Newsgroups: rec.games.frp.dnd Subject: Complete text of TSR v. Mayfair Games Date: Thu, 8 Apr 1993 03:33:39 GMT AUTHORIZED FOR EDUCATIONAL USE ONLY COPR. (C) WEST 1993 NO CLAIM TO ORIG. U.S. GOVT. WORKS Not Reported in F.Supp. (Cite as: 1993 WL 79272 (N.D.Ill.)) TSR, INC., Plaintiff, v. MAYFAIR GAMES, INC., a corporation and Darwin P. Bromley, individually and as President of Mayfair Games, Inc., Defendants. No. 91 C 0417. March 17, 1993. MEMORANDUM OPINION AND ORDER SHADUR *1 TSR, Inc. ("TSR") has sued Mayfair Games, Inc. ("Mayfair") and its President Darwin Bromley ("Bromley"), seeking injunctive relief, damages and contract rescission on the basis of several claims: (1) copyright infringement, (2) trademark infringement, false designation and misappropriation, (3) unfair competition and (4) breach of contract, all arising from Mayfair's use on its products of TSR's "Advanced Dungeons and Dragons" trademark. TSR currently moves for summary judgment on the Fourth Count of its Amended Complaint, which asserts that Mayfair breached a 1984 Settlement Agreement (the "Agreement") between the parties. [FN1] Mayfair responds by asking for summary dismissal of that breach of contract claim. For the reasons stated in this memorandum opinion and order, each motion is granted in part and denied in part. Fed.R.Civ.P. ("Rule") 56 Standards Rule 56 principles impose on the movant the burden of establishing the lack of a genuine issue of material fact (Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986)). For that purpose this Court is "not required to draw every conceivable inference from the record--only those inferences that are reasonable"--in the light most favorable to the nonmovant (Bank Leumi Le- Israel, B.M. v. Lee, 928 F.2d 232, 236 (7th Cir.1991)). Where as here cross- motions are involved, that principle thus demands a dual perspective--one that this Court has described as Janus-like--that sometimes calls for the denial of both motions. This District Court's General Rule ("GR") 12(m) and 12(n) require factual statements in support of and in opposition to Rule 56 motions, and both sides have tendered such statements. TSR's statement in support of its motion is cited "P. 12(m)," while Mayfair's responsive statement is cited "D. 12(n)." Mayfair's statement of additional facts in support of its cross- motion is cited "D. 12(m)," and TSR's responsive statement is cited "P. 12(n)." [FN2] Where one party's assertion within its GR 12(m) statement is admitted by the other party, that will be indicated here by omitting "12(m)" and "12(n)," so that the citation will simply read "P-D P --" or "D-P P --" (the first- listed party being the one whose Rule 12(m) statement has been admitted). Facts TSR owns trademarks for the "Advanced Dungeons and Dragons" ("AD & D") [FN3] and "Dungeons and Dragons" ("D & D") role- playing game systems, [FN4] which were created by TSR co-founder E. Gary Gygax ("Gygax") (P. 12(m) P 8). [FN5] Such a role-playing game is a system of interactive story telling using maps, dice and an extensive set of rules (P-D P 7). "One participant acts as a referee narrating the adventure, describing problems and controlling the actions of supporting characters and events. The remaining players play out their roles in accordance with the rules." (P-D P 10). TSR places the AD & D trademarks on rules and accessories, as well as on adventure modules and supplements (P-D P 21). *2 In 1982 Mayfair began to produce and market adventure and reference books under the trademark "Role Aids" for use in playing AD & D (D. Mem. 10, P- D P 22). TSR complained to Mayfair that Mayfair was making improper and infringing use of the AD & D trademark, and the parties signed the Agreement on September 28, 1984 to govern Mayfair's future use of TSR's trademarks (P-D P 28). Under the Agreement Mayfair acknowledged TSR's ownership of the D & D and AD & D trademarks and agreed not to contest their validity (P. Ex. 1 s III, P-D P 29). Mayfair also agreed to use the AD & D trademarks solely in connection with Role Aids modules, advertising and promotional materials. TSR's trademark was to appear once on an advertisement, catalog, flyer or press release, and only within a specific emblem form [FN6] in which Mayfair would state that the Role Aids product involved is for use with the AD & D role-playing game and that AD & D is a registered trademark of TSR, and would disclaim TSR's approval of that specific use of TSR's trademark by Mayfair (P. Ex. 1 s I and Ex. B, P- D PP 30-32). Mayfair's own symbol was required to appear on the same page. Mayfair also agreed (2) to phase out all noncomplying packaging, (2) not to use TSR's trademark in any other manner and (3) not to include statements on Role Aids modules carrying the AD & D trademark that such modules were suitable for use with other role-playing games (P. Ex. I ss IV-V and Ex. B, P-D 136). If materials violating the Agreement were distributed, Mayfair was required to make good faith efforts to recover such materials and to withdraw and withhold offending materials from distribution (P. Ex. 1 s VI, P-D 12(n) P 38). Despite the foregoing prohibitions, Mayfair was not prohibited from acquiring from the creators of Dungeons and Dragons, Arneson and Gygax, any of their rights to use the D & D trademark (P. Ex. 1 s V, D-P P 121). Unsatisfied with Mayfair's performance, on January 22, 1991 TSR filed its initial Complaint against Mayfair advancing the four claims described at the outset of this opinion. After discovery TSR filed an Amended Complaint on December 19, 1991. Only the Fourth Count is at issue on the current cross- motions, which dispute whether various Mayfair products violate the terms of the Agreement (P. 12(m) PP 40-106). Breach of the Agreement TSR's allegations of breach of the Agreement by various Mayfair products fall into three categories: (1) packaging and promotional materials for the "City State of the Invincible overlord" product, (2) "Role Aids" promotional materials and (3) advertising materials for the "Freedom of Choice" campaign. This opinion addresses each in.turn. City State of the Invincible overlord In July 1987 Mayfair acquired the rights in, and began to produce and market, a new role-playing game called "City-State of the Invincible overlord" (the "Invincible Overlord" game)(P-D P 41). On July 9 Mayfair and Gygax entered into a written agreement under which the Invincible Overlord box cover would state that it came "With an introduction by E. Gary Gygax, creator of Advanced Dungeons & Dragons" ("Gygax statement")(D-P P 122). TSR's trademark was not placed within the cartouche as specified in the