Court: District Court, S.D. New York; January 11, 2010; Federal District Court
Plaintiff JA Apparel Corp. is suing Defendants Joseph Abboud, Houndstooth Corp., and Herringbone Creative Services, Inc. for breach of contract and various trademark-related claims stemming from a June 16, 2000 Purchase and Sale Agreement and a related July 13, 2000 Side Letter Agreement. Defendants have counterclaimed against JA Apparel and its principal, Martin Staff, for false endorsement, false advertising, and other claims related to actions taken after the Side Letter expired. The parties have consented to a trial before the Court under 28 U.S.C. 636(c) and Fed. R. Civ. P. 73.
After a bench trial, the Court initially ruled that the Agreement included the sale of all of Abboud’s trademarks and his name for commercial purposes, granting JA Apparel injunctive relief and dismissing Abboud’s counterclaims. However, on appeal, the Second Circuit found the Agreement's language ambiguous, vacating the Court's decision and remanding for further proceedings. Upon remand, the parties submitted extensive briefs concerning the intent behind the Agreement and the implications of Abboud's proposed advertisements for a new clothing line using his name.
The core issue revolves around the interpretation of the Purchase and Sale Agreement, which involved a $65.5 million payment to Abboud in exchange for transferring all rights related to his trademarks, licenses, new trademarks, and relevant documentation to JA Apparel.
Goodwill associated with the Trademarks is included in the definition of "Assets" as outlined in the Agreement. An exhibit titled "Trademark Report by Mark" lists Joseph Abboud's name. The Agreement features an integration clause asserting it represents the complete understanding between the parties regarding the transactions, superseding all prior agreements.
A Side Letter dated July 13, 2000, details Abboud's role as "Chairman Emeritus" of JA Apparel, during which he would provide consulting services for five years, with a two-year non-competition clause extending until July 13, 2007. Following the execution of both the Agreement and Side Letter, tensions arose between the parties, leading Abboud to file a lawsuit against JA Apparel, which he later dismissed. A temporary resolution occurred in mid-2004, granting Abboud new responsibilities. However, by spring 2005, Abboud indicated he would not continue with JA Apparel, and the Personal Services period ended on July 13, 2005, initiating the Restricted Period.
In early 2007, Abboud began planning a competing clothing line called "jaz." JA Apparel became aware of this venture in August 2007 through a DNR magazine article stating that Abboud was initially prohibited from using his name, but later clarified that he could use it in marketing for "jaz." Subsequent articles confirmed Abboud's promotional plans, featuring mock-up ads that included "Joseph Abboud" alongside the "jaz" brand. JA Apparel asserts that Abboud's use of his name in connection with "jaz" would breach the Agreement, infringe on its trademarks, and amount to unfair competition, despite his right to compete in the menswear market.
Defendants argue that Abboud only sold the use of his name as a trademark and did not transfer the exclusive right to use his name for all commercial purposes, claiming the proposed advertising use constitutes trademark fair use. They have filed counterclaims against JA Apparel and Staff, alleging deceptive practices and unfair competition related to the use of Abboud's name.
In the procedural history, in "Abboud I," both parties contended that the Agreement was clear. Plaintiff argued that the Agreement's inclusion of "names" along with trademarks indicated Abboud sold the commercial rights to his name. Defendants countered that "names" merely described trademarks, hence only trademarks containing his name were sold. The court agreed with the Plaintiff, concluding that Abboud transferred all rights to commercially use his name, which prohibited him from using it for his new clothing line, resulting in a permanent injunction against him. The court also found Abboud's proposed use constituted trademark infringement, dismissing his counterclaims based on the sale of exclusive rights to the name.
On appeal, the Second Circuit disagreed with the lower court's interpretation of "names" as unambiguously granting exclusive commercial rights to the Joseph Abboud name, remanding for further examination of extrinsic evidence regarding the parties' intent. While the Second Circuit acknowledged JA Apparel's interpretation as plausible, it also recognized Abboud's interpretation as reasonable. The appellate court indicated that if the district court does not favor JA Apparel on remand, it must address trademark issues, noting that individualized consideration of proposed advertisements is necessary for Abboud's fair use defense. The Second Circuit refrained from addressing other issues decided by the lower court but allowed for those issues to be revisited on remand.
