The opinion of the court was delivered by: Brown, Chief Judge
This matter comes before the Court upon the motion for a preliminary injunction (Doc. No. 39) of the plaintiff The Katiroll Company, Inc., ("Plaintiff"). The defendant Kati Roll and Platters, Inc. ("Defendant") opposes the motion. The Court has considered the parties' submissions and considered the evidence and argument at an evidentiary hearing held on October 21 and 22, 2010. For the reasons that follow, the Court will grant the preliminary injunction in accord with these findings of fact and conclusions of law.
This litigation involves fast food, specifically the katiroll, a type of street food that originates from India. Both Plaintiff restaurant, The Katiroll Company, Inc., and Defendant restaurant, Kati Roll and Platters, Inc., sell this type of food. This litigation began on March 3, 2010, when Plaintiff filed a complaint in the Southern District of New York, alleging causes of action for trademark infringement, trade dress infringement, and unfair competition. (Compl.; Doc. No. 1.) Thereafter, the Southern District of New York ordered that this matter be transferred to the District of New Jersey based on the lack of personal jurisdiction in New York. (Memorandum Order dated July 9, 2010; Doc. No. 31.)
Plaintiff filed the instant motion for a preliminary injunction on August 27, 2010. (Doc. No. 39.) After receiving both the opposition and reply briefs and all the supporting documents, the Court held an evidentiary hearing on October 21 and 22, 2010. For the reasons stated below, the Court will grant Plaintiff's motion for a preliminary injunction. This opinion constitutes this Court's findings of fact and conclusions of law pursuant to Federal Rule of Civil Procedure 52(a).
The grant of injunctive relief is an "extraordinary remedy, which should be granted only in limited circumstances." Frank's GMC Truck Center, Inc. v. General Motors Corp., 847 F.2d 100, 102 (3d Cir. 1988) (citing United States v. City of Philadelphia, 644 F.2d 187, 191 n.1 (3d Cir. 1980)). When deciding such a motion, a court must consider four factors: (1) the moving party's likelihood of success on the merits; (2) the probability of irreparable injury to the moving party in the absence of relief; (3) the potential harm to the non-moving party; and, if applicable, (4) the public interest. Fechter v. HMW Indus., Inc., 879 F.2d 1111, 1116 (3d Cir. 1989) (citing United States v. Price, 688 F.2d 204, 211 (3d Cir. 1982)). "Only if the movant produces evidence sufficient to convince the trial judge that all four factors favor preliminary relief should the injunction issue." Opticians Ass'n of America v. Independent Opticians of America, 920 F.2d 187, 192 (3d Cir. 1990) (citing ECRI v. McGraw-Hill, Inc., 809 F.2d 223, 226 (3d Cir. 1987)).
The Court finds the following facts to be true and credible. Plaintiff "owns United States Service Mark Registration No. 3,352,040 [(the "Mark")] for THE KATI ROLL COMPANY, for restaurant and carry-out restaurant services in Class 43 and rights in unregistered trade dress." (Pl.'s Br. at 2; Doc. No. 39-1 (citing Saha Decl. ¶¶ 4-8).) Payal Saha is the president of Plaintiff company. Plaintiff opened its first location in June 2002 and currently operates two restaurants in Manhattan and one in London. (Id. at ¶ 2.)
Plaintiff's first location was opened at 99 MacDougal Street in Manhattan, the second location opened was opened at 140 West 46th Street in Manhattan in 2005 but in 2007 was moved to 49 West 39th Street, and the third location was opened in 2008 in London. (Saha Decl. ¶ 2.) Plaintiff serves "Indian fast food wraps consisting of one or more fillings such as seasoned kebab meats, eggs, cheese, vegetables and potato wrapped inside an Indian flatbread," which are "prepared on a griddle," and cost between $3.25 and $6.25. (Id. at ¶ 3.)
Plaintiff's stores are decorated in "an orange color scheme including orange interior and exterior surfaces, orange signage, a menu with an orange background and orange decorative elements." (Id. at ¶ 5.) Each store also has "an unpainted red brick wall" and "light brown 12" square ceramic tile[s] on the floor." (Id.) In addition, the layout of each of Plaintiff's locations "features an open glass front with windows unobstructed by cafe curtains or other coverings, limited seating in front with the counter further back and an open kitchen plan" and although limited seating is available, the restaurants are generally small and "geared to take-away business." (Id. at ¶ 7.)
