United States District Court, District of Columbia
PALETERIA LA MICHOACANA, INC. et al., Plaintiffs & Counter-Defendants,
PRODUCTOS LACTEOS TOCUMBO S.A. DE C.V., Defendant & Counter-Claimant. Re Document Nos. 336, 340, 345, 346, 350, 351, 358
OPINION GRANTING PLAINTIFFS' MOTION TO SUBSTITUTE AND
JOIN SUCCESSOR IN INTEREST; DENYING PLAINTIFFS' MOTION TO
AMEND THE JUDGMENT; DENYING DEFENDANT'S MOTION FOR NEW
TRIAL; DENYING DEFENDANT'S MOTION TO AMEND FINDINGS AND
TO AMEND THE JUDGMENT; GRANTING PLAINTIFFS' OPPOSITION
AND OBJECTIONS TO DEFENDANT'S BILL OF COSTS, CONSTRUED AS
A MOTION; GRANTING IN PART AND DENYING IN PART
DEFENDANT'S MOTION FOR LEAVE TO FILE SURREPLY; DENYING
DEFENDANT'S REQUEST FOR HEARING
RUDOLPH CONTRERAS, United States District Judge.
case arises from the long-running dispute between
Plaintiffs/Counter-Defendants Paleteria La Michoacana, Inc.
and Paleteria La Michoacana (Sub), Inc. (collectively,
“PLM”)and Defendant/Counter-Claimant Productos
Lacteos Tocumbo S.A. De C.V. (“PROLACTO”).
Specifically, this litigation concerns the parties'
rights to use various registered and unregistered trademarks
when selling frozen confections in the United States.
resolving a number of preliminary issues, the Court conducted
a bench trial over the course of thirteen days beginning on
September 14, 2015 and ending on October 1, 2015. On May 27,
2016, the Court issued extensive Findings of Facts and
Conclusions of Law resolving the remaining issues in the
case. After trial, the parties filed a number of post-trial
reasons explained more fully below, the Court will grant
PLM's motion to substitute another PLM-related entity as
the sole Plaintiff in this action and join that same entity
as an additional Counter-Defendant. The Court will also deny
each parties' request to amend the findings and judgment
and deny PROLACTO's motion for a new trial. Finally, upon
consideration of PROLACTO's bill of costs and PLM's
opposition, the Court will order both parties to bear their
FACTUAL AND PROCEDURAL BACKGROUND
Court's previous Findings of Fact and Conclusions of Law
set for the factual and procedural history of this case in
detail. See generally Paleteria La Michoacana, Inc. v.
Productos Lacteos Tocumbo S.A. DE C.V. (PLM
VI), 188 F.Supp.3d 22 (D.D.C. 2016).The Court assumes
the parties' familiarity with the background set forth in
its earlier opinion. Nevertheless, the Court will briefly
summarize the facts and procedural posture of this case, as
described in the Court's previous opinion. See Id
. For clarity, the Court will address the facts relevant
to the pending post-trial motions in the context of each of
the specific motions.
Brief Factual Overview
PROLACTO are in the business of manufacturing and selling
“paletas” and other frozen treats. Paletas are a
style of ice cream bars and popsicles originating in Mexico
that are traditionally made from fruit, spices, and nuts.
is a Mexican company that the Andrade Malfavon family founded
in 1992. The Andrade Malfavon family continues to own
PROLACTO. The company traces its history to Tocumbo, a city
in the Mexican state of Michoacán, in the 1940s, which
is the purported origin of the paleta and the shops, known as
“paleterias, ” that make and sell
them. PROLACTO primarily does business in the
United States through licensing agreements with various
members of the Andrade Malfavon family who own and operate
individual paleterias in certain markets, namely, Florida,
Texas, Northern California, and North Carolina. Until
relatively recently, PROLACTO did not directly own any
paleterias in the United States or otherwise directly sell
its products to any consumers in the United States.
