Opinion
Civil No. 5-96-173 (JRT/RLE)
March 30, 2004
John D. Kelly, Mark D. Pilon, Emily K. John, HANFT FRIDE, Duluth, MN, for Plaintiffs
John P. Passarelli, McGRATH NORTH MULLIN KRATZ, Omaha, NE, for Defendant Bumble Bee Seafoods
MEMORANDUM OPINION AND ORDER
FACTUAL BACKGROUND
A more complete recitation of the underlying facts can be found in this Court's orders dated March 31, 2001 and September 30, 2002.
In 1987, plaintiff Louis Kemp ("Kemp") sold his line of surimi-based products to Oscar Mayer. As part of the sale, Kemp transferred to Oscar Mayer the trademarks KEMP, KEMP's and KEMP's Design for use in connection with the product line. A short time later, Kemp agreed to permit Oscar Mayer to register and use the trademarks LOUIS KEMP and LOUIS KEMP SEAFOOD COMPANY for marketing "surimi-based seafood products and such other seafood and fish accessory products within the natural zone of product expansion." This agreement was initially oral, but was subsequently memorialized in Amendment 1 to the 1987 sale contract. Oscar Mayer, through its parent company Kraft, sold the product line and LOUIS KEMP marks to Tyson, which in turn sold it to Bumble Bee Seafoods, Inc. ("Bumble Bee"), the current defendants.
Bumble Bee is wholly owned by ConAgra. Bumble Bee recently assigned the LOUIS KEMP marks to another wholly-owned subsidiary of ConAgra, ConAgra Foods Refrigerated Foods Division. For convenience, the Court will continue to refer to Bumble Bee.
Kemp, through his company Quality Finer Foods, Inc., began to market a line of wild rice based products under the Louis Kemp name. Bumble Bee objected to Kemp's use of the Louis Kemp name on a number of grounds, and Kemp brought an action for a declaratory judgment delineating the parties' rights to use the Louis Kemp name. Bumble Bee also brought a declaratory action, seeking a declaration that Bumble Bee owned all right and title to the LOUIS KEMP and LOUIS KEMP SEAFOOD COMPANY marks.
On March 31, 2001 this Court issued an order denying both parties' cross motions for summary judgment. The Court found that while Amendment 1 did not grant Kemp an affirmative contractual right to use the LOUIS KEMP and LOUIS KEMP SEAFOOD COMPANY marks for non-surimi based products, it also did not unambiguously grant defendants a contractual right to prevent Kemp from using the LOUIS KEMP or LOUIS KEMP SEAFOOD COMPANY marks on non-surimi products. The Court also noted "[i]t is clear that defendants acquired only a limited right to use and register LOUIS KEMP and LOUIS KEMP SEAFOOD COMPANY in connection with surimi-based seafood and related products."
On May 22, 2001, this Court signed a Stipulation and Order granting Consent Judgment ("Consent Judgment"). The Consent Judgment, which the parties negotiated and agreed to, referred to several California decisions and an underlying settlement agreement. The settlement agreement, in turn, was in part based on a bankruptcy proceeding. Kemp declared bankruptcy on November 27, 1996, and a Bankruptcy Estate Trustee was appointed to administer Kemp's assets. On behalf of Kemp's estate, the Trustee sold "all . . . right, title and interest in claims . . . relating to past and future use of the "Louis Kemp" name by [defendants], as well as any right, title and interest the Kemp estate had relating to the use and registration of the trademarks "Louis Kemp" and "Louis Kemp Seafood Company." The settlement agreement, entered into by Oscar Mayer/Kraft Foods, Tyson Foods, etc. and Carolyn Dye, the Chapter 7 Trustee in Bankruptcy for the Estate of Louis E. Kemp, was signed on February 3, 1998 and was approved by the U.S. Bankruptcy Court in California.
The settlement agreement provides, in relevant part:
2.5 Upon the payment of $100,000 to the Kemp Estate, . . . The Trustee . . . will also transfer any remaining rights, title and interest the estate might thereafter successfully reacquire in the trademarks "Louis Kemp" and "Louis Kemp Seafood Company", in addition to the Kemp, Kemp's and Kemp's Design trademarks. . . .
