Trademark Trial and Appeal Board Electronic Filing System. http://estta.uspto.gov
`ESTTA931897
`10/30/2018
`
`ESTTA Tracking number:
`
`Filing date:
`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`Proceeding
`
`91236668
`
`Party
`
`Correspondence
`Address
`
`Defendant
`LaGree Technologies, Inc.
`
`CHAD E ZIEGLER
`NEUSTEL LAW OFFICES LTD
`2534 SOUTH UNIVERSITY DRIVE, SUITE 4
`FARGO, ND 58103
`UNITED STATES
`michael@neustel.com, jason@neustel.com, chad@neustel.com
`701*281-8822
`
`Submission
`
`Filer's Name
`
`Filer's email
`
`Signature
`
`Date
`
`Attachments
`
`Reply in Support of Motion
`
`Jason L. Gilbert
`
`jason@neustel.com, michael@neustel.com, oppositions@neustel.com,
`chad@neustel.com
`
`/jlg/
`
`10/30/2018
`
`2018-10-30 Lagree Reply Brief in Support of Motion to Amend An-
`swers.pdf(710701 bytes )
`2018-10-30 Exhibits - Amend Reply Brief.pdf(2698374 bytes )
`2018-10-30 Neustel Declaration.pdf(282385 bytes )
`
`

`

`
`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`
`Coreology, Inc.,
`
`
`Opposer,
`
`
`v.
`
`Lagree Technologies, Inc.,
`
`
`Applicant.
`
`
`Consolidated
`Opposition No. 91236668 (Parent)
`Opposition No. 91236942
`Opposition No. 91238139
`
`
`
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`
`LAGREE’S REPLY BRIEF IN SUPPORT OF
`MOTION FOR LEAVE TO AMEND ITS ANSWERS
`
`Coreology has no reasonable argument that Lagree’s proposed pleadings fail to provide
`
`notice of the basis of its licensee estoppel defense, or that they do not on their faces recite a
`
`plausible defense. Coreology instead has chosen to prematurely argue the merits of the defense
`
`under the guise of “futility” even though the relevant authorities clearly hold determination on
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`the merits at this stage is irrelevant.
`
`Coreology now contends it has “never been a licensee of Lagree.” However, Coreology
`
`admitted to being a “licensee” just prior to initiating these proceedings. Coreology’s shifting
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`sands approach to its licensee status is improper and should not be rewarded.
`
`A.
`
`Coreology Incorrectly Cites the Motion for Summary Judgment Standard.
`
`Quoting Wilson v. Am. Trans Air, Inc. (7th Circuit), Coreology incorrectly takes the
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`position that an amendment is futile “if the amended pleading could not survive a motion for
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`summary judgment.” (Coreology’s Opp., p. 7.) However, 7th Circuit Courts after Wilson have
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`made clear that the proper standard is the standard for a motion to dismiss.1 The same standard
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`
`
`1 “[T]he parties have not yet moved for summary judgment, and whether the amendment would
`survive a motion to dismiss is the proper standard.” King v. Indiana Supreme Court, 2014 WL
`5798583, n. 2 (S.D.Ind. 2014).
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`has also been repeatedly applied by the TTAB.2 Under the proper standard, the only question to
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`be determined is whether taking the allegations pled as true and drawing all inferences in favor
`
`of the pleader, do they state a legally plausible defense. 3 Whether the pleader may ultimately be
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`successful in proving them at trial is irrelevant.
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`We are also still in a stage of the opposition proceedings with significant discovery
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`remaining between the parties, including a pending Motion to Compel waiting to be decided.
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`(34 TTABVUE.) Lagree is likely to prevail on the licensee estoppel defense not only in
`
`response to a motion for summary judgment but at trial. However, the motion to dismiss
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`standard currently applies to Lagree’s proposed amended pleadings until that time.
`
`B.
`
`Lagree’s Three Amendments Properly Plead a License to the Marks at Issue.
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`Coreology’s argues that “Lagree has failed to plead that the Opposer was a licensee
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`under any of the alleged marks at issue in this opposition.” (Coreology Resp., p. 9.) However,
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`this is a consolidated opposition proceeding with three trademark oppositions each directed at a
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`separate trademark application. (Opposition Nos. 91236668, 91236942 and 91238139.)
