PRN HEALTH SERVCICES LLC v. INDEPENDENT HEALTH SOLUTIONS LLC (2025)

ORDERING DENYING MOTION FOR DEFAULT JUDGMENT AND GRANTING LEAVE TO AMEND

Plaintiff PRN Health Services LLC, through counsel, moves this Court for entry of default judgment under Federal Rule of Civil Procedure 55(b)(2) against Defendant Independent Health Solutions LLC, for trademark infringement under the U.S. Lanham Act, 15 U.S.C. § 1052 et seq Plaintiff seeks permanent injunctive relief and recovery of costs for this lawsuit. (Doc. 13 at 47).

BACKGROUND

On December 13, 2024, Plaintiff PRN Health Services LLC filed a complaint against Defendant Independent Health Solutions LLC, alleging a claim for federal trademark infringement under the 15 U.S.C. § 1114, a claim for federal unfair competition and a claim false designation of origin under 15 U.S.C. § 1125(a).

On December 16, 2024, the Clerk of Court issued summonses as to Independent Health Solutions LLC upon Plaintiff's request. (Docs. 3, 4). On December 26, 2024, Plaintiff filed a certification by Beadle County Sheriff's Department that Plaintiff's registered agent, Ashley Nicole Kingdon was personally served with a copy of the summons, complaint and demand for jury trial on December 18, 2024. (Doc. 8).

On January 15, 2025, Plaintiff filed a Motion and accompanying affidavit for Entry of Default as to Defendant and the Clerk of Court entered default against Defendant Independent Health Solutions LLC on January 15, 2025, pursuant to Federal Rule of Civil Procedure 55(a). (Docs. 9, 10, 11).

On March 7, 2025, Plaintiff filed a Motion for Default Judgment under Rule 55(b)(2) of the Federal Rules of Civil Procedure and a brief in support of its motion. (Docs. 12, 13). Counsel for Plaintiff certifies that on March 7, 2025, Plaintiff's Motion for Default Judgment and Memorandum in Support was served via U.S. Postal Mail upon Ashley Kingdon-Reese, the registered agent for Independent Health Solutions LLC at the registered agent's address as listed on the South Dakota Secretary of State's website. (Docs 12, 13; see also https//sosenterprise_sd_gov/BusinessServices/Business/FilingSearch_aspx). No appearance by counsel has been entered for Defendant and Defendant has failed to respond to Plaintiff's Motion for Default Judgment.

In its brief in support of its Motion for Default Judgment, Plaintiff seeks a permanent injunction to prevent Defendant from further use of Plaintiff's PRN Mark and an award of costs, i.e., the filing fee of $405 for this proceeding. (Doc. 13).

STANDARD OF REVIEW

Under Rule 55 of the Federal Rules of Civil Procedure “[w]hen a party ‘has failed to plead or otherwise defend’ against a pleading listed in Rule 7(a), entry of default under Rule 55(a) must precede grant of a default judgment under Rule 55(b).” Johnson v Dayton Elec Mfg Co., 140 F.3d 781, 783 (8th Cir. 1998). “Entry of a default under Federal Rule of Civil Procedure 55(a) is not, as such, entry of a judgment; it merely permits the plaintiff to move for a default judgment under Rule 55(b)(2), assuming that the default is not set aside under Rule 55(c).” Inman v Am Home Furniture Placement, Inc., 120 F.3d 117, 118 n.2 (8th Cir. 1997). Thus, Rule 55 requires two steps before entry of a default judgment: “first, pursuant to Fed. R. Civ. P. 55(a), the party seeking a default judgment must have the clerk enter the default by submitting the required proof that the opposing party has failed to plead or otherwise defend; second, pursuant to Fed. R. Civ. P. 55(b), the moving party may seek entry of judgment on the default under either subdivision (b)(1) or (b)(2) of the rule.” Priority Records, LLC v Flute, Civ. No. 06-4090, 2007 WL 1239244, at *1 (D.S.D. Apr. 26, 2007) (quoting Dahl v Kanawha Inv Holding Co, 161 F.R.D. 673, 683 (N.D. Iowa 1995)). In this case, the Clerk of Court has entered the default of Defendant Independent Health Solutions LLC, completing the first step in the process toward default judgment. The Court must now decide whether default judgment should be entered against Defendant pursuant to Rule 55(b)(2).

FACTS

Upon the Clerk's entry of default, all well pleaded factual allegations in the complaint are deemed admitted. Angelo Iafrate Const, LLC v. Potashnick Constr., Inc., 370 F.3d 715, 722 (8th Cir. 2004); Taylor v City of Ballwin, Mo, 859 F.2d 1330, 1333 n.7 (8th Cir. 1988). Generally, a court will not consider materials outside the pleadings in deciding a motion for default judgment. See Drake v. Laurel Highlands Found., Inc, Civ. No. 07-252, 2007 WL 4205820, at *9 (W.D. Pa. Nov. 27, 2007) (finding that the court will not consider materials outside of the pleadings in deciding a motion for default judgment). The court's consideration is limited to the complaint, written instruments attached to the complaint as an exhibit or incorporated in the complaint by reference, as well as documents upon which the complaint relies and which are integral to the complaint. Gerritsen v Glob Trading, Inc., Civ. No. 06-3756, 2009 WL 262057, at *5 n.6 (E.D.N.Y. Feb. 4, 2009) (quoting Subaru Distribs. Corp. v Subaru of Am., Inc., 425 F.3d 119, 122 (2d Cir. 2005)). The Court will consider Plaintiff's trademark registration, attached as Exhibit 1 to Plaintiff's brief as it is incorporated by reference into Plaintiff's Complaint. (Docs. 1, ¶ 16; 13-1).

