Major League Baseball v. Sed Non Olet Denarius

• Decision Date: 06 April 1993
• Docket Number: No. 90 CIV 2170 (CBM).,90 CIV 2170 (CBM).
• Citation: 817 F. Supp. 1103
• Parties: MAJOR LEAGUE BASEBALL PROPERTIES, INC. and Los Angeles Dodgers, Inc., Plaintiffs, v. SED NON OLET DENARIUS, LTD., d/b/a The Brooklyn Dodger Sports Bar & Restaurant, Bums, Inc., d/b/a The Brooklyn Dodger, David Senatore, Richard Picardi and Kevin Boyle, Defendants.
• Court: U.S. District Court — Southern District of New York

817 F. Supp. 1103

MAJOR LEAGUE BASEBALL PROPERTIES, INC. and Los Angeles Dodgers, Inc., Plaintiffs, v. SED NON OLET DENARIUS, LTD., d/b/a The Brooklyn Dodger Sports Bar & Restaurant, Bums, Inc., d/b/a The Brooklyn Dodger, David Senatore, Richard Picardi and Kevin Boyle, Defendants.

No. 90 CIV 2170 (CBM).

United States District Court, S.D. New York.

April 6, 1993.

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Willkie Farr & Gallagher, New York City by Robert J. Kheel, William J. Borner, Stacey E. Blumberg, for plaintiffs.

Ronald G. Russo, Fischetti & Russo, New York City (John M. Keene and H. John Campaign, Graham, Campaign & McCarthy, P.C., New York City, of counsel), for defendants.

OPINION

MOTLEY, District Judge.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

I. INTRODUCTION

Plaintiffs, Major League Baseball Properties, Inc. ("Properties") and Los Angeles Dodgers, Inc. ("Los Angeles"), allege in their Amended Complaint¹ that the conduct of the three corporate defendants, Sed Non Olet Denarius, Ltd., d/b/a The Brooklyn Dodger Sports Bar and Restaurant ("SNOD"), BUMS, Inc., d/b/a The Brooklyn Dodger Sports Bar and Restaurant ("BUMS"), and 9506, Inc., d/b/a The Brooklyn Dodger ("9506") (hereinafter collectively "The Brooklyn Dodger"), and the conduct of the three individual defendants, David Senatore, Richard Picardi and Kevin Boyle, constitute: a) an infringement upon the rights of plaintiffs' trademarks in violation of 15 U.S.C. §§ 1114 and 1117; b) a wrongful appropriation of plaintiffs' trademarks in violation of 15 U.S.C. § 1125 c) a violation of plaintiffs' common law trademark and property rights; d) a violation of plaintiffs' rights under the New York General Business Law § 368-d; e) unfair competition; and f) the intentional use by defendants of a counterfeit mark in violation of 15 U.S.C. § 1117(b).

Each of these six causes of action is alleged to flow from defendants' use of the words "The Brooklyn Dodger" as the name and servicemark of the restaurants which defendants have operated in Brooklyn, New York, beginning in March 1988. Plaintiffs initially sought permanent injunctive relief, an accounting of profits, the destruction of physical items containing the allegedly infringing marks, monetary damages, and attorneys' fees.

By their Answer and Amended Answer defendants denied any infringement of plaintiffs' alleged right to use a "Brooklyn Dodger" trademark. Defendants also pleaded the defenses of abandonment by plaintiffs of any "Brooklyn Dodgers" mark which plaintiffs may have owned at one time, as well as laches. The abandonment defense was premised upon the plaintiffs' failure to make any commercial or trademark use of the "Brooklyn Dodgers" name for at least 25 years after Los Angeles left Brooklyn in 1958. The laches defense was premised upon the fact that plaintiffs waited for more than a year and a half after learning of defendants' use of the allegedly infringing trademark before advising defendants of any alleged infringement. During this period defendants expended substantial resources and monies in establishing their restaurants in Brooklyn, New York. Defendants further pleaded the defense of unclean hands.

Finally, in their Amended Answer, defendants counterclaimed for the cancellation of various trademark registrations for "Brooklyn Dodgers" filed by plaintiffs after defendants' application to register the "Brooklyn Dodger" servicemark was filed on April 28, 1988.² These cancellations are sought on the ground that plaintiffs' registrations: a) falsely and deceptively suggest and imply a connection between plaintiffs and the Borough of Brooklyn which has not existed since 1958; b) inherently and directly misrepresent the origin of plaintiffs' goods and services as Brooklyn, New York when in fact this is untrue, in violation of 15 U.S.C. § 1052; and c) plaintiffs' use of a "Brooklyn Dodgers" mark suggests an association with defendants which does not exist, in violation of 15 U.S.C. § 1125(a).