traces its history to at least as early as 1991, when two
brothers, Mexican immigrants Ignacio Gutierrez and Ruben
Gutierrez, began selling paletas out of pushcarts in Northern
California using the name “La Michoacana.” That
name literally means “the woman from the state of
Michoacan” in Spanish. The partnership dissolved in
1999, and Ignacio Gutierrez operated the business as a sole
proprietorship for several years before incorporating in
California. PLM's business has grown significantly since
its beginnings as a pushcart operation in Northern
California. PLM currently manufactures its products in a
factory in Modesto, California and distributes its products
throughout various parts of the United States. PLM
distributes its products to large-scale retailers such as
Costco, Wal-Mart, and Walgreens, as well as Hispanic grocery
stores such as El Super and Vallarta and a variety of other
PLM and PROLACTO use a variety of trademarks when selling
their products in the United States. This litigation concerns
the dispute between PLM and PROLACTO over the right to use
those marks. The parties sharply dispute, among many other
things, which of them first used those marks in the United
States, and each party accuses the other of engaging in bad
faith in a variety of different ways.
Brief Procedural History
procedural history of this matter spans roughly a decade. The
Court briefly restates that history here. See also PLM
VI, 188 F.Supp.3d at 28 (setting forth procedural
dispute began in earnest in 2007 when PROLACTO filed a
petition with the Trademark Trial and Appeal Board
(“TTAB”), a body of the United States Patent and
Trademark Office (“USPTO”), to cancel PLM's
U.S. Registration No. 3, 210, 304 for the mark titled
“LA INDITA MICHOACANA.” See Pet.
Cancellation, TTAB Dkt. 1. On May 20, 2011, the TTAB granted
PROLACTO's petition for cancellation of PLM's LA
INDITA MICHOACANA mark, concluding that PROLACTO had
established priority of use and likelihood of confusion with
respect to several of its asserted, unregistered marks.
See generally Productos Lacteos Tocumbo S.A. De C.V. v.
Paleteria La Michoacana, Inc., 98 U.S.P.Q.2d 1921
(T.T.A.B. 2011). The TTAB denied PLM's motion for
reconsideration on July 13, 2011. See TTAB Dkt. 115.
brought this action pursuant to the Lanham Act, 15 U.S.C.
§ 1071(b), on September 8, 2011. See Compl.,
ECF No. 1. The operative Complaint is now the Second Amended
Complaint, which was filed on June 11, 2012. See 2d
Am. Compl., ECF No. 40. PLM's Second Amended Complaint
alleges four causes of action: Count I seeks reversal of the
TTAB's decision to cancel the registration of PLM's
LA INDITA MICHOACANA mark and denial of PROLACTO's
cancellation petition; Count II seeks a declaration that
there is no likelihood of confusion between PLM's LA
INDITA MICHOACANA mark and various marks asserted by PROLACTO
on the basis of their common usage of the word
“MICHOACANA”; Count III alleges that
PROLACTO's use of its Indian Girl mark infringes three of
PLM's registered marks under 15 U.S.C. § 1114,
including its LA INDITA MICHOACANA mark; and Count IV seeks
to cancel PROLACTO's registration of certain marks
containing the name “LA FLOR DE MICHOACAN” if a
likelihood of confusion is found between those marks and
PLM's marks. See 2d Am. Compl. ¶¶
in turn, filed seven counterclaims. Specifically,
Counterclaim Count I alleges that PLM infringed
PROLACTO's registered LA FLOR DE MICHOACAN and design
mark under 15 U.S.C. § 1114(1); Counterclaim Count II
alleges trademark infringement, unfair competition, passing
off, false advertising, false association, and false
designation in violation of 15 U.S.C. § 1125(a);
Counterclaim Count III alleges trademark infringement of the
District of Columbia's common law; Counterclaim Count IV
alleges trademark dilution under 15 U.S.C. § 1125(c);
and Counterclaim Counts V, VI, and VII seek cancellation of
two of PLM's registered marks due to fraud and
abandonment. See Ans. 2d Am. Compl. &
Countercls. ¶¶ 39-87, ECF No. 41.
parties filed cross-motions for summary judgment after the
close of discovery and the Court granted in part and denied
in part both motions. See generally Paleteria La
Michoacana, Inc. v. Productos Lacteos Tocumbo S.A. De
C.V. (PLM IV), 69 F.Supp.3d 175 (D.D.C. 2014).
