1 MainBeado design patent infringement complaint

8/13/2019 1 MainBeado design patent infringement complaint

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UNITED STATES D IS TRIC T COURTFOR TH E E A ST E RN D IS TR IC T OF VIRGINIA

A LEXANDR I A DIV IS IONSTAT LTD . dba BEARDOP.M.B. 2, Caribbean PlaceProvidenciales, Turks Caicos Islands

Pla in t i f f

FILED

MIJ NOV 13 P inC fy ASrif7a cT COUALEXANDRA. VIRGINI

BEARD HEAD, INC.880 Apollo Street, Suite 140El Segundo, CA 90245BEARDED APPAREL LLC816 S. Bundy Avenue, No. 11Los Angeles, C 90049DAVID S TANKUNAS816 S. Bundy Drive, Suite 11Los Angeles, CA 90049NEON EATERS, LLC165 Nor th 1330 Wes t Suite A7Orem, UT 84057

Defendants .

CaseNo. r , \3 -&HW

COMPLA INT

Plaintiff states the following for its Complaint against defendants BEARD HEAD, INC.,BEARDED APPAREL LLC, DAVID STANKUNAS, and NEON EATERS (collectivelyDefendants ):

NATURE OF THE ACT ION

1. This is an action for injunctive relief and damages arising from Defendants'design patent infringement, trade dress infringement, and unfair competition in violation of thelaws of the UnitedStates and the laws of the CommonwealthofVirginia.

Case 3:13-cv-00762-HEH Document 1 Filed 11/13/13 Page 1 of 21 PageID# 1


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PARTIES2. Plaintiff STAT Ltd., d/b/a BEARDO ( BEARDO ) is a Limited Company

incorporated in the Turks and Caicos Islands. BEARDO's products are sold, and offered for sale,globally, including in this Judicial District, and they have received significant publicity for theirinnovative design. BEARDO owns Design Patent No. D692,186 for a combined ski facemaskand hat. BEARDO also has trade dress protection for its unique and distinctive productpackaging and product design.

3. On information and belief, Defendant BEARD HEAD, Inc. ( BEARD HEAD ) is

a California corporation with a principal place of business at 880 Apollo Street, Suite 140, ElSegundo, CA 90245.

4. BEARD HEAD has previously been accused of copying other designs. Forinstance, in January 2010, the Icelandic company Vik Prjonsdottir stated on their website:Sadly, it seems that honesty can be a difficult for some people and thats[sic] the case with thepeople behind the fake brand Beardhead. These people have copied Vik Prjonsdottir's Beardcap,started a company and are selling it around the world. Scandinavian Grace, our former retailersin New York, even have a documentation that they ordered a Beardcap from the store in January2008.

5. On information and belief, Defendant BEARDED APPAREL, Inc. ( BEARDEDAPPAREL ) is a California corporation with a principle place of business at 816 S. BundyAvenue, No. 11, Los Angeles, CA 90049. Plaintiff is informed and believes that BEARDEDAPPAREL and BEARD HEAD are the same entity, or that, alternatively, BEARDEDAPPAREL owns and/or cont rols BEARD HEAD.



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6. On information and belief, Defendant DAVID STANKUNAS ( STANKUNAS )owns and/or controls BEARDED APPAREL and BEARD HEAD. STANKUNAS, BEARDHEAD, and BEARDED APPAREL are referred to collectively herein as the BEARD HEADDEFENDANTS.

7. On information and belief, Defendant NEON EATERS LLC ( NEON EATERS )is a Utah limited liability company with a principal place of business at 165 North 1330 West,Suite A7, Orem, Utah 84057.

JURISD ICT ION AND VENUE

8. This action is for injunctive relief and for damages for design patent infringement,trade dress infringement, and unfair competition under the laws of the United States ofAmerica,and for trade dress infringement and unfair competition under the laws of the Commonwealth ofVirginia.

9. This actionarises under federal laws relating to design patent infringement arisingunder 35 U.S.C. 1 et seq., and under federal laws relating to trade dress infringement andunfair competition under the Lanham Act 43(a), 15U.S.C. 1125(a),

10. This Court has subject matterjurisdiction under28 U.S.C. 1331 and 1338(a).11. This Court has supplemental jurisdiction over the claims that arise under the laws

of the Commonwealthof Virginia pursuant to 28 U.S.C. 1367(a), because such claims are sorelated to the federal claims brought herein that they form partof thesamecaseor controversy.

