Case 3:23-cv-00060-MPB-CSW Document 54 Filed 11/03/23 Page 1 of 36 PageID #: 799

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF INDIANA
EVANSVILLE DIVISION

HEALTHSMART FOODS, INC., ) CASE NO. 3:23-cv-00060-MPB-CSW

)
Plaintiff, )
)
v. )
)
BETH PORTER and )
SWEET NOTHINGS, INC., )
)
Defendants. )

DEFENDANTS’ OPPOSITION TO HEALTHSMART FOODS, INC.’S MOTION FOR

PRELIMINARY INJUNCTION1

I. INTRODUCTION

The Motion for Preliminary Injunction (“Motion”) filed by Plaintiff HealthSmart Foods,

LLC (“HealthSmart”) comes nowhere close to satisfying the stringent standard for injunctive

relief. Indeed, there are at least three reasons why the Court should deny the Motion even before

reaching the merits. And HealthSmart’s Motion fails on the merits as well.

HealthSmart’s Fraud on the PTO. Fraud in obtaining a trademark is not only a

complete defense to an infringement claim, it is also grounds to cancel the trademark altogether.

HealthSmart admittedly provided false information to the Patent Trademark Office (“PTO”) in

connection with its registration and renewal. HealthSmart signed declarations under penalty of

perjury in 2017 and 2022 stating that it was using in commerce all aspects of the trademark.

Based on that representation, HealthSmart obtained a trademark covering “candy; chocolate

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Defendants’ Motion to Dismiss [Dkt. 12] and Motion to Transfer [Dkt. 13] are pending, and
Defendants’ response herein is not a waiver of any jurisdictional or other arguments therein.

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confections; baked goods, namely, bakery squares, cupcakes, and cakes.” But HealthSmart

admits that it never sold “baked goods,” “bakery squares,” cupcakes,” or “cakes.” This

constitutes fraud on the PTO and grounds to deny the Motion. Indeed, HealthSmart has all but

admitted to fraud. Just days after their Vice President admitted under oath that these were

misrepresentations, HealthSmart “amended” its Motion to omit reference to “baked goods.”

HealthSmart’s Unreasonable Delay. Defendant Sweet Nothings, Inc. (“Sweet

Nothings”) began selling its Nut Butter Bites—the allegedly infringing product—in September

2021. HealthSmart, though, claims not to have discovered the alleged infringement until October

2022. Regardless of which date the Court uses, HealthSmart has delayed unreasonably. It did not

file this lawsuit until April 6, 2023. And it delayed until October 3, 2023, before filing this

Motion. Although HealthSmart’s claims that this Motion is “urgent,” it does not even attempt to

explain why it sat on its hands for almost one year (based its own version of the facts) or why

injunctive relief is “urgent” now. Courts routinely reject preliminary injunction motions as

untimely based on delays far less substantial than the one presented here.

HealthSmart’s Unclean Hands. HealthSmart’s packaging and marketing of its “Sweet

Nothings” candy (the “Candy”) are designed to defraud consumers. HealthSmart is violating

numerous FDA regulations, including: (1) make false statements concerning the serving size; (2)

making false comparisons to non-existent products; (3) falsely claiming its products are

“significantly reduced” in fat and saturated fat; and (4) selling its products in a manner designed

to convince consumers they are healthy. In fact, HealthSmart’s products contain ingredients

known to cause cardiovascular disease and colon cancer, that have been condemned by the

World Health Organization, and that have been shown to be genotoxic. Based on the foregoing,

HealthSmart cannot enforce its mark it all, let alone an injunction against “infringement” of it.

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HealthSmart’s Lack of Evidence of Consumer Confusion. All of Defendant Sweet

Nothings’ product lines are fruit-based, all-natural, certified organic, non-dairy, and free of

artificial flavors and added sugar. They are all made from organic whole fruit, organic nuts and

organic seeds. At issue in this case are Sweet Nothings’ Nut Butter Bites—two-bite-sized, highly

nutritious snacks. They are designed for highly discerning consumers. Nut Butter Bites come in

four flavors, only one of which contains cacao, the tropical fruit from which chocolate is made.

Grocery partners sell Nut Butter Bites in the nutrition bar aisle next to items like CLIF Bars.

HealthSmart sells a line of diet chocolate candies under its “Sweet Nothings” brand, one

of many diet product lines it offers. Its “Sweet Nothings” logo incudes a representation that the

Candy is “Reduced Calorie, Reduced Fat.” HealthSmart currently offers six flavors of its Candy,

all of which contain Epogee. Epogee is a synthetic “fat replacement”—a non-digestible

ingredient designed to mimic the flavor of fat without the calories. All of HealthSmart’s Candy

contains synthetic sugars, like sucralose, as well as added sugar. None of HealthSmart’s Candies

contain fruit or seeds. None contain organic ingredients. None are all-natural or plant-based.

The issue in a trademark infringement action is whether there is a likelihood of confusion

as to “the source” of the goods at issue. In other words, are consumers likely to believe that Nut

Butter Bites are made by HealthSmart? HealthSmart fails to address this point in its Motion. And

there is no reason any consumer would believe Nut Butter Bites are sold by HealthSmart.

HealthSmart even admits that no consumers have been confused.

Defendant Sweet Nothings has undertaken every effort to distinguish itself from

companies like HealthSmart. The two companies use branding that is divergent in virtually every

conceivable respect, including photographs, color scheme, logo, and font. HealthSmart’s

President and owner admits that, other than name, there is no basis to confuse the products.

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Nor is there material overlap with respect to sales channels. Nut Butter Bites have been

sold for over two years. They are not sold in any of the same brick-and-mortar stores as

HealthSmart’s Candy. Defendant Sweet Nothings sells its Nut Butter Bites in natural foods

stores that would not carry HealthSmart’s Candy due to the artificial and toxic ingredients. The

only place that offers both sets of products is Amazon. Amazon, though, comprises just 9% of

Defendant Sweet Nothings’ sales of Nut Butter Bites. (HealthSmart has refused to disclose its

Amazon sales in discovery.) And, on Amazon, there is a disclosure that the “manufacturer” of

the Candy is “HealthSmart Foods,” eliminating any possibility of confusion.

HealthSmart has no evidence of actual confusion. HealthSmart admits there is no

indication that even a single customer has been confused. In the more than two years since both

product lines have been offered, not a single customer has posted an online review indicating any

confusion (there are hundreds of combined reviews). Not a single customer has complained to

Defendant Sweet Nothings—or even asked a single question—about HealthSmart. Two years is

more than enough time to determine whether customers are being confused. They are not.

Moreover, HealthSmart’s evidence on this Motion is even in the record. HealthSmart did

not file some of its evidence; it failed to properly authenticate any of it; and it has refused to

produce the most fundamental documents underlying its case (which were requested months

ago). The Court cannot grant a preliminary injunction motion under these circumstances.

II. STATEMENT OF FACTS

A. Defendant Sweet Nothings’ Nut Butter Bites

Porter founded a company called “Sweet Nothings” in 2017, which focuses on all-natural

snack options. (Porter Decl., ¶ 2.) Defendant Sweet Nothings offers a line of Nut Butter Bites in

the following flavors: Apple Cinnamon, Oatmeal Raisin, Strawberry Pear Peanut Butter, and

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Chocolate Peanut Butter. Defendant Sweet Nothings previously sold Chocolate Banana bites, but

that product line has been discontinued. (Id.) Of the four flavors, only the Chocolate Peanut

Butter flavor contains cacao, the fruit-based raw ingredient used to make chocolate. (Id.)

All of the Nut Butter Bites are all-natural, plant-based, vegan, certified organic, and

contain no preservatives, artificial flavors or chemicals, or added sugar. (Porter Decl., ¶3.) Porter

founded Sweet Nothings because her children were eating store-bought snacks that contained

harmful chemicals and had little or no nutritional value. Porter has now devoted her life to

ensuring access to snacks made from real foods, like nutrient-dense fruits and vegetables. (Id.)

Defendant Sweet Nothings sells its products in retail stores that have very stringent

quality standards for the products available, like Whole Foods, Thrive Market, and Sprouts.

(Porter Decl., ¶ 4.) Defendant Sweet Nothings also sells its products on Amazon. (Id., ¶ 7.) Less

than 10 percent of its Nut Butter Bites sales come from Amazon. (Id.)

