Visier, Inc. v. Google LLC ( 2022 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 VISIER, INC., Case No. 22-cv-05323-TSH 8 Plaintiff, ORDER DENYING MOTION TO 9 v. STRIKE AND GRANTING MOTION TO DISMISS 10 GOOGLE LLC, Re: Dkt. No. 15 11 Defendant. 12 13 I. INTRODUCTION 14 This action arises from Defendant Google’s alleged infringement of Plaintiff Visier, Inc.’s 15 VISIER trademarks, which Visier uses in connection with its people analytics platform, VISIER. 16 Pending before the Court is Google’s Motion to Strike and Motion to Dismiss portions of Visier’s 17 complaint pursuant to Federal Rule of Civil Procedure 12(f) and 12(b)(6). ECF No. 15. Visier 18 filed an Opposition (ECF No. 22) and Google filed a Reply (ECF No. 24). The Court finds this 19 matter suitable for disposition without oral argument and VACATES the December 29, 2022 20 hearing. See Civ. L.R. 7-1(b). Having considered the parties’ positions, relevant legal authority, 21 and the record in this case, the Court DENIES Google’s motion to strike and GRANTS its motion 22 to dismiss for the following reasons.1 23 II. BACKGROUND 24 Visier states it is “the recognized global leader in people analytics and workforce 25 planning.” Compl. ¶¶ 11-12, ECF No. 1. The VISIER platform is a cloud-based software 26 application that “delivers predictive analytics for HR, leveraging advanced machine learning 27 1 techniques” and is used by companies “to improve their employee retention, diversity and 2 inclusion, [and] engagement.” Id. ¶¶ 11, 13. Since its first use of the VISIER mark in February 3 2011, Visier “has expended millions of dollars in advertising, promoting, and selling its VISIER 4 Software, which has received substantial unsolicited publicity and several industry awards. As a 5 result, Visier has accumulated considerable goodwill and recognition in its VISIER mark, and has 6 developed strong common law rights in the VISIER mark.” Id. ¶ 14. Visier also owns several 7 registrations in the U.S. and around the world for its VISIER mark. Id. ¶ 16 & Ex. 1 (certificates 8 of registration). 9 Google offers Internet-related services and products, including online advertising 10 technologies, the GOOGLE search engine, cloud computing, software, and hardware. Id. ¶ 17. 11 Visier alleges it learned from a May 2021 TechCrunch article that Google “was launching a new 12 managed machine learning platform ‘integrated with Vizier’” and was using VIZIER to refer to 13 “Google’s AI optimizer that can automatically tune hyperparameters in machine learning models.” 14 Id. ¶¶ 18-19. Google’s VIZIER can be used with any software application that incorporates 15 machine learning, including the VISIER Software. Id. ¶ 23. Visier alleges that “[g]iven the 16 relatedness of the parties’ software, and the near identity of the respective marks, Google’s use of 17 VIZIER is likely to cause confusion as to whether its software incorporates Visier’s innovative 18 technology and cutting-edge algorithms, or is otherwise connected to, sponsored, or approved by 19 Visier.” Id. ¶ 4. Alternatively, “and given Google’s ability to overwhelm the market via its 20 GOOGLE search engine and other means, there is a real danger that consumers could be led to 21 believe that Visier is simply reselling or repackaging Google technology, or is infringing upon 22 Google’s intellectual property rights, causing reverse confusion.” Id. 23 Visier filed this lawsuit on September 19, 2022, alleging five causes of action against 24 Google: (1) trademark infringement (15 U.S.C. § 1114); (2) false designation of origin (15 U.S.C. 25 § 1125(a)); (3) trademark infringement (common law); (4) unfair competition (Cal. Bus. & Prof. 26 Code §§ 17200, et seq.) (“UCL”); and (5) unfair competition (common law). Id. ¶¶ 27-61. 27 Google filed the present motion on November 21, 2022. 1 III. DISCUSSION 2 A. Motion to Strike 3 Google seeks to strike the bolded portions of the factual allegations below on the ground 4 that they are immaterial to the asserted claims and prejudicial to Google: 5 • Given the propensity for both forward and reverse confusion, as well as dilution of its distinctive mark, Visier requested 6 that Defendant stop using the VIZIER mark and transition to a new name. (Id. ¶ 23); 7 • This injury includes a reduction in the distinctiveness of 8 Visier’s VISIER Marks, its house marks, and injury to Visier’s reputation that cannot be remedied through damages 9 alone, and Visier has no adequate remedy at law. (Id. ¶ 49); 10 • This injury includes a reduction in the distinctiveness of Visier’s VISIER Marks, its house marks, and injury to 11 Visier’s reputation that cannot be remedied through damages alone, and Visier has no adequate remedies at law. (Id. ¶ 55). 