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Trademark Trial and Appeal Board Electronic Filing System. http://estta.uspto.gov
ESTTA Tracking number: ESTTA1069514
Filing date: 07/20/2020
IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
Proceeding 92073516
Party PlaintiffPentigus Industries, LLC
CorrespondenceAddress
MATTHEW J LADENHEIMTREGO HINES & LADENHEIM PLLC10224 HICKORYWOOD HILL AVEHUNTERSVILLE, NC 28078UNITED STATESPrimary Email: [email protected] Email(s): [email protected]
Submission Opposition/Response to Motion
Filer's Name Matthew J. Ladenheim
Filer's email [email protected], [email protected]
Signature /Matthew J. Ladenheim/
Date 07/20/2020
Attachments 1529-001.RMSJ.pdf(89995 bytes )1529-001.RMSJ.EX1.pdf(2088679 bytes )1529-001.RMSJ.EX2.pdf(4313602 bytes )1529-001.RMSJ.EX3.pdf(3006901 bytes )1529-001.RMSJ.EX4.pdf(2408843 bytes )1529-001.RMSJ.EX5.pdf(693937 bytes )
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IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
In Re Registration: 5,928,813
Mark: DANNY’S PIZZA + Design
____________________________________
)
PENTIGUS INDUSTRIES, LLC )
)
Petitioner, ) Cancellation No 92073516
)
vs. )
)
DANIEL LAFRANCA )
)
Registrant. )
____________________________________)
PETITIONER’S RESPONSE IN OPPOSITION TO
REGISTRANT’S MOTION FOR SUMMARY JUDGMENT
COMES NOW the Petitioner Registrant, by and through its legal counsel, and submits
the following Response in Opposition to Registrant’s Motion for Summary Judgment.
Preliminary Statement
The entirety of Petitioner’s case is predicated on the patently absurd assertion that
its sale of the DANNY’S PIZZA & PASTA restaurant, together with trademarks and
goodwill, was, in fact, not an assignment, but merely a licensing agreement. Undeterred
by the fact that the sales document specifically contemplates assignment of the mark, and
further undeterred by the fact that sales document is devoid of any of the indicia of
license, or, indeed, even the word license, Registrant nevertheless asserts that a secret ill-
defined “oral license”, operating outside the meets and bounds of the four corners of the
contract, actually reflects the true intent of the parties and that the transfer should be
treated as a license not an assignment. Leaving aside the fact that such an argument is
2
based on impermissible parol evidence of the most garden variety, it simply isn’t true.
RBM has provided a sworn declaration that the oral license imagined by Registrant never
existed.
Registrant’s dogged assertion that it retained ownership of the mark, and thus,
priority, at best evidences a serious case of seller’s remorse. At worst, it evidences an
intentional misrepresentation to the USPTO. The simple fact of the matter is that there is
only one DANNY’S PIZZA & PASTA location that has been in continuous operation
since 2013; and it is not the location owned by Registrant. Rather, it is the location
owned by the Petitioner.
Registrant is quite correct that this case does not present any genuine issue of
material fact; but it is woefully mistaken with respect to which party is entitled to relief as
a matter of law.
Standard of Review
Federal Rule of Civil Procedure 56 provides that “The court shall grant summary
judgment if the movant shows that there is no genuine dispute as to any material fact and
the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). The movant
has the “initial responsibility of informing the district court of the basis for its motion,
and identifying those portions of ‘the pleadings, depositions, answers to interrogatories,
and admissions on file, together with the affidavits, if any,’ which it believes demonstrate
the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317,
323 (1986). “Once the moving party makes a Rule 56 motion, ‘[t]he burden is on the
nonmoving party to show that there is a genuine issue of material fact for trial ... by
offering sufficient proof in the form of admissible evidence ....’” Variety Stores, Inc. v.
3
Wal-Mart Stores, Inc., 888 F.3d 651, 659 (4th Cir. 2018) (citing Guessous v. Fairview
Prop. Invs., LLC, 828 F.3d 208, 216 (4th Cir. 2016) (internal quotes omitted).
By its very terms, Rule 56 provides that to defeat a summary judgment motion,
the non-movant must present a genuine issue of material fact – the mere existence of a
minor factual dispute is insufficient to defeat a proper summary judgment motion. For
instance, the Fourth Circuit Court of Appeals has specifically held:
[T]he non-moving party must do more than present a “scintilla” of
evidence in its favor. Anderson, 477 U.S. at 252, 106 S.Ct. at 2512.
