Emerald City Mgmt., LLC v. Jordan Kahn & Jordan Kahn Music Comp., LLC
| Decision Date | 08 January 2016 |
| Docket Number | CIVIL ACTION No. 4:14-cv-358 |
| Parties | EMERALD CITY MGMT., LLC, and EMERALD CITY BAND, INC. Plaintiffs, v. JORDAN KAHN and JORDAN KAHN MUSIC COMP., LLC, Defendants. JORDAN KAHN Third-Party Plaintiff/Counter-Plaintiff v. DEAN "DENO" TAGLIOLI, EMERALD CITY BAND, INC., AND EMERALD CITY MGMT., LLC Third-Party Defendant And Counter-Defendants |
| Court | U.S. District Court — Eastern District of Texas |
MEMORANDUM OPINION AND ORDER
Pending before the Court are Emerald City Band, Inc. ("EC Band Inc."), Emerald City Management, LLC ("EC Management LLC") (collectively "Emerald City"), and Dean Taglioli ("Taglioli") Motion for Summary Judgment (Dkt. #116), and Jordan Kahn ("Kahn"), and Jordan Kahn Music Comp., LLC ("JKMC") (collectively "Kahn & Co.") Motion for Summary Judgment (Dkt. #118). After reviewing the relevant pleadings, the Court finds that the motions should be granted in part and denied in part.
Dean Taglioli is the sole member of EC Management LLC and the president of EC Band Inc. (Dkt. #127-3 at p. 1). According to Emerald City, EC Band Inc. operates one cover band (Emerald City Band) and EC Management LLC operates three cover bands (Limelight, Party Makers, and Downtown Fever) (Dkt. #127-3 at p. 2). These cover bands provide entertainment at special events and parties.
In 2007, while a student at Berklee College of Music in Boston, Jordan Kahn established a band that he called "Downtown Fever," which allegedly developed a strong following in the Boston area (Dkt. #88 at ¶¶ 8-10). In 2008, Taglioli invited Downtown Fever to play during the break of an Emerald City performance at a Dallas club called Cape Buffalo (Dkt. #88 at ¶ 13; Dkt. #116-2 at 18:18-19:13). This was the only time that Kahn's band Downtown Fever played in Texas prior to August 2009 (Dkt. #116-2 at 16:19-17:8).
Musician Jordan Kahn first began playing with Emerald City Band in 2004 and 2005, when he was living in Plano, Texas (Dkt. #88, at ¶ 10). In 2009, Taglioli invited Kahn to leave Boston and affiliate with Emerald City. Kahn began working with Taglioli in September 2009, and continued to lead Downtown Fever as part of his employment (Dkt. #88 at ¶ 14). Kahn alleges that in September 2009, he gave Emerald City a license to use the mark DOWNTOWN FEVER (Dkt. #88 at ¶ 41). Kahn's first performance with the Dallas-based Downtown Fever band was on October 10, 2009 (Dkt. #129-1 at 54:5-18). In 2011, Emerald City applied for a Texas trademark for DOWNTOWN FEVER (Dkt. #127-3 at p. 8). In doing so, it claimed that the first use of the DOWNTOWN FEVER mark was in 2005 (Dkt. #127-3 at p. 8).
The relationship between Taglioli and Kahn soured, and Kahn resigned on May 28, 2014 (Dkt. #81 at ¶ 17). Emerald City later filed the present lawsuit, in which the parties are nowsuing one another for trademark infringement, unfair competition, misappropriation of trade secrets, and several other causes of action.
According to Emerald City, Kahn engaged in the following behavior after he left the company:
Kahn claims that he was the original owner of the DOWNTOWN FEVER mark and the first to use the mark in commerce (Dkt. #88 at ¶¶ 8, 20). He also claims that he was the first to pay for and develop a Downtown Fever website (Dkt. #88 at ¶ 10). In addition to counterclaims alleging infringement and misappropriation of intellectual property, Kahn is also suing for fraud and misrepresentation, based on Taglioli's failure to provide the allegedly-promised 30% equity interest in EC Management LLC.
Emerald City is asserting the following claims: (1) trademark infringement, (2) false advertising/unfair competition, (3) dilution, (4) cybersquatting, (5) copyright infringement, (6) tortious interference (with existing contracts and prospective business relations), (7) misappropriation of trade secrets, (8) breach of fiduciary duty, (9) conversion/civil theft, (10) conspiracy, and (11) attorney's fees. Kahn is asserting the following claims against Taglioli and Emerald City: (1) trademark infringement, (2) unfair competition, (3) breach of licensing agreement, (4) fraudulent registration with the Texas Secretary of State, (5)misrepresentation/fraud, (6) unjust enrichment, (7) promissory estoppel, (8) misappropriation of trade secrets, and (9) declaratory relief.
