In a turn of events that will shock nobody other than perhaps Hard Rock’s lawyers, the iconic brand’s trademark lawsuit against RockStar Hotels has failed miserably. As some folks might recall, when Hard Rock filed its trademark suit more than a year ago, I predicted that this would not end well for Hard Rock.
Once again, my prediction has proven correct. Not because the Eye of Thundera gave me sight beyond sight. But, instead, because the case was really, really stupid and never should have been filed in the first place. Let’s take a moment to refresh everybody’s recollection: In the 1970’s, Hard Rock began as a restaurant chain and eventually got into the hotel and casino business. Everybody knows the Hard Rock logo:
The Defendant, RockStar Hotels, is not an actual hotel brand. Instead, RockStar Hotels considers itself a “luxury travel community”. Members sign up with RockStar Hotels and pay a monthly or yearly fee. The perks of membership include guaranteed low rates, discounts, welcome packages, concierge support and special travel experiences and excursions. That’s it. They are not running a hotel called RockStar Hotel. They are purely a hotel booking and concierge service. They are booking you at places like, e.g., the Hotel Palazzo Zichy in Budapest and giving you a free bottle of champaign and a tour of some local vineyard. Or Gild Hall in New York City, where you get an early check in, late check out and free glass of Prosecco upon arrival. Let’s assume that most people booking hotels are at least 18 years old. Well, anybody who can read at an 8th grade level can review the RockStar Hotels website, read the content contained therein, and easily conclude that they have no affiliation with Hard Rock Hotels.
In spite of this, Hard Rock filed suit in October 2017, arguing that RockStar was confusing consumers by offering “Rock Star Amenities” and “A Rock Star Experience.” Based on Hard Rock’s allegations, one might guess that RockStar was using a similar logo and color scheme, perhaps knocking off Hard Rock’s trade dress. Dead wrong.
To state the obvious: The Rock Star logo looks nothing like the Hard Rock logo. Yes, both companies use the word “Rock”. But the similarities end there. The logos are completely different. The colors are completely different. And although the two companies are both active in the broader hotel space, they are not offering the same product/service.
Sensing the weakness of its position, Hard Rock argued that the real threat of unfair competition and trademark infringement pertained to its “Rock Star Suites” product. Apparently, “Rock Star Suits” is a fairly new product offering by Hard Rock. A Rock Star Suite is a luxury suite within an existing Hard Rock Hotel. At present, this product exists at only 1 – yes, 1 – Hard Rock Hotel. That’s it. There is one Rock Star Suite. And Hard Rock owns the “Rock Star Suites” mark via a licensing deal.
After filing suit, Hard Rock sought a preliminary injunction. In pressing its case for an injunction, Hard Rock focused on the Rock Stars Suite product (because there is absolutely zero likelihood of confusion between the top level Hard Rock Hotels vs. RockStar Hotels). But even that argument failed. In June 2018, the court denied Hard Rock’s request, holding that Hard Rock did not have a likelihood of success on the merits (shocking!). Some highlights from the Court’s order:
- Sophisticated consumers of complex goods or services are less likely to be confused than casual purchasers of small items. Upshot: Rich people buying expensive hotel rooms probably are not confusing Hard Rock Hotels and RockStar Hotels.
- There are hundreds of companies, products and services that use the phrase “Rock Star”. There are 60 companies registered to do business in California alone that use the phrase “Rock Star” in their names. Upshot: Third-party use of the contested phrase within and outside of the Plaintiff’s industry diminishes the strength of the mark.
- The trade dress for the respective Hard Rock branded products and the RockStar Hotels branded products are totally different.
- Overwhelming visual dissimilarity can defat an infringement claim, even where the other six factors all weigh in favor of the plaintiff. Boom. Mic drop.
- Hard Rock had absolutely zero evidence of actual consumer confusion.
- When RockStar Hotels sought a trademark, the examining attorney from the USPTO refused the mark, ruling that it created a likelihood of confusion with Hard Rock Hotels. In a trademark case, federal courts are not bound by the (terrible) decisions of a USPTO examining attorney. The Court gave the examining attorney’s decision no weight.
After losing its bid for an injunction, Hard Rock apparently came to its senses and quickly moved to dismiss the case without prejudice. But the Court wasn’t having any of it. On July 16, 2018, the Court issued an order granting Hard Rock’s motion for voluntary dismissal without prejudice contingent upon Hard Rock’s acceptance of certain conditions. The condition: Hard Rock has to pay some of RockStar’s fees and costs, in an amount to be determined by the Court. Based on evidence submitted by RockStar, they have spent more than $460,000 in attorneys’ fees and costs in defending the litigation. The Court has given Hard Rock until July 19th to either accept its condition or move forward with the litigation.
The takeaways:
- If this order is any indication, Judge Bloom is fantastic. I love it when bullies like Hard Rock push frivolous or near frivolous unfair competition cases and get called out for their misconduct. I hope Hard Rock gets whacked for at least $300,000 in fees/costs. It’s a nice slap on the wrist, but not nearly a big enough fine to deter this sort of litigation (which I view as being undertaken in bad faith).
- I said it right from the jump: Hard Rock’s lawyers would bill $500,000 before losing spectacularly. We don’t know what Hard Rock paid its lawyers, but we do know that Rock Star’s fees and costs were nearly $500,000. My guess is that Hard Rock paid even more. As you can probably tell, I’ve seen this movie before.
- The American system of brand protection was intended to prevent unfair competition. Unfortunately, due to incompetent government lawyers like this one at the USPTO, big law firms, the corporate power structure, and rampant judicial activism, big corporate interests have used that system to prevent fair competition. But perhaps the tide is turning.
The case is Hard Rock Cafe International USA Inc. et al v. RockStar Hotels Inc., Case No. 17-cv-62013, United States District Court for the Southern District of Florida.
Jonathan Pollard is a competition lawyer based in Fort Lauderdale, Florida. Pollard has appeared on or in the New York Times, Wall Street Journal, Bloomberg, FundFire, Digital Guardian, Law360, Litigation Commentary & Review, Inc. Magazine, PBS News Hour and more. He is the principal of Pollard PLLC. His office can be reached at 954-332-2380.
