Trademark Trial and Appeal Board Electronic Filing System. 3935
`
`ESTTA Tracking number: ESTTA37412
`
`Filing date3
`
`06/30/2005
`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`Proceeding
`
`92044347
`
`Defendant
`Napster, Inc.
`Napster, Inc.
`§ 600 Chesapeake Drive
`Redwood City, CA 94063
`
`MICHAEL T. ZELLER
`C
`QUINN EMANUEL URQUHART OLIVER & HEDGES
`orrespondence 3
`Address
`1 865 SOUTH FIGUEROA STREET, 10TH FLOOR
`LOS ANGELES, CA 90017
`
`Submission
`
`Reply in Further Support for Petition for Stay
`
`Ffler's Name
`
`Michael T. Zeller
`
`Filer's e—mail
`Signature
`
`michae1ze11er@quinnernanuel.corn
`/Michael T. Zellerf
`
`iiiiiiiiiiiiiiiiiiiiiiiiiiiiii
`
`§ Supp1en1enta1Dec1arati0n.pdf ( 69 pages )
`
`

`
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`In the Matter of:
`
`Trademark Reg. No.
`Registration Date:
`For the Mark:
`
`2575170
`
`June 4, 2002
`NAPSTER
`
`Trademark Reg. No.
`Registration Date:
`For the Mark:
`
`2841431
`
`hday 11,2004
`NAPSTER
`
`Trademark Reg. No.
`Registration Date:
`For the Mark:
`
`2843786
`
`hAay18,2004
`NAPSTER
`
`Cancellation No. 92044347
`
`Trademark Reg. No.
`Registration Date:
`For the Mark:
`
`2843405
`
`May 18, 2004
`NAPSTER & Design
`
`RESPONDENT AND REGISTRANT
`
`NAPSTER, LLC’S REPLY IN
`FURTHER SUPPORT FOR PETITION
`FOR STAY
`
`SIGHTSOUND TECHNOLOGIES, INC.,
`
`Petitioner,
`
`V.
`
`NAPSTER, LLC,
`
`Respondent.
`
`Commissioner of Trademarks
`P.O. Box 1451
`
`Arlington, Virginia 22313-1451
`
`

`
`Introduction
`
`The circumstances here amply warrant a stay, and Petitioner is not being candid with the
`
`Board. The Petition for Cancellation is based upon, and overlaps with, counterclaims that
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`Respondent filed in a suit pending before the United States District Court for the Western
`
`District of Pennsylvania.
`
`Indeed, Petitioner now has admitted that the Petition for Cancellation
`
`involves issues “already” before the Pennsylvania District Cou11 and that it brought the Petition
`
`as a strategic counter-strike in response to those counterclaims. Although Petitioner suggests
`
`that this cancellation action should proceed anyway because the Pennsylvania District Court suit
`
`is stayed for the time being, that contention is unsupported by law or logic. Any rulings by the
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`Board will not be binding on the District Court, so both the Board’s and the parties’ resources
`
`will be wasted by litigating here issues that will have to be relitigated in the Pennsylvania
`
`District Court when the stay there is lifted. Furthermore, any grievance Petitioner allegedly has
`
`about the District Court’s stay can and should be addressed to that Court. What Petitioner surely
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`may not do, however, is seek to circumvent the District Cour1’s stay Order by prosecuting a
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`duplicative proceeding in this forum — which is precisely what Petitioner attempts here.
`
`The Petition does not stop at just raising issues that were already joined in the
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`Pennsylvania District Court and that remain pending there, however.
`
`It also collaterally attacks
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`the Order of yet another Court by alleging that
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`the Board should cancel
`
`the NAPSTER
`
`Registrations because their transfer pursuant to a Sale Order of the United States Bankruptcy
`
`Court for the District of Delaware was invalid. Since that Court is best situated to construe its
`
`own orders and is familiar with the bankruptcy’s voluminous record, Respondent filed a motion
`
`in the Bankruptcy Court on May 20, 2005 to enforce the Sale Order and the Asset Purchase
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`04635/652302
`
`1
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`REPLY ISO PETITION FOR STAY
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`

