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Case 1:18-cv-00140-CW-EJF Document 12 Filed 11/26/18 Page 1 of 43

Joshua M. Green (#13715)


Jennifer L. Percy (#13939)
GREEN LEGAL GROUP, P.C.
3115 E. Lion Lane, Suite 160
Salt Lake City, UT 84121
Telephone: (801) 405-7827
Facsimile: (801) 212-9888
Email: josh@ggutah.com
Email: jpercy@ggutah.com

Attorneys for Defendants

IN THE UNITED STATES DISTRICT COURT

DISTRICT OF UTAH, NORTHERN DIVISION

ONE WORLD LANTERN FESTIVAL, LLC, a


Utah limited liability company, and YOLO
ENTERPRISES, LLC, a Utah limited liability
company, ANSWER AND COUNTERCLAIM

Plaintiffs,

v. Civil No. 1:18-cv-00140-BCW

1000 LIGHTS, LLC, a Utah limited liability Judge: Brooke C. Wells


company (formerly ANDREW KENNY &
ASSOCIATES, LLC), NICHOLAS MENEDEZ,
an individual, ZACH WERTZ, an individual, and
ANDREW KENNEY, an individual,

Defendants,

v.

MICHAEL SCHAEFER, an individual and


DAVID KNIGHT, an individual,

Third-party Defendants.
Case 1:18-cv-00140-CW-EJF Document 12 Filed 11/26/18 Page 2 of 43

Defendants, 1000 Lights, LLC, Nicholas Menendez, Zach Wertz, and Andrew Kenney,

pursuant to Rules 8 and 12 of the Federal Rules of Civil Procedure, as and for their answer to the

Complaint filed in the above-captioned proceeding state as follows:

ANSWER

I. FIRST DEFENSE

The Complaint fails to state a claim, in whole or in part, upon which relief may be

granted.

II. SECOND DEFENSE

Defendant answers the separately numbered paragraphs in the Complaint, ad seriatim, as

follows:

PARTIES

1. Without knowledge, deny.

2. Without knowledge; deny.

3. Admit.

4. Admit.

5. Admit.

JURISDICTION AND VENUE

6. Admit jurisdiction, deny remainder.

7. Admit jurisdiction, deny remainder.

8. Admit jurisdiction, deny remainder.

9. Admit venue, deny remainder.

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GENERAL ALLEGATIONS

10. Admit One World engages in generic event planning activities across the United

States, some of which involve floating lanterns, deny remainder.

11. Admit One World’s events cause people to gather, deny remainder. Affirmatively

allege that Plaintiff’s activities are generic in the field of event planning.

12. Without knowledge, deny.

13. Without knowledge, deny. Affirmatively allege that Plaintiffs’ supposed

knowledge and understanding is not unique and can be easily obtained from information that is

readily available to the public.

14. Without knowledge, deny. Affirmatively allege that One World’s products and

overall customer experience are not unique to Plaintiff and similar experiences may be had at

similar events across the country.

15. Without knowledge, deny. Affirmatively allege that Knight and Schaefer’s “best

practices, policies, and procedures” were actually developed by Defendant Menendez and are

generic and substantially similar to other events being held around the U.S.

16. Without knowledge, deny.

17. Deny. Affirmatively allege that Defendant Menendez was the one that brought

the idea to Knight and Schaefer and also the one that organized, planned and executed the water

lantern festival idea.

18. Deny. Affirmatively allege that the water lantern festivals were not Knight and

Schaefer’s idea and that they did very little in the execution of the plan to create a business

around planning water lantern festival events.

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19. Without knowledge, deny. Affirmatively allege that One World’s products and

overall customer experience are not unique to them and similar experiences may be had at

similar events across the country. Affirmatively allege that the “design” of One World’s water

lantern festivals was the brainchild of Menendez and others and that Knight and Schaefer had

very little to do with how One World events were “designed.” Affirmatively allege that there

are no intellectual property protections available for an entire “experience, consisting of food

trucks, games, and entertainment, culminating in launching a…floating lantern onto a body of

water.”

20. Deny. Affirmatively allege that One World’s products and overall customer

experience are not unique and similar experiences may be had at other similar events across the

country and even if it was a one of a kind event, nothing would be protectable under the

Lanham Act or any other federal or state statute.

21. Admit Schaefer and Knight started their plans in September of 2017, deny

remainder. Affirmatively allege that Schaefer and Knight began executing a business plan and

model that was primarily Menendez’s and involved hours of research and market launch

strategies that Menendez created.

22. Admit that a mandala design is featured, deny remainder.

23. Admit the mandala is a spiritual symbol, deny remainder.

24. Without knowledge, deny. Affirmatively allege that Plaintiffs have not articulated

any specific elements that constitute protectable trade dress.

25. One World’s materials speak for themselves, deny remainder.

26. Deny. Affirmatively allege that Knight and Schaefer’s alleged “improvements”

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are clearly obvious and functional and do not merit any kind of intellectual property protection,

patent or otherwise. Further Affirmatively allege that the design of One World’s water lantern

festivals was the idea and work of Menendez, along with Schaefer and Knight, and the additions

and changes to the design were specifically completed for the purpose of increasing the

functionality of the lanterns to allow them to float more effectively.

27. Deny. Affirmatively allege that One World’s supposed trade dress as well as the

“Water Lantern Festival Mark” are generic, functional or otherwise completely lacking in

trademark value, do not constitute trademarks or trade dress, and have not been used as

trademarks. Affirmatively allege that Defendants were the first to use “Light the Water” as a

trademark in commerce and are the true owners of the “Light the Water” mark and that One

World is engaging in a scheme of false registration and reverse confusion, wherein the

Plaintiffs, as junior users of the Light the Water mark, are attempting to make it appear that

Defendants, as the senior user of the Light the Water mark, are the infringers.

28. Deny. Affirmatively allege that One World did not begin offering any goods or

services as a company until the beginning of 2018.

29. Admit that One World applied for a federal trademark registration for “Water

Lantern Festival” and that it is still pending, deny remainder. Affirmatively allege that One

World’s alleged mark is at best descriptive, but most likely generic of the goods and services

claimed in the application..

30. Deny. Affirmatively allege that One World did not even offer tickets for sale for

its events until March or April of 2018.

31. Admit. Affirmatively allege that One World’s application was filed fraudulently,

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claiming a false date of first use and was filed knowing of Defendants’ prior use of the “Light

the Water” mark.

32. Deny. Affirmatively allege that One World has been engaging in its business

activities for less than one year.

33. Without knowledge, deny. Affirmatively allege that substantially similar events

have been organized and held by other organizers.

34. Without knowledge. Affirmatively allege that the term “water lantern festival” is

generic and descriptive in that the terms describe a generic category of event, i.e. lantern

festivals, and that the general consuming public would immediately recognize the terms “water

lantern festival” collectively and separately as describing a quality, characteristic, or function of

the goods and services being provided at those events.

