Court Sets Aside Injunction Based On Material Mistake That Caused Defendant To Settle.
There is no question that professional wrestling has become part of American mainstream entertainment, especially when entities in this arena start filing lawsuits for protection of their intellectual property. Plaintiff, Patterson, filed an action in the Eastern District of Wisconsin for unfair competition and trademark infringement against defendant, TNA Entertainment, LLC. Plaintiff alleged that he had adopted various marks for use in connection with professional wrestling, including World Wrestling Association, W.W.A. Superstars, Superstars of Wrestling, and other variations of these marks. He further alleged that defendant had infringed on his right to use those marks.
The parties participated in a mediation which resulted in a settlement of the case. Defendant, after much hesitation, agreed that the injunction would include use of the term "Superstars" due to plaintiff's representation that he had already successfully prevented another competitor from using this term. Approximately one month later, the defendant filed a "Motion for Relief from Judgment, to Rescind Settlement Agreement, Vacate Injunction, Reinstate Action and for Sanctions." Defendant claimed that the settlement had been procured by fraud and, as such, the judgment should be vacated pursuant to Fed.R.Civ.P. 60(b).
During settlement discussions, plaintiff represented that he had successfully petitioned to cancel a federal trademark registration owned by another competitor, Titan Sports, Inc. d/b/a The World Wrestling Federation, for the mark "WWF Superstars." Although defendant was originally unwilling to agree to the inclusion of "Superstars" in the injunction, it changed its mind based on plaintiff's representations of prior success in preventing another competitor from using this term. When defendant obtained a copy of the relevant documents from the U.S. Patent and Trademark Office ("USPTO"), it became apparent that this trademark registration was not canceled due to plaintiff's petition, but rather upon the petition of Titan Sports, Inc. In other words, the trademark owner canceled its own mark. The USPTO records do show that the cancellation proceeding by plaintiff was dismissed and, subsequently, the "WWF Superstars" mark was surrendered under Section 7 of the Trademark Act. Paragraph (e) of that section says, "Upon application of the registrant the Director may permit any registration to be surrendered for cancellation, and upon cancellation appropriate entry shall be made in the records of the Patent and Trademark Office." Thus, plaintiff's representations to defendant in the instant litigation were false.
Although the Court found such representations to be false, it did not go as far as to say that they were fraudulent for purposes of setting aside the judgment under Fed.R.Civ.P. 60(b)(3). Nonetheless, since Rule 60(b)(1) states that a judgment may be set aside based on "mistake, inadvertence, surprise, or excusable neglect," the Court granted defendant's motion to set aside the injunction. The Court found that the mistake in this case was material to defendant's decision to enter into the settlement agreement. However, since this mistake did not rise to the level of fraudulent misrepresentation, the Court denied defendant's motion for attorney's fees and costs.
Patterson v. TNA Entertainment, LLC, (Slip Op.) 2006 WL 587696 (E.D. Wis., March 10, 2006).
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