Jolie Design & Decor, Inc. v. van Gogh
Filing
59
ORDER granting 50 Motion for Reconsideration. Signed by Judge Mary Ann Vial Lemmon on 3/30/16. (cbn)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
JOLIE DESIGN & DÉCOR, INC.
CIVIL ACTION
VERSUS
NO: 15-740
KATHY VAN GOGH
SECTION: "S" (5)
ORDER AND REASONS
IT IS HEREBY ORDERED that Jolie Design & Décor, Inc.'s Motion to Reconsider or
Certify for Immediate Appeal (Doc. #50) is GRANTED as to certification for immediate appeal.1
BACKGROUND
This matter is before the court on plaintiff's motion to certify for immediate appeal (Doc.
#50) Judge Berrigan's denial of plaintiff's motion to reopen these proceedings (Doc. #49).2
Annie Sloan Interiors, Ltd. is a British corporation that owns Annie Sloan brand products,
including ANNIE SLOAN CHALK PAINT. Chalk paint is a decorative paint used to give furniture
an "antiqued" look by achieving a "chalky" matte finish. Plaintiff, Jolie Design & Décor, Inc., a
company based in Kenner, Louisiana, is the exclusive distributor and licensee of CHALK PAINT
in the United States and other countries. Defendant, Kathy van Gogh, who resides in Vancouver,
Canada, entered into a contract with Jolie Design to sell Annie Sloan brand products, including
CHALK PAINT. This dispute arose when van Gogh's relationship with Jolie Design ended and van
Gogh started selling products called "Kathy van Gogh Calk Paint Collection." Jolie Design claims
that this action violated the parties' agreement with respect to intellectual property.
1
Jolie Design's motion to reconsider is not discussed herein because the court finds that certifying
this matter for immediate appeal is appropriate.
2
This matter was originally allotted to Judge Helen G. Berrigan. On January 12, 2016, the case was
temporarily reallotted to Judge Mary Ann Vial Lemmon by order of Chief Judge Kurt D. Engelhardt due to
Judge Berrigan's leave of absence. (Doc. #52).
June 17, 2011, van Gogh and Jolie Design entered into the initial Retail Distribution
Agreement. The agreement was amended on October 5, 2011. The amended contract, which
represents the entire agreement between the parties, granted van Gogh "a nonexclusive,
nontransferable license" to use "Intellectual Property." "Intellectual Property" was defined as "the
trademarks, trade names, logos, and other designations used by Annie Sloan, Jolie Design, & Davis
Paint for the Products" that van Gogh would sell. Section 6(a) of the amended agreement included
the following limitations on van Gogh's use of the Intellectual Property:
You agree to comply with all guidelines that Jolie Design may set
related to your use of the Intellectual Property. Jolie Design has the
right to review and approve, at its discretion, any use of the
Intellectual Property and any presentation of the Products. Julie
Design has the right to prohibit the use of the Intellectual Property in
any manner. You agree to report to Jolie Design immediately, in
writing, any acts of infringement of the Intellectual Property of which
you learn. You agree to discontinue the use of the Intellectual
Property immediately upon termination of this Agreement, upon
breach of any term of this Agreement or upon initiation of litigation
related to this Agreement. Except for the rights and licenses granted
to you herein, Jolie Design and/or its licensors shall retain all right,
title and interest in the Products including all rights under or to the
Intellectual Property.
i. URLs and Social Media Pages: Your/your company's website or
related social media sites shall not include the terms "Annie Sloan,"
"Chalk Paint," and/or "Jolie Design" in the web address or user
identification field.
ii. Hyperlinks: The use of Intellectual Property to hyperlink to
you/your company's website is strictly prohibited. Any logo, image,
or other mark that serves as a hyperlink to your/your company's
website should reflect you and/or your company and shall not
incorporate any Intellectual Property.
2
iii. Search Engine Optimization ("SEO"): You are prohibited from
using the terms "Annie Sloan," "Chalk Paint," and/or "Jolie Design"
for SEO purposes on you/your company's website or social media
pages.
The contract included a dispute resolution clause which provided that any dispute arising
out of the agreement would be submitted to arbitration in New Orleans, Louisiana, and that
Louisiana law would apply. It also provided that the prevailing party in any dispute arising out of
the agreement is entitled to recover its costs and expenses, including reasonable attorneys' fees.
In April 2012, Jolie Design sought to amend the agreement again. Van Gogh, who did not
agree to the terms of the second amended agreement, provided written notice to Jolie Design on
April 18, 2012, that she was terminating the agreement. That same day, van Gogh applied to register
two trademarks using the term "CHALK PAINT." On April 21, 2012, van Gogh registered a domain
name using the term "CHALK PAINT."