35. Without knowledge, deny.

36. Deny. Affirmatively allege that One World’s event was not as original as it claims

and similar events are held all over the world.

37. Without knowledge, deny.

38. Without knowledge, deny.

39. Without knowledge, deny.

40. Without knowledge, deny.

41. Deny. Affirmatively allege that Defendants were the first to use “Light the Water”

as a trademark in commerce and are the true owners of the “Light the Water” mark and that One

World is engaging in a scheme of false registration and reverse confusion, wherein the

Plaintiffs, as junior users of the Light the Water mark, are attempting to make it appear that

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Defendants, as the senior user of the Light the Water mark, are the infringers.

42. Without knowledge, deny.

43. Without knowledge, deny. Affirmatively allege that One World has not brought

suit against these copycat events because they know there is nothing protectable about its

events.

44. Without knowledge, deny.

45. Admit that One World sent a cease and desist letter, deny remainder.

Affirmatively allege that Defendants agreed to rebrand using a different name than “Light the

Water” in exchange for avoiding a costly legal battle with One World, but after substantially

complying with One World’s demands, Plaintiffs still brought the present suit.

46. Admit Plaintiff Menendez was hired by YOLO on January 30, 2017 as a

marketing intern, as to the remainder, without knowledge, deny.

47. Admit that Menendez was initially hired as a marketing intern, then after quitting

to take another job, he was hired again in August of 2017 as an event coordinator, and one of

his primary job responsibilities was to research locations for One World to hold events. Deny

remainder. Affirmatively allege that Menendez never had any contractual relationship with and

was never paid by or employed by One World.

48. The employment contract speaks for itself, deny remainder. Affirmatively allege

that any employment contract Menendez signed with YOLO terminated when he quit to take

another job in the summer of 2017. Affirmatively allege that Menendez never signed a new

contract when he was rehired to take the event coordinator position.

49. Admit that Menendez performed a few searches to find the name of one vendor,

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deny remainder. Affirmatively allege that One World made the information publicly available to

all its employees and anyone else, including Menendez, who was not its employee, and made no

effort to keep or otherwise label it as confidential or proprietary information.

50. Admit. Affirmatively allege that this was the first use of the term “Light the

Water” by any party.

51. Admit that Menendez performed a few searches to find the name of a vendor,

deny remainder. Affirmatively allege that Menendez, like everyone else at YOLO and One

World was given access to email accounts and that One World made no attempt to keep or even

label the information as confidential or proprietary.

52. Admit Defendant Menendez was one of many people responsible for researching

potential venues, deny remainder. Affirmatively allege that One World lacked any semblance of

operational controls or process and that no one logged their research of potential venues because

One World failed to enforce this alleged rule against anyone.

53. Admit Menendez researched a number of venues for water lantern events that was

not logged, deny remainder. Affirmatively allege that One World lacked any semblance of

operational controls or process and that no one logged their research of potential venues because

One World failed to enforce this alleged rule against anyone.

54. Deny. Affirmatively allege that Menendez sat in an open area with other workers,

directly across from his direct supervisor, Joey McKnight, and this “issue” was never addressed

with Menendez even once. Affirmatively allege that Menendez survived a series of layoffs and

regularly received glowing reviews on his regular performance reviews.

55. Admit.

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56. Deny. Affirmatively allege that Menendez reported directly to a company contact,

Joey McKnight and that Menendez was neither responsible for ensuring independent

contractors signed contracts nor was he trained on any process or provided with any standard

contract for Kenney to sign.

57. Deny. Affirmatively allege that Menendez was never trained for or informed he

was responsible for obtaining a signed independent contractor agreement from Kenney.

Affirmatively allege that there was absolutely no process at YOLO or One World for obtaining

signed agreements from independent contractors.

58. Deny. Affirmatively allege that Menendez was never trained for or informed he

was responsible for obtaining a signed independent contractor agreement from Kenney.

Affirmatively allege that there was absolutely no process at One World for obtaining signed

agreements from independent contractors.

59. Deny. Affirmatively allege that Menendez had not agreed to not compete and/or

not solicit and that he was not asked to sign any agreement when he was hired as an event

coordinator.

60. Admit.

61. Deny. The lanterns that Defendants purchased came in different packaging, used

thicker paper and were taller than the ones used by One World.

62. Admit Defendant 1000 Lights began using “Light the Water” as a trademark,

deny remainder. Affirmatively allege that 1000 Lights, not One World was the first to use

“Light the Water” as a trademark and that One World is engaging in a scheme of false

registration and reverse confusion, wherein the Plaintiffs, as junior users of the Light the Water

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mark, are attempting to make it appear that Defendants, as the senior user of the Light the Water

mark, are the infringers.

63. Deny. 1000 Lights first offered event tickets for sale using the “Light the Water”

trademark on July 17, 2018 and the first sale occurred on July 22, 2018.

64. Admit.

65. Admit the video was posted on Defendant’s website, deny remainder.

Affirmatively allege that the video was posted as an HTML iframe, which preserved the

original source of the video ensuring that consumers understood the video was from another

event and provided proper attribution to both One World and the author of the video.

66. Without knowledge, deny. Affirmatively allege that the Plaintiffs purchased rights

to the video and pictures solely for the purpose of bringing frivolous claims against Defendants

and that Defendants immediately took the video down after One World demanded that they do

so. Affirmatively allege that the video and pictures have no registered copyrights and are not

entitled to any further legal recourse than they have already received.

67. Admit the photos were of a One World event, deny remainder.

68. Without knowledge, deny. Affirmatively allege that the photos were Google

images that Defendants were under the impression needed no license, a practice Menendez

learned from One World’s own business practices, and as soon as it was learned they might be

violating someone’s copyright, they took the photos down.

69. Deny. Affirmatively allege that certain posts were made and once Defendants

learned that they could be confusing to consumers, they were taken down. Affirmatively allege

that Defendants realized no benefit from the alleged confusing posts.

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70. Admit. Affirmatively allege that the confusion created is due to the fact that One

World’s mark is at best descriptive of its events if not wholly generic. Affirmatively allege that

once Defendants learned that the alleged comment was made, it immediately took it down.

71. Lacking specificity, deny.

72. Deny.

73. Admit.

74. Deny. Affirmatively allege that even if the events were “carbon copies”, which

they were not, there would be nothing improper about it, that there is nothing proprietary about

the floating lantern design, that there are only so many ways to present information normally

included on an event guide, and that Plaintiffs do not have any right to prevent other organizers

from offering similar activities as they offer.

a. Deny. Affirmatively allege that the water lantern design is wholly functional,

generic and Plaintiffs do not have any proprietary rights to said design.

b. Deny. Affirmatively allege that the mandala design is a common design and

an international symbol as Plaintiffs have admitted, and this design is placed

on thousands of products, some of which are sold at Defendants’ events.

c. Deny. Affirmatively allege that Defendants’ event guide is different from One

World’s, which is itself a generic event guide with no unique or non-

functional material or works of authorship.

d. Deny. Affirmatively allege that One World has no legal right to prevent

Defendants from engaging in similar activities, such as bean bag toss and

scavenger hunts.

