Avid Vs Digisec and Vice Versa - Digisec Answer To Complaint

Case 2:12-cv-08602-JAK-MAN Document 11 Filed 03/14/13 Page 1 of 18 Page ID #:76
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Larry W. McFarland (Bar No. 129668)

E-Mail: lmcfarland@kilpatricktownsend.com
Christopher T. Varas (Bar No. 257080)
E-Mail: cvaras@kilpatricktownsend.com
KILPATRICK TOWNSEND & STOCKTON LLP
9720 Wilshire Boulevard
Penthouse Suite
Beverly Hills, California 90212
Telephone: (310) 248-3830
Facsimile: (310) 860-0363
Attorneys for Defendants
DIGISEC MEDIA AS and
SIGURD VEDAL
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UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA
WESTERN DIVISION
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AVID LIFE MEDIA, INC., an Ontario

corporation, and AVID DATING LIFE,
INC., an Ontario corporation dba
ASHLEY MADISON,
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ANSWER TO COMPLAINT
Plaintiffs,
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Case No.: 12-08602 JAK (FMOx)
DEMAND FOR JURY TRIAL
v.
DIGISEC MEDIA AS dba
www.victoriamilan.com, a Norway
company; SIGURD VEDAL, an
individual; and DOES 1 THROUGH 10,
Defendants.
Defendants DIGISEC MEDIA AS and SIGURD VEDAL (collectively
Defendants) jointly and severally respond to the complaint of AVID LIFE MEDIA,
INC. and AVID DATING LIFE, INC. (collectively Plaintiffs) (Plaintiffs and
Defendants are collectively referred to as Parties) as follows:

DEFENDANTS INTRODUCTORY ALLEGATIONS
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Defendants make the following introductory allegations, which are incorporated

into each and every paragraph of this Answer.
A.
Defendants are informed and believe that Plaintiffs have filed this lawsuit
in bad faith and with full knowledge that their claims are entirely without merit.
B.
For example, and without limitation, Defendants are informed and
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believe that the depiction of a woman with her finger near her sealed lips alleged in,
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and attached to, Plaintiffs Complaint (the Alleged Trade Dress Image) is nothing
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but a superficial modification of a third party stock image in which Plaintiffs own
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no rights, and which is currently available for anyone to license from its real owner
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through <istockphoto.com> (and possibly other sites), as shown below. A true and
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correct copy of the relevant <istockphoto.com> page is attached hereto as Exhibit A.
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Plaintiffs Alleged Trade Dress
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Image Available For License From

<iStockPhoto.com>
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C.
The real infringer in this dispute is Avid. For example and without
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limitation, as alleged in Digisec Ltd.s related lawsuit against Plaintiffs and other
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related defendants (Case No. CV13-01849), Defendants are informed and believe that
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-2ANSWER
CASE NO. 12-08602 JAK (FMOx)
Avid has willfully infringed Digisecs rights by registering and using the domain
names <victoriarnilan.com> (which replaces the m in milan with the letters r
and n), <victoriamilandating.com> and <victoriamilan.ca> with a bad faith intent to
profit from Digisecs distinctive registered VICTORIA MILAN mark, including by
creating fake Victoria Milan websites designed to trick consumers into signing up
with Avid in the mistaken belief that they are doing business with Digisec.
D.
The website located at <victoriarnilan.com> is a virtual replica of the
Ashley Madison website, and features the deceptive headline Victoriarnilan.com
presentsASHLEY MADISON. Not surprisingly, every link on this website
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funnels users directly to Avids <ashleymadison.com> website, which is not
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presented by or in any other way associated with Digisec. A true and correct copy
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of this website is attached hereto as Exhibit B, and reproduced below with red ovals
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added to indicate the multiple infringing uses of <victoriarnilan.com>.
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-3ANSWER
E.
Defendants are informed and believe that Avid is using
<victoriamilandating.com> for similar deceptive purposes. That website purports to
be a blog owned and operated by Digisec, and even features text that has been copied
word for word from Digisecs copyrighted VICTORIA MILAN website, as well as
numerous unauthorized uses of the registered VICTORIA MILAN mark and an
unauthorized confusingly similar variation of Digisecs service mark RELIVE THE
PASSION FIND YOUR AFFAIR. Notwithstanding this extensive unauthorized use
of Digisecs intellectual property, the website is filled with advertisements for, and
links to, the <ashleymadison.com> website. Defendants are informed and believe that
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Avid or someone acting under Avids direction or control created this website in order
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to confuse and deceive consumers searching for Digisecs services into clicking
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through to Avids own website that competes directly with Digisec. A true and
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correct copy of the home page of this website (including an edited version of the
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pornographic image that appears at the top of home page) is attached hereto as
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Exhibit C and incorporated herein by reference.
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F.
contained herein, Defendants answer Plaintiffs complaint as set forth below.

