KENNETH M. KARAS, District Judge:
Plaintiff New World Solutions, Inc. ("NWS" or "Plaintiff") brings this Action against Defendant NameMedia, Inc. ("NameMedia" or "Defendant").
The Parties have filed Cross Motions for Summary Judgment. (See Dkt. Nos. 68, 76.) Specifically, NameMedia moves for
In this Action, NWS describes itself as a "staffing company" whose employees "[t]ypically" provide technology consulting services. (Videotaped Examination of David Shaun Neal ("Neal Tr.") 21-22.)
In the First Amended Complaint, Plaintiff alleges that it is a Wyoming Corporation that "provides business services to large, multinational corporations worldwide and has done so since June of 2004." (FAC ¶¶ 3, 7.) It is undisputed, however, that "[t]here is no documentary evidence in the record that any purported predecessor-in-interest to Plaintiff existed prior to 2007." (Def.'s Rule 56.1 Statement of Material Facts Not in Dispute in Supp. of Its Mot. for Summ. J. ("Def.'s 56.1") ¶ 29 (Dkt.
Defendant contends that "[t]here is no evidence identifying ownership of either the 2007 Delaware Entity or the 2010 Wyoming Entity, or that any assets were transferred from the 2004 `d/b/a/' to the 2007 Delaware Entity, or from the 2007 Delaware Entity to the 2010 Wyoming Entity." (Def.'s 56.1 ¶ 35.) Plaintiff disputes this. (Pl.'s 56.1 ¶ 35.) Plaintiff's account of its history and activities — which is strongly contested by Defendant — proceeds as follows: beginning in 2004, a "d/b/a" run jointly by Neal and Coyne (the "d/b/a entity") "performed ... services" using the name "New World Solutions." (See Neal Tr. 27-28; see also Decl. of David Shaun Neal in Supp. of Pl.'s Mem. of Law in Opp'n to Def.'s Mot. for Summ. J. and in Supp. of Pl.'s Mem. of Law for Summ. J. ("Neal Decl.") ¶ 40 (Dkt. No. 79) (stating that between 2004 and the date of his declaration, Neal was employed full time at NWS).) Coyne and Neal split the revenues from the d/b/a entity. (Neal Tr. 91.) Although Coyne claims that his "business activities with ... Neal commenced in early 2004 and continued until late 2012, [when he] transferred all of [his] interest in [NWS] to ... Neal," he cites to nothing in the record to support this assertion, and in particular that he had business activities with Neal in 2004. (Decl. of Robert F. Coyne in Supp. of Pl.'s Mem. of Law in Opp'n to Def.'s Mot. for Summ. J. and in Supp. of Pl.'s Mem. of Law for Summ. J. ("Coyne Decl. I") ¶ 10 (Dkt. No. 78).)
NWS has no documentary evidence that establishes the existence of the d/b/a entity, or its promotional activities, services, or revenues, allegedly because Neal had a "simultaneous failure of the primary and the secondary hard drive" on his computer in 2007 and because Plaintiff was unable to locate any documents relating to the d/b/a entity or its activities by any other means. (See Neal Tr. 28-29, 32, 37-38, 143-45, 147-49, 159.) However, Neal testified that the d/b/a entity engaged in marketing activities, which consisted of (1) "one-on-one sales techniques," which means that Coyne and Neal "cold call[ed]" and e-mailed potential clients, and (2) sending promotional postcards to a mailing list obtained from a company called American Business Lists. (Id. at 31-32.) Neal also testified that he recalled three clients of the d/b/a entity in 2004, namely "Merrill Lynch ... a real estate company in Arizona ... [and] an institutional foreign exchange trader." (Id. at 36-37.) Moreover, although Neal stated in his deposition that NWS's revenue figures were "a few hundred thousand" in 2004, "over a million," in 2005-06, and "about a million and a half to 2 million a year" in 2007-12, Neal has testified that he does not have any documents to support
The "original legal entity" for NWS was created on March 26, 2007, when Coyne allegedly incorporated New World Solutions, Inc. as a Delaware C Corporation. (Neal Tr. 27; see also Schwimmer Decl. I Ex. 11; Coyne Decl. I ¶ 3; id. at Ex. 1.) Coyne dissolved the 2007 Delaware Entity on July 12, 2010 and transferred all of its assets and liabilities, including all of the rights to the trade name New World Solutions, to the 2010 Wyoming Entity, which was formed on May 25, 2010. (Coyne Decl. I ¶¶ 5, 7-9; id. at Exs. 2-3.) Coyne and Neal each owned 50% of the Delaware and Wyoming entities, but on December 6, 2012, Coyne transferred to Neal the entirety of his interest in NWS so that, at present, Neal is the "managing partner" and "sole shareholder" of NWS. (Neal Decl. ¶¶ 1-2; Coyne Decl. I ¶¶ 4, 6, 10.) Coyne does not cite to anything in the record to support this transfer. Neal states that he "determined that [he] possess[es] evidence of ownership of New World Solutions, Inc[.] (DE), New World Solutions, Inc[.] (WY)[,] and the transfers of ownership between [himself] and ... Coyne which occurred during the relevant time of this [A]ction." (Neal Decl. ¶ 41.) Neal also states that he "testified that ... Coyne possesses th[e]se records, however [he does] not believe that any request was made by [D]efendant to ... Coyne for any records." (Id. ¶ 41.) In other words, there yet again are no documents that support Coyne's or Neal's statements.
NameMedia is a Delaware Corporation with headquarters in Waltham, Massachusetts. (FAC ¶ 4.) NameMedia offers a marketplace for purchase and sale of domain names by and for others and also purchases and sells domain names for its own accounts. (Def.'s 56.1 ¶ 72; Pl.'s 56.1 ¶ 72; Schwimmer Decl. I ¶ 42; Decl. of Erik S. Zilinek, Esq. in Supp. of Def.'s Mot. for Summ. J. ("Zilinek Decl. I") ¶ 5 (Dkt. No. 70).) Although NameMedia states that its "policy is to register and maintain only those domain names that incorporate common words or phrases, descriptive terms, and/or words to which NameMedia considers no single party has exclusive rights, if any," (Def.'s 56.1 ¶ 73; Zilinek Decl. I ¶ 3), Plaintiff disputes this, noting that despite its requests, Defendant provided no evidence of this policy, (Pl.'s 56.1 ¶ 73). NameMedia "monetizes" some of its domain names by displaying Google AdWords and advertisements, links to Google ads on a holding page, and solicitations for offers to purchase its domain names. (Def.'s 56.1 ¶ 74; Pl.'s 56.1 ¶ 74; Zilinek Decl. I ¶ 6; Schwimmer Decl. I ¶ 43.) NameMedia's website states: "We start with our inventory of more than 900,000 domains — the single largest portfolio of domain names for sale." (Pl.'s 56.1 ¶ 81; Def.'s Rule 56.1(B) Counter Statement to Pl.'s Rule 56.1(A) Statement of Material Facts Not in Dispute in Supp. of Pl.'s Cross-Mot. for Summ. J. ("Def.'s Reply 56.1") ¶ 81 (Dkt. No. 92); Neal Decl. ¶ 44; id. at Ex. 19.)
According to Defendant it "uses a method known as `robot exclusion' to prevent indexing of its holding pages by search engines." (Def.'s 56.1 ¶¶ 9, 75; Zilinek Decl. I ¶ 4.) Plaintiff disputes this and claims, instead, that Defendant encourages search engines to crawl its sites. (Pl.'s 56.1 ¶¶ 9, 75, 80; Neal Decl. ¶¶ 7-11.) Defendant, in turn, claims that it would be cost prohibitive for NameMedia to crawl for keywords in the manner and for the purpose that Plaintiff alleges and would put it out of business. (Def.'s Reply 56.1 ¶ 80.) Plaintiff further points out that there is no evidence in the record to establish that Defendant conducts any bona fide business in the name of New World Solutions or in the name of the approximately 1,000,000 other
On March 26, 2005, NameMedia registered the Domain Name. (Def.'s 56.1 ¶ 7; Pl.'s 56.1 ¶ 7; Schwimmer Decl. I ¶ 3; id. at Ex. 1.) When NameMedia registered the Domain Name, it was unaware of NWS, (Def.'s 56.1 ¶ 8; Pl.'s 56.1 ¶ 8; Zilinek Decl. I ¶ 9), and indeed it is undisputed that the first time NameMedia learned of NWS's existence was on June 28, 2010, when Neal contacted NameMedia seeking a price quote for the Domain Name, (Def.'s 56.1 ¶ 10; Pl.'s 56.1 ¶ 10; Zilinek Decl. I ¶ 11). NameMedia claims that "in approximately 2006, [it] searched its entire portfolio of nearly one million domain names to ensure that it had not registered domain names that infringed upon any third party's exclusive rights in or to words or phrases that were incorporated into said domain names," and that the search "did not identify any party who could assert rights in or to the NEW WORLD SOLUTIONS mark." (Def.'s 56.1 ¶ 12; Zilinek Decl. I ¶ 9.) Plaintiff disputes this, explaining that NameMedia "has failed to enter any evidence into the record of any such `search' it ever performed and has failed to specify what methodology was applied and how it determined that the mark newworldsolutions was noninfringing." (Pl.'s 56.1 ¶ 12; Kossar Decl. ¶ 9.)
Moreover, while NameMedia maintains that it did not register the Domain Name with the intent to disrupt NWS's business, to keep NWS from having a domain name that incorporates its purported trademark, or to confuse customers seeking to find NWS's website, (Def.'s 56.1 ¶ 11; Zilinek Decl. I ¶ 10), Plaintiff claims that NameMedia employs "optimization" of its domain names "specifically designed to divert traffic and confuse consumers," (Pl.'s 56.1 ¶ 11; Kossar Decl. ¶ 4; Neal Tr. 119-29, 325-336). The Parties do not dispute that "[c]urrently, as well as at all times since NameMedia registered the Domain Name, the website to which the Domain Name resolves displays keyword advertisements." (Def.'s 56.1 ¶ 12; Pl.'s 56.1 ¶ 12.) Plaintiff also points out that while the record is devoid of any proof that Defendant provides any bona fide goods or services in relation to "Technology outsourcing," "Manila outsourcing," or "technology consulting" under the trade name New World Solutions, on June 29, 2012, the website www.newworldsolutions.com displayed those phrases. (Pl.'s 56.1 ¶¶ 85-86; Neal Decl. ¶ 5; id. at Ex. 2; Kossar Decl. ¶ 11.) Defendant does not dispute that its website contained these phrases, but does dispute that it does not offer any of those services. (Def.'s Reply 56.1 ¶¶ 85-86.)
