Stensrud Incorporated v. Unknown Parties

District Court, D. Arizona·Decided March 1, 2024·No. 2:24-cv-00334·Unknown

Opinion

WO

Stensrud Incorporated, et al., No. CV-24-00334-PHX-DJH

Plaintiffs, PRELIMINARY INJUNCTION ORDER v.

Unknown Parties,

Defendant. On February 22, 2024, the Court issued an ex parte Temporary Restraining Order (“TRO”) (Doc. 13) 1 in favor of Plaintiff Stensrud, Inc. (“Plaintiff Stensrud”) and Plaintiff Benito Antonio Martinez Ocasio a/k/a Bad Bunny (“Plaintiff Bad Bunny”) (collectively, “Plaintiffs”) against Defendants, various John Does, Jane Does and ABC Companies (collectively, the “Unauthorized Merchandisers”). As required by Federal Rule of Civil Procedure 65(a)(1) and (b)(3), the Court held a hearing on February 29, 2024, (the “Hearing”) to determine whether the TRO should convert to a Preliminary Injunction (“PI”). In advance of the Hearing, Plaintiff filed declarations showing service was effectuated on at least eight Unauthorized Merchandisers. (Doc. 17-1). Despite this, none of the Unauthorized Merchandisers appeared at the Hearing, and the Court found cause to convert the TRO to a PI that applied to all other concerts associated with Plaintiff Bad Bunny’s 2024 tour (the “2024 Concert Tour”). The following is an Order formalizing the Court’s oral ruling issuing the Preliminary Injunction.

1 The ex parte Temporary Restraining Order was limited to Plaintiff Bad Bunny’s concerts that took place at the Footprint Center in Phoenix, Arizona on February 27 and 28, 2024. I. Background2 The TRO was based on Plaintiffs’ claim under the Lanham Act, 15 U.S.C. § 1125(a), against the Unauthorized Merchandisers’ infringing use of the BAD BUNNY trademark. (Doc. 1 at ¶¶ 15–26). Plaintiff Bad Bunny has used the BAD BUNNY trademark, Registration No. 77245510, to identify his services as a musical performer since 2016. (Id. at ¶ 5, 10). To date, 50 million dollars worth of licensed BAD BUNNY merchandise has been sold. (Id. at ¶ 9). Plaintiff Bad Bunny granted Plaintiff Stensrud the exclusive rights to sell or license the sale of BAD BUNNY merchandise during the 2024 Concert Tour. (Id. at ¶ 9). The 2024 Concert Tour will take place at various locations throughout the United States from February–May 2024. (Id. at 9–10); see also Exhibit A attached to this Order. Plaintiffs claim the Unauthorized Merchandisers are travelling from state to state to follow Plaintiff Bad Bunny’s concerts and sell unlicensed and infringing merchandise that bear the BAD BUNNY trademark, likeness, and logos. Plaintiffs sought nationwide injunctive relief to preclude them from doing so. The Court issued a TRO that restrained the Unauthorized Merchandisers from selling unlicensed and infringing merchandise that bear the BAD BUNNY trademark, likeness, and logos at Plaintiff Bad Bunny’s concerts at the Footprint Center in Phoenix, Arizona on February 27 and 28, 2024 (the “Footprint Center Concerts”). (See generally Doc. 13). The TRO was limited in geographical scope because the Court did not have sufficient information to confirm whether the Unauthorized Merchandisers in this case are indeed the same travelling individuals or affiliated therewith. (Id. at 4). However, the Court indicated it would revisit Plaintiffs’ request for nationwide injunctive relief at the Hearing. (Id.) At the Hearing, Plaintiffs submitted evidence showing unauthorized merchandise that was sold outside of Plaintiff Bad Bunny’s concerts in Las Vegas on February 24 and 25, 2024 (the “Las Vegas Concerts), are identical to merchandise seized at the Footprint 2 The Court’s TRO contains extensive background information. (See Doc. 13 at 2). The Court presumes the parties’ familiarity with the TRO, and as such, provides only an abbreviated version of the background facts here. Center Concerts (Compare Doc. 17-2 (unauthorized Las Vegas merchandise) with Doc. 17-3 (unauthorized Arizona merchandise)). Plaintiffs also submitted evidence showing that at least three individuals who were photographed selling unlicensed merchandise at the Las Vegas Concerts and at Plaintiff Bad Bunny’s concert in Salt Lake City, Utah on February 21, 2024 (the “Utah Concert”) were the same Unauthorized Merchandisers served at the Footprint Center Concerts. (Docs. 17-4; 17-5; 17-6). II. Legal Standard Preliminary injunctive relief is an “extraordinary remedy never awarded as of right.” Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 24 (2008). To obtain a preliminary injunction, a plaintiff must show: (1) a likelihood of success on the merits, (2) a likelihood of irreparable harm if injunctive relief were denied, (3) that the equities weigh in the plaintiff’s favor, and (4) that the public interest favors injunctive relief. Id. at 20. The movant carries the burden of proof on each element of the test. See Los Angeles Memorial Coliseum Comm’n v. National Football League, 634 F.2d 1197, 1203 (9th Cir. 1980). The Ninth Circuit also employs a “sliding scale” approach to preliminary injunctions, under which “the elements of the preliminary injunction test are balanced, so that a stronger showing of one element may offset a weaker showing of another.” All. for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1131 (9th Cir. 2011). The issuance of a preliminary injunction may be appropriate when there are “‘serious questions going to the merits’ and a balance of hardships that tips sharply towards the plaintiff . . . so long as the plaintiff also shows that there is a likelihood of irreparable injury and that the injunction is in the public interest.” Id. at 1135. “[C]ourts ‘must balance the competing claims of injury and must consider the effect on each party of the granting or withholding of the requested relief,’” and should be particularly mindful, in exercising their sound discretion, of the “public consequences in employing the extraordinary remedy of injunction.” Id. at 24 (citations omitted). / / / / / / III. Discussion The Court will convert the prior TRO against the Unauthorized Merchandisers into a PI because consideration of the Winter factors presently weigh in the Plaintiffs’ favor. 1. Likelihood of Success on the Merits First, the Unauthorized Merchandisers’ acts likely constitute trademark infringement under the Lanham Act, 15 U.S.C. § 1125(a). The Act “creates a federal civil cause of action for unauthorized use of a registered trademark.” Slep-Tone Entm’t Corp. v. Wired for Sound Karaoke & DJ Servs., LLC, 845 F.3d 1246, 1248 (9th Cir. 2017). To establish a prima facie case for trademark infringement, Plaintiffs must show: (1) ownership in a valid, protectable trademark; and (2) the defendant’s unauthorized use of the mark in commerce is likely to cause confusion. See Brookfield Commc’ns, Inc. v. W. Coast Ent. Corp., 174 F.3d 1036, 1046 (9th Cir. 1999); see also 15 U.S.C. § 1114(1). Plaintiffs have established proof of ownership because Plaintiff Bad Bunny registered the BAD BUNNY trademark in the federal Principal Register at No. 77245510 (Doc. 1 at ¶ 5, 10), and Plaintiff Bad Bunny granted Plaintiff Stensrud the exclusive rights to sell or license the sale of merchandise bearing the BAD BUNNY trademark during the 2024 Concert Tour, (id. at ¶ 9). See Pom Wonderful LLC v. Hubbard,

Stensrud Incorporated v. Unknown Parties, (D. Ariz. 2024).

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