Opinion
10 Civ. 1464 (CM).
May 4, 2010
OVERVIEW
On February 22, 2010, the New York City Triathlon, LLC ("Plaintiff") filed a motion for an order to show cause seeking a preliminary injunction, pursuant to Federal Rule of Civil Procedure 65, to prevent and restrain New York City Triathlon Club (also "NYC Triathlon Club" or "Defendant") from using "NYC Triathlon Club," "NYC Tri Club," and "New York City Triathlon Club" ("Defendant's Marks" or the "Club Marks") as names, trade names or trademarks, or as a domain name on the Internet, or in any other way that is likely to cause confusion with Plaintiff or its trade name and trademarks, NEW YORK CITY TRIATHLON, NYC TRIATHLON, and NYC TRI ("Plaintiff's Marks" or the "NYC TRIATHLON Marks").
Defendant (a corporation) failed to appear by counsel and therefore defaulted on the motion. As a result, on March 9, 2010, the Court issued a written decision preliminarily enjoining Defendant from ongoing trademark and trade name infringement, including the use of any name or mark confusingly similar to Plaintiff's Marks. See New York City Triathlon, LLC v. NYC Triathlon Club, Inc., No. 10 Civ. 1464, 2010 WL 808885 (S.D.N.Y. Mar. 9, 2010) ("March 9, 2010 Decision and Order"); see also Order to Show Cause, Mar. 18, 2010. Familiarity with the Court's decision is presumed.
One and a half weeks later, on March 18, 2010, Plaintiff filed a motion to enforce the preliminary injunction, alleging, among other things, that Defendant's "new" name for its company — "Triathlon Club NYC" — merely rearranges the club's old name, and so continues to infringe on Plaintiff's Marks because it is confusingly similar to one or more of Plaintiff's Marks. Plaintiff also alleges that Defendant has wantonly disregarded this Court's order, by failing to discontinue use of infringing marks on various social networking sites, including Twitter. Finally, Plaintiff alleges that Defendant most recently violated the Court's injunction by promoting its club at the Multisport World Conference and Expo under the name "New York City Triathlon Club" — the name this Court enjoined it from using on March 9, 2010. (Decl. of V. Brumfield, Apr. 19, 2010 ("Brumfield Decl.") ¶¶ 3-4.)
Defendant, now appearing by counsel, opposes Plaintiff's motion and cross-moves to vacate the preliminary injunction. For the reasons set forth below, Plaintiff's motion to enforce the injunction is granted, and Defendant's motion to vacate is denied.
DISCUSSION
A district court has complete power over its interlocutory orders, including preliminary injunctions, permitting it to afford relief as necessary. Fed.R.Civ.P. 60(b); Ideal Toy Corp. v. Sayco Doll Corp., 302 F.2d 623, 625 (2d Cir. 1962). Additionally, this Court has plenary power over a preliminary injunction and has the equitable discretion to vacate or revise it. Update Art, Inc., v. Charnin, 110 F.R.D. 26, 35-36 (S.D.N.Y. 1986).
I. Preliminary Injunctive Relief
In the Second Circuit, a party seeking a preliminary injunction has historically been required to demonstrate that it will suffer irreparable harm absent injunctive relief, and either (1) that it is likely to succeed on the merits of the action; or (2) that there are sufficiently serious questions going to the merits to make them a fair ground for litigation, provided that the balance of hardships tips decidedly in favor of the moving party.Citigroup Global Mkts., Inc. v. VCG Special Opportunities Master Fund Ltd., 598 F.3d 30, 35 (2d Cir. 2010) (internal quotations and citation omitted); accord Time Warner Cable, Inc. v. DIRECTV, Inc., 497 F.3d 144, 152-53 (2d Cir. 2007) (applying the standard to Lanham Act claims).
However, the Circuit has recently revisited the standard for injunctive relief in the context of an action for copyright infringement. It concluded that its "longstanding standard . . . is inconsistent with the `test historically employed by courts of equity' and has, therefore, been abrogated by eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006)." See Salinger v. Colting, No. 09 Civ. 2878, 2010 WL 1729126, at *5 (Apr. 30, 2010). In Salinger, the court held that a preliminary injunction should issue upon a showing of a plaintiff's likelihood of success on the merits only where the plaintiff has also shown that: (1) "he is likely to suffer irreparable injury in the absence of an injunction"; (2) "remedies at law, such as monetary damages, are inadequate to compensate for that injury"; (3) the balance of hardships tips in his favor; and (4) "the `public interest would not be disserved' by the issuance of a preliminary injunction." Id. at *9 (citing eBay, 547 U.S. at 391). Although the Salinger court made clear that its holding was "limited to preliminary injunctions in the context of copyright cases," the court also explained that it saw "no reason that eBay would not apply with equal force to an injunction in any type of case." Salinger, 2010 WL 1729126, at *7 n. 7 (emphasis in original).
The Court understands Salinger as indicating that the standard for injunctive relief historically applied in this jurisdiction must be abandoned in favor of the one articulated by the Supreme Court (whose mandates we are all bound to follow) in eBay. The Court can think of no reason why the standards for injunctive relief articulated by the High Court in a copyright infringement case might not apply in a trademark infringement case. Accordingly, this Court analyzes New York City Triathlon LLC's claims by applying the five-fold test of eBay and Salinger.
II. Likelihood of Success on the Merits
A trademark is defined in 15 U.S.C. § 1127 as including "any word, name, symbol, or device, or any combination thereof" used by any person "to identify and distinguish his or her goods, including a unique product, from those manufactured or sold by others and to indicate the source of the goods, even if that source is unknown." In order to be registered, a mark must be capable of distinguishing the applicant's goods from those of others. 15 U.S.C. § 1052.
Following the classic formulation set out by Judge Friendly, marks may be classified into one of five categories by order of increasing distinctiveness; (1) generic; (2) descriptive; (3) suggestive; (4) arbitrary; or (5) fanciful. See Abercrombie Fitch Co. v. Hunting World, Inc., 537 F.2d 4, 9 (2d Cir. 1976). "The latter three categories of marks, because their intrinsic nature serves to identify a particular source of a product, are deemed inherently distinctive and are entitled to protection." Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763, 768 (1992). By contrast, generic marks — those that refer "to the genus of which the particular product is a species" — can never be registered as trademarks. Abercrombie Fitch, 537 F.2d at 9.
A mark that is merely descriptive of a product is not inherently distinctive and therefore merits protection only once it has acquired "secondary meaning." Park `N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S. 189, 194 (1985); Two Pesos, Inc., 505 U.S. at 769. A mark obtains secondary meaning in one of two ways: "it may be proved as a matter of fact that the mark connotes a single source of origin to the public consumer or secondary meaning may be established through registration of a trademark." Gruner + Jahr USA Publ'g v. Meredith Corp., 991 F.2d 1072, 1976 (2d Cir. 1993).
To prevail in a trademark infringement action under the Lanham Act, a plaintiff must prove both that its mark is protectable and that there is "a probability [likelihood] of confusion" affecting "numerous ordinary prudent purchasers." Id. at 1077. "Likelihood of confusion includes confusion of any kind, including confusion as to source, sponsorship, affiliation, connection, or identification." Guinness United Distillers Vintners B.V. v. Anheuser-Busch, Inc., 64 U.S.P.Q.2d 1039, 1041 (S.D.N.Y. 2002) (citing McDonald's Corp. v. McBagel's, Inc., 649 F. Supp. 1268, 1273 (S.D.N.Y. 1986)). "In order to be confused, a consumer need not believe that the owner of the mark actually produced the item and placed it on the market. The public's belief that the mark's owner sponsored or otherwise approved the use of the trademark satisfies the confusion requirement." Dallas Cowboys Cheerleaders, Inc. v. Pussycat Cinema, Ltd., 604 F.2d 200, 204-05 (2d Cir. 1979) (internal citations omitted).
In this case, Defendant argues that the Court's original findings should be vacated for three reasons. First, Defendant asserts that Plaintiff's Marks are generic — not descriptive — and, therefore, are not entitled to trademark protection. (Def.'s Br. at 9-12.) Second, Defendant opines that to the extent Plaintiff's Marks could be considered descriptive, they are not protectable because they have not acquired secondary meaning. (Id. at 12-14.) Third, Defendant argues in the alternative that there is no likelihood of confusion between Plaintiff's and Defendant's Marks and therefore Defendant's Marks are noninfringing. (Id. at 15-21.)