Rather, the non-moving party must present sufficient evidence such that
“reasonable jurors could find by a preponderance of the evidence” for the
non-movant, Anderson, 477 U.S. at 252, 106 S.Ct. at 2512, “for an
apparent dispute is not ‘genuine’ within contemplation of the summary
judgment rule unless the non-movant's version is supported by sufficient
evidence to permit a reasonable jury to find the fact[s] in his favor.” Stone
v. University of Maryland Medical Sys. Corp., 855 F.2d 167, 175 (4th Cir.
1988). Thus, if the evidence is “merely colorable” or “not significantly
probative,” a motion for summary judgment may be granted. Anderson,
477 U.S. at 249-50, 106 S.Ct. at 2510-11.
Sylvia Development Corp. v. Calvert County, Md., 48 F.3d 810, 818 (4th Cir. 1995).
It is certainly true that when considering a motion for summary judgment, the
court must view the evidence and any inferences from the evidence in the light most
favorable to the nonmoving party. Id. However, it is also true that only reasonable
inferences must be drawn. Again, the Fourth Circuit Court of Appeals opinion in Sylvia
Development Corp. is instructive:
Permissible inferences must still be within the range of reasonable
probability, however, and it is the duty of the court to withdraw the case
from the jury when the necessary inference is so tenuous that it rests
merely upon speculation and conjecture.
Id. (citing Ford Motor Co. v. McDavid, 259 F.2d 261, 266 (4th Cir. 1958), cert. denied,
358 U.S. 908, 79 S.Ct. 234, 3 L.Ed.2d 229 (1958)).
4
Factual background
In April of 2013, Registrant, as sole owner and president of LAAN CORP.
established a business known as "DANNY'S PIZZA & PASTA” (hereinafter, the
"Business") located at 2435 West Hwy 160 Suite 112, Tega Cay, SC 29708. On June 17,
2016, LAAN CORP. sold all right, title and interest in and to the Business, specifically
including the mark DANNY'S PIZZA & PASTA and the goodwill associated therewith,
to FM-DANNYS-BROKAT, LLC (hereinafter, “FMDB”). Thereafter, LAAN CORP.
ceased offering restaurant services under the mark DANNY'S PIZZA & PASTA. Indeed,
LAAN CORP. and Daniel LaFranca exited the restaurant business entirely. The Offer to
Purchase and the Bill of Sale specifically conveyed the business, the goodwill, and the
trademarks.
After acquiring the business, FMDB continued to operate the restaurant with the
assistance of its manager, Daniel Margies. See Declaration of Rodger Blake-Ward
attached hereto as Exhibit 1. Significant changes were made to the business and its
operations. (EX1 ¶8). For example, the company hanged food vendors, printed new
menus and changed up the look of its advertising. (EX1 ¶8). It replaced several major
appliances and rearranged the kitchen floorplan. (EX1 ¶8). It purchased and replaced the
dining room furniture, repainted and rearranged the dining room and all art work. (EX1
¶8). All of the changes were visible to the public as was the announcement to the public
and anyone inquiring that the business had been sold and Mr. LaFranca was no longer
involved. (EX1 ¶9). Mr. LaFranca was not consulted or informed about any of the
changes as his business expertise was not needed, welcomed or expected in any way.
(EX1 ¶9).
5
As time passed, the business continued to grow. In 2017 FMDB purchased
another Pizzeria that was being offered for sale located in downtown Fort Mill. (EX1
¶10). FMDB purchased the business, staffed it with current DANNY’S PIZZA &
PASTA Tega Cay staff, replaced the storefront sign with one that advertised the new
location as “DANNY’S PIZZA,” changed the menu to reflect a scaled down version of
products being offered at DANNY’S PIZZA & PASTA Tega Cay, and started social
media accounts describing and differentiating the new business as Danny’s Downtown
Fort Mill. (EX1 ¶10).
In 2018, FMDB decided to sell the DANNY’S PIZZA location in Fort Mill. (EX1
¶11). After receiving several inquiries and showing the restaurant FMDB received
interest from Mr. LaFranca who stated that he was ready to get back into the pizza
business as an absentee owner so that he could continue his career working at Home
Depot in Charlotte, NC. (EX1 ¶11). Conversations were had between Mr. LaFranca and
Mr. Margies about delivery boundaries, maintaining a separation for customers between
one location and another and possible advertising partnerships. (EX1 ¶11).
The Bill of Sale which transferred the Fort Mill restaurant to Mr. LaFranca
included geographically bounded rights in the name DANNY’S PIZZA. (EX1 ¶12).
Specifically, the Bill of Sale indicated that Mr. LaFranca would be permitted to use the
name at the Fort Mill location only, and that FMDB was retaining rights as to any other
location. (EX1 ¶12). The same day that Mr. LaFranca purchased the Fort Mill location,
he filed a federal trademark application to register the mark DANNY’S PIZZA claiming
a date of first use of 2013.
