Free Motion for Summary Judgment - District Court of California - California

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1 JAMES P. COLLINS, JR. (SBN 47608) COTKIN & COLLINS 2 A PROFESSIONAL CORPORATION 200 West Santa Ana Blvd., Suite 800 3 P.O. Box 22005 Santa Ana, CA 92702-2005 4 Telephone: (714) 835-2330 Facsimile: (714) 835-2209 5 Email: [email protected]
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7 8 9 10 11 12

DAVID T. SCHULTZ (MN NO. 169730) JOLYNN M. MARKISON (MN NO. 0386876) JOHN K. DARDA (MN NO. 0388298) MASLON EDELMAN BORMAN & BRAND LLP 3300 Wells Fargo Center 90 South 7th Street Minneapolis, MN 55402-4140 Telephone: (612)672-8200 Facsimile: (612) 672-8397 Email: [email protected] [email protected] [email protected]

13 Attorneys for Plaintiffs STEVEN SCHUSSLER and SCHUSSLER CREATIVE, INC. 14 UNITED STATES DISTRICT COURT 15 SOUTHERN DISTRICT OF CALIFORNIA 16 Case No. 07CV2016IEG (AJB) 17 STEVEN SCHUSSLER and INC., SCHUSSLER CREATIVE, 18 Plaintiffs, 19 20 21 22 23 24 25 26 27 28 /// /// /// /// vs. J. FRANK WEBSTER, aka "MR. HOT DOG," aka "UNCLE FRANK," Defendants.
PLAINTIFFS' MEMORANDUM POINTS AND AUTHORITIES SUPPORT OF MOTION FOR SUMMARY JUDGMENT OF IN

DATE: August 18, 2008 TIME: 10:30 a.m. COURTROOM: 1

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INTRODUCTION Defendant J. Frank Webster, aka "Mr. Hot Dog, aka "Uncle Frank" ("Mr. Webster" ) is an avid hot dog enthusiast and

collector of hot dog memorabilia,

who has declared himself to He believes he owns

be the "official" "Hot Dog Hall of Fame."

the exclusive right to use the phrase, "Hot Dog Hall of Fame," even though he has made no identifiable commercial use of that name and has not attempted federal agency. through his to register it with any state or ("Mr. Schussler"), Creative, Inc.

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8
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Plaintiff Steven Schussler Plaintiff Schussler

10 11 12 13 14 15 16 17 18 19 20 21 22 23
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company

("Schussler Creative"),

is a highly successful

restauranteur

who specializes in the development of theme-based restaurants. His successes Mr. Schussler themed include began the now famous Rainforest to develop Cafe. When

his idea to open a hot dog

restaurant

called

Hot Dog Hall of Fame, Mr. Webster

took umbrage. Webster campaign made

Rather than seeking legal redress, however, Mr. a conscious decision to embark business on a personal and reputation,

to damage Mr. Schussler's plan.

and to derail his business right to prohibit Mr.

Because Mr. Webster has no legitimate business

Schussler's

activities, Mr. Schussler and Schussler Creative are entitled to summary judgment defamation, on their claims for declaratory interference. ARGUMENT relief,

and tortious

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I. Schussler Creative Is Entitled to a Declaratory Judgment That Its Use of "Hot Dog Hall of Fame" Does Not Infringe Any Protectible Right Held By Mr. Webster A. This Court Has Jurisdiction Declaratory Relief to Grant This

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Under the Declaratory

Judgment Act

(UDJA"), a federal

court may udeclare the rights and other legal relations" of parties in Ua case of actual controversy." v. Asarco, 28 U.S.C.
§

2201; see Wickland Oil Terminals 887, 893 (9th Cir. 1986). disputes

Inc., 792 F.2d trademark

In the Ninth Circuit,

constitute an actual controversy has a real and reasonable

under the DJA when apprehension that Inc.

Uthe plaintiff

he will be subject to liability." v. Faberge,

Chesebrough-Pond's,

Inc., 666 F.2d 393, 396 (9th Cir. 1982) omitted). In determining whether the the

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

(internal quotation plaintiff's

perceived

threat is real and reasonable, position

court focuses on the plaintiff's and examines the defendant's probable

and perceptions,

actions in light of their and the risk imposed on the is engaged in

impact on competition (Id.) Further,

plaintiff.

if the plaintiff

the ongoing use of the allegedly showing of apprehension

infringing mark, the See

Uneed not be substantial."

Societe de Condi tionnement en Aluminium 655 F.2d 938, 944 (9th Cir. 1981) case). Here, Schussler Creative the legal rights between accordance with the DJA. that

v. Hunter Eng'g Co.,

(patent infringement

asks this Court to determine in Creative

itself and Mr. Webster Specifically,

Schussler

seeks a declaration trademark

(1) Mr. Webster has no protectable

right in his use of uThe Hot Dog Hall of Fame;" Creative is not infringing any trademark use of

(2) Schussler

rights owned by Mr. Webster;

and (3) Mr. Webster's

the name uThe Hot Dog Hall of Fame" cannot prevent Schussler

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Creative's

use of the name Hot Dog Hall of Fame for its Under the DJA, Schussler Creative has standing Mr. Webster's threats

restaurants.

to seek declaratory

relief from this Court.

