CARMEN ELECTRA, TIFFANY TOTH, GEMMA LEE, JESSA HINTON, JESSE GOLDEN, LINA POSADA, SHEENA LEE WEBER, HEATHER RAE YOUNG, RACHEL KOREN, SABELLA SHAKE, URSULA MAYES, Plаintiffs-Appellants, v. 59 MURRAY ENTERPRISES, INC., DBA NEW YORK DOLLS GENTLEMEN‘S CLUB, JAY-JAY CABARET, INC., AAM HOLDING CORPORATION, DBA PRIVATE EYES GENTLEMEN‘S CLUB, Defendants-Appellees.
Docket No. 19-235
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
August Term, 2019 (Argued: January 8, 2020 Decided: February 9, 2021)
19-235-cv
Appellants also appeal from the district court‘s order concluding that Appellants had not accepted an offer of judgment pursuant to
Appellants further appeal from the district court‘s grant of summary judgment to Appellees as to their Lanham Act,
Affirmed in part, vacated in part, and remanded.
PETER T. SHAPIRO, Lewis Brisbois Bisgaard & Smith LLP, New York, NY, for Defendants-Appellees.
POOLER, Circuit Judge:
Plaintiffs-Appellants Carmen Electra, Tiffany Toth, Gemma Lee, Jessa Hinton, Jesse Golden, Lina Posada, Sheena Lee Weber, Heather Rae Young, Rachel Koren, Sabella Shake, and Ursula Mayes (collectively, “Appellants“) appeal from so much of a final judgment of the United States District Court for the Southern District of New York (Naomi R. Buchwald, J.) as dismissed their claims under
The district court held that Appellants’ signing of full releases of their rights to the photographs defeated their claims. We conclude that the terms of Shake and Hinton‘s release agreements are disputed material facts, and Appellees concede that neither they nor the third-party contractors that created and published the advertisements secured legal rights to use any of the photographs at issue. We hold that the district court erred in granting summary judgment to Appellees and in denying summary judgment to Appellants on liability. We thus vacate the judgment in part and remand for further proceedings.
We also hold that the district court correctly rejected Appellants’ purported acceptance of the offer of judgment pursuant to
BACKGROUND
I. Factual Background
Appellants are professional models, actresses, and businesswomen who commercially promote their image and likeness to various clients, brands, and media outlets, or have done so previously. Their images have appeared in a variety of magazines, advertising campaigns, and other publications. Several Appellants have appeared in film and television programs, and many of them have a large social media following.
59 Murray Enterprises, Inc., AAM Holding Corp., and Jay-Jay Cabaret, Inc. (collectively, “the Club Companies” or “Appellees“) individually own and operate various strip clubs in Nеw York City, including New York Dolls
Appellants attached the challenged advertisements to their second amended complaint (“SAC“), and a selection of the advertisements is appended to this opinion. The advertisements were varied in form, purpose, and content, but each combined a prurient photograph of one or more of the Appellants, the logo or name of one of the Clubs, and promotional text. For instance, a
Appellants were never asked to authorize the use of their images in the Clubs’ advertisements, and they never entered into release agreements with the Club Companies authorizing such use. They never received nor were offered
Each Appellant previously entered into agreements releasing their rights to photographs in which they appear as models, and the record includes release agreements relating to at least some of the photographs at issue in this litigation. As explained in further detail below, the district court correctly held that the one-year statute of limitations applicable in actions under
The advertisements using Lee‘s image used a photograph taken by J Squared Photography for Dreamgirl Lingerie (“Dreamgirl“). Lee signed a
The advertisement using Mayes‘s image also used a photograph originally shot for Dreamgirl. Mayes entered into a release for the photograph with
The advertisement using Koren‘s and Shake‘s images used a photograph taken for Fastdates.com in which they are both featured. Koren entered into a release for the photograph with Gianatsis Design Associates that “authorize[d] the use and reproduction, by Gianatsis Design Associates or Jim Gianatsis or anyone authorized by Gianatsis Design Associates, of any and all photographs” taken of her at the photoshoot for “any purpose whatsoever, without further compensation,” and provided that the photographs would be the property of Gianatsis Design Associates “solely and completely.” App‘x at 2204. The parties agree that Shake entered into a release for the image, but the content of that release agreement is not in the record.
