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Kische USA LLC v. Simsek

United States District Court, W.D. Washington, Seattle

November 29, 2017

KISCHE USA LLC, Plaintiff,
v.
ALI SIMSEK, et al., Defendants.

          ORDER DENYING PLAINTIFF'S SECOND MOTION FOR SUMMARY JUDGMENT

          JAMES L. ROBART UNITED STATES DISTRICT JUDGE.

         I.INTRODUCTION

         Before the court is Plaintiff Kische USA LLC's (“Kische”) second motion for summary judgment.[1] (2d MSJ (Dkt. # 101).) Defendants oppose the motion. (2d MSJ Resp. (Dkt. # 107).) The court has considered the motion, the parties' submissions in favor of and in opposition to the motion, the relevant portions of the record, and the applicable law. Being fully advised, [2] the court DENIES Kische's motion for the reasons set forth below.

         II. BACKGROUND

         The court has extensively detailed the factual and procedural background of this case in numerous prior orders. (See, e.g., 6/29/16 Order (Dkt. # 39); 12/13/16 Order (Dkt. # 65); 2/22/17 Order (Dkt. # 74); 9/6/17 Order (Dkt. # 95); 11/2/17 Order (Dkt. # 115).) Thus, in this order, the court recounts only the facts salient to Kische's instant motion.

         Mehmet Uysal, who resides in Turkey, formed Kische in 2007. (Uysal Decl. (Dkt. # 103) at 2.)[3] Beginning at that time, Kische “designed, imported[, ] and sold clothing to prominent retailers in the United States, including Nordstrom, Haute Look, Winners, T.J. Maxx, Marshalls[, and] Ross.” (Id.) Kische contends that Mr. Simsek and Ms. Walker abused their positions as Kische managers to misappropriate Kische's assets and form JD Stellar, a competing business. (See Id. (stating that Mr. Simsek and Mr. Walker “worked as managers of Kische”); SAC (Dkt. # 75) ¶¶ 4.19, 4.23-4.26; 9/6/17 Order (concluding that Mr. Simsek breached duties that he owed to Kische as its manager).) Of particular relevance here, Kische contends that Defendants invalidly transferred and used two trademarks of which Kische is “the senior user and owner”: (1) Kische word mark # 682 (“the Kische Mark”), and (2) Marseille design mark # 455 (“the Marseille Mark”) (collectively, “the Marks”).[4] (2d MSJ at 6 (citing SAC ¶¶ 4.9, Ex. 6 (Dkt. # 75-1) at 35-36 (“Kische Reg.”), 4.10, Ex. 7 (Dkt. # 75-1) at 37-38 (“Marseille Reg.”)).) On this basis, Kische claims that Defendants infringed the marks in violation of the Lanham Act, 15 U.S.C. § 1114, and common law. (SAC ¶¶ 5.1-6.7.)

         Kische registered the Marseille Mark on May 17, 2011, and the Kische Mark on August 5, 2014, with the United States Patent and Trademark Office (“USPTO”). (See Kische Reg.; Marseille Reg.) The registrations state that Kische first used the Kische Mark in 2007 and the Marseille Mark in 2010. (See Kische Reg.; Marseille Reg.) According to Mr. Uysal, Kische “used its trademarks in commerce in Washington State, as well as regionally across the United States through its shipments and distributions to major retailers.” (Uysal Decl. at 2; see also Simsek Decl. (Dkt. # 108) ¶ 8 (agreeing that Kische sold clothing under the Marks).) Kische's sale of clothing with the Marks “grossed annual sales of $13 million” in 2011. (Uysal Decl. at 1.) Kische promoted the clothing bearing the Marks “through the internet, email and print advertising, word of mouth, showrooms, tradeshows, retail agents, and at clothing showcase events.” (Id. at 2.)

