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Sream Inc. v. LB Smoke Shop, Inc.
1:16-cv-24936
S.D. Fla.
Jun 23, 2017
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Background

  • Sream, Inc. (licensee) sued LB Smoke Shop alleging Lanham Act trademark infringement, counterfeiting, false designation of origin, and FDUTPA violations based on sale of counterfeit RooR-branded water pipes.
  • RooR trademarks are federally registered in the name of Martin Birzle; Sream claims it is the exclusive U.S. licensee of those trademarks since August 1, 2013.
  • LB Smoke Shop moved to dismiss for lack of standing, arguing Sream failed to plead or show a chain of title or an assignment/license from the registered owner (Birzle).
  • The Court ordered Sream to amend and plead a complete chain of interest from the USPTO registrant to Sream; Sream filed an Amended Complaint and later attached the August 1, 2013 license agreement in its response.
  • The license agreement (between Birzle and Sream) purports to grant Sream an exclusive license and full enforcement rights; LB Smoke Shop argued the Amended Complaint still failed to comply with the Court’s order.
  • The Court denied LB Smoke Shop’s motion, finding Sream sufficiently alleged a complete chain of interest and provided competent proof (the license) showing standing to sue as an exclusive licensee.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Standing to sue under the Lanham Act Sream is the exclusive licensee of RooR marks and has enforcement rights, so it has standing equivalent to an assignee LB Smoke Shop: Sream failed to plead or show a chain of title; USPTO records list Birzle, not RooR or Sream, so no standing Court: Denied dismissal — Sream alleged Birzle = RooR and produced the August 1, 2013 exclusive license showing an unbroken chain of interest, satisfying standing
Sufficiency of amended pleading after court order Amended Complaint plus license exhibit prove exclusive license and enforcement rights Amended Complaint merely repackages prior defects and lacks documentary proof Court: Allegations and attached license, construed favorably, are adequate under Rule 12 standards; plaintiff met obligation to supply competent proof when jurisdiction was challenged

Key Cases Cited

  • Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (pleading must state a plausible claim)
  • Ashcroft v. Iqbal, 556 U.S. 662 (legal conclusions not presumed true; factual support required)
  • Lujan v. Defenders of Wildlife, 504 U.S. 555 (standing requires injury in fact and constitutionally cognizable interest)
  • Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (federal courts have limited jurisdiction)
  • McNutt v. Gen. Motors Acceptance Corp. of Indiana, 298 U.S. 178 (plaintiff bears burden to prove jurisdictional facts by competent proof)
  • Fin. Inv. Co. (Bermuda) v. Geberit AG, 165 F.3d 526 (exclusive licensee equated with assignee for standing to sue)
  • Fla. Virtual Sch. v. K12, Inc., 735 F.3d 1271 (no standing absent legal title to registered trademark)
Read the full case

Case Details

Case Name: Sream Inc. v. LB Smoke Shop, Inc.
Court Name: District Court, S.D. Florida
Date Published: Jun 23, 2017
Docket Number: 1:16-cv-24936
Court Abbreviation: S.D. Fla.