Opacmare USA, LLC v. Lazzara Custom Yachts, LLC
| Decision Date | 28 February 2018 |
| Docket Number | Case No. 8:16–cv–3288–T–33JSS, Case No. 8:16–cv–3288–T–33JSS |
| Citation | 314 F.Supp.3d 1276 |
| Parties | OPACMARE USA, LLC, Plaintiff, v. LAZZARA CUSTOM YACHTS, LLC, Defendant. Lazzara Custom Yachts, LLC, Counterclaimant, v. Opacmare USA, LLC, Counterclaim Defendant. |
| Court | U.S. District Court — Middle District of Florida |
Christopher K. Leigh, Christopher K. Leigh, P.A., Fort Lauderdale, FL, Jeffrey B. Sladkus, Pro Hac Vice, Mark L. Seigel, Pro Hac Vice, The Sladkus Law Group, Jason Harris Cooper, Atlanta, GA, for Plaintiff.
Christopher Paul Benvenuto, Gunster, Yoakley & Stewart, PA, West Palm Beach, FL, Preethi Sekharan, Stephen Charles Page, Gunster, Yoakley & Stewart, PA, Stuart, FL, for Defendant.
This matter comes before the Court pursuant to the Motion for Summary Judgment filed by Lazzara Custom Yachts, LLC on September 15, 2017 (Doc. # 79), with a response in opposition thereto filed by Opacmare USA, LLC on October 17, 2017 (Doc. # 84), and a reply in support thereof filed by Lazzara Custom Yachts on October 31, 2017 (Doc. # 86); the Cross Motion for Summary Judgment filed by Opacmare on November 3, 2017 (Doc. # 88), with a response in opposition thereto filed by Lazzara Custom Yachts on November 30, 2017 (Doc. # 89), and a reply in support thereof filed by Opacmare on December 18, 2017 (Doc. # 92); and the Motion for Sanctions filed by Lazzara Custom Yachts on January 19, 2018 (Doc. # 93), with a response in opposition thereto filed by Opacmare on February 2, 2018 (Doc. # 99).
For the reasons that follow, Lazzara Custom Yachts's Motion for Summary Judgment (Doc. # 79) is granted, Opacmare's Cross Motion for Summary Judgment (Doc. # 88) is denied, and Lazzara Custom Yachts's Motion for Sanctions (Doc. # 93) is denied.
Opacmare originally brought this action seeking damages and injunctive relief against Lazzara Custom Yachts, Joseph M. Lazzara, and Steven B. Lazzara, for trademark infringement under 15 U.S.C. § 1114 and Florida common law, trademark counterfeiting under 15 U.S.C. § 1114, unfair competition under 15 U.S.C. § 1125(a) and Florida common law, cyberpiracy under 15 U.S.C. § 1125, and violation of the Florida Deceptive and Unfair Trade Practices Act under Fla. Stat. § 501.201 et seq. (Doc. # 44). On July 6, 2017, the claims against Joseph and Steven Lazzara were dismissed. (Doc. # 69).
Opacmare alleged that Lazzara Custom Yachts was unlawfully using the LAZZARA trademark, United States Trademark Registration Number 3064907, which Opacmare claimed ownership of. (Doc. # 44 at ¶ 39). In its Answer to the Amended Complaint, Lazzara Custom Yachts raised several affirmative defenses, and counterclaims seeking a declaratory judgment declaring it to be the owner of the LAZZARA Mark and a corresponding correction of the trademark registry. (Doc. # 53).
Upon Opacmare's motion, the Court dismissed without prejudice the First Amended Complaint. (Doc. # 87). As such, the case proceeds only on Lazzara Custom Yachts's counterclaims, on which both parties now seek summary judgment. (Doc. ## 79, 88). Lazzara Custom Yachts's Motion also sought summary judgment on the claims in the First Amended Complaint. (Doc. # 79). However, since the First Amended Complaint has been dismissed, the Court addresses the Motion only as to Lazzara Custom Yachts's counterclaims.
Additionally, Lazzara Custom Yachts seeks sanctions under Federal Rule of Civil Procedure 11, alleging that Opacmare continues to raise frivolous arguments in its Answer to Lazzara Custom Yachts's counterclaims. (Doc. # 93). The Motions are ripe for review.
Summary judgment is proper where "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56. Summary judgment will be granted unless there is a "genuine issue of material fact." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (emphasis in original). An issue is genuine if there is a "real basis in the record" on which "a reasonable jury could return a verdict for the non-movant." Hairston v. Gainesville Sun Publ'g Co., 9 F.3d 913, 919 (11th Cir. 1993). A fact is material if it might affect the outcome of the suit under the applicable substantive law. Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997). If there is a conflict between the allegations or evidence, all reasonable inferences should be drawn in the non-moving party's favor. Shotz v. City of Plantation, 344 F.3d 1161, 1164 (11th Cir. 2003). However, if "the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no ‘genuine issue for trial.’ " Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).
