The legal squabble between Robert Morton’s Hard Rock Cafe and the celebrity-backed Planet Hollywood turned into the clash of lawyer interpretations yesterday, as both sides sought to put the proper spin on a recent federal court ruling.
Late last week, L.A. Federal Court Judge Richard Gadbois handed down two memorandum rulings in Morton’s suit against Planet Hollywood and, not surprisingly, both sides were quick to claim victory.
Morton had filed suit last year, claiming Planet Hollywood– whose backers include Arnold Schwarzenegger, Bruce Willis and Sylvester Stallone–was an illegal copy of Hard Rock’s entertainment and music-themed restaurants.
Planet Hollywood attorneys said Gadbois’ decision to throw out Morton’s claims of antitrust violations “dealt a severe blow” to the foundation of Hard Rock’s case.
The ruling said that Hard Rock, while alleging a conspiracy to monopolize the market, had failed to show facts supporting its case.
Judge Gadbois said he believed Planet Hollywood’s entry into the marketplace worked to increase, rather than decrease, competition.
“Mr. Morton’s theory is that Planet Hollywood is trying to force him out of business,” said a Planet Hollywood attorney Howard Weitzman. “But all you have to do is look at the business both establishments are doing. His restaurants are doing very well and so are ours. His restaurants are themed around music memorabilia, ours are centered around movie themes. We don’t feel there is any correspondence.”
Morton’s attorneys called the rulings a victory, since they upheld Hard Rock’s ability to sue for violations of the Federal Trademark Act and for breach of fiduciary duties on the part of licensing corporation Rank Organization–which owns Planet Hollywood and the rights to many Hard Rock Cafes–and a Rank officer, Robert Earl, former Morton partner and now one of the Planet Hollywood toppers.
They pointed to clauses in the rulings on Earl’s Rank obligations that say he “owes a duty of loyalty to the corporation and to the shareholders. The opening of Planet Hollywood could potentially dilute the Hard Rock Cafe mark and trade name…”