Iditasport Alaska v. Merchant

          ORDER

          H. RUSSEL HOLLAND UNITED STATES DISTRICT JUDGE

         Motion to Dismiss

         Counterclaim defendants move to dismiss the counterclaims asserted against them.^[1] This motion is opposed.^[2] Oral argument was not requested and is not deemed necessary.

         Background

         Plaintiff is Iditasport Alaska. Defendants are Katharina Merchant, Kyle Durand, Kevin Robbins, Alaska Ultra Sport LLC, and Winter Ultra LLC.

         Plaintiff is owned and operated by Billy and Erica Koitzsch.^[3] Plaintiff alleges that it operates the Iditasport ultramarathon.^[4] Plaintiff alleges that the Iditasport ultramarathon was first held in 1987, but that “[o]rganizational difficulties caused the event to lapse in 2001[.]”^[5]Plaintiff alleges that the Koitzschs “revived” the event in 2014 and “branded the event under its original name: Iditasport.”^[6]

         Plaintiff alleges that the Koitzschs “acquired a federal trademark for” the “IDITASPORT design mark” in 2014, U.S. Registration No. 4574317.^[7] This “mark consists of (blue) mountain range with a sun, the (red text) ‘IDITA' on the next line (red text) ‘SPORT' on the next line, wide blue line underneath and in smaller (blue text), ‘Human Powered Ultra-Marathon[.]'”^[8] Plaintiff further alleges that in 2018, it “filed a trademark application for the [word] mark IDITASPORT, U.S. Trademark Application Ser. No. 877860698. . . .”^[9] Iditasport Alaska alleges that the IDITASPORT word mark and the IDITASPORT design mark “have gained fame and distinction within the State of Alaska, within the United States, and worldwide by virtue of their longstanding use in identifying a premier winter endurance event.”^[10]

         Plaintiff alleges that defendants operate “the Iditarod Trail Invitational, an ultramarathon intended to replace the Iditasport event.”^[11] Plaintiff alleges that defendants have since 2015, “attempted to associate their event with Iditasport, without Iditasport's license or permission.”^[12] Plaintiff alleges that defendant Ultra Sport filed a trademark application in 2016 for the word mark, IDITASPORT, U.S. Trademark Application Ser. No. 86961602, but that this application “was rejected due to a likelihood of confusion with the IDITASPORT design mark.”^[13] Plaintiff also alleges that defendants have acquired three domain names that include the word “iditasport”.^[14]

         Plaintiff asserts federal and state trademark and unfair competition claims against defendants based on allegations that they are infringing plaintiff's IDITASPORT design mark and its IDITASPORT word mark. Plaintiff also asserts a cyberpiracy claim based on allegations that defendants have inappropriately acquired the domain names which include the term “iditasport.”

         In response, Alaska Ultra Sport LLC and Winter Ultra LLC (referred to hereafter as the Ultra plaintiffs) assert counterclaims against Iditasport Alaska and Billy and Erica Koitzsch (referred to hereafter as the Iditasport defendants). The Ultra plaintiffs allege that Alaska Ultra Sport has been operating the Iditarod Trail Invitational since 2002.^[15] The Ultra plaintiffs allege that Alaska Ultra Sport assumed operation of the original Iditasport event in that year.^[16] The Ultra plaintiffs allege that “Alaska Ultra Sport [has] continually used the mark Iditasport in connection with athletic and sports event services from 2007 through 2018[, ]” thereby making it “the first of the parties to this case to use the mark Iditasport in connection with athletic and sports event services.”^[17] The Ultra plaintiffs allege that they “own valid and subsisting common law rights to the Iditasport mark” based on their “widespread, continuous, and exclusive use of the Iditasport mark to identify their event. . . .”^[18]

