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Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.'S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

JEFFREY C. HALLAM (State Bar No. 161259) 

E-Mail: jhallam@sideman.com 

ZACHARY J. ALINDER (State Bar No. 209009) 

E-Mail: zalinder@sideman.com 

ELLEN P. LIU (State Bar No. 280459) 

E-Mail: eliu@sideman.com

SIDEMAN & BANCROFT LLP 

One Embarcadero Center, Twenty-Second Floor 

San Francisco, California 94111-3711 

Telephone: (415) 392-1960 

Facsimile: (415) 392-0827 

Attorneys for Plaintiff 

FITBIT, INC. 

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

FITBIT, INC., a Delaware Corporation, 

Plaintiff, 

v. 

LAGUNA 2, LLC, a New Jersey Limited 

Liability Company; JOEL BLANK, an 

individual; CALI RESOURCES, INC. dba 

BUY NOW FACTORY DIRECT, a California 

Corporation; CARLOS KELVIN, an 

individual; GREAT VALUE, LLC, a 

California Limited Liability Company; PCOVE ENTERPRISES INC. dba BUYERS 

CONSULTATION SERVICE, a California 

Corporation; ENVIRONMENTAL 

LIQUIDATION, INC., a California 

Corporation; JONATHAN MANHAN, an 

individual; FRANCIS MICHAEL BAKER aka 

MIKE BAKER, an individual; MI 

TECHNOLOGIES, INC. dba DISCOUNT 

MERCHANT, a California Corporation, 

AMIR TAFRESHI, an individual, 

INNOVATIVE ENTERPRISES, INC. dba 

THE MERCHANT KING, a California 

Corporation; JOUBIN RAHIMI, an individual, 

and DOES 12-30, inclusive, 

Defendants. 

 Case No. 3:17-cv-00079-EMC 

PLAINTIFF FITBIT, INC.’S 

OPPOSITION TO MOTIONS TO 

DISMISS FILED BY CALI DEFENDANTS 

AND L2 DEFENDANTS 

Judge: Honorable Edward M. Chen 

Date: September 28, 2017 

Time: 1:30 p.m. 

Court Room: 5, 17th Floor 

Trial Date: None Set

Case 3:17-cv-00079-EMC Document 107 Filed 09/05/17 Page 1 of 30
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i Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

TABLE OF CONTENTS 

Page 

I. INTRODUCTION ................................................................................................................. 1

II. RELEVANT FACTUAL ALLEGATIONS .......................................................................... 3

A. The Scrap Products Were Not “Sold” To BCS ......................................................... 3

B. The Scrap Product Shipments Were Materially Different ........................................ 4

C. The Cali Defendants’ Relevant Unlawful Conduct ................................................... 5

D. Defendant Great Value .............................................................................................. 8

E. The L2 Defendants .................................................................................................... 9

III. RELEVANT PROCEDURAL BACKGROUND ............................................................... 10

A. The TRO Briefing and Court Order on the First Sale Doctrine .............................. 10

B. The L2 Defendants’ First Motion to Dismiss .......................................................... 11

C. The Cali Defendants’ First Motion to Dismiss and Answer ................................... 12

IV. LEGAL STANDARDS ON A MOTION TO DISMISS .................................................... 12

V. DEFENDANTS’ MOTIONS TO DISMISS FAIL AS A MATTER OF LAW AND 

BASED ON THE FACTS ALLEGED IN THE AMENDED COMPLAINT .................... 13

A. Both Motions Are Procedurally Improper And Untimely....................................... 13

B. The Court Should Reject Defendants’ Request To Reconsider Its Prior 

Ruling On The First Sale Doctrine, And It Is Inapplicable Here In Any 

Event ........................................................................................................................ 14

C. Defendants’ Remaining Grab-Bag Of Arguments All Fail To Raise Any 

Pleading Defect Here .............................................................................................. 21

1. Fitbit’s Complaint States A Claim Against Defendants Cali and 

Kelvin for Conspiracy to Defraud ............................................................... 21

2. Fitbit’s Complaint States A Claim Against Defendants for 

Counterfeiting .............................................................................................. 23

3. The Cali Defendants’ Vague Catch-All Argument Fails As Well .............. 24

D. The Cali Defendants Do Not Assert Any Separate Or Distinct Basis To 

Challenge The SAC On Behalf Of Defendant Great Value .................................... 24

VI. CONCLUSION ................................................................................................................... 25 

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ii Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

TABLE OF AUTHORITIES 

 Page(s) 

Cases 

Ally Bank v. Castle, 

11–CV–896 YGR, 2012 WL 3627631 (N.D. Cal. Aug. 20, 2012) ......................................22, 23 

Analog Devices v. West Pac. Indus., 

152 F.3d 923 (9th Cir. 1998) ......................................................................................................19 

Arizona v. California, 

460 U.S. 605 (1983) ...................................................................................................................15 

Ashcroft v. Iqbal, 

556 U.S. 662 (2009) ...................................................................................................................12 

Beltronics USA, Inc. v. Midwest Inventory Distribution, LLC, 

562 F.3d 1067 (10th Cir. 2009) ..................................................................................................20 

Chaffee v. Boston Belting Co., 

63 U.S. 217 (1859) .....................................................................................................................18 

Conley v. Gibson, 

355 U.S. 41 (1957) .....................................................................................................................12 

F.T.C. v. Wellness Support Network, Inc., 

2011 WL 4026867 (N.D. Cal. Sept 12, 2011) ......................................................................13, 14 

Facebook, Inc. v. MaxBounty, Inc., 

5:10–CV–04712–JF HRL, 2011 WL 4346514 (N.D. Cal. Sept. 14, 2011) ...............................22 

FURminator, Inc. v. Kirk Weaver Enterprises, Inc., 

545 F.Supp.2d 685 (N.D. Ohio April 7, 2008) ...............................................................16, 17, 18 

General Talking Pictures Corp. v. Western Elec. Co., 

305 U.S. 124 (1938) ...................................................................................................................18 

Grateful Palate Inc. v. Joshua Tree Imps., LLC, 

220 Fed. Appx. 635 (9th Cir. 2007) ...........................................................................1, 11, 15, 20 

Greenwood v. Mooradian, 

137 Cal. App. 2d 532 (1955) ......................................................................................................23 

Hokto Kinoko Co. v. Concord Farms, Inc., 

810 F. Supp. 2d 1013 (C.D. Cal. 2011) ..................................................................................1, 11 

Idaho Potato Comm’n v. G&T Terminal Pkg., Inc., 

425 F.3d 708 (9th Cir. 2005) ............................................................................................2, 11, 21 

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iii Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

Impression Prods. v. Lexmark Int’l, Inc., 

__ U.S. __, 137 S.Ct. 1523 (2017) .......................................................................................17, 18

Knievel v. ESPN, 

393 F.3d 1068 (9th Cir. 2005) ....................................................................................................12 

Liz Claiborne, Inc. v. Mademoiselle Knitwear, Inc., 

979 F.Supp. 224 (S.D.N.Y. 1997) ..............................................................................................15 

Lopez v. Smith

203 F.3d 1122 (9th Cir. 2000) ....................................................................................................13 

McCarthy v. Fuller, 

2013 U.S. Dist. LEXIS 162826 (S.D. Ind. Nov. 15, 2013) ..................................................19, 20 

Microban Products Co. v. API Indus., Inc., 

2014 WL 1856471 (S.D.N.Y May 8, 2014) ...............................................................................16 

Northstar Fin. Advisors, Inc. v. Schwab Investments, 

135 F. Supp. 3d 1059, 1070 (N.D. Cal. 2015) ...........................................................................13 

Opperman v. Path, Inc., 

2014 WL 246972 (N.D. Cal. Jan. 22, 2014) ..............................................................................15 

RFA Brands, LLC v. Beauvais, 

2014 WL 7780975 (E.D. Mich., Dec. 23, 2014) ..................................................................16, 17 

Rolex Watch USA, Inc. v. Agarwal, 

2012 WL 12886444 (C.D. Cal. 2012) ........................................................................................20 

Sebastian Intern., Inc. v. Longs Drug Stores Corp., 

53 F.3d 1073 (9th Cir. 1995) ......................................................................................................19 

SoftMan Prods. Co. v. Adobe Sys., 

171 F. Supp. 2d 1075 (C.D. Cal. 2001) ............................................................................1, 11, 20 

In re Sunset Bay Assocs., 

944 F.2d 1503 (9th Cir. 1991) ..............................................................................................22, 23 

Thomas v. Bible, 

983 F.2d 152 (9th Cir. 1993) ......................................................................................................15 

