United States District Court, S.D. New York
BENIHANA OF TOKYO, LLC, as successor to BENIHANA OF TOKYO, INC., Plaintiff and Counter Defendant,
BENIHANA, INC., as successor to BENIHANA NATIONAL CORP. and NOODLE TIME, Inc., Defendants and Counter Claimants,
KEIKO AOKI, Counter Defendant.
OPINION & ORDER
A. ENGELMAYER, District Judge.
decision resolves a motion to dismiss counterclaims by
Benihana, Inc. ("BI") and Noodle Time, Inc. against
Benihana of Tokyo, LLC ("BOT") and Keiko Aoki,
BOT's chief executive officer. BOT originally brought
this action, but, after BOT's voluntary dismissal of its
claims and the Court's ruling that certain of BI's
counterclaims were required to be resolved in arbitration,
the only remaining claims are those brought by BI and Noodle
Times in their Third Amended Counterclaims
("TACC"). Those claims are under the Lanham Act,
for trademark infringement, false designation of origin and
unfair competition, and trademark dilution. BOT now moves to
dismiss these claims.
reasons that follow, the Court denies the motion to dismiss.
Court assumes familiarity with the background and procedural
history of this case, including the decision in Benihana
of Tokyo, LLC v. Benihana, Inc., 73 F.Supp.3d 238
(S.D.N.Y. 2014), which dismissed some of BI's
counterclaims in favor of arbitration. The Court also assumes
familiarity with the long and tangled history of legal
disputes between these parties in this Court, including
Benihana of Tokyo, LLC v. Angelo, Gordon & Co.,
L.P., No. 16 Civ. 3800 (PAE), 2017 WL 933111 (S.D.N.Y.
Mar. 8, 2017), in Benihana, Inc. v. Benihana of Tokyo,
LLC, No. 15 Civ. 7248 (PAE), 2016 WL 3913599 (S.D.N.Y.
July 15, 2016), and Benihana, Inc. v. Benihana of Tokyo,
LLC, 784 F.3d 887 (2d Cir. 2015). The following is a
brief summary of the claims in this case, drawing upon the
BI alleges that, under the
March 17, 1995 Amended and Restated Plan of Reorganization
(“ARA”) between BI and BOT, it owns rights to the
various Benihana trademarks and service marks (the
“Trademarks”) in the United States, Central
America, South America, and the Caribbean (the
“Territory, ” as referred to in the ARA), while
BOT owns the trademarks and service marks outside of the
Territory. TACC ¶ 9; see also Id. ¶ 10
(list of Benihana trademarks owned by BI). In the ARA, BI and
BOT agreed that neither would use the Trademarks in such a
way that could reasonably be expected to reduce the value or
the usefulness of the Trademarks to either party.
Id. ¶ 12; see also TACC, Ex. A
(“ARA”), § 7.10. Overall, the ARA gives BI
the right to operate Benihana restaurants in the United
States, save in Hawaii, where BOT has a contractual license
from BI to do so. Currently, BI owns 66 Benihana restaurants
and franchises 11 others within the Territory. For its part,
BOT owns or franchises 19 Benihana restaurants outside the
Territory, plus the Hawaii restaurant, located in Honolulu.
Id. ¶ 13.
summary, BI alleges that BOT and Aoki have violated BI's
trademark rights as secured by the Lanham Act, through (1)
statements, images, and other content on BOT's website,
(2) statements in various press releases, and (3) statements
by Keiko Aoki.
example, as alleged, on or about September 4, 2012, BOT
established a website with the domain name
www.benihanaworld.com “to advertise and promote
BOT's business as the ‘world-wide'
leader.” Id. ¶ 14. This domain name, BI
alleges, is accessible in the United States and
“perpetuates the false impression stated on BOT's
original (and also still active) website
(benihana-of-tokyo.com/eatertainment.php) that it is BOT that
‘has more than 100 locations worldwide, in more than 20
countries, '” and wrongly suggests that “BOT
owns or operates Benihana restaurants throughout the world
and/or has the right to use the BENIHANA® Trademarks
throughout the world.” Id. ¶¶ 14-15.
The website initially featured a rotating globe featuring
various famous global landmarks, including the Statue of
Liberty. This, BI alleges, gave website visitors “the
misleading impression that BOT owns or operates Benihana
restaurants” in the United States generally and in New
York. Id. ¶¶ 17-18. In fact, BI notes, it
has the exclusive rights to operate Benihana restaurants in
the Territory and to use the Benihana Trademarks there.
Id. After BI brought its counterclaims, the Statue
of Liberty was removed from BOT's rotating globe.
Id. ¶ 18.
alleges that other statements on the same website misstated
BOT's geographic rights to operate Benihana restaurants.