2.7 [T]he Trustee agrees to sell to Kraft and Kraft agrees to purchase, (1) any and all additional right, title and interest that the Bankruptcy Estate may acquire or reacquire relating to the past current or future use of the Louis Kemp name by [defendants] or any of their affiliates, transferees, successors, designees or assigns; (2) any and all right, title and interest in any trademark, tradename or any other right which Kemp purportedly transferred to Superior Seafoods and/or Quality Finer Foods; or which derived from said transfer; (3) any and all additional right, title and interest in claims the Bankruptcy Estate may have relating to the use and registration, of the names and trademarks "Louis Kemp" and "Louis Kemp Seafood Company".
2.8 [T]he Trustee shall . . . convey to [defendants] . . . any further right, title and interest she may hold on behalf of the Bankruptcy Estate of Louis E. Kemp in the use, rights and registration (including but not limited to any permission to use she may have), of the names and trademarks "Louis Kemp" and "Louis Kemp Seafood Company as well as any other rights transferred by Kemp or which derived therefrom. Trustee shall not oppose entry of the injunction sought by Tyson in its counterclaims filed in the Minnesota Litigation.
3.0 Release. The Trustee . . . does hereby release and forever discharge [defendants and any predecessors or successors] from all of their right, title and interest in past, present or future claims, demands, obligations, actions, or causes of action however denominated for any injury, damage or loss arising directly or indirectly from any of the events or circumstances arising from or relating to the claims that were brought, or could have been brought, in [the California and Minnesota Litigations] including, but not limited to all claims, whether known or unknown, that were or that could have been asserted based on the Stock Acquisition Agreement and Amendment No. 1, (the sale of the Louis Kemp Seafood Company, and use or registration of the Louis Kemp or Louis Kemp Seafood Company names and tradenames).
5.1 This Agreement is an integrated contract and contains the entire agreement between the parties; there are no prior or contemporaneous terms or conditions not here presented.
Based on the preclusive effect of these decisions and settlement, the Consent Judgment granted defendant's declaratory judgment claim while dismissing with prejudice Kemp's declaratory judgment claim. When Kemp delivered the signed Consent Judgment to the Court and to defendants, a cover letter was attached asserting that the Consent Judgment was "subject to the Court's Decision and Order contained therein, particularly, but without limitation, the Court's determination that `the defendants acquired only a limited right to use and register LOUIS KEMP and LOUIS KEMP SEAFOOD COMPANY in connection with surimi-based seafood and related products.'" Kemp has also submitted several affidavits to the effect that the Consent Judgment was intended to reflect the conclusion that defendants retained only the right to use the LOUIS KEMP and LOUIS KEMP SEAFOOD COMPANY marks to the same extent that Oscar Mayer had had that right. The Consent Judgment itself, however, makes no mention of limitations on defendants' right to use the marks it owns.
The Consent Judgment provides in relevant part:
6. The California litigations have now been resolved by means of a demurrer and grant of summary judgment in favor of Tyson in the California state trial court (i.e., in No. BC133535 (Super.Ct. Los Angeles County)) coupled with a settlement agreement signed by all of the parties to those litigations and the parties to the present litigation, other than Bumble Bee Seafoods, Inc., which settlement has been approved by the California bankruptcy court.
7. Pursuant to the doctrine of res judicata, the Court finds that Tyson owns all right, title, and interest in and to the LOUIS KEMP Marks, and Tyson owns U.S. Trademark Registration Nos. 1,859,815 and 1,859,816 (for the mark LOUIS KEMP) and U.S. Trademark Registration Nos. 1,859,817 and 1,879,931 (for the mark LOUIS KEMP SEAFOOD CO.). Accordingly, the Court hereby grants judgment to Tyson on its claim for declaratory judgment (Am. Ans., Aff. Def. Ctrcls., Ctrcl. I PP 32-36).
8. Tyson's LOUIS KEMP Marks are valid, enforceable, and in full force and effect.
9. Based on the findings in paragraphs 7 and 8 above, the Court hereby dismisses with prejudice, pursuant to the doctrine of res judicata, all claims advanced by Kemp against Tyson related to ownership of the Marks: (1) declaratory judgment (Compl. PP VI-IX) . . .
11. Accordingly, the only issues remaining in the present litigation are whether the use by Kemp of the trademark LOUIS KEMP or any formative of this mark in connection with rice products . . . infringes and/or dilutes Tyson's rights in the LOUIS KEMP Marks.
