American Direct Marketing v. AZAD INTERN.
| Citation | 783 F. Supp. 84 |
| Decision Date | 31 January 1992 |
| Docket Number | No. CV-91-3885.,CV-91-3885. |
| Parties | AMERICAN DIRECT MARKETING, INC., et al., Plaintiffs, v. AZAD INTERNATIONAL, INC., et al., Defendants. |
| Court | U.S. District Court — Eastern District of New York |
COPYRIGHT MATERIAL OMITTED
Rosner & Goodman, New York City, for plaintiffs.
Cooper & Dunham, New York City, for defendants Ajit Khubani and Telebrands defendants.
Colucci & Umans, New York City, for defendants Azad, and Victor and Ashok Khubani.
CORRECTED MEMORANDUM AND ORDER
The matter is currently before the Court on a motion for a preliminary injunction in a case involving alleged infringement of copyrights, trademarks, and trade dress. For the reasons discussed below, the motion is denied without an evidentiary hearing. Defendants' request to consolidate this case with one now pending before Judge Dearie is denied. Plaintiffs' request for permission to amend the complaint is granted on condition. Their request for expedited discovery is referred to Magistrate Judge Ross to whom the case has been assigned.
This case involves competition by television advertising and direct mail marketing. The parties both began to sell a three-part tooth whitening system and a rotating toothbrush at approximately the same time. The merchandise is not patented. Therefore, the protagonists have employed other legal theories in their attempts to protect their profits.
Plaintiffs make claims under both intellectual property theories and contract. The current motion requests broad preliminary relief based on the intellectual property claims.
Plaintiffs' allegations in support of the various intellectual property claims made are, to say the least, unclearly stated. While the plaintiffs' papers are confused as to what items are sought to be protected under what theory, such a determination is essential since the requirements for relief and protection afforded under the various theories are not identical.
This Court reads these papers to make the requests for protection discussed below. Any others touched on by the plaintiffs have simply not been developed sufficiently to establish a prima facie case.
Under copyright, plaintiffs request protection for two items: a short television commercial and the text of the instructions for use of a tooth whitening system. Plaintiffs also request permission to amend their complaint to seek protection for the artwork and other text (beyond the instructions) presently used in the insert to their clam-pack. (A "clam-pack" is a type of package in which the product is enclosed in a clear plastic wrapping.)
Copyright protects "original works of authorship" pursuant to 17 U.S.C. §§ 101 et seq. and covers commercial items including mundane advertisements. Bleistein v. Donaldson Lithographing Co., 188 U.S. 239, 23 S.Ct. 298, 47 L.Ed. 460 (1903). A prima facie case of copyright infringement requires a showing that a plaintiff holds a valid copyright for the work and that a defendant has copied protected elements of that work. Defenses include permission to use the original work and independent creation of the allegedly infringing work.
A preliminary injunction based on copy-right must be denied with respect to the commercial sought to be protected because the elements allegedly copied are not protectible subject matter.
As to the balance of plaintiffs' copyright claims, a hearing might be appropriate in other circumstances as the plaintiffs have made out a prima facie case for infringement; defendants' papers raise the defense of independent creation as to the artwork and permission as to the instructions and material facts are disputed. However, as discussed below, it is inappropriate in the circumstances of this case to invoke the presumption of irreparable harm usually resorted to in copyright cases, and irreparable harm has not been otherwise demonstrated. Accordingly, a preliminary injunction based on copyright must be denied without a hearing due to plaintiffs' failure to make even a prima facie showing of irreparable harm.
Under the law of trademark and trade dress, plaintiffs seek to protect the word PLAK-AWAY, which they use for a rotating toothbrush, and the appearance of two packages for their tooth whitening system. These packages will be referred to as the opaque box and the clam-pack.
Neither of these has been registered as marks with either federal or state agencies. The plaintiffs seek protection under the Lanham Act, 15 U.S.C. § 1125(a), New York State Genl. Bus. Law § 368-d, and the New York state common law of unfair competition.
The law of trademarks (including trade dress) protects the consumer's mental association between the commercial item and the source of that item.
All of these bases of protection require, inter alia, a showing of the existence of consumer mental association between the specific item and its commercial source. Because the showing of this association is insufficient, a preliminary injunction is also inappropriate on any of these claims.
