Sound Surgical Technologies, LLC v. Leonard A. Rubinstein, M.D., P.A.

• Decision Date: 12 August 2010
• Docket Number: Case No. 8:10-CV-970-T-27MAP
• Citation: 734 F.Supp.2d 1262
• Parties: SOUND SURGICAL TECHNOLOGIES, LLC, Plaintiff, v. LEONARD A. RUBINSTEIN, M.D., P.A., and Leonard A. Rubinstein, M.D., Defendants.
• Court: U.S. District Court — Middle District of Florida

734 F.Supp.2d 1262

SOUND SURGICAL TECHNOLOGIES, LLC, Plaintiff,

v.LEONARD A. RUBINSTEIN, M.D., P.A., and Leonard A. Rubinstein, M.D., Defendants.

Case No. 8:10-CV-970-T-27MAP.

United States District Court,

M.D. Florida,

Tampa Division.

Aug. 12, 2010.

Suzanne Barto Hill, Rumberger, Kirk & Caldwell, PA, Orlando, FL, for Plaintiff.

Michael G. Brown, Law Office of Michael G. Brown, Sarasota, FL, for Defendants.

ORDER

JAMES D. WHITTEMORE, District Judge.

BEFORE THE COURT is Plaintiff's Motion for Preliminary Injunction (Dkt. 3) and the parties' affidavits supporting and opposing the motion (Dkts. 4, 5, 14, 17, 19).¹ Having considered the parties' submissions and the arguments of counsel at the June 2, 2010, hearing, the Court concludes that Plaintiff's motion should be GRANTED in part.

Background

Plaintiff Sound Surgical Technologies, LLC ("Plaintiff or SST") manufactures and distributes the VASER System, which is an ultrasonic surgical system used by physicians to perform ultrasound-assisted lipoplasty.² Defendant Leonard A. Rubinstein, M.D., P.A. ("Rubinstein P.A.") is a Florida corporation operating as a medical practice in Sarasota County. Defs. Ans., Dkt. 22, ¶ 2. Rubinstein, P.A. is owned and operated by Defendant Leonard A. Rubinstein, M.D. ("Rubinstein"). Id. In his practice, Rubinstein offers, among other services, cosmetic surgery, including lipoplasty. Id.; Goldberger Aff. ¶ 2.

About February 26, 2007, Plaintiff entered into a License and Use Agreement (the "LUA" [Dkt. 5 at 15-19] ) with Rubinstein P.A. Id.; Dkt. 22, ¶ 14. Pursuant to the LUA, Rubinstein P.A. was granted a nonexclusive license to use Plaintiff's VASER System (or, as, as Rubinstein calls it, Plaintiff's VASER LIPOSELECTION System). The agreement also granted Rubinstein P.A. the right to use Plaintiff's registered trademark VASER ³ and Plaintiff's registered service mark LIPOSELECTION,⁴ subject to Plaintiff's prior review and approval of any proposed use of the marks in any manner other than on marketing materials provided by Plaintiff, "including use on [Rubinstein P.A.'s] website or in other advertising or marketing material." LUA § 1.e.

The LUA provides that its initial term commences "on the date [Rubinstein P.A.] accept[s] the Equipment (the 'Effective Date') and continues through the last day of the 24th full calendar month following such date of acceptance" unless terminatedsooner as provided in the agreement. LUA § 1.a. The LUA provides that Rubinstein P.A. may renew the LUA for additional 24-month terms "by notice given to [Plaintiff] at least 30 days prior to the end of the term then in effect ...." Id.

In their initial affidavits, John Sullivan and Daniel Goldberger, Plaintiff's chief financial officer and chief executive officer, respectively, averred that the LUA expired on March 31, 2009 with respect to one VASER System (the "first system") and August 31, 2009 with respect to another (the "second system"). ⁵ As the first system was accepted on March 9, 2007 (Dkt. 5 at 23), the LUA by its terms evidently expired as to the first device on March 31, 2009. However, Goldberger and Sullivan do not explain how they derived the expiration date of August 31, 2009 for the second system. Attached to Sullivan's affidavit and to the Complaint is a document entitled "Acceptance of Equipment" (Dkt. 5 at 20) that appears to be an acknowledgment by Rubinstein of Rubinstein P.A.'s receipt of a second VASER system. The document also acknowledges that "the date of this Acceptance ... is the Effective Date of the Agreement," i.e., of the LUA (as a notation in the margin defining the "Agreement" indicates). As the document is dated August 14, 2008, it appears to suggest that the LUA was to expire by its terms as to this VASER system on August 31, 2010 (not 2009).

Rubinstein states that, without cause, Plaintiff unilaterally terminated the LUA.⁶ In his supplemental affidavit, Goldberger denies that Plaintiff terminated the LUA and avers that it "expired of its own terms on March 31, 2009 when Dr. Rubinstein failed to give notice of intent to renew after the initial 24 month term beginning April 1, 2007." Goldberger Supp. Aff. ¶ 4. Goldberger does not repeat his and Sullivan's averment that, as to the second system, the LUA expired on August 31, 2009. In sum, the record contains conflicting, ambiguous evidence as to when and how the LUA expired. However, all VASER Systems in Defendants' possession have been returned to Plaintiff. Goldberger Aff. ¶ 3; Sullivan Aff. ¶ 7; see also Rubinstein Aff. at 2, 4.

