Ocean City Nightclub Wins Trademark Infringement Lawsuit Against Resort Chain

By Joseph Mandour on October 15, 2011

beach-dune-thumb-200x150-30039 California – A Maryland jury recently returned a verdict finding that travel destination and resort company Coryn Corporation infringed a trademark owned by popular Ocean City nightclub O.C. Seacrets.
O.C. Seacrets, a large nightclub and resort complex in the Maryland resort town of Ocean City, brought the action against Coryn Corporation alleging that Coryn’s trademark “Secrets” for use with resort hotels infringes the “Seacrets” trademark owned by the nightclub.

O.C. Seacrets registered the trademark “Seacrets” with the USPTO in 1997 for restaurant and bar services. Since that time, O.C. Seacrets has expanded to include several bars, restaurants, a nightclub, as well as a hotel and condominium units. The complex takes up three blocks of Ocean City’s bay front.

In 2000, Travel destination and resort operator Coryn Corporation filed an intent to use the trademark “Secrets” in conjunction with resort hotel services in the U.S. After the trademark was officially registered by the USPTO, O.C. Seacrets filed a petition to cancel the “Secrets” trademark, alleging that the trademark was in a similar class to its own “Seacrets” trademark and that use of the trademark would create a likelihood of consumer confusion. The Trademark Trial and Appeal Board granted O.C. Seacrets’ petition to cancel in 2008 citing Seacret’s priority over the trademark and the potential likelihood for confusion. Coryn appealed the decision and its continuing use of the trademark led O.C. Seacrets to file an action for trademark infringement in a Maryland federal district court.

Trademark infringement occurs when someone other than a trademark owner uses a trademark in commerce that is confusingly similar to another trademark. When a trademark holder registers a trademark, it must select the class of goods and services in which the trademark will be used. While using a confusingly similar trademark in the same class of goods may constitute trademark infringement, using a similar trademark on an entirely different class of product may not amount to trademark infringement.

In this case, O.C. Seacrets claimed that its services, restaurant and bar services which have expanded to include hotel and condominium services, were similar to the services claimed by Coryn Corporation for resort hotel destinations. After a weeklong trial, the jury deliberated for two hours before returning a verdict in favor of O.C. Seacrets. The jury awarded nominal damages of $1 and punitive damages of $200,000. However, Coryn Corporation will continue to operate “Secrets” resorts outside of the United States in Jamaica, Mexico, and the Dominican Republic.

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