Case 1:15-cv-00031-RHB Doc #18 Filed 03/16/15 Page 1 of 8 Page ID#353 QUEST VENTURES, LTD., d/b/a GRAVITY BAR & GRILL UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION v. Plaintiff, File No. 1:15-CV-31 Hon. ROBERT HOLMES BELL GRAVITY TAPHOUSE & GRILLE, TAP HOUSE GRILLE, LLC, and REDWATER RESTAURANT GROUP, LLC, Defendants. / OPINION AND ORDER This is an action for servicemark infringement and unfair competition brought by Plaintiff Quest Ventures, which operates Gravity Bar and Grill in Milford, Michigan, against Defendant RedWater Restaurant Group, which operates Gravity Taphouse and Grille in Grand Rapids, Michigan. The matter is presently before the Court on Plaintiff s Motion for Preliminary Injunction to enjoin Defendants from using the Gravity mark (ECF No. 2). Defendants have filed a Response (ECF No. 10), to which Plaintiff has filed a Reply (ECF No. 13) and a letter documenting additional instances of actual confusion (ECF No. 17.) The Court heard oral argument on the motion on Thursday, February 26, 2015. For the reasons established below, the Court will deny Plaintiff s motion. I. Plaintiff opened the Gravity Bar and Grill in Milford, Michigan, in December 2003.
Case 1:15-cv-00031-RHB Doc #18 Filed 03/16/15 Page 2 of 8 Page ID#354 Gravity Bar & Grill has an atmosphere of relaxed elegance and style, where servers wear white dress shirts, the tables are clothed in linen, and reservations are accepted. The menu includes steak, fish, pasta, and signature items. Entrees are priced from $25 to $42. The mark for Gravity Bar and Grill uses Arial font with baby blue and coral coloring. The mark is featured in Plaintiff s restaurant, on its website, and in advertising materials. Plaintiff operates a website at www.gravityrestaurant.com and maintains an email club of 1,800 members. Plaintiff primarily advertises in newspapers such as the Detroit Free Press, the Jewish News, the Detroit News, and the Milford Times, and in magazines such as Hour Magazine, Style Magazine, and Menu Guide. Plaintiff is featured on review-based websites such as Yelp!, TripAdvisor, Google, and Urbanspoon. Most of its reviews are laudatory. Defendants opened the Gravity Taphouse and Grille in Grand Rapids, Michigan, in about October 2014. Gravity Taphouse and Grille features an industrial motif, where servers wear t-shirts and no reservations are accepted. The menu includes pizza, tacos, pasta, and flat breads. Entrees are priced from $12 to $21. Defendants name is based upon a craft beer term, gravity, that refers to the density of the beer and sugar dissolution. Defendants mark uses Krasvyi font with black and silver coloring. Defendant uses its mark variously as Gravity, Gravity Taphouse, and Gravity Taphouse and Grille. Defendant uses the mark Gravity, without a further identifier as a Taphouse, on many of its signs and in press releases. Defendants operate a website at www.gravitytaphouse.com and offers direct emails to consumers. Defendants are also 2
Case 1:15-cv-00031-RHB Doc #18 Filed 03/16/15 Page 3 of 8 Page ID#355 featured on review-based websites such as Yelp!, TripAdvisor, Google, and Urbanspoon. Defendants have some mediocre reviews regarding the food, atmosphere, and beer selection. Plaintiff filed an application to federally register the Gravity name and mark in the United States Patent and Trademark Office at about the time Defendants first opened their restaurant. Plaintiff sent a cease and desist letter to Defendants, and a second letter advising Defendants of actual instances of confusion. At least one consumer confused Plaintiff and Defendants when he tried to sign up for the wrong email club. Defendants refused to change their name. II. When considering a motion for a preliminary injunction, the Court weighs the following factors, with no one factor overriding: (1) whether Plaintiff has a strong likelihood of success on the merits, (2) whether Plaintiff would suffer irreparable injury absent a preliminary injunction, (3) whether granting the preliminary injunction would cause substantial harm to others, and (4) whether the public interest is served by granting the preliminary injunction. Samuel v. Herrick Mem l Hosp., 201 F.3d 830, 833 (6th Cir. 2000). A. Likelihood of Success on the Merits The basis of Plaintiff s claim is servicemark infringement and unfair competition under the Lanham Act, 15 U.S.C. 1125(a), the Michigan Consumer Protection Act ( MCPA ), Michigan Compiled Laws 445.903(3)(1)(a), and Michigan common law. The district court must first determine whether the mark is protectable, and if so, whether there 3
Case 1:15-cv-00031-RHB Doc #18 Filed 03/16/15 Page 4 of 8 Page ID#356 is a likelihood of confusion as a result of the would-be infringer s use of the mark. Tumblebus Inc. v. Cranmer, 399 F.3d 754, 760-61 (6th Cir. 2005). The likelihood of confusion test governs the claims under both state and federal law. Id. (citing 15 U.S.C. 1125(a)); Homeowners Grp., Inc. v. Home Mktg. Specialists, Inc., 931 F.2d 1100, 1105 n.1 (6th Cir. 1991) (citing Mich. Comp. Laws 445.903(1)(a)). The protectability of the mark depends on the level of the mark s distinctiveness, such as whether the mark is suggestive, arbitrary, or fanciful. Id. To demonstrate a likelihood of confusion, the plaintiff must show that the use of the allegedly infringing trademark is likely to cause confusion among consumers regarding the origin of the goods offered by the parties. Gen. Motors Corp. v. Lanard Toys, Inc., 468 F.3d 405, 412 (6th Cir. 2006) (internal quotations omitted). The district court assesses the likelihood of confusion based upon the eight Frisch factors. Gen. Motors, 468 F.3d at 412; Frisch s Rests., Inc. v. Elby s Big Boy of Steubenville, Inc., 670 F.2d 642, 648 (6th Cir. 1982). Plaintiffs argue that their Gravity mark warrants protection under the Frisch factors because (1) their mark is arbitrary and therefore conceptually strong; (2) both parties operate full-service restaurants under the Gravity mark; (3) both restaurant names contain the dominant mark Gravity; (4) there have been actual instances of consumer confusion; (5) both parties use Internet and social media marketing; (6) a consumer could incorrectly but logically assume the two restaurants were related; (7) Defendants chose the Gravity mark despite knowledge of Plaintiff s senior mark; and (8) Defendants may 4
