Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 1 of 15
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`UNITED STATES DISTRICT COURT
`WESTERN DISTRICT OF WASHINGTON
`AT SEATTLE
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`REX – REAL ESTATE EXCHANGE,
`INC.,
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`Plaintiff,
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`v.
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`ZILLOW, INC.; ZILLOW GROUP,
`INC.; ZILLOW HOMES, INC.;
`ZILLOW LISTING SERVICES, INC.;
`TRULIA, LLC; and THE NATIONAL
`ASSOCIATION OF REALTORS,
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`Defendants.
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`C21-312 TSZ
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`ORDER
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`THIS MATTER comes before the Court on the motion to dismiss, docket no. 115,
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`filed by Counterclaim-Defendant REX – Real Estate Exchange, Inc. (“REX”). Having
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`reviewed all papers filed in support of, and in opposition to, the motion, the Court enters
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`the following Order.
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`Background
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`On January 27, 2022, the National Association of REALTORS® (“NAR”) filed its
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`responsive pleading, docket no. 114. In its responsive pleading, NAR raises a
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`counterclaim against REX for false advertising in violation of the Lanham Act, 15 U.S.C.
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`§ 1125(a). Countercl. at ¶¶ 68–75 (docket no. 114). NAR alleges that REX has made
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`numerous “false and misleading statements of fact in commercial advertisements about
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`ORDER - 1
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`

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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 2 of 15
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`REX’s products, services and commercial activities.” Id. at ¶ 69. NAR challenges a
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`number of statements posted on REX’s website, www.rexhomes.com, concerning
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`whether REX’s clients pay buyer-agent commission fees and whether REX’s technology
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`is innovative, as well as statements alleging that NAR has enacted anticompetitive
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`policies that artificially inflate fees in real estate transactions. See id. at ¶¶ 7–50. NAR
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`alleges that REX’s statements have harmed NAR’s goodwill and reputation with its own
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`members and consumers. Id. at ¶ 63. REX now moves to dismiss NAR’s counterclaim
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`on grounds that NAR: (i) lacks Article III standing, (ii) lacks statutory standing under the
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`Lanham Act, and (iii) cannot use the Lanham Act to chill REX’s constitutional right to
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`challenge conduct it believes harms consumers. See generally Mot. to Dismiss (docket
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`no. 115).
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`Discussion
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`1.
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`Article III Standing
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`“[L]ack of Article III standing requires dismissal for lack of subject matter
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`jurisdiction under Federal Rule of Civil Procedure 12(b)(1).” Maya v. Centex Corp., 658
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`F.3d 1060, 1067 (9th Cir. 2011). In its motion to dismiss NAR’s counterclaim, REX
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`presents a facial, rather than a factual, jurisdictional challenge. A facial attack asserts
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`that the allegations of the pleading are insufficient on their face to invoke federal
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`jurisdiction. See Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1038 (9th Cir. 2004).
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`With respect to a facial challenge under Rule 12(b)(1), a plaintiff is entitled to the same
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`safeguards that apply to a Rule 12(b)(6) motion to dismiss for failure to state a claim. See
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`Friends of Roeding Park v. City of Fresno, 848 F. Supp. 2d 1152, 1159 (E.D. Cal. 2012).
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`ORDER - 2
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`

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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 3 of 15
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`The allegations of the complaint are presumed to be true, id., and the Court may not
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`consider matters outside the pleading without converting the motion into one for
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`summary judgment, see White v. Lee, 227 F.3d 1214, 1242 (9th Cir. 2000).
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`To bring suit in federal court, a plaintiff must have suffered sufficient injury to
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`satisfy the “case or controversy” requirement of Article III of the United States
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`Constitution. Bennett v. Spear, 520 U.S. 154, 162 (1997). Three elements are required to
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`establish the “irreducible constitutional minimum of standing.” Lujan v. Defs. of
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`Wildlife, 504 U.S. 555, 560 (1992).
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`First, the plaintiff must have suffered an “injury in fact”—an invasion of a
`legally protected interest which is (a) concrete and particularized and
`(b) actual or imminent, not conjectural or hypothetical. Second, there must
`be a causal connection between the injury and the conduct complained of—
`the injury has to be fairly traceable to the challenged action of the defendant,
`and not the result of the independent action of some third party not before
`the court. Third, it must be likely, as opposed to merely speculative, that the
`injury will be redressed by a favorable decision.
