Proceeding
`Party
`
`Correspondence
`Address
`
`Submission
`Filer's Name
`Filer's e-mail
`
`Signature
`Date
`Attachments
`
`Trademark Trial and Appeal Board Electronic Filing System. http://estta.uspto.gov
`ESTTA371634
`ESTTA Tracking number:
`10/04/2010
`
`Filing date:
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`91179064
`Defendant
`Disney Enterprises, Inc.
`Mark E. Miller
`O'Melveny & Myers LLP
`Two Embarcadero Center, 28th Floor
`San Francisco, CA 94111
`UNITED STATES
`markmiller@omm.com
`Other Motions/Papers
`Mark E. Miller
`markmiller@omm.com, smalek@omm.com, aechery@omm.com,
`dpetrocelli@omm.com
`/Mark E. Miller/
`10/04/2010
`Disney Reply Brief In Support of Motion to Dismiss.PDF ( 11 pages )(215041
`bytes )
`Exhibit A to Disney Reply Brief in Support of Motion to Dismiss.PDF ( 55 pages
`)(2970362 bytes )
`Exhibit B to Disney Reply Brief in Support of Motion to Dismiss.PDF ( 28 pages
`)(1522511 bytes )
`Exhibit C to Disney Reply Brief in Support of Motion to Dismiss.PDF ( 35 pages
`)(2294425 bytes )
`Exhibit D to Disney Reply Brief in Support of Motion to Dismiss.PDF ( 31 pages
`)(2057231 bytes )
`Exhibit E to Disney Reply Brief in Support of Motion to Dismiss.PDF ( 13 pages
`)(663525 bytes )
`Exhibit F to Disney Reply Brief in Support of Motion to Dismiss.PDF ( 21 pages
`)(1468743 bytes )
`Exhibit G to Disney Reply Brief in Support of Motion to Dismiss.PDF ( 5 pages
`)(116489 bytes )
`Exhibit H to Disney Reply Brief in Support of Motion to Dismiss.PDF ( 3 pages
`)(27278 bytes )
`Exhibit I to Disney Reply Brief in Support of Motion to Dismiss.PDF ( 19 pages
`)(533435 bytes )
`
`

`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`STEPHEN SLESINGER, INC.,
`
`Opposer,
`
`V~
`
`Opposition No.
`
`DISNEY ENTERPRISES, INC.,
`
`Applicant.
`
`91179064
`91182358
`91183644
`91186026
`
`91187261
`
`91188860
`
`91191230
`
`91192691
`
`91194551
`
`91196019
`
`Cancellation No.
`
`92046853
`
`REPLY BRIEF IN SUPPORT OF MOTION TO DISMISS
`
`I.
`
`INTRODUCTION
`
`The district court actually and necessarily decided that SSI’s grant of rights to Disney
`
`was an assignment, and that Disney was (and is) entitled to register Winnie the Pooh-related
`
`trademarks. SSI’s continued insistence to the contrary is disingenuous.
`
`In fact, SSI directly injected those issues into the district court proceeding by (a) alleging
`
`in its counterclaims that Disney was a mere licensee and (b) seeking a declaration from the
`
`district court “ordering the United States Patent and Trademark Office to correct the title of any
`
`[Disney-owned] trademark registrations to Slesinger.” (Exh. A (Fourth Amended Answer and
`
`Counterclaim) fil 137.) The parties explicitly and extensively briefed the issue of ownership in
`
`their summary judgment papers—-—~Disney arguing that SSI’s grant was an assignment, entitling
`
`Disney to register trademarks in its own name, and SSI vigorously opposing, arguing it was a
`
`license. The district court had no choice but to confront the issue, and found that “under the
`
`