cease and desist letters, as well as his continuing of a trademark infringement

lawsuit, have caused Schussler apprehension that

Creative to develop a real and reasonable it will be subject to liability of Fame. Schussler Creative's

for its use of Hot Dog Hall fears have been bolstered by Schussler Creative's

Mr. Webster's

persistence

in contacting

business partners, Schussler

thereby overtly interfering business

with

Creative's

and damaging its reputation. of to be

Mr. Webster's Schussler

actions have caused future development Hot Dog Hall of Fame restaurants

Creative's

placed at risk, as Schussler strong business reputation

Creative relies heavily on its

to obtain tenant allowances. is engaged in ongoing use of to open the

Because Schussler

Creative

the trademark Hot Dog Hall of Fame-by preparing first unit of the restaurant with chain restaurant Red Development,

this summer and by contracting such as

and shopping mall developers

Levy, and Landry's

to secure additional Creative's

sites for future restaurants-Schussler apprehension

of liability does not need to be substantial. Mr. Webster's threats of of

See Societe, 655 F.2d at 944. litigation, Plaintiffs'

as well as his threats toward and harassment business associates, of Schussler demonstrate the of

reasonableness liability.

Creative's

apprehension

See Chesebrough-Pond's,

666 F.2d at 396.

Accordingly,

this trademark dispute has ripened into an

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actual controversy, Schussler B. Creative's

giving this Court jurisdiction request for declaratory

to grant

judgment.

Mr. Webster Has No Trademark Hall of Fame" Creative has received

Rights to "Hot Dog

5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

Schussler

notice

of allowance

of The

its registration registration of Schussler Schussler Brookfield 1036, 1047

of the word mark Hot Dog Hall of Fame.

constitutes prima facie evidence of the validity Creative's Hot Dog Hall of Fame mark, and of See

Creative's

exclusive

right to use that mark.

Corom., Inc. v. West Coast Entm't (9th Cir. 946, 957 1999); Garden of Life

Corp., 174 F.3d v. Letzer, 318

F.Supp.2d

(C.D. Cal. 2004). the was has presumption the first

Mr. Webster-as of to validity use mark the
in

a nononly mark by
in

registrant-may demonstrating commerce and

rebut that that he

he

used

the

commerce

continuously

since the date of his first use.

Brookfield, 174

F.3d at 1047; Garden of Life, 318 F.Supp.2d at 957. For purposes of this motion, Schussler Creative does not dispute that Mr. Webster used the phrase "The Hot Dog Hall of

Fame" to describe his activities prior to Schussler Creative's adoption of that name. Even so - as a matter of law - Mr.

Webster's use of that phrase in connection with his hobby has not created trademark rights and cannot defeat Schussler Creative's right to use Hot Dog Hall of Fame for

25 its restaurants.1

27 28

1 Because Mr. Webster has never registered the name "Hot Dog Hall of Fame" under any federal or state registration scheme, his trademark rights, if any, exist as a creation of common law. In determining the existence of

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Under both the Lanham Act and common law, the touchstone of trademark rights is actual use of the alleged commercial 174 F.3d at

mark in commerce,

and the test for establishing Brookfield,

use under either law is the same. 1051.

Under the Lanham Act, "use in commerce" the mark be:

requires that

9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

used or displayed in the sale or advertising of services and the services are rendered in commerce, or the services are rendered in more than one State or in the United States and a foreign country and the person rendering the services is engaged in commerce in connection with the services. 15 U.S.C.
§

1127.

In fact, Congress amended the Lanham Act in strengthen the use in commerce trademark rights can be

1988, in order to specifically requirement, conveyed only making through clear

that

"the bona

fide use of a mark

in the

ordinary course of trade, and not [use] made merely to reserve a mark." 1127). Because Mr. Webster has never used the phrase "Hot Dog Brookfield, 174 F.3d at 1051 (citing 15 U.S.C.
§

Hall of Fame" in commerce, Mr. Webster has no trademark rights in that name and thus cannot prevent Schussler Creative from naming its restaurant
1.

Hot Dog Hall of Fame.

Mr. Webster's Lack of Sales Activity to His Claim that He Owns The Name Hall of Fame" does not "own" the name

is Fatal "Hot Dog
of

Mr. Webster

"Hot Dog Hall

common law trademark rights, courts frequently rely on decisions arising under the Lanham Act. See Allard Entm't, Inc. v. Advanced Programming Res., 146 F.3d 350, 357 (6th Cir. 1998).

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Fame," because he never used that name in commerce.

According

to the Ninth Circuit, ownership may be shown through evidence of actual sales of goods or services that use or display the mark. Chance v. Pac-Tel 2001). Teletrac Inc., 242 F.3d 1151, 1159 a lack of bona fide sales

(9th Cir.

Conversely,

activity-including

mere token sales or sham sales designed to often fatal to

circumvent the Uuse in commerce" requirement-is a party's claim to trademark rights.

