Trademark Trial and Appeal Board Electronic Filing System. http://estta.uspto.gov
`ESTTA140938
`ESTTA Tracking number:
`05/16/2007
`
`Filing date:
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`91160555
`Plaintiff
`Ambient Entertainment Inc.
`Ambient Entertainment Inc.
`1360 Skyline Blvd.
`Reno, NV 895093966
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`KENNETH A FEINSWOG
`ATTORNEY
`6100 CENTER DRIVE SUITE 630
`LOS ANGELES, CA 90045
`UNITED STATES
`kfeinswog@aol.com
`Other Motions/Papers
`Kenneth A. Feinswog
`kfeinswog@aol.com
`/kenneth a. feinswog/
`05/16/2007
`AMBIENTCASHCOMPLAINT.pdf ( 39 pages )(1159311 bytes )
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`Proceeding
`Party
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`Correspondence
`Address
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`Submission
`Filer's Name
`Filer's e-mail
`Signature
`Date
`Attachments
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`Cr: :. 3:O7—CV—OO1‘E8-HDM—RAFVl
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`Dt)=::Lm“i£—§ni: 1-1
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`Filed G3./'12/'2(}{)7’
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`Page 1 of 39:
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`._a MARK H. GUNDERSON LTD.
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`Mark H. Gunderson, Esq.
`2 Nevada State Bar No. 2134
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`3 U. Mehi Aholelei-Aonga, Esq.
`Nevada State Bar No. 9743
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`4 5345 Kietzke Lane, Suite 200
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`Reno, Nevada 89511
`5 Telephone:
`(775) 829-1222
`6 Facsimile:
`(775) 829-1226
`Attorneys for Plaintiff
`7 CASH PROCESSING SERVICES, LLC
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`8
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`IN THE UNITED STATES DISTRICT COURT
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`DISTRICT OF NEVADA
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`ll CASH PROCESSING SERVICES, LLC,
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`a Nevada limited liability company
`Plaintiff,
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`13
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`14
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`v.
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`AMBIENT ENTERTAINMENT, lNC.,
`15 a Nevada corporation
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`Case No. CV— N -
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`COMPLAINT FOR
`TRADEMARK INFRINGEMENT,
`UNFAIR COMPETITION AND
`CANCELLATION OF TRADEMARK
`REGISTRATION
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`Defendant,
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`/
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`Plaintiff, CASH PROCESSING SERVICES, LLC (“CPS”) as and for its Complaint against
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`20 Defendant AMBIENT ENTERTAINMENT, INC. (“Ambient”) alleges the following:
`21
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`JURISDICTION AND VENUE
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`22
`1.
`This
`is a trademark infringement action arising under
`15 U.S.C.
`23 Jurisdiction is proper under 15 U.S.C. § 1121, 28 U.S.C. §§ 1331, 1367 and 1338.
`24
`2.
`Venue is proper under 28 U.S.C. § 1391 in the District of Nevada because all of the
`25 parties are located in this District.
`26
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`§§ 1125.
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`//1’
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`//I
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`MARK H. GUNDERSON. LTD.
`A VROFESSIDNIL
`LAW CORPORATION
`SUITE 200
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`RENO, NEVADA 89511
`5345 KIETZKE LANE
`[175] 829-1222
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`1
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`

