1 2 3 4 UNITED STATES DISTRICT COURT 5 DISTRICT OF NEVADA 6 * * *
7 GO NEW YORK TOURS, INC. d/b/a “TEA Case No. 2:25-cv-00279-RFB-EJY AROUND TOWN, et al. 8 ORDER Plaintiff, 9 v. 10 TEA ON THE STRIP, LLC, et al., 11 Defendants. 12
13 Before the Court are the (ECF No. 31) Emergency Motion for Temporary Restraining Order 14 and (ECF No. 32) Emergency Motion for Preliminary Injunction by Plaintiffs Kost, Inc., Go New 15 York Tours, Inc., and Tea Around Town Las Vegas, Inc. For the following reasons, the Court 16 grants the Motion for a Preliminary Injunction in part and denies the Motion for Temporary 17 Restraining Order as moot. 18 I. PROCEDURAL HISTORY 19 On February 11, 2025, Plaintiffs filed their Complaint for Trademark Infringement (15 20 U.S.C. § 1114); Trade Dress Infringement/False Advertising (15 U.S.C. § 1125(a)(1)); Common 21 Law Unfair Competition; and Deceptive Trade Practices. ECF No. 1. On February 26, 2025, 22 Plaintiffs filed emergency Motions for a Temporary Restraining Order (“TRO”) and Preliminary 23 Injunction (“PI”). ECF Nos. 11, 12. The Court ordered Plaintiffs to serve Defendants and for 24 Defendants to file a response by March 4, 2025. ECF No. 13. On February 26, 2025, Defendants 25 accepted service. ECF No. 16. On March 5, 2025, Defendants filed their response to the TRO/PI 26 Motions. ECF No 19. On March 19, 2025, Defendants filed their Answer to the Complaint. ECF 27 No. 23. 28 1 After the Court set the TRO/PI Motions for a hearing on April 10, 2025, ECF No. 25, 2 Plaintiffs filed a declaration of Asen Kostadinov in support of their Motions. ECF No. 28. On April 3 10, 2025, the Court held a hearing on the pending Motions wherein Defendants described their 4 efforts to resolve the dispute without intervention by the Court, including temporarily closing their 5 business, changing their business name from “Tea on the Strip” to “Café on the Strip,” modifying 6 the design of their bus, and modifying their website and social media. ECF No. 30. The Court 7 ordered Defendants to provide Plaintiffs “with all changes or modifications to designs of the bus 8 (inside and out), the website, social media, and any other relevant modifications regarding the 9 instant lawsuit by Saturday, April 12, 2025, at 5:00 p.m.” Id. The Court further ordered a briefing 10 schedule for a renewed PI/TRO, in the event that, after receiving Defendants’ modifications, 11 Plaintiffs sought further Court intervention. 12 Consistent with the Court’s Order, Plaintiffs filed their renewed TRO/PI Motions on April 13 15, 2025. ECF Nos. 31-32. On April 16, 2025, Defendants filed their Opposition, ECF No. 33, and 14 Plaintiffs filed their Reply. ECF No. 34. On April 17, 2025, the Court held a hearing on the 15 renewed Motions. ECF No. 35. At the hearing, the Court granted Plaintiffs’ PI Motion in part on 16 the record, with a separate written ruling to follow. ECF No. 35. The Court’s more detailed ruling 17 is set forth below. 18 II. FACTUAL FINDINGS 19 The Court makes the following findings of fact relevant to the preliminary injunction. 20 The “Tea Around Town” Mark is registered and owned by Plaintiff Kost, Inc., and has 21 been in continuous use by its exclusive licensee, Plaintiff Go New York Tours, Inc., since July 11, 22 2023. Plaintiffs operate “Tea Around Town,” an upscale tea experience abroad a luxury double- 23 decker bus, offering a unique and immersive customer experience. The Tea Around Town trade 24 dress includes distinctive branding, including interior and exterior design of their double decker 25 bus where they serve tea to customers. The design of Plaintiffs’ bus features a predominantly pink 26 color scheme with white and gold, incorporating florals, greenery, and illustrations of people 27 partaking in high tea. The interior of the bus incorporates the pink, gold, and white color scheme 28 including booths and table settings utilizing the same shade of pink, gold accents throughout, 1 souvenir tumblers with pink lids, and decorative pearl and sparkle strips along the ceilings. The 2 staff uniforms also incorporate the same color pink. 3 Tea Around Town spent over two years and millions of dollars researching and developing 4 their trade dress and marketing strategy. Its first bus tours began in New York City in July 2024. 5 Since its inception, it has received significant recognition through extensive marketing, 6 advertising, and word-of-mouth promotion. Tea Around Town operates in six cities and is actively 7 expanding its operations throughout the United States and internationally. Tea Around Town in 8 New York City was in operation for only five months when Beyonce and Jay-Z brought the family 9 for a private tour, which made the company “TikTok-famous.”1 The company’s content has 10 received millions of views on TikTok and achieved national recognition as a unique tea-on-a-tour- 11 bus experience. 