Dunfey Hotels Corp. v. Meridien Hotels Investments, 80 Civ. 4751 (JMC).
| Decision Date | 05 December 1980 |
| Docket Number | No. 80 Civ. 4751 (JMC).,80 Civ. 4751 (JMC). |
| Citation | 504 F. Supp. 371 |
| Parties | DUNFEY HOTELS CORPORATION, Plaintiff, v. MERIDIEN HOTELS INVESTMENTS GROUP, INC., d/b/a Hotel Parker Meridien, Parlieb, Inc., Jack Parker individually and Meridien Hotels, Inc., Defendants. |
| Court | U.S. District Court — Southern District of New York |
COPYRIGHT MATERIAL OMITTED
Kane, Dalsimer, Kane, Sullivan & Kurucz, New York City (David H. T. Kane, Siegrun Kane, Virginia Richard, New York City, of counsel), for plaintiff.
Stoll & Stoll, New York City (Robert S. Stoll, Harold R. Liebman and Doris S. Hoffman, New York City, of counsel), for defendants.
After consolidating the hearing of plaintiff's application for a preliminary injunction with a trial on the merits pursuant to Fed.R.Civ.P. 65(a)(2), on plaintiff's amended complaint, the Court finds for defendants, and the amended complaint is dismissed.
On defendants' counterclaims, the Court finds that defendants are entitled to a Judgment declaring that their use of the service mark, "Hotel Parker Meridien New York," and its abbreviation "Parker Meridien," in connection with hotel services does not infringe upon plaintiff's rights in its registered service mark, "Parker House." In addition, defendants are entitled to a Judgment declaring that their use of the names "Parker" and "Parker House" in connection with apartment services does not infringe upon plaintiff's rights in its mark. In all other respects, the defendants have failed to prove their counterclaims, and they are dismissed.
The present action has been precipitated by the impending entry of the latest competitor in Manhattan's flourishing luxury hotel market — the Hotel Parker Meridien New York.1 This new forty-story hotel, sometimes called the "Parker Meridien," is scheduled to open on West 56th Street in January 1981. Plaintiff, Dunfey Hotels Corp. "Dunfey", a Delaware corporation with its principle place of business in New Hampshire,2 owns the well-known Parker House Hotel in Boston, Massachusetts, and the registered service mark "Parker House" as applied to hotel services. In this action, Dunfey seeks to enjoin permanently the owners and operators of the Hotel Parker Meridien New York from using the word "Parker" in any service mark or in any other manner in connection with hotel services since such use will allegedly cause the public to believe that defendants' hotel is in some way related to Dunfey's hotel. Jurisdiction is based on the Lanham Act, 15 U.S.C. § 1051, et seq., and the Judicial Code, 28 U.S.C. § 1338.3
Dunfey owns a hotel chain of approximately twenty-two hotels and motels in the United States and Europe, most of which are moderately-priced.4 Three hotels, however, are advertised as luxury "Dunfey Classic Hotels." Transcript of Proceedings, Dunfey Corp. v. Meridien Hotels, Inc., 80 Civ. 4751 (JMC) at 165-66 hereinafter cited as "Tr.". These include the Parker House, the flagship hotel of the Dunfey chain, the Berkshire Place in New York City and the Ambassador East in Chicago. Dunfey acquired the Parker House, one of America's oldest continuously-operated hotels,5 in December 1968 when the hotel was on the verge of bankruptcy. At that time, through a series of assignments, Dunfey also acquired the rights to United States Service Mark Registration No. 819,282 for the mark "Parker House" as applied to hotel services. This mark was registered on November 22, 1966. See Tr. at 140-42; PX 33.
Dunfey spent nearly $8,000,000 to restore the Parker House so that the hotel has now regained its reputation6 as one of the country's leading luxury hotels.7 Dunfey presently spends in excess of $500,000 annually to promote and advertise the Parker House,8see Tr. at 185-86, and twenty-five percent of this promotional activity is directed to the New York market. Tr. at 147. In most of these advertisements, the Parker House service mark is followed closely by the subtitle "A Dunfey Classic Hotel." See, e. g., PX 37. Similarly, one marquee outside of the Parker House contains the legend "Parker House — A Dunfey Classic Hotel." See DX U.
The defendants in this action are Jack Parker, Parlieb, Inc. "Parlieb", a New York corporation owned by Jack Parker, and Meridien Hotels, Inc. "Meridien", a subsidiary of Air France.9 Parlieb is the owner and operator of the Hotel Parker Meridien New York.