On July 29, 1991, plaintiffs filed a motion for a preliminary injunction seeking to enjoin the use of the "Dodger" and "Brooklyn Dodger" name and defendants' logo in connection with the Canarsie establishment. (Tr. of 3/31/92 Hearing at 72; Tr. 707)

On March 31, 1992, the Honorable Kimba M. Wood of this court, to whom this case was then assigned, conducted a hearing. The parties submitted memoranda of law and affidavits in connection with the motion for a preliminary injunction. The court granted plaintiffs' motion for a preliminary injunction and enjoined defendants from using the mark the "Brooklyn Dodger" and the word "Dodger" written in standard athletic script as now used by defendants in connection with their third restaurant. (Tr. of 3/31/92 Hearing 69)

However, the court denied plaintiffs' application for summary judgment. Plaintiffs withdrew all claims for legal damages set forth in paragraph 4 of their Prayer for Relief, leaving only their equitable claims for injunctive relief (Prayer for Relief ¶ 1) and the destruction of all physical objects which make use of the "Brooklyn Dodger" mark (Prayer for Relief ¶ 3) and an accounting on their Lanham Act and common law claims. (See correspondence between counsel dated April 14, 16 and 17, 1992) (Tr. 2) Plaintiffs also seek an award of their attorneys' fees under the Lanham Act and common law. Following a preliminary hearing, a bench trial commenced on May 18, 1992 and continued until May 21, 1992. At the close of the trial the court reserved decision on all issues presented and requested that the parties submit proposed Findings of Fact and Conclusions of Law not later than July 17, 1992.

II. FINDINGS OF FACTS

After hearing the evidence and weighing the testimony and exhibits received in evidence, as well as the credibility of the witnesses, the court makes the following findings of fact:

A. The Parties

Plaintiff Properties is a corporation with offices and its principal place of business in New York, New York. It is the official trademark licensing, publishing, and marketing arm of the 26 Major League Baseball Clubs (the "Major League Clubs"). Properties is also charged with the responsibility of protecting the trademarks of these teams. (Trial Transcript "Tr." at 41)

Plaintiff Los Angeles is a corporation with offices and its principal place of business in Los Angeles, California. It is the owner of the Los Angeles Dodgers, a professional baseball team which, since 1958, has played baseball in Los Angeles, California under the name the "Los Angeles Dodgers." (Plaintiffs' Exhibit "PX" 17) Prior to 1958 the same professional baseball team played baseball in Brooklyn, New York and were known as the "Brooklyn Dodgers" or the "Dodgers."

In 1958, the team moved the site of its home games from Brooklyn to Los Angeles. (Tr. 252-53) At that time, the corporation was known as the Brooklyn National League Baseball Club, Inc. which owned the Brooklyn Dodgers or the Dodgers. It pointedly changed its name to Los Angeles Dodgers, Inc. (Tr. 259-60) Since then the team known as the "Los Angeles Dodgers" has never played baseball in Brooklyn, New York. (Tr. 332).

By agreement with the Major League Clubs, Properties has been granted the exclusive right to market, license, publish, publicize, promote nationally, and protect the trademarks owned by the Major League Clubs, including those owned by the Los Angeles Dodgers. (Tr. 41, 52-53, 116-17)

Properties' licensing activities on behalf of the Major League Clubs have evolved and expanded over time. In the early 1980s, the Major League Clubs were responsible for licensing on their own, with some additional baseball-wide licensing provided by Properties. In the mid-1980s, by agreement with the Major League Clubs, all of the retail licensing activities of the Major League Clubs were consolidated within Properties. (Tr. 41-42)

Over 400 licensed manufacturers sell more than 2,500 different Major League Baseball licensed products. (Tr. 57) The range of products includes apparel, such as caps and T-shirts, trading cards, games, electronic items, novelties and accessories, and youth "Little League" merchandise.

In 1986, retail sales of licensed Major League Baseball merchandise were approximately $200 million. (PX 16 at 11) By 1991, retail sales of licensed Major League Baseball merchandise were in excess of $2 billion. (Tr. 55-56) Properties, however, receives only a royalty payment on the wholesale price of these products. (Tr. 55) After trial, in response to the court's request for information concerning the amount of sales attributable to commercial use of the "Brooklyn Dodgers" mark after 1981, plaintiffs responded that precise figures could not be provided. Specifically, plaintiffs stated:

... Properties' records from the 1980s regrettably do not permit a precise breakdown of sales of goods bearing a specific trademark. As a result, figures representing sales of goods bearing the Dodgers' marks incorporating the word Brooklyn were, in most instances, subsumed within overall sales figures of merchandise bearing the Dodgers' marks, and not separately itemized. Recently, however, we have been accumulating more accurate records regarding sales of goods bearing individual Club trademarks. Based on this information and our general knowledge of our products, it is our best estimate that approximately $9 million worth of goods bearing the Dodgers' marks incorporating the word Brooklyn were sold in 1991.... we have contacted many of Properties' licensees, but unfortunately their records also do not permit us to obtain a more precise determination of annual retail sales during the 1980s of good bearing specifically the mark "Brooklyn Dodgers," separate and apart from retail sales of goods bearing the Dodgers' trademarks as a group.

(See Affidavit of Richard E. White, sworn Sept. 11, 1992 at 5-6)

In addition to its licensing and marketing...