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IP/Entertainment Case Law Updates

United Artists Corporation v. United Artist Studios LLC

District court grants preliminary injunction to United Artists in trademark infringement action, enjoining defendant film companies from operating under names “United Artist Studios” and “United Artist Film Festival.”

Plaintiff United Artists Corporation, a subsidiary of Metro-Goldwyn-Mayer Studios, commenced an action against defendant film companies United Artist Studios, United Artist Film Festival and others for trademark infringement, false designation of origin, trademark dilution and cyberpiracy under the Lanham Act, as well as common-law trademark infringement, violations of the statutory California Unfair Competition Law and common-law unfair competition under California state law. United Artists moved for a preliminary injunction seeking to enjoin defendants from using any of its Class 9, 16 and 41 trademarks; operating with “United Artist” in their names; and falsely implying United Artists’ approval, endorsement or sponsorship of defendants’ business. Defendants separately moved to dismiss United Artists’ claims on various grounds, including on the basis that its use of the marks constituted classic or nominative fair use. The court granted United Artists’ motion for a preliminary injunction and denied defendants’ motion to dismiss.

In granting United Artists’ preliminary injunction motion, the court found that each of the preliminary injunction factors weighed in favor of a preliminary injunction—likelihood of success on the merits, irreparable harm, balance of hardship and the public interest.

The court focused its consideration of the first preliminary injunction factor on the Ninth Circuit’s Sleekcraft factors used in determining whether there was a likelihood of confusion among consumers with respect to the parties’ respective marks. In doing so, the court determined that the marks are “nearly identical,” explaining that defendants’ omission of the plural “s” and their use of additional words in conjunction with “United Artist” did not change the analysis. The court further determined that “the parties clearly offer services that are targeted to the same audience,” and that the “UNITED ARTISTS Marks are strong and, according to spectrum of distinctiveness, are at least suggestive” rather than purely descriptive of its goods and services. Notwithstanding the absence of any direct evidence of actual confusion at this early stage of the litigation, the court determined that United Artists had established a likelihood of confusion and, thus, a likelihood of success on the merits because “consumers are likely to be confused between the UNITED ARTISTS Marks and the UNITED ARTIST Marks.”

The court further held that United Artists had established that it was likely to be irreparably harmed by defendants’ use of its marks. Although “irreparable injury can no longer be presumed in trademark cases,” the court determined that United Artists had submitted sufficient evidence to support a finding of irreparable harm. Though United Artists had “not produced specific evidence that association with Defendant’s UNITED ARTIST Marks has been harmful to its reputation, it is enough at this early stage of litigation that Plaintiff has introduced evidence of loss of control over its own business reputation and quality control.” Among other things, United Artists showed that it has invested millions of dollars over a century in developing and promoting the UNITED ARTISTS marks, resulting in widely recognized commercial success, including movies that have grossed more than $5 billion. 

The court further ruled that the balance of hardships and the public interest weighed in favor of a preliminary injunction. Although defendants argued that it would be forced to shut down its businesses and “incur millions of dollars in losses,” it offered no evidence in support of this contention. On the other hand, United Artists submitted evidence showing that its reputation and goodwill in the motion picture production and distribution industries, developed over the course of a century, would be harmed without injunctive relief. The court also concluded that the likelihood of confusion among consumers established that the injunction was in the public interest.

In rejecting defendants’ motion to dismiss, the court disagreed that United Artists had failed to state a claim, including for the same reasons that it determined that United Artists had established a likelihood of confusion among consumers. The court rejected defendants’ arguments that their use of the UNITED ARTIST marks constituted classic or nominative fair use, because defendants failed to establish that they used their marks to describe plaintiff United Artists’ goods or services (nominative fair use), or in a primary descriptive sense to describe defendants’ own goods or services (classic fair use).

Summary prepared by Wook Hwang and Mary Jean Kim