Wednesday, March 19, 2008

“Vegas” Magazine Mega-Publisher Sues Connecticut Niche Publisher Over a “Niche” mark

On March 14, 2008, Niche Media Holdings, LLC (“NMH”) filed a lawsuit against Niche Downtown, LLC and Joseph A. Gazzola (the “Defendants”) in the U.S. District Court for the District of Nevada. A copy of the complaint can be downloaded here.

March 2008 Cover of "Vegas" Magazine

NMH is the publisher of such well-known regional magazines as “Los Angeles Confidential,” “Ocean Drive,” and “Vegas” – those oversized glossy magazines with articles and advertising catering to a high-end luxury market.

In its complaint, NMH claims to own rights to several marks containing the word “niche.” NMH currently has federal trademark applications pending for each of the following marks containing the word “niche”:

All of the applications are directed to the same two basic classes of goods and services—a series of printed magazines (class 16) and providing a series of online magazines (class 41), both featuring the lifestyles of high net worth individuals covering the areas of movies, theater, fashion, night-life, entertainment, art, ecology, sports, leisure, restaurants, travel, transportation, business, politics and music. (Note: The application for NICHE MEDIA currently reflects only one class; however, the examining attorney is requiring a separation into the same two classes as the others. In addition, while NICHE MEDIA ONLINE currently reflects these two classes, only class 41 will likely remain because the examining attorney inadvertently led NMH, through its amended description, to expand the scope of the goods and services outside the scope of the original application.)

With the exception of NICHE MEDIA, which was filed on August 2, 2005 as a use-in-commerce application based on alleged first use dating back to October 2000, all of the above applications were filed under as intent-to-use applications:

  • NICHE MEDIA ONLINE (filed December 29, 2005 – still under non-final)
  • NICHE MEDIA WORLDWIDE (filed December 29, 2005 – will be published for opposition April 8, 2008)
  • NICHE ACCESS (filed July 7, 2005 – will be published for opposition April 8, 2008)
  • NICHE MEDIA'S PALM BEACH (filed December 23, 2005 – will be published for opposition April 8, 2008)

It is interesting to note that a specimen of use was not submitted with the original application for NICHE MEDIA. One wonders if this was merely an oversight on the part of NMH when it originally filed the application or if it was because NMH could not procure a specimen that showed use of the mark on the goods and services set forth in the application at the time of filing. Based on the description of the specimen set forth in the application, however, NMH appears to be relying upon something similar to the below masthead (from NMH’s website).

At issue in the complaint are actions taken by Defendant Gazzola, a Connecticut resident, who organized Niche Downtown, LLC on September 15, 2006, and began conducting business under the name “Niche Hartford Magazine.” On November 17, 2006, Defendant Gazzola registered the domain name, which at the time promoted the pending publication of the magazine “Niche Hartford,” which was formally launched in January 2007 with the publication of its premier issue. The Defendants have since published five additional issues of the quarterly magazine.

NMH supposedly sent a cease and desist letter to the Defendants (although the date is not specified in the complaint). Defendants apparently did not comply with NMH’s demands, and have expanded the number of “marks” using the term “Niche” on its website including “NicheMagazine,” “Niche Advertising,” “Niche Editions,” “Niche Gallery,” and “NicheFamily.”

NMH claims that the Defendants, by using the term “niche” on its magazine, in its domain name, and on its website, are attempting to trade on the goodwill and reputation of NMH and attempting to create a false association between NMH and the Defendants. NMH claims unfair competition (arising from the Defendants’ infringement of NMH’s unregistered marks) under Section 43(a) of the Lanham Act (15 USC §1125(a)), cybersquatting under Section 43(d) of the Lanham Act (15 USC §1125(d)), common law trademark infringement, and intentional interference with a prospective economic advantage.

NMH seeks injunctive relief to stop the Defendants from using any more marks or registering any domain names containing the term “niche” and from publishing its “Niche Hartford” magazine. NMH also seeks a court order transferring the domain name to the NMH. Finally, NMH seeks the usual damages (compensatory, consequential, statutory, punitive) as well as interest, costs, and attorneys’ fees.

Vegas™Esq. Comments:
At first glance, NMH’s trademark infringement case would appear weak. After all, can NMH really claim to own the exclusive right to the word “niche” in the magazine world? However, when you start to apply the Sleekcraft factors for determining likelihood of confusion between the marks at issue, NMH’s case for trademark infringement does not appear so weak after all.

Regarding strength of the mark, NMH’s complaint asserts that it has spent substantial sums of money to advertise and promote its NICHE MEDIA name in print, broadcast media, and online. NMH can likely back this up, in which case this factor likely favors NMH.

As for similarity of the marks, while NMH uses the mark NICHE MEDIA and the Defendants use NICHE HARTFORD, the dominant part of each mark is the word NICHE (MEDIA is descriptive, as evidence by the disclaimer that NMH will certainly have to file to obtain its federal registration and HARTFORD is geographically descriptive of the subject matter of the Defendants’ magazine). So this factor favors NMH as well. Even if you only compare NMH’s NICHE MEDIA word marks with Defendant’s stylized NICHE HARTFORD logo, there is still enough similarity (black color, similar lettering) that the factor slightly favors NMH.

The relatedness of the goods is an interesting question. NMH is not really using its NICHE MEDIA mark on magazines per se, but rather the mark is used to promote a “series” of printed and online magazines featuring the lifestyles of high net worth individuals. Defendants, on the other hand, are using the mark as the name of an actual magazine that features articles and advertising of interest to local residents of the Hartford, Connecticut area. While I personally think that the content of the magazine is an important distinguishing factor, especially given NMH’s admitted focus on high net worth customers, a court is more likely to focus on the general fact that both marks are used in connection with magazines and not so much the content of those magazines (although NMH can probably also argue that there is some similarity in content as well). As such, the goods are likely to be deemed related, in which case this factor favors NMH.

Both parties use at least one form of the same type of marketing channels (online), so this favors NMH. It’s not clear from the complaint the degree to which the Defendants distribute hard copies of its magazines to the same stores where NMH’s magazines are sold, but there is likely to be some overlap.

Regarding customer degree of care, given the type of goods involved (low cost magazines), purchasers are not likely to exercise a high degree of care when purchasing, so this factor favors NMH.

Defendants’ intent in selecting the name “niche” is not clear, but I would be willing to give the Defendants the benefit of the doubt that the name was chosen not to capitalize on NMH’s goodwill, but rather for the more common meaning of “niche” (signifying something designed for a specialized market). The Defendants are located in the Hartford, Connecticut area and have carved out their own little “niche” by creating a magazine catering to the local community. Barring the discovery by NMH of any strong evidence of the Defendants’ intent to trade off NMH’s reputation and goodwill, this factor favors the Defendants.

Finally, as for likelihood of expansion, the complaint notes that NMH already distributes three of its publications to the Hartford, Connecticut area (“Boston Commons,” “Gotham,” and “Hamptons”), so this factor favors NMH.

Therefore, even though I doubt that the Defendants’ current use of the name NICHE HARTFORD for its local magazine seriously threatens NMH’s mark and reputation associated with its series of printed and online luxury lifestyle magazines, a balancing of the factors does tend to favor a finding of a likelihood of confusion.

However, while NMH may be able to stop the Defendants from using the “NICHE” mark in connection with their Hartford magazine, it might not be able to stop the Defendants from some of its other expanded uses of the word NICHE (for goods and services beyond its magazine).

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