Opinion
Civil Action No. 3: 03-CV-2954-B.
January 12, 2005
MEMORANDUM ORDER
Before the Court are the following motions: (1) the Motion of the Defendant, Converse, Inc. ("Converse") to Dismiss the claims of the Plaintiffs, Alpha Kappa Alpha Sorority, Inc., Alpha Phi Alpha Fraternity, Inc., Kappa Alpha Psi Fraternity, Omega Psi Phi Fraternity, Inc., Delta Sigma Theta Sorority, Inc., and Phi Beta Sigma, Inc. (collectively "Plaintiffs") pursuant to Federal Rule of Civil Procedure 12(b)(6) and 28 U.S.C. § 1367(c), filed on January 30, 2004. Also before the Court is Converse's Motion filed the same day for Transfer of Venue to the federal court for the District of Massachusetts. For the reasons explained below, the Court GRANTS Converse's Motion to Dismiss and DENIES as moot Converse's Motion to Transfer.
I. Factual and Procedural Background.
The background facts are derived from Plaintiffs' Original Petition and on facts gleaned from the parties' court papers and corresponding attachments. Where there may be a dispute over a stated fact the Court has so indicated by claiming the fact as one stated by that party to be true.
This lawsuit, alleging trademark infringement and dilution and unfair competition, was filed on December 11, 2003 by six Greek-based fraternal organizations, Alpha Kappa Alpha Sorority, Inc., Alpha Phi Alpha Fraternity, Inc., Kappa Alpha Psi Fraternity, Omega Psi Phi Fraternity, Inc., Delta Sigma Theta Sorority, Inc., and Phi Beta Sigma (collectively "Plaintiffs") against Converse, a shoe manufacturer, alleging trademark and trade dress infringement and unfair competition. Collectively, the Plaintiffs' organizations have numerous chapters located at colleges throughout the country and alumni chapters in cities nationally and internationally. (Complaint at 6).
The Plaintiffs assert that the founding years and organizational colors of their organizations identify their organizations, paraphernalia and other apparel. ( Id. at 7). These years and colors allegedly "have acquired significant meaning to the members of [the Plaintiffs'] organizations as well as secondary meaning to the general public." ( Id.). The Plaintiffs contend that they have "used their trade marks and trade dress worldwide in connection with the manufacture, sale and licensing of Greek paraphernalia, including apparel, shoe wear, and other products." ( Id.).
The Plaintiffs allege that Converse infringed their trade marks and trade dress, and also engaged in unfair competition by manufacturing and marketing a line of athletic shoes named the "GREEKPAK Weapon basketball shoe," (the "GREEKPAK") which includes each Plaintiff's colors and founding years, "match[ing] precisely the colors and founding years of Plaintiffs' Greek-based Sororities and Fraternities." ( Id. at 9). Converse allegedly marketed the line with "language such as `no matter your Greek affiliation, grab these for representation.'" ( Id.). The Plaintiffs contend that there is high likelihood of confusion to the public as a result. ( Id. at 11). The Plaintiffs further maintain that "Converse had actual or constructive knowledge of Plaintiffs' rights in and to the marks used by Converse in marketing its GREEKPAK shoes prior to Converse's adoption of the confusingly similar and deceptive marks and trade dress," and that "advertisement of the Plaintiffs' founding colors and years was done in willful and deliberate disregard of Plaintiffs' prior and superior rights with the specific purpose to obtain sales from the members and supporters of Plaintiffs' organizations." ( Id.).
On January 30, 2004, Converse filed (1) a motion to dismiss the Plaintiffs' claims in Counts 1-5 of their Complaint for failure to state a claim under Rule 12(b)(6) and to dismiss Counts 4-7 under 28 U.S.C. § 1367 for lack of subject matter jurisdiction and (2) a motion to transfer venue to the federal district court for the District of Massachusetts. Both motions are presently before the Court.
II. Analysis
A. Motion to Dismiss.
1. Standard for Dismissal Under Rule 12(b)(6).
Motions to dismiss under Rule 12(b)(6) are disfavored and rarely granted. Kaiser Aluminum Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir. 1982). The Court liberally construes the complaint in the plaintiff's favor, and all pleaded facts are taken as true. Campbell v. Wells Fargo Bank, N.A., 781 F.2d 440, 442 (5th Cir. 1986). Unless it appears beyond doubt that the plaintiff cannot prove any set of facts entitling it to relief, the complaint should not be dismissed. Conley v. Gibson, 355 U.S. 42, 45 (1957).
