Times Mirror Magazines v. Las Vagas Sports News

• Decision Date: 13 January 2000
• Docket Number: No. 99-1299,99-1299
• Citation: 212 F.3d 157
• Parties: (3rd Cir. 2000) TIMES MIRROR MAGAZINES, INC. v. LAS VEGAS SPORTS NEWS, L.L.C., d/b/a LAS VEGAS SPORTING NEWS, Appellant. Argued:
• Court: U.S. Court of Appeals — Third Circuit

Page 157

212 F.3d 157 (3rd Cir. 2000)

TIMES MIRROR MAGAZINES, INC. v. LAS VEGAS SPORTS NEWS, L.L.C., d/b/a LAS VEGAS SPORTING NEWS, Appellant.

No. 99-1299

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

Argued: January 13, 2000

Filed April 28, 2000

Amended May 3, 2000

On Appeal from the United States District Court for the Eastern District of Pennsylvania (D.C. No. 98-cv-05768) District Judge: Honorable Bruce W. Kauffman

[Copyrighted Material Omitted]

[Copyrighted Material Omitted]

Malcolm J. Gross (Argued) Gross, McGinley, LaBarre & Eaton Allentown, PA Attorney for Appellee

Diane S. Danoff (Argued) Dechert, Price & Rhoads Philadelphia, PA Attorney for Appellant

Before: Alito, Barry and Aldisert, Circuit Judges.

OPINION OF THE COURT

ALDISERT, Circuit Judge.

In 1886 the phrase "The Sporting News" was granted federal trademark protection and since that time it has been the banner headline of a weekly publication entitled The Sporting News. The mark is now owned by its publisher, Times Mirror Magazines, Inc. This appeal requires us to decide if Times Mirror was entitled to a preliminary injunction enjoining a publisher from using the name Las Vegas Sporting News.

Applying the relatively new Federal Trademark Dilution Act of 1995, 15 U.S.C. S 1125(c) ("FTDA" or "Act"), the district court issued the injunction against Las Vegas Sports News, L.L.C., d/b/a Las Vegas Sporting News ("LVSN"), from using the name on its weekly sports-betting publication. The court concluded that Times Mirror was likely to succeed on the merits of its dilution claim against LVSN, because the mark was "famous" in its niche market and LVSN's use of the title on its publication diluted the Times Mirror's mark by blurring its distinctiveness.

The district court had jurisdiction over the dilution claims pursuant to 15 U.S.C. S 1121(a) and 28 U.S.C. S 1338. We have jurisdiction pursuant to 28 U.S.C. S 1292(a)(1). This appeal by LVSN was timely filed under Rule 4, Federal Rules of Appellate Procedure.

LVSN contends that the district court erred by granting Times Mirror preliminary injunctive relief because Times Mirror failed to establish a likelihood of success on the merits of its dilution claim or immediate irreparable harm. We must decide whether the district court erred by holding that (a) the mark "The Sporting News" was famous in the sports periodicals market; (b) LVSN's use diluted the strength of Times Mirror's mark by blurring its distinctiveness and (c) Times Mirror's 15-month delay in bringing suit did not preclude a finding that LVSN's use would immediately cause irreparable harm to Times Mirror.

In reviewing the grant or denial of a preliminary injunction, we consider the following:

1. The law has entrusted the power to grant or dissolve an injunction to the discretion of the trial court in the first instance, and not to the appellate court.

2. Unless the trial court abuses that discretion, commits an obvious error in applying the law or makes a serious mistake in considering proof, the appellate court must take the judgment of the trial court as presumptively correct.

3. This limited review is necessitated because the grant or denial is almost always based on an abbreviated set of facts, requiring a delicate balancing of the probabilities of ultimate success at final hearing with the consequences of immediate irreparable injury which could possibly flow from the denial of preliminary relief.

4. In exercising its limited review of the grant or denial of preliminary injunctive relief, the appellate court asks: (a) Did the movant make a strong showing that it is likely to prevail on the merits? (b) Did the movant show that, without such relief, it would be irreparably injured? (c) Would the grant of a preliminary injunction substantially have harmed other parties interested in the proceedings? (d) Where lies the public interest?

5. The applicant for a preliminary injunction bears the burden of establishing that a right to such injunctive relief and that irreparable injury will result to him of it is not granted. Moreover, we have emphasized the elementary principle that a preliminary injunction shall not issue except under a showing of irreparable injury.

A.O. Smith Corp. v. FTC, 530 F.2d 515, 525 (3d Cir. 1976); see Loretangeli v. Critelli, 853 F.2d 186, 193 (3d Cir. 1988).

I.

