GS Holistic, LLC v. Muthanna
2:24-cv-01641
| E.D. Cal. | Jul 25, 2025Background
- GS Holistic, LLC sued Taher Mohammed Ali Muthanna d/b/a Tower Zone Smoke Shop for federal trademark counterfeiting/infringement and federal false designation of origin, claiming unauthorized sale of products using their “Stündenglass” marks.
- GS Holistic alleged it owns three federal trademark registrations covering “Stündenglass” for specified product classes and has marketed these goods nationwide.
- Plaintiff claimed its investigator purchased a counterfeit ‘Gravity Infuser’ with the trademarks at Defendant’s store.
- Defendant failed to appear, and default was entered; Plaintiff moved for default judgment seeking various remedies including damages and injunctive relief.
- The Court reviewed the motion under the Eitel factors, scrutinizing the sufficiency of the complaint’s factual allegations, especially in light of similar claims recently brought by GS Holistic in other cases.
- The Court denied the motion without prejudice and dismissed the complaint with leave to amend, citing failures in adequately pleading key elements of the claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Trademark Infringement | Defendant sold goods with marks identical/substantially similar to Plaintiff’s registered marks | None (default; no appearance) | Complaint’s allegations too vague and conclusory; fails to state a claim |
| Counterfeiting | Items sold are not genuine and bear the Stündenglass marks | None | Complaint lacks detailed facts on counterfeit nature; insufficient pleading |
| Likelihood of Confusion | Defendant’s conduct likely causes consumer confusion | None | Conclusions are unsupported; lacks required factual detail |
| False Designation of Origin | Same factual basis as infringement; use likely to mislead consumers regarding origin of goods | None | Insufficient pleading for same reasons as trademark infringement |
Key Cases Cited
- PepsiCo, Inc. v. Cal. Sec. Cans, 238 F. Supp. 2d 1172 (C.D. Cal. 2002) (describes factors for default judgment discretion)
- NewGen, LLC v. Safe Cig, LLC, 840 F.3d 606 (9th Cir. 2016) (court discretion on default judgments)
- Grocery Outlet Inc. v. Albertson’s Inc., 497 F.3d 949 (9th Cir. 2007) (elements to plead trademark infringement)
- Jada Toys, Inc. v. Mattel, Inc., 518 F.3d 628 (9th Cir. 2008) (likelihood of confusion test applies to both infringement and false designation claims)
- Freecycle Network, Inc. v. Oey, 505 F.3d 898 (9th Cir. 2007) (false designation of origin claim requires likely consumer confusion)
- Applied Info. Scis. Corp. v. eBAY, Inc., 511 F.3d 966 (9th Cir. 2007) (registration creates presumption of trademark validity)
- Paulsen v. CNF Inc., 559 F.3d 1061 (9th Cir. 2009) (legal conclusions in the form of factual allegations are insufficient)
- Brookfield Commc’ns, Inc. v. W. Coast Ent. Corp., 174 F.3d 1036 (9th Cir. 1999) (false designation of origin as unfair competition)
- Aldabe v. Aldabe, 616 F.2d 1089 (9th Cir. 1980) (denial of default judgment where complaint fails to state a claim)