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Woofbeach, Inc. v. Holland

United States District Court, N.D. Illinois, Eastern Division

December 11, 2017

WOOFBEACH, INC., Plaintiff,
v.
STEVE HOLLAND, Individually and d/b/a BEACH FOR DOGS, BEACH FOR DOGS AURORA, INC., and BEACH FOR DOGS CORPORATION, Defendants. STEVE HOLLAND, BEACH FOR DOGS, BEACH FOR DOGS AURORA, INC., and BEACH FOR DOGS CORPORATION, Counter-Plaintiffs,
v.
WOOFBEACH, INC., ERIC WILSON, and CHRISTINA WILSON, Counter-Defendants.

          MEMORANDUM OPINION AND ORDER

          Robert M. Dow, Jr. United States District Judge.

         In its Second Amended Complaint (“SAC”) [55], Plaintiff Woofbeach, Inc. (“Woofbeach”) brings suit against Steve Holland (“Holland”) and three companies that Holland co-owns-Beach for Dogs, Beach for Dogs Aurora, Inc., and Beach for Dogs Corporation (the “Holland Companies”)-for (1) trademark infringement in violation of the Latham Act, 15 U.S.C. § 1125(a); (2) violation of the Illinois Uniform Deceptive Trade Practices Act, 815 ILCS 510/2 et seq. (“UDTPA”); and (3) violation of the Illinois Consumer Fraud and Deceptive Trade Practices Act, 815 ILCS 505/2 et seq. (“ICFA”). In their answer to Woofbeach's First Amended Complaint, [27], Holland and the Holland Companies counter-sued Woofbeach and its purported owners, Eric and Christina Wilson (the “Wilsons”) for (1) a declaration that they have not violated the Latham Act; (2) a declaration that they have not violated the UDTPA; (3) breach of contract; (4) breach of fiduciary duty to partnership; and (5) breach of fiduciary duty to Holland. See [29] (First Amended Counterclaim). Although Holland and the Holland Companies did not re-plead these counterclaims in their answer to the SAC, see [60], they have informed the Court that they are proceeding with the counterclaims.

         Currently before the Court are Holland and the Holland Companies' motion to dismiss Woofbeach's ICFA claim (Count III) for failure to state a claim [30] and Woofbeach and the Wilsons' motion to dismiss Holland and the Holland Companies' counterclaims [38]. For the reasons explained, below, Holland and the Holland Companies' motion to dismiss [30] is denied and Woofbeach and the Wilsons' motion to dismiss [38] is granted in part and denied in part. This case is set for status hearing on January 11, 2018.

         I. Background

         In its SAC [55], Woofbeach alleges as follows. Woofbeach is an Illinois corporation that provides dog training and groom services. Beginning no later than 2012, Woofbeach began using the service mark Woofbeach, which became the Word Mark registration, and a graphic logo containing the silhouette of a dog and palm tree, which became the Woofbeach Design Mark registration. Woofbeach is the exclusive owner of the Woofbeach Word Mark and the Woofbeach Design Mark.

         On May 1, 2015, Woofbeach filed an application for service mark protection with the United States Patent and Trademark Office (“USPTO”) for the Woofbeach Design Mark. On the same date, Woofbeach filed an application for service mark protection with the USPTO for the Woofbeach Word Mark.

         On January 26, 2016, the USPTO issued U.S. Federal Registration 4891993 for the Woofbeach Design Mark. The Woofbeach Design Mark Federal Registration 4891993 is for dog training and grooming services and consists of the stylized wording “WOOFBEACH” placed below silhouettes of two palm trees and a dog.

         On February 16, 2016, the USPTO issued U.S. Federal Registration 4900682 for the for the Woofbeach Word Mark. The Woofbeach Word Mark Federal Registration 4900682 is for dog training and groom services and consists of the word WOOFBEACH.

         Woofbeach has used the Woofbeach Word Mark and the Woofbeach Design Mark in connection with providing dog training and grooming services at its storefronts in Batavia, Illinois since 2012, Geneva, Illinois since 2014, and South Elgin, Illinois since 2015.

         Woofbeach became aware that Holland has been using the name “Beach for Dogs, ” in addition to a logo containing the name and a silhouette of a palm tree and a dog, in connection with dog training and dog grooming services in Wheaton, Illinois since mid-2015 and more recently in Naperville, Illinois. Woofbeach has never authorized Holland to use a name for dog training and dog grooming services which contains the word “beach” or a logo which contains the graphic elements of a silhouette of a dog and palm tree. Holland is a former customer of Woofbeach and was aware of the Woofbeach Word Mark and Woofbeach Design Mark.

         In Count I of the SAC, Woofbeach alleges that Holland's actions constitute trademark infringement in violation of the Latham Act, 15 U.S.C. § 1225(a). Woofbeach alleges that Holland's use of the name “Beach for Dogs” and a logo containing a silhouette of a dog and palm tree infringe on the Woofbeach Word Mark and Woofbeach Design Mark. According to the SAC, the “Beach for Dogs” name and related logo are confusingly similar to the Woofbeach Word Mark and Woofbeach Design Mark and Holland's ongoing use of the name and logo has caused and is likely to cause confusion in the minds of consumers as to the existence of a relationship between Woofbeach's dog training and grooming business and Holland's dog training and grooming business. Woofbeach alleges that, as a direct and proximate result of Holland's infringing and deceptive activities and the resulting confusion in the minds of the consuming public, Woofbeach has been and/or will be damaged and irreparably harmed. In particular, Woofbeach alleges that it will lose good will, suffer damage to its business reputation, and lose potential customers and sales.

         In Counts II and III of the SAC, respectively, Woofbeach alleges that Holland has engaged in wrongful conduct that violates the UDTPA, 815 ILCS 510/2 et seq., and the ICFA, 815 ILCS 505/2 et seq. In addition to its allegations that Holland used a name and logo that are confusingly similar to Woofbeach's, Woofbeach alleges on information and belief that Holland caused his personal cell phone number to be listed in certain Internet directories to appear next to listings for Woofbeach, to improperly direct potential customers for dog grooming and training services to him personally and to unlawfully trade on the good will of Woofbeach.

         Holland and the Holland Companies bring counterclaims against Woofbeach and the Wilsons and in support thereof, alleges as follows. Steve Holland is the president and co-owner of Beach for Dogs Aurora, Inc. and Beach for Dogs, Corporation, which are both Illinois corporations. The Wilsons are the purported owners of Woofbeach.

         The Holland Companies were formed at the beginning of 2015 to offer a variety of high quality services related to dog ownership, including dog training, grooming, boarding, and day care. They also sell food, treats, and grooming products. They have a strong social media presence on Facebook, Instagram, Twitter, and other similar sites. Since their inception, the Holland Companies have used the name “Beach for Dog” and a logo of “a cartoon dog catching a Frisbee on ...


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