2. Count 1 — Infringement of Federally Registered Marks Under the Lanham Act.
Converse first moves to dismiss the Plaintiffs' claims against it in Count 1 of the Complaint, in which the Plaintiffs allege that Converse has infringed on their federally registered marks in violation of the Lanham Act. (Complaint at 12; Motion to Dismiss at 3). Converse asserts that, in order to bring such a claim, the Plaintiffs must plead the infringement of a federally registered trademark, and must have "`achieved the status of registrant.'" (Motion to Dismiss at 3; 15 U.S.C. § 1114(1); Nikas v. Vietnam Veterans of Am., Inc., 1992 WL 336495, at *4 (D.D.C. Nov. 6, 1992) (citations omitted); Basile, S.p.A. v. Basile, 899 F.2d 35, 37 n. 1. (D.C. Cir. 1990) (holding that a plaintiff must qualify as a registrant to be protected under the Lanham Act). The Court agrees. Specifically, none of Alpha Kappa Alpha Sorority, Inc., Kappa Alpha Psi Fraternity, Inc., Omega Psi Phi Fraternity, Inc., or Delta Sigma Theta Sorority, Inc., has identified any valid U.S. trademark registration. Thus, these Plaintiffs' claims in Count 1 must be dismissed. See, e.g., Basile, S.p.A., 899 F.2d at 37 n. 1.
The Court notes that although the Plaintiffs assert in their Response that Phi Beta Sigma Fraternity, Inc. has filed an application to obtain federal trademark registration (Response at 15), it will not become a "registrant" under the statute until such registration is obtained. 15 U.S.C. § 1114 ("Any person who shall, without the consent of the registrant — use in commerce any reproduction, . . . copy or colorable imitation of a registered mark . . . shall be liable to the registrant for remedies hereinafter provided.") (emphasis added).
Regarding the other two Plaintiffs, who have each alleged ownership of two separate trademarks, Converse claims that these Plaintiffs' allegations are insufficient to state a claim because the sole mention of the trademark registrations in the Complaint is located in paragraph 21, which states, "For instance, Plaintiff Alpha Phi Alpha is the owner of Registration Nos. 1,459,737 and Phi Beta Sigma is the owner of Registration No. 1,821,210." The Plaintiffs fail, however, to allege infringement of these specific registrations. (Complaint ¶ 21; see also generally Complaint; Motion to Dismiss at 4).
Converse has attached these registrations as Exhibits "A"-"C" to its Motion to Dismiss, and contends that there is no similarity between these three registrations, each crests or symbols of the organizations, and the allegations in the Complaint, which address Converse's use of certain color combinations and founding years on their shoes. (Motion to Dismiss, Exhibits "A"-"C"). Additionally, the registration cited by Phi Beta Sigma has been canceled, requiring dismissal of Phi Beta Sigma's claim for statutory infringement in Count 1. (Def. App. at 5; Response at 15). Loctite Corp v. Nat'l Starch and Chem. Corp., 516 F. Supp. 190, 214 (S.D.N.Y. 1981) (ordering the plaintiffs' registration cancelled and finding that the plaintiffs therefore had "no basis for a statutory claim of trademark infringement.") .
The Court may review the documents attached as Converse's exhibits "A"-"C" to Converse's Motion to Dismiss because they contradict assertions made in the Complaint, and the Plaintiffs failed to attach the relevant documents when filing their Complaint. See, e.g., Sheppard v. Tex. Dept. of Transp., 158 F.R.D. 592, 595 (E.D. Tex. 1994).
