Falcon Stainless, Inc. v. Rino Companies, Inc. et al, No. 8:2008cv00926 - Document 32 (C.D. Cal. 2008)

Court Description: FINDINGS OF FACT AND CONCLUSIONS OF LAW and ORDER IN SUPPORT OF ORDER DENYING IN PART AND GRANTING IN PART PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION 3 signed by Judge Alicemarie H. Stotler. (See Order for details) (db)

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Falcon Stainless, Inc. v. Rino Companies, Inc. et al Doc. 32 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 12 13 14 15 16 SOUTHERN DIVISION FALCON STAINLESS, INC., ) ) Plaintiff, ) ) v. ) ) RINO COMPANIES, INC., etc., ) et al., ) ) ) Defendants. ) _____________________________) SA CV 08-926 AHS (MLGx) FINDINGS OF FACT AND CONCLUSIONS OF LAW IN SUPPORT OF ORDER DENYING IN PART AND GRANTING IN PART PLAINTIFF’S MOTION FOR PRELIMINARY INJUNCTION; ORDER THEREON 17 18 I. 19 INTRODUCTION 20 Having considered the Complaint and the papers in 21 support of the motion for preliminary injunction (the “Motion”) 22 filed by Plaintiff FALCON STAINLESS INC. (“Falcon” or 23 “plaintiff”), the declarations and exhibits submitted therewith 24 and the reply papers, the opposition papers submitted by 25 Defendants RINO COMPANIES, INC., PERFORMANCE SALES, INC., 26 SOUTHSEA METAL INC., John NOVELLO, and Harry REIGER 27 (collectively, “Rino” or “defendants”) and the declarations and 28 exhibits submitted therewith, arguments of counsel, and all Dockets.Justia.com 1 pleadings on file in this action, the Court makes the following 2 findings of fact and conclusions of law in support of its order 3 to grant in part and deny in part plaintiff’s motion for a 4 preliminary injunction. 5 II. 6 SUMMARY OF PLAINTIFF’S GROUNDS FOR RELIEF 7 Falcon moves for preliminary injunctive relief on the 8 following four grounds: 9 1. 10 11 12 13 Rino engaged in false advertising in asserting that the Rino products meet ASME A112.18.6 standards; 2. Rino engaged in false advertising in asserting that Rino connectors exceed the flow rate of Falcon’s connectors; 3. Rino engaged in trademark infringement by using on 14 its connectors a numbering system confusingly similar to the 15 numbering system used on Falcon connectors; and 16 4. Rino engaged in trademark infringement by using on 17 its connectors a square with the letter “S” inside (the “‘S’ 18 mark”) that is allegedly confusingly similar to the diamond with 19 the letter “F” inside (the “diamond “F” mark”) used on Falcon’s 20 connectors. 21 No other bases for preliminary injunctive relief are 22 properly before this Court as the Court noted at the November 3, 23 2008 hearing.1 24 25 For the reasons identified below, the Court denies Falcon’s motion for injunctive relief on all grounds except for 26 1 27 28 District courts need not consider arguments raised for the first time in the reply brief. Zumani v. Carnes, 491 F.3d 990, 997 (9th Cir. 2007). 2 1 Rino’s advertisement that its connectors flow more water than 2 Falcon’s connectors. 3 III. 4 FINDINGS OF FACT 5 A. 6 ASME A112.18.6 Facts 1. The International Association of Plumbing and 7 Mechanical Officials (“IAPMO”) regulates and sets the standards 8 for plumbing products in the United States. 9 Wolff Decl. ¶ 8. 10 11 2. Rino and Falcon believe that IAPMO’s approval is critical to business success. 12 3. Novello Decl. ¶ 4; Wolff Decl. ¶ 8. IAPMO verifies compliance with industry standards, 13 including standard A112.18.6 of the American Society of 14 Mechanical Engineers (“ASME”). 15 Decl. Ex. A. 16 pursuant to § 3.4, water heater connectors, “metallic water 17 heater connector tubes shall be 300 series stainless steel, 0.010 18 in. (0.25 mm) minimum wall thickness. . . .” 19 p. 23. 20 Standards Organizations, Societies and Associations.” 