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`Cr: .. 3:O7—CV—OC}l ‘E8-HDM—RAF‘v’l
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`Docume:-mt 1-"?
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`Filed G3./'12/'2007’
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`Page 2 of 39:
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`3.
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`CPS is a Nevada limited liability company with a principal place of business in
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`THE PARTIES
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`3 Sparks, Nevada.
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`4
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`4.
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`Upon information and belief, Defendant has a principal place of business in Reno,
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`5 Nevada.
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`FACTS
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`History of the MUSTANG RANCH trademark
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`The MUSTANG RANCH trademark (“Mark”) along with the design of the Mark
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`A.
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`5.
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`(Exhibit A) have been used in Nevada for legal brothel services since at least 1971.
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`6.
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`Since at least 1971 to the present the MUSTANG RANCH trademark has become
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`famous throughout
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`12 Conforte.
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`the United States for use with prostitution services by Joseph and Sally
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`7.
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`Joseph and Sally Conforte owned and operated the brothel and sold various goods
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`with the Mark until approximately 1990, when they both filed bankruptcy proceedings and all of the
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`assets were disposed of by the Internal Revenue Service (“IRS”) through a public auction on or
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`about November of 1990.
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`8.
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`The highest bid at the IRS auction was Mustang Properties, Inc. who purchased the
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`property and assets of the Mustang Ranch. Mustang Properties, Inc. sold the business, property and
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`assets to AGE Corporation, Inc. and AGE Enterprises, Inc. who operated the Mustang Ranch
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`brothel and sold various goods using the Mark at least between 1990 and 1999.
`B.
`Forfeiture of Business, Assets and Mark
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`9.
`On or about November of 1995, a superceding indictment was filed against
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`23 Conforte, AGE Enterprises, Inc., AGE Corporation, Inc., and others for bankruptcy fraud, wire
`24 fraud, money laundering, and RICO violations among others.
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`10.
`A Preliminary Order of Forfeiture issued on July 12, 1999, granting the United
`:: States twenty million dollars, all the stock, interest in and assets, including accounts receivable and
`28 several parcels of real property owned by AGE Corporation, Inc. and AGE Enterprises, Inc.
`MARK H. GUNDERSON, LTD.
`A pnnrssstomu.
`uwconwonnmu
`SUITE 200
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`RENO, NEVADA 83511
`5145 KIETZKE LANE
`[775] 829-1222
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`(-2 3:O7’—ev—O0t 18-HDMRAM Document 1-1
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`Fiieri 03./12./'2007’
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`Page 3 0? 39:
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`11.
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`Any person with an interest in the property listed in the Preliminary Order of
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`Forfeiture had thirty days from the final publication of the notice to petition the Court for a hearing
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`to adjudicate the validity of the U.S. Government’s interest in the property.
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`12.
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`After disposition on all notices of interest in the AGE entities’ assets,
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`the U.S.
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`Government applied for a Final Order of Forfeiture to earn clear title to the property and warrant
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`good title to any subsequent purchaser or transferee.
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`13.
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`On March 9, 2001, the United States District Court, District of Nevada, issued a
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`Final Order of Forfeiture directing that, among other things, all stock,
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`interests in and assets,
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`including accounts receivable and certain real property of AGE. Corporation,
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`Inc. and AGE
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`Enterprises, Inc. be forfeited to the United States Government.
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`14.
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`The Final Order of Forfeiture was stayed pending an Appeal to the Ninth Circuit
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`Court of Appeals on March 8, 2001. The Ninth Circuit Court of Appeals affirmed the convictions
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`on June 29, 2001. Although the case was appealed to the U.S. Supreme Court, certiorari was
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`denied on April 29, 2002.
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`C.
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`15.
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`U.S. Government’s Ownership Of The Mark
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`The U.S. Government worked very quickly to begin disposing of the assets and on
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`December 14, 2002, held an auction to dispose of the personal property located at the Mustang
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`Ranch. Upon information and belief, among some of the items sold at the auction which contained
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`use of the Mark were the following: matches; menus; bar lights; clothing, including tank tops,
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`sweatshirts, jackets, sweatpants, sweat tops, t-shirts, and polo shirts; furniture; bottle openers;
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`collectibles; wine; glassware; signs; souvenirs; bumper stickers; postcards; cameras; business cards;
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`letterhead and envelopes.
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`16.
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`On or about September 24, 2003, the U.S Department of Interior (“D01”) received a
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`letter
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`from Attorney Mark Litwak asserting claims
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`to the Mark on behalf of Ambient
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`Entertainment, Inc.
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`III
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`MARK H. GUNDERSON, LTD.
`A PKOFEBBIOIML
`LAW GORFORAHON
`SUITE 200
`5345 KIETZKE LANE
`RENO. NEVADA 39511
`(775) 829-1222
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`

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`C :2. 3:O?’—cv—OC)t ‘E8-HDMRAM Document 1-1
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`Filed 03./'12./'20{)?
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`Page 4 of 39:
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`17.
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`The DOI readily responded to this claim on October 3, 2003, by advising Mr. Litwak
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`that the U.S. Government owned the rights to the Mark, that the rights were not abandoned and that
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`the U.S. Government would continue to defend its rights in the Mark.
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`18.
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`19.
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`DOI did not receive any response back from Mr. Litwak or his client.
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`On or about October 7, 2003, the Bureau of Land Management (“BLM”) and D01
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`placed the Mustang Ranch buildings, business and trademark up for auction on eBay.
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`20.
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`Bidding closed on the auction on October 13, 2003 and the building, business and
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`trademark were awarded to the highest bidder, who was initially identified as Lance Gilman. The
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`sale was then made directly with Cash Administrative Services, LLC (“CAS”) and a Bill of Sale
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`and Assignment were entered into on December 22, 2003 between CAS and the U.S. Government.
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`D.
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`Current Ownership of the Mark
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`21.
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`On December 31, 2004, CAS assigned the Mustang Ranch business associated with
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`the MUSTANG RANCH trademark, including the goodwill and the Mustang Ranch I buildings, to
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`a company called TG Investments.
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`22.
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`Shortly thereafter, on or about March 10, 2004, TG Investments assigned the
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`Mustang Ranch business associated with the MUSTANG RANCH trademark,
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`including the
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`goodwill and the Mustang Ranch I buildings to Cash Processing Services, LLC (“CPS”).
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`23.
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`CPS and its predecessors in interest have engaged in a long and difficult battle to
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`move the original Mustang Ranch buildings to their new location as required by the purchase
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`agreement and have expended a great deal of resources, experience, hard work, marketing and
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`commitment of capital to reopen the Mustang Ranch with the same look and feel as the original
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`Mustang Ranch as soon as practicable.
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`24.
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`CPS and its predecessors in interest defended against several frivolous claims by
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`third parties which prevented them from moving the original Mustang Ranch buildings and from
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`constructing the buildings on the new site. The court vacated all the injunctions and, as soon
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`thereafter as practicable, CPS resumed moving the original buildings from their original location.
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`/W
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`-I3
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`N000--JON
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`MARK H. GUNDERSON, LTD.
`A FHUFESSIDNN.
`LAW CORPORATION
`SUITE 200
`5345 KIETZKE LANE
`FIENO, NEVADA B9511
`may 529.1222
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`

