Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_05-cv-00920/USCOURTS-cand-4_05-cv-00920-2/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1125 Trademark Infringement (Lanham Act)

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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

MATRIX SEMICONDUCTOR,

Plaintiff,

 v.

LSI LOGIC CORPORATION,

Defendant.

 /

No. C 05-0920 SBA

ORDER

[Docket No. 29]

This matter is before the Court on Plaintiff Matrix Semiconductor's Motion for Preliminary

Injunction [Docket No. 29]. 

Having read and considered the arguments presented by the parties in the papers submitted to the

Court, the Court finds this matter appropriate for resolution without a hearing. The Court hereby DENIES

Plaintiff's Motion for Preliminary Injunction.

BACKGROUND

A. Factual Background

Plaintiff Matrix Semiconductor (“Matrix” or “Plaintiff”) is a Delaware corporation in the business of

producing goods and services relating to semiconductor memory and the storage of data, voice and video

content on semiconductormemory. Compl. ¶ 4. Matrix makes and sells memory chips and cards for a variety

of applications, including the storage of music, video and text content in consumer devices. Id. Matrix owns

the “MATRIX” and “MATRIX MEMORY” trademarks, which it uses in connection with the sale of its

semiconductor memory. Declaration of Liza K. Toth I.S.O. Motion for Preliminary Injunction (“Toth Decl.”)

at ¶ 5. The trademarks are federally registered. Toth Decl. at ¶ 5, Exs. A-C. Matrix has also been using the

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service mark MATRIX since July 1999. Declaration of Dan Steere I.S.O. Motion for Preliminary Injunction

("Steere Decl.") at ¶ 2. 

Matrix produces a low-cost, high- density secure, one-time-programmable (OTP), non-volatile

memory. Declaration of Khari J. Tillery I.S.O. Opp. to Motion for Preliminary Injunction ("Tillery Decl.") at

Ex. D. Matrix sells its OTP products as "stand alone memory." Tillery Decl. at Ex. C, ¶ 9. 

Defendant LSI Logic Corporation (“LSI” or “Defendant”) is a Delaware corporation whose business

focuses on the design and production ofhigh-performance semiconductorsforconsumer, communications, and

storage applications that access, interconnect, and store data, voice, and video. Compl. ¶ 5. LSI sells

integrated circuits(or "semiconductor chips") to various manufacturers of computer products. Tillery Decl. at

Ex. C, ¶ 3. Much of what LSI sells are chips known as ApplicationSpecific Integrated Circuits, or “ASICs.”

Id. The chips are tailored to specific customers needs, and therefore the engineering and testing costs can

sometimes approach $1 million. Id. at ¶4. As a result, ASICs are typically purchased in large volume after

careful investigation by engineers working for a particular customer. Id. at ¶4. The process can take a year

or more. Id. at ¶ 4. LSI also has developed a method of streamlining the ASIC-development process which

it calls the “RapidChip methodology." Id. at ¶5. This methodology allows LSI to customize a chip for

significantly less than $1 million, but can still cost a customer between $100,000 and $300,000 in one-time

engineering expenses. Id. Even using the RapidChip methodology, the process can take four to six months

and the customer still relies upon its own engineers to help it make decisions about designing and purchasing

the chip. Id. 

LSI has created the “RapidChip Integrator2,"which is a family ofRapidChip platforms targeted to the

computer-network market. Id. at ¶6. Among other things, the RapidChip Integrator2 contains memory, such

as Random Access Memory (“RAM”), which allows data to be stored and retrieved. Id. The RapidChip

Integrator2 also includes "logic gates"whichperformspecific functions. Declaration of Richard Brossart I.S.O.

Opp. to Motion for Preliminary Injunction ("Brossart Decl.") at ¶ 3. The RapidChip Integrator2 platform is

optimized for specific functions such as networking. Tillery Decl. at Ex. C, ¶ 10. It would typically be used

by a customer making specific products like network routers, network switches, network adapter cards,

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servers, and related products. Id. Potential RapidChip Integrator2 platform customers include Cisco, Sun

Microsystems, and Nortel. Id.

LSI uses the termMatrixRAM to describe the RAM component ofitsRapidChip Integrator2 platform.