The Court then granted in part and denied in part PLM's
motion to revise that Memorandum Opinion and Order,
see Mem. & Order, ECF No. 174, and denied
PROLACTO's motion for reconsideration, see Paleteria
La Michoacana, Inc. v. Productos Lacteos Tocumbo S.A. De
C.V. (PLM V), 79 F.Supp.3d 60 (D.D.C. 2015).
The Court issued a First Revised Order on February 3, 2015.
See First Revised Order, ECF No. 175.
Court's Findings of Fact and Conclusions of law set forth
in detail which claims and counterclaims survived summary
judgment. See PLM VI, 188 F.Supp.3d at 30. In brief,
the Court denied summary judgment to both parties on Count I
of PLM's Second Amended Complaint and neither party
sought summary judgment on Counts II, III, and IV.
Id. Turning to PROLACTO's counterclaims, the
Court granted summary judgment in favor of PLM on
Counterclaim Counts I, III, IV, V, VI, and VII. Id.
at 30-31. With regard to the claims under trademark
infringement, false designation of origin, passing off, and
unfair competition in Counterclaim Count II, the Court
entered partial judgment in favor of PLM limiting this claim
to the Houston, Texas market and denied summary judgment to
both parties as to whether PROLACTO has established secondary
meaning for its marks. Id. at 30. The Court also
resolved a number of issues related to the false advertising
claims found in Counterclaim Count II, but left others to be
resolved at trial. Id. at 30-31.
the Court narrowed the issues through summary judgment, the
case proceeded to trial. The bench trial took place over
thirteen days between September 14, 2015 and October 1, 2015.
After considering the parties proposed findings of fact and
conclusions of law, as well as other motions filed during or
after the trial, the Court issued its extensive Findings of
Fact and Conclusions of Law. See generally PLM VI,
188 F.Supp.3d 22. In brief, the Court entered judgment in
favor of PROLACTO as to Count I of PLM's Second Amended
Complaint and entered judgment in favor of PLM as to Counts
II and III. The Court dismissed Count VI as moot. Finally,
the Court entered judgment in favor of PLM as to
PROLACTO's Counterclaim Count II.
Motions Pending Before the Court
the trial, but shortly before the Court issued its Findings
of Fact and Conclusions of Law, PLM filed a motion to
substitute a PLM-related entity as the sole Plaintiff and to
add that entity as an additional Counter-Defendant because of
the transfer of the marks at issue in this case. See
generally Pls.' Mot. Sub. & Join Successor in
Interest (“PLM Mot. Sub.”), ECF No. 336. After
the Court issued its Findings of Fact and Conclusions of Law,
PLM filed a motion to alter or amend the Court's judgment
on Complaint Count I that affirmed the cancellation of
PLM's U.S. Registration No. 3, 210, 304. See
generally Pls.' Mot. Amend J. (“PLM's Mot.
Amend”), ECF No. 340. After briefing on that motion,
PROLACTO filed a motion seeking leave to file a surreply to
address issues raised in PLM's reply brief. See
Def.'s Mot. Leave File Surreply or, in the Alternative,
Mot. Strike (“PROLACTO's Mot. Surreply”), ECF
No. 351. PROLACTO filed a motion for a new trial based on the
discovery of PLM's registration and ownership of the
domain name “laflordemichoacan.com, ” see
generally Def.'s Mot. New Trial
(“PROLACTO's Mot. New Trial”), ECF No. 345,
and a motion to amend the Court's findings and legal
conclusions with regard to the incontestability of PLM's
Indian Girl Design marks, see generally Def.'s
Mot. Amend Findings & Amend J. (“PROLACTO's
Mot. Amend”), ECF No. 346. PROLACTO also filed a bill
of costs, see generally PROLACTO's Bill of
Costs, ECF No. 343, which PLM objected to, see
generally Pls.' Opp'n & Objs. Def.'s
Bill of Costs (“PLM's Opp'n Bill of
Costs”), ECF No. 350.
the close of briefing on its motion for a new trial and its
motion to amend, PROLACTO requested a hearing to address the
pending motions. See Def.'s Req. Hr'g, ECF
No. 358. PROLACTO argues that “oral argument may assist
the Court in evaluating PROLACTO's” motions.