         The Ultra plaintiffs allege that in 2014, the Koitzschs “launched a small winter athletic event designed to compete with the Iditarod Trail Invitational and chose the name Iditasport without license or permission from Alaska Ultra Sport.”^[19] The Ultra plaintiffs allege that the Iditasport defendants falsely claimed to have been using the Iditasport mark since January 1, 1990, when Alaska Iditasport applied for the IDITASPORT design mark in 2014.^[20] The Ultra plaintiffs allege that since 2014, the Iditasport defendants “have systematically attempted to divert customers from the Iditarod Trail Invitational” by “promulgat[ing] . . . false and misleading statements and inflammatory remarks regarding the Iditarod Trail Invitational and its organizers and by actively soliciting current and prospective Iditarod Trail Invitational customers to withdraw from the Iditarod Trail Invitational.”^[21]

         The Ultra plaintiffs also allege that Alaska Ultra Sport owns the copyright to a Release and Waiver of Liability document that was created in 2011.^[22] They allege that on May 29, 2018, Alaska Ultra Sport submitted an application to register its copyright in this work.^[23]The Ultra plaintiffs allege that the Iditasport defendants copied the Release and Waiver of Liability document and have used the work “as part of their solicitations of customers for their athletic events by distributing” the work “electronically on their website.”^[24]

         The Ultra plaintiffs assert five counterclaims. In their first counterclaim, the Ultra plaintiffs assert a common law trademark infringement claim. In their second counterclaim, the Ultra plaintiffs seek to cancel the registration for the Iditasport design mark (the ‘317 mark). In their third counterclaim, the Ultra plaintiffs assert a claim for copyright infringement. In their fourth counterclaim, the Ultra plaintiffs assert an intentional interference with a prospective economic advantage claim. In their fifth counterclaim, the Ultra plaintiffs assert a civil conspiracy claim.

         Pursuant to Rules 8, 9(b), and 12(b)(6), Federal Rules of Civil Procedure, the Iditasport defendants now move to dismiss all five counterclaims asserted against them.

         Discussion

         “Rule 8 requires a complaint to include ‘a short and plain statement of the claim showing that the pleader is entitled to relief.'” Eclectic Properties East, LLC v. Marcus & Millichap Co., 751 F.3d 990, 995 (9th Cir. 2014) (quoting Fed.R.Civ.P. 8(a)(2)). “To meet this requirement, the Supreme Court has held that an ‘entitlement to relief' requires ‘more than labels and conclusions. . . . Factual allegations must be enough to raise a right to relief above a speculative level.'” Id. (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)).

         “Under Rule 9(b), a plaintiff ‘must state with particularity the circumstances constituting fraud.'” United States v. United Healthcare Ins. Co., 848 F.3d 1161, 1180 (9th Cir. 2016) (quoting Fed.R.Civ.P. 9(b)). “This means the plaintiff must allege the who, what, when, where, and how of the misconduct charged, including what is false or misleading about a statement, and why it is false[.]” Id. (internal citations omitted). “Knowledge, however, may be pled generally.” Id.

         “‘To survive a [Rule 12(b)(6)] motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Zixiang Li v. Kerry, 710 F.3d 995, 999 (9th Cir. 2013) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). “A claim is facially plausible ‘when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'” Id. (quoting Iqbal, 556 U.S. at 678). “‘Where a complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the line between possibility and plausibility of entitlement to relief.'” Id. (quoting Iqbal, 556 U.S. at 678). “[T]he complaint must provide ‘more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.'” In re Rigel Pharmaceuticals, Inc. Securities Litig., 697 F.3d 869, 875 (9th Cir. 2012) (quoting Twombly, 550 U.S. at 555). “In evaluating a Rule 12(b)(6) motion, the court accepts the complaint's well-pleaded factual allegations as true and draws all reasonable inferences in the light most favorable to the plaintiff.” Adams v. U.S. Forest Srvc., 671 F.3d 1138, 1142-43 (9th Cir. 2012).

