Professional Documents
Culture Documents
v.
MONIQUE
LLC,
STEWART
and
MNS,
Defendants.
AMENDED COMPLAINT FOR INJUNCTIVE RELIEF
Plaintiff, Tasti D-Lite, LLC (Tasti-D-Lite), by its attorneys, for its
Complaint (Complaint) for Preliminary and Permanent Injunctive Relief against
defendants Monica Stewart (Stewart) and MNS, LLC (MNS) (Stewart and
MNS are collectively referred to as Defendants), states as follows:
Nature of the Action
1.
of the United States, for unfair competition, and for breach of contract. Tasti DLite seeks a preliminary and permanent injunction (i) enjoining Defendants
wrongful and unlawful use of Tasti-D-Lites federally registered trademarks, and
(ii) enforcing certain of the post-termination obligations set forth in the Franchise
Agreement entered into by and between defendant Stewart and Tasti D-Lite.
Parties
2.
principal place of business in Franklin, Tennessee. None of the owners of Tasti DLite are citizens of the State of Georgia. Tasti D-Lite is engaged in the business of,
among other things, granting franchises to qualified persons to operate Planet
Smoothie stores using a distinctive business format, system of operations and
proprietary names and marks.
Smoothie, LLC, an entity that engaged in a similar business, which entered into
franchise agreements for the operation of Planet Smoothie stores, including a
franchise agreement with defendant Stewart.
3.
of the State of Georgia. On information and belief, Stewart is, or at all times
relevant was, an officer and owner of MNS, LLC through which she operated a
franchised Planet Smoothie store at 3560 Camp Creek Parkway, East Point,
Georgia.
4.
liability company, all of whose members are individuals who are citizens and
residents of the State of Georgia, with its principal place of business in Fulton
County, Georgia. On information and belief, all of the owners of MNS are citizens
and residents of the State of Georgia.
Jurisdiction and Venue
5.
This action arises under the Lanham Act, 15 U.S.C. 1051 et seq.,
This Court has original subject matter jurisdiction of this action under
28 U.S.C. 1331, 1338, and 1367, in that this is a civil action involving claims
arising under the laws of the United States, including an Act of Congress relating
to trademarks, and wherein all other claims are so related to claims within the
Courts original jurisdiction that they form part of the same case or controversy.
This Court also has original subject matter jurisdiction of this action under 28
U.S.C. 1332, in that it is a civil action wherein the matter in controversy exceeds
the sum or value of $75,000, exclusive of interest and costs, and is between
citizens of different states.
7.
1391, in that (i) Defendants reside in this judicial district, and (ii) a substantial part
of the events or omissions giving rise to the claims asserted herein occurred in this
judicial district, and because under the terms of the parties Franchise Agreement
Stewart agreed that all state and federal courts in Georgia shall have personal
jurisdiction as to claims permitted to be judicially resolved under the agreement.
Tasti D-Lites Registered Trademarks and Service Marks
8.
uniform system (the Planet Smoothie System) relating to the establishment and
operation of Planet Smoothie Stores. Planet Smoothie Stores sell beverages known
as smoothies, made with frozen yogurt, fresh fruits and vegetables, juices, and
related food and beverage products.
9.
Stores and the products and services they offer, and to distinguish these
restaurants, products, and services from those established, made, offered, and sold
by others, Tasti-D-Lite has extensively used certain trademarks, service marks,
trade names, logos, emblems, and indicia of origin, including, but not limited to,
the name and mark Planet Smoothie (the Planet Smoothie Marks).
10.
the United States Patent and Trademark Office. The registrations of the Planet
Smoothie Marks continue in full force and effect, and all those eligible are
incontestable under Section 15 of the Lanham Act, 15 U.S.C. 1065.
11.
Tasti D-Lite has given notice to the public of the registration of the
Planet Smoothie Marks as provided in 15 U.S.C. 1111. Tasti D-Lite has further
complied with all legal requirements to ensure that it remains the exclusive user of
the Planet Smoothie Marks.
12.
Tasti D-Lite has the exclusive right to use and license the Planet
Smoothie Marks and derivations thereof, as well as the distinctive Planet Smoothie
System through which franchisees offer Planet Smoothie products to the public
under the Planet Smoothie Marks. Pursuant to Franchise Agreements entered into
by and between Tasti D-Lite (and its predecessors-in-interest) and their authorized
and approved franchisees, Tasti D-Lite grants franchises to qualified persons to
own and operate Planet Smoothie Stores using the Planet Smoothie Marks and the
Planet Smoothie System, but only in such manner and at such locations as are
expressly authorized by Tasti D-Lite.
14.
