United States District Court District of Massachusetts

Case 1:11-cv-11463-DPW Document 1
Filed 08/16/11 Page 1 of 14
UNITED STATES DISTRICT COURT DISTRICT OF MASSACHUSETTS
PURE ENCAPSULATIONS, INC. Plaintiff, v. iHERB, INC.
Defendant.
) ) ) ) ) ) ) ) ) ) )
Civil Action No. ____________
JURY TRIAL DEMANDED
COMPLAINT Plaintiff Pure Encapsulations, Inc. (Plaintiff, its predecessors in interest, and its related companies are collectively referred to as Pure Encapsulations) alleges as follows, upon actual knowledge with respect to itself and its own acts, and upon information and belief as to all other matters. NATURE OF THE CASE 1. This is an action for trademark infringement, false advertising, and unfair
competition under the Lanham Act, 15 U.S.C. 1051, et seq., a violation of M.G.L. c. 93A, and/or Massachusetts common law. THE PARTIES 2. Plaintiff Pure Encapsulations is a corporation organized under the laws of the State
of Delaware with a place of business at 490 Boston Post Road, Sudbury, MA 01776. 3. Defendant iHerb, Inc. is a corporation of the State of California with a place of
business at 17825 Indian Avenue, Moreno Valley, CA 92551.
JURISDICTION AND VENUE 4. This action arises under the federal Trademark Act, 15 U.S.C. 1051, et seq., and
the related law of the Commonwealth of Massachusetts. This Court has jurisdiction over the subject matter of this action pursuant to 15 U.S.C. 1121 and 28 U.S.C. 1331, 1338(a) and (b). Because the parties are citizens of different states and the matter in controversy exceeds $75,000 exclusive of interest and costs, this Court also has jurisdiction under 28 U.S.C. 1332. This Court has supplemental jurisdiction over Pure Encapsulations state-law claims pursuant to 28 U.S.C. 1367(a) because those claims are substantially related to Pure Encapsulations federal claims. 5. This Court has personal jurisdiction over Defendant and venue is proper in this
district pursuant to 28 U.S.C. 1391(b) and (c) because Pure Encapsulations is located and is being harmed in this district, Defendant conducts business in this district, including through its interactive website at <www.iherb.com>, and the activity about which Pure Encapsulations complains has taken place and is continuing to take place in this district. PURE ENCAPSULATIONS AND ITS BUSINESS 6. Pure Encapsulations is a premier provider of nutritional supplements and other
personal care items sold to healthcare professionals throughout North America. Since its inception, it has been an industry leader in manufacturing excellence and quality control, making Pure Encapsulations the choice of more than 36,000 health professionals in the U.S. 7. Only licensed healthcare professionals may order products from Pure
Encapsulations.
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8.
Since at least as early as 1991, Pure Encapsulations has marketed and sold its
products under the house mark PURE ENCAPSULATIONS throughout the United States, and beyond. In addition to the PURE ENCAPSULATIONS house mark, Pure Encapsulations sells products using additional brand names, or sub-brands, many of which are the subject of U.S. trademark registrations (the PURE ENCAPSULATIONS mark and the additional sub-brands are collectively hereinafter referred to as the Pure Encapsulations Marks and/or the Marks). 9. Pure Encapsulations is the owner of several U.S. Trademark Registrations for its
nutritional supplement products, including but not limited to PURE ENCAPSUALTIONS, INC. (Reg. No. 2,096,198), CRANBERRY NS (Reg. No. 2,375,292); A.C. FORMULA (Reg. No. 2,430,683); NUTRIENT 950 (Reg. No. 2,302,038); ULTRANUTRIENT (Reg. No. 2,302,037); and A.I. FORMULA (Reg. No. 2,396,919) (the Registered Marks). 10. Pure Encapsulations has also expended many thousands of dollars over the years
advertising and promoting its products under the Pure Encapsulations Marks in various media and on its website. 11. Pure Encapsulations has established considerable and valuable common law and
registered trademark rights and goodwill in and to the Pure Encapsulations Marks by virtue of its long use and registration of the Marks, its substantial promotional and marketing efforts, its expenditure of vast sums in advertising and promotional activities, the substantial sales of products offered under the Marks, and third-party acclaim and attention. 12. The PURE ENCAPSULATIONS name and trademark is well recognized by
consumers as a symbol of quality and trust throughout the nutritional supplement and personal care industries, and elsewhere. Pure Encapsulations has invested substantially in the development
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and use of the PURE ENCAPSULATIONS brand. The PURE ENCAPSULATIONS trademark is a valuable corporate asset. DEFENDANTS INFRINGEMENT OF THE PURE ENCAPSULATIONS MARK 13. Defendant owns and operates an on-line store where it sells a selection of natural
products, including nutritional supplements. Consumers, including consumers in Massachusetts, order products on-line from Defendants on-line store, which are shipped directly to them, including in Massachusetts. 14. Defendants internet website currently displays over 180 images of Pure
Encapsulations products, all of which prominently display the PURE ENCAPSULATIONS house mark, as well as one or more of the Pure Encapsulations Marks and/or Registered Marks. (See Figure 1.) 15. When the consumer accesses the Defendants on-line store and clicks on Pure
Encapsulations under Brand Names, the site displays images of Pure Encapsulations products, indicating that each one has been discontinued. (See Figure 1.)
