UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF INDIANA INDIANAPOLIS DIVISION
CMG WORLDWIDE, INC. and THE TOPPS COMPANY, INC. Plaintiffs, vs. THE UPPER DECK COMPANY, INC., Defendant.
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CASE NO. 1:08-cv-0761 RLY/JMS
PLAINTIFFS’ MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF EX PARTE APPLICATION FOR TEMPORARY RESTRAINING ORDER I. INTRODUCTION Plaintiffs, CMG WORLDWIDE, INC. (“CMG”) and THE TOPPS COMPANY, INC. (“TOPPS”, and together with CMG, “Plaintiffs”), seek a temporary restraining order (“TRO”) against defendant, THE UPPER DECK COMPANY, INC. (“Defendant”). Plaintiffs seek to enjoin Defendants, and its agents, distributors, representatives, assigns, and anyone acting in concert with them, from using the names, images, likenesses, signatures, personae, and other related indicia of deceased baseball legends Jackie Robinson (“Robinson”), Lou Gehrig (“Gehrig”), Mel Ott (“Ott”), Jimmie Foxx (“Foxx”), Rogers Hornsby (“Hornsby”), Thurman Munson (“Munson”), George Sisler (“Sisler”), and Johnny Mize (collectively, the “Legends”). Specifically, Defendant is on the verge of releasing its “2008 MLB SP Legendary Cuts” products, which make use of the Legends’ name, image, likeness and other elements (the “Legends’ Intellectual Property Rights”), which—as Defendant is aware—are exclusively licensed to TOPPS (“Defendant’s Cards”). Plaintiffs ask this Court to enjoin Defendant from releasing Defendants’ Cards and any other infringing products that use the Legends’ Intellectual Property Rights.
As explained in detail below and in the accompanying affidavits of Adam Zucker of TOPPS and Ryan M. Boyle of CMG, Defendant unsuccessfully sought to obtain the “Legends’ Intellectual Property Rights,” which were instead conveyed exclusively to TOPPS, defendant’s direct competitor. Having failed to acquire the Legends’ Intellectual Property Rights, Defendant’s
Defendants employed “self help” and simply used them, without permission.
knowing infringement is a blatant disregard and violation of the Legends’ Intellectual Property Rights and of TOPPS’ exclusive license to exploit them. Unless it is enjoined, Defendant will release the offending Defendant’s Card into the market on June 11th. If this happens, both TOPPS and CMG will sustain irreparable harm. As to CMG, it will appear that CMG has “double exclusively licensed” the Rights, has breached its exclusive agreements with TOPPS or does not actively monitor and protect its clients’ rights, all of which threatens to seriously diminish CMG’s standing and reputation as the premiere celebrity-licensing firm, which CMG has carefully and painstakingly cultivated over the last three decades. Similarly with TOPPS, by an April 14, 2008 press release, entitled “Multi-Year Deal Gives Topps Exclusive Rights to Produce Trading Cards of Major League Baseball’s Greatest,” TOPPS announced to the industry its exclusive rights for the use of the Legends. If
Defendant’s Cards enter the market, it will appear that TOPPS intentionally misled potential retailers and purchasers, which threatens to seriously diminish its image and credibility— developed over its 70-year existence—which cannot be “bought back” at any price. In contrast, a temporary restraint on the release of Defendant’s Cards will impose no hardship, prejudice or injury on Defendant. As explained in the Zucker Affidavit, it is
commonplace in the trading card industry for the release date for a particular card series to be delayed. (Zucker Aff., ¶ 10.) In fact, Defendant previously announced a May 22, 2008 release date for Defendant’s Cards (now pushed back, as discussed, to June 11, 2008). (Zucker Aff., ¶
10.) Thus, if the Defendant’s Cards are released a few days or even weeks later than anticipated, there is no reason the cards will be any less marketable or desirable to consumers. Nor is there any danger that, should a temporary restraint issue against the release of Defendant’s Cards, TOPPS will “beat” Defendant to the market. As Zucker attests, TOPPS has no plans to, and will not, release any Legends cards under the Agreement within at least the next 20 days. (Zucker Aff., ¶ 11.) II. THE PARTIES CMG is the premiere celebrity-licensing agency and is recognized around the world as agent and representative for such internationally recognized celebrities as Marilyn Monroe, James Dean, Ella Fitzgerald, and Chuck Berry. (Boyle Aff., ¶ 2.) CMG is also the exclusive worldwide agent for countless sports figures, including, as is relevant to this case, the Legends. (Boyle Aff., ¶ 2.) CMG, through its contractual agreements with the Legends, licenses to third parties the Legends’ Intellectual Property for commercial use on or in association with various products, goods, and services throughout the world. (Boyle Aff., ¶ 3.) Under its agreements with the Legends, CMG is also authorized to enforce the Legends’ Intellectual Property, which includes the right to send cease and desist letters, file formal opposition and cancellation proceedings, and pursue litigation on each Legend’s behalf. (Boyle Aff., ¶ 3.) TOPPS, which was founded in 1938, is a leading creator and marketer of sports and related trading cards, entertainment products and distinctive confectionery. (Zucker Aff., ¶ 1.) Defendant is also a creator and marketer of sports trading cards. TOPPS and Defendant are direct competitors in their highly-competitive industry.
