Roberto Coin, Inc. v. Goldstein

MEMORANDUM & ORDER

ERIC KOMITEE, UNITED STATES DISTRICT JUDGE

This case arises out of the relationship between plaintiff Roberto Coin, Inc. (“RCI”), a jewelry designer, and defendants Joseph Goldstein and his company, Kings Stone US, Ltd. Goldstein and Kings Stone supplied RCI with a gemstone they called “black jade” for a time. After RCI stopped sourcing black jade from Kings Stone and found a new supplier, Goldstein contacted a No. of stores selling RCI jewelry and disparaged RCI's stones. Both sides now claim the other is liable for false advertising, among other claims.

RCI sued first, asserting that the Defendants made “flatly false” statements to induce RCI's customers to drop RCI's new products in favor of Goldstein's, in violation of the Lanham Act. (For example, RCI alleges that Goldstein told one of RCI's customers that RCI's stones were to real black jade as

cubic zirconia is to diamond.) RCI claimed, in addition, that Goldstein and Kings Stone infringed RCI's trademarks by using photographs of Roberto Coin jewelry and RCI's logo in Kings Stone's advertising after RCI terminated the relationship. RCI also brought certain state-law claims.

Kings Stone countersued RCI (also under the Lanham Act), alleging that after dropping Kings Stone, RCI made false claims about (a) the gemological content of the stones from its new supplier and (b) whether those stones had been “certified” by a laboratory. Kings Stone also brought third-party claims against Roberto Coin (the founder of RCI himself, after whom RCI is named), alleging Lanham Act and related state-law claims.

Several motions are pending. RCI moves for summary judgment against Goldstein on each of RCI's affirmative claims. RCI and Roberto Coin also move to dismiss Kings Stone's counterclaims and third-party claims, respectively, on the basis that Kings Stone has been unrepresented for an extended period and cannot proceed without counsel. Goldstein is now proceeding pro se and has not submitted a formal motion for summary judgment. Nevertheless, I construe his letter of April 13, 2020 (ECF No. 137) as a motion for summary judgment on RCI's claims, as discussed below.

For the reasons that follow, I grant RCI's and Roberto Coin's motion to dismiss Kings Stone's counterclaims and third-

party claims for failure to prosecute; I deny without prejudice RCI's motion for default judgment on its claims against Kings Stone; I grant RCI's motion for summary judgment in part and deny it in part; and I grant Goldstein's motion for summary judgment in part and deny it in part.

I. Background

RCI filed a Statement of Material Facts under Local Rule 56.1 in support of summary judgment; neither defendant, however, filed the required counterstatement. The following factual recitation is drawn from the uncontested evidence identified in RCI's Rule 56.1 Statement and also, given Goldstein's pro se status, the Court's review of the evidentiary record, including Goldstein's deposition testimony.^[1] Given the cross-motions, I consider each motion independently and view all facts in the light most favorable to the non-moving party. Morales v. Quintel Ent., Inc., 249 F.3d 115, 121 (2d Cir. 2001).

A. Factual Background

1. Kings Stone Supplies Stones to RCI

The relationship between RCI and Kings Stone began in 2012. See Declaration of CKC Jewelry Company Managing Director Philip Grima (“Grima Decl.”) ¶ 3, ECF No. 138-13. Goldstein met with Roberto Coin to say that he had obtained access to a form of black amphibole jade that (according to Goldstein) was previously unknown. See Excerpts from Goldstein Deposition (“Goldstein Dep.”) 39:19, 135:12, ECF No. 138-29.^[2] Mr. Coin expressed interest.

Beginning “in or around May 2013, ” CKC Jewelry Company, the RCI affiliate that manufactures Roberto Coin jewelry (“CKC”), placed “significant orders” for Kings Stone's gemstones. Grima Decl. ¶ 3. The stones were to be used in RCI's new “Black Jade” collection. Id. The parties did not enter into a written contract in connection with the purchase and sale of these stones, apart from the exchange of purchase orders or invoices.

“Several months” after it began supplying stones to CKC, Kings Stone provided RCI with an analysis prepared by the National Gem Testing Center (“NGTC”) - a gemstone testing

laboratory based in China - stating that the mineral content of its stones was “black amphibole jade.” Id. ¶ 4; see also ECF No. 138-14 (certifications provided by Kings Stone).

