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Sream Inc. v. Bengal Star, Inc.

United States District Court, S.D. Florida

November 2, 2017

SREAM, INC., a California Corporation, Plaintiff,
v.
BENGAL STAR, INC., Defendant.

          ORDER DENYING DEFENDANT'S MOTION TO DISMISS AMENDED COMPLAINT [DE 181

          WILLIAM MATTHEWMAN UNITED STATES MAGISTRATE JUDGE

         THIS CAUSE is before the Court upon Defendant, Bengal Star, Inc.'s ("Defendant") Motion to Dismiss Amended Complaint ("Motion") [DE 18]. This matter was referred to the undersigned by United States District Judge Kenneth A. Marra for appropriate disposition after the parties consented to magistrate jurisdiction for the motion to dismiss and all related motions, including the entry of final judgment with respect to the motion to dismiss, if applicable. See DEs 32, 33. Plaintiff, Sream, Inc. ("Plaintiff), filed a Response [DE 21');">21], Defendant filed a Reply [DE 26');">26], and Plaintiff filed a Notice of Filing Supplemental Authority in Opposition to Defendant's Motion to Dismiss Amended Complaint [DE 29]. The matter is now ripe for review.

         I. BACKGROUND

         Plaintiffs initially filed a Complaint on October 21');">21, 2016, alleging trademark infringement, trademark counterfeiting, false designation of origin/unfair competition, and violation of Florida Deceptive and Unfair Trade Practices Act. [Compl. DE 1]. On April 6, 2017, Defendant filed a Motion and Memorandum of Law to Dismiss Complaint for Lack of Standing and Failure to State a Claim [DE 16]. Before the Court ever ruled on the motion to dismiss, on April 26');">26, 2017, Plaintiff filed an Amended Complaint [DE 17].

         The Amended Complaint alleges trademark infringement, in violation of 15 U.S.C. § 1114 (Count 1), trademark counterfeiting, in violation of 15 U.S.C. § 1116 (Count 2), false designation of origin/unfair competition, in violation of 15 U.S.C. § 1125 (Count 3), and violation of Florida Deceptive and Unfair Trade Practices Act (Count 4). [Amended Compl., DE 17]. According to Plaintiff, Mr. Martin Birzle d/b/a RooR ("RooR") is an award-winning designer and manufacturer of smoker's products, and Plaintiff has been the exclusive licensee of the RooR Mark in the United States since at least August 2013. Id. at ¶¶ 9, 12. Plaintiff has a licensing agreement with RooR pursuant to which Plaintiff has manufactured water pipes under the RooR Marks and has advertised, marketed, and distributed water pipes, water pipe parts, and other smoker's articles in association with the RooR Marks. Id. at ¶ 12. RooR is the exclusive owner of the federally registered and common law trademarks. Id. at ¶ 14.

         The Amended Complaint alleges that, because authentic RooR-branded products sell for higher prices, RooR products are frequent targets of counterfeiters. [Amended Compl., DE 17 at ¶ 16]. The Amended Complaint further alleges that Defendant is in the business of selling goods, including water pipes, and that Defendant has sold goods affixed with the RooR trademark. Id. at ¶ 20. According to Plaintiff, Defendant has, without Plaintiffs consent, sold goods with the "RooR" Marks using reproductions, counterfeits, copies and/or colorable imitations. Id. at ¶ 21');">21. Specifically, Defendant sold a water pipe to Plaintiffs investigator that had a RooR brand trademark affixed to it which was a counterfeit good. Id. at ¶¶ 22-23.

         On May 10, 2017, Defendant filed its Motion to Dismiss [DE 18], which is currently pending before the Court. The Court notes that Defendant is not currently represented by counsel as its counsel withdrew in October 2017. See DEs 35, 38, 39.

         II. MOTION, RESPONSE, REPLY, AND SUR-REPLY

         a. Motion

         In the Motion, Defendant first argues that Plaintiff has failed to establish standing because Plaintiff failed to properly state an interest in the trademarks at issue, and no license is attached to the Amended Complaint. [DE 18, p. 3]. Defendant asserts that the three marks listed in the Amended Complaint "are not registered to RooR, but, rather to [Martin] Birzle" and that Defendant needs to know if the "license was from Birzle or RooR." Id. at p. 4. Defendant further contends that Plaintiffs "strained alternating use of Birzle and RooR in the complaint makes it impossible to determine if standing is proper." Id. Defendant also points out contradictions between the Complaint and Amended Complaint and between the Amended Complaint and certain public records. Id. at p. 5');">p. 5.

         Defendant's second argument in the Motion is that Plaintiffs trademark claims in Florida are barred by the "Unlawful Use Doctrine" because the allegations in the Amended Complaint are based on facts that predate Plaintiffs recent registration of the RooR fictitious name in Florida. [DE 18, pp. 5');">p. 5-6]. Defendant argues that amendment of the complaint would be futile "because Plaintiff cannot show lawful use in Florida commerce at any time prior to or even after filing the Amended Complaint (or even the original Complaint)." Id. at p. 8.

         b. Response

         In its Response [DE 21');">21], Plaintiff asserts that it has attached to the Response Plaintiffs exclusive licensing agreement for the RooR trademarks at issue and that the agreement gives Plaintiff the standing to maintain this action. Id. at p. 4. The licensing agreement is between Martin Birzle and Plaintiff. Id.

         Plaintiff maintains that the allegations in the Amended Complaint meet the pleading requirements of Federal Rule of Civil Procedure 8(a)(2), so Plaintiff was not required to attach its licensing agreement or the registrations for the RooR Marks to the Amended Complaint. [DE 21');">21, p. 5');">p. 5]. Plaintiff specifically argues that the allegations in the Amended Complaint "sufficiently state that the Plaintiff has been the exclusive licensee for the RooR trademarks since 2013, " and the allegations "articulate the Plaintiffs interest in the trademarks as an ...


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