Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_05-cv-00999/USCOURTS-caed-1_05-cv-00999-0/pdf.json

Parties Involved:
Resource Lenders, Inc.
Counter Defendant
Source Solutions, Inc.
Counter Claimant

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

RESOURCE LENDERS, INC., a

California corporation

Plaintiff,

v.

SOURCE SOLUTIONS, INC., a Nevada

corporation,

Defendant.

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1:05-cv-0999 OWW LJO

MEMORANDUM DECISION AND

ORDER RE PLAINTIFF’S MOTION

FOR A PRELIMINARY

INJUNCTION (Doc. 5)

I. INTRODUCTION

Plaintiff RESOURCE LENDERS, INC. (“Plaintiff” or “RESOURCE

LENDERS”) moves for a preliminary injunction against Defendant

SOURCE SOLUTIONS, INC. (“Defendant” or “SSI”), enjoining SSI from

using the designations “RESource” or “R.E.Source” or

“R.E.*Source” (where the * is a house or other logo), or the

introductory word “resource” or any representation of the word

“resource” as the introductory word in its business name or

service mark, in any manner in connection with the distribution,

advertisement, promotion, offer for sale and/or sale of any real

estate or mortgage services. SSI opposes the motion.

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II. PROCEDURAL HISTORY

This trademark infringement, unfair trade practices, and

dilution action arises out of the complaint of Plaintiff, a real

estate mortgage loan provider, that defendant SSI has infringed

on Plaintiff’s service marks, which are (1) “Resource Lenders”

and (2) “Resource Lenders Your Resource For Real Estate Loans.” 

SSI, a real estate sales and mortgage loan company, currently

uses the mark “R.E.*Source Redefining Real Estate,” (where the *

is a logo of a house) and argues that its mark does not infringe

on or dilute Plaintiff’s mark. Plaintiff argues that SSI’s use

of the terms “RESource”, “R.E.Source”, and/or “R.E.*Source” as

the introductory word in its mark does infringe and should be

enjoined.

Plaintiff filed its complaint on August 3, 2005. (Doc. 1,

Compl.) Plaintiff brings six claims against Defendant: 

(1) Infringement of Federally Registered Service Mark (15 U.S.C.

§ 1114(1)); (2) Infringement of Service Mark; (3) Trade Name

Infringement (Cal. Bus. & Prof. Code § 14330); (4) Unfair

Competition and False Designation of Origin (15 U.S.C.

§ 1125(a)); (5) Unfair Competition and Unfair Business Practices

(Cal. Bus. & Prof. Code § 17000, et seq., and § 17200); and

(6) Dilution (15 U.S.C. § 1125(c); Cal. Bus. & Prof. Code

§ 14330). Defendant answered the Complaint on September 6, 2005. 

(Doc. 18, Answer)

On August 10, 2005, Plaintiff filed a motion for preliminary

injunction (Doc. 5, Pl.’s Mot.) and three supporting declarations

(Docs. 7, 8, 10). On September 2, 2005, defendant filed

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opposition. (Doc. 17, Def.’s Opp.) On September 12, 2005,

Plaintiff filed a reply (Doc. 20, Pl.’s Reply) and three

supplemental declarations (Docs. 21-23). Oral argument was heard

on September 19, 2005. Mark D. Miller, Esq., appeared on behalf

of Plaintiff. Sharon Jane Adams, Esq., appeared on behalf of

Defendant. Additional briefing was scheduled to allow Defendant

to object to supplemental evidence submitted by Plaintiff and to

allow Plaintiff to submit additional evidence of actual

confusion. On September 27, 2005, defendant filed a brief in

compliance with the briefing schedule titled “Memorandum of

Points and Authorities in Support of Defendant’s Response to New

Evidence Submitted with Plaintiff’s Reply.” (Doc. 30, Def.’s

Sur-Reply) On September 30, 2005, Plaintiff responded, filing a

brief titled “Plaintiff’s Supplemental Reply Memorandum of Points

and Authorities in Support of Motion for Preliminary Injunction.” 

(Doc. 33, Pl.’s Sur-Reply) Plaintiff also filed twelve

supplemental declarations. (Docs. 34-45) Defendant replied on

October 7, 2005. (Doc. 47, Def.’s Mem. in Opp.)

II. BACKGROUND

Plaintiff RESOURCE LENDERS is a real estate mortgage and

loan services provider headquartered in Fresno, California, with

offices in Bakersfield, Visalia, Porterville, Hanford, and San

Luis Obispo. RESOURCE LENDERS alleges it has engaged in

extensive advertising and promotion of its real estate mortgage

and loan services under the name “Resource Lenders” for the past

fifteen (15) years including radio and newspaper advertising,

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circulating flyers and brochures, and advertising signs,

including those posted on the scoreboard at Grizzlies Stadium in

Fresno, California. The parties do not dispute that RESOURCE

LENDERS owns two marks: (1) “Resource Lenders” and (2) “Resource

Lenders Your Source for Real Estate Loans.” Defendant SSI opened

in 2004. SSI represents buyers and sellers in real estate

transactions and also provides real estate loans. (Wren Decl. ¶¶

2, 3) SSI asserts that the majority of its business is real

estate transactions and not making loans. (Id. at ¶ 4) The mark

currently in use by SSI is “R.E.*Source Redefining Real Estate”

(where the * is a logo of a house). SSI has also used the mark

“RESource Real Estate Mortgage,” although SSI asserts it no

longer uses this mark.

In or about January 2005, RESOURCE LENDERS discovered that

Defendant SSI had adopted the business name and designation

“RESource Real Estate Mortgage” and that SSI was using these

names to promote real estate mortgage and loan services in the

Fresno area. (Barnes Decl. ¶ 8)

RESOURCE LENDERS sent a first demand letter to SSI on

January 28, 2005 to which SSI failed to respond. (Miller Decl.

¶ 2, Ex. A) RESOURCE LENDERS made a follow-up telephone call in

March 2005, with no response. RESOURCE LENDERS sent a second

letter with a draft unfiled complaint to SSI on March 22, 2005. 

SSI responded to this letter, and several weeks of discussions

and negotiations between the parties regarding SSI’s business

name followed. The discussions did not result in any agreement

or resolution. (Barnes Decl. ¶ 8) 

In its opposition, Defendant asserts that settlement

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discussions broke down because Plaintiff refused to include a

“notice and cure” provision in the proposed settlement agreement. 

