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Gorgeous Gals, LLC v. Hey Gorgeous! Spa & Wellness LLC

United States District Court, W.D. Texas, Austin Division

November 2, 2017

GORGEOUS GALS, LLC d/b/a HEY GORGEOUS, Plaintiff,
v.
HEY GORGEOUS! SPA & WELLNESS, LLC, Defendant.

          ORDER

          ROBERT PITMAN, UNITED STATES DISTRICT JUDGE.

         Before the Court are cross-motions for summary judgment filed by Plaintiff Gorgeous Gals, LLC d/b/a Hey Gorgeous, (Dkt. 25), and by Defendant Hey Gorgeous! Spa & Wellness, LLC, (Dkt. 28). Having reviewed the filings, the relevant law, and the factual record, the Court issues the following order.

         I. BACKGROUND

         Since 2012, Plaintiff has offered spa services in Austin, Texas, using its HEY GORGEOUS mark (the “Mark”). (Pl.'s Mot. Summ J., Dkt. 25, at 1). Defendant, since 2013, has offered spa services in San Antonio, Texas, through its business Hey Gorgeous! (Def.'s Mot. Summ. J., Dkt. 28, at 3). The two businesses are approximately 100 miles away from each other. (Id.). Plaintiff has a Texas trademark registration for HEY GORGEOUS under Reg. No. 801764907. (Pl.'s Mot. Summ. J., Dkt. 25, at 5).

         Plaintiff sued Defendant on July 25, 2016, claiming trademark infringement and unfair competition under the Lanham Act, as well as trademark infringement, unfair competition, and unjust enrichment under Texas common law. (Compl., Dkt. 1, at 1). Plaintiff filed its Motion for Summary Judgment on July 18, 2017, (Dkt. 25), and Defendant filed its Motion for Summary Judgment on August 10, 2017, (Dkt. 28).

         II. STANDARD OF REVIEW

         Summary judgment is appropriate under Rule 56 of the Federal Rules of Civil Procedure only “if the movant shows there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A dispute is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 254 (1986).

         The party moving for summary judgment bears the initial burden of “informing the district court of the basis for its motion, and identifying those portions of [the record] which it believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). If the moving party bears the burden of persuasion at trial, it must also “support its motion with credible evidence . . . that would entitle it to a directed verdict if not controverted at trial.” Id. at 331.

         Once the movant carries its initial burden, the burden shifts to the nonmoving party to establish the existence of a genuine issue for trial. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 585-87 (1986); Wise v. E.I. Dupont de Nemours & Co., 58 F.3d 193, 195 (5th Cir. 1995). The non-movant must respond to the motion by presenting evidence indicating there is a genuine issue for trial. Miss. River Basin Alliance v. Westphal, 230 F.3d 170, 174 (5th Cir. 2000). The parties may satisfy their respective burdens by tendering depositions, affidavits, and other competent evidence. Topalian v. Ehrman, 954 F.2d 1125, 1131 (5th Cir. 1992). The Court views the summary judgment evidence in the light most favorable to the non-movant. Rosado v. Deters, 5 F.3d 119, 123 (5th Cir. 1993). “After the non-movant has been given the opportunity to raise a genuine factual issue, if no reasonable juror could find for the non-movant, summary judgment will be granted.” Westphal, 230 F.3d at 174.

         On cross-motions for summary judgment, the court examines each party's motion independently, viewing the evidence and inferences in the light most favorable to the nonmoving party. White Buffalo Ventures, LLC v. Univ. of Tex. at Austin, 420 F.3d 366, 370 (5th Cir. 2005). “Cross-motions for summary judgment will not, in and of themselves, warrant the granting of summary judgment unless one of the parties is entitled to judgment as a matter of law . . . .” Joplin v. Bias, 631 F.2d 1235, 1237 (5th Cir. 1980). Each party may move for summary judgment using different legal theories that rely on different sets of material facts. Bricklayers, Masons & Plasterers Int'l Union of Am. v. Stuart Plastering Co., 512 F.2d 1017, 1023 (5th Cir. 1975). Nonetheless, cross-motions for summary judgment may be probative of the absence of a factual dispute when they reveal a basic agreement concerning what legal theories and material facts are dispositive. See id.

         III. DISCUSSION

         A. Trademark Infringement

         To prevail on its claim of trademark infringement under the Lanham Act, Plaintiff must establish: (1) it possesses a legally protectable trademark and (2) Defendant's use of this trademark “‘creates a likelihood of confusion as to source, affiliation, or sponsorship.'” Nola Spice Designs, L.L.C. v. Haydel Enters., Inc., 783 F.3d 527, 536 (5th Cir. 2015). The elements of common law trademark infringement under Texas law are the same as those under the Lanham Act. Id. (citing Hot-Hed, Inc. v. Safehouse Habitats (Scotland), Ltd., 333 S.W.3d 719, 730 (Tex. App.-Houston [1st Dist.] 2010, pet. denied)). Additionally, with respect to infringement, Defendant argues that it is an intermediate junior mark user, which the Court addresses at the end of this section.

         1. Possession of a Legally Protectable Trademark

         Plaintiff argues that (1) it has a Texas trademark registration for HEY GORGEOUS; (2) it has used the Mark in commerce since early 2012; and (3) its Mark is entitled to protection from infringement by junior users because its degree of distinctiveness is fanciful or arbitrary and at the very least suggestive. (Pl.'s Mot. Summ. J., Dkt. 25, at 5-7). Defendant counters that the Mark is generic and therefore not protected. (Def.'s Mot. Summ. J., Dkt. 28, at 4-9).

         a. Presumption of Validity

         Much like a federal trademark, a Texas trademark registration creates a statutory presumption of validity, which courts have recognized. For example, in Igloo Products Corporation v. Brantex, Inc., the Fifth Circuit explained that there was a “‘presumption of validity' in any trademark for which ‘a certificate of registration is issued by the secretary of state under this chapter.'” 202 F.3d 814, 818 (5th Cir. 2000) (citing Tex. Bus. & Com. Code Ann. § 16.15) (internal brackets omitted). Since Igloo was decided, the Texas Legislature revised the trademark statute. The new provision that addresses validity states, in relevant part:

§ 16.060. Record and Proof of Registration
* * *
(c) A certificate of registration issued by the secretary of state under this chapter, or a copy of it certified by the secretary of state, is admissible in evidence as prima facie proof of
(1) the validity of the registration;
(2) the registrant's ownership of the mark; and
(3) the registrant's exclusive right to use the mark in commerce in this state in connection with the goods or services specified in the certificate, subject to any conditions and limitations stated in the certificate.

Tex. Bus. & Com. Code Ann. § 16.060.

         The former provision, ...


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