Protect-A-Car Wash Sys., Inc. v. Car Wash Partners, Inc.

276 F.Supp.3d 439

PROTECT–A–CAR WASH SYSTEMS, INC.

v.CAR WASH PARTNERS, INC., MCW Inc., and John L. Lai

Civil No. 16–cv–534–JFM

United States District Court, D. Maryland.

Signed August 15, 2017

Alexander Craig Vincent, Eric John von Vorys, Shulman Rogers Gandal Pordy and Ecker PA, Potomac, MD, for Plaintiff.

Hugh Jewett Marbury, DLA Piper LLP US, Baltimore, MD, Gina Durham, DLA Piper LLP, San Francisco, CA, Kerry O Neill, Tamar Duvdevani, DLA Piper LLP, DLA Piper LLP, New York, NY, for Defendant.

MEMORANDUM

J. Frederick Motz, United States District Judge

Plaintiff Protect–A–Car Wash Systems, Inc. ("Protect–A–Car") brings suit against Defendants Car Wash Partners, Inc. ("CWP"), and CWP's CEO, John L. Lai ("Lai"). Protect–A–Car alleges claims of: (1) trademark infringement under the Lanham Act; (2) unfair competition under the Lanham Act; (3) cybersquatting in violation of the Anti–Cybersquatting Consumer Protection Act; (4) cancellation of CWP's registration and application under the Lanham Act; and (5) unfair competition under Maryland law. Now pending is Defendants' motion for summary judgment [ECF No. 48], and Protect–A–Car's motion for partial summary judgment [ECF No. 49]. The parties have fully briefed the motions, and no oral argument is necessary. See Local Rule 105.6. For the reasons set forth below, Defendants' motion is granted, and Protect–A–Car's motion is denied.

BACKGROUND

The uncontested facts are as follows. Protect–A–Car Wash Systems, Inc. ("Protect–A–Car" or "Plaintiff") is a corporation that was organized and incorporated under the laws of the District of Columbia on January 12, 1960. [ECF No. 1, ¶ 4]. Protect–A–Car describes its operations as a business "that has been professionally cleaning cars in the greater Washington area since 1958." [ECF No. 48, at p. 6]. Protect–A–Car currently operates six car washes, and all six locations are currently located within 14 miles of Washington, D.C.¹ Id. Plaintiff maintains its principal place of business at 101 North Glebe Road, Arlington, Virginia, 22203. [ECF No. 1, ¶ 4]. Protect–A–Car has been aware of Defendants since approximately 1995, and Defendants explored a possible acquisition of Protect–A–Car in 2000. [ECF No. 48, at p. 8; ECF No. 52, at p. 5].

Defendant Car Wash Partners, Inc. ("CWP") is a corporation that was organized and incorporated under the laws of Delaware on January 16, 1996. [ECF No. 1, ¶ 5]. CWP maintains its principal place of business at 222 East Fifth Street, Tucson, Arizona, 85705. Id. CWP is the nation's largest car wash operator, with 212 car washes and 34 lube centers in 21 states. [ECF No. 48 at p. 4]. Defendant John L. Lai ("Lai") is a natural person who maintains his residence and domicile in Tuscon, Arizona. [ECF No. 1, ¶ 6]. Lai joined CWP in 2002, and was promoted to CEO in 2013. [ECF No. 48, at p. 5].

Plaintiff Protect-A-Car owns federal registrations for two marks: (1) the "MR WASH BRUSHLESS CAR WASH" mark (), acquired in 1987 and used continuously since the late 1960s, and (2) the "MR WASH" word mark, acquired in 2003. [ECF No. 49-1, at p. 4]. Both marks are used in connection with car wash services.

Defendant CWP, in comparison, has used "MISTER CAR WASH" in commerce for at least forty-six years.Id. at 4. Regarding federal trademark registration, however, CWP was denied by the U.S. Patent and Trademark Office ("USPTO") on CWP's first three attempts to register the "MISTER CAR WASH" design mark (), the "MISTER CAR WASH" word mark, and the "MISTER CAR WASH FOR BUSY PEOPLE" word mark. [ECF No. 49-1, at p. 4]. These marks were denied by the USPTO for being too similar to CWP's marks.²Id. In May 2014, however, CWP was successful in obtaining a trademark for the "MISTER CAR WASH" word mark after appealing a USPTO rejection.Id. at p. 5. The stylized trademarks, as generally used in business,³ appear as follows:

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[ECF No. 48, at p. 7; ECF No. 49–1, p. 7–8].

