Opinion
07 Civ. 4802 (DAB).
March 31, 2010
MEMORANDUM AND ORDER
I. INTRODUCTION
Societe des Bains de Mer et du Cercle des Etrangers a Monaco's ("SBM") is the operator of all casino properties, and other attractions, in the Principality of Monaco. SBM has sued Playshare PLC ("Playshare"), an operator of online casino websites, and others, alleging trademark violations and unfair competition under federal and state law as to SBM's mark CASINO DE MONACO. Playshare counter-sued SBM in a separate action seeking: (1) a declaratory judgment that Playshare is not infringing on SBM's trademarks and (2) to overturn a decision by the World Intellectual Property Organization ("WIPO") awarding various domain names held by Playshare to SBM. Both actions are now consolidated before this Court.
On June 6, 2007, SBM filed a complaint in U.S. District Court in New York alleging that Playshare and other Defendants' use of the designations GRAND MONACO, GRAND MONACO CASINO, GRAND MONDIAL and GRAND MONDIAL CASINO, along with various domain names ("Monaco Domain Names"), infringes on a mark owned and registered by SBM: CASINO DE MONACO. The mark CASINO DE MONACO is registered with the U.S. Patent and Trademark Office ("USPTO") for use in connection with "providing casino services within a hotel environment." See USPTO Reg. No. 3,031,006. SBM has also filed an application for another mark with the same designation, CASINO DE MONACO, but for use in connection with casino services. See USPTO Appl. Serial No. 77/329,567. Finally, SBM filed an application for the mark CASINO DE MONTE-CARLO. See USPTO Appl. Serial No. 77/329,593. SBM does not allege in its complaint that Playshare is infringing on its unregistered mark CASINO DE MONTE-CARLO. However, SBM clearly conflates the marks CASINO DE MONACO and CASINO DE MONTE-CARLO in its arguments to the Court.
The Defendants in the New York action (Docket No. 07 Civ. 4802) are Playshare PLC, Grand Monaco Ltd., GamShare (UK) Ltd., Lucan Toh, Maxwell Wright, and Hillstead Ltd. For ease of reference, the Court will refer to the Defendants in the New York action and the Counterclaim-Plaintiffs in the former Arizona action (Docket No. 08 Civ. 2278) collectively as "Playshare."
On June 19, 2007, Playshare, and two other Defendants from the New York action, Lucan Toh and Maxwell Wright, subsequently filed a complaint in U.S. District Court in Arizona seeking a declaratory judgment that: (1) Playshare's use of the Monaco Domain Names is in compliance with the Anticybersquatting Consumer Protection Act; (2) SBM's mark CASINO DE MONACO, U.S. Trademark, Registration No. 3,031,006, is invalid and unenforceable; and (3) SBM's unregistered mark CASINO DE MONTE-CARLO is unenforceable. The Arizona action was transferred to this Court on April 11, 2008 and consolidated with the New York action for all purposes under Docket No. 07 Civ. 4802. For purposes of this consolidated action, the Court treats Playshare's claims from the Arizona action as Counterclaims. Accordingly, in this Opinion, SBM is known as the Plaintiff/Counterclaim-Defendant. Playshare is the Defendant/Counterclaim-Plaintiff.
The Counterclaim-Plaintiffs in the former Arizona action are Playshare PLC, Lucan Toh and Maxwell Wright. Again, for ease of reference, they will be referred to as "Playshare."
