Arizona Board of Regents v. John Doe ( 2022 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS MAY 13 2022
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
ARIZONA BOARD OF REGENTS, a body No. 21-16525
corporate, for and on behalf of: on behalf of
Arizona State University, D.C. No. 2:20-cv-01638-DWL
Plaintiff-Appellant,
MEMORANDUM*
v.
JOHN DOE, AKA asu_covid.parties, an
individual,
Defendant-Appellee,
and
FACEBOOK, INC., a Delaware corporation,
Defendant.
Appeal from the United States District Court
for the District of Arizona
Dominic Lanza, District Judge, Presiding
Argued and Submitted April 15, 2022
Pasadena, California
Before: CALLAHAN and VANDYKE, Circuit Judges, and Y. GONZALEZ
ROGERS,** District Judge.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable Yvonne Gonzalez Rogers, United States District Judge
Plaintiff-Appellant Arizona Board of Regents (“ABR”) appeals the district
court’s order denying ABR’s motion for default judgment and dismissal of its
complaint. ABR’s appeal raises six issues, namely whether the district court erred
by: (1) dismissing sua sponte its complaint without leave to amend and without
providing prior notice; (2) dismissing its Lanham Act and state law unfair
competition claims under Rule 12(b)(6); (3) refusing to apply the doctrine of initial
interest confusion; (4) dismissing its false advertising claim; (5) refusing to rule on
its state law dilution claim; and (6) denying its motion for default judgment. We
have jurisdiction over this appeal pursuant to 28 U.S.C. § 1291. After a review of
the record, oral argument, and relevant case law, we affirm the district court’s
order on all grounds.
“We review de novo a district court’s dismissal of [a complaint] for failure
to state a claim under Rule 12(b)(6).” Prodanova v. H.C. Wainwright & Co., LLC,
993 F.3d 1097, 1105 (9th Cir. 2021). Questions involving the application of legal
principles to established facts are also reviewed de novo. Flores v. City of San
Gabriel, 824 F.3d 890, 905 (9th Cir. 2016).
However, a district court’s determination of likelihood of confusion is
reviewed for clear error. Pom Wonderful LLC v. Hubbard, 775 F.3d 1118, 1123
(9th Cir. 2014). The denial of a motion for default judgment as well as the
for the Northern District of California, sitting by designation.
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decision whether to retain jurisdiction over supplemental claims when the original
federal claims are dismissed are reviewed for abuse of discretion. Aldabe v.
Aldabe, 616 F.2d 1089, 1092–93 (9th Cir. 1980); Lima v. United States Dep’t of
Educ., 947 F.3d 1122, 1125, 1128 (9th Cir. 2020).
1. The district court did not err by dismissing ABR’s complaint sua
sponte without leave to amend and without providing notice because amendment
would have been futile. See Wong v. Bell, 642 F.2d 359, 361–62 (9th Cir. 1981).
With respect to all of ABR’s claims, amendment would have been futile given the
implausibility of the allegations and of a finding of likelihood of confusion. Of
Doe’s eighteen posts included on the Instagram page, only one post included the
use of ABR’s mark and trade dress. That one post contained profanity and a
reasonable consumer would not think that a university would use such language
when addressing the public. Reviewing the posts in their totality does not change
the result, but rather reaffirms it.
Additionally, amendment would have also been futile given the non-
commercial nature of Doe’s activities. The Lanham Act was enacted to be applied
in the commercial context, thus “infringement claims are subject to a commercial
use requirement.” Bosley Med. Inst., Inc. v. Kremer, 403 F.3d 672, 676 (9th Cir.