STATEMENT OF FACTS A. Topps’ Exclusive Rights
In or about April 2008, TOPPS entered into Permission Agreements (the "Agreements"), which it negotiated with CMG for the use of the name, likeness, and statistical data of seventeen legendary deceased major league baseball players including the Legends. (Zucker Aff., ¶ 2; Boyle Aff., ¶¶ 5 and 6.) Under the Agreements, TOPPS acquired the following Legends’ Intellectual Property Rights: The exclusive right and license, subject to the limitations contained herein, to use the Property in connection with the Cards [trading cards] as outlined below: • Property’s name, likeness, and/or statistical data on or in connection with the manufacture, production, marketing, distribution and sale of all trading card products including, but not limited to base Cards, relic Cards featuring authentic cut signatures and/or pieces of game used equipment such as bats, jerseys, caps, etc., event/milestone Cards, advertising and/or promotional Cards, game Cars, digital/electronic Cards, and stickers. (Exhibit A, p. 1.) * * * (Zucker Aff., ¶ 3.) At the time of negotiation with CMG, it was (and remains) absolutely critical to TOPPS’ business interests to obtain the Rights on an exclusive basis. (Zucker Aff., ¶ 4.) Without this, TOPPS would not have entered into the Agreements. (Zucker Aff., ¶ 4.) B. Upper Deck’s Violation of Topps’ Rights
TOPPS learned on June 4, 2008 that Defendant had produced and delivered to its distributors its 2008 MLB SP Legendary Cuts series, which contains Defendant’s Cards. (Zucker Aff., ¶ 5.) According to its website, Defendant intends to release this series to the public on
June 11, 2008. (Zucker Aff., ¶ 5.) Defendant cannot in good faith dispute its prior knowledge of TOPPS’ exclusive rights. On April 14, 2008 TOPPS issued a press release (the “Press Release”) announcing its multi-year
deal for the exclusive rights to produce trading cards of, among other baseball greats, the Legends, each of whom is specifically identified in the Press Release. (Zucker Aff., ¶ 6.) Moreover, as discussed Defendant unsuccessfully bid against Topps to obtain the very same rights for several of the Legends that the Estates ultimately granted to Topps. (Zucker Aff., ¶ 6; Boyle Aff., ¶ 7.) Thus, Defendant necessarily fully understood and appreciated that the
Legends’ Intellectual Property Rights are a valuable asset, absent which Defendant lacked authority to produce Defendant’s Cards (otherwise, there would have been no reason for Defendant to be seeking those rights at all). Also, in 2004 Defendant acquired exclusive licenses for 14 or the 16 CMG clients currently under exclusive license with TOPPS. (Boyle Aff., ¶ 8.) Those agreements have expired, with the exception of the Babe Ruth license, which expires on June 30, 2008. (Boyle Aff., ¶ 8.) In each of the 2004 exclusive license agreements, Defendant warranted never to contest the rights of the licensor estates that they are now attempting to infringe upon. (Boyle Aff., ¶ 8.) In fact, over the course of CMG’s three decades of existence, Defendant had entered into over five hundred agreements for the use of other CMG clients’ intellectual property rights in which it made the same warranty. (Boyle Aff., ¶ 8.) * * * As we demonstrate next, Plaintiffs have met all of the legal requirements for obtaining injunctive relief. IV. ARGUMENT A. Legal Standard to Obtain Temporary Restraining Order under FED. R. Civ. P. 65(b).
