IP Law Daily, TRADEMARK—C.D. Cal.: Maker of 'pur pom' pomegranate-flavored beverages infringed POM Wonderful mark, (Jun 30, 2016)

By Cheryl Beise, J.D.

The seller of a pomegranate-flavored beverage under a brand name using a variation of the word "pom" infringed Pomegranate juice maker Pom Wonderful LLC’s POM marks, the federal district court in Los Angeles has decided. The court rejected all defenses and counterclaims asserted by defendants Robert G. Hubbard d/b/a Pur Beverages, LLC ("Pur"). In a separate order, the court dismissed the defendants’ Sherman Act and RICO counterclaims (POM Wonderful LLC v. Hubbard, June 29, 2015, Williams, S.).

On September 19, 2013, POM Wonderful LLC and the Wonderful Company LLC (collectively, "Pom" or "Pom Wonderful") filed suit against Robert G. Hubbard d/b/a Pur Beverages, LLC ("Pur") and Portland Bottling Company (collectively, "defendants") alleging trademark and unfair competition claims. Pom Wonderful’s second amended complaint alleged: trademark infringement, false designation of origin, and statutory and common law unfair competition.

The defendants also asserted counterclaims for declaratory judgment of non-infringement; cancellation of Pom’s trademark registration on the grounds of abandonment, genericness, and fraud; violation of Section 2 of the Sherman Act; and violation of RICO violations of 18 U.S.C. §§ 1961 et seq. (RICO). The defendants asserted several defenses to Pom’s claims, including fair use, trademark abandonment, and fraud on the USPTO.

On January 17, 2014, the court denied Pom Wonderful’s motion for preliminary injunction. Pom Wonderful appealed the denial of preliminary injunction. On December 30, 2014, the Ninth Circuit reversed the denial of preliminary injunction and remanded for further proceedings. On August 6, 2015, the court again denied Pom Wonderful’s motion for preliminary injunction.

On May 2, 2016, defendant Hubbard filed an amended counterclaim, adding Pom Wonderful LLC’s owners, Stewart and Lynda Resnick, as counter-defendants.

The court issued two separate opinions, deciding all issues in favor of the plaintiffs. In the trademark order, the court granted summary judgment in favor of Pom Wonderful on its trademark infringement claim, as well as defendant’s counterclaims for fraud, abandonment, and genericness. In the antitrust order, the court dismissed Pur’s antitrust and RICO counterclaims.

Abandonment. Pur sought cancellation of Pom Wonderful’s registration for its mark POM, in standard characters, issued October 15, 2002, on the basis of abandonment. Pur argued that since 2002, Pom had not used its standard character mark, but exclusively has used a stylized version of POM, in which the "O" is in the shape of a heart. Pom obtained registration of its stylized mark on January 24, 2006.

A standard character drawing is not limited to a particular stylization or depiction, it affords the registrant "a broader scope of coverage," the court explained. In determining whether a design exceeds the permissible use of a standard character mark, the USPTO applies the "distinct commercial impression" test. The heart-shaped "O" did not create a distinct commercial impression separate and apart from "POM," according to the court. The stylized lettering does not alter the pronunciation or perception of the word; the standard character mark was both aurally and visually indistinguishable from the mark bearing the heart-shaped "O." The court also rejected Pur’s argument that Pom forfeited the broad rights conferred by its "POM" standard character mark when it registered the stylized heart-shaped "O" mark as a separate design mark.

Pur additionally argued that because the heart shape was not found in the standard character set published by the USPTO, it could be used as part of a standard character mark. This argument was without merit. The standard character set is simply an administrative tool to assist USPTO examining attorneys when inspecting a submitted drawing, not a specimen of use, the court explained. Thus, it does not dictate the manner in which a standard character mark may be depicted on a product as used in commerce. Pur failed to create a triable issue of fact on the question of abandonment.