6
Several months after FMBD sold the DANNY’S PIZZA Fort Mill location to Mr.
LaFranca, it sold the original DANNY’S PIZZA & PASTA Tega Cay restaurant to
Daniel and Amber Margies of Pentigus Industries, LLC. (EX1 ¶14). This apparently did
not sit well with Mr. LaFranca who has a history of conflict with former business
associates. (EX1 ¶15). He began harassing and insulting the Margies in an effort to cause
them harm and create an unnecessary volatile competitive atmosphere. (EX1 ¶15).
In late November or early December of 2019, at a meeting in a local Starbucks
coffee house, Mr. LaFranca met with Petitioner claimed to have trademarked “the logo”
but did not provide any evidence in support of the claim. (Rog Rsp). Petitioner first
became aware of the actual existence of United States Trademark Registration No.
5,928,813 in January of 2020 when a representative from Community Savings Magazine
advised Petitioner that it would have to change its logo because Danny LaFranca claimed
to have registered Petitioner’s mark. (Rog Rsp).
Standing
As a preliminary matter, Registrant posits that Petitioner lacks standing to pursue
the present Cancellation Action because it does not own a Federal Registration or
Pending Application. The assertion is wholly devoid of merit.
The purpose of the standing requirement in opposition and cancellation
proceedings is to prevent a “mere intermeddler” from initiating such a
proceeding. This means that to establish standing to petition to cancel, the
petitioner need only be something more than a gratuitous interloper or a
vicarious enforcer of someone else's rights. Since “mere intermeddlers”
only rarely bring such challenges, few proceedings are ever dismissed for
lack of standing and a challenge to standing is usually just a futile
procedural gesture.
7
§ 20:46.Standing to petition to cancel—Standing is generally allowed, 3
McCarthy on Trademarks and Unfair Competition § 20:46 (5th ed.).
No serious argument can be advanced that Petitioner, the owner of the original
DANNY’S PIZZA & PASTA restaurant, the only location that has been in continuous
operation since 2013, is a “mere intermeddler.” Registrant’s spurious standing argument
should be summarily discarded.
ARGUMENT
1. Registrant Assigned the mark to FMDB in totem
The evidence of record plainly shows that LAAN CORP. sold its entire interest in
and to the DANNY’S PIZZA & PASTA restaurant located, Tega Cay, South Carolina,
including the trademarks and the goodwill associated therewith, to FM-DANNY’S-
BROKAT, LLC. Paragraph 1 of Page 1 of the Offer to Purchase, which bears Mr.
LaFranca’s signature, clearly states: “The Buyer agrees to purchase from the Seller the
business assets, all equipment and fixtures, GOODWILL, TRADEMARKS, TRADE
NAMES, recipes, telephone numbers, other intangible assets of that business known as
Danny’s Pizza n Pasta” (emphasis added). See Exhibit 2.
Further, the language enumerated Paragraph 1 of the Bill of Sale includes an
express assignment: “Seller does hereby SELL AND ASSIGN the Assets to Buyer, free
and clear of all liens and encumbrances expressly including the right to use the name
‘Danny’s Pizza & Pasta’ if desired by Buyer.” (emphasis added). Further, enumerated
Paragraph 5 of the Bill of Sale expressly provides that the purchase price included the
goodwill of the business. See Exhibit 3.
8
This transaction was an outright sale, pure and simple. The plain language of the
Offer to Purchase and the Bill of Sale specifically recites that that the entire business, the
good will, AND THE MARK was conveyed. Nothing in the plain language of the Offer
to Purchase or the Bill of Sale states, suggests, or implies that this transaction was
anything other than a sale. Registrant’s assertion to the contrary, and its tortured reading
of these instruments of conveyance, is nothing short of incredible.
Here, the express language of the conveyance documents contemplates
assignment of the mark. But even if the agreement didn’t include an express reference to
the mark, the law presumes that the conveyance of a going concern includes an
assignment of the trademark. As Professor McCarthy has observed:
When a business is sold as a going concern, trademarks and the good will
of the business that the trademarks symbolize are presumed to pass with
the sale of the business. This is an old and clear rule, universally followed.
Even if the words “trademark” or “good will” or similar terms are not
mentioned in the contract of sale of the business, the trademarks of the
business are presumed to pass to the buyer as an essential part of the
business and its good will.