Def.'s Req. Hr'g ¶ 9. PLM responds that it
“do[es] not believe that a hearing is necessary.”
See Pls.' Resp. Def.'s Req. Hr'g at 1-2,
ECF No. 359. Nevertheless, PLM requests that the Court also
hear oral argument on PLM's motion to amend if it decides
to grant a hearing. See Pls.' Resp. Def.'s
Req. Hr'g at 1-2. The allowance of oral argument is
“within the discretion of the Court.”
See LCvR 7(f). The Court finds that there is no need
for oral argument on the motions. The parties have briefed
the pending motions extensively and the written arguments
provide a sufficient basis for the Court to rule. The Court
therefore denies PROLACTO's request for a hearing.
PLM'S MOTION TO SUBSTITUTE PARTIES
Court first turns to PLM's motion pursuant to Federal
Rule of Civil Procedure 25(c) to substitute PLM Operations,
LLC (“PLM Operations”) as the sole Plaintiff and
to join that entity as an additional Counter-Defendant.
See generally PLM Mot. Sub. PROLACTO opposes the
motion to substitute and join PLM Operations. See
generally Def.'s Opp'n Pls.' Mot. Sub. &
Join Successor in Interest (“PROLACTO's Opp'n
Mot. Sub.”), ECF No. 341. For the reasons set forth
below, the Court will grant PLM's motion, substitute PLM
Operations as the sole Plaintiff, and join the same entity as
an additional Counter-Defendant.
Rule of Civil Procedure 25(c) provides that, “[i]f an
interest is transferred, the action may be continued by or
against the original party unless the court, on motion,
orders the transferee to be substituted in the action or
joined with the original party.” Fed.R.Civ.P. 25(c).
The decision to grant or deny a Rule 25(c) motion is a matter
within the district court's discretion. See Burka v.
Aetna Life Ins. Co., 87 F.3d 478, 482 (D.C. Cir. 1996);
see also Bauer v. Commerce Union Bank, 859 F.2d 438,
441 (6th Cir. 1988) (“[O]rders [granting Rule 25(c)
substitution] are reviewed only for abuse of
discretion.”), cert. denied, 489 U.S. 1079
(1989); Prop-Jets, Inc. v. Chandler, 575 F.2d 1322,
1324 (10th Cir. 1978) (“Substitution of a successor in
interest or its joinder as an additional party under Rule
25(c) is generally within the sound discretion of the trial
primary basis for deciding the motion is whether substitution
would “facilitate the conduct of the litigation.”
Comm'ns Imp. Exp., S.A. v. Republic of Congo,
118 F.Supp.3d 220, 231 (D.D.C. 2015) (quoting Citibank v.
Grupo Cupey, Inc., 382 F.3d 29, 32 (1st Cir. 2004));
see also 7C Charles Wright & Arthur Miller,
Federal Practice & Procedure § 1958 (3d ed.
2016) (noting the trial court's discretion). This focus
on “considerations of convenience and economy . . .
prevails because Rule 25(c) has no bearing on the substantive
relationship between the parties.” Comm'ns Imp.
Exp., 118 F.Supp.3d at 231. Regardless of the transfer
in interest and subsequent substitution, “[t]he merits
of the case . . . are still determined vis-à-vis the
originally named parties.” Minn. Mining & Mfg.
Co. v. Eco Chem, Inc., 757 F.2d 1256, 1263 (Fed. Cir.
1985); see also In re Covington Grain Co., Inc., 638
F.2d 1362, 1364 (5th Cir. 1981) (“Rule 25(c) is not
designed to create new relationships among parties to a suit
but is designed to allow the action to continue unabated when
an interest in the lawsuit changes hands.”).
25(c) places no time limit on a party seeking substitution or
joinder. See Fed. R. Civ. P. 25(c); see also
Luxliner P.L. Exp., Co. v. RDI/Luxliner, Inc., 13 F.3d
69, 71 (3d Cir. 1993); 7C Charles Wright & Arthur Miller,
Federal Practice & Procedure § 1958 (3d ed.