For example, it alleges that “BOT inaccurately
identifies the areas controlled by BOT” so as to state
that BOT ‘now control[s] the territories of Hawaii,
Canada, Mexico, Europe, the Middle East, Australia, Asia, and
Africa, '” id. ¶ 19 (modifications in
original), and that “BOT ‘operates privately with
franchisees all around the world that emulate and carry out
the vision of Rocky Aoki, '” id. ¶
21. In fact, BI alleges, “BOT does not have the right
to operate Benihana restaurants ‘all around the
world.'” Id. BI further alleges that
statements on BOT's website “make it unclear that
BOT's rights are separate and distinct from those of BI,
which has exclusive ownership of the BENIHANA® Trademarks
in the Territory and the exclusive right to operate Benihana
restaurants within the Territory.” Id. ¶
23. BOT's website further states that it is
“‘the originator of the unique hibachi cooking
style and ‘eatertainment' created in the United
States, '” which, BI alleges, gives the
“false impression that BOT owns and operates Benihana
restaurants within the United States where the brand was
first launched in 1964, has some sort of partnership with BI
in operating such restaurants, or that BI operates as a BOT
franchisee or licensee.” Id. ¶ 24. This,
BI alleges, “causes customer confusion and damages the
Benihana brand and image within the Territory.”
alleges violations in connection with BOT's opening of a
restaurant “named KOA (presumably using [counter
defendant] Keiko Ono Aoki's initials), ” in
connection with which BOT issued a press release, held
special events, and made statements on its website.
Id. ¶ 27. As alleged, BOT's press release
confused customers by conflating its rights to the Benihana
brand with BI's rights. For example, the press release
referenced a “‘Benihana restaurant chain'
with ‘over 100 locations in 15 countries' that is
now in its ‘50th year'” so as to imply that
that chain was “BOT, the entity purportedly opening
KOA.” Id. BI also alleges that, in celebrating
the 50th anniversary of the Benihana restaurants, BOT
assembled “a Japanese hip-hop dance duo dubbed the
‘Beni-Girls'” and promoted itself with the
statement that “both hip-hop dance and Benihana were
created in New York.” Id. ¶ 28. The
intended effect of this, BI alleges, was to “create
confusion and the knowingly false impression that BOT is in
fact the entity operating the Benihana restaurants located in
New York, and that BOT owns the goodwill and history of
‘the Benihana restaurant chain, ' which according
to the BOT/KOA press release, has ‘over 100 locations
in 15 countries.'” Id. BI also alleges
that BOT and Aoki created a website called “Keiko Aoki
Inner Makeup, ” which purported to offer sushi catering
services in New York City, “featuring a ‘live
performance' by a ‘veteran sushi chef' fully
clad in a Benihana uniform, bearing the BENIHANA®
logo.” Id. ¶ 30 & Ex. H.
Court describes here only background relevant to BI's
January 13, 2014, BOT filed the original complaint in this
action. Dkt. 1. On March 20, 2014, BI filed an answer with a
broad set of counterclaims against BOT. Dkt. 7. On May 2,
2014, BOT filed a motion to voluntarily dismiss its
complaint, Dkt. 24, and a motion to dismiss BI's
counterclaims, or, in the alternative, to stay this action
and compel arbitration of BI's counterclaims, Dkt. 28. On
July 22, 2014, the Court issued a decision in which it denied
BOT's motion to dismiss, but granted its motion to compel
arbitration of certain of BI's counterclaims and denied
its motion to compel arbitration of others. Dkt. 42. As to
the claims that the Court did not order be resolved in
arbitration, on July 31, 2014, BI filed amended
counterclaims. Dkt. 43. Later, on November 3, 2014, the Court
granted leave for BI to file Second Amended Counterclaims,
Dkt. 58, Ex. A. Dkt. 60. On February 18, 2015, the Court
stayed discovery in this case pending the arbitration. Dkt.
September 1, 2016, the Court granted BI leave to file the
TACC. Dkt. 86. On September 30, 2016, BI filed the TACC. Dkt.
87. On October 14, 2016, BOT filed a motion to dismiss and,
in support, a memorandum of law (“BOT Br.”) and
the Declaration of Joseph L. Manson III, attaching the ARA
and License Agreement at issue in these cases. Dkts.
89-91.On October 28, 2016, BI filed a memorandum
of law in opposition, Dkt. 92; on November 4, 2016, BOT filed
a reply memorandum of law, Dkt. 94. On December 16, 2016, BOT
asked the Court to stay discovery pending resolution of its
motion to dismiss the TACC, Dkt. 97; on December 22, 2016, BI
filed a letter in opposition, Dkt. 99. On January 18, 2017,
the Court ...