21 Decl. ¶ 2 & Ex. A.) 22 23 ASME A112.18.6 provides, in relevant part, that Wolff Decl. Ex. A. IAPMO is recognized by ASME as one of the “US Engineering 4. 5. (Rieger Decl. ¶ 4 & Ex. B.) Rino advertises its compliance with ASME A112.18.6 25 by pointing to IAPMO’s verification of compliance. 26 Ex. G.) 27 28 6. the industry. (Rieger Falcon advertises on its website IAPMO’s verification of its products. 24 See Novello Decl. ¶ 4; Wolff (Wolff Decl. Pointing to IAPMO’s certification is standard in (Novello Decl. ¶ 4; Rieger Decl. ¶ 3.) 3 7. 1 IAPMO has certified Rino’s connectors and found 2 them to be in compliance with ASME A112.18.6. 3 5 & Exs. A & B; Rieger Decl. ¶ 5. 4 tested a sample pipe from Rino and concluded the product complied 5 with ASME A112.18.6. 8. 6 Novello Decl. ¶ 4- Moreover, an IAPMO auditor (Novello Decl. ¶ 5 & Ex. B.) Falcon hired third party, Stork Materials Testing 7 & Inspection, Inc. (“Stork”), to test some of Rino’s connectors, 8 and Stork concluded that the connectors it tested are not ASME 9 A112.18.6 compliant. 10 B. 11 12 (See Riley Decl.) Water Flow Facts 9. Maximum water flow is a highly desirable characteristic for water connectors. 13 10. (Wolff Decl. ¶ 6.) Rino’s Chinese testing laboratory showed a flow 14 rate of 7.238 gallons per minute from its tests. 15 ¶ 8 & Ex. F, entry number “3” on the English portion of the 16 chart.) 17 Wolff Decl. Ex. C.) 18 flow rate of 1.623 meters per second. 19 to feet per second using the conversion formula of 1 meter to 20 3.2808399 feet. 21 yields 5.32 feet per second water velocity (1.623 x 3.28 = 5.32). 22 (Novello Decl. Rino rounded 7.238 to 7.24 in its advertisement. 11. (Supp. Rino’s test results were based upon a water Id. This can be converted (See Supp. Wolff Decl. ¶ 20.) The calculation In contrast, Falcon’s test results were based upon 23 a test with an initial water velocity of 5 feet per second. 24 (Supp. Wolff Decl. ¶ 20.) 25 gallons per minute as advertised by Falcon. 26 Ex. E.) 27 28 12. This yielded a flow rate of 6.345 (Novello Decl. ¶ 8 & Rino’s advertisement uses Falcon’s advertised flow rate of 6.345 gallons per minute (see Novello Decl. ¶ 8 & Ex. E) 4 1 and Rino’s flow rate, as tested by the Chinese laboratory, at 2 7.24 gallons per minute. 3 Ex. F). 13. 4 (Wolff Decl. Ex. E; Novello Decl. ¶ 8 & Falcon hired Garwood laboratories to conduct a 5 comparison test of its water connectors with Rino’s water 6 connectors. 7 two companies’ water connectors under standardized pressures, 8 ambient conditions, and time measurements. 9 A. p. 10-12.) (Bellanca Decl. ¶ 3.) The test compared four of the (Bellanca Decl. Ex. The tests showed under 60 psig the Rino 3/4” 10 connector flowed 22.28 GPM and the Falcon 3/4” connector flowed 11 22.29 GPM. 12 connector flowed 22.27 GPM and Falcon’s 1” connector flowed 22.32 13 GPM. 14 conditions, Falcon’s water connectors do not flow less water than 15 Rino’s water connectors. 16 claimed flow rate from its Chinese test. 17 C. (Id.) 18 19 The tests showed that under 60 psig, Rino’s 1” Thus, the tests show that under standardized The test does not substantiate Rino’s Numbering System Facts 14. Falcon does not have a state or federally registered trademark on its numbering system. 20 21 (Id.) 15. Falcon does not use its numbering system in its advertisements or on its website. 22 16. (Novello Decl. ¶ 9.) Most of the sales for both Falcon and Rino are 23 made to sophisticated retailers and plumbing companies with a 24 strong knowledge of the industry and the products available 25 therein. 26 Associates customer), ¶ 27 (Ferguson Enterprises customer, the 27 largest plumbing wholesale distributor in the world), ¶ 36 28 (Express Pipe & Co. customer), ¶ 37 (The Plumber’s Warehouse (Novello Decl. ¶ 3; Wolff Decl. ¶ 3, ¶ 21-22 (Ramey & 5 1 customer)). 