                FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT


WELLS FARGO & COMPANY; WELLS              No. 13-15625
FARGO INSURANCE SERVICES USA,
INC.,                                       D.C. No.
             Plaintiffs-Appellants,      4:12-cv-03856-
                                              PJH
                v.

ABD INSURANCE & FINANCIAL                ORDER AND
SERVICES, INC., FKA Insurance             OPINION
Leadership Network, Inc.; KURT DE
GROSZ; BRIAN HETHERINGTON,
              Defendants-Appellees.


     Appeal from the United States District Court
        for the Northern District of California
     Phyllis J. Hamilton, District Judge, Presiding

               Argued and Submitted
     December 2, 2013—San Francisco, California

                 Filed March 3, 2014

   Before: Michael Daly Hawkins, Ronald M. Gould,
         and Richard A. Paez, Circuit Judges.

                       Order;
               Opinion by Judge Gould
2     WELLS FARGO V. ABD INS. & FINANCIAL SERVS.

                           SUMMARY*


           Preliminary Injunction / Lanham Act

    The panel withdrew the mandate, granted a request for
publication, withdrew a memorandum disposition, and filed
an opinion reversing the district court’s denial of plaintiffs’
motion for a preliminary injunction in a trademark
infringement case.

     The panel held that the district court abused its discretion
in its analysis of plaintiffs’ likelihood of success on the merits
of their claims. First, the district court abused its discretion
when it did not consider a false advertising claim separately
from a trademark infringement claim because the two claims
were distinct and required the application of separate tests.
Second, the panel held that the district court abused its
discretion in its analysis of the abandonment defense to the
trademark infringement claim when it considered evidence of
prospective intent to abandon the mark to determine whether
plaintiffs’ uses were bona fide and in the ordinary course of
business. The panel reversed the district court’s order and
remanded the case for reconsideration and further
proceedings.




  *
    This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
     WELLS FARGO V. ABD INS. & FINANCIAL SERVS.           3

                       COUNSEL

Kevin D. Rising (argued) and Stephen R. Mick, Barnes &
Thornburg LLP, Los Angeles, California; Felicia J. Boyd,
Barnes & Thornburg LLP, Minneapolis, Minnesota, for
Plaintiffs-Appellants Wells Fargo & Co. et al.

Benjamin K. Riley (argued), Kerry L. Duffy, and Jayne
Laiprasert, Bartko, Zankel, Bunzel & Miller, San Francisco,
California, for Defendants-Appellees ABD Insurance &
Financial Services, Inc. et al.


                         ORDER

   The mandate issued in this case is withdrawn. Stoel
Rives’ request for publication is GRANTED, and the
Memorandum Disposition issued on December 20, 2013 and
amended by order on February 6, 2014, is withdrawn. The
withdrawn memorandum disposition is replaced and
superseded by the attached opinion.

    No petitions for rehearing and/or rehearing en banc will
be entertained.



                        OPINION

GOULD, Circuit Judge:

    Appellants Wells Fargo & Co. et al. (“Wells Fargo”)
bring this case against Appellees ABD Insurance and
Financial Services et al. (“New ABD”) arguing that the
4    WELLS FARGO V. ABD INS. & FINANCIAL SERVS.

district court abused its discretion when it denied Wells
Fargo’s motion for preliminary injunction. We have
jurisdiction pursuant to 28 U.S.C. § 1291, and we reverse the
district court’s order and remand the case for reconsideration
of the motion for preliminary injunction consistent with this
opinion.

    Wells Fargo acquired the original ABD Insurance and
Financial Services (“Former ABD”) in 2007, at which point
hundreds of Former ABD employees joined Wells Fargo
offices. In 2008, Wells Fargo changed the name of ABD to
“Wells Fargo Insurance Services,” but continued to display
the Former ABD mark on customer presentations and
solicitations, to maintain the abdi.com website and metatags,
and to accept customer payments made to ABD. However,
members of the Former ABD left Wells Fargo in 2009 and
created a new insurance and financial services company
called Insurance Leadership Network, Inc. (“ILN”). Those
members then used ILN to launch New ABD in June or July
2012, using the exact same name as Former ABD, when they
learned that Wells Fargo had not renewed the registration of
the Former ABD mark. Wells Fargo filed suit against New
ABD on July 24, 2012 asserting trademark, false affiliation
and advertisement, and unfair competition claims. Wells
Fargo filed a motion for a preliminary injunction on January
16, 2013. The district court denied that motion by order of
March 8, 2013.

     The district court’s denial of preliminary injunctive relief
is reviewed for an abuse of discretion. Brookfield Comms.,
Inc. v. West Coast Entm’t Corp., 174 F.3d 1036, 1045–46
(9th Cir. 1999). “‘A district court would necessarily abuse its
discretion if it based its ruling on an erroneous view of the
law,’ Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 405
      WELLS FARGO V. ABD INS. & FINANCIAL SERVS.                5

(1990), so we review the underlying legal issues de novo.”
Brookfield Comms., 174 F.3d at 1046 (citations omitted).

    A plaintiff seeking a preliminary injunction must
establish: (1) a likelihood of success on the merits, (2) that
the plaintiff will likely suffer irreparable harm in the absence
of preliminary relief, (3) that the balance of equities tip in its
favor, and (4) that the public interest favors an injunction.
Winter v. N.R.D.C., Inc., 555 U.S. 7, 20 (2008). We agree
with Wells Fargo that the district court erred in its view of the
applicable law and therefore abused its discretion in its
analysis of the first element, the likelihood of success on the
merits.