`
`clear terms of the parties’ agreements, SSI transferred all of its rights in the Pooh works to
`
`Disney, and may not now claim infringement of any retained rights.” (Exh. E (Order Granting
`
`Mot. for Summary Judgment) at 8:6—8.) SSI opted not to appeal the district court’s ruling.
`
`The district court’s ruling on this essential point was explicitly recognized by the
`
`Honorable Fern M. Smith (Ret.), serving as a Special Master in the district court proceeding.
`
`Judge Smith confirmed that the district court’s dismissal of the trademark claim was “because
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`Slesinger did not own any of the rights at
`
`issue.”
`
`(Exh. F (Special Master’s Report &
`
`Recommendation) at 19:19—~22 (emphasis added).).
`
`Because the district court actually and necessarily determined that SSI assigned to Disney
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`all of its ownership interests in the Winnie the Pooh trademarks, SSI is collaterally estopped
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`from challenging the district court’s ruling in this or any other forum, and the consolidated
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`proceedings should therefore be dismissed.
`
`SSI’s distorted retelling of documented events
`
`cannot be given credence.
`
`II.
`
`THE DOCTRINE OF COLLATERAL ESTOPPEL PRECLUDES SSI FROM
`
`RELITIGATING THE ISSUE OF OWNERSHIP OF THE POOH MARKS.
`
`The doctrine of collateral estoppel was developed to prevent parties from litigating issues
`
`“over and over again.” Mother is Restaurant, Inc. v. Mama '5 Pizza, 1110., 723 F.2d 1566, 1569
`
`(Fed. Cir. 1983). The doctrine is vital on many levels to a functioning judicial system.
`
`It
`
`“relieve[s]
`
`the parties of the cost and vexation of multiple lawsuits, conserve[s] judicial
`
`resources, and, by preventing inconsistent decisions, encourage[s] reliance on adjudication.”
`
`Allen v. McCurry, 449 US. 90, 94 (1980).
`
`Collateral estoppel is no less important before this Board.
`
`It is well—settled that the
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`TTAB must give a court’s determination of an issue preclusive effect where:
`
`(a) there is an
`
`identity of issues; (b) the issue was “raised, litigated and actually adjudged” in the prior action;
`
`Atty. Docket No.: 903423-300
`
`2
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`

`
`(c) the determination of the issue was “necessary and essentia ” to the prior judgment; and (d) the
`
`party against whom estoppel is being asserted was fully represented in the prior action. Larami
`
`Corp. v. Talk To Me Programs, Inc., 36 U.S.P.Q.2d 1840 (Trademark Trial & App. Bd. Mar. 14,
`
`1995).
`
`SSI does not dispute that it was firlly represented in the prior action.
`
`Indeed, the record
`
`reflects that multiple, sophisticated law firms appeared on its behalf in the district court
`
`proceeding. Nor does SS1 dispute that the same issues presented now—whether SSI’s grant of
`
`rights to Disney was an assignment or license, and whether Disney had a right to register the
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`Pooh-related trademarks in its own name——were also raised and litigated in the district court
`
`case.
`
`Instead, SSI argues in its opposition brief that these issues were not actually or necessarily
`
`decided by the district court. But even a cursory review of the record, including SSI’s own
`
`pleadings and papers, reveals this position to be utterly meritless.
`
`A.
`
`The District Court Actually Ruled That SSI’s Grant to Disney Was An
`Assignment.
`
`As Judge Smith recognized, the district court’s ruling is directly at odds with SSI’s
`
`continued assertion of rights. Beyond the ruling itself, however, the facts and circumstances
`
`leading up the district court’s dismissal of SSI’s claims indisputably confirm that the court
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`recognized and ruled that SSI’s grant of rights to Disney was an assignment.
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`As an initial matter, in the district court action SS1 claimed that Disney infringed its
`
`trademark rights by exceeding the scope of the grant in the 1983 Agreement between the parties.
`
`(Exh. A 111] 126-136.) In order to assess that claim, the district court had to evaluate the granting
`
`instrument. Disney asserted in its successful summary judgment motion that
`
`the 1983
`
`Agreement was a complete assignment of rights, and therefore Disney could not have exceeded
`
`the scope of its grant.
`
`(Exh. B (Motion for Summary Judgment) at 2-9; Exh. D (Reply in
`
`Atty. Docket No.: 903423800
`
`3
`
`

`
`Support of Motion for Summary Judgment) at 2-16.) SSI argued the 1983 Agreement was a
`
`license.
`
`(Exh. C (Opposition to Motion for Summary Judgment) at 4-16.) This alone put the
`
`nature and scope of SSI’s grant to Disney squarely at issue. See KP Permanent Make- Up, Inc. v.
`
`Lasting Impression 1, Inc., 408 F.3d 596, 602 (9th Cir. 2005) (“Before infringement can be
`
`shown, the trademark holder must demonstrate that it owns a Valid mark, and thus a protectable
`
`interest.”).
`
`But SSI went much further. SS1 explicitly put the question of assignment-Versus-license
`
`before the court by alleging: “As a licensee of certain of Slesinger’s Trademark Rights, Disney’s
`
`use of these rights inures to the benefit of Slesinger. Accordingly, any registrations improperly
`
`obtained by Disney regarding the Slesinger Trademark Rights belong to Slesinger.” (Exh. A
`
`1ll37.) Based on these allegations, SSI sought affirmative relief from the district court:
`
`“Slesinger therefore seeks a declaration from this Court ordering the United States Patent and
`
`Trademark Office to correct the title of any such trademark registrations to Slesinger.
`
`[1]]
`
`WHEREFORE, Slesinger prays for relief as set further herein.” (Id.) Both the allegations and
`
`request for relief constitute a second and independent trademark infringement claim theory
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`whose outcome was expressly dependent on the court determining whether the 1983 Agreement
`
`was an assignment or license.
`
`Hence,
`
`the parties directly addressed the assigmnent—Versus—license question in their
`
`summary judgment briefs.
`
`In a section titled “The 1983 Agreement Was an Assignment, Not
`
`a License,” Disney argued in its moving papers that the plain language of the agreement makes
`
`its nature clear: “SSI’s characterization of the l983 Agreement as a license is directly refuted by
`
`paragraphs 7 and 8 [of the 1983 Agreement], which ‘assign’ all the Pooh Rights to Disney.”
`
`(Exh. B at 5222-621.)
`
`In both paragraph 7 and paragraph 8, the l983 Agreement states that SS1
`
`Atty. Docket No.: 903423-300
`
`4
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`

