Trademark Trial and Appeal Board Electronic Filing System. http://estta.uspto.gov
`ESTTA376957
`ESTTA Tracking number:
`11/04/2010
`
`Filing date:
`IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
`92048502
`Plaintiff
`G. PTAK, LLC
`JEFFREY H WEINBERGER
`WEINBERGER COUNSEL PC
`475 PARK AVENUE SOUTH, 33RD FLOOR
`NEW YORK, NY 10016
`UNITED STATES
`jhw@weinbergercounsel.com
`Other Motions/Papers
`Weinberger Counsel, P.C.
`jhw@weinbergercounsel.com
`/s/ Jeffrey H. Weinberger
`11/04/2010
`FRCP-60.Pltff-Opp.-1.pdf ( 112 pages )(1952830 bytes )
`
`Proceeding
`Party
`
`Correspondence
`Address
`
`Submission
`Filer's Name
`Filer's e-mail
`Signature
`Date
`Attachments
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 1 of 112
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE SOUTHERN DISTRICT OF NEW YORK
`______________________________________________________________
`
`)
`PTAK BROS. JEWELRY, INC.,
`)
`PLAINTIFF’S OPPOSITION TO
`Plaintiff,
`)
`DEFENDANT GARY PTAK’S
`v.
`)
`) MOTION FOR RELIEF FROM
`GARY PTAK and G. PTAK, LLC
`JUDGMENT
`Defendants.
`)
`__________________________________________)
`
`Case 06-cv-13732 (CM/HP)
`
`PX-22
`
`Dkt. 10.11
`
`Ptak Bros Jewelry Inc v Gary Ptak + • 06-cv-1373 Plaintiff’s Opposition to R60 Motion
`
`

`
`
`
`Case 1:06-cv-13732-DC Document 10-11 Filed 02/02/2007 Page 10 of 10Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 2 of 112
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 3 of 112
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE SOUTHERN DISTRICT OF NEW YORK
`______________________________________________________________
`
`)
`PTAK BROS. JEWELRY, INC.,
`)
`PLAINTIFF’S OPPOSITION TO
`Plaintiff,
`)
`DEFENDANT GARY PTAK’S
`v.
`)
`) MOTION FOR RELIEF FROM
`GARY PTAK and G. PTAK, LLC
`JUDGMENT
`Defendants.
`)
`__________________________________________)
`
`Case 06-cv-13732 (CM/HP)
`
`PX-29
`
`Dkt. 12.2
`
`Ptak Bros Jewelry Inc v Gary Ptak + • 06-cv-1373 Plaintiff’s Opposition to R60 Motion
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 4 of 112
`Case1:06—cv—13732—CM Document 82-1
`Filed 06/15/10 Page4of112
`Filed 04/06/2007
`Page 26 of 42 -
`
`Case 1 :06—cv-13732-DC Document 12-2
`
`} SS_.
`State of New York .
`Department ofSra!e )
`
`I hereby cemfir that the annexed copy has been cmnpared with the original document in the custody afrhe Secretary
`ofSmre mm‘ that the same is a true copy ofsaid ririgirtaf.
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`W:‘mess my hand and sea! afrhe Depamnenr ofslare on
`
`March 28, 2007
`
`Special Depmy Secretary nfstare
`
`C§@fi~
`
`nos-1233 (Haw. 11:05)
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 5 of 112
`Case 1:06—cv—13732—CM Document 82-1
`Filed 06/15/10 Page 5 of 112
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`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 6 of 112
`Case 1:06—cv—13732—CM Document 82-1
`Filed 06/15/10 Page 6 of 112
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`Case 1:06~cv-13732-DC Document 12-2
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`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 7 of 112
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE SOUTHERN DISTRICT OF NEW YORK
`______________________________________________________________
`
`)
`PTAK BROS. JEWELRY, INC.,
`)
`PLAINTIFF’S OPPOSITION TO
`Plaintiff,
`)
`DEFENDANT GARY PTAK’S
`v.
`)
`) MOTION FOR RELIEF FROM
`GARY PTAK and G. PTAK, LLC
`JUDGMENT
`Defendants.
