Paleteria La Michoacana, Inc. v. Productos Lacteos Tocumbo S.A. De C.V. (188 F. Supp. 3d 22, 2016)

FINDINGS OF FACT AND CONCLUSIONS OF LAW

RUDOLPH CONTRERAS, United States District Judge

This long-running dispute between Plaintiffs/Counter-Defendants Paleteria La Michoacana, Inc, and Paleteria La Michoa-cana (Sub), Inc. (collectively;, and together with their predecessors in interest, “PLM”) and Defendant/Counter-Claimant Productos Lácteos Toeumbo S.A. De C.V, (“PROLACTO”) involves the right to use various registered and unregistered trademarks when selling ice cream and various other frozen treats in the United States. PLM brought this action against PRO-LACTO under the Lanham Act, 15 U,S.C.. §§ 1051 et seq,, challenging a decision by the Trademark Trial and Appeal Board (the “TTAB”) to cancel the federal registration of one of PLM’s asserted trademarks and seeking other relief on various infringement-related theories. See Second. Am. Compl., ECF No. 40. PROLACTO, in turn, filed a variety of counterclaims against PLM alleging, among other things, trademark infringement and false advertising. See Ans. 2d Am. Compl. & Countered., ECF No. 41. At the summary judgment stage, the Court resolved a number of the parties’ claims and narrowed some of the issues for trial.

The Court conducted a bench trial over the course of thirteen days between September 14, 2015 and October 1, 2015. Following the trial, the parties submitted proposed findings of fact and conclusions of law, as well as subsequent briefs in opposition. The Court now makes its Findings of Fact and Conclusions of Law, as required by Rule 52(a)(1) of the Federal Rules of Civil Procedure. For the reasons discussed below, the Court will enter judgment in favor of PROLACTO as to Count I of PLM’s Second Amended Complaint, enter judgment in favor of PLM as to Counts II and III of the Second Amended Complaint and as to PROLACTO’s Counterclaim Count, II., The Court will also dismiss Count IV of the Second Amended Complaint as moot.

I. BACKGROUND

For clarity in following the Court’s specific findings of fact and conclusions of law, the Court'first provides a brief overview of the facts underlying this case and a summary of the case’s procedural history and current posture.

A. Factual Overview

PLM and PROLACTO are in the business of manufacturing and selling “pale-tas,” a style of ice cream bars and popsi-cles that originated in Mexico and are traditionally made from fruit, spices and nuts and sold to the public in trucks and retail stores, as well as other frozen treats.

PROLACTO is a Mexican company founded in 1992. The Andrade Malfavon family, which founded and owns the company, traces its history in the paleta business to the purported origin of the paleta and the ice cream stores that make and sell them, called “paleterias,” in Toeumbo, .a city in the Mexican state of Michoacán, in the 1940s. PROLACTO primarily -does business in the United States through licensing agreements with various members of the Andrade Malfavon family who own and operate individual paleterias in certain markets, namely, Florida, Texas, Northern California, and North Carolina. Until relatively recently, PROLACTO did not directly own any paleterias in the United States or otherwise directly sell its products to any consumers in the United States.

PLM traces its history to at least as early as 1991, when two brothers, Mexican immigrants Ignacio Gutierrez and Ruben Gutierrez, began selling paletas out of pushcarts in Northern California using the name “La Michoacana,” which literally means, in Spanish, “the woman from the state of Michoacán.” The partnership dissolved in 1999, and Ignacio Gutierrez operated the business as a sole proprietorship for several years before incorporating in California. PLM’s business has grown significantly since its beginnings as a pushcart operation in Northern California. PLM currently manufactures its products in a factory in Modesto, California and distributes its products throughout various parts of the United States where they are sold at large-scale retailers such as Costco, Wal-Mart, arid Walgreens, as well as Hispanic grocery stores such as El Super and Vallaría and a variety of other retail outlets.

Both PLM and PROLACTO use a variety of trademarks when selling their products in the United States. A graphic displaying some of the marks the parties have used appears below:

The battle between the PLM and PRO-LACTO over the right to use these marks has been fierce and protracted. The parties sharply dispute, among many other things, which of them first used these marks in the United States, and each party accuses the other of engaging in bad faith in a variety of different ways.

B. Procedural History

The procedural history of this case stretches back nearly a decade. An understanding of this history is necessary to resolve the issues before the Court.

1. TTAB Proceedings

After unsuccessfully attempting to register certain marks with the United States Patent and Trademark Office (the “USP-TO”), on April 27, 2007, pursuant to the Lanham Act, PROLACTO filed a petition with the TTAB, a body of the USPTO, to cancel PLM’s Registration No. 3,210,304 for the mark titled “LA INDITA MI-CHOACANA,” shown above, for use on ice cream and fruit products. See Pet. Cancellation, TTAB Dkt. I. The cancellation proceeding remained pending for several years, and, as part of the discovery process, the parties took oral and written deposition testimony from a number of witnesses between 2009 and 2010.

On May 20, 2011 the TTAB granted PROLACTO’s petition for cancellation of PLM’s LA INDITA MICHOACANA mark. See generally Productos Lacteos Tocumbo S.A. De C.V. v. Paleteria La Michoacana, Inc., 98 U.S.P.Q.2d 1921, 2011 WL 2161071 (T.T.A.B. May 20, 2011) (“TTAB' Decision”). The TTAB concluded that the mark should be cancelled because PROLACTO had established priority of use and likelihood of confusion with respect to several of its asserted, unregistered marks, including its own Indian Girl design, as well as its LA MICHOACANA (words only), LA MICHOACANA NATURAL (words only), and LA MICHOACA-NA NATURAL marks. See id. at **9-16.

Following the TTAB’s decision, PLM moved for reconsideration, arguing that PROLACTO failed to establish priority of use and that the TTAB erred in concluding that PROLACTO established common law rights in its “Michoacana” marks. See Mot. Recons., TTAB Dkt. 109. The TTAB issued a decision denying reconsideration on July 13,2011. See TTAB Dkt. 115.

2. The Present Action

PLM commenced this action pursuant to 15 U.S.C.* § 1071(b) on September 8, 2011. See Compl., ECF No. 1.

a. PLM’s Second Amended Complaint and PROLACTO’s Counterclaims

PLM’s Second Amended Complaint alleges four causes of action: Count I seeks reversal of the TTAB’s decision to cancel the registration of PLM’s LA INDITA MICHOACANA mark and denial of PRO-LACTO’s cancellation petition; Count II seeks a declaration that there is no likelihood of confusion between PLM’s LA IN-DITA MICHOACANA mark and various marks asserted by PROLACTO on the basis of their common usage of the word “MICHOACANA”; Count III alleges that PROLACTO’s use of its Indian Girl mark infringes three of PLM’s registered marks under 15 U.S.C. § 1114, including its LA INDITA MICHOACANA mark; and Count IV seeks to cancel PROLACTO’s registration of certain marks containing the name LA FLOR DE MICHOACAN if a likelihood of confusion is found between those marks and PLM’s marks. See Second Am. Compl. at 13-16.

