United States District Court, S.D. California
BULLETS2BANDAGES, LLC, a California limited liability company, Plaintiff,
CALIBER CORPORATION, an Illinois corporation, Defendant. CALIBER CORPORATION, an Illinois Corporation, Counterclaim-Plaintiff,
BULLETS2BANDAGES, LLC, a California limited liability company, Counterclaim-Defendant, CALIBER CORPORATION, an Illinois Corporation, Third-Party Plaintiff,
LUCKY SHOT USA LLC, a Florida Limited Liability Company; and 2 MONKEY TRADING, LLC, a Florida Limited Liability Company, Third-Party Defendants, LUCKY SHOT USA LLC, a Florida Limited Liability Company; and 2 MONKEY TRADING LLC, a Florida Limited Liability Company, Third- Party Counterclaim-Plaintiffs,
CALIBER CORPORATION, an Illinois Corporation, Third Party Counterclaim-Defendant.
ORDER GRANTING CALIBER'S MOTION FOR LEAVE TO FILE
AMENDED COUNTERCLAIMS AND THIRD-PARTY CLAIMS [DKT. NO.
Gonzalo P. Curiel United States District Judge
the Court is Defendant/Counterclaim Plaintiff/Third-Party
Plaintiff/Third Party Counterclaim-Defendant Caliber
Corporation's motion for leave to file an Amended
Counterclaim and Third-Party Claim. (Dkt. No. 64.) Third
Party Defendant/Third Party Counterclaim Plaintiff 2 Monkey
Trading LLC and Plaintiff/Counterclaim-Defendant
Bullets2Bandages, LLC filed an opposition. (Dkt. No. 77.)
Caliber filed a reply. (Dkt. No. 84.) Based on the reasoning
below, the Court GRANTS Caliber's motion for leave to
file an Amended Counterclaim and Third Party Complaint.
Bullets2Bandages, LLC (“B2B”) and Defendant
Caliber Corporation (“Caliber”) are both in the
business of selling bullet-shaped bottle openers. (Dkt. No.
41, Counterclaim ¶ 14; Case No. 13cv3134-CAB(BLM), Dkt.
No. 1, Compl. ¶ 11.) On December 20, 2013, in Case No.
13cv3134-CAB(BLM), B2B filed a complaint against Caliber for
trademark infringement of B2B's U.S. Trademark
Registration No. 4, 364, 453 for the CALIBER mark as well as
a federal unfair competition, and California statutory and
common law unfair competition claims. (Case No.
13cv3134-CAB(BLM), Dkt. No. 1, Compl.) In turn, Caliber filed
a counterclaim against B2B for unfair competition based on
B2B's wrongful use of the CALIBER mark and wrongful use
of Caliber's Bullet Trade Dress, cancellation of the CALIBER
mark, false or fraudulent registration, and
trademark infringement and unfair competition under
California law. (Id., Dkt. No. 15, Caliber's
9, 2014, B2B and Caliber entered into a Settlement Agreement
in Case No. 13cv3134-CAB(BLM), effective April 7, 2014, where
B2B assigned to Caliber all rights to the CALIBER Mark, U.S.
Trademark Registration No. 4, 364, 453, agreed to withdraw
its opposition to Caliber's registration of the Bullet
Trade Dress and agreed not to use the phrase
“the original” in connection with the sale of
bullet-shaped bottle openers. (Dkt. No. 41, Counterclaim
¶ 23; id., Ex. 2.) In exchange, Caliber agreed
to grant B2B a worldwide, nonexclusive license to the Bullet
Trade Dress and to “B2B's then-current use of the
word ‘Caliber'”. (Id. ¶ 23;
Dkt. No. 1, Compl. ¶ 9.)
Complaint alleges that B2B, relying on its rights under the
Settlement Agreement, manufactures products that it then
sells to wholesalers, such as 2 Monkey Trading, LLC (“2
Monkey”) (a/k/a Lucky Shot) who sells the products
directly to consumers. (Dkt. No. 1, Compl. ¶ 11.) 2
Monkey sells B2B's products through Amazon and Etsy.
