Caesars Palace Files Declaratory Judgment Action Over OCTAVIUS TOWER

In so many trademark lawsuit stories that grab the media’s attention, the story is often one of a large corporation enforcing its trademark rights against individuals and small businesses in a manner that is often described as “trademark bullying” (but which, of course, from the corporation’s perspective could be seen as zealous protection of the company’s valuable trademark rights). The story behind this lawsuit is quite the opposite – in this case, it is the large corporation that is being bullied (or more accurately, majorly inconvenienced since a large corporation has sufficient resources to fight a legal battle in court) by an individual that is seeking to enforce highly questionable trademark rights.

On April 8, 2011, Caesars World, Inc. (“Caesars”), the owner of the CAESARS PALACE brand of hotel-casinos (including Caesars Palace in Las Vegas), filed a declaratory judgment action against a German man named Marcel July and his Nevada limited liability company, Octavius Tower LLC, based on the defendants claims to have exclusive ownership rights to the mark OCTAVIUS TOWER and demands that Caesars stop using the name in connection with a hotel tower. See Caesars World, Inc. v. July et al, Case No. 11-cv-00536 (D. Nev. April 8, 2011). A copy of the complaint (with exhibits) can be downloaded here.

Back in 2007, Caesars World’s parent company, Harrah’s Entertainment, Inc. (which has since been renamed Caesars Entertainment Corporation) announced a $1 billion expansion of the Caesars Palace Hotel-Casino in Las Vegas. One of the new hotel towers built as part of the expansion was going to be named the “Octavius Tower” (going along with Caesars “Roman” themed hotel/casino – presumably named after Julius Caesar’s adopted nephew, Gaius Octavius [for you Roman history scholars, feel free to correct me]).

The Octavius Tower at Caesars Palace in Las Vegas

Two days after Caesars’ announcement regarding its plans to build Octavius Tower, Mr. July, being the enterprising fellow that he appears to be, decided to registered several domain names such as octaviustowercom; octaviustowers.com; octaviustowerlasvegas.com; and octaviustowerslasvegas.com. The same day, July also registered the domain namescaesarstower.com; caesarstowers.com; caesarspalacetower.com; caesarspalacetowers.com; and caesarspalacetowerslasvegas.com. The websites at those domain names promoted that “The new Caesars Palace Towers are Coming Soon” and that the domain names were for sale (see Exhibit B of the Complaint). Caesars filed domain name arbitration actions against July under the UDRP with respect to those domain names that incorporated the mark Caesars Palace (but chose not to go after the Octavius Tower domain names without any trademark registration). The domain names were transferred to Caesars after the arbitrator determined that the domain names had been registered in bad faith. See Caesars World, Inc. v Marcel July Ra Christian Kaldenhoff, Nat'l Arb. Forum, FA 0801001126341 (March 3, 2008).

On July 20, 2007, Caesars filed its own intent-to-use application for the mark OCTAVIUS TOWER for “hotel services.” The application was allowed by the PTO on January 29, 2008; however, because of well-publicized construction delays due to lack of funding after the major downturn in the economy (see news articles here and here), Caesars was not able to provide a Statement of Use before the January 29, 2011 deadline and the application went abandoned (although Caesars, anticipating that its original application would go abandon, filed a new application on December 10, 2010).

Of course, what happened during the interim? Mr. July filed his own trademark registration applications with the PTO for the mark Octavius Tower in connection with entertainment services – specifically on May 7, 2008, July filed for the mark OCTAVIUS TOWER for “Entertainment services, namely, providing a web site featuring musical performances, musical videos, related film clips and photographs”. A registration was issued September 1, 2009. [Query—given that Caesars was already aware of Mr. July propensity for opportunism as illustrated by his domain name registrations and the fact that the marks were identical, why didn’t Caesar file an Opposition against Mr. July’s applications when it had the chance?] On July 23, 2009, July filed a second application for OCTAVIUS TOWER for “Entertainment in the nature of visual and audio performances, and musical, variety, news and comedy shows; Presentation of live show performances; Theatrical and musical floor shows provided at discotheques and nightclubs; Theatrical and musical floor shows provided at performance venues.” A registration for this second application issued on January 12, 2010. In addition to these federal registrations, July also filed three Nevada state trademark registrations for the mark OCTAVIUS TOWER in connection with entertainment services (here, here, and here) as well as a Florida trademark registration. Caesars alleges in its complaint that July has not used the mark in connection with any of the entertainment services identified in the registration (while I have not reviewed the specimens of use submitted by July in order to get his marks registered, I would not be surprised if they are questionable on their face).

Given that the PTO allowed Mr. July’s applications to register despite Caesars pending application for OCTAVIUS TOWER for hotel services, one would naturally not expect Caesars second application for OCTAVIUS TOWER to encounter any objections from the PTO, right? Wrong. On February 24, 2011, the PTO issued a non-final office action rejecting Caesars new application on the basis of a likelihood of confusion with Mr. July’s registration. So what did Mr. July do once he learned of the rejection? He got an attorney to send a cease and desist letter to Caesars (see Exhibit D of the Complaint) demanding that Caesars stop using Mr. July’s “trademarked name” Octavius Tower in any manner and threatening to pursue “all legal remedies available to him.” Caesars counsel wrote back on March 21, 2011, arguing no likelihood of confusion and offering to enter into a coexistence agreement. On March 23, 2011, July’s attorney later wrote back rejecting the coexistence agreement and reiterating the threat to take legal action. Subsequently, July purportedly modified his website at http://www.octaviustower.com/ to add a page that includes Caesars' 2007 announcement of its plan to launch Octavius Tower and includes copies of the correspondence July’s counsel sent to Caesars along with the message to the public about Caesars “infringement” of July’s trademark rights:

Public awareness of this unacceptable corporate behavior is crucial to eradicating it and we are asking you to take a stand and make a difference on this issue. Your collective voice is more compelling than the lobbying power of corporate giants and it is a voice that cannot be ignored. Together we can make a difference and help keep our freedom intact, for us, for our children, and for our grandchildren.

Caesars, recognizing its opportunity to file a declaratory judgment action against Mr. July in order to redress this mess, filed the instant action. In addition to seeking declarations of non-infringement of Mr. July’s trademark rights, Caesars also seeks to cancel July’s federal and state trademark registrations on the basis of non-use and fraud.

So with all of Mr. July’s talk about enforcing his trademark rights, we shall see how important those marks truly are to him and how strongly he feels about his trademark rights (and the strenghth of such rights). Too many individuals seem to have this impression that registration of a particular mark is the end-all-be-all for solidifying exclusive rights to a particular term. But registration is merely prima facie evidence of trademark rights. If you don't actually have any underlying trademark rights to a mark (i.e., some associated goodwill that the consuming public associates with your mark and thegoods/serivces sold using the mark), then you will not be entitled to make a claim of exclusive rights to a term (especially against a third party using the mark in connection with a substantially differnet good or service).

And while I suspect that Mr. July may try to turn this dispute into a "David vs. Goliath" battle (as reflected by his website) of a large corporation using its corporate power and the legal system to steal his valuable trademark, this is one time where I side with the big company.

Casey’s Challenges Subway's Trademark Claim to FOOTLONG

As has been reported widespread in the media, last week, Casey's General Stores, Inc. (“Casey’s”), the owner of the convenience store chain Casey's General Store, filed a declaratory judgment action in Iowa federal district court against Doctor’s Associates, Inc. (“Subway”), the owner of the sandwich shop franchise Subway, seeking a declaration that the term “FOOTLONG” is generic when used in connection with a “footlong submarine sandwich” and thus Casey’s use of the term does not violate any trademark rights owned by Subway. See Casey's General Stores, Inc. v. Doctor's Associates Inc., Case No. 11-cv-00064 (S.D. Iowa February 11, 2011).