Agreement, and no disclaimer of TSR's approval of the use of the AD & D trademark was visible (P-D P 44). Mayfair used the Gygax statement in the text of a flyer promoting Invincible overlord, and it used the AD & D trademark again at the bottom of the flyer to identify AD & D as a registered trademark of TSR (P-D P 47). Mayfair also used the AD & D trademark in various promotional materials that depicted the Invincible Overlord box cover or described Invincible Overlord as compatible with AD & D, without an accompanying disclaimer of TSR's approval of the use of its trademark (P-D PP 50, 52, 54, 56). [FN7] *3 TSR asserts that all uses of the AD & D trademark in connection with the Invincible overlord game violate the Agreement. Mayfair admits that the use of the AD & D trademark in the 1990 Mayfair Trade Catalog violated the Agreement (D. 12(n) P 51), but it denies that the other uses violate the Agreement (D. 12(n) PP 46, 48, 53, 55). A. Gygax Statement Mayfair's use of the AD & D trademark within the Gygax statement in conjunction with Invincible Overlord and related advertisements contravenes the plain language of the Agreement, which states in part (P. Ex. 1 P I): Mayfair agrees that except as otherwise provided herein, any use of TSR's Advanced Dungeons & Dragons trademark shall be limited to use within a specified Trademark Statement, solely in connection with "Role Aids" modules, and advertising and promotional materials therefor, and strictly in compliance with the Trademark Use Requirements as set forth in Exhibit B attached hereto and incorporated herein by reference. Invincible Overlord is not of course a Role Aids product. Even though the Agreement later went on (P. Ex. 1 P V) to carve out a total exception for rights acquired from Gygax, that exception was limited to rights in the D & D trademark, and the AD & D trademark did not appear in the oval emblem form. Mayfair's Mem. 5 argues that it used the Gygax statement based on his representation that under his confidential termination of employment agreement with TSR he had the right to allow Mayfair to use the statement. However, Mayfair's belief in that respect could not of course justify a patent breach of the Agreement's limitations. [FN8] But Mayfair also contends that TSR's acceptance of several ads for Invincible Overlord that showed the Gygax statement operate as a waiver of TSR's claim of a material breach (D. Mem. 10). TSR's own Dragon Magazine published three Mayfair ads for Invincible overlord in March 1988, April 1989 and February 1990 (D-P P 124). TSR claims that portions of the ads with the Gygax statement were not visible in the ads (P. 12(n) P 124). While TSR admits that a lawyer reviews "certain advertisements" for possible misuse of trademarks, TSR's attorney was employed only for "some portions of the pertinent time period" (P. 12(n) P 123). Under Wisconsin law waiver requires proof of (1) a right possessed by the waiving party, (2) knowledge of the right by the waiving party and (3) an intentional and voluntary waiver (Shannon v. Shannon, 429 N.W.2d 525, 530 (Wis.App.1988)). Intent to waive a known right may be inferred from the conduct of the parties (Christensen v. Equity Coop. Livestock Sale Ass'n, 396 N.W.2d 762, 763 (Wis.1986)). Under a view of the facts in the light most favorable to Mayfair, TSR's knowing acceptance of the Invincible Overlord advertisements, which displayed a picture of the Invincible Overlord box cover with the Gygax statement, could be construed as a waiver of the materiality of any breach by Mayfair's packaging and advertising. Mayfair used the Gygax statement on the Invincible Overlord box cover (P. Ex. 12) and in the Invincible Overlord flyer (P. Ex. 13), the Invincible Overlord product description sheet (P. Ex. 14), the Mayfair reply card (P. Ex. 16) and the 1990 Mayfair trade catalog (P. Ex. 17). To the extent that TSR's motion for summary judgment charges Mayfair with breach of the Agreement by its use of the Gygax statement in Invincible Overlord advertising and packaging, the motion is therefore denied. *4 On the other side of the coin, Mayfair's motion for summary dismissal of that same charge on grounds of waiver by acceptance must be denied as well. By definition TSR could not waive any objection to use of the Gygax statement if it did not know or should not have known of that use (Shannon, 429 N.W.2d at 530). Although the visibility of the Gygax statement varies within the ads, in all three of the ads the box cover print is greatly reduced, so that the statement is not as readily noticed as it would be on the full-sized box cover. TSR also asserts that "the legal department at TSR had an attorney employee for only some portions of the pertinent time period" (P. 12(n) P 123). But the statement that TSR cites for that statement (Moore Dep. 18-20) does not really support its proposition. [FN9] Nevertheless it remains possible that the.TSR attorney reviewers, if any, may not have noticed the Gygax statement in the Invincible Overlord ads. [FN10] Mayfair's Mem. 10 also contends that TSR's failure to object to the use of the AD & D trademark before filing the motion for summary judgment operates as a waiver on delay grounds. Although Mayfair has not labeled (nor argued) the contention in this fashion, this Court views the argument--waiver due to the passage of time--as one for the application of laches. Wisconsin law requires four elements for laches to apply: (1) unreasonable delay, (2) knowledge of the basis of the claim and failure to act on the part of the plaintiff, (3) lack of knowledge on the part of the party asserting the defense that the other party would assert the right on which he bases his suit and (4) prejudice to the party asserting the defense in the event the action is maintained (Jensen v. Janesville Sand & Gravel Co., 415 N.W.2d 559, 562 (Wis.App.1987)). Again on a pro-Mayfair look at the facts, TSR knew of the Invincible Overlord ad by March 1988 but did not raise any objection until it filed its summary judgment motion on June 17, 1992. [FN11] That four-year lapse before objection may well be unreasonable (see Money Store v. Harriscorp Finance, Inc., 689 F.2d 666, 674 (7th Cir.1982), upholding the district court's determination that a 22-month delay was unreasonable). [FN12] Such an unreasonable delay in trademark actions precludes recovery of damages or wrongfully derived profits during the period before suit was filed (James Burrough Ltd. v. Sign of the Beefeater, Inc, 572 F.2d 574, 578 (7th Cir.1978)). Although injunctive relief and damages and profits for the period after the filing of suit may not be precluded (id., citing McLean v. Fleming, 96 U.S. 245 (1877)), Mayfair has said it ceased distribution of Invincible Overlord in June 1992 (Bromley Aff. P 12). If so, and if Mayfair can make the appropriate showing of prejudice due to TSR's delay, the laches defense would in effect be a complete bar to relief on the issue of breach by the Invincible Overlord product. To take the opposite view as was done with Mayfair's estoppel defense, the defense of laches requires knowledge (or at least constructive knowledge) on TSR's part. Because this opinion must assume lack of knowledge by TSR in considering Mayfair's motion to dismiss, [FN13] laches cannot now provide grounds to grant Mayfair's motion. B. Compatibility with AD & D *5 TSR also alleges breach of the Agreement by two Invincible Overlord materials that state that the series is compatible with AD & D. Mayfair has admitted that the Mayfair 1990 trade catalog, which stated that "The Invincible overlord series is compatible with the Advanced Dungeons & Dragons role- playing game" (with the only disclaimer statement being placed in a footnote ten pages later) violated the Agreement. Because Mayfair has also made no defense of waiver as to that catalog (see D. Mem. 10), TSR's motion for summary judgment is granted to the extent that it is based on breach of the Agreement by the 1990 Mayfair trade catalog. TSR has also alleged violation by writers' guidelines that Mayfair distributed to authors and potential authors of its publications. Those guidelines stated that "The Overlord and Role Aids product lines are designed for use with TSR's Advanced Dungeons & Dragons TM system" (P. 12(m) P 53, P. Ex. 11)). Mayfair denies violation, but without any attempt at providing an explanation or evidence (D. 12(n) P 53). Accordingly breach of the Agreement by the writers' guidelines is deemed admitted, and summary judgment is granted to that extent as well. Role Aids Promotional Materials In 1988 or 1989 Mayfair began a marketing drive for the Role Aids product line, and in 1990 it introduced the new Role Aids modules "Witches," "Psionics" and "Lizardmen" (P-D P 57). TSR claims that the advertising materials for the Role Aids products (reply cards, trade and consumer catalogs, posters, flyers, slick sheets, press releases, product description sheets and Mayfair Games News letters) violated the terms of the Agreement (P. 12(m) PP 57-93). A. Violations Admitted by Mayfair Mayfair acknowledges many of TSR/s assertions. It admits that its reply card (P. Ex. 16, D. 12(n) P 59), its 1990 summer catalog (P. Ex. 18, D. 12(n) P 63), a flyer for the "Witches" module (P. Ex. 21, D. 12(n) P 65), the Role Aids Slick sheets (P. Ex. 22, D. 12(n) P 68), an advertisement for "Psionics" (P. Ex. 20, D. 12(n) P 70), its 1990 and 1991 trade catalogs (P. Exs. 17, 19, D. 12(n) PP 72, 74), the July 1990 and June 1992 Mayfair Games News letters (P. Exs. 25, 27, D. 12(n) PP 79, 81) and several Role Aids product description sheets (P. Ex. 28-1 to -4, and -6 to -15, D. 12(n) PP 84, 86, 88) all violated the Agreement. Mayfair also admits that the "People, Places & Things" sourcebook and "Demons" module product description sheets violate the Agreement (P. Exs. 29-1 and -2, D. 12(n) PP 99, 100). Mayfair makes three arguments as to those admitted violations by the Role Aids promotional materials: (1) TSR has waived its right to object because Mayfair gave TSR copies of the Role Aids promotional materials violating the Agreement at game conventions between 1988 and 1991, but TSR did not alert Mayfair to the violations until the Amended Complaint was filed in December 1991, (2) the breaches were not material and (3) the violations caused no injury to TSR. Those arguments are addressed in turn. 1. Waiver As already indicated, Mayfair says that it provided TSR representatives with copies of the Role Aids promotional materials from 1988 to 1991 (D. Mem. 11; Bromley Aff. P 19). Because TSR assertedly did not notify Mayfair of the violations until the December 1991 filing of the Amended Complaint, Mayfair urges that TSR has waived its right to object to the violations (D. Mem. 11). Again this will be treated as an argument for the application of laches. *6 TSR admits that "Darwin Bromley and perhaps other representatives of Mayfair have passed out some catalogs and promotional materials to some representatives of TSR for general promotional purposes" (P. 12(n) P 135). However, TSR Mem. 6 argues that it did not knowingly relinquish its right to object to the Role Aids promotional materials. TSR asserts that the promotional materials were distributed primarily during 1990 through 1992, that TSR filed its initial Complaint here on January 22, 1991 and that many Mayfair documents were not produced until Bromley's deposition was taken on October 1 and 2, 1991, after which TSR filed its Amended Complaint expanding the Fourth Count on December 16, 1991 (P. R. Mem. 5, Bromley Dep. 81). Only one of the materials that Mayfair acknowledges as violations is dated in 1988, with the rest dated in 1990, 1991 or 1992. [FN14] measured back from the filing of the Amended Complaint, the earliest of the undated 1990 materials could not have been as much as 24 months old before TSR lodged its objections. Case law in this circuit has noted "that two years has rarely, if ever, been held to be a delay of sufficient length to establish laches" (Piper Aircraft Corp. v. Wag-Aero, Inc., 741 F.2d 925, 933 (7th Cir.1984)). Even if TSR knew of each offending Mayfair item at the time of issue (an unlikely situation, and certainly not established on the current record), Mayfair would have a potential laches defense only as to a single product description sheet dated in 1988. And TSR's failure to object to a single isolated item cannot form the basis for a laches defense. Thus Mayfair's motion to dismiss the breach of contract claim on the basis of laches must be denied. TSR's statement that it had only limited knowledge of the offending materials before filing its December 1991 Amended Complaint is enough to negate the required element of knowledge of facts sufficient to raise a claim for breach. In fact, Mayfair may have contributed to TSR's delay by its own delays in responding to discovery requests. 