Tasti D-Lite and its franchisees use the Planet Smoothie Marks as the
marks and trade identity by which the products and services offered by Tasti-DLite and its franchisees are distinguished from other food service establishments
and the products and services made and sold by them.
15.
advertised and promoted Planet Smoothie Stores and the products and services
they offer under the Planet Smoothie Marks throughout certain portions of the
United States and through various media. As a result of such efforts and the
considerable money spent in connection therewith, the products and services
offered by Tasti D-Lite and its franchisees under the Planet Smoothie Marks have
met with widespread public approval and have established demand and goodwill
among consumers throughout certain portions of the United States.
The Parties Written Planet Smoothie Franchise Agreement
16.
Planet Smoothie Franchises, LLC, a Georgia limited liability company entered into
a written Planet Smoothie Franchise Agreement (the Franchise Agreement) with
Stewart pursuant to which Planet Smoothie granted Stewart a franchise to operate a
Planet Smoothie Store at 3560 Camp Creek Parkway, East Point , Georgia
(the
Store) and to use the Planet Smoothie System and the Planet Smoothie Marks in
connection therewith, all as fully set forth in the Franchise Agreement. (A true and
correct copy of the Franchise Agreement is annexed hereto as Exhibit A and
incorporated herein by reference.)
17.
make bi-weekly reports of gross sales, and under paragraph 4 of the Franchise
Agreement Stewart agreed to make bi-weekly payments of operating fees or
royalties equal to 5% of gross sales and advertising fees equal to 2% of gross sales.
19.
Agreement, if Stewart fails to submit a report of sales and fails to correct that
failure within thirty (30) days after delivery of written notice of default, or if
Stewart fails to pay any operating fee or advertising fee when due and fails to
correct that default within ten (10) days after written notice.
The Franchise
Agreement may be terminated without opportunity to cure in the event that Stewart
repeatedly (i.e., three or more times during its term) fails to substantially comply
with any of its requirements.
20.
they would, among other things: (i) immediately cease operating the Store and
holding themselves out to the public as present or former Planet Smoothie
franchisees, (ii) immediately and permanently cease using any marks, trade secrets,
signs, symbols, confidential methods, or other materials associated with Planet
Smoothie or belonging to Planet Smoothie; (iii) immediately deliver to Planet
Smoothie the all information, documents, and copies thereof which are proprietary
to Planet Smoothie or relate to the operation of the franchised business; (iv)
immediately cease using the proprietary Planet Smoothie System; and (v) assign to
Planet Smoothie all rights telephone numbers utilized in operating the Store.
21.
agreed that, if franchisor terminated the Agreement for her default she would be
liable to the franchisor for the royalties which it would have received had Stewart
operated the Store for the balance of the term of the Franchise Agreement, based
on the average sales prior to termination.
22.
franchisor incurs expenses to enforce its rights under the Agreement, Stewart
agrees to pay franchisor any such costs, including reasonable attorneys fees.
23.
assigned to Tasti D-Lite in connection with its purchase of the assets of the Planet
Smoothie System, and since that date Tasti D-Lite has had the rights and
obligations of franchisor under the Franchise Agreement.
repeatedly failed to comply with her financial reporting and payment obligations
under the Franchise Agreement. In fact, during the entire time that Tasti D-Lite
has owned the Planet Smoothie franchise network, Stewart has never reported her
sales or paid royalties or ad fees, and Tasti D-Lite was forced to estimate the
amounts due based on the numbers used for similar purposes by the prior owner.
25.
By letter dated January 23, 2013, Tasti D-Lite advised Defendants that
as a result of the failure to pay $12,775 in royalty and ad fees the Franchise
Agreement would be terminated unless Defendants took steps to cure the default
within ten days as provided in the Franchise Agreement. (A copy of the January
23, 2013 Notice of Default is annexed hereto as Exhibit C.)
26.
missing sales reports after she received the default notice. Accordingly, by letter
dated May 8, 2013, Tasti D-Lite advised Defendants that the Franchise Agreement
was terminated, effective immediately. (A copy of the May 8, 2013 Notice of
Termination is annexed hereto as Exhibit D.) The Notice of Termination reminded
Defendants that they were required to comply with the post-termination obligations
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set forth in the Franchise Agreement, including the obligation to cease all use of
the Planet Smoothie Marks.
Defendants Infringement of the Planet Smoothie Marks
27.
Defendants continue to use the Planet Smoothie Marks and the Planet Smoothie
System in connection with the operation of the Store, to market and promote the
Store through the use of the Planet Smoothie Marks, to hold the Store out to the
public as an authorized Planet Smoothie outlet, and to pass-off the Store and the
unapproved products offered by the Store as being authorized by Tasti D-Lite
when they are not.
