Opinion
00 Civ. 4556 (LAK)
June 12, 2003.
ORDER
This matter, which initially was assigned to the late Judge Schwartz, now is before the Court on a motion to enter a permanent injunction against defendants Pine Tavern, Inc., Frank and John's Ristorante, Inc. and AA Restaurant, Inc. (the "Defendants"). These defendants consent to the entry of a permanent injunction and, indeed, to the precise prescriptive language sought by plaintiff. The parties are at loggerheads over those portions of plaintiff's proposed injunction that would impose attorneys' fees and costs upon defendants and provided for what amount to liquidated damages in the event of any uncured breach of the injunction. It is necessary also to determine what, if anything, else remains to be resolved in this action.
The Form of the Injunction
According to papers submitted on the present motion, plaintiff, the Defendants named above, and Anthony Bastone entered into a settlement agreement and mutual release dated as of January 9, 2001. In relevant part, the Defendants and Mr. Bastone covenanted that they would "not, directly or indirectly, use the name of FRANKIE AND JOHNNIE'S, or any similar variation of that name or part thereof, . . ." [Docket Item 23, Ex. A, Settlement Agreement § 1.1] The agreement further provided for a transition period during which these defendants would bring themselves into compliance. Plaintiff agreed to discontinue this action without prejudice "so long as the [ Defendants] abide by the letter and spirit of their covenants . . ." [Id. § 2.1] At the same time, plaintiff granted to Bastone "a national, non-exclusive, non-transferable, limited use license to the mark and name `F J' in association with restaurant services only" at a particular location in the Bronx. [Id., License Agreement § 1.1]
For reasons that are not clear from the docket sheet or the file, the action remained on the active docket, notwithstanding this apparent settlement, until May 20, 2002, when Judge Schwartz entered an order of discontinuance that permitted restoration of the action if the settlement was not "effectuated" within 60 days. [Docket Item 18] Less than 30 days later, however, the action was reopened, although it remained entirely dormant until April 3, 2003 when plaintiff moved for a permanent injunction which, in substance, would have enforced the Settlement Agreement.
On April 25, 2003, Judge Martin issued a temporary restraining order against the Corporate Defendants' continued use of the Frankie Johnnie's mark and directed them to show cause, on or before May 2, 2003, why a permanent injunction should not issue. [Docket Item 22] On May 1, 2003, defendants' counsel sought, and the Court granted, a two week extension and agreed to extension of the TRO. [Docket Item 22] The period and the TRO were extended again for an additional week, opposing papers being due on May 23, 2003. [Docket Item 25]
Two papers in the file are denominated "22." This refers to the letter dated May 1, 2003 and endorsed order.
Notwithstanding the extensions, defendants never submitted any opposition to the motion for entry of a permanent injunction. Instead, by letter dated May 28, 2003, they consented "to that portion of . . . [plaintiff's proposed] Permanent Injunction that relates to the proscribed conduct" but, as noted above, took exception to other aspects of the order.
1. Attorneys' Fees
Under the so-called American rule, litigants are required to bear their own attorneys' fees unless otherwise provided by contract or statute.
In this case, the Settlement Agreement which plaintiff seeks to enforce makes no provision for any award of attorneys' fees in the event of breach. Hence, to the extent the present motion properly is regarded as one to enforce the settlement agreement, there is no basis for any award.
Section 35(a) of the Trademark Act, as amended, 15 U.S.C. § 1117(a), does permit a court, in "exceptional" cases, typically wilful infringement, to award attorneys' fees. Plaintiff, however, has made no effort to demonstrate that it is entitled to relief under this statute, which its memorandum of law does not even bother to cite. [Docket Item 23, at 8] The Court therefore declines to find that this is an exceptional case.
The request for fees is denied.
2. Liquidated Damages
Plaintiff's proposed form of permanent injunction, if entered, would provide that plaintiff would be entitled, in the event of a breach of the injunction that remained uncured more than three days after notice thereof, to a monetary award of $1,000 per day for each violation plus the cost of any corrective advertising required by plaintiff plus attorneys' fees and other costs in bringing such violations to the attention of defendants and/or the Court, as well as additional relief.
Plaintiff has cited no legal basis for any such provision, and the Court is aware of none. In the event defendants violate the injunction, plaintiff has its remedies.
Other Matters
Having determined the form of the permanent injunction that will enter, it remains to clean up the loose ends disclosed by a review of the docket sheet in order to determine whether the action may be closed.
Plaintiff initially sued Pine Tavern, Inc. and ABC Restaurant Corporation, Inc., a pseudonym intended to represent a corporation of then unknown name operating a restaurant in New Rochelle. [Cpt ¶¶ 4, 6] As the caption confusingly contained also, beneath each corporate defendant's name, a block entitled "SERVE:", one of which identified Anthony Bastone and the other "Managing Agent ABC Restaurant Corporation, Inc.," the docket sheet mistakenly listed Mr. Bastone and "Managing Agent" as defendants.
An answer then was filed by Pine Tavern, Inc. and Frank and John's Ristorante, Inc., which were said by defendants to have been named incorrectly as ABC Restaurant Corporation, Inc. [Docket Item 4] In addition, an entity known as A A Restaurant Corporation was added as a counterclaimant.
The answer erroneously refers to plaintiff also as a third-party defendant and to A A as a third-party plaintiff No third party complaint ever was served in this action.
On September 29, 2000, plaintiff served an amended complaint, this time naming as defendants Pine Tavern, Inc., Frank John's Ristorante, Inc. and A A Restaurant, Inc. [Docket Item 11] The answer to the amended complaint and counterclaim was filed on behalf of these three entities.
The New York Department of State on-line database contains no listing for a domestic corporation know as A A Restaurant Corporation. It confirms that A A Restaurant, Inc. is the correct name of the entity.
Accordingly, the parties to this action are plaintiff and defendants Pine Tavern, Inc., Frank and John's Ristorante, Inc., and A A Restaurant, Inc.
The entry of the permanent injunction will finally resolve the claims of plaintiff against all the defendants. Although no one has mentioned disposition of the counterclaim in the present papers, the Settlement Agreement provides that defendants release plaintiff "from any and all claims now existing or hereafter arising . . . relating to" this case. [Docket Item 23, Ex. A, Settlement Agreement § 3.2] Accordingly, the parties plainly intend that entry of the permanent injunction finally resolve the case.
Conclusion
The caption of the action is amended to reflect the fact that the only defendants in the case are Pine Tavern, Inc., Frank and John's Ristorante, Inc., and A A Restaurant, Inc.
SO ORDERED.