2. Lack of Materiality Mayfair Mem. 11 advances a lack of materiality defense in one nonstop sentence: [T]he promotional materials showed that they were from Mayfair and the Role Aids modules themselves, without exception, contained the Trademark Statement in strict compliance with the Settlement Agreement on their front covers so as to put the consumer clearly on notice as to the disclaimer sentences which, in fact, have little impact on the consumer and are not even read by the typical consumer who, in making a purchase decision, does not care which particular company produced the role-playing product. That argument might have had force in the absence of the Agreement--but once the parties had entered into the Agreement, such a contention comes too late. Agreement Ex. B P 5 requires, not only as to the Role Aids modules but also as to all promotional materials except for sales training literature, correspondence and press releases, that Mayfair use the AD & D trademark only in the form of the cartouche with the disclaimer statement. In the Agreement itself Mayfair "acknowledge[d] that its failure to remedy [a] violation in accordance with the foregoing may result in immediate and irreparable damage to TSR" (P. Ex. 1 P VI). Mayfair has admitted that it has disseminated materials using the AD & D trademark outside of the cartouche form and without the disclaimer statement, but also says that it has not attempted to recover the violating Role Aids advertising and marketing materials. *7 In short, this branch of Mayfair's argument would effectively render the Agreement a nullity by making a violation of its key terms nonactionable. That contention too is rejected. 3. Lack of Injury Mayfair finally contends that even if it violated the Agreement, its actions caused no injury to TSR. Walgreen Co. v. Sara Creek Property Co., 775 F.Supp. 1192, 1195 (E.D. Wis.1991) teaches that Wisconsin follows universal doctrine in that respect: Under Wisconsin law, a plaintiff claiming breach of contract has the burden of proving by a preponderance of the evidence that ... the defendant's breach is material and results or will result in injury. Mayfair says that its use of TSR's trademarks caused no customer confusion. To that end it presents the deposition of Stephen Winter, AD & D product group leader and game editor at TSR, in which he testified that he was aware of no customer confusion of Mayfair for TSR products since the Agreement (Winter Dep. 43) and that consumers do not refer to "Advanced Dungeons and Dragons" as a generic designation for role-playing game systems (id. at 37-38). [FN15] Moreover, Mayfair Mem. 12-13 states, the Trademark Statement was an the cover of every Role Aids module, the Role Aids logo was more prominent on the front cover than the AD & D logo and every Role Aids module and piece of promotional material indicated that it came from Mayfair. On the other hand, TSR says that confusion is "inevitable," and it represents (though not in evidentiary form) that retailers in London had "intermix[ed]" TSR and Mayfair products (P. R. Mem. 9 & n. 3). For aught that appears, this may indeed be a case of minimal damage to TSR. So far as the ultimate consumer is concerned, Mayfair's compliance with the Agreement on all Role Aids modules negates any potential damage--for having bargained for the precise form of disclaimer that it wanted, TSR will not be heard to say that it has been hurt when that disclaimer has been adhered to. As for the sales market in which TSR and Mayfair compete, whether wholesalers or retailers, there has been no showing of lost sales or damage to the value of TSR's trademarks because of Mayfair's violations of the Agreement in promotional materials. That subject remains for future determination. [FN16] And as stated later, the record here does not support TSR's claim for rescission of the Agreement. Accordingly the appropriate action at this point is simply to declare the existence of the breaches that have been admitted by Mayfair. To that extent TSR is entitled to a judgment as a matter of law, with the decision as to the extent of any damages remedy to await further proceedings. B. Violations Denied by Mayfair 1. Demons TSR contends and Mayfair denies that the cover of its new "Demons" module violates the Agreement (P-D P 108). [FN17] According to TSR, Mayfair has failed to comply with the contractual requirement that the Mayfair trademark be visually more prominent than the AD & D trademark--a requirement buttressed by express standards. TSR's Supp. Mem. 2 argues that in violation of those standards the Role Aids logo is "almost invisible" in the upper corner of Demons, in gold lettering on a red background. Mayfair admits that "[t]he degree of contrast of the Role Aids logo on Mayfair's Demons product cover ... is substantially less than it was on the final proof submitted by the printer and approved by Mayfair" (Bromley Aff. P 37). Even so, Mayfair urges that the Role Aids logo is nonetheless visible, that the second page of Demons makes clear that it is a Mayfair product and that "future production runs of Demons will have the Role Aids logo in white on a red background" (D. 12(m) P 149, Bromley Aff. P 37, D. Ex. 7). *8 There is no ambiguity in the Agreement, which requires that "the ROLE AIDS trademark [be] on a color background with no less contrast than the contrast of the ADVANCED DUNGEONS & DRAGONS trademark to its background" (P. Ex. 1 P I and Ex. B P 1). Although the Role Aids logo was not visible at all in the photocopy of the Demons cover originally submitted to this Court, it is certainly legible on the Demons module itself. But the Role Aids logo is a dull gold printed on a red background, while the AD & D logo is in white on a red background. Mayfair's printer woes and future intentions notwithstanding, the cover of the present Demons module clearly does not comply with the terms of the Agreement. It too constitutes a contractual breach. 2. Quote from Dragon Magazine Review TSR also asserts that Mayfair's 1990 and 1991 trade catalogs and the Undead product description sheet (P. Ex. 17 at 25, P. Ex. 19 at 11, P. Ex. 28-5) violate the Agreement by using this quote from a review of Undead in Dragon Magazine (P-D P 75): This is a quality AD & D game campaign supplement. The setting is imaginative and fantastic; the dead guys are grim and menacing; there are plenty of neat new magic and monsters. [FN18] Mayfair denies that its use of the AD & D trademark in the context of quoting from Dragon Magazine amounts to a violation of the Agreement (D. 12(n) P 76). Agreement P V provides in part: Except for use of TSR's Advanced Dungeons & Dragons trademark in accordance with this Agreement, Mayfair hereby agrees to cease and desist throughout the world from use of TSR's Advanced Dungeons & Dragons trademark or any mark confusingly similar thereto, in connection with any products or advertising or any other materials. If the quoted review had originated with Mayfair, there could be no disputing that it violated that