17. 2 Falcon and Rino both use numerical bar codes on 3 their connectors. 4 designed to identify the diameter and length of the given 5 connectors. 6 Rino serves the same purpose. (Wolff Decl. ¶ 30.) 18. 7 The numbering system used by Falcon is The numbering system used by (Novello Decl. ¶ 9.) The prefix letters Falcon uses on its flexible 8 connectors are either FF or SWC. 9 places a space between its letters and the following numbers. 10 11 (Wolff Decl. ¶ 31.) Falcon (Id.) 19. The prefix letters Rino uses on its flexible 12 connectors are SWF. 13 spaces between those letters and the numbers that follow. 14 20. (Wolff Decl. ¶ 31.) Rino does not have any (Id.) As to the numbers on products, the identical 15 numbers as between Falcon and Rino are as follows: 16 of 13418 and 13425 for the 1” by 3/4” product; (b) the use of 17 11418 and 11424 for the 1 1/4” pipe; and (c) the use of 11218 and 18 11224 for the 1 1/2” pipe. 19 before these numbers, Falcon uses SWC and Rino uses SWF. 20 21. (Wolff Decl. ¶ 31.) (a) the use As a prefix The non-identical numbers are as follows: (Id.) (a) 21 Falcon uses FF 34015, FF 34018, FF 34024 but Rino uses SWF3415, 22 SWF3418, SWF3424 for the 3/4” pipe; (b) Falcon uses SWC 10012, 23 SWC 10018 and SWC 10024, and Rino uses SWF112, SWF118 and SWF 124 24 for the 1” by 1” pipe; and (c) Falcon uses SWC 20018 and SWC 25 20024 and Rino uses SWF218 and SWF224 for the 2” pipes. 26 Decl. ¶ 31.) 27 28 22. (Wolff For the Falcon products in the preceding paragraph (3/4”, 1” x 1” and 2” products), Falcon places a “0” between the 6 1 dimension numbers. (Wolff Decl. ¶ 31.) For the comparable Rino 2 products, Rino does not place a “0” between the dimension 3 numbers. (Id.) 4 23. The numerical bar code numbering system is used by 5 Rino because it is functional and is further required by Ferguson 6 Enterprises, a significant buyer of water connectors. 7 Decl. ¶ 9.) 8 Ferguson’s business without using the numerical system about 9 which Falcon complains. 10 D. (Novello Thus, Rino could not compete with Falcon for (Id. ¶ 14.) Geometric Shape and Letter Facts 11 24. Falcon places on its connectors its diamond “F” 12 mark. (Wolff Decl. ¶ 9.) 13 of less than 90 degrees and two angles of more than 90 degrees. 14 (Novello Decl. Ex. D.) 15 the connectors because IAPMO requires certain identifying 16 information. 17 18 25. Falcon’s diamond shape has two angles Falcon places this notation on the end of (Wolff Decl. ¶ 9.) Falcon’s letter “F” is not stylized in any manner; it is simply the capital “F.” 19 26. (Novello Decl. Ex. D.) Rino places on its connectors the letter “S” (for 20 Southsea Metal, Inc., the manufacturer) inside a rotated square. 21 Rino’s shape is four angles of 90 degrees each. 22 11 Ex. D.) 23 because IAPMO requires it. 24 (Novello Decl. ¶ Rino, like Falcon, puts a notation on its connectors 27. (Id. ¶ 10.) The shapes used by Falcon and Rino are different 25 because Rino uses a square and Falcon uses a diamond. 26 Decl. ¶¶ 10-11 & Ex. D.) 27 28. 28 (Novello The letters used by Falcon and Rino are different because Rino uses a letter “S” and Falcon uses the letter “F.” 7 1 (Novello Decl. ¶¶ 10-11 & Ex. D.) 2 customer having ever been confused as between the diamond “F” and 3 square “S” marks. 29. 4 Rino is not aware of any (Novello Decl. ¶ 11.) There is at least one other company in the water 5 connector industry, BrassCraft, that also places diamonds on its 6 water connectors in the same location that Falcon places its 7 diamond and Rino places its square. 30. 8 9 Novello Decl. ¶ 12. Falcon does not have a state or federally registered trademark on its diamond “F” mark. There is no 10 evidence that Falcon uses the diamond “F” mark in its advertising 11 of its connectors. 