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Chris Jones

Ruling Favors R&R in Slogan Battle

27 July 2005

On the verge of today's scheduled settlement conference before a Reno magistrate judge, a higher ranking U.S. District Court judge issued a ruling late on Monday that could bolster R&R Partners' case against California businesswoman Dorothy Tovar.

R&R, the Las Vegas-based advertising company that created the popular "What happens here, stays here" marketing campaign for its client, the Las Vegas Convention and Visitors Authority, has for the past 16 months engaged in a trademark infringement case against Tovar.

Tovar markets T-shirts and other products with similar phrases such as "What happens in Vegas, stays in Vegas" through Adrenaline Sports, her exclusive licensee.

Despite the objections of Tovar's Sacramento, Calif.-based attorney, Daniel Ballard, who called the step an attempt to play "both sides of the fence," U.S. District Court Judge Larry Hicks approved R&R's May 27 request to make the convention authority a co-plaintiff in the Tovar case, court documents show.

"If it is determined that R&R lacks standing because it is not a real party in interest in this matter, then LVCVA would be a real party in interest with standing to sue," Hicks wrote. "In other words, if one of them lacks standing to sue, the other has authority to sue, and vice versa."

R&R and the convention authority have recently become involved in a media-fueled scandal surrounding authority President Rossi Ralenkotter's clandestine November deal to transfer ownership of "What happens here, stays here" trademark to R&R for $1.

Ballard claimed R&R had no right to sue Tovar since the trademark was owned by the authority when court proceedings began. As a result, R&R purchased the trademark from the authority in November, with an effective back date of Jan. 1, 2004.

Both Ralenkotter and Billy Vassiliadis, R&R's chief executive officer, classified the sale as a legal strategy, though several members of the authority board say they should have been told of the sale in advance.

The San Francisco office of Morrison & Foerster was recently hired to assist the authority's case against Tovar, if Hicks allowed it to participate, as well as to investigate the $1 deal on behalf of the board.

That investigation is now under way, though its results won't become public until the Tovar case is settled.

Separately, Hicks agreed to R&R's request to make Adrenaline Sports a co-defendant in the case, and approved a third request to add a fraud charge that alleges Tovar did not take a required step to properly protect her "What happens in Vegas, stays in Vegas" trademark with the U.S. Patent & Trademark Office, which she claimed to have done during a March 31 deposition.

Despite Hicks' ruling, Luke Puschnig, the authority's in-house legal counsel, said Tuesday that parties on both sides of the dispute still plan to attend today's settlement conference before Robert McQuaid, a Reno-based magistrate judge.

Vassiliadis was traveling Tuesday and could not be reached for comment. Calls seeking comment from R&R's attorneys were also unsuccessful.

Ballard also failed to return a call placed to his office after business hours on Tuesday.