Judge Der-Yeghiayan denied defendant Aksoy’s motion to dismiss in this Lanham Act case regarding the CHICAGO TROLLEY mark for use with Chicago Trolley Tours. An individual acting as a corporate officer – such as Aksoy – generally cannot be held individually liable. In the case of trademark and copyrights claims, however, an officer can be held personally liable where the officer was personally involved or aware. And plaintiff TRT Transportation sufficiently pled that involvement.

Continue Reading Officers Can be Liable for Corporate Trademark and Copyright Infringement

Arcadia Group Brands Ltd. v. Studio Moderna SA, No. 10 C 7790, Slip Op. (N.D. Ill. Aug. 15, 2011) (Der-Yeghiayan, J.).
Judge Der-Yeghiayan granted plaintiffs’ (collectively “Arcadia”) motion to dismiss defendants’ (collectively “Moderna”) counterclaims and denied Moderna’s motion to dismiss Arcadia’s claims in this Lanham Act case involving Arcadia’s TOPSHOP and Moderna’s TOP SHOP TV marks. In 2004, the parties entered a settlement agreement (the “Agreement”) pursuant to which Moderna agreed not to use TOPSHOP to sell women’s clothing in any country. Arcadia alleged that Moderna violated the Agreement beginning in 2010 when it began selling women’s clothing in the US on Moderna’s topshoptv.com website.
Moderna’s Motion
Moderna argued that Arcadia did not plausibly plead a protectable mark because Moderna was the first user of the mark. But a motion to dismiss must assume the truth of Arcadia’s allegations and Arcadia plausibly pled that it was the first user of the mark. Additionally, Moderna’s arguments ignored that Arcadia’s complaint challenged the validity of Moderna’s TOPSHELF TV registration.
Arcadia sufficiently pled fame as part of its trademark dilution claim. While Arcadia did not parrot the language of the statute, it pled its TOPSHOP brands were “world famous”, that the brand is one of the most successful in the world, that there have been millions of dollars in US sales and that the brand is regularly featured in US and international fashion and celebrity magazines and other media.
Arcadia’s Motion
The Court dismissed Moderna’s counterclaim for a declaratory judgment that it was the senior user of its TOP SHOP TV mark. Arcadia, however, had never challenged Moderna’s TOP SHOP TV mark. Arcadia’s only claims, in the suit or otherwise, were with respect to its TOPSHOP mark. As a result, any decision regarding the mark would be an impermissible advisory opinion.
The Court dismissed Moderna’s trademark misuse counterclaim because Moderna did not show that trademark misuse was an affirmative cause of action. Moderna was, however, allowed to amend its answer to add an affirmative defense of trademark misuse.

Continue Reading Determining Senior User is Not an Issue for Motion to Dismiss

Patent Compliance Group, Inc. v. Brunswick Corp., No. 10 C 4645, Slip Op. (N.D. Ill. Jan. 14, 2010) (Der-Yeghiayan, J.).
Judge Der-Yeghiyan denied defendant Brunswick’s Fed. R. Civ. P. 12(b)(6) motion to dismiss plaintiff Patent Compliance Group’s (“PCG”) false patent marking claims regarding Brunswick’s exercise equipment. First, the Court held that Rule 9(b) heightened pleadings applied to the intent to deceive requirement of false patent marking, and anologized to the Federal Circuit’s inequitable conduct pleading requirements. While PCG’s first complaint alleging that Brunswick was a sophisticated company, PCG’s amended complaint attaching Patent Office documents identifying the expiration dates of the allegedly expired patents and identifying Brunswick’s in-house patent counsel was sufficient.

Continue Reading Court Analogizes Inequitable Conduct Pleading to False Marking Pleading