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`Individually and for each of the three trademark oppositions against the SCRAMBLED
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`EGGS, WHEELBARROW and SPIDER LUNGE trademark applications, Lagree has proposed
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`the following amendment (Exs. A-F):
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`THIRD AFFIRMATIVE DEFENSE
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`
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`The First Amended Notice of Opposition is barred, in whole or in part, by
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`the equitable defense of estoppel licensee estoppel. At the time of filing the
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`Notice of Opposition, Opposer was a licensee of Applicant.
`
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`2 Mitek Corp. v. Woods Industries Inc., 41 USPQ2d 1307 (TTAB 1996); Dee Howard v. Kaim &
`Associates International Marketing, Inc., 2005 WL 1527781 (TTAB June 24, 2015).
`3 “[T]he standard for considering the motion [to dismiss] is still whether the complaint states a
`plausible claim for relief.” Guess? IP Holder L.P. v. Knowluxe LLC, 116 U.S.P.Q.2d 2018, 2019
`(TTAB 2015).
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`Since each individual opposition filed by Coreology relates to only one individual
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`trademark application for one individual mark (SCRAMBLED EGGS, WHEELBARROW or
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`SPIDER LUNGE), it is impossible to believe that Coreology would not be placed on notice of
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`the basis for the defense. It is simply obvious from and inherent in the licensee estoppel defense
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`as pled that Opposer is a licensee as to the mark at issue in each individual Opposition in which
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`the defense is pled. The parties should not have to fight over something usually stipulated to.
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`Coreology quotes Creative Gifts to support its argument that opposition of unlicensed
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`trademarks would not give rise to licensee estoppel and that each trademark should have been
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`specifically pled. (Coreology Resp., p. 9.) However, Creative Gifts does not address the issue of
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`unlicensed trademarks anywhere in the opinion, nor does it address a supposed requirement that
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`a pleading include the specific trademarks licensed. See Creative Gifts, Inc. v. UFO, 235 F.3d
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`540 (10th Cir. 2000). Creative Gifts actually supports the position that licensee estoppel bars
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`challenging a trademark based on a naked licensing argument by a licensee. Id. at 548. Thus,
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`Creative Gifts actually supports the TTAB concluding that licensee estoppel as pled sets out a
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`plausible affirmative defense.
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`There is not much TTAB case law on this issue since most parties simply stipulate to
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`such amendments. However, the TTAB has found that licensee estoppel was sufficiently pled
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`even though the Applicant never expressly pled a license, licensee estoppel or the specific
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`licensed trademark. See Biomedical Research Laboratories, LLC v. Howard J. Nemovitz, Opp.
`
`No. 91216751, 2015 WL 9906648, at *5 (TTAB Sept. 22, 2015).
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`The TBMP states “[t]he elements of a defense should be stated simply, concisely, and
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`directly. However, the pleading should include enough detail to give the plaintiff fair notice of
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`the basis of the defense.” TBMP 311.02(b). Lagree has done just that with its proposed
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`amendment for each of the three individual Answers. Coreology has also shown that it is on full
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`notice of the basis of Lagree’s defense by improperly arguing4 against it in their opposition brief.
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`Although Lagree does not believe it is necessary, if the Board would like Lagree to
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`further clarify in each of the amended Third Affirmative Defenses that the mark in the opposed
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`application is the mark to which the license applies, Lagree is agreeable to adding further
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`clarifying language so that Coreology cannot claim it does not understand.
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`C.
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`Coreology Was a Licensee When the Oppositions Were Filed.
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`The language of the pleadings is the appropriate focus to determine the present Motion
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`and consideration of the facts that may ultimately be proven at trial is both unnecessary and
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`irrelevant. Nevertheless, Coreology has expended much effort arguing the evidence related to its
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`licensee status. Even considering the evidence as it currently exists with limited document
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`production from Coreology, and without discovery completed, the proposed licensee estoppel
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`defenses clearly are not futile.
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`1.
`
`Coreology Admits It Is a “Licensee”.
`
`While Coreology has been enjoying use of Lagree’s trademark license for Coreology’s
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`Palos Verdes studio since 2010, it now takes the inherently conflicting position with the TTAB
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`that it has “never been a licensee.” (Coreology Resp., p. 1.) Depending on its situation,
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`Coreology has now taken three different positions as to its licensee status with Lagree:
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`“licensee”, “former licensee” and now “never been a licensee.”