On September 30, 2002, following a bench trial, this Court issued a Judgment in favor of Kemp on the remaining issues of federal and state law trademark infringement and dilution. The Court found that Kemp's use of the Louis Kemp name in relation to his line of wild rice products did not either infringe or dilute Bumble Bee's LOUIS KEMP and LOUIS KEMP SEAFOOD COMPANY trademarks.
Bumble Bee is currently in the process of introducing a line of smoked salmon under the LOUIS KEMP mark. Kemp requests an injunction prohibiting the use of the LOUIS KEMP mark in relation to the salmon because it is a non-surimi based product. As mentioned above, Kemp maintains that Bumble Bee's rights extend only to surimi-based products. Initially, Bumble Bee asserts that the Court does not have jurisdiction to hear this claim. Further, Bumble Bee claims that the Consent Judgment grants it full ownership and use of the marks dismissed with prejudice all claims related to ownership of the marks. Bumble Bee maintains that Kemp is thus prevented from raising this claim. Finally, Bumble argues that Kemp has not demonstrated the factors necessary for an injunction.
I. Jurisdiction
Kemp brings this motion under 28 U.S.C. § 2202, which provides:
Further necessary or proper relief based on a declaratory judgment or decree may be granted, after reasonable notice and hearing, against any adverse party whose rights have been determined by such judgment.
Section 2202 is not a separate jurisdictional basis, but rather requires a prior award of declaratory relief. Hatridge v. Aetna Casualty Surety Company, 415 F.2d 809, 812 (8th Cir. 1969).
In the underlying case, both Kemp and Bumble Bee sought declaratory judgment. Paragraph 7 of the Consent Judgment granted judgment to defendant on its claim for declaratory judgment; paragraph 9 dismissed Kemp's claim for declaratory judgment. There was thus an award of declaratory relief in this matter. Bumble Bee claims that § 2202 only permits a party who brings and prevails on a declaratory judgment claim to request "further" relief, precluding Kemp from using § 2202 as a basis for jurisdiction.
Although the situation that defendant presents would certainly be the more common situation, the Court is not convinced that it is the only permissible use of § 2202. To understand § 2202 as Bumble Bee urges would foreclose an obvious channel of relief to a party on the losing end of a declaratory judgment who believes that the prevailing party has overstepped the bounds of the judgment. It simply does not make sense to require such a party to begin a new action, before a new court unfamiliar with the facts of the case, essentially seeking interpretation and enforcement of the declaratory judgment. The Court thus finds that this matter is properly before the Court pursuant to 28 U.S.C. § 2202.
However, in the event that jurisdiction cannot be based on § 2202, the matter is nevertheless properly before the Court. This Court explicitly retained jurisdiction over the Consent Judgment. Where a court has expressly retained jurisdiction over an agreement between the parties or where the terms of an agreement are incorporated into the court's order, the court has ancillary jurisdiction to enforce the agreement. Kokkonen v. Guardian Life Insurance Company of America, 511 U.S. 375, 381 (1994). "Included in a district court's power to administer its decrees is the power to construe and interpret the language of the original order." Securities and Exchange Commission v. Hermil, Inc., 157 F. Supp.2d 583, 1153 (11th Cir. 1988) (citing South Delta Water Agency v. United States, 767 F.2d 531, 541 (9th Cir. 1985). Kemp confirmed at the hearing on this matter that he is essentially asking the Court to clarify the effect of the Consent Judgment in light of the Summary Judgment order.
II. Injunction
A. Factors
In determining whether to grant injunctive relief, the Court applies the framework set out in the now-familiar Dataphase Sys., Inc. v. CL Sys., Inc., 640 F.2d 109, 114 (8th Cir. 1981) (en banc). Dakota Industries, Inc. v. Dakota Sportswear, Inc., 988 F.2d 61 (8th Cir. 1993). Under Dataphase, the Court considers four factors: (1) the moving party's likelihood of success on the merits (2) the threat of irreparable harm to the party seeking relief, (3) the balance of the potential harms to the two parties, and (4) the public interest. Id. Although no one factor is dispositive, id., the first factor, likelihood of success on the merits, is often considered the most important of the factors. Shrink Missouri Government PAC v. Adams, 151 F.3d 763, 764 (8th Cir. 1998).