`)
`__________________________________________)
`
`Case 06-cv-13732 (CM/HP)
`
`PX-71
`
`Dkt. 13
`
`Ptak Bros Jewelry Inc v Gary Ptak + • 06-cv-1373 Plaintiff’s Opposition to R60 Motion
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 8 of 112
`Case 1 :06-cv—13732-CM Document 82-1
`
`
`
`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
`_
`_
`_
`_
`_
`_
`_
`_
`-
`_
`-
`_
`-
`_
`
`_
`
`_ _x
`
`PTAK BROS.
`
`JEWELRY,
`
`INC.,
`
`Plaintiff,
`
`— against
`
`—
`
`:
`
`:
`
`MEMORANDUM DECISION
`
`O6 Civ. 13732 (DC)
`
`GARY PTAK and G. PTAK, LLC,
`
`Defendants.
`
`_
`
`_
`
`-
`
`_
`
`_
`
`_
`
`-
`
`_
`
`_
`
`_
`
`_
`
`_
`
`_
`
`-
`
`_
`
`_
`
`_
`
`_X
`
`APPEARANCES:
`
`LAW OFFICES OF JOHN R. MUGNO
`
`John Robert Mugno, Esq.
`By:
`350 Broadway, 10th Floor
`New York, NY
`10013
`— and —
`KEGAN & KEGAN, LTD
`
`By: Daniel L. Kegan, Esq.
`79 W Monroe St., #1320
`Chicago,
`IL 60603
`Attorneys for Plaintiff
`
`TRACHTENBERG RODES & FRIEDBERG, L.L.P.
`
`By: David G. Trachtenberg, Esq.
`Anne W. Salisbury, Esq.
`545 5th Ave.
`
`10017
`New York, NY
`Attorneys for Defendants
`
`CHIN, D.J.
`
`Plaintiff Ptak Bros. Jewelry,
`
`Inc.
`
`(”PBJ") brings this
`
`action for trademark infringement under the Lanham Act, 15 U.S.C.
`
`§ 1051 et seg., against defendants Gary Ptak and G. Ptak, LLC.
`
`PBJ also asserts claims for cyberpiracy, unfair competition, and
`
`other violations of state law.
`
`PBJ contends that defendants have
`
`been infringing upon its ”PTAK"
`
`trademarks, which it purchased at
`
`auction. Accordingly, PBJ moves for a preliminary injunction
`
`under Rule 65(a) of the Federal Rules of Civil Procedure.
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 9 of 112
`
`For the reasons set forth below, the motion is granted.
`
`Pursuant to Federal Rule of Civil Procedure 65, my findings of
`
`fact and conclusions of law follow.1
`
`FINDINGS OF FACT
`
`I.
`
`History of Ptak Bros., Inc.
`
`Ptak Bros., Inc. -- the predecessor to PBJ -- was
`
`founded in 1946 by three brothers with the surname Ptak. (Compl.
`
`2
`¶ 11). Ownership rights were eventually transferred to the
`
`founders' children -- cousins Saree, Gary, and Alan Ptak
`
`(respectively, "Saree," "Gary," and "Alan") -- who were each left
`
`with one-third of the shares. (Pl. Mem. Exs. 1, 20).
`
`In February 2003, Saree brought a petition for judicial
`
`dissolution of Ptak Bros., Inc. (Pl. Mem. Exs. 1, 20; Pl. Reply
`
`Mem. Ex. 27). In or about April 2004, Saree, Gary, and Alan (and
`
`others) entered into a Settlement Agreement and Release to
`
`discontinue the petition for judicial dissolution and all related
`
`claims and counterclaims. (Id.). In addition, they agreed to
`
`carry out a nonjudicial dissolution of the company. (Pl. Mem.
`
`Exs. 1, 20). Under the Settlement Agreement, the assets of the
`
`1
`
`In considering this motion, I did not hold an
`evidentiary hearing. In its motion papers, PBJ asserts that no
`hearing is required. (Pl. Mot. at 2). Likewise, defendants have
`not requested a hearing. I therefore decide this motion solely
`on the papers.
`
`2
`
`I have cited to the verified complaint for certain
`undisputed facts. See Parke, Davis & Co. v. Amalgamated Health &
`Drug Plan, Inc., 205 F. Supp. 597, 601 (S.D.N.Y. 1962) ("Where
`the pleadings are properly verified, they may serve the office
`both of pleadings and evidence on an application for a temporary
`injunction.").
