Free Kick Master LLC v. Apple Inc.

140 F.Supp.3d 975

Free Kick Master LLC, Plaintiff,

v.Apple Inc., et al., Defendants.

Case No. 15-cv-03403-PJH

United States District Court, N.D. California.

Signed October 19, 2015

Eugene Steven Alkana, Attorney at Law, Pasadena, CA, Stanley L. Josselson, Cleveland, OH, for Plaintiff.

David R. Eberhart, O'Melveny & Myers LLP, Joseph C. Gratz, Michael Henry Page, Durie Tangri LLP, San Francisco, CA, H. Alan Rothenbuecher, Schottenstein Zox & Dunn, Jonathon W. Groza, Ice Miller, William A. Doyle, Taft Stettinius & Hollister, David H. Wallace, Cleveland, OH, Jordan Philip Raphael, O'Melveny and Myers LLP, John Charles Ulin, Jacob Kevin Poorman, Arnold & Porter LLP, Los Angeles, CA, for Defendants.

ORDER GRANTING MOTIONS TO DISMISS

PHYLLIS J. HAMILTON, United States District Judge

Defendants' motions to dismiss the second amended complaint ("SAC") for failure to state a claim came on for hearing before this court on September 30, 2015. Plaintiff Free Kick Master LLC ("Free Kick Master") appeared by its counsel Val Schurowliew, Stanley Josselson, and Eugene Alkana; defendants Amazon.com, Inc. ("Amazon") and Google, Inc. ("Google") appeared by their counsel Michael Page; and defendant Samsung Electronics USA ("Samsung USA") appeared by its counsel John Ulin. (Defendant Apple, Inc. did not move for dismissal.) Having read the parties' papers and carefully considered their arguments and the relevant legal authority, the court hereby GRANTS the motions as follows.

BACKGROUND

Plaintiff Free Kick Master is a Nevada limited liability company, and the owner of the registered "Free Kick Master" mark. SAC ¶¶ 10-14. Plaintiff alleges that the Apple AppStore offers a "Free Kick Master" application ("app") or game for downloading to Apple devices; that the Amazon AppStore offers a "Free Kick Master" app or game for downloading to Kindle Fire devices; that Google Play offers a "Free Kick Master" app or game for downloading to Android devices; and that Samsung advertises downloads of a "Free Kick Master" app or game to Android devices and offers the downloads for free. SAC ¶¶ 17-22.

Plaintiff asserts that the defendants' use, sale, distribution, and/or promotion of these "Free Kick Master" apps/games is without authorization or consent from plaintiff and constitutes infringement of plaintiff's trademark; and that it also causes a likelihood of confusion, mistake, or deception in the minds of the public because its "Free Kick Master" mark is identical to the names of the apps or games marketed and/or distributed by the four defendants. SAC ¶¶ 23-25.

Plaintiff contends that it held a "Free Kick Master event" in July 2008 in Houston TX, at which various famous soccer players appeared, and which was televised internationally. SAC ¶ 26. Plaintiff asserts that it held additional events in 2010 in Las Vegas NV, and in 2012 in Buenos Aires, Argentina. SAC ¶¶ 28-29. Plaintiff alleges that the format and rules of the apps/games that are available on defendants' sites are similar to the format and rules utilized in plaintiff's "Free Kick Master" game and events, and that it has developed products based on the "Free Kick Master" events, including electronic and board games and watches. See SAC ¶¶ 27-33.

Plaintiff filed the original complaint in this action on April 14, 2015, in the Northern District of Ohio, alleging trademark infringement under federal law, and deceptive trade practices and unfair competition under Ohio law. Plaintiff filed a first amended complaint on May 12, 2015. Defendants filed motions to transfer venue, or in the alternative, to dismiss for failure to state a claim. On July 21, 2015, the Ohio court issued an order granting the motion to transfer venue to this district. The court did not rule on the alternative motions to dismiss.

After the case was transferred, the parties stipulated to the filing of the SAC. In the SAC, plaintiff alleges six causes of action: (1) trademark infringement under the Lanham Act, 15 U.S.C. § 1114 ; (2) false designation of origin under the Lanham Act, 15 U.S.C. § 1125(a) ); (3) injunctive relief; (4) trademark infringement under California law; (5) unfair, unlawful, and fraudulent business practices under Cal. Bus. & Prof. Code § 17200 ; and (6) false advertising under Cal. Bus. & Prof Code § 17500. It appears that the six causes of action are asserted against all four defendants.