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`Id. at 560–61 (internal citations and quotations omitted). A plaintiff must clearly allege
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`facts demonstrating every element of standing. Spokeo, Inc. v. Robins, 578 U.S. 330, 338
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`(2016). “At the pleading stage, general factual allegations of injury resulting from the
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`defendant’s conduct may suffice, for on a motion to dismiss we presume that general
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`allegations embrace those specific facts that are necessary to support the claim.” Lujan,
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`504 U.S. at 561 (internal citations and quotations omitted).
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`An organization can bring suit in federal court under two theories of standing:
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`(i) by suing on its own behalf, or (ii) by suing on behalf of its members. In this case,
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`NAR brings the counterclaim on its own behalf. See Countercl. at ¶ 53 (claiming that
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`ORDER - 3
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`

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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 4 of 15
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`NAR has been harmed by REX’s allegedly false advertisements). Like any individual, to
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`sue on its own behalf, an organization must demonstrate that it suffered an injury in fact.
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`La Asociación de Trabajadores de Lake Forest v. City of Lake Forest, 624 F.3d 1083,
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`1088 (9th Cir. 2010). “An organization suing on its own behalf can establish an injury
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`when it suffered ‘both a diversion of its resources and a frustration of its mission.’” Id.
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`(quoting Fair Hous. of Marin v. Combs, 285 F.3d 899, 905 (9th Cir. 2002)).1 REX
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`contends that NAR’s counterclaim must be dismissed because NAR did not plead
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`sufficient facts to establish that it suffered an injury in fact. NAR does not dispute that it
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`failed to plead facts demonstrating a frustration of its organizational mission and a
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`diversion of its resources. Rather, NAR argues that it pleaded sufficient facts to establish
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`that it suffered a reputational injury. In TransUnion LLC v. Ramirez, 141 S. Ct. 2190,
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`(2021), the Supreme Court explained that “various intangible harms,” such as
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`reputational harm, can qualify as concrete injuries for standing purposes. Id. at 2204; see
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`also Meese v. Keene, 481 U.S. 465, 479 n.14 (1987) (“[T]he risk of this reputational
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`harm, as we have held earlier in this opinion, is sufficient to establish appellee’s standing
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`to litigate the claim on the merits.”).
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`NAR cites Walker v. City of Lakewood, 272 F.3d 1114 (9th Cir. 2001), and
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`Presbyterian Church (U.S.A.) v. United States, 870 F.2d 518 (9th Cir. 1989), for the
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`proposition that an organization’s allegations of reputational injury, standing alone, are
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`1 See also Smith v. Pac. Props. & Dev. Corp., 358 F.3d 1097, 1105 (9th Cir. 2004); Am. Diabetes Ass’n v.
`U.S. Dep’t of the Army, 938 F.3d 1147, 1154 (9th Cir. 2019); Rodriguez v. City of San Jose, 930 F.3d
`1123, 1134 (9th Cir. 2019).
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`ORDER - 4
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 5 of 15
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`sufficient to establish injury in fact. These cases, however, do not support NAR’s
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`argument. Unlike in Walker, in which the organization was not paid for its services for
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`several months, was the subject of a performance complaint to a third party, lost staff
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`time responding to retaliatory activities, and lost other contracts, see 272 F.3d at 1124, in
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`this matter, NAR fails to allege anything more than generalized reputational harm.2 The
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`organization in Walker also alleged that it “suffered injury in its ability to carry out its
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`purposes . . . .” Id. at 1124. Likewise, in Presbyterian Church, the Ninth Circuit found
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`that various church plaintiffs sufficiently alleged injury analogous to reputational or
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`professional harm that “interfered with the churches’ ability to carry out their religious
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`mission.” 870 F.2d at 522–23. The churches alleged that government surveillance
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`efforts occurring in the churches “impaired the churches’ ability to carry out their
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`religious missions” by deterring members from attending religious observances. Id. at
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`521–23. The churches also alleged that “clergy time [was] diverted from regular pastoral
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`duties” as a direct result of the challenged conduct. Id. at 522. Unlike the organizations
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`in Walker and Presbyterian Church, NAR does not allege a frustration of its mission or a
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`diversion of its resources.
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`In this case, NAR contends that REX has harmed NAR through the following
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`allegedly false claims: (i) REX offers low commissions and has superior technology,
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`2 In Walker, the Ninth Circuit reviewed a district court order concerning summary judgment. 272 F.3d at
`1124 (“Because this case is at the summary judgment stage, the [organization] must support [its]
`allegations with ‘specific facts.’” (citing Lujan, 504 U.S. at 561)). Accordingly, the Ninth Circuit used a
`different legal standard than the standard applicable to this Court’s consideration of REX’s motion to
`dismiss.