Lastly, the advertisements featuring Golden‘s image used photographs originally shot for Leg Avenue. The parties agreed before the district court that Golden entered into a modeling contract with Leg Avenue that included a release agreement that applied to the photographs at issue. This release provides that Golden “irrevocably assign[s] to Leg Avenue, Inc. and its legal representatives, successors, agents, assigns, and all persons or corporations acting with its permission . . ., without restriction, without further compensation to [her], and for any purpose whatsoever, the unrestricted rights to copyright, use, publish, sell, or distribute” the photographs. App‘x at 1630.
The Club Companies used third-party contractors to create the advertisements and publish them on the Clubs’ websites and social media, including Paul Brown and his company, Internet Management Corporation (“IMC“), which designed the Clubs’ websites and provided advertising services
Though the photographs at issue were taken for a number of different companies, Brown averred that he thought that all the photographs IMC posted on the Clubs’ websites came from catalogs of images that Forplay would send to IMC each month. Even if the photographs did not originate from the Forplay catalog, however, Brown averred that the photographs would have come from another source that informed IMC that the photographs “could be freely used because all the rights to the photos had been conveyed.” Affidavit of Paul Brown at 3, Toth v. 59 Murray Enters., Inc., No. 15-cv-8028 (S.D.N.Y. 2019), ECF No. 108.
Brown averred that he believed he had a legal right to use each image and that he would never intentionally post an image without the legal right to do so. The same affidavit states that Brown told Lipsitz and Albert that he had releases from Forplay for the photographs that IMC used in the advertisements. Both Lipsitz and Albert declared that they believed IMC had a legal right to use the
Appellants’ tax returns show that their income either increased or remained approximately the same from 2009 to 2016. Appellees did not gain any additional profits from the use of the images, and there is no evidence of an increase in the Clubs’ revenue attributable to the special events promoted by some of the advertisements.
II. Procedural History
On October 15, 2015, Appellants filed a complaint alleging, inter alia, that Appellees’ use of the photographs in advertisements without written consent
On June 15, 2017, Appellees served a ”
Pursuant to
Rule 68 of the Federal Rules of Civil Procedure , Defendants hereby offer to Plaintiffs collectively to take a judgment against Defendants in the amount of $82,500.00, inclusive of interest,costs and attorneys’ fees, and without any admission of liability, on each of the Causes of Action contained in the Complaint, based upon facts existing as of the date of acceptance of the offer. . . . If Plaintiffs do not accept this offer, in writing, within 14 days after service of this offer upon him, this offer will be deemed rejected.
App‘x at 24-25. On June 27, 2017, Appellants returned to Appellees a document entitled “Plaintiffs’ Acceptance of Defendants’
PLEASE TAKE NOTICE that, pursuant to
Rule 68 of the Federal Rules of Civil Procedure , Plaintiffs hereby accept Defendants [sic] June 15, 2017 offer to allow judgment to be taken against Defendants “in the amount of $82,500, inclusive of interest, costs and attorneys’ fees, and without admission of liability, on each of the Causes of Action contained in the Complaint based upon facts existing as of the date of acceptance of the offer.” (Exhibit A).PLEASE TAKE FURTHER NOTICE that, as set forth in Plaintiffs’ January 31, 2016 Second Amended Complaint (Dkt. 18; Exhibit B, ¶¶ 118-183), as of the date of Defendants’ Offer of Judgment, Plaintiffs had eight (8) Causes of Action against Defendants.
PLEASE TAKE FURTHER NOTICE that Plaintiffs hereby accept a total of six hundred and sixty thousand dollars ($660,000.00), inclusive of interest, costs and attorneys’ fees, for full
and final settlement of all eight (8) Causes of Action contained in the Complaint based upon facts existing as of the date of acceptance of the offer.
App‘x at 27-28.
Although the Rules provide that if the
On July 7, 2017, Appellants filed with the district court a letter opposing Appellees’ July 5 request to decline filing the judgment proposed by Appellants. Appellants argued that the $82,500 referred to in the
After further litigation, Appellants moved for summary judgment on their claims and for “such other and further relief as [the] Court deems just and proper.” Motion for Summary Judgment at 1, Toth v. 59 Murray Enters., Inc., No. 15-cv-8028 (S.D.N.Y. 2019), ECF No. 79. Appellants’ further submissions, including their memorandum of law and a letter accompanying the summary judgment motion, explained that Appellants sought summary judgment on their compensatory damages based on the fair market value of the images, as well as a permanent injunction prohibiting Appellees from using Appellants’ images.
