Cole-Parmer Instrument Company LLC v. Professional Laboratories, Inc.

District Court, N.D. California·Decided July 20, 2021·No. 5:20-cv-08493·Unknown

Opinion

NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION

COLE-PARMER INSTRUMENT Case No. 20-CV-08493-LHK COMPANY LLC, Plaintiff, ORDER GRANTING MOTION TO DISMISS WITH LEAVE TO AMEND v. Re: Dkt. No. 9 PROFESSIONAL LABORATORIES, INC., Defendant. Cole-Parmer Instrument Company LLC (“Plaintiff”)1 sues Professional Laboratories, Inc. (“Defendant”) for (1) trademark infringement under 15 U.S.C. § 1114(1); (2) federal unfair competition under 15 U.S.C. § 1125(a); (3) violation of the California Unfair Competition Law (“UCL”), Cal. Bus. & Prof. Code §§ 17200 et seq.; (4) trademark infringement under common law; and (5) unfair competition under California common law. Before the Court is Defendant’s motion to dismiss Plaintiff’s Complaint. ECF No. 9. Having considered the parties’ submissions, the relevant law, and the record in this case, the Court GRANTS Defendant’s motion to dismiss

1 On April 12, 2021, the Court granted the parties’ stipulation to substitute Cole-Parmer Instrument Company LLC in place of Zefon International, Inc. as Plaintiff after Cole-Parmer Instrument Company LLC “acquired certain assets of [Zefon International, Inc.] at issue in this proceeding, including the trademarks ZEFON and AIR-O-CELL.” ECF No. 39. with leave to amend. A. Factual Background Plaintiff is an Illinois limited liability company with its principal place of business in Vernon Hills, Illinois. ECF No. 38, at 2 (“Ex. B”). Zefon International, Inc. (“Zefon”), Plaintiff’s predecessor-in-interest, is a Florida corporation with its principal place of business in Ocala, Florida. Complaint, ECF No. 1, at ¶ 2 (“Compl.”). Defendant is a Florida corporation with its principal place of business in Weston, Florida. Id. ¶ 3. Plaintiff alleges that it is the current owner of two registered trademarks: the ZEFON trademark and the AIR-O-CELL trademark.2 Id. ¶¶ 10–11; ECF No. 39. Zefon was the original owner of the ZEFON and AIR-O-CELL trademarks. Id. ¶¶ 8, 10, 11. Products bearing these trademarks are “used to test indoor air for the presence of dangerous latent environmental toxins such as mold, asbestos, beryllium, lead, and silica.” Id. ¶ 8. Since 1991, Zefon has “manufactured, promoted, and sold air sampling equipment” bearing the ZEFON trademark. Id. ¶ 8. According to Plaintiff, “ZEFON branded air sampling goods are recognized for their reliability and accuracy” by several industry groups and “have also received third party validation from a university-sponsored testing laboratory.” Id. ¶ 9. Among Plaintiff’s air sampling products is a line of AIR-O-CELL mold-testing devices. Id. ¶ 11. AIR-O-CELL devices are single-use “indoor air quality sampling cassettes,” allegedly recognized for their ability to “consistently provide reliable test results.” Id. ¶¶ 11–12, 14. Zefon allegedly “sold its AIR-O-CELL devices directly to end-users since it first began offering the device” and additionally “made bulk private-label sales . . . to testing laboratories, who then resell to end users.” Id. ¶¶ 17–18. Even when selling to testing laboratories, “the devices still prominently included Plaintiff’s AIR-O-CELL trademark on a paper sticker seal covering 2 The ZEFON trademark, United States Trademark Registration No. 2790526, was allegedly registered on December 9, 2013. Compl. ¶ 10. The AIR-O-CELL trademark, United States Trademark Registration No. 2731728, was allegedly registered on July 1, 2003. Id. ¶ 11. the inlet and outlet and its ZEFON trademark etched into the cassette housing and/or on the paper label.” Id. ¶ 19. Plaintiff alleges that “[i]n or around 2010, [Zefon] agreed