Biomax Health Products LLC v. Perfectx USA

Background

Biomax Health Products LLC alleged that it markets and sells a topical joint and muscle therapy cream under the registered PENETREX word mark. It also alleged that, since May 2022, it had used a PENETREX design consisting of a multicolored band on its product packaging. Biomax's most popular product was described as a white, cylindrical jar labeled with the PENETREX name and product information.

Biomax alleged that, beginning around February 2023, Perfectx USA marketed and sold a topical cream called PERFECTX Intensive Concentrate Cream. According to the allegations, the product used a similar white cylindrical jar, a similar multicolored band, similar sans serif fonts, and a similar product description. The parties marketed their products through overlapping channels, including Amazon and Facebook advertisements. Biomax also alleged that Perfectx used images from Biomax's advertisements, made false claims about its products' efficacy and United States origin, and sold products of lower quality that consumers confused with Biomax's products.

Biomax filed claims for federal trademark infringement, unfair competition, and false advertising, along with claims under California law. Biomax moved for a preliminary injunction after previously obtaining a temporary restraining order. The court held a hearing on July 11, 2023, to decide whether to convert that temporary order into a preliminary injunction.

Legal standard

A preliminary injunction is temporary relief issued before the case ends. The moving party must show a likelihood of success on the merits, a likelihood of irreparable harm without an injunction, that the balance of hardships favors the moving party, and that the injunction is in the public interest. The court also described the Ninth Circuit's sliding-scale approach, under which serious questions on the merits may suffice when the balance of hardships strongly favors the plaintiff.

Court's analysis

For the trademark-infringement and unfair-competition claims, the court considered whether Biomax had a valid, protectable trademark and whether Perfectx's use was likely to confuse consumers. The court applied the eight Sleekcraft factors, which address such issues as the strength of the mark, the relatedness and similarity of the products and marks, marketing-channel overlap, actual confusion, the defendant's intent, and the likelihood of expansion.

The court found that Biomax had made a strong showing on the first seven factors. It found that PENETREX was at least a suggestive mark, that Biomax had submitted evidence of long-term use, and that the products were related and relatively inexpensive. The court also found the marks and products very similar, the marketing channels overlapping, and evidence of actual consumer confusion. Biomax's evidence that Perfectx appropriated Biomax's advertisements supported an inference that Perfectx intended to create confusion. The eighth factor, likelihood of product expansion, was neutral. Considering the factors together, the court found a high likelihood of confusion and concluded that Biomax was likely to succeed on the merits.

The court applied a rebuttable presumption of irreparable harm because Biomax had shown a likelihood of success on a trademark-infringement claim under the federal trademark statute. The court found that the presumption had not been rebutted. It further found that the balance of hardships favored Biomax because the only identified harm to Perfectx was lost profits from sales likely to be infringing. The court also found that the public interest favored an injunction, citing the harm to consumers from trademark infringement and Biomax's evidence of allegedly false advertising.

Disposition

The court granted the motion and issued a preliminary injunction pending the conclusion of the litigation. The order enjoined Perfectx, its officers, directors, employees, agents, subsidiaries, distributors, and people acting with notice of the order from manufacturing, importing, advertising, promoting, offering for sale, selling, distributing, or transferring products bearing marks identical or confusingly similar to the PENETREX trademarks. It also barred concealment, destruction, sale, transfer, or other disposal of those products and related evidence.

The order further addressed use of identical or confusingly similar marks on websites and third-party e-commerce platforms, and required the specified parties to immediately discontinue listed online uses, including uses connected with e-commerce websites, domain-name extensions, website source code, webpages, advertising links, search-engine databases, and cache memory.

Judge

Susan Illston, United States District Judge, signed the order dated July 11, 2023.