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`Agreement that the Court had approved.‘ By that motion, Respondent and its parent, Roxio,
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`Inc., have asked the Bankruptcy Court to determine that the Sale Order and Asset Purchase
`
`Agreement mean what they say: that notwithstanding the Petition for Cancellation’s allegations,
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`the Registrations and their good will were validly assigned in the bankruptcy proceedings.
`
`In opposing the present stay motion, Petitioner argues that there is no indication that the
`
`Bankruptcy Court will consider the relief requested by Respondent and that the Petition for
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`Cancellation does not challenge the Bankruptcy Court’s Sale Order. Even apart from the fact
`
`that
`
`the allegations of the Petition contradict
`
`the latter assertion, as discussed below the
`
`Bankruptcy Court expressly stated at an initial hearing on June 13, 2005 that the Petition does
`
`challenge the effect of the Bankruptcy Court’s Sale Order and indicated that such issues will be
`
`determined by the Bankruptcy Court at a future hearing currently set for August 2005.
`
`Because matters pending before the District Court and the Bankruptcy Court clearly may
`
`have a bearing on issues raised by the Petition, the most efficient, appropriate course is to stay
`
`this proceeding until the other actions are completed.
`
`Argument
`
`A.
`
`The Petition Raises Issues Pending Before The Bankruptcy Court
`
`Petitioner
`
`initially argues that
`
`the Petition for Cancellation “is not attacking the
`
`[Bankruptcy Court’s] Sale Order, but instead seeks a determination of Napster’s trademark rights
`
`subsequent to the acquisition.” Opp., pp. 3-4.2 However, it cannot be seriously disputed that the
`
`’ A copy of the Motion to Reopen Chapter 1 1 Case and Enforce Sale Order is Exh. 1 to the
`Declaration of Michael T. Zeller in support of Respondent and Registrant Napster, LLC’s
`Petition for Stay, dated May 24, 2005 and previously filed (“5/24/05 Zeller Dec.”).
`2 As supporting “proof,” Petitioner attaches the objections that it had filed with the Bankruptcy
`Court in response to Respondent’s motion. Petitioner also claims that Respondent’s motion in
`
`04635/652302
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`2
`
`REPLY ISO PETITION FOR STAY
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`

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`Petition explicitly challenges the validity of the assignment of the NAPSTER Registrations from
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`Napster, Inc., the original registrant, that had been approved by the Bankmptcy Court’s Sale
`
`Order on November 27, 2002.
`
`Indeed, the Petition specifically alleges that (i) “the Napster
`
`Marks were not validly transferred from Napster, Inc.”--the Debtor in the bankruptcy case--to
`
`Roxio (and subsequently to Respondent) because Roxio purportedly had “acquired the Napster
`
`Marks without
`
`the goodwill associated with the business”3 and (ii)
`
`the NAPSTER ITU
`
`Applications “were void as of the date of attempted assignment from Napster, Inc.”--which is
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`specifically identified as having occurred “on November 27, 2002,” i.e.,
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`the date of the
`
`Bankruptcy Court’s Sale Order—-because Roxio was “not a successor” of Napster,
`
`lnc.’s
`
`business.4
`
`More importantly, the Bankruptcy Court has already considered and rejected Petitioner’s
`
`claim that it has not attacked the Sale Order in the Petition fOl‘ Cancellation and stated on the
`
`record at a hearing on June 13, 2005 that the Petition in fact does challenge the Sale Order: 5
`
`. But
`.
`.
`MS. UHLAND [bankruptcy counsel for Respondent and Roxio, Inc.]:
`[there is] really only one fundamental question, which is were the good will and the
`[NAPSTER] marks transferred [in the bankruptcy proceedings]? And a clarifying order
`or an order enforcing [this] from [the] Court, we think is in the best interest of the entire
`process to streamline that.
`We also think it’s necessary because notwithstanding [SightS0und’s] statements
`in the objection, that they’re not attacking the sale order,
`the actual pleadings in
`TTAB, which we ’ve cited to in our reply, do state without clarifying the -- that it was
`post sale [conduct] or not, that these assets were not validly transferred to Roxio.
`Therefore, we do --
`
`the Bankmptcy Court “is currently being briefed and is scheduled for oral argument on August
`15, 2005.” Opp., p. 4. As explained below, these assertions are false or misleading at best.
`3 Petition at1[1[ 4, 5 (emphasis added).
`4 Petition at 1] 8 (emphasis added).
`5 A copy of the Transcript of Motion to Reopen and Enforce Sale Order is attached as Exh. A to
`the Supp. Decl. of Michael T. Zeller, dated June 30, 2005 and filed herewith (“Supp. Zeller
`Dec.”).
`
`04635/652302
`
`3
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`REPLY ISO PETITION FOR STAY
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`