The packaging of Nut Butter Bites includes bright colors, like orchid, periwinkle blue,

and pink, and uses a small six-point font for the “Sweet Nothings” mark. (Porter Decl.,¶ 12.) The

company logo includes a heart-shaped apple with a leaf growing from the stem, designed to

signify the products as all-natural, real foods. (Id.) The following images appear on Amazon:

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On all Sweet Nothings’ Amazon pages for Nut Butter Bites, there is a photograph of

Porter with her two children. (Porter Decl., ¶¶ 10, 14-15.) Under the photograph is the story

behind Porter’s decision to found the company, including its focus on healthy, all-natural

ingredients. (Id.) On Amazon, Nut Butter Bites have a special designation for products that are

certified organic and that are “Climate Pledge Friendly.” (Id., ¶ 16.) Nut Butter Bites have never

been advertised as a low-fat, reduced calorie, or diet products. (Id.)

B. HealthSmart’s “Sweet Nothings” Line of Candies

HealthSmart markets itself as a diet chocolate candy brand. (Dkt. 51, ¶¶ 22, 35.) In 2017,

it registered a trademark for “Sweet Nothings” that covered: “candy, chocolate confections,

baked goods, including bakery squares, cupcakes and cakes.” (Id. ¶ 23.) HealthSmart sells its

products on Amazon and its website healthsmartfoods.com, as well as in “mom and pop” grocery

stores. (Id. ¶ 2; Procel Decl., Exh. A at 98:7-14.)

HealthSmart’s Candy uses synthetic ingredients, including polydextrose, which is a non-

digestible additive made in a laboratory. (Procel Decl., ¶¶ 4-5, Exhs. B-C.) It is used as a bulking

agent and thickener. (Id., ¶ 6 & Exh. D.) The Candy contains esterified propoxylated glycerol

(Epogee), which is a synthetic fat made in a laboratory. (Id., ¶ 7 & Exh. E.) It was invented in the

1980s by a subsidiary of one of the largest oil companies in the United States. It is not digestible

by the human body. (Id.) HealthSmart’s Candy contains soy lecithin, an additive that is extracted

from soy using hexane. Hexane is a solvent used in making glue and gasoline. The soy is

typically genetically modified. (Id., ¶ 8 & Exh. F.) HealthSmart’s Candy contains carrageenan, a

thickening agent. Carrageenan is associated with inflammation, digestive problems, and an

increased risk of colon cancer. In 2016, the National Organic Standards Board voted to remove

carrageenan from their approved list. (Id., ¶ 9 & Exh. G.) No food containing carrageenan can be

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labeled “USDA organic” due to the health risks. (Id.) And HealthSmart’s contains sucralose, a

non-sugar sweetener (“NSS”). The WHO recently issued a warning confirming what the

nutritional and diet industries have known for years:

[T]he use of NSS does not confer any long-term benefit in reducing body fat in
adults or children. Results of the review also suggest that there may be potential
undesirable effects from long-term use of NSS, such as an increased risk of type
2 diabetes, cardiovascular diseases, and mortality in adults.

(Id., ¶ 10 & Exh. H.) The WHO further states: “Replacing free sugars with NSS does not help

with weight control in the long term.” Instead, it may cause terminal illnesses like diabetes and

cardiovascular disease. (Id.)

HealthSmart’s Candy is offered on Amazon in the candy department. (Id., ¶ 10 & Exh. I;

Porter Decl., ¶ 11) All of its Candy contains added sugars (in addition to artificial sweeteners)

and dairy. (Procel Decl., Exh. A at 131:13-22, 133:10-15.) None of its Candy is organic. (Id. at

131:23-132:4.) HealthSmart’s packaging of its candy uses dark colors and a stylized cursive

script designed to suggest an indulgent dessert.

The following is the ingredient lists for Defendant Sweet Nothings’ Chocolate Peanut Butter

flavor of Nut Butter Bites and HealthSmart’s Caramel Pecan Clusters Sweet Nothings Candy:

Defendant’s Nut Butter Bites HealthSmart’s Sweet Nothings

Chocolate Peanut Butter Caramel Pecan Clusters
Organic dates, organic peanuts, organic oats, Caramel Layer (Prebiotic Soluble Fiber,
organic cacao, organic flaxseed, sea salt. Polydextrose, Vegetable Oil (Palm Kernel,

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Palm Oil), Water, Glycerine, Milk Protein

Concentrate, Nonfat Dry Milk, Salted Butter
(Cream, Salt). Contains Less Than 2% of
Each of the Following: Soy Lecithin, Salt,
Disodium Phosphate, Carrageenan, Sucralose,
Vanillin) Chocolate Coating (Sugar,
Esterified Propoxylated Glycerol, RSPO Palm
Kernel Oil, Whole Milk Powder, Reduced
Mineral Whey Powder, Cocoa processed with
alkali, Cocoa Powder, Soy Lecithin (an
emulsifier), Salt and Vanillin, Pecans.

Procel Decl., Exh. D; Porter Decl., ¶ 17.)

C. HealthSmart's Fraudulent Trademark Application

On April 25, 2017, HealthSmart applied for a trademark covering the following: “candy;

chocolate confections; baked goods, namely, bakery squares, cupcakes, and cakes.” (Procel

Decl., ¶ 12 & Exh. J). In support of that application, HealthSmart filed a declaration under

penalty of perjury pursuant to 15 U.S.C. § 1051(a) indicating that the goods set forth in the

application were all being used in commerce. (Id.)

On October 10, 2022, HealthSmart filed a Section 8 Declaration of Use for the purpose of

renewing its trademark application. In support of that renewal, HealthSmart again filed a

declaration under penalty of perjury stating that it was using all aspects of its registered

trademark in commerce, including “baked goods, including bakery squares, cupcakes, and

cakes.” (Procel Decl., ¶ 13 & Exh. K.) Both the 2017 application and the 2022 renewal

acknowledge that “willful false statements and the like are punishable by fine or imprisonment,

or both, under 18 U.S.C. § 1001, and that such willful false statements and the like may

jeopardize the validity of this submission and the registration . . .” (Procel Decl., Exhs. K-L.)

In fact, HealthSmart has never sold bakery squares, cupcakes, or cakes, or any baked

goods of any kind. In discovery in this case, in response to Sweet Nothings’ requests to identify

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all documents reflecting HealthSmart’s sales of “baked goods, including bakery squares,

cupcakes, and cakes,” HealthSmart responded with one word: “none.” (Procel Decl., Exh. S,

Response No. 7.) So, too, HealthSmart’s founder and President flatly admitted at deposition that

the company never sold baked goods:

Q. At any point in time did HealthSmart sell actual baked products?

A. No.

(Procel Decl., Exh. A at 38:14-15.) And its Vice President, who submitted those false

declarations, admitted at deposition that they were false. (Procel Decl., ¶ 2.)

Notably, just three business days after the deposition of HealthSmart’s VP (and two days

before this Opposition was due), HealthSmart “amended” its trademark registration and

preliminary injunction motion to omit reference to “baked goods.” (Dkt. 48.) HealthSmart stood

by its false representations to the PTO (and this Court) for years—until it got caught red-handed.

D. Defendant Sweet Nothings’ Trademark Application

On November 15, 2018, Porter applied for a trademark with the PTO. (Dkt. 1-3.) The

PTO analyzed the likelihood of confusion merely “based on the description of the goods and/or

services stated in the application and registration at issue, not on extrinsic evidence of actual

use.” (Dkt. 1-4 at p.52.) In doing so, the PTO concluded that Sweet Nothings’ proposed

description of its frozen smoothies could theoretically overlap with the HealthSmart’s registered

trademark. (Id.) The PTO stated that “because applicant’s goods are identified broadly, they are

presumed to encompasses all goods of the type described, including registrant’s more narrow

goods.” (Id.) In particular, the PTO was concerned about the overlap involving “baked goods.”

The PTO expressly found that “frozen sections of health food stores contain baked goods.” (Dkt.

1-7 at p. 79.) Based on the overlapping descriptions, the PTO concluded that “applicant’s and

registrant’s goods are legally identical.” (Dkt. 1-4 at p.52.)

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Porter then narrowed her description of the goods in the trademark application to exclude

the precise language found in HealthSmart’s trademark:

Whole fruit-based, frozen, non-dairy, no added sugar, superfood-rich snack foods

in the nature of prepared snacks consisting primarily of fruit, and also containing
nuts, seeds or both nuts and seeds; none of the foregoing comprising or including
candy, chocolate confections, bakery squares, cupcakes, or cakes.

(Dkt. 1-5 at 59; Porter Decl., ¶ 18.) Porter also corrected the application to reflect that the goods

would be sold under International Class 29 (fruit and vegetable-based foods). (Id., ¶ 19.) Based

on the modifications, the PTO approved the registration on July 28, 2019. (Id., ¶ 20 & Exh. C.)

Porter assigned the trademark to Sweet Nothings, effective January 18, 2019. (Id.; Dkt. 1-10.)