12 IV. 13 CONCLUSIONS OF LAW 14 A. 15 General Preliminary Injunction Standards 31. “A plaintiff seeking a preliminary injunction must 16 establish that he is likely to succeed on the merits, that he is 17 likely to suffer irreparable harm in the absence of preliminary 18 relief, that the balance of equities tips in his favor, and that 19 an injunction is in the public interest.” 20 Def. Council, Inc., – U.S. - , 129 S. Ct. 365, 376, 67 ERC 1225 21 (2008). 22 32. Winter v. Natural Res. Before a court may issue a preliminary injunction, 23 the movant should post a bond “in an amount that the Court 24 considers proper to pay the costs and damages sustained by any 25 party found to have been wrongfully enjoined or restrained.” 26 Fed. R. Civ. P. 65(c). 27 concludes there is no realistic likelihood of harm to a defendant 28 from enjoining his or her conduct. A court may dispense with a bond when it 8 Jorgensen v. Cassidy, 320 F. 1 3d 906, 919 (9th Cir. 2003). 2 B. Falcon’s Likelihood of Prevailing on the Merits 3 i. General Lanham Act False Advertising Law 4 33. “The elements of a Lanham Act § 43(a) false 5 advertising claim are: (1) a false statement of fact by the 6 defendant in a commercial advertisement about its own or 7 another’s product; (2) the statement actually deceived or has the 8 tendency to deceive a substantial segment of its audience; (3) 9 the deception is material, in that it is likely to influence the 10 purchasing decision; (4) the defendant caused its false statement 11 to enter interstate commerce; and (5) the plaintiff has been or 12 is likely to be injured as a result of the false statement, 13 either by direct diversion of sales from itself to defendant or 14 by a lessening of the goodwill associated with its products.” 15 Southland Sod Farms v. Stover Seed Co., 108 F.3d 1134, 1139 (9th 16 Cir. 1997). 17 Lanham Act, a plaintiff may show that the statement was literally 18 false, either on its face or by necessary implication, or that 19 the statement was literally true but likely to mislead or confuse 20 consumers.” 21 “To demonstrate falsity within the meaning of the Id. 34. Regarding Court determinations of advertisements 22 involving certifications from regulatory entities, there must be 23 a clear and unambiguous statement from the licensing body about 24 these regulations and certifications. 25 Inc. v. First Am. Title Ins. Co., 173 F.3d 725, 731 (9th Cir. 26 1999). 27 28 35. Coastal Abstract Serv., Regarding advertisements involving comparisons of products, “a plaintiff must do more than show that the tests 9 1 supporting the challenged claim are unpersuasive.” 2 Sod, 108 F.3d at 1139. 3 tests are not sufficiently reliable to support the results 4 claimed. 5 validity of the defendant’s tests or by demonstrating that other 6 tests contradict or do not support defendant’s tests. 7 Additionally, the publication of false comparative claims gives 8 rise to a presumption of actual deception and reliance. 9 1146. Id. 10 36. The plaintiff must demonstrate that the The plaintiff can do this either by attacking the a. 11 Southland Falcon fails to demonstrate that it is likely to succeed on the merits of its claim regarding Rino’s 13 advertisements that state that it is ASME compliant. 37. Id. at Falcon’s ASME Compliance Argument 12 14 Id. Falcon fails to show that Rino’s advertisement 15 that Rino is ASME certified is literally false. 16 evidence from IAPMO – an entity who all parties agree is the 17 governing body for setting standards regarding plumbing products 18 – whereby it certified that Rino’s products are ASME A112.18.6 19 compliant. 