Defendant asserts that it began using the designation

“R.E.*Source Redefining Real Estate” in response to Plaintiff’s

complaints and “with the approval of Plaintiff’s counsel.” (Doc.

17, Def.’s Opp. 2-3; Adams Decl. Ex. A) Defendant denies

continuing to use the mark “RESource Real Estate Mortgage,” and

asserts that current appearances of this mark are merely

infrequent and mistaken uses that have not yet been addressed in

its transitioning process. (Doc. 17, Def.’s Opp. 2-3) Defendant

argues it has taken steps to implement its name change, including

ordering new business cards, signs, and filing a new fictitious

business statement with the City of Fresno. (Id.; Doc. 17,

T. Wren Decl., ¶ 5, Ex. A) However, Plaintiff notes that the

mark “RESource Real Estate Mortgage” has appeared in the October

2005 issue of Guide to Better Homes. (Doc. 34, 09/30/05 Miller

Decl. Ex. A) This advertisement lists two real estate agents at

the top of the page and lists seven mortgage consultants and/or

mortgage consultant/real estate agents at the bottom of the page. 

An almost identical advertisement appeared in the September 2005

issue of the Guide, which Plaintiff attached to its initial

moving papers. (Doc. 23, 09/12/05 Miller Decl. Ex. F) Defendant

states that it wants all of its agents to use its new mark, and

attributes the appearance of this advertisement in the October

2005 issue to “confusion among Defendant’s over 250 employees and

contractors.”

Despite defendant’s changing its name to “RESource

Redefining Real Estate”, however, RESOURCE LENDERS argues that

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defendant’s use of the mark “RESource” is nevertheless an

infringing use because the term “RESource” is prominently

displayed on the new mark, just as it was on the old mark.

RESOURCE LENDERS alleges that SSI uses the infringing marks

in the following ways: (1) portable street signs (MacArthur

Decl., Ex. H); (2) SSI maintains fictitious business name

statements for “RESOURCE” and “RE-SOURCE” (Miller Decl. ¶ 8, Ex.

E); (3) SSI has a mortgage broker’s license listing its DBA’s as

“RESOURCE” and “RE-SOURCE” (Id. at ¶ 9, Ex. F); (4) SSI displays

the mark on websites, including http://www.resourcerecruit.com;

http://www.resourcecorporate.com; and

http://www.resourceontheweb.com (Id. at Exs. H, I).

III. LEGAL STANDARD

Certain prerequisites must be satisfied prior to issuance of

a preliminary injunction. Under the so-called “traditional”

standard, an injunction may issue if the court determines that

(1) the moving party will suffer irreparable injury if the relief

is denied; (2) there is a strong likelihood that the moving party

will prevail on the merits at trial; (3) the balance of potential

harm favors the moving party; and (4) the public interest favors

granting relief. Under the “alternative” standard, an injunction

properly issues when a party demonstrates either: (1) a

combination of probable success on the merits and the possibility

of irreparable injury if relief is not granted; or (2) the

existence of serious questions going to the merits combined with

a balancing of hardships tipping sharply in favor of the moving

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party. The requirement for showing a likelihood of irreparable

harm increases or decreases in inverse correlation to the

probability of success on the merits, with these factors

representing two points on a sliding scale. Earth Island

Institute v. United States Forest Service, 351 F.3d 1291, 1310

(9 Cir. 2003). th

The bases for injunctive relief (preliminary or permanent)

in the federal courts have always been irreparable injury and the

inadequacy of legal remedies. Weinberger v. Romero-Barcelo, 456

U.S. 305, 312 (1982); High Sierra Hikers Ass’n v. Blackwell, 390

F.3d 630, 641-42 (9 Cir. 2004); Ford v. Reynolds, 316 F.3d 351, th

355 (2 Cir. 2003). Under either the traditional or the nd

reformed approach, to obtain a preliminary injunction, the

Plaintiff must show that it is "likely" to prevail on the merits. 

Southern Oregon Barter Fair v. Jackson County, Oregon, 372 F.3d

1128, 1136 (9 Cir. 2004). As part of its balancing of factors, th

the court weighs the competing claims of injury and considers the

effect on each party of the granting or withholding of the

requested relief. Amoco Prod. Co. v. Village of Gambell, Alaska,

480 U.S. 531 (1987); Clear Channel Outdoor, Inc. v. City of Los

Angeles, 340 F.3d 810, 813 (9 Cir. 2003). th

In determining whether a preliminary injunction is

warranted, the Court may consider otherwise inadmissible

evidence, such as hearsay. See Flynt Distrib. Co., Inc. v.

Harvey, 734 F.2d 1389, 1394 (9th Cir. 1984) (“The urgency of

obtaining a preliminary injunction necessitates a prompt

determination and makes it difficult to obtain affidavits from

persons who would be competent to testify at trial. The trial

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court may give even inadmissible evidence some weight, when to do

so serves the purpose of preventing irreparable harm before

trial.”); Republic of the Philippines v. Marcos, 862 F.2d 1355,

1364 (9th Cir. 1988); Rosen Entm’t Sys., LP v. Eiger Vision, 343

F. Supp. 2d 908, 912 (C.D. Cal. 2004); Glow Indus., Inc. v.

Lopez, 252 F. Supp. 2d 962, 966 n. 1 (C.D. Cal. 2002).

III. ANALYSIS

A. Likelihood of Success on the Merits.

1. Counts I & II: Infringement of Federally

Registered Service Mark (15 U.S.C. § 1114(1)) and

Common Law Infringement of Service Mark.

Plaintiff’s first and second claims for relief are service

mark infringement in violation of Title 15, Section 1114(1), of

the United States Code, and of common law service mark

infringement. Plaintiff has a federally-registered service mark,

“Resource Lenders Your Source for Real Estate Loans” and a common

law trademark, “Resource Lenders.”

Two elements are analyzed to show service mark infringement

under either the federal or common law: (1) existence of a

protectable service mark and (2) likelihood of confusion. 

