The Preston Partnership, LLC v. ADG Design Studio, LLC et al
Filing
15
OPINION AND ORDER denying The Preston Partnership, LLC's Emergency Motion for Temporary Restraining Order and Injunctive Relief 3 . Signed by Judge William S. Duffey, Jr on 8/17/17. (ddm)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
THE PRESTON PARTNERSHIP,
LLC,
Plaintiff,
v.
1:17-cv-2846-WSD
ADG DESIGN STUDIO, LLC,
ATLANTA DESIGN GROUP, INC.,
CHANDRA CHERRY, and
MARK DARNELL,
Defendants.
OPINION AND ORDER
This matter is before the Court on Plaintiff The Preston Partnership, LLC’s
(“Plaintiff” or “Preston”) “Emergency Motion for Temporary Restraining Order
and Injunctive Relief” [3] (“Motion for TRO”).
I.
BACKGROUND
Preston is an architectural and interior design firm located in Atlanta,
Georgia. (Compl. ¶ 9). Preston has a nationwide portfolio of mid- to large-scale
multifamily and mixed-use projects. (Id.).
Defendant Chandra Cherry (“Ms. Cherry”) is an interior designer. From
March 1, 2006, to March 31, 2017, Ms. Cherry worked at Preston as a Principal of
Interior Design. (Id. ¶ 10).
In April 2017, Ms. Cherry and three (3) other former Preston employees
joined ADG Design Studio, LLC (“ADG Studio”), a newly-created division of
Defendant Atlanta Design Group, Inc. (“Atlanta Design Group”). (Id. ¶ 11; Tr. at
32, 35). Ms. Cherry is a Managing Partner of ADG Studio and Atlanta Design
Group. (Compl. ¶ 11). Defendant Mark Darnell is the Managing Member of ADG
Studio and the President of Atlanta Design Group. (Id. ¶ 5).
In July 2017, ADG Studio launched its website, studio.atldesigngroup.com
(the “Website”). (Tr. at 13; see also Compl. ¶ 12).1 The Website contains
photographs of interior design projects that were completed by Ms. Cherry, along
with other Preston employees, while Ms. Cherry worked at Preston (the
“Photographs”). (Tr. at 8). The Photographs appear on the Website: (1) on the
homepage, as sliding images moving across the screen; (2) as a collection of
thumbnail images under the main “Portfolio” page; and (3) individually, in larger
format, when selected from the “Portfolio” page. In small, white letters on the
bottom right corner of the Photographs is a statement which reads: “Work done
while Principal at The Preston Partnership.” Plaintiff asserts that this statement is
false because neither ADG Studio nor Atlanta Design Group was ever a Principal
at Preston. Plaintiff asserts further that the small text, coupled with the images
1
The address, adg-studio.com, redirects to studio.atldesgingroup.com. (See
Compl. ¶ 12).
2
sliding across the screen, make the statement “indecipherable.” (Compl. ¶ 15; Tr.
at 8-10).
Plaintiff also alleges that the design of the Website is misleading because the
Website does not contain a section highlighting Ms. Cherry’s personal portfolio of
work. Rather, the Photographs are represented as showing ADG Studio’s portfolio
of work, when in fact ADG Studio—a newly created company—does not have a
portfolio of work. (Compl. ¶ 16; Tr. at 7-8, 10).
On July 12, 2017, Robert Preston (“Mr. Preston”), President of The Preston
Partnership, sent Ms. Cherry an email, asserting that the Photographs on the
Website were misleading and asking that they be removed. (Id. ¶ 18).
On July 21, 2017, Preston’s counsel sent Ms. Cherry a letter demanding that
ADG Studio “cease and desist the unauthorized representation of Preston’s work
on the ADG Studio website.” (Id. ¶ 20). Mr. Darnell and three other ADG Studio
employees were copied on the letter. Plaintiff alleges that Defendants failed to
respond to Plaintiff’s communications.
On July 27, 2017, Plaintiff filed its Complaint [1], asserting claims for
violation of the Lanham Act, 15 U.S.C. § 1125(a), for false designation of origin of
services; violation of the Georgia Deceptive Trade Practices Act, O.C.G.A.
§ 10-1-372 (Count II); injunctive relief (Count III); and attorneys’ fees (Count IV).
3
On July 28, 2017, Plaintiff filed its Motion for TRO under its Lanham Act
claim, seeking to enjoin Defendants (1) from displaying any photographs on the
Website depicting Plaintiff’s interior design work, and (2) from misrepresenting
the origin of the Photographs in a way that is likely to cause confusion as to the
origin of the work.