12. Venue is properin thisCourt under28 U.S.C. 1338(a), 1391(b), and/or 1400(b).13. This Court has personal jurisdiction over the Defendants, who make their i tems

available for purchase to persons in this District through retail websites accessible to, anddirected towards, the citizens of the Commonwealth of Virginia. Further, the BEARD HEAD



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Defendants have systemic commercial contacts with this District, in that they sponsor events,festivals, and contests in this District, during which they promote and sell the infringing productsat issue subjudice.

GENERAL FACTS

14. BEARDO designs, creates, and sells apparel and accessories, including an arrayofBeard Hats, which are knit caps with an attached or an attachable face mask.

15. BEARDO's Beard Hats have received significant national and internationalpublicity. For instance, BEARDO's products have been featured on USAToday.com, on BBCRadio, in Cosmopolitan Magazine, in Canadian Geographic magazine, on Live with Kelly &Michael, on Ripley's Believe It or Not , and in a number of other publications, forums, andbroadcasts.

16. BEARDO has taken steps to protect its innovations and marks. BEARDO (and/orits owner) have secured patents in the United States, Canada, and the United Kingdom.BEARDO owns Design Patent No. D692,186, issued on October 22, 2013 ( the '186 patent ),for a combined ski facemask and hat. A copy of the ' 186 patent is attached as Exhibit A.

17. BEARDO (or any predecessors in interest) has owned all rights, title, and interestto the' 186 patent since the ' 186 patent issued.

18. BEARDO's ownership of the '186 patent includes, without limitation, theexclusive right to enforce the '186 patent, the exclusive right to file actions arising frominfringement of the '186 patent, the exclusive right to recover damages for infringement of the'186 patent, and the exclusive right to seek injunctive relief for infringement of the '186 patent.

19. In order to identify its products, including its combined ski facemask and hatproducts, BEARDO(and/or its owner) have investedsignificant time, effort, and money to create



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new and unique trade dress. This new and unique trade dress is embodied in the packaging ofBEARDO's combined ski facemask and hat products, and in the design ofBEARDO's combinedfacemask and hat products. BEARDO has acquired exclusive and protectable trade dress rightsembodied in this packaging and design, and has used and continues to use this trade dress. Thistrade dress, as a result of BEARDO's (and/or its owner's) extensive use, sales, and promotion,has become a valuable and important asset that designates the products as belonging exclusivelyto BEARDO.

20. The BEARDO brand is well known to consumers, and consumers identify thedesign of the combined facemask and hat as BEARDO products, or products emanating fromBEARDO, to distinguish BEARDO products from other products, and to identify the premiumquality and value ofBEARDO products.

21. BEARDO's design is inherently distinctive, or alternatively, has acquiredsecondary meaning. The famousness and popularity of BEARDO's design is reflected in thesignificant efforts BEARDO (and/or its owner) have taken to publicize its product, in thesignificant publicity BEARDO s design has received, and by its significant popularity amongstconsumers of combined ski facemasks and hats. For instance, BEARDO has, as ofNovember 13,2013, approximately 165,737 likes on its Facebook page seehttp://www.facebook.com/beardowear). Conversely, Defendant BEARD HEAD, hasapproximately 15,869 likes (see http://\vww.facebook.com/beardheads'> and Defendant NEONEATERS has approximately 350 likes (see http://vvavw.facebook.com/neoneaters1.BEARDO's designhas beenfamousbeforeDefendant's infringing activity.



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The BEARD HEAD Defendants Des ign Patent Infr ingement

22. On information and belief, the BEARD HEAD Defendants have offered for sale,sold, and continue to sell, in the United States, products with a design covered by the '186patent. These infringing products include the BEARD HEAD Stubble product, the BEARDHEAD Short product, and the BEARD HEAD Long product (depicted in Figure 1 below).

23. The BEARD HEAD Defendants' infringing Stubble, Short, and Longproducts are available for purchase on BEARD HEAD'S website, which is accessible to, anddirected towards, consumers in this District.

24. BEARDO has not authorized or licensed the BEARD HEAD Defendants (nor anyof the BEARD HEAD Defendants' agents, officers, or affiliates) to offer to sell or to sellproducts with a design covered by the ' 186 patent. The BEARD HEAD Defendants do not haveany license or authorization to do so.

25. Figure 1 below shows examples of the BEARD HEAD Defendants' infringingproducts by comparing figures from BEARDO's '186 patent (left) with images of someexemplary infringing products sold by the BEARD HEADDefendants (right).



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Figure 1; Comparison o f Exemplary Infringing BEARD HEAD Product s t o the ' 186 Pa ten t

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'186 Patent

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26. The BEARD HEAD Defendants have infringed and continue to infringeBEARDO's '186 patent at least by selling and/or offering to sell the infringing products withoutBEARDO's authorization or license.

