ATTOIR NIEYS AAIT LAW
`
`TTAB
`
`June 16, 5
`
`VIA FEDEX; 791107546257
`
`Commissioner for Trademarks
`
`2900 Crystal Drive
`Alexandria, Virginia 22313-1451
`
`525 MARKET STREET
`SUITE 3600
`
`SAN FRANCISCO, CA 94105-2708
`PHONE 415.848.4900
`FAX 415.848.4999
`
`A LIMITED LIABILITY PARTNERSHIP
`
`DIRECT DIAL 415.848.4928
`
`E-MAIL: buccinol@howrey.com
`
`FILE: 01638.0032.000000
`
`Re:
`
`REQUEST FOR SUSPENSION OF OPPOSITION PROCEEDING PENDING
`RESOLUTION OF POTENTIALLY DISPOSITIVE DISTRICT COURT MOTION TO
`ENFORCE SETTLEMENT
`
`Serial No.: 78/314,247
`
`Mark:
`
`Opposition No. 91 163260
`Opposer: The Coca—Cola Company
`Applicant: Kaveh Harounian
`File No.: 01638.0032.000000
`
`Dear Madam:
`
`Enclosed for filing are:
`
`’—-—j———~—-\
`I|||||l||||||l||||||l||||||ll|||||ll|||||l|||||||l
`
`06-22-2005
`U.S. Patent & TMOfc/TM Mail Rcpt 0t. #11
`
`1.
`
`2.
`
`This letter (in duplicate);
`
`REQUEST FOR SUSPENSION OF OPPOSITION PROCEEDING PENDING
`RESOLUTION OF POTENTIALLY DISPOSITIVE DISTRICT COURT
`
`MOTION TO ENFORCE SETTLEMENT (2 extra copies); and
`
`3.
`
`A self-addressed stamped postcard to evidence receipt.
`
`The Commissioner for Trademarks is hereby authorized to draw on the deposit account
`No. 08-3038, Order No. 01638.0032.000000/Buccino/INLF:371 for any necessary fees.
`
`Please return the enclosed postcard to evidence receipt of the above-mentioned papers.
`
`Enclosure
`
`a S. Buccino
`
`
`
`z--
`
`'
`
`,
`
`/
`
`»
`
`A MSTERDAM
`
`BRUSSELS
`
`CHICAGO
`
`HOUSTON
`
`IRVINE
`
`LONDON
`
`LOS ANGELES
`
`MENLO PARK
`
`SAN FRANCISCO
`
`WASHINGTON, DC
`
`DM_US\82I l705.vl
`
`

`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`HlllllllllllllllHllllllllfllllllllllllllllllllll
`
`06-22-2005
`U.S.Pate t&
`"
`
`.
`TM0fc/TM Maul Rep: 0:. #11
`
`Opposition No. 91163260
`
`Serial No. 78/314,247
`
`§
`§
`
`§ §
`
`§ 2
`
`§ Mark:
`§
`
`§§
`
`§
`
`THE COCA—COLA COMPANY,
`
`Opposer
`
`V.
`
`KAVEH HAROUNIAN,
`
`Applicant
`
`RE UEST FOR SUSPENSION OF OPPOSITION PROCEEDING PENDING
`
`RESOLUTION OF POTENTIALLY DISPOSITIVE DISTRICT COURT MOTION TO
`
`ENFORCE SETTLEMENT
`
`Opposer, The Coca-Cola Company (“TCCC”), through its undersigned attorneys, hereby
`
`l moves the Board pursuant to Rule 117 of the Trademark Rules of Practice, 37 CFR § 2.117, to
`
`suspend this opposition proceeding pending resolution of TCCC’s motion to enforce settlement
`
`in the Central District of California, Case No. CV 03-8219 LGB (SHX). There is good cause to
`
`grant the suspension because if TCCC’s District Court motion to enforce settlement is granted,
`
`this TTAB opposition proceeding will be fully resolved and terminated. In the event TCCC’s
`
`motion to enforce settlement is denied, then either party to this proceeding should be permitted to
`
`file a request that the Board reset all discovery and testimony dates.
`
`BACKGROUND
`
`On November 12, 2003, Applicant, Kaveh Harounian (“Harounian”) commenced a civil
`
`action against TCCC in the United States District Court for the Central District of California,
`
`DM_US\8077265.vl
`
`