§ 18:37.Implied assignment of mark and transfer of good will in sale of business, 3
McCarthy on Trademarks and Unfair Competition § 18:37 (5th ed.). McCarthy cites
myriad Circuit level decisions that stand for this proposition including cases from The
First Circuit, The Second Circuit, The Fourth Circuit, The Fifth Circuit, The Sixth
Circuit, The Seventh Circuit, The Ninth Circuit, The Tenth Circuit, The Eleventh Circuit,
and the Federal Circuit. Id. See, for example, Burgess v. Gilman, 475 F. Supp. 2d 1051,
1055 (D. Nev. 2007), aff'd, 316 Fed. Appx. 542 (9th Cir. 2008) (“Where a business as a
whole is transferred without mentioning the transfer of the mark, it is presumed that the
mark and good will associated with that mark are transferred as well.”); Vaad L'Hafotzas
9
Sichos, Inc. v. Kehot Publication Soc., 935 F. Supp. 2d 595, 600 (E.D. N.Y. 2013)(“[T]he
transfer did not explicitly mention the right to use the logo. That omission is of no
consequence because courts and commentators agree that the transfer of a going concern
implicitly entails the transfer of trademarks and other goodwill.”), later proceedings, 156
F. Supp. 3d 363 (E.D.N.Y. 2016), aff'd 697 Fed. Appx. 63 (2d Cir. 2017); Dovenmuehle
v. Gilldorn Mortg. Midwest Corp., 871 F.2d 697, 700, 10 U.S.P.Q.2d 1550 (7th Cir.
1989) (When an entire business is sold, even if there is no specific mention of a trade
name consisting of a family name, “[a]bsent contrary evidence, a business trade name is
presumed to pass to its buyer.”); Loma Linda Food Co. v. Thomson & Taylor Spice Co.,
47 C.C.P.A. 1071, 279 F.2d 522, 524, 126 U.S.P.Q. 261 (1960) (Sale of the business,
tangible property pertaining to it and “all good will in connection with coffee,” “was
quite sufficient to evidence and to effectuate the intention of the parties to transfer the
trademark.”)
The Fifth Circuit Court of Appeals decision in Uptown Grill, LLC v. Camilla
Grill Holdings, Inc. 920 F.3d 243 (2019) is particularly instructive. That case involved a
factually similar matter where a restaurant owner sold all right title and interest in its
restaurant. Uptown Grill, 920 F.3d at 245. Thereafter the owner purported to license the
mark associated with the restaurant, by way a formal written license agreement, to the
new owner. Id. The Fifth Circuit Court of Appeals found that a plain reading of the Bill
of Sale demonstrated that the original owner had assigned the mark and thus had nothing
to license. Id at 247. Specifically, the Court found:
“A trademark is merely a symbol of goodwill and has no independent
significance apart from the goodwill that it symbolizes.” Sugar Busters
LLC v. Brennan, 177 F.3d 258, 265 (5th Cir. 1999). A trademark “only
gives the right to prohibit the use of it so far as to protect the owner’s good
10
will” and so “cannot be sold or assigned apart from the goodwill it
symbolizes.” Id. (quotation omitted). So, trademarks are “incidents and
appurtenances to businesses and trades. They have no independent
existence ....” Holly Hill Citrus Growers’ Ass’n v. Holly Hill Fruit Prods.,
75 F.2d 13, 15 (5th Cir. 1935); see United Drug Co. v. Theodore Rectanus
Co., 248 U.S. 90, 97, 39 S.Ct. 48, 63 L.Ed. 141 (1918) (holding that it is a
“fundamental error [to suppose] that a trade-mark right is a right in gross
or at large” and that there is “no such thing as property in a trade-mark
except as a right appurtenant to an established business or trade in
connection with which the mark is employed”). Put another way,
“[t]rademark rights do not exist in the abstract, to be bought and sold as a
distinct asset.” Berni v. Int’l Gourmet Rest. of Am., Inc., 838 F.2d 642,
646 (2d Cir. 1988); see also Mister Donut of Am., Inc. v. Mr. Donut, Inc.,
418 F.2d 838, 842 (9th Cir. 1969) (“The law is well settled that there are
no rights in a trademark alone and that no rights can be transferred apart
from the business with which the mark has been associated.”).
Uptown Grill, 920 F.3d 248 (5th Cir. 2019).
A trademark simply does not exist apart from the goodwill of the business with
which it is associated. It is not possible to assign one without the other. Accordingly,
pursuant to the “old and clear rule” discussed by McCarthy above, the Court found when
a business is sold as a going concern, the trademarks and good will are presumed to pass
with the sale. Id. at 248. “Thus, trademark ownership and the related goodwill ‘impliedly
pass[ ] with ownership of a business, without express language to the contrary.’” Id.
(citing Yellowbook Inc. v. Brandeberry, 708 F.3d 837, 844 (6th Cir. 2013)).
Here, the plain language of the Offer to Purchase and Bill of Sale indicate that
FMDB acquired the all of the assets of the restaurant, including the mark and the
goodwill. Further, there is no “express language” in the sales documents which would
permit the Board, or any other adjudicative body, to determine that the old and clear” rule
should not apply.