         On March 13, 2014, Mr. Simsek-while he was still Kische's manager- facilitated the assignment of the Marseille Mark to JD Stellar.[5] (See SAC ¶ 4.23, Ex. 18 (Dkt. # 75-1) (“Assignment”) at 55.) After the assignment, JD Stellar filed for federal trademark protection of a Marseille word mark. (See SAC ¶ 4.30, Ex. 25 at 6.) The registration stated that the mark had first been used on June 20, 2010. (Id.) The word mark was registered to JD Stellar on July 7, 2015. (Id.; Simsek Decl. ¶ 22, Ex. F.) Citing two purchase orders from JD Stellar to TJ Maxx in 2014, Kische contends that after the transfer and redesign of the Marseille Mark, JD Stellar used the mark in connection with selling its goods. (2d MSJ at 9 (citing Herschlip Decl. (Dkt. # 102) at 2, Exs. F, G).) Kische also contends that JD Stellar used the Kische Mark to “sell clothing goods[] and solicit sales” by using the mark in emails to customers. (Id. at 12 (citing Mitchell Decl. (Dkt. # 104) at 2, Exs. D-F).)

         Defendants' version of events does not differ significantly from Kische's.[6]However, Defendants maintain that “Kische has not delivered a single clothing order since 2014” (2d MSJ Resp. at 6 (citing Simsek Decl. ¶ 13, Ex. B); but see Id. at 8 (stating that “[t]he last shipment of Kische's Marseille mark clothing was February 26, 2014, and the last shipment of Kische's Kische mark clothing . . . was May 28, 2016”)) and that JD Stellar never sold or advertised any clothing bearing the Kische Mark (Simsek Decl. ¶ 17). Defendants further aver that the Kische Mark was the more popular of the Marks and accounted for at least 90 percent of Kische's sales prior to 2014. (Id. ¶ 8.) Defendants contend that Kische sold only small quantities of the Marseille Mark “primarily to select Canadian customers.” (Id. ¶ 9.) Mr. Simsek attests that Mr. Uysal's goal was to turn the Kische Mark “into an internationally known brand” and that Mr. Uysal disfavored the Marseille Mark as a result. (Id. ¶ 8.) Mr. Simsek further states that the Marseille Mark has also made up only a small percentage of JD Stellar's sales, while the “vast majority” of JD Stellar's sales have come from its Dantelle mark. (Id. ¶ 20, Ex. D.) Defendants maintain that JD Stellar stopped selling any clothing under the Marseille Mark after they received a cease-and-desist letter from Kische's counsel on September 11, 2015. (Id. ¶ 26.)

         Kische now seeks summary judgment on its claims that Defendants infringed the Marks. (See 2d MSJ at 15-28; SAC ¶¶ 5.1-5.7 (alleging trademark infringement in violation of 15 U.S.C. § 1114), 6.1-6.7 (alleging common law trademark infringement).)

         III. ANALYSIS

         A. Legal Standard

         Summary judgment is appropriate if the evidence 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); see Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Galen v. Cty. of L.A., 477 F.3d 652, 658 (9th Cir. 2007). A fact is “material” if it might affect the outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is “‘genuine' only if there is sufficient evidence for a reasonable fact finder to find for the non-moving party.” Far Out Prods., Inc. v. Oskar, 247 F.3d 986, 992 (9th Cir. 2001) (citing Anderson, 477 U.S. at 248-49).

         The moving party bears the initial burden of showing there is no genuine dispute of material fact and that it is entitled to prevail as a matter of law. Celotex, 477 U.S. at 323. If the moving party does not bear the ultimate burden of persuasion at trial, it can show the absence of such a dispute in two ways: (1) by producing evidence negating an essential element of the nonmoving party's case, or (2) by showing that the nonmoving party lacks evidence of an essential element of its claim or defense. Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d 1099, 1106 (9th Cir. 2000). If the moving party will bear the burden of persuasion at trial, it must establish a prima facie showing in support of its position on that issue. UA Local 343 v. Nor-Cal Plumbing, Inc., 48 F.3d 1465, 1471 (9th Cir. 1994). That is, the moving party must present evidence that, if uncontroverted at trial, would entitle it to prevail on that issue. Id. at 1473. If the moving party meets its burden of production, the burden then shifts to the nonmoving party to identify specific facts from which a fact finder could reasonably find in the nonmoving party's favor. Celotex, 477 U.S. at 324; Anderson, 477 U.S. at 252.

         The court is “required to view the facts and draw reasonable inferences in the light most favorable to the [nonmoving] party.” Scott v. Harris, 550 U.S. 372, 378 (2007). The court may not weigh evidence or make credibility determinations in analyzing a motion for summary judgment because those are “jury functions, not those of a judge.” Anderson, 477 U.S. at 249-50. Nevertheless, the nonmoving party “must do more than simply show that there is some metaphysical doubt as to the material facts . . . . Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue for trial.” Scott, 550 U.S. at 380 (internal quotation marks omitted) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87 (1986)).