PROLACTO, in turn, filed seven counterclaims: Counterclaim Count I alleges that PLM infringed its registered LA FLOR DE MICHOACAN and design mark under 15 U.S.C. § 1114(1); Counterclaim Count II alleges trademark infringement, unfair competition, passing off, false advertising, false association, and false designation in violation of 15 U.S.C. § 1125(a); Counterclaim Count III alleges trademark infringement of the District of Columbia’s common law; Counterclaim Count IV alleges trademark dilution under 15 U.S.C. § 1125(c); and Counterclaim Counts V, VI, and VII seek cancellation of two of PLM’s registered marks due to fraud and abandonment. See Ans. 2d Am. Compl. & Countercls. at 29-43.

b. Summary Judgment

After the close of discovery in this case, the parties filed cross-motions, for partial summary judgment, each of which the Court granted in part and denied in part. See generally Paleteria La Michoacana, Inc. v. Productos Ladeos Tocumbo S.A. De C.V., 69 F.Supp.3d 175 (D.D.C.2014) (“PLM I”). The Court subsequently granted in part and denied in part a motion by PLM to revise the Court’s Memorandum Opinion and Order at summary judgment and denied a motion for consideration by PROLACTO, issuing a First Revised Order on February 3, 2015. See First Revised Order, ECF No. 175; Paleteria La Michoacana, Inc. v. Productos Lacteos Tocumbo S.A. De C.V., 79 F.Supp.3d 60 (D.D.G.2015) (“PLM II”) (denying PRO-LACTO’s motion for reconsideration); Mem. & Order, ECF No. 174 (“PLMIII”) (granting in part and denying in part PLM’s motion to revise the Court’s summary judgment Memorandum Opinion and Order).

A brief summary of the disposition of each count of PLM’s Second Amended Complaint and PROLACTO’s Countér-claims is necessary to understanding the issues presented at trial for the Court’s determination:

• Complaint Count I: The Court denied summary judgment to both parties after concluding that new evidence presented by PLM created a genuine dispute of material fact as to whether the “tacking” doctrine is applicable in order to establish priority of use for its LA INDITA MICHOACANA mark. See First Revised Order ¶ 10; PLM I, 69 F.Supp.3d at 192-96.

• Complaint Count IP. The parties did not seek summary judgment.

• Complaint Count III: The parties did not seek summary judgment.

• Complaint Count IV: The parties did not seek summary judgment.

• Counterclaim Count I: The Court entered judgment in favor of PLM, affirming the TTAB’s conclusion that PLM did not infringe LA FLOR DE MICHOACAN and design mark. See First Revised Order ¶ 1; PLM I, 69 F.Supp,3d at 196-200.

• Counterclaim Count II: Trademark Infringement, False Designation of Origin, Passing Off, and Unfair Competition: The Court entered partial judgment in favor of PLM limiting this claim to the Houston, Texas market and denied summary judgment to both parties as to whether PROLACTO has established secondary meaning for its marks after finding the existence of a genuine dispute of material fact. See First Revised Order ¶¶2, 11; PLM /, 69 F.Supp,3d at 209-12; PLM III at 5-12.

• Counterclaim Count II: False Advertising: The Court entered judgment in favor of PROLACTO as to the elements of falsity, deceptiveness, and interstate commerce after finding that PLM conceded the issues. See First Revised Order ¶ 3; PLM I, 69 F.Supp.3d at 216. The Court denied summary judgment to both parties as to the elements of materiality and injury after finding that a genuine dispute of material fact existed. See First Revised Order ¶ 13; PLM I, 69 F.Supp.3d at ,216-19. The Court entered judgment in favor of PLM as to all markets with regard to its use of “LA- MICHOACANA ES NATURAL” and “PALETERIA MI-CHOACANA” on . the basis that PROLACTO did not plead those marks. See First Revised Order ¶ 3; PLM III at 8-11. The Court entered judgment in favor of PLM as to the Sonoma, California market with regard to its use of “LA INDI-TA MICHOACANA” and Indian Girl designs on the basis that PLM established priority in that market. See First Revised Order ¶ 3; PLM III at 11-12. The Court denied summary judgment to PLM as to its arguments that laches prevents PROLACTO from bringing its claim and that PROLACTO lacks prudential standing. See First Revised Order ¶ 12; PLM I, 69 F.Supp.3d at 213-16. The Court also dismissed one particular alleged false advertisement as moot after finding that PLM no longer used the advertisement. See PLM I, 69 F.Supp.3d at 213 n. 13.

• Counterclaim Count III: The Court entered judgment in favor of PLM on the basis that PROLACTO provided no evidence that it used or planned to use the marks at issue in the District of Columbia. See First Revised Order ¶ 4; PLM I, 69 F.Supp.3d at 219.

• Counterclaim Count IV: The Court entered judgment in favor of PLM after concluding that PROLACTO’s marks had not achieved the level of fame necessary for a trademark dilution claim; See First Revised Order ¶ 5; PLM I, 69 F.Supp.3d at 219-22.

• Counterclaim Count V: The Court entered judgment in favor of PLM after finding that PROLACTO failed to establish fraud. See First Revised Order ¶ 6; PLM I, 69 F.Supp.3d at 222-26.

• Counterclaim Count VI: The Court entered judgment in favor of PLM after finding that PROLACTO failed to establish fraud. See First Revised Order ¶ 6; PLM I, 69 F.Supp.3d at 222-26.

• Counterclaim Count VII: The Court entered judgment in favor of PLM after PROLACTO conceded that summary judgment was appropriate. See First Revised Order ¶8; PLM I, 69 F.Supp.3d at 223.

In addition, the Court entered judgment in favor of PLM as to'the issue of whether PROLACTO is entitled to any form, of monetary relief on any of its counterclaims after finding that PROLACTO conceded the issue. See First Revised Order ¶9; PLM I, 69 F,Supp.3d at 227-28; PLM II, 79 F.Supp.3d at 71-82. '

c. Bench Trial

The Court conducted a bench trial over the course of thirteen days between September 14, 2015 and October 1, 2015. See Trial Tr. Day 1 A.M. Session (Sept. 14, 2015) (“Day 1 A.M.”), ECF No. 256; Trial Tr. Day 1 P.M. Session (Sept. 14, 2015) (“Day 1 P.M ”), ECF No. 321; Trial Tr. Day 2 A.M. Session (Sept. 15, 2015) (“Day 2 A.M.”), ECF No. 257; Trial Tr. Day 2 P.M. Session (Sept. 15, 2015) (“Day 2 P.M.”), ECF No. 322; Trial Tr. Day 3 A.M. Session (Sept. 16, 2015) (“Day 3 A.M.”), ECF No. 262; Trial Tr. Day 3 P.M. Session (Sept. 16, 2015) (“Day 3 P.M”), ECF No. 323; Trial Tr. Day 4 A.M. Session (Sept. 17, 2015) (“Day 4 A.M.”), ECF No. 266; Trial Tr. Day 4 P.M. Session (Sept. 17, 2015) (“Day 4 P.M”), ECF No. 324; Trial Tr. Day 5 A.M. Session (Sept. 18, 2015) (“Day 5 A.M.”), ECF No. 325; Trial Tr. Day 5 P.M. Session (Sept. 18, 2015) (“Day 5 P.M”), ECF No. 270; Trial Tr. Day 6 AM. Session (Sept. 21, 2015) (“Day 6 A.M.”), ECF No. 275; Trial Tr. Day 6 P.M. Session (Sept. 21, 2015) (“Day 6 P.M.”), ECF No. 278; Trial Tr. Day 7 A.M. Session (Sept. 22, 2015) (“Day 7 A.M.”), ECF No. 280; Trial Tr. Day 7 P.M. Session (Sept. 22, 2015) (“Day 7 P.M”), ECF No. 285; Trial Tr. Day 8 A.M. Session (Sept. 23, 2015) (“Day 8 A.M.”), ECF No. 284; Trial Tr. Day 8 P.M. Session (Sept. 23, 2015) (“Day 8 P.M.”), ECF No. 319; Trial Tr. Day 9 A.M. Session (Sept. 25, 2015) (“Day 9 A.M.”), ECF No. 289; Trial Tr. Day 9 P.M. Session (Sept. 25, 2015) (“Day 9 P.M.”), ECF No. 230; Trial Tr. Day 10 A.M. Session (Sept. 28, 2015) (“Day 10 A.M.”), ECF No. 291; Trial Tr. Day 10 P.M. Session (Sept. 28, 2015) (“Day 10 P.M.”), ECF No. 326; Trial Tr. Day 11 A.M. Session (Sept. 29, 2015) (“Day 11 A.M.”), ECF No. 292; Trial Tr. Day 11 P.M. Session (Sept. 29, 2015) (“Day 11 P.M”), ECF No. 327; Trial Tr. Day 12 A.M. Session (Sept. 30, 2015) (“Day 12 A.M.”), ECF No. 293; Trial Tr. Day 12 P.M. Session (Sept. 30, 2015) (“Day 12 P.M”), ECF No. 328; Trial Tr. Day 13 (Oct. 1, 2015) (“Day 13”), ECF No. 329.