On August 21, 2015, Taglioli and Emerald City filed Counter-Defendants' and Third-Party Defendant's Motion for Partial Summary Judgment (Dkt. #116). On September 10, 2015, Kahn & Co. filed Defendants' Response to Counter-Defendants and Third-Party Defendant's Motion for Summary Judgment (Dkt. #129). On September 21, 2015, Taglioli and Emerald City filed Reply to Defendants' Response to Counter-Defendants and Third-Party Defendant's Motion for Partial Summary Judgment (Dkt. #130).
On August 21, 2015, Kahn & Co. filed Defendants' Motion for Summary Judgment (Dkt. #118). On September 10, 2015, Taglioli and Emerald City filed Plaintiff's Response to Defendants' Motion for Summary Judgment (Dkt. #127). On September 21, 2015, Kahn & Co. filed Defendants' Reply in Support of Their Motion for Summary Judgment (Dkt. #132). On October 1, 2015, Taglioli and Emerald City filed Counter-Plaintiff's Sur-Reply in Opposition to Counter-Defendants and Third-Party Defendant's Motion for Summary Judgment (Dkt. # 134).
The purpose of summary judgment is to isolate and dispose of factually unsupported claims or defenses. See Celotex Corp. v. Catrett, 477 U.S. 317, 327 (1986). Summary judgment is proper if the pleadings, the discovery and disclosure materials on file, and any affidavits "[show] that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(a). A dispute about a material fact is genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The trial court must resolve all reasonable doubts in favor of the party opposing the motion for summary judgment. CaseyEnters., Inc. v. Am. Hardware Mut. Ins. Co., 655 F.2d 598, 602 (5th Cir. 1981) (citations omitted). The substantive law identifies which facts are material. Anderson, 477 U.S. at 248.
The party moving for summary judgment has the burden to show that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. Id. at 247. If the movant bears the burden of proof on a claim or defense on which it is moving for summary judgment, it must come forward with evidence that establishes "beyond peradventure all of the essential elements of the claim or defense." Fontenot v. Upjohn Co., 780 F.2d 1190, 1194 (5th Cir. 1986). Where the nonmovant bears the burden of proof, the movant may discharge its burden by showing that there is an absence of evidence to support the nonmovant's case. Celotex, 477 U.S. at 325; Byers v. Dallas Morning News, Inc., 209 F.3d 419, 424 (5th Cir. 2000). Once the movant has carried its burden, the nonmovant must "respond to the motion for summary judgment by setting forth particular facts indicating there is a genuine issue for trial." Byers, 209 F.3d at 424 (citing Anderson, 477 U.S. at 248-49). The nonmovant must adduce affirmative evidence. Anderson, 477 U.S. at 257. No "mere denial of material facts nor...unsworn allegations [nor] arguments and assertions in briefs or legal memoranda" will suffice to carry this burden. Moayedi v. Compaq Computer Corp., 98 F. App'x 335, 338 (5th Cir. 2004). Rather, the Court requires "significant probative evidence" from the nonmovant in order to dismiss a request for summary judgment supported appropriately by the movant. United States v. Lawrence, 276 F.3d 193, 197 (5th Cir. 2001). The Court must consider all of the evidence, but must refrain from making any credibility determinations or weighing the evidence. See Turner v. Baylor Richardson Med. Ctr., 476 F.3d 337, 343 (5th Cir. 2007).
"The Texas common law elements of unfair competition, including trademark, 'are no different than those under federal trademark law.'" Condom Sense, Inc., 390 S.W.3d at 738 (Tex. App.—Dallas 2012, no pet.) (quoting All Am. Builders, Inc. v. All Am. Siding of Dallas, Inc., 991 S.W.2d 484, 488 (Tex. App.—Fort Worth 1999, no pet.)). Because of this, Texas courts "look to the Lanham Act and cases thereunder for generally accepted principles of substantive trademark law and to discern meaning and interpretation of the state law provisions." Condom Sense, 390 S.W.3d at 738 (citing KLN Steel Prods. Co. v. CNA Ins. Cos., 278 S.W.3d 429, 440-41 (Tex. App.—San Antonio 2008, pet. denied). To establish trademark infringement and unfair competition, the plaintiff must show ownership in a legally protectable mark and demonstrate a likelihood of confusion. Smack Apparel, 550 F.3d at 474.
"At common law, trademark ownership is acquired by actual use of the mark in a given market." Emergency One, Inc. v. Am. Fire Eagle Engine Co., Inc., 332 F.3d 264, 267 (4th Cir. 2003). Such use must be uninterrupted and continuing. Quiksilver, Inc. v. Kymsta Corp., 466 F.3d 749, 762 (9th Cir. 2006); see Blue Bell, Inc. v. Farah Mfg. Co., Inc., 508 F.2d 1260, 1265 (5th Cir. 1975) (...
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