Id. at ¶ 7. RAM (or "random access memory") is a form of data storage in which any piece of information can

be independently stored or retrieved. RAM holds its contents temporarily, maintaining data only while the

electricalpower remains on. RAM consists of memory cells for storing and retrieving information very quickly,

and changing its contents very quickly. RAM is essential for complex, high-speed computing and signal

processing. Brossart Decl. at ¶ 6. LSI adopted the name MatrixRAM for this component because RAM cells

form a two-dimensional "matrix" of rows and columns. Tillery Decl. at Ex. C, ¶ 8. On LSI's website, the

company refers to the MatrixRam product as either "Matrix," "Matrix RAM" or "Matrix-RAM." Toth Decl.

at Exs. D-F. On February 23, 2005, LSI filed its own trademark application for "MatrixRAM" pursuant to

15 U.S.C. § 1051(b). Toth Decl. ¶¶ 19-20, Ex. 20. 

Both LSIand Matrix selltheir productsto originalequipment manufacturers,such as Sony or Nintendo,

for end use in the consumer electronics fields. Declaration of Dennis Segers I.S.O. Motion for Preliminary

Injunction("Segers Decl.") at ¶¶ 11, 14. Matrix contends that its product line will eventually expand from onetime programmable memory products into other varieties of memory and circuits because its founders never

intended to be limited to one-time programmable memory (OTP) or read-only memory (ROM). Declaration

of Thomas H. Lee I.S.O. Motion for Preliminary Injunction at ¶¶ 4-5. Matrix, as a company, has won

recognition and awards for its products and technology throughout the past few years and has spent over $12

Million in sales and marking efforts since the first quarter of 2001. Steere Decl. ¶¶ 3 and 16, Exs. A-E. 

B. Procedural History

On March 3, 2005, Matrix filed a Complaint against LSI alleging the following causes of action: (1)

trademark infringement under 15 U.S.C. § 1114; (2) false claims advertising and unfair competition under 15

U.S.C. § 1125(a); (3) dilution of trademarks under 15 U.S.C. § 1125(c); and (4) equitable accounting. 

On March 4, 2005, Matrix filed an application for a temporary restraining order ("TRO") under itsfirst

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three causes of action. This Court denied Matrix's application for a TRO on March 11, 2005.

On April 12, 2005, Matrix filed the instant Motion for Preliminary Injunction. In its Motion for

Preliminary Injunction, Matrix seeks to prohibit LSI from using the registered trademarks MATRIX and

MATRIX MEMORY, or the service mark MATRIX, or any other mark of Plaintiff, or any word, symbol,

phrase or termsimilarthereto, including"MATRIX,""MATRIXRAM," "MATRIX-RAM," and "MatrixRAM"

alone or displayed on products or in promotionalmaterial, advertisements, the internet, business cards, labels,

signs, or in any other way, in connectionwith the advertising, distribution, offering forsale orsale of any product

or service not emanating from and authorized by Plaintiff. However, Matrix does notseek to enjoin LSI from

its continued use of the word "matrix" to describe rows and columns of components in its integrated circuits.

LEGAL STANDARD

FederalRule ofCivil Procedure 65(b) and the LanhamAct, 15 U.S.C. § 1116(a), provide that a court

has the "power to grant injunctions, according to the principles of equity and upon such terms as the court may

deem reasonable, to prevent the violation of any right of the registrant of a mark registered in the Patent and

Trademark Office or to prevent a violation under section 1125(a) of this title." 15 U.S.C. § 1116(a). A party

seeking a preliminary injunction must show either (1) a combination of probable success on the merits and the

possibility ofirreparable injury ifreliefis not granted or (2) the existence ofserious questions going to the merits

and that the balance ofhardships tipssharply in itsfavor. Ocean Garden, Inc. v. Marktrade Company, Inc.,

953 F.2d 500, 506 (9th Cir.1991)(quoting First Brands Corp. v. Fred Meyer, Inc., 809 F.2d 1378, 1381

(9th Cir.1987)); see also Sardi's Restaurant Corp. v. Sardie, 755 F.2d 719, 723 (9th Cir.1985). Both tests

require the movingparty to prove a significant threat ofirreparable injury. Hollywood Athletic Club Licensing

Corp. v. GHAC-CityWalk, 938 F.Supp. 612, 614 (C.D. Cal. 1996).

