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April 3, 2014

Indiana Trademark Litigation: Noble Roman’s Sues for Trademark Infringement

Indianapolis, Indiana – An Indiana trademark attorney for Noble Roman’s, Inc. of Indianapolis, Indiana filed a lawsuit in the Southern District of Indiana alleging that Sahara Sam’s Indoor Water Park, LLC of Pennsauken, New Jersey (“Sahara”) infringed its trademarks. These trademarks are: Noble Roman’s®, Trademark Registration No. 987,069; THE BETTER PIZZA PEOPLE, Trademark Registration No. 1,920,428; and a design mark, Trademark Registration No. 1,682,308. Noble Roman’s also states that it has registered the Tuscano’s® mark. In addition to trademark infringement, Noble Roman’s asserts that Sahara engaged in false designation of origin and unlawful competition. Noble Roman’s has registered its marks with the U.S. Patent and Trademark Office.

Noble Roman’s is in the business of franchising the operation of Noble Roman’s pizza franchises that feature pizza, breadsticks, and other related food items to various franchisees throughout the world. Noble Roman’s has used its trademarks, among them “Noble Roman’s” and “The Better Pizza People,” registered in 1974 and 1995, respectively, in commerce in connection with marketing, identifying, and promoting its pizza franchises.

On or about June 27, 2005, Noble Roman’s and entered into two franchise agreements. Under the terms of the agreements, Sahara became a franchisee of Noble Roman’s, licensed and authorized to sell “Noble Roman’s” and “Tuscano’s” branded food products using Noble Roman’s intellectual property assets. Noble Roman’s asserts that these agreements included terms relating to the accurate reporting of sales and timely payment of franchise fees and other fees.

Sahara is accused of failing to pay royalties as required under the agreement and of misreporting sales, among other things. Noble Roman’s contends that Sahara purposely, intentionally and knowingly misreported its sales to Noble Roman’s for the purpose of avoiding payment of franchise fees and/or royalties which were due.

Noble Roman’s also contends that, after electing not to renew the franchise agreements, Sahara violated certain post-termination provisions of the Agreements, including those which require Sahara to: (1) cease to use any Noble Roman’s proprietary products; and (2) remove from public view and display any signage or other articles containing or depicting the trademarks.

Sahara is further accused of having violated the non-competition covenants by selling, after termination of the franchise agreements, various food items “which can be utilized without knowledge gained from Noble Roman’s.”

Noble Roman’s states that Sahara’s actions were without the authorization or consent of Noble Roman’s and that they constitute trademark infringement, in violation of 15 U.S.C. § 1114(1), as well as false designation of origin in violation of 15 U.S.C. § 1125.

The complaint, filed by an Indiana trademark lawyer, lists the following:

• Count One (Trademark Infringement)
• Count One [sic] (Breach of Contract)
• Count Two (Fraud)
• Count Three (Injunctive Relief)

Noble Roman’s asks for injunctive relief, as well as judgment in its favor in amount to be proven at trial, together with interest, punitive damages, costs of collection and reasonable attorney’s fees.

Practice Tip: Noble Roman’s has been particularly aggressive in enforcing franchise agreements. Since 2007, it has also filed the following suits in the Southern District of Indiana:

February 12, 2014 – NOBLE ROMAN’S, INC. v. B & MP and LESLIE PERDRIAU

September 5, 2012 – NOBLE ROMAN’S, INC. v. VILLAGE PANTRY

March 17, 2011 – NOBLE ROMAN’S, INC. v. FINDLAY TIFFIN OIL, LLC and AYMAN MAGDADDI

January 27, 2011 – NOBLE ROMAN’S INC. et al. v. BRABHAM OIL COMPANY and BRABHAM OIL COMPANY

October 9, 2009 – NOBLE ROMAN’S, INC. v. CITY CENTER FOOD CORP., INC.

August 31, 2009 – NOBLE ROMAN’S INC. v. W.J. INTERNATIONAL GROUP, LLC

July 17, 2009 – NOBLE ROMAN’S, INC. v. MARDAN, INC.

July 8, 2009 – NOBLE ROMAN’S, INC. v. RENTON WILLIAMS

April 21, 2009 – NOBLE ROMAN’S, INC. v. RICHARD A. GOMES and RRCM FOODS, INC.

April 2, 2009 – NOBLE ROMAN’S, INC. v. KANDAKAR ALAM

February 17, 2009 – NOBLE ROMAN’S, INC. v. EXPRESS LANE, INC.

February 10, 2009 – NOBLE ROMAN’S, INC. v. JJP&L, LLC

November 6, 2008 – NOBLE ROMAN’S, INC. v. PARDIS & ASSOCIATES, INC.

October 24, 2008 – NOBLE ROMAN’S, INC. v DELTA PROPERTY MANAGEMENT LLC, ZACK BROTHERS TRUCK STOP, LLC and STANDARD PETROLEUM CORP.

October 6, 2008 – NOBLE ROMAN’S INC. v. JAY’S GAS LLC

April 9, 2008 – NOBLE ROMAN’S, INC. v. SHAHRAM RAHIMIAN

March 17, 2008 – NOBLE ROMAN’S, INC. v. MEDALLION CONVENIENCE STORES, INC.

December 20, 2007 – NOBLE ROMAN’S, INC. v. MICHAEL J. BRUNSWICK, LAURIE BRUNSWICK, and M&L RESTAURANTS, LLC

September 17, 2007 – NOBLE ROMAN’S, INC. v. THE FRENCH BAGUETTE, LLC et al.

