United States Court of Appeals
Fifth Circuit
IN THE UNITED STATES COURT OF APPEALS
FILED
FOR THE FIFTH CIRCUIT April 11, 2006
_____________________
Charles R. Fulbruge III
No. 04-30060 Clerk
_____________________
ICEE DISTRIBUTORS INC.,
Plaintiff - Appellant-Cross-Appellee
- Cross-Appellant,
versus
J & J SNACK FOODS CORP.; WAL-MART STORES INC.,
Defendants - Appellees-Cross-Appellants
- Cross-Appellees,
ICEE OF AMERICA INC.,
Defendant - Cross-Appellant-Cross-Appellee.
_________________________________________________________________
Appeals from the United States District Court
for the Western District of Louisiana
_________________________________________________________________
Before JOLLY, WIENER, and DENNIS, Circuit Judges.
E. GRADY JOLLY, Circuit Judge:
This case, which involves an allegation of infringement of the
ICEE trademark, was previously before us on an interlocutory
appeal, ICEE Distributors, Inc. v. J&J Snack Foods Corp., 325 F.3d
586 (5th Cir. 2003). We upheld an injunction, solely on breach-of-
contract grounds, against J&J Snack Food Corp. (“J&J”) and Wal-Mart
Stores, Inc. prohibiting them from selling ICEE-marked squeeze
tubes within the territory covered by the exclusive license
agreement between ICEE Distributors, Inc. (“Distributors”) and the
ICEE trademark-owner, ICEE of America (“IOA”). On remand, the
District Court denied Distributors’ motion for reconsideration of
its earlier summary judgment dismissing Distributors’ trademark-
infringement claim and partially granted defendants’ motion to
modify the judgment by narrowing the injunction so as to apply only
to J&J.
In this appeal, Distributors challenges both the District
Court’s grant of summary judgment on the trademark-infringement
claim and the District Court’s modification of the injunction. We
AFFIRM, in part, and REVERSE, in part, the grant of summary
judgment and VACATE the modification of the injunction.
I
Our previous opinion lays out the background of this dispute:
In the 1960s, the John E. Mitchell
Company ("Mitchell Company") developed the
ICEE, a semi-frozen beverage consisting of
carbonated water and syrup mixed together that
stands up when poured into a cup. Through its
subsidiary, ICEEQUIP, the Mitchell Company
owned the trademark rights to the ICEE name on
products such as the cups for holding the
frozen carbonated beverage, the machines for
making the beverage, and the beverage itself.
ICEEQUIP entered into several trademark
licensing agreements with ICEE distributors in
different parts of the country.
[Distributors], by virtue of its purchase of
several regional distributorships that had
each entered into these licensing agreements,
is a party to these identically-worded
2
agreements for its various distribution
territories, which include most of Louisiana
and Arkansas, and parts of Texas, Missouri,
Alabama, and Georgia.
In the 1980s, the Mitchell Company went
out of business. In response, the regional
licensees, including Distributors and The ICEE
Company, a subsidiary of J&J, formed ICEE of
America ("IOA"). Upon execution of an
assignment agreement, IOA acquired the
ownership rights and interests in the
trademarks previously held by ICEEQUIP. Both
Distributors and The ICEE Company own stock in
IOA, with The ICEE Company being the largest
shareholder and Distributors the second
largest.
In 1999, J&J began manufacturing frozen
squeeze-up tubes under the name "ICEE" on a
nationwide basis. Wal-Mart sold these tubes
in its Sam's Club stores. Although J&J
requested permission from Distributors to sell
the tubes in its territory, Distributors
refused. J&J sold the tubes in Distributors’
territory nonetheless. Distributors filed
this suit in May 1999 against J&J and Wal-Mart
for trademark infringement and dilution.
After the case was filed, J&J attempted
unsuccessfully to register with the U.S.
Patent and Trademark Office a trademark for
the use of the ICEE name on the tubes. The
PTO rejected the application on the basis that
the proposed trademark would likely be
confused with IOA's trademarks on the ICEE
beverage, cups, and beverage machine. J&J
then assigned the trademark application to
IOA, which successfully registered the
trademark. IOA's president, Dan Fachner, who
was also the president of J&J's subsidiary The
ICEE Company, then granted J&J a license
[dated February 25, 2000] to use the trademark
in areas including Distributors’ territory.