(Id.) B2B learned that someone complained that 2
Monkey's products were infringing. (Id. ¶
12.) Due to the complaints, Amazon and Etsy removed 2
Monkey's listings from their websites, barring it from
engaging in any sales of B2B's products. (Id.)
suspected Caliber complained to Amazon and Etsy and when it
contacted Caliber, it was slow to respond despite the
substantial financial damage to B2B for 2 Monkey's
inability to sell its products. (Id. ¶¶
14-16.) Caliber then told B2B that it was disappointed that
B2B had signed an agreement with 2 Monkey. (Id.
¶ 17.) Instead of raising an issue concerning the
Settlement Agreement, it asked B2B to repudiate its agreement
with 2 Monkey so that B2B and Caliber could work together to
make 2 Monkey pay a higher rate. (Id.) Caliber also
threatened that it would begin licensing the CALIBER Mark and
Bullet Trade Dress to anyone so that the market would be
flooded ultimately taking sales away from B2B and 2 Monkey.
(Id. ¶ 18.)
on April 3, 2018, B2B filed the underlying Complaint against
Caliber for breach of contract, interference with existing
contractual relations, interference with prospective economic
advantage and unfair competition under California Business
& Professions Code section 17200 et seq. (Dkt.
No. 1, Compl.)
Caliber's Counterclaim and Third-Party Complaint alleges
that following the execution of the Settlement Agreement,
Caliber manufactured large caliber bullet-shaped bottle
openers for third parties including, 2 Monkey. (Dkt. No. 41,
Counterclaim ¶ 36.) On or after April 7, 2017, Caliber
told 2 Monkey that it could offer a nonexclusive license to
its Bullet Trade Dress. (Id. at ¶ 37.) 2 Monkey
then ceased purchasing product from Caliber and expressed an
interest in obtaining a license for sale of products bearing
the Bullet Trade Dress. (Id. ¶ 38.) During the
remainder of 2017, 2 Monkey continued to independently
purchase and/or manufacture bullet-shaped bottle openers.
(Id. ¶ 39.) Around April 2017, 2 Monkey
contracted with Triton Welding & Machine Shop located in
Cocoa, Florida to cut openings in .50 caliber shell casings
and contracted with Orlando Contract Packaging located in
Altamonte Springs, Florida to assemble .50 caliber bottle
openers. (Id. ¶ 40.) 2 Monkey then de-burred
and polished the bottle openers, itself, and sold them to
others through Lucky Shot. (Id.) 2 Monkey knew it
needed a license to the Bullet Trade Dress and engaged in
negotiations with Caliber throughout 2017 and early 2018
regarding a license for the sale of large caliber bottle
openers. (Id. ¶ 42.) On January 25, 2018, after
making a requested change by 2 Monkey to the agreement,
Caliber believed they had an agreement. (Id. ¶
43.) But 2 Monkey delayed execution of the agreement.
(Id. ¶ 44.) On February 23, 2018, 2 Monkey told
Caliber that it would purchase products from B2B instead of
Caliber. (Id. 45.) Because they did not enter into a
license agreement, 2 Monkey's prior sales of
bullet-shaped bottle openers since April 2017 were
unlicensed, unauthorized and counterfeit. (Id.
February 23, 2018, 2 Monkey entered into a Manufacturing
Agreement with B2B without Caliber's knowledge, and on
that day, 2 Monkey placed its first order of 5, 000 .50
caliber bullet-shaped bottle openers and other bullet-shaped
bottle openers. (Id. ¶ 47.) As a result,
Caliber notified Amazon and Etsy on February 23, 2018 that
Lucky Shot's then-existing product was infringing its
Bullet Trade Dress. (Id. ¶ 48.) B2B did not
obtain Caliber's consent to transfer rights to the Bullet
Trade Dress or CALIBER mark to 2 Monkey or Lucky Shot.
(Id. ¶ 49.) Lucky Shot continues to list
bullet-shaped bottle openers on its own website, Amazon.com
and Etsy.com without a license from Caliber. (Id.
¶ 50.) Lucky Shot also uses the phrase “the
original” without a license from Caliber. (Id.
¶ 51.) B2B continues to use the phrase “the
original” in connection with the sale of bullet-shaped
bottle openers without a license from Caliber. (Id.