Appellees cross-moved for summary judgment and moved to strike the report
On January 3, 2019, the district court struck Chamberlin‘s report and testimony as speculative and based on unreliable methodology, and it granted summary judgment to Appellees on all of Appellants’ claims.
As to Appellants’ claims under
Accordingly, the district court dismissed the complaint and entered judgment for Appellees. Appellants timely appealed.
I. Rule 68 Offer of Settlement
[A] party defending against a claim may serve on an opposing party an offer to allow judgment on specified terms, with the costs then accrued. If, within 14 days after being served, the opposing party serves written notice accepting the offer, eithеr party may then file the offer and notice of acceptance, plus proof of service. The clerk must then enter judgment.
“Rule 68 offers of judgment and acceptances thereof are contracts to be interpreted according to ordinary contract principles.” Steiner, 816 F.3d at 31.
Appellants argue, however, that we have stated that “Rule 68 offers of judgment . . . are different from other contract offers in that they carry legal consequences: a party that rejects a Rule 68 offer may be subject to the cost-shifting provision of
“The primary goal of contract interpretation is to effectuate the intent of the parties as manifested by the language used in the contract.” Steiner, 816 F.3d at 34 (internal quotation marks and citation omitted). This Court‘s exposition of ambiguity under contract law in the Rule 68 context in Goodheart Clothing Co., Inc. v. Laura Goodman Enterprises, Inc. is instructive:
If a writing, or the term in question, appears to be plain and unambiguous on its face, its meaning must be determined from the four corners of the instrument without resort to extrinsic evidence of any nature. On the other hand, if the term in question does not have a plain meaning it follows that the term is ambiguous. Contract language is ambiguous if it is reasonably susceptible of more than one interрretation, and a court makes this determination by reference to the contract alone. Conversely, contractual language is unambiguous if it has a definite and precise meaning, unattended by danger of misconception in the purport of the contract itself, and concerning which there is no reasonable basis for a difference of opinion.
Appellants argue that the district court erred in concluding that Appellants had not accepted Appellees’ Offer of Judgment, arguing that (1) the contract unambiguously offered $660,000; and (2) even if the offer was ambiguous, our case law requires that the offer must be construed against the offeror, without looking to extrinsic evidence. In response, Appellees argue that the offer was ambiguous, and this ambiguity rendered the offer inoperative. “We review de novo a district court‘s interpretation of a Rule 68 offer.” Steiner, 816 F.3d at 31; see also Goodheart, 962 F.2d at 273 (“[I]nterpretation of a contract generally is a question of law, subject to de novo review.“).
[I]f, after all of the other guides to interpretation have been exhausted and the court concludes that there remain two reasonable interpretations of the contract, with each party knowing or having reason to know of the other party‘s understanding of the term, the court should as a policy matter, assuming it is clear that the parties have indeed attempted to enter into a contract, choose the interpretation that is adverse to the party that drafted the contract.
U.S. Naval Inst. v. Charter Commc‘ns, Inc., 875 F.2d 1044, 1050 (2d Cir. 1989) (quoted in 5 Corbin on Contracts § 24.27 (2020)). To apply contra proferentem to the threshold question of whether an enforceable contract existed—i.e., to whether there was mutual assent to be bound—would be the antithesis of its generally accepted purpose as an interpretive tiebreaker of last resort.
Here, for the reasons discussed below, there simply was no meeting of the minds: plaintiffs’ purported acceptance of the Offer of Judgment is more
For a valid Rule 68 agreement to have been formed, there must have been a “meeting of the minds” under elementary principles of contract law. See, e.g., Mallory v. Eyrich, 922 F.2d 1273, 1279-80 (6th Cir. 1991); Johnson v. Univ. Coll. of Univ. of Ala. in Birmingham, 706 F.2d 1205, 1209 (11th Cir. 1983); Radecki v. Amoco Oil Co., 858 F.2d 397, 400 (8th Cir. 1988) (“To decide whether there has been a valid offer and acceptance for purposes of Rule 68, courts apply the principles of contract law.“); Steiner, 816 F.3d at 31 (“Rule 68 offers of judgment and
“The plain purpose of Rule 68 is to encourage settlement and avoid litigation. . . . The Rule prompts both parties to a suit to evaluate the risks and costs of litigation, and to balance them against the likelihood of success upon trial on the merits.” Marek v. Chesny, 473 U.S. 1, 5 (1985). With respect to a suit seeking money damages, the process requires that the plaintiff, who can total his damages and the costs already incurred, be able to “compar[e] th[at] sum to the amount offered.” Id. at 7. “Thus, Rule 68 offers must provide ‘a clear baseline from which plaintiffs mаy evaluate the merits of their case relative to the value of the offer.‘” Basha v. Mitsubishi Motor Credit of Am., Inc., 336 F.3d 451, 455 (5th Cir. 2003) (quoting Thomas v. Nat‘l Football League Players Ass‘n, 273 F.3d 1124, 1130 (D.C. Cir. 2001); see also, e.g., Stanczyk v. City of New York, 752 F.3d 273, 283 (2d Cir. 2014) (“Rule 68 offers . . . must be capable of comparison to the judgment ultimately obtained[.]” (citation omitted)).
