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Jones v. American Council on Exercise

United States District Court, S.D. Texas, Houston Division

March 29, 2017

Michael Jones, Plaintiff,
v.
American Council on Exercise, Defendant

          MEMORANDUM OPINION AND ORDER

          Gray H. Miller United States District Judge

         Pending before the court is a motion for preliminary injunction filed by plaintiff Michael Jones. Dkt. 22. After considering the motion, response, reply, record evidence, and applicable law, the court is of the opinion that the motion should be DENIED but that this case should be set for trial on an expedited schedule.

         I. Background

         This is a trademark infringement and unfair competition case relating to the term “Medical Exercise Specialist.” Dkt. 5. Plaintiff Michael Jones is the founder of American Academy of Health, Fitness & Rehabilitation Professionals. Dkt. 22, Ex. 1. Jones created a program to train and certify fitness professionals who work with post-rehabilitation patients, and he uses the term “Medical Exercise Specialist” in connection with the certification, course, and exam. Id. He has been using the term since 1994 and claims that he has spent significant time and money advertising this program. Id.

         Defendant American Council on Exercise (“ACE”) is an organization in the health and fitness industry that “equips professionals with the tools they need to help all segments of society experience the innumerable benefits of leading an active lifestyle.” Dkt. 27. It claims to have “rigorous certification and continuing education standards for fitness professionals.” Id. According to ACE, it is a nonprofit organization that generated approximately $20 million in revenue in 2015. Dkt. 27 & Ex. 33 at 9.

         In the late 1990s, Jones became an ACE Continuing Education Course provider, which helped him market the Medical Exercise Specialist course to ACE-certified personal trainers because the course was listed in ACE's catalogues and on its website. Dkt. 22, Ex. 1. However, in the early 2000s, Jones contends that ACE advised him that he could no longer be a continuing education provider because the Medical Exercise Specialist course was a competitor to ACE's Advanced Clinical Exercise Specialist program. Id.

         ACE eventually changed the name of its Advanced Clinical Exercise Specialist program to the Advanced Health and Fitness Specialist program. Dkt. 22, Ex. 4. In 2015, ACE again changed the program name, this time launching the “ACE Medical Exercise Specialist Certification.” Dkt. 22, Ex. 5. ACE documents specifically call this a “name-only change.” Dkt. 22, Ex. 5.

         Jones asserts that ACE cannot use the name “Medical Exercise Specialist” because he (Jones) owns a common-law trademark to the term. Dkt. 22. He initiated this lawsuit to stop ACE from infringing on the mark. Id. Jones also seeks lost profits and other damages for ACE's alleged infringement. Id. ACE filed an answer in which it asserts various defenses including that its use of the term “Medical Exercise Specialist” is “fair use.” Dkt. 18. In the motion at issue in this order, Jones seeks a preliminary injunction prohibiting ACE from using the term “Medical Exercise Specialist.” Dkt. 22. Jones contends that he faces irreparable harm that will destroy his business model if ACE continues using the name. Id. ACE asserts that its use of the name is fair use, that Jones has no rights to the name, and that an injunction would inflict hundreds of thousands of dollars of harm to ACE and run afoul of public policy. Dkt. 34.

         II. Legal Standard

         The decision to grant or deny a motion for preliminary injunction lies within the sound discretion of the district court. Miss. Power & Light Co. v. United Gas Pipe Line Co., 760 F.2d 618, 621 (5th Cir. 1985). “A court should issue a preliminary injunction if the movant shows ‘(1) a substantial likelihood of success on the merits, (2) a substantial threat of irreparable injury if the injunction is not issued, (3) that the threatened injury if the injunction is denied outweighs any harm that will result if the injunction is granted, and (4) that the grant of an injunction will not disserve the public interest.'” Paulsson Geophysical Servs., Inc. v. Sigmar, 529 F.3d 303, 309 (5th Cir. 2008) (quoting Speaks v. Kruse, 445 F.3d 396, 399-400 (5th Cir. 2006) (internal quotations omitted)). “A preliminary injunction is an ‘extraordinary remedy' and should only be granted if the plaintiffs have ‘clearly carried the burden of persuasion on all four requirements.'” Planned Parenthood of Hous. and Se. Tex. v. Sanchez, 403 F.3d 324, 329 (5th Cir. 2005) (quoting Karaha Bodas Co., L.L.C. v. Perusahaan Pertambangan Minyak Dan Gas Bumi Negara, 335 F.3d 357, 363 (5th Cir. 2003) (internal citations omitted)).