The Federal Circuit has held that district courts deciding whether to preserve the status quo through a temporary restraining order (“TRO”) or preliminary injunction should consider the following four factors, with no one factor being dispositive: (1) Plaintiff is reasonably likely to succeed on the merits; (2) no adequate remedy at law exists; (3) Plaintiff will suffer irreparable
harm which, absent injunctive relief, outweighs the irreparable harm the defendant will suffer if the injunction is granted; and (4) the injunction will not harm the public interest. See Joelner v. Vill. of Washington Park, Illinois, 378 F.3d 613, 619 (7th Cir. 2004); Long v. Bd. of Educ., Dist. 128, 167 F.Supp.2d. 988, 990 (N.D.Ill.2001) (“The standards for issuing temporary restraining orders are identical to the standards for preliminary injunctions.”); Jack Guttman, Inc. v. Kopykake Enters., Inc., 302 F.3d 1352, 1356 (Fed. Cir. 2002); see also Venus Labs., Inc. v. Ecology & Env’t, Inc., Nos. 90 C 3749 & 90 C 4689, 1990 WL 1752583, at *2 (ND. Ill. Oct. 24, 1990) (The “requirements for a temporary restraining order are the same as for a preliminary injunction.”); Coca-Cola Co. v. Alma-Leo US.A., Inc., 719 F. Supp. 725, 729 (ND. Ill. 1989). Plaintiffs have the burden of proof to make a clear showing that they are entitled to the relief sought. See Goodman v. Illinois Dep’t of Fin. and Prof’l Regulation, 430 F.3d 432, 437 (7th Cir. 2005) (internal citations omitted). “The test is a flexible one; the arguments for one factor are particularly strong, an injunction may issue even if the arguments in other areas are rather weak.” Coll-Monge v. Inner Peace Movement, 050608 FEDDC, 07-7092 (D.C. Cir. 2008) quoting CityFed Fin. Corp. v. Office of Thrift Supervision, 58 F.3d 738, 747 (D.C. Cir. 1995) and CSX Transp., Inc. v. Williams, 406 F.3d 667, 670 (D.C. Cir. 2005). B. Legal Standard for Ex Parte Orders.
The Supreme Court has recognized that there are situations, albeit limited, in which a court may properly issue ex parte orders of brief duration and limited scope to preserve the status quo pending a hearing. See Granny Goose Foods, Inc. v. Teamsters, 415 U.S. 423, 438-39, 39 L. Ed. 2d 435, 94 S. Ct. 1113 (1974); Carroll v. Princess Anne, 393 U.S. 175, 180, 21 L. Ed. 2d 325, 89 S. Ct. 347 (1968). To obtain a temporary restraining order under FED. R. Civ. P. 65(b) without providing notice to the Defendant, Plaintiffs must show that irreparable injury will result “before the adverse party or that party’s attorney can be heard in opposition,” and must certify in writing “the efforts, if any, which have been made to give the notice and the reasons supporting the claim that notice should not be required.” T.R. 65(b). T
In addition, Rule 65(b) expressly contemplates the issuance of ex parte temporary restraining orders. Ex parte temporary restraining orders are no doubt necessary in certain circumstances, cf. Carroll v. President and Comm'rs of Princess Anne, 393 U.S. 175, 180, 21 L. Ed. 2d 325, 89 S. Ct. 347 (1968), but under federal law they should be restricted to serving their underlying purpose of preserving the status quo and preventing irreparable harm just so long as is necessary to hold a hearing, and no longer. Granny Goose Foods, supra, 415 U.S. at 438-39. In cases where notice could have been given to the adverse party, courts have recognized "a very narrow band of cases in which ex parte orders are proper because notice to the defendant would render fruitless the further prosecution of the action." Reno Air Racing Ass'n., Inc. v. Mccord, 452 F.3d 1126, 1131 (Fed. 9th Cir. 2006) quoting Am. Can Co. v. Mansukhani, 742 F.2d 314, 322 (7th Circuit 1984). In this action, the timing of the release of Defendant’s Cards make an ex parte restraining order as applied for by Plaintiffs of critical importance. Specifically there is no way that Plaintiffs can provide notice to Defendant of its ex parte filing and provide Defendant with an opportunity to be heard before the June 11, 2008 release of Defendant’s Cards. (Minch Aff., ¶ 2.) As such, a brief ex parte temporary restraining order to maintain the status quo is the only viable option. (Minch Aff., ¶ 2.) C. Plaintiffs are Likely to Prevail on the Merits. 1. Defendant’s Cards Violate the Right of Publicity.
