Property, intangible

a blog about ownership of intellectual property rights and its licensing

It’s Best If the Registrant Files the Lawsuit

This is something that I probably shouldn’t have to blog about, but here we are.

Plaintiff Palm Beach Concours LLC filed a complaint against defendant SuperCar Week, Inc. for: Count I, trademark infringement in violation of 15 U.S.C. § 1114 (infringement of a registered trademark); Count II for unfair competition in violation of 15 U.S.C. § 1125(a)(federal unfair competition); Count III for Florida common law trademark infringement; and Count IV for Florida common law unfair competition.1

I have no idea what either party does or what the alleged infringement was—the opinion didn’t get that far. SuperCar filed a motion to dismiss under Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction and under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted. What’s the problem?

Palm Beach Concours hadn’t suffiently alleged ownership of a trademark. There was a state trademark registration, but spot the problem:2

Palm Beach Concours FL trademark registration

The record owner is Sidney Vallon, the co-owner (with his wife) of Palm Beach Concours, but the trademark is not registered by Palm Beach Concours itself. As explained by the magistrate judge, “If Plaintiff is not the owner of the Mark, it has not suffered a constitutionally-sufficient injury-in-fact, even if Defendants are infringing on the Mark.” The court dismissed the complaint under Rule 12(b)(1) and declined to exercise supplemental jurisdiction over the state law claims.

A further problem was that Count I was for infringement of a federally registered mark and the plaintiff did not claim to own a federally registered mark. Count I was thus also dismissed for failure to state a claim.

Palm Beach Concours asked that Vallon be joined as a real-party-in-interest under Fed. R. Civ. P. 17(a)(3), but no go:

On the current record, the Court cannot exercise any judicial power other than to dismiss the case without prejudice. That means the Court cannot allow joinder under Rule 17(a)(3). Plaintiff’s remedy is to file a separate motion for leave to file an Amended Complaint that cures the jurisdictional defect. See SDFL Local Rule 15.1.

And a practice note: the court also dismissed the complaint as “an improper shotgun pleading” because

Counts II, III, and IV each incorporate all prior counts by reference. Weiland v. Palm Beach Cnty. Sheriff’s Office, 792 F.3d 1313, 1321 (11th Cir. 2015) (“The most common type [of shotgun pleading] – by a long shot – is a complaint containing multiple counts where each count adopts the allegations of all preceding counts, causing each successive count to carry all that came before and the last count to be a combination of the entire complaint.”). A court confronted with a shotgun pleading should sua sponte require repleading. Id. at 1321 n.10.

Yikes. The complaint was only ten pages with only four counts, all of them essentially for trademark infringement. Perhaps it was meant as a lesson, since the plaintiff’s lawyers didn’t appear to have done their homework on the elements of the various claims.

But let’s pause for a moment. The plaintiff perhaps could have stated a claim for federal unfair competition. A claim can be brought under § 43(a) (the basis for Count II) by anyone “who believes that he or she is or is likely to be damaged by such act,” which might include the licensee. J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition § 32:12 (5th ed. Dec. 2022 update). So it may be possible to allege that Palm Beach Concours was a licensee that was harmed, but the complaint didn’t. Even if alleged, it’s likely that the owner would have to be joined as a necessary party, but it saves the filing date.

This was the magistrate’s report and recommendation and the parties have until January 13, 2023 to file objections.

Palm Beach Concours, LLC v. SuperCar Week, Inc., Civ. No. 22-80888-CV-DMM (Dec. 30, 2022)(report and recommendation)

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  1. No idea why they didn’t allege infringement of a state registered trademark under Fla. Stat. § 495.131
  2. And no, it’s not “incontestable.” Complaint § 12. That’s a federal concept not used in the Florida trademark statute. 
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