Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 1 of 34 PageID# 136 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF VIRGINIA ALEXANDRIA DIVISION EXPRESS HOMEBUYERS USA, LLC, Plaintiff, Civil Action No. 1:17-cv-00736-TSE-IDD v. JURY TRIAL DEMANDED WBH MARKETING, INC., Defendant. WBH MARKETING, INC., Counterclaim Plaintiff, v. EXPRESS HOMEBUYERS USA, LLC, and LAWRENCE BRADFORD CHANDLER III, Counterclaim Defendants. DEFENDANT AND COUNTERCLAIM PLAINTIFF’S ANSWER TO PLAINTIFF’S FIRST AMENDED COMPLAINT AND COUNTERCLAIMS For its answer under Federal Rule of Civil Procedure 8(b) to Plaintiff and Counterclaim Defendant Express Homebuyers USA, LLC’s (“Express Homebuyers”) First Amended Complaint, Defendant and Counterclaim Plaintiff WBH Marketing, Inc. (“WBH”) states as follows: 1 Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 2 of 34 PageID# 137 PRELIMINARY STATEMENT AND NATURE OF THE ACTION 1. WBH denies the allegations in paragraph 1 and avers that its federally registered WE BUY HOUSES® and WEBUYHOUSES.COM® marks (“the WBH marks”) are incontestable, valid, and enforceable. 2. WBH admits that it has exclusive, nationwide rights in the WBH marks and that it demanded that Express Homebuyers stop using the WBH marks. WBH denies the remaining allegations in paragraph 2. 3. WBH admits that its predecessor-in-interest entered into an agreement with a third party to acquire exclusive rights in the application for registration of the WE BUY HOUSES® mark and that WBH then entered into an agreement with its predecessor-in-interest to acquire exclusive rights in that mark. WBH denies the remaining allegations in paragraph 3 and avers that the WBH marks are incontestable, valid, and enforceable. 4. WBH denies the allegations in paragraph 4 and avers that the WBH marks are incontestable, valid, and enforceable and that it enforces its exclusive, nationwide rights in the WBH marks against those who infringe the marks. 5. WBH admits that it enforces its exclusive, nationwide rights in the WBH marks against those who infringe the marks, including Express Homebuyers. WBH denies the remaining allegations in paragraph 5. 6. WBH admits that it filed take-down complaints with YouTube.com asserting its exclusive, nationwide rights in the WBH marks and that YouTube.com removed videos that infringed those rights, including videos posted by Express Homebuyers. WBH denies the remaining allegations in paragraph 6 and avers that the WBH marks are incontestable, valid, and enforceable. 2 Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 3 of 34 PageID# 138 7. WBH admits that Express Homebuyers seeks cancellation of WBH’s U.S. Reg. Nos. 3,149,336 (“WE BUY HOUSES”) and 3,235,523 (“WEBUYHOUSES.COM”) and declaratory relief. WBH denies that Express Homebuyers is entitled to any relief, denies the remaining allegations in paragraph 7, and avers that the WBH marks are incontestable, valid, and enforceable. PARTIES 8. WBH admits the allegations in paragraph 8. 9. WBH admits that it is a Texas corporation with its principal place of business at 2140 E. Southlake Blvd., Suite L-615, Southlake, Texas 76092-6516. WBH also admits that Jeremy Brandt is the founder and CEO of WBH, that Brandt is a citizen and resident of Texas, and that Brandt’s address is 2140 E. Southlake Blvd., Suite L-615, Southlake, Texas 76092- 6516. WBH denies the remaining allegations in paragraph 9. JURISDICTION AND VENUE 10. WBH admits that this court has subject matter jurisdiction over Express Homebuyers’ request for declaratory relief. WBH denies the remaining allegations in paragraph 10, including allegations that Express Homebuyers is entitled to any relief. 11. WBH admits that there is an actual and justiciable controversy between the parties. WBH denies the remaining allegations in paragraph 11. 12. WBH admits that it is subject to personal jurisdiction in this District. WBH denies the remaining allegations in paragraph 12. 13. WBH denies the allegations in paragraph 13. 14. WBH admits that venue is proper in this district under 28 U.S.C. § 1391. WBH denies that Express Homebuyers has been harmed by WBH’s conduct. 3 Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 4 of 34 PageID# 139 FACTS COMMON TO ALL COUNTS 15. WBH admits that Express Homebuyers is engaged in the direct house buying industry. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 15 and therefore denies them. 16. WBH is without sufficient knowledge or information to form a belief about the truth of the allegations in paragraph 16 and therefore denies them. 17. WBH admits that it provides direct house buying services by referring home owners in the United States who seek to sell their houses for cash to independent local operators that are affiliated with WBH. WBH also admits that Brandt is the founder and CEO of WBH. WBH denies the remaining allegations in paragraph 17. 