FRHUEB, Inc v. Sabino De Freitas Abdala

Background

FRHUEB, Inc. and Defendants Thiago Sabino de Freitas Abdala and Priscila Patto filed cross-motions for summary judgment. Defendants sought judgment on all ten causes of action in FRHUEB’s Complaint. Those claims included four claims under the Lanham Act involving trademark infringement, false designation of origin or false description, false advertising, and trademark dilution, along with New York-law claims involving business reputation, deceptive business practices, unfair competition, misappropriation, unjust enrichment, and fiduciary duties.

FRHUEB sought summary judgment on all ten of Defendants’ counterclaims. Those counterclaims alleged fraudulent misrepresentation, fraudulent inducement, breach of contract, unjust enrichment, breach of fiduciary duty, several Lanham Act violations, unfair competition and passing off, violation of the right of publicity, and violation of New York General Business Law § 349.

Magistrate Judge Parker recommended granting Defendants’ motion on all claims in the Complaint and granting FRHUEB’s motion on Counterclaims 1 through 8 and 10. The recommendation would deny FRHUEB’s motion on Counterclaim 9, which alleged a violation of New York’s right-of-publicity law. Defendants objected only to the recommendation concerning Counterclaims 6 and 7, which alleged Lanham Act false-designation, false-endorsement, false-association, false-description, and false-advertising violations.

Court’s analysis

The court reviewed the portions of the recommendation challenged by Defendants without deference, meaning it independently considered the record, law, objections, and responses. It reviewed the unchallenged portions for clear error and found none.

The court rejected Defendants’ argument that FRHUEB’s summary-judgment motion should be dismissed because it did not comply with Southern District of New York Local Rule 7.1(a). Although FRHUEB’s motion lacked a formal notice of motion, it included a legal memorandum and supporting documents that adequately informed Defendants of the arguments. The court found no meaningful prejudice.

For Counterclaims 6 and 7, the court applied the requirement that a Lanham Act plaintiff show injury to a commercial interest in reputation or sales that was proximately caused by the alleged violation. The court agreed with Magistrate Judge Parker that Defendants had not met this standing requirement. The opinion states that Defendants had never advertised or sold jewelry under the “Hueb” brand and had provided no evidence of current or future plans to do so. The court also found that attorneys’ conclusory statements were insufficient to create a genuine dispute of material fact.

The court further rejected Defendants’ argument that an injunction entered in the case created evidence of commercial injury. It noted that Defendants had consented by stipulation to each version of the injunction and stated that a court order in the litigation could not create a genuine factual dispute where the record lacked evidence of commercial injury.

Ruling

Judge Garnett adopted Magistrate Judge Parker’s June 28, 2024 Report and Recommendation in its entirety. Defendants’ motion for summary judgment was granted in its entirety. FRHUEB’s motion for summary judgment was granted in part and denied in part. FRHUEB’s Complaint was dismissed with prejudice, and Defendants’ Counterclaims 1 through 8 and 10 were dismissed with prejudice. Counterclaim 9, concerning the right of publicity under New York law, remained pending, and the parties were ordered to submit a joint letter proposing next steps within 14 days unless the case had already been settled or otherwise terminated.