The opinion of the court was delivered by: LEVAL
PIERRE N. LEVAL, U.S.D.J.
This is an application for a preliminary injunction. At a conference on July 18, 1984, counsel acknowledged that they would stand on the written submissions as constituting the complete record of the hearing under Rule 65, F.R. Civ. Proc.
Plaintiff, Miami Gold Productions, Inc., is the producer of a new movie, entitled "Cry of the City". Defendant Gannett Company, Inc., publishes USA Today, a nationally distributed daily newspaper. The complaint alleges breach of contract and false advertising under the Lanham Act, 15 U.S.C. § 1125(a).
The facts are in many respects undisputed.
USA Today is promoting through large notices in its pages a "USA Today - Michael Jackson Victory Concert Tour Ticket Contest". Entrants in the contest need only fill out and send in a coupon (or facsimile) from USA Today. The winners of the drawings are promised free concert tickets to performances of the Jacksons, plus free travel to and accommodations at the place of the concert. The free travel is provided by an airline as a co-sponsor; the accommodations are provided by a co-sponsor hotel chain.
On June 8, 1984, plaintiff USA Today wrote a letter to Michael Franzese, president of Miami Gold, constituting "a formal agreement" providing that Miami Gold would become a co-sponsor of the promotion. Miami Gold was to provide 1,000 sequined right hand gloves (a Michael Jackson hallmark) and 1,000 white satin baseball jackets bearing the USA Today logo on the back. The jackets were to be awarded as drawing prizes in the contest. They were permitted to have "Miami Gold""Cry of the City" written in red glitter on the front.
Under the letter, Miami Gold was to "receive equal to equal billing and consideration" with the other equal sponsors.
The letter closed with the following paragraph
I look forward to a highly successful promotion that will reflect favorably on your outstanding organization, and be consistent with the ethics and ideals of USA TODAY. I understand "Cry of the City" under your leadership has dramatically restored hope to many underprivileged children in Florida.
After the ads had begun to run, defendant learned that a special segment televised on NBC Nightly News under the title "The Mobsters and the Movies" reported that Franzese and Gary Zimmerman (the executive producer of "Cry of the City") were backed on their movie venture by Franzese's father "John "Sonny" Franzese, one of the top Mafia bosses in the country," that "Michael Franzese is now a high-ranking member of an organized crime family, the Columbo Mafia family," that the "elder Franzese and his mob associates were the men behind the distribution of a number of sex and violence films, including "Deep Throat" and "Texas Chain Saw Massacre" which made millions for the mob", and that "Franzese's and Zimmerman's efforts to make a feature length musical and not a sex film or violence film is a big move for mobsters to get into the more respectable aspects of the movie business." The report also stated that "Zimmerman was convicted of perjury in an organized crime case in 1978 and is scheduled to be in court in Los Angeles tomorrow on grand theft charges", and that Michael Franzese was "arrested by the FBI on racketeering charges, one of fourteen people charged in an alleged Mafia loan sharking and strong-arm operation that invested mob money in legitimate businesses."
USA Today then wrote a letter to Franzese on July 2, 1984, stating that "we are no longer able to allow Miami Gold Promotions, Inc. to participate as a sponsor of the USA Today/Michael Jackson Victory Tour Contest." The letter went on to say
As you know, your participation was to be consistent with the ethics and ideals of USA TODAY.
Due to the recent unfavorable publicity concerning you and Miami Gold Productions, we are compelled to take this step ...