IP Glob. Invs. Am., Inc. v. Body Glove IP Holdings, LP
| Decision Date | 14 November 2018 |
| Docket Number | Case No. 2:17-cv-06189-ODW (AGR) |
| Court | U.S. District Court — Central District of California |
| Parties | IP GLOBAL INVESTMENTS AMERICA, INC., Plaintiff, v. BODY GLOVE IP HOLDINGS, LP, and MARQUEE BRANDS LLC Defendants. |
ORDER GRANTING IN PART PLAINTIFF'S MOTION FOR PARTIAL SUMMARY JUDGMENT [67, 68, 105] AND DENYING DEFENDANTS' MOTION FOR PARTIAL SUMMARY JUDGMENT [70]
Plaintiff IP Global Investments America, Inc. ("IP Global" or "IPG") and Defendants Body Glove IP Holdings, LP and Marquee Brands, LLC (collectively, "BGH") each move for partial summary judgment in this breach of licensing agreement/trademark infringement action. (IP Global's Mot. for Partial Summ. J. ("IPG MPSJ"), ECF Nos. 67, 68, 105; BGH's Mot. for Partial Summ. J. ("BGH MPSJ"), ECF No. 70.) For the reasons discussed below, the Court GRANTS, IN PART, IP Global's MPSJ (ECF Nos. 67, 68, 105), and DENIES BGH's MPSJ (ECF No. 70).1
This action involves a license agreement between IP Global and BGH, executed originally in 1988 by the parties' predecessors in interest. (IPG Separate Statement of Uncontroverted Facts ("IPGUF") No. 1, ECF No. 67; Decl. of Michael M. Amir ("Amir Decl.") ¶¶ 2-3, Exs. 1 (1988 Agreement), 2 (2011 Amendment), ECF No. 67-2.) The Agreement as amended ("Agreement") grants IP Global exclusive rights to "design, manufacture, distribute, advertise, and sell licensed Body Glove products in certain Asian markets." (IPGUF No. 1.) It automatically renews for continual, successive ten-year periods, provided that IP Global has paid certain royalties and is not in "uncured material breach." (Id. at No. 3.) The Agreement authorizes IP Global to sub-license rights granted under the Agreement, which, as is relevant to this matter, IP Global has done with companies in Thailand and Malaysia. (Id. at Nos. 6-7; BGH Additional Uncontroverted Facts ("BGHUF") No. 63, ECF No. 103-1.) The Agreement includes an approval process through which IP Global obtains approval for use of the Body Glove mark ("Approval Protocol"). (IPGUF Nos. 14-17; BGHUF No. 63.) The Agreement also includes a provision entitled "Breach and Cure." (IPGUF No. 4.) The Breach and Cure provision provides:
On or about October 31, 2016, BGH acquired a 75% interest in the Body Glove brand and became the successor-licensor of the Agreement. (IPGUF No. 28; BGH Opp. to IPG MPSJ ("BGH Opp.") 10, ECF No. 103.) BGH contends that, followingits acquisition, it learned that IP Global had breached, and continued to breach, the Agreement. (Id.) On May 17, 2017, BGH sent IP Global a written Notice of Default stating, among other things, that IP Global was in default of the Agreement for failure to adhere to the Approval Protocol. (Id.; BGHUF No. 82; Amir Decl. ¶ 23, Ex. 21 ("Notice of Default").) In communications between the parties before and after BGH sent the Notice of Default, IP Global requested that BGH identify the specific instances of noncompliance so that IP Global could take corrective action. (IPG Reply 11, ECF No. 110-1; Amir Decl. Ex. 20; Decl. of Michael Neuman ("Neuman Decl."), Ex. 3, ECF No. 103-3.) In subsequent letters, BGH informed IP Global that it deemed the Agreement terminated "based on [IP Global's] failure to cure the material breaches identified in the notices of default." Decl. of Michael M. Amir ( )
IP Global contends that BGH manufactured a default to force IP Global to relinquish rights held under the Agreement. (IPG MPSJ 9-10.) IP Global asserts that BGH threatened IP Global with default, and with informing IP Global's potential buyer of the default, if IP Global did not accept amendments to the Agreement. (IPG MPSJ 16-18.) IP Global argues that BGH's internal documents and emails show that, when IP Global did not acquiesce to BGH's demands, BGH engaged in the "nuclear option" including refusing to approve any new products going forward and declaring that IP Global had breached the Agreement. (IPG MPSJ 9, 16-18; IPGUF Nos. 39-43.)