DuetsBlog provides a good blog post on the lawsuit filing (including a link to the complaint here). Other news coverage here, here, and here. Other blog coverage from Lawyers and Settlements and Trademarks and Brands.

Casey’s receipt of a cease and desist letter from Subway on January 31, 2011, regarding Subway’s claim over the FOOTLONG term apparently prompted Casey’s to file the action. In the complaint, Casey’s notes that in another pending lawsuit by Subway against convenience store chain Sheetz Inc. (see Doctor's Associates Inc. v. Sheetz Inc. et al, Case No. 09-cv-00088 (E.D. Va.)), the Court denied Subway’s early motion for a preliminary injunction and in doing so made the comment that the term “footlong” is “certainly generic.”

The complaint also notes that with respect to at least one of Subway’s applications for FOOTLONG (for restaurant services), the PTO has refused registration on the grounds that the mark is merely descriptive. In the PTO’s most recent Office Action (which included over 700 pages of exhibits), not only does the PTO note that the term “footlong” is commonly used, not only as an adjective to describe the size of sandwiches but also as a noun generically to refer to the sandwich itself and stating “Being potentially generic for applicant’s menu item, the mark FOOTLONG is highly descriptive for applicant’s restaurant services.” The PTO also noted numerous other restaurant menus, restaurant webpages, recipes, and articles using the term “footlong” to describe sandwiches and hot dogs that are one foot long and concluding that “Clearly, the evidence shows that the mark is and has been widely used descriptively, if not generically, in the food and restaurant industries for many years.”

Of course, as noted by DuetsBlog, the real question is how did Subway ever get its other FOOTLONG application (for sandwiches) to the publication phase? Numerous oppositions have been filed by companies including Long John Silvers, A&W, Taco Bell, Kentucky Fried Chicken, Dairy Queen, and Pizza Hut – with all but one suspended. The opposition that appears to be moving along is (not so coincidentally) the opposition filed by Sheetz. See Sheetz of Delaware, Inc. v. Doctor’s Associates, Inc., Opposition No. 91192657 (T.T.A.B.)

As for how the FOOTLONG application for "sandwiches" ever got the past the examination phase to the publication phase, not even the prosecution history provides a clear answer on that. In response to a descriptiveness refusal by the PTO, Subway merely argued “When applying the mark FOOTLONG to sandwiches it would require imagination, thought or perception to reach a conclusion as to the nature of those goods or services.” Subway added some sales figures in its Office Action response in order to make a claim for acquired distinctiveness if needed – but it never became an issue because the PTO, after dealing with the refusal discussed below, simply moved the application along to the publication phase.

Interestingly, it was not a descriptiveness refusal, but rather a likelihood of confusion refusal, that was Subway’s primary obstacle towards publication of its FOOTLONG application. In the PTO's office action, the Examining Attorney also cited the registered marks FOOTLONG EXPRESS (here and here) in support of a likelihood of confusion rejection. Subway was only able to get its application approved after winning by default cancellation actions against the marks FOOTLONG EXPRESS. See Doctor’s Associates, Inc. v. Skyline Chili, Inc., Cancellation No. 92050678 (T.T.A.B.).

But even after the cited marks had been canceled, the Examining Attorney still received a 72 page Letter of Protest on July 24, 2009 (which would have only been forwarded to the Examining Attorney if the PTO felt that the information raised important issues for the Examining Attorney to consider). While there is a notation in the file that the evidence was reviewed, the application was still forwarded for publication (and the approval itself would have certainly undergone the usual supervisory review, so the approval cannot be blamed on a single Examining Attorney). The rest is history (in the making). One suspects that the PTO, recognzing its mistake to have approved for publication the "sandwiches" application, went above and beyond in order to support its refusal of the "restaurant services" application.

Is there anybody out there that honestly believes that Subway is going to win this on any level?

Of course, this whole blog post was really just to give me an excuse to mention what I am reminded of when I hear the term “footlong” – a scene from the 80s Tom Hanks comedy “Bachelor Party” involving a male stripper who goes by the name “Nick the Dick.” If you watch this clip (sorry in advance for the 30 sec ad at the beginning) from the movie, at about the 1:30 mark, the lady asks “Is that footlong?” to which the gentleman replies “…and then some.” [A little bit of nostalgia for you Gen-Xers out there. . . in addition to being evidence that consumers recognize the term as a generic reference to the “size” of a “sandwich” (or at least a hot dog anyway).]

The latest Facebook trademark dispute - Lamebook

Facebook’s aggressive trademark enforcement efforts against any third party use of trademarks using “–book” (or “face-“) have been well documented in the media (most recently, Teachbook) (articles here, here, and here among many). A review of the Trademark Trial and Appeal Board filings by Facebook also documents the number of trademark applications involving the word “book” or “face” that Facebook has opposed.

Yesterday, the website Lamebook, which prides itself on finding and reposting amusing pictures and status updates (along with “other gems”) found on social networking websites like Facebook and Twitter, decided to be proactive and filed a declaratory judgment action in the face of a cease and desist letter from Facebook seeking a declaration of non-infringement and non-dilution. See Lamebook, LLC v. Facebook, Inc., Case No. 10-cv-00833 (W.D. Tex. November 4, 2010). Techcrunch reports on the lawsuit (and provides a copy of the complaint).

Lamebook’s position is that its use of the mark Lamebook is protectable parody. So naturally, Facebook’s position will be that its mark is famous (not an unreasonable position) and that this mark causes a likelihood of dilution (ask Louis Vuitton about the viability of this position). Of course, as described in this prior blog post regarding a different parody mark, the online nature of the services offered by both Facebook and Lamebook may make the case more suitable for a traditional likelihood of confusion analysis.

Copyright, Meet Trademark.

US Copyright Group (“USCG”) is a newly established company which, like Las Vegas’ own (and now infamous) Righthaven, seeks to enforce copyright rights through the filing of mass lawsuits. The company, which purports to represent the copyright interests of motion picture producers and distributors, grabbed news headlines this year with its mass lawsuits against “Doe” individuals suspected of illegally downloading movies using bittorent. See articles here, here, and here.

USCG now finds itself facing a lawsuit . . . in the trademark realm. On October 11, 2010, a company named Media Copyright Group, LLC (“MCG”) filed a declaratory judgment action against Legacy 21, LLC (“Legacy”), in the U.S. District Court for the Northern District of Illinois. See Media Copyright Group, LLC v. Legacy 21, LLC, Case No. 10-cv-06498 (N.D. Ill.). A copy of the complaint can be downloaded here.

According to the complaint, Legacy does business using the name USCG under a purported license from the owners of the registered (on the Supplemental Register) service mark US COPYRIGHT GROUP for “Providing worldwide copyright enforcement and protection services, namely, assisting copyright holders prevent copyright infringement and recover losses due to copyright infringement”) (“COPYRIGHT” disclaimed), which is jointly owned by two LLCs, Screaming Eagle LLC and Red Eagle LLC [ed.—hmm, joint ownership?].