Before discussing each of these claims, I turn as a preliminary matter to a request for consolidation, a request for leave to amend the complaint, and a request for expedited discovery.
Defendants request consolidation of this case with a case currently before Judge Dearie, Howe Chemicals v. CCA Industries, CV-91-0631. Plaintiffs oppose this request.
Local rule 50.3 allows a motion for consolidation of related cases. Cases are related if the facts or legal issues are sufficiently similar so that "a substantial saving of judicial resources" would likely result from consolidation.
The case before Judge Dearie involves one of the plaintiffs here, Howe Chemical, which is alleged in the case before Judge Dearie to have infringed CCA Industries' trade dress rights in a package for a tooth whitening system. The trade dress alleged to be infringing is Howe's clam-pack.
This clam-pack is also alleged to have been infringed in the instant suit. There is no other identity of parties or issues between the suits. Even as to the common item, the factual issues raised are different. This very limited overlap is insufficient to make it likely that consolidation would lead to a substantial saving of judicial efforts. Defendants' request for consolidation is, therefore, denied.
By papers dated October 29, 1991, plaintiffs request leave to amend their complaint to add the following:
"(i) copyright infringement of the art-work and text (in addition to the instructions) on plaintiffs' packaging, (ii) trade dress infringement of plaintiffs' display box packaging, and (iii) copyright infringement based on Defendants' use of Plaintiffs' instructions on all of Defendants' `Dazzle' packaging Dazzle is defendants' tradename for the tooth-whitening system."
In addition, plaintiffs wish to amend the complaint by adding as a defendant Telebrands Direct Response Corporation ("TDRC") which is one of the interacting corporations said to be largely owned by defendant Ajit Khubani.
Fed.R.Civ.P. 15(a) directs courts to be liberal in granting requests to amend pleadings. This request is made very shortly after the commencement of the suit. The Telebrands defendants and Ajit Khubani have stated they do not oppose these requests to amend the complaint.
Leave to amend is, therefore, granted on the following condition: plaintiffs must clarify the language of this amendment by stating the copyright registrations involved. As currently worded, the new claims are too elastic. Defendants deserve notice of the extent of the claims made.
As to expedited discovery, this application is opposed by all defendants on various grounds. Since, for the reasons discussed below, no preliminary injunction hearing will be held, I will not set a discovery schedule but will follow the usual practice of referring the matter to Magistrate Judge Ross to whom the case is assigned.
The following facts, except where expressly noted or described as an allegation, are undisputed. Plaintiffs in this action are four corporations, in all of which Herman S. Howard ("Howard") is president and/or chairman of the board: American Direct Marketing, Inc. ("American Direct"), American Four Marketing, Inc. ("American Four"), Howe Plastics and Chemical Company d/b/a Howe Co. ("Howe Plastics"), and Howe Laboratories, Inc. ("Howe Labs"). Plaintiffs refer to the last two collectively as "Howe."
The plaintiffs' products at issue in this suit are a rotating tooth brush (known both as "Plak-Away" and "Neutra-Plaque") and a tooth whitening system (know both as "Pearly White" and "Instant White"). Also at issue are certain commercials and so-called "infomercials" (programs sponsored by businesses to provide information on their products) for these products.
American Direct is the distributor of these products for direct sale to consumers. American Four handles the advertising and promotion. Howe is a packager and distributor to retail stores.
Defendants in this action are Azad International, Inc. ("Azad"), Telebrands Direct Response Corporation ("TDRC" formerly known as Direct Marketing of Virginia, Inc.), Telebrands Advertising Corporation ("Telebrands Advertising"), Telebrands Wholesale Corporation ("Telebrands Wholesale," formerly known as U.S. Buyers Network), Telebrands Retail Corporation ("Telebrands Retail," formerly known as As Seen on TV, Inc.) (the four immediately prior corporations will be referred to together as the "Telebrands Defendants" or "Telebrands Corps."), Victor Khubani ("Victor"), Ashok (Chuck) Khubani ("Chuck"), Chuck Khubani d/b/a AP Wholesalers ("AP"), and Ajit Khubani ("Ajit").
Azad and AP are suppliers of the toothbrush. However, other sources for the same brush exist. Victor is the sole owner of all voting shares of Azad. AP is a partnership; one of the partners is Victor's son, Chuck.
TDRC is a direct marketing business and is affiliated with the other Telebrands Defendants....
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