In re

LORRAINE A. TEMPLE, fdba Godwin Glacier Sled Dog Tours,

Debtor(s)

Case No. A02-00352-DMD

In Chapter 7

MEMORANDUM DECISION DENYING ORDER TO SHOW CAUSE MOTION AND INJUNCTION, SUBJECT TO LIMITED EXCEPTIONS

Ultimate Tours, LLC, filed a motion ^1.

for an order to show cause why Lorraine Temple, the debtor, should not be held in contempt for violating a Consent Order regarding the sale of her interest in the various assets which she had used in her dog sled tour business at one time ^2.

and for an order enjoining the use of various assets of the Ultimate Tours. The motion will be denied. Ultimate Tours has not shown by clear and convincing evidence that Temple violated the Consent Order or that she was using assets which had been sold by the trustee to Ultimate Tours.

Temple originally owned 40% of the shares of the Ultimate Tours and James Cork owned 60%. Ultimate Tours was formed in March 2002 (about a month before Temple filed for bankruptcy), and Temple contributed some assets she owned from her prior operation of a dogsled business known as Godwin Glacier Dog Sled Tours for her 40% share. Temple’s contribution consisted of some tangible property, including dogs, dog sled equipment, tents, and the like, and two items of intangible property. The only items of intangible property contributed to Ultimate Tours was described as: "Godwin Glacier Dog Sled Tours Intangible Assets: name, USFS permit."

There is no mention of a CNN tape of Temple’s unusual business operation, done before she threw in with Ultimate Tours, or a picture showing Temple and the dog, Sababka, or any other intangible property – two items Ultimate Tours claims in its OSC motion are being wrongfully used by Temple. Nor, are any of these items mentioned under the tangible assets with enough specificity to show they are included in the initial contribution of Temple. ^3.

Shortly after Temple filed chapter 7 in April 2002, the trustee became suspicious of insider dealings between Temple and Cork, the co-owners of Ultimate Tours. The trustee considered challenging the transfer of assets just one month before the bankruptcy as an attempt to hide them from Temples’ creditors. Instead of litigating, however, the parties settled by proposing the adoption of the Consent Order ratifying the transfers and, in effect, quit-claiming whatever interest Temple’s bankruptcy estate had to Ultimate Tours. ^4.

Most of the assets were the very same ones that Temple had contributed in March 2002, to get an ownership interest in Ultimate Tours. The order also provided that Temple would not interfere with the business. ^5.

Temple had worked for the Ultimate Tours during the tourist season of 2002 and 2003, both before and after Ultimate Tours purchased the assets under the Consent Order. She was fired in August 2003. Cork and Temple had a romantic

7 ABR 455
relationship which ended at about the time she was fired. Apparently there were some dissension during 2002, also, that led Cork to seek some insulation from Temple’s interference with the business in the Consent Order.

An alleged unauthorized break into the Ultimate Tours’ office (not the subject of the OSC) and foot dragging on compliance with the Consent Order by Temple had all occurred prior to the OSC motion, and what remained was the Ultimate Tours’ complaints centered around Temple’s new website (allegedly referring to the Godwin Glacier Sled Dog Tours business), use of the CNN tape and some pictures she used on the website, the use of a post office box (this issue was resolved and withdrawn), and the use of the e-mail address “lthuskys@hotmail.com” or “lthuskys” in any format.

Temple has recently started a business which markets motivational talks to school assemblies based on her experiences in starting Godwin Glacier Dog Sled Tours. She uses a website on a domain named XYZ, and now uses an e-mail address of “lthuskys@hotmail.com.”

In the OSC motion, Ultimate Tours claims Temple is wrongfully using is the e-mail address which includes the user name “lthuskys.” But, the full description of the item sold by the trustee to Ultimate Tours is “lthuskys@ptialaska.net,” which was in the Ultimate Tours’ sole control by the time it filed its motion for an OSC.