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DISCUSSION

A. Likelihood of Success on the Merits and Possibility of Irreparable Harm

In order to prevail on either ofitsfirst two causes of action, Matrix mustshow a likelihood of confusion

as to the source ofLSI’s “Matrix RAM.” See Dr.Seuss Enterprises, L.P. v. Penguin BooksUSA, Inc., 109

F.3d 1394, 1403-04 (9th Cir. 1997). In trademark infringement actions, "once the plaintiff establishes a

likelihood of confusion, it is ordinarily presumed that the plaintiff will suffer irreparable harm if injunctive relief

is not granted.” Vision Sports, Inc. v. Melville Corp., 888 F.2d 609, 612 n.3 (9th Cir. 1989). 

The Ninth Circuit utilizes an eight-factor test (known as the Sleekcraft test) to determine likelihood of

confusion in trademark infringement cases. The eight factors are as follows: (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) type of goods and the degree of care likely to be exercised by the purchaser; (7) defendant's intent

in selecting the mark; and (8) likelihood of expansion of the product lines. Dr. Seuss Enterprises, 109 F.3d

at 1404 (citing AMF, Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-49 (9th Cir. 1979)). While each of these

factors are to be considered in reaching a decision on the issue of likelihood of confusion, “‘no mechanistic

formula or list can set forth in advance’ the variety of elements that comprise the market context from which

likelihood of confusionmust be determined.” Dr. Seuss Enterprises, 109 F.3d at 1404 (quoting Restatement

(Third) of Unfair Competition § 21, comment a (1995)).

1. Strength of the Marks

In the Order denying Plaintiff's TRO application, the Court found that Plaintiff's marks were notstrong,

but rather were descriptive of the layout of most computer memories. Plaintiff now argues that its marks are

sufficiently strong under Sleekcraft because they are suggestive, rather than descriptive, marks. Plaintiff also

argues that the strength of its marks is demonstrated by the fact that the marks were accepted for the Principal

Register by the United States Patent and Trademark Office (“PTO”). 

“A strong mark is inherently distinctive, for example, an arbitrary or fanciful mark; it will be afforded

the widest ambit of protection from infringing uses.” Sleekcraft, 599 F.2d at 349 (citing National Lead Co.

v. Wolfe, 223 F.2d 195, 199 (9th Cir. 1955)). On the other hand, “[a] descriptive mark tells something about

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It should also be noted that Plaintiff's insistence that trademark registration is relevant to the analysis

ofthis Sleekcraft factor appears to result from Plaintiff's misreading ofBrookfield Communications, Inc. v.

West Coast Entertainment Corp., 174 F.3d 1036 (9th Cir. 1999). In Brookfield, there was a question as

to whether the plaintiff was, in fact, the senior user of the trademark. Id. at 1046-47 ("To resolve whether [the

defendant's] use of 'moviebuff.com' constitutes trademark infringement or unfair competition, we must first

determine whether [the plaintiff] has a valid, protectable trademark . . . .") Thus, the Brookfield court first

needed to establish whether the plaintiff had a protectable trademark before embarking on the Sleekcraft

analysis. See, e.g., id. at 1053 ("Establishing seniority, however, is only half the battle.") That is not the case

here. Similarly, the fact that LSI registered the term "MatrixRAM" with the PTO after Matrix had registered

its marks only goes to the priority rights of the user, and is not determinative of the strength of the mark.

2Section 1052 provides that “No trademark . . . shall be refused . . . unless it . . . consists of a mark

which (1) when used on or in connection with the goods of the applicant is merely descriptive or deceptively

descriptive of them . . . .” 15 U.S.C. § 1052. 

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the product; it will be protected only when secondary meaning is shown.” Id. (citations omitted). “In between

lie suggestive marks which subtly connote something about the products. Although less distinctive than an

arbitrary or fanciful mark and therefore a comparatively weak mark, a suggestive mark will be protected

without proof of secondary meaning.” Id. (citation omitted). 

