Kelly-Brown v. Oprah Winfrey, Harpo Prods., Inc.

• Citation: 717 F.3d 295
• Decision Date: 31 May 2013
• Docket Number: Docket No. 12–1207–cv.
• Parties: Simone KELLY–BROWN and Own Your Power Communications, Inc., Plaintiffs–Appellants, v. Oprah WINFREY, Harpo Productions, Inc., Harpo, Inc., Hearst Corporation, Hearst Communications, Inc., Wells Fargo & Co., Estee Lauder Companies, Inc., Clinique Laboratories, LLC, Chico's FAS, Inc., ABC Companies (1–100), and John Does (1–100), Defendants–Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

717 F.3d 295

Simone KELLY–BROWN and Own Your Power Communications, Inc., Plaintiffs–Appellants,

v.Oprah WINFREY, Harpo Productions, Inc., Harpo, Inc., Hearst Corporation, Hearst Communications, Inc., Wells Fargo & Co., Estee Lauder Companies, Inc., Clinique Laboratories, LLC, Chico's FAS, Inc., ABC Companies (1–100), and John Does (1–100), Defendants–Appellees.

Docket No. 12–1207–cv.

United States Court of Appeals,Second Circuit.

Argued: Sept. 25, 2012.

Decided: May 31, 2013.

Patricia Lawrence–Kolaras, The PLK Law Group, P.C., Hillsborough, NJ, for Plaintiffs–Appellants.

Jonathan R. Donnellan (Ravi V. Sitwala, Debra S. Weaver, on the brief), The Hearst Corporation, New York, NY, Charles L. Babcock, Jackson Walker L.L.P., Houston, TX, for Defendants–Appellees.

Before: STRAUB, SACK and CHIN, Circuit Judges.

Judge SACK concurs in the result in a separate opinion.

STRAUB, Circuit Judge:

Plaintiff Simone Kelly–Brown (“Kelly–Brown”) is the owner of a motivational services business, Own Your Power Communications, Inc., that holds events and puts out publications under the registered service mark “Own Your Power.” Defendants Oprah Winfrey (“Oprah”), Harpo, Inc., and Harpo Productions, Inc. (collectively, “Harpo”), and Hearst Corp. and Hearst Communications, Inc. (collectively, “Hearst”) were involved in the production of a magazine, event, and website also employing the phrase “Own Your Power.” Kelly–Brown argues that in so using the phrase, the defendants infringed upon her mark. She brings suit for claims including trademark infringement, false designation of origin, reverse confusion, and counterfeiting. She also brings suit for vicarious and contributory infringement against Wells Fargo & Co. (“Wells Fargo”), Clinique Laboratories, LLC (“Clinique”), Estee Lauder Cos., Inc. (“Estee Lauder”), and Chico's FAS, Inc. (“Chico's”), which were all corporate sponsors of the allegedly infringing “Own Your Power” event.

Kelly–Brown appeals from the grant of a motion to dismiss in the Southern District of New York (Paul A. Crotty, Judge ), finding that the defendants' use of the phrase “Own Your Power” was fair use. The District Court dismissed Kelly–Brown's counterfeiting, vicarious infringement, and contributory infringement claims on additional grounds. Because we find that the defendants have not adequately established a fair use defense, we VACATE the judgment of the District Court with respect to Kelly–Brown's trademark infringement, false designation of origin, and reverse confusion claims and REMAND this case for further proceedings not inconsistent with this opinion. We agree with the District Court's holdings with respect to Kelly–Brown's vicarious infringement, contributory infringement, and counterfeiting claims and therefore AFFIRM with respect to these claims.

BACKGROUND

The allegations recited below are taken from the complaint, and we assume they are true for the purposes of this appeal.

Kelly–Brown owns a motivational services business organized around the concept “Own Your Power.” Kelly–Brown hosts a radio show, holds conferences and retreats, and writes a blog promoting the concept of “owning” one's power. She also has a federally registered service mark in the phrase “Own Your Power.”

The service mark registered with the United States Patent and Trademark Office is displayed in a distinctive font that Kelly–Brown uses on her website and other materials, as follows: ¹

IMAGE

The service mark states, “THE COLOR(S) LIGHT BLUE IS/ARE CLAIMED AS A FEATURE OF THE MARK. THE MARK CONSISTS OF LIGHT BLUE SCRIPTED LETTERS WHICH CREATE THE WORDS OWN YOUR ‘POWER.’ ” Kelly–Brown's service mark was registered May 27, 2008.

Defendant Oprah almost needs no introduction, but warrants one in this context. She runs a vast media empire, which consists of, inter alia, a magazine, and a website, which is run by Harpo, and (until recently) a television program. Oprah's name and IMAGE The Power List therein consisted of a list of people who were influential in various fields, with each serving as an example of a particular “kind” of power. For example, one page contained a photograph of the actress Julia Roberts and a paragraph describing her. Set off from the text is a red circle containing the phrase “THE POWER OF ... living large.”