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`ORDER - 5
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 6 of 15
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`(ii) NAR has artificially inflated commissions and hindered the development of
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`technology for home listings, and (iii) NAR has engaged in unlawful or unfair conduct.
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`Countercl. at ¶ 73. NAR does not allege that any consumers or brokers have withheld
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`trade from NAR as a result of the advertisements. Instead, NAR alleges, in a conclusory
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`fashion, that its “goodwill and reputation, both with its own members and consumers, has
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`been harmed.” Id. at ¶ 63. NAR has not, however, alleged facts explaining how REX’s
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`purportedly false advertisements have frustrated its mission or caused it to divert its
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`resources. Nor has NAR alleged sufficient facts to explain how REX’s advertisements to
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`consumers harm NAR’s reputation and goodwill among its own members, who NAR
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`does not claim were misled. See id. at ¶ 1 (“[REX’s] marketing and [public relations]
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`campaign is built on outright falsehoods and statements that—at best—are likely to
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`mislead or confuse consumers.”). The allegations in NAR’s counterclaim are insufficient
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`to show that the reputational harm it has allegedly suffered is concrete and particularized.
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`Therefore, the Court concludes that NAR has not alleged facts sufficient to
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`demonstrate an injury in fact for Article III standing.
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`2.
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`Statutory Standing and First Amendment Protection
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`REX also argues, under Rule 12(b)(6), that NAR has failed to state a claim for
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`false advertising under the Lanham Act because NAR lacks statutory standing and is
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`allegedly using the Lanham Act to chill REX’s constitutional rights.
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`a. Rule 12(b)(6) Standard
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`Although a complaint challenged by a Rule 12(b)(6) motion to dismiss need not
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`provide detailed factual allegations, it must offer “more than labels and conclusions” and
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`ORDER - 6
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 7 of 15
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`contain more than a “formulaic recitation of the elements of a cause of action.” Bell Atl.
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`Corp. v. Twombly, 550 U.S. 544, 555 (2007). A complaint may be lacking for one of two
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`reasons: (i) absence of a cognizable legal theory, or (ii) insufficient facts under a
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`cognizable legal claim. Robertson v. Dean Witter Reynolds, Inc., 749 F.2d 530, 534 (9th
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`Cir. 1984). In ruling on REX’s motion to dismiss, the Court must assume the truth of the
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`NAR’s allegations and draw all reasonable inferences in its favor. See Usher v. City of
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`Los Angeles, 828 F.2d 556, 561 (9th Cir. 1987). The question for the Court is whether
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`the facts in the counterclaim sufficiently state a “plausible” ground for relief. See
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`Twombly, 550 U.S. at 570. If the Court dismisses the counterclaim or portions thereof, it
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`must consider whether to grant leave to amend. See Lopez v. Smith, 203 F.3d 1122, 1130
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`(9th Cir. 2000).
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`b.
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`Statutory Standing Under the Lanham Act
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`REX contends that NAR lacks statutory standing to bring a claim for false
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`advertising. A claim for false advertising under the Lanham Act, 15 U.S.C. § 1125(a),
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`requires proof of the following elements:
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`(1) a false statement of fact by the defendant in a commercial advertisement
`about its own or another’s product; (2) the statement actually deceived or has
`the tendency to deceive a substantial segment of its audience; (3) the
`deception is material, in that it is likely to influence the purchasing decision;
`(4) the defendant caused its false statement to enter interstate commerce; and
`(5) the plaintiff has been or is likely to be injured as a result of the false
`statement, either by direct diversion of sales from itself to defendant or by a
`lessening of the goodwill associated with its products.
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`Southland Sod Farms v. Stover Seed Co., 108 F.3d 1134, 1139 (9th Cir. 1997). The
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`Lanham Act does not allow all factually injured parties to recover. Lexmark Int’l, Inc. v.