12 Plaintiffs’ records indicate, and Defendants do not contest, that between September 18, 13 2023, and March 15, 2024, Defendant Yolanda Drai and her son Defendant Dustin Drai patronized 14 Tea Around Town on multiple occasions. On October 13, 2024, Defendant Dustin Drai formed 15 “Tea on the Strip” in the State of Nevada. Defendants launched their business using the Tea on the 16 Strip mark in or around February 2025. Defendants advertised their “Las Vegas Strip Bus Tour & 17 Tea Experience” in social media posts on profiles under the name Tea on the Strip, displaying their 18 own double decker tea bus which utilized a color scheme of predominantly pink—and a similar 19 shade to Tea on the Town’s pink—white and gold, and other features that were confusingly similar 20 to Tea on the Town’s bus design. In comments on Tea on the Strip’s posts featuring both the 21 exterior and interior design of the bus, multiple people posted comments indicating they believed 22 Tea on the Strip was affiliated with Tea on the Town. 23 On February 14, 2024, Plaintiffs filed articles of incorporation in the State of Nevada, with 24 the Office of the Secretary of State, for the entity Tea Around Town Las Vegas, Inc. 25
26 1 Michael Capetta, Beyoncé and Jay-Z just Took Their Kids on this TikTok-famous NYC Tour Bus, Travel 27 + Leisure (Dec. 22, 2023), https://www.travelandleisure.com/beyonce-and-jay-z-nyc-tiktok-famous-tour-bus- holidays-8419684?utm_source=emailshare&utm_medium=social&utm_campaign=shareurlbuttons. 28 1 A. Plaintiffs’ and Defendants’ Marks 2 At the start of the lawsuit, Defendants used the below mark, set beside Plaintiffs’ mark for 3} comparison: 4 Plaintiffs’ Mark Defendants’ Mark 5 PATEA ec ARQUND Tea onthe Strip 7 TOWN 9 Plaintiffs first contacted Defendants on February 11, 2025, with a demand letter and a copy 10 | of the Complaint they filed that day. The parties and their counsel engaged in settlement 11 | negotiations. Ultimately, Defendants agreed to cease operating their business until the instant 12 | dispute was resolved. They also agreed to change their name to “Café on the Strip” and now utilize 13 | the below mark: 14 se WYETLYCKOXMYE 15 10 Pretrulous 5 . Cafe on the Strip) 16 17 18 B. Defendants’ Internet Presence 19 Defendants changed their social media profiles from “Tea on the Strip” to “Café on the 20 | Strip” but did not deactivate those profiles. At the time of the Court’s hearing on the instant 21 | Motions, the Defendants confirmed that all social media ‘tags’ or digital markers that were 22 | previously associated with “Tea on the Strip” had been deleted so no online traffic was being 23 | redirected. 24 Defendants changed their website URL from teaonthestrip.com to cafeonthestrip.com.’ 25 | Although the website name is changed, Defendants have left the “Tea on the Strip” name in its 26 | lists of keywords, which allows search engines to associate the site with a search for “Tea on the 27 28 2 See archive of https://www.cafeonthestrip.com/ from Thursday 17, April 2025 at https://perma.cc/5D5A- A3ZW.
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1| Strip.” 2 C. Defendants’ Bus Design 3 At the hearing on Plaintiffs’ first PI/TRO Motions, Defendants informed the Court of their efforts to resolve the dispute, including by proposing to Defendants modifications to their bus 5 | design. The Court ordered Plaintiffs to send modifications to their bus design “both interior and 6 | exterior,” by April 12, 2025. Defendants sent Plaintiffs their proposed changes to the exterior of 7 | their bus, pictured below alongside Plaintiffs’ bus design for comparison. They proposed no 8 | changes to the interior design of the bus (also pictured below). 9 sissies coneea a | | ie aeons em a a a = 7 a re a □ SORA — | ty EE ——————————— □ 10 Red ce □□ eeCE ary rr a ‘| =. * =e ll. “4s Sh 12. or. 11 icra | aL ct =) ©) = i □□ eh ak 12 13 = % CX ouniien inti k 2 COR citi STi 1 Eas sag oa jee ae | 14 □ i ple tf i) bags ed = gle □□ , 2s Gea) -_ = ee aa 15 , 16 : Interior 17 ai □□ ————— ie ———— het taken'teom the same angle: 1: Pe ee es ts | ee 2) er ae Both interior uses the same colar scheme: pink, See) esr — OP 14) ee in = pT —_ □ a pg nate 18 H— ee le □ tae rh he [4] Floral garlands around the top of the bus, i i memenaail i Sia | ‘a a [2] Floral patencs at she sides ofthe bus, 19 a = | =e a Lae | | iss a the windows. = peated ea mt (2) iets netesaeramier a. 1 safe tere ioct 20 oi 73 fh LP Se ] it — eas an the door side of the bus. 7 J 4 = Pink and white on booths, 21 iy mee ce ait eee eens _ “ots =o, 23 24 Plaintiffs also presented evidence that the product Defendants have been offering since 25 February are inferior based on the evaluation of their quality control expert who patronized 26 Defendants’ Tea on the Strip bus tour. 27 Il, LEGAL STANDARD 28 The standard for issuing a temporary restraining order is the same as that for issuing a
