I.M. WILSON, INC. v. OTVETSTVENNOSTYOU "GRICHKO", 2:18-cv-05194

Background

I.M. Wilson, a U.S. distributor, acquired and registered the GRISHKO trademark in the United States in the 1990s based on two letters from Nicolay Grishko; several later U.S. registrations became incontestable.
Defendants (000 Grichko, Grishko S.R.O., and Nicolay Grishko) are the foreign manufacturers/owners of GRISHKO worldwide except the U.S.; they historically granted I.M. Wilson exclusivity under a 1990/1992 exclusive trademark license and distribution agreement (ETLDA).
The parties’ relationship soured after defendants terminated the ETLDA in 2016 (effective post-termination exclusivity through March 1, 2018). Around that time defendants began selling GRISHKO-branded products directly to U.S. customers via grishkoshop.com.
I.M. Wilson sued for trademark infringement and sought a preliminary injunction to stop defendants’ U.S. sales; defendants moved to dismiss or stay and compel arbitration under the ETLDA arbitration clause.
The Court held multi-day hearings, found I.M. Wilson likely to succeed based on its incontestable registrations and inevitable confusion from concurrent use, found irreparable harm, balanced equities for a preliminary injunction (but noted public interest concerns), and denied the motion to compel arbitration because the ETLDA (and its arbitration clause) terminated and this dispute does not sufficiently relate back to it.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Validity/ownership of U.S. GRISHKO marks	I.M. Wilson owns valid, incontestable federal registrations based on Grishko's 1992/1993 letters	Defendants argue letters were mere consents tied to the ETLDA (not assignments) or that consent was revoked/fraudulent	Court: I.M. Wilson's incontestable registrations establish validity and ownership; defendants failed to prove fraud or timely revocation by clear and convincing evidence
Likelihood of confusion (merits of infringement)	Defendants' identical use in U.S. inevitably causes consumer confusion	Focused primarily on ownership challenges, not directly disputing confusion	Court: Identical marks on identical goods => likelihood of confusion is established; plaintiff likely to succeed on Lanham Act claims
Irreparable harm, balance of equities, public interest	Harm to goodwill, trade, and reputation—exacerbated by defendants' communications to U.S. retailers—cannot be remedied by money alone	Injunctive relief would harm defendants by barring U.S. sales; plaintiff delayed enforcement	Court: Irreparable harm shown; equities favor plaintiff; but public interest disfavors plaintiff because consumers expect Russian-made Grishko goods and injunction denies that source—overall, injunction granted after balancing all factors
Arbitration clause / effect of ETLDA termination	Plaintiff: dispute is not subject to arbitration because ETLDA terminated and trademarks/registrations were acquired apart from ETLDA	Defendants: arbitration clause covers this dispute and compels stay/compel arbitration	Court: Arbitration clause does not survive to cover these claims; the dispute does not sufficiently relate back to the expired ETLDA, so motion to compel arbitration denied

Key Cases Cited

Ortho Pharm. Corp. v. Amgen, Inc., 882 F.2d 806 (3d Cir. 1989) (district courts may grant injunctive relief even in arbitrable disputes if traditional prerequisites are met)
Groupe SEB USA, Inc. v. Euro-Pro Operating LLC, 774 F.3d 192 (3d Cir. 2014) (four-factor preliminary injunction framework in trademark cases)
Reilly v. City of Harrisburg, 858 F.3d 173 (3d Cir. 2017) (movant must meet threshold for likelihood of success and irreