Lebewohl v. Heart Attack Grill LLC

• Decision Date: 05 July 2012
• Docket Number: No. 11 Civ. 3153 (PAE).,11 Civ. 3153 (PAE).
• Citation: 890 F.Supp.2d 278
• Parties: Jack LEBEWOHL, Jeremy Lebewohl, Uncle Abies Deli Inc. d/b/a Second Ave. Deli, Uncle Abies Deli on First Inc. d/b/a Second Ave. Deli, and Uncle Abies Deli Sandwich Trademarks LLC, Plaintiffs, v. HEART ATTACK GRILL LLC, HAG LLC, Jon Basso, Diet Centers LLC (Texas), and Diet Center LLC (Delaware), Defendants.
• Court: U.S. District Court — Southern District of New York

890 F.Supp.2d 278

Jack LEBEWOHL, Jeremy Lebewohl, Uncle Abies Deli Inc. d/b/a Second Ave. Deli, Uncle Abies Deli on First Inc. d/b/a Second Ave. Deli, and Uncle Abies Deli Sandwich Trademarks LLC, Plaintiffs,

v.HEART ATTACK GRILL LLC, HAG LLC, Jon Basso, Diet Centers LLC (Texas), and Diet Center LLC (Delaware), Defendants.

No. 11 Civ. 3153 (PAE).

United States District Court,

S.D. New York.

July 5, 2012.

William Win-Ning Chuang, Jakubowitz & Chuang, L.L.C., New York, NY, for Plaintiffs.

Darren Spielman, Robert C. Kain, Jr., Kain & Associates, Attorneys at Law, P.A., Michael Joseph Quarequio, Michael J. Quarequio, P.A., Fort Lauderdale, FL, for Defendants.

OPINION & ORDER

PAUL A. ENGELMAYER, District Judge:

The parties to this declaratory judgment action are restaurants that use provocative names to market their extravagantly caloric food. Defendants are a chain of theme restaurants called the Heart Attack Grill and its owners (together, “HAG”). HAG's menu at its one extant restaurant (in Las Vegas, Nevada) offers patrons the Single Bypass Burger, the Double Bypass Burger, the Triple Bypass Burger, and the Quadruple Bypass Burger. HAG has registered trademarks for the restaurant name and the names of its four burgers. Plaintiffs are a New York City kosher delicatessen, the Second Avenue Deli, and its owners (together, “the Deli”). Since 2004, the Deli has offered patrons the Instant Heart Attack Sandwich, and the Deli now proposes to add to its menu an item called the Triple Bypass Sandwich.

The issue before the Court is whether the Deli's current or contemplated uses of the marks Instant Heart Attack Sandwich or Triple Bypass Sandwich violate HAG's rights under the Lanham Act, 15 U.S.C. §§ 1052 et seq. For the reasons that follow, the Court holds that the Deli's current use of the Instant Heart Attack Sandwich mark does not violate HAG's rights; that the Deli may modestly expand its use of that mark, as set forth herein, without giving rise to a likelihood of confusion with HAG's mark; and that the Deli may also lawfully use the Triple Bypass Sandwich mark on a limited basis pursuant to a concurrent use arrangement to which the parties assented at oral argument.

I. Factual Background¹A. The Parties

The Deli is a kosher delicatessen with two locations in Manhattan. It is owned by members of the Lebewohl family, descendants of the restaurant's founder, Abe Lebewohl, who established the Deli in 1954. The plaintiffs are Jack Lebewohl, Jeremy Lebewohl, Uncle Abies Deli Inc. d/b/a Second Ave. Deli, Uncle Abies Deli on First Inc., and Uncle Abies Deli Sandwiches Trademarks LLC. Compl. ¶¶ 22–23.

HAG is a chain of “medically themed” restaurants which first opened in late 2005. HAG Answer ¶ 26. There have been three such restaurants—in Chandler, Arizona; Dallas, Texas; and Las Vegas, Nevada—but only the last remains open. Defendants Heart Attack Grill LLC and HAG LLC are Arizona limited liability companies that ran the Arizona restaurant. Id. ¶¶ 6–7. Defendant Diet Center LLC (Texas) is a Texas limited liability company that ran the Dallas restaurant. Id. ¶ 9. Defendant Diet Center LLC (Delaware) is a Delaware limited liability company that operates the Las Vegas restaurant. HAG Answer ¶ 10. Defendant Jon Basso is the manager-owner of each corporate defendant. HAG Mot. 3.

In a Heart Attack Grill restaurant, provocatively dressed waitresses (called “nurses”) take orders (called “prescriptions”) from customers (called “patients”). HAG Answer ¶ 26. The “patients” are given hospital wristbands which reflect which food they ordered. Id. HAG serves massive, highly caloric hamburgers, fries cooked in lard, and milkshakes. Id. ¶ 27. The menu tracks the theme of the restaurant—it includes the four burgers named above, all-you-can-eat “Flatliner Fries,” and “ButterFat Shakes.” The largest of these burgers is the Quadruple Bypass Burger, which, at 8,000 calories, consists of four half-pound beef patties, eight slices of American cheese, a whole tomato and half an onion served in a bun coated with lard. Customers weighing in at more than 350 pounds are entitled to eat for free. (Dkt. 57 Ex. 10, at 16.) As of this writing, one HAG patron has suffered a heart attack while dining at the Las Vegas restaurant. Basso Decl. ¶ 4.

On June 9, 2005, HAG filed to register its Heart Attack Grill mark with the United States Patent and Trademark Office (“USPTO”). HAG has also registered marks in the names of its four burgers with the USPTO. The Double Bypass Burger registration was filed on June 9, 2005. The Single, Triple, and Quadruple Bypass Burger registrations were filed on December 27, 2005.

B. The Instant Heart Attack Sandwich

The Deli's Instant Heart Attack Sandwich is made from two large potato pancakes (latkes) and filled with the customer's choice of corned beef, pastrami, turkey, or salami. Lebewohl Decl. ¶ 6. Jack Lebewohl attests that he conceived of the idea for this sandwich around 2004, after a conversation with a well-known chef and a New York City Police Department detective. Id.

The Deli does not have any business records that indicate precisely the date when it began serving the Instant Heart Attack Sandwich. Materials adduced at summary judgment, however, indicate that the sandwich was offered starting in 2004, at some point before HAG, in June 2005, applied to register the term Heart Attack Grill. The sandwich was listed on a Deli menu dated “2004–05,” in connection with a Deli location that closed on January 1, 2006. Id. ¶ 8. And, Internet message board posts and articles produced by the Deli reference the Instant Heart Attack Sandwich mark before June 2005, including the following:

• A May 19, 2004 review of the Deli, which appeared on Chowhound.com, an Internet food discussion board, mentions the Instant Heart Attack Sandwich. It describes the sandwich as “flavorful and good.” (Dkt. 57 Ex. 12.)

• A January 13, 2005 review of the Deli on a Chowhound message board post similarly recommended the Deli and the Instant Heart Attack sandwich, by name. (Dkt. 65 Ex. 4.)

• A July 2004 Korean Airlines newsletter mentions the Instant Heart Attack Sandwich. (Dkt. 65 Ex. 3.)

On September 29, 2010, the Deli filed a trademark application with the USPTO to register the Instant Heart Attack Sandwich mark. Deli Mot. 4.

On January 13, 2011, the USPTO preliminarily denied the application in a non-final “Office Action.” The USPTO based that denial on a likelihood of consumer confusion it found between that mark and HAG's Heart Attack Grill mark. (Dkt. 57, Ex. 13.) Citing 15 U.S.C. § 1052(d) of the Lanham Act, the USPTO stated that, “[g]iven the similarity of the marks and the goods and/or services, prospective customers are likely to confuse the source of the respective goods and/or services.” Id.

C. The Triple Bypass Sandwich

To date, the Deli has not offered the Triple Bypass Sandwich. As conceived by the Deli, the Triple Bypass Sandwich, like the Instant Heart Attack Sandwich, would use potato pancakes in lieu of bread or buns; however, the sandwich would include three, not two, layers of pancakes. On September 29, 2010, the same day that it filed its application for the Instant Heart Attack Sandwich mark, the Deli filed an intent-to-use application for the Triple Bypass Sandwich mark. Deli Mot. 4. The Deli represents that, at that time, it was unaware of HAG's Triple Bypass Burger. Lebewohl Decl. ¶¶ 9, 11.

In its January 13, 2011, non-final Office Action, the USPTO found that the Triple Bypass Sandwich mark was sufficiently similar to HAG's Triple Bypass Burger mark—and to HAG's other “bypass” marks—to merit denial of the Deli's application. The USPTO concluded that registering the Triple Bypass Sandwich mark would create a likelihood of confusion. (Dkt. 65 Ex. F.)

D. Procedural History of this Litigation

On March 29, 2011, HAG sent a cease-and-desist letter to the Deli. HAG demanded that the Deli refrain from using the terms Instant Heart Attack Sandwich and Triple Bypass Sandwich, on the grounds that each created a likelihood of confusion with HAG's registered marks. HAG Mot. 9.

On May 10, 2011, the Deli filed this declaratory judgment action. The Deli sought a ruling that neither of its two pending marks infringe any of HAG's marks and that the Deli may therefore register those marks. Alternatively, the Deli sought a ruling that, if the Court were to find a likelihood of confusion between its marks and HAG's, it may use the Instant Heart Attack Sandwich mark (as to which its usage is senior to HAG's registration of the Heart Attack Grill mark) in New York, New Jersey, and Connecticut, to the exclusion of HAG's mark. The Deli also asked that proceedings before the USPTO in connection with its two proposed marks be suspended pending the outcome of this case. (Dkt. 65 Ex. F.)

HAG filed four counterclaims. The first was a dilution claim under the Federal Trademark Dilution Act, alleging that the Deli's use of its proposed marks would dilute the “quality and character” of HAG's marks. (Dkt. 6, pp. 11–14.) On January 5, 2012, the Court dismissed this claim. (Dkt. 41.) HAG also sought declarations that (1) the Deli cannot register its marks; (2) the Deli may not expand its use of the marks; and, alternatively, (3) the parties may use their respective marks under conditions and limitations to be set by the Court.

The parties have engaged in extensive discovery. As to the Deli's claims, both sides have moved for summary judgment. HAG alternatively seeks dismissal, on the grounds that the Deli is not using its marks in interstate commerce, and thus lacks standing to seek relief under the Lanham Act. Both sides also seek legal fees. HAG has also, for the second time, voluntarily moved to dismiss its counterclaims without prejudice.

Oral argument was held on May 22, 2012. At argument, both parties helpfully narrowed the areas in dispute as to both of the Deli's sandwich offerings, facilitating the Court's resolution of this suit....