A.V.E.L.A., INC. v. Estate of Marilyn Monroe, LLC

131 F. Supp. 3d 196, 2015 U.S. Dist. LEXIS 125149, 2015 WL 5507147
CourtDistrict Court, S.D. New York
DecidedSeptember 18, 2015
DocketNo. 12 Civ. 4828(KPF)
StatusPublished
Cited by49 cases

This text of 131 F. Supp. 3d 196 (A.V.E.L.A., INC. v. Estate of Marilyn Monroe, LLC) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
A.V.E.L.A., INC. v. Estate of Marilyn Monroe, LLC, 131 F. Supp. 3d 196, 2015 U.S. Dist. LEXIS 125149, 2015 WL 5507147 (S.D.N.Y. 2015).

Opinion

OPINION AND ORDER

KATHERINE POLK FAILLA, District Judge:

This litigation is but another skirmish in a long-running war over the intellectual property rights inhering in deceased celebrities — here, Marilyn Monroe. Plaintiff A.V.E.L.A., Inc. (“AVELA”) preemptively filed a complaint against the Estate of Marilyn Monroe, LLC (the “Monroe Estate”) and its licensee, Bioworld Merchandising, Inc. (“Bioworld”), seeking a declaratory judgment concerning federal and state intellectual property rights in Ms. Monroe. AVELA also asserted a claim against the Monroe Estate and Bioworld for tortious interference with a contract.

In response to the AVELA complaint, the Monroe Estate and Bioworld filed counterclaims against AVELA and third-party claims against Leo Valencia, AVE-LA’s purported owner. Thereafter, upon obtaining leave from the Court, the Monroe Estate filed the First Amended Counterclaim against AVELA and Valencia, as well as other reputed Valencia entities IPL, Inc. (“IPL”), X One X Movie Archives Inc. (“X One X”), and V. International Fine Arts Publishing, Inc, (“V. International”) (with AVELA and Valencia, the “Counter-Defendants”). The First Amended Counterclaim alleges seven causes of action, including: (i), false association and unfair competition in violation of 15 U.S.C. § 1125(a); (ii) trademark infringement in violation of 15 U.S.C. § 1114; (iii) trademark dilution in violation of 15 U.S.C. § 1125(c) and New York General Business Law § 360 — Z; (iv) common law unfair competition; (v) deceptive business practices proscribed by New York General Business Law § 349; (vi) tortious interference With existing contractual relationships; and (vii) intentional interference with prospective economic advantage.

Counter-Defendants X One X and V. International (collectively, the “Movants”) have moved to dismiss all seven causes of action against them in the First Amended Counterclaim. In addition, V. International has moved to dismiss any claim of liability premised on the theory that it was an alter ego of Valencia and/or AVELA. For the reasons set forth in this Opinion, the motions to dismiss are granted with respect to the Monroe Estate’s deceptive business practices cause of,action. Further, any claim for alter-ego liability against V. International is dismissed. The motions are denied in all other respects.

BACKGROUND1

A. Factual Background

1. Marilyri Monroe and the Monroe Estate

Marilyn Monroe was an actress, singer, and model who remains an enduring [201]*201American cultural icon more than 50 years after her death; indeed, it is a measure of her continuing fame that the Court could have dispensed with this description. (FAC ¶ 12). The Monroe Estate is a brand development and licensing company that maintains an exclusive portfolio of intellectual property rights related to Monroe. (Id. at ¶ 13). Specifically, the Monroe Estate owns a number of federal trademark registrations that are purportedly valid and subsisting in full force incorporating the words “Marilyn” or “Marilyn Monroe.” (Id. at ¶¶ 16-17). The U.S. Trademark Registration Numbers for these marks are 1,509,758 (the “'758 Mark”), 1,889,730 (the “'730 Mark”), 2,180,950 (the “'950 Mark”), 2,223,599 (the “'599 Mark”), 2,985,935 (the “'935 Mark”), 4,040,943 (the “'943 Mark”), 4,419,275 (the “'275 Mark”), and 4,336,364 (the “'364 Mark”). (Id. at ¶-16). According to the Monroe • Estate, the '758, '730, '950, and '599 Marks have been registered for a sufficiently long period of time to have become statutorily incontestable (collectively the “Incontestable Marks”). (Id. at ¶ 17).