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`On March 9, 2017, Coreology argued it was a “licensee” in response to a cease and desist
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`letter from Lagree to Coreology regarding Coreology’s unauthorized usage of Lagree’s
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`trademarks in a second unlicensed studio in Manhattan Beach. Coreology stated “Ms. Martz is a
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`
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`4 “[T]he nonmoving party should not argue against granting the moving party leave to amend
`merely because the nonmoving party believes the moving party will not be able to prove the
`additional claim or allegations at trial.” TBMP 507.02
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`licensee of Lagree’s Megaformer for her studio in Palos Verdes. Accordingly, it was
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`appropriate for Ms. Martz to use the Megaformer mark in connection with the “Megaformer”
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`classes offered at her Palos Verdes studio ….” (Ex. G3, p. 3.) (emphasis added.)
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`However, Coreology has also repeatedly stated that Coreology, Inc. – not Sarah Martz
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`personally – “opened”, “owns” and “operates” the Palos Verdes studio. (Exs. G1, G2, p. 4, Ex.
`
`G2, p. 3, Coreology Resp., p. 3 and Coreology’s Ex. A, S. Martz Decl. at ¶ 1; See also
`
`Coreology’s Notice of Oppositions, 18 TTABVUE 3, ¶5, Opp. No. 91236668; 16 TTABVUE
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`10, ¶5, Opp. No. 91236942; 12 TTABVUE 10, ¶5, Opp. No. 91238139.) Putting aside the
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`obvious alter ego implications, at least as of March 9, 2017 Coreology admitted that Coreology,
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`Inc. was an active “licensee” of Lagree’s trademarks.
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`In August 2018, approximately a year after the Oppositions were filed, Coreology argued
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`it was a “former licensee” in response to Motions to Quash subpoenas Coreology served on
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`third-parties seeking Lagree’s confidential information. (Ex. G1, p. 4 and Ex. G2, p. 4.) In
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`particular, Coreology told the U.S. District Court for the District of Oregon that “Coreology,
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`Inc., owns an exercise studio in the Los Angeles area, and Coreology is a former
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`licensee/affiliate of Lagree Fitness.” (Ex. G1, p. 4 and Ex. G2, p. 4.) (emphasis added.) In a
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`separate matter against a Lagree licensee, in January 2018, Coreology told the U.S. District
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`Court for the Central District of California that “Coreology was formerly a licensee of Lagree
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`Fitness, Inc. and its predecessor.” (Exhibit G2.) (emphasis added.) Interestingly, Coreology has
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`never identified any evidence showing its license was terminated.
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`2.
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`Lagree’s License and License FAQ Provided to Coreology.
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`In addition to Coreology’s recent admissions, the June 2010 license (“2010 License”)
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`expressly states that Sarah Martz (“an individual/company”) is the licensee. (Coreology Resp.,
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`Ex. A5.) Clearly the parties anticipated that Ms. Martz would do business under the license as a
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`“company,” and that company was subsequently named Coreology, Inc. Id. In early August
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`2010, a commercial lease for the Palos Verdes studio identified the Lessee as “Laura Martz and
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`Sarah Martz d.b.a. as Coreology.” (Ex. H.) (emphasis added.) Coreology enjoyed the benefits
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`of the license from Lagree since 2010 to present with its licensed Palos Verdes studio that it
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`“opened”, “owns” and “operates.” (Exs. G1, G2, p. 4, Ex. G2, p. 3, Coreology Resp., p. 3 and
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`Coreology’s Ex. A, S. Martz Decl. at ¶ 1.)
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`Coreology argues that the 2010 License and none of the materials provided to it reference
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`trademarks. However, Coreology received Lagree’s frequently asked questions (“License
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`FAQ”) together with the license. (Coreology Resp., Ex. A4, S. Martz Decl. at ¶¶ 3, 4.) The
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`License FAQ clearly stated that Lagree was “a licensing opportunity,” and that it included
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`“[l]icensing of all branded materials.” Id. at p. 1. The License FAQ even specifically references
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`some of the trademarks that are licensed and how they can be used. Id. at p. 2.