Defendant CWP created the website www.mistercarwash.com in 1996 for use in connection with its business. [ECF No. 48, at p. 5]. In January of 2015, CWP entered the Maryland market for the first time, acquiring two car wash locations ("Maryland Locations") in Severna Park and Annapolis. Id. The Protect–A–Car car wash closest to either of the two CWP Maryland Locations is over 28 miles away. Id. There are several third-party car washes between these two locations as well.⁴ Furthermore, there are other car wash companies, both nationally and within the Washington D.C. metro area, with "MR." and "Wash" as part of their names.⁵ Id. at 7. The vast majority of car wash customers do not frequent car washes that are beyond three miles from their homes, and the statistics diminish even more dramatically after 10 miles. [ECF No. 48–18 ¶ 16]. Despite this, Protect–A–Car has provided some evidence to suggest it has brand awareness and customers outside of this 10–mile radius. For example, there are registered members of Protect–A–Car's "Car Wash Club"—which was discontinued in 2004—that have zip codes in Anne Arundel County. [ECF No. 52, at p. 7]. Furthermore, there are online reviews of Protect–A–Car's services by individuals who identify their locations as being more than 10 miles from a Protect–A–Car car wash. Id.

Protect–A–Car washes over one million cars per year. [ECF No. 48, at p. 10]. Protect–A–Car alleges 22 instances of purported "actual confusion" by customers mixing up CWP and Protect–A–Car. Id. at 9. Only five instances of purported confusion occurred in Maryland. Id. at 10. Of these five instances, two involved an individual purportedly contacting Protect–A–Car in order to cancel a CWP "Unlimited Wash Club" plan.⁶ Id. One instance is an email sent by Protect–A–Car's controller to himself, memorializing a conversation he had with a mistaken individual who believed she was working with Protect–A–Car. Id. Another instance occurred when a CWP customer was mistakenly given a Protect–A–Car location phone number when she called a CWP location to dispute her plan. Id. The final instance of Maryland "confusion" involves an email sent to Steven Harris, owner of Protect–A–Car, from a family friend, Barbara Morrison.⁷ Id. It was revealed at deposition that Barbara Morrison's email was sent after Steven Harris requested her to send it in order to "demonstrate that people are confused"⁸ [ECF No. 52, at p. 11–12]. Steven Harris never mentioned anything to Barbara Harris about this lawsuit. Id. Lastly, Protect–A–Car alleges two additional instances of confusion involving third party suppliers or vendors sending invoices to Protect–A–Car that were apparently meant to go to CWP, or vice versa. Id.

On February 24, 2016, plaintiff Protect–A–Car filed its complaint against CWP and Mr. Lai. [ECF No. 1]. Plaintiff alleges claims of: (1) trademark infringement under Section 32(1)(a) of the Lanham Act, 15 U.S.C.§ 1114(1)(a) ; (2) unfair competition and false advertising under Section 43(a)(1) of the Lanham Act, 15 U.S.C. § 1125(a)(1) ; (3) cybersquatting in violation of the Anti–Cybersquatting Consumer Protection Act, 15 U.S.C. § 1125(d) ; (4) cancellation of CWP's registration and application under Section 37 of the Lanham Act, 15 U.S.C. § 1119 ; and (5) unfair competition under Maryland law. Defendant John Lai filed a motion to dismiss for lack of personal jurisdiction, which was denied by this court on June 16, 2016. [ECF No. 31]. Defendants then filed this instant motion for summary judgment on all counts on February 10, 2017. [ECF No. 48]. Protect–A–Car, in turn, also filed its motion for partial summary judgment on February 10, 2017. [ECF No. 49].

STANDARD

Rule 56(a) of the Federal Rules of Civil Procedure provides the "court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). The Supreme Court has clarified this does not mean that any factual dispute will defeat the motion. "By its very terms, this standard provides that the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (emphasis in original). A genuine issue of material fact exists where, "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. at 247, 106 S.Ct. 2505. The party seeking summary judgment bears the initial burden of demonstrating the absence of a genuine dispute of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).

"A party opposing a properly supported motion for summary judgment 'may not rest upon the mere allegations or denials of [his] pleadings,' but rather must 'set forth specific facts showing that there is a genuine issue for trial.' " Bouchat v. Baltimore Ravens Football Club, Inc., 346 F.3d 514, 522 (4th Cir. 2003) (alteration in original) (quoting Fed. R. Civ. P. 56(e) ). Indeed, the party opposing summary judgment must "do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) ; see also In re Apex Express Corp. , 190 F.3d 624, 633 (4th Cir. 1999). The court must "view the evidence in the light most favorable to ... the nonmovant, and draw all reasonable inferences in her favor without weighing the evidence or assessing the witnesses' credibility," Dennis v. Columbia Colleton Med. Ctr., Inc., 290 F.3d 639, 645 (4th Cir. 2002), but the court also must abide by the "affirmative obligation of the trial judge to prevent factually unsupported claims and defenses from proceeding to trial." Bouchat, 346 F.3d at 526 (internal...