PLM presented six witnesses over the course of seven days: Ignacio Gutierrez, the co-founder of PLM’s business; Patricia Gutierrez, the Chief Operating Officer of Paleteria La Michoacana (Sub), Inc.; two private investigators, Zachary Fechheimer and Patti James; George Reis, an expert in the field of image forensics; and Samuel Quinones, a journalist who has written on the subject of páleterias. PLM introduced a substantial volume of exhibits and designated significant deposition testimony for consideration.

PROLACTO presented eleven witnesses over the course of five days: Ruben Gutierrez, who co-founded PLM’s business with his brother, Ignacio Gutierrez, and left PLM in 1999; Marco Antonio Andrade Malfavon, a partner of PROLACTO; four U.S. licensees or employees of U.S. licensees, Mary Fernandez, Teresita Fernandez, Miguel Chavez Bermudez, and Cesar Gonzales Perez; Jorge Leon Baz, PRO-LACTO’s outside Mexican counsel; Dr. Jacob Jacoby, an expert who conducted a market research study; and three individuals who claimed to have either purchased or consumed PLM’s products, Felipe de Jesus Martinez, Lorena Salazar, and Ramon Salazar. PROLACTO introduced a substantial volume of exhibits and designated significant deposition testimony for consideration. During trial, the Court also took under advisement issues relating to the admissibility of numerous exhibits proffered by both parties.

Following the close of trial, each party submitted their proposed findings of fact and conclusions of- law to the Court. See Pls.’ [Proposed] Findings of Fact & Conclusions of Law (“Pls.’ Br.”), ECF No. 309; Def.’s Proposed Findings of Fact & Conclusions of Law (“Def.’s Br.”), ECF No. 311. Each party also submitted an opposition brief. See Pls.’ Opp’n & Obj. Def.’s Proposed Findings of Fact & Conclusions of Law (“Pls.’ Opp’n”), ECF No. 314; PROLACTO’s Reply & Opp’n Pis.’ [Proposed] Findings of Fact & Conclusions of Law (“Def.’s Opp’n”), ECF No. 315.

d. Other Pending Motions

In addition to the -factual and legal issues presented to the Court , during trial, several other motions filed during the course of trial or post-trial remain pending.

PROLACTO filed a motion for involuntary dismissal of PLM’s claims under Rule 52(c) of the Federal Rules of Civil Procedure at the close of PLM’s case-in-chief. See Def.’s Mot. & Mem. Involuntary Dismissal & Recons. Interlocutory Order, ECF No. 283. Pursuant to Rule 52(c), the Court declined to render any judgment until the close of all the evidence. See Day 9 A.M. at 4:13-5:3. Because the Court now finds for PLM on some of its claims after the close of all the evidence, PROLACTO’s motion for involuntary dismissal will be denied as moot. PROLACTO also filed a separate motion to exclude evidence and to seek spoliation sanctions. See Def.’s Mot. & Mem. Exclusion & Spoliation Sanctions, ECF No. 290. For numerous reasons explained below, the Court will deny that motion. Finally, in response to certain post-trial arguments made by PLM in its proposed findings of fact and conclusions of law, PROLACTO filed a motion seeking leave to file additional deposition designations. See Def.’s Mot. Seeking Leave File Add’l Deposition Designations, ECF No. 316. The Court discusses the significance of the parties’ designated deposition testimony in its findings of fact, and, for the reasons stated below, will deny PROLAC-TO’s motion as moot.

PLM, for its part, filed four motions asking the Court to take judicial notice of certain facts. See Pls.’ Request Judicial Notice, ECF No. 248; Pls.’ Request Judicial Notice No. 2, ECF No. 263; Pls.’ Request Judicial Notice No. 3, ECF No. 277; Pls.’ Request Judicial Notice No. 4, ECF No. 282. The Court addresses these pending motions, as well as admissibility issues relating to certain evidence taken under advisement during the trial, throughout its findings of fact to the extent that the Court has found the issues relevant. To the extent those issues are not relevant to the Court’s analysis, they will be denied as moot.

II. LEGAL STANDARDS

The Court first sets forth the requirements of the Federal Rules of Civil Procedure governing the Court’s findings of fact and conclusions of law and then addresses the standard that the Court uses in' reviewing the TTAB’s decision in this case.

A. Rule 52(a) of the Federal Rules of Civil Procedure

Pursuant to Rule 52(a) of the Federal Rules of Civil Procedure, in an action tried without a jury, the Court “must find the facts specially and state its conclusions of law separately.” Fed. R. Civ. P. 52(a)(1). The Court’s “[fjindings and conclusions may be incorporated in any opinion or memorandum of decision the court may file.” Defs. of Wildlife, Inc. v. Endangered Species Sci. Auth., 659 F.2d 168, 176 (D.C.Cir.1981); see also Fed. R. Civ. P. 52(a)(1) (“The findings and conclusions .,. may appear in an opinion or memorandum of decision filed by the court.”).

The Court’s findings must be “sufficient to indicate the factual basis for the ultimate conclusion.” Kelley v. Everglades Drainage Dist., 319 U.S. 415, 422, 63 S.Ct. 1141, 87 L.Ed. 1485 (1943); see also Lyles v. United States, 759 F.2d 941, 943-44 (D.C.Cir.1985) (“One of [the rule’s] chief purposes is to aid the appellate court by affording it a clear understanding of the ground or basis of the decision of the trial court,” (internal quotation omitted)). “But the judge need only make brief, definite, pertinent findings and. conclusions upon the contested matters; there is no necessity for over-elaboration of detail or particularization of facts.” Fed. R. Civ. P. 52(a) advisory committee note to 1946 amendment; accord Caffey v. Togo, No. 97-5092, 1998 WL 230269, at *2 (D.C.Cir. Feb. 9, 1998); Wise v. United States, 145F.Supp.3d 53, 57, 2015 WL 7274026, at *2 (D.D.C. Nov. 17, 2015); Moore v. Hartman, 102 F.Supp.3d 35, 65 (D.D.C.2015).