¶ 52.) Amazon and Etsy removed specific listings of
Lucky Shot to comply with their policies on sale of
infringing and/or counterfeit products. (Id. ¶
53.) On March 1, 2018, B2B contacted Caliber demanding that
the take-down notices be withdrawn explaining that all 2
Monkey/Lucky Shot products were being manufactured by B2B as
of Monday, February 26, 2018. (Id. ¶ 56.) In
response, Caliber sought a copy of the Manufacturing
Agreement that was heavily redacted but confirmed that B2B
and 2 Monkey/Lucky Shot entered into a sublicense agreement.
(Id. ¶ 60.) Moreover, invoices related to the
production of bottle openers for 2 Monkey were produced
indicating that B2B subcontracted with Triton Welding &
Machine Shop, Inc. and Orlando Contract Packaging, the same
companies 2 Monkey hired directly to manufacture bottle
openers from April 2017 to February 2018. (Id.
¶¶ 61-62.) Caliber also requested the pricing
information in the Manufacturing Agreement and purchase
documents that verify that B2B is the manufacturer but B2B
and 2 Monkey refused. (Id. ¶¶ 65, 66.)
Therefore, Caliber is unable to determine whether the Lucky
Shot bullet-shaped bottle openers on Amazon and Etsy are
counterfeit, non-infringing or produced under the settlement
agreement with B2B. (Id. ¶ 67.)
on these facts, on April 27, 2018, Defendant Caliber filed
its Answer and a Counterclaim against B2B for breach of
contract, interference with prospective economic advantage
and negligent misrepresentation, unfair competition, two
counts of federal unfair competition pursuant to 15 U.S.C.
§ 1125(a) for the CALIBER and ORIGINAL marks, and two
counts of trademark infringement of U.S. Registration No. 4,
930, 487 (THE ORIGINAL .50 CALIBER BOTTLE OPENER) and the
U.S. Registration No. 4, 364, 453 (CALIBER) pursuant to 15
U.S.C. § 1114. (Dkt. No. 5.) Caliber also filed a
Third-Party Complaint (“TPC”) against Third Party
Defendants Lucky Shot and 2 Monkey. (Id.) In the
TPC, Caliber alleges eight causes of action of common law
unfair competition, three counts of trademark infringement of
U.S. Registration No. 4, 630, 557 (Bullet Design mark), U.S.
Registration No. 4, 364, 453 (CALIBER) and U.S. Registration
No. 4, 930, 487 (ORIGINAL .50 CALIBER BOTTLE OPENER) pursuant
to 15 U.S.C. § 1114; three counts of federal unfair
competition pursuant to 14 U.S.C. § 1125(a), and
counterfeiting. (Dkt. No. 5 at 22-29.)
8, 2018, B2B filed its Answer to Caliber's Counterclaims.
(Dkt. No. 22.) On August 7, 2018, Third Party Defendants
filed their Answer to the TPC and filed a Third-Party
Counterclaim. On August 28, 2018, Caliber filed its answer to
the Third-Party Defendants' Counterclaim. (Dkt. No. 30.)
January 9, 2019, the Court granted Caliber's unopposed
motion for leave to file an Amended Answer, Counterclaims and
Third-Party Complaint due to a typographical error. (Dkt.
Nos. 37, 39, 40.) On January 10, 2019, Caliber filed the
operative Amended Answer, Counterclaims and Third-Party
Claims. (Dkt. No. 41.) On January 24, 2019, Third Party
Defendants filed an Answer to the Third-Party Complaint and
Counterclaim as well as their Third Party Counterclaims
against Caliber seeking a declaration that trademark
registration no. 4, 630, 557 (Bullet Trade Dress) is invalid,
cancellation of federal trademark registration No. 4, 630,
557 (Bullet Trade Dress), cancellation of federal trademark
registration No. 4, 364, 453 (CALIBER mark), and cancellation
of federal trademark registration No. 4, 930, 487 (ORIGINAL
mark). (Dkt. No. 42 at 15-22.)
deadline for the completion of fact discovery in this case
was May 10, 2019 and expert discovery deadline was September
13, 2019. (Dkt. No. 35 at 2-3.) Summary judgment motions were
filed by all parties on October 28, ...