As a preliminary matter, the parties dispute the significance ofthe fact that Plaintiff’smarks are federally

registered trademarks.1 Plaintiff relies on 15 U.S.C § 10522 to argue that the PTO’s willingness to accept the

marks for the Principal Register conclusively demonstrates that they are, at the very least, suggestive marks.

LSI counters this by asserting that federal registration merely creates a presumption of validity, which

presumption is soundly rebutted in the instant matter. See San Juan Products, Inc. V. San Juan Pools, Inc.,

849 F.2d 468, 474 (10th Cir. 1988). With respect to this issue, the Court agrees with LSI; the fact that Matrix

has registered its trademark with the PTO creates a rebuttable presumption of validity, but it does not end the

inquiry altogether.

In order to determine the strength of the mark, the Court must examine whether the marks truly rise

to the level of suggestiveness or whether they are merely descriptive. Here, LSI has advanced a compelling

argument that the marks "MATRIX" and "MATRIX MEMORY" are descriptive. A mark is descriptive if it

consists of “words descriptive of the . . . characteristics ofan article oftrade.” See Estate of P.D. Beckwith,

Inc. V. Commissioner of Patents, 252 U.S. 538, 543 (1920). The words need not “describe all of the

properties or functions of the goods . . . [but] it is sufficient if the term describes a significant attribute or idea

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about them.” In re Intelligent Instrumentation, Inc., 40 U.S.P.Q.2d 1792-93 (1996). In determining

whether words are descriptive of a particular product, the Court must consider the sophistication and

knowledge of the prospective buyers. Id. at 1793. 

LSI argues that Plaintiff's marks are descriptive because the term “matrix” is commonly used in the

industry to describe the structure of digital memory. In fact, the Microsoft Computer Dictionary defines a

matrix as “an array of circuit elements . . . for performing a specific function.” Tillery Decl. at Ex. A. Other

technical dictionaries define a matrix as a “memory array used in . . . computers.” Tillery Decl. at Ex. B.

Additionally, the term“matrix”is oftenused as a termof art in patents when describing computer memory. See,

e.g., id. at Ex. F-J. Given this evidence, Matrix’s bare assertion that its marks are suggestive is unpersuasive.

A suggestive mark is one that “subtly connote[s] something about [its] products." Sleekcraft, 599

F.2d at 349 (emphasis added). "A suggestive mark conveys an impression of a good but requires the exercise

of some imagination and perception to reach a conclusion as to the product's nature." Brookfield

Communications, Inc., 174 F.3d at 1058 n.19 (emphasis added). Here, Matrix has made no showing that

one's imaginationis required to understand that the termmatrix is referring to an arrangement ofmemory, since

"matrix," by definition, is an array of circuit elements or memory used in computers. This is even more true in

the case of the term "MATRIX MEMORY," which Plaintiff does not effectively deny is descriptive of its

product. 

Further, Plaintiff's reliance on Brookfield is misplaced. Contrary to Plaintiff's assertion, Brookfield

does not establish thatthe Matrix's advertising effortsstrengthen its marks. In Brookfield, the court concluded

that the mark was suggestive before considering the plaintiff's evidence concerning its advertising expenditures.

See id. at 1058 ("Importantly, [plaintiff's] trademark is not descriptive because it does not describe either the

software product or its purpose.") (emphasis added). Moreover, despite the plaintiff's evidence, the court in

Brookfield eventually concluded that the mark was weak. Id. Further, in Sleekcraft, the Ninth Circuit

rejected the contention that extensive advertising automatically transforms a suggestive mark into a strong one.

See Nutri/System, Inc. v.Con-Stan Industries, Inc., 809 F.2d 601, 605 (9th Cir. 1987) (citing Sleekcraft,

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599 F.2d at 350). Since the Court concludes, here, that Plaintiff's marks are descriptive, they are at the

weakest end of the spectrum and Plaintiff's marketing efforts are therefore insufficient to bolster the strength

of its marks. 

Additionally, even if it is undisputed that Plaintiff produces a unique and award winning product, this

is not the equivalent of establishing that it has highly recognized trademarks. The relevant criterion is whether

the mark is actually viewed by the public as an indicationof the product's origin. Sleekcraft, 599 F.2d at 349.

