NEIL A. SMITH (63777)

LIMBACH & LIMBACH L.L.P.

2001 Ferry Building

San Francisco, California 94111

Telephone: (415) 433-4150

Of Counsel:

DAVID R. FRANCESCANI

MARYANN HAYES

DARBY & DARBY P.C.

805 Third Avenue

New York, New York 10022

Telephone: (212) 527-7700

Attorneys for Plaintiff

PLAYBOY ENTERPRISES, INC.

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

PLAYBOY ENTERPRISES, INC.,

Plaintiff,

v.

CALVIN DESIGNER LABEL, CALVIN FULLER, and CALVIN MERIT,

Defendants.

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Civil Action No. 97-3204 CAL

FIRST AMENDED COMPLAINT AND JURY DEMAND

For its Complaint against Defendants, Plaintiff Playboy Enterprises, Inc., by its attorneys, alleges as follows:

THE PARTIES

  1. Plaintiff Playboy Enterprises, Inc. ("PEI"), is a Delaware corporation having offices at 730 Fifth Avenue, New York, New York, and a principal place of business in Chicago, Illinois.
  2. Upon information and belief, Defendant Calvin Fuller is a citizen of the State of California residing at 345 California Drive, #38, Burlingame, California.
  3. Upon information and belief, Defendant Calvin Merit is a citizen of the State of California residing at 345 California Drive, #38, Burlingame, California.
  4. Upon information and belief, Defendant Calvin Designer Label is a California corporation or other business entity with its principal place of business at 340 Lorton Avenue, Burlingame, California or 345 California Drive #38, Burlingame, California.
  5. Upon information and belief, Calvin Fuller and Calvin Merit substantially own, control and operate and/or do business as Defendant Calvin Designer Label in that its acts are also the acts of the individual Defendants Fuller and Merit.

JURISDICTION AND VENUE

6. This is a civil action for trademark infringement, false designation of origin, unfair competition and dilution arising under the Trademark Act of 1946, as amended, 15 U.S.C. §§ 1051-1127 and the common law of the State of California.

7. (a) This Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1331, 28 U.S.C. § 1332, 28 U.S.C. § 1338 and the principles of supplemental jurisdiction pursuant to 28 U.S.C. § 1367. The amount in controversy, exclusive of interest and costs, exceeds $50,000.00. The parties are citizens of different states. Venue is proper pursuant to 28 U.S.C. § 1391(b) and (c).

LOCAL COURT VENUE

(b) Venue in the San Francisco Division is appropriate under the Local Rules of this Court, since the acts complained of here have taken place, at least in part, in the county of San Mateo, California.

FACTS COMMON TO ALL COUNTS

Playboy Magazine and the PLAYMATE trademarks

8. Continuously since long prior to the acts of Defendants alleged herein, PEI has published and continues to publish the well-known men's entertainment magazine Playboy, featuring photographs of beautiful women, celebrity interviews and articles of general interest.

9. Playboy magazine is published and distributed in interstate commerce, including the State of California, by PEI. Playboy magazine is also distributed throughout the world and is published in 16 international editions.

10. PEI also owns and utilizes the trademark PLAYMATE in connection with Playboy magazine and a wide variety of goods sold by PEI and/or its licensees, and owns and utilizes the registered trademark and trade name PLAYBOY for its magazine and other products and services, including PLAYBOY CYBER CLUB and Internet member subscription publication.

11. PEI is the owner of the federally registered trademark PLAYMATE, Registration No. 721,987. (See Ex. A), and several federal registrations for the PLAYBOY trademark, including trademark registrations nos. 2,020,389 and 2,011,646 for the marks PLAYBOY and HTTP.//WWW.PLAYBOY,COM for computer services including providing on-line magazines, and Registration No. 600,018 for the mark PLAYBOY for magazines (See Exhibit A).

12. The trademark PLAYMATE has been registered with the United States Patent and Trademark Office for a wide variety of goods (See, e.g., Ex. B).

13. Building upon the wide recognition and goodwill arising from its use of its PLAYMATE and PLAYBOY trademarks, PEI has sold or distributed, itself and through its licensees, a broad line of products under the trademarks PLAYMATE and PLAYBOY.

