Ossur hf v. Manamed Inc.
Ossur hf v. Manamed Inc.
Opinion of the Court
Plaintiffs Ossur hf and Ossur Americas Inc. (collectively, "Ossur"), moved for a preliminary injunction. Mot., Docket No. 11-1. Defendants Manamed Inc. ("Manamed"), Spartamed LLC ("Spartamed"), John Lasso ("Lasso"), Trevor Theriot ("Theriot"), and Joseph Horton ("Horton") (collectively, "Defendants") opposed. Opp'n, Docket No. 16. Ossur replied. Reply, Docket No. 18.
For the following reasons, the Court grants the motion.
BACKGROUND
I. Request for Judicial Notice
A court may take judicial notice of facts that are readily determinable from accurate sources. Fed. R. Evid. 201(b)(2). Judicial notice is appropriate for (1) documents reflecting official acts of the executive or legislative branches of the United States government, (2) county land records, (3) and proceedings in other courts if those proceedings have a direct relation to the matter at issue.
*1010U.S.exrel.RobinsonRancheriaCitizensCouncilv.Borneo,Inc.,
Here, Ossur requests judicial notice of exhibits 1-12. Docket No. 50-2 ("RJN"). All of these documents fall into appropriate categories for judicial notice. Therefore, the Court grants the request.
II. Factual Background
Ossur develops, manufactures, and distributes orthopedic medical equipment, including knee braces. Fernandez Decl. ¶ 3. Ossur offers several knee braces under the trademark "Unloader."
Ossur's Unloader braces treat patients suffering from osteoarthritis.
Manamed allegedly launched a knee brace-called the "Offloader One"-in direct competition with Ossur's Unloader One. Fernandez Decl. ¶ 12; Compl. ¶ 29. According to Ossur, this brace is ineffective and may aggravate knee pain. Romo Decl. ¶¶ 7-13. Furthermore, when Ossur's investigator called and requested an Unloader One from Manamed, Defendant Horton actually sold the investigator an Offloader One brace without comment. Dailey Decl. ¶¶ 5-11.
Ossur sued Defendants for trademark infringement of the various Unloader marks and unfair competition. See generally Compl. Ossur now seeks to enjoin Defendants from using the "Offloader One" mark while this action is pending. Mot.
LEGAL STANDARD
On an application for a preliminary injunction, the plaintiff has the burden to establish that (1) the plaintiff is likely to succeed on the merits, (2) the plaintiff is likely to suffer irreparable harm if the preliminary relief is not granted, (3) the balance of equities favors the plaintiff, and (4) the injunction is in the public interest. Winterv.NaturalRes.Def.Council,Inc.,
In the Ninth Circuit, courts may evaluate the Winter factors on a sliding scale: "serious questions going to the merits, and a balance of hardships that tips sharply toward the plaintiff can support issuance of a preliminary injunction, so long as the plaintiff also shows that there is a likelihood of irreparable injury and that the injunction is in the public interest." AlliancefortheWildRockiesv.Cottrell,
*1011ANALYSIS
I. Evidentiary Objections
Ossur objects to the declaration of Trevor Theriot. Reply at 7. Ossur argues that Theriot's declaration and attached exhibits constitute hearsay and improper expert testimony. The Court overrules the hearsay objections because a court may consider hearsay at the preliminary injunction stage. Johnsonv.Couturier,
II. Likelihood of Success on the Merits
To show trademark infringement under the Lanham Act, the plaintiff must show that (1) the plaintiff owns a valid trademark; (2) the defendant is using the plaintiff's trademark without the plaintiff's authorization; and (3) the defendant's use of the trademark likely confuses consumers. AppliedInfo.Scis.Corp.v.eBay,Inc.,
A. Validity
Here, the parties primarily dispute whether Ossur's trademark is valid. Neither party disputes that Defendants' use of the mark is unauthorized. And at the hearing, Defendants' conceded that this motion turns on the issue of validity, specifically genericness. Ossur argues that the Unloader marks are valid because they have been in use since 1990 and Ossur owns five registered trademarks. Mot. at 8 (citing Fernandez Decl. ¶ 4; RJN ¶¶ 1-13, Exs. 1-11). Defendants argue that the marks are invalid because they are generic. Opp'n at 1-7. They argue that "unloader" is a general type of knee brace; therefore, Unloader One is not a valid mark.