Plaintiff's evidence does not establish this. For example, in one article, attached to the Steere Declaration as

Exhibit A, the sole mention of Plaintiff is as follows "Winners of this year's [Innovation Awards] contest are:

Susanne Paul, Silicon Laboratories, Atheros Communications; AMCC; Matrix Semiconductor; National

Semiconductor; NationalInstruments; VirtualSiliconTechnology; Knowles Acoustics; Enpirion; Power-One;

Intel; Texas Instruments; Tektronix; Eric Bogatin, PhD, Synergetix; and Gene Garat,MentorGraphics." Steere

Decl. at Ex. A. This evidence does not conclusively establish that Plaintiff's marks are widely recognized.

Accordingly, the Courtfindsthat Plaintiff's marks are merely descriptive, and thus this Sleekcraft factor weighs

heavily in favor of LSI. 

2. Proximity of the Goods

The second Sleekcraft factor concerns the proximity of the goods. “For related goods, the

danger presented is that the public will mistakenly assume there is an association between the producers

of the related goods, though no such association exists.” Sleekcraft, 599 F.2d at 350. 

In support of its TRO application, Plaintiff argued that this factor was met because Matrix’s and

LSI’s products are both electronic memories destined for use in consumer goods for text, voice, and

video. LSI, on the other hand, asserted that Matrix's characterization of the goods was oversimplified,

and that the types of memory are, in fact, very different. Specifically, LSI argued that the products are

substantially different because LSI’s product is for RAM, while Matrix’s product is for OTP memory.

In denying the TRO, the Court was persuaded by LSI's argument, and found that, while both the Matrix

and LSI products involve memory, the two products differ significantly in function and therefore are not

sufficiently related. 

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With respect to the instant motion, Plaintiff has not produced any new evidence that compels a

different conclusion. LSI, on the other hand, has demonstrated that there is a "world of difference

between the semiconductor chips produced by LSI and those produced by Matrix." Specifically, LSI

points out that its RapidChip methodology is highly customized and costs customers between $100,000

to $300,000, whereas Matrix produces a "low-cost-per-bit write-once"memory productfor use in highvolume consumer electronics and applications requiring inexpensive media. As even Martix admits, the

focus here is on "whether the consuming public is likely somehow to associate [the plaintiff's]products with

[the defendant's]." See Brookfield, 174 F.3d at 1056. Given the fundamental differences between the

products, and given the sophisticated nature of this market, the Court concludes that this factor weighs

only slightly in favor of Matrix. 3. Similarity of the Marks

The third Sleekcraft factor concerns the similarity of the marks. “Similarity of the marks is tested

on three levels: sight, sound, and meaning.” Sleekcraft, 599 F.2d at 351. “Although similarity is

measured by the marks as entities, similarities weigh more heavily than differences.” Id. With regard to

the instant Motion, neither party appears to dispute that the marks are clearly similar in sight, sound, and

meaning. Accordingly, this factor weighs in favor of Matrix. 

4. Evidence of Actual Confusion

The fourth Sleekcraft factor concerns a finding of actualconfusion in the marketplace. “Evidence

that use ofthe two marks has already led to confusion is persuasive proof that future confusion is likely.”

Sleekcraft, 599 F.2d at 352. Here, although Plaintiff vigorously contends that confusion is likely, it

nevertheless concedes that there still is no evidence of actual confusion. Accordingly, this factor heavily

favors LSI. 

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5. Marketing Channels

The fifth factor concerns the likelihood of confusion arising out of convergent marketing channels.

“Convergent marketing channels increase the likelihood of confusion.” Sleekcraft, 599 F.2d at 353. 

In support of its TRO application, Matrix argued that the two companies use the same marketing

channels and sell to the same customers. LSI, however, argued that the two products were in very

different marketing channels. Specifically, LSI argued that the RapidChip Integrator2 from LSI, which

is the product that contains MatrixRAM, costs up to $300,000 and caters toward computer networking

clients that make products like network routers, network switches, network adapter cards and servers.