Interesting sidenote, the trademark applicants stated that the term “US” in the mark is intended to mean the pronoun that is the objective form of "we" rather than implying an association with the United States (U.S.) -- and argument that the PTO rejected in part based on the fact that the mark as used on the speciment and on the applicants' website indicated that the term “is used to indicate the United States not the object case of 'we' . . . applicant consistently uses the term in upper cases rather than 'Us' or 'us.'” [ed.—oops. Trademark Lesson -- always review your client's website before making any assertions like this on the client's behalf.] (Would also be interesting to know if when you contact USCG's offices, do they call themselves the “Us Copyright Group” or the “U S Copyright Group”? Of course, try finding a contact number for USCG online – very clandestine organization with most roads leading back to USCG’s counsel, Dunlap, Grubb & Weaver, PLLC.)

MCG, operating under the name Media Copyright Group, also provides copyright-related services to adult entertainment media companies On October 8, 2010, counsel for Legacy sent MCG a cease and desist letter alleging that MCG’s use of the name Media Copyright Group constituted trademark infringement of Legacy’s trademark rights to the name US Copyright Group and that MCG’s registration of the domain name http://www.mediacopyrightgroup.com/ constituted cybersquatting. Legacy demanded that MCG cease doing business under the name Media Copyright Group and pay Legacy $25,000 [ed.—interesting choice of dollar amount].

MCG, not missing an opportunity to gain the home court advantage (and probably recognizing that if it did not act fast, USCG would not hesitate to file its own legal action given its record of filing lawsuits), immediately filed the instant action against USCG seeking a declaration that its use of name Media Copyright Group and the website http://www.mediacopyrightgroup.com/ did not infringe USCG’s trademark rights.

MCG’s complaint also includes a cause of action for cancellation of the US COPYRIGHT GROUP Supplemental Registration based on purported fraud on the U.S. Patent and Trademark Office – although the supposed fraudulent statements focused upon in the complaint appear to be arguments that the mark was not descriptive or generic. Yet, in that same office action, the mark was amended to be registered on the Supplemental Register instead of the Principal Register. Thus, the PTO, by allowing the mark to issue of the Supplemental Register, clearly did not rely upon such fraudulent statements regarding the mark’s non-descriptive nature in allowing the mark to register. Indeed, the fact that the mark did not register on the Principal Register is further evidence that the mark is merely descriptive and USCG must rely upon its common law trademark rights in taking any action against potential infringements (including having to show some degree of acquired distinctiveness for its admittedly descriptive mark). (For some background regarding supplemental registrations, see INTA’s article entitled “U.S. Trademark Registrations: Principal Register vs. Supplemental Register”; see also prior blog posts here and here).

Does it surprise anyone that a company that has no qualms in filing mass copyright infringement lawsuits would seek to aggressively enforce its own trademark rights, however extremely weak such trademark rights may be? Now that MCG has called USCG’s bluff and gone on the offensive, how much longer will USCG want to continue to fight what is almost certainly a losing battle? A lot may depend on MCG’s willingness to fight its battle (as many of us know, it’s not enough to be legally right, one must have the financial resources to prove such in court). One wonders if USCG now regrets asserting such rights in the first place.

Juicy Trademark Dispute Over SMASHBURGER

Icon Burger Development Company, LLC (“Icon”), the owner of the burger chain “Smashburger,” filed a declaratory judgment action in U.S. District Court for the Eastern District of Kentucky against Dairy Cheer Stores Inc. (“Dairy Cheer”), the owner of several “Dairy Cheer” restaurants in Kentucky. See Icon Burger Development Company, LLC v. Dairy Cheer Stores Inc., Case No. 10-cv-00345 (E.D. Ky. Filed September 29, 2010). A copy of the complaint can be downloaded here (via Courthousenews.com).

The dispute centers around the name SMASHBURGER. Icon began its SMASHBURGER restaurant chain in June 2007 and now has locations in major urban cities in 16 states (including right here in Las Vegas). Icon holds trademark registrations for the SMASHBURGER word mark and design mark (pictured above) in connection with restaurant services.

Dairy Cheer operates four soft-serve ice cream stands/fast food restaurants in the State of Kentucky under the name “Dairy Cheer” – the name came from the fact that the first restaurant opened by Dairy Cheer was a former “Dairy Queen” restaurant that was rebranded “Dairy Queen.” Specifically, Dairy Cheer restaurants are located in the rural areas of Pikeville, Carlisle, West Liberty and Prestonsburg, Kentucky.

Relevant to the instant dispute is that part of Dairy Cheer’s storefront signage for its restaurants states “Home of the Smashburger” – with “Smashburger” identifying one of Dairy Cheer’s menu items.

What prompted the dispute is that Icon notified Dairy Cheer earlier this year about its plans to open a “Smashburger” store in Lexington, Kentucky. Not surprisingly, Dairy Cheer, recognizing that it did have some limited prior user rights to the name “Smashburger,” saw this as an opportunity to get a big windfall from a nationwide company with deep pockets that was eager to use the name for a Kentucky-based location. According to the complaint, representatives of Dairy Cheer demanded a “substantial monetary payment” from Icon to settle the dispute over Icon’s Lexington SMASHBURGER location.

Icon apparently refused to give in to Dairy Cheer’s demands, and so on June 18, 2010, Dairy Cheer filed a Petition for Cancellation with the Trademark Trial and Appeal Board to cancel Icon’s SMASHBURGER word mark registration. See Dairy Cheer Stores Inc. v. Icon Burger Development Company, LLC, Cancellation No. 92052579 (Filed June 18, 2010). Dairy Cheer claims that Icon’s registration of the SMASHBURGER mark for restaurant services so resembles Dairy Cheer’s common law trademarks SMASHBURGER and HOME OF THE SMASHBURGER (which Dairy Cheer claims go back to 1992) as to cause a likelihood of confusion, and thus the registration should be canceled.

With Icon’s federal action seeking a declaratory judgment that its use of SMASHBURGER does not infringe any trademark rights held by Dairy Cheer, the dispute now moves to a federal court (and the Cancellation will certainly be suspended pending the outcome of the civil case).

Sidenote: For those of you who live in a city which has a “Smashburger” location (Icon's “Smashburger” -- not Dairy Cheer's “Smashburger”), I highly recommend giving it a try. It’s rare that a new restaurant chain impresses me with its food offerings, especially hamburgers. After having eaten a fair share of “so-so” and “ok” hamburgers for many years, Smashburger reminded me that, when prepared properly, an ordinary hamburger can be incredibly delicious. I consider the burgers made by Smashburger to be the best tasting hamburgers I’ve ever eaten . . . so far anyway (although hamburger connoisseurs wanting to judge my credibility for judging hamburgers should know that I am one of the few people in the world that does not like hamburgers from In-N-Out Burger – and it has nothing to do with their overly aggressive trademark enforcement).

District Court finds that Casino De Monte Carlo owner has no enforceable trademark rights to CASINO DE MONACO

The Casino de Monte Carlo in Monaco

A New York District Court has determined that the owner of the Casino De Monte Carlo does not have enforceable trademark rights in the mark CASINO DE MONACO and has granted summary judgment in favor of a UK company that had been sued for trademark infringement and cybersquatting over its use of the name GRAND MONACO CASINO in connection with an online casino. See In re. Casino de Monaco Trademark Litigation, 2010 U.S. Dist. LEXIS 33950 (S.D.N.Y. March 31, 2010).

