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Disney not in party mood after knockback in trade mark and copyright claim

Written by Ellis Sweetenham on 16 August 2018

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As possibly one of the biggest brands in the world, Disney has had their fair share of IP matters.

While the majority of the time everything will go their way, the latest claim has not started in the way they hoped.

Disney Enterprises, which includes subsidiaries Marvel Characters and Lucasfilm Entertainment, filed a trade mark and copyright claim against Nick Sarelli in the US in 2016.

The claim centred on the website www.charactersforhire.com through which Sarelli hired out over 3,500 character costumes for events.

These included all of Disney’s main characters as well as superheroes and characters from the Star Wars franchise.

Disney claimed that the operations of the site and Sarelli were liable for ‘depicting or incorporating’ its copyright protected works and trade marks.

As you can imagine Disney has a substantial IP portfolio.

All of the Disney characters are protected by copyright registrations in the US, as well as all those in the Marvel and Star Wars franchise, some of which also subject to trade mark registrations.

In addition, Disney Enterprises owns the exclusive rights to market and license all merchandise which features the characters.

The basis of Disney’s claim is that Characters for Hire has not been authorised to use any of the IP protected characters and this use will have significant impact of the business.

In an attempt to bring the matter to a close. Disney applied to the court for Summary Judgment in respect of the infringement claims, which effectively asks the court to award the case to Disney as Sarelli will not have a defence to the claim. In addition, Disney asked the court for a permanent injunction against Sarelli, as well as damages and costs.

In response, Sarelli asked for summary judgment in his favour and a motion to dismiss.

District Judge George Daniels in the US District Court considered the matter and did not fall down on Disney’s side.

All of Disney’s motions were dismissed, as was some of Sarelli’s.

The Court granted Sarelli’s motion to dismiss Disney’s claim for trade mark infringement, unfair competition and false designation of origin., on the grounds that a likelihood of confusion could not be established.

In addition, Judge Daniels also stated that Disney had failed to show bad faith on Sarelli’s part.

In respect of the remainder of the case, the Judge stated that the trade mark dilution matter was a genuine matter to be considered and this should be considered by a jury in a full trial.

So the matter is not over but it is certainly a blow for Disney.

Watch this space for updates.

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