Migliore & Assocs., LLC v. Kentuckiana Reporters, LLC

• Decision Date: 18 February 2015
• Docket Number: CIVIL ACTION NO. 3:13-CV-315-JGH
• Parties: MIGLIORE & ASSOCIATES, LLC and LISA MIGLIORE BLACK PLAINTIFFS v. KENTUCKIANA REPORTERS, LLC DEFENDANT
• Court: U.S. District Court — Western District of Kentucky

MIGLIORE & ASSOCIATES, LLCand LISA MIGLIORE BLACK PLAINTIFFS v. KENTUCKIANA REPORTERS, LLC DEFENDANT

CIVIL ACTION NO. 3:13-CV-315-JGH

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF KENTUCKY AT LOUISVILLE

February 18, 2015

MEMORANDUM OPINION AND ORDER

The court reporter game is a tough racket. It's tougher still when a competitor registers an internet domain name that is confusingly similar to your business name then links it to its own website. That is what Lisa Migliore Black, the sole member of Migliore & Associates, LLC (together "Migliore"), accuses Kentuckiana Reporters, LLC ("Kentuckiana") of doing. Migliore has sued Kentuckiana under the Lanham Act (15 U.S.C. § 1125(a)), the Anticybersquatting Consumer Protection Act ("ACPA," 15 U.S.C. § 1125(d)), and Kentucky common law prohibitions against unfair competition. In increasingly venomous briefings, Kentuckiana has asked the Court for summary judgment; Migliore wants to try the case. For the following reasons, the Court denies Kentuckiana's motion.

I.

Lisa Migliore began working as a court reporter in Louisville in 1997. She established the Kentucky LLC "Migliore & Associates" in 2001—she was and still is its sole member. She married in 2009, but because of the goodwill and name recognition attached to her maiden name, she kept "Migliore" as part of her married name. Today, her name is "Lisa Migliore Black," yet she answers to variations on her name like "Lisa Migliore," "Lisa Black," and even "Lisa Mig."Her LLC's name has not changed. Since 2005 Migliore has maintained a website at www.miglioreassociates.com. She may be the only "Migliore" doing court reporting in the United States. Searches on popular internet search engines associate her with court reporting and Migliore & Associates. And Migliore has spent thousands of dollars each year promoting her business through advertising in print publications; internet listings; and the distribution of marketing materials like mugs, pens, and post-it notes.

Kentuckiana is also a single-member Kentucky LLC in the Louisville area. It uses the domain name www.kentuckianareporters.com. Bekah Turner McDonner has been the sole owner of Kentuckiana since July 2010. Her husband, Michael McDonner, is a former attorney who now works as Kentuckiana's business development manager. In August 2011 Kentuckiana registered the following domain names with GoDaddy.com, LLC: www.andorreporters.com, www.actionreporters.com, www.coultereporting.com, www.coulterreporters.com, www.kentuckycourtreporting.com, www.kycourtreporter.com, and www.lisamigliore.com. Of those seven domain names, five—including, of course, www.lisamigliore.com—were similar or identical to the business names of Kentuckiana competitors. At some point, Kentuckiana linked www.lisamigliore.com and the other sound-alikes to its own website, which re-routed the web traffic to its site. This means, for example, that anyone who typed in "www.lisamigliore.com" and hit "Enter" would be redirected to Kentuckiana's website. One of Kentuckiana's competitors noticed the anomaly and warned Migliore.

Migliore sent a cease and desist letter in June 2012. Kentuckiana discontinued redirection to its own website, but it refused to transfer the domain name to Migliore. That August, Migliore proceeded under the Uniform Dispute Resolution Policy and filed a complaint with an arbitral panel of the World Intellectual Property Organization Arbitration and MediaCenter ("WIPO"). Kentuckiana maintained that it registered the disputed domain name to use it as a possible "gripe site" or "fact check site" regarding Migliore's public comments on policy issues related to the court reporter industry. Yet www.lisamigliore.com was never developed—no content was ever put on it. Ultimately, the WIPO arbitrator decided that Kentuckiana acted in bad faith and ordered it to transfer the domain name to Migliore. But since Kentuckiana still refused to reimburse Migliore for the costs of bringing the WIPO action, Migliore filed this suit. Discovery is now complete, Kentuckiana has moved for summary judgment.

II.

Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Fed. R. Civ. P. 56(c). The Court must determine whether "the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Patton v. Bearden, 8 F.3d 343, 346 (6th Cir. 1993) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986)). The Court will view the evidence in the light most favorable to Migliore, the non-movant, and draw all reasonable inferences in her favor. See Bender v. Southland Corp., 749 F.2d 1205, 1210-11 (6th Cir. 1984).

