Opinion
Case No. 2:11–cv–00417–MMD–CWH.
2012-09-25
JL BEVERAGE COMPANY, LLC, Plaintiff, v. BEAM, INC. et al., Defendants.
Chad W. Miller, Ryan R. Gile, Kendelee Leascher–Works, Weide & Miller, Ltd., Las Vegas, NV, A. Todd Merolla, Meroilla & Gold, LLP, Atlanta, GA, for Plaintiff. Michael J. McCue, Jonathan W. Fountain, Lewis & Roca, LLP, Las Vegas, NV, Angela J. Baylin, Claudia W. Stangle, Mark J. Liss, Leydig, Voit & Mayer, Ltd., Chicago, IL, Defendants.
Chad W. Miller, Ryan R. Gile, Kendelee Leascher–Works, Weide & Miller, Ltd., Las Vegas, NV, A. Todd Merolla, Meroilla & Gold, LLP, Atlanta, GA, for Plaintiff. Michael J. McCue, Jonathan W. Fountain, Lewis & Roca, LLP, Las Vegas, NV, Angela J. Baylin, Claudia W. Stangle, Mark J. Liss, Leydig, Voit & Mayer, Ltd., Chicago, IL, Defendants.
ORDER
(Plf.'s Motion for Preliminary Injunction—dkt. no. 36)
MIRANDA M. DU, District Judge.
I. SUMMARY
In this trademark infringement case, Plaintiff JL Beverage Company, LLC (“JL Beverage”) asks the Court to determine that Defendants infringe upon JL Beverage's trademarked “lips IMAGE
The mark on the left, called “Johnny Love Vodka” or the “JLV mark,” is registered with the United States Patent and Trademark Office (“USPTO”) as Registration No. 2,986,519 in International Class 033—Vodka (registered August 16, 2006). The mark on the right is called the “JL Lips Mark,” and is also registered with the USPTO under Registration No. 4,044,182 in International Class 033—Distilled Spirits (registered October 25, 2011). Both IMAGE
The JL Lips mark is imprinted at the top of the bottle and on the back label. The mark on the back label is also colored to correspond to the flavor within the bottle:
IMAGE
Metheny sold the Johnny Love vodkas to Thomas Diab, JL Beverage's current president, in 2005. JL Beverage asserts that the company has spent considerable time, effort, money, and other resources developing and promoting vodkas bearing its two marks.
2. Defendants' Mark
Defendants Beam, Inc. and Jim Beam Brands Co. (collectively, the “Beam Defendants”) own approximately 60 lines of alcoholic beverages. One of these products is a line of flavored vodka called “Pucker Vodka.” The Beam Defendants purchased the Pucker brand from Koninklijke De Kuyper, B.V. (“De Kuyper”) in 2010. Although Pucker is not a new product, in Spring 2010 Defendant Jim Beam wanted to redesign and rebrand Pucker in order to “extend the equity of the Pucker brand and lips into flavored vodka.” To that end, Jim Beam hired the outside design firm of Libby, Perszyk, Kathman, Inc. (“LPK”) to “independently create a unique look and feel for its Pucker vodka product....” (Dkt. no. 42 at 3.) Defendants claim that they wanted LPK to create a marketing campaign that would communicate “intense flavor and intense fun” in connection with its Pucker vodka brand. (Dkt. no. 42 at 3.) As part of this campaign, Defendants and LPK re-branded the Pucker Vodka labels and bottles and developed a new marketing campaign for the brand. The new Pucker Vodka launched in Spring 2011. The bottles contain a prominent lips IMAGE
The Beam Defendants instructed LPK to use both the Pucker name and lips as part of any design it developed for Pucker's new label. (Dkt. no. 46 at ¶ 12.) Notably, previous iterations of Pucker Vodka had used lips IMAGE
JL Beverage uses the JLV mark on bottles of its unflavored vodka.