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`ORDER - 7
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 8 of 15
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`Static Control Components, Inc., 572 U.S. 118, 129 (2014). Instead, “a direct application
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`of the zone-of-interests test and the proximate-cause requirement supplies the relevant
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`limits on who may sue.” Id. at 134. First, “to come within the zone of interests in a suit
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`for false advertising under [the Lanham Act], a [party] must allege an injury to a
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`commercial interest in reputation or sales.” Id. at 131–32. Next, under the proximate-
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`cause requirement, a party ordinarily must show economic or reputational injury flowing
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`directly from the deception that occurs when the alleged false advertisements cause
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`consumers to withhold trade from the claimant. Id. at 133. When the parties are in direct
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`competition, a misrepresentation will give rise to a presumed commercial injury that is
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`sufficient to establish standing. TrafficSchool.com, Inc. v. Edriver Inc., 653 F.3d 820,
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`827 (9th Cir. 2011).
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`NAR satisfies the zone-of-interests test in this case because NAR alleges an injury
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`to a commercial interest in its reputation. Countercl. at ¶ 63; see also Lexmark, 572 U.S.
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`at 131–32. Accordingly, the Court turns to the proximate-cause requirement. In its
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`responsive pleading, NAR admits that it “is a trade association with approximately 1.5
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`million members and that it advocates for the interests of buyers and sellers of residential
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`real estate and for brokers.” Answer at ¶ 23 (docket no. 114). In contrast, REX is a
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`licensed broker and employs licensed real estate agents in various states, including
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`Washington. Am. Compl. at ¶ 39 (docket no. 99). NAR acknowledges that it “is not a
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`competitor to REX and is not claiming it was injured because it is a competitor to REX,”
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`Countercl. at ¶ 52, so NAR is not entitled to a presumption of commercial injury.
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`ORDER - 8
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 9 of 15
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`A plaintiff must plead some factual support to allege a plausible commercial
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`injury. Thermolife Int’l, LLC v. NeoGenis Labs, Inc., No. 18-cv-2980, 2019 WL
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`1438293, at *6 (D. Ariz. Apr. 1, 2019). The counterclaim alleges that REX published
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`false statements about its own services “to persuade consumers to use its services instead
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`of those offered by multiple listing services and members of NAR.” Countercl. at ¶ 61.
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`Because NAR does not bring the counterclaim on behalf of its members, NAR must
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`allege facts showing that its reputational injury flows directly from REX’s purportedly
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`false advertisements and that REX’s “deception of consumers cause[d] them to withhold
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`trade from [NAR].” Lexmark, 572 U.S. at 133.
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`NAR alleges that REX’s statements have harmed its reputation and goodwill
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`among consumers and its own members. Countercl. at ¶¶ 63 & 73. NAR also alleges
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`that “[w]hen consumers are deceived into avoiding multiple listing services they lose the
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`pro-competitive benefits created by multiple listing services. Sellers lose exposure to the
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`largest available pool of buyers. Buyers lose access to the largest available pool of
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`properties for sale.” Id. at ¶ 62. But, importantly, NAR has not alleged that any
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`consumers or brokers have withheld trade from NAR itself. Thus, NAR’s allegations are
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`insufficient to plausibly allege statutory standing under the Lanham Act.
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`c.
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`First Amendment Protection
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`REX also asserts that NAR has failed to state a Lanham Act claim for the
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`following reasons: (i) REX’s statements are not statements of fact made in commercial
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`speech, and (ii) the Noerr-Pennington doctrine protects REX’s right to challenge NAR’s
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`allegedly anticompetitive conduct.
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`ORDER - 9
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 10 of 15
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`i.
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`Statements of Fact and Commercial Speech
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`A claim for false advertising under the Lanham Act requires proof of a false
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`statement of fact in a defendant’s commercial advertisement. Southland Sod Farms, 108
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`F.3d at 1139. “Specific, quantifiable ‘statements of facts’ that refer to a product’s
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`absolute characteristics may constitute false advertising, while general, subjective,
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`unverifiable claims are ‘mere puffery’ that cannot.” RingCentral, Inc. v. Nextiva, Inc.,
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`No. 19-cv-02626, 2020 WL 4039322, at *3 (N.D. Cal. July 17, 2020) (quoting Newcal
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`Indus., Inc. v. Ikon Off. Sol., 513 F.3d 1038, 1053 (9th Cir. 2008)). Commercial speech is
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`“usually defined as speech that does no more than propose a commercial transaction.”
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`Ariix, LLC v. NutriSearch Corp., 985 F.3d 1107, 1115 (9th Cir. 2021) (quoting United
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`States v. United Foods, Inc., 533 U.S. 405, 409 (2001)). Nevertheless, “speech that does
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`not propose a commercial transaction on its face can still be commercial speech.” Id.
