Uber, Inc. v. Uber Technologies, Inc.

Background

Uber Inc. alleged that it had continuously used the unregistered “UBER” trade name and service mark since 1999 in connection with design, marketing, and related services. Uber Technologies, Inc., incorporated in 2010, became widely known for its ride-sharing application and later expanded into other services. Adomni, Inc. did business under the names “Uber OOH” and “Uber OOH, Inc.” and operated a platform for placing advertisements on digital screens.

Uber Inc. alleged that it had received calls, shipments, payments, and legal or regulatory communications intended for Uber Technologies. It also alleged that defendants planned to expand into advertising, including advertisements displayed on vehicles, mobile applications, digital billboards, and other screens. Uber Inc. claimed that this expansion created competitive proximity and a risk of consumer confusion. It further alleged that its trademark application for advertising and creative-design services was stalled because it overlapped with an Uber Technologies application.

The complaint asserted three claims under the federal Lanham Act: direct trademark infringement, reverse confusion, and unfair competition or false designation of origin. It also asserted New York claims for dilution, deceptive trade practices, common-law trademark infringement, common-law unfair competition, and unjust enrichment.

Rule 12(b)(6) standard

Defendants moved to dismiss under Rule 12(b)(6), which asks whether the complaint alleges enough facts to state a legally plausible claim. At this stage, the court accepted well-pleaded factual allegations as true and considered the complaint and documents attached to or incorporated into it. The court did not decide whether Uber Inc. would ultimately prove its claims.

Trademark claims

The court denied dismissal of the reverse-confusion claim in Count Two. Reverse confusion occurs when consumers mistakenly believe that the larger or later user of a mark is the source of the earlier user’s goods or services, or believe that the earlier user is an unauthorized infringer. Applying the factors commonly used to evaluate likely consumer confusion, the court concluded that the complaint plausibly alleged competitive proximity, similarity of the marks, distinctiveness of Uber Inc.’s mark, actual confusion involving businesses and others, and a possible expansion of Uber Inc.’s services. The court stated that weighing those factors required a fuller factual record.

The court also denied dismissal of the direct-infringement claim in Count One. It found that the complaint plausibly alleged that defendants intended to offer advertising and promotional services, that those services could be near Uber Inc.’s design and marketing services, and that consumers might be confused about affiliation, authorization, or the source of services. The court also found the allegations sufficient at the pleading stage to support an inference that defendants may have acted in bad faith, including because Uber Technologies allegedly knew of Uber Inc.’s use of the mark and had offered money for Uber Inc. to change its name.

The court rejected defendants’ additional arguments concerning allegations about Uber Technologies’ internal divisions and advertising activities in Atlanta, Dallas, and Phoenix. It stated that the significance of the test-market allegations could not be determined from the pleadings, particularly because the complaint alleged an intention to expand beyond those markets.

Laches defense

Laches is an equitable defense based on an unreasonable delay in bringing a claim that prejudices the defendant. The court denied dismissal based on laches. Although Uber Inc. allegedly knew of Uber Technologies’ use of the “Uber” mark by 2012 and had received misdirected communications, the court held that this did not establish that Uber Inc. knew or should have known of an actionable trademark claim more than six years before the action began. The court also considered Uber Technologies’ alleged 2015 offer to pay Uber Inc. to change its name as supporting the need for a more developed factual record.

Unjust enrichment

The court dismissed Count Eight, the unjust-enrichment claim. It held that the complaint did not describe a relationship involving reliance or inducement, identify an equitable obligation from defendants to Uber Inc., or allege a wrong outside the trademark claims. The court therefore concluded that the allegations did not plausibly state an unjust-enrichment claim.

Remaining New York claims and disposition

The court denied dismissal of the New York claims for deceptive business practices, common-law trademark infringement, and common-law unfair competition because defendants’ arguments for dismissing them were the same as their unsuccessful arguments against the Lanham Act claims.

The court also denied dismissal of the dilution claim in Count Four. It concluded that the complaint plausibly alleged that Uber Inc.’s mark was distinctive and that defendants’ prominent and widespread use of the mark could impair its distinctiveness or harm its reputation.

The court granted defendants’ motion to dismiss as to the unjust-enrichment claim and otherwise denied the motion to dismiss. The opinion was signed by Judge P. Castel.