In the

United States Court of Appeals

For the Seventh Circuit

No. 00-4212

Re/Max North Central, Inc.,

Plaintiff-Appellee,

v.

Patricia Cook, f/d/b/a Re/Max Lake and Country,

Defendant-Appellant.

Appeal from the United States District Court

for the Eastern District of Wisconsin.

No. 00-C-1314--John W. Reynolds, Judge.

Argued May 16, 2001--Decided November 13, 2001

 Before Harlington Wood, Jr., Coffey, and

Williams, Circuit Judges.

 Coffey, Circuit Judge. On May 1, 1993,

Re/Max North Central, Inc. entered into a

franchise agreement with Patricia Cook,

granting her the exclusive right to

operate a Re/Max real estate office

within a defined area that included

Mukwonago, Wisconsin. When the 1993

agreement expired in 1998, the parties

negotiated the terms of a successor

agreement. Cook, however, never signed

the successor agreement because she

continued to object to its terms. After

Re/Max made several attempts at

reconciliation in hopes of solving the

problem, it terminated her franchise

rights on August 11, 2000. In spite of

the termination Cook continued to use

Re/Max’s marks and logos, and Re/Max

consequently sought and received a

preliminary injunction in the United

States District Court for the Eastern

District of Wisconsin prohibiting Cook

from continuing to use its trademarks and

logos. Cook appeals the district court’s

imposition of the preliminary injunction,

arguing that Re/Max failed to comply with

the Wisconsin Fair Dealership Law when it

terminated her franchise rights. We

affirm. 

I. Factual Background
 On May 1, 1993, Cook entered into a

franchise agreement with Re/Max to

operate an exclusive Re/Max franchise in

the Mukwonago-East Troy area of

southeastern Wisconsin. The 1993

agreement was for an initial term of five

years and provided Cook with the

opportunity to renew the agreement for

two additional five-year terms, provided

that, among other things, Cook gave

Re/Max written notice of her intent to

renew not less than six (6) months prior

to the end of the agreement and further

that she was not in default under the

terms of the 1993 agreement. Section 6.C

of the 1993 agreement further provided

that if Cook chose to renew her franchise

rights beyond the initial period, she was

required to do so under the terms of the

franchise agreement being used at the

time of her renewal.

 In compliance therewith, Cook provided

Re/Max with both a verbal and written

notice of her intent to renew her

franchise rights in August 1997. Re/Max

did not immediately advise Cook that

renewal would be forthcoming, but on

April 10, 1998, Re/Max provided Cook with

a copy of the 1998 Re/Max Franchise

Offering Circular. Shortly after

receiving the 1998 circular, Cook

tendered to Re/Max a check in the amount

of $8,500, twice the amount required to

renew her franchise agreement. On May 1,

1998, Re/Max responded with a letter to

Cook expressing its concerns about the

renewal of Cook’s subfranchise rights due

to her failure to meet the sales

associate quota required in the 1993

agreement. Under the 1993 agreement Cook

had been required to retain a minimum of

five (5) sales associates in her office

by May 1996. Cook, however, was the only

sales associate operating out of that

location throughout the term of the 1993

agreement. Despite these concerns, Re/Max

nevertheless offered to extend the term

of the 1993 agreement for six months in

order that it might ascertain whether

Cook was willing and able to comply with

the sales associate quota.

 On November 25, 1998, Re/Max issued Cook

a notice of default because she had

failed to hire the requisite number of

sales associates (5) under the 1993

agreement. In the notice of default,

Re/Max expressed its intention not to re

new her agreement unless she cured her
default by expanding her office and

hiring the requisite number of sales

associates before January 26, 1999. In

order that she might comply with the

sales associate quota, Cook hired several

family members,/1 though none of them

had ever been a member of the Milwaukee

Metro Multiple Listing Service./2

Despite Cook’s questionable hires, Re/Max

accepted her identification of the sales

associates and began the renewal process.

Because Re/Max had not yet completed its

1999 franchise offering circular,/3 it

allowed Cook to operate her franchise on

a month-to-month basis under the terms of

the 1993 franchise agreement until Re/Max

had completed the 1999 circular.

