FILED: NEW YORK COUNTY CLERK 06/23/2016 11:56 AM
`NYSCEF DOC. NO. 121
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`INDEX NO. 652490/2016
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`RECEIVED NYSCEF: 06/23/2016
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`Exhibit A
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`FILED: NEW YORK COUNTY CLERK 03/05/2012
`NYSCEF DOC. NO. 30-7
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`INDEX NO. 604403/2005
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`RECEIVED NYSCEF: 03/05/2012
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`Exhibit E
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`Eddie Sitt v. Ralph Sitt, et al.
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`No. 652490/16
`Page 1 of 26
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`UNITED STATES DISTRICT COURT
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`CENTRAL DISTRICT OF CALIFORNIA
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`BARBARA ALLBUT BROWN, et a1.,
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`Plaintiffs,
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`CASE NO. CV 98-5381 DT
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`(RZx)
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`ORDER GRANTING DEFENDANTS'
`MOTION TO DISMISS PLAINTIFFS'
`FIRST AMENDED COMPLAINT
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`vs.
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`::. 6, ?C:"'YGRAII.1 RECCR:::S I et a1. I
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`Defendants.
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`I.
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`A.
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`Background
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`Factual Summary
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`This case involves claims brought by Plaintiffs Barbara
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`:1 Allbut Brown ~"BrownU), Peggy Santiglia Davison ("Davison U
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` Phyll is Al1bu: S irico I
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`("Sirico") (collecti ve1y "Plaintiffs")
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`I and
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`;J against Polygram Records ("Polygram"), Mercury Records I
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`Inc.
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`26
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`271
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`:"~erclryfl) ar:d FGG Productions, Inc.
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`("FGG") (collectively
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`"Cefendants") fer damages and injunctive and declaratory relief
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`Eddie Sitt v. Ralph Sitt, et al.
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`No. 652490/16
`Page 2 of 26
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`in connection with the use of the name "The Angels," which is the
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`professional name under which the Plaintiffs performed as a
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`singing group. The causes of action contained in Plaintiffs'
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`Pirst Amended Complaint are as follows:
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`The first cause of action is by Davison and Sirico for
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`infringement of a registered trademark against all Defendants;
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`(2) The second cause of action is by all Plaintiffs for
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`false designations and descriptions against all Defendants;
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`(3) The third cause of action is by all Plaintiffs for
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`unfair competition against all Defendants;
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`(4) The fourth cause of action is by Brown and Sirico for
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`breach of contract against PGG;
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`(5)
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`The fifth cause of action is by Brown and Sirico for
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`rescission against FGG;
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`(6) The sixth cause of action is by all Plaintiffs for
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`constructive trust against FGG;
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`(7) The seventh cause of action is by all Plaintiffs for
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`accounting against all Defendants;
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`(8) The eighth cause of action is by all Plaintiffs for
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`fraud against FGG;
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`(9)
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`The ninth cause of action is by Davison for conversion
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`against all Defendants;
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`(10) The tenth cause of aotion is by Davison for trespass
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`to chattel against all Defendants; and
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`The eleventh cause of action lS by all Plaintiffs for
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`declaratory relief against all Defendants.
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`Eddie Sitt v. Ralph Sitt, et al.
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`No. 652490/16
`Page 3 of 26
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`Plaintiffs allege that on or about March 25, 1963,
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`21 Brown and Sirico entered into a contract with Sabina Records
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`that it was to be interpreted under the
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`25, 1963, after execution of the Sabina Contract, Sabina Records
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`assigned its rights in the Sabina Contract to FGG. ~ at , 18.
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`Plaintiffs state that Davison was never a party to the
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`"Sablna ContractU) under which all musical records and tapes
`4~ recorded by Brown and Sirico would become the property of Sabina
`~I Records.
`In return, Sabina Records would pay Brown and Sirico
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`61' specified royalties of all records sold by Sabina records or any
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`7! affiliate or licensee. Amended Complaint at ~ 15. The Sabina
`8~ Contract also provided
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`:aws of the State of New York. ~ at ~ 14. On or about March
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`2C; sales of Brown and Sirico's recordings. 1 ~ at ~ 20. The FGG
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`Sabina Contract, but sometime in 1963, Davison joined the group
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`"The Angelsu and took part in recording songs, including "My
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`...:.... -' '.
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`Boyfriend's Back."
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`l..d.... at ~ 19.
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`"My Boyfriend's Back" became
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`Mer2ury's largest album hit. Plaintiffs' Opposition at 1.
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`Plaintiffs allege that on or about June 13, 1963, Brown
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`~ ......
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`and Sirico slgned a contract with FGG
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`("FGG Contract H
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`) under