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`(citing Bolger v. Youngs Drug Prods. Corp., 463 U.S. 60, 66–68 (1983)). A court must
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`employ a “fact-driven” analysis when determining whether speech is commercial in
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`nature. Id. (citation omitted).
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`REX argues that NAR has failed to sufficiently plead a Lanham Act claim for
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`false advertising because the statements that NAR challenges are not statements of fact
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`and were not made in commercial speech; however, “[t]hese are both factual inquiries
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`that cannot be resolved on a 12(b)(6) motion.” See Mercer Publ’g, Inc. v. Smart Cookie
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`Ink, LLC, No. C12-0188, 2012 WL 5499871, at *3 (W.D. Wash. Nov. 13, 2012). In this
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`case, NAR challenges a number of statements posted on REX’s website, such as: “REX
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`charges a low fee by totally eliminating the buyer side agent commission,” “[e]ven if
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`ORDER - 10
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 11 of 15
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`your buyer is working with a non-REX agent, REX doesn’t ask sellers to cover the cost,”
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`and “REX’s services cost significantly less when compared with those of traditional real
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`estate agents.” Countercl. at ¶¶ 8, 9 & 11. NAR also alleges that REX posted statements
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`on its website blaming NAR’s rules and policies for “inflating consumer home prices by
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`as much as $50 billion per year,” while claiming that REX saves its customers “an
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`average of $10,435 off their home sales.” Id. at ¶¶ 12 & 13. Additionally, NAR alleges
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`that REX falsely claims its technology is innovative when compared to the Multiple
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`Listing Service (“MLS”) system, which allows REX to “reduce costs for all involved—
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`REX charges a fixed 2% covering both sides of the transaction instead of the 5-6%
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`customarily enforced by MLS participants.” Id. at ¶ 29. Although REX contends that its
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`statements are constitutionally protected opinions about the legality of NAR’s business
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`model, NAR has alleged that posts on REX’s website are false advertisements designed
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`to promote REX’s business and influence consumers to use REX’s services. NAR has
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`identified specific statements that contain verifiable characteristics of REX’s business.
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`That REX made certain statements to the media, and later posted those statements on its
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`website, see, e.g., Countercl. at ¶ 49, does not change the result at this stage of litigation.
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`Indeed, republication and dissemination of statements made to the media can constitute
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`commercial speech. W. Sugar Coop. v. Archer-Daniels-Midland Co., No. CV11-3473,
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`2015 WL 12683192, at *7 (C.D. Cal. Aug. 21, 2015). NAR has plausibly alleged that the
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`statements on REX’s website are false statements made in commercial advertising.
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`ORDER - 11
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 12 of 15
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`ii.
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`The Noerr-Pennington Doctrine
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`Finally, REX argues that NAR is barred from bringing its counterclaim because
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`the Noerr-Pennington doctrine shields REX from liability. Under the Noerr-Pennington
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`doctrine, “those who petition any department of the government for redress are generally
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`immune from statutory liability for their petitioning conduct.” Sosa v. DIRECTV, Inc.,
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`437 F.3d 923, 929 (9th Cir. 2006). Although the doctrine arises from anti-trust law, the
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`Supreme Court has expanded its application outside the antitrust field, id. at 930;
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`however, “[n]either the United States Supreme Court nor the Ninth Circuit Court of
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`Appeals has addressed the applicability of the Noerr–Pennington doctrine specifically to
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`claims that arise under Section 43(a) of the Lanham Act,” EcoDisc Tech. AG v. DVD
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`Format/Logo Licensing Corp., 711 F. Supp. 2d 1074, 1084 (C.D. Cal. 2010).3 NAR does
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`not contend that the Noerr–Pennington doctrine cannot be applied to false advertising
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`claims under the Lanham Act. Instead, NAR argues that the challenged statements do not
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`relate to litigation or REX’s efforts to petition the government.
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`Communications are protected under the Noerr–Pennington doctrine, “so long as
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`they are sufficiently related to petitioning activity.” Sosa, 437 F.3d at 935.
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`Communications “incidental to a lawsuit” also fall within the protection of the Noerr–
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`Pennington doctrine. Theme Promotions, Inc. v. News Am. Mktg. FSI, 546 F.3d 991,
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`3 Other courts have held that the Noerr–Pennington doctrine should be applied to such claims. See, e.g.,
`Sliding Door Co. v. KLS Doors, LLC, No. EDCV13-196, 2013 WL 2090298, at *6 (C.D. Cal. May 1,
`2013); AirHawk Int’l, LLC v. TheRealCraigJ, LLC, No. SACV16-624, 2017 WL 3891214, at *3 (C.D.