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`“assigns, grants, and sets over” its rights to Disney, and never once mentions the work “license.”
`
`(Exh.
`
`I (1983 Agreement between SSI and Disney) W 7-8.) Disney further reasoned that “the
`
`1983 Agreement manifests an assignment by every criterion that courts employ to distinguish
`
`assignments and licenses,” and followed with a bullet list demonstrating how each criterion
`
`points towards the grant being an assignment.
`
`(Exh. B at 6:6—27.) Disney also observed that
`
`“the 1983 Agreement contains none of the provisions traditional to the trademark license SSI
`
`claims the parties intended”—provisions like quality control, definition of retained rights, and
`
`prohibition of the grantee assigning its rights.
`
`(Id. at 7: 1-13 (emphasis in original).)l
`
`In opposing summary judgment, SSI did not argue that the district court need not address
`
`the question of assignment—versus—license, as it now claims.
`
`Instead, in sections titled “DISNEY
`
`CANNOT REGISTER TRADEMARKS” and “The Evidentiary Record Establishes Disney
`
`Received Only A License, Not An Assignment,” SSI devoted five complete pages to defending
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`both the position that Disney is merely a “licensee,” and its request that the court instruct the
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`United States Patent and Trademark Office (“PTO”) to change the owner of record of all Disney-
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`filed trademarks to SSI.
`
`(Exh. C at l1:21—16:6.) SSI presented its own interpretation of the
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`1983 Agreement and based on that interpretation and the course of conduct between the parties,
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`argued that the 1983 Agreement is best construed as a license. (Id.)
`
`In a section titled “THE 1983 AGREEMENT WAS AN ASSIGNMENT, NOT A
`
`LICENSE,” Disney responded to each of SSI’s arguments about the language of the 1983
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`Agreement and course of conduct between the parties.
`
`(Exh. D at l2:16~16:2.) For example,
`
`SSI claimed that the 1983 Agreement cannot be an assignment because it does not spell out that
`
`1 Disney also reiterated elsewhere in its papers that the 1983 Agreement was an assignment.
`(See, e.g., Exh. B at 2:20, 2:17-19 (“SSI has no ownership interest in the Pooh Rights”; “By the
`plain language of the parties’ agreements, SSI ‘assigns’ to Disney ownership of all of SSI’s
`intellectual property rights to the Winnie the Pooh works and characters.”).)
`
`Atty. Docket No.: 903423-300
`
`5
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`