restriction. Mayfair would have it that the answer should be different because the reviewer and not Mayfair made the decision to describe Undead as an "AD & D game campaign supplement" (D. 12(n) P 76, Bromley Aff. P 36). But no use by others of the AD & D trademark in connection with Role Aids products can clear the way for Mayfair to do the same. After all, Mayfair has curtailed its own use of the AD & D trademark in the Agreement. It may not avoid those restrictions by copying the usage of someone who was not so inhibited, the Dragon Magazine reviewer. Once again Mayfair points out that TSR did not complain to Mayfair until it filed the present motion. Mayfair had included the Dragon Magazine quote in its 1990 and 1991 catalogs, several years after issuing the product description sheet on October 20, 1986. Though Mayfair has not contended that it supplied TSR with a copy of that earlier document, it says that it gave TSR copies of the Mayfair Games catalog at trade conventions (D 12(m) P 35). But as already stated, even if TSR became aware of the violation in the 1990 catalog, [FN19] its failure to object before it filed the Amended Complaint in December 1991 is not so unreasonable as to bar its current claim. [FN20] 3. "Suitable for Use with Any Fantasy Campaign" *9 According to TSR, the To Hell & Back Again product description sheet (P. Ex. 29-3) also violates the Agreement because it 'says that the product "has numerous locations that can be worked into any fantasy campaign" (P. 12(m) P 100). Mayfair disputes that, because the relevant provision of the Agreement prevents Mayfair only from describing Role Aids as "suitable for other role- playing games" (P. Ex. 1 P I and Ex. B P 6). For that purpose "role-playing game" is defined as (id.): a structured form of social entertainment comprising a quantified interactive story telling game that allows the participants, within their imagination, and subject to the limitations of the game's rules, to adventure forward, attempting to satisfy their personal ambitions or fantasies through the use of the characteristics, perceptions and abilities of an imaginery [sic] character or person. Mayfair Mem. 6-7 urges a difference between a role-playing game and a fantasy campaign (D. 12(n) P 101, Bromley Aff. P 18, Winter Dep. 82, Santana Aff. P 4). According to Mayfair Mem. 6, "there are multiple fantasy campaigns in Advanced Dungeons and Dragons." Winter Dep. 82 describes a fantasy campaign as "the series of adventures that's being conducted by a particular game referee or with a particular group of players with a rotating referee's position." Although TSR seeks to deny Mayfair's assertion that the use of the term "fantasy campaign" does not violate the Agreement (P. 12(m) P 130), it does admit that "[a] fantasy campaign is different from a fantasy role-playing game" (P. 12(m) P 131). It really has advanced neither argument nor evidence to counter Mayfair's position that the use of the term "fantasy campaign" is a nonviolation. TSR's Mem. 29-31 explains that its purpose in preventing Mayfair from stating that Role Aids were suitable for use with other role-playing games as well as AD & D was to protect TSR's trademark from becoming generic. Sounding another variation on the same theme, TSR's R. Mem. 9 asserts that "Mayfair's advertising campaign promoting ROLE AIDS modules as suitable 'for any fantasy role-playing game on the market' harms the reputation and goodwill of the ADVANCED DUNGEONS & DRAGONS mark as representing a unique brand of products." That is really nonsense. As Mayfair's Mem. 11 asks rhetorically: If the producer of Gatorade claims its drink is great for football players and also claims it is great for participants in any high-energy sport, is it reasonable to argue that football is at risk of becoming generic for high- energy sports as a result thereof? Indeed, the restriction that TSR incorrectly contends was violated in the respect now under discussion [FN21] is the one aspect of the Agreement that appears to find no legitimate justification in TSR's trademark rights. It seems to be purely anticompetitive and hence likely unenforceable as an unlawful extension of the trademarks. *10 For present purposes, though, that issue need not be decided. It is enough to find (as this Court has) that TSR loses as a matter of contract. Mayfair is entitled to dismissal of the claim that the Agreement was breached by the To Hell and Back Again product description sheet. C. Freedom of Choice Campaign In late 1991 Mayfair began the "Freedom of Choice" advertising campaign (D. 12(m), P. 12(n) P 127). Mayfair has admitted that its Freedom of Choice Poster that stated Role Aids products "were for use with any role-playing game" violated the terms of the Agreement (P. Ex. 31, D. 12(n) P 96). But its Mem. 6 says that once it realized that in April 1992, it promptly terminated the use of promotional materials having the non- complying language (Santana Aff. P 4). Mayfair presents no evidence that it then attempted to recall the Freedom of Choice materials, but its Mem. 7 states that such attempts are futile (Bromley Aff. P 34, Santana Aff. P 6). TSR denies that Mayfair made good faith efforts to retrieve noncomplying materials (P. 12(n) PP 130, 150), pointing out that Bromley based his conclusion of the futility of recall attempts merely on the attempted recall of one shipment of Psionics (Bromley Aff. P 34). In fact, Mayfair's Jennifer Santana testified that Mayfair made no attempts at recall of the Freedom of Choice materials (Santana Aff. P 6). It does not necessarily follow from the futility of Mayfair's attempts to recall the Psionics modules that had been sent to stores that Mayfair would have been equally unsuccessful in.recalling advertising materials. After all, stores may be willing to comply with a request to refrain from posting an advertisement or to replace the advertisement with another, but may be reluctant to send back what they believe will be a popular product. Mayfair's Mem. 10 also contends that its acknowledged breach of the Agreement by the Freedom of Choice campaign literature is not material because "the trade was correctly describing Role Aids as being usable in any fantasy role-playing game for a long time prior thereto" (D. 12(m) P 128). TSR denies that, but its denial hardly seems in good faith in light of TSR's own Ex. 33, a collection of catalog pages listing Mayfair Role Aids products. Capital City's Game Buyer's Monthly for July 1990 and its March 1991 releases describe Mayfair's "Witches" and "Lizardmen" modules as suitable for "any fantasy roleplaying adventure or campaign" and "for use with