Thereafter, van Gogh challenged the validity of the CHALK PAINT trademark in various
proceedings and filed an opposition seeking to preclude the registration of the CHALK PAINT logo
before the Trademark Trial Appeals Board. Van Gogh also applied to register "Kathy van Gogh
CHALK PAINT Collection" before the United States Patent and Trademark Office. When Annie
Sloan Interiors opposed the application, van Gogh argued that CHALK PAINT is an invalid
trademark.
On July 9, 2013, Jolie Design filed an arbitration demand against van Gogh. On September
30, 2013, Anthony M. DiLeo was appointed as the sole Arbitrator. In the arbitration, Jolie Design
sought to enjoin van Gogh from: challenging the validity of the CHALK PAINT trademark; using
the term CHALK PAINT to identify her products; and, advertising, producing, offering or
distributing any goods or services using the term CHALK PAINT. Jolie Design also sought an order
3
requiring van Gogh to: withdraw her application pending before the United States Patent and
Trademark Office and the Canadian Intellectual Property Office for trademarks that use the term
CHALK PAINT; immediately and permanently dismiss a Cancellation action pending before the
Trademark Trial Appeals Board in which she seeks to challenge the CHALK PAINT trademark;
transfer to Jolie Design the domain name van Gogh took out that included the words CHALK
PAINT; and the stop selling "van Gogh CHALK PAINT." Van Gogh countered that the CHALK
PAINT trademark is invalid, and that this is a matter for the United States Patent and Trademark
Office.
On December 17, 2013, Jolie Design filed a Motion for Dispositive Ruling asking the
Arbitrator to "dispose of the trademark validity issues – which are both meritless and irrelevant to
the breach of contract claims at issue." Jolie Design characterized the question presented in the
arbitration as "[w]heter Ms. van Gogh's continued use of the CHALK PAINT trademark following
her termination . . . constitute[d] a breach of Ms. van Gogh's obligation per Section 6(a) of the
contract." Van Gogh responded that the issue is "whether or not a trademark has been infringed."
In his July 9, 2014, Order Regarding Scope of Case and Interim Award, the Arbitrator found
that it was not appropriate to address the validity of the trademark or trade name in that forum.
Annie Sloan was not a party to the proceedings and the only claim at issue was a breach of contract
claim because van Gogh did not file a counterclaim for a declaratory judgment regarding the
invalidity of the trademark. The Arbitrator noted that proceedings before the Trademark Trial
Appeals Board will determine the ultimate ownership of the trademark and tradename, whereas the
proceeding before him involved only a claim for breach of contract. The Arbitrator found that the
specific language of the contract contemplates restrictions on the use of the words "chalk paint" by
4
van Gogh, and that she breached the contract by attempting to register the name "KATHY VAN
GOGH CHALK PAINT COLLECTION." The record remained open until August 8, 2014, for the
parties to submit further materials regarding attorneys' fees or costs, specific performance and
compensatory damages.
On January 19, 2015, the Arbitrator issued his Order and Final Award Regarding Costs,
Expenses and Attorneys' Fees. The Arbitrator denied van Gogh's motion for reconsideration of the
interim award, stating again that the only claim before him was Jolie Design's breach of contract
claim against van Gogh. The Arbitrator incorporated and reaffirmed the July 9, 2014, Order
Regarding Scope of Case and Interim Award. He enjoined van Gogh from using the term "chalk
paint" as a product identifier and from advertising, producing, offering, or distributing any goods
or services using the words "chalk paint" as required by the contract. The Arbitrator also awarded
to Jolie Design $1,194.40 for the court reporter and transcript, $45,000 for 242.2 hours in attorneys'
fees, $5,250 for the International Centre for Dispute Resolution's administrative fees and expenses,
$16,028.50 for the Arbitrator's compensation and expenses.
On March 6, 2015, Jolie Design filed this action in the United States District Court for the
Eastern District of Louisiana seeking a confirmation of the arbitration award under the United
Nations Convention for the Recognition and Enforcement of Foreign Arbitral Awards (June 10,
2958) 21 U.S.T. 2517, T.I.A.A. 6997, 330 U.N.T.S. 3 (the "New York Convention"), as
implemented by the Federal Arbitration Act ("FAA"), 9 U.S.C. § 201, et seq. On April 20, 2015, van
Gogh filed a Motion to Vacate the Arbitration Award (Doc. #9). She argues that the arbitration
award is invalid because the October 5, 2011, agreement was not validly formed. Van Gogh
contends that there was no meeting of the minds because she did not understand that the definition
5
of Intellectual Property included the term "chalk paint," which she contends is generic. Instead, she
thought that she was forbidden from using ANNIE SLOAN CHALK PAINT after the termination
of the agreement. Van Gogh also argues that even if the October 5, 2011, agreement was valid, the
Arbitrator exceeded his authority by looking outside the October agreement to the June 2011
agreement, and by awarding unreasonable attorneys' fees.3
Jolie Design argues that the enforceability of the arbitration clause was a matter for the
Arbitrator, not the court, to decide. It also argues that there was no vice of consent because van
Gogh knew that Annie Sloan claimed that CHALK PAINT was her trademark, even if van Gogh
thought that the trademark would be cancelled. Jolie Design also argues that a vice of consent calls
into question the enforceability of a contract, not its existence, which is a matter for the Arbitrator.