Each of these arguments is without merit.
A. Plaintiff's Marks are Protectable
Plaintiff's Marks are descriptive, not generic, as Defendant contents. It is well-settled that geographic terms, even when coupled with a generic term (e.g., "New York City" plus "triathlon"), are considered descriptive rather than generic. See New York Stock Exchange, Inc. v. New York, New York Hotel, LLC, 293 F.3d 550, 557 (2d Cir. 2002) (holding "New York," plus generic term "stock exchange" was descriptive). The United States Patent and Trademark Office (the "PTO") recognizes this basic principle, having permitted the registration of both "LOS ANGELES TRIATHLON" and "CHICAGO TRIATHLON" (see Decl. of J. Caress, Mar. 25, 2010 ("Caress Decl."), ¶ 5; Decl. of J. Caille, Mar. 25, 2010 ("Caille Decl."), ¶ 5), neither of which would be protectable, and therefore registrable as marks, if they were merely generic,see Abercrombie Fitch, 537 F.2d at 9.
Plaintiff's Marks have also acquired secondary meaning, contrary to Defendant's argument.
In determining whether descriptive marks, like Plaintiff's, have acquired secondary meaning (and are therefore protectable), the Second Circuit has set forth a number of relevant considerations that must be analyzed: (1) advertising expenditures; (2) sales success; (3) unsolicited media coverage of the product; (4) attempts to plagiarize the mark; (5) the length and exclusivity of the mark's use; and (6) consumer studies linking the name to a source. See Thompson Med. Co. v. Pfizer Inc., 753 F.2d 208, 217 (2d Cir. 1985); see also New York City Triathlon, 2010 WL 808885, at *3.
As this Court explained in its March 9, 2010 Decision and Order, there is more than enough evidence in the record for the Court to conclude that Plaintiff's marks have acquired secondary meaning. This year, the New York City Triathlon will celebrate its tenth anniversary as the only Olympic distance triathlon to take place in the rivers, streets and parks of New York City. (Decl. of J. Korff, Feb. 22, 2010 ("Korff Decl.") ¶ 27.) Until this year, when Defendant changed its name from the SBR Triathlon Club to the New York City Triathlon Club, Plaintiff had been the exclusive user of the NYC TRIATHLON Marks during the triathlon's ten years of existence. (Id. ¶ 42.) Plaintiff has also been extremely protective of the exclusivity and use of its marks, requiring all sponsors to seek its written approval before using them on any goods, services or literature they publish or distribute. (Id. ¶ 34.) Plaintiff has policed unauthorized use of its marks (see id.), and has filed trademark applications for its NYC TRIATHLON Marks with the PTO (id. ¶ 43), which are currently pending.
Plaintiff's race has received tremendous solicited and unsolicited media coverage, including television coverage on CNN, NBC, CBS, ABC, FOX, SNY, the BBC, YES Network, Fox Sports Network, the Outdoor Life Network, and the Weather Channel; and newspaper coverage in the New York Times, New York Post, Wall Street Journal, USA Today, and the Associated Press. (Pl.'s Br. at 7-8; Korff Decl. ¶¶ 16, 17, 20-23 Exs. B-Q.) Plaintiff's principal, John Korff, has been interviewed repeatedly and quoted extensively in the press about the race. (Pl.'s Br. at 6 (citing Korff Decl. Ex. Q; Supplemental Decl. of J. Korff, Mar. 26, 2001, Ex. B).) Plaintiff has engaged in a largescale advertising campaign, placing ads in the Wall Street Journal, New York Post, Metro Sports NY, and "every major triathlon magazine." (Korff Decl. ¶ 23.) Plaintiff has also advertised on CBS, FOX and radio stations, including Z-100 and W-FAN. (Id. Ex. R.)
Plaintiff's event is clearly a commercial success, having sold out all 5600 entry spots in 6 minutes 43 seconds, after they went on sale at 12:01 a.m. on November 1, 2009. (Korff Decl. ¶ 27.) The event grosses approximately $2.3 million annually, which reflects its widespread appeal and name recognition — it has been viewed by over 60 million people in the United States and over a billion worldwide. (Korff Decl. ¶¶ 16, 38.) Defendant's plagiarism of Plaintiff's name only highlights the value of the "New York City Triathlon" brand, since intentional copying is persuasive evidence of secondary meaning. Le Sportsac, Inc. v. K Mart Corp., 754 F.2d 71, 78 (2d Cir. 1985). And Plaintiff's panoply of corporate sponsors, which at various times has included Dasani water, Delta Airlines, Visa, JetBlue, Janus Capital Group, Toyota, News Corp., Nautica and Ford, does nothing to undermine Plaintiff's assertion that the New York City Triathlon is among the premier triathlons worldwide, with widespread name recognition. (Id. ¶¶ 15, 26.)
Defendant argues that this abundant evidence is insufficient to support a finding of secondary meaning for two reasons: (1) Plaintiff's use of its marks has not been exclusive, because it has co-existed with an organization using the name "New York Triathlon Club," and (2) Plaintiff cannot be identified as the sole sponsor of the race because Plaintiff has allowed other corporate sponsors to affiliate with the event by affixing their house marks to the race name on promotional materials (e.g., NAUTICA New York City Triathlon, FORD New York City Triathlon). (Def.'s Br. at 13-14.) The Court finds neither argument persuasive.
All that is necessary to establish a secondary meaning is that the ordinary buyer associates the mark with a single source, even if that source is anonymous. Centaur Commc'ns, Ltd. v. A/S/M Commc'ns, Inc., 830 F.2d 1217, 1221 (2d Cir. 1987). Thus, the fact that the public is probably unaware of the existence of the limited liability corporation registered as New York City Triathlon LLC does not negate the Court's prior finding of secondary meaning.
Moreover, that a product (in this case, the race known as the New York City Triathlon) has been known at times by similar but not identical names (namely, the "FORD New York City Triathlon," the "FORD New York City Triathlon presented by accenture," the "NAUTICA New York City Triathlon presented by Toyota," the "NAUTICA New York City Triathlon presented by RCN" (Korff Decl. Exs. B-F)) does not dilute the inference of its origin, especially where, as here, the race appears to be most often referred to simply as the "New York City Triathlon" (see Korff Decl. Exs. O-P (cataloging news coverage of the event)). Cf. Essie Cosmetics, Ltd. v. Dae Do Int'l., Ltd., 808 F. Supp. 952, 959 (E.D.N.Y. 1992) (private label sales did not negate secondary meaning in trade dress infringement action where product appeared largely under a single label); I.P. Lund Trading ApS v. Kohler Co., 11 F. Supp. 2d 112, 121 (D. Mass. 1998) (private label sales did not negate secondary meaning). Plaintiff has used and promoted its marks exclusively for the past decade. Its considerable evidence — not just of the expenditure of substantial sums, but of press and public recognition of its race as the "New York City Triathlon" and Korff's association therewith — demonstrates that its efforts and expenditures have promoted the marks as identifiers of its product (the race). (See, e.g., Korff Decl. Exs. O-P.)
Likewise, the fact that Plaintiff has co-existed with an entity known as New York Triathlon Club does not, in and of itself, obviate its acquisition of secondary meaning for its marks. `The owner of a mark is not required to police every conceivably related use thereby needlessly reducing non-competing commercial activity and encouraging litigation in order to protect a definable area of primary importance.'24 Hour Fitness USA, Inc. v. 24/7 Tribeca Fitness, LLC, 447 F. Supp. 2d 266, 272 (S.D.N.Y. 2006) (quoting Playboy Enters., Inc. v. Chuckleberry Publ'g, Inc., 486 F. Supp. 414, 422-23 (S.D.N.Y. 1980)). Thus, in Playboy Enterprises, Inc. v. Chuckleberry Publishing, Inc., a court found that plaintiff Playboy magazine was entitled to litigate against "Playmen" magazine even though the company had failed to litigate against "Players" or "Playguy," two other magazines with related names. Id. at 422-23.