14. The PLAYMATE and PLAYBOY trademarks have acquired such goodwill and secondary meaning that the public has come to associate the PLAYMATE and PLAYBOY trademarks exclusively with PEI.

15. PEI owns a site on the Internet on the World Wide Web using the PLAYBOY trademark. PEI's Web site prominently features the PEI trademarks PLAYBOY and PLAYMATE, as well as photographs, articles of interest, PEI merchandise, videos and subscription information for Playboy Magazine.

The Internet

16. On information and belief, the Internet is an international computer "super-network" of over 15,000 computer networks which is used by 30 million or more individuals, corporations, organizations and educational institutions worldwide.

17. Users of the Internet can access each other's computers, can communicate directly with each other (by means of electronic mail or "e-mail"), and can access various types of data and information.

18. All computers connected to the Internet have a unique numerical address. Resources such as Web pages and other documents are located by a Uniform Resource Locator ("URL"). A URL incorporates a scheme followed by a numerical address and an option path to the desired resource. (For example, http://204.31.135.2/welcome.html where http is the scheme, 204.31.135.2 is the numerical address and welcome.html is the path to the resource.). The scheme defines the kind of resource and the mode of access. Http indicates a Web page. The path is typically a file name which often includes one or more directories.

19. To promote access to their Internet resources, many entities adopt "domain names." Domain names substitute easy to remember words for the numerical addresses. In the example given above, darbylaw.com could replace 204.31.135.2.

20. Domain names serve as an address for sending and receiving e-mail and for posting information or providing other services. On the Internet, a domain name serves as the primary identifier of the source of information, products or services.

21. It is common practice for companies to form Internet domain names by combining their trade name or one of their famous trademarks as a prefix and their business category as a suffix. The suffix ".com" (usually pronounced "dot com") identifies a service provider as commercial in nature.

22. For example, the General Electric Company has established and operates an on-line service under the Internet address "ge.com" for various corporate commercial purposes. Likewise, the IBM Corporation has established and operates an on-line service under the Internet address "ibm.com" for various corporate commercial purposes.

23. In order to preserve the necessary uniqueness of the domain name system, entities are required to register their domain names with the company Network Solutions, Inc. ("NSI"). The application process for an Internet on-line computer address is effected upon written request to the Internic, an organization run by Network Solutions, Inc. ("NSI"), of Herndon, Virginia, that provides support services, including domain name registration, for the Internet.

24. Domain names may be registered upon payment of a $100 fee and the completion of an on-line template called the "NSI Registration Agreement". NSI has a template procedure for withdrawal of domain name registrations.

25. Pursuant to the NSI Registration Agreement, a registrant must designate persons to serve as administrative, technical, and billing contacts.

26. Upon belief, Defendants Calvin Fuller and/or Calvin Merit are the administrative, technical and billing contacts for the domain names and Web pages herein dispute. (See Ex. C, which are queries regarding identification of contacts for the domain names or URL for such Defendants).

Defendants' Unlawful Acts and Conduct

27. Defendants have registered the domain names "playboyxxx.com" and "playmatelive.com" with NSI. (See Ex. C). Exhibit D includes printouts of the first and other Internet web pages of Defendants' web sites, showing the use by Defendants of the PLAYMATE and PLAYBOY trademarks. When viewed on the computer screen, the PLAYBOY trademarks and trade names on the playmatelive.com Web page (the second word in the second line from the bottom on the playmatelive.com Web page) and on the playboyxxx.com Web site (repeatedly used over several pages in small print as "PLAYBOY" and "PLAYBOY MAGAZINE") the trademarks are not visible on the computer screen, but are hidden in a black background which overlays the words shown on the printout. Both versions (screen view and printout made to show hidden code words) are included in Exhibit D. The PLAYBOY and PLAYMATE trademarks used in this way both serve to attract those users of the Internet searching for "PLAYBOY", "PLAYBOY MAGAZINE" or "PLAYMATE" using PEI's trademarks. As Exhibit D shows, PEI's PLAYMATE and PLAYBOY trademarks are prominently featured in Defendants' Web site located at www.playmatelive.com and playboyxxx.com.

