Nutradose Labs, LLC v. Bio Dose Pharma, LLC

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NUTRADOSE LABS, LLC, Plaintiff, v. BIO DOSE PHARMA, LLC, et al., Defendants.

No. 22-cv-20780-BLOOM/Otazo-Reyes

United States District Court, S.D. Florida

May 25, 2023

OMNIBUS ORDER ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT AND PLAINTIFF'S PARTIAL MOTION FOR SUMMARY JUDGMENT

BETH BLOOM UNITED STATES DISTRICT JUDGE

THIS CAUSE is before the Court upon Plaintiff Nutradose Labs, LLC's (“Nutradose” or “Plaintiff”) Motion for Partial Summary Judgment ECF No. [60] (“Plaintiff's Motion”), and Defendants Bio Dose Pharma, LLC (“Bio Dose”) and Raimundo Santamarta's (“Santamarta”) Motion for Summary Judgment, ECF No. [66-1] (“Defendants' Motion”).^[1] Plaintiff filed a Response to Defendants' Motion, ECF No. [74-1], along with a Response to Defendants' Statement of Material Facts and Statement of Additional Facts, ECF No. [74-2] (“Pl.'s CSMF”); and Defendants filed a Response to Plaintiffs' Motion, ECF No. [73], along with a Counterstatement of Material Facts, ECF No. [75] (“Defs.' CSMF”).^[2] Plaintiff filed a Reply, ECF No. [84] along with a Reply Statement of Material Facts, ECF No [86-1]; Defendants filed their Reply, ECF No. [89-1], along with a Reply Statement of Material Facts, ECF No. [89-2] (“Defs.' RSMF”).^[3] The Court has reviewed the parties' Motions, their Responses, their Replies, all the statements of material fact, the record in this case, and the applicable law, and is otherwise fully advised. For the reasons below, the Court denies the Defendants' Motion and grants in part and denies in part Plaintiff's Motion.

I.BACKGROUND AND MATERIAL FACTS

This action arises due to alleged infringement by Defendants of Nutradose's trademark. See generally ECF No. [1] (“Nutradose”). In the Complaint, Nutradose alleges that an entity named Unipharma, LLC was a pharmaceutical development and manufacturing company that manufactured a line of dietary supplements under the GLUTADOSE mark. Id. ¶ 10-11. Unipharma registered the GLUTADOSE mark on December 24, 2019. Id. ¶ 12. Less than one year later, Unipharma filed for Chapter 11 bankruptcy, in which Defendants were listed as creditors. Id. ¶ 13. According to Nutradose, the bankruptcy court approved the sale of certain assets of Unipharma, to which Defendants did not object. Id. ¶ 15. Through the bankruptcy sale, NHTV (AIV) ULM BIDCO (“New Vision”) acquired the intellectual property of Unipharma, including the GLUTADOSE mark, and internet and social media accounts and profiles connected to the products and mark. Id. ¶ 16. Nutradose alleges that through the bankruptcy sale Defendants lost any rights they may have had to use the GLUTADOSE mark or sell products bearing the GLUTADOSE mark (“GlutaDose Products”). Id. ¶ 17.

On December 17, 2021, Nutradose purchased the rights to the GLUTADOSE mark from New Vision, including internet domains and social media accounts. Id. ¶ 25. According to Nutradose, Defendants continue to violate the bankruptcy sale by improperly infringing on the GLUTADOSE mark and have unlawfully taken possession of the GLUTADOSE social media accounts and profiles. Id. ¶¶ 27, 29.

As a result of Defendants' alleged actions, Nutradose asserts the following five claims:

1. Federal Trademark Infringement (15 U.S.C. § 1141(a)) (Count I);

2. Common Law Trademark Infringement (Count III);

3. False Designation of Origin (15 U.S.C. § 1125(a)) (Count II);

4. Conversion (Count IV); and

5. Unfair and Deceptive Trade Practices (Fla. Stat. § 501.204) (Count V).

Defendants assert the following six affirmative defenses:

1. Failure to state a claim upon which relief can be granted (First Affirmative Defense) and No damage (Fourth Affirmative Defense);

2. Laches (Second Affirmative Defense);

3. License (Third Affirmative Defense);

4. The GLUTADOSE trademark “was not distinctive at the time of registration of the domain name” (Fifth Affirmative Defense); and

5. Exhaustion/First Sale Doctrine (Sixth Affirmative Defense).

A. The Motions

1. Defendants' Motion

Defendants set forth six primary arguments in support of their Motion. First, Plaintiff lacks standing to bring its claims because the assignment to Plaintiff of the trademark was an invalid “assignment in gross” and because Plaintiff's license to the assignor of the trademark to manufacture GlutaDose Products was an invalid “naked license.” ECF No. [66-1] at 15-18.^[4]Alternatively, Plaintiff lacks standing to bring any claims for any conduct or agreement prior to the date of its assignment, December 17, 2021. Id. at 19-20. Second, summary judgment is warranted on Counts I through III because Defendants sold genuine, unaltered GlutaDose Products, an activity protected by the exhaustion doctrine. Id. at 20-25. Third, Plaintiff has failed to adduce evidence of specific instances of purported infringement of the GLUTADOSE mark, and Plaintiff's infringement claims fail, to the extent that they are premised on Defendants' infringement of the GLUTADOSE marks registered in Mexico, the Dominican Republic, and countries in the European Union as Plaintiff never owned those foreign marks. Id. at 25-34. Fourth, Plaintiff's claim fails under the Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”), Fla. Stat. § 501.201 et seq., Count V, because Defendants' trademark infringement claims fail. Id. at 30. Fifth, Plaintiff's conversion claim, Count IV, also fails because Defendant abandoned the Instagram Accounts and the GlutaDose brand in the Amazon Brand Registry (“Amazon Brand”) before Plaintiff obtained the rights to those accounts and the Amazon Brand. Id. at 30-31. Sixth, Plaintiff's claims are barred by laches. Id. at 32-33. Defendants also seek attorney fees and costs because the instant action is an “exceptional case” justifying the award. Id. at 33.

