Thursday, April 17, 2008

Planet Hollywood sues to stop local Las Vegas music band from using the name SUNSET STRIP

On April 16, 2008, OpBiz, LLC (“OpBiz”), the owner and operator of the Planet Hollywood Resort & Casino (“Planet Hollywood”) in Las Vegas, filed a trademark infringement lawsuit in the U.S. District Court for the District of Nevada against The Production Group, LLC (“TPG”) and its managing member, Glenn Medas, and Shay/Chambers, LLC d/b/a M/C Productions (“MC Productions”) and its managing member David Michael Chambers. See OpBiz, LLC v. Production Group, LLC et al, Case No. 08-cv-00482 (D. Nev. April 16, 2008). A copy of the complaint can be downloaded here.

The mark at issue is the name SUNSET STRIP for use by a live musical band.

OpBiz purchased the formerly bankrupt Aladdin Hotel and Casino in 2004 and began rebranding the entire hotel using the Planet Hollywood name. As part of this effort, OpBiz began developing ideas for the type of entertainment that would be offered in connection with the hotel under its new Planet Hollywood identity.

Sometime in early 2005, a decision was made for the hotel to have its own house band that would “symbolize the PLANET HOLLYWOOD brand – a high-energy, live music and entertainment group performing within the Planet Hollywood property.” OpBiz, supposedly in consultation with Defendants Medas and Chambers and after a clearance search was performed, chose to name this house band “The Sunset Strip Band.”

According to the complaint, OpBiz planned to use THE SUNSET STRIP BAND as a mark designating Planet Hollywood’s ubiquitous house band – and not meant as the name of a specific band. In correspondence between OpBiz and the Defendants, however, the Defendants claim that name was always meant to be for this specific band.

OpBiz hired the Defendants (TPG and MC Productions are in the business of staffing entertainers for various venues) to assemble a music band and dance group for THE SUNSET STRIP BAND, which had its first performance at Planet Hollywood on August 22, 2005.

The complaint notes the Defendants provided the performers and was in charge of what songs, music, and dance would be performed, but that OpBiz “controlled the overall production, including lighting, sound, and final approval on overall style and content.”

On September 28, 2005, OpBiz filed a Nevada state trademark application for the mark THE SUNSET STRIP BAND for “entertainment services rendered by a musical group.” On October 8, 2005, OpBiz filed a federal trademark application for the mark THE SUNSET STRIP BAND (“band” disclaimed) for “entertainment, namely live performances by a musical band.” The mark was registered on January 1, 2007.

The complaint asserts that OpBiz has spent “several hundred thousand dollars” promoting its entertainment services offered under its mark THE SUNSET STRIP BAND in print and broadcast media as well as online through its websites and that consumers have come to recognize Planet Hollywood as the source of the entertainment services offered under the name THE SUNSET STRIP BAND.

From August 2005 to June 2006, Defendants' performers performed regularly at the Planet Hollywood until supposedly they were notified that OpBiz was “temporarily discontinuing performances” while the venue where the band performed was being renovated. OpBiz acknowledges that it is not currently performing any entertainment services under the mark THE SUNSET STRIP BAND, but that it does have a “bona fide intent” to resume use after the renovations are completed.

According to the complaint, sometime in July 2006, Medas asked OpBiz for permission to use the name THE SUNSET STRIP BAND outside of Planet Hollywood for a period of six months so that Medas could help his performers finding another “gig.” Supposedly, OpBiz verbally agreed to such use and sent a written memo confirming such (although a copy of such memo cannot currently be found).

OpBiz maintains that the Defendants continued to use the mark in connection with a musical band and dance group long after the six months had expired. The Defendants registered the domain name in April 2006, but subsequently linked the domain to a website with information about Defendants' music and dance group. The Defendants continue to promote their group on TPG’s website and MC Productions’ website and have offered their services under the mark to other Las Vegas hotels.

