Prime Hookah sued several distributors of hookah-related products, accusing them of importing and selling products bearing Prime Hookah’s DUD trademark. The case was originally filed in New Jersey, and included trademark infringement and dilution claims as well as unfair competition claims under state and federal law. The case was transferred to Massachusetts in early 2020, at which point the Defendants moved to dismiss for failure to state a claim. Judge Saylor granted in part and denied in part that motion. He noted that the complaint was poorly drafted with primarily conclusory allegations, and while it asserted that the Defendants sold DUD-labelled products, it did not allege that these products were not genuine DUD (i.e., Prime Hookah-produced) products. The reference to the websites of the Defendants provided no further information, as one was disabled and a second did not display products, and no screenshots of the sites were attached to the complaint. He reluctantly, and “with considerable misgivings,” however, determined that the infringement claims managed to “scrape over the low bar necessary to survive a motion to dismiss.” He dismissed the dilution count, as the complaint did not sufficiently allege facts that would support the DUD mark being famous. He also dismissed the count for importation of goods bearing infringing names or marks as inadequately pled, again pointing to the lack of specific, non-conclusory factual allegations. Finally, the counts against specific individuals were dismissed for failing to allege that they personally took steps in the alleged infringements.
Judge Saylor has now denied Prime Hookah’s motion for a preliminary injunction. He indicates his belief that Prime could have marshalled sufficient evidence to demonstrate a likelihood of success on the merits, but for whatever reason failed to do so. He noted that the Defendants’ suggestion that the registration is invalid for fraud on the PTO was not implausible, even if at present they had not proven that Prime knew about a prior registration for the same mark by another company in the Netherlands. He found that likelihood of confusion had not been demonstrated because Prime had introduced little evidence of what the allegedly infringing marks look like. Prime’s registration is to a stylized version with the mark “DUD” in fanciful font, surrounded by a circle and with a flame arising from the “U” in DUD. Yet Prime gave no description of what the marks on the accused products look like, and provided photos of unrelated products or unauthenticated photographs. The sole exception is the testimony on a single individual that one of the defendants sold a single product at a trade show that bore a similar mark. Further, Judge Saylor determined that the DUD mark is not particularly strong, having been registered only in January 2018 and having had no evidence of Prime’s renown in the industry or efforts made to promote and protect the mark. Judge Saylor determined that, while there is certainly a chance that Prime will prevail, at this stage it has failed to demonstrate a substantial likelihood of success on the merits. Accordingly, the motion for a permanent injunction was denied.
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