775, 784 n. 7 (2d Cir. 1994) (internal quotation marks omitted); see 815 Tonawanda St. Corp. v. Fay's Drug Co., Inc., 842 F.2d 643, 649 (2d Cir.1988) (requiring proof of "secondary meaning" in order to receive trademark protection for descriptive trademarks).
Plaintiffs' complaint goes beyond a simple allegation of copying. Contrary to Defendant's argument, Plaintiffs' Lanham Act claims are not clearly duplicative because they are not based solely on alleged copying. Here, Plaintiffs have pleaded that Defendant falsely represented that it offers a digital version of Plaintiffs' textbooks or something equivalent. As such,
Based on the foregoing, this Court denies Defendant's motion to dismiss.
SO ORDERED.