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Health v. Gundersen Lutheran Health System, Inc.

United States District Court, W.D. Wisconsin

April 7, 2017

ESSENTIA HEALTH, Plaintiff,
v.
GUNDERSEN LUTHERAN HEALTH SYSTEM, INC. d/b/a ESSENTIAL HEALTH CLINICS, Defendant.

          OPINION AND ORDER

          WILLIAM M. CONLEY District Judge

         Plaintiff Essentia Health asserts trademark infringement claims, under both federal law, 15 U.S.C. § 1125(a)(1)(A), and state common law. In particular, plaintiff claims that defendant Gundersen Lutheran Health System, Inc., has been in business as “Essential Health Clinics” since July 2015, infringing Essentia's registered trademark of a confusingly similar name, “Essentia Health.” Before the court is plaintiff's motion for preliminary injunction to enjoin defendant's use of that mark. (Dkt. #4.) While a hearing on that motion was set for today, the court finds oral argument unnecessary. After reviewing the parties' submissions more carefully, the court will instead deny plaintiff's motion on the papers.

         ALLEGATIONS OF FACT

         A. The Parties

         Plaintiff Essentia Health is a Minnesota non-profit corporation with its principal place of business in Duluth, Minnesota. Essentia is an integrated health system, which operates 15 hospitals, 69 clinics, 7 long-term care facilities and other general and specialty health care facilities in Wisconsin, Minnesota, North Dakota and Idaho. As defendant emphasizes with respect to Wisconsin, which is the critical area for purposes of plaintiff's motion for preliminary injunction, Essentia facilities are limited to the northwestern-most portion of the state. Specifically, Essentia's Wisconsin facilities consist of Essentia Health St. Mary's Hospital -- Superior; Essentia Health St. Mary's --Superior Clinic; Essentia Health Convenient Care -- Superior; Essentia Health -- Ashland Clinic; Essentia Health -- Spooner Clinic; and Essentia Health -- Hayward Clinic.[1] In its amended proposed findings of facts, Essentia also stresses that it provides “reproductive health care services at some of its Wisconsin facilities, ” and that it provides those services to youth, among others. (Pl.'s Am. PFOFs (dkt. #23) ¶¶ 7-9.)

         Defendant Gundersen Lutheran Health System operates health care facilities exclusively in Wisconsin, although its affiliate, Gundersen Clinic Ltd., also operates clinics in Minnesota and Iowa. Gundersen is the sole corporate member of Essential Health Clinic, a non-profit corporation.[2] Essential Health Clinic is dedicated to comprehensive reproductive healthcare services, including testing and treatment of sexually-transmitted diseases, education and birth control, with a primary client base of youth ages 15 to 22. (Maas Decl. (dkt. #19) ¶ 5.) There are seven Essential Health Clinic locations in Western Wisconsin, including Black River Falls, La Crosse, Prairie du Chien, Richland Center, Sparta, Viroqua and Whitehall. Essential Health Clinic has no current presence outside of Wisconsin.

         B. Trademarks

         Essentia owns and uses in interstate commerce two federal trademark registrations: (1) ESSENTIA HEALTH. USPTO Serial No. 86554038, filed March 5, 2015, and registered November 3, 2015 (Mihalek Decl., Ex. 1 (dkt. #10-1); and (2)

         Image Omitted

USPTO Serial No. 86554033, filed March 5, 2015, and registered November 3, 2015 (Mihalek Decl., Ex. 2 (dkt. #10-2).

         Essentia filed for registration of the "Essentia Health" tradename with the Minnesota Secretary of State in November 2003, and it has used that mark in commerce since June 2004; it has used the "Essentia Health Here With You (with three-leaf logo design)" mark in commerce since September 2010. Essentia represents that since November 2003, it has expended significant time, money and other resources to conduct widespread marketing, advertising and other promotions in its territories relating to its health care services, providers and facilities using its trademarks. Its annual marketing budget since 2003 has ranged between $5 million and $9 million. Essentia further represents that it has made significant marketing, advertising and other promotional efforts to create strong affiliation and association in the public's mind between the Essentia marks and its facilities and services.

         C. Essential Health Care's Use of Mark

         In contrast, the defendant began operating under the name “Essential Health Clinic” in July 2015, with the intention of using that name as a trade name and trademark. Prior to that, Essential Health Clinic operated the same seven reproductive health clinics in Wisconsin under the name “Options Clinics.” Defendant represents that it changed its name in response to a January 2014 study “to assess the position of Options Clinic in the marketplace and to validate whether a rebrand was needed” and that “[t]he new name and symbol w[ere] chosen in response to feedback from focus group participants, qualitative research results and existing clients and staff.” (Maas Decl. (dkt. #19) ¶ 10.) Specifically, defendant selected “Essential Health Clinic” because it “allowed the clinic to strengthen its message that reproductive health clinics are essential to the health of the community based on its position that it's essential to have a place to go for reproductive health services regardless of an individual's ability to pay.” (Id. at ¶ 11.)

         In March 2015, defendant filed a trademark application with the USPTO disclosing its intent to use the name “Essential Health Clinic.” In November 2016, Essentia filed a notice of opposition with the USTPO's trademark trial and appeal board. At the time of its application, defendant had not yet begun to use the name in commerce. But along with the name change, defendant began using the four-leaf logo design set forth here, which plaintiff contends was intended to be confusingly similar to Essentia's three-leaf logo design:

         Image Omitted

         (Pl.'s PFOFs (dkt. #6) ¶ 17.)

         After Essentia became aware of defendant's actual use of the “Essential Health Clinic” name and mark, Essentia claims to have engaged in discussions with Gundersen representatives, informing them that Essentia objects to Gundersen's infringement of the Essentia marks. Defendant disputes this, stating that Essentia never requested that Gundersen cease using the name prior to filing its complaint.

         Both parties have conducted various internet searches of “Essential Health Clinic, ” and some of those searches yielded “Essentia Health” in the results.

         OPINION

         I. Standard of Review of Motion for Preliminary Injunction

         To show that it is entitled to a preliminary injunction, plaintiff must demonstrate (1) a likelihood of success on the merits, (2) that there is no adequate remedy at law, and (3) that it will suffer irreparable harm if an injunction is not granted. Promatek Indus., Ltd. v. Equitrac Corp., 300 F.3d 808, 811 (7th Cir. 2002). If plaintiff meets this burden, the court next considers “any irreparable harm an injunction would cause the nonmoving party, ” and finally “any consequences to the public from denying or granting the injunction.” Id. The greater the likelihood of plaintiff's success on the merits, “the less the balance of harms needs to weigh in its favor.” Id.

         II. Likelihood of Success on the Merits

          Plaintiff asserts claims for trademark infringement under the Lanham Act, 15 U.S.C. § 1125(a)(1)(A), as well as Wisconsin common law claims for trademark infringement and unfair competition. In considering whether an injunction is warranted, the court first considers whether plaintiff has demonstrated a likelihood of success on the merits of these claims. To meet this initial burden, plaintiff must show that it has a “‘better than negligible' change of succeeding on the merits.” Ty, Inc. v. Jones ...


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