Slep's answer (PDF)




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Title: UNITED STATES DISTRICT COURT
Author: Catherine

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CASE 0:14-cv-04737-PJS-FLN Document 17 Filed 03/03/15 Page 1 of 32

UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
SLEP-TONE ENTERTAINMENT
CORPORATION,

Civil Action No.: 0:14-cv-04737
(PJS/FLN)

Plaintiff,
v.
HEATHER LAPADAT d/b/a TWIN CITY
KARAOKE
Defendant.

SLEP-TONE ENTERTAINMENT
CORPORATION’S MEMORANDUM
IN OPPOSITION TO DEFENDANT’S
MOTION TO DISMISS UNDER FED.
R. CIV. P. 12(b)(6)

CASE 0:14-cv-04737-PJS-FLN Document 17 Filed 03/03/15 Page 2 of 32

TABLE OF CONTENTS
INTRODUCTION.............................................................................................................6
FACTUAL BACKGROUND...........................................................................................6
A.

Slep-Tone’s Right......................................................................................6

1.

Slep-Tone is the owner of U.S. Trademarks, U.S. Service Marks, and trade
dress for use in connection with its karaoke tracks...................................6

2.

Slep-Tone sells karaoke tracks using the SOUND CHOICE marks and
Trade Dress................................................................................................7

B.

Lapadat’s Activities...................................................................................9

C.

Allegations in the Complaint....................................................................10

ARGUMENT....................................................................................................................12
I.

II.

III.

LEGAL STANDARD..........................................................................................12
A.

Pleadings Standard...................................................................................12

B.

Motion to Dismiss.....................................................................................12

SLEP-TONE PLED SUFFICIENT FACTUAL CONTENT TO STATE A
CLAIM OF VIOLATION OF THE LANHAM ACT, MINNESOTA UNIFORM
DECEPTIVE TRADE PRACTICES ACT, AND COMMON LAW UNFAIR
COMPETITION THAT IS PLAUSIBLE ON ITS FACE...................................13
A.

Slep-Tone pled sufficient factual content to support claims that are facially
plausible....................................................................................................13

B.

Slep-Tone’s allegations against Lapadat set forth the required elements of
trademark infringement, trade dress infringement, violation of the
Minnesota Uniform Deceptive Trade Practices Act, and unfair
competition...............................................................................................15

1.

Slep-Tone sufficiently pled that Lapadat used the SOUND CHOICE marks
and Trade Dress in commerce..................................................................15

2.

Lapadat’s display of the SOUND CHOICE marks and Trade Dress during
karaoke shows constitutes use in commerce.............................................17

3.

Slep-Tone sufficiently pled that Lapadat used the SOUND CHOICE marks
in connection with both goods and services..............................................19

C.

Slep-Tone sufficiently pled that Lapadat’s infringing use of the SOUND
CHOICE marks and Trade Dress creates a likelihood of confusion.........20

D.

Slep-Tone pled sufficient facts to recover remedies for counterfeiting....22

SLEP-TONE’S ALLEGATIONS ARE NOT PREEMPTED BY THE
COPYRIGHT ACT..............................................................................................25
A.

Slep-Tone’s federal causes of action do not fall under National Car Rental
System and are not preempted by the Copyright Act................................25

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CASE 0:14-cv-04737-PJS-FLN Document 17 Filed 03/03/15 Page 3 of 32

B.

None of Slep-Tone’s federal or state law causes of actions are preempted
by the Copyright Act, as Slep-Tone’s allegations are based on Lapadat’s
infringing use of the SOUND CHOICE marks and Trade Dress..............26

C.

Slep-Tone has repeatedly defeated claims of copyright preemption.........28

CONCLUSION................................................................................................................32

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CASE 0:14-cv-04737-PJS-FLN Document 17 Filed 03/03/15 Page 4 of 32

