United States District Court, S.D. California
U.G.A. NUTRACEUTICALS, S.r.l., Plaintiff,
DAVID MCMAHON d/b/a SOLANA HEALTH, Defendant.
ORDER DENYING MOTION FOR PRELIMINARY INJUNCTION [DOC.
Cathy Ann Bencivengo United States District Judge.
matter is before the Court on a motion for preliminary
injunction filed by Plaintiff U.G.A. Nutraceuticals, S.r.l.
(“U.G.A.”). The motion has been fully briefed,
and the Court deems it suitable for submission without oral
argument. For the following reasons, the motion is denied.
markets and sells a fish oil product called “Omegor
Vitality.” In 2010, U.G.A. hired Defendant David
McMahon d/b/a Solana Health (“McMahon”) to be its
exclusive United States distributor of Omegor Vitality.
Pursuant to this distribution agreement, U.G.A. would
manufacture Omegor Vitality in gel capsules contained in foil
blister packs, and then export the foil blister packs to
McMahon. McMahon would use artwork provided by U.G.A. to
print the outer box packaging and then place the foil blister
packs received from U.G.A. into the box for marketing and
resale. The outer box packaging identified the product as
Omegor Vitality manufactured by U.G.A.
point, McMahon began marketing his own fish oil supplement
called Omega TG-3. According to U.G.A., McMahon infringed the
Omegor Vitality trademark by placing foil-blister packs with
Omega TG-3 into Omegor Vitality boxes and selling them. The
complaint, filed on March 3, 2017, asserts four claims: (1)
trademark infringement under the Lanham Act, 15 U.S.C. §
1125(a); (2) false advertising under the Lanham Act; (3)
false advertising under California Business and Professions
Code §17500; and (4) unfair competition under California
Business and Professions Code §17200.
March 29, 2017, U.G.A. filed the instant motion for a
preliminary injunction. Although U.G.A. argues that the
alleged infringement is on-going, U.G.A.'s motion papers
contain little additional evidence of the extent or timing of
the infringement alleged in the complaint. However,
U.G.A.'s chairman, Gentian Selimi, submitted declarations
that on January 26, 2017, he ordered Omegor Vitality from a
third party retailer's website that sold products
obtained from McMahon, and that when he received the product,
it contained Omegor TG-3 foil blister packs. Selimi's
declarations also state, without any documentary support,
that McMahon “shows images on his website of Omegor
Vitality outer packaging, ” and that after filing this
lawsuit, McMahon “is in fact still purporting to sell
Plaintiff's OMEGOR VITALITY product.” [Doc. No. 9-2
at ¶¶ 11, 30.]
response to the motion and his answer to the complaint,
McMahon does not dispute that in 2016 he sold some boxes with
the Omegor Vitality label on the outside and Omega TG-3 fish
oil pills in foil blister packs inside, but asserts that he
did so mistakenly. He submitted a declaration that his last
shipment with these mislabeled boxes was made on August 16,
2016, to the third party retailer from whom Mr. Selimi had
purchased mislabeled pack. He also states that this mistake
stopped happening and could not happen again because in
September 2016 Omega TG-3 stopped being packaged in foil
blister packs and has been sold only in bottles since then.
He also states that this customer had the only listing he
could find trying to sell the misbranded packages and that
the customer removed the listing on March 19, 2017 and
returned the four remaining boxes on March 20, 2017.
declaration also states that the only presence of the Omegor
name on websites with which he is affiliated is a legacy
website that has not been edited or managed since 2013 and
has had zero traffic since then. He also said that there were
no public listings for Omegor products on his current sales
website, but admitted that he discovered that using the
search function on the site, a customer could access
“private” pages with old product listings.
However, no customer has made an order using those private
pages and McMahon would be unable to fill such an order
anyway because he does not carry fish oil in the packaging
described on those pages. He declared that he was unaware
that these old product listings were able to be found by the
public and deleted them on March 18, 2017.
McMahon's declaration states: “I have not, I do
not, and will not in the future, intentionally sell or
advertise fish oil capsules as PLAINTIFF's product,
Omegor Vitality fish oil capsules.” [Doc. No. 13-1 at
preliminary injunction is an extraordinary remedy never
awarded as of right. Winter v. Natural Res. Def. Council,
Inc., 555 U.S. 9, 24 (2008). “A preliminary
injunction, of course, is not a preliminary adjudication on
the merits but rather a device for preserving the status quo
and preventing the irreparable loss of rights before
judgment.” Sierra On-Line, Inc. v. Phoenix
Software, Inc., 739 F.2d 1415, 1422 (9th Cir. 1984).
Thus, injunctive relief may only be granted upon a showing of
“irreparable injury and the inadequacy of legal
remedies.” Weinberger v. Romero-Barcelo, 456
U.S. 305, 312 (1982); Stanley v. Univ. of So.
Calif., 13 F.3d 1313, 1320 (9th Cir. 1994). For party to
prevail on a motion for preliminary injunction, therefore, it
must demonstrate that: “(1) it is likely to succeed on
the merits of its claim, (2) it is likely to suffer
irreparable harm in the absence of preliminary relief, (3)
the balance of hardships tips in its favor, and (4) a
preliminary injunction is in the public interest.”
Int'l Franchise Ass'n, Inc. v. City of
Seattle, 803 F.3d 389, 399 (9th Cir. 2015) (citing
Winter, 555 U.S. at 20).
only real dispute here concerns the second requirement:
whether U.G.A. is likely to suffer irreparable harm in the
absence of a preliminary injunction. McMahon argues that
there is no such possibility because the alleged infringement
was the result of a mistake that stopped in mid-2016. U.G.A.
argues that McMahon's voluntary cessation is inadequate
because he could begin infringing again. Based on the record,
the Court is not persuaded that there is any reasonable
likelihood of future infringement, so an injunction is not
relies on cases finding that voluntary cessation does not
moot a preliminary injunction, but these cases are
distinguishable. Federal Trade Commission v. Affordable
Media, 179 F.3d 1228 (9th Cir. 1999), involved the
FTC's efforts to recover money the defendants bilked out
of investors in a Ponzi scheme and then hid in a Cook Islands
trust expressly to place the assets beyond the jurisdiction
of United States Courts. The preliminary injunction issued by
the district court required the defendants to repatriate
these assets. The defendants argued that their cessation of
the Ponzi scheme mooted the need for injunctive relief. The
Ninth Circuit, however, noted that “the Andersons'
cessation of sales has no bearing on the need to repatriate
the assets they have secreted off to the Cook Islands.”
Id. at 1237. Sierra On-Line, Inc., 739 F.2d
1415, meanwhile involved the use of disputed term, which the
defendant easily could have resumed at any time.
unlike these other cases, Defendant did not cease the alleged
infringing behavior because he was caught or in response to
the lawsuit. Rather, the last mislabeled package, which is
the only basis for U.G.A.'s claims, was sold by McMahon
in August 2016, more than six months before the lawsuit was
filed. Although the consequences of the infringement may have
been ongoing through the filing of this lawsuit because the
mislabeled packages were still available ...