On June 15, 2007, TPG filed its own Nevada service mark application for the mark SUNSET STRIP for “entertainment services, namely performers[sic] by singers, dancers, & musicians & related miscellaneous product[sic] and merchandise" and claiming first use date of August 15, 2005 (7 days prior to OpBiz's claimed first use date).

OpBiz contacted the Defendants on several occasions to demand that the Defendants stop using the SUNSET STRIP name and to cancel its Nevada state service mark. OpBiz contacted Medas by phone on June 22, 2007 and by letter three times (July 18, 2007, September 25, 2008, and October 16, 2007). Medas supposedly ignored the first three contacts, but responded to the October letter asking for OpBiz’s “authority” for its demands – and also mentioning that the name of the group was always SUNSET STRIP and always intended as the name of the group.

When OpBiz provided copies of its federal and state registrations, Medas, on April 3, 2008, responded by denying any infringement and maintained that there was no likelihood of confusion between OpBiz’s THE SUNSET STRIP BAND and its mark SUNSET STRIP.

The Defendants, under the name SUNSET STRIP (pictured below), are currently performing at the Las Vegas Hilton hotel and casino (link here), having secured a long-term contract to provide its musical entertainment services. See also here and here.

OpBiz’s causes of actions are for federal trademark infringement, false advertising, unfair competition/false designation of origin, cybersquatting, trademark infringement and deceptive trade practices under Nevada law, common law trademark infringement, and intentional interference with prospective economic advantage.

OpBiz seeks a preliminary and permanent injunction against the Defendants to stop them from performing under the name SUNSET STRIP and from registering any more domain names with the mark SUNSET STRIP (and ordering the transfer to OpBiz of domain name). OpBiz also seeks cancellation of TPG’s Nevada State service mark registration, a disgorgement of profits earned by the Defendants for any performances using the SUNSET STRIP mark, the usual damages (compensatory, consequential, statutory, and punitive damages) as well as interest, costs, and attorneys' fees.

The "Sunset Strip" performers

Vegas™Esq Comments:
Noticeably missing from the exhibits attached to the complaint is any type of agreement between OpBiz and both TPG and MC Productions memorializing the understandings of the parties back when the Defendants were first hired by OpBiz to help develop the show. Such agreement might also show what kind of understanding there was with respect to OpBiz’s promotion of the show.

One must always remember that a trademark registration, unless incontestable, is just “prima facie” evidence of the registrant’s ownership of the mark and registrant’s exclusive right to use the registered mark in commerce on or in connection with the goods or services specified in the certificate (see §7(b) of the Lanham Act, 15 U.S.C. §1057(b)). As such, a defendant faced with allegations of trademark infringement, but armed with some contradictory evidence to suggest that the registrant might not be the owner of the mark nor have the exclusive right to use the mark, has a fighting chance against such allegations.

One can imagine Medas and Chambers coming back with a different story that they were hired to come up with a band and worked with OpBiz executives to come up with a name for the ban that OpBiz felt was consistent with the Planet Hollywood brand and which also would not infringe any other trademark (thus the clearance search by OpBiz) – but with an understanding among the parties that the name was for Defendants' specific band, and not a Planet Hollywood house band as the complaint alleges.

Also curious is that OpBiz waited several weeks until after the first use of the name to apply to register the mark. If OpBiz was serious about using that name as a mark for a Planet Hollywood house band, why did it not file a Section 1(b) intent-to-use application right away? Perhaps because OpBiz did not think to even claim any ownership rights to the name at that time – and only after recognizing the popularity of the band that had been created by the Defendants did it seek to claim the exclusive right to that name.

Of course, to the extent that Medas claims that the name was always meant to be for Defendants’ band, evidence that Medas asked for permission to use the name following June 2006 could be quite detriment to the Defendants’ position. However, as the complaint acknowledges, there is no evidence of such “verbal agreement” yet (and the OpBiz executive who supposedly gave the consent to use the name is not even identified in the complaint). And if that purported memorandum is never found, then it will be a case of who do you believe between Medas and whomever Medas supposedly received permission from at OpBiz.

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