TABLE OF AUTHORITIES
Cases
Ashcroft v. Iqbal,
556 U.S. 662, 129 S. Ct. 1937 (2009)...............................................................................12
Bell Atlantic Corp. v. Twombly,
550 U.S. 544, 127 S. Ct. 1955 (2007)..........................................................................12-13
Braden v. Wal-Mart Stores, Inc.,
588 F.3d 585 (8th Cir. 2009).....................................................................13-14, 16, 19-20
Dastar Corporation v. Twentieth Century Fox Film Corporation,
539 U.S. 23 (2003)............................................................................................................29
In re Red Robin Enters.,
222 U.S.P.Q. 911 (T.T.A.B. 1984).............................................................................17, 23
National Car Rental System, Inc. v. Computer Associates International, Inc.,
991 F.2d 426 (8th Cir. 1993).....................................................................................25, 28
Scheuer v. Rhodes,
416 U.S. 232, 94 S. Ct. 1683 (1974)..................................................................................13
Slep-Tone Entertainment Corporation v. Arrowood, et al.,
No. 2:10-cv-592, 2011 WL 4482082 (S. D. Ohio Sept. 26, 2011)....................................29
Slep-Tone Entertainment Corporation v. Canton Phoenix Inc.
No. 3:14-cv-00764-PK, 2014 WL 5817903 (D. Or. Nov. 7, 2014).............................29-31
Slep-Tone Entertainment Corporation v. Coyne, et al.,
No. 13 C 2298, 2014 WL 1848735 (N. D. Ill. May 8, 2014).......................................28-30
Slep-Tone Entertainment Corporation v. Elwood Enterprises, Inc.,
No. 13 C 7346, 2014 WL 1612891 (N. D. Ill. April 21, 2014).........................................30
Slep-Tone Entertainment Corporation v. Grillhouse, Inc., et al.,
No. 6:13-cv-02016-TC (D. Or. Jan. 30, 2015)...................................................................31
Slep-Tone Entertainment Corporation v. Shenanigans Lounge, et al.,
No. 6:12-cv-1236-TC, 2013 WL 1768444 (D. Or. Feb. 22, 2013)....................................29

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CASE 0:14-cv-04737-PJS-FLN Document 17 Filed 03/03/15 Page 5 of 32

Tellabs, Inc. v. Makor Issues & Rights, Ltd.,
127 S. Ct. 2499 (2007).......................................................................................................13

Rules
Federal Rule of Civil Procedure 8(a)(2)............................................................................12
Federal Rule of Civil Procedure 12(b)(6).....................................................................6, 12
Statutes
15 U.S.C. §1051 et seq. .............................................................................................passim
15 U.S.C. § 1058................................................................................................................24
15 U.S.C. §1125(a)............................................................................................................24
15 U.S.C. §1127..........................................................................................................17, 23
17 U.S.C. §§101-106....................................................................................................25-31

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CASE 0:14-cv-04737-PJS-FLN Document 17 Filed 03/03/15 Page 6 of 32

INTRODUCTION
Plaintiff Slep-Tone Entertainment Corporation (hereinafter “Slep-Tone”) opposes
Defendant Heather Lapadat’s (hereinafter “Lapadat”) Motion to Dismiss under Federal
Rule of Civil Procedure 12(b)(6). Slep-Tone’s Complaint pled actionable claims for
trademark infringement, trade dress infringement, counterfeiting, and unfair competition
under the Lanham Act; violation of the Minnesota Uniform Deceptive Trade Practices
Act; and common law unfair competition. Further, Slep-Tone’s claims are not preempted
by the Copyright Act. Slep-Tone respectfully requests that this Court deny Lapadat’s
motion to dismiss.
FACTUAL BACKGROUND
A.

Slep-Tone’s Rights
1.

Slep-Tone is the owner of U.S. Trademarks, U.S. Service Marks, and
trade dress for use in connection with its karaoke tracks

Slep-Tone is a North Carolina corporation manufacturing and distributing karaoke
tracks sold under the mark SOUND CHOICE. (Compl. ¶¶ 6, 10, Doc. No. 1, pp. 2-3).
Slep-Tone owns U.S. Trademark Registration Number 1,923,448 for the mark SOUND
CHOICE for “pre-recorded magnetic audio cassette tapes and compact discs containing
musical compositions and compact discs containing video related musical compositions”;
U.S. Service Mark Registration Number 4,099,045 for the mark SOUND CHOICE for
“conducting entertainment exhibitions in the nature of karaoke shows”; U.S. Trademark
Registration Number 2,00,725 for the design mark reproduced below for “pre-recorded
magnetic audio cassette tapes and compact discs containing musical compositions and

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CASE 0:14-cv-04737-PJS-FLN Document 17 Filed 03/03/15 Page 7 of 32

compact discs containing video related musical compositions”; and U.S. Service Mark
Registration No. 4,099,052 for the design mark reproduced below for “conducting
entertainment exhibitions in the nature of karaoke shows” (collectively referred to as the
“SOUND CHOICE marks”). (Compl. ¶¶ 30-33, Doc. No. 1, p. 6).

