Opinion ID: 59587
Heading Depth: 3
Heading Rank: 2

Heading: Application to the Agreement

Text: As recognized by the parties, Paragraph 6 of the Agreement contains the only explicit release of claims by Plaintiffs. Pursuant to Paragraph 6, Riley released “all claims arising prior to the date first above written and asserted by RILEY against M.J. in the aforementioned lawsuit.” Thus, to be released under the terms of the Agreement, a claim must (1) arise prior to the Agreement, and (2) have been asserted in the 1983 lawsuit. The claims in this case arose after the Agreement was signed and were not included in the 1983 lawsuit. Consequently, there is no explicit release of the present claims contained in the Agreement, which militates in favor of the conclusion that the Agreement does not release the instant claims. See Victoria Bank, 811 S.W.2d at 938 (stating that claims not clearly within the release are not discharged). Further, the principle of expressio unius est exclusio alterius counsels us that “the expression in a contract of one or more things of a class implies the exclusion of all not expressed, even though all would have been implied had none been expressed.” Oxy USA, Inc. v. Sw. Energy Prod. Co., 161 S.W.3d 277, 285 (Tex. App.—Corpus Christi 2005, pet. denied) (internal quotation marks omitted). Therefore, the Agreement’s specific inclusion of past claims in the 9 No. 06-20624 release and its silence regarding future claims indicates that the parties did not intend to release future claims. Regardless, Defendants argue that the Agreement, when read as a whole, releases all of the trademark and trademark-related claims in this case. Defendants base this interpretation primarily on Paragraphs 2 and 8 of the Agreement. According to Defendants, because Paragraph 2 requires them to use their “best efforts” with respect to “any product” they produce and Paragraph 8 creates a limited remedy for defaults, the Agreement was clearly intended “to create a mechanism to guide future conduct, resolve future disputes, and limit potential future remedies to just two options.” Turning first to Paragraph 2, we note that it does require Defendants to use “the following best efforts” to prevent a Riley’s mark from appearing on “any product” made by Defendants. The Agreement then describes what “the following best efforts” entail. Pursuant to those paragraphs, Defendants must mask or mark out the Riley’s mark if Defendants’ product “includes the use of any paper well log . . . .” The products at issue in the current lawsuit are the reproduction of electronic or microfiche images that are already stored in Defendants’ log library.8 The allegedly infringing products, thus, do not “include[] the use of any paper well log.” Consequently, no action is required by Defendants under the Agreement with respect to Defendants’ reproduction of images. Therefore, the reproduction of images with the Riley’s mark does not result in a default under the Agreement, and we are left with an action that is not prohibited by the Agreement, but arguably not allowed under trademark law and state law. Essentially, then, Defendants read the Agreement as permitting 8 To the extent Plaintiffs’ claims include allegations that Defendants are continuing to make initial scans of paper well logs without masking or marking out the Riley’s mark, Plaintiffs do not appear to contest that such claims are subject to the limited remedies of Paragraph 8. 10 No. 06-20624 the alleged infringements by virtue of not creating a remedy for such actions or explicitly prohibiting them. Defendants err by interpreting the Agreement’s failure to create a “best efforts” solution for the reproduction of images as permission to continue to use the Riley’s mark in the reproduction of images from their log library. Although decided pursuant to Louisiana law, we find this court’s opinion in Brennan’s, Inc. v. Dickie Brennan & Co., 376 F.3d 356 (5th Cir. 2004), instructive on this point. In Brennan’s, feuding relatives in the restaurant industry signed a consent-touse agreement regarding the Brennan’s name. Id. at 359-60. Brennan’s then sued Dickie Brennan for trademark violations when Dickie Brennan allegedly used the Brennan’s name in ways not permitted by the agreement. Id. at 360. Dickie Brennan argued that the existence of the agreement barred any trademark claims. Id. at 364-67. We disagreed. In reaching our decision, we framed the question as “whether the agreement bars Brennan’s from pursuing a trademark case for uses outside of those contemplated and permitted by the agreement.” Id. at 366-67. We concluded that By its terms, the language of the agreement does not preclude such a suit, for it provides only that Brennan’s “shall not object . . . so long as” Dickie follows the contract’s guidelines. The contract does not say that Brennan’s has relinquished the right to pursue trademark remedies for uses that are not permitted by the agreement. . . . The agreement accordingly cannot be taken to mean that Brennan’s has implicitly given up its preexisting right to pursue trademark claims as to unauthorized uses. Put differently, the fact that Brennan’s permitted Dickie to engage in certain specified uses without fear of liability does not mean that Dickie is thereby immunized from trademark liability for all unauthorized uses. Id. at 367. 11 No. 06-20624 The same holds true in this case. The fact that the Agreement created a “best efforts” standard for certain uses of the Riley’s mark does not eliminate any rights Plaintiffs may have for uses of the Riley’s mark that are not permitted, or even addressed, by the Agreement. Brennan’s is admittedly distinguishable from the instant suit in that, in this case, the parties agreed to certain limited remedies in the Agreement. However, the limited remedies apply only in the event of a default. Because Defendants’ alleged actions are not prohibited by the Agreement, Defendants’ conduct is not a default, and the limited remedies provision is inapplicable. Consequently, even when read as a whole, the Agreement does not waive Plaintiffs’ future trademark claims against Defendants for conduct not addressed by the Agreement. Defendants argue that such an interpretation violates the goal of the Agreement to fix a past problem and create a manner and means for resolving future disputes. While it is true that the Agreement was intended to resolve the 1983 litigation and create some standards for conduct going forward, the Agreement simply does not contain the language necessary to have the drastic effect of waiving all future trademark claims. See Reliant Energy, 349 F.3d at 822 (stating that courts must look to the plain language of a contract to determine the parties’ intentions). These are sophisticated parties who were represented by counsel at the time the Agreement was signed. It is not reasonable that they would agree to release all future claims only by strained implication, and the district court erred in concluding otherwise. Therefore, we REVERSE the judgment of the district court and REMAND for further proceedings consistent with this opinion.