In this case, New York City Triathlon LLC has not commenced any litigation against an entity called the New York Triathlon Club ("NYTC"), a triathlon race organizing corporation founded in 1984 and based approximately 100 miles north of New York City, in Saugerties, New York. (See Decl. of D. Honig, Mar. 25, 2010 ("Honig Decl.") ¶ 1; Pl.'s Br. at 7.) Plaintiff explains that it is not concerned about confusion between its organization and NYTC because NYTC does not compete with New York City Triathlon LLC. Aside from one NYTC race that takes place in New York City's Central Park, NYTC operates in a fundamentally different market (upstate New York as opposed to New York City). (Pl.'s Br. at 7; Honig Decl. ¶ 2.) Second, New York Triathlon Club's races are not "extensively promoted or advertised," as Plaintiff's race is. (Id.) Third, the names of the organizations have significantly different meanings (i.e., New York Triathlon Club versus New York City Triathlon LLC), because most, if not all, consumers interpret the name "New York Triathlon Club" to be New York State Triathlon Club. (Id.)
The Court questions whether consumers will always or predominantly infer that an organization using the prefix "New York" (absent "City") necessarily refers to a statewide group. New York City is, after all, often referred to as "New York," as evidenced, for example, by any of the dozens of pop songs entitled "New York, New York" that are about New York City.
However, in this case, NYTC's mark is a "word-design" mark (a mark coupled with an image or picture), and as such, the club's name appears in an arc above a large yellow graphic of New York State, which forms the core of the mark. (See Decl. of C. Vandaele, Mar. 23, 2010 ("Vandaele Decl."), Ex. 9 (screen shot of NYTC website).) Given the fact that the state logo is the central component of the NYTC mark, the Court agrees with Plaintiff that NYTC and New York City Triathlon LLC are readily distinguishable entities; they have distinctive marks with features plainly indicating that the two groups operate almost (at least primarily) in different markets, and so are not likely to be confused.
Additionally, while third party use of similar marks can sometimes "dilute the strength of a mark," the mere existence of a single related mark is insufficient to negate a finding of secondary meaning, absent evidence that the similar mark (in this case, NYTC's mark) is well-promoted or recognized by consumers.See Nabisco v. Warner-Lambert Co., 32 F. Supp. 2d 690, 698-99 (S.D.N.Y. 1999); Trs. of Columbia Univ. v. Columbia/HCA Healthcare Corp., 964 F. Supp. 733, 744-45 (S.D.N.Y. 1997); see also Lexington Mgmt. Corp. v. Lexington Capital Partners, 10 F. Supp. 2d 271, 281-82 (S.D.N.Y. 1998) (fact that 125 businesses incorporated the word "Lexington" was of little probative value absent evidence that the other marks were "well-promoted or recognized by consumers"). Since no one contends that NYTC's mark is well-promoted or easily recognized by consumers, and no evidence has been presented to this Court indicating that NYTC advertises or promotes of its mark extensively, the Court does not find that the existence of the Saugerties-based New York Triathlon Club dilutes Plaintiff's Marks or in any way undermines the Court's previous finding that Plaintiff's Marks have obtained secondary meaning.
B. Likelihood of Confusion
Since Plaintiff's Marks are protectable, the question is only whether there is a likelihood of confusion between the NYC TRIATHLON Marks and Defendant's Club Marks. The Second Circuit has articulated eight factors, known as the "Polaroid" factors, to be considered when assessing the likelihood of consumer confusion:
(1) the strength of the plaintiff's mark;
(2) the similarity of the plaintiff's and defendant's marks;
(3) the competitive proximity of the products or services;
(4) the likelihood that the plaintiff will "bridge the gap" and offer a product or service similar to the defendant's;
(5) actual confusion between the products or services;
(6) good faith on the defendant's part;
(7) the quality of the defendant's products or services; and
(8) the sophistication of buyers.Polaroid Corp. v. Polarad Elecs. Corp., 287 F.2d 492, 495 (2d Cir.), cert. denied, 368 U.S. 820 (1961). In weighing these factors, the Circuit has counseled that "no single Polaroid factor is determinative." Plus Prods. v. Plus Discount Foods, Inc., 722 F.2d 999, 1004 (2d Cir. 1983).
(1) (2) Strength and Similarity of Marks
As discussed above, a mark's strength may be measured in two very different ways: (1) inherent strength, resulting from the mark's degree of inherent distinctiveness, usually measured on the ladder ranging from unprotectable generic marks to arbitrary, fanciful marks that enjoy the broadest protection, see Abercrombie Fitch, 537 F.2d at 9-11; and (2) acquired strength, reflecting the degree of consumer recognition the mark has achieved. Because the policies of trademark law have historically disfavored a grant of exclusive rights to marks that are descriptive, see id. at 10, the Lanham Act's compromise allowed descriptive marks registration and a minimal scope of protection, which is contingent on establishing that the mark had acquired a secondary meaning as a designator of source. TCPIP Holding Co. v. Haar Commc'ns, Inc., 244 F.3d 88, 100 (2d Cir. 2001).
Defendant argues that, because Plaintiff's mark is descriptive — even though it has acquired secondary meaning — it is entitled only to a negligible amount of protection and therefore Defendant should be allowed to call itself "New York City Triathlon Club" for any one of three reasons. (Def.'s Br. at 15-16.)
First, Defendant argues that its use of graphics (an orange stylized headshot of the Statute of Liberty superimposed on a blue background shaped like the New York Cityscape onto which the words "New York City Triathlon Club" are grafted) wholly distinguishes the two sets of marks, since Plaintiff's is only a word mark. (Def.'s Br. at 15-16.) The Court disagrees. While conflicting marks are to be compared by looking at them as a whole, rather than breaking the marks into their component parts for comparison, Estate of P.D. Beckwith, Inc. v. Comm'r of Patents, 252 U.S. 538, 545-46 (1920), it is appropriate in determining the question of likelihood of confusion to give greater weight to the important or "dominant" parts of a composite mark, Kangol Ltd. v. KangaROOS U.S.A., Inc., 974 F.2d 161, 163 (Fed. Cir. 1992). Where a mark contains both a design and a word, the word is generally considered to be dominant and is therefore accorded greater weight. Herbko Int'l, Inc. v. Kappa Books, Inc., 308 F.3d 1156, 1165 (Fed. Cir. 2002); In re 1st USA Realty Prof'ls, Inc., 84 U.S.P.Q.2d 1581, 1586 (T.T.A.B. 2007). This is especially true where the design or image "merely augments the message conveyed by the word." Worthington Foods, Inc. v. Kellogg Co., 732 F. Supp. 1417, 1440 (S.D. Ohio 1990) (word considered dominant in a composite mark consisting of a heart-shaped design and the word, "HEARTWISE"); accord In re Strathmore Prods., Inc., 171 U.S.P.Q. 766, 767-68 (T.T.A.B. 1971) (GLISTEN and tear drop design was confusingly similar to GLISS'N word mark because of phonetic and meaning identity between the two words). In assessing which features of a mark are dominant, while words and their pictorial representations should not be "equated as a matter of law," a fact finder may equate them as a "factual matter." Mobil Oil Corp. v. Pegasus Petroleum Corp., 818 F.2d 254, 257 (2d Cir. 1987) (noting that the district court equated the word mark PEGASUS with Mobil Oil's "flying horse" design mark).
In this case, the word components of the two sets of marks are plainly dominant, and Defendant's graphics are insufficient to distinguish them. The Statute of Liberty is well-known synecdoche for New York City, and the cityscape is nothing but a geographical referent; therefore, Defendant's use of these images does no more than emphasize the geographical affiliation of the mark. In light of this fact — that "New York City Triathlon" is the salient feature in both marks — the Court cannot say that Defendant's mark is not confusingly similar to Plaintiff's mark, even though the marks do appear to the eye to be different. Defendant's use of graphics is insufficient to give consumers a distinct overall impression; the mental impact of the two marks outweighs any visual difference between them. See Am. Home Prods. Corp. v. Johnson Chemical Co., 589 F.2d 103, 107 (2d Cir. 1978).
