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Serenity Springs, Inc. v. Laporte County Convention

Court of Appeals of Indiana

July 16, 2014

SERENITY SPRINGS, INC. and LAURA OSTERGREN, Appellants-Defendants,
v.
THE LAPORTE COUNTY CONVENTION AND VISITORS BUREAU, by and through its Board of Managers, Appellee-Plaintiff

APPEAL FROM THE LAPORTE SUPERIOR COURT. The Honorable William J. Boklund, Judge. Cause No. 46D04-1101-MI-1.

ATTORNEY FOR APPELLANTS: JONATHAN A. WATSON, Passaro, Kahne & Taylor, Benton Harbor, Michigan.

ATTORNEY FOR APPELLEE: MICHAEL S. BERGERSON, Law Office of Michael S. Bergerson, Michigan City, Indiana.

MAY, Judge. VAIDIK, C. J., concurs. RILEY, J., concurs in part and dissents in part.

OPINION

Page 488

MAY, Judge

Serenity Springs appeals a judgment in favor of the LaPorte County Convention and Visitors Bureau (" the Bureau" ) that permanently enjoined Serenity Springs from using the internet domain name visitmichigancitylaporte.com and transferred the domain name to the Bureau. As " Visit Michigan City LaPorte" was not a protectable trade name and Serenity Springs' use of it was not unfair competition, we reverse.

FACTS AND PROCEDURAL HISTORY

We set forth the facts underlying this appeal in Serenity Springs v. LaPorte Cnty. Convention & Visitors Bureau, 986 N.E.2d 314, 317-19 (Ind.Ct.App. 2013) (hereinafter " Serenity Springs I " ):[1]

The Bureau . . . is " the official destination marketing organization that represents the visitor industry and communities to create economic growth from visitor expenditures." The Bureau's goal is to increase tourism in LaPorte County, and in doing so, the Bureau

Page 489

promotes a number of hotels and attractions in the area. Serenity operates a hotel resort in LaPorte County, which is one of the businesses promoted by the Bureau.
In early 2009, the Bureau contracted with a private marketing firm to conduct a branding study for the purposes of identifying new and better ways to promote tourism in the area. On September 9, 2009, the Bureau held a public meeting at which the results of the branding study were announced, and a representative of Serenity was in attendance. The Bureau's representatives announced that the phrase " Visit Michigan City LaPorte" had been identified as the branding identifier for the area.
Immediately after the meeting, an employee of Serenity registered the domain name " visitmichigancitylaporte.com" at [the owner's] behest and set it up to redirect internet traffic to Serenity's website. Later that day, an employee of the Bureau attempted to register the same domain name, but discovered that it had already been purchased and was being used to direct internet traffic to Serenity's website. The Bureau was able to register a number of similar domain names, including visitmichigancitylaporte.org, visitmichigancitylaporte.net, and michigancitylaporte.com.
Thereafter, the Bureau sent a cease-and-desist letter to Serenity claiming that Serenity had infringed its trademark and committed cybersquatting by registering visitmichigancitylaporte.com. Serenity responded that it had been unable to find any federal or state trademark registrations for Visit Michigan City LaPorte and further claimed that (1) Serenity had not committed trademark infringement because it registered and began using the visitmichigancitylaporte.com domain name before the Bureau made any commercial use of the designation Visit Michigan City LaPorte, and (2) that the designation was not protectable as a trademark because it was merely descriptive and had not acquired distinctiveness.
On April 29, 2010, the Bureau filed an application with the Secretary of State to register " 'Visit Michigan City LaPorte' and logo" as a trademark under the Indiana Trademark Act. In its application, the Bureau indicated that the mark was first used in commerce on September 9, 2009, and disclaimed any rights to the words " Michigan City" or " LaPorte." The Bureau received a certificate dated May 13, 2010 indicating that " Visit Michigan City LaPorte" had been registered as a trademark with the Secretary of State. The certificate also indicated that the mark was first used on September 9, 2009, and the words " Michigan City LaPorte" had been disclaimed.
On May 26, 2011, the Bureau sent another cease-and-desist letter to Serenity, again asserting that Serenity was infringing its rights in the now-registered trademark. The Bureau attached a copy of the certificate of trademark registration to the letter and informed Serenity that the letter would be its final attempt to resolve the matter before taking legal action.
Serenity sent a response letter to the Bureau on June 1, 2010. In the letter, Serenity again asserted that it was the first party to use the mark in commerce, and argued further that the Bureau's registration of the mark did not affect Serenity's common-law rights to use the mark or confer retroactive trademark rights. Serenity stated that it was willing to assign the domain name to the Bureau if it could provide proof that it first used the mark in commerce on or

Page 490

before September 9, 2009. Serenity argued that if the Bureau had not used the mark in commerce by that date, it had fraudulently misrepresented the date of first use on the application for trademark registration, which would result in cancellation of the registration.
On January 4, 2011, the Bureau filed a complaint against Serenity alleging trademark infringement, cybersquatting, and unfair competition. The Bureau also sought and obtained a preliminary injunction prohibiting Serenity from using the domain name. The matter proceeded to a bench trial on March 8, 2012, and the trial court entered judgment in favor of the Bureau on May 1, 2012. The trial court concluded that Serenity had violated Indiana law by committing trademark infringement and " cybersquatting that approaches cyberpiracy[.]" The trial court permanently enjoined Serenity from using the Visit Michigan City LaPorte designation or the domain name visitmichigancitylaporte.com, and further ordered Serenity to transfer the domain name registration to the Bureau.

(Citations and footnote omitted.)

In Serenity Springs I, we determined the designation " Visit Michigan City LaPorte" was not subject to protection because it was merely descriptive of the geographic location of the goods and services the Bureau promotes, and it had not acquired a secondary meaning through actual use of the mark prior to Serenity Springs' first use. Id. at 325. As the Bureau had asserted additional claims, including common-law unfair competition, that the trial court had not yet addressed, we remanded. Id. at 327.

On remand, the trial court found Serenity Springs had committed seven common-law torts: common-law trade name infringement, a common-law tort based on Serenity Springs' intent to deceive, common-law acts amounting to cybersquatting, unfair competition in the form of conversion of intangible value, tortious interference with a contract or business relationship, tortious behavior in the nature of " palming off," [2] and general unfair competition. It permanently enjoined Serenity Springs from using the mark " Visit Michigan City LaPorte" or the domain name visitmichigancitylaporte.com. The case now before us is an appeal from the trial court's decision on remand.

DISCUSSION AND DECISION

The trial court sua sponte entered findings of fact and conclusions of law. When the trial court enters such findings sua sponte, the specific findings control only as to the issues they cover, and a general judgment standard applies to any issue on which the court has not entered findings. Scoleri v. Scoleri, 766 N.E.2d 1211, 1214-15 (Ind.Ct.App. 2002). In reviewing the judgment, we determine whether the evidence supports the findings and the findings support the judgment. Id. at 1215. We will reverse only when the judgment is clearly erroneous, i.e., when it is unsupported by the findings of fact and conclusions entered on the findings. Id. For findings of fact to be clearly erroneous, the record must lack probative evidence or ...


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