2016) (“Since Rule 25(c) is wholly permissive there is
no time limit on moving to substitute under its
to Federal Rule of Civil Procedure 25(c), PLM has moved to
substitute PLM Operations as the sole Plaintiff and to join
that entity as an additional Counter-Defendant. See
generally PLM Mot. Sub. PLM argues that PLM (Sub)
transferred the marks at issue in this case to PLM Operations
on April 1, 2016. PLM Mot. Sub at 2. Thus, PLM argues, PLM
Operations became the real party in interest and the Court
should substitute PLM Operations as the sole Plaintiff. PLM
Mot. Sub at 2. To avoid any prejudice to PROLACTO, PLM states
that PLM Operations volunteers to join the case as an
additional Counter-Defendant. PLM Mot. Sub at 2.
opposes the motion to substitute and join PLM Operations.
See generally PROLACTO's Opp'n Mot. Sub.
PROLACTO argues that a purported successor in interest must
show, not only a valid transfer of interest, but also
“that the successor will be liable for any wrongs of
its predecessor.” PROLACTO's Opp'n Mot. Sub at
1. PROLACTO argues that PLM has not shown that “PLM
Operations has acquired the liabilities of PLM (Sub).”
PROLACTO's Opp'n Mot. Sub at 2. PROLACTO states that
the Court should permit limited discovery on the purported
transfer of the relevant marks and hold an evidentiary
hearing. PROLACTO's Opp'n Mot. Sub at 2. In the
alternative, PROLACTO argues that the Court should deny the
motion. PROLACTO's Opp'n Mot. Sub at 2.
Transfer of the Relevant Marks
trial, PLM filed a motion pursuant to Rule 15 of the Federal
Rules of Civil Procedure seeking leave to correct the caption
in this case. Specifically, PLM requested leave to correct
the case caption to replace “Paleteria La Michoacana,
LLC” as a Plaintiff and Counter-Defendant with
“Paleteria La Michoacana (Sub), Inc.” in order to
reflect a change in its corporate form. See
Pls.' Mot. Leave Correct Case Caption, ECF No. 210. The
Court granted that motion on March 31, 2016. See
Mem. & Order, ECF No. 333.
following day, PLM (Sub) sold “substantially all of its
assets” to PLM Operations, which is a limited liability
company organized under the laws of the state of Delaware.
See PLM Mot. Sub. at 3; see also PLM Mot.
Sub., Decl. of Robert J. Spigner (“Spigner
Decl.”) ¶¶ 2-3, ECF No. 336-1; Spigner Decl.,
Ex. A (providing the State of Delaware Certificate of
Formation and a copy of the Delaware Secretary of State's
website listing relevant details of PLM Operations). PLM has
provided the Bill of Sale, General Assignment and Conveyance,
which sets forth the details of the transaction. See
Spigner Decl., Ex. B. The transferred assets included the
marks at issue in this case, including U.S. Registration
Numbers 2, 905, 172, 2, 968, 652, and 3, 210, 304.
See Spigner Decl. ¶ 3; see also
Spigner Decl., Ex. B, schd. 1, annex D.
April 1, 2016, PLM (Sub) and PLM Operations executed a
Trademark Assignment Agreement memorializing the transfer of
the marks. See Spigner Decl. ¶ 4; see
also Spigner Decl., Ex. C (Trademark Assignment
Agreement). PLM has recorded that agreement with the USPTO.
See Spigner Decl. ¶ 4. According to the terms
of the agreement, PLM (Sub) assigned and transferred to PLM
Operations “all of Assignor's right, title and
interest in and to the Trademarks, together with all goodwill
associated with said Trademarks, and the right to sue and
recover for, and the right to profits or damages due or
accrued, arising out of or in connection with any and all
past, present or future infringements or dilution of or
damage to the Trademarks or the associated goodwill.”
Spigner Ex. C at 20. PLM has also provided copies of entries on
the USPTO's website that reflect PLM Operations as the
listed owner of the relevant marks. See Spigner
Decl. ¶ 5; see also Spigner Decl., Ex. D.
correctly states, federal registration of a trademark is
prima facie evidence that the registrant is the proper owner
of that trademark. See 15 U.S.C. § 1057(b)
(“A certificate of registration of a mark . . . shall
be prima facie evidence . . . of the owner's ownership of
the mark.”); see also Id . § 1057(d)
(noting that a certificate of registration may be issued to
the assignee of the application, “but the assignment
must first be recorded in the [USPTO]”).
has not presented any evidence undermining the Spigner
affidavit or the documentary evidence put forth by PLM. In
fact, PROLACTO appears to acknowledge that PLM “may
have shown that certain of the relevant interests have been
transferred.” PROLACTO's Opp'n Mot. Sub. at 10.