July 26, 2007 – NOBLE ROMAN’S, INC. v. MR. RON’S, L.C.

July 19, 2007 – NOBLE ROMAN’S INC. v. BAUER BUILT, INC. et al.

March 12, 2014

Supreme Court Reverses Federal Circuit on Burden of Proof in Patent Infringement Litigation Brought Under the Declaratory Judgment Act

By Overhauser Law Offices, LLC

Washington, D.C. – An issue in the patent infringement dispute between medical-device giant Medtronic, Inc. and Mirowski Family Ventures, LLC (“Mirowski”) was heard by the United States Supreme Court. In question was the placement of the burden of proof in patent infringement litigation that seeks a declaratory judgment. The Supreme Court reversed the U.S. Court of Appeals for the Federal Circuit, holding that the burden of proof of infringement rests with the patent holder even if the lawsuit is filed under the Declaratory Judgment Act.

After hearing arguments by patent attorneys for each side, the district court had held that Mirowski, the party asserting infringement, had the burden of proving patent infringement; it found that Mirowski had not met that burden.

The Federal Circuit reversed. It concluded that, when a patentee (Mirowski) is a declaratory judgment defendant and is also prevented from asserting an infringement counterclaim by the existence of a license between the parties – as Mirowski was – the party seeking the declaratory judgment (Medtronic) bears the burden of proving that it had not infringed the patent.

The Supreme Court granted certiorari. The question before the Court was “whether the burden of proof shifts when the patentee is a defendant in a declaratory judgment action, and the plaintiff (the potential infringer) seeks a judgment that he does not infringe the patent.”

Mirowski argued that it would be unfair to place a burden of proof on the party that was not seeking relief. The Intellectual Property Owners Association supported Mirowski’s position, contending that a failure to shift the burden of proof in such cases would lead to abuse of declaratory judgment actions, as the risks and burdens of patent infringement litigation would be placed entirely on the patent owner.

In contrast, Medtronic argued that placing the burden on a licensee would create an unacceptable choice between finality and fairness, as it would require the judicial system to permit a party to relitigate issues that had been previously decided under a different burden of proof.

The Supreme Court reversed the shifted burden of proof imposed by the Federal Circuit. The Court declared that it saw “no convincing reason why burden of proof law should favor the patentee” simply because it was filed under the Declaratory Judgment Act.

Practice Tip #1: It is settled law that, in patent infringement litigation, a patentee normally bears the burden of proof. Because 1) the operation of the Declaratory Judgment Act is only procedural and leaves substantive rights unchanged and 2) the burden of proof is a substantive aspect of a claim, this holding by the Supreme Court is not unanticipated.

Practice Tip #2: When drafting the terms of a license, patent owners should consider adding provisions to deter potential challenges by licensees.

Practice Tip #3: We have also blogged recently about another declaratory judgment case involving Mirowski, which is being heard in the Southern District of Indiana.

February 28, 2014

PC Ruehl Engineering Sues AM General for Patent Infringement of Humvee Frame Rail Assembly

By Overhauser Law Offices, LLC

South Bend, Indiana – Indiana and Wisconsin patent attorneys for Phillip C. Ruehl of Wauwatosa, Wisconsin (“Ruehl”) and PC Ruehl Engineering, Inc. of Wisconsin (“PC Ruehl”) filed patent infringement litigation in the Northern District of Indiana alleging that AM General LLC of South Bend, Indiana infringed Boxed Frame Member and Method for Manufacture, Patent No. 8,484,930 B2 (the “‘930 Patent”), which has been issued by the U.S. Patent Office.

From 1969 to 2001, Ruehl was employed as an automotive frame chassis engineer. In his various positions, including as a manager of product design, Ruehl’s responsibilities included contributing to the designs of many light truck and sport utility vehicle frames.

Since the early 1980s, AM General has manufactured for the United States military, and eventually for the militaries of many other countries around the world, a High Mobility Multi-Purpose Wheeled Vehicle (or HMMWV, also known as the Humvee).

In November 2004, an employee of AM General allegedly contacted Ruehl to inquire if Ruehl was interested in consulting on a project to upgrade the frame rails for AM General’s Humvee line of trucks. The employee described the frame rail project objectives to Ruehl and sent drawings to Ruehl showing the current side rail design.

From December 2004 through February 2005, Ruehl indicates that he studied the drawings and began to consider ways to meet AM General’s objectives so that he could add value if and when AM General decided it wanted to retain him as a consultant. He contends that he was neither under contract with AM General nor was he being paid or otherwise compensated by AM General during this time.

Ruehl states in his complaint that he began to consider several potential solutions which he believed to be the most efficient means of solving the stated challenges. He sketched up many of these potential solutions so that he would remember each and be able to explain how he would proceed with each idea if he were asked. One of the new solutions Ruehl conceived of and sketched was a design that solved many of the unique dimensional and quality problems that AM General was experiencing with its current frame rail design (the “Invention”).

AM General allegedly was never invoiced and never paid Ruehl for the work he did during this preparation period. Instead, Ruehl states that AM General specifically told him that the rail design program itself was tentative, and that if it did go forward, he would not be “on board” and under contract until he had met with representatives of AM General and signed additional documents at AM General’s Michigan facility.