Because the offer purported to settle all claims, yet failed to quantify damages, . . . mutual assent did not exist between the parties. Moreover, such a vague offer of judgment did not provide Basha with a clear baseline to evaluate the risks of continued litigation. To hold otherwise would be to strip Rule 68 of its purpose.
Id. at 455 (emphasis added); see also Thomas, 273 F.3d at 1130 (explaining that “an unallocated offer of judgment to multiple plaintiffs is not effective under Rule 68” because no plaintiff would have been presented with a number against which to compare his or her likely recovery).
An offer that states a dollar amount to be specified in the judgment but does so using language that would permit the defendant to argue later that the offer was for a different amount has no Rule 68 validity. Appellants here point out that if they had simply stated that they accepted Appellees’ Offer of Judgment without attempting an explanation or elaboration, Appellees would have been free to point to the offer‘s reference to each cause of action, and to
In sum, because the Rule 68 offer was ambiguous as to what dollar amount the Appellees were offering—i.e., as to the most fundamental aspect of the proposed contract, the amount to be specified in the judgment—the Offer of Judgment was not a proper Rule 68 offer. There was here no mutual assent; Appellees’ Offer of Judgment was of no effect under Rule 68; the district court properly refused to enter the judgment proposed by Appellants; and Appellants
Because the parties never reached agreement on a settlement amount, the district court correctly refused to resolve ambiguities in Appellants’ favor and enter judgment for Appellants pursuant to their purported acceptance of the Rule 68 offer. We therefore affirm the July 26, 2017 order of the district court.
Finally, even if we were to conclude that, notwithstanding the fundamental ambiguity in the Offer of Judgment, a Rule 68 contract had somehow been formed calling for a Rule 68 judgment in the amount of $660,000, we would uphold the district court‘s refusal to entеr such a judgment on the ground that Appellees should be allowed to avoid the contract on the basis of mistake. Although unilateral mistake is generally not an impediment to the formation of a contract, it may in some circumstances allow the party that made the mistake to avoid the contract. “Where a mistake of one party at the time a contract was made as to a basic assumption on which he made the contract has a
In the context of a Rule 68 judgment, for example, where a defendant intended to make a Rule 68 offer of judgment in the amount of $500 but because of a typographical error offеred $500,000, which was accepted by plaintiffs in a case in which they had made no money demand prior to filing suit, the complaint alleged that that defendant had caused actual damage only in the
The circumstances surrounding Appellees’ Rule 68 offer here support the district court‘s refusal to enter a Rule 68 judgment. Appellees made their formal Rule 68 offer of $82,500 only after making an informal offer to settle the entire case for that amount. Appellants rejected the informal offer and made a counter-offer to settle for $800,000. Appellees then rejected that counter-offer in a June 15, 2017 email to Appellants’ counsel, and in that email stated, “We are going to file an offer of judgment for the amount previously offered.” App‘x at 33. On that same day, Appellants made the Offer of Judgment at issue here. Appellants have not disputed, either in the district court or here, that this was the sequence of events, or that they received and understood the June 15 email. This undisputed record reveals that Appellants knew Appellees intended to have a Rule 68
II. Claims Under New York Civil Rights Law § 51
“We review a district court‘s grant of summary judgment de novo.” Brandon v. Kinter, 938 F.3d 21, 31 (2d Cir. 2019). For summary judgment to be warranted, the movant must “show[] that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.”