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`3.
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`Coreology Knew It Was a Licensee and That It Needed a License to Operate
`Studios Using Lagree’s Trademarks – With or Without Lagree Machines.
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`Coreology argues that it was basically just purchasing exercise machines without any
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`rights to the Lagree trademarks and that any license that existed was only with Ms. Martz.
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`(Coreology Resp., pp. 3, 4, 10.) However, in September 2015 when Coreology wanted to open a
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`new studio in Manhattan Beach, Ms. Martz sent an email to Lagree requesting if any “licenses
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`open and available yet” for “Manhattan Beach and El Segundo?” (Ex. L1.) Later, Coreology
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`again requested how to get a license for the already operating Manhattan Beach studio even
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`though “[t]he studio is not using any Lagree equipment.” (Ex. L2, p. 2.)
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`Since entering into the license agreement with Lagree, Coreology has extensively used
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`the licensed Lagree trademarks including SCRAMBLED EGGS in various advertisements for its
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`licensed Palos Verdes studio. (Ex. M.) Coreology was also frequently referred to as a
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`“Licensee” in communication with Lagree. (Ex. K1.)
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`4.
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`Coreology is the Alter Ego of Sarah Martz – Fair Isaac Corp.
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`Coreology cites to Fair Isaac Corp. in support of its position that licensee estoppel
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`doesn’t apply to Coreology. However, Fair Isaac Corp. is not applicable here because Sarah
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`Martz is Coreology, and Coreology is Sarah Martz. Fair Isaac Corp. expressly states that “[i]f a
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`licensor can produce sufficient evidence that an agent is an alter ego of the licensee, the agent
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`may also be estopped from challenging a trademark under the doctrine of licensee estoppel.”
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`Fair Isaac Corp. v. Experian Information Solutions, Inc., 650 F.3d 1139, 1150 (8th Cir. 2011).
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`In addition to the evidence already identified herein, Ms. Martz is the sole shareholder of
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`Coreology, Inc. (Ex. J.) Further, Ms. Martz and Lagree have both used the Coreology email
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`address (sarah@coreologyfitness.com) for almost all communications relating to the license
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`relationship between Lagree and Coreology. (Exs. K1, K2, K3, K4, L1, L2.)
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`At least one commercial lease for Coreology identifies “Laura Martz and Sarah Martz
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`d.b.a. Coreology” where Laura Martz is believed to be Sarah Martz’s mother. (Ex. H; See also
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`Ex. I involving a commercial lease where the Tenant is identified as “Sarah Martz and Robert
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`Wolfenden, doing business as dba: Coreology 2.0 LLC” where Mr. Wolfenden is Ms. Martz’s
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`husband.) (emphasis added.) Even in paragraph 6 of her declaration, Ms. Martz states “my
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`studio” when referring to Coreology’s Palos Verdes studio which was opened, owned and
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`operated by Coreology. (Coreology’s Ex. A, S. Martz Decl. at ¶1.)
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`In addition, discovery is still ongoing. Lagree intends to propound additional discovery
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`and obtain additional evidence to prove at trial that Coreology, Inc. is the alter ego of Sarah
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`Martz. For example, Lagree expects to obtain further evidence that Ms. Martz never personally
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`“opened”, “owns” and “operates” a studio, but only did so through her alter ego Coreology.
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`Lagree also expects to obtain evidence showing that Martz and/or Coreology together paid
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`thousands of dollars for Coreology to have the benefits of the trademark license with Lagree.
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`D.
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`Lagree Has Pled “Implied” License for Each of the Marks in Each Opposition.
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`Coreology finally argues that Lagree has not properly pled “implied” license under the
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`alleged marks. (Coreology Resp., p. 10.) Regarding identifying each specific mark in each
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`specific pleading, Lagree has addressed this in Section B above.
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`Coreology mistakenly believes that a written agreement between two parties is
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`required. (Coreology Resp., pp. 2, 4, 5, 9). However, it is well-established that a written license
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`agreement between two parties is not required such as where an oral license is granted or based
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`on the conduct of the parties.5
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`Coreology appears to argue that the proposed affirmative defense does not put them on
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`notice of its basis due to the failure to expressly mention that the license may have been implied
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`in addition to express. (Coreology’s Opp., pp. 10-11). But Coreology does not point to any
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`authority that requires Lagree to specify whether Coreology’s license is implied or express at the
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`pleading stage. Moreover, Coreology has already shown that they are on notice the license could
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`be either express or implied by extensively arguing against it based on a cherry-picked selection
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`of self-serving documents. Id.