In contrast, Matrix 3-D Memory is marketed as a secure, low-cost medium for distributing prerecorded

video, music, games and software applications and as a potential rival to flash memory cards in digital

cameras, MP3 players, and cellular phones. 

In denying the TRO, the Court was persuaded by LSI's argument and found that this factor did

not weigh in favor ofMatrix. With respect to the instant Motion, Plaintiff now argues that this Sleekcraft

factor has been satisfied by the fact that Matrix and LSI share common magazine and press sources.

Specifically, Matrix asserts that both Matrix and LSI are mentioned in articles published by FSA and in

Electronic Business Online reports and Consumer Electronics Show brochures. See Seger Decl. at Exs.

D-G. The articles, however, appear to be standard industry publications thatreport on the activities and

financial statements of numerous companies in the semiconductorindustry. See, e.g., Seger Decl. at Ex.

D ("LSI Logic Corp. has raised revenue guidance for its first quarter of 2005 . . .") and ("Matrix

Semiconductor Inc., a developer of three-dimensional semiconductor memory, has joined a partner

programbelonging to Symbian plc, a vendor ofoperating systems for mobile phones"). In the one article

where LSI and Matrix are mentioned in conjunction, the discussion relates to LSI's capacity as a "fab,"

and does not mention LSI's memory products. See Seger Decl. atEx. E. Therefore, Plaintiff's evidence

does not shed any clarity on the instant matter, which is whether LSI and Matrix's marketing channels

converge to such an extent that confusion in the marketplace is likely. If anything, the articles establish that

marketplace confusion is unlikely due to the fact that the relevant industry media coverage is so thorough

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and comprehensive. Accordingly, Matrix still has not demonstrated that this factor weighs in its favor. 

6. Type of Goods and Degree of Purchaser Care

The sixth factor concerns the type of goods at issue and the degree of care a purchaser would

likely use when selecting the product. “When the buyer has expertise in the field, a higher standard is

proper though it will not preclude a finding that confusion is likely.” Sleekcraft, 599 F.2d at 353.

“Similarly, when the goods are expensive, the buyer can be expected to exercise greater care in his

purchases; again, though, confusion [] may still be likely.” Id.

In denying the TRO application, the Court was persuaded by LSI's argument that the high price

ofthe goods, and the sophisticated nature of the customers, weighed heavily in favor of a conclusion that

confusion was notlikely. Plaintiff now argues that its customers will likely be confused by LSI's use of the

term "matrix" and assume that Matrix has licensed its technology to LSI. Plaintiff has also submitted

declarations fromitsfounder and two of its executives, which purportedly demonstrate that the likelihood

of confusion is heightened due to the fact that Matrix's technology is more complex than LSI suggests.

The fact that Matrix's executivessubjectively believe that confusion is likely, however, is not evidence that

such confusion will, or probably will, occur. Moreover, it does not refute LSI's argument, which is

premised on the notion that LSI's customers are large and sophisticated buyers who typically exercise a

high degree of diligence in the evaluation and purchase ofproducts. Accordingly, the Court finds that this

factor weighs in favor of LSI. 

7. Intent 

The seventh Sleekcraft factor concerns LSI's intent. “When the alleged infringer knowingly

adopts a mark similar to another's, reviewing courts presume that the defendant can accomplish his

purpose: that is, that the public will be deceived.” Sleekcraft, 599 F.2d at 354. 

In denying Plaintiff's TRO application, this Court was not persuaded by Plaintiff's argument that

LSI intentionally adopted Matrix's marks in order to capitalize on Matrix's goodwill. Indeed, Plaintiff

offered little more than pure speculation that Defendant acted with such intent, which was effectively

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refuted byLSI's express statement that the reason it chose to use the term “MatrixRAM” to describe its

product had nothing to do with Plaintiff's marks. With respect to the instant Motion, Plaintiff has not

provided the Court with any new evidence or argument in support of its theory that Defendant is

attempting to capitalize on its goodwill. In contrast, LSI has affirmatively stated, again, that the team

involved in selecting the name MatrixRAM was completely unrelated to the team that formerly worked

with Matrix. See Tillery Decl., Ex. C at ¶ 8. Accordingly, the Court finds that this factor favors LSI. 

