Vinh-Sanh Trading Corporation v. SFTC, Inc.

Background

Vinh-Sanh imports and distributes rice and rice-based products. It established the THREE LADIES brand in the mid-1980s and owns registered composite and Vietnamese-language word marks associated with that brand. SFTC imports, distributes, and wholesales Asian foods. The parties had briefly had a wholesale relationship involving a small quantity of THREE LADIES rice.

Vinh-Sanh alleged that SFTC marketed and sold Thai jasmine rice using photographs of three women in traditional Asian clothing, along with the title “THREE ASIAN LADIES” in product listings. Vinh-Sanh found the rice at stores and markets in California and presented evidence that retailers and consumers might confuse SFTC’s product with THREE LADIES rice. SFTC’s chief executive had acknowledged knowing about Vinh-Sanh’s marks and rice when creating SFTC’s mark in 2018.

Vinh-Sanh asserted four claims: federal trademark infringement under 15 U.S.C. § 1114, federal unfair competition under 15 U.S.C. § 1125(a), common-law trademark infringement, and unfair competition under California Business and Professions Code § 17200. SFTC did not oppose Vinh-Sanh’s motion for summary judgment and did not respond to the court’s order to show cause concerning that motion.

Summary-judgment standard

Summary judgment is appropriate when the evidence shows no genuine dispute about a material fact and the moving party is entitled to judgment as a matter of law. The court emphasized that a motion cannot be granted merely because the opposing party does not respond. The moving party must still establish the merits of its claims and show that no genuine factual dispute requires a trial.

Court’s reasoning

For federal trademark infringement, the court required Vinh-Sanh to show ownership of a valid mark and SFTC’s use of a mark likely to cause confusion. The court found that Vinh-Sanh’s registrations and continuous use established ownership and validity. It then applied the eight likelihood-of-confusion factors used by the Ninth Circuit.

The court concluded that the THREE LADIES marks were distinctive and appeared strong. It found the marks sufficiently similar because both products were bags of jasmine rice displaying images of three women in traditional, formal Asian clothing. Although the images differed in some details and one was a drawing while the other was a photograph, the court reasoned that consumers could view SFTC’s image as an updated version of Vinh-Sanh’s familiar design. The parties sold the same product through similar channels, and SFTC knew about Vinh-Sanh’s brand. The court found the evidence of actual consumer confusion limited but noted evidence that a retailer had mistaken SFTC’s rice for THREE LADIES rice. Considering the factors together, the court found a likelihood of confusion.

The court also found that Vinh-Sanh had shown the elements of federal unfair competition. It concluded that Vinh-Sanh’s alleged losses in sales and goodwill were commercial injuries within the interests protected by the federal statute and were directly connected to consumer confusion. Because the same likelihood-of-confusion analysis applied to the common-law trademark claim, that claim also succeeded. Finally, because SFTC’s conduct violated federal trademark and unfair-competition law and common-law trademark law, the court found it constituted unlawful competition under California Business and Professions Code § 17200.

Disposition

The court GRANTED Vinh-Sanh’s motion for summary judgment on its four claims. It DENIED without prejudice Vinh-Sanh’s request for a permanent injunction because Vinh-Sanh had not addressed that remedy in its summary-judgment motion and raised it for the first time in its reply. The court stated that Vinh-Sanh could separately move for the relief it believed followed from the summary-judgment ruling, which could include a permanent injunction.