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`Disney has the right to register trademarks in its own name.
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`(Exh. C at 12:21~22.) However, as
`
`Disney explained, “the right to register trademarks transfers automatically with the intellectual
`
`property interests from which it arises, and does not need to be expressly identified.
`
`ICEE
`
`Distribs. v. J&J Snack Foods Corp., 325 F.3d 586, 593 (5th Cir. 2003) (“explaining that
`
`trademark assignee ‘steps into the shoes of the assignor’ and ‘acquires .
`
`.
`
`. all the rights and
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`priorities of the assignor.’).” (Exh. D at 13:25~14:1 (emphasis in original).) SS1 now asks this
`
`Board to consider the same false position by arguing in its opposition brief, “On their face,
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`neither [the 1961 Agreement nor the 1983 Agreement] assigns Opposer’s trademark ownership
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`rights to Applicant.” (SSl’s Opp. to Mot. to Dismiss at 13.)
`
`Disney also highlighted the importance of SSl’s longstanding silence, a point that was
`
`emphasized in the district court’s ruling on ownership:
`
`SS1’s failure to object to Disney’s long history of registration of trademarks in its
`
`own name underscores that SS1 knew exactly what it had done in 1983: assign all
`
`of its rights to Disney. Between 1983 and 2006, when SS1 first asserted an
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`ownership interest, Disney registered 15 trademarks relating to the Pooh works in
`
`the United States alone. Under the Lanham Act, this provided SS1 “constructive
`
`notice of [Disney’s] claim of ownership.
`
`15 U.S.C. § 1072; see also Dep’t of
`
`Parks and Rec. for State of Cal. v. Bazaar Del Mundo Inc., 448 F.3d 1118, 1131
`
`(9th Cir. 2006).
`
`.
`
`.
`
`.
`
`It is telling that the first time SS1 objected to any of Disney’s
`
`trademark registrations was one month after the dismissal of its state court case.
`
`(Exh. D at 15:18~l6:2 (citations omitted).)
`
`In concluding that SS1 had assigned all of its rights,
`
`the district court reviewed the
`
`language of the key agreements, repeatedly quoting and paraphrasing the pivotal “assigns, grants
`
`Atty. Docket No.: 903423—300
`
`6
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`

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`and sets over” passage.
`
`(Exh. E at 4:5——5:12.) The court noted that “nowhere in its motion
`
`papers does SS1 identify precisely what rights it believes it retained. Nor can any such rights be
`
`discovered by reading the contracts.” (Id. at 6:26—7:2.) Then, picking up on Disney’s argument
`
`regarding course of conduct, the court ruled:
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`Although SS1 now claims copyright and trademark rights in the works, no
`
`evidence has been offered that SS1 ever attempted to perfect or register any such
`
`rights, prior to the filing of these counterclaims. Disney, on the other hand,
`
`registered at least 15 trademarks on the Pooh works in the United States, between
`
`1983 and 2006. .
`
`.
`
`. SS1 never objected to those registrations until 2006, when the
`
`state action for breach of the royalty agreement was dismissed, and these
`
`counterclaims were filed.
`
`[11] The Court is satisfied that under the clear terms of
`
`the parties’ agreements, SS1 transferred all of its rights in the Pooh works to
`
`Disney, and may not now claim infringement ofany retained rights.
`
`(Id. at 7:21—8:8 (emphasis added).) Based on that determination, the court dismissed SS1’s
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`Trademark Infringement claim, among others.
`
`(Id. at 8:8—l l .)2
`
`SS1 now argues that because the district court did not use the word “assignment” in
`
`describing the 1983 Agreement, the court’s ruling cannot preclude SS1 from advancing its “mere
`
`license” argument again before the Board. That is specious. Because SS1 contended that it
`
`retained ownership of the Pooh-related marks, SS1 explicitly requested affirmative relief from
`
`the district court in the form of a declaration instructing the PTO to change the title of any
`
`2 Note that SS1 had already agreed to stay the TTAB proceedings in favor of the district court
`proceeding. Then, SS1 filed a notice of appeal of the district court’s judgment, which was still
`pending when Disney filed its Motion to Dismiss the consolidated proceedings before this Board.
`SS1’s principal position in opposing Disney’s Motion had been that the pendency of SS1’s appeal
`requires the TTAB not to give the district court’s judgment preclusive effect. SS1 was wrong
`but, in any event, it has since voluntarily dismissed its appeal. (Exh. G (Stipulation to Voluntary
`Dismissal of Appeal); Exh. H (Order Dismissing Appeal).)
`
`Atty. Docket No.: 903423-300
`
`7
`
`