Genericness. Pur argued that the trademark "POM" had become a generic, shorthand term for "pomegranate." Pur relied on a Pom advertisement from 2002 stating, "The POM stands for pomegranate." Pur also produced a Google search results list of purported third-party use, but it was impossible to determine whether the term "pom" was being used as a proxy for "pomegranate" or whether it was being used as a descriptive term used to designate the pomegranate flavor of a product, the court noted. Pur also provided a list of 32 trademark applications containing the term "pom," without providing any explanation as to the manner of use. A cursory inspection of the list revealed that some of the "pom" uses made absolutely no reference to pomegranate. Pur failed to create a triable issue of fact on the question of genericness.

Fraud. Pur acknowledged that it did not have any evidence of fraud, but it requested additional time to conduct discovery. The court denied the request. Pur’s allegations of fraud consisted of the legally erroneous position that a standard character mark cannot be depicted with any design elements when used in commerce.

Fair use defense. Pur argued that its use of "pom" merely described the pomegranate flavor of its product, thereby falling within the classic fair use doctrine. However, the term "pom" does not possess any inherent meaning or significance, beyond its function as a registered trademark, the court said. And even if the term "pom" were descriptive, the classic fair use defense is not available in cases where a likelihood of customer confusion exists as to the origin of the product. Pur’s classic fair use argument failed as a matter of law.

Trademark infringement. The court found that Pom offered "compelling, undisputed evidence" showing that five of the eight Sleekcraft likelihood of confusion factors weighed heavily in its favor. The remaining three factors did not create a triable issue of fact.

While the mark POM was a suggestive of Pom’s pomegranate-flavored beverages, it was commercially strong, with domestic sales exceeding one-quarter of a billion bottles since 2002. The parties’ single-serving beverage products were similar. Even though Pur’s beverage was carbonated whereas Pom’s consisted of 100% fruit juice, such a negligible difference did not undermine the relatedness of the two products, the court said. The two products cost approximately $2.00 and were sold and marketed in the same channels and geographic markets to ordinary consumers who were not likely to use a high degree of care.

The marks were similar, according to the court. The two marks contained a style variation on the "O"—a heart-shape in the "POM" mark and a diacritical notation in the "pom" mark. The letters in both marks appeared in uniform casing, as the "POM" mark was displayed in all capital letters while the "pom" mark appeared in all lower case. Both marks also used white lettering with a maroon background. The most significant difference was that the POM mark appeared in large font while the "pom” mark appeared in smaller font below the name “pur.” Furthermore, the marks were semantically identical, as each referred to the pomegranate flavoring of the beverage. There was no triable issue of fact as to the similarity of the marks.

The court rejected all of Pur’s defenses and granted summary judgment in favor of Pom on its trademark infringement claim. Pur’s counterclaim for declaratory judgment of non-infringement, abandonment, fraud on the USPTO, and genericness were moot.

Sherman Act and RICO counterclaims. The court granted the plaintiff’s motion to dismiss the antitrust and RICO counterclaims. In support of both claims, Hubbard alleged that Pom Wonderful, Resnicks, and their attorneys all conspired to perpetrate a monopolistic scheme by registering the POM standard character mark without any intent to use the mark and for the sole purpose of preventing others in the market from using the term "pom" to describe the contents or flavor of pomegranate-related products.

The court’s summary judgment ruling rejected the argument that Pom Wonderful failed to make any use of its "POM" standard character mark. Hubbard’s unsupported allegations that Pom obtained its mark by fraud and intentionally refused to use it in an underhanded attempt to squelch competition were likewise rejected.

The case is No. 2:13-cv-06917-RGK-JPR.

Attorneys: Michael M. Vasseghi (Roll Law Group PC) and Douglas N. Masters (Loeb and Loeb LLP) for POM Wonderful LLC and The Wonderful Co. LLC. Robert G. Hubbard, pro se, for Robert G. Hubbard d/b/a Pur Beverages and Northwest Beverage Distributors.

Companies: POM Wonderful LLC; The Wonderful Co. LLC

Cases: Trademark CaliforniaNews