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Figure 1 - iHerb.com website 16. When the consumer clicks on a Pure Encapsulations product image, the site
navigates to a page that again displays the product as discontinued and also states: You may also consider the following product(s), which lists products directly competitive to the Pure Encapsulations product. The page containing the Pure Encapsulations product, deceptively listed
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as discontinued, also states: Customers who bought this product, also bought any or all of the following products, which also lists products directly competitive to Pure Encapsulations products. (See Figure 2.)
Figure 2 - iHerb.com website 17. Defendants use of the Pure Encapsulations Marks creates a false, deceptive, and/or
misleading statement about the nature, characteristics, and qualities of Defendants business and/or its authorized products by suggesting that Defendant is affiliated or associated with Pure
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Encapsulations, and that Defendant is authorized to distribute products by Pure Encapsulations when it is not. 18. Defendants false, deceptive and misleading statements about the nature,
characteristics, and qualities of Pure Encapsulations products, including the statement that the products have been discontinued, are misstatements of fact. 19. On April 29, 2011 Pure Encapsulations notified Defendant, through a letter
addressed to Mr. Ray Faraee, of Defendants infringing activities. 20. Upon information and belief, Defendant was aware of Pure Encapsulations rights in
the Pure Encapsulations Marks at all relevant times. INJURY TO PURE ENCAPSULATIONS AND THE PUBLIC 21. Defendants actions described above have damaged and irreparably injured Pure
Encapsulations and, if permitted to continue, will further damage and irreparably injure Pure Encapsulations, the Pure Encapsulations Marks, and Pure Encapsulations reputation and good will associated with the Pure Encapsulations Marks. Defendants actions also substantially damage the publics interest in being free from confusion as to the source, sponsorship, or affiliation of Defendants products and services. 22. Defendants use of the Pure Encapsulations Marks is likely to cause confusion,
mistake, or deception as to the source or origin of Defendants products, and is likely to falsely suggest a sponsorship, connection, license, or association of Defendant and/or its products and services with Pure Encapsulations and/or its products.
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23.
Defendants false and/or misleading statements, individually and collectively,
irreparably injure the public and Pure Encapsulations by deceiving consumers into mistakenly believing that Defendants products or services have qualities and characteristics that they do not. 24. Defendants false and/or misleading statements, individually and collectively, are
material to customers purchasing decisions and are likely to divert customers away from considering or purchasing Pure Encapsulations products. 25. Defendants false and/or misleading statements, individually and collectively, have
caused, and if not enjoined, will continue to cause actual and irreparable harm to Pure Encapsulations. COUNT I Trademark Infringement Under Section 32(a) of the Lanham Act, 15 U.S.C. 1114(a) 26. Pure Encapsulations hereby repeats and realleges each and every allegation set forth
in paragraphs 1 through 25 of this Complaint. 27. Without Pure Encapsulations consent, Defendant used and continues to use in
commerce reproductions, copies, and/or colorable imitations of Pure Encapsulations Registered Marks in connection with the offering, sale, and advertising of products, which is likely to cause confusion, or to cause mistake, or to deceive, in violation of Section 32 of the Lanham Act, 15 U.S.C. 1114. 28. Upon information and belief, the actions of Defendant described above have at all
times relevant to this action been willful. 29. As a direct and proximate result of the actions of Defendant alleged above, Pure
Encapsulations has been damaged and will continue to be damaged.
