Petition for Writ of Certiorari — Arcona, Inc., Petitioner v. Farmacy Beauty, LLC, et al.

App. 1

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ARCONA, INC., a

California corporation,

Plaintiff-Appellant,

v.

No. 19-55586

D.C. No.

2:17-cv-07058ODW-JPR

FARMACY BEAUTY, LLC,

a New Jersey limited liability

company; DAVID C. CHUNG,

an individual; MARK VEEDER,

an individual,

OPINION

Defendants-Appellees.

Appeal from the United States District Court

for the Central District of California

Otis D. Wright II, District Judge, Presiding

Argued and Submitted June 5, 2020

Pasadena, California

Filed October 1, 2020

Before: Kenneth K. Lee and Patrick J. Bumatay,

Circuit Judges, and Donald W. Molloy,* District Judge.

Opinion by Judge Lee

* The Honorable Donald W. Molloy, United States District

Judge for the District of Montana, sitting by designation.

App. 2

COUNSEL

R. Joseph Trojan (argued), Dylan C. Dang, and Francis

Z. Wong, Trojan Law Offices, Beverly Hills, California,

for Plaintiff-Appellant.

Colin Fraser (argued), Greenberg Traurig LLP, Irvine,

California; Jeffrey K. Joyner, Greenberg Traurig LLP,

Los Angeles, California; for Defendants-Appellees.

OPINION

LEE, Circuit Judge:

Arcona, Inc. sued Farmacy Beauty for counterfeiting based on the use of the trademarked term “EYE

DEW” on its skincare products. But apart from that

term, these two companies’ beauty products look

nothing like each other, as their respective packaging

features different shapes, design schemes, text, and

colors. The district court granted summary judgment

for Farmacy, ruling that a reasonable consumer would

not confuse Farmacy’s skincare product with Arcona’s.

The key question presented is whether a trademark

counterfeiting claim requires a likelihood of confusion.

We hold that the plain language of the statute requires

a likelihood of confusion for a counterfeit claim. We

thus affirm the grant of summary judgment.

BACKGROUND

In March 2015, Plaintiff-Appellant Arcona, Inc.

registered the trademark “EYE DEW” for its skincare

products. The trademarked phrase “consists of standard

App. 3

characters without claim to any particular font, style,

size, or color.” Arcona’s EYE DEW product is an eye

cream in a tall, cylindrical, silver bottle encased in a

slim, cardboard outer box. The product features the

phrase “EYE DEW” and the Arcona housemark on both

its bottle and outer box. Arcona sells the product

mainly at Nordstrom in the United States and at

Sephora in Australia and Asia.

In 2014, Defendant-Appellee Farmacy Beauty began developing a line of skincare products, including

an eye cream. Farmacy named the eye cream “EYE

DEW” after a copywriter said that the name was likely

available based on “an initial online search and

uspto.gov trademark lookup.” Farmacy’s EYE DEW

App. 4

product (pictured below) comes in a short, wide, white

jar, along with a squarish outer box. The product features the phrase “EYE DEW” and the Farmacy house

mark on both its jar and outer box. In 2015, Farmacy

began selling EYE DEW in the United States at

Sephora.

In August 2016, Arcona sent Farmacy a cease-anddesist letter informing Farmacy of its “EYE DEW”

trademark and demanding that Farmacy stop selling

its product. The record suggests that Farmacy had

never heard of Arcona and was surprised to receive the

letter. The parties unsuccessfully tried to resolve the

matter.

In September 2017, Arcona sued Farmacy asserting claims of (1) trademark counterfeiting, (2) trademark infringement, (3) unfair competition under

Section 43(a) of the Lanham Act, (4) unfair competition

under California state law, and (5) unfair competition

under California common law. At Arcona’s request, the

district court dismissed with prejudice the trademark

infringement and unfair competition claims.

The district court granted partial summary judgment for Farmacy on the counterfeiting claim. The

App. 5

court reasoned that the only similarity between the

two products was the phrase “EYE DEW.” The court

also found that Arcona “present[ed] no evidence that

the Farmacy house mark on the product, the dissimilar

packaging, and the product itself [did] not nullify

[Arcona]’s counterfeiting claim.” It further held that it

was “implausible that a consumer viewing [Farmacy’s]

EYE DEW product would be tricked into believing that

product is actually one of [Arcona’s] EYE DEW products.”

Arcona timely appealed. We have jurisdiction under 28 U.S.C. § 1291.

STANDARD OF REVIEW

We review a district court’s grant of summary

judgment de novo. Devereaux v. Abbey, 263 F.3d 1070,

1074 (9th Cir. 2001) (en banc). The moving party is

entitled to summary judgment upon a showing that no

genuine issue of material fact exists and that the moving party is entitled to judgment as a matter of law. See

Fed. R. Civ. P. 56(a). We view the facts and inferences

drawn from the facts in the nonmovant’s favor. T.W.

Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 809 F.2d

626, 631–32 (9th Cir. 1987). We may affirm summary

judgment on any grounds supported by the record.

Gemtel Corp. v. Cmty. Redevelopment Agency, 23 F.3d

1542, 1546 (9th Cir.1994).

App. 6

ANALYSIS

I.

Under the Lanham Act, Farmacy is liable

for counterfeiting only if Farmacy’s use of

Arcona’s mark is likely to confuse consumers.

Arcona’s complaint against Farmacy lists “Violation of Trademark Counterfeiting Act of 1984” as its

first cause-of-action. The Trademark Counterfeiting

Act of 1984 criminalizes the trafficking of counterfeit

trademark goods. 18 U.S.C. § 2320. The Act also

amended the Lanham Act, 15 U.S.C. §§ 1501 et seq., to

create stronger remedies for civil cases involving a

counterfeit trademark. See 15 U.S.C. § 1117 (allowing

for treble damages and attorneys’ fees).

Arcona argues that it need not show a likelihood

of confusion to pursue its trademark counterfeiting

claim. The “starting point for interpreting a statute is

the language of the statute itself.” Consumer Prod.

Safety Comm’n v. GTE Sylvania, Inc., 447 U.S. 102, 108

(1980). “It is a fundamental canon of statutory construction that the words of a statute must be read in

their context and with a view to their place in the overall statutory scheme.” Sturgeon v. Frost, 136 S. Ct.

