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Ballero v. 727 Inc.

United States District Court, E.D. Louisiana

March 28, 2017

FRANK W. BALLERO
v.
727 INC., ET AL.

         SECTION "B"(3)

          ORDER AND REASONS

         Before the Court are two motions: Defendants 727, Incorporated and 721 Bourbon, Inc.'s “Motion to Dismiss Amended Complaint” (Rec. Doc. 24) and Defendant Crescent Crown Distributing, LLC's “Motion to Dismiss” (Rec. Doc. 30). Plaintiff timely filed responses to both motions. Rec. Docs. 32-33. Defendants then requested, and were granted, leave to file reply memoranda. Rec. Docs. 36, 40. For the reasons discussed below, IT IS ORDERED that the motions to dismiss (Rec. Docs. 24, 30) are DENIED WITHOUT PREJUDICE.

         I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

         As previously discussed, this case arises out of the sale of a red ale beer known as Pirate's Blood. Rec. Doc. 1 at ¶ 5. Frank W. Ballero (“Plaintiff”) claims that he invented and began brewing the beer in 2009. Id. He also developed a “logo and mark” for the beer. Id. The beer was subsequently sold by various bars, including the Funky Pirate located at 727 Bourbon Street, New Orleans, Louisiana 70116 and owned by 727, Incorporated (“Defendant 727”) and Tropical Isle Bourbon located at 721 Bourbon Street, New Orleans, Louisiana 70116 and owned by 721 Bourbon, Incorporated (“Defendant 721”). Id.; see also Rec. Doc. 8-1 at 1 n.1.

         In March of 2011, Plaintiff stopped producing Pirate's Blood. Rec. Doc. 1 at ¶ 6. Yet, the Funky Pirate and Tropical Isle Bourbon continued to sell a beer called “Pirate's Blood, ” “use the same exact tap handle bearing [Plaintiff's] Pirate's Blood logo and name, ” and tell customers that the beer “is locally brewed and sold exclusively” at these two bars. Id.

         According to Plaintiff, the beer “passing off as Pirate's Blood” is sold and distributed by Defendant Crescent Crown Distributing, LLC (“Defendant Crescent”). Id. at ¶ 7. Plaintiff maintains that Defendant Crescent regularly visits the Funky Pirate and Tropical Isle Bourbon “to maintain and clean the equipment associated with the product it has sold, i.e. the beer tap lines, ” and therefore is “complicit in the deception.” Id.

         Consequently, on November 4, 2016, Plaintiff filed suit requesting injunctive and monetary relief pursuant to § 43(a) of the Lanham Act, 15 U.S.C. §§ 1125(a), 1116, 1117, and the Louisiana Unfair Trade Practices Act (“LUTPA”), Louisiana Revised Statute § 51:1401-1428.[1] Rec. Doc. 1 at ¶¶ 12, 15.

         In response to Defendants' original motions to dismiss (Rec. Docs. 8, 15), Plaintiff filed an amended complaint on February 2, 2017 asserting that he “met with various persons and companies in 2012, 2013, 2014, and 2015 regarding the production and sale of Pirate's Blood” and that he “fully intended/intends to continue brewing and selling Pirate's Blood under its trademarked name and logo” (Rec. Doc. 21). Before the Court could rule on the original motions to dismiss, Defendants 727 and 721 filed a second motion to dismiss in response to the amended complaint. Rec. Doc. 24. Nonetheless, Defendants' original motions were denied without prejudice on February 22, 2017. Rec. Doc. 29. The Court specifically stated that “Plaintiff's amended complaint appears to allege that he intended to continue to use and/or resume using his mark and therefore alleges that he did not abandon the mark. Arguments to the contrary will be considered in conjunction with the pending motion to dismiss filed by Defendants 721 and 727 . . . .” Id. at 6. Defendant Crescent then filed its second motion to dismiss. Rec. Doc. 30.

         II. THE PARTIES' CONTENTIONS

         As they did in their original motions, Defendants 727 and 721 argue that “Plaintiff ceased using the ‘Pirate's Blood' mark nearly six (6) years ago with no intent to resume use of the mark within the reasonably foreseeable future; and, therefore, abandoned the mark.” Rec. Doc. 24 at 1. Because Plaintiff's claims for unfair competition under the LUTPA and for common law trademark infringement, false designation of origin, and unfair competition all require Plaintiff to own a protectable trademark, Defendants maintain that Plaintiff failed to state a claim upon which relief can be granted. Rec. Doc. 24-1 at 1-2. Defendant Crescent essentially adopts the arguments made by its co-Defendants. Rec. Doc. 30-1 at 1.[2]

         Plaintiff responds that “he intended and continues to use the Pirate's Blood formula with its associated logo, ” as evidenced by his negotiations in 2012, 2013, 2014, and 2015 with individuals and businesses “regarding the contract brewing of Pirate's Blood.” Rec. Doc. 33 at 4.

         III. LAW AND ANALYSIS

         Under Rule 12(b)(6) of the Federal Rules of Civil Procedure, a party can move to dismiss a complaint for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6); see also Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007). Such motions are viewed with disfavor and rarely granted. Lowrey v. Tex. A & M Univ. Sys., 117 F.3d 242, 247 (5th Cir. 1997) (quoting Kaiser Aluminum & Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir. 1982)). Nonetheless, “[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks omitted). A claim is facially plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. Further, when reviewing a motion to dismiss, courts must accept all well-pleaded facts as true and view them in the light most favorable to the non-moving party. See Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996).

         According to Defendants, to file a claim for federal and common law trademark infringement, false designation of origin, federal unfair competition, and unfair competition under the LUTPA, Plaintiff must have a valid protectable trademark. Rec. Doc. 24-1 at 3-4 (citing Am. Rice, Inc. v. Producers Rice Mill,Inc., 518 F.3d 321, 329 (5th Cir. 2008) (“To recover on a claim of trademark infringement, a plaintiff must first show that the mark is legally protectable and must then establish infringement by showing a likelihood of confusion. To be protectable, a mark must be distinctive, either inherently or by achieving secondary meaning in the mind of the public”) (internal citations omitted); Action Ink, Inc. v. Anheuser-Busch, Inc., 959 F.Supp.2d 934, 948 (E.D. La. 2013), aff'd sub nom. Action Ink, Inc. v. N.Y. Jets,L.L.C., ...


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