1. Factor 1: Strength of the Mark
“The more likely a mark is to be remembered and associated in the public mind with the mark's owner, the greater protection the mark is accorded by trademark law.” GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1207 (9th Cir.2000). “The strength of the trademark is evaluated in terms of its conceptual strength and commercial strength.” SunEarth, Inc. v. Sun Earth Solar Power Co., Ltd., 846 F.Supp.2d 1063, 1078 (N.D.Cal.2012). However, “[i]n reverse confusion cases, courts evaluate the conceptual strength of the senior user's mark and compare it to the commercial strength of the junior user's mark.” Moose Creek, Inc. v. Abercrombie & Fitch Co., 331 F.Supp.2d 1214, 1224 (C.D.Cal.2004); see also Dreamwerks Prod. Group, Inc. v. SKG Studio, 142 F.3d 1127, 1130 n. 5 (9th Cir.1998); Playmakers, LLC v. ESPN, Inc., 297 F.Supp.2d 1277, 1281 (W.D.Wash.2003) (“Playmakers I ”), aff'd sub nom. Playmakers LLC v. ESPN, Inc., 376 F.3d 894 (9th Cir.2004) ( “Playmakers II ”). “The ultimate question in a reverse confusion case is whether consumers doing business with the senior user might mistakenly believe that they are dealing with the junior user.” Playmakers II, 376 F.3d at 897 (quotation marks and citation omitted).
Therefore, the Court considers (1) the conceptual strength of the JLV mark, for the purposes of both forward and reverse confusion; (2) the commercial strength of the JLV mark, for the purposes of forward confusion; and (3) the commercial strength of the Pucker Vodka mark, for the purposes of reverse confusion.
a. Conceptual strength of the senior mark
“The conceptual strength of a mark refers to its categorization on the continuum of ‘genericness' to arbitrariness, with arbitrary marks being entitled to the highest degree of protection from infringement.” Playmakers I, 297 F.Supp.2d at 1281. “Generic marks are those that refer to the genus of which the particular product is a species.” One Indus., LLC v. Jim O'Neal Distrib., Inc., 578 F.3d 1154, 1164 (9th Cir.2009) (citing Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768, 112 S.Ct. 2753, 120 L.Ed.2d 615 (1992) (internal quotation marks omitted)). “Descriptive terms directly describe the quality or features of the product.” Brookfield Commc'ns, Inc. v. W. Coast Entm't Corp., 174 F.3d 1036, 1058, n. 19 (9th Cir.1999). “A suggestive mark conveys an impression of a good but requires the exercise of some imagination and perception to reach a conclusion as to the product's nature.” Id. “Finally, arbitrary and fanciful marks have no intrinsic connection to the product with which the mark is used; the former consists of words commonly used in the English language ... whereas the latter are wholly made-up terms.” Id. at 1164 (quotation marks and citation omitted).
Because the JLV mark contains the word “vodka,” the Court determines that the mark is descriptive. It describes the primary feature of the Johnny Love brand product: vodka. In its briefings, JL Beverage focuses not on the entire mark, but solely the lips. JL Beverage argues that “to associate ‘lips' to a bottle of vodka requires great imagination, and therefore” the mark is arbitrary or fanciful. (Dkt. no. 61 at 3.) It is true that the lips portion of the JLV mark is the only part that Defendants could potentially infringe upon; it is the only common feature shared by the two trademarks. However, “under the anti-dissection rule, the validity and distinctiveness of a composite trademark is determined by viewing the trademark as a whole, as it appears in the marketplace.” Official Airline Guides, Inc. v. Goss, 6 F.3d 1385, 1392 (9th Cir.1993). This is because “[w]hether a mark suggests or describes the goods or services of the trademark holder depends, of course, upon what those goods or services are.” Entrepreneur Media, Inc. v. Smith, 279 F.3d 1135, 1142 (9th Cir.2002). JL Beverage uses the JLV mark in commerce as a whole. Although Plaintiff does at times only use the lips portion of the mark in commerce (for example, on the imprint at the top of the bottle cap), JL Beverage owns and has registered the lips mark as a separate trademark.
JL Beverage argues that its mark is conceptually strong because it is registered and has obtained incontestability. (Dkt. no. 36 at n. 1.) However, “an incontestable mark may be sufficiently strong for registration purposes, i.e. not generic, but may still be relatively weak for likelihood of confusion purposes.” Playmakers, 297 F.Supp.2d at 1281. Moreover, though registration “alone may be sufficient in an appropriate case to satisfy a determination of distinctiveness[,] ... while the registration adds something on the scales, [courts] must come to grips with an assessment of the mark itself.” Network Automation, Inc. v. Advanced Sys. Concepts, Inc., 638 F.3d 1137, 1149 (9th Cir.2011).