`
`THE COURT: Well, I see from the petition they clearly make that allegation.
`And they’re making it now.
`MS. UHLAND: And they are now -- and they are -- on this new argument,
`they’re making it now.
`THE COURT: Yes."
`
`Petitioner’s second argument is that “there is no indication that the Bankruptcy Court”
`
`will consider the relief requested by Respondent and that Petitioner has “strongly contested” the
`77
`motion to reopen “on numerous procedural and substantive grounds. Opp., p. 4. Petitioner
`
`proceeds to claim that Respondent cannot “meet [the] burden" to “convince the Bankruptcy
`
`Court” to consider the relief it has sought.
`
`I_d, The Bankruptcy Court, however, also considered
`
`and squarely rejected Petitioner’s “procedural” arguments and determined that it would consider
`
`the relief requested by Respondent:
`
`. Number 1,
`
`I don’t
`
`they’ve
`
`.
`
`.
`
`for SightSound]:
`[counsel
`MR. MINUTI
`established cause to open up this bankruptcy case;
`I don’t think there’s subject matter jurisdiction to enter the relief they seek, which
`is an injunction against my client;
`.
`.
`.
`I don’t think they can obtain an injunction by way of a motion .
`I had a
`THE COURT: Well, let me just cut you [off] on the procedural issue.
`very, very similar situation in the Chapter 11 case about three years ago, I think, maybe
`three, four years ago. Cellnet. Cellnet sold to Schlumberger all its going business assets.
`And that included a contract that the debtor had with -- with a public utility, I think, in
`Minnesota. And two or three years after the case was closed, Schlumberger came back
`and asked me to enforce the sale order because the utility in Minnesota was engaged in an
`arbitration dispute with Schlumberger. And alleged certain contractual defaults which
`were pre-petition defaults and wanted me to rule -- and there are a lot of issues involved
`in the arbitration. And wanted me to rule as to what issues in the arbitration were barred
`by the sale order. And I denied their request. They took an appeal to the District Court,
`
`6 Id., Exh. A at 2023-18 (emphasis added). Petitioner’s “new argument” to which the Court and
`counsel referred also confirms what Petitioner continues to deny here, namely, that its challenge
`to the NAPSTER Registrations does implicate the Bankruptcy Court’s prior proceedings. At the
`June 13 hearing, Petitioner began arguing that the bankruptcy sale did not transfer to Roxio the
`intellectual property rights relating to Napster, Inc.’s business at all. Ld., Exh. A at 1125-21,
`14:6-8, 17:1-25.
`It is this “new argument” that will be aired at the further hearing set for August
`15, 2005 in the Bankruptcy Court. Li, Exh. A at 18:19-24, 21:5-22:21.
`
`04635/652302
`
`4
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`REPLY ISO PETITION FOR STAY
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`

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`and the District Court reversed and said to me, you tell the parties what’s in and what’s
`out.
`I think we have the same case here.7
`
`Removing any remaining doubt that Petitioner’s opposition to this stay motion is without
`
`merit,
`
`its recent discovery requests further establish that the Petition for Cancellation raises
`
`issues pending before the Bankruptcy Court by challenging the assignment of the NAPSTER
`
`Registrations and their good will that had been approved by the Bankruptcy Court. Petitioner's
`
`document requests in this cancellation proceeding demand, for example:
`
`0
`
`0
`
`0
`
`0
`
`0
`
`o
`
`“All documents referring or relating to the bankruptcy proceeding involving the Old
`Napster, including all submissions filed by Respondent with the Bankruptcy Court
`and all orders issued by the Bankruptcy Court related to Respondent’s acquisition
`of assets from Old Napster.”8
`(Petitioner defines the “Bankruptcy Court” in the
`Requests as “the U.S. Bankruptcy Court for the District of Delaware.”).9
`
`“All documents, agreements, submissions, court filings, bankruptcy papers and other
`materials related to the acquisition of the Napster Marks."‘1°
`
`“All documents referring or relating to Respondent’s acquisition of assets from the Old
`Napster, including assets other than the Napster Marks?”
`
`“All documents referring or relating to the purchase price paid by Respondent for Old
`Napster’s assets.”‘2
`
`“All documents referring or relating to press coverage of Old Napster’s bankruptcy,
`including Respondent’s bidding for and acquisition of Old Napster’s assets.”l3
`
`“All documents referring or relating to offers or bids made by Respondent for Old
`Napster’s assets.”14
`
`7 I_d_., Exh. A at 7:4-8:11.
`3 Supp. Zeller Dec., Exh. B (Petitioner’s First Requests for Production of Documents (“RFP”),
`Request No. 8 (emphasis added)).
`9 E. (Petitioner’s RFP, at 2 (incorporating Interrogatory definitions by reference)); Supp. Zeller
`Dec., Exh. C (Petitioner’s First Set of Interrogatories, Definition N).
`‘° Supp. Zeller Dec., Exh. B (Petitioner’s RFP, Request No. 26).
`“ E. (Petitioner’s RFP, Request No. 7 (emphasis added)).
`‘2 Q. (Petitioner’s RFP, Request No. 10).
`‘3 l_d. (Petitioner’s RFP, Request No. 12).
`“‘ 1gl_. (Petitioner’s RFP, Request No. 9).
`
`04635/652302
`
`5
`
`REPLY rso PETITION FOR STAY
`
`

