The Coca Cola Co v. Boston's Bar Supply ( 1999 )

UNITED STATES COURT OF APPEALS
For the Fifth Circuit
No. 98-20420
THE COCA-COLA COMPANY,
Plaintiff - Counter Defendant - Appellee,
VERSUS
BOSTON’S BAR SUPPLY, ET AL.
Defendants,
NEVER SAY DIE, doing business as Bar Supplies Unlimited,
Defendant - Appellant,
BOSTON’S BAR SUPPLY; DONALD MANSFIELD,
Defendants - Counter Claimants - Appellants.
Appeals from the United States District Court
for the Southern District of Texas
(H-94-CV-3266)
JULY 22, 1999
Before EMILIO M. GARZA, DeMOSS, and PARKER, Circuit Judges.
PER CURIAM:*
The appellants-defendants, Boston’s Bar Supply, Never Say Die,
Inc., and Donald Mansfield, appeal the district court’s judgment in
favor of plaintiff-appellee, The Coca-Cola Company (“Coca Cola”),
on Coca-Cola’s claims for trademark infringement and injunctive
relief. Having reviewed the briefs, heard the parties’ arguments,
*
Pursuant to 5TH CIR. R. 47.5, the Court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
and considered relevant portions of the record, we affirm the
district court.
I.
Donald Mansfield began operating a bar and equipment supply
company, Boston’s Bar Supply (“Boston’s”), in Houston, Texas in
1987. Boston’s was a full service supplier that provided all
supplies and equipment necessary for running a tavern or bar,
including mixes, juices, and sodas. In the course of its
operations, Boston’s opened an account with Houston’s Coca-Cola
Bottling Company to distribute all Coca-Cola products except Coca-
Cola fountain syrup. To satisfy those customers who needed Coca-
Cola fountain syrup, Boston’s purchased the syrup from two
distributors, Sysco Food Services of Houston, Inc. (“Sysco”) and
White Swan, Inc.
In 1988, Boston’s applied to Coca-Cola to become an authorized
distributor of Coca-Cola products, including Coca-Cola fountain
syrup. After inspecting Boston’s premises Coca-Cola denied the
application. Boston’s, however, continued to supply its customers
with Coca-Cola fountain syrup it bought from Sysco and White Swan.
In 1991, Boston’s again applied for authorization to distribute
Coca-Cola fountain syrup. Coca-Cola again denied the request.
In 1993, Coca-Cola demanded that Boston’s cease the
unauthorized distribution of its fountain syrup. In 1994, Coca-
Cola repeated that demand and filed suit against Boston’s in
district court alleging, among other things, federal trademark
violations. Coca-Cola then filed a motion for preliminary
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injunction. The district court, while denying the request for
preliminary injunctive relief, concluded that Coca-Cola would be
entitled to permanent injunctive relief unless Boston’s could
successfully prove its defense that Coca-Cola had acquiesced to
Boston’s use of the Coca-Cola fountain syrup. After granting
summary judgment against various counterclaims asserted by
Boston’s, the district court commenced a non-jury trial on Boston’s
affirmative defense of acquiescence. After Boston’s presented its
evidence and rested its case, the district court granted Coca-
Cola’s motion for judgment as a matter of law. The district court
then entered a permanent injunction against Boston’s use of Coca-
Cola fountain syrup. Boston’s then appealed.
In an unpublished per curiam opinion, this Court reversed the
district court’s ruling. The Coca-Cola Company v. Boston’s Bar
Supply, No. 96-21162 (August 12, 1997). Although affirming the
district court on other issues, we found that the district court
had applied the wrong standard for deciding the defense of
acquiescence. Specifically, the district court applied an active
standard developed by the Eleventh Circuit, see Coach House
Restaurant v. Coach & Six Restaurants, 934 F.2d 1551 (11th Cir.