The Court's conclusion on this point would not differ even were it to examine the conceptual strength of the lips portion of the JLV mark alone. The ‘lips' portion of the mark is not descriptive. It is arbitrary, because it is a symbol in “common linguistic use but which, when used with [vodka], neither suggest[s] nor describe[s] any ingredient, quality or characteristic of those goods or services.” Moose Creek, 331 F.Supp.2d at 1222. Yet “even an arbitrary mark may be classified as weak where there has been extensive third party use of similar marks on similar goods.” Matrix Motor Co., Inc. v. Toyota Jidosha Kabushiki Kaisha, 290 F.Supp.2d 1083, 1091 (C.D.Cal.2003). “This is known as the ‘crowded field’ doctrine.” Moose Creek, 331 F.Supp.2d at 1224 (citation omitted). “In a crowded field of similar marks, each member of the crowd is relatively weak in its ability to prevent use by others in the crowd.” One Indus., 578 F.3d at 1164 (internal quotation marks omitted). “[T]hat the marketplace is replete with products using a particular trademarked word” or symbol “indicates not only the difficulty in avoiding its use but also, and directly, the likelihood that consumers will not be confused by its use.” Entrepreneur Media, Inc. v. Smith, 279 F.3d 1135, 1144 (9th Cir.2002). Defendants provide numerous examples of alcoholic beverages that use lips as trademarks or as part of their trademarks. ( See, e.g., dkt. nos. 47, 49–1, 49–2, 49–4, 49–5, 49–6, 49–7, and 49–8.) These examples include lips marks used on product labels for prepared vodka cocktails, wine, and beer. ( See id.) Plaintiff argues that none of these lips IMAGE
While courts tend to consider the mark as a whole when determining the strength of the mark, sometimes considering the mark's most salient feature is also important. For example, the presumption of inherent distinctiveness that attaches to a mark when it obtains registration without requiring proof of secondary meaning applies to the most salient feature of the mark. See KP Permanent Make–Up, Inc. v. Lasting Impression I, Inc., 408 F.3d 596, 603–604 (9th Cir.2005). Here, because the lips portion of the JLV mark is the mark's most salient feature, and because the only portion of the mark Defendants allegedly infringe upon is the lips, the Court examines the strength of the lips portion of the mark alone.
First, the bottles' shapes are distinct. JL Beverage uses a stock wine bottle in the “Bordeaux-style” with a long neck whereas Defendants use a cylindrical bottle. The bottle caps are markedly different: whereas JL Beverage uses a traditional-style cap, akin to those covering a typical wine bottle, bottles of Pucker are closed with a unique cylindrical, thick plastic colored cap. The cap is colored to correspond to the vodka flavor and also has a grooved wave pattern running diagonally across it.
Second, the product labeling is not similar. Johnny Love's label is silver with minimal wording, a small IMAGE
JL Beverage's lips show only a few lip creases and are more rounded than Defendants', shaped almost like an “o”. Defendants' lips are oval, elongated, have many more creases than JL Beverage's, and are surrounded not by a word, but by colored ink blotches.
Though not as important as the “sight” subfactor in this case, the Court concludes that the two trademarks do not sound the same. JL Beverage asserts that “consumers would verbally describe the marks as ‘lips' given the prominent appearance of the ‘human lips' design for both parties,” and therefore “the sound of Plaintiff's Marks would be identical to the LIPS mark being used by the Beam Defendants.” (Dkt. no. 61 at 6.) But neither product is called “lips” or “lips vodka.” As Defendants correctly point out, consumers would call the products either “Johnny Love” or “Pucker”—two names that sound nothing alike—when asking for the respective vodkas over the phone or at a bar or restaurant. (Dkt. no. 42 at 12.)
