Opinion
CV. No. 02-948-HA.
August 10, 2004
Christopher L. Garrett, Elizabeth Schwartz, Jay A. Zollinger, Perkins Coie, Sarah J. Crooks, Portland, Oregon, John C. Rawls, Fulbright Jaworski, Los Angeles, California, Attorneys for Plaintiffs.
Kurt M. Rylander, Vancouver, Washington, Attorney for Defendant.
OPINION and ORDER
Before the court are: plaintiffs' motion for Leave to File Supplementation (Doc. #105); defendant's Motion for Summary Judgment (Doc. #53); defendant's Motion to Determine Sufficiency of Discovery Responses (67); and plaintiffs' Motion to Compel (76).
For the following reasons, plaintiffs' motion for Leave to File Supplementation is denied; defendant's Motion for Summary Judgment is granted in part; defendant's Motion to Determine Sufficiency of Discovery Responses is denied as moot; and plaintiffs' Motion to Compel is granted in part.
BACKGROUND
Defendant, Samantha Buck Lundberg owns the Astoria Coffeehouse in Astoria, Oregon. In March 2002, defendant changed the name of the business to "Sambuck's Coffeehouse." Defendant uses the names "sambuck's," "SAMBUCK'S COFFEE HOUSE," and "sambuck's coffeehouse" in association with her business.
Plaintiffs hold several trademarks registered with the United States Patent and Trademark Office that contain the name "STARBUCKS COFFEE" and operate thousands of retail coffee shops across the country under the "Starbucks" mark. Plaintiffs contend that defendant's use of the "Sambuck's" name infringes on and dilutes their registered marks.
STANDARDS
Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). Summary judgment is not proper if material factual issues exist for trial. Warren v. City of Carlsbad, 58 F.3d 439, 441 (9th Cir. 1995).
The moving party has the burden of establishing the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party shows the absence of a genuine issue of material fact, the nonmoving party must go beyond the pleadings and identify facts which show a genuine issue for trial. Id. at 324. Assuming that there has been sufficient time for discovery, summary judgment should be entered against a "party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Id. at 322.
The court must view the evidence in the light most favorable to the nonmoving party. Bell v. Cameron Meadows Land Co., 669 F.2d 1278, 1284 (9th Cir. 1982). All reasonable doubt as to the existence of a genuine issue of fact should be resolved against the moving party. Hector v. Wiens, 533 F.2d 429, 432 (9th Cir. 1976). The inference drawn from the underlying facts must be viewed in the light most favorable to the party opposing the motion. Valadingham v. Bojorquez, 866 F.2d 1135, 1137 (9th Cir. 1989). Where different ultimate inferences may be drawn, summary judgment is inappropriate. Sankovich v. Ins. Co. of N. Am., 638 F.2d 136, 140 (9th Cir. 1981).
The issue of material fact required by Rule 56 need not be resolved conclusively in favor of the party asserting its existence. Id. At this stage of the litigation, the judge does not weigh conflicting evidence or make credibility determinations. These determinations are the province of the factfinder at trial. Id.; see also Abdul-Jabbar v. Gen. Motors Corp., 85 F.3d 407, 410 (9th Cir. 1996) (on a motion for summary judgment, the court is not to weigh the evidence or determine the truth of the matter, but only determine whether there is a genuine issue for trial).
Deference to the non-moving party does have some limit. The non-moving party "must set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e) (emphasis added). The "mere existence of a scintilla of evidence in support of the plaintiff's position would be insufficient." Anderson v. Liberty Lobby Inc., 477 U.S. 242, 252 (1986). Therefore, where "the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).
DISCUSSION
A. Plaintiffs' Supplemental Report
Prior to evaluating the merits of defendant's Motion for Summary Judgment, the court must determine whether it may consider plaintiffs' late submission of supplemental materials. On February 27, 2004, plaintiffs filed their Motion for Leave to File Supplementation. The supplementation includes the expert report of Dr. Itamar Simonson. This submission is late, and plaintiffs have failed to show good cause for admitting Dr. Simonson's report.
As explained in the court's January 28, 2004, Order, when plaintiffs requested additional time to file a response to defendant's Motion for Summary Judgment, the court gave plaintiffs three times the amount of time they requested. On January 28, 2004, the court granted plaintiffs additional time until February 17, 2004, to complete and file their expert report, noting that "[n]o further extensions of deadlines for either party will be granted absent a good cause showing." January 28, 2004, Order.
Plaintiffs' expert disclosure deadline passed on February 17, 2004, without any expert report being filed. Plaintiffs do not explain why they have failed to comply with the court's latest deadline. Consistent with the court's previous admonition that further extensions would not be granted absent a good cause showing, plaintiffs' Motion for Leave to File Supplementation is denied.