20 38. Rino has offered Falcon does not provide evidence that demonstrates 21 that IAPMO’s certification of Rino’s products is invalid or 22 false, thus, plaintiff is not entitled to an injunction 23 prohibiting Rino from advertising the results it received from 24 IAPMO. 25 26 27 28 39. Thus, the Court does not reach Rino’s unclean hands defense. 40. Consequently, the Court concludes that Falcon fails to satisfy its burden that it will prevail on the merits of 10 1 its claim that Rino’s advertisement of its ASME 112.18.6 2 certification is false. b. 3 41. 4 Falcon’s Water Flow Rate Argument Falcon has made a showing that it may prevail on 5 the merits of its claim that Rino’s statements that its water 6 connectors flow more water than Falcon’s water connectors is 7 false. 42. 8 9 Falcon requests an injunction prohibiting Rino from advertising that it has faster water flow rates. Rino’s 10 advertisement notes Rino’s 7.24 GPM and Falcon’s 6.345 GPM flow 11 rates. 12 Falcon’s test evidence shows that Rino’s test results are 13 unreliable in two ways: (1) Rino’s test was not a controlled 14 comparison test and (2) its own set of controlled tests directly 15 contradict Rino’s test results. 16 Falcon agrees that it advertised the 6.345 GPM result. 43. There is no indication (or complete translation) 17 that the Chinese testing lab on which Rino relied for its water 18 flow measurement (Novello Decl. Ex. F) conducted a test that 19 controlled for variables in order to conduct an accurate 20 comparison between the two products. 21 that Rino’s test used a higher water velocity than that used in 22 Falcon’s test, which would necessarily result in a higher flow 23 rate. 24 Falcon water connector with the same water velocity to conduct a 25 valid comparison. 26 have a higher flow rate is not based on any comparison testing. 27 28 In fact, both parties agree Additionally, there is no evidence that Rino’s test used a 44. Rather, Rino’s advertisement that its products Falcon’s evidence provides what Rino did not: a comparison test that controls for variables and uses the same 11 1 water velocities. 2 statistically significant information about which companies’ 3 water connectors flow faster, it does show that Rino’s 4 advertisement rests on a test that is contradicted by other 5 tests. 6 45. While the results may not provide Falcon meets its burden at the preliminary 7 injunction stage of showing that Rino’s test is not reliable and 8 that other tests directly contradict it. 9 demonstrates a likelihood of prevailing on the merits on its 10 Thus, Falcon claim that Rino’s comparison advertisements are false. 11 ii. General Lanham Act Trademark Law Principles 12 46. To establish its trademark infringement claims, 13 Falcon must show: 14 likelihood of confusion arising out of defendants’ use of 15 confusingly similar marks. 16 202 F.3d 1199, 1205 (9th Cir. 2000). 17 47. (1) protectable rights in its marks and (2) a GoTo.com, Inc. v. Walt Disney Co., Unregistered marks do not receive a presumption of 18 secondary meaning. 19 Co., 966 F.2d 1284, 1287 (9th Cir. 1992). 20 are unregistered and, accordingly, Falcon is not entitled to any 21 presumption of secondary meaning. 22 48. See Americana Trading, Inc. v. Russ Berrie & Falcon’s alleged marks “Trademarks are generally divided into five 23 categories: (1) generic; (2) descriptive; (3) suggestive; (4) 24 arbitrary; and (5) fanciful.” 25 Lasting Impression I, Inc., 408 F.3d 596, 602 (9th Cir. 2005). 26 “The latter three categories are deemed inherently distinctive 27 and are automatically entitled to protection because they 28 naturally serve to identify a particular source of a product.” KP Permanent Make-Up, Inc. v. 12 1 Id. (internal citations omitted). 2 49. If a mark is generic, it lacks distinction and, 3 therefore, should not receive trademark protection. 