`
`-2-
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 10 of 112
`
`company were to be sold, and the proceeds were to be distributed
`
`to the creditors of the company, with the balance to be
`
`distributed in equal amounts to Gary, Alan, and a trust
`
`established for the benefit of Saree. (Pl. Reply Mem. Ex. 27 ¶
`
`3). According to the Settlement Agreement, the assets were to
`
`include "the names 'Ptak Brothers', 'Ptak Bros.', and 'Ptak'
`
`(collectively 'Company Name'), customer list(s), supplier list(s)
`
`and form of catalog." (Pl. Reply Mem. Ex. 28 (as supplemented)).
`
`Alan and Saree, contending that Gary was not complying
`
`with the above Settlement Agreement for nonjudicial dissolution,
`
`moved the state court for injunctive relief to carry out the
`
`dissolution procedures. (Pl. Mem. Exs. 1, 20). The court
`
`granted their motion, and ordered, inter alia, that the company
`
`be liquidated in accordance with the Settlement Agreement.
`
`(Id.).
`
`The assets of Ptak Bros., Inc. were to be sold at
`
`auction on August 13, 2004. (Pl. Mem. Ex. 9). Although Gary was
`
`a shareholder at the time of the auction, he had left his
`
`employment at Ptak Bros., Inc. several months earlier to start
`
`3
`his own jewelry business. (Gary Ptak Decl. ¶ 8). Thus,
`
`potential bidders were notified of the following about Gary Ptak
`
`at the auction:
`
`For bidders on the trade name, please be
`aware that Gary Ptak, one of the current
`owners of Ptak Bros., Inc., currently
`
`3
`
`According to defendants' website, Gary started his
`business sometime around 2004. See http://www.garyptak.com/
`history.html (last visited May 16, 2007).
`
`-3-
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 11 of 112
`
`operates his own jewelry business. His
`business does not operate under the name Ptak
`Bros., Inc., only the winning bidder will be
`able to use Ptak Bros., Inc., but obviously
`his last name is Ptak and he does use his
`last name in the course of doing business as
`"Custom Jewelry by Gary Ptak." Bidders on
`the trade name must be aware of this and
`accept this in making their bids.
`
`(Morfino Decl. ¶ 4; Pl. Mem. Ex. 7).
`
`Although still a shareholder, Gary nevertheless
`
`submitted a bid of $305,000 for just the trademarks and other
`
`intellectual property of Ptak Bros., Inc. (Morfino Decl. ¶ 9).
`
`He was outbid, however, by Carl Morfino, who bid $1,020,000 for
`
`all the assets to Ptak Bros., Inc. (Id.). After the auction,
`
`PBJ was promptly incorporated, and Morfino transferred all the
`
`assets of Ptak Bros., Inc. to PBJ. (Id. ¶ 15; Morfino Reply
`
`Decl. ¶ 14).
`
`On October 4, 2004, the Bill of Sale between Ptak
`
`Bros., Inc. and PBJ was signed by Alan Ptak on behalf of Ptak
`
`Bros., Inc. (Morfino Decl. ¶ 15; Pl. Mem. Ex. 2). Gary,
`
`however, was not involved in the negotiation, drafting, or
`
`execution of the Bill of Sale or any other personal contract with
`
`plaintiff. (Gary Ptak Decl. ¶ 16). Nor did he sign the Bill of
`
`Sale. (Pl. Mem. Ex. 2).
`
`The Bill of Sale assigned to PBJ:
`
`(i) the trade name "Ptak Bros., Inc." and any
`and all derivatives thereof . . . (ii) the
`Telephone Numbers; and (iii), the URL
`http://www.ptakbros.com; (iv) any and all
`right title and interest in and to all
`creative and photographic materials relating
`to the most recent Ptak Bros., Inc. catalogs;
`and (v) all rights, title and interest in and
`
`-4-
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 12 of 112
`
`to the customer lists and information
`(approximately 30,000[] customers). The
`foregoing assignment shall also include,
`without limitation, an assignment by Assignor
`to Assignee of all internet registration
`rights, internet domain rights, e-mail
`addresses, Federal and State trademarks,
`service marks, copyrights, common law rights
`and any and all other intellectual property
`rights associated with or arising therefrom.