1061, 1070 (2016).

Here, 15 U.S.C. § 1114 establishes the cause of action for, among other things, counterfeiting and states

that “[a]ny person who . . . use[s] in commerce any reproduction, counterfeit, copy, or colorable imitation of a

registered mark . . . which such use is likely to cause

confusion, or to cause mistake, or to deceive . . . shall

App. 7

be liable in a civil action by the registrant for the remedies hereinafter provided.” 15 U.S.C. § 1114(1)(a) (emphasis added). The plain language of the statute thus

shows that “likely to cause confusion” is a requirement

for a counterfeiting claim.

Perhaps recognizing that the two products look

little like each other, Arcona argues that a counterfeiting claim does not require a likelihood of confusion. It

points to two statutory provisions establishing various

remedies for counterfeiting that do not mention “likelihood of confusion.” First, 15 U.S.C. § 1116(d) allows

ex parte relief to seize counterfeit goods. 15 U.S.C.

§ 1116.1 Although the text of that subsection does not

reference “confusion” in defining “counterfeit mark,”

it refers to a civil action under “section 1114(1)(a),”

which (as noted above) establishes the cause of action

for counterfeiting and includes a likelihood of confusion requirement. 15 U.S.C. § 1116(d)(1)(A). Second,

15 U.S.C. § 1117 authorizes statutory and treble damages for counterfeiting, and again refers to Section

1114(1)(a), which includes a likelihood of confusion

1

15 U.S.C. § 1116(d) states in part:

“Civil Actions Arising Out of Use of Counterfeit

Marks

(1)(A) In the case of a civil action arising under section

1114(1)(a) of this title . . . with respect to a violation

that consists of using a counterfeit mark in connection

with the sale, offering for sale, or distribution of goods

or services, the court may, upon ex parte application,

grant an order under subsection (a) of this section pursuant to this subsection providing for the seizure of

goods and counterfeit marks. . . .” (emphasis added).

App. 8

requirement. 15 U.S.C. § 1117(b).2 In short, even the

two counterfeiting remedies provisions cited by Arcona underscore that a defendant is liable only if use

of a counterfeit is “likely to cause confusion.” 15 U.S.C.

§ 1114(1)(a).3

It appears that our court has not yet expressly

held that a counterfeiting claim requires a likelihood

of confusion. That said, Section 1114 addresses both

trademark infringement and counterfeit claims, and

2

15 U.S.C. § 1117(b) states in part:

“Treble Damages for Use of Counterfeit Mark.

In assessing damages under subsection (a) for any violation of section 1114(1)(a) of this title . . . in a case involving use of a counterfeit mark or designation (as

defined in section 1116(d) of this title), the court shall

. . . enter judgment for three times such profits or damages, whichever amount is greater, together with a reasonable attorney’s fee, if the violation consists of (1)

intentionally using a mark or designation, knowing

such mark or designation is a counterfeit mark (as defined in section 1116(d) of this title), in connection with

the sale, offering for sale, or distribution of goods or

services. . . .” (emphasis added).

3

The district court appeared to base its ruling in part on the

ground that the “EYE DEW” mark is not even a counterfeit. Section 1127 defines “counterfeit” as a “a spurious mark which is

identical with, or substantially indistinguishable from, a registered mark.” 15 U.S.C. § 1127. The district court appeared to construe Section 1127 to allow a court to look beyond the mark and

examine the product as a whole in determining whether the “spurious mark” is “identical with, or substantially indistinguishable”

from the registered mark. We need not resolve this issue because,

even if the mark is a counterfeit, no reasonable juror would find

a likelihood of consumer confusion under Section 1114. See infra

pp. 12–14.

App. 9

we have repeatedly held that the plain language of

Section 1114 requires a likelihood of confusion for a

trademark infringement claim. See, e.g., Stone Creek,

Inc. v. Omnia Italian Design, Inc., 875 F.3d 426, 431

(9th Cir. 2017). But we have not directly addressed it

in the context of a counterfeit claim, perhaps because

consumer confusion is generally not in dispute in most

counterfeit cases. See, e.g., Gibson Brands, Inc. v. John

Hornby Skewes & Co., 14-CV-00609 (DDP), 2016 WL

7479317, at *6 (C.D. Cal. Dec. 29, 2016) (noting case

law on counterfeit claims is “understandably thin”).

For example, the use of a counterfeit Louis Vuitton

trademark on a handbag is obviously intended to confuse consumers. Put another way, a counterfeit claim

is merely “the ‘hard core’ or first degree’ of trademark

infringement,” and there is nothing in the statutory

language of Section 1114 that suggests that a counterfeit claim should be construed differently from an

infringement claim. Id. at *5 (internal citation omitted).

Several of our decisions have followed the plain

meaning of Section 1114 and have required a likelihood of confusion for claims under that section. For

example, in Westinghouse Elec. Corp. v. Gen. Circuit

Breaker & Elec. Supply, Inc., we held that Section 1114

was “intended to protect consumers against deceptive

designations of the origin of goods, not just to prevent

the duplication of trademark.” 106 F.3d 894, 899 (9th

Cir. 1997) (cleaned up). “Thus, the important test is

whether the practice of the defendant is likely to

cause confusion, not whether the defendant duplicated

App. 10

the plaintiff ’s mark.” Id.; see also Levi Strauss & Co. v.

Shilon, 121 F.3d 1309, 1312 (9th Cir. 1997) (noting that

a counterfeit product is likely to “cause confusion, or to

cause mistake or to deceive”).

More recently, we held that “to invoke § 1117’s special civil monetary remedies against counterfeiting,” a

plaintiff must establish, among other things, that the

counterfeit mark “was likely to confuse or deceive.”

Idaho Potato Comm’n v. G & T Terminal Packaging,

Inc., 425 F.3d 708, 721 (9th Cir. 2005) (finding defendant’s unlicensed use of plaintiff ’s certification mark

constituted counterfeiting because it was likely to

cause confusion). We required a likelihood of confusion,

even though Section 1117’s civil monetary remedies

provision does not itself explicitly mention it and instead refers to Section 1114, which does.

