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Nerium International LLC v. Aloeveritas Americas LLC

United States District Court, N.D. Texas, Dallas Division

April 24, 2018

NERIUM INTERNATIONAL, LLC, Plaintiff,
v.
ALOEVERITAS AMERICAS, LLC, HW & B ENTERPRISES, LLC, CHRIS HARDY, and JOSEPH J. MACKEY Defendants.

          MEMORANDUM OPINION AND ORDER

          JANE J. BOYLE UNITED STATES DISTRICT JUDGE

         Nerium International, LLC (NI) and the defendants (collectively Aloeveritas) compete as marketers and sellers of high-end skin-care products. In this case, NI has sued Aloeveritas, accusing it of using marks and packaging so confusingly similar to NI's as to violate federal trademark law. Aloeveritas now asks the Court to dismiss NI's lawsuit, arguing that NI has failed to state a claim and failed to join a necessary party. Unpersuaded by Aloeveritas's arguments, the Court DENIES the motion to dismiss.

         I. BACKGROUND[1]

         A. Factual Background

         NI sells high-end skin-care products, including a day cream and a night cream derived from the nerium oleander plant, from which NI takes its name. Doc. 1, Compl., ¶ 10. NI claims that its products have been a great success, earning NI millions of dollars and much respect, and that the public so strongly associates the Nerium mark and trade dress with NI that NI owns the mark and trade dress and that the Nerium mark is famous as a matter of trademark law. Id. ¶ 11.

         Aloeveritas too sells high-end skin-care products, including day creams and night creams derived from the nerium oleander plant. Id. ¶ 14. NI alleges that Aloeveritas's promotional materials and packaging include the phrase “nerium night cream” and “nerium day cream” and that Aloeveritas's packaging closely resembles NI's. Id. ¶¶ 14-17. NI claims also that Aloeveritas has marketed its day and night creams as “bestselling” products and that, because Aloeveritas has sold its day and night creams in the United States only since October 2017, Aloeveritas's claim that its products are “bestselling” can only be based on NI's sales of nerium-based creams. Id. ¶ 18. And NI accuses Aloeveritas of using NI's success and scientific research to promote Aloeveritas's products. Id. ¶ 19.

         Aloeveritas contends in its motion to dismiss that NI does not own the Nerium mark. Doc. 11, Mot. to Dismiss, 2. Rather, according to Aloeveritas, a company called Nerium Biotechnology, Inc. (NBI) owns the mark and has licensed Aloeveritas to use the mark. Id. NBI is currently litigating against NI in another case before the Court. See Nerium SkinCare, Inc. v. Nerium Int'l, LLC, No. 3:16-cv-1217-B, 2017 WL 177651 (N.D. Tex. Jan. 16, 2017). B. Procedural History NI filed its complaint on October 30, 2017, alleging four federal trademark-related causes of action against Aloeveritas: (1) trademark infringement, 15 U.S.C. § 1125(a); (2) trade dress infringement, id.; (3) false advertising, id.; and (4) trademark dilution, id. § 1125(c). Doc. 1, Compl., ¶¶ 22-50. Aloeveritas responded by moving the Court to dismiss NI's lawsuit under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim and under Rule 12(b)(7) for failure to join a necessary party under Rule 19. Doc. 11, Mot. to Dismiss. Aloeveritas's motion is ripe for review.

         II.

         LEGAL STANDARD

         A. Rule 12(b)(6)

         Federal Rule of Civil Procedure 12(b)(6) authorizes dismissal for failure to state a claim upon which relief may be granted. When analyzing Rule 12(b)(6) motions, courts generally consider “the complaint, its proper attachments, documents incorporated into the complaint by reference, and matters of which a court may take judicial notice.” Randall D. Wolcott, M.D., P.A. v. Sebelius, 635 F.3d 757, 763 (5th Cir. 2011). During this review, factual allegations must be viewed “in the light most favorable to the plaintiffs.” Kopp v. Klien, 722 F.3d 327, 333 (5th Cir. 2013). Courts are not, however, “bound to accept as true a legal conclusion couched as a factual allegation.” Bell Atl. Corp. v Twombly, 550 U.S. 544, 555 (2007).

         Rule 12(b)(6) motions turn on whether a complaint contains “enough facts to state a claim to relief that is plausible on its face.” Id. at 570. Facially plausible complaints “allege ‘more than labels and conclusions'” and contain enough factual allegations “‘to raise a right to relief above the speculative level.'” Norris v. Hearst Tr., 500 F.3d 454, 464 (5th Cir. 2007) (quoting Twombly, 550 U.S. at 555). If the allegations lack sufficient detail, “this basic deficiency should . . . be exposed” before the parties and court spend unnecessary time and resources on the case. Twombly, 550 U.S. at 558.

         B. Rule 12(b)(7)

         A party can move under Rule 12(b)(7) to dismiss a case in which a party is absent that Rule 19 requires to be present. Under Rule 19(a), a person “subject to service of process and whose joinder will not deprive the court of subject-matter jurisdiction must be joined as a party if” (1) the person's absence will prevent the court from “accord[ing] complete relief among existing parties, ” or (2) the person has an interest in the subject of the case, and disposing of it in the person's absence will either “impair or impede the person's ability to protect the interest, ” or create a risk of multiple or inconsistent obligations for an existing party because of the interest. ...


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