Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_07-cv-00396/USCOURTS-cand-4_07-cv-00396-3/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1331 Fed. Question

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

STUDIO RED INCORPORATED,

Plaintiff,

v.

ROCKWELL ARCHITECTURE PLANNING AND

DESIGN, P.C.,

Defendant.

 /

No. C 07-396 CW

ORDER DENYING

PLAINTIFF'S

MOTION FOR A

PRELIMINARY

INJUNCTION

Plaintiff Studio Red Incorporated moves for a preliminary

injunction. Defendant Rockwell Architecture Planning and Design,

P.C. (Rockwell Architecture), opposes the motion. The matter was

submitted on the papers. Having considered all of the papers filed

by the parties and the evidence cited therein, the Court denies

Plaintiff's motion.

BACKGROUND

Plaintiff Studio Red is an industrial design firm which has

used its name "in association with industrial design, interior

design, graphic design, graphical user interface, signage,

mechanical engineering, model building, prototyping and light

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Plaintiff names Rockwell Architecture as the Defendant in

this case. Defendant alleges that it is a "separate and legally

unrelated entity" from Rockwell Group. Plaintiff disputes this,

noting that the Rockwell Group website includes Rockwell

Architecture as the contact. Because it appears that Rockwell

Architecture and Rockwell Group are at least related entities and

Plaintiff seeks to enjoin action by Defendant, "its successors,

assigns, officers, agents, directors, servants, employees,

salespersons, independent contractors, attorneys, corporations,

subsidiaries, all other persons or entities directly or indirectly

under its control or under common control with any of them, and all

other persons or entities in active concert or participation with

any of them," the Court finds that the issue is not relevant to the

resolution of this motion. 

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production services since the company was formed in 1983." Reply

at 4. Studio Red is headquartered in Redwood City, California. 

Rockwell Group, LLC (Rockwell Group) is "a cross-disciplinary

architecture and design firm." Opposition at 2.1 In 2003, Tucker

Viemeister, an independent consultant, was engaged by Rockwell

Group "regarding the formation of a dedicated design lab for Coca

Cola." Opposition at 2. Rockwell Group and Coca Cola formed a

design group called Studio Red at Rockwell Group (Rockwell Studio

Red). Since 2003, Rockwell Studio Red has offered branding design

services, which Defendant describes as working "with clients to

design a branding method for an existing product to create an

experience that showcases the product." Opposition 3. Defendant

states that Rockwell Studio Red "is not in the business of

designing devices or industrial products." Id. 

Plaintiff does not state when it first learned that Defendant

was using the Studio Red name. Defendant alleges that Plaintiff

contacted it by e-mail in August, 2006, asking it to stop using the

Studio Red name. Plaintiff's CEO states that he does not recall

contacting Defendant in August, 2006, but states that it was his

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"general business practice to send such e-mails when general use of

the 'Studio Red' name is brought to [his] attention." Bourgeois

Supplemental Declaration ¶ 2. Plaintiff alleges that it first

learned that Defendant was using the Studio Red name in California

from a competitor in October, 2006. Plaintiff alleges that since

that time, it has received mail and telephone calls intended for

Defendant and that it has received inquiries regarding its New York

City office, which it assumes are actually intended for Defendant. 

Plaintiff does not have a New York City office.

Plaintiff initially filed its complaint for trademark and

trade name infringement in state court on November 15, 2006. 

Defendant informed Plaintiff that it intended to remove the case to

federal court and suggested that the parties meet and confer to

attempt to resolve the issue. Defendant informed Plaintiff that it

did not believe that the two businesses were competing in the same

field. The parties agreed to meet and confer. 

Plaintiff dismissed its state case and refiled the complaint

in this Court in January, 2007. In February, 2007, Plaintiff

stipulated to an extension of time for Defendant to answer the

complaint so that the parties could meet and confer. Defendant

attempted to schedule an appointment with Plaintiff but received no

response before its answer was due on March 14, 2007. Defendant

answered the complaint and states that it continued to try to

schedule a meeting with Plaintiff's counsel. Plaintiff filed an ex

parte application for a temporary restraining order on April 9,

2007. The Court denied the application but deemed it to be a

motion for a preliminary injunction, which it now considers. 

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DISCUSSION

To obtain a preliminary injunction, the moving party must

establish either: (1) a combination of probable success on the

merits and the possibility of irreparable harm, or (2) that serious

questions regarding the merits exist and the balance of hardships

tips sharply in the moving party's favor. Rodeo Collection, Ltd.

v. West Seventh, 812 F.2d 1215, 1217 (9th Cir. 1987). 