It is well settled that to retain ownership of a mark after the sale of the business
associated with the mark, the owner’s intent must be “manifest” and some portion of the
11
good will associated with the business must remain with the owner. Id. at 248. “When
selling an entire business, the rights to associated trademarks are necessarily sold unless
at least two conditions are met: (1) the contract expressly reserves some right and interest
in the trademark, and (2) the seller retains some of the business’s goodwill. The latter
condition is the most important, as no rights to trademarks can exist without the related
goodwill.” Uptown Grill, 920 F.3d 248–49.
Neither condition is present in the matter sub judice. There is no express
reservation of right and interest in the mark in the instrument of conveyance. More
importantly, there is no seller retention of goodwill. Quite the contrary. The Bill of Sale
contains a separate line item which specifically provides that seller is conveying the good
will associated with the business. See Exhibit 3.
2. Registrant did not License the Mark to FMDB
As noted above, the plain language of the Offer to Purchase and the Bill of Sale
clearly contemplates the sale of the entirety of the business, the goodwill, and the
associated mark. Notwithstanding, Registrant claims that while it sold the business and
the goodwill outright, it merely granted a license to the mark. However, this ignores the
fact that the instrument of conveyance does not include the requisite (1) express
reservation in the mark, nor does it include the all important (2) reservation of some of
the businesses good will.
It is also curious that the word “license” does not appear anywhere in the Offer to
Purchase or the Bill of Sale. Further, and fatal to the license theory, there are no quality
control provisions in the agreement. Such provisions are essential to the creation of a
license. The sales documents are literally devoid of any indicia of license: no quality
12
control provisions, no territoriality provisions, no exclusivity provisions, no license fee
provisions, and no reservation of rights provisions. In short, there is literally nothing in
the Agreement that intimates, implies or suggests that this was a license as opposed to an
outright sale. Moreover, all of the changes that were made to the restaurant, its menu, its
physical location, were all done without Registrant’s supervision or permission. Indeed,
he was “not consulted or informed about any of the changes as his business expertise was
not needed, welcomed or expected in any way.” (EX1 ¶9).
No matter, Registrant opines, there was a license. Unlike the license agreement in
in Uptown Grill (which the Court voided) the purported license agreement here was
never reduced to writing – it was merely oral. In support of its license theory, Registrant
presents a self-serving declaration that contradicts the plain language of the conveyance.
This “evidence” is impermissible. As the Court observed in Uptown Grill, “the Bill of
Sale unambiguously sold all rights to the []trademarks, and we cannot look to parol
evidence to find otherwise.” Uptown Grill, 920 F.3d at 248.
To the extent the Board is inclined to consider Registrant’s parol evidence, it
should likewise consider the declaration of Rodger Blake-Ward to whom the DANNY’S
PIZZA & PASTA mark was purportedly licensed. Mr. Blake-Ward flatly rejects the
notion that FMDB only received a license to the DANNY’S PIZZA & PASTA mark
when it purchased the restaurant and the attendant goodwill:
It is my understanding that Mr. LaFranca has recently taken the position
that when he sold us the restaurant he retained ownership of the
DANNY’S PIZZA & PASTA trademark and merely granted us “an oral
license.” This is demonstrably false. First, the plain language of the sales
agreement specifically includes a transfer of the trademark. Second, there
is literally nothing in the sales agreement about a license: no territory
restrictions, no quality control provisions, no license fee, nothing. Third, I
13
would never enter into an oral licensing agreement. As a long-time
franchisee of a nationally known restaurant chain (Jeresey Mike’s) I am
well aware of the complexities of a formal trademark license. There was
never any oral licensing agreement as Mr. LaFranca suggests.
(EX1, ¶7).
The plain language of the conveyance contemplates an express assignment of the mark to
FMDB. Mr. LaFranca cannot manufacture a license out of the ether. Simply saying a
license exists does not make it so. Particularly where, as here, there is not only direct
contractual language to the contrary, but where the purported licensee directly refutes the
allegation of license. This is hardly the stuff of summary judgment.
3. Registrant Only Received Geographically Bounded Rights in the Fort Mill
Location
The plain language of the Bill of Sale which conveyed the Fort Mill location to
Registrant reveals that Registrant only received geographically bounded rights and it
specifically acknowledges that FMDB was retaining rights as to all other locations. The
language of the conveyance provides:
Seller does hereby sell and assign the Assets to Buyer, free and clear of
all liens and encumbrances expressly including the intangible assets of
the Seller, including without limitation, all trade names of the Seller
and other intellectual property, recipes, social media sites and websites,
telephone numbers, and (to the extent transferrable) governmental
permits and licenses, expressly including the right to the use of the
name "Danny's Pizza" if desired by Buyer, but only at this Location
as Seller has retained right to use Danny's Pizza at any other
location.
