World Wrestling Entertainment, Inc. v. Unidentified Parties

     Case: 14-30489           Document: 00512825187   Page: 1   Date Filed: 11/04/2014




           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT
                                                                        United States Court of Appeals
                                                                                 Fifth Circuit


                                      No. 14-30489                             FILED
                                    Summary Calendar                    November 4, 2014
                                                                          Lyle W. Cayce
                                                                               Clerk
WORLD WRESTLING ENTERTAINMENT, INCORPORATED,

                                                Plaintiff - Appellant
v.

UNIDENTIFIED PARTIES,

                                                Defendant - Appellee




                    Appeal from the United States District Court
                       for the Eastern District of Louisiana
                              USDC No. 2:14-CV-688


Before HIGGINBOTHAM, JONES, and HIGGINSON, Circuit Judges.
PER CURIAM:
      World Wrestling Entertainment, Inc. (“WWE”), seeks ex parte seizure
and temporary restraining orders against unnamed Defendants under the ex
parte seizure provision of the Trademark Counterfeiting Act (the “Act”). 1 The
district court denied relief and certified its order for interlocutory appeal
pursuant to 28 U.S.C. § 1292(b). We allowed appeal and now VACATE the
order of the district court and REMAND for further proceedings consistent
with this opinion.



      1   15 U.S.C. § 1116.
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                                                I.
       WWE presented evidence establishing that it owns many valuable
trademarks and earns significant revenues from the sale of merchandise
bearing those marks at live WWE events across the country. The evidence
further established that WWE can readily identify the unauthorized designs
of counterfeit merchandise and that WWE makes its own merchandise sales
directly—it does not license third parties to sell merchandise at live events.
WWE alleges that Defendants work as “fly-by-night” counterfeiters, setting up
shop near WWE events and cannibalizing WWE’s merchandise sales by
purveying unauthorized products. As the district court acknowledged, WWE
faces a real threat from such counterfeiters who, upon detection and notice of
suit, disappear without a trace and hide or destroy evidence, only to reappear
later at the next WWE event down the road. This is the very nature of the “fly-
by-night” bootlegging industry.
       WWE brought suit in the district court seeking ex parte seizure and
temporary restraining orders under the ex parte seizure provision of the Act. 2
The district court denied relief, concluding that WWE had not proved “specific
facts” about the identities of “person[s] against whom seizure would be
ordered.” 3 Without knowing the identities of persons against whom seizure



       2  Id. at § 1116(d).
       3  Section 1116(d)(4) provides:
        The court shall not grant [a seizure application] unless . . . the court finds that
it clearly appears from specific facts that—
        (i) an order other than an ex parte seizure order is not adequate to achieve the
        purposes of section 1114 of this title;
        (ii) the applicant has not publicized the requested seizure;
        (iii) the applicant is likely to succeed in showing that the person against whom
        seizure would be ordered used a counterfeit mark in connection with the sale,
        offering for sale, or distribution of goods or services;
        (iv) an immediate and irreparable injury will occur if such seizure is not
        ordered;
        (v) the matter to be seized will be located at the place identified in the
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would be ordered, the district court thought it was unable to evaluate WWE’s
likelihood of success in showing such persons had used a counterfeit mark,
whether the harm to WWE outweighed the harm to such persons, or whether
such persons would destroy or make inaccessible the infringing goods upon
notice. The district court applied similar reasoning in denying WWE’s request
for a temporary restraining order.
                                           II.
      The district court’s granular focus on the “identity” of unnamed
Defendants misinterpreted the statutory requirement and its application here.
The district court is correct that ex parte seizure orders should not be granted
at will, and it commendably gave the requirements careful attention. It is the
case that the Act constrains the issuance of such orders with certain procedural
protections for the persons against whom they are issued. The district court
concluded that it could not, ex ante, identify the persons against whom orders
would issue as required by section 1116(d), an appropriate concern but one not
present on the specific facts here.
      The district court’s concern overlooks a predicate established in this case:
WWE does not license third parties to sell merchandise at live events. Rather,
it makes its own merchandise sales directly. The resulting confined universe
of authorized sellers of WWE merchandise necessarily “identifies” any non-
WWE seller as a counterfeiter. WWE cannot know in advance the specific
identities of counterfeiters who will present themselves at any given event, but



      application;
      (vi) the harm to the applicant of denying the application outweighs the harm
      to the legitimate interests of the person against whom seizure would be ordered
      of granting the application; and
      (vii) the person against whom seizure would be ordered, or persons acting in
      concert with such person, would destroy . . . or otherwise make such matter
      inaccessible to the court, if the applicant were to proceed on notice to such
      person.
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it does know that any non-affiliated seller at or near an event is almost
certainly a counterfeiter. 4 In this case, therefore, the “person[s] against whom
seizure would be ordered” are readily identifiable as any non-affiliated person
purporting to sell WWE merchandise at or near a live WWE event. Provided
that observation of unauthorized sales themselves is sufficient to identify a
counterfeiter, as in this case, we see no reason why the district court cannot
evaluate the requirements for ex parte seizure and temporary restraining
orders to issue. We conclude from the record that WWE has met its burden
under section 1116(d), and that the orders sought here should issue.
                                               III.
       As a final matter, the district court understandably expressed concern
about a provision of the proposed order purporting to deputize private
citizens—namely, WWE’s “Enforcement Officials”—to undertake work more
properly the province of law enforcement officers, but it did not reach the issue.
On its face, the Act does not appear to authorize private citizens to carry out
ex parte seizure orders. 5 Indeed, the Act’s sponsors appear to suggest that a
court granting such an order might “permit a representative of the applicant,
such as its counsel, to accompany the U.S. Marshal [or other law enforcement
officer] to assist” in determining what materials should be seized. 6 We do not



       4   One may ask about a person who legally purchased merchandise bearing a valid
trademark and subsequently ventured into the area surrounding a WWE event to resell that
merchandise. The ex parte seizure order sought here would not authorize seizure of such
merchandise, presenting a risk that the party enforcing the order might mistakenly identify
the reseller as a counterfeiter. But, as presented, WWE can readily identify the unauthorized
designs of counterfeit merchandise, and the Act’s wrongful seizure provisions would entitle
the harmed reseller to a cause of action for any damages. See 15 U.S.C. § 1116(d)(11).
        5 See id. at § 1116(d)(9) (“The court shall order that service of a copy of the order . . .

shall be made by a Federal law enforcement officer . . . [or] a State or local law enforcement
officer.”).
        6 Joint Congressional Statement on Trademark Counterfeiting Legislation, 130 Cong.

Rec. H12076, H12082 (1984), reprinted in 7 McCarthy on Trademarks, App’x A8 (4th ed.
1994).
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address the validity of this provision of the proposed order, leaving it to the
district court to address in the first instance. The district court is free to modify
the proposed order or to draft its own order as it sees fit, consistent with the ex
parte seizure provision of the Act and with this opinion.
      Accordingly, the order of the district court is VACATED, and this case
REMANDED for further proceedings consistent with this opinion.




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