DEFENDANTS RESPONSES TO THE ALLEGATIONS IN PLAINTIFFS
COMPLAINT
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In accordance with the foregoing and all other allegations and averments
Nature of Action
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Answering Paragraph 1 of the Complaint, Defendants are without
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knowledge or information sufficient to form a belief as to the truth of the allegations
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contained in Paragraph 1, and on that basis deny each and every such allegation.
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2.
Answering Paragraph 2 of the Complaint, Defendants admit that the
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Complaint purports to request damages and injunctive relief. Except as expressly
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admitted herein, Defendants deny each and every allegation contained in Paragraph 2.
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-4ANSWER
The Parties
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5.
Answering Paragraph 5 of the Complaint, Defendants admit that Digisec
Media AS is a Norwegian company with its principal place of business located at
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Martin Linges vei 25, N-1364 Fornebu, Norway. Defendants aver that Digisec Media
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AS previously owned and operated the VICTORIA MILAN website located at
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<victoriamilan.com>.
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deny each and every allegation contained in Paragraph 5.
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6.
Except as expressly admitted or averred herein, Defendants
Answering Paragraph 6 of the Complaint, Defendants aver that Sigurd
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Vedal was previously the Chief Executive Officer of Digisec Media AS. Except as
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expressly averred herein, Defendants deny each and every allegation contained in
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Paragraph 6.
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7.
Answering Paragraph 7 of the Complaint, Defendants aver that Paragraph
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7 of the Complaint does not contain any allegations to which a response is required.
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To the extent a response to Paragraph 7 is required, Defendants deny each and every
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such allegation contained in Paragraph 7.
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8.
Answering Paragraph 8 of the Complaint, Defendants aver that the
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purported allegations in Paragraph 8 are conclusions of law or fact to which no
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responsive pleading is required. To the extent a response to Paragraph 8 is required,
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Defendants deny each and every such allegation contained in Paragraph 8.
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-5ANSWER
Jurisdiction And Venue
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Answering Paragraph 12 of the Complaint, Defendants deny each and
every allegation contained in Paragraph 12.

13.
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VICTORIA MILAN website that is available to United States users (hereinafter the
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United States VICTORIA MILAN Website) is not a purely passive website. Except
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as expressly admitted herein, Defendants deny each and every allegation contained in
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Paragraph 13.
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United States VICTORIA MILAN Website is accessible by Internet users located in
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this Judicial District. Except as expressly admitted herein, Defendants deny each and
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United States VICTORIA MILAN Website is accessible by Internet users located in
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this Judicial District, and that it is possible for users to submit payments through the
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-6ANSWER
United States VICTORIA MILAN Website. Except as expressly admitted herein,
Defendants deny each and every allegation contained in Paragraph 15.