III. LEGAL STANDARD

“A preliminary injunction is a very serious remedy, never to be indulged in except in a

case clearly demanding it.” Barbeque Marx, Inc. v. 551 Ogden, Inc., 235 F.3d 1041, 1044 (7th

Cir. 2000). “An applicant for preliminary relief bears a significant burden.” Illinois Republican

Party v. Pritzker, 973 F.3d 760, 762 (7th Cir. 2020) (affirming denial of preliminary injunction).

“A plaintiff seeking a preliminary injunction must establish that he is likely to succeed on the

merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the

balance of equities tips in his favor, and that an injunction is in the public interest.” Id.

The central issue in a trademark infringement action is whether there is a “likelihood of

confusion” as to the source of the goods at issue. Sorensen v. WD-40 Co., 792 F.3d 712, 726 (7th

Cir. 2015). “Possible confusion is not enough; rather, confusion must be ‘probable.’” Id.

IV. ARGUMENT

A. HealthSmart Cannot Enforce A Trademark Fraudulently Obtained

HealthSmart asserts that it has an incontestable trademark. (Dkt. 36 at 13.) However,

“incontestable marks are not invincible.” Jay Franco & Sons, Inc. v. Franek, 615 F.3d 855, 857

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(7th Cir. 2010) (granting summary judgment and holding that defense under 15 U.S.C. §1115(b)

applied as a matter of law); Georgia-Pac. Consumer Prod. LP v. Kimberly-Clark Corp., 647

F.3d 723, 727 (7th Cir. 2011) (“[I]ncontestable is not invincible; the Lanham Act lists a number

of affirmative defenses an alleged infringer can use . . .”).

Even an incontestable mark may be cancelled if the registration or renewal was obtained

fraudulently. 15 U.S.C. § 1064(3); Torres v. Cantine Torresella S.r.l., 808 F.2d 46, 1 USPQ2d

1483 (Fed. Cir. 1986) (holding that cancellation of trademark for fraud applies to both renewal

and registration). In addition, it is a complete defense to a trademark infringement action if the

trademark “was obtained fraudulently.” 15 U.S.C. § 1115(b)(1).

1. HealthSmart’s Trademark Registration and Renewal Contained

Material Misstatements Regarding Its Use of the Mark

As discussed above, both in its 2017 trademark application and in its 2022 renewal,

HealthSmart filed a declaration under penalty of perjury pursuant to 15 U.S.C. § 1051(a)

indicating that the goods set forth in the application were all being used in commerce—including

“baked goods, namely, bakery squares, cupcakes, and cakes.” (Procel Decl., Exhs. J-K.) In fact,

HealthSmart admits it has never sold bakery squares, cupcakes, or cakes, or any baked goods.

(See Procel Decl., Exh. S at Response No. 7; Exh. A at 38:14-15.)

The PTO registered the trademark at issue in this case based on a misrepresentation by

HealthSmart. This constitutes fraud. Orient Exp. Trading Co. v. Federated Dep't Stores, Inc.,

842 F.2d 650, 653 (2d Cir. 1988) (affirming cancellation of incontestable trademark on ground

that plaintiff ’s claimed first use in trademark application had been “greatly exaggerated” and

claimed continuous use was “sporadic at best.”); Herbaceuticals, Inc. v. Xel Herbaceuticals, Inc.,

86 USPQ2d 1572 (TTAB 2008) (granting summary judgment and holding that registration was

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cancelled on ground that plaintiff was not using mark as to every category of the goods identified

in its application—"if fraud can be shown in the procurement of a registration, the registration is

void in the international class or classes in which fraud based on nonuse has been committed);

Grand Canyon West Ranch, LLC v. Hualapai Tribe, 88 USPQ2d 1501 (TTAB 2008) (finding

fraud and refusing registration in its entirety where applicant falsely indicated that certain

services were used in commerce); Medinol Ltd. v. Neuro Vasx, Inc., 67 U.S.P.Q.2d 1205

(T.T.A.B. 2003) (“If fraud can be shown in the procurement of a registration, the entire resulting

registration is void.”). HealthSmart’s “amendment” this week in no way cures its fraud.

HealthSmart’s misrepresentation was material. The PTO issued a trademark based on the

false representation that HealthSmart was selling “baked goods” when it was not. There is

arguably no statement that could be more material. This is the very reason applicants are required

to provide a declaration of use under penalty of perjury. In fact, it is virtually the only thing an

application needs to certify to the PTO other than its address and phone number. And this

misrepresentation prejudiced Defendants. In denying Defendants’ original trademark application,

the PTO focused on the overlap regarding “baked goods.” (Dkt. 1-4 at p.52.) HealthSmart is now

suggesting that the PTO’s initial denial—based on HealthSmart’s fraudulent conduct—should

weigh against Defendants in this case (i.e., HealthSmart is attempting to profit from its own

fraud). This issue is dispositive, and the Court should deny the Motion on this basis alone.

2. HealthSmart Knew of the Falsity of Its Statements to the PTO

A defendant seeking to cancel a trademark need not show the plaintiff actually knew it

was misrepresenting information to the PTO. Rather, the defendant need only show the plaintiff

“knew or should have known” that it supplied false information to the PTO. See Torres v.

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Cantine Torresella S.r.l., 808 F.2d 46, 49 (Fed. Cir. 1986) (granting summary judgment

cancelling trademark). But here, HealthSmart actually knew of its own fraud.

HealthSmart admits it has never sold baked goods. (Procel Decl., Exh. A at 38:14-15.)

HealthSmart’s VP admits he knew it wasn’t selling baked goods when he declared under penalty

of perjury to the PTO that it did. (Id., ¶ 2.) This is a straightforward case for cancellation. See

Torres, 808 F.2d at 49 (cancelling mark where holder “submitted an affidavit stating the mark

was in use on wine, vermouth, and champagne when he knew it was in use only on wine.”).

HealthSmart only stops lying when it gets caught by Defendants. After Defendants called

out HealthSmart on December 8, 2022 for falsely claiming to the PTO that it was using its mark

for baked goods (Procel Decl., Exh. L.), HealthSmart suddenly filed a Section 15 Declaration of

Incontestability with the PTO on January 27, 2023 stating that it was not seeking incontestability

as to “baked goods, namely bakery squares, cupcakes and cakes.” (Id., Exh. M.) Yet that didn’t

stop HealthSmart falsely representing to this Court that it had valid trademark for baked goods,

when filing its Complaint in this case on April 6, 2023 (Dkt 1, ¶ 23), or when it filed its original

preliminary injunction motion on October 3, 2023 (Dkt. 36, at 1). Only after HealthSmart’s VP

admitted in deposition on October 27, 2023 that he knew his declarations to the PTO were false

when they were made did HealthSmart suddenly “amend” its trademark application, its

Complaint, and this Motion. (Dkt. 48; Dkt. 51 ¶ 24.) HealthSmart’s intent to defraud is manifest.

B. HealthSmart’s Motion Is Barred By Unclean Hands

1. The Unclean Hands Doctrine Bars Relief for a Trademark Plaintiff

That Has Engaged in False Advertising or Consumer Fraud

“Unclean hands is a traditional defense to an action for equitable relief. The purpose is to

discourage unlawful activity, and is as relevant to preliminary as to final relief.” Original Great

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Am. Chocolate Chip Cookie Co. v. River Valley Cookies, Ltd., 970 F.2d 273, 281 (7th Cir. 1992).

The unclean hand doctrine applies to Lanham Act claims. Id. (reversing district court order

granting preliminary injunction on ground that unclean hands doctrine barred claim for

trademark infringement). “[E]quity requires that those seeking its protection shall have acted

fairly and without fraud or deceit as to the controversy in issue . . .”). Id. The unclean hands

doctrine is designed to “prevent a wrongdoer from enjoying the fruits of his transgression, and

the Court adds in some cases also to avert injury to the public.” Packers Trading Co. v.

Commodity Futures Trading Comm'n, 972 F.2d 144, 149 (7th Cir. 1992) (quotations omitted).
The unclean hands doctrine has been applied specifically to trademark infringement

actions where the plaintiff misrepresented information to the public. Stokely-Van Camp, Inc. v.

Coca-Cola Co., 646 F. Supp. 2d 510, 533 (S.D.N.Y. 2009) (unclean hands doctrine barred

plaintiff from obtaining preliminary injunction in trademark infringement action where plaintiff

had engaged in false advertising); Procter & Gamble Co. v. Ultreo, Inc., 574 F.Supp.2d 339,

354–56 (S.D.N.Y.2008) (same). And it has been applied where the plaintiff has violated FDA

regulations or a consumer protection statute. See Strey v. Devine's, Inc., 217 F.2d 187, 190 (7th

Cir. 1954) (affirming denial of trademark infringement claim under unclean hands doctrine

where plaintiff was found to have misrepresented ingredients on packaging in violation of FDA

regulations); POM Wonderful LLC v. Coca Cola Co., 166 F. Supp. 3d 1085, 1099 (C.D. Cal.