The test is a "continuum in which the required showing of harm

varies inversely with the required showing of meritoriousness." 

Id. (quoting San Diego Comm. Against Registration & the Draft v.

Governing Bd. of Grossmont Union High Sch. Dist., 790 F.2d 1471,

1473 n.3 (9th Cir. 1986)). The moving party ordinarily must show

"a significant threat of irreparable injury," although there is "a

sliding scale in which the required degree of irreparable harm

increases as the probability of success decreases," United States

v. Odessa Union Warehouse Co-op, 833 F.2d 172, 174, 175 (9th Cir.

1987), and vice versa. To overcome a weak showing of merit, a

plaintiff seeking a preliminary injunction must make a very strong

showing that the balance of hardships is in its favor. Rodeo

Collection, 812 F.2d at 1217. 

In trademark infringement and unfair competition cases, a

reasonable showing of likelihood of success on the merits raises a

presumption of irreparable harm. LGS Architects, Inc. v. Concordia

Homes, 434 F.3d 1150, 1155-56 (9th Cir. 2006); Vision Sports, Inc.

v. Melville Corp., 888 F.2d 609, 612 n.3 (9th Cir. 1989). 

Plaintiff argues that it is likely to succeed on its trademark

claims under the Lanham Act, the California unfair competition

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statute and the common law for unfair competition. "The 'ultimate

test' for unfair competition is exactly the same as for trademark

infringement: 'whether the public is likely to be deceived or

confused by the similarity of the marks.'" Century 21 Real Estate

Corp. v. Sandlin, 846 F.2d 1175, 1178 (9th Cir. 1988) (quoting New

West Corp. v. NYM Co. of California, 595 F.2d 1194, 1201 (9th Cir.

1979)). 

The Ninth Circuit has identified eight factors that are

relevant to whether consumers are likely to confuse related goods:

(1) strength of the mark, (2) proximity of the goods, 

(3) similarity of the marks, (4) evidence of actual confusion, 

(5) marketing channels used, (6) degree of care likely to be

exercised by the purchaser, (7) evidence of bad faith intent in

selecting the mark, and (8) likelihood of expansion and overlap of

the products. AMF, Inc. v. Sleekcraft, 599 F.2d 341, 348-49 (9th

Cir. 1979). Because each of these factors is not necessarily

relevant in every case, the list of factors functions as a guide

and is neither exhaustive nor conclusive. Metro Pub., Ltd. v. San

Jose Mercury News, 987 F.2d 637, 640 (9th Cir. 1993). In fact, the

Ninth Circuit has warned against "excessive rigidity" in applying

the factors and noted that "it is often possible to reach a

conclusion with respect to likelihood of confusion after

considering only a subset of the factors." Brookfield

Communications, Inc. v. West Coast Entertainment Corp., 174 F.3d

1036, 1054 (9th Cir. 1999); see also Eclipse Associates Limited v.

Data General Corp., 894 F.2d 1114, 1118 (9th Cir. 1990) (Sleekcraft

factors "were not meant to be requirements or hoops that a district

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court need jump through to make a determination"); Murray v. Cable

National Broadcasting Co., 86 F.3d 858 (9th Cir. 1996) (finding no

likelihood of confusion after abbreviated Sleekcraft analysis). 

Plaintiff argues that there is clear evidence of actual and

potential confusion and that it is entitled to a preliminary

injunction. Defendant counters that Plaintiff has failed to

establish any of the elements required to establish that a

preliminary injunction is appropriate. First, Defendant argues

that Plaintiff has not established a protectable ownership interest

in the Studio Red name. The common law "requires a mark to have

been used in commerce before a protectible ownership interest in

the mark arises." Dep't of Parks & Rec. v. Bazaar Del Mundo, Inc.,

448 F.3d 1118, 1125 (9th Cir. 2006). Here, Plaintiff alleges that

it has used the name in association with its services and products

since founding the company and filing articles of incorporation in

1983. Further, Plaintiff maintains a website with the Studio Red

name. This is sufficient to establish that Plaintiff has used the

mark in commerce.