In UDRP Domain Name Decision Case No. D2007-0249, the WIPO ordered Defendants/Counterclaim-Plaintiffs Lucan Toh and Maxwell Wright to transfer the following domain names to SBM, all of which contained the noun "Monaco" and often accompanied with the Noun "Grand" and/or a noun whose meaning is associated with gaming: casinograndmonaco.com, casinograndmonaco.net, casinograndmonaco.org, deutschesgrandmonaco.com, grandmonacoayda.com, grandmonacoayuda.com, grandmonacobingo.com, grandmonacobingo.net, grandmonacocasinoclub.com, grandmonacocasinoclub.net, grandmonacocasinoclub.org, grand-monaco-casino.com, grandmonacocasino.com, grandmonacocasino.net, grandmonacocasino.org, grandmonacoclub.com, grandmonaco.com, grandmonaco.com, grandmonacocraps.com, grandmonacogames.com, grandmonacogames.net, grandmonacogaming.com, grandmonacogaming.net, grandmonacohost.com, grandmonacohosts.com, grandmonacolottery.com, grandmonacolottery.net, grandmonacolotto.com, grandmonacolounge.com, grandmonacomahjong.com, grandmonacomillions.com, grandmonacomillions.net, grandmonacomillions.org, grandmonaco.net, grandmonaconews.com, grandmonacoonlinecasino.com, grandmonacoonlinegaming.com, grandmonacoonlinepoker.com, grandmonaco.org, grandmonacopartners.com, grandmonacoplayersclub.com, grandmonacoplayersclub.net, grandmonacopokerclub.com, grandmonacopokerclub.net, grandmonacopokerclub.org, grandmonaco-poker.com, grandmonacopoker.com, grandmonacopoker.net, grandmonacopoker.org, grandmonacopromotions.com, grandmonacoracebook.com, grandmonacoracebook.net, grandmonacoracebook.org, grandmonacorewards.com, grandmonacoskillgames.com, grandmonacoskillgames.net, grandmonacoslots.com, grandmonacosportsbook.com, grandmonacosportsbook.net, grandmonacosports.com, grandmonacosports.net, grandmonacostore.com, grandmonacosupport.com, grandmonacovideopoker.com, pokergrandmonaco.net, and pokergrandmonaco.org.
Now before the Court are cross-motions by Playshare and SBM for summary judgment and Playshare's motion to strike the report of SBM's expert, Dr. Ronald Butters. Specifically, Playshare moves for summary judgment on all counts against it and to dismiss SBM's Second Amended Complaint in its entirety. SBM cross-moves for summary judgment on liability only, and preserves its demand for a jury trial with respect to damages. For the reasons below, Playshare's motion is granted in part and denied in part. SBM's Motion is denied in its entirety. Due to the Court's findings on the cross motions for summary judgment, Playshare's motion to strike Dr. Ronald Butters' expert report is moot.
II. BACKGROUND
A. FACTUAL HISTORY
1. Playshare
Defendant/Counterclaim-Plaintiff PlayShare is a United Kingdom company that owns non-party Naden, Inc. ("Naden"). (Wright Decl. ¶¶ 2-3.) Playshare acquired Naden on November 2, 2006. (Wright Decl. ¶ 3.) As a subsidiary of Playshare, Naden owns and operates the on-line gaming website Grand Mondial Casino. (Wright Decl. ¶ 3.) The Grand Mondial Casino was formerly the Grand Monaco Casino. (Wright Decl. ¶ 3.) Defendants Grand Monaco Ltd. and GamShare (UK) Ltd. do not currently have operations. (Wright Decl. ¶ 4.) Defendant Hillstead, Ltd. is a subsidiary of Naden and handles financial transactions for its parent. (Wright Decl. ¶ 5.) Defendant/Counterclaim-Plaintiff Maxwell Wright is the Chief Executive Officer of Playshare. (Wright Decl. ¶ 1.) Defendant/Counterclaim-Plaintiff Lucan Toh is a former director of PlayShare. (Wright Decl. ¶ 1.) Lucan Toh resigned in October of 2006, before PlayShare's acquisition of Naden and Grand Monaco Casino (now Grand Mondial Casino). (Wright Decl. ¶ 6.)
2. SBM
Plaintiff/Counter-claim Defendant SBM is a societe anonyme organized and existing under the laws of the Principality of Monaco. (Lambert Decl. ¶ 2.) SBM is the founder and manager of five Monaco-based casinos and operates restaurants, hotels, spas, a theater and an opera house in Monaco. (Lambert Decl. ¶ 4; SBM's Response to Playshare's 56.1 Stmt. ¶¶ 61-64.) While SBM does not operate an on-line gaming business, it has represented that its entry into the online-gaming market is "imminent." (Lambert Decl. ¶ 9.) SBM operates no casinos in the U.S and has no casino by the name of Casino de Monaco. (SBM's Response to Playshare's 56.1 Stmt. ¶¶ 58-60, 66.)