         III. Hearing

         Under Federal Rule of Civil Procedure 65(a)(1), as interpreted by the Fifth Circuit, the parties must “have ‘a fair opportunity and meaningful hearing to present their differing versions of . . . facts [that are in dispute] before a preliminary injunction may be granted.'” Anderson v. Jackson, 556 F.3d 351, 360 (5th Cir. 2009) (citing Fed.R.Civ.P. 65(a)(1) and quoting Kaepa, Inc. v. Achilles Corp., 76 F.3d 624, 628 (5th Cir. 1996)). “If the party requesting the injunction cannot show that factual disputes exist regarding the required elements, and cannot introduce evidence sufficient to justify granting the motion, a hearing on the requested injunctive relief is unnecessary.” Id. A district court thus may deny a motion for preliminary injunction without holding a hearing if it does not “rely on any disputed facts in determining whether the injunction should issue.” Id. at 361 (noting that there was “extensive briefing” on the motion and that the district court also held a teleconference). Here, the court finds a hearing is unnecessary because even if it construes all disputed facts in Jones's favor, the court must deny his motion for a preliminary injunction.

         IV. Analysis

         The court will consider all of the preliminary injunction factors in seriatim.

         A. Substantial Likelihood of Success on the Merits

         Jones argues that he meets the heavy burden of showing there is a substantial likelihood of success on the merits because he owns a common-law trademark in the name “Medical Exercise Specialist” and ACE has infringed on that trademark by using the exact same name in the exact same industry. Dkt. 22. ACE argues that there is not a substantial likelihood of success because ACE will prevail on its affirmative defense that its use of the term “Medical Exercise Specialist” is fair use. Dkt. 34. Moreover, ACE asserts that even if the court looked beyond this defense, Jones has no valid rights to the term. Id. ACE contends that the mark is generic and unprotectable. Id. Jones counters that he has evidence proving distinctiveness. Dkt. 35. The court will first discuss the likelihood of success of the fair use defense, and then determine the likelihood of success of Jones's claim that ACE is infringing on its mark.

         1. Fair Use Defense

         To make out the statutory fair use defense, ACE must show that it made use of the term “Medical Exercise Specialist” “(1) other than as a mark, (2) in a descriptive sense, and (3) in good faith.” EMI Catalogue P'ship v. Hill, Holliday, Connors, Cosmopulos Inc., 228 F.3d 56, 64 (2d Cir. 2000); see Soweco, Inc. v. Shell Oil Co., 617 F.2d 1178, 1185 (5th Cir. 1980) (noting that the “fair-use” defense described in 15 U.S.C. § 1115(b)(4) “is available only when the allegedly infringing term is used not as a trademark but ‘fairly and in good faith only to describe to users the goods and services of [a] party, or their geographic origin.'” (quoting 15 U.S.C. § 1115(b)(4)). The defendant does not have an “independent burden to negate the likelihood of any confusion in raising the affirmative defense that a term is used descriptively, not as a mark, fairly, and in good faith.” KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111, 124, 125 S.Ct. 542 (2004). At the preliminary injunction stage, “the copyright owner must demonstrate (after establishing copyright ownership and the taking of original elements), where a prima facie fair use defense is presented, that the fair use factors are insufficient to support such a defense.” Suntrust Bank v. Houghton Mifflin Co., 268 F.3d 1257, 1275 n.31 (11th Cir. 2001).