Under Rule 11, an attorney certifies that in any paper presented to the Court, "the factual contentions have evidentiary support (or will likely have evidentiary support after a reasonable opportunity for further investigation or discovery) and the legal contentions are warranted by existing law or a nonfrivolous argument for extending or altering existing law or for establishing new law." Lee v. Mid–State Land & Timber Co., 285 Fed.Appx. 601, 608 (11th Cir. 2008) (citing Fed. R. Civ. P. 11 ). In addressing a motion under Rule 11, the Court conducts a two-part inquiry: (1) "whether the party's claims are objectively frivolous," either factually or legally, and, if so, (2) "whether the person who signed the pleadings should have been aware that they were frivolous." Worldwide Primates, Inc. v. McGreal, 87 F.3d 1252, 1254 (11th Cir. 1996).
A. Summary Judgment
In seeking summary judgment on Lazzara Custom Yachts's counterclaims, the parties seek a determination from this Court as to the legal ownership of the LAZZARA Mark. Making that determination requires the Court to trace the ownership of the LAZZARA Mark as it transferred between several different entities. The undisputed facts are as follows.
In the early 1990s, Richard "Dick" Lazzara and Steven "Brad" Lazzara founded Lazzara Yacht Corporation, a separate corporate entity from the named defendant in this case. (Doc. ## 74 at 5, 75 at 5). Lazzara Yacht Corporation manufactured high-end yachts, which sold for upwards of $20 million. (Doc. # 75 at 17). As part of that business, Dick Lazzara created the LAZZARA Mark. (Doc. # 74 at 6). On March 7, 2006, he registered it with the United States Patent and Trademark Office. (Doc. # 74–2).
On or about May 7, 2007, Lazzara Yacht Corporation entered into a $15 million revolving credit loan agreement with Tennessee Commerce Bank. (Doc. # 75–2). Lazzara Yacht Corporation signed a promissory note (Doc. # 75–4) and a security agreement (Doc. # 74–1), which granted Tennessee Commerce Bank a security interest in Lazzara Yacht Corporation's general intangibles as collateral to the loan agreement. The general intangibles collateralized by the security agreement included the LAZZARA Mark. (Doc. # 75 at 9). On May 9, 2007, Tennessee Commerce Bank filed a Uniform Commercial Code Financing Statement, perfecting its interest in the LAZARRA Mark. (Doc. # 79–2).
Eventually, Tennessee Commerce Bank went bankrupt and the Federal Deposit Insurance Corporation was named Tennessee Commerce Bank's Receiver. (Doc. ## 74 at 7, 73 at 6). As Receiver, the FDIC sold a pool of loans, including the loan secured by the LAZARRA Mark, to ReVal Financial, LLC. (Doc. # 73–2). On September 4, 2012, ReVal filed a UCC Financing Statement, reflecting the assignment. (Doc. # 73–4).
Lazzara Yacht Corporation was unable to repay the loan and soon fell into default. (Doc. # 75 at 9). ReVal attempted to assist Lazzara Yacht Corporation in selling the company for nearly two years. (Doc. # 73 at 11). The record references a Settlement Agreement dated January 22, 2013, and a Forbearance dated October 19, 2012. (Doc # 73–11 at 25–26). However, it appears that neither document is currently before the Court. After being unable to secure a buyer for the defaulted company, ReVal assigned its interest in the secured loans to ReVal Financial NPL, LLC. (Doc. # 73–5). ReVal NPL filed a UCC Financing Statement reflecting the assignment. (Doc. ## 73–6, 73–7). Thereafter, ReVal NPL sought to foreclose on Lazzara Yacht Corporation's assets, including the LAZARRA Mark, and sell them to a third party, GB Asset Investments, LLC. (Doc. # 73 at 19).
On or around October 9, 2014, notification was sent to Lazzara Yacht Corporation and its secured creditors that Lazzara Yacht Corporation's assets would be sold "through a private sale sometime on or after October 24, 2014." (Doc. # 73–9). That notification indicated it was from ReVal Financial Properties, LLC. (Doc. # 73–9). ReVal Properties and ReVal NPL are both wholly-owned subsidiaries of Republic Financial Corporation. (Doc. # 73 at 5) Subsequently, ReVal Properties sent an undated "Notice of Disposition of Assets," stating that it was "exercising its right to foreclose upon and transfer right, title, and interest in the Assets," including the LAZARRA Mark, "to itself." (Doc. # 73–12). It further stated that it foreclosed "through a private sale under Uniform Commercial Code § 9–610," which is codified in Florida Statutes section 679.610. (Doc. # 73–12).
Effective November 7, 2014, ReVal NPL and ReVal Properties sold the LAZZARA Mark, and other assets, to GB Asset for $90,000. (Doc. # 73–11). Simultaneously, GB Asset also purchased a barge from Lazzara International Yacht Sales, Inc., an entity related to Lazzara Yacht Corporation, for $1,150,000. (Doc. # 73–15). Also executed was a release of lender, in which ReVal NPL and ReVal Properties (as lenders) agreed to release the liens ...
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