Hardriders Motorcycle Club Association, Hardriders Motorcycle Club Fort Bend County Chapter, Hardriders Club Galveston County Chapter, Hardriders Club Lafayette Chapter, Hardriders Motorcycle Club Beaumont Chapter and Efrem Sewell v. Hardriders, Inc., Waverly Nolley and Shannon Mayfield
14-14-00234-CV
| Tex. | Aug 25, 2015Background
- A motorcycle club formed circa 2000 (founder Jimmy Davis) using the name “Hard Riders” and a distinctive "flames" logo; early activities included rallies, dues, and an assumed name filing for “Hard Riders.”
- In 2005 members voted to incorporate to limit liability; HardRiders, Inc. was formed as a close corporation (Scott and Frazier shareholders). No written asset-assignment document was produced.
- After incorporation the club continued operating (bank account, events, bylaws and a national constitution referencing HardRiders, Inc. and the flames logo); domain hardridersmc.com was later purchased and used in the club’s operations.
- Following internal elections and disputes, rival faction members filed for the flames trademark and formed a new nonprofit; HardRiders, Inc. sued the individuals and the new nonprofit asserting ownership of the name, logo, and website.
- A jury found HRMCA (the unincorporated association) existed since March 2000 but — on the key ownership question — found HardRiders, Inc. held the superior right to the trade name, trademark (flames), and website as of February 28, 2011; the trial court entered judgment and permanent injunctions for HardRiders, Inc.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Who held superior right to the Hard Riders name, flames logo, and website? | HRMCA: it was the senior user (origin 2000) and no transfer to HardRiders, Inc. occurred, so HRMCA owns the marks and site. | HardRiders, Inc.: incorporation and members’ conduct effected transfer (implied) of assets to the corporation; use and filings thereafter show corporate ownership. | The jury verdict (and trial court judgment) that HardRiders, Inc. had the superior right was supported by legally sufficient evidence and is affirmed. |
| Whether incorporation alone can transfer association property without written assignment | HRMCA: a formal written transfer is required for title of trademark and assets. | HardRiders, Inc.: no statute requires a written assignment for common-law ownership; member conduct and continued corporate use support implied transfer. | Court: no statutory requirement applies to unregistered marks; implied transfer based on member conduct and use is a factual question for the jury. |
| Standard for reviewing denial of motion to disregard jury findings / JNOV | HRMCA: verdict contradicts undisputed facts and jury instructions. | HardRiders, Inc.: evidence permits reasonable inference of transfer and continued corporate ownership; jury charge permitted ordinary meaning of "superior right." | Court: reviewed legal sufficiency under City of Keller/Dow Chem. and concluded more than a scintilla supports the jury’s finding. |
| Effect of jury charge lacking trademark legal definitions (e.g., "senior user") | HRMCA: lack of instruction on trademark law compelled a finding in its favor since it was first in time. | HardRiders, Inc.: jury may apply ordinary meaning of "superior" and decide based on conduct and use. | Court: because parties did not object, the jury could use ordinary meaning; verdict stands. |
Key Cases Cited
- City of Keller v. Wilson, 168 S.W.3d 802 (Tex. 2005) (legal-sufficiency review and deference to jury inferences)
- Dow Chem. Co. v. Francis, 46 S.W.3d 237 (Tex. 2001) (attacker of finding must show conclusive proof of vital facts)
- Union Nat’l Bank of Tex., Laredo v. Union Nat’l Bank of Tex., Austin, Tex., 909 F.2d 839 (5th Cir.) (ownership of trademark rests on priority of use)
- Blue Bell, Inc. v. Farah Mfg. Co., Inc., 508 F.2d 1260 (5th Cir.) (conception or advertising alone does not establish trademark rights)
- Edwards v. Old Settlers’ Ass’n, 166 S.W. 423 (Tex. Civ. App. 1914) (incorporation and delivery/possession can effect transfer from unincorporated association)