4. Factor 4: Evidence of Actual Confusion
JL Beverage provides numerous examples of what it deems to be consumer confusion. For example, on July 15, 2011, a woman named Erin Murphy contacted Shaun Robertson, JL Beverage's North Carolina broker, stating that she saw JL Beverage's new bottle at an ABC Store. (Dkt. no. 36–2 at 5.) The bottle was a bottle of Pucker Vodka. ( Id.) On October 16, 2011, a man named Sam Mills contacted Robertson stating that he purchased Pucker cherry flavored vodka thinking it was Johnny Love Vodka. (Dkt. no. 36–2 at 4.) On February 15, 2011, a man named Michael C. Herring, who identified himself as the Chief Administrator of the North Carolina Alcohol and Beverage Control Commission, emailed Robertson's company about distributing Johnny Love Vodka in North Carolina, and in the email also wrote: “see attached. This is Jim Beam's new line of vodka. Looks a lot like Johnny Love.” (Dkt. no. 36–2 at 7.) JL Beverage provides numerous other similar instances of alleged consumer confusion between the two vodka bottles.
Defendants counter that JL Beverage's proffered evidence of actual confusion is inherently unreliable because it was provided by friends of Plaintiff's employees and its broker and broker's friends. (Dkt. no. 42 at 18.) Because they have a financial interest in the success of the product, broker and distributor opinions about actual confusion are of “little probative value.” Global Mfg. Group, LLC v. Gadget Universe.Com, 417 F.Supp.2d 1161, 1174 (S.D.Cal.2006). And the evidence from friends of JL Beverage employees is likewise of limited weight because “[e]vidence of secondary meaning from a partial source possesses very limited probative value.” Filipino Yellow Pages v. Asian Journal of Publications, Inc., 198 F.3d 1143, 1152 (9th Cir.1999). JL Beverage does not deny that the evidence comes from informal sources familiar with the JL Beverage brand and its employees and contractors.
Defendants also argue that JL Beverage's evidence of actual confusion consists of double, triple, and quadruple hearsay. The record demonstrates that at least some of the examples of alleged consumer confusion involve multiple levels of hearsay. For example, many of the instances of alleged confusion involve Mr. Robertson recounting via email his conversations with various consumers. (Dkt. no. 36–2 at 4); see Japan Telecom, Inc. v. Japan Telecom Am., Inc., 287 F.3d 866, 874 n. 1 (9th Cir.2002) (statements that declarant knows of others who were confused by similar trademarks is inadmissible hearsay).
Finally, some of the alleged evidence of actual confusion includes consumers noting that the two vodkas look alike. For example, Mr. Herring commented that Pucker “looks like” Johnny Love. (Dkt. no. 36–2 at 5.) Such evidence demonstrates lack of confusion because it shows that Mr. Herring understood that Johnny Love and Pucker are distinct products. See, e.g., Duluth News–Tribune v. Mesabi Publishing Co., 84 F.3d 1093, 1098 (8th Cir.1996).
In light of the above, there are several potential problems with the reliability and admissibility of JL Beverage's proffered evidence of actual confusion. Later discovery may strengthen this evidence, but the Court determines that for the purposes of this Motion, factor four weighs in neither party's favor. See Sleekcraft, 599 F.2d at 353 (“Because of the difficulty in garnering” evidence of actual confusion, “the failure to prove instances of actual confusion is not dispositive.”).
5. Factor 5: Marketing Channels Used
“Convergent marketing channels increase the likelihood of confusion.” Groupion, LLC v. Groupon, Inc., 826 F.Supp.2d 1156, 1164 (N.D.Cal.2011) (quotation marks and citations omitted).
JL Beverage argues that the marketing channels used here are identical. Both parties use the 3–tier distribution system for the sale of alcoholic spirits. According to JL Beverage, because “[d]istributors carry scores of different products but are absolutely calculated at balancing their portfolios of diverse products with non-overlapping attributes ...”, the identical channels of trade make it difficult for Johnny Love Vodka to be picked up by distributors. (Dkt. no. 36 at 15; no. 36–1 at ¶¶ 13, 14.) JL Beverage argues that this difficulty is further complicated by the fact that it is easier for companies with other alcoholic products already represented by the distributor to obtain representation for a new line of products than it is for a new company to obtain representation. ( Id.) Here, while Defendants manufacture approximately 60 different lines of alcoholic beverage products, JL Beverage sells only the Johnny Love line of vodka and flavored vodkas. ( Id.)
The “3–tier distribution system” refers to the chain of sale from manufacturer/supplier to wholesale distributor to licensed retail establishment to consumer.
