United States District Court, S.D. Texas, Houston Division
MEMORANDUM OPINION AND ORDER
H. Miller United States District Judge.
before the court is plaintiff Ocusoft, Inc.'s
(“Ocusoft”) motion for a temporary restraining
order and a motion for a preliminary injunction against
defendants Walgreen Co. and Walgreens.com, Inc.
(collectively, “Walgreens”). Dkt. 7. After
considering the motion, response, reply, evidentiary record,
and the applicable law, the court finds that Ocusoft's
motion for a temporary restraining order should be DENIED,
but the court will set a hearing on the motion for a
case involves a dispute between Ocusoft and Walgreens
regarding false advertising. Ocusoft specializes in eye and
skin care products and introduced the first commercially
available eyelid cleanser, Ocusoft Lid Scrub. Dkts. 1, 7.
Walgreens sells the Ocusoft brand in its stores and online.
Dkt. 1. Walgreens also sells its private label eyelid
cleansing pads, (“Walgreens Private Label”) which
are routinely placed next to Ocusoft's products on store
shelves. Dkt. 1 at 6.
April 4, 2017, Ocusoft filed its complaint alleging claims
of: false advertising and unfair competition under the Lanham
Act, federal patent infringement, and unfair competition,
dilution, § 1125(A); 35 U.S.C. § 284. On April 5,
2017, Ocusoft filed its motion for a temporary restraining
order (“TRO”) and preliminary injunction against
Walgreens for false advertising under the Lanham Act. Dkt. 7.
In support of its TRO, Ocusoft alleges (1) that store clerks
at three Walgreens stores in Texas made false representations
that the Walgreens Private Label and the Ocusoft products
were the same or were made by the same manufacturer, (2) that
one local store in Texas falsely advertised consumer savings
on a compare-and-save label showing a $7 discount, when the
actual savings was $3.50, and (3) that Walgreens's online
advertisements displayed the 2015 Walgreens Rinse-Free Pads,
but customers were shipped the 2016 Walgreens Rinse-Free
Pads, which contains different ingredients. Dkt. 7.
April 24, 2017, Walgreens responded and discussed the actions
it took to address the allegations raised in the TRO. Dkt.
18. Walgreens argues that it “never instructed its
local store employees to inform customers that
Walgreens-branded products are the same as, or are
manufactured by the same company, as Ocusoft eyelid
pads.” Id. at 11. It also argued that these
isolated incidents, including a single incorrect savings tag
in one store were unlikely to influence the purchasing
decisions of consumers. Id. at 20-22. Walgreens
claims it is not aware of any customers other than
Ocusoft's agents who asked whether the products are the
same or were made by the same manufacturer, or of any online
customers who complained about receiving the 2016 version of
the product instead of the 2015 version. Dkt. 18, Ex. A (Duan
Dec.), Ex. B (Fuller Dec.) (stating that less than one
percent of Walgreens' sales of its Private Label eyelid
products are sold online).
Walgreens argues it has corrected the alleged
misrepresentations, including replacing the incorrect
compare-and-save tag, issuing internal communications to all
store managers nationwide to instruct local store employees
to not tell customers that the Ocusoft and Walgreens Private
Label products are the same or are from the same
manufacturer, and removing images of the 2015 Walgreens
Rinse-Free Pads from its website. Dkt. 18 at 11-12, Exs. A,
1, 2017, Ocusoft filed its reply and argued that a TRO is
still necessary because at least one Walgreens store in
Florida displayed an incorrect compare-and-save tag and an
employee who was questioned about the Walgreens Private Label
and Ocusoft products said that they were the same. Dkt. 25,
Ex. A (Bernard Dec.).
seeking a temporary restraining order or a preliminary
injunction pursuant to Rule 65 of the Federal Rules of Civil
Procedure must demonstrate four elements: (1) a substantial
likelihood of success on the merits; (2) a substantial threat
of irreparable injury if the injunction is denied; (3) that
the threatened injury outweighs any prejudice the injunction
might cause the defendant; and (4) that the injunction will
not disserve the public interest. Bluefield Water
Ass'n, Inc. v. City of Starkville, Miss., 577 F.3d
250, 252-53 (5th Cir. 2009); Affiliated Prof'l Home
Health Care Agency v. Shalala, 164 F.3d 282, 285 (5th
Cir. 1999). Injunctive relief, particularly at the
preliminary stages of litigation, is an extraordinary remedy
that requires an unequivocal showing of the need for the
relief to issue. Valley v. Rapides Parish Sch. Bd.,
118 F.3d 1047, 1050 (5th Cir. 1997). Thus, injunctive relief
should only be granted where the movant has “clearly
carried the burden of persuasion.” Bluefield Water
Ass'n, 577 F.3d at 252-53; Anderson v.
Jackson, 556 F.3d 351, 360 (5th Cir. 2009).
moves for a temporary restraining order to prevent Walgreens
from making false Walgreens responded by listing the actions
it took to correct any inaccuracies in its online and
in-store advertisements and argues that Ocusoft is not
entitled to injunctive relief. Dkt. 18. Injunctive relief is
an extraordinary remedy, and the court finds that Ocusoft has
not carried its burden of persuasion with regard to proving
the element of irreparable injury required for injunctive
relief. Bluefield Water, 577 F.3d at 252-53.
argues it is entitled to a presumption of irreparable harm.
Dkt. 7 at 42 (citing Greater Houston Transp. Co. v. Uber
Techs., Inc., 155 F.Supp.3d 670, 703 (S.D. Tex. 2015)
(Gilmore, J.) (“Federal Courts have routinely held that
injury should be presumed when a Lanham Act claim involves
false or misleading comparative advertisements.”).
Ocusoft also cites to cases where courts presume injury after
plaintiffs establish a likelihood of confusion in trademark
infringement cases. Dkt. 25 at 3 (citing T-Mobile US,
Inc. v. AIO Wireless LLC, 991 F.Supp.2d 888, 926 (S.D.
Tex. 2014) (Rosenthal, J.) (“All that must be proven to
establish liability and the need for an injunction against
[trademark] infringement is the likelihood of
confusion-injury is presumed.”) (citing Abraham v.
Alpha Chi Omega, 708 F.3d 614, 627 (5th Cir. 2013)
(holding that a court may issue an injunction against
trademark infringement once a likelihood of confusion is
shown because irreparable injury is then presumed).
argues that the Fifth Circuit has not clearly determined that
claims of false advertisement are entitled to a presumption
of harm. Dkt. 18 at 12 (citing Paulsson Geophysical
Services, Inc. v. Sigmar, 529 F.3d 303, 313 (5th Cir.
2008) (“We have no need to decide whether a court may
presume irreparable injury upon finding a likelihood of
confusion in a trademark case, a difficult question
considering the Supreme Court's opinion in
eBay.”)); see also ADT, LLC v. Capital
Connect, Inc., 1 ...