Some people have all the luck in the Eastern District of New York. Whereas me — I think I’ve got it coming to me right down the middle, and then it seems to get, I don’t know — diverted from me!
So some lawyers get assigned judges in the Eastern District of New York whose ideas about trademark law and, well, the Federal Rules of Evidence — and, actually, the Federal Rules of Civil Procedure have, well, um . . . okay, I won’t say. But in their courtrooms this is the kind of thing happens to “unauthorized resellers,” regardless of the actual “law” stuff.
I know, regular readers are sick of hearing about the S&L case, but I’m just framing the story here, okay? Stick with me.
And then there are other judges in that same court who actually not only get it, but really, really, really get it: There’s no such thing as “diversion” of authentic, untainted merchandise by “unauthorized” resale on the Internet. Whether or not the manufacuter of a product thinks you need a whole two years of community college or that certificate from beauty school to slather on hair goop or tanning sludge, that preference does not “run with” the over-hyped blech they sell.
No, go THIS store!
So — still setting the stage here, stay with me! — Judge Leonard Wexler, in 2007, went this far to make that point, as reported here exactly two year agos from tomorrow:
L’OrÃ©al maintains that to keep the value, integrity and status of the products, they are supposed to be sold only by company-trained professionals in fashionable salons. Matrix alone “has been the number one professional hair brand on the market, with an estimated 16 percent market share,” L’OrÃ©al said in court papers.
Quality King and Pro’s Choice, however, were obtaining the products in violation of the injunction by buying them, or, as it is called, diverting them, from middlemen and reselling them to nonqualified dealers, L’OrÃ©al contended.
In his opinion, Wexler declined to enforce the old injunction, in effect, throwing out L’OrÃ©al’s case against the two companies.
The judge said that if L’OrÃ©al wanted seriously “to stop diversion of Matrix products,” it could terminate those of its distributors who are the sources of the diverted products.
He actually declined to enforce the old injunction, did Judge Wexler, because it would have actually been, well, wrong to! Because of the law stuff.
Isn’t that enough mazal for Quality King? Can’t some other lawyers in other courtrooms in that District have some of that good fortune?
No! Evidently, on appeal of the earlier decision, the Second Circuit affirmed his vacatur (cancellation) of the injunction going forward, but remanded for further determination of whether the injunction should be not only — not “only”! — vacated, but also “terminated,” i.e., retroactively time-traveled into non-ever-existence.
So once more comes Matrix, the plaintiff, and with them this time big guns from the collossal Weil Gotshal, a real New York law firm this time. So, was it a good idea to spend a good 50% more on fees (not to mention their markup on donuts!) to make the same arguments? Read More…