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TailGate Beer, LLC v. Boulevard Brewing Co.

United States District Court, M.D. Tennessee, Nashville Division

October 16, 2019

TAILGATE BEER, LLC, Plaintiff,
v.
BOULEVARD BREWING COMPANY, Defendant.

          MEMORANDUM OPINION

          ELI RICHARDSON UNITED STATES DISTRICT JUDGE

         Pending before the Court is Plaintiff Tailgate Beer, LLC (“TailGate”)'s Motion for Preliminary Injunction (the “Motion”), filed on June 19, 2018. (Doc. No. 3). Defendant Boulevard Brewing Company (“Boulevard”) responded (Doc. No. 41), and Tailgate replied. (Doc. No. 47). TailGate also filed a supplemental brief in support of its Motion. (Doc. No. 88). The Court held a hearing on the Motion on September 20, 2019, and the Court permitted additional post-hearing briefing on any matters not addressed during the hearing. (Doc. Nos. 113, 114). For the reasons discussed below, TailGate's Motion for Preliminary Injunction with be denied.

         BACKGROUND[1]

         a. Factual History[2]

         Tail Gate is a local Nashville brewery and distributor of small batch craft beer. (Doc. No. 4 at 1). TailGate originally opened as a brewery and beer distributor in San Diego, California in 2007. (Id. at 2). In 2014, TailGate moved its operation to Nashville, Tennessee. (Doc. No. 4 at 6). In 2016, TailGate opened a second taproom in Nashville, Tennessee. (Id.). Currently, TailGate operates three locations in the Nashville area. At this time, except for limited sales in the United Kingdom and Sweden, TailGate does not sell or distribute its beer outside of Tennessee. (Doc. No. 41 at 7).

         On March 5, 2013, the U.S. Patent and Trademark Office ("USPTO") issued TailGate U.S. Trademark Registration No. 4298625 for its TailGate Logo (the "TailGate Mark"):

         (Image Omitted)

         (Doc. No. 4-1, Ex. A). The TailGate Mark features a pickup truck parked at a particular angle, featuring, among other things, a lowered tailgate and a beer keg in the bed of the truck. (Doc. No. 4-1, Ex. D). When marketing specific beers, TailGate often imposes other images into the bed of the truck. (Id.). For example, at the Preliminary Injunction Hearing, Wesley Keegan, TailGate's founder and owner, testified that a can of TailGate's Peanut Butter Milk Stout displays in the truck bed a cow with its hoof in a jar of peanut butter. The TailGate Mark is printed on various items including, but not limited to, TailGate's beer cans, taps, glassware, and merchandise available for sale on TailGate's online store. (Id.). The TailGate Mark is also displayed on the TailGate website and used in promotions, marketing, and advertising. (Doc. No. 1-4).

         In 2013, the USPTO issued TailGate U.S. Trademark Registration No. 4280254 for the stylized mark "TailGate Beer" (the "TailGate Wordmark"):

         (Image Omitted)

         (Doc. No. 4-1, Ex. B).

         In addition, in 2010, TailGate obtained U.S. Copyright Registration No. VA0001751100 for the work it calls the TailGate Beer Logo ("Copyrighted TailGate Logo"):

         (Image Omitted)

         (Doc. No. 4-1, Exhibit C). The Copyrighted TailGate Logo appears to be a colored version of the TailGate Mark. TailGate also obtained U.S. Copyright Registration No. TXU001734540 for certain text, artwork, and photographs appearing on the TailGate Beer Website. (Id.).

         Boulevard was founded in 1989 and is a beer distributor and brewery that sells craft beer. (Doc. No. 4 at 7). Relatively recently, Boulevard rebranded its Pale Ale Beer and replaced the label with a new label featuring the image with which Tailgate takes issue here (the "Pale Ale Image"):

         (Image Omitted)

         (Doc. No. 4 at 4). The Pale Ale Image is owned by IPack S.A.R.L. ("IPack"), a company related to Boulevard.