In February 2005, having allegedly already conceived of the Invention, PC Ruehl received from AM General a purchase order dated February 24, 2005 for “engineering support for HMMWV frame rail feasibility study.” Under this purchase order, AM General asked Ruehl to provide engineering support for a feasibility study and stated that PC Ruehl would be paid $150 per hour for Ruehl’s efforts. Ruehl signed the purchase order on behalf of PC Ruehl.

In March 2005, Ruehl drew a more detailed, presentable, and buildable sketch illustrating the Invention in its preferred embodiment, and had the owner of a Milwaukee-area prototype shop confirm its manufacturability, witness it, and agree to build a small “proof-of-concept” sample. Ruehl states that he did not bill, and was not paid by, AM General for this work.

Ruehl then brought the Invention to a meeting with AM General. Before beginning the substance of the meeting, Ruehl states that he (on behalf of PC Ruehl) and AM General signed a Mutual Confidentiality Agreement. This agreement provided that all confidential information disclosed by Ruehl to AM General and by AM General to Ruehl would “remain the property of [the] Disclosing Party[.]” “Confidential Information” was defined in the agreement as “[a]ny information that has value to the Disclosing Party and is not generally known to its competitors,” and specifically included “ideas, concepts, plans,…drawings,…products, processes[.]” Moreover, the agreement stated, “Nothing contained in this Agreement shall be construed as granting or conferring to Receiving Party any patent rights or licenses from Disclosing Party either expressly or by implication[.]”

Following this agreement, Ruehl worked with AM General to provide engineering support services for the frame rail feasibility study. Ruehl was paid for this work pursuant to the February 2005 purchase order. Ruehl also provided additional engineering support services to AM General under an April 2005 purchase order. Ruehl contends that AM General never paid him or PC Ruehl for the transfer of ownership of Ruehl’s Invention.

On November 1, 2005, Ruehl filed a patent application on the Invention, Provisional Patent Application No. 60/732,451. Ruehl followed that application with a non-provisional patent application, Patent Application Serial No. 11/279,321, on April 11, 2006.

AM General filed its own patent application on Ruehl’s Invention, filing Provisional Patent Application Serial No. 60/764,045 on February 1, 2006, and non-provisional patent application Serial No. 11/670,217, on February 1, 2007.

On November 1, 2005, the day that Ruehl filed the provisional patent application, he informed AM General of the filing and of his expectation of receiving royalties for the use of his Invention. Conversely, AM General has purportedly advised Ruehl that it is AM General’s position that Ruehl had an obligation to assign his rights in the Invention to AM General.

On July 16, 2013, the United States Patent and Trademark Office issued the ‘930 Patent to Ruehl. Ruehl now contends that AM General has incorporated Ruehl’s Invention into the frame rail assembly it is now using for its Humvee which it is manufacturing and selling to the United States Military and to others.

At issue in this Indiana patent litigation are the following:

• Count I: Infringement of the ‘930 Patent, and
• Count II: Breach of Contract.

Ruehl and PC Ruehl, via patent counsel, ask the court for a judgment that AM General has directly infringed and continues to infringe the ‘903 Patent; damages, including treble damages; a judgment that AM General’s infringement has been willful; an injunction enjoining AM General from infringing the ‘930 Patent; a declaration that this case is exceptional; costs and fees.

Practice Tip: The U.S. Patent and Trademark Office provides for the recordation of assignments of applications, patents, and registrations. The patent assignment abstract of title shows that an interest in this patent was assigned from Ruehl to AM General in 2008. In 2010, another assignment of this patent was executed from AM General to Ruehl. In 2011, an assignment from AM General to itself was filed to correct error. Finally, in 2013, a second assignment to correct error, this time to and from Ruehl, was executed.

February 27, 2014

James Dean, Inc.’s Indiana Trademark Infringement Litigation Against Twitter Removed to Federal Court

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Illinois and Missouri trademark attorneys for James Dean, Inc. of Indiana sued in Indiana state court alleging that Twitter, Inc. of California infringed the trademark James Dean, which has been issued by the U.S. Trademark Office by allowing the registration of the Twitter handle @JamesDean. The case was removed from the Superior Court of the County of Hamilton, Indiana to the Southern District of Indiana.

Plaintiff James Dean, Inc. filed a trademark complaint against Twitter, as well as the fictitious persons, John Doe Defendants 1-5 Company, in an Indiana state court. In the complaint, Plaintiff alleged that it is the exclusive owner of the name, likeness, voice, right of publicity and endorsement, worldwide trademarks, copyrights, and other intellectual property including but not limited to visual and aural depictions, artifacts, memorabilia, and life-story rights, and/or trade dress of the late movie star James Dean.

James Dean, Inc. further alleges that Twitter has allowed the registration and operation of a Twitter account, using the handle @JamesDean, located at https://twitter.com/JamesDean, which is purportedly in violation of Plaintiff’s rights.

In the complaint, filed by an Indiana trademark lawyer, James Dean, Inc. asserted nine causes of action against Twitter:

• Count I – Trademark Infringement Under Section 32(1) or 3(A) of the Lanham Act;
• Count II – False Endorsement Under Lanham Act § 43(A);
• Count III – Indiana State Statutory Right of Publicity;
• Count IV – Common Law Right of Publicity;
• Count V – Common Law Unfair Competition;
• Count VI – Unjust Enrichment;
• Count VII – Conversion;
• Count VIII – Deception; and
• Count IX – Indiana Crime Victims’ Act.