Nova Design Build, Inc. v. Grace Hotels, LLC, No. 08 C 2855, Slip Op. (N.D. Ill. Jun. 8, 2010) (Der-Yeghiayan, J.).
Judge Der-Yeghiayan granted defendant Grace Hotel’s motion for costs and denied without prejudice Grace Hotel’s motion for attorney’s fees. As an initial matter, the Court held that Grace Hotels was a prevailing party pursuant to both Fed. R. Civ. P. 54(d) (costs) and 17 U.S.C. § 505 (attorney’s fees). While the standards were different, Grace Hotels met both standards. Grace Hotels was granted summary judgment on plaintiff’s copyright infringement claim because plaintiffs did not have a valid copyright registration – click here for more on this opinion in the Blog’s archives. While the decision was jurisdictional and not substantive, Grace Hotel was a prevailing party because the Court’s ruling “effectively foreclosed” Plaintiff’s copyright claims. In other words, “Grace [Hotels] obtained more than just a moral victory on a minor jurisdictional point.” Because Grace Hotels was a prevailing party, the Court awarded the reasonable costs Grace Hotels requested for court reporter fees pursuant to Fed. R. Civ. P. 54(d) – $2,534.70.
While Grace Hotels was also a prevailing party for purposes of § 505, the Court denied Grace Hotels attorney’s fees motion without prejudice. The fees did not appear reasonable. They were not limited to fees associated with defending the copyright claim. Grace Hotels was not entitled to fees for defending related state law claims which the Court declined to exercise supplemental jurisdiction over after resolving the federal copyright claim. Grace Hotels also sought fees for a separate case between the parties. The Court allowed Grace Hotels to file a renewal motion for attorney’s fees tailored to the recoverable fees.

Continue Reading Attorney’s Fees Petition Must be Tailored to Resolved Claims

Nova Design Build, Inc. v. Grace Hotels, LLC, No. 08 C 2855, Slip Op. (N.D. Ill. Feb. 26, 2010) (Der-Yeghiayan).
Judge Der-Yeghiayan granted defendant summary judgment as to plaintiffs’ copyright infringement claims, and refused to exercise supplemental jurisdiction over plaintiff’s state law claims. Plaintiffs had a registered copyright, which was prima facie evidence of registration. But the Court held the registration was invalid because it was not accompanied by original deposit materials.
Plaintiffs were robbed prior to filing for their copyright. The original building diagrams were taken at that time. So, in order for plaintiffs to get copyright protection, plaintiff prepared a reconstruction of the deposit materials – blueprints in this case. The fact that the deposit material was a close approximation of the originals was not enough. Furthermore, manual reconstruction without reference to the original was also not sufficient. Having denied plaintiffs’ federal claims, the court exercised its discretion to refuse supplemental jurisdiction over the state law claims.
* Click here for much more on the case in the Blog’s archives.

Continue Reading Reconstructed Deposit Materials Not Sufficient For Copyright Registration

Valley Entertainment, Inc. v. Friesen, No. 08 C 3470, Slip Op. (N.D. Ill. Feb. 17, 2010) (Der-Yeghiayan, J.).
Judge Der-Yeghiayan granted defendants summary judgment of noninfringement regarding plaintiff Valley Entertainment’s (“Valley”) copyright infringement claim regarding certain songs by the artist Raphael. The Court also granted defendants’ motion to strike Valley’s newly identified copyright, SR 107-850. Finally, the Court declined to exercise supplemental jurisdiction over Valley’s remaining state law claims. Valley’s asserted copyright covered only words and arrangement of sheet music, but defendants’ alleged infringement was based upon the use of sound recordings of the songs at issue. Valley did not challenge this analysis, instead identifying a new copyright, SR 107-850, that covers sound recordings. But the Court struck that copyright because it was not identified until briefing of the summary judgment motion. The copyright was not identified in Valley’s complaint or in any of Valley’s numerous discovery responses as a basis for Valley’s copyright infringement claims. The Court noted that Valley was no longer free to update its discovery pursuant to Fed. R. Civ. P. 26(a) because the update would no longer be timely.
Having resolved Valley’s federal claims, the Court declined to exercise supplemental jurisdiction over Valley’s related state law claims.

Continue Reading Court Strikes Plaintiff’s Late-Identified Copyright

Mindy’s Restaurant, Inc. v. Watters, No. 08 C 5448, Slip Op. (N.D. Ill. Jun. 9, 2009) (Der-Yeghiayan).
Judge Der-Yeghiayan granted defendants’ Fed. R. Civ. P. 12(b)(1) motion to dismiss for lack of subject matter jurisdiction even though plaintiff brought a federal Lanham Act trademark infringement claim. While Lanham Act claims are generally considered federal questions creating subject matter jurisdiction, plaintiffs claims were in essence breach of contract claims. Plaintiff was a franchisor of Mindy’s Restaurants. Defendants were franchisees, until they allegedly stopped making required franchise payments and plaintiff terminated the franchise agreement. While plaintiff’s claims were for use of plaintiff’s trademarks when defendants allegedly continued operating their restaurant after the franchise agreement was canceled. As a result, the Court held that the parties dispute and plaintiff’s claims sounded in contract, not the Lanham Act. The reason the trademarks were allegedly infringed was the termination of the franchise agreement.

