Sazerac v. Hood River Answer, Affirmative Defenses, Counterclaim

7/29/2019 Sazerac v. Hood River Answer, Affirmative Defenses, Counterclaim

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1 DEFENDANT HOOD RIVER DISTILLERS, INC.,S ANSWER, AFFIRMATIVE

DEFENSES AND COUNTERCLAIM TO PLAINTIFF'S FIRST AMENDED

COMPLAINT

Robert D. Scholz, OSB#77337Megan L. Ferris, OSB#063404

[email protected]

[email protected], SCHOLZ & MARKS, P.C.

900 SW Fifth Avenue, Suite 1800Portland, OR 97204Phone: (503) 224-2165

Fax: (503) 224-0348

Attorneys for Defendant

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

PORTLAND DIVISION

SAZERAC COMPANY, INC.,

Plaintiff,

vs.

HOOD RIVER DISTILLERS, INC.,

Defendant.

Case No. 3:12-cv-02304-HU

DEFENDANT HOOD RIVER

DISTILLERS, INC.,S ANSWER,

AFFIRMATIVE DEFENSES AND

COUNTERCLAIM TO PLAINTIFF'S

FIRST AMENDED COMPLAINT

Defendant, HOOD RIVER DISTILLERS, INC. (Hood River), by and through its

attorneys, as set forth below, for its Answer, Affirmative Defenses and Counterclaim to the First

Amended Complaint (the Complaint) of Plaintiff, SAZERAC COMPANY, INC. (Sazerac),

states as follows:

ANSWER

1.

Paragraph 1 of the Complaint contains conclusions of law as to which no response is

required. To the extent a response is required, Hood River admits that Sazerac purports to bring

Case 3:12-cv-02304-HU Document 45 Filed 02/08/13 Page 1 of 25 Page ID#: 317


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COMPLAINT

this action under the Lanham Act as cited in Paragraph 1 of the Complaint. Hood River

otherwise denies the allegations of Paragraph 1 of the Complaint.

PARTIES

2.

Hood River admits upon information and belief the allegations of Paragraph 2.

3.

Hood River admits the allegations of Paragraph 3 of the Complaint.

JURISDICTION AND VENUE

4.

Hood River denies the allegations of Paragraph 4, except admits that Sazerac purports to

bring this action under the Lanham Act and state statutory and common laws.

5.


required. To the extent a response is required, Hood River admits that this Court has subject

matter jurisdiction over this action. Hood River otherwise denies the allegations in Paragraph 5

of the Complaint.

6.


required. To the extent a response is required, Hood River is without information sufficient to

form a belief as to the truth of the allegations in Paragraph 6 of the Complaint and therefore

denies same.



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COMPLAINT

7.


required. To the extent a response is required, Hood River denies the allegations of Paragraph 7

of the Complaint. However, Hood River admits that on December 20, 2012, the United States

District Court for the Western District of Kentucky entered a Memorandum Opinion [ECF 37]

and Order [38], in Case No. 3:12-CV-0079-CRS, finding that the Court lacked personal

jurisdiction over Hood River and transferring this case to the United States District Court for the

District of Oregon.

8.


required. To the extent a response is required, Hood River denies the allegations of Paragraph 8

of the Complaint. However, Hood River admits that on December 20, 2012, the United States

District Court for the Western District of Kentucky entered a Memorandum Opinion [ECF 37]

and Order [38], in Case No. 3:12-CV-0079-CRS, finding that the Court lacked personal

jurisdiction over Hood River and transferring this case to the United States District Court for the

District of Oregon.

FACTS

9.

Hood River denies the allegations of Paragraph 9, and avers that the allegations contain

conclusions of law to which no response is required.

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COMPLAINT

10.

Hood River lacks knowledge or information sufficient to form a belief about the truth of

the allegations in Paragraph 10 and therefore denies same.

11.



12.


the allegations in Paragraph 12.

13.



14.

Hood River admits only so much of the allegation of sentence 1 in Paragraph 14 that

states that Plaintiff has marketed and distributed cinnamon whiskey under the FIREBALL mark.

The images attached as Exhibit A speak for themselves. Hood River denies the allegations

contained in the seventh and eighth sentences of Paragraph 14, especially concerning the claim

of distinctiveness. Hood River lacks knowledge or information sufficient to form a belief about

the truth of the remaining allegations in Paragraph 14 and therefore denies same.

15.





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COMPLAINT

16.



17.



18.



19.



20.

