Court Opinion

ID: 4535391
Source: CourtListenerOpinion
Date Created: 2020-05-19 20:00:34.176132+00
Date Added: 2024-06-11T08:45:48.657132
License: Public Domain

NOT FOR PUBLICATION                        FILED
                    UNITED STATES COURT OF APPEALS                       MAY 19 2020
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                              FOR THE NINTH CIRCUIT

NATIONAL LIGHTNING PROTECTION                   No.    19-15440
CORPORATION,
                                                D.C. No. 2:96-cv-02796-DLR
                Plaintiff-Appellant,

and                                             MEMORANDUM*

HEARY BROS. LIGHTNING
PROTECTION CO. INC.; LIGHTNING
PREVENTOR OF AMERICA, INC.,

                Plaintiffs,

 v.

EAST COAST LIGHTNING EQUIPMENT,
INC.,

                Defendant-Appellee,

and

LIGHTNING PROTECTION INSTITUTE;
et al.,

                Defendants.

                   Appeal from the United States District Court
                            for the District of Arizona
                   Douglas L. Rayes, District Judge, Presiding

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
                         Argued and Submitted May 7, 2020
                                 Portland, Oregon

Before: WATFORD and HURWITZ, Circuit Judges, and BATTAGLIA,** District
Judge.

      National Lightning Protection Corporation (“NLPC”) appeals a district court

order finding that NLPC violated a 2005 injunction and permitting limited discovery

into additional purported violations. We dismiss the appeal for lack of jurisdiction.

      1.     We do not have jurisdiction over this appeal under 28 U.S.C. § 1291,

which gives us “jurisdiction of appeals from all final decisions of the district courts.”

The district court did not impose a sanction for the violations of the injunction that

it found, and discovery continues as to whether there are other violations. Because

“[f]urther proceedings remain in the district court that could result in a second appeal

if the instant order is affirmed,” Weyerhaeuser Co. v. Int’l Longshoremen’s &

Warehousemen’s Union, Local 21, 733 F.2d 645, 646 (9th Cir. 1984) (order), the

district court’s decision is not final. See also id. at 645 (“A contempt order is not a

final order under 28 U.S.C. § 1291 prior to the imposition of sanctions.”).

      2.     We also lack jurisdiction under 28 U.S.C. § 1292(a)(1), which applies

to interlocutory orders “modifying” an injunction. The district court did not modify

the 2005 injunction but instead merely interpreted it. See Pub. Serv. Co. of Colo. v.

      **
            The Honorable Anthony J. Battaglia, United States District Judge for
the Southern District of California, sitting by designation.

                                           2
Batt, 67 F.3d 234, 238 (9th Cir. 1995) (noting that the “court of appeals lacks

jurisdiction over appeals of orders in which a district court merely enforces or

interprets a previous injunction”). The 2005 injunction prohibited NLPC from

advertising “explicitly or implicitly” that its ESE systems “protect open areas.” The

district court found that the list of customers on NLPC’s website, which included

outdoor stadiums, golf courses, and amusement parks, violated the injunction

because the “implication from the list is that its system successfully protected the

location where it was installed.” In reaching this conclusion, the district court noted

that the 2005 injunction explicitly prohibited implicit advertising and that this Court

on direct appeal1 had noted that it extends to truthful statements if used “to support

claims that ESE systems . . . can protect open spaces.” Because the district court’s

order, whether or not correct, was “pursuant to” the injunction, it did not constitute

a modification. Thompson v. Enomoto, 815 F.2d 1323, 1327 (9th Cir. 1987); see

1
       NLPC claims that the 2005 injunction was modified on appeal to extend only
to factually accurate statements that are directly used to support an untruthful
statement. See Heary Bros. Lightning Prot. Co. v. Lightning Prot. Inst., 262 F.
App’x 815 (9th Cir. 2008). However, although the memorandum disposition
indicated at one point that “we . . . modify the injunction,” it never stated how the
injunction was modified, later rejected “the plaintiffs’ request to modify the
language of the injunction,” and concluded by affirming “the injunction in all
respects.” Id. at 816-18. The memorandum disposition also stated that the
injunction prohibited “truthful advertising” used “to support” the claim “that ESE
systems can protect open spaces,” id. at 817, and did not, as NLPC claims, also state
that such truthful advertising must explicitly, rather than implicitly, support that false
claim.