`
`o
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`“All documents referring or relating to Respondent’s decision to acquire any of the assets
`of Old Napster, including the Napster marks.”15
`
`Similarly, Petitioner's interrogatories in this cancellation proceeding seek discovery on
`
`matters pending before the Bankruptcy Court. For example, one of Petitioner's interrogatories
`
`seeks the identity of “the person(s) most knowledgeable regarding the Napster Transaction,””’
`
`which Petitioner defines as “your acquisition of assets from the Old Napster, through the
`
`bankruptcy proceeding involving the Old Napster, by agreement
`
`(including the Asset
`
`Purchase Agreement dated 11/15/02) or otherwise.”17 Other such interrogatories include:
`
`0
`
`0
`
`0
`
`0
`
`“Identify all of the assets Respondent acquired from the Old Napster and the amount
`Respondent paid for each and the date(s) of transfer.”18
`
`‘‘Identify the person(s) who participated in the acquisition of Old Napster’s assets and
`identify all documents referring or relating thereto.” 9
`
`“Identify all of the assets that made up the ‘then-existing business’ of Old Napster
`referred to in paragraphs 7, 8 and 16 of the Answer.”2O
`
`‘‘Identify the goodwill in the Napster Marks that Respondent allegedly acquired from Old
`Napster and its value at the time of the acquisition.”2
`
`In sum,
`
`the validity of the assignment that Petitioner challenges in this cancellation
`
`proceeding is also squarely, and undeniably, at issue in the Bankruptcy Court ~ a conclusion
`
`clearly agreed with by the Bankruptcy Court. A stay is therefore appropriate here until the
`
`Bankruptcy Court has completed its work.
`
`'5 E. (Petitioner’s RFP, Request No. 6).
`“’ Supp. Zeller Dec., Exh. C (Petitioner’s Interrogatory No. 5).
`‘7 E. (Petitioner’s lnterrogatories, Definition M).
`'3 E. (Petitioner’s Interrogatory No. 4).
`‘° Id. (Petitioner’s Interrogatory No. 2).
`2° Id. (Petitioner’s Interrogatory No. 16).
`2‘ lc_l. (Petitioner’s Interrogatory No. 6).
`
`04635/652302
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`6
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`REPLY ISO PETITION FOR STAY
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`

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`B.
`
`The Petition Raises Issues Already Before The Pennsylvania District Court
`
`The Board also should issue a stay pending disposition of Petitioner’s counterclaims in
`
`the Pennsylvania District Court because additional issues raised by the Petition for Cancellation
`
`— namely, the alleged post-bankruptcy sale conduct of Respondent and Roxio — overlap with the
`
`District Court proceedings.” Petitioner does not seriously contest the duplication of issues on
`
`this score.
`
`Instead, Petitioner argues that no stay should be granted because Petitioner has not
`
`filed an answer to the counterclaims in Pennsylvania and relies on § 5l0.02(a) of the TBMP for
`
`the proposition that “absent consent of the parties, it is improper for TTAB to stay a case where
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`the issues in the other proceeding have not been joined[.]” _S_g Opposition, p. 4.
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`However, as that provision states on its face, a stay is inappropriate “only in those cases
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`where there is no stipulation to suspend and it is not possible for the Board to ascertain, prior to
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`the filing of an answer in one or both proceedings, whether the final determination of the other
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`proceedings will have a bearing on the issues before the Board.” TBMP § 5l0.02(a) (emphasis
`
`added). Not only does Petitioner’s pending motion to dismiss Respondent’s counterclaims in the
`
`District Court indeed “join” the issues, but even without an answer Petitioner’s own admissions
`
`conclusively show that the District Court proceedings may bear on issues before the Board.
`
`Specifically,
`
`in its arguments to the Bankruptcy Court, Petitioner acknowledged the
`
`overlap between the Pennsylvania District Court action and the Petition for Cancellation.
`
`It
`
`22 To be clear, the Petition overlaps with the action in the Pennsylvania District Court and the
`motion before the Bankruptcy Court in different respects. The issues raised by the Petition’s
`challenge to the assignment of the Registrations and their good will in the bankruptcy
`proceedings is currently pending before the Bankruptcy Court. The issues raised by the
`Petition’s reliance on post-bankruptcy conduct are before the Pennsylvania District Court (but
`not the Bankruptcy Court).
`It is for this reason that a stay pending resolution of both court
`actions is appropriate.
`
`04635/652302
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`7
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`REPLY ISO PETITION FOR STAY
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`