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`C ~22. 3:0?’—ev—00t ‘E8-HDM—RAF\i1
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`Document 1-1
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`Filed 03./12./'2007’
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`25.
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`26.
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`At present, CPS has successfully moved the original building to the new site.
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`In December of 2003, David and Ingrid Burgess and Sherwin M. Fellen
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`(collectively, “Burgess”) filed an action in the United States District Court for the District of
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`Nevada against L. Lance Gilman, CPS and other related entities (the “Burgess action”), disputing
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`ownership of the Mark.
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`27.
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`After almost three (3) years, the Burgess action was finally tried in a bench trial
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`before the Honorable Edward C. Reed, Jr. commencing on December 12, 2006, lasting a total of
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`three (3) days, ending on December 14, 2006.
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`28.
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`On December 15, 2006, the Court announced its verdict, finding in favor of CPS and
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`against Burgess, concluding that CPS had the legitimate right to use the Mark and Burgess did not
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`have such a right.
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`In so finding, the Court dissolved a preliminary injunction that had previously
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`been granted in favor of Burgess and ordered that Burgess and their agents, representatives and the
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`like be enjoined a11d restrained from further use of the Mark.
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`29.
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`On February 22, 2007, the Court issued a written Order confirming its previous
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`Verdict, a copy of which is attached as Exhibit B.
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`E.
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`Unauthorized Use of the Mark by Ambient
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`30.
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`Ambient has filed at least six trademark applications with the United States Patent &
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`Trademark Office (USPTO) for the MUSTANG RANCH mark. Attached as included as part of
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`this Complaint as Exhibit B is a summary of the trademarks filed at the USPTO by Ambient.
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`31.
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`On December 16, 2003, Ambient received a federal trademark registration for use of
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`the Mark on condoms and clothing under Registration No. 2793458. This registration shows that
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`Ambient’s first use of the Mark on condoms and clothing was on June 27, 2002.
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`32.
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`On August 13, 2001, Ambient filed an Intent—to-Use trademark application with the
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`USPTO for use of the Mark on books and screenplays.
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`33.
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`On September 22, 2003 Ambient filed an Intent—to-Use trademark application with
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`the USPTO for use of the trademark MUSTANG BRIDGE RANCH on jewelry, leather products,
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`furniture and clothing.
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`MARK H. GUNDERSON, LTD.
`A pnorssauovm
`LAW CORPORATION
`SUITE 200
`5345 KIETZKE LANE
`RENO. NEVADA 68511
`[7775] 829-1222
`
`

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`Fiir-“sci 03./12./'2007’
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`Page 5 of 39:
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`34.
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`On September 24, 2003, Ambient filed an Intent-to-Use trademark application with
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`the USPTO to use the Mark on jewelry, leather products and furniture.
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`35.
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`On February 20, 2004, Ambient filed an Intent-to-Use trademark application with
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`the USPTO to use the Mark on non-alcoholic beverages, automobile accessories, games and
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`gaming machines, carpet cleaners and alcoholic beverages.
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`36.
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`On May 12, 2004, Ambient filed an Intent-to-Use trademark application with the
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`USPTO to use the Mark on paper goods.
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`37.
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`Since at least 1971, a great amount of time, effort and money was expended in
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`connection with the promotion and advertisement of the goods and services associated with the
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`Mark such that the Mark and its goodwill have become an asset of substantial value.
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`38.
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`Subsequent to the first use of the Mark and prior to the acts of Ambient complained
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`of herein, the Mark has continuously and extensively been used to advertise and/or sell its goods
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`and services to residents in various states and foreign countries, including clothing and many of the
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`other goods which Ambient has filed with the USPTO to use in conjunction with the Mark.
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`39.
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`Notwithstanding CPS’ and its predecessors in interest’s famous and prior common
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`law and statutory rights in the Mark, Ambient with at
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`least constructive notice of the prior
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`ownership rights of United States Government in the Mark, intentionally and willfully adopted and
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`used the Mark and/or the related design as its trademark for use with all of the goods and services
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`listed in Exhibit B.
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`40.
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`Prior to the infringing use of the Mark by Ambient the Mark became recognized
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`world-wide and very famous. The Mark thus represents good will belonging to CPS.
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`41.
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`Subsequent to Ambient's knowledge of the U.S. Government’s rights in and to the
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`Mark and despite Ambient’s actual knowledge of its infringement, it has refused to cease and desist
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`from infringing upon CPS’ Mark.
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`42.
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`Ambient’s unauthorized,
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`intentional and willful use of CPS’ Mark creates a
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`likelihood of confusion, mistake and deception as to the affiliation, connection, association, origin,
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`28
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`MARK H. GUNDER$DN, LTD.
`A PROFESEIONAL
`LAW CDRPORNIIDN
`SUITE 200
`5345 KIETZKE LANE
`RENO. NEVADA 83511
`(W6) B29-1222
`
`