The Court is neither “require[d]” nor “encourage[d]” “to assert the negative of each rejected contention as well as the affirmative, of those which they find to be correct.” Schilling v. Schwitzer-Cummins Co., 142 F.2d 82, 84 (D.C.Cir.1944); see also Huff v. City of Burbank, 632 F.3d 539, 543 (9th Cir.2011) (“It is ...' not ‘necessary that the trial court make findings asserting thé negative of each issue of fact raised.’ ” (quoting Carr v. Yokohama Specie Bank, Ltd., of S.F., 200 F.2d 251, 255 (9th Cir.1952), rev’d on other grounds, 565 U.S. 469, 132 S.Ct. 987, 181 L.Ed.2d 966 (2012))). Similarly, “the court need not ‘address every factual contention and argumentative detail raised by the parties,’ or ‘discuss all evidence presented at trial.’” Moore, 102 F.Supp.3d at 65 (quoting Mayaguez v. Corporacion Para el Desarrollo del Oeste, 824 F.Supp.2d 289, 295 (D.P.R.2011); Wachovia Bank N.A., Nat. Ass’n v. Tien, 598 Fed.Appx. 613, 617-18 (11th Cir.2014)); see also Wise, 145 F.Supp.3d at 57, 2015 WL 7274026, at *2 (“[T]he Court need not address all the evidence presented, at trial, and must simply make findings sufficient to allow the. appellate court to conduct a meaningful review.”); Fasolino Foods Co. v. Banca Nazionale del Lavoro, 961 F.2d 1052, 1058 (2d Cir.1992) (“All that is required by Rule 52(a) is that the trial court provide findings that are adequate to allow a clear understanding of its ruling.”); 9C Charles Alan Wright & Arthur R. Miller, Federal Practice & Procedure § 2579 (3d ed. 2008).

In accordance with these standards, the Court has cited portions of the record, including trial testimony, trial exhibits, designated deposition testimony, and the TTAB record, to support its • findings of fact. The Court has not, however, exhaustively identified every portion of the record upon which it has relied to make its findings of fact, and the omission of a citation to a particular portion of the record does not necessarily mean that the Court did not rely on that portion to make its findings of fact. Rather, the Court has considered the record in its entirety, including the Court’s own determination of witnesses’ credibility, and its citations to portions of the record are simply intended to provide a helpful reference for the basis of its findings.

Finally, the Court notes that Rule 52 provides that the Court’s “[f|indings of fact, whether based on oral or other evidence, must not be set aside unless clearly erroneous, and the reviewing court must give due regard to the trial court’s opportunity to judge the witnesses’ credibility.” Fed. R. Civ. P. 52(a)(6); see also Anderson v. City of Bessemer City, N.C., 470 U.S. 564, 573-76,105 S.Ct. 1504, 84 L.Ed.2d 518 (1985) (discussing the “clearly erroneous” standard).,

B. Standard for Reviewing the TTAB’s Decision

PLM seeks reversal of the TTAB’s decision to cancel the registration of its trademark in Complaint Count I. The other pending claims and counterclaims in this action were' not presented to the TTAB, Nevertheless, because there is some overlap in the factual issues underlying Complaint Count I arid the other claims and counterclaims in this action, and given recent developments in the legal landscape, it is helpful for the Court to clarify upfront that the standard by which it reviews the TTAB’s factual findings and makes its own findings of fact in this case is de novo.

First, an understanding of the statutory framework for this action is necessary. The Lanham Act offers a party to a cancellation proceeding before the TTAB who is “dissatisfied” with the TTAB’s decision two optioris. See 15 U.S.C. § 1071. The party may either: (1) appeal the TTAB’s decision directly to the United States Court of Appeals for the Federal Circuit pursuant to § 1071(a); or (2) commence a civil action in a United States District Court pursuant to § 1071(b). See id. Here, PLM chose the latter option, filing this action against PROLACTO pursuant to § 1071(b). In a § 1071(b) action, the district court is empowered to “adjudge that an applicant is entitled to a registration upon the application involved, that a registration involved should be cancelled, or such other matter as the issues in the proceeding require, as the facts in the case may appear.” 15 U.S.C. § 1071(b)(1).

Proceedings under § 1071(a) and § 1071(b) “differ in important ways.” Aktieselskabet AF 21. Nov. 2001 v. Fame Jeans, Inc., 525 F.3d 8, 13 (D.C.Cir.2008). For example, unlike a § 1071(a) proceeding, in a § 1071(b) proceeding, the court is not always required to review the TTAB’s record. Rather, the statute only requires that the record “be admitted on motion of any party, upon such terms and conditions as to costs, expenses, and the further cross-examination of the witnesses as the court imposes, without prejudice to the right of any party to take further testimony.” 15 U.S.C. § 1071(b)(3); see also Ak-tieselskabet, 525 F.3d at 13. Once admitted, the record “shall have the same effect as if originally taken and produced in the suit.” 15 U.S-.C. § 1071(b)(3); see also Aktiesel-skabet, 525 F.3d at 13. And, importantly, the parties in § 1071(b) action may raise new claims, present new evidence, and seek additional relief beyond that which was before the TTAB. See Aktieselskabet, 525 F.3d at 13 (holding that the district court “may consider both new issues and new evidence that were not before the TTAB”). Here, both parties have asserted a variety of new claims and introduced substantial evidence, in the form of both witness testimony and documentary evidence, that was not before the TTAB.

. In determining the proper standard of review in this case, the Court looks to recent Supreme Court precedent. In 2012, the Supreme Court held in Kappos v. Hyatt, 566 U.S. 431, 132 S.Ct. 1690, 182 L.Ed.2d 704 (2012), that when an applicant for a patent seeks review of a decision of the USPTO in a district court pursuant to 35 U.S.C. § 145 and “new evidence is presented on a disputed question of fact, the district court must make de novo factual findings that take account of both the new evidence and the administrative record before the PTO.” Kappos, 132 S.Ct. at 1701. The Court explained:

The district court must assess the credibility of new witnesses and other evidence, determine how the new evidence comports with the existing administrative record, and decide what weight the new evidence deserves. As a logical matter, the district court can only make these determinations de novo because it is the first tribunal to hear the evidence in question.

Id. at 1700. The Court agreed with the Federal Circuit’s decision below that “the district court may, in its discretion, ‘consider the proceedings before and findings of the Patent Office in deciding what weight to afford an applicant’s newly-admitted evidence’” but also cautioned that “[t]hough the PTO has special expertise in evaluating patent applications, the district court cannot meaningfully defer to the PTO’s factual findings if the PTO considered a different set of facts.” Id. (quoting Hyatt v. Kappos, 625 F.3d 1320, 1335 (Fed.Cir.2010)). Thus, the Court concluded: “the proper means for the district court to accord respect to decisions of the PTO is through the court’s broad discretion over the weight to be given to evidence newly adduced in the § 145 proceedings.” Id.