For relief, James Dean, Inc. sought damages, including treble damages, costs, and attorney’s fees as set out in the Indiana Right of Publicity Statute, Lanham Act and other statutes. In addition, Plaintiff seeks injunctive relief.

Twitter removed the action pursuant to 28 U.S.C. § 1331 (federal-question jurisdiction) and 28 U.S.C. § 1332 (diversity-of-citizenship jurisdiction). To support the former basis for federal jurisdiction, Twitter noted federal questions inherent in the filing of a claim under the Lanham Act. Twitter also claimed supplemental jurisdiction for the remaining claims under Indiana law.

To support the latter basis for jurisdiction in an Indiana federal court, Twitter asserted that the two prongs for diversity-of-citizenship jurisdiction were met. First, James Dean, Inc. is a citizen of Indiana, as it has alleged that it is incorporated under the laws of the State of Indiana with its principal place of business in Indiana, while Twitter claims to be a citizen of two states: Delaware and California. Second, while Twitter “strongly contests liability and does not believe Plaintiff is entitled to any relief whatsoever,” it indicated that, were liability to be found, the amount in controversy could exceed $75,000, given that James Dean, Inc. is suing for “all damages” allowed by the applicable statutes, which can include actual damages, treble damages, punitive damages, statutory damages and attorneys’ fees.

Practice Tip:

James Dean was born on February 8, 1931, in Marion, Indiana. He grew up in Fairmount, Indiana, about 60 miles northeast of Indianapolis. Dean starred in East of Eden, Rebel Without a Cause and Giant, receiving two Academy Award nominations for Best Actor.

In 1955, Dean died in an automobile accident. As a result of the nearly 60 years that have passed since his death, it is unlikely that those who follow @JamesDean believe that the tweets have been written by James Dean himself. Nonetheless, celebrity licensing agency CMG Worldwide, based out of Carmel, Indiana, is attempting to recover the James Dean Twitter account.

CMG, which also represents such celebrity images as Marilyn Monroe, Jackie Robinson and Babe Ruth, has attempted “on numerous occasions” to make Twitter take action to block and identify owners of various unauthorized accounts. Those accounts could give the impression, it says, that the users have permission from the estates of the celebrities or CMG and “result in immeasurable and irreparable damage.”

Finally, most of the James Dean trademarks that were registered by the U.S. Trademark Office have been either abandoned or cancelled. It will be interesting to see to what degree this fact influences the court, should liability be established and a calculation of damages be appropriate.

February 24, 2014

Union Hospital Sues Attachmate Seeking a Declaration of Non-Infringement

By Overhauser Law Offices, LLC

Terre Haute, Indiana – Copyright attorneys for Union Hospital, Inc. of Terre Haute, Indiana filed an Indiana copyright lawsuit against Attachmate Corporation of Seattle, Washington in the Southern District of Indiana asking the court to declare that Union Hospital had not infringed either of two Attachmate software works titled “EXTRA!” and “Reflection”, Copyright Registration Nos. TX0005717997 and TX0007351951, which were issued by the U.S. Copyright Office.

Union Hospital, a not-for-profit regional hospital, provides healthcare to residents of the Wabash Valley community, regardless of their ability to pay. Attachmate is one of the largest software companies in the world, with 40 offices doing business in 145 countries.

Union Hospital states that, since at least 1997, it has been licensed to use Attachmate software for which it paid tens of thousands of dollars. In 2013, Attachmate conducted an audit of Union Hospital’s use of Attachmate software products. According to the complaint, as a result of this audit, Attachmate determined that Union Hospital had used the software beyond the terms of the licenses and demanded that Union Hospital pay Attachmate over $2,000,000 in license fees, interest and other charges. Union Hospital indicates Attachmate subsequently threatened to initiate copyright infringement litigation against Union Hospital.

The claims of liability which Attachmate apparently made have been attacked by Union Hospital on several grounds. Union Hospital states that the claim of over-deployment of certain software was based not upon the actual usage of Attachmate’s product, but upon the potential total number of users who could have used Attachmate software on Union Hospital’s server regardless of whether the user ever accessed or used the product. Union Hospital further asserts “estoppel, waiver, laches, and/or acquiescence” in its defense.

This Indiana litigation, filed under the Declaratory Judgment Act, was filed by Indiana copyright lawyers for Union Hospital. The complaint lists three causes of action:

1. Declaratory Judgment on Copyright Infringement Claims
2. Declaratory Judgment on Copyright Infringement Claims for Unregistered Copyrights
3. Declaratory Judgment on Breach of Contract Claims

Union Hospital asks the court to:
a. Declare that one or more of Attachmate’s breach of contract claims are preempted by the Copyright Act;
b. Declare that Attachmate’s asserted license agreements are invalid and unenforceable;
c. Declare that Union Hospital is not liable to Attachmate for copyright infringement, as Union Hospital’s use of Attachmate’s software was licensed;
d. Declare that Attachmate’s copyright infringement and/or breach of contract claims are barred by estoppel, waiver, laches, and/or acquiescence;
e. Declare that Attachmate’s copyright infringement and/or breach of contract claims are barred by the applicable statute(s) of limitations;
f. Declare that, if Attachmate’s claims are allowed to proceed, any damages for Attachmate’s copyright and/or breach of contract claims be substantially reduced due to Attachmate’s failure to mitigate its damages;
g. Declare that Attachmate’s alleged copyrights were not timely registered and therefore Attachmate is barred from seeking statutory damages and attorneys’ fees for its copyright infringement claims;
h. Declare that Attachmate’s copyright infringement claims based on unregistered copyrights are barred; and
i. Alternatively, declare that Attachmate’s is only entitled to de minimis damages because Union Hospital’s uses did not exceed the total number of uses that it contracted for with Attachmate.