Surfvivor Media, Inc. v. Survivor Prods., 406 F.3d 625, 630 (9th

Cir. 2005) (citing KP Permanent Make-Up, Inc. v. Lasting

Impression I, Inc., 543 U.S. 111, 548 (2004)). The first element

is not disputed by the parties. Defendant does not contest

Plaintiff’s federally-registered service mark “Resource Lenders

Your Source for Real Estate Loans” or that it has a common law

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trademark in the term “Resource Lenders.”

Defendant argues that there is nevertheless no infringement

because there is no likelihood of confusion. Courts in the Ninth

Circuit apply an eight-factor test to determine whether a

likelihood of confusion exists: (1) similarity of the marks; (2)

relatedness of the goods or services; (3) common marketing

channels; (4) strength of the mark; (5) evidence of actual

confusion; (6) type of services 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. M2 Software, Inc. v. Madacy Entertainment, 421

F.3d 1073, 1080 (9 Cir. 2005). The federal likelihood-of- th

confusion analysis applies to claims under California law. 

Mallard Creek Indus., Inc. v. Morgan, 56 Cal. App. 4th 426, 434-

35 (1997) (citing Golden Door, Inc. v. Odisho, 646 F.2d 347, 349

(9th Cir. 1980)).

These factors are not “rigidly” weighed. Dreamwerks Prod.

Group v. SKG Studio, 142 F.3d 1127, 1129 (9th Cir. 1998). The

court need not establish that each factor weighs in favor of the

Plaintiff to establish a likelihood of confusion. “Some factors

are much more helpful than others, and the relative importance of

each individual factor will be case specific.... [I]t is often

possible to reach a conclusion with respect to likelihood of

confusion after considering only a subset of the factors.” Thane

Int’l, Inc. v. Trek Bicycle Corp., 305 F.3d 894, 901 (9th Cir.

2001) (citing Brookfield Commc’ns, 174 F.3d at 1054)). The most

important factors are the similarity of the marks, the

relatedness of the services, and the use of a common marketing

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 Defendant asserts it no longer uses the term “RESource 1

Real Estate Mortgage.” (Doc. 17, Def.’s Mem. 8) Plaintiff

asserts Defendant does continue to use the phrase “RESource Real

Estate Mortgage.” (Doc. 20, Pl.’s Reply 5) Plaintiff further

argues that the longer phrases are not defendant’s mark, and

instead, defendant’s mark is the single word “resource” in all of

its forms (“RESource”; “R.E.Source”; and “R.E.*Source”). (Doc.

33, Pl.’s Sur-Reply 3) Plaintiff argues that the term “resource”

appears in much larger font on defendant’s logo than the rest of

the phrase. The law is that “marks must be considered in their

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channel. CSC Brands LP v. Herdez Corp., 191 F. Supp. 2d 1145,

1149 (E.D. Cal. 2001) (citing GoTo.com, 202 F.3d at 1205;

Dreamwerks Prods., 142 F.3d at 1130)).

(a) Similarity of the Marks.

In analyzing the similarity of the marks, they must be

considered in their entirety and as they appear in the

marketplace. M2 Software, 421 F.3d 1073, 1082 (9th Cir. 2005)

(“the trademark is not judged by an examination of its parts, but

rather ‘the validity and distinctiveness of a composite trademark

is determined by viewing the trademark as a whole, as it appears

in the marketplace.’”) (quoting Official Airline Guides, Inc. v.

Goss, 6 F.3d 1385, 1392 (9th Cir. 1993)). Similarity is adjudged

in terms of appearance, sound, and meaning. CSC Brands, 191 F.

Supp. 2d at 1149 (citing GoTo.com, 202 F.3d at 1206); M2

Software, 421 F.3d at 1082. Similarities are weighed more

heavily than differences. CSC Brands, 191 F. Supp. 2d at 1149.

The issue is whether Defendant’s marks “RESource Real Estate

Mortgage” and “R.E.*Source Redefining Real Estate” are similar to

Plaintiff’s marks “Resource Lenders” and “Resource Lenders Your

Resource for Real Estate Loans.” Plaintiff argues the marks are 1

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entirety and as they appear in the marketplace.” Official

Airline Guides, Inc. v. Goss, 6 F.3d 1385, 1392 (9th Cir. 1993);

GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1206 (9th Cir.

2000); M2 Software, 421 F.3d at 1082. Although it is true that

the term “resource” appears in bold and large lettering on

defendant’s mark, it does not follow that defendant’s mark is the

term “resource” alone. Defendant’s mark will therefore be

analyzed as it appears in the marketplace, i.e., “R.E.*Source

Redefining Real Estate.”

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similar because of parallels in the appearance, sound, and

meaning of the terms. Defendant disputes this contention.

First, the appearance of the terms is similar in that they

all use the term “resource.” Also, the term “resource” is

prominent on both. The letter “R” appears in large, bold

lettering on both logos. The term “resource” is the focal point

of each mark, due to both its bold lettering and the fact that it

is the introductory word of each term. However, the letters “E”

and “S” also appear in large, bold lettering on SSI’s logo,

whereas “R” is the only letter on Plaintiff’s logo that appears

in large, bold font. Another difference is that Plaintiff’s logo

has a stylized stack of coins that overlap the stem of the “R”,

whereas defendant’s logo contains a house (represented by a *)

that separates the term resource (i.e., “R.E.*Source”).

The second and third inquiries are whether the marks are

similar in sound and meaning. When pronounced aloud, defendant’s

mark “RESource Real Estate Mortgage” does not sound similar to

“Resource Lenders” or “Resource Lenders Your Source for Real

Estate Loans.” However, these phrases do have a similar meaning,

in that both refer to resource in the context of real estate

loans or mortgages. By contrast, defendant’s mark “R.E.*Source

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Defendant asserts that the marks do not sound similar 2

because, when pronouncing the term “RESource,” employees of its

business say “R [pause] E [pause] source” (“är [pause]  [pause]

sÇrs”) instead of pronouncing the term as it appears in the

dictionary (“r’sÇrs”). cite. Although the ultimate holding is

that the marks do not sound similar, this holding is not based on

defendant’s argument regarding how employees of SSI pronounce the

term “resource.” One does not naturally pronounce the term as

defendant pronounces it. Instead the natural pronunciation is

“r’sÇrs.” The punctuation and capitalization used by Defendant

do not change this.