3. SBM NY and its activity in the U.S.
SBM has a New York subsidiary ("SBM NY") that engages in "sales offerings and/or sales to U.S. Residents of casino services, includ[ing], casino gift vouchers for chips to be used at SBM's casinos in Monaco, as well as actual chips themselves; complementary admission to the Casino de Monte-Carlo; lines of credit for wagering in Monaco; reservations for private rooms at the Casino de Monte-Carlo; and SBM's Games Initiation program." (Lambert Decl. ¶ 20.) SBM "offers for sale and/or sells casino services to Americans in the [form of] U.S. Casino gift vouchers, which are pre-paid credit certificates redeemable for chips for wagering at any of SBM's" Monaco casinos. (Lambert Decl. ¶ 21.) American clientele can have these vouchers offered through SBM's website (www.montecarlocasinos.com) sent to them by mail in the U.S. (Lambert Decl. ¶ 21.) American corporate groups can purchase these vouchers through SBM NY. (Lambert Decl. ¶ 21.) SBM has identified 326 casino vouchers sold to 180 U.S. consumers (representing 13 reservations, for a total of 7,882 Euros since 2005). (Lambert Decl. ¶ 22.) Americans can pre-purchase casino chips on SBM's websites (www.montecarloresort.com and www.casinodemonaco) (Lambert Decl. ¶ 23.) American corporate groups can purchase casino chips through SBM NY. (Lambert Decl. ¶ 23.) SBM also offers a "Gold Card" to guests of its hotel properties. (Lambert Decl. ¶ 24.) The Gold Card permits its hotel guests to receive free admission to the Casino de Monte-Carlo. (Lambert Decl. ¶ 24.)
SBM NY assists corporate and individual clients in their needs for planning and executing visits to SBM properties. (SBM's 56.1 Stmt. ¶ 34-40.) SBM NY processes the contracts with SBM's corporate clients and individual clients. (SBM's 56.1 Stmt. ¶ 38.) Deposits and installment payments are sent directly from the U.S. client to SBM in Monaco, via wire transfer. (SBM's 56.1 Stmt. ¶ 38.) All booking contracts are signed in Monaco. (SBM's Response to Playshare's 56.1 Stmt. ¶ 71.)
4. SBM's marks
On December 24, 2002, SBM applied in the USPTO, Appl. Serial No. 76/478,796, for registration of the mark CASINO DE MONACO. (SBM's Response to Playshare's 56.1 Stmt. ¶ 132.) The mark was filed, inter alia, based on claimed bona fide intent to use for a host of certain goods and services and based on SBM's foreign mark, CASINO DE MONACO (02.23234), issued by Monaco. (SBM's Response to Playshare's 56.1 Stmt. ¶ 133.) On February 4, 2004, the USPTO refused to register the claimed mark as merely descriptive of casino services emanating from Monaco. (SBM's Response to Playshare's 56.1 Stmt. ¶ 137.) In response, SBM submitted evidence that its mark had acquired secondary meaning, and on December 20, 2005, the USPTO registered the mark CASINO DE MONACO. (See USPTO Reg. No. 3,031,006.) On December 20, 2008 (following the commencement of this action), SBM voluntarily amended its mark for CASINO DE MONACO to limits its use to "providing casino services within a hotel environment." (SBM's Response to Playshare's 56.1 Stmt. ¶ 148.) SBM's registered mark for CASINO DE MONACO is based on a bona fide intent to use the mark. (SBM's 56.1 Stmt. ¶ 14.)
On November 14, 2007 (after commencement of this action), SBM filed an application for a mark with the exact same designation: CASINO DE MONACO. (See USPTO Appl. Serial No. 77/329,567; SBM's Response to Playshare's 56.1 Stmt. ¶ 150.) However, the application for this mark is for use in connection with casino services. (Id.) Playshare has opposed SBM's application; the new registration is still pending. (Playshare's 56.1 Stmt. ¶ 153.) Also on November 14, 2007, SBM filed an application for the mark CASINO DE MONTE-CARLO. (See USPTO Appl. Serial No. 77/329,593.)
SBM contends that the name CASINO DE MONACO is an umbrella term for all its Monaco-based casinos. (SBM's 56.1 Stmt. ¶ 19.) SBM uses CASINO DE MONACO on its website and orally when promoting its casino and casino-related services. (SBM's 56.1 Stmt. ¶ 19.) 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. (SBM's 56.1 Stmt. ¶¶ 21-24.)