Generic terms refer to " 'the genus of which the particular product or service is a species,' i.e. , the name of the product or service itself." Advertise.com,Inc.v.AOLAdvert.,Inc.,
The test for genericness is "whether consumers understand the word to refer only to a particular producer's goods or whether the consumer understands the word to refer to the goods themselves."
For instance, Advertise.com held that "advertising.com" was generic because it only conveyed the type of services offered.
*1012
Likewise, GeneseeBrewingCo., Inc.v.StrohBrewingCo., affirmed the denial of a preliminary injunction because it found the phrase "Honey Brown" generic as applied to ales.
In contrast, CaliforniaCooler,Inc.v.LorettoWinery,Ltd., affirmed an injunction against the use of " 'California Special Cooler' or any other name confusingly similar to ' California Cooler.' "
Genericness is a factual issue on which (for registered trademarks) the defendant bears the burden. Advertise.com,
(1) generic use by competitors of the mark that has not been contested by the owner of the mark; (2) generic use of the trademark by the proponent of the trademark; (3) dictionary definitions to determine public usage; (4) generic usage in the media of the trademark, such as in trade journals and newspapers; (5) testimony of persons in the trade; and (6) consumer surveys.
CalistaEnterprisesLtd.v.TenzaTradingLtd.,
Here, Defendants argue that Ossur uses Unloader as a genus of knee braces and not as a source identifier. Opp'n at 5. In response, Ossur argues that, even if unloader is a generic term for a category of knee braces, the trademark *1013"Unloader One" as a whole is not. Reply at 3.
Defendants have presented evidence that consumers understand unloader to mean a particular category of knee braces-not Ossur's Unloader line of knee braces specifically. Defendants rely on various medical websites that refer to unloader as one of four types of knee braces, along with "prophylactic," "functional," and "rehabilitative" braces. See, e.g., Theriot Decl. ¶¶ 5-9, Exs. 2-6, 12, 28. According to these websites, an unloader knee brace is "[a] brace that produces a valgus force on the knee to reduce compressive forces on the medial articular surfaces. It is used to treat patients with deformity and pain caused by osteoarthritis of the knee." Theriot Decl. ¶ 32, Ex. 29; see also id. ¶¶ 13-16, Exs. 10-12 (same). In addition, Defendants show that the National Institutes of Health ("NIH") and the Department of Veterans Affairs ("VA") both use unloader to refer to the type of brace. Id. ¶¶ 17, 22-25 Exs. 14 (NIH study discussing whether patients wear unloader braces generally), 16-22 (VA administrative decisions referring to unloader braces generally). For instance, the VA administrative law judges refer to such a brace as "an unloader brace"-without regard to any specific brand. Finally, Defendants also attached medical studies examining the effect of unloader braces, including several models not made by Ossur. Id. Exs. 15, 24, 25-27. These too refer to such a brace generally as "an unloader brace." Id. In total, this evidence shows that consumers, as well as medical and insurance professionals, use unloader to refer to a type of knee brace rather than a specific firm's knee brace. See Advertise.com,
Yet Defendants have not presented any evidence that consumers use Unloader One generically. Defendants' evidence solely concerns the use of unloader to refer to a broad category of knee braces. Although Unloader One may, like "park and fly," appear facially generic, the Court cannot find the term generic without evidence that consumers primarily use the mark to refer to the service it offers (relieving knee pain) and not its source (Ossur). See Park'NFly, 718 F.3d at 330. Defendants have not presented consumer surveys or relevant testimony; nor have they shown that trade journals or other competitors use the mark in a generic sense. Instead, Defendants have only shown that consumers may generically use the term "unloader." Defendants cannot meet their burden without more specific evidence that consumers generically use "Unloader One." See id.