(Id. at 1157, 1159.) under the name (Webster

In this case, Mr. Webster's

activities

uThe Hot Dog Hall of Fame" have produced zero sales. Dep. 63:14.) audience Chronicles of The Frankie Awards are given away hot dog enthusiasts), and the

(to a select Frankfurter

and WeenieGrams

are distributed

for free via the

internet and generate no revenues. sell his uconsulting"

(Id.) Nor does Mr. Webster

services or the services he provides at (Id.) first Finally, Mr. Webster's glance may appear to

hot dog stand grand openings. online Ustore," which at

demonstrate mark.

sales activity, in reality falls far short of the

The full inventory of Mr. Webster's online store consists of sixteen t-shirts and twelve ball caps - none of which he has actually Instead, sold.2 (Id. at 110:10-113:21.) away six t-shirts and

Mr. Webster

has gifted

three ball caps, to friends and family. (Id. at 123:4-125:11.)

2 The other Uitems" listed on Mr. Webster's website-a movie entitled The Weenie Roast Massacre and a book called 50 Ways to Top a Hot Dog-are actually links to other websites operated by the creators of those works. Mr. Webster does not himself own any inventory in those items and does not offer them for sale.

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Even if an actual customer wished to purchase a ball cap or tshirt, however, Mr. Webster's orders online. Potential website is not equipped to take interested in making a

customers

purchase

are asked to e-mail Mr. Webster (Id.) only

and he will Ureply Mr. Webster has for sale in

with particulars." admitted that he

More importantly, began to offer

items

response to this lawsuit, when he heard counsel for Schussler Creative argue that Mr. Webster had not made commercial use of the name UHot Dog Hall of Fame." (Id. at 125:6-15.)
3

In short, because Mr. Webster can present no evidence of bona fide sales activity associated with the name uThe Hot Dog Hall of Fame," he does not own trademark rights to that name

and cannot prevent Schussler Creative from using that name for its restaurant.
2.

Mr. Webster's Claim of Ownership Also Fails Under the Totality of the Circumstances Test the lack of any evidence of actual sales is

Although frequently

dispositive, be

the question on the

of use in commerce may of each case, as

alternatively trademark goods or

decided

facts

rights may occasionally services taken if the

vest prior to the sale of of a the alleged to owner's use the

totality establish

actions,

together,

right

3 Even if Mr. Webster had made a few token sales from his online Ustore," those sales would not constitute a bona fide use of the mark in commerce since, by his own admission, Mr. Webster's sole purpose in offering t-shirt and ball cap sales was to dodge the Uuse in commerce" requirement. See Chance v. Pac-Tel Teletrac Inc., 242 F.3d 1151, 1157 (9th eire 2001) (stating that sham attempts to conform with statutory requirements do not constitute bona fide use of a mark in commerce) .

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trademark. F. 3d at

Chance,

242 F.3d at 1158-1159; the totality of

Brookfield,

174

2
3

1052. are

Under by

circumstances including and

test, the

courts

guided factors:

non-sales
(1)

activities,

4
5 6

following character

the

genuineness

commercial of whether

of the activity;

(2) the determination public to identify segment
(3)

the mark was sufficiently the marked service

or distinguish of the public

7
8 9

in an appropriate

mind as those of the holder of the mark; non-sales reasonable ongoing activity relative

the scope of the

to what would be a commercially (4) the degree the business
(Id. )

10

attempt to market the service; and activity of the holder to conduct

11 of

12 13 14 15 16

using the mark and the amount of business

transacted.

Applying this test, no reasonable trier of fact could conclude that Mr. Webster has used the mark, "The Hot Dog Hall of

Fame," in commerce. a. Mr. Webster's activities commercial in character first test, prong Mr. of the totality are of are not the not

17 18 19 20 21 22 23 24 25 26 27 28 Under the

circumstances sufficiently use of

Webster's

activities

"commercial" to vest any trademark rights in his of Fame." Mr. Webster's various

"The Hot Dog Hall include: name (4)

activities (2) his

(1) his hot dog memorabilia and his website; (3) his and are

collection; and

domain

newsletter Frankie

WeenieGrams; ceremonies. nature.

and None

barbeques activi ties

Awards in

of these

"commercial"

First, Mr. Webster's does not constitute

collection

of hot dog memorabilia The memorabilia is

commercial

activity.

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not part of any regular trade or business,

does not generate

any revenue, and is not on regular public display, either free or for a charge. The two times that portions of the

collection were on public display-in

the uHal1 of Fame Hall of

Fame" and at the UHot Diggity Dogs" stand-were isolated, longago instances that were not of a commercial collection years, character. has been and

Finally, stored

the fact that the memorabilia for the past

in boxes

twenty-five

unseen

unused by Mr. Webster or anyone else, is further evidence that the memorabilia Second, collection is not of a commercial domain character.

neither

Mr. Webster's

name registration

nor his corresponding purposes of acquiring

website constitute trademark

ucommercial use" for Registration of a

priority.

domain name is insufficient priority Acad. Inc., purposes.

to establish

Uuse" for trademark

Brookfield,
&

174 F.3d at 1051; see also Scis. v. Network Cal. Solutions, (mere

of Motion

Picture Arts 1276,

989

F.Supp.

1281

(C.D.

1997)

registration of a domain name does not constitute a commercial use); Lockheed Martin Corp. v. Network Solutions, Inc., 985

F.Supp. 949, 957 (C.D. Cal. 1997) (acceptance of a domain name for registration is not a commercial use). Accordingly, the

registration of Mr. Webster's domain name, by itself, does not constitute commercial use.