3
After execution of the licensing
agreement between IOA and J&J, Distributors
added IOA as a defendant, alleging that IOA,
as the assignee of the trademarks previously
held by ICEEQUIP, was bound to the licensing
agreements with Distributors, and had breached
those contracts by entering into the squeeze
tube agreement with J&J. The district court
granted summary judgment in the defendants’
favor on the trademark infringement claim, but
held a trial on the trademark dilution and
breach of contract claims, bifurcating the
liability and damages stages. After the
liability stage of the trial, the jury found
J&J and Wal-Mart liable for willful trademark
dilution and IOA liable for breach of
contract. Based on the jury verdict, the
trial court subsequently entered a permanent
injunction against J&J and Wal-Mart forbidding
the sale of squeeze tubes within Distributors’
territory.
325 F.3d at 589-90.
J&J, Wal-Mart, and IOA immediately filed an interlocutory
appeal seeking to set aside the injunction, which appeal led to the
2003 opinion quoted above. We affirmed the injunction, but solely
on the basis of the breach-of-contract claim. We held that
Distributors’ trademark-dilution claim failed because Distributors
was not the owner of the ICEE trademark and thus did not have
standing to sue under the Federal Trademark Dilution Act. Id. at
597-99. Because our review was limited to the propriety of the
injunction, we remanded to allow further proceedings consistent
with our interlocutory opinion. Thus, once the case had been
remanded, the District Court had before it: first, the damages
4
issue on the breach-of-contract claim against IOA, and, second, the
grant of summary judgment it had earlier entered against
Distributors on the trademark-infringement claim.
On remand, Distributors moved the District Court for
reconsideration of summary judgment based on facts that came to
light post-summary judgment during trial of the trademark-dilution
and breach-of-contract claims. The District Court denied the
motion to reconsider, and Distributors waived its right to a trial
to quantify its damages against IOA on the breach-of-contract
claim. The District Court entered final judgment keeping the
original permanent injunction in force and denying all other
relief. Defendants then moved to vacate and modify the judgment
and moved for a new trial on the breach-of-contract claim. The
District Court denied the motion for new trial, but narrowed the
permanent injunction so as to prohibit J&J, but not Wal-Mart, from
selling the tubes in Distributors’ territory.
Distributors appeals the summary judgment denying the
trademark-infringement claim, the denial of the motion made on
remand to reconsider the summary judgment, and the modification of
the permanent injunction. Defendants cross-appeal the denial of
their motion for retrial.
5
II
A
We first address the District Court’s grant of summary
judgment dismissing Distributors’ trademark-infringement claim. A
grant of summary judgment is reviewed de novo, using the same
standard applied by the District Court. Hall v. Gillman, Inc., 81
F.3d 35, 36 (5th Cir. 1996). “Summary judgment is appropriate only
if there is no genuine issue as to any material fact and . . . the
moving party is entitled to a judgment as a matter of law.” FED.
R. CIV. P. 56(c).
Distributors sued for trademark infringement under 15 U.S.C.
§ 1114:
(1) Any person who shall, without the consent
of the registrant -
(a) use in commerce any
reproduction, counterfeit, copy, or
colorable imitation of a registered
mark in connection with the sale,
offering for sale, distribution, or
advertising of any goods or services
on or in connection with which such
use is likely to cause confusion, or
to cause mistake, or to deceive;
. . .
shall be liable in a civil action by the
registrant for the remedies hereinafter
provided . . . .
6
We considered this provision in Matrix Essentials, Inc. v. Emporium
Drug Mart, Inc. of Lafayette, 988 F.2d 587 (5th Cir. 1993), which
the District Court cited as controlling its analysis. In Matrix
Essentials, a manufacturer (“Matrix”) of specialty hair-care
products sold only at salons licensed to carry the products sued a
retail drug store (“Emporium”) stocking Matrix products on its
shelves, claiming that Emporium’s unauthorized sale of Matrix
products constituted trademark infringement. Matrix relied on two
theories. First, it claimed that Emporium was not selling
“genuine” Matrix products because Emporium sold the products
without the professional consultation supposed to be available to
a customer purchasing Matrix products from a licensed salon.
Second, Matrix contended that Emporium deceived the public into
believing that Matrix had authorized Emporium to sell its products.
We rejected both theories on the ground that “consumer confusion”
is the “linchpin” of trademark infringement analysis, and concluded
that “trademark law does not apply to the sale of genuine goods
bearing a true mark, even if the sale is without the mark-owner’s
consent.” Id. at 590. Consumer confusion could not be established
in Matrix Essentials because the products bearing the mark were
clearly authorized by the holder of the trademark; in fact, the
products were manufactured by Matrix itself. Thus, the mark on the
product properly indicated that Matrix was the ultimate source of
7
the goods, controlling the quality of the product via its control
of the mark, and no consumer confusion was possible. Thus, the
products were “genuine goods bearing a true mark” and their
unauthorized sale could not constitute trademark infringement.
