Fuente Cigar, Ltd. v. Opus One, 96-2389-CIV-T-24 (E).

• Decision Date: 05 November 1997
• Docket Number: No. 97-346-CIV-T-24 (E).,No. 96-2389-CIV-T-24 (E).,96-2389-CIV-T-24 (E).,97-346-CIV-T-24 (E).
• Citation: 985 F.Supp. 1448
• Parties: FUENTE CIGAR, LTD., a foreign corporation, Plaintiff, v. OPUS ONE, a California general partnership, Defendant. OPUS ONE, a California general partnership, Plaintiff, v. FUENTE CIGAR, LTD., a foreign corporation, and Fuente & Newman Premium Cigars Limited, Inc., a Florida corporation, Defendants.
• Court: U.S. District Court — Middle District of Florida

Page 1448

985 F.Supp. 1448

FUENTE CIGAR, LTD., a foreign corporation, Plaintiff, v. OPUS ONE, a California general partnership, Defendant.

OPUS ONE, a California general partnership, Plaintiff, v. FUENTE CIGAR, LTD., a foreign corporation, and Fuente & Newman Premium Cigars Limited, Inc., a Florida corporation, Defendants.

No. 96-2389-CIV-T-24 (E).

No. 97-346-CIV-T-24 (E).

United States District Court, M.D. Florida, Tampa Division.

November 5, 1997.

William C. Guerrant, Jr., Hill, Ward & Henderson, P.A., Tampa, FL, R. Dennis Claessens, Robert M. Ward, Patricia A. Kane, Joseph P. Regan, Hill, Steadman & Simpson, P.C., Chicago, IL, for Fuente Cigar, Ltd., Fuente & Newman Premium Cigars Limited Inc.

C. Douglas McDonald, Jr., Pettis & McDonald, PA, Tampa, FL, John K. Uilkema, Limbach & Limbach L.L.P., San Francisco, CA, John L. Cooper, James W. Morando, Farella Braun & Martel LLP, San Francisco, CA, for Opus One.

William C. Guerrant, Jr., Hill, Ward & Henderson, P.A., Tampa, FL, R. Dennis Claessens, Robert M. Ward, Hill, Steadman & Simpson, P.C., Chicago, IL, for William M. Sharp, Sharp, Smith & Harrison, P.A., Kalish & Ward, Thomas P. McNamara.

ORDER

BUCKLEW, District Judge.

This cause comes before the Court on Plaintiff/Counter-Defendant Fuente Cigar Ltd.'s Motion to Amend (Doc. No. 25, filed May 2, 1997) and Defendant/Counter-Plaintiff Opus One's Motion to Amend (Doc. No. 34, filed June 17, 1997). On May 15, 1997, Opus One filed a response in opposition to Fuente Cigar Ltd.'s Motion to Amend (Doc. No. 28); and on June 30, 1997, Fuente Cigar Ltd. and Fuente & Newman Premium Cigars Ltd. filed a response in opposition to Opus One's Motion to Amend (Doc. No. 39). Concluding that both responses were essentially motions to dismiss, this Court granted each party leave to file a reply to its opponent's response, (Doc. No. 42, filed July 8, 1997), and both Fuente Cigar Ltd. and Opus One did so — Fuente Cigar Ltd. on July 28, 1997 (Doc. No. 56), and Opus One also on July 28, 1997 (Doc. No. 53). In the interim, Opus One also moved to amend to add a specific prayer for damages (Doc. No. 48), a motion that Fuente Cigar Ltd. and Fuente & Newman Premium Cigars Ltd. opposed (Doc. No. 63, filed Aug. 4, 1997).

I. BACKGROUND

Fuente Cigar Ltd. is a manufacturer of "premium," handmade cigars, whose principal place of business is the Dominican Republic. Fuente & Newman Premium Cigars Ltd., a Florida corporation, is its distributor. (Hereinafter, the Court shall refer to the two collectively as "Fuente.") In 1991 and 1992, Fuente developed a new cigar that it initially called "FUENTE FUENTE OPUS X." This mark was registered with the United States Patent and Trademark Office on July 23, 1996. (Doc. No. 25, ex. A.) According to Fuente, the mark has subsequently evolved into "FUENTE FUENTE OPUSX." (Doc. No. 25, ex. B.) It is disputed whether the "X" in "OPUSX" is properly (or commonly) understood to designate the Roman numeral or the alphabetical character.

Opus One is a California general partnership that produces a "premium" red wine whose mark is "OPUS ONE." (Doc. No. 39, ex. A.) In 1995, Opus One acquired the rights to use the mark "OPUS ONE" with regards to tobacco products from a German company that was selling pipe tobacco under that name. (Doc. No. 25, ex. E.) On June 2, 1995, Opus One filed an application with the United States Patent and Trademark Office to use the "OPUS ONE" mark as to tobacco products. (Doc. No. 39, Ex. A.) Currently, Opus One does not produce, distribute or license its name for use with any cigar, but the company has negotiated with another manufacturer of premium cigars to create an "OPUS ONE" cigar. (Doc. No. 25, ex. E.) Opus One alleges that this venture has been halted out of concerns about confusion between an "OPUS ONE" cigar and Fuente's "OPUSX." (Doc. No. 49, Ex. A.)