Defendants counter first by arguing that the marketing tactics used by each party are different, but the relevant inquiry involves marketing channels, not marketing tactics. Defendants then argue that even if the marketing channels are identical, Defendants can only be enjoined in the geographic areas where JL Beverage actively sells its vodkas. Defendants invoke the Dawn Donut rule to support their argument:
Under the Dawn Donut rule, even if a federal registrant has rights in a mark, it is not necessarily entitled to an injunction against an unauthorized user: “if the use of the marks by the registrant and the unauthorized user are confined to two sufficiently distinct and geographically separate markets, with no likelihood that the registrant will expand his use into the defendant's market, so that no public confusion is possible, then the registrant is not entitled to enjoin the junior user's use of the mark.” ... Only once the federal registrant has expanded its use of the mark, so that the market areas of the two users are no longer separate and distinct, will the registrant be entitled to an injunction.
Kerzner Int'l Ltd. v. Monarch Casino & Resort, Inc., 675 F.Supp.2d 1029, 1047 (D.Nev.2009) (citing Dawn Donut Co., Inc. v. Hart's Food Stores, Inc., 267 F.2d 358, 364 (2d Cir.1959)). Defendants argue that in light of the Dawn Donut rule, “Plaintiff must show not only that it is actively selling product so as to create consumer recognition of its product, but also where those sales are being made.” (Dkt. no. 42 at 24.) Defendants assert that JL Beverage has not provided evidence that it is actively selling its product in each of Defendants' markets. However, the Dawn Donut rule plainly does not apply to this case. ( Id.) JL Beverage has distributors in 20 states, a Federal Basic Alcohol Permit to sell in all 50 states, and is pursuing expansion of its product line nationally. ( See dkt. no. 62–2.) While there is some evidence that Johnny Love Vodka may not be currently experiencing strong sales, the fact that Johnny Love is sold in at least 20 states and JL Beverage is working towards selling it in all fifty states suffices to make Dawn Donut inapplicable here.
Defendants dispute these facts in their Surreply (dkt. no. 97), arguing that JL Beverage's presence is far more minimal and less geographically diffuse than Diab states. Yet given the undisputed evidence that JL Beverage is at the very least working towards expanding its brand to all fifty states, it cannot be said that there is “ no likelihood ” that the JL Beverage will expand its use into all of Defendants' markets, as required by Dawn Donut. See Kerzner Int'l, 675 F.Supp.2d at 1047 (emphasis added).
JL Beverage has demonstrated that the marketing channels are identical. Moreover, given the nature of the 3–tier distribution market for alcohol, the fact that the marketing channels are identical places JL Beverage at a particularly significant disadvantage. This factor favors JL Beverage.
6. Factor 6: the Type of Good and Degree of Care Likely to be Exercised by the Consumer
“In assessing the likelihood of confusion to the public, the standard used by the courts is the typical buyer exercising ordinary caution.” Sleekcraft, 599 F.2d at 353. What is expected of this reasonably prudent consumer depends on the circumstances:
[w]e expect him [the reasonable consumer] to be 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).
Brookfield, 174 F.3d at 1060.
The parties agree that both Johnny Love and Pucker are “call brands” rather than “well brands,” and that the two drinks fall into the same price category. Johnny Love costs $18.99 while Pucker costs $15.99. This factor therefore weighs in JL Beverage's favor.
Plaintiff explains the difference between “well brands” and “call brands:” “ ‘Well brands' are less expensive liquor brands and are what a bar patron would receive if he or she orders a drink without requesting a specific brand (well brands are usually kept in the “well” of the bar, out of sight). ‘Call brands,’ on the other hand, are the more expensive, higher prestige brands that are typically showcased on the back shelf of a bar and which consumers usually must specifically request (e.g., asking for a Smirnoff screwdriver.”).” (Dkt. no. 36 at 17.)
7. Factor 7: Defendants' Intent in Selecting the Mark
“This factor favors the plaintiff where the alleged infringer adopted his mark with knowledge, actual or constructive, that it was another's trademark.” Brookfield, 174 F.3d at 1059.