Transamerica Life Ins. Co. v. Jurin, 

2014 WL 3519205 (N.D. Cal. July 16, 2014) ................................................................21, 22, 23 

Wasco Prods., Inc. v. Southwall Techs., Inc., 

435 F.3d 989 (9th Cir. 2006) ......................................................................................................21 

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iv Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

Other Authorities 

Civil L.R. 7-9 .....................................................................................................................2, 4, 14, 15 

Fed. R. Civ. Proc. Rule 12 ................................................................................................................13 

Fed. R. Civ. Proc. Rule 12(b) .....................................................................................................12, 13 

Fed. R. Civ. Proc. Rule 12(c) ...........................................................................................................13 

Fed. R. Civ. Proc. Rule 12(e) ...........................................................................................................12 

Fed. R. Civ. Proc. Rule 12(g) .....................................................................................................13, 14 

Fed. R. Civ. Proc. Rule 12(h) .....................................................................................................13, 14 

Case 3:17-cv-00079-EMC Document 107 Filed 09/05/17 Page 5 of 30
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1 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

Plaintiff Fitbit, Inc. (“Fitbit” or “Plaintiff”) respectfully submits the following Opposition 

to the Motions to Dismiss Fitbit’s Second Amended Complaint, ECF Nos. 99 and 101, filed by 

Defendants Cali Resources, Inc. (“Cali”), Carlos Kelvin (“Mr. Kelvin”), Great Value, LLC 

(“Great Value,” and together with Cali and Mr. Kelvin, the “Cali Defendants”), as well as 

Defendants Laguna 2, LLC (“L2”) and Joel Blank (“Mr. Blank,” and together with L2, the “L2 

Defendants,” and collectively with the Cali Defendants, the “Defendants”) in the above-captioned 

Action. 

I. INTRODUCTION 

The Court should deny Defendants’ Motions to Dismiss in their entirety because they are 

procedurally defective and also substantively meritless. There is no reason to exercise discretion 

to consider these Motions because the Defendants have previously moved to dismiss without this 

first sale doctrine argument, and in any event, the Court has already considered and rejected the 

first sale doctrine argument in its prior TRO order. In establishing this law of the case, the Court 

previously ruled that there were two separate bases to reject the first sale doctrine argument that 

Defendants ask the Court to reconsider here: 

1. “[I]f the product is in fact scrap, there is arguably no authorized first sale 

which would render the first sale doctrine inapplicable. Cf. Grateful Palate 

Inc. v. Joshua Tree Imps., LLC, 220 Fed. Appx. 635, 637 (9th Cir. 2007) 

(stating that, “[u]nder the first sale doctrine, the mark holder may ordinarily 

control the initial sale of the product, and a product sold without the 

authorization of the mark holder is generally deemed non-genuine”).” 

February 24, 2017 Order, ECF No. 52, at 3:14-19. 

2. “Furthermore, if the product is in fact scrap, it could well be materially 

different (although L2 disputes this fact) which would also render the first 

sale doctrine inapplicable. See SoftMan Prods. Co. v. Adobe Sys., 171 F. 

Supp. 2d 1075, 1091 (C.D. Cal. 2001) (stating that “[a] materially different 

product is not genuine”); see also Hokto Kinoko Co. v. Concord Farms, 

Inc., 810 F. Supp. 2d 1013, 1025 (C.D. Cal. 2011) (noting that “[m]aterial 

Case 3:17-cv-00079-EMC Document 107 Filed 09/05/17 Page 6 of 30
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2 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

differences can relate to a product’s quality control standards”); Idaho 

Potato Comm’n v. G&T Terminal Pkg., Inc., 425 F.3d 708, 721-22 (9th Cir. 

2005) (stating that “many cases have found a likelihood of confusion where 

a trademark owner was prevented from exercising quality control over the 

merchandise bearing its mark” and that “‘the actual quality of the goods is 

irrelevant’” as “ ‘it is the control of quality that a trademark holder is 

entitled to maintain’”).” Id. at 3:20-4:5. 

The Court’s prior Order therefore shows that Fitbit’s Complaint at the time pled more than 

sufficient factual detail that, if taken as true, would establish there was no authorized first sale and 

that the first sale doctrine is also inapplicable because the products are materially different from 

genuine products. See id. Of course, the Second Amended Complaint just adds further detailed 

factual allegations in support of this conclusion. Indeed, the Court’s first sale doctrine ruling even 

went beyond the bare pleadings, as it was based on significant evidentiary support, from which the 

Court determined that Fitbit had established a “reasonable likelihood of success” on the merits. 

Id. at 3:12. 

Defendants provide no basis for the Court to reconsider this order, but simply reargue the 

same legal points, as if the Court had not considered and rejected them already. They do so 

without seeking leave of Court as required by Local Rule 7-9 and without justifying a departure 

from the law of the case doctrine. In re-hashing their previous arguments, Defendants ignore and 

misconstrue the relevant factual allegations and relevant caselaw, relying instead on patent cases 

that are either inapposite or, like the recent Impression Products case, that merely confirm this 

Court’s prior ruling. Further undermining the merit of their argument, each of these Defendants 

(except Great Value) previously moved to dismiss the Complaint but failed to even assert this 

ground in either Motion (and Defendants Cali and Kelvin also answered in the meantime), making 

the current motions procedurally defective for yet another reason. 

In addition to asking the Court to reconsider their previously-rejected first sale doctrine 

arguments, the Defendants’ Motions take a scattershot approach to challenging the SAC. Like 

their arguments as to the first sale doctrine, Defendants can only construct a plausible argument by 

Case 3:17-cv-00079-EMC Document 107 Filed 09/05/17 Page 7 of 30
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3 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

ignoring or misconstruing the relevant factual allegations and caselaw or by simply not citing any 

law at all.1 None of their arguments remotely establishes a single pleading defect here. 

In short, Defendants’ Motions to Dismiss are both improper under the law and unsupported 

by the allegations of the Second Amended Complaint. As such, the Court should deny both of 

their Motions to Dismiss in their entirety and with prejudice. 

II. RELEVANT FACTUAL ALLEGATIONS 

The relevant factual allegations against the Defendants in the Second Amended Complaint 

are fairly straightforward, even if the allegations and claims have expanded. See Second Amended 

Complaint (“SAC”), ECF No. 92. At its heart, the SAC now details how Defendants fraudulently 

obtained hundreds of thousands of scrap products from Fitbit’s reverse supply chain, by 

representing that they would be destroyed and the raw materials recycled. Instead, the scrap 

products were then placed into counterfeit packaging, often commingled with counterfeit chargers, 

and then resold in competition with genuine Fitbit products through online distribution channels, 

like Groupon and eBay, and in brick-and-mortar stores, like Fry’s. See id., ¶¶1-11. 

A. The Scrap Products Were Not “Sold” To BCS 

While the BCS Defendants were only recently added, the story truly starts with them.2

 In 

 

1

 The Cali Defendants in particular strangely question why Fitbit did not broadly quote their 

documents in Fitbit’s Second Amended Complaint. See Motion to Dismiss, ECF No. 99, at 3:4-9. 

The reason, of course, is that doing so could have been construed as a violation of the Stipulated 

Protective Order, given that the Cali Defendants designated all of their documents Highly 

Confidential pursuant to the Stipulated Protective Order (some of which have been downgraded to 

Confidential following a formal request by Fitbit). See Declaration of Zachary J. Alinder in 

Support of Opposition to Motions to Dismiss (“Alinder Decl.”), filed concurrently with this 

Opposition, ¶2. Indeed, Fitbit’s counsel met and conferred with Cali’s counsel prior to filing the 

Second Amended Complaint to ensure that Cali did not object to Fitbit including certain key facts 

from their documents in the Second Amended Complaint, and in doing so, assured Cali’s counsel 

that it would endeavor not to quote from their documents directly. See Alinder Decl., ¶3. If their 

assertions and easy willingness to publicly file their own Confidential-designated document show 

anything, it is that the Cali Defendants have improperly over-designated their documents pursuant 

to the Stipulated Protective Order. 

2

 BCS Defendants here includes Defendants P-Cove Enterprises Inc. dba Buyers Consultation 

(footnote continued) 

Case 3:17-cv-00079-EMC Document 107 Filed 09/05/17 Page 8 of 30
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4 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

mid-2015, Fitbit engaged a scrap destruction vendor, called BCS, to provide global scrap 

destruction and recycling services in support of Fitbit’s reverse supply chain. See id., ¶¶46-50. 

