N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT
M ONSTER

ENER GY C O M PANY, a De la ware c o rpora tion, Pla i ntiff-Appe lla

nt,
v. INTEGR ATED SUPPLY NETW ORK, LLC , a Florida lim ite d lia

bility c om pa ny , De fe nda n t-Appe l le e . No. 19-55760 D.C . No. 5:17-c v-00548-C B M -R

AO
M EM O R ANDUM *

M ONSTER

ENER GY C O M PANY, a De la ware c o rpora tion, Pla i ntiff-Appe lle e , v. INTEGR ATED SUPPLY NETW ORK, LLC , a Florida lim ite d lia

bility c om pa ny , De fe nda n t-Appe l la

nt. No. 19-55800

D.C . No. 5:17-c v-00548-C B M -R

AO

Appe a l from

the Unite d

Stat e s Distric t C ourt for the C e ntra l Distric t of C a lifornia 

# F IL ED JUL 22 2020 M OLLY C. DW Y ER, CLERK U

. S. CO URT O F APPEALS

* This disposition is not a ppropria te for public a t ion a

nd is not pre c e de nt e xc e pt a s provide d

by Ninth C irc uit R

ule 36-3.C onsue lo B . M arsha ll, Distric t Judge , Pre siding Argue d a nd Subm itte d July

8, 2020 Se a ttle , W a s hington B e fore : FER

NANDEZ a

nd NGUYEN, C irc uit Judge s, a nd B O LTON, ** Distric t Judge
. Pla intiff M onste r Ene rgy C om pa ny (M E C ) brought this infringe m e nt a c tion
a ga inst De fe nda

nt Inte gra te d

Supply Ne twork, LLC (ISN) unde r the fe de ra l Lanha m Ac t 1 and C a lifornia

la w. 2 The jury

de te rm ine d tha

t ISN ha d infringe d
som e of M EC ’ s m arks a

nd its tra de dre ss, tha

t the infringe m e nt wa s not willful,
and tha t M EC ha d prove n $0 in a c tua l da m a ge s but wa s e ntitle d to $5,000,000 in punitive dam a g e s. The distric t c ourt de nie d M EC ’ s m otion for a pe rm ane nt injunc tion unde r the La

nha m Ac t, 3 dism isse d its C a l ifornia Unfa ir C om

pe tition Law 4 (UC L) c la im , a

warde d M EC $1 in nomi na l da m a ge s, a nd othe rwise de nie d the p artie s’ post-tria l m otions. M EC a ppe a ls, a nd ISN c ross-a

ppe a ls, a num be r of

* * The Honora

ble Susa n R . B olton, Unite d State s Distric t Judge for the Distric t of Ariz ona , sitting by de signa tion. 1 Se e 15 U.S.C . §§ 1114(1), 1125(a ). 2 Se e C a l. B us. & Prof. C ode § 17200; Los De fe nsore s , Inc . v . Gome

z , 166 C a l. R

ptr. 3d 899, 912 (C t. App. 2014). 3 Se e 15 U.S.C . § 1116(a ). 4 Se e C a l. B us. & Prof. C ode §§ 17200, 17203. 2the d istric t c o urt’ s de c isions in Nos. 19-55760 a n d 19-55800, re spe c tive ly . W e
a ffirm in pa rt, va c a te in pa

rt, a nd re m a nd. No. 19-55760 (1) M EC argue s tha

t the distric t c ourt a

b use d its disc re tion 5 in de ny ing its
m otion for a

pe rm an e nt injunc tion pursua nt to the Lanha

m Ac t on the ground tha

t M EC ha d not de m onstra

te d a c tua l irre pa

ra ble ha rm 6 from ISN’ s infringe m e nt. W e disa gre e . Eve n

if M EC a dduc e d e vide nc e of a strong busine ss re puta

tion a nd goodwill a

ttributa b l e to its m arks a

nd tra de dre ss, the distric t c ourt a c te d within its disc re tion in finding tha

t M EC did not show tha

t ISN’ s infringe m e nt wa s inflic ting
a c tua l, irre pa

ra ble ha rm on thosea sse ts. Se e adidas Am., Inc . v . Sk e c he rs USA, Inc
. , 890 F.3d 747, 752, 759–61 (9th C ir. 2018); se ealso Ande rson v . C i ty of Be sse m e r C ity , 470 U.S. 564, 573–74, 105 S. C t. 1504, 1511, 84 L. Ed. 2d 518 (1985); c f. adidas , 890 F.3d a

t 752, 756–57. (2) M EC argue s tha

t the distric t c ourt e rre d in dismissing its C a lifornia UC L
c la im for la c k of sta

nding. Se e C a l . B us. & Prof. C ode § 17204; K w ik se t C o rp. v . Supe rior C

ourt , 246 P.3d 877, 885–86 (C a l . 2011). W e a g re e . Wh ile M EC ha d to

5 e Bay Inc . v . Me rc

E x c h ange , LLC , 547 U.S. 388, 391, 126 S. Ct. 1837, 1839, 164 L. Ed. 2d 641 (2006); se e also United State s v . Hink son , 585 F.3d 1247, 1261–62 (9th C ir. 2009) (e n ba nc ). 6 He rb Re e d Ente r