12 13 Mot. at 1. Google argues these allegations “would be expected boilerplate in a complaint alleging 14 dilution of a famous trademark under 15 U.S.C. § 1125(c), but are immaterial to the claims Visier 15 has actually pleaded, which all sound in trademark infringement.” Id. at 4. Google also argues it 16 will be prejudiced if Visier’s allegations regarding dilution are not stricken because they do not 17 address the likelihood of confusion standard for a trademark infringement claim and [“a]llowing 18 them to remain would suggest that Visier has alleged dilution, that it has a famous mark, and/or 19 that ‘reduction in the distinctiveness’ of Visier’s marks is actionable.” Id. 20 1. Legal Standard 21 A “court may strike from a pleading an insufficient defense or any redundant, immaterial, 22 impertinent, or scandalous matter.” Fed. R. Civ. P. 12(f). The purpose of a Rule 12(f) motion to 23 strike is “to avoid the expenditure of time and money that must arise from litigating spurious 24 issues by dispensing with those issues prior to trial[.]” Whittlestone, Inc. v. Handi-Craft Co., 618 25 F.3d 970, 973 (9th Cir. 2010) (quotation omitted). 26 Motions to strike are generally disfavored and “should not be granted unless the matter to 27 be stricken clearly could have no possible bearing on the subject of the litigation.” Platte Anchor 1 The court “should view the pleading in the light most favorable to the nonmoving party” and “[i]f 2 there is any doubt whether the portion to be stricken might bear on an issue in the litigation, the 3 court should deny the motion.” Id. (citation omitted). “Further, because Rule 12(f) motions are 4 disfavored, ‘courts often require a showing of prejudice by the moving party before granting the 5 requested relief.’” Digital Verification Sys., LLC v. Foxit Software Inc., 2022 WL 2800081, at *1 6 (N.D. Cal. Jan. 11, 2022) (quoting Sanchez v. City of Fresno, 914 F. Supp. 2d 1079, 1122 (E.D. 7 Cal. 2012)). 8 “Ultimately, whether to grant a motion to strike lies within the sound discretion of the 9 district court.” Cruz v. Bank of New York Mellon, 2012 WL 2838957, at *2 (N.D. Cal. July 10, 10 2012) (citing Whittlestone, 618 F.3d at 973). 11 2. Analysis 12 Google argues the Court should Visier’s allegations regarding whether Google diluted or 13 reduced the distinctiveness of Visier’s mark because they are immaterial. A matter is immaterial 14 if it “has no essential or important relationship to the claim for relief or the defenses being 15 pleaded.” Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993), rev’d on other grounds, 16 510 U.S. 517 (1994). 17 To prevail on a claim for federal trademark infringement under the Lanham Act, Visier 18 must show: (1) it has a protectible ownership interest in the mark; and (2) Google’s use of the 19 mark is likely to cause consumer confusion. Network Automation, Inc. v. Advanced Sys. 20 Concepts, Inc., 638 F.3d 1137, 1144 (9th Cir. 2011) (citation omitted). A claim for false 21 designation of origin under the Lanham Act is subject to “[e]ssentially the same standard” as 22 trademark infringement, except a claim for false designation of origin does not require that the 23 mark be registered. Marketquest Grp., Inc. v. BIC Corp., 2011 WL 5360899, at *2 n.4 (S.D. Cal. 24 Nov. 7, 2011) (citing 15 U.S.C. §§ 1114(1) (trademark infringement), 1125(a)(1) (false 25 designation of origin)). Visier’s asserted common law trademark and unfair competition claims 26 are “substantially congruent” to the Lanham Act claims. See Gianni Versace, S.p.A. v. Versace 27 19.69 Abbigliamento Sportivo SRL, 328 F. Supp. 3d 1007, 1013-14 (N.D. Cal. 2018) (citing 1 2004)). 2 Visier admits that it does not bring a claim for trademark dilution. Opp’n at 6. However, 3 it argues the allegations Google moves to strike “describe one type of harm Visier is suffering as a 4 result of Google’s use of a confusingly similar trademark—a reduction in the strength of its 5 VISIER trademark.” Id. Visier maintains that “Google’s use of a near identical mark in a similar 6 or related software space dilutes or diminishes the source-identifying strength of the VISIER 7 mark. And the fact that it is Google using the confusingly similar mark makes it all the more 8 damaging, given Google’s unparalleled ability to reach consumers around the world via its 9 GOOGLE search engine.” Id. at 7. At this stage in the case, the Court finds it is not clear that 10 these allegations have no possible bearing on the subject of the litigation. 