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`Coreology argues that because none of the documents expressly identify each of the
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`trademarks at issue that somehow an implied license cannot exist. (Coreology Resp., p. 11.)
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`However, there is no such requirement for an implied license because an implied license is based
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`
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`5 See Great Treats, Inc. v. Bigger Than Bill, Inc. d/b/a Mullen’s Dairy, Opp. No. 91231322,
`2017 WL 4945262 (TTAB Oct. 27, 2017); CB Specialists, Inc. v. Central Avenue Deli, LLC
`d/b/a Lucky Dill Deli, Opp. No. 91212366, 2016 WL 6136604 (TTAB Sept. 26, 2016); Pandora
`Jewelers v. Pandora Jewelry, LLC, 2011 WL 2147012, at *6 (S.D. Fla. June 2, 2011); Go
`Medical Industries Pty, LTD. V. Inmed Corporation, 300 F.Supp.2d 1297, 1313-14 (N.D. Ga.
`2003).
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`on the circumstances surrounding the agreement and the conduct of the parties. Go Medical
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`Industries Pty, LTD. V. Inmed Corporation, 300 F.Supp.2d 1297, 1313-14 (N.D. Ga. 2003).
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`Coreology incorrectly states that “[f]rom 2010 until this opposition, SPX Fitness and
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`Lagree never did anything or said anything to suggest that any of the alleged marks might be
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`considered trademarks or service marks.” (Coreology Resp., p. 11.) However, in addition to the
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`other evidence identified herein, Lagree notified Coreology in April 2017 that “unauthorized
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`usage of Lagree trademarks”, including SCRAMBLED EGGS and SPIDER LUNGE, were
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`found at Coreology’s unlicensed Manhattan Beach studio. (Coreology Resp., Ex. A7.)
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`Coreology disingenuously argues in these proceedings that Lagree’s April 2017 letter
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`was about Coreology’s licensed Palos Verdes studio (Coreology Resp., pp. 6, 11, 12.), but at the
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`time of the letter Coreology clearly understood Lagree was addressing only the unlicensed
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`Manhattan Beach studio and not the licensed Palos Verdes studio. (Ex. G3, p. 3.)
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`Coreology also incorrectly states that Lagree never “exercised any level of quality control
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`over Coreology’s use of the alleged marks at issue.” (Coreology Resp., p. 11.) In May 2013,
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`Lagree notified Coreology that “utilizing the licensor’s intellectual property [is] prohibited and
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`outside the context of your Agreement and [is] deemed to be a breach of your agreement and a
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`violation of intellectual property rights.” (Ex. K1.) In May 2016, Lagree sent Coreology a copy
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`of the Lagree Fitness Certification Terms and Conditions (“Lagree Terms and Conditions”)
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`which specifically addresses ownership and usage of Lagree’s trademarks extensively. (Exs. K2,
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`pp. 3-5, K3, pp. 3-5.) Ms. Martz also requested training by Lagree pursuant to the Certification
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`Terms and Conditions for Coreology’s trainers and herself. (Exs. K4, K5.)
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`Finally, discovery is on-going between the parties. In addition to the evidence already
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`identified herein, Lagree expects to propound further discovery and to obtain additional evidence
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`establishing Coreology’s licensee status with respect to the marks at issue, both expressly and
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`impliedly.
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`E.
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`Lagree Agrees That Extending Discovery for 60 Additional Days Is Needed.
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`Coreology requests extending the discovery period by 60 days – Lagree agrees. Lagree
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`has experienced significant problems with getting Coreology to voluntarily produce documents
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`to help in Lagree’s defense, including documents relating to its licensee estoppel defense.
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`Lagree thus anticipates potential issues obtaining alter ego discovery it will propound to
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`Coreology and Ms. Martz. Lagree therefore is agreeable to extending the discovery period for an
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`additional 60 days as requested by Coreology. If Coreology continues to not cooperate in
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`discovery, Lagree may request that discovery be extended further to avoid prejudicing Lagree
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`with its defenses.