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Redefining Real Estate” does not contain either the word

“mortgage” or the word “loan” and is even less similar in sound

and meaning to Plaintiff’s marks. 

2

Defendant cites case law holding that marks that bear some

resemblance to each other were nevertheless found to be

dissimilar. See, e.g., Official Airline Guides, 6 F.3d at 1393

(holding district court did not err in finding mark “OAG TRAVEL

PLANNER” was not similar in sound and meaning to “THE TRAVEL

PLANNER USA” or “USA TRAVEL PLANNER”, but that it was similar in

sound and meaning to “THE TRAVEL PLANNER”); Entrepreneur Media,

Inc. v. Smith, 279 F.3d 1135, 1145-46 (9th Cir. 2002) (holding

that a reasonable juror could find the marks “EntrepreneurPR” and

“Entrepreneur” to be dissimilar in sound and meaning, although

the terms appear similar at first glance); Miss World Ltd. v.

Mrs. America Pageants, Inc., 856 F.2d 1445, 1449 (9th Cir. 1988)

(holding that, despite some similarities in appearance, sound,

and meaning, marks “Mrs. of the World” and “Miss World” were

dissimilar), abrogated in part on other grounds, Eclipse Assoc.

Ltd. v. Data Gen. Corp., 894 F.2d 1114, 1116 n. 1 (9th Cir. 1990)

(noting that the court in Miss World “misstated the standard of

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review” for a district court’s finding of likelihood of

confusion); but see See Surfvivor, 406 F.3d at 633 (holding that

similarity factor did not favor either party where disputed marks

were “Surfvivor” and “Survivor); M2 Software, Inc. v. Madacy, 421

F.3d 1073, 1083 (9th Cir. 2005) (holding that similarity factor

only slightly favored Plaintiff where marks were

“M2 Entertainment” and “M2”).

However, the law is that similarities of marks are weighed

more heavily than their differences. CSC Brands, 191 F. Supp. 2d

at 1149; GoTo.com, 202 F.3d at 1206; Rodeo Collection, 812 F.2d

at 1219. 

The strongest similarity between the marks is the prominence

and sound of the term “resource,” in relation to home loans. 

This similarity harms Plaintiff. The RESource term has

differences in visual appearance, sound, and meaning that favor

Defendant as to this term.

(b) Relatedness of the Services Provided.

 The next factor is the extent to which the services

provided by the parties are related. “Where the [services] are

related or complementary, the danger of confusion is heightened.” 

M2 Software, 421 F.3d at 1082. “The parties’ [services] need not

be identical or directly competitive...for there to be a

likelihood of confusion. They need only be related in some

manner, or the conditions surrounding their marketing be such

that they could be encountered by the same purchaser under

circumstances that could give rise to the mistaken belief that

the goods come from a common source.” Moose Creek, Inc. v.

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Abercrombie & Fitch Co., 331 F. Supp. 2d 1214, 1226 (C.D. Cal.

2004).

Plaintiff’s sole business is providing real estate loans. 

Defendant’s primary business is real estate sales, but it also

provides real estate loans. The parties’ customer base is the

same. While the parties’ businesses are similar, they are not

identical, as Plaintiff contends. Both parties provide real

estate mortgages and serve the same customer base. This factor

weighs in favor of a finding of likelihood of confusion.

(c) Use of Common Marketing Channel.

“Convergent marketing channels increase the likelihood of

confusion.” M2 Software, 421 F.3d at 1083 (quoting Nutri/System,

Inc. v. Con-Stan Indus., Inc., 809 F.2d 601, 606 (9th Cir.

1987)). Plaintiff argues that it uses the same primary marketing

channel as Defendant, i.e., the print media. (Doc. 20, Pl.’s

Reply 7) Plaintiff attaches one of Defendant’s advertisements in

a local magazine, Guide to Better Homes. (Doc. 34, Miller Supp.

Decl., Ex. F) Plaintiff does not have an advertisement in this

magazine, but does advertise in what it characterizes as

“competing publications,” including The Real Estate Book

magazine, Real Estate Showcase, and The Fresno Bee. (Doc. 34,

Miller Supp. Decl. Exs. G-I) 

Plaintiff also uses the internet to advertise. Defendant

concedes it owns websites, but denies that it uses the websites

to advertise. (Doc. 17, Def.’s Mem. 9) Instead, Defendant uses

the websites to recruit and hire employees. (Id. (citing Wren

Decl. ¶ 13)) Defendant also contends that customers cannot find

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its website through search engines, and can only find the website

by previously knowing the URL and typing it into an internet web

browser. However, Plaintiff asserts that Defendant’s business

cards direct users to the defendant’s website. (Doc. 20, Pl.’s

Reply 7).

Based upon the parties’ submissions, the primary channel of

marketing is the print media. This factor weighs in favor of a

finding of likelihood of confusion.

(d) Strength of the Mark.

In the Ninth Circuit, the strength of a mark is measured

depending upon how distinctive the mark is. Surfvivor Media, 406

F.3d at 631; M2 Software, 421 F.3d at 1080. The more descriptive

the mark, the weaker it is. Id. Marks are classified as

generic, descriptive, suggestive, or arbitrary. Id. An

arbitrary or fanciful mark is the most distinctive. Id. If a

mark is more descriptive, then the moving party must establish

that a greater degree of secondary meaning has attached to the

mark as the result of commercial success. M2 Software, 421 F.3d

at 1081 (“Our court has previously recognized that a suggestive

or descriptive mark, which is conceptually weak, can have its

overall strength as a mark bolstered by its commercial success.”)

(citing cases).

Plaintiff argues that its marks are arbitrary and that they

are entitled to the highest degree of protection. In the

alternative, Plaintiff argues that this factor weighs in its

favor because its marks have acquired secondary meaning within

its market.

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Defendant argues that Plaintiff’s marks are weak because 3

“resource” is used widely in the real estate field. 

