## Facts

- Sugar Busters, L.L.C. was formed by authors of a successful diet book titled *SUGAR BUSTERS! Cut Sugar to Trim Fat*, promoting reduced consumption of sugar and certain carbohydrates.
- Ellen C. Brennan worked as an independent consultant assisting with sales, publishing, and marketing of the first edition and contributed a favorable foreword.
- During her consultancy, Brennan and an author discussed a cookbook related to the diet; after the plaintiff decided partners should not pursue independent projects, Brennan proceeded to publish a cookbook on her own.
- Brennan and co-defendants published and marketed a cookbook titled *SUGAR BUST For Life!* as a companion to the diet program.
- Sugar Busters sued alleging, among other claims, infringement of a federally registered service mark “SUGARBUSTERS,” and sought to stop defendants from selling or distributing the cookbook.
- The “SUGARBUSTERS” registration originated with an unrelated business: a retail store selling products and information to diabetics.
- The registration passed through a chain of assignments among multiple entities before being acquired by Sugar Busters, without transfer of the original retail business or its associated goodwill.
- The district court found the registered service mark valid and granted a preliminary injunction barring defendants from selling or distributing *SUGAR BUST For Life!* as infringing the registered mark.

## Issues

1. Whether the “SUGARBUSTERS” service-mark registration was validly assigned to Sugar Busters or was an invalid assignment in gross because it was transferred without the goodwill of the business connected to the mark.
2. Whether a preliminary injunction based on infringement of a federally registered mark could stand if the asserted registration was invalid.
3. Whether, despite an invalid registration, Sugar Busters could pursue Lanham Act § 43(a) unfair-competition relief based on the book title and alleged consumer confusion.

## Decision

- The Fifth Circuit held the assignment of the registered “SUGARBUSTERS” service mark to Sugar Busters was in gross and therefore invalid.
- Because the registration was invalid, the district court erred in granting preliminary injunctive relief premised on infringement of a valid registered mark.
- The court vacated the preliminary injunction.
- The court remanded for consideration of potential relief under Lanham Act § 43(a), including secondary meaning, likelihood of confusion, fair use, and equitable considerations.

## Legal Principles

- A trademark or service mark cannot be assigned apart from the goodwill of the business with which the mark is associated; a “naked” transfer of the mark or registration without the accompanying business/goodwill is invalid as an assignment in gross.
- A preliminary injunction grounded on infringement of a federally registered mark cannot be sustained when the asserted registration is invalid.
- Even without a valid registration, a plaintiff may seek protection under Lanham Act § 43(a) for unfair competition involving an unregistered designation (including a book title), typically requiring proof of secondary meaning (when applicable) and likelihood of confusion, subject to defenses such as fair use and equitable limits.

## Conclusion

The Fifth Circuit vacated an injunction that rested on a federally registered service mark because the registration had been transferred to the plaintiff without the goodwill of the original business, rendering the assignment invalid; it remanded for the district court to evaluate whether the plaintiff could obtain relief under Lanham Act § 43(a) based on the book title and alleged confusion.


Sugar Busters, L.L.C. v. Brennan, 177 F.3d 258 (5th Cir. 1999)