Case 1:15-cv-00031-RHB Doc #18 Filed 03/16/15 Page 5 of 8 Page ID#357 open other restaurants under the Gravity mark. Defendants respond that Plaintiff is not likely to succeed on the merits because (1) gravity is a term of art within the beer brewing industry, and is thus descriptive in the context of Defendants tap house; (2) Plaintiff operates a fine-dining establishment whereas Defendants operate a casual restaurant; (3) the overall impression of the parties marks differ significantly in color, font, and presentation; (4) evidence of actual confusion is due to carelessness by one consumer; (5) any Internet marketing is geographically limited; (6) consumers are sophisticated and will not confuse the restaurants; (7) Defendants chose their mark for its relation to craft brewing and for no reason related to Plaintiff; and (8) Defendants have no intention to expand the Gravity restaurant. Both Plaintiff and Defendants present persuasive arguments that, standing alone, might convince the Court that either has a strong case on the merits. At this point in the litigation, it is impossible to say with confidence that Plaintiff is likely to succeed on the merits. For instance, both parties presented evidence of Internet-based searches and restaurant reviews to demonstrate a likelihood (or not) that consumers would confuse the restaurants or impute one s reputation to the other. However, the reviews contained insufficient sample sizes and the searches produced inconsistent results. Further factual development is required to determine the effect of geographical proximity on the likelihood that consumers will confuse the restaurants. Moreover, both parties alluded to existing federal registrations for marks containing the term Gravity, but neither party sufficiently 5
Case 1:15-cv-00031-RHB Doc #18 Filed 03/16/15 Page 6 of 8 Page ID#358 explained how this Court should consider and weigh that evidence. Plaintiff has demonstrated a few instances of actual confusion, but these instances are insufficient to find a likelihood of confusion when considered alongside the other Frisch factors. The Court cannot conclude, therefore, that Plaintiffs have a strong likelihood of success so as to warrant the extraordinary remedy of a preliminary injunction. B. Risk of Irreparable Harm In order to obtain an injunction, a party must also show that it will suffer irreparable harm and that it has an inadequate remedy at law. United States v. Miami University, 294 F.3d 797, 816 (6th Cir. 2002). An injury is not fully compensable at law if money damages would be difficult to calculate. Basicomputer Corp. v. Scott, 973 F.2d 507, 511 (6th Cir. 1992). The loss of customer goodwill often amounts to irreparable injury because the damages flowing from such losses are difficult to compute. Id. at 512. Plaintiff claims it faces a risk of irreparable harm because any adverse comments or reviews about Defendants could adversely affect the Gravity name. Potential customers might accidentally read some of the negative reviews about Defendants and decide not to eat at Plaintiff s restaurant. Plaintiff points out that restaurants in Michigan do not enjoy strong profit margins, so any damage to its restaurant s reputation could affect its financial viability in incalculable ways. There is no evidence that a consumer imputed one party s reputation to the other party nor that Plaintiff has suffered any damage to its goodwill. Thus, the risk of irreparable harm 6
Case 1:15-cv-00031-RHB Doc #18 Filed 03/16/15 Page 7 of 8 Page ID#359 is too speculative to warrant the issuance of a preliminary injunction. C. Balance of the Equities Plaintiff claims that harm to its long-established reputation is greater than the harm to Defendants if they must change their name on signs and menus. As discussed above, the Court cannot conclude that Plaintiff is likely to succeed on the merits, nor that it will be irreparably harmed in the absence of an injunction. Therefore, the equities weigh in favor of maintaining the status quo until the parties develop a more thorough factual record and this Court can decide the case on the merits. D. Public Policy The parties identify public policy considerations inherent to trademark law, including protection for an owner of a valid trademark or servicemark and protection for the public from misleading or confusing products and services. Whether the public policy to protect a servicemark is implicated in this case depends on whether Plaintiff can establish it owns a protectable mark and there exists a likelihood of confusion. Because the Court cannot conclude at this time that Plaintiff is likely to succeed on the merits, it cannot conclude that public policy favors in injunction. III. For the foregoing reasons, the Court holds that the extraordinary remedy of a preliminary injunction is not warranted. 7
Case 1:15-cv-00031-RHB Doc #18 Filed 03/16/15 Page 8 of 8 Page ID#360 Accordingly, IT IS HEREBY ORDERED that Plaintiff s Motion for Preliminary Injunction (ECF No. 2) is DENIED. Dated: March 16, 2015 /s/ Robert Holmes Bell ROBERT HOLMES BELL UNITED STATES DISTRICT JUDGE 8