Rise and Fall of an Empire (Distribution, Inc.)

In the pilot episode of Fox’s smash-hit series Empire, Cookie Lyon, explaining why, after her release from jail, she’s returning to her husband Lucious Lyon’s fictional record label, Empire Entertainment, says simply: “I’m here to get what’s mine.”  This is, of course, in reference to the formerly-jailed matriarch having taken the rap for Lucious to the tune of 17 years behind bars for drug-running while he built his music “empire.” Coincidentally, it also may sum up the thinking over the last couple of months by real-life label, Empire Distribution, Inc. (“Empire Distribution”) which, in asserting that its alleged intellectual property rights have been improperly appropriated by the record-breaking show, appears to also be similarly attempting to “get what’s mine.”  But in doing so, it appears to have awoken another sleeping empire, Fox, and now faces an uncertain fate of its own.

According to the declaratory judgment complaint (the “Complaint”) filed by Twentieth Century Fox and its television subsidiaries (collectively, “Fox”) in the Central District of California last week (No. 15-cv-02158), on February 16th  of this year, three days after Empire broke viewership ratings records for its fifth consecutive week, Fox received a cease and desist letter from Empire Distribution alleging that Fox, by using the word “Empire” in conjunction with the title of the show and its fictional record label, coupled with the fact that the show’s fictional label was run by Lucious Lyon, a “homophobic drug dealer prone to murdering his friends,” was committing trademark infringement and diluting Empire Distribution’s brand through tarnishment.  In a follow-up telephone call with Fox, Empire Distribution demanded $8 million dollars to resolve its potential claims.  Fox executives must have rejected this initial settlement pitch out-of-hand, because on March 6th, Empire Distribution sent a second letter, not only reiterating its claims, but adding a claim for unfair competition as against Fox.  This time, according to the Complaint, Empire Distribution gave Fox three possible options — (a) pay $5 million dollars to the label and include the artists it represents as guest stars on Empire; (b) pay the full $8 million dollars previously demanded; or (c) stop using the word “Empire.”

Perhaps Empire Distribution should have paid heed to what Jamal Lyon once told his brother Hakeem, “You always coming to me for advice. I’m going to give you some. Don’t ever underestimate me, little brother.”  Empire Distribution clearly underestimated Fox here, sensing Fox may just pay the label off rather than duke it out in the legal system.  But rather than being bullied into paying the ransom, Fox chose option (d): “Ignore the patently-ridiculous claims in the attempt at a shakedown, and file a declaratory judgment action in federal court seeking the vindication of rights to continue use the word “Empire” in conjunction with the show.”  Besides seeking the Court’s agreement with its contention that it has not committed the claims it was accused of in the cease and desist letters, Fox also seeks a permanent injunction against Empire Distribution and its employees from “making false statements and representations to third parties asserting that Fox has violated its trademark rights, if any,” as well as attorney’s fees for having to file the action at all.

Well, does Empire Distribution have a case here?  Fox alleges that despite claiming rights to three separate marks, “Empire Distribution,” “Empire Recordings” and “Empire,” and even though Empire Distribution may have been using its name in commerce prior to the show’s conceptualization and premiere (they claim they started using “Empire” in conjunction with the record company back in 2010), that it’s not clear Empire Distribution will be able to prove any of its claims here.  To boot: (1) Empire Distribution has never applied for a federal trademark for “Empire”; and, more importantly, (2) the still-pending, renewed application for registration of the marks “Empire Distribution” and “Empire Recordings” was originally denied due to likelihood of confusion with other existing “Empire” marks.  Indeed, the Empire Distribution logo apparently does not even appear on the company’s album covers and Google searches performed on the filing date of the Complaint show that Empire Distribution’s webpage fails to provide a “hit” until the sixth page of a search for “empire record label.”  Adding insult to injury for Empire Distribution, the “hit” also turned up after “hits” for several other record labels containing “Empire” in their names, as well as pages related to, you guessed it, the 1995 movie Empire Records, as well.  Ouch.

So, Empire Distribution has no registrations for its word marks, none of its alleged marks are particularly distinctive, nor have they acquired any secondary meaning for Empire Distribution (see, e.g. the other record companies that use “Empire” in their name).  As such, there really is no argument that a likelihood of confusion could exist here either. What does the Insider expect to happen in this one?  Well, perhaps we should break it down like this — while the power struggle for Lucious Lyon’s fictional “empire” will continue for a record-breaking Season Two, it appears that Empire Distribution’s claims will not even last until the new season’s premiere.  Indeed, as Cookie Lyon also once said, “The streets ain’t made for everybody.  That’s why they made sidewalks.”  Empire Distribution tried to hit the streets and make the big time here.  In the end, unfortunately, it appears it won’t be long until its right back on the sidewalks where it came from.

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