New York — The trademark dispute between Sony’s Ultra Records, LLC, and Ultra International Music Publishing, LLC (UIMP), owned by Patrick Moxey, has escalated as the case nears trial in the Southern District of New York. Court filings obtained by World Music Views (WMV) provide a detailed look at UIMP’s defense, which challenges the trademark infringement claims, contests Ultra Records’ demand for monetary damages, and disputes the request for a permanent injunction.
The Core of the Dispute: Ownership of the “ULTRA” Mark
The legal battle centers on the use of the “ULTRA” trademark. Ultra Records, which is fully controlled by Sony Music Entertainment (SME) following Moxey’s sale of his remaining 50% stake in 2021, claims that UIMP is unlawfully using the “ULTRA” mark in its music publishing operations. Despite receiving a significant payout from Sony and officially parting ways with Ultra Records, Moxey’s UIMP continues to operate under the “ULTRA” name, which Sony argues is in violation of trademark rights.
In its pretrial memorandum, Ultra Records alleges that UIMP’s use of the “ULTRA” mark is not only infringing but has also caused confusion in the marketplace, damaging the brand and reputation of Ultra Records. As a result, Ultra Records is seeking both financial compensation, including profits allegedly generated by UIMP’s actions, and a permanent injunction to stop further use of the trademark.
In the response submitted the the court on November 19, UIMP argues that it has a legitimate right to continue using the “ULTRA” mark in music publishing, a sector separate from Ultra Records’ business of music recording. UIMP insists that it has operated in good faith and in accordance with a historical coexistence agreement, which it believes granted it the right to use the mark within the publishing space, independent of Ultra Records’ operations.
UIMP’s Defense Against the Injunction
One of UIMP’s key defenses is its assertion that Ultra Records has failed to demonstrate any actual harm caused by UIMP’s use of the “ULTRA” mark. According to UIMP’s filing, Ultra Records has not provided tangible evidence of lost sales, reputational damage, or price erosion resulting from the alleged infringement.
“Ultra Records has failed to identify any real harm,” UIMP argues in its response. “Despite claiming consumer confusion, the emails presented by Ultra Records as evidence do not support the allegation of confusion over the trademark.” UIMP further asserts that these emails were either routine communications or unrelated to the use of the mark, and that no evidence exists showing that these interactions led to consumer confusion in the buying process.
UIMP also points out that Ultra Records waited nearly a year after sending a cease-and-desist letter before filing the lawsuit, which UIMP claims weakens the argument for irreparable harm or urgency. “There is no public benefit to issuing an injunction, especially when our customers—songwriters, streaming services like Spotify, and licensing entities—are not at risk of confusion,” UIMP contends.
Coexistence Agreement and Ownership Claims
A cornerstone of UIMP’s defense is its argument that it had a good-faith belief that it was entitled to use the “ULTRA” mark for music publishing purposes. UIMP argues that both Ultra Records and SME were aware of its use of the trademark, and that this use was consistent with a coexistence agreement between the parties.
“Under the terms of the 2012 agreement, Ultra Records acknowledged UIMP’s use of the ‘ULTRA’ mark for music publishing,” UIMP asserts. “This was not a license agreement but a coexistence arrangement that permitted UIMP to use the mark while Ultra Records used it in the recording business.”
UIMP’s legal team also maintains that it owned the rights to the “ULTRA” mark for publishing, asserting that Moxey made the decision when UIMP was established to control the music publishing business under the “ULTRA” name. UIMP points out that Ultra Records never claimed ownership of the “ULTRA” mark in this sector, as evidenced by its failure to register the mark for music publishing services.
Furthermore, UIMP argues that Ultra Records’ failure to assert ownership in this area supports its position. “Ultra Records never sought to claim rights in the music publishing field, and their failure to pursue trademark registration for ‘ULTRA’ in that sector further underscores our claim to the mark.”
Dispute Over Profits and Financial Impact
Ultra Records has claimed that UIMP profited $14 million from its use of the “ULTRA” mark and is seeking these profits as part of its damages claim. However, UIMP counters that no profits were made from the alleged trademark infringement. Instead, UIMP argues it has sustained losses in its music publishing operations.
“UIMP has not derived any financial benefit from the use of the ‘ULTRA’ mark,” UIMP asserts. “The trademark did not contribute to any profits, and the use of the mark in music publishing was entirely separate from Ultra Records’ core business.”
UIMP also challenges Ultra Records’ accounting of expenses and profits. The company asserts that its accounting practices, which have been approved by Sony, involve reasonable deductions for business operations. These include co-publishing and catalog purchases, which Ultra Records now disputes. UIMP argues that Ultra Records is unfairly attempting to inflate the damages claim by questioning these standard deductions.
The Request for Dismissal
UIMP is requesting the dismissal of Ultra Records’ claims, asserting that the latter has failed to prove any of the elements necessary for a successful trademark infringement case. “Ultra Records has not provided sufficient evidence of harm,” UIMP’s filing states. “We acted in good faith, and our use of the ‘ULTRA’ mark was fully supported by the historical agreements in place between the parties.”
UIMP’s defense hinges on the legitimacy of its use of the trademark and its belief in the legal right to continue using the “ULTRA” name in music publishing. The company also stresses that no malicious intent or bad faith is involved in the continued use of the mark.
The final pretrial conference will take place at 2 pm on November 25, 2024 in Courtroom 15A, 500 Pearl Street, New York, NY 10007. Trial will commence at 9 AM on Monday, December 2, 2024.