Contrary to Defendants’ claims, Fitbit did not sell any products to BCS, but rather engaged BCS 

as a services vendor in its supply chain to break down these scrap products into raw materials and 

to either properly destroy and dispose of them, or to the extent possible, recycle recoverable raw 

materials. See id. BCS was to then use any money recouped from recycling these raw materials to 

offset the cost of the scrap destruction services they were engaged to provide, and to the extent the 

services were net positive, to split the proceeds with Fitbit. See id. Thus, BCS was a trusted 

services provider within Fitbit’s reverse logistics supply chain, not a customer somehow 

purchasing these scrap products. See id. “Under no circumstances was BCS entitled to resell the 

scrap ‘Fitbit’ products that it received through Fitbit’s reverse supply chain.” Id., ¶50. Consistent 

with this, BCS represented over and over to Fitbit that they were not reselling any of the scrap 

products entrusted to them. See id., ¶¶48-62. As such, there was no authorization or intent by 

Fitbit to “sell” or otherwise introduce these scrap products into the stream of commerce 

whatsoever. See id., ¶¶1-3 & 46-50. 

B. The Scrap Product Shipments Were Materially Different 

Furthermore, as alleged in detail, these scrap products were, and are, “materially different” 

from genuine Fitbit products for a variety of reasons, not the least of which is that Fitbit’s reverse 

supply chain had determined that they should be sent for scrap destruction rather than 

refurbishment. See, e.g., id., ¶¶45, 63-65, & 84. In addition, the scrap products from Defendants 

were shipped in counterfeit packaging and many of the scrap products were packaged with 

counterfeit charging cables. See id., ¶¶1-8, 63 & 81. As further alleged in the SAC, certain of the 

scrap products also had “obvious physical defects and changes,” including having been defaced to 

remove the Serial Number, MAC address label, and other identifying, regulatory and/or 

 

Service (“BCS”), Environmental Liquidation, Inc. (“ELI”), Jonathan Manhan (“Mr. Manhan”), 

and Francis Michael Baker aka Mike Baker (“Mr. Baker”). 

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5 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

compliance information. See id., ¶¶64 & 72.3 Further confirming the counterfeit and materiallydifferent, non-genuine nature of the shipments of scrap products and related accessories/packaging 

sold by Defendants, at least two known shipments have been seized in the last year by United 

States Customs, after certain Defendants attempted to “refurbish” them in Mexico and reimport 

them into California. See id., ¶¶8-9 & 73. Finally, as alleged in the SAC, the misleading and 

inferior warranty and support for these scrap products also constituted a material difference 

between these scrap product sales and genuine Fitbit product sales. See id., ¶¶85-87. 

C. The Cali Defendants’ Relevant Unlawful Conduct 

As the SAC sets forth in detail, Fitbit has also now learned through the Cali Defendants’ 

documents that BCS was defrauding Fitbit from the start, using the above representations about its 

purported recycling and destruction program to obtain Fitbit’s scrap products under false 

pretenses. See id., ¶53. And from the start BCS and the Cali Defendants engaged in a profit share 

from the resale of the fraudulently obtained Fitbit scrap. See id., ¶55. 

As Fitbit has alleged in more detail in the SAC, due to this close coordination between 

BCS and Cali, the Cali Defendants were well aware of the fraud being committed against Fitbit, 

“establish[ing] either an express agreement or at least a tacit understanding of the common plan 

and design to defraud Fitbit, after which Cali and Kelvin dutifully performed their role of 

receiving, processing, and reselling the fraudulently obtained scrap ‘Fitbit’ products.” Id., ¶60. 

Here are some key allegations from the SAC regarding the Cali Defendants’ unlawful conduct and 

their knowledge and agreement to engage in the fraud with BCS: 

 The Cali Defendants coordinated with BCS on the fraudulent settlement statements 

that BCS was sending to Fitbit, purporting to prove to Fitbit how many tons of raw 

materials (e.g. plastic, rubber, steel, glass) had been recycled through the scrap 

 

3

 In making its motion for a TRO, Fitbit also made an evidentiary showing that certain scrap 

designated “Fitbit” products sold by Defendants themselves were physically, materially different 

from genuine Fitbit products, including due to cosmetic defects, as well as damage to the bands or 

buttons. See, e.g., Fitbit’s Supplemental Memorandum In Support of TRO, ECF No. 28, at 3:15-

4:28. 

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6 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

destruction process. Id., ¶¶54-56. Of course, “all or substantially all of the raw 

materials listed on these [settlement statements] were not recycled at all, but rather 

were still part of the scrap ‘Fitbit’ products later resold by Cali.” Id., ¶54. As such 

the Cali Defendants “knew or should have known that BCS was defrauding Fitbit 

and representing to Fitbit that the scrap products were being recycled and/or 

destroyed, when they were actually being resold by Defendants Cali and Kelvin.” 

Id., ¶56. 

 The coordination between BCS and the Cali Defendants on the falsely submitted 

Settlement reports to Fitbit was necessary due to the profit sharing arrangement 

between the two companies, i.e. the fake amounts reported as being recouped from 

recycling raw materials were treated as a cost to be deducted from the revenue that 

they actually made from reselling the scrap products, and thus split between BCS 

and the Cali Defendants. Id., ¶¶55-56. Thus, the Cali Defendants plainly knew or 

should have known that BCS was submitting false settlement reports with false 

recycling/destruction certifications to Fitbit. See id. Further confirming the Cali 

Defendants’ knowledge of the underlying scheme, Cali paid a commission directly 

to Mike Baker, even though he was a BCS employee, for his role in putting 

together the fraud scheme. Id., ¶55. 

 In September 2016, faced with direct questions from Fitbit about a legal inquiry 

into the recycling and destruction of the scrap products, BCS looped in the Cali 

Defendants on an email from Fitbit. Id., ¶57-60. This was not some innocuous 

email, as the Cali Defendants argue. See Cali Defendants’ Motion to Dismiss, ECF 

No. 99, at 2-3 and Ex. 1.4

 In this email, Fitbit’s reverse logistics manager asks for 

“some details” from the BCS Defendants because she has a “meeting with [Fitbit] 

 

4

 The Cali Defendants do not request judicial notice of this email string, however, Fitbit has no 

objection to it, as it helps further establish the Cali Defendants’ collusion in the fraudulent scheme 

with BCS. 

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7 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

legal tomorrow in regards to our scrap process.” Id., Ex. 1 at p.3. Defendant Baker 

then asks his boss, Defendant Manhan, how best to lie to Fitbit about “[w]hich 

company’s [sic] do we want to tell her” to further conceal the fact that they are 

actually selling these scrap products directly to the Cali Defendants. Id. Defendant 

Manhan then forwards this to Defendant Kelvin, saying “See below,” thus ensuring 

that Defendant Kelvin has been made aware that Fitbit is asking legal questions and 

that BCS is going to need to further lie to Fitbit to conceal the fact that the products 

were actually being sent to the Cali Defendants. Id. And of course, that is exactly 

what occurred, as BCS continued to fraudulently conceal the scheme, representing 

to Fitbit the next day: 

1) “Cardboard Recycled by paper mill. Plastic is sent to plastics recycler 

who then shreds, cleans, and makes new plastic...Charging cable and 

dongles are separated and sent to ferrous and Nonferrous recycler for metal 

and copper and gold content. Our downstream processes and resells to end 

users that buy Copper, steel and gold (precious metals)..... Bands are 

shredded then sold to downstream that makes soles for sandals and other 

types of shoes. The brain/tracker is sold to Dowa and a [sic] other down 

streams as e-waste.” Id., ¶58. 

2) And further representing the following day: “Charging cables and 

dongles Are separated[.] Chargers sold by the lbs to metal recycling down 

stream for copper ( base Metal) the down stream processes and resells to 

manufactures [sic] that buy copper. Dongles – are processed at smelter for 

Gold and for the ferrous metal(steel). The smelter will resell the gold and 

steel to manufactures [sic] to manufacture new items that use this 

material[.] Wrist bands – we shred wrist bands without tracker. We then 

resell shredded wrist band material to down stream that will manufacture 

soles for Sandals and Mats[.]” Id., ¶59. 

 Further confirming the Cali Defendants’ volitional conduct in support of the fraud 

being perpetrated on Fitbit, the Cali Defendants later attempted to help conceal the 

fraud by falsely representing a few months later that the “Fitbit goods provided by 

us to L2...are obtained legitimately through legal sources. We are not at liberty to 

provide our supply chain but we would never, ever, purchase from a supplier that 

did not have the legal right to sell to us.” Id., ¶61. This representation was also 

made in context of the Cali Defendants at least knowing the communications 

above, which being generous directly contradict the representation made. 

