Paleteria La Michoacana, Inc. v. Productos Lacteos Tocumbo S.A. De C.V.

• Decision Date: 03 February 2015
• Docket Number: Civil Action No. 11–1623 RC
• Citation: 79 F.Supp.3d 60
• Court: U.S. District Court — District of Columbia
• Parties: Paleteria La Michoacana, Inc. et al., Plaintiffs & Counter–Defendants, v. Productos Lacteos Tocumbo S.A. De C.V., Defendant & Counter–Claimant.

79 F.Supp.3d 60

Paleteria La Michoacana, Inc. et al., Plaintiffs & Counter–Defendants

v.Productos Lacteos Tocumbo S.A. De C.V., Defendant & Counter–Claimant.

Civil Action No. 11–1623 RC

United States District Court, District of Columbia.

Signed February 3, 2015

Ariel Fox Johnson, Common Sense Media, Karin H. Johnson, Sheppard, Mullin, Richter & Hampton LLP, Washington, DC, Laura L. Chapman, Sheppard, Mullin, Richter & Hampton, LLP, Wendy M. Garbers, Morrison & Foerster LLP, San Francisco, CA, for Plaintiffs & Counter–Defendants.

Steven Michael War, McNeely, Hare & War LLP, Washington, DC, Stephen L. Anderson, Anderson & Associates, Temecula, CA, for Defendant & Counter–Claimant.

Re Document No.: 144

MEMORANDUM OPINION

Denying Defendant/Counter–Claimant's Motion for Reconsideration of the Court's Summary Judgment Memorandum Opinion

RUDOLPH CONTRERAS, United States District Judge

I. INTRODUCTION

Now before the Court is Defendant/Counter–Claimant Productos Lacteos Tocumbo S.A. De C.V.'s (“PROLACTO”) motion for reconsideration of this Court's September 25, 2014, Memorandum Opinion that granted in part and denied in part separate motions for summary judgment filed by PROLACTO and Plaintiffs/Counter–Defendants Paleteria La Michoacana, Inc. and Paleteria La Michoacana, LLC (collectively, “PLM”). Through its motion, PROLACTO seeks reversal of two judgments made by the Court: first, that PROLACTO was not entitled to any form of monetary relief for its counterclaims; and second, that PROLACTO failed to demonstrate substantial familiarity with its marks within any relevant American consumer market such that the famous mark doctrine, if adopted as the law by this Court, would not apply to establish priority for those marks. Upon consideration of PROLACTO's motion and the memoranda in support thereof and opposition thereto, the Court will deny the motion for reconsideration as to both issues.

II. BACKGROUND

This long-running trademark dispute first arrived before the Court when PLM brought suit against PROLACTO challenging a decision by the Trademark Trial and Appeal Board (“TTAB”) regarding various registered and unregistered trademarks used to sell Mexican-style ice cream bars, called paletas, and other frozen ice cream treats.¹ PROLACTO responded to PLM's lawsuit by filing a counterclaim that asserted several counts against PLM under various sections of the Lanham Act, 15 U.S.C. § 1051 et seq., as well as District of Columbia common law. PLM and PROLACTO then each filed a motion for summary judgment in which they sought a ruling on nearly all of the counts in the complaint and counterclaim. See generally PLM's Mot. Part. Summ. J., ECF No. 114; PROLACTO's Mot. Part. Summ. J., ECF No. 116. This Court, in a lengthy Memorandum Opinion dated September 25, 2014 (the “Memorandum Opinion”), granted in part and denied in part each party's motion.² See generally Paleteria La Michoacana, Inc. v. Productos Lacteos Tocumbo S.A. De C.V. (“PLM I ”), No. CV 11–1623(RC), ––– F.Supp.3d ––––, 2014 WL 4759945 (D.D.C. Sept. 25, 2014) (ECF No. 137).

PROLACTO now has filed a motion for reconsideration pursuant to Federal Rule of Civil Procedure 54(b) challenging the Memorandum Opinion's conclusions as to two issues. See generally PROLACTO's Mem. Supp. Mot. Reconsid., ECF No. 144–1. First, PROLACTO objects to the Court's ruling that PROLACTO “fail[ed] to provide evidence demonstrating sufficient familiarity with the marks in any relevant United States market, let alone across the entire country,” such that the famous mark doctrine, if it were adopted by this Court, would not apply to establish priority of PROLACTO's marks. See PLM I, ––– F.Supp.3d at ––––, ––––, 2014 WL 4759945, at *14. PROLACTO now argues that the Court “misunderstood” its arguments about the famous mark doctrine, “misstated” the appropriate legal standard for the doctrine, and failed to consider evidence that established that PROLACTO had achieved sufficient familiarity with its marks in at least one American consumer market—namely, “Mexican immigrants (and travelers who have visited Mexico) seeking authentic Mexican-style paletas.” PROLACTO's Mem. Supp. Mot. Reconsid., ECF No. 144–1, at 14–16.