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`Cr: :. 3:O7’—ov—OC)t ‘E8-HDMRAM Document 1-1
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`Filed ()3./'12./'200?
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`Page 7' of 39:
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`._.
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`sponsorship or approval of the goods and services of CPS with those of Ambient, all to CPS’
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`irreparable loss and damage.
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`43.
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`Upon information and belief, actual confusion of consumers has occurred or will
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`likely occur and will continue to occur as a result of the acts of Ambient complained of herein,
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`unless Ambient is enjoined from continuing said acts. Furthermore, CPS will suffer irreparable
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`injury to its reputation and goodwill unless Ambient is so enjoined.
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`CLAIM I
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`Federal Claim for Dilution under Section 43(c)§ 11
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`44.
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`CPS repeats, realleges and reiterates each and every paragraph set forth above as if
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`fully set forth herein.
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`45.
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`By the acts complained of herein, Ambient has willfully caused dilution of CPS’
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`famous Mark and continues to do so.
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`46.
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`Ambient has lessened the capacity of CPS’ famous mark to identify and distinguish
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`the services of CPS from those of Ambient. Ambient has blurred the unique association which has
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`heretofore existed between CPS Mark and the goods and services offered by that Mark.
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`47.
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`CPS’ Mark is a distinctive and famous mark. The Mark has long been used in
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`connection with the goods and services on which it appears, has long been the subject of advertising
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`and promotion,
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`is widely recognized by consumers throughout
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`the United States and is in
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`substantially exclusive use. The acts of Ambient occurred after the Mark became famous.
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`48.
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`Ambient committed these acts willfully and with the intent to trade on the reputation
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`of CPS and trade on the goodwill associated with the Mark and cause dilution of the famous Mark.
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`49.
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`CPS has been damaged as a result of Ambient’s conduct in an amount according to
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`proof.
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`CLAIM II
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`Common Law- Trademark Infringement
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`50.
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`CPS repeats, realleges and reiterates each and every paragraph set forth above as if
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`fully set forth herein.
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`MARK H. GUNDERSON. LTD.
`A PMDPESIIDNM.
`LAWGDRPDRATION
`SUITE 200
`534-5 KIETZKE LANE
`RENO. NEVADA 83611
`(175)325-1222
`
`

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`51.
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`By the acts complained of herein, Ambient has used a reproduction, counterfeit,
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`copy or colorable imitation of CPS’ Mark in connection with the sale, offering for sale, distribution
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`and advertising of its goods and services, and such use is likely to cause confusion, mistake and
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`deception among the consuming public.
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`52.
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`CPS has been damaged by Ambient’s willful infringement in an amount according to
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`proof.
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`53.
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`CPS is entitled to an award of its reasonable attorney’s fees and costs of suit as a
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`result of Ambient’s willful infringement.
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`CLAIM III
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`Lanham Act Violation - Unfair Comgetition
`15 U.S.C. § 1125(a)
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`S4.
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`CPS repeats, realleges and reiterates each and every paragraph set forth above as if
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`fully set forth herein.
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`55.
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`Ambient’s' use of its infringing mark constitutes a false designation of origin,
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`description or representation, which is likely to cause confusion, mistake or to deceive as to origin,
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`affiliation, connection, sponsorship or association of Ambient with CPS, or as to the origin,
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`sponsorship or approval of Ambient’s use of the Mark by CPS, in Violation of 15 U.S.C. § ll25(a).
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`56.
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`Ambient acted knowingly, willfully, and maliciously with the intent to injure CPS by
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`engaging in the conduct herein described. Ambient acted to defraud and oppress CPS through its
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`intentional and willful use of CPS’ Mark.
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`57.
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`Said actions of Ambient demonstrate conduct evidencing a willful and conscious
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`disregard of the rights of CPS, thereby justifying an award of punitive damages in the amount to be
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`proven at trial.
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`Common Law Unfair Competition
`CPS repeats, realleges and reiterates each and every paragraph set forth above as if
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`58.
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`CLAIM IV
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`fully set forth herein.
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`MARK H. GUNDERSON, LTD.
`A PROFESSIONAL
`LAW CORPOIAYIDII
`SUITE 200
`5345 KIETZKE LANE
`RENO. NEVADA B9511
`|'i'75) B29-1222
`
`