2005). Here, the record does not support the conclusion that Doe used ABR’s
marks for the sale of goods or services. Rather, the record shows that Doe used the
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marks to criticize and mock ABR and ABR’s policies and administration. While
some of the initial posts did refer to a future party, none of those posts contained
references to a particular party nor did they mention a specific date, time, cost, or
any other details about any party. The mere reference that Doe was a “party
planner” is only one factor for consideration. Because ABR’s claims require a
showing of likelihood of confusion and/or commercial use, the district court did
not err in dismissing ABR’s complaint sua sponte.1
2. The district court did not err in dismissing ABR’s trademark
infringement, false designation of origin, and unfair competition claims after
finding that there was no likelihood of confusion. Given the flexibility in
application of the Sleekcraft factors, application of certain factors over others does
not constitute clear error. Rearden LLC v. Rearden Com., Inc., 683 F.3d 1190,
1209 (9th Cir. 2012). The district court conducted its likelihood of confusion
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ABR’s appeal also implicates several First Amendment considerations worth
noting. Even assuming Doe’s posts were commercial in nature, this Court has
recognized and adopted the Rogers test, which protects expressive uses of
trademarks from Lanham Act liability. See Mattel v. MCA Records, Inc., 296 F.3d
894, 902 (9th Cir. 2002). Doe’s Instagram posts appear to constitute expressive
work under Rogers as the posts communicated messages that mocked ABR’s
policies and administration. To the extent ABR’s appeal attempts to improperly
use trademark laws to block the expression of negative views about the university
and its administration, such efforts fail.
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analysis by looking at the full context of Doe’s Instagram posts and by expressly
evaluating some of the Sleekcraft factors. The court’s analysis included a review of
the surrounding posts, comments, and the context in which the posts were made.
Only after conducting this review, and analyzing some of the Sleekcraft factors,
did the district court find that there was no likelihood of confusion. We find that
the district court properly applied the factors and did not abuse its discretion.
3. Similarly, the district court did not err by refusing to apply the initial
interest confusion doctrine, which also requires a finding of likelihood of
confusion. Network Automation, Inc. v. Advanced Sys. Concepts, Inc., 638 F.3d
1137, 1149 (9th Cir. 2011).
4. The district court did not err in its analysis of ABR’s false advertising
claim. Contrary to ABR’s assertion, the district court analyzed the claim, finding
that a prudent consumer would not be confused or deceived by the posts included
on Doe’s Instagram. This necessarily includes the post regarding the alleged
collaboration with Teva Pharmaceuticals. The district court’s failure to quote the
factual allegations verbatim does not constitute error. Thus, we affirm the district
court’s order dismissing ABR’s false advertising claim since the claim also
requires a showing of deceit or likelihood of deceit. Wells Fargo & Co. v. ABD
Ins. & Fin. Servs. Inc, 758 F.3d 1069, 1071 (9th Cir. 2014), as amended (Mar. 11,
2014).
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5. The district court did not err in declining to decide ABR’s Arizona
state law dilution claim once the court dismissed all of the claims over which it had
original jurisdiction. Contrary to ABR’s contention, 28 U.S.C. § 1338(b) does not
confer district courts with original jurisdiction over state law dilution claims.
Rather, the statute provides “original jurisdiction of any civil action asserting a
claim of unfair competition . . . .” 28 U.S.C. § 1338(b). The statute provides
supplemental jurisdiction over state law dilution claims. Levi Strauss & Co. v.
Blue Bell, Inc., 778 F.2d 1352, 1362 (9th Cir. 1985). Accordingly, the district
court properly exercised its discretion in deciding not to exercise supplemental
jurisdiction over the state law dilution claim after dismissing all federal claims. Id;
see also 28 U.S.C. § 1367(c)(3).
That the district court decided ABR’s state law unfair competition claim but
did not decide its state law dilution claim was not an abuse of discretion. As
explained above, under 28 U.S.C. § 1338(b), the court had original jurisdiction
over ABR’s unfair competition claim and properly resolved that claim. An unfair
competition claim and a state dilution claim are distinct. Given that the dilution
claim required additional analysis, the district court did not err in declining to
exercise supplemental jurisdiction over ABR’s dilution claim.
6. The district court did not err in denying ABR’s motion for default
judgment as the complaint lacked merit as to the substantive claims and was
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insufficient. See Eitel v. McCool, 782 F.2d 1470, 1471–72 (9th Cir. 1986); Aldabe,
616 F.2d at 1092–93.
AFFIRMED.
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