In addition, even a cursory reading of the content of Mr. Webster's website and his electronic publications demonstrates the noncommercial content-movie family's nature of his web activities. recipes, during commentary national The website's

reviews,

of Mr. Webster's hot dog month,

eating

habits

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etc .-demonstrates commercial,

that

these

activities

are

personal,

not

and are simply born of Mr. Webster's hot dog. Further, as discussed

fascination above, Mr.

with all things

Webster's online "store" also fails to qualify as a commercial use of the phrase as a "Hot Dog attempt Hall to of Fame," conform because with it was

created

sham

statutory

requirements inception.

and because it has produced zero sales since its

Finally, neither of Mr. Webster's last two activities can be considered "commercial" in character. Because Mr.

Webster's newsletters any advertising,

and WeenieGrams are free, do not contain

and are sent via e-mail, these pUblications in any sense of the term. that e-mail See Chance, 242 does not

are not commercial F.3d at 1158

(stating

correspondence priority

constitute Brookfield, Webster's past)

commercial

use for trademark

purposes);

174 F.3d at 1052

(stating same). parties

Similarly, Mr. (in the not

sporadic barbecue out the

at which he has were free,

given

Frankie

Awards

were

sponsored, and were only attended by Mr. Webster's family and personal friends. As such, those barbeques and the

corresponding

Frankie Awards ceremonies

are not "commercial"

in nature because

they have nothing to do with any "service" Rather, these activities-like engaged in by Mr. Webster-are

that is offered "in commerce." each of the prior activities

simply a part of his personal hobby. As further evidence of the noncommercial character of Mr.

Webster's hobby, none of his "Hot Dog Hall of Fame" activities has the normal indicia of commercial activity. Not only does

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2

Mr. Webster's revenues, state or

"Hot Dog Hall

of Fame"

generate

no sales

or

it has no paid employees, federal income taxes,

has never has never

filed either possessed a

3 4
5 6

California

sales tax registration status.

certificate,

and does not

enjoy non-profit

In short, Mr. Webster can produce no character. His

evidence of any activity of a true commercial "Hot Dog Hall of Fame" is just a personal which Mr. Webster dog enthusiasts.
b.

7 8 9
10

hobby,

the joy of

shares with a small band of like-minded hot

11
12 13 14 15

Mr. Webster's use sufficiently public in the public mind

of the mark is not to create association

Applying the second factor, Mr. Webster's use of "The Hot Dog Hall of Fame" also fails to establish priority commerce. consumers Brookfield, A primary the purpose source of of a trademark product
1S

of use in to help

identify

the

or

service.

16
17 18 19 20 21 22 23 24 25

174 F.3d at 1051.

A trademark

cannot serve its

source-identifying mark. (Id.)

function if the public has never seen the a mark does not acquire trademark

Thus,

protection until it is used in a public manner that creates an association among consumers between the mark as used on goods (Id.) Here, Mr. Webster's public

or services and the mark's owner.

use of "The Hot Dog Hall of Fame" is not sufficiently to create that association.

Mr. Webster's various displays of the phrase "The Hot Dog Hall of Fame" are insufficient to establish a

26 27 28

source-identifying

function.

The words "The Hot Dog Hall of in the Frankfurter Chronicles

Fame" appear only sporadically

and on Mr. Webster's website, they have rarely appeared on the

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WeenieGrams, Mr.

and they have never appeared in association with awards cookouts or on the Frankie Award.

Webster's

(Webster Dep. at 113:21-114:3, In fact, as Mr. Webster

93:18-22, 117:10-14, 96:10-25.) himself has admitted, he has

deliberately

tried to keep the public and his website.

from gaining access to The

his newsletter

(Id. at 110:10-113:21.)

Frankfurter Chronicles are distributed by invitation only, and Mr. Webster has deliberately with internet search engines. Hall of Fame" activities-even far short of evidencing avoided registering (Id.) his website "Hot Dog

Mr. Webster's

when viewed

in his favor-fall between that

a public

association

phrase and his activities. c. Mr. Webster's has failed to make a commercially reasonable attempt to market his "Hot Dog Hall of Fame" the scope of non-sales advertising

14 15 16 17 18 19 20
21

In

some

cases,

activity can demonstrate market one's services

a commercially that is, in

reasonable attempt to turn, sufficient to The

establish trademark

rights.4

Chance,

242 F.3d at 1160.

analysis is, of course, fact specific.
of Life,

For example, in Garden that plaintiff its product had to a

the court

found

that

evidence

22 23 24 25 26 27 28

spent approximately

$6 million

advertising

target market demonstrated 959-60.

use in commerce.

318 F.Supp.2d at
Inc.,

In New West Corp. v. NYMCompany of California,

4 While advertising alone cannot establish priority of use, in some circumstances advertising in combination with other non-sales activity may be sufficient to establish use in commerce. New West Corp. v. NYM Co. of Calif., Inc, 595 F.2d 1194, 1200 (9th Cir. 1979).

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the

court

determined consisting magazine

that of

a

publisher's

direct of

mail its and

solicitations forthcoming

430,000 to

"mock-ups"

cover

potential

customers

advertisers was sufficient to establish use in commerce where the publisher spent $1.3 million in developing and advertising the magazine. 595 F.2d 1194, 1199 (9th Cir. 1979). "The Hot Dog unlike in

Mr. Webster claims to have been cultivating Hall of Fame" for the last 30 years.