Factual Allegations
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Answering Paragraph 17 of the Complaint, Defendants admit that Exhibit
C to the Complaint purports to be a print-out of the home page to which the domain
name <ashleymadison.com> resolves. Except as expressly admitted herein,
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purported allegations in the first sentence of Paragraph 19 are conclusions of law or
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fact to which no responsive pleading is required. To the extent a response to the first
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sentence of Paragraph 19 is required, Defendants deny each and every such allegation
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contained in the first sentence of Paragraph 19. Defendants are without knowledge or
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information sufficient to form a belief as to the truth of the allegations contained in the
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second and third sentences of Paragraph 19, and on that basis deny each and every
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such allegation.
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20.
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21.
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-7ANSWER
22.
parties are competitors. Except as expressly admitted herein, Defendants deny each
and every allegation contained in Paragraph 22.
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Answering Paragraph 23 of the Complaint, Defendants aver that
consumers located in the United States were previously able to access the global
VICTORIA MILAN website at <victoriamilan.com>. Defendants further aver that
currently, consumers located in the United States who navigate to
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<victoriamilan.com> are redirected to the United States VICTORIA MILAN Website
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at <victoriamilan.us>. Except as expressly averred herein, Defendants deny each and
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Answering Paragraph 24 of the Complaint, Defendants admit that both
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parties provide discreet online dating services that cater to married or attached adults.
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Except as expressly admitted herein, Defendants deny each and every allegation
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contained in Paragraph 24.
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25.
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VICTORIA MILAN service was launched in 2010. Except as expressly admitted
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herein, Defendants deny each and every allegation contained in Paragraph 25.
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26.
Answering Paragraph 26 of the Complaint, Defendants admit that
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Digisec received correspondence from Avid regarding the European market in or
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around January of 2011. Except as expressly admitted herein, Defendants deny each
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and every allegation contained in Paragraph 26.
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27.
Answering Paragraph 27 of the Complaint, Defendants admit that they
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received correspondence from Avids Swedish counsel [f]urther to Avids January,
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2011 letter regarding the European market in or about March of 2011. Except as
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-8ANSWER
expressly admitted herein, Defendants deny each and every allegation contained in
Paragraph 27.
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29.
Answering Paragraph 29 of the Complaint, Defendants admit that
Digisec Media AS filed United States Trademark Application Serial No. 79109849.
Except as expressly admitted herein, Defendants deny each and every allegation
contained in Paragraph 29.
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30.
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FIRST CAUSE OF ACTION
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(For Federal Trade Dress Infringement/False Designation of Origin and Unfair
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Competition under 15 U.S.C. 1125(a))
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(Against All Defendants)
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31.
Answering Paragraph 31 of the Complaint, Defendants refer to and
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incorporate Paragraphs A through F and 1 through 30 of this Answer as though fully
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set forth herein.
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32.
Answering Paragraph 32 of the Complaint, Defendants admit that Exhibit
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C to the Complaint purports to be a print-out of the home page to which the domain
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name <ashleymadison.com> resolves. Except as expressly admitted herein,
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34.
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-9ANSWER
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Defendants deny each and every such allegation contained in Paragraph 38, and also
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deny that Plaintiffs have suffered any injury or damages whatsoever.
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purported allegations in Paragraph 39 are conclusions of law or fact, or a prayer for
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relief, to which no responsive pleading is required. To the extent a response to
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Paragraph 39 is required, Defendants deny each and every such allegation contained
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in Paragraph 39, and also deny that Plaintiffs have suffered any injury or damages
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whatsoever.
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40.
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-10ANSWER
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whatsoever.
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whatsoever.
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SECOND CAUSE OF ACTION
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(Federal Trade Dress Dilution under 15 U.S.C. 1125(c))
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set forth herein.
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-11ANSWER
46.
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Defendants deny each and every such allegation contained in Paragraph 47, and also
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deny that Plaintiffs have suffered any injury or damages whatsoever.
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48.
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whatsoever.
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-12ANSWER
whatsoever.
THIRD CAUSE OF ACTION
(Common Law Unfair Competition)
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set forth herein.
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whatsoever.
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whatsoever.
FOURTH CAUSE OF ACTION
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(For Unfair Competition under Cal. Bus. & Prof. Code 17200)
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set forth herein.
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whatsoever.
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-14ANSWER
whatsoever.
DEFENDANTS AFFIRMATIVE DEFENSES
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Defendants jointly and severally assert the following affirmative defenses to