         TailGate also takes issue with Boulevard's "Palegate" advertising campaign (the "Palegate Advertisement"):

         (Image Omitted)

         (Doc. No. 4 at 9). The Palegate Advertisement promoted a sweepstakes awarding tickets to a Kansas City Royals home baseball game and was directed only to residents of Missouri, Kansas, Iowa, and Nebraska (Doc. No. 41 at 17).

         Although Boulevard sells its beer in Tennessee, including in 47 locations within 10 miles of TailGate's original taproom and 74 locations within 10 miles of TailGate's second location (Doc. No. 4 at 7), Boulevard does not sell its Pale Ale in Tennessee (Doc. No. 41 at 8).

         TailGate became aware of the Pale Ale Image through a customer who, during a trip to Kansas City, saw the Pale Ale Image and believed it to be the TailGate Mark. (Doc. No. 4-1, Ex. D). When TailGate discovered the Pale Ale Image, TailGate contacted Boulevard and demanded that Boulevard stop using the image, which they deemed to be “unmistakably similar to the [TailGate] Mark.” (Doc. No. 4 at 4). On March 12, 2018, IPack filed a petition with the USPTO to cancel TailGate's trademark, alleging the trademark has been abandoned (the “Cancellation Proceeding”). (Doc. 97-4 at 2). That petition is currently pending before the Trademark Trial and Appeal Board (“TTAB”). Also before the TTAB is a proceeding filed by TailGate opposing IPack's application for the registration of the Pale Ale Image (“Opposition Proceeding”). The TTAB issued an order staying both proceedings pending final disposition of this action. (Doc. No. 97-7).

         b. Procedural History

         On June 19, 2018, Trademark filed its Complaint, setting forth the claims described below. (Doc. No. 1). That same day, it also filed a Motion for Preliminary Injunction. (Doc. No. 3). Boulevard responded to the Motion on September 19, 2018. (Doc. No. 41). TailGate replied to Boulevard's response on September 26, 2018. (Doc. No. 47). On June 5, 2019, a hearing on Plaintiff's Motion for Preliminary Injunction was scheduled for August 23, 2019. (Doc. No. 77). On June 19, 2019, the parties filed a joint motion to continue the Preliminary Injunction Hearing due to previously scheduled and unmovable commitments for Boulevard. (Doc. No. 78). On August 16, 2019, the Hearing was rescheduled to September 20, 2019. (Doc. No. 16).

         The Preliminary Injunction Hearing was held, and concluded, on September 20, 2019 as scheduled. During the Hearing, the parties informed the Court that within a few weeks thereafter they would submit possible trial dates. The Parties suggested that they would likely propose a date roughly nine months from the date of the Hearing. They later proposed to the Court a target trial date no earlier than roughly nine and a half months from the date of this Memorandum Opinion. (Doc. No. 116 at 8).

         LEGAL STANDARD

         The Sixth Circuit has held that the district court must balance four factors when considering a motion for preliminary injunction under Federal Rule of Civil Procedure 65: (1) whether the movant has a strong likelihood of success on the merits; (2) whether the movant would suffer irreparable injury without the injunction; (3) whether the issuance of the injunction would cause substantial harm to the opposing party or others; and (4) whether the public interest would be served by the issuance of the injunction. Bays v. City of Fairborn, 668 F.3d 814, 818-19 (6th Cir. 2012). “The party seeking a preliminary injunction bears a burden of justifying such relief, including showing irreparable harm and likelihood of success.” Kentucky v. U.S. ex rel. Hagel, 759 F.3d 588, 600 (6th Cir. 2014) (quoting Michigan Catholic Conf. & Catholic Family Servs. v. Burwell, 755 F.3d 372, 382 (6th Cir. 2014)). “No single factor is a prerequisite to the issuance of a preliminary injunction; rather the Court must balance all four factors.” Young v. Giles Cnty. Bd. of Edu., 181 F.Supp.3d 459, 463 (M.D. Tenn. 2015) (citing Neveux v. Webcraft Tech., Inc., 921 F.Supp. 1568, 1570-71 (E.D. Mich. 1996)). However, a plaintiff must always demonstrate an irreparable injury before a preliminary injunction may issue. Id. (citing Neveux, 921 F.Supp.3d at 1571).[3]