`
`
`
`alleging inter alia, that TCCC is infringing Harounian’s alleged rights in the above captioned
`
`design mark (hereinafter the “’247 Design”) and Harounian’s Registration No. 2,204,667 (the
`
`“’667 Vice and Design Registration”).
`
`Subsequently, TCCC filed two actions in the TTAB. First, on November 24, 2003,
`
`TCCC filed a petition to cancel Harounian’s ’667 Vice and Design Registration on the grounds
`
`that Harounian fraudulently represented to the Trademark Office in his application that he had
`
`first used the Vice and Design trademark in interstate commerce on September 1, 1994 on a
`
`variety of apparel items in International Class 25.
`
`(Cancellation No. 92042841) TCCC’s
`
`cancellation petition also alleged that the ’667 Vice and Design Registration had not been in use
`
`as of September 26, 1994 or March 29, 1995 on all the goods identified in Harounian’s
`
`application. The Cancellation action was suspended on April 7, 2005 pending the outcome of
`
`the California District Court litigation.
`
`In addition, TCCC also filed this Opposition on the basis that Harounian made false
`
`statements in the ‘247 application regarding his scope of use of the ‘247 Design mark, and that
`
`any alleged use of the mark occurred after TCCC adopted and began using a design mark on its
`
`POWERADE beverage (subject of U.S. Reg. No. 2,637,060).
`
`On April 12, 2005, the District Court issued a tentative summary judgment ruling that
`
`Harounian had committed fraud in his application to register the Vice and Design trademark, and
`
`that Registration No. 2,204,667 would be cancelled. (Exhibit 1) The next day, on April 13,
`
`2005, TCCC and Harounian negotiated and reached a confidential Settlement Agreement
`
`resolving their disputes in both the litigation and the TTAB proceedings, and requested the Court
`
`not to issue a final ruling on the summary judgment motion. On April 14, 2005, the parties’ filed
`
`a Notice of Settlement with the District Court confirming that they had reached a settlement.
`
`(Exhibit 2) Thereafter, TCCC and Harounian worked on the formal documentation of the
`
`DM_US\8077265.v1
`
`-2-
`
`

`
`settlement. On May 18, 2005, two days after the formal settlement documentation was approved
`
`and circulated for signature, the District Court Clerk unexpectedly filed the Court’s ruling on the
`
`motion for summary judgment. (Exhibit 3) The final ruling departed from the tentative order in
`
`one respect:
`
`the Court found that TCCC had presented clear and convincing evidence of
`
`Harounian’s fraud on the Trademark Office, but that there was an issue for trial based upon
`
`Harounian’s single deposition answer claiming he had used the mark on all fifty of the goods
`
`recited in his application.
`
`Following the unexpected ruling on the motion for summary judgment, Harounian
`
`refused to sign the formal documentation of the settlement reached on April 13”‘. As a result,
`
`TCCC has been forced to file a motion to enforce the settlement agreement. The motion to
`
`enforce is being filed concurrently with this motion to suspend. TCCC’s motion to enforce will
`
`most likely be heard some time in late July or August 2005 after the parties have completed their
`
`briefing and a new district court judge has been assigned to the matter.‘
`
`In any case, the motion
`
`to enforce will not be decided until long after the present deadline for completing discovery in
`
`this proceeding — June 24, 2005.
`
`If TCCC’s motion to enforce the settlement is granted, TCCC’s cancellation and
`
`opposition actions will be fully resolved and no further proceedings will be necessary. Because
`
`the parties’ efforts have been, and continue to be focused on the global settlement reached in the
`
`District Court action, it would be judicially and economically prudent for the Opposition to be
`
`suspended pending the outcome of the TCCC’s motion to enforce.
`
`ARGUMENT
`
`Rule ll7(a) of the Trademark Rules of Practice provides:
`
`1 The judge formerly presiding over the district court litigation has since retired. Thus, the district court has
`informed TCCC that it will assign a new judge to the matter and set a hearing date after TCCC files its motion.
`_3_
`
`DM_US\8077265.vl
`
`

`
`
`
`Whenever it shall come to the attention of the Trademark Trial and
`
`Appeal Board that a party or parties to a pending case are engaged
`in a civil action or another Board proceeding which may have a
`bearing on the case, proceedings before the Board may be
`suspended until termination of the civil action or the other Board
`proceeding.
`
`Subsection (c) further provides that:
`
`Proceedings may also be suspended, for good cause, upon motion
`or a stipulation of the parties approved by the Board.
`
`37 C.F.R. § 2.117 (a), (c).
`
`Under either of these two sections, the present opposition proceeding should be
`
`suspended. The parties have been engaged in litigation before the U.S. District Court in the
`
`Central District of California since November 12, 2003. On April 13, 2005, the parties reached
`
`an enforceable settlement agreement that fully resolves the District Court action and the two
`
`TTAB proceedings between parties concerning Harounian’s ‘247 Application and ‘667
`
`Registration. If the District Court enforces the settlement agreement, the TTAB actions will be
`
`terminated. There is good cause to suspend this proceeding because the pending motion to
`
`enforce the settlement is potentially dispositive of this administrative action. Moreover, since
`
`the motion to enforce will not be resolved until long after discovery closes in this proceeding, it
`
`would be prejudicial and wasteful to require TCCC to conduct unnecessary discovery at this
`
`juncture. TCCC has not taken any discovery in this proceeding to date because it relied on the
`
`fact that the parties had reached a settlement on April 13th.
`
`DM_US\8077265.vl
`
`

