Cairns v. Franklin Mint Co.

Decision Date16 October 1998
Docket NumberNo. CV 98-3847 RAP (BQRx).,CV 98-3847 RAP (BQRx).
Citation24 F.Supp.2d 1013
CourtU.S. District Court — Central District of California
PartiesLord Simon CAIRNS, et al., Plaintiffs, v. FRANKLIN MINT COMPANY, et al., Defendants.

Mark S. Lee, Cara R. Burns, Shari Mulrooney Wollman, Manatt, Phelps & Phillips, LLP, Los Angeles, CA, for Plaintiffs.

Robert A. Meyer, Douglas E. Mirell, Robert N. Treiman, Daniel J. Friedman, Shanda W. Connolly, Loeb & Loeb LLP, Los Angeles, CA, for Defendants.

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS, OR IN THE ALTERNATIVE TO STRIKE PORTIONS OF, PLAINTIFFS' FIRST AMENDED COMPLAINT; AND ORDER DENYING PLAINTIFFS' MOTION FOR A PRELIMINARY INJUNCTION AGAINST ALL DEFENDANTS

PAEZ, District Judge.

I. Introduction and Factual Allegations1

Diana, Princess of Wales ("Princess Diana") was one of the most beloved, most photographed and most talked about celebrities of the last seventeen years. As a result of her tragic and untimely death, her name has been at the crest of the wave of global popular culture for over a year. Princess Diana's public persona is now the subject of this dispute about the right to use her name and likeness to market goods and services.

This action involves defendants' production and advertisement of jewelry, commemorative plates, sculptures and dolls depicting Princess Diana. Plaintiffs are the executors of the Estate of Diana, Princess of Wales2 (the "Estate") and trustees of the Diana, Princess of Wales Memorial Fund (the "Fund").3 The Fund is a non-profit charitable trust organized under the laws of England and Wales, which, through its U.S. entity, engages in charitable activities in the United States and California. Defendant Roll International Corporation, Inc. ("Roll") is the managing general partner of defendant the Franklin Mint Company. ("Franklin Mint"). Roll allegedly has its principal place of business in Los Angeles, while the Franklin Mint has its principle place of business in Pennsylvania. Defendants Stewart Resnick and Lynda Resnick, who allegedly reside in California, own, control and/or are general partners of Roll and the Franklin Mint.

Princess Diana died on August 31, 1997. Her assets passed by will to her Estate. On September 30, 1997, on behalf of the executors of the Estate, attorney Anthony Robert Julius filed with the State of California a Registration of Claim as Successor-in-Interest pursuant to California Civil Code § 990. In addition, the Estate allegedly filed three applications for federal trademark registrations in various classes for "Diana Princess of Wales" and "Diana Princess of Wales Memorial Fund" with priority dates of September 4, 1997 and September 11, 1997.

The Fund was established on September 4, 1997 to accept donations to be given to various charities with which Princess Diana was associated during her lifetime. Plaintiffs allege that the Fund is, subject to certain reservations, the only charity authorized by the Estate to engage in charitable activities and utilize Princess Diana's name, likeness, image, and marks. Plaintiffs allege that the Estate granted the Fund exclusive licenses, subject to certain reservations, to the name and likeness of Princess Diana and to the trademarks "Diana, Princess of Wales" and "Diana, Princess of Wales Memorial Fund." The Charities Commission for England and Wales allegedly approved those licenses to the Fund, and the parties allegedly completed the licenses on February 27, 1998. Plaintiffs allege that the Fund has used and authorized the use of its trademarks on products and services in the United States.

On or about June 25, 1997, defendant Lynda Resnick purchased a dress sold by Princess Diana at a charity auction. According to plaintiffs, Resnick stated when she bought the dress that she did not intend to commercially exploit it. Plaintiffs allege that on August 8, 1997, however, defendants filed an intent to use trademark application for "Diana, Forever A Princess." On September 4, 1997, defendant Stewart Resnick, on behalf of the other defendants, sought permission to utilize Princess Diana's name and likeness on products and in advertising. In October 1997, plaintiffs refused to authorize defendants' use of Princess Diana's name and likeness. Thereafter, plaintiffs allegedly advised defendants both orally and in writing that any exploitation of Princess Diana's identity by defendants was unauthorized.