Hood River denies that FIREBALL functions as a trademark. Hood River lacks

knowledge or information sufficient to form a belief about the truth of the allegations in

Paragraph 20 and therefore denies same.

21.

Hood River admits only so much of the allegation of sentence 1 in Paragraph 21 that

states that Plaintiff markets a cinnamon liqueur under the FIRE WATER brand. The image

attached as Exhibit B speaks for itself. Hood River denies the allegations contained in the sixth

sentence of Paragraph 21, especially concerning the claim of distinctiveness. Hood River lacks



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COMPLAINT

knowledge or information sufficient to form a belief about the truth of the remaining allegations

in Paragraph 21 and therefore denies same.

22.

Hood River denies that FIRE WATER functions as a trade mark. Hood River lacks

knowledge or information sufficient to form a belief about the truth of the allegations in

Paragraph 22 and therefore denies same.

23.

The allegations of Paragraph 23 contain conclusions of law to which no response is

required. To the extent a response is required, Hood River denies the validity of the registrations

and common law mark identified in Paragraph 23. Hood River lacks knowledge or information

sufficient to form a belief about the truth of the remaining allegations in Paragraph 23 and

therefore denies same. Hood River respectfully refers the Court to Plaintiffs trademark

registration certificates for a complete and accurate statement of their contents.

24.



25.


the allegations in Paragraph 25 and therefore denies same, except admits upon information and

belief that Plaintiff or its affiliates markets products in the United States.

26.

Hood River denies the allegations of Paragraph 26 of the Complaint.



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COMPLAINT

27.

The allegations of Paragraph 27 contain conclusions of law to which no response is

required. To the extent a response is required, Hood River denies those allegations in Paragraph

27 of the Complaint.

28.

Hood River admits that it filed an intent-to-use application, Serial No. 85/400560,

with the U.S. Patent and Trademark Office on August 17, 2011 for SINFIRE for distilled

products. Hood River otherwise denies the allegations in Paragraph 28 of the Complaint.

29.

Hood River admits the allegations in Paragraph 29 of the Complaint.

30.


31.

Hood River admits the allegations in Paragraph 31 of the Complaint to the extent

it has shipped to thirty five states and has listings in 40 states.

32.


33.


34.




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COMPLAINT

35.

Hood River admits the allegations in Paragraph 35 to the extent that Hood River sold

PENDLETON Whisky and PENDLETON 1910 Whisky in Kentucky. Hood River denies that it

has sold BROKERS American Blended Whiskey in Kentucky but admits BROKERS London

Dry Gin has been sold in Kentucky. Hood River otherwise denies the allegations of Paragraph

35 of the Complaint.

36.

The bottle and the label identified in Paragraph 36 of the Complaint speak for

themselves. Hood River admits that the Certificate/Exemption of Label/Bottle Approval

(COLA) attached to the Complaint as Exhibit C and printout of Hood Rivers website attached

to the Complaint as Exhibit D identify the bottle and label under which Hood River offers

SINFIRE. To the extent that the description in Paragraph 36 of the Complaint differs from the

actual bottle and label as well as the COLA and website, Hood River denies the allegations in

Paragraph 36 of the Complaint.

37.


required. To the extent allegations are construed to be allegations of fact, Hood River denies

them. Hood River further denies that FIREBALL and FIRE WATER function as trademarks.

38.

Hood River denies the allegations in Paragraph 38 of the Complaint.

//

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COMPLAINT

39.

To the extent that Sazerac has not defined challenge shot or I dare you to try it

category of beverage, Hood River is without information sufficient to form a belief as to the truth

of the allegations in Paragraph 39 of the Complaint and therefore denies them.

40.

Hood River admits that it has knowledge of the existence of Sazeracs products that bear

the terms fireball and fire water. Hood River otherwise denies the allegations in Paragraph

40 of the Complaint

41.


42.

Hood River is without information sufficient to form a belief as to the truth of the

allegations in Paragraph 42 and therefore denies same, except that Hood River admits SINFIRE

is sold in retail outlets.

43.


44.


45.




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COMPLAINT

46.


47.


48.


49.

Hood River denies the allegations in Paragraph 49 of the Complaint. However, Exhibit E

comprises public documents and they can speak for themselves.

50.

Hood River states that the December 27, 2011 letter attached to the Complaint as Exhibit

F speaks for itself. Hood River admits that it issued a press release on January 30, 2012

announcing that SINFIRE would become available for national distribution in February 2012.

Hood River otherwise denies the allegations in Paragraph 50 of the Complaint.

FIRST CLAIM FOR RELIEF

51.