Societe des Bains de Mer et du Cercle des Etrangers a Monaco’s (“SBM”) is the operator of all casino properties in the Principality of Monaco, most notably the Casino De Monte Carlo. Playshare PLC (“Playshare”) is a UK company that acquired an online casino that has used or is using various online designations including GRAND MONACO, GRAND MONACO CASINO, GRAND MONDIAL and GRAND MONDIAL CASINO and related domain names.

SBM holds a U.S. trademark registration for the mark CASINO DE MONACO for “providing casino services within a hotel resort environment” which issued on December 20, 2005, under Section 44(e) of the Lanham Act based on SBM’s registration of the mark in Monaco but also with a claim of acquired distinctiveness based on Section 2(f) of the Lanham Act. SBM also has a second application pending for CASINO DE MONACO for “casino services” but that application (filed in the midst of the dispute at issue) has been opposed by Playshare. See Societe Anonyme Des Bains De Mer Et Du Cercle Des Etrangers v. PlayShare PLC, Opposition No. 91188636 (T.T.A.B. Filed Jan. 30, 2009).

On March 21, 2007, SBM filed a Uniform Domain Name Dispute Resolution Policy (“UDRP”) complaint with the World Intellectual Property Organization (“WIPO”) against the approximately 65 domain names that Playshare acquired as part of the online casino it acquired which included the words “grand” and/or “monaco” with “casino” as part of a URL that led to Playshare’s online casino. In response to SBM’s UDRP complaint, Playshare made a decision to change the name of its online casino to GRAND MONDIAL and even registered the name as a trademark (although the opinion is not clear where the mark was registered and no records appear with the PTO). Despite the name change, SBM continued forward with its claims regarding the “monaco casino” domain names. On May 25, 2007, the WIPO arbitration panel decided in favor of SBM finding Playshare’s domain names confusingly similar to SBM’s trademark and ordered Playshare’s domain names transferred to SBM. See Société des Bains de Mer et du Cercle des Etrangers à Monaco v. Lucan Toh and Max Wright, Case No. D2007-0249 (WIPO May 25, 2007).

On June 6, 2007, SBM sued Playshare alleging that Playshare’s use of the aforementioned names and domain names infringed its trademark rights to the mark CASINO DE MONACO, including even Playshare’s new name GRAND MONDIAL. On June 19, 2007, Playshare filed its own declaratory judgment action against SBM in Arizona district court seeking a declaratory judgment that its use of the domain names did not violate the Anticybersquatting Consumer Protection Act (“ACPA”) and that SBM’s registered mark for CASINO DE MONACO is invalid and unenforceable. The Arizona action was consolidated with the New York action and Playshare’s declaratory judgment causes of actions were treated as counterclaims.

Both sides filed cross motions for summary judgment. The Court denied SBM’s motion and granted Playshare’s motion with respect to SBM’s claims and Playshare’s counterclaims related to CASINO DE MONACO.

The court first addressed the validity of SBM’s CASINO DE MONACO mark. Playshare argued that despite SBM’s registration of CASINO DE MONACO, SBM has no protectable rights under the Lanham Act in its mark since it does not provide any goods or services using the mark in the U.S. SBM does not operate an on-line gaming business, does not operate any casinos in the U.S and has no casino by the name of Casino de Monaco

Nonetheless, SBM argued that it did use the mark as a service mark in the U.S. in connection with an established business or trade.SBM focused on its New York subsidiary that engages in “sales offerings” to U.S. residents of casino services at SBM’s casinos in Monaco. SBM also contended that the name CASINO DE MONACO is an umbrella term for all its Monaco-based casinos, that the mark is used on SBM’s website and verbally when promoting its casino and casino-related services, and that CASINO DE MONACO is a nickname for the Casino de Monte-Carlo, and many people, including Americans, use the name CASINO DE MONACO to refer to the Casino de Monte-Carlo “which embodies tremendous goodwill, glamour, elegance and style in the gaming industry.”

In the end, however, the court rejected SBM’s arguments and concluded that SBM’s activities in the United States relating to SBM’s mark CASINO DE MONACO did not constitute “services” within the meaning of the Lanham Act (services that are not “solely for the benefit of the performer” but rather services “rendered to others”). The court also rejected SBM’s attempt to conflate its CASINO DE MONACO mark with its more established CASINO DE MONTE-CARLO service mark. CASINO DE MONACO is not an actual casino unlike Casino de Monte-Carlo. The court also noted that “any secondary meaning that the mark CASINO DE MONACO can acquire vis-a-vis the use of the mark CASINO DE MONTE-CARLO is limited by the fact that SBM is in an on-going dispute with U.S.-based Victoria Partners over the Monte-Carlo designation when used with the casino business. Without some resolution, the mark CASINO DE MONTE-CARLO can be reasonably construed as not “identifying a single source of origin.” (italics in original). [For prior blog posts on this ongoing dispute, click here and here].

The court noted that SBM’s Section 44(e) based registration only required it to affirm that it had a bona fide intent to use its foreign registered mark. The court went on the state:

However, regardless of SBM’s intent, which is disputed, SBM has not used the mark in any meaningful way anywhere. And SBM has not shown that it has used the mark in the United States at all. SBM argues that its “U.S. based direct sales activities represent ‘material aspects’ of SBM’s casino business...and thus are properly considered ‘services...rendered in commerce.” for SBM’s mark CASINO DE MONACO. However, the record is devoid of evidence that would create a genuine issue of material fact that SBM uses the mark CASINO DE MONACO to identify its services, anywhere, but particularly in the United States. First, there does not exist in Monaco, or anywhere else, a casino identified by the name Casino de Monaco. Nevertheless, SBM asserts that the mark CASINO DE MONACO is: (1) used as a nickname or moniker for Casino de Monte-Carlo; (2) employed on casino website(s); and (3) an umbrella term/brand to refer to SBM’s five casinos in Monaco. However, all that SBM can show to support these representations are self-serving affidavits. Even if this claimed use of the mark CASINO DE MONACO was not insignificant on this record, which it is, all of its use of the mark occurs outside of the United States. There is no real evidence that the claimed nickname/moniker/umbrella term that signifies CASINO DE MONACO has ever existed in the United States.

(internal citations omitted) (emphasis in original).

Furthermore, regarding the one example that SBM could show of use in the United States of the mark CASINO DE MONACO on SBM’s own website, it turns out that such webpages were created on or after April 14, 2008 (almost a year after the lawsuit was filed) and SBM did not show any evidence that anyone in the U.S. ever viewed the pages. The court added that “[i]t does not bolster SMB’s [sic] position that all activity SBM engages in the United States amounts to nothing more than advertising and promotion of SBM’s operations outside the U.S., i.e., in Monaco. What is clear is that there is no evidence on the record that this limited activity ever implicated the mark CASINO DE MONACO.” (emphasis in original).

The court decided that SBM’s “utter lack of use of the mark CASINO DE MONACO anywhere, let alone in the United States,” required it to refuse to enforce any purported trademarks rights by SBM in the mark. Accordingly, the court did not have to engage in any likelihood of confusion analysis. The court did find enough limited activity to protect SBM’s purported right to the unregistered mark CASINO DE MONTE-CARLO because SBM actually utilizes that mark in the United States – but since SBM’s complaint did not allege any infringement of this mark, such rights were irrelevant for purposes of deciding the motions.