27. BEARDO has sold and continues to sell products bearing the design claimed inthe ' 186 patent. BEARDO has provided notice of its patent directly to the BEARD HEADDefendants and to the public on BEARDO's website.

28. On information and belief, the BEARD HEAD Defendants' violations andcontinued violation of the ' 186 patent have been, and continue to be, intentional and willful.

NEON EATERS Design Patent Infringement29. On information and belief, NEON EATERS have offered for sale, sold, and

continue to sell, in the United States, products with a design covered by the '186 patent. Thisincludes the NEON EATERS Lumberjack and Santa beard hats.

30. NEON EATERS' infringing Lumberjack and Santa products are available forpurchase on NEON EATERS' website, which is accessible to, and directed towards, consumersin this District .

31. BEARDO has not authorized or licensed NEON EATERS (nor any of its agents,officers, or affiliates) to offer to sell or to sell products witha designcoveredby the ' 186patent.NEON EATERS has n o authorization or license to do so .

32. Figure 2 below shows examples of the NEON EATERS infringing products bycomparing figures from the ' 186 patent (left) with images of the exemplary infringing productssold by NEON EATERS (right).

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Figure 2; Comparison o f Exemplary Infringing NEON EATERS Productsto t h e 186 Patent

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1 86 Pa te nt Exemplary Infr inging NEON EATERS Product

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33. NEON EATERS has infringed and continue to infringe the ' 186 patent at least byselling and/or offering to sell the infringing products without BEARDO's authorization orlicense.

34. NEON EATERS has sold and continues to sell products bearing the designclaimed in the '186 patent. BEARDO has provided notice of its patent to the public onBEARDO's website.

35. On information and belief, NEON EATERS' violations and continued violationof the ' 186 patent have been, and continue to be, intentional and willful.

BEARD HEAD s Trade Dress Infringement and Unfair Competition Packaging)36. BEARDO has expended substantial time, effort, and money to create innovative,

unique, non-functional, and inherently distinct packaging for its products, including thecombined ski facemask and hat. This packaging identifies the source of the products asoriginating from BEARDO.

37. The BEARD HEAD Defendants knowingly and intentionally have sold, andcontinue to sell, without authorization or license, items in packaging that is identical (orsubstantially similar) in size, shape, color, graphics, and look to BEARDO's packaging.

38. Rather than undertake the effort to develop their own product packaging tradedress, the BEARD HEADDefendants simply copied BEARDO's product packaging trade dresscausing substantial consumer confusion anddilution ofBEARDO's intellectual property.

39. On or about August 21, 2013, at a trade show in Las Vegas, Mr. STANKUNAS,individually and on behalf of the BEARD HEAD Defendants, marketed infringing BEARDHEAD products to specialty retailers, distributors, and the public. At that trade show, whenasked about the similarity between the BEARD HEAD packaging and BEARDO's packaging,

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STANKUNAS indicated that BEARD HEAD copied BEARDO's packaging for its infringingproducts.

40. Figure 3 demonstrates the BEARDHEAD Defendants' trade dress infringementas to BEARDO's packaging. The top item in Figure 3 is the infringing BEARD HEADpackaging and the bottom item in Figure 3 is the original BEARDO packaging that the BEARDHEAD Defendants have infringed and continue to infringe.

Figure 3: Comparison o f BEARDO and BEARD HEAD Packaging

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BEARD HEA D and NEON EATERS Trade Dress Infringement and Unfair CompetitionDesign)

41. The design of the BEARD HEAD Defendants' infringing products (shown inFigure 1 above) and NEON EATERS' infringing products (shown in Figure 2 above) issubstantially similar to the design of BEARDO's combined ski facemask and hat, which is notessential to the use or purpose of the product, does not affect the cost or quality of the product (asevidenced, e.g. by the issuance of a design patent over the design), is distinctive, identifiesproducts as emanating from BEARDO, and which BEARDO has invested significant time,effort, and money in developing.

42. Defendants' trade dress infringement as to BEARDO's design has in fact causedand continues to cause confusion amongst consumers and retailers as to the origin of BEARDO'sproducts. BEARDO has, for example, received correspondence from retailers regarding whatthey believe to be BEARDO's superior products, when they are in fact carrying the BEARDHEAD Defendants' inferior and infringing product. Defendants' trade dress infringement as toBEARDO's design is likely to continue to cause consumer confusion.

43. Defendants' infringing products have diluted and tarnished the value of theBEARDObrand by associating the BEARDObrand with lower quality products.

