By Joseph E. Samuel, Jr.
The Brooklyn Nets have sued headphone manufacturer Monster, Inc. in federal court for trademark infringement. The Nets allege that Monster breached a sponsorship agreement by failing to pay royalties, and then infringed the Nets’ trademarks by continuing to use the team’s name, logo, and the logo of the Nets’ arena.
On April 20, 2018, attorneys for the Nets filed a complaint in the U.S. District Court for the Southern District of New York. Brooklyn Events Center LLC, which operates the Barclays Center where the Nets host their games, also joined the complaint as a plaintiff. The complaint alleged trademark infringement under the Lanham Act and New York common law, along with breach of contract, false designation of origin, and unfair competition. The complaint sought a number of remedies, including a judgment of $560,000 in damages, a finding of wrongful conduct resulting in treble damages, an injunction to prevent further use of the trademarks, and reasonable attorney’s fees.
According to the complaint, Monster entered into an agreement on March 13, 2017, where it would become the “Official Headphone Sponsor of the Brooklyn Nets.” Under the agreement, Monster was allowed to put the names and logos of the Nets and Barclays Center on Monster headphones. In exchange, Monster was allegedly required to pay licensing fees totaling $280,000 per year and a commission of 20 percent of net sales if Monster sold at least $280,000 in gross revenue in a given year.
The Nets allege that Monster never made any of the payments that were due under the agreement, and so the Nets terminated the deal on Oct. 26, 2017. Notice was allegedly sent to Monster along with a demand for the $380,000 that was due at that time. According to the complaint, Monster continued to use the Nets and Barclays Center trademarks after the deal was terminated, including at the Consumer Electronics Show in Las Vegas in January 2018. After several cease and desist letters, the Nets initiated this lawsuit on April 20, 2018.
Five counts are alleged by the Nets. A breach of contract claim alleges that Monster failed to make the payments it owed. Next, the Nets assert trademark infringement under the Lanham Act, 15 U.S.C. § 1114(1)(a), because the continued use of the names and logos creates a likelihood of confusion amongst consumers. The Nets also claim trademark infringement under New York common law. The last two causes of action claim false designation of origin and unfair competition under 15 U.S.C. § 1125(a), and unfair competition under New York common law.
The Nets served Monster with the complaint on May 10, giving the defendants until May 31 to file an answer. As of June 5, that answer had not been filed, so Judge Vernon S. Broderick ordered that Monster had until June 15 to file or else the Nets could seek a default judgment. At the time this article went to press, that answer had still not been filed. In the event no answer is filed the Nets would have until June 29 to seek a default judgment.
This is not the first time the Nets have needed to defend their trademark in federal court. In 2013, the team successfully shut down a website using the URL “www.brooklyn-nets.tv.” A Bronx company named Cyberville Corp. argued that it could use that URL because the Nets had not been in Brooklyn long enough to establish prior use. The U.S. Patent & Trademark Office disagreed, saying that the mark “Nets” was sufficient to establish infringement.
The Nets have also been involved in trademark disputes with the Los Angeles Dodgers, who previously played in Brooklyn. In 2014, the Dodgers appeared in the Patent & Trademark office on two occasions to block the Nets, who were trying to use the marks “BROOKLYNHOOPS” and “BrooklynTaste.”
Brooklyn Events Center LLC, et al., v. Monster, Inc.; S.D.N.Y.; Case No. 1:18-cv-03525-VSB
Attorneys of Record (for plaintiffs) Justin Evan Klein, ROBINSON BROG LEINWAND GREENE GENOVESE & GLUCK PC, New York, NY. (for defendants) Todd J. Manister, SICHENZIA ROSS FERNCE KESNER LLP, New York, NY.
Joseph E. Samuel, Jr. is a rising third-year law student at Villanova University Charles Widger School of Law, where he is an online editor of the Villanova Law Review. He is currently working as a summer associate at Montgomery McCracken Walker & Rhoads during the summer of 2018. Previously, he served as a judicial extern for the Honorable Elizabeth T. Hey of the United States District Court for the Eastern District of Pennsylvania.