The SOUND CHOICE marks are indicators of Slep-Tone as the origin of the karaoke
tracks. (Compl. ¶ 35, Doc. No. 1, p. 7).
Slep-Tone also is the owner of distinctive and protectable trade dress (referred to
as the “Trade Dress”) associated with its graphical displays of its karaoke tracks,
including (a) the use of a particular typeface, style, and visual arrangement in displaying
the lyrics; (b) the SOUND CHOICE Marks; and (c) the use of particular styles in
displaying entry cues for singers, namely a series of vanishing rectangles to indicate the
cue. (Compl. ¶ 36, Doc. No. 1, p. 7). The individual and collected elements of the Trade
Dress have acquired secondary meaning as an indicator of Slep-Tone as the source of the
Trade Dress and serves to distinguish Slep-Tone’s karaoke tracks from the tracks of its
competitors. (Compl. ¶¶ 38-39, Doc. No. 1, p. 7).
2.

Slep-Tone sells karaoke tracks using the SOUND CHOICE marks
and Trade Dress

Slep-Tone has gained recognition in the industry as a leading producer of highquality karaoke accompaniment tracks due to its dedication to producing music of the

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CASE 0:14-cv-04737-PJS-FLN Document 17 Filed 03/03/15 Page 8 of 32

highest quality and most authentic character. (Compl. ¶¶ 11-12, Doc. No. 1, p. 3).
Karaoke tracks sold using the SOUND CHOICE marks and trade dress are most
recognizable and sought-after in the industry. (Compl. ¶ 12, Doc. No. 1, p. 3). SlepTone sells compact discs containing karaoke tracks encoded in a special format known as
CD+G (or compact disc plus graphics) that allows for synchronized playback of audio
and video. (Compl. ¶ 14, Doc. No. 1, p. 3). In the past, special players were required to
decode the CD+G format and play the karaoke track. (Compl. ¶ 15, Doc. No. 1, p. 3).
Recently, computer technology has advanced and compact discs in CD+G format can be
decoded and “ripped” (or copied) to a computer hard drive, and special players are no
longer needed to decode the format. (Compl. ¶ 16, Doc. No. 1, p. 3).
Copies of tracks stored on media other than the original compact discs are referred
to as “media-shifted copies.” (Compl. ¶ 17, Doc. No. 1, p. 4). Media-shifting also
frequently involves format-shifting to convert the original format (such as CD+G) to a
different format (such as MP3+G or WAV+G). (Compl. ¶ 18, Doc. No. 1, p. 4). Mediashifting allows tracks to be stored on computer hard drives or external hard drives for
easy transport, but it also leads to the illegal sharing of media-shifted copies.1 (Compl. ¶¶
19-22, Doc. No. 1, p. 4). Illegal sharing of media-shifted copies of karaoke tracks nearly
drove Slep-Tone out of business, as it became easy to obtain illegal media-shifted copies
at little to no cost. (Compl. ¶ 23, Doc. No. 1, p. 4).

1

See paragraph 22 of the complaint for ways in which media-shifting has led to illegal
sharing of tracks. (Compl. ¶ 22, Doc. No. 1, p. 4).
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CASE 0:14-cv-04737-PJS-FLN Document 17 Filed 03/03/15 Page 9 of 32

To combat illegal media-shifting, Slep-Tone established a media-shifting policy
that imposed mandatory rules for karaoke operators who use media-shifted copies of
SOUND CHOICE karaoke tracks.2 (Compl. ¶ 25, Doc. No. 1, p. 5). Slep-Tone’s
authority to require compliance with its media-shifting policy is based in Slep-Tone’s
right to control the commercial use of its federally registered trademarks and, as to some
tracks, its ownership of copyright in the synchronized audiovisual words represented by
and in the sound recordings with those tracks. (Compl. ¶ 27, Doc. No. 1, p. 5). If a
karaoke operator complies with Slep-Tone’s media-shifting policy, that karaoke operator
is granted permission by Slep-Tone to use media-shifted copies of SOUND CHOICE
karaoke tracks, co-extensive with Slep-Tone’s rights in the subject matter. (Compl. ¶ 28,
Doc. No. 1, p. 5). If a karaoke operator fails to comply with Slep-Tone’s media-shifting
policy, Slep-Tone does not permit, authorize, or tolerate that karaoke operator using
media-shifted copies of SOUND CHOICE karaoke tracks. (Compl. ¶ 29, Doc. No. 1, p.
6).
B.

Lapadat’s Activities

Lapadat is the owner of Twin City Karaoke, a company providing karaoke
entertainment to venues in the state of Minnesota. (Compl. ¶¶ 7-9, Doc. No. 1, p. 2).
Lapadat is responsible for the management and operations of Twin City Karaoke.
(Compl. ¶ 9, Doc. No. 1, p. 2). Lapadat performs karaoke shows and relies on one or

2

See paragraph 26 of the complaint for details on Slep-Tone’s media-shifting policy.
(Compl. ¶ 26, Doc. No. 1, p. 5).
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