Ultimate Tours asked for any expedited hearing on its OSC, which it received, but the court finds in retrospect that there was no looming threat or danger to its assets because of Temple’s behavior. Any violation of the Consent Order appears nominal and unintentional. While Temple once may have been recalcitrant in dealing with Cork, ^6.

the evidence does not

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persuade the court that she was being difficult in November 2003, with respect to the matters alleged in the OSC motion. The real fuel for this motion appears to be Cork’s former romantic interest in Temple. ^7.

A federal court may enforce its orders against a violation by finding the violator in contempt. ^8.

The moving party must establish contempt by clear and convincing evidence. ^9.

Ultimate Tours has not even shown it is entitled to prevail by a preponderance of the evidence. Its case is weak and insubstantial.

Ultimate Tours attempts to equate this case to Alderman v Iditarod Properties, ^10.

an Alaskan case involving two competing city tourist trolley businesses which operated next to each other, both using the Fourth Avenue Theatre name (or, a close facsimile of it), across from the bankruptcy court. Ultimate Tours claims the use of the name “Godwin Glacier Dog Sled Tours” in Temple’s new website will cause confusion and be an unfair trade practice or violation of Ultimate Tours’ right to the exclusive use of that trade name. As such, Ultimate Tours alleges an infringement. ^11.

In the present case, there is no reasonable possibility of confusion. Temple is entitled to say she once started and worked for Godwin Glacier Sled Dog Tours, as long as she does not say she still does. She is in no competition with the business of Ultimate Tours or any reasonable extension of that business and does not purport to currently use the name or engage in dog sled tours, and no one could reasonably be confused that her business might be related to Ultimate Tours’. The appearance of “Godwin Glacier Dog Sled Tours” in her new website under construction are remnants from her former website, which had not yet been cleaned up in the process of developing the new website. She was modifying this new website to suit her new business of making motivational speeches to school children about what a person could do if they had faith in themselves. By the time of the evidentiary hearing on the OSC motion, almost any possible offending reference had been removed, and the court finds the likelihood of confusion was and is extremely remote. Lacking this likelihood, there is no infringement. ^12.

There was some vague testimony about how Temple might use “metatags” in her website to direct customers of Ultimate Tours to her business or otherwise confuse them. “[M]etatags are HTML codes not visible to Web users, but used by search engines in determining which sites correspond to the keywords entered by a Web user.” ^13.

While the use of metatags can be done in a way to create a trademark infringement or unfair trade practice, ^14.

the evidence in this case is far too sparse to show that Temple’s new website does anything remotely actionable.

Regarding the alleged wrongful use of the e-mail address, the trustee did not sell the Ultimate Tours the use of “lthuskys,” but of the e-mail address, “lthuskys@ptialaska.net.” Temple’s use of “lthuskys@hotmail.com” and/or listing that e-mail address on a website regarding motivational speeches to school assemblies is not forbidden by the Consent Order nor remotely infringing on Ultimate Tours’ trademark or trade name.

The following are my findings on specific issues raised by the Ultimate Tours which remained at the final hearing on the OSC (plus, my findings about the post office box, which appears to have been settled):

WEBSITE PROBLEMS- Temple and the Ultimate Tours have agreed to various modifications to Temple's school assembly website on the XYZ domain. I believe any reference to the Ultimate Tours or Godwin Glacier Sled Dog Tours business by Temple was inadvertent, has or will be fully corrected, and only remotely could have caused any impact or confusion with the Ultimate Tours’ business. The order will state, as Temple has agreed, to delete the materials that the Ultimate Tours found offensive, which has, in fact, been accomplished to a large degree. The court will retain jurisdiction to hear any disputes about the cure which may arise.

POST OFFICE BOX- I expressed my opinion in an the interim order. This is a remote problem now, and Temple has not violated the Consent Order. I will not hold her in contempt or make her close the box number which Ultimate Tours has not been associated with recently. She has not violated the Consent Order, which proved unworkable due the Postal Services refusal to cooperate.