Other circuits also read the statutory provisions to

require a likelihood of confusion for a counterfeiting

claim. See Springboards to Educ., Inc. v. Houston

Indep. Sch. Dist., 912 F.3d 805, 818 (5th Cir. 2019)

(“Likelihood of confusion is also an element of counterfeiting.”); Kelly-Brown v. Winfrey, 717 F.3d 295, 315 (2d

Cir. 2013) (dismissing counterfeiting claim after describing the marks and concluding that consumers

would not be confused).

We thus hold that a counterfeit claim requires a

showing of likelihood of confusion under Section 1114.

App. 11

II.

The court will not presume consumer confusion here because the products are not

identical.

Arcona makes the alternative argument that the

court should presume a likelihood of confusion because

Farmacy’s “EYE DEW” statement is allegedly identical

to Arcona’s mark. But even assuming the marks are

identical, there may be no presumption of consumer

confusion if the products themselves are not identical.

Put another way, a court must review the product as a

whole in determining whether an allegedly counterfeit

product will likely cause confusion.

Arcona relies heavily on a trademark infringement case, Brookfield Communications, Inc. v. West

Coast Entertainment Corp., which in dicta stated in

“light of the virtual identity of marks, if they were used

with identical products or services, likelihood of confusion would follow as a matter of course.” 174 F.3d 1036,

1056 (9th Cir. 1999) (emphasis added) (ruling that

there was no presumption of confusion because MovieBuff software was not the same product service as

moviebuff.com website); see also Stone Creek Inc., 875

F.3d at 432 (indicating “identical marks paired with

identical goods can be case-dispositive” in a case involving an “exact replica” of a competitor’s logo on the

same sofa (emphasis added)).

Here, the products at issue are not identical, as evident by a comparison of the Arcona and Farmacy products. So Brookfield’s dicta has no bearing on this case.

The question then becomes: Is there a factual dispute

App. 12

about the likelihood of confusion so that Arcona’s counterfeiting claim can survive summary judgment?

III. Summary judgment was proper because

there is no genuine dispute of material fact

about the likelihood of consumer confusion.

Finally, Arcona argues that the district court erred

in comparing the products as a whole in ruling that

there is no likelihood of consumer confusion. The district court, according to Arcona, should have limited its

analysis to the identical marks (“EYE DEW”) only—

without looking at the entire product—in assessing

consumer confusion.

This court has never adopted the rigid approach

advanced by Arcona. To the contrary, this court noted

that even “where there is precise identity of a complainant’s and an alleged infringer’s mark, there may

be no consumer confusion” if, for example, “the alleged

infringer is in a different geographic area or in a

wholly different industry.” Brookfield, 174 F.3d at 1055

(addressing trademark infringement claims and discussing cases in which companies or products had the

same names, but there was no confusion because they

competed in different geographic areas or industries).

A court should not myopically focus on only the alleged

counterfeit marks to the exclusion of the entire product

or even common sense.4 Here, while the products do

4

There may be times the mark itself is so strong in the marketplace that the use of an identical mark by itself may cause

consumer confusion, even if other aspects of the products are

App. 13

compete in the same space and same geographic area,

there are significant differences between the two products, and the marks should be “considered in their entirety and as they appear in the marketplace.” Id. at

1054 (internal quotation marks omitted).

As the district court explained, no reasonable consumer would be confused by these two products because the packaging, size, color, shape, and all other

attributes—other than the term “EYE DEW”—are not

remotely similar. For example, Farmacy’s packaging

looks distinct from Arcona’s because it features (i) multiple pictures of the Echinacea green envy plant used

in the product, (ii) a picture of the farmers, and (iii) a

description of the company.

Further, it is implausible that a consumer would

be deceived because the products had their respective

housemarks (“Farmacy” vs. “Arcona”) prominently on

the packaging. Arcona does not present evidence to dispute this, but states in a conclusory fashion that “[c]onsumers would have no way of knowing” that Arcona did

not sponsor Farmacy’s product. In trademark infringement cases, the “use of a housemark can reduce the

likelihood of confusion.” AMF Inc. v. Sleekcraft Boats,

599 F.2d 341, 351 (9th Cir. 1979), abrogated in part on

other grounds by Mattel, Inc. v. Walking Mtn. Prods.,

353 F.3d 792, 810 (9th Cir. 2003); see also Pignons S.A.

de Mecanique de Precision v. Polaroid Corp., 657 F.2d

482, 487 (1st Cir. 1981) (“[O]therwise similar marks

different. This is not such a case. As noted below, the mark here—

“EYE DEW”—is not so strong.

App. 14

are not likely to be confused where used in conjunction

with the clearly displayed name and/or logo of the

manufacturer”).

Courts—at least in the trademark infringement

context—have also considered a third party’s use of the

mark in assessing likelihood of confusion. See Springboards, 912 F.3d at 815, 817 (recognizing that third

parties used similar and identical marks, and finding

no reasonable jury could find a likelihood of confusion);

cf. M2 Software, Inc., v. Madacy Entm’t, 421 F.3d 1073,

1088 (9th Cir. 2005) (affirming summary judgment on

trademark infringement claim and reasoning that

“[u]se of similar marks by third-party companies in the

relevant industry weakens the mark at issue”). Farmacy presented evidence that other companies use the

phrase “EYE DEW” in the beauty industry. This underscores that the “EYE DEW” mark is not so unique or

strong.

Finally, there is no evidence that Farmacy’s use of

the mark “EYE DEW” was intentional. It submitted

evidence that the term “EYE DEW” was meant to describe its product and was not an intentional copying

of Arcona’s trademark. Arcona does not dispute this

evidence, but instead states without citation that

Farmacy “cannot feign ignorance” of the mark because

Arcona has been selling EYE DEW for over 18 years.

Despite Arcona’s “general, conclusory allegations of

‘willfulness,’ ” it has produced no evidence that Farmacy

intentionally copied its mark. See Pignons, 657 F.2d at

491 (finding no evidence of intent in a trademark infringement case). In addition, Farmacy’s dissimilar

App. 15

packaging and rampant use of its housemark “flatly

belie[s] any such notion.” See id.

In sum, the district court properly found that there

is no genuine issue of material fact that Farmacy’s use

of the “EYE DEW” mark would not likely cause consumer confusion.