Practice Tip:

The use of the compound conjunction “and/or” in this complaint raises some interesting possibilities. As one basis for federal jurisdiction, Plaintiff alleges that “Attachmate’s representatives have expressly or impliedly threatened litigation for breach of contract and/or copyright infringement….” Such an assertion may not be sufficient to invoke federal-question jurisdiction, as it claims that the threat of litigation exists for one of three possible circumstances: breach of contract only, copyright infringement only, or both breach of contract and copyright infringement. Under the first scenario – breach of contract only – no federal jurisdiction would lie. This potential problem may be remedied by other allegations in the complaint, including a separate assertion of diversity jurisdiction.

The use of “and/or” is also found in the prayer for relief. There, Plaintiff asks for, inter alia, declarations “that Attachmate’s copyright infringement and/or breach of contract claims are barred by estoppel, waiver, laches, and/or acquiescence” and “that Attachmate’s copyright infringement and/or breach of contract claims are barred by the applicable statute(s) of limitations.” Again, this use of the compound conjunction leaves open the possibility that the court might interpret the prayer for relief as a request to bar the claims of breach of contract or copyright infringement, but not both.

February 20, 2014

Noble Roman’s Sues Another Indiana Franchisee Alleging Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – An Indiana trademark attorney for Noble Roman’s, Inc. of Indianapolis, Indiana sued in the Southern District of Indiana alleging that B & MP, LLC (which was dissolved in 2011) and Leslie Perdriau of Apple River, Illinois (collectively, “B & MP”) infringed the trademark Noble Roman’s, Registration No. 987,069, as well as the trademark, The Better Pizza People, Registration No. 1,920,428. Noble Roman’s also lists a design mark, Registration No. 1,682,308 in its complaint. All of the marks have been registered by the U.S. Trademark Office.

Noble Roman’s is in the business of franchising the operation of Noble Roman’s pizza franchises that feature pizza, breadsticks, and other related food items to various franchisees throughout the world. Noble Roman’s has used its trademarks, among them “Noble Roman’s” and “The Better Pizza People,” registered in 1974 and 1995, respectively, in commerce in connection with marketing, identifying, and promoting its pizza franchises.

On or about March 16, 2010, Noble Roman’s and B & MP entered into two franchise agreements. Under the terms of the agreements, B & MP became a franchisee of Noble Roman’s licensed and authorized to sell “Noble Roman’s” and “Tuscano’s” branded food products using Noble Roman’s intellectual property assets. These agreements included terms relating to the accurate reporting of sales and timely payment of franchise and other fees.

B & MP is accused of failing to pay royalties as required under the agreement and of misreporting sales, among other things. Noble Roman’s contends that B & MP purposely, intentionally and knowingly misreported its sales to Noble Roman’s for the purpose of avoiding payment of franchise fees and/or royalties which were due.

Noble Roman’s also states that B & MP used the Noble Roman’s trademarks in connection with the sale of non-Noble Roman’s pizza and other menu items and that such use of the trademarks was without the authorization or consent of Noble Roman’s. Those acts were asserted to constitute trademark infringement, in violation of 15 U.S.C. § 1114(1), as well as a false designation of origin in violation of 15 U.S.C. § 1125.

Although the complaint lists two Defendants, Noble Roman’s states that Defendant B & MP was involuntarily dissolved in 2011 and that Defendant Leslie Perdriau succeeded to its obligations.

The complaint, filed by an Indiana trademark lawyer, lists the following:

• Count One (Trademark Infringement)
• Count One [sic] (Breach of Contract)
• Count Two (Fraud)

Noble Roman’s asks for judgment in its favor in amount to be proven at trial, together with interest, punitive damages, costs of collection and reasonable attorneys’ fees.

Practice Tip: Noble Roman’s has been particularly aggressive in enforcing franchise agreements. Since 2007, it has also filed the following suits in the Southern District of Indiana:

September 5, 2012 – NOBLE ROMAN’S, INC. v. VILLAGE PANTRY

March 17, 2011 – NOBLE ROMAN’S, INC. v. FINDLAY TIFFIN OIL, LLC and AYMAN MAGDADDI

January 27, 2011 – NOBLE ROMAN’S INC. et al. v. BRABHAM OIL COMPANY and BRABHAM OIL COMPANY

October 9, 2009 – NOBLE ROMAN’S, INC. v. CITY CENTER FOOD CORP., INC.

August 31, 2009 – NOBLE ROMAN’S INC. v. W.J. INTERNATIONAL GROUP, LLC

July 17, 2009 – NOBLE ROMAN’S, INC. v. MARDAN, INC.

July 8, 2009 – NOBLE ROMAN’S, INC. v. RENTON WILLIAMS

April 21, 2009 – NOBLE ROMAN’S, INC. v. RICHARD A. GOMES and RRCM FOODS, INC.

April 2, 2009 – NOBLE ROMAN’S, INC. v. KANDAKAR ALAM

February 17, 2009 – NOBLE ROMAN’S, INC. v. EXPRESS LANE, INC.