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1 preliminary injunction. Stuhlbarg Int'l Sales Co. v. John D. Brushy & Co., 240 F.3d 832, 839 n. 7 2 (9th Cir. 2001). A TRO is an “extraordinary remedy that may only be awarded upon a clear 3 showing that the plaintiff is entitled to such relief.” Winter v. Nat. Res. Def. Council, Inc., 550 4 U.S. 7, 22 (2008). 5 A party seeking preliminary injunctive relief must make a “clear showing” that: (1) it is 6 likely to succeed on the merits; (2) it is likely to suffer irreparable harm in the absence of 7 preliminary relief; (3) the balance of equities tips in its favor; and (4) an injunction is in the public 8 interest. Id. at 7, 20, 22. The Ninth Circuit employs a sliding scale approach “under which a 9 preliminary injunction c[an] issue where the likelihood of success is such that serious questions 10 going to the merits were raised and the balance of hardships tips sharply in [the moving party’s] 11 favor,” provided that the moving party also makes a showing of irreparable harm and that an 12 injunction is in the public interest. All. for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1131-32, 13 1135 (9th Cir. 2011) (citation and internal quotation marks omitted) (holding that the “serious 14 questions” approach survives Winter). 15 IV. DISCUSSION 16 a. Likelihood of Success on the Merits 17 The Court considers Plaintiffs’ likelihood of success on the merits of their trademark and 18 trade dress infringement claims. 19 i. Trademark Infringement 20 In order to prevail on a trademark infringement claim, a plaintiff must show that: 1) it is 21 the owner of the asserted marks; and 2) the use of the mark by the alleged infringer is likely to 22 cause confusion or mistake or deceives the consumer. Survivor Media v. Survivor Productions, 23 406 F.3d 625, 630 (9th Cir. 2005). Plaintiff establishes it is the owner of the federally registered 24 trademark and it has extensively advertised its product using this mark. To show there is a 25 likelihood of a consumer confusing Defendants’ mark with Plaintiffs’, the Court considers eight 26 factors, known as the “Sleekcraft” factors, in its determination: (1) The strength of the mark; (2) 27 The similarity of the marks; (3) The relatedness of the goods; (4) The marketing channels used by 28 the companies; (5) The alleged infringer's intent in selecting it mark; (6) Evidence of actual 1 confusion; (7) The likelihood of expansion into other markets, and; (8) The degree of care likely 2 to be exercised by purchasers of the good. GoTo.com, 202 F.3d at 1205. “Some factors are much 3 more important than others, and the relative importance of each individual factor will be case 4 specific.” Brookfield Communications, Inc. v. West Coast Entertainment, Corp., 174 F.3d 1036 5 (9th Cir. 1999). 6 That Plaintiffs are the registered owner of the asserted Mark is undisputed. The Court thus 7 addresses each Sleekcraft factor in turn. 8 1. Strength of the Mark 9 A mark’s strength is evaluated based on two components: “the mark’s inherent 10 distinctiveness (i.e., its conceptual strength)” and “the mark’s recognition in the market (i.e., its 11 commercial strength).” Lahoti v. Vericheck, Inc., 636 F.3d 501, 508 (9th Cir. 2011)). 12 a. Conceptual Strength 13 A mark’s conceptual strength “depends largely on the obviousness of its connection to the 14 good or service to which it refers.” Fortune Dynamic, Inc. v. Victoria's Secret Stores Brand Mgmt., 15 Inc., 618 F.3d 1025, 1032–33 (9th Cir. 2010) (quoting JL Beverage Co., LLC v. Jim Beam Brands 16 Co., 828 F.3d 1098, 1107 (9th Cir. 2016)) To determine a mark’s conceptual strength, the Court 17 must classify a mark along a spectrum of five categories ranging from strongest to weakest: 18 arbitrary, fanciful, suggestive, descriptive, and generic. Id. Arbitrary and fanciful marks, which 19 employ words and phrases with no commonly understood connection to the product, are the two 20 strongest categories, and “trigger the highest degree of trademark protection.” Id. (citations 21 omitted). In the middle of the spectrum are suggestive marks, which suggest a product’s features 22 and require consumers to exercise some imagination to associate the suggestive mark with the 23 product. Id. (citing Fortune Dynamic, 618 F.3d at 1033.) Id. Descriptive and generic marks, at the 24 other end of the spectrum, are the two weakest categories. Id. Descriptive marks define a particular 25 characteristic of the product in a way that does