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75. Deny. Affirmatively allege that One World has failed to articulate specific design

elements that merit protection and therefore has not established protectable trade dress because

its overall feel and experience is generic and common to similar events across the country,

including other lantern festivals.

76. Deny. The lanterns that Defendants purchased came in different packaging, used

thicker paper and were taller than the ones used by One World. Affirmatively allege that One

World’s design is wholly generic, is readily available online from several vendors and that none

of the parties have any proprietary rights to its design.

77. Deny. Affirmatively allege that if there has been any customer confusion it has

been caused by One World’s use of the generic terms “Water Lantern Festival” coupled with its

dogged pursuit to misappropriate Defendants’ mark “Light the Water.”

78. Without knowledge, deny. Affirmatively allege that any confusion amongst

consumers is due to the generic or otherwise descriptive terms One World has chosen to use to

brand its business (“Water Lantern Festival”) as well as its dogged pursuit to misappropriate

Defendants’ mark “Light the Water”.

79. Without knowledge, deny. Affirmatively allege that any confusion amongst

consumers is due to the generic or otherwise descriptive terms One World has chosen to use to

brand its business (“Water Lantern Festival”) as well as its dogged pursuit to misappropriate

Defendants’ mark “Light the Water.”

80. Without knowledge, deny. Affirmatively allege that Schaefer and Knight have

reached out to venues that have already agreed to host events put on by Defendants in order to

create confusion and mistrust.

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81. Admit that One World sent a cease and desist letter, deny remainder.

82. Admit. Affirmatively allege that Defendants and not One World were the first to

use the term “Light the Water” in commerce and are the true owners of the “Light the Water”

mark. Further affirmatively allege that One World is engaging in a scheme of false registration

and reverse confusion, wherein the Plaintiffs, as junior users of the Light the Water mark, are

attempting to make it appear that Defendants, as the senior user of the Light the Water mark, are

the infringers.

83. Admit that Defendants chose to rebrand instead of engaging in costly, frivolous

litigation, admit that it still has a registered d/b/a/ “Light the Water” and that it still maintains the

URL www.lightthewater.com which redirects to its new site www.1000lightsfestival.com, deny

remainder. Affirmatively allege that Defendants and not One World were the first to use the term

“Light the Water” in commerce and are the true owners of the “Light the Water” mark. Further

affirmatively allege that One World is engaging in a scheme of false registration and reverse

confusion, wherein a junior user of a mark (Plaintiffs) makes it appear that the senior user

(Defendants) are the infringers.

84. Deny.

85. Admit that the press release speaks for itself, deny remainder. Affirmatively

allege that Facebook required 1000 Lights to issue the press release before it would change its

name from “Light the Water” to 1000 Lights.

86. Deny. Affirmatively allege that One World does not have exclusive rights to the

term “Water Lantern Festival” because it is at best descriptive, but more so is a generic phrase

for the goods and services it provides. Affirmatively allege further that Defendants and not One

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World were the first to use the term “Light the Water” in commerce and are the true owners of

the “Light the Water” mark. Further affirmatively allege that One World is engaging in a scheme

of false registration and reverse confusion, wherein the Plaintiffs, as junior users of the Light the

Water mark, are attempting to make it appear that Defendants, as the senior user of the Light the

Water mark, are the infringers.

First Cause of Action


(Lanham Act – 15 U.S.C. § 1125)

87. Deny. Affirmatively allege that One World has no trademarks because their

alleged trademarks either are generic or highly descriptive and not entitled to protection, or that

the mark belongs to Defendants, and as a result, they have no standing.

88. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

89. Deny. Affirmatively allege that the “Light the Water” mark is owned by

Defendants and that once Plaintiffs realized their “Water Lantern Festival” mark was generic,

they attempted to abuse their power as a larger, more established company with more resources

to create reverse confusion as a means of stealing Defendants’ trademark and associated

goodwill.

90. Deny. Affirmatively allege that if Plaintiffs suffered any damages at all, their own

actions caused the harm they now allege. Affirmatively further allege that Defendants are the

actual aggrieved parties in this litigation and are entitled to damages.

91. Deny. Affirmatively allege that Defendants and not Plaintiffs are entitled to a

preliminary and permanent injunction against Plaintiffs, as well as all other remedies available

under the Lanham Act, including, but not limited to actual damages, costs, attorney fees, profits

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derived from Plaintiffs’ infringing activities, said amounts to be trebled by virtue of Plaintiffs’

knowing and willful behavior.

Second Cause of Action


(Common Law Trademark Infringement)

92. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

93. Deny. Affirmatively allege Plaintiffs’ cause of action is duplicative and covered

under their first cause of action as the Lanham Act protects trademark owners regardless of

whether they have registered their mark or not. Affirmatively further allege that Plaintiffs’ use of

the “Light the Water” mark infringes Defendants’ common law rights in the mark.

94. Deny. Affirmatively allege that Plaintiffs have been unjustly and improperly

enriched through its wrongful use of the “Light the Water” mark and such damages to

Defendants are without adequate remedy at law unless the Court enjoins Plaintiffs from such

further behavior. Affirmatively allege that Defendants and not Plaintiffs are entitled to an award

of punitive damages as a result of Plaintiffs’ intentional and unauthorized use of the “Light the

Water” mark.

Third Cause of Action


(Trade Dress Infringement)

95. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

96. Deny. Affirmatively allege that Plaintiffs have failed to articulate specific

elements that they believe are entitled to trade dress protection and to the extent they have

identified elements to protect as trade dress, these elements are functional, generic, merely

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ornamental, not used as trademarks, and not entitled to protection.

97. Deny. Affirmatively allege that Plaintiffs’ alleged trade dress, whatever it might

be, is functional.

98. Deny. Affirmatively allege that Plaintiffs’ floating lanterns are available from

various vendors on the internet and can be purchased by any average consumer wishing to exert

a modicum of effort. Affirmatively allege further that Defendants’ lanterns use thicker paper and

are taller than One World’s lanterns and that Defendants only purchased water lanterns from

Alibaba on one occasion and they now use a different vendor.

99. Deny.

100. Deny. Affirmatively allege that any confusion that may exist has been the direct

and proximate result of Plaintiffs’ actions.

101. Deny. Affirmatively allege that Defendants are entitled to damages in an amount

to be proven at trial as well as injunctive relief prohibiting Plaintiffs from engaging in continuing

infringing activities.