`
`(Id.).
`
`There was also a restrictive covenant, dated October 4,
`
`2004, signed by Gary, Alan, and PBJ. (Pl. Mem. Ex. 3). The
`
`restrictive covenant provided that as shareholders of Ptak Bros.,
`
`Inc., Gary, Alan, and Saree "covenant[] and agree[] not to use,
`
`in the jewelry business, the Company name [Ptak Bros., Inc.] on
`
`his/her or its own behalf, or on behalf of any entity directly or
`
`indirectly owned or controlled by him/her or it, or in the case
`
`of the Trust created in connection with the Company, by either
`
`Trustee." (Id.). It further provided, however, that Gary and
`
`Alan would not be precluded from using "his/her own first and
`
`last name (and/or initials) for personal or business purposes,
`
`including in connection with the jewelry business. By way of
`
`example . . . it would be permissible for a Shareholder of the
`
`Company to use the name 'Custom Jewelry by Gary Ptak,' but not
`
`'Ptak Custom Jewelry' or 'Alan Ptak, formerly of Ptak Bros.' and
`
`the like." (Id.). In addition, there was no non-compete clause
`
`or language in either the restrictive covenant or the sale
`
`documents. (Gary Ptak Decl. ¶¶ 13-14).
`
`-5-
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 13 of 112
`
`II. Reputation of Ptak Bros., Inc.
`
`Over several decades, Ptak Bros., Inc. earned a
`
`reputation for high quality jewelry. (Morfino Decl. ¶ 10). It
`
`provided service to more than 30,000 wholesale and retail
`
`customers throughout the United States. (Id. ¶ 17). As a
`
`result, the trademarks "PTAK" and "PTAK BROS." had become
`
`nationally known since at least 1997 for its jewelry goods and
`
`services. (Id.). The PTAK name had also been prominently
`
`displayed on printed and Internet-based catalogs, order forms,
`
`marketing materials, and various jewelry items. (Id.).
`
`PBJ -- the successor in interest to Ptak Bros., Inc. --
`
`continues to use the PTAK and PTAK BROS. trademark for marketing
`
`purposes. (Morfino Decl. ¶ 18). This includes the use of PTAK
`
`in its telephone and fax numbers, which are 800-345-PTAK and 800-
`
`PTAK-FAX, respectively. (Id. ¶ 19). It also includes the use of
`
`the same style format and style numbers used in Ptak Bros., Inc.
`
`printed catalogs. (Id. ¶¶ 18, 30-38).
`
`III. Defendants' Use of the PTAK Name
`
`Defendants continued to use the Ptak name for various
`
`activities. For example, Gary, acting through his wife Elyse
`
`Spies, ordered Verizon to redirect any faxes sent to the Ptak
`
`Bros. fax number (800-PTAK-FAX) to Gary Ptak, LLC. (Pl. Mem. Ex.
`
`10; Morfino Decl. ¶ 20). This transfer was discovered after PBJ
`
`began receiving complaints from customers that sales orders and
`
`other communications were not being acknowledged. (Morfino Decl.
`
`-6-
`
`

`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 14 of 112
`
`¶ 21). Gary agreed, on October 4, 2004, to retransfer the fax
`
`number back to PBJ. (Id.).
`
`Gary has also been using the telephone number 800-PTAK-
`
`112 for his personal jewelry business. (Id. ¶ 22). PBJ's
`
`attorney wrote defendants in February 2006 asserting that their
`
`use of a phone number containing "PTAK" was in violation of the
`
`Bill of Sale and the restrictive covenant. (Id. ¶¶ 22, 24).
`
`This notice contained a demand that defendants cease and desist
`
`using the number. (Id. ¶ 24). Defendants have removed the
`
`letters of the phone number ("PTAK") from their web page, but
`
`customers can still reach defendants through that same number.
`
`(Id. ¶ 23).
`
`Moreover, defendants associate themselves with Ptak
`
`Bros., Inc. with statements on their website such as: "Gary spent
`
`14 years honing his craft at Ptak Bros. Inc." (Id. ¶ 40; Pl.
`
`Mem. Ex. 5). Gary also asserts that he is the sole legitimate
`
`successor to Ptak Bros., Inc., and states that he is the
`
`historical successor to the "Ptak Family," and "The Company."