CONCLUSION

To sustain a trademark counterfeiting claim, a

plaintiff must show a likelihood of confusion. The two

products, when viewed in their entirety, do not remotely resemble each other. The district court’s decision granting summary judgment for Farmacy is

AFFIRMED.

App. 16

United States District Court

Central District of California

ARCONA, INC.,

Plaintiff,

v.

FARMACY BEAUTY, LLC;

David C. Chung; and

Mark Veeder,

Defendants.

I.

Case No.

2:17-cv-07058-ODW (JPR)

ORDER GRANTING

DEFENDANTS’

MOTION FOR

PARTIAL SUMMARY

JUDGMENT [49]

(Filed Mar. 19, 2019)

INTRODUCTION

Plaintiff, Arcona, Inc., brings this action against

Defendants Farmacy Beauty, LLC (“Farmacy”), and

its officers, David C. Chung and Mark Veeder (collectively, “Defendants”), for various trademark infringement claims related to Plaintiff ’s “EYE DEW” mark.

Pending before the Court is Defendants’ Motion for

Partial Summary Judgment (“Motion) on Plaintiff ’s

counterfeiting claim. (Mot., ECF No. 49.) For the following reasons, the Court GRANTS Defendants’ Motion.1

II.

FACTUAL BACKGROUND

Plaintiff holds a registered trademark, Registration No. 4,706,079, in the United States for the EYE

1

After considering the papers filed in connection with this

Motion, the Court deemed this matter appropriate for decision

without oral argument. Fed. R. Civ. P. 78(b); C.D. Cal. L.R. 7-15.

App. 17

DEW mark. (Defs.’ Statement of Uncontroverted Facts

(“SUF”) 3, ECF No. 49-17.) This International Class

003 trademark includes cosmetic creams for skincare;

cosmetic preparation for skin renewal; eye cream; nonmedicated stimulating lotions for the skin; skin conditioning creams for cosmetic purposes; skin moisturizer;

and wrinkle removing skin care preparations. (First

Am. Compl. (“FAC”) Ex. 1., ECF No. 34-1.) The trademark registration provides that the “mark consists of

standard characters without claim to any particular

font, style, size, or color.” (Id.) Further, the registration

provides that it was filed on April 18, 2012, with a first

use date of January 1, 2002. (Id.)

Farmacy was organized in 2015 by Defendants

David Chung and Mark Veeder in 2015. (SUF 6.) Farmacy began selling an eye cream product entitled

“EYE DEW” in 2015. (Id. 8.) Farmacy stopped selling

this product in September 2017. (Id. 10.)

App. 18

The products are shown below:

Arcona “Eye Dew”

Arcona “Eye Dew Plus”

Farmacy “Eye Dew”

Plaintiff filed its Complaint against Defendants in

September 2017 and subsequently amended its Complaint in April 2018. (Compl., ECF No. 1; FAC.) Defendants move for partial summary judgment only as to

Plaintiff ’s counterfeiting claim. (Mot.)

App. 19

III.

LEGAL STANDARD

A court “shall grant summary judgment if the movant shows that there is no genuine dispute as to any

material fact and the movant is entitled to judgment

as a matter of law.” Fed. R. Civ. P. 56(a). Courts must

view the facts and draw reasonable inferences in the

light most favorable to the nonmoving party. Scott, 550

U.S. at 378. A disputed fact is “material” where the resolution of that fact might affect the outcome of the suit

under the governing law, and the dispute is “genuine”

where “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, 248 (1986).

Conclusory or speculative testimony in affidavits is

insufficient to raise genuine issues of fact and defeat

summary judgment. Thornhill’s Publ’g Co. v. GTE

Corp., 594 F.2d 730, 738 (9th Cir. 1979). Moreover,

though the Court may not weigh conf licting evidence

or make credibility determinations, there must be

more than a mere scintilla of contradictory evidence to

survive summary judgment. Addisu v. Fred Meyer, Inc.,

198 F.3d 1130, 1134 (9th Cir. 2000).

Once the moving party satisfies its burden, the

nonmoving party cannot simply rest on the pleadings

or argue that any disagreement or “metaphysical

doubt” about a material issue of fact precludes summary judgment. See Celotex Corp. v. Catrett, 477 U.S.

317, 322-23 (1986); Matsushita Elec. Indus. Co., Ltd. v.

Zenith Radio Corp., 475 U.S. 574, 586 (1986); Cal. Architectural Bldg. Prods., Inc. v. Franciscan Ceramics,

Inc., 818 F.2d 1466, 1468 (9th Cir. 1987). Nor will

App. 20

uncorroborated allegations and “self-serving testimony” create a genuine issue of material fact. Villiarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th

Cir. 2002). The court should grant summary judgment

against a party who fails to demonstrate facts sufficient to establish an element essential to his case when

that party will ultimately bear the burden of proof at

trial. See Celotex, 477 U.S. at 322.

Pursuant to the Local Rules, parties moving for

summary judgment must file a proposed “Statement of

Uncontroverted Facts and Conclusions of Law” that

should set out “the material facts as to which the moving party contends there is no genuine dispute.” C.D.

Cal. L.R. 56-1. A party opposing the motion must file a

“Statement of Genuine Disputes” setting forth all material facts as to which it contends there exists a genuine dispute. C.D. Cal. L.R. 56-2. “[T]he Court may

assume that material facts as claimed and adequately

supported by the moving party are admitted to exist

without controversy except to the extent that such material facts are (a) included in the ‘Statement of Genuine Disputes’ and (b) controverted by declaration or

other written evidence filed in opposition to the motion.” C.D. Cal. L.R. 56-3.

IV.

DISCUSSION

Defendants move for partial summary judgment

only on Plaintiff ’s claim for counterfeiting, that Defendants’ “Eye Dew” product is a counterfeit of Plaintiff ’s “Eye Dew” products. (See generally Mot.)

App. 21

A. Counterfeiting

The parties do not dispute the material facts. However, the parties disagree on the law.

The Lanham Act prohibits the use of a counterfeit “mark in connection with the sale, offering for

sale, or distribution of goods or services.” 15 U.S.C.

§ 1116(d)(1)(A). “A counterfeit is a spurious mark

which is identical with, or substantially indistinguishable from, a registered mark.” Id. § 1127 (internal

quotation marks omitted). Courts consider trademark

counterfeiting as the “hard core or first degree . . .

trademark infringement that seeks to trick the consumer into believing he or she is getting a genuine article, rather than a colorable imitation.” Gucci America,

Inc. v. Guess?, Inc., 868 F. Supp. 2d 207, 242 (S.D.N.Y.