Fourth Cause of Action


(Unfair Competition Act – Utah Code Ann. § 13-5a-101 et seq.)

102. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

103. Deny. Affirmatively allege that Plaintiffs actions constitute intentional business

acts and practices that are unlawful, unfair, and misleading, and have led to a material diminution

in value of Defendants’ intellectual property.

104. Deny. Affirmatively allege that Defendants are entitled to damages caused by

Plaintiff’s unfair competition, as well as costs, attorney fees, and punitive damages.

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Fifth Cause of Action


(Unfair Competition– Utah Common Law)

105. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

106. Deny. Affirmatively allege that it is Plaintiffs’ conduct and actions that have

unfairly competed with and continue to unfairly compete with Defendants.

107. Deny. Affirmatively allege that Plaintiffs have engaged in conduct unfairly

competing with Defendants and have done so knowingly, willfully, and, on information and

belief, with actual malice and in bad faith, so as to justify the assessment of increased,

exemplary, and punitive damages against it in an amount to be determined at trial.

108. Deny. Affirmatively allege that Plaintiffs’ conduct has caused Defendants

irreparable harm and other damages as outlined in its counterclaims.

109. Deny. Affirmatively allege that Plaintiffs’ conduct has caused, and unless

enjoined by this Court will continue to cause, irreparable damage, loss, and injury to Defendants

for which Defendants have no adequate remedy at law and which justify the entry of a

preliminary and permanent injunction.

Sixth Cause of Action


(Interference with Economic Relations)

110. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

111. Deny. Affirmatively further allege that Defendants and not Plaintiffs were the first

to use the term “Light the Water” in commerce and are the true owners of the “Light the Water”

mark. Further affirmatively allege that Plaintiffs are engaging in a scheme of false registration

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and reverse confusion, wherein a junior user of a mark (Plaintiffs) makes it appear that the senior

user (Defendants) are the infringers, which has interfered with Defendants prospective and actual

economic relations and has diverted sales away from Defendants.

112. Deny. Affirmatively allege that Plaintiffs have demonstrated willful, malicious, or

intentionally deceptive conduct, or conduct that manifests a knowing and reckless indifference

toward, and disregard of, the rights of the Defendants.

113. Deny. Affirmatively allege that Defendants have suffered actual and

consequential damages and other losses as outlined in its counterclaims.

Seventh Cause of Action


(Unjust Enrichment)

114. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

115. Deny. Affirmatively allege that Plaintiffs are the ones who have benefited from

their improper, unfair, and unauthorized use of Defendants’ intellectual property.

116. Deny. Affirmatively allege that Plaintiffs would be unjustly enriched if permitted

to retain the profits and other gains they have received, and continue to receive, from such

actions.

117. Deny. Affirmatively allege that Plaintiffs and not Defendants should be required

to account for and turn over to Defendants, or to be deemed to hold in a constructive trust for the

benefit of Defendants, all profits and gains derived and to be derived from the sale by One World

of any products and/or services using the “Light the Water” mark, as outlined in Defendants’

counterclaims.

Eighth Cause of Action

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(Breach of Duty of Loyalty – Against Menendez)

118. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

119. Admit.

120. Deny. Affirmatively allege that the rules of employment were actually quite lax

and that many other employees, including Menendez, often did personal projects, homework,

and took care of other personal matters during work hours in full view of their supervisor(s), who

often did the same.

121. Deny. Affirmatively allege that Menendez never took any venues that One World

would have selected based on its strict criteria for venue selection.

122. Deny. Affirmatively allege that as an hourly employee, YOLO failed to

compensate Menendez for many, many hours of work he performed for the company.

123. Deny.

Ninth Cause of Action


(Misappropriation of Confidential Information – Against Menendez)

124. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

125. Deny. Affirmatively allege that access to the alleged confidential information was

granted to all employees of One World and even non-employees, such as Menendez, that this

information was never labeled as confidential or otherwise proprietary, was not adequately

safeguarded or protected by Plaintiffs in a manner that was reasonable under the circumstances,

and that since Menendez had no employment agreement with YOLO or One World, had no duty

to hold any information he obtained in the course of his duties as confidential.

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126. Deny. Affirmatively allege that as a result of this search Menendez only learned

the name of one vendor and only used that vendor for a short period of time, but no longer uses

it.

127. Deny.

Tenth Cause of Action


(Civil Conspiracy)

128. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

129. Deny.

130. Deny.

Eleventh Cause of Action


(Copyright Infringement)

131. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

132. Without knowledge, deny.

133. Without knowledge, deny.

134. Deny. Affirmatively allege that Defendants engaged in fair use.

135. Deny. Affirmatively allege that Defendants engaged in fair use.

136. Deny.

137. Deny.

138. Deny. Affirmatively allege that Plaintiffs’ alleged copyrightable works have not

been registered and thus are not entitled to be presented in this litigation pursuant to 17 U.S.C.

411(a), which states “No civil action for infringement of the copyright in any United States work

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shall be instituted until . . . registration of the copyright claim has been made in accordance with

this title.” Plaintiff further affirmatively alleges that there are no actual damages at issue in this

matter, and statutory damages are not available to unregistered works.

139. Deny. Affirmatively allege that Defendants engaged in fair use. Affirmatively

further allege that Plaintiffs’ alleged copyrightable works have not been registered and thus are

only entitled to injunctive relief as there are no actual damages and statutory damages are not

available to unregistered works

140. Deny.

Twelfth Cause of Action


(False Advertising by Defendants in Violation
of Section 43(a)(1)(B) of the Lanham Act)

141. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

142. The statute speaks for itself, deny remainder. Affirmatively allege that Plaintiffs

have not met their prima facia case for false advertising claims under the Lanham Act because

they fail to specify and particularize their damages.

143. Deny.

144. Deny.

145. Deny.

146. Deny.

147. Deny.

148. Deny.

Thirteenth Cause of Action


(Violation by Defendants of the Utah Truth in Advertising Act’s

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Prohibition Against Deceptive Trade Practices)

149. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

150. The statute speaks for itself, deny remainder.

151. Deny.

152. Deny.

153. Deny.

154. Deny.

155. The statute speaks for itself, deny remainder.

156. Deny.

Fourteenth Cause of Action


(Breach of Contract – Against Menendez)

157. Defendants re-allege and incorporate herein, as if set forth in full, the foregoing

responses to the Complaint.

158. The contract speaks for itself, deny remainder. Affirmatively allege that said

contract terminated when Menendez quit to take another job during the summer of 2017.

Affirmatively further allege that Menendez never signed a new contract when he was hired for a

new position on or about August 2017.

159. Deny. Affirmatively allege that said contract terminated when Menendez quit to

take another job during the summer of 2017. Affirmatively further allege that Menendez never

signed a new contract when he was hired for a new position on or about August 2017.