In light of the extensive documentary evidence of a transfer
and the prima facie validity of the registration in the name
of PLM Operations, the Court finds that PLM (Sub) transferred
the marks at issue in this case to PLM Operations.
PROLACTO's Reliance on the Doctrine of Successor
of focusing on the transfer of assets, including the
relevant marks, PROLACTO argues that PLM has “not
provided any, much less sufficient, evidence that PLM
Operations has acquired the liabilities of PLM
(Sub).” PROLACTO's Opp'n Mot. Sub. at 2
(emphasis added); see also PROLACTO's Opp'n
Mot. Sub. at 1 (“[T]he Court must determine that the
successor will be liable for any wrongs of its
predecessor.”). PROLACTO urges the Court to rely on the
doctrine of successor liability to determine whether PLM
(Sub) has transferred a valid interest to PLM Operations for
the purposes of Rule 25. PROLACTO's Opp'n Mot. Sub.
at 7. Successor liability is an exception to the general rule
that “a successor corporation is not liable for the
wrongs of its predecessor.” Material Supply
Int'l, Inc. v. Sunmatch Indus. Co., Ltd., 62
F.Supp.2d 13, 23 (D.D.C. 1999). Under the four traditional
exceptions, a successor corporation will be liable where:
“(1) there is an express or implied agreement to assume
the liabilities; (2) the transaction amounts to a
consolidation or merger; (3) the successor entity is a mere
continuation or reincarnation of the predecessor entity; or
(4) the transaction was fraudulent, not made in good faith,
or made without sufficient consideration.” Id.
(quoting Bingham v. Goldberg, Marchesano, 637 A.2d
81, 89-90 (D.C. 1994)).
reliance on successor liability is misplaced. Rule 25(c) asks
simply whether an “interest is transferred.”
Fed.R.Civ.P. 25(c). PROLACTO's confusion appears to arise
from cases where a party seeks to use Rule 25(c) to
force an unwilling entity into the litigation. For
instance, PROLACTO cites Select Creations, Inc. v.
Paliafito America, Inc., 852 F.Supp. 740 (E.D. Wis.
1994) and Panther Pumps & Equipment Co. v.
Hydrocraft, Inc., 566 F.2d 8 (7th Cir. 1977) for the
principle that the court must consider the substantive law of
successor liability before approving a substitution.
See PROLACTO's Opp'n Mot. Sub. at 7. In both
cases, however, the court considered successor liability only
because a party was attempting to bring an unwilling
successor before the court. See Select Creations,
852 F.Supp. at 766 (granting a motion to substitute unwilling
non-parties); Panther Pumps, 566 F.2d at 28
(approving substitution of unwilling party).
case does not fit that pattern. Instead, PLM Operations is
volunteering to join the case, both as the sole Plaintiff and
as an additional Counter-Defendant. See PLM Mot.
Sub. at 6. This distinction is longstanding. For instance, in
McComb v. Row River Lumber Co., which PROLACTO cites
in its brief, the Ninth Circuit refused to bring an unwilling
defendant into the case. 177 F.2d 129, 130 (9th Cir. 1949).
The court explained that it had allowed substitutions
“in cases where the plaintiff below has transferred his
interest in the subject matter of the action, ” but
that, “where substitution is sought in this court for a
defendant below . . . we have declined to allow a
distinction, found in other cases, reflects the due process
concerns raised by forcing a party to step into the shoes of
another against their will, perhaps even after a court has
entered a judgment. See, e.g., Luxliner P.L.
Exp., Co. v. RDI/Luxliner, Inc., 13 F.3d 69, 72 (3d Cir.