Plaintiff PRN Health Services, LLC is a limited liability company organized and existing under the laws of Wisconsin, with a principal place of business in Appleton, Wisconsin. (Doc. 1, ¶ 7). Defendant Independent Health Care Solutions, LLC, is a South Dakota limited liability company with its principal office located at: 1143 Lincoln Ave. SW, Huron, South Dakota 57350. (Doc. 1, ¶ 8).

Plaintiff has offered high-quality healthcare staffing agency and related services, including temporary nursing services, under its PRN service mark (“PRN Mark”) and as a result, has gained an excellent reputation in the industry. (Doc. 1, ¶¶ 1-2). Plaintiff owns U.S. Trademark Registration No. 1,242,392 for the PRN Mark in connection with temporary nursing services (“Plaintiff's Trademark Registration”). (Doc. 1, ¶ 16). Plaintiff's PRN service mark was registered with the United States Patent and Trademark Office in 1983 and is currently active. (Docs. 1, ¶ 16; 13-1). Plaintiff's Trademark Registration protects the standard characters “PRN” used in connection with temporary nursing services without claim to any particular font style, size, or color. (Docs. 1, ¶ 16; 13-1). Plaintiff's Trademark Registration is now incontestable under 15 U.S.C. § 1065. (Doc. 1, ¶ 17). Plaintiff advertises its services through its interactive website: https://www.prnhealthservices.com/. (Doc. 1, ¶ 18).

Defendant uses the mark “PRN Professionals” (“Defendant's Mark”) to offer similar or highly related services to the same types of consumers served by Plaintiff, notably staffing and placement of registered nurses, LPN's, med aides & certified nurse aides (“Defendant's Services’). (Doc. 1, ¶¶ 4, 19). Defendant advertises its services using Defendant's interactive website at the following domain: https://www.prnprofessionals.net (“Defendant's Website”). (Doc. 1, ¶¶ 13, 20).

Defendant was not using Defendant's Mark prior to February 28, 2001. (Doc. 1, ¶ 22). Plaintiff was using its PRN Mark before Defendant first used Defendant's Mark in the United States. (Doc. 1, ¶ 23).

On December 6, 2021, Plaintiff sent Defendant a cease-and-desist letter by email and courier. (Doc. 1, ¶ 24). In Plaintiff's letter, Plaintiff advised Defendant of Plaintiff's Trademark Registration and of a likelihood of confusion between Plaintiff's PRN Mark and Defendant's Mark. (Doc. 1, ¶¶ 25, 26). Plaintiff's letter requested that Defendant promptly initiate steps to discontinue use of Defendant's Mark and any PRN-formative mark in connection with healthcare staffing agency and related services. (Doc. 1, ¶ 27). Plaintiff's letter asked Defendant to let Plaintiff's counsel know if they believed they had a legally sufficient justification for using the PRN Mark. (Doc. 1, ¶ 28). Plaintiff sent follow-up correspondence on or about June 10, 2022, and June 26, 2024. (Doc. 1, ¶ 29). Defendant has never responded to Plaintiff's correspondence, including Plaintiff's letter, and continues to use Defendant's Mark. (Doc. 1, ¶ 31).

DISCUSSION

I. Merits of Default Judgment Motion

“[T]he entry of default by the Clerk does not entitle the non-defaulting party to a default judgment as a matter of right.” United States v $345,510 00 in U.S Currency, Civ. No. 01-497, 2002 WL 22040, at *2 (D. Minn. Jan. 2, 2002). Whether to enter default judgment against a party is committed to the district courts’ discretion. Belcourt Pub Sch Dist v Davis, 786 F.3d 653, 661 (8th Cir. 2015). Although default judgments are generally disfavored because there is a judicial preference for adjudication on the merits, a defendant's lack of participation in litigation is a basis for granting default judgment. Idle Hands Enterprises, LLC v No Coast Tattoo, LLC, Civ. No. 22-2186, 2023 WL 5994702, at *2 (D. Minn. Sept. 15, 2023) (citing Marshall v Baggett, 616 F.3d 849, 852 (8th Cir. 2010)). When a party defaults, “the factual allegations of a complaint (except those relating to the amount of damages) are taken as true.” Murray v Lene, 595 F.3d 868, 871 (8th Cir. 2010). However, to enter a final judgment in favor of the moving party, it is “incumbent upon the district court to ensure that the unchallenged facts constitute a legitimate cause of action.” Marshall, 616 F.3d at 852-53 (stating that a district court must consider “whether the unchallenged facts constitute a legitimate cause of action, since a party in default does not admit mere conclusions of law.”) (citing Murray, 595 F.3d at 871).

