Monday, December 24, 2012

Merely alleging use for commercial purposes insufficient for TM claim

E Clampus Vitus v. Steiner, 2012 WL 6608612 (E.D. Cal.)

Plaintiff ECV sued defendants for trademark infringement/unfair competition based on defendants’ alleged misuse of ECV’s trademarks.  Defendants moved to strike and dismiss the complaint.  The anti-SLAPP motion was denied, but the motion to dismiss was granted.

ECV alleged that it had valid marks, including registrations, for E Clampus Vitus, ECV, and Clampers marks.  The marks were used to indicate membership in its fraternal organization and for related purposes.  ECV also used them for goods such as pins, hats, and shirts.

ECV alleged that defendants “participated in the 2010 City of Woodland Christmas parade as a member of the Joseph Zumwalt Chapter,” and that they used ECV’s marks “for commercial purposes” and “caused confusion by using and alleging that they had the right to use the trademark rights.”  They also allegedly conducted a March 2011 event called the 4–SKIN DOINS, “in which the trademarks of Plaintiff were used for commercial purposes,” and participated in the annual Georgetown Founders Day Celebration using ECV’s marks “for commercial purposes, causing public confusion, and alleging that they had the right to use E Clampus Vitus, ECV, and Clampers.”  The sale of hot dogs at Founders Day in the name of ECV Georgetown allegedly infringed ECV’s marks.  Further, they alleged that defendants “will be auctioning off a motorcycle under the name Joseph Zumwalt ECV.”

The defendants moved to dismiss under the anti-SLAPP statute, arguing that the gravamen of the complaint was that “defendants marched together in a parade as Clampers, engaged in various charitable works together as Clampers, and held themselves out publicly to be Clampers .... This is unequivocally protected speech the whole purpose of which is to raise public awareness and financial assistance for community and social issues and needs.”  But the court decided that the statements/conduct at issue didn’t concern a “public issue” or “issue of public interest” as required by the relevant provisions of the anti-SLAPP statute.  An issue that is of interest only to a definable portion of the public and that’s not in the context of an ongoing controversy, dispute or discussion isn’t enough to trigger the statute.  The issue here was only of interest to a definable portion of the public—members and/or supporters of ECV—and defendants didn’t allege that their conduct occurred in the context of an ongoing controversy, dispute, or discussion.

However, ECV’s complaint flunked the pleading standards.  Defendants argued that ECV failed to plead any specific facts indicating likely confusion according to the multifactor confusion test.  Merely alleging that the plaintiff had a registered mark and that the defendant used it with respect to goods and services not covered by the registration was insufficient to plead that confusion was likely.  Allegations that defendants used the “trademarks of Plaintiff” for “commercial purposes” were conclusory and didn’t indicate which marks were used or the manner in which defendants used them. As to the alleged sale of hot dogs and auction of a motorcycle, ECV didn’t allege sufficient facts from which a reasonable inference could be drawn that these items were related to ECV’s pins, shirts, and headgear that Plaintiff allegedly sells.  Thus, the state and federal trademark infringement/unfair competition claims were dismissed.

As for the state law false advertising claim under California Business & Professions Code section 17500, it was subject to Rule 9(b).  The allegations that “Defendants have further violated [section 17500], committing false advertising, by selling goods and services, misrepresenting their identity, and signing up new ‘members', who think they are joining E Clampus Vitus, but in actuality, are not” were too conclusory to provide the specificity required by Rule 9(b).  They didn’t identify any allegedly false statements or state how any such statement was misleading.   Complaint dismissed with leave to amend.

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