Applying this rule, the District Court, in granting summary
judgment for defendants, held:
[I]t is undisputed that ICEE of America is the
owner of [the trademarks-in-suit] . . . .
J&J’s products are of the same origin and
quality as ICEE Distributors’ products. It is
undisputed that the quality of the products
sold by ICEE Distributors under the trademark
“ICEE” and the quality of the products sold by
J&J through Wal-Mart under the trademark
“ICEE” is controlled by the same trademark
owner, ICEE of America. . . . It is
undisputed that J&J has the “ICEE” mark
owner’s consent to produce and sell frozen
flavored ice products bearing the “ICEE” mark.
Thus, there can be no consumer confusion.
Without consumer confusion, ICEE Distributors
has no claim for trademark infringement.
Memorandum Ruling, June 30, 2000, at 4-5.
Distributors contends that IOA did not, in fact, properly
authorize J&J to use the ICEE mark on the squeeze tubes.
Distributors makes three primary arguments contesting the District
Court’s holding. First, Distributors contends that the license
agreement (“Tube License”) that IOA granted J&J in February 2000
was “void at the outset” as a matter of law because it purported to
grant J&J a right -- namely the right to sell ICEE-marked products
8
in Distributors’ territory -- that IOA no longer had because of its
exclusive license agreement with Distributors. Second,
Distributors argues that, even if IOA had the right to grant such
a license, there are genuine issues of material fact bearing on
whether IOA ever gave authorized consent to J&J to use the ICEE
mark on the tubes; in other words, the grant of the Tube License
was invalid. Third, Distributors urges that, even if the Tube
License was valid when issued, it does not excuse sales made prior
to the execution of the Tube License. We address these arguments
in turn.
B
Distributors maintains that J&J is liable for trademark
infringement because the Tube License was void at the outset as a
matter of law due to the conflict between it and Distributors’
exclusive territorial license, which had been previously granted by
IOA. Distributors relies on the Tenth Circuit opinion in San Juan
Products, Inc. v. San Juan Pools of Kansas, Inc., 849 F.2d 468
(10th Cir. 1988), for the proposition that a license granting
rights already granted exclusively to an earlier licensee is void.
Distributors’ reliance on San Juan Products is unpersuasive.
The ruling in San Juan Products, although generally relevant,
cannot control the instant case because the Tenth Circuit did not
have occasion to decide specifically the effect of the duplicative
9
licensing on a claim of trademark-infringement. Trademark-owner
San Juan Products, Inc. (“San Juan”), a maker of one-piece
fiberglass swimming pools, had granted to Sun N’ Surf exclusive
marketing rights in a broadly defined territory including the state
of Kansas. A few years later, San Juan signed a license agreement
purportedly making San Juan Pools of Kansas, Inc. (“SJK”) the
exclusive dealer in Kansas. After SJK’s license expired, SJK began
selling pools allegedly “splashed” (i.e. copied) from San Juan
models but marked with a different trade name. San Juan sued SJK
for trademark infringement based on SJK’s splashing of its pools.
SJK defended, claiming a breach of the license. Although the Tenth
Circuit did hold, inter alia, that the license agreement between
San Juan and SJK was “void at the outset or voidable at its
instance” because it purported to grant to SJK rights which had
already been granted exclusively to Sun N’ Surf, the court did so
only in the context of explaining the absence of a claim for breach
of the license; i.e. there was no breach because there was no
license. The Tenth Circuit did not uphold a trademark-infringement
claim against SJK based on the invalidity of SJK’s license; in
fact, San Juan’s trademark-infringement claims were rejected
because, according to the court, San Juan had no trademark rights
in Kansas to begin with.