1991) (defining acquiescence as an active representation), instead
of the more passive standard utilized by the Fifth Circuit. That
standard defines acquiescence as any implicit or explicit
assurances which induce reliance, Conan Properties, Inc. v. Conans
Pizza, Inc., 752 F.2d 145, 153 (5th Cir. 1985). Accordingly, we
vacated the district court’s judgment and remanded the action to
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allow the court to reconsider the facts under the appropriate
standard.
In June 1996, while that appeal was pending, Coca-Cola filed
a motion with the district court to add Never Say Die, Inc., as a
party defendant pursuant to Rule 25(c) of the Federal Rules of
Civil Procedure. See Fed. R. Civ. P. 25(c). Coca-Cola filed the
motion because Boston’s had transferred all of its assets to Never
Say Die,2 and Coca-Cola suspected that the transaction was a
fraudulent attempt to dodge creditors. On April 21, 1997, before
the district court could rule on the motion, Never Say Die filed
for bankruptcy. On April 30, 1997, unaware of the bankruptcy
filing, the district court added Never Say Die as a defendant. On
November 12, 1997, the bankruptcy court dismissed Never Say Die’s
bankruptcy petition with prejudice.
On remand, the district court held a hearing and ordered the
parties to file “motions for judgment” accompanied by supplemental
briefing. On April 7, 1998, the district court granted judgment in
favor of Coca-Cola, finding that the facts of the case did not
support the defendants’ acquiescence defense under Conan. The
district court then entered final judgment, and reinstituted its
permanent injunction in favor of Coca-Cola. Boston’s Bar Supply,
Never Say Die, Inc., and Donald Mansfield filed the instant appeal
(“appellants”).
2
Never Say Die, which was formed on the eve of the transfer,
was owned by Janice Mansfield, the wife of Donald Mansfield.
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II.
We review the district court’s decision to grant judgment as
a matter of law de novo, applying the same legal standards as the
district court. Omnitech Int’l Inc. v. Clorox Co., 11 F.3d 1316,
1322-23 (5th Cir. 1994). Judgment as a matter of law is proper
after a party has been fully heard on a given issue and “there is
no legally sufficient evidentiary basis for a reasonable jury to
find for that party on that issue." Fed. R. Civ. P. 50(a). In
evaluating the motion for judgment as a matter of law, the court
must consider all of the evidence in the light most favorable to
the nonmovant, drawing all factual inferences in favor of the
non-moving party. Nero v. Industrial Molding Corp., 167 F.3d 921,
925 (5th Cir. 1999).
III.
The appellants’ contentions can be grouped into three separate
categories. First, the appellants assert that the district court
erred by applying federal trademark law to this action. This
claim, however, was expressly raised in the prior appeal and
squarely rejected by this Court. Boston’s Bar Supply, No. 96-21162
at 2-3. Accordingly, under the law of the case doctrine we need
not reconsider the argument as there is no indication that (1)
evidence at a subsequent trial was substantially different, (2)
controlling authority has since made a contrary decision of law
applicable, and (3) the decision was clearly erroneous and a
manifest injustice. White v. Murtha, 377 F.2d 428, 431-32 (5th
Cir. 1967).
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Second, the appellants maintain that the district court erred
in finding that Coca-Cola did not acquiesce to Boston’s use of its
fountain syrup. In order to establish the defense of acquiescence,
a defendant must prove that: (1) the plaintiff knew or should have
known of the defendant’s use of the trademark; (2) the plaintiff
made implicit or explicit assurances to the defendant; and (3) the
defendant relied on the assurances. Conan, 752 F.2d at 152 n.3.
We have reviewed the relevant portions of the record and find no
reversible error in the district court’s determination.
Finally, the appellants insist that the district court erred
by adding Never Say Die as a party defendant when it had filed for
bankruptcy and triggered the automatic stay. However, the
appellants have not cited even a single case for the proposition
that a bankruptcy stay voids a subsequent joinder. In the absence
of such authority, we decline to accept that argument.
IV.
For the foregoing reasons we affirm the district courts
judgment.
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