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`which FGG would pay Brown and Sirico specified royalties based on
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`: Plaintiffs did not attach the Sabina Contract or the FGG
`Contract to their First Amended Complaint. However, Defendants
`submitted a copy of the Sabina Contract with their motion to
`dismiss. They represent that they requested a copy of the Sabina
`Contract from Plaintiffs and that Plaintiffs gave them a copy of
`the Sabina Contract but that page 10 is missing and Plaintiffs
`have been unable to locate page 10. Defendants also represent
`that neither party has been able to locate a copy of the FGG
`Contract.
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`Eddie Sitt v. Ralph Sitt, et al.
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`No. 652490/16
`Page 4 of 26
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`11 Contract also provided that it was to be interpreted under the
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`laws of the Stare of New York. ~ Subsequencly, in June 1963,
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`FGG granted ~ercury and/or Phonogram "the exclusive and
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`perpetual rights" to che master recordings of, and the use of,
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`the compositlons and performances recorded by Brown and Sirico,
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`including but not limited to, "My Boyfriend's Back./I
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`I.d... at ~
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`Plaintiffs allege that they did not receive any royalty
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`IIi payments since receiving an initial payment in the early 1960's.
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`l..d..... at ~ 23.
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`At some ~nspecified time, PolyGram became the successor-in-
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`interest to Mercury and Phonogram and assumed all the rights and
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`obligations under the agreements with FGG. ~ at ~ 22.
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`In ~anuary 17, 1995, the United States ~rademark and
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`?atent Offi~e lss~ed a serVlce ~ark registration of the name "The
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`Angels," to Plaintiffs Sirico and Davison. Exhibit "AU attached
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`to Amended Complaint.
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`B.
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`Procedural Summary
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`On July 6, 1998, Plaintiffs filed the Complaint for
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`Damages and for Injunctive and Declaratory Relief.
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`On August 6, 1998, Plaintiffs filed a Notice of
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`21J Voluntary Di~missal Without Prejudice as to Defendant Mason &
`22~ Company, which this Court granted on August 10, 1998.
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`C.""t:1 COr:1plalnt
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`On August 26, 1998, Plaintiffs fi:led the First Amended
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`Or .. Se.;:":ernber 17 j
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`:JefE::-~jal:ts fi~ed a Notice of
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`26 Motion and Motion to Dismiss Plaintiffs' First Amended Complaint,
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`Eddie Sitt v. Ralph Sitt, et al.
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`No. 652490/16
`Page 5 of 26
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`1'1 which is before this Court today.
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`2~ Court does not have personal jurisdiction over FGG and that
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`3) Plaintiffs fail to state their claims.
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`II. Personal Jurisdiction Over FGG Is Improper
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`Defendants contend that this
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`A.
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`Standard
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`In order to maintain an action in the Central District,
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`a plaintiff must meet the requirements of 28 U.S.C. § 1391(A) and
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`must establish that this Court has personal jurisdiction over a
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`defendant. Spe FDIC v. Bdtish-Amerjcan Ins. Co. I Ltd., 828 F.2d
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`1439, 1441 (9th Cir. 1987).
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`In order to establish personal
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`jurisdiction over a nonresident defendant, a plaintiff must show
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`that the forum state's jurisdictional statute confers personal
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`jurisdiction over the defendant, and that the exercise of
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`jurisdiction accords with constitutional principals of due
`s.ae. j,akp v, Lake, 817 F.2d 1416, 1420 (9th Cir. 1987).
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`process.
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`Because California Civil Procedure Code Section 410.10 extends
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`jurisdiction to the maximum extent permitted by due process, the
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`state and due process jurisdictional inquiries can be conducted
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`as one analysis. ~ Cal. Civ. Proc. Code § 410.10 (West 1973).
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`Due process requires that a non-resident defendant have
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`sufficient minimum contacts with the forum state so that
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`"maintenance of a suit does not offend traditional notions of
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`fair play and substantial justice."
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`International Shoe Co. v,
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`Washington, 326 U.S. 310, 316 (1945)
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`Courts may exercise either
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`general or specific personal jurisdiction over a nonresident
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`26 defendant. ~ FDIr, 828 F.2d at 1442.
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`Eddie Sitt v. Ralph Sitt, et al.
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`No. 652490/16
`Page 6 of 26
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`On a motion to dismiss for lack of personal
`2 ~ :urisdiction, a plaintiff need only make a prima facie showing
`jurisdiction exists. See Dara Disc. Inc. v.
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`""S4y-"s..."r....op--,illw' "'"s----'T'-"p...;c ......... h~n .... o"_· l'"-'o .... g~y.-J,:.A .... s'"-'s""-""'o .... c'-'-'.~ ..... I .... n-'-c~., 5 5 7 F. 2 d 12 8 C,
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`(9 t h C i r .
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`2.977) .
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`1. General Jurisdiction.
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`General jurisdiction exists when a nonresident
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`jefe~dant has "substantial, continuous and systematic" activities
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`with the forum state, even if the cause of actien is unrelated to
`s...e..e Perkins y. Eenquet Consolidated
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`these forum activities.
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`Mi'ling ('0., 342 U.S. 437 (1952) .