         ANALYSIS

         In its Complaint, TailGate claims that Boulevard's use of the Pale Ale Image on the label of its pale ale craft beer and in the Palegate Advertisement violates federal and common law. Specifically, TailGate asserts federal claims for trademark infringement, 15 U.S.C. § 1141, false designation of origin, 15 U.S.C. § 1125(a), and copyright infringement, 17 U.S.C. §§ 106 et seq., 501, and common law claims for trademark infringement and false designation of origin. (Doc. No. 1).

         At this juncture, the Court is not deciding the ultimate merits of TailGate's case against Boulevard. Rather, the Court is called upon to determine whether TailGate has presented evidence sufficient to show that a preliminary injunction is warranted at this time. As discussed below, the Courts answers that question in the negative; TailGate has failed to show that the extraordinary remedy of a preliminary injunction is warranted in this case. TailGate's evidentiary showing and argument collectively fall short on two critical factors: (1) strong likelihood of success on the merits and (2) irreparable harm.

         1. Likelihood of Success on the Merits

         A. Trademark Infringement

         Under the Lanham Act, trademark infringement occurs when “any person...without the consent of the registrant[, ] use[s] in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive[.]” 15 U.S.C. § 1114(1). “To state a claim for trademark infringement under the Lanham Act, a plaintiff must allege facts establishing that: (1) it owns the registered trademark; (2) the defendant used the [allegedly infringing] mark in commerce; and (3) the use was likely to cause confusion.” Hensley Mfg. v. ProPride, Inc., 579 F.3d 603, 609 (6th Cir. 2009) (citing 15 U.S.C. § 1114(1)). The second element is not at issue here since the parties do not dispute that Boulevard used the allegedly infringing mark in commerce.

         TailGate claims that it has established the first element-that it owns the trademark- because the TailGate Mark is registered to TailGate by the USPTO, bearing registration number 4298625. (Doc. No. 4 at 14; Doc. No. 114 at 2). Boulevard disagrees, arguing that this element is not satisfied because TailGate's trademark is not valid. (Doc. No. 41 at 3). According to Boulevard, the TailGate Mark is not valid because TailGate has abandoned the federal registration and because this trademark has not been and is not currently used in interstate commerce. (Id. at 3-9). Under the Trademark Manual of Examining Procedure, “[i]f a mark has not been in use for three consecutive years and the holder has done nothing to try to resume use of the mark, the USPTO may presume that the holder has abandoned the mark.” TMEP § 1613.11 (quoting 15 U.S.C. § 1127). The validity of TailGate's trademark due to abandonment and use in interstate commerce is at issue in the proceedings before the TTAB, which, as discussed above, are currently stayed pending final disposition of this action. (Doc. No. 97-7). TailGate argues that the issues before the TTAB are irrelevant to the proceedings before this Court. (Doc. No. 47 at 4). Although the Court believes that the abandonment and cancellation issues are relevant to whether TailGate owns the registered trademark, because the Court finds that there is no likelihood of confusion, it need not address the abandonment and cancellation issues at this time.

         As for the third element, TailGate asserts that it is likely to succeed on the merits because Boulevard's use of the Pale Ale Image is likely to cause confusion with TailGate's federally registered trademark. The Sixth Circuit has developed an eight-factor test to evaluate, based on the circumstances of each case, whether confusion is likely. Frisch's Rests., Inc. v. Elby's Big Boy of Steubenville, Inc., 670 F.2d 642, 648 (6th Cir. 1982). The eight factors this Court considers are: “(1) strength of the plaintiff's mark; (2) relatedness of the goods; (3) similarity of the marks; (4) evidence of actual confusion; (5) marketing channels used; (6) likely degree of purchaser care; (7) defendant's intent in selecting the mark; [and] (8) likelihood of expansion of the product lines.” Id. Although all relevant factors must be considered, ...


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