18. WBH admits that it is the current owner of U.S. Trademark Registration No. 3,149,336 for the trademark WE BUY HOUSES® for the goods and services described. 19. WBH denies the allegations in paragraph 19. 20. WBH denies the allegations in paragraph 20. 21. WBH admits that it is the current owner of U.S. Trademark Registration No. 3,235,523 for the service mark WEBUYHOUSES.COM® for the services described. 22. WBH admits that the parties’ controversy arises out of its enforcement of its WE BUY HOUSES® and WEBUYHOUSES.COM® marks and that those marks are at the center of this dispute. WBH denies the remaining allegations in paragraph 22 and avers that the WBH marks are incontestable, valid, and enforceable. Prosecution History of the WE BUY HOUSES Marks 23. WBH admits that United States Patent and Trademark Office (“PTO”) records include an intent-to-use application for WE BUY HOUSES filed on July 11, 2001, and that 4 Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 5 of 34 PageID# 140 application speaks for itself. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 23 and therefore denies them. 24. WBH admits that PTO records include correspondence sent on Michel Payette’s behalf dated March 5, 2002, and that correspondence speaks for itself. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 24 and therefore denies them. 25. WBH admits that PTO records include correspondence sent on Michel Payette’s behalf dated May 16, 2003, and an extension of time to file the Statement of Use dated December 10, 2003, and those documents speak for themselves. 26. WBH admits that PTO records include an application to register the WEBUYHOUSES.COM® mark filed by WeBuyHouses.com, Corp., on February 19, 2003, and that application speaks for itself. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 26 and therefore denies them. 27. WBH admits that PTO records include an Official Action dated August 14, 2003, and that document speaks for itself. 28. WBH admits that PTO records include WeBuyHouses.com, Corp.’s response to the August 14, 2003, Official Action dated February 23, 2004, and that response speaks for itself. 29. WBH admits that PTO records include a Suspension Letter dated June 29, 2004, related to WeBuyHouses.com, Corp.’s application to register the WEBUYHOUSES.COM® mark and that letter speaks for itself. 30. WBH admits that PTO records include a Record of Assignment for the WE BUY HOUSES® mark that was filed on June 14, 2004, and that record speaks for itself. WBH is 5 Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 6 of 34 PageID# 141 without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 30 and therefore denies them. 31. WBH admits the allegations in paragraph 31. 32. WBH admits the allegations in paragraph 32. 33. WBH admits the allegations in paragraph 33. 34. WBH admits that PTO records include correspondence requesting an extension of time to file the Statement of Use dated June 14, 2004, and that correspondence speaks for itself. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 34 and therefore denies them. 35. WBH admits that PTO records include correspondence dated December 2, 2005, and that correspondence speaks for itself. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 35 and therefore denies them. 36. WBH admits that PTO records include an Official Action dated January 18, 2006, and that document speaks for itself. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 36 and therefore denies them. 37. WBH admits that PTO records include correspondence dated July 20, 2006, and that correspondence speaks for itself. WBH denies the remaining allegations in paragraph 37. 38. WBH admits that PTO records include an Official Action dated August 17, 2006, and that document speaks for itself. WBH denies the remaining allegations in paragraph 38. 39. WBH admits the allegations in paragraph 39. 40. WBH admits the allegations in paragraph 40. 6 Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 7 of 34 PageID# 142 41. WBH admits the allegations in paragraph 41. 42. WBH admits the allegations in paragraph 42. WBH’S WEBUYHOUSES.COM Mark 43. WBH denies the allegations in paragraph 43. 44. WBH admits the allegations in paragraph 44. 45. WBH denies the allegations in paragraph 45. 46. WBH admits the allegations in paragraph 46. 47. WBH admits that Howard Gordon submitted a declaration and that declaration speaks for itself. WBH denies the remaining allegations in paragraph 47. 48. WBH is without sufficient knowledge or information to form a belief about the truth of the allegations in paragraph 48 and therefore denies them. 49. WBH is without sufficient knowledge or information to form a belief about the truth of the allegations in paragraph 49 and therefore denies them. 50. WBH admits that PTO records include a declaration by Howard Gordon dated June 16, 2006, and that declaration speaks for itself. WBH denies the remaining allegations in paragraph 50. 