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`2.
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`Specific Jurisdiction.
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`If a defendant's ccn~acts with the fcr~~ state are not
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`l4~ substantial or continuous and systematic, this Court may only
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`15ij exercise jurisdiction over the defendant if the alleged
`s...e..e Bral'ld. v. Menloye
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`16 I! acti vi ties occurred in the forum state.
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`-'71 :':--::t;r.e,
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`'796 F.2d 1070, 1073 :9th Cir. 1986).
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`I:: crder to confer
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`l3J speclfic personal jurisdiction in this Court, a plaintiff must
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`sho'd that:
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`the nonresident defendant purposef~lly directed
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`activities or consummated transactions with the forum
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`or residents thereof, or performed some act by which he
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`purposefully avai led himsel f of the pri ,'i lege of
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`conducting activities in the forum, thereby invoking
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`the benefits and protections of its laws;
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`Eddie Sitt v. Ralph Sitt, et al.
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`Page 7 of 26
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`(2)
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`the claim arises out of or relates to the
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`defendant's forum related contacts; and
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`(3)
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`the exercise of jurisdiction is reasonable, meaning
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`that it comports with fair play and substantial
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`justice.
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`Data Disc, 557 F.2d at 1287.
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`B. Analysis
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`Defendants seek to dismiss FGG from this suit for lack
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`personal jurisdiction.
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`FGG is a New York corporation, with
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`Thus, both
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`plaintiffs and Defendants concede that this Court does not have
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`general jurisdiction over FGG. Accordingly, this Court must
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`determine whether it can exercise specific jurisdiction over FGG.
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`1.
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`FGG has not purposefully availed itself of the
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`privilege of conductin~ business in this forum
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`Plaintiffs claim that FGG should be subject to suit in
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`California because it has purposefully availed itself of the
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`privilege of conducting business within California.
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`Specifically, Plaintiffs assert that FGG's act of producing and
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`licensing the master-recordings, which Mercury distributed and
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`sold in California, and the act of receiving royalties from
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`Mercury constitute purposeful availment under the "stream of
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`commerce" idea discussed in Asahi. Defendants, on the other
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`hand, contend chat under Asahi, FGG did not even place goods into
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`the "stream of commerce" because it simply granted rights in
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`recordings to Mercury, which then used those recordings. They
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`No. 652490/16
`Page 8 of 26
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`further assert that just placing a product into the stream of
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`commerce is not enough under Asahi. This Court agrees.
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`According to the plurality of the Supreme Court,
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`ac::c~s such as FGG's - "[tlhe placement of a product into the
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`stream of commerce, without more" - do not constitute "purposeful
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`availment" creating personal jurisdiction. Asahi Metal Ind. Co.
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`Sllpprior Court, 480 U.S. 102, 108 (1987); s.e..e. Omeluk v.
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`Langsten Slip & Batbygged A/s. 52 F.3d 267, 271 (9th Cir. 1995)
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`(where the Ninth Circuit followed the plurality opinion in
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`This Court finds that Plaintiffs have not shown that FGG
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`d~d anything more than place a product into the scream of
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`commerce . Plaintiffs' "evidence" supporting jurisdiction over
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`FGG is best summed up by their own statement: "Pursuant to the
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`li=e~se from FGG, defendant Polygram has manufactured recordings
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`of 9~al~tlffs' songs which are sold throughout the United States,
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`in=~~ding the State of California."
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`(Plaintiffs' Opposition, p.
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`4.) Without evidence that FGG did more than simply grant
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`licensing rights to, and receive royalties from, Mercury or
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`Polygram, a "stream of commerce" jurisdictional analysis is
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`In.ap9licable.
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`In an analogous situation, the court in Bib Mfg.
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`CO. Y. Dover Mfg. Co., which followed the directive of Asahi,
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`stated that "the forum activities of a licensee cannot support
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`the assertion of jurisdiction over a nonresiden.t patentee, even
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`if the patentee receives royalty payments."
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`804 2. Supp. 1129,
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`(E . D. Mo. 19 92) . Similarly, Defendants cite to Advanced
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`26~ Cardiovascular Sys .. v rnc. Y. Medtronic. Inc. wherein the court
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`Eddie Sitt v. Ralph Sitt, et al.
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`No. 652490/16
`Page 9 of 26
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`1 held that a licensee's forum activities are not sufficient to
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`support the exercise of in personam jurisdiction over a non-