Finally, Plaintiff alleges that "the sole purpose of the registration of the [D]omain [N]ame ... is to divert traffic to the website of ... Defendant." (Def.'s 56.1 ¶ 24; Pl.'s 56.1 ¶ 24; FAC ¶ 16.) Neal testified that after he "started to dig," it led him to say "oh, [Defendant has] this policy where they look at [NWS], they go to Google or Alta Vista or whatever and find the resulting websites that are top hits for [NWS], and then they go through those links and go to those websites and grab the key words off those websites and put those key words on their own websites." (Neal Tr. 331-32.) Defendant attempts to summarize
NWS first learned of NameMedia on or about June 21, 2007. (Def.'s 56.1 ¶ 13; Pl.'s 56.1 ¶ 13; Schwimmer Decl. I ¶ 9; Pl.'s Resps. to Def.'s First Set of Interrogs. No. 3.) On June 28, 2010, Neal contacted a NameMedia salesperson for the first time, seeking a price quote for the Domain Name. (Def.'s 56.1 ¶ 14; Pl.'s 56.1 ¶ 14; Zilinek Decl. I ¶ 11.) That same day, NameMedia responded by e-mail to Neal, informing him that the Domain Name was for sale at $2,588.00. (Def.'s 56.1 ¶ 15; Pl.'s 56.1 ¶ 15; Zilinek Decl. I ¶ 12; id. at Ex. B.) Neal did not respond to NameMedia's email. (Def.'s 56.1 ¶ 16; Pl.'s 56.1 ¶ 16; Zilinek Decl. I ¶ 13.)
Approximately four hours after NameMedia e-mailed Neal its price quote for the Domain Name, Neal filed an application with the United States Patent and Trademark Office (the "USPTO") to register the Mark in the Principal Register. (Def.'s 56.1 ¶ 16; Pl.'s 56.1 ¶ 16; Zilinek Decl. I ¶ 13; id. at Ex. C.) In its June 28, 2010 Application to the USPTO, NWS described the services it provides as "[c]omputer hardware and software consulting services; [i]nformation technology consultation; [s]ervices for maintenance of computer software; [and] [s]oftware design and development," and stated that its first use of the Mark, and its first use of the Mark in commerce, occurred "[a]t least as early as [June 21, 2007]." (Schwimmer Decl. I Ex. 18.) On July 27, 2010, Neal e-mailed NameMedia, stating that "New World Solutions, LLC" had "filed for a Trademark for" the NWS Mark, had used the Mark "in trade ... for a number of years," and that, upon "final registration" of the Mark, NWS would bring an action against NameMedia for injunctive and declaratory relief but would "agree to settle th[e] matter out of court for $200 upon transference of the domain to [NWS]." (Def.'s 56.1 ¶ 17; Pl.'s 56.1 ¶ 17; Zilinek Decl. I ¶ 14; id. at Ex. D.)
On February 15, 2011, the USPTO issued the Mark Registration to Plaintiff. (Def.'s 56.1 ¶ 18; Pl.'s 56.1 ¶ 18; see also Pl.'s Resps. to Def.'s First Set of Interrogs. No. 10; Zilinek Decl. I ¶ 15; id. at Ex. E.) The USPTO Registration Certificate for "New World Solutions" lists the same services as NWS's application, and lists June 21, 2007 as the date of the first use of the Mark and the date of the first use of the Mark in commerce. (Def.'s 56.1 ¶ 18; Pl.'s 56.1 ¶ 18; see also Zilinek Decl. I ¶ 15; id. at Ex. E.)
On March 18, 2011 — approximately one month after the USPTO issued NWS's Registration — Coyne emailed NameMedia stating that he was counsel for Plaintiff and asserting that NameMedia's registration of the Domain Name infringed on NWS's service mark. (Def.'s 56.1 ¶ 20; Pl.'s
In its 56.1 Statement, under the heading "`New World Solutions' is a Common Business Name, Trademark, Service Mark[,] and/or Domain Name," Defendant points out that: (i) on February 1, 1996, a New World Solutions, Inc. was incorporated in the State of New York, (Def.'s 56.1 ¶ 59; Pl.'s 56.1 ¶ 59; Schwimmer Decl. I ¶ 8; id. at Ex. 6), (ii) there is a company named New World Solutions of Fairfax, VA, which has a website at www.new-world solutions.com, (Def.'s 56.1 ¶ 60; Pl.'s 56.1 ¶ 60), (iii) there is a company named New World Solutions, Inc. of Huntsville, AL, which has a website at www.newworldsol. com, (Def.'s 56.1 ¶ 61; Pl.'s 56.1 ¶ 61), (iv) there is a company named New World Solutions of Smithtown, NY, which has a website at www.newws.com, (Def.'s 56.1 ¶ 62; Pl.'s 56.1 ¶ 62), (v) there is a company named New World Solutions of West Kill, NY, (Def.'s 56.1 ¶ 63; Pl.'s 56.1 ¶ 63), and (vi) there is a company named New World Solutions, LLC, (Def.'s 56.1 ¶ 64; Pl.'s 56.1 ¶ 64).
On April 11, 2011, NWS filed suit against NameMedia in New York State Supreme Court, (Kossar Decl. Ex. 1), and NameMedia removed the Action to this Court on April 22, 2011, (Dkt. No. 1). On April 3, 2012, NWS filed an Amended Complaint, asserting four claims against NameMedia: (1) federal trademark dilution in violation of 15 U.S.C. § 1125(c), (FAC ¶¶ 22-27); (2) cybersquatting in violation of 15 U.S.C. § 1125(d), (id. ¶¶ 28-33); (3) deceptive acts and false advertising under NYGBL §§ 349 and 350, (id. ¶¶ 34-38); and (4) trademark dilution under NYGBL § 360-l, (id. ¶¶ 39-44). In turn, NameMedia asserted two counterclaims against NWS, seeking (1) a declaratory judgment of the invalidity and unenforceability of the Mark Registration pursuant to 15 U.S.C. § 1119, (Def.'s Counterclaims ¶¶ 7-22), and (2) a declaratory judgment that NWS is liable to NameMedia "for all [] damages incurred as a result of Plaintiff's meritless enforcement of [the] [R]egistration," pursuant to 15 U.S.C. § 1120, (id. ¶¶ 23-30). In addition, NameMedia requests an Order pursuant to 15 U.S.C. § 1117(a) declaring this matter to be an "exceptional case," thereby entitling NameMedia to litigation expenses. (Id. at Prayer for Relief.)
Pursuant to the Motion Scheduling Order entered by the Court on April 18, 2013, (Dkt. No. 61), Defendant filed its Motion for Summary Judgment and accompanying papers on May 24, 2013, (Dkt. Nos. 68-72), and Plaintiff filed its Cross-Motion for
NameMedia moves to strike several exhibits and portions of declarations that Plaintiff submitted in its Motion for Summary Judgment. (See Def.'s Notice of Mot. To Exclude and Strike Evid. Pursuant to Fed. R. Civ. P. 37 and 56 (Dkt. No. 87).) Plaintiff, in turn, seeks to strike certain evidence submitted in connection with Defendant's Motion to Strike. (Pl.'s Notice of Cross-Mot. to Strike (Dkt. No. 94).)
"Because a decision on the motion to strike may affect [a] movant's ability to prevail on summary judgment, it is appropriate to consider the Motion[s] [T]o Strike prior to the [Parties'] Motion[s] for Summary Judgment." Century Pac., Inc. v. Hilton Hotels Corp., 528 F.Supp.2d 206, 213 (S.D.N.Y.2007) (alteration and internal quotation marks omitted), aff'd, 354 Fed. Appx. 496 (2d Cir.2009).
Rule 26(a) of the Federal Rules of Civil Procedure requires parties to provide, among other things, "the name ... of each individual likely to have discoverable information ... that the disclosing party may use to support its claims or defenses, unless the use would be solely for impeachment." Fed. R. Civ. P. 26(a)(1)(A)(i). Moreover, parties must provide "a copy — or a description by category and location — of all documents, electronically stored information, and tangible things that the disclosing party has in its possession, custody, or control and may use to support its claims or defenses, unless the use would be solely for impeachment." Fed. R. Civ. P. 26(a)(1)(A)(ii). Under this Rule, "use" includes any use "to support a motion, or at trial." Emmpresa Cubana Del Tabaco v. Culbro Corp., 213 F.R.D. 151, 159 (S.D.N.Y.2003) (internal quotation marks omitted); see also Fleet Capital Corp. v. Yamaha Motor Corp., U.S.A., No. 01-CV-1047, 2002 WL 31108380, at *1 (S.D.N.Y. Sept. 23, 2002) (same).
Fed. R. Civ. P. 37(c)(1). "Where ... the nature of the alleged breach of a discovery obligation is the non-production of evidence, a district court has broad discretion in fashioning an appropriate sanction...." Residential Funding Corp. v. DeGeorge Fin. Corp., 306 F.3d 99, 107 (2d Cir.2002); see also Markey, 2015 WL 5027522, at *16 (same). "Rule 37(c)(1) is intended to prevent the practice of `sandbagging' an opposing party with new evidence." Capitol Records, LLC v. Escape Media Grp., Inc., No. 12-CV-6646, 2015 WL 1402049, at *21 (S.D.N.Y. Mar. 25, 2015) (internal quotation marks omitted). Moreover, sanctions are appropriate under Federal Rule of Civil Procedure 37(d) when a party fails to attend his or her own deposition. See In re Durand, No. 07-CV-5037, 2008 WL 4282601, at *5 (E.D.N.Y. Sept. 16, 2008).
"The party seeking Rule 37 sanctions bears the burden of showing that the opposing party failed to timely disclose information." Markey, 2015 WL 5027522, at *16 (internal quotation marks omitted). To determine whether preclusion is warranted under Rule 37, a court must consider "(1) the party's explanation for the failure to comply with the disclosure requirement; (2) the importance of the testimony of the precluded witnesses; (3) the prejudice suffered by the opposing party as a result of having to prepare to meet the new [evidence]; and (4) the possibility of a continuance." Design Strategy, Inc. v. Davis, 469 F.3d 284, 296 (2d Cir.2006) (alterations and internal quotation marks omitted) (quoting Patterson v. Balsamico, 440 F.3d 104, 117 (2d Cir.2006)) (the "Patterson Factors"); see also Richmond v. Gen. Nutrition Ctrs. Inc., No. 08-CV-3577, 2012 WL 762307, at *6 (S.D.N.Y. Mar. 9, 2012) (same). Moreover, "although a `bad-faith' violation of ... Rule 26 is not required in order to exclude evidence pursuant to Rule 37, it can be taken into account as part of the party's explanation for its failure to comply." Design Strategy, 469 F.3d at 296; see also S.E.C. v. CKB168 Holdings, Ltd., No. 13-CV-5584, 2015 WL 4872553, at *4 (E.D.N.Y. Jan. 7, 2015) (same), adopted in part by 2015 WL 4872555 (E.D.N.Y. Aug. 12, 2015). Finally, it is worth noting that preclusion is not a mandatory sanction. See Design Strategy, 469 F.3d at 297-98. Indeed, it bears emphasizing that "[p]reclusion is a `harsh remedy' that `should be imposed only in rare situations.'" CKB168 Holdings, Ltd., 2015 WL 4872553, at *4 (quoting Izzo v. ING Life Ins. & Annuity Co., 235 F.R.D. 177, 186 (E.D.N.Y.2005)).