Plaintiff's restaurants have received substantial press acclaim, and exposure in print, online, and among consumers. When Plaintiff opened its first location, "[s]everal well-known New York publications lavished immediate critical acclaim on The Kati Roll Company." (Id. at ¶ 9.) Time Out New York, for example, featured Plaintiff in 2002, and to date has given Plaintiff three awards. (Id.; Ex. 2.) In addition, New York Magazine and the Village Voice featured Plaintiff in articles in July 2002. (Id. at ¶ 10; Ex. 3.) The Daily News also wrote about or mentioned Plaintiff in articles in 2008. (Id.) Travel and Leisure included Plaintiff in a poll for "World's Best" for New York (id. at ¶ 11; Ex. 4), and India Today International featured a cover story in 2005 about the location (id. at ¶ 12; Ex. 5). Plaintiff "expended significant resources to foster and maintain press interest in its popular stores." (Id. at 3.) Plaintiff also "maintains a website with information about its products and stores at http://www.thekatirollcompany.com." (Pl.'s Br. at 3.) In addition to this press and publicity, reviews and fan pages are available on websites such as Facebook and Yelp. (Id. at 14.) Saha, President of Plaintiff, asserts that "The Kati Roll Company [is] a widely recognized brand in the U.S. and abroad." (Id.)
Saha credibly stated, "[i]n 2007 Niraj Jivani and his uncle requested a meeting with me. We met in person at [Plaintiff's] Manhattan office. [They] proposed opening a branch or franchise of The Kati Roll Company in New Jersey. After considering the offer, [Plaintiff] declined." (Id. at ¶ 17; Oct. 21, 2010 Tr. 11:20-12:17.) Niraj Jivani, principal shareholder of Defendant, acknowledges such a meeting that lasted "approximately ten minutes with Plaintiff's principal to discuss the possibility of Plaintiff franchising its restaurant" to Jivani. (Jivani Decl. at ¶ 10; Oct. 21, 2010 Tr. 22:4-22:22.) Jivani stated he learned about Plaintiff company from "word of mouth" and knew that they served katirolls. (Oct. 21, 2010 Tr. 19:7-19:11; 19:19-20:13.) The meeting occurred at Plaintiff's West 46th Street location in the office above the restaurant. (Oct. 21, 2010 Tr. 14:3-14:14.) After the meeting, Jivani looked into the restaurant on his way out, and he noticed the orange coloring. (Oct. 21, 2010 Tr. 18:1-18:13.) Therefore, the Court finds that Jivani had knowledge that Plaintiff company had orange awnings and had orange and white as its theme colors. (Oct. 21, 2010 Tr. 35:13-35:18.) Jivani agrees that "Plaintiff rejected the proposal" and that he therefore "continued with [his] plans to open a restaurant." (Id. at ¶ 12.)
The space that Jivani leased is located on Easton Avenue, New Brunswick, New Jersey. (Jivani Decl. at ¶¶ 1-6, 9; Doc. No. 46-1.) Jivani asserts that "[t]he space that was available is situated among a row of restaurants on Easton Avenue" and that "[t]he space is small and has an open face window facing the street, together with an exposed brick wall on one side of the space." (Id. at ¶ 7.) The inside layout existed prior to Defendant opening in the space, as did an exposed brick wall or support column inside the space. (Oct. 21, 2010 Tr. 34:21-35:1; 110:21-111:21.)
Despite several of the restaurant's features being dictated by the location he leased, Jivani chose some of the decorative elements, for example the wall paint and type and color of flooring tile. (Oct. 21, 2010 Tr. 30:19-31:1.) Jivani directed that the internal walls of the space be painted "burnt orange". (Jivani Decl. at ¶ 8.) In Defendant's front window one can see a white counter-top up against the front window with seating and "neon signs as well as help wanted signs and other signs." (Id. at ¶¶ 15, 16.) Defendant's main sign that identifies the restaurant "consists of a series of raised, arranged letters with the words "Kati Roll" forming an arc with the words "Platters" beneath it and an ampersand located in the middle" in white lettering on an all orange background. (Id. at ¶ 17.) The interior of Defendant company does not have any Bollywood pictures on the walls, and it does not have any tables and chairs. (Id. at ¶¶ 19, 20.)