28. Defendants provide adult material and nude photographs on the Web pages located at www.playboyxxx.com and www.playmatelive.com.

29. Defendants are using PEI's registered trademarks PLAYMATE and PLAYBOY within its domain names playboyxxx.com and playmatelive.com, and as part of the Web pages offered under the Internet addresses at www.playboyxxx.com and www.playmatelive.com.

30. Defendants have purposefully promoted and continue to promote their Web sites and adult photo collections in such a way as to create a false association between Defendants and PEI.

31. On their Web pages at playmatelive.com Defendants offer free listings in a publication named "Playmate Live Magazine," which, according to Defendants' message: "PlayMate Live Magazine is exposed to over 25,000,000 million potential new customers...." (See Exhibit D.) PEI is not affiliated with nor does it in any way sponsor "Playmate Live Magazine." On their Website at playboyxxx.com Defendants repeatedly use the PLAYBOY and PLAYMATE trademarks such as by the phrase "Get it all here @ PLAYBOY"; "PLAYMATE LIVE STRIPSHOW." PEI is not affiliated with nor does it in any way sponsor such programs.

32. Upon information and belief, Defendants undertake their infringing activities for profit, as a business venture.

33. Defendants are not now and have never been authorized by PEI, and are not now and have never been entitled to use the PEI's trademarks PLAYMATE or PLAYBOY in connection with any business or service.

34. Defendants' use of the PLAYMATE and PLAYBOY trademarks in conjunction with the rendering of their Internet services is likely to cause confusion, mistake or deception. In particular, consumers are likely to believe that Defendants' services are authorized, sponsored or otherwise approved by PEI when in fact they are not. Such confusion is likely to occur within the State of California and within this judicial district.

35. PEI has been and continues to be injured by Defendants' unlawful acts within the State of California and within this judicial district.

36. PEI has made demands that Defendants discontinue and cease the infringement and acts complained of, but Defendants have ignored Plaintiff's requests. (See Exhibit E.) Upon information and belief, Defendants have performed the acts complained of herein willfully and with knowledge of the infringement that they would cause, and with intent to cause, confusion, mistake or deception, and to appropriate and unfairly trade upon PEI's goodwill in the PLAYMATE and PLAYBOY trademarks.

COUNT I

FEDERAL TRADEMARK INFRINGEMENT

37. PEI repeats and realleges each of the allegations contained in paragraphs 1 through 36 as if fully set forth herein.

38. The aforesaid acts of Defendants constitute infringement of PEI's registered PLAYMATE and PLAYBOY trademarks, in violation of section 32(1) of the Trademark Act of 1946, as amended, 15 U.S.C. § 1114(1).

39. Upon information and belief, the aforesaid acts were undertaken willfully and with the intention of causing confusion, mistake or deception.

40. By reason of the acts of Defendants alleged herein, PEI has suffered, is suffering and will continue to suffer irreparable damage and, unless said Defendants are restrained from continuing its wrongful acts, the damage to PEI will increase.

41. PEI has no adequate remedy at law.

COUNT II

FALSE DESIGNATION OF ORIGIN AND

UNFAIR COMPETITION UNDER SECTION 43(a)

OF THE LANHAM ACT

42. PEI repeats and realleges each of the allegations contained in paragraphs 1 through 41 as if fully set forth herein.

43. The aforesaid acts of Defendants are likely to cause confusion, mistake or deception among purchasers and potential purchasers of products bearing the PLAYMATE and PLAYBOY trademarks as to the source or origin of the services rendered and goods sold by Defendants by reason of the fact that purchasers are likely to believe that Defendants' goods and services originate from, or are in some way properly connected with, approved by, sponsored by, or endorsed by PEI.

44. The confusion, mistake or deception referred to herein arises out of the aforesaid acts of Defendants which constitute false designation of origin and unfair competition in violation of section 43(a) of the Trademark Act of 1946, as amended, 15 U.S.C. § 1125(a).

