Pop Warner v. NH Youth Football

2007 DNH 027

• Court: District Court, D. New Hampshire
• Decided: March 1, 2007
• Docket: 06-CV-098-SM
• Status: Published

Opinion

Pop Warner v . NH Youth Football 06-CV-098-SM 03/01/07 UNITED STATES DISTRICT COURT

DISTRICT OF NEW HAMPSHIRE

Pop Warner Little Scholars, Inc.; Barbara Doughty, individually and on behalf of New Hampshire Pop Warner Football Conference; and Jason Patch, individually and on behalf of New Hampshire Pop Warner Football Conference, Plaintiffs

v. Civil N o . 06-cv-98-SM Opinion N o . 2007 DNH 027 New Hampshire Youth Football & Spirit Conference; Richard Pelletier; Robert Schiavoni; Ellen Shiavoni; and Deborah A . Smith, Defendants

O R D E R

Plaintiffs Pop Warner Little Scholars, Inc., Barbara

Doughty, individually and on behalf of New Hampshire Pop Warner

Football Conference, and Jason Patch, individually and on behalf

of New Hampshire Pop Warner Football Conference bring suit

against defendant New Hampshire Youth Football & Spirit

Conference, Richard Pelletier, Robert Schiavoni, Ellen Schiavoni,

and Deborah A . Smith, seeking redress for registered trademark

infringement (Count I ) , trademark dilution (Count I I ) , violations

of the Anticybersquatting Consumer Protection Act (Count I I I ) ,

unfair competition and false designation of origin (Count I V ) , fraudulent registration of a trade name under N.H. Rev. Stat.

Ann. (“RSA”) 349:10 (Count IV*), 1 breach of fiduciary duty (Count

V I ) , ultra vires (Count V I I ) , breach of contract (Count VIII),

and unfair and deceptive acts and practices in violation of RSA

7:28-f and RSA 358-A:2 (Count I X ) . Defendant also seeks a

declaratory judgment that the plaintiffs lacked authority to

change the New Hampshire Youth Football & Spirit Conference

Articles of Agreement (Count V ) .

Defendants move this court to dismiss the declaratory

judgment, breach of fiduciary duty, and ultra vires claims on

grounds that plaintiffs failed to join the New Hampshire Director

of Charitable Trusts as an indispensable party to this action.

(Document n o . 21.) Defendant also moves to dismiss the unfair

and deceptive acts and practices claim on the same grounds, or

alternatively, because plaintiffs have failed to state a claim

upon which relief can be granted. (Document n o . 23.) For the

reasons set forth below, defendants’ motions are denied.

1 An apparent typographical error in plaintiffs’ complaint has resulted in two counts being numbered “IV.” For simplicity here, the unfair competition and false designation of origin claim will be referred to as “Count IV” while the subsequent state claim will be referred to as “Count IV*.”

2 BACKGROUND

The facts, taken from the pleadings and accepted, for these

purposes, as true, are as follows. Pop Warner Little Scholars,

Inc. (“Pop Warner”) is a national organization devoted to

promoting team sports among American youth by offering various

football and “spirit” (cheerleading) programs throughout the

world. (Compl. ¶¶ 16-18.) Pop Warner identifies itself by using

the trademark “Pop Warner” and other related marks and logos,

many of which are registered with the Patent and Trademark

Office. (Compl. ¶¶ 27-28.) Pop Warner promotes itself, often

using its trademarks, through various means, including an

Internet web site available at www.popwarner.com. Although Pop

Warner does not itself sponsor youth football teams, the

organization associates with local and regional affiliates which

are chartered by Pop Warner and licensed to use the Pop Warner

trademarks in connection with their own football and spirit

programs (Compl. ¶ 3 1 ) , provided those local affiliates comply

with Pop Warner policies and procedures. (Compl. ¶ 23.)

One of the defendants in this case, the New Hampshire Youth

Football & Spirit Conference (“NHYF”), formerly known as the New

Hampshire Pop Warner Football Conference, was one such local

affiliate that operated under a Pop Warner charter “since at

3 least 1991." (Compl. ¶ 35.) During this time, NHYF operated

under the Pop Warner trademarks, consistent with the rules and

procedures set forth by Pop Warner. (Compl. ¶¶ 35-36.) One of

the mechanisms by which NHYF promoted itself was its web site,

which is available at www.nhpwfc.org. The acronym “nhpwfc” in

the domain name was derived from the organization’s prior name,

“New Hampshire Pop Warner Football Conference.” (Compl. ¶ 38.)