Hood River repeats, realleges, and incorporates by reference its responses to Paragraphs 1

through 50 as if fully set forth herein.

52.

The trademark registrations identified in Paragraph 52 of the Complaint are public

records and can speak for themselves. Hood River denies the validity of the trademark



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COMPLAINT

registrations identified in Paragraph 52 of the Complaint. Hood River otherwise denies the

allegations in Paragraph 52 of the Complaint.

53.

The allegations contained in Paragraph 53 of the Complaint constitute conclusions of law

as to which no response is required. To the extent that a response is required, Hood River denies

the allegations of Paragraph 53.

54.




55.




56.




//

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COMPLAINT

57.




SECOND CLAIM FOR RELIEF

58.



59.

Hood River denies that Sazerac has developed goodwill in the FIREBALL mark because

FIREBALL fails to function as a trademark. Hood River is without information sufficient to

form a belief as to the truth of the remaining allegations in Paragraph 59 of the Complaint and

therefore denies them.

60.

Hood River denies that Sazerac has developed goodwill in the FIRE WATER mark

because FIRE WATER fails to function as a trademark. Hood River is without information

sufficient to form a belief as to the truth of the remaining allegations in Paragraph 60 of the

Complaint and therefore denies them.

61.


62.




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COMPLAINT

THIRD CLAIM FOR RELIEF

63.



64.


65.


66.




67.


68.


69.


70.


//

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COMPLAINT

FOURTH CLAIM FOR RELIEF

71.



72.


73.


74.


75.


76.


PRAYER FOR RELIEF

77.

Hood River requests the Court deny the relief requested by Sazerac in Paragraphs A

through G of the section of the Complaint entitled PRAYER FOR RELIEF.

*** *** ***



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COMPLAINT

AFFIRMATIVE DEFENSES

Hood River does not assume the burden of proof with respect to the defenses set forth

below where the substantive law provides otherwise. As separate and distinct affirmative

defenses to Sazeracs First Amended Complaint, Hood River alleges as follows:

78.

FIRST AFFIRMATIVE DEFENSE

The Complaint and every allegation contained therein fails to state any claim upon which

relief may be granted against Hood River.

79.

SECOND AFFIRMATIVE DEFENSE

Sazeracs claims are barred in whole, or in part, by the statute of limitations.

80.

THIRD AFFIRMATIVE DEFENSE

Sazerac can recover nothing on its trademark and trade dress infringement claims because

the alleged trademarks and trade dress are not distinctive.

81.

FOURTH AFFIRMATIVE DEFENSE

Sazerac has suffered no damages as a result of any action or omission of Hood River.

82.

FIFTH AFFIRMATIVE DEFENSE

Sazerac has used, and continues to use, whatever trademark or trade dress rights it may

have, the validity of which are specifically denied, with the intent and result of restraining trade



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COMPLAINT

and of injuring competition, such that Sazeracs alleged trademark rights and/or trade dress rights

are unenforceable in this action.

83.

SIXTH AFFIRMATIVE DEFENSE

There is no cognizable likelihood of confusion arising from the selection, adoption or use

of SINFIRE.

84.

SEVENTH AFFIRMATIVE DEFENSE

Sazerac can recover nothing on its trademark and trade dress claims because the alleged

trademarks and trade dress lack secondary meaning.

85.

EIGHTH AFFIRMATIVE DEFENSE

Sazerac can recover nothing on its trademark and trade dress claims because the alleged

trademarks and trade dress are functional.

86.

NINTH AFFIRMATIVE DEFENSE

Sazerac can recover nothing because of Sazeracs unclean hands.

87.

TENTH AFFIRMATIVE DEFENSE

Sazeracs claims are barred by the doctrine of fair use.

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COMPLAINT

88.

ELEVENTH AFFIRMATIVE DEFENSE

Sazeracs claims are barred by the equitable doctrines of laches, estoppel, waiver and

acquiescence.

89.

TWELFTH AFFIRMATIVE DEFENSE

Defendant denies that Sazeracs federal trademark registrations for FIREBALL

(3,550,110), FIREBALL & Design (3,734,227), FIREBALL (2,852,432) and FIRE WATER

(1,819,150) are valid registrations because the marks are or have become generic when used in

connection with whiskey and alcoholic beverages. Such use is, therefore, not entitled to the legal

presumptions awarded to a federal trademark owner by the issuance of a federal trademark

registration and such registrations are subject to cancellation under Section 14 of the Lanham

Act, 15 U.S.C. 1064.