On September 4, 1997, defendants allegedly filed trademark applications for "Diana, Queen of Our Hearts," "Diana, Queen of Hearts," "Diana, Angel of Mercy" and "Diana, the People's Princess" for use with jewelry, plates, sculptures and dolls. Likewise, on September 19, 1997, defendants allegedly filed applications for "Design of Diana Wearing Tiara," "Design of Head of Diana Wearing Ribbon," "Design of Princess Diana Wearing Ribbon and Princess Diana" and "Design of Princess Diana Wearing a Tiara and Princess Diana" for use with similar goods. According to plaintiffs, the Patent and Trademark Office Examining Attorney has issued non-final office action letters to defendants rejecting their various trademark applications, in part because the marks falsely suggest a connection with Princess Diana.

Plaintiffs allege that defendants have promoted and sold various items of unauthorized Princess Diana merchandise throughout the United States, including a "Diana, Princess of Wales Porcelain Portrait Doll" featuring a reproduction of the dress bought by Lynda Resnick, a "Diana, Queen of Hearts Jeweled Tribute Ring," a "Diana, England's Rose Diamond Pendant," a "Princess Diana Tiara Ring," an "England's Rose Heirloom Collector Plate," a "Diana, The People's Princess Doll," a "Princess Diana Crown Ring" and the "Diana, Forever Sparkling Classic Drop Earrings." Defendants' products and advertising feature Princess Diana's name and likeness.

Plaintiffs allege that defendants are using their advertising to improperly benefit from the goodwill associated with Princess Diana's identity. According to plaintiffs, defendants attempt to conceal their efforts to benefit from Princess Diana's death by falsely and misleadingly implying an endorsement, association or affiliation with Princess Diana, her Estate and the Fund. Defendants allegedly do this through (a) their use of Diana's name and likeness; (b) their characterization of their products as a way to "honor" or "commemorate" Diana; (c) their references to Diana's charitable activities; (d) their offer of a "certificate of authenticity" with their merchandise; and (e) their statement that "100% of the ... price [of the products] will be donated to Diana, Princess of Wales' charities."

Plaintiffs assert claims against all defendants for (1) false designation of origin and false endorsement under the Lanham Act; (2) federal trademark dilution in violation of 15 U.S.C. § 1125(c); (3) infringement of California's statutory right of publicity, California Civil Code § 990; (4) false advertising under the Lanham Act; and (5) unfair competition and false and misleading advertising in violation of California Business and Professions Code §§ 17200 and 17500, et seq.

Pending before the Court are (1) Defendants' Request for Judicial Notice in Connection with Defendants' Motion to Dismiss Plaintiffs' Complaint; (2) a Motion by Defendants Franklin Mint Company, Roll International Corporation, Inc., Stewart Resnick and Lynda Resnick to Dismiss, or in the Alternative to Strike Portions of, Plaintiffs' First Amended Complaint; (3) Plaintiffs' Motion for Preliminary Injunction; and (4) Defendants' Objections to and Motion to Strike Declarations Submitted by Plaintiffs in Support of Motion for Preliminary Injunction.

Upon consideration of the papers submitted by the parties' in conjunction with each motion, and the oral arguments of counsel, defendants' request for judicial notice of a complaint in a Delaware declaratory relief action by defendants' competitor against the Fund is DENIED as the evidence proffered is not relevant to the questions before the Court.

Defendants' Motion to Dismiss or Strike is GRANTED IN PART AND DENIED IN PART. The motion to dismiss plaintiffs' Third Claim for relief under Civil Code § 990 is GRANTED because choice of law principles dictate application of the law of Great Britain. Defendants' motion to dismiss plaintiffs' First Claim for relief for false endorsement and false origin is DENIED because likelihood of confusion is a question of fact. Defendants' motion to dismiss plaintiffs' Second Claim for relief is DENIED because plaintiffs sufficiently allege that their mark had acquired secondary meaning as a source of the charitable activities of Diana, Princess of Wales. Defendants' motion to dismiss plaintiffs' Fourth and Fifth Claims for relief for false advertising under the Lanham Act and under California law, respectively is DENIED.

Defendants' motion to strike language in the complaint referring to defendants as "vultures feeding on the dead" is GRANTED. The motion to strike plaintiffs' claim for damages under § 990 is moot.

Finally, plaintiffs' motion for a preliminary injunction is DENIED because plaintiffs have failed to establish a likelihood of success on the merits with respect to their false origin and false endorsement, trademark dilution, and false advertising claims.

II. Discussion
A. Motion to Dismiss
1. Standard

A motion to dismiss under Fed. R.Civ.P. 12(b)(6) tests the legal sufficiency of the claims asserted in the complaint. Accordingly, the scope of review on a motion to dismiss for failure to state a claim is limited to the contents of the complaint. Clegg v. Cult Awareness Network, 18 F.3d 752, 754 (9th Cir.1994). The court may, however, consider exhibits submitted with the complaint and matters that may be judicially...

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