Two key questions must be addressed on remand: 1) Did Abboud agree to sell his name to JA Apparel beyond trademark or intellectual property rights based on the Agreement’s language and any extrinsic evidence of intent? 2) If Abboud sold his name solely as a trademark or related intellectual property, do his proposed advertisements qualify as fair use under the Lanham Act? A positive answer to the first question negates the need to assess the second or any other claims.
Regarding contract interpretation under New York law, the parties' intent is paramount, primarily determined by the written agreement's language. Courts should avoid inferring terms not explicitly included by sophisticated parties. Clear and unambiguous contracts must be enforced as written, without judicial alteration. The determination of ambiguity is a legal question for the courts; differing party interpretations do not inherently create ambiguity. When a contract is deemed unambiguous, extrinsic evidence is inadmissible, while ambiguity allows for the consideration of surrounding facts and circumstances to ascertain intent. Courts will examine the context, course of performance, and customary practices to resolve ambiguities, as well as the common meanings of terms involved.
A court cannot consider uncommunicated subjective intent of the parties when interpreting a contract, as established in Wells v. Shearson Lehman/Am. Express, Inc. and reaffirmed in subsequent cases. Although the parties previously agreed that the Agreement was unambiguous, the Second Circuit found it ambiguous, necessitating consideration of both the Agreement's plain language and extrinsic evidence of intent regarding whether Abboud sold the exclusive commercial use of his name to JA Apparel.
The court examined the Agreement and the surrounding circumstances, concluding that Abboud did not sell his name. Key correspondence included a November 1999 letter from Abboud to GFT’s CEO, which referenced the sale of "all Joseph Abboud trademarks" without mentioning his personal name for commercial use. Further communications, including a December 1999 response from GFT and a meeting in Milan in February 2000, clarified that the deal focused solely on trademark acquisition. Subsequent letters detailed that JA Apparel would obtain rights to use the name "Joseph Abboud" only for specified products and would need Abboud's consent for other uses. A letter of intent later specified that JA Apparel was purchasing all rights related to the trademarks, including new trade names and service marks associated with "Joseph Abboud."
The letter of intent between Abboud and JA Apparel did not include the sale of "names." Disputes arose regarding the non-compete agreement, particularly for Abboud, who wanted to continue his career as an apparel designer after a five-year Personal Services period, while acknowledging he could not use the "Joseph Abboud" name or associated trademarks. On February 25, 2000, Fili emphasized JA Apparel’s goal of acquiring the trademarks. Abboud responded, expressing his desire to maintain the option to work after five years without any rights to the trademarks. His decision to relinquish his name was described as emotional.
On March 17, 2000, a letter agreement was signed, mirroring the earlier letter of intent, again omitting "names." JA Apparel later drafted an Agreement that included "names" as an asset for purchase, marking the first inclusion of the term in their communications. Abboud’s counsel proposed changes to the draft but did not address the term "names." Subsequent drafts continued to include it without further discussion. A draft press release noted the acquisition of trademarks and licensing agreements associated with Joseph Abboud but did not clarify that the "name" was to be sold as anything other than a trademark. At the sale's closing, Abboud assigned rights only related to the trademarks, not to his name apart from its trademark use. The final Agreement maintained the inclusion of "names" alongside other intellectual property, but there is no evidence of negotiations regarding the sale of Abboud’s name as a separate asset.
Despite extensive extrinsic evidence presented at trial, it provides minimal clarity regarding the intended meaning of "names" in the Agreement between the parties, who primarily aimed to negotiate the sale of trademarks and related intellectual property. Key communications, including letters and meeting minutes, consistently emphasize the sale of "all Joseph Abboud trademarks" and specify that only trademarks were the focus of the negotiations. The term "names" first appeared in a draft of the Agreement, without prior discussion, and neither party could explain its inclusion or meaning in the context of the transaction.
