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Greenlight Financial Services, Inc., et al. v. Internet Brands

January 13, 2012

GREENLIGHT FINANCIAL SERVICES, INC., ET AL.
v.
INTERNET BRANDS, INC., ET AL.



The opinion of the court was delivered by: The Honorable David O. Carter, Judge

CIVIL MINUTES - GENERAL

Julie Barrera Not Present Courtroom Clerk Court Reporter

ATTORNEYS PRESENT FOR PLAINTIFFS: ATTORNEYS PRESENT FOR DEFENDANTS: NONE PRESENT NONE PRESENT

PROCEEDING (IN CHAMBERS): ORDER (1) GRANTING DEFENDANTS' MOTION TO DISMISS CLAIMS TWO THROUGH TEN AND (2) DISMISSING CLAIM ONE WITHOUT PREJUDICE TO REFILING IN STATE COURT

Before the Court is Defendants' Motion to Dismiss Claims 2-10 of the Complaint (Dkt. The Court finds this matter appropriate for decision without oral argument. Fed. R. Civ. P. 78; L.R. 7-15. Accordingly, the motion is REMOVED from the Court's January 23, 2012 calendar.

After considering the moving, opposing and reply papers, and for the reasons stated below, the Court hereby GRANTS the Motions to Dismiss (Dkt. 8). The Court also GRANTS Defendants' unopposed request for judicial notice (Dkt. 9).

I. BACKGROUND

Since 2001, Plaintiff Greenlight Financial Services, Inc. ("Greenlight") has become one of the fastest growing direct mortgage lenders in the country and it continues to grow. (FAC ¶ 13.) Plaintiff OTC Pacific, LLC ("OTC") is the registered owner of federal trademark registration nos. 1,913,751 for GREENLIGHT and 3,174,694 for GREENLIGHT FINANCIAL SERVICES (collectively, the "Greenlight Marks"). (Id. ¶ 12.) OTC has an exclusive license with Greenlight which grants Greenlight the exclusive right to use and enforce the GREENLIGHT mark. (Id. ¶ 16.)

Plaintiffs allege that Defendants Internet Brands, Inc. dba Carsdirect.com ("IB"), Carsdirect Mortgage Services, Inc. dba Loanstore.com ("CMS") and CD1Financial.com, LLC ("CD1") are in the internet marketing business and create and manage over one hundred websites that provide advertisements for various goods, or offer goods or services to the public. (Id. ¶ 17.) Defendants own the website www.greenlight.com. (Id. ¶ 18.)

In 2005, Greenlight sued Defendants in this Court in Case No. SA CV 05-545-AHS(ANx) ("First Action"). In the First Action, Greenlight asserted claims for federal trademark infringement under 15 U.S.C. §§ 1114, et seq., federal unfair competition and false designation of origin under 15 U.S.C. § 1125(a), federal trademark dilution under 15 U.S.C. § 1125, registered trademark infringement under Cal. Bus. & Prof. Code § 14335, injury to business reputation under Cal. Bus. & Prof. Code § 14330, unfair competition and false designation of origin under Cal. Bus. & Prof. Code §§ 17200 and 17500, illegal use of lender name in solicitation for financial services under Cal. Civ. Code §§ 14700, et seq., common law unfair competition, common law trademark infringement, and constructive trust. (Defs.' Request for Judicial Notice ("RJN") Ex. C, Complaint in First Action.)

After the Court granted Greenlight a preliminary injunction, the parties reached a settlement and filed a joint request to dismiss all claims and the counterclaim in the First Action with prejudice. (Defs.' RJN Ex. C, Stipulation to Dismiss Action with Prejudice.) In the settlement agreement, Greenlight agreed that Defendants would continue using Greenlight.com, but Defendants would be required to display an introductory screen showing visitors how to get to Greenlight's website for financial services. Specifically, the introductory screen was to contain links to Autos.com, LoanStore, and www.greenlightloans.com. (FAC ¶ 26.)

In the current action, Plaintiffs allege that in July 2011, they discovered that Defendants were not using Greenlight.com in accordance with the terms of the parties' settlement agreement. (Id. ¶ 27.) Plaintiffs maintain that Defendants are now displaying advertising links on Greenlight.com that are either in direct competition with Greenlight's business or were so similar in descriptive services that they would confuse the public away from Greenlight and Greenlight's services. (Id. ¶ 29.) The instant suit asserts claims for: (1) breach of contract based on breach of the settlement agreement, (2) cybersquatting under 15 U.S.C. § 1125(d), (3) federal trademark infringement under 15 U.S.C. §§ 1114,

, (4) federal unfair competition and false designation of origin under 15 U.S.C. § 1125(a), (5) registered trademark infringement under Cal. Bus. & Prof. Code § 14335, (6) unfair competition and false designation of origin under Cal. Bus. & Prof. Code §§ 17200 and 17500, (7) illegal use of lender name in solicitation for financial services under Cal. Civ. Code §§ 14700, et seq., (8) common law unfair competition, (9) common law trademark infringement, and (10) constructive trust. (Dkt. 1, Complaint filed 11/1/2011.)

Defendants filed the instant motion seeking dismissal of Plaintiff's second through tenth causes of action on the grounds that they are barred by res judicata due to the Court's dismissal ...


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