See Exhibit 4. P 1 (emphasis added).
The assignment of geographically bounded rights to trademarks is absolutely
permissible. See 3 McCarthy on Trademarks and Unfair Competition § 18:21 (5th ed.
14
2018) (“[T]he sale of a geographically separate portion of a marketing business may be
valid as a transfer of a separate and distinct goodwill.”). That said, “the validity of such
an assignment relies on the premise that there exists another portion of the business with
separate and distinct goodwill retained by the seller.” Uptown Grill 920 F. 3d 243 (citing
Ky. Fried Chicken Corp. v. Diversified Packaging Corp., 549 F.2d 368 (5th Cir. 1977);
Greenlon, Inc. of Cincinnati v. Greenlawn, Inc., 542 F.Supp. 890 (S.D. Ohio 1982); Cal.
Wine & Liquor Corp. v. William Zakon & Sons, 297 Mass. 373, 8 N.E.2d 812 (1937)).
Here, the express language of the conveyance reveals that another portion of the business,
with separate and distinct goodwill, was being retained by the seller. Accordingly, this
conveyance cannot be construed as one vesting ownership in the buyer, precisely because
it expressly reserves both trademark rights and separable goodwill.
Moreover, Registrant knew at the time it filed its application to register the
DANNY’S PIZZA mark that it had only acquired limited geographic rights by virtue of
its purchase of the Fort Mill location. Registrant further knew that the Fort Mill business
had only been using the mark DANNY’S PIZZA since 2017. Nevertheless, Registrant
persisted in its registration efforts as if it had never sold its business to FMDB, had never
exited the restaurant business, and was not subject to geographically bounded rights.
4. Petitioner Received Full Rights to the DANNY’S PIZZA & PASTA Mark.
On October 9, 2019, Petitioner purchased the original Tega Cay location from
FMDB. See Exhibit 5. This Asset Purchase Agreement assigned substantially all of the
assets of the business, specifically including “any and all good will in and going concern
value of the Business. Id. at ¶1.2(h). There is no express reservation of right and interest
in the mark in the instrument of conveyance. More importantly, there is no seller
15
retention of goodwill. As discussed in Section 1 above, “trademark ownership and the
related goodwill ‘impliedly pass[ ] with ownership of a business, without express
language to the contrary.’” Yellowbook Inc. v. Brandeberry, 708 F.3d 837, 844 (6th Cir.
2013). Accordingly, pursuant to the “old and clear rule”, when Petitioner purchased the
going concern of FMDB, ownership of the DANNY’S PIZZA & PASTA mark passed to
Petitioner.
5. Likelihood of Confusion
The parties appear to be in agreement on one thing, a likelihood of consumer
confusion exists as between DANNY’S PIZZA & PASTA and DANNY’S PIZZA. This
case turns on ownership and priority, not on likelihood of confusion.
CONCLUSION
In 2013 Danny LaFranca opened a successful pizzeria in Tega Cay under the
trademark DANNY’S PIZZA & PASTA. Several years later, Mr. LaFranca sold the
business, in its entirety, specifically including the trademarks and the good will, to
FMDB. The plain language of the conveyance makes clear that the DANNY’S PIZZA &
PASTA mark was included in the sale. After the sale, Mr. LaFranca exited the restaurant
business entirely. FMDB was able to grow the business to multiple locations.
Eventually, it sold its secondary location, and only the secondary location, to Mr.
LaFranca.
As per the express language of the sale, Mr. LaFranca assumed the secondary
location subject to geographically bounded trademark rights and specifically recognized
that FMDB retained rights in the mark in all other locations. FMDB subsequently sold
16
the entirety of its business to Petitioner, thus vesting ownership of the DANNY’S PIZZA
& PASTA mark in Petitioner.
Registrant’s claim of the existence of an oral license is inconsistent with known
principles of intellectual property law. When Registrant sold the business to FMDB, he
sold it completely and left the restaurant business. He never exercised any rights
traditionally associated with a licensor, and FMDB, the purported licensee, specifically
denies the existence of a license. Registrant’s acquisition of the Fort Mill located
specifically came with geographically bounded rights – something Registrant would
prefer the Board to simply ignore.
Petitioner respectfully submits that the plain language of instruments of
conveyance at issue in this case clearly demonstrates that Registrant is not entitled to
summary judgment. Indeed, quite the opposite is true.
Respectfully Submitted,
This the 20th day of July, 2020.