not require any imagination, while generic marks 26 describe the product in its entirety and are not entitled to trademark protection. Id. 27 Here, the Court finds the Mark “Tea Around Town” is suggestive. While it is descriptive 28 in that it describes aspects of the product: the beverage served and the location, it is suggestive in 1 that it does not state “tea on a bus” but rather “tea around town.” It would require a consumer to 2 exercise some imagination to interpret “tea around town” as meaning tea being served on a double 3 decker bus while driving around a city. 4 b. Commercial Strength 5 “After identifying whether a mark is generic, descriptive, suggestive, arbitrary, or fanciful, 6 the court determines the mark’s commercial strength.” JL Beverage, 828 F.3d at 1107 (9th Cir. 7 2016). This is determined by “actual marketplace recognition.” Network Automation, Inc. v. 8 Advanced Sys. Concepts, Inc., 638 F.3d 1137, 1149 (9th Cir. 2011). Advertising expenditures, 9 which increase marketplace recognition, offer evidence of commercial strength and “can transform 10 a suggestive mark into a strong mark.” JL Beverage, 828 F.3d at 1107 (9th Cir. 2016) (citing 11 Network Automation, 638 F.3d at 1149). 12 The Court finds the evidence of Plaintiffs’ significant expenditures on advertising, brand 13 recognition, investment by high profile celebrities like Beyonce and Jay Z, and “Tik-Tok fame,” 14 together with the fact that the tea tour bus model appears to be the first of its kind, together render 15 “Tea on the Town” a strong mark. 16 2. Similarity of Marks 17 In considering the degree of similarity, a court should view the marks in their entirety as 18 they appear in the marketplace. Entrepreneur Media, Inc. v. Smith, 279 F.3d 1135, 1144 (9th Cir. 19 2002). Additionally, a court should consider the similarity in appearance, sound and meaning. Id. 20 Similarities are given more weight than differences. Alpha Industries, Inc. v. Alpha Steel Tube & 21 Shapes, 616 F.2d 440, 440 (9th Cir. 1980) (citing AMF, Inc. v. Sleekcraft Boats, 599 F.2d 348, 22 351 (9th Cir. 1979)). 23 Plaintiffs argue that the name follows the same formula consisting of the term “Tea” 24 combined with a location-based descriptor and contains the same number of syllables. The Court 25 finds this creates a similarity in sound and meaning. Further, the color scheme is the same, and the 26 placement of the mark within a gold frame is the same. While the typeface of the marks and the 27 color of the font are different, and the logos are formatted somewhat differently, the Court finds 28 these differences are outweighed by the similarities and this factor weighs in favor of Plaintiffs. 1 3. Proximity or Relatedness of the Goods 2 “Related goods are those products which would be reasonably thought by the buying public 3 to come from the same source if sold under the same mark.” Entrepreneur Media, Inc., 279 F.3d 4 at 1147 (quoting AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348 n.10 (9th Cir. 1979)). “[T]he 5 more closely related the goods are, the more likely consumers will be confused by similar marks.” 6 Id. The products, which are both experiential tours around a city serving high tea in a bus which 7 emphasizes branding and design of the bus, such that the experience is an aesthetic one, where 8 many consumers take photos while participating to be posted on social media, are clearly related. 9 4. Marketing Channels 10 “Convergent marketing channels increase the likelihood of confusion.” Nutri/System, Inc. 11 v. Con-Stan Industries, 809 F.2d 601, 606 (9th Cir. 1987). This factor does not require the sale of 12 the goods by identical vendors, but rather “the same type of distribution channel.” Century 21 Real 13 Estate Corp. v. Century Life of America, 970 F.2d 874 (Fed. Cir. 1992). 14 The Court notes the importance of social media marketing to both companies. Accordingly, 15 Plaintiffs emphasize their concern that consumers who search “Tea on the Strip,” or see photos of 16 social media influencers with that tag, are directed to Defendants’ renamed profile “Café on the 17 Strip.” Plaintiffs point to Defendants’ social media posts where confused users refer to Tea on the 18 Strip as potentially affiliated with Tea on the Town in New York or other locations. Further, 19 Defendants’ website includes a “Quick Link” for “influencer & media opportunities.”3 The Court 20 therefore finds the parties use converging marketing channels through social media. This factor 21 therefore supports a finding of likelihood of confusion. 22 5. Defendants’ Intent in Selecting the Mark 23 Plaintiffs are not required to demonstrate the infringer “intended to deceive consumers.” 24 E.