However,

Garden of Life and New West, no reasonable conclude, based on the undisputed Webster's attempts activities to market a constitute commercial and

fact-finder

could

facts in this case, that Mr. "commercially venture. reasonable" Webster's

Mr. are

Frankfurter electronically acquaintances. distributed Webster sales. ceremony does

Chronicles

WeenieGrams

distributed and are

to approximately (Webster Dep.

200 friends, 108:23-110:8.)

relatives, They

free of charge not use them

at irregular

intervals, or

and Mr.

for advertising

to generate

Similarly, and/or

invitation to Mr. Webster's Frankie Awards Hot Dog Month barbecue (which

his National

have not been held in any event for several years) were not advertised and attendance was mostly limited to Mr. Webster's friends, relatives, and acquaintances. Mr. Webster's fame, museum, (Id. at 96:1-99:7.) If

ultimate goal is to open a combination restaurant, gallery, and gift shop

hall of

(which he

indicated during his deposition), activities

then as a matter of law his reasonable attempt

to-date are not a commercially

to market toward that goal. ///

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d.

2

Mr. Webster is not engaged in ongoing activity using the alleged mark to conduct business

3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

Mr. Webster does not currently, nor has he ever, operated a business under the trade name "The Hot Dog Hall of Fame."

His three hot dog stands were called "Frank's Quality Franks," "The Great American Hot Dog Machine," (Id. at 29:2, 29:7, 33:10.) and "Hot Diggity Dogs."

Despite the fact that during the

six months Mr. Webster operated Hot Diggity Dogs, he displayed a few items of memorabilia under a hand-painted sign reading,

"The Hot Dog Hall of Fame," this one-time use, now ancient, is clearly insufficient to establish trademark rights. (Id. at

36:20-23.) a business

At best, this use is akin to putting one's mark on office door sign or letterhead, rights. which is

insufficient

to establish

trademark

See Brookfield,

174 F.3d at 1052; Steer Inn Sys., Inc. v. Laughner's Drive-In, Inc., 405 F.2d 1401, 1402 (C.C.P.A. 1969). Further, Mr .

Webster's Hot Diggity Dogs business failed in 1983, after only six months of operation. (Id. at 35: 9 .) Even if the hand

painted sign and display of memorabilia had been sufficient to create trademark rights in 1983, Hot Diggity Dogs went out of business business that 25 years using ago and Mr. Webster has not operated a

the phrase Therefore,

"The Hot Dog Hall of Fame" since by any reasonable standard, Mr.

time.

Webster's lacks rights. the

use of

"The Hot Dog Hall of Fame" over the years nature required to create trademark

continuous

Moreover, restaurant,

Mr.

Webster's hall of

dream fame,

of

one

day and

opening gift

a

museum,

gallery,

shop

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cannot establish Mr. Webster's phrase goals "Hot Dog Hall and dreams rights.

right to exclusive use of the It is axiomatic in commerce that mere create

of Fame." a mark

to use

do not

trademark

Guichard

v. Universal City Studios, LLLP,

No. 06-6392, 2007 WL 1750216, at *3 (N.D. Cal. June 15, 2007); Matrix Motor Co., Inc v. Toyota Jidosha Kabushiki Kaisha, 290 F.Supp.2d 174 F.3d 1083, 1089 at 1052 (C.D. Cal. 2003); see also Brookfield, that trademark a mark rights are not

(stating mere intent what

acquired Here,

through

to use

commercially).

that

is exactly

Mr. Webster's

"Hot Dog Hall of

Fame" is-a future dream or ambition Webster's mind. Accordingly,

that exists only in Mr. also fails on the analysis.

Mr. Webster

final factor ln the totality of circumstances Because, based on the undisputed

facts and circumstances trademark

of this case, Mr. Webster has no valid, protectible interest in the phrase Schussler Creative

"Hot Dog Hall of Fame," he cannot bar

from using that name for its restaurant. Creative is entitled to the requested

Accordingly, declaratory

Schussler judgment.

III. Steven Schussler Defamation Claim As a matter of

is Entitled

to Summary Judgment On His

law,

the

e-mails

Mr.

Webster

sent

to

Plaintiffs'

business

partners,

the industry press,

and city

officials in Sparks, Nevada, as well as the messages he posted on his website, constitute libel. Between May and October

2007, Mr. Webster published the following libelous statements: (1) Mr. Webster told media organizations and hospitality companies, including Host Marriott, Levy Restaurants, Success Magazine, The Harford Courant,