`Cal. Jan. 19, 2017).
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`ORDER - 12
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 13 of 15
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`1007 (9th Cir. 2008). For example, in Sliding Door Co. v. KLS Doors, LLC, the court
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`determined that the Noerr–Pennington doctrine barred defendants’ claim for false
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`advertising because the communication at issue, an email sent to consumers informing
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`them that plaintiff had sued defendant for patent infringement, was sufficiently related to
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`the petitioning activity of filing the lawsuit. 2013 WL 2090298, at *5–7.
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`Here, REX asserts that its efforts before the courts, the Department of Justice, and
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`Congress, are protected speech under the under the Noerr–Pennington doctrine. REX
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`argues that it has engaged in a campaign against NAR and its anticompetitive practices
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`since 2018. REX further contends that it has successfully petitioned the Department of
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`Justice to file a lawsuit against NAR and has defeated NAR’s motions, docket nos. 84
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`and 101, to dismiss its antitrust claims in this action. The Court is not, however,
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`convinced that the statements at issue in the counterclaim are incidental to REX’s
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`petitioning activities. NAR challenges a number of statements on REX’s website in
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`which REX describes its own services and technology, and how its services compare to
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`those offered by individuals and organizations affiliated with NAR. See, e.g., Countercl.
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`at ¶ 8 (“REX charges a low fee by totally eliminating the buy side agent commission.”),
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`¶ 9 (“Even if your buyer is working with a non-REX agent, REX doesn’t ask sellers to
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`cover the cost.”) & ¶ 13 (“By removing the obligation to pay two agent commissions for
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`a single transaction, [REX] save[s] [its] customers an average of $10,435 off their home
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`sales.”). NAR also challenges statements on REX’s website in which REX describes the
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`purported effect of NAR’s rules and policies. See, e.g., id at ¶ 12 (quoting a blog post on
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`REX’s website alleging that NAR’s rules “inflat[e] consumer home prices by as much as
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`ORDER - 13
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 14 of 15
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`$50 billion per year”). These statements, which NAR alleges are contained in
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`commercial advertisements on REX’s website, are not sufficiently related to REX’s
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`petitioning activities.
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`Accordingly, the Court does not grant the motion to dismiss based on REX’s
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`argument that the communications at issue are non-commercial statements of opinion, or
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`that its statements are protected by the Noerr-Pennington doctrine.
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`3.
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`Leave to Amend
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`Under Federal Rule of Civil Procedure 15(a), leave to amend shall be freely given
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`when justice so requires. Fed. R. Civ. P. 15(a). A district court may exercise its
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`discretion and deny leave to amend for a variety of reasons, including undue delay,
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`repeated failure to cure deficiencies by previous amendment, undue prejudice to the
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`opposing party, and futility of amendment. Carvalho v. Equifax Info. Servs., LLC, 629
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`F.3d 876, 892 (9th Cir. 2010). REX contends that amendment would be futile, but the
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`Court is not convinced, and therefore exercises its discretion to grant NAR leave to
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`amend its counterclaim.4
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`Therefore, NAR’s counterclaim, docket no. 114, is DISMISSED with leave to
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`amend.
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`Conclusion
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`For the foregoing reasons, the Court ORDERS:
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`4 In its reply, docket no. 119, REX argues for the first time that amendment would be futile because
`NAR’s action is barred by the statute of limitations. Although NAR has not filed a surreply requesting
`that the Court strike this argument, see LCR 7(g), the Court is not required to consider it, and the
`argument is not persuasive at this stage of the proceeding.
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`ORDER - 14
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`Case 2:21-cv-00312-TSZ Document 124 Filed 04/22/22 Page 15 of 15
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`(1)
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`The motion to dismiss, docket no. 115, filed by Counterclaim-Defendant
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`REX is GRANTED. NAR’s counterclaim for false advertising under the Lanham Act,
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`15 U.S.C. § 1125(a), docket no. 114, is DISMISSED without prejudice and with leave to
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`amend;
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`(2)
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`NAR shall file any amended counterclaim on or before June 6, 2022; and
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`(3)
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`The Clerk is directed to send a copy of this Order to all counsel of record.
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`IT IS SO ORDERED.
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`Dated this 22nd day of April, 2022.
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`A
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`Thomas S. Zilly
`United States District Judge
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`ORDER - 15
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`