Plaintiff moves for default judgment on its claim for federal trademark infringement under the Lanham Act, 15 U.S.C. § 1114. (Doc. 13 at 38) (stating elements of a trademark infringement claim). The purpose of the Lanham Act is “to protect persons engaged in commerce against false advertising and unfair competition.” Am Italian Pasta Co v New World Pasta Co, 371 F.3d 387, 390 (8th Cir. 2004) (citation omitted). “The holder of a registered mark (incontestable or not) has a civil action against anyone employing an imitation of it in commerce when ‘such use is likely to cause confusion, or to cause mistake, or to deceive.’ ” KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., 543 U.S. 111, 117 (2004) (citing 15 U.S.C. § 1114(1)(a)).¹

Plaintiff, PRN Health Services LLC, owns U.S. Trademark Registration No. 1,242,392 for the PRN service mark in connection with temporary nursing services. (Doc. 1, ¶ 15). The Complaint establishes that Plaintiff has offered healthcare agency placement services under its PRN Mark since 1976. (Docs. 1, ¶¶ 2, 16; 13-1). The PRN Mark was registered with the United States Patent and Trademark Office in 1983. (Docs. 1, ¶ 16; 13-1). Plaintiff advertises its services through its interactive website: https://www.prnhealthservices.com/staffing-solutions. (Doc. 1, ¶ 18).

Defendant uses the mark “PRN Professionals” to offer similar or highly related services, particularly staffing services involving the placement of registered nurses, licensed practical nurses, medication aides and certified nurse aides, to the same types of consumers served by Plaintiff. (Doc. 1, ¶¶ 4, 19). Defendant advertises its services under Defendant's Mark through Defendant's interactive website at the following domain: https://www.prnprofessionals.net. (Doc. 1, ¶ 13).

To establish trademark infringement under the Lanham Act, a plaintiff must prove that 1) the plaintiff has a valid, protectable mark; 2) the defendant's use of its mark was unauthorized; and 3) this use is likely to cause confusion among consumers. Journey Group Co's v Sioux Falls Constr, LLC, Civ. No. 16-4125, 2017 WL 1376369, at *3 (D.S.D. Apr. 12, 2017) (citing Cmty. of Christ Copyright Corp v Devon Park Restoration Branch of Jesus Christ's Church, 634 F.3d 1005, 1009 (8th Cir. 2011)).

1. Valid, protectable mark & Unauthorized Use

Registration of a trademark is prima facie evidence of the validity of the mark. See 15 U.S.C. § 1057(b). When a trademark meets certain requirements, primarily continuous use for five years after registration, it becomes incontestable. See 15 U.S.C. § 1065. The fact that a registered trademark has achieved incontestable status is “conclusive evidence of the validity of the registered mark․of the registrant's ownership of the mark, and of the registrant's exclusive right to use the registered mark in commerce ․ in connection with the goods or services specified․” 15 U.S.C. § 1115(b).

In the present case, Plaintiff alleges that its PRN Mark, registered with the United States Patent and Trade Office since 1983 in connection with temporary nursing services, is incontestable under 15 U.S.C. § 1065. (See Doc. 1, ¶¶ 17, 33). Taking these allegations as admitted satisfies that Plaintiff owns a valid, protectable mark.² Plaintiff's allegation that it sent a cease-and-desist letter to Defendant demanding that it discontinue use of Plaintiff's PRN Mark satisfies that Defendant's use of the PRN Mark is unauthorized.

2. Likelihood of confusion

In a Lanham Act infringement claim, the burden of proving likelihood of confusion rests with the plaintiff, even for an incontestable mark. KP Permanent Make-Up, Inc v Lasting Impression I, Inc., 543 U.S. 111, 118 (2004). In the Eighth Circuit, “likelihood of confusion is a finding of fact.” SquirtCo v Seven-Up Co, 628 F.2d 1086, 1091 (8th Cir. 1980).

The following six factors inform the likelihood of confusion determination:

1) The strength of the trademark owner's mark; 2) the similarity between the trademark owner's mark and the alleged infringing mark; 3) the degree to which the allegedly infringing services competes with the trademark owner's services; 3) the alleged infringer's intent to confuse the public; 5) the degree of care reasonably expected of potential customers; and 6) evidence of actual confusion.

Cmty of Christ Copyright Corp., 634 F.3d at 1009. “[N]o one factor controls, and because the inquiry is inherently case-specific, different factors may be entitled to more weight in different cases.” Cmty of Christ Copyright Corp, 634 F.3d at 1009; see also Journey Group Co's, 2017 WL 1376369, at *3 (D.S.D. Apr. 12, 2017) (citing Mutual of Omaha Ins Co v. Novak, 836 F.2d 397, 399 n.3 (8th Cir. 2000) (“These are not necessarily the only factors that might be relevant in a particular case. The ultimate inquiry always is whether, under all the circumstances, there exists a likelihood of confusion between the plaintiff's trademark and the allegedly infringing use.”)).

a. Strength of the mark

A mark is considered to be a strong one when it effectively identifies the mark owner in the public mind. Bd of Trustees of Univ of Ark v Prof Therapy Servs., Inc, 873 F.Supp. 1280, 1285 (W.D. Ark. Jan. 11, 1995). The weaker the mark, the less the likelihood of confusion, and therefore the narrower the scope of protection. General Mills, Inc v Kellogg Co, 824 F.2d 622, 626 (8th Cir. 1987) (citing Telemed Corp v Tel-Med, Inc, 588 F.2d 213, 219-20 (7th Cir. 1978)); M-F-G Corp v EMRA Corp, 626 F.Supp. 699, 702 (N.D. Ill. Dec. 12, 1985) (citing Telemed Corp., 588 F.2d at 219) (stating that trademark protection of a weak mark may be limited to similar goods similarly marketed).

