IP Law Daily, TRADEMARK—W.D. Wash.: Monster Energy denied default judgment in suit against ‘Monster Dollar’ store, (Apr 26, 2023)

By Ursula Furi-Perry, J.D., MBA

The court could not adequately address whether Monster successfully pleaded a likelihood of confusion, as it made no attempt to establish the goods/services the retail store sold or advertised.

In a suit brought by energy drinks company Monster Energy, asserting trade dress infringement, trademark infringement, and related claims, the federal district court in Seattle has declined to issue a default judgment against the operator of a Washington retail store named “Monster Dollar.” The court held that Monster failed to adequately plead a claim for trademark infringement. Specifically, the court could not adequately address whether Monster successfully pleaded a likelihood of confusion based on the DuPont and Sleekcraft factors, because Monster made no attempt to establish the types of goods or services that the retail store actually sells or advertises (Monster Energy Co. v. Pelmir Enterprise Inc., April 25, 2023, King, L.).

Monster Energy Co. sued Pelmir Enterprise, Inc., which owns and operates a retail store under the name “Monster Dollar” in Kent, Washington. Pelmir’s store sign contains the words “Monster Dollar” in large, green, standard font against a white background, along with a green triangle, inside of which are two red arrows and an infinity symbol and the store’s website address in small, red font. Monster Energy owns registered marks that it uses on its beverages and on other products, such as clothing, accessories, and sports gear. The company notes that it has consistently used a distinctive trade dress for its products, packaging, and promotional materials since 2002, having spent over $9.8 billion dollars in advertising, promoting, and marketing its brand.

Monster asserted claims for trade dress infringement, trademark infringement, and false designation of origin under the Lanham Act and state law unfair competition claims. After being served with process, Pelmir failed to respond to Monster’s lawsuit or appear in court. Monster filed a motion for default judgment, along with a request for attorney fees and a request for a permanent injunction against Pelmir’s use of any of the company’s trademarks or trade dress.

The court reviewed Monster’s motion for default judgment under Rule 55 of the Federal Rules of Civil Procedure. It did so under the Eitel standard, which allows the court to look at the following factors: (1) the possibility of prejudice to the plaintiff, (2) the merits of plaintiff's substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in the action, (5) the possibility of a dispute concerning material facts, (6) whether the default was due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits.

The district court focused largely on the merits of Monster’s substantive claims and the sufficiency of the company’s complaint, as it noted that those two factors alone would justify denying Monster’s motion. For each cause of action asserted by Monster, the court reviewed the standards for stating plausible claims for relief to determine whether Monster’s allegations were sufficient.

The court held that Monster failed to adequately plead a claim for trademark infringement, and the court could not adequately address whether Monster successfully pleaded a likelihood of confusion based on the DuPont and Sleekcraft factors because Monster made no attempt to establish the types of goods or services that Pelmir actually sells or advertises. Though unable to assess the likelihood of confusion factors, the court also noted its skepticism that consumers would be confused by the two marks, even if certain of those factors were satisfied, as the two marks only shared the word “monster,” which would likely not assume a connection between the parties when encountering the marks in the marketplace.

Because Monster failed to establish a likelihood of confusion, the federal district court held that its additional claims for trade dress infringement, false designation of origin, and unfair competition were also not established, and the company’s complaint fell short of the standard.

The case is No. 2:22-cv-00524-LK.

Attorneys: Jacob Rosenbaum (Knobbe Martens Olson & Bear LLP) for Monster Energy Co.

Companies: Monster Energy Co.; Pelmir Enterprise Inc. d/b/a Monster Dollar

Cases: Trademark WashingtonNews