In their Complaint, Plaintiffs have asserted, among other causes of action, claims under Indiana’s Right of Publicity Act and 43(a) of the Lanham Act. § 32-36-1-1 et. seq.; §43(a) of the Lanham Act, 15 U.S.C. §1125(a). Plaintiff’s claims under the Lanham Act include claims for unfair competition and false advertising in the nature of false endorsement. Under Indiana Code, where a third party violates the Right of Publicity under Ind. Code § 32-36-1-1 et. seq., the wronged party is entitled to a temporary or permanent injunctive relief (except where the infringer is a news reporting agency or an entertainment medium that that has
contracted with a person for the publication or broadcast of an advertisement and duly incorporated the advertisement in tangible form into material that has been prepared for broadcast or publication.) I.C. §§ 32-36-1-12 and 32-36-1-13. The elements of a Lanham Act false endorsement claim are similar to the elements of a right of publicity claim under Indiana law. Legal scholars have asserted that the elements of a Lanham Act false endorsement claim are similar to the elements of a Right of Publicity claim. See Bruce P. Keller, The Right of Publicity: Past, Present, and Future, 1207 PLI Corp. Law and Prac. Handbook, 159, 170 (October 2000). Therefore, cases which address both these types of claims should be instructive in determining whether Plaintiffs are likely to prevail as against Defendant as a result of Defendant’s knowing, intentional, willful, and malicious unauthorized commercial use of the Legends’ Intellectual Property. ETW Corporation v. Jireh Publishing, Inc., 332 F.3d 915 (Sixth Cir. 2003). Allen v. National Video, Inc., 610 F. Supp. 612, 630 (S.D.N.Y. 1985) (granting Woody Allen's request for injunction preventing use of look-alike in a commercial wherein Allen brought an action under the Lanham Act, 15 U.S.C. §1125(a) as a result of the lack of statutory or common law right of publicity in New York.) Defendant’s manufacture, production, distribution, and sale of Defendant’s Cards constitutes and infringement of the Legends’ Intellectual Property. The right of publicity is an intellectual property right of recent origin which has been defined as the inherent right of every human being to control the commercial use of his or her identity. See McCarthy on Publicity and Privacy, §1:3. The right of publicity is a creature of state law and its violation gives rise to a cause of action for the commercial tort of unfair competition. Id. The right of publicity is, somewhat paradoxically, an outgrowth of the right of privacy. See McCarthy on Publicity and Privacy, §1:4. A cause of action for violation of the right was first recognized in Haelan Laboratories, Inc. v. Topps Chewing Gum, Inc., 202 F.2d 866 (2nd Cir. 1953), where the Second Circuit held that New York's common law protected a baseball player's right in the publicity value of his photograph, and in the process coined the phrase "right
of publicity" as the name of this right. In what is now traditional right of publicity doctrine, the Court in Haelan recognized the value of and property right in a baseball player's photograph used on trading cards. The decision in Haelan was fortified by subsequent commentaries. Professor Melville B. Nimmer argued that, although publicity and privacy claims sometimes overlapped, privacy plaintiffs were concerned with unwanted intrusion into their personal lives, while publicity plaintiffs properly complained of uncompensated exploitation of their identities. See Nimmer, The Right of Publicity, 19 Law & Contemp. Probs, 203 (1954). He was joined by Professor William L. Prosser, who recognized "appropriation for defendant's advantage of the plaintiff's name or likeness" as one of the four different torts constituting invasion of privacy. See Prosser, Privacy, 48 Cal. L. Rev. 383, 398-407 (1960). Currently, under statutory and common law, the right of publicity is recognized in at least twenty-five (25) states, including Indiana. The Ohio Supreme Court recognized the right of publicity in 1976 in Zacchini v. ScrippsHoward Broadcasting Co., 47 Ohio St.2d 224, 351 N.E.2d 454 (1976).1 In Zacchini, which
involved the videotaping and subsequent rebroadcast on a television news program of plaintiff's human cannonball act, the Ohio Supreme Court held that Zacchini's right of publicity was trumped by the First Amendment. On appeal, the Supreme Court of the United States reversed, holding that the First Amendment did not insulate defendant from liability for violating Zacchini's state law right of publicity where defendant published the plaintiff's entire act. See Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562 (1977). United States Supreme Court decision on the right of publicity. There are no Indiana decisions which define the contours of Indiana’s right of publicity statute; however, as herein noted, because the Ohio right of publicity statute, passed after Indiana’s, closely resembles Indiana’s right of publicity statute, the few Ohio (and other
Zacchini is the only
