We All Scream For Ice Cream: Master Softee Defaults in Trademark Dispute

For some of us who “summered” on the sweltering streets of New York City as children, the sound of the Mister Softee jingle triggers a Pavlovian response for that sweet, soft-serve ice cream.  It was the perfect antidote for those hot, humid summer days. Reviewing Mister Softee, Inc. v. Tsirkos, No. 14 CV 1975 (E.D.N.Y. Nov. 23, 2015), allowed me a few moments to reminisce about those days.

The case itself is not extraordinary. According to court papers filed by Mister Softee, Dimitrios Tsirkos had been a Mister Softee licensee for a number of years. Mister Softee alleged that at some point, Tsirkos began to violate the agreements that he entered by failing to make royalty payments and by failing to park his truck in approved depots.  Mister Softee sent Tsirkos a Notice of Default and Termination, but Tsirkos continued to use the Mister Softee marks, as well as confusingly similar marks such as MASTER SOFTEE and SOFT KING.  He also continued to sell ice cream in his prior Mister Softee territory, another violation of his agreements.

Mister Softee sought a preliminary injunction and received it.  Undeterred, Tsirkos violated the injunction, and the Court found Tsirkos to be in contempt of the preliminary injunction order on two occasions.  Thereafter, Tsirkos’s attorney moved to withdraw for non-payment of fees, and Tsirkos himself stopped showing up in court altogether. Mister Softee moved for a default judgment, seeking to make the preliminary injunction permanent and to obtain damages.  It also asked for attorneys’ fees.

District Judge Swain granted Mister Softee’s motion, finding that the elements for a default judgment were met.  In the Second Circuit, a court must weigh the following factors in deciding whether to grant a default judgment: (1) whether the default is willful; (2) whether there is a meritorious defense to the plaintiff’s claims; and (3) the level of prejudice the non-defaulting party would suffer as a result of a denial of the motion.

Here, the Court found that all three factors supported a default judgment. A finding of willfulness was supported by Tsirkos’ violation of the preliminary injunction order and two contempt orders. The Court also could find no meritorious defense pled in the Answer that Tsirkos had filed, only summary denials. As to the third factor, the Court noted that it may presume prejudice to the non-defaulting party by virtue of the defaulting party’s failure to defend or prosecute, and that in this case there was evidence of prejudice because of the efforts that Mister Softee had already expended in getting the prior orders.

The Court granted the default judgment, dismissed the counterclaims, converted the preliminary injunction to a permanent injunction, and granted judgment in the amount of $340,028.82 (which includes prejudgment interest), post-judgment interest, and attorneys’ fees.  That adds up to a whole lot of ice cream.  Expect Mister Softee to have Tsirkos’s assets frozen.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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