         The court denied ACE's motion for summary judgment on its fair use defense on October 18, 2016, finding questions of material fact. Dkt. 58. The court notes that a “preliminary injunction may issue . . . despite the existence of a plausible defense, as long as the movant demonstrates a substantial likelihood of success.” Dall. Cowboys Cheerleaders, Inc. v. Scoreboard Posters, Inc., 600 F.2d 1184, 1188 (5th Cir. 1979). However, “the district court must at least make clear that it has considered plausible defenses which are fully briefed and argued by [the] defendants.” Allied Mktg. Grp., Inc. v. CDL Mktg., Inc., 878 F.2d 806, 815 (5th Cir. 1989). “While a preliminary injunction may be appropriate even in the face of potentially significant defenses, it is frequently desirable in such cases to expedite the trial on the merits.” Id. (citing 11 Charles Alan Wright & Arthur R. Miller, Federal Practice & Procedure § 2950, at 484 (1973 & Supp. 1988)). Here, while the defense is plausible, the court finds, for the same reasons it denied the motion for summary judgment on the defense, that the defense does not necessarily preclude the issuance of a preliminary injunction, particularly if the court expedites the trial schedule.

         2. Infringement

         To prevail on a claim of trademark infringement under the Lanham Act, Jones must show: (1) he possesses a legally protectable mark; and (2) ACE's use of his trademark creates a likelihood of confusion as to source, affiliation, or sponsorship. Elvis Presley Enter., Inc. v. Capece, 141 F.3d 188, 193 (5th Cir. 1998). A mark is protectable if it is “distinctive, either inherently or by achieving secondary meaning in the mind of the public.” Am. Rice, Inc. v. Producers Rice Mill, Inc., 518 F.3d at 329. “Marks are often classified in categories of generally increasing distinctiveness; . . . they may be (1) generic; (2) descriptive; (3) suggestive; (4) arbitrary; or (5) fanciful.” Two Pesos v. Taco Cabana, Inc., 505 U.S. 763, 768, 112 S.Ct. 2753 (1992). “A mark need not be registered in order to obtain protection because ‘[o]wnership of trademarks is established by use, not by registration.'” Bd. of Supervisors for La. State Univ. Agric. & Mech. Coll. v. Smack Apparel Co., 550 F.3d 465, 475 (5th Cir. 2008) (quoting Union Nat'l Bank of Tex., Laredo v. Union Nat'l Bank of Tex., Austin, 909 F.2d 839, 842 (5th Cir. 1990)). “The protectability of unregistered marks is governed by the same principles that qualify a mark for registration under the Lanham Act. Id.

         (a) Is the Mark Inherently Distinctive?

         Because the mark is not registered, Jones has the burden of showing it is distinctive. See Am. Rice, 518 F.3d at 329 (the plaintiff bears the burden of showing the mark is protectable). Jones argues that the term “Medical Exercise Specialist” is inherently distinctive because it suggests, but does not describe, his course and certification. Dkt. 22. Marks that are suggestive, arbitrary, or fanciful are considered “inherently distinctive” “because their intrinsic nature serves to identify a particular source of a product.” Two Pesos, 505 U.S. at 768.

Indicia [of a mark's descriptiveness] include: (1) the mark's dictionary definition corresponds with its meaning and context; (2) upon hearing the mark, one need not use “imagination, thought and perception to reach a conclusion as to the nature of goods”; (3) “competitors would be likely to need the terms used in the trademark in describing their products”; and (4) others would have used the term in marketing a similar service or product.

Xtreme Lashes, LLC v. Xtended Beauty, Inc., 576 F.3d 221, 232 (5th Cir. 2009) (quoting Zatarains, Inc. v. Oak Grove Smokehouse, Inc., 698 F.2d 786, 792 (5th Cir. 1983)). Jones claims that no competitor has used his mark for over twenty years, that the mark is not in the dictionary and thus has no ordinary significance to the public, that imagination is required to determine what a Medical Exercise Specialist does, and that there is no evidence of widespread use by others in the industry. Dkt. 22. He also cites evidence in the form of affidavits from individuals who work in the industry that indicates that these individuals perceive the term as being unique to Jones's program, at least until ACE started using the term in 2015. Id. (citing exhibits).

         ACE argues that the mark is generic and thus not protectable. Dkt. 34. ACE contends that “Medical Exercise Specialist” is a “common descriptive (generic) title for specialists in medical exercise.” Id. ACE points to deposition testimony in which Jones indicates that the terms “medical exercise” and “exercise specialist, ” when used separately, are generic terms. Id. (citing Dkt. 27, Ex. A-19). ACE argues that “medical exercise” and “exercise specialist” are common terms of general use and knowledge in the fitness ...


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