Lobo Enterprises, Inc. v. Tunnel, Inc.

693 F. Supp. 71, 8 U.S.P.Q. 2d (BNA) 1764, 1988 U.S. Dist. LEXIS 9580, 1988 WL 90143
CourtDistrict Court, S.D. New York
DecidedAugust 29, 1988
Docket86 Civ. 9754 (MBM)
StatusPublished
Cited by14 cases

This text of 693 F. Supp. 71 (Lobo Enterprises, Inc. v. Tunnel, Inc.) 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
Lobo Enterprises, Inc. v. Tunnel, Inc., 693 F. Supp. 71, 8 U.S.P.Q. 2d (BNA) 1764, 1988 U.S. Dist. LEXIS 9580, 1988 WL 90143 (S.D.N.Y. 1988).

Opinion

MUKASEY, District Judge.

Plaintiff Lobo Enterprises, Inc. operates a small bar at 7th Street and First Avenue in Manhattan, called “Tunnel Bar,” that caters primarily if not exclusively to gay men. It seeks to enjoin 1 defendant Tunnel, Inc. under Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), from using “Tunnel” as the name of defendant’s nightclub and discotheque at 27th Street and Twelfth Avenue, also in Manhattan; defendant devotes one night per week to gay clientele. Judge Kevin T. Duffy denied a preliminary injunction initially on grounds of (i) lack of subject matter jurisdiction for failure to demonstrate effect on interstate commerce, and (ii) a finding that plaintiff’s “Tunnel Bar” catered only to “a distinct subset of the gay population interested in ‘leather.’ ” 652 F.Supp. 1037, 1044 n. 2 (S.D.N.Y.1987). The Court of Appeals reversed the jurisdictional determination and found also that the record would not support a conclusion that plaintiff’s bar attracted only those “interested in ‘leather.’ ” 822 F.2d 331, 334 (2d Cir.1987). However, neither was the record “so compelling as to indicate that the plaintiff must be granted a preliminary injunction,” id., and the case was remanded for further proceedings.

Following transfer of the case to my docket, the preliminary injunction hearing was combined with the trial on the merits pursuant to Rule 65(a)(2), Fed.R.Civ.P., by agreement of the parties, and the matter was heard on April 5 and April 15, 1988. After a review of the evidence at trial, including the exhibits and the testimony and demeanor of the witnesses, and an examination of the post-trial submissions of the parties, I conclude for the reasons set forth below that plaintiff has failed to prove “that an appreciable number of ordinarily prudent purchasers are likely to be misled, or indeed simply confused, as to the source" of the recreation offered at the two establishments. Mushroom Makers, Inc. v. R.G. Barry Corp., 580 F.2d 44, 47 (2d Cir.1978) (per curiam), cert. denied, 439 U.S. 1116, 99 S.Ct. 1022, 59 L.Ed.2d 75 (1979). Therefore, the injunction is denied and the complaint dismissed.

I.

Decisions in Lanham Act cases usually are highly fact-specific because such decisions require a “comprehensive analysis of all the relevant facts and circumstances,” Vitarroz Corp. v. Borden, Inc., 644 F.2d 960, 968 (2d Cir.1981), i.e., “all factors bearing on the likelihood of confusion,” as well as “balancing the conflicting interests of the parties involved.” McGregor-Doniger Inc. v. Drizzle Inc., 599 F.2d 1126, 1132, 1140 (2d Cir.1979). See also, Thompson Medical Co. v. Pfizer Inc., 753 F.2d 208, 214 (2d Cir.1985) (“[E]ach trademark infringement case presents its own unique *73 set of facts.”) Accordingly, although many of the facts relating to the parties’ businesses were established at the preliminary injunction hearing and were set forth in the Second Circuit’s earlier opinion in this case, 822 F.2d at 331-32, it is nonetheless useful to repeat them here, along with additional information developed at the trial before me.

A. Plaintiffs Business

Plaintiff’s bar opened in August 1984. Catering primarily to gay men, the “Tunnel Bar” occupies an 18 X 70 foot space that includes a 40-foot bar, and has a capacity of 125 patrons. Plaintiff’s “Tunnel Bar” charges from $2.50 to $4.25 for hard liquor drinks and sells beer for $1 per glass; it charges no admission fee. Prel. Inj. Tr. 67-68 It has no cabaret license, and therefore no dance floor, Prel. Inj. Tr. 73, although its ambience includes taped music. Prel. Inj. Tr. 17 The “Tunnel Bar” logo appears on the steel shutter that covers the front of the building it occupies: a crossed spade and pickaxe superimposed on a gear wheel.

Although plaintiff’s bar is listed in a variety of gay entertainment guides as featuring a “Levi and leather” or “Levi” or “cowboy” atmosphere, the evidence at trial does not support the conclusion that plaintiff caters exclusively or even primarily to any particular segment of the gay community so defined, 2 although as set forth below its atmosphere and appeal in other respects distinguish it in significant ways from defendant’s establishment. According to its manager, plaintiff’s bar offers parties both monthly and in more or less impromptu fashion around various events [e.g., birthdays) and themes {e.g., “Margarita Madness,” featuring discount drinks) so as to promote a club atmosphere (Prel. Inj. Tr. 40; Trial Tr. 93); one night a week it also offers erotic movies of interest to homosexual men. PI. Ex. 89

Plaintiff Lobo has advertised the “Tunnel Bar” with name, location and telephone number in several gay-oriented publications that circulate in the tri-state metropolitan area of New York, but has never listed the “Tunnel Bar” in the New York Telephone NYNEX white pages. Plaintiff’s manager explained at trial that plaintiff preferred not to list the name of the “Tunnel Bar” in a directory of general circulation so as to avoid harassing telephone calls and to make it more difficult for employees to receive personal telephone calls. Trial Tr. 39 Lobo did not file a Certificate of Conducting Business under an Assumed Name as required by N.Y. Gen. Bus. L. § 130(1) (McKinney 1988) until after it started this lawsuit.

B. Defendant’s Business

Defendant The Tunnel, Inc. began in the spring of 1986 to renovate at a cost of about $3 million a previously unused train tunnel at 27th Street and 12th Avenue. The renovations included installing a 2,000-square-foot dance floor and state-of-the-art sound and computerized lighting equipment that converted the 740-foot-long tunnel into a night club and discotheque. A trademark search indicated that the proposed name, “Tunnel,” was available and defendant has operated under that name at least since January 1987 when plaintiff’s application for a preliminary injunction was denied.

Defendant’s “Tunnel” can accommodate more than 2,000 patrons in its main room and an additional 400 in its basement. Defendant cultivates an image of glamor, and seeks to attract both those whose names appear on the entertainment and society pages, and those drawn by the presence of such people. Admission is by invitation and/or payment of an entrance fee that can run as high as $20 on weekends; liquor at one of the three bars in defendant’s “Tunnel” costs between $5 and $8 a drink, beer about $4.50. Prel. Inj. Tr. 186-87 Apart *74

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693 F. Supp. 71, 8 U.S.P.Q. 2d (BNA) 1764, 1988 U.S. Dist. LEXIS 9580, 1988 WL 90143, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lobo-enterprises-inc-v-tunnel-inc-nysd-1988.