2016) (holding, on trademark infringement claim, that “[w]ell-accepted general principles of

equity support [the] contention that a statutory violation gives a party unclean hands.”).

Unclean hands applies even where a mark is “incontestable.” 15 U.S.C. § 1115(b)(9);

Hodgdon Powder Co. v. Alliant Techsystems, Inc., 497 F. Supp. 2d 1221, 1236 (D. Kan. 2007)

(“Because the affirmative defenses of unclean hands and estoppel, are equitable in nature, they

are not barred by 15 U.S.C. § 1115(b)”); Phi Delta Theta Fraternity v. J. A. Buchroeder & Co.,

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251 F. Supp. 968, 977 (W.D. Mo. 1966) (same). Courts tend to apply the unclean hands doctrine

broadly when the interests of the public are implicated. See e.g., Packers Trading Co. v.

Commodity Futures Trading Comm'n, 972 F. 2d 144, 150 (7th Cir. 1992). “It is well established

a court of equity may deny relief for infringement of a trademark where plaintiff misrepresents

the nature of his product.” Strey v. Devine's, Inc., 217 F.2d 187, 190 (7th Cir. 1954).

2. HealthSmart Is Violating Numerous FDA Regulations

a. False Serving Size

The FDA regulates the labeling of food, including candy. Food is “misbranded” if “its

labeling is false or misleading in any particular.” 21 U.S.C. § 403(a). The FDA sets out detailed

requirements for the serving sizes that must be used on the labels of different categories of food.

21 CFR § 101.12(b). These were calculated to “reflect the amount of food customarily consumed

per eating occasion.” 21 CFR § 101.12(a)(1). In mandating these serving sizes, the FDA “sought

to ensure that foods that have similar dietary usage, product characteristics, and customarily

consumed amounts have a uniform reference amount.” 21 CFR § 101.12(a)(9).

The FDA requires the serving size for “all other candies” (i.e., candies not marketed as

and falling within one of five specified categories of candies, including “Baking candies (e.g.,

chips)” or “Hard candies, roll-type, mini-size in dispenser packages”) to be at least 30 grams. 21

CFR § 101.12(b), Table 2. HealthSmart’s Candy falls into this “all other candies” category.

HealthSmart’s Candy is individually wrapped (Procel Decl., Exh. A at 160:24-161:5), so the

correct serving size is the nearest whole unit greater than 30 grams (i.e., three individually

wrapped candies weighing 12 grams each, thus totaling 36 grams).

Until recently, HealthSmart’s Candy purportedly has had a serving size of 12 grams, not

36 grams as required. (Procel Decl., ¶ 16 & Exh. N.) Based on these inaccurate serving sizes,

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HealthSmart claimed that its products have reduced fat, calories and sugar. (Procel Decl., Exh.

P.) HealthSmart deliberately manipulated the serving size on its products to give the false

impression that they have less fat, less sugar, and fewer calories per serving than they do.

HealthSmart is also manipulated the serving size to deceive consumers into believing they will

eat far less of the Candy in one serving than is actually the case. HealthSmart recently changed

the serving size on its nutrition labels to reflect that the serving size is 2.5 pieces of candy (30

grams), not one piece. (Procel Decl., ¶ 17 & Exh. O.) Even though this is still not the appropriate

serving size under FDA regulations (it should be 3 pieces and 36 grams), this is (as with

HealthSmart’s about-face with the PTO) a tacit admission that HealthSmart had been misleading

consumers all along about the amount of Candy they were likely to eat.

b. False Comparative Claims

HealthSmart’s comparative claims violate FDA regulations. For instance, HealthSmart

claims that the calorie count for its Candy is “1/2 that of typical candy.” HealthSmart claims that

it uses a synthetic fat, Epogee, that “reduces fat and saturated fat by roughly 67%.” And

HealthSmart’s packaging sets forth comparative claims like:

• “Chocolate calories reduced by 36-37%.”

• Chocolate saturated fat reduced by 63-66%.”
• Chocolate fat reduced by 60-63%.”

(Procel Decl., Exh. P.)

HealthSmart is required by the FDA to identify in its marketing and advertising the

“reference food” that is being compared. 21 C.F.R. 101.13(j)(1)(B)(2). HealthSmart does not

identify any “reference food.” “Typical candy” is not a “reference food” under the regulations.

Id. And the representations about the reduction in "chocolate calories” and “chocolate fat” have

no reference whatsoever. All of the foregoing representations violate FDA regulations.

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Also, when the correct serving size is used, it becomes clear that HealthSmart's Candy is

not "significantly reduced" in fat and saturated fat relative to comparable candy. For instance,

HealthSmart's Caramel Pecan Clusters would have 5.5 grams of fat and 3.5 grams of saturated

fat per 36 gram serving (if HealthSmart calculated it based on the correct serving size). (Porter

Decl., Exh. E.) Milky Way Minis have 6 grams of fat and 4 grams of saturated fat per 34 grams.

(Procel Decl., Exh. Q.) The fat and saturated fat in HealthSmart’s Candy is virtually identical to

comparable candy bars. HealthSmart's “reduced fat” claims are blatant misrepresentations.

c. False Calorie Count

The FDA regulates the calculation of calories pursuant to 21 C.F.R. 101.9. The

nutritional label on HealthSmart’s Candy contains a wildly inaccurate and false calorie count.

For instance, the packaging for HealthSmart’s Caramel Crispy flavor of its Candy reflects 80

calories per 30-gram serving. (Procel Decl., Exh. O.) It is not possible for that product to have

only 80 calories using the calculation mandated under the law (9 calories/g fat, 4 calories/g

carbohydrates and protein). With 3.5 grams of fat, 16 grams of carbohydrates and 2 grams of

protein, the actual number of calories is at least 100, not 80 as HealthSmart claims.

3. HealthSmart is Making Numerous False Health Claims

HealthSmart’s Candy is sold on the HealthSmartfoods.com website. These webpages

prominently feature the name “HealthSmart.”

Any reasonable consumer would interpret these terms as indicating that HealthSmart’s

products, including its Candy, support a healthy lifestyle. See Johnson-Jack v. Health-Ade LLC,

587 F. Supp. 3d 957, 969 (N.D. Cal. 2022) (plaintiff stated claim for unfair business practices

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and false advertising where brand name “Health-Ade” misrepresented that product was healthy,

even though it contained unhealthy amount of sugar). This interpretation is further supported by

HealthSmart’s use of the slogan “A Better Way to Live” and its claim that its products are “great

for all diets including Weight Watchers, South Beach and Atkins!”2 (Dkt. 1 at 11 ¶ 33.)

HealthSmart’s Candy is not healthy. It does not support “A Better Way to Live.” It is not

“great for all diets.” It is not great for any diet. It is loaded with artificial and synthetic

ingredients, some of which are not digestible by the human body. It contains ingredients that are

associated with digestive problems, colon cancer, diabetes, and cardiovascular disease. And it

contains synthetic sugars that are not even effective with respect to weight loss.

HealthSmart is not entitled to an injunction to protect its trademark when it has been

abusing its trademark and utilizing it to perpetrate a fraud on consumers.

C. HealthSmart’s Motion Is Barred By the Doctrine of Laches

“Preliminary injunctions are routinely denied in trademark cases if there is laches—an

undue delay of even weeks or months in seeking such relief once the plaintiff has or should have

knowledge of the wrong.” Borden, Inc. v. Kraft, Inc., 1984 WL 1458, at *16 (N.D. Ill. 1984)

(citations omitted). In Borden, the plaintiff delayed five months after learning about the alleged

trademark infringement before seeking injunctive relief. Id. During that time, the defendant

continued to broadcast the allegedly infringing television commercials. Id. The District Court

held that “such delay speaks volumes about whether a plaintiff is being irreparably injured.” Id.

2
The term “including” is expansive rather than restrictive. See, e.g., Federal Election Com'n v. Mass.
Citizens for Life, Inc., Krepps v. NIIT (USA), Inc., 2014 WL 273780, at * 7 (N.D. Ill. Jan. 24, 2014).
Accordingly, HealthSmart claims that its Candy is “great of all diets” without limitation. This, read in
conjunction with HealthSmart’s other claims, indicates that its product line is supposed to be healthy.