A. New York Civil Rights Law §§ 50-51
Though New York courts do not recognize a common law action for invasion of privacy,
Any person whose name, portrait, picture or voice is used within this state for advertising purposes or for the purposes of trade without the written consent first obtained as above provided [in Section 50] may maintain an equitable action in the supreme court of this state against the person, firm or corporation so using his name, portrait, picture or
voice, to prevent and restrain the use thereof; and may also sue and recover damages for any injuries sustained by reason of such use . . . .
New York courts hold that
In Arrington v. New York Times Co., the Court of Appeals held that allegations that a photograph distributor sold the plaintiff‘s image to a newspaper without the plaintiff‘s consent sufficed to state a claim for nonconsensual commercialization of an image for purposes of trade. 55 N.Y.2d 433, 443 (1982). Soon thereafter, the New York legislature amended
[N]othing contained in this article shall be so construed as to prevent any person, firm or corporation from selling or otherwise transferring any material containing such name, portrait, picture or voice in whatever medium to any user of such name, portrait, picture or voice, or to any third party for sale or transfer directly or indirectly to such a user, for use in a manner lawful under this аrticle . . . .
Accordingly, in actions under
B. The Terms of the Release Agreements for Shake‘s and Hinton‘s Photographs Are Disputed
It is conceded that the Club Companies used Appellants’ pictures within the state of New York for the purposes of advertising or trade, see Molina, 747 N.Y.S.2d at 230, and Appellees do not argue that any exceptions apply. Further, it is undisputed that the Club Companies lacked written consent from Appellants to use their images in Club advertisements. For use of the photographs in the Club Companies’ advertisements to be lawful, then, we look
Whether a
The district court granted Appellees summary judgment after finding that each Appellant with a timely
It is undisputed that Lee, Koren, and Mayes entered into agreements releasing all their rights to the photographs and authorizing assignment, license,
While the parties agree that Shake entered into a release for the photograph at issue, this release is not in the record. The parties dispute the terms of the release, including whether the releasee would receive all proprietary rights to the image or be able to use the image for any purpose. Shake testified
Further, while Appellants did not dispute Appellees’ statement in their
In summary, though there was no dispute of material fact raised relating to the releases for the photographs of Lee, Koren, Mayes, and Golden, the terms of the releases for the photographs of Shake and Hinton present disputed questions
C. Whether the Releases Bar Appellants’ Section 51 Claims
Relying on the release agreements in the record, the district court concluded that Appellants had executed agreements releasing all their proprietary rights to the photographs and authorizing releasees to allow third parties to use the photographs for any purpose. The district court held that the release agreements disclaimed Appellants’ rights to challenge the use of the photographs, barring Appellants’
Under New York law, “the terms of a contract may be enforced only by contracting parties or intended third-party beneficiaries of the contract . . ..” Rajamin v. Deutsche Bank Nat. Tr. Co., 757 F.3d 79, 86 (2d Cir. 2014). Here, both parties agree that the Club Companies and their contractors—including Brown, IMC, and Melange—were not parties to the releases, and that there are no other agreements between Appellants and the Club Companies or their contractors authorizing the use of the photographs. In addition, Appellees conceded during oral argument that the contractors secured no legal rights to use the photographs, such as through an assignment or license. Appellees and their contractors are plainly not third-party beneficiaries of the release agreements. See
We further conclude that the releases are not written consent for purposes of
A cause of action under
True, where an individual‘s right of privacy has been invaded there are certain other elements which may be taken into consideration in assessing the damages. Thus, where a cause of action under the Civil Rights statute has been established, damages may include recovery for a so-called ‘property’ interest inherent and inextricably
interwoven in the individual‘s personality, but it is the injury to the person not to the property which establishes the cause of action. That is the focal point of the statute.
Id. (citation omitted).6 The district court‘s conclusion that the release agreements defeated Appellants’ claims would construe
Thus, Lee‘s and Mayes’ releases in favor of Dreamgirl, Koren‘s release in favor of Gianatsis Design Associates, and Golden‘s release in favor of Leg Avenue do not constitute written consent for all others to use their images for purposes of advertising or trade. That their releases conveyed their proprietary rights to the photographs does not defeat their claims, because their cause of action under
The district court held that even if the comprehensive releases for the photographs at issue did not defeat Appellants’
Appellants argue that the district court erred in striking the report of their damages expert, Stephen Chamberlin, and that Appellants were entitled to prove damages at trial. Appellees respond that that (1) the district court correctly struck
“The decision to admit expert testimony is left to the broad discretion of the trial judge and will be overturned only when manifestly erroneous.” Zerega Ave. Realty Corp. v. Hornbeck Offshore Transp., LLC, 571 F.3d 206, 213 (2d Cir. 2009).