On August 9, 2017, the Court conducted a hearing on Plaintiff’s Motion for
TRO. At the hearing, Mr. Preston stated that having photographs of Preston
projects on ADG Studio’s Website “is very deceiving because it gives the
impression that ADG has a history very similar to what our history is. It gives the
clear impression that those projects were done . . . by ADG when obviously they
were not. And I think it gives them a false portfolio of work when really they
obviously don’t have a portfolio of work because they are a start-up company.”
(Tr. at 8). Mr. Preston testified that he “think[s] there will inevitably be confusion
that those projects [in the Photographs on the Website] were done by ADG and not
by Preston.” (Tr. at 20). Mr. Preston admitted, however, that he is not aware of
any complaints from prospective or existing clients that the projects depicted in the
Photographs on the Website were completed by ADG, and not Preston, and he
does not expect to know of clients that have engaged ADG because of their
portfolio of work. (Tr. at 19-20). Mr. Preston also stated that he has not lost any
4
business as a result of people seeing the Photographs on the Website and being
drawn to ADG for design work. Mr. Preston testified:
No, I can’t sit here and say that I have lost business. I’m not
aware that I have lost business. But, again, I don’t know how I would
become aware, you know.
And it may not even be business that I might have gotten, and
I’m fine with that. You know, it’s more I feel that the [W]ebsite is
very deceiving and gives them a sense of credibility, if you wish, that
they really don’t deserve. It isn’t their credibility. I mean, they are a
start-up company.
(Tr. at 21-22).
Ms. Cherry also testified at the hearing. She asserted that she intended to
credit Preston for the work shown in the Photographs, and after the Complaint was
filed, Defendants offered, and still want, to work with Plaintiff to reach an
acceptable solution. The parties attempted to resolve their concerns after the
hearing, but were unsuccessful.
II.
DISCUSSION
A.
Legal Standard
To obtain a temporary restraining order, a party must demonstrate “(1) a
substantial likelihood of success on the merits; (2) that irreparable injury will be
suffered if the relief is not granted; (3) that the threatened injury outweighs the
harm the relief would inflict on the non-movant; and (4) that the entry of the relief
5
would serve the public interest.” Schiavo ex. rel Schindler v. Schiavo, 403 F.3d
1223, 1225-26 (11th Cir. 2005) (per curiam). “[A] [temporary restraining order or
preliminary injunction] is an extraordinary and drastic remedy that should not be
granted unless the movant clearly carries its burden of persuasion on each of these
prerequisites.” SunTrust Bank v. Houghton Mifflin Co., 252 F.3d 1165, 1166
(11th Cir. 2001) (per curiam) (citation omitted).
B.
Analysis
1.
Likelihood of Success on the Merits
Plaintiff seeks a TRO on its claim for false designation of origin under
Section 43(a)(1)(A) of the Lanham Act. Section 43(a)(1)(A) prohibits using:
in commerce any word, term, name, symbol, or device, or any
combination thereof, or any false designation of origin, false or
misleading description of fact, or false or misleading representation of
fact, which—
(A) is likely to cause confusion, or to cause mistake, or to deceive as to
the affiliation, connection, or association of such person with another
person, or as to the origin, sponsorship, or approval of his or her goods,
services, or commercial activities by another person . . .
15 U.S.C. § 1125(a).
“To prevail on a false designation of origin claim, a plaintiff must show it
was either actually or likely to be damaged by the fact that the defendant used a
‘false designation of origin, false or misleading description of fact, or false or
6
misleading representation of fact, which [wa]s likely to cause confusion, or to
cause mistake, or to deceive . . . as to the origin . . . of his or her goods, services, or
commercial activities by another person.’” Lipscher v. LRP Publ., Inc., 266 F.3d
1305, 1312-13 (11th Cir. 2001) (citing 15 U.S.C. § 1125(a)(1)(A)) (emphasis
added). To support a claim under Section 43(a)(1)(A), a plaintiff must show:
(1) the goods or services at issue originated with the plaintiff; (2) the defendant
falsely designated the origin of the work; (3) the false designation was likely to
cause consumer confusion; and (4) the plaintiff was harmed by the defendant’s
false designation. See PHA Lighting Design, Inc. v. Kosheluk, No. 1:08-cv-1208,
2010 WL 1328754, at *4 (N.D. Ga. Mar. 30, 2010).
(a)
Whether the false designation is likely to cause consumer
confusion
Here, assuming that the Lanham Act applies to Plaintiff’s claim,2 Plaintiff
fails to allege facts to support that Defendants’ allegedly false designation is likely
to cause consumer confusion. “While there is no bright line test to determine the
existence of a likelihood of consumer confusion, recovery under the Lanham Act
requires, at a minimum, that confusion, mistake, or deception be likely, not merely
2
Because the Court finds that Plaintiff fails to show that Defendants’
allegedly false designation is likely to cause consumer confusion, and Plaintiff fails
to show that it was harmed by Defendants’ allegedly false designation, the Court
does not decide the impact, if any, of Dastar Corp. v. Twentieth Century Fox Film
Corp., 539 U.S. 23 (2003), on Plaintiff’s claim in this action.
