Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_10-cv-02423/USCOURTS-azd-2_10-cv-02423-0/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1125 Trademark Infringement (Lanham Act)

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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

TMC Franchise Corporation, 

Plaintiff, 

vs.

Millennium Vision, LLC; and Nastaran

Eghtesad, 

Defendants. 

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No. CV-10-2423-PHX-DGC

TEMPORARY RESTRAINING ORDER

TMC Franchise Corporation is the franchisor of retail convenience stores operated

under the CIRCLE K® trademark and franchise system. On October 2, 2009, TMC and

Millennium Vision LLC entered into a franchise agreement, pursuant to which Millennium

was granted the right to operate a CIRCLE K store in Folsom, California. The store opened

in February 2010.

On November 9, 2010, TMC filed suit against Millennium and Nastaran Eghtesad,

one of Millennium’s principals and a guarantor to the franchise agreement. The verified

complaint asserts six claims: trademark infringement, false designation of origin, violation

of the Arizona Uniform Trade Secrets Act, breach of contract, breach of promissory note, and

breach of personal guaranty. Doc. 1. TMC seeks injunctive relief, specific performance,

damages, and attorneys’ fees. Id.

On November 16, 2010, TMC filed an application for a temporary restraining order

(TRO) against Millennium pursuant to Rule 65 of the Federal Rules of Civil Procedure.

Doc. 11. In an order dated November 22, 2010, the Court noted that the application does not

Case 2:10-cv-02423-DGC Document 19 Filed 12/17/10 Page 1 of 5
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contain a certificate showing that it has been served on Defendants, and directed TMC to

comply with Rule 65(b)(1) if the application is brought without notice. Doc. 15. On

December 9, 2010, TMC filed a request that the Court issue a TRO without notice pursuant

to Rule 65(b)(1). Doc. 17.

Having considered the requirements of Rule 65 and the standard for obtaining

temporary injunctive relief, and having reviewed the well-pled factual allegations of the

verified complaint, the application for a TRO, the request for issuance without notice, and

the supporting affidavits and exhibits, the Court finds that a TRO should issue without notice.

I. The Application for TRO.

To obtain a temporary restraining order, TMC must show that it is likely to succeed

on the merits, that it is likely to suffer irreparable harm in the absence of preliminary relief,

that the balance of equities tips in its favor, and that an injunction is in the public interest.

Winter v. Natural Res. Def. Council, 555 U.S. 7, 129 S. Ct. 365, 374 (2008).

A. Success on the Merits.

TMC has shown that it is likely to succeed on its trademark infringement claims

(counts one and two) and its claim for breach of contract (count four). The verified

complaint and the evidence presented in support of the application for a TRO show that

Millennium has breached the franchise agreement by failing to pay royalty and promotional

fees to TMC, and has breached post-termination obligations of that agreement and infringed

TMC’s federally-registered trademarks by continuing to use the CIRCLE K marks in

connection with the operation of its store.

B. Irreparable Harm.

TMC has shown that it is likely to suffer irreparable harm in the absence of a TRO.

The damage to TMC’s reputation and customer goodwill constitutes irreparable harm. See

MySpace, Inc. v. Wallace, 498 F. Supp. 2d 1293, 1305 (C.D. Cal. 2007) (“Harm to business

goodwill and reputation is unquantifiable and considered irreparable.”). Indeed, “[i]n a

trademark infringement claim, ‘irreparable injury may be presumed from a showing of

likelihood of success on the merits.’” GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199,

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1204 n.4 (9th Cir. 2000) (quoting Brookfield Communications, Inc. v. W. Coast Entm’t

Corp., 174 F.3d 1036, 1066 (9th Cir.1999)). “This presumption effectively conflates the dual

inquiries of this prong into the single question of whether the plaintiff has shown a likelihood

of success on the merits.” Id.

