By Emily Chasan

NEW YORK (Reuters) - A federal judge ruled on Wednesday that New York City has the right to use the name "Tavern on the Green" for its landmark Central Park restaurant, rejecting arguments by the restaurant's outgoing operators that they owned the name.

The decision paves the way for the city to reopen the restaurant under new management later this year.

Tavern on the Green, known for its sparkling chandeliers and painted murals, was a favorite place for tourists and celebrations of special occasions. It filed for bankruptcy protection on September 10, 2009, and ceased operations on December 31 after the LeRoy family, which had been operating the restaurant since 1976, lost a bid to renew its Tavern lease.

A legal fight quickly developed between the family and the city about who owned the rights to the restaurant's name and trademarks.

Another restaurateur, Dean Poll, who runs the Boathouse restaurant in Central Park, has been selected by the city to take over the restaurant, but contract negotiations for the 20-year license agreement to run it are still ongoing, said Cristina DeLuca, a New York City Department of Parks and Recreation spokeswoman.

New York City argued in the case that the legal name has been used on a restaurant in Central Park since 1934 and that it had the continuing right to use the name.

The LeRoys claimed they have owned the trademark, which they valued at $19 million, since 1978, when Warner LeRoy applied to register the name with the U.S. Patent & Trademark Office.

In a summary judgment in the case on Wednesday, U.S. District Judge Miriam Goldman Cedarbaum ruled in favor of the city.

"The city has the right under New York law to the trade name 'Tavern on the Green' for its historic restaurant in Central Park," Cedarbaum wrote in a 23-page opinion.

"The city chose the name and each concessionaire and made significant investments to ensure the success of the restaurant -- such that 'Tavern on the Green' was closely associated in the public mind with a building owned by the city and located in New York's Central Park," Cedarbaum said in her opinion.

Cedarbaum said that the LeRoys had obtained the trademark for the restaurant "through fraud" on the Patent & Trademark office, by not mentioning the city's claims to the name.

"This is a major victory for the City and all New Yorkers," the city's corporation counsel Michael Cardozo said in a statement. "We have ensured that the legacy of the long-treasured restaurant will be preserved for generations to come."

Judge Cedarbaum said it was premature to rule on whether the city or the LeRoys had the rights to the use of the moniker on cooking oils and salad dressings.

While there could be further litigation on the use of the name, it was unclear what the LeRoy family's response would be to the decision.

The company, whose bankruptcy case is set on Wednesday to be converted into a Chapter 7 bankruptcy from a Chapter 11 bankruptcy, will be liquidated by an as-yet-unnamed trustee for the benefit of creditors, said David Kane, an attorney for the LeRoys.

"The new trustee will be making all decisions going forward on the trademark and other assets of the debtor," Kane said.

The case is The City of New York v. Tavern on the Green LP, et al, U.S. District Court, Southern District of New York, No. 09-9224.

(Reporting by Emily Chasan; additional reporting by Basil Katz; editing by Gerald E. McCormick, Steve Orlofsky and Andre Grenon)