In 1999, the right of publicity was codified in the provisions of Ohio Revised Code Chapter 2741. Ohio’s right of publicity statute closely mirrors that of Indiana though Indiana’s right of publicity statute, I.C. §32-36-1-1 et. seq., was passed in 1993, nearly six (6) years prior to Ohio’s statute. There is a void of Seventh Circuit and / or Indiana
jurisdiction) decisions defining the right of publicity in the aftermath of Zacchini provide more than adequate support for Plaintiffs’ claims of infringement. Furthermore, because case law on the right of publicity is exceedingly rare despite the general constitutional policy of maintaining uniformity in intellectual property laws, courts typically give attention to the entire available body of case law when deciding right of publicity cases. See, e.g., Cheatham v. Paisano Publications, Inc., 891 F. Supp. 381, 385 (W.D. Ky. 1995) (looking to federal law because Kentucky has not articulated the right's specific elements); Landham vs. Lewis Galoob Toys, Inc., 227 F.3d 619, 2000 Fed.App. 0328 (6th Circuit 2000); Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 162 (1989) In Parma International, Inc. v. Bartos, No. 89CA004573, 1990 Ohio App. LEXIS 508 (Feb. 7, 1990), the Ohio Court of Appeals for Lorain County reversed a trial court's grant of summary judgment for the defendant where the defendant had continued to use the plaintiff's name and likeness on the packaging of its product and in its advertising literature after the plaintiff ceased his employment with the defendant. The issue in Parma International was whether the plaintiff had consented to the continued use of his name and likeness. When the Ohio Supreme Court recognized the right of publicity, it relied heavily on the Restatement (Second) of Torts, §652. See Zacchini, 47 Ohio St.2d at 230. The court quoted the entire text of §652(C) of the Restatement, as well as comments a., b., c. and d. Id. The Restatement originally treated the right of publicity as a branch of the right of privacy and included it in a chapter entitled "Invasion of Privacy." In 1995, the American Law Institute transferred its exposition of the right of publicity to the Restatement (Third) of Unfair Competition, Chapter 4, §46, in a chapter entitled "Appropriation of Trade Values." The current version of the Restatement (Third) of Unfair Competition defines the right of publicity as follows:
case law interpreting Indiana’s right of publicity statute.
Appropriation of the Commercial Value of a Person's Identity: The Right of Publicity One who appropriates the commercial value of a person's identity by using without consent the person's name, likeness, or other indicia of identity for purposes of trade is subject to liability for the relief appropriate under the rules stated in §§ 48 and 49. Id. The right of publicity originated as a prohibition against misappropriating a person's "name or likeness." This idea of "name or likeness" has been stretched, most liberally under common law, to include, among other things, a look-alike, Allen v. National Video, Inc., 610 F. Supp. 612, 630 (S.D.N.Y. 1985) (granting Woody Allen's request for injunction preventing use of look-alike in a commercial); a nickname, Ali v. Playgirl, Inc., 447 F. Supp. 723, 728 (S.D.N.Y. 1978) (publication of drawing of nude black man labeled "The Greatest" entitled plaintiff to preliminary injunctive relief for violations of right-of-publicity); a phrase, Carson v. Here's Johnny Portable Toilets, Inc., 698 F. 2d 831, 837 (6th Cir. 1983) (use of the phrase "Here's Johnny" actionable under Michigan common law); a sound-alike-voice, Midler v. Ford Motor Co., 849 F.2d 460 (9th Cir. 1988) and Waits v. Frito-Lay, Inc., 978 F.2d 1093 (9th Cir. 1992), cert. denied, 506 U.S. 1080 (1993) (common law, but not statutory, cause of action applicable to appropriation of singer's voice in a commercial by voice impersonator); a unique and distinctively marked car, Motschenbacher v. R.J. Reynolds Tobacco Co., 498 F.2d 821 (9th Cir. 1974) (where defendant tobacco company used slightly modified footage of famous race car driver's car in a television commercial without permission, the driver's right of publicity was infringed); and a former name, Abdul-Jabbar v. General Motors Corp., 85 F. 3d 407 (9th Cir 1996) (allowing Kareem Abdul Jabbar to recover for use of his former name, Lew Alcindor, in a television commercial for General Motors). In White, television celebrity Vanna White, brought suit against Samsung Electronics, alleging that its television advertisement which featured a female-shaped robot wearing a long gown, blonde wig, large jewelry, and turning letters in what appeared to be the "Wheel of Fortune" game show set, violated her California common law right of publicity and her rights