On October 2, 1996, Opus One initiated a trademark infringement action against Fuente in the United States District Court for the Northern District of California. Fuente subsequently filed a declaratory judgment action in this Court. The two actions were combined when the California action was transferred to this District.

In the very early stages of litigation, some time around November of 1996, a representative of Opus One was interviewed for an article in Cigar Insider, a trade publication of the cigar industry. In the article, the Opus One representative stated that "[i]n our view, [the term "OPUS"] is clearly being used on [Fuente's] cigars to trade on our reputation," and that Fuente had "effectively appropriated" Opus One's mark. (Doc. No. 25, ex. E.) Referring to the cigar as "Opus Ten," the Opus One representative stated that Fuente could call its cigar what it liked, "but don't call it Opus or Opus One." Id.

II. DISCUSSION

Opus One has now moved to Amend its complaint to add a count for dilution under the Lanham Act, § 1125(c). In addition, Opus One has moved to amend to add a specific prayer for money damages with respect to its trademark infringement claims under the Lanham Act, 15 U.S.C. § 1117(a).

In situations in which a responsive pleading has been served, Rule 15(a) of the Federal Rules of Civil Procedure provides that a party may amend its pleading by written consent of the adverse party or by leave of the Court. In the instant action, because both Fuente and Opus One have explicitly withheld their consent to their opponents' proposed amendments, the question is whether the Court should grant leave to amend. Rule 15(a) advises that such leave "shall be freely given when justice so requires." The Supreme Court has stated that "this mandate is to be heeded":

In the absence of any apparent or declared reason — such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of the amendment, futility of the amendment, etc. — the leave sought should, as the rules require, be "freely given."

Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 230, 9 L.Ed.2d 222 (1962).

Nonetheless, it is well settled that "there is no obligation to allow amendment if to do so would be futile." Laborers Local 938 Joint Health & Welfare Trust Fund v. B.R. Starnes Co., 827 F.2d 1454, 1456 n. 1 (11th Cir.1987) (citing Foman, 371 U.S. at 182, 83 S.Ct. at 230). An amendment is futile if the cause of action asserted therein could not withstand a motion to dismiss. Florida Power & Light Co. v. Allis Chalmers Corp., 85 F.3d 1514, 1520 (11th Cir.1996); Halliburton & Assocs., Inc. v. Henderson, Few & Co., 774 F.2d 441, 444 (11th Cir.1985). That is, a court may deny leave to amend when it appears beyond doubt that the proponent can prove no set of facts to support the proposed amendment. See Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-102, 2 L.Ed.2d 80 (1957).

A. Opus One's Proposed Amendments.

Opus One has moved to amend to add a specific prayer for money damages with respect to its trademark infringement claims under the Lanham Act, 15 U.S.C. § 1117(a). Opus One has also moved to amend its complaint to add a count for dilution under the Lanham Act, § 1125(c).

1. The Specific Prayer for Damages.

Opus One seeks this Court's leave to amend its complaint to add a specific prayer for money damages with respect to its trademark infringement claims under the Lanham Act, 15 U.S.C. § 1117(a). Fuente argues that the amendment is untimely and would complicate discovery, prejudicing both itself and the Court's interest in judicial efficiency. Opus One is not proposing a new theory of recovery, however. Moreover, in its original complaint, Opus One provided for "such other relief as this Court shall deem just." The Court concludes that this language is sufficiently broad and affords sufficient notice, and that the proposed amendment is sufficiently modest, to negate the probability of undue delay, bad faith or dilatory motive on the part of the Opus One, or undue prejudice to Fuente. See Foman, 371 U.S. at 182, 83 S.Ct. at 230. Moreover, the question of the proposed amendment's futility is one of fact, not of law. However unlikely, it is not inconceivable that Opus One may produce evidence tending to show that it has "been damaged by actual consumer confusion or deception" as a result of Fuente's alleged infringement. See Brunswick Corp. v. Spinit Reel Co., 832 F.2d 513, 525 (10th Cir.1987). Thus, the proposed amendment is not inappropriate, and it comports with justice to allow it. See Fed.R.Civ.P. 15(a).

2. The Anti-Dilution Claim.

Opus One's proposed anti-dilution claim is pursuant to 15 U.S.C. § 1125(c)(1), which provides: "The owner of a famous mark shall be entitled, subject to the principles of equity and upon such terms as the court deems reasonable, to an injunction against another person's commercial use in commerce of a mark or trade name, if such begins after the mark has become famous and causes dilution of the distinctive quality of the mark, and to obtain such other relief as is provided in this subsection." 15 U.S.C. § 1125(c)(1). While section 1125(c)(2) allows for damages subject to a showing of willful intent "to trade on the owner's reputation or to cause dilution of the mark," Opus One has explicitly limited its remedy to an injunction against further "dilution" of the mark in question, as opposed to damages for wrongful dilution in the past. (Doc. No. 35, ex. A.)

Section 1125(c) was adopted as an amendment to the Lanham Act on June 16, 1996. Fuente argues that, since it adopted the mark at issue prior to that date, and the conduct of which Opus One is complaining also occurred prior to that date, a section 1125(c) claim in this action would be tantamount to a retroactive application of the statute. Opus One counters that, because it seeks only prospective relief under the antidilution statute, the issue of retroactivity is not properly at play.

Unlike the constitutional...