Soon thereafter, RCI communicated its dissatisfaction with multiple aspects of Kings Stone's performance. See ECF No. 138-15 (emails dated August 27, 2013 to October 25, 2013 between Goldstein and CKC). CKC complained about the pace of deliveries and the quality and condition of Kings Stone's product. Id. By mid-2014, CKC and RCI decided to end the relationship with Kings Stone. Grima Decl. ¶ 6. Thereafter, RCI obtained a new supplier and continued to market the “Black Jade” collection. See id.; see also Declaration of RCI President Peter Webster (“Webster Decl.”) ¶ 25, ECF No. 126-15.

2. Goldstein Uses RCI's Trademark

About a year and a half after the split with Kings Stone, RCI discovered that the Defendants were using photographs of RCI jewelry alongside RCI's trademarked logo, as well as the name “Roberto Coin, ” on Kings Stone's Instagram feed. See Webster Decl. ¶ 9; ECF No. 138-4 (RCI trademarks); ECF No. 138-5 (Instagram posts). Goldstein acknowledged this use, though he claimed that the Instagram images were posted only for a short period. See Rule 30(b)(6) Deposition of Joseph Goldstein as

representative of Kings Stone (“Kings Stone Dep.”) 221:7-17, ECF No. 138-36.

Goldstein also acknowledges that he sent marketing materials incorporating RCI images to various vendors, including in a PowerPoint presentation. Goldstein Dep. 133:22-134:10, 356:14-357:15. He claims that he believed RCI “knew about” and “was okay” with this: “I know 100 percent for sure they [RCI] have received [the PowerPoint presentation], and they knew about it, so it was okay when I disseminated that information.” Id. at 356:20-22.

In January 2016, RCI's counsel sent Goldstein a letter demanding that he remove the images from Kings Stone's Instagram feed and “stop any such conduct for the future.” ECF No. 138-5 (RCI cease-and-desist letter). She wrote that Goldstein was not lawfully authorized to use Roberto Coin's photographs or trademarks, and that there was “no evidence that the ROBERTO COIN jewelry shown in your Instagram page are made with your jade.” Id. Instagram (not Goldstein) ultimately removed the posts at issue. Kings Stone Dep. 221:11-17.

3. Goldstein Contacts RCI Retailer Borsheims

In November 2017, Goldstein emailed Borsheims, a jewelry retailer based in Omaha, Nebraska that sold RCI products (including the Roberto Coin “Black Jade” collection). ECF No.

138-7 at 13.^[3] In his initial entreaty, Goldstein did not mention RCI; instead, he simply requested that Borsheims sell jewelry incorporating Kings Stone's black jade. Id. Goldstein described Kings Stone's black jade as “exclusively certified by the china NGTC and the prestigious U.S. based AGL as Black jade.” Id. (capitalization as in original). A Borsheims buyer wrote back to say that Borsheims “would not be interested” in purchasing Kings Stone's product. Id.

Approximately five months later, Goldstein emailed Borsheims again, this time pretending to be a customer. Goldstein said he was looking for a “gift for a jade connoisseur.” Id. at 9 (email dated April 8, 2018). He expressed interest in a specific item - “the Roberto Coin 18K Rose Gold & Diamond Black Jade 3 Shank Ring” - and asked Borsheims to provide him with “a gem certificate that verifies its authenticity as genuine black jade.” Id.

Borsheims' employee wrote back to say that she had contacted RCI, and that “while they do not have official certificates of authenticity for their jade gemstones, they provided me with the attached card detailing the certification of the jade along with further details.” Id. at 8 (email dated April 9, 2018). The “attached card” contained photographs of

RCI jewelry and the following text: “The most fascinating black amphibole jade, 100% natural identified and certified by China's National Gemstone Testing Center (NGTC) is the protagonist of the homonymous ‘Black Jade' collection.” Id.; see also ECF No. 15-5 (showing attached card).

One day after receiving this card, Goldstein emailed Borsheims again. He referred to the Black Jade ring about which he had previously inquired, writing that it:

does not come with any certification as to its authenticity that the black jade is genuine. If there is no certification available, then legally you cannot claim or advertise that it is black jade, no less then [sic] claiming a cubic zirconia being a real diamond . . . . My black jade comes with full certification by 3 major Gemological Labs. When dealing with my certified black jade stones you are assured of the highest quality and no reputational risk to your company by selling non certifiable black jade. The real black jade jewelry companies are doing great with our line with sales exceeding the best projections.

ECF No. 138-7 at 12. Goldstein followed up the next day with an email to another Borsheims employee, referring to the same ring and stating that “[w]e have asked Roberto Coin directly numerous times for confirmation of the black jade authenticity and we have not received any response.” Id. at 7.

Eleven minutes after this last email, Goldstein threatened Borsheims with legal action. He stated that Kings Stone was being “effected by the Fake black jade being...