CMM Cable Rep., Inc. v. Ocean Coast Properties, Inc.

• Decision Date: 01 June 1995
• Docket Number: Civ. No. 94-290-P-H.
• Citation: 888 F. Supp. 192
• Parties: CMM CABLE REP., INC. d/b/a Creative Media Management, Plaintiff, v. OCEAN COAST PROPERTIES, INC. d/b/a WPOR-FM, et al., Defendants.
• Court: U.S. District Court — District of Maine

888 F. Supp. 192

CMM CABLE REP., INC. d/b/a Creative Media Management, Plaintiff, v. OCEAN COAST PROPERTIES, INC. d/b/a WPOR-FM, et al., Defendants.

Civ. No. 94-290-P-H.

United States District Court, D. Maine.

June 1, 1995.

COPYRIGHT MATERIAL OMITTED

Anne S. Mason, Mason & Associates, Clearwater, FL, John H. Rich, III, William J. Sheils, Perkins Thompson Hinckley & Keddy, Portland, ME, for plaintiff.

James G. Goggin, Roy S. McCandless, Verrill & Dana, Portland, ME, for defendants.

AMENDED ORDER ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT AND MOTION TO EXCLUDE PLAINTIFF'S EXPERT

HORNBY, District Judge.

CMM Cable Rep., Inc. ("CMM") has sued Ocean Coast Properties, Inc. (radio station WPOR), several of WPOR's executives, and its graphic design consultant for federal copyright, trademark, and trade dress infringement and certain related state law claims. The defendants, whom I shall refer to collectively as "WPOR,"¹ have moved for summary judgment on all counts.² I now GRANT summary judgment to the defendants on Count II (trademark infringement), Count III (federal unfair competition — trademark infringement), and Counts IV, V, VI, and VII (the state law claims). As for Count I (copy-right infringement), I GRANT summary judgment on all aspects of the claims except for infringement of CMM's "KIX Paycheck Payoff" brochure, as to which summary judgment is DENIED. The motion by WPOR to exclude CMM's expert witness, Creighton Hoffman, is GRANTED IN PART and DENIED IN PART. Since this action is bound to affect all the other pending disputes between the parties, the clerk shall endorse them as "no action necessary" and the lawyers shall notify the court no less than two (2) business days before trial what, if any, additional rulings are necessary.

STATEMENTS OF FACTS³

The facts before me on the summary judgment record, viewed most favorably to CMM, are as follows. CMM develops and markets promotional campaigns for radio stations to increase and preserve listenership. C ¶ 9. CMM markets its promotions to radio stations nationally, using promotional materials and informational brochures that bear copyright and trademark notifications. C ¶ 11. CMM's promotions are only effective if sold to a single radio station in a particular market area; such "market-exclusivity" has been CMM's practice. C ¶ 10. CMM's customers are radio stations, who spend approximately $30,000 to engage CMM's services to run a promotion of the type involved here. DS, PS ¶ 20.

Two of CMM's radio promotions are called "Payroll Payoff' and "Paycheck Payoff." CMM registered these names as service-marks in 1991. C ¶¶ 36-37; DS ¶ 26. The promotions have been marketed to and purchased by numerous radio stations in the United States on a market-exclusive basis. C ¶ 13. Payroll Payoff and Paycheck Payoff radio promotions entice a listener to listen to the station and phone in if her name is selected and read on the air. If she is successful, she will go "on the payroll" at the station and earn an "hourly wage." Listeners enter their names for the contest by returning the reply card on promotional flyers. C ¶ 17. One name is read on the air each hour during certain pre-announced time periods. C ¶ 15. If the named listener does not call within the time limit, the previous successful caller stays "on the payroll" and continues to be paid until replaced by a named listener who does call in time. C ¶ 16. All contestants who successfully go "on the payroll" are eligible for a grand prize drawing at the end of the promotion period. DSS ¶ 4.

CMM owns registered copyrights for its promotional materials, informational brochures, and incorporated artwork and has continuously provided copyright notice on such materials. C ¶ 18. Radio contest promotions like these have certain standard, inherent characteristics, including (1) inviting a potential listener to enter the contest, (2) requiring the contestant to listen to the station to determine the right moment to participate, and (3) requiring the contestant to telephone the station at that time. DS, PS ¶ 3. CMM's principal, Nancy Izor, "borrowed" the idea for these payroll promotions from an earlier radio promotion she heard called "Working Women's Wednesday," in which female listeners called in on Wednesday to be placed on the radio station's "payroll" to earn an "hourly wage." DS, PS ¶ 4. Under CMM's version, the promotion runs all week, includes men and women, and involves supporting "printed collateral" materials. PS ¶ 4.

