NRRM, LLC v. Kingstar Holdings, LLC
| Decision Date | 30 October 2017 |
| Docket Number | Case No. 4:17cv01665 PLC |
| Parties | NRRM, LLC d/b/a/ CARSHIELD, Plaintiff, v. KINGSTAR HOLDINGS, LLC, et al., Defendants. |
| Court | U.S. District Court — Eastern District of Missouri |
This matter is before the Court on the motion to dismiss filed by Defendants Kingstar Holdings, LLC and Caresure LLC.1 (ECF No. 11). Plaintiff NRRM, LLC filed a memorandum in opposition to Defendants' motion to dismiss. (ECF No. 15), and Defendants filed a reply brief in support of the motion (ECF No. 20).
The facts, as alleged in the complaint, are as follows: Plaintiff markets and sells vehicle service contracts under the marks CARSHIELD and CARSHIELD.COM (collectively, "CarShield marks"). (ECF No. 1 at ¶¶ 2-3). On November 29, 2016 and January 31, 2017, the United States Patent and Trademark Office (PTO) issued to Plaintiff the standard character marks "CARSHIELD.COM" and "CARSHIELD" for "[v]ehicle service contracts on vehicles manufactured by others for mechanical breakdown servicing."2 (Id. at ¶¶ 18-19; ECF Nos. 1-3,1-4). Plaintiff has continuously used various CarShield marks since April 2016 and has devoted substantial resources to marketing, advertising, and promoting those marks. (ECF No. 1 at ¶¶ 23-24).
Like Plaintiff, Defendants market and sell vehicle services contracts. (Id. at ¶1). On November 2 and November 4, 2016, Defendants filed with the PTO applications to register the word mark "CARSURE" and an associated design mark (collectively, "CarSure marks"). (Id. at ¶28, 29; ECF Nos. 1-7, 1-8). Defendants began using the CarSure marks in its marketing and advertising in early 2017. (ECF No. 1 at ¶ 30).
On June 14, 2017, Plaintiff filed its complaint alleging: (1) trademark infringement under the Lanham Trademark Act of 1986, 15 U.S.C. § 1114; (2) trademark infringement and unfair competition under the Lanham Trademark Act, 15 U.S.C. § 1125(a); and (3) trademark infringement and unfair competition under Mo. Rev. Stat. §§ 417.005-417.066 and Missouri common law. (ECF No. 1). In response, Defendants filed a Rule 12(b)(6) motion to dismiss Plaintiff's complaint for failure to state a claim upon which relief can be granted. (ECF No. 11). In support of their motion to dismiss, Defendants assert that Plaintiff "has not alleged sufficient facts to establish there is a likelihood of confusion between the parties' respective marks." (ECF No. 12 at 2). Plaintiff responds that the issue of likelihood of confusion is a question of fact that cannot be determined on a motion to dismiss. (ECF No. 15). Plaintiff further argues that, even if a motion to dismiss were an appropriate vehicle for resolving the likelihood of confusion, Plaintiff alleged sufficient facts to state a claim for relief. (Id.).
A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the legal sufficiency of a complaint. Fed. R. Civ. P. 12(b)(6). To survive a Rule 12(b)(6) motion todismiss for failure to state a claim, "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A plaintiff need not provide specific facts in support of its allegations, Erickson v. Pardus, 551 U.S. 89, 93 (2007) (per curiam), but "must include sufficient factual information to provide the 'grounds' on which the claim rests, and to raise a right to relief above a speculative level." Schaaf v. Residential Funding Corp., 517 F.3d 544, 549 (8th Cir. 2008) (citing Twombly, 550 U.S. at 555 & n.3). "A pleading that offers 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action will not do.'" Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555).
On a motion to dismiss, the Court accepts as true all of the factual allegations contained in the complaint, even if it appears that "actual proof of those facts is improbable," Twombly, 550 U.S. at 556, and "draw[s] all reasonable inferences in favor of the nonmoving party." Torti v. Hoag, 868 F.3d 666, 671 (8th Cir. 2017) (quotation omitted). In addressing a motion to dismiss, "[t]he court may consider the pleadings themselves, materials embraced by the pleadings, exhibits attached to the pleadings, and matters of public record." Mills v. City of Grand Forks, 614 F.3d 495, 498 (8th Cir. 2010) (citing Porous Media Corp. v. Pall Corp., 186 F.3d 1077, 1079 (8th Cir. 1999)).
Defendants argue that Plaintiff fails to allege sufficient facts to state a claim for trademark infringement or unfair competition. More specifically, Defendants maintain that Plaintiff's allegations do not establish a likelihood of confusion between the parties' marks.
