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Nautical Bean Coffee Co., Inc. v. Nautical Bean, Inc.

United States District Court, Ninth Circuit

September 9, 2013

NAUTICAL BEAN COFFEE COMPANY, INC., Plaintiff,
v.
NAUTICAL BEAN, INC., Defendant.

ORDER DENYING WITHOUT PREJUDICE MOTION FOR SUMMARY JUDGMENT AND GRANTING MOTION FOR RULE 56(d) RELIEF

BARRY TED MOSKOWITZ, Chief District Judge.

On April 5, 2013, Defendant Nautical Bean, Inc., filed a motion for summary judgment. On May 31, 2013, Plaintiff filed an opposition as well as a motion to deny or continue the motion for summary judgment under Fed.R.Civ.P. 56(d). For the reasons discussed below, Plaintiff's motion for relief under Rule 56(d) is GRANTED and the Defendant's motion for summary judgment is DENIED WITHOUT PREJUDICE.

I. BACKGROUND

In 1994, John Alvarez opened Nautical Bean Cafe in Oceanside, California, and has continued to operate the business to this day. (Alvarez Decl. ¶ 5.) In or about 1999 or 2000, Alvarez began using the internet as a marketing tool for his cafe. (Id. at ¶ 7.) Alvarez registered the domain as nauticalbeancoffee.com. (Id.) Eventually, Alvarez began using the webpage to sell coffee. (Id. at ¶ 8.)

In 2003, Alvarez had his business incorporated under the name Nautical Bean Coffee Company, Inc. (Id. at ¶ 9.)

In 2009, Alvarez obtained a trademark registration (U.S. Trademark Registration No. 3622532) for the mark "NAUTICAL BEAN" in connection with cafe and restaurant services. (Ex. A to Compl.) Ownership of the registration was assigned to Nautical Bean Coffee Company, Inc., in 2012. (Ex. B to Compl.)

Defendant owns a Nautical Bean Cafe in San Luis Obispo. In 2003, Defendant purchased the business from a predecessor who obtained a San Luis Obispo business license under the name "Nautical Bean" in May 1999. (Jones Decl. ¶ 4.) In January 2003, Defendant incorporated in California under the name Nautical Bean, Inc., and began operating the Nautical Bean Cafe in San Luis Obispo on February 2, 2003. (Id. at ¶ 6.) It has operated continuously since then. (Id.)

Beginning in 2004, Defendant began operating a webpage with the domain name nauticalbean.com. (Jones Decl. ¶ 8.)

On May 17, 2012, Plaintiff commenced this action. Plaintiff's Complaint asserts claims for (1) trademark infringement under the Lanham Act, 15 U.S.C. § 1114; (2) unfair competition under the Lanham Act, 15 U.S.C. § 1125(a); (3) trademark infringement under California Law; and (4) violation of Cal. Bus. & Prof. Code § 17200.

II. DISCUSSION

Defendant moves for summary judgment, arguing that Plaintiff cannot present evidence establishing a likelihood of confusion from the use of the "Nautical Bean" name in connection with a single cafe in San Luis Obispo, which is more than 250 miles away from Plaintiff's Nautical Bean Cafe in Oceanside. Plaintiff requests that the Court deny or continue Defendant's motion for summary judgment so that Plaintiff can conduct discovery regarding issues raised by the motion for summary judgment. As discussed below, the Court finds that relief under Rule 56(d) is warranted.

Under Federal Rule of Civil Procedure 56(d), "If a nonmovant shows by affidavit or declaration that, for specified reasons, it cannot present facts essential to justify its opposition, the court may (1) defer considering the motion or deny it; (2) allow time to obtain affidavits or declarations or to take discovery; or (3) issue any other appropriate order." To prevail on a request for relief under Rule 56(d), the party opposing the motion for summary judgment must make "(a) a timely application which (b) specifically identifies (c) relevant information, (d) where there is some basis for believing that the information sought actually exists." VISA Int'l Serv. Ass'n v. Bankcard Holders of Am. , 784 F.2d 1472, 1475 (9th Cir. 1986). The burden is on the party seeking additional discovery to demonstrate Rule 56(d) applies. Blough v. Holland Realty, Inc. , 574 F.3d 1084, 1091 (9th Cir.2009).

Plaintiff has established by declarations the need for additional discovery to oppose Defendant's motion. One critical issue that Plaintiff wishes to investigate further concerns Defendant's knowledge of Plaintiff's prior use of the "Nautical Bean" mark and Defendant's intent. As explained by John Alvarez, in or about 1996, he became acquainted with Michael Brookins, a regular customer who lived in North County and expressed interest in going into the coffee business himself. (Alvarez Decl. ¶ 3.) Alvarez was happy to help, and talked to Brookins about his experiences in the business. (Alvarez Decl. ¶ 4.) Plaintiff learned through a document produced in discovery that Michael Brookins was the predecessor-in-interest from whom Defendant purchased the business. (Id.)

A scheduling order governing discovery in this case was issued on March 21, 2013. Defendant's motion for summary judgment was filed on April 5, 2013. The discovery cut-off date is not until November 22, 2013. Therefore, much discovery remains to be done. With respect to the issue of knowledge and intent, Plaintiff wishes to conduct further written discovery and deposition discovery regarding Defendant's dealings with Brookins. (Gillaspey Decl. ¶ 5.) Plaintiff is currently looking for Mr. Brookins, who may be ...


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