to make promotional [private- labeled] AIR-O-CELL devices for Defendant.” Id. ¶ 20. From 2010 to 2019, Zefon allegedly “sold Defendant over one-million private-labeled AIR-O-CELL cassettes.” Id. ¶ 21. In 2020, Plaintiff learned that laboratories “were receiving mold tests in the form of ZEFON AIR-O- CELL cassettes and bearing Defendant’s PRO-LAB trademark, but were yielding poor or unreadable results.” Id. ¶ 22. Plaintiff contends that Defendant “reus[ed] discarded ZEFON AIR-O-CELL cassettes” and “replac[ed] the internal collection media with different and inferior components.” Id. Although the reused cassettes allegedly did not bear the AIR-O-CELL trademark, they “[bore] Plaintiff’s ZEFON trademark etched into the cassette housings.” Id. ¶ 23. Plaintiff contends that it “has received complaints from multiple laboratories that have mistaken Defendant’s reused mold test devices as genuine original devices from Plaintiff,” and that Plaintiff “has not consented to Defendant’s reusing ZEFON branded cassettes.” Id. ¶¶ 25, 28. B. Procedural History On December 1, 2020, Zefon filed the instant case against Defendant. Id. The Complaint alleges five causes of action: (1) trademark infringement under 15 U.S.C. § 1114(1); (2) federal unfair competition under 15 U.S.C. § 1125(a); (3) violation of the UCL; (4) trademark infringement under common law; and (5) unfair competition under state common law. Compl. ¶¶ 29–54. On December 29, 2020, Defendant filed a motion to dismiss Plaintiff’s Complaint. ECF No. 9 (“Mot.”). On January 12, 2021, Plaintiff filed an opposition. ECF No. 17 (“Opp’n”). On January 20, 2021, Defendant filed a reply. ECF No. 24 (“Reply”). On April 12, 2021, the Court granted the parties’ stipulation to substitute Cole-Parmer Instrument Company LLC (“Cole-Parmer”) in place of Zefon as Plaintiff in the instant case after Cole-Parmer “acquired certain assets of [Zefon] at issue in this proceeding, including the trademarks ZEFON and AIR-O-CELL.” ECF No. 39. A. Dismissal Pursuant to Federal Rule of Civil Procedure 12(b)(2) In a motion challenging personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2), the plaintiff, as the party seeking to invoke the jurisdiction of the federal court, “bears the burden” of establishing that jurisdiction exists. In re Boon Global Ltd., 923 F.3d 643, 650 (9th Cir. 2019). “Where, as here, the defendant’s motion is based on written materials rather than an evidentiary hearing, ‘the plaintiff need only make a prima facie showing of jurisdictional facts to withstand the motion to dismiss.’” Ranza v. Nike, Inc., 793 F.3d 1059, 1068 (9th Cir. 2015) (quoting CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066, 1073 (9th Cir. 2011). However, this standard “is not toothless,” and the party asserting jurisdiction “cannot simply rest on the bare allegations of its complaint.” In re Boon Global Ltd., 923 F.3d at 650 (quoting Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004)). Thus, the Court may consider declarations and other evidence outside the pleadings to determine whether the Court has personal jurisdiction. See In re Boon Global Ltd., 923 F.3d at 650 (explaining standard). At this stage of the proceeding, “uncontroverted allegations in plaintiff’s complaint must be taken as true, and ‘[c]onflicts between parties over statements contained in affidavits must be resolved in the plaintiff’s favor.’” Id. (quoting Schwarzenegger, 374 F.3d at 800). However, courts “may not assume the truth of allegations in a pleading which are contradicted by affidavit.” Mavrix Photo, Inc. v. Brand Techs., Inc.,

Cole-Parmer Instrument Company LLC v. Professional Laboratories, Inc., (N.D. Cal. 2021).

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