under the Lanham Act. See White v. Samsung Electronics America, Inc., 989 F.2d 1512 (9th Cir. 1993). The Ninth Circuit, with Judge Alarcon dissenting in part, reversed the grant of summary judgment to defendant, holding that White had produced sufficient evidence that defendant's advertisement appropriated her identity in violation of her right of publicity, and that the issue of confusion about White's endorsement of defendant's product created a jury issue which precluded summary judgment on her Lanham Act claim. In this action, Defendant has expressly recognized the right of publicity and other ancillary rights such as trademarks and copyrights, in licensing from CMG the Legends’ (and others’) Intellectual Property via over 500 separate agreements for the use of the same. (Boyle Aff., ¶ 7.) Likewise, since 2004, Defendant’s had licensed the Legends’ (and other Hall of Fame professional baseball legends’) Intellectual Property Rights on or in association with the very products which Defendant now seeks to introduce to consumers. (Boyle Aff. at ¶ 7.) Defendant is well aware of not only the existence of the Legends’ Intellectual Property but that its use is illegal and contrary to its numerous prior warrantees not to contest the Legends’ Intellectual Property. (Boyle Aff. at ¶ 7.) 2. Defendant’s Cards Violate §43(a) of the Lanham Act, 15 U.S.C. §1125(a). Defendant’s use of the Legends’ Intellectual Property necessarily implies that the Legends, CMG, or TOPPS has endorsed Defendant’s Cards. The foundation of a claim for false endorsement under §43(a) of the Lanham Act, 15 U.S.C. §1125(a) is the misappropriation of another’s intellectual property rights in such a manner as to imply that the rightful owner, proprietor, or licensee of the rights has endorsed the goods, services or products bearing the misappropriated property. See McCarthy, The Rights of Publicity and Privacy, §5:30 (2d ed. 2000). Courts have recognized false endorsement claims under §43(a) of the Lanham Act where a celebrity's image or persona is used in association with a product so as to imply that the celebrity endorses the product. False endorsement occurs when a celebrity's identity is connected
with a product or service in such a way that consumers are likely to be misled about the celebrity's sponsorship or approval of the product or service. See, e.g., Wendt v. Host Int'l, Inc., 125 F.3d 806 (9th Cir. 1997) (animatronic robotic figures resembling actors in Cheers television program used to advertise chain of airport bars modeled on Cheers set); Abdul-Jabar v. General Motors Corp., 85 F.3d 407 (9th Cir. 1996)(athlete's name and accomplishments used in television advertisement for Oldsmobile automobiles); Waits v. Frito-Lay, Inc., 978 F.2d 1093 (9th Cir. 1992)(imitation of singer's unique voice used in radio commercial advertising Dorito Chips); White v. Samsung Electronics America, Inc., 971 F.2d 1395 (9th Cir. 1992)(female robot bearing resemblance to television celebrity, Vanna White, turning letters in what appeared to be the "Wheel of Fortune" game show set in television commercial advertising electronics products); Allen v. National Video, Inc., 610 F.Supp. 612 (S.D.N.Y. 1985)(photograph of Woody Allen look-alike in national advertising campaign for video club). In Landham v. Lewis Galoob Toys, Inc., 227 F.3d 619, 626 (6th Cir. 2000), the Sixth Circuit Court of Appeals noted that: A false designation of origin claim brought by an entertainer under §43(a) of the Lanham Act in a case such as this is equivalent to a false association or endorsement claim, see Waits, 978 F.2d at 1110, and the "mark" at issue is the plaintiff's identity. See White, 971 F.2d at 1399-1400. Id. at 626. The underlying question to be answered is whether the plaintiff has shown "that the public believe[s] that 'the mark's owner sponsored or otherwise approved of the use of the trademark.'" Wynn Oil Co. v. Thomas, 839 F.2d 1183, 1186 (6th Cir. 1988) (quoting Carson, 698 F.2d at 834). In Landham, the following eight-factor test for determining likelihood of confusion: 1. strength of plaintiff's mark; 2. relatedness of the goods; 3. similarity of the marks; 4. evidence of actual confusion; 5. marketing channels used; 6. likely degree of purchaser care; 7. defendant's intent in selecting the mark; and 8. likelihood of expansion of the product lines. Id. These are simply guidelines to aid in the analysis if Lanham Act claims and imply no mathematical precision, and a plaintiff need not show that all, or even most, of the factors listed are present in
any particular case to be successful. Id. There can be no evidence of actual confusion because Defendant has not yet released Defendant’s Cards to the public. Factors 2, 3, 5, and 8, weigh heavily in favor of Plaintiffs; Defendant used the Legends’ Intellectual Property rights knowingly, intentionally, willfully, and maliciously in association with Defendant’s Cards. Defendant is using the Legends’ Intellectual Property Rights in a manner that is identical to the manner in which TOPPS is licensed to use those same rights, on goods that are identical to those of TOPPS and will be released in the same channels of trade. Defendant’s intent in “selecting” the Legends’ Intellectual Property also tips heavily in favor of Plaintiffs. Until February, 2008, Defendant remained in negotiation with CMG for