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`(Ice 3:O7’—cv—OC)t ‘E8-t-EDM—RAF\i1
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`Page ‘E3 of 39:
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`59.
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`Ambient’s use of its infringing mark constitutes a false designation of origin,
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`description or representation, which is likely to cause confusion, mistake or to deceive as to origin,
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`affiliation, connection, sponsorship or association of Ambient’s goods and services with those of
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`CPS, or as to the origin, sponsorship or approval of a third party's use of the Mark by CPS which
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`constitutes unfair competition in violation of Nevada common law.
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`60.
`
`Ambient acted knowingly, willfully, and maliciously with the intent to injure CPS by
`
`engaging in the conduct herein described. Ambient acted to defraud and oppress CPS through its
`
`intentional and willful use of CPS’ Mark.
`
`61.
`
`Said actions of Ambient demonstrate conduct evidencing a willful and conscious
`
`disregard of the rights of CPS, thereby justifying an award of punitive damages in the amount to be
`
`proven at trial.
`
`Cancellation under Lanham Act Section 2je[
`CPS repeats, realleges and reiterates each and every paragraph set forth above as if
`
`62.
`
`CLAIM V
`
`
`
`©O0--.}O\-DUJBJ
`
`10
`
`ll
`
`12
`
`13
`
`14
`
`15
`
`fully set forth herein.
`
`16
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`17
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`18
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`19
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`20
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`21
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`22
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`23
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`24
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`25
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`26
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`27
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`28
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`63.
`
`At the very least, Ambient fraudulently represented to the United States Patent &
`
`Trademark Office that it was the owner of the Mark and entitled to use the Mark in commerce.
`
`64.
`
`65.
`
`CPS is damaged by registration of the Mark because it rightfully belongs to CPS.
`
`CPS is entitled to cancellation of the applications/registrations made by Ambient and
`
`injunctive relief as against Ambient.
`
`66.
`
`CPS repeats, realleges and reiterates each and every paragraph set forth above as if
`
`CLAIM VI
`
`Common Law Dilution
`
`fully set forth herein.
`
`67.
`
`CPS’ Mark is a distinctive and famous mark._ The Mark has long been used in
`
`connection with the goods and services on which it appears, has long been the subject of advertising
`
`and promotion,
`
`is widely recognized by consumers throughout
`
`the United States and is in
`
`substantially exclusive use. The acts of Ambient occurred after the Mark became famous.
`
`MARK H. GUNDERSDN, LTD.
`A PRDFEEBIDNAL
`LAW CORPORATION
`SUITE 200
`5345 KIETZKE LANE
`RENO, NEVADA 85511
`(775) 828-1222
`
`

`
`Ga 8 3:t)7—CV—Q0"i ‘l8—HDi\Il—RAi\/l
`
`Document l~"E
`
`Filed 03/'12./'2007
`
`Page "30 of 3S
`
`y—n
`
`K006‘-~.'lO\U1-i-‘-LaJI\J
`
`i—I C3
`
`._a
`
`p—A
`
`n—- i\.)
`
`—A U)
`
`n—- -P-
`
`68.
`
`Ambient committed these acts willfully and with the intent to trade on the reputation
`
`of CPS and trade on and goodwill associated with the Mark and to cause dilution of the famous
`
`Mark.
`
`69.
`
`CPS has been damaged as a result of Ambient’s willful conduct in an amount
`
`according to proof.
`
`70.
`
`Ambient acted to defraud and oppress CPS through its intentional and willful use of
`
`CPS’ Mark. Said actions evidencing a willful and conscious disregard of the rights of CPS, thereby
`
`justifying an award of punitive damages under Nev. Rev. Stat. § NRS 600.430 in the amount to be
`
`proven at trial.
`
`Deceptive Trade Practice Violation
`CPS repeats, realleges and reiterates each and every paragraph set forth above as if
`
`71.
`
`CLAIM VII
`
`fully set forth herein.
`
`72.
`
`Ambient's use of its infringing mark constitutes a false designation of origin,
`
`._.A UN
`
`description or representation, which is likely to cause confusion, mistake or to deceive as to origin,
`
`»-—-A O\
`
`>—A --J
`
`..._. 00
`
`n--- \O
`
`affiliation, connection, sponsorship or association of Ambient with CPS, or as to the origin,
`
`sponsorship or approval of Ambient's use of the Mark by CPS, in violation of Nev. Rev, Statute
`
`§s9s.
`
`73.
`
`Ambient acted knowingly, willfully, and maliciously with the intent to injure CPS by
`
`l\-3 G engaging in the conduct herein described. Ambient acted to defraud and oppress CPS through its
`
`I0 i—-
`
`intentional and willful use of CPS’ Mark, and by inducing others to infringe on CPS’ Mark. Said
`
`Ix)IQ actions demonstrate conduct evidencing a willful and conscious disregard of the rights of CPS,
`
`[M3 L»)
`
`I\.)A
`
`I\) ‘U1
`
`[0 ON
`
`IN) ---~.]
`
`28
`
`MARK H. GUNDERSON, LTD.
`APROFE5$|0NulL
`LAWCORFDRATJDJI
`sum; zoo
`
`RENO, NEVADA 39511
`5345 KIETZKE LANE
`(775) 329.1222
`
`thereby justifying an award of punitive damages in the amount to be proven at trial.
`
`74.
`
`CPS is entitled to injunctive relief and restitution according to proof.
`
`PRAYER FOR RELIEF
`
`CPS demands the following relief:
`
`1.
`
`CPS be awarded its damages and Ambient’s profits attributable to Ambient’s
`
`1 0
`
`