    First, the district court abused its discretion when it did
not separately consider the false advertisement claim. The
district court included that claim in its trademark
infringement analysis because it found false advertisement to
be “derivative of Wells Fargo’s trademark infringement
claim.” However, the two claims are distinct and require the
application of separate tests. To succeed on a false
advertisement claim under Lanham Act § 43(a), a plaintiff
must prove:

        (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
6    WELLS FARGO V. ABD INS. & FINANCIAL SERVS.

       false statement, either by direct diversion of
       sales from itself to defendant or by lessening
       of the goodwill associated with its products.

Southland Sod Farms v. Stover Seed Co., 108 F.3d 1134,
1139 (9th Cir. 1997) (citations omitted). The false
advertisement test requires a plaintiff to show all five
elements. Id. By contrast, a claim for trademark
infringement requires only two elements: (1) ownership of a
trademark, and (2) that the plaintiff show a likelihood of
confusion through the balancing of eight factors. Rearden
LLC v. Rearden Commerce, Inc., 683 F.3d 1190, 1202 (9th
Cir. 2012). These tests are distinct, and the district court
abused its discretion when it did not separately consider the
false advertisement claim.

    The district court also abused its discretion by
misapplying the law in its abandonment analysis when it
considered evidence of prospective intent to abandon the
mark to determine whether Wells Fargo’s uses were bona fide
and in the ordinary course of business.             To prove
abandonment of a mark as a defense to a claim of trademark
infringement, a defendant must show that there was:
“(1) discontinuance of trademark use and (2) intent not to
resume such use.” Electro Source, LLC v. Brandess-Kalt-
Aetna Grp., Inc., 458 F.3d 931, 935 (9th Cir. 2006). The
phrase “trademark use” means “the bona fide use of a mark
in the ordinary course of trade, and not merely to reserve a
right in a mark.” Id. at 936 (quoting 15 U.S.C. §1127). Even
a “single instance of use is sufficient against a claim of
abandonment of a mark if such use is made in good faith.”
Carter-Wallace, Inc. v. Procter & Gamble Co., 434 F.2d 794,
804 (9th Cir. 1970). All bona fide uses in the ordinary course
of business must cease before a mark is deemed abandoned.
      WELLS FARGO V. ABD INS. & FINANCIAL SERVS.                 7

    We have said that “unless the trademark use is actually
terminated, the intent not to resume use prong of
abandonment does not come into play.” Electro Source,
458 F.3d at 937–38. “[A] prospective intent to abandon says
nothing about whether use of the mark has been
discontinued.” Id. at 937.

     The district court held that Wells Fargo abandoned the
ABD mark, reasoning that Wells Fargo’s continued uses of
the ABD mark were not bona fide and in the ordinary course
of trade because such uses were “residual . . . or in the context
of a historical background” given Wells Fargo’s rebranding
efforts. The district court’s abandonment findings were
flawed for two significant reasons. First, prospective intent
to abandon is not properly considered when examining
whether bona fide uses of the mark in the ordinary course of
business have ceased, and the district court erred when it
considered Wells Fargo’s intent to rebrand ABD in that
context. Second, the district court misconstrued the breadth
of uses included within the scope of a “bona fide use in the
ordinary course of trade.” Courts must consider the totality
of the circumstances surrounding the use, and “even a
declining business retains, may benefit from, or may continue
to build its goodwill until it shuts its doors or ceases use of its
marks.” Id. at 938. In this case, Wells Fargo continued to
use the mark in several ways, most notably in customer
presentations and solicitations. Such uses demonstrate Wells
Fargo’s business calculation that it could continue to benefit
from the goodwill and mark recognition associated with
ABD, and we conclude that Wells Fargo continued its bona
fide use of the mark in the ordinary course of business
through these uses. Thus, the district court erred by
concluding that Wells Fargo abandoned the ABD mark,
contrary to the principles of Electro Source.
8    WELLS FARGO V. ABD INS. & FINANCIAL SERVS.

     Finally, at the preliminary injunction stage, evidence of
actual confusion is of diminished importance when a court
examines the likelihood of confusion for a trademark
infringement claim. Network Automation, Inc. v. Advanced
Sys. Concepts, 638 F.3d 1137, 1151 (9th Cir. 2011) (“[W]hile
[actual confusion] is a relevant factor for determining the
likelihood of confusion . . . its importance is diminished at the
preliminary injunction stage of the proceedings.”). Because
a motion for preliminary injunction normally occurs early in
litigation, at that point parties rarely have amassed significant
evidence of actual confusion. Id. For that reason, while
actual confusion is a critical factor in a full likelihood of
confusion analysis, it is less important at the preliminary
injunction stage, and we caution against resting a finding of
the likelihood of success of a trademark infringement claim
on that factor.

     We also note that although the district court did not abuse
its discretion by omitting consideration of the false affiliation
claim because it was not properly raised below, we see no
reason why that claim cannot be raised on remand and
therefore hold that Wells Fargo can address any false
affiliation claims it has in further proceedings consistent with
this opinion. We further note that the district court
determined that Wells Fargo failed to establish that it would
likely suffer irreparable harm if a preliminary injunction did
not issue. In light of our recent decision in Herb Reed
Enterprises, LLC v. Florida Entertainment Management, Inc.,
736 F.3d 1239 (9th Cir. 2013), we decline to address this
issue. Because neither the district court nor the parties had
the benefit of Reed, the district court should revisit the issue
of irreparable harm on remand. See id. at 1250 (“Evidence of
loss of control over business reputation and damage to
goodwill could constitute irreparable harm.”).
     WELLS FARGO V. ABD INS. & FINANCIAL SERVS.              9

    For the reasons stated above, we conclude that the district
court abused its discretion in its analysis of Wells Fargo’s
likelihood of success on the merits of its claims, and we
reverse the district court’s order and remand for
reconsideration and further proceedings.

   REVERSED and REMANDED.