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4

The Rocky Mountain News, The Chicago Sun Times, The San Diego Union Tribune, and Chain Magazine that the concept, name, and related intellectual property of Hot Dog Hall of Fame belonged exclusively to him, not to Mr. Schussler. (Pl.'s Ex. 7; Webster Dep. at 171:18-172:8.) (2) In an edition of his Frankfurter Chronicles dated June 17, 2007, Mr. Webster again stated that Mr. Schussler had stolen his intellectual property. (PI.'s Ex. 10.) He also posted a copy of a letter he had previously sent to one of Schussler Creative's business partners, in which Mr. Webster had threatened his plan to "first blacken both of your eyes (yours and Mr. Schussler's) professionally, first in the papers and on TV, then we will see you in court." (Id.) (3) In September, 2007, Mr. Webster began contacting Schussler Creative's business partners in an effort to disrupt Schussler Creative's business. In an email dated September 17, 2007, Mr. Webster told Red Development that Mr. Schussler was a "liar," a "thief," and a "con man," because Mr. Schussler was attempting to steal the concept and name of Hot Dog Hall of Fame from him. (PI.'s Ex. 11.) (4)In an e-mail dated September 18, 2007, sent to Red Development, Mr. Webster wrote, "[Mr. Schussler] may not own another one of the concepts he's currently touting." (Pl.'sEx. 10.) Mr. Webster claimed he received this information from an anonymous source, but did nothing to verify the truth of this statement before publishing it. (Webster Dep. at 187:18-188:14, 192:7-13.) (5)On September 18, 2007, Mr. Webster sent an e-mail to the Mayor and City Council for the City of Sparks, Nevada, in which he again called Mr. Schussler a "liar," a "thief," and a "con man," because Mr. Schussler had stolen the concept and name of Hot Dog Hall of Fame from Mr. Webster. (PI.'s Ex. 11.) The e-mail also contained links to Mr. Webster's website where he published similar defamatory allegations.
(Id. )

5 6 7 8
9

10
11

12 13 14 15 16 17 18 19 20 21
22

23 24 25 26 27 28

(6)On October 10, 2007, Mr. Webster posted an edition of the Frankfurter Chronicles on his website in which he wrote that Schussler Creative had stolen his intellectual property. (PI.'s Ex. 10.) California Civil Code Section publication 45 provides: by writing "Libel is a . which

false and unprivileged

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4

exposes any person to hatred, contempt, which causes him to be shunned

[or] ridicule

...

or

or avoided,

or which

has a

tendency to injure him in his occupation." A. Mr. Webster's Written Schussler Are False has admitted Creative's

{emphasis added} .

Statements About Mr. that he authored business partners and sent eand to city

5

6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

Mr. Webster

mails to Schussler

officials, calling Mr. Schussler a "liar, thief and con man," and alleging that Mr. Schussler stole the concept and name Hot Dog Hall of Fame from him. Webster posted Frankfurter Schussler similar {Webster Dep. 183:-186:11.} on his website Red Development Mr.

statements and told

and in the that Mr. he was

Chronicles,

might

not own another

one of the concepts 192:7-13.}

claiming to own.

{Id. at 187:18-188:14,

Because,

based on the undisputed

facts of this case, Schussler Creative

does in fact have the right to use Hot Dog Hall of Fame name on its restaurants, has not infringed on any trademark rights

owned by Mr. Webster, and is not "touting other concepts that it might not actually own,5 Mr. Webster's statements are false as a matter of law. B. Mr. Schussler's Damages Are Presumed Because Mr. Webster's Statements Are Libelous Per Se per se is "libel which is defamatory of the

Libel

plaintiff without the necessity of explanatory matter, such as an inducement, innuendo or other extrinsic fact." Cal. Civ.

5 In his deposition, Mr. Webster admitted that he now believes that his representation was untrue. {Webster Dep. At 192:8-23.}

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Code [] a

§

45a. reader

As stated by the California Court of Appeals, would perceive a defamatory meaning

"If

without

extrinsic

aid beyond

his or her own intelligence

and common Inc. v.

sense, then there is a libel per se." Allergan Pharmaceuticals, Ct. App. 1986). In Inc.,

Barnes-Hind,

226 Cal.Rptr. 354, 356 (Cal. publications that are

other

words,

libelous per se have a natural tendency to injure. Code,
§§

Cal. Civ. Inc., 15

45, 46; Mann v. Quality Old Time Service, 215, 224 (Cal. Ct. App. 2004).

Cal.Rptr.3d calling

For instance, to injure

someone

a "thief" has a natural

tendency

that person's reputation. C-95-1299 1996).

Smith v. Airborne Freight, Co., No. (N.D. Cal. Apr. 19, "liar," where that

SI, 1996 WL 207760, at *2 n.2 Likewise, calling someone a

accusation is based on conduct capable of being proved false, also injures a person's Cal. Rptr. 3d 480, reputation. (Cal. Ct. See Carver v. Bonds, 37 App. 2005). Where a

494-95

statement is defamatory per se, actual damages are presumed so that a cause of action is conclusively false statement itself. Burdette established from the

v. Carrier Corp., 71 Cal.

Rptr.3d 185, 205 (Cal. Ct. App. 2008); Contento v. Mitchell, 104 Cal.Rptr.591, 592 (Cal. Ct. App. 1972). statements are defamatory per se and of damages. The defamatory

Here, Mr. Webster's he is entitled meaning

to a presumption words

of Mr. Webster's

is clear on their face: Mr. a "liar," "thief," and

Schussler "con man." meaning very

is dishonest-specifically,

Anyone reading these words would understand their

and would be able to see that such words, by their would injure a person's reputation. Mr.

nature,

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Webster's threshold,

defamatory alleging

statements

go

even

further

than

this

that Mr. Schussler

is a "liar," "thief,"

and "con man" because he stole the concept and name, Hot Dog Hall of Fame, and because he may not actually own another of the concepts he is touting. are defamatory Because Mr. Webster's allegations

on their face and are based on facts that can and bad-mouthing Schussler need constitute present 71 Cal.

be proven false, his name-calling libel per se. Consequently,

not

evidence of actual injury or damages. Rptr.3d at 205.
IV.