DISCUSSION

A. Legal Standard

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests for the legal sufficiency of the claims alleged in the complaint. Ileto v. Glock, Inc. , 349 F.3d 1191, 1199–1200 (9th Cir.2003). Review is generally limited to the contents of the complaint, although the court can also consider a document on which the complaint relies if the document is central to the claims asserted in the complaint, and no party questions the authenticity of the document. See Sanders v. Brown , 504 F.3d 903, 910 (9th Cir.2007).

To survive a motion to dismiss for failure to state a claim, a complaint generally must satisfy only the minimal notice pleading requirements of Federal Rule of Civil Procedure 8, which requires that a complaint include a "short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2)

A complaint may be dismissed under Rule 12(b)(6) for failure to state a claim if the plaintiff fails to state a cognizable legal theory, or has not alleged sufficient facts to support a cognizable legal theory. Somers v. Apple, Inc. , 729 F.3d 953, 959 (9th Cir.2013). While the court is to accept as true all the factual allegations in the complaint, legally conclusory statements, not supported by actual factual allegations, need not be accepted. Ashcroft v. Iqbal , 556 U.S. 662, 678–79, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ; see also In re Gilead Scis. Sec. Litig. , 536 F.3d 1049, 1055 (9th Cir.2008).

The allegations in the complaint "must be enough to raise a right to relief above the speculative level[,]" and a motion to dismiss should be granted if the complaint does not proffer enough facts to state a claim for relief that is plausible on its face. Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 555, 558–59, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (citations and quotations omitted). A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 (citation omitted). "[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged—but it has not ‘show[n]’—‘that the pleader is entitled to relief.’ " Id. at 679, 129 S.Ct. 1937. Where dismissal is warranted, it is generally without prejudice, unless it is clear the complaint cannot be saved by any amendment. Sparling v. Daou , 411 F.3d 1006, 1013 (9th Cir.2005).

B. Defendants' Motions

1. Amazon/Google's motion

In their joint motion, Amazon and Google argue that the claims asserted against them in the SAC should be dismissed for failure to state a claim. Amazon/Google argue that the first and second (federal trademark) causes of action must be dismissed because plaintiff is instead seeking to hold Amazon/Google liable for alleged infringements by third-party app developers, but does not allege that either Amazon or Google knew of the alleged infringement.

Plaintiff asserts trademark infringement claims under 15 U.S.C. § 1114 and § 1125(a). Under 15 U.S.C. § 1114, a defendant is liable in a civil action if he/she/it, without the consent of the registrant, uses in commerce an imitation of a registered mark in connection with goods or services which is likely to cause confusion, mistake, or to deceive. See 15 U.S.C. § 1114.

Under 15 U.S.C. § 1125(a), a defendant is liable in a civil action if he/she/it uses in commerce, in connection with goods or services, any word, term, name, symbol, or device, or any false designation of origin or false or misleading description or representation of fact, which is likely to cause confusion or mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities.

Thus, to establish a claim of direct trademark infringement, a plaintiff must show (1) it has valid, protectable trademarks, and (2) that defendant's use of the marks in commerce is likely to cause confusion. See, e.g. , Applied Info. Sciences Corp. v. eBay, Inc. , 511 F.3d 966, 969 (9th Cir.2007). There is no allegation in the SAC that the defendants themselves used the "Free Kick Master" mark in commerce. Rather, the trademark infringement claims can only be interpreted as claims of contributory infringement.

A manufacturer or distributor can be held liable for the infringing acts of another if it "intentionally induces another to infringe a trademark, or if it continues to supply its product to one whom it knows or has reason to know is engaging in trademark infringement." Inwood Labs . , Inc. v. Ives Labs, Inc. , 456 U.S. 844, 853, 102 S.Ct. 2182, 72 L.Ed.2d 606 (1982). The Ninth Circuit has expanded this rule to impose liability on those who continue to supply a service (as opposed to a product) to one known to be using it in an infringing manner, so long as the service provider is also shown to have "[d]irect control and monitoring of the instrumentality used by a third party to infringe...." Lockheed Martin Corp. v. Network Solutions, Inc. , 194 F.3d 980, 984 (9th Cir.1999).

Amazon/Google argue that the first and second causes of action fail to state a claim for contributory infringement because plaintiff alleges no facts showing that th...