Second, PROLACTO challenges the Court's decision to grant summary judgment in favor of PLM on the question of whether the equitable defenses of laches, acquiescence, and estoppel prohibited PROLACTO from recovering any form of monetary relief, including PLM's profits, if PROLACTO were to succeed on any of its counterclaim theories. See PLM I, ––– F.Supp.3d at ––––, –––– – ––––, 2014 WL 4759945, at *32–33. The Court made this determination primarily on the basis that PROLACTO, in its opposition to PLM's motion for summary judgment, ignored the monetary recovery issues, including whether there was sufficient evidence of actual damages and whether equitable principles prohibited the Court from awarding any monetary relief to PROLACTO. See id . PROLACTO now argues, however, that the Court erred in granting summary judgment for PLM because PLM had failed to meet its initial burden of proof as to the acquiescence, equitable estoppel, and laches defenses, and as such, the Court should have denied PLM's motion for summary judgment irrespective of PROLACTO's failure to oppose PLM's motion.See PROLACTO's Mem. Supp. Mot. Reconsid., ECF No. 144–1, at 6–12. The Court addresses these issues and others below.

III. LEGAL STANDARD

Because PROLACTO seeks reconsideration of an interlocutory order, Rule 54(b) governs the Court's analysis. See Judicial Watch v. U.S. Dep't of Army, 466 F.Supp.2d 112, 123 (D.D.C.2006) (discussing Rule 54(b)'s application to denials of dispositive motions). Rule 54(b) is silent, however, on the standard of review applicable to motions for reconsideration of such interlocutory decisions and orders. “To fill this gap, courts in this district have held that ‘relief upon reconsideration [of an interlocutory decision] pursuant to Rule 54(b) is available as justice requires.’ ” United States v. Coughlin, 821 F.Supp.2d 8, 18 (D.D.C.2011) (quoting Hoffman v. District of Columbia, 681 F.Supp.2d 86, 90 (D.D.C.2010) ). Under the “as justice requires” standard, reconsideration may be warranted when a court has “patently misunderstood the parties, made a decision beyond the adversarial issues presented, made an error in failing to consider controlling decisions or data, or where a controlling or significant change in the law has occurred.” U.S. ex rel. Westrick v. Second Chance Body Armor, Inc., 893 F.Supp.2d 258, 268 (D.D.C.2012) (internal citation, quotation, and alteration omitted); see also Cobell v. Norton, 224 F.R.D. 266, 272 (D.D.C.2004).

“These considerations leave a great deal of room for the court's discretion and, accordingly, the ‘as justice requires' standard amounts to determining ‘whether [relief upon] reconsideration is necessary under the relevant circumstances.’ ” Lewis v. District of Columbia, 736 F.Supp.2d 98, 102 (D.D.C.2010) (quoting Cobell, 224 F.R.D. at 272 ). But at the same time, a court's discretion under Rule 54(b) is “limited by the law of the case doctrine and subject to the caveat that where litigants have once battled for the court's decision, they should neither be required, nor without good reason permitted, to battle for it again.” Singh v. George Washington Univ., 383 F.Supp.2d 99, 101 (D.D.C.2005) (citations omitted). A court therefore may deny a motion for reconsideration when it merely asserts “ ‘arguments for reconsideration [that] the court ha[s] ... already rejected on the merits.’ ” McLaughlin v. Holder, 864 F.Supp.2d 134, 141 (D.D.C.2012) (quoting Capitol Sprinkler Inspection, Inc. v. Guest Servs., Inc., 630 F.3d 217, 227 (D.C.Cir.2011) ). Finally, “[t]he burden is on the moving party to show that reconsideration is appropriate and that harm or injustice would result if reconsideration were denied.” Second Chance Body Armor, 893 F.Supp.2d at 268 (citing Husayn v. Gates, 588 F.Supp.2d 7, 10 (D.D.C.2008) ).

IV. ANALYSIS

A. Reconsideration Of The Court's Judgment As To The Famous Mark Doctrine

As the Court explained in the Memorandum Opinion, the controversial and rarely-adopted famous mark doctrine allows a trademark to be deemed so well-known in a particular American market—despite no actual commercial use in the market—that the historic territoriality principle is disregarded and priority is established instead through reputation in the United States rather than actual use, as the territoriality principle otherwise requires. See PLM I, ––– F.Supp.3d at ––––, ––––, 2014 WL 4759945, at *12 (citing Grupo Gigante SA De CV v. Dallo & Co., Inc., 391 F.3d 1088, 1094 (9th Cir.2004) ). Thus, the gist of the famous mark doctrine is that “even those who use marks in other countries can sometimes—when their marks are famous enough—gain exclusive rights to the marks in this country.”Id . (citing Grupo Gigante, 391 F.3d at 1095 ). To date, the Court remains aware of this narrow exception to the territoriality principle having been adopted only within the Ninth Circuit and in a handful of TTAB opinions, see id . (citing cases), and the doctrine without question has never been accepted as the law by any court in this Circuit. See, e.g ., id . at *15 , ––– F.Supp.3d at ––––, –––– (discussing the famous mark doctrine but ultimately concluding that the Court “need not determine whether the doctrine should be recognized because the facts of this case are insufficient to warrant further judicial inquiry”); Aktieselskabet AF 21. Nov. 2001 v. Fame Jeans, Inc., 511 F. Supp. 2d 1, 11–12 (D.D.C.2007), aff'd in part, rev'd in part, 525 F.3d 8 (D.C.Cir.2008) ( “No court in the District of Columbia Circuit has yet considered whether the famous marks doctrine operates to secure priority of use in the United States to a foreign user, and this Court need not do so here.”).

In Counterclaim Count II, PROLACTO asserts that PLM violated Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a),...