The opinion of the court was delivered by: Juan R. Sanchez, J.
Plaintiffs Robert E. Warden and ReWarden, Inc. seek a preliminary injunction to prevent Defendants Pamela Senk Falk and Dynamic Housewares, Inc. (DHI) from (1) commercially using Bob Warden's name, (2) contacting Plaintiffs' business relations with the intent to interfere with Plaintiffs' business, (3) representing or insinuating that Defendants control Bob Warden's name or have the ability to do business under his name, (4) contacting QVC, Inc. television network (QVC) or other companies and asserting Defendants have the right to control Warden's appearances or that Warden is required to seek authorization from Defendants before writing or publishing cookbooks, and (5) engaging in other related activities.
Also as part of their motion for a preliminary injunction, Plaintiffs seek a declaration that Warden may appear on QVC without Defendants' approval and may introduce himself or be introduced as Bob Warden, and may write and identify himself as the author of new cookbooks. Next, Plaintiffs ask the Court to impose an equitable trust on $770,000 transferred by Falk from the DHI corporate account to her personal bank account, and to appoint a receiver to control DHI's business affairs and coordinate DHI's role in producing a cookbook with Warden. Plaintiffs further request this receiver be directed to conduct an accounting of DHI to determine all monies diverted to Falk's personal accounts and to determine the amount of funds due to Plaintiffs, if any, under prior contracts or a prior partnership relationship with DHI. Finally, Plaintiffs ask this Court to cancel DHI's registration of a "Bob Warden" trademark pursuant to 15 U.S.C. §§ 1064 and 1119. For the reasons that follow, this Court will grant in part and deny in part Plaintiffs' motion for a preliminary injunction.
Plaintiffs filed this action on April 27, 2011, bringing claims for, inter alia, fraudulent trademark registration, trademark infringement, unfair competition, tortious interference, fraud, and breach of contract. Plaintiffs also sought entry of a temporary restraining order (TRO) preventing Falk from interfering with Warden's appearances on and contracts with QVC, a multimedia retailer with which Warden has done business since 1987. Plaintiffs asserted such relief was immediately necessary because Falk informed QVC that she owned the rights to Warden's name, image, and likeness, and that he could not appear on television without her permission.*fn1 Following an April 27, 2011, conference, this Court denied Plaintiffs' request for a TRO but granted their motion for an expedited preliminary injunction hearing, scheduling the hearing for May 16, 2011. On May 13, 2011, the parties negotiated an interim settlement agreement (ISA) which they believed obviated the need for a preliminary injunction hearing. The parties dictated the terms of their agreement to a court reporter and informed the Court the preliminary injunction hearing was no longer necessary.
Pursuant to the ISA, DHI agreed to work with Plaintiffs to publish a
cookbook, "Slow Food Fast II," pursuant to a proposed cookbook
contract with QVC. The parties further agreed to "timely
execute any additional documents and undertake any additional action
necessary to effectuate the terms contained [within the ISA]." ISA Tr.
¶ 17, May 13, 2011. Plaintiffs' counsel forwarded a copy of the ISA to
QVC's counsel, Nathaniel Metz, and asked Metz to advise what
additional terms, if any, should be added to satisfy QVC and enable
the parties to proceed with production of Slow Food Fast II. Metz
edited the draft settlement agreement to include a provision granting
QVC an irrevocable license to use Bob Warden's name.*fn2
Defendants objected to the irrevocable license provision,
fearing such a license would dilute their claims to ownership of a Bob
Warden trademark, and refused to agree to QVC's proposed additional
Having again reached an impasse with Defendants, and fearing they would be unable to produce Slow Food Fast II in advance of an August 25, 2011, deadline, Plaintiffs sought this Court's intervention, asking this Court to enforce the ISA. This Court reviewed the ISA's terms and found that although Defendants agreed to timely execute "any additional documents" necessary to effectuate the ISA's terms, Defendants could not have reasonably anticipated that such additional documents would include the irrevocable license requested by QVC. Because this term of the ISA was not sufficiently definite to be enforceable against Defendants, this Court set aside the ISA and scheduled a preliminary injunction hearing for July 13, 2011. The hearing was held on July 13-15, 2011.
This case arises from the simultaneous dissolution of the business and romantic relationships between Warden and Falk. Warden is a television personality who has appeared on QVC since 1987 to sell cookbooks and cookware. In 2005, Warden met Falk and the two began an amorous relationship. Sometime thereafter, they decided to go into business together, with Warden providing his talent to the business venture by making appearances on QVC and elsewhere, and Falk handling the business side of the company by reviewing contracts, managing financial accounts, and keeping the company's books. The parties decided to incorporate a business and, to that end, enlisted the services of the law firm K&L Gates to form the new company, DHI. The circumstances surrounding the formation of the company and the final corporate form are hotly disputed. Falk asserts she is the sole owner, officer, and stockholder of DHI, contending Warden did not want to be listed as a company owner because of issues regarding unpaid taxes and his divorce proceedings, which were ongoing in 2006. Warden, in contrast, asserts he is a 50% owner of DHI, arguing he agreed to lend his talent and reputation to the business on the condition that he would receive half of the business's profits. This Court need not make factual findings regarding the ownership of DHI at this time. It is clear, however, that Warden has believed since 2006 that he is a 50% owner of DHI.
In late 2006, the parties also decided to register a "Bob Warden" trademark (the Mark) with the United States Patent and Trademark Office (USPTO), and sought the assistance of another K&L Gates attorney, Christine Redfield, to complete the trademark registration application. The parties agreed that DHI would register the Mark, but they dispute the extent of DHI's legal interest in the registration. Before submitting the application, Redfield advised Warden and Falk that, for DHI to own the Bob Warden name and trademark in connection with cookware, housewares, and cookbooks, Warden would have to "assign all rights, title and interest in his name to [DHI]." Redfield email, Nov. 10, 2006. She further advised:
If the application is to be filed in the name of [DHI] based on an oral license agreement from Bob to [DHI], we can go ahead and file the application now. However, if Bob decides to assign his name to [DHI], we should have an assignment agreement executed prior to filing the application.
Id.*fn4 Falk admits she did not receive an assignment of Warden's rights, title, goodwill, and/or interest in his name before the application was filed, and further concedes she has never received such an assignment. Instead, Falk testified that Warden refused to execute an assignment.
Nonetheless, three days after sending the email requesting an assignment, on November 13, 2006, Redfield submitted an application for trademark registration on behalf of DHI, which asserted DHI owned the Bob Warden trademark. The November 2006 application asserted that "Bob Warden" had been used as a trademark to promote the goods of others through infomercials, books, and personal appearances since at least December 31, 1986, and that "Bob Warden" had been used to sell cookware, including utensils, electric knives, food processors, electric mixers, other products, and cookbooks since at least December 31, 1993.
On March 31, 2007, the USPTO sent notification of an "Office Action" regarding registration of the Mark. This notification identified a number of deficiencies in the trademark application, including that the application did not specify whether "Bob Warden" identified a particular living individual.*fn5 The notice further required that, "[i]f the name in the mark identifies a particular living individual," DHI must submit "a signed, written consent from that individual, authorizing applicant to register the name as a trademark with the USPTO." Pl.'s Mot., Ex. 25. Thereafter, DHI obtained a consent form from Warden, dated May 14, 2007, stating "The undersigned Bob Warden, hereby consents to the use and registration as a trademark in the U.S. Patent and Trademark Office of his name by Dynamic Housewares, Inc." Pl.'s Mot., Ex. 31. Warden received no consideration from ...