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8 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

 The Cali Defendants made similar false representations and attempts to conceal the 

scheme to CBP “attempting to convince [CBP] to release a large counterfeit and/or 

otherwise non-genuine shipment of ‘Fitbit’ products seized at the border earlier this 

year.” Id., ¶8; see also Cali Defendants’ Answer and Counterclaims, ECF No. 78, 

p. 10:8-10 (alleging that the Cali Defendants “did everything possible to prove the 

legitimacy of the seized items” in their communications with CBP). Indeed, the 

Cali Defendants made these false representations, even though “there was no 

mistaking the scrap nature and origin of these products, as they were designated as 

scrap in the shipping records and on the pallets themselves.” Id., ¶63. 

In short, through allegations like those above, the SAC more than adequately alleges that 

“Defendant Cali and Kelvin’s coordination with Defendants BCS, Manhan, and Baker in 

communicating with Fitbit, as well as their profit share with Defendants BCS and Manhan on the 

resale of the scrap as alleged above, establishes either an express agreement or at least a tacit 

understanding of the common plan and design to defraud Fitbit, after which Defendants Cali and 

Kelvin dutifully performed their role of receiving, processing, and reselling the fraudulently 

obtained scrap ‘Fitbit’ products.” SAC, ¶60. 

After the Cali Defendants received these scrap products from BCS, Fitbit’s SAC alleges 

that the Cali Defendants sent them to an industrial facility in Tijuana, Mexico for some sort of 

processing, after which the Cali Defendants “placed [them] into counterfeit packaging” along with 

“counterfeit charging cables” and resold them under the guise that such products were “like new” 

and merely “refurbished.” Id., ¶¶1 & 63-66. In addition to reselling directly to unwitting 

consumers, the Cali Defendants “arranged to resell the scrap “Fitbit” products and counterfeit 

packaging/accessories through various third party and online distribution channels.” Id., ¶65. 

D. Defendant Great Value 

“Among these distribution channels was a related sister company, called Great Value, 

LLC,” apparently set up by Defendant Cali’s outside general counsel. Id., ¶66. “Great Value 

resold thousands of these scrap Flex, Surge, Charge, and Charge HR products in counterfeit 

packaging and at least some with counterfeit and/or otherwise non-genuine charging cables and 

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9 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

accessories.” Id. “Great Value appears to have been focused on reselling these scrap ‘Fitbit’ 

products into the Canadian market.” Id. “Further, confirming the direct relationship between 

Defendants Cali and Great Value, Great Value used the same business address as Defendant Cali’s 

dba Buy Now Factory Direct in reselling the scrap ‘Fitbit’ products into Canada.” Id.

E. The L2 Defendants 

 “[O]ne of the main distribution channels for Defendants Cali and Kelvin was Defendant 

L2, acting through Defendant Blank and other L2 employees.” Id., ¶67. Thus, and even though 

Fitbit had previously put them on notice in 2015 (id., ¶75), the L2 Defendants were the ones Fitbit 

ultimately caught in late-2016 reselling these fraudulently obtained and materially different scrap 

“Fitbit” products on established online “e-commerce distribution channels, such as eBay.com, 

Groupon.com, and Woot.com.” Id., ¶¶1 & 76-84. “Prior to filing its original complaint, Fitbit 

confirmed through numerous purchases of the purportedly ‘refurbished’ Fitbit products sold by 

Defendants L2 and Blank through their Established Distribution Channels that they were selling 

non-genuine and otherwise infringing ‘Fitbit’ products, including in counterfeit packaging mocked 

up to resemble genuine Fitbit return replacement packaging.” Id., ¶78. “In addition, many of the 

cables and accessories included with the shipments purchased and received from Defendants L2 

and Blank turned out to be counterfeit and/or non-genuine products that attempted to colorably 

imitate or copy genuine Fitbit cables/accessories and the Fitbit Marks.” Id.; see also id., ¶81 

(comparison photographs of the counterfeit packaging used by the L2 Defendants and allegedly 

created by the Cali Defendants). The L2 Defendants also sold these products with a misleading 

and inferior warranty that unlawfully suggested an affiliation with Fitbit. Id., ¶¶85-87. The L2 

Defendants also copied Fitbit copyrighted images in their online advertising and marketing, 

further “impl[ying] an affiliation and/or endorsement from Fitbit in a manner that was likely to 

confuse consumers.” Id., ¶89.5

 

5

 As alleged in the SAC, Fitbit was in the process of formally registering a selection of the many 

copyrighted images infringed by Defendants at the time of the filing of the SAC. SAC, p.30 at 

n.3. Fitbit has since already received a number of these registrations back from the Copyright 

(footnote continued) 

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10 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

“Not only are consumers likely to be confused by Defendants’ use of the Fitbit Marks, 

images, and misleading advertising and warranty, but Fitbit has found significant evidence of 

actual consumer confusion and brand/reputational harm to Fitbit from consumers who have 

recently complained about the products sold by Defendants.” Id., ¶90. These unlawful sales 

therefore not only damaged Fitbit, but also caused irreparable harm to Fitbit’s brand and 

reputation. Id., ¶¶91-94. 

The above factual allegations in the SAC more than sufficiently allege the Cali 

Defendants’ (including Great Value) and L2 Defendants’ liability on each of the claims alleged by 

Fitbit for their unlawful conduct in relation to the scheme to resell fraudulently-obtained, nongenuine, counterfeit, and otherwise infringing products with counterfeit and otherwise infringing 

packaging and cables, as well as liability of Defendants Cali and Kelvin for conspiring with the 

BCS Defendants to defraud Fitbit. See SAC, ¶¶ 98-153. 

III. RELEVANT PROCEDURAL BACKGROUND 

A. The TRO Briefing and Court Order on the First Sale Doctrine 

On January 11, 2017, Fitbit filed a motion seeking a temporary restraining order and 

preliminary injunctive relief. See Fitbit’s Motion for TRO, ECF No. 12. On January 13, 2017, the 

L2 Defendants filed an Opposition to the TRO Motion based in part on the same first sale doctrine 

arguments made in the current Motions to Dismiss. See ECF No. 18 at p. 1 & 7-8 (“Trademarks, 

like patents and copyrights are limited by the doctrine of first sale.”). Following the Court’s initial 

order granting in part and deferring in part Fitbit’s Motion for TRO, ECF No. 24, Fitbit then 

provided further supplemental briefing including specifically to rebut the first sale doctrine 

argument made by the L2 Defendants. ECF No. 28 at pp. 5-10. In response, the L2 Defendants 

provided a responsive supplemental brief with even more argument on these same first sale 

 

Office. See, e.g., Registration Numbers VA0002063236, VA0002063238, and VA0002063235 

for the copyrighted images shown in Paragraph 89 of the SAC, available at 

http://cocatalog.loc.gov/cgibin/Pwebrecon.cgi?Search_Arg=Fitbit&Search_Code=NALL&PID=y7oXdP1GFCvdqSsM1Y_fpugp1&SEQ=20170829180722&CNT=25&HIST=1. 

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11 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

doctrine issues, again arguing that the “first sale doctrine applies” to the scrap “Fitbit” products 

they bought from the Cali Defendants and resold. ECF No. 32 at pp. 7-9.

Following some additional supplemental briefing (ECF Nos. 46 & 50), and hearings on 

February 2nd (ECF No. 41) and 23rd (ECF No. 51), the Court granted Fitbit’s motion, seeking to 

convert the TRO into a preliminary injunction as to further sales of scrap “Fitbit” products. 

February 24, 2017 Order, ECF No. 52, at pp. 2-4. In granting this relief, the Court specifically 

addressed the first sale doctrine arguments made by the L2 Defendants:

Relief is appropriate because there are serious questions going to the merits – 

indeed a reasonable likelihood of success – and the balance of hardships tips 

sharply in Fitbit's favor. 

More specifically, there are serious questions going to the merits, particularly to the 

extent L2 is selling scrap product, because, if the product is in fact scrap, there is 

arguably no authorized first sale which would render the first sale doctrine 

inapplicable. Cf. Grateful Palate Inc. v. Joshua Tree Imps., LLC, 220 Fed. Appx. 

635, 637 (9th Cir. 2007) (stating that, “[u]nder the first sale doctrine, the mark 

holder may ordinarily control the initial sale of the product, and a product sold 

without the authorization of the mark holder is generally deemed non-genuine”). 