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`stated, for example, that “the issue joined between Roxio and SightSound is the impact under
`
`substantive trademark law of Roxio’s post—sale conduct with respect
`
`to the NAPSTER
`
`trademark, which is an issue properly (and already) before the US. District Court for the
`
`Western District ofPennsylvania .
`
`.
`
`. and the US. Patent and Trademark Office”. Objection to
`
`Motion to Reopen, 1] 2 (emphasis added);23 see also ti, 1] 18 (“Indeed, the issues are already
`
`pending in two other forums ~ the Pennsylvania District Court and the TTAB.”).
`
`As Petitioner also has admitted, the Petition for Cancellation is based upon Respondent’s
`
`counterclaims pending before the Pennsylvania District Court. Fhus, according to Petitioner, it
`
`brought this proceeding “to cancel Roxio’s trademark registrations for the Napster mark on the
`
`basis of Roxio’s position in the Pennsylvania District Court action”.
`
`31;,
`
`fil 11 (emphasis
`
`added). Elsewhere, Petitioner stated that its claims in the Petition “arise through Roxio’s post-
`
`sale rejection of the goodwill associated with the NAPSTER mark as evidence by its Defamation
`
`Claims against SightSound” in the Pennsylvania District Court.
`
`I_d., 11 35 (emphasis added).
`
`Indeed, Petitioner has acknowledged that
`
`it filed the Petition for Cancellation as a
`
`reactive proceeding to Respondent’s counterclaims in the Pennsylvania District Court. As
`
`Petitioner’s counsel has conceded, “we thought our [TTAB] petition was clear that we were
`
`basing it on their comments in the [Pennsylvania] defamation action. That’s why we brought the
`
`petition to cancel the trademarks.”24 Or, as Petitioner has also put it, “In the TTAB Petition
`
`proceeding, SightSound seeks only to defend itself by forcing Roxio to choose between its
`
`trademark registrations and its defamation claims”. lg, 11 34.
`
`23 A copy of Petitioner’s Objections to the Motion to Reopen is Iixh. D to the Supp. Zeller Dec.
`24 Supp. Zeller Dec., Exh. A at ll:24-12:2.
`
`04635/652302
`
`8
`
`REPLY ISO PETITION FOR STAY
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`

`
`Petitioner argues that its motion to dismiss the counterclaims renders it unclear whether
`
`the Pennsylvania District Court will adjudicate matters bearing on the issues before the Board.
`
`That contention fails. As demonstrated above, Petitioner has repeatedly admitted the overlap
`
`between this proceeding and the District Court action, even to the point of acknowledging that
`
`the Petition is based upon the Pennsylvania suit. Additionally, the motion to dismiss itself raises
`
`issues that may bear on issues raised by the Petition for Cancellation. As shown in the stay
`
`motion, and as is undisputed, Petitioner’s motion to dismiss the counterclaims relies on the same
`
`allegations set forth in paragraphs 3, 4 and 5 of the Petition.”
`
`Petitioner decries the Pennsylvania District Court’s decision to stay the case pending
`
`before it, but that is of no moment. A stay of this proceeding will be the most efficient course
`
`because of the non-binding effect of TTAB’s rulings on district courts.
`
`fig; The Other
`
`Telephone Co. v. Connecticut Nat’l Telephone Co., 181 U.S.P.(). 779, 782 (Comm’r of Patents
`
`1974) (“while a decision of a Federal District Court would be binding on the [PTO], a decision
`
`by the Trademark Trial and Appeal Board would be merely advisory with respect
`
`to the
`
`disposition of issues presented in a Federal District Court”). Litigation in this forum thus would
`
`be a waste of the Board’s (and the parties’) resources because, once the District Court stay is
`
`lifted, the same issues will be re-litigated by the parties in Pennsylvania anyway.
`
`If anything, the Pennsylvania District Court’s stay underscores the appropriateness of a
`
`stay of these cancellation proceedings. The proprietary of the District Court’s stay is for that
`
`Court
`
`to determine, not
`
`for Petitioner
`
`to unilaterally circumvent by filing duplicative
`
`proceedings. Yet, that is what Petitioner attempts here. As Petitioner has conceded, the Petition
`
`25 5/24/05 Zeller Dec., Exh. 4, at 1-2, 7-8.
`
`04635/652302
`
`9
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`REPLY ISO PETITION FOR STAY
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`