Incontestable status does not preclude a defendant from arguing that the mark is weak and not infringed because “incontestable status does not make a weak mark strong.” J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 32:155 (4th ed. 2014) (citing Oreck Corp v U.S Floor Systems, Inc, 803 F.2d 166 (5th Cir. 1986)); see also Lone Star Steakhouse & Saloon v Alpha of Virginia, 43 F.3d 922 (4th Cir. 1995) (“Incontestability affects the validity of the trademark but does not establish the likelihood of confusion necessary to warrant protection from infringement.”); Woodroast Sys, Inc v Restaurants Unlimited, Inc., 793 F.Supp. 906, 912 n.10 (D. Minn. May 18, 1992) (citing Am Cyanamid Co. v. S.C Johnson, Inc, 729 F.Supp. 1018, 1024 (D.N.J. 1989)).

Two relevant measurements of a mark's strength are its conceptual strength and its commercial strength. ZW USA, Inc v PWD Sys, LLC, 889 F.3d 441, 446 (8th Cir. 2018). A mark's conceptual strength and distinctiveness depends on its classification as (1) arbitrary or fanciful, (2) suggestive, (3) descriptive, or (4) generic. Roederer v J. Garcia Carrion, S A, 732 F.Supp.2d 836, 864 (D. Minn. Aug. 10, 2010) (citing Insty*Bit, Inc v Poly-Tech Indus, Inc, 95 F.3d 663, 672-73 (8th Cir. 1996)). On this spectrum, an arbitrary or fanciful mark is entitled to the highest level of protection, while a generic mark is afforded no trademark protection. See United States PTO v Booking com B B, 591 U.S. 549, 553-54 (2020); Sensient Techs Corp. v Sensory Effects Flavor Co, 613 F.3d 754, 763 (8th Cir. 2010).

“Suggestive marks subtly indicate something about the product, thus a mark is deemed suggestive if it requires imagination, thought or perception to reach a conclusion concerning the nature of the goods.” Woodroast Sys, Inc v Restaurants Unlimited, Inc, 793 F.Supp. 906, 911 (D. Minn. May 18, 1992) (citing Beer Nuts, Inc v Clover Club Foods Co, 711 F.2d 934, 939 (10th Cir. 1983)); see also Duluth News-Tribune v Mesabi Publ'g Co, 84 F.3d 1093, 1096 (8th Cir. 1996). For example, in Am Dairy Queen Corp v W B Mason Co, 543 F.Supp.3d 695, 713 (D. Minn. 2021), the court found that the Dairy Queen BLIZZARD mark was suggestive rather than descriptive because it “suggests the cold, diffuse characteristics of the product,” rather than conveying an “immediate idea of the ingredients, qualities or characteristics of the goods.” Descriptive marks, in contrast, are those that do not require imagination, thought, or perception to reach a conclusion as to the nature of its goods. Frosty Treats Inc. v Sony Computer Entertainment Am. Inc, 426 F.3d 1001, 1005 (8th Cir. 2005). A mark is descriptive if it conveys an “immediate idea of the ingredients, qualities or characteristics of the goods [or services]” it sells. Id (citing Stuart Hall Co, Inc. v Ampad Corp, 51 F.3d 780, 785-86 (8th Cir. 1995)). For example, in Frosty Treats Inc. v Sony Computer Entertainment Am Inc., the Eighth Circuit found that the mark “Frosty Treats” was, at best, descriptive because the owner was in the business of selling frozen desserts out of ice cream trucks and the mark conveyed “an immediate idea of the qualities and characteristics of the goods that its sells.” Id

The line between what constitutes a descriptive mark and what constitutes a suggestive mark is not altogether clear, and ultimately the correct categorization of a particular mark is a question of fact. Shade's Landing, Inc v Williams, 76 F.Supp.2d 983, 988 (D. Minn. 1999) (citing Anheuser-Busch Inc. v Stroh Brewery Co, 750 F.2d 631, 635 (8th Cir. 1984)). “If the mental leap between the word and the product's attributes is not almost instantaneous, this strongly indicates suggestiveness, not direct descriptiveness.” Shade's Landing, Inc, 76 F.Supp.2d at 989 (citing ConAgra, Inc v Geo. A. Hormel & Co, 784 F.Supp. 700, 708 (D. Neb. 1992) (quoting 1 J. McCarthy, Trademarks and Unfair Competition § 11:21, at 492), aff'd, 990 F.2d 368 (8th Cir. 1993)); see also Worthington Foods, Inc v Kellogg Co, 732 F.Supp. 1417, 1435 (S.D. Ohio Mar. 1, 1990) (“A suggestive mark may convey information but only with ‘some reflection’ or after a ‘multi-stage reasoning process’ on the part of the buyer.”).

