United States District Court, W.D. Virginia, Harrisonburg Division
Michael F. Urbanski United States District Judge.
matter comes before the court on Plaintiff Virginia
Industrial Plastics, Inc.'s (VIP) motion to dismiss
Defendant Cabinet Saver LLC's (CS) counterclaims pursuant
to Federal Rule of Civil Procedure 12(b)(6), filed on
November 19, 2018. CS has filed no response to this motion.
reasons explained below, die court GRANTS
VIP's motion to dismiss CS's counterclaims.
filed its complaint against CS on September 12, 2018. ECF No.
1. This suit arises from the use of die name "Cabinet
Savers," used by both parties to refer to plastic liners
designed to protect kitchen sink cabinets and other surfaces
from water damage. ECF No. 1, ¶ 13; ECF No. 7, 2. Both
parties manufacture products of this description. ECF No. 1,
¶ 13; ECF No. 7, 2. VIP owns United States Trademark
Registration No. 5, 426, 605 for the use of the "Cabinet
Saver" mark (the Mark), filed with the United States
Patent and Trademark Office (USPTO) on July 14, 2017. ECF No.
1, ¶ 7; ECF No. 7, 1. In its complaint, VIP alleges
trademark infringement, false association/false endorsement,
false designation of source and/or origin, and unfair
competition against CS. ECF No. 1.
answer to the complaint, CS brings two counterclaims:
trademark infringement by VIP and unfair competition by VIP.
ECF No. 7. CA claims that it was using the mark "Cabinet
Saver" in commerce before VIP began using it, and that
VIP knew of CS's use and "adopted the Mark in an
attempt to hijack the Mark, cause confusion as to the source
of goods and services provided under the Mark, and to
interfere with Cabinet Saver's use of the Mark." ECF
No. 7, 1.
12(b)(6) of the Federal Rules of Civil Procedure permits a
party to move for dismissal of a complaint for failure to
state a claim upon which relief can be granted. To survive a
motion to dismiss under Rule 12(b)(6), the plaintiff must
plead sufficient facts "to raise a right to relief above
the speculative level" and "state a claim to relief
that is plausible on its face." Bell Ad. Corp. v.
Twombly, 550 U.S. 544, 555, 570 (2007). A plaintiff
establishes "facial plausibility" by pleading
"factual content that allows the court to draw the
reasonable inference that the defendant is liable for the
misconduct alleged." Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009). In ruling on a 12(b)(6) motion, the
court must accept all well-pleaded allegations in the
complaint as true and draw all reasonable factual inferences
in the light most favorable to the plaintiff. Ibarra v.
United States, 120 F.3d 472, 474 (4th Cir. 1997).
However, "[t]hreadbare recitals of the elements of a
cause of action, supported by mere conclusory statements, do
not suffice." Iqbal, 556 U.S. at 678; see
Wag More Dogs, LLC v. Cozart, 680 F.3d 359, 365 (4th
Cir. 2012) (holding the court "need not accept legal
conclusions couched as facts or unwarranted inferences,
unreasonable conclusions, or arguments") (internal
quotation marks omitted).
complaint of fraud must be pled with particularity, according
to Rule 9(b). "To satisfy the heightened pleading
standard of Rule 9(b), a plaintiff must state with
particularity 'the time, place, and contents of the false
representations, as well as the identity of the person making
the misrepresentation and what he obtained
thereby.'" Beasley v. FV-I, Inc.,
1:13-CV-116, 2013 WL 1192018, at *3 (E.D.Va. Mar. 21, 2013)
(quoting In re Mut. Funds Inv. Litig., 566 F.3d 111,
120 (4th Cir. 2009)). Failure to comply with Rule 9(b)'s
pleading standard is treated as a failure to state a claim
under Rule 12(b)(6). Id. (quoting Harrison v.
Westinghouse Savannah River Co., 176 F.3d 776, 783 n. 5
(4th Cir. 1999)).
motion to dismiss, VIP argues that CS failed to meet the
standard set by Rule 9(b) by pleading the factual
circumstances of its counterclaims. ECF No. 16, 2. VIP also
argues that CS has failed to "establish a legally
cognizable cause of action" by failing to factually
"substantiate a bases for fraud" on the USPTO.
Id. The court's decision regarding the latter of
these two objections eliminates the need to address the
establish trademark infringement under the Lanham Act, a
plaintiff must prove: (1) that it owns a valid mark; (2) that
the defendant used the mark "in commerce" and
without the plaintiffs authorization; (3) that the defendant
used the mark (or an imitation of it) "in connection
with the sale, offering for sale, distribution, or
advertising" of goods or sendees; and (4) that the
defendant's use of the mark is likely to confuse
consumers. 15 U.S.C. § 1114(a) (2005): see Louis
Vuitton Malletier S.A. v. Haute Diggity Dog, LLC, 507
F.3d 252, 259 (4th Cir. 2007); People for the Ethical
Treatment of Animals v. Doughney, 263 F.3d 359, 364 (4th
Cir. 2001). None of these elements requires a showing of
fraud. In its first counterclaim of trademark infringement,
however, CS alleges that "VIP obtained a federal
trademark registration fraudulendy in that VIP fraudulently
alleged a date of first use of the Mark almost ten years
prior to its actual first use of the Mark, and for the sole
purpose of infringing on Cabinet Saver's Trademark
rights." ECF No. 7, 5. This claim merges the second
element of trademark infringement with an allegation of
fraud; in effect, CS alleges fraud in the procurement, and
such a claim is subject to the heightened standards of Rule
9(b). Republic Technologies (NA). LLC v. BBK Tobacco
& Foods, LLC, 262 F.Supp.3d 605, 608-09 (N.D. Ill.
state a cause of action for fraud, a plaintiff must plead
that there was "a false representation of a material
fact, made intentionally and knowingly, with intent to
mislead." Sales v. Kecoughtan Housing Co., Ltd,
279 Va. 475, 481, 690 S.E.2d 91, 94 (2010). The plaintiff
must also plead reliance on that false representation and
resulting damages. Id. Pleading fraud in die
procurement of a trademark requires proof die trademark owner
made a false representation of material fact to the USPTO,
and but for the USPTO's reliance on die false
representation, the registration would not have been issued.
eCash Technologies, Inc. v. Guagliardo, 136
F.Supp.2d 1056, 1064 (CD. Cal 2000).
clearest deficiency in its counterclaim is its allegation
that VIP "obtained a federal trademark registration
fraudulendy in that VIP's [sic] fraudulendy alleged a
date of first use of the Mark almost ten years prior to its
actual first use of the Mark, and for the sole purpose of
infringing on Cabinet Saver's trademark rights." ECF
No. 7, 5. CS's claim of trademark infringement,
therefore, rests upon VIP's alleged erroneous date of
first use. An erroneous date of first use, however, cannot be
the grounds for such a claim. The Trademark Trial and Appeal
Board (Trademark Board) has regularly ruled that "an
incorrect statement of the date of first use is not material,
and therefore not fraudulent, as long as the actual first use
occurred prior to the application date." See,
e.g.,Pony Exp. Courier Corp. of Am. v. Pony Exp.
Delivery Serv.,872 F.2d 317, 319 (9th Cir. 1989)
("The claim of a date of first use is not a material
allegation as long as the first use in fact preceded the
application date."); Lewis v. Microsoft Corp.,410 F.Supp.2d 432, 437-38 (E.D. N.C. 2006),
aff'd.222 Fed.Appx. 290 (4th Cir. 2007)
(finding trademark infringement claims were barred by res
judicata after the Trademark Board held that an
incorrect date of ...