Healthvana, Inc. v.
Telebrands Corp., 2022 WL 562265, No. CV 20-04305 DDP (SKx) (C.D. Cal. Feb. 23,
2022)
Healthvana operates
a health app, Healthvana, and has a trademark (registration) for use in
connection with software and software as a service. The app initially focused
on delivering the results of HIV tests, and tests for other sexually
transmitted diseases, to patients. Healthvana then shifted the focus of its
digital platform to Covid test records, and later vaccination records. “At all
times, Healthvana’s customers have not included end users of software or the
Healthvana app, but rather governmental entities, healthcare firms, medical
officers, laboratories, and employers.”
Telebrands markets
and sells “As Seen on TV” consumer household products via websites, phone
numbers, and big box retailers. Among its products is a line of “Hempvana”
products. Telebrands made a pandemic-related effort to market and sell a hand
sanitizer product, but retailers were historically reluctant to carry products
associated with hemp, so it used “Healthvana” for its hand sanitizer. Its marketing
efforts included a “direct response” TV commercial and a website, and later
expanded to big box stores.
In March 2020, Healthvana
objected, and Telebrands’ counsel indicated that it would rebrand as “Handvana.”
“By April 17, Telebrands represented that all changes had been made. Several
hundred thousand bottles of hand sanitizer, however, had already been produced
with the older, ‘Healthvana’ label. Those bottles were filled and shipped to
big box customers sometime after April 17.” Healthvana sued in May 2020 for trademark
infringement, unfair competition, and false advertising in violation of both
federal and state law, as well for cybersquatting under ACPA.
Telebrands won
summary judgment.
Strength: “fanciful
or perhaps suggestive,” so “some degree of protection”; no discussion of
marketplace strength, which probably tells you how this might go.
Relatedness of
goods: “Products and services related to a general industry may, in some cases,
be related to each other, insofar as consumers are likely to associate one
party’s products with the other party.” But “health” as part of a name was related
to the industry, so “the fact that both parties’ products relate to the same,
very general industry is of little moment.” Plus, “the universe of
health-related products and services” is very broad. Nor was the relevant
universe “Covid-related products,” since hand sanitizer is not “Covid hand
sanitizer” but indisputably general hand sanitizer. Telebrands’ TV ad didn’t
use the word “Covid” [I bet litigation counsel is grateful for FDA compliance
efforts carried out in writing the copy!]. And even if Telebrands focused on the
Covid-related market, the court was “skeptical that Healthvana’s phone app
software would necessarily be ‘related to’ every other product in the universe
of arguably Covid-related products, including hand wipes, cleaning solutions,
masks, gloves, face shields, prescription medicines, vaccines, pulse oximeters,
UV-sanitizers, thermometers, and so on.”
Similarity:
defendant's logo that somehow got uploaded first: Brown "health," black "vana" with part of v replaced by leaf [probably the hemp link coming back] and an umlaut over the middle a plaintiff's logo: gray text with blue heart logo that has an internal outline of a checkmark
The court compared the marks as used in the marketplace,
with different color, font, and imagery. The marketplace itself differed:
Healthvana’s mark was on an app, and Telebrands’ in the physical market.
Similarity only weighed “very slightly” in favor of confusion.
Actual confusion: The court rejected most of Healthvana’s
purported “hundreds of instances of
actual confusion.” “[S]tand-alone enquiries and misdirected communications” are
not evidence of actual consumer confusion. Especially in electronic formats, such
evidence may demonstrate only that consumers were “inattentive or careless, as
opposed to being actually confused” about the source of a product. However,
there was evidence that some consumers did believe that Healthvana was the
company selling Healthvana-brand hand sanitizer, favoring a finding of
confusion.
Marketing channels:
Sharing the internet as marketing channel wasn’t enough; this factor disfavored
likely confusion.
Consumer care: Consumers
of Healthvana’s software product “are sophisticated entities such as
governments and laboratories who, if Healthvana’s revenues are any indication,
pay non-negligible amounts for Healthvana’s services and products.” Telebrands’
consumers, “on the other hand, are not likely to be sophisticated or to
exercise a high degree of care when purchasing a relatively inexpensive bottle
of hand sanitizer.” Using the least sophisticated consumer as the measure, this
factor weighed somewhat in favor of a likelihood of confusion. [This analysis
shows the weakness of choosing “least sophisticated party” in all
circumstances. That only makes sense if the least sophisticated party is a plausible
purchaser of both sets of goods/services. Anyone thinking of contracting with
Healthvana—regardless of how careful or careless they were tossing goods into a
cart at Wal-Mart—would take a lot more care.]
Intent: Minimally
important, and there was no evidence that Telebrands intended to confuse or
deceive either its own or Healthvana’s customers. “Although Healthvana makes
much of the fact that Telebrands shipped out ‘Healthvana’ labeled bottles even
after agreeing to change its branding, the evidence is undisputed that the
bottles had already been produced. A de-identification period spanning a matter
of weeks hardly constitutes evidence of any bad intent on Telebrands’ part.”
Product line
expansion: No evidence of intent to expand; weighed against confusion.
Balancing the
factors: Actual confusion weighed in favor of confusion; mark strength, mark
similarity, and degree of care weighed slightly in favor of confusion; but the
other factors were either neutral or weighed against confusion, and the
unrelatedness of the goods weighed “heavily” against likely confusion. Telebrands
was entitled to summary judgment. [Surprised? I think it’s really
unrelatedness+degree of care used for the more expensive product doing the work.]
False advertising:
This analysis is interesting mostly because it makes clear how much higher the
causation standards are in §43(a)(1)(B) than in §32/§43(a)(1)(A) analysis.
Competition wasn’t required for liability as long as there was commercial
injury, including harm to reputation, but injury must be shown to come “as a
result of the false statement.”
Although [Healthvana’s] evidence certainly indicates reputational harm
to Healthvana, the link between consumer anger and the allegedly false
statements is less clear. Healthvana’s First Amended Complaint alleges that
Telebrands falsely stated that its version of Healthvana was a “trusted brand
since 2015,” had “over 100 million satisfied customers,” that Telebrands’
sanitizer contained an ingredient used in hospitals, and that Telebrands had
maintained a website since 2019, when in reality the website went live in 2020.
But Healthvana didn’t
identify any complaint related to any of the allegedly false statements.
Cybersquatting: Healthvana challenged Telebrands’
registration and use of healthvanafoam.com but could not show bad faith:
Healthvana appears to rely on the fact that Telebrands’ website was
still operational on April 4, four days after Telebrands voluntarily agreed to
change its Healthvana branding. As discussed above, a de-identification period
of less than one week hardly demonstrates bad faith or intent. Furthermore,
given the court’s trademark analysis, above, Telebrands’ belief that its use of
the domain name was lawful was a reasonable one.
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