JA Apparel argues that Abboud's failure to object to the term in the draft signifies intent to include an additional distinct asset, while the Court found this silence insufficient for such an interpretation. JA Apparel also presents letters suggesting Abboud did not retain rights to use his name under the Agreement. A letter from Abboud's attorney noted that efforts to pursue apparel design could not include the name "Joseph Abboud" or any trademarks conveyed to JA Apparel. However, this letter also indicated that "Joseph Abboud" was referenced as a trademark.
Additionally, Abboud expressed in another letter his emotional struggle over relinquishing his name, yet simultaneously stated he would not retain rights to any Joseph Abboud trademarks and highlighted the need to separate his personal identity from the trademarks. The Court recognizes that both JA Apparel's and Abboud's interpretations of the Agreement are reasonable, aligning with the Second Circuit's previous conclusions.
The Court concludes that section l.l(a)(A) of the Agreement did not grant JA Apparel the exclusive right to use Abboud's name for commercial purposes outside of trademark or brand contexts. This determination is based on the lack of extrinsic evidence supporting JA Apparel's broader interpretation and the explicit focus on trademarks and related intellectual property in the Agreement. The Court acknowledges the potential for the term "names" to be viewed as redundant but emphasizes that all contractual provisions should be given effect, as per established legal principles. The interpretation aligns with the broader context of the Agreement, suggesting that "names" refers to brand or commercial names rather than granting exclusive rights to Abboud's personal name.
JA Apparel's trademark infringement claims arise from Abboud's intended use of his name in a clothing line, invoking Section 32 of the Lanham Act and New York common law. Abboud counters with a "fair use" defense and argues for protection under the First Amendment, asserting JA Apparel's claims are tainted by unclean hands. Although the Court finds that Abboud did not sell exclusive commercial rights to his name, it recognizes he sold his trademarks, including "Joseph Abboud." Consequently, if JA Apparel succeeds on its trademark claims, Abboud may face liability for both infringement and breach of contract.
To prove trademark infringement under Section 32(1) of the Lanham Act, a plaintiff must establish that their marks are valid and that the defendant's use is likely to cause consumer confusion regarding the origin or sponsorship of goods. Courts in this Circuit commonly apply the Polaroid factors to evaluate confusion, which include: the strength of the plaintiff's mark, similarity of the marks, proximity of the products/services, potential for market overlap, evidence of actual confusion, the defendant's bad faith, quality of the defendant's goods/services, and consumer sophistication.
In the case of Abboud I, the Court found substantial evidence supporting the strength of the Abboud marks, the close proximity of the goods, and instances of actual confusion, indicating a likelihood of confusion despite the "jaz" products not yet being marketed. The Second Circuit affirmed that the defendants conceded the validity of the 'Joseph Abboud' trademarks and acknowledged a prima facie case under the Polaroid test. Abboud's attempts to contest the likelihood of confusion were dismissed, leading the Court to focus on his fair use defense along with potential First Amendment and unclean hands defenses.
For the statutory fair use defense, which can serve as a complete defense against trademark infringement claims, the alleged infringer must prove that their use of the term is descriptive, not as a mark, and used in good faith to describe their goods or services or their geographic origin. Courts assess whether the term used meets these criteria. Abboud contends that he is not using his name as a trademark.
Joseph Abboud claims that phrases like “by the award-winning designer Joseph Abboud” are used descriptively to inform the public about products associated with his “jaz” trademark. A descriptive use of a mark occurs when it describes a characteristic of the goods, as established in legal precedents. The Second Circuit recognizes that descriptive use encompasses terms that are the only reasonable means of describing another’s goods and acknowledges that confusion arising from a defendant's descriptive use is a risk associated with the plaintiff’s choice of a descriptive mark. Courts assess whether a term is used as a trademark by examining if it indicates the source of consumer products. When a defendant’s use is accompanied by their own visible mark, it is typically not considered trademark use. Factors such as the prominence of a defendant’s mark relative to the descriptive term and the presence of measures to avoid confusion are taken into account. Bad faith may be demonstrated by intent to confuse consumers regarding the source or sponsorship of products, which can negate claims of good faith use. This analysis parallels the Polaroid factors, particularly regarding whether the defendant aimed to capitalize on the plaintiff's goodwill.