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`F.
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`Conclusion.
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`Lagree respectfully requests that the Board grant its Motion for Leave to Amend its
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`Answers in the consolidated cases as shown in Exhibits A-F.
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` Date: October 30, 2018
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`
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`Respectfully submitted,
`
`
`
` /Michael S. Neustel/
`Michael S. Neustel (Reg. No. 41,221)
`Chad E. Ziegler (Reg. No. 44,273)
`Jason L. Gilbert (Reg. No. 63,621)
`NEUSTEL LAW OFFICES, LTD
`2534 South University Drive, Suite 4
`Fargo, North Dakota 58103
`Telephone: (701) 281-8822
`ATTORNEYS FOR APPLICANT
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`CERTIFICATE OF SERVICE
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`I hereby certify that a copy of the foregoing LAGREE’S REPLY BRIEF IN
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`SUPPORT OF MOTION FOR LEAVE TO AMEND ITS ANSWERS was served upon
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`Opposer’s counsel via electronic mail at the following address:
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`Henry Pogorzelski - tmhou@conleyrose.com
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`
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`DATED this 30th day of October, 2018.
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`Respectfully submitted,
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`
`
` /Jason L. Gilbert/
`Jason L. Gilbert (Reg. No. 63,621)
`
`NEUSTEL LAW OFFICES, LTD
`2534 South University Drive, Suite 4
`Fargo, North Dakota 58103
`Telephone: (701) 281-8822
`Facsimile: (701) 237-0544
`Email: jason@neustel.com
`
`ATTORNEY FOR APPLICANT
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`EXHIBIT G1
`Coreology’s Response in Opposition to Lagree’s Motion to Quash
`Subpoena Suces Tecum to Epiq Systems, Inc.
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`Case 3:18-mc-00678-SI Document 6 Filed 08/27/18 Page 1 of 13
`
`Josephine Ko, OSB No. 132382
`josephine@kolawgroup.com
`LAW OFFICE OF JOSEPHINE KO
`7410 SW Oleson Road, Suite 370
`Portland, OR 97203
`Telephone: (971) 260-0070
`Attorney for Non-Movant/
`Opposer Coreology, Inc.
`
`
`
`UNITED STATES DISTRICT COURT
`DISTRICT OF OREGON
`PORTLAND DIVISION
`
`§
`Case No. 3:18-mc-00678-SI
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`
`
`
`§
`
`
`COREOLOGY, INC.
`§ COREOLOGY’S RESPONSE IN OPPOSITION
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`
`
`
`
`TO LAGREE’S MOTION TO QUASH
`§
`
` Non-Movant/Opposer,
`§
`SUBPOENA DUCES TECUM TO
`
`
`
`
`
`§
`EPIQ SYSTEMS, INC.
`
`
`
`v.
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`§
`
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`
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`LAGREE TECHNOLOGIES, INC. §
`Underlying Trademark Opposition Proceedings
`
`
`
`
`
`§
`Pending in the US Patent and Trademark Office
` Movant/Trademark Applicant
`§
`Before the Trademark Trial and Appeal Board
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`
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`
`
`§
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`
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`§
`Consolidated Case Nos.
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`§
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`§
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`
`
`91236668 (Parent)
`91236942
`91238139
`
`Non-Movant/Opposer Coreology, Inc. (“Coreology”) respectfully submits this response
`
`in opposition to the Motion and Memorandum to Quash Subpoena Duces Tecum to Epiq
`
`Systems, Inc. (Dkt. No. 1) (“Lagree’s Motion to Quash”) filed by Movant/Trademark Applicant
`
`Lagree Technologies, Inc. (“Lagree”).1
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`
`
`
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`1
`
` Lagree’s Motion to Quash relates to three consolidated trademark opposition proceedings
`currently pending before the United States Trademark Trial and Appeal Board, Coreology, Inc.
`v. Lagree Technologies, Inc., Opp. Nos. 91236668 (Parent), 91236942 & 91238139. In the
`underlying trademark opposition proceedings, Lagree has applied to register three purported
`trademarks (i.e., Lagree is the Trademark Applicant), and Coreology is opposing those trademark
`applications (i.e., Coreology is the Opposer).