Based on its determination that SBM held no enforceable trademark rights to the mark CASINO DE MONACO, the court granted summary judgment on Playshare’s declaratory judgment causes of actions direct to SBM’s CASINO DE MONACO mark. The court found SBM’s trademark registration for CASINO DE MONACO invalid and unenforceable and ordered it to be canceled. The court further granted Playshare’s Motion for Summary Judgment on all of SBM’s federal claims based on the CASINO DE MONACO mark (and choosing to dismiss all state claims by declining to exercise supplemental jurisdiction). Moreover, the court declared that Playshare’s use of the designations GRAND MONACO, GRAND MONACO CASINO, GRAND MONDIAL CASINO and GRAND MONDIAL does not infringe on SBM’s (now cancelled) mark CASINO DE MONACO. Finally, because SBM’s entire basis for its cybersquatting claim was based on rights to the mark CASINO DE MONACO and since the mark was found invalid and unenforceable, then, as a matter of law, Playshare cannot be in violation of the ACPA with respect to its domain names. The court vacated the WIPO decision and ordered the domain names to remain with Playshare.

Judge Allows Ozzy Osbourne to Continue Lawsuit Over BLACK SABBATH

Back in June 2009, I wrote (link here) about the lawsuit filed by Ozzy Osborne against Tony Iommi over the rights to the BLACK SABBATH name. Ozzy’s lawsuit sought a declaration that he is at least a joint owner of the BLACK SABBATH mark (after rejoining the band in 1997 and revitalizing the brand) and that Iommi is not the sole owner of the mark as well as a cancellation of the BLACK SABBATH federal registration that Iommi currently owns on the basis that Iommi, when he filed the application in March 1999, made a knowingly false statement to the PTO when he declared that no other person had any right to use the BLACK SABBATH mark in commerce.

Today, the New York Post reported that District Court Judge John Koeltl ruled in favor of allowing Ozzy to move forward with his suit – while at the same time urging the parties to resume mediation in order to resolve the case instead of proceeding to trial. No other details have been reported. Other coverage by Blabbermouth.net.

So it looks like the Iron Man will Rock On.

Smiley Company Frowns On Court’s Decision to Deny Motion to Dismiss

An Illinois district court has denied a motion to dismiss filed by Franklin Loufrani and The Smiley Company SPRL (together “Smiley”) seeking dismissal of numerous counterclaims brought by Wal-Mart Stores, Inc. (“Wal-Mart”) in Smiley’s action under 15 U.S.C. § 1071(b)(1) seeking judicial review of the Trademark Trial and Appeal Board’s (“TTAB”) final decision dismissing Smiley’s opposition to Wal-Mart’s trademark application. See Loufrani et al v. Wal-Mart Stores, Inc., 2009 U.S. Dist. LEXIS 105575 (N.D. Ill. Nov. 12, 2009). For background on the long running dispute and the TTAB decision leading up to the lawsuit by Smiley, see my prior blog post here and John Welch’s post on The TTABlog®.

At the TTAB level, the Board dismissed Smiley’s opposition of Wal-Mart’s application to register its Mr. Smiley Mark (the “Wal-Mart Mark”) and sustained Wal-Mart’s opposition of Smiley’s intent-to-use applications (here and here) for Loufrani’s Smiley Face Design (the “Loufrani Mark”) on the basis that the Wal-Mart Mark had acquired a secondary meaning, the Loufrani Mark had not acquired distinctiveness and so could not be registered, and that Smiley’s use of the Loufrani Mark in certain classes of goods would create a likelihood of confusion with the Wal-Mart Mark.

Rather than appeal the TTAB’s decision to the Federal Circuit, Smiley filed a district court action under Section 21(b)(1) of the Lanham Act (15 U.S.C. § 1071(b)(1)) seeking judicial review of the TTAB’s decision. Smiley sought an order declaring its mark to be distinctive, reversing the TTAB’s decision finding a likelihood of confusion, directing the PTO to issue a Notice of Allowance for its applications, and reversing the TTAB’s decision finding that the Wal-Mart Mark had acquired distinctiveness. In response, Wal-Mart filed a six counterclaims: Count I sought a declaratory judgment that the TTAB’s decision was correct, Counts II-IV sought a declaratory judgment that Smiley’s use or licensing of the Loufrani Mark would constitute trademark infringement under federal and common law, and Counts V-VI sought a declaratory judgment that Smiley’s use or licensing of the Loufrani Mark would violate Illinois’ Deceptive Trade Practices Act and Consumer Fraud and Deceptive Business Practices Act.

Smiley moved to dismiss Counts II-VI on the basis that Counts II-VI presented no case or controversy. Smiley also argued that Counts II-IV should be dismissed because the limited scope of this Court’s review of the TTAB’s decision would make the court’s determination of the issue of trademark infringement an improper advisory opinion. Finally, Smiley moved to dismiss Count VI on that basis that Wal-Mart failed to plead that it suffered actual damages as required under the Illinois statute.

With respect to Smiley’s argument that Wal-Mart’s counterclaims presented no case or controversy, the Court, taking all of the facts in Wal-Mart’s counterclaims in the light most favorable to Wal-Mart, concluded that Wal-Mart had plead sufficient facts establishing the existence of a justiciable controversy. In each of Wal-Mart’s counterclaims, Wal-Mart alleges that if Smiley were to begin to use the Loufrani Mark (the application for which identifies hundreds of goods and services identical to goods and services offered by Wal-Mart in its retail stores), it would create a likelihood of confusion with Wal-Mart’s use of its Wal-Mart Mark.

The court, however, took the common sense approach in determining whether an actual controversy exists by noting that “the primary evidence of a substantial controversy here is the case itself: that is, that the parties have numerous claims against one another over similar smiley-face marks that both desired to register with the PTO.” The court also noted that the parties had already developed clear positions on the issue of infringement, thereby further demonstrating a substantial controversy and adverse legal interests of the parties.

With respect to Smiley’s argument that Wal-Mart’s Counts II-IV would constitute an advisory opinion, Smiley argued that Wal-Mart’s trademark infringement counterclaims inappropriately seek to have the court, in reviewing the TTAB’s decision regarding likelihood of confusion, decide whether hypothetical use of the Loufrani Mark constitutes trademark infringement.

The court noted, however, in a district court’s review of a decision by the TTAB, the district court may rule on the issues of likelihood of confusion and trademark infringement under the Lanham Act (citing CAE, Inc. v. Clean Air Engineering, Inc., 267 F.3d 660, 664, 678 (7th Cir. 2001)). The court added that, under the broad jurisdictional powers conferred by the Lanham Act upon district courts (citing Steele v. Bulova Watch Co., 344 U.S. 280, 283-84 (1952)), it may affirm the TTAB’s explicit finding of likelihood of confusion and apply it to render a declaratory judgment that Smiley’s actions would violate the Lanham Act or common law.

In addition, because the court’s review of the TTAB’s decision is both an appeal and an independent action, the parties are allowed to submit new evidence and request additional relief. Accordingly, Wal-Mart, in its counterclaims, may request additional relief not specifically rendered by the TTAB. Finally, the court noted that because Wal-Mart’s counterclaims arise out of the same transaction or occurrence as Smiley’s claims (i.e., the same trademark oppositions and the TTAB’s findings with respect to both parties), Wal-Mart’s counterclaims are compulsory under Fed. R. Civ. P. 13(a)(1).

Finally, with respect to Wal-Mart’s Count VI, the court noted that it is impossible for a claimant seeking a declaratory judgment that a future act would violate Illinois’ Consumer Fraud and Deceptive Business Practices Act to plead damages since no violation would have yet occurred. And based on Wal-Mart’s showing of a substantial controversy between Smiley and Wal-Mart as to the issue of likelihood of confusion underlying all of Wal-Mart’s counterclaims, including Count VI, the court held that Wal-Mart has adequately pled its allegations in Count VI so as to survive a Motion to Dismiss.

