National Grange v. California State Grange ( 2018 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS MAR 22 2018
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
NATIONAL GRANGE OF THE ORDER No. 15-17179
OF PATRONS OF HUSBANDRY,
D.C. No.
Plaintiff-counter- 2:14-cv-00676-WBS-DAD
defendant-Appellee,
v. MEMORANDUM*
CALIFORNIA STATE GRANGE,
Defendant-counter-claimant-
Appellant.
NATIONAL GRANGE OF THE ORDER No. 15-17274
OF PATRONS OF HUSBANDRY,
D.C. No.
Plaintiff-counter- 2:14-cv-00676-WBS-DAD
defendant-Appellant,
v.
CALIFORNIA STATE GRANGE,
Defendant-counter-claimant-
Appellee.
NATIONAL GRANGE OF THE ORDER No. 16-16826
OF PATRONS OF HUSBANDRY,
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
D.C. No.
Plaintiff-counter- 2:14-cv-00676-WBS-AC
defendant-Appellee,
v.
CALIFORNIA STATE GRANGE,
Defendant-counter-claimant-
Appellant.
Appeal from the United States District Court
for the Eastern District of California
William B. Shubb, District Judge, Presiding
Argued and Submitted February 16, 2018
San Francisco, California
Before: KLEINFELD and TALLMAN, Circuit Judges, and MURPHY,** District
Judge.
The California State Grange, now the California Guild (“Guild”), appeals
the adverse summary judgment in a trademark infringement and unfair competition
action brought by the National Grange of the Order of Patrons of Husbandry
(“National Grange”). The Guild also appeals the district court’s award of
attorneys’ fees to the National Grange. The National Grange cross-appeals as to
the scope of the permanent injunction. We have jurisdiction under 28 U.S.C.
§ 1291 and affirm.
**
The Honorable Stephen J. Murphy, III, United States District Judge
for the Eastern District of Michigan, sitting by designation.
2
1. The district court did not abuse its discretion by rejecting the Guild’s
acquiescence defense. Seller Agency Council, Inc. v. Kennedy Ctr. for Real Estate
Educ., Inc., 621 F.3d 981, 986 (9th Cir. 2010). The National Grange revoked
Defendant’s charter in April 2013. The Guild then declared in November 2013
that it was disaffiliating from the national organization. The National Grange sent
a cease and desist letter the following month—demanding that the Guild stop using
its trademarks—but Defendant continued calling itself the “California State
Grange.” In March 2014, the National Grange filed this action.
Far from conveying implied consent, id. at 988, the National Grange moved
quickly to attack the Guild’s infringing conduct once it “knew of facts giving it
notice of its trademark [infringement] cause of action,” Westinghouse Elec. Corp.
v. Gen. Circuit Breaker & Elec. Supply Inc., 106 F.3d 894, 899 (9th Cir. 1997)
(citation omitted). The National Grange thus did not acquiesce in Defendant’s
infringing use of its marks.
2. The district court also acted within its discretion by declining to impose a
broader permanent injunction. See 15 U.S.C. § 1116; SEC v. Interlink Data
Network of L.A., Inc., 77 F.3d 1201, 1204 (9th Cir. 1996). The district court
enjoined the Guild from using the word “Grange”—including references to its past
affiliation with the National Grange—but refused to bar Defendant from using the
word “Granger” and the acronyms “CSG” and “CG.” The court reasoned (1) the
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complaint did not allege that “Granger” and acronyms like “CSG” are confusingly
similar to the “Grange” mark, or even that Defendant had used those terms; and
(2) summary judgment was limited to infringing use of the word “Grange.”
Declining to impose a permanent injunction that would have exceeded the scope of
the complaint and summary judgment order was not an abuse of discretion.
3. Neither was awarding attorneys’ fees to the National Grange an abuse of
discretion. See 15 U.S.C. § 1117(a); SunEarth, Inc. v. Sun Earth Solar Power Co.,
839 F.3d 1179, 1181 (9th Cir. 2016) (en banc). The district court held that the case
was “exceptional” under the Lanham Act because Defendant had willfully violated
the permanent injunction. See § 1117(a). Although the Guild had notice of the
prohibited conduct in July 2015, Defendant was—as of April 2016—still calling
itself the “California State Grange” in its business activities, corporate name,
business directory listings, and email address on the California Secretary of State’s
website. The Guild had plenty of time to comply with the injunction, but chose not
to do so. There was also evidence the Guild’s infringing conduct had deceived
numerous members of the National Grange.
SunEarth does not change our conclusion. Although that decision overruled
the “malicious, fraudulent, deliberate, or willful” test while this case was on
appeal, it imposed a less stringent “totality of the circumstances” standard.
SunEarth, 839 F.3d at 1180–81 (citations omitted). SunEarth also lowered the
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burden of proof from clear and convincing evidence to a preponderance of the
evidence. Id. at 1181. Because the National Grange carried its burden of showing
the Guild deliberately violated the injunction under the prior test, Plaintiff has also
satisfied SunEarth’s relaxed “totality of the circumstances” standard. See id.1
Each party shall bear its own costs on appeal.
AFFIRMED.
1
The Guild failed to establish a genuine issue of material fact regarding the claim
that the National Grange’s mark was not protectable because it was merely
descriptive and lacked secondary meaning. The only evidence that the Guild
presented on this point was a dictionary entry indicating that “grange” means “a
farm with its nearby buildings” and “Grange” means “a lodge or local branch of a
farmers’ association in the U.S,” and another dictionary entry indicating that
“GRANGE” means a “farm furnished with barns, granaries, stables, and all
conveniences for husbandry.”
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