About January 15, 2008, Rubinstein registered (or "reserved") with an unspecified registrar the following eight domain names: vaserlipo.com, vaserlipo.org, vaserlipo.info, vaser-lipo.com, vaser-lipo.net, vaser-lipo.org, vaser-lipo.info, vaser-lipo.us (together, the "domain names"). Sullivan Aff. ¶ 8; see also Rubinstein Aff. at 1-2. Sullivan states that Defendants did not submit the proposed domain names to Plaintiff for prior approval and that the domain names were registered without Plaintiff's knowledge, authorization, or consent.⁷ Goldberger states that no person having authority to commit Plaintiff ever authorized Rubinstein to use the VASER mark in any domain name or to use the VASER LIPO mark in any manner.⁸

Additionally, Sullivan avers that, in the past, when a licensee physician has requested a specialized domain name directing internet traffic to the physician's website, Plaintiff (if it approved the domain name) would register the domain name in its own name and cause the domain name to direct Internet traffic to the licenseephysician's website. Sullivan Supp. Aff. ¶ 2. However, upon expiration of the pertinent license, Plaintiff would cause the domain name to direct Internet traffic to Plaintiff's official website, www. vaser. com. Id. Plaintiff has registered more than 280 domain names, most of which direct Internet traffic to Plaintiff's official website. Id. ¶ 3.

In their initial affidavits, Sullivan and Goldberger indicated that, as of April 8 and 12, 2010, respectively, the domain names channeled Internet traffic towww.larubinstein.com, the website for Defendants' medical practice, where Defendants advertise a laser-assisted lipoplasty procedure that differs significantly from Plaintiff's VASER System. Sullivan Aff. ¶ 8; Goldberger Aff. ¶ 4. Rubinstein did not dispute the fact in his initial affidavit. However, in a supplemental affidavit filed after the deadline imposed by the Court's May 10, 2010 order (Dkt. 8), Rubinstein states that, because there is no longer in effect an LUA that permits him to use Plaintiff's registered marks on his websites or other advertising relating to his medical practice, the domain names no longer direct traffic to Rubinstein's medical practice's website.⁹ Although Rubinstein does not state when the domain names ceased channeling traffic to the website for his medical practice, Rubinstein's counsel did not dispute Plaintiff's counsel's representation during oral argument that the domain names continued to do so until the day before the June 2, 2010, hearing.

Rubinstein does not state that Plaintiff specifically authorized registration of the domain names. However, Rubinstein states generally that, during an unspecified period before Plaintiff filed its application to register the VASER LIPO marks ( i.e., before September 22, 2008, see Dkt. 5 at 11), Goldberger was aware of and consented to Rubinstein's use of the term VASER LIPO in conjunction with Rubinstein's use of Plaintiff's VASER System. Rubinstein Aff. at 2. Additionally, Rubinstein avers that (a) Goldberger and another authorized SST representative, James Click, were aware of and consented to Rubinstein's use of Plaintiff's VASER mark in his advertising materials and on his websites from the inception of the LUA because (a) the LUA provision authorizing use of Plaintiff's VASER mark subject to Plaintiff's prior review and approval of any proposed use of the mark does not require that Plaintiff's approval be requested or obtained in writing and (b) when shortly after the LUA went into effect, Rubinstein met on two occasions with members of Plaintiff's national marketing and sales departments and discussed with them his marketing methods, his use of the VASER mark in his web-advertising was "was among the subjects discussed, approved and promoted." Rubinstein Supp. Aff. at 2-3.

Rubinstein avers that in March, 2008, Goldberger initiated negotiations with Rubinstein for Plaintiff's possible purchase of the domain names from Rubinstein. Rubinstein Aff. at 2. According to Rubinstein, it was only after his refusal to sell the domain names that any question arose as to the propriety of his registration of the domain names. Id.

Goldberger states that, by June 2008 at the latest, he contacted Rubinstein to inform Rubinstein that he was using "the registered marks" ¹⁰ without permissionand to ask him to transfer the domain names to Plaintiff. Goldberger Supp. Aff. ¶ 2.¹¹ In response, Rubinstein demanded $200,000 payment to transfer the domain names to Plaintiff. Id. Discussions continued and in July, 2009, Goldberger and Rubinstein met to try to resolve the matter. Id. Rubinstein maintained his demand for $200,000. Id. In a July 31, 2009 email, Goldberger stated that Rubinstein was improperly using the VASER LIPO mark in his domain names, offered Rubinstein $7,500 to resolve the matter, and threatened legal action. Id. & Ex. A (Dkt. 17 at 4). Rubinstein rejected the offer. Goldberger Supp. Aff. ¶ 2 & Ex. A (Dkt. 17 at 5-6).

Standard

A party seeking a preliminary injunction must show: "(1) a substantial likelihood of success on the merits of the underlying case, (2) the movant will suffer irreparable harm in the absence of an injunction, (3) the harm suffered by the movant in the absence of an injunction would exceed the harm suffered by the opposing party if the injunction issued, and (4) an injunction would not disserve the public interest." Johnson &...