Voice of The Arab World Inc. v. Mdtv Med. News Now Inc.

• Citation: 98 U.S.P.Q.2d 1822,645 F.3d 26
• Decision Date: 27 May 2011
• Docket Number: No. 10–1396.,10–1396.
• Parties: VOICE OF THE ARAB WORLD, INC., Plaintiff, Appellant,v.MDTV MEDICAL NEWS NOW, INC., Defendant, Appellee.Zagloul E. Ayad; Massachusetts Eye and Ear Infirmary; Boston Eye Group; Next Step Prosthetics; Boston Public Health Commission, Third Party Defendants.
• Court: United States Courts of Appeals. United States Court of Appeals (1st Circuit)

645 F.3d 26
98 U.S.P.Q.2d 1822

VOICE OF THE ARAB WORLD, INC., Plaintiff, Appellant,
v.
MDTV MEDICAL NEWS NOW, INC., Defendant, Appellee.Zagloul E. Ayad; Massachusetts Eye and Ear Infirmary; Boston Eye Group; Next Step Prosthetics; Boston Public Health Commission, Third Party Defendants.

No. 10–1396.

United States Court of Appeals, First Circuit.

Heard Dec. 9, 2010.Decided May 27, 2011.

[645 F.3d 28]

Robert B. Foster, with whom Rackemann, Sawyer & Brewster, P.C., was on brief for appellant.Jeffrey H. Greger, with whom Jeffrey H. Greger, PC and Lowe Hauptman Ham & Berner LLP, was on brief for appellee.Before TORRUELLA, BOUDIN, LIPEZ, Circuit Judges.TORRUELLA, Circuit Judge.

In this appeal, plaintiff-appellant Voice of the Arab World, Inc. (“VOAW”) challenges the district court's interlocutory order granting defendant-appellee MDTV Medical News Now, Inc.'s (“Medical News Now”) motion to preliminarily enjoin VOAW from the use, sale, or promotion of the mark “MDTV,” or formative versions of that mark on the Internet, in connection with medical-related informational or educational programming or services. Because we find that the district court abused its discretion in presuming that Medical News Now was likely to suffer irreparable harm in the absence of preliminary injunctive relief, we vacate the district court's preliminary injunction order and remand the case for further proceedings consistent with this opinion.

I. Facts and Procedural History

VOAW is a Massachusetts non-profit corporation whose alleged mission is to provide objective, current and accurate healthcare information to patients and physicians via radio, television, satellite broadcast and the Internet. It claims to supply information to citizens of Arab and Muslim countries about healthcare options available in the United States.

Medical News Now, on the other hand, describes itself as a medical news organization and producer of the nationally broadcasted television series “MDTV Medical News Now,” which the parties do not dispute has aired continuously since 1998.

A. First Use of the “MDTV” Mark in Commerce

The parties agree that Medical News Now began using the “MDTV” mark in commerce in January 1998 and has made continuous use thereof. However, Medical News Now disputes VOAW's assertion that the latter has made continuous use of the “MDTV” mark in commerce since 1989.

VOAW alleges that it first made use of the “MDTV” mark in the production of television programs from 1989 through the mid–1990s. Furthermore, it contends that in 1995 it began to make use of the mark in connection with its Internet website and has made continuous use ever since. Medical News Now, however, challenges these assertions and maintains that they are contradicted by the record. First, Medical News Now notes that, although VOAW's federal registration of the “MDTV” mark indicates that VOAW first used the mark in commerce in 1989, a sworn declaration signed by VOAW's President, Zagloul E. Ayad, on December 21, 1999—in connection with VOAW's application for state registration of the “MDTV” mark in Massachusetts—establishes that VOAW's first use of the “MDTV” mark anywhere was on March 7, 1999. Second, Medical News Now argues that VOAW's claim that it has been using the “MDTV” mark on the Internet since 1995 is belied by VOAW's own assertion that it registered the “mdtv” Internet domain names between November 4, 1998 and February 1, 1999.¹ Third, Medical News Now contends that the evidence

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in the record regarding VOAW's use of the “MDTV” mark prior to 1998—which consists primarily of certain e-mails and a declaration by Mr. Ayad—is limited and unconvincing. The district court agreed with Medical News Now and found that “evidence of any commercialization by VOAW prior to 1998 is either dubious, or worse, non-existent.” Voice of the Arab World, Inc. v. MDTV Med. News Now, Inc., No. 09–11505–GAO, 2010 WL 661048, at *3, 2010 U.S. Dist. LEXIS 16981, at *9–10 (D.Mass. Feb. 25, 2010).

B. Registration of the “MDTV” Mark

On October 9, 1998, Medical News Now filed applications with the United States Patent and Trademark Office (“USPTO”) to register the marks “MDTV” and “MDTV Medical News Now,” both in connection with certain commercial cable television broadcast and entertainment services. The USPTO issued registrations in favor of Medical News Now for the “MDTV” (No. 2,655,243) and “MDTV Medical News Now” (No. 3,081,061) marks on December 3, 2002 and April 18, 2006, respectively. Both registrations state that the marks were first used in commerce in January 1998.