`
`(Morfino Decl. ¶ 41).
`
`Both the website and catalogs for G. Ptak, LLC contain
`
`a section about Gary's family history, which traces Gary's family
`
`lineage. (Pl. Mem. Ex. 6). The section also talks about how the
`
`Ptak Bros., Inc. company was formed. (Id.). For example, the
`
`section takes the reader through various decades, and begins with
`
`pictures and descriptions of Gary's grandparents, who immigrated
`
`from Poland. (Id.). It further describes how Gary's father and
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`his uncles joined together to build a jewelry business bearing
`
`their name. (Id.). Near the end of the family history section,
`
`it says that "[i]n 2004, Gary Ptak, LLC opens for business,
`
`proudly continuing the greater than 60 year Family tradition.
`
`Upon information and belief, Gary Ptak, LLC remains the only
`
`Ptak-owned and operated jewelry manufacturing firm in existence
`
`today." (Id.). It concludes with the following:
`
`Dear Friends (both old and new),
`For over 60 years it has been my family's
`tradition to offer superior quality and
`service to compliment our extensive
`collection of styles. . . . [N]othing makes
`me more proud than to continue this tradition
`with an altogether improved operation.
`Welcome to Gary Ptak, LLC.
`
`(Id.).
`
`In addition, the G. Ptak, LLC November 2006 catalog
`
`contains the phrase "PTAK: GOOD THINGS COME IN SMALL PTAKAGES!"
`
`-- which is not a registered mark according to the records of the
`
`U.S. Patent and Trademark Office. (Morfino Decl. ¶ 43).
`
`Gary Ptak has also made arrangements so that anytime a
`
`user enters "http://www.ptak.com" he or she will automatically be
`
`redirected to the G. Ptak, LLC jewelry website. (Morfino Decl. ¶
`
`44). And on defendants' home page at www.garyptak.com, the name
`
`"Gary Ptak" appears on the top left hand corner with the "Gary"
`
`in gold and the "Ptak" in silver. (Id. ¶ 47; Def. Mem. Ex. B).
`
`Finally, a comparison of defendants' November 2006
`
`catalog with Ptak Bros. books 22, 23, and 24 shows that more than
`
`25% of defendants' products are identical to those that used to
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`be manufactured and sold by Ptak Bros. Inc. (Morfino Decl. ¶
`
`35).
`
`PROCEDURAL HISTORY
`
`On December 4, 2006, PBJ filed a complaint against
`
`defendants, alleging, inter alia, claims of cyberpiracy, federal
`
`unfair competition and false designation of origin, trademark
`
`infringement, unlawful deceptive acts and practices, and breach
`
`of contract. On February 2, 2007, plaintiff filed the instant
`
`motion for a preliminary injunction. Thereafter, the parties
`
`sought to agree on the terms of a preliminary injunction, but
`
`were unable to agree on all the terms.
`
`DISCUSSION and CONCLUSIONS OF LAW
`
`PBJ asks for broad relief. (See Pl. Reply Mem. Revised
`
`Proposed Order). Defendants are willing to consent to most of
`
`the requested relief, with the caveat that they are doing so only
`
`for purposes of the preliminary injunction, and that the consent
`
`is not a concession with respect to the merits of the case.
`
`(Def. Mem. at 1). The only objections made by defendants are
`
`that: (1) they believe that "Ptak Bros." or "Ptak Brothers" may
`
`be referenced in a narrative, factual history -- such as on the
`
`"Family History" section of their website and catalog -- and they
`
`would be willing to place an appropriate disclaimer stating that
`
`they are not connected with PBJ (Def. Mem. at 2); (2) they
`
`believe that the "Gary Ptak" logo placed on their website -- with
`
`the "Ptak" in different font color -- does not create confusion
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`(id. at 2-3); and (3) they wish to defer making any changes in
`
`their catalogs until the next printing (id. at 3-4).
`
`The disagreement between PBJ and defendants primarily
`
`involves the scope of relief that I should grant. Nevertheless,
`
`I still must decide whether PBJ satisfies the standard for a
`
`preliminary injunction under the Lanham Act. If so, I then
`
`decide the scope of PBJ's requested relief.