`
`CONCLUSION
`
`TCCC requests the Board to order this proceeding suspended pending resolution of
`
`TCCC’s motion to enforce settlement, and that the parties are to report back to the Board on the
`
`status of this proceeding, including whether it is necessary to reset the deposition and testimony
`
`dates, following the District Court’s ruling on the motion to enforce settlement.
`
`Respectfully submitted,
`
`THE COCA-COLA COMPANY
`
`Date:
`
`June 16, 2005
`
`
`
`By:
`
`'
`Robert N. Ph'11ips
`Lisa S. Buccino
`
`HOWREY LLP
`
`525 Market Street, Suite 3600
`
`San Francisco, California 94105
`
`(415) 848-4900
`Attorneys for The Coca-Cola Company
`
`NUMBER: 791107546257 ‘
`
`CERTIFICATE OF FEDERXL EXPRESS
`
`1.10, on the date indicated above, and is addressed to the Commissioner for Trademarks, 2900
`
`DATE OF DEPOSIT: June 16772005
`I hereby certify that this paper is being deposited with the United States Postal Service "Federal Express" service,
`
`DM_US\8077265.vl
`
`

`
`EXHIBIT 1
`
`

`
`S\OO0\lO\U1J>-UJIQ
`
`p_n
`
`;_a
`
`r-A l\)
`
`7-‘ U.)
`
`9-4 -I>
`
`._4 LII
`
`—A O\
`
`p— \l
`
`—-I 00
`
`>—- \O
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`UNITED STATES DISTRICT COURT
`
`CENTRAL DISTRICT OF CALIFORNIA
`
`Kaveh Harounian,
`
`CV 03-8219 LGB (SHX)
`
`Plaintiff,
`
`V.
`
`The Coca—Cola Co.,
`Defendant.
`
`Tentative
`ORDER GRANTING IN PART AND
`DENYING IN PART CROSS-
`MOTIONS FOR SUMMARY
`JUDGMENT
`
`
`
`I .
`
`INTRODUCTION
`
`Plaintiffs, Kaveh Harounian (“Harounian”) and his
`
`Corporation Union Outlet,
`
`Inc.
`
`(“Union Outlet”) allege that the
`
`logo for Coca-Cola Company's
`
`(“Coca-Cola”) PowerAde beverage
`
`infringes on Harounian’s intellectual property rights.
`
`Plaintiffs brought this suit alleging copyright
`
`infringement,
`
`trademark infringement, and related claims.
`
`Coca—Co1a brought
`
`counter~claims for copyright
`infringement and for cancellation of
`state and federal trademark registrations against Harounian and
`
`28 Union Outlet.
`
`Coca-Cola now brings three separate motions for
`
`

`
`)—A
`
`S\DOO\lO\!JI-£>-DJIQ
`
`p_.A
`
`._4
`
`>—- K\J
`
`n—4 U)
`
`>-I A
`
`v-4 U1
`
`r-I O\
`
`>--- \l
`
`—I 00
`
`>—-- \O
`
`Ix) O
`
`[0 >—-
`
`I0I\)
`
`l\)U)
`
`IQ-I>-
`
`[9 U1
`
`t\) O\
`
`I\) \I
`
`[Q 00
`
`summary judgment.
`
`The first is for summary judgment on
`
`Plaintiffs’
`
`copyright
`
`infringement claim,
`
`the second is for
`
`summary judgment on all claims based on Coca—Cola’s affirmative
`
`defenses of unclean hands and laches, and the third is for
`
`summary judgment on Harounian’s trademark claims. Harounian and
`
`Union Outlet bring a motion for summary judgment on Coca—Cola’s
`
`claims to cancel Harounian’s trademark registrations and
`
`copyright
`
`infringement.
`
`II.
`
`FACTUAL AND PROCEDURAL BACKGROUND
`
`The following facts are not in dispute unless so noted.
`
`Harounian owns and operates Union Outlet, a clothing store in the
`
`Los Angeles garment district that has been in operation under
`
`that name since 1996. Harounian incorporated Union Outlet
`
`in
`
`January, 2004. Although Coca—Cola disputes this fact, Harounian
`
`claims to have used a mark he refers to as the Vice logo on his
`
`clothing in the United States since at least September 1, 1994.
`
`The Vice logo includes the word Vice over a design. Harounian
`
`has used the just the design portion of the logo and the design
`
`portion with the word “Vice”.
`
`(Smith Decl. 1, Exhibits 3-4 pages
`
`62-65.) Harounian also uses the Vice logo in different versions,
`
`referred to as the distressed version and the streamlined
`
`version.
`
`See ;g., Exhibit 4 at 63 (left version is distressed,
`
`right version is streamlined or new version); Plaintiffs’
`
`statement of Uncontroverted Facts, #19 (describing which version
`
`is which).
`
`On September 26, 1994 Harounian filed an application with
`
`