On September 16, 2010, the Magazine, in connection with various other businesses, including defendants Wells Fargo, Clinique, and Chico's, held an “Own Your Power” event (the “Event”). At the Event, various celebrities posed for promotionalphotographs in front of an “Own Your Power” backdrop that also contained trademarks for Chico's, Wells Fargo, Clinique, and the Magazine. The Event involved a seminar and workshop offering motivational advice regarding self-awareness, self-realization, and entrepreneurship, under the aegis of the theme “Own Your Power.” The Event was subsequently described in the December 2010 issue of the Magazine as the “FIRST–EVER OWN YOUR POWER EVENT.”

Following the Event, the Harpo website (the “Website”) contained video clips from the Event and placed “Own Your Power” banners and content on at least 75 different individual webpages. Each page containing the “Own Your Power” banner displayed the same header IMAGE

The October issue contained pages with a similar format, with the phrase “the power of ...” surrounded by various concepts written in colored circles, each beginning with an ellipsis. The “Own Your Power” bannered pages of the website included articles such as, “How to Tap Into Your True Power,” “Motivation: One Entrepreneur's Fabulous Story,” and “The Secrets of Success.” Each page is accompanied by banner advertisements.

Approximately two weeks after the Event occurred, the Magazine's Facebook page displayed photographs taken that evening. On September 27, 2010, Oprah appeared on her television show and displayed the cover of the October 2010 issue of the Magazine. In addition, the December 2010 issue of the Magazine, circulated around November 13, 2010, contained information encouraging readers to view the videos from the Event online at the Website.

Following the Magazine's Own Your Power cover, Kelly–Brown and Own Your Power Communications, Inc. received numerous inquiries from people who appear to have confused Kelly–Brown's services with Oprah's Event, Website, and Magazine. Competition from Oprah has been detrimental to Kelly–Brown's brand.

As a result, Kelly–Brown brought this suit in the District of New Jersey on July 28, 2011, alleging six causes of action under the Lanham Act: trademark counterfeiting, trademark infringement, reverse confusion, false designation of origin, contributory trademark infringement, and vicarious trademark infringement, as well as seven New Jersey state law claims. On November 3, 2011, the District of New Jersey granted a motion to transfer venue of the case to the Southern District of New York.

The defendants moved to dismiss. The District Court granted their motion in its entirety. Kelly–Brown v. Winfrey, No. 11 Civ. 7875, 2012 WL 701262 (S.D.N.Y. Mar. 6, 2012). With regard to the Lanham Act claims, the District Court held that the defendants' use of the words Own Your Power constituted fair use. The defense of fair use requires proof that the use was made “(1) other than as a mark, (2) in a descriptive sense, and (3) in good faith.” JA Apparel Corp. v. Abboud, 568 F.3d 390, 400 (2d Cir.2009) (internal quotation marks omitted).

The District Court first reasoned that defendants engaged in a non-trademark use because there was no chance that an observer of the Magazine or Event would believe that they were created by Kelly–Brown and her company. Kelly–Brown, 2012 WL 701262, at *3. It noted that Oprah was pictured on the October 2010 Magazine cover, indicating to the viewer who it was that had put forward the Magazine. Id. Further, it stated that the placement of the phrase on the Magazine's cover indicated that it was simply a headline describing the contents of the Magazine. Id. In deciding that the Magazine Cover employed a non-trademark use of “Own Your Power,” the District Court indicated that the satisfaction of the first factor of the fair use analysis alone would be sufficient to dismiss Kelly–Brown's Lanham Act claims, but it went on to discuss the other two elements of the analysis because these, too, it believed, supported its determination that the defendants had engaged in fair use of the phrase “Own Your Power.” Id. at * 4.

Thus, the District Court determined that the use of the words “Own Your Power” was descriptive because it described an action that it hoped that Magazine readers would take after reading the Magazine. Id. at *4–5.

Finally, the District Court held that the defendants did not exhibit bad faith in using the mark. It decided that Kelly–Brown had pleaded no facts that plausibly suggested that the defendants intended to capitalize on her good will. Id. at *6. It reasoned further that there was no likelihood of consumer confusion because the font, color, and formatting of the defendants' use was significantly different from that protected by Kelly–Brown's registered service mark. Id. The District Court therefore held that all three of the elements of the fair use defense were met.

Having found that the defendants' use constituted fair use, the District Court went on to dismiss Kelly–Brown's trademark infringement, reverse confusion, and false designation of origin claims on that basis. Id. at *6–7. With regard to contributory and vicarious trademark infringement, it held that those claims should be dismissed because there was no primary infringement to which any defendant could have contributed, and because Kelly–Brown had not adequately alleged a partnership or agency relationship among any of the defendants. Id. at *7–8.

The District Court then dismissed Kelly–Brown's trademark counterfeiting claim because there was no evidence that the defendants' use was identical in appearance to...