Industrias Wet Line S.A. de C.V. v. Multy Brands Distributors, Corp.

144 F. Supp. 3d 262, 2010 U.S. Dist. LEXIS 135658, 2010 WL 11243289
CourtDistrict Court, D. Puerto Rico
DecidedDecember 22, 2010
DocketCivil No. 10-1473 FAB
StatusPublished
Cited by2 cases

This text of 144 F. Supp. 3d 262 (Industrias Wet Line S.A. de C.V. v. Multy Brands Distributors, Corp.) is published on Counsel Stack Legal Research, covering District Court, D. Puerto Rico primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Industrias Wet Line S.A. de C.V. v. Multy Brands Distributors, Corp., 144 F. Supp. 3d 262, 2010 U.S. Dist. LEXIS 135658, 2010 WL 11243289 (prd 2010).

Opinion

OPINION AND ORDER

BESOSA, District Judge.

Before the Court is plaintiffs request for a preliminary injunction, (Docket No. 7). Subsequent to an evidentiary hearing regarding that motion, both parties filed memoranda proposing findings of fact and conclusions of law to be considered by the Court. (See Docket Nos. 65 & 66.) Having examined the evidence presented at the hearing and the arguments contained in the parties’ respective memoranda, the [264]*264Court DENIES the request for a preliminary injunction, (Docket No. 7).

DISCUSSION

I. Background

A. Procedural Background

On May 28, 2010, plaintiffs Industrias Wet Line S.A. de C.V. (‘Wet Line”), Morales Distributors, Inc. (“MDI”), and MC Brands, Corp. (“MCB”) filed a verified complaint against defendant Multy Brands Distributors Corporation (“MBD”), alleging trademark and trade dress infringement claims pursuant to the Lanham Act, 15 U.S.C. §§ 1114, 1125(a), Article 1802 of the Puerto Rico Civil Code, P.R. Laws Ann. tit. 31, § 5141, and Puerto Rico Trademark Law, P.R. Laws Ann. tit. 10, § 171x. (Docket No. 1.) On June 2, 2010, plaintiffs filed a motion for an ex parte temporary restraining order (“TRO”) and preliminary injunction. (Docket Nos. 7 & 8.) On the same date, the Court denied plaintiffs’ motion for an ex parte TRO and ordered plaintiffs to serve defendants with, inter alia, a copy of the complaint, the motion for a TRO and preliminary injunction, and the Court’s order. (Docket No. 9.)

Plaintiffs request a preliminary injunction to stop defendant from marketing and distributing a hair gel product which plaintiffs claim infringes upon their trademark and trade dress. (Docket No. 8.) On July 7, 2010, defendant filed a response in opposition to plaintiffs’ request for a preliminary injunction. (Docket No. 28.) On August 3, 2010, plaintiffs filed a reply. (Docket No. 38.)

On October 12, 13, and 14, 2010, an evidentiary hearing was held, during which both parties presented evidence to the Court regarding plaintiffs’ request for a preliminary injunction. (See Docket Nos. 55, 56, & 57.) At the conclusion of the hearing, the Court ordered the parties to file memoranda containing proposed findings of fact and conclusions of law no later than November 1, 2010. (Docket No. 64 at 111-12.) On that date, both parties complied with the Court’s order and filed their respective memoranda. (See Docket Nos. 65 & 66.)

B. Factual Background

The following factual background presents basic information necessary to frame the issues in this case and is based on the evidence presented at the evidentiary injunction hearing. In its legal analysis, the Court may include further factual information derived from evidence presented at that hearing as necessary.

Luis Morales Caro (“L. Morales”) is the founder and president of both MDI and MCB. Within those companies, L. Morales has approximately fifty employees. Given the workload that he carries, L. Morales delegates tasks to different supervisors for various aspects of his business, including logistics, purchasing, public relations, administration, and invoicing. In 2005, L. Morales was able to negotiate the exclusive distribution rights for the Xtreme line of hair products. This line has been distributed in Puerto Rico since October of 2003, and is manufactured by Wet Line.

Wet Line is a Mexican corporation based in Guadalajara, Mexico. Wet Line has agreements with various companies to distribute its products in different geographical locations. L. Morales is the official distributor for the island of Puerto Rico and the area of Santo Domingo in the Dominican Republic. Mexilink is another company affiliated with Wet Line, and distributes Xtreme products in Texas.

In Puerto Rico, L. Morales markets Xtreme products in numerous pharmacies, chain discount stores, grocery stores, and supermarkets. Of the many different Xtreme products sold in those locations, the thirty-five ounce container of Xtreme [265]*265Professional gel generates the highest revenue in sales. It is marketed toward a youth demographic and has a “fixation” level which can be used by most consumers. • It is packaged in a transparent, octagonal jar with a label depicting the Xtreme Professional logo, which consists of the words “Xtreme Professional” in blue and white lettering in the foreground and a large green “X” with blue and white accents in the background. This particular product, sold under the product code XT63030, is marketed with both a green lid, as well as a clear lid. Wet Line owns a U.S. Trademark registration on the principal register with regard to the design of the logo, but not with regard to the color scheme. Wet Line also owns a U.S. Trademark registration on the supplemental register with regard to the shape of the container for the thirty-five ounce size of Xtreme Professional gel.

MBD distributes a competing hair gel called Super Wet, which is produced by Industrias Gane (“Gane”), which is also a Mexican corporation based in Guadalajara, Mexico. The president of MDB is Rafael Morales Caro (“R. Morales”). R. Morales is L. Morales’s brother and, until leaving to start MBD in 2009, was the General Manager at MCB and MDI. As the General Manager at those companies, R. Morales was in charge of meetings, setting sales routes, supervising the sales staff, and coordinating promotions.

Within the Super Wet product line, MBD markets a thirty-five ounce container of Super Wet gel, which is geared toward the same demographic and distributed in many of the same locations as Xtreme Professional gel. Although originally marketed with a black label, the thirty-five ounce container of Super Wet gel adopted new packaging shortly after being introduced to Puerto Rico. That container is now sold in Puerto Rico in a clear, multi-sided jar with a predominantly green label and a green lid. The label contains a Super Wet logo consisting of the words “Super Wet Natural Look” in white and blue lettering in the foreground and a green circle design with blue and white accents in the background.

II. Legal Analysis

A. Standard for Preliminary Injunc-tive Relief

When determining whether a preliminary injunction is appropriate, a “court must consider (1) the likelihood of the movant’s success on the merits; (2) the anticipated incidence of irreparable harm if the injunction is denied; (3) the balance of the relevant equities (i.e., the hardship that will befall the nonmovant if the injunction issues contrasted with the hardship that will befall the movant if the injunction does not issue); and (4) the impact, if any, of the court’s action on the public interest.” Borinquen Biscuit Corp. v. M.V. Trading Corp., 443 F.3d 112, 115 (1st Cir.2006) (citing Ross-Simons of Warwick, Inc. v. Baccarat, Inc., 102 F.3d 12, 15 (1st Cir.1996); Narragansett Indian Tribe v. Guilbert, 934 F.2d 4, 5 (1st Cir.1991)).

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144 F. Supp. 3d 262, 2010 U.S. Dist. LEXIS 135658, 2010 WL 11243289, Counsel Stack Legal Research, https://law.counselstack.com/opinion/industrias-wet-line-sa-de-cv-v-multy-brands-distributors-corp-prd-2010.