February 10, 2009 – NOBLE ROMAN’S, INC. v. JJP&L, LLC

November 6, 2008 – NOBLE ROMAN’S, INC. v. PARDIS & ASSOCIATES, INC.

October 24, 2008 – NOBLE ROMAN’S, INC. v DELTA PROPERTY MANAGEMENT LLC, ZACK BROTHERS TRUCK STOP, LLC and STANDARD PETROLEUM CORP.

October 6, 2008 – NOBLE ROMAN’S INC. v. JAY’S GAS LLC

April 9, 2008 – NOBLE ROMAN’S, INC. v. SHAHRAM RAHIMIAN

March 17, 2008 – NOBLE ROMAN’S, INC. v. MEDALLION CONVENIENCE STORES, INC.

December 20, 2007 – NOBLE ROMAN’S, INC. v. MICHAEL J. BRUNSWICK, LAURIE BRUNSWICK, and M&L RESTAURANTS, LLC

September 17, 2007 – NOBLE ROMAN’S, INC. v. THE FRENCH BAGUETTE, LLC et al.

July 26, 2007 – NOBLE ROMAN’S, INC. v. MR. RON’S, L.C.

July 19, 2007 – NOBLE ROMAN’S INC. v. BAUER BUILT, INC. et al.

February 7, 2014

Licensor of “Tiki Tan” Mark Alleges Infringing Use by Solarium and Solarium Bittersweet

By Overhauser Law Offices, LLC

South Bend, Indiana – An Indiana trademark attorney for Al Reasonover of Elkhart, Indiana sued in the Northern District of Indiana alleging that Solarium LLC of South Bend, Indiana (“Solarium”) and Solarium Bittersweet LLC of Elkhart, Indiana (“Solarium Bittersweet”) committed trademark infringement of “Tiki Tan”, Trademark Reg. No. 2602388, which has been registered by the U.S. Patent and Trademark Office.

In this complaint for trademark infringement and unfair competition, Plaintiff Reasonover states that he operates tanning salons under the Tiki Tan Mark and that he also develops tanning salons operated by others to whom he licenses the use of the Mark for a fee. Among these licensees, claims Plaintiff, is Solarium.

Reasonover asserts that, instead of displaying the Tiki Tan Mark as licensed, Solarium displays a service mark at its website reading “Tiki Tan by Solarium”. Reasonover also claims that, while he and Solarium entered into a licensing agreement that permitted Solarium to use the Mark only within a five mile territory around 4542 Elkhart Road, Elkhart, Indiana, Defendants Solarium and/or Solarium Bittersweet are operating additional tanning salons under the name “Tiki Tan” at 306 N. Bittersweet Road, Mishawaka, Indiana; 1290 E. Ireland Road, South Bend, Indiana and 215 E. University Drive, Granger, Indiana.

Plaintiff indicates that the licensing agreement neither permits Solarium to alter the Mark nor to use the Mark outside of the five mile territory around 4542 Elkhart Road, Elkhart, Indiana. He also claims that Solarium’s modification of the Mark to include its own name in connection with the promotion, sale and distribution of tanning salon services infringes on Plaintiff’s rights in his federally registered trademark, in violation of 15 U.S.C. Sec. 1114. Reasonover further alleges that Defendants’ actions are intended to cause, have caused, and are likely to continue to cause, confusion, mistake, deception among consumers, the public, and the industry as to whether Defendants’ services originate from, are affiliated with, sponsored by or endorsed by Plaintiff.

Finally, Defendants are accused of infringing the Mark intentionally, deliberately and willfully. The complaint, filed by an Indiana trademark lawyer, lists the following counts:

• Count I – Trademark Infringement – Injunctive Relief
• Count II – Trademark Infringement – Damages
• Count III – Common Law Trademark Infringement
• Count IV – Common Law Unfair Competition

Reasonover asks the court for:

• a finding that Defendants have violated 15 U.S.C. Sec. 1114; that Defendants have engaged in trademark infringement and unfair competition under the common law of Indiana; and that such conduct has damaged Plaintiff monetarily and in ways not adequately remedied by monetary damages alone;
• an injunction, preliminarily and permanently restraining Defendants from altering the registered Mark, “Tiki Tan,” in any way including but not limited to including the words “by Solarium” with the Mark; operating tanning salons at 306 N. Bittersweet Road, Mishawaka, Indiana; 1290 E. Ireland Road, South Bend, Indiana; or 215 E. University Drive, Granger, Indiana under the name “Tiki Tan”; engaging in any other activity constituting unfair competition with Plaintiff; and engaging in any other activity constituting trademark infringement or which deceives consumers or the public about the origin of services associated with Plaintiff;
• an order for corrective advertising;
• statutory damages or, alternatively, the disgorgement of all profits realized as a result of Defendants’ wrongful acts and also awarding Plaintiff its actual damages;
• a trebling of damages under 15 U.S.C. Sec. 1117;
• Plaintiff’s costs, attorney fees, investigatory fees, and expenses under 15 U.S.C. Sec. 1117; and
• pre-judgment interest on any monetary award.

Practice Tip: A trademark license may be granted by a licensor to a licensee to permit the licensee to use a trademark in a way that would otherwise infringe upon the licensor’s intellectual property rights. A license to use a trademark typically includes various restrictions. Those restrictions may include, among other things, limits on territory, term and manner of use.