160. The contract speaks for itself, deny remainder. Affirmatively allege that said

contract terminated when Menendez quit to take another job during the summer of 2017.

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Affirmatively further allege that Menendez never signed a new contract when he was hired for a

new position on or about August 2017.

161. Deny.

162. Deny.

163. Deny each and every allegation in Plaintiffs’ Complaint not expressly admitted

above.

III. THIRD DEFENSE

Plaintiffs’ claims should be denied, in whole or in part, because Plaintiffs allege

trademark infringement for the term “Water Lantern Festival,” a mark that is generic of the

goods and services Plaintiff provides.

III. FOURTH DEFENSE

Plaintiffs’ claims should be denied, in whole or in part, because Defendants were the first

to use the “Light the Water” mark in commerce and that they are the rightful owners of the

“Light the Water” mark and that One World is engaging in a scheme of false registration and

reverse confusion, wherein the Plaintiffs, as junior users of the Light the Water mark, are

attempting to make it appear that Defendants, as the senior user of the Light the Water mark, are

the infringers.

IV. FIFTH DEFENSE

Plaintiffs’ claims should be denied, in whole or in part, because Plaintiffs have failed to

articulate specific elements they believe merit trade dress protection and to the extent they do,

such trade dress is functional, generic, merely ornamental, not used as trademarks, or otherwise

not entitled to trademark protection under the Lanham Act or any other applicable federal or state

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law.

V. FIFTH DEFENSE

Plaintiffs’ claims should be denied, in whole or in part, because Plaintiffs’ alleged

copyrights have not been registered and therefore are not entitled to be litigated before this court,

there have been no damages of any kind, and even if the designs were registered, pursuant to the

Copyright Act Plaintiff would only be entitled to injunctive relief. Further, Defendants use of the

works constitutes fair use.

VI. SIXTH DEFENSE

Plaintiffs’ claims should be denied, in whole or in part, because prior to leaving YOLO to

take another job, YOLO committed a prior material breach of its agreement to pay Menendez by

the hour when it failed to compensate him for all the hours he worked for YOLO.

VII. SEVENTH DEFENSE

Plaintiffs’ claims should be denied, in whole or in part, because Plaintiffs fail to exhibit

clean hands in its conduct relating to the transactions complained of.

VIII. EIGHTH DEFENSE

Plaintiffs’ claims should be denied, in whole or in part, because Plaintiffs’ claims are

barred for misuse of copyright.

VIV. NINETH DEFENSE

Defendants reserve the right to assert such other and additional defenses as they may

appear to apply during this case.

WHEREFORE, Defendants pray that Plaintiffs’ Complaint be dismissed; that Plaintiffs

take nothing thereby; and that Defendants instead be awarded damages, attorney fees, and costs

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pursuant to their counterclaims below:

COUNTERCLAIM

Defendants, 1000 Lights, LLC, Nicholas Menendez, Zach Wertz, and Andrew Kenney, by

and through counsel, as and for their Counterclaim complain against Plaintiffs as follows:

PARTIES

1. One World Lantern Festival, LLC (“One World”) is a Utah limited liability

company, having its principal business office and registered agent address in Benson, Utah.

2. YOLO Enterprises, LLC (“YOLO”) is a Utah limited liability company, having

its principal business office and registered agent address in Providence, Utah.

3. 1000 Lights, LLC (“1000 Lights”) is a Utah limited liability company, having its

principal business office and registered agent address in Sandy, Utah.

4. Nicholas Menendez (“Menendez”) is a shareholder of 1000 Lights.

5. Zach Wertz (“Wertz”) is a shareholder of 1000 Lights.

6. Andrew Kenney (“Kenny”) is a shareholder of 1000 Lights.

7. Third-party Defendant Michael Schaefer is a manager of YOLO Enterprises, LLC

and One World Lantern Festival, LLC.

8. Third-party Defendant David Knight is a manager of YOLO Enterprises, LLC and

One World Lantern Festival, LLC.

JURISDICTION AND VENUE

9. Jurisdiction and venue are proper in this Court because both Plaintiffs and

Defendants, as well as both Third-party Defendants have conducted business in Northern, Utah

and this action raises issues governed by state and federal laws.

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GENERAL ALLEGATIONS

10. In February 2017, Color Vibe LLC, the former business name of what is now

known as YOLO, hired Menendez for an entry level paid internship as a regional marketing

coordinator. Menendez signed a general employment agreement with Color Vibe, LLC and

agreed to be paid $9.00 an hour. Menendez’s primary job responsibility was to promote and

grow YOLO events with minimal or no cost to the company by doing things like sending out

mass emails and giving away free tickets.

11. In May 2017, Menendez quit working for YOLO to pursue an internship with

General Mills.

12. In August 2017, YOLO reached out to Menendez and offered him the position of

event coordinator which had just been vacated by a former employee. Menendez accepted the

new position for a wage of $10.25 an hour, but he never signed a new employment agreement.

13. Menendez’s general job responsibilities as an event coordinator were to work

with other employees to produce YOLO’s various events, such as a 5k color runs.

14. In November 2017, the owners of YOLO, Michael Schafer (“Schafer”) and David

Knight (“Knight”) informed their employees that they were starting an independent and separate

company, One World Lantern Festivals to put on sky lantern festivals.

15. Menendez, along with several other YOLO employees, were instructed to attend a

sky lantern festival put on by another company and to research and document how it was done.

They were instructed to take pictures, and Menendez was specifically instructed to find a way to

get back stage during the event and take as many notes and pictures as he could.

16. Shortly thereafter, Menendez was assigned the task of finding locations to hold

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One World’s sky lantern festivals, but he had a difficult time finding feasible locations to hold

the sky lantern festivals. The market was already saturated with similar companies who had

booked the prime locations where these events could be held.

17. Menendez had seen YouTube videos of Lantern Floating Hawaii Memorial Day

water lantern festival and pitched the idea to Schafer and Knight that they should focus on water

lantern festival as opposed to sky lantern festivals.

18. One World decided to use Menendez’s idea and Schafer and Knight took content,

including photos, from Lantern Floating Hawaii’s website for One World’s website. In fact, One

World’s original website bore a striking resemblance to Lantern Floating Hawaii’s website.

19. Upon realizing that at that time they did not have a lot of competition, One World

began purchasing any online domain name that they thought could be associated with a water

lantern festival hoping to prevent any future online competition. They purchased at least four or

five online domain names.

20. In March 2018, Menendez headed up the production of One World’s first water

lantern festival in El Paso, Texas. This event and the several events Menendez organized adopted

many of the same elements Menendez, Schaefer and Knight had seen and witnessed at other

similar events in developing their business plan. He then went on to head up the production of

One World’s next several water lantern festivals. Menendez was in charge of finding the venues,

the vendors, creating the event guides, and otherwise orchestrating all of the logistics associated

with producing these events.