Next, Defendant asserts that Plaintiff has not established a

likelihood of confusion, arguing that the parties provide such

different services that confusion is highly unlikely because

Defendant's services "are focused on branding and product

showcasing while Plaintiff designs devices or industrial objects,

and provides prototyping and engineering services." Opposition at

7. Plaintiff counters that, like itself, Defendant "designs

products [and] graphical user interface and does brand work." 

Reply at 9. However, the "products" that Plaintiff alleges

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Defendant makes are not industrial prototypes similar to

Plaintiff's work. Rather, Defendant's products are created to

market already existing products. For example, Plaintiff notes

that Defendant has created a product called the Coca Cola Cruiser. 

This does not refute Defendant's argument that it is unlikely that

the sophisticated companies, such as Coca Cola, that hire the

parties would confuse Plaintiff's "prototyping services" with

Defendant's "post-production branding services." Opposition at 7.

Plaintiff further argues that it does not matter that the

parties' clients are sophisticated corporations because both

parties advertise on the internet and because the likelihood of

confusion must be considered for "the least sophisticated

consumer." Reply at 9 (quoting Ford Motor Co. v. Summit Motor

Prods., Inc., 930 F.2d 277, 293 (3d Cir. 1991). However, Plaintiff

provides no evidence that even the least sophisticated consumer in

this case is anything but a "corporation seeking to spend millions

for product development and design." Opposition at 7. 

Defendant also argues that Plaintiff's allegations that it has

received correspondence and telephone calls at its offices intended

for Defendant and that it has received inquiries regarding its New

York telephone number when it does not do business in New York are

not enough to establish actual confusion. Defendant notes that

Plaintiff makes only these general allegations and does not

indicate when it received the correspondence and inquiries, or the

frequency or nature of the communications. Defendant cites Duluth

News-Tribune v. Mesabi Publishing Co., 84 F.3d 1093 (8th Cir.) in

support of its argument. In Duluth News, the Eighth Circuit held

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that misdirected mail and phone calls failed to raise a factual

dispute regarding actual confusion because the evidence was

unreliable hearsay and because it found "the evidence to be de

minimis and to show inattentiveness on the part of the caller or

sender rather than actual confusion." Id. at 1098. 

Plaintiff provides no additional details about the misdirected

communications in its reply. Instead, Plaintiff notes that

California courts have accepted such evidence and argues that these

communications are enough to establish the likelihood of confusion. 

However, Plaintiff offers nothing to establish how these phone

calls, even if admissible, show confusion rather than

"inattentiveness."

Plaintiff also alleges that Defendant willfully chose to use

the Studio Red name, knowing that Plaintiff already used it. 

Plaintiff bases this allegation on the fact that Phillip Bourgeois,

the founder, president and CEO of Studio Red, had met and

interacted with Viemeister, the consultant hired by Rockwell Group

to create a "design lab" for Coca Cola. While Defendant

acknowledges Viemeister as the founder of Rockwell Studio Red, it

provides an affidavit from Viemeister stating that he was not

involved in choosing the Studio Red name, that the name was used

because of the affiliation with Coca Cola and that he did not

recall the existence of Studio Red when he was consulting with

Rockwell Group in 2003. Viemeister Declaration ¶¶ 3, 4.

Even if Plaintiff were able to demonstrate likelihood of

confusion, it has not demonstrated that it will suffer irreparable

harm. Although a showing of a likelihood of confusion raises a

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presumption of harm, Defendant has rebutted any such presumption by

demonstrating that the intended consumers of the parties' services

are not likely to be confused. 

Finally, the Court finds that the balance of hardships does

not tip sharply in Plaintiff's favor. Plaintiff has not

demonstrated or even suggested any harm that might come from

potential clients confusing the parties pending resolution of its

claims on the merits. In contrast, requiring Defendant to rename

its established business would likely be detrimental to it. 

Further, as Defendant notes, even assuming that Plaintiff did not

know about Rockwell Studio Red until August, 2006, when Bourgeois

emailed to ask it to stop using the name, Plaintiff waited eight

months to seek an injunction. Although this delay may not be

enough to bar injunctive relief, it does weigh against Plaintiff's

claim of hardship. 

The Court finds that Plaintiff has not demonstrated a

likelihood of confusion or that the balance of the hardships tips

sharply in its favor. 

CONCLUSION

For the foregoing reasons, the Court DENIES Plaintiff's motion

for a preliminary injunction (Docket No. 13).

IT IS SO ORDERED.

Dated: 5/18/07 

CLAUDIA WILKEN

United States District Judge

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