Although Kappos specifically concerned a federal district court’s review of a USP-TO patent decision under 35 U.S.C. § 145, its holding applies with equal force to actions challenging a TTAB trademark decision under 15 U.S.C. § 1071(b) that involve the introduction of new evidence. The Supreme Court subsequently clarified in B & B Hardware, Inc. v. Hargis Indus., Inc., — U.S. —, 135 S.Ct. 1293, 191 L.Ed.2d 222 (2015), that Kappos concerned an “analogous scheme in patent law” and that when a party challenges a trademark registration in district court under § 1071(b), “the judge resolves registration de novo.” B & B Hardware, 135 S.Ct. at 1301; see also id. at 1305 (referring to a party’s ability to “seek judicial review of a TTAB registration decision in a de novo district court action”); id, at 1306 (stating that Congress “authorized de novo challenges for those ‘dissatisfied’ with TTAB decisions” in § 1071(b)). The Court’s clarification in B & B Hardware followed the Fourth Circuit’s decision in a separate case describing Kappos as “the primary case interpreting the patent and trademark civil action statutes” and as “explicitly defining] the only situation where consideration of the TTAB decision is permitted.” Swatch AG (Swatch SA) v. Beehive Wholesale, LLC, 739 F.3d 150, 155-56 (4th Cir.2014); see also Shammas v. Focarino, 784 F.3d 219, 225 (4th Cir.2015) (citing Swatch, 739 F.3d at 155); Adams Mfg. Corp. v. Rea, Civ. No. 12-1430, 2014 WL 978116, at *7 (W.D.Pa. Mar. 12, 2014). The leading authority on trademark law has also recognized that, in light of Kappos, a district court reviews the TTAB record in a § 1071(b) proceeding de novo. 3 J. Thomas McCarthy, McCarthy on Trademarks & Unfair Competition. (“McCarthy on Trademarks”) § 21:20 (4th ed. 2016) (“[I]f review is sought in a federal district court, new evidence is permitted and both new evidence and the T.T.A.B. record are reviewed with ‘de novo’ scrutiny.”); id. § 21:22 (“[A]fter the 2012 Kappos case, the district court reviews with ‘de novo’ scrutiny.”).

Therefore, in line with the Supreme Court’s decisions in Kappos and B & B Hardware, the Court makes its findings of fact and conclusions of law de novo. As permitted by Kappos, the. Court has reviewed the entirety of the TTAB record in this case and, in its discretion, takes into account both the new evidence submitted over the course of the lengthy bench trial and the TTAB record. See Kappos, 132 S.Ct. at 1701. But because the TTAB, in many respects, considered a “different set of facts” than has been presented here, the Court finds itself largely unable to “meaningfully defer” to the TTAB’s factual findings, despite the TTAB’s expertise on trademark issues. Id. The Court recognizes that this standard of review may represent a departure from the pre-Kap-pos approach in this Circuit, as well as the Court’s own approach at the summary judgment stage of this litigation, but the Court is confident, particularly after the Supreme Court’s' clarification in B & B Hardware, that the proper standard of review is de novo. The parties appear to be in agreement with the Court on this issue as well.

III. FINDINGS OF FACT

A. Plaintiffs

1.In General

1. The plaintiffs and counter-defendants in this action, Paleteriá La Michoacana, Inc. (“PLM, Inc.”) and Paleteria La Mi-choacana (Sub) Inc. (“PLM (Sub) Inc.”), are California corporations.

2. PLM produces and sells Mexican-style ice cream, paletas, and bolis out of its current headquarters in Modesto, California. See Day 3 A.M. at 90:4-92:2. A paleta is a Mexican-style popsicle that can be either water-based or cream-based. See id. at 92:7-13. A bolis is an ice milk or water-based product similar to an American push pop that is sealed on both sides and cylindrical in shape. See id. at 90:15-18.

3. PLM’s target consumers are of Mexican origin, typically first-, second-, or third-generation immigrants to the United States from Mexico. The flavor profile of PLM’s products is designed to appeal to these target consumers, but PLM also sells its products to consumers that fall outside this target demographic. See Day 5 A.M. at 91:5-15.

4. Today, PLM sells its products to Wal-Mart, large supermarkets such as Safeway, HEB, Albertsons, and Super Value, and regional chain stores, such as Save Mart, FoodMaxx, and Lucky Stores in the Northern California area, and Vallarta Supermarkets, Northgates, and El Super in the Southern California area. See Day 5 A.M. at 92:16-93:3. PLM also sells some of its product to distributors that distribute to street vendors. See id. at 93:7-16. PLM does not generally sell its products directly to consumers, and it does not own or operate any retail location where consumers can purchase its products. PLM currently sells its products in, approximately, 30 states or more. See Day 6 A.M. at 102:21-23. ‘

2. History and Growth of PLM

5. The history of PLM can be traced to Ignacio and Ruben Gutierrez, two brothers who immigrated to California from Jalisco, Mexico and began selling shaved ice part-time out of pushcarts in the area of Tur-lock, California in 1988 or 1989. See Day 8 A.M. at 76:6-80:25; Day 8 A.M. at 37:24-40:15. The Gutierrez brothers sold shaved ice under the name “Acapulco” from approximately. 1988 to 1991. See Day 3 A.M. at 80:12-25; Day 8 A.M. at 37:24-50:19.

6. In or about October 1990, the Gutierrez brothers decided to sell paletas instead of shaved ice. In preparation, the brothers visited Guadalajara, in the state of Jalisco, Mexico to purchase paleta-making equipment, including molds, flavorings, sticks, a brine tank, and' push carts, and to learn how to make, package, and store paletas. As part of their research in Mexico, the brothers also visited numerous paleterias in order to understand the business of making and selling paletas. See Day 3 A.M. at 82:10-86:21; Day 8 A.M. at 45:17-52:14.

7. In 1991, using money they had saved from their shaved ice business, the Gutierrez brothers opened a paleta factory at 351 North Walnut Road in Turlock, California and sold the paletas that they made in this factory out of their pushcarts in the Northern California area. See Day 3 A.M. at 81:11-82:5; id. at 94:6-16; Day 8 A.M. at 48:17-50:10.

8. From 1991 to 1999, the Gutierrez brothers conducted their paleta business as a general partnership based on an oral agreement. The Gutierrez brothers executed a written partnership agreement effective January 1, 1999, a few months before the partnership dissolved. See Day 3 P.M. at 34:17-35:15; Day 8 A.M. at 62:17-63:4; R. Gutierrez Dep. Tr. (Mar. 15, 2010) at 9:22-11:11, 35:15-24, TTAB Dkt. 81.

9. In 1991, the Gutierrez brothers’ paleta business generated between $50,000 and $60,000 in sales revenue. By 1998, their business generated close to $1 million in sales. See Day 3 A.M. at 94:17-19 (sealed testimony); Day 3 P.M at 76:24-77:14; Day 5 A.M. at 85:8-13.

10. The Gutierrez brothers’ partnership operated under various fictitious names over time, including “Paleteria Micho'aca-ria,” “Paleteria La Michoacana,” and “La Michoacana,” but all variations used the word “Michoacana.” See, e.g., R. Gutierrez Dep. Tr. (June 10, 2013) at 13:1-5 (stating that the partnership conducted business under the name “Paleteria Michoacana”); id. at 15:10-16 (stating that business “probably” operated under names other than “Paleteria Michoacana” between 1991 and 1996 but that he was not sure); I. Gutierrez Dep. Tr. (Dec. 30, 2009), Reg. Ex. 30, TTAB Dkt. 69; (Affidavit of Publication for fictitious business name of “PALETERIA MICHOACANA” dated May 22, 1991); id. Reg. Ex. 37 (telephone bill dated February 17, 1993 addressed to “RUEBEN [sic] GUTIERREZ DBA LA MICHOACANA”); I. Gutierrez Dep. Tr. (Dec. 30, 2009), Reg. Ex. 36, TTAB Dkt. 71 (Purchase and Sale Agreement dated April 8, 1999 terminating the partnership known as “PALETERIA LA ■ MICHOACANA”).

11. On May 5,1993, the Gutierrez brothers sold their product wholesale to a Las Vegas, Nevada distributor. Ignacio Gutierrez recorded the sale by hand on an invoice with the name “PALETERIA MI-CHOACANA” written on the top. See Pis.’ Ex. 142 at 1; Day 3 A.M. at 111:11-114:10.