`
`I.
`
`Preliminary Injunction Under Lanham Act
`
`The Lanham Act provides for a cause of action against
`
`[a]ny person who . . . in connection with any
`goods or services . . . uses in commerce any
`word, term, name, symbol, or device, or any
`combination thereof, or any false designation
`of origin, false or misleading description of
`fact, or false or misleading representation
`of fact, which--
`
`(A) is likely to cause confusion, or to cause
`mistake, or to deceive as to the affiliation,
`connection, or association of such person
`with another person, or as to the origin,
`sponsorship, or approval of his or her goods,
`services, or commercial activities by another
`person.
`
`15 U.S.C. § 1125(a)(1).
`
`Thus, the "key for a plaintiff in proving infringement
`
`of its trademark is to show the likelihood of consumer
`
`confusion." Brennan's, Inc. v. Brennan's Restaurant, L.L.C., 360
`
`F.3d 125, 128 (2d Cir. 2004) (citing Restatement (Third) of
`
`Unfair Competition § 21 cmt. a (1995)).
`
`To prevail on a motion for a preliminary injunction,
`
`the moving party must demonstrate a threat of irreparable injury
`
`and either (1) a probability of success on the merits or (2)
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`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 18 of 112
`
`sufficiently serious questions going to the merits to make them
`
`fair grounds for litigation and a balance of hardships tipping
`
`decidedly in the moving party's favor. See, e.g., Time Warner
`
`Cable v. Bloomberg L.P., 118 F.3d 917, 923 (2d Cir. 1997).
`
`Irreparable injury exists where, but for the granting of the
`
`preliminary injunction, it would be difficult or impossible to
`
`return the parties to the positions they previously occupied.
`
`See Brenntag Int'l Chems., Inc. v. Bank of India, 175 F.3d 245,
`
`249 (2d Cir. 1999). In trademark disputes, "a showing of
`
`likelihood of confusion establishes both a likelihood of success
`
`on the merits and irreparable harm." Malletier v. Burlington
`
`Coat Factory Warehouse Corp., 426 F.3d 532, 537 (2d Cir. 2005)
`
`(quoting Hasbro, Inc. v. Lanard Toys, Ltd., 858 F.2d 70, 73 (2d
`
`Cir. 1988)).
`
`Whether there is likelihood of confusion is determined
`
`by a multi-factor test set forth in Polaroid Corp. v. Polarad
`
`Elecs. Corp., 287 F.2d 492, 495 (2d Cir. 1961). The test
`
`includes several non-exclusive factors, such as: (1) the strength
`
`of the mark, (2) the degree of similarity between the two marks,
`
`(3) the competitive proximity of the products, (4) actual
`
`confusion, (5) the likelihood the plaintiff will bridge the gap,
`
`(6) the defendant's good faith in adopting its mark, (7) the
`
`quality of the defendant's products, and (8) the sophistication
`
`of the purchasers. See Mobil Oil Corp. v. Pegasus Petroleum
`
`Corp., 818 F.2d 254, 256 (2d Cir. 1987) (citing Polaroid, 287
`
`F.2d at 495). No factor is dispositive, and a court is not
`
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`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 19 of 112
`
`limited to these factors. Polaroid, 297 F.2d at 495. Moreover,
`
`"each factor must be evaluated in the context of how it bears on
`
`the ultimate question of likelihood of confusion as to the source
`
`of the product." Lois Sportswear, U.S.A., Inc. v. Levi Strauss &
`
`Co., 799 F.2d 867, 872 (2d Cir. 1986).
`
`A trial court has discretion to fashion a preliminary
`
`injunction that will preserve the status quo pending a trial on
`
`the merits. Arthur Guinness & Sons, PLC v. Sterling Pub. Co.,
`
`732 F.2d 1095, 1099 (2d Cir. 1984); see also Grand Union Co. v.
`
`Cord Meyer Dev. Co., 761 F.2d 141, 147 (2d Cir. 1985) (district
`
`court has broad discretion to "devise whatever remedy it believes
`
`in its discretion is necessary to make . . . injured parties
`
`whole") (internal quotations omitted). The decision to grant or
`
`deny preliminary injunctive relief rests within the sound
`
`discretion of the trial court, and will not be disturbed on
`
`appeal absent a showing of abuse of discretion. See Arthur
`
`Guinness & Sons, 732 F.2d at 1099.