Furthermore, if the product is in fact scrap, it could well be materially different 

(although L2 disputes this fact) which would also render the first sale doctrine 

inapplicable. See SoftMan Prods. Co. v. Adobe Sys., 171 F. Supp. 2d 1075, 1091 

(C.D. Cal. 2001) (stating that “[a] materially different product is not genuine”); see 

also Hokto Kinoko Co. v. Concord Farms, Inc., 810 F. Supp. 2d 1013, 1025 (C.D. 

Cal. 2011) (noting that “[m]aterial differences can relate to a product’s quality 

control standards”); Idaho Potato Comm’n v. G&T Terminal Pkg., Inc., 425 F.3d 

708, 721-22 (9th Cir. 2005) (stating that “many cases have found a likelihood of 

confusion where a trademark owner was prevented from exercising quality control 

over the merchandise bearing its mark” and that “‘the actual quality of the goods is 

irrelevant’” as “‘it is the control of quality that a trademark holder is entitled to 

maintain’”). 

Id. at 3:11-4:5.

Neither the L2 Defendants, nor the Cali Defendants, have sought formal reconsideration of 

this Order, and it constitutes law of the case here. 

B. The L2 Defendants’ First Motion to Dismiss 

On February 9, 2017, the L2 Defendants filed a Motion to Dismiss or Transfer, arguing 

only that the Court should dismiss or transfer the Action in favor an Action pending in the District 

of New Jersey pursuant to the first to file doctrine. See L2 Motion to Dismiss or Transfer, ECF 

Nos. 42-43. Even though the L2 Defendants had already filed motion briefing on the first sale 

doctrine issue, as set forth above, this Motion to Dismiss did not include first sale doctrine 

Case 3:17-cv-00079-EMC Document 107 Filed 09/05/17 Page 16 of 30
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12 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

arguments. See id. On June 8, 2017, after the Court in the District of New Jersey dismissed that 

Action for lack of personal jurisdiction, this Court denied the L2 Defendants’ first Motion to 

Dismiss as moot. See Civil Minutes, ECF No. 85. 

C. The Cali Defendants’ First Motion to Dismiss and Answer 

On April 4, 2017, the Cali Defendants filed a Motion to Dismiss on two grounds. See Cali 

Defendants’ Motion to Dismiss, ECF Nos. 62-63. First, the Cali Defendants argued that, under 

Rule 12(b)(6), the First Amended Complaint (“FAC”) did not allege sufficient facts to state a 

claim against Defendant Kelvin personally. See Notice of Motion to Dismiss, ECF No. 62, at 2:6-

8. Second, they argued that, under Rule 12(e), the factual allegations against Defendant Kelvin 

were too vague. See id. at 2:8-10. The Cali Defendants did not challenge the Complaint on first 

sale doctrine grounds, even though the allegations supporting Fitbit’s Lanham Act trademark 

infringement and counterfeiting claims have not fundamentally changed. See id. On April 26, 

2017, the Court denied the Cali Defendants’ Motion to Dismiss. ECF No. 76. 

Following denial of the Cali Defendants’ Motion to Dismiss, they answered and 

counterclaimed on May 9, 2017. ECF No. 78. 

Despite the prior motions and answer, both the L2 Defendants and Cali Defendants filed 

the instant Motions to Dismiss on August 21, 2017, primarily to reargue the first sale doctrine 

issues previously decided by the Court. See ECF Nos. 99-101. 

IV. LEGAL STANDARDS ON A MOTION TO DISMISS 

Standard Under Rule 12(b)(6). In considering a motion to dismiss a Complaint for 

failure to state a claim, the Court accepts as true all material allegations in the Complaint and 

construes those allegations in the light most favorable to the plaintiff. See Knievel v. ESPN, 393 

F.3d 1068, 1072 (9th Cir. 2005). “Detailed factual allegations” are not required, but the 

“complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is 

plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 

570). Thus, “a complaint should not be dismissed for failure to state a claim unless it appears 

beyond doubt that the plaintiff can prove no set of facts in support of his claim that would entitle 

him to relief.” Conley v. Gibson, 355 U.S. 41, 45-46 (1957). 

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13 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

Standard for Leave to Amend. Finally, to the extent that a Court dismisses a complaint 

or claim, leave to amend generally is granted, unless further amendment would be futile. See

Lopez v. Smith 203 F.3d 1122, 1127 (9th Cir. 2000). 

V. DEFENDANTS’ MOTIONS TO DISMISS FAIL AS A MATTER OF LAW AND 

BASED ON THE FACTS ALLEGED IN THE AMENDED COMPLAINT 

The Court should deny the Defendants’ Motions to Dismiss in their entirety and with 

prejudice because they both are procedurally improper, untimely, and also misinterpret or ignore 

the applicable law as well as the factual allegations actually made in the SAC. 

A. Both Motions Are Procedurally Improper And Untimely 

Rules 12(g) and 12(h) set forth limitations on successive motions to dismiss, like those 

brought by Defendants. See Fed. R. Civ. Proc. 12(g) & (h). “[U]nder Rule 12(g)(2) and Rule 

12(h)(2), a party that seeks to assert a defense that was available but omitted from an earlier Rule 

12 motion can only do so in a pleading, a Rule 12(c) motion, or at trial.” Northstar Fin. Advisors, 

Inc. v. Schwab Investments, 135 F. Supp. 3d 1059, 1070 (N.D. Cal. 2015) (declining to consider 

previously un-asserted defense on successive motion to dismiss). Thus, “where the complaint is 

amended after the defendant has filed a Rule 12(b) motion, the defendant may not thereafter file a 

second Rule 12(b) motion asserting objections or defenses that could have been asserted in the 

first motion.” Id. (citations omitted). While courts may excuse a technical violation like this 

where doing so advances judicial economy, it makes no sense to do so where, like here, “judicial 

economy does not favor an exercise of discretion....” F.T.C. v. Wellness Support Network, Inc., 

2011 WL 4026867, *3 (N.D. Cal. Sept 12, 2011) (denying motion to dismiss as untimely under 

Rule 12(g)). 

Defendants both previously brought pre-answer motions to dismiss, and indeed, the Cali 

Defendants previously answered the Complaint. See Sections III.B and C. above. As such, there 

is certainly a technical violation of Rule 12 here. In addition, the Court should not excuse these 

violations in the interest of judicial economy for at least two reasons. The first is that their 

primary arguments seek reconsideration of first sale doctrine issues that the Court previously 

decided in the context of the earlier TRO briefing, which suggests that these motions were filed 

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14 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

for delay. As discussed further below, the only relevant distinction now is that the standard on a 

motion to dismiss is much more favorable to Fitbit, as it only needs to plausibly allege a claim for 

relief in contrast to the much higher burden that it already met in seeking, and receiving, 

temporary and preliminary injunctive relief. The second is that these motions seek to challenge 

factual issues, e.g. whether the scrap products were materially different, which not proper on a 

pleading motion in any event. See Wellness Support Network, 2011 WL 4026867 at *3 (declining 

to exercise discretion to consider “fact questions that are properly addressed at the summary 

judgment stage of the case and not on the pleadings.”) As such, other than the newly-added 

fraudulent conspiracy allegations, the Court should deny the motions as procedurally improper and 

untimely under Rules 12(g) and (h).6

B. The Court Should Reject Defendants’ Request To Reconsider Its Prior Ruling 

On The First Sale Doctrine, And It Is Inapplicable Here In Any Event 

The primary relief sought in both Motions to Dismiss is a thinly-veiled motion for 

reconsideration of first sale doctrine arguments that the Court rejected months ago in the course of 

the initial TRO and Preliminary Injunction briefing. See Cali Defendants’ Motion to Dismiss at 

pp. 6-10 & L2 Defendants’ Motion to Dismiss at pp. 5-9; see also Section III.A. above. 

Defendants failed to seek leave to file a motion for reconsideration as required by Civil L.R. 7-9 

and also have not shown good cause for the Court to deviate from the law of the case. Indeed, the 

only relevant factual change from the Court’s prior order on the first sale doctrine issues is that 

Fitbit has now uncovered, and alleged, many more facts establishing that there was no authorized 

first sale and that the scrap products were materially different from genuine Fitbit products. 

Further, the only relevant legal change is that the posture of these pleadings motions requires the 

Court to accept all of Fitbit’s factual allegations as true, a far lower burden than the TRO standard 

already met by Fitbit. The Court should deny Defendants’ Motions to Dismiss premised on the 

 

6

 Though Defendant Great Value has not previously brought a motion to dismiss, it is directly 

related to the Cali Defendants who have done so, and as discussed further below, their motion 

does not make any independent arguments related to Great Value and indeed barely even mentions 

Great Value at all. See Section V.D. below. 

