International Cafe v. Hard Rock Cafe International

This case requires us to determine whether a United States district court has subject matter jurisdiction--based on the Lanham Act, 15 U.S.C. § 1051 et seq, and the Paris Convention for the Protection of Industrial Property, 24 U.S.T. 2140 (2)--over a claim for unfair competition by a foreign Plaintiff against a United States corporation for acts occurring mainly outside the United States. The district court dismissed for lack of subject-matter jurisdiction. We also conclude that no subject-matter jurisdiction exists, and we therefore affirm.

Plaintiff International Café, S.A.L. is a Lebanese corporation that operates a restaurant called Hard Rock Café in Beirut, Lebanon.

Defendants are Hard Rock Café International (U.S.A.), Inc. ("HRC"), a Florida corporation that licenses Hard Rock Café restaurants worldwide and claims control of the Hard Rock Café brand; HRC Canada, Inc. ("HRCC"), a Canadian corporation that Plaintiff alleges is a wholly owned subsidiary controlled by HRC; and Rank Canada, Inc., a Canadian corporation that guaranteed HRCC's obligations under a purchase agreement. Also pertinent to this appeal is Hard Rock Café Limited ("HRC Limited"), which issued Hard Rock Café franchises to individuals in countries other than the United States. HRCC purchased HRC Limited in 1996.

According to the complaint, in August, 1991, Nouhad Khalil obtained the exclusive rights to use the Hard Rock Café name and logo in Lebanon with the express authorization of HRC Limited. In Lebanon, Khalil registered the Hard Rock Café name and logo, obtained a Certificate of Registration of a Commercial Store and a Permit for Deposit of a Trademark, and received notification from the Head of the Protection Ownership Administration. He also procured a 25-year lease, built a restaurant and parking facility, and purchased original rock 'n roll memorabilia from around the world. In June 1996, Plaintiff (3) and HRC Limited formalized their agreement in writing, and Plaintiff's Hard Rock Café restaurant opened in November 1996.

Approximately one month later, HRC authorized another Hard Rock Café franchise in Beirut, less than one mile from Plaintiff's Hard Rock Café restaurant. (4) During this same time, HRCC purchased HRC Limited. The purchase price for HRC Limited included the licensing rights that HRC Limited possessed for the Hard Rock Café name and marks worldwide.

Plaintiff alleges that, since HRCC's purchase of HRC Limited and the opening of the second Hard Rock Café restaurant in Beirut, HRC has attempted to close down Plaintiff's Hard Rock Café restaurant. HRC specifically refused to distribute Hard Rock Café merchandise to Plaintiff, and HRC filed criminal and civil charges against Khalil in Lebanon. (5) Plaintiff claims that HRC receives benefits from its Lebanon restaurant in the United States in the form of franchise fees, royalties, and commissions from the sale of merchandise.

Plaintiff then filed suit in the Middle District of Florida alleging unfair competition under the Lanham Act, 15 U.S.C. § 1126, and breach of contract under state law. Plaintiff claimed that he has the exclusive rights to use the Hard Rock Café name and logos in Lebanon because he first registered and used the name and logo there. Plaintiff also sought permanent injunctive relief and declaratory relief. The district court granted Defendants' motion to dismiss based on lack of subject-matter jurisdiction. Plaintiff appeals.

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Affirmed.

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