5. Playshare's acquisition and use of the names Grand Monaco and Grand Mondial for its on-line gaming website
On November 2, 2006, PlayShare acquired Grand Monaco Casino (now Grand Mondial Casino) from a company called Mountain Breeze Trust when Playshare purchased the capital shares of Naden. (Wright Decl. ¶¶ 3, 11.) Playshare did no due diligence on the purchase. (Wright Decl. ¶ 12, Ex.5.) Grand Monaco Casino had been in operation since July 2006. Prior to Playshare's acquisition of Naden, Grand Monaco Casino's website had a disclaimer that stated, "Grand Monaco Casino is in no way associated with the Principality of Monaco, nor any of the land-based casino operations located in that jurisdiction." (SBM's Response to Playshare's 56.1 Stmt. ¶ 19.) Playshare's acquisition of Naden included the acquisition of certain domain names, some of which had been registered before December 20, 2005, the date a trademark was issued to SBM. (Wright Decl. ¶ 27.)
B. PROCEDURAL HISTORY
1. THE WIPO Administrative Panel
SBM contends that the domain names Playshare acquired when it purchased Naden were registered to capture internet traffic intended for SBM's websites. (SBM's Response to Playshare's 56.1 Stmt. ¶ 21; Weiss Decl. ¶ 14, Exh. 10.) Accordingly, on March 21, 2007, SBM filed a complaint before the WIPO's non-binding Uniform Domain Name Dispute Resolution Administrative Panel over the Monaco Domain Names. SMB named Defendants/Counterclaim-Plaintiffs Lucan Toh and Maxwell Wright, challenging their ownership of the Monaco Domain Names. (SBM's Response to Playshare's 56.1 Stmt. ¶ 35.)
The Uniform Domain Name Dispute Resolution Policy ("UDRP") focuses on conflicts between trademarks and domain names. If a trademark holder believes a domain name registration infringes on its trademark, it may initiate a proceeding under the UDRP. Under the standard dispute clause in the registration of a domain name, the registrant must submit to such proceedings. A domain name is either transferred, or the complaint is denied and the respondent keeps the domain name. No monetary damages or injunctive relief is available. The decision is implemented after a period of ten days, unless the decision is appealed in court in that time. Under the UDRP, either party can take the dispute to a court of competent jurisdiction for independent resolution. UDRP Policy provides that its proceedings shall not prevent either party from submitting the dispute to a court of competent jurisdiction for independent resolution. A party can commence a lawsuit after the administrative proceeding is concluded if it is not satisfied with the outcome.
(See http://www.wipo.int/amc/en/domains/guide/index.html)
In response to the dispute, in May 2007, PlayShare selected GRAND MONDIAL as its new identifying name, and registered GRAND MONDIAL as a trademark. (Wright Decl. ¶ 23.) Grand Mondial Casino was launched on August 14, 2007. (Wright Decl. ¶ 24.)
However, SBM continued to pursue its claims. On May 25, 2007, the WIPO Panel issued a decision in favor of SBM. While the Panel did not address the issue of whether the mark CASINO DE MONACO was valid, the Panel found that: (1) the Monaco Domain Names are identical or confusingly similar to SBM's trademark; (2) Playshare has no rights or legitimate interests in the Monaco Domain Names; and (3) the Monaco Domain Names were registered and are being used in bad faith. See WIPO UDRP Domain Name Decision No. D2007-0249. The Panel ordered the transfer of the Monaco Domain Names from Lucan Toh and Maxwell Wright to SBM. Id. The WIPO did not address the validity of SBM's trademark and its decision is to be given no deference here. Barcelona.com, Incorporated v. Excelentisimo Ayuntamiento De Barcelona, 330 F.3d 617, 625-26 (4th Cir. 2003).
2. The New York action
On June 6, 2007, SBM filed a Complaint in U.S. District Court in New York, and filed a Second Amended Complaint on January 14, 2008, alleging that Playshare's use of the designations GRAND MONACO, GRAND MONACO CASINO, GRAND MONDIAL CASINO, and GRAND MONDIAL, along with the Monaco Domain Names, infringes on SBM's claimed rights in the mark CASINO DE MONACO. Specifically, SBM's Second Amended Complaint has eight counts: (1) Federal Unfair Competition under Section 43(a) of the Lanham Act; (2) Federal Trademark Infringement under Section 32(1) of the Lanham Act; (3) Federal Cybersquatting; (4) Deceptive Acts and Practices under New York Law; (5) False Advertising under New York Law; (6) Injury to Business Reputation and Dilution under New York Law; (7) New York Common Law Trademark Infringement; and (8) New York Common Law Unfair Competition. To protect its registered mark, CASINO DE MONACO, SBM seeks, inter alia, a permanent injunction restraining Playshare from infringing on SBM's mark, CASINO DE MONACO, and restraining Playshare from using the designations GRAND MONACO, GRAND MONACO CASINO, GRAND MONDIAL CASINO, and GRAND MONDIAL, or any use of the place names MONACO or MONTE-CARLO for casino services. SBM also seeks a confirmation of the transfer of all the Monaco Domain Names from Playshare to SBM by the WIPO.