2. Plaintiff's Motion

In its Motion, Plaintiff advances three sets of arguments. First, Defendants are liable on all Counts in the Complaint. ECF No. [60] at 14-26. Second, several of Defendants' affirmative defenses fail as a matter of law. Third, Plaintiff is entitled to an entry of a permanent injunction against Defendants, a finding that Plaintiff is entitled to recover Defendants' profits and actual damages, and Plaintiff is entitled to its attorney fees and costs.

B. Material Facts

Based on the parties' Statements, Counterstatements, Reply Statements of Material Facts, and evidence in the record, the following facts are not genuinely in dispute unless otherwise noted.

1. Unipharma

Unipharma, LLC (“Unipharma”) is a Florida limited liability company established in Tamarac, Florida in 2012. Pl.'s SMF ¶ 1; Defs.' CSMF ¶ 1. Unipharma owned, managed, and operated a blowfill-seal manufacturing facility that packages pharmaceuticals and nutraceutical oral and ophthalmic solutions. Pl.'s SMF ¶ 1; Defs.' CSMF ¶ 1. Santamarta was the controlling member, officer, and acting president of Unipharma. Santamarta's children were acting members of Unipharma and assumed management roles. Pl.'s SMF ¶ 2; Defs.' CSMF ¶ 2. Santamarta is a manager of, and possesses a 90% stake in, Bio Dose. Pl.'s SMF ¶ 3; Defs.' CSMF ¶ 3.

2. Unipharma Registers the GLUTADOSE Trademark

The parties dispute when Unipharma began manufacturing GlutaDose Products, which are antioxidant dietary supplements. Pl.'s SMF ¶ 6; Defs.' CSMF ¶ 6. On April 2, 2019, Unipharma filed U.S. Trademark Application Serial Number 88/189,823 with the United States Patent and Trademark Office (USPTO) for the mark GLUTADOSE in connection with “dietary supplements with antioxidant and cell protection properties which also supports [sic] the immune system.” Pl.'s SMF ¶ 7; Defs.' CSMF ¶ 7. GLUTADOSE mark is reproduced immediately below.

GlutaDose

ECF No. [1-1].

3. The Trademark License Agreement, Unipharma's Bankruptcy, and the Asset Purchase Agreement

The record reflects that Unipharma licensed the GLUTADOSE mark to Bio Dose, that Unipharma subsequently went bankrupt, and that Unipharma transferred the mark to the entity, New Vision Pharmaceuticals LLC (“New Vision”). According to the Declaration of Alan Petro (“Petro Decl.”), New Vision is a pharmaceutical development and manufacturing company formed in early 2021. Petro Decl. ¶ 3-4, ECF No. [61-1]. On September 13, 2019, a trademark license agreement was executed between Unipharma and Bio Dose that authorized Bio Dose to use the GLUTADOSE trademark (“Trademark License Agreement”). Pl.'s SMF ¶ 9, ECF No. [61]; Defs.' CSMF ¶ 9, ECF No. [75]. The Trademark License Agreement contains no obligations that survive a termination of the agreement. See ECF No. [61-6].

On December 7, 2020, Unipharma filed for Chapter 11 bankruptcy. Pl.'s SMF ¶ 10, ECF No. [61]; Defs.' CSMF ¶ 10, ECF No. [75]. As a result, New Vision acquired the entirety of the GlutaDose line of business and intellectual property, including the underlying formulations, inventory, and the GLUTADOSE Mark, together with all associated goodwill, as part of the bankruptcy court's ordered sale (see generally ECF No. [61-8] (“Court Ordered Sale”)). Pl.'s SMF ¶ 12; Defs.' CSMF ¶ 12. The Court Ordered Sale approved an agreement dated December 7, 2020 (“Asset Purchase Agreement”). Pl.'s SMF ¶ 14; Defs.' CSMF ¶ 14; see also ECF No. [61-8] (“this Court having authorized the Debtors to enter into the Agreement, dated as of December 7, 2020 . . . pursuant to which the [Purchaser] . . . agreed to be the stalking horse bidder with respect to the Purchased Assets . . . with such sale to be in accordance with the terms and conditions of the Agreement[.]”). The Asset Purchase Agreement identifies NHTV (AIV) ULM Bidco LLC as the “Buyer” and Unipharma, and Tamarac 10200, LLC, as the “Sellers” and “Debtors.” ECF No. [1-2] at 7.

NHTV (AIV) ULM Bidco LLC is now known as New Vision. Defs.' CSMF ¶ 56; Pl.'s RSMF ¶ 56.

The Asset...