Balance Studio, Inc. v. Cybernet Entm't, LLC
| Decision Date | 18 April 2016 |
| Docket Number | Case No. 15-cv-04038-DMR |
| Parties | BALANCE STUDIO, INC., Plaintiff, v. CYBERNET ENTERTAINMENT, LLC, Defendant. |
| Court | U.S. District Court — Northern District of California |
In this trademark infringement action, Plaintiff Balance Studio, Inc., doing business as Kink Academy and KinkAcademy.com ("Kink Academy"), sues Defendant Cybernet Entertainment, LLC, doing business as Kink.com, for violations of the Lanham Act, 15 U.S.C. §§ 1114, 1125, and state law. Defendant moves to dismiss. [Docket No. 9.] The court finds this matter suitable for resolution without a hearing. See Civ. L.R. 7-1(b). For the following reasons, Defendant's motion is denied.
Plaintiff makes the following allegations in its complaint, all of which are taken as true for purposes of this motion.1 Plaintiff is a business that offers adult sexual education through various media, including its website, KinkAcademy.com; workshops; and seminars. Compl. ¶ 7. KinkAcademy.com offers "a comprehensive library of sexual education videos for adventurous adults," as well as a variety of written educational content. Id. Plaintiff's mission is to offer educational videos and other content that "fosters confidence and a positive body image in its customers." Id. at ¶ 8. Plaintiff alleges that it has developed a strong reputation for integrity andhigh-quality educational materials within the community of adult sexual educators, and developed a diverse and loyal customer base. Id. at ¶ 9. KinkAcademy.com has been offering adult sexual education materials since 2007, and has been used continually for that purpose. Id. at ¶ 10.
Plaintiff owns U.S. Trademark Registration Number 3958399 for the "Kink Academy" word and logo mark. Id. at ¶ 11; Def.'s Request for Judicial Notice ("RJN")2 Ex. D. The mark was registered on May 10, 2011. RJN Ex. D. USPTO registration information for Plaintiff's word and logo mark indicates the mark was first used on February 1, 2007, and first used in commerce on April 1, 2009. It describes the mark as follows:
The mark consists of large letter "K" in the color purple with a white and purple outline, a stylized graduation cap in black on top of the left leg of the "K", a black leash attached to the lower leg of the "K" going up and around to the left in a circular manner, with the text "Kink Academy" in black underneath the "K".
RJN Ex. D. The Kink Academy word and logo mark is registered "in International Class 041 for adult sexuality education, namely, through workshops, seminars, on-line video classes featuring information on adult role-play, bondage, domination and submission, fetishes and gender exploration designed to enhance couple's [sic] intimacy, and acknowledgement of one's own sexuality." Compl. ¶¶ 12, 13; RJN Ex. D.
Defendant owns and operates an adult entertainment website, Kink.com, which offers pornographic videos. Id. at ¶ 14. On or before November 2014, Kink.com began operating a "Kink University" website, accessible at kinkuniversity.com. Id. at ¶ 15.3 RJN ¶ 16. KinkUniversity is a pornography website that purports to offer educational information, but its primary purpose is entertainment. Id. at ¶ 15. Plaintiff alleges on information and belief that Peter Acworth, Defendant's owner and founder, signed up to be a member of KinkAcademy.com before launching KinkUniversity.com. Id. at ¶ 16. Defendant uses a logo that includes a stylized "K" and a diploma, with the phrase "Kink University." Id. at ¶ 17.
On April 8, 2014, Defendant filed a trademark application for the term, "Kink University," listing a date of first use in commerce of April 1, 2014. Id. at ¶¶ 18, 19. It sought to register the "Kink University" mark in "International Class 041 for Education services, namely, providing live and on-line classes, panel discussions, tutorials, seminars, and workshops in the field of sexuality." Id. at ¶ 20. The Trademark Office rejected Defendant's application on July 23, 2014 due to a likelihood of consumer confusion between "Kink University" and the Kink Academy word and logo mark. Id. at ¶ 21; RJN Ex. L ("Registration of the applied-for mark is refused because of a likelihood of confusion with the mark in U.S. Registration No. 3958399."). Defendant's application was deemed abandoned on February 20, 2015. It subsequently moved to revive the application, and on April 14, 2015, the Trademark Office issued a final rejection of Defendant's "Kink University" mark, reiterating that the two marks "convey a similar commercial impression" and that the use of "Kink University" would likely cause consumer confusion with the "Kink Academy" word and logo mark. Id. at ¶¶ 22, 23; RJN Exs. M, N (April 14, 2015 USPTO Final Action).