Second, Defendant argues that Plaintiff's frequent use of logos or house marks alongside its NYC TRIATHLON Marks makes it unlikely that there will be any confusion between Plaintiffs and Defendant's marks. That is, Plaintiff's word mark often appears in between two corporate sponsors' marks: Nautica's in thin blue lettering, above bold, bright yellow-gold text that reads, "New York City Triathlon," which is followed by very small blue text that states: "presented by RCN" (where RCN is represented by a house mark, the letters RCN followed by a star). Defendant proffers that use of these marks, a customary practice in the industry, renders Plaintiff's Mark completely different from the Club Marks.
While the Second Circuit has sometimes held that "the presence of a distinct brand name may weigh against a finding of confusing similarity," the Circuit has often found that the "addition of a trade name does not necessarily alleviate the problem of confusion of marks, and indeed, can aggravate it, as a purchaser could well think plaintiff had licensed defendant as a second user." Playtex Prods., Inc. v. Georgia-Pacific Corp., 73 U.S.P.Q.2d 1127, 1132 (2d Cir. 2004) (citing cases, internal quotations omitted). For example, in A.T. Cross Co. v. Jonathan Bradley Pens, Inc., 470 F.2d 689, 692 (2d Cir. 1972), the Second Circuit explained that the addition of the junior user's trade name, "by Bradley," would not dispel confusion between "La Crosse" (or "LaCrosse") and plaintiff's "Cross" mark, where both companies marketed and sold pens.
In this case, the corporate logos are not the dominant component of Plaintiff's Marks and therefore do not help to distinguish the Club Marks from Plaintiff's. "New York City Triathlon" appears in bold yellow-gold lettering, while the house marks frame the central event in subtle blue text around its edges. Likewise, the absence of a corporate logo on the Club Marks does nothing to dispel any potential confusion between the two sets of marks, because, just as in A.T. Cross, it is likely that consumers will infer that the marks are related — Plaintiff and Defendant are in the same business, have marks that sound nearly identical, that use similar color schemes (blue-orange and blue-gold), and the dominant portions of the two sets of marks overlap.
Moreover, the house marks associated with Plaintiff's race are not really relevant to the inquiry before the Court, since the basis of the complaint in this case is limited to the use of the NYC TRIATHLON word Marks. As with challenges to trademark registration before the PTO, the use of a house mark in conjunction with a product mark does not serve to prevent a finding of likelihood of confusion when the house mark is not included in the mark for which registration is sought (or in this case, the marks on which the demand for injunctive relief is based). See In re Microsoft Corp., 68 U.S.P.Q.2d 1195, 1199 (T.T.A.B. 2003). In Microsoft, the relevant inquiry was therefore limited to whether Microsoft's applied-for mark "OFFICE.NET" was confusingly similar to the previously registered mark "OFFICENET", even though Microsoft represented that it intended to use its house mark ("MICROSOFT") in connection with any use of OFFICE.NET. Id. Microsoft is instructive here. Plaintiff has applied for registration of NEW YORK CITY TRIATHLON, NYC TRIATHLON, and NYC TRI. None of these marks bears the trade name of the race's corporate sponsors, even though Plaintiff sometimes refers to its race using the house mark of its corporate sponsor (e.g., NAUTICA or FORD). Because the applied-for marks — and indeed, the marks in the complaint at issue in this case — do not incorporate a house mark, the relevant inquiry is limited to whether Defendant's use of its Club Marks is confusingly similar to one or more of Plaintiff's applied-for marks (the NYC TRIATHLON Marks), without reference to any concomitant corporate logo. And for the reasons already stated, the Court finds that "New York City Triathlon" and "New York City Triathlon Club" are confusingly similar.
Third, Defendant argues that the "slight difference" of adding the suffix "Club" to "New York City Triathlon" is sufficient to dispel confusion between Plaintiff's and Defendant's marks. But "Club" is a generic term, and generic terms are given less weight in analyzing the likelihood of confusion between marks "on the rationale that the public will look to other portions of the marks and will not be confused unless the other portions are similar." 2 McCarthy on Trademarks and Unfair Competition 23:15(F) (supp. 1990 at 44). This Court recognizes that, more often than not, analysis of the use of generic terms in this context has been limited to cases where two marks share a generic term, see, e.g., Am. Cyanamid Corp. v. Connaught Labs., Inc., 800 F.2d 306 (2d Cir. 1986) (HIBIMUNE and HibVax, where "hib" was the generic term), whereas the facts of this case involve only a junior user's appropriation of a generic term. However, this distinction does not undermine the basic logic that courts ought to disregard generic components of marks because the public can be said to rely more on the non-generic portion of a given mark.See In re Nat'l Data Corp., 753 F.2d 1056, 1058-60 (Fed. Cir. 1985). Indeed, in a case that similar to the one at bar, Judge Brody of the Eastern District of Pennsylvania applied precisely this principle, holding that the mere addition of the word "club" to Villanova University's mark "Wildcats" was insufficient to distinguish the defendant ("Wildcat Club") from the university and its sponsored entities. Villanova Univ. v. Villanova Alumni Educ. Found., Inc., 123 F. Supp. 2d 293, 305 (E.D. Pa. 2000).
Accordingly, I conclude that the first two factors of thePolaroid test favor Plaintiff and do not support vacating the injunction. Although Plaintiff's NYC TRIATHLON Marks are entitled to limited protection under the Lanham Act, the Club Marks are strikingly similar to Plaintiff's Marks and any differences between them are insufficient to ward off consumer confusion.
(3) Similarity of Services
To be "related" for the purposes of trademark law, conflicting goods or services do not have to be in direct competition with one another. Rather, the relevant question is whether they are so "related" that a reasonable buyer is likely to think that a defendant's goods or services are somehow connected with or sponsored by the plaintiff, due to similar marks. Herbko Int'l, Inc. v. Kappa Books, Inc., 308 F.3d 1156 (Fed. Cir. 2002) ("Even if the goods and services are not identical or specifically related in kind, they may be sufficiently related in the mind of the consuming public to cause confusion concerning the source or origin of the goods and services.").
Put otherwise, goods are "related" if customers are likely to think that the infringer's goods come from the same source as the senior user's goods or are sponsored by, affiliated with or connected with the senior user. In re Save Venice New York, Inc., 259 F.3d 1346, 1355 (Fed. Cir. 2001). For example, in Giant Food, Inc. v. Nation's Foodservice, Inc., 710 F.2d 1565 (Fed. Cir. 1983), the Federal Circuit held that fast-food hamburgers marketed under the "GIANT" mark were sufficiently related as to cause confusion with the "GIANT FOOD" mark used by supermarkets. Specifically, the court explained, "While we recognize that the average consumer makes a distinction between fast-food restaurants and supermarkets, we are satisfied that, if the marks themselves are confusingly similar, customers of the fast food restaurant would be likely to believe that [the supermarket] owned, sponsored, or supplied that business." Id. at 1570.
Likelihood of confusion has also been found in cases involving "complementary" goods and services, even though some of these pairs of goods occupy fairly distinct market spaces insofar as the purchase of one does not necessarily implicate the other.See, e.g., Fisons Horticulture, Inc. v. Vigoto Indus., Inc., 30 F.3d 466 (3d Cir. 1994) (peat moss and fertilizer); E J Gallo Winery v. Gallo Cattle Co., 967 F.2d 1280 (9th Cir. 1992) (wine and cheese); Octocom Sys., Inc. v. Houston Computer Servs., Inc., 918 F.2d 937 (Fed. Cir. 1990) (computer programs and modems); In re Martin's Famous Pastry Shoppe, Inc., 748 F.2d 1565 (Fed. Cir. 1984) (bread and cheese); Aunt Jemima Mills Co. v. Rigney Co., 247 F. 407 (2d Cir. 1917) (pancake batter and syrup).
Defendant argues that, even if its marks are similar to Plaintiff's, there is insufficient similarity between the services it offers to its members (seminars and training for triathlons and social events) and the triathlon itself, which is the product offered by Plaintiff; therefore, this factor ought to weigh in Defendant's favor. There are several flaws in this argument. One is that Plaintiff has provided evidence that it, like Defendant, also offers training services, albeit through a partnership with a local sports club (Reebok Sports Club/NY). (Korff Decl. ¶ 36 Ex. T). As part of Reebok's exclusive sponsorship deal, it offers triathlon-specific courses, including a "Triathlon Club," a six-month training program. Members of the Reebok Sports Club are given priority registration for the New York City Triathlon. (Id. Ex. T.) Thus, some of the services offered by Plaintiff and Defendant are in fact similar.