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`Disney-filed trademark registrations to SSI.
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`If the court had wanted to reserve judgment on the
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`question of ownership and trademark registration rights, while dismissing the remainder of SSI’s
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`Trademark Infringement claim, it would have done so.3 Instead, the court dismissed the entire
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`claim, making clear that it had determined SSI’s grant to be an assignment of all rights.
`
`SSI is also wrong in arguing that the language of the district court’s ruling is ambiguous.
`
`(SSI’s Opp.
`
`to Mot.
`
`to Dismiss at 8.). The district court’s f1ndings——-that through the 1983
`
`Agreement “SSI transferred all of its rights” and “retained no rights which Disney could
`
`infringe”-——are consistent only with a determination that SSI’s grant
`
`to Disney was an
`
`assignment. See Artoc Bank & Trust, Ltd. v. Apex Oil Co., 975 F.2d 1365, 1369 (8th Cir. 1992)
`
`(“An assignment has traditionally been defined in the law of contracts as a transfer by the
`
`assignor of all rights in the property assigned to the assignee.” (emphasis added)). Even without
`
`using the term “assignment,” where a party divests itself of “all right, interest, and control in the
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`property,” an assignment will be enforced.
`
`In re Computer Engineering Associates, Inc., 337
`
`F.3d 38, 46 (1st Cir. 2003) (citations and footnotes omitted; emphasis added).4
`
`3 District courts are empowered to grant summary adjudication on “all or any part” of a claim,
`including individual liability theories. Fed. Code Civ. Proc. 56(a) & (d); see also Optimum
`Technologies, Inc. v. Henkel Consumer Adhesives, Inc., 496 F.3d 1231, 1239, 1247 (11th. Cir.
`2007) (affirming grant of partial summary judgment on one of two theories advanced for
`trademark infringement claim); Jones v. City and County of San Francisco, 976 F. Supp. 896,
`904 (N .D. Cal. 1997) (“It is beyond cavil that the Court may properly resolve some legal claims
`by summary adjudication prior to a trial of the remaining claims.”). Were the court disinclined
`to grant partial summary judgment,
`it could have also denied Disney’s summary judgment
`motion as to the entire Trademark Infringement claim.
`4 SSI claims the words “grant” and “transfer” are consistent with both assignments and licenses.
`(Opp. at 11.) This argument and SSI's supporting authorities are irrelevant. Disney does not
`dispute that the words “grant” and “transfer” can be used generically to indicate a conveyance of
`rights, as they were in two cases cited by SSI (Pantone, Inv. v. Esselte Letraset, Ltd., 878 F.2d
`601, 602 (2d Cir. 1989) and Basic Fun, Inc. v. X-Concepts, LLC, 157 F. Supp. 2d 449, 455 (E.D.
`Pa. 2001)). Neither of those cases addressed the legal implication of a party “transferring all of
`its rights” and “retaining no rights that could be infringed.” That is what the district court
`determined to be the legal effect of the 1983 Agreement, and that finding is consistent only with
`an assignment. Artoc Bank & Trust, Ltd., 975 F.2d at 1369; In re Computer Engineering
`Associates, Inc., 337 F.3d at 46.
`
`Atty. Docket No.: 903423-300
`
`8
`
`

`
`Judge Smith’s recent ruling only further emphasizes the fallacy of SS1’s position.
`
`1n
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`recommending that SS1 be ordered to reimburse Disney for attorneys’ fees incurred in defending
`
`against SSl’s trademark and copyright
`
`infringement counterclaims, Judge Smith found it
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`“perplexing” that SS1 continues to assert an ownership interest in the Pooh works because the
`
`district court “undeniably considered the parties’ claims on the merits .
`
`.
`
`. and dismissed
`
`Slesinger’s copyright and trademark claims because Slesinger did not own any of the rights at
`
`issue.” (Exh. F at 19:19-22 (emphasis added).)
`
`SS1 argues that Judge Smith’s statements fail to apprehend the distinction SS1 now seeks
`
`to draw between whether and how it granted all of its rights.
`
`(SS1’s Opp. to Mot. to Dismiss at
`
`10—ll.) There is no basis for this assertion. SS1 had its chance to argue, and did vigorously
`
`argue, that Disney was a mere licensee with no rights to register trademarks in its own name.
`
`SS1’s position was rejected in a court ruling that is now final. SS1’s attempt to convince the
`
`Board to accept the exact opposition conclusion is wholly unwarranted.5
`
`B.
`
`The District Court Necessarily Ruled That SSl’s Grant to Disney Was An
`Assignment.
`
`For the same reasons as discussed above, the district court’s assignment finding was
`
`necessary to its decision. SS1’s Trademark lnfringement claim put the meaning and effect of the
`
`1983 Agreement squarely before the district court. SS1 alleged uses beyond the scope of the
`
`grant. SS1 also specifically alleged that Disney was a mere licensee with no rights to register
`
`trademarks in its own name, and sought a declaration from the district court instructing the PTO
`
`to change the title of all Disney—filed trademarks. The question of assignment—versus—license was
`
`therefore not “collateral” to the district court’s judgment, nor was it
`
`incidentally decided.
`
`5 1t is worth observing that in dismissing SSI’s copyright and trademark claims, the district court
`commented that “SSl’s conduct demonstrates a blatant effort to salvage its state court lawsuit
`against Disney by [taking an] entirely inapposite and inconsistent posture in this case.” (Exh. E
`at 10:20-22.)
`
`Atty. Docket No.: 903423-300
`
`9
`
`