8. Likelihood of Expansion

The lastSleekcraftfactoris the likelihood of expansion. The Court previously found unpersuasive

Matrix's argument that it would be likely to expand its business into an area that directly competes with

LSI. “Inasmuch as a trademark owner is afforded greater protection against competing goods, a ‘strong

possibility’ that either party may [] expand his business to compete with the other will weigh in favor of

finding that the present use is infringing.” Sleekcraft, 599 F.2d at 354. With respect to the instant

Motion, Plaintiff repeats many of the same arguments thatthe Court has already rejected. For example,

Plaintiff contends that its founders never intended the company to be limited to one-time programmable

or read-only memory. See, e.g., Lee Decl. at ¶¶ 3-5. However, Plaintiff also cites to certain recently filed

patent applications relating to RAM technology, which at least suggest that Plaintiff may seriously be

considering expanding its business into an area that would directly compete with LSI. See Toth Decl. ¶¶

16-18; Declaration of Liza Toth I.S.O. Reply ("Reply Toth Decl") at Exs. Q-T. 

Given Plaintiff's new evidence, Plaintiff has made a minimal showing that it may, at some point,

expand its business into RAM technology, and therefore may directly compete with LSI. The Court

therefore finds that this factor somewhat weighs in favor of Matrix.

9. Evaluation of the Sleekcraft Factors

Based on the eight Sleekcraft factors, Plaintiff has failed to establish a likelihood of success on

the merits. At most, only three of the eight factors weigh in favor of Plaintiff, while the other five factors

favor Defendant. Therefore, the Court finds that, at this point, there is not a likelihood of confusion

between Matrix’s and LSI’s marks. 

Case 4:05-cv-00920-SBA Document 54 Filed 06/10/05 Page 12 of 14
United States District Court

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B. Balance of Hardships

A preliminary injunctionis appropriate only if there are serious questions going to the merits and

the balance ofhardships tipssharply in favor ofthe moving party. Ocean Garden, Inc., 953 F.2d at 506.

In the instant case, even assuming that serious questions exist going to the merits, the balance ofhardship

does not tip sharply in Matrix’s favor. 

For example, Matrix argues that it would face the following hardships ifthe preliminary injunction

is not granted: (1) sophisticated high-tech companies would believe that there is no real trademark

protection available; (2) LSI would be allowed to use Matrix's company name; (3) the $12.7 million

Matrix has spent in marking its products would be lost; and (4) Matrix's goodwill could be tarnished.

Thus, the essence of Matrix's argument is that its goodwill might be jeopardized if consumers think that

“MatrixRAM” is made by Matrix or if consumers think that Matrix has licensed its technology to LSI.

However, this argument depends entirely upon the assumption thatthere is a likelihood of confusion in the

first place. Since Matrix has not demonstrated thatsuchmarketplace confusion is likely, Matrix's hardship

argument fails.

LSI, on the other hand, arguesthat,ifa preliminary injunctionissues, its promotionaleffortsrelating

to the RapidChip Integrator2 will be lost and LSI'sreputationwill be tarnished in the eyes ofits customers.

LSI also points out that it announced its RapidChip Xtreme2 family of platform ASICs in March 2005

and publicly touted its RapidChip Integrator2 platform at a worldwide sales conference in April 2005.

Thus, LSI would face serious ramifications if it were required to immediately cease using the term

"MatrixRAM." 

//

//

Case 4:05-cv-00920-SBA Document 54 Filed 06/10/05 Page 13 of 14
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SinceMatrix has not demonstrated that the balance ofhardships tipssharply in itsfavor, thisCourt

hereby DENIES Plaintiff's Motion for Preliminary Injunction.

CONCLUSION

IT IS HEREBY ORDERED THAT Plaintiff’s Motion for Preliminary Injunction[DocketNo. 29]

is DENIED.

IT IS SO ORDERED.

 /s/ Saundra Brown Armstrong 

Dated: 6-10-05 SAUNDRA BROWN ARMSTRONG

United States District Judge

Case 4:05-cv-00920-SBA Document 54 Filed 06/10/05 Page 14 of 14