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COUNT II Trademark Infringement, False Designation of Origin, and Unfair Competition Under Section 43(a)(1)(A) of the Lanham Act, 15 U.S.C. 1125(a)(1)(A) 30. Pure Encapsulations repeats and realleges each and every allegation set forth in
paragraphs 1 through 29 of this Complaint. 31. Defendants actions, as described above, are likely to cause confusion, mistake, or
deception as to the origin, sponsorship, or approval of Defendants products, services and commercial activities, and thus constitute trademark infringement, false designation of origin, and unfair competition with respect to the Pure Encapsulations Marks, in violation of Section 43(a)(1)(A) of the Lanham Act, 15 U.S.C. 1125(a)(1)(A). 32. Upon information and belief, the actions of Defendant described above have at all
Encapsulations has been damaged and will continue to be damaged. COUNT III False Advertising in Violation of Federal Law Under Section 43(a)(1)(B) of the Lanham Act, 15 U.S.C. 1125(a)(1)(B) 34. Pure Encapsulations repeats and realleges each and every allegation set forth in
paragraphs 1 through 33 of this Complaint. 35. Defendants actions, as described above, constitute false and misleading descriptions
and misrepresentations of fact in commerce which, in commercial advertising and promotion, misrepresent the nature, characteristics, and qualities of Defendants products, services, or commercial activities and/or Pure Encapsulations products, services, or commercial activities in violation of Section 43(a)(1)(B) of the Lanham Act, 15 U.S.C. 1125(a)(1)(B).
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Filed 08/16/11 Page 10 of 14
36.
Upon information and belief, the actions of Defendant described above have at all
Encapsulations has been damaged and will continue to be damaged. COUNT IV Unfair and Deceptive Acts and Practices under M.G.L. c. 93A, 11 38. Pure Encapsulations repeats and realleges each and every allegation set forth in
paragraphs 1 through 37 of this Complaint. 39. Pure Encapsulations and Defendant are engaged in the conduct of trade or
commerce within the meaning of M.G.L. c. 93A. 40. Through the unfair and deceptive acts and practices described herein, Pure
Encapsulations has been, and continues to be, damaged by Defendants activities and conduct. Defendant has profited thereby and, unless its conduct is enjoined, Pure Encapsulations will continue to suffer irreparable injury that cannot adequately be calculated or compensated by monetary damages. Accordingly, Pure Encapsulations seeks injunctive relief pursuant to M.G.L. c. 93A, 11. 41. Upon information and belief, the actions of Defendant described above have at all
times relevant to this action been willful and knowing violations of Pure Encapsulations rights. Accordingly, Pure Encapsulations is entitled to a judgment of three times its damages, together with reasonable attorneys fees, pursuant to M.G.L. c. 93A, 11.
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Filed 08/16/11 Page 11 of 14
COUNT V Common Law Trademark Infringement, Unfair Competition, and Misappropriation 42. Pure Encapsulations repeats and realleges each and every allegation set forth in
paragraphs 1 through 41 of this Complaint. 43. Defendants actions described above constitute common law trademark
infringement, unfair competition, and misappropriation of Pure Encapsulations good will under the common law of Massachusetts and other states. 44. Upon information and belief, the actions of Defendant described above have at all
Encapsulations has been damaged and will continue to be damaged. PRAYER FOR RELIEF WHEREFORE, Pure Encapsulations prays that this Court enter judgment in its favor on each and every claim for relief set forth above and award it relief including, but not limited to, the following: A. An Order declaring that Defendants use of the Pure Encapsulations Marks
constitutes unfair competition and unfair trade practices under federal and state law, as detailed above; B. An Order declaring that Defendants statements made on its website and
elsewhere, as detailed above, are false, misleading, and/or deceptive and misrepresent the nature, characteristics, and qualities of Pure Encapsulations and/or Defendants products, services, or commercial activities in violation of 15 U.S.C. 1125(a)(1)(B) and other applicable laws.
