Hazelden Betty Ford Found. v. My Way Betty Ford Klinik GmbH

1

Hazelden Betty Ford Foundation, a Minnesota nonprofit corporation, and Elizabeth B. Ford Charitable Trust, Plaintiffs, v. My Way Betty Ford Klinik GmbH, Defendant.

No. 20-cv-409 (JRT/TNL)

United States District Court, D. Minnesota

March 29, 2023

*FILED UNDER SEAL*^[1]

Laura L. Myers, Luke P. de Leon, and Timothy M. O'Shea Fredrikson & Byron, PA, 200 South Sixth Street, Suite 4000, Minneapolis, MN 55402-1425 (for Plaintiffs); and

Chad A. Snyder and Michael H. Frasier, Rubric Legal LLC, 111 Third Avenue South, Suite 110, Minneapolis, MN 55401; and Jiwon Juliana Yhee, Michael S. Golenson, and Riebana Elisabeth Sachs, Masuda, Funai, Eifert & Mitchell, Ltd., 203 North LaSalle Street, Suite 2500, Chicago, IL 60601 (for Defendant).

ORDER

Tony N. Leung United States Magistrate Judge District of Minnesota

I. INTRODUCTION

This matter comes before the Court on Defendant My Way Betty Ford Klinik GmbH's (“Klinik”) Motion to Compel ECF No. 100, and Plaintiffs Hazelden Betty Ford Foundation and Elizabeth B. Ford Charitable Trust's (collectively, “Hazelden Betty Ford”) Motion to Compel Further Answers, Production of Documents, and Deposition Appearances in the United States, ECF No. 106.

A hearing was held. ECF No. 143. Laura L. Myers and Timothy M. O'Shea appeared on behalf of Hazelden Betty Ford. Alan M. Anderson, of the Alan Anderson Law Firm LLC,^[2] appeared on behalf of the Klinik.

II. BACKGROUND

Hazelden Betty Ford “operate[s] drug and alcohol treatment programs across the United States and hold[s] exclusive rights to the use and licensing of the Betty Ford Marks, which are associated with [its] distinct treatment model.” Hazelden Betty Ford Found. v. My Way Betty Ford Klinik, GmbH, No. 20-cv-409 (JRT/TNL), 2021 WL 3711055, at *1 (D. Minn. Aug. 20, 2021) [hereinafter Hazelden II]; see also Hazelden Betty Ford Found. v. My Way Betty Ford Klinik, GmbH, 504 F.Supp.3d 966, 970-91 (D. Minn. 2020) [hereinafter Hazelden I]. The Klinik “is a German entity that operates a drug and alcohol treatment facility in Bad Bruckenau, Germany.” Hazelden II, 2021 WL 3711055, at *1; see also Hazelden I, 504 F.Supp.3d at 971.

In brief, “[f]rom 1992 to 2013, the Betty Ford Center . . ., a former California nonprofit public benefit corporation, held a limited license from the Betty Ford Trust permitting [the Betty Ford Center] to use the Betty Ford name and Marks in connection with its substance abuse treatment services.” Hazelden I, 504 F.Supp.3d at 971. “In 2012, [the Klinik] contacted [the Betty Ford Center] to explore the possibility of a cooperative relationship.” Id.; see also Hazelden II, 2021 WL 3711055, at *1. In 2013, Sigurd Gawinski and Sven Marquardt “traveled to California on behalf of . . . [the] Klinik to discuss their ideas and deliver a letter of intent for the proposed partnership.” Hazelden I, 504 F.Supp.3d at 971-72. The Betty Ford Center subsequently informed the “Klinik that [it] was not interested in pursuing a business arrangement.” Id. at 971.

In the fall of 2013, “[the Betty Ford Center] merged with Hazelden, a Minnesota nonprofit corporation with a principal place of business in Center City, Minnesota,” which “operates alcohol and drug treatment programs in Minnesota, California, Oregon, Illinois, Florida, Washington, and New York.” Id. at 971, 972. “While the Betty Ford Trust continues to own the ‘Betty Ford Center' trademark for uses related to education, treatment, and other drug and alcohol treatment services, Hazelden has the exclusive right to use the Betty Ford Name and Marks.” Id. at 971.

In April 2014, “Marquardt and Gawinski traveled to Minnesota and met with” Hazelden. Id. at 972; see also Hazelden II, 2021 WL 3711055, at *1. “Hazelden informed . . . [the] Klinik in writing at that meeting that it would not provide a license to use the Betty Ford name and that it relied on . . . [the] Klinik's prior assurances that it would change its name and cease using references to ‘Betty Ford' by July 1, 2015.” Hazelden II, 2021 WL 3711055, at *1; see also Hazelden I, 504 F.Supp.3d at 972. The Klinik has “continued to use the ‘Betty Ford' name.” Hazelden I, 504 F.Supp.3d at 972; see also Hazelden II, 2021 WL 3711055, at *2.