Further, Jolie Design argues that the Arbitrator did not exceed his authority by referencing the June
2011 agreement, and he did not award an unreasonable amount of attorneys' fees.
On May 11, 2015, Jolie Design filed a Motion to Confirm Arbitration Award (Doc. #19) in
which it argues that none of the grounds for a court's refusing to recognize an arbitration award
under the New York Convention are met. Jolie Design restates its position that van Gogh's argument
regarding the meeting of the minds is a collateral attack on the Arbitrator's interpretation of the
contract, which is not permitted, and that the Arbitrator did not decide matters outside of his
authority and awarded reasonable costs and attorneys' fees.
In opposition to Jolie Design's motion to confirm, van Gogh argues that the court can decide
de novo whether the October 5, 2011, agreement exists, and that the agreement was not validly
3
Van Gogh also argued that Jolie Design failed to comply with a jurisdictional requirement by failing
to provide the court with a proper copy of the October 5, 2011, agreement. On April 30, 2015, Jolie Design
filed an Amended Complaint to cure any such defect.
6
formed. She also argues again that the Arbitrator exceeded his authority and awarded an
unreasonable amount of attorneys' fees.
On May 28, 2015, van Gogh filed a Motion to Stay Confirmation of Arbitration Award (Doc.
#26). She argued that the matter should be stayed until the Trademark Trial and Appeal Board
disposed of the pending cancellation proceeding regarding the CHALK PAINT trademark because
the validity of the trademark affects the outcome of the arbitration proceeding. Van Gogh contended
that if CHALK PAINT is found to be generic, it could not have been part of the Intellectual Property
referred to in the contract, and then there would be "no meeting of the minds and no agreement to
arbitrate." Jolie Design opposed the stay arguing that it did not fit the sole reason for a stay of
confirmation of an arbitration award authorized by the New York Convention. On July 30, 2015,
Judge Berrigan issued an order staying this matter until Opposition No. 91208788 pending at the
Trademark Trial and Appeal Board is resolved because it "may be relevant to the scope and validity
of the arbitration awards and orders." (Doc. #38).
On October 1, 2015, Jolie Design filed a Motion to Reopen Proceedings (Doc. #43) stating
that on August 12, 2015, the Trademark Trial and Appeal Board ruled against van Gogh in
Opposition No. 91208788, refusing to register her proposed trademark. In opposition to Jolie
Design's motion to lift the stay, van Gogh argues that, although her proceedings before the
Trademark Trial and Appeal Board against Annie Sloan have concluded, there is an action by
Websters Chalk Paint Powder, LLC to cancel Annie Sloan's CHALK PAINT trademark. Van Gogh
contends that this action should remain stayed until that proceeding is concluded because it may
result in the cancellation of the CHALK PAINT trademark, which could affect the validity of the
arbitration award.
7
On December 30, 2015, Judge Berrigan denied Jolie Design's motion to reopen stating that
"[i]t appears that an action remains pending at the Trademark Trial and Appeal Board that directly
challenges the validity of the subject trademark, which is relevant to the arbitration awards and
orders herein. This matter shall be stayed to be reopened upon any motion filed after the resolution
of" that proceeding.
On January 11, 2016, Jolie Design filed a motion to certify for immediate appeal the denial
of its motion to reopen. (Doc. #50). Jolie Design argues that there is no basis under the New York
Convention or any jurisprudence to delay the confirmation of its arbitration award because the
validity of the CHALK PAINT trademark is irrelevant to the arbitration award which was based on
a breach of contract action. Van Gogh opposes the motion arguing that certifying the matter for
interlocutory appeal is unwarranted because the court was correct to stay the matter pending the
outcome of the proceedings regarding the validity of the CHALK PAINT trademark.