TREGO, HINES & LADENHEIM, PLLC
____________________________________
Matthew J. Ladenheim
N.C. Bar No. 29309
Trego, Hines & Ladenheim, PLLC
10224 Hickorywood Hill Ave, Suite 202
Charlotte, NC 28078
Telephone: (704) 599-8911
Facsimile: (704) 464-1084
Counsel for Petitioner
17
CERTIFICATE OF SERVICE
I hereby certify that a copy of the forgoing PETITIONER’S RESPONSE IN
OPPOSITION TO REGISTRANT’S MOTION FOR SUMMARY JUDGMENT was
duly served on counsel for Registrant by electronic mail addressed as follows:
COOPER LEGAL, LLC
Respectfully Submitted,
This the 20th day of July, 2020.
TREGO, HINES & LADENHEIM, PLLC
____________________________________
Matthew J. Ladenheim
N.C. Bar No. 29309
Trego, Hines & Ladenheim, PLLC
10224 Hickorywood Hill Ave, Suite 202
Charlotte, NC 28078
Telephone: (704) 599-8911
Facsimile: (704) 464-1084
Counsel for Petitioner
EXHIBIT I
1
IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE TRADEMARK TRIAL AND APPEAL BOARD
In Re Registration: 5,928,813
Mark: DANNY’S PIZZA + Design
____________________________________
)
PENTIGUS INDUSTRIES, LLC )
)
Petitioner, ) Cancellation No 92073516
)
vs. )
)
DANIEL LAFRANCA )
)
Registrant. )
____________________________________)
DECLARATION OF RODGER BLAKE-WARD
I, Rodger Blake-Ward, have personal knowledge of the facts and events described herein.
Having been duly sworn in accordance with law, and under penalty of perjury, I hereby
state:
1. My name is Rodger Blake-Ward. I am an experienced restaurateur in the Fort
Mill/Tega Cay area. I purchased the DANNY’S PIZZA & PASTA located in
Tega Cay, South Carolina from Daniel LaFranca and I ultimately sold it to Dan
and Amber Margies of Pentigus Industries, LLC.
2. In 2016 I noticed an advertisement from National Restaurant Properties on the
business brokering website BizBuySell.com for a locally owned restaurant in the
Fort Mill/Tega Cay area. I inquired about the listing with business broker
Sherman Walters and arranged an in-person meeting to view the restaurant. The
business for sale turned out to be a Pizzeria my wife and I frequented and we were
both interested in pursuing the opportunity to purchase the restaurant.
3. I met with Sherman and then current owner of DANNY’S PIZZA & PASTA at
2435 W. Hwy. 160, Danny LaFranca. We were told that Mr. LaFranca was selling
the business because he was no longer interested in operating the pizzeria and was
only minimally involved in the day-to-day operations at that time.
4. We then requested a meeting with Mr. LaFranca’s Operating Manager, Daniel
Margies. Knowing that we would not be able to be owner/operators it was a
requirement for us that Mr. Margies remain as our Operating Manger and
continue to run the day-to-day operations along with our guidance. After speaking
2
with Mr. Margies about his role as being the “face” of the business and being
given the permission to make decisions about menu options, advertising and other
matters he agreed to stay on and help us run the business.
5. We purchased the restaurant on June 17, 2016 by signing all required documents
at Mr. Walters NRP offices. After the document signing we shook hands with Mr.
LaFranca and had no plans to see or work with him again aside from one week
during that first summer that Mr. LaFranca agreed to work for pay so that Mr.
Margies could go on a previously planned week long vacation.
6. During the one week that Mr. LaFrance worked for us, the staff informed us that
Mr. LaFranca verbally scoffed at the changes we had made as the new owners
along with Mr. Margies’ guidance and claimed that we would be out of business
within 6 months. After that week we were not aware of Mr. LaFranca entering the
business again with the exception of maybe coming in as a customer once or
twice.
7. It is my understanding that Mr. LaFranca has recently taken the position that
when he sold us the restaurant he retained ownership of the DANNY’S PIZZA &
PASTA trademark and merely granted us “an oral license.” This is demonstrably
false. First, the plain language of the sales agreement specifically includes a
transfer of the trademark. Second, there is literally nothing in the sales agreement
about a license: no territory restrictions, no quality control provisions, no license
fee, nothing. Third, I would never enter into an oral licensing agreement. As a
long-time franchisee of a nationally known restaurant chain (Jeresey Mike’s) I am
well aware of the complexities of a formal trademark license. There was never
any oral licensing agreement as Mr. LaFranca suggests.
8. Upon purchasing the restaurant, we reviewed the little data we had from the Point
of Sale system and made changes to the menu based on past sales. We changed
food vendors, printed new menus and changed up the look of our advertising. We
replaced several major appliances and rearranged the kitchen floorplan. We
purchased and replaced the dining room furniture, repainted and rearranged the
dining room and all art work. Over the few years we owned the business we made
many changes to the appearance and operations of the restaurant resulting in
higher sales and efficiency.
