Second Avenue Deli Can Keep INSTANT HEART ATTACK SANDWICH: SDNY | Practical Law

Second Avenue Deli Can Keep INSTANT HEART ATTACK SANDWICH: SDNY | Practical Law

On July 6, 2012 in Lebewohl v. Heart Attack Grill LLC the US District Court for the Southern District of New York held that a Manhattan deli's use of the mark INSTANT HEART ATTACK SANDWICH does not infringe a Las Vegas restaurant's registered HEART ATTACK GRILL trademark. The court also approved the parties' proposals for concurrent use of their HEART ATTACK marks and certain TRIPLE BYPASS marks finding that simultaneous use of the marks subject to various conditions would not cause consumer confusion.

Second Avenue Deli Can Keep INSTANT HEART ATTACK SANDWICH: SDNY

Practical Law Legal Update 5-520-2934 (Approx. 5 pages)

Second Avenue Deli Can Keep INSTANT HEART ATTACK SANDWICH: SDNY

by PLC Intellectual Property & Technology
Published on 10 Jul 2012 • USA (National/Federal)
On July 6, 2012 in Lebewohl v. Heart Attack Grill LLC the US District Court for the Southern District of New York held that a Manhattan deli's use of the mark INSTANT HEART ATTACK SANDWICH does not infringe a Las Vegas restaurant's registered HEART ATTACK GRILL trademark. The court also approved the parties' proposals for concurrent use of their HEART ATTACK marks and certain TRIPLE BYPASS marks finding that simultaneous use of the marks subject to various conditions would not cause consumer confusion.

Key Litigated Issues

The key litigated issues in Lebewohl v. Heart Attack Grill LLC were whether the Second Avenue Deli's (Deli) current or contemplated uses of the marks INSTANT HEART ATTACK SANDWICH or TRIPLE BYPASS SANDWICH violated Heart Attack Grill's (HAG) rights under the Lanham Act. The court examined the issue in light of HAG's concession at oral argument that Deli's use of each of the two marks, subject to certain specific limitations, would not create a likelihood of confusion.

Background

HAG operates a medically-themed restaurant in Las Vegas, Nevada. HAG serves large, high calorie hamburgers. Based on trademark applications filed beginning in June 2005 through December 2005, HAG obtained registrations in the US Patent and Trademark Office (USPTO) for the following marks among others:
  • HEART ATTACK GRILL.
  • TRIPLE BYPASS BURGER.
The Deli, established in 1954, is a kosher delicatessen with two locations in Manhattan. The Deli features an INSTANT HEART ATTACK SANDWICH on its menu which it began offering in 2004.
On September 29, 2010, the Deli filed with the USPTO:
  • A use-based trademark application for the INSTANT HEART ATTACK SANDWICH mark.
  • An intent-to-use trademark application for the mark TRIPLE BYPASS SANDWICH.
As of the date of the court's decision, the Deli has not offered a sandwich under the TRIPLE BYPASS SANDWICH mark.
On January 13, 2011, the USPTO preliminarily refused the Deli's application for the INSTANT HEART ATTACK SANDWICH mark based on a likelihood of confusion with HAG's HEART ATTACK GRILL mark. The USPTO also refused the Deli's application for the TRIPLE BYPASS SANDWICH mark concluding that it was likely to be confused with HAG's TRIPLE BYPASS BURGER mark.
On March 29, 2011, HAG sent a cease-and-desist letter to the Deli demanding the Deli refrain from using the INSTANT HEART ATTACK SANDWICH and TRIPLE BYPASS SANDWICH marks. On May 10, 2011, the Deli filed a declaratory judgment action seeking a ruling that:
  • Neither of the Deli's two trademarks infringe any of HAG's marks and that the Deli may register those marks.
  • Alternatively, if the court were to find a likelihood of confusion between the Deli's marks and HAG's marks, the Deli may exclusively use the INSTANT HEART ATTACK SANDWICH mark in New York, New Jersey, and Connecticut.
At oral argument on May 22, 2012, HAG conceded that Deli's use of the two marks, subject to specific restrictions, would not create a likelihood of confusion.

Outcome

Regarding the Deli's INSTANT HEART ATTACK SANDWICH mark, the US District Court for the Southern District of New York:
  • Granted the Deli's motion for summary judgment on its claim for a declaratory judgment that the Deli's current use of INSTANT HEART ATTACK SANDWICH does not infringe HAG's HEART ATTACK GRILL mark.
  • Entered an order setting conditions for the Deli's continued use of the mark in Manhattan.
  • Denied the Deli's request for a declaratory judgment that it may use the mark outside of Manhattan, including throughout New York, Connecticut and New Jersey, and that it may use the mark to the exclusion of HAG's mark.
Regarding the Deli's TRIPLE BYPASS SANDWICH mark, the court:
  • Granted the Deli's motion for a declaratory judgment that it may use that mark under a concurrent use order.
  • Granted HAG's motion to voluntarily dismiss its counterclaims against the Deli.
  • Denied both parties' requests for attorneys' fees.