28.
or consent of Tasti D-Lite and has caused or is likely to cause mistake, confusion,
or deception in the minds of the public as to source, affiliation and sponsorship.
29.
In addition to the fact that both Tasti D-Lite and Defendants offer the
identical products at their Store, the products provided by Defendants using the
Planet Smoothie Marks are offered to the same class of consumers as those who
patronize authorized Planet Smoothie Stores. Upon seeing the familiar Planet
Smoothie Marks through Defendants unauthorized use thereof, consumers will be
deceived into concluding that Defendants Store, and the products and services
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offered and sold in connection therewith, are subject to Tasti D-Lites supervision,
are sponsored or endorsed by Tasti D-Lite, and bear the Planet Smoothie Marks
pursuant to Tasti D-Lites authority and permission.
30.
connection with the operation of the Store, consumers have no practical way of
knowing that Defendants former Planet Smoothie Store is no longer affiliated
with, or sponsored, authorized, or endorsed by, Tasti D-Lite. As a result, any
consumer dissatisfaction with Defendants Restaurant, or with the products and
services offered in connection therewith, will be attributed to Tasti D-Lite and the
entire Tasti D-Lite network.
31.
infringement of the Planet Smoothie Marks and have constructive notice of Tasti
D-Lites rights in the Marks and the registrations thereof pursuant to 15 U.S.C.
1072. Defendants continued infringement is willful, malicious, fraudulent, and
deliberate.
32.
Tasti-D-Lite has at all times complied with and fully performed all of
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COUNT I
LANHAM ACT - TRADEMARK INFRINGEMENT
33.
D-Lite has been and is likely to be substantially injured in its business, including
its goodwill and reputation, resulting in lost revenues and profits and diminished
goodwill.
36.
Smoothie Marks are unique and represent to the public Tasti D-Lites identity,
reputation, and goodwill, such that damages alone cannot fully compensate TastiDLite for Defendants misconduct.
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37.
infringe the Planet Smoothie Marks, to Tasti D-Lites irreparable injury. This
threat of future injury to Tasti-D-Lites business identity, goodwill, and reputation
requires injunctive relief to prevent Defendants continued use of the Planet
Smoothie Marks and to ameliorate and mitigate Tasti D-Lites injury.
COUNT II
LANHAM ACT - UNFAIR COMPETITION
38.
Tasti D-Lite has been and is likely to be substantially injured in its business,
14
including its goodwill and reputation, resulting in lost revenues and profits and
diminished goodwill.
41.
Smoothie Marks are unique and represent to the public Tasti D-Lites identity,
reputation, and goodwill, such that damages alone cannot fully compensate Tasti
D-Lite for Defendants misconduct.
42.
unfairly with Tasti D-Lite, to Tasti D-Lites irreparable injury. This threat of
future injury to Tasti D-Lites business identity, goodwill, and reputation requires
injunctive relief to prevent Defendants continued unfair competition and to
ameliorate and mitigate Tasti D-Lites injury.
COUNT III
BREACH OF CONTRACT POST TERMINATION OBLIGATIONS
43.
obligations under the Franchise Agreement, including their obligations (a) to cease
using the Tasti D-Lite System and the Tasti D-Lite Marks, (b) to de-identify their
former franchised Tasti D-Lite store, (c) to assign to Tasti D-Lite all telephone
15
numbers used in connection with the operation of the former Tasti-D-Lite Store,
and (d) to discontinue all use of any confidential and proprietary information of
Tasti- -Lite.
45.
obligations under the Franchise Agreement, Stewart will continue to breach her
post-termination obligations.
46.
goodwill, and reputation requires that Stewart be ordered to perform her posttermination obligations under the Franchise Agreement to prevent her continued
breach and to ameliorate and mitigate Tasti D-Lites injury.
PRAYER FOR RELIEF
WHEREFORE, Tasti D-Lite respectfully prays for the following relief
against Defendants:
A.
16
agents, servants, and employees, and those people in active concert or participation
with them, from:
1.
2.
3.
Passing off any of their products or services as those of Tasti DLite or its authorized franchisees;
4.
5.
6.
B.
17
2.
C.
under the Planet Smoothie Marks or any other confusingly similar designations
from all media, including, but not limited to, newspapers, flyers, coupons,
promotions, signs, telephone books, telephone directory assistance listings, and
18
That Defendants be required to file with the Court and to serve upon
Tasti D-Lites counsel within ten (10) days after entry of any injunction or order
issued herein, a written report, under oath, setting forth in detail the manner in
which they have complied with such injunction or order; and
F.
Such other and further relief as the Court deems just and proper.
19