         B. Second Motion for Summary Judgment

         As a threshold issue, Defendants take issue with the fact that this motion is Kische's second motion for summary judgment. (2d MSJ Resp. at 5.) District courts have discretion to entertain second motions for summary judgment. Hoffman v. Tonnemacher, 593 F.3d 908, 909 (9th Cir. 2010). The Ninth Circuit has stated that “allowing a party to file a second motion for summary judgment is logical, and it fosters the ‘just, speedy, and inexpensive' resolution of suits.” Id. at 911 (quoting Fed.R.Civ.P. 1); see also Id. at 912 (“Allowing a successive summary judgment motion potentially can save all concerned the far greater expenses of a trial.”). However, the Ninth Circuit also cautioned that district courts should “weed out frivolous or simply repetitive motions.” Id. In exercising its discretion on this question, a district court may consider the following factors: “‘(1) an intervening change in controlling law; (2) the availability of new evidence or an expanded factual record; and (3) [the] need to correct a clear error or prevent manifest injustice.'” Brazill v. Cal. Northstate Coll. of Pharm., LLC, No. CIV. 2:12-1218 WBS GGH, 2013 WL 4500667, at *1 (E.D. Cal. Aug. 22, 2013) (quoting Whitford v. Boglino, 63 F.3d 527, 530 (7th Cir. 1995)).

         Although Defendants contest Kische's filing of a second motion for summary judgment, the court will consider the motion in the interest of judicial efficiency. (2d MSJ Resp. at 5.) Even though many of the underlying facts and issues are the same as in Kische's first motion, the second motion is not patently frivolous or simply repetitive. See Hoffman, 593 F.3d at 911. Moreover, the first motion for summary judgment involved the breach and duty elements of Kische's breach of contract and fiduciary duty claims against Mr. Simsek, whereas this motion involves Kische's trademark infringement claims. (Compare 1st MSJ (Dkt. # 85), with 2d MSJ.)

         However, if left unchecked, repetitive motions practice can create significant costs and expend considerable court resources. Thus, the court orders any party wishing to file an additional dispositive motion to first seek the court's leave. See Fed. R. Civ. P. 56(b) (stating that “[u]nless a different time is set by local rule or the court orders otherwise, a party may file a motion for summary judgment at any time until 30 days after the close of all discovery”); (see also Sched. Order (Dkt. # 78) at 1 (setting the dispositive motions deadline as January 9, 2018).) A party's failure to seek the court's leave will result in the court striking the dispositive motion as improperly filed.

         C. Kische's Motion

         As presented in its motion, Kische seeks summary judgment on four issues: (1) that Kische had valid common law and federal trademark rights in the Marks; (2) that Mr. Simsek's transfer of the Marseille Mark was invalid and should be reversed; (3) that Defendants infringed on the Marks by causing a likelihood of consumer confusion; and (4) that Defendants knowingly and willfully infringed on the Marks.[7] (2d MSJ at 6.) As a preliminary matter, Defendants argue Kische's motion is so confused and unclear that they cannot properly respond to it. (See 2d MSJ Resp. at 5.) But Defendants exaggerate the severity of any ineloquence in Kische's motion. Although Kische does not expressly state that it seeks summary judgment on its trademark infringement claims-instead stating that it requests judgment in its favor on the issues of whether it had rights in the Marks and whether Defendants infringed on the Marks by causing a likelihood of consumer confusion-Kische's motion adequately informs Defendants and the court of Kische's arguments. (See 2d MSJ at 14 (using the subheading “JD Stellar Has Committed Federal Trademark Infringement In Violation of 15 U.S.C. § 1114”); see also 2d MSJ Resp. at 13-25 (contesting the entry of summary judgment on the trademark infringement claims).) Indeed, those two “issues” comprise the two elements of a trademark infringement claim under both Section 32 of the Lanham Act and common law.[8]See Applied Info. Scis. Corp. v. eBay, Inc., 511 F.3d 966, 969 (9th Cir. 2007) (stating that a plaintiff asserting a trademark infringement claim must prove that (1) it has valid, protectable trademarks, and (2) the defendant's use of the marks in commerce is likely to ...


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