Federal Rule of Civil Procedure 56(c)(4) requires that, in a summary judgment motion, an "affidavit or declaration used to support or oppose a motion must be made on personal knowledge, set out facts that would be admissible in evidence, and show that the affiant or declarant is
Rule 56(e), in turn, provides that "[i]f a party fails to properly support an assertion of fact ... the court may: (1) give an opportunity to properly support... the fact; (2) consider the fact undisputed for purposes of the motion; (3) grant summary judgment if the motion and supporting materials ... show that the movant is entitled to it; or (4) issue any other appropriate order." Similarly, Rule 56.1(d) of the Local Rules of the United States District Courts for the Southern and Eastern Districts of New York ("Local Rule 56.1") requires that each assertion made by the movant or opponent in their Rule 56.1 Statements "must be followed by citation to evidence which would be admissible." Accordingly, "only admissible evidence" need be considered on summary judgment; in addition, the "principles governing admissibility of evidence do not change on a motion for summary judgment." Porter v. Quarantillo, 722 F.3d 94, 97 (2d Cir.2013) (alteration and internal quotation marks omitted). Moreover, if a party fails to properly support a statement by an adequate citation to the record, the Court may properly disregard that assertion. See Holtz v. Rockefeller & Co., 258 F.3d 62, 73-74 (2d Cir.2001) (noting that "district courts in the Southern and Eastern Districts of New York have interpreted current Local Rule 56.1 to provide that where there are no citations or where the cited materials do not support the factual assertions in the [s]tatements, the [c]ourt is free to disregard the assertion" and collecting cases (alteration and internal quotation marks omitted)).
NameMedia moves to preclude Coyne's declaration (the "Coyne Declaration") in its entirety. (Def.'s Mem. in Supp. of Def.'s Mot. to Exclude and Strike Pursuant to Fed. R. Civ. P. 37 and 56 ("Def.'s Strike Mem.") 15 (Dkt. No. 90).) NameMedia argues that the Court should, pursuant to Rules 37(b)(2) and 37(d), strike all evidence submitted by Coyne because he failed to appear for his deposition and failed to respond to NameMedia's requests to reschedule that deposition.
Although precluding evidence is a "drastic remedy" that "should be exercised with caution," DVL, Inc. v. Gen. Elec. Co., 811 F.Supp.2d 579, 589 (N.D.N.Y.2010) aff'd sub nom. DVL, Inc. v. Niagara Mohawk Power Corp., 490 Fed.Appx. 378 (2d Cir.2012), the Court finds that precluding all evidence submitted by Coyne is warranted. NameMedia duly noticed Coyne for a deposition on October 12, 2012. (Decl. of Martin B. Schwimmer, Esq. in Supp. of Def.'s Mot. To Exclude and Strike Evid. Pursuant to Fed. R. Civ. P. 37 and 56 ("Schwimmer Decl. II") Ex. F (Dkt. No. 88).) By letter dated October 9, 2012, then-counsel for NWS informed counsel for NameMedia that "Mr. Coyne is in Manila and has been for some time; I will advise when I get more information on his return." (Schwimmer Decl. II Ex. G.) By letter dated October 15, 2012 — the close of fact discovery pursuant to the Court's Case Management and Scheduling Order, (see Dkt. No. 14; Dkt. (minute entry for Aug. 8, 2012)) — counsel for NameMedia wrote "[w]e understand from our discussion with you and ... Neal at his deposition on October [11, 2012] that ... Coyne's exact whereabouts, as well as the timing of his expected return to the United States, are both presently unknown. We further understand that you will advise us when ... Coyne returns to the United States. Until that time, we note that ... Coyne has failed to timely appear for a duly-noticed deposition. Please accept this letter as our formal reservation of rights concerning same." (Schwimmer Decl. II Ex. H.) There is no dispute that Coyne was never deposed. (See Def.'s Strike Mem. 7; Pl.'s Strike Mem. 2.)
Turning to whether preclusion of Coyne's evidence is warranted, the Court finds that the first factor — "the party's explanation for the failure to comply with the disclosure requirement," or in this case for his failure to appear for or reschedule
(Id. at unnumbered 2.) Contrary to the November Fax's representation, however, the evidence and Coyne's course of conduct in this Action shows that Coyne was intimately involved with NWS and this litigation. Coyne instituted this Action on behalf of NWS and, according to Neal's testimony, provided the content of the responses to at least some of NameMedia's interrogatories. (Neal Tr. 67.) Further, evidence submitted by NWS contradicts Coyne's characterization of his limited role and relevant knowledge — including, Neal's deposition testimony that Coyne and Neal were both "engaged in" and responsible for the alleged marketing and business activities of the d/b/a entity, (see id. at 31, 34), Coyne's declaration that he was a 50% owner of at least two of the NWS entities and was "associated with" and conducted business activities on behalf of NWS for eight years, (see Coyne Decl. I. ¶¶ 4, 6, 10, 12), and NWS's statement that "Coyne has knowledge regarding all claims which are the subject matter of the current litigation," (Pl.'s Resps. to Def.'s First Set of Interrogs. No. 18). Additionally, it is worth noting that the November Fax was sent over a month after discovery in this case closed and there is no evidence that NWS requested an extension of the final discovery deadline. Accordingly, the Court finds the representation that Coyne "clearly stated that he would make himself available for a deposition" to be disingenuous at best. (See Pl.'s Strike Mem. 2.)
Moreover, there is no evidence that Defendant received the November Fax. NameMedia asserts that it first received the fax on August 2, 2013, when Coyne submitted a copy in connection with NWS's briefing on the motions to strike. (Decl. of Martin B. Schwimmer, Esq. in Further Supp. of Def.'s Mot. To Exclude and Strike Pursuant to Fed. R. Civ. P. 37 and 56 and in Opp'n to Pl.'s Cross-Mot. To Strike
As to the second factor, although neither Party makes an explicit argument as to the relative importance of the Coyne Declaration or of the inability of Defendant to depose Coyne due to his failure to appear for a deposition before the close of discovery, (see Def.'s Strike Mem. 15-16; Pl.'s Strike Mem. 2), the importance of the Coyne Declaration and his absent deposition testimony are apparent. In his declaration, Coyne describes his involvement in creating and dissolving the 2007 Delaware Entity, creating the 2010 Wyoming Entity, his 50% ownership in both entities, his general involvement in NWS, and his business relationship with Neal. (See generally Coyne Decl. I.) Coyne attaches exhibits to support these statements. (See id.) This information is clearly relevant to the claims in this Action. Moreover, the importance of Defendant's ability to depose Coyne in light of this information is obvious. For similar reasons, the third factor — prejudice to NameMedia — weighs in favor of preclusion. NameMedia had no opportunity prior to the Motions for Summary Judgment to question Coyne about his assertions of fact in his declaration, including his statements that he and Neal conducted continuous business activities under the "New World Solutions" mark between 2004 and 2012, (see Coyne Decl. I ¶ 10), or his statements regarding the alleged continuity between the d/b/a, Delaware, and Wyoming entities, (see id. ¶¶ 3-9; id. at Exs. 1-3). The third Patterson factor thus cuts strongly in favor of precluding evidence submitted by Coyne. See DVL, Inc., 811 F.Supp.2d at 591 (granting a motion to strike expert declarations submitted after the close of discovery because "[a]dmitting the ... [d]eclarations for the purpose of the [c]ourt's determination of the various summary judgment [m]otions would greatly prejudice the [d]efendants").
Turning to the fourth factor, NameMedia argues that "because the parties are in the middle of the current summary judgment briefing schedule, there is no `possibility of a continuance.'" (Def.'s Strike Mem. 16 (quoting Schiller v. City of N.Y., Nos. 04-CV-7922, 04-CV-7921, 2008 WL 4525341, at *7 (S.D.N.Y. Oct. 9, 2008)).). Although the Court could theoretically re-open discovery, order Coyne to appear for a deposition, and permit the Parties to re-submit motions for summary judgment, doing so would "serve no purpose except to encourage parties to disregard the Court's scheduling order ... [and would] result in further delay." Lidle v. Cirrus Design Corp., No. 08-CV-1253, 2009 WL 4907201, at *7-8 (S.D.N.Y. Dec. 18, 2009). In addition, at the time that Coyne submitted his declaration, discovery had been closed for nearly a year. See Design Strategy, 469 F.3d at 297 (explaining that "weighing heavily on both the prejudice
Finally, it is worth noting that although preclusion under Rule 37 is warranted in the absence of a finding of bad faith, it is difficult to conceive how NWS's purported founder, owner, principal, and lawyer could bring this Action and then in good faith fail to appear for a duly noticed deposition, fail to reschedule the same in a timely manner, and disavow that he has knowledge of material facts, only to submit a declaration in connection with the Summary Judgment Motions with highly relevant information when there is no possibility, absent the re-opening of discovery, in which he could have been cross-examined on the information that he provides. The Court finds that the only logical inference in light of these facts, in the absence of another explanation, is that Coyne's failure to appear for his deposition was in bad faith, which strengthens the conclusion that this evidence should be precluded. See Design Strategy, 469 F.3d at 296 (holding that Rule 37(c)(1) "does not require a showing of bad faith" but that bad faith "can be taken into account as part of the party's explanation for its failure to comply"); Gagasoules v. MBF Leasing LLC, 286 F.R.D. 205, 214 (E.D.N.Y.2012) ("`Rule 37(d) makes it explicit that a party properly served has an absolute duty to respond, that is, to present himself for the taking of his deposition, ... and that the court in which the action is pending may enforce this duty by imposing sanctions for its violation.'" (alteration in original) (quoting Penthouse Int'l, Ltd. v. Playboy Enters., Inc., 663 F.2d 371, 390 (2d Cir. 1981))). Accordingly, NameMedia's Motion to Strike the Coyne Declaration and the accompanying Exhibits pursuant to Rule 37(d) is granted.
NameMedia also moves to strike Exhibits 1, 2, 4-11 and 17-19 to the Neal Declaration (the "Neal Exhibits"), paragraphs 15 through 30 of the Neal Declaration, and portions of Exhibit 3 to the Kossar Declaration, which contain the relevant excerpts from Neal's Deposition.