 In April 1999, Re/Max registered its

1999 franchise offering circular with the

State of Wisconsin and provided Cook with

a copy to review and thereafter in June

forwarded a copy of the proposed 1999

franchise agreement to her for execution.

Cook was not interested in signing the

agreement at this time as she was in

hopes of negotiating the terms of the

agreement, particularly the term dealing

with the number of sales associates she

was required to employ in her office.

Re/Max desired that Cook retain at least

five (5), if not more, sales associates

in her sales office, while Cook wished to

retain only two (2). Re/Max acceded to

Cook’s wish and engaged in lengthy

negotiations with Cook and her counsel

about the terms of the 1999 agreement,

focusing almost exclusively on terms

related to the sales associate quota. In

September 1999 Cook and Re/Max ultimately

agreed that the sales associate quota

would remain at five (5).

 Shortly after Re/Max and Cook concluded

their negotiations, Re/Max provided Cook

with copies of the 1999 franchise

agreement for her to execute. By November

8, 1999, more than six weeks after the

1999 agreement had been forwarded to

Cook, Cook still had not signed it.

Re/Max inquired of Cook in writing,

asking her if her delay in signing the

franchise renewal agreement meant that

she did not wish to renew her franchise

rights. Cook responded to Re/Max’s

inquiry by returning the 1999 agreement

on or about November 17, 1999. But

instead of executing the negotiated 1999

agreement forwarded to her, Cook

unilaterally altered the term dealing

with the required number of sales
associates. Even though the parties had

previously agreed that the agreement

would require Cook to employ five (5)

sales associates, Cook instead suggested

that she only be required to retain two,

a suggestion that Re/Max had previously

rejected during negotiations. Re/Max

declined to accept Cook’s proposed

changes, and informed her that, unless

she executed the 1999 agreement by

December 20, 1999, as the parties had

negotiated it, it would be forced to

conclude that she was not interested in

renewing her franchise. 

 On January 26, 2000, still awaiting a

response from Cook, Re/Max placed Cook’s

franchise agreement in default, provided

her with 90 days notice of termination.

The notice of termination gave Cook a 60-

day period, beginning on January 26,

2000, within which to cure the default by

completing the renewal requirements. In

the letter, Re/Max explained that the

1999 agreement expired on March 14, 2000

and would be replaced with the 2000

agreement. Re/Max provided Cook with two

options to cure her default--renew her

franchise rights under the 1999 agreement

by signing and returning it before March

14 or renew her franchise rights under

the 2000 agreement if she chose to do so

after March 14.

 Cook did not sign and return the 1999

agreement by March 14, 2000. Accordingly,

on March 20 Re/Max sent Cook a copy of

the 2000 Uniform Offering Circular by

overnight mail and also extended the time

within which Cook could cure her default

with the signing of the 2000 agreement,

in order to provide Cook the legally

mandated time to review the offering. But

instead of later signing the 2000

agreement, as instructed in both Re/Max’s

January 26 and March 20 correspondence,

Cook signed the expired 1999 agreement

and returned it to Re/Max on March 27,

2000. 

 Re/Max did not countersign the outdated

1999 agreement because that agreement was

no longer registered in Wisconsin, having

been replaced by the 2000 agreement.

Re/Max informed Cook that it could not

sign the 1999 agreement because it was no

longer registered, but once more provided

Cook with additional time to sign the

2000 agreement. Cook again refused to

sign the 2000 agreement, without offering
an accompanying explanation. Despite

Cook’s obstinance, Re/Max attempted to

continue negotiations with Cook and

offered her the option of signing the

1999 agreement with an accompanying

release agreeing not to sue Re/Max for

allowing her to renew her franchise

rights under an expired agreement. Cook

refused, and once again refused to sign

the 2000 agreement, though she never did

express any reason for her refusal. On

July 5, 2000, Re/Max again extended

Cook’s time to cure the default and

established a final cure date of July 10,

2000 and notified Cook that her franchise

rights would be terminated effective

August 11, 2000 if she had not renewed

her franchise rights by executing an

effective agreement by July 10. Re/Max

offered Cook the choice between executing

the 2000 agreement or the 1999 agreement

accompanied by a waiver releasing Re/Max

from liability for allowing Cook to

execute an expired agreement. Cook failed

to cure her default, and Re/Max

terminated her franchise rights on August

11, 2000.

