Solid 21, Inc. v. Richemont North America, Inc.

Background

Solid 21 alleged that it owned the “RED GOLD®” trademark for a special gold alloy used in fine jewelry, including watches. It claimed that the defendants used “Red Gold” in websites, boutique stores, and retailer advertisements for luxury watches. The claims included trademark infringement, contributory trademark infringement, unfair competition, trademark dilution, and false description under federal law; trademark claims under New York law; and deceptive acts and practices under New York General Business Law § 349.

The defendants were Richemont North America, Inc., Richemont International S.A., Montblanc-Simplo GmbH, and Officine Panerai A.G. The court considered the allegations in Solid 21’s Third Amended Complaint and its exhibits as true only for purposes of deciding the motion to dismiss. The defendants argued that the complaint failed to state legally sufficient claims, that a 2014 agreement limited Solid 21’s claims, and that the challenged uses were protected as fair use.

Ruling on the direct trademark claims

The court granted the motion to dismiss the direct trademark claims against Panerai AG because the complaint did not provide specific facts showing how Panerai AG used “Red Gold” to sell, market, or advertise watches. The court found that the allegations against Panerai AG were merely conclusory.

The court otherwise denied the motion to dismiss the direct trademark claims against Richemont International, Richemont NA, and Montblanc-Simplo. The complaint identified particular watches, advertisements, websites, and alleged uses for those defendants, which was enough at the pleading stage.

The court interpreted the 2014 agreement under New York law. The agreement defined “Richemont” as Richemont NA and Compagnie Financiere Richemont, S.A.; it did not include their affiliates or subsidiaries. As a result, the agreement barred claims against Richemont NA based on uses of “Red Gold” during the immunity period, but it did not bar the claims against Richemont International or Montblanc-Simplo. The court found that claims against Richemont NA could proceed for alleged uses before July 19, 2011, or after February 8, 2019. It also found that the complaint alleged a potentially actionable Richemont NA use from January 2011 involving a Baume & Mercier watch.

The court generally found the fair-use defense premature at the motion-to-dismiss stage. The complaint plausibly alleged that “Red Gold” appeared prominently in product headings, in a manner that could attract attention to the term as a brand and suggest an association with Solid 21. The court reached a different conclusion for the IWC advertisement in Exhibit 17: there, “red gold” appeared only in a product description, in ordinary prose, and below the main product heading. The court found that use descriptive and protected by fair use. Claims could therefore not proceed based on that advertisement.

Contributory trademark infringement

Contributory trademark infringement concerns allegedly assisting another party’s infringement. The court dismissed this claim as to Panerai AG and Montblanc-Simplo because most of the retailer advertisements showed only descriptive uses of “Red Gold,” so there was no actionable direct infringement to support a contributory claim.

The court denied the motion to dismiss the contributory-infringement claim against Richemont International and Richemont NA, but only as to Abt’s offer of sale in Exhibit 19. That listing placed “Red Gold” in the product heading in the same-sized type as the other terms and without modifiers such as “18-K,” making it plausibly a trademark use. The court found the other retailer advertisements clearly descriptive and therefore not actionable on the allegations presented.

New York General Business Law § 349

The court granted the motion to dismiss the claim under New York General Business Law § 349 against all defendants. Although the complaint alleged that the defendants’ references to “Red Gold” could mislead consumers, it did not allege a separate harm affecting the public health or public interest, as required for this type of consumer-deception claim based on trademark infringement.

Disposition

The motion to dismiss was granted in part and denied in part. Panerai AG was dismissed from the case. The contributory trademark-infringement claim could proceed only against Richemont International and Richemont NA, and only concerning Abt’s Exhibit 19 offer of sale. The § 349 claim was dismissed as to all defendants. The remaining claims survived against Richemont International, Richemont NA, and Montblanc-Simplo, subject to the limits on Richemont NA’s immunity-period conduct and the exclusion of the IWC advertisement in Exhibit 17. Judge Lorna G. Schofield directed the Clerk of Court to close Docket No. 68.