By Nicholas Kaster, J.D.
The court issued its order with some reticence, stating that it was "questionable whether a preliminary injunction is in the public interest."
The federal district court in Philadelphia, Pennsylvania, has granted a preliminary injunction to prevent Russian and Czech entities—which hold trademark rights in the mark GRISHKO for ballet shoes everywhere in the world except for the United States—from infringing on the federally registered U.S. GRISHKO mark. The plaintiff, I.M. Wilson, demonstrated likelihood of success on the merits by demonstrating the validity and ownership of its marks. Furthermore, the court noted, where identical marks are used concurrently, the likelihood of confusion is inevitable (I.M. Wilson, Inc. v. Otvetstvennostyou "Grichko" , July 25, 2019, Pratter, G.).
The defendants in this case are Russian and Czech entities that manufacture and sell ballet shoes under the name GRISHKO. They own the trademark GRISHKO everywhere in the world, except for the United States. In this country, the plaintiff, l.M. Wilson, Inc., owns the GRISHKO trademarks for ballet shoes and has since the early 1990s. For decades, I.M. Wilson was the defendants' exclusive distributor in the United States and, until recently, the parties had an amicable working relationship. In 2016, the defendants terminated the exclusive licensing agreement under which the parties were operating, and the exclusivity of the relationship officially came to an end in March 2018. Around that time, the defendants began selling products directly to U.S. consumers, increasing their sales activities around the holidays. This prompted I.M. Wilson to seek a preliminary injunction to prevent the defendants from infringing on the U.S. GRISHKO trademarks.
In ruling on a request for a preliminary injunction, a court is required to examine four factors: (1) the plaintiff’s likelihood of success on the merits; (2) whether the plaintiff will suffer irreparable harm if relief is not granted; (3) the balance of equities; and (4) the public interest.
To show a likelihood of success, a plaintiff must demonstrate it has a valid and legally protectable mark, it owns the mark, and the defendant’s use of the mark would likely cause confusion. Here, the court found that the defendants failed to provide the "clear and convincing" evidence required of them to demonstrate fraud and challenge I.M. Wilson's incontestable marks. Moreover, the court found no evidence that the defendants revoked consent for I.M. Wilson to register his name. Thus, defendants failed to provide a basis on which to cancel I.M. Wilson's trademarks. Furthermore, the court noted where identical marks are used concurrently, the likelihood of confusion is inevitable. Thus, since statutory incontestability established both the GRISHKO marks' validity and I.M. Wilson's ownership, along with the attendant right to exclusive use, and because likelihood of confusion is an inevitable result of the concurrent use of the GRISHKO marks, the court found that I.M. Wilson met its burden of showing a probability of success on the merits.
The irreparable harm requirement is met if a plaintiff demonstrates a significant risk that he or she will experience harm that cannot adequately be compensated after the fact by monetary damages. The court relied on reports that defendants had told I.M. Wilson's retailers that I.M. Wilson will sue them should they purchase GRISHKO products from anyone other than I.M. Wilson. "It is difficult to see how it is possible for a communication such as this not to harm I.M. Wilson's reputation and goodwill." As such, the court concluded I.M. Wilson demonstrated a likelihood of irreparable harm.
The third factor a court must consider before granting preliminary injunctive relief is the harm defendant might suffer should the relief be granted. Although it is true that a preliminary injunction would prevent the defendants from selling GRISHKO-branded products in the United States during the pendency of the case, the court did not see the balance of hardships tipping in the defendants' favor as a result. There is nothing to indicate that an injunction would irreparably impact the defendants' business, said the court, but a failure to grant a preliminary injunction might do that to I.M. Wilson's. Even with a preliminary injunction in place, the defendants will be able to sell their products everywhere else in the world other than in the United States, the court noted. The balance of equities weighed in I.M. Wilson's favor, the court found.
Finally, the court found that the public interest factor weighed in favor of the defendants. The split ownership of the trademark and associated products is confusing to the public, the court said, where people are expecting to purchase Russian-made ballet items when they purchase GRISHKO products and are instead purchasing whatever products I.M. Wilson is now selling to which it simply affixes the name "GRISHKO." The fact that a preliminary injunction would prevent the public in this country from having the ability to purchase the defendants' products is undoubtedly against the public interest, the court stated.
In conclusion, the court found that the first three factors tipped in I.M. Wilson's favor, although the public interest did not. However, the court concluded that all four factors together, on balance, weighed sufficiently in I.M. Wilson's favor to rule that a preliminary injunction was appropriate. However, the court went to on state that, because it was by no means inevitable that I.M. Wilson will prevail in the next phase of the litigation, it would entertain submissions on the issue of the amount of the bond to be posted by I.M. Wilson in connection with issuance of the preliminary injunction.
The defendants filed a motion to dismiss or stay this action pending arbitration. They sought to compel arbitration as set forth in the arbitration clause in the 1992 exclusive license and trademark agreement entered into by the parties. However, the court denied the motion because the arbitration provision terminated along with the 1992 agreement and this dispute does not relate back to that agreement while it was in effect.
This case is No. 2:18-cv-05194-GEKP.
Attorneys: Brian A. Coleman (Drinker Biddle & Reath LLP) for I.M. Wilson, Inc. Brian Patrick Kinder (The Kinder Law Group) for Grishko Dance, S.R.O. and Otvetstvennostyou "Grichko".
Companies: I.M. Wilson, Inc.; Grishko Dance, S.R.O.
MainStory: TopStory Trademark PennsylvaniaNews
Interested in submitting an article?
Submit your information to us today!Learn More
IP Law Daily: Breaking legal news at your fingertips
Sign up today for your free trial to this daily reporting service created by attorneys, for attorneys. Stay up to date on intellectual property legal matters with same-day coverage of breaking news, court decisions, legislation, and regulatory activity with easy access through email or mobile app.