- the expert‘s scientific, technical, or other specialized knowledge will help the trier of fact to understand the evidence or to determine a fact in issue;
- the testimony is based on sufficient facts or data;
- the testimony is the product of reliable principles and methods; and
- the expert has reliably applied the principles and methods to the facts of the case.
We nevertheless conclude that the exclusion of the Chamberlin Report is not fatal to Appellants’ claims. The SAC alleges that Appellees “violated
Due to Defendants’ violation of Plaintiffs’ rights of privacy and publicity under
sections 50 and51 of the N.Y. Civil Rights Act , Plaintiffs [have] been damaged in an amount to be determined at trial, but in all events not less than seventy-five thousand dollars ($75,000.00), exclusive of punitive and exemplary damages.In addition, and pursuant to
section 51 of the N.Y. Civil Rights Act , Plaintiffs hereby request[] an Order permanently enjoining Defendants from violating Plaintiffs’ right to privacy and publicity.In addition, and likewise pursuant to
section 51 of the N.Y. Civil Rights Act , Plaintiffs hereby request an award of punitive damages, in an amount to be determined at trial, due to Defendants knowing and intentional violation of their statutory rights to privacy and publicity.
App‘x at 91. Appellants thus brought suit under
We also conclude that the striking of the Chamberlin Report does not necessarily preclude Appellants from seeking damages. The SAC plainly asserts as a basis for compensatory damages the violation of Appellants’ statutory rights of both privacy and publicity. New York‘s statutory right of privacy “is based upon the classic right of privacy‘s theoretical basis, which is to prevent injury to feelings.” Lombardo v. Doyle, Dane & Bernbach, Inc., 396 N.Y.S.2d 661, 664 (App. Div. 2d Dep‘t 1977). Consequently, damages for the violation of New York‘s statutory right of privacy “often are only nominal since they are designed primarily to compensate for injury to feelings.” Lerman v. Flynt Distrib. Co., Inc., 745 F.2d 123, 141 (2d Cir. 1984); see, e.g., Grant v. Esquire, Inc., 367 F. Supp. 876, 881 (S.D.N.Y. 1973) (explaining that the plaintiff will “be entitled to recover for any lacerations to his feelings that he may be able to establish” if the jury decides in his favor); Harris v. H.W. Gossard Co., 185 N.Y.S. 861, 863 (App. Div. 1st Dep‘t 1921) (affirming the award of six cents in recompense for the injured feelings of a
Nominal damages are damages nonetheless. Appellants at least initially sought recovery of damages before the district court for mental distress and embarrassment caused by the use of their images in advertisements for strip clubs before the district court. Accordingly, the district court, on remand, may consider whether Appellants may recover on this theory.
As to whether Appellants can seek to recover the fair market value of the images as compensation, Appellees argue that (1) Appellants did not establish that they were entitled to recover the fair market value of their images, and (2) even if fair market value were the proper measure of damages, Appellants cannot establish the fair market value of their images in the absence of the
In striking the Chamberlin Report, the district court relied in part on its reasoning that Appellants’ fair market value damages theory was “fundamentally suspect” because, as they “negotiated with a willing buyer and were paid the fair market value for any and all rights to the images” already, allowing them “to be compensated a second time would be a clear windfall.” Toth, 2019 WL 95564, at *12. As we have explained, however, a
We are not aware of any precedent holding that an expert opinion is required to prove compensatory damages in an action under
“It is well settled that expert testimony is unnecessary in cases where jurors are as capable of comprehending the primary facts and of drawing correct conclusions from them as are witnesses possessed of special or peculiar training.” Wills v. Amerada Hess Corp., 379 F.3d 32, 46 (2d Cir. 2004) (internal quotation marks and citation omitted). The district court made no conclusions as to the necessity of an expert opinion, and we decline to answer that question in the first instance. On remand, the district court can consider whether an expert
III. Other Claims
Appellants also challenge the district court‘s grant of summary judgment to Appellees alleging that Appellees unlawfully used photographs of them without their consent to advertise strip clubs that Appellees owned, in violation of the Lanham Act,
“On appeal from a grant of summary judgment, the findings with respect to predicate facts underlying each Polaroid factor are reviewed with considerable deference to the district court.” Playtex Prods., Inc. v. Ga.-Pac. Corp., 390 F.3d 158, 162 (2d Cir. 2004) (internal quotation marks and footnote citation omitted), superseded on other grounds as recognized in Starbucks Corp., 588 F.3d at 107-08. In addition, this Court “review[s] the district court‘s decision to admit or exclude expert testimony under a highly deferential abuse of discretion standard.” Zuchowicz v. United States, 140 F.3d 381, 386 (2d Cir. 1998).