Specifically, Defendant argues that Plaintiff’s mark is

conceptually weak based on a “crowded field” theory, which holds

that a mark, even if not necessarily descriptive, is nevertheless

weak due to its existence in a market of similar marks. Miss

World, 856 F.3d at 1449 (“In such a crowd, customers will not

likely be confused between any two of the crowd and may have

learned to carefully pick out one from the other.”). In support

of its argument, defendant cites the Department of Real Estate’s

list of licenses (92 companies with the term “resource”);

California Secretary of State’s corporate/LP/LLP listings (8

companies using the term “resource” and “real estate” in their

title); and the U.S. Patent & Trademark Office (six pending or

issued trademarks use the combination of “resource” and “real

estate”). (Doc 17, Def.’s Opp. 6)

Defendant has produced no evidence that the term “resource”

is widely used in the real estate field in the Central Valley of

California. Even if defendant had produced such evidence, it

would not necessarily overcome Plaintiff’s showing that its marks

have obtained secondary meaning in the Central Valley.

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Here, Plaintiffs’ mark “Resource Lenders” is suggestive. 

Although it does not necessarily evoke the meaning, real estate

loans, the term “lenders” does evoke loans. Plaintiff’s mark

“Resource Lenders Your Source for Real Estate Loans” is

descriptive, since it describes the services offered by

Plaintiff’s company. Plaintiffs’ marks are relatively weak. 

Plaintiff must establish some secondary meaning in order for this

factor to weigh in its favor.3

Secondary meaning is “the mental association by a

substantial segment of consumers and potential consumers between

the alleged mark and a single source of the product [or

service].” Levi Strauss & Co. v. Blue Bell, Inc., 778 F.2d 1352,

1354 (9th Cir. 1985). In determining whether secondary meaning

has attached, the following factors are considered: “(1) whether

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 David Spurlock (real estate appraiser); Joyce Simas (real 4

estate agent); Anthony Gamber (real estate agent); Paul Parano

(real estate agent); Don Fulmer (tools distributor); Marnie

Gotfried (recent real estate refinancing customer); Mark Crawford

(insurance agent); Sandy Richardson (recent Resource Lenders

customer); Teddi Peters (Madera real estate agent); Mark Barsotti

(title company employee). 

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actual purchasers of the product [or service] bearing the claimed

trademark associate the trademark with the producer [or service

provider], (2) the degree and manner of advertising under the

claimed trademark, (3) the length and manner of use of the

claimed trademark, and (4) whether use of the claimed trademark

has been exclusive.” Yellow Cab Co. of Sacramento v. Yellow Cab

of Elk Grove, Inc., 419 F.3d 925, 930 (9th Cir. 2005) (quoting

Levi Strauss, 778 F.2d at 1354). 

Plaintiff has submitted evidence regarding all four of these

factors to support its contention that its marks have acquired

secondary meaning in its market, the Central Valley of

California. First, Plaintiff has submitted evidence that its

mark is associated with its company, specifically nine

declarations of various real estate agents, employees of title

companies, appraisers, and customers who work or live in the

Central Valley. (Docs. 36-45) These individuals all testify in 4

their declarations that “[w]henever anyone makes reference to

‘Resource’ or ‘Resource Lenders’ I immediately think of

[Plaintiff’s] business.” In addition to these declarations,

Plaintiff has also submitted evidence of a survey conducted by

Media Specialists, a marketing survey company. (Doc. 35, Walker

Decl.) Four hundred three (403) respondents were telephoned from

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Friday, September 23, 2005, through Monday, September 26, 2005. 

(Id. at ¶ 3) Of the respondents who had obtained a home loan in

the last 5 years, 40.21% were familiar with RESOURCE LENDERS. 

The recognition score of a competitor (Royal Charter) among the

same group was 14.43%. (Id. at ¶ 9) Of all the respondents,

23.57% recognized RESOURCE LENDERS’ name. (Id. at ¶ 6) 

Defendant objects that the declarants’ association of the

word “resource” with Plaintiff’s business is irrelevant. 

Defendant argues that “the only issue before the [c]ourt is

whether Defendant’s mark is confusingly similar in sight, sound,

and meaning to the marks Plaintiff has actually used in commerce:

‘Resource Lenders’ and ‘Resource Lenders Your Resource For Real

Estate Loans.’” Defendant does not otherwise object to the

affidavits. Defendant’s objection is misplaced as a confusion

survey or secondary meaning (identification) is a classic method

of proving public identification of a claimant with the contested

trade name. 

Second and third, Plaintiff has submitted the declaration of

the president of RESOURCE LENDERS regarding the amount of

advertising using the mark and the length of time Plaintiff has

used the mark in advertising. (Doc. 8, Barnes Decl. ¶ 7) 

Specifically, RESOURCE LENDERS has engaged in advertising and

promotion of its services under the name “Resource Lenders” for

the past 15 years, including ads in newspapers, on the radio, and

on signs, including the scoreboard at Grizzlies Stadium in

Fresno. Additionally, the advertising expenditures for RESOURCE

LENDERS over the past three years have averaged just over

$100,000 per year. Fourth and finally, there is no evidence that

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Plaintiff concedes that the first caller was looking for a 5

real estate agent, which is a service provided by Defendant but

not by Plaintiff.

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any other real estate mortgage company has used a mark beginning

with the term “resource” in the Central Valley of California.

Plaintiff has submitted sufficient evidence to show a

likelihood of success in establishing that its mark, RESOURCE

LENDERS, has acquired secondary meaning in its market, the

Central Valley of California. This factor weighs in favor of

Plaintiff.

(e) Evidence of Actual Confusion.

Plaintiff provides two examples of actual confusion in its

reply. One was a phone call to RESOURCE LENDERS from a man who

wanted to speak to a specific real estate agent. RESOURCE

LENDERS’ clerk informed the caller that RESOURCE LENDERS did not

have any real estate agents--only loan officers. The caller then

said, “Aren’t you Resource?” The caller then asked whether the

office he called was still located near Shaw Avenue and Sixth

Street, in Fresno. (Olander Decl. ¶ 2) The other example

Plaintiffs provide is another phone call from a woman who asked

whether the office was located on Shaw Avenue near the Old

Spaghetti Factory. Defendant’s former office was located on

Sixth Street near Shaw.5

Plaintiff correctly notes that evidence of actual confusion

is not determinative in actions seeking injunctions for service

mark infringement such as this one. Rodeo Collection, Ltd. v.

West Seventh, 812 F.2d 1215, 1219 (9th Cir. 1987); see also Cohn

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v. Petsmart, Inc., 281 F.3d 837, 842 (9th Cir. 2002) (“Because

evidence of actual confusion can be difficult to obtain, its

absence is ‘generally unnoteworthy’ and is given little probative

weight.” (quoting Brookfield Commc’ns, 174 F.3d at 1050)). 

