Thermolife International, LLC v. Am. Fitness Wholesalers, LLC

• Court: Court of Appeals for the Ninth Circuit
• Decided: December 15, 2020
• Docket: 20-15163
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS DEC 15 2020 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

THERMOLIFE INTERNATIONAL, LLC, No. 20-15163 an Arizona limited liability company, 20-15807

Plaintiff-Appellant, D.C. No. 2:18-cv-04189-JAT

v. MEMORANDUM* AMERICAN FITNESS WHOLESALERS, L.L.C., DBA A1Supplements, a Tennessee corporation,

Defendant-Appellee.

Appeal from the United States District Court for the District of Arizona James A. Teilborg, District Judge, Presiding

Submitted December 11, 2020** San Francisco, California

Before: BOGGS,*** M. SMITH, and BENNETT, Circuit Judges.

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). *** The Honorable Danny J. Boggs, United States Circuit Judge for the U.S. Court of Appeals for the Sixth Circuit, sitting by designation. Appellant ThermoLife International LLC (ThermoLife) appeals dismissal of

its Lanham Act (15 U.S.C. § 1125), common-law unfair-competition, and false-

patent-marking (35 U.S.C. § 292) claims against Appellee American Fitness

Wholesalers LLC, d/b/a A1Supplements (A1). Because the parties are familiar

with the facts, we do not recount them here, except as necessary to provide context

to our ruling. We have jurisdiction under 28 U.S.C. § 1291. We review de novo the

district court’s dismissal under Federal Rule of Civil Procedure 12(b)(6). Gingery

v. City of Glendale, 831 F.3d 1222, 1226 (9th Cir. 2016). We AFFIRM.1

ThermoLife alleges that A1 unfairly competed and violated the Lanham Act

by advertising and selling allegedly illegal dietary supplements on A1’s website.

A1 also sells products that contain ThermoLife ingredients on its website, which

ThermoLife refers to as “ThermoLife Component Products.” ThermoLife claims

that its overall sales dropped in 2016 as a result of A1’s sale of illegal products.

However, ThermoLife offers only conclusory allegations and fails to

plausibly connect its 2016 drop in sales of component ingredients to A1’s alleged

advertising and sale of allegedly illegal products. Therefore, the district court

1 We deny Natural Products Association’s motion for leave to file an amicus brief because it is untimely by almost three months and offers no explanation as to why the court should excuse the late filing. See Marbled Murrelet v. Babbitt, 83 F.3d 1060, 1062 n.1 (9th Cir. 1996) (denying motion to file amicus brief because the “motion was filed late and there was no attempt to show good cause for the late filing”).

2 properly dismissed ThermoLife’s Lanham Act claim because ThermoLife has not

shown that its injury was proximately caused by any alleged Lanham Act violation.

See Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118, 132–34

(2014).

In addition, because ThermoLife’s common-law unfair-competition and

Lanham Act claims are substantially similar, ThermoLife’s unfair-competition

claim fails for the same reasons. See Cleary v. News Corp., 30 F.3d 1255, 1263

(9th Cir. 1994).

The district court also properly dismissed ThermoLife’s false-marking claim

because ThermoLife failed to plead facts to particularly or plausibly establish a

competitive injury, a false marking, or an intent to deceive the public. Importantly,

ThermoLife does not allege facts about the patent rights of APS Nutrition—the

alleged manufacturer of the product at issue—nor does ThermoLife sufficiently

allege knowledge by A1 of APS Nutrition’s patent rights. Instead, ThermoLife

alleges that A1 lacks purported patent rights to APS Nutrition’s product, which

fails to satisfy Federal Rule of Civil Procedure 9(b)’s heightened pleading

standard. See Juniper Networks, Inc. v. Shipley, 643 F.3d 1346, 1350 (Fed. Cir.

2011).

Finally, the district court did not abuse its discretion by concluding this was

an “exceptional case” that authorized awarding A1 its attorney’s fees relating to its

3 second successful motion to dismiss. Despite specific instructions from the district

court when it dismissed the first complaint, ThermoLife failed to cure the

deficiencies in its proximate-cause allegations to plausibly connect its alleged drop

in overall sales to A1’s advertising and sale of allegedly illegal dietary

supplements. Instead, ThermoLife’s conclusory allegations that its sales dropped in

2016, and that the drop must be attributed to A1’s advertising and sale of allegedly

illegal dietary supplements, ignore the obvious alternative explanations identified

by the district court such as other legal dietary supplements cutting into

ThermoLife’s profits or an industry-wide drop in dietary-supplement sales. By

failing to correct the deficiencies identified by the district court, ThermoLife

proceeded unreasonably in the litigation by filing its Amended Complaint, and as

the district court concluded, had no reasonable or legal basis to believe in success

on the merits of its claims. See Octane Fitness, LLC v. ICON Health & Fitness,

Inc., 572 U.S. 545, 554 (2014); SunEarth, Inc. v. Sun Earth Solar Power Co., Ltd.,

839 F.3d 1179, 1181 (9th Cir. 2016) (en banc) (per curiam).

AFFIRMED.