25 F. Supp. 3d 187
D.N.H.2014Background
- Plaintiff GL Newburyport (Mass.) registered the mark "GENERAL LINEN SERVICE" (GLS) with the USPTO, claiming continuous use since 1933; later filed an affidavit of continued use and obtained incontestable status after five years.
- Defendant GL Somersworth (N.H.), a regional competitor, received a cease-and-desist from GL Newburyport asserting exclusive rights in the GLS mark.
- GL Somersworth counterclaimed seeking cancellation of the federal registration for (I) fraudulent procurement and (II) genericness, and alleged (III) violation of the New Hampshire Consumer Protection Act, (IV) intentional interference (not challenged here), and (V) unfair competition under the Lanham Act and common law.
- GL Newburyport moved to dismiss Counts I, II, III, and V for failure to plead with required particularity or to allege necessary elements.
- The court evaluated Rule 12(b)(6) and Rule 9(b) standards, accepting well-pleaded facts and requiring heightened particularity for fraud allegations, but allowing factual inferences for other claims.
Issues
| Issue | Plaintiff's Argument (GL Newburyport) | Defendant's Argument (GL Somersworth) | Held |
|---|---|---|---|
| Count I: Fraudulent procurement of federal trademark | Dismiss: allegations are "on information and belief" and lack particularity; defendant failed to allege superior rights or that plaintiff knew of such rights | Allegations (supported by specific factual assertions about competing use, website use, gaps) sufficiently plead misrepresentations, scienter, and intent to deceive PTO | Denied. Court finds Rule 9(b) met for fraud based on alleged facts; superior-rights allegation not required for all fraud theories. |
| Count II: Genericness (cancellation) | Dismiss: no specific allegations of evidence showing public understanding that mark is generic | Mark may be challenged as generic; pleading need not detail the evidence in the complaint | Denied. Claim survives; plaintiff need not allege existence of specific evidence at pleading stage. |
| Count III: NH Consumer Protection Act (RSA ch. 358-A) | Dismiss: sending a cease-and-desist that defendant ignored cannot support CPA claim; no injury alleged | Enforcement of a fraudulently obtained or generic mark and groundless enforcement letters can constitute deceptive/unfair practices; statutory minimum damages/fees may be available without proof of actual damages | Denied. Court finds allegations sufficient at pleading stage to state a CPA claim. |
| Count V: Unfair competition (Lanham Act & common law) | Dismiss to extent it relies on dismissed counts | Alleged scheme to advance meritless claims and extract settlements supports unfair competition claim | Denied. Because Counts I and III survive, Count V survives as well. |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (establishes plausibility standard for pleading)
- Juarez v. Select Portfolio Servicing, Inc., 708 F.3d 269 (applying plausibility standard)
- Exergen Corp. v. Wal-Mart Stores, Inc., 575 F.3d 1312 (Rule 9(b) guidance re: allegations on information and belief)
- Patsy’s Italian Rest., Inc. v. Banas, 658 F.3d 254 (fraudulent procurement theories and requirements)
- Colt Defense LLC v. Bushmaster Firearms, Inc., 486 F.3d 701 (genericness is question of fact measured by public understanding)
- San Juan Prods., Inc. v. San Juan Pools of Kan., Inc., 849 F.2d 468 (fraud in procurement elements and pleading discussion)
- Axenics, Inc. v. Turner Const. Co., 164 N.H. 659 (CPA requires conduct reaching a level of rascality)
- Becksted v. Nadeau, 155 N.H. 615 (RSA 358-A:10 does not require proof of actual damages to recover statutory minimum and attorney’s fees)