7
possible.” Custom Mfg. & Eng’g, Inc. v. Midway Servs., Inc., 508 F.3d 641, 651
(11th Cir. 2007). Factors courts in this circuit consider include defendant’s intent
and actual confusion. Lipscher, 266 F.3d at 1313; Suntree Techs., Inc. v. Ecosense
Int'l, Inc., 693 F.3d 1338, 1348 (11th Cir. 2012) (focusing on defendant’s intent
and actual confusion, stating, where “defendant has taken the plaintiff’s product
and has represented it to be his own work,” the first five factors of the likelihood of
confusion test are irrelevant).3 See also Frehling Ent., Inc. v. Int’l Select Grp., Inc.,
192 F.3d 1330, 1335 (11th Cir. 1999) (“Of these, the [strength of the] mark and
evidence of actual confusion are the most important.”). A plaintiff must do more
than simply show that defendant passed off the plaintiff’s services as their own.
Lipscher, 266 F.3d at 1313-14.
In its Brief, Plaintiff argues only that Defendants’ “refus[al] to remove the
photographs of Preston’s design work from ADG Studio’s website despite an email
and a cease-and-desist letter provides strong evidence of their intent to mislead
consumers.” (Pl’s Br. at 6). That Defendants offered to “make [sic] reasonable
remedial measures to ensure that [Plaintiff] is properly credited for work depicted
3
Courts in this circuit look to the following factors to determine whether a
likelihood of confusion exists in Lanham Act trademark claims: (1) type of mark;
(2) similarity of mark; (3) similarity of the products the marks represent; (3)
similarity of the parties' retail outlets and customers; (5) similarity of advertising
media; (6) defendant’s intent; and (7) actual confusion. Lipscher, 266 F.3d at 1313
(recognizing all of the factors may not be relevant to a reverse passing off claim).
8
in the [P]hotographs” (see [10.1] at 44-45), and their efforts to negotiate a
resolution with Plaintiff before and after the hearing, undercut Plaintiff’s assertion
that Defendants, even after having notice of Plaintiff’s claim, intentionally
continued to use the Photographs on the Website to confuse consumers. See
Suntree, 693 F.3d at 1348 (“defendant’s immediate destruction of the brochure and
its elimination of the maintenance presentation from its website support its
assertion that [defendant] did not intend to confuse potential customers with photos
of [plaintiff’s] product”); Can-Am Eng’g Co. v. Henderson Glass, Inc., 814 F.2d
253, 257 (6th Cir. 1987) (“Plaintiff confuses the intentional use of the photo with
the kind of intent to misrepresent which is the cornerstone of a money damage
action. We note in this regard the swift and effective remedial action [defendant]
undertook immediately upon being notified of its error. Under such circumstances
we find no false representation which is actionable under the Lanham Act.”)
(quoted with approval in Suntree, 693 F.3d at 1348); Matrix Motor Co. v. Toyota
Jidosha Kabushiki Kaisha, 290 F. Supp. 2d 1083, 1096 (C.D. Cal. 2003) (“[T]he
failure to stop using a mark after receiving a cease and desist letter does not show
willful infringement and is ‘not necessarily indicative of bad faith.’”) (quoting
SecuraComm Cons., Inc. v. Securacom Inc., 166 F.3d 182, 189 (3d Cir. 1999)).
9
Plaintiff does not offer any evidence of actual or likely consumer confusion.
At the hearing, Mr. Preston testified that he “think[s] there will inevitably be
confusion that those projects [in the Photographs on the Website] were done by
ADG and not by Preston.” (Tr. at 20). Mr. Preston admitted, however, that he is
not aware of any complaints from prospective or existing clients that the projects
depicted in the Photographs on the Website were completed by ADG, and not
Preston. (Tr. at 19-20). Plaintiff fails to show that Defendants’ allegedly false
designation is likely to cause consumer confusion. See Hi-Tech Pharm, 311 F.
