By George Basharis, J.D.
Mrs. United States National Pageant, Inc., failed to show that it would sustain irreparable harm unless the former director returned promotional materials bearing the organizer’s trademarks and other IP, including websites created under expired license agreements.
An organizer of beauty pageants could not establish that it was being irreparably harmed by a former director’s retention of the pageant’s websites, social media accounts, and marketing and other promotional material created by the director under trademark licenses, the district court in New York determined. The director removed all references to the pageant and other content from the websites and deactivated all social media accounts that were created under license to promote the pageants. Also, there was no evidence that the director was improperly using any licensed intellectual property or that the organizer could not be adequately compensated with money damages. Thus, an injunction compelling the director to refrain from using the organizer’s trademarks and to turn over intellectual property that was created under expired license agreements was denied (Mrs. United States National Pageant, Inc. v. Williams, February 14, 2019, Larimer, D.).
Mrs. United States National Pageant, Inc., organizes beauty pageants throughout the country using divisions that are separately trademarked. The director was granted a license by the organizer to use the trademarks to promote beauty pageants for the various divisions. The director’s promotional efforts under the license agreements involved creating websites and social media accounts.
The license agreements either expired or were terminated by the director. The obligations of the parties under the agreements and the ownership of intellectual property and materials created during the license period were disputed. The pageant organizer argued that the director was required to return or transfer to the pageant organizer the administrative rights for all of the websites and social media accounts created under license, all promotional and advertising material bearing the pageant’s trademarks, and contestant rolls. The pageant organizer maintained that it would be irreparably harmed by the director’s continued possession of these items.
A showing of irreparable harm requires a continuing harm that cannot be compensated by money damages. The director established the websites to recruit contestants and to promote the organizer’s pageants. Although the director maintained administrative control over the websites after the licenses expired or were terminated, she removed all content from them. Nonetheless, the organizer argued that for every day it was not in control of the websites, it lost prospective customers who would have paid to be beauty pageant contestants. This claim was "entirely speculative," the court found. The websites were not using the organizer’s trademarks nor were they equipped to divert potential contestants from the organizer’s official website, and any harm could be compensated with money damages.
Likewise, the organizer failed to demonstrate a likelihood of irreparable harm arising from director’s ownership or administration of social media accounts created during the license period. The director deactivated the accounts and removed from them all content related to the organizer’s pageants. The organizer could not show any harm other than the loss of "followers" and the "money, time and energy" required to create new social media accounts, which was not sufficient to show irreparable harm, according to the court.
The court also refused to compel the director to return all program materials, contestant rolls, and scoresheets from competitions held during the license period because there was no showing by the organizer that the director was using these materials improperly or that any potential harm could not be adequately compensated with money damages. Finally, the organizer claimed that statements by the director to state pageant officials tarnished its goodwill and required the expenditure of "significant resources" to remedy. However, the claims were based solely on the conclusory declarations of the director’s president and were insufficient to establish irreparable harm.
This case is No. 6:18-cv-06587-DGL-MWP.
Attorneys: Robert P. Yawman, III (Leclair Korona Cole LLP) for Mrs. United States National Pageant, Inc. Laura A. Myers (Wolford Law Firm LLP) for Stephanie L. Williams.
Companies: Mrs. United States National Pageant, Inc.
MainStory: TopStory Trademark NewYorkNews
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