The Court found Saha to be truthful and credible during the evidentiary hearing on October 22, 2010. Saha asserted various incidents that illustrate actual confusion. First, she stated, "[o]n December 31, 2009, I attended a New Year's Eve party in Kolkata, India. A 55-60 year-old woman pulled me aside. She complained to me about the restaurant in New Brunswick, New Jersey. She believed the restaurant was The Kati Roll Company. I had to explain to her that The Kati Roll Company does not have a store in New Brunswick." (Saha Decl. at ¶ 19.) She also stated that "[a] family member in India has had a similar experience. People have complained to her about the food in the New Brunswick restaurant, thinking it is owned by [Plaintiff]." (Id. at ¶ 20.) Moreover, "[i]n November 2009 [Plaintiff] received an e-mail from a potential franchisee who asked, 'Also, is the one in Rutgers New Brunswick your franchise or just a knock off?'" (Id., Ex. 6.) In addition, Ramkumar Ramakrishan, who has been the management analyst for Plaintiff for the past three years, asserted that he "oversee[s] fulfillment of large orders" and when "[c]ustomers and potential customers have called [him] about catering orders in New Jersey" they "ask if the store in New Brunswick is ours and whether they can place the order there." (Ramakrishan Decl. at ¶¶ 1-3; Doc. No. 39-3.) Ramakrishan identified an individual specifically, Mr. Hersh, who exhibited this exact confusion on June 12, 2010. (Id. at ¶ 4.) He also has heard customers in the 39th Street store "ask employees whether the store in New Jersey is ours." (Id. at ¶ 6.) Moreover, Ranjeet Kadam, who is an employee at the 39th Street Manhattan store and who has worked there during various periods for the past two years, stated that he has heard customers exhibit confusion about whether or not Plaintiff has a store in New Jersey, specifically in New Brunswick. (Kadam Decl. at ¶¶ 1-4.) Kadam has experienced customers' confusion with respect to items on their menu, and by way of example states that customers have ordered items that they do not sell, but rather, are offered at Defendant's restaurant. (Id. at ¶¶ 5-7.) Aprana Dut, who is Saha's mother, stated that an individual named Sumita Ghosh, approached her to ask if Plaintiff opened a restaurant in New Brunswick, New Jersey, and that she had heard complaints about the location. (Dut Decl. at ¶ 2, 3.)
Saha asserted that Plaintiff "has been planning to franchise," that they "put information about franchising on [the] website and provide[d] a link for people to e-mail . . . about franchising opportunities." (Saha Decl. at ¶ 21.) Saha maintained that Plaintiff "receive[s] 2-3 e-mails a day from people interested in obtaining The Kati Roll Company franchises. Many of those inquires have come from New Jersey. We recently moved closer to making a franchise deal," but "[t]he questions and mistakes caused by [Defendant] store in New Brunswick are problematic for our franchising efforts." (Id. at ¶¶ 22, 23.) She restated on cross-examination that she has concrete plans to franchise the store. (Oct. 22, 2010 Tr. 76:12-23.) She explained in great detail the process that she has undertaken to franchise her business, and stated that she hopes to open a location in New Jersey within the next few months. (Oct. 22, 2010 Tr. 77:4-82:1.)
Saha stated that after this litigation commenced, she learned that "Niraj Jivani posted on the Internet that he planned to open an "'original' or 'official' Kati Roll Company" in New Jersey." (Saha Decl. at ¶ 18.) While Jivani denies this accusation, the Court does not find Jivani's denial credible and finds that Jivani made these statements himself or that he gave unnamed others the power and authority to post these statements, and that ultimately Jivani had control over the content of the statements. Indeed, Jivani stated that he "did not make the posts that were attributed to [him]" but that "[i]t is likely that my friends or acquaintances made such postings to generate 'chatter' on the internet and to promote my new restaurant." (Jivani Decl. at
¶ 13.) This issue was explored on cross-examination, and the Court finds that Jivani either made the posts himself or provided the means to another by which such posts were made. These statements were made on various websites, including Platters.com, The Lounge Board, and various Facebook pages.
1. Likelihood of Success on ...