As such, the court denied Smiley’s Motion to Dismiss.

Weekly Wrapup of Nevada District Court Trademark Lawsuits

It was a busy week for trademark related lawsuit filings in the U.S. District Court for the District of Nevada (and not a single one of them filed by me).

Price Products, LLC v. Juvenile Solutions, Inc., Case No. 09-cv-02067 (D. Nev. October 27, 2009) (Complaint).

The owner of the DRIPSTIK ice cream/frozen treat holder (pictured above) sues for trademark and trade dress infringement over a knockoff product sold under the name FUN STIK by former Canadian distributor Petite Creations through Petite’s American distributor, Juvenile Solutions. Price Products discovered the products being marketed by Juvenile Solutions at an exhibitor’s booth at the ABC Kids Expo held on September 13-16, 2009, at the Las Vegas Convention Center (which is the only reason why an Idaho LLC is apparently suing a California corporation in Nevada district court).

M Holdings, LLC et al v. Hu Mei Lei, Case No. 09-cv-02071 (D. Nev. October 27, 2009) (Complaint) (Las Vegas Sun Article).
Las Vegas’ newest hotel and casino, The M Resort, files cybersquatting action against Chinese resident Hu Mei Lei over the website wwwmresort.com registered September 5, 2009, and purportedly featuring “provocative images of women” initially and changed thereafter to a typical pay-per-click landing page with links to discount hotel websites.

Rolex Watch U.S.A., Inc. v. Ryska et al, Case No. 09-cv-02093 (D. Nev. October 29, 2009) (Complaint) (Las Vegas Sun Article).

Rolex sues Las Vegas residents Angelika Ryska and Robert Mayer for counterfeiting over their sale of “replica” Rolex® watches through their website moreaffordable4u.com.

Mellow Beverage Co., LLC v. Nounna et. al, Case No. 09-cv-02090 (D. Nev. October 29, 2009) (Complaint) (Las Vegas Sun Article).

A company which sells a “relaxation and sleep aid” beverage under the unregistered trademark MELLOW (pending trademark applications here and here) filed a trademark infringement lawsuit against Shannon N. Nounna and Beverage Concepts, Inc. over a similar type of relaxation beverage using the name MELLOW (pictured below) (pending trademark application here) that Beverage Concepts is apparently launching soon.

CityCenter Land, LLC v. Papillon Airways, Inc. et al, Case No. 09-cv-02088 (D. Nev. October 29, 2009) (Complaint) (Las Vegas Sun Article).

The owner of the massive CityCenter project in Las Vegas is seeking a declaratory judgment that its proposed use of the name PAPILLON (pending trademark applications here and here) for one of CityCenter’s high-end retail stores located at CityCenter’s 500,000 square foot retail complex called “Crystals at CityCenter” does not infringe on the trademark rights of Papillon Airways, Inc. and Monarch Enterprises, Inc. which use the PAPILLON mark in connection with helicopter and bus tour services.

On September 3, 2009, Papillon Airways’ counsel sent a cease and desist letter to CityCenter, citing Paillion Airways’ trademark registration for PAPILLON for various goods and services (e.g., bumper stickers, clothing, helicopter and bus tour services) and claiming that CityCenter’s use of PAPILLON (logo version pictured above) is likely to lead consumers to believe there is an affiliation with Papillon Airways’ goods and services. CityCenter’s response is that Papillon Airways misrepresents the scope of its rights to the PAPILLON mark, which is always used in connection with “Grand Canyon Helicopters” (as pictured below), and thus the second claim for relief for misrepresentation.

Aloha Medicinals, Inc. v. Birkdale Medicinals, Inc., et al, Case No. 09-cv-00639 (D. Nev. October 29, 2009) (Complaint).

A convoluted lawsuit involving claims by Aloha Medicinals, a manufacturer of dietary supplements for people and pets, against former authorized distributor Birkdale Medicinals and one of its officers, Anthony “Tom” Peters, arising from Birkdale Medicinals’ apparent relabeling of Aloha Medicinals’ products to make it appear as if the products were Birkdale Medicinals’ own branded products. There are also claims relating to use of Aloha Medicinals’ copyrighted website, clinical and technical data for Aloha Medicinals’ products (used by Defendants as data for their products), using Aloha Medicinals’ unregistered trademarks as metatags and Google Adwords, and intentional misrepresentation regarding broken promises over special packaging provided by Aloha Medicinals to Birkdale Medicinals.

Las Vegas Tropicana Hotel & Casino Files Nevada State Court Declaratory Relief Action to Keep Using the TROPICANA Name

Las Vegas Sun reporter Steve Green reports (link here) on the brewing internal battle over the TROPICANA name.

It is a complicated story arising from the bankruptcy and reorganization of the company that owned Tropicana casinos in Las Vegas, Atlantic City, and throughout the United States and involving the competing interests of two different credit facilities. As part of the reorganization plans, one of the spun off companies received ownership of the “Tropicana” name while a second company, the one that would take over the actual Tropicana Hotel and Casino in Las Vegas (“TropicanaLV”), would be required to pay an annual license fee of $2 million to keep using the “Tropicana” name for the next five years.

The company that apparently now owns the TROPICANA trademarks and service marks (Tropicana Entertainment Holdings, LLC) recently filed two trademark applications for the design mark THE TROP LAS VEGAS EST. 1957 (pictured below) for casino services and for hotel, bar, and restaurant services.

Tropicana Las Vegas (est. 1957)

TropicanaLV – the “Tropicana” that was established in Las Vegas in 1957 – sees these trademarks filing as a threat in that it believes that the company which received the TROPICANA name in the reorganization is planning to eventually cut off TropicanaLV’s right to use the name TROPICANA. And so TropicanaLV is fighting back with a lawsuit in Clark County District Court seeking a declaratory judgment that TropicanaLV continues to have rights to use the TROPICANA name in connection with its hotel and casino (and indeed never even transferred those rights over).

Of course, because the mess is still in the jurisdiction of the bankruptcy court, Tropicana has filed a motion with the Delaware bankruptcy court to get confirmation that its lawsuit is not subject the stay or to ask that the stay be annulled for such action.

The history of the Tropicana and the details behind the 2008 bankruptcy and reorganization detailed in the complaint make for some great reading (for those of you interested in that sort of thing).

The Las Vegas Review Journal has its own article on the dispute (link here).

Update: Pamela Chestek over at Property, intangible provides her own detailed and insightful analysis of the dispute.

Wynn Resorts Files Declaratory Judgment Action Over XS

On July 13, 209, Wynn Resorts Holdings, LLC (“Wynn Resorts”), the sole member of Wynn Las Vegas, LLC, which owns and operates the Wynn Las Vegas casino hotel and resort, filed a declaratory judgment action against NYLO Hotels, LLC (“NYLO”), in the U.S. District Court for the District of Nevada. See Wynn Resorts Holdings, LLC v. NYLO Hotels, LLC, Case No. 09-cv-01258 (D. Nev. July 13, 2009). A copy of the complaint can be downloaded here.

For those outside Las Vegas, the Encore Las Vegas is the latest hotel project by well-known hotel/casino developer Steve Wynn. As part of Encore, Wynn decided to develop a restaurant/bar/nightclub named XS. And as any good businessman does, Wynn filed for trademark protection for the mark XS (one application for night club services and one for restaurant and bar services – both filed February 4, 2008).