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(“Borden's delay clearly indicates that Borden was not being injured at all during Kraft's rapidly

increasing commercial broadcasts.”) (denying preliminary injunction based on laches).3

HealthSmart offers no explanation as to why it did not seek an injunction when

Defendant Sweet Nothings began selling Nut Butter Bites in September 2021. Nor does

HealthSmart explain its failure to seek an injunction when it claims it learned about Nut Butter

Bites in or around October 2022. (Dkt. 1-12.) And Defendants have been prejudiced by this

unjustified delay. In the year between the time HealthSmart claims it learned about the alleged

infringement and when it filed its motion for preliminary injunction in October 2023, Sweet

Nothings has spent an estimated $370,400 on research, development, advertising, and marketing

of its allegedly infringing Nut Butter Bites. (Porter Decl. ¶ 21.) These are precisely the

circumstances in which laches applies to bar the relief requested by the plaintiff.

D. HealthSmart Is Not Entitled to a Preliminary Injunction on the Merits

1. HealthSmart Has Not Shown Irreparable Harm

a. HealthSmart Is Not Entitled to A Presumption of Harm

HealthSmart states that it “urgently requests this Court to immediately enjoin Defendants

from distributing, marketing . . .” (Dkt. 36 at 2.) HealthSmart then correctly argues that a party

moving for injunctive relief in a trademark infringement action is entitled to a rebuttable

presumption of irreparable harm “upon a finding of likelihood of success on the merits.” (Motion

at 6 (quoting 15 U.S.C.A. § 1116(a).) But as discussed below, because HealthSmart comes

nowhere near establishing a likelihood of success on the merits, there is no basis to apply a

presumption of irreparable harm here.

3
Although the case cited a prior version of the Lanham Act, the application of laches has not changed.

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b. HealthSmart’s Delay In Bringing This Motion Precludes a

Finding of Irreparable Harm

“Preliminary injunctions are generally granted under the theory that there is an urgent

need for speedy action to protect the plaintiffs' rights.” Citibank, N.A. v. Citytrust, 756 F. 2d 273,

276 (2d Cir. 1985). “While irreparable harm is generally presumed in the usual trademark

infringement case, that presumption is overcome where the plaintiff delays in seeking injunctive

relief.” Ohio Art Co. v. Lewis Galoob Toys, Inc., 799 F. Supp. 870, 887 (N.D. Ill. 1992);

Ixmation, Inc. v. Switch Bulb Co., Inc., 2014 WL 5420273, at *8 (N.D. Ill. Oct. 23, 2014) (delay

precluded preliminary injunction in trademark infringement action where plaintiff waited 4.5

months to seek injunctive relief after filing arbitration); see Johnson Publg, Co., Inc. v. Willitts

Designs Int'l, Inc., 1998 WL 341618 (N.D.Ill.1998) (no irreparable harm where plaintiff waited

four months to file motion for preliminary injunction); Stokley–Van Camp, Inc. v. Coca–Cola

Co., 1987 WL 6300 (N.D.Ill.1987) (“extraordinary remedy” of preliminary injunction denied

where plaintiff chose to wait three months before filing trademark infringement action).4

Sweet Nothings began selling Nut Butter Bites in September 2021. (Porter Decl., ¶ 30.)

HealthSmart first claimed Defendants infringed on its trademark on November 11, 2022. (Dkt. 1-

4
Numerous trademark injunction cases are in accord. See Markowitz Jewelry Co. v. Chapal/Zenray, Inc.,
988 F. Supp. 404, 406–07 (S.D.N.Y. 1997) (two months delay constituted lack of irreparable harm);
Tough Traveler, Ltd. v. Outbound Prod., 60 F.3d 964, 968 (2d Cir. 1995) (reversing district court order;
“any such presumption of irreparable harm is inoperative if the plaintiff has delayed either in bringing suit
or in moving for preliminary injunctive relief.”); Century Time Ltd. v. Interchron Ltd., 729 F. Supp. 366
(S.D.N.Y.1990) (six month delay defeated rebuttable presumption of irreparable harm); Comic Strip, Inc.
v. Fox Television Stations, Inc., 710 F.Supp. 976 (S.D.N.Y.1989) (seven months was too long); Nina
Ricci, S.A.R.L. v. Gemcraft Ltd., 612 F.Supp. 1520 (S.D.N.Y.1985) (four months); MB Fin. Bank, N.A. v.
MB Real Estate Servs., 2003 WL 22765022, at *8 (N.D. Ill. Nov. 21, 2003) (eight months); Citibank,
N.A. v. Citytrust, 756 F. 2d 273, 276 (2d Cir. 1985) (10-weeks); Krueger Int'l, Inc. v. Nightingale Inc.,
915 F. Supp. 595, 613 (S.D.N.Y. 1996) (“I decline to manufacture a sense of urgency that is not
supported by plaintiff's own conduct.”); Playboy Enterps., Inc. v. Netscape Commc'ns Corp., 55 F. Supp.
2d 1070, 1090 (C.D. Cal. 1999), aff'd, 202 F.3d 278 (9th Cir. 1999) (five-months); MB Fin. Bank, N.A. v.
MB Real Est. Servs., L.L.C., No. 02 C 5925, 2003 WL 22765022, at *8 (N.D. Ill. Nov. 21, 2003) ( “These
delays are inconsistent with Bank's assertions that it faces irreparable harm.”).

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12.) It then delayed until April 6, 2023, before filing this lawsuit. (Dkt. 1.) And HealthSmart

delayed again until October 3, 2023, before filing this Motion. (Dkt. 36.)

The Motion did not address HealthSmart’s 12-month delay after discovering the

infringement in October 2022. Nor has it attempted to explain why injunctive relief now is

“urgent.” (Dkt. 36 at 2.) HealthSmart cannot obtain injunctive relief by simply sweeping its

unreasonable delay under the rug. See Hubbard Feeds, Inc. v. Animal Feed Supplement, Inc., 182

F.3d 598, 602 (8th Cir. 1999) (affirming denial of preliminary injunction in trademark

infringement action where plaintiff “does not posit any plausible excuse for its delay.”)

Indeed, in December 2022, Defendants sent a letter through counsel stating that they

were not going to stop selling Nut Butter Bites. (Procel Decl., Exh. L at 2.) If HealthSmart

believed there was an urgent need to for relief, that “urgency” arose in December 2022. This

Motion should be denied as untimely.

2. HealthSmart Has Not Shown That Damages Are Insufficient

HealthSmart claims it will be irreparably harmed because there is a “strong likelihood

that HealthSmart will lose current and future customers” due to “likely confusion.” (Dkt.

HealthSmart does not even suggest there is actual confusion, but rather that there is a mere

possibility of confusion. That is insufficient under the law to warrant injunctive relief for alleged

trademark infringement. “When deciding whether to grant or withhold equitable relief a court

must give high regard to the interest of the general public, which is a great beneficiary from

competition.” See Aug. Storck K.G. v. Nabisco, Inc., 59 F.3d 616, 619 (7th Cir. 1995). “Damages

in trademark cases are hard to measure, but the possibility of compensation offers sufficient

protection to a trademark owner, when an injunction bids fair to stifle competition and injure

consumers in order to ward off occasional confusion.” Id. (reversing district court order granting

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preliminary injunction on ground that “possibility of confusion” does not establish irreparable

harm). HealthSmart has shown, at best, a “possibility of confusion,” not actual confusion.

3. HealthSmart Has Not Shown A Strong Likelihood of Success5

“The ultimate question underlying trademark infringement is whether consumers are

likely to be confused about the origin of products or services based on the promotion of those

products or services using a particular mark.” Grubhub Inc. v. Relish Labs LLC, 2023 WL

5919301, at *3 (7th Cir. 2023) (emphasis in original).

Seven factors comprise the likelihood of confusion analysis: (1) similarity between the

marks in appearance and suggestion; (2) similarity of the products; (3) area and manner of

concurrent use; (4) degree of care likely to be exercised by consumers; (5) strength of the

plaintiff's mark; (6) actual confusion; and (7) intent of the defendant to “palm off” its product as

that of another. Packman v. Chicago Trib. Co., 267 F.3d 628, 643 (7th Cir. 2001). “In

determining whether to grant a preliminary injunction, the district court must weigh the evidence

pertaining to each likelihood of confusion factor and balance the seven factors against each

other.” Barbecue Marx, Inc. v. 551 Ogden, Inc., 235 F.3d 1041, 1044 (7th Cir. 2000). When

analyzing the likelihood of confusion, “we ask whether consumers who might use either product

[or service] would likely attribute them to a single source.” Grubhub Inc. v. Relish Labs LLC, 80

F.4th 835, 847 (7th Cir. 2023).

5
HealthSmart states that the legal standard is both “reasonable” likelihood of success on the
merits (Dkt. 36 at 6) and “strong” likelihood of success. (Id. at 12). “Strong” and “reasonable”
are obviously different tests. The Seventh Circuit abrogated the case on which HealthSmart relies
in arguing for a “reasonable likelihood of success” standard. See Pritzker, 973 F.3d at 762. The
more stringent “strong likelihood” standard is correct and HealthSmart should be held to that.
Id.; Grubhub Inc. v. Relish Labs LLC, 2023 WL 5919301, at *9 (7th Cir. 2023) (affirming denial
of preliminary injunction where plaintiff failed to show strong likelihood of prevailing on
merits).