However, evidence of actual confusion is a useful factor and

is not entirely disregarded by courts in their analyses. 

Surfvivor Media, 406 F.3d at 633 (scant evidence of actual

confusion weighted against Plaintiff seeking to establish

likelihood of confusion); Glow Indus. Inc. v. Lopez, 273 F. Supp.

2d 1095, 1124-25 (C.D. Cal. 2003) (noting that while evidence of

actual confusion is not necessary to prevail on an infringement

claim, lack of any such evidence weighed against finding of

likelihood of confusion). 

Defendant argues that the phone calls are not evidence of

actual confusion because the callers were looking for defendant’s

business and not for Plaintiff’s business. As Plaintiff argues,

however, confusion is confusion, and that it is irrelevant that

the callers were looking for defendant’s business. That the

callers mistakenly placed a call to the business they were not in

fact looking for is evidence of actual confusion.

The two phone calls are the only evidence of actual

confusion that Plaintiff submitted. This factor weighs only

slightly in favor of a finding of likelihood of confusion.

(f) Type of Service Provided & Degree of Care

Exercised by Consumers.

The service provided by Plaintiff is arranging real estate

loans. The services provided by Defendant are conducting real

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estate sales and providing real estate loans. In evaluating the

type of service provided, an important factor is the degree of

care likely to be exercised by an individual seeking a real

estate loan in choosing a loan provider. In analyzing this

issue, courts ask what is expected of a reasonably prudent

consumer, who: 

is more discerning--and less easily confused-

-when he is purchasing expensive items, see,

e.g., Official Airline Guides, 6 F.3d at 1393

(noting that confusion was unlikely among

advertisers when the products in question

cost from $2,400 to $16,000), and when the

products being sold are marketed primarily to

expert buyers, see, e.g., Accuride Int’l,

Inc. v. Accuride Corp., 871 F.2d 1531, 1537

(9th Cir. 1989). ... On the other hand, when

dealing with inexpensive products, customers

are likely to exercise less care, thus making

confusion more likely. See, e.g., Gallo, 967

F.2d at 1293 (wine and cheese).

Brookfield Commc’ns, 174 F.3d at 1060.

Most real estate loans involve a large investment, causing a

reasonably prudent consumer to be more discerning in choosing a

mortgage loan provider, making confusion is less likely. See

id.; see also Franklin First, 356 F. Supp. 2d at 1052 (relying on

party’s declaration that “Mortgage loans often exceed $100,000;

for many people, a home-mortgage loan is the single most

important expenditure of their lives.”)

Plaintiff argues that mortgage loan seekers are not likely

to do more than internet and phone shopping before choosing a

mortgage loan provider and that this factor therefore tips in

favor of a finding of likelihood of confusion. Plaintiff notes

that a verbal referral to Plaintiff as “resource” could result in

a call to defendant. Defendant argues first that it does not use

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keywords for its websites, so a customer could not find its

business in an internet search. Plaintiff’s arguments based on

the internet are therefore not persuasive. Second, defendant

argues the names of defendant and Plaintiff’s companies are not

found near each other in the phone book, where defendant is

listed under “R.E.” and Plaintiff is listed under “Resource.”

Plaintiff provides no evidence regarding how customers go

about choosing a mortgage loan provider. Although the court in

Franklin First found that the degree of customer care was high,

it relied on evidence submitted by the parties. Here, there is

no such evidence. Plaintiff has produced evidence that its mark

has secondary meaning and is recognized by customers and

potential customers in the Central Valley of California, which is

circumstantial evidence supporting Plaintiff’s argument that a

verbal reference to “Resource” will result in a call to

defendant. This factor slightly favors a finding of likelihood

of confusion.

(g) Defendant’s Intent in Selecting the Mark.

“It is settled that ‘[a] party claiming trademark

infringement need not demonstrate that the alleged infringer

intended to deceive consumers’” M2 Software, 421 F.3d at 1085

(quoting E. & J. Gallo, 967 F.2d at 1293)). However, “[w]hen the

alleged infringer knowingly adopts a mark similar to another’s,

[it is] presume[d] that the public will be deceived.” Id.

(citing Sleekcraft, 599 F.2d at 354); see also Interstellar

Starship Svcs., Ltd. v. Epix Inc., 184 F.3d 1107, 1111 (9th Cir.

1999) (“Adopting a designation with knowledge of its trademark

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status permits a presumption of intent to deceive.”). The intent

factor is relevant to the extent it bears upon the likelihood

that consumers will be confused. Brookfield Commc’ns, 174 F.3d

at 1059. If there is little or no likelihood of confusion, then

the intent cannot be inferred. Id.

Plaintiff argues, without citing any evidence or legal

authority, that Defendant’s intent to confuse or infringe in

choosing a mark with the term “resource” can be inferred based on

speculation that a call to directory assistance seeking a real

estate loan company named “Resource” might mistakenly be directed

to Defendant instead of Plaintiff. Plaintiff also argues that a

word-of-mouth referral to a real estate loan provider named

“Resource” could similarly misdirect a customer to Defendant

instead of Plaintiff.

Defendant denies that it knew about Plaintiff’s mark before

it chose its name. (Doc. 17, Def.’s Opp. 10) Defendant’s

company is named Source Solutions, and Defendant asserts that it

initially chose the name RESource Real Estate Mortgage to

represent it as the “Source for Real Estate Homes and Loans.” 

(Doc. 17, J.C. Wren Decl. ¶ 2; T. Wren Decl. ¶ 4) Plaintiff

argues that Defendant’s use of the name “Resource” is

nevertheless “suspect,” basing its argument on the declaration of

Tara Wren, an officer of SSI, who stated that when she filed

SSI’s original fictitious business statement and a statement with

the California Department of Real Estate, she understood that SSI

was not allowed to have a d/b/a that was the same as another

company’s. Ms. Wren filed SSI’s d/b/as as “Re-Source” and

“Resource.” 

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Plaintiff has not provided evidence that defendant knew of

its existence before Defendant adopted its name. This factor

does not weigh in Plaintiff’s favor.