`
`Mother’: Rest., Inc. v. Mama's Pizza, Inc., 723 F.2d 1566, 1571 (Fed.Cir. 1983). The district
`
`court could not have disposed of SSI’s Trademark Infringement claim in its entirety without first
`
`deciding that SS1’s grant to Disney was an assignment. The court made that determination, and
`
`on that basis dismissed SSI’s claim.
`
`Because the District Court issued a final and preclusive determination that SS1 has no
`
`ownership interest in the Pooh works, this Consolidated Oppositions should be dismissed.
`
`Dated: October 4, 2010
`
`Respectfully submitted,
`
`By:
`
`/Mark E. Miller/
`Mark E. Miller (Reg. No. 31,401)
`
`O’MELVENY & MYERS LLP
`
`Two Embarcadero Center, 28th Floor
`
`San Francisco, California 94111-3823
`Phone: 415.984.8700
`
`Fax: 415.984.8701
`
`Email: markmiller@omm.com
`
`Attorneys for Disney Enterprises, Inc.
`
`Atty. Docket No.: 903423-300
`
`10
`
`

`
`CERTIFICATE OF SERVICE
`
`The undersigned hereby certifies that a true and complete copy of the foregoing Reply
`
`Brief in Support of Motion to Dismiss has been served upon counsel for Opposer by mailing said
`
`copy via Federal Express mail on this October 4, 2010, to the following address:
`
`Andrew Di Skale, Esq.
`Mintz Levin Cohn Ferris Glovsky and Popeo, PC
`3580 Carmel Mountain Road, Suite 300
`San Diego, California 92130
`
`/Shabnam Malek/
`
`Shabnam Malek
`
`Atty. Docket No.: 903423-300
`
`l l
`
`

`
`EXHIBIT A
`
`

`
`
`
`JOSEPH W. COTCHETT (#36324)
`NANCY L. FINEMAN ($124870
`ROBERT B. HUTCHIN ON (#4 367)
`PHILIP L. GREGORY #95217
`DOUGLAS Y. PARK( 233398
`COTCHETT PITRE. SIMO & MCCARTHY
`840 Malcolm Road, Suite 200
`Burlingame, CA 94010
`Telephone: (650) 697~6000
`
`Attome s for Defendant and Counter-Claimant
`STEPHEN SLESINGER, INC.
`
`UNITED STATES DISTRICT COURT
`
`[PROPOSED]
`
`FOR THE CENTRAL DISTRICT OF CALIFORNIA
`1° CLARE MILNE, an individual,
`) Case NO. CV-02-08508 FMC (PLAX)
`11
`b and tbrou§h MICHAEL .
`)
`J SEPH CO
`her Receiver,
`DEFENDANT AND COUNTER-
`12
`and DISNEY ENTERPRISES,
`CLAIMANT STEPHEN SLESINGER,
`INC.
`INC.’S FOURTH AMENDED ANSWER
`AND COUNTERCLAIMS
`
`«'
`
`1. INFRINGEIVIENT OF RIGH S UNDER THE
`UNITED STATES COPYRI HT ACT
`
`2. TRADEMARK INFRINGEMENT
`
`3. TRADE DRESS INFRINGEMENT
`
`4. BREACH OF CONTRACT
`
`5. BREACH OF DWPLIED COVENANT
`OF GOOD FAITH AND FAIR DEALING
`
`) ) ) ) ) ) ) ) I
`
`) 3
`
`I HRAUD
`TORY RELIEF RE
`7 DE L
`' Tfi 13%|? ‘AGREEMENT
`8. DECLARATORY RELIEF RE
`IDITY OF
` ATION NOTI E
`9. DECLARATORY RELIEF RE
`INVALIDI
`OF I HE
`REVERSIOTFTAGREEMENT
`10. INJUNCTIVE RELIEF
`
`I 1. DECLARATORY RELIEF RE
`L
`TED SC PE OF HUNT
`TERIMINATISN NOTICE
`
`I2. VIOLATION OF CALIFORNIA BUSINESS
`AND PROFESSION CODE 17200
`.
`AND UNFAIR COMPETITION §
`et seq
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`JURY TRLAL DEMANDED
`
`) ) ) ) ) ) ) ) J) )
`
`STEPHEN SLESINGER, INC.’S FOURTH AMENDED ANSWER AND COUNTERCLAIMS
`Milne, et al. v. Stephen Slesinger, Inc., Case No. CV-02-08508 FMC (PLAX)
`
`
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`Plaintiffs,
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`V_
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`STEPHEN SLESINGER, INC.
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`Defendant.
`
`STEPHEN SLESINGER,INC.,
`Counter—Claimant,
`V.
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`DISNEY ENTERPRISES, INC.;
`THE WALT DISNEY
`COMPANY; and WALT
`DISNEY PRODUCTIONS
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`C0unter—DefeI:Idants.
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`16
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`26
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`LAW OFFICES
`
`COTCHETT,
`PITRE, SIMON &
`MCCARTHY
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`