COUNT 1: DESIGN PATENT INFR INGEMENT(Against All Defendants)

44. BEARDO incorporates by reference and re-alleges herein the foregoing andsubsequent paragraphs.

45. Defendants have made, offered to sell, sold, and/or imported into the UnitedStates, and are making, offering to sell, selling, and/or importing into the United States, productsthat infringe the '186 patent, without BEARDO's authorization or license.

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46. Examples of Defendants' infringing products are depicted in Figures 1 and 2above. Defendants will continue to manufacture, offer to sell, sell, and/or import their infringingproducts unless enjoined by this Court.

47. On information and belief, Defendants' infringement has been intentional andwillful, making this an exceptional case.

48. Due to Defendants' infringement of the ' 186 patent, BEARDO has suffered, issuffering, and will continue to suffer irreparable injury.

49. Due to Defendants' infringement of the ' 186 patent, Defendants have profited andare profiting, and BEARDO has been and is being damaged and losing profit. BEARDO isentitled to recover damages from Defendants, including, inter alia, the total profit derived byDefendants by their infringement of the '186 patent, in an amount to be proven at trial.

COUNT 2: FEDERAL UNFA IR COMPET IT ION ANDTRADE DRESS INFR INGEMENT (PRODUCT PACKAGING)

(Against The BEARD HEAD Defendants)50. BEARDO incorporates by reference and re-alleges herein the foregoing andsubsequent paragraphs.

51. BEARDO has acquired exclusive and protectable trade dress rights embodied inits non-functional and inherently distinctive product packaging for its combined ski facemaskand hat. By its acts and omissions, the BEARD HEAD Defendants violate Section 43(a) of theLanham Act and are unfairly competing with BEARDO.

52. The BEARD HEAD Defendants' use in commerce of BEARDO's productpackaging trade dress constitutes a false designation of origin and a false and misleadingrepresentation of fact that is likely to cause confusion, deception, and mistake. The BEARDHEAD Defendants' use of BEARDO's product packaging trade dress wrongly suggests thatBEARD HEAD's inferior products are affiliated, connected, or associated with BEARDO; that

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BEARD HEAD products are manufactured or distributed by BEARDO; or that BEARDO hassponsored, endorsed, or approved the BEARD HEAD products, services, and commercialactivities.

53. The BEARD HEAD Defendants have infringed, and on information and belief,continue to infringe, BEARDO's combined ski facemask and beard product packaging tradedress. The BEARD HEAD Defendants' beard hat products infringe BEARDO's productpackaging trade dress.

54. The BEARD HEAD Defendants' actions are intentional and willful, making thisan exceptional case. Their actions demonstrate malicious intent by the BEARD HEADDefendants to trade on goodwill associated with BEARDO, causing significant and irreparableinjury to BEARDO. This injury includes damage to BEARDO's goodwill and reputation, andBEARDO's ability to use its product packaging trade dress to indicate that its products comefrom BEARDO.

55. Due to the BEARD HEAD Defendants' infringement of BEARDO's productpackaging trade dress, BEARDO has suffered, is suffering, and will continue to sufferirreparable injury.

56. Due to the BEARD HEAD Defendants' infringement of BEARDO's productpackaging trade dress, the BEARD HEAD Defendants have profited and are profiting, andBEARDO has been and is being damaged and losing profit. BEARDO is entitled to recoverdamages from the BEARD HEAD Defendants, including, inter alia, the total profit derived bythe BEARD HEAD Defendants' infringement of BEARDO's trade dress, in an amount to beproven at trial.

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COUNT 3: FEDERAL UNFA IR COMPETITION ANDTRADE DRESS INFR INGEMENT (PRODUCT DESIGN)

(Against Al l Defendants)57. BEARDO incorporates by reference and re-alleges herein the foregoing and

subsequent paragraphs.58. BEARDO's trade dress is not essential to the use or purpose of the product and

does not affect the cost or quality of the product (as evidenced, e.g. by the issuance of a designpatent over the design), is famous, and is distinctive.

59. BEARDO has acquired exclusive and protectable trade dress rights embodied inits product design of its combined ski facemask and hat. By its acts and omissions, Defendantsviolate Section 43(a) of the Lanham Act and are unfairly competing with BEARDO.

60. The Defendants' use in commerce of BEARDO's product design trade dressconstitutes a false designation of origin and a false and misleading representation of fact that islikely to cause (and in fact has caused) confusion, deception, and mistake. Defendants ' use ofBEARDO's product design trade dress wrongly suggests that Defendants' products are affiliated,connected, or associated with BEARDO, that Defendants' products are manufactured ordistributed by BEARDO, or that BEARDO has sponsored, endorsed, or approved theDefendants' products, services, and commercial activities.