4 Co. of Sacramento v. Yellow Cab of Elk Grove, Inc., 419 F.3d 925, 5 927 (9th Cir. 2005). 6 fact. 7 courts “look to whether consumers understand the word to refer 8 only to a particular producer’s goods or whether the consumer 9 understands the word to refer to the goods themselves.” Id. at 929. Yellow Cab Whether a mark is generic is a question of To determine whether a mark is generic, Id. If 10 a mark is not generic but merely descriptive, then it may receive 11 protection only if secondary meaning provides it with 12 distinctiveness. 13 50. KP Permanent, 408 F.3d at 602. Secondary meaning is a question of fact. Vision 14 Sports, Inc. v. Melville Corp., 888 F.2d 609, 614 (9th Cir. 15 1989). 16 associates a mark with a particular source code. 17 assess secondary meaning include: 18 associate the product with the trademark; (2) the degree and 19 manner of use of the trademark; and (3) whether the use of the 20 trademark has been exclusive. 21 Secondary meaning is present when the purchasing public 51. Id. Factors to (1) whether actual purchasers Id. at 615. Thus, to establish secondary meaning, a plaintiff 22 must show an actual association between the mark and the seller 23 in a substantial portion of the relevant market. 24 Yellow Cab, 419 F.3d at 930. 25 52. See, e.g., The most significant evidence of secondary meaning See Vision Sports, 888 F.2d at 615 (“An 26 is survey evidence. 27 expert survey of purchasers can provide the most persuasive 28 evidence of secondary meaning.”). 13 a. 1 53. 2 Falcon’s Numbering System Trademark Claim Falcon fails to demonstrate a likelihood of 3 prevailing on the merits of its claim that Rino is infringing on 4 Falcon’s part numbering system because Falcon does not 5 demonstrate that it has a protectable trademark interest in its 6 system. 54. 7 Under the functional use doctrine, parts of a 8 design that have a functional use may not receive any trademark 9 protection. See Playboy Enter. v. Netscape Commc’n Corp., 354 10 F.3d 1020, 1030 (9th Cir. 2004). 11 applies to words. 12 Inc., 908 F. Supp. 1409, 1423 (S.D. Tex. 1995) (finding that 13 words may be functional and that use of the word “Compaq” as an 14 identifier was functional in case at hand). 15 functional if it relates to basic consumer demands with the 16 product. 17 769, 773 (9th Cir. 1981). 18 The functionality doctrine See Compaq Computer Corp. v. Procom Tech., A design element is Vuitton et Fils S.A. v. J. Young Enters. Inc., 644 F.2d 55. “[A] trademark is functional when it is essential 19 to the use or purpose of the device or when it affects the cost 20 or quality of the device.” 21 Beverage Co., 349 F.3d 601, 603-05 (9th Cir. 2003) (finding a 22 bottle design functional and hence not trademark protected). 23 determine functionality, courts consider four factors: 24 whether the advertising touts the utilitarian advantages of the 25 design; (2) whether the design results from a comparatively 26 simple or inexpensive method of manufacture; (3) whether the 27 design yields a utilitarian advantage; and (4) whether 28 alternative designs are available. Talking Rain Beverage Co. v. S. Beach 14 Id. at 603. To (1) 56. 1 2 Falcon bears the burden of proof of establishing that its alleged mark is nonfunctional. 3 57. See id. Falcon’s numbering system is utilitarian because 4 it identifies the size and dimensions of the pipe. While there 5 are alternative designs available, for example Rino inserts a “0” 6 between some of its numbers, the system remains utilitarian 7 because it identifies the parts that it is marking. 8 admits that it uses the numbering system in response to consumer 9 demand. Also, Falcon Thus, Falcon’s numbering system is functional, and the 10 numbering system is not subject to trademark protection under the 11 Lanham Act. 12 at 1423. 