C. Balance of Hardships.

Where, as in this case, the plaintiff shows intentional infringement, the defendant

“cannot complain of the harm that will befall it when properly forced to desist from its

infringing activities.” Triad Sys. Corp. v. Se. Express Co., 64 F.3d 1330, 1338 (9th Cir.

1995). Indeed, “[w]here the only hardship that the defendant will suffer is lost profits from

an activity which has been shown likely to be infringing, such an argument in defense ‘merits

little equitable consideration[.]’” Id. (citation omitted). Because TMC has shown that it is

likely to succeed on its trademark infringement claims, the balance of hardships tips in its

favor.

D. Public Interest.

The “public interests favors elimination of consumer confusion” caused by trademark

infringement. Starcom Mediavest Group, Inc. v. Mediavestw.com, No. 10-CV-04025-LHK,

2010 WL 3564845, at *1 (N.D. Cal. Sept. 13, 2010). Given that Millennium is operating a

convenience store that serves dozens, if not hundreds, of consumers each day, the public

interest is served by eliminating confusion as to whether Millennium’s store is a legitimate

CIRCLE K store.

II. The Request for Issuance Without Notice.

TMC has presented evidence showing that it made repeated attempts to serve process

on Defendants and give them notice of the application for a TRO. Doc. 17-1. It appears that

Defendants may be evading service. TMC also has shown that Defendants have actual

knowledge of this suit and the underlying dispute arising out of the franchise agreement. Id.

Specific facts in the verified complaint and supporting affidavits show that TMC has

suffered, and continues to suffer, irreparable harm to its reputation and customer goodwill

from the alleged infringing activities of Millennium. The Court finds, pursuant to Rule

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65(b)(1), that a TRO should issue without notice to Millennium.

III. Conclusion.

TMC has met its burden for obtaining a TRO without notice, that is, it has shown that

it is likely to succeed on the merits of its trademark infringement and breach of contract

claims, that it is will suffer immediate and irreparable harm if a TRO is not issued before

Millennium can be heard in opposition, that the balance of equities tips in its favor, that an

injunction is in the public interest, and that it has made diligent and good faith efforts to give

notice to Millennium. Given the nature of Millennium’s business, and TMC’s likelihood of

success on the merits, the Court concludes that security in the amount of $25,000 will

reasonably protect Millennium against injury if this injunction is entered incorrectly.

IT IS ORDERED:

1. Plaintiff TMC Franchise Corporation’s application for temporary restraining

order (Doc. 11) is granted.

2. Plaintiff TMC Franchise Corporation’s request that the Court issue a TRO

without notice (Doc. 17) is granted pursuant to Rule 65(b)(1).

3. Defendant Millennium Vision LLC, its officers, agents, servants, and

employees, and those persons in active concert or participation with them who

receive actual notice hereof by personal service or otherwise, are prohibited

from using the CIRCLE K® trademarks, trade name and trade dress and falsely

associating with the CIRCLE K® franchise system.

4 Defendant Millennium Vision LLC is required to comply fully with its posttermination obligation to de-identify contained in paragraph 12.7(C) of the

parties’ franchise agreement (Doc. 1-1 at 36). Specifically, Millennium Vision

shall (a) immediately cease using the CIRCLE K® Marks or any name, logo,

slogans, or symbols or other designations that might tend to mislead or confuse

the public or give the impression that Millennium Vision’s store, located at

301 E. Bidwell Street, Folsom, California, is associated with Plaintiff TMC

Franchise Corporation’s or its CIRCLE K® brand.

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5. Pursuant to Rule 65(c), Plaintiff TMC Franchise Corporation shall promptly

post a security bond in the amount of $25,000.00.

6. Plaintiff TMC Franchise Corporation and its counsel immediately shall make

a good faith and diligent effort to serve a copy of this order on Defendants.

7. This temporary restraining order, unless extended for good cause, expires on

December 30, 2010.

8. A preliminary injunction hearing will be held on December 30, 2010

at 2:00 p.m.

DATED this 17th day of December, 2010 at 12:25 p.m..

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