s., LLC v . Fla. Entm’t Mgmt., Inc

. , 736 F.3d 1239, 1249 (9th C ir. 2013). 3de m onstra

te an e c o nom ic injury

in orde r to ha

ve UC L sta

nding, it only

ne e de d to show “ the qua

ntum of lost m one y

or prope rty

ne c e ssa ry . . . to e sta

blish injury

in fa c t ” unde r fe de ra l la

w. K w ik se t , 246 P.3d a

t 886; se e also id. a t 885. Thejury de te rm i ne d tha

t ISN infringe d

M EC ’ s tra de m arks a

nd tra de dre s s, whic h is itse lf a
c ogniz a ble injury
. Se e Alre ady

, LLC v . N ik e , Inc
. , 568 U.S. 85, 91–92, 133 S. Ct. 721, 727, 184 L. Ed. 2d 553 (2013); Halic k i Films, LLC

v . Sande rson Sale

s & Mk t g. , 547 F.3d 1213, 1225–26 (9th C ir. 2008); se e also Lujan v . De fs. of W ildlife , 504 U.S. 555, 560, 578, 112 S. C t. 2130, 2136, 2145, 119 L. Ed. 2d 351 (1992). That injury

is e c onom ic for UC L purpose s be c a use ISN’ s infringe m e nt de prive d M EC of the e xc lusive use of “ prope rty to whic h [it] . . . ha s a

c ogniz a ble c la im .” K w i k se t , 246 P.3d a

t 885–86; se e Hamilton-Brow n Shoe C o. v . W o lf Bros. &

C o. , 240 U.S. 251, 259, 36 S. C t. 269, 272, 60 L. Ed. 629 (1916); se e also C oll. Sav

. Bank v . Fla. Pre

paid Postse c ondary

Educ . Ex pe nse Bd. , 527 U.S. 666, 673, 119 S. C t. 2219, 2224, 144 L. Ed. 2d 605 (1999). Thus, we va c a te the sta

nding de c ision
and re m and for a

de c i sion on the

m e rits of the UC L c la im
. 7

7 The distric t c ourt should c onside r the e ffe c t, if a ny , of Sonne r v . Pre mie r N

utrition C orp. , 962 F.3d 1072, 1081 (9th C ir. 2020).

4(3) M EC argue s tha t the distric t c ourt a

b use d its disc re tion 8 in de ny ing M EC ’ s m otion for a

ne w tria l on a c tua l da

m a ge s on the ground tha

t the jury ’ s $0 dam a ge s ve rdic t wa s unsupporte d by the e vide nc e . W e disa gre e . The ve rdic t
re fle c t s the jury ’ s de te rm ination tha t M EC fa ile d to c arry

its burde n of proving the
am ount of da

m a ge s, if a

ny . Inte l C

orp. v . Te raby te Int’l, Inc

. , 6 F.3d 614, 620–21 (9th C ir. 1993); Phillipine N at’l Oil C o. v . Garre tt C

orp. , 724 F.2d 803, 806 (9th C ir. 1984); se e also Guy

v . C i ty of San Die

go , 608 F.3d 582, 588 (9th C ir. 2010). Any te nsion be twe e n the jury ’ s punitive and a c tua l da

m a g e s awards doe s not le a d to the c onc lusion tha

t the a c tua l da

m a ge s ve rdic t ha d no re a sona ble ba sis. Se e Molsk i , 481 F.3d a

t 729. Thedistric t c ourt did not a buse its disc re tion in de ny ing M EC ’ s m otion for a

ne w tria l on a c tua l da

m a ge s. (4) At the tim e of tria l, we re quire d willfulne ss a s a pre c o ndition to a disgorge m e nt a

ward unde r the La

nha m Ac t. Stone

C re e k , Inc . v . Omnia Italian De sign, Inc
. , 875 F.3d 426, 441 (9th C ir. 2017). M EC argue s tha t R omag Faste n e r s, Inc . v . Fossil, Inc

. , __ U.S. __, __, 140 S. C t. 1492, 1495–97, 206 L. Ed. 2d 672 (2020), ha s fata lly unde rm ine d tha

t princ iple
. Se e Mille r v . Gammie , 335 F.3d 889, 900 (9th C ir. 2003) (e n ba nc ). W e e xe rc ise our disc re tion to c onside r

8 Se e Molsk

i v
. M.J
. C able , Inc
. , 481 F.3d 724, 728 (9th C ir. 2007); se e also Hink son , 585 F.3d a

t 1261–62. 5this que stion, 9 an d we a gre e tha

t the Supre m e C ourt ha s squa re ly re j e c te d the
re a s oning tha

t m otiva te d Stone C

re e k
. Se e Romag Faste ne rs , __ U.S. a t __, 140 S. C t. at 1495–97. Thus, we re m and to thedistric t c ourt to de c ide whe the r disgorge m e nt of profits is a ppropria te in the c irc um sta

nc e s of this c a se . Se e id. a t __, 140 S. C t . at 1497. No. 19-55800 (5) Se ve ra l of ISN’ s a ssignm e nts of e rror are e sse n tia lly a lte rna tive fa c e ts of its the ory tha t M EC fa i le d to de m onstra te tha t it wa s injure d by