Southern District of New York Docket No. 07 Civ. 4802.
Playshare PLC, Grand Monaco Ltd., GamShare (UK) Ltd., Lucan Toh, Maxwell Wright, and Hillstead Ltd.'s are all Defendants in the New York action.
3. The Arizona action
On June 19, 2007, Playshare filed a separate action in the U.S. District Court of Arizona challenging the WIPO's decision requiring Playshare to transfer ownership the Monaco Domain Names to SBM. Playshare seeks a declaratory judgment on three counts: (1) Playshare's use of the Monaco Domain Names is in compliance with the Anticybersquatting Consumer Protection Act; (2) SBM's mark CASINO DE MONACO, U.S. Trademark, Registration No. 3,031,006, is invalid and unenforceable; and (3) SBM's unregistered mark CASINO DE MONTE-CARLO is unenforceable. The Arizona action was transferred to this Court on April 11, 2008 and consolidated with the New York action for all purposes under Docket No. 07 Civ. 4802. The consolidated action is known, as captioned, "In re Casino de Monaco Trademark Litigation."
Now, S.D.N.Y. Docket No. 07 Civ. 4802.
III. DISCUSSION
A. SUMMARY JUDGMENT STANDARD
The standards governing motions for summary judgment are well-settled. A court may grant summary judgment only where there is no genuine issue of material fact and the moving party is therefore entitled to judgment as a matter of law. See Fed R. Civ. P. 56(c); accord Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 585-87 (1986). Summary judgment should be denied "if the evidence is such that a reasonable jury could return a verdict" in favor of the non-moving party. See NetJets Aviation, Inc. v. LHC Commc'ns, LLC, 537 F.3d 168, 178-79 (2d Cir. 2008).In deciding a motion for summary judgment, the Court must construe the evidence in the light most favorable to the non-moving party and draw all reasonable inferences in the non-moving party's favor. In re "Agent Orange" Prod. Liab. Litig., 517 F.3d 76, 87 (2d Cir. 2008). A court faced with cross-motions for summary judgment need not "grant judgment as a matter of law for one side or the other," but "`must evaluate each party's motion on its own merits, taking care in each instance to draw all reasonable inferences against the party whose motion is under consideration.'" Heublein, Inc. v. United States, 996 F.2d 1455, 1461 (2d Cir. 1993) (quoting Schwabenbauer v. Bd. of Educ. of Olean, 667 F.2d 305, 313-14 (2d Cir. 1981)).
B. SBM'S TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION CLAIMS
At issue in this case are two marks held by SBM: (1) CASINO DE MONACO; and (2) CASINO DE MONTE-CARLO. In its Complaint, SBM alleges that Playshare is infringing only on its mark CASINO DE MONACO by use of its Monaco Domain Names and its name GRAND MONDIAL. Accordingly, as to SBM's claims, the Court will conduct a summary judgment analysis only as to the mark CASINO DE MONACO, and not the mark CASINO DE MONTE-CARLO. However, Playshare's Counterclaims (that arrived from the Arizona action) seeks a declaratory judgment that Playshare has not infringed on either mark held by SBM. More specifically, Playshare's seeks a declaratory judgment that SBM's mark CASINO DE MONACO is invalid, unenforceable and SBM's mark CASINO DE MONTE-CARLO is unenforceable. Accordingly, the Court will address SBM's mark CASINO DE MONTE-CARLO only in context of Playshare's Counterclaims for declaratory judgment.