The last remaining Plaintiff to assert a claim in Count 1, Alpha Phi Alpha Sorority, Inc., ("Alpha Phi Alpha") cites two separate registrations in the Complaint, (Def. App. at 1-4). Converse contends, however, that because the registration does not cover the class of goods and services upon which the Plaintiffs claim infringement, this claim fails as well. (Motion to Dismiss at 6-8). Alpha Phi Alpha's first cited registration, number 1459737, comprises a crest and the words "KNOWLEDGE APA ACHIEVEMENT 1906." (Def. App. at 1), and the only "goods and or services" covered by the registration are "Fraternal Organization." ( Id.). The other registration Alpha Phi Alpha cites, number 2227381, comprises the Greek Letters "Alpha," "Phi," and "Alpha" in the particular colors black and "old gold." ( Id. at 1-4). There is no claim regarding the colors, however, apart from these Greek letters. Moreover, none of the Plaintiffs has claimed exclusive rights to use any colors separately from their Greek letters or in any combination, and two of the Plaintiffs have the same color combination. Finally, the mark of the `381 Registration covers jewelry and numerous other items, but does not mention any apparel, including footwear. ( Id. at 3-4). Thus, Alpha Phi Alpha has also failed to state a claim in Count 1 for trademark infringement.
For the reasons explained, the Court finds that the Plaintiffs have merely made the conclusory assertion of trademark infringement in Count 1 of their Complaint and have therefore failed to state a claim for which relief may be granted. The Court therefore GRANTS Converse's motion to dismiss the claims against it in Count 1 of the Plaintiffs' Complaint as to each Plaintiff. See Sheppard, 158 F.R.D. at 595 ("Where a complaint asserts merely conclusory allegations, a court should not accept as true these conclusory statements.") (citing Kaiser Aluminum Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir. 1982)
3. Count 2 — Federal Unfair Competition Claims.
Converse next moves to dismiss the Plaintiffs' claims against it in Count 2 of their Complaint, alleging federal unfair competition claims based on Converse's "use of Plaintiffs' federally registered marks, common law marks, and trade dress." (Complaint § 65; Motion at 8). Each of these claims will be discussed in turn.
a. Use of Federally Registered Marks.
For the reasons discussed above, the Court has found that none of the Plaintiffs has alleged facts which if true would constitute infringement of any identified federally registered trademark by Converse. Thus, the Plaintiffs have likewise failed to state a claim for unfair competition based on the use of federally registered marks.
b. Use of Common Law Trademarks.
In addition to the Plaintiffs' claims of unfair competition by use of federal trademarks, the Plaintiffs allege that Converse has unlawfully used their common law trademarks in violation of 15 U.S.C. § 1125(a). Aside from this conclusory allegation, however, the Plaintiffs fail to identify any of those common law trademarks. Instead, the Plaintiffs merely describe how each organization has a color combination and founding year associated with it and how these same color combinations and years appear on Converse's GREEKPAK shoes, but they do not claim that the color and year combinations are trademarks. Under the Lanham Act, a Plaintiff is required to identify the specific elements comprising its trademark. Landscape Forms, Inc., 113 F.3d 373, 381 (2nd Cir. 1997). The Plaintiffs dispute their obligation to allege facts identifying these elements in their Response ( see, e.g., Response at 5-6), and they fail to fill in any of the factual details lacking in their Complaint in their Response to Converse's Motion to Dismiss.
Finally, the Plaintiffs fail to allege that they have ever used these color and year combinations on any product, a prerequisite for common law ownership of a trademark. See Blue Bell, Inc. v. Farah Mfg., Co., 508 F.2d 1260, 1267 (5th Cir. 1975) ("Mere adoption of a mark without bona fide use, in an attempt to reserve it for the future, will not create trademark rights.") (citations omitted). For these reasons, the Court finds that the Plaintiffs have failed to state a claim for infringement of any common law trademarks.
c. Trade Dress Infringement.
The Plaintiffs' third claim against Converse in Count 2 is for use of the Plaintiffs' trade dress. Trade dress may constitute either product packaging or product configuration. Wal-Mart Stores, 529 U.S. at 213-15. The Plaintiffs failed to allege, however, that they own rights in a particular type of packaging or product configuration. See generally (Complaint). In fact, they do not allege that they have ever used the year and color combinations as trade dress. See ( id.). Nor have the Plaintiffs articulated with particularity, as is required, the elements comprising their trade dress. Landscape Forms, Inc. v. Columbia Cascade Co., 113 F.3d 373, 381 (2d Cir. 1997); see also 1 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition 8:3 (West 2004) (describing the requirement of alleging the particular elements comprising trade dress with specificity).