By Amended Complaint, Hazelden Betty Ford brings claims against the Klinik for trademark infringement under 15 U.S.C. § 1114; unfair competition under 15 U.S.C. § 1125(a); false advertising under 15 U.S.C. § 1125(b); common-law trademark infringement; cybersquatting in violation of 15 U.S.C. § 1125(d); and right of publicity infringement under Cal. Civ. Code § 3344.1. See generally ECF No. 6.

III. ANALYSIS

A. Legal Standard

The parties' motions implicate the Court's broad discretion in handling pretrial procedure and discovery. See, e.g., Rowles v. Curators of Univ. of Mo., 983 F.3d 345, 353 (8th Cir. 2020) (“A district court has very wide discretion in handling pretrial discovery ....” (quotation omitted)); Solutran, Inc. v. U.S. Bancorp, No. 13-cv-2637 (SRN/BRT), 2016 WL 7377099, at *2 (D. Minn. Dec. 20, 2016) (“Further, magistrate judges ‘are afforded wide discretion in handling discovery matters and are free to use and control pretrial procedure in furtherance of the orderly administration of justice.'” (internal quotation marks omitted) (quoting Favors v. Hoover, No. 13-cv-428 (JRT/LIB), 2013 WL 6511851, at *3 n.3 (D. Minn. Dec. 12, 2013)).

In general, “[p]arties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case ....” Fed.R.Civ.P. 26(b)(1). “Some threshold showing of relevance must be made[, however,] before parties are required to open wide the doors of discovery and to produce a variety of information which does not reasonably bear upon the issues in the case.” Hofer v. Mack Trucks, Inc., 981 F.2d 377, 380 (8th Cir. 1992). Further, “[t]he parties and the court have a collective responsibility to consider the proportionality of all discovery and consider it in resolving discovery disputes.” Vallejo v. Amgen, Inc., 903 F.3d 733, 742 (8th Cir. 2018) (quoting Fed.R.Civ.P. 26 advisory committee's note to 2015 amendment); see Lynch v. Experian Info. Sols., Inc., 569 F.Supp.3d 959, 963 (D. Minn. 2021) (“Beyond being relevant, Rule 26 requires that information sought in discovery also be ‘proportional to the needs of the case.'” (quoting Fed.R.Civ.P. 26(b)(1))), aff'd, 581 F.Supp.3d 1122 (D. Minn. 2022). “[A] court can-and must- limit proposed discovery that it determines is not proportional to the needs of the case.” Vallejo, 903 F.3d at 742 (quotation omitted); see Fed.R.Civ.P. 26(b)(2)(C)(iii). Considerations bearing on proportionality include “the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.” Fed.R.Civ.P. 26(b)(1); see also Vallejo, 903 F.3d at 742-43.

“Trademarks are protected against infringement, that is, the use of similar marks on similar or related products or services if such use creates a likelihood of confusion.” Select Comfort Corp. v. Baxter, 996 F.3d 925, 932 (8th Cir.), cert. denied sub nom. Dires, LLC v. Select Comfort Corp., 142 S.Ct. 561 (2021). “The ‘core inquiry' when assessing the likelihood of confusion is ‘whether the relevant average consumers for a product or service are likely to be confused as to the source of a product or service or as to an affiliation between sources based on a defendant's use.'” H&R Block, Inc. v. Block, Inc., 58 F.4th 939, 947 (8th Cir. 2023) (quoting Select Comfort Corp., 996 F.3d at 933). The Eighth Circuit Court of Appeals

has set forth a list of nonexclusive, nonexhaustive factors to assess likelihood of confusion, which includes: (1) the strength of the owner's mark; (2) the similarity of the owner's mark and the alleged infringer's mark; (3) the degree to which the products compete with each other; (4) the alleged infringer's intent to “pass off” its goods as those of the trademark owner; (5) incidents of actual confusion; and (6) the type of product, its cost and conditions of purchase.

Id. (quotation omitted); accord Select Comfort Corp., 996 F.3d at 933; see also SquirtCo. v. Seven-Up Co., 628 F.2d 1086, 1091 (8th Cir. 1980). “[N]o one factor is controlling and different factors will carry more weight in different settings.” Select Comfort Corp., 996 F.3d at 933; accord H&R Block, 58 F.4th at 947. Moreover, “depending on the context, a strong showing as to one factor may serve to make a different factor more or less important.” Select Comfort Corp., 996 F.3d at 934. As the Eighth Circuit has explained,

[t]his flexible, context-specific, and relative-rather-than-mechanical approach makes sense because the general function of the likelihood-of-confusion factors is to guide the finder of fact towards considerations generally thought to be material to the consuming public's understanding of product source or affiliation. Common sense is inherent in the factors, and the factors, properly applied, should try to capture a holistic view of the normal experiences for any given industry, product, or service. The consumer experience differs by products (buying a toothbrush vs. buying a car vs. professional buyers obtaining input goods for a factory), and the relative importance of any given factor is influenced greatly by how the other factors might apply.

Id.

B. The Klinik's Motion

The Klinik moves to compel responses to Request for Production Nos. 6, 7, and 14. The Court considers each in turn.

1. Request for Production No. 6

Request for Production No. 6 seeks “[d]...