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Morton & Bassett, LLC v. Organic Spices, Inc.

United States District Court, N.D. California

September 1, 2017

MORTON & BASSETT, LLC, Plaintiff,
v.
ORGANIC SPICES, INC., Defendant.

          ORDER GRANTING IN PART, DENYING IN PART, AND DEFERRING IN PART THE MOTIONS IN LIMINE RE: DKT. NOS. 97-100, 102-106, 109-5

          HAYWOOD S. GILLIAM, JR., United States District Judge

         Plaintiff Morton Bassett L.P. (“Morton”) and Defendant Organic Spices, Inc. (“Spicely”) each have filed five motions in limine. Dkt. Nos. 97-100, 102-06, 109-5. At the pretrial conference on June 15, 2017, the Court heard argument on the motions. Dkt. No. 138 (“Hr'g Tr.”) at 16:16-17:6, 35:17-54:10. The Court GRANTS in part, DENIES in part, and DEFERS in part the motions in limine.

         I.RULINGS FROM THE BENCH

         At the pretrial conference, the Court ruled as follows for the reasons stated on the record:

Motion in Limine

Dkt. No.

Court's Ruling

Hr'g Tr. Citation

Morton's Fourth

99

Denied as unnecessary.

37:20-38:7.

Spicely's First

102

Denied as untimely motion for summary judgment.

16:16-17:6, 35:22-24.[1]

Spicely's Fourth

105

Denied as untimely motion for summary judgment.

16:16-17:6, 36:16-19.[2]

         The Court now turns to the motions in limine that remain pending.

         II. MORTON'S FIRST MOTION IN LIMINE

         Morton's First Motion in Limine seeks to “preclude evidence of, reference to, or argument regarding settlement communications between counsel for [Morton] and counsel for [Spicely] prior to [Spicely's] filing of this case.” Dkt. No. 100. The asserted grounds for exclusion are Federal Rule of Evidence (“FRE”) 403 and FRE 408. Id. Spicely does not dispute that the communications in question were settlement communications, but argues that they should not be excluded under either FRE 403 or FRE 408. Dkt. No. 123.

         A. Facts

         Prior to the filing of this case, counsel for the parties engaged in various settlement communications from February to May 2014, as described below.

         i. February 25, 2014 Letter from Spicely's Counsel

         On February 25, 2014, Spicely's counsel sent a letter to Morton's counsel. Dkt. No. 100, Ex. A.[3] The letter listed four prior communications: three letters exchanged by Morton's counsel and Spicely's counsel, dated between February 12 and February 19, 2014, as well as a phone call between Morton's counsel and Spicely's counsel on February 19, 2014. Id. at 1.

         The February 25 letter stated that Spicely was “convinced that there is no trade dress infringement and no likelihood of consumer confusion between the Morton . . . jar and the Spicely jar that were pictured in the . . . February 12 Letter [from Morton's counsel to Spicely's counsel].” Id. After making supporting arguments, the February 25 letter noted that Spicely had “been contemplating redesigning [its] product package to a more modern look” and attached samples of the preliminary designs. Id. at 3. Spicely stated its willingness to provide the “final new design” within a couple of weeks. Id. Finally, Spicely made the following offer:

Subject to exhausting sales of the Spicely Jar existing in our inventories (including containers that are already printed with the existing design) within the next six (6) months, our client is willing to discontinue sales of the Spicely Jar in its existing design and implement the final new design. We hope this amicably concludes this matter.

Id.

         ii. March 12, 2014 Letter from Spicely's Counsel

         On March 12, 2014, Spicely's counsel sent a short letter to Morton's counsel, enclosing “images of the sample final new product package design.” Id., Ex. C.[4]

         iii. March 12, 2014 Letter from Morton's Counsel

         Also on March 12, 2014, Morton's counsel responded to the February 25 letter. Id., Ex. B. The letter “strongly disagree[d]” with the statements regarding infringement and consumer confusion, but stated that Morton was “encouraged that Spicely is prepared to discontinue its use of the Spicely Jar.” Id. at 1. The letter stated that Morton would only consider the matter resolved if Spicely agreed to “immediately cease all advertising, sales, and distribution of the Spicely Jar.” Id. Morton's counsel also “enclosed a draft complaint that we are prepared to finalize and file if we do not receive [Spicely's] written agreement to immediately and permanently cease all use of the Spicely jar.” Id. at 1-2.

         iv. March 17, 2014 Letter from Spicely's Counsel

         On March 17, 2014 Spicely's counsel responded to the March 12 letter from Morton's counsel. Id., Ex. D. Spicely's counsel stated that “Spicely will do everything reasonably possible to transition its design from its old design to its new design by June 16, 2014, ” but stated that “[f]ull commercial implementation of the new design is an entirely different matter.” Id. at 1. He warned that “[a]ny attempt to try to compel [Spicely] to make a transition any quicker would be ill advised.” Id. He contended that Morton's product packaging was “generic in shape and overall trade dress, ” and that “[e]ven if [Morton] were able to prove distinctive trade dress, it would not be entitled to any form of injunctive relief that would hasten Spicely's transition to a new design.” Id. at 1-2.

         v. March 28, 2014 Letter from Morton's Counsel

         On March 28, 2014, Morton's counsel responded to the March 17 letter. Id., Ex. E. He stated that “[w]hile Morton . . . remains encouraged that Spicely will be discontinuing its infringing Spicely Jar, it is not willing to allow Spicely three additional months to continue using [Morton's] distinctive trade dress.” Id. at 1. Nonetheless, he stated that Morton was “hopeful that the dispute can be resolved amicably, and out of court. It is willing to provide Spicely until no later than May 1, 2014 to exhaust all remaining inventory of the Spicely Jar, and to discontinue producing, selling, distributing, and advertising it.” Id. at 1.

         Finally, the letter requested that Spicely enter into a written settlement agreement:

In order to complete this matter, we will need Spicely to enter into a written agreement promising to cease all use of the Spicely Jar by May 1, 2014. Attached is an agreement for you to review. If Spicely agrees to these terms, please have its principal sign and date it, and we will return a fully signed copy, and forebear from filing suit. We would appreciate a response by no later than Wednesday, April 2, 2014.

Id.

         vi. April 3, 2014 Letter from Spicely's Counsel

         On April 3, 2014, Spicely's counsel responded to the March 28 letter. Id., Ex. F. He stated that Spicely “will advance its transition to a new ...


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