Justia U.S. 2nd Circuit Court of Appeals Opinion Summaries

Plaintiff filed suit alleging that two shoe lines manufactured by defendant infringed plaintiff's trademark. At issue was whether a trademark registrant's delivery of a covenant not to sue, and voluntary dismissal of its trademark claims, divested a federal court of subject matter jurisdiction over a defendant's counterclaims for a declaratory judgment and cancellation of the trademark's registration. After considering the breadth of plaintiff's covenant not to sue and the improbability of future infringement, the district court dismissed defendant's counterclaims because no case or controversy existed under Article III of the United States Constitution. The court agreed with the district court and affirmed the judgment.

This appeal stemmed from numerous trademark and unfair competition claims over the name "Patsy's." Patsy's Italian Restaurant appealed, and Patsy's Pizzeria cross-appealed, from a judgment of the district court after a jury trial on claims brought pursuant to trademark and unfair competition law. The court upheld the district court's jury instructions; affirmed the district court's refusal to grant a new trial on the issue of whether Patsy's Pizzeria made fraudulent statements to the Patent and Trademark Office, as well as its refusal to vacate the jury's verdict that Patsy's Italian Restaurant did not fraudulently obtain its trademark registrations; affirmed the district court's refusal to reinstate Patsy's Pizzeria's trademark registrations; and upheld the district court's denial of attorneys' fees and injunctive relief. Accordingly, the court affirmed the judgment of the district court.

Plaintiff sued defendant, claiming, among other things, copyright infringement under 17 U.S.C. 501, trademark infringement under 15 U.S.C. 1114(a), and unfair competition under New York state law. At issue was whether the first sale doctrine, 17 U.S.C. 109(a), applied to copyrighted workers produced outside the United States but imported and resold in the United States. The court held that the first sale doctrine did not apply to works manufactured outside of the United States; the district court did not err in declining to instruct the jury regarding the unsettled state of the first sale doctrine; and the district court did not err in admitting evidence of defendant's gross revenues. Accordingly, the judgment of the district court was affirmed.

After a bench trial, the district court entered a judgment for plaintiffs concluding that on seventeen occasions, defendant had infringed plaintiffs' copyrights in their research reports, and that by collecting and disseminating to its own subscribers the summary recommendations with respect to securities trading contained in plaintiffs' reports, defendant had committed the New York state law tort of "hot news" misappropriation. Defendant appealed the judgment and injunction against it on the "hot news" misappropriation claim. The court held that plaintiffs' claim against defendant for "hot news" misappropriation of the plaintiff financial firms' recommendations to clients and prospective clients as to trading in corporate securities was preempted by federal copyright law. Based upon principles explained and applied in National Basketball Association v. Motorola ("NBA"), the court held that because plaintiffs' claim fell within the "general scope" of copyright, 17 U.S.C. 106, and involved the type of works protected by the Copyright Act, 17 U.S.C. 102 and 103, and because defendant's acts at issue did not meet the exceptions for a "hot news" misappropriation claim as recognized by NBA, the claim was preempted. Accordingly, the court reversed the judgment of the district court with respect to that claim.