United States District Court, C.D. California, Southern Division
ORDER GRANTING PLAINITFFS’ APPLICATION FOR (A)
TEMPORARY RESTRAINING ORDER; (B) ORDER TO SHOW CAUSE RE:
PRELIMINARY INJUNCTION; AND (C) EXPEDITED DISCOVERY
O. CARTER UNITED STATES DISTRICT JUDGE
the Court is Plaintiffs Hand & Nail Harmony, Inc.
(“Harmony”) and Nail Alliance, LLC’s
(“Nail Alliance”) (collectively,
“Plaintiffs”) renewed Application for: (a) Entry
of Temporary Restraining Order; (b) An Order to Show Cause
Re: Preliminary Injunction; and (c) Expedited Discovery
(“Renewed Application”) (Dkts. 15,
Plaintiffs seek a temporary restraining order
(“TRO”) against Defendants ABC Nail and Spa
Products (“ABC Nail”), Gel Nail Supply
(“Gel Nail”), Val USA Manufacturer, Inc. (a.k.a.,
Val Gel Polish Manufacture) (“Val USA”), VIP Nail
Products, Inc. (“VIP Nail”), V & V Beauty
Supplies (“V & V Beauty”), Xuan Thi Lam, Chau
Thi Ngoc Le, Anh Q. Le, Iris Zhen, Felix Tseng, Cindy Trinh,
Lindside Pham, Bryan Tran, Hai T. Nguyen, and Bao Toan Le
considered the Complaint (“Compl.”) (Dkt. 1),
Renewed Application, as well as the accompanying Memorandum
of Points and Authorities, declarations, and exhibits,
all other pleadings and proceedings of record before the
Court, the Court GRANTS the Application as set forth below.
Harmony manufactures, distributes, and sells high-quality,
soak-off gel polishes and other nail products, accessories,
and preparations under the brand name GELISH. Compl. ¶
6. Through its qualified distributors, Harmony sells GELISH
brand goods to boutiques and salons in Southern California
and throughout the world. Id. GELISH brand
foundation, gel polish, and top coat are sold in elegantly
adorned and distinctive bottles. Declaration of Garidawn
Tingler (“Tingler Decl.”) (Dkt. 8) ¶ 9.
Nail Alliance owns and holds certain intellectual property
rights used in connection with GELISH goods, including
federal trademarks for the GELISH brand. Compl. ¶¶
7, 34-35. In particular, Nail Alliance owns the rights to
United States Trademark Registration Numbers 4, 096, 115
(GELISH standard character mark), 3, 857, 946 (GELISH design
plus words), as well as the unique three-dimensional
configuration and scrollwork pattern, which is protected by
United States Trademark Registration Numbers 4, 473, 557 and
4, 473, 558 (collectively, “GELISH marks”).
Tingler Decl. ¶ 5; see Compl. Exs. 1-2. Harmony
is the exclusive, worldwide licensee of Nail Alliance as it
relates to the GELISH goods, marks, and bottle. Tingler Decl.
case centers upon allegations that Defendants are
“actively engaged in manufacturing, distributing,
selling, promoting, and/or attempting to pass off counterfeit
products and spurious imitations of Plaintiffs’
GELISH® brand nail products.” Compl. ¶ 5;
see also Id. ¶¶ 48, 50-53. Plaintiffs
contend Defendants’ counterfeit products are cheap,
low-quality masquerades that disparage Plaintiffs’
registered trademarks and inherently distinctive trade dress.
Id. ¶¶ 5, 55, 57. Plaintiffs allege
Defendants’ counterfeiting activities originate from
Garden Grove, Westminster, and the City of Industry and that
such activities have “manifested [themselves] in cities
and states across the nation, ” including in Orlando,
Florida; Las Vegas, Nevada; Taylor, South Carolina; and
Omaha, Nebraska. Id. ¶ 5.
has invested millions of dollars in promoting its GELISH
goods, marks, and bottles in the United States and throughout
the world. Tingler Decl. ¶ 15. In particular, Harmony
has spent millions of dollars promoting GELISH brand goods at
trade shows and over the internet. Id. Harmony has
developed and maintains a highly visited website
(www.nailharmony.com), and corporate pages on social
media sites such as Facebook. Id. ¶ 16. Harmony
has also produced online advertisements, including a video
that has been viewed by more than 2.5 million visitors.