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`I.
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`II.
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`INTRODUCTION .
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`JURISDICTION AND VENUE .
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`. 10
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`TABLE OF CONTENTS
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`ANSWER .
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`COUNTERCLAIMS .
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`Page No.
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`22
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`23
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`III.
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`IV.
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`THE PARTIES .
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`FACTUAL BACKGROUND .
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`A.
`THE POOH FAIVIILY OF CHARACTERS ARE BORN .
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`BACKGROUND ON STEPHEN SLESINGER .
`INITIAL AGREEMENTS BETVVEEN MILNE AND
`SLESINGER .
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`STEPHEN SLESINGER POPULARIZES POOH .
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`SHIRLEY SLESINGER LASSWELL CONTINUES TO
`DEVELOP THE POOH FAIVIILY OF CHARACTERS .
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`SLESINGER AND DISNEY: THE 1961 AGREEIVIENT
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`UNDERPAYMENTS BY DISNEY ARE EXPOSED AND
`THE PARTIES ENTER INTO THE 1983 AGREEIVIENT
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`DESPITE ITS PROMISES AND AGREEMENTS DISNEY
`CONTINUES TO UNDERPAY SLESINGER AFTER THE
`1983 AGREEMENT .
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`DISNEY IIVIPROPERLY USES THE COPYRIGHT ACT TO
`ATTEMPT TO CUT OFF SLESINGER’S RIGHTS .
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`B.
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`THE POOH BRAND IS CRITICAL TO DISNEY’S
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`K.
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`DISNEY’S IIVIPROPER ROYALTY STATEMENTS .
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`PRAYER FOR RELIEF .
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`JURY DEMAND .
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`. 47
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`. 52
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`
`STEPHEN SLESINGER, INC. S FOURTH AMENDED ANSWER AND COUNTERCLAIMS
`Milne, et al. v. Stephen Slesinger, Inc, Case No. CV-02-08508 FMC (PLAX)
`
`I
`
`24
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`V.
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`CLAIMS FOR RELIEF .
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`25
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`.26
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`27
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`28
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`9
`= WOWXCES
`TCHETI‘,
`’1TRE, SIMON &
`MCCARTHY
`
`

`
`
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`Defendant Stephen Slesinger, lnc., by its attorneys, answers the First
`2 Amended Complaint as follows:
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`l~3. Defendant admits that plaintiffs purport to assert that this Court has
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`4.
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`Defendant denies having sufficient knowledge or information to form
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`5.
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`Pooh Properties Trust, also on April 1, 1983 (the "1983 Agreement").
`8.
`Because the allegations contained in paragraph 8 are conclusions of
`law that require neither an admission nor a denial, defendant respectfully refers the
`Court to the statute and authorities interpreting the same for the meaning thereof.
`9.
`Because the allegations contained in paragraph 9 are conclusions of
`law that require neither an admission nor a denial, defendant respectfully refers the
`Court to the statute and authorities interpreting the same for the meaning thereof.
`
`
`
`STEPHEN SLESINGER, INC. ’S FOURTH AMENDED ANSWER AND COUNTERCLAIMS
`Mime, et al. v. Stephen Slesinger, Inc., Case No. CV—02-08508 FMC (PLAX)
`
`l
`
`8
`LAW OFFICES
`
`28
`
`COTCHETT,
`r§’f§a:§§‘§$,§§&
`
`