`
`Ca
`
`3 3:{)7’—ev~Q0"H8—HDM—RAM
`
`Document t~"E
`
`Fiied 03,/12./‘EGO?
`
`Page "31 of 353
`
`infringement of the Mark under common law, for Unfair Competition under the Federal Lanham
`
`Act and common law and for Dilution under common law and the Federal Lanham Act;
`
`2.
`
`CPS be awarded three times the profits attributable to Ambient’s infringement and
`
`Unfair Competition under 15 U.S.C. § 1117 and Nev. Rev. Statute §§598 and 600.435-450;
`
`3.
`
`CPS be awarded its reasonable attorney's fees and costs of suit, under 15 U.S.C. §
`
`1117 and Nev. Rev. Statute §§598 and 600.435-450;
`
`4.
`
`An accounting be undertaken to determine the amount of a constructive trust to be
`
`established for the benefit of CPS, reflecting the value of Ambient's unjust enrichment gained
`
`through its acts complained of herein;
`
`5.
`
`An injunction be issued pursuant to 15 U.S.C. § § 1114 and 1116 and Nev. Rev.
`
`Statute §§598 and 600.435-450 against Ambient and its servants, agents, employees, successors and
`
`assigns, and all persons acting in concert or privity with them, enjoining each of them, singly and
`
`collectively, from
`
`(a) any further infringing or contributory infringing use of the Mark, or any mark
`
`confusingly similar thereto,
`
`(b) further holding itself or inducing others to hold themselves out to the public as
`
`being affiliated with or sponsored by CPS in any manner, or committing any acts likely to imply
`
`any such relationship or affiliation, and
`
`(c) unfairly competing with CPS.
`
`6.
`
`An order requiring Ambient to file with this Court and serve on CPS within thirty
`
`days after the service of an injunction, a report in writing under oath, setting forth in detail the
`
`manner and form in which Ambient has complied with the injunction.
`
`7.
`
`An order requiring Ambient
`
`to deliver to CPS for destruction all material
`
`in
`
`Ambient's possession or control bearing Ambient's infringing marks or any other designation
`
`confusingly similar thereto under 15 U.S.C. § 11 18.
`
`IN
`
`1 2 3 4 \
`
`D0O'--]O\
`
`10
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`11
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`12
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`13
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`14
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`15
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`16
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`17
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`18
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`20
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`21
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`22
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`23
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`24
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`25
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`26
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`27
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`28
`
`MARK H. GUNDERSDN, LTD.
`A PRDFEIBIDNM.
`LAW CDRPONATIDH
`SUITE 200
`5345 KIETZKE LANE
`RENO. NEVADA B951
`[775] 829-1222
`
`1
`
`11
`
`

`
`Gae 3:{)7’—ov—Q{3"i t8—HDM—RAM
`
`Document t~‘E
`
`Fiied O3,/12./‘EGO?
`
`Page 12 of 333
`
`1
`
`8.
`
`An order preventing Ambient's unfair competition and awarding damages necessary
`
`2 to restore to CPS any money or property which Ambient has acquired by means of its unfair
`
`3
`
`4
`
`5
`
`'5
`
`7
`
`competition;
`
`9.
`
`10.
`
`11.
`
`12.
`
`8 and
`
`Compensatory damages in an amount to be proven at trial;
`
`Punitive damages in an amount to be proven at trial;
`
`An order awarding CPS prejudgment interest on any monetary award;
`
`An order that Ambient’s applications and registrations for the Mark be cancelled,
`
`13.
`
`Such other and further relief as this Court deems just and proper.
`
`DATED this
`
`i 2-
`
`day of March, 2007.
`
`MARK H. GUNDERSON, LTD.
`
`
`
`.
`
`U. Mehi Ahole1ei~Aonga, Esq.
`Nevada State Bar No. 9743
`
`Attorneys for Plaintiff
`Cash Processing Services, LLC
`
`9
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`10
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`1 1
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`12
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`13
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`14
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`15
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`26
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`27
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`28
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`W*:.°.:::2:::.:=~-
`
`.,.Z'%.i~ZEE°.§§{l"..
`
`RENO, NEVADA 811511
`(T161825-1222
`
`.2
`
`