Neal Exhibits 1 and 2 are screenshots of the website located at www.new worldsolutions.com allegedly accessed by Neal on March 1, 2012 and June 29, 2012, respectively. (Neal Decl. ¶¶ 4-5; id. at Exs. 1-2.) During discovery, NWS made a single 91-page document production that included only one screenshot of the website located at www.newworldsolutions. com. (See Def.'s Strike Mem. 8-9; Schwimmer Decl. II ¶ 3.) There is a marked difference in the content displayed on the holding page screenshot produced by NWS in discovery and in the content of Neal Exhibits 1 and 2. (Compare Schwimmer Decl. I Ex. 19, at 00088, with Neal Decl. Exs.1-2.) The former displays as "Related Searches" a miscellaneous array of "New World" phrases, (e.g., "New World Hotel Beijing"), whereas Neal Exhibits 1 and 2 show "Related Searches" primarily related to debt relief and technology outsourcing. NWS uses Neal Exhibits 1 and 2 to support its allegation that (1) NameMedia has engaged in deceptive acts and false advertising under the NYGBL, and (2) NameMedia has intentionally diluted trademarks by extracting keywords from websites returned in searches for keywords relevant to NameMedia's domain names and incorporating those keywords into its website. (Pl.'s Mem. of Law in Opp'n to Def.'s Mot. for Summ. J. and in Supp. of Pl.'s Cross-Mot. for Summ. J. ("Pl.'s Summ. J. Mem.") 8-9 (Dkt. No. 81).)
Preclusion of these exhibits is warranted. First, NWS offers no convincing explanation for its failure to produce the Neal Exhibits during discovery, despite the fact that Defendant requested documents concerning Internet searches conducted on behalf of Plaintiff or by Plaintiff concerning the Mark, documents concerning the Domain Name, documents NWS intended to rely upon on the instant Action, all documents supporting Plaintiff's Complaint, and all documents refuting Defendant's Answer. (Schwimmer Decl. II ¶¶ 4, 10; see Schwimmer Decl. I Ex. 10
The second factor weighs against preclusion because in general evidence of a policy to mislead customers and dilute trademarks would have been relevant to establishing Plaintiff's claims, as explained below. Nevertheless, the third factor cuts in favor of preclusion. NameMedia is prejudiced by the post-discovery introduction of Neal Exhibits 1 and 2 because they differ in relevant respects from the holding page screenshot produced by NWS in discovery. Although Plaintiff argues that Defendant is not prejudiced because "Plaintiff is simply using ... Defendant's own materials to rebut ... Defendant's own statements," (Pl.'s Strike Mem. 2-3), Defendant disputes that the website printouts are its "own materials," explaining that NameMedia "operates close to a million websites that can change on a frequent basis," and, therefore, the multiple screenshots are not properly considered its own materials. (Mem. in Further Supp. of Def.'s Mot. To Exclude and Strike Pursuant to Fed. R. Civ. P. 37 and 56 and in Opp'n to Pl.'s Cross-Mot. To Strike ("Def.'s Strike Reply") 15 (Dkt. No. 98).) The Court agrees that the screenshots are not Defendant's "own materials," but rather were documents that were in the control and possession of Plaintiff based on websites that Neal accessed on specific days. By producing these documents after the close of discovery, NameMedia did not have an opportunity to question Neal about the exhibits or introduce evidence to refute the conclusions he draws from the exhibits. See 523 IP LLC, 48 F.Supp.3d at 638 (explaining that the prejudice to the plaintiff from the failure to disclose was significant because it was the defendant's "obligation to identify evidence underlying its defenses and the witnesses who may possess such evidence," and because it did not, the plaintiff did not have the opportunity to depose the relevant people or seek its own discovery).
Fourth, as explained above, a continuance is not warranted at this stage of the
Neal Exhibits 4 and 5 are HTML source code for the www.newworldsolutions.com website, which Neal allegedly accessed on March 1, 2012 and June 25, 2013, respectively. (Neal Decl. ¶¶ 7-10; id. at Exs. 4-5.) Neal Exhibit 6 is a printout from a website of the "W3C org specification regarding the ROBOTS HTML META-TAG," which Neal allegedly accessed on June 25, 2013. (Neal Decl. ¶ 11; id. at Ex. 6.) NWS relies on Neal Exhibits 4, 5 and 6 to argue that, contrary to its representation otherwise, NameMedia does not use a robot exclusion policy to prevent search engines from indexing their website, but "actually encourages [indexing]." (Pl.'s Summ. J. Mem. 11-12; see also Pl.'s 56.1 ¶ 9.)
The Patterson factors counsel against excluding Neal Exhibits 4, 5, and 6. First, NWS offers no explanation of its failure to produce Exhibits 4, 5, and 6 during discovery despite its control and possession over those documents and their responsiveness to Defendant's interrogatories.
Neal Exhibits 7 and 8 are printouts of webpages from www.smartname.com, which Neal allegedly accessed on June 25, 2013 and June 28, 2013, respectively. (Neal Decl. ¶¶ 12-13; id. at Exs. 7-8.) Neal Exhibit 9 is allegedly the result of Neal's June 25, 2013 search for "newworldsolutions.com" on www.who.is. (Neal Decl. ¶ 14; id. at Ex. 9.) NWS cites Neal Exhibits
The Patterson factors counsel in favor of excluding Neal Exhibits 7, 8, 9, 10, and 11 for substantially the same reasons they counsel in favor or excluding Neal Exhibits 1 and 2. In particular, there is no reasonable explanation for failing to produce those Exhibits during discovery, Plaintiff's explanation as to its need to respond to evidence and/or explanations provided by Zilinek are inapplicable to these exhibits, and NameMedia is prejudiced by its inability to address or take discovery on these exhibits.
Neal Exhibits 17 through 19 are allegedly the "result[s]" of Neal's accessing, on June 27, 2013, the websites at www.new worldsolutions.org, www.newworld-solutions.com, and namemedia.com/our-business/domain-marketplace/, respectively. (Neal Decl. ¶¶ 42-44; id. at Exs. 17-19.) NWS cites Neal Exhibits 17 and 18 to rebut NameMedia's assertions that two other organizations named "New World Solutions" maintain websites. (See Def.'s 56.1 ¶¶ 63-64; Pl.'s 56.1 ¶¶ 63-64.) NWS cites Neal Exhibit 19 as evidence that NameMedia admits that it "traffics in domain names." (Pl.'s 56.1 ¶¶ 68, 81.)
The Patterson factors counsel against excluding Neal Exhibits 17 and 18. First, NameMedia first alleged the existence and websites of other organizations called "New World Solutions" in its Motion for Summary Judgment, (see Def.'s 56.1 ¶¶ 59-64), which provides NWS with a reasonable explanation for its post-discovery submission of Exhibits 17 and 18. Second, while the existence (or not) of two of the alleged websites does not carry much weight with respect to whether the Mark is "famous" or "distinctive" for purposes of Plaintiff's claims, it is relevant to that determination. Third, prejudice to NameMedia is de minimis especially because NameMedia first alleged the existence of other "New World Solutions" in its moving papers for Summary Judgment.
Conversely, Exhibit 19 should be excluded. NWS does not and cannot explain its failure to disclose the NameMedia website print-out. The statements about NameMedia's business model do not provide essential evidence for any of the claims at issue because these claims are dismissed on grounds, as explained below, that make this evidence irrelevant, and NameMedia is prejudiced by its inability to address or take discovery regarding Exhibit 19.
The challenged portions of Neal's deposition and declaration relate to NameMedia's alleged keyword optimization policy and Neal's attempts to "verify" the existence of the same by entering keywords relevant to NWS's business activities into the search box on the website at www.new worldsolutions.com, and then allegedly discovering that those keywords newly appeared on that website. (See Neal Tr. 119, 121-125; Neal Decl. ¶¶ 15-30.)
NameMedia argues that Neal's testimony is irrelevant, and therefore inadmissible, under Federal Rule of Evidence 402, because the keyword optimization policy which Neal allegedly attempted to verify is, according to Neal's deposition testimony, the stated policy of a third party, "[which Plaintiff] think[s] is a subsidiary of NameMedia." (Def.'s Strike Mem. 18; Neal Tr. 120.)
NameMedia is correct that the "optimization policy" allegedly described on the website of an entity that NWS "think[s] is a subsidiary of NameMedia" is not relevant to this Action, and that Neal's testimony about the same is, therefore, inadmissible under Federal Rule of Evidence 402. In his deposition, Neal based his conclusion that "[i]t appear[s] ... that [www.newworldsolutions.com] was looking at our website or the Coyne Legal Group or Credit Legal Group website ... and extracting key words and placing them on their website" on "looking at the [possible]
The rest of the challenged testimony pertains to actions allegedly taken by Neal on newworldsolutions.com. However, it is far from clear that Neal's "tests" establish anything about NameMedia's alleged optimization policy. In addition to testifying that he has "no evidence" that NameMedia has a keyword optimization policy, Neal testified that he "ha[s] no idea" whether his entering terms in the search box on www.newworldsolutions.com caused some of those terms to subsequently appear on the website. (Neal Tr. 124-125.) Pursuant to Federal Rule of Evidence 401, evidence is relevant if it "has any tendency to make a fact more or less probable than it would be without the evidence" and "the fact is of consequence in determining the action." Because Neal's testimony about his keyword searches on www.newworldsolutions. com does not make more or less probable the existence of the alleged keyword optimization policy, the testimony is not relevant and is therefore inadmissible under Federal Rule of Evidence 402.
Moreover, as relevant to Rule 602, "[t]he test for admissibility is whether a reasonable trier of fact could believe the witness had personal knowledge." New York ex rel. Spitzer v. Saint Francis Hosp., 94 F.Supp.2d 423, 425 (S.D.N.Y. 2000); see also Peters v. Molloy Coll. of Rockville Ctr., No. 07-CV-2553, 2010 WL 3170528, at *2 (E.D.N.Y. Aug. 10, 2010) (same). Neal testified that does not know whether NameMedia has a keyword optimization policy and he did not know why the words he typed on the search box subsequently appeared on the website. The testimony, then, is also inadmissible under Rule 602. The Motion To Strike pages 119-129 and 325-335 of Neal's deposition testimony, and to strike paragraphs 15-30 of the Neal Declaration, is, therefore, granted.
As an initial matter, NameMedia correctly points out that Plaintiff submitted its Cross-Motion to Strike without the permission of the Court. (See Def.'s Strike Reply 3-4.) Pursuant to Local Civil Rule 37.2 and this Court's Rules, NWS should have submitted a letter requesting leave to bring its Cross-Motion. Nevertheless, the Court considers the merits of the Motion, as Defendant has filed a response that addresses Plaintiff's arguments.