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`resident patentee, even when the patentee receives royalty
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`4 payments.
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`1996 WL 467293, at *7
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`(N.D. Cal. July 24, 1996). The
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`5 court held that without evidence that the defendant actually
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`retained some control over distribution or marketing of the
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`7 patent, a "stream of commerce jurisdictional analysis is
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`inappropriate."
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`l..d. This Court finds this reasoning to be
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`9 persuasive and applicable to this situation.
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`Plaintiffs assert that the notation "A Feldman-
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`11 Goldstein-Gottehrer Production" on "The Angels" recordings and a
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`1964 advertisement by Mercury referring to and thanking FGG
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`confirm that FGG was actively involved in the recording and
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`14 production of Plaintiffs' songs, which were sold throughout the
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`15 U.S., including California. These assertions, without more, are
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`insufficient.
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`FGG states that it had no control over the
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`17 advertisement developed by Mercury. Gotteherer Decl. ~~ 5-6.
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`18 Moreover, local advertising alone is not enough to subject a
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`19 nonresident defendant to the jurisdiction of this Court. Forsyth
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`20 v. Overmyer, 576 F.2d 779, 783 (9th Cir. 1978).
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`In addition,
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`2~ FGG's involvement in production of the master-recordings occurred
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`In ~ew York, over thirty years ago. Gotteherer Decl. at ~ 4.
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`It
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`lS not enough to subject a non-resident defendant to the forum
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`24 state's jurisdiction merely because the plaintiff resides in the
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`forum state and may feel effects there. Casualty Assurance Risk
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`26 Tns. Brokerage v. Dillon, 976 F.2d 596, 600-01 (9th Cir. 1992).
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`Page 10 of 26
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`In sum, this Court finds that the notation "A Feldman-
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`Goldstein-Gottehrer Production" does not establish that FGG was
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`actively involved in the recording and production of Plaintiffs'
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`song.
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`In addition, the advertisement referring to and thanking
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`FGG, which FGG had no control over, does not establish that FGG
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`was involved in the marketing, distribution, or sales of "The
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`Angels" recordings. As such, this Court finds that Plaintiffs
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`have not established that FGG purposefully availed itself of they
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`privilege of conducting business in this forum.
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`2. Plaintiffs' claims do not arise out of FGG's
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`forum-related actiyities
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`This Court finds that Plaintiffs' claims do not arise
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`cut
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`FGG's forum-related activities. Plaintiffs entered into
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`the contracts in New York.
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`It is clear from Plaintiffs'
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`following assertion how attenuated FGG's activities are with this
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`rorum: "But for FGG's production and licensing of plaintiffs'
`171 sou~d recordings to its cc-defendants, which, in turn,
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`181 manufactured, sold and distributed recordings of plaintiffs'
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`19ij songs, plaintiffs would not have been entitled to royalties,
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`20 would have been deprived of royalties due to them, and would not
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`21
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`have had their trademark infringed."
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`(Opposlcion, p.10.)
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`Clearly, there are no activities by FGG in California which give
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`rise to Plaintiffs' claims.
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`3.
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`Exercise of personal jurisdiction oyer FGG would
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`offend fair play and substantial justice
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`No. 652490/16
`Page 11 of 26
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`Where a defendant has purposefully directed his
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`activities at the forum state, the defendant has the burden to
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`present compelling evidence that the forum's exercise of
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`jurisdiction would not comport with fair play and substantial
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`justice. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477-78
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`(1985); Amoco Egypt Oil, 1 F.3d 848, 851 (9th Cir. 1993). As set
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`forth above, this Court finds that FGG has not purposefully
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`directed its activities at this state. However, even assuming
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`that it did, this Court :inds that exercise of jurisdiction would
`
`not comport with fair play and substantial justice.
`
`The Core-Vent court identified seven factors that
`
`should be used to determine whether jurisdiction is reasonable:
`
`the extent of the defendant's purposeful interjection into
`
`the forum state's affairs; (2)
`
`the burden on the defendant of
`
`defending in the forum;
`
`(3) the extent of conflict with the
`
`sovereignty of the defendant's state; (4)
`
`the forum state's
`
`interest in adjudicating the dispute;
`
`(5)
`
`the most efficient
`
`judicial resolution of the controversy;
`
`(6)
`
`the importance of the
`
`fcrum to the plaintiff's interest in convenient and effective
`
`relief; and (7)
`
`the existence of an alternative forum. Core-
`
`~, 11 F.3d at 1487.
`
`First, as set forth above, the extent of Defendants'
`
`purposeful interjection into this state is practically non-
`
`existent. Second, it would be a burden on FGG, a New York
`
`corporation with its principle place of business in New York, to
`
`defend in this forum. Third, California does not have a strong
`
`27/
`i
`281 I
`
`11
`
`Eddie Sitt v. Ralph Sitt, et al.
`
`No. 652490/16
`Page 12 of 26
`
`