In the case Sports Auth. Inc. v. Prime Hospitality Corp., the court may evaluate the likelihood of confusion when addressing fair use defenses, referencing KP Permanent Make-Up, Inc. v. Lasting Impression I, Inc., which emphasizes that potential consumer confusion remains relevant even under fair use claims. A defendant can use their surname for advertising, as long as it is not overly intrusive, according to Madrigal Audio Labs, Inc. v. Cello, Ltd. Traditional evidence of confusion is permissible in classic fair use cases, and a defendant's knowledge of a plaintiff's federal registration does not automatically negate the fair use defense. However, courts may infer bad faith from a defendant's breach of a non-use agreement.
In surname cases, secondary meaning can turn a surname into a trademark, but it still serves to represent the individual's identity and achievements. Historically, individuals had an absolute right to use their names in business, but modern views have shifted to recognize limitations. Courts are cautious when a person who sold the rights to their name attempts to retain the benefits of that name while simultaneously violating the agreement. If an individual has sold their name's goodwill, subsequent use in a different context may not constitute fair use. A defendant who shares a surname with a plaintiff's trademark must navigate the complexities of prior agreements regarding surname use. The trial revealed uncertainty on the part of Abboud regarding how he could utilize his name in accordance with the Agreement.
JA Apparel presented mock-up advertisements created by designer Joseph Abboud as evidence at the trial. Abboud characterized these mock-ups as potential layouts for a concept, indicating he had not finalized their use. Despite his hesitance, the Court considered these materials relevant to understanding his intentions with the Joseph Abboud name in advertising. Toward the trial's conclusion, Abboud submitted two additional proposed ads, asserting they do not infringe on JA Apparel’s trademark rights and are relevant for the fair use analysis.
The Court determined that these two ads (Defendants’ Exhibits 187 and 188) do not use Abboud’s name as a trademark. The ads prominently feature the trademark "jaz" in a large font, while Abboud’s name appears in a smaller, less prominent font within a complete sentence: “JAZ IS A NEW LUXURY COLLECTION CREATED BY THE AWARD-WINNING DESIGNER JOSEPH ABBOUD.” Abboud’s name is positioned in a way that does not draw significant public attention and is not the focal point of the ads. The Court concluded that Abboud's use of his name in these exhibits is descriptive and non-trademark use, aimed at informing potential customers of his role as the designer.
In contrast, some earlier mock-ups, which Abboud did not fully endorse, displayed "Joseph Abboud" in a more prominent manner, raising questions about their characterization as descriptive uses. These mock-ups featured his name in block letters, sometimes in a font similar to JA Apparel’s registered trademark, which could suggest a trademark use rather than a descriptive one.
The Court evaluates the use of designer Joseph Abboud's name in advertisements. It finds that some mock-ups utilize Abboud’s name as a symbol to attract attention, moving beyond mere descriptive use, as supported by case law (Safeway Stores, 307 F.2d at 499). In contrast, Plaintiffs Exhibit 43 represents a clear descriptive, non-trademark use, where Abboud’s name appears in small text, accompanied by a disclaimer clarifying his lack of association with JA Apparel Corp., which owns the trademark "JOSEPH ABBOUD." This disclaimer helps mitigate potential confusion.
The Court examines Abboud’s fair use defense, specifically his good faith intent in using his name. Abboud claims that his restraint from advertising and seeking legal advice demonstrates good faith. However, the Court emphasizes that the analysis must focus on whether Abboud's proposed advertisement would confuse consumers regarding the source or sponsorship of the products. If it determines he intends to trade on JA Apparel's goodwill, he would fail the third fair use test factor (EMI Catalogue P’ship, 228 F.3d at 66).
The Court expresses concern over Abboud’s admissions, noting his intention to create a slogan that implies an affiliation with the “jaz” products, as well as his desire for his name to be prominently displayed to attract consumer attention. These intentions suggest a likelihood of confusion, especially without a disclaimer. Abboud’s goal to inform the public of his role as the “source” of the “jaz” line further indicates a potential for consumer confusion (KP Permanent Make-Up, 543 U.S. at 123).
