Stelor Productions, v. Silvers

Filing 28

RESPONSE by Steven A. Silvers to [27-1] motion for entry of temporary restraining order implementing the injunction recommended by the Magistrate (mh, Deputy Clerk)

Stelor Productions, v. Silvers

Doc. 28

Case 9:05-cv-80393-DTKH

Document 28

Entered on FLSD Docket 06/09/2005

Page 1 of 34 Jun 9 2005

UNITE D STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA

STELOR PRODUCTIONS, L.L.C., a Delaware corporation, f/k/a STELOR PRODUCTIONS, INC., Plaintiff, v. STEVEN A. SILVERS, a Florida resident, Defendant. ____________________________________

CASE NO. 05-80393-CIV-HURLEY Magistr at e Hopkins

S I L V E R S' RESPONSE TO PLAINTIFF'S THIRD REQUEST FOR EMERGENCY TEMPORARY RESTRAINING ORDER Defendant, Steven A. Silvers ("Silvers") opposes this third request by Stelor Productions, LLC's ("Stelor") for a Temporary Restraining Order. This "emergency" relief has already been denied once by the Court and again by the Magistrate. On May 10, 2005, the Court entered an Order denying St elor's initial request for emergency relief and referred the TRO request to the Magistrate. See Exhibit A, Order Referring Motion For Temporary Restraining Order To Magistrate Judge. Although the Magistrate's Report and Recommendation recommends some limited preliminary injunctive relief, the Magistrate declined to enter the TRO and acknowledged Silvers statutory right to ten (10) days to file his objection. There is simply no rational reason to reverse this Court's May 10 Order and no rule, statute or case law that would deprive Silvers of his right to have ten (10) days to prepare and file his objection, or deny this Court the opportunity to conduct a full de novo review of the Magistrate's Report and Recommendation. And, furthermore there is no true factual need for this emergency relief. Stelor misleads the Court with its request to force Silvers to hand over control of his domain name to them which is tantamount to giving them ownership. Stelor is a mere licensee with no owner ship rights to Silvers' property, including the googles.com domain name. Stelor has never
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throughout the three years it has been Silvers' licensee had control of Silvers' googles.com domain name. That domain name was registered by Silvers in 1997 and has always been owned and contro lled by Silvers, and in fact is not even part of the intellectual property that Silvers licensed to Stelor under the 2002 License Agreement.1 Silvers has merely pointed his domain name to the

"Googles" Web site Stelor was developing under the License Agreement and allowed Stelor to use the domain name in connection with promoting the Web site until he terminated the license. Granting Stelor control of the googles.com domain name would be the same as granting an disgruntled terminated Burger King franchisee ownership rights in the Burger King trademark while it litigates whether the termination was proper. If this relief is granted, Stelor will literally own the domain name and can do whatever it wants with it, including re-registering it with an foreign registrar or selling it. Furthermore, Stelor misleads the Court with its claim that it cannot function without the use of the googles.com domain name. That is simply rubbish. Stelor offers no facts or rationale about why it cannot "launch" the "Googles" Web site, or attend the Licensing Show without use of Silvers' domain name. In fact, this Web site is fully operational and in Stelor's control right now. While we believe it is foolish for Stelor to continue to use the licensed Googles property in the face of this dispute, there is nothing to actually stop Stelor from doing so. Silvers has not filed to enjoin Stelor and will let a jury decide if the license was properly terminated. For purposes of considering this Motion, it is essential for the Court to understand that a do main name is not a Web site. A domain name is only a way for a user to access a Web site through the Internet. Each Web site on the Internet has a unique numeric Web address, much like a house has a street address. The Web site obtains its numeric address through the Web servicing company that hosts the Web site. To view and interact with a Web site, a user on the Internet needs to type in that
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The License Agreement lists only the Web site as part of the Licensed Properties. No domain names were ever licensed to Stelor. See Exhibit B.
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numer ic address. Because a numeric Web site address can be long and difficult to use, the alpha-based do main name system was created as an easier way for users to access a particular Web site. When so meone registers a domain name - usually in an alpha form - they tell the registrar to "point" that do main name to a particular numeric Web site address. That way when a user types in that particular do main name they will be connected to the corresponding Web site automatically without having to type in the actual numeric Web site address. The number of domain names that can point to or short cut to a particular Web site is unlimited. In fact, the more the better. Fo r example, if a user types in the domain name Stelorproductions.com the Web site created and controlled by Stelor appears. That Web site has its own address that the Stelorproductions.com do main name is pointing to. Stelor controls and owns the Web site address assigned to its Web site. At any time, Stelor can register other domain names and have those point to its Web site address as well. And, Stelor can give that numeric address to other people if they desire to have their registered do main name point to Stelor's Web site. But regardless of how many domain names point to Stelor's Web site, or even if no domain name points to the Stelor Web site, the Web site is always still accessible through its numeric Web site address. It is also important to understand that a domain name that points to a Web site has no bearing on the ability of the Web site operator to control the content of the Web site. The content is accessed by a password known only to the operator. In this case, Stelor controls the content and operation of its Web site. And much more important to this dispute, Stelor controls the content and access to the "Googles" Web site with a password known only to Stelor. That will not change until a jury determines that Silvers properly exercised his right to terminate the License Agreement.2