1. Trademark infringement and unfair competition standard
To prevail on a trademark infringement and unfair competition claim under 15 U.S.C. §§ 1114(1) and 1125(a), SBM must show: (1) its Mark is protected; and (2) Playshare's use of its allegedly infringing mark would likely cause confusion as to the origin or sponsorship of the Playshare's goods with SBM's goods. Starbucks Corp. v. Wolfe's Borough Coffee, Inc., 588 F.3d 97, 114-15 (2d Cir. 2009); see also Savin Corp. v. Savin Group, 391 F.3d 439, 456 (2d Cir. 2004).
2. Validity of SBM's marks
a. The mark CASINO DE MONACO
SBM owns the Mark CASINO DE MONACO, U.S. Trademark Registration No. 3,031,006, for use in connection with "providing casino services within a hotel environment." (SBM's 56.1 Stmt. ¶ 14.) SBM's trademark is based on a bona fide intent to use the mark. (SBM's 56.1 Stmt. ¶ 14.)
Playshare argues that, inter alia, despite SBM's registration of CASINO DE MONACO, SBM has no protectable rights in its mark. Playshare's rationale is that SBM does not provide goods or services in the U.S., so that it has no trademark rights in the mark. ITC Ltd. v. Punchgini, Inc., 482 F.3d 135, 155 (2008) (a mark owner must take the proper steps to ensure that its rights to that mark are recognized in any country in which it seeks to assert them); see also American Express Co. v. Goetz, 515 F.3d 156, 161 (2d Cir. 2008) (service mark not in use if it is displayed in an advertisement for services that are nonexistent or will only hypothetically be available at some point in the future); Buti v. Impressa Perosa, S.R.L., 139 F.3d 98 (2d Cir. 1998) (service mark claimant did not provide its actual business services in the United States, but only advertised and promoted those services). Mere advertising and promotion of a mark in this country are not enough to constitute "use" of the mark "in commerce," to bring the activity within the scope of the Lanham Act.
SBM argues that it makes service-mark use in the U.S. of its mark in connection with an established business or trade.Morningside Group Ltd. v. Morningside Capital Group, L.L.C., 182 F.3d 133 (2d Cir. 1999) (U.S. business acquisitions, attracting U.S. co-investors, and directing money from U.S. banks to Asia is adequate activity for an investment firm under the Lanham Act).
Section 43(a) of the Lanham Act states:
(1) Any person who, on or in connection with any goods or services, . . . uses in commerce any word, term, name, symbol, or device, or any combination thereof, . . . which —
(A) is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person,
* * * * *
shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act.15 U.S.C. § 1125(a).
"Services," as used in the Lanham Act, has been defined as "the performance of labor for the benefit of another" (Advertising Marketing, 821 F.2d at 619, quoting In re Canadian Pac. Ltd., 754 F.2d 992, 994 (Fed. Cir. 1985)). Those services must not be "solely for the benefit of the performer; the services must be rendered to others" (Murphy v. Provident Mut. Life Ins. Co., 923 F.2d 923, 927 (2d Cir. 1990)). Further, the claimant must have used the claimed mark to identify its services (Advertising Marketing, 821 F.2d at 620).
In relation to SBM's mark CASINO DE MONACO, SBM's activities in the United States do not constitute "services" within the meaning of the Lanham Act. The record fully supports this finding by the Court.
In an effort to bolster its rights in the mark CASINO DE MONACO, SBM conflates it with the mark CASINO DE MONTE-CARLO. This may be in an attempt to create secondary meaning in the mark CASINO DE MONACO, which does not exist. First, CASINO DE MONACO is not an actual casino, while Casino de Monte-Carlo is a real casino. This matters because the use of place names in marks results in heightened scrutiny for those marks under the Lanham Act. Lack of use, coupled with the place name in the mark, severely weakens the likeliness that CASINO DE MONACO could retain any secondary meaning. Second, any secondary meaning that the mark CASINO DE MONACO can acquire vis-á-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." Streetwise Maps, Inc. v. VanDam, Inc., 159 F.3d 739, 743 (2d Cir. 1998) (a trademark should identify goods sold from a single source).
