Moroccanoil, Inc. v. Zotos International, Inc.
230 F. Supp. 3d 1161
C.D. Cal.2017Background
- Moroccanoil (plaintiff) owns registered, incontestable trademarks and a distinctive trade dress for argan-oil hair products (turquoise packaging, copper/orange elements, vertical/horizontal "M" designs) and sells in premium channels since 2007.
- Zotos (defendant) formerly discussed a manufacturing relationship with Moroccanoil (NDA signed 2014) but launched a competing line, "Luxe Majestic Oil," in 2016 sold primarily at Sally Beauty; packaging uses white vertical lettering, an orange symbol, and a blue background.
- Moroccanoil sued for trademark and trade dress infringement and other claims and moved for a preliminary injunction to enjoin Zotos’ current packaging and promotional materials.
- Key disputed issues: validity/enforceability of Moroccanoil’s trade dress, likelihood of consumer confusion (Sleekcraft factors), evidence of actual confusion (survey challenged by Zotos), irreparable harm to Moroccanoil’s premium reputation, and appropriate bond amount if injunction issues.
- The court held Moroccanoil’s trademarks and trade dress are nonfunctional and inherently distinctive, found "serious questions" (and several factors favoring Moroccanoil) on likelihood of confusion, concluded irreparable harm was likely, and granted a preliminary injunction with a $250,000 bond.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Validity/enforceability of trademarks and trade dress | Moroccanoil: registered, incontestable marks; trade dress is nonfunctional and inherently distinctive | Zotos: individual elements (vertical lettering, amber bottle, turquoise color) are common/functional; trade dress not protectable | Court: Marks valid and enforceable; trade dress nonfunctional and inherently distinctive — protectable |
| Likelihood of confusion (Sleekcraft factors) | Moroccanoil: similarities in overall packaging, convergent channels, survey shows confusion; commercial strength favors Moroccanoil | Zotos: names differ ("Majestic" v. "Moroccanoil"), survey flawed, different retail channels and price points | Court: "Serious questions" exist and several Sleekcraft factors favor Moroccanoil (similarity of overall trade dress, strength, proximity, marketing overlap); injunction appropriate as to packaging (not the name) |
| Evidence of actual confusion (survey) | Moroccanoil: Kamins survey shows 41% association of Majestic with Moroccanoil | Zotos: Ericksen critique — wrong survey design, wrong universe, failed controls | Court: Survey has limitations but is some evidence of confusion; given online co-listings and other factors, it slightly favors Moroccanoil |
| Irreparable harm and balance of equities; bond amount | Moroccanoil: reputational harm and loss of premium goodwill (expert Decker) justify injunction; low bond requested | Zotos: injunction would impose substantial recall, repackaging, storage and lost-profit costs; requested $2.5M bond | Court: Likely irreparable harm to Moroccanoil; equities tip sharply to Moroccanoil; public interest favors avoiding confusion; bond set at $250,000 (declining buy-back and speculative lost-profit awards) |
Key Cases Cited
- Winter v. Natural Res. Def. Council, 555 U.S. 7 (2008) (plaintiff must show likelihood of irreparable harm for preliminary injunction)
- Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127 (9th Cir. 2011) (sliding-scale approach: serious questions + hardship tipping sharply may suffice)
- AMF, Inc. v. Sleekcraft Boats, 599 F.2d 341 (9th Cir. 1979) (eight-factor likelihood-of-confusion test)
- Brookfield Communications, Inc. v. West Coast Entertainment Corp., 174 F.3d 1036 (9th Cir. 1999) (marks’ strength and trade dress principles)
- Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 (1992) (inherently distinctive trade dress protects without proof of secondary meaning)
- TrafFix Devices, Inc. v. Marketing Displays, Inc., 532 U.S. 23 (2001) (trade dress functionality doctrine)
- Qualitex Co. v. Jacobson Products Co., 514 U.S. 159 (1995) (color and trade-dress distinctiveness/functionality principles)
- Wal‑Mart Stores, Inc. v. Samara Bros., 529 U.S. 205 (2000) (distinction between inherently distinctive and product-design trade dress)
- Network Automation, Inc. v. Advanced Systems Concepts, Inc., 638 F.3d 1137 (9th Cir. 2011) (consideration of commercial strength and survey evidence in confusion analysis)
- GoTo.com v. Walt Disney Co., 202 F.3d 1199 (9th Cir. 2000) (similarity of marks is critical in likelihood-of-confusion analysis)