ISN. First, a s de sc ribe d a

bove at (2), the infringe m e nt ve rdic t itse lf c onstitute s a c ogniz a ble injury in fa c t . Thus, we re

je c t ISN’ s a

rgum e nt tha

t M EC la c k e d

c onstitutiona

l sta nding to pursue

its c la im s . 1 0 Se c ond, ISN wa s not e ntitle d to judgm e nt a s a
m a tte r of la

w on M EC ’ s infringe m e nt c l a im s be c a use the showing re quire d to de m onstra

te a La nha m Ac t viola tion c annot be c o nflat e d with theshowing re quire d to re c ove r dam a g e s for tha t viola tion. Se e 15 U.S.C . § 1117(a ); Brook fie ld C ommc ’ns, Inc . v . W

. C oast Entm’t C

orp. , 174 F.3d 1036, 1046 (9th C i r. 1999); Inte l C orp. , 6 F.3d a

t 620–21. Third, the

distric t c ourt did not err in re fusing to use

9 Dre am Palac e v . C ounty of Maric opa , 384 F.3d 990, 1005 (9th C ir. 2004). 1 0 W e a l so re

je c t ISN’ s im

plic it a s sum

ption tha t sta nding e va porate s if a pla i ntiff lose s on the m e rits. Se e Ste e l C o. v . C itize ns for a Be tte r Env ’t , 523 U.S. 83, 89, 118 S. C t . 1003, 1010, 140 L. Ed. 2d 210 (1998). 6injury

and c a u sation jury

instruc tions a

nd ve rdic t-form

que stions tha

t we re pre d ic a te d on ISN’ s m i sunde rsta nding of theshowing re quire d for a Lanham

Ac t viola tion. Se e C

le m v . Lome l i , 566 F.3d 1177, 1180–81 (9th C ir. 2009). (6) The distric t c ourt did not a buse its disc re tion in e x c luding e vide n c e tha t M EC ’ s e n e rgy

drinks c a use ha rm to som e c onsum e rs. While the e v i de nc e m ay have ha d som e slight re le va n c e , the distric t c ourt prope rly e xc lude d it on theba sis that it pla inly c arrie d a

substa ntia l risk of unfa ir pre

judic e . Se e Unite d State

s v . W iggan , 700 F.3d 1204, 1213 (9th C ir. 2012); se e also Fe d. R . Evid. 401, 403. (7) The distric t c ourt e rre d in re fusing to va c a t e the punitive dam a ge s
award 1 1 ba se d on M EC ’ s C a lifornia c om m on la w c la im . B e c a

u se “ a c tua l da

m a ge s
are a n a bsolute pre dic a te for an

award of e x e m

pla ry or punitivedam a g e s” in C a lifornia and the jury

awarde d $0 in a c tua l da

m a g e s, the punitivedam a ge s a ward should ha ve be e n va c a te d
. K

ize r v . C ounty of San Mate o , 806 P.2d 1353, 1357 (C a l. 1991); se e C

he ung v . Dale

y , 42 C a l. R

ptr. 2d 164, 167 (C t. App. 1995); se e also C oste risan v . Te

jon Ranc h C

o. , 62 C a l. R

ptr. 800, 802–03 (C t . App. 1967). M ore o ve r, a lthough a

n a ward of nom i na l da

m a g e s m a y be m andatory

in a 42

1 1 Se e C a l. C iv. C ode § 3294(a ). 7U.S.C . § 1983 a c tion in some c irc um sta nc e s, 1 2 the distric t c ourt e rre d in ove rriding the j ury ’ s $0 da

m a ge s ve rdic t

and a warding $1 in nom

ina l da m a ge s in this c a se . Se e W e i Zhang v . Am. Ge m Se a

foods, Inc

. , 339 F.3d 1020, 1038 (9th C ir. 2003); C oste r isan , 62 C a l. R

ptr. a t 802–03. W e va c a te the nom ina l a nd punitive

dam a ge s
awards, a nd we re m an d

so tha t the distric t

c ourt c a n c onside r whe the r the punitive dam a ge s should bere insta te d, in wholeor in pa

rt, a fte r the UC L a

nd La nha m Ac t disgorge m e nt c la im s a

re de c ide d. (8) W e va c at e the attorne y ’ s fe e s a nd c osts a wards a n d re m an d for
re c o nside ra tion a fte r the distric t c ourt ha s de c ide d the othe r m a tte rs on re m and. AFFIRM E D IN PART , V ACAT E D IN PART , AND RE M ANDE D for furthe r proc e e dings not inc onsiste nt with this disposition. The pa rtie s sha ll be ar the i r own c osts on a

ppe a l.

1 2 Se e Hazle

v . C rofoot , 727 F.3d 983, 991 n.6, 992 (9th C ir. 2013); Floy d v . Law

s , 929 F.2d 1390, 1401–02 (9th C ir. 1991). 8