In June 2005, NHYF ended its relationship with Pop Warner

and associated itself with American Youth Football & Cheer

Association, a youth football and spirit organization that

essentially competes with Pop Warner. (Compl. ¶ 40.) As a

result of that decision, on June 2 0 , 2005, NHYF changed its

corporate name from New Hampshire Pop Warner Football Conference

to its current name, New Hampshire Youth Football & Spirit

Conference. (Compl. ¶ 43.) On the same day that NHYF formally

changed its name, it registered the trade name “New Hampshire Pee

Wee Football Conference” with the New Hampshire Secretary of

State, as well as the acronym for that trade name, “NHPWFC.”

(Compl. ¶ 46.) Because the acronym for the new trade name is

identical to the acronym for the old corporate name, NHYF has

continued to use the web address www.nhpwfc.org. (Compl. ¶ 4 7 ) .

4 NHYF continued to operate as it had prior to its decision to

dissociate from Pop Warner, including making use of the same bank

account. (Compl. ¶ 5 3 ) . Concerned for Pop Warner’s future in New

Hampshire, Barbara Doughty and Jason Patch, both plaintiffs in

this case, withdrew funds from a certificate of deposit held in

NHYF’s name, and placed those funds into an escrow account

pending resolution of the dispute. (Compl. ¶ 5 7 ) . On January 1 7 ,

2006, NHYF filed a complaint in New Hampshire Superior Court

against Doughty and TD Banknorth, N.A., asserting fraud,

conversion, and other related claims. (Def.’s Mot. Dismiss, Ex.

A). On July 2 1 , 2006, the state court stayed its suit pending

resolution of the instant federal action. (Notice of Stay in

Related Case, Ex. A ) .

DISCUSSION

In addition to various claims arising under federal law,

plaintiffs allege a host of state law claims including common law

trademark infringement and fraudulent registration of a trade

name, breach of fiduciary duty, ultra vires conduct, breach of

contract, and unfair and deceptive practices. Plaintiffs also

seek a declaratory judgment that NHYF lacked the authority to

change its articles of incorporation and that its use of NHYF

5 funds for anything other than the promotion of Pop Warner-

affiliated football was likewise unlawful.

Defendants urge this court to dismiss the declaratory

judgment, breach of fiduciary duty, and ultra vires claims under

Rule 12(b)(7) of the Federal Rules of Civil Procedure,2 because,

they assert, the New Hampshire Director of Charitable Trusts is

an indispensable party whom the plaintiffs have failed to join.

Defendants also urge this court to dismiss the unfair and

deceptive acts claim arising under state law (Count IX) for the

same reason, or alternatively, because the statute from which the

claim arises does not provide for a private right of action.

Accordingly, defendants argue that dismissal is appropriate under

Rule 12(b)(6) of the Federal Rules of Civil Procedure.

2 Rule 12(b)(7) provides that dismissal is appropriate for “[F]ailure to join a party under Rule 19.” Rule 19 states, in pertinent part: “A person who is subject to service of process and whose joinder will not deprive the court of jurisdiction over the subject matter of the action shall be joined as a party in the action if (1) in the person’s absence complete relief cannot be accorded among those already parties, or (2) the person claims an interest relating to the subject of the action and is so situated that the disposition of the action in the person’s absence may (I) as a practical matter impair or impede the person’s ability to protect that interest or (ii) leave any of the persons already parties subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations by reason of the claimed interest.”

6 The issues raised by defendants are important, but there is

a fundamental procedural issue that determines the proper

disposition of this case.

Under 28 U.S.C. § 1367(a), a federal court with original

jurisdiction over federal claims may also exercise “supplemental

jurisdiction over all other claims that are so related to claims

in the action within such original jurisdiction that they form

part of the same case of controversy under Article III of the

United States Constitution.” In considering whether claims are

sufficiently related so as to justify exercise of jurisdiction,

courts consider whether the supplemental claims derive from the

same “common nucleus of operative fact.” Fafel v . DiPaola, 399

F.3d 403, 412 n . 10 (1st Cir. 2005) (explaining that 28 U.S.C. §

1367(a) codifies the “common nucleus of operative fact” test

adopted in United Mine Workers v . Gibbs, 383 U.S. 715, 725 (1966)

(citation and quotation marks omitted)).

The substantive legal issues in this case fall into two

broad, yet easily identified, categories. The first involves

trademark infringement and consumer confusion regarding the

identity of NHYF and its association with Pop Warner. Although

there is one state law claim that falls in that category, the

7 bulk of these issues arise under federal law.3 The second broad

category involves the scope of authority possessed by the NHYF

board and whether its decision to dissociate from Pop Warner was

lawful under New Hampshire’s charitable trust laws.

