American Family Life Ins. Co. v. Hagan

• Decision Date: 25 October 2002
• Docket Number: No. 1:02-CV-1791.,1:02-CV-1791.
• Citation: 266 F.Supp.2d 682
• Parties: AMERICAN FAMILY LIFE INSURANCE COMPANY, Plaintiffs v. Timothy HAGAN, et al, Defendants.
• Court: U.S. District Court — Northern District of Ohio

266 F.Supp.2d 682

AMERICAN FAMILY LIFE INSURANCE COMPANY, Plaintiffs v. Timothy HAGAN, et al, Defendants.

No. 1:02-CV-1791.

United States District Court, N.D. Ohio, Eastern Division.

October 25, 2002.

COPYRIGHT MATERIAL OMITTED

Christopher B. Fagan, Jude A. Fry, Fay Sharpe Fagan Minnich & McKee, Cleveland, OH, John D. Haynes, Alston & Bird, LLP, Atlanta, GA, Jayne L. Jakubaitis, Bricker & Eckler, Cleveland, OH, David J. Stewart, Alston & Bird, LLP, Atlanta, GA, for Plaintiffs.

Richard M. Knoth, Bricker & Eckler, David R. Posteraro, Arter & Hadden, Cleveland, OH, for Defendants.

MEMORANDUM AND ORDER

O'MALLEY, District Judge.

Plaintiff American Family Life Assurance Company of Columbus ("AFLAC") brings this action against two defendants: (1) Timothy Hagan, who is currently a candidate for Governor of the State of Ohio, and (2) the Tim Hagan for Governor Campaign (collectively, "Hagan"). AFLAC, which is a leading provider of "supplemental" insurance,¹ is the sponsor of the well-known "AFLAC Duck" commercials, in which a white duck quacks the company's name in a distinctive, nasal tone. Hagan, who is running against incumbent Governor Robert Taft, has created his own internet commercials which "borrow" from AFLAC's commercials. Specifically, Hagan's internet commercials include a crudely animated character made up of Governor Taft's head sitting on the body of a white cartoon duck; the duck quacks "TaftQuack" several times during each commercial. Hagan broadcasts these commercials at his website, www.taftquack.com.²

In its amended complaint, AFLAC states the following claims: (1) trademark and service mark dilution, in violation of Section 43(c) of the Lanham Act, 15 U.S.C. § 1125(c); (2) copyright infringement, in violation of the Copyright Act of 1976, 17 U.S.C. § 101 et seq.; (3) trademark infringement, in violation of Section 32(1) of the Lanham Act, 15 U.S.C. § 1114(1); (4) false designation of origin, in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a); (5) unfair competition, in violation of Ohio common law; and (6) trademark and service mark dilution, in violation of Ohio common law. Hagan has responded with counterclaims asserting that AFLAC's service marks, trademarks, and copyrights should all be declared invalid because they are generic and/or unregisterable.

On September 11, 2002, AFLAC filed a motion for temporary restraining order ("TRO"), asking the Court to enjoin, inter alia, further broadcast of the "TaftQuack" commercials and further use of the www.taftquack.com website address. The Court held a hearing on September 18, 2002 and issued an oral ruling from the bench, denying the motion for TRO. The Court then held a preliminary injunction hearing on October 16, 2002. At this hearing, the parties did not adduce additional evidence. Rather, the parties agreed that all relevant evidence had been made a part of the record as appendices to earlier-filed briefs,³ and also agreed that there were no issues of material fact. The parties' arguments and submissions make clear that resolution of their disagreement depends on the Court's application of the law to the undisputed facts. The precise issues raised appear to be one of first impression.

For the reasons stated below, the motion for preliminary injunction is DNIED. Counsel for the parties are directed to appear on November 20, 2002, at 10:00 a.m., for a status conference, to establish a discovery schedule and set a trial date.

I. Facts.

As noted, the parties agree on the following facts. Beginning in December of 1999, AFLAC began a television advertising campaign, the centerpiece of which was a white duck quacking the name of the company in response to people discussing the subject of supplemental insurance. AFLAC has created 11 commercials using the "AFLAC Duck," and has broadcast these commercials repeatedly during popular television viewing hours.⁴ As a result, the AFLAC Duck enjoys very high public recognition. To protect its investment in creating and marketing the AFLAC Duck character, AFLAC applied for and received from the United States Patent and Trademark Office ("USPTO") several service marks and trademarks ("the AFLAC Duck Marks"), including service mark 2,607,415, which "consists of the sound of a duck quacking the word `AFLAC.'" '415 mark at 1. AFLAC has also received copyright registrations of its AFLAC Duck commercials.