ANALYSIS
Interlocutory appeals are governed by 28 U.S.C. § 1292(b). Section 1292(b) states:
When a district judge, in making in a civil action an order not
otherwise appealable under this section, shall be of the opinion that
such an order involves a controlling question of law as to which there
is a substantial ground for difference of opinion and that an
immediate appeal from the order may materially advance the ultimate
termination of the litigation, [s]he shall so state in writing in such
order. The Court of Appeals which would have jurisdiction of an
appeal of such action may thereupon, in its discretion, permit an
appeal to be taken from such order, if application is made to it within
ten days after the entry of the order: Provided however, that
application for an appeal hereunder shall not stay proceedings in the
district court unless this district judge or the Court of Appeals or a
judge thereof shall so order.
8
28 U.S.C. § 1292(b). Pursuant to § 1292(b), the district court may “certify an interlocutory appeal
where (1) a controlling question of law is involved, (2) there is substantial ground for difference of
opinion about the question of law, and (3) immediate appeal will materially advance the ultimate
termination of the litigation.” Rico v. Flores, 481 F.3d 234, 238 (5th Cir. 2007).
Neither the July 30, 2015, order staying the case nor the December 30, 2015, order denying
Jolie Design's motion to reopen cites a provision of the New York Convention or jurisprudence
supporting the order. In arguing for the stay and against reopening the proceedings, van Gogh relies
on Hewlett-Packard Co., Inc. v. Berg, 61 F.3d 101 (1st Cir. 1995). Thus, Jolie Design argues that
the court must have relied on Berg in issuing the stay and refusing to reopen the proceedings.
In Berg the court examined whether a case brought to confirm an arbitration award issued
under the New York Convention could be stayed for prudential reasons. The court noted that
"[o]rdinarily there could be no doubt that a court, although obliged to decide a claim, would retain
discretion to defer proceedings for prudential reasons[,]" and that "a typical reason is pendency of
a related proceeding in another tribunal." Id. at 105. However, the court recognized that the New
York Convention could impact this power because the statute implementing the New York
Convention states that, upon a petition for confirmation of an arbitration award, a district court
"'shall confirm the award unless it finds one of the grounds for refusal or deferral of recognition or
enforcement of the award specified in the said Convention.'" Id. at 105-6 (quoting 9 U.S.C. § 207).
Although Article VI of the New York Convention enumerates a single ground for a stay,4 the court
4
Article VI of the New York Convention States:
If an application for the setting aside or suspension of the award has been made to
a competent authority [in the country where the award has been made], the authority
before which the award is sought to be relied upon may, if it considers it proper,
adjourn the decision on the enforcement of the award [and require a security].
9
held that actions to confirm such arbitration awards could be stayed for prudential reasons not
explicitly stated in the New York Convention. Id. at 106.
Jolie Design contends that Berg's application is limited to its facts where two parties are
forced into successive arbitration proceedings to resolve related matters, the prevailing party in the
first matter tries to have its arbitration award confirmed while the second proceeding is still pending,
the second proceeding might result in a monetary set-off against the party seeking confirmation for
the first award, and that party is otherwise insolvent. Citing Wartsila Finland OY v. Duke Capital
LLC, 518 F.3d 287, 294 (5th Cir. 2008), Jolie Design argues that the United States Court of Appeals
for the Fifth Circuit has implied, but not explicitly ruled, that Berg should be limited to its facts.
Thus, Jolie Design argues that this matter should be certified for immediate appeal so that the
appellate court can answer the question: "Does the Fifth Circuit recognize the authority of a district
court announced in Hewlett-Packard Co., Inc. v. Berg to adjourn confirmation proceedings of an
arbitration award for prudential reasons not specifically enumerated in the New York Convention?"
Van Gogh argues that there is no controlling issue of law because Jolie Design is appealing
a temporary stay. She also argues that there is no substantial ground for difference of opinion
because Jolie Design does not cite any authority disagreeing with the notion that Berg is not limited
to its facts.
This question of law stated by Jolie Design is a controlling question of law for which there
is substantial ground for difference of opinion, and its resolution will materially advance the ultimate
termination of the litigation. The question posed is a narrow legal question regarding the proper
applications of Berg, and there is a substantial ground for difference of opinion because the United
States Court of Appeal for the Fifth Circuit has not spoken on this issue. Further, resolution of this
10
question will materially advance this litigation because, if Berg is limited to its facts, the stay must
be lifted. Therefore, Jolie Design's motion to certify for immediate appeal is GRANTED.
CONCLUSION
IT IS HEREBY ORDERED that Jolie Design & Décor, Inc.'s Motion to Reconsider or
Certify for Immediate Appeal (Doc. #50) is GRANTED as to certification for immediate appeal.
30th
New Orleans, Louisiana, this _____ day of March, 2016.
____________________________________
MARY ANN VIAL LEMMON
UNITED STATES DISTRICT JUDGE
11
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?