B. Likelihood of Success on the Merits
As an initial matter, the Court notes that Kemp's current motion does not allege that Bumble Bee's use of LOUIS KEMP in connection with smoked salmon infringes or otherwise violates a mark held by Kemp. There is no evidence before the Court of any currently registered trademarks held by Kemp involving his name. Further, as the Court noted previously, the bankruptcy trustee administering Kemp's estate sold "any remaining rights, title, and interest . . . in the trademarks Louis Kemp, Louis Kemp Seafood Company . . . Kemp, Kemp's and Kemp's Design" as well as "any and all additional right, title, and interest . . . relating to the past, current, or future use of the Louis Kemp name."
Rather, Kemp grounds his request for injunctive relief in this Court's statement in the March 31, 2001 summary judgment order that Oscar Mayer, and any successors in interest, acquired only a limited right to use the marks. According to Kemp, if Oscar Mayer and its successors in interest acquired only a limited right, then Kemp must have the right to enforce those limits.
An individual who does not hold a trademark of his personal name may nevertheless challenge another party's use of his name in certain circumstances. Section 2(c) of the Lanham Act, 15 U.S.C. § 1052(c), bars the registration of a trademark identifying a living individual without that person's written consent. An individual who has not consented to registration of his name can raise violation of § 2(c) to bar or, possibly, revoke registration. 2 McCarthy on Trademarks and Unfair Competition § 13:37 (4th ed.); Gilbert/Robinson, Inc. v. Carrie Beverage-Missouri, Inc., 989 F.2d 985, 989 (8th Cir. 1993). However, § 2(c) is triggered only if the real person will be associated with the goods marketed under his name because that person is so well known that the public will assume an association or because that person is publicly connected with the business in which the mark is being used. McCarthy § 13:37 (citing Trademark Manual of Examining Procedure § 1206.03 (1986 rev.)).
Initially, as is discussed in more detail below, the Consent Order entered into by Kemp and Tyson grants Tyson, and by extension Bumble Bee, the right to register and use the LOUIS KEMP and LOUIS KEMP SEAFOOD COMPANY trademarks. Thus, Bumble Bee's registered trademarks likely cannot be considered unconsented to. Further, while Kemp's name may be well known, as an individual he has not yet achieved celebrity status. See Parks v. LaFace Records, 329 F.3d 437, 447 (6th Cir. 2003) (defining celebrity). The Court also cannot say that Kemp, as an individual, is so well known in the packaged-food industry that he will necessarily be associated with Tyson's smoked salmon product. Indeed, the Court understands that Kemp has not marketed packaged seafood in a number of years, and Kemp's sale of his previous product line is well known. Cf Ross v. Analytical Technology Inc., 1999 WL 517200 (Trademark Trial App. Bd. 1999). Kemp would thus be unlikely to prevail on a claim under § 2(c).
Additionally, even if Kemp were to prevail on a § 2(c) claim, he would not necessarily get the relief he seeks through this action. While § 2(c) might bar registration of a mark, it does not necessarily mean that use of the underlying name is prohibited. McCarthy § 13:37.
Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), creates a civil cause of action against any person who identifies a product in such a way as to cause confusion among consumers as to the products' association with a celebrity. Parks, 329 F.3d at 445-46; see also Downing v. Abercrombie Fitch, 265 F.3d 994, 1007 (9th Cir. 2001); Donoghue v. IBC USA Publications, Inc., 70 F.3d 206, 218 (1st Cir. 1995). Courts have found that celebrities have a protectable interest in their names sufficiently akin to a trademark right to warrant protection under § 1125(a). Id. Additionally, a number of states recognize, and in some cases have codified, the common law tort of right of publicity that protects the identity of a celebrity from exploitive commercial use. See, e.g., Parks, 329 F.3d at 459-460 (Michigan); Downing, 265 F.3d at 1001 (California); Donoghue, 70 F.3d at 218 (Massachusetts); McFarland v. Miller, 14 F.3d 912, 918 (3rd Cir. 1994) (New Jersey). Again, however, Kemp is not a celebrity and therefore cannot challenge Bumble Bee's use and/or registration of his name as a trademark.