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`for Cancellation is based upon and in reaction to Respondent’s Pennsylvania counterclaims.
`
`And, for good measure, Petitioner now has propounded in this cancellation proceeding document
`
`requests and interrogatories that demand discovery regarding the “reputation” of the “Old
`
`Napster” and thus seek discovery on Respondent’s counterclaims in the Pennsylvania action, in
`
`defiance of the District Court’s stay Order.26 Petitioner’s stratagem should not be countenanced
`
`by the Board. Cf Shmuel Shmueli Bashe Inc. v. Lowenfeld, 68 F. Supp. 2d 161, 165-66
`
`(E.D.N.Y. 1999) (noting in analogous context that where duplicative litigation has been brought
`
`to skirt the Order of another court, "it should hardly need saying that the court where the
`
`duplicative action is brought may not lend its hand to the advancement of such tactics.").27
`
`The most appropriate, and efficient, course of action is to stay the current proceeding.
`
`Dated: June 30, 2005
`
`Respectfully submitted,
`
`By: mm... 7 ,—-
`QUINN EMANUE1
`RQUHART
`OLIVER & HEDGES, LLP
`Michael T. Zeller
`
`Michael E. Williams
`
`865 South Figueroa Street, 10th Floor
`Los Angeles, California 90017
`Telephone: (213) 443-3000
`Facsimile:
`(213) 443-3100
`Attorneys for Respondent
`Napster, LLC
`
`2° Egg Supp. Zeller Dec., Exh. B (Petitioner’s RFP Nos. 1, 23, 24) & Exh. C (Petitioner’s
`Interrogatory Nos. 26, 27)
`27 Also hollow are Petitioner’s contentions that the present stay motion is an attempt to avoid
`having any forum adjudicate the Petition’s spurious allegations. The point of this motion is that
`those issues should be decided by the Courts where those issues are pending. Asking that the
`most efficient forum decide a question is scarcely an effort to avoid a merits determination. Nor
`does Petitioner cite authority for the proposition that it is at liberty to institute duplicative
`proceedings here merely because it prefers a schedule different from the one adopted by the
`Pennsylvania District Court, let alone so that Petitioner can evade the stay Order of that Court.
`
`04635/652302
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`10
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`REPLY ISO PETITION FOR STAY
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`

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`Proof of Service
`
`I hereby certify that a true and complete copy of the foregoing Respondent and Registrant
`
`Napster, LLC’s Petition for Stay has been served on William K. Wells by mailing said copy on
`
`June 30, 2005, via First Class Mail, postage prepaid to:
`
`William K. Wells
`
`Brian S. Mudge
`Susan A. Smith
`
`KENYON & KENYON
`
`1500 K Street, N.W., Suite 700
`
`Washington, DC 20005
`Tel.: (202) 220-4200
`
`Fax: (202) 220-4201
`
`04635/652302
`
`11
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`REPLY ISO PETITION FOR STAY
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`

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`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`
`Cancellation No. 92044347
`
`SUPPLEMENTAL DECLARATION
`
`OF MICHAEL T. ZELLER IN
`SUPPORT OF RESPONDENT AND
`REGISTRANT NAPSTER, LLC’S
`MOTION TO STAY
`
`In the Matter of:
`
`Trademark Reg. No.
`Registration Date:
`For the Mark:
`
`2575170
`June 4, 2002
`NAPSTER
`
`Trademark Reg. No.
`Registration Date:
`For the Mark:
`
`2841431
`May 11, 2004
`NAPSTER
`
`Trademark Reg. No.
`Registration Date:
`For the Mark:
`
`2843786
`May 18, 2004
`NAPSTER
`
`Trademark Reg. No.
`Registration Date:
`For the Mark:
`
`2843405
`May 18, 2004
`NAPSTER & Design
`
`SIGHTSOUND TECHNOLOGIES, INC.,
`
`Petitioner,
`
`v.
`
`NAPSTER, LLC,
`
`Respondent.
`
`Commissioner of Trademarks
`P.O. Box 1451
`
`Arlington, Virginia 22313-1451
`
`04635/664149
`
`SUPP. DECL. ISO PETITION FOR STAY
`
`