The Sporting News provides its readers with information on baseball, basketball, football and hockey, and has a weekly circulation of approximately 540,000 in the United States and Canada. The Sporting News does not provide any information on gambling, because Times Mirror "believe[s] that there is a portion of the population that is adamantly opposed to gambling and that they would not look favorably on any of [its] products if they thought [the magazine was] promoting gambling in any way." D. Ct. Op. at 2 (alteration in original). The magazine is advertised on television, in direct mail solicitations, in promotions and occasionally on the radio. It is typically sold for $2.99, but nine special content issues are sold each year for $3.99. Over the last several years, Times Mirror has invested millions of dollars in The Sporting News in an attempt to improve the quality of its magazine and to increase readership.

LVSN publishes Las Vegas Sporting News, which contains articles, editorials and advertisements on sports wagering "for the sports gaming enthusiasts or individuals that like to take a risk." App. at 41 (Testimony of LVSN publisher, Dennis Atiyeh). Las Vegas Sporting News is published 45 times a year and generally has a circulation of 42,000, but some special editions have had a circulation of up to 100,000. The publication is sold for $2.99 at several hundred newsstands across the country, but most copies are given away in gambling casinos free of charge.

In 1997, LVSN publisher Dennis Atiyeh changed the name of his publication from Las Vegas Sports News to Las Vegas Sporting News. The publisher says that he changed the publication's title for two reasons: (1) the previous publisher of Las Vegas Sports News had a poor reputation, having fallen into disrepute with gambling casinos and (2) the term "sporting" more accurately reflected the publication's content, because the publication was a "sports gaming" publication, and not purely a "sports publication." D. Ct. Op. at 3. Atiyeh admits that at the time he changed the name of his publication, he was familiar with Times Mirror's publication The Sporting News. Since the 1997 name change to Las Vegas Sporting News, circulation of the publication has increased, but not substantially.

Times Mirror first learned that LVSN was publishing Las Vegas Sporting News in August 1997. On September 24, 1997, Times Mirror sent LVSN a cease and desist letter, which read in part:

It has recently come to my attention that your company is marketing a sports magazine entitled Las Vegas Sporting News. Apparently, this is a relatively recent change, since the masthead page of your magazine makes reference to Las Vegas Sports News, stating, in part, that, "Las Vegas Sports News . . . is published weekly . . . ."

. . . . It would appear that your company is attempting to unlawfully appropriate the good will that is associated with our federally registered trademark.

In view of the likelihood of consumer confusion, we hereby demand that you (1) immediately cease and desist from any further use of the term "Las Vegas Sporting News," and (2) select a name to identify your product that is not confusingly similar to our "The Sporting News" trademark.

App. at 263-264 (citations omitted).

LVSN had not ceased using the phrase "Sporting News" in connection with its weekly publication. In October 1998, after settlement negotiations between Times Mirror and LVSN proved unsuccessful, Times Mirror retained Glenn Hauze, a private investigator in Pennsylvania, "to gain as much information as possible regarding the availability of the Las Vegas Sporting News," in anticipation of litigation. App. at 31. Hauze began his investigation by visiting three newsstands in or around Lehigh Valley, Pennsylvania. The first newsstand he visited was in Plumsteadville, and it carried both The Sporting News and Las Vegas Sporting News. Las Vegas Sporting News "was up on the shelf with the other sporting magazines," but The Sporting News "was down amongst the tabloids." D. Ct. Op. at 6. The following day, Hauze found copies of Las Vegas Sporting News for sale at newsstands in Allentown and Quakerville. At the Allentown newsstand, Las Vegas Sporting News and The Sporting News were displayed within inches of each other in a bay window in front of the store, along with a large number of other sporting type publications.

John Kastberg, vice-president of Times Mirror's The Sporting News, conducted his own investigation in December 1998, during which he visited three newsstands in New York City:

I went to a newsstand in Penn Station which is a train terminal in New York, I went to Barnes & Noble in New York and I went to a newsstand in Grand Central Terminal which is another train station in New York. . . . [W]hen I went to Penn Station I asked the guy "Do you have the Las Vegas Sporting News," and he handed me the Times Mirror Sporting News. . . . I went to the Barnes & Noble, asked the same question, got Times Mirror Sporting News and the same thing happened at Grand Central. All three times I was handed the Times Mirror Sporting News when I asked for Las Vegas Sporting News.

App. at 24-25.

Two weeks after Hauze's investigation, Times Mirror filed a complaint in district court, charging LVSN with infringing Times Mirror's registered mark in violation of section 32 of the Lanham Act, 15 U.S.C. S 1114(1); with false designation of origin in violation of section 43(a) of the Lanham Act, 15 U.S.C. S 1125(a); with trademark dilution in violation of section 43(c) of the Lanham Act, 15 U.S.C. S 1125(c); and with common law...