Activision Publ'g, Inc. v. Warzone.com, LLC

• Docket Number: Case No. 2:21-cv-03073-FLA (JCx)
• Decision Date: 15 August 2022
• Parties: ACTIVISION PUBLISHING, INC., Plaintiff, v. WARZONE.COM, LLC, Defendant.
• Court: U.S. District Court — Central District of California

621 F.Supp.3d 1090

ACTIVISION PUBLISHING, INC., Plaintiff,
v.
WARZONE.COM, LLC, Defendant.

Case No. 2:21-cv-03073-FLA (JCx)

United States District Court, C.D. California

Signed August 15, 2022

621 F.Supp.3d 1092

Marc Ellis Mayer, Karin G. Pagnanelli, Mitchell Silberberg and Knupp LLP, Los Angeles, CA, Lindsay R. Edelstein, Pro Hac Vice, Mitchell Silberberg and Knupp LLP, New York, NY, for Plaintiff.

Brett E. Lewis, Pro Hac Vice, Michael D. Cilento, Pro Hac Vice, Roberto Ledesma, Pro Hac Vice, Lewis and Lin LLC, Brooklyn, NY, Alyssa K. Schabloski, Gladius Law, APC, Santa Monica, CA, for Defendant.

ORDER GRANTING ACTIVISION PUBLISHING, INC.'S MOTION TO DISMISS COUNTERCLAIMS, AND JUDGMENT ON THE PLEADINGS [DKT. 24]

FERNANDO L. AENLLE-ROCHA, United States District Judge

RULING

Before the court is Plaintiff and Counterclaim-Defendant Activision Publishing, Inc.'s ("Activision" or "Plaintiff") Motion to Dismiss Counterclaims And/or for Judgment on the Pleadings ("Motion"). Dkt. 24 ("Mot."). Defendant and Counterclaimant, Warzone.com LLC ("Warzone.com" or "Defendant"), opposes the Motion. Dkt. 29 ("Opp'n"). On December 6, 2021, the court found this matter appropriate for resolution without oral argument and vacated the hearing set for December 10, 2021.

621 F.Supp.3d 1093

Dkt. 37; see Fed. R. Civ. P. 78(b); Local Rule 7-15.

For the reasons stated herein, the court GRANTS Plaintiff's Motion, DISMISSES Defendant's counterclaims without leave to amend, and ENTERS Judgment in Plaintiff's favor on the Complaint.

BACKGROUND

The following allegations are taken from Plaintiff's Complaint. Dkt. 1 ("Compl."). Activision is a publisher of video games and interactive entertainment products, including the Call of Duty video game series. Id. ¶ 2. Activision released the first Call of Duty game in 2003 and has since released 16 major installments to the Call of Duty franchise. Id. ¶¶ 2, 13. Activision has sold more than 300 million Call of Duty games, which Plaintiff contends is considered the most successful first-person shooter game franchise ever made. Id. ¶ 14. On March 10, 2020, Activision released a stand-alone, "free to play," online multiplayer game titled Call of Duty: Warzone ("CODWZ"). Id. ¶ 15. CODWZ is a first-person shooter game that features a large computer-generated battlefield, or warzone, that accommodates up to 150 payers, and sometimes 200 players, at one time. Id. ¶ 16.

Warzone.com develops and makes available to the public a browser-based game titled Warzone. Id. ¶ 19. Warzone is a free-to-play, turn-based strategy game. Id. Players shift numbers, which represent armies, across a map of the world to take control of countries or territories. Id. ¶ 22. Warzone.com markets that game as "Better than Hasbro's RISK game." Id. Warzone.com released Warzone in November 2017, and it is available on Warzone.com's internet website and mobile devices. Id. ¶ 20. Warzone is not available on video game consoles. Id.