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`Page 1 - Coreology’s Opposition to Lagree’s Motion to Quash Subpoena to Epiq
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`Case 3:18-mc-00678-SI Document 6 Filed 08/27/18 Page 2 of 13
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`Lagree’s Motion to Quash should be denied. Each of Lagree’s stated basis for quashing
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`SUMMARY OF OPPOSITION
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`Coreology’s Subpoena Duces Tecum lacks merit.
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`First, there is good reason for Coreology to seek discovery from third-party ESI vendor
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`Epiq Systems, Inc. (“Epiq”). It appears that Epiq may possess the ESI in question in a format
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`that would make the identification and production of responsive documents more convenient and
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`less burdensome via Epiq than via Lagree through its own unprocessed data at its ESI vendor,
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`TransPerfect. Moreover, Epiq presently processes certain computer hardware provided by Mr.
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`Ronald A. Shafii (“Shafii”) that Lagree does not have. Contrary to the “stolen” label that Lagree
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`has applied to the ESI that Mr. Shafii provided to Epiq, there is good reason to believe that Mr.
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`Shafii was lawfully in possession of the ESI at all relevant times.
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`Second, discovery of ESI is not nearly so limited as Lagree argues. This is especially the
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`case where, as here, there is good reason to believe that Lagree may not have retained some or all
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`key responsive documents dated prior to the year 2015.
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`Third, the Subpoena imposes no undue burden on Lagree. The Subpoena is directed not
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`to Lagree, but to third party Epiq. Epiq is a large, well-known ESI vendor that is capable to
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`making its own objections regarding the burden of production. Lagree’s objection based on
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`confidentiality is addressed by the standard protective order that is in place by default in all
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`trademark opposition proceedings. Lagree’s objection based on privilege may be easily
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`addressed by a discovery protocol whereby Epiq would first produce responsive documents to
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`Lagree for privilege review.
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`Fourth, many of the documents sought are believed to be otherwise unavailable to
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`Lagree. The parties have not agreed that Lagree may only produce “representative documents,”
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`especially with regard to certain key categories. So far, Lagree has not produced the key
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`Page 2 - Coreology’s Opposition to Lagree’s Motion to Quash Subpoena to Epiq
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`Case 3:18-mc-00678-SI Document 6 Filed 08/27/18 Page 3 of 13
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`documents that Coreology seeks, and it may be that Lagree will be unable to do so without
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`searching the subject ESI that Mr. Shafii provided to Epiq.
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`Denying Lagree’s Motion to Quash will also allow the parties to work together towards
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`an appropriate protocol to identify and produce responsive documents. Prior to the filing of
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`Lagree’s Motion to Quash, Coreology and Epiq had begun discussions to that effect. However,
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`those discussions ceased after the filing of Lagree’s motion.
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`Finally, Lagree’s Motion to Quash should be denied because the 16-page motion exceeds
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`the ten-page limit for discovery motions proscribed in Local Rules 10-6 and 26-3(b)(3).
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`This opposition
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`is supported by
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`the declarations of Ronald A. Shafii and
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`Henry Pogorzelski, including the attachments thereto.
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`BACKGROUND
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`This matter comes before the District Court as a result of Lagree’s improper and
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`premature attempts to prevent Coreology from obtaining key relevant pre-2015 evidence in
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`support of its opposition to Lagree’s trademark applications.
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`A. The Parties and the Underlying Dispute
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`Lagree Fitness, Inc., and related companies (such as Movant Lagree Technologies, Inc.)
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`are owned and operated by an individual named Sebastien Lagree. Mr. Lagree promotes himself
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`and certain Lagree-branded high intensity interval Pilates machines and programs. See
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`generally, Mr. Lagree’s personal website at http://www.sebastienlagree.com. Mr. Lagree and his
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`companies are believed to own and operate only one or perhaps two exercise studios. However,
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`Lagree “licenses” its name and other unspecified rights to potentially hundreds of exercise
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`studios worldwide. See https://www.lagreefitness.com/usa-locator (“Lagree Fitness is available
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`at over 300 locations worldwide!”). Lagree’s first two licensees are known to have contracted
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`with Lagree in 2006. See Pogorzelski Decl., Ex. A.