Even if Kemp does have some right to challenge Bumble Bee's use of its trademarks, the Court believes that Kemp will be unlikely to succeed on the merits of the claim. The Court found that Oscar Mayer, through its purchase of Kemp's surimi-based product line, acquired only a limited contractual right to register and use the words LOUIS KEMP. A limited contractual right does not prevent Oscar Mayer and its successors in interest from subsequently expanding that right either contractually or otherwise. In this case, the Consent Order, which Kemp entered into and this Court signed, affirmatively granted Tyson/Bumble Bee "all rights, title, and interest in and to the LOUIS KEMP marks" and acknowledged that Tyson owns the mark LOUIS KEMP and LOUIS KEMP SEAFOOD CO. The Consent Order dismissed "all claims advanced by Kemp against Tyson related to ownership of the Marks." There are no restrictions placed on Tyson's registration, ownership, or use of the LOUIS KEMP and LOUIS KEMP SEAFOOD CO. marks. This language is unambiguous and simply cannot be read to include the possibility that the scope of Tyson's marks continued to be limited to surimi-based products. If such a limitation was intended, it should have been included in the Consent Order.
Finally, in the Findings of Fact, Conclusions of Law, and Order for Judgment filed September 30, 2002, this Court determined that Kemp's use of his personal name, Louis Kemp, in connection with a line of wild rice products did not infringe or impermissibly dilute the trademarks LOUIS KEMP and LOUIS KEMP SEAFOOD COMPANY held by Bumble Bee. In so finding, the Court implicitly determined that Kemp retained some right to use his name. However, the fact that Kemp may be entitled to use his name does not also grant him the right to prevent or otherwise police Bumble Bee's use of its trademarks.
For all of the above reasons, the Court finds that Kemp is not likely to prevail on his claim that Bumble Bee is not entitled to use the LOUIS KEMP trademark in connection with its smoked salmon product line.
C. Irreparable Harm
In a typical trademark case where the plaintiff alleges likelihood of confusion, irreparable harm can be presumed if the plaintiff has demonstrated a likelihood of prevailing on the merits. See General Mills, Inc. v. Kellogg Co., 824 F.2d 622, 625 (8th Cir. 1987). However, as noted above, Kemp does not own a competing mark and it is unlikely that he has any other relevant protectable interest. He is not currently marketing any products under the name Louis Kemp. In these circumstances, Kemp cannot demonstrate that he will suffer irreparable harm if the injunction does not issue. See Cellular Sales, Inc. v. Mackay, 942 F.2d 483 (8th Cir. 1991) (no irreparable harm where no evidence of lost sales).
Kemp asserts that without an injunction Bumble Bee will have no incentive to negotiate in good faith with Kemp for the expansion of the use of the marks. The Court notes that if, in fact, Kemp is entitled to prevent Bumble Bee's use of its marks on additional products, Kemp can seek damages and other relief from Bumble Bee in the form of whatever he would have demanded before granting the permission. This factor does not favor Kemp.
D. Balance of Harms
The Court is aware that Bumble Bee is in the process of rolling out its line of smoked salmon under the LOUIS KEMP trademark in multiple markets. An injunction preventing Bumble Bee from using the LOUIS KEMP in relation to that product would likely cost Bumble Bee a substantial sum of money in lost product and marketing. In contrast, as noted above, the potential harm to Kemp of not having an injunction issue is minimal. This factor does not favor Kemp.
E. Conclusion
In light of the fact that the above three factors weigh against Kemp, the Court finds that Kemp has not carried his burden of demonstrating that an injunction is properly issued. In the Court's view, Kemp has retained some right to use his own personal name in marketing food products that do not impermissibly dilute Bumble Bee's use of its trademarks, but because of the Consent Order, that limited right does not afford Kemp the ability to prevent or otherwise police Bumble Bee's use of its trademarks.
Given the Court's analysis and decision, the Court finds that Plaintiff's additional submissions that are the subject of Bumble Bee's Motions to Strike did not prejudice Bumble Bee and need not be stricken.
ORDER
Based on the foregoing, all the records, files, and proceedings herein, IT IS HEREBY ORDERED that:
1. Plaintiffs' Motion for Summary Injunction [Docket No. 155] is DENIED.
2. Defendant Bumble Bee Seafoods' Motions to Strike evidentiary submissions [Docket No. 167] and affidavits of Louis Kemp dated 10/23/03, John D. Kelly dated 10/23/03, Mark Pilon dated 10/15/03 and supplemental affidavit of Louis E. Kemp dated 11/3/03 [Docket No. 170] are DENIED.