(h) Likelihood of Expansion of the Product Lines.

For the likelihood of expansion factor to weigh in favor of

the service mark holder, it must show that the “existence of the

allegedly infringing mark is hindering the Plaintiff’s expansion

plans.” Surfvivor Media, 406 F.3d at 634. This factor weighs in

favor of the service mark holder if there is a “strong

possibility of expansion into competing markets.” M2 Software,

421 F.3d at 1085 (quoting E. & J. Gallo, 967 F.2d at 1293)

(emphasis added). However, where the parties compete closely,

both geographically and in the same services offered, the

likelihood of expansion “is relatively unimportant.” Petsmart,

281 F.3d at 843 (citing Brookfield Commc’ns, 174 F.3d at 1060).

 Plaintiff argues that both its business and defendant’s

business are growing. Plaintiff states that, since its business

opened 15 years ago, it has expanded beyond Fresno to

Bakersfield, Visalia, Porterville, Hanford, and San Luis Obispo. 

Plaintiff also notes that one of SSI’s officers stated his

declaration that its business is “rapidly growing” and that it

has a website set up for recruiting. (Doc. 17, J.C. Wren ¶ 13)

Plaintiff’s self-identified market is the Central Valley of

California. Plaintiff offers no evidence that there is a strong

possibility of expansion to markets outside the Central Valley. 

This factor does not weigh in favor of Plaintiff.

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(i) Conclusion.

Plaintiff’s evidence establishes that likelihood of

confusion exists between Defendant’s use of the terms RESource or

R.E.*Source in connection with the real estate lending business. 

The term “R.E.*Source Redefining Real Estate,” is less similar to

Plaintiff’s marks, but “Resource Lenders” and “Resource Lenders

Your Resource For Real Estate Loans” are deserving of protection

by way of injunctive relief.

2. Trade Name Infringement (Cal. Bus. & Prof. Code

§ 14330).

“Trademarks (i.e., symbols used to identify and distinguish

goods or services) and trade names (i.e., symbols used to

distinguish companies, partnerships and businesses) are

technically distinct; the major legal distinction between the two

is that ‘trade names cannot be registered and are therefore not

protected under 15 U.S.C. § 1114.’” First Franklin, 356 F. Supp.

2d at 1050 (quoting Accuride Int’l, Inc. v. Accuride Corp., 871

F. 2d 1531, 1534-35 (9th Cir. 1989)). Under California law,

there is a rebuttable presumption that, upon filing articles of

incorporation, the corporation has the “exclusive right to use

the name set forth in the articles or certificate as well as any

confusingly similar name.” Mallard Creek Indus., Inc. v. Morgan,

56 Cal. App. 4th 426, 433 (1997); Kelley Blue Book v. CarSmarts, Inc., 802 F. Supp. 278, 289 (C.D. Cal. 1992) (citing

American Petrofina, Inc. v. Petrofina of California, Inc., 596

F.2d 896 (9th Cir. 1979)). 

Plaintiff’s name, as set forth in the articles of

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incorporation, which Plaintiff filed with the California

Secretary of State in 1990, is “Resource Lenders.” Plaintiff

does not allege that Defendant is using this name. The use of

the term “Resource” for Defendant’s real estate loan business is

confusing. Plaintiff has established a likelihood of success on

its trade name infringement claim. 

3. Dilution (15 U.S.C. § 1125(c); Cal. Bus. & Prof.

Code § 14330).

Injunctive relief is available under the Federal Trademark

Dilution Act if a Plaintiff can establish that (1) its mark is

famous; (2) the defendant is making commercial use of the mark in

commerce; (3) the defendant’s use began after the Plaintiff’s

mark became famous; and (4) there is actual harm to the trademark

holder. Nissan Motor Co. v. Nissan Computer Corp., 378 F.3d

1002, 1010 (9th Cir. 2004). In addition, the Plaintiff must

initially show that the defendant’s mark is identical or nearly

identical. Id. at 1011; Thane Int’l, Inc. v. Trek Bicycle Corp.,

305 F.3d 894 (9th Cir. 2002). The analysis for California state

law dilution is the same as that for a federal dilution claim. 

Panavision Int’l L.P. v. Toeppen, 141 F.3d 1316, 1324 (9 Cir. th

1998). Likelihood of confusion is not an element of dilution. 

Nissan Motor, 378 F.3d at 1011 (“Dilution is ‘the lessening of

the capacity of a famous mark to identify and distinguish goods

or services, regardless of the presence or absence of (1)

competition between the owner of the famous mark and other

parties, or (2) likelihood of confusion, mistake or deception.”)

(quoting 15 U.S.C. § 1127); Thane, 305 F.3d at 904. 

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Defendant argues that Plaintiff is not entitled to

injunctive relief because Plaintiff cannot establish a likelihood

of success on its dilution claim. Specifically, defendant argues

that defendant’s mark is not identical to Plaintiff’s, that

Plaintiff’s mark is not famous, and that Plaintiff cannot show

actual dilution of its mark.

First, Plaintiff argues that its marks “Resource Lenders

Your Source for Real Estate Loans” and “Resource Lenders” are

identical to Defendant’s marks using the term “resource,”

including “R.E.Source,” “R.E.Source Redefining Real Estate,” and

“R.E.*Source.” In the Ninth Circuit, courts use the “identical

or nearly identical” standard. Thane, 305 F.3d at 907. Under

this standard, marks are considered “identical” in a dilution

analysis where they are “similar enough that a significant

segment of the target group of customers sees the two marks as

essentially the same.” Thane, 305 F.3d at 906 (internal

quotations and citations omitted). In Thane, the court found

that a reasonable fact-finder could conclude TREK and OrbiTREK

marks are nearly identical. Id. at 907. 

Although both the Plaintiff’s marks and the Defendant’s mark

feature the word “resource” prominently, the word is presented

differently in the respective marks, and is succeeded by

different words. The marks are not identical or nearly

identical.