Aside from, the registered marks, the Monroe Estate has applied for a number of trademarks and service marks incorporating the words “Marilyn Monroe” or the design of a lip print. (FAC ¶ 16). The Monroe Estate also claims substantial common law rights in the “Marilyn,” “Marilyn Monroe,” and lip print design marks (together with the registered marks, the “MONROE Marks”). (Id.). Separately, the Monroe Estate asserts that it is “the exclusive owner of those rights in and-to Marilyn. Monroe’s identity, persona, name and likeness arising under common law and/or statute[.]” (Id. at ¶ 18).2 The First Amended Counterclaim collectively refers to the MONROE Marks and the Monroe Estate’s interests in Monroe’s identity, persona, name, and likeness as the “Marilyn Monroe Intellectual Property,” a convention the Court adopts for purposes of this Opinion.

The Monroe’Estate alleges that, along with its predecessors, it has invested substantial efforts in acquiring, enforcing, promoting, and advertising the Marilyn Monroe Intellectual Property. (FAC ¶ 19). It further alleges that these efforts have borne success: As a result of Monroe’s celebrity status, ’ the significant sales of licensed products,.and substantial publicity, it is alleged that the Marilyn Monroe Intellectual Property is not only famous, but, also highly distinctive throughout the United States. (Id. at ¶ 21). This distinctiveness is evidenced by the secondary meaning that the Marilyn Monroe Intellectual Property has achieved in the marketplace. (Id. at ¶ 19).

For decades, the Monroe Estate, along with its predecessors, has monetized its interests in the Marilyn Monroe Intellectual Property by licensing these rights to third parties for use in connection with various goods and services. (FAC ¶ 20). The licenses extend to products like clothing, accessories, perfume, posters, wine, collectibles, and other novelty items. (Id.).

2. The Counter-Defendants a. Valencia, AVELA, IPL, and X One X

Leo Valencia is in the business of licensing images and other indicia of celebrities, including Marilyn Monroe, to entities for use in connection with merchandise such as apparel and glassware. (FAC ¶ 22). [202]*202Valencia purportedly conducts business through a collection of entities, including AVELA, IPL, and X One X. (Id. at ¶¶ 23-24). The Monroe Estate claims that these companies are alter egos of Valencia, rather than truly independent businesses. (Id. at ¶ 24). In support of this contention, the Monroe Estate asserts not only that AVE-LA, IPL, and X One X are undercapitalized, but also that Valencia is their sole shareholder, director, and employee. (Id. at ¶ 25). Valencia also purportedly disregards corporate formalities with respect to AVELA, IPL, and X One X by, for example, failing to maintain separate books and records for each company. (Id. at ¶26). Instead, Valencia blends the records of various entities on á single computer and utilizes a single cell phone to operate his businesses. (Id.).' Corporate' formalities' are further disregarded as the assets of AVELA, IPL, X One X, and Valencia are freely comingled. (Id. at ¶ 27). Ultimately, the Monroe Estate alleges that AVE-LA, IPL, and X One X are sham companies designed to dissipate any liability that Valencia incurs in connection with his licensing operations. (Id. at ¶¶ 23-24).

b. V. International

According to the First Amended Counterclaim, V.

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Bluebook (online)
131 F. Supp. 3d 196, 2015 U.S. Dist. LEXIS 125149, 2015 WL 5507147, Counsel Stack Legal Research, https://law.counselstack.com/opinion/avela-inc-v-estate-of-marilyn-monroe-llc-nysd-2015.