13 Playboy Ent., 354 F.3d at 1030; Compaq, 908 F. Supp. 58. Because the numbering system is not a protectable 14 trademark, the Court need not assess whether the numbering system 15 has secondary meaning. 16 Because Falcon lacks a protectable trademark, the Court need not 17 determine whether there is a likelihood of confusion arising from 18 Rino’s use of its numbering system. 19 1205. 20 59. See Talking Rain, 349 F.3d at 605. See GoTo.com, 202 F.3d at Falcon fails to satisfy its burden of a likelihood 21 of success on the merits of its claim that Rino’s part numbering 22 system infringes on Falcon’s part numbering system. 23 fails to identify clearly which subset of the numbering system it 24 seeks to enjoin under trademark infringement principles, so the 25 Court considers Falcon’s challenge to be against all the part 26 numbers used by Rino as shown by the evidence submitted to the 27 Court. 28 // 15 Falcon also b. 1 60. 2 Falcon’s Diamond “F” Trademark Claims Falcon fails to demonstrate that it has a 3 protectable trademark interest in its diamond “F” mark and 4 therefore cannot establish a likelihood of prevailing on the 5 merits of its claim that Rino’s “S” mark infringes on the diamond 6 “F” mark. 7 61. Common basic shapes or letters are not distinctive 8 and need proof of secondary meaning. See Louis Vuitton Malletier 9 v. Dooney & Bourke, Inc., 454 F.3d 108, 116 (2d Cir. 2006) 10 (“Basic geometric shapes, basic letters and single colors are not 11 protectable as inherently distinctive. . . . 12 be protected only upon a showing of secondary meaning.”); Star 13 Indus., Inc. v. Bacardi & Co., 412 F.3d 373, 382-83 (2d Cir. 14 2005) (“O” shape not inherently distinctive, but a stylized “O” 15 that is more than “a simple linear representation of an ellipse 16 or the letter ‘O’ can acquire secondary meaning but even then is 17 a weak mark, which will be entitled to only limited 18 protection.”); Brooks Show Mfg. Inc. v. Suave Shoe Corp., 716 19 F.2d 854, 858 (11th Cir. 1983) (“V” is a basic geometric shape 20 that is not inherently distinctive). 21 62. These symbols may The diamond “F” mark is not an arbitrary or 22 fanciful designation; the diamond is a basic shape and the letter 23 “F” is unstylized and the first letter of Falcon’s name. 24 Falcon’s diamond “F” mark is at best descriptive and is not 25 inherently distinctive. 26 secondary meaning. 27 28 63. Thus, Falcon must produce evidence of To establish secondary meaning associated with a basic geometric shape, the moving party must provide “convincing 16 1 evidence” that the public associates the alleged mark with the 2 plaintiff. 3 (Cust. & Pat. App. 1961). 4 See In re David Crystal, Inc., 296 F.2d 771, 778 64. Falcon does not produce evidence sufficient to 5 establish secondary meaning. 6 that customers associate its products with the diamond “F” mark 7 or that it is used in any place other than stamped at the end of 8 its connectors. 9 be used only as a stamp on the connector, not in Falcon’s paper 10 wrapper on the connector, nor as a logo for the company, nor in 11 its advertisements. 12 65. Falcon fails to provide evidence Additionally, the diamond “F” mark is shown to There is also some evidence of third-party usage 13 of a diamond shape on other flexible water connector pipes, 14 (Novello Decl. ¶ 12), which eliminates a showing of exclusivity, 15 an element of secondary meaning. 16 949 F.2d 576, 581 (2d Cir. 1991) (extensive third party usage of 17 similar words eliminates trademark protection and vitiates a 18 claim that the public associates the commonly used word with a 19 given party). 