9. All of the changes were visible to the public as was the announcement to the
public and anyone inquiring that the business had been sold and Mr. LaFranca
was no longer involved. Mr. Margies worked tirelessly towards the success of the
business and was compensated accordingly. Mr. LaFranca was not consulted or
informed about any of the changes as his business expertise was not needed,
welcomed or expected in any way.
10. In 2017 we became aware of another Pizzeria that was being offered for sale
located in downtown Fort Mill. Upon investigation we found a small restaurant
3
that we felt would perfectly compliment our current business by being able to
offer our product to residents of another part of town that we could not currently
serve due to the driving distance being too far for our delivery drivers and
customers unwilling to fight through local traffic to travel to Tega Cay often
enough. We purchased the business, staffed it with some of our current
DANNY’S PIZZA & PASTA Tega Cay staff, replaced the storefront sign with
one that advertised us as “DANNY’S PIZZA,” changed the menu to reflect a
scaled down version of our products being offered at DANNY’S PIZZA &
PASTA Tega Cay, and started social media accounts describing and
differentiating the new business as Danny’s Downtown Fort Mill. The new
restaurant used the same menu design, pizza boxes and delivery driver car toppers
as DANNY’S PIZZA & PASTA in Tega Cay. This new location was located very
close to Mr. LaFranca’s home and would have been impossible for him to not see
often.
11. In 2018 we decided that due to an inability to staff the new location and achieve
the sales we desired to keep the operation running we put the business up for sale.
After receiving several inquiries and showing the restaurant we received interest
from Mr. LaFranca who contacted us and stated that he was ready to get back into
the pizza business as an absentee owner so that he could continue his career
working at Home Depot in Charlotte, NC and he wanted to purchase this
business. Conversations were had between Mr. LaFranca and Mr. Margies about
delivery boundaries, maintaining a separation for customers between one location
and another and possible advertising partnerships.
12. The Bill of Sale which transferred the Fort Mill restaurant to Mr. LaFranca
included geographically bounded rights in the name DANNY’S PIZZA.
Specifically, the Bill of Sale indicated that Mr. LaFranca would be permitted to
use the name at the Fort Mill location only, and that I was retaining rights as to
any other location.
13. When Mr. LaFranca purchased and took over the operations of DANNY’S PIZZA
he announced himself to the community as being “back,” and made immediate
and major changes to his menu and the operation of DANNY’S PIZZA further
differentiating himself from DANNY’S PIZZA & PASTA in Tega Cay.
14. In 2019 my wife and I decided that because Mr. Margies wife, Amber was able to
begin working for DANNY’S PIZZA & PASTA in Tega Cay full-time and as a
family they were putting in so much time and effort to making the restaurant a
success, we wanted to offer them the opportunity to purchase the business and run
it as their own. Amber’s brother also worked full-time for the restaurant and it just
made sense to allow this family to flourish as the business owners they deserved
to be. We negotiated a price and sold DANNY’S PIZZA & PASTA in Tega Cay
to Daniel and Amber Margies and watched proudly as they put their own stamp
on the business. The customer base immediately became excited for them, and
their story.
EXHIBIT II
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TGIKUVTCPV.113
TGIKUVTCPV.114
EXHIBIT III
TGIKUVTCPV.115
TGIKUVTCPV.116
TGIKUVTCPV.117
TGIKUVTCPV.118
TGIKUVTCPV.119
TGIKUVTCPV.11;
EXHIBIT IV
TGIKUVTCPV.239
TGIKUVTCPV.23;
TGIKUVTCPV.241
TGIKUVTCPV.242
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EXHIBIT V
Pentigus v. LaFranca
TTAB 92073516
PENT000087
Pentigus v. LaFranca
TTAB 92073516
PENT000088
Pentigus v. LaFranca
TTAB 92073516
PENT000089
Pentigus v. LaFranca
TTAB 92073516
PENT000090
Pentigus v. LaFranca
TTAB 92073516
PENT000091
Pentigus v. LaFranca
TTAB 92073516
PENT000092
Pentigus v. LaFranca
TTAB 92073516
PENT000093
Pentigus v. LaFranca
TTAB 92073516
PENT000094
Pentigus v. LaFranca
TTAB 92073516
PENT000095
Pentigus v. LaFranca
TTAB 92073516
PENT000096
Pentigus v. LaFranca
TTAB 92073516
PENT000097
Pentigus v. LaFranca
TTAB 92073516
PENT000098
Pentigus v. LaFranca
TTAB 92073516
PENT000099
Pentigus v. LaFranca
TTAB 92073516
PENT000100
Pentigus v. LaFranca
TTAB 92073516
PENT000101
