The opinion of the court was delivered by: Whyte, District Judge.
ORDER DENYING PLAINTIFF'S
MOTION FOR PRELIMINARY
The motion of plaintiff PostX Corporation ("plaintiff" or "PostX") for
preliminary injunction pursuant to Federal Rule of Civil Procedure 65(a)
was heard on July 30, 1999. The court has read the moving and responding
papers and heard the argument of counsel. For the reasons set forth
below, the court denies plaintiffs motion.
Plaintiffs logo (the "PostX logo") consists of a stylized line drawing
of the back of an envelope, with a black keyhole design on the back flap
of the envelope and the word "POSTX" appearing below the flap. See Exh. A
to Plaintiffs Motion for Preliminary Injunction. The envelope is drawn in
blue as it appears on the recipient's screen. Declaration of M. Michael
Serbinis ("Serbinis Decl.") Exh. Decl. Exh. 7 at 5. Plaintiff has
marketed its services and software to its customers and the public using
the PostX logo since September, 1996. Thomas Decl. ¶ 8. Plaintiff'
has placed the PostX logo on all of its marketing materials, computer
software labels, manuals and documentation, packaging, promotional and
advertising materials and on its Web site. Thomas Decl. ¶ 10.
Plaintiff has also displayed its logo at numerous trade shows. ¶
11. Plaintiff asserts that it has expended over $1.7 million in
connection with promotion of the PostX logo. Id. ¶ 13.
Defendant The docSpace Company ("defendant" or "docSpace"), founded in
1997, offers Web-based services for delivering, storing, managing and
collaborating on information securely over the Internet. Declaration of
Evan V. Chrapko ("Chrapko Decl.") ¶ 2. The two principal services
that defendant currently markets are "docSpace Express" and "docSpace
Drive." Serbinis Decl. ¶ 25.
DocSpace Express allows registered users of the service to send secure
email documents to email recipients. The docSpace Express customer user
registers by submitting identifying information and choosing a user ID
and password at defendant's Web site. The user then logs into docSpace
Express, and clicks on "Send" to access a document send page. At the send
page, the user types in the email address for each recipient as well as a
subject for delivery and a short message. The user chooses the documents
which he or she wants to be delivered to the recipient by entering the
filenames of the documents or by using a Windows file management
browser. Id. ¶¶ 26, 28-31, Exh. 1.
Defendant's other service, docSpace Drive, is a Web-based document
storage service that allows people to access documents stored in one
centralized, secure location. Id. ¶ 40. DoeSpace Drive allows users
to back up document files, organize files in directory structures and
perform other file management operations. Id. ¶ 40. All Web pages
that the docSpace Drive user encounters include the docSpace logo in the
upper left corner of the page.
Defendant's logo (the "docSpace logo") is a black outline drawing of a
rectangular file folder with a black keyhole design at the center and
graduated horizontal lines extending from the left edge. See Serbinis
Decl. Exh. 5. The word "docSPACE" appears directly below the graphic,
with "doc" in lower case bold and "SPACE" in upper case outlined
letters. Id. Michael Serbinis, co-founder of defendant and creator of the
logo, does not believe that he was aware of the PostX logo when he
designed the docSpace logo in January and February of 1998. Serbinis
Decl. ¶¶ 2, 42, 45, 49. DocSpace has spent close to $600,000 in
connection with the marketing of the docSpace logo through design of its
graphics and Internet Web site, publications, advertising, promotions,
mailings, public relations and trade shows. Chrapko Decl. ¶ 41.
Plaintiff filed a complaint for injunctive relief and damages against
defendant on March 22, 1999, alleging trademark infringement and false
designation of origin, trademark dilution and unfair competition.*fn1 On
the present motion for a preliminary injunction, plaintiff states that it
"is not requesting that docSpace cease use of its logo," but is rather
"merely requesting that docSpace cease from using the keyhole picture in
its mark." Plaintiffs Reply in Support of Motion for Preliminary
Injunction ("Reply") at 14:13-14.*fn2
A court may issue a preliminary injunction where the moving party has
shown (1) a combination of probable success on the merits and the
possibility of irreparable injury or (2) that serious questions are raised
and the balance of hardships tips sharply in its favor. Rodeo
Collection, Ltd. v. West Seventh, 812 F.2d 1215, 1217 (9th Cir. 1987).
"These are not two distinct tests, but rather the opposite ends of a
single `continuum in which the required showing of harm varies inversely
with the required showing of meritoriousness.'" Id., quoting San Diego
Comm. Against Registration & Draft v. Governing Rd. of Grossmont
Union High Sch. Dist., 790 F.2d 1471, 1473 n. 3 (9th Cir. 1986).
A. Likelihood of Success on the Merits — Trademark Claim
In order to succeed on its federal trademark claim, plaintiff must
establish both (1) that it has a protected interest (or trademark right)
in the service allegedly infringed by defendant's service and (2) that
defendant's service usage is likely to cause consumer confusion and thus
infringe upon that interest. Levi Strauss & Co. v. Blue Bell, Inc.,
778 F.2d 1352, 1354 (9th Cir. 1985).
Plaintiff has been using its trademark logo since 1996. Inherently
distinctive trademarks and suggestive trademarks are protected without
evidence of secondary meaning. See AMF, Inc. v. Sleekcraft Boats,
599 F.2d 341, 349 (9th Cir. 1979). Defendant does not argue that
plaintiffs mark ...