NWS cross-moves to strike all of Zilinek's declarations submitted in this Action (collectively, the "Zilinek Declarations").
The Patterson factors weigh against granting NWS's Motion with respect to all portions of the Zilinek Declarations and accompanying exhibits, with one exception, as discussed below. First, there was no failure to disclose by NameMedia. NameMedia identified Zilinek in its Supplemental Rule 26(a)(1) disclosures, (see Schwimmer Decl. III ¶ 5 & Ex. 2), but NWS failed to properly notice Zilinek for a deposition, (see Def.'s Strike Reply 5). Because there is no failure to disclose Zilinek as a potential witness, there is no failure to excuse under the first factor. Cf. Fleming v. Verizon N.Y. Inc., No. 03-CV-5639, 2006 WL 2709766, at *7-9 (S.D.N.Y. Sept. 22, 2006) (granting the motion to preclude where the plaintiff failed to disclose the relevant names in the Rule 26(a)(1)(A) disclosures).
As to the second factor, NameMedia maintains that "whether its website crawls third-party websites, or is itself crawled by search engine `robots,' is immaterial to the case-in-chief ... [because] Plaintiff cannot establish trademark priority or rights prior to March 2005." (Def.'s Strike Reply 7.) Nonetheless, NameMedia argues that the Zilinek Declarations are "necessary" to correct NWS's "incoherent and incompetent stab at contriving a disputed issue with regards to crawling and robot exclusion," and specifically to refute the source code evidence submitted by Neal in support of NWS's contention that NameMedia does not use robot exclusion. (Id. 6-7, 7 n.12.) Because the Court denied NameMedia's Motion To Strike the evidence submitted by Neal pertaining to "robot exclusion," NameMedia's related submissions contained in Zilinek Declaration I and Zilinek Declaration III are relevant, and should likewise be considered. Conversely, because the Court granted NameMedia's Motion to Strike the evidence submitted by Neal pertaining to the alleged "keyword optimization" policy, NameMedia's related submission, Zilinek Declaration II, is likewise excluded, but only to the extent that its irrelevance results from this ruling.
NameMedia also correctly notes that NWS's purported showing that the Zilinek submissions "misled" the Court and its ability to propound evidence that
NWS also moves to strike "the statement of Martin B. Schwimmer that their firm has never been advised by any representative of Plaintiff that ... Coyne would be available for a deposition." (Pl.'s Strike Mem. 5; see also Schwimmer Decl. II ¶ 17.) The only apparent basis for the motion is that NWS contests the accuracy of Mr. Schwimmer's statement. (See id. at 2.) Accordingly, NWS's Motion to strike Schwimmer's statement is denied.
Summary judgment shall be granted 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(a); see also Psihoyos v. John Wiley & Sons, Inc., 748 F.3d 120, 123-24 (2d Cir.2014) (same). "In determining whether summary judgment is appropriate," a court must "construe the facts in the light most favorable to the non-moving party and ... resolve all ambiguities and draw all reasonable inferences against the movant." Brod v. Omya, Inc., 653 F.3d 156, 164 (2d Cir. 2011) (internal quotation marks omitted); see also Borough of Upper Saddle River v. Rockland Cty. Sewer Dist. No. 1, 16 F.Supp.3d 294, 314 (S.D.N.Y.2014) (same). Additionally, "[i]t is the movant's burden to show that no genuine factual dispute exists." Vt. Teddy Bear Co. v. 1-800 Beargram Co., 373 F.3d 241, 244 (2d Cir.2004); see also Aurora Commercial Corp. v. Approved Funding Corp., No. 13-CV-230, 2014 WL 1386633, at *2 (S.D.N.Y. Apr. 9, 2014) (same). "However, when the burden of proof at trial would fall on the nonmoving party, it ordinarily is sufficient for the movant to point to a lack of evidence to go to the trier of fact on an essential element of the nonmovant's claim," in which case "the nonmoving party must come forward with admissible evidence sufficient to raise a genuine issue of fact for trial in order to avoid summary judgment." CILP Assocs., L.P. v. PriceWaterhouse Coopers LLP, 735 F.3d 114, 123 (2d Cir.2013) (alteration and internal quotation marks omitted). Further, "[t]o survive a [summary judgment] motion ..., [a nonmovant] need[s] to create more than a `metaphysical' possibility that his allegations were correct; he need[s] to `come forward with specific facts showing that there is a genuine issue for trial,'" Wrobel v. Cty. of Erie, 692 F.3d 22, 30 (2d Cir.2012) (emphasis omitted) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986)), and "cannot rely on the mere allegations or denials contained in the pleadings," Walker
"On a motion for summary judgment, a fact is material if it might affect the out-come of the suit under the governing law." Royal Crown Day Care LLC v. Dep't of Health & Mental Hygiene of City of N.Y., 746 F.3d 538, 544 (2d Cir.2014) (internal quotation marks omitted). At summary judgment, "[t]he role of the court is not to resolve disputed issues of fact but to assess whether there are any factual issues to be tried." Brod, 653 F.3d at 164 (internal quotation marks omitted); see also In re Methyl Tertiary Butyl Ether ("MTBE") Prods. Liab. Litig., MDL No. 1358, No. M21-88, 2014 WL 840955, at *2 (S.D.N.Y. Mar. 3, 2014) (same). Thus, a court's goal should be "`to isolate and dispose of factually unsupported claims.'" Geneva Pharm. Tech. Corp. v. Barr Labs. Inc., 386 F.3d 485, 495 (2d Cir.2004) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)); see also Shamrock Power Sales, LLC v. Scherer, No. 12-CV-8959, 2015 WL 5730339, at *20 (S.D.N.Y. Sept. 30, 2015) (same).
NWS alleges that NameMedia's use and registration of "newworldsolutions.com" has "diluted the distinctive quality of the commercially valuable mark New World Solutions" in violation of the FTDA. (FAC ¶¶ 25-27.)
"Federal law allows the owner of a `famous mark' to enjoin a person from using `a mark or trade name in commerce that is likely to cause dilution by blurring or dilution by tarnishment of the famous mark.'" Tiffany (NJ) Inc. v. eBay Inc., 600 F.3d 93, 110-11 (2d Cir.2010) (quoting 15 U.S.C. § 1125(c)(1)); see also Starbucks Corp. v. Wolfe's Borough Coffee, Inc., 736 F.3d 198, 205 (2d Cir.2013) (same). "Prior to October 2006, the federal anti-dilution statute, known then as the [Federal Trade Dilution Act of 1996 (`FTDA')], entitled the owner of a famous mark to injunctive relief if another person's commercial use in commerce of a mark or trade name ... causes dilution of the distinctive quality of the famous mark." Burberry Ltd. v. Euro Moda, Inc., No. 08-CV-5781, 2009 WL 1675080, at *8 (S.D.N.Y. June 10, 2009) (second alteration in original) (some alterations, emphasis, and internal quotation marks omitted). "The FTDA provided that the owner of a famous mark `shall be entitled only to injunctive relief ... unless the person against whom the injunction is sought willfully intended to trade on the owner's reputation or to cause dilution of the famous mark. If such willful intent is proven, the owner of the famous mark shall also be entitled to,'" among other things, monetary relief. Id. (alteration in original) (emphasis omitted) (quoting 15 U.S.C. § 1125(c)(2) (2000)). To establish a violation of the FTDA, a plaintiff must show that: "(1) its mark is famous; (2) the defendant is making commercial use of the mark in commerce; (3) the defendant's use began after the mark became famous; and (4) the defendant's use of the mark dilutes the quality of the mark by diminishing the capacity of the mark to identify and distinguish goods and services." Louis Vuitton Malletier v. Dooney & Bourke, Inc., 454 F.3d 108, 118 (2d Cir.2006) (internal quotations omitted); see also Savin Corp. v.
On October 6, 2006, President Bush signed into law the Trademark Dilution Revision Act of 2006 (the "TDRA"), which amended the FTDA "to clarify that the owner of a famous mark seeking an injunction need prove only that the defendant's mark `is likely to cause dilution of the famous mark, regardless of the presence or absence of actual or likely confusion, of competition, or of actual economic injury.'" Starbucks Corp., 736 F.3d at 202 (alteration omitted) (quoting 15 U.S.C. § 1125(c)(1)); see also Dan-Foam A/S v. Brand Named Beds, LLC, 500 F.Supp.2d 296, 306-08 & n. 87 (S.D.N.Y.2007) (same). The TDRA applies to a claim filed before the statute went into effect "to the extent that [the plaintiff] has sought injunctive relief on the issue of dilution." Starbucks Corp. v. Wolfe's Borough Coffee, Inc., 477 F.3d 765, 766 (2d Cir.2007) (per curiam); see also Burberry Ltd., 2009 WL 1675080, at *9 (same); Dan-Foam A/S, 500 F.Supp.2d at 306 n. 87 (same). "[A]ctual dilution under [FTDA standards] still applies when a pre-October 6, 2006 claimant seeks monetary relief." Dan-Foam A/S, 500 F.Supp.2d at 308.
As relevant here, under both the FTDA and TDRA, "a trademark owner must ... demonstrate that its mark is famous or `widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark's owner.'" Malletier v. Dooney & Bourke, Inc., 561 F.Supp.2d 368, 380 (S.D.N.Y. 2008) (quoting 15 U.S.C. § 1125(c)(2)(A)). Indeed, "[w]hile the TDRA reconfigured the factors used by courts to evaluate fame, the Second Circuit's requirement that the senior mark must be truly famous before a court will afford the owner of the mark the vast protections of the FTDA remains unchanged." Id. at 380-81 (alteration and internal quotation marks omitted). In particular, "to sustain a claim under the FTDA [or the TDRA] ... a plaintiff must show that the senior mark possesses both a significant degree of inherent distinctiveness and, to qualify as famous, a high degree of acquired distinctiveness." Savin Corp., 391 F.3d at 449 (alteration, emphasis, and internal quotation marks omitted); see also George Nelson Found. v. Modernica, Inc., 12 F.Supp.3d 635, 647-48 (S.D.N.Y.2014) (same). It is important to emphasize that, "[a]lthough a plaintiff must show a preponderance of evidence on each element of a claimed violation of the FTDA in order ultimately to prevail on such a claim ... the element of fame is the key ingredient[,] ... because ... the [prerequisite] that most narrows the universe of potentially successful claims is the requirement that the senior mark be truly famous before a court will afford the owner of the mark the vast protections of the FTDA [or TDRA]." Savin Corp., 391 F.3d at 449 (citation omitted). Accordingly, "a plaintiff owning only less-than-famous marks will receive no protection under the FTDA, even if that plaintiff can prove that the use of an identical junior mark has in fact lessened the capacity of the senior mark to identify and distinguish the plaintiff's goods or services — i.e., that actual dilution has occurred." Savin Corp., 391 F.3d at 449 n.5. To aid in this inquiry, 15 U.S.C. § 1125(c)(2) provides that:
15 U.S.C. § 1125(c)(2); see also George Nelson Found., 12 F.Supp.3d at 648 (same).
For the purpose of its Motion for Summary Judgment on NWS's FTDA claim, NameMedia concedes that it makes commercial use of "www.newworldsolutions. com." (Def.'s Mem. in Supp. of its Mot. for Summ. J. ("Def.'s Summ. J. Mem.") 14 (Dkt. No. 72.).) NameMedia's principal argument in support of the Motion is that "no rational trier of fact could find that Plaintiff's mark was famous ... in 2005 when NameMedia registered the Domain Name." (Id. at 15.)