1993) (considering third party's due process interests);
Panther Pumps, 566 F.2d at 24 (same). Those fairness
concerns are not at issue in a case like this, where a
plaintiff has transferred an interest in the case and
voluntarily seeks substitution. See, e.g., Burka
v. Aetna Life Ins. Co., 87 F.3d 478, 480 (D.C. Cir.
1996) (making no mention of successor liability or due
process where all parties agreed that a third party should be
a party to the suit). Because PLM Operations seeks to join
this action voluntarily, the Court's analysis must focus
on whether “an interest is transferred, ”
Fed.R.Civ.P. 25(c), not whether that interest comes with
Substitution and Joinder Will Facilitate Litigation
proper criteria for deciding a motion under Rule 25(c) is
whether substitution would “facilitate the conduct of
the litigation.” Comm'ns Imp. Exp., S.A. v.
Republic of Congo, 118 F.Supp.3d 220, 231 (D.D.C. 2015)
(quoting Citibank v. Grupo Cupey, Inc., 382 F.3d 29,
32 (1st Cir. 2004)); see also 7C Charles Wright
& Arthur Miller, Federal Practice &
Procedure § 1958 (3d ed. 2016) (“An order of
joinder is merely a discretionary determination by the trial
court that the transferee's presence would facilitate the
conduct of the litigation.”). Any substitution or
joinder under Rule 25(c) does not change the substance of the
litigation, but simply allows the case to go forward when an
interest changes hands. See In re Covington Grain Co.,
Inc., 638 F.2d 1362, 1364 (5th Cir. 1981). The Court
finds that substitution is appropriate here.
relevant marks are undoubtedly at the core of this
long-running litigation. For example, Count I of PLM's
Second Amended Complaint seeks reversal of the TTAB decision
cancelling one of the transferred marks. See 2d Am.
Compl. ¶¶ 42-48. Similarly, Counts II and III seek
a declaratory judgment of noninfringement and injunctive
relief to stop ongoing infringement, respectively, related to
the transferred marks. See 2d Am. Compl.
¶¶ 49-51, 52-56. The Court has found that
uncontested evidence shows that PLM (Sub) transferred the
relevant marks to PLM Operations. See supra Part.
III.B.1. Although the rights of PLM Operations, if
substituted, are the same as the original Plaintiffs, it now
owns the relevant marks and has the sole interest in the
outcome of this litigation. See Crown Point Partners LLC
v. Crown Point Plan Comm'n, 275 F.R.D. 279, 282
(N.D. Ind. 2011) (“First Financial, as a creditor and
transferee in interest to the property, has a protectable
interest in the outcome of this litigation and should be
substituted, although its rights do not exceed those of Lauth
and CPP in this litigation.”). Therefore, the Court
finds that substituting the owner of the relevant marks as
the sole Plaintiff will best facilitate any ongoing
also volunteered to join PLM Operations as an additional
Counter-Defendant to address any possible prejudice to
PROLACTO. See PLM Mot. Sub. at 2. Following
PROLACTO's opposition to PLM's motion for
substitution, PLM “withdr[ew] that portion of its
Motion seeking to add PLM Operations as an additional
counter-defendant, ” but nevertheless “does
not object if the Court joins PLM operations as an
additional counter-defendant.” Pl.'s Reply Supp.
Mot. Sub. (“PLM's Reply Mot. Sub.”) at 15-16,
ECF No. 342 (emphasis added). Rule 25(c) permits the Court to
substitute or join a party. See Fed. R.
Civ. P. 25(c). In order to avoid any possibility of
prejudice, the Court will therefore exercise its discretion
to join PLM Operations as an additional Counter-Defendant, as
well as substituting it as the sole Plaintiff.
PROLACTO's Request for Discovery and a Hearing
the Court turns to PROLACTO's request for discovery and a
formal hearing on PLM's motion to substitute PLM
Operations. PROLACTO argues that “[l]imited discovery
may better enable the Court to make an informed determination
of whether PLM (Sub) has made a valid transfer of interest to
PLM Operations and to avoid an inequitable outcome to
PROLACTO.” PROLACTO's Opp'n Mot. Sub. at 11.
PROLACTO also requests a hearing on this issue.
