Innovation Ventures, LLC v. Ultimate One Distrib. Corp.

• Decision Date: 31 March 2016
• Docket Number: 12-CV-5354 (KAM) (RLM),13-CV-6397 (KAM) (RLM)
• Citation: 176 F.Supp.3d 137
• Parties: Innovation Ventures, LLC; Living Essentials, LLC; and International IP Holdings, LLC, Plaintiffs, v. Ultimate One Distributing Corp., et al., Defendants. Innovation Ventures, LLC; Living Essentials, LLC; and International IP Holdings, LLC, Plaintiffs, v. Pittsburg Wholesale Grocers, Inc., et al., Defendants.
• Court: U.S. District Court — Eastern District of New York

176 F.Supp.3d 137

Innovation Ventures, LLC; Living Essentials, LLC; and International IP Holdings, LLC, Plaintiffs,

v.Ultimate One Distributing Corp., et al., Defendants.

Innovation Ventures, LLC; Living Essentials, LLC; and International IP Holdings, LLC, Plaintiffs,

v.Pittsburg Wholesale Grocers, Inc., et al., Defendants.

12-CV-5354 (KAM) (RLM)

13-CV-6397 (KAM) (RLM)

United States District Court, E.D. New York.

Signed March 31, 2016

Alexander Michaels, Christos George Yatrakis, Geoffrey Potter, Jane Metcalf, Jeremy Alexander Weinberg, Jonah Moses Knobler, Michelle Waller Cohen, Adam Blumenkrantz, Thomas Philip Kurland, Patterson Belknap Webb & Tyler LLP, New York, NY, Darin J. Lebeau, Oakland Law Group, PLLC, Farmington, MI, Leslie Nizin, Kew Gardens, NY, for Plaintiffs.

Todd D. Greenberg, Addabbo & Greenberg, Forest Hills, NY, Stephen J. Kressel, Kressel, Rothlein, Walsh & Roth LLC, Arnold J. Hauptman, Massapequa, NY, Randi Wolkenbreit Singer, Weil, Gotshal & Manges, LLP, Jason Joseph Lavery, Callen Koster Brady & Brennan, Vincent A. Nagler, Callan, Regenstreich, Koster & Brady, Howard J. Shire, Natasha Sardesai Grant, Kenyon & Kenyon LLP, Andre K. Cizmarik, Anthony J. Viola, Mintz Levin Cohn Ferris Glovsky & Popeo P.C., New YOrk, NY, Zachary Winthrop Silverman, Locke Lord LLP, Jess M. Berkowitz, Ariel Samuel Peikes, Gottlieb, Rackman & Reisman PC, Danielle Marie DeFilippis, Norris McLaughlin & Marcus, PA, Brian A. Kalman, London Fischer, LLP, J. Christopher Jensen, Bridget Anne Crawford, Cowan, Liebowitz & Latman, P.C., Bruce M. Sabados, Gregory Charles Johnson, Katten Muchin Rosenman LLP, David Benjamin Sunshine, Elizabeth Nicole Warin, J. Bruce Maffeo, Cozen O'Connor, Zachary S. Goldberg, Goldberg, Corwin & Greenberg, LLP, Ronald A. Giller, Gordon & Rees LLP, New York, NY, Sarah K. Schindler-Williams, Ballard Spahr LLP, Philadelphia, PA, Richard S. Schurin, Stern & Schurin LLP, Stanley R. Goodman, Martin I. Saperstein, Goodman & Saperstein, Esqs., Brian J. Davis, Law Office of Brian J. Davis, Garden City, NY, Steven Stern, Stern & Schurin LLP, Mineola, NY, Anthony R. Paesano, Brian M. Akkashian, Richard Apkarian, Jr., Paesano Akkashian, PC, Birmingham, MI, John Ko, John Y. Ko, Attorney at Law, Orange, CA, James K. Thome, Timothy Connaughton, Vandeveer Garzia, PC, Troy, MI, Megan P. McKnight, Michael Barton, Chiara Mattieson, Plunkett Cooney, Bloomfield Hills, MI, James Renfro Thompson, David M. Greeley, Brian M. Ragen, Gregory Vega, Kathryn Quarles, David H. Lichtenstein, Seltzer Caplan McMahon Vitek, Maura Griffin, Law Offices of William A. Markham, P.C., Steven Elia, Law Offices of Steven A. Elia, APC, San Diego, CA, Aaron Thomas Duff, Norris McLaughlin & Marcus PA, Bridgewater, NJ, Daniel Jason DiMuro, Gordon & Rees LLP, Florham Park, NJ, Stanton L. Phillips, Law Office of Stanton Lee Phillips, Ira M. Siegel, Law Offices of Ira M. Siegel, Beverly Hills, CA, Stephen M. Lobbin, One LLP, Newport Beach, CA, for Defendants.