Second, Plaintiff argues that its mark is famous within a

niche market as defined by the Ninth Circuit in Thane. Thane,

305 F.3d at 908 (“[M]arks famous in only a limited geographic

area or a specialized market segment can be found ‘famous’ for

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the purposes of the federal anti-dilution statute.”) (quoting

Avery Dennison, 189 F.3d at 877). Niche fame protection is

limited to the extent that the alleged diluter uses the mark

within the niche. Id. There is no dispute that Defendant uses

the allegedly infringing marks within the niche market of the

Fresno and Central Valley area. Defendant does dispute that

Plaintiff’s mark is famous, and argues that Plaintiff has also

failed to establish a likelihood of success on its dilution claim

for this reason.

The federal anti-dilution statute provides eight factors for

courts to consider in determining whether a mark is famous:

(A) the degree of inherent or acquired

distinctiveness of the mark;

(B) the duration and extent of use of the

mark in connection with the goods or

services with which the mark is used;

(C) the duration and extent of advertising

and publicity of the mark;

(D) the geographical extent of the trading

area in which the mark is used;

(E) the channels of trade for the goods or

services with which the mark is used;

(F) the degree of recognition of the mark in

the trading areas and channels of trade

used by the marks’ owner and the person

against whom the injunction is sought;

(G) the nature and extent of use of the same

or similar marks by third parties; and

(H) whether the mark was registered under

the Act of March 3, 1881, or the Act of

February 20, 1905, or on the principal

register.

15 U.S.C. § 1125(c)(1). Plaintiff argues that its marks are

famous under these factors because it used them in advertising

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for the past fifteen years in the Fresno and Central Valley area. 

Plaintiff argues that its marks have acquired and inherent

distinctiveness. Defendant disputes Plaintiff’s contentions, and

argues that Plaintiff’s marks are neither distinctive nor famous

because many other real estate businesses in the Central Valley

use the term “resource” in their names.

Dilution usually protects marks such as “KODAK,” “Buick,”

and “Coca-Cola” that are well-known to the general public to the

point of being “household names.” See Thane, 305 F.3d at 906;

Avery Dennison Corp. v. Sumpton, 189 F.3d 868, 875 (9th Cir.

1999) (“Dilution is a cause of action invented and reserved for a

select class of marks--those marks with such powerful consumer

associations that even non-competing uses can impinge on their

value.”). The only evidence Plaintiff has submitted of the

famousness of its mark is the limited survey evidence, which

showed that about 40% of a sample of persons in the Central

Valley home loan market were familiar with Resource Lenders. 

Even if Central Valley home loan purchasers meet the requirements

of a niche market as defined in Thane, recognition by 40% of a

niche market is not sufficient to establish the degree of

famousness and recognition required for a dilution claim. Avery

Dennison, 189 F.3d at 875 (“to meet the ‘famousness’ element of

protection under the dilution statutes, a mark must be truly

prominent and renowned.” (internal quotation and citation

omitted.)). Although Plaintiff has submitted some evidence in

support of a few of the famousness elements, Plaintiff has failed

to produce evidence that shows a likelihood of success in

establishing the famousness element of its dilution claim.

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Plaintiff has not established a likelihood of success on the

merits of its dilution claim.

4. Unfair Competition and Unfair Business Practices;

False Designation of Origin (Cal. Bus. & Prof.

Code § 17000, et seq., § 17200; 15 U.S.C.

§ 1125(a)).

A claim for unfair competition under Cal. Bus. & Prof. Code

§ 17200 and false designation of origin under § 1125(a)(1)(A) are

analyzed in the same manner as a claim for trademark

infringement. M2 Software, 421 F.3d at 1080, n. 5. The test for

unfair competition and false designation of origin is the same as

for trademark infringement, i.e., likelihood of confusion. Id.;

Thane, 305 F.3d at 901 n. 3. 

The court has found that a likelihood of confusion exists

between the Plaintiff’s and Defendant’s marks. The Plaintiff is

therefore likely to prevail on the merits of its Unfair

Competition and Unfair Business Practices and False Designation

of Origin claims. 

B. Irreparable Harm to Plaintiff; Balance of Hardships;

Service to Public Interest.

In trademark infringement and unfair competition cases, once

likelihood of confusion is established, it is usually presumed

that the Plaintiff will suffer irreparable harm and that the

balance of hardships tips in Plaintiff’s favor. Vision Sports,

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

GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1209 (9th Cir.

2000) (because Plaintiff succeeded in establishing likelihood of

confusion, court “need not decide whether there exist serious

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questions on the merits or whether the balance of hardships tips

sharply in favor of Plaintiff”).

Plaintiff argues that the balance of hardships tips in its

favor. Plaintiff argues that SSI continues to use the term

“resource” in new advertising, and cites as an example the

appearance of “R.E.*Source Real Estate Mortgage” in the September

and October 2005 editions of Guide to Better Homes, The Central

Valley’s Real Estate Publication. (Doc. 20, Pl.’s Reply 8; Doc.

33, Pl.’s Sur-Reply). Plaintiff contends these are not “holdover

uses” or “infrequent and mistaken uses” as SSI claims. Defendant

argues that it will be harmed by an injunction because changing

its name once again will cause disruption to its business. 

Plaintiff argues that changes such as modifying business cards,

letterhead, and telephone directory listings are minor costs. 

“It is well established that trademark law protects not only

the private interests of the trademark owner but also the

public’s interest in not being confused by the infringing

products.” Phillip Morris USA Inc. v. Shalabi, 352 F. Supp. 2d

1067, 1075 (C.D. Cal. 2004) (citing Inwood Labs., Inc. v. Ives

Labs. Inc., 456 U.S. 844, 854 n. 14 (1982)). In trademark

infringement cases, the public interest is served when an

injunction would protect the “right of the public not to be

deceived or confused.” Id. (quoting Opticians Ass’n of Amer. v.

Indep. Opticians of Amer., 920 F.2d 187, 197 (3d Cir. 1990)). 

Here, because a likelihood of confusion was demonstrated,

the public interest would be served by issuance of an injunction.

IV. CONCLUSION

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Plaintiff’s motion for preliminary injunction is GRANTED

against Defendant’s use of the terms “Resource,” “RESource,” or

“R.E.*Source” for any advertising or commercial use of that term

in connection with the real estate loan business. Plaintiff

shall submit a form of preliminary injunction within three (3)

days of service of this order. 

SO ORDERED. 

DATED: December _12__, 2005. 

/s/ OLIVER W. WANGER 

______________________________

 Oliver W. Wanger

UNITED STATES DISTRICT JUDGE

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