the use of the Legends’ Intellectual Property for the very goods (Defendant’s Cards) that it is using them without license or authority. And, until recently, Defendant had various agreements with CMG and the Legends for the use of the Legends’ Intellectual Property. Defendant’s intent in selecting the “marks” to be used on or in connection with Defendant’s Cards is unmistakable and in bad faith. There can be no plausible argument that the Legends’ Intellectual Property does not constitute strong, well-known “marks.” Defendant itself has paid significant monies to secure the right to utilized the Legends’ Intellectual Property in the past and has realized significant revenue from the sale of goods or services using them. Further, TOPPS has paid a significant amount of money in return for the exclusive right to use the Legends’ Intellectual Property on or in connection with the very class of goods that Defendant seeks to introduce into the marketplace, ahead of TOPPS, without prior authorization from Plaintiffs. The Legends’ Intellectual Property was developed exclusively and solely as a result of the hard work, expense, and efforts of the Legends and CMG. (Boyle Aff., ¶ 4.) It holds
tremendous commercial value, has been continuously used for commercial purposes during each of the Legend’s lifetimes, and has been used continuously and is still presently used for
commercial purposes and protected from unauthorized misuses following each of the Legend’s deaths; as such, to this day, consumers the world around readily identify and recognize the Legends’ Intellectual Property. (Boyle Aff., ¶ 4.) As such, the Legends’ Intellectual Property has inextricably become one and the same with each of the Legend’s individual images and personae and, as such, exclusively and solely represents the Legends. Finally, under factor 8, it is also likely that Defendant will expand Defendant’s Cards to include other goods, services, or products on or in connection with Defendant will seek to use the Legends’ Intellectual Property without authorization. According to its website, Defendant claims to have revolutionized the sports trading card experience in 1988 and names as its number one mission the capture of the excitement of the game and the delivery so-called excitement to fans of all ages through collectible products. (Boyle Aff., ¶ 11.) According to Defendant, although the cornerstone of its overall business interests is based on sports trading cards, Defendant claims to be building upon its sports trading card business to enter other realms. (Boyle Aff., ¶ 11.) As such, there can be little doubt that Defendant will expand its knowing, intentional, willful, and malicious unauthorized use of the Legends’ Intellectual Property. (Boyle Aff., ¶ 11.) D. Plaintiff Will Suffer Irreparable Harm If Defendant is Not Enjoined.
Plaintiffs will be irreparably injured in that actual and potential consumers will be misled and confused regarding the source, sponsorship, and origin of Defendant’s Cards. Consumers
will mistakenly believe that Defendant’s Cards, which, without authorization, bear the Legends’ Intellectual Property, originate from or are authorized, sponsored, or approved by the Legends, CMG or TOPPS. Unless it is enjoined, Defendant will release the offending Defendant’s Card into the market on June 11th. If this happens, both TOPPS and CMG will sustain irreparable harm. As to CMG, it will appear that CMG has “double exclusively licensed” the Rights, has breached its exclusive agreements with TOPPS or does not actively monitor and protect its clients’ rights, all of which threatens to seriously diminish CMG’s standing and reputation as the premiere
celebrity-licensing firm, which CMG has carefully and painstakingly cultivated over the last three decades. (Boyle Aff., ¶ 10.) Similarly with TOPPS, by an April 14, 2008 press release, entitled “Multi-Year Deal Gives Topps Exclusive Rights to Produce Trading Cards of Major League Baseball’s Greatest,” TOPPS announced to the industry its exclusive rights for the use of the Legends. If
Defendant’s Cards enter the market, it will appear that TOPPS intentionally misled potential retailers and purchasers, which threatens to seriously diminish its image and credibility— developed over its 70-year existence—which cannot be “bought back” at any price. (Zucker Aff., ¶ 9.) E. Defendant Will Suffer Minimal Harm or Prejudice If Enjoined.
In contrast, a temporary restraint on the release of Defendant’s Cards will impose no hardship, prejudice or injury on Defendant. As explained in the Zucker Affidavit, it is
commonplace in the trading card industry for the release date for a particular card series to be delayed. (Zucker Aff., ¶ 10.) In fact, Defendant previously announced a May 22, 2008 release date for Defendant’s Cards (now pushed back, as discussed, to June 11, 2008). (Zucker Aff., ¶ 10.) Thus, if the Defendant’s Cards are released a few days or even weeks later than anticipated, there is no reason the cards will be any less marketable or desirable to consumers. (Zucker Aff., ¶ 10.)