21. Shafter and Knight did not provide their employees with any training or insight

they had from their own professional experience. Instead, they focused on marketing the events

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and coordinating the shipping of the water lanterns from China to the United States.

22. While Menendez’s work responsibilities began to focus more and more on One

World, he continued to be paid by YOLO.

23. In March 2018, shortly after One World’s first two water lantern festivals, Schafer

told Menendez that he had received a Facebook message from Lantern Floating Hawaii asking

them to stop copying their event and if they did not, they could expect to receive a formal cease

and desist letter. Schafer was unphased by the message and informed Menendez that he had

expected such a letter, but that they would continue to produce water lantern festivals.

24. While working in the office, Menendez and the other YOLO and One World

employees who were tasked with producing the water lantern festivals were paid by the hour.

However, when they were required to travel across the country to produce events, YOLO only

paid their travel expenses and a small flat fee for their time.

25. By May 2018, as One World grew, so did the demand on the employees whose

work load and hours had doubled. The events were getting bigger and more complex and the

travel time had increased. Instead of paying the employees more to compensate them for the

additional work, YOLO reduced the flat fee by about $50.00.

26. Menendez was concerned that the quickly growing company would disintegrate if

it didn’t find a way to retain its employees. In May 2018, Menendez proposed several cost saving

procedures that would help One World save money on their expenditures, which could then be

reallocated to employee pay raises. Shafter and Knight informed Menendez that since they

hadn’t paid themselves from One World in 2017 they would not consider any pay raises for their

employees.

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27. Around this same time, Menendez’s wife became very ill and required intensive

medical treatment. Upon realizing that there was little potential for career development and

merited pay increases at YOLO, he began looking for other employment opportunities that

would provide him with compensation to meet his increased financial demands.

28. Throughout Menendez’s employment with YOLO, he recruited friends, family,

and other interested persons to help produce YOLO’s various events. These individuals were

hired as independent contractors on an event by event basis. Menendez was never advised or

otherwise made aware that he was required to have these independent contractors sign any type

of contract or agreement with YOLO or One World. In fact, Schafer and Knight knew of these

hiring arrangements and even attended several of these events and never inquired as to whether

the independent contractors had signed any type of agreement.

29. In May 2018, Kenney was retained by YOLO as an independent contractor to

help produce a 5k color run in Frederick, Maryland.

30. In June 2018, Kenney was hired by One World as an independent contractor to

help produce water lantern festivals in Lake Gregory, California and in Colorado Springs,

Colorado.

31. Kenney took several pictures of the California water lantern festival with his

personal cell phone and posted the pictures on his personal Instagram account.

32. He received lots of positive feedback about the photos, which caused Kenney to

consider starting his own water lantern festival production company. Kenny had been a student

body officer in high school, a Utah State University ambassador, and the president of the Utah

State University student business counsel while he was in college. All of these positions required

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him to take the lead in organizing and producing various events and conferences, often for

groups of 1,000 or more people.

33. Kenney began sharing his ideas with Wertz. Kenny has a degree in accounting

and Wertz is finishing up a degree in business management. Together they started looking at the

costs of producing a water lantern festival and decided that they could start their own business

and make a decent profit.

34. They began contemplating various names for their company. Considering the

numerous company names that already existed in the marketplace, they decided upon Light the

Water as a good fit. This was in part because they also believed they would be able to generate

good organic online marketing with the name. The online domain name of lightthewater.com

was available, as was the business name for purposes of registering with the state of Utah.

35. In mid-June of 2018, Kenney asked Menendez if he would be interested in

starting or joining a water lantern festival company with him and Wertz. Menendez was hesitant

to commit due to his wife’s health, and he was concerned about taking any financial risks.

36. On June 19, 2018, Kenney created a Light the Water Facebook page and

purchased the domain name www.lightthewater.com.

37. On June 20, 2018, Menendez created a Light the Water Instagram profile for

Kenney and Wertz.

38. By June 29, 2018, Kenney and Wertz had decided to start 1000 Lights, whether or

not Menendez decided to join them.

39. On July 1, 2018, Menendez gave YOLO his two-week notice of his intent to quit

working for the company, and July 12, 2018 was his last day with YOLO. At that time, he had

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still not made a firm commitment to join 1000 Lights.

40. Menendez had accepted another full-time position in the marketing department of

a company based in Logan, Utah, where he is still currently employed.

41. On July 10, 2018, Kenney and Wertz started Andrew Kenney & Associates, LLC,

doing business as Light the Water, which later amended its name to 1000 Lights, LLC.

42. On July 12, 2018, 1000 Lights published their website using the name Light the

Water with their logo that consists of a circle surrounding a sun rising over 5 lines that represent

water. The sun has 7 rays coming off the top, as depicted in the following image: ‘

43. On July 13, 2018, 1000 Lights opened a business bank account under the name

Light the Water.

44. On July 17, 2018, 1000 Lights launched their website www.lightthewater.com

that included an event page allowing customers to purchase tickets for their first three events in

Bakersfield, California, Lubbock, Texas, and Tucson, Arizona.

45. On July 24, 2018, Schafer and Knight contacted Menendez and demanded to

know if he had any association with “Light the Water” and threatened that he would be hearing

from their attorneys if he didn’t immediately shut down 1000 Lights.

46. On July 25, 2018, 1000 Lights filed their application for a Light the Water

trademark with the state of Utah.

47. On July 31, 2018, Menendez received a long and harassing text message from a

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YOLO employee calling him a “prick,” “pathetic,” and “poison.”

48. On July 31, 2018, an “Alice Aken” posted on the Light the Water Facebook page

that the company was a scam and fraud. During Menendez’s employment at YOLO, his

supervisor had informed him that Schafer had created a Facebook profile under the alter ego of

Alice Aken to rebut and otherwise manage negative online publicity.

49. Throughout the month of August, 1000 Lights received several phone calls from

venues with whom they had been working. The venues had received phone calls from Schafer

and other individuals associated with One World, claiming that 1000 Lights was being sued and

therefore the venues should be wary of working with 1000 Lights.

50. On August 14, 2018, 1000 Lights, and Menendez personally, received cease and

desist letters from One World claiming that One World had applied to trademark the phrase

Light the Water, so 1000 Lights could not use it, that Menendez was in breach of his

employment contract with YOLO, and One World otherwise demanded that they shut down

1000 Lights.

51. On August 22, 2018, through counsel, 1000 Lights responded that they weren’t in

violation of any trademark laws or employment agreements and they intended to continue to

operate 1000 Lights and use the name Light the Water. However, they did agree to make a good

faith effort to work with One World to alleviate their concerns about unfair competition, the use

of intellectual property, etc.

52. On September 6, 2018, 1000 Lights received another demand letter from One

World threatening litigation if they did not essentially cease all business activity and otherwise

shut down 1000 Lights.