`
`
`
`(323558 3:O7—CV~Q{3"i ‘i8—HDM—RAi\/E
`
`Dacument 1~"E
`
`Fiieéd €33/'12./ECEO7
`
`Page "33 03“ 3Q
`
`EXHIBIT A
`
`

`
`

`
`
`
`(323558 3:O7—CV~Q{3"i ‘i8—HDM—RAi\/E
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`Dacument 1~"E
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`Fiieéd €33/'12./ECEO7
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`Page "35 03“ 3Q
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`EXHIBIT B
`
`EXHIBIT B
`
`

`
`
`
`‘Case 3:O?—ev~{3{3‘i 18—HDM—RAi\/E
`
`Document 1~"E
`
`Fiied O3/'12./EGG?
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`Page 16 of 333
`Page1of
`22
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`C fse 3:03-cv-00707-ECR-RAM -Document 292
`
`FiIed0 22/ 007
`
`
`
`UNITED STATES DISTRICT COURT
`DISTRICT OF NEVADA
`RENO, NEVEDB
`
`3:03-CV-O707—ECR—RAM
`
`QQQE3
`
`)} ) ) ) ) J ) J } ) ) 3
`
`))
`
`DAVID and INGRID BURGESS,
`husband and wife; and SHERWIN
`M. FELLEN, an individual;
`
`Plaintiffs,
`
`VS.
`
`L. LANCE GILMAN; CASH
`ADMINISTRATION SERVICES, LLC;
`CASH MANAGEMENT SERVICES, LLC;
`CASH PROCESSING SERVICES; and
`CASH ASSET MANAGEMENT, LLC:
`
`Defendants.
`
`
`This case involves the disputed ownership of the Mustang
`
`Ranch's service marks after the government seized that brothel in
`
`conjunction with criminal proceedings against the former owner.
`
`We
`
`now enter a written version of the order we issued from the bench
`
`on December 15, 2006 (# 271). Changes from the decision on the
`
`record have been limited to very minor formatting and grammatical
`
`edits necessary to render a written decision.
`
`These changes in no
`
`way effect the substance of any part of the decision.
`
`ir
`
`in
`
`‘k
`
`This is the time set for the Court to announce its decision in
`this case.
`
`
`
`

`
`
`‘.
`
`‘Case 3:0?—cv~00‘i 18—HDM—RAi\/E
`
`Document 1~"E
`
`Fiied O3/'12./'2€307
`
`Page "37 of I30
`
`C se 3:03-cv-00707-ECR-RAM Document 292
`
`Filed 0212212007
`
`Page 2 of 22
`
`-4
`
`Plaintiffs David and Ingrid Burgess and Sherwin M. Fellen
`
`filed their Complaint
`
`(#2)
`
`on December 23,
`
`2003, and a Second
`
`Amended Complaint
`
`(#42) on April 26, 2004, seeking a declaratory
`
`judgment that Mr. Fellen was the owner of the Mustang Ranch service
`
`mark, and that the Burgesses had the exclusive right to use that
`mark in conjunction with prostitution.
`
`Defendants L. Lance Gilman: Cash Administration Services, LLC;
`
`and Cash Management Services, LLC, answered (#26)
`
`the Second
`
`Amended Complaint
`
`(#42) on February 20, 2004. Defendant Cash
`
`Processing Services (“CPS”) answered and filed a counterclaim for
`
`infringement and unfair competition under the Lanham Act on May 20,
`2004.
`
`Plaintiffs filed a Third Amended Complaint
`
`(#114), on January
`
`28, 2005, and Cash Processing Services again answered and counter~
`
`The parties have stipulated
`claimed (#121) on February 18, 2005.
`that Mr. Fellen, subject to certain conditions stated in the
`
`stipulation,
`
`is dismissed from the action.
`
`Cash Processing Services filed a motion for a preliminary
`
`injunction cn July 14, 2004.
`
`(#54.)
`
`Judge Hagen denied
`
`Defendants’ motion on September 27, 2004.
`
`(#82.) Plaintiff then
`
`filed motions for a temporary restraining order and a preliminary
`
`injunction on December 21, 2004 (##94, 95), and CPS renewed its
`
`motion for a preliminary injunction shortly thereafter on December
`
`27,
`
`2004.
`
`(# 98.)
`
`On December 30, 2004, Judge Hagen granted
`
`Plaintiffs’ motion for a preliminary injunction and denied
`
`Defendants’
`
`renewed motion.
`
`(#101.) Defendants filed a motion for
`
`
`
`