On August 21, 2017, IP Global brought this action against BGH, asserting seven causes of action: (1) Breach of Contract; (2) Breach of the Implied Covenant of Good Faith and Fair Dealing; (3) and (5) Intentional Interference with Contractual Relations; (4) and (6) Intentional Interference with Prospective Economic Advantage; and (7) Declaratory Relief. IP Global brought its third cause of action against only Defendant Marquee Brands, LLC, but asserted all other claims against bothDefendants. (See Compl., ECF No. 1.) On December 18, 2017, Defendant Body Glove IP Holdings, LP3 counterclaimed against IP Global, asserting eight counterclaims: (1) Breach of Contract; (2) Breach of Breach of the Implied Covenant of Good Faith and Fair Dealing; (3) Preliminary and Injunctive Relief; (4) Declaratory Relief; (5) Contributory Trademark Infringement; (6) Trademark Infringement under the Lanham Act; (7) False Designation under the Lanham Act; and (8) Common Law Trademark Infringement. (Am. Answer and Countercl., ECF Nos. 28, 35.)4
The parties now cross-move for partial summary judgment as to certain claims and counterclaims. (See generally IPG MPSJ; BGH MPSJ.)
Summary judgment is appropriate if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). Courts must view the facts and draw reasonable inferences in the light most favorable to the nonmoving party. Scott v. Harris, 550 U.S. 372, 378 (2007). A disputed fact is "material" where the resolution of that fact "might affect the outcome of the suit under the governing law," and the dispute is "genuine" where "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Conclusory or speculative testimony in affidavits is insufficient to raise genuine issues of fact and defeat summary judgment. Thornhill's Publ'g Co. v. GTE Corp., 594 F.2d 730, 738 (9th Cir. 1979). Moreover, though the court may not weigh conflicting evidence or make credibility determinations, there must be more than a mere scintilla of contradictory evidence to survive summary judgment. Addisu v. Fred Meyer, Inc., 198 F.3d 1130, 1134 (9th Cir. 2000).
The moving party bears the initial burden to identify those portions of the record establishing the lack of a genuine issue for trial before the nonmoving party must introduce evidence. See Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the moving party satisfies its burden, the nonmoving party cannot simply rest on the pleadings or argue that any disagreement or "metaphysical doubt" about a material issue of fact precludes summary judgment. See id. at 322-23; Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); Cal. Architectural Bldg. Prods., Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1468 (9th Cir. 1987). Nor will uncorroborated allegations and self-serving testimony create a genuine issue of material fact. Villiarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th Cir. 2002). The court should grant summary judgment against a party who fails to demonstrate facts sufficient to establish an element essential to his case when that party will ultimately bear the burden of proof at trial. See Celotex, 477 U.S. at 322. It is not the district court's task "to scour the record" for support to the parties' arguments. Keenan v. Allan, 91 F.3d 1275, 1278 (9th Cir. 1996). The parties bear the obligation to lay out their support clearly. Carmen v. S.F. Unified Sch. Dist., 237 F.3d 1026, 1031 (9th Cir. 2001).
Pursuant to the Local Rules, parties moving for summary judgment must file a proposed "Statement of Uncontroverted Facts and Conclusions of Law" that should set out the material facts to which the moving party contends there is no genuine dispute. C.D. Cal. L.R. 56-1. A party opposing the motion must file a "Statement of Genuine Disputes" setting forth all material facts as to which it contends there exists a genuine dispute. C.D. Cal. L.R. 56-2. "[T]he Court may assume that material facts as claimed and adequately supported by the moving party are admitted to exist without controversy except to the extent that such material facts are (a) included in the 'Statement of Genuine Disputes' and (b) controverted by declaration or other written evidence files in opposition to the motion." C.D. Cal. L.R. 56-3.
Both parties submitted voluminous evidence and objections to evidence. Much of the evidence was unnecessary to the resolution of these motions. As such, the Court need not rule on the admissibility of such evidence at this time. To the extent the Court relies on evidence objected to in resolving the cross-motions without discussion, the relevant objections are OVERRULED. See Burch v. Regents of Univ. of Cal., 433 F. Supp. 2d 1110, 1118, 1122 (E.D. Cal. 2006).
IP Global moves for partial summary judgment on BGH's counterclaims for (1) breach of contract, (2) breach of the implied covenant, (5) contributory trademark infringement, and damages as to certain of BGH's counterclaims. (See IPG MPSJ.) BGH opposes, except for the fifth counterclaim, contributory trademark infringement, which BGH agrees to dismiss. (BGH Opp. 21.)
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