On or about June 25, 2020, Activision filed applications for registration of the trademarks WARZONE and CALL OF DUTY WARZONE. Id. ¶ 26. On October 30, 2020, Warzone.com filed applications for registration of the trademark WARZONE. Id. ¶ 27. Warzone.com filed a Notice of Opposition to the registration of the Activision marks and the opposition proceeding is currently pending before the USPTO. Id. ¶ 29. On November 20, 2020, Warzone.com's counsel sent a cease-and-desist letter to Activision's counsel, demanding that Activision "change the name of its games, stop using Warzone's WARZONE mark, and abandon the trademark applications." Id. ¶ 30. Activision and Warzone.com were unable to resolve the dispute, and Warzone.com indicated it intended to seek injunctive relief and damages against Activision. Id. ¶¶ 3, 32.

In this action, Activision seeks a declaration of non-infringement under the Lanham Act, 15 U.S.C. § 1125, that its use and registration of the word marks WARZONE and CALL OF DUTY WARZONE do not infringe Warzone.com's purported trademark rights in the title of its game titled Warzone. Id. ¶¶ 1, 32. On June 8, 2021, Defendant filed counterclaims for unfair competition and trademark infringement under the Lanham Act, 15 U.S.C. § 1125 ("Counterclaim I"), unfair competition and false advertising under California law, Cal. Bus. & Prof. Code §§ 17200 and 17500 et seq. ("Counterclaim II"), and trademark infringement under California common law ("Counterclaim III"). Dkt. 14 ("Answer and Counterclaims") at 16-19. According to Defendant, it has been using the WARZONE mark in commerce since at least November 13, 2017, and it has pending applications before the USPTO for the mark WARZONE. Id. at 8, ¶¶ 3, 5-6. Defendant contends that given the popularity of the Call of Duty franchise, Activision's use of WARZONE has saturated the market in a manner that has overwhelmed Warzone.com. Id. at 14, ¶ 23.

621 F.Supp.3d 1094

DISCUSSION

I. Legal Standard

"After the pleadings are closed—but early enough not to delay trial—a party may move for judgment on the pleadings." Fed. R. Civ. P. 12(c) ("Rule 12(c)"). The legal standard for a motion for judgment on the pleadings under Rule 12(c) is "functionally identical" to a motion to dismiss under Fed. R. Civ. P. 12(b)(6) ("Rule 12(b)(6)"). Dworkin v. Hustler Magazine, Inc., 867 F.2d 1188, 1192 (9th Cir. 1989). The same legal standard applies to motions brought under either rule. Id. Thus, the issue presented by a Rule 12(c) motion is whether the factual allegations of the complaint, together with all reasonable inferences, state a plausible claim for relief. Cafasso v. Gen. Dynamics C4 Sys., 637 F.3d 1047, 1054 & n. 4 (9th Cir. 2011). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)).

In evaluating a motion for judgment on the pleadings, the court "must accept all factual allegations in the complaint as true and construe them in the light most favorable to the non-moving party." Fleming v. Pickard, 581 F.3d 922, 925 (9th Cir. 2009); see also Hal Roach Studios, Inc. v. Richard Feiner & Co., Inc., 896 F.2d 1542, 1550 (9th Cir. 1989) ("For purposes of the motion, the allegations of the non-moving party must be accepted as true, while the allegations of the moving party which have been denied are assumed to be false."). "Judgment on the pleadings is proper when the moving party clearly establishes on the face of the pleadings that no material issue of fact remains to be resolved and that it is entitled to judgment as a matter of law." Hal Roach, 896 F.2d at 1550.

II. Analysis

A. Lanham Act Claim

Generally, courts within the Ninth Circuit apply an eight-factor "likelihood-of-confusion test" to claims brought under the Lanham Act. Twentieth Century Fox Television v. Empire Distrib., Inc., 875 F.3d 1192, 1196 (9th Cir. 2017). But when a trademark is included in an expressive work, the protections afforded under trademark laws must also be balanced against broader First Amendment concerns. Id.; see also Mattel, Inc. v. MCA Records, Inc., 296 F.3d 894, 900 (9th Cir. 2002) (noting "when a trademark owner asserts a right to control how we express ourselves . . . applying the traditional [likelihood-of-confusion] test fails to account for the full weight of the public's interest in free expression"). In circumstances involving an expressive work, a plaintiff with Lanham Act claims must instead overcome the test articulated in Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989), which was adopted by the Ninth Circuit in Mattel, 296 F.3d at 902. See also Twentieth Century Fox, 875 F.3d at 1196; E...