90.

THIRTEENTH AFFIRMATIVE DEFENSE

For the reasons as set forth with particularity in Hood Rivers Counterclaim, Sazerac is

not entitled to maintain this suit or to assert infringement by Hood River by reason that the terms

FIRE WATER and FIREBALL are, or have become, generic for the registered goods.

91.

FOURTEENTH AFFIRMATIVE DEFENSE

Sazerac cannot show irreparable injury, and therefore is not entitled to injunctive relief.



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COMPLAINT

92.

FIFTEENTH AFFIRMATIVE DEFENSE

Hood River reserves its right to assert additional defenses and counterclaims as

information supportive of those defenses and counterclaims is discovered.

*** *** ***

COUNTERCLAIM

Defendant/Counterclaimant, Hood River Distillers, Inc. (Hood River) for its

Counterclaim against Plaintiff/Counter-Defendant Sazerac, Inc. (Sazerac), states as follows:

93.

This Counterclaim arises under the Lanham Act, 15 U.S.C. 1501, et seq., and seeks

cancellation of Sazeracs United States Trademarks: FIREBALL (3,550,110), FIREBALL &

Design (3,734,227), FIREBALL (2,852,432) and FIRE WATER (1,819,150).

PARTIES

94.

Hood River is an Oregon corporation having its principal place of business in Hood

River, Oregon.

95.

Sazerac is a Louisiana corporation having its principal place of business in New Orleans,

Louisiana.

//

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COMPLAINT

JURISDICTION AND VENUE

96.

This Court's jurisdiction arises from the fact that this is an action arising under the

trademark laws of the United States, 15 U.S.C. 1051 et seq., jurisdiction being conferred in

accordance with 15 U.S.C. 1064, 1121 and 1125 and 28 U.S.C. 1331, 1338 and 1367.

97.

Venue is proper under 28 U.S.C. 1391(b) because Sazerac conducts regular and

systematic business in this district, committed the tortuous conduct in this district, and/or a

substantial part of the events or omissions giving rise to the claim occurred in this district.

FACTS

98.

On information and belief, Sazerac procured federal trademark registrations for

FIREBALL for liqueurs (Reg. No. 2,852,432), FIREBALL for whiskey (Reg. No. 3,550,110)

and FIREBALL and Design for whiskey (Reg. No. 3,734,227) (Collectively FIREBALL

Registrations).

99.

On information and belief, Sazerac procured federal trademark registrations for FIRE

WATER for liqueurs (Reg. No. 1,819,150) (FIRE WATER Registration).

100.

The term fire water refers to an alcoholic beverage.

//

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COMPLAINT

101.

Fire Water is defined in various dictionaries to mean: [s]trong liquor, especially

whiskey, AMERICAN HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE (4th ed., Houghton

Mifflin Company, 2000); alcoholic liquor: now humorous, WEBSTERS NEW UNIVERSAL

UNABRIDGED DICTIONARY, (2nd ed., Dorest & Baber 1983); and strong alcoholic drink,

WEBSTERS THIRD NEW INTERNATIONAL DICTIONARY (Merriam Webster, Inc., 1993).

102.

The term fire is used by third parties to refer to recipes for alcoholic beverages that do

not include Sazeracs products.

103.

The term fire is used generically by third parties to refer to alcoholic beverages that

include cinnamon flavoring.

104.

The term fire is used generically by third parties to refer to alcoholic beverages that

include any spicy flavoring, such as hot sauce.

105.

The term fire is used in marks for alcoholic beverages not owned or licensed by

Sazerac.

106.

On information and belief, Sazerac had actual knowledge prior to filing the Complaint in

this action that fire water means any alcoholic liqueur among consumers.



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COMPLAINT

107.

A fireball is an alcoholic drink that includes an alcohol and a spicy flavoring element,

such as cinnamon or hot sauce.

108.

Published recipes for alcoholic drinks refer to drinks that include an alcohol and a spicy

flavoring element, such as cinnamon or hot sauce, as a fireball.

109.

Sellers of whiskey-based alcoholic drinks may use the term fireball as an apt

description of their goods and services because the term is generic for a whiskey-based alcoholic

drink.

110.

On information and belief, Sazerac had actual knowledge prior to filing the Complaint in

this action that fireball means a whiskey-based alcoholic drink among consumers.

111.

Sazerac claims, which Hood River expressly denies, that SINFIRE is likely to cause

confusion with the FIREBALL Registrations and FIRE WATER Registration.

112.