At the hearing, Defendants argued that the Court should not consider the composite mark because its individual components-"unloader" and "one"-are generic. But the Ninth Circuit has repeatedly rejected this argument. For instance, CaliforniaCooler held that "California Cooler" was not generic, even though neither "California" nor "Cooler" could alone qualify as distinctive.
In sum, the Court finds that Defendants have failed to meet their burden to rebut the mark's presumptive validity, and this does not defeat Ossur's prima facie liability showing.
B. Likelihood of Confusion
Courts consider eight factors to determine whether there is a likelihood of *1014confusion: (1) strength of the mark; (2) proximity or relatedness of the goods; (3) similarity of the sight, sound and meaning of the marks; (4) evidence of actual confusion; (5) degree to which the marketing channels converge; (6) types of goods and degree of care consumers are likely to exercise when purchasing them; (7) intent of defendants in selecting the infringing mark; and (8) likelihood that the parties will expand their product lines. AMFInc.v.SleekcraftBoats,
"This eight-factor analysis is pliant, illustrative rather than exhaustive, and best understood as simply providing helpful guideposts." FortuneDynamic,Inc.v.Victoria'sSecretStoresBrandMgmt.,Inc.,
Ossur argues that the relevant factors all show a likelihood of consumer confusion. Mot. at 8. Defendants do not offer any opposition with respect to consumer confusion; instead, they focus solely on the issue of genericness. Opp'n at 2-7. The Court analyzes the relevant Sleekcraft factors.
1. Strength of the Mark
To determine the strength of a mark, courts examine its (1) conceptual strength and (2) commercial strength. GoTo.com,Inc.v.WaltDisneyCo.,
Here, Ossur argues that its mark is both conceptually and commercially strong. Mot. at 8-10.
i. Conceptual Strength
Conceptual strength is a spectrum. See Brookfield,
*1015"Categorizing trademarks is necessarily an imperfect science ... The line between descriptive and suggestive marks is nearly incapable of precise description." To be suggestive, consumers must use their imaginations to understand a mark's significance. FortuneDynamic,
Here, Ossur argues that Unloader One is suggestive because it suggests a product quality (unloading stress on relevant body parts), yet the consumer must use some imagination to conclude that the product is a knee brace. Mot. at 9. The Court disagrees: "unloader" literally describes the product's function-unloading weight. Therefore, it is a descriptive mark and has weak conceptual strength.
ii. Commercial Strength
"Commercial strength is based on 'actual marketplace recognition.' " NetworkAutomation,Inc.v.AdvancedSys.Concepts,Inc.,
Here, Ossur shows that Unloader One is commercially strong. Ossur has offered its Unloader line of knee braces for almost 30 years. Fernandez Decl. ¶¶ 4-5. Furthermore, Ossur advertises its Unloader products, including the Unloader One, through traditional media, trade shows, and social media. Hoover Decl. ¶¶ 3-10. Therefore, the mark's longevity and advertising give it commercial strength. See Brookfield,
Overall, Ossur's commercial activity strengthens its conceptually-weak mark. Therefore, the mark's strength favors Ossur.
2. Proximity or Relatedness of Goods
"Where goods are related or complementary, the danger of consumer confusion is heightened." E.&J.GalloWinery,
Here, this factor strongly favors Ossur because the goods compete in identical markets. Both the "Unloader One" and "Offloader One" are unloader knee braces that treat knee arthritis. See Fernandez Decl. ¶¶ 13, 15.
3. Similarity of Marks
Courts examine "appearance, sound, and meaning" to determine whether marks are similar.