Plaintiff alleges that Defendant continues to infringe its "Kink Academy" word and logo mark, despite the Trademark Office's determination, and that Defendant's "Kink University" website is "designed to take advantage of the significant name recognition and goodwill surrounding Kink Academy and its products." Id. at ¶¶ 24, 25. It further alleges that it has suffered monetary damage in the form of diverted traffic and lost sales, and that Defendant is damaging the valuable reputation and goodwill in Plaintiff's brand by "marketing pornography videos under the guise of educational videos." Id. at ¶ 26. Finally, Plaintiff alleges that actualconfusion has already occurred between Kink Academy and Kink University. Id. at ¶ 27.
Plaintiff alleges three claims for relief: 1) trademark infringement pursuant to 15 U.S.C. § 1114; 2) false designation of origin pursuant to 15 U.S.C. § 1125(a); and 3) unfair competition pursuant to California Business and Professions Code section17200 et seq. Defendant moves to dismiss Plaintiff's complaint.
A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the claims alleged in the complaint. See Parks Sch. of Bus., Inc. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995). When reviewing a motion to dismiss for failure to state a claim, the court must "accept as true all of the factual allegations contained in the complaint," Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per curiam) (citation omitted), and may dismiss a claim "only where there is no cognizable legal theory" or there is an absence of "sufficient factual matter to state a facially plausible claim to relief." Shroyer v. New Cingular Wireless Servs., Inc., 622 F.3d 1035, 1041 (9th Cir. 2010) (citing Ashcroft v. Iqbal, 556 U.S. 662, 677-78 (2009); Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001)) (quotation marks omitted). A claim has facial plausibility when a plaintiff "pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678 (citation omitted). In other words, the facts alleged must demonstrate "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly, 550 U.S. 554, 555 (2007) (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)); see Lee v. City of L.A., 250 F.3d 668, 679 (9th Cir. 2001) , overruled on other grounds by Galbraith v. Cnty. of Santa Clara, 307 F.3d 1119 (9th Cir. 2002) .
As a general rule, a court may not consider "any material beyond the pleadings" when ruling on a Rule 12(b)(6) motion. Lee, 250 F.3d at 688 (citation and quotation marks omitted). However, "a court may take judicial notice of 'matters of public record,'" Id. at 689 (citing Mack v. S. Bay Beer Distrib., 798 F.2d 1279, 1282 (9th Cir. 1986)), and may also consider "documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the pleading," without converting a motion to dismiss under Rule12(b)(6) into a motion for summary judgment. Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir. 1994), overruled on other grounds by Galbraith v. Cnty. of Santa Clara, 307 F.3d 1119 (9th Cir. 2002). The court need not accept as true allegations that contradict facts which may be judicially noticed. See Mullis v. U.S. Bankr. Ct., 828 F.2d 1385, 1388 (9th Cir. 1987).
A. Trademark Infringement
Plaintiff's first claim is for trademark infringement under 15 U.S.C. § 1114. "A successful trademark infringement claim under the Lanham Act requires a showing that the claimant holds a protectable mark, and that the alleged infringer's imitating mark is similar enough to 'cause confusion, or to cause mistake, or to deceive.'" Surfvivor Media, Inc. v. Survivor Prods., 406 F.3d 625, 630 (9th Cir. 2005) (quoting KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111, 117 (2004)).
Here, Plaintiff alleges that it owns U.S. Trademark Registration Number 3958399 for the "Kink Academy" word and logo mark. Registration of a mark on the principal register in the USPTO is "prima facie evidence of the validity of the registered mark and of [the registrant's] exclusive right" to its use. Brookfield Commc'ns, Inc. v. W. Coast Entm't Corp., 174 F.3d 1036, 1047 (9th Cir. 1999). Plaintiff also alleges that actual consumer confusion has already occurred between the Kink Academy word and logo mark and Kink University.
Defendant does not argue that Plaintiff fails to plead ownership of a registered mark or likelihood of or actual consumer confusion. Instead, it argues that Plaintiff cannot show liability for infringement based on Defendant's use of disclaimed portions of Plaintiff's composite design mark, where Plaintiff cannot establish secondary meaning to those disclaimed portions. Reply at 5. Defendant submits judicially-noticeable evidence in support of its argument that Plaintiff has rights to a composite design mark only. The USPTO history of Plaintiff's "Kink Academy" word and logo mark shows that Plaintiff disclaimed any exclusive right to the word "acade...
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