See Burdette,

Schussler Creative Is Entitled to SummaryJudgment On Its Claim for Tortious Interference With Contract

The elements contract are:

of a claim for tortious contract between

interference plaintiff

with and a (c)

(a) a valid

third party;

(b) defendant's

knowledge

of that contract;

defendant's intentional act designed to induce a disruption of the contractual relationship; and (d) resulting damages.

Pacific Gas and Electric 587, 589

Co. v. Bear Stearns & Co., 791 P.2d v. Hamilton, 95 P.3d 513, 517

(Cal. 1990); Reeves

(Cal. 2004). Schussler Creative's claim against Mr. Webster meets each of these elements. It is undisputed that Schussler Creative and that Mr. Webster

has valid contracts with Red Development had knowledge

of those contracts when he sent his e-mails to (Schussler Decl. ~ 10;

Schussler Creative's business partners. Webster Dep. 184:1-5.) he sent the defamatory

In fact, Mr. Webster has admitted that e-mails in order to prevent Mr.

Schussler

from opening Hot Dog Hall of Fame and to convince

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Red Development not to work with Schussler Creative. Dep. at 184:22-185:14, Schussler 192:14-17.) Creative's trying In other

(Webster words, by Mr.

contacting Webster was

business to

associates, and

intentionally

frustrate

disrupt

Schussler Creative's As a result of

contractual Mr.

relationships. interference, Schussler

Webster's

Creative has sustained Mr. Schussler of

damages. his

By sending e-mails accusing intellectual property, that Mr.

stealing a key

Webster

implicated

representation

Schussler

Creative made in its contracts-that

Schussler Creative has the (Schussler Decl. implied that was of

right to use the name Hot Dog Hall of Fame. ~ 28.) Because Mr. Webster's Creative's e-mails

directly

Schussler false, Sparks Red

representation became license

to Red

Development the City

Development refuse to

concerned its

that

would

planned

shopping

mall

developments arise

due to the potential of Fame. to proceed City
(Id.)

for litigation
(Id. )

that could Red

over Hot Dog Hall had refused with Kansas

Consequently, proposed Nevada

Development agreements matter was

with

licensing until this

and

Sparks, Mr.

resolved.

Thus,

Webster's

conduct

effectively

forced Schussler

Creative to initiate this legal

action, as its only other option was to face potential loss of business and potential default
(Id.)

on its

$20 million

line of

credit with Red Development.

Indeed, this was the precise damage Mr. Webster intended to inflict. Mr. Webster's plan was to provoke Mr. Schussler
(See

into filing this lawsuit. Cause Hearing at 20:2-3

Transcript

of Order to Show [in sending the e-

("My entire purpose

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mails] was to get Mr. Schussler Mr. Webster's in conduct, fees and

to sue me."» Creative

As a result of has spent over

Schussler to secure

$50,000 against issue. and

legal

a preliminary and finally

injunction this

Mr. Webster

to fully

resolve

In addition, Schussler Creative has spent time, money, responding to inquiries and assuring its

resources

business

associates

of its right to the concept and name Hot in its contracts.
1S

Dog Hall of Fame as provided Accordingly, Schussler

(Id.

at ~ 32.) summary

Creative

entitled

to

judgment on is claim for tortious interference
V. Mr. Webster Is Liable For Tortious Prospective Business Relations

with contract.
With

Interference

The elements prospective with

of a claim

for tortious mirror

interference

with

economic with

relations one injury

those of interference Because prospective the latter

contract,

exception. to
a

protects

against

economic that

relationship, the defendant legal measure

it requires engaged other

the plaintiff

to demonstrate

in conduct than the

that was wrongful of interference
Inc.,

by some itself.

fact

20 Della

Penna v. Toyota Motor Sales,

U.S.A.,

902 P.2d 740, wrongful if it is

21 22 23 24 25 26
27

751 (Cal. 1995).

"[A]n act is independently

unlawful, that is, if it is proscribed by some constitutional, statutory, regulatory, common law, or other determinable legal standard."
Korea Supply Co. v. Lockheed Martin Corp.,

63 P.3d

937, 954 (Cal. 2003). constitutes
Sproqit

It is well established wrongful conduct.

that defamation
Visto Corp. v.

independently

Tech. Inc.,

360 F.Supp.2d 1064,1067 Creative has

(N.D. Cal. 2005). business

28

Here,

Schussler

prospective

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relationships Sparks, Nevada. Creati ve

with

both

Red

Development

and

the

City

of

These entities have contracted wi th Schussler and operate Hot Dog Hall of Fame at Red

to open

Development's Decl. ~ 11.)

Legends As

at Sparks Marina stated above,

in 2009.