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15 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

first sale doctrine argument for at least three reasons. 

First, the Court already considered and rejected the applicability of these same arguments 

to the facts alleged here, and that ruling is now law of the case. See Section III.A. above. “[A] 

court is generally precluded from reconsidering an issue that has already been decided by the same 

court, or a higher court in the identical case.” Thomas v. Bible, 983 F.2d 152, 154 (9th Cir. 1993); 

see also Arizona v. California, 460 U.S. 605, 618 (1983) decision supplemented, 466 U.S. 144 

(1984) (“when a court decides upon a rule of law, that decision should continue to govern the 

same issues in subsequent stages in the same case”). While there are specific grounds under 

which Courts may reconsider such law of the case, none are present here and indeed Defendants 

do not argue any such grounds. See Cali Defendants’ Motion to Dismiss at pp. 6-10 & L2 

Defendants’ Motion to Dismiss at pp. 5-9. As such, Defendants’ Motions fail to “present[] the 

type of ‘extraordinary circumstances’ required to revisit an earlier ruling.” Opperman v. Path, 

Inc., 2014 WL 246972 (N.D. Cal. Jan. 22, 2014).7

 

Second, the Court’s prior ruling on the first sale doctrine issues was, and is still, correct as 

a matter of law. As a preliminary matter, the scrap “Fitbit” products are not subject to the first 

sale doctrine as a matter of law because, as Fitbit has alleged, there was no authorized first sale. 

See Grateful Palate Inc. v. Joshua Tree Imps., LLC, 220 Fed. Appx. 635, 637 (9th Cir. 2007) (stating 

that, “[u]nder the first sale doctrine, the mark holder may ordinarily control the initial sale of the 

product, and a product sold without the authorization of the mark holder is generally deemed nongenuine”); see Section II.A. above (setting forth the allegations negating any authorized first sale 

here). Without an authorized first sale, the first sale doctrine is simply inapplicable. See id.; see also 

Liz Claiborne, Inc. v. Mademoiselle Knitwear, Inc., 979 F.Supp. 224, 230 (S.D.N.Y. 1997) (“The 

question of whether a good is genuine [for first sale doctrine purposes], however, presupposes the 

 

7

 Defendants also neither sought leave to file a motion for reconsideration, as required by Civil 

L.R. 7-9(a), nor did they argue that the grounds for reconsideration required by Civil L.R. 7-9(b) 

have been met. They also failed to avoid repetition of arguments, as required by Civil L.R. 7-9(c). 

This further highlights the lack of extraordinary circumstances here that might possibly justify 

reconsideration of Defendants’ rehashed first sale doctrine arguments. 

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16 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

initial sale was authorized.”); see also Microban Products Co. v. API Indus., Inc., 2014 WL 

1856471, *9-14 (S.D.N.Y May 8, 2014) (granting motion for summary judgment and permanent 

injunction because, among other things, there was no authorized first sale); see also FURminator, 

Inc. v. Kirk Weaver Enterprises, Inc., 545 F.Supp.2d 685, 689-91 (N.D. Ohio April 7, 2008) 

(“Goods are not genuine goods until their sale is authorized by the trademark owner.”). 

The RFA Brands and FURminator cases are directly on point and also held that the first 

sale doctrine did not apply. RFA Brands, LLC v. Beauvais, 2014 WL 7780975 (E.D. Mich., Dec. 

23, 2014), report and recommendation adopted (E.D. Mich., Feb. 9, 2015, No. 13-14615) 2015 

WL 519166; FURminator, Inc. v. Kirk Weaver Enterprises, Inc., 545 F.Supp.2d 685 (N.D. Ohio 

April 7, 2008). In RFA Brands, the plaintiffs (the manufacturer and seller of electronic products) 

filed suit for trademark infringement against a defendant that was selling products bearing 

plaintiffs’ trademarks where “the majority of the products had come from the returns section of the 

warehouse. For example, many of the products bore various retailer stickers, and some of the 

goods showed indications of having been opened and improper packaging.” 2015 WL 519166, at 

*2-3. Like Fitbit, the RFA Brands plaintiffs had implemented a quality control process that 

prohibited the sale of returned goods, prohibited the sale of refurbished goods, and typically 

destroyed returned goods. See id. “Plaintiffs assert that the products being sold by defendant do 

not meet plaintiffs’ quality and customer service standards, and plaintiffs’ never authorized those 

products to be re-sold to the public.” Id. at *4. Because the defendant could not establish that the 

sales of the products at issue were “authorized,” the Court concluded that the first sale doctrine did 

not apply. Id. 

Likewise, in FURminator, FURminator determined that certain of its tools “did not meet 

its quality control standards and decided that it would not authorize these tools for sale.” 

FURminator, 545 F.Supp.2d at 690. “To keep these tools from entering the marketplace, 

FURminator undertook to implement their disposal, paying Willimantic to destroy the tools.” Id. 

Instead, Willimantic sold them without FURminator’s knowledge to intermediaries, which ended 

up eventually selling them to the Defendants. Id. at *687-88. The Defendants then resold them at 

discounted prices online and at flea markets. Id. The Court granted partial summary judgment on 

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17 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

the Lanham Act claim, including because the first sale doctrine did not apply, as there was no 

authorized first sale and the products were materially different. Id. at *690-92. As the Court held, 

to “permit” defendants to avoid summary judgment under such circumstances “would put 

trademark holders and the good will of their products, names and reputations in substantial 

jeopardy, while serving no useful purpose, other than to enrich persons who, like defendants, seek 

to profit from the malfeasance of an intermediary.” Id. at *692. 

So it should be here. The first sale doctrine does not apply to the scrap “Fitbit” branded 

products sold by Defendants because, as Fitbit has alleged in detail, Fitbit did not sell them to its 

scrap destruction vendor, nor authorize that vendor to resell them under any circumstances. See

Section II.A. above. Indeed, the legal principle articulated in the FURminator and RFA Brands

cases applies as strongly or more so in Fitbit’s case, because Fitbit now knows, and has alleged, 

that the scrap destruction vendor in its reverse supply chain obtained these scrap products through 

fraud. In short, “fraudulently obtained” scrap products that were “unlawfully diverted” from 

Fitbit’s reverse supply chain simply do not meet the threshold requirement of having an authorized 

first sale. SAC, ¶¶1-3 & 46-50. 

The cases cited by Defendants in support of their first sale doctrine arguments either 

support Fitbit on this point or are distinguishable. See Cali Defendants’ Motion to Dismiss at pp. 

6-10 & L2 Defendants’ Motion to Dismiss at pp. 5-9. As the Supreme Court stated in the recent 

Impression Products case, cited by Defendants, the first sale doctrine still requires an authorized 

sale: “[t]he limit functions automatically: When a patentee chooses to sell an item, that product ‘is 

no longer within the limits of the monopoly’ and instead becomes the ‘private, individual 

property’ of the purchaser, with the rights and benefits that come along with ownership.” 

Impression Prods. v. Lexmark Int’l, Inc., __ U.S. __, 137 S.Ct. 1523, 1531 (2017) (emphasis 

supplied).8 The reason is that the authorized sale is the point where “patent rights yield to the 

 

8

 While the Impression Products case does not support Defendants, it also is easily distinguishable 

on the facts. In that case, Lexmark made an authorized first sale of the printer cartridges, which 

Impression Products then merely bought as used and empty, refilled, and resold. See id. The facts 

(footnote continued) 

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18 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

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& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

common law principle against restraints on alienation.” Id. at 1532. As the Court further 

explained: “[O]nce a patentee sells an item, it has ‘enjoyed all the rights secured’ by that limited 

monopoly. [Citation omitted]. Because ‘the purpose of the patent law is fulfilled ... when the 

patentee has received his reward for the use of his invention,’ that law furnishes ‘no basis for 

restraining the use and enjoyment of the thing sold.’” Id. (emphasis supplied) (citations omitted). 

In contrast, where the owner has been defrauded out of an item, like here, rather than through an 

authorized sale, the purpose of the first sale doctrine would not be fulfilled, because the owner has 

not enjoyed all the rights secured by its intellectual property and has not received its “reward.” 

See id.; see also Chaffee v. Boston Belting Co., 63 U.S. 217 (1859) (holding that where defendants 

could not show they “legally acquired [] title” and otherwise “failed to establish any right or 

license to use their machinery...they appear in the record as naked infringers.”); see also

FURminator, 545 F.Supp.2d at 689-91 (“[D]efendants’ cases are inapplicable where, as here, the 

initial sale of the trademarked product was not authorized.”) 