each and every one of Plaintiffs causes of action.
First Affirmative Defense: Failure To State A Claim
The Complaint and each and every cause of action asserted therein fails to state
a claim upon which relief can be granted.
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Second Affirmative Defense: Lack Of Standing
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Each and every cause of action asserted in the Complaint is barred because
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Plaintiffs lack standing.
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Third Affirmative Defense: Unclean Hands
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Each and every cause of action asserted in the Complaint is barred by the
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doctrine of unclean hands.
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Fourth Affirmative Defense: Breach of License
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Plaintiffs are maintaining them in breach of their non-exclusive license to use the
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Alleged Trade Dress Image.
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Fifth Affirmative Defense: Estoppel, Waiver & Acquiescence
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doctrines of estoppel, waiver and acquiescence.
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Sixth Affirmative Defense: Laches
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doctrine of laches.
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Seventh Affirmative Defense: Fair Use
doctrine of fair use.
Eighth Affirmative Defense: Functionality
Plaintiffs alleged trade dress is functional.
Ninth Affirmative Defense: Genericness
Plaintiffs alleged trade dress is generic.
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Tenth Affirmative Defense: License
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Defendants have at all times acted in conformance with the terms of the license
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agreement(s) under which they obtained the image(s) alleged to be infringing.
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Eleventh Affirmative Defense: No Ownership
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Plaintiffs do not own any right to their alleged trade dress, including without
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limitation the Alleged Trade Dress Image.
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Twelfth Affirmative Defense: No Trademark/Trade Dress Use
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Plaintiffs have not used the alleged trade dress as an indicator of source.
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Thirteenth Affirmative Defense: Abandonment
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Each and every cause of action asserted in the Compliant is barred because
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Plaintiffs have abandoned any rights they may have had in their alleged trade dress.
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Fourteenth Affirmative Defense: Naked Licensing
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Plaintiffs have lost any rights they may have had in their alleged trade dress through
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the uncontrolled, or inadequately controlled, licensing of such trade dress.
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-16ANSWER
Fifteenth Affirmative Defense: Descriptive Use
Defendants use of the allegedly infringing image(s) has at all times been purely
descriptive.
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Sixteenth Affirmative Defense: Contributory and/or Comparative Negligence

Each and every cause of action asserted in the Complaint is barred because any
confusion or damage that Plaintiffs have suffered was directly and proximately caused
or contributed to by Plaintiffs own negligence in failing to exercise reasonable care in
protecting their alleged rights.
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Seventeenth Affirmative Defense: Failure to Mitigate
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Plaintiffs have failed to mitigate their alleged damages.
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Eighteenth Affirmative Defense: Any Confusion Was Created By Plaintiffs
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Plaintiffs themselves have created any likelihood of confusion by their own deliberate
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actions, including without limitation by associating a depiction of a woman with her
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finger near her sealed lips with a confusingly similar variation of the registered
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VICTORIA MILAN mark on <victoriarnilan.com>.
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Nineteenth Affirmative Defense: Lack Of Sufficient Particularity To Identify All
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Defenses
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The Complaint does not describe the facts or claims being alleged with
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sufficient particularity to permit Defendants to ascertain what other defenses may
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exist. Defendants will rely on all further defenses that become available during
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discovery in this action. Defendants expressly reserve the right to amend this Answer
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for purposes of asserting such additional affirmative defenses, or to assert such
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additional affirmative defenses as permitted by law.
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-17ANSWER
DEFENDANTS PRAYER FOR RELIEF
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WHEREFORE, Defendants Digisec Media SA and Sigurd Vedal pray for relief
jointly and severally in defense against Plaintiffs claims as follows:
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That Plaintiffs take nothing by their complaint;
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That judgment be entered in favor of Defendants and against Plaintiffs;
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That the Court award Defendants their reasonable costs of suit;
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That the Court find this to be an exceptional case for purposes of 15
U.S.C. 1117(a), and award Defendants their reasonable attorneys fees
and costs of suit, together with pre-judgment and post-judgment interest.
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Dated: March 14, 2013
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By: /s/Christopher T. Varas

Christopher T. Varas
KILPATRICK TOWNSEND &
STOCKTON LLP
Attorneys for Defendants Digisec Media
AS and Sigurd Vedal
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DIGISEC MEDIA AS AND SIGURD VEDAL DEMAND A JURY TRIAL.
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Dated: March 14, 2013
By:
/s/Christopher T. Varas
Christopher T. Varas
KILPATRICK TOWNSEND &
STOCKTON LLP
Attorneys for Defendants Digisec Media
AS and Sigurd Vedal
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-18ANSWER

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Case 2:12-cv-08602-JAK-MAN Document 11 Filed 03/14/13 Page 1 of 18 Page ID #:76