51. WBH admits that PTO records include a declaration by Howard Gordon dated October 3, 2006, and that declaration speaks for itself. WBH denies the remaining allegations in paragraph 51. 52. WBH denies the allegations in paragraph 52. Enforcement of the WE BUY HOUSES Marks 53. WBH is without sufficient knowledge or information to form a belief about the truth of the allegations in paragraph 53 and therefore denies them. 7 Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 8 of 34 PageID# 143 54. WBH is without sufficient knowledge or information to form a belief about the truth of the allegations in paragraph 54 and therefore denies them. 55. WBH denies the allegations in paragraph 55. 56. WBH is without sufficient knowledge or information to form a belief about the truth of the allegations in paragraph 56 and therefore denies them. 57. WBH admits that Brandt sent a letter dated August 14, 2017, demanding that Express Homebuyers cease any further use of “WE BUY HOUSES” and “WEBUYHOUSES.COM” in any way that would confuse consumers as to the source of WBH’s and Express Homebuyers’ respective real estate services. WBH denies the remaining allegations in paragraph 57. 58. WBH admits that the August 14, 2017, letter identified several non-infringing uses of the phrase “we buy houses.” WBH denies the remaining allegations in paragraph 58. 59. WBH denies the allegations in paragraph 59. 60. WBH admits that it attached examples of Express Homebuyers’ infringing uses of the WBH marks (or words and phrases confusingly similar to the WBH marks) to its August 14, 2017 letter. WBH denies the remaining allegations in paragraph 60. 61. WBH admits that it attached examples of Express Homebuyers’ infringing uses of the WBH marks (or words and phrases confusingly similar to the WBH marks) to its August 14, 2017 letter. WBH denies the remaining allegations in paragraph 61. 62. WBH admits that it attached examples of Express Homebuyers’ infringing uses of WBH’s marks (or words and phrases confusingly similar to the WBH marks) to its August 14, 2017 letter. WBH denies the remaining allegations in paragraph 62. 8 Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 9 of 34 PageID# 144 Infringement Allegations and Removal of Plaintiff’s YouTube Videos 63. WBH is without sufficient knowledge or information to form a belief about the truth of the allegations in paragraph 63 and therefore denies them. 64. WBH admits that it filed take-down requests with YouTube alleging infringement of the WBH marks in or about July 2016. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 64 and therefore denies them. 65. WBH is without sufficient knowledge or information to form a belief about the truth of the allegations in paragraph 65 and therefore denies them. 66. WBH denies the allegations in paragraph 66. 67. WBH admits the allegations in paragraph 67. CLAIMS FOR RELIEF COUNT ONE Declaratory Judgment as to the WE BUY HOUSES Mark 68. WBH restates and incorporates by reference the responses set forth in the paragraphs above. 69. WBH admits that there is an actual and justiciable controversy between the parties. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 69 and therefore denies them. 70. WBH admits the allegations in paragraph 70. 71. WBH admits that its WE BUY HOUSES® registration is for certain goods. WBH denies the remaining allegations in paragraph 71. 72. WBH denies the allegations in paragraph 72. 9 Case 1:17-cv-00736-TSE-IDD Document 22 Filed 10/03/17 Page 10 of 34 PageID# 145 73. WBH admits that the phrase “we buy houses” can be used in ways that do not infringe the WBH marks. WBH denies the remaining allegations in paragraph 73. 74. WBH denies the allegations in paragraph 74. 75. WBH denies the allegations in paragraph 75. 76. WBH denies the allegations in paragraph 76. 77. WBH denies the allegations in paragraph 77. 78. WBH denies the allegations in paragraph 78. COUNT TWO Declaratory Judgment as to the WEBUYHOUSES.COM Mark 79. WBH restates and incorporates by reference the responses set forth in the paragraphs above. 80. WBH admits that its WEBUYHOUSES.COM® registration is for certain goods. WBH denies the remaining allegations in paragraph 80. 81. WBH is without sufficient knowledge or information to form a belief about the truth of the allegations in paragraph 81 and therefore denies them. 82. WBH admits that there is an actual and justiciable controversy between the parties. WBH is without sufficient knowledge or information to form a belief about the truth of the remaining allegations in paragraph 82 and therefore denies them. 83. WBH admits the allegations in paragraph 83. 84. WBH denies the allegations in paragraph 84. 85. WBH denies the allegations in paragraph 85. 86. WBH denies the allegations in paragraph 86. 87. WBH denies the allegations in paragraph 87. 88. WBH denies the allegations in paragraph 88. 10