11 As a preliminary matter, Google cites Playmakers, LLC v. ESPN, Inc., 297 F. Supp. 2d 12 1277, 1284-85 (W.D. Wash. 2003), aff’d, 376 F.3d 894 (9th Cir. 2004), for the proposition that 13 “dilution allegations [are] not relevant to [a] trademark infringement claim.” Mot. at 5. But 14 Playmakers did not involve a motion to strike “dilution allegations,” nor did that court prohibit a 15 party from using the word “dilution” or similar terms where no anti-dilution claim is asserted. 16 Instead, the court was evaluating the probability of success of the plaintiff’s trademark 17 infringement claim for purposes of deciding whether to issue a preliminary injunction. 18 Playmakers, 297 F. Supp. 2d at 1278-82. The court found there was no likelihood of confusion 19 between the respective marks to support a likelihood of success on the infringement claim, and it 20 declined to find otherwise based on plaintiff’s alternative theory that the defendant’s use of 21 “Playmakers” would “tarnish” the plaintiff’s marks. Id. at 1284-85 (“the Court declines to adopt a 22 new theory of tarnishment to be used in the straightforward reverse confusion context”). Unlike in 23 Playmakers, Visier’s allegations do not form an alternative theory of trademark infringement; 24 instead, they describe a form of harm Visier alleges it is suffering as a result of Google’s use of a 25 similar mark. 26 Google also argues it will be prejudiced if the allegations remain because they would result 27 in “unnecessarily complicating the litigation, increasing costs, and confusing the issues.” Mot. at 1 distinctiveness are relevant to the standard for trademark infringement or harm, and that “nothing 2 will prohibit Visier from proliferating the same erroneous arguments about the scope of trademark 3 infringement in discovery, summary judgment, and/or trial in this case.” Id.’ Reply at 5. It is true 4 that “[t]he possibility that issues will be unnecessarily complicated or that superfluous pleadings 5 will cause the trier of fact to draw ‘unwarranted’ inferences at trial is the type of prejudice that is 6 sufficient to support the granting of a motion to strike.” Cal. Dep’t of Toxic Substances Control v. 7 Alco Pacific, Inc., 217 F. Supp. 2d 1028, 1033 (C.D. Cal. 2002) (granting in part motion to strike 8 affirmative defenses). However, Google’s generalized arguments are not enough to show 9 prejudice because, if any possibility of confusion remained after discovery has closed and any 10 summary judgment motions are resolved, the matter could be addressed by motions in limine prior 11 to trial. Therefore, viewing the pleadings in the light most favorable to Visier and resolving any 12 doubts in its favor, the Court must deny the motion. See Platte Anchor Bolt, 352 F. Supp. 2d at 13 1057. 14 B. Motion to Dismiss 15 Google also moves to dismiss Visier’s UCL claim “to the extent this claim is predicated on 16 Google’s allegedly ‘unfair’ conduct.” Mot. at 2. 17 1. Legal Standard 18 A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) “tests the legal 19 sufficiency of a claim. A claim may be dismissed only if it appears beyond doubt that the plaintiff 20 can prove no set of facts in support of his claim which would entitle him to relief.” Cook v. 21 Brewer, 637 F.3d 1002, 1004 (9th Cir. 2011) (citation and quotation marks omitted). Rule 8 22 provides that a complaint must contain a “short and plain statement of the claim showing that the 23 pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). Thus, a complaint must plead “enough facts 24 to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 25 570 (2007). Plausibility does not mean probability, but it requires “more than a sheer possibility 26 that a defendant has acted unlawfully.” Ashcroft v. Iqbal, 556 U.S. 662, 687 (2009). A complaint 27 must therefore provide a defendant with “fair notice” of the claims against it and the grounds for 1 In considering a motion to dismiss, the court accepts factual allegations in the complaint as 2 true and construes the pleadings in the light most favorable to the nonmoving party. Manzarek v. 3 St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008).; Erickson v. Pardus, 551 4 U.S. 89, 93-94 (2007). However, “the tenet that a court must accept a complaint’s allegations as 5 true is inapplicable to threadbare recitals of a cause of action’s elements, supported by mere 6 conclusory statements.” Iqbal, 556 U.S. at 678. 