Continue Reading Trademark Claims Dismissed Because Dispute Sounds in Contract

Americash Loans, LLC v. AO Ventures, LLC, No. 08 C 5147 (N.D. Ill. Mar. 19, 2009) (Der-Yeghiayan, J.).
Judge Der-Yeghiayan denied defendant AO Ventures (“AOV”) motion to dismiss plaintiff Americash Loans’ Lanham Act and related state law claims. Americash Loans alleged that AOV infringed Americash Loans’ “Americash Loans” mark by advertising confusingly similar mark on AOV’s website. First, the Court held that Americash Loans’ prior settlement of a trademark dispute with a third party did not preclude this suit. The prior suit involved a different mark, “Americash,” and Americash Loans did not allege that AOV was acting as an agent of the third party involved in the earlier settlement when it allegedly used the infringing marks.
The Court also held that the fact that AOV was not accused of using the exact mark, but a confusingly similar mark was not grounds to dismiss the complaint. The Court noted that customer confusion between similar marks was a recognized part of trademark infringement analysis and that suits were routinely filed alleging infringement based upon the use of marks that were not identical to the asserted trademark.
Further, the Court held that whether AOV’s display of a third party’s advertisement was a use of the accused mark was a question of fact that could not be resolved by a Rule 12 motion. Finally, the Court held that it could not decide whether AOV’s alleged infringement was a nominative fair use of Americash Loans’ mark because any fair use analysis involves questions of fact.

Continue Reading Fair Use & Similarity of Marks Not Issues for Motion to Dismiss

Nova Design Build, Inc. v. Grace Hotels, LLC., No. 08 C 2855, Slip Op. (N.D. Ill. Mar. 25, 2009) (Der-Yeghiayan, J.).
Judge Der-Yeghiayan granted in part and denied in part plaintiffs’ Fed. R. Civ. P. 12(b)(6) motion to dismiss defendants’ counterclaim copyright infringement case. Plaintiffs claimed that they developed plans for a Holiday Inn Express hotel defendants planned to build, and that defendants infringed the copyrights in plaintiffs’ plans by revising them with another firm and using them without plaintiffs’ permission. The Court previously held that plaintiffs’ copyright claim was sufficiently pled — click here for more on that opinion and the case generally in the Blog’s archives. After that opinion, defendants answered the complaint and filed a counterclaim seeking among other things declaratory relief. The Court dismissed the counterclaim as to plaintiff Annex whom defendants agreed should be dismissed. And the Court struck defendants’ request that plaintiffs’ complaint be struck because the Court already denied defendants’ Rule 12(b)(6) motion to dismiss.
But the Court denied to dismiss defendants’ counterclaim. Plaintiffs argued that the counterclaim should be dismissed because it was not clearly pled, the legal basis was not specifically identified and it lacked factual detail. But the Court held that notice pleading did not require good grammar or organization, nor were specific facts required. Because defendants’ counterclaim put plaintiffs on notice that their copyright was allegedly a derivative works to which defendants maintained certain rights. To the extent plaintiffs believed additional information, the appropriate remedy was a Rule 12(e) motion for a more definite statement. But the Court noted that a more definite statement was not required in this case because defendants’ counterclaim put plaintiffs on notice.

Continue Reading Notice Pleading Does Not Require a Claim be Well Written

Mindy’s Restaurant, Inc. v. Watters, No. 08 C 5448, Slip Op. (N.D. Ill. Feb. 27, 2009) (Der-Yeghiayan, J.).
Judge Der-Yeghiayan denied defendant’s motion to disqualify plaintiff’s counsel in this Lanham Act dispute regarding plaintiff’s Mindy’s Restaurant marks. Defendant previously was a licensee of plaintiff’s marks. During their licensing arrangement, the parties explored a potential joint venture. As part of that process, plaintiff and defendant jointly met with a member of plaintiff’s current law firm. Defendant contended that that meeting created an attorney-client relationship which disqualified plaintiff’s counsel from this case. But the Court held that even if the single meeting with both parties created an attorney-client relationship, there was only a “slight tangential relationship” between the current case and the prior potential joint venture. And the attorney involved could not have received confidential information. The attorney met with both parties together and never spoke to either party about the matter after the initial meeting. So any information defendant provided to the attorney was also provided to plaintiff. Finally, there was no evidence that the attorney or any member of plaintiff’s counsel’s firm would ever be called as an essential witness in the case.

Continue Reading No Disqualification for Counsel’s Prior Meeting with Both Parties