2012) (citing 4 McCarthy on Trademarks § 25:10) (internal quotation marks omitted).

As this district recently recognized, “[t]he caselaw on what is required to plead identicality in a

counterfeiting claim is understandably thin, as the

majority of counterfeiting cases involve obviously identical marks.” Gibson Brands, Inc. v. John Hornby

Skewes & Co., No. CV 14-00609 DDP (SSx), 2016 WL

7479317, at *6 (C.D. Cal. Dec. 29, 2016) (internal quotation marks omitted). “The Ninth Circuit has explained that a ‘counterfeit is something that purports

to be something that it is not.’ ” Id. (quoting United Pac.

Ins. Co. v. Idaho First. Nat. Bank, 378 F.2d 62, 69 (9th

Cir. 1967)). The court in Gucci America, Inc., in reviewing the caselaw on claims for counterfeiting involving

App. 22

products, found that “courts have uniformly applied

this provision to products that are stitch-for-stitch copies of those of another brand.” 868 F. Supp. 2d at 242;

see also Idaho Potato Comm’n v. G & T Terminal Packaging, Inc., 425 F.3d 708, 721 (9th Cir. 2005) (affirming

award of counterfeiting where the defendant purchased empty bags containing the plaintiff ’s logo and

repackaged its own goods in those bags).

Plaintiff takes the position that the Court should

consider only Defendants’ use of the phrase “EYE

DEW,” and not the entire product. (Opp’n to Mot. 9,

ECF No. 58.) Although Plaintiff recognizes that its

trademark registration does not include the font, style,

size, and color, Plaintiff ’s Opposition to the counterfeit

claim focuses exclusively on the typeface and font.

(Opp’n 9-11.) The Court gives Plaintiff ’s position little

weight, particularly when Plaintiff ’s trademark registration states, “[t]he mark consists of standard characters without claim to any particular font, style, size, or

color.” (FAC Ex. 1.) For Plaintiff to now claim that the

font, style, and color of the “EYE DEW” phrase are the

bases for its counterfeit claim is disingenuous and contrary to its trademark registration.

The Court recognizes that in certain circumstances, the inclusion of a house mark on a product is

not sufficient to defeat a counterfeiting claim. See Tiffany & Co. v. Costco Wholesale Corp., 127 F. Supp. 3d

241, 254-55 (S.D.N.Y. 2015) (granting summary judgment in favor of plaintiff on counterfeiting claim where

the only difference between the parties’ rings was a

App. 23

small generic mark on the inside of the ring). That is

not the case here.

Without determining the specific level of similarity between the EYE DEW products, the Court

concludes that no reasonable jury could find that Defendants’ EYE DEW product is a counterfeit of Plaintiff ’s EYE DEW products. The only similarity between

the two products are that they both contain the phrase

“EYE DEW.” However, Defendants’ EYE DEW product

does not purport to be Plaintiff ’s products. Visually, the

products’ packaging is not identical or substantially indistinguishable. Plaintiff ’s products are tall and cylindrical, whereas Defendants’ product is short and wide.

Each product bears their respective house marks. Each

presents a distinct color and packaging scheme. Defendants’ product claims that it is a “total eye cream

with echinacea greenenvy™,” while no such claim is

made with Plaintiff ’s products. (SUF 11, 12, 14.) Although use of a different source mark indicator may

not always defeat a counterfeiting claim, Plaintiff presents no evidence that the Farmacy house mark on

the product, the dissimilar packaging, and the product itself do not nullify Plaintiff ’s counterfeiting claim.

See Gibson Brands, 2016 WL 7479317, at *6 (granting

summary judgment on a counterfeiting claim where

the plaintiff failed to present evidence that the defendant’s use of a brand mark nullified the plaintiff ’s

claim).

The Court finds it implausible that a consumer

viewing Defendants’ EYE DEW product would be

tricked into believing that the product is actually one

App. 24

of Plaintiff ’s EYE DEW products. Accordingly, partial

summary judgment for Defendants as to Plaintiff ’s

claim for counterfeiting is proper.

V.

CONCLUSION

For the foregoing reasons, the Court GRANTS Defendants’ Motion for Summary Judgment as to Plaintiff ’s claim for counterfeiting.

IT IS SO ORDERED.

March 19, 2019

/s/

Otis D. Wright

OTIS D. WRIGHT, II

UNITED STATES

DISTRICT JUDGE

App. 25

UNITED STATES DISTRICT COURT

FOR THE CENTRAL DISTRICT OF CALIFORNIA

WESTERN DIVISION

ARCONA, INC., a

California corporation,

Plaintiff,

CASE NO. 2:17-cv07058 ODW (JPRx)

JUDGMENT

v.

FARMACY BEAUTY, LLC,

a New Jersey limited liability

company, DAVID C. CHUNG,

an individual, and MARK

VEEDER, an individual,

The Hon.

Otis D. Wright, II

(Filed May 8, 2019)

Defendants.

AND RELATED

COUNTERCLAIMS

This Action arises from Plaintiff Arcona, Inc.’s

First Amended Complaint (ECF No. 34) against Defendants Farmacy Beauty, LLC, David C. Chung, and

Mark Veeder (collectively, “Defendants”) for: 1) Trademark Counterfeiting of Arcona’s U.S. Trademark Registration No. 4,706,079 (“Arcona’s ‘079 Trademark

Registration”); 2) Infringement of Arcona’s ‘079 Trademark Registration; 3) Violation of Federal Unfair

Competition; 4) Unfair Competition under California

Business and Professions Code section 17200 et seq.;

and 5) California Common Law Unfair Competition.

Defendants have asserted counterclaims seeking a

App. 26

declaration of non-infringement and cancellation of

Arcona’s ‘079 Trademark Registration.

On March 19, 2019, the Court granted summary

judgment for Defendants on Plaintiff ’s claim for counterfeiting having found, inter alia, that “no reasonable

jury could find that Defendants’ EYE DEW product is

a counterfeit of Plaintiff ’s EYE DEW products.” (ECF

No. 129.)

