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July 1, 1986

DONALD J. TRUMP, Plaintiff,

Debevoise, District Judge.

The opinion of the court was delivered by: DEBEVOISE

THE COURT: Good afternoon.

 What I will do is put an opinion on the record and reserve the right to review the transcript and make any corrections or changes in form which I think are needed.

 The question presented in this case is whether plaintiff, Donald J. Trump, a person of renown in the real estate field, can name one of his two Atlantic City casinos "Trump's Palace" over the objections of defendant, Caesars World, Inc., which has long operated a famous casino in Las Vegas, Nevada under its trademark "Caesars Palace" and which now also operates a casino in Atlantic City called "Caesars Atlantic City."

 I. Procedural Background

 On March 17, 1986 Trump filed a complaint seeking injunctive relief and declaratory judgment that his use of the name "Trump's Palace" would not constitute infringement of Caesars World's trademarks under the Lanham Act. Caesars World counterclaimed and moved for an order preliminarily enjoining Trump from naming his newest Atlantic City casino "Trump's Palace." The parties took extensive discovery and a hearing on Caesars World's motion was held on June 18 and 19, 1986. With the consent of the parties I ordered that the trial of the action on the merits be advanced and consolidated with a hearing on the preliminary injunction application. F.R. Civ. P. 65(a)(2).

 This opinion constitutes my findings of fact and conclusions of law.

 II. The Facts

 A. Caesars World. Caesars World, through subsidiaries, is in the business of providing casino hotels and resort hotels. The most illustrious of its enterprises is Caesars Palace in Las Vegas, Nevada.

 The image which Caesars Palace seeks to convey is suggested by a release (Exh. P-67) which commences: "Glittering at the heart of the Las Vegas Strip, Caesars Palace recaptures the glory that was Greece and the grandeur that was Rome in a resort casino that has become synonymous with luxury and excitement. Graced by spectacular fountains, beautiful landscaping and gleaming marble reproductions of classic statuary, Caesars Palace sits as an architectural marvel among world resorts famous for their originality and beauty."

 Encompassed in this 85-acre setting is the Omnimax, a 380-seat luxury movie theater, a 243,000-gallon pool situated in The Garden of the Gods, a 28-foot jacuzzi, 1,600 luxurious rooms and suites, seven restaurants, including the Bacchanal which features a seven-course feast where exotically clad "wine goddesses" pour vintage wines from shoulder height and Cleopatra's Barge, an imposing floating cocktail lounge that is a replica of the majestic ships that sailed the Nile in ancient Egypt. The purpose of all this is to attract gamblers to the casino who will contribute to the casino's "Win," i.e. the customer's loss. In addition to the physical facilities, Caesars Palace brings to its theaters and entertainment halls celebrities of show business such as Bill Cosby, Diana Ross, Joan Rivers, Julio Iglesias and The Pointer Sisters. It features sporting events such as boxing bouts and tennis matches with such stars as Muhammed Ali and John McEnroe.

 The decor of Caesars Palace is informed by a so-called "Greco-Roman" theme. The name Caesars Palace and other titles and prominent words are often written in letters having a peculiar chiseled block style which is supposed to be suggestive of Roman writing. Areas in the complex are given names associated with ancient Rome. The logo on the letterhead pictures a slave girl feeding grapes to a reclining emperor. The statues placed at strategic locations are reproductions of such works as Winged Victory of Samothrace. There was some confusion in the testimony whether one of the statues represented Julius Caesar, Caesar Augustus or Marcus Aurelius, but while Nero or Caligula might better represent the spirit of the enterprise, Caesar, Caesar Augustus and Marcus Aurelius are each indisputably Roman.

 At times Caesars Palace must stretch a bit to maintain its Roman theme. One of its statues is a reproduction of Michelangelo's David, but this perhaps can be justified on the basis that the Roman Empire flourished at some mid-point between young David's slaying of Goliath in the Valley of Elah, and Michelangelo's sculpting his statue in the 16th Century. Harder to conceptualize is the linkage of the Chinese restaurant to ancient Rome. Caesars' Howard Klein made a valiant effort, testifying, "We have a story in the menu as to the connection, the ancient connection between trade between China and the Roman Empire utilizing Marco Polo as the interlock." Klein deposition at 94. No matter that the interlock Marco Polo and his uncle commenced their journey from Venice to China 800 years after the fall of the Western Roman Empire.

 In addition to its ultimate creation, Caesars Palace in Las Vegas, Caesars World operates a casino-hotel in Lake Tahoe, Nevada under the name Caesars Tahoe.