While some common events underlie these various causes of

action, the specific inquiries into each are distinct.

Regardless of whether NHYF had the authority to dissociate from

Pop Warner, it did s o , and that change in affiliation may, as

they allege, harm plaintiffs’ intellectual property rights. Put

differently, whether consumers are likely to continue to believe

that NHYF is associated with Pop Warner is a question wholly

separate from whether NHYF had authority to change the

affiliation of the underlying charitable trust.

Further, the parties’ interests in each category of claims

are different. M s . Doughty and M r . Patch, as individuals, have

no interest in the Pop Warner trademarks, which serve to identify

both the national organization and its football and cheerleading

3 Trademark infringement under 15 U.S.C. § 1125(a) (Count I ) , trademark dilution under 15 U.S.C. § 1125(c) (Count I I ) , violations of the Anticybersquatting Consumer Protection Act (15 U.S.C. § 1125(d) (Count I I I ) , and unfair competition and false designation of origin under 15 U.S.C. § 1125(a) (Count I V ) .

8 programs, as well as the local affiliates licensed to use such

marks. There is no indication that M s . Doughty or M r . Patch, or

any other individual has ever used a Pop Warner mark to identify

any goods or services offered by them. Accordingly, neither M s .

Doughty nor M r . Patch have rights in the Pop Warner marks.

Similarly, Pop Warner has no legal interest in whether NHYF

unlawfully changed its charitable purpose. While Pop Warner’s

business in New Hampshire may have been harmed by NHYF’s decision

to dissociate, whether NHYF breached its duties under state law

is irrelevant to the trademark inquiry, which principally

concerns consumer confusion.

Simply put, the facts necessary to resolve the federal

trademark issues are quite different from those necessary to

resolve charitable trust issues that arise under state law.

Because these two distinct categories of claims do not share a

common nucleus of operative fact, the court declines to exercise

supplemental jurisdiction over the breach of fiduciary duty

(Count V I ) , ultra vires (Count V I I ) , breach of contract (Count

VIII), and unfair and deceptive practices (Count IX) claims.

9 The court similarly declines to exercise jurisdiction over

plaintiffs’ request for a declaratory judgment (Count V ) . The

Declaratory Judgment Act, 28 U.S.C. § 2201, provides that a court

“may declare the rights and other legal relations of any

interested party seeking such declaration, whether or not further

relief is or could be sought.” The Act, however, is “‘an

enabling Act, which confers a discretion on the courts rather

than an absolute right upon the litigant’; courts have broad

discretion to decline to enter a declaratory judgment.”

DeNovellis v . Shalala, 124 F.3d 2 9 8 , 313 (1st Cir. 1997) (quoting

Wilton v . Seven Falls Co., 515 U.S. 2 7 7 , 287 (1995)). “‘In the

declaratory judgment context, the normal principle that federal

courts should adjudicate claims within their jurisdiction yields

to considerations of practicality and wise judicial

administration.’” Id. (quoting Wilton, 515 U.S. at 2 8 8 ) .

The issues presented in plaintiffs’ request for a

declaratory judgment4 are governed entirely by state law and

4 Paragraph 94 of the original complaint reads: “For the reasons set forth, the Plaintiffs seek a declaration, pursuant to 28 U.S.C. § 2201 and RSA 491:22, that [NHYF] was without authority to amend its Articles of Agreement to change its charitable purpose that such amendment is without effect, and that it had no ability to use or spend [NHYF] funds to support AYF conference activities.”

10 require factual and legal inquiries wholly distinct from those

necessary to adjudicate the federal trademark issues.

Accordingly, in the interest of comity and judicial economy, the

court declines to exercise its authority under the Declaratory

Judgment Act.

CONCLUSION

For the foregoing reasons, the court declines to exercise

supplemental jurisdiction over Counts VI-IX and declines to

exercise its jurisdiction under the Declaratory Judgment Act as

to Count V. Accordingly, those claims are dismissed without

prejudice, and defendants’ motions to dismiss (document nos. 21

and 23) are denied as moot. What remains, then, are the state

and federal intellectual property claims (Counts I, II, III, IV,

and IV*), which may well be amenable to settlement by agreement,

or on summary judgment.

SO ORDERED.

____________________________ Steven J./McAuliffe /Chief Judge March 1, 2007

cc: Thomas J. Donovan, Esq. Adam M. Hamel, Esq. Michael D. Ramsdell, Esq.