B. Defendant's Motion for Summary Judgment
1. Infringement
Defendant moves for summary judgment on plaintiffs' first four claims for relief. Plaintiffs' first claim for relief alleges that defendant's use of the "Sambuck's" name infringes on plaintiffs' distinctive mark in violation of 15 U.S.C. § 1114(1). The Lanham Act prohibits parties from reproducing, counterfeiting, copying, or imitating a registered mark, if such activity "is likely to cause confusion. . . ." 15 U.S.C. § 1114(1)(a). The determination of consumer confusion typically involves an intensely factual inquiry. Levi Strauss Co. v. Blue Bell, Inc., 778 F.2d 1352, 1356 n. 5 (9th Cir. 1985).
When determining whether defendant's use of "Sambuck's" is likely to cause consumer confusion, the court considers eight factors: (1) strength of the mark; (2) proximity of goods or services offered by the parties; (3) similarity of the marks; (4) evidence of actual confusion; (5) marketing channels used by the parties; (6) degree of consumer care; (7) defendant's intent in selecting the mark; and (8) likelihood of expansion of product lines. See Playboy Enter., Inc. v. Netscape Communications Corp., 354 F.3d 1020, 1026 (9th Cir. 2004) (citing AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-49 (9th Cir. 1979)).
No one factor is dispositive. "[I]t is the totality of facts in a given case that is dispositive." Entrepreneur Media, Inc. v. Smith, 279 F.3d 1135, 1140 (9th Cir. 2002) (citing Rodeo Collection, Ltd. v. West Seventh, 812 F.2d 1215, 1217 (9th Cir. 1987)). "A word of caution: this eight-factor test for likelihood of confusion is pliant. Some factors are much more important than others, and the relative importance of each individual factor will be case-specific." Brookfield Communications, Inc. v. West Coast Entm't Corp., 174 F.3d 1036, 1054 (9th Cir. 1999)
Having weighed these factors, the court concludes that genuine issues of material fact exist as to whether consumers are likely confused by the "Sambuck's" name. Based on plaintiffs' marketing efforts and plaintiffs' national presence in the sale of premium coffees, the "Starbucks" mark is undisputably strong. Therefore, the first factor weighs in plaintiffs' favor. Both parties sell premium coffees. Thus, the second factor weighs in plaintiffs' favor. The third factor regarding the similarity of the marks also weighs in plaintiffs' favor because "Starbucks" and "Sambuck's" are phonically similar, contain two syllables, and differ by only a few letters.
The remaining factors are either indeterminate or tip in plaintiffs' favor. Actual confusion, the fourth factor, is not a required element of a trademark infringement claim. Brookfield Communications, 174 F.3d at 1050 ("The failure to prove instances of actual confusion is not dispositive against a trademark plaintiff, because actual confusion is hard to prove; difficulties in gathering evidence of actual confusion make its absence generally unnoteworthy."). Therefore, plaintiffs' failure to produce evidence of actual confusion is not dispositive. Further, with regard to the "degree of customer care" factor, there is a factual dispute as to the degree of care taken by coffee buyers in making purchasing decisions.
Although intent to confuse is not a required element of the inquiry, a genuine issue of material fact exists as to defendant's reasons for changing the name of the Astoria Coffeehouse to "Sambuck's." A reasonable factfinder could conclude that defendant adopted the name "Sambuck's" because of its incorporation of her first and maiden names. However, the record also leads to the reasonable inference that the name change was made in order to profit from the similarity between "Sambuck's" and "Starbucks." Therefore, the seventh factor is in equipoise. Finally, the eighth factor addressing the likelihood of expansion tips slightly in plaintiffs' favor because plaintiffs operate a business in a community neighboring Astoria and plaintiffs' business continues to expand nationally.
Although the eight factors discussed here are relevant, the likelihood of consumer confusion is the "core element" of a trademark infringement inquiry. Brookfield Communications, 174 F.3d at 1053 (citing Official Airline Guides, Inc. v. Goss, 6 F.3d 1385, 1391 (9th Cir. 1993)). Because the record does not definitively establish whether or not customers are confused by the "Sambuck's" name, summary judgment cannot be granted to defendant.
2. Federal Dilution
Plaintiffs' second claim is brought under the Federal Trademark Dilution Act (FTDA). 15 U.S.C. § 1125(c) and 1127. Plaintiffs allege that defendant's use of "Sambuck's" dilutes plaintiffs' distinctive mark.
In Moseley v. V Secret Catalogue, Inc., 537 U.S. 418, 429 (2003), the Supreme Court determined that a non-identical mark does not dilute a famous mark merely because "consumers mentally associate the junior user's mark with a famous mark. . . ." Id. at 433. The Court concluded that the FTDA required proof of "actual dilution," id., which is defined as a "lessening of the capacity of a famous mark to identify and distinguish goods or services . . . ." 15 U.S.C. § 1127. There is no evidence in the record to suggest either directly or inferentially that the "Sambuck's" name dilutes plaintiffs' mark. Although the name "Sambuck's" may cause some consumers to think of the "Starbucks" mark, under Moseley, such association is insufficient to assert a claim for federal dilution.
Plaintiffs have offered no evidence to suggest that defendant's use of the "Sambuck's" mark has lessened the capacity of the "Starbucks" mark to identify and distinguish goods and services. Accordingly, defendant's Motion for Summary Judgment on plaintiffs' second claim for relief is granted.