`
`the United States Patent and Trademark Office (“PTO”) for a
`
`trademark on the distressed version of the Vice logo. Lg.
`
`Exhibit 5, p.
`
`66.
`
`On November 24, 1998 the PTO registered this
`
`mark under United States Registration No. 2,204,667 (“the ‘667
`
`Registration”).
`
`;g. Exhibit 6. Harounian's application claimed
`
`actual use of the Vice logo on 50 goods including shirts,
`
`topcoats, raincoats, denim jackets, gowns, bathrobes,
`
`tuxedos,
`
`blousons, stockings, earmuffs, and bathing suits in interstate
`
`commerce.
`
`Id. Exhibit 5, p. 66.
`
`Coca-Cola sells a beverage called PowerAde.
`
`In 2000 Coca-
`
`Cola developed a strategy to relaunch PowerAde.
`
`(Phillips Dec.
`
`Exhibit A.) As part of its re-launch it hired Spring Design
`
`Partners (“Spring Design”)
`
`to design a new label for the
`
`beverage.
`
`lg. Preston Depo. 44.
`
`Coca-Cola selected to use
`
`Spring Design’s proposal of the P Icon as a logo for its drink
`
`(hereinafter “PowerAde logo"). Id. Preston Depo. 44, 50.
`
`On
`
`April 26, 2001 Coca-Cola filed an application for trademark
`
`registration of its PowerAde logo with the PTO.
`
`lg. Exhibit N.
`
`The design portion of the streamlined Vice logo and the
`
`PowerAde Logo are nearly identical.
`
`(Smith Decl. 2, Ex 29, pp
`
`1821-38.)
`
`In August 2001 Coca-Cola received a letter from
`
`Harounian's counsel objecting to Coca-Cola's use of the PowerAde
`
`Logo as infringing Harounian’s property rights.
`
`(Phillips Decl.,
`
`Exhibit D—2l.)
`
`On November 12, 2003 Plaintiffs brought this
`
`action.
`
`Harounian filed a combined affidavit of continued use and
`
`\OO0\lO\kI1.J>UJt\)
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`27
`
`28
`
`

`
`,_a
`
`incontestability with the PTO for his trademark on November 24,
`
`2003.
`
`(Smith Decl. 1, Exhibit 7.)
`
`The exhibit attached to this
`
`affidavit shows the streamlined Vice logo. Lg. at 75. Harounian
`
`registered the streamlined Vice logo without the word Vice over
`
`the logo as a trademark with the California Secretary of State on
`
`October 24, 2003 (Smith Decl. Exhibit 8) and registered his
`
`streamlined logo without the word Vice over it as a copyright
`
`with the United States Copyright Office with an effective date of
`
`November 20,
`
`2003.
`
`lg. Exhibit 10.
`
`Coca-Cola registered its
`
`PowerAde logo with the United States Copyright Office with an
`
`effective date of May 17,
`
`2004.
`
`(Phillips Decl. Exhibit H.)
`
`Plaintiffs filed the second amended complaint
`
`(“2A
`
`Complaint") on October 15,
`
`2004.
`
`The 2A Complaint alleges (1)
`
`copyright
`
`infringement under 17 U S.C.
`
`§ 501;
`
`(2)
`
`trademark
`
`infringement and false designation of origin under 15 U.S.C.
`
`§
`
`1125(a);
`
`(3)
`
`trademark infringement under Cal. Bus. & Prof. Code
`
`§§ 14320 and 14340;
`
`(4) unfair competition under Cal. Bus. &
`
`Prof. Code §§ 17200 et seq.;
`
`(5)
`
`common law trademark
`
`infringement and unfair competition; and (6) unjust enrichment
`
`and constructive trust.
`
`On October 15, 2004 Coca-Cola filed a
`
`first amended counterclaim (“1A Counterclaim") against Harounian
`
`and Union Outlet.
`
`The 1A Counterclaim asserts affirmative
`
`defenses including fraud, abandonment, unclean hands,
`
`laches, and
`
`estoppel.
`
`The 1A Counterclaim also brings claims against
`
`Harounian and Union Outlet for (1) cancellation of Harounian’s
`
`federal trademark for the mark “Vice and Vice Logo”,
`
`(2)
`
`O\OOO\]0\Lh~l>UJl\)
`
`>-I
`
`p_n
`
`p_a
`
`—- I\)
`
`o— U3
`
`>-I -I5
`
`r—- LII
`
`r—A O\
`
`>-I \l
`
`r—- 00
`
`r-- V0
`
`(0 0
`
`I9 v—I
`
`I0I\)
`
`I\)U3
`
`IV-5-
`
`l\J 'J\
`
`l\) O\
`
`I\.) \]
`
`l\) 00
`
`