Nor is there any danger that, should a temporary restraint issue against the release of Defendant’s Cards, TOPPS will “beat” Defendant to the market. As Zucker attests, TOPPS has no plans to, and will not, release any Legends cards under the Agreement within at least the next 20 days. (Zucker Aff., ¶ 11.)
The Balance of Hardships Weighs Heavily in Plaintiffs’ Favor.
As discussed, Plaintiffs will suffer irretrievable loss of good will and reputation if Defendant is permitted to release Defendant’s Cards into the marketplace. Any hardship that Defendant may claim to suffer if an injunction issues is entirely of Defendant’s own making:
Defendant knowingly, intentionally, willfully, and maliciously engaged in the infringing activities at issue; Defendant previously negotiated for the Legends’ Intellectual Property, and were necessarily aware that they could not proceed without those rights but chose to proceed anyway; Defendant in its prior licenses warranted that it would not challenge the Legends’ Intellectual Property Rights; and Defendant knew from the TOPPS Press Release that TOPPS intends to produce trading cards incorporating the Legends’ Intellectual Property Rights.
Defendant cannot claim that any losses it may suffer as a result of having to change to a non-infringing use is a viable hardship. See Novartis Consumer Health, Inc. v. Johnson & Johnson Merck Pharmaceuticals, 129 F. Supp. 27 2d 351, 369 (D.N.J. 2000), aff’d 290 F.3d 578 (3d Cir. 2002); see also Surdyk’s Liquor, Inc. v. MGM Liquor Stores, Inc., 83 F. Supp. 2d 1016, 1028 (D. Minn. 2000) (party has no economic right to fruits of conduct that violates the law). On balance, Plaintiffs will bear a far greater burden in the absence of an injunction than Defendant will bear if an injunction issues. The relief Plaintiffs seek is reasonable. Plaintiffs are not seeking to enjoin Defendant from marketing and selling its baseball cards entirely; they simply seeks to prevent Defendant’s use of the Legends’ Intellectual Property. See Visioneer, Inc. v. Umax Technologies, Inc., 1998 U.S. Dist. LEXIS 23431 (balance of hardships weighed in favor of movant where movant did not seek to entirely prevent advertising of the defendant’s’product). Even if Defendant ultimately prevailed at trial, the only hardship Defendant could claim is that Defendant would have begun earning profits on the sale of its products earlier. Such hardship, however, does not outweigh the irreparable harm that would be suffered by Plaintiffs by an early launch given the clear evidence of infringement. See Glaxo Group Ltd. v. Apotex, Inc., 64 Fed. App’x at 756 (affirming district court’s decision that the balance of hardships favored the patentee when the generic company “would only lose the ability to go to market and begin earning profits earlier”).
And, as mentioned, the release of the Defendant’s Cards has
already been delayed once and delays in the release of baseball cards are commonplace. (Zucker
Aff. ¶10). G. The Requested Preliminary Injunction Would Serve the Public Interest.
Granting a preliminary injunction would serve the public interest here. It is well-settled that the "public interest" relevant to the issuance of an injunction in intellectual property disputes is the public's interest in avoiding unnecessary confusion. See, e.g., Davidoff & CIE, S.A. v. PLD Intern. Corp., 263 F.3d 1297, 1304 (11th Cir. 2001) ("[T]he public interest is served by preventing consumer confusion in the marketplace."); SunAmerica Corp., 77 F.3d at 1334 (noting even in cases involving acquiescence, "the public interest in preventing confusion around the marketplace is paramount to any inequity caused the junior user" by issuance of injunction); Coach House Rest., 934 F.2d at 1564 ("[P]ublic interest in preventing confusion around the marketplace is paramount. . . . ").
CONCLUSION For the foregoing reasons, this Court should grant CMG’s and TOPPS’ Ex Parte
Application for Emergency Temporary Restraining Order. DATED: June 9, 2008 SOVICH MINCH, LLP,
/s/ Theodore J. Minch ____________________________________ Theodore J. Minch (IN#18798-49) Attorney for CMG WORLDWIDE, INC. and THE TOPPS COMPANY, INC. 10099 Chesapeake Drive, Suite 100 McCordsville, Indiana 46055 (317) 335-3601 (t)