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`1, Michael T. Zeller, do hereby declare and state as follows:
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`1.
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`I am a member of the State Bars of California, New York and Illinois and am
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`counsel for Napster, LLC in these proceedings and for Napster, LLC and Roxio, Inc. in
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`Sz'ghtS0und Technologies, Inc. v. Roxio, Inc., and Napster, L.L.C., Civil Action No. 04-1549
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`(W.D. Pa.), and In re: Enco Recovery Corp. f/k/a/Napster, Inc., No. 02-11573 (PJW) (Bankr. D.
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`Del.).
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`I have personal knowledge of the facts stated herein and, if sworn as a witness, could and
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`would testify competently thereto.
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`2.
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`The United States Bankruptcy Court for the District of Delaware conducted a
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`hearing on Respondent’s Motion to Reopen Chapter 11 Case and Enforce Sale Order on June 13,
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`2005. A true and correct copy of the Transcript of Motion to Reopen and Motion to Enforce
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`Sale Order is attached hereto as Exhibit A.
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`3.
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`A true and correct copy of Petitioner’s First Requests for Production of
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`Documents in these cancellation proceedings is attached hereto as Exhibit B.
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`4.
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`A true and correct copy of Petitioner’s First Set of Interrogatories in these
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`cancellation proceedings is attached hereto as Exhibit C.
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`5.
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`A true and correct copy of Petitioner’s Objection to Motion to Reopen Chapter
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`11 Case and Enforce Sale Order, without accompanying exhibits, is attached hereto as Exhibit D.
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`I declare under penalty of perjury under the laws of the United States of America that the
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`foregoing is true and correct.
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`Executed this 30th day of June, 2005, at Los Angeles, California.
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`II/Wvh
`
`chael T. Zeller
`
`04635/664149
`
`2
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`SUPP. DECL. ISO PETITION FOR STAY
`
`

`
`
`
`EXHIBIT AEXHIBIT A
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`

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`UNITED STATES BANKRUPTCY COURT
`DISTRICT OF DELAWARE
`
`IN RE:
`
`ENCO RECOVERY CORP.,
`f/k/a NAPSTER,
`INC.,
`a Delaware corporation,
`et a1.,
`
`Debtors.
`
`Case No. 02-11573
`
`Chapter 11
`
`Courtroom No. 2
`824 Market Street
`
`Wilmington, Delaware 19801
`
`June 13, 2005
`2:51 P.M.
`
`esysrx/s./\./\/‘est
`
`TRANSCRIPT OF MOTION TO REOPEN AND MOTION
`TO ENFORCE SALE ORDER
`BEFORE HONORABLE PETER J. WALSH
`UNITED STATES BANKRUPTCY JUDGE
`
`APPEARANCES:
`
`For Roxio/Napster, LLC: Richards Layton & Finger, PA
`By: MARK COLLINS, ESQ.
`One Rodney Square, P.O. Box 551
`Wilmington, Delaware 19899
`
`Quinn Emanuel Urquhart Oliver
`& Hedges, LLP
`By: MICHAEL ZELLER, ESQ.
`865 South Figueroa Street, 10th Floor
`Los Angeles, California 90017
`
`0'Me1veny & Myers LLP
`By:
`SUZZANNE UHLAND, ESQ.
`610 Newport Center Drive
`Newport Beach, California 92660-6429
`
`The U.S. Trustee:
`
`Office of the U.S. Trustee
`
`DAVID L. BUCHBINDER, ESQ.
`By:
`844 King Street
`Wilmington, Delaware 19899
`
`Proceedings recorded by electronic sound recording,
`transcript produced by transcription service.
`
`
`TRANSCRIPTS PLUS
`435 Riverview Circle, New Hope, Pennsylvania 18938
`e-mail courttranscriptsgagaolxom
`
`215-862-1115 (FAX) 215-802-6639
`
`

`
`Appearances:
`(Continued)
`
`For former Chapter 11
`Trustee,
`former Plan
`Administrator:
`
`For Sightsound
`Technologies:
`
`Ashby & Geddes
`By: WILLIAM P. BOWDEN, ESQ.
`222 Delaware Avenue, 17th Floor
`Wilmington, Delaware 19801
`
`Saul Ewing, LLP
`By: MARK MINUTI, ESQ.
`222 Delaware Avenue, Suite 1200
`P.O. Box 1266
`
`Wilmington, Delaware 19899
`
`Kenyon & Kenyon
`By:
`SUSAN SMITH, ESQ.
`1500 K Street, N.W., Suite 700
`Washington, District of Columbia 20005
`
`