                                            3
also Carson v. Am. Brands, Inc., 450 U.S. 79, 84 (1981) (“Because § 1292(a)(1) was

intended to carve out only a limited exception to the final-judgment rule, we have

construed the statute narrowly.”).

      3.     The district court also did not modify the injunction when it found that

NLPC’s statement on its website that its ESE air terminals are certified by

Underwriters Laboratories (“UL”) violated the injunction or when it allowed

discovery into the conduct of a non-party, UL. The 2005 injunction expressly

prohibited NLPC from advertising that its “air terminal product” is “accepted by

Underwriters Laboratories” and applied on its face to “agents, employees, dealers,

distributors . . . persons, partnerships, and corporations, in present or future active

concern or participation with [NLPC].”

      4.     Because we lack jurisdiction over NLPC’s appeal, we express no

opinion about whether the district court erred in finding that NLPC violated the

injunction. See Thompson, 815 F.2d at 1327.

      APPEAL DISMISSED.

                                          4
                                                                                 FILED
National Lightning Protection Corporation v. East Coast Lightning Equipment,
Inc., No. 19-15440                                                      MAY 19 2020
                                                                           MOLLY C. DWYER, CLERK
WATFORD, Circuit Judge, dissenting in part:                                    U.S. COURT OF APPEALS

      I agree with my colleagues on all but one issue. In my view, the district

court modified the 2005 injunction when it prohibited NLPC from posting on its

website a truthful list of the customers who have purchased its lightning protection

system, known as an “early streamer emissions” or “ESE” system. We have

jurisdiction to review NLPC’s challenge to that aspect of the district court’s order

under 28 U.S.C. § 1292(a)(1), and I would reverse.

      As my colleagues note, the 2005 injunction prohibited NLPC from stating,

explicitly or implicitly, that its lightning protection system “can function

effectively to protect open spaces.” But when our court upheld the injunction in

2008, we made clear that it does not prohibit truthful statements concerning “the

plaintiffs’ experience with ESE systems,” as long as such statements aren’t used

“to support claims that . . . ESE systems can protect open spaces.” Heary Bros.

Lightning Protection Co. v. Lightning Protection Institute, 262 F. App’x 815, 817

(9th Cir. 2008). With that clarification of the injunction’s scope, we declined

NLPC’s request to formally modify the language of the injunction. Id.

      NLPC’s posting of a truthful list of its customers does nothing more than

tout its “experience with ESE systems.” The list of customers is not accompanied

by any statement that could be read as implying that NLPC’s system has been
                                                                           Page 2 of 3

effective in protecting open spaces. In fact, the customer list is not accompanied by

any editorial statements whatsoever—not even a statement saying, “here’s a list of

our satisfied customers.” It’s just a list of customers who have purchased NLPC’s

product. The district court was thus mistaken in concluding that the mere posting

of the list constituted a “claim” by NLPC that its system can protect open spaces,

or an implied statement that “its system successfully protected the location where it

was installed.” The only implication that can fairly be drawn from the mere

posting of the customer list is that the customers believed—presumably after

conducting their own due diligence—that NLPC’s system provided adequate

protection for their locations such that, after taking into account price, they decided

to purchase NLPC’s system over competing systems on the market. That implied

statement is not prohibited by the 2005 injunction as we construed it in 2008.

      If a district court construes an injunction to prohibit conduct that was

previously permitted, the court has obviously modified the injunction within the

meaning of 28 U.S.C. § 1292(a)(1). See Cunningham v. David Special

Commitment Center, 158 F.3d 1035, 1037 (9th Cir. 1998). In my view that is

precisely what occurred here. So I would hold that we have jurisdiction to review

the district court’s order to the extent that it bars NLPC from merely posting on its

website a truthful list of the customers who have purchased its product. And I

would reverse that aspect of the district court’s order because it conflicts with our
                                                                          Page 3 of 3

court’s prior decision in this case by banning truthful advertising that poses no

danger of misleading consumers. See U-Haul International Inc. v. Jartran, Inc.,

793 F.2d 1034, 1042 (9th Cir. 1986). In all other respects, I agree with my

colleagues’ disposition of the appeal.