The Supreme Court made this distinction even more clear in its discussion of the General 

Talking Pictures case. See Impression Products, 137 S.Ct. at 1535 (citing and quoting General 

Talking Pictures Corp. v. Western Elec. Co., 305 U.S. 124, 127 (1938)). As the Court noted, the 

General Talking Pictures case involved a “fundamentally different” situation than the Impression 

Products case and “stands for the modest principle that, if a patentee has not given authority for a 

licensee to make a sale, that sale cannot exhaust the patentee’s rights.” Id. at 1535. By extension, 

a product obtained through false pretenses, like here, is “fundamentally different” from the 

products in the Impression Products case, and because there was no authorized sale, there was no 

trigger to exhaust Fitbit’s rights under the first sale doctrine. Thus, to the extent it is relevant here 

at all, the Impression Products case supports Fitbit and the Court’s prior ruling on the first sale 

doctrine. See id. 

Defendants’ other cited cases are no more helpful to them. The majority of their cases are 

 

could not be more different from this case, where the products in question were not sold by the 

trademark holder, but rather were obtained through false pretenses. 

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19 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

generic first sale doctrine cases, mostly patent based, which, like Impression Products, merely 

support the requirement that an authorized first sale must occur. See Cali Defendants’ Motion to 

Dismiss at pp. 6-10 (citing Mallinckrodt, Jazz Photo, Repeat-o-Type, Kirtsaeng, Impression 

Products, and Sebastian) & L2 Defendants’ Motion to Dismiss at pp. 5-9 (citing Impression 

Products, McCoy, McCarthy, Sebastian, NEC, and Debnicare). For example, Defendants make 

much of the Sebastian Products case, but it stands for the unremarkable proposition that the first 

sale doctrine applies where a reseller does nothing more than “stock and resell genuine 

[trademarked] products lawfully acquired on the open market under the true [] trademark—the 

precise conduct excluded from the Lanham Act by the ‘first sale’ rule.” Sebastian Intern., Inc. v. 

Longs Drug Stores Corp., 53 F.3d 1073, 1077 (9th Cir. 1995). That is a far cry from the facts 

here, where the scrap “Fitbit” products were not sold, but were fraudulently obtained, and were 

among other things altered, re-packaged, and resold using counterfeit marks. See Sections II.A. & 

B. above. 

The unpublished Analog Devices case is similarly distinguishable as the Ninth Circuit 

merely affirmed denial of a preliminary injunction where the Plaintiff “made no effort to ensure 

the [products] were destroyed; [plaintiff] had not requested certificates of destruction since 1991; 

and [plaintiff] sold the chips to [defendant] fully marked with the same trademark appearing on 

chips that had passed its quality control tests.” Analog Devices v. West Pac. Indus., 152 F.3d 923, 

*2-3 (9th Cir. 1998). In contrast, Fitbit did not sell the scrap products to its scrap destruction 

vendor, made significant efforts to ensure the scrap products were destroyed, and requested and 

received fraudulent certificates of destruction from its scrap destruction vendor. See SAC, ¶¶1-3 

& 46-62. 

The out-of-circuit stolen goods case – McCarthy v. Fuller, 2013 U.S. Dist. LEXIS 162826 

(S.D. Ind. Nov. 15, 2013) cited by the L2 Defendants at p. 7:26-27 – is both unpersuasive and 

easily distinguishable. In that case, the Court found that the resale of religious medallions was 

protected by the first sale doctrine even if they were “stolen or otherwise obtained illegally” 

because the medallions were genuine and consumers would not be confused about the source or 

quality of the goods. Id. The McCarthy court did not discuss or analyze the contradictory caselaw 

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20 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

above, requiring an authorized first sale to occur. See id. Instead, the Court focused only on the 

fact that there was no consumer confusion about source or quality because the goods were genuine 

religious medallions. See id. Not surprisingly, the likelihood of consumer confusion relating to 

resale of scrap “connected health and fitness wearable products and associated mobile applications 

and online resources” with substantial related counterfeit issues is exponentially greater than from 

the resale of genuine religious medallions. SAC, ¶4. Moreover, as discussed in more detail 

below, the scrap “Fitbit” products sold by Defendants are not “genuine” due to material 

differences in the products, packaging, quality control, and warranties. Further, Fitbit alleged not 

only a likelihood of consumer confusion here, but actual consumer confusion as well, as a result of 

Defendants’ deceptive resale of the scrap “Fitbit” products with counterfeit packaging and cables 

(and misleading warranty), as “like new” refurbished goods. SAC, ¶¶ 1, 3, 6 & 88-94. As such, 

McCarthy is inapposite at best. 

Third, none of the patent or other first sale doctrine cases cited by Defendants purport to 

address or remotely affect the settled federal law, relied on by the Court in its prior ruling, that 

material differences in the products also render the first sale doctrine inapplicable. See, e.g.,

Grateful Palate, Inc. v. Joshua Tree Imports, LLC, 220 Fed.Appx. 635, 637 (9th Cir. 2007) 

(“After that first sale, however, the trademark holder may establish infringement only if he 

demonstrates that the goods are materially different.”); see also SoftMan Products Co., LLC v. 

Adobe Sys., Inc., 171 F. Supp. 2d 1075, 1092 (C.D. Cal. 2001) (“The first sale doctrine does not 

apply, however, when an alleged infringer sells trademarked goods that are materially different 

than those sold by the trademark owner.”); see also Rolex Watch USA, Inc. v. Agarwal, 2012 WL 

12886444 (C.D. Cal. 2012) (denying motion to dismiss trademark infringement claims brought 

against Rolex watch refurbisher/reseller, including because “[t]he first sale doctrine is inapplicable 

when the resold product is materially different from the originally sold product.”) (quoting 

Beltronics USA, Inc. v. Midwest Inventory Distribution, LLC, 562 F.3d 1067, 1076 (10th Cir. 

2009)). Here, Fitbit has more than adequately pled material differences between the scrap 

products sold by Defendants in counterfeit packaging, with counterfeit cables, with misleading 

and substandard warranties, and in violation of Fitbit’s quality control standards. See Section II.B. 

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21 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

above; see also Idaho Potato Comm’n v. G&T Terminal Pkg., Inc., 425 F.3d 708, 721-22 (9th Cir. 

2005) (stating that “many cases have found a likelihood of confusion where a trademark owner was 

prevented from exercising quality control over the merchandise bearing its mark” and that “the actual 

quality of the goods is irrelevant” as “it is the control of quality that a trademark holder is entitled to 

maintain”). As such, Defendants’ Motions to Dismiss as to the first sale doctrine fail as a matter of 

law on this basis as well. 

In short, the Court’s prior ruling on the first sale doctrine was correctly decided, it is the 

law of the case, and Defendants have provided nothing in their Motions that remotely warrants 

anything more than a flat denial of their Motions on this ground. 

C. Defendants’ Remaining Grab-Bag Of Arguments All Fail To Raise Any 

Pleading Defect Here 

The remainder of the Motions to Dismiss brought by Defendants similarly miss the mark. 

The additional arguments relying on their first sale doctrine argument fail for the reasons set forth 

above. Their challenges to Fitbit’s remaining causes of action on other grounds meanwhile are 

based on ignoring the applicable law and the actual alleged facts. 

1. Fitbit’s Complaint States A Claim Against Defendants Cali and Kelvin 

for Conspiracy to Defraud 

The Cali Defendants first argue that Fitbit has not alleged sufficient facts about their 

agreement to the conspiracy to defraud, while failing to cite or quote the actual legal requirements 

of the claim. See Cali Defendants Motion to Dismiss at p.1-2. The reason is because the actual 

legal standard does not help them.

The actual legal standard under the Wasco case that they cite is that “the complaint must 

allege (1) the formation and operation of the conspiracy, (2) the wrongful act or acts done pursuant 

thereto, and (3) the damage resulting from such act or acts.” Transamerica Life Ins. Co. v. Jurin, 

2014 WL 3519205, *6 (N.D. Cal. July 16, 2014) (citing Wasco Prods., Inc. v. Southwall Techs., 

Inc., 435 F.3d 989, 992 (9th Cir. 2006)). 

The Cali Defendants primarily challenge the conspiracy's formation, arguing that there are 

not sufficient allegations of an express agreement here. See Cali Defendants’ Motion to Dismiss 

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22 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

at pp. 1-5. Defendants ignore both the law and Fitbit’s actual allegations, where Fitbit has alleged 

over and again how Defendants Cali and Kelvin knew or should have known about the fraud (see

Section II.C. above), and that “Defendant Cali and Kelvin’s coordination with Defendants BCS, 

Manhan, and Baker in communicating with Fitbit, as well as their profit share with Defendants 

BCS and Manhan on the resale of the scrap as alleged above, establishes either an express 

agreement or at least a tacit understanding of the common plan and design to defraud Fitbit, after 

which Defendants Cali and Kelvin dutifully performed their role of receiving, processing, and 

reselling the fraudulently obtained scrap ‘Fitbit’ products.” SAC, ¶60. 

