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Millennium Laboratories, Inc., A California Corporation v. Ameritox

October 12, 2012

MILLENNIUM LABORATORIES, INC., A CALIFORNIA CORPORATION,
PLAINTIFF,
v.
AMERITOX, LTD., A TEXAS LIMITED PARTNERSHIP, DEFENDANT.



The opinion of the court was delivered by: Hon. Michael M. Anello United States District Judge

ORDER DENYING DEFENDANT'S DEFINITE STATEMENT MOTION TO DISMISS, OR, IN THE ALTERNATIVE, FOR MORE [Doc. No. 9]

Pending before the Court is Defendant Ameritox, LTD's ("Ameritox") motion to dismiss Plaintiff Millennium Laboratories, Inc's ("Millennium") complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6), or, in the alternative, for a more definite statement under Rule 12(e). [Doc. No. 9.] The Court, in its discretion, took the matter under submission pursuant to Civil Local Rule 7.1(d)(1). Having considered the briefs, and for the reasons stated herein, the Court DENIES Defendant's motions.

BACKGROUND

Plaintiff Millennium is a specialty diagnostics laboratory which provides services to the chronic pain market. [Compl., Doc. No. 1, ¶ 3.] A key service of Millennium is providing reports to physicians relating to the results of laboratory tests performed by Millennium. [Id. ¶ 6.] In 2011, Millennium re-designed its reports to include a specific combination of graphs and charts.

[Id.] This combination includes: (1) a bell curve showing the distribution of results from all patients with a prescription for a medication who tested positive for that medication, as well as the test result for the individual patient prescribed that same medication; and (2) a timeline showing the test result for the individual patient along with the patient's recent prior test results for the same prescribed medication. [Id.] Millennium designed a report for physicians where the above-described information is shown pictorially. [Id. ¶ 7.] When the new reports were introduced in June 2011, Millennium's customers immediately expressed strongly favorable opinions. [Id. ¶ 8.] Millennium alleges this report format constitutes a trade dress, which has become a valuable asset of Millennium, symbolizing its high quality services and goodwill. [Id. ¶ 9.]

Defendant Ameritox is Millennium's direct competitor in the market for urine and saliva-based drug testing. [Id. ¶ 14.] Plaintiff alleges that Ameritox has offered for sale "confusingly similar reports that copy Millennium's trade dress." [Id. ¶ 10.] "By providing infringing reports to practitioners who must decide whether to utilize Millennium or Ameritox's services, Ameritox is attempting to win, and . . . has won business that otherwise would have been captured by Millennium." [Id. ¶ 15.]

On April 30, 2012, Millennium filed the instant complaint alleging infringement of its trade dress and violation of California's unfair business competition law. On June 22, 2012, Ameritox filed a motion to dismiss for failure to state a claim, or, in the alternative, for a more definite statement. [Doc. No. 9.] Millennium opposes the motion, arguing that its complaint contains the necessary elements to state a valid claim of trade dress infringement.

DISCUSSION

I. Motion to Dismiss

A Rule 12(b)(6) motion to dismiss tests the sufficiency of the complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). "While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the grounds of [her] entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do. Factual allegations must be enough to raise a right to relief above the speculative level." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)

(internal quotation marks, brackets and citations omitted).

In reviewing a motion to dismiss under Rule 12(b)(6), the court must assume the truth of all factual allegations and must construe them in the light most favorable to the nonmoving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996). Legal conclusions need not be taken as true merely because they are cast in the form of factual allegations. Roberts v. Corrothers, 812 F.2d 1173, 1177 (9th Cir. 1987); W. Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981). Similarly, "conclusory allegations of law and unwarranted inferences are not sufficient to defeat a motion to dismiss." Pareto v. Fed. Deposit Ins. Corp., 139 F.3d 696, 699 (9th Cir. 1998).

A claim has "facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft. v. Iqbal, 556 U.S. 662, 678 (2009). "The plausibility standard is not akin to a 'probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." Id. "Where a complaint pleads facts that are 'merely consistent with' a defendant's liability, it ...


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