`
`
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`10. Defendant denies the allegations contained in paragraph 10 but admits
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`that plaintiffs characterize their action as set forth therein.
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`ll. Defendant denies having sufficient knowledge or information to form
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`a belief as to the allegations contained in the first sentence of paragraph 11 and
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`therefore denies the same, and denies the remaining allegations contained in
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`paragraph 11.
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`12. Defendant admits the allegations contained in paragraph 12.
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`13. Defendant denies having sufficient knowledge or information to form
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`a belief as to the allegations contained in paragraph 13 and therefore denies the
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`same.
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`,.
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`14. Defendant denies the allegations contained in paragraph 14 except
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`admits that in January 1930 A. A. Milne and defendant's predecessor, Stephen
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`Slesinger, entered into a Memorandum of Agreement (the "1930 Grant"), which
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`memorandum speaks for itself, and defendant respectfully refers the Court thereto
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`for the contents thereof and further admits the allegation contained in the last
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`sentence of paragraph 14.
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`15. Defendant denies having sufficient knowledge or information to form
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`a belief as to the allegations contained in paragraph 15 and therefore denies the
`same.
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`16. Defendant admits that it entered into an agreement in 1961 with Walt
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`Disney Productions (the "1961 Slesinger Disney Agreement") and further admits
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`that Walt Disney Productions entered into an agreement in 1961 with the
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`executors of the Milne estate and with Daphne Milne in her individual capacity,
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`which agreements speak for themselves, and defendant respectfully refers the
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`Court to the contents thereof and otherwise denies the allegations contained in
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`paragraph 16.
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`17. Defendant denies the allegations contained in paragraph 17 except
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`admits that in 1983 it entered into a new agreement with Walt Disney Productions,
`
`STEPHEN SLESINGER, INC.’S FOURTH AMENDED ANSWER AND COUNTERCLAIMS
`Milne, et al. v. Stephen Slesinger, Inc., Case No. CV-02-08508 FMC (PLAX)
`
`2
`
`
`
`28
`
`®
`c3i§mii£i-Sr,
`Pmus, SIMON &
`Mccimw
`
`

`
`1
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`Slesinger, Christopher Milne — plaintiff Clare Milne's father - and the Pooh
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`Properties Trust in which, inter alia, the 1930 Grant by A. A. Milne to defendant's
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`predecessor, and all amendments thereto, were revoked and a new grant of rights
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`was made to defendant and further admits that in 1983 Walt Disney Productions
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`and the Pooh Properties Trustees entered into an agreement.
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`18.
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`Defendant denies having sufficient knowledge or information to form
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`a belief as to the allegations of paragraph 18 and therefore denies the same except
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`asserts that the Termination Notices purportedly served by plaintiff Clare Milne
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`and Harriet Jessie Minette Hunt (the "Termination Notices") speak for themselves,
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`and respectfully refers the Court thereto for the contents thereof.
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`J
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`19.
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`Defendant denies having sufficient knowledge or information to form
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`a belief as to the allegations contained in paragraph 19 and therefore denies the
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`IO
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`11
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`same.
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`20. Defendant incorporates herein by reference all of the allegations and
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`averments contained in paragraphs 1 through 19 of this Answer.
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`21. Defendant denies having sufficient knowledge or information to form
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`a belief as to the allegations contained in paragraph 21 and therefore denies the
`same.
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`22. Defendant denies the allegations contained in paragraph 22.
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`23. Defendant admits the allegations contained in paragraph 23.
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`24. Defendant denies the allegations contained in paragraph 24 except
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`admits that Milne alleges that Milne seeks a declaration that the Milne
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`Termination Notice is valid.
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`25. Defendant incorporates herein by reference all of the allegations and
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`averments contained in paragraphs 1 through 24 of this Answer.
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`26. Defendant denies having sufficient knowledge or information to form
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`a belief as to the allegations contained in paragraph 26 and therefore denies the
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`28
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`same .
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`
`
`STEPHEN SLESINGER, [NC.’S FOURTH AMENDED ANSWER AND COUNTERCLAIMS
`Milne, et al. v. Stephen Slesinger, Inc., Case No. CV—02-08508 FMC (PLAX)
`
`3
`
`®Law omces
`COTCHETT,
`PITRE, SIMON &
`MCCARTPIY
`
`

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`27. Defendant admits the allegations contained in paragraph 27.
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`28.
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`Defendant denies the allegations contained in paragraph 28 except
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`admits that Disney alleges that it seeks a declaration that the Hunt Termination
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`Notice is valid.
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`AFFIRMATIVE DEFENSES
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`FIRST COMPLETE AFFIRMATIVE DEFENSE
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`29.
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`Plaintiffs’ First Amended Complaint fails to state a claim upon which
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`relief may be granted.
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`SECOND COMPLETE AFFIRMATIVE DEFENSE
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`30.
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`Plaintiffs’ claims fail because the agreement or agreements they claim.
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`8
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`9
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`10
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`11 will be terminated by the Termination Notices were lawfully revoked in 1983 and
`12
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`are no longer subject to termination.
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`THIRD COMPLETE AFFIRMATIVE DEFENSE
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`31.
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`Plaintiffs’ claims with respect to the agreements and events that took
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`place in 1983 are barred by the doctrines of laches, waiver, and/or estoppel.
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`FOURTH COMPLETE AFFIRMATIVE DEFENSE
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`32.
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`Plaintiffs’ claims based upon th