Akshar Services, LLC, Edison, NJ, pro se.

MEMORANDUM AND ORDER

MATSUMOTO, United States District Judge:

Plaintiffs Innovation Ventures, LLC; Living Essentials, LLC; and International IP Holdings, LLC (collectively, “plaintiffs” or “Living Essentials”) commenced this action alleging that defendants have been involved in a widespread scheme to manufacture, distribute, and sell counterfeit 5-hour ENERGY drinks bearing plaintiffs' trademarks and copyright. Plaintiffs assert claims pursuant to the Lanham Act, 15 U.S.C. § 1051 et seq., and Copyright Act, 17 U.S.C. § 106, and pursuant to New York statutory and common law. (See generally ECF No. 291, Seventh Amended Complaint (“Seventh Am. Compl.”) filed 12/28/12.)

Plaintiffs have settled their claims against most of the more than 70 defendants named in this consolidated action. Presently before the court is plaintiffs' omnibus motion for summary judgment against nine groups of remaining defendants (collectively, “Defendants”). Defendants are comprised of companies alleged to have participated in the counterfeiting scheme and certain owners and/or principals of those companies:

• Midwest Wholesale Distributors, Walid Jamil, Raid Jamil, and Justin Shayota (collectively, “Midwest Defendants”);

• Dan-Dee Company, Inc., Kevin Attiq, and Fadi Attiq (collectively, “Dan-Dee Defendants”);¹

• Advanced Nutraceutical Manufacturing LLC, Nutrition Private Label, Inc., and Juan Romero Gutierrez (collectively, “Romero Defendants”);

• Baseline Distribution, Inc. and David Flood (collectively, “Baseline Defendants”);

• Purity Wholesale Grocers (“Purity”);

• Core-Mark International, Inc. (“Core-Mark”);

• Food Distributors, Inc. and Scott Tilbrook (collectively, “FDI Defendants”);

• Elegant Trading and Ahmed Bhimani (collectively, “Elegant Defendants”);

• Valero Retail Holdings, Inc. (“Valero”)²

Plaintiffs move for summary judgment on their claims for: trademark infringement, false description and false designation of origin, and false advertising pursuant to Sections 32 and 43 of the Lanham Act, 15 U.S.C. §§ 1114, 1125 ; copyright infringement pursuant to 17 U.S.C. § 106 of the Copyright Act; and unfair competition pursuant to state common law. (See ECF No. 864-1, Plaintiffs' Corrected Memorandum of Law in Support of Summary Judgment (“Pls. Mem.”).)³

With respect to the Midwest Defendants, Romero Defendants, and Core-Mark Defendants, plaintiffs seek enhanced statutory damages for willful infringement under the Lanham Act, enhanced statutory damages for willful infringement under the Copyright Act, punitive damages under state common law, attorneys' fees and costs, and permanent injunctive relief. With respect to the Baseline Defendants, FDI Defendants, Elegant Defendants, Purity, and Valero, plaintiffs seek actual damages for trademark infringement under the Lanham Act, statutory damages for copyright infringement under the Copyright Act, punitive damages under state common law, attorneys' fees and costs, and permanent injunctive relief. Except for the Romero Defendants, each of the Defendants has filed an opposition to plaintiffs' omnibus summary judgment motion.