(Schussler facts

the

undisputed

demonstrate

that Mr. Webster

had knowledge

of this contract and the City of their causing

and sent defamatory e-mails to Red Development Sparks expressly with for the purpose of

disrupting thereby

relationship

Schussler

Creative,

Schussler Creative to file the present lawsuit and incur both monetary damages and damages to its reputation. Because the

undisputed

facts also establish that Mr. Webster's conduct was wrongful (i.e. his conduct constituted to summary judgment libel), on its business

independently Schussler

Creative

is entitled

claim for intentional relations. VI. Schussler Relief Permanent

interference

with prospective

Creative

Is Entitled relief

to Per.manent Injunctive to deter Mr.

injunctive

is necessary

Webster from continuing his tortious and defamatory behavior. Once a statement permanent defendant is judicially relief determined is to be defamatory, to prevent a

injunctive

appropriate

from repeating

that statement.

See Balboa

Island

Village Inn, Inc. v. Lemen, 156 P.3d 339, 350-51

(Cal. 2007)

(recognizing that once the court finds published statements to be false, the plaintiff may seek a permanent injunction

restraining any further pub Ld ca t i on of the defamatory matter) ; see also MAI Sys., Inc. v. Peak Computers, Inc., 991 F2d 511,

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17

520

(9th Cir. 1993)

(stating that a permanent

injunction

is

particularly and the

appropriate of

once liability has been established violations remains ongoing);

threat

continuing

Transgo, Inc. v. Ajac Transmission 1022 (9th Cir. 1985)

Parts Corp., may be

768 F.2d 1001, framed to bar

("An injunction

future violations A permanent

that are likely to occur") . injunction is even more necessary where an from

award of damages is insufficient continuing the tortious behavior.

to deter the defendant Balboa,

156 P.3d at 351

(stating that if the court could not award injunctive relief, "a defendant harmed by a continuing pattern of defamation . . . to

would be required to bring a succession deter the defendant Damages either wealthy
(Id.)

of lawsuits

from continuing

the tortious behavior") . when the defendant proof,' or is so

are an insufficient "so impecunious as

deterrent to be

'judgment

as to be willing

to pay

any resulting

judgments."

18 19 20 21 22 23 24 25 26 27 28

Absent undoubtedly Mr. Webster continue

a

permanent

injunction,

Mr.

Webster

will

resume his defamatory testified

e-mail campaign.

Indeed, to

in his deposition Creative.

that he intends Mr. Webster

defaming

Schussler

stated,

"I'm going to tell the public, one way or another, this is the story that's going on. [Mr. Schussler] has a choice of doing

the right thing with us or else I'm going public with this at some point." (Webster Dep. at 200:22-25.) Mr. Webster

specifically stated that he will go public with his story once this lawsuit has ended - "When this is allover, going to decide who was right. the public is of public

This is a matter

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27

record when this is done.

And then there is the book.6

If

Mr. Schussler does not understand we're not playing nice, either."

that he's not playing nice, Mr. Webster has stated "[Mr.

Schussler] has placed us in the position of having NOTHING to lose" and that he plans to "poison the well" by defaming By his

Schussler Creative.

(Id. at ~ 25; PI.'s Ex. 9 at 4-5.)

own words, Mr. Webster has established

that nothing short of

a court order will prevent him from continuing to assert that Mr. Schussler has stolen Hot Dog Hall of Fame from him. Indeed, the necessity been proven once before, motion for a temporary for court intervention has already in relation injunction. to Schussler Creative's Initially, Schussler

Creative contacted Mr. Webster to request that he stop sending defamatory e-mails. Instead, however, Mr. Webster continued e-mails and to post defamatory on his website, Complaint. Court statements

to send defamatory about Schussler

Creative

even after he was (Schussler Decl. a preliminary

served with Schussler ~~ 24,28.) Only

Creative's after this

issued

injunction did Mr. Webster remove the defamatory material from his website and cease sending defamatory e-mail messages. As

before, a court order is necessary to prevent Mr. Webster from following through on his threats statements of "going public" with his or otherwise interfering in

false and defamatory

28

6 The "book" Mr. Webster is referring to is a work-inprogress that Mr. Webster is creating. The book is comprised largely of various segments from different issues of the Frankfurter Chronicles. (Webster Dep. At 99:10-16, 100:11-12.)

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2

Schussler

Creative's

legitimate

business

enterprises.

See

Balboa, 156 P.3d at 350-53. In addition, monetary damages a permanent are injunction to is necessary because Mr. Webster from

3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

unlikely

deter

continuing his tortious activity.

Schussler Creative is well

aware that Mr. Webster is probably not in a financial position to pay the damages for which he is liable. If Schussler is essentially there will

Creative's

hunch is correct, then Mr. Webster Absent a permanent

"judgment proof."

injunction,

be nothing preventing Mr. Webster from resuming his defamatory campaign permanent Schussler against Schussler Creative. Consequently, a

injunction is all the more necessary to ensure that Creative sustains no further injury. See Balboa,

156 P.3d at 151. Accordingly, order a permanent Schussler Creative requests that this Court injunction barring Mr. Webster from further

publishing his defamatory statements or otherwise interfering with Schussler Creative's business enterprises.

CONCLUSION For each respectfully of the requests foregoing reasons, Schussler Creative for

that this Court GRANT

its Motion

Summary Judgment

in its entirety. JAMES P. COLLINS, JR. COTKIN & COLLINS A PROFESSIONAL CORPORATION D LLP

DATED: June 27, 2008

26 27 28

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