SBM's registration of Casino de Monaco required that it affirm that it had a bone fide intent to use the mark. 15 U.S.C. § 1126(d)(2). 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. (SBM's Opp. Br. p. 10.) 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. (SBM's Response to Playshare's 56.1 Stmt. ¶ 66.) 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. (SBM's Response to Playshare's 56.1 Stmt. ¶¶ 66-68.) However, all that SBM can show to support these representations are self-serving affidavits. (Id.) 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. The one real possibility that SBM could show activity in the United States is in the use of the mark CASINO DE MONACO in SBM's website. However, the record reflects that the webpages produced by SBM where created on or after April 14, 2008 (after this case began), and SBM can not show that anyone in the U.S. ever viewed the pages. (SBM's Response to Playshare's 56.1 Stmt. ¶¶ 121-23.) It does not bolster SMB's 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.
b. The mark CASINO DE MONTE-CARLO
SBM's utter lack of use of the mark CASINO DE MONACO anywhere, let alone in the United States, requires this Court to refuse to enforce SBM's right in the mark CASINO DE MONACO. This result is bolstered not just by SBM's lack of use, but by the fact that SBM hardly has any territorial connection with the United States for purposes of the Lanham Act. However, the Court finds that the limited activity is enough under the Lanham Act to protect SBM's purported right to the unregistered mark CASINO DE MONTE-CARLO because SBM actually utilizes that mark in the United States.Morningside Group Ltd., 182 F.3d at 138.
Under current guidance by the Second Circuit, whether SBM could maintain any mark in the United States is a close call. Compare Buti, 139 F.3d at 105 with Morningside Group Ltd., 182 F.3d at 138. This is not withstanding SBM's favorable ruling regarding its unregistered Casino de Monte-Carlo Mark in Inter International Bancorp, LLC v. Societe des Bains de Mer et du Cercle des, 329 F.3d 359 (4th Cir. 2003).
The rationale for this result is that SBM can show it uses its mark CASINO DE MONTE-CARLO in the U.S. For instance, SBM NY targets Americans to package, market and sell SBM's facilities in Monaco, including the Casino de Monte-Carlo. (SBM's Response to Playshare's 56.1 Stmt. ¶ 70.) Examples of SBM NY's sales of casino services, include, casino gift vouchers, actual chips, lines of credit, SBM Games Initiation and private rooms and/or admission at the Casino de Monte-Carlo. (Lambert Decl. ¶ 20.) SBM maintains a website (www.montecarlocasinos.com) that offers the casino gift vouchers and casino chips to U.S. residents. (Lambert Decl. ¶ 21.) SBM also offers all guests to its hotel properties a gold card to gain entrance to the Casino de Monte-Carlo. (Lambert Decl. ¶ 24.) While the activity in the record constitutes nothing more than promotional and advertising activity in the U.S., the activity does use and incorporate the mark CASINO DE MONTE-CARLO so that it constitutes "use" of the mark "in commerce," so as to bring the activity within the scope of the Lanham Act.
3. Likelihood of confusion
In determining whether there is a likelihood of confusion, the Court must apply the eight-factor balancing test introduced inPolaroid Corp. v. Polarad Elecs. Corp., 287 F.2d 492 (2d Cir. 1961); see also Starbucks Corp, 588 F.3d at 115. However, since the Court found that SBM's mark CASINO DE MONACO is not protectable, the Court does not need to engage in this analysis.
C. PLAYSHARE'S DECLARATORY JUDGMENT CLAIMS
The Declaratory Judgment Act provides that "[i]n a case of actual controversy within its jurisdiction . . . any court of the United States . . . may declare the rights and other legal relations of any interested party seeking such declaration. . . ." 28 U.S.C. § 2201. Sony Elecs., Inc. v. Guardian Media Techs., Ltd., 497 F.3d 1271, 1283 (Fed. Cir. 2007). Among other things, this means that "a court may not adjudicate `a difference or dispute of a hypothetical or abstract character' or `one that is academic or moot.'" Cat Tech LLC v. TubeMaster, Inc., 528 F.3d 871, 879 (Fed. Cir. 2008).
In Aetna Life Insurance Co. of Hartford, Connecticut v. Haworth, 300 U.S. 227 (1937), to meet the actual controversy standard, a dispute must be "definite and concrete, touching the legal relations of parties having adverse legal interests." Id. 300 U.S. 227, 240-41 (1937). The dispute must be "real and substantial," id. at 241, and it must "admi[t] of specific relief through a decree of a conclusive character, as distinguished from an opinion advising what the law would be upon a hypothetical state of facts." Id. See also MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 127 (2007) (quoting Aetna).
Here, it is clear there remains an actual controversy between the Parties necessitating the issuance of a declaratory judgment.