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a. Lack of Similarity Between the Marks

i. HealthSmart’s Evidence Is Not In the Record

In support of its Motion, HealthSmart filed an affidavit on behalf of Jeff Greder. (Dkt.

36-1.) HealthSmart filed no other affidavit or declaration. The Greder Affidavit purports to

authenticate Defendant Sweet Nothings’ “online promotions” as Exhibit 1. (Dkt. 36-1 at ¶¶ 5,

13.) But Exhibit 1 is actually the Greder Affidavit itself; and none of the attached exhibits are

Sweet Nothings’ “online promotions.” (See id.) Greder states that Exhibit 2 is Sweet Nothings’

“press and publication”; but Exhibit 2 is not that document. The Greder Affidavit references an

Exhibit 11 (Id. at ¶ 18); but HealthSmart did not file an Exhibit 11. And HealthSmart does not

even attempt to authenticate Exhibit 4-10 (they are not mentioned in the Greder Affidavit). So

some exhibits are mentioned but not filed; some are filed but not mentioned; and none are

properly authenticated. This Court cannot grant injunctive relief based on the record before it.

ii. HealthSmart’s Evidence Is Outdated

An injunction can only be issued based on the facts as they exist at the time of filing—the

evidence submitted by the plaintiff must be current. See Banks v. Cox, 2009 WL 1615529, at *1

(W.D. Wis. June 9, 2009) (denying motion for preliminary injunction where “Plaintiff's evidence

seems outdated and is irrelevant to defendant Cox's current qualifications.”).

For some unexplained reason, HealthSmart relies on a partial screenshot of an Amazon

page from April 9, 2023—six months ago. (Dkt. 36-1 at ¶16.; Procel Decl., Exh. A at 142:17-

143:7.) And HealthSmart argues that the Court should issue an injunction based on packaging of

Nut Butter Bites that was discontinued. (See Dkt. 36-5, 36-11; Porter Decl., ¶13.) HealthSmart

does not even explain where it obtained the images of that packaging in the first place.

HealthSmart cannot demonstrate a need for injunctive relief based on outdated marketing. See

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Schutt Mfg. Co. v. Riddell, Inc., 673 F.2d 202, 207 (7th Cir. 1982) (affirming denial of injunctive

relief in trademark infringement action where defendant “did not threaten to persist in or resume

the allegedly infringing or unfair conduct.”).

iii. The Marks Are Not Similar

“In determining whether two marks are similar, the comparison is made in light of what

happens in the marketplace, and not merely by looking at the two marks side-by-side.”

Packman v. Chicago Trib. Co., 267 F.3d 628, 643 (7th Cir. 2001) (internal quotations omitted).

The court must look not only at the words associated with the mark but also how they are

portrayed to consumers. See Chicago Trib. Co. v. Fox News Network, LLC, 520 F. Supp. 2d 930,

934 (N.D. Ill. 2007). Specifically, courts analyze the type, font, size, style, logo, color scheme,

and background, among others to determine the similarity of the marks. See id. (denying

preliminary injunction and holding that “REDEYE” and “Red Eye,” although effectively the

same name and both used in media, did not create likelihood of confusion based, in part, on

different manner in which marks were presented).

HealthSmart acknowledged that it is inappropriate to simply compare the two marks side-

by-side if that is not what consumers will actually see in the marketplace. (Dkt. 36 at 14.) But

HealthSmart proceeds to do exactly what is prohibited. (Dkt. 36 at 11.) HealthSmart’s entire

argument is that both parties use the “Sweet Nothings” name. And its “evidence” is a screenshot

from an Amazon search that ostensibly yields images of both parties’ products.

The companies’ Amazon pages could not be any more distinct in terms of logo, font,

photographs of the founder, photographs of models, color scheme, company story, product

descriptions, marketing as to ingredients, organic designation, and “climate pledge friendly”

designation. (Porter Decl., ¶¶ 11-17.) The mere fact that the name of the mark is the similar or

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even identical is often found to be insufficient where the parties market the products in a

different manner. See Packman, 267 F.3d at 645 (finding that even though parties used identical

marks and “the parties both produced t-shirts and hats, each offered their products in a distinctive

style and manner, minimizing the likelihood of confusion”).6

HealthSmart does not analyze anything other than the words used in connection with the

mark. It is not entitled to an injunction based on an incomplete and conclusory analysis.

iv. The Marks Are Suggestive of Different Meanings

Defendant uses “Sweet Nothings” to convey to consumers that the products have

“nothing” other than clean, whole ingredients: no added sugar, no artificial flavors, no

preservatives, no chemicals, and no dairy. (Porter Decl., ¶ 26.)

HealthSmart’s use of the mark “Sweet Nothings” does not create the same connotation in

any respect. HealthSmart’s product line has added-sugar, artificial flavors, preservatives,

chemicals, and dairy. The “Nothings” does not mean the same thing for HealthSmart as it does

for Defendant Sweet Nothings. At deposition, HealthSmart’s President and owner did not know

what his own company’s name was meant to convey. (Procel Decl., Exh. A at 21:12-22:6.)

Presumably, though, HealthSmart intends “Sweet Nothings” to suggest to consumers that there

are replacement ingredients in the Candy (e.g., synthetic fat-replacer Epogee and synthetic sugar

6
See also Planet Hollywood (Region IV), Inc. v. Hollywood Casino Corp., 80 F. Supp. 2d 815,
880 (N.D. Ill. 1999) (holding marks were not similar even though one of two words was the
same, where marks were portrayed differently in marketing, including background, logo,
margins and justification of type); Aug. Storck K.G. v. Nabisco, Inc., 59 F.3d 616, 620 (7th Cir.
1995) (“The differences between the packages are so great that it is impossible (on this record) to
believe that Nabisco is taking advantage of Storck's goodwill, or even that its industrial designers
have taken a free ride on the work of Storck's graphic arts department.”); Barbecue Marx, 235
F.3d at 1044; Uncommon, LLC v. Spigen, Inc., 305 F. Supp. 3d 825, 859 (N.D. Ill. 2018)
(“Overall, considering the disputed Capsule products in their market conditions, this Court finds
that their distinct packaging, coloring, and labeling, and use of a prominent brand name with the
mark, minimizes the similarity of the marks.”).

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sucralose) that lack the fat, calories and sugar commonly found in candies. “Sweet Nothings” is

designed to suggest the product is a diet candy. Nut Butter Bites do not contain any of these

synthetic ingredients or features, nor are they a reduced calorie, reduced fat diet product.

In short, the meaning underlying the two marks is designed to convey a completely

different commercial impression to consumers. See In Re Sears, Roebuck & Co., 2 U.S.P.Q.2d

1312 (T.T.A.B. 1987) (holding no likelihood of confusion as to legally identical mark for

“CROSS-OVER” related to women’s bras and “CROSSOVER” related to women’s sportswear,

even though the two products lines were highly related on ground that the two marks suggested

different meanings when applied to each of the categories of goods).

b. The Lack of Similarity Between the Products

The products themselves are not similar. HealthSmart sells a line of chocolate candies

infused with caramel, nougat, and nuts, among other things. They are small, diet candies in a

size, shape, and wrapping akin to a chocolate truffle. They contain dairy, added sugar, artificial

sweeteners, and synthetic facts. They contain dozens of ingredients. None of HealthSmart’s

Candy contains fruit, seeds, superfoods, or organic ingredients.

By contrast, Defendant Sweet Nothings’ Nut Butter Bites are two-bite snacks packaged

in a format somewhat similar to CLIF Bars. They are nutrient-dense, organic, sugar-free, dairy-

free, all-natural fruit and plant-based snacks. Mr. Greder, HealthSmart’s President and owner

admitted as deposition that HealthSmart’s Candy does not taste like Nut Butter Bites. (Procel

Decl., Exh. A at 87:8-17.). In fact, he admits that Nut Butter Bites are not “candy” at all. (Id. at

141:44-142:8.) They are not sold in any of the same stores, nor would even be merchandised in

the same aisle. Courts have found no infringement even with goods or services far more aligned

than those at issue here. See Smith Fiberglass Prod., Inc. v. Ameron, Inc., 7 F.3d 1327, 1329 (7th

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Cir. 1993) (finding there was no trademark infringement on ground that consumers were not

confused by similar marks on two different brands of fiberglass pipes—consumers could

distinguish between products when placed side-by-side); Barbecue Marx, 235 F.3d at 1044–45

(reversing district court order granting preliminary injunction despite fact both parties were

barbeque restaurants and therefore sold the same products—court distinguished between

products based on ambiance and theme).

