  |
  |
  |
    
  
   |
 | |||
|
|
|
|
| |||
Facts: The City of New York (the "City") owns the premises on Central Park West known as 'Tavern on the Green.' In 1934, the City converted the location into a restaurant and licensed operations of the restaurant to a third party. Since 1934, 'Tavern on the Green' has become very well known. In 1973, the City and Tavern on the Green, L.P. and LeRoy Adventures, Inc. (the "Debtors") entered into a licensing agreement (the "1973 Agreement") for the operation of the restaurant. The 1973 Agreement was amended on July 1976 (the "1976 Amendment") and remained in effect until it was modified in 1985. Between 1973 and 1976, the restaurant was extensively renovated. The 1973 Agreement describes the grant to the Debtors as a 'license' and, with respect to the name 'Tavern on the Green,' the license allowed the Debtors to change the name so long as they got the City's permission. The Debtors never sought to change the name. In 1985, the Debtors and the City renewed their agreement (the "1985 Agreement"), which was titled a 'License Agreement.' The 1985 Agreement did not allow the Debtors to change the restaurant's name. In 1978, Warner LeRoy applied, on behalf of a joint venture, to register the name 'Tavern on the Green.' He applied to the U.S. Patent and Trademark Office (the "PTO") and claimed that the name had first been used in 1976. He also represented that no other entity has the right to use the name. LeRoy did not disclose the 1973 Agreement nor did he disclose to the City that he applied for the trademark. Ultimately, the PTO approved registration of the mark in 1981. In 1986, the Debtors filed an affidavit with the PTO swearing that the mark had been in continuous use for the previous 5 years and, when the PTO accepted the affidavit, the mark became 'incontestable' under 15 U.S.C. § 1605. In 2007, the Debtors applied to register the name 'Tavern on the Green' for cooking oils, salad dressings, and dipping oils. The PTO approved the application and it was registered in 2008. In September 2009, the Debtors filed chapter 11. The City selected another operator for the restaurant and sued asking for a declaration that it is the only entity with the right to use the name 'Tavern on the Green.'
Issue: Whether the City or the Debtors have the right to use the name 'Tavern on the Green.'
Holding: "[T]he Debtors' registered mark for restaurant services is not incontestable as against the City, which has shown a prior right under New York law to the 'Tavern on the Green' name for its historic restaurant in Central Park."
Rule: "Section 1065 provides for the incontestability of a registered mark upon the filing of an affidavit of five years of continuous use, with limited exceptions. The statute provides:
'Except on a ground for which application to cancel may be filed at any time under paragraphs (3) and (5) of section 1064 of this title, and except to the extent, if any, to which the use of a mark registered on the principal register infringes a valid right acquired under the law of any State or Territory by use of a mark or trade name continuing from a date prior to the date of registration under this chapter of such registered mark, the right of the registrant to use such registered mark in commerce for the goods or services on or in connection with which such registered mark has been in continuous use for five consecutive years subsequent to the date of such registration and is still in use in commerce, shall be incontestable....' 15 U.S.C. § 1065 (2006)."
In New York, "'[the] law of unfair competition encompasses claims for infringement of an unregistered trade name or trademark.' In order to establish a protectible right to a trade name under New York law, the City must proffer undisputed facts that show that the defendants are unfairly attempting to exploit the efforts of another to create goodwill in that trade name." Additionally, to establish 'continuing use' under New York law "requires an 'unbroken continuum of use without significant interruptionŠ'"
Reasoning: For the City to establish a prior right in the name, it must establish that it has a valid right acquired under NY law prior to the date on which the Debtors registered the name (1981). In this case, the City has provided convincing evidence that it had a right to the name before 1981. The 1973 Agreement required the City's consent before the Debtors could change the restaurant's name from Tavern on the Green. The 1973 Agreement and the 1976 Amendment also contain provisions in which the City has rights to oversee the management of the restaurant. Ultimately, the "evidence shows that the City established the restaurant well over
©2010 Leif M. Clark