Plaintiff argues that it is has a strong mark because it has been continually used to advertise its healthcare staffing placement services since 1976. (Docs. 13 at 40-41; 13-1). Plaintiff argues that its PRN mark is fanciful or arbitrary, or at the very least, suggestive. (Doc. 13 at 41). In support, Plaintiff states that while “PRN” may be seen as an initialism for “pro re nata” which means “as needed” or “as the circumstances require” in Latin, consumers have to use their imagination to comprehend the mark as descriptive of the healthcare staffing services offered by Plaintiff. (Doc. 13 at 41). Specifically, Plaintiff argues that consumers have to use their imagination to connect PRN to the abbreviation of the Latin phrase and then to Plaintiff's healthcare staffing agency services. (Doc. 13 at 41).

The test for deciding whether a word is descriptive is what consumers of healthcare staffing services would understand the Latin phrase “pro re nata” and its abbreviation, “PRN,” to mean. Anheuser-Busch Inc, 750 F.2d at 638 (“[consumers] understand by the word for whose use the parties are contending.”); see also Blisscraft v. United Plastics Co., 294 F.2d 694, 699 (2d Cir. 1961) (“The critical question is whether the mark is descriptive to the prospective purchasers of the article.”). Any competent source, including dictionaries, newspapers, consumer surveys, advertisements, and other publications, may provide evidence of the public's understanding of the term at issue. In re Northland Products, Inc., 777 F.2d 1556, 1559 (Fed. Cir. 1985); Fair Isaac Corp. v Experian Info Solutions, Inc., 650 F.3d 1139, 1148 n.4 (8th Cir. 2011).

Merriam-Webster Dictionary defines the Latin phrase “pro re nata” as “for the present matter; under present circumstances; as needed” and indicates that its abbreviation “prn” is used in medical prescriptions. https://www.merriam-webster.com/dictionary/pro%20re%20nata. While Merriam-Webster indicates that American consumers may be familiar with the meaning of the abbreviation “prn” in the medical prescription context, there is no suggestion that American consumers would recognize “prn” as being descriptive of healthcare staffing services provided by Plaintiff. Because consumers of healthcare staffing services are required to engage in some reflection or multi-stage reasoning process in order to understand the meaning of the PRN Mark, the Court finds that the PRN Mark is at least suggestive. See Worthington Foods, Inc, 732 F.Supp. at 1435 (“A suggestive mark may convey information but only with ‘some reflection’ or after a ‘multi-stage reasoning process’ on the part of the buyer.”).

“Marketplace recognition value” or “commercial strength” is also consideration in assessing a trademark's strength. ConAgra, Inc. v. George A. Hormel & Co, 990 F.2d 368, 369 (8th Cir. 1993). “[P]ublic recognition and renown” of the mark is evidenced by the extent of advertising, sales volume, features and reviews in publications, and survey evidence. Roederer v. J. Garcia Carrion S A., 732 F.Supp.2d 836, 867 (D. Minn. 2010). For purposes of the likelihood of confusion analysis, the relevant market for evaluating commercial strength is “the class of customers and potential customers of a product or service, and not the general public.” Id (quoting Palm Bay Imports, Inc. v Veuve Clicquot Ponsardin Maison Fondee En 1772, 396 F.3d 1369, 1374-76 (Fed. Cir. 2005)).

Even though Plaintiff has failed to establish some of the other facts showing commercial strength, the uncontested facts establish that Plaintiff PRN Health Services LLC has used the PRN Mark in healthcare staffing services marketplace for decades and as a result, has gained an excellent reputation in this industry. (Doc. 1, ¶¶ 1, 2). The Court finds that these uncontested facts weigh in favor of “commercial strength.” See Zerorez Franchising Sys., Inc v. Distinctive Cleaning, Inc., 103 F.Supp.3d 1032, 1042 (D. Minn. 2015) (finding that longevity of use of the mark, increase in market share since use of mark began, advertising in major newspapers, reviews in publications, and advertising expenditures establish the commercial strength of the mark); see also Worldcare Ltd Corp. v World Ins Co, Civ. No. 8:11-99, 2011 WL 1770445, at *6 (D. Neb. May 9, 2011) (finding that plaintiff's long-term use of the WORLDCARE mark is a symbol of goodwill and identifies the origin or ownership of its services, particularly given the fact that the mark is also the name of the company); Evantigroup, LLC v. Mangia Mobile, LLC, Civ. No. 2011 WL 13257270, at *5 (E.D. Mo. Sept. 19, 2011) (finding the Mangia Italiano mark to be commercially strong in the St. Louis area because the company spent a great deal of time and money on marketing the Mangia Italiano restaurant and pasta products in the St. Louis area, was involved in community activities, and had favorable media coverage). That being said, Plaintiff has not established whether this “commercial strength” is confined to Wisconsin, their principal place of business, or whether the market renown of the PRN Mark extends further geographically.

