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Erickson Beamon Ltd. v. CMG Worldwide, Inc.

United States District Court, Second Circuit

September 25, 2013

ERICKSON BEAMON LTD., Plaintiff,
v.
CMG WORLDWIDE, INC., and THE ESTATE OF BETTE DAVIS, Defendants.

MEMORANDUM AND ORDER

NAOMI REICE BUCHWALD, District Judge.

Plaintiff Erickson Beamon Ltd. ("plaintiff") brings this action for a declaratory judgment of trademark non-infringement, non-violation of section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and non-infringement of certain rights of publicity with respect to its jewelry line called "The Bette Davis Eyes" collection. Defendants CMG Worldwide, Inc. ("CMG") and the Estate of late movie star Bette Davis (the "Estate") (collectively, "defendants") have asserted that plaintiff's jewelry line violates those intellectual property rights. Presently before the Court are two motions: defendants' motion to dismiss the action or, in the alternative, to stay or transfer it to the Southern District of Indiana, and plaintiff's cross-motion to enjoin the prosecution of the Indiana action.

For the reasons set forth below, we deny defendants' motion to dismiss or transfer the action. We further deny plaintiff's cross-motion to enjoin the prosecution of the Indiana action.

BACKGROUND[1]

Plaintiff is a New York corporation that designs and distributes jewelry for sale in 75 nations worldwide. (Compl. ¶¶ 1, 16); www.ericksonbeamon.com (last visited Aug. 8, 2013). One defendant is the Estate, which is co-executed by Michael Merrill, an individual residing in Massachusetts. (Id. ¶ 3.) CMG, the other defendant, is the exclusive licensing agent for the Estate as to Bette Davis's intellectual property, is an Indiana corporation with its principal places of business in Indianapolis and Los Angeles, California. (Id. ¶ 2; see Def. Mem. at 5.)

In or about late 2010, plaintiff launched a jewelry line called the "Bette Davis Eyes" collection. (Compl. ¶ 17.) Specifically, plaintiff has used that name in the advertisement, marketing, and distribution of various jewelry items, including, but not limited to, the "Erickson Beamon Bette Davis Necklace, " the "Erickson Beamon Bette Davis Ring, " the "Erickson Beamon green Bette Davis Eyes Ring, " the "Erickson Beamon Bette Davis Eyes Earrings, " and the "Erickson Beamon Bette Davis Eyes Bracelet, " (see Def. Mem. at 5-6.), which were distributed for sale at retailers throughout the United States. (Herr Decl. ¶ 4.) While defendants do not submit that plaintiff's jewelry items depict any image or likeness of the actress Bette Davis (see Minch Decl. Exs. 1-8), it is undisputed that plaintiff selected and used the "Bette Davis Eyes" name without prior express authorization from the Estate. (Id. ¶ 21; Herr Decl. ¶ 4.)

In September 2011, upon learning about plaintiff's jewelry line, CMG, acting on behalf of the Estate, sent correspondence to plaintiff advising that it believed the use of Bette Davis's name was unauthorized and, as such, constituted an infringement of the Estate's rights in and to her name, likeness, and image. (Def. Mem. at 2; Herr Decl. ¶ 4.) Nearly ten months of consistent settlement negotiations ensued thereafter between CMG and plaintiff's outside litigation counsel. (Herr Decl. ¶ 4.) Defendants concede that throughout these negotiations, CMG did not threaten litigation "but instead made clear to counsel for Erickson Beamon that CMG and its client, the Estate of Bette Davis, preferred to work out the issue of Erickson Beamon's unauthorized use of the name, image, and/or likeness of Bette Davis in an amicable fashion." (Id.; see also id. Ex. A, at 2.) Nevertheless, no such settlement was reached. (Id.)

On June 29, 2012, plaintiff filed the instant lawsuit seeking declaratory relief. (Compl. ¶¶ 31-49.) Specifically, plaintiff's complaint for declaratory relief asserts that its collection was named for the song "Bette Davis Eyes, " recorded by pop singer Kim Carnes in 1981, and has never used Bette Davis's likeness or in any other way affiliated itself with the late actress. (Id. ¶¶ 7-8, 17.) It further maintains that consumers of its jewelry are unaware of the actress Bette Davis, despite the popularity of Ms. Carnes' recording. (Id. ¶ 19.) Essentially, plaintiff's complaint alleges that, but for the popularity of Ms. Carnes' recording of "Bette Davis Eyes, " consumers of plaintiff's jewelry would be completely unfamiliar with the name Bette Davis. (Compl. ¶ 18.) Plaintiff therefore vehemently denies any usurpation of Bette Davis's name, likeness, or rights of publicity.

On July 2, 2012, and defendants allege without prior notice, plaintiff's counsel notified counsel for CMG that it had filed an action for declaratory relief in this Court. (Id.; see dkt. no. 1.)

On November 16, 2012, CMG filed a lawsuit in the Southern District of Indiana. See Compl., CMG Worldwide, Inc. and The Estate of Bette Davis v. Erickson Beamon Ltd. et al., No. 1:12cv-1687 (JMS) (S.D. Ind. Nov. 16, 2012) (dkt. no. 1.)

On December 17, 2012, defendants filed the instant motion to dismiss or, in the alternative, to stay or to transfer this action to the U.S. District Court for the Southern District of Indiana. (Dkt. no. 33.) On January 18, 2013, plaintiff filed a one-page motion, with no supporting memorandum of law, to enjoin defendants from prosecuting the Indiana action. (Dkt. no. 28.) Four days later, plaintiff opposed defendants' motion to dismiss. (Dkt. no. 29.) Defendants filed their reply on February 9, 2013. (Dkt. no. 38.)

DISCUSSION

I. Defendants' Motion to Dismiss or Stay the New York Action Pending Resolution of the Indiana Action

A. Legal Standards

Plaintiff brings her action under the Declaratory Judgment Act, 28 U.S.C. § 2201(a). Primarily defendants argue that plaintiff's claims are improperly brought under that provision because they "were brought in anticipation of the coercive suit for the purposes of gaining home field advantage." (Def. Mem. at 8.)

Where two courts have concurrent jurisdiction over an action involving the same parties and issues, courts will follow a "first-filed" rule whereby the court which first has possession of the action decides it." Schnabel v. Ramsey Quantitative Sys., Inc. , 322 F.Supp.2d 505, 509-510 (S.D.N.Y. 2004); see also D.H. Blair & Co., Inc. v. Gottdiener , 462 F.3d 95, 106 (2d Cir. 2006) ("[W]here there are two competing lawsuits, the first suit should have priority, absent the showing of balance of convenience or special circumstances giving priority to the second.") (quoting First City Nat'l Bank & Trust v. Simmons , 878 F.2d 76, 79 (2d Cir. 1989); Buddy USA, Inc. v. Recording Indus. Ass'n of Am., Inc. , 21 Fed.App'x 52, 55, 2001 WL 1220548, at *2 (2d Cir. 2001). Moreover, "The ...


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