Wynn’s applications hit an initial stumbling block when its applications were rejected on the basis of likelihood of confusion over the registered (and incontestable) mark XS owned by XS Entertainment, Inc. ( for “entertainment in the nature of indoor and outdoor amusement complexes” and “restaurant services, namely, restaurant and bar services.”). The same office action noted that there was one other pending intent-to-use trademark application for XS filed by NYLO with an earlier effective filing date.

Wynn was able to overcome the likelihood of confusion rejection by simply acquiring the registered mark from XS Entertainment, Inc. (with all of its correspondence goodwill of course) Of course, if XS Entertainment knew that it was Wynn seeking the mark, XS Entertainment might jack up the price – and so Wynn had The Treadstone Group acquire the mark on July 18, 2008 on Wynn’s behalf and The Treadstone Group subsequently assigned the mark to Wynn on July 31, 2008 (click here for the PTO’s Assignment Records). Wynn subsequently renewed the registered mark on November 28, 2008 (with specimens showing the mark used in connection with the XS nightclub). [Comment: One wonders how much goodwill there was for Wynn to acquire along with the actual trademark registration?]

Of course, Wynn’s acquisition only allowed it to overcome half of the trademark battle. With Wynn owning the registered mark that was owned by XS Entertainment, Inc., the PTO still suspended prosecution of Wynn’s two pending applications pending the outcome of NYLO’s earlier filed intent-to-use application.

On April 22, 2009, NYLO sent a cease and desist letter to Wynn demanding that Wynn stop using the XS mark (and dropping the hint that it would be willing to discuss licensing opportunities). Wynn’s counsel responded to NYLO noting Wynn’s ownership of a trademark registration for XS as well as Wynn’s actual use in commerce of the XS mark (compared to NYLO’s pending intent-to-use).

NYLO’s counsel wrote back to Wynn on May 28, 2009, reiterating its demands that Wynn cease and desist and claiming that Wynn’s trademark registration for XS was invalid on the basis that a) when the registration was renewed, it was not being used for “indoor and outdoor amusement complexes” b) the original application was impermissibly broadened to include “bar services” and c) that the mark had been abandoned by XS Entertainment. NYLO argues that Wynn’s only rights are its common law rights acquired through its actual use of the XS mark in January 2009 – long after the constructive use date of NYLO’s application [ed.—and after Wynn had actual notice of NYLO’s pending intent-to-use application].

Based on this “reasonable apprehension” that Wynn is violating NYLO’s trademark rights and that NYLO will pursue injunctive relief against Wynn – when and if NYLO’s pending trademark application is ever registered – Wynn filed for a declaratory judgment that its use of XS is lawful and does not violate NYLO’s rights.

Of course, the big question here is how could NYLO have gotten its own XS trademark application approved by the PTO in light of the existing XS registration where there was a clear overlap of services in the area of “restaurant services.”

Looking at NYLO’s lengthy list of services, does Wynn have a possible argument that NYLO lacked a bona fide intent to use the mark in connection with all of the services described? After all, NYLO is still on its third extension of time to file a statement of use. Does NYLO have the business plan materials to show a bona fide intent back to when it first filed the application? We shall see.

Steve Green with the Las Vegas Sun, an avid trademark lawsuit watcher, has his own article on the lawsuit (link here).

Toy Maker Seeks Declaratory Judgment That “Boogie Board” is Generic for … Guess What?

Wham-O's BOOGIE® body board

Hong Kong based toy company Manley Toys, Ltd., the maker of the BANZAI line of water toys including a water slide with a Banzai “boogie board” (pictured below), filed a declaratory judgment action against Wham-O, Inc., the owner of the registered trademark BOOGIE (for body boards), after receiving a cease and desist from Wham-O over the use of the term “boogie board”. See Manley Toys, Ltd. v. Wham-O, Inc., Case No. 09-cv-04198 (C.D. Cal. June 12, 2009). A copy of the complaint is available here.

Banzai's Water Slide with "Boogie Board"

Ozzy Osbourne Files Lawsuit Against Anthony Iommi Over BLACK SABBATH Trademark

Multiple news sources (Reuters, E! Online, Entertainment Weekly) reported over the weekend on the lawsuit filed last week in the U.S. District Court for the Southern District of New York by Ozzy Osbourne against his Black Sabbath band partner Anthony Iommi over ownership of the BLACK SABBATH mark. See John Osbourne (p/k/a Ozzy Osbourne) v. Anthony Iommi , Case No. 09-cv-04947 (S.D.N.Y. Filed May 26, 2009). Blabbermouth.net has a posting of the complaint here.

In December 2008, Iommi filed his own trademark infringement lawsuit against Signature Network (previously blogged here) over the sale of unlicensed “Black Sabbath” Merchandise. As part of that complaint, Iommi described how he came to be the sole owner of the “Black Sabbath” trademark. Particularly, with respect to Ozzy Osbourne, on June 30, 1980, Osbourne and his company, Monowise, Ltd. assigned and transferred

any and all rights of any kind or nature that they have or have had in the name 'BLACK SABBATH' .... OSBOURNE further agree[d] that he will not hereafter, directly or indirectly, use, permit, or authorize the use of the name 'BLACK SABBATH' or any part of it or any similar name in connection with any activities in and throughout the entertainment industry.

Interestingly, it was that dispute with Signature Network that may have started the dispute leading up to Ozzy’s present lawsuit. According to correspondence dated April 2008 from Ozzy’s attorney to Iommi’s attorney (attached as exhibits to Ozzy’s complaint), Ozzy became aware of Iommi’s cease and desist letter to Signature Network and Iommi’s claim to be the sole owner of the BLACK SABBATH mark. Apparently at that time the letter was sent out, Iommi and Ozzy had been negotiating some kind of agreement memorializing their joint ownership of the BLACK SABBATH mark as well as negotiating a renewal of the license agreement by Signature Network.
In a letter from Ozzy’s attorney sent on January 29, 2009 (after Iommi’s lawsuit against Signature Network had been filed), Ozzy’s response to the aforementioned assignment is that Ozzy and his wife, Sharon Osbourne, had been in charge of controlling the nature and quality of the services rendered under the BLACK SABBATH mark since 1997 (when the BLACK SABBATH reunion tour began).

This same sentiment is echoed in Ozzy’s official press release statement regarding the lawsuit which explains in the following manner why his prior assignment of the BLACK SABBATH name in the early 1980s may not be relevant to the goodwill inherent in the BLACK SABBATH name today:

Throughout the last 12 years, it was my management representatives who oversaw the marketing and quality control of the “Black Sabbath” brand through OZZFEST, touring, merchandising and album reissues. The name "Black Sabbath" now has a worldwide prestige and merchandising value that it would not have had by continuing on the road it was on prior to the 1997 reunion tour.

Ozzy also apparently was not even aware of the federal trademark registration that Iommi had obtained from the U.S. Patent and Trademark Office until recently.

Ozzy’s seeks a declaration that he is at least a joint owner of the BLACK SABBATH mark and that Iommi is not the sole owner of the mark. Ozzy also seeks cancellation of the BLACK SABBATH federal registration on the basis that Iommi, when he filed the application in March 1999, made a knowingly false statement to the PTO when he declared that no other person had any right to use the BLACK SABBATH mark in commerce. Two additional causes of action for monies owed and misappropriation of Ozzy’s right of publicity are also claimed.

