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DEAL, LLC v. KORANGY PUBLISHING

January 20, 2004.

THE DEAL, LLC, Plaintiff, -against- KORANGY PUBLISHING, INC., Defendant


The opinion of the court was delivered by: SHIRA SCHEINDLIN, District Judge

OPINION AND ORDER

The Deal, LLC ("The Deal") brings this action alleging unfair competition and infringement of its registered trademarks, THE DAILY DEAL and THE DEAL (collectively THE DEAL MARKS) through Korangy Publishing, Inc.'s ("Korangy Publishing") publication of The Real Deal.*fn1 The Deal now moves to preliminarily enjoin Korangy Publishing's use of the phrase "The Real Deal" or any other reproduction or colorable imitation of THE DEAL MARKS in connection with print or online publications. The Deal also seeks to recall informational, promotional, and other materials bearing the words `The Real Deal." For the reasons set forth below, plaintiff's motion is denied in its entirety.

 1. BACKGROUND

  A. Procedural Background

  On October 14, 2003, The Deal filed a Complaint alleging trademark infringement Page 2 and unfair competition under the Lanham Act. One month later, The Deal moved for a preliminary injunction.*fn2 The motion was fully briefed on January 5, 2004, and an evidentiary hearing was held on January 9 and January 12, 2004.*fn3

  B. The Parties

  The Deal is a national, "diversified media company" established in March 2000 to provide "financial news, commentary, data, and services to corporate and financial dealmakers, their advisors and investors worldwide"*fn4 through print and on-line media, e.g., The Deal (a newsweekly), The Daily Deal (a daily financial newspaper), and TheDeal.com (containing information taken from The Deal's print publications).*fn5 Korangy Publishing is a publishing company established in April 2003. Its principal business is the publication of a monthly magazine, The Real Deal, which contains information about the New York City real estate market and is available on newsstands and by subscription.*fn6 Korangy Publishing also maintains an Internet site containing information drawn from The Real Deal.*fn7 Page 3

  C. The Dispute

  The Deal has several trademarks, including THE DAILY DEAL and THE DEAL, which it alleges Korangy Publishing infringed by its publication of The Real Deal.*fn8 The Deal registered the trademarks THE DAILY DEAL and THE DEAL on January 23, 2001 and May 13, 2003, respectively.*fn9

  The Deal uses these trademarks in connection with its two primary publications — The Deal and The Daily Deal. The Deal is a tabloid-size glossy, color magazine with the word "Deal" in bright red lettering. Spanning the cover of each edition is a single image, such as a color photograph or illustration relating to the lead story.*fn10 The cover page of The Daily Deal is primarily black and white, featuring numerous text stories and small black-and-white photographs on the front cover.*fn11 The Deal primarily circulates its publications through Page 4 subscriptions and online sales, rather than newsstands.*fn12 The Deal has approximately 40,000 subscribers and The Daily Deal has approximately 5,000 subscribers.*fn13 The so-called "Deal Community" of consumers includes corporate executives, deal advisors (e.g., bankers, corporate lawyers, mortgage brokers), and institutional investors.*fn14 The Deal alleges that its publications "regularly contain articles concerning the real estate market."*fn15

  The Deal claims that on December 16, 2002, Korangy Publishing's principal and publisher, Amir Korangy, visited The Deal's New York City headquarters and spoke with Richard Siler, an advertising salesperson with The Deal.*fn16 The parties characterize Korangy's conduct differently. According to The Deal, Korangy posed as a potential advertiser — an agent from The Corcoran Group — to hoodwink Siler, thereby obtaining valuable marketing information about The Deal.*fn17 Korangy, by contrast, asserts that he was simply trying to "see Page 5 how other trade magazines promote[] advertising for placement within their publications and to ensure that The Deal did not have a real estate angle and would be an inappropriate forum for Real Estate Advertisers."*fn18 Neither party denies that Korangy was given a media kit containing "Various information on The Deal's publications, including samples of the publications themselves, advertising rates, and other pertinent information."*fn19 When Siler contacted Korangy two weeks later, Korangy allegedly informed him that he had opted to advertise in smaller real estate publications.*fn20

  In April 2003, Korangy Publishing began to distribute a monthly magazine entitled The Real Deal. The Real Deal is a tabloid-size glossy, color magazine. The word "Real" in the title appears in italics and the words "New York Real Estate" appear in red lettering below the title. The cover page depicts a combination of text stories and photographs.*fn21 The Real Deal is sold on newsstands and includes among its primary audience "brokers, attorneys, agents, developers, accountants, financiers and real estate executives."*fn22 Page 6

  The Deal's employees first became aware of The Real Deal in July 2003.*fn23 The Deal then sent three letters to Korangy Publishing asking it to "reconsider" its use of allegedly similar marks. Because Korangy Publishing declined to stop using that name, The Deal commenced the instant action in October.*fn24 The Deal contends that Korangy Publishing misappropriated elements of THE DEAL MARKS and that the "overall presentation of Korangy's The Real Deal' mark and the masthead for its publication incorporates elements long used by The Deal, including prominent use of a particular shade of red in its publications and website content."*fn25 The Deal also submits that the topics addressed in The Real Deal are "substantially similar" to those topics covered in The Daily Deal and The Deal.*fn26 Finally, The Deal alleges that the publications share the same readership.*fn27

 II. ANALYSIS

  A. Legal Standard

  A preliminary injunction is "one of the most drastic tools in the arsenal of judicial Page 7 remedies"*fn28 and should not be routinely granted.*fn29 To obtain a preliminary injunction, a party must demonstrate (1) probability of irreparable harm in the absence of injunctive relief and (2) either a likelihood of success on the merits of the claim, or a "serious question going to the merits and a balance of hardships tipping decidedly in [plaintiff's] favor."*fn30

  "In an action for trademark infringement, where a mark merits protection, a showing that a significant number of consumers are likely to be confused about the source of the goods identified by the allegedly infringing mark is generally sufficient to demonstrate both irreparable harm and a likelihood of success on the merits."*fn31 Thus, in deciding whether to issue a preliminary injunction in a trademark infringement action, the central questions before the court are (1) whether the plaintiff has a valid mark entitled to protection and (2) whether the defendant's alleged infringement is likely to cause confusion among consumers.*fn32

  B. Delay

  As an initial matter, any "presumption of irreparable harm is inoperative if the plaintiff has delayed either in bringing suit or in moving for preliminary injunctive relief."*fn33 Page 8 "Though such delay may not warrant the denial of ultimate relief, it may, standing alone, . . . preclude the granting of preliminary injunctive relief, because the failure to act sooner undercuts the sense of urgency that ordinarily ...


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