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Mrs. United States v. Miss United States of America Organization

July 13, 2012

MRS. UNITED STATES NATIONAL PAGEANT, INC., PLAINTIFF,
v.
MISS UNITED STATES OF AMERICA ORGANIZATION, LLC, STEVEN GAMBRELL, TAMMY JOHNS, DEFENDANTS.



The opinion of the court was delivered by: David G. Larimer United States District Judge

DECISION AND ORDER

The maxim that "imitation is the sincerest form of flattery" may well be true, but in matters of intellectual property, efforts at imitation are not always taken as a compliment, as they often lead to a violation of property rights. The case now before the Court provides an example of just such a situation.

This is a trademark dispute. Plaintiff, Mrs. United States National Pageant, Inc., is a New York corporation based in Fairport, New York, that operates beauty pageants throughout the country. Plaintiff currently owns eight federally registered trademarks, including "Mrs. United States," and seven other variants, all of which utilize the terms "United States" and the prefixes "Mrs.," "Miss," or "Ms." Amended Complaint ("AC") (Dkt. #14) ¶ 11.

Plaintiff has sued three defendants--Miss United States of America Organization, LLC, Steven Gambrell, and Tammy Johns--alleging that defendants have infringed upon plaintiff's trademarks, by means of defendants' commercial use of the term "Miss United States of America," and several variations and permutations of that name (such as "Mrs. United States of America" and "Miss Teen United States of America"). In essence, defendants' challenged marks simply add the tag-on phrase "of America" after the term "United States." For example, one of plaintiff's protected marks is "Miss United States." Defendants use that exact phrase but append "of America" to it in their mark, "Miss United States of America." Defendants assert that this seemingly minor alteration amounts to a distinction that makes a genuine difference between the parties' marks.

Plaintiff alleges that defendants have announced and advertised their plans to conduct a pageant in Atlanta, Georgia in late July 2012, for the title of "Miss United States of America." Plaintiff also alleges that defendants have created a website to promote that pageant, www.missunitedstatesofamerica.com. Based on those allegations, plaintiff asserts claims under the Lanham Act, 15 U.S.C. §§ 1114, 1125, as well as a number of claims under New York law.

Plaintiff has filed a motion to preliminarily enjoin defendants from using the allegedly infringing marks and internet domain name. Defendants have filed a motion to dismiss the complaint for lack of personal jurisdiction and improper venue. Plaintiff has also filed a motion to either deny defendants' motion to dismiss, or in the alternative to allow plaintiff to conduct jurisdictional discovery.

BACKGROUND

According to the complaint, plaintiff's president, Isabella Ilacqua, has been involved in the beauty pageant business since 1985. Under Ilacqua's direction, plaintiff has conducted the Mrs. United States pageant annually for the past twenty-five years. AC ¶ 12. Plaintiff also owns and operates an internet site to advertise its pageants, using the domain name www.mrsunitedstates.com. AC ¶ 14.

Defendant Johns was a contestant in, and ultimately the winner of plaintiff's 2009 Mrs. United States pageant. In 2011, at that year's Mrs. United States pageant in Las Vegas, Nevada, Johns allegedly approached Ilacqua and asked her whether she would consider selling some of plaintiff's trademarks to Johns. Ilacqua replied that she was not interested in any deal along those lines. Later that month, Johns and defendant Gambrell, a former state director for plaintiff, repeated Johns's offer in writing, and Ilacqua again refused. AC ¶¶ 21-23.

In September 2011, Johns and Gambrell formed the defendant entity, Miss United States of America, LLC, in South Carolina, which is also where Johns and Gambrell reside. Johns is the president, and Gambrell is the Chief Executive Officer of that entity. AC ¶¶ 9, 10. They also registered a website, under the domain name www.missunitedstatesofamerica.com.

The following month, defendants filed applications for the trademarks "Miss United States of America" and "Mrs. United States of America." AC ¶¶ 33, 34. Defendants have stated on their website that the Miss United States of America pageant, which will include contestants from all fifty states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands, will be held on July 22-28, 2012, in Atlanta. AC ¶¶ 34, 35.

Plaintiff commenced this action on March 16, 2012, and filed an amended complaint on April 25. Plaintiff asserts claims for trademark infringement, unfair competition under New York law, breach of contract, and "cybersquatting," as explained in more detail below. Plaintiff seeks injunctive relief, and in the alternative, damages. Plaintiff's motion for a preliminary injunction seeks an order restraining defendants from using their various "United States of America" marks, and from using the domain name "missunitedstates.com."

In their motion to dismiss, defendants contend that this Court lacks personal jurisdiction over them. They state that they have never transacted business in New York, that they have no office or residence in this state, and they have not consented to jurisdiction here. Defendants further contend that there is no evidence that the website has been purposefully aimed at New York residents.

DISCUSSION

I. Personal Jurisdiction

As in any action, the Court cannot reach the merits of the plaintiff's claims until it is satisfied that it has jurisdiction over both the subject matter and the defendants themselves. See, e.g., In re Rationis Enters., Inc. of Panama, 261 F.3d 264, 267--68 (2d Cir.2001) (treating personal jurisdiction as a threshold determination that precedes adjudication of the merits). At this early stage of the case, however, "plaintiffs need only make a prima facie showing of personal jurisdiction over the defendants," and the Court "construe[s] the pleadings and affidavits in the light most favorable to plaintiffs, resolving all doubts in their favor." Porina v. Marward Shipping Co., 521 F.3d 122, 126 (2d Cir. 2008). "[P]laintiff[s'] prima facie showing ... must include an averment of facts that, if credited by [the ultimate trier of fact], would suffice to establish jurisdiction over the defendant." Metropolitan Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 567 (2d Cir. 1996) (second alteration in original). See also Citigroup Inc. v. City Holding Co., 97 F.Supp.2d 549, 563 (S.D.N.Y. 2000) ("Citigroup's burden at this stage of the proceedings is to establish a prima facie case for jurisdiction over City Holding").

