Read-A-Thon Fundraising Co Inc v. 99Pledges LLC

CourtDistrict Court, N.D. Texas
DecidedJuly 12, 2022
Docket3:22-cv-00420
StatusUnknown

This text of Read-A-Thon Fundraising Co Inc v. 99Pledges LLC (Read-A-Thon Fundraising Co Inc v. 99Pledges LLC) is published on Counsel Stack Legal Research, covering District Court, N.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Read-A-Thon Fundraising Co Inc v. 99Pledges LLC, (N.D. Tex. 2022).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION READ-A-THON FUNDRAISING CO., § INC., § § Plaintiff, § § Civil Action No. 3:22-CV-0420-D VS. § § 99PLEDGES, LLC, § § Defendant. § MEMORANDUM OPINION AND ORDER Plaintiff Read-A-Thon Fundraising Co., Inc. (“Read-A-Thon”) sues defendant 99Pledges, LLC (“99Pledges”) to recover on federal trademark infringement and related claims. 99Pledges moves under Fed. R. Civ. P. 12(b)(6) to dismiss the claims against it. For the reasons explained, the court grants the motion with respect to Read-A-Thon’s federal trademark dilution claim, denies the motion as to all other claims, and grants Read-A-Thon leave to replead. I Read-A-Thon is a company that provides, inter alia, charitable fundraising services and non-downloadable software for tracking student progress in the field of reading (“Goods and Services”).1 It offers its Goods and Services in interstate commerce under its federally- 1In deciding 99Pledges’ Rule 12(b)(6) motion, the court construes the complaint in the light most favorable to Read-A-Thon, accepts as true all well-pleaded factual allegations, and draws all reasonable inferences in Read-A-Thon’s favor. See, e.g., Lovick v. Ritemoney Ltd., 378 F.3d 433, 437 (5th Cir. 2004). “The court’s review [of a Rule 12(b)(6) motion] is registered READ-A-THON and READATHON trade names, trademarks, and service marks (“READ-A-THON Marks”). It maintains that it has continuously used its READ-A-THON Marks since at least as early as June 20132 and that they “ha[ve] gained valuable public

recognition and fame in the United States in identifying Read-A-Thon as the exclusive source of the Read-A-Thon Goods and Services.” Compl. ¶ 13. In this lawsuit, Read-A-Thon alleges that 99Pledges has marketed and sold charitable fundraising services that are substantially related to, and directly competitive with, Read-A-

Thon’s Goods and Services under the marks “READ-A-THON” and other substantially identical variations (“Allegedly Infringing Marks”), which is confusingly identical to the READ-A-THON Marks. It sues 99Pledges for federal trademark infringement, federal trademark dilution, unfair competition under the Lanham Act, and common law unfair competition, and it seeks damages, injunctive relief, and attorney’s fees.

99Pledges moves under Rule 12(b)(6) to dismiss Read-A-Thon’s action against it. Read-A-Thon opposes the motion. The court is deciding the motion on the briefs.

limited to the complaint, any documents attached to the complaint, and any documents attached to the motion to dismiss that are central to the claim and referenced by the complaint.” Lone Star Fund V (U.S.), L.P. v. Barclays Bank PLC, 594 F.3d 383, 387 (5th Cir. 2010). 2Read-A-Thon has used its READ-A-THON Marks since December 1993 for its International Class 36 Goods and Services and since June 2013 for its International Class 9 Goods and Services. - 2 - II Under Rule 12(b)(6), the court evaluates the pleadings by “accept[ing] ‘all well-pleaded facts as true, viewing them in the light most favorable to the plaintiff.’” In re

Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007) (quoting Martin K. Eby Constr. Co. v. Dall. Area Rapid Transit, 369 F.3d 464, 467 (5th Cir. 2004)). To survive 99Pledges’ motion to dismiss, Read-A-Thon must allege enough facts “to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).

“A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “The plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Id.; see also Twombly, 550 U.S. at 555 (“Factual allegations must be

enough to raise a right to relief above the speculative level[.]”). “[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged—but it has not ‘shown’—‘that the pleader is entitled to relief.’” Iqbal, 556 U.S. at 679 (alteration omitted) (quoting Rule 8(a)(2)). Furthermore, under Rule 8(a)(2), a pleading must contain “a short and plain statement of the claim showing that the pleader

is entitled to relief.” Although “the pleading standard Rule 8 announces does not require ‘detailed factual allegations,’” it demands more than “labels and conclusions.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555). And “a formulaic recitation of the elements of a cause of action will not do.” Id. (quoting Twombly, 550 U.S. at 555). - 3 - To obtain a Rule 12(b)(6) dismissal based on an affirmative defense, “the successful affirmative defense [must] appear[ ] clearly on the face of the pleadings.” Cochran v. Astrue, 2011 WL 5604024, at *1 (N.D. Tex. Nov. 17, 2011) (Fitzwater, C.J.) (quoting Sivertson v.

Clinton, 2011 WL 4100958, at *2 (N.D. Tex. Sept. 14, 2011) (Fitzwater, C.J.)). In other words, 99Pledges is not entitled to dismissal under Rule 12(b)(6) based on an affirmative defense unless Read-A-Thon “has pleaded [it]self out of court by admitting to all of the elements of the defense.” Id. (quoting Siverston, 2011 WL 4100958, at *3).

III The court begins by considering 99Pledges’ argument that its use of the word “read-a- thon” is protected by the Lanham Act’s statutory fair-use defense. A Under 15 U.S.C. § 1115(b)(4), the affirmative defense of fair use is available to a

party whose “use of the name, term, or device charged to be an infringement is a use, otherwise than as a mark, . . . of a term or device which is descriptive of and used fairly and in good faith only to describe the goods or services of such party, or their geographic origin.” Id. Essentially, the fair-use defense prevents a trademark registrant from “appropriat[ing] a descriptive term for [its] exclusive use” and, by so doing, “prevent[ing] others from

accurately describing a characteristic of their goods.” Soweco, Inc. v. Shell Oil Co., 617 F.2d 1178, 1185 (5th Cir. 1980). To establish the statutory fair use defense, the defendant must demonstrate that it made use of the allegedly infringing mark “(1) other than as a mark, (2) in a descriptive - 4 - sense, and (3) in good faith.” EMI Catalogue P’ship v. Hill, Holliday, Connors, Cosmopulos Inc., 228 F.3d 56, 64 (2d Cir. 2000) (citations omitted); see also Soweco, Inc., 617 F.2d at 1185 (noting that the fair-use defense described in 15 U.S.C. § 1115(b)(4) “is available only

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Bluebook (online)
Read-A-Thon Fundraising Co Inc v. 99Pledges LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/read-a-thon-fundraising-co-inc-v-99pledges-llc-txnd-2022.