And even then, its is only that part of the Web site that contains "Googles" related properties that Stelor may not use. Stelor will retain ownership of the technology and all other substantive content that falls outside the scope of the License Agreement.
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At this very moment anyone can access the "Googles" Web site by going to Stelor's Web site. See Exhibit C, Supplemental Declaration of Keva Labossiere, Exhibits A-C. In fact, the "Googles" Web site seen there is the same Web site that the googles.com domain name pointed to prior to termination. Silvers has no physical ability to control or discontinue the "Googles" Web site. Stelor can point a multitude of other domain names to the "Googles" Web site address that are just as effect ive in getting the user to the "Googles" Web site as the googles.com domain name. Even if these ot her domain names are not ideal or as desirable as the googles.com domain name in promoting the Web site, the absence of Silvers' domain name pointing to the site is no impediment to Stelor's attenda nce at the Licensing Show, Stelor's marketing "launch" or allowing users to access the "Googles" Web site while we litigate the termination issue. Stelor may attract users to the "Googles" Web site using any domain names it chooses, and can use that domain name to promote the Web site at the Licensing Show or others ways related to its "launch." What Stelor actually seeks is to deprive Silvers of his statutory right to object to the Magistra te's Report and Recommendation, which he fully intends to do because the Magistrate made very grave errors in his legal and factual findings including adding to the License Agreement a new requirement that Silvers give Stelor a second notice of its breaches before terminating the License although Silvers complied fully with the 60-day notice provisions contained in the License Agreement. And, the puzzling finding that although Stelor has failed for over six months to give Silvers the audit he has the right to, failed to provide royalty statements, failed to account for product it has sold, and failed to provide Silvers samples of products it is offering for sale, Stelor has "complied with" the License Agreement! The Magistrate mistakenly yet effectively has rewritten the License Agreement so that Stelor has no obligations under the agreement with Silvers, and can ignore its obligations without consequence.

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Moreover, the Magistrate failed to apply long-established case law that holds that a terminated licensee's only remedy for wrongful termination - the claim Stelor is making - is damages; it cannot seek injunctive relief for any harm. See Dillard Homes v. Carroll, 152 So.2d 738, 740 (3d DCA 1963); Collins v. Pic-Town Water Works, Inc., 166 So.2d 760, 762 (2d DCA 1964) ("Thus the contract was terminated and was no longer enforceable by injunction or specific performance."); Jacksonville Elec. Auth. v. Beemik Bldrs. & Const., Inc., 487 So.2d 372 (1st DCA 1986); Airlines Reporting Corp. v. Incentive Int'l Travel, Inc., 566 So.2d 1377, 1379 (5th DCA 1990)(court vacated an injunction based on a terminated contract and remanded to determine whether the plaintiff's sole remedy - - money damages - - was available). Furthermore, when we file our objection to the Magistrates R&R, we intend to show the Court that the Magistrate mistakenly relied upon false testimony provided by Stelor. On the morning of the hear ing Stelor filed the affidavit of Steven Esrig. The Magistrate relied heavily on the statements in that affidavit for its factual findings, and we had no opportunity to present evidence to challenge the credibility of this testimony. We intend to supplement the record with evidence that shows that much of what Esrig said is patently untrue, and that Silvers was entirely within his rights to terminate the License Agreement. The Court should again deny Stelor's request for a TRO and preserve Silvers' statutory right to object to the Magistrate's Report and Recommendation. Respectfully submitted, s/ Gail A. McQuilkin Kenneth R. Hartmann, Fla. Bar No: 664286 Gail M. McQuilkin, Fla. Bar No. 969338 KOZYAK TROPIN & THROCKMORTON, P.A. Counsel for Defendant 2525 Ponce de Leon, 9th Floor Miami, Florida 33134 [phone]
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Adam T. Rabin DIMOND, KAPLAN & ROTHSTEIN, P.A. Co -Co unsel for Defendant 200 SE First Street, Suite 708 Miami, Florida 33131 [phone]

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CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing was sent via U.S. Mail this 9th day of June, 2005, to: Kevin C. Kaplan, Daniel F. Blonsky and David Zack of Burlington Weil Schwiep Kaplan & Blonsky, P.A., 2699 S. Bayshore Drive, Penthouse A, Miami, FL 33133.

s/ Gail A. McQuilkin
3339/101/254154.1

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