ROBANDA INTERNATIONAL, INC., a California Corporation, Plaintiff,
NINA PARKINSON, et al., Defendants.
ORDER DENYING DEFENDANT'S MOTION TO DISMISS AND REQUIRING PLAINTIFF TO SHOW CAUSE WHY COMPLAINT SHOULD NOT BE DISMISSED
BARRY TED MOSKOWITZ, Chief District Judge.
On May 2, 2013, Defendant Nina Parkinson filed a motion to dismiss Plaintiff's Complaint. (ECF No. 7.) For the reasons discussed below, Defendant's motion is DENIED.
I. FACTUAL BACKGROUND
On March 1, 2013, Plaintiff Robanda International, Inc. ("Plaintiff") filed a Complaint against Defendants Nina Parkinson, Plasticos Vandux de Colombia, and Camelot Hair Care Products. (ECF No. 1.) Plaintiff manufactures a line of hairbrushes under the brand name "Marilyn, " a registered trademark with the United States Patent and Trademark Office ("USPTO"). (Compl. ¶ 9.) In 2009, Plaintiff acquired the Marilyn brushes through an asset purchase agreement ("APA") with Camelot. (Id. ¶ 10.) Pursuant to the APA, Plaintiff was given a license to use the Marilyn trademark ("Marilyn Mark") and is scheduled to receive exclusive ownership of the Marilyn Mark in 2014. (Compl. ¶ 11.)
Camelot assigned to Nina Parkinson ("Defendant") the rights to the Marilyn Mark in 2008. (Compl. ¶ 15.) Thus, although Plaintiff purchased the Marilyn brushes from Camelot, Plaintiff required the authorization of Defendant to sell the brushes under the Marilyn Mark. On December 1, 2008, Defendant authorized Plaintiff to have the complete and free use of the Marilyn Mark for 5 years through a license agreement. (Compl., Ex. B.) Although the license agreement outlines quality control procedures allowing Defendant to supervise Plaintiff's use of the Marilyn Mark, Plaintiff alleges that the Marilyn Mark has been used exclusively and continuously by Plaintiff since 2009, without any supervision from Defendant. (Compl. ¶ 25.)
Plaintiff's Complaint seeks the following: (1) declaratory judgment of ownership of the trademark MARILYN, Registration No. 2, 732, 910; and (2) cancellation of the remaining Marilyn trademarks, Registration Nos. 3, 571, 144 and 3, 621, 392.
II. LEGAL STANDARD
A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) should be granted only where a plaintiff's complaint lacks a "cognizable legal theory" or sufficient facts to support a cognizable legal theory. Balistreri v. Pacifica Police Dept. , 901 F.2d 696, 699 (9th Cir. 1988). When reviewing a motion to dismiss, the allegations of material fact in plaintiff's complaint are taken as true and construed in the light most favorable to the plaintiff. See Parks Sch. of Bus., Inc. v. Symington , 51 F.3d 1480, 1484 (9th Cir. 1995).
Although detailed factual allegations are not required, factual allegations "must be enough to raise a right to relief above the speculative level." Bell Atlantic v. Twombly , 550 U.S. 544, 555 (2007). "A plaintiff's obligation to prove the grounds' of his entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Id . "[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not show[n]-that the pleader is entitled to relief." Ashcroft v. Iqbal , 556 U.S. 662, 679 (2009) (internal quotation marks omitted).
In her motion to dismiss, Defendant argues that Plaintiff cannot show that Defendant abandoned the Marilyn Mark because Plaintiff's use of the mark inures to Defendant's benefit as the licensor, and because Defendant exercised quality control. Defendant also argues that there is no real and immediate controversy because Plaintiff cannot allege abandonment while Plaintiff is using the Marilyn Mark, since Plaintiff's present use inures to Defendant's benefit and there is therefore no abandonment while Plaintiff is using it under the licensing agreement. Defendant also argues that Plaintiff's claim of ownership is barred by collateral estoppel.
Plaintiff argues in opposition that the original transfer of the Marilyn Mark from Camelot to Defendant was an invalid assignment in gross, because the Marilyn Mark was not transferred with any assets or goodwill. Plaintiff also argues that Defendant did not in fact exercise quality control, despite her contractual right to do so.
Finally, in her reply brief, Defendant raised for the first time the argument that Plaintiff is barred from bringing suit pursuant ...