any fantasy RPG" (P. Exs. 33-1 and - 2); Capital City"s "The Premium Specialty Collection" May, October and December 1990 issues describe Role Aids products as "generic" (P. Exs. 33-19, -20, -21); Wargames West's 1991 Spring catalog states that Role Aids modules "can be used with any fantasy role-playing system, especially TSR's Dungeons & Dragons and AD & D systems" (P. Ex. 33-25). Several of the pages in P. Ex. 33 list Role Aids modules under the category "Generic Fantasy Source Books and Modules" (P. Exs. 33-3 through 33-13, 33-22 and 33-23) and describe Lizardmen and Psionics as "universal," "for use with any RPG" or "designed to adapt to any fantasy roleplaying game system" (P. Ex. 33-14 through 33-16, 33-24), but no date of publication is shown on those exhibits. *11 Mayfair has presented Bromley's affidavit testimony that the only catalogs in P. Ex. 33 that did not precede the Freedom of Choice campaign are P. Ex. 33-17 and 33-18 (Bromley Aff. P 14). Although the last page of Exhibit 33 (left unnumbered by TSR) from the 1991-92 Winter/Spring Wargames West Catalog may have come out after the Freedom of Choice campaign, TSR has made no effort to provide the date of those materials. However, given the substantial number of dated exhibits that describe Role Aids modules generically, the undated exhibits provide only cumulative information. To be sure, the fact that others describe Role Aids in a manner that Mayfair agreed not to use does not release Mayfair from its promise. But as.has already been indicated in the discussion about the To Hell & Back Again product description sheet, there is more than a serious question whether that promise is valid and enforceable. Indeed, the usages by others that comprise the various subparts of P. Ex. 33 graphically illustrate the total lack of connection between a statement that Role Aids has multiple uses and any conclusion that one of those uses--that in conjunction with AD & D--somehow renders AD & D generic. Again this Court would be strongly inclined to consider invalidating that component of the Agreement. But once again it is unnecessary to take that step, for at worst this claimed violation of the Agreement is both de minimis and in the past. It has potential relevance only on the issue of the relief to which TSR may be entitled. Remedies This opinion has earlier referred to the bifurcation of issues that has deferred the question of damages sustained by TSR as the result of Mayfair's several violations of the Agreement. Consequently all that now remains for consideration is whether TSR's prayer for rescission of the Agreement should be granted or denied. Not surprisingly, Wisconsin law adheres to universal equitable principles in defining the conditions that entitle a party to rescission of a contract for its breach. Any party who would rescind a contract must do so within a reasonable time following its discovery of the breach (Thompson v. Village of Hales Corners, 340 N.W.2d 704, 718 (Wis.1983)(six-month delay in asserting rights bars rescission)). Rescission is not the appropriate remedy for every breach of contract--rather "the nonperformance must be substantial and the breach so serious as to destroy the essential objects of the contract" (Seidling v. Unichem, Inc., 191 N.W.2d 205, 207 (Wis.1971)). And rescission must "restore the parties to the position they would have occupied if no contract had ever been made between them": Each party must return to the other all benefits received under the contract (id. at 208; First Nat'l Bank & Trust Co. v. Notte, 293 N.W.2d 530, 539 (Wis.1980)). Merely to state those basic principles is to demonstrate why rescission is inappropriate here., Whether or not TSR acted with sufficient promptness after it learned of Mayfair's breaches, [FN22] the parties' many years of performance under the contract obviously render its unwinding far more difficult and less appropriate (a point elaborated on in a moment). Next, it can hardly be said that the breaches identified here have "destroy[ed] the essence of the contract"--it will be remembered that the presentation of Mayfair's Role Aids products to the ultimate consumer has always (with one minor and inadvertent exception) adhered to the standards that TSR itself established to assure that Mayfair would not poach on its preserves (a point also elaborated on in a moment or two). *12 Perhaps most importantly, there is no way in which the parties can effectively be restored to the status quo ante contract--no way in which the omelet can be unscrambled and put back into the egg. It is truly an impossibility, given the time span from 1984 to the present during which the parties have functioned under their contract, to "restore the parties to the position they would have occupied if no contract had been made between them." In terms of the restoration of benefits, just how can TSR repay whatever benefit it has derived from the ongoing Role Aids advertising of AD & D as the only role-playing game expressly mentioned on Mayfair's products, or it has derived from the continued reinforcement of the AD & D trademarks over the intervening years without any attack by Mayfair? In sum, this case does not at all call for TSR to obtain the equitable benefit of contract rescission, beyond whatever damages (not yet established) that it is able to demonstrate flowing from the breaches shown here. For over eight years it has derived the principal benefits that it bargained for in the Agreement: 1. To the consuming public, Mayfair has meticulously observed the requirements marked out by TSR--standards that make plain its nonsponsorship of Mayfair's competing Role Aids modules, while at the same time keeping the AD & D name before the consumers, with TSR identified as its source. [FN23] 2. TSR's trademarks have remained without challenge from Mayfair, promoting the continued entrenchment of D & D and AD & D as fixtures in the consuming public's minds. As against that, TSR has shown a number of contract breaches by Mayfair--but not such as to demand rescission. In some instances Mayfair has cured the problems on its own, or (as in the Demons situation) has promptly stated its intention to correct the inadvertent error. In one instance it terminated the employee responsible for misreading the Agreement's directives. And there is no reason to believe that it will not promptly correct the remaining breaches that have been found here. Moreover, this opinion has twice commented on the apparent overreaching by TSR in one part of the Agreement: prohibiting Mayfair's truthful advertising of the fact that Role Aids products may be utilized by members of