Fitbit’s pleading is robust given that this is a conspiracy case prior to substantial discovery, 

and not surprisingly, California law supports these allegations as being more than sufficient. 

Indeed, California does not require an “express agreement” for civil conspiracy, only “a tacit 

understanding.” In re Sunset Bay Assocs., 944 F.2d 1503, 1517 (9th Cir. 1991). Under California 

law, “[t]he existence of a conspiracy may sometimes be inferred from the nature of the acts done, 

the relations of the parties, the interests of the alleged conspirators, and other circumstances.” 

Transamerica Life Ins. Co. v. Jurin, 2014 WL 3519205, *6 (quoting Ally Bank v. Castle, 11–CV–

896 YGR, 2012 WL 3627631, at *10 (N.D. Cal. Aug. 20, 2012); see also Facebook, Inc. v. 

MaxBounty, Inc., 5:10–CV–04712–JF HRL, 2011 WL 4346514, at *4 (N.D. Cal. Sept. 14, 2011) 

(“To state a claim for conspiracy, [plaintiff] must plead “an agreement to participate in an 

unlawful overt act that is performed in furtherance of an agreement. The existence of this 

agreement may be either express or inferred from a defendant’s conduct.”). “The conspiracy 

allegation serves to establish liability of defendants who agreed to defraud the plaintiff, regardless 

of whether they were direct participants in the wrongful acts.” Transamerica Life Ins. Co. v. Jurin, 

2014 WL 3519205, *6 (citing Ally Bank, 2012 WL 3627631, at *10 and 5 Witkin, Cal. Pro.

(2008) Pleading, § 921 at p. 335)). 

As established above, Fitbit has alleged that the Cali Defendants entered into either an 

explicit or tacit agreement with the BCS Defendants to defraud Fitbit. See Section II.C. above. It 

is “difficult to imagine anyone creating [multiple] corporate entities, maintaining them at the same 

few addresses...and commingling funds [with the co-conspirator], for any reason other than to 

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23 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

further a conspiracy.” Ally Bank at *10. Indeed, the facts alleged here are far more detailed 

regarding the conspiracy than those that were found sufficient in the Transamerica and Ally Bank

cases cited above. Moreover, the conspiracy pleading standard under California law is not strict, 

as the Cali Defendants appear to argue. As established above, “the existence of a conspiracy ‘may 

sometimes be inferred from the nature of the acts done, the relations of the parties, the interests of 

the alleged conspirators, and other circumstances.’ ” In re Sunset Bay Assocs., 944 F.2d at 1517 

(quoting Greenwood v. Mooradian, 137 Cal. App. 2d 532, 538 (1955)). Fitbit’s allegations that 

(a) the Cali Defendants and BCS agreed to a profit share to split the proceeds from the conspiracy 

after the fact, (b) the co-conspirators coordinated on the settlement statements sent to Fitbit 

showing the raw materials fraudulently reported to Fitbit as having been recycled, (c) they 

coordinated on Fitbit’s legal questions regarding the scrap destruction process and therefore the 

Cali Defendants knew BCS was lying to Fitbit about disposal of the scrap products, and (d) the 

Cali Defendants’ attempted to conceal and cover for the BCS Defendants after the conspiracy 

began to unravel, are more than sufficient to meet the conspiracy standard under California law. 

See Section II. above; see also Transamerica at *6; Ally Bank at *10. 

To the extent that the Cali Defendants challenge their wrongful acts done in furtherance of 

the conspiracy, Fitbit has multiple sections of the Complaint detailing those wrongful acts. See

Section II. above. The Cali Defendants’ primary argument appears to be using the word 

“scintilla” liberally, however, doing so simply exposes the weakness of their argument and does 

nothing to change the allegations in the actual complaint, which detail their actions in support of 

the conspiracy to defraud Fitbit. See id.; see also Cali Defendants’ Motion to Dismiss at p.2. The 

Cali Defendants nowhere appear to challenge the damage caused to Fitbit. Accordingly, each of 

the Cali Defendants’ arguments seeking to undermine the conspiracy allegations fails. The Court 

should therefore reject their challenge Fitbit’s claims against Defendants Cali and Kelvin for 

conspiracy to defraud. 

2. Fitbit’s Complaint States A Claim Against Defendants for 

Counterfeiting 

The Cali Defendants and L2 Defendants to some extent appear to challenge the sufficiency 

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24 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

of Fitbit’s pleading regarding Defendants’ resale of counterfeit cables and packaging with 

counterfeit marks. See Cali Defendants’ Motion to Dismiss at pp. 11-12 and L2 Defendants’ 

Motion to Dismiss at 10. While Defendants’ argument on this point is vague, Fitbit’s allegations 

are specific and clear. See SAC, ¶¶81-84 & 98-105. Indeed, among other allegations, Fitbit even 

provided exemplar photographs of Defendants’ packaging with the counterfeit marks in the SAC. 

SAC, ¶81. And, in seeking the TRO in this matter, Fitbit also provided photographs of counterfeit 

cables packaged and shipped by Defendants with these scrap “Fitbit” products. See ECF No. 50-6 

(Exhibit E to Bonham Declaration). Regardless, Fitbit has more than sufficiently alleged that 

Defendants violated the Lanham Act’s prohibitions against counterfeiting, by among other things, 

creating, purchasing, and/or reselling packaging and cables with counterfeit marks in violation of 

the Lanham Act. See, e.g., SAC, ¶¶81-84 & 98-105. The Court should therefore deny this portion 

of Defendants’ Motions as well.9

3. The Cali Defendants’ Vague Catch-All Argument Fails As Well 

Finally, the Court should reject the Cali Defendants’ attempt to sweep all of the other 

claims in the SAC up in their challenges above to Fitbit’s trademark allegations. See Cali 

Defendants’ Motion to Dismiss at p. 12. While the challenges to the trademark-based claims fail 

for all the reasons set forth above, the Cali Defendants also fail to make any substantive argument 

on Fitbit’s other claims, even though the elements for federal unfair competition, trademark 

dilution, and state unfair competition are distinct from a claim for trademark infringement. The 

Cali Defendants do not explain how the first sale doctrine argument could possibly have such a 

preclusive effect, and it is inapplicable here as established above. Thus, the Cali Defendants 

concede that those claims are sufficiently pled, whereas here, the first sale doctrine does not apply. 

D. The Cali Defendants Do Not Assert Any Separate Or Distinct Basis To 

Challenge The SAC On Behalf Of Defendant Great Value 

Although the Cali Defendants’ Motion to Dismiss purports to have been filed on behalf of 

 

9

 The L2 Defendants do not make any other challenges to the SAC other than based on the first 

sale doctrine and the counterfeiting allegations. See generally L2 Defendants’ Motion to Dismiss. 

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25 Case No. 3:17-cv-00079-EMC

PLAINTIFF FITBIT, INC.’S OPPOSITION TO MOTIONS TO DISMISS 

LAW OFFICES 

SIDEMAN

& BANCROFT LLP 

ONE EMBARCADERO CENTER, 22ND FLOOR 

SAN FRANCISCO, CALIFORNIA 94111-3711 

Defendant Great Value, it does not make any independent arguments in support of the motion on 

behalf of Great Value. Indeed, the Cali Defendants appear to only reference allegations about 

Great Value on p. 12, vaguely criticizing that it is not clear if their sales were to consumers or to 

resellers. This nitpick deserves no response, as it does not impact the sufficiency of the pleading 

here. In any event, Great Value knows who it resold to, and knows full well, as alleged, that it 

resold counterfeit and otherwise infringing “Fitbit” branded products, packaging and cables in 

violation of the Lanham Act and other laws. See SAC, ¶¶17 & 63-66.

VI. CONCLUSION 

For the foregoing reasons, Fitbit respectfully requests that the Court deny the Cali 

Defendants’ Motion to Dismiss and the L2 Defendants’ Motion to Dismiss in their entirety and 

with prejudice. 

DATED: September 5, 2017 SIDEMAN & BANCROFT LLP 

 By: /s/ Zachary J. Alinder 

 Zachary J. Alinder 

Attorneys for Plaintiff 

FITBIT, INC. 

3346821 

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