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Planet Coffee Roasters, Inc. v. Dam

February 18, 2010

PLANET COFFEE ROASTERS, INC., PLAINTIFF,
v.
HUNG DAM, DBA PLANET COFFEE, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Marc L. Goldman United States Magistrate Judge

MEMORANDUM OPINION AND ORDER DENYING PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION WITHOUT PREJUDICE

I. Factual and Procedural Background

On August 20, 2009, Plaintiff Planet Coffee Roasters, Inc., filed a motion for preliminary injunction seeking to enjoin Defendant Hung Dam from using the mark "Planet Coffee" as the name of his coffee shop, located in Garden Grove, California. (Mem. of P. & A. in Supp. of Pl.'s Mot. for Prelim. Inj. at 4.) Plaintiff alleges that Defendant is willfully infringing Plaintiff's unregistered trademark by use of a confusingly similar mark. (Id.) Plaintiff alleges that Defendant's use of the mark "Planet Coffee" has caused consumer confusion between Defendant's mark and Plaintiff's. (Id.)

In the first amended complaint, Plaintiff alleges that, at least since 1990, it has been operating a well-known and successful business offering services related to coffee, including coffee beans, coffee roasting supplies and equipment. The first amended complaint accuses Defendant of unlawfully using Plaintiff's mark "Planet Coffee" in violation of section 43(a) of the Lanham Act. 15 U.S.C. § 1125(a). Plaintiff does not hold a federally registered trademark on either "Planet Coffee" or "Planet Coffee Roasters."

On September 4, 2009, Defendant filed an opposition to the motion for preliminary injunction. On September 22, 2009, the Court heard oral argument on the motion. For the reasons stated below, the motion for preliminary injunction is denied without prejudice.

II. Standard of Review

Under Ninth Circuit precedent, a plaintiff is entitled to a preliminary injunction when it establishes either: (1) a combination of probable success on the merits and the possibility of irreparable injury, or (2) the existence of serious questions going to the merits, where the balance of hardships tips sharply in plaintiff's favor. GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1204-1205 (9th Cir. 2000). "This analysis creates a continuum: the less certain the district court is of the likelihood of success on the merits, the more plaintiffs must convince the district court that the public interest and balance of hardships tip in their favor." Southwest Voter Reg. Educ. Project v. Shelley, 344 F.3d 914, 918 (9th Cir. 2003.), see also GARCOA v. PH Beauty Labs Inc., 2009 WL 2489223 *2 (C.D. Cal. 2009).

In 2008, the Supreme Court found that the "possibility of irreparable harm" standard was too lenient, and held that a plaintiff must demonstrate that irreparable injury is "likely in the absence of an injunction." Winter v. Natural Resources Defense Council, Inc., 129 S.Ct. 365, 375 (2008). "Issuing a preliminary injunction based only on a possibility of irreparable harm is inconsistent with our characterization of injunctive relief as an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief." Id. at 375-376 (citing Mazurek v. Armstrong, 520 U.S. 968, 972 (1997)(per curiam)).

Accordingly, a plaintiff seeking a preliminary injunction must establish that there is a likelihood of success on the merits, that it is likely to suffer irreparable harm in the absence of injunctive relief, that the balance of equities tips in the its favor, and that an injunction is in the public interest. Id. at 374.*fn1 Because a preliminary injunction is such an extraordinary remedy, "[i]n each case, courts must 'balance the competing claims of injury and must consider the effect on each party of the granting or withholding of the requested relief.'" Winter, 129 S.Ct. at 374 (citing Amoco Production Co. v. Gambell, 480 U.S. 531, 542 (1987)).

Establishing a likelihood of confusion is the central element of proving trademark infringement, and the key issue is whether "the similarity of the marks is likely to confuse customers about the source of the products." Official Airline Guides v. Goss, 6 F.3d 1385, 1391 (9th Cir. 1993). In determining whether there is a likelihood of confusion, the Ninth Circuit looks to the so-called Sleekcraft factors, which include: (1) the similarity of the marks; (2) the relatedness of the two companies' goods; (3) the marketing channels used; (4) the strength of the plaintiff's mark; (5) the defendant's intent in selecting its mark; (6) evidence of actual confusion; (7) the likelihood of expansion into other markets; and (8) the degree of care likely to be exercised by the purchaser. GoTo.com, 202 F.3d at 1205 (citing AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348 (9th Cir. 1979)). The eight-factor test is a "pliant" one, in which "some factors are much more important than others." Brookfield Communications, Inc. v. West Coast Entertainment Corp., 174 F.3d 1036, 1054 (9th Cir. 1999). The similarity of the marks, the relatedness of the goods or services and the use of a common marketing channel, constitute "the controlling troika in the Sleekcraft analysis." GoTo.com, 202 F.3d at 1205.

III. Discussion and Analysis

A. Plaintiff Has Failed to Meet Its Burden of Showing a Likelihood of Success on the Merits

"In deciding whether to grant a preliminary injunction, a district court must consider whether the plaintiffs have demonstrated that they are likely to prevail on the merits." Ashcroft v. American Civil Liberties Union, 542 U.S. 656, 666 (2004). "Probability of success" implies that the moving party must have a very clear and strong case. McCarthy, Trademarks and Unfair Competition ยง 30:45 (4th ed.). If there is doubt as to the probability of plaintiff's ultimate success on the merits, the ...


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