& J. Gallo Winery v. Gallo Cattle Co., 967 F.2d 1280, 1293 (9th Cir. 1992). Intent to confuse 25 may be inferred when the “alleged infringer chooses a mark he knows to be similar to another.” 26 Entrepreneur Media, 279 F.3d at 1148 (citing Official Airlines Guides, Inc. v. Goss, 6 F.3d 1385 27 28 3 See archive of https://www.cafeonthestrip.com/ from Thursday 17, April 2025 at https://perma.cc/5D5A- A3ZW. 1 (9th Cir. 1993)). Plaintiffs have presented evidence that Defendants repeatedly patronized Tea on 2 the Town shortly before choosing the mark and establishing Tea on the Strip, and Defendants have 3 not contested that evidence. In fact, Defendants have not produced admissible evidence contesting 4 Plaintiffs’ allegations that they did so with the intent of copying Plaintiffs’ intellectual property. 5 The Court finds they were at a minimum, aware of Plaintiffs’ product when selecting their mark, 6 and notes that a reasonable factfinder could infer from the evidence currently before the Court that 7 Defendants chose Tea on the Strip’s trademark and trade dress with the intent of deceiving 8 customers. This factor weighs heavily in favor of Plaintiffs. 9 6. Evidence of Actual Confusion 10 Plaintiffs have presented evidence of actual confusion with people commenting on social 11 media that they believe Tea on the Strip is related to Plaintiffs’ company. This favor weighs heavily 12 in favor of Plaintiffs. 13 7. Likelihood of Expansion 14 Plaintiffs have incorporated in Las Vegas. They have already expanded to six other cities 15 and are investing significant resources expanding into other cities both nationally and 16 internationally. This factor also weighs heavily in favor of a likelihood of consumer confusion. 17 8. The Degree of Care Likely to Be Exercised by Purchasers 18 The likelihood of confusion is determined by the “reasonably prudent consumer.” 19 Brookfield Commc'ns, 174 F.3d 1036, 1060 (9th Cir. 1999) (citing Dreamwerks Production 20 Group, Inc., 142 F.3d 1127, 1129 (9th Cir. 1998); Sleekcraft, 599 F.2d at 353. A “reasonably 21 prudent consumer” is expected to be “more discerning and less easily-confused” when purchasing 22 expensive items, and when the products being sold are marketed primarily to expert buyers, and 23 less discerning and more easily confused when purchasing inexpensive items. Id. The parties’ 24 respective tea bus tour products cost approximately $100. While that amount may be relatively 25 costly, this is not a product marketed to expert buyers, and it is a relatively new concept marketed 26 to unsophisticated consumers who are unlikely to have extensive experience with the product. 27 Therefore, the Court finds this factor tips slightly in favor of Plaintiffs. 28 9. Conclusion 1 “Only a subset of the Sleekcraft factors are needed to reach a conclusion as to whether 2 there is a likelihood of confusion.” GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1206 (9th 3 Cir. 2000). Based upon the analysis of the Sleekcraft factors, the Court finds Plaintiffs have 4 demonstrated a likelihood of confusion, and therefore finds that Plaintiffs have demonstrated a 5 likelihood of success as to its trademark infringement claim. 6 ii. Trade Dress 7 Trade dress involves “the total image of a product and may include features such as size, 8 shape, color or color combination, texture, graphics, or even particular sales techniques.” Mattel, 9 Inc. v. Walking Mountain Prods., 353 F.3d 792, 808 n. 13 (9th Cir. 2003) (quoting Two Pesos, 10 Inc. v. Taco Cabana, Inc., 505 U.S. 763, 765 n. 1 (1992)). To sustain a claim for trade dress 11 infringement, Plaintiffs must prove: (1) that its claimed dress is nonfunctional; (2) that its claimed 12 dress serves a source-identifying role either because it is inherently distinctive or has acquired 13 secondary meaning; and (3) that the defendant’s product or service creates a likelihood of 14 consumer confusion. Clicks Billiards, Inc. v. Sixshooters, Inc., 251 F.3d 1252, 1258 (9th Cir. 15 2001). To determine whether a plaintiff is entitled to injunctive relief regarding its trade dress 16 claim, the central inquiry is whether the defendant’s use of the asserted dress is likely to cause 17 consumer confusion. See Brookfield Commc'ns, 174 F.3d at 1053 (quoting Official Airline 18 Guides, Inc. v. Goss, 6 F.3d 1385, 1391 (9th Cir.1993) (characterizing the likelihood of confusion 19 inquiry as “[t]he core element of trademark infringement”). 