Tuesday, September 07, 2021

lawyer doesn't make use in commerce by negotiating for client

Big Ligas, LLC v. Yu, 2021 WL 1518993, No. 20-23719-Civ-Scola (S.D. Fla. Apr. 16, 2021)

Big Ligas is owned by three members equally: Daniel Echavarria, also known as Ovy; Christian Andres Salazar; and Paulo Londra. Ovy and Salazar are the managing members, and defendant Yu is an entertainment attorney who represents Londra, an Argentinian “rapper and reggaeton/trap singer.” The parties signed a deal memorandum “to help Londra launch his career as a singer and songwriter.”

Things went well, and then as Londra’s success increased, the parties’ relations deteriorated. Amidst negotiations with other parties about Londra’s second album, Londra hired Yu.

Big Ligas alleged that, among other things, Yu “falsely claimed that she and/or Paulo owned the copyrights that are in fact owned by Big Ligas.”  She allegedly falsely represented that she was authorized to deliver Londra’s “recording artist and songwriting services ... when in fact, any compositions or recordings created under publishing or record deals not authorized by Big Ligas, including those negotiated by Yu, are not commercially exploitable without Big Ligas’[s] authorization, under Paulo’s name or otherwise.”

Big Ligas sued for tortious interference and for false advertising and trademark infringement under the Lanham Act. The tortious interference claims failed for contractual reasons and because Londra’s lawyer was his agent, not a stranger to the contract.

Lanham Act claims: Along with the alleged misrepresentations about authority, Big Ligas alleged that Yu used Londra’s “name and likeness ... to promote his recording services to Warner (and others) and his songwriting services to Kobalt (and others), without Big Ligas’[s] approval or authorization,” confusing third parties.

Yu rejoined that she was, in fact, Londra’s counsel, and using his name was “classical fair use” (that is, descriptive fair use) because “she is not using the name Paulo Londra in the trademark sense, but only to identify her client and describe his relationship to her.” Of course, descriptive fair use requires good faith which sure sounds like it’s hard to decide on a motion to dismiss, but that’s no barrier here. Londra’s stage name and given name are the same [should the result be different if they weren’t?], “and the Plaintiff’s allegations do not prove that Ms. Yu used the Plaintiff’s mark in commerce by referring to and describing her relationship with her client by using his given name.” [Of course this was a use in commerce; in a different situation, this argument would be laughable. Trademark law has ruthlessly been stripped of the tools it needs to say “this is not a trademark claim,” and that’s why the Seventh Circuit approach of just reaching the equitable result can appeal.]

Even if we needed to do a descriptive fair use analysis, Yu would win:

The Court finds that, as Londra’s attorney, Ms. Yu’s use of his name to identify him as her client was other than as a mark, used in the primary descriptive sense, and was undertaken in good faith, that is without the intent to trade on the good will of Big Ligas. To the extent the use of the name Paulo Londra creates some risk of confusion, Big Ligas assumed that risk by establishing Paulo Londra, Londra’s given name by birth, as his stage name. (emphasis added)

This isn’t motion to dismiss language, although it is clearly the right result. 

False advertising: “That Ms. Yu contacted third parties and stated she is Londra’s attorney with authority to negotiate on his behalf is not a false or misleading statement insofar as Ms. Yu was acting on behalf of her client, Londra.” This was a contract dispute, not a Yu problem.

Update: Big Ligas, LLC v. Yu, 2021 WL 4059435, No. 20-23719-Civ-Scola (S.D. Fla. Sept. 7, 2021)

Denying reconsideration, the court added some additional comments, but maybe made things more confusing. False advertising:

[T]he Court is not giving a green light to attorneys everywhere to lie and cheat on behalf of clients. But when an attorney—for the financial benefit of a client—discusses their client and makes representations concerning the scope of their relationship, all while negotiating with another party, that is not a false or misleading “commercial advertisement or promotion” within the meaning of 15 U.S.C. § 1125(a)(1).

In particular, discussions with two third parties that allegedly misrepresented the scope of Yu’s relationship to Londra, weren’t “commercial speech” because they were “in pursuit of her client’s pecuniary interests and the negotiation of a commercial transaction for her client, not herself.” [Comment: um, that’s highly commercial, especially given the court’s appropriate emphasis on the fact that Yu was an agent of her principal, Londra. The court would have been much better served by focusing on “advertising or promotion.”]


To the extent that Big Ligas is concerned that this holding will empower attorneys and their clients to sell property that their clients do not own, the Plaintiff did not cite to any case where that fact pattern constituted a violation of the Lanham Act. There very well may be other causes of action for such conduct, but the Lanham Act is not a catch-all for every purported misrepresentation, particularly those made by a lawyer representing a client in a commercial negotiation.

The court also thought that the Lanham Act wasn’t the right way to attack allegedly false statements “where the falsity of those statements is measured against the interpretation of a contract between the parties (or their agents).” Why not? It’s a contract law dispute. How does that interact with the standard elements of a Lanham Act claim? It doesn’t, which is why the court makes this comment in a footnote—there are Lanham Act cases about whether claims about legal rights can be “false or misleading,” but those cases often hold that statements about legal rights can be falsified, in appropriate circumstances.

Trademark: Also still no.  Big Ligas understandably argued that the court improperly found facts when holding that Yu’s use was “in good faith.” However, assuming the truth of the well-pled allegations, Big Ligas failed to allege any facts from which an inference of bad faith can be drawn, because Yu’s use of the name “Paulo Londra” was “in service of her obligations to her client, Paulo Londra, in order to ‘negotiate and act on behalf of Paulo with respect to his recording artist and songwriting services.’” Of course, this reasoning highlights the extent to which the court’s previous determination that the Lanham Act just didn’t cover this situation is driving the court’s concept of “bad faith.” If, by contrast, some unauthorized distributor had falsely told a buyer that it was authorized to distribute a trademarked product, no court would have trouble finding that the misrepresentation about authorization itself sufficed to infer bad faith (and use as a mark).

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