Also before the court is a cross motions for summary judgment on plaintiffs' claims filed by individual defendant David Flood (a co-owner of Baseline Distributors, Inc.).⁴ For the reasons set forth below, plaintiffs' motion for summary judgment is granted in part and denied in part. David Flood's cross-motion for summary judgment is denied.

PROCEDURAL BACKGROUND

On October 25, 2012, Living Essentials commenced this action, captioned Innovation Ventures, et al. v. Ultimate One Distributing Corp., et al. (“Ultimate Action”) in this court. In its initial complaint, plaintiffs, the owners of 5-hour ENERGY, alleged that more than twenty defendants had sold counterfeit 5-hour ENERGY in violation of the Lanham Act, 15 U.S.C. §§ 1114 and 1125, the Copyright Act of 1976, 17 U.S.C. § 106, New York state law and common law. (See U.A. No. 1, Compl. filed 10/25/12.)

On October 26, 2012, plaintiffs filed the action captioned Innovation Ventures, et al. v. Pittsburg Wholesale Grocers Inc., et al. (“Pittsburg Action”), in the United States District Court for the Northern District of California. In its initial complaint in the Pittsburg Action, plaintiffs alleged substantially the same claims as in the Ultimate Action against sixteen defendants based in California. (See P.A. No. 1, Compl. filed 10/26/12.)

As plaintiffs traced the counterfeit products up the chain of distribution, the Ultimate Action grew to include sixty-nine defendants. (See U.A. No. 291, Seventh Am. Compl.) In their Seventh Amended Complaint, plaintiffs alleged that Dan–Dee Company, Inc. (“Dan–Dee”), a defendant in the related Pittsburg Action, was the principal nationwide “distribution hub” for counterfeit 5-hour ENERGY. (Seventh Am. Compl. at 5.) A number of defendants in the Ultimate Action then impleaded Dan–Dee and its principals as third-party defendants in the Ultimate Action. (See U.A. Nos. 390, 473, 535, 580.) In turn, the Dan–Dee Defendants impleaded a number of defendants from the Ultimate Action as third-party defendants in the Pittsburg Action. (See P.A. No. 162, Am. Third–Party Compl. filed 1/23/12.)⁵

In April 2013, Capital Sales Company, a defendant in the Ultimate Action and a customer of Dan–Dee, filed suit against the Dan–Dee Defendants in the Eastern District of Michigan. The Eastern District of Michigan transferred venue to this court, and this court consolidated Capital Sales Company's suit with the Ultimate Action. (Docket 13–cv–3542, ECF No. 28, Order to Consolidate Cases dated 7/31/12.)

On November 12, 2013, plaintiffs moved to transfer venue in the Pittsburg Action from the Northern District of California to this district, on the grounds that all remaining parties in the Pittsburg Action are also parties to the larger, first-filed Ultimate Action, and the issues remaining to be tried are a subset of the issues in the Ultimate Action. (P.A. No. 508, Mot. for Change of Venue filed 11/12/13, at 1.) No party opposed the motion, and all parties signed a stipulation requesting that the Pittsburg Action “be transferred to the Eastern District of New York for consolidation with” the Ultimate Action. (P.A. No. 509, Stip. filed 11/12/13, at 2.)

On November 15, 2013, the Northern District of California transferred the Pittsburg Action to this district. (P.A. No. 530, Order Granting Mot. to Change Venue dated 11/15/13.) On March 3, 2014, the court granted a joint request from plaintiffs and the Dan-Dee Defendants to consolidate the Ultimate Action and the Pittsburg Action. (ECF No. 680.)

FACTUAL BACKGROUND

The following facts are taken from the parties' Local Civil Rule 56.1 statements, and have not been specifically or directly disputed with admissible evidence unless otherwise indicated. References to paragraphs of the parties' Rule 56.1 statements include materials cited therein and annexed thereto.⁶ The court has considered whether the parties have...