III.

First, Kentuckiana argues that Migliore lacks standing to make a Lanham Act claim. "In essence the question of standing is whether the litigant is entitled to have the court decide the merits of the dispute or of the particular issues . . . . As an aspect of justiciability, the standing question is whether the plaintiff has 'alleged such a personal stake in the outcome of thecontroversy' as to warrant his invocation of federal-court jurisdiction and to justify exercise of the court's remedial powers on his behalf." Warth v. Seldin, 422 U.S. 490, 498-99 (1975) (citing Baker v. Carr, 369 U.S. 186, 204 (1962)). The key component of standing is the "case-or-controversy requirement of Article III (of the United States Constitution)." Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992) (citation omitted)). The case-in-controversy inquiry requires three elements to establish standing. See id. at 560-61. Pertinent to our case, the first element is that "the plaintiff must have suffered an 'injury in fact'—an invasion of a legally protected interest which is (a) concrete and particularized . . . and (b) 'actual or imminent, not 'conjectural' or 'hypothetical.''" Id. at 560 (citations omitted).

As a general matter, the Court feels it necessary to note that just because an injury is difficult to measure or quantify does not mean that the injury is nonexistent. See, e.g., Eastman Kodak Co. of New York v. Southern Photo Materials Co., 273 U.S. 359 (1927). Kentuckiana's counsel conflates the concepts of "injury" and "provable money damages." Beyond legal niceties, it borders on the absurd to assert that purchasing a domain name that includes a variation of a competitor's personal name, then linking that website to your own, would cause no injury to your competitor. But that is essentially Kentuckiana's argument. Kentuckiana admits it registered these domain names; it admits that www.lisamigliore.com was linked to redirect to its own site. Yet it denies that Migliore has suffered anything more than a conjectural or hypothetical injury. The Court is convinced, however, that Migliore has a true case-in-controversy because, at the very least, Migliore incurred damage control costs that satisfy the injury requirement for Article III standing.

In Balance Dynamics Corp. v. Schmitt Industries, Inc., the Sixth Circuit explained that courts must be careful to distinguish "the elements necessary to prove a breach of the LanhamAct from the elements necessary to justify a certain remedy for the breach: 'the inquiries should be kept separate because a violation of the Lanham Act can be remedied in more ways than one.'" 204 F.3d 683, 689 (2000) (citation omitted). The court then noted that some types of damages fall outside of "actual" or "marketplace"¹ damages. Lanham Act plaintiffs can sometimes recover for damage control without showing actual confusion or actual damages. Id. at 689-90. Damage control costs are what they sound like: they are costs plaintiffs must incur to protect themselves from nefarious acts of their competitors. "[L]ike an injunction, damage control is undertaken precisely to prevent such things as lost sales, lost profits, and lost goodwill." Id. at 691.

The Sixth Circuit relied on the policy rationale that "[t]he law should encourage quick responses and the mitigation of damage, and should not require parties to suffer an injury before trying to prevent it." Id. at 691-92. In sum, the Sixth Circuit decided that "a plaintiff should not be required to give up compensation for its damage control expenses when the defendant's wrongful action necessitated those expenses in the first place." Id. at 692. A plaintiff will be entitled to damage control costs when it can show (1) likelihood of confusion or damage to profits, goodwill, or sales; (2) that the damage control expenses were caused by defendant's Lanham Act violation; and (3) that the damage control efforts were reasonable and proportionate to the damage likely to occur. Id. at 692-93.

A request for damage control costs is appropriate here. As in Balance Dynamics, Kentuckiana's actions could have harmed Migliore's business. She reached out to Kentuckiana and, to its credit, Kentuckiana stopped the redirection of www.lisamigliore.com to www.kentuckianareporters.com. It still refused, however, to turn over www.lisamigliore.com to Migliore. Fearing lost business, Migliore commenced a WIPO proceeding. After determiningthat Kentuckiana acted in bad faith, the WIPO arbitrator had Kentuckiana transfer the domain name to Migliore. It cost Migliore—including attorneys' fees—$4,000 to pursue the WIPO action. Viewing the facts in the light most favorable to Migliore, the non-movant, enough has been presented to convince the Court that Migliore suffered actual harm, as evidenced by its need to expend reasonable damage control costs to prevent damage to its profits and goodwill caused by Kentuckiana's bad faith act. Migliore has enough for standing under the Lanham Act, so the...