PROLACTO's Opp'n Mot. Sub. at 11
the Court has found that the uncontested evidence is
sufficient to show that PLM (Sub) transferred the relevant
trademarks to PLM Operations. See supra Part
III.B.1. Second, the Court's decision to join PLM
Operations as an additional Counter-Defendant ensures that
the substitution will avoid inequitable outcomes for
PROLACTO. See supra Part III.B.3. Finally, the Court
notes that there is no requirement to grant limited discovery
or a hearing in this context. The Seventh Circuit recently
noted that there is no rule “that an evidentiary
hearing is mandatory to resolve every Rule 25(c)
substitution.” Sullivan v. Running Waters
Irrigation, Inc., 739 F.3d 354, 359 (7th Cir. 2014). In
fact, courts that have required an evidentiary hearing often
point to the due process concerns raised by hailing an
unwilling party into the action, particularly where
substitution effectively imposes liability. See Luxliner
P.L. Exp., 13 F.3d at 72. That is not the case here, and
the Court therefore denies PROLACTO's request for limited
discovery and a hearing.
THE PARTIES' MOTIONS TO AMEND THE FINDINGS AND
the bench trial, post-trial briefing, and the Court's
release of its Findings of Fact and Conclusions of Law, both
parties have filed motions to amend the Court's judgment.
Each of the motions raises legal arguments for the first time
in this litigation. Therefore, the Court will deny both
Federal Rule of Civil Procedure 52(b)
to Federal Rule of Civil Procedure 52(b), a party may file a
motion requesting that the Court “amend its findings-or
make additional findings-and . . . amend the judgment
accordingly.” Fed. R. Civ. P 52(b). This Rule
“permits the trial court to correct manifest errors of
law or fact, make additional findings or take other action
that is in the interests of justice.” Ashraf-Hassan
v. Embassy of France, 185 F.Supp.3d 94, 108 (D.D.C.
2016) (quoting Bigwood v. Def. Intelligence Agency,
770 F.Supp.2d 315, 318 n.2 (D.D.C. 2011)). The decision to
amend findings or the judgment is committed “to the
sound discretion of the trial judge.” See Material
Supply Int'l, Inc. v. Sunmatch Indus. Co., No.
94-1184, 1997 WL 243223, at *2 (D.D.C. May 7, 1997); see
also Ashraf-Hassan, 185 F.Supp.3d at 108. And a party
bringing a Rule 52(b) motion “bears a heavy
burden.” Ashraf-Hassan, 185 F.Supp.3d at 108
(quoting Material Supply Int'l, 1997 WL 243223,
motion under Rule 52(b) “is not an avenue for
relitigating issues upon which the moving party did not
prevail at trial.” Material Supply Int'l,
1997 WL 243223, at *2. Instead, a movant “who failed to
prove his [or her] strongest case is not entitled to a second
opportunity to litigate a point, to present evidence that was
available but not previously offered, or to advance new
theories by moving to amend a particular finding of fact or
conclusion of law.” Salazar v. District of
Columbia, 685 F.Supp.2d 72, 75 (D.D.C. 2010) (quoting 9C
Charles Wright & Arthur Miller, Federal Practice
& Procedure § 2582 (3d ed. 2009)); see also
Diocese of Winona v. Interstate Fire & Cas. Co., 89
F.3d 1386, 1397 (8th Cir. 1996) (finding that a party could
not use a 52(b) motion to raise an argument that could have
been raised prior to the entry of a judgment); Fontenot
v. Mesa Petroleum Co., 791 F.2d 1207, 1219 (5th Cir.
1986) (explaining that a Rule 52(b) motion should not be
employed “to advance new theories”).
Federal Rule of Civil Procedure 59(e)
Rule of Civil Procedure 59(e) permits a party to file
“[a] motion to alter or amend a judgment” within
“28 days after the entry of the judgment.”
Fed.R.Civ.P. 59(e). “Reconsideration of a judgment
after its entry is an extraordinary remedy which should be
used sparingly, ” Mohammadi v. Islamic Republic of
Iran, 782 F.3d 9, 17 (D.C. Cir. 2015) (quoting 11
Charles Wright & Arthur Miller, Federal Practice
& Procedure § 2810.1 (3d ed. 2012)), and the
moving party bears the burden of establishing