IP Law Daily, TRADEMARK—D.N.J.: Democratic Party of NJ afforded fourth opportunity to plead infringement claims, (Jun 9, 2023)

By Anne H. Gibson, J.D., LL.M.

Claims regarding NEW JERSEY DEMOCRATIC PARTY mark survive; political organization given another shot at pleading adequate facts as to claims regarding NJDEMS mark.

The New Jersey Democratic Party must revise its pleadings a fourth time in its case against two New Jersey residents accused of impersonating it on mailers and a website, the federal district court in Newark, New Jersey has held. A motion to dismiss filed by James Devine and Lisa McCormick, owners of the website “NJDEMS.COM” and the nonprofit “New Jersey Democratic Party A NJ Nonprofit Corporation,” was granted in part and denied in part. Although the Democratic Party of NJ was successful in adequately pleading its unfair competition claims regarding its mark NEW JERSEY DEMOCRATIC PARTY, it did not provide sufficient facts to show that its NJDEMS mark had acquired secondary meaning, a necessary element of several claims. The dismissals were granted without prejudice, so that a fourth amended complaint could be filed (Democratic Party Of NJ, Inc. v. Devine, June 7, 2023, Vazquez, J.).

The Democratic Party of NJ, also known as the New Jersey Democratic Party, is the sole statewide committee authorized to represent the Democratic Party in New Jersey under state law. It operates a website, NJDEMS.org. As part of its normal operations, the political organization endorses candidates and sends out mailers, as well as provides information on its website. In October 2021, Devine and McCormick, who are domestic partners, operated their website and sent out mailers endorsing school board candidates that read “Paid for by NJDEMS.COM” and “New Jersey Democratic Party” at the bottom. The candidates on the mailers were not endorsed by the Democratic Party of NJ.

The political organization then filed suit again Devine and McCormick, who responded with a motion to dismiss. In October, the court issued an opinion denying in part and granting in par the motion, and the New Jersey Democratic Party was given leave to amend. In its third amended complaint, the organization alleged (1) a violation of the Anticybersquatting Consumer Protection Act (ACPA), (2) unfair competition under the Lanham Act, New Jersey statutory law, and New Jersey common law, and (3) violation of New Jersey’s corporate name statute. Devine and McCormick again filed a motion to dismiss.

Unfair Competition. The court first turned to the political organization’s unfair competition claims. In order to state a claim under the Lanham Act, the court stated, the plaintiff must allege sufficient facts to support the following four points: “(1) the mark at issue is valid and legally protectable; (2) the mark is owned by the plaintiff; (3) the defendant used the mark in commerce or in connection with any goods or services or container for goods; and (4) this ‘use’ was in a manner likely to create confusion concerning the origin of the goods or services.” The court referred to its earlier decision, which it incorporated by reference, in which it had determined that the New Jersey Democratic Party had adequately pleaded the third and fourth factors, that Devine and McCormick’s use of the marks was likely to cause confusion. However, because the marks are not registered, the organization must prove that they have taken on secondary meaning in order to prove the first and second factors.

Secondary meaning is present when the consuming public associates the mark not just with the relevant services, but with the underlying organization itself. “In determining whether a political organization’s name and insignia acquired secondary meaning, the inquiry is whether the relevant consuming class—meaning the persons in the relevant geographic area who are interested in that party and its activities—associates the name and insignia of that party with the political organization,” the court stated. It found that the political organization had pleaded adequate facts to support this in relation to the mark NEW JERSEY DEMOCRATIC PARTY, including that it had used that mark continuously since 1984 and that third-parties, both in the media and online, also used that name for the organization. The court thus denied the individuals’ motion to dismiss as to the unfair competition claims related to NEW JERSEY DEMOCRATIC PARTY.

However, the court found that the political organization still had not pleaded adequate facts to support a secondary meaning for NJDEMS. Although it argued that it had used the website NJDEMS.org since 1996, and that it uses NJDEMS in its mailers and online publications, the court found this was not enough to show that NJDEMS had acquired secondary meaning by March 20, 2009, the date that Devine and McCormick registered NJDEMS.com. “[W]ithout more pertaining to the scope and volume of Plaintiff’s use of ‘NJDEMS’ prior to Defendants’ use, the Court cannot reasonably infer secondary meaning in the minds of the consuming public.” The unfair competition claims as to NJDEMS were thus dismissed without prejudice. Because the elements of the state statutory and common law claims are the same as under the Lanham Act, these too failed as to NJDEMS.

Cybersquatting. Cybersquatting under ACPA occurs when someone registers, in bad faith, an internet domain name that is so similar to an existing mark that it causes confusion. The court stated that a plaintiff must allege that: (1) its mark was distinctive or famous and entitled to protection at the time the domain name was registered; (2) the defendant’s domain name is “identical or confusingly similar to” the plaintiff’s mark; and (3) the defendant registered the domain name with the bad faith intent to profit from the mark. Again referencing its earlier decision, the court stated that it found that the New Jersey Democratic Party adequately pleaded the second and third elements, that NJDEMS.com was effectively identical to NJDEMS.org and that Devine and McCormick had registered the name in bad faith. However, as in the case of its unfair competition claims, the political organization’s allegations failed to support a finding that NJDEMS had acquired a secondary meaning as of March 20, 2009, as required for the first element. This claim was thus also dismissed without prejudice.

Corporate name statute. New Jersey law makes it a violation for a nonprofit’s name to be “the same as, or confusingly similar to, the corporate name of any domestic corporation.” In its prior decision, the court found that the Democratic Party of NJ had stated sufficient facts to allege that the name “New Jersey Democratic Party A NJ Nonprofit Corporation” was confusingly similar to its own name. For the same reasons, the court again denied the motion to dismiss this claim.

The motion to dismiss was thus denied as to the unfair competition claims regarding NEW JERSEY DEMOCRATIC PARTY, and as to the violation of the corporate name statute. The unfair competition claims as to NJDEMS, as well as the cybersquatting claim, were dismissed without prejudice, allowing the political organization to file an amended complaint within 30 days.

The Case is No. 2:22-cv-01268-JMV-AME.

Attorneys: Matthew I.W. Baker (Genova Burns LLC) for Democratic Party of NJ, Inc. Desha Jackson (Desha Jackson Law Group, LLC) for James Devine.

Companies: Democratic Party of NJ, Inc.

Cases: Trademark NewJerseyNews