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53. As a fledgling business, 1000 Lights decided that instead of fighting a contested

trademark action, it would be easier and less expensive to stop using the dba Light the Water and

rebrand to 1000 Lights. They also took down all information on their website that One World

claimed was protected by trademarks.

54. Facebook required 1000 Lights to issue a press release before it would authorize

their request to change the name. As a result, on September 21, 2018, 1000 Lights issued the

following press release:

Light the Water Changes name to “1000 Lights”

September 21, 2018 – Light the Water Lantern festival is committed to providing the
absolute best experience for all who attend the events. While there are many lantern
festivals you could choose to go to, we are glad you have chosen Light the Water.

After careful consideration, with the tremendous amount of competition in the market,
Light the Water has decided to further differentiate itself from other lantern festivals to
help eliminate customer confusion. We hope that this will help consumers know how
which event provides them with the best entertainment and experience.

Effective immediately, “Light the Water” lantern festival will be changing to “1000
Lights” lantern festival. All current tickets for light the Water events will remain valid as
well as future events.

If you have any further questions, please email support@1000lightsfestival.com or


support@lightthewater.com for more details.

55. 1000 Lights had the expectation, based on assurances from One World, that if

they rebranded they would be able to enter into good faith negotiations with One World to

resolve any other outstanding issues.

56. While Menendez’s brief experience in producing water lantern festivals for One

World was helpful, he did not provide 1000 Lights with any information that it could not readily

obtain from publicly available sources. For example, Menendez knew that One World was

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purchasing its water lanterns from a Chinese company. However, an internet search of “where to

buy water lanterns” quickly produces Alibaba along with several other retailers and online

platforms. Furthermore, 1000 Lights has decided to use another company as its primary supplier

of lanterns.

57. On September 29, 2018, 1000 Lights produced its first two events in Burbank,

California and Utah County, Utah. Schafer and Knight attended both events.

58. Schafer was on the same flight to Burbank, California, as Menendez and Wertz

and was seated directly across the aisle from them. As they were getting off the flight, Schafer

leaned over the seats so that his face was close to Menendez and told Menendez that he is “a

piece of shit” and otherwise proceeded to defame his character.

59. Upon arriving back in Salt Lake City, Utah the following day, Menendez’s former

supervisor at YOLO was waiting for him at baggage claim, and told Menendez that he is a “piece

of shit” and that he “never wants to see his face again.” As Menendez was walking away, he

thrust his finger towards Menendez’s face in a threatening manner and warned Menendez not to

start anything.

60. On October 19, 2018, Kenney updated 1000 Lights business status with the Utah

Department of Commerce and added Menendez as a managing member.

61. On November 1, 2018, Plaintiff filed its Complaint against Defendants initiating

this action.

62. Since its inception, 1000 Lights has tried to create a better experience for both

customers and employees.

63. While 1000 Lights, One World, and other sky lantern festivals provide pre-lantern

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launch activities, sell merchandise, work with various vendors to provide food to the customers,

1000 Lights has differentiated itself from One Word.

64. 1000 Lights is a for profit business, but it seeks to give back to the communities

with whom it works.

65. 1000 Lights is creating a business model that will pay employees livable wages

and benefits that will allow employees to maintain long term employment with the company.

66. 1000 Lights seeks out musicians who are local to areas where the water lantern

festivals are held in an effort to help promote local artists.

67. 1000 Lights is working with various charitable organizations in the areas where

the water lantern festivals are held to bring awareness and raise money for the charities. For

example, 1000 Lights is working on an event in Las Vegas, Nevada where it plans to honor and

raise money for the victims of the 2017 shooting there.

68. 1000 Lights is also in the process of finding a national charity they can partner

with and donate 20 percent of their proceeds to on an ongoing basis.

FIRST CAUSE OF ACTION


(Trademark Infringement)

69. Defendant incorporates by reference its allegations in the proceeding paragraphs

and further alleges as follows:

70. Defendant is the owner and senior user of the “Light the Water” trademark in the

United States, having first used the mark in interstate commerce on July 17, 2018 in connection

with lantern festivals, public events, and associated goods and services.

71. Plaintiffs have misappropriated and used Defendants’ “Light the Water” mark,

without authorization in connection with identical services and identical goods.

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72. As a result of Plaintiffs misappropriation, Plaintiffs are creating a likelihood of

consumer confusion, as well as reverse confusion by proceeding to use the trademark “Light the

Water” throughout their business, including but not limited to, creating a website that uses the

trademark, using the trademark in emails to customers, and using the trademark in online and

print marketing material, despite knowing that the “Light the Water” mark was already being

used by 1000 Lights.

73. Defendants have been, and will continue to be, injured and damaged by Plaintiffs’

misappropriation of the “Light the Water” mark, including but not limited to a loss of goodwill

and business and customer relationships. Unless remedied, this injury will continue and will

create irreparable harm.

74. As a result, Defendants are entitled to a preliminary and permanent injunction

against Plaintiffs use of the “Light the Water” mark, as well as all other remedies available under

the Lanham Act, including but not limited to actual damages, costs, attorneys fees, Plaintiffs

profits derived from the infringing activities, and treble damages for willful infringement.

SECOND CAUSE OF ACTION


(Fraud on the United States Patent and Trademark Office)

75. Defendant incorporates by reference its allegations in the proceeding paragraphs

and further alleges as follows:

76. On July 13, 2018, Plaintiffs attempted to improperly assert their rights to the

trademark light the water by applying to federally register the trademark “Light the Water”, even

though they knew that they are not the senior user of the trademark.

77. In applying for registration for the “Light the Water” mark, Plaintiff by and

through the signature of Mike Schaefer, signed a declaration affirming that ““to the best of his

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facts, knowledge or belief, no other person, firm, corporation, or association has the right to use

this mark in commerce.”

78. At the time of filing the declaration, Plaintiffs knew that prior to their application

that Defendants were using and had been using the “Light the Water” trademark in interstate

commerce.

79. As such, Plaintiffs’ declaration that to the best of his facts, knowledge or belief,

no other person, firm, corporation, or association has the right to use this mark in commerce”

constitutes a false representation regarding a material fact regarding the “Light the Water”

trademark that had been applied for.

80. Upon information and belief, Plaintiff intended to induce reliance by the USPTO

in accepting the Light the Water application based on this false declaration.

81. Upon information and belief, the USPTO reasonably relied on the

misrepresentation by Plaintiffs, as evidenced by the USPTO examining attorney approving the

application for publication for opposition.

82. Defendant has suffered damages as a result of the USPTO’s reliance on Plaintiffs’

misrepresentation to the USPTO.

83. Furthermore, Plaintiffs alleged and claimed in their trademark application a date

of first use of the “Light the Water” mark in interstate commerce of 11/16/2018, which is not

only untrue, but impossible.