20 66. Lang v. Ret. Living Publ’g Co., On the current record, it appears that Falcon does 21 not have a protectable trademark interest in its diamond “F” 22 mark. 23 is a likelihood of confusion arising from Rino’s use of its “S” 24 mark. 25 Consequently, the Court need not determine whether there 67. Falcon fails to satisfy its burden to show a 26 likelihood of prevailing on the merits and is, therefore, 27 precluded from obtaining relief that would bar Rino from using 28 its “S” mark. 17 1 C. Irreparable Injury 68. 2 Falcon demonstrates likelihood of success on the 3 merits on only one of its four claims: 4 its water connectors flow more water than Falcon’s water 5 connectors. 69. 6 Rino’s advertisement that “When an advertisement draws an explicit 7 comparison between the competitor’s product and plaintiff’s, then 8 such a causative link of irreparable injury is presumed because a 9 misleading comparison to a specific competing product necessarily 10 diminishes that product’s value in the minds of the consumer.” 11 Mut. Pharm. Co. v. Ivax Pharm. Inc., 459 F. Supp. 2d 925, 944 12 (C.D. Cal. 2006) (internal quotations omitted). 13 70. Here, Rino’s advertisement directly compares its 14 products with Falcon’s, thus the Court presumes irreparable 15 injury as to this claim. 16 D. 17 The Balance of Hardships 71. The balancing of hardships analysis ensures the 18 issuance of an injunction will not harm the defendants more than 19 a denial will harm the plaintiffs. 20 Metrosound U.S.A., Inc., 4 F.3d 819, 827 (9th Cir. 1993). 21 relative size and strength of each enterprise may be pertinent to 22 this inquiry.” 23 72. Int’l Jensen, Inc. v. “[T]he Id. Falcon is the larger of the two enterprises here, 24 as it has been in business more than 25 years and is acknowledged 25 as a leading producer of top-quality products. 26 4.) 27 likelihood of success on the merits of its claim that Rino’s 28 advertisement that compares the water flow capacity of its water (Wolff Decl. ¶ Based on the current state of the record, it demonstrates a 18 1 connectors and Falcon’s is false and irreparable injury related 2 to that claim. 73. 3 Rino is the newer company and thus an injunction 4 may be more likely to harm it. 5 an identifiable harm that would stem from an injunction 6 prohibiting it from making the current comparative advertisement. 7 (Def. Opp. pp. 20-21.) 74. 8 9 Rino does not, however, point to Thus, the balance of the hardships does not tip so sharply in Rino’s favor as to preclude preliminary injunctive 10 relief related to Rino’s current comparative advertisement. 11 E. The Public Interest 75. 12 It is in the public’s interest to be free from 13 misleading advertising, which is the Lanham Act’s purpose. There 14 is no evidence that granting the preliminary injunction against 15 Rino’s comparative advertising would be against the public 16 interest. 17 F. Evidentiary Issues The Court has considered the timely submissions of the 18 19 parties (submitted prior to the time of the hearing). 20 submissions have been disregarded. 21 Judicial Notice is denied. 22 // 23 // 24 // 25 // 26 // 27 // 28 // 19 Any after- Plaintiff’s Request for 1 V. 2 ORDER 3 Based on the foregoing findings of fact and conclusions 4 of law, the Court denies Plaintiff's Motion for Preliminary 5 Injunction, except to the extent that the Court orders defendants 6 enjoined from using Rino’s current advertisement that its 7 products have a greater water flow than Falcon’s products. 8 The Clerk shall serve these Findings of Fact and 9 Conclusions and Order on counsel for all parties in this action. 10 IT IS SO ORDERED. 11 Dated: December 9, 2008. 12 13 ______________________________ ALICEMARIE H. STOTLER CHIEF U.S. DISTRICT JUDGE 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 O:\ECF Ready\Falcon v Rino FOFACOL.v3.wpd 20

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