Servpro Indus. Inc. v. Zerorez of Phx. LLC

339 F. Supp. 3d 898
CourtDistrict Court, D. Arizona
DecidedSeptember 7, 2018
DocketNo. CV-17-00862-PHX-ROS
StatusPublished

This text of 339 F. Supp. 3d 898 (Servpro Indus. Inc. v. Zerorez of Phx. LLC) is published on Counsel Stack Legal Research, covering District Court, D. Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Servpro Indus. Inc. v. Zerorez of Phx. LLC, 339 F. Supp. 3d 898 (D. Ariz. 2018).

Opinion

Honorable Roslyn O. Silver, Senior United States District Judge

Since 2003, Servpro Industries Inc. has used its registered trademark "Like it Never Even Happened" in advertising its restoration and cleaning services. For approximately three months in early 2017, Zerorez of Phoenix LLC used the phrase "Like it Never Happened" in its advertisements for carpet cleaning services. Servpro believes those advertisements infringed its trademark as a matter of law. Zerorez believes consideration of the larger context shows it did not infringe the trademark as a matter of law. Zerorez is correct.

BACKGROUND

For purposes of resolving the motion for summary judgment filed by Zerorez, the Court describes the record in the light most favorable to Servpro. Fortunately, most of the relevant facts are undisputed.

A. Servpro's Business and Advertising

Servpro "is one of the world's largest providers of cleanup and restoration products and services." (Doc. 1 at 4). Servpro has more than 1,700 franchisees operating in the United States with eighteen franchisees in the Phoenix area. Servpro describes the services its franchisees offer as "carpet, furniture and drapery cleaning services; restoration of building structures damaged by fire, water and other catastrophes both indoors and outdoors; restoration of furniture damaged by fire, water and other catastrophes; and mold remediation services." (Doc. 1 at 5).

In marketing its services, Servpro uses a "House Logo" as "the primary identifier for the company." (Doc. 79-1 at 65). Servpro's House Logo is:

In addition to its House Logo, Servpro also uses a phrase it describes as its "Brand Descriptor." That phrase is usually portrayed as:

In advertisements, the Brand Descriptor is usually "positioned below the SERVPRO House Logo." (Doc. 79-1 at 70).

Finally, Servpro uses what it calls a "Branding Statement," which is actually the trademark at issue in this litigation. The trademark is "Like it never even happened." Servpro requires franchisees include the trademark in "[e]very ad and marketing piece ... except small advertisements where space does not permit." (Doc. 79-1 at 69). Typically, the trademark is placed at the bottom of an advertisement. (Doc. 79-1 at 69). Servpro and its franchisees often include the House Logo, Brand Descriptor, and Branding Statement in advertisements. One such example is:

*902B. Zerorez's Business and Advertising

Zerorez Franchising, Inc. "is a carpet, upholstery and hard-surface (e.g. stone and granite) cleaning company." (Doc. 98 at 3). There are numerous Zerorez franchisees throughout the country, one of which is Zerorez of Phoenix LLC ("Zerorez"). Zerorez Franchising differentiates itself from other carpet cleaning services by touting its "patented cleaning system with Empowered Water." Zerorez Franchising describes "Empowered Water" as an alternative to traditional water and soap mixtures. Zerorez performs cleaning services but does not perform "any restoration services" similar to those provided by Servpro.

Zerorez Franchising owns a number of trademarks, including "Zerorez" and "Empowered Water." The "primary logo" used by Zerorez Franchising and its franchisees is a trademark consisting of three rows of three concentric circles:

All of the Zerorez advertisements in the record include one or more of the trademarks.

C. Zerorez's Alleged Infringement

On December 7, 2016, a few Zerorez employees attended a marketing meeting. (Doc. 98 at 36). At that meeting, a Zerorez employee suggested "the theme and tagline 'Like it Never Happened.' " The meeting participants agreed to use the phrase in future advertisements. On January 1, 2017, Zerorez updated its website to include the phrase on its homepage. From January 1 to March 27, 2017, visitors to the homepage encountered the following:

*903Of particular importance, that webpage included the "primary logo," two instances of "Zerorez," one instance of "Zerorezified," and one instance of "Empowered Water." From January 16 through March 27, 2017, Zerorez also used the "Like it Never Happened" phrase on billboard advertisements such as:

Again, that billboard prominently features the primary logo and the Zerorez name. Zerorez also used the "Like it Never Happened" phrase in radio ads, on its Facebook *904page, and on a direct mail postcard. The radio ads included Zerorez's name. The Facebook page and direct mail postcard used Zerorez's name and its primary logo.

Shortly after Zerorez started using "Like it Never Happened," a Zerorez employee saw two Servpro employees wearing shirts with the Servpro House Logo and "Like it never even happened." (Doc. 98 at 48). The Zerorez employee sent a text message to other Zerorez employees stating "I just saw some Serve Pro [sic] guys. Their shirts say 'like it never even happened.' It's trademarked. We aren't using the 'even' but do we want to get that close?" Another Zerorez employee responded "Clorox cleanup has a commercial titled. Like it never happened." Another employee stated they had researched the issue and concluded the Zerorez "version was safe." (Doc. 83-3 at 14). Zerorez continued to use the phrase.

In late February 2017, Servpro learned Zerorez was using the phrase. On March 23, 2017, Servpro filed the present case, accusing Zerorez of infringing its trademark under federal law and unfair competition under Arizona law. The parties pursued discovery and in June 2018, they filed cross-motions for summary judgment.

ANALYSIS

The parties' motions focus on Servpro's claim for trademark infringement under federal law but the federal and state law claims all share a common requirement. For Servpro to prevail on any of its claims, it must prove Zerorez's use of the phrase was "likely to cause consumer confusion." Network Automation, Inc. v. Advanced Sys. Concepts, Inc. , 638 F.3d 1137, 1144 (9th Cir. 2011) (federal trademark law requires likelihood of consumer confusion); Angel's Gate Inc. v. All-Star Grand Canyon Tours Inc. , No. CV-12-08181-NVW, 2013 WL 12114580, at *3 (D. Ariz. Sept. 30, 2013) (state unfair competition requires likelihood of consumer confusion). If use of the phrase did not create a likelihood of consumer confusion, Zerorez is entitled to summary judgment on all of Servpro's claims. Therefore, the likelihood of confusion is the appropriate focus.

"The test for likelihood of confusion is whether a 'reasonably prudent consumer' in the marketplace is likely to be confused as to the origin of the good or service bearing one of the marks." Dreamwerks Prod. Grp., Inc. v. SKG Studio , 142 F.3d 1127

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Bluebook (online)
339 F. Supp. 3d 898, Counsel Stack Legal Research, https://law.counselstack.com/opinion/servpro-indus-inc-v-zerorez-of-phx-llc-azd-2018.