GELISH goods incorporate the ® symbol to notify others
the mark “GELISH” is subject to federal trademark
registrations. Id. ¶ 14. The GELISH marks,
trade dress, and bottle are symbols of Harmony’s
quality, reputation, and goodwill and have never been
abandoned. Id. Moreover, the GELISH marks are
instantly recognizable and associated exclusively with
Plaintiffs in the United States and throughout the world by
consumers. Id. Indeed, consumers routinely ask for
the products by name. Id. ¶ 4. Plaintiffs state
GELISH is a famous mark in the nail industry. Id.
carefully monitors and polices the use of its intellectual
property, including the GELISH marks, both in the United
States and around the world. Id. ¶¶ 18-20;
see also Supplemental Declaration of Garidawn
Tingler (“Supp. Tingler Decl.”) (Dkt. 17) ¶
6. The “continuing and growing success of the GELISH
brand has attracted numerous counterfeit, knock-off, and
other spurious products attempting to tradeoff the goodwill
and reputation of Harmony’s Products.” Tingler
Decl. ¶ 19; Supp. Tingler Decl. ¶ 7. In this case,
Harmony states Defendants sell cheap, low-quality foundation
and top coat that are mislabeled and sold as GELISH brand
foundation and top coat (the “counterfeit
product”). See Tingler Decl. ¶ 24;
Declaration of Jim Phan (“Phan Decl.”) (Dkt. 9)
¶¶ 6-8, Id. Exs. 1-2. Defendants’
counterfeit product is sold or offered for sale in bottles
with nearly identical labels. See Tingler Decl.
¶ 11, Fig. 2; Phan Decl. Exs. 3-6; Renewed App. at 5.
Given the similarity between the genuine GELISH goods and the
counterfeit product, the unavoidable conclusion is that
consumers presented with the counterfeit product will be
confused about its source.
counterfeit product is of inferior quality. See
Tingler Decl. ¶¶ 37-38; Supp. Tingler Decl. ¶
4. The counterfeit product originates from sources in China.
See Supp. Tingler Decl. ¶¶ 4, 7-10. The
Chinese government does not follow or enforce the standards
imposed on companies in the United States. See
Declaration of Sunil Sirdesai (“Sirdesai Decl.”)
(Dkt. 18) ¶¶ 4, 7. Defendants generally sell the
products at steeply discounted prices. See Tingler
Decl. ¶ 29, Phan Decl. Exs. 1-2.
the Defendants are direct distributors of Harmony’s
GELISH brand products, and none of them have a license to use
the mark GELISH to promote any product not manufactured by
Harmony. See Tingler Decl. ¶¶ 5-6.
their Complaint, Plaintiffs allege the following claims: (1)
trademark infringement and counterfeiting in violation of 15
U.S.C. §§ 1114, 1116(d), id. ¶¶
61-72; (2) false designation of origin, false descriptions,
unfair competition and dilution under 15 U.S.C. § 1125,
id. ¶¶ 73-88; and (3) unfair competition
in violation of California Business & Professions Code
§ 17200, id. ¶¶ 89-95.
commenced this action on May 27, 2016. See generally
Compl. Also on May 27, 2016, Plaintiffs filed their original
Ex Parte Application for: (a) Entry of Temporary
Restraining Order and Seizure Order; (b) Order to Show Cause
Re: Preliminary Injunction; (c) A Substitute Custodian Order;
and (d) An Order for Expedited Discovery (“Original
Application”) (Dkt. 7). On May 31, 2016, the Court
denied without prejudice Plaintiffs’ Original
Application (“Order Denying Original
Application”) (Dkt. 14).
filed their Renewed Application on June 8, 2016, requesting
the Court issue a TRO, an order to show cause, and grant
Plaintiffs’ request for expedited discovery. Although
Plaintiffs previously sought a TRO without notice, Plaintiffs
have provided Defendants ABC Nail, Gel Nail, Val USA, VIP
Nail, V & V Beauty, Xuan Thi Lam, Chau Thi Ngoc Le, An Q.