45. Upon information and belief the aforesaid acts were undertaken willfully and with the intention of causing confusion, mistake or deception.

46. By reason of the acts of Defendants alleged herein, PEI has suffered, is suffering and will continue to suffer irreparable damage and, unless said Defendants are restrained from continuing these wrongful acts, the damage to PEI will increase.

47. PEI has no adequate remedy at law.

COUNT III

DILUTION UNDER SECTION 43(c)

OF THE LANHAM ACT

48. PEI repeats and realleges each of the allegations contained in paragraphs 1 through 47 as if fully set forth herein.

49. Defendants' unauthorized use of PEI's famous PLAYMATE and PLAYBOY trademarks will tend to and does dilute the distinctive quality of said marks and will diminish and destroy the public association of said marks with PEI in violation of 15 U.S.C. § 1125(c).

50. By reason of the acts of Defendants alleged herein, PEI has suffered, is suffering and will continue to suffer irreparable damage and, unless said Defendants are restrained from continuing its wrongful acts, the damage will be increased.

51. PEI has no adequate remedy at law.

COUNT IV

COMMON AND STATUTORY LAW TRADEMARK, TRADE NAME

INFRINGEMENT, UNFAIR COMPETITION AND DILUTION

52. PEI repeats and realleges each of the allegations contained in paragraphs 1 through 51 as if fully set forth herein.

53. By their acts alleged herein, Defendants have engaged in trademark infringement, trade name infringement, and unfair competition under the common and statutory law of the State of California, California Business and Professions Code § 14330, et seq.; and § 14402, et seq. and § 17200, et seq.

54. Defendants have intentionally deceived the public by misrepresenting their services are in some way sponsored or authorized by PEI.

55. Upon information and belief the aforesaid acts were undertaken willfully and with the intention of causing confusion, mistake or deception.

56. By reason of the acts of Defendants alleged herein, PEI has suffered, is suffering and will continue to suffer irreparable damage and, unless said Defendants are restrained from continuing its wrongful acts, the damage will be increased.

57. PEI has no adequate remedy at law.

WHEREFORE, PEI demands that:

1. Defendants, their officers, agents, servants, employees, attorneys, parents, subsidiaries and related companies and all persons acting for, with, by, through or under them, and their Internet service providers with notice of the Court's Order by personal service, electronic mail, or otherwise, and each of them, be temporarily, preliminarily and thereafter permanently enjoined and restrained from:

(a) using in any manner the PLAYMATE or PLAYBOY trademarks, and any other term or terms likely to cause confusion therewith as Defendants' domain name, directory, or other such computer address, as the name of their Web site service, in buried code words or metatags, on their home page, on computer diskettes or in connection with the retrieval of data or information or on other goods or services, or in connection with the advertising or promotion of their goods, services, or Web site or services, so long as such goods or services do not emanate from or originate with PEI;

(b) using in any manner the PLAYMATE or PLAYBOY trademarks in connection with the Defendants' goods or services in such a manner that is likely to create the erroneous belief that said goods or services are authorized by, sponsored by, licensed by or are in some way associated with PEI;

(c) disseminating, using or distributing any Web site pages, advertising or Internet code words or titles, or any other promotional materials whose appearance so resembles PEI's intellectual property as to create a likelihood of confusion, mistake or deception;

(d) otherwise engaging in any other acts or conduct which would cause consumers to erroneously believe that Defendants' goods or services are somehow sponsored by, authorized by, licensed by, or in any other way associated with PEI; and

(e) copying, reproducing, distributing, or preparing derivative works of PEI's copyrighted photographs;

2. Defendants, their officers, agents, servants, employees, attorneys, parents, subsidiaries and related companies and all persons acting for, with, by, through or under them, and their Internet service providers with notice of the Court's Order by personal service, electronic mail, or otherwise, and each of them, be temporarily, preliminarily and thereafter permanently enjoined and be restrained from diluting the distinctive quality of the PLAYMATE trademark.