In a reverse confusion case, “the intent inquiry must ... focus on whether the defendant was aware of the senior user's use of the mark in question, or whether the defendant conducted an adequate name search for other companies marketing similar goods or services under that mark.” Commerce Nat. Ins. Services, Inc. v. Commerce Ins. Agency, Inc., 214 F.3d 432, 444 (3d Cir.2000).
Here, it is clear that at some point in the development of its Pucker Vodka label, Defendants were at the very least aware of Plaintiff's trademark, and that at least one of Jim Beam's employees was aware of the Johnny Love Vodka brand. However, such knowledge is of little weight in light of the circumstances surrounding Defendants' Pucker Vodka campaign. First, the record demonstrates that Defendants and their predecessors in interest have used different lips IMAGE
Defendants contest the validity of the JL Lips mark, and have petitioned to cancel the mark. (Dkt. no. 32 at ¶¶ 14–25.) However, Defendants do not appear to argue invalidity for the purposes of this Motion.
The Court determines that consumers are unlikely to confuse the JL Lips Mark with Defendants' mark, for largely the same reasons discussed supra in Section IV.A. The JL Lips mark is used on the top of Plaintiff's bottle cap and on the back label.
IMAGE
As alluded to in Section IV(A)(1)(a), the lips image used above is arbitrary. The JL Lips mark, unlike the JLV mark, is therefore conceptually strong. However, the Court's analysis supra regarding the two marks' commercial strength makes factor one favor Defendants here.
Further, factor three weighs in favor of Defendants because there is even greater dissimilarity between the JL Lips mark and the Pucker Vodka trademark than between the JLV mark and Defendants' mark. The two marks are used on different parts of the bottle; the JL Lips mark stands alone while the Pucker lips are part of an intricate and colorful logo; the JL Lips mark appears to be decorative while the Pucker lips are colored to denote a particular flavor. These differences, when added to the differences already discussed supra in Section IV(A)(3), demonstrate that the two lips are not used in a similar fashion. No reasonable consumer would confuse JL Beverage's use of lips imprinted on its bottle cap and in color on the back bottle label with Defendants' use of lips as part of a larger, colorful, busy label that includes Defendants' house name and several other images alongside the lips. For these reasons, and the reasons stated above regarding the JLV mark, the Court determines that JL Beverage is unlikely to succeed on its trademark infringement claims regarding the JL Lips mark.
C. Common Law Trademark Claims
JL Beverage also alleges common law trademark infringement against Defendants. Though not entirely clear from its filings regarding this Motion, it appears as if JL Beverage asserts a common law trademark in its colored lips images and/or its colored labels.
The Sleekcraft analysis here would not significantly differ from the analysis above regarding the JLV registered trademark. JL Beverage's common law marks are conceptually and visually more similar to the Pucker marks than JL Beverage's registered marks because the concept of coloring the lips portion of the label to correspond to the flavor within the bottle is common to both JL Beverage and Pucker Vodka. However, this additional similarity does not tip the scales in JL Beverage's favor, because the marks when viewed as a whole—on their respective labels and bottles—are distinct.
D. Common Law Unfair Competition Claim
“The test for false designation under the Lanham Act, as well as the common-law and statutory unfair competition claims, is whether there was a ‘likelihood of confusion.’ ” Walter v. Mattel, Inc., 210 F.3d 1108, 1111 (9th Cir.2000)holding modified by Surfvivor, 406 F.3d 625 (citations omitted). The Ninth Circuit “has consistently held that state common law claims of unfair competition ... are ‘substantially congruent’ to claims made under the Lanham Act.” Cleary v. News Corp., 30 F.3d 1255, 1262–63 (9th Cir.1994) (citations omitted). Therefore, for reasons stated above regarding JL Beverage's trademark infringement claims, JL Beverage is unlikely to succeed on its common law unfair competition claim.
V. LIKELIHOOD OF IRREPARABLE HARM
To prevail on this Motion, JL Beverage must establish that “remedies available at law, such as monetary damages, are inadequate to compensate for that injury.” eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391, 126 S.Ct. 1837, 164 L.Ed.2d 641 (2006). That is, JL Beverage must establish that the harm caused by Defendants cannot be remedied except through injunctive relief. See MGM Studios, Inc. v. Grokster, Ltd., 518 F.Supp.2d 1197, 1210 (C.D.Cal.2007).