10
Distributors’ argument, extrapolating from the holding of San
Juan Products to find an infringement claim here, expands trademark
law beyond its proper scope. Trademark law is plainly not designed
to protect licensees as such, but instead to protect the public --
i.e., consumers -- from confusion about a product’s source and,
relatedly, to protect trademark-owners’ investment in the goodwill
associated with their marks. See, e.g., Two Pesos v. Taco Cabana,
505 U.S. 763, 774 (1992). Because the rights of a licensee are
derivative of the rights of the trademark-owner,1 a claim of
infringement by a licensee seems impossible to maintain where the
trademark-owner could not bring such a claim. It is common-sense
reasoning that a trademark-owner has no claim of trademark
infringement against a manufacturer that produced approved marked
goods pursuant to an agreement with the mark-owner itself; nor,
then, can a claim of infringement be brought by the prior licensee,
whose interest in its exclusive rights is properly protected by
contract law. Underlying this common-sense reasoning is the well-
founded rule that we recognized in Matrix Essentials discussed
above: so long as the trademark indicates that the mark-owner is
the ultimate source of approval for the marked product, there can
1
Here, Distributors’ license agreement specifically grants the
right to bring infringement actions where the mark-owner fails to
do so.
11
be no consumer confusion and, consequently, no infringement. Put
another way, the fact that a subsequent license breaches the
earlier licensee’s contractual rights does not affect the fact that
the mark-owner/licensor is the ultimate source of the product.
Consequently, “[a]n exclusive licensee does not have a claim for
trademark infringement against a subsequent licensee. The claim
arises instead under inducing breach against the subsequent
licensee and for breach of contract against the licensor.”
McCarthy on Trademarks and Unfair Competition § 25:30 (4th ed.,
2005); see also Ballet Shoe Makers, 633 F.Supp. 1328 (S.D.N.Y.
1986); MJ & Partners Restaurant Ltd. Partnership v. Zadikoff, 10
F.Supp.2d 922, 927 (N.D. Ill. 1998). Here, the Tube License, on
its face, is an exercise of trademark-owner IOA’s control over the
ICEE mark and the quality of goods bearing the ICEE mark.
Notwithstanding the fact that the Tube License may constitute a
breach of Distributors’ license agreement with IOA, a claim of
trademark infringement cannot lie so long as the Tube License
establishes IOA’s control over the squeeze tubes produced by J&J
under the ICEE mark.
We therefore must turn to Distributors’ arguments that genuine
issues of material fact exist as to whether IOA did in fact
authorize J&J to place the ICEE mark on J&J’s squeeze tubes.
C
12
Distributors contends that there exist genuine issues of
material fact as to whether the Tube License was properly approved
by the IOA Board, and thus whether it legally manifests the consent
of IOA. Distributors specifically contends that the trial of the
breach-of-contract and trademark-dilution claims exhibited several
fact issues supporting its contention that the Tube License was not
a valid exercise of directorial control. Distributors argues, for
example, that the Tube License is of questionable validity because
of potential self-dealing: Dan Fachner, who signed the Tube
License as President of IOA, is also the President of The ICEE
Company, a subsidiary of J&J; Gerald S. Shreiber, a member of the
IOA Board, signed the Tube License as J&J’s President; Edward
Steele, a member of the IOA Board, was a former employee of The
ICEE Company. Distributors also argues that proper corporate
procedures for entering into a license agreement were not followed.
A central issue at the trial was whether Fachner executed the Tube
License with the consent of the IOA Board; and the Tube License was
not signed by IOA’s Secretary, Chris Watkins, as allegedly required
by IOA’s corporate by-laws.
These factual contentions, which we will only assume to be
relevant in determining whether the ICEE-marked squeeze tubes were
properly authorized by IOA, were not presented by Distributors to
the District Court when it considered defendants’ motion for
13
summary judgment, which was granted before the first appeal and
remand. Review of a grant of summary judgment is generally limited
to the record before the District Court when it ruled on the
motion. See Abbott v. Equity Group, Inc., 2 F.3d 613, 629 n.56
(5th Cir. 1993); Topalian v. Ehrman, 954 F.2d 1125, 1132 n.10 (5th
Cir. 1992). Distributors, however, moved for reconsideration of
the summary judgment after we remanded the case in 2003.
A denial of a motion for reconsideration is reviewed for an
abuse of discretion. Lake Hill Motors, Inc. v. Jim Bennett Yacht
Sales, Inc., 246 F.3d 752, 757 (5th Cir. 2001). Under
extraordinary circumstances, a court may entertain a motion for
reconsideration in the light of evidence not in the summary
judgment record. See Templet v. Hydrochem, Inc., 367 F.3d 473, 479
(5th Cir. 2004). However, “[a]n unexcused failure to present
evidence available at the time of summary judgment provides a valid
basis for denying a subsequent motion for reconsideration.”
Templet v. Hydrochem, Inc., 367 F.3d 473, 479 (5th Cir. 2004).