12. In - or about 1997, the Gutierrez brothers began to have disagreements with each other, which sometimes resulted in physical violence. In early 1997, as a result of these disagreements, Ruben temporarily left the business. Ignacio persuaded Ruben to return a week or two later, but the Gutierrez brothers agreed to conduct their business separately. Under this arrangement, each brother ran the business in two-week shifts so that they did not need to work together at the same time. From that point until the dissolution of the partnership, the Gutierrez brothers had very limited contact with each other. Despite this arrangement (or perhaps as a result of it), the Gutierrez brothers continued to have serious disagreements with each other. See Day 8 A.M. at 65:4-72:25.

18. In 1998, Ignacio married Patricia Gutierrez, who then immigrated to the United States in approximately February 1999. In March or April 1999, she began visiting the PLM offices to informally assist Ignacio with his work. The marriage and Patricia’s involvement in the business exacerbated problems between the Gutierrez brothers, and Ruben Gutierrez ultimately determined that it was necessary to dissolve the partnership. See Day 6 A.M. at 50:17-51:2; Day 6 P.M. at 5:10-6:8; Day 7 A.M; at 96:13-24; id. at 106:16-107:20; Day 8 A.M. at 77:17-83:12; see also Day 4 A.M. at 9:17-10:2.

14. The Gutierrez brothers terminated their partnership through a Purchase and Sale Agreement dated April 8,1999 pursuant to which Ignacio Gutierrez agreed to pay Ruben for his 50% share of the business. See Day 3 P.M. at 35:10-23; Day 8 A.M- at 83:13-84:7; I. Gutierrez Dep. Tr. (Dec. 30, 2009), Reg. Ex. 36, TTAB Dkt. 71 (Purchase and Sale Agreement dated April 8, 1999 terminating the partnership known as “PALETERIA LA MICHOACANA”).

15. After the termination of the Gutierrez brothers’ partnership, Ruben Gutierrez formed his own paleta and ice cream business called Tropicale Foods, Inc. (“Tropi-cale Foods”). Tropicale Foods primarily sells its ■ products using the trademark name “Helados Mexico.” See Day 8 P.M. at 38:13-40:3. Tropicale Foods and PLM are competitors. See Day 4 A.M. at 13:1-9.

16. Following the dissolution of the Gutierrez brothers’ partnership, Ignacio Gutierrez continued to operate the business without interruption as a sole proprietorship. See Day 3 P.M. at 35:16-36:9. At the time, the sole proprietorship primarily sold its products to independently-owned Mexican stores in the United States and the “C-store channel,” which includes gas stations with mini-marts and neighborhood convenience stores and liquor stores. See Day 5 A.M. at 91:16-92:15.

17. In approximately May or June 1999, Patricia Gutierrez began formally working for the sole proprietorship in an administrative or secretarial role, which included, among other things, filing documents related to sales and distribution and ordering and distributing office supplies. See Day 5 A M., at 82:11-17; id. at 108:6-9; id. at 112:3-6; Day 6 A.M. at 50:17-51:2; Day 6 P.M. at 5:21-6:3; Day 7 A.M. at 109:11-21.

18. At the time that Patricia Gutierrez joined the business in 1999, PLM sold its products to, among others, a distributor that sold PLM’s products in the Sacramento and northern Nevada areas. See Day 5 A.M. at 93:17-94:11.

The issue of when PLM began selling its products in interstate commerce was disputed between the parties. PROLACTO argues, without providing any citation to the record, that PLM made its “first-ever interstate sale of product ... when Ignacio Gutierrez personally delivered a relatively small shipment of paletas to a customer in the State of Arizona” on February 21, 2005. Def.’s Br. at 11 ¶39. PROLACTO appears to be referencing PLM’s sale of product bearing the registered LA INDI-TA MICHOACANA mark to a customer in Arizona named Cruz Ramirez. See Day 4 P.M. at 88:7-14. That sale is discussed below. The Court is not persuaded, based on its observation of the witnesses’ testimony and trial and its review of the documentary record in this case that this was PLM’s “first-ever” interstate sale.

PROLACTO also offered testimony by Ruben Gutierrez that throughout his time as a partner in the business from 1991 to April 1999, PLM sold its products exclusively within the state of California. See Day 8 A.M. at 75:25-77:18. To the extent that his testimony conflicts with Patricia Gutierrez’s testimony, the Court found Ms. Gutierrez’s testimony to be more credible and convincing. As explained in detail below with respect to the dispute over PLM’s first use of the Indian Girl mark, the Court found Ms. Gutierrez to be more credible in her testimony than Ruben Gutierrez for a number of reasons, including the Court’s observation of the witnesses’ live testimony. With respect to this issue specifically, the Court found Ms. Gutierrez’s testimony to' be particularly credible given her specific recollection of personally processing the paperwork to obtain a license to sell PLM’s dairy products across state lines and into Nevada. See Day 5 Á.M. at 94:3-11.

19. In 2002, Ignacio Gutierrez incorporated the business in California as Palete-ria La Michoacana, Inc. See Day 3 P.M. at 54:19-25.

20. Also in 2002, the business moved from 351 North Walnut in Turlock, California to its current location at 2068 Lap-ham Drive in Modesto, California, 95354. PLM makes all of its products at the Modesto, California location. See Day 3 A.M. at 90:19-92:2; Day 5 A.M. at 84:23-85:2.

21. From 1999 and through 2006, PLM expanded its geographic distribution to other states, and, by 2005, PLM was selling its products in, at a minimum, California, Nevada, Texas, Oregon, Utah, and Colorado. See Day 6 A.M. at 101:13-23.

22. At some point in 2005, PLM began selling its products to supermarket and grocery store chains in Texas, including in the areas of Houston and Dallas, that in turn offered PLM’s products for sale to consumers. See generally Day 6 A.M. at 101:24-102:1. For exampie, PLM began selling its product to and running advertisements in HEB, a chain operating stores in Houston and Dallas, and a Hispanic-format store operated by HEB called'Mi Tienda. See Day 4 A.M. at 25:8-26:18; Day 6 A.M. at 64:4-66:16; Pis.’ Ex. 121 at 2. PLM also began selling to Sellers Bros., a chain operating in the city of Houston and areas to the south of the city, as well as running advertisements in the chain’s weekly circular. See Day 6 A.M. at 58:16-63:12; Pls.’ Ex. 121 at 1.

23. In 2011, Ignacio Gutierrez sold 22% of his ownership interest in PLM, Inc. to the Central Valley Fund (“CVF”). As part of this transaction, Paleteria La Michoacana, LLC (“PLM, LLC”) was formed. See Day 3 P.M. at 81:6-16.

24. Between 2006 and 2012, PLM expanded its geographic distribution even further through large-scale retailers such as Wal-Mart, entering states including Washington, New Mexico, and Illinois. See Day 6 A.M. at 102:2-19.

25. In 2013, PLM, LLC was converted to Paleteria La Michoacana (Sub), Inc. (“PLM (Sub) Inc.”), which has continued to operate the business to the present day. See Day 3 P.M. at 80:24-82:4. CVF subsequently converted its equity in the company to debt. See Day 7 P.M. at-60:16-25.

26. PLM’s business grew over time, particularly following the dissolution of the Gutierrez brothers’ partnership in April 1999, in terms of its payroll, geographic distribution, revenue, and variety of products. See, e.g., Day 5. A.M. at 82:25-84:1; Pls.’ Ex. 147; Pis.’ Ex. 269.