Larry W. McFarland (Bar No. 129668)

UNITED STATES DISTRICT COURT

AVID LIFE MEDIA, INC., an Ontario

Case No.: 12-08602 JAK (FMOx)

DEMAND FOR JURY TRIAL

Case 2:12-cv-08602-JAK-MAN Document 11 Filed 03/14/13 Page 2 of 18 Page ID #:77

Defendants DIGISEC MEDIA AS and SIGURD VEDAL (collectively

Defendants are collectively referred to as Parties) as follows:

Defendants make the following introductory allegations, which are incorporated

For example, and without limitation, Defendants are informed and

correct copy of the relevant <istockphoto.com> page is attached hereto as Exhibit A.

Plaintiffs Alleged Trade Dress

Image Available For License From

CASE NO. 12-08602 JAK (FMOx)

Case 2:12-cv-08602-JAK-MAN Document 11 Filed 03/14/13 Page 3 of 18 Page ID #:78

names <victoriarnilan.com> (which replaces the m in milan with the letters r

and n), <victoriamilandating.com> and <victoriamilan.ca> with a bad faith intent to

profit from Digisecs distinctive registered VICTORIA MILAN mark, including by

The website located at <victoriarnilan.com> is a virtual replica of the

Ashley Madison website, and features the deceptive headline Victoriarnilan.com

presentsASHLEY MADISON. Not surprisingly, every link on this website

funnels users directly to Avids <ashleymadison.com> website, which is not

added to indicate the multiple infringing uses of <victoriarnilan.com>.

CASE NO. 12-08602 JAK (FMOx)

Case 2:12-cv-08602-JAK-MAN Document 11 Filed 03/14/13 Page 4 of 18 Page ID #:79

Defendants are informed and believe that Avid is using

<victoriamilandating.com> for similar deceptive purposes. That website purports to

numerous unauthorized uses of the registered VICTORIA MILAN mark and an

unauthorized confusingly similar variation of Digisecs service mark RELIVE THE

PASSION FIND YOUR AFFAIR. Notwithstanding this extensive unauthorized use

Exhibit C and incorporated herein by reference.

contained herein, Defendants answer Plaintiffs complaint as set forth below.

Answering Paragraph 1 of the Complaint, Defendants are without

knowledge or information sufficient to form a belief as to the truth of the allegations

Answering Paragraph 2 of the Complaint, Defendants admit that the

Complaint purports to request damages and injunctive relief. Except as expressly

CASE NO. 12-08602 JAK (FMOx)

Case 2:12-cv-08602-JAK-MAN Document 11 Filed 03/14/13 Page 5 of 18 Page ID #:80

Answering Paragraph 3 of the Complaint, Defendants are without

knowledge or information sufficient to form a belief as to the truth of the allegations

Answering Paragraph 4 of the Complaint, Defendants are without

knowledge or information sufficient to form a belief as to the truth of the allegations

Answering Paragraph 5 of the Complaint, Defendants admit that Digisec

Media AS is a Norwegian company with its principal place of business located at

AS previously owned and operated the VICTORIA MILAN website located at

deny each and every allegation contained in Paragraph 5.

Except as expressly admitted or averred herein, Defendants

Answering Paragraph 6 of the Complaint, Defendants aver that Sigurd

Answering Paragraph 7 of the Complaint, Defendants aver that Paragraph

such allegation contained in Paragraph 7.

Answering Paragraph 8 of the Complaint, Defendants aver that the

purported allegations in Paragraph 8 are conclusions of law or fact to which no

responsive pleading is required. To the extent a response to Paragraph 8 is required,

Defendants deny each and every such allegation contained in Paragraph 8.

CASE NO. 12-08602 JAK (FMOx)

Case 2:12-cv-08602-JAK-MAN Document 11 Filed 03/14/13 Page 6 of 18 Page ID #:81

Jurisdiction And Venue

Answering Paragraph 9 of the Complaint, Defendants aver that the

purported allegations in Paragraph 9 are conclusions of law or fact to which no

responsive pleading is required. To the extent a response to Paragraph 9 is required,

Defendants deny each and every such allegation contained in Paragraph 9.

Answering Paragraph 10 of the Complaint, Defendants aver that the