`

`interest in this action. The contracts were executed in New York
`
`and are guided by New York law; although Brown and Sirico are now
`
`California residents, they were residents of New Jersey at the
`
`ti~e they entered into the Sabina Contract; Davison is a Maryland
`
`resi·der;.t. Finally, an alternative forum exists - New York.
`
`In
`
`fact, it appears to this Court that New York would be a more
`
`appropriate forum.
`
`Accordingly, in light of the foregoing this Court
`
`grants Defendant's Motion to Dismiss FGG for Lack of Personal
`
`Jurisdiction.
`
`III. New York Law Goyerns Plaintiffs' Claims
`
`Both parties concede that New York law should apply to
`
`all of Plaintiffs' contract claims. 2 However, Defendants claim
`
`that New York law should apply to the remaining non-contract
`
`cla~~s while Plaintiffs dispute the application of New York law
`l611 to its non-contract claims and contend that California law should
`II
`be appiied.
`17)
`
`In determining what applicable law should be determined
`
`by the choice of law provision, this Court applies the choice of
`
`:aw rules of California, the forum state for this action .
`
`;1"'-;;'-;:;: Slgnal v. MC T T,::.lecommunications Corp., 66 F.3d 1500,
`
`1505 (9th Cir. 1995). Cal i fornia law broadly construes the type
`
`18 II
`19
`
`............
`L."<-.'
`
`11
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`
`23
`
`1
`
`2411
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`:1
`26 II
`!
`27i
`281 I
`
`Plaintiffs do not contest Defendants' argument that
`Plaintiff Davison should be bound to the choice-of-law clauses of
`the two contracts (even though she did not personally execute
`them) because she knowingly took advantage of the contracts and
`because her claims are thoroughly enmeshed in Brown and Sirico's
`contract claims.
`
`12
`
`Eddie Sitt v. Ralph Sitt, et al.
`
`No. 652490/16
`Page 13 of 26
`
`