On April 22, 2019, the Court granted Plaintiff ’s request pursuant to Federal Rule of Civil Procedure

41(a)(2) to dismiss its remaining claims with prejudice

and Defendants’ counterclaims without prejudice.

(ECF No. 136.)

Accordingly, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that:

1.

Pursuant to the Court’s Order Granting Defendants’ Motion for Partial Summary Judgment (ECF No. 129), and Order on Plaintiff ’s

Request (ECF No. 136), judgment is entered

in favor of Defendants and against Plaintiff on

Plaintiff ’s First Cause of Action for Trademark

Counterfeiting of Arcona’s ‘079 Trademark

Registration pursuant to the Trademark

Counterfeiting Act of 1984;

2.

Plaintiff ’s Second, Third, Fourth, and Fifth

causes of action for trademark infringement

of Arcona’s ‘079 Trademark Registration and

unfair competition (Federal and State Law),

respectively, all of which are hereby DISMISSED WITH PREJUDICE;

App. 27

3.

Pursuant to the Court’s Order on Plaintiff ’s

Request (ECF No. 136), Defendants’ counterclaims for non-infringement and cancellation

of Arcona’s ‘079 Trademark Registration are

hereby DISMISSED WITHOUT PREJUDICE;

4.

All other dates and deadlines in this case are

hereby VACATED; and

5.

The Clerk of the Court shall close the case.

IT IS SO ORDERED, ADJUDGED, AND DECREED.

Dated: May 8, 2019

/s/ Otis D. Wright II

Hon. Otis D. Wright II

United States District Judge

App. 28

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ARCONA, INC., a California

corporation,

Plaintiff-Appellant,

v.

FARMACY BEAUTY, LLC,

a New Jersey limited liability

company; et al.,

No. 19-55586

D.C. No.

2:17-cv-07058ODW-JPR

Central District

of California,

Los Angeles

ORDER

Defendants-Appellees. (Filed Nov. 9, 2020)

Before: LEE and BUMATAY, Circuit Judges, and

MOLLOY,* District Judge.

The panel has voted to deny the petition for panel

rehearing. Judges Lee and Bumatay have voted to

deny the petition for rehearing en banc, and Judge

Molloy has so recommended. The full court has been

advised of the petition for rehearing en banc, and no

judge has requested a vote on whether to rehear the

matter en banc. Fed. R. App. P. 35.

The petition for panel rehearing and the petition

for rehearing en banc are DENIED.

* The Honorable Donald W. Molloy, United States District

Judge for the District of Montana, sitting by designation.

App. 29

15 U.S.C. 1114(1) provides:

(1) Any person who shall, without the consent of the

registrant –

(a) use in commerce any reproduction, counterfeit,

copy, or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or

advertising of any goods or services on or in connection

with which such use is likely to cause confusion, or to

cause mistake, or to deceive; or

(b) reproduce, counterfeit, copy, or colorably imitate a

registered mark and apply such reproduction, counterfeit, copy, or colorable imitation to labels, signs, prints,

packages, wrappers, receptacles or advertisements intended to be used in commerce upon or in connection

with the sale, offering for sale, distribution, or advertising of goods or services on or in connection with

which such use is likely to cause confusion, or to cause

mistake, or to deceive, shall be liable in a civil action

by the registrant for the remedies hereinafter provided. Under subsection (b) hereof, the registrant shall

not be entitled to recover profits or damages unless the

acts have been committed with knowledge that such

imitation is intended to be used to cause confusion, or

to cause mistake, or to deceive.

As used in this paragraph, the term “any person” includes the United States, all agencies and instrumentalities thereof, and all individuals, firms, corporations,

or other persons acting for the United States and with

the authorization and consent of the United States,

and any State, any instrumentality of a State, and any

App. 30

officer or employee of a State or instrumentality of a

State acting in his or her official capacity. The United

States, all agencies and instrumentalities thereof, and

all individuals, firms, corporations, other persons acting for the United States and with the authorization

and consent of the United States, and any State, and

any such instrumentality, officer, or employee, shall be

subject to the provisions of this chapter in the same

manner and to the same extent as any nongovernmental entity.

15 U.S.C. 1117 provides:

(a)

Profits; damages and costs; attorney fees

When a violation of any right of the registrant of a

mark registered in the Patent and Trademark Office, a

violation under section 1125(a) or (d) of this title, or a

willful violation under section 1125(c) of this title, shall

have been established in any civil action arising under

this chapter, the plaintiff shall be entitled, subject to

the provisions of sections 1111 and 1114 of this title,

and subject to the principles of equity, to recover (1)

defendant’s profits, (2) any damages sustained by the

plaintiff, and (3) the costs of the action. The court shall

assess such profits and damages or cause the same to

be assessed under its direction. In assessing profits the

plaintiff shall be required to prove defendant’s sales

only; defendant must prove all elements of cost or deduction claimed. In assessing damages the court may

enter judgment, according to the circumstances of the

App. 31

case, for any sum above the amount found as actual

damages, not exceeding three times such amount. If

the court shall find that the amount of the recovery

based on profits is either inadequate or excessive the

court may in its discretion enter judgment for such

sum as the court shall find to be just, according to the

circumstances of the case. Such sum in either of the

above circumstances shall constitute compensation

and not a penalty. The court in exceptional cases may

award reasonable attorney fees to the prevailing party.

(b)

Treble damages for use of counterfeit mark

In assessing damages under subsection (a) for any violation of section 1114(1)(a) of this title or section

220506 of Title 36, in a case involving use of a counterfeit mark or designation (as defined in section 1116(d)

of this title), the court shall, unless the court finds extenuating circumstances, enter judgment for three

times such profits or damages, whichever amount is

greater, together with a reasonable attorney’s fee, if the

violation consists of –

(1) intentionally using a mark or designation, knowing such mark or designation is a counterfeit mark (as

defined in section 1116(d) of this title), in connection

with the sale, offering for sale, or distribution of goods

or services; or

(2) providing goods or services necessary to the commission of a violation specified in paragraph (1), with

the intent that the recipient of the goods or services

would put the goods or services to use in committing

the violation.