 Despite having refused to sign a

franchise agreement as well as refusing

to honor the termination of her franchise

rights on August 11, Cook took it upon

herself to continue to use the Re/Max

marks and continued to hold herself out

as a licensed provider of Re/Max real

estate services even after she had

received notice that her right to engage

in the real estate business under the

Re/Max name had been terminated. Re/Max

at that time filed this suit seeking an

injunction against Cook for trademark

infringement under the Lanham Act, 15

U.S.C. sec. 1065. In the district court,

Cook argued that Re/Max had terminated

her franchise rights in violation of the

Wisconsin Fair Dealership Law ("WFDL"),

Wis. Stats. sec.sec. 135.01 et seq.,

because it had not given her 60 days to

cure her default. According to Cook,

Re/Max’s requirement that she sign the

1999 agreement before March 14 gave her

only 48 days to cure her default and that

she should be given an additional 60 days

from March 14 to sign the 2000 agreement.

Cook reasoned that she should be given an

additional 60 days to sign the 2000

agreement because the 2000 agreement

contained a new term that was not

acceptable to her. Cook observed that the

1999 agreement had granted her the
exclusive right to operate a Re/Max

franchise in her protected territory and

thus prohibited Re/Max from granting any

other franchise in that territory. The

2000 agreement, however, allowed Re/Max

to issue a commercial-only franchise to

other potential franchisees within her

protected territory. 

 Re/Max responded that it had given her

60 days to sign a then-existing

agreement, noting that both the 1999

agreement expired after March 14. Re/Max

argued that during the negotiations that

proceeded between April 2000 and July

2000, Cook never once informed it that

she objected to the term allowing Re/Max

to issue commercial-only franchises.

Re/Max also pointed out that since 1993

Cook had only two commercial listings,

and therefore the 2000 agreement did not

substantially change Cook’s competitive

circumstances. 

 The district court rejected Cook’s WFDL

argument and found that Re/Max had given

Cook the required 60 days to cure her

default. Thereafter, the judge ruled that

since Cook had refused to execute a

franchise agreement within the time frame

allowed, Re/Max’s action in terminating

her franchise rights was proper.

Furthermore, the judge ruled that he was

convinced that Re/Max could demonstrate a

likelihood of success on the merits on

its Lanham Act claim that Cook’s

continued use of Re/Max’s marks and logos

infringed upon Re/Max’s trademark rights.

The court further determined that Re/Max

would suffer irreparable injury for which

it had no adequate legal remedy if

theinjunction were not granted. Finally,

the court ruled that Cook had failed to

establish that she would suffer any

irreparable harm if the injunction were

granted. Accordingly, the court granted

Re/Max’s motion for a preliminary

injunction. 

II. Issues

 Cook raises three issues on appeal.

First, she challenges the district

court’s determination that Re/Max is

likely to prevail on the merits, renewing

the WFDL argument that she raised below.

Second, Cook argues that the district

court erred in its conclusion that Re/Max

would suffer irreparable harm if the

injunction were not granted. Finally,
Cook contends that the district court

improperly weighed the relative harm to

Cook in granting the injunction.

III. Analysis

 We review a decision denying or granting

a preliminary injunction under the abuse

of discretion standard. Wisconsin Music

Network, Inc. v. Muzak Limited

Partnership, 5 F.3d 218, 221 (7th Cir.

1993). We give "’substantial deference to

a district court’s decision to grant a

preliminary injunction insofar as that

decision involves the discretionary acts

of weighing evidence or balancing

equitable factors.’" Gateway Eastern Rwy

Co. v. Terminal R.R. Assoc. of St. Louis,

35 F.3d 1134, 1137 (7th Cir. 1994)

(quoting United States v. Baxter

Healthcare Corp., 901 F.2d 1401, 1407

(7th Cir. 1990)). "’The question for us

is whether the judge exceeded the bounds

of permissible choice in the

circumstances, not what we would have

done if we had been in his shoes.’"

Wisconsin Music Network, Inc., 5 F.3d at

221 (quoting Roland Machinery Co. v .

Dresser Indus., 749 F.2d 380, 390 (7th

Cir. 1984)).