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Filed 08/16/11 Page 12 of 14
C.
An Order directing Defendant to immediately and permanently remove any and all
references to the Pure Encapsulations Marks from any internet website owned or controlled by Defendant. D. An injunction preliminarily and permanently enjoining Defendant and its
employees, officers, directors, principals, subsidiaries, related companies, and all persons in active concert or participation with any of them: 1. From using in any way the Pure Encapsulations Marks or any other
advertising or promotional materials bearing or displaying Pure Encapsulations or any designs, logos, or marks that are confusingly similar to the Pure Encapsulations Marks; 2. From representing by any means whatsoever, directly or indirectly,
that Defendant, any products or services offered by Defendant, or any activities undertaken by Defendant, are associated or connected in any way with Pure Encapsulations; 3. From making the false and/or misleading statements detailed above
and from otherwise mischaracterizing the nature, characteristics, and qualities of Pure Encapsulations and/or Defendants products, services, or commercial activities; and 4. From otherwise publishing, printing, or disseminating false,
misleading, or deceptive statements regarding Pure Encapsulations, Pure Encapsulations services or products, or Pure Encapsulations business activities, or Defendant, Defendants services or products, or Defendants business activities.
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Filed 08/16/11 Page 13 of 14
E.
An Order directing Defendant to immediately destroy or permanently alter all
television commercials, videos, signage, posters, displays, brochures, catalogs, newsletters, manuals, forms, stationery, websites, advertising and promotional materials and items, and any other materials and things that bear or display the Pure Encapsulations Marks, or any other designs, logos, or marks that are confusingly similar to the Pure Encapsulations Marks; F. An Order directing Defendant to file with this Court and serve on Pure
Encapsulations attorneys, thirty (30) days after the date of entry of any injunction, a report in writing and under oath setting forth in detail the manner and form in which it has complied with the injunction; G. An Order requiring Defendant to account for and pay to Pure Encapsulations any
and all profits arising from the foregoing acts of infringement, false designation of origin, false advertising, unfair competition, and misappropriation, and increasing such profits for payment to Pure Encapsulations in accordance with 15 U.S.C. 1117 and other applicable laws; H. An Order requiring Defendant to pay Pure Encapsulations compensatory damages
in an amount as yet undetermined caused by the foregoing acts of infringement, false designation of origin, false advertising, unfair competition, and misappropriation, and trebling such compensatory damages for payment to Pure Encapsulations in accordance with 15 U.S.C. 1117 and other applicable laws; I. An Order requiring Defendant to pay Pure Encapsulations compensatory damages
in an amount as yet undetermined caused by the foregoing acts of unfair competition and unfair trade practices under M.G.L. c. 93A, 11;
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Filed 08/16/11 Page 14 of 14
J.
An Order requiring Defendant to pay Pure Encapsulations punitive damages in an
amount as yet undetermined caused by the foregoing acts of Defendant under M.G.L. c. 93A, 11 and other applicable laws; K. An Order requiring Defendant to pay Pure Encapsulations costs and attorneys
fees in this action pursuant to 15 U.S.C. 1117, and other applicable laws, including M.G.L. c. 93A, 11; and L. Other relief as the Court may deem appropriate. DEMAND FOR JURY TRIAL Pursuant to Rule 38 of the Federal Rules of Civil Procedure, Pure Encapsulations demands trial by jury in this action of all issues triable by jury in this matter.
Respectfully submitted, PURE ENCAPSULATIONS, INC. By its attorneys,
Dated: August 16, 2011
/s/ Erica Tennyson Carrie Webb Olson, BBO# 677496 Erica Tennyson, BBO #660707 DAY PITNEY LLP One International Place Boston, MA 02110-3179 Phone (617) 345-4600 Fax: (617) 345-4745 colson@daypitney.com etennyson@daypitney.com
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Case 1:11-cv-11463-DPW Document 1

Filed 08/16/11 Page 1 of 14