`
`cancellation of Harounian’s California trademark Registration for
`
`the “Vice Logo" under Cal. Bus. & Prof. Code § 14281; and (3)
`
`Copyright
`
`infringement under 17 U.S.C.
`
`§ 501 based on use of the
`
`Vice Logo.
`
`On February 14, 2005 Harounian and Union Outlet, Inc. filed
`
`a motion for summary judgment on Coca—Cola’s claims to cancel
`
`Harounian’s trademark registration under both state and federal
`
`law.
`
`On the same day Coca-Cola filed three motions for summary
`
`judgment. Coca—Cola’s first motion argues that Plaintiffs cannot
`
`succeed on claims for copyright
`
`infringement. Coca—Cola’s second
`
`motion argues it is entitled to summary judgment on all of
`
`Harounian’s claims on the affirmative defenses of unclean hands
`
`and laches. Coca—Cola’s third motion argues that Harounian’s
`
`trademark claims must fail because his trademarks are invalid and
`
`that it must prevail on its claim to cancel Harounian’s trademark
`
`registration. All motions were fully briefed.
`
`The Court
`
`considers these related motions in this Order.
`
`III. LEGAL STANDARD
`
`Rule 56 of the Federal Rules of Civil Procedure provides
`
`that a court shall grant a motion for summary judgment if “the
`
`pleadings, depositions, answers to interrogatories, and
`
`admissions on file,
`
`together with the affidavits,
`
`if any,
`
`show
`
`that there is no genuine issue as to any material fact and that
`
`the moving party is entitled to judgment as a matter of law.”
`
`Fed. R. Civ. P. 56(c). Material facts are those that may affect
`
`the outcome of the case. Anderson v. Liberty Lobby, Inc., 477
`
`\OOO\)O\UI-D-UJK\)
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`
`U.S. 242, 248 (1986).
`
`A dispute as to a material fact is genuine
`
`if there is sufficient evidence for a reasonable jury to return a
`
`verdict for the nonmoving party. Lg;
`
`The party moving for summary judgment bears the initial
`
`burden of informing the district court of the basis of the
`
`summary judgment motion and of demonstrating the absence of a
`
`genuine issue of material fact for trial. Celotex Corp. v.
`
`Catrett, 477 U.S. 317, 323 (1986); Katz v. Children's Hosp. of
`
`Orange County,
`
`28 F.3d 1520, 1534 (9th Cir. 1994). On an issue
`
`for which the non-moving party has the burden of proof at trial,
`
`the moving party need only point out “that there is an absence of
`
`evidence to support the non—moving party's case.”
`
`Celotex, 477
`
`U.S. at 325.
`
`Once this initial burden is satisfied,
`
`the non-moving party
`
`must “go beyond the pleadings and by her own affidavits, or by
`
`the depositions, answers to interrogatories, and admissions on
`
`file, designate ‘specific facts’ showing that there is a genuine-
`
`issue for trial." Celotex,
`
`477 U.S; at 324 (internal quotations
`
`omitted); see also Nilsson, Robbins, Dalgarn, Berliner, Carson &
`
`Wurst v. Louisiana Hydrolec, 854 F.2d 1538, 1544 (9th Cir. 1988).
`
`Where the standard of proof at trial is preponderance of the
`
`evidence,
`
`the non-moving party's evidence must be such that a
`
`“fair—minded jury could return a verdict for the [non-moving
`
`party] on the evidence presented.” Anderson, 477 U.S. at 252.
`
`The Court views all facts and draws all inferences therefrom
`
`in the light most favorable to the non-moving party.
`
`United
`
`states v. Diebold, Inc., 369 U.S. 654, 655(1962).
`
`The Court must
`
`1 2 3 4 5 6 7 8 9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`

`
`I
`
`accept
`
`the plaintiff's view of all material disputed facts.
`
`2 LaLonde v. County of Riverside, 204 F.3d 947, 954 (9th Cir.
`
`3 2000).
`
`If, however,
`
`the nonmoving party's evidence is “merely
`
`4
`
`5
`
`6
`
`7
`
`colorable” or “not significantly probative,” summary judgment may
`
`be granted. Anderson, 477 U.S. at 249-50.
`
`IV.
`
`ANALYSIS
`
`A. Coca—Cola’s First Motion §Harounian’s Claim for
`
`Co
`ri ht Infrin ement
`8
`two elements
`In order to establish copyright infringement,
`IE
`11 must be shown:
`(1) ownership of a valid copyright; and (2)
`12
`copying of constituent elements of the work that are original.
`13 Feist Publications,
`Inc. v. Rural Tel. Serv. Co., 499 U.S. 340,
`14
`361 (1991). Plaintiff may show copying by establishing that
`15 defendant
`(1) had access to the plaintiff's work and (2)
`that the
`
`15
`
`two works are substantially similar in their protected elements.
`
`17 Rice v. Fox Broadcasting Company, 330 F.3d 1170, 1174 (9th Cir.
`
`18 2003). Absent evidence of access, a “striking similarity"
`
`19 between the works may give rise to a permissive inference of
`
`20
`
`21
`
`copying. Baxter v. MCA, Inc., 812 F.2d 421, 424 n2
`
`(9th Cir.
`
`1987).
`
`The defendant may rebut the presumption of copying with
`
`22 proof of independent creation. Three Boys v. Bolton, 212 F.3d
`23
`477, 486 (9th Cir. 2000).
`::
`For purposes of this motion for Summary Judgment as to its
`
`claim for Copyright infringement only, Coca-Cola does not dispute
`
`26
`
`27
`
`28
`
`that Harounian owns a valid copyright and that the parties’
`respective works are substantially similar.‘
`(Coca-Cola Motion
`
`
`
`‘Since Coca-Cola does not contest the validity of Harounian’s federal copyright, the
`
`7
`
`