3. PLM’s Use of “Michoacana”

27. Since 1991, PLM has continuously and consistently used “Michoacana” or “La Michoacana” as a trademark in connection with making and selling paletas, bolis, and ice cream. See Day 3 A.M. at 94:20-95:3; Day 8 P.M. at 30:21-31:6; R. Gutierrez Dep. Tr. (Mar. 15, 2010) at 35:25-37:2, 38:5-19, 53:6-9, TTAB Dkt. 81.

28. The Gutierrez brothers used “Mi-choacana” as a trademark from the beginning of their paleta business in 1991.. See Day 3 A.M. at 94:22-95:2.

29. The Gutierrez brothers adopted the marks “La Michoacana” and “Michoacana” for their business in 1991 because they had seen that name used in paleterias in Mexico. At the time that they adopted the marks, however, they did not believe that, in Mexico, the terms “La Michoacana” or “Michoacana” denoted a single source of product. The brothers adopted the marks because, at least in part, they believed that their target consumers would recognize the name.

The Court’s finding is well grounded in Ignacio and Ruben Gutierrez’s live testimony at trial. The Gutierrez brothers both testified that during their time in Mexico, including during their trip to Guadalajara in preparation for opening their business in California in 1991, they observed innu-merous paleterias that used the name “La Michoacana” or a variation on that name containing the word “Michoacana,” including “Paleteria Michoacana.” See Day 3 A.M. at 85:4-16; Day 8 A.M. at 50:24-51:4; Day 8 P.M. at 63:7-21; see also R, Gutierrez Dep. Tr. (Mar. 15, 2010) at 7:21-8:1, TTAB Dkt. 81. Ruben Gutierrez was confident that there were, in his words, “over a thousand” paleterias named “La Michoaca-na” in Mexico,'Day 8 P.M. at 63:21, and Ignacio Gutierrez similarly stated that in Guadalajara, “they’re almost on every corner,” Day 3 A.M. at 85:8-9; see also Day 4 P.M. at 50:13-14 (stating that there is one “just in every town in Mexico”). These paleterias were distinct from each other in terms of appearance. See Day 3 A.M. at 88:9-10; Day 8 P.M. at 51:7-52:9. Ignacio testified that his understanding was not that the phrase “La Michoacana” referred to a single source of product, but, rather, “everybody used it.” Day 3 A.M. 85:8-17; see also Day 4 P.M. at 50:17. Similarly, Ruben Gutierrez testified on cross-examination that he did not know whether all of the “La Michoacana” paleterias that he observed in Mexico were owned or operated by the same company. See Day 8 P.M. at 63:22-64:3. He also testified that he did not know whether PROLACTO licensed the phrase “La Michoacana” to every pal-eteria that uses the name in Mexico. See id. at 64:4-65:6. Finally, the Court notes that PROLACTO itself was not even formed in Mexico until 1992, the year after the Gutierrez brothers began doing business in California using “La Michoacana,” and no evidence has been presented to the Court suggesting that the Gutierrez brothers recognized some other entity as being the exclusive owner or user of the phrase “La Michoacana” in Mexico in 1991.

30. There is no indication that the Gutierrez brothers adopted the name in an effort to associate themselves with a prior user of the name in the United States.

31. The Gutierrez brothers used “LA MICHOACANA” on pushcarts, as shown on the design in Plaintiffs’ Exhibit 91. Ignacio Gutierrez drew this design in October or November of 1990, and it was used on pushcarts beginning in 1991. See Pis.’ Ex. 91; Day 3 A.M. at 98:12-100:15.

32. For a period of time beginning in 1991, the Gutierrez brothers packaged each paleta in a plastic wrapper printed with “La Michoacana,” as shown on the design in Plaintiffs’ Exhibit 59, which is a printer’s proof of the packaging containing handwritten changes made by Ignacio Gutierrez in February 1991. This was the first wrapper design that the Gutierrez brothers used. Pls.’ Ex. 59; Day 3 A.M. at 99:25-105:14; R. Gutierrez Dep. Tr. (June 10, 2013), Pls.’ Ex. 256, at 16:21-17:7, 18:10-19.

33. For a short period in the early 1990s, the Gutierrez brothers decided to intentionally copy a local competitor’s paleta wrapper design of a clown for use on their paleta wrappers. After the local competitor took action against the Gutierrez brothers, the Gutierrez brothers ceased using the clown design. See Day 4 P.M. at 92:10-93:23; id. at 96:5-96:14; Day 8 A.M. at 55:12-57:20.

34. At some point either shortly before or after the Gutierrez brothers briefly adopted a competitor’s clown design for their paleta wrappers in the early 1990s, the brothers created and adopted a new design for their paleta wrappers as shown in the wrapper film contained in Plaintiffs’ Exhibit 79. This design used “MICHOA-CANA” with an array of cartoon fruit and paletas wearing sunglasses in black and white. Pls.’ Ex, 79; Day 3 A.M. at 105:16-109:10.

35. In 1993, the Gutierrez brothers began providing freezers to retail establishments in order to hold and sell their products to consumers. A photograph of the first freezer, which had a decal and the name “PALETERIA MICHOACANA,” is located in Plaintiffs’ Exhibit 89. See Pis.’ Ex. 89; Day 3 A.M. at 115:22-118:4'; see also R. Gutierrez Dep. Tr. (June 10, 2013) at 19:1-24. •

36. In approximately 1994, the Gutierrez brothers modified the design of their pale-ta wrappers again, adopting the wrapper contained in Plaintiffs’ Exhibit 101 and Defendant’s Exhibit 73. This design, unlike the previous design, was in.color. It used the same array of fruit and paletas with sunglasses' and contained the name “PAL-ETERIA LA MICHOACANA,” with “LA MICHOACANA” being the focus of the design. The Gutierrez brothers continued to use this wrapper design until the dissolution of their partnership in 1999. Pis.’ Ex. 101; Def.’s Ex. 73; Day 3 A,M. at 118:21-119:20; Day 8 A.M. at 58:18-59:7.

37. Since the dissolution of the Gutierrez brothers’ partnership, PLM has continued to use “Michoacana” in various forms on its products, including in connection with the Indian Girl and LA INDITA MI-CHOACANA marks that are also at issue in this case.

4. PLM’s Use of the Indian Girl and LA INDITA MICHOACANA

a. In General'

38. PLM has used various marks containing an Indian Girl, appearing in different designs, in commerce over time,

39. PLM (Sub), Inc. is currently the owner of the three registered trademarks appearing in the chart below.

40. PLM has also used varipus marks over time that incorporate the Indian Girls that appear in each of its three registered marks (or an Indian Girl that is similar in appearance) along with the words “LA MI-CHOACANA ES NATURAL” in different variations. A sample of these marks is provided below.

b. “Indian Girl ivith Paleta” and “Indian Girl with Cone"

41. PLM, while it operated as a sole proprietorship owned by Ignacio Gutierrez, used the Indian Girl with Paleta and Indian Girl with Cone marks, pictured below, on the outside of its corrugated shipping boxes in which it shipped products from its factory in California to distributors and retail stores in California and Nevada at least as early as June 1999, when, at the latest, Patricia Gutierrez began working for the business.

The fact issue of when PLM first used the Indian Girl with Paleta and the Indian Girl with Cone marks on its shipping boxes was sharply disputed by the parties at trial through conflicting witness testimony.