`
`
`j-—.
`
`‘Case 3:O?—ev~00‘i 18—HDM—RAi\/E
`
`Document (HE
`
`Page 18 of 333
`
`1
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`C se 3:O3—cv-00707~ECR-RAM Docurnent292
`
`Filed 0212212007
`
`Page 3 of 22
`
`-2
`
`reconsideration on January 18, 2005 (#109), which Judge Hagen
`
`denied on January 25, 2005 (#113).
`
`Defendants filed a Notice of Appeal of these decisions on
`
`February 2, 2005 (#115), and the Ninth Circuit affirmed in a
`
`memorandum decision on June 17, 2005.
`
`Burgess V, Gilman,
`
`134 Fed.
`
`Appx. 200 (9th Cir. 2005).
`
`It is likely that this appeal explains
`
`why this case has been pending so long.
`
`It sounds like this case
`
`has been here over three.years, and it has, but a considerable
`
`portion of that time can be explained by the appeal.
`
`The Plaintiff, on the one hand, and Cash Asset Management and
`CPS on the other, filed motions, being oross—motions for summary
`judgment.
`(###149, 150, 151.) We denied all of these motions on
`
`February 23, 2006.
`
`(#198.)
`
`Defendants then filed a motion to dissolve the preliminary
`
`the
`On November 13, 2006,
`(#222.)
`injunction, on July 20, 2006.
`parties stipulated to resolve this motion at the same time that
`the
`
`merits were resolved.
`
`They also agreed that all claims for damages
`
`leaving the remaining claims for declaratory
`were to be dismissed,
`relief,
`injunctive relief, and attorneys fees and costs.
`
`(##258,
`
`259.)
`
`A bench trial was held before this Court on December 12
`
`through 14, 2006.
`
`I -
`
`§e£:e.sE11_t__I_n_.:|'11n_ et1'_on
`
`A party seeking a permanent injunction in these circumstances
`
`must meet a four—factor test, demonstrating:
`
`(1)
`
`that it has suffered an irreparable injury:
`
`3
`
`

`
`
`..
`Fiied2./'2€3C37
`Page "39: of 3Q
`
`'Gase 3:O?—cv~{3{3‘i 18—HDM—RAi\/E
`
`Document 1~"E
`
`C se 3:03-cv-00707-ECR-RAM Document 292
`
`Filed 02/22/2007
`
`Page 4 of 22
`
`(2)
`
`that remedies available at
`
`law, such as monetary damages,
`
`are inadequate to compensate for that injury:
`
`(3)
`
`that, considering the balance of hardships between the
`
`plaintiff and defendant, a remedy in equity is warranted; and
`
`(4)
`
`that the public interest would not be disserved by a
`
`permanent injunction.
`
`eBay Igg. V, Mggcflxghange, L.L.C., 126 S. Ct. 1837, 1839 (2006).
`
`“[O]nce the plaintiff establishes a likelihood of confusion, it is
`
`ordinarily presumed that the plaintiff will suffer irreparable harm
`
`if injunctive relief is not granted.”
`
`Vision Sprots,
`
`Inc. v.
`
`1
`
`2
`
`3
`
`4
`U1
`
`6 7
`
`3 9
`
`H Melville QOEELI
`
`888 F.2d 609, 612 n.3 (9th Cir. 1989).
`
`12
`
`The evidence is virtually undisputed that there will be
`
`13 confusion if both parties seek to use the mark at issue in this
`
`14 case. There was evidence presented at the trial that there has
`
`15 been actual confusion between Plaintiffs’ and Defendants’
`
`I6 operations respecting emergency calls to the County,
`
`that
`
`17
`
`independent contractors have been confused, and that cab drivers
`
`18 bringing customers to the establishments have been confused.
`
`As Judge Hagen stated previously in this case: “It almost goes
`19
`20 without saying that two brothel operations in the immediate
`
`21 vicinity of each other using the same name will result in confusion
`
`I i
`
`for customers and others.”
`
`22
`
`23
`
`24
`
`II.
`
`f rs
`
`f
`
`a Mark
`
`Where a business as a whole is transferred without mentioning
`25
`the transfer of the mark, it is presumed that the mark and good
`26
`27 will associated with that mark are transferred as well. American
`28
`
`4
`
`

`
`
`
`-Case 3‘O?—C\I—Q0118—tiDM—RAM
`
`Document 1~‘E
`
`‘F33:-:—§d O3/'12./'2007
`
`Page 2C} 03“ 3Q
`
`C Se 3:03-CV-00707-ECR-RAM Document 292
`
`Filed 02/22/2007
`
`Page 5 of 22
`
`1 Dirigold Corp, V, Dirigold Metals Corp., 125 F.2d 446, 453 (6th
`
`'\DOO--JONUI-vF>UJh.)
`
`Cir. 1942); J. Thomas McCarthy, 2 Mggarthy on Trademarks and Unfair
`
`Qgmpetitign