First, the Court has declined to exercise its supplemental jurisdiction over the state law claims in this case. An actual controversy still exists as to those claims.
Second, the Parties in this case are sophisticated business entities and persons. It is reasonable for the Court to assume that either Party will zealously protect its rights. Since the Parties will continue to operate in the similar business sectors, it is possible another dispute could arise. It is helpful if this Court spell out what the Parties rights are to the marks at issue in this case. While a threat of suit is not necessary to declaratory judgment jurisdiction, an aggressive litigation strategy (such as what was demonstrated in this three year litigation) may signal the existence of an actual controversy.See Micron Technology, Inc. v. Mosaid Technologies, Inc., 518 F.3d 897, 899-901 (Fed. Cir. 2008).
Accordingly, a declaratory judgment is appropriate in this action. Playshare seeks a declaratory judgment on three its three Counterclaims: (1) Playshare's use of the Monaco Domain Names is in compliance with the Anticybersquatting Consumer Protection Act; (2) SBM's "Casino de Monaco" U.S. Trademark, Registration No. 3,031,006, is invalid and unenforceable; and (3) SBM's unregistered mark CASINO DE MONTE-CARLO is unenforceable.
1. Playshare's use of the Monaco Domain Names
In this Opinion, the Court cancelled SBM's mark CASINO DE MONACO, as it does not constitute a protectable service mark under the Lanham Act. SMB's entire basis for its Cybersquatting Claim was predicated on the existence of SMB's mark CASINO DE MONACO. (See SBM's Second Amended Complaint ¶ 69-72.) Since the mark is no longer owned by SBM, as a matter of law, Playshare can not be in violation of the Anticybersquatting Consumer Protection Act, 15 U.S.C. § 1125(d)(1), in relation to its use of the Monaco Domain Names and any infringement of SBM's (former) mark CASINO DE MONACO. The Court vacates the WIPO Decision and the Monaco Domain Names shall remain with Lucan Toh and Maxwell Wright. Accordingly, the Court grants summary judgment in favor of Playshare on Counterclaim I and finds that a declaratory judgment is proper.
2. Unenforceability of SBM's mark CASINO DE MONACO
Similarly, as the Court cancelled SBM's mark CASINO DE MONACO, as a matter of law, the mark is invalid and unenforceable. Accordingly, the Court grants summary judgment in favor of Playshare on Counterclaim II and finds that a declaratory judgment is proper.
3. Unenforceability of SBM's mark CASINO DE MONTE-CARLO
In this Opinion, supra, the Court has found that that SBM has used its unregistered mark CASINO DE MONTE-CARLO in commerce as required under U.S.C. §§ 1051 and 1127. Therefore, for purposes of this dispute, the mark CASINO DE MONTE-CARLO is valid. Since SBM has not alleged any infringement of its mark CASINO DE MONTE-CARLO and, Playshare's Monaco Domain Names are not implicated by the enforceability of the mark CASINO DE MONTE-CARLO, the Court finds it should dismiss Counterclaim III as moot.
IV. CONCLUSION
On SBM's federal and state claims, the Court finds that SBM's mark CASINO DE MONACO, registered under U.S. Trademark Registration No. 3,031,006, is HEREBY CANCELLED as it does not constitute a protectable service mark under the Lanham Act. Accordingly, Playshare's Motion for Summary Judgment on all of SBM's federal claims is HEREBY GRANTED. The Court HEREBY DISMISSES, without prejudice, all of SBM's state law claims on the basis of declining to exercise supplemental jurisdiction under 28 U.S.C. § 1367(c)(3).On Playshare PLC, Lucan Toh, and Maxwell Wright Counterclaims, it is HEREBY DECLARED and ADJUDGED 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. In addition, UDRP Domain Name Decision Case No. D2007-0249WIPO decision is HEREBY VACATED; the Monaco Domain Names listed in Footnote No. 3 are to remain with Defendants Lucan Toh and Maxwell Wright. Playshare's Motion for Summary Judgment on the Counterclaims I and II is HEREBY GRANTED. Further, the Court DISMISSES Playshare's Counterclaims in COUNT III as moot. Finally, as the Court found that CASINO DE MONACO is not a protectable mark, Playshare's motion to strike Dr. Butters' expert report is moot. As all claims in this action have been dismissed, the Clerk is DIRECTED to close the docket in this case.
SO ORDERED.