 Before a court will grant a preliminary

injunction, the movant must demonstrate a

likelihood of success on the merits, the

existence of an irreparable harm without

the injunction, and an inadequate remedy

at law. Meridian Mut. Ins. Co. v.

Meridian Ins. Group, Inc., 128 F.3d 1111,

1114 (7th Cir. 1997); Gateway Eastern Rwy

Co., 35 F.3d at 1137; Wisconsin Music

Network, Inc., 5 F.3d at 221. If the

moving party meets this threshold burden,

then the court weighs the relative harms

to the respective parties and the

probability of the movant’s success on

the merits. Gateway Eastern Rwy Co., 35

F.3d at 1137; Wisconsin Music Network,

Inc., 5 F.3d at 221.

A. Likelihood of Success on the Merits

 In its complaint in the district court,

Re/Max alleged that Cook continued to use

its marks after Re/Max had terminated her

franchise rights, in violation of the

Lanham Act, 15 U.S.C. sec. 1065. Cook

does not dispute that she continued to

use Re/Max’s marks, but argues instead

that Re/Max was not likely to prevail on

the merits because Re/Max had never
properly terminated her franchise rights,

relying primarily on various portions of

the Wisconsin Fair Dealership Law (WFDL).

Wis. Stats. sec.sec. 135.01 et seq. 

 Cook rests her initial argument upon the

notice and cure provision of the WFDL,

which required Re/Max to provide Cook

with written notice of default 90 days

prior to terminating her franchise

agreements and also allow Cook 60 days to

cure any default. Wis. Stats. sec.

135.04. Cook contends that Re/Max failed

to comply with the notice and cure

provision of the WFDL because Re/Max’s

January 26 notice required her to sign

the 2000 agreement (instead of the

expired 1999 agreement) after March 14

and provided her with only 48 days within

which to cure her default. Cook’s

argument mistakenly assumes that the

default was her failure to execute the

1999 agreement. The January 26 notice,

however, clearly explains that Cook’s

default is her "failure to complete a

proper renewal of [her] Re/Max

franchise," not that Cook has failed to

execute the 1999 agreement.

 Re/Max gave Cook 60 days to cure her

default by executing a valid franchise

agreement. It allowed her to sign the

1999 agreement anytime during the 48 days

during which it was in effect or it

allowed her thereafter to sign the 2000

agreement once it became effective.

Furthermore, even after the 60-day period

had elapsed, Re/Max extended Cook’s cure

period until July 10, 2000 and did not

finally terminate her franchise rights

until August 11, 2000. Re/Max gave Cook

much more than the required 60 days, 167

to be precise, to cure her default by

signing an agreement registered with

Wisconsin, and she steadfastly refused to

do so.

 Cook argues that the WFDL required

Re/Max to issue separate cure and default

notices for both the 1999 and the 2000

agreement. She cites no precedent in

support of this argument and instead

offers only weak and unconvincing excuses

for her failure to sign an existing

agreement during the period Re/Max

provided her to cure her default. For in

stance, Cook makes much of the fact that

her 1993 agreement expired in early 1999

and she didn’t receive copies of the 1999

agreement until September 1999. Cook’s
argument is nothing more than a red

herring. Re/Max could not have sent Cook

copies of the 1999 agreement before

September 1999 because Re/Max continued

to negotiate with Cook from June 1999 to

September 1999 concerning the terms of

the 1999 agreement. Cook cannot now claim

that Re/Max failed to provide her with

the agreement in a timely fashion after

Re/Max accommodated her concern regarding

the terms of the agreement by negotiating

with her. Further, even after Re/Max

provided Cook with the agreement in

September 1999, Cook refused to sign it.

When Re/Max inquired into her refusal in

November 1999, Cook responded by

unilaterally amending the agreed upon

terms to ones more favorable to her.

Still, Re/Max did not immediately send

Cook a notice of default, but rather gave

her additional time to execute the 1999

agreement and did not send her a notice

of default until January 26, 2000. Cook

repeatedly refused to execute the 1999

agreement, a refusal motivated by her

desire to force Re/Max to assent to terms

more favorable to her. However, a

franchisee cannot hold hostage a

franchisor’s marks to force it to

negotiate terms more favorable to the

franchisee. Gorenstein Enterprises, Inc.

v. Quality Care-USA, Inc., 874 F.2d 431,

435 (7th Cir. 1989).

