IP Law Daily, TRADEMARK—W.D. Mich.: Maker of ‘BREEZE’-branded vape products gets preliminary injunction against ‘BREEZY BAR’ sellers, (Apr 26, 2023)

By Donielle Tigay Stutland, J.D.

Confusion was likely to occur in the marketplace between the parties’ related products, given the similarity of the trademarks.

After finding that a likelihood of confusion exists, a federal district court in Michigan has granted a preliminary injunction to Breeze Smoke, LLC, a maker of vaping products and holder of several trademarks with the word “BREEZE,” against several wholesale and retail sellers of a vaping product named BREEZY BAR. Weighing the relevant factors, the court found that confusion is likely to occur in the marketplace, meaning that there was a substantial likelihood of success on the claims under the Lanham Act. The court denied in part and granted in part a motion for judgment on the pleadings brought by the defendants. The court did not dismiss claims under the Lanham Act, but did dismiss claims brought under the Michigan Consumer Protection Act (MCPA) alleging consumer confusion. Because the products are regulated by the Food and Drug Administration, they fall under an exemption to the MCPA’s coverage, the court explained (Breeze Smoke LLC v. Yatin Enterprises Inc., April 25, 2023, Jarbou, H.).

Breeze Smoke LLC manufactures and sells vaping products, including disposable electronic vaping devices. The defendants are various wholesalers and retail sellers of such products in the state of Michigan. Breeze Smoke discovered that the various sellers and wholesalers were also selling a vaping product called “BREEZY BAR,” and filed suit under the Lanham Act for federal trademark infringement and a claim under the MCPA for consumer confusion. The trademark holder also sought a preliminary injunction.

Protectable/enforceable mark. Breeze Smoke currently possesses federal registrations for BREEZE PLUS and BREEZE SMOKE, and uses various unregistered marks on its vaping products that contain the word “breeze,” including BREEZE PRO. Additionally, Breeze Smoke has several registrations in Michigan for its marks. The alleged infringers argued that the marks are not protectable or enforceable for several reasons. First, it was argued that the mark cannot be protectable or enforceable here because the Breeze Smoke products cannot lawfully be used in commerce, the trademarks have been assigned, and the trademarks are the subject of cancellation proceedings with the Trademark Trial and Appeal Board.

Unlawful use doctrine. The alleged infringer argued that the marks are not enforceable or protectable under the unlawful use doctrine. This argument centered around the fact that Breeze Smoke had applied for FDA approval of its devices and the FDA had denied its application. According to the sellers, “without such authorization, those products are considered 'misbranded' under the Federal Food, Drug, and Cosmetic Act ... and Plaintiff is prohibited from introducing or delivering them into the marketplace.”

However, the court noted, “the Lanham Act does not expressly require a 'legal’ use in commerce.” Further, the court indicated “the doctrine has no obvious connection to trademark law or to the purposes of the Lanham Act, which protect the trademark holder’s reputation and the goodwill associated with its products.” Additionally, the court pointed out that the sellers had not offered any evidence as to whether the infringing products had sought or received FDA approval. Finally, the court noted that some of Breeze Smoke’s products do not contain nicotine, so they would not be subject to the FDA’s rules.

The retail and wholesale sellers next argued that the marks are not protectable/enforceable because the plaintiff has an improper trademark assignment. The court rejected this argument and found that the sellers had not offered enough evidence as to the facts surrounding the timing of the assignments.

Finally, the retail and wholesalers argued that because the marks are the subject of TTAB cancellation proceedings they are not protectable. Breeze Smoke’s federal trademark registrations are the subject of cancellation proceedings initiated by Promontory Holdings, LLC, which has applied for federal trademark registrations for “BREEZ,” for use in connection with cannabis-themed merchandise, cannabis sprays, and e-cigarettes containing cannabis. The court did not give this argument much weight, finding that it cannot evaluate the likelihood of cancellation “by looking solely at assertions made by a party seeking to cancel some of Plaintiff’s marks.” Additionally, the court indicated that it does not have proof that Promontory Holdings has priority over Breeze Smoke for the marks.

Strength of mark. Next, the court analyzed the Frisch factors for evaluating a likelihood of confusion and turned first to the strength of the marks. The court found this factor to be neutral, based on evidence that the term “breeze” (and variations thereof) is somewhat common in the marketplace for vaping products, which weakens the strength of Plaintiff’s marks.

Relatedness of goods. The court found that the plaintiff’s goods were the same type of goods as the allegedly infringing products that Defendants are selling, i.e., flavored disposable electronic vaping devices and weighed this factor in favor of the plaintiff.

Similarity of marks. The court found the marks “remarkably similar” in overall impression, including the unregistered BREEZE mark for e-cigarettes, as well as its federally registered BREEZE PLUS mark and the recently registered BREEZE SMOKE word mark. The product sold by the sellers is called “Breezy Bar” instead of “Breeze Smoke” or “Breeze Plus,” but the “Breeze” and “Breezy” aspects are the most dominant parts of those marks. The court concluded that the similarity of the marks weighs in Breeze Smoke’s favor.

Evidence of actual confusion. The court found the few instances of confusion offered as evidenced made this factor tilt slightly in favor of Breeze Smoke

Marketing channels. The alleged infringer conceded that the marketing channels were similar.

Degree of purchaser care. Given that vaping products are relatively inexpensive and often disposable, the court found confusion more likely and weighed this factor in favor of the trademark holder.

Intent in selecting mark. The trademark holder argued that the sellers of the products with infringing marks were aware of its trademarks when they sold the allegedly infringing products because they also sell Plaintiff’s products. However, the defendants argued they are simply distributors. The court found this factor was not relevant.

Weighing the relevant factors, the court found that confusion is likely to occur in the marketplace. Therefore, the court determined that the plaintiff has shown a substantial likelihood of success on its claims under the Lanham Act.

Motion on the pleadings. The defendants filed a motion for judgment on the pleadings. With respect to the Lanham Act claims, the alleged infringers argued that the trademark holder fails to state a claim under the Lanham Act because Plaintiff’s products are unlawful under the FDCA. The court noted that it previously declined to adopt the unlawful use doctrine, and the alleged infringers have not adequately explained why any remaining non-nicotine products would be governed by the FDA’s regulations. The court denied the motion with respect to the Lanham Act claims.

Next, the alleged infringers sought dismissal of claims brought under the Michigan Consumer Protection Act (MCPA). They argued that because the products are regulated by the FDA, they fall under an exemption of the MCPA. The MCPA provides that it does not apply to “[a] transaction or conduct specifically authorized under laws administered by a regulatory board or officer acting under statutory authority of this state or the United States.” The court agreed and dismissed the claim brought under the MCPA for customer confusion.

The case is No. 1:22-cv-01182-HYJ-SJB.

Attorneys: Jeffrey Kierstead Lamb (Honigman LLP) for Breeze Smoke LLC. Jacob Carlton (Miller Johnson PLC) for Yatin Enterprises Inc.

Companies: Breeze Smoke LLC; Yatin Enterprises Inc.

Cases: Trademark MichiganNews GCNNews