the consuming public in conjunction with rival role-playing games as well as with AD & D. That restraint inhibits not only Mayfair's market among consumers who have purchased (or might intend to purchase) role-playing games from TSR's competitors but (not incidentally) also tends to lessen the demand for those competitive games among purchasers of Mayfair's Role Aids products. And again those anti-competitive measures appear to find no rational support in TSR's legitimate goals for protecting the integrity of its own trademarks. [FN24] Whether or not those considerations invalidate that particular restraint of trade has not been decided here, because it need not be. But those considerations do tend to place in sharper focus the effect of a rescission of the Agreement here. Because of AD & D's prominence in the marketplace, any revocation of Mayfair's permission to refer to AD & D with appropriate disclaimers could bid fair to destroy Role Aids as a competitor for the marketplace with TSR's own products intended for use in that role-playing game. [FN25] What is.reflected in the total record here simply does not support this Court's throwing its weight into the competitive scales in that fashion, when TSR has a fully adequate remedy in the form of its recouping any damages that it can prove and its obtaining an injunction compelling Mayfair's correction of past violations and preventing new violations. [FN26] Conclusion *13 TSR's motion is granted to the extent that this Court finds the following materials to have violated the Agreement: the 1990 Mayfair Trade Catalog with the Invincible overlord compatibility statement, the Invincible overlord writers' guidelines, all the challenged Role Aids materials except for the To Hell & Back Again product description sheet and the Freedom of Choice materials. TSR's motion is denied as to Mayfair's use of the Gygax statement on the Invincible Overlord materials. Mayfair's motion is also denied as to that use of the Gygax statement, while its motion is granted as to the To Hell & Back Again product description sheet. As to remedies for the adjudicated violations, TSR's prayer for rescission of the Agreement is denied, and the scope of appropriate relief is deferred pending further submissions by the parties. FN1. According to TSR's Mem. 1 n.1, its success on that claim "would subsume the relief it seeks for trademark infringement." And because Mayfair is not now distributing the book that gave rise to TSR's copyright infringement claim, "the crux of the current dispute would be decided" (id.). FN2. Because Mayfair's Statement of Additional Facts was appended to its GR 12(m) statement, the D. 12(m) and P. 12(n) numbering began where the P. 12(m) and D. 12(n) numbering left off. FN3. Trademarks involved include "Advanced Dungeons and Dragons," "AD & D," "Dungeons and Dragons" and "D & D." For brevity's sake, this opinion refers to each set of trademarks by employing only the abbreviated version. But where either set of initials is used in the singular, it will stand for the full- length mark ("Dungeons and Dragons" or "Advance Dungeons and Dragons") unless otherwise specified. FN4. Mayfair's responsive statements have devoted a substantial amount of rhetoric to disputing the characterization of Advanced Dungeons and Dragons and Dungeons and Dragons as "games," contending in part that TSR does not "own" either of them (see D. 12(n) PP 7-10, 12, 14, 15, 17, 23). For those propositions Mayfair cites to Bromley's Aff. P 3: A role-playing game is quantified, interactive storytelling, in accordance with a series of rules and algorithms which define how the players interact with one another and the game master. A role-playing game is intangible, does not have a brand or trademark and is not itself sold or owned. Books and reference information may be used but are not essential for a role- playing game. Interestingly, Mayfair does not dispute TSR's contention that Mayfair "produces its own role-playing games" (P-D P 22). Moreover, Mayfair is not consistent in its own semantic insistence. It states at D. Mem. 10 that "Advanced Dungeons and Dragons is different from other role-playing games because it is based on different rules." As TSR has pointed out, the only function of Mayfair's contentions seems to be an end run around the Agreement's ban on its contesting the validity of the AD & D trademarks. FN5. David Arneson ("Arneson") was co-creator of Dungeons and Dragons. FN6. Although the Agreement characterized that form as an "oval," its physical depiction in P. Ex. 1 Ex. B is that of an oblong cartouche drawn to appear three-dimensional. It seems that the parties are better developers of games than they are lexicographers. This opinion will use "cartouche" rather than "oval" to refer to the emblem. FN7. Mayfair's 1990 Trade Catalog did contain a footnote marker after the AD & D trademark. Ten pages later "in small print at the bottom of the page" was a disclaimer of TSR"s approval of Mayfair's use of its trademark (P-D P 50). TSR also points out, without alleging violation of the Agreement, that both the 1990 Mayfair catalog and the Mayfair customer reply card (P. Ex. 16) identified Invincible Overlord as adaptable for use with any fantasy role-playing system (P. 12(m) PP 50, 56). Although Agreement Ex. B P 6 prohibited Role Aids modules that utilized the trademark statement from also including statements that such modules are suitable for use with other role-playing games, TSR has not attempted to argue that use of the AD & D trademark on a non-Role Aids product is governed by a similar restriction. FN8. One issue that TSR has steered clear of is how, given the standards of trademark law as to likelihood of confusion and confusing similarity, it could create an unlimited exception to the Agreement's restrictions on Mayfair to allow Mayfair to deal with Gygax for use of the D & D trademarks, and yet cavil at Mayfair's acquisition of rights that Gygax apparently had in the AD & D trademarks. Before TSR will be heard to make anything out of that aspect of Mayfair's claimed breaches (an issue deferred by the summary judgment context of this opinion), it has some more explaining to do. FN9. Moore testified that the legal department reviewed ads before placement for misuse of TSR's trademarks (Moore Dep. 18- 19). Moore also testified that when he took the editorship of Dragon Magazine in 1986, policies for review of ads may have been "in flux" and he was "not sure at what point they settled out" (id. at 19). FN10. What has just been said in the text truly gives TSR the benefit of the most favorable reasonable inferences. Even