JL Beverage argues that it will suffer irreparable injury to its reputation and goodwill as long as Defendants are “allowed to continue their infringing activities.” (Dkt. no. 61 at 12.) Yet this only holds true if Defendants are in fact engaging in infringing activity—if there is a likelihood that consumers will confuse Johnny Love for Pucker (or vice-versa in the case of forward confusion). But the Court has determined that consumer confusion is unlikely.
Defendants assert that JL Beverage waited more than one year after it learned of the alleged trademark infringement to file its Motion, and that this weighs against irreparable harm. Defendants present evidence that JL Beverage learned of the alleged infringement in February 2011, and Defendants informed JL Beverage that it would not cease using the lips image for its Pucker Vodka in April 2011. JL Beverage filed its original Complaint in March 2011 and served Defendants in July 2011. Yet JL Beverage did not file this Motion until February 23, 2012. “[D]elay before seeking a preliminary injunction implies a lack of urgency and irreparable harm.” Oakland Tribune, Inc. v. Chronicle Pub. Co., Inc., 762 F.2d 1374, 1377 (9th Cir.1985). JL Beverage does not attempt to explain why it delayed bringing this Motion.
Because JL Beverage significantly delayed bringing this Motion and because JL Beverage does not demonstrate that it will incur significant non-monetary harm should this case proceed without preliminarily enjoining Defendants, the Court determines that JL Beverage has not demonstrated likelihood that it will suffer irreparable harm should the Court deny its Motion.
VI. BALANCE OF THE HARDSHIPS
“In each case, a court must balance the competing claims of injury and must consider 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, 542, 107 S.Ct. 1396, 94 L.Ed.2d 542 (1987); see also Int'l Jensen v. Metrosound U.S.A., Inc., 4 F.3d 819, 827 (9th Cir.1993) (“In evaluating the balance of hardships a court must consider the impact granting or denying a motion for a preliminary injunction will have on the respective enterprises.”). An injunction may not issue unless the balance of hardships tips in favor of the moving party. “[A] court must remain free to deny a preliminary injunction, whatever be the showing of likelihood of success, when equity in the light of all the factors so requires.” Apple, Inc. v. Samsung Elecs. Co., Ltd., 877 F.Supp.2d 838, 916 (N.D.Cal.2012).
The Court determines that the balance of the hardships favors Defendants.
JL Beverage argues that it has expended substantial “time, money, and other resources” to develop the goodwill and positive reputation surrounding the JLV marks. (Dkt. no. 36 at 22.) This is no doubt true. But beyond its arguments regarding likelihood of consumer confusion, JL Beverage does not demonstrate why preliminary injunctive relief is necessary to maintain its brand's positive reputation and goodwill.
On the other hand, Defendants argue that they will incur significant hardship were the Court to hold in Plaintiff's favor. Defendants predict that they will have to expend resources selecting a new product design, changing labels, destroying inventory, changing product advertising, and recalling products and promotional materials. (Dkt. no. 42 at 28.) Defendants assert that these steps will harm their business relationships with their suppliers, distributors, and retailers. ( Id.) The Court agrees. This is an instance where “Plaintiff and Defendants have each spent substantial resources developing their marks, but the hardships Plaintiff may suffer if the status quo is maintained are far inferior to those Defendant would endure if it were required to cease further commercial use of its mark....” Credit One Corp. v. Credit One Fin., Inc., 661 F.Supp.2d 1134, 1141 (C.D.Cal.2009).
VII. PUBLIC INTEREST
Courts “must consider the public interest as a factor in balancing the hardships when the public interest may be affected.” Caribbean Marine Servs. Co. v. Baldrige, 844 F.2d 668, 674 (9th Cir.1988). “In the trademark context, courts often define the public interest at stake as the right of the public not to be deceived or confused.” Cytosport v. Vital Pharm., Inc., 617 F.Supp.2d 1051, 1081 (E.D.Cal.2009). Because the Court determines that the public is unlikely to be confused between the JL Beverage's marks and Defendants' marks, the public interest does not weigh in favor of granting Plaintiff's Motion.
VIII. CONCLUSION
IT IS THEREFORE ORDERED that JL Beverage's Motion for Preliminary Injunction (dkt. no. 36) is DENIED.