Hood River will be irreparably damaged if Sazerac is allowed to maintain the

FIREBALL Registrations and FIRE WATER Registration.



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COMPLAINT

COUNT I

COUNTERCLAIM FOR CANCELLATION OF FIRE WATER

113.

Hood River repeats, realleges, and incorporates by reference Paragraphs 93 through 112

of the Counterclaim as if fully set forth herein.

114.

Fire water refers to the class or category of alcohols, such as liqueurs, which are the

goods for which Sazerac has registered the FIRE WATER Registration.

115.

The primary significance of the term fire water to the purchasing public is an

identification of a beverage being an alcoholic beverage, such as liqueur.

116.

The FIRE WATER Registration is a generic term for the identified goods.

117.

Fire water is generic for liqueur within the meaning of 15 U.S.C. 1052(e)(1) and

Section 14 of the Trademark Act, 15 U.S.C. 1064.

COUNT II

COUNTERCLAIM FOR CANCELLATION OF FIREBALL

118.

Hood River repeats, realleges, and incorporates by reference Paragraphs 93 through 112

of the Counterclaim as if fully set forth herein.

//

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COMPLAINT

119.

Fireball refers to the class or category of alcohols, including one comprising of

whiskey, which are the goods for which Sazerac has registered the FIREBALL Registrations.

120.

The primary significance of the term fireball to the purchasing public is an

identification of a beverage being an alcoholic beverage, including one comprising of whiskey,

and including a spicy flavoring element, such as cinnamon or hot sauce.

121.

The FIREBALL Registrations are generic terms for the identified goods.

122.

Fireball is generic for liqueur and/or whiskey within the meaning of 15 U.S.C.

1052(e)(1) and Section 14 of the Trademark Act, 15 U.S.C. 1064.

//

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COMPLAINT

PRAYER FOR RELIEF

Wherefore, given Hood Rivers above Answer and Counterclaim, Hood River

respectfully requests that this Court grant it the following relief:

1. That the Complaint be dismissed with prejudice and judgment granted in Hood Rivers

favor;

2. That the Court direct the United States Commissioner For Trademarks, pursuant to 15

U.S.C. 1119, to cancel Sazeracs United States Trademark Reg. No. 2,852,432, Reg. No.

3,550,110, Reg. No. 3,734,227 and Reg. No. 1,819,150;

3. That the Court award Hood River its attorneys fees in connection with this litigation,

this being an exceptional case pursuant to the Lanham Act, 15 U.S.C. 1051 et seq.;

4. That the Court award Hood River its costs in connection with this litigation;

5. A trial by jury on all claims; and

6. Such other and further relief as the Court may deem just and proper.

JURY DEMAND

Hood River demands a trial to a jury on all issues so triable.

DATED: February 7, 2013

Respectfully submitted,

MacMILLAN, SCHOLZ & MARKS, P.C.

s/Megan L. Ferris

ROBERT D. SCHOLZ, OSB #77337

MEGAN L. FERRIS, OSB #063404Of Attorneys for Defendant

Hood River Distillers, Inc.



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COMPLAINT

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that I served the foregoing DEFENDANT HOOD RIVER

DISTILLERS, INC.,S ANSWER, AFFIRMATIVE DEFENSES AND COUNTERCLAIM

TO PLAINTIFF'S FIRST AMENDED COMPLAINT upon the following attorney on the 7

th

of February, 2013 via First Class Mail at the addresses listed below.

Scott P. Zoppoth

The Zoppoth Law Firm1600 Kentucky Home Life Building

239 South Fifth Street

Louisville, KY 40202Telephone: (502) 568-8884

Fax: (502) 568-1319

[email protected]

Peter J. Willsey

[email protected] LLP

777 6th Street, NW, Ste 1100

Washington, D.C. 20001

Telephone: (202) 842-7800Fax: (202) 842-7899

Todd S. [email protected]

Lori F. Mayall

[email protected] LLP

5 Palo Alto Sq., 3000 El Camino Real

Palo Alto, CA 94306-2155Telephone: (650) 843-5000

Fax: (650) 849-7400

Attorneys for Plaintiff Sazerac Company, Inc.

Respectfully submitted,

MacMILLAN, SCHOLZ & MARKS, P.C./s/Megan L. Ferris

ROBERT D. SCHOLZ, OSB #77337

MEGAN L. FERRIS, OSB #063404Of Attorneys for Defendant Hood

River Distillers, Inc.


Documents

Sazerac v. Hood River Answer, Affirmative Defenses, Counterclaim