20 The Court considers the elements of trade dress infringement and the likelihood of 21 confusion in turn. 22 1. Functionality 23 The “test for functionality proceeds in two steps.” Au-Tomotive Gold, Inc. v. Volkswagen 24 of Am., Inc., 457 F.3d 1062, 1072 (9th Cir. 2006). First, a court must evaluate a claimed trademark 25 for utilitarian functionality. Id. If the mark lacks utilitarian functionality, the court must then 26 proceed to the second step of the test to evaluate it for aesthetic functionality. Id. If the mark has 27 either utilitarian or aesthetic functionality, it is ineligible for protection under trademark law. See 28 id. 1 Where a trademark consists of a color scheme, the colors have utilitarian functionality only 2 if the claimed colors are superior to alternative colors in performing the function that they were 3 designed to perform. Zest Anchors, LLC v. Geryon Ventures, LLC, No. 22-55704, 2023 WL 4 2783175 (9th Cir. Apr. 5, 2023) (citing Moldex-Metric, Inc. v. McKeon Prods., Inc., 891 F.3d 878, 5 887 (9th Cir. 2018) (explaining that a claimed color selected for its visibility may lack utilitarian 6 functionality where alternative colors are “equally or more visible”); Qualitex Co. v. Jacobson 7 Prods. Co., 514 U.S. 159, 166 (1995) (explaining that a claimed color for a dry-cleaning press pad 8 serves no utilitarian function where other colors are equally useful in performing the function of 9 preventing stains). Plaintiffs’ color scheme here serves no utilitarian functionality. 10 The test for aesthetic functionality is “whether protection of the feature as a trademark 11 would impose a significant non-reputation-related competitive disadvantage.” Au–Tomotive Gold, 12 Inc. v. Volkswagen of America, Inc., 457 F.3d 1062, 1972 (9th Cir. 2006). The Court finds that 13 Defendants have not established that they would be placed at a significant non-reputation-related 14 competitive disadvantage if they were denied the right to use Plaintiffs’ particular shade of pink 15 combined with white and gold, or any of the other interior and exterior bus designs Defendants 16 presented to the Court, which the Court finds are likely to be infringing. At the hearing on the 17 instant motions, Defendants claimed they would be at a disadvantage because pink is the 18 quintessential “feminine color,” and they seek to market their product to women. The Court does 19 not find that unsupported assertion persuasive. Moreover, this Court does not enjoin Defendants 20 from using the color pink—the order is limited to the use of the particular shade of pink which 21 predominates Plaintiffs’ trade dress, combined with white and gold, as utilized by Defendants in 22 the current bus designs before the Court. Defendants’ only other claim of disadvantage is that it 23 will be costly to change the bus design, i.e., by having to reupholster their pink seats in the interior. 24 This is not the kind of disadvantage that shows aesthetic functionality. 25 Therefore, the Court finds Plaintiffs’ claimed trade dress is nonfunctional. 26 2. Distinctiveness/Secondary Meaning 27 In assessing distinctiveness, courts employ a five-part continuum of increasing inherent 28 distinctiveness. A trademark or trade dress may be (1) generic, (2) descriptive, (3) suggestive, (4) 1 arbitrary, or (5) fanciful. Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 9 (2d Cir. 2 1976); see also GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1207 (9th Cir. 2000). Marks 3 and dresses falling into the latter three categories are entitled to protection without a showing of 4 secondary meaning. Two Pesos, 505 U.S. at 768. While trademarks are rights in gross regarding a 5 particular image, trade dress protects only the general appearance of a particular product or service. 6 Nova Wines, Inc. v. Adler Fels Winery LLC, 467 F. Supp. 2d 965, 977 (N.D. Cal. 2006). 7 The Court finds that Tea on the Town’s claimed trade dress is likely protectable. Plaintiffs’ 8 claimed trade dress consists of a double-decker bus with a predominantly pink exterior with white 9 and gold, elements of greenery and flowers, and illustrations of people enjoying high tea; a bus 10 interior that is predominantly pink with white and gold accents, including the pink booth color and 11 design, pink table settings, decorative gold vent covers, gold seat number plaques; floral garlands 12 lining the bus ceilings and pearl strips on the ceiling; uniforms incorporating the same shade of 13 pink which predominates in all of Plaintiffs’ branding and design; and pink souvenir tumblers with 14 a pink lid, again utilizing the same shade of pink that predominates in the Tea on the Town color 15 scheme. 16 For the same reasons the Court found Plaintiffs’ mark to be suggestive, it finds the Tea on 17 the Town trade dress is suggestive. The Court further finds Plaintiffs’ unique aesthetic bus design 18 has created a recognizable trade dress specifically related to its product of serving high tea on a 19 bus. The consistent and repeated use of the predominant pink with white and gold, emphasizing 20 florals and other specific decorative elements as described above in a specific manner, and as 21 displayed in the images presented to the Court, is distinctive. Because there is no natural 22 connection between the use of such aesthetic elements and the functionality of serving tea on a 23 bus, the Court finds Plaintiffs will likely succeed in establishing their trade dress is inherently 24 distinctive. 