84. Upon information and belief, the USPTO reasonably relied on the

misrepresentation by Plaintiffs, as evidenced by the USPTO examining attorney approving the

application for publication for opposition.

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85. Defendant has suffered damages as a result of the USPTO’s reliance on Plaintiffs’

misrepresentation to the USPTO.

86. As Plaintiffs knowingly made at least two false and misleading representations to

the USPTO that the USPTO reasonably relied upon, Plaintiffs “Light the Water” application

should be denied registration.

THIRD CAUSE OF ACTION


(Unfair Competition)

87. Defendant incorporates by reference its allegations in the proceeding paragraphs and

further alleges as follows:

88. Plaintiffs have engaged in several intentional business acts to create unfair competition

against Defendants, in an attempt to harm or otherwise put them out of business.

89. Plaintiffs contacted 1000 Lights’ event venues falsely alleging that 1000 Lights is not a

viable company and that the venues should not be doing business with 1000 Lights.

90. Plaintiffs have engaged in malicious cyber activity by making Facebook posts on 1000

Lights’ Facebook falsely stating that 1000 Lights is a scam.

91. Plaintiffs have attempted to create reverse confusion improperly using and attempting to

register the trademark “Light the Water.”

92. Plaintiffs have otherwise engaged in a scheme, including litigation, to create the

impression that Defendants infringed on Plaintiff’s trademark hoping that Defendants cannot withstand a

lawsuit and will be forced to shut down their business.

93. The Court should award Defendants their damages, to be proved at trial, for Plaintiffs’

actions that have caused unfair competition and Defendants’ attorney fees and costs for having to defend

against Plaintiffs’ malicious lawsuit.

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FOURTH CAUSE OF ACTION


(Interference with Economic Relations)

94. Defendant incorporates by reference its allegations in the proceeding paragraphs and

further alleges as follows:

95. Plaintiffs and Third-party Defendants have attempted to interfere with Defendants’

economic relationships with their venues by contacting the venues and falsely alleging that 1000 Lights is

a not a viable and trustworthy company.

96. Plaintiffs and Third-party Defendants have attempted to interfere with Defendants’

economic relationships with 1000 Lights customer and potential customer by making Facebook posts

alleging that 1000 Lights is a sham company and is perpetuating a fraud on consumers.

97. Plaintiffs and Third-party Defendants have attempted to interfere with Defendants’

economic relations by attempting to create reverse confusion in the marketplace by using the trademark

“Light the Water” knowing that they are not the senior user of the trademark.

98. Plaintiffs and Third-party Defendants are attempting to interfere with Defendants’

economic relations buy initiating this litigation in the hopes that Defendants cannot withstand prolonged

litigation and that as a result 1000 Lights will have to fold.

99. The Court should award Defendants their damages, to be proved at trial, for Plaintiffs’

and Third-party Defendants’ actions that have caused interference with their economic relations and

Defendants’ attorney fees and costs for having to defend against Plaintiffs’ malicious lawsuit.

100. Plaintiffs and Third-party Defendants are also attempting to use this litigation to put

Defendants out of business, hoping to profit from unfairly eliminating their direct competition and to

unfairly assume Defendants’ events and customers.

101. Plaintiffs and Third-party Defendants should not be allowed to keep any proceeds or befit

that they have or will obtain by their unlawful actions to eliminate their competition, 1000 Lights.

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102. The Court should award Defendants their damages, to be proved at trial, for Plaintiffs’

and Third-party Defendants’ actions that have unjustly enriched them and Defendants’ attorney fees and

costs for having to defend against Plaintiffs’ and Third-party Defendants’ malicious lawsuit.

SIX CAUSE OF ACTION


(Defamation)

103. Defendant incorporates by reference its allegations in the proceeding paragraphs and

further alleges as follows:

104. Plaintiffs and specifically, Third-party Defendants, Michael Schaefer and David Knight,

contacted several of 1000 Lights’ venues and told them that they should not work with Defendants

because they are going to be sued and are otherwise not a viable or trustworthy company, with the intent

to persuade the venues not to work or do business with Defendants.

105. Plaintiffs, specifically Third-party Defendants Michael Schaefer and David Knight,

published a Facebook post claiming that 1000 Lights is a sham and fraudulent company and were using

that post to redirect 1000 Lights customers to One World’s water lantern festival.

106. The Court should enjoin Plaintiffs and Third-party Defendants from making and

publishing any defamatory statements against Defendants.

107. The Court should award Defendants their damages, to be proved at trial, for Plaintiffs’

and Third-party Defendants defamatory statements and Defendants’ attorney fees and costs.

SEVENTH CAUSE OF ACTION


(Violation of Fair Labor Standards Act)

108. Defendant incorporates by reference its allegations in the proceeding paragraphs and

further alleges as follows:

109. Plaintiffs did not fairly compensate Menendez for the time he spent working for YOLO

and One World.

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110. Plaintiffs paid Menendez a small flat fee for his travel time and hours worked when

traveling as opposed to paying him by the hour for work done on behalf of Plaintiffs and for travel time

during normal workday hours.

111. Plaintiffs should be ordered to pay Menendez his back wages earned while travel and

working out of town for Plaintiffs.

PRAYER FOR RELIEF

In light of the foregoing, Defendant respectfully prays:

A. That the Court bars Plaintiff’s pending trademark application;

B. That the Court issue a permanent injunction enjoining Plaintiff from using “Light

the Water.”

C. That Defendants be awarded any profits Plaintiffs derived from its wrongful

actions against Defendants, the sum of which to be proved at trial;

D. That Defendants be awarded their actual damages sustained as a result of

Plaintiff’s wrongful and malicious actions, the sum of which to be proved at trial;

E. That Defendants be awarded punitive damages for Plaintiff’s willful and

intentional actions that harmed Defendants;

F. That Defendants be awarded their attorney fees and costs for having to defend and

counter claim against Plaintiff’s action; and

G. That the Court grant Defendant’s such other and further relief that it deems

appropriate.

DATED this 26th day of November 2018.

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Case 1:18-cv-00140-CW-EJF Document 12 Filed 11/26/18 Page 42 of 43

GREEN LEGAL GROUP, P.C.

/s/Joshua M. Green
Counsel for Defendants

CERTIFICATE OF SERVICE

I hereby certify that on this 26th day of November 2018, I caused a true and correct copy

of the foregoing proposed ANSWER AND COUNTER CLAIM to be served via the Court’s

electronic filing system upon the following:

Brandon J. Baxter, Esq.


Michael D. Jewell, Esq.
PECK HADFIELD BAXTER & MOORE, LLC
399 N. Main Street, Suite 300
Logan, Utah 84321

bbaxter@peckhadfield.com
mjewell@peckhadfield.com

/s/Joshua M. Green

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Case 1:18-cv-00140-CW-EJF Document 12 Filed 11/26/18 Page 43 of 43

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