To begin, the TDRA applies to the pre-October 6, 2006 conduct to the extent that Plaintiff seeks injunctive relief and not monetary damages. See Burberry Ltd., 2009 WL 1675080, at *9. As the crux of the Court's analysis turns on whether the Mark was famous at the time of Defendant's conduct, however, this distinction is largely irrelevant. To the extent that NWS argues that it has "no duty to show that the mark was famous at the time of registration in order to prevail on their claim," (Pl.'s Summ. J. Mem. 5-6), this is incorrect. As the case law cited above makes clear, a party must show that its mark is famous to invoke the protection of the FTDA. Indeed, it bears repeating that "fame is the key ingredient" in a federal dilution claim. Savin, 391 F.3d at 449. Plaintiff's citation to Sporty's Farm L.L.C. v. Sportsman's Market, Inc., 202 F.3d 489 (2d Cir.2000) is inapposite as to whether Plaintiff needs to show that the Mark was famous for the purpose of establishing a claim under the FTDA. (Pl.'s Summ. J. Mem. 5-6.) In Sporty's Farm, the Second Circuit explained that the Anticybersquatting Consumer Protection Act ("ACPA") distinguishes between "distinctiveness" and "fame" and protects both distinctive and famous marks. Sporty's Farm, 202 F.3d at 497. In other words, while the FTDA "protects marks that are both famous and distinctive from dilution, a mark needs only one of those qualities to merit protection under the ACPA," which is discussed in more detail below. Prime Publishers, Inc. v. American-Republican, Inc., 160 F.Supp.2d 266, 277 (D.Conn. 2001); see also George Nelson Found., 12 F.Supp.3d at 648 ("The threshold finding of distinctiveness ... is a necessary, but not sufficient, element of fame [under the FTDA]." (first alteration in original) (internal quotation marks omitted)).
NWS also argues that the "fame of the mark at the time of registration is an issue in dispute for a jury to decide" because "Plaintiff has testified that the mark was in use since 2004, but that due to a hard drive crash, the records prior to 2007 were lost." (Pl.'s Summ. J. Mem. 5.) Drawing all inferences in NWS's favor, there is no basis in the record to find that, in March of 2005, the Mark was famous for the purposes of the federal dilution claim. Plaintiff relies solely on Neal's deposition testimony to establish the existence and extent of NWS's promotional and business activities in 2004 and 2005. However, as described above, it is undisputed that
Even considering Neal's testimony as true, there is no evidence that the Mark was "famous" prior to 2007 for the purpose of invoking protection under the FTDA. Neal testified that, in 2004, NWS made no "systemic telemarketing effort," that its promotional activities consisted solely of "one-on-one techniques" — i.e. cold calls and e-mails from Coyne and Neal — and mailing postcards, and that NWS "didn't really formalize the [marketing] process until 2008, 2009, something like that." (Neal Tr. 30-31, 89.) This is not a case, then, where "publication in well-known national magazines supports a showing [that] the mark is famous." George Nelson Found., 12 F.Supp.3d at 649 (explaining that the plaintiff, as the plaintiff in Savin, "point[ed] to specific publications and allege[d] the national, and even global, renown of the marks"). Moreover, Plaintiff did not maintain a website in 2004, and Neal testified that he directed potential clients to the domain name "ShaunNeal.com." (Neal Tr. 39, 51-52.) Neal described three clients for whom NWS performed services in 2004: Merrill Lynch, "a real estate company in Arizona," and "a client who was an institutional foreign exchange trader." (Id. 36-37.) Neal also testified that the d/b/a entity generated "a few hundred thousand" in revenue in 2004 and "over a million" in 2005 and 2006, but that any revenue would have been reported as part of Neal's personal income tax and that NWS first filed a tax return in its own name in 2008. (Id. at 91, 147-48.) Even accepting Neal's representation of NWS's revenue in these years as true, however, this revenue generation, without more, does not support an inference that the Mark is or was famous. See TCPIP
Finally, NWS offers no evidence of "actual recognition of the [M]ark" prior to 2007, let alone that the Mark was "widely recognized." 15 U.S.C. § 1125(c)(2)(A).
NWS also alleges that NameMedia's registration and use of "newworldsolutions.com" violates the ACPA. (FAC ¶¶ 28-33.)
The ACPA was "passed to remedy the perceived shortcomings of applying the FTDA in cybersquatting cases," and "create[s] a specific federal remedy for cybersquatting." Sporty's Farm, 202 F.3d at 496. The ACPA provides that:
15 U.S.C. § 1125(d)(1)(A). "To make out a cybersquatting claim, courts in [the Second Circuit] consider (1) whether the mark is distinctive or famous; (2) whether the domain name is identical or `confusingly similar' to the mark; and (3) whether the domain name registrant acted with a `bad faith intent to profit' from the mark when it registered the domain name." Kuklachev, 600 F.Supp.2d at 472 (citing Sporty's Farm, 202 F.3d at 497-99); see also Dudley v. HealthSource Chiropractic, Inc., 585 F.Supp.2d 433, 438 (W.D.N.Y.2008) (same).
Pursuant to the first prong, "[d]istinctiveness refers to inherent qualities of a mark and is a completely different concept from fame. A mark may be distinctive before it has been used — when its fame is nonexistent. By the same token, even a famous mark may be so ordinary[] or descriptive as to be notable for its lack of distinctiveness." Sporty's Farm, 202 F.3d at 497. "Marks are classified, in ascending order of strength, as (1) generic; (2) descriptive; (3) suggestive; or (4) arbitrary or fanciful." Star Indus., Inc. v. Bacardi & Co., 412 F.3d 373, 384-85 (2d
Pursuant to the second prong, the "confusingly similar" standard under the ACPA is different from the "`likelihood of confusion' standard for trademark infringement," and "whether a domain name is confusingly similar to a trademark is to be evaluated without regard to the goods or services of the parties." Dudley, 585 F.Supp.2d at 440 (some internal quotation marks omitted). Finally, the ACPA provides a list of non-exhaustive factors to consider in determining whether there is "bad faith intent" to profit from a mark. In particular, a court may consider such factors as:
15 U.S.C. § 1125(d)(1)(B). However, "[b]ecause the ACPA has the potential to encompass a broad array of online conduct, courts are `reluctant to interpret the ACPA's liability provisions in an overly aggressive manner,' ... [which] is particularly true of the bad faith intent to profit requirement," and, therefore, "a number of courts — including the Second Circuit — have departed from strict adherence to the statutory indicia and relied expressly on a more case-specific approach to bad faith." Gioconda Law Grp. PLLC v. Kenzie, 941 F.Supp.2d 424, 432-33 (S.D.N.Y.2013) (quoting Virtual Works, Inc. v. Volkswagen of Am., Inc., 238 F.3d 264, 270 (4th Cir.2001)); see also Sporty's Farm, 202 F.3d at 498-99 (applying the statutory factors and other considerations "which do not fit neatly into the specific factors enumerated by Congress" to determine whether there was bad faith intent to profit). Therefore, "[a] court must analyze each case based on its unique circumstances to determine how close a defendant's conduct falls to the ACPA's heartland — the clearest example of which is the situation where a defendant registers an established entity's domain name in bad faith and offers to sell it to the entity for an exorbitant price." Gench v. HostGator.com LLC, No. 14-CV-3592, 2015 WL 569154, at *7 (S.D.N.Y. Feb. 11, 2015) (citation and internal quotation marks omitted), adopted by 2015 WL 1054968 (S.D.N.Y. Mar. 10, 2015). Another "quintessential example[]" of bad faith is "where a defendant intends to profit by diverting customers from the website of the trademark owner to the defendant's own website, where those customers would purchase the defendant's products or services." Gioconda Law Grp., 941 F.Supp.2d at 434 (alteration and internal quotation marks omitted).
Defendant argues that Plaintiff cannot establish the first prong of an ACPA claim because there is no evidence that, in March of 2005, the Mark was famous or distinctive, or even that it existed. Indeed, Plaintiff has not proffered sufficient evidence to create a genuine issue of material fact as to whether the Mark existed, or in other words was in use, in 2005. A threshold requirement of the ACPA is that the plaintiff is "the owner of a mark." Mont. Jewelry, Inc. v. Risis, No. 11-CV-4875, 2013 WL 1232324, at *3 (E.D.N.Y. Mar. 26, 2013) (citing 15 U.S.C. § 1125(d)(1)(A)). A service mark exists by virtue of its use in commerce. See Am. Express v. Goetz, 515 F.3d 156, 161 (2d Cir.2008) ("[T]here can be no trademark absent goods sold and no service mark without services rendered.... [I]t cannot be said that a service mark is actually used if it is displayed in an advertisement for services that are non-existent or will only hypothetically be available at some point in the future."). In other words, "[o]wnership of a mark arises from a party's prior use of the mark to identify its goods or services in a given market." Mont. Jewelry, Inc., 2013 WL 1232324, at *3 (citing ITC Ltd. v. Punchgini, Inc., 482 F.3d 135, 147 (2d
Although Plaintiff contends that Neal's deposition testimony establishes that the Mark was "in use" prior to 2007, (Pl.'s Summ. J. Mem. 6), Plaintiff offers no evidence, besides Neal's testimony, to support this claim. Indeed, it is undisputed that there is no documentary evidence that supports the Mark existed prior to 2007. As Defendant argues, Neal's unsubstantiated and self-serving testimony is insufficient, without more, to defeat summary judgment. See Brusso v. Imbeault, 699 F.Supp.2d 567, 583 (W.D.N.Y.2010) ("[A] plaintiff's deposition testimony alone is insufficient to defeat a motion for summary judgment."); Wurtzel v. Starbucks Coffee Co., 257 F.Supp.2d 520, 525 (E.D.N.Y.2003) (explaining that the opposing party could not rely upon speculation or conjecture in opposing the motion for summary judgment); Palmer v. Circuit Court of Cook Cty., Social Serv. Dep't, 905 F.Supp. 499, 505 (N.D.Ill.1995) ("[U]nsubstantiated and self-serving testimony ... is simply not sufficient under [the summary judgment rule] to create a genuine issue of material fact and defeat an otherwise properly supported motion for summary judgment where there is no other corroborating evidence in the record to support th[e] statement."), aff'd sub nom. Palmer v. Circuit Court of Cook Cty., Ill., 117 F.3d 351 (7th Cir.1997).