HealthSmart’s characterization of Nut Butter Bites as “rival chocolate confections”

(Motion at 15) does not change the analysis. Only one of the four Nut Butter Bites flavors

contains cacao, a plant-based precursor to chocolate. And HealthSmart offers no evidence that

Nut Butter Bites are a confection. Indeed, HealthSmart does not even attempt to offer a

definition of what a confection is. The Oxford Dictionary defines a ”confection” as “a cake or

other sweet food that looks very attractive.” Nut Butter Bites are clearly not a cake; they have no

added sugar to make them sweet; and they have no glaze, coloring, or decoration to make them

look “very attractive.” Nor are they baked. They are simply nothing like HealthSmart’s Candy.

c. The Area and Manner of Concurrent Use Is Limited

First, HealthSmart has refused to produce documents reflecting its sales by distributor,

retailer and/or online platform. (Procel Decl., ¶ 20.) HealthSmart is not entitled to the benefit of

facts that it has concealed from Defendants.

Defendant Sweet Nothings sells its products in stores that have exceptionally stringent

standards concerning the quality of their foods and ingredients, including Whole Foods, Thrive

Market, and Sprouts. (Porter Decl., ¶ 4.) HealthSmart’s Candy could not be sold in these stores

because they contain synthetic and toxic ingredients that are prohibited by these stores. Sweet

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Nothings sells more than 90% of its Nut Butter Bites in locations where HealthSmart’s Candy is

not (and could not) be available. These is no possibility of confusion in any of these stores.

HealthSmart presents no evidence that its Candy is sold in any of the same brick-and-

mortar stores as Nut Butter Bites. Nor are Defendants aware of any. Instead, HealthSmart’s

Candy is sold at “mom and pop” stores. (Procel Decl., Exh. A at 98:7-14.) The lack of overlap in

stores is significant. The fact that both products are available largely in distinct channels weighs

heavily against granting a preliminary injunction. See Barbecue Marx, 235 F.3d at 1045 (finding

court “committed clear error” when it weighed area and manner factor in favor plaintiff, even

though plaintiff and defendant operated barbeque restaurants 1.4 miles from each other).

HealthSmart offers its products for sale on its websites, HealthSmart.com and

HealthSmartFoods.com. HealthSmart does not contend there is any possibility of a customer

being confused on the company’s own websites, which obviously do not sell Defendants’

products. (Procel Decl., Exh. A at 93:11-14.)

The only location that customers can purchase both Sweet Nothings and HealthSmart’s

Candy is on Amazon. Amazon comprises less than 10 % of Nut Butter Bites sales. (Porter Decl.,

¶ 7.) However, the Amazon pages disclose the source of the products, thereby preventing any

confusion. The Amazon page also reflects differences in the logo, color scheme, packaging, font,

and fundamental characteristics of the products. (Porter ¶¶ 8-16 & Exhs. A-B.) In addition,

HealthSmart’s Candy is offered in the “Candy & Chocolate Bar” section of Amazon. Nut Butter

Bites are found in the “Organic Groceries,” “Breakfast and Cereal Bars,” or “Climate Pledge

Friendly” sections. (Id., ¶ 11.)

d. Consumers Will Likely Exercise a High Degree of Care

The differences in pricing also serve to separate the products in consumers’ minds.

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“Widely varying prices—particularly of goods in a competitive market— indicate that

consumers are likely to exercise a greater degree of care.” Uncommon, LLC v. Spigen, Inc., 305

F. Supp. 3d 825, 861 (N.D. Ill. 2018) (holding that consumers were likely to exercise care in

purchasing cell phone cases, even though “cell phone cases can be low-cost,” on ground that

prices vary from $14.99 to $39.99, a 2.66-fold difference).

Nut Butter Bites are available on Amazon from a third-party retailer in a one-serving

package for $5.23. (Porter Decl., Exh. D.) HealthSmart sells a 5.5-sersving box of its candy on

Amazon for $9.99 on Amazon., or $1.82 per serving—35% of the per-serving cost of Nut Butter

Bites. (Id., Exh. E.) As in Spigen, consumers are not likely to be confused when two products

have a nearly three-fold difference in cost.

In addition, consumers interested in all-natural, organic foods tend to be highly-

discerning. They are not the same customers who purchase candy bars or diet candies.

e. Plaintiff’s Mark is Not Strong

The strength of the mark must be analyzed by the district court to determine the amount

of protection that is afforded. See Fortres Grand Corp. v. Warner Bros. Ent. Inc., 763 F.3d 696,

704 (7th Cir. 2014) (dismissing trademark infringement claim, in part, on ground that the mark

was not entitled to significant protection where it had been referenced in literature for centuries).

HealthSmart’s Sweet Nothings mark has only been in use for six years. According to

HealthSmart, its sales for 2022 were $169,000 per year. (Dkt. 36-17.) HealthSmart’s President

admitted that its Sweet Nothings mark is not famous. (Id.., Exh. A at 80:16-19, 85:5-8.). And

HealthSmart claims to have spent a total of only $150,000 on marketing its Candy; but its

president—whose affidavit was the “evidence” for this fact (Dkt. 335-1 at 10) couldn’t explain

quite how he reached this figure. (Procel Decl., Exh. A at 106:23-109:19.)

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Even the phrase “Sweet Nothings” itself was not created by HealthSmart. Its origin dates

back at least to 1776, when Mary Elizabeth Braddon wrote a poem including the stanza: “As low

he bend o’er her he loves so dear, to whisper some sweet nothing in her ear.” Thus, the phrase

had been around for over 240 years before HealthSmart used it in connection with its Candy.

And a brief internet search reveals more than a dozen companies throughout the United States

and beyond using the “Sweet Nothings” name in connection with the sale of cakes, cupcakes,

cookies, pies, pastries, and other baked goods, as well as candies and snacks. (Dkt 36-5 at 10.)

HealthSmart’s use of the phrase “Sweet Nothings” has never been exclusive. Far from it.

f. HealthSmart Has No Evidence of Actual Confusion

“The Seventh Circuit has identified actual confusion as one of the most significant

elements to be considered in determining likelihood of confusion.” Planet Hollywood (Region

IV), Inc. v. Hollywood Casino Corp., 80 F. Supp. 2d 815, 883 (N.D. Ill. 1999). “[A]n absence of

actual confusion, or a negligible amount of it, between the two products after a long period of

coexistence on the market is highly probative in showing that little likelihood of confusion

exists.” S Indus., Inc. v. Stone Age Equip., Inc., 12 F. Supp. 2d 796, 818–19 (N.D. Ill. 1998)

(quoting Aktiebolaget Electrolux v. Armatron Int'l, Inc., 999 F.2d 1, 4 (1st Cir.1993)); Falcon

Rice Mill, Inc. v. Community Rice Mill, Inc., 725 F.2d 336, 347 n. 13 (5th Cir.1984)

(“[C]oncurrent use of two marks over a substantial length of time without actual confusion

strongly suggests that there is no likelihood of confusion.”).

HealthSmart has not provided any evidence of actual consumer confusion. Tellingly,

HealthSmart’s president and owner admits that, other than name, there is no basis to confuse the

products. (Procel Decl., Exh. A at 139:3-10.)

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There is not a single instance of a customer complaining it has been confused about

whether HealthSmart manufactures Nut Butter Bites. No customer has attempted to return any

product as a result of confusion. (Procel Decl., Exh. A at 119:15-120:16; Porter Decl., ¶ 32.) No

customer has contacted Defendants at any time with a complaint or even a question about

HealthSmart. (Id., ¶¶ 30-31.) In hundreds of online reviews between HealthSmart and Defendant

Sweet Nothings, none have expressed confusion about the companies or their marks. (Id., ¶ 33.)

Instead, HealthSmart points to “Amazon redirecting HealthSmart customers to the

Infringing Goods sold by Defendants.” (Dkt. 36 at 18.) That is not evidence of actual confusion.

This relates to HealthSmart’s webpage on Amazon. HealthSmart is responsible for ensuring that

its Amazon page is working correctly. (Porter Decl., ¶ 35; Procel Decl., Exh. A at 123:4-124:23.)

The fact that there was an issue with HealthSmart’s own online store is not evidence that any

consumer was confused as to the source of the two product lines at issue in this case.

HealthSmart’s failure to adduce any evidence of actual confusion is particularly glaring

since Sweet Nothings has been selling Nut Butter Bites for over two years. “[W]here both parties

have extensively marketed their products, the absence of actual confusion is highly persuasive

evidence that confusion is not likely.” Ohio Art Co. v. Lewis Galoob Toys, Inc., 799 F. Supp.

