Fragrancenet. Com, Inc. v. Les Parfums, Inc.

672 F. Supp. 2d 328, 2009 U.S. Dist. LEXIS 114263, 2009 WL 4609268
CourtDistrict Court, E.D. New York
DecidedDecember 8, 2009
Docket09-CV-2626 (JFB)(ETB)
StatusPublished
Cited by12 cases

This text of 672 F. Supp. 2d 328 (Fragrancenet. Com, Inc. v. Les Parfums, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fragrancenet. Com, Inc. v. Les Parfums, Inc., 672 F. Supp. 2d 328, 2009 U.S. Dist. LEXIS 114263, 2009 WL 4609268 (E.D.N.Y. 2009).

Opinion

MEMORANDUM AND ORDER

JOSEPH F. BIANCO, District Judge:

Plaintiff FragranceNet.com, Inc. (hereinafter, “plaintiff’ or “FragranceNet”) brings this action against defendants Les Parfums, Inc., Les Perfumes, Inc., UltraFragrances, Inc., Ultra Fragrances, Inc., and UltraFragrances.com (collectively, “defendants”), alleging that defendants’ use of plaintiffs trademarks constitutes *330 trademark infringement, trademark dilution, passing off, and unfair competition in violation of the Lanham Act, 15 U.S.C. § 1114, 1125(a) & 1125(c). Plaintiff also brings pendent state claims, including: common law trademark infringement, state law dilution, injury to business reputation, unfair competition, unfair and deceptive practices, misappropriation, and unjust enrichment.

Presently before the Court is defendants’ motion to dismiss the complaint under Rule 12(b)(6) of the Federal Rules of Civil Procedure. Specifically, defendants contend that plaintiffs registered trademarks—namely, “FRAGRANCENET” and “FRAGRANCENET.COM”—are not protectable as a matter of law under the trademark laws because the marks are generic. For the reasons set forth below, the Court denies defendants’ motion to dismiss. Although the Second Circuit has in rare circumstances (in the context of publication titles) held that the question of whether a trademark is generic could be decided at the motion to dismiss stage, this case is not one of those extraordinary circumstances. The determination of whether “FRAGRANCENET” and “FRAGRANCENET.COM” are generic marks will require a fact-specific inquiry that is inappropriate at the motion to dismiss stage. Plaintiff alleges that its trademarks are registered and, thus, there is a presumption that the mark is not generic. There is absolutely nothing in the pleadings to conclude, as a matter of law, that defendants have overcome this presumption. In short, plaintiff has asserted plausible claims under the trademark laws that survive a motion to dismiss. Moreover, the Court declines to convert the motion to dismiss into a motion for summary judgment because defendants have submitted no evidence outside the pleadings for the Court to consider and, in any event, plaintiff is entitled to conduct discovery before making its presentation of evidence in response to any potential summary judgment motion. Accordingly, the motion is denied in its entirety.

I. Background

A. Facts

The following facts are taken from the complaint (“Compl.”), which the Court assumes to be true for the purposes of deciding this motion. The Court construes the facts in the light most favorable to plaintiff, the non-moving party. See, e.g., Leibowitz v. Cornell Univ., 584 F.3d 487, 492 (2d Cir.2009).

Plaintiff FragranceNet is a Delaware corporation with its principal place of business in Hauppauge, NY. (Compl. ¶ 7.) Since January 1997, plaintiff has owned and operated an online retail store that sells perfume and related products at www.fragrancenet.com. (Compl. ¶¶ 2, 13.) Plaintiffs trademarks, FRAGRANCENET and FRAGRANCENET.COM, are registered, and plaintiff has used those marks in connection with its sale and marketing of perfume and related products online since January 27, 1997. (Compl. ¶¶ 14, 15.) Plaintiff has sold millions of dollars of merchandise through its website, which accepts orders directly from customers. (Compl. ¶ 16.) Over the past twelve years of operation, plaintiff has established a reputation for high-quality retail sales and customer services under its marks. (Compl. ¶ 17.) There is customer recognition of these marks, and the marks have acquired a substantial level of goodwill. (Id.)

The instant action arises out of defendants’ bidding on, purchasing, and using certain keywords, including plaintiffs trademarks, in Google’s AdWords program, with the knowledge that doing so would result in defendants’ links appearing as “Sponsored Links” when a consumer *331 types “fragrancenet,” “fragrancenet.com” or other variations of FragranceNet’s mark into an Internet keyword search on Google. (Compl. ¶ 3.) The AdWords Program by Google allows advertisers to bid on particular keywords that apply to their websites. (Compl. ¶ 19.) Advertisers may specify whether keywords should be applied as a “broad match,” “phrase match,” “exact match,” or “negative match.” When an advertiser bids on a “broad match,” its link will appear when a search is conducted for that keyword, its plural forms, its synonyms, or phrases similar to the word. (Compl. ¶ 20.) When an advertiser bids on a “phrase match,” its link will appear when a user searches for a particular phrase, even if that phrase is used in combination with other words. (Compl. ¶ 21.) An “exact match” will display the advertiser’s link only when the exact phrase bid on is searched on Google. (Compl. ¶ 22.) A “negative match” bid allows an advertiser to ensure that its link does not appear when certain terms are searched. (Compl. ¶ 23.) Sponsored Links appear on the top and right side of the search results screen. (Compl. ¶¶ 18, 25.)

According to plaintiff, defendants bid on certain keywords, including plaintiffs trademarks, to cause their links to appear as “Sponsored Links” on Google when a search for “FRAGRANCENET” or “FRAGRANCENET.COM” is performed. (Compl. ¶¶ 18, 24, Ex. A.) As a result, defendants’ links would appear on the top and right side of the search results screen when a search for plaintiffs trademarks was performed. (Compl. ¶¶ 18, 24, Ex. A.)

Plaintiff alleges that it demanded that defendants discontinue all further use of plaintiffs marks and asked that defendants bid on plaintiffs marks as a “negative match” to prevent defendants’ links from appearing as results when plaintiffs marks are searched on Google. (Compl. ¶ 25.) According to plaintiff, defendants refused to do either and have continued to use plaintiffs trademarks without permission. Plaintiff further alleges that defendants have generated substantial revenue and benefits from this use. (Compl. ¶¶ 4, 26.) Plaintiff claims that this practice has caused confusion among consumers and that plaintiff has suffered irreparable harm as a result of defendants’ use of its trademarks. (Compl. ¶¶ 4, 31.)

B. Procedural History

On June 19, 2009, plaintiff filed the instant complaint against defendants. By letter dated September 3, 2009, defendants indicated their intention to move for dismissal of the complaint for failure to state a cause of action upon which relief can be predicated. On September 30, 2009, defendants filed their motion to dismiss. Plaintiff filed opposition papers on October 30, 2009, and defendants filed their reply on November 6, 2009. Oral argument was heard on December 2, 2009. The Court has fully considered the submissions of the parties.

II. Standard of Review

In reviewing a motion to dismiss pursuant to Federal Rule of Civil Procedure

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672 F. Supp. 2d 328, 2009 U.S. Dist. LEXIS 114263, 2009 WL 4609268, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fragrancenet-com-inc-v-les-parfums-inc-nyed-2009.