Software Maker Files Declaratory Judgment Action Against The Naked Cowboy

The Naked Cowboy

Bloomberg reports that European mobile phone software maker Gameloft has filed a declaratory judgment action against Robert Burck, better known as “The Naked Cowboy” (the self-appointed most famous “busker” in New York City), in the U.S. District Court for the Central District of California. See Gameloft S.A. et al, v. Robert Burck, et al,, Case No. 09-cv-3769 (C.D. Cal. Filed May 27, 2009).  A copy of the complaint can be downloaded here. 

(Click here for prior blog posts regarding Burck’s lawsuit against against Mars Incorporated, the maker of M&Ms candies, over an M&M ad featuring a cartoon M&M guitar-playing street performer wearing a cowboy hat, boots, and underwear – all reminiscent of Burck’s alter ego).

Burck obtained a registration for the mark NAKED COWBOY for various entertainment services on April 9, 2002. He obtained second registration on September 2, 2003, for a design mark resembling The Naked Cowboy’s likeness (pictured below) for various clothing items including, of course, underwear.

According to the Bloomberg article, one of Gameloft’s games contains a character name Nick who wears a cowboy hat and plays the guitar in Times Square. (It is not clear from the article if Nick is wearing white underwear and white boots).

Apparently, Burck has threatened to take legal action against Gameloft for trademark infringement. Thus, Gameloft took preemptory action by filing for a declaratory judgment of non-infringement.

Gameloft seeks a declaration that its Nick character is protected by the First Amendment and does not infringe on Burck’s trademark rights. Gameloft describes Nick as a “minor part of the game” representing “a humorous caricature that imitates the style of Times Square performers for comic effect and is not a literal depiction of the Naked Cowboy.”

By filing this case in California (as opposed to waiting until Burck takes action – likely in New York where Burck is located), Gameloft may be hoping to take advantage of last year’s decision Ninth Circuit decision in E.S.S. Entertainment 2000, Inc. v. Rock Star Videos, Inc., __ F.3d __ (9th Cir. Nov. 5, 2008) (blogged here). In that case, the Ninth Circuit ruled that the First Amendment protected the makers of the video game Grand Theft Auto: San Andreas from trademark infringement claims brought by the owner of an East Los Angeles strip club named “Play Pen” over a depiction of a fictional “East Los Santos” strip club named “Pig Pen” in the video game. The court held that Rock Star’s modification of the “Play Pen” mark had some artistic relevance in the underlying work and was not explicitly misleading, and thus was protected by the First Amendment.

GunBroker.com Seeks Declaratory Relief Against Heckler & Koch and the Trademark Enforcement Efforts of Continental Enterprises, Inc.

On May 14, 2009, GunBroker.com, LLC (“GunBroker”), the owner of the website www.GunBroker.com, filed a declaratory relief action against Heckler & Koch Inc. (“H&K”), the U.S. subsidiary of the German firearm manufacturer Heckler & Koch, GmbH, in the U.S. District Court for the Middle District of Georgia. See GunBroker.com LLC v. Heckler & Koch Inc., Case No. 09-cv-00051 (M.D. Ga.). A copy of the complaint can be downloaded here.

H&K is the owner of the registered HK logo trademark (pictured above) as well as numerous other registered marks that H&K uses in connection with certain models of H&K firearms such as USP, P7, and MP7 (some of which are also occasionally used in connection with other items including swords and knives).

Heckler & Koch's MP7

GunBroker’s website offers an online auction service for third parties to sell merchandise such as firearms, knives, swords, and hunting equipment and accessories to interested parties. Sellers create the auction listing and submit it to GunBroker, which then adds the auction to its site, administers the auction, notifies the auction winner, and provides details on how the winner can contact the seller. GunBroker’s Website User Agreement specifically prohibits the posting of items for sale that violate any third party’s intellectual property rights, and GunBroker provides a mechanism for trademark holders to report any violations.

According to the complaint, on August, 27, 2008, GunBroker’s predecessor-in-interest received a letter from the “Office of the General Counsel” for Continental Enterprises, Inc. (“CE”). The letter indicated that CE had been engaged by H&K to protect H&K’s intellectual property and that several hundred auction listings on GunBroker’s website violated H&K’s trademark and copyright rights. The letter enclosed a 16 page printout from GunBroker’s website that showed a list of auction listings (over 340) posted by third party sellers on the website who were attempting to sell merchandise and in some way using one or more of the H&K trademarks.

The basis of CE’s engagement to enforce H&K’s intellectual property rights was a letter from James E. Baker, Jr., an attorney with the Baltimore, Maryland law firm of Baxter, Baker, Sidle, Conn & Jones, P.A. (the “Baxter Firm”), which purportedly confirmed that H&K had engaged the services of CE to identify and investigate any unauthorized uses of H&K’s intellectual property. Apparently, however, the letter did not explain the relationship between the Baxter Firm and H&K nor did it indicate whether or not the Baxter Firm is an agent of H&K or otherwise entitled it to act on behalf of H&K.

According to the complaint, the owner of CE is Mr. Karl Manders, a career private investigator (but not a lawyer) who, through his company, concentrates exclusively on the enforcement of intellectual property rights. GunBroker believes that CE obtains a percentage of any settlement proceeds that CE receives from its efforts. CE has supposedly acted on behalf of such companies as Heineken USA, Inc., Just Born, Inc., and Big Dog Holdings, Inc.

GunBroker also notes in its complaint that Indiana’s Rules of Professional Conduct (Rule 5.4(a)) prohibits a lawyer from entering into a partnership with a non-lawyer and from sharing legal fees with a non-lawyer and cites Indiana State Bar Legal Ethics Opinion (Indiana State Bar Association, Legal Ethics Committee, Opinion #7, 1991) discussing that Rule 5.4(a) was designed to prevent “the possibility of control by a lay person who is interested in profit, rather than the client’s interests, and control by a person who is unregulated by the profession.”

GunBroker alleges that it has become the target of CE’s “for profit” intellectual property enforcement efforts. Click here for one website’s detailed discussion about CE’s trademark enforcement efforts – including a separate page entitled “What To Do If Contacted By Continental Enterprises.”

GunBroker’s complaint notes that the list of allegedly infringing auctions provided by CE did not distinguish between allegedly infringing use of H&K’s trademarks and the fair use of H&K’s trademarks by sellers listing authentic H&K products or otherwise making a fair use of H&K’s trademarks. Moreover, despite GunBroker’s request, neither CE nor H&K have used the mechanism on GunBroker’s website, to report a specific violation or to clarify which if any, specific postings on GunBroker’s website that CE or H&K believe infringe on H&K’s trademarks.

CE has threatened that GunBroker’s further advertisement or sale of “infringing merchandise” would be considered “willful infringement,” and would subject GunBroker “to enhanced penalties, including, but not limited to, treble or statutory damages and attorneys fees.” CE has also threatened to “advise H&K to take whatever steps it deems necessary to fully protect its intellectual property rights.”

Based on CE’s actions and threats regarding GunBroker’s alleged trademark infringement of H&K’s trademarks through the third party auction listings on GunBroker’s website, GunBroker maintains that a substantial controversy exists between the parties to warrant GunBroker’s request for declaratory relief.

GunBroker seeks a declaratory judgment that it has not infringed H&K’s trademarks, that it has not committed any contributory trademark infringement through the auction listings by sellers comparing their product to an H&K product, selling products that are compatible with an H&K product, selling products that are a “knock-off or look alike” to an H&K product, or reselling a used H&K product, and that such uses of H&K’s trademarks by sellers in their auction listings is fair use.