870, 884 (N.D. Ill. 1992); Aug. Storck K.G. v. Nabisco, Inc., 59 F.3d 616, 618 (7th Cir. 1995)

(reversing grant of preliminary injunction where candy manufacturer failed to show customer

confusion even though competitor used its name in advertising—“possibility” of confusion is

insufficient); Packman, 267 F.3d at 645 (granting summary judgment against plaintiff where

anecdotal evidence of actual confusion was insufficient to create triable issue fact on

infringement claim); Planet Hollywood (Region IV), Inc. v. Hollywood Casino Corp., 80 F.

Supp. 2d 815, 883 (N.D. Ill. 1999) (rejecting trademark infringement claim due to lack of

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confusion evidence); Hubbard Feeds, Inc. v. Animal Feed Supplement, Inc., 182 F.3d 598, 603

(8th Cir.1999) (plaintiff's “failure to present evidence of consumer confusion owing to

[defendant's] allegedly infringing conduct is telling”).

g. Sweet Nothings’ Never Intended to “Palm Off” Its

Products As Those of HealthSmart

“[A] junior user's intent may support a finding of likelihood of confusion where there is

evidence that it adopted its mark to confuse consumers into thinking its own products were those

of the senior user.” Grubhub Inc. v. Relish Labs LLC, 80 F.4th 835, 856 (7th Cir. 2023).

Defendant Sweet Nothings did not attempt to capitalize on HealthSmart’s Candy—

instead, it made every attempt imaginable to distinguish itself from the Candy. From day one,

Defendant Sweet Nothings’ Amazon page has reflected a photograph of Porter with her two

children. Defendant Sweet Nothings’ Amazon pages also display the story leading to the creation

of the company. (Porter Decl., ¶¶ 10, 14.) All of Defendant Sweet Nothings’ marketing

highlights that its products are certified organic, all-natural, vegan, nutritious, “superfoods,” with

“no sugar added” and that are made from organic whole fruit, nuts and seeds. None of the

foregoing applies to HealthSmart or its Candy. Sweet Nothings adopted a color scheme, logo,

and font that are entirely distinguishable from HealthSmart’s Candy. There are also photographs

of individuals holding yoga mats and wearing workout clothes on Sweet Nothings’ Amazon

pages, signifying that this is a “clean” product. None of the foregoing remotely resembles

HealthSmart’s product or marketing.

HealthSmart also argues that “Defendants were also aware of their infringement because

of the PTO’s initial denial of its registration. (Dkt. 36 at 19.) First, HealthSmart cannot rely on

the PTO’s initial decision, which was based on a trademark registration that HealthSmart

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obtained fraudulently. Second, the PTO’s decision is irrelevant both factually and legally. In one

of the primary cases relied upon by HealthSmart, the Seventh Circuit rejected precisely the

argument made by HealthSmart here. See Grubhub Inc. v. Relish Labs LLC, 80 F.4th 835, 857

(7th Cir. 2023) (denying preliminary injunction and holding that “USPTO determinations are

often of limited value in the infringement analysis when they lack the benefit of the fuller record

developed before the district court, such as evidence about the way marks are actually used in the

marketplace.”). That is exactly the situation here. The PTO’s decision lacked any record

concerning Nut Butter Bites, or Defendant Sweet Nothings’ website, packaging, or Amazon

page. None of those things even existed at the time the PTO made its initial denial.

The PTO’s early decision supports the unremarkable proposition that a junior user cannot

register a trademark if the description overlaps with a senior user’s mark. In its ruling, the PTO

initially stated that the trademark proposed by Defendants, as it was defined, overlapped with

HealthSmart’s. As a result, the PTO concluded that “applicant’s and registrant’s goods are

legally identical.” (Dkt. 1-4 at p.52.) It did not even analyze whether the marketing, packaging,

products, or websites at issue were confusing. Again, none of those things even existed at the

time.

At most, the history with the PTO establishes that Defendants were aware of

HealthSmart’s trademark registration, which does not constitute intent to infringe. See Packman,

267 F.3d at 644 (“that defendants may have been aware of Ms. Packman's mark before

reproducing ‘The joy of six’ memorabilia does not show fraudulent intent”). If anything, Sweet

Nothings believes that any possible association with HealthSmart’s Candy hurts its branding.

(Porter Decl., ¶¶ 22-25; Procel Decl., Exh. L at 2.) That said, Sweet Nothings firmly believes that

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there is room in the market for (at least) two very distinct brands with two distinct products that

share the name “Sweet Nothings.”

E. The Motion Should Be Denied Because the Injunction Requested is Unclear

Federal Rule of Civil Procedure 65 requires that a preliminary injunction order “describe

in reasonable detail—and not by referring to the complaint or other document—the act or acts

restrained or required.” Fed. R. Civ. P. 65(d)(1)(C). The Proposed Order submitted by

HealthSmart is vague and ambiguous. The Proposed Order seeks to enjoin Defendant Sweet

Nothings’ use of a “confusingly similar imitation” of “the Mark.” That is not a standard that

could be enforced or applied by anyone reading the injunction. It is hopelessly vague. If another

court needed to enforce the injunction, it would need to have an entire trial on what constitutes a

“confusingly similar imitation.” It would need to look to other documents to define “the Mark.”

And it would leave the parties to guess whether they are complying with the Proposed Order.

This would defeat the entire purpose of granting injunctive relief in the first place. Because

HealthSmart has requested relief that this Court cannot provide, the Motion should be denied.

F. HealthSmart Has Not Established Its Entitlement to Avoid Posting a Bond

Pursuant to Federal Rule of Civil Procedure 65, the requirement to post a bond to

effectuate a preliminary injunction is mandatory. The bond must be “in an amount that the court

considers proper to pay the costs and damages sustained by any party found to have been

wrongfully enjoined or restrained.” Am. Hosp. Supply Corp. v. Hosp. Prod. Ltd., 780 F.2d 589,

612 (7th Cir. 1986) ($5 million bond on preliminary injunction).

When setting the amount of an injunction bond, “district courts should err on

the high side.” Mead Johnson & Co. v. Abbott Lab'ys, 201 F.3d 883, 888 (7th Cir. 2000)

(reversing district court order setting bond at $1 million and holding that court should consider

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$50 million—"an error in setting the bond too high thus is not serious."). Injunction bonds must

reflect the "full costs," including lost profits sustained as a result of an erroneous injunction. Id.

Sweet Nothings' trailing 12-month revenue is roughly $1.6 million for the Nut Butter

Bites product line. (Porter Decl., ¶ 37.) Projected revenue for December 2023 through December

2024 is more than $3 million. (Id.) The damage to Sweet Nothings if enjoined from selling Nut

Butter Bites through the end of trial is therefore at least $3 million. (Id., ¶ 38.) Any bond, though,

must also account for not only lost sales, but also interest, as well as harm to goodwill.

HealthSmart argues it falls within a judicially recognized exception to the bond

requirement where the movant demonstrates a “strong likelihood of success on the merits.” (Mot.

at 21 (quoting Scherr v. Volpe, 466 F.2d 1027, 1035 (7th Cir. 1972).) But based on the foregoing,

it is clear that HealthSmart lacks a “strong likelihood of success on the merits.” In fact, just the

opposite: HealthSmart has engaged in unclean hands by violating FDA regulations and

misrepresenting health information to consumers; it has presented no evidence of actual

confusion; the marks and products are entirely distinct; and the sales channels are different. If

this issue becomes ripe, Defendants will seek a bond in the amount of at least $4 million.

V. CONCLUSION

For the foregoing reasons, Defendants respectfully request that the Motion be denied in

its entirety.

Dated: November 3, 2023 Respectfully submitted,

/s/ Brian Procel_______________________

Brian Procel (CA Bar No. 218657) (admitted pro
hac vice)
Martin Pritikin (CA Bar No. 210845) (admitted pro
hac vice)
PROCEL LAW, PC
401 Wilshire Boulevard, 12th Floor

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Santa Monica, California 90401

424-788-4538
brian@procel-law.com
marty@procel-law.com

Patrick Shoulders (IN Bar No. 308-82)

Robert Burkart (IN Bar No. 16664-82 )
ZIEMER, STAYMAN, WEITZEL &
SHOULDERS, LLP
20 NW First Street, 9th Floor
Evansville, Indiana 47708
Phone: (812) 424-7575
Fax: (812) 421-5089
pshoulders@zsws.com
rburkart@zsws.com

Counsel for Defendants Beth Porter

and Sweet Nothings, Inc.

Distribution:

Service will be made electronically on all ECF-registered counsel of record via email generated
by the Court´s ECF system, as well as direct email to all counsel of record.

36