61. Defendants have infringed, and continue to infringe, BEARDO's combined skifacemask and beard product design trade dress. Defendants' beard hat products infringeBEARDO's product design trade dress.

62. On information and belief, Defendants' actions are intentional and willful, makingthis an exceptional case. Their actions demonstrate malicious intent by Defendants to trade ongoodwill associated with BEARDO, causing significant and irreparable injury to BEARDO. This

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injury includes damage to BEARDO's goodwill and reputation, and BEARDO's ability to use itsproduct design trade dress to indicate that its products come from BEARDO.

63. Due to the Defendants' infringement of BEARDO's product design trade dress,BEARDOhas suffered, is suffering, and will continue to suffer irreparable injury.

64. Due to Defendants' infringement of the BEARDO's product design trade dress,Defendants have profited and are profiting, and BEARDO has been and is being damaged andlosing profit. Therefore, BEARDO is entitled to recover damages from Defendants, including,interalia, the total profit derived by Defendants by their infringement of BEARDO's trade dress,in an amount to be proven at trial.

COUNT 4; COMMON LAW TRADE DRESS I NFR INGEMENTAND UNFA IR COMPET I TION

(Against the BEARD HEAD Defendants as to Product Packaging,and Against All Defendants as to Product Design)

65. BEARDO incorporates by reference and re-alleges herein the foregoing andsubsequent paragraphs.

66. BEARDO has acquired common law trade dress rights in its product packagingand product design for the combined ski facemask and hat. Defendants' acts described herein arelikely to confuse and deceive, and on information and belief are deliberately calculated toconfuse and deceive, citizens of the Commonwealth of Virginia and elsewhere as to the sourceand origin of their products.

67. Defendants ' conduct consti tutes violations of BEARDO's common law tradedress rights and also constitutes unfair competition under the laws of the Commonwealth ofVirginia.

68. On information and belief, Defendants' actions are intentional, willful, andundertaken with malice and in reckless disregard ofBEARDO's rights.

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69. Due to Defendants unfair competition and infringement ofBEARDO's trade dressrights, Defendants have profited and are profiting, and BEARDO has been and is being damagedand losing profit. Therefore, BEARDO is entitled to recover damages from Defendants,including, inter alia, injunctive relief and the total profit derived by Defendants by theirinfringement ofBEARDO's trade dress, in an amount to be proven at trial.

P R A Y E R FOR REL IEF

WHEREFORE, BEARDO respectfully prays for:A. Judgment that the BEARD HEAD Defendants willfully infringed the BEARDO

'186 Design Patent in violation of 35 U.S.C. 271(a);B. Judgment that NEON EATERS willfully infringed the BEARDO '186 Design

Patent in violation of 35 U.S.C. 271(a);C. An injunction against further infringementof the BEARDODesignPatent by any

and all Defendants, their agents, servants, employees, officers, and all otherscontrolled by any or all Defendants;

D. An award of damages adequate to compensate BEARDO for the patentinfringement that has occurred pursuant to 35 U.S.C. 284, which shall be trebledas a result ofDefendants' willful patent infringement, or an award ofDefendants'profits from their infringement pursuant to 35 U.S.C. 289,whichever is greater,together with prejudgment interest and costs;

E. An assessment of costs, including reasonable attorney fees, pursuant to 35 U.S.C. 285 with prejudgment interest;

F. Judgment that the BEARD HEAD Defendants willfully infringed BEARDO'sproduct packaging trade dress in violation of federal law and common law;

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G. Judgment that Defendants willfully infringed BEARDO's product design tradedress in violation of federal law and common law;

H. Judgment that Defendants competed unfairly with BEARDO;I. That Defendants, and their officers, employees, and agents be forthwith

preliminarily and thereafter permanently enjoined and restrained from infringingBEARDO's '186 Design Patent, from infringing BEARDO's trade dress rights,and from unfairly competing against BEARDO;

J. Judgment against Defendants to award BEARDO damages, lost profits,reasonable royalties, and other monetary amounts, including damages suffered onaccount of unfair competition and lost business opportunities, as authorized underthe Lanham Act and the common law of the Commonwealth ofVirginia;

K. Judgment that such damages be trebled;L. An order directing Defendants to pay punitive damages to BEARDO;M. Such other and further reliefas this Court deems just and proper.

J U R Y DEMAND

BEARDO demands a trial by jury.Respectfully submitted,

Date: November 13 , 2013DarueTS: Ward VSB 45978WARD WARD, PLLC2020 N Street, NWWashington, DC 20036(202)331-8160Email: [email protected] FOR PLAINTIFF


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