Overall, the Court finds that the strength of the PRN Mark weighs in favor of Plaintiff.

b. Similarity of the marks

Under this second step, the Court must consider the similarity between the “PRN” and “PRN Professionals” marks. “Rather than consider the similarities between the component parts of the marks, [a court] must evaluate the impression that each mark in its entirety is likely to have on a purchaser exercising attention usually given by purchasers of such products.” Sensient Tech Corp. v. SensoryEffects Flavor Co., 613 F.3d 754, 764 (8th Cir. 2010)). “The use of identical, even dominant, words in common does not automatically mean that two marks are similar.” Id (quoting Gen Mills, Inc. v Kellogg Co, 824 F.2d 622, 627 (8th Cir. 1987)). In deciding whether the total effect conveyed by the two marks is confusingly similar a court may consider the “visual, aural, and definitional attributes” of the marks (“the sight, sound, meaning test”). Id (citing Luigino's, Inc. v. Stouffer Corp., 170 F.3d 827, 830 (8th Cir. 1999)). However, as a preliminary to a final comparison of the conflicting marks as a whole, it is appropriate to give greater weight to “dominant” parts of a composite mark, for it is that which may make the greatest impression on the ordinary buyer. McCarthy on Trademarks § 23:42 at 229; see also Drake University v. Des Moines Area Community College Found, Civ. No. 4:24-0027, 2024 WL 5440859, at *12 (S.D. Iowa Nov. 12, 2024) (“Confusion is more likely where the dominant potions of the mark are the same.”). Here, the dominant portions of both marks are the same, “PRN.” The Court also notes that Defendant by default admits that “Defendant's Mark is confusingly similar to Plaintiff's PRN Mark․” (Doc. 1, ¶ 5).

Where the services are directly competitive, the degree of similarity between marks required to prove a likelihood of confusion is less than in the case of dissimilar services. Am Steel Foundries v Robertson, 269 U.S. 372, 382 (1926) (stating that probability of confusion when goods traded are different is “more remote than when the articles are of like kind”); see also SquirtCo. v. Seven-Up Co., 628 F.2d 1086, 1091 (8th Cir. 1980). Conversely, the greater the similarity in the marks, the lesser the similarity required in the goods or services of the parties to support a finding of likely confusion. McCarthy on Trademarks § 23:20.50 at 151 (citing In re Opus One, Inc., 60 U.S.P.Q.2d 1812, 2001 WL 1182924 (Trademark Trial & App. Bd. 2001)). If the marks are very similar, it is “only necessary that there be a viable relationship between the goods or services in order to support a holding of likelihood of confusion.” Id. at 152 (citing In re Concordia Int'l Forwarding Corp, 222 U.S.P.Q. 355, 1983 WL 51828 (T.T.A.B. 1983)). If the marks are identical, then the degree of similarity between the parties’ good or services can be quite large and there will still be a likelihood of confusion. Id (citing Kohler Co v. Baldwin Hardware Corp., 82 U.S.P.Q.2d 1100, 2007 WL 117575 (T.T.A.B. 2007)).

The Court finds the following two cases instructive in the similarity of marks analysis. In Moon Seed LLC v Weidner, 604 F.Supp.3d 780 (S.D. Iowa 2022), the court found that the “Mood Seed” mark and the “Moon Seed Service” mark sound almost identical and because both companies were in the seed vending business in Iowa, the court concluded that the commercial meaning of the marks was similar. Id. at 791. In Fischer & Frichtel Customer Homes, LLC v. Fischer Mgmt, LLC, the district court held that the two marks were not similar. Civ. No. 4:21-0470, 2021 WL 1750174, at *5 (E.D. Mo. May 4, 2021). The Fischer court found that it had little basis to hold that “Fischer” was the dominant of the two names in the plaintiff's mark because the evidence suggested that Fischer and Frichtel were intertwined in the minds of consumers and considering the mark as a whole, it found “Fischer & Frichtel” was readily distinguishable from “Fischer Homes,” to sophisticated homebuying and homebuilding consumers. Id.

Here, the PRN Mark and the PRN Professionals Mark use the same dominant word in connection with healthcare staffing services, notably placement of nurses, med aides and certified nurse aids. (Doc. 1, ¶ 19). Defendant admits by default that its services are marketed and sold to the same types of consumers served by Plaintiff. (Doc. 1, ¶ 4). The similarity of the marks weigh heavily in favor of Plaintiff.

c. Degree of Competition

A showing of direct competition is not required for the analysis under this factor. Kemp v. Bumble Bee Seafoods, Inc, 398 F.3d 1049, 1056 (8th Cir. 2005); see also Mutual of Omaha Ins Co. v Novak, 836 F.2d 397, 399 (8th Cir. 1987) (stating that no direct competition required because “confusion, not competition, is the touchstone of trademark infringement.”). Rather, this factor requires a broader examination of the services’ relationship in the market. See Kemp, 398 F.3d at 1056. Where services are related, it is reasonable for consumers to think that the services come from the same source and confusion is more likely. Id Where services are wholly unrelated, however, this factor weighs against a finding that confusion is likely. Id