`

`1 of contractual choice-of-Iaw provision at issue here. See id.
`
`2
`
`(court, referencing Nedlloyd Lines B.Y. y. Superior Court, 3 Cal.
`
`34th 459 (1992), held that the choice-of-Iaw provision providing
`
`4
`
`5
`
`6
`
`that the agreement "shall be interpreted, construed and governed
`
`by the laws of the State of New York" was sufficiently broad to
`
`cover non-contract claims). The choice of law provision in this
`
`7 case provides, "This agreement shall be governed by and construed
`
`8 under the laws of the State of New York."
`
`9
`
`Under California choice-of-Iaw rules, this Court must
`
`10
`
`apply the law designated by the contractual provision unless (1)
`
`11
`
`the chosen state has no substantial relationship to the parties
`
`12 or transaction; or (2) such application would run contrary to a
`l.d . . ,
`
`13 California public policy or evade a California statute.
`
`14 Sar1ot-Kanrarjian y. First Pennsylyanja Mortgage Trust, 599 F.2d
`
`15
`
`915, 917 (9th Cir. 1979); Gamer v. DuPont Glore Forgan. Inc., 65
`
`16 Cal.App.3d 280, 286 (1976). This Court finds that Plaintiffs
`
`17 have not shown that (1) New York has no substantial relationship
`
`18
`
`19
`
`co the parties or the transaction; or (2) application of the law
`
`of New York would be contrary to a California public policy or
`
`20
`
`statute.
`
`21
`
`22
`') -, II
`
`L_ J
`
`/1
`
`2411
`I
`25
`1
`I
`26!i
`'/
`2711
`2811
`
`Plaintiffs contend that California has ari interest in
`
`protecting its residents (Brown and Sirico) and an interest in
`
`offering a forum to obtain redress from torts committed against
`
`its residents.
`
`(Opposition at 19.) However, this Court agrees
`
`with Defendants that New York's interest in and connection to
`
`this dispute far outweighs California'S minimal interest.
`
`13
`
`Eddie Sitt v. Ralph Sitt, et al.
`
`No. 652490/16
`Page 14 of 26
`
`

`

`1 Although Brown and Sirico are now California residents, they were
`
`2
`
`residents of New Jersey at the time they entered the Sabina
`
`3 C::;nc:ract, which was executed in New York. Defendants are New
`
`4 York residents. Finally, as ~efendants contend, applying
`
`5 California law to Plaintiffs' claims, which stem from contracts
`
`entered into in New York with New York corporations, would allow
`
`aGd encourage forum shopping. See Zimmerman v. Allstate Ins.
`
`~, 179 Cal. App. 3d 840, 847 (1986)
`
`("[T]he only factor
`
`supporting plaintiff's claim of California governmental interest
`
`in this case is his status as a resident of this state until some
`
`mOGths following the [events leading to the lawsuit]. Were we to
`
`hold that the law of plai~tiff's residence applied, we would
`13 ~ encourage forum shopping. H)
`i!
`il ,
`=- 4 :1
`1 c: ;!
`-'-~ :1
`
`to the non-contract causes of action.
`
`Accordingly, this Court finds that New York law applies
`
`16 II
`: 7 il
`;!
`
`IV. Standard for a Motion to Dismiss
`
`In considering a motion to dismiss pursuant to Rule
`
`---.
`~
`_L.
`
`\
`
`h
`U
`
`, 0 ) of the Federal Rules of Civil Procedure, the court must
`.'- \
`
`assume that the plaintiff's allegations are true, and must
`
`construe the complaint in a light most favorable to the
`
`plaintiff. United States v. City of Redwood C~ty, 640 F.2d 963,
`
`'967
`
`:9th Cir. 1981). Mcre0ver, even if the face of the pleadings
`
`~ndicates that recovery is unlikely, the plaintiff is still
`
`entitled to offer evidence in support of the complaint. Scheuer
`
`v, Rhodes, 416 U.S. 232, 236 (:974); Rpdwood City, 640 F.2d at
`
`967. The court may not dismiss complaints pursuant to Rule
`
`14
`
`Eddie Sitt v. Ralph Sitt, et al.
`
`No. 652490/16
`Page 15 of 26
`
`