 Cook next suggests that Re/Max

terminated her franchise rights in

violation of Wis. Stats. sec. 135.03.

Under sec. 135.03 of the WFDL, "[no]

grantor . . . may terminate, cancel, fail

to renew or substantially change the

competitive circumstances of a dealership

agreement without good cause." (emphasis

added). Cook objects to a provision in

the 2000 agreement that allowed Re/Max to

issue commercial-only franchises in her

protected area. Cook devotes much of her

argument to establishing that Re/Max did

not have "good cause" to include this

provision in the 2000 agreement. Cook’s

argument is misdirected. The trial judge

found that the alleged change did not

"substantially change" the competitive

circumstances of Cook and Re/Max’s

agreement. See East Bay Running Store,

Inc. v. Nike, Inc., 890 F.2d 996, 999-

1000 (7th Cir. 1989) (holding that the

"good cause" requirement is not

implicated without an initial finding

that the franchisor terminated,

cancelled, failed to renew, or
substantially changed the competitive

circumstances of the dealership

agreement).

 Although Cook asserts that "commercial

sales in [the Mukwonago-East Troy] area .

. . continue[ ] to grow at among one of

the fastest rates in the entire state of

Wisconsin," she points to nothing in the

record to support this assertion. Spath

v. Hayes Wheels International-Indiana,

Inc., 211 F.3d 392, 397 (7th Cir. 2000)

("a party who fails to develop the

factual basis of a claim on appeal and,

instead, merely draws and relies upon

bare conclusions" has waived that claim).

In any event, the evidence in the record

recites a different story. Cook admits

that since 1993 she has had only two

commercial listings and has not gone to

closing on either. Further, between March

27, 2000 and July 10, 2000, Re/Max sought

to resolve the dispute with Cook, and she

never did inform Re/Max that she objected

to the provision of the 2000 agreement

that allowed Re/Max to issue commercialonly franchises. Franchisors may make

system-wide nondiscriminatory changes in

order to adapt market conditions. Remus

v. Amoco Oil Co., 794 F.2d 1238, 1240-41

(7th Cir. 1986); East Bay Running Store,

Inc., 890 F.2d at 999-1000. We agree with

the trial judge that the 2000 agreement

arguably did not substantially change

Cook’s competitive circumstances.

 Finally, in a last ditch effort, Cook

reaches for straws and argues that she

"substantially performed her obligations

under the provisions of the January 26,

2000 notice." We need not spend much time

dealing with this argument. Certainly,

Cook cannot dispute that Re/Max was

entitled to require its franchisees to

operate with a valid franchise agreement.

See, e.g., Moodie v. School Bd. Fairs,

Inc., 889 F.2d 739, 745-46 (7th Cir.

1989). Cook suggests instead that her act

of signing the expired, 1999 agreement

should suffice. However, it is undisputed

that Re/Max required all franchisees

entering or renewing agreements after

March 14, 2000 to sign the 2000

agreement, not the expired 1999

agreement. Further, the 1993 agreement,

under which Cook had been operating,

specifically required that Cook renew her

franchise rights under the terms of the

then-current agreement. Moreover,

Re/Max’s offer to allow Cook to sign exe
cute the 1999 agreement accompanied by a

waiver clearly indicates that Re/Max

obviously did not consider Cook’s tardy

execution of the 1999 agreement to be a

substantial performance of her obligation

under the January 26 notice. Re/Max is

entitled to maintain uniform contract

terms with its dealers. Id. It is not

unreasonable for Re/Max to rewrite its

franchise agreements in an orderly

fashion. Wisconsin Music Network, Inc., 5

F.3d at 223. 

 In the end, Re/Max waited more than two

years after the expiration of the 1993

franchise agreement to terminate Cook’s

franchise. When Cook disagreed with the

terms of the 1999 agreement, Re/Max

repeatedly attempted to negotiate with

her regarding the agreement’s terms. Even

after these negotiations, Cook had almost

7 months during which she could have

executed the 1999 agreement, and

shestubbornly refused to do so,

continuing to insist upon terms more

favorable to herself. As we noted

earlier, a franchisee cannot hold hostage

a franchisor’s marks to force it to

negotiate terms more favorable to the

franchisee. Gorenstein Enterprises, Inc.,

874 F.2d at 435. Although Cook paints

herself as someone who desperately wished

to retain her Re/Max franchise, her

actions speak louder than her words.