Trademarks serve to identify the source of goods and services, a principle underscored by case law. Abboud's use of his name in connection with his "jaz" collection is significant, as it relates to consumer perceptions of his skills and reputation, which trademarks are intended to protect. Despite Abboud's arguments regarding fair use, he sold the Joseph Abboud trademark and its associated goodwill to JA Apparel for $65.5 million, relinquishing the right to claim fair use based on that reputation. Under New York law, a seller cannot retain the trade reputation for which they received compensation. Abboud may inform consumers that he is the designer of the "jaz" line, but he must do so without causing confusion or being overly intrusive. His situation is complicated by his prior use of his name as a trademark, as he now competes with the purchaser of the trademark. Although the case presents challenges due to potential consumer confusion, Abboud's use of his name can qualify for a fair use defense if accompanied by a disclaimer, as it is descriptive and contextualized within a complete sentence that identifies him as the designer, alongside the prominent "jaz" trademark.
The average consumer is likely to confuse clothing marketed under the Joseph Abboud mark with that designed by Joseph Abboud, limiting Abboud’s use of his name. His name cannot appear in advertising without a disclaimer clarifying that he is not affiliated with JA Apparel or the Joseph Abboud trademarks, as established in Levitt Corp. and Joseph Scott Co. This disclaimer must be as prominent as the use of his name. While a proposed ad in Plaintiffs Exhibit 43 could qualify for fair use due to its appropriate disclaimer and design, the ads in Plaintiffs Exhibit 42 do not meet the fair use standard. The size and font of "Joseph Abboud" in those ads closely resemble the trademark, creating confusion and suggesting that "jaz" is a sub-line from JA Apparel, which Abboud intended. Abboud's defenses related to fair use do not need to be further examined if his proposed uses are deemed to create confusion or act in bad faith, leading to trademark infringement and breach of contract. Relevant case law supports that confusion negates First Amendment defenses in trademark cases. The issue of unclean hands is irrelevant due to the dismissal of Abboud's counterclaims.
Plaintiffs assert remaining claims of dilution, false designation of origin, unfair competition, and false and deceptive trade practices under the Lanham Act and New York General Business Law, specifically related to Abboud’s intended use of his name for a new “jaz” line. The plaintiff is not seeking additional relief for these claims. Consequently, any further examination of these claims concerning Abboud’s name use is deemed unnecessary for advertisements that do not constitute fair use. The court notes that since the plaintiff has won the infringement claim, further analysis of the dilution claim is not needed, as no additional relief is sought. Trademark infringement is categorized within unfair competition, and both claims share similar elements. Abboud's use of his name may qualify as fair use, thus shielding him from liability regarding the remaining claims. Fair use serves as a defense against both federal dilution claims and New York dilution and common law trademark claims. The court asserts that claims of purely descriptive use of a mark can prevent recovery in common law unfair competition cases.
Regarding permanent injunctive relief, the Second Circuit highlighted that the original injunction may have been overly broad if solely based on trademark infringement. Since the court has found that Abboud did not transfer exclusive rights to use his name commercially, the injunction must be adjusted to target only those uses that infringe on trademark rights and are not protected under the fair use defense. The court will not elaborate on the standard for injunctive relief, which remains consistent with prior rulings. Injunctions in cases involving personal names should be narrowly defined, especially when the defendant intends to establish a business using their own name, as courts typically hesitate to restrict all surname usage.
In cases where the infringing party has previously sold their business, including their name and goodwill, courts find sweeping injunctive relief more acceptable. The court must aim to prevent marketplace confusion, protect a company’s property interest in its name, and allow individuals to legitimately exploit their identity. Consequently, JA Apparel is granted a permanent injunction against Abboud, prohibiting him from using his name as a trademark or brand in connection with “jaz” products. If Abboud uses his name in promotional materials, it must be in a descriptive manner, fitting within a complete sentence or phrase, and visually subordinate to surrounding text. Additionally, Abboud must display the trademark “jaz” prominently to indicate the source of the clothing line and minimize confusion. Any use of his name must include a disclaimer of affiliation with JA Apparel, displayed in a font size that matches the text.