Jack Parker has been an active participant in the construction and apartment industry for the past thirty years. In 1950, he built an apartment complex in Queens named "The Parker House," and has since constructed and operated several other apartment complexes in New York, New Jersey and Florida. Many of Parker's apartment complexes have been named after him in a similar manner.10 The Parker Meridien, now under construction by the Jack Parker Construction Corp.,11 see Tr. at 245, 257, is Parker's first solo venture in the luxury hotel market.12 He has invested $60 million in the hotel and, when completed, it will contain approximately 597 hotel rooms, 100 apartments, and various recreation facilities. Tr. at 209.13
On January 15, 1980, Parlieb entered into a twenty-year management agreement with Meridien, which operates approximately thirty-five other hotels around the world, see PX 40, to manage the Parker Meridien, see PX 39.14 This agreement provides that Meridien has the sole and exclusive right to manage the hotel as a "first-class hotel comparable to the Park Lane or Regency Hotels," see PX 39 at 9, and that the hotel will be known as the "Parker Meridien New York,"15 id. at 13. Neither Meridien nor any other subsidiary of Air France has an investment interest in the Parker Meridien.
Kevin Buckley, the partner in charge of account management and marketing at the David Deutsch Associates Agency the "Deutsch Agency", testified that his advertising agency has been retained to advertise the Parker Meridien. He stated that, as of September 22, 1980, only one Parker Meridien advertisement directed to the general public has been published. That advertisement ran in the September 1980 issue of Town and Country Magazine on page 220. PX 17. The design of the advertisement is reminiscent of the French flag and contains the approved logo for the hotel—"Hotel Parker Meridien New York" next to the stylized Meridien "M" trademark — arranged with the words "Hotel Parker" on the top line in 1/8 -inch lettering, "Meridien" on the middle line in lettering that is twice as large, and "New York" on the bottom line again in 1/8 -lettering. Buckley further testified that the word "Parker" can be used in advertisements only in the context of the approved logo, and that the same proportionate size of words will be maintained whenever the logo is used. Tr. at 45. The advertisement reads:
THE HOTEL IMPORTED FROM FRANCE. There's an elegant new hotel in New York. Just down the street from Carnegie Hall. A stone's throw from Van Cleef & Arpels. A hotel that offers you exquisitely furnished rooms and suites; resident executive apartments; a dazzling health club with racquetball and squash courts; a sparkling rooftop pool; and a French management dedicated to the proposition that all luxury hotels are not created equal. Introducing the Hotel Parker Meridien at 118 W. 57th Street, N.Y., N.Y. 10019 .... There are over thirty-five Meridien Hotels around the world, including the Hotel Meridien Houston, and the new Hotel Meridien opening soon in Boston....
PX 17. There is no doubt that the Parker Meridien's advertising campaign is aimed at the same high-income, highly educated audience that is the target of the Dunfey advertising campaign. See Tr. at 54-55. Indeed, the Deutsch agency currently plans to run the Parker Meridien advertisements in many of the same publications in which Dunfey advertisements appear. Tr. at 31.
The Parker Meridien has also published advertisements in two trade publications, The Hotel and Travel Index, see PX 16, and the American Society of Travel Agents, October Issue, see PX 22. These two advertisements, as well as the many proposed advertisements that were introduced into evidence at trial,16 see PX 18-21; DX A-T, stress the hotel's French atmosphere and ambiance. Tr. at 63. All of these advertisements must be approved by both Jack Parker and Meridien, although the Deutsch Agency is compensated by Meridien. Tr. at 57.
In addition to the advertising campaign, Meridien is responsible for generating as much publicity as possible for the new hotel in the news media.17 Both Meridien and the Parker companies are also soliciting rentals for the 100 residential hotel apartments. Jacquelyn Sonenberg, the National Sales Director for these apartments, testified that the Parker Meridien sent solicitation letters and brochures to twenty-five thousand corporations around the world regarding the rentals. See PX 44, DX AJ.
After plaintiff became aware of the impending opening of the Parker Meridien, its general counsel notified Jack Parker, by letter dated April 24, 1980, that he considered Parker's use of the name Parker Meridien New York to be an infringement, noting that "should you use `Parker Meridien New York' for the name of your new hotel in New York, people will inevitably associate that hotel with the Parker House in Boston to our mutual disadvantage." PX 45. Plaintiff then commenced this action on August 18, 1980.
Plaintiff claims that defendants' use of the service mark "Parker Meridien" infringes plaintiff's registered service mark "Parker House" in violation of 15 U.S.C. § 1114, and constitutes a false designation of origin in violation of 15 U.S.C. § 1125(a). The defendants assert several affirmative defenses18 and counterclaims for declaratory relief. In particular, the defendants seek a declaration that (1) their use of the mark Parker Meridien does not infringe upon plaintiff's mark; (2) that no person or company, including plaintiff, has exclusive rights to use...
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