January 23, 2014

NCAA Heard in Federal Court Again on Antitrust and Right-of-Publicity Issues

By Overhauser Law Offices, LLC

Oakland, California – District Judge Claudia Wilkin (pictured) issued a new order regarding in re NCAA Student-Athlete Name & Likeness Licensing Litigation, a putative class action involving the Indianapolis-based National Collegiate Athletic Association (“NCAA”). The NCAA’s motion to dismiss on, inter alia, copyright and First-Amendment grounds was denied.

In this action, Plaintiffs, a group of twenty-five current and former college athletes who played for NCAA men’s football or basketball teams between 1953 and the present, pursued a putative class action against Defendant NCAA. They initially brought claims against Collegiate Licensing Company (“CLC”) and Electronic Arts Inc. (“EA”) as well, but agreed to settle those claims before this order was issued.

At the time of this order, four of the Plaintiffs (the “Right-of-Publicity Plaintiffs”) alleged that the NCAA misappropriated their names, images and likenesses in violation of their statutory and common law rights of publicity. In contrast, the other twenty-one Plaintiffs (the “Antitrust Plaintiffs”) alleged that the NCAA violated federal antitrust law by conspiring with EA and CLC to restrain competition in the market for the commercial use of their names, images and likenesses. This order addressed only the latter set of claims, which arise under the Sherman Antitrust Act, 15 U.S.C. § 1 et seq.

To be eligible to compete, the NCAA required student athletes to release in perpetuity all rights to the commercial use of their images. The Antitrust Plaintiffs contend that the “purposefully misleading” release forms then allowed the NCAA to sell or license the athletes’ identities to others.

In addition to the release that the athletes had signed, a price-fixing conspiracy/group boycott prevented the athletes from being able to pursue compensation for the licensing of their identities even after they stopped competing. This allegedly interfered with their ability to market “group licensing rights” for their identities in game broadcasts, rebroadcasts and video games. Because many of these Plaintiffs also went on to play professionally, such rights could be of considerable value.

Intellectual property attorneys for the NCAA argued that assertions of a right of publicity of student athletes in the context of game broadcasts were barred by the First Amendment as well as California statute. The court was not persuaded by either argument. On the First Amendment argument, the court held that, while the original broadcast might enjoy protection, “subsequent unauthorized reproductions” did not.

Likewise, the California statute cited by the intellectual property lawyers for the NCAA was not persuasive to the court. That statute provided that the athletes had no right of publicity in the “use of [his or her] name, voice, signature, photograph, or likeness in connection with any news, public affairs, or sports broadcast or account.” However, the court held that such right-of-publicity restrictions did not apply to licensing in other states that lacked similar statutes.

The court also rejected the NCAA’s copyright-preemption argument on two grounds. First, this was not properly considered under the law of copyright. The athletes were not asserting intellectual property rights under copyright law but rather sought to license their personas. As a persona cannot be copyrighted, copyright preemption did not apply. Moreover, the Plaintiffs’ claims were not of simple theft of intellectual property. They also asserted a broader antitrust right – to prevent injury to competition. Citing United States v. Microsoft Corp., 253 F.3d 34, 63 (D.C. Cir. 2001), the court stated, “[I]ntellectual property rights do not confer a privilege to violate the antitrust laws” and denied the NCAA’s motion to dismiss.

Practice Tip: The NCAA has been heard before on claims under the Sherman Act. NCAA v. Board of Regents, 468 U.S. 85 (1984). In that decision, the Court acknowledged that the NCAA must be given some leeway to adopt anticompetitive rules violating the Sherman Act, concluding that intercollegiate athletics is “an industry in which horizontal restraints on competition are essential if the product is to be available at all.”

January 8, 2014

Court Strikes Four Affirmative Defenses of BitTorrent Defendant

By Overhauser Law Offices, LLC

Fort Wayne, Indiana – District Magistrate Judge Roger B. Cosbey struck four affirmative defenses asserted by anonymous Defendant John Doe in Plaintiff Malibu Media’s lawsuit in the Northern District of Indiana for copyright infringement.

Plaintiff Malibu Media, LLC, filed a copyright infringement action against Defendant John Doe. Defendant answered with ten affirmative defenses. Malibu Media sought to strike four of those defenses–laches, unclean hands, waiver, and estoppel; failure to mitigate damages; failure to join an indispensable party; and implied license, consent, and acquiescence.

Plaintiff first moved to strike Defendant’s second affirmative defense–that “Plaintiff’s claims are barred by the equitable doctrines of laches, unclean hands, waiver and estoppel”–as a bare conclusory allegation unsupported by any factual basis. The court ordered that defense stricken, stating “[m]erely stringing together a long list of legal defenses…does not do the job of apprising opposing counsel and this Court of the predicate for the claimed defense–which is after all the goal of notice pleading.”

Plaintiff next moved to strike Defendant’s fifth affirmative defense–that Plaintiff did not mitigate its damages. Malibu Media argued that this defense was improper because it had elected to pursue only statutory, rather than actual, damages. The court agreed that a copyright plaintiff’s exclusive pursuit of statutory damages invalidates a failure-to-mitigate defense and struck this affirmative defense.

