New York Stock Exc. v. New York, New York Hotel

• Decision Date: 30 September 1999
• Docket Number: No. 97 Civ. 2859(MGC).,97 Civ. 2859(MGC).
• Citation: New York Stock Exc. v. New York, New York Hotel, 69 F.Supp.2d 479 (S.D. N.Y. 1999)
• Parties: NEW YORK STOCK EXCHANGE, INC., Plaintiff, v. NEW YORK, NEW YORK HOTEL, LLC and New York, New York Hotel & Casino, LLC, Defendants.
• Court: U.S. District Court — Southern District of New York

69 F.Supp.2d 479

NEW YORK STOCK EXCHANGE, INC., Plaintiff, v. NEW YORK, NEW YORK HOTEL, LLC and New York, New York Hotel & Casino, LLC, Defendants.

No. 97 Civ. 2859(MGC).

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

September 30, 1999.

Baker & Botts, L.L.P., New York City, by Doreen L. Costa, Joseph D. Garon, Paul J. Reilly, for plaintiff.

Kelley, Drye & Warren, L.L.P., New York City, by William Golden, Jr., for plaintiff.

Skadden, Arps, Slate, Meagher & Flom, LLP, New York City, by Kenneth A. Plevan, Bruce J. Goldner, Scott Brown, for defendants.

Quirk & Tratos, Las Vegas, Nevada, by Mark G. Tratos, Bradley L. Booke, Michael McCue, for defendants.

OPINION

CEDARBAUM, District Judge.

Defendant New York, New York Hotel & Casino, LLC (the "Casino"), the corporate successor to defendant New York, New York Hotel, LLC, operates a hotel and casino in Las Vegas that has as its theme New York City. Among the references to New York City, the Casino features a large replica facade of the New York Stock Exchange building, which appears on the Casino floor, and a players club called "New York $lot Exchange." Plaintiff New York Stock Exchange, Inc. ("NYSE") objects to these uses, claiming that they constitute trademark infringement and unfair competition, trademark dilution, and false advertising under the Lanham Act. The NYSE asserts essentially the same claims under New York law. The Casino moves for summary judgment dismissing all of the NYSE's claims. For the reasons set forth below, the Casino's motion is granted.

UNDISPUTED FACTS

I. The NYSE and its Marks

The NYSE is a not-for-profit corporation that is principally engaged in the business of operating a market for the trading of securities issued by listed entities. The NYSE has been located in the same building, on Broad Street in lower Manhattan, since 1903. (Zito Aff. ¶ 4C.) Across the building's facade are six Corinthian columns, and at the pediment above the columns is a bas-relief sculpture designed by John Quincy Adams Ward and Paul Bartlett. (Reilly Decl.Ex. 12.)

The NYSE's service marks "New York Stock Exchange" and "NYSE" were registered on the Principal Register of the United States Patent and Trademark Office in 1971 for conducting a securities exchange and providing other related services. (Zito Decl.Exs. 1A and 1B.) The registrations show the year 1863 as the marks' first use. (Id.) The NYSE also obtained registration of a stylized form of "NYSE," in which all of the letters except the letter "S" have thin horizontal slots running through them. (Id. Ex. 1D.) Finally, the NYSE registered a two-dimensional representation of its building facade with the words "NEW YORK STOCK EXCHANGE" located beneath the facade's pediment. (Id. Ex. 1C.)¹ That mark was registered as a service mark on the Principal Register in 1993.

The NYSE regularly places advertisements in business magazines and newspapers, and has spent more than $61 million to advertise its services during the period 1988 to 1997. (Zito Decl. ¶ 10.) The NYSE's advertising budget for 1998 was approximately $15 million. (Id. ¶ 12.) In its advertisements, the NYSE sometimes uses the slogan: "The world puts its stock in us." (E.g., id. Ex. 16.) The NYSE's Internet site includes information on how the NYSE is regulated (under the heading "Protecting the Markets") and how a person can become an "educated investor." (Id. Ex. 4.) Under the heading "Putting Your Money to Work," the site explains several options for a person who wishes to invest his money. It states: "If you've worked hard to save up some extra cash, you'd probably like a safe place to store it." (Id.)

The NYSE uses some of its marks on souvenir items such as t-shirts, desktop items and umbrellas that are given away or sold by the NYSE at its Interactive Education Center or at two hotel gift shops in New York City. (Payton Decl. ¶¶ 4, 7.) For the period 1987 to 1997, the NYSE had total revenues of more than $10 million from sales of items bearing one or more of the NYSE marks. (Id. ¶ 6.)

The NYSE's Senior Vice President for Communications testified by declaration that "numerous" companies "regularly request permission from" the NYSE to use its marks, and that the NYSE "carefully reviews and analyzes each such request ... to determine whether the proposed use is consistent with the [NYSE's] goals and the values the Marks represent." (Zito Decl. ¶¶ 27, 28.) The NYSE proffers various cease-and-desist letters that it has sent to object to unauthorized uses of the NYSE marks, including the facade. (Zito Decl. ¶ 32 & Ex. 14.) One such letter, dated October 6, 1997, objected to a newspaper advertisement for a floating casino in Brooklyn which prominently used the words "NEW YORK SLOT EXCHANGE." (Id. Ex. 14(G).)

