The opinion of the court was delivered by: KEEP
AMENDED ORDER DENYING PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION
On February 27, 1998, plaintiff Playboy Enterprises, Inc. (PEI) filed a Complaint against defendant Terri Welles. The Complaint consists of five causes of action: 1) trademark infringement pursuant to 15 U.S.C. § 1114(1);
2) false designation of origin and unfair competition under 15 U.S.C. § 1125(a);
3) dilution of trademarks pursuant to 15 U.S.C. 1125(c); 4) trademark infringement and unfair competition under California common law; 5) unfair competition in violation of Cal. Bus. & Prof. Code § 17200, et seq.
On March 18, 1998, plaintiff filed a Motion for Preliminary Injunction. Defendant filed an Opposition on April 6, 1998. Plaintiff filed its Reply on April 13, 1998. The court heard oral arguments on April 20, 1998.
The following background facts are taken from the parties' contentions in their papers, but the court does not make any ultimate findings of fact with respect to this case. Plaintiff Playboy Enterprises, Inc. (PEI) is an international publishing and entertainment company. Since 1953, PEI has published Playboy magazine, a widely popular magazine with approximately ten (10) million readers each month. PEI also publishes numerous specialty magazines such as Playboy's Playmate Review, Playboy's Playmates of the Year, and Playboy's Calendar Playmates among other publications. In addition to its publishing ventures, PEI produces television programming for cable and direct-to-home satellite transmission and sells and licenses various goods and services including videos.
PEI has established two websites. According to plaintiff, its free website, http://www.playboy.com, has become one of the most popular sites on the Web and is used to promote its magazine, goods, and services. Its other website, called the "Playboy Cyber Club," http://www.cyber.playboy.com, is devoted to promoting current and former PEI models.
PEI owns federally registered trademarks for the terms Playboy, Playmate, Playmate of the Month, and Playmate of the Year. The term Playmate of the Year is sometimes abbreviated "PMOY." PEI does not have a federally registered trademark in the abbreviation "PMOY," although PEI argues that "PMOY" is worthy of trademark protection because it is a well-known abbreviation for the trademark Playmate of the Year.
Defendant Terri Welles is a self-employed model and spokesperson, who began her modeling career with Playboy magazine in 1980. In May of 1980, Ms. Welles appeared on the cover of Playboy magazine and was subsequently featured as the "Playmate of the Month" in the December 1980 issue. Ms. Welles received the "Playmate of the Year" award in June of 1981. Since 1980, Ms. Welles has appeared in no less than thirteen (13) issues of Playboy magazine and eighteen (18) newsstand specials published by PEI. Defendant claims that she has always referred to herself since 1980 as a "Playmate" or "Playmate of the Year" with the knowledge of PEI.
On June 29, 1997, Ms. Welles opened a website, http://www.terriwelles.com, which includes photographs of herself and others (both nude and clothed), a fan club posting board, an autobiography section, and a listing of current events and personal appearances. The domain name for defendant's site is "terriwelles," the heading for the website is "Terri Welles--Playmate of the Year 1981," and title of the link page is "Terri Welles--Playboy Playmate of the Year 1981." Each of the pages uses "PMOY '81" as a repeating watermark in the background. According to defendant, eleven (11) of the fifteen (15) free web pages include a disclaimer at the bottom of the pages, in varying font sizes depending on the page, which indicates that the website is not endorsed by PEI; the disclaimer reads as follows: "This site is neither endorsed, nor sponsored by, nor affiliated with Playboy Enterprises, Inc. PLAYBOY, PLAYMATE OF THE YEAR and PLAYMATE OF THE MONTH are registered trademarks of Playboy Enterprises, Inc." Defendant uses the terms Playboy and Playmate along with other terms within the keywords section of the meta tags, which constitutes the internal index of the website used by some search engines.
The site contains link pages to other erotic, adult-oriented websites. It also contains advertising "banners" for some of those websites.
Since May of 1997, defendant has been in contact with plaintiff about the design and creation of her website. Defendant claims that plaintiff, through Marcia Terrones, the director of the "Rights and Permission" department at PEI, informed her that she could identify herself as the "Playmate of the Year 1981" but that she could not reproduce the rabbit head logo on her proposed website. Various communications between defendant and plaintiff ensued. According to defendant, PEI, through Hug Hefner, initially complimented her website and encouraged her use of the title "Playmate of the Year 1981." However, Mr. Hefner later informed defendant that use of PEI's trademarks were restricted; instead, he invited defendant to join PEI's new Cyber Club. Defendant refused this invitation, and PEI continued to demand that defendant remove the "Playmate of the Year" title from the home page as well as remove the PMOY watermark from the background.
Plaintiff has moved for a preliminary injunction which would enjoin defendant from 1) using the trademarked term Playmate of the Year in the title of the home page and the link page; 2) from using the watermark "PMOY '81" in the background; and 3) from using the trademarked terms Playboy and Playmate in the meta-tagging of defendant's site. Therefore, the task before the court is to determine whether a preliminary injunction against defendant is warranted in this instance.
To be entitled to a preliminary injunction, a party must show either (1) a combination of probable success on the merits and a possibility of irreparable harm, or (2) the existence of serious questions on the merits and the balance of hardships weighing heavily in its favor. Vision Sports v. Melville, 888 F.2d 609, 612 (9th Cir. 1988). These are not two distinct tests, but ends of a continuum in which the required showing of harm "varies inversely with the required showing of meritoriousness." Rodeo Collection v. West Seventh, 812 F.2d 1215, 1217 (9th Cir. 1987) (citation omitted). "Thus, a moving party need not demonstrate that [it] risks irreparable injury, but [it] must at least show that [it] will suffer a degree of hardship that outweighs the hardship facing the opposing party if the injunction is not issued. Similarly, a moving party need not ...