United States District Court, S.D. Indiana, Indianapolis Division
BRITT INTERACTIVE LLC an Indiana limited liability company, TOWNEPOST NETWORK INC. an Indiana corporation, Plaintiffs,
A3 MEDIA LLC an Indiana limited liability company, COLLECTIVE PUBLISHING LLC an Indiana limited liability company, YELENA LUCAS, NEIL LUCAS, JANELLE MORRISON, Defendants.
ENTRY ON PENDING MOTIONS
WALTON PRATT, JUDGE
matter is before the Court on Plaintiffs Britt Interactive,
LLC's (“Britt Interactive”) and TownePost
Network, Inc.'s (“TownePost”) (collectively
“Plaintiffs”) Motion to Extend Temporary
Restraining Order (“TRO”) (Filing No.
11) and Defendants A3 Media, LLC (“A3
Media”), Neil Lucas, Lena Lucas and Collective
Publishing, LLC (“Collective Publishing”)
(collectively “Defendants”) Emergency Motion for
Extension of Time to File Response. (Filing No. 20).
For the reasons stated below Plaintiffs' Motion to Extend
the Temporary Restraining Order is granted and
Defendants' Motion for Extension of Time to File Response
is granted in part and denied in part.
October 17, 2016, a Hamilton Superior Court judge granted
Plaintiffs' TRO motion, finding that Plaintiffs would
suffer irreparable harm if Defendants A3 Media, Neil Lucas,
Lena Lucas and Collective Publishing were to distribute any
subsequent issues of “Zionsville Magazine” or
“Carmel Magazine.” The TRO expires October 31,
2016 at 3:55pm. Plaintiffs seek to extend the TRO, asserting
that they will suffer immediate and irreparable harm if the
TRO is not extended until the date of the Preliminary
Injunction hearing. Defendants were given until October 31,
2016 at 10:00 a.m. to respond to Plaintiff's motion.
Defendants failed to file a timely response, however at 12:14
p.m., a belated motion for extension of time to respond was
recitation of the background facts set forth in the state
court record is instructive. Tom Britt (“Mr.
Britt”) founded Britt Interactive in 2003. (Filing
No. 3-4 at 8.) Britt Interactive published a monthly
newsletter and magazine, known as Geist Community Newsletter,
as well as a website, atGeist.com. Id. Britt
Interactive also sold licenses to third-parties to use its
methods, techniques, intellectual property, and system to
produce monthly publications in designated territories.
Id. On December 21, 2012 and October 17, 2013,
respectively, Britt Interactive entered into a License
Agreement with A3 Media, operated by Neil and Lena Lucas, to
produce monthly local publications in Zionsville and Carmel,
Indiana. Id. at 8-9. The magazines were known as
“Zionsville Community Newsletter” and
“Carmel Community Newsletter” (collectively the
“magazines”). Id. at 9. Under the
License Agreements, Britt Interactive retained ownership of
the magazines, as well as their website domains,
“atCarmel.com.” Id. Britt interactive
also retained the naming rights of the magazines and domains,
as well as, ownership of the business processes, customer
data, intellectual property and design. Id. at 9-10.
A3 Media was not permitted to modify the design or change the
name of the magazine in any manner unless Britt Interactive
gave written approval. Id. at 9.
2014, Mr. Britt established TownePost Network, which acquired
all of Britt Interactive's intellectual property and
License Agreements. Id. at 11. On February 1, 2014,
Britt Interactive and TownePost informed Britt
Interactive's Licensees that customers and Licensees
should submit fees and payments to TownePost. Id. A3
Media, as well as other licensees, submitted management fees,
page layout fees, as well as all other fees and cost, to
21, 2015, TownePost informed the Licensees that the names and
logos of the publications would change from
“newsletter” to “magazine.”
Id. at 13. A3 Media's magazines changed from
“Zionsville Community Newsletter” and
“Carmel Community Newsletter” to
“Zionsville Magazine” and “Carmel
Magazine.” Id. On July 11, 2016, TownePost
also informed A3 Media, as well as other Licensees, that it
was converting to the franchise model, and offered to sale
franchises as opposed to licenses. Id. at 14. The
pertinent clause in the A3 Media's agreement states,
“[i]n the event that Britt chooses to transform the
licensees to franchisees, Licensee will be given the
opportunity to purchase the territory franchise for
$1.00.” Id. If a Licensee did not want to
become a TownePost Network franchisee, then TownePost would
buy out the Licensee pursuant to the Licensee Agreement.
and Lena Lucas did not inform Mr. Britt whether A3 Media
would become a franchisee or select the buy-out option.