To prevail on a claim of trademark infringement, "a plaintiff must show that it has avalid, protectible mark and that there is a likelihood of confusion between its mark and the defendant's mark." B&B Hardware, Inc. v. Hargis Indus., Inc., 569 F.3d 383, 389 (8th Cir. 2009). See also 15 U.S.C. § 1114(1); 15 U.S.C. § 1125(a)(1)(A); Sensient Techs. Corp. v. SensoryEffects Flavor Co., 636 F. Supp. 2d 891, 898 (E.D.Mo. 2009) (affirmed by 613 F.3d 754 (8th Cir. 2010) (). Likelihood of confusion exists when a defendant's use of a mark is likely to confuse, deceive, or cause mistake among an appreciable number of ordinary buyers as to the source of or association between the parties' products or services. See Duluth News-Tribune v. Mesabi Pub. Co., 84 F.3d 1093, 1096 (8th Cir. 1996).
"[L]ikelihood of confusion is a factual question." ConAgra, Inc. v. George A. Hormel, & Co., 990 F.2d 368, 371 (8th Cir. 1993). When evaluating the likelihood of confusion, courts consider the following six factors:
1) the strength of the plaintiff's mark; 2) the similarity between the plaintiff's and defendant's marks; 3) the degree to which the allegedly infringing product competes with the plaintiff's goods; 4) the alleged infringer's intent to confuse the public; 5) the degree of care reasonably expected of potential customers; and 6) evidence of actual confusion.
Roederer v. J. Garcia Carrion, S.A., 569 F.3d 855, 860 (8th Cir. 2009). These factors do not operate as a precise test, but instead represent the type of considerations a court should examine when determining likelihood of confusion. Duluth News-Tribune, 84 F.3d at 1096. Accordingly, the Court considers each factor in turn.
Defendants argue that Plaintiff's CarShield marks are "generic and weak" because and use of the word "car" in the automotive service industry is non-distinctive and Plaintiff did not register any associated logos, arrangements, or colors. (ECF No. 12 at 3). Additionally,Defendant notes that Plaintiff did not allege marketplace recognition of its mark. (Id. at 5).
"A strong and distinctive trademark is entitled to greater protection than a weak or commonplace one." Frosty Treats Inc. v. Sony Computer Ent. Am. Inc., 426 F.3d 1001, 1008 (8th Cir. 2005) (quoting SquirtCo. v. Seven-Up Co., 628 F.2d 1086, 1091 (8th Cir. 1980)). "Two relevant measurements of a mark's strength are its conceptual strength and its commercial strength." Lovely Skin, Inc. v. Ishtar Skin Care Prods., LLC, 745 F.3d 877, 888 (8th Cir. 2014) (citation omitted). Evidence of a plaintiff's advertising expenditures and revenues over time are relevant factors in evaluating a mark's strength. See id.
In its complaint, Plaintiff alleges that it devoted substantial resources to "building the CARSHIELD brand in the vehicle service contract market" and to the "marketing, advertising, and promotion of the CARSHIELD Marks in connection with selling vehicle services contracts." (ECF No. 1 at ¶¶ 3, 24). Plaintiff states that it displays the CarShield marks on its website, www.carshield.com, and uses the mark in print, television, and radio advertisements. (Id. at ¶¶ 25-26). Exhibits attached to Defendants' motion to dismiss contain a photograph of the CarShield mark on the baseball stadium where the River City Rascals play and an online advertisement for CarShield with a photograph of Mike Ditka, "Hall of Famer & Coach." (ECF No. 12-2).
In ruling on a motion to dismiss, the Court accepts all factual allegations and draws all reasonable inferences in favor of the Plaintiff. Crooks v. Lynch, 557 F.3d 846, 848 (8th Cir. 2009). Based on Plaintiff's allegations relating to the advertising, marketing, and promotion of its CarShield marks, the Court may reasonably infer that the mark enjoys a degree of commercial strength. Therefore, Plaintiff alleged sufficient facts to make the strength of its mark plausible.3
Defendants contend that Plaintiff fails to plead sufficient facts to establish a similarity between the marks. (ECF No. 12 at 5-8). "The use of identical, even dominant, words in common does not automatically mean that two marks are similar." General Mills, Inc. v. Kellogg Co., 824 F.2d 622, 627 (8th Cir. 1987). "Rather, in analyzing the similarities of sight, sound, and meaning between two marks, a court must look to the overall impression created by the marks and not merely compare individual features." Id.
In its complaint, Plaintiff states that the CarShield and CarSure marks are "confusingly similar" and therefore "likely to cause confusion among consumers as to the source of the vehicle services advertised and sold." (ECF No. 1 at ¶¶ 31-34). Specifically, Plaintiff alleged that the marks are similar in: (1) "appearance, as both begin with the word 'car' followed by a word beginning with 's,' are displayed as one word with the 'C' and the 'S' capitalized, and use similar shades of blue"; (2) "sound, as both begin with the word 'car' followed by a word that begins with a 'sh' sound"; and (3) "meaning, as both marks suggest a sense of...
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