`
`1,
`
`at 9 n8.)
`
`Coca—Cola alleges that Harounian cannot show that
`
`Coca—Cola had access to Harounian’s work during the relevant time
`
`and that he cannot show a genuine issue regarding the independent
`
`creation of the PowerAde logo.
`
`1 .
`
`ACCESS
`
`To determine access, courts consider whether the person who
`
`created the allegedly infringing work had a reasonable
`
`opportunity to view the copyrighted work. Three Boys Music Corp.
`
`V. Bolton, 212 F.3d 477, 482 (9th Cir. 2000).
`
`A bare possibility
`
`will not suffice; neither will a finding of access based on
`
`speculation or conjecture.
`
`Id. Circumstantial evidence of
`
`reasonable access may be proved where the plaintiff's work has
`
`been widely disseminated.
`lg;
`Harounian designates two sets of facts to establish access
`
`of its Vice logo:
`
`(1)
`
`the sales of merchandise carrying the Vice
`
`logo between 1996 and 2001 were substantial and broad and (2)
`
`‘Plaintiffs’ advertising and website effectuated the wide
`
`dissemination of its Vice logo.
`
`(Opposition to Coca—Cola Motion
`
`1, at 14).
`
`a.
`
`Sales
`
`Whether a particular level of sales constitutes wide
`
`dissemination is a fact specific determination. Compare Rice v.
`
`Fox Broadcasting Co., 330 F.3d 1170, 1178 (9th Cir. 2003)
`
`(finding that 17,000 copies of a video sold within a span of
`
`
`version of the Vice logo shown in the copyright application (Phillips Decl. Exhibit 1) which
`
`shows the streamlined design without the word Vice above it, is the mark at issue in this
`
`discussion.
`
`

`
`
`
`thirteen years cannot be considered widely disseminated) and
`775-777 (C.D. Cal. 1981)
`
`526 F.Supp. 774,
`
`Jason v. Fonda,
`
`KOOO\lO\UI-RUJIQ
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`26
`
`27
`
`28
`
`(finding that 200-700 copies of a book available at various
`
`booksellers in the southern California area insufficient to
`
`establish a reasonable inference of access) with Ode ard Inc. v.
`
`Costikyan Classic Carpets, Inc., 963 F.Supp.
`1997)
`(finding wide dissemination where copyrighted work appeared
`
`1328, 1336 (S.D.N.Y.
`
`in a showroom and a carpet show that defendants were known to
`
`have visited) and Peel & Co.,
`
`Inc. v. The Rug Market, 238 F.3d
`
`391, 393 (5th Cir. 2001)
`
`(finding wide dissemination where 4000
`
`rugs were sold within 8 years and samples of the rug appeared in
`
`over 100 showrooms).
`
`Harounian presents evidence that his gross sales between
`
`1996 and 2001 consisted of: $71,424 (1996); $239,134 (1997);
`
`$284,253 (1998); $457,601 (1999); $372,298 (2000); and $305,653
`
`(2001).
`
`(Opposition at 14; Philips Decl., Exhibit D-36.)
`
`Harounian states that at least seventy—five percent of
`
`Plaintiffs’ gross sales were derived from products bearing the
`
`Vice logo and that merchandise bearing the Vice logo has sold -
`
`across the United States and has been widely disseminated.
`
`(Phillips Decl., Harounian Depo. at 32, deposition page 123:5—11;
`
`and at 40, deposition page 156:1—7.) Harounian's failure to
`
`identify the number of units sold in these areas makes it
`
`difficult to establish the extent of his dissemination.
`
`ggg
`
`Rice, 330 F.3d at 1179 (17,000 copies of videos sold); Jason, 526
`
`F.Supp. at 776 (200—700 copies of book); Peel & Co., 238 F.3d at
`
`393 (400 rugs sold).
`
`Furthermore, Harounian’s gross sales
`
`