Fatal to Neal's assertion is NWS's June 28, 2010 Application to the USPTO, wherein NWS described the services it provides as "[c]omputer hardware and software consulting services; [i]nformation technology consultation; [s]ervices for maintenance of computer software; [s]oftware design and development" and stated that its first use of the Mark, and its first use of the Mark in commerce, occurred "at least as early as 6/21/2007." (Schwimmer Decl. I Ex. 18.) This undercuts any claim that the Mark was in use in 2005. Cf. Web-adviso v. Trump, 927 F.Supp.2d 32, 39 (E.D.N.Y. 2013) (explaining that prior to the plaintiff registering the domain names in 2007, the defendant "attested to the USPTO that the TRUMP mark was incontestable when used in hotel services, bottled water[,] and golf club services, because [the] [d]efendant had registered and continuously used the mark in connection with these goods and services for at least five years" and the USPTO "accepted and acknowledged [the] [d]efendant's attestation"). Without establishing that the Mark was in use at the time of Defendant's conduct, there can be no ACPA claim. See Am. Online Latino, 250 F.Supp.2d at 360 (explaining that "[i]n view of [the] plaintiff's admission that he owned no trademark, and as he indisputably was not the senior user, he cannot state a claim for relief under the ACPA").
Plaintiff's claim under the ACPA also fails under the third prong — that Defendant acted in bad faith with an intent to profit from Plaintiff's Mark. Defendant's activity as to the Domain Name does not fall within any of the "quintessential examples" of bad faith that courts have acknowledged. There can be no claim that Defendant "purchase[d] [the] [D]omain [N]ame very similar to the [Mark] and then offer[ed] to sell the name to [Plaintiff] at an extortionate price," Gioconda Law Grp., 941 F.Supp.2d at 434 (quoting Utah Lighthouse Ministry v. Found. for Apologetic Info. & Research, 527 F.3d 1045, 1058 (10th Cir.2008)), because there is absolutely no viable evidence that the Mark was in use in 2005, for the reasons described above. Nor is this a case where Defendant "intend[ed] to profit by diverting customers from the website of the trademark owner to [Defendant's] own website, where those consumers would purchase [Defendant's] products or services instead of [Plaintiff's]." Id. (quoting Utah Lighthouse Ministry, 527 F.3d at 1058). Indeed, there is no evidence that Plaintiff had an online presence until at least 2007, (cf. Pl.'s Resps. to Def.'s First Set of Interrogs. No. 16 (describing the websites that Plaintiff owns, "which were purchased between August 2, 2007 and September 26, 2011")), and, accordingly, as Defendant points out, it "could not have had a bad faith intent (or any intent) to divert Internet traffic from Plaintiff when Plaintiff had no Internet traffic to divert," (Def.'s Summ. J. Mem. 13). Cf. Lewittes v. Cohen, No. 03-CV-189, 2004 WL 1171261, at *8 (S.D.N.Y. May 26, 2004) (explaining that because there were "no facts in the [c]omplaint that support an allegation that [the] plaintiff ha[d] his own website[,] ... it is no surprise that there [were] no facts to support any allegation that [the] defendants intended to divert business from any site the plaintiff might maintain"). Additionally, Plaintiff has offered no admissible evidence that Defendant currently diverts customers or traffic from Plaintiff's website. The Court acknowledges that the fact that NameMedia "offers a marketplace for purchase and sale of domain names by and for others and also purchases and sells domain names for its own accounts," (Def.'s 56.1 ¶ 72; Pl.'s 56.1 ¶ 72), "monetizes" some of its domain names, (Def.'s 56.1 ¶ 74; Pl.'s 56.1 ¶ 74), and boasts of an inventory of more than 900,000 domains, (Pl.'s 56.1 ¶ 81; Def.'s Reply 56.1 ¶ 81), could perhaps, in other circumstances, support a finding of bad faith, especially in light of the statutory factors a court may consider in making this determination. The circumstances of this case, however, do not support such a finding in the absence of evidence that NWS even existed prior to 2005. Summary judgment on the ACPA claim is warranted because Plaintiff has proffered no genuine evidence that at the time of registration of the Domain Name the Mark was in use and there is likewise no evidence that Defendant possessed the requisite "bad faith intent to profit" from the Mark.
NameMedia also seeks summary judgment as to Plaintiff's trademark dilution claim, brought pursuant to NYGBL § 360-l. (See FAC ¶¶ 39-44.)
NYGBL § 360-l provides that "[l]ikelihood of injury to business reputation or of dilution of the distinctive quality of a mark or trade name shall be a ground for injunctive relief in cases of infringement
"To gauge a mark's strength, [courts] consider two factors: its inherent distinctiveness, and its distinctiveness in the marketplace." Streetwise Maps, Inc. v. VanDam, Inc., 159 F.3d 739, 743 (2d Cir. 1998). "The second element a plaintiff must establish [under NYGBL § 360-l] is likelihood of dilution," which is defined "as either the blurring of a mark's product identification or the tarnishment of the affirmative associations a mark has come to convey." Johnson & Johnson, 2013 WL 4048295, at *10 (quoting Mead Data Cent., 875 F.2d at 1031).
Plaintiff's claim under NYGBL § 360-l fails under the first prong. Here, even assuming that NWS's mark has an inherent distinctiveness, "the total lack of any evidence of commercial recognition of the mark demonstrates that it is a relatively weak mark in the place where it counts: the marketplace." GMA Accessories, Inc., 2008 WL 591803, at *11 (alteration and internal quotation marks omitted); see also SLY Magazine, LLC v. Weider Publ'ns L.L.C., 529 F.Supp.2d 425, 443 (S.D.N.Y. 2007) (explaining that "[a]lthough [the]
NameMedia also moves for summary judgment on Plaintiff's claims under NYGBL §§ 349 and 350. (See FAC ¶¶ 34-38.)
NYGBL § 349 prohibits "[d]eceptive acts or practices in the conduct of any business, trade or commerce or in the furnishing of any service in this state."
"The standard for recovery under General Business Law § 350, while specific to false advertising, is otherwise identical to section 349." Goshen, 746 N.Y.S.2d 858, 774 N.E.2d at 1195 n. 1; see also RCA Trademark Mgmt., 2015 WL 5008762, at *3 (same); In re Scotts EZ Seed Litig., 304 F.R.D. at 409 ("The same analysis [under section 349] applies to false advertising claims brought under Section 350."); Yellow Book Sales & Distrib. Co. v. Hillside Van Lines, Inc., 98 A.D.3d 663, 950 N.Y.S.2d 151, 153 (2012) ("To successfully assert a claim under General Business Law §§ 349 or 350, a party must allege that its adversary has engaged in consumer-oriented conduct that is materially misleading, and that the party suffered injury as a result of the allegedly deceptive act or practice."). "Additionally, neither Section 349 nor 350 require proof of reliance, ... nor proof that defendants intended to mislead consumers." In re Scotts EZ Seed Litig, 304 F.R.D. at 409 (citing, inter alia, Koch v. Acker, Merrall & Condit Co., 18 N.Y.3d 940, 944 N.Y.S.2d 452,967 N.E.2d 675 (2012)).
NWS alleges that NameMedia "intends to deceive business and individual consumers into thinking that [NWS] in some way endorses or supports the activities of [] Defendant." (FAC ¶ 18.) Plaintiff also claims that "Defendant intends to deceive business and individual consumers that [NWS] is affiliated with [] Defendant," (id. ¶ 20), and Defendant "falsely advertised [its] services to the public by representing that [NWS] in some way endorses or is affiliated with [NameMedia]" in violation of NYGBL §§ 349 and 350, (id. ¶¶ 36-37). In its moving papers, NameMedia argues that "NWS cannot cite to any record evidence whatsoever that NameMedia's registration of the subject Domain Name was `misleading in a material way' or that Plaintiff was `injured' as a result of same." (Def.'s Summ. J. Mem. 19.) Plaintiff does not respond to Defendant's claims or defend its claims under NYGBL §§ 349 and 350 in its opposition papers. "When a party `offer[s] no response' to its opponent's motion to dismiss a claim, that claim is abandoned." Paul v. Bank of Am., N.A., No. 11-CV-81, 2011 WL 5570789, at *2 (D.Conn. Nov. 16, 2011) (alteration in original) (quoting Molinari v. Bloomberg, 564 F.3d 587, 609 n. 15 (2d Cir.2009)). Accordingly, the Court deems this claim abandoned and grants Defendant's Motion as to these claims. See id. (explaining that because the plaintiff failed to address a claim in opposition to summary judgment, "it appears to th[e] court that he has abandoned it"); see also Codrington v. City of N.Y., No. 12-CV-1650, 2015 WL 893567, at *14 (E.D.N.Y. Mar. 2, 2015) (deeming claims abandoned where the defendants moved for summary judgment against certain claims but the plaintiff's opposition did not address the arguments); Avola v. Louisiana-Pacific Corp., 991 F.Supp.2d 381, 390-91 (E.D.N.Y.2014) (same).
In any event, Plaintiff has failed to proffer evidence to show that there are genuine issues of material fact as to these claims. First, Plaintiff has failed to establish that Defendant's registration of the Domain Name or activities associated with the Domain Name were consumer-oriented. "Under New York law, claims involving trademark violations are not cognizable under N.Y. GBL §§ 349 or 350 unless `there is a specific and substantial injury to the public interest over and above ordinary trademark infringement or dilution.'" RCA Trademark Mgmt., 2015 WL 5008762, at *4 (quoting Coach, Inc. v. Horizon Trading USA Inc., 908 F.Supp.2d 426, 435 (S.D.N.Y.2012)); see also Lifeguard Licensing Corp. v. Gogo Sports, Inc., No. 10-CV-9075, 2013 WL 4400520, at *8 (S.D.N.Y. Aug. 15, 2013) ("[F]or [§ 349] to apply, a plaintiff must establish a direct harm to consumers that is greater than the general consumer confusion commonly found in trademark actions...." (internal quotation marks omitted)). Even in evaluating a Rule 12(b)(6) motion, "[c]laims that arise out of a trademark infringement action, and disputes between competitors where the core of the claim is harm to another business as opposed to consumers, both constitute situations which courts have found to reflect a public harm that is too insubstantial to satisfy the pleading requirements." RCA Trademark Mgmt., 2015 WL 5008762, at *4 (quoting Gucci Am., Inc. v. Duty Free Apparel, Ltd., 277 F.Supp.2d 269, 273 (S.D.N.Y. 2003)). Indeed, "[c]ourts have generally held that the type of injury needed to sustain a trademark violation under these provisions is limited to one `that would trigger Federal Trade Commission intervention under 15 U.S.C. § 45, such as potential danger to the public health or safety.'" Id. (quoting DO Denim, LLC v. Fried Denim, Inc., 634 F.Supp.2d 403, 409 (S.D.N.Y.2009)).