Le, Iris Zhen, Felix Tseng, Cindy Trinh, Lindside Pham, Bryan
Tran, Hai T. Nguyen, and Bao Toan Le, against whom they seek
a TRO, with notice of the Renewed Application. See
Proof of Service (Dkt. 21) at 1-3; Proof of Service (Dkt. 22)
at 1-2. Despite receiving notice, as of the date of this
Order, none of the Defendants have filed a response or
Opposition to the Renewed Application.
Temporary Restraining Order
standards for issuing a temporary restraining order
(“TRO”) and a preliminary injunction are
“substantially identical.” Stuhlbarg
Int’l Sales Co. v. John D. Brushy & Co., 240
F.3d 832, 839 n.7 (9th Cir. 2001). A preliminary injunction
is an “extraordinary remedy.” Winter v.
Natural Res. Def. Council, Inc., 555 U.S. 7, 24 (2008).
As explained by the Ninth Circuit in Winter, a
plaintiff seeking preliminary injunctive relief “must
establish that he is likely to succeed on the merits, that he
is likely to suffer irreparable harm in the absence of
preliminary relief, that the balance of equities tips in his
favor, and that an injunction is in the public
interest.” Am. Trucking Ass’n, Inc. v. City
of Los Angeles, 559 F.3d 1046, 1052 (9th Cir. 2009).
Alternatively, “serious questions going to the merits
and a hardship balance that tips sharply toward the plaintiff
can support issuance of an injunction, assuming the other two
elements of the Winter test are also met.”
Alliance for the Wild Rockies v. Cottrell, 632 F.3d
1127, 1132 (9th Cir. 2011) (internal quotations marks
omitted). A “serious question” is one on which
the movant “has a fair chance of success on the
merits.” Sierra On-Line, Inc. v. Phoenix Software,
Inc., 739 F.2d 1415, 1421 (9th Cir. 1984).
must be accompanied by payment of a bond “in such a sum
as the court deems proper, for the payment of such costs and
damages as may be incurred or suffered by any party who is
found to have been wrongfully enjoined or restrained.”
Fed.R.Civ.P. 65(c). “Although there is ‘no
steadfast rule as to the amount of a bond as a result of the
issuance of a preliminary injunction, ’ the Ninth
Circuit ‘gives wide discretion to the issuance of
preliminary injunction bonds, holding that’ ‘[s]o
long as a district court does not set such a high bond that
it serves to thwart citizen actions, it does not abuse its
discretion.’” SATA GmbH & Co. Kg v.
Wenzhou New Century Int’l, Ltd., No. CV
15-08157-BRO (EX), 2015 WL 6680807, at *11 (C.D. Cal. Oct.
19, 2015) (quoting Garrett v. City of Escondido, 465
F.Supp. 2d. 1043, 1059 (S.D. Cal. 2006)).
the Parties could not have already conferred as required by
Federal Rule of Civil Procedure 26(f), Plaintiff[s]
‘may not seek discovery . . . except . . . when
authorized by . . . a court order.’”
SATA, 2015 WL 6680807, at *11 (quoting Fed.R.Civ.P.
26(d)(1)). Courts employ the “good cause”
standard to determine whether expedited discovery is
warranted. Id. (citation omitted). Courts may
consider the following factors when determining whether good
cause exists: “(1) whether a preliminary injunction is
pending; (2) the breadth of the discovery requests; (3) the
purpose for requesting the expedited discovery; (4) the
burden on the defendants to comply with the requests; and (5)
how far in advance of the typical discovery process the
request was made.” Id. (citation and internal
quotation marks omitted).
Temporary Restraining Order
reviewing the Renewed Application and supporting documents,