Id. However, on August 8, 2016, A3 Media applied for
state trademarks for the names “Zionsville
Magazine” and “Carmel Magazine.”
Id. at 13. On August 24, 2016, Lena Lucas solicited
quotes from printing companies. Id. at 16. Lena
Lucas then contacted several TownePost customers informing
them to cancel agreements with TownePost and to make all
checks payable to A3 Media rather than to TownePost.
Id. at 16-17. On September 15, 2016, customers
contacted TownePost regarding A3 Media's decision to
abandon TownePost's license. Id. at 14. On
September 20, 2016, A3 Media sent a letter to TownePost,
terminating services. Id. at 18. That same day, Lena
Lucas sent an email to 4, 038 customers informing them of her
change in email. Id. Thereafter, several customers
contacted Mr. Britt, asserting that they were confused
regarding which magazine they may advertise in and which
company they should pay. Id. at 19.
September 23, 2016, Plaintiffs filed a Complaint and Motion
for Preliminary Injunction in the Hamilton Superior Court 3
(“Superior Court”) against the Defendants,
asserting tortious interference with contracts, tortious
interference with business relationships, conversion,
trademark infringement, trademark infringement pursuant to
the Lanham Act, violations of Indiana trademark act, and
breach of contract. (Filing No. 3-2 at 13-22;
Filing No. 3-3 at 3-7.) A3 Media continued
publishing and distributing the magazines under the names
“Zionsville Magazine” and “Carmel
Magazine.” (Filing No. 3-3 at 63-65, 68-70;
Filing No. 3-4 at 22.) Thereafter, on October 11,
2016, Plaintiffs filed an Amended Complaint and a TRO Motion.
(Filing No. 3-4 at 7-42; Filing No. 3-3 at
43-50.) On October 17, 2016, the Superior Court held a
hearing and granted Plaintiffs' TRO, restraining and
enjoining Defendants from distributing October issues, and
any subsequent issues of the magazines, as well as,
interfering with the contracts between TownePost and its
advertisers, among other things. (Filing No. 14.) On
October 21, 2016, Defendants removed the case to federal
court pursuant to 28 U.S.C. §§ 1441 and 1446.
(Filing No. 3.) The Plaintiffs now seek to extend
the TRO, which expires on October 31, 2016 at 3:55pm,
asserting that there is a continued risk of irreparable harm
to Plaintiffs if the TRO is not extended until
Plaintiffs' Motion for Preliminary Injunction hearing.
(Filing No. 11.) The Plaintiffs also filed a Motion
to Hold Defendants in Contempt for Violating the TRO.
(Filing No. 17.) As stated earlier, Defendants
failed to file a timely response, instead they have filed an
Emergency Motion for Extension of Time to File Response.
(Filing No. 20).
to Federal Rule of Civil Procedure 65, a TRO “expires
at the time after entry--not to exceed 14 days-- that the
court sets, unless before that time the court, for good
cause, extends it for a like period or the adverse party
consents to a longer extension.” Fed.R.Civ.P. 65(b)(2).
The reasons for an extension must be entered in the record.
Id. Where parties to a TRO have notice and an
opportunity to be heard, the only question presented is
whether there is good cause to extend the TRO. Merrill
Lynch, Pierce, Fenner & Smith, Inc. v. Patinkin, No.
91 C 2324, 1991 WL 83163, at *3 (N.D. Ill. May 9, 1991). A
TRO is generally limited to one extension and a maximum
duration of 28 days. H-D Mich., LLC v. Hellenic Duty Free
Shops S.A., 694 F.3d 827, 844 (7th Cir. 2012). However,
“where a court expressly extends a TRO issued after
notice and a hearing beyond the [28 day] statutory limit, the
TRO does not cease to exist but instead becomes an
enforceable preliminary injunction subject to appellate
review. Id. at 844-45 (citing Sampson v.
Murray, 415 U.S. 61, 86-88 (1974).
request the Court to extend the TRO and hold Defendants in
contempt, asserting that Defendants violated the TRO and
continue to irreparably harm Plaintiffs. As a preliminary
matter, Plaintiffs' Motion to hold Defendants in contempt
(Filing No. 17) is referred to Magistrate Judge
Dinsmore. The parties should establish a briefing schedule
regarding the contempt Motion when meeting with Judge
Dinsmore on November 3, 2016.
the TRO, Plaintiffs argue that the facts and circumstances
remain the same, and if Defendants are permitted to publish
and distribute their versions of the magazines, Plaintiffs
will suffer harm. “Good cause” may be established
by showing that the grounds for originally granting the TRO
continue to exist. Patinkin, 1991 WL 83163, at *3
(citing Merrill Lynch v. Bradley, 756 F.2d 1048 (4th Cir.