Products are in competitive proximity when there is similarity or overlap in their sales outlets, trade channels, geographic distribution, and customers. See Moon Seed LLC v Weidner, 604 F.Supp.3d 780, 792 (S.D. Iowa May 27, 2022) (considering similarities in the parties’ goods and services, customers, trade channels, and geographic areas of operation, in determining competitive proximity); Roedrer v J. Garcia Carrion, S A, 732 F.Supp.2d 836, 868-69 (D. Minn. 2010) (citation omitted); J & B Wholesale Distrib, Inc. v Redux Beverages, LLC, 621 F.Supp.2d 678, 686 (D. Minn. 2007) (finding competitive proximity based on overlapping geographic distribution and similarity of trade channels). For example, in NSM Resources Corp v. Target Corp., the Court found that the parties’ primary products bearing the contested mark, a children's skate shoe and an adult men's running shoe, were not in direct competition, but could potentially lead to confusion because the products were both footwear, sold in a similar discount store setting, and for the same or similar price. 636 F.Supp.2d 857, 865-66 (D. Minn. 2008). In Gateway, Inc v Companion Products, Inc., the court found that a reasonable inference could be made for summary judgment purposes that the parties, Gateway, Inc., and Companion Products, Inc., were in competitive proximity to each other because Gateway's products are sold worldwide and it advertises through a plethora of media, including magazines, catalogs, retails stores, and the internet and CPI conducted most of its sales through the internet, catalogs, retail stores and novelty shops. 320 F.Supp.2d 912, 921 (D.S.D. 2002). In Davis v. Walt Disney Co, the court found that no competitive proximity existed between a children's television show, “Earth Protectors,” and Defendant's use of that term on environmental pamphlets, t-shirts, or the sporadic use of the mark on public access cable television. 393 F.Supp.2d 839, 845 (D. Minn. 2005). In J & B Wholesale Distrib, Inc, 621 F.Supp.2d 678 (D. Minn. 2007), the court found that the use of the plaintiff's mark, registered for use in connection with its production and distribution of meat products, by the defendant on an energy drink was likely to cause confusion based on the similarity of the channels through which the product was sold, and the fact that a consumer could reasonably believe the plaintiff had launched into the energy drink market. Id at 682, 686.

Here, the services in dispute include healthcare staffing services for nurses marketed to the same types of consumers served by Plaintiff. (Doc. l, ¶¶ 4, 19). Both entities market their services online. However, it is this Court's view that the fact that both parties use websites to market their services does not weigh heavily in favor of competitive proximity, considering most companies tend to market their products and services in some capacity via the internet. No exhibits of the websites were attached to the complaint and the complaint is devoid of allegations relating to trade channels and sales outlets utilized by the parties for these services and whether sales are conducted by the parties via their websites, nor is there any information relating to the geographic distribution of Defendant and Plaintiff's services. Defendant's admits by default that its and Plaintiff's services are confusingly similar or highly related and are marketed to the same types of consumers weigh in favor of likelihood of confusion. While Defendant admits by default that it does business in South Dakota, Doc. 1, ¶ 13, Plaintiff has not shown that it also provides its services to consumers in South Dakota, only that its website is accessible to internet users in South Dakota. The parties are 481 air miles apart, so based on the facts before the Court, they are distant competitors. Because Plaintiff did not allege facts regarding similarity or overlap between Plaintiff and Defendant in sales outlets, trade channels, or geographic distribution, the Court finds that overall, the degree of competition factor does not weigh in favor of either party.

Before the Court moves on to the other factors, the Court notes that in their Motion for Default Judgment, Plaintiff specifically requests that the Court permanently enjoin and restrain the “Defendant and each of its agents, representatives, employees, officers, attorneys, successors, assigns, affiliates, and any persons in privity or active concert or participation with any of them from using the PRN Mark with or without an accompanying logo or any other designation, alone or combined with other words or symbols, as a trademark or trade name component or otherwise, to market, advertise, distribute or identify Defendant's Services where that designation would create a likelihood of confusion, mistake or deception with Plaintiff's PRN Mark.” (Docs. 1, 13). Plaintiff's principal place of business is in Appleton, Wisconsin and Defendant's principal place of business is in Huron, South Dakota. (Doc. 1, ¶¶ 7, 8). Failure to show geographic distribution of the parties’ services is required to obtain Plaintiff's requested relief in this case—that of a permanent injunction. The Eighth Circuit has specifically stated that “to enjoin a geographically remote infringer, the registered owner must prove that its trademarked product [or service] and the infringing products [or services] are being sold in the same geographic area, or that the owner has concrete plans to expand into the infringer's trade area.” Idle Hands Enterprises, LLC v No Coast Tattoo, LLC, Civ. No. 22-2186, 2023 WL 5994702, at *3 (D. Minn. Sept. 15, 2023) (citing Minn Pet Breeders, Inc v Schell & Kampeter, Inc, 41 F.3d 1242, 1246 (8th Cir. 1994)) (analyzing geographic product distribution when granting default judgment and awarding permanent injunctive relief); Comidas Exquistos, Inc v O'Malley & McGee's, Inc, 775 F.2d 260, 262 (8th Cir. 1985) (if an infringer's mark “is confined to a distinct geographic market from [the plaintiff's] and there is no present likelihood that [the plaintiff] will expand into [the infringer's] market, [the plaintiff] is not entitled to relief because there is no danger of public confusion.”)).

d. Intent to Confuse

Plaintiff argues that Defendant had constructive notice of its trademark registration and continued to use its allegedly infringing mark even after receiving the cease-and-desist letter informing Defendant of Plaintiff's registration. Accordingly, Plaintiff argues that the Court should presume Defendant's intent to pass off its services for those of Plaintiff. (Doc. 13 at 43).

