LegalForce RAPC Worldwide P.C. v. Demassa

CourtDistrict Court, N.D. California
DecidedApril 6, 2021
Docket3:18-cv-00043
StatusUnknown

This text of LegalForce RAPC Worldwide P.C. v. Demassa (LegalForce RAPC Worldwide P.C. v. Demassa) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
LegalForce RAPC Worldwide P.C. v. Demassa, (N.D. Cal. 2021).

Opinion

1 2 3 4 5 IN THE UNITED STATES DISTRICT COURT 6 FOR THE NORTHERN DISTRICT OF CALIFORNIA 7 8 LEGALFORCE RAPC WORLDWIDE Case No. 18-cv-00043-MMC P.C., 9 Plaintiff, MEMORANDUM OF DECISION; 10 FINDINGS OF FACT AND v. CONCLUSIONS OF LAW 11 CHRIS DEMASSA, 12 Defendant.

13 14 In this action, plaintiff LegalForce RAPC Worldwide, P.C. ("LegalForce") alleges 15 defendant Chris DeMassa ("DeMassa") and persons he employs are engaging in the 16 unauthorized practice of law, thereby violating § 17200 of the California Business & 17 Professions Code. 18 On November 30, 2020, and December 1, 2020, the Court conducted a trial on 19 LegalForce's claim against DeMassa. Wensheng Ma and Nicholas Craft of LegalForce 20 appeared on behalf of LegalForce. Joyce Li and Andrew Jones of Durie Tangri LLP 21 appeared on behalf of DeMassa. Having considered the evidence presented and the 22 arguments of counsel, as well as the parties' posttrial filings,1 the Court rules as follows. 23 // 24

25 1 On December 9, 2020, DeMassa filed a "Motion for Judgment Under Rule 52(c), or, in the Alternative, under Rule 52(a)," which motion has been fully briefed. As a 26 judgment under either Rule 52(a) or 52(c) must be supported by findings of fact and conclusions of law, see Fed. R. Civ. P. 52(a), 52(c), the Court will not separately rule on 27 DeMassa's motion, but, rather, will address in the instant Memorandum of Decision the 1 BACKGROUND 2 LegalForce is a law firm that provides services to individuals and businesses 3 seeking to register trademarks with the United States Patent and Trademark Office 4 ("USPTO"). DeMassa, an individual doing business under the name Trademark Express, 5 also provides such services. Neither DeMassa nor any of his employees is an attorney. 6 In the operative complaint, the Second Amended Complaint ("SAC"), LegalForce seeks 7 an injunction prohibiting DeMassa and his employees from continuing to operate 8 Trademark Express in a manner that, according to LegalForce, constitutes the 9 unauthorized practice of law. 10 DISCUSSION 11 Section 17200 prohibits "unfair competition," including “any unlawful, unfair or 12 fraudulent business act or practice." See Cal. Bus. & Prof. § 17200. Here, LegalForce 13 asserts Trademark Express is engaging in an "unlawful" practice, see id., specifically, the 14 unauthorized practice of law in violation of 37 C.F.R. § 11.14, which regulation provides 15 that "[i]ndividuals who are not attorneys are not recognized to practice before the 16 [USPTO] in trademark . . . matters," see 37 C.F.R. § 11.14(b).2 17 A. Statutory Standing 18 The Court first considers whether LegalForce has shown it has standing to bring 19 its § 17200 claim. 20 To have standing to seek relief under § 17200, a plaintiff must have "suffered 21 injury in fact and . . . lost money or property as a result of the unfair competition," see Cal. 22 Bus. & Prof. Code § 17204, and must establish those facts "by a preponderance of the 23 evidence," see Troyk v. Farmers Group, Inc., 171 Cal. App. 4th 1305, 1351 (2009). 24 Here, at trial, Raj Abhyanker ("Abhyanker"), the sole owner of LegalForce, testified 25 the gross revenue LegalForce earned from its trademark practice "decreased from 2015 26