25 Although secondary meaning is not required to protect an inherently distinctive trade dress, 26 a brief discussion of secondary meaning is appropriate given the factors the court must consider in 27 a preliminary injunction inquiry. Trade dress acquires secondary meaning “when the purchasing 28 public associates the dress with a particular source.” Fuddruckers, Inc. v. Doc's B.R. Others, Inc., 1 826 F.2d 837, 843 (9th Cir. 1987). The fact that Plaintiffs have used the design elements described 2 herein on its buses and promotional materials for a substantial period of time suggests a strong 3 connection between the design and their company and product. As described above, Plaintiffs have 4 become a widely recognized brand precisely through their aesthetic marketing. Accordingly, the 5 Court finds that Plaintiffs are alternatively likely to prevail on the issue of secondary meaning. 6 3. Likelihood of Confusion 7 To determine whether Plaintiffs are entitled to injunctive relief regarding its trade dress 8 claim, the central inquiry is whether Defendants’ use of the asserted dress is likely to cause 9 consumer confusion. See Brookfield Commc'ns, 174 F.3d at 1053 (quoting Official Airline 10 Guides, Inc., 6 F.3d at 1391 (characterizing the likelihood of confusion inquiry as “[t]he core 11 element of trademark infringement”). A likelihood of confusion exists “when consumers are likely 12 to assume that a product or service is associated with a source other than its actual source because 13 of similarities between the two sources’ marks or marketing techniques.” Nutri/System, Inc. v. 14 Con–Stan Indus., Inc., 809 F.2d 601, 604 (9th Cir. 1987) (quoting Shakey's Inc. v. Covalt, 704 15 F.2d 426, 431 (9th Cir. 1983)). “Likelihood of confusion in the trade dress context is evaluated by 16 reference to the same factors used in the ordinary trademark context.” Vision Sports, Inc. v. 17 Melville Corp., 888 F.2d 609, 616 (9th Cir. 1989). 18 The Court has already found, in its analysis above, that the Sleekcraft factors weigh in 19 favor of Plaintiffs. Therefore, Plaintiffs have established by a preponderance of the evidence that 20 it will be able to prove a likelihood of consumer confusion at trial. 21 b. Irreparable Injury 22 By statute, Plaintiffs are entitled to a rebuttable presumption of irreparable harm because 23 it has shown a likelihood that it will succeed on the merits of its trademark infringement claim. 15 24 U.S.C. § 1116(a); see AK Futures LLC v. Boyd Street Distro, LLC, 35 F.4th 682, 694 (9th Cir. 25 2022) (“By statute, AK Futures is entitled to a rebuttable presumption of irreparable harm on its 26 trademark claim because the company has shown it will likely succeed on the merits.”). Evidence 27 of loss of control over business reputation and damage to goodwill can constitute irreparable harm 28 in the trademark infringement context. Herb Reed Enters., LLC v. Fla. Ent. Mgmt., Inc., 736 F.3d 1 1239, 1250 (9th Cir. 2013). 2 Defendants argue that the fact that they have already ceased to engage in the infringing 3 conduct—they have changed their name, propose changes to their brand and bus design, and 4 ceased operations while attempting to negotiate a settlement with Plaintiffs—means there is no 5 irreparable harm. However, the Court finds Defendants continued to use “Tea on the Strip” in their 6 website source code and, according to Defendants, though they can ensure social media tags of 7 “Tea on the Strip” are not directed to the “Café on the Strip” profile, prior to this injunction, 8 Defendants had not done so. Further, Defendants had indicated to this Court their intent to operate 9 with the brand and bus designs they most recently proposed to Plaintiffs and presented to the Court, 10 which the Court found are likely infringing. Therefore, Defendants have not rebutted the 11 presumption of irreparable harm. 12 Further, the Court specifically finds that the evidence of actual confusion Plaintiffs have 13 presented, coupled with the evidence presented that Defendants’ product is inferior to theirs, is 14 sufficient to show irreparable harm in the form of loss of control over business reputation and 15 damage to goodwill. 