“Knowledge of another's product and an intent to compete with that product is not equivalent to an intent by a new entrant to a market to mislead and to cause consumer confusion.” Luigino's, Inc v Stouffer Corp, 170 F.3d 827, 831 (8th Cir. 1999). Additionally, most courts have held that “[a]n intent to confuse cannot be teased out of a business's decision to continue the challenged use after receiving a cease and desist letter.” Idle Hands Enterprises, 2023 WL 5994702, at *4 (D. Minn. Sept. 15, 2023) (citing 4 McCarthy on Trademarks and Unfair Competition § 23:120); Am Dairy Queen Corp v. W.B Mason Co, Inc. Civ. No. 18-693, 2022 WL 2760024, at *71 (citing Roederer v. J Garcia Carrion, S A, 732 F.Supp.2d 836, 872 (D. Minn. 2010) (“Refusal to abandon [plaintiff's] mark in the face of a cease and desist letter cannot demonstrate bad faith standing alone.”); Straus v Notaseme Hosiery Co, 240 U.S. 179, 181 (1916) (“Defendants’ persistence in their use of the design after notice proves little or nothing against them”).

In the present case, the Court finds that the uncontested facts are insufficient to establish Defendant's intent to confuse the public. Nevertheless, this is not fatal to Plaintiff's claims because proof of bad intent is not required for success in an infringement claim. Sensient Tech. Corp. v. SensoryEffects Flavor Co, 613 F.3d 754, 766 (8th Cir. 2010).

e. Degree of care reasonably expected of potential customers

To determine the degree of care exercised by consumers, this Court is to “stand in the shoes of the ordinary purchaser, buying under the normally prevalent conditions of the market and giving the attention such purchasers usually give in buying that class of services.” ZW USA, Inc v PWD Sys., LLC, 889 F.3d 441, 447 (8th Cir. 2018). Plaintiff states that there “is no indication one way or another that there is a particularly higher or lower standard of care with respect to healthcare placement staffing services, especially given the variety of services and persons involved.” (Doc. 13 at 44). Accordingly, the Court finds this factor to be neutral in its analysis.

f. Incidents of Actual Confusion

While actual confusion is not essential to a finding of infringement, its existence is positive proof of the likelihood of confusion. See SquirtCo v Seven-Up Co., 628 F.2d 1086, 1091 (8th Cir. 1980). Plaintiff has cited to no incidents of actual confusion in the marketplace. This factor does not weigh for or against either party on the likelihood of confusion.

3. Summary

In sum, the Court finds that based on the uncontested facts, Plaintiff has a valid protectable mark. However, on the whole, the uncontested allegations are insufficient to show a likelihood of confusion. While Plaintiff has shown that the PRN Mark is strong and that Defendant's Mark is confusingly similar, there has been no showing that consumers use similar trade channels or sales outlets to access the parties’ services, nor has there been any showing of overlapping trade areas or concrete plans by Plaintiff to expand into the Defendant's trade area, thus entitling Plaintiff to injunctive relief. See Minn Pet Breeders, Inc v. Schell & Kampeter, Inc., 41 F.3d 1242, 1246 (8th Cir. 1994)).

Plaintiff's motion for default judgment is denied without prejudice to its renewal.

Accordingly,

IT IS HEREBY ORDERED that:

1. Plaintiff's Motion for Default Judgment is DENIED without prejudice;

2. Plaintiff is granted leave to amend its complaint; Plaintiff shall have twenty (20) days from the date of this order to file an amended complaint; and

3. The Clerk of Court is directed to mail a copy of this order to the following last-known address of the registered agent:

Independent Health Solutions LLC

ATTN: Ashley Kingdon-Reese, Registered Agent

108 Nicollet SW

Huron, SD 57350

Dated this 28th day of May, 2025.

FOOTNOTES

1.   Section 1114 of the Lanham Act imposes liability for “[a]ny person who shall, without the consent of the registrant use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark in connection with the sale, offering for sale, distribution, or advertising of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive” 15 U S C § 1114(a) A mark shall be deemed to be “use in commerce” “on services when it is used or displayed in the sale or advertising of services and the services are rendered in commerce, or the services are rendered in more than one State or in the United States and a foreign country and the person rendering the services is engaged in commerce in connection with the services” 15 U S C § 1127.

2.   Plaintiff's registration of the PRN Mark also creates a rebuttable presumption that the mark is valid Aromatique, Inc v Gold Seal, Inc., 28 F.3d 863, 869 (8th Cir 1994). Defendant has not filed an Answer to Plaintiff's trademark infringement claim or otherwise defended Plaintiff's Motion for Default Judgment and has thus failed to rebut the presumption that Plaintiff owns a valid, federally registered trademark See Idle Hands Enterprises, LLC v No Coast Tattoo, LLC, Civ No 22-2186, 2023 WL 5994702, at *3 (D Minn Sept 15, 2023) (“Plaintiff owns a federally registered trademark, which is presumed valid”), see also Evans v Gavin, Civ No. 19-0094, 2019 WL 10255629, at *4 (N D Iowa Dec. 31, 2019) (“[W]hen a motion for default judgment involves a Lanham Act claim based on a registered trademark courts do not have to spend much analysis on whether the plaintiff sufficiently alleged the existence of a valid trademark”)

Lawrence L. Piersol United States District Judge