7 If a Rule 12(b)(6) motion is granted, the “court should grant leave to amend even if no 8 request to amend the pleading was made, unless it determines that the pleading could not possibly 9 be cured by the allegation of other facts.” Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (en 10 banc) (citations and quotations omitted). However, a court “may exercise its discretion to deny 11 leave to amend due to ‘undue delay, bad faith or dilatory motive on part of the movant, repeated 12 failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing 13 party . . ., [and] futility of amendment.’” Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876, 14 892–93 (9th Cir. 2010) (alterations in original) (quoting Foman v. Davis, 371 U.S. 178, 182 15 (1962)). 16 2. Analysis 17 Section 17200 of California’s UCL provides a cause of action for business practices that 18 are (1) unlawful, (2) unfair, or (3) fraudulent. Lozano v. AT & T Wireless Servs., Inc., 504 F.3d 19 718, 731 (9th Cir. 2007). “Each prong of the UCL is a separate and distinct theory of liability; 20 thus, the ‘unfair’ practices prong offers an independent basis for relief.” Id. 21 Visier alleges Google “has engaged in unlawful and/or unfair business practices in 22 violation of the [UCL] by among other things, engaging in trademark infringement.” Compl. ¶ 53. 23 It alleges Google’s acts “are unlawful and/or unfair under the UCL because Defendant’s use of the 24 VIZIER mark in California is likely to confuse consumers as to the source, origin, or affiliation of 25 Defendant’s software, to misrepresent the nature, characteristics and qualities of Defendant’s 26 software and/or to deceive or have a tendency to deceive a substantial segment of consumers into 27 believing that Defendant’s software somehow incorporates, or has the nature, characteristics, 1 There is no dispute that Visier has stated a claim under the “unlawful” prong of the UCL 2 based on Google’s alleged trademark infringement. Reply at 6. Google argues Visier has not 3 pleaded facts supporting an “unfair” antitrust allegation, and its UCL claim should be dismissed to 4 the extent it is predicated on the “unfair” prong. Mot. at 8. The Court agrees. 5 Where, as here, a plaintiff “who claims to have suffered injury from a direct competitor’s 6 ‘unfair’ act or practice invokes section 17200, the word ‘unfair’ in that section means conduct that 7 threatens an incipient violation of an antitrust law, or violates the policy or spirit or one of those 8 laws . . . , or otherwise significantly threatens or harms competition.” Cel-Tech Communic’ns, 9 Inc. v. Los Angeles Cellular Tel. Co., 20 Cal. 4th 163, 187 (1999). Visier’s complaint does not 10 include any allegation that Google’s actions threaten “an incipient violation of an antitrust law,” as 11 Cel-Tech requires. In fact, Visier admits that its “UCL claim does not purport to be a ‘business- 12 competitor claim’ [and] it does not allege any anticompetitive conduct by a direct competitor.” 13 Opp’n 9. Thus, because Visier does not allege any facts in support of a cognizable antitrust 14 violation, its UCL claim must be dismissed to the extent it is predicated on the “unfair” prong. 15 See Cel-Tech Communic’ns, 20 Cal. 4th at 187; Levitt v. Yelp! Inc., 765 F.3d 1123, 1136 (9th Cir. 16 2014) (affirming dismissal of business-competitor claim under the “unfair” prong for failing to 17 state a claim where general allegation of competitive harm did not amount to a violation of 18 antitrust law pursuant to Cel-Tech); DocMagic, Inc. v. Ellie Mae, Inc., 745 F. Supp. 2d 1119, 1147 19 (N.D. Cal. 2010) (dismissing claim under the unfair prog for failing to allege facts showing 20 defendant’s conduct violated antitrust law). 21 IV. CONCLUSION 22 For the reasons stated above, the Court DENIES Google’s motion to strike and GRANTS 23 its motion to dismiss Visier’s UCL claim to the extent it is predicated on the “unfair” prong. The 24 Court sets this matter for a case management conference on January 19, 2023 at 10:00 a.m. by 25 Zoom video conference. The webinar link and instructions are located at 26 https://cand.uscourts.gov/judges/hixson-thomas-s-tsh/. This conference shall be attended by lead 27 trial counsel. By January 12 the parties shall file a Joint Case Management Statement containing 1 available at: http://cand.uscourts.gov/tshorders. The Joint Case Management Statement form may 2 || be obtained at: http://cand.uscourts.gov/civilforms. 3 IT IS SO ORDERED. 4 5 Dated: December 16, 2022 6 TAA. THOMAS S. HIXSON 7 United States Magistrate Judge 8 9 10 11 a 12 13 © 15 16 = 17 Z 18 19 20 21 22 23 24 25 26 27 28