We conclude that the district court correctly dismissed Appellants’ Lanham Act claim. The district court properly analyzed the record of each Appellant‘s public prominence to determine the strength of their marks, because among other reasons, the advertisements at issue provided no information identifying Appellants other than their pictures. See Bondar v. LASplash Cosmetics, No. 12-cv-1417, 2012 WL 6150859, at *7 (S.D.N.Y. Dec. 11, 2012)
For substantially the same reasons as those set out in the district court‘s opinion, we also conclude that the district court did not abuse its discretion in striking Appellants’ expert report (the “Buncher Report“) about a survey conducted of individuals who frequented strip clubs on their perceptions of the advertisements. Among other defects, the survey on which the Buncher Report was based asked respondents about only a small fraction of the images at issue, and it failed to provide respondents with an opportunity to indicate lack of knowledge about how to interpret the use of Appellants’ images in the
Appellants point to no evidence of actual consumer confusion. And while Appellants urge this Court to conclude that Appellees acted in bad faith, the record merely shows that Appellees failed to investigate whether the third-party contractor responsible for the advertisements secured legal rights to use Appellants’ pictures in the promotional images—not that Appellees intended to use the pictures without legal right to do so.
We next turn to Appellants’ appeal from the dismissal of their claim under
We agree with the district court that the misconduct alleged here was not consumer-oriented. The gravamen of Appellants’ complaint is that Appellees used their modeling images without their consent, a private dispute over a
Lastly, we consider Appellants’ libel claim. “Under New York law, a plaintiff must establish five elements to recover in libel: 1) a written defamatory statement of fact concerning the plaintiff; 2) publication to a third party; 3) fault (either negligence or actual malice depending on the status of the libeled party); 4) falsity of the defamatory statement; and 5) special damages or per se actionability (defamatory on its face).” Celle v. Filipino Rep. Enters. Inc., 209 F.3d 163, 176 (2d Cir. 2000). Actual malice “must be supported by clear and convincing proof” that the publisher of the statements “had a subjective awareness of either falsity or probable falsity of the defamatory statement, or acted with reckless disregard of . . . its truth or falsity.” Id. at 182-83. Appellants primarily argue that the advertisements were false defamatory statements
These arguments are without merit. First, we agree with the district court that it was a reasonable interpretation of the use of Appellants’ images in the advertisements that Appellants were not employed in Appellees’ clubs, but merely modeled in the clubs’ advertisements. Insofar as the advertisements were therefore “reasonably susceptible of multiple meanings, some of which [were] not defamatory, it [was] then for the trier of fact, not for the court acting on the issue solely as a matter of law, to determine in what sense the words were used and understood.” Celle, 209 F.3d at 178 (internal quotation marks omitted). Accordingly, the district court correctly denied Appellants’ motion for summary judgment. Second, we agree with the district court that Appellants failed to adduce clear and convincing proof of actual malice. As previously discussed, Appellants at most have shown that Appellees failed to investigate whether the
Accordingly, the order of the district court hereby is affirmed as to Appellants’ claims under the Lanham Act,
CONCLUSION
For the foregoing reasons, we affirm the July 26, 2017 order of the district court, vacate so much of the January 3, 2019 judgment of the district court as applies to the Section 51 claims of Lee, Mayes, Koren, Shake, Hinton, and Golden, affirm the remainder of the January 3, 2019 judgment, and remand for further proceedings consistent with this opinion.
App‘x at 115 (Exhibit E to the SAC)
Notes
193 N.Y. 223, 230-31 (1908), aff‘d, 220 U.S. 502 (1911).[A]s to pictures whose ownership remained in the person represented at the time when the act took effect, or portraits subsequently made, a transfer of ownership no longer conveys the right to use the picture for advertising purposes, unless the written consent of the person portrayed shall have been given. The acquisition of such pictures by itself does not carry with it the right to use them for advertising or trade purposes, except with the written consent of the person represented; but the statute in no wise forbids the transfer of the right so to use them, provided that right is conferred by a written consent to that effect.