Defendant urges this Court to draw a contrary conclusion based on its representation that it currently has no intention of "organizing" any triathlon but instead intends to dedicate itself solely to offering supporting services to triathletes (e.g., seminars, training for triathlons, social events). Specifically, Defendant urges this Court to conclude that, in the absence of intent to organize a race, Defendant's services cannot be considered similar to those offered by New York City Triathlon LLC (i.e., the New York City Triathlon). (See Vandaele Decl. ¶ 4; Def.'s Br. at 16-17.) Mr. Vandaele says that, in his experience, training clubs "do not also sponsor" races, and therefore, training clubs and races are inherently dissimilar and consumers would not be confused by two similarly-named entities. (Vandaele Decl. ¶ 17.) Defendant also provides affidavits from three different triathlon organizing entities in other cities, each of which attests that the race in its jurisdiction is unrelated to the club, even though the two entities share a similar name. (See id. Exs. 5-7.)
The Court does not find Defendant's arguments persuasive.
First, Mr. Vandaele appears to have forgotten that New York City's most famous road race, the New York City Marathon, is organized and operated by a training club (the New York City Road Runners). Consumers in this jurisdiction might well expect a club that shares a name with a race to be affiliated with the race of the same name — or at least interpret club training services to be similar or otherwise related to the race itself. Additionally, one regional organization refers to itself as a "club" (the aforementioned New York Triathlon Club) but organizes multi-sport events — a fact of which Mr. Vandaele must be aware, since, as discussed below, he organizes a triathlon at Lake Sebago that takes place the day before a racing event that is organized by NYTC. (Honig Decl. ¶ 5.) Therefore, the fact that Defendant calls itself a "club" does not necessarily distinguish the services offered by the parties.
Second, in addition, whatever else might be true of Mr. Vandaele's experience with the relationship between races and training clubs, the fact remains that he has (through his retail store, SBR Multisports, Inc. ("SBR")) helped to organize or sponsor more than a dozen triathlons over the past five years, including the Plaintiff's race. (Honig Decl. ¶ 5 (Vandaele/SBR has organized triathlons at Lake Sebago in Harriman State Park during June and August for approximately three years); Vandaele Decl. ¶ 16 (SBR sponsored the New York City Triathlon for the years 2004-2008); Korff Decl. ¶ 31 (SBR sponsored the NYC Triathlon Club Championships from 2005-2008); Jakes Decl. ¶ 2 Ex. B (Vandaele was "staging and publicizing" a race known as the "Iron Race NYC `The Underground'").)
Mr. Vandaele has been intimately involved in the New York City Triathlon and other events organized by New York City Triathlon LLC. Between 2005 and 2008, SBR actually sponsored the New York City Triathlon, and in exchange "was permitted to call itself the `exclusive triathlon and bike retailer'" of the triathlon. (Korff Decl. ¶ 45.) During those same years, Mr. Vandaele (through SBR) also sponsored a race among members of the various triathlon clubs, which was organized by Plaintiff and was known as the "NYC Triathlon Club Championships." (Id. ¶ 31.) Thus, Mr. Vandaele is an active race organizer. Given his significant and ongoing relationships with various triathlons, what Mr. Vandaele has not told the Court about his past relationship with Plaintiff and with race organizing makes him, to my mind, a less than credible witness.
This factor weighs in favor of Plaintiff.
(4) Bridging the Gap
"The term `bridging the gap' is used to describe the senior user's interest in preserving avenues of expansion and entering into related fields." C.L.A.S.S. Promotions, Inc. v. D.S. Magazines, Inc., 753 F.2d 14, 18 (2d Cir. 1985). One court in this District has explained "bridging the gap" in the following way: "In the likelihood of confusion context, `bridging the gap' refers to two distinct possibilities. The first is that the senior user presently intends to expand his sales efforts to compete directly with the junior user. . . . The second possibility is that, while there is no present intention to bridge the gap, consumers will assume otherwise and conclude, in this era of corporate diversification, that the parties are related companies." Lambda Elecs. Corp. v. Lambda Tech., Inc., 515 F. Supp. 915, 926 (S.D.N.Y. 1981).
As explained above, New York City Triathlon LLC has undertaken to offer training services through its affiliation with Reebok Sports Club. Therefore, there is no gap to bridge in this case — both Plaintiff and Defendant are offering some of the same services. This factor favors Plaintiff.
(5) Actual Confusion
The "actual confusion" factor inquires whether there is evidence of "consumer confusion that enables a seller to pass off his goods as the goods of another." Sports Authority, Inc. v. Prime Hospitality Corp., 89 F.3d 955, 963 (2d Cir. 1996) (internal quotations and citation omitted).
Here, Defendant existed under the name "New York City Triathlon Club" for less than two months before New York City Triathlon LLC brought suit to enjoin the use of the junior mark. Plaintiff sent NYC Triathlon Club a cease and desist letter demanding that it discontinue use of the name on January 8, 2010, one week after the club renamed itself (effective January 1, 2010), and filed suit on February 22, 2010, to enforce its rights. See New York City Triathlon, 2010 WL 808885, at *2.
During the period when Plaintiff's and Defendant's Marks co-existed, there was one instance of actual confusion between the two. Richard Izzo, head of the Westchester Triathlon Club and organizer of the Westchester Toughman Half Iron Triathlon, testified that he received an email on December 23, 2009, from the NYC Triathlon Club announcing the prospective launch of the club. (Decl. of R. Izzo, Mar. 25, 2010 ("Izzo Decl.") ¶ 2 Ex. B.) In response, he stated that he emailed John Korff as a representative of the New York City Triathlon to "ask him if he could add the Westchester Toughman Half Iron Triathlon" to "what I believed was his club's schedule." (Id. ¶ 3.) Mr. Izzo says that he was subsequently informed that the NYC Triathlon Club and NYC Triathlon were not affiliated. (Id. ¶ 4.)
While courts in this jurisdiction have held that a single instance of actual confusion is insufficient to find for the plaintiff under the "actual confusion" factor of the Polaroid test, Nora Beverages, Inc. v. Perrier Group of Am., Inc., 269 F.3d 114, 124 (2d Cir. 2001), the test of infringement is the likelihood of confusion, not proof of actual confusion. A plaintiff need not prove any instances of actual confusion.Centaur Commc'ns, Ltd. v. A/S/M Commc'ns. Inc., 830 F.2d 1217, 1227 (2d Cir. 1987). And as the Court explained in Centaur, where the parties were both in the market for only a short time — in that case, four months — the lack of instances of actual confusion "is not especially significant." Id. at 1227.
In light of the fact that Plaintiff and Defendant's marks have co-existed for less than two months, and there has already been an instance of confusion, the Court concludes that the "actual confusion" factor favors neither party. I also give the "actual confusion" factor minimal weight.
(6) Good Faith
In determining a defendant's intent, "actual or constructive knowledge" of the prior user's mark or dress may indicate an absence of good faith or bad faith. Mobil Oil Corp. v. Pegasus Petroleum Corp., 818 F.2d 254, 259 (2d Cir. 1987). In particular, where such prior knowledge is accompanied by similarities so strong that it seems plain that deliberate copying has occurred, the Second Circuit has upheld a finding of bad faith. Id. at 258-59. Put otherwise, where a junior user intentionally copies a mark, a presumption of bad faith arises. Paddington Corp. v. Attiki Imps. Distribs., Inc., 996 F.2d 577, 586 (2d Cir. 1993). However, this presumption may be overcome by evidence that a defendant conducted a trademark search before using the mark, or that a defendant sought and relied on the advice of counsel — the mere fact that a defendant was aware of a plaintiff's mark is not necessarily inconsistent with a defendant's good faith. See id.