3. Unfair Competition and Unlawful Trade Practices
Plaintiffs bring their third and fourth claims under 15 U.S.C. § 1125(a) and Oregon's Unlawful Trade Practices Act (OUTPA), O.R.S. § 646.608, which prohibits persons from engaging in unlawful practices that cause a likelihood of confusion as to the sources of goods or services. O.R.S. § 646.608(1)(b). "The gravamen of both an infringement and an unfair competition claim is whether the defendant has created a `likelihood of confusion.'" Shakey's Inc. v. Covalt, 704 F.2d 426, 431 (9th Cir. 1983) (citing 15 U.S.C. § 1125(a); see also O.R.S. § 646.608(1)(b); New West Corp. v. NYM Co., 595 F.2d 1194, 1201 (9th Cir. 1979); 88 cents Stores, Inc. v. Martinez, 227, 361 P.2d 809, 812 (Or. 1961)). Further prohibited by the OUTPA are acts that likely confuse consumers regarding the association of a product or misrepresentations regarding a product's sponsorship. O.R.S. § 646.608(1)(b) and (e). Given the similarity of the marks in question, a reasonable factfinder could determine that consumers are likely confused by the "Sambuck's" mark or are led to believe that defendant's business is associated with or sponsored by plaintiffs'.
Defendant asserts that this claim fails as a matter of law because plaintiffs have offered no evidence of an actual loss caused by defendant's use of the "Sambuck's" name. See O.R.S. § 646.638. However, as discussed above, a genuine issue of material facts exists as to whether defendant has infringed on plaintiffs' mark. If proved, such infringement could negatively affect sales or brand association by causing customers to be confused when making purchasing decisions. Such damages are sufficiently ascertainable to be cognizable under the OUTPA. O.R.S. § 646.638. Accordingly, defendant's Motion for Summary Judgment on plaintiffs' third and fourth claims is denied.
4. Remaining State Claim
Defendant did not move for summary judgment on plaintiffs' fifth claim for relief, brought under O.R.S. § 647.085 et seq. The court expresses no opinion on that claim.
B. Defendant's Motion to Determine Sufficiency of Discovery Responses
In the fall of 2003, while plaintiffs' Motion to Enforce Settlement Agreement was pending, the parties contacted one another regarding the discovery schedule. In September 2003, defendant served plaintiffs with interrogatories, requests for production, and requests for admission. Plaintiffs refused to provide substantive responses until a ruling on the potentially dispositive Motion to Enforce Settlement Agreement was issued.
On December 5, 2003, defense counsel informed plaintiffs' counsel that defendant would not appear for a deposition until the court had ruled on the Motion to Enforce Settlement Agreement. Therefore, it appears that both parties refused to engage in discovery while the Motion to Enforce Settlement Agreement was pending.
Subsequent to the court's ruling on the Motion to Enforce Settlement Agreement, the court set a new discovery deadline, and plaintiffs have agreed to respond by the new deadline. Based on the parties' mutual refusal to engage in discovery during the pendency of the Motion to Enforce Settlement Agreement and plaintiffs' compliance with the new discovery deadline, defendant's Motion to Determine Sufficiency of Discovery Responses is denied as moot.
C. Plaintiffs' Motion to Compel
Plaintiffs seek to compel responses to plaintiffs' Requests for Production #1-4, 10, 12-14, and 21. The Federal Rules of Civil Procedure permit parties to request the production of documents and tangible things that are reasonably calculated to lead to the discovery of admissible evidence. Fed.R.Civ.P. 26(b)(1), 34(a). This court may limit the scope of a party's request if the burden or expense of production outweighs its likely benefit. Fed.R.Civ.P. 26(b)(2)(iii).
Plaintiffs' Requests for Production #1-3 are overly burdensome. These requests seek "all documents" relevant to defendant's responses to plaintiffs' requests for admission and interrogatories. Defendant has responded to each of plaintiffs' requests for admission and interrogatories. Further, defendant states that she has produced all relevant documents in her possession. Plaintiffs are essentially attempting to resubmit their requests for admission and interrogatories in the form of their first three requests for production. Such blanket requests are overly burdensome, in light of defendant's prior responses.
Defendant has responded to Requests #4, 10, 12, and 13, and need not provide further responses, subject to her duty to supplement. Fed.R.Civ.P. 26(d).
Defendant shall provide more specific responses to Requests #14 and 21 within twenty-one days of this Opinion and Order. In her response to Request #14, defendant shall identify documents in her possession, custody, or control, if any, that relate to the promotion of the "Sambuck's" name. In her response to Request #21, defendant shall identify documents in her possession, custody, or control, if any, that refer or relate to plaintiffs or the "Starbucks" name.
CONCLUSION
For the following reasons, plaintiffs' motion for Leave to File Supplementation is denied (Doc. #105); defendant's Motion for Summary Judgment is granted in part (Doc. #53); defendant's Motion to Determine Sufficiency of Discovery Responses (Doc. #67) is denied as moot; and plaintiffs' Motion to Compel (Doc. #76) is granted in part.
IT IS SO ORDERED.