`
`II. Application
`
`Two issues are presented. The first is whether PBJ has
`
`met the standard for a preliminary injunction. The second is, if
`
`so, the scope of relief.
`
`A.
`
`Issuance of a Preliminary Injunction?
`
`The primary issue is whether plaintiff has shown
`
`likelihood of confusion because in trademark cases, "a showing of
`
`likelihood of confusion establishes both a likelihood of success
`
`on the merits and irreparable harm." Malletier, 426 F.3d at 537;
`
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`
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`
`Hasbro, 858 F.2d at 73. Based on the various factors delineated
`
`in Polaroid, plaintiff has established a likelihood of confusion.
`
`See Mobil Oil Corp., 818 F.2d at 256. Here, however, not all of
`
`the factors are relevant. Rather, the factors directly relevant
`
`in this instance are: (1) strength of the mark, (2) degree of
`
`similarity, (3) the competitive proximity of the products, and
`
`(4) actual confusion. I discuss them in turn.
`
`1.
`
`Strength of the Mark
`
`The strength of a mark refers to "its tendency to
`
`identify the goods sold under the mark as emanating from a
`
`particular, although possibly anonymous, source." McGregor-
`
`Doniger Inc. v. Drizzle Inc., 599 F.2d 1126, 1131 (2d Cir. 1979).
`
`Courts typically assess the strength of a mark through two
`
`components: inherent distinctiveness and the distinctiveness the
`
`mark has acquired in the marketplace. Brennan's, 360 F.3d at
`
`130-31. Inherent distinctiveness "examines a mark's theoretical
`
`potential to identify plaintiff's goods or services without
`
`regard to whether it has actually done so." Id. at 131.
`
`Acquired distinctiveness, on the other hand, refers to the
`
`"recognition plaintiff's mark has earned in the marketplace as a
`
`designator of plaintiff's goods or services." Id. (citing to
`
`TCPIP Holding Co. v. Haar Communications, Inc., 244 F.3d 88, 97
`
`(2d Cir. 2001)).
`
`a.
`
`Inherent Distinctiveness of Family Names
`
`The Second Circuit has made clear that family names are
`
`descriptive and do not by themselves identify a product. Id. A
`
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`
`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 21 of 112
`
`proper name merits protection, however, if the name develops a
`
`secondary meaning, such that the name comes to identify the
`
`product as originating from a single source. See Gruner + Jahr
`
`USA Publ'g v. Meredith Corp., 991 F.2d 1072, 1076 (2d Cir. 1993).
`
`Nevertheless, "courts generally are hesitant to afford strong
`
`protection to proper names, since to do so preempts others with
`
`the same name from trading on their own reputation." Brennan's,
`
`360 F.3d at 131.
`
`Here, the Court is not persuaded that Ptak Bros., Inc.
`
`has developed a secondary meaning, such that the name has come to
`
`identify the product -- namely, jewelry -- as originating from a
`
`single source. See Gruner, 991 F.2d at 1076 (examples include
`
`IVORY for soap, EXXON for oil, and KODAK for photography).
`
`Indeed, defendants show that in the wholesale jewelry business,
`
`it is common to have numerous family-owned businesses with the
`
`same surname. (Gary Ptak Decl. ¶ 18) (stating that in New York
`
`City alone, there are, for example, several "Fabrikants,"
`
`"Simontovs," "Kohanims," and "Verstandigs" in the jewelry
`
`business). Moreover, PBJ does not present evidence supporting
`
`the inherent distinctiveness of the Ptak Bros. name.
`
`b.
`
`Acquired Distinctiveness
`
`On the other hand, PBJ has introduced some evidence
`
`that Ptak Bros., Inc. has achieved distinctiveness in the jewelry
`
`market. For example, PBJ has presented evidence that Ptak Bros.,
`
`Inc. has been providing high quality jewelry for several decades
`
`now, and has a customer list that exceeds 30,000 customers.
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`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 22 of 112
`
`(Morfino Decl. ¶¶ 10, 17). Moreover, it has provided evidence
`
`that annual sales and gross profits for Ptak Bros., Inc. from
`
`1998 through 2003 ranged from three to six million dollars.