`

`12 (b) (6) "unless it appears beyond doubt that the plaintiff can
`
`prove no set of facts in support of his claim which would entitle
`::im to relief." Conley v. Gibson, 355 u.s. 41, 45-46 (1957) i
`
`Russell v. Landrieu, 621 F.2d 1037, 1039 (9th Cir. 1980).
`
`Generally, orders granting motions to dismiss are
`
`without prejudice unless "allegations of other facts consistent
`
`with the challenged pleading could not possibly cure the defect."
`
`Schreiber Dist. y. Sery-Well Furniture, 806 F.2d 1393, 1401 (9th
`
`·:ir. 1986).
`
`V.
`
`Dismissal of Plaintiffs' First. Second and Third Causes
`
`of Action for Trademark Infringement. False Designation
`
`and Description and Unfair Competition Is Warranted
`
`Defendants contend that Plaintiffs' trademark related
`
`causes of action -
`
`infringement of a registered trademark under
`
`Section 32 of the Lanham Act, 15 U.S.C. § 1114, false designation
`
`and description under Section 43(a) of the Lanham Act, 15 U.S.C.
`
`§ 1125(a) and unfair competition - fail to set forth claims for
`
`relief. They assert that dismissal is warranted because (1)
`
`:::e:endants have an express right to use the name "The Angelsi"
`
`2) Defendants have an implied right to use the name "The
`
`~: II
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`171
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`;1
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`
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`
`4...0 V
`
`:
`
`i
`211 Angels;" and (3) Defendants have lawfully sold genuine musical
`
`recordings made by plaintiffs under the name "The Angels." This
`
`Court finds that this latter argument is persuasive.
`
`Defendants contend that they have lawfully sold genuine
`
`musical recordings made by Plaintiffs as "The Angels" under the
`
`name "The Angels." Under these circumstances, Defendants assert
`
`15
`
`Eddie Sitt v. Ralph Sitt, et al.
`
`No. 652490/16
`Page 16 of 26
`
`

`

`Iii that there is no likelihood of confusion and therefore the
`I
`I
`21
`i
`1 3 :i
`Plaintiffs admit t~at Defendants are selling genuine
`.I
`4~ musical recordings made by Plaintiffs as recordings of uThe
`Ii
`:J II Ange 1 s . "
`iI
`r!\'
`o i(
`.: S
`
`trademark-related claims fail as a matter of law.
`
`However, they contend that Defendants' legal conclusion
`
`It
`L au..i,. y. They claim that their trademark-related claims are
`t:
`
`I 7 1 based on the fact that Defendants have used Plaintiffs' trademark
`8i in a manner likely to cause confusion, to cause mistake, or to
`1
`I
`
`deceive the general public as to whether Plaintiffs have
`
`sponsored or approved of Defendants' products and commercial
`
`activities.
`
`This Court finds t~at the applicable law bars
`
`Plaintiffs' trademark-~elated claims.
`
`"Trademark law generally
`
`does not reach the sale of genuine goods bearing a true mark even
`
`though such sale is without the mark owner's consent." NEe
`
`Electronjcs v. Cal Circuit ABCQ, 810 F.2d 1506, 1509 (9th Cir.
`
`1987). This principle is known as the "first sale" rule: the
`
`18~ right of a producer to control distribution of its trademarked
`'9~ p~oduct does not extend beyond the first sale of the product.
`:/
`20\ Sebas~;an Tntern y. Longs Drug Stores, 53 F.3d 1073, 1074-75 (9th
`:1
`~~ 1/
`9~r)
`--.'
`'-. l r. 1 ~ :J •
`'i
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`d
`221 ordinarily may resell the product unde~ the original mark without
`
`"Once a trademark owner sells his product, the buyer
`
`incurring any trademark law liability." Ne, Eles:"'ronirs, 810
`
`241 F.2d at 1509. The reason behind this principle is that trademark
`
`law is designed to prevent sellers
`
`confusing or deceiving
`
`consumers about the origin or make of a product, which confusion
`
`16
`
`Eddie Sitt v. Ralph Sitt, et al.
`
`No. 652490/16
`Page 17 of 26
`
`