`
`amounts do not indicate whether his logo was distributed in areas
`
`l\>
`
`where Coca—Cola or Spring Partners employees were likely to
`
`\O0O\]O\UI-kl»
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`encounter them or how many units were distributed in those areas.
`
`Therefore,
`
`this evidence is not sufficient to establish a genuine
`
`issue regarding access.
`
`b. Advertising
`
`Harounian also attempts to show wide dissemination of his
`
`logo by virtue of his advertising Via flyers and a website.
`
`(Phillips Decl
`
`, Harounian Depo. at 46, deposition page 181:1—5,
`
`and 53-55.) Harounian claims he distributed flyers in three
`
`ways:
`
`(1)
`
`from his store in Los Angeles;
`
`(2)
`
`through the mail;
`
`and (3) at trade shows.
`
`(id; at 54, deposition page 2l2:13—l7.)
`
`Harounian does not present evidence showing where his mailings
`
`were sent, where the trade shows he attended were located, or why
`
`it is likely that the flyers distributed in his Los Angeles store
`
`were available to Coca—Cola or Spring Design’s employees who were
`
`on the east coast.
`
`In addition to flyers, Harounian argues that his company's
`
`website disseminated the Vice logo.
`
`(ggg Opposition at 14.)
`
`Harounian does not point to any facts in the record to indicate
`
`that the Vice logo appeared on the website at that time.
`
`Accordingly, Harounian’s references to his website do not show
`
`Defendant's access to the Vice logo.
`
`Harounian’s evidence of sales and advertising is not
`
`sufficient for a reasonable jury to find that Coca—Cola had
`
`access to the Vice logo and therefore Harounian does not show
`
`evidence of copying by showing access and substantial similarity.
`
`10
`
`

`
`Harounian does not argue that the marks are so strikingly similar
`
`that access must be inferred under §a§;g;_yg_MQAL_;ng;, 812 F.2d
`
`421,
`
`424 n2 (9th Cir.
`
`1987) and therefore the Court does not
`
`consider this theory.2
`
`(gee Opposition to Coca—Cola Motion 1 at
`
`14-15 (mentioning strikingly similar doctrine and Baxter one time
`
`but arguing substantial similarity in the same paragraph and the
`
`following paragraph).
`
`Since Harounian has not presented any
`
`evidence of copying, Coca-Cola’s motion for summary judgment on
`
`Harounian’s claim for copyright
`
`infringement is GRANTED.
`
`B. Coca-Cola’s Second Motion §Unclean Hands & Laches)
`
`Coca-Cola’s second motion requests summary judgment on all
`
`of Harounian’s claims based on the affirmative defenses of
`
`unclean hands and laches.
`
`1. Unclean Hands
`
`Unclean hands is an equitable affirmative defense.
`
`To
`
`prevail on an unclean hands defense for trademark infringement, a
`
`party seeking this defense must have acted fairly and without
`
`fraud or deceit as to the controversy in issue. Levi Strauss &
`
`2Even if the Court found that the works were strikingly similar it would not necessarily
`
`find sufficient evidence of copying. “[A]lthough it has fiequently been written that strikingly
`
`similarity alone can establish access, the decided cases suggest that this circumstance would be
`
`most unusual. The plaintiff must always present sufficient evidence to support a reasonable
`
`possibility of access because the jury carmot draw an inference of access based upon speculation
`
`and conjecture alone.” Selle v. Gibb, 741 F.2d 896, 901 (7th Cir. 1984). Since Harounian has
`
`not provided evidence of access, it is unlikely that the Court could find that striking similarity of
`
`the logos is sufficient evidence to show copying.
`
`ll
`
`

`
`Co. V. Shilon & Co.,
`
`121 F.3d 1309,
`
`1313 (9th Cir.
`
`1997).
`
`To
`
`establish an unclean hands affirmative defense,
`
`the defendant
`
`must demonstrate that the plaintiff's conduct is inequitable and
`
`that the conduct relates to the subject matter of its claims.
`
`gg.
`
`Coca—Cola presents four grounds for its unclean hands
`
`defense.
`
`_ First, Coca—Cola alleges that Harounian’s made fraudulent
`
`misrepresentations in his federal trademark application.
`
`Fraud
`
`in a pending application to register a trademark is not related
`
`to the claim for trademark infringement and therefore not
`
`sufficiently related to Harounian’s claims to constitute an
`
`unclean hands defense.
`
`McCarthy on Trademarks and Unfair
`
`Competition § 31:59
`
`(2004)
`
`citing Paramount Pictures Corp. v.
`
`Dorney Park Coaster Co.,
`
`698 F.
`
`Supp.
`
`1274,
`
`1285-1286 (E.D. Pa.
`
`1988).
`
`Second, Coca—Cola alleges Harounian knowingly misused the
`
`“R”
`
`trademark symbol with logos which were not federally
`
`registered.
`
`(Coca—Cola Motion 2 at 13). Using the trademark
`
`symbol while knowing that the mark has not been registered can
`
`constitute unclean hands.
`
`See Urecal Corp. V. Masters, 413
`
`F.Supp. 873, 875 (N.D. Ill. 1976). However,
`
`in this case,
`
`Harounian had registered a trademark on the word Vice over a
`
`design and used the trademark symbol on the design part only,
`
`which was a portion of the trademark but not the whole. This act
`
`does not constitute the level of deceit necessary for unclean
`
`hands.
`
`Third, Coca—Cola alleges Harounian violated California Labor
`
`\OOO\lO\UI-bUJl\J
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`12
`
`