On November 5, 2002, Ohio voters will elect their next Governor; the principal candidates are Republican incumbent Bob Taft and Democrat challenger Tim Hagan. Beginning in late August of 2002, as part of his campaign, Hagan began to broadcast commercials on the internet at the website address www.taftquack.com These commercials feature an animated character referred to as "TaftQuack." TaftQuack consists of Governor Taft's head on the body of a white duck; a yellow duck's bill sits where Governor Taft's mouth should be. In some commercials, the TaftQuack character is asked questions; his response is to quack the word "Duck," hide for a moment, and then quack "TaftQuack." In other commercials, the TaftQuack character views several segments of Governor Taft's own political commercials and responds to each segment by quacking "TaftQuack." Whenever the TaftQuack character speaks, a cartoon speech balloon appears containing the same words, in writing, that are spoken. The duck's "TaftQuack" sound is highly reminiscent of the "AFLAC" sound made by the AFLAC Duck.⁵ To date, Hagan has created and broadcast four such commercials.

In addition to the www.taftquack.com website, Hagan also operates a website at the address www.timhaganforgovernor.com latter website is more staid, and the TaftQuack commercials do not appear there; however, the www.timhagan-forgovernor.com website does contain a link to www.taftquack.com.Similarly, the www.taftquack.com website contains a link titled "to make a contribution, click here;" by clicking on the link, the user is directed to www.timhaganforgovernor.com, where the user can make a contribution online. Thus, it is fair to say that Hagan uses the www.taftquack.com website to solicit campaign contributions.

AFLAC asserts that Hagan has purposefully "created the TaftQuack character to increase Hagan's voter recognition by trading on the substantial consumer recognition and goodwill of the famous AFLAC Duck." Memo, in support of TEO at 4-5. By doing so, AFLAC argues, Hagan "appropriated" the AFLAC Duck Marks, causing AFLAC to suffer loss of "control over the goodwill it has labored at great effort and expense to build." Id. at 1. AFLAC also adds that Hagan's TaftQuack commercials have "tarnishe[d] the AFLAC [Duck Marks] by politicizing what is designed to be an apolitical character and by associating the character in the minds of the consuming public with a candidate and political views that AFLAC neither sponsors nor endorses." Id. at 1-2. Accordingly, AFLAC asks the Court to issue a preliminary injunction enjoining further use by Hagan of the TaftQuack character and associated website address.

II. Analysis.

A Standards for Relief.

A preliminary injunction is a provisional remedy authorized under Fed. R.Civ.P. 65. It is "an extraordinary and drastic remedy, one that should not be granted unless the movant, by a clear showing, carries the burden of persuasion." Mazurek v. Armstrong, 520 U.S. 968, 117 S.Ct. 1865, 1867, 138 L.Ed.2d 162 (1997) (quoting 11A C. Wright, A. Miller, & M. Kane, Federal Practice and Procedure § 2948 at 129-130 (2nd ed.1995)). When ruling on a motion for a preliminary injunction, "a district court must consider and balance four factors: (1) whether the movant has a strong likelihood of success on the merits; (2) whether the movant would suffer irreparable injury without the injunction; (3) whether issuance of the injunction would cause substantial harm to others; and (4) whether the public interest would be served by issuance of the injunction." Blue Cross & Blue Shield Mut. of Ohio v. Blue Cross & Blue Shield Ass'n, 110 F.3d 318, 322 (6th Cir.1997).

"It is important to recognize that the four considerations applicable to preliminary injunctions are factors to be balanced and not prerequisites that must be satisfied. These factors simply guide the discretion of the court; they are not meant to be rigid and unbending requirements." In re Eagle-Picher Indus., Inc., 963 F.2d 855, 859 (6th Cir.1992). Thus, "the degree of likelihood of success required may depend on the strength of the other factors." In re DeLorean Motor Co., 755 F.2d 1223, 1229 (6th Cir.1985). "In general, the likelihood of success that need be shown (for a preliminary injunction) will vary inversely with the degree of injury the plaintiff will suffer absent an injunction." Friendship Materials, Inc. v. Michigan Brick, Inc., 679 F.2d 100, 105 (6th Cir.1982) (citation omitted).

The Court takes pains to add here that one factor having absolutely nothing to do with whether AFLAC is entitled to the preliminary injunctive relief it seeks is the substantive content of the speech contained in the TaftQuack commercials. The political points made on Hagan's website are, of course, completely irrelevant to the question of whether AFLAC's motion is well-taken. Indeed, AFLAC takes this position itself.⁶

B. Idiosyncracies of this Case.

Before turning to an analysis of the four factors listed above, it is worth noting the factual and legal issues that are not raised in this currently postured. It is partly because of issues not present in this case that it is, apparently, one of first impression.

First, this is not a case where the defendant is using a website address that is easily mistaken for the website address of the plaintiff. That is, Hagan is not using, for example, www.aflac.org as his own web address, thereby "tricking" or detouring users looking for information about AFLAC into reading the information at his own website. Cf. Jews For Jesus v. Brodsky, 993 F.Supp. 282 ...