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Concordia Partners, LLC v. Pick

United States District Court, D. Maine

July 2, 2015

CONCORDIA PARTNERS, LLC, Plaintiff,
v.
MARCELLE PICK, et al., Defendants.

ORDER ON MOTIONS FOR PRELIMINARY INJUNCTION

GEORGE Z. SINGAL, District Judge.

Before the Court are Defendants' Motion for Preliminary Injunction Regarding Licensed Products (ECF No. 90) and Defendants' Motion for Preliminary Injunction Regarding Women to Women Mark (ECF No. 133). As briefly explained herein, both motions are DENIED.

I. STANDARD OF REVIEW

A moving party seeking preliminary injunctive relief under Federal Rule of Civil Procedure 65 bears the burden of persuading the Court that the party has: (1) a likelihood of success on the merits, (2) an irreparable injury in the absence of the requested injunctive relief, (3) that the injury outweighs any harm to the party who would be enjoined, and (4) that the injunction will not harm the public interest. See, e.g., Gonzalez-Droz v. Gonzalez-Colon, 573 F.3d 75, 79 (1st Cir. 2009). Of these four factors, the likelihood of success plays "a pivotal role." Largess v. Supreme Judicial Court, 373 F.3d 219, 224 (1st Cir. 2004); see also Jean v. Mass. State Police, 492 F.3d 24, 27 (1st Cir. 2007) (explaining that likelihood of success on the merits is considered the "most important part of the preliminary injunction assessment"). Likewise, "in most cases, irreparable harm constitutes a necessary threshold showing for an award of preliminary injunctive relief.'" Gonzalez-Droz v. Gonzalez-Colon, 573 F.3d 75, 79 (1st Cir. 2009) (quoting Charlesbank Equity Fund II v. Blinds To Go, Inc., 370 F.3d 151, 162 (1st Cir. 2004)). Ordinarily, "[e]conomic loss, on its own, is not an irreparable injury so long as the losses can be recovered." DISH Network Serv. L.L.C. v. Laducer, 725 F.3d 877, 882 (8th Cir. 2013). Any such showing of irreparable harm must be "grounded on something more than conjecture, surmise, or a party's unsubstantiated fears of what the future may have in store." Charlesbank Equity Fund II, 370 F.3d at 162. The requirements of likelihood of success and irreparable harm often operate on a sliding scale such that "when the likelihood of success on the merits is great, a movant can show somewhat less in the way of irreparable harm...." EEOC v. Astra USA, 94 F.3d 738, 743-744 (1st Cir.1996); see also Ty, Inc. v. Jones Group, Inc., 237 F.3d 891, 895 (7th Cir. 2001) (explaining that the preliminary injunction "process involves engaging in... the sliding scale approach; the more likely the plaintiff will succeed on the merits, the less the balance of irreparable harms need favor the plaintiff's position").

In considering all of four factors, the Court remains mindful that a preliminary injunction is "an extraordinary remedy never awarded as of right." Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 24 (2008). Rather, a district judge should exercise the authority to issue a preliminary injunction "sparingly." Mass. Coal. of Citizens with Disabilities v. Civil Def. Agency & Office of Emergency Preparedness of Com. of Mass., 649 F.2d 71, 76 n.7 (1st Cir.1981).

II. BACKGROUND[1]

Defendants Marcelle Pick and Pick Enterprises (together, "Pick" or "Defendants") have filed two motions seeking preliminary injunctive relief.[2] Both requests for preliminary injunctive relief arise out of the expiration of the parties October 21, 2006 License Agreement (ECF No. 118-1) (hereinafter "2006 License Agreement"), which was no longer in effect as of October 21, 2013.[3]

A. Licensed Products

The first motion, filed on January 5, 2015, asks the Court to restrain Plaintiff Concordia Partners, LLC ("Concordia") from selling any Licensed Products, as defined under the parties' now expired 2006 License Agreement. Pick alleges that Concordia has continued to market and sell Licensed Products in violation of the explicit terms of that Agreement. The License Agreement defines "Licensed Products" as follows:

The following comprise the Licensed Products in this Agreement:

a. Licensed Products as of the Date of this Agreement (also known as "Exhibit A Licensed Products"). These Products are shown in Exhibit A. These Products have been approved by the Owner as acceptable for marketing and sale under this Agreement, including their labeling and quality.
b. Product Line Extensions. These Products are shown in Exhibit B. These Products have been approved by both parties for product development, subject to Owner's rights of review and approval in this Agreement. While the timing and priority of development of each such Product is subject to agreement between the parties, it is their expectation to develop most or all of these Products during the Initial Term of this Agreement.
c. New Products. These Products are shown in Exhibit C. These Products will require substantial time and expense for development. While the timing and priority of development of each such Product is subject to agreement between the parties, it is their expectation to develop at least five of these Products during the Initial Term of this Agreement.
d. Third Way Products. From time to time and subject to the remainder of this Subsection d, Concordia, at [Pick]'s request, agrees to develop during the Initial Term and the first Renewal Period, two (2) Third Way Products. Third Way Product is defined as a product/service program that will require extraordinary time and expense for development that will be attributed to [Pick] and may be but is not required to be sold under the Trademark. The parties agree that Third Way Products should not be developed at the expense of Product Line Extensions or New Products. Provided development of the Product Line Extensions and New Products is proceeding on a timely basis, and [Pick] elects to invest the time required on her part to develop a Third Way Product, Concordia's development as referred to above shall be an investment of at least $25, 000 for the development, testing and marketing of each Third Way Product.

(2006 License Agreement at 26-27.) The 2006 License Agreement also contains explicit provisions for how to deal with any remaining inventory of Licensed Products after termination of the Agreement; specifically, Section 10 reads:

Post Termination Rights

A. Not less than thirty (30) days prior to the expiration of this Agreement or immediately upon termination thereof, Concordia shall provide Owner with a complete schedule of all inventory of Licensed Products then on-hand and for which there is an irrevocable purchase order (the "Inventory"). Concordia agrees to transmit, on a one-time basis and at the expense and request of Owner, a notice to persons who have ordered any Licensed Products within twelve (12) months of the termination of the Agreement. The notice shall provide the name, address, telephone number and email address of Owner.
B. Upon expiration or termination of this Agreement, except for reason of a breach of Concordia's duty to comply with the quality control requirements, Concordia shall be entitled, for an additional period of six (6) months and on a non-exclusive basis, to continue to sell such inventory. Such sales shall be made subject to all of the provisions of this Agreement and to an accounting for and the payment of the Royalty thereon quarterly as otherwise provided herein. Such final accounting and payment shall be due and paid within thirty (30) days after the close of the said six (6) month period.
C. Upon the expiration or termination of this Agreement, except as otherwise provided in this Agreement, all of the rights of Concordia under this Agreement shall forthwith terminate and immediately revert to Owner and Concordia shall immediately discontinue all use of the Trademark, Domain Name, 800 number for the Clinic, and the sale of all Licensed Products (except in connection with ...

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