The INSTANT HEART ATTACK SANDWICH Mark

In evaluating whether the Deli's INSTANT HEART ATTACK SANDWICH mark infringed HAG's HEART ATTACK GRILL mark, the court examined:
  • Whether the jurisdictional requirements of the Lanham Act were satisfied, assessing whether the INSTANT HEART ATTACK SANDWICH mark was used in commerce.
  • Whether the Deli's existing or expanded use of the mark would result in a likelihood of confusion between the marks.

Jurisdiction

The court determined that it had jurisdiction because the Deli had used INSTANT HEART ATTACK SANDWICH as a mark in commerce. The court, noting that the Supreme Court has broadly construed the Lanham Act's jurisdictional reach, found sufficient use in commerce because:
  • The Deli is in, and affects, interstate commerce as a celebrated New York City tourist attraction that serves numerous interstate travelers and it is readily accessible by interstate highways.
  • The Deli's clientele extends beyond New York state, as evidenced by national media coverage and the listing of the INSTANT HEART ATTACK SANDWICH product on menus available to out-of-state customers.
  • The Deli has spent hundreds of thousands of dollars purchasing ingredients transported from outside New York State for the contents of the INSTANT HEART ATTACK SANDWICH product.

Likelihood of Confusion

Although the USPTO primarily denied the Deli's trademark application for INSTANT HEART ATTACK SANDWICH based a finding oflikelihood of confusion with HAG's HEART ATTACK GRILL mark, the court concluded that there is no likelihood of confusion presented by the Deli's current use of the INSTANT HEART ATTACK SANDWICH mark. The Deli currently uses the mark by listing it on menus in the two Manhattan restaurants and listing the sandwich on the Deli's website menu.
In reaching its determination, the court balanced the Polaroid factors used in the US Court of Appeals for the Second Circuit to assess likelihood of confusion. The court found that most of the Polaroid factors weigh against confusion, particularly the factor of proximity of the products because the Deli and HAG do not presently compete in the same geographic market. Since an analysis of the Polaroid factors did not result in a finding of likelihood of confusion, the court granted the Deli's declaratory judgment that there was no infringement at the current time.

Potential for Future Confusion and Concurrent Use

The Deli also sought a declaration that expanded use of its INSTANT HEART ATTACK SANDWICH mark would not create a likelihood of consumer confusion, or, alternatively, if there is confusion a declaration that concurrent use is permissible. The Deli sought a specific declaration that it is entitled to exclusive use of the mark in New York, New Jersey and Connecticut. Before determining the possibility of dual use, the Deli had to first establish use of the mark before HAG filed its application to register its HEART ATTACK GRILL mark with the USPTO on June 9, 2005. The court held that the Deli's mark was in use before HAG filed its application to register its mark based on the following evidence:
  • A sworn declaration stating that the sandwich was created around 2004.
  • A menu dated 2004-2005 containing the name of the sandwich and an address for a Deli location that closed on January 1, 2006.
  • A May 19, 2004 Chowhound review and January 13, 2005 Chowhound message-board post that both reference the sandwich.
  • A July 2004 Korean Airlines newsletter referencing the sandwich.
Although the Deli met the threshold requirement for proving prior usage, the court declined to grant Deli exclusive use of its mark in New York, New Jersey and Connecticut. The court based this decision on two points:
  • HAG, as the senior registrant, has presumptive nationwide rights to the mark.
  • Granting exclusivity would be premature because the Deli admittedly has no current plans to expand outside Manhattan.
The court also declined to decide whether HAG could be excluded from entering into Manhattan, but noted that it was skeptical that any consumer confusion would arise.
The court adopted a narrower concurrent use order based on the parties' agreement at oral argument that more accurately reflects the parties' actual business needs. Under the concurrent use order:
  • The Deli may continue serving the INSTANT HEART ATTACK SANDWICH anywhere in Manhattan.
  • The Deli may continue advertising the sandwich on its in-restaurant menus, interior and exterior signs at Manhattan restaurants, and internet advertising the menu used in its Manhattan restaurants.

The TRIPLE BYPASS SANDWICH Mark

As of the date of the court decision, the Deli has not used the TRIPLE BYPASS SANDWICH mark. At oral argument, HAG acknowledged that there would be no likelihood of confusion between the Deli's TRIPLE BYPASS SANDWICH mark and HAG's TRIPLE BYPASS BURGER mark subject to certain restrictions on the Deli's use of TRIPLE BYPASS SANDWICH. The Deli accepted the proposed conditions. The court noted its independent duty to assess likelihood of confusion but was ultimately persuaded that the arrangement was fair and unlikely to lead to confusion.
Under the concurrent use order entered by the court, the parties agreed that:
  • The Deli may use its TRIPLE BYPASS SANDWICH mark at its current Manhattan locations, but only on its hard-copy and online menus.
  • The Deli may not use any images of the sandwich on either menu.
  • The Deli may not reference the TRIPLE BYPASS SANDWICH mark on the restaurant's exterior or interior signage.

Practical Implications

The case demonstrates the potential utility of concurrent use or coexistence arrangements for resolving trademark disputes where the use of the marks of one or both parties is subject to specific conditions designed to avoid a likelihood of consumer confusion. The court expressly noted that the arrangements ultimately entered into by the parties could have been considered up front as a means of avoiding costly and time-consuming litigation.

Court Documents