Re/Max made every effort to accommodate

her. We agree with the trial judge’s

ruling that Re/Max did not violate the

WFDL when it finally terminated Cook’s

franchise and therefore was likely to

succeed on the merits.

B. Irreparable Injury and Inadequate

Legal Remedy

 A party seeking a preliminary injunction

must demonstrate that they will suffer an

irreparable injury if the injunction is

not granted for which they have no

adequate remedy at law. Gateway Eastern

Rwy Co., 35 F.3d at 1137. Cook wildly

asserts, without any precedent to support

her assertion, that Re/Max cannot show it

will suffer an irreparable injury merely

because she has not "undertaken any

action that could be considered

deleterious to Re/Max’s marks nor . . .

is likely to do so in the future." We

have clearly and repeatedly held that

damage to a trademark holder’s goodwill

can constitute irreparable injury for
which the trademark owner has no adequate

legal remedy. Eli Lilly & Co. v. Natural

Answers, Inc., 233 F.3d 456, 469 (7th

Cir. 2000); Meridian Mut. Ins. Co., 128

F.3d at 1114; Wesley-Jesson Division of

Schering Corp., 698 F.2d 862, 867 (7th

Cir. 1983). "The most corrosive and

irreparable harm attributable to

trademark infringement is the inability

of the victim to control the nature and

quality of the defendants’ goods. Even if

the infringer’s products are of high

quality, the plaintiff can properly

insist that its reputation should not be

imperiled by the acts of another."

International Kennel Club of Chicago,

Inc. v. Mighty Star, Inc., 846 F.2d 1079,

1092 (7th Cir. 1988). While Cook

continues to use Re/Max’s marks and

logos, it has no quality over the

services she provides or potential harm

to its goodwill. Cook’s argument that

Re/Max has not established the existence

of an irreparable injury for which there

is no adequate remedy at law is without

merit.

C. Balance of Harms

 Finally, Cook suggests that the trial

court failed to adequately weigh the

relative harm to the parties in granting

the injunction. Cook argues that the

injunction would "put [her] out of

business." Cook’s melodramatic

interpretation of the impact of the

assumption is without merit. The

injunction does not prohibit Cook from

maintaining relationships with existing

clients or developing relationships with

new clients--it only requires her to

remove Re/Max logos. The injunction

allows Cook to maintain her same office

and listings and to work as an

independent real estate agent or to

select another real estate company to

contract with. As noted above, Re/Max

clearly has an interest in the goodwill

it has in its marks and logos. Further,

the public also has an interest in

knowing with whom they do business and

whether or not the agent is a franchisee

of a given real estate corporation. We

are convinced that the trial court

carefully and properly weighed the extent

of harm to each party, and we find no

error in the court’s balancing process.

IV. Conclusion
 We agree with the trial judge’s ruling

that Re/Max did not violate the WFDL when

it terminated Cook’s franchise rights.

Accordingly, we hold that the trial judge

properly found that Re/Max has a better

than negligible chance of prevailing on

the merits. We further hold that the

trial judge correctly ruled that Re/Max

has established that it will suffer an

irreparable injury if the injunction were

not granted. Finally, we hold that the

trial judge carefully and properly

weighed the harm to each party. We AFFIRM

the trial court’s grant of a preliminary

injunction, prohibiting Cook from using

Re/Max’s marks and logos.

FOOTNOTES

/1 The record does not disclose whether any of the

family members Cook hired had any real estate

experience or current real estate licenses.

/2 A multiple listing service (MLS) is a facility by

which a MLS member broker makes a blanket unilateral offer of subagency to any other MLS member

who can find a buyer to complete the sale. The

MLS computer data base contains information about

homes listed for sale with its members. MLS

members and their home- seeking prospects can

review this data via computer terminals or by

reviewing printed compilations distributed to

members on a bi-weekly basis.

/3 Uniform franchise offering circulars are prospectuses that a franchisor submits to the marketplace for consideration by potential franchisees.