Lavespere v. Niagara Machine & Tool Works, Inc., 910 F.2d 167 (5th
Cir. 1990), provides several factors to consider when a party seeks
to upset a summary judgment by producing additional evidence: “(1)
the reasons for the moving party’s default, (2) the importance of
the omitted evidence to the moving party’s case, (3) whether the
evidence was available to the movant before the nonmovant filed the
14
summary judgment motion, and (4) the likelihood that the nonmoving
party will suffer unfair prejudice if the case is reopened.”
Templet, 367 F.3d at 482 (citing Lavespere, 910 F.2d at 174).
“These factors . . . are simply illustrative and not exhaustive. .
. . Rule 59(e) motions provide the district court with
‘considerable discretion.’” Id. at 482-83.
Distributors states, in conclusory fashion, that we may
properly consider the facts it recites. However, we think that the
District Court did not abuse its discretion in denying the motion
to reconsider. Distributors relies on facts that were plainly
available or easily discovered before summary judgment.
Distributors knew about the dual loyalties of the several IOA Board
members and executives who are also executives of J&J or its
subsidiary. The events in question did not occur after summary
judgment; and no reason is offered that knowledge of these events
was beyond Distributors’ reach before then. The District Court
therefore did not abuse its discretion by refusing to consider
Distributors’ newly proffered evidence.
Looking only at the summary judgment record, then, we see
nothing that calls into question the validity of the Tube License,
save for the legal argument that we disposed of in the previous
section. The Tube License clearly granted J&J permission to use
the ICEE trademark in the manufacture of squeeze tubes throughout
15
the country. These products are genuine goods bearing a true mark;
thus, their sale, even in Distributors’ territory, could not
constitute trademark infringement once the Tube License was in
place.
D
We now turn to Distributors’ contention that, even if the Tube
License rendered J&J’s use of the ICEE trademark non-infringing,
there is a genuine issue of material fact as to whether IOA
sanctioned J&J’s use of the ICEE trademark before execution of the
Tube License.
J&J began manufacturing squeeze tubes and selling them in
Distributors’ territory in 1999, but the Tube License was not
executed until February 2000. Distributors argues that the
District Court’s opinion and holding do not excuse J&J’s pre-Tube-
License sales because there was no license granting J&J the right
to use the ICEE mark on its squeeze tubes, i.e., that the mark was
not true because there was no authorization for its use. The
summary judgment opinion and the briefs on appeal indicate that the
Tube License is the only license that purports to give J&J
permission to use the ICEE mark on its squeeze tubes. Therefore,
we agree with Distributors that the District Court’s opinion
granting summary judgment on the trademark-infringement claim does
16
not cover sales in the period before the execution of the Tube
License.
Defendants argued to the District Court, however, that they
had received the IOA Board’s approval first in December 1998
(before sales began) and again in November 1999. Defendants
attached to their Reply Brief on Motion for Summary Judgment an
affidavit (the “Fachner affidavit”) and an exhibit (the “Board
minutes”) consisting of the minutes of the November 1999 IOA Board
Meeting. They point out further that the Tube License contains a
provision attesting to the IOA Board’s past approval of J&J’s use
of the ICEE trademark on squeeze tubes.
We think defendants have not sustained their burden of showing
that no genuine issue of material fact exists. While the Fachner
affidavit does state that Fachner attended the December 1998
meeting and that there were no objections to J&J’s sale of squeeze-
up tubes at that time, it does not state, other than to leave it to
inference, what action the Board took to grant J&J permission to
use the mark. The attached Board minutes, which the Fachner
affidavit cites to support contentions about the December 1998
meeting, are actually from the November 1999 meeting and contain
little to support Fachner’s contention other than Shreiber’s
statement that “J&J believed that tacit approval to sell the tubes
nationwide had been received.” Not only are these statements open
17
to challenge and critical evaluation given that they were made by
the two J&J executives who signed the Tube License (one on behalf
of IOA), there is sufficient evidence to say that the issue was not
taken out of contention. The Board minutes undermine defendants’
position because they show that the IOA Board in November 1999
considered the legal status of the squeeze tubes unsettled. The
Board minutes also show that Dan Ursery, Distributors’
representative, stated in response to Shreiber that he had objected
at the December 1998 meeting. Furthermore, on summary judgment,
Distributors submitted counter affidavits, from Dan Festervan
(Distributors’ President) and Ursery, both of which state that
Distributors had at all times objected to J&J’s sales of squeeze
tubes. These affidavits do not speak to whether a Board vote took
place in 1998, but they do undermine Fachner’s contention that
there were no objections at the December 1998 meeting. We simply
cannot hold that there is no genuine issue of material fact as to
whether the pre-Tube-License manufacture and sale of mark-bearing
squeeze tubes were authorized by IOA. As for the Tube License’s
recitation of a past state of affairs, we find it to be of limited
probative value because the agreement was executed by two J&J
executives after Distributors had filed suit against J&J.