In this case, the presumption of bad faith is not overcome by so much as a scintilla of evidence. Mr. Vandaele concedes that he was aware of the New York City Triathlon and its mark as early as 2004, approximately six years before he adopted the Club Marks. (Vandaele Decl. ¶¶ 16, 22.) For at least four of those years, Mr. Vandaele's sporting goods store sponsored the New York City Triathlon race and was its "exclusive triathlon and bike retailer." (Korff Decl. ¶ 45.) Between 2005 and 2008, Mr. Vandaele's store also co-sponsored another race organized by Plaintiff, known as the "New York City Triathlon Club Championships." (Id. ¶ 31.) That name that is surprisingly similar to Defendant's chosen moniker given that Defendant purports not to have selected its name based on its proximity to Plaintiff's intellectual property.
One wonders when and how the relationship between Plaintiff and Mr. Vandaele and his store ended and whether changing the name of SBR's triathlon club is somehow related to that untold story.
Further, on at least one occasion prior to renaming his triathlon club, Mr. Vandaele (through SBR) appears to have attempted to capitalize on the New York City Triathlon name by printing unauthorized and unlicensed "NYC Triathlon Finisher" t-shirts, which he was ultimately compelled to destroy when Plaintiff objected to the distribution of shirts bearing one of its marks. (Def.'s Br. at 20 (citing Vandaele Decl. ¶ 22).)
Mr. Vandaele attempts to rebut the presumption of bad faith by providing several reasons why he might have renamed SBR Triathlon Club the "New York City Triathlon Club" that have nothing to do with any attempt to trade off of Plaintiff's goodwill. These include that all of the club members are from New York City (Vandaele Decl. ¶ 17), that the club is based in New York City (id.), and that he needed to spin off the club from his retail operation so that he could sell the store without having to book the negative cash flows recorded by the club (id.). The Court rejects these reasons as pretextual.
I must assume, on this motion for a preliminary injunction, that Mr. Vandaele is correct in his conclusion that SBR will be more attractive to potential buyers if any debts incurred by the affiliated triathlon club are removed from its books. (Id. ¶ 7.) But this has absolutely nothing to do whatsoever with the specific name Mr. Vandaele applied to his new club. Even taking at face value his desire to inform local triathletes of the location and purpose of the club (id. ¶ 12), there were a plethora of other names available to him that were not virtual replicas of Plaintiff's Marks. For example, he could have named the club the "Gotham" Triathlon Club, since "Gotham" (outside the context of Batman) is a name that is associated with only one place — New York City. The same could be said of "Big Apple Triathlon Club" or "Five Borough Triathlon Club" or maybe even "Manhattan Triathlon Club." However, I cannot and do not credit Mr. Vandaele's testimony about the reasons why he changed the name of his club. "SBR Triathlon Club" conveyed to potential members both the exact location of the club (Vandaele's store, which is where it began) and some approximation of its purpose (although if the purpose of the club is to help athletes train for triathlons, then one might expect to see the word "training" in the club's name). Mr. Vandaele has not testified that he conducted a trademark search to determine whether New York City Triathlon was a protected mark, nor did he testify that he consulted a lawyer for advice on whether "New York City Triathlon Club" might infringe upon one or more of Plaintiff's Marks. The Court finds it implausible that he chose Plaintiff's name for any reason other than to capitalize on the reputation of plaintiff's race.
In light of his failure to provide a creditable explanation for why he chose the "New York City Triathlon Club" mark, the Court finds that he has failed to rebut the presumption of bad faith arising from his actual knowledge of Plaintiff, its goodwill, sponsorship arrangements and marks.
(7) Quality of Goods and Services
The "quality of goods and services" factor "generally considers whether the senior user's reputation could be tarnished by inferior merchandise [or services] of the junior user." Cadbury Beverages, Inc. v. Cott Corp., 73 F.3d 474, 483 (2d Cir. 1996) (internal quotations omitted). However, the comparative difference in the quality of the products offered by a plaintiff and defendant is one of the less probative factors in a determination of the likelihood of confusion. Virgin Enters. Ltd. v. Nawab, 335 F.3d 141, 151 (2d Cir. 2003). As the Second Circuit has explained, differing quality really goes more to the harm that confusion can cause than it does to the likelihood of confusion itself. Id. at 152.
Here, Plaintiff has presented evidence that Mr. Vandaele's products and services (as offered through his store, SBR) may be of questionable quality. That is, Plaintiff has recounted one instance where Mr. Vandaele attempted to distribute unauthorized NYC Triathlon t-shirts (Korff Decl. ¶ 46), another instance where he offered products for a charity raffle that the winner subsequently had difficulty collecting from SBR (id. ¶ 47), and yet another instance where Mr. Vandaele attempted to organize an "Iron Race" that may have infringed on the IRONMAN popular trademark (id. ¶ 53). By contrast, Mr. Vandaele has testified that he runs "one of the leading triathlon retailers in the country, if not the world," as evidenced by the many accolades SBR has received from industry publications and local media. (Vandaele Decl. ¶ 19.)
The problem with the testimony from both parties is that it does not provide any information about the quality of the services provided by Mr. Vandaele's triathlon club. This factor of the Polaroid analysis addresses the quality of goods and services provided by junior user — not any loosely related entities. Mr. Vandaele's "New York City Triathlon Club" operated as such for only a brief period of time, between January and March 2010, and the Court does not even know whether the club organized any training events during that period. So this factor is at most neutral, and in any event, not helpful to the analysis. See De Beers LV Trademark Ltd. v. DeBeers Diamond Syndicate Inc., 440 F. Supp. 2d 249, 279 (S.D.N.Y. 2006) (single product sale provided insufficient basis for court to assess quality of goods and factor was therefore neutral).
(8) Sophistication of Consumers
The last Polaroid factor — the inquiry into consumer sophistication — "considers the general impression of the ordinary purchaser, buying under the normally prevalent conditions of the market and giving the attention such purchasers usually give in buying that class of goods." Star Indus., Inc. v. Bacardi Co., 412 F.3d 373, 390 (2d Cir. 2005) (internal quotations and citation omitted).
Consumers in this case range from elite professionals to amateurs looking to compete in their first triathlon. The record reflects that a majority of registrants for the 2010 NYC Triathlon have identified themselves as first time triathletes. (Korff Decl. ¶ 11 (56% of registrants are first time triathletes).) These consumers are properly considered unsophisticated buyers, for whom confusion is especially likely.See Guinness United Distillers Vintners B.V. v. Anheuser-Busch, Inc., No. 02 Civ. 0861, 2002 WL 1543817, at *6 (S.D.N.Y. July 12, 2002) ("unsophisticated buyers increase the likelihood of confusion").
Moreover, in this case, one highly sophisticated consumer, Richard Izzo, head of the Westchester Triathlon Club and organizer of the Westchester Toughman Iron Triathlon, was confused about the relationship between the NYC Triathlon and the NYC Triathlon Club. (Izzo Decl. ¶¶ 3-4.) Given his familiarity with the triathlon business, Mr. Izzo's confusion suggests that a range of consumers would be confused by the similarities between Plaintiff's and Defendant's marks. Accordingly, this factor weighs in favor of Plaintiff.
C. Weighing the Polaroid Factors
Having entered findings as to each Polaroid factor, the Court must determine what weight to give to each. The Second Circuit has counseled that "no single Polaroid factor is determinative,"Plus Prods. v. Plus Discount Foods, Inc., 722 F.2d 999, 1004 (2d Cir. 1983), but the first three factors are "perhaps the most significant," Mobil Oil Corp. v. Pegasus Petroleum Corp., 818 F.2d 254, 258 (2d Cir. 1987). Those are: strength, similarity of the marks and closeness of the goods or services. Additionally, the absence of certain factors (alone or in combination), including instances of actual confusion and evidence that an infringer's goods are of inferior quality, does not automatically mean there is no likelihood of confusion. Id. at 259-60 (absence of intent to "bridge the gap" and quality of infringer's goods);Centaur Commc'ns, Ltd. v. A/S/M Commc'ns, Inc., 830 F.2d 1217, 1227 (2d Cir. 1987) (absence of actual confusion). Finally, the list of Polaroid factors does not exhaust the possibilities — the Court is still at liberty to take additional variables into account. Physicians Formula Cosmetics, Inc. v. West Cabot Cosmetics, Inc., 857 F.2d 80, 85 (2d Cir. 1988) (citation omitted).