`
`
`
`1
`
`8\O0O\lO\U1-I>U~)I\J
`
`p_n
`
`p_;
`
`r4 IQ
`
`r-—I UJ
`
`r-I -A
`
`pa KJI
`
`>—- O‘\
`
`r-A \l
`
`—I 00
`
`>--- \D
`
`NO
`
`N —I
`
`l\)N
`
`l\) OJ
`
`N-J>
`
`l\) U!
`
`I\) O'\
`
`Codes by not having a license to manufacture and not keeping
`
`detailed records of his employees.
`
`(Coca—Cola Motion 2, at 13-
`
`16.) Harounian’s alleged failures to comply with these state
`
`laws are unconnected to his charges of trademark infringement,
`
`and do not constitute an unclean hands defense in these claims.
`
`See Powell v. Mobile Cab & Baggage Co.,
`
`263 Ala. 476, 480-81, 107
`
`USPQ 229 (1955)
`
`(violation of law requiring the obtaining of a
`
`license to do business did not constitute unclean hands); United
`
`States Light & Heating Co. V. Untitled States Light & Heating
`
`Co., 181 F.182, 187 (C.C.D.N.Y. 1910)
`
`(violation of law requiring
`
`license and payment of state taxes did not constitute unclean
`
`hands).
`
`Finally, Coca—Cola argues that Harounian altered his mark
`
`from the distressed to the streamlined look to more closely
`
`resemble Coca—Cola’s logo in an effort to bolster his
`
`infringement case.
`
`(Coca—Cola Motion 2, at 16). Altering a mark
`
`prior to litigation to look like a competitor's mark is a valid
`
`basis for an unclean hands defense.
`
`See Kendall—Jackson Winery
`
`V. E.
`
`& J. Gallo Winery , 150 F.3d 1042, 1053 (9th Cir. 1998)
`
`(affirming district court's application of an equitable defense
`
`based on such facts); Metro Publ’g V. San Jose Mercury News, 861
`
`F. Supp. 870, 880 (N.D. Cal. 1994).
`
`Coca—Cola argues that
`
`Harounian has no evidence that he used the streamlined version of
`
`his logo that is very similar to the PowerAde logo before 2001,
`
`when Coca—Cola started using its PowerAde logo, and therefore
`
`Harounian altered his logo to match the PowerAde logo.
`
`(Coca-
`
`Cola Motion 2, at 16-18).
`
`Harounian presents the following evidence that he used the
`
`13
`
`

`
`\OOo\lO\'J\J>UJl\9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`streamlined logo before PowerAde began using the logo in 2001:
`
`the deposition of Robert Lanfield stating that he has seen the
`
`streamlined Vice logo on Harounian's hangtags since 1996 or 1997
`
`(Smith Dec. Exhibit 16 at 120-22, deposition pages 106-108);
`
`the
`
`deposition of Behrouz Beizai, an independent salesman, who
`
`remembered seeing the streamlined Vice logo on Harounian's
`
`hangtags since he started associating with Harounian in 1996 or
`
`1997 (Smith Dec. Exhibit 14 at 112, deposition page 168); and
`
`Harounian's father's testimony that Harounian used this logo as
`
`early as 1996 (Smith Dec. Exhibit 12 at 98-99, deposition pages
`
`67-68). These statements are sufficient to raise a genuine issue
`
`of fact whether Harounian used the streamlined version of his
`
`logo before Coca—Cola began using the PowerAde logo.
`
`Summary
`
`judgment is DENIED based on this affirmative defense.
`
`2. Laches
`
`In a trademark action, a defendant can show the affirmative
`
`defense of laches by showing that an unreasonable delay by
`
`plaintiff in filing suit resulted in prejudice to Defendant.
`
`Clamp Mfg. Co. V. Enco Mfg. Co.,
`
`870 F.2d 512, 515 (9th Cir.
`
`1989).
`
`The Ninth Circuit has stated that in deciding whether
`
`laches applies,
`
`the court should weigh the following factors:
`
`(1)
`
`the strength of the plaintiff's trademark;
`
`(2) plaintiff's
`
`diligence in enforcing the mark;
`
`(3)
`
`the harm to the plaintiff if
`
`relief is denied;
`
`(4) whether defendant acted in good faith
`
`ignorance of plaintiff's right;
`
`(5) competition between the
`
`parties; and (6)
`
`the harm suffered by defendant because of the
`
`plaintiff's delay.
`
`lg. Laches may be determined on summary
`
`judgment. American