The court also struck Defendant’s seventh affirmative defense, in which Defendant argued that Plaintiff had failed to join an indispensable party. Defendant asserted that he had not engaged in any infringing activity and Plaintiff has not joined those who had. The court held that Defendant’s assertion that he had not engaged in any improper activity was not an affirmative defense but rather a mere denial of liability. It further held that Defendant was incorrect in asserting that joinder was necessary, holding that the court would be able to adjudicate the matter and “accord complete relief to Plaintiff regardless of whether any other allegedly infringing members were joined in the action.

Finally, Plaintiff asked that Defendant’s eighth affirmative defense as be struck as conclusory. Defendant had asserted that “Plaintiff’s claims are barred by Plaintiff’s implied license, consent, and acquiescence to Defendant because Plaintiff authorized use via Bit Torrent [sic].” The court held that Defendant’s Answer foreclosed the possibility of an implied license defense, as Defendant had denied downloading the copyrighted work. As such, Defendant could not also argue that he had downloaded the copyrighted work with a license.

Practice Tip #1: Generally speaking, motions to strike portions of pleadings are disfavored as they consume scarce judicial resources and may be used for dilatory purposes. Such motions will generally be denied unless the portion of the pleading at issue is prejudicial. When faced with a motion to strike affirmative defenses under Rule 12(f), Indiana federal courts apply a three-part test: (1) whether the matter is properly pled as an affirmative defense; (2) whether the affirmative defense complies with Federal Rules of Civil Procedure 8 and 9; and (3) whether the affirmative defense can withstand a Rule 12(b)(6) challenge. An affirmative defense that fails to meet any of these standards must be stricken.

Practice Tip #2: Defendant did not file a response to Malibu Media’s motion to strike Defendant’s affirmative defenses. For that reason alone, the court could have ruled on the motion summarily under the Northern District’s Local Rule 7-1(d)(4).

Practice Tip #3: Even under the liberal notice pleading standards of the Federal Rules, an affirmative defense must include either direct or inferential allegations as to all elements of the defense asserted. Bare bones conclusory allegations are insufficient. Moreover, laches, waiver, estoppel, and unclean hands are equitable defenses that must be pled with the specific elements required to establish the defense.

Practice Tip #4: An implied license, which Defendant argued as an affirmative defense, arises when (1) a person (the licensee) requests the creation of a work, (2) the creator (the licensor) makes that particular work and delivers it to the licensee who requested it, and (3) the licensor intends that the licensee-requestor copy and distribute his work.

Practice Tip #5: This opinion demonstrates one of the pitfalls of pleading in the alternative. Defendant appears to have tried to argue that he didn’t download the copyrighted material but that, if he had, it was with an implied license from Plaintiff. The court was not persuaded, however, as Defendant’s Answer had denied downloading the copyrighted material with BitTorrent. As a result, Defendant was not permitted to argue also that he downloaded the copyrighted material using BitTorrent but that he had an implied license to do so.

A well-known example of such alternative pleading was demonstrated by Richard Haynes: “Say you sue me because you say my dog bit you. Well, now this is my defense: My dog doesn’t bite. And second, in the alternative, my dog was tied up that night. And third, I don’t believe you really got bit. And fourth, I don’t have a dog.”

December 10, 2013

BMI Sues Roadhouse Bar & Grill and Its Owner for Copyright Infringement

By Overhauser Law Offices, LLC

Hammond, Indiana – Broadcast Music, Inc. of New York, New York (“BMI”), along with the owners of the copyrights to various musical compositions, have filed a copyright infringement lawsuit in the Northern District of Indiana alleging that Stamper Properties, Inc. d/b/a Roadhouse Bar & Grill and R. Bruce Stamper of Valparaiso, Indiana infringed multiple copyrighted works which have been registered by the U.S. Copyright Office.

BMI is a “performing rights society” under 17 U.S.C. § 101 that operates on a non-profit-making basis and licenses the right to publicly perform copyrighted musical compositions on behalf of the copyright owners. The other Plaintiffs in this action own the copyrights to the ten compositions at issue in this lawsuit.

Stamper Properties is an Indiana corporation that operates Roadhouse Bar & Grill, an establishment which is asserted to publicly perform musical compositions and/or cause musical compositions to be publicly performed. BMI contends that Mr. Stamper has the right and ability to supervise the activities of Stamper Properties and that he has a direct financial interest in the company and the restaurant.

BMI and the other Plaintiffs, via this suit filed by a copyright lawyer, have asserted willful infringement of the ten copyrights-in-suit. They further claim that Defendants’ entire course of conduct, including the ongoing unauthorized public performances of the copyrighted works, has caused and is continuing to cause the Plaintiffs great and incalculable damage. They have asked the court for an injunction against further infringement. Plaintiffs also seek statutory damages pursuant to 17 U.S.C. §504(c) and costs, including reasonable attorneys’ fees.

Practice Tip:

Copyright protection is automatic upon creation of an original work, but registration of the copyright is required in order to bring an infringement suit.

The Copyright Act empowers a plaintiff to elect to receive an award of statutory damages between $750 and $30,000 per infringement in lieu of an award representing the plaintiffs’ actual damages and/or the defendants’ profits. In a case where the copyright owner proves that infringement was committed willfully, the court may increase the award of statutory damages to as much as $150,000 per infringed work. A finding of willful infringement will also support an award of attorney’s fees.

Furthermore, not only is the performer liable for infringement, but so is anyone who sponsors the performance. A corporate officer will be found jointly and severally liable with his corporation for copyright infringement if he (1) had the right and ability to supervise the infringing activity, and (2) has a direct financial interest in such activities.