Ignacio Gutierrez testified that the Gutierrez brothers’ partnership began using the Indian Girl with Paleta on the outside of the corrugated shipping boxes used for shipping and selling their fruit bars to customers in 1994. See Day 3 P.M. at 44:17-45:24; id. at 50:11-25. He stated that, beginning in 1995, the brothers began also using the Indian Girl with Cone mark on their shipping boxes for ice cream bars. See id. at 49:22-50:10. Ignacio explained that he and his brother disagreed over whether to use the Indian Girl, with Ignacio wanting to use it because it represented the name “Michoacana” and Ruben not wanting to use it because he did not want a change. See id. at 47:16-49:6. As a compromise, according to Ignacio’s testimony, they agreed to use the Indian Girl, which Ignacio said that he drew, on shipping boxes. See Day 4 P.M. at 94:3-95:10. He stated that PLM no longer had any original boxes from that time but identified photographs of more recent shipping boxes that displayed the Indian Girl with Paleta and Indian Girl with Cone marks, cropped portions of which appear below. See Day 3 A.M. at 49:7-51:9.

Ruben Gutierrez, in stark contrast, testified that the partnership never used any Indian Girl marks, including the Indian Girl with Paleta and Indian Girl with Cone marks, on its shipping boxes and that the first time that he saw a shipping box with those marks was when he saw them in the marketplace in approximately late 2004, long after he left PLM’s business in April 1999. See Day 8 A.M. at 91:7-93:5. He did not believe that the brothers had ever discussed the idea of using an Indian Girl at any time during them partnership. See Day 8 P.M. at 5:12-22.

Finally, Patricia Gutierrez testified several times over the course of three separate days that, at the time she joined Ignacio’s sole proprietorship in 1999, the business used both the Indian Girl with Paleta and the Indian Girl with Cone on its shipping boxes. She identified the same photographs as Ignacio and testified that those boxes were shipped to customers in California and Nevada. Because she was not a part of the business at the time that it operated as the Gutierrez brothers’ partnership, she had no personal knowledge of its prior use. See Day 5 A.M. at 95:3-97:19; Day 6 A.M. at 51:3-19; Day 7 A.M. at 110:2-6; Day 7 P.M. at 58:15-59:19.

Ultimately, without any documentary evidence supporting either side’s position, the Court must resolve this factual dispute by making credibility determinations. The Court found Patricia Gutierrez to be the most credible witness of the three. Based on the Court’s observation of her entire live testimony over the course of more than two-and-a-half days of trial, as well as her testimony on this particular issue, the Court found her to be clear, consistent, and sufficiently and reasonably precise in her recollections. She even returned after ■ one break to clarify, unprompted by counsel, that one particular Indian Girl design along with the words LA MICHOACANA ■ ES NATURAL, discussed below, was not used on PLM’s shipping boxes in 1999 but that it was added years later. See Day 5 P.M. at 4:15-5:20. Moreover, PROLACTO did not present any evidence to counter her testimony as to the 1999 time frame, as Ruben Gutierrez left the business in April 1999, before Patricia joined.

The Court did not find Ruben Gutierrez’s testimony on this issue, or on any of the other issues that PLM’s witnesses disputed at trial, to be particularly credible or persuasive. The Court found, based on its observation of his live testimony in court, including his demeanor, that Ruben Gutierrez was extremely emotional and, frankly, hateful towards his brother and he exhibited a high degree of bias that undercut the reliability of his testimony. It is helpful for the Court to explain just some of its observations supporting its reasoning here.

First and foremost, the Gutierrez brothers have had a very long and extremely contentious history together. Ruben testified, for example, that their disputes rose to the level of serious physical altercations. See Day 8 P.M. at 69:25-70:1 (“Well, he knocked me out once when I was cold. Two or three hours later I woke up.”). He even testified, while being extremely emotional in court, that if he had not left PLM, “someone was going to kill someone,” and, when asked whether he would have killed someone, responded, “Anything can happen in the heat of passion.” Id. at 68:11-19; see also id. at 69:18-21 (“[Arguments led to altercations, physical altercations. And you never know what will happen in one of those things. It’s in the heat of passion somebody is going to kill somebody else.”). He also became very emotional when discussing disputes that he and Ignacio had concerning their mother. See id. at 88:3-89:23. He also testified emotionally regarding prior litigation that he and Ignacio had concerning the terms of their partnership and its dissolution and claimed that Ignacio “wanted to put [his] wife and [him] in jail.” Id. at 55:6; see also id. at 55:5-56:14 (stating that he “pleaded and begged, got on [his] knees”). It is not the Court’s place to take any position on the legitimacy of Ruben Gutierrez’s opinion of his brother. The Court does, however, find that, given this long and emotional history, his testimony on key factual disputes in this case was colored by bias and not credible. .

It is also important to note that, beyond emotional issues, the Court found that Ruben Gutierrez appeared biased based on his business stake in the outcome of this trial. His business, Tropicale Foods, is a direct competitor of PLM, and Ruben stated that from 1999 through 2008, PLM was his biggest competitor. See Day 8 P.M. at 60:14-61:5. Ignacio and Ruben engaged in litigation that concerned unfair competition, and Ignacio was successful, almost putting Ruben out of business. See Day,8 A.M. at 102:18-24; Day 8 P.M. at 21:5-23. It was, in fact, Ruben who first took issue with some of PLM’s advertisements and marks that are at issue in this case, retaining a lawyer in March 2006 to send a cease-and-desist letter to PLM and to alert PROLACTO and the USPTO. See Day 8 P.M. at 12:12-19:22; Def.’s Ex. 83 (letter dated March 22, 2006). That letter referred to Tropicale Foods as being PLM’s “biggest competitor.” Def.’s Ex. 83.

Perhaps most significantly, Ruben testified that he had been in discussions with PROLACTO about licensing the very marks at issue in this case and distributing product for PROLACTO in the United States. He testified that this discussion began around 2007, see Day 8 P.M. at 70:5-71:25, the same year that PROLAC-TO commenced the cancellation proceedings before the TTAB in this case. Later, in August 2011, a month after the TTAB denied PLM’s motion for reconsideration of its decision to cancel its LA INDITA MICHOACANA mark, PROLACTO’s lead counsel in .this case and Jorge Leon, PRO-LACTO’s Mexican counsel who was also present at trial, arranged a meeting between Ruben and PROLACTO to discuss a potential licensing arrangement in Mexico City. See Pls.’ Ex 316 (August 10, 2011 email exchange); see also Day 8 P.M. at 72:1-75:1. According to Ruben, that meeting took place in September 2011, the same month that PLM filed its initial complaint in this action. See Day 8 P.M. at 75:2-76:17. For all of these reasons, and many more not described here, the Court found Ruben Gutierrez to be an unreliable witness.

Finally, the Court also notes that its finding of fact does not place great weight on Ignacio Gutierrez’s testimony, either. Based on the Court’s observation of his live testimony at trial and its consideration of his prior conduct, not to mention his own personal and business stake in the outcome of this litigation, the Court did not find Ignacio Gutierrez to be a particularly credible witness on this issue. The Court need not determine, however, precisely when PLM began using the Indian Girl designs on its shipping boxes, as, for purposes of this case, whether PLM began using the marks in June 1999 or earlier is immaterial.

42.PLM began using its Indian Girl marks because, at least in part, Ignacio Gutierrez had seen the Indian Girl mark used in paleterias in Mexico and believed that PLM’s target consumers would also recognize the mark. He did not, however, believe that, in Mexico, the mark denoted a single source of product, and there is no indication that he was aware of any prior use of the Indian Girl in the United States.

When Ignacio Gutierrez was asked on direct examination why he wanted to use an Indian Girl in connection with PLM’s product packaging, he responded by stating