In the spring of 1994, WPOR began considering an on-air promotional game to bolster its Fall 1994 Arbitron listenership ratings. DS ¶ 5. WPOR contacted CMM in the summer of 1994 to inquire about running one of CMM's payroll promotions. DS ¶ 6. At that time, WPOR had in its possession one of CMM's Paycheck Payoff brochures. DS ¶ 6. Following its practice of market-exclusivity, CMM declined to license a payroll promotion to WPOR because CMM was negotiating a contract to produce promotions for one of WPOR's competitors, WMGX. DS ¶ 6; C ¶ 21. (Use of a payroll promotion by a competitor such as WPOR would make it highly unlikely that WMGX would purchase such a promotion from CMM. C ¶ 21.) CMM informed WPOR of its copyrights and trademarks for its payroll promotions. C ¶ 21.

WPOR was then advised by its independent media consultant that payroll-type radio promotions were not original to nor conceived by CMM, and that CMM did not own a monopoly over such promotions. DS ¶ 6. WPOR decided to run a promotion called "Payday Contest," which was virtually identical to CMM's promotions in its rules and methods of operation. C ¶ 23. WPOR produced a direct mail brochure, newspaper, television, and facsimile advertisements, and on-the-air promotional materials. DS ¶ 7. The defendants James Spizuoco and his firm Graphics North, Inc. designed the Payday Contest brochure. DS ¶ 8. WPOR gave Spizuoco some suggested text copy as well as a CMM Paycheck Payoff brochure from a promotion CMM had produced for a station in Florida (the "KIX brochure"). DS ¶ 8. WPOR instructed Spizuoco "not to make it look like" the KIX brochure. DS ¶ 8. Spizuoco looked at the KIX brochure, but he claims that he then put it away and produced the WPOR brochure from his own ideas. DS ¶ 9. Differences between the two brochures include such things as typestyle, colors, certain layout elements, and the substitution of a time clock (WPOR version) for the cowboy boot and lariat motif (CMM/KIX version). DS, PS ¶ 10. CMM's KIX brochure and the WPOR brochure nevertheless have many striking similarities. PS ¶ 10. Their size (8½" × 14") and folds are almost identical; their layout is the same in the sense that it is horizontal for all but the mailer, which is vertical and appears in a 3" serrated form to the far right; and the participation steps — 1. "FILL OUT," 2. "TUNE IN," and 3. "CALL IN" — are an important textual element. On the first page of both brochures the radio station is identified at the top, the name of the contest comes in the middle, the number of dollars available for prizes comes about three-quarters of the way down, and the last line on the page of each is "JUST FOR LISTENING." In both instances, when the brochure is opened, the top left-hand corner begins "Listen to ..." and then the radio station is identified. At the top right of the open KIX brochure the copy reads "the best in hot new country." Across the top of the WPOR brochure appears "the best in today's hot country and your all time favorites!" At the left side of the open brochure the KIX version states: "Call in, clock in and make $50 an hour!" The WPOR brochure in almost the same position states "Call in ... punch in and you can earn $25 an hour!" Each brochure has an arrow next to that copy with the words inside the arrow: "Here's how." In step 3 of the contest participation process, the KIX brochure states: "Call in, clock in & win!" In step 3, the WPOR brochure states: "Call in, punch in & win!" Under this heading the KIX brochure goes on to state: "When you hear your name, call: (phone number) within 10 minutes and `clock in'!" The WPOR brochure analogue is: "When you hear your name announced on the air, call in and go `on the clock.'" At the lower right in both brochures appears the station identification. In the lower middle in both brochures appears the copy "complete contest rules available at (radio station)." In the return mail portion, the KIX brochure contains a check filling up the lower half of the return mailer; the WPOR brochure replaces the check with a bogus $25 bill located in almost the identical position. (The location of the return address and postal permit are standard and insignificant.)

WPOR's Payday Contest ran from late September through December 14, 1994, during a period known in the radio industry as the fall "sweeps period," when the rating firm Arbitron measures the listenership share of each station in the Portland market. DS, PS ¶ 11. CMM received two phone calls from WPOR's competitors inquiring whether the WPOR Payday Contest was produced by CMM. DS, PS ¶ 24. Despite running the Payday Contest, WPOR's listenership in the fall 1994 sweeps period declined from its previous levels. DS ¶ 12.

PROCEDURAL HISTORY

CMM filed its complaint on October 3, 1994, seeking damages and injunctive relief against the WPOR defendants, claiming infringement of CMM's copyrights, trademarks, and trade dress in violation of federal law, and making similar state law claims. After three days of hearings, I granted a preliminary injunction against WPOR's use of its Payday Contest brochure, but I did not enjoin WPOR from continued use of the Payday Contest itself, its title, the "employment metaphor," the broadcast copy, and the other collateral and advertising materials. CMM Cable Rep., Inc. v. Ocean Coast Properties, Inc., 879 F.Supp. 132 (D.Me.1994). CMM appealed that interlocutory order, but the First Circuit held that the appeal had been...