On September 25, 2000, VOAW filed an application with the USPTO to register the “MDTV” mark in connection with providing the Arab and Muslim world with periodicals, information and educational services in the field of medicine via radio, television, satellite broadcast and the Internet. The USPTO initially refused VOAW's application, stating that Medical News Now's prior registration stood as a barrier. However, the USPTO later approved VOAW's application and issued a registration (No. 3,497,465) in its favor on September 9, 2008. ² It is unclear what the reasoning was behind the USPTO's initial rejection and later approval of VOAW's application to register the “MDTV” mark. Nevertheless, the district court found that Medical News Now's earlier registration has priority.

C. History of Delay in Seeking Injunctive Relief

On January 11, 2000, Medical News Now, through its counsel, sent VOAW a cease-and-desist letter threatening to bring a trademark infringement action against VOAW unless certain questions regarding the use of the “MDTV” mark were answered. The letter strongly urged VOAW to “select an alternative mark for [its] services so as to avoid even the possibility of confusion” and gave VOAW fifteen days to respond. After receiving the letter, VOAW did not cease to use the “MDTV” mark and Medical News Now took no legal action. Rather, as previously mentioned, later that year—on September 25, 2000—VOAW applied for federal registration of the “MDTV” mark.

In September 2001, Medical News Now offered to pay VOAW $300 per month for a banner advertisement or landing page on VOAW's website (at mdtv.com) that would direct Internet users to Medical News Now's own website (at mdtv.now.com). The parties, however, were unable to reach an agreement at that time.

Subsequently, in August 2002, Medical News Now, through its counsel, offered to enter into an agreement with VOAW whereby VOAW would have been required to, among other things, (1) withdraw its pending federal application for the “MDTV” mark, (2) allow Medical News

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Now's pending federal application to mature into registration and not challenge Medical News Now's rights to the mark, and (3) use its trade name “Voice of the Arab World” on the opening splash page or first page of all promotions or advertisements that used the “MDTV” mark. In exchange, Medical News Now offered to, among other things, (1) refrain from challenging VOAW's continued use under common law of the “MDTV” mark, and (2) pay VOAW a fee of $500 per month to rent use of the domain address “www. mdtv. com.” The parties, nevertheless, were unable to finalize this proposed agreement.

The parties did, however, later reach a verbal agreement in 2005 under which Medical News Now promised to pay $600 per month to VOAW for the latter to host a banner advertisement (on its website) that would refer interested users to Medical News Now's own website.³ However, Medical News Now soon lost interest in the banner referral—apparently because it produced little or no traffic—and in 2006 requested that VOAW discontinue it. The record shows that the parties' relationship soured further during this time. While VOAW attempted to collect allegedly due and unpaid banner rental fees, Medical News Now asserted that VOAW misleadingly induced it into renting the banner by providing false information concerning the expected traffic.

On September 29, 2008, Medical News Now filed a petition in the USPTO to cancel VOAW's registration (No. 3,497,465) of the “MDTV” mark. This proceeding is now pending before the Trademark Trial and Appeal Board.

Subsequently, in August 2009, VOAW made changes to the text appearing on at least one of its static webpages by (1) declaring a wider scope of intended services, (2) providing Internet links to certain medical entities, and (3) creating subdomain names. The district court found significant that “the revised version of the websites deleted any limiting references to the ‘Muslim and Arab world.’ ” Voice of the Arab World, Inc., 2010 WL 661048, at *2, 2010 U.S. Dist. LEXIS 16981, at *8.

On August 15, 2009, Medical News Now sent VOAW a letter threatening to file an action for trademark infringement and domain name cybersquatting unless VOAW agreed to transfer the “mdtv” domain names to Medical News Now in exchange for a nominal sum. Thereafter, on September 10, 2009, VOAW filed an action in the district court seeking declaratory judgment (1) that it had a right to use and register the “MDTV” mark, and (2) that its activities did not infringe upon Medical News Now's purported rights in the “MDTV” mark, or constitute domain name cybersquatting.

Medical News Now responded on November 24, 2009, by bringing counterclaims against VOAW for trademark infringement, unfair competition and cybersquatting. In addition, on November 25, 2009, Medical News Now moved to preliminarily enjoin VOAW from using the “MDTV” mark. On February 25, 2010, the district court granted Medical News Now's motion and issued an order preliminarily enjoining VOAW from the use, sale or promotion of the “MDTV” mark or formative versions thereof on the Internet, in connection with medical-related information or educational programming or services. VOAW appeals the district court's preliminary injunction order.⁴

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II. Standard of Review

On appeal, we review the district court's grant of a...