Abboud's counterclaims against JA Apparel and staff include allegations of false endorsement, false advertising, violations of New York laws, and common law unfair competition, all stemming from JA Apparel's promotional activities after their agreement. He seeks $37.5 million in damages, which he claims represents a 10% royalty on JA Apparel's wholesale sales since July 2005. However, the court previously concluded that these counterclaims were based on a rejected premise that JA Apparel did not acquire exclusive rights to the Joseph Abboud name. Although the court on remand reached a different conclusion regarding the agreement, much of the prior analysis remains valid, leading to the dismissal of the counterclaims. Even if the defendants had succeeded, they failed to substantiate any damages adequately.
Defendants failed to demonstrate any profits arising from the allegedly objectionable advertising campaigns, which the Court deemed insufficient to support their damage calculations. Abboud's first counterclaim, under Section 43(a) of the Lanham Act, alleges that Plaintiff violated his right of publicity by misleading consumers into believing that he was still associated with JA Apparel. In his third counterclaim, under New York Civil Rights Law Sections 50 and 51, Abboud asserts that his name was used in promotional materials without his consent. However, the court found that Defendants did not provide credible evidence that consumers were misled into thinking the advertising campaigns indicated an association with the individual Joseph Abboud rather than the brand.
For his state law claim, Abboud needed to prove that JA Apparel used his name for advertising without consent, but he failed to show that anyone believed the names "Joe" or "Joseph" referred to him. The court noted that the responses to the campaign questions indicated they were coming from the "Joseph Abboud Design Staff," not from an individual. Furthermore, the character "Joe" was portrayed as a fictitious entity aimed at younger consumers, distinct from the established "Joseph Abboud" brand. Abboud also sold the rights to use his name in trademarks to JA Apparel, granting the necessary consent. Consequently, both the Lanham Act and state law claims must be dismissed as Abboud did not provide sufficient evidence to support his allegations.
JA Apparel's abandonment of trademark applications and advertising campaigns does not weaken Abboud's claims regarding the use of his name, as JA Apparel purchased the rights to the Abboud name. Consequently, Abboud's third counterclaim is dismissed. In his second counterclaim under the Lanham Act, Abboud alleges that JA Apparel's advertising creates a false impression of his association with the brand and his reputation as a designer. However, similar to findings in a prior case (Abboud I), the court dismisses this claim, noting that Abboud failed to demonstrate that JA Apparel's statements were false or that consumer confusion existed.
In his fourth and fifth counterclaims, Abboud accuses JA Apparel of deceptive business practices and unfair competition based on the same conduct. The court reiterates its previous conclusion that the advertising campaigns were not misleading, that there was no credible evidence of consumer injury, and that JA Apparel acted in good faith by using the Abboud name. Abboud did not establish that JA Apparel's actions were materially deceptive or that he suffered injury as a result. Additionally, the New York General Business Law 349 aims to protect consumers from deceptive practices affecting the public at large, not to resolve private contract disputes. Since JA Apparel believed it had the right to use the Abboud name, Abboud's counterclaim for unfair competition is also dismissed.
Recovery is precluded unless defendants demonstrate bad faith. The Court dismisses the fifth counterclaim regarding JA Apparel’s alleged wrongful attempts to disrupt Abboud’s new ‘jaz’ line, noting the evidence was insufficient and that such claims do not constitute unfair competition under New York law. Unfair competition claims are treated similarly to trademark infringement under the Lanham Act, and defendants failed to support their position that interference with business relations qualifies as unfair competition, as they did not assert a tortious interference claim. Consequently, all counterclaims from the defendants are dismissed.
The Court clarifies several key points: 1) Abboud sold the trademark and related intellectual property of the “Joseph Abboud” name, not the exclusive commercial rights. 2) Abboud’s intended use of his name for the “jaz” line may qualify as fair use under the Lanham Act, provided he includes a disclaimer of affiliation with JA Apparel in advertising. 3) However, specific uses of his name related to the “jaz” line could infringe trademarks under the Lanham Act, violating the Purchase and Sale Agreement. 4) Plaintiffs’ claims for dilution, unfair competition, and false designation of origin are dismissed, as are defendants' counterclaims related to publicity rights and unfair competition.