App. 32

In such a case, the court may award prejudgment interest on such amount at an annual interest rate

established under section 6621(a)(2) of Title 26, beginning on the date of the service of the claimant’s

pleadings setting forth the claim for such entry of judgment and ending on the date such entry is made, or for

such shorter time as the court considers appropriate.

(c)

Statutory damages for use of counterfeit marks

In a case involving the use of a counterfeit mark (as

defined in section 1116(d) of this title) in connection

with the sale, offering for sale, or distribution of goods

or services, the plaintiff may elect, at any time before

final judgment is rendered by the trial court, to recover,

instead of actual damages and profits under subsection

(a), an award of statutory damages for any such use in

connection with the sale, offering for sale, or distribution of goods or services in the amount of –

(1) not less than $1,000 or more than $200,000 per

counterfeit mark per type of goods or services sold, offered for sale, or distributed, as the court considers

just; or

(2) if the court finds that the use of the counterfeit

mark was willful, not more than $2,000,000 per counterfeit mark per type of goods or services sold, offered

for sale, or distributed, as the court considers just.

(d) Statutory damages for violation of section

1125(d)(1)

In a case involving a violation of section 1125(d)(1) of

this title, the plaintiff may elect, at any time before

App. 33

final judgment is rendered by the trial court, to recover,

instead of actual damages and profits, an award of

statutory damages in the amount of not less than

$1,000 and not more than $100,000 per domain name,

as the court considers just.

(e)

Rebuttable presumption of willful violation

In the case of a violation referred to in this section, it

shall be a rebuttable presumption that the violation is

willful for purposes of determining relief if the violator,

or a person acting in concert with the violator, knowingly provided or knowingly caused to be provided materially false contact information to a domain name

registrar, domain name registry, or other domain name

registration authority in registering, maintaining, or

renewing a domain name used in connection with the

violation. Nothing in this subsection limits what may

be considered a willful violation under this section.

15 U.S.C. 1127 provides:

In the construction of this chapter, unless the contrary

is plainly apparent from the context –

The United States includes and embraces all territory

which is under its jurisdiction and control.

The word “commerce” means all commerce which may

lawfully be regulated by Congress.

The term “principal register” refers to the register provided for by sections 1051 to 1072 of this title, and the

App. 34

term “supplemental register” refers to the register provided for by sections 1091 to 1096 of this title.

The term “person” and any other word or term used to

designate the applicant or other entitled to a benefit or

privilege or rendered liable under the provisions of this

chapter includes a juristic person as well as a natural

person. The term “juristic person” includes a firm, corporation, union, association, or other organization capable of suing and being sued in a court of law.

The term “person” also includes the United States, any

agency or instrumentality thereof, or any individual,

firm, or corporation acting for the United States and

with the authorization and consent of the United

States. The United States, any agency or instrumentality thereof, and any individual, firm, or corporation

acting for the United States and with the authorization and consent of the United States, shall be subject

to the provisions of this chapter in the same manner

and to the same extent as any nongovernmental entity.

The term “person” also includes any State, any instrumentality of a State, and any officer or employee of a

State or instrumentality of a State acting in his or her

official capacity. Any State, and any such instrumentality, officer, or employee, shall be subject to the provisions of this chapter in the same manner and to the

same extent as any nongovernmental entity.

The terms “applicant” and “registrant” embrace the legal representatives, predecessors, successors and assigns of such applicant or registrant.

App. 35

The term “Director” means the Under Secretary of

Commerce for Intellectual Property and Director of the

United States Patent and Trademark Office.

The term “related company” means any person whose

use of a mark is controlled by the owner of the mark

with respect to the nature and quality of the goods or

services on or in connection with which the mark is

used.

The terms “trade name” and “commercial name” mean

any name used by a person to identify his or her business or vocation.

The term “trademark” includes any word, name, symbol, or device, or any combination thereof –

(1)

used by a person, or

(2) which a person has a bona fide intention to use in

commerce and applies to register on the principal register established by this chapter, to identify and distinguish his or her goods, including a unique product,

from those manufactured or sold by others and to indicate the source of the goods, even if that source is unknown.

The term “service mark” means any word, name, symbol, or device, or any combination thereof –

(1)

used by a person, or

(2) which a person has a bona fide intention to use in

commerce and applies to register on the principal register established by this chapter, to identify and distinguish the services of one person, including a unique

App. 36

service, from the services of others and to indicate the

source of the services, even if that source is unknown.

Titles, character names, and other distinctive features

of radio or television programs may be registered as

service marks notwithstanding that they, or the programs, may advertise the goods of the sponsor.

The term “certification mark” means any word, name,

symbol, or device, or any combination thereof –

(1)

used by a person other than its owner, or

(2) which its owner has a bona fide intention to permit a person other than the owner to use in commerce

and files an application to register on the principal register established by this chapter, to certify regional or

other origin, material, mode of manufacture, quality,

accuracy, or other characteristics of such person’s

goods or services or that the work or labor on the goods

or services was performed by members of a union or

other organization.

The term “collective mark” means a trademark or service mark –

(1) used by the members of a cooperative, an association, or other collective group or organization, or

(2) which such cooperative, association, or other collective group or organization has a bona fide intention

to use in commerce and applies to register on the principal register established by this chapter, and includes

marks indicating membership in a union, an association, or other organization.

App. 37

The term “mark” includes any trademark, service

mark, collective mark, or certification mark.

The term “use in commerce” means the bona fide use

of a mark in the ordinary course of trade, and not made

merely to reserve a right in a mark. For purposes of

this chapter, a mark shall be deemed to be in use in

commerce –

(1)

on goods when –

(A) it is placed in any manner on the goods or their

containers or the displays associated therewith or on

the tags or labels affixed thereto, or if the nature of the

goods makes such placement impracticable, then on

documents associated with the goods or their sale, and

(B) the goods are sold or transported in commerce,

and

(2) on services when it is used or displayed in the sale

or advertising of services and the services are rendered

in commerce, or the services are rendered in more than

one State or in the United States and a foreign country

and the person rendering the services is engaged in

commerce in connection with the services.

A mark shall be deemed to be “abandoned” if either of

the following occurs:

(1) When its use has been discontinued with intent

not to resume such use. Intent not to resume may be

inferred from circumstances. Nonuse for 3 consecutive

years shall be prima facie evidence of abandonment.

