2nd Circuit Panel Awards Partial Victory to Models Over Strip Club Ads

Steven T. Lowe

In October 2015, multiple models, including “Baywatch” actress Carmen Electra (“Electra”) (collectively the “models”), filed suit against various New York strip clubs alleging that such clubs used their likeness in intentionally misleading advertisements without permission or payment. As a result of this misuse, the models claimed that they were substantially damaged because the success of their careers is largely dependent on being selective with brands and companies that they model for, as well as protecting their goodwill and reputation, which they rely upon to establish their individual brands and secure modeling contracts.

The models moved for an early win in the case by way of a motion for summary judgment. The models alleged that the strip clubs’ use of their images for advertisements was an attempt to deceive their customers into believing that the models not only endorsed the business itself but were also likely to make appearances at the establishments. U.S. District Judge Naomi R. Buchwald ruled in January 2019 that only Electra proved that her strong trademark barred these strip clubs from using her images for advertisements without her consent, but the other models failed to make the same showing. In fact, Judge Buchwald noted that the other models’ claims were defeated by their signing of releases to the photos to multiple Manhattan-based strip clubs.

All parties appealed. This case went before the Second Circuit Court of Appeals. The three-judge panel dealt a partial victory to the models on February 9, 2021, finding that the lower court erred. Specifically, the Second Circuit found that these models did not enter into a “comprehensive” release that gave multiple New York strip clubs “unlimited rights” to use their images. The panel found that the lower court further erred in holding the strip clubs not liable for violating New York right of publicity laws as the terms of the releases for two of the models “present disputed questions,” and the releases for the other models clearly did not qualify as written consent under New York state publicity laws, especially where the strip clubs were not even parties to the releases. Further, the models did not sign any release granting legal rights to the images at issue.  In finding the above, the Second Circuit concluded: “while the releases could provide a defense in an action against the releases or those who could assert lawful use by reason of assignment or license, [the strip clubs] concede that they had no legal rights to the images.”

After affirming the decision of the lower court to strike a damages report from the models’ expert as “speculative” and unreliable in the expert’s estimation of the photos’ fair market value, the panel sent the case back to the lower court to decide the issues of “whether an expert opinion was needed to show the fair market value of the photos, and whether the models can provide another one in light of the district judge’s decision to strike their earlier report.”  The appellate panel also affirmed the lower court dismissal of the claims of the models (other than Electra), alleging that the strip clubs violated federal trademark law through the use of their images in advertisements without their consent.

The plaintiffs are represented by John V. Golaszewski of The Casas Law Firm PC.

The defendants are represented by Peter T. Shapiro of Lewis Brisbois Bisgaard & Smith LLP.

The case is Electra et al. v. 59 Murray Enterprises Inc. et al., case number 19-235, in the U.S. Court of Appeals for the Second Circuit.

* Lowe & Associates (“The Firm”) is an entertainment and business law firm located in Beverly Hills, California. The firm has extensive experience handling cases involving publicity/privacy law, having provided top-quality legal services to its clients since 1991. The Firm is recognized for its many achievements, including successfully litigating many high-profile cases.

Find us at our website at www.LoweLaw.com