Finally, Abboud is permanently enjoined from using his name in any capacity associated with Houndstooth or any other affiliated entity.
1. Abboud is prohibited from using his name as a trademark, service mark, trade name, or brand name in relation to "jaz" clothing, labels, hang-tags, or product packaging.
2. His name can only be used descriptively in promotional materials, within a complete sentence or descriptive phrase, and must not be larger or more distinct than the surrounding text.
3. Abboud must prominently feature his trademark "jaz" or any other trademark on any advertisement that includes his personal name.
4. If Abboud uses his name as outlined in Defendants’ Exhibit 187 and 188, he must include a disclaimer noting no affiliation with JA Apparel and its Joseph Abboud trademarks, with the disclaimer text matching the size of the surrounding text.
5. Judgment will be entered consistent with these terms, following the Court's prior findings in Abboud I, where it was established that Abboud breached non-competition obligations during the Restricted Period, but no damages were assessed.
6. The parties agreed on New York law governing the Agreement, which did not limit Abboud's trademarks to a specific industry.
7. Although a letter from Vigitello suggests that certain rights regarding Abboud's name were reserved, neither party emphasized this letter during the trial.
8. The Agreement specifies that any ambiguities should be interpreted as if jointly drafted by both parties, negating any presumptions based on authorship.
9. The Court previously ruled that the non-assignment of Abboud's name does not definitively indicate a sale of his name to JA Apparel, but now considers extrinsic evidence of the parties' intent relevant to the overall interpretation of the Agreement.
Extrinsic evidence submitted by the parties, including trial testimony regarding subjective interpretations of the contract, is deemed largely self-serving and of little relevance to the Court's analysis, leading to its exclusion from the summary. Both parties recognize that subjective understandings not communicated to the opposing side cannot be considered as extrinsic evidence. The issue of "logos, insignias, and designations" is acknowledged as part of the trademark categories listed in the agreement, highlighting a lack of clarity regarding the parties' rights under the Agreement despite the complexities surrounding Abboud's future use of his name.
The Court notes that the standards for trademark infringement under the Lanham Act and similar state law claims are aligned. Abboud's introduction of the "nominative fair use" doctrine is critiqued as inappropriate, as this defense applies only when a defendant uses the plaintiff's mark to describe the plaintiff's product, not their own. JA Apparel's acquisition of the surname trademark carries minimal risk due to the uniqueness of "Joseph Abboud," which, while descriptive, also possesses an arbitrary quality.
Abboud's prior argument that he should not be subject to the likelihood of confusion test because he intends to use his name descriptively is rejected by the Court. A conference was held post-remand to clarify the parties' positions, where JA Apparel's counsel expressed challenges in defining Abboud's intended use of mock-up advertisements. Abboud's counsel countered, advocating for legal parameters rather than being restricted to record exemplars. The Court intends to address hypothetical future uses as necessary.
The remaining advertisements in Plaintiff's Exhibit 42 are deemed sufficiently similar to the primary exhibit, making their addition unnecessary. Defendants' Exhibit 188 mirrors Exhibit 187, with the only difference being the inclusion of a promotional phrase asserting the "jaz" line as an expression of classic style by designer Joseph Abboud. This phrase, while identifying Abboud as the designer, raises concerns about potential trademark implications. Abboud's intent to use this phrase in advertising suggests a trademark use rather than merely a descriptive one. Given that he has sold the rights to register similar expressions as trademarks to JA Apparel, it would be prudent for Abboud to adopt diverse descriptive phrases instead of a singular tagline. The Second Circuit's interpretation of Abboud's use of his name was misrepresented; the Court did not indicate that Abboud aims to differentiate his clothing from JA Apparel but rather to set it apart from other competitors by leveraging the goodwill associated with the Joseph Abboud trademark. Abboud proposed limitations on his name's usage in his post-trial submissions. Consequently, the Court dismisses the Defendants’ "unclean hands" defense regarding JA Apparel’s marketing strategies involving the Joseph Abboud name.