though waiver law speaks of a party's knowledge, the concept would seem to extend to charged knowledge as well--to prevent a party from playing ostrich. Indeed, Shannon, 429 N.W.2d at 530 speaks of what the party knew or should have known. Thus final resolution of the issue will require examination of whether TSR should have known of the Invincible Overlord ads' contents, given its keen awareness of the importance of its trademark rights and of the nature of the role-playing game industry. FN11. Neither TSR's original Complaint nor its Amended Complaint had mentioned Invincible Overlord. FN12. Although the analogous statute of limitations for breach of contract has yet to run in this case, Wisconsin law allows application of a laches defense within the limitations period (Schafer v. Wegner, 254 N.W.2d 193, 196-97 (Wis.1977)). FN13. But see n.10. FN14. TSR could not have known of many of the Role Aids items until 1990 at the earliest. That was the year in which Mayfair introduced the Witches, Psionics and Lizardmen modules. Those promotional materials would include an advertisement for "Psionics" (P. Ex. 20, D. 12(n) P 70) a flyer for the Witches module (P. Ex. 21, D. 12(n) P 65), a product description sheet for Witches (P. Ex. 28-1), the 1990 summer catalog (P. Ex. 18, D. 12(n) P 63), the 1990 and 1991 trade catalogs (P. Exs. 17, 19, D. 12(n) PP 72, 74), and the July 1990 and June 1992 Mayfair Games News letters (P. Exs. 25, 27, D. 12(n) PP 79, 81). In addition, the product description sheets for People, Places and Things and Demons (P. Ex. 29-1 and -2) were for products to be introduced in 1992 (P-D P 98). One product description sheet (P. Ex. 28-2) is dated in 1988, while the rest are dated from 1983 to 1986 (P. Exs. 28-5 to 28-15). Some materials are undated: Mayfair's reply card (P. Ex. 16), Role Aids slick sheets (P. Ex. 22) and two Role Aids product description sheets (P. Exs. 28-3 and -4). FN15. Winter was, however, aware of media use of the trademark "Dungeons and Dragons" to describe role-playing games generically. Winter also testified that most customers would not read the disclaimer language, and that at least some consumers might think that a Role Aids product was licensed by TSR (Winter Dep. 50-51). FN16. This is not said to be critical. This Court earlier entered an order bifurcating liability from damages. FN17. TSR first saw the newly-developed Demons product at a trade show in late August 1992, after its summary judgment motion had been filed and briefing was under way (P-D P 107). TSR then obtained leave to file a supplemental memorandum in support of its motion, in which it addressed the latest of Mayfair's claimed violations of the Agreement. FN18. [Footnote by this Court] It may also be noted that the AD & D trademark in the Dragon Magazine quote in Mayfair's 1991 catalog is over twice as large as the print of the rest of the words in the sentence, and is also the largest descriptive print on the page except for the lettering on the photographs of the Role Aids modules. FN19. TSR's partial denial in its P. 12(n) P 135 is really ambiguous. That type of deliberate ambiguity will be construed against it, but it turns out to make no difference. FN20. Mayfair contends that TSR did not complain of Mayfair's use of the Dragon Magazine statement until the current motion for partial summary judgment was filed in June 1992 (D. 12(m) P 43). Although TSR denies that (P. 12(n) P 143), its citation to Williams Dep. 40-41 really does not support that position. That makes no difference, however, given the allegation in Amended Complaint P 57: Mayfair has breached the Limited Use terms of the Settlement Agreement by its use of the TSR Trademarks in ... connection with certain of the Role Aids publications and related materials. Under the Rules' notice pleading regime, that is enough--TSR was not required to plead its evidence. And Mayfair's use of the quote from Dragon Magazine in describing Undead, a Role Aids product, surely comes within the scope of the pleading's allegation. FN21. As indicated earlier, that contention is incorrect as a matter of contract construction: TSR has acknowledged that "fantasy campaign" is different from "fantasy role-playing game," so that a prohibition framed in terms of the latter is not violated by a statement that speaks in terms of the former. FN22. There is understandably a very different and much shorter yardstick for rescission purposes than for the application of laches. Laches actually defeats any claim of the aggrieved party, while the denial of the rescission remedy still preserves for that party the benefit of being made whole through the recovery of damages. In this case it would seem that TSR has failed to meet the timetable defined in Thompson as a precondition to rescission, but whether or not that is so, TSR fails on the other grounds discussed here. FN23. Although Demons has been a single exception to Mayfair's strict adherence to the Agreement's specifications for Role Aids modules, there is no reason to discredit Mayfair's explanation that the contrast between the Role Aids name and its background in the final product turned out to be less than the original printers' proofs had shown. It will be remembered that the Demons product came onto the market over 18 months after this lawsuit was brought, and after TSR had already launched its current motion. What incentive would Mayfair have, after eight years of living by the Agreement's standards in designing all of its other product modules, to depart from that practice deliberately in the face of this litigation and a Rule 56 motion? FN24. If anything, it would seem that measures that would thus tend to promote AD & D's market domination would make it more likely, rather than less likely, that AD & D might become a generic term among consumers. It is only necessary to recall such examples as Eastman's fight to prevent "Kodak" from entering the public domain, or Bayer's like fight as to "Aspirin" or GE's comparable fight as to "Frigidaire." FN25. Absent Mayfair's joinder in AD & D's prayer for rescission, it is assumed here that Mayfair is willing to continue to live with the specific ground rules set out in the Agreement, rather than having both parties relegated to the principles of law (such as fair use) that would apply in the absence of contract. FN26. It should be emphasized that this point is only an added fillip that demonstrates the soundness of denying TSR this specific equitable relief-- one to which it has not shown its entitlement based on the equitable principles that uniformly govern the availability of the rescission remedy. END OF DOCUMENT