A fact-finder may ultimately determine that J&J did receive
permission from IOA as early as December 1998 to use the ICEE
18
trademark on its squeeze tubes, but we are unable on a review of
the summary judgment record to conclude irrefutably that that was
indeed the case. We therefore hold that there is a genuine issue
of material fact regarding J&J’s permission to place the ICEE
trademark on squeeze tubes prior to execution of the Tube License,
and consequently whether the products sold during that period were
“genuine goods bearing a true mark” or goods that infringed on the
ICEE trademark.
III
We now turn to Distributors’ second ground for appeal. After
we had affirmed the District Court’s injunction prohibiting both
J&J and Wal-Mart from selling the squeeze tubes in Distributors’
territory, the District Court on remand entered final judgment
reflecting that ruling. Defendants moved for modification of the
injunction. The District Court then granted defendants’ request,
narrowing the scope of the injunction to bar sales of ICEE squeeze
tubes only by J&J and not by Wal-Mart. The District Court reasoned
that, because we had held the trademark dilution claim unfounded,
the injunction as previously written could not be supported on
breach-of-contract grounds alone. On appeal, Distributors argues
that the injunction had been affirmed by this court and the mandate
had issued making the decision final; thus, the injunction could
19
only be modified under special circumstances requiring changed law
or facts, neither of which occurred.
A modification of an injunction is reviewed for an abuse of
discretion. Moses v. Washington Parish School Board, 379 F.3d 319,
327 (5th Cir. 2004). Modification of an injunction is appropriate
when the legal or factual circumstances justifying the injunction
have changed. See Black Association of New Orleans Fire Fighters
v. City of New Orleans, 853 F.2d 347, 354 (5th Cir. 1988)
(“Ordinarily, the purpose of a motion to modify an injunction is to
demonstrate that changed circumstances make the continuation of the
order inequitable . . . .” ); Keith v. Mullins, 162 F.3d 539, 541
(8th Cir. 1998) (holding that a district court abuses its
discretion when it modifies an injunction without a showing of a
significant change in circumstances).
We agree with Distributors that the District Court’s
modification was inappropriate. The original injunction was fully
considered and affirmed by this court in the previous appeal, and
the finality of our affirmance of the injunction is not in
question. Defendants passed an opportunity in the previous appeal
-- and certainly on petition for rehearing, which was not pursued
-- to argue that upholding the allegedly over-broad injunction was
inappropriate given our reversal of the trademark-dilution verdict.
Moreover, as we noted in our opinion, “J&J and Wal-Mart [did] not
20
argue that the injunction, based on IOA’s breach of contract, is
unenforceable as to them under Federal Rule of Civil Procedure
65(d) . . . . Therefore this argument is waived.” 325 F.3d at 597
n.33. The District Court was not at liberty to modify the
injunction except on a proper showing of a change of circumstances.
Defendants contend that the District Court did indeed properly
rely on changed circumstances, namely, the legal basis of the
District Court’s injunction had changed in the light of our ruling
that the trademark dilution verdict -- on which the injunction was
partially based -- could not be sustained. The District Court
reasoned that this court’s ruling upholding only the breach-of-
contract claim undermined the applicability of the injunction to
any party beyond J&J. This argument, however, disregards the fact
that we specifically held in our previous opinion that the breach-
of-contract verdict supported the original injunction. 325 F.3d at
599 (“[W]e will not reverse the trial court’s grant of injunction
because it is independently sustainable as a proper remedy for
breach of contract.”). We did not suggest otherwise or remand for
modification of the injunction in the light of our ruling. Our
ruling, affirming the original injunction on breach-of-contract
grounds alone, cannot be an appropriate basis for the district
court’s conclusion that the original injunction should not be
21
sustained because only the breach-of-contract grounds survived the
earlier appeal.
Therefore, we find that the District Court abused its
discretion in modifying the injunction, and we accordingly vacate
the modification, and remand to allow the District Court to
reinstate the original injunction.
IV
For the foregoing reasons, the order of the District Court
granting summary judgment in favor of defendants is AFFIRMED, in
part, and REVERSED, in part, and the modification of the injunction
previously affirmed by this court is VACATED. We REMAND to the
District Court for further proceedings consistent with this
opinion.
22