16 This factor therefore favors granting Plaintiffs a preliminary injunction that prohibits the 17 Defendants from continuing to use the “Tea on the Strip” trademark, and from using the interior 18 and exterior bus designs currently before the Court, both of which the Court finds are likely 19 infringing uses. 20 c. Balance of the Equities 21 In balancing the equities, “a court must balance the competing claims of injury and consider 22 the effect on each party of the granting or withholding of the requested relief.” Amoco Prod. Co. 23 v. Vill. of Gambell, AK, 480 U.S. 531, 542 (1987), abrogated in part on other grounds by Winter, 24 550 U.S. at 20. As discussed above, the Court finds Defendants have failed to rebut the 25 presumption of irreparable harm under 15 U.S.C. § 1116(a). Plaintiffs’ interest in preventing 26 further infringement of their trademark and trade dress outweighs Defendants’ interest in 27 continued use of the designs and branding this Court finds are likely infringing. 28 d. Public Interest 1 Before issuing an injunction, a court must ensure that the “public interest would not be 2 disserved.” eBay v. MercExchange, LLC, 547 U.S. 388, 391 (2006). “Trademarks protect the 3 public from confusion by accurately indicating the source of a product.” State of Idaho Potato 4 Comm'n v. G & T Terminal Packaging, Inc., 425 F.3d 708, 715 (9th Cir. 2005). Thus, preventing 5 consumer confusion serves the public interest. 6 e. Bond 7 Federal Rule of Civil Procedure 65(c) provides, in pertinent part: “The court may issue a 8 preliminary injunction ... only if the movant gives security in an amount that the court considers 9 proper to pay the costs and damages sustained by any party found to have been wrongfully enjoined 10 or restrained.” “Despite the seemingly mandatory language, Rule 65(c) invests the district court 11 ‘with discretion as to the amount of security required, if any.’” Johnson v. Couturier, 572 F.3d 12 1067, 1086 (9th Cir. 2009) (emphasis in original) (quoting Jorgensen v. Cassiday, 320 F.3d 906, 13 919 (9th Cir. 2003)). “The district court is afforded wide discretion in setting the amount of the 14 bond.” Conn. Gen. Life Ins. Co. v. New Images of Beverly Hills, 321 F.3d 878, 882 (9th Cir. 2003) 15 (citing Walczak v. EPL Prolong, Inc., 198 F.3d 725, 733 (9th Cir. 1999)). 16 Because “the purpose of ... a bond is to cover any costs or damages suffered by the [party 17 sought to be enjoined], arising from a wrongful injunction,” see Gorbach v. Reno, 219 F.3d 1087, 18 1092 (9th Cir. 2000), “the party affected by the injunction [bears the] obligation of presenting 19 evidence that a bond is needed.” See Conn. Gen, 321 F.3d at 883; accord Gorbach, 219 F.3d at 20 1092 (affirming district court’s decision not to require bond where the party sought to be enjoined 21 “did not show that there would be any” damages). Consequently, if the party affected by the 22 injunction fails to request a bond or submit any evidence regarding its likely damages, the court 23 does not abuse its discretion by setting a bond of zero. See Conn. Gen, 321 F.3d at 882–83. 24 In their previous Opposition to Plaintiffs’ Motions for preliminary relief, Defendants 25 request the Court require Plaintiffs to post a bond in the amount of $1 million dollars. However, 26 they have provided no financial analysis or documentary evidence to support a bond in this amount. 27 Further, the parties do not discuss the issue of the bond amount in briefing the renewed Motions. 28 Nevertheless, the Court in its discretion, finds a substantial bond is appropriate given the likely 1} cost to Defendants of ceasing operations to finalize their name change, redesign and remodel their bus, reestablish their social media presence under their new name and branding, and the like. 3 Accordingly, the Court in its discretion, sets the bond at $500,000. 4 V. CONCLUSION 5 The Court, having considered Plaintiffs’ Motions and the record, holds Plaintiffs have 6 | established their entitlement to injunctive relief, and GRANTS in part, the (ECF No. 32) Motion fora Preliminary Injunction. The Court orders as follows: 8 IT IS ORDERED that Defendants are enjoined from using the phrase “Tea on the Strip” 9 | and are ordered not to use that phrase as a keyword on their current website and to deactivate any 10 | social media tags using the phrase “Tea on the Strip” that redirect a user to their current social 11 media profiles; 12 IT IS FURTHER ORDERED that Defendants are enjoined from using the exterior and 13 | interior bus design as it was presented to the Court in the record and at the hearing; 14 IT IS FURTHER ORDERED that Plaintiffs are to post a $500,000 bond by Tuesday, April 22, 2025; 16 IT IS FURTHER ORDERED that the (ECF No. 31) Motion for a Temporary Rrestraining 17 | Order is DENIED as moot. 18 19 | DATED: June 4, 2025. 20 21 C 7 RICHARD F. BOULWARE, II UNITED STATES DISTRICT JUDGE 23 24 25 26 27 28
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