3. Defendants be directed to delete from their computer files, menus, hard drives, servers, diskettes and backups, "playboyxxx.com" and "playmatelive.com", any copy, simulation, variation or colorable imitations thereof, and any use of PLAYMATE or PLAYBOY.

4. Defendants be required to deliver up to PEI to be held for destruction at the conclusion of this action any and all computer software, inventory of computer diskettes or the like, packaging, labels, sales material, press releases, promotional material, advertising material, stationary, plates, and other materials bearing the name "playboy" and "playmate," or any copy, simulation, variation or colorable imitation of the PLAYMATE or PLAYBOY trademarks.

5. Defendants immediately cease using and claiming any ownership of the marks "PLAYBOY" or "PLAYMATE" on the Internet and that, within 24 hours of entry of an Order of the Court, complete sections 0 through 2 of the Network Solutions, Inc. (NSI) domain name template found at ftp://rs.internic.net/templates/domain-template.txt. and/or take whatever steps and acts as may be necessary for the purpose of deleting the domain names playmatelive.com and playboyxxx.com from NSI's registry.

6. Within 24 hours of entry of an Order of the Court, Defendants give written notice to Internic and/or NSI that they forfeit any registrations, claims or other interests allowing Defendants to use or claim rights to use the word "playboy" or "playmate" within any URL, other address, and to delete such references used in any manner in visible or hidden code or text or introductory web site material.

7. That if and/or when Internic/NSI delegates jurisdiction of the domain names "playmatelive.com" and "playboyxxx.com" to this Court, it be ordered that the domain names be cancelled.

8. That Defendants be ordered to notify in writing and direct to all publishers of directories or lists, including internet search engines, in which Defendants' use of playboyxxx.com or "playmatelive.com" or PLAYBOY name appears, to delete all references to these names from their public databases, search engine directories, directory assistance and from all future directories in which said name is to appear, and to delete al forwarding or "cache memory" or storage mechanisms referencing such name, and that Defendants shall notify their customers, subscribers and correspondents who have done business or communicated with them, during the period that they have used the name PLAYMATELIVE, PLAYBOY or PLAYBOY MAGAZINE on their Internet Web site or used "playboyxx.com" or "playmatelive.com" as their domain names, of their name change or that they no longer do business under this name.

9. That Defendants shall immediately notify in writing and direct all publications in which any advertisements or other references to Defendants' business under the above names or domain names are scheduled to appear to cancel all advertisements and references using the names and domain names.

10. Defendants file with the Court and serve upon PEI's counsel within thirty (30) days after entry of Judgment a report in writing under oath setting forth in detail the manner and form in which Defendants have complied with the requirements of the Injunction and Order.

11. Defendants be required to account for and pay over to PEI all damages sustained by PEI, the amount of which cannot be calculated at this time, but is believed to be in excess of five million dollars ($5,000,000.00).

12. Defendants be required to pay statutory damages in an amount to be determined for their use of a counterfeit of PEI's registered trademark under 15 U.S.C. § 1117(c).

13. Defendants be required to account for and pay over to PEI all profits realized by Defendants by reason of their unlawful acts alleged herein, and that such amounts be trebled, as provided by law.

14. Defendants be required to pay PEI punitive damages as may be permitted by law or in the discretion of the Court.

15. Defendants be required to post any Order of the Court on their Web sites and give notice thereof to all their correspondents, members and subscribers.

16. PEI have such other and further relief as the Court may deem appropriate to prevent the public from deriving the erroneous impression that any goods or services provided by or promoted by Defendants are authorized by PEI or related in any way to PEI, its products or services.

JURY DEMAND

Plaintiff requests trial by jury on all issues so triable.

PLAYBOY ENTERPRISES, INC.

Dated: September 29, 1997 By: ___________________________

Neil A. Smith

LIMBACH & LIMBACH L.L.P.

2001 Ferry Building

San Francisco, CA 94111

(415) 433-4150

Attorneys for Plaintiff,

PLAYBOY ENTERPRISES, INC.

OF COUNSEL:

David R. Francescani

Maryann Hayes

DARBY & DARBY P.C.

805 Third Avenue

New York, NY 10022

(212) 527-7700