`
`(Morfino Reply Decl. ¶ 15).
`
`In addition, defendants do not dispute that Ptak Bros.
`
`and Ptak Brothers are common law trademarks (Gary Ptak Decl. ¶
`
`10), and thus are entitled to some protection. Accordingly,
`
`although PBJ's name is not inherently distinctive, there is
`
`evidence to show that it has acquired distinctiveness, and is
`
`entitled to some protection.
`
`2.
`
`Degree of Similarity
`
`Without need for much discussion, this factor favors
`
`PBJ, as both PBJ and defendants use Ptak in their names. PBJ's
`
`name is Ptak Bros. Jewelry, Inc., while defendants is G. Ptak,
`
`LLC.
`
`3.
`
`Competitive Proximity of Products
`
`The proximity of products asks the extent that the two
`
`products compete with each other. See Cadbury Beverages, Inc. v.
`
`Cott Corp., 73 F.3d 474, 480 (2d Cir. 1996). This factor also
`
`favors PBJ, as both are involved in the business of providing
`
`jewelry products and services.
`
`4.
`
`Actual Confusion
`
`Here, PBJ has provided documentary evidence of twenty-
`
`nine instances where customers and retail jewelers have actually
`
`been confused about whether a catalog sent to them was from PBJ
`
`or defendants. (Morfino Reply Decl. ¶¶ 3-9 & Ex. 24). In one
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`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 23 of 112
`
`example, two retailers stated that they thought defendants might
`
`be the original Ptak Bros. company after having read the family
`
`history pages in defendants' catalog. (Morfino Reply Decl. ¶ 6 &
`
`Ex. 24). In another example, at least five customers asked PBJ
`
`to see merchandise from a catalog, not realizing that they were
`
`looking at defendants' catalog. (Morfino Reply Decl. ¶ 7 & Ex.
`
`24). And in a third example, two jewelers mistakenly ordered
`
`products from defendants, when in fact, they thought they were
`
`ordering from PBJ. (Morfino Reply Decl. ¶ 8 & Ex. 24).
`
`Notwithstanding the documented instances of actual
`
`confusion, defendants declare that they have not seen or heard of
`
`any confusion between the two companies. (Gary Ptak Decl. ¶ 20).
`
`This blanket declaration, however, is unpersuasive in light of
`
`the evidence produced by PBJ. Moreover, I weigh this factor more
`
`heavily because the test here is for likelihood of confusion, and
`
`nothing is more directly relevant than examples where consumers
`
`and retailers were actually confused.
`
`In view of the above factors, PBJ is entitled to
`
`preliminary injunctive relief, as it has demonstrated a
`
`likelihood of confusion. See Malletier, 426 F.3d at 537.
`
`B.
`
`What Relief Is Appropriate?
`
`I now determine the scope of relief. Defendants have
`
`agreed -- for purposes of this motion only -- to nearly all of
`
`plaintiff's requested relief. The only exceptions are: (1)
`
`defendants believe they should be able to use "Ptak Bros." in a
`
`narrative, factual history, such as in the "Family History"
`
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`Case 1:06-cv-13732-CM Document 82-1 Filed 06/15/10 Page 24 of 112
`
`section of their website and catalog, and they are willing to
`
`insert a disclaimer; (2) they believe that the "Gary Ptak" logo
`
`placed on their website -- with the "Ptak" in different font
`
`color -- does not create confusion; and (3) they wish to defer
`
`making any changes in their catalogs until the next printing.
`
`As an initial matter, a district court has broad
`
`discretion in fashioning the scope of relief. See Arthur
`
`Guinness & Sons, 732 F.2d at 1099; Grand Union, 761 F.2d at 147.
`
`Thus, I devise a remedy pending a trial on the merits.
`
`1.
`
`Family History
`
`With respect to the use of "Ptak Bros." in a narrative
`
`for the Family History section of defendants' website and
`
`catalog, I conclude that these references are permitted in part.
`
`First, there is no agreement or contract that prohibits
`
`Gary from describing his family history, including the fact that
`
`he may have worked at Ptak Bros. It is true that the restrictive
`
`covenant signed by Gary provides that he cannot use "Ptak Custom
`
`Jewelry" or "Gary Ptak, formerly of