*1016JLBeverage,
Here, this factor strongly favors Ossur because the marks are nearly identical. First, the marks differ by only three letters-"un" versus "off." As a result, they appear very similar. Second, with respect to sound, three out of the four syllables are identical. Third, the words have similar meanings. Multiple online thesauruses lists "off-load" as a synonym of "unload." See unload, Thesaurus.com (July 26, 2017), http://www.thesaurus.com/browse/unload; unload:v.1, Merriam-Webster (July 26, 2017), https://www.merriam-webster.com/thesaurus/unload. Finally, both marks include "one" as their second word.
4. Actual Confusion
Evidence of actual confusion suggests that future confusion is more likely. Sleekcraft,
Here, Ossur presents minimal evidence of actual confusion. Ossur argues that Manamed's sale of an "Offloader One" brace-when Ossur's investigator actually requested an Unloader One-shows actual confusion. See Mot at 11 (citing Dailey Decl. ¶¶ 5-11, Ex. 1). But this goes more toward the Defendants' intent. At the same time, evidence of actual confusion is not necessary-particularly at the preliminary injunction stage. See ABDIns.,
5. Marketing Channels and Types of Goods
"Convergent marketing channels increase the likelihood of confusion." Sleekcraft,
Here, the types of goods overlap because they are both knee braces. Furthermore, given the goods' identical function, both parties will likely sell their braces through similar marketing channels. Therefore, these factors strongly favor Ossur.
6. Intent
If the defendant knowingly adopts an infringing mark to deceive the public, courts presume that such confusion will occur. Sleekcraft, 559 F.2d at 354. But courts do not require evidence of intent to determine that confusion is likely. PomWonderful,
Here this factor strongly favors Ossur because the individual Defendants adopted the "Offloader One" mark shortly after leaving Ossur's employment. Lasso previously served as the president of an Ossur distributor. Fernandez Decl. ¶ 12. Theriot also served as a sales representative for that distributor. Id. ¶ 9. Therefore, they undoubtedly knew of the "Unloader One" mark. Furthermore, Ossur terminated Lasso for breaching his fiduciary duties *1017and forming a competing entity. Id. Therefore, circumstantial evidence strongly suggests that Defendants intended to deceive the public.
In sum, Ossur has shown that a likelihood of confusion exists. Therefore, Ossur meets it burden to show a likelihood of success on the merits.
III. Irreparable Harm
A plaintiff must demonstrate actual irreparable harm to obtain a preliminary injunction in a trademark case. HerbReedEnterprises,LLCv.FloridaEntm'tMgmt.,Inc.,
Here, Ossur faces irreparable harm from the potential loss of control over its business reputation. By borrowing Ossur's mark, Defendants impair Ossur's control over its reputation. See BrooklynBreweryCorp.v.BlackOpsBrewing,Inc.,
Therefore, Ossur meets its burden to demonstrate irreparable harm.
IV. Balance of Equities
Here, the balance of equities favors Ossur. As discussed, Ossur will suffer significant reputational risk from Defendants' activities. In contrast, Defendants' product is relatively new, so they will not suffer as much from having to change its trademark. Furthermore, Defendants "cannot complain of the harm that will befall [them] when properly forced to desist from [their] infringing activities." BrooklynBrewery,
V. Public Interest
For trademarks, the public interest is the "right not to be deceived or confused." BrooklynBrewery, 156 F.Supp. at 1186 (quoting CytoSport,Inc.v.VitalPharm.,Inc.,
As discussed, Ossur has shown that a strong possibility of public confusion exists. Therefore, the public interest favors Ossur.
CONCLUSION
For the foregoing reasons, the Court grants Ossur's motion for a preliminary injunction. After reviewing the merits of the dispute, the Court concludes that a modest bond is appropriate. Fed. R. Civ. P. 65(c). The injunction shall be effective upon the posting of a bond in the amount of $10,000.
Osteoarthritis is a degenerative joint disease. Romo Decl. ¶ 3. Symptoms include joint pain, stiffness, crackles, swelling, tenderness, joint deformity, and limping.
Because the products already compete, the Court does not analyze the likelihood of expansion.
Reference
- Full Case Name
- OSSUR HF v. MANAMED INC.
- Cited By
- 1 case
- Status
- Published