II. The Casino

The Casino opened for business on January 3, 1997. The Casino's exterior mimics features of the Manhattan skyline, with replicas of several famous buildings including the Empire State Building and the Chrysler Building. (Def.Ex.A.) The exterior includes replicas of other New York landmarks such as the Statue of Liberty and the Ellis Island immigration station.

Other "theme" hotels and casinos in Las Vegas include Rio (theme of Rio de Janeiro), The Orleans (theme of New Orleans) and Caesar's Palace (theme of ancient Rome). (Moore Aff. ¶ 7.)

Rooms and common areas in the Casino are named after famous New York City neighborhoods or landmarks, such as the "Coney Island Emporium" (a game arcade), "Soho Village" and "Park Avenue" (retail shops), the "Financial District" (casino cashier cages) and "Greenwich Village" (food court area). (Moore Aff. ¶ 17.) Numerous interior wall scenes show Manhattan neighborhoods and buildings, complete with street and subway signs to direct patrons to various areas of the Casino, as well as parking meters and steaming manhole covers. (Id. ¶ 21.)

The Casino's primary logo consists of its name ("New York New York Hotel & Casino") surrounding a picture of the Statue of Liberty. (Def.Ex.G.) A stylized image of the Statue of Liberty, in the pose of a showgirl, is used by the Casino on the gaming floor and in promotional materials, often with the slogan "With Luck and Liberty for All." (Def.Ex. B; Moore Aff. ¶ 28.) The Casino's Coney Island arcade includes such games as "Wac-A-Mayor," in which contestants try to slam the heads of former New York City mayors with large mallets, and a ring-toss game called the "Great New York New York Bottleneck." (Moore Aff. ¶ 29.)

In 1997, its first year of operation, 15 million people entered the Casino. (Moore Dep. 120.)

III. Challenged Uses

The Facade. On the back wall of the "Financial District" kiosk, where the cashiers are located, is a large replica of the facade of the NYSE building. The words "NEW YORK NEW YORK SLOT EXCHANGE" appear on the replica in place of the words "NEW YORK STOCK EXCHANGE." (Moore Aff. ¶ 30.) When the Casino first opened in January 1997, the replica facade bore the name "NEW YORK NEW YORK STOCK EXCHANGE." The Casino changed the name after it received complaints from the NYSE. (Sherlock Dep. 32-33; Primm Dep. 56-57; Moore Dep. 37-38.) The replica facade is visible from one portion of the Casino's floor where slot machines are located.

A photograph of the replica facade was included in a Casino press kit distributed at the time of its opening. (Moore Dep. 67-68.) Approximately 600 such press kits were distributed. (Reilly Decl.Ex. 1 ¶ 43.) Photographs of the replica facade, including the photograph distributed by the Casino, appeared in newspapers nationwide. (Reilly Decl.Ex. 1 ¶ 44.) There is no evidence that the Casino has used pictures of the replica facade on its Internet site or on any merchandise.

The Players Club. The Casino sponsors a players club for regular users of the Casino's slot machines and other gaming activities. The initial name of the players club was "New York $lot Exchange," and members were issued cards bearing this name. After the NYSE complained, the Casino changed the name of the players club to "New York New York $lot Exchange." (Primm Dep. 60-61.) The Casino has used the old and the new forms of the name on marketing materials. (Def.Ex. C; Perry Dep. 34; Reilly Decl. Ex. 1 ¶ 60.) Each of the Casino's slot machines has a panel with the words "New York $lot Exchange," indicating where players club members should insert their membership cards. (Reilly Ex. 1 ¶ 54; see also 3/4/99 Tr. 51, 67, 95.) In addition, the Casino has used "NY$E" and "NY-NY$E" in some of its advertising. (Reilly Decl. Ex. 78; Moore Aff. ¶ 33.) At oral argument, the Casino's counsel represented that the Casino will not use any form of the "NY$E" mark in the future. (3/4/99 Tr. 94.)

A promotional brochure and registration form for the players club includes the slogan: "NEW YORK $LOT EXCHANGE Where Dividends are Paid Daily." (Def.Ex. C.) The brochure also juxtaposes the name "New York $lot Exchange" above the image of the Statue of Liberty as a showgirl, and the words "With Liberty and Luck for All." (Id.)

The Casino sends promotional materials for the players club to past Casino guests and patrons as well as residents of Las Vegas. (Reilly Decl.Ex. 1 ¶ 58.) The Casino maintains an interactive site on the Internet, through which it promotes the services of the Casino and solicits enrollment in the players club. A person may register to become a member of the players club through the site. (Id. ¶ 59.) After the first year of the Casino's operation, there were over 250,000 active members of the players club to whom membership cards were issued bearing the designation "New York $lot Exchange." (Id. ¶ 53.)

The Casino has used "New York $lot Exchange" or "New York New York $lot Exchange" on merchandise such as t-shirts, hats and gloves that are given by the Casino to members of the players club. (Perry Dep. 34; Reilly Decl.Ex. 1 ¶ 60.) None of this merchandise is offered for sale. (Busch Dep. 50.)

The Casino filed a federal...