E-MAIL ADDRESS- The e-mail address sold consisted of a preamble or user ID, “lthuskys,” and the domain address, "ptialaska.net." Temple is not violating the letter or spirit of the Consent Order by using "lthuskys@hotmail.com." She will not have to change her use of the Hotmail address. In addition, the Ultimate Tours has not shown any reasonable possibility of damage. A search for "lthuskys" using Google and other web search engines only brought up three or four references to sites which existed before the bankruptcy. Ultimate Tours now owns the e-mail address "lthuskys@ptialaska.net," and Temple has no access to it. Ultimate Tours' motion for contempt vis-a-vis the e-mail address will be denied.

CNN TAPE AND IMAGE OF TEMPLE AND DOG IN BROCHURES- Temple did not contribute these items to the Ultimate Tours under the operating agreement. Without this predicate, there is insufficient evidence to hold her in contempt or order her to do anything. Her use of the tape at school assemblies as a motivational tool is so remote from Ultimate Tours’ business that any damage to the Ultimate Tours’ business is speculative. I will honor Temple’s offer to either edit the tape or preface it with a disclaimer as she suggested. Or, she may do this orally when she uses the tape, without editing it. This is without prejudice to the Ultimate Tours showing any of these items (the tape or the images) do belong to the Ultimate Tours in a proceeding which is not expedited. The court will also retain jurisdiction of this issue if any dispute about any editing or preamble Temple chooses to do with respect to the tape to remove references to pricing or the Ultimate Tours’ business to make it clear in the preamble or by editing that Temple is no longer connected to the Ultimate Tours’ business.

An appropriate order will be entered denying the OSC and incorporating those agreements the parties have worked out regarding the modification of the XYZ website, and Temple’s agreement to make some modifications to usage to of the CNN tape. Because both attorneys are outside the state for the holidays, the court will grant them 30 days to appeal. ^15.

2. Consent Order for Sale of Assets and Other Relief, Docket Entry 26, filed November 8, 2002.

3. See, Ultimate Tours, LLC, Operating Agreement, dated March 4, 2002, for a list of the tangible and intangible assets Temple transferred to Ultimate Tours for her 40% interest in it (attached as Exhibit 1, page 22 of 24, to the trustee’s Motion to Approve Settlement for Transfer of Assets Free and Clear of Liens, Docket Entry 20, filed October 10, 2002).

4. See, the trustee’s Motion to Approve Settlement And For Transfer of Assets Free and Clear of Liens, Docket Entry 20, filed October 10, 2002 for the background.

5. Curiously, the Consent Order does not convey to Cork or Ultimate Tours the 10% interest in Ultimate Tours that Temple owned when she filed bankruptcy. Does that mean she is still part owner of Ultimate Tours (the trustee has issued his final report, which was approved by the court, abandoning the balance of the estate back to Temple)? Given the bitter relationship between the parties, this might make for strange bedfellows. The Consent Order does enjoin her from interfering with the Ultimate Tours’ use of these assets, but it does not take away her 10% interest in the Ultimate Tours.

6. See, trustee’s Motion to Approve Settlement for Transfer of Assets Free and Clear of Liens, Docket Entry 20, filed October 10, 2002.

7. James Cork’s testimony on December 12, 2002, on audio of hearing at 3:03:35-55 p.m.

8. In re Weir, 173 BR 682, 691 (Bankr ED Cal 1994); Sun City Clinic of Chiropractic, Ltd. v Helvig (In re Helvig), 74 BR 204, 206 (Bankr D Ariz 1987) (debtor held in contempt for failing to return chiropractic business to third party).

11. Alderman, at 389-92; see, also, Murray v Cable National Broadcasting Co., 80 F3d 858, 860-61 (9^th Cir 1996).

13. Brookfield Communications, Inc. v West Coast Entertainment Corp., 174 F3d 1036, 1061 fn 23.