 In 1977 Caesars World commenced planning its Atlantic City project. It acquired the Hotel Traymore site on the Boardwalk and planned to create a facility which would merit the name Caesars Palace. Unfortunately, necessary financing was not available and the project was put on the back burner. In order to make a quick entry into Atlantic City, however, Caesars World acquired the Howard Johnson Regency property, also on the Boardwalk, and developed quickly a more modest casino hotel - so modest in fact that at the outset it was not permitted to bear either the name "Palace" or the name "Caesars." It had to commence its life under the humble appellation "Boardwalk Regency Hotel Casino." In 1981, after some upgrading was accomplished, the name was changed to Caesars Boardwalk Regency Hotel Casino.

 Since 1971 Caesars World has been the owner of trademarks and service marks used in the promotion and advertising of its casino hotels and resort properties. These trademarks are registered in the United States Patent and Trademark Office. They include "Caesars Palace" and "The Palace" and have achieved incontestable status under 15 U.S.C. Section 1065.

 Caesars World has expended substantial effort both in the United States and abroad promoting its marks and marketing its various casino and resort hotel services. During the past five years it and its subsidiaries have spent approximately $8 million per year in advertising promotions and marketing efforts.

 Caesars Palace advertises extensively in print, poster, broadcast media under the name Caesars Palace. It also advertises frequently using such expressions as "Play the Palace," "Plunder the Palace" and other expressions using the words "The Palace."

 In addition to vigorously advertising and promoting its marks, Caesars Palace and The Palace, as applied specifically to the Caesars Palace facility in Las Vegas, Caesars World has marketed its several properties in such a way as to foster the association between Caesars Palace and the other properties. Caesars Palace, Caesars Tahoe and Caesars Atlantic City all use the same distinctive Roman-type lettering originally devised for Caesars Palace. They share joint sales offices, both domestic and international. The properties are often marketed through joint advertising pieces that describe several of the properties. In marketing the casino facilities to international clients, Caesars World has come to refer to each of its casino properties as "Caesars Palace" because that accords with the perceptions of the patrons themselves.

 In fiscal 1986, in excess of $8 million has been budgeted by Caesars Atlantic City alone for advertising and promotion. In its advertising, Caesars Atlantic City attempts to benefit from what its attorneys refer to as the "halo effect" generated by Caesars Palace. There are linkages between Caesars Atlantic City and Caesars Palace, including: sporting events originating at Caesars Palace, which is shown in Caesars Atlantic City on closed-circuit TV; Caesars World in-house publication, Seven Magazine which is sent to 100,000 customers or potential customers of all three casino hotels and which describes the offerings of all three of them; advertisements for Caesars Atlantic City featuring comedian Buddy Hackett as Caesar in a palace, and a Roman charioteer bringing patrons to Caesars; use of the same Roman-style lettering in the word Caesars; the offer of trips to Caesars Palace as prizes in contests run at Caesars Atlantic City; installation of many Roman-type statues and other elements of decor similar to that found at Caesars Palace; use of a seal with Roman figures on stationery, matchbooks, interior signage and other items is virtually identical to the seal used at Caesars Palace; use of "Pig Latin" in radio advertising; and reliance upon joint advertising and promotion both within this country and abroad.

 On some occasions the commingling of the advertising and programs of the various Caesars World casino/hotels has resulted in references by customers and entertainers to the Atlantic City facility as Caesars Palace in Atlantic City.

 At its outset, in the late 1960s Caesars Palace in Las Vegas sought as customers primarily the high rollers, domestic gamblers willing to place bets of $25,000 or more and international gamblers willing to place bets of $50,000 or more. Starting in the mid-1970s a concentrated effort was made to entice the international trade through personal solicitation of customers abroad, free airplane trips and glamorous accommodations, food, drink and entertainment at the casino hotel.

 In 1982 Caesars World made a policy change and its three casino hotels started making a concentrated effort to attract not only the high rollers but also the middle and lower level players. There was no change, however, in the advertising and promotional efforts to portray these facilities as luxurious, glamorous places redolent with an aura of a cartoonist's view of ancient Rome and Greece.

 At Caesars Palace in Nevada the total annual "win" is $240 million, of which $40 million is represented by slot machine win and sports and race book win. The remaining $200 million is in table game revenue. About 45 percent of the table game revenue comes from international customers. About 75 percent of table game win at Caesars Palace comes from domestic and ...

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