As explained above, the Court finds that the first three factors of the Polaroid test favor Plaintiff. Although Plaintiff's mark is descriptive and is therefore entitled to limited protection under the Lanham Act, it is nevertheless entitled to some protection. And given the similarity of the marks and the closeness of the goods and services offered by Plaintiff and Defendant, the Court concludes that these three factors weigh strongly in favor of a finding of likely confusion between the marks. Further, as to the fourth factor, there can be no question about Defendant's intent to bridge the gap, since both Plaintiff and Defendant offer overlapping services (triathlon training). And both the bad faith and sophistication of consumers factors weigh overwhelmingly in favor of Plaintiff.
While the Court is aware of only a single instance of confusion between Plaintiff's and Defendant's marks, the paucity of evidence of actual confusion is offset by the fact that the two marks co-existed only for a short period — just two months. Therefore, I accord little weight to actual confusion as aPolaroid factor. Similarly, as explained above, the comparative quality of services factor is not helpful in determining the likelihood of confusion between the marks because the Court has insufficient data to make a determination on this point.
Accordingly, the Court finds that the Polaroid factors compel a finding of a likelihood of confusion between Plaintiff's and Defendant's marks.
Because the Court finds that Plaintiff is likely to succeed on the merits of its Lanham Act infringement claim, the Court does not revisit its previous analysis of Plaintiff's likelihood of success on its other claims under the Trademark Dilution Revision Act of 2006, Anticybersquatting Consumer Protection Act or New York State law. See March 9, 2010 Decision and Order.
III. Irreparable Harm
Courts in this Circuit have often applied a presumption of irreparable harm upon a finding that a plaintiff was likely to succeed on the merits of his claim in a trademark infringement action. See, e.g., Zino Davidoff SA v. CVS Corp., 571 F.3d 238, 246-47 (2d Cir. 2009); Weight Watchers Int'l, Inc. v. Luigino's, Inc., 423 F.3d 137 (2d Cir. 2005); see also Syler v. Woodruff, 610 F. Supp. 2d 256, 262-63 (S.D.N.Y. 2009). However, the Second Circuit's recent decision in Salinger v. Colting, No. 09 Civ. 2878, 2010 WL 1729126 (S.D.N.Y. Apr. 30, 2010), calls into question the propriety of that presumption, insofar as theSalinger court held that the analogical presumption of irreparable harm in copyright infringement actions was inconsistent with the standard for injunctive relief pronounced in eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006). See Salinger, 2010 WL 1729126, at *5.
The Salinger court explained that its holding was limited to the copyright context, id. at *7 n. 7, but this Court can find no principled basis on which to distinguish copyright from trademark infringement actions. Accordingly, and without deciding whethereBay also alters the presumption of irreparable harm in the context of a trademark infringement action, this Court appliesSalinger's articulation of the standard for injunctive relief. Since the showing required under Salinger is stronger than the pre-Salinger standard, because a plaintiff must make an independent showing of irreparable harm, a plaintiff who discharges his burden under Salinger does so under any standard.
Plaintiff in this case has presented the Court with sufficient evidence to support an independent finding of irreparable harm. Plaintiff has invested substantial effort into making the NYC Triathlon financially successful and well-known as a premiere international racing event. (Korff Decl. ¶¶ 25, 38.) Plaintiff has amassed substantial goodwill and a very favorable reputation during its ten years of operation (id. ¶ 28), which will suffer if Defendant is allowed to continue using its Club Marks. Among other things, the Court finds it likely that consumers will believe (erroneously) that signing up for Defendant's club will offer them an advantage in signing up for the New York City Triathlon itself, as is the case with the relationship between the New York Road Runners Club and the New York City Marathon. (See Supplemental Decl. of J. Korff, Mar. 26, 2010, ¶ 3.) Plaintiff has also testified that the likelihood of confusion between the marks is likely to further undermine its goodwill by making it more difficult for Plaintiff to secure sponsors for the 2011 race (id.), and has suggested that it is likely to compromise its relationship with Reebok, since Reebok currently operates the only authorized club affiliated with the race (Korff Decl. ¶ 37). Prospective loss of this goodwill alone is sufficient to support a finding of irreparable harm. See Tom Doherty Assoc. v. Saban Entm't, Inc., 60 F.3d 27, 37-38 (2d Cir. 1995) (noting that "a loss of prospective goodwill can constitute irreparable harm").
Moreover, by misappropriating Plaintiff's marks, Defendant is not only trading on Plaintiff's earned goodwill but is also taking from Plaintiff the ability to control its reputation and the services offered under its name and mark. Irreparable harm "exists in a trademark case when the party seeking the injunction shows that it will lose control over the reputation of its trademark pending trial," because loss of control over one's reputation is neither "calculable nor precisely compensable."Power Test Petroleum Distribs., Inc. v. Calcu Gas, Inc., 754 F.2d 91, 95 (2d Cir. 1985). Here, Plaintiff has come forward with evidence indicating that it is operating in the same market space as Defendant through its affiliation with Reebok, through which it operates a training club. (Korff Decl. ¶ 36.) For obvious reasons, these two clubs could be easily confused. During the brief period that Plaintiff and Defendant co-existed, at least one consumer — a highly sophisticated consumer — actually did confuse Defendant's club with the New York City Triathlon. (Izzo Decl. ¶ 4.) Further, Plaintiff has submitted a declaration from the organizer of the Los Angeles Triathlon, who testified that his organization has co-existed alongside the Los Angeles Triathlon Club, which has led to significant confusion by vendors and sponsors. (Caress Decl. ¶ 8.)
Defendant disputes none of these facts. Rather, Defendant claims that it will be irreparably harmed if it is not allowed to continue using the New York City Triathlon Club mark, as evidenced by the fact that some club members have sought refunds of dues since this Court first entered its preliminary injunction. (Vandaele Decl. ¶ 26-27.)
While harm to the Defendant is wholly irrelevant to the Court's analysis of potential irreparable harm facing the plaintiff in the absence of injunctive relief — the balance of hardships constituting a separate category of analysis, see Salinger, 2010 WL 1729126, at *9 — the Court also notes that Defendant has provided no explanation about the reason why people wanted their money back. I can speculate, however, that members might have joined the New York City Triathlon Club because they thought the club was affiliated with Plaintiff's race, and sought refunds when they realized (thanks to publicity about this lawsuit) that it was not. Were that the case, it would be strong evidence of actual consumer confusion, which supports this Court's findings of both likelihood of success on the merits and of irreparable harm.
IV. Balance of Hardships
The balance of hardships in this case clearly favors Plaintiff. As explained above, Plaintiff faces the threat of irreparable harm absent injunctive relief. Defendant alleges that it too will suffer irreparable harm if this Court's injunction is not vacated; however, none of the testimony it has presented to the Court warrants such a finding. Defendant only used the name "New York City Triathlon Club" for approximately two months, which is not enough time for Defendant to have established a reputation or significant presence in the relevant market. Defendant has submitted no evidence that the SBR Triathlon Club has been widely known under its new name in that brief period.
Defendant alleges that the balance of hardships tips in its favor because this is an especially crucial time of year for marketing, since east coast triathlon season is May-November, and therefore potential participants are looking to join a training club now. (Vandaele Decl. ¶¶ 26, 28.) If true, this fact weighs in Plaintiff's favor, not Defendant's, since Plaintiff is affiliated with a training club, whose reputation and business are likely to be undercut by Defendant's continued use of its nearly identical marks. This Court's injunction does not prohibit Defendant from operating a training club or recruiting members during this training season — only from doing so under marks that infringe upon Plaintiff's rights.
Defendant also alleges that the lawsuit has "caused our members and prospective members to become nervous about the viability of the NYC Triathlon Club," has caused at least one Board Member to resign because "she was particularly concerned that the Club did not have a name" (id. ¶ 27), and has allegedly created a generally "negative feeling about the Club" (id. ¶ 29). Defendant has presented the Court with neither the names of any of these members, prospective members or the concerned Board Member, nor with affidavits or other competent testimony from any of these individuals. Additionally, as noted above, this Court's injunction does not prohibit Defendant from operating a training club. It only prohibits Defendant from operating a training club using the name that infringes upon Plaintiff's Marks. For the reasons already stated, the fact that some members have sought refunds, without any additional information, does not provide the Court a sufficient basis to conclude that the Defendant is being harmed by a wrongfully-granted preliminary injunction, as opposed to because of its own misconduct, which has created confusion in the minds of potential members. Therefore, the Court finds that the balance of hardships tips decidedly for the Plaintiff.