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`THE COURT: Please be seated.
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`MR. COLLINS: Good afternoon, Your Honor.
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`For the
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`record, Mark Collins of Richard Layton and Finger on behalf of
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`Roxio, Inc. and Napster, LLC.
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`Your Honor, before we begin with our —— and if the
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`presentation of our motion should reopen the Chapter 11 case
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`and enforce a sale order, I'd like to make some brief
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`introductions.
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`I move the admission pro hac vice of Suzzanne Uhland
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`from the law firm of O'Me1veny & Myers and Michael Zeller of
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`the Quinn Emanuel firm.
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`Your Honor, we have filed pro hac vice motions with
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`the Court.
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`THE COURT: Okay.
`
`MS. UHLAND: Your Honor, with that, I'll turn the
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`podium over to Ms. Uhland for presentation of our motion.
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`THE COURT: Yes?
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`MS. UHLAND: Good afternoon, Your Honor. We're back
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`here two and a half years after the sale, which I represented
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`Roxio which now goes by the name of Napster, as well,
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`in the
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`acquisition of the assets of the Napster Chapter 11 estate for
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`approximately $5.7 million.
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`Since the time of that transaction,
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`there's been an
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`action filed in the TTAB,
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`the Trademark Appeal Board, seeking
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`to challenge the transfer of the title of the trademark that
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`Roxio, we believe, validly acquired pursuant to this Court's
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`order.
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`The relief we're seeking today is very limited, and
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`we do not seek the Court to interpret any actions beyond what
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`happened in connection with the sale approved by this Court.
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`We simply want an order enforcing the Court's order
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`that title to the Napster assets,
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`including the good will and
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`the Napster marks, were transferred to Roxio at the time of the
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`closing of that transaction.
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`1O
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`Now, it may be, Your Honor,
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`that there is not much in
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`dispute in light of SightSound’s objection. While in the TTAB
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`proceeding, Sightsound, we believe, clearly attached this
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`Court's order stating there was not a valid transfer of these
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`assets.
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`In their objection,
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`they state that there was —-
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`they
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`are not challenging this Court's sale order. But,
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`instead,
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`the
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`post sale conduct by Roxio.
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`In an effort to reach agreement and limit this relief
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`that we're seeking today, we have gone back through and revised
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`our proposed sale order to clarify that the limited relief that
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`we're seeking to reopen this case solely for an entry of an
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`order enforcing the sale order,
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`indeed, only applies to
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`essentially what happened in this courtroom and the subsequent
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`closing and does not pertain to post sale contact.
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`We have a redline version of the order which I'd like
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`

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`to hand up to the Court in which we've provided to the counsel
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`for Sightsound, if I may do so.
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`THE COURT: Okay.
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`MS. UHLAND: Our changes begin at Page 2 in
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`Paragraphs B, C and D. Again,
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`in which we limit this Court's
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`findings --
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`THE COURT:
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`I'm --
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`MS. UHLAND: —- with respect to the acquisition.
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`THE COURT:
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`I'm sorry. Let me see.
`
`Page 2?
`
`MS. UHLAND:
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`Page 2 of the order.
`
`THE COURT: Okay.
`
`MS. UHLAND:
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`Paragraphs B, C and D. Where we limit
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`the findings we are requesting of this Court regarding the
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`acquisition of the Napster assets to the closing of the
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`transaction.
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`In each case,
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`the intent of this is to clarify
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`that we are not asking this Court to rule on any post sale
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`conduct of the parties.
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`THE COURT: Okay.
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`MS. UHLAND:
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`In addition, on the subsequent page, we
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`deleted —— and our redlining program didn't quite work, we
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`deleted Paragraph H of the order seeking, again,
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`to make this
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`relief as focused and limited as possible. And in the
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`operative provisions of the order, modified the injunctive
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`language to simply clarify that we're not seeking an
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`injunction, but also to clarify for the purposes of the TTAB
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`

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`that this order is enforceable against Sightsound,
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`the third
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`party.
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`THE COURT: Let me see.
`
`(Pause)
`
`THE COURT: Okay. Have you shared this with
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`respondents?
`
`MS. UHLAND: We provided it to them before the
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`hearing while we were waiting.
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`THE COURT: Well, let me hear from the respondents.
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`Is this acceptable or not?
`
`MR. MINUTI:
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`It is not, Your Honor.
`
`THE COURT:
`
`I think it is.
`
`MR. MINUTI:
`
`If I may be heard, Your Honor?
`
`THE COURT: Yes.
`
`M. MINUTI: Good afternoon, Your Honor. Mark
`
`Minuti.
`
`I'm here today for Sightsound Technologies,
`
`Incorporated.
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`With me at counsel table, Your Honor,
`
`is Susan Smith.
`
`She is with the Kenyon & Kenyon firm,
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`that is IP counsel to
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`Sightsound.
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`Your Honor, let me —— I'll briefly tell you why I
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`don't think this order is acceptable. And then if Your Honor
`
`will permit me,
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`I want to talk a little bit about how we got
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`here and why it is. Really,
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`the substance of the order is not
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`acceptable.
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`But