Supp. 2d at 1357 (plaintiff did not establish likelihood of consumer confusion,
including because, “importantly, [plaintiff] has not clearly demonstrated the nature
and extent of confusion in the marketplace. [Plaintiff] has not undertaken any
consumer surveys and the record contains no sworn consumer testimony”); cf. All
Metals, Inc. v. Hinely Indus., Inc., 222 F.3d 895, 907 (11th Cir. 2000) (“The most
persuasive evidence in assessing the likelihood of confusion is proof of actual
confusion.”). Plaintiff fails to show that Defendants’ allegedly false designation is
likely to cause consumer confusion.
(b)
Whether Plaintiff was harmed by Defendants’ false designation
Plaintiff further fails to allege facts to support that it was harmed by
Defendants’ allegedly false designation. In its Brief, Plaintiff conclusorily asserts
10
that “Defendants’ false designation of origin of Preston’s work on ADG Studio’s
website has caused, and is likely to further cause, competitive or commercial injury
to Preston” because “[p]hotographs posted to an online portfolio on a business’s
website are likely to have a material effect on the purchasing decisions of
consumers.” (Pl’s Br. at 6). Plaintiff does not offer evidence that it has lost any
customers or goodwill. Rather, Mr. Preston, at the hearing, stated that he has not
lost business as a result of people seeing the Photographs on the Website and being
enticed to contact Defendants. Mr. Preston testified further that “it may not even
be business that [Preston] might have gotten” but “it’s more that [he] feel[s] that
the [W]ebsite is very deceiving and gives [Defendants] a sense of credibility
. . . that they really don’t deserve.” (Tr. at 21-22). Plaintiff fails to show that it
was harmed by Defendants’ allegedly false designation. See PHA Lighting, 2010
WL 1328754, at *5 (plaintiff failed to show that it was harmed by claimed false
designation where plaintiff did not show that businesses hired defendant based
brochure containing alleged false designation, or that plaintiff was in the running
for the jobs obtained by defendant, that plaintiff’s sales declined since defendant
started distributing brochure, or that defendant’s actions tarnished plaintiff’s
goodwill or reputation); cf. Curves Int’l, Inc. v. Mosbarger, 525 F. Supp. 2d 1310,
1314-15 (M.D. Ala. 2007) (where plaintiff failed to offer supporting evidence,
11
plaintiff’s “allegation of los[t] goodwill” did not establish a likelihood of
non-speculative, irreparable injury).
Plaintiff fails to allege facts to support that Defendants’ allegedly false
designation is likely to cause consumer confusion, and Plaintiff further fails to
show that it was harmed by Defendants’ allegedly false designation.4 The Court
concludes that Plaintiff is not likely to succeed on the merits of its Lanham Act
claim, and Plaintiff’s Motion for TRO is denied. See Lipscher, 266 F.3d at
1312-13; PHA Lighting, 2010 WL 1328754 at *4. Having found that Plaintiff is
not likely to succeed on the merits of its claim, the Court is not required to address
the other factors for granting a TRO. See Schiavo, 403 F.3d at 1225-26; Houghton
Mifflin, 252 F.3d at 1166.5
4
Plaintiff’s principal complaint appears, at its core, to object to ADG Studio’s
representing itself as more than it is—that its website should characterize the
company as a startup with no portfolio of work. The Lanham Act does not reach
that far. Cf. Sussman-Automatic Corp. v. Spa World Corp., 15 F. Supp. 3d 258,
270-271 (E.D.N.Y. 2014) (The Lanham Act expressly forbids false or misleading
descriptions or representations of fact; it does not prohibit “puffery,” “an
exaggeration or overstatement expressed in broad, vague, and commendatory
language”).
5
The Court notes that Plaintiff has an adequate remedy at law because
Plaintiff may recover losses and damage it claims it will suffer as a result of
Defendants’ allegedly false designation of origin, by an award of damages in this
action. See, e.g., Ne. Fla. Chapter of Ass’n of Gen. Contractors of Am. v. City of
Jacksonville, Fla., 896 F.2d 1283, 1285 (11th Cir. 1990) (“An injury is
‘irreparable’ only if it cannot be undone through monetary remedies.”); Mosbarger,
525 F. Supp. 2d at 1314-15 (while loss of customers and goodwill is an irreparable
12
III.
CONCLUSION
For the foregoing reasons,
IT IS HEREBY ORDERED that The Preston Partnership, LLC’s
“Emergency Motion for Temporary Restraining Order and Injunctive Relief” [3] is
DENIED.
SO ORDERED this 17th day of August, 2017.
injury, the injury must be neither remote nor speculative, but actual and imminent).
Plaintiff’s Motion for TRO is denied for this additional reason. See Schiavo,
403 F.3d at 1225-26; Houghton Mifflin, 252 F.3d at 1166.
13
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?