V. The Public Interest
Having concluded that all other factors favor injunctive relief, the Court's sole remaining task is to confirm that granting injunctive relief would not disserve the public interest. See Salinger, 2010 WL 1729126, at *9. In this case, the public has an interest in not being deceived — in being assured that the mark it associates with a product is not attached to goods of unknown origin and quality. SK F, Co. v. Premo Pharm. Labs., Inc., 625 F.2d 1055, 1067 (3d Cir. 1980); accord Nat'l Rural Elec. Co-op Ass'n v. National Agr. Chemical Ass'n, 26 U.S.P.Q.2d (BNA) 1294, 1299 (D.D.C. 1992) (the public interest lies in avoiding confusion, particularly where defendant would be able to continue its activities under another mark). Accordingly, the public interest would not be disserved by this Court's injunction, and the Court finds that all factors favor injunctive relief.
VI. Posting of a Bond
VII. Modification of Injunction Terms
Doctor's Assocs., Inc. v. Stuart85 F.3d 975985 Id.
That request is denied. To permit Defendant to continue to use Plaintiffs mark to direct people to Defendant's new site is exactly what a preliminary injunction is designed to prevent: it would allow Defendant to continue to trade directly on Plaintiff's goodwill.
VIII. Defendant's Violations of the Injunction
Since this Court first entered a preliminary injunction in this case, Plaintiff has notified the Court of what it believes to comprise several violations of this Court's order. Each is detailed below.
First, Plaintiff has notified the Court that in response to the Court's preliminary injunction order and its direction at the hearing to "come up with a different name," (Hearing Tr., Mar. 9, 2010, at 7), Defendant has switched the order of its moniker from NYC Triathlon Club to "Triathlon Club NYC," continuing to use the same background graphic as before (the New York Cityscape plus a stylized orange headshot of the Statute of Liberty). In defense of its choice, Defendant argues that the "safe distance rule," which requires it to pick a new name that is a safe distance from Plaintiff's NYC TRIATHLON Marks, is not applicable to it because it has only been preliminarily enjoined. However, the Second Circuit has affirmed the application of the "safe distance" rule in the preliminary injunction context. See Oral-B Labs., Inc. v. Mi-Lor Corp., 810 F.2d 20, 24 (2d Cir. 1987), superseded on other grounds by Paddington Corp. v. Attiki Imps. Distribs., Inc., 996 F.2d 577, 585 (2d Cir. 1993).
"The test of consumer confusion is not whether the products can be differentiated when subjected to a side-by-side comparison, but rather whether they create the same general overall impression." RJR Foods, Inc. v. White Rock Corp., 603 F.2d 1058, 1060 (2d Cir. 1979). In this context, a reversal of syllables or words from another's mark can result in a mark that is still confusingly similar. See, e.g., Maternally Yours v. Your Maternity Shop, Inc., 234 F.2d 538 (2d Cir. 1956) (MATERNALLY YOURS confusingly similar to YOUR MATERNITY SHOP); Home Shopping Club, Inc. v. Charles of the Ritz Group, Inc., 820 F. Supp. 763 (S.D.N.Y. 1993) (ESSENCE OF TIME confusingly similar to TIMELESS ESSENCE); Bank of Am. Nat'l Trust and Say. Assoc. v. the Am. Nat'l Bank of St. Joseph, 201 U.S.P.Q. 842 (T.T.A.B. 1978) (AMERIBANC confusingly similar to BANK OF AMERICA); In re Nationwide Indus., Inc., 6 U.S.P.Q.2d 1882 (T.T.A.B. 1988) (RUST BUSTER confusingly similar to BUST RUST); Plus Prods. v. Physicians Formula Cosmetics, Inc., 198 U.S.P.Q. 111 (T.T.A.B. 1978) (PLUS FORMULA confusingly similar to FORMULA PLUS). That is exactly what has happened in this case. Defendant's selection of "Triathlon Club NYC" is not a sufficiently safe distance from Plaintiff's names and marks, especially in light of the fact that Defendant's new mark uses the same graphics as its old mark, and those graphics make the geographical portion of its mark ("NYC") a dominant feature. Thus, even if "Triathlon Club NYC" could, under some circumstances, be considered sufficiently different from "NYC Triathlon," the fact remains that the design portion of Defendant's new mark simply underscores the "NYC" reference, which the Court finds is likely to cause confusion with the Plaintiff's NYC TRIATHLON Marks, especially in light of the other similarities between the two organizations. Therefore, Defendant's new name violates the spirit and letter of the Court's March 9, 2010 Decision and Order, and Defendant is ordered to immediately refrain from using this name.
Second, Defendant is also ordered to immediately refrain from using infringing marks on its site and all other webpages within its control, such as, but not limited to, its Facebook, Twitter, and LinkedIn pages. Defendant informs the Court that it has declined to "totally deactivate," inter alia, its Twitter account, on the ground that it wishes to wait until the close of the litigation in this case before giving up its "nyctriclub" handle (username). (Vandaele Decl. ¶ 33.) Defendant's actions with respect to its Twitter account violate the express terms of this Court's order, which enjoined Defendant from using any and all of Plaintiff's marks. The fact that Defendant is not accepting additional "followers" on its "nyctriclub" Twitter account and has "protected" its "tweets" (rendered them private) (id.), does not alter the fact that Defendant's "nyctriclub" account is publicly viewable and patently in violation of the terms of the injunction. Defendant is ordered to remove any reference to "nyctriclub" or any of Plaintiff's Marks or anything similar from all websites, social networking sites and other forms of electronic media.
Third, Plaintiff notified the Court, on April 20, 2010, that Defendant had appeared at the Multisport World Conference and Expo under the name "New York City Triathlon Club" on April 18, 2010. (Decl. of V. Brumfield, Mar. 25, 2010 ("Brumfield Decl.") ¶¶ 3-4.) Defendant appeared both in the expo's program as "New York City Triathlon Club" and occupied a booth at the fair under a sign reading "New York City Triathlon Club." (Id. Exs. A-B.) This is also a violation of the injunction.
In response, Defendant states that it signed up for the event in February as "New York City Triathlon Club," before this Court issued its injunction prohibiting use of that name. (Decl. of L. Rekas, Apr. 20, 2010 ("Rekas Decl.") ¶ 3.) Defendant states that, in an attempt to ensure that the enjoined name would not appear at the expo, it sent an email to the event's organizers requesting that Defendant's name appear as "Triathlon Club NYC" on April 12, 2010, but by the time the organizers received its email the program had already been printed. (Id. ¶ 4.)
This excuse does not justify Defendant's failure to comply with the Court's order. Even though Defendant was aware that it had signed up for the event under a name it was subsequently enjoined from using, Defendant waited more than one month after this Court issued its injunction on March 9, 2010, before notifying the event's organizers of its name change. Defendant argumes that it should not be held liable for violating the terms of the injunction as a result of the sign that was displayed at its booth because it "did not prepare the sign and had no idea that a sign would even be provided," "the sign was small and located high above the booth," and "it would have been difficult to reach without a step stool or ladder." (Id. ¶ 6.) This is simply ludicrous. Defendant does not state or otherwise suggest that it made any attempt to have the sign removed, including among other infinitely reasonable possibilities, asking the event organizers to remove the sign (or to lend the club a step stool, which someone surely used to hang the sign in the first place). Moreover, Plaintiff states that several organizations attending the event managed to replace their event-issued signs with "bigger and/or more colorful logo-based signs" (Brumfield Decl. ¶ 4), which suggests that removal or obfuscation of the sign was within the purview of the New York City Triathlon Club. The club's failure to take any action to attempt to have the sign removed was in direct violation of this Court's order.
CONCLUSION
The Defendant's motion to vacate the preliminary injunction is denied. Plaintiff's motion to enjoin Defendant from any further violations of that injunction is granted. Defendant has until Friday, May 7, 2010, at 5pm EST to remedy any violations of the terms of this Court's injunction. If Defendant has not done so by that time, this Court will not hesitate to hold Defendant in contempt.
This constitutes the decision and order of this Court.
May 4, 2010