Like me, Judge Otis D. Wright of the Central District of California remembers KOOL. A former brand of menthol cigarettes, KOOL Brands and its owner ITG Brands, LLC have sued Capna Intellectual, claiming that Capna’s use of Bloom Brands’ nested “OO” in its marketing of packaged cannabis products violates and dilutes the KOOL brands. After a June 7 hearing in which Justice Wright urged the parties to agree on an appropriate preliminary injunction, on June 21, Justice Wright signed ITG’s revised proposal preliminary injunction, which was more limited and prohibited Bloom from using “OO” and / or nested circles in its marketing and promotional materials. This ultimately led to a settlement and permanent injunction stipulated released earlier this month. While the preliminary and stipulated permanent injunctions are relatively standard in form and may not be worth mentioning, there are a few points from the parties’ submission on the preliminary injunction and the hearing that are worth considering.
Based on my own review of the presentation and application of the Arts and crafts confounding risk factors, this case has been very close, and I might like not issued a preliminary injunction.
Bloom Brands’ most interesting argument didn’t fit any of the eight Arts and crafts The factors. Bloom Brands juxtaposed the fall of menthol cigarettes as a product and the consequent falls of brands affiliated with that product, including KOOL, with mass legalization and the rise of cannabis products and brands in the majority of markets. United States. For example, Bloom argued that the KOOL brands and its nested “OOs” may have had “a worldwide reputation for quality and authenticity” in the 1930s, but Bloom claimed that by 2021 the “reputation of KOOL is to sell addictive toxic carcinogens to minorities. Bloom also argued that on April 29, 2021, the FDA announced it would ban menthol cigarettes nationwide. In contrast, Bloom claimed that much of the country has moved towards legalizing the In short, Bloom made a compelling argument that the KOOL brands star had fallen, while the Bloom Brands star rose in such a way that any confusion was not just unintentional (a Arts and crafts factor), but would actually damage Bloom’s image (and benefit KOOL’s). This argument is convincing and undoubtedly covers many Arts and crafts factors, with respect to the strength of the marks, the actual confusion, the intention of the defendant in the choice of the mark and the likelihood of expansion into other markets. Perhaps the best KOOL replica is in the eighth Arts and crafts factor — likelihood of expansion into other markets — because even assuming menthol cigarettes are on the way out, after 88 years, KOOL should have the right to expand its use of nested OOs to cannabis if it decides. to do so in the future. Justice Wright noted a corollary to this potential retaliation during the June 7 hearing when he questioned whether “ITG’s goodwill could be compromised for the honest of us who might now think that KOOL entered the cannabis market and find it reprehensible even in California? “
From a purely theoretical point of view, I would have liked to see how this dispute unfolded. Among Geriatric Millennials and Gen Xers, KOOL is a strong brand and there is good reason to believe that there is a high likelihood of confusion. And as Justice Wright announced, this same demographic might be offended if they mistakenly believed that KOOL had ventured into cannabis, which could undermine KOOL’s goodwill. On the other hand, Bloom is not wrong to say that among the younger ones, KOOL has very little, if any, brand strength in large part due to the strict restrictions on cigarette advertising since late. 1990s. And the so-called “rights” of this younger demographic are also more likely to view menthol cigarettes as evil and cannabis as good, so any real confusion among consumers could actually benefit the consumer. KOOL and hurt Bloom, among this demographic. .
One also cannot help but wonder if an unwritten, ninth, non-Arts and crafts factor would have tipped the scales in favor of KOOL and against Bloom here. While the majority of states have legalized cannabis in one form or another, the federal government has not. Had he been forced to decide whether to issue a preliminary injunction against Bloom on the original papers alone, curious whether Judge Wright would have inclined to issue the injunction simply because Bloom is selling an illegal product federally.
Either way, Justice Wright did the parties a huge service by forcing them to come together and come up with a business solution to share the pain as well, which ultimately led to a settlement. Justice Wright even commented that he was tired after every hearing of half of the “angry parties”, and after advising the parties that if either party acted unreasonably, he would decide against it. unreasonable part, he sent them back to figure it out and gave them time to do so. And they did. Both sides benefited from Justice Wright’s pragmatic approach and, ultimately, “coolerThe heads prevailed. Congratulations to everybody.