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Red River Bancshares Inc. v. Red River Employees Federal Credit Union

United States District Court, W.D. Louisiana, Shreveport Division

September 26, 2018

RED RIVER BANCSHARES INC., RED RIVER BANK LSCB
v.
RED RIVER EMPLOYEES FEDERAL CREDIT UNION

          S. MAURICE HICKS, JR. JUDGE

          MEMORANDUM RULING

          HORNSBY MAGISTRATE JUDGE

         Before the Court is a Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) filed by Defendant Red River Employees Federal Credit Union (“Credit Union”). See Record Document 11. Plaintiffs Red River Bancshares, Inc., (“Bancshares”) and Red River Bank, LSCB (“RRB”) oppose the motion. See Record Document 14. For the reasons set forth below, the Credit Union's Rule 12(b)(6) Motion to Dismiss (Record Document 11) is hereby DENIED.

         BACKGROUND

         Bancshares, and its licensee, RRB, are Louisiana entities engaged in banking and financial services throughout Louisiana. See Record Document 13 at ¶¶ 1-2, 7. Since 1999, Bancshares, through RRB, has used the service mark “RED RIVER BANK” in connection with its banking services. See id. at ¶ 8. As such, Bancshares and RRB assert that the name and service mark “Red River Bank” have become associated with Bancshares and RRB by consumers in Louisiana, especially in Caddo and Bossier Parish. See id. at ¶ 9.

         Bancshares is the owner of United States Trademark No. 2, 418, 600 for “The Red River Logo” issued on January 9, 2001. See id. at ¶ 10, Ex. A. Bancshares is also the owner of United States Trademark No. 4, 586, 878 for the mark “RED RIVER BANK” issued on August 19, 2014. See id. at ¶¶ 13-14, Ex. B. Bancshares also owns a Louisiana Trademark for “Red River Bank” and corresponding logo. See id. at ¶ 15, Ex. C.

         The Credit Union traditionally provided credit union services in an around the Texarkana, Texas and Texarkana, Arkansas area, and did not provide services in Caddo or Bossier Parish, Louisiana. See id. at ¶¶ 16, 18. Around 2008, the Credit Union adopted the “Red River Credit Union” logo. See id. at ¶ 17. Prior to 2017, Plaintiffs and the Credit Union coexisted in their respective markets without confusion among their members, customers, or the general public. See id. at ¶ 21. However, on October 2, 2017, the Credit Union purchased branches from the now liquidated Shreveport Federal Credit Union, including branches in Caddo and Bossier Parish. See id. at ¶ 19. Since that time, the Credit Union has been operating branches in Caddo and Bossier Parish. See id. at ¶ 20. Plaintiffs allege that the Credit Union is targeting members and potential members in the same geographical areas served by RRB. See id. at ¶¶ 23-24. Plaintiffs claim that the Credit Union is aware of Bancshares and/or RRB's longstanding use of RED RIVER BANK in connection with banking services in Louisiana. See id. at ¶ 27.

         Plaintiffs' Original Complaint asserted the following claims against the Credit Union: (1) trademark infringement under section 32 of the Lanham Act (15 U.S.C. § 1114), (2) unfair competition under section 43(a) of the Lanham Act (15 U.S.C. § 1125(a)), (3) Louisiana trademark infringement under La. Rev. Stat. 51:211 et seq., and (4) Louisiana unfair trade practices under the Louisiana Unfair Trade Practices Act (“LUTPA”), La. Rev. Stat. 51:1401 et seq. See Record Document 1. The Credit Union responded by filing a Motion to Dismiss. See Record Document 11. Therein, the Credit Union argued that Bancshares is the exclusive owner of the trademark in question, and that RRB, a mere licensee of Bancshares, lacks the standing to assert claims under the Lanham Act or Louisiana's Trademark infringement statue. See id. The Credit Union also argued that as a federally insured financial institution, it is exempt from LUTPA pursuant to La. Rev. Stat. 51:1406(1). See id.

         Plaintiffs responded by filing an Amended Complaint that deletes their LUTPA claims. See Record Document 13 at ¶¶ 39-42.[1] The Amended Complaint also asserts that RRB is the “exclusive licensee” of Bancshares. See id. at ¶ 9. On the same day, Plaintiffs also filed an opposition to the Credit Union's Motion to Dismiss, arguing that as an exclusive licensee, RRB has standing to assert trademark claims. See Record Document 14. RRB also contends that as an exclusive licensee of Bancshares, it should be allowed to remain in the litigation as a permissive co-plaintiff pursuant to Fed.R.Civ.P. 20, or compulsory co-plaintiff pursuant to Fed.R.Civ.P. 19. See Id. Plaintiffs conclude their opposition by requesting that the Court deny the Credit Union's motion to dismiss as moot. See id.

         The Credit Union filed a reply brief, which significantly expands the legal arguments raised in the Motion to Dismiss. See Record Document 15. Therein, the Credit Union argues that its motion is not moot because the Amended Complaint contains the same defect - RRB's lack of standing. See id. at 3-7. Plaintiffs filed a sur- reply, which provides additional argument as to why RRB has standing to remain as a co-plaintiff. See Record Document 18 at 2-7. The Credit Union responded by filing a sur-sur-reply, which provides additional argument as to why RRB lacks standing, even as an exclusive licensee. See Record Document 23.

         LAW AND ANALYSIS

         I. Effect of Amended Complaint on Previously Filed Motion to Dismiss

          Amended pleadings generally supersede prior pleadings. See United States ex rel Curtin v. Barton Malow Co., No. 14-2584, 2017 WL 2453032, at *2 n. 5 (W.D. La. June 6, 2017). An Amended Complaint renders the Original Complaint of no legal effect unless the Original Complaint is specifically referenced or incorporated into the Amended Complaint. See King v. Dogan, 31 F.3d 344, 346 (5th Cir. 1994). The appropriate course of action when a motion to dismiss is pending against a superseded complaint is to deny the motion as moot. See Garza-Selcer v. 1600 Pacific Subtenant, LLC, No. 15-3791, 2016 WL 11474103, at *2 (N.D. Tex. Aug. 30, 2016); Michael v. Boutwell, No. 14-0116, 2015 WL 728516, at *4-5 (N.D. Miss. Feb. 19, 2015). However, if a defect in a superseded pleading reappears in an amended pleading, the court may treat a previously filed motion to dismiss as if it is directed at the amended complaint. See Curtin, 2017 WL 2453032 at *2 n. 5.

         In this instance, Plaintiffs' Amended Complaint deletes their LUTPA claims and changes RRB's relationship with Bancshares from a “licensee” to “exclusive licensee.” See Record Documents 1 and 13. Otherwise, the Amended Complaint is substantially similar to the Original Complaint. The Amended Complaint does not incorporate the Original Complaint by reference. The Credit Union argues that the Amended Complaint contains the same alleged defect ...


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