In general, a "district court's personal jurisdiction is determined by the law of the state in which the court is located." Spiegel v. Schulmann, 604 F.3d 72, 76 (2d Cir. 2010). This Court therefore looks to New York law in determining whether personal jurisdiction may be had in New York over the defendants, although there is also a federal constitutional component to this analysis, as explained below.

To determine personal jurisdiction over a non-domiciliary in a case involving a federal question, the court engages in a two-step analysis. See Best Van Lines, Inc. v. Walker, 490 F.3d 239, 243-44 (2d Cir. 2007). First, the court applies the forum state's long-arm statute. See id. at 244; Sunward Elecs., Inc. v. McDonald, 362 F.3d 17, 22 (2d Cir. 2004).

If the long-arm statute permits personal jurisdiction, the second step is to analyze whether personal jurisdiction comports with the Due Process Clause of the United States Constitution. This second analysis has two related components: the "minimum contacts" inquiry and the "reasonableness" inquiry. With respect to minimum contacts, the court must determine whether the defendants have sufficient contacts with the forum state to justify the court's exercise of personal jurisdiction. See International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945).

For purposes of this inquiry, courts distinguish between "specific" and "general" jurisdiction. "Specific jurisdiction exists when 'a State exercises personal jurisdiction over a defendant in a suit arising out of or related to the defendant's contacts with the forum.'" Chloe v. Queen Bee of Beverly Hills, LLC, 616 F.3d 158, 164 (2d Cir. 2010)(quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 & n.8 (1984)). "A court's general jurisdiction, on the other hand, is based on the defendant's general business contacts with the forum state, and permits a court to exercise its power in a case where the subject matter of the suit is unrelated to those contacts." Id. (citing Helicopteros Nacionales, 466 U.S. at 414-15 n. 9).

The "reasonableness" inquiry requires the Court to decide "whether the assertion of personal jurisdiction comports with 'traditional notions of fair play and substantial justice'--that is, whether it is reasonable to exercise personal jurisdiction under the circumstances of the particular case." Licci v. Lebanese Canadian Bank, SAL, 673 F.3d 50, 60 (2d Cir.) (quoting Chloe, 616 F.3d at 164), certified question accepted, 18 N.Y.3d 952 (2012).*fn1 In determining the reasonableness of a particular exercise of jurisdiction, a court must consider: (1) the burden on the defendant, (2) the interests of the forum State; (3) the plaintiff's interest in obtaining relief; (4) the interstate judicial system's interest in obtaining the most efficient resolution of controversies; and (5) the shared interest of the several States in furthering fundamental substantive social policies. Chloe, 616 F.3d at 173 (citing Asahi Metal Industry Co., Ltd. v. Superior Court of California, Solano County, 480 U.S. 102, 113 (1987)).

The New York long-arm statute does not extend in all respects to the constitutional limits established by International Shoe and its progeny. See, e.g., Best Van Lines, 490 F.3d at 244-45 & n. 8 (noting "gaps" between the jurisdiction conferred by the New York long-arm statute and that permissible under the federal Due Process Clause); Banco Ambrosiano, S.P.A. v. Artoc Bank & Trust Ltd., 62 N.Y.2d 65, 71 (1984) ("in setting forth certain categories of bases for long-arm jurisdiction, [the New York long-arm statute] does not go as far as is constitutionally permissible"). "Where ... the plaintiffs premise their theory of personal jurisdiction upon the New York long-arm statute, [the court should therefore] first consider whether the requirements of the statute have been satisfied before proceeding to address whether the exercise of jurisdiction would comport with the Due Process Clause." Licci, 673 F.3d at 61.

II. Application to this Case

In the case at bar, I conclude that plaintiff has made a sufficient showing of personal jurisdiction over defendants, both under New York's long-arm statute and as a constitutional matter. The record before me indicates that defendants have deliberately reached into New York, primarily through the operation of their website, and that defendants' allegedly tortious acts caused an injury to plaintiff within this state.

The New York long-arm statute states, in part, that a New York "court may exercise personal jurisdiction over any non-domiciliary ... who in person or through an agent ... commits a tortious act without the state causing injury to person or property within the state," provided that the defendant "expects or should reasonably expect the act to have consequences in the state and derives substantial revenue from interstate or international commerce." C.P.L.R. § 302(a)(3).

While this test has long been established, its application to cases involving the operation of a website is still evolving. The basic governing principles are no different in internet cases, however; "traditional statutory and constitutional principles remain the touchstone of the inquiry," and the analysis that has been developed simply "applies traditional principles to new situations." Best Van Lines, Inc. v. Walker, 490 F.3d 239, 252 (2d Cir. 2007) (citing Zippo Mfg. Co. v. Zippo Dot Com, Inc., 952 F.Supp. 1119 (W.D.Pa. 1997)) (additional internal quotation marks omitted).

In internet cases, the analytical framework that has evolved employs a sliding scale, based on the degree to which the defendant has used the internet in its commercial or other relevant activities. At one end of that scale is the creation or maintenance of a purely "passive" website, which "does little more than make information available to those who are interested in it" or the information that it contains. At the opposite end of the spectrum are defendants who enter into contracts, or otherwise interact with residents of other jurisdictions, that "involve ...


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