         “When ruling on a Rule 12(b)(6) motion, if ‘matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56.” Hicks v. PGA Tour, Inc., 897 F.3d 1109, 1117 (9th Cir. 2018) (quoting Fed.R.Civ.P. 12(d)). The Iditasport defendants have submitted matters outside the pleadings; but the court has not considered these matters and thus the instant motion does not need to be converted to a motion for summary judgment.

         first counterclaim - common law trademark infringement

         To prevail on their common law trademark infringement claim, the Ultra plaintiffs must prove: “(1) ownership interest in a mark, and (2) the likelihood of the infringing mark being confused with the [Iditasport defendants'] mark.” Sebastian Brown Productions, LLC v. Muzooka, Inc., 143 F.Supp.3d 1026, 1039 (N.D. Cal. 2015). The Iditasport defendants argue that the Ultra plaintiffs have failed to state a plausible common law trademark infringement claim because they have not adequately alleged an ownership interest in a mark nor have they adequately alleged priority in their mark.

         The Ultra plaintiffs argue that they have adequately alleged ownership interest in the Iditasport word mark, and they cite to paragraph 17 of the counterclaim and Exhibit B to the counterclaim in support. In paragraph 17, the Ultra plaintiffs allege that “Alaska Ultra Sport continually used the mark Iditasport in connection with athletic and sport event services. . . .”^[25] This reference to the “Iditasport” mark is not sufficient. The Ultra plaintiffs do not state whether this mark consists of words only or whether this mark includes design elements similar to the ‘317 mark. The Ultra plaintiffs' reliance on Exhibit B to their counterclaim is also unavailing. Exhibit B is a screenshot of the Iditarod Trail Invitational website with an article on the History of Winter Biking and Winter Races in Alaska that refers to an “Iditasport race” in the past tense.^[26] Exhibit B does not indicate what mark the Ultra plaintiffs are claiming an interest in.

         As for the Ultra plaintiffs' allegations of priority of use, “[i]t is axiomatic in trademark law that the standard test of ownership is priority of use.” Sengoku Works Ltd. v. RMC Int'l, Ltd., 96 F.3d 1217, 1219 (9th Cir. 1996). “To acquire ownership of a trademark it is not enough to have invented the mark first or even to have registered it first; the party claiming ownership must have been the first to actually use the mark in the sale of goods or services.” Id. The Ultra plaintiffs allege that Alaska Ultra Sport was the first of the parties to the case to use the Iditasport mark and that it has used the mark from 2007 until 2018.^[27] The Ultra plaintiffs allege that Alaska Ultra Sport used the Iditasport mark “in connection with athletic events and sports event services.”^[28] However, the only specific use of the mark that is alleged is use on the Iditarod Trail Invitational website, ^[29] which, as discussed above, does not indicate what mark the Ultra plaintiffs are claiming an ownership interest in.

         The Ultra plaintiffs have failed to state a plausible claim for common law trademark infringement because they have failed to adequately allege what mark they are claiming an interest in. The Ultra plaintiffs' first counterclaim is dismissed. However, the Ultra plaintiffs are given leave to amend as to this counterclaim.

         second counterclaim - cancellation of the ‘317 mark

         “A party who believes he has been harmed by a trademark's registration may seek the cancellation of that trademark's registration on certain specified grounds, including that the trademark was obtained by the commission of fraud on the United States Patent and Trade Office (USPTO).” Hokto Kinoko Co. v. Concord Farms, Inc., 738 F.3d 1085, 1097 (9th Cir. 2013) (citing 15 U.S.C. § 1064)). The Iditasport defendants first argue that the Ultra plaintiffs lack standing to bring a cancellation claim. The Iditasport defendants appear to argue that the Ultra plaintiffs lack both Article III standing and prudential standing. But, because the standing issue can be resolved on prudential standing grounds, the court need not consider whether the Ultra plaintiffs lack Article III standing. Hong Kong Supermarket v. Kizer, 830 F.2d 1078, 1081 (9th Cir. 1987).

         “[T]he cancellation petitioner [must] plead and prove facts showing a ‘real interest' in the proceeding in order to establish standing.” Star-Kist Foods, Inc. v. P.J. Rhodes & Co., 735 F.2d 346, 349 (9th Cir. 1984) (quoting Int'l Order of Job's Daughters v. Lindeburg & Co., 727 F.2d 1087, 1091 (Fed. Cir. 1984)). “The petitioner . . . must show a real and rational basis for his belief that he would be damaged by the registration sought to be cancelled, stemming from an actual commercial or pecuniary interest in his own mark.” Id.

         The Ultra plaintiffs argue that they have standing to bring a cancellation claim because, as argued above, they contend that they have adequately alleged an ownership interest in the “Iditasport” mark. But, as discussed above, the Ultra plaintiffs have not adequately alleged what mark they are claiming an ownership interest in. Because it is not clear what competing mark the Ultra plaintiffs are claiming an ownership interest in, it is not at all clear that they have an actual commercial or pecuniary interest in their own mark that might be damaged by the ‘317 mark. Thus, the Ultra plaintiffs have failed to state a plausible cancellation claim.^[30] The second counterclaim is dismissed, but the Ultra plaintiffs are given leave to amend this counterclaim.

         third counterclaim - copyright infringement

         “To prove copyright infringement, a plaintiff must show: ‘(1) ownership of a valid copyright and (2) copying of constituent elements of the work that are original.'” Folkens v. Wyland Worldwide, LLC, 882 F.3d 768, 774 (9th Cir. 2018) (quoting Feist Publ'ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 361 (1991)). The Iditasport defendants argue that the Ultra plaintiffs have not plausibly alleged that they copied the protectable elements of the Waiver and Release form. This argument is based on “the doctrines of merger and scènes à faire.” Ets-Hokin v. Skyy Spirits, Inc., 225 F.3d 1068, 1082 (9th Cir. 2000). “Under the merger doctrine, courts will not protect a copyrighted work from infringement if the idea underlying the copyrighted work can be expressed in only one way, lest there be a monopoly on the underlying idea.” Id. “Under the related doctrine of scènes à faire, courts will not protect a copyrighted work from infringement if the expression embodied in the work necessarily flows from a commonplace idea; like merger, the rationale is that there should be no monopoly on the underlying unprotectable idea.” Id. “[W]hen similar features [of a work] are as a practical matter indispensable, or at least standard, in the treatment of a given idea, they are treated like ideas and are therefore not protected by copyright.” Apple Computer Corp. v. Microsoft Corp., 35 F.3d 1435, 1444 (9th Cir. 1994) (citations omitted). The Iditasport defendants argue that any expression in a release and waiver form flows from commonplace principles of contract and liability law and they request that the court take judicial notice of a list of elements of waiver and release forms that they contend are generic.^[31] FRE 201 provides that “[t]he court may judicially notice a fact that is not subject to reasonable dispute because it[] (1) is generally known within the trial court's territorial jurisdiction; or (2) can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” Courts have taken judicial notice of generic elements of creative works. See, e.g., Zella v. E.W. Scripps Co., 529 F.Supp.2d 1124, 1129 (C.D. Cal. 2007) (taking judicial notice of “elements of a television show” because they are “generally known and can be verified simply by watching television for any length of time”).

         The Iditasport defendants then argue that the Waiver and Release form contains no original elements that distinguish it from a generic release form. They argue that any similarity between the Ultra plaintiffs' Waiver and Release form and the forms of other winter event organizers is inevitable and thus there are no original elements to be protected. But even if there were a “thin” level of protection, the Iditasport defendants argue that the Ultra plaintiffs' copyright infringement claim is still not plausible because their release form is not virtually identical to the Ultra plaintiffs' form. See Ets-Hokin, 323 F.3d at 766 (“When we apply ...