“Use” of a mark means the bona fide use of such mark

App. 38

made in the ordinary course of trade, and not made

merely to reserve a right in a mark.

(2) When any course of conduct of the owner, including acts of omission as well as commission, causes the

mark to become the generic name for the goods or services on or in connection with which it is used or otherwise to lose its significance as a mark. Purchaser

motivation shall not be a test for determining abandonment under this paragraph.

The term “colorable imitation” includes any mark

which so resembles a registered mark as to be likely to

cause confusion or mistake or to deceive.

The term “registered mark” means a mark registered

in the United States Patent and Trademark Office under this chapter or under the Act of March 3, 1881, or

the Act of February 20, 1905, or the Act of March 19,

1920. The phrase “marks registered in the Patent and

Trademark Office” means registered marks.

The term “Act of March 3, 1881”, “Act of February 20,

1905”, or “Act of March 19, 1920”, means the respective

Act as amended.

A “counterfeit” is a spurious mark which is identical

with, or substantially indistinguishable from, a registered mark.

The term “domain name” means any alphanumeric

designation which is registered with or assigned by

any domain name registrar, domain name registry, or

other domain name registration authority as part of

an electronic address on the Internet.

App. 39

The term “Internet” has the meaning given that term

in section 230(0(1) of Title 47.

Words used in the singular include the plural and vice

versa.

The intent of this chapter is to regulate commerce

within the control of Congress by making actionable

the deceptive and misleading use of marks in such

commerce; to protect registered marks used in such

commerce from interference by State, or territorial

legislation; to protect persons engaged in such commerce against unfair competition; to prevent fraud

and deception in such commerce by the use of reproductions, copies, counterfeits, or colorable imitations of

registered marks; and to provide rights and remedies

stipulated by treaties and conventions respecting

trademarks, trade names, and unfair competition entered into between the United States and foreign nations.

App. 40

[EXHIBIT 1 to COMPLAINT FOR DAMAGES

AND INJUNCTIVE RELIEF]

United States of America

United States Patent and Trademark Office

EYE DEW

Reg. No. 4,706,079

Registered

Mar. 24, 2015

Int. Cl.: 3

TRADEMARK

PRINCIPAL

REGISTER

ARCONA, INC (CALIFORNIA

CORPORATION)

28745 INDUSTRY DR.

VALENCIA, CA 91355

FOR: COSMETIC CREAMS

FOR SKIN CARE; COSMETIC

PREPARATIONS FOR SKIN

RENEWAL; EYE CREAM;

NON-MEDICATED STIMULATING LOTIONS FOR THE

SKIN; SKIN CONDITIONING

CREAMS FOR COSMETIC

PURPOSES; SKIN MOISTURIZER; WRINKLE REMOVING

SKIN CARE PREPARATIONS, IN CLASS 3 (U.S.

CLS. 1, 4, 6, 50, 51 AND 52).

FIRST USE 1-1-2002; IN

COMMERCE 1-1-2002.

THE MARK CONSISTS OF

STANDARD CHARACTERS

WITHOUT CLAIM TO ANY

PARTICULAR FONT, STYLE,

SIZE, OR COLOR.

NO CLAIM IS MADE TO THE

EXCLUSIVE RIGHT TO USE

App. 41

“EYE”, APART FROM THE

MARK AS SHOWN.

SER. NO. 85-601,826, FILED

4-18-2012.

MARK SPARACINO, EXAMINING ATTORNEY

[SEAL]

/s/ Michelle K. Lee

Director of the United States

Patent and Trademark Office

REQUIREMENTS TO MAINTAIN YOUR

FEDERAL TRADEMARK REGISTRATION

WARNING: YOUR REGISTRATION WILL BE

CANCELLED IF YOU DO NOT FILE

THE DOCUMENTS BELOW DURING

THE SPECIFIED TIME PERIODS.

Requirements in the First Ten Years*

What and When to File:

First Filing Deadline: You must file a Declaration of Use (or Excusable Nonuse) between the 5th

and 6th years after the registration date. See 15

U.S.C. §§1058, 1141k. If the declaration is accepted, the registration will continue in force for

the remainder of the ten-year period, calculated

from the registration date. unless cancelled by an

order of the Commissioner for Trademarks or a

federal court.

App. 42

Second Filing Deadline: You must file a Declaration of Use (or Excusable Nonuse) and an Application for Renewal between the 9th and 10th

years after the registration date.*

See 15 U.S.C. §1059.

Requirements in Successive Ten-Year Periods*

What and When to File:

You must file a Declaration of Use (or Excusable

Nonuse) and an Application for Renewal between

every 9th and 10th-year period, calculated from

the registration date.*

Grace Period Filings*

The above documents will be accepted as timely if filed

within six months after the deadlines listed above with

the payment of an additional fee.

*ATTENTION MADRID PROTOCOL REGISTRANTS: The holder of an international registration with an extension of protection to the United

States under the Madrid Protocol must timely file the

Declarations of Use (or Excusable Nonuse) referenced

above directly with the United States Patent and

Trademark Office (USPTO). The time periods for filing

are based on the U.S. registration date (not the international registration date). The deadlines and grace

periods for the Declarations of Use (or Excusable Nonuse) are identical to those for nationally issued registrations. See 15 U.S.C. §§1058, 1141k. However, owners

of international registrations do not file renewal applications at the USPTO. Instead, the holder must file a

renewal of the underlying international registration at

App. 43

the International Bureau of the World Intellectual

Property Organization, under Article 7 of the Madrid

Protocol, before the expiration of each ten-year term

of protection, calculated from the date of the international registration. See 15 U.S.C. §1141j. For more information and renewal forms for the international

registration, see http://www.wipoinUmadrid/en/.

NOTE: Fees and requirements for maintaining

registrations are subject to change. Please check

the USPTO website for further information.

With the exception of renewal applications for

registered extensions of protection, you can file

the registration maintenance documents referenced above online at http://www.uspto.gov.

NOTE: A courtesy e-mail reminder of USPTO

maintenance filing deadlines will be sent to

trademark owners/holders who authorize e-mail

communication and maintain a current e-mail

address with the USPTO. To ensure that e-mail

is authorized and your address is current,

please use the Trademark Electronic Application System (TEAS) Correspondence Address

and Change of Owner Address Forms available

at http://www.uspto.gov.