`

`ordinarily does not exist when a genuine article bearing a true
`
`mark is sold.
`
`l.d.;.s..ae. McCoy v. Mitsuboshj Cutlery, Inc., 67
`
`F.3d 917, 923 ("Liability for unfair competition and trademark
`
`infringement depends on the likelihood of confusion.") .
`
`Here, Plaintiffs do not dispute that Defendants are
`
`101
`1
`
`Rather, Plaintiffs assert that Defendants are deceiving the
`
`public that plaintiffs have sponsored or approved of Defendants'
`
`activities. Plaintiff cites to cases for its proposition that
`
`the public's belief that the mark's owner sponsored or otherwise
`
`approved the use of the trademark satisfies the confusion
`
`requirement. However, those cases do not deal with genuine
`
`products and marks.
`
`In Dallas Cowboys. Etc. y. Pussycat Cinema.
`
`~, 604 F.2d 200 (1979), the court held that a likelihood of
`
`confusion was sufficiently established to entitle plaintiff's
`
`c~eerleading group to a preliminary injunction prohibiting
`
`defendants from distributing or exhibiting a motion picture film
`
`'
`
`['
`
`featuring a uniform strikingly similar to one worn by plaintiff's
`
`I
`I
`
`cheerleading group where it was hard to believe that anyone who
`
`had seen the film could ever thereafter disassociate it from
`
`2::' l'
`
`plaintiff's cheerle~ders, and association resulted in confusion
`
`61 selling Plaintiffs' genuine recordings bearing a true mark.
`i
`71
`811
`9 1
`I
`111
`1 ~ i
`~.:: II
`I
`, 3 :
`i
`J..
`141
`I
`, c; I
`1.-'i
`16/1
`1 .,11
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`, 8 i
`1.
`191
`I
`20i
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`
`which had a tendency to impugn plaintiff's services and injure
`
`plaintiff's business reputation. The court in Dallas Cowboys
`
`2 -:;
`
`~ l'
`
`24 ~
`I
`
`clearly was not dealing with the use of genuine products and
`
`marks. Similarly, in Anheuser-Busch. Inc. y. Balducci
`
`Publications, 28 F.3d 769 (9th Cir. 1994), cited by Plaintiffs,
`
`251
`
`26
`
`1
`27/
`
`281
`
`i
`
`17
`
`Eddie Sitt v. Ralph Sitt, et al.
`
`No. 652490/16
`Page 18 of 26
`
`

`

`the court held that likelihood of confusion existed between
`
`defendant's parody and plaintiff's trademarks "Michelob" and "A &
`
`~agle Design." There was no contention that the defendants used
`
`genuine products and marks.
`
`The Ninth Circuit case of Sebastian Intern. v. Long
`
`'I
`7 11
`, !I
`il
`
`Jrug Stor=s addresses Plaintiffs'
`
`argument directly.
`
`In
`
`Sebastian, the plaintiff asserted the same argument -
`
`that
`
`iefendant's reselling of plaintiff's products confused consumers
`
`i~to believing that there was some type of affiliation between
`
`defendant and plaintiff or approval by defendant. The Ninth
`
`Circuit called this premise "false":
`
`The
`
`'first sale' rule is not rendered
`
`inapplicable nerely because consumers
`
`erroneously believe the reseller 1S
`
`affiliated with or authorized by the
`
`producer.
`
`It is the essence of the 'first
`
`sale' doctiine that a purchaser who does no
`
`more than stock, display, and resell a
`
`producer's product under the producer's
`
`trademark violates no right conferred upon
`
`the producer by the Lanham Act. When a
`
`purchaser resells a trademarked article under
`
`the producer's trademark, and nothing more,
`
`there is no actionable misrepresentation
`
`under the statute.
`
`18
`
`Eddie Sitt v. Ralph Sitt, et al.
`
`No. 652490/16
`Page 19 of 26
`
`

`

`4 II
`,..
`II
`!I
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`II
`
`~ 1/ o il
`71
`I
`Qi
`~ II
`9 11
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`
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`13 II
`14 11
`
`dismiss Plaintiffs' first, second and third causes of action for
`
`infringement of a registered trademark under 15 U.S.C. § 1114,
`
`false designation under 15 U.S.C. § 1125(a) and unfair
`
`competition with prejudice and without leave to amend.
`
`VI. This Court Does Not Need to Address Dismissal of
`
`Plaintiffs' Causes of Action for Fraud and Rescission
`
`Defendants contend that Plaintiffs' cause of action for
`
`fraud against FGG fails under New York law because it merely
`
`restates their claim for breach of contract. They also contend
`
`that Plaintiffs have failed to plead the causes of action against
`
`FGG for fraud and rescission with sufficient particularity.
`
`In
`
`1
`
`I
`
`i
`i
`
`I Ld. at 1076. As such, since Defendants are selling genuine
`~I
`2! products with true marks, Plaintiffs cannot state claims for
`! 3i trademark infringement and unfair competition.
`Accordingly,. this Court grants Defendants' motion to
`
`:5- II
`~ II
`161 light of this Court's finding, supra, that no personal
`I
`171