Second, even construing Plaintiff's evidence as support for the contention that customers were confused by Defendant's activities in relation to the Domain Name, (see Pl.'s 56.1 ¶ 11), "[c]ourts have held that a party's `claim that consumers will be confused, on its own, does not meet the threshold for liability' under [NYGBL] §§ 349 and 350." RCA Trademark Mgmt., 2015 WL 5008762, at *5 (quoting Philip Morris USA, Inc. v. U.S. Sun Star Trading, Inc., No. 08-CV-68, 2010 WL 2133937, at *6-7 (E.D.N.Y. Mar. 11, 2010), adopted by 2010 WL 2160058 (E.D.N.Y. May 27, 2010)); see also Luv N' Care, Ltd. v. Walgreen Co., 695 F.Supp.2d 125, 136 (S.D.N.Y.2010) (noting that actions alleging "only general consumer confusion" do not threaten direct harm to consumers for purposes of stating a claim under § 349). Accordingly, NameMedia's motion for summary judgment on the deceptive practices and false advertising claim is granted.
NameMedia moves for summary judgment on its claim that the Registration should be cancelled pursuant to 15 U.S.C. § 1119, because NWS allegedly made "fraudulent representations regarding material facts to the USPTO in the course of procuring the Registration" and "could not truthfully claim use of the [M]ark prior [to May 25, 2010]."
"A request for dismissal of a cancellation proceeding pursuant to section 1119 ordinarily is made as a counterclaim in an infringement action," Empresa Cubana del Tabaco v. Culbro Corp., 541 F.3d 476, 478 (2d Cir.2008), and whether to grant relief under this statute rests within the discretion of the district court, see id. (explaining that the discretionary authority afforded to district courts under 15 U.S.C. § 1119 is "demonstrated by [the statute's] use of the permissive `may' in authorizing courts to grant relief, as distinct from its use of the mandatory `shall' in requiring any orders or decrees that are entered to be sent to and followed by the [US]PTO"). To prevail on a claim for cancellation of a federally registered trademark under 15 U.S.C. § 1119, "a plaintiff must show that (1) it has standing to bring a cancellation claim, and (2) there are valid grounds for why the registration should not continue to be registered." Citigroup Inc. v. City Holding Co., No. 99-CV-10115, 2003 WL 282202, at *14 (S.D.N.Y. Feb. 10, 2003). "A registered mark may be canceled based upon misstatements in a trademark application if the plaintiff demonstrates that the statements `(1) were made with knowledge of their falsity, and (2) were material to the determination to grant the application.'" Audiovox Corp. v. Monster Cable Prods., Inc., 544 F.Supp.2d 155, 158 (E.D.N.Y.2008) (quoting West Indian Sea Island Cotton Ass'n Inc. v. Threadtex, Inc., 761 F.Supp. 1041, 1052 (S.D.N.Y. 1991)); see also Tuccillo v. Geisha NYC, LLC, 635 F.Supp.2d 227, 241-42 (E.D.N.Y. 2009) (same); City of N.Y. v. Tavern on the Green, L.P., 427 B.R. 233, 242 (S.D.N.Y. 2010) ("In order to succeed on its petition for cancellation, [the plaintiff] must establish misstatements that indicate a deliberate attempt to mislead the [US]PTO and were with respect to a material fact — one that would have affected the [US]PTO's action on the application." (alterations, emphasis, and internal quotations omitted)). "Stated another way, the concept of fraud upon the [USPTO] involves a willful withholding by the applicant, with intent to deceive, of material facts which, if disclosed, would result in refusal by the [USPTO] to register the mark." Buti v. Impressa Perosa, S.R.L., 935 F.Supp. 458, 474 (S.D.N.Y.1996) (internal quotation marks omitted), aff'd, 139 F.3d 98 (2d Cir. 1998). "Misstatements in a registration application will result in cancellation only if the statements were made with knowledge of their falsity and were material to the decision to grant the application." Audiovox Corp., 544 F.Supp.2d at 158. Moreover, "fraud must be proven by clear and convincing evidence." Id. at 158-59.
"Relief under § 1120 requires that the parties' injuries result from the use of the mark while falsely registered." Martal Cosmetics, Ltd. v. Int'l Beauty Exch. Inc., No. 01-CV-7595, 2007 WL 895697, at *30 (E.D.N.Y. Mar. 22, 2007) (internal quotation marks omitted). It is insufficient for a defendant to claim that it has "been damaged in the amount of their legal fees and costs." Id. It is not the case,
In its application to the USPTO, NWS represented the Mark had been in use in commerce at least as of June 21, 2007.
Furthermore, there are material issues of fact as to whether Plaintiff's omission
Finally, NameMedia argues that this case should be deemed "exceptional" pursuant to 15 U.S.C. § 1117(a) — and NameMedia should accordingly be awarded attorneys' fees — because "the futility of Plaintiff's case was brought to ... Coyne's attention prior to bringing the [A]ction" and because of the "bad faith manner in which [the Action] was maintained." (Def.'s Summ. J. Mem. 21.)
The Lanham Act provides that "[t]he court in exceptional cases may award reasonable attorney fees to the prevailing party." 15 U.S.C. § 1117(a). The Second Circuit has interpreted "exceptional cases" to include cases involving "fraud or bad faith," which, in turn, includes "fraudulent conduct in the course of conducting trademark litigation." Patsy's Brand, Inc. v. I.O.B. Realty, Inc., 317 F.3d 209, 221-22 (2d Cir.2003) (internal quotation marks omitted); see also Louis Vuitton Malletier S.A. v. LY USA, Inc., 676 F.3d 83, 111 (2d Cir.2012) (explaining that attorney fees are allowable under § 1117(a) on evidence of fraud or bad faith and that "the key is willfulness on the part of the defendants").
To begin, it is unclear whether NameMedia presses the claim that the case is exceptional, at least at this time. NameMedia's memorandum filed in support of its Motion for Summary Judgment states that "[g]iven the sheer volume of Plaintiff's vexatious behavior," NameMedia "requests the opportunity to brief the exceptionality issue separately [following a status conference on May 28, 2013]," and makes clear that it is only seeking summary judgment dismissing all of Plaintiff's claims, "as this entire case is based on Plaintiff's misstatements." (Def.'s Summ. J. Mem. 22 & n.20.) At the May 28, 2013 conference, the Court granted Coyne's motion to withdraw as counsel for NWS, (May 28, 2013 Hr'g Tr. 40-42), and although Defendant stated its intention to "file for Rule 11" against Coyne, (id.), it did not raise the issue of "exceptionality" or request permission to separately brief the issue. However, NameMedia further briefed the issue in its Memorandum in Opposition to Plaintiff's Cross-Motion for Summary Judgment and in Further Support of Defendant's Motion for Summary Judgment. (See Def.'s Summ. J. Reply 14-15.) In particular, NameMedia argues that NWS's "bad faith" pursuit of the lawsuit can be inferred from (1) the fact that NWS "was in possession
The Court agrees with NameMedia that there is, at the very least, circumstantial evidence of bad faith here. To begin, NameMedia's statement that bad faith can be inferred from the fact that NWS "was in possession of no evidence that Plaintiff made use of the Mark prior to March 2005" and yet prosecuted this Action "knowing ... [it] had to demonstrate trademark priority as of March 2005 to prevail on its claims," (Def.'s Summ. J. Reply 15), is not entirely accurate. As discussed above, the relevant inquiry as to Plaintiff's trademark claims is not whether or not there was a valid trademark at the time of the infringing conduct, but rather, whether the mark was in use. Nevertheless, Defendant correctly points out that Plaintiff had no evidence that it had made use of the Mark prior to Defendant's registration of the Domain Name, and yet chose to instigate the Action. This supports a finding of bad faith. Further, the undisputed facts that Plaintiff knew of the Domain Name in 2007, waited until 2010 to contact Defendant, asked for a price quote, and, when it received the price quote, instead of responding to Defendant, filed an application to the USPTO four hours later are at least suggestive of a bad faith motive in instigating this litigation. Finally, NWS's conduct in this Action supports an inference of bad faith, as discussed in detail above. Plaintiff did not produce Coyne for a deposition, did not depose several witnesses Defendant identified as relevant, choosing, instead, to rely on unsubstantiated and unqualified claims by Neal, and proffered evidence that was responsive to Defendant's discovery demands for the first time in connection with its Motion for Summary Judgment.
Nevertheless, even though there is circumstantial evidence of bad faith, there is no direct evidence of bad faith, and, in the absence of direct evidence, the Court does not deem that this case is "exceptional" within the meaning of 15 U.S.C. § 1117(a). See Cartier, Inc. v. Four Star Jewelry Creations, Inc., 348 F.Supp.2d 217, 254 (S.D.N.Y.2004) ("Although the court concludes that defendants acted in bad faith, the court is not prepared to term this case `exceptional,' and therefore this aspect of plaintiffs' requested relief will not be granted."); cf. Scholastic, Inc. v. Stouffer, 221 F.Supp.2d 425, 444 (S.D.N.Y.2002) (finding the case exceptional where the defendant "asserted claims and defenses without any reasonable basis in fact or law and ... attempted to support such claims and defenses with items of evidence that have been created or altered for purposes of [the] litigation"), aff'd, 81 Fed.Appx. 396 (2d Cir.2003); Ptak Bros. Jewelry, Inc. v. Ptak, No. 06-CV-13732, 2009 WL 1514469, at *4 (S.D.N.Y. June 1, 2009) (deeming the case exceptional where the "defendants in bad faith created multiple difficulties in the litigation, including moving to file patently frivolous defenses and counterclaims, claiming to be represented by counsel when the representation
For the reasons stated herein, NameMedia's Motion to Strike is granted in part and denied in part, NWS's Motion to Strike is granted in part and denied in part, NameMedia's Motion for Summary Judgment is granted with respect to NWS's claims and denied with respect to NameMedia's counterclaims, NWS's Motion for Summary Judgment is denied, and NameMedia's request for a declaration that this case is "exceptional" pursuant to the Lanham Act 15 U.S.C. § 1117 is denied. The Clerk of Court is respectfully directed to terminate the pending Motions.
SO ORDERED.