27 2 All other claims asserted in the SAC have been voluntarily dismissed by 1 to 2019" (see Transcript of Zoom Video Bench Trial Proceedings ("Tr.") 27:10-13, 73:4-9, 2 74:8-15) and that it has had to "charge less" in the "face of competition" (see Tr. 32:2-3). 3 As discussed below, however, there is no evidence linking any such decrease3 to 4 Trademark Express. 5 Both Trademark Express and LegalForce have been providing trademark services 6 for a considerable period of time, Trademark Express since 1993 (see Tr. 236:19-25) and 7 LegalForce since 2005 (see Tr. 27:9-17). LegalForce, however, has not offered evidence 8 to support a finding that any decrease in business it began experiencing in 2015 is the 9 result of the continued presence of Trademark Express, as opposed to general market 10 conditions.4 LegalForce offered no evidence, for example, that Trademark Express, in or 11 around 2015 or thereafter, changed its business practices, revised its marketing efforts, 12 or lowered its prices, evidence which might, arguably, have supported a finding that any 13 revenue LegalForce lost was realized, at least in part, by Trademark Express. 14 Indeed, with respect to pricing, it is undisputed that the prices charged by 15 Trademark Express have always been hundreds of dollars higher than those charged by 16 LegalForce. (See Tr. 65:24-66:4; Tr. 208:19-24; Tr. 210:23-211:5.) Consequently, to the 17 extent LegalForce claims it had to lower its prices, LegalForce fails to show any revenue 18 lost thereby is attributable to Trademark Express. 19 To the extent LegalForce argues it has lost customers to Trademark Express, 20 such argument likewise is unavailing. In support thereof, LegalForce relies on 21 DeMassa's trial testimony, in particular, that, "over the last ten years," but "less lately," he 22 has heard complaints about LegalForce, including that "[t]hey are a horrible service" and 23 3 No testimony or other evidence was provided as to the amount thereof. 24 4 One such condition, as Abhyanker acknowledges, is competition from multiple 25 other entities providing trademark services, and LegalForce has sued at least seven of them, including its two "biggest" competitors, namely, LegalZoom and Trademark Engine, 26 as well as TTC Business Solutions, Greenside, MyCorporation Business Services, and FileMy, LLC. (See Tr. 136:9-137:9; 137:13-138:14; 141:4-15); see also Tr. 137:10-12 27 (acknowledging Iocab as additional competitor, but lacking recollection as to whether it 1 "[t]hey don't do any research" (see Tr. 392:5-16), that persons who made such 2 complaints had contacted Trademark Express, either by telephone or email, because 3 they were "trying to fix their trademarks that were botched by Trademarkia"5 and "would 4 have to refile another name usually" (see Tr. 392:21-393:1), and that "some" or, perhaps, 5 "most" of those persons became Trademark Express customers (see Tr. 393:11-12). 6 Given the unspecified time frame within which any such contacts occurred, and 7 the lack of other evidence as to when any former LegalForce customer became a 8 customer of Trademark Express, however, the Court lacks sufficient evidence to find any 9 of the above-referenced complaining individuals became Trademark Express customers 10 within the applicable limitations period, namely, on or after January 3, 2014.6 11 Of equal or greater importance, there is insufficient evidence that any such 12 individuals ceased being customers of LegalForce as a result of Trademark Express's 13 assertedly unauthorized practice of law. Rather, the more reasonable inference is that 14 those customers left LegalForce as a result of their dissatisfaction with the service they 15 received from LegalForce and that they were no longer customers of LegalForce when 16 they began searching for assistance from some other provider. Indeed, LegalForce 17 offered no evidence to support a finding that any such former customer, in the absence of 18 Trademark Express, would have returned to LegalForce, as opposed to seeking 19 assistance from one of its competitors. See Kwikset Corp. v Superior Court, 51 Cal. 4th 20 310, 326 (2011) (holding "plaintiff's economic injury" must be "caused by" claimed unfair 21 business practice).

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Bluebook (online)
LegalForce RAPC Worldwide P.C. v. Demassa, Counsel Stack Legal Research, https://law.counselstack.com/opinion/legalforce-rapc-worldwide-pc-v-demassa-cand-2021.