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`Page 3 - Coreology’s Opposition to Lagree’s Motion to Quash Subpoena to Epiq
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`Case 3:18-mc-00678-SI Document 6 Filed 08/27/18 Page 4 of 13
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`Coreology, Inc., owns an exercise studio in the Los Angeles area, and Coreology is a
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`former licensee/affiliate of Lagree Fitness. Shortly after the relationship between Coreology and
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`Lagree soured around March of 2016, Lagree’s counsel began to accuse Coreology of violating
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`various Lagree intellectual property rights, including certain purported common law trademark
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`rights. Lagree presently claims common law trademark rights to a number of terms, including
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`“wheelbarrow,” “spider lunge,” and “scrambled eggs.” To bolster its purported trademark rights,
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`Lagree filed trademark applications at the United States Patent and Trademark Office to cover
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`these three alleged trademarks. See Ex. B - D (applications). In each of these applications,
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`Lagree has claimed a first use date at least as early as March 15, 2002. Id.
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`Coreology has formally opposed these applications on a number of grounds, including
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`that (1) the three terms do not function as trademarks, but are in reality descriptive and the names
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`of non-trademarkable exercise moves; (2) any rights that Lagree may have had to these names
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`have been lost because Lagree has failed to police the use of these marks, including by engaging
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`in naked licensing. See Ex. E, at ¶¶ 6-8, 12, 16; Ex. F, at ¶¶ 6-8, 12, 17; and Ex. G, at ¶¶ 6, 12,
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`16 (Coreology’s Opposition Pleadings).
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`B. Key Documents Sought.
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`To support its opposition to the registration of Lagree’s alleged trademarks, Coreology is
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`presently seeking discovery of three key categories of documents. First, Coreology is seeking
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`Lagree’s exercise manuals, from Lagree’s alleged date of first use in 2002 to the present. Such
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`documents will likely show that even Lagree has since the year 2002 only referred to these three
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`terms as the names of exercise moves. So far, Lagree has only produced two training manuals,
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`one dated 2014 and the other dated 2017. Pogorzelski Decl. ¶ 10.
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`Second, Coreology is seeking all so-called license agreements between Lagree and its
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`licensee studios, from 2006 to the present. Such agreements are expected to show that when
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`Page 4 - Coreology’s Opposition to Lagree’s Motion to Quash Subpoena to Epiq
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`Lagree licenses its name to various exercise studios, Lagree imposes literally no contractual
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`obligations (including no quality controls) upon any of its licenses with regard Lagree’s alleged
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`“wheelbarrow,” “spider lunge,” and “scrambled eggs” trademarks.2 It is accepted law that
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`trademarks are invalid when the trademark owner issues sufficient naked license. See, e.g.,
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`FreecycleSunnyvale v. Freecycle Network, 626 F3d 509, 515-16 (9th Cir 2010) (reiterating that
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`naked licensing is “inherently deceptive and constitutes abandonment of any rights to the
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`trademark by the licensor.”). Lagree has agreed to only produce “representative documents,”
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`yet, even so, has not produced any such agreements. Pogorzelski Decl. ¶ 10.
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`Third, Coreology is seeking all settlement agreements and/or legal judgments between
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`Lagree and its former licensee studios, from 2006 to the present. Lagree is known to have been
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`involved in multiple legal disputes with its former licensees. This would include a dispute
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`from 2007 with former licensee Mylene Pilutik, as well as other pre-2015 settlements and/or
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`judgments. See Ex. H (summary of claim by Mylene Pilutik ). To the extent that Lagree settled
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`with any of its former licensees without any requirements that those former licensees respect
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`Lagree’s alleged trademark rights, the underlying settlement agreements would provide strong
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`evidence against the validity of the subject Lagree trademark applications. In the underlying
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`oppositions, Lagree has refused to provide any settlement agreements and/or legal judgments.
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`C. Mr. Shafii Does Not Appear to Have Stolen Data from Lagree.
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`Lagree’s Motion to Quash repeatedly emphasizes Lagree’s view that Mr. Shafii has acted
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`in some nefarious manner, citing to the allegations in Lagree’s unsigned and unverified
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`California state court case filed against Lagree. Lagree’s Motion goes so far as to label the ESI
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`in questio