In Cathey Assoc. v. Beougher, 95 F. Supp.2d 643, 649 (N.D. Tex. 2000), Judge Lindsay of this Court addressed, inter alia, claims of trade dress infringement of unregistered trademarks. The court examined whether the plaintiff in that case had made the requisite showing that (1) its trade dress qualified for protection and (2) that the defendant's use of the trade dress created a "likelihood of confusion in the mind of potential customers." Id. (citing Pebble Beach Co. v. Tour 18 I Ltd., 155 F.3d 526 (5th Cir. 1998) (citations omitted)). The Fifth Circuit in Sunbeam Prod, Inc. v. West Bend Co., 123 F.3d 246, 251 n. 3 (5th Cir. 1997), explained that "[t]rade dress refers to the total image and overall appearance of a product" and "may include features such as the size, shape, color, color combinations, textures, graphics, and even sales techniques that characterize a particular product." Thus, a court analyzing a trade dress claim focuses on "whether a combination of the features creates a distinctive visual impression identifying a source of the product." Id. at 251; Cathey Assoc., 95 F. Supp.2d at 649.
The Plaintiffs have failed to identify a form of product as to which their alleged trade dress — the color and founding year combination — applies. No Plaintiff has alleged that there is any footwear belonging to any of them bearing the alleged color and year combination, nor has any Plaintiff identified the particular shoe that constitutes the trade dress, and the Court thus GRANTS Converse's motion to dismiss the Plaintiffs' claims against it in Count 2 for failure to state a claim.
4. Count 3 — Violation of the Lanham Act — Anti-Dilution.
Converse next moves to dismiss the Plaintiffs' claims against it in Count 3 of their Complaint for violating the Lanham Act, 15 U.S.C. § 1125(c), by diluting "the distinctive quality of the mark" of each of the Plaintiffs in its "unauthorized and unlicensed use of Plaintiffs' marks after the marks have become famous." (Complaint at 15; Motion to Dismiss at 13). Such a claim requires identification of a trademark and/or trade dress in which a plaintiff owns rights and which Converse has allegedly used, and the allegations in this Count thus fail to state a claim because, as discussed in Sections 2 and 3, supra, the Plaintiffs' Complaint fails to identify any trademarks or trade dress that any of the Plaintiffs own or have used that have also been used by Converse. See generally (Complaint; Motion to Dismiss at 13-14). The Court therefore GRANTS Converse's motion to dismiss the Plaintiffs' claims against Converse in Count 3 of their Complaint for violation of the antidilution provisions of the Lanham Act.
5. Counts 4-7 — State Law Causes of Action.
Finally, Converse moves for dismissal of the state law claims against it in Counts 4-7 of the Plaintiffs' Complaint, for injury to trade name and dilution under section 16.29 of the Texas Business and Commerce Code (Count 4), Texas common law unfair competition and trademark infringement (Count 5), Texas statutory deceptive trade practices (Count 6), and attorneys' fees (Count 7). Converse moves to dismiss these remaining claims for lack of subject matter jurisdiction because the federal claims which gave the Court supplemental jurisdiction over them have all been dismissed.
The Court has dismissed all of the Plaintiffs' federal claims against Converse. Only the state law claims remain, and they each rely on the existence of an identifiable mark. Moreover, there has been no scheduling order issued in the case, pending the resolution of the present motions, and thus the parties have not yet begun discovery. In sum, the Court finds that the balance of the factors to be considered, including judicial economy, convenience, fairness or the existence of important federal policies, weighs in favor of declining jurisdiction in this case, where all federal law claims have been dismissed. Rahr v. Grant Thornton LP, 142 F. Supp. 2d 793, 801 (N.D. Tex. 2000); Parker Parsley Petroleum v. Dresser Indus., 972 F.2d 580, 590 (5th Cir. 1992) (holding that the district court abused its discretion by retaining jurisdiction over state law claims following dismissal of all federal claims). The Court therefore GRANTS Converse's motion for dismissal of the state law claims against it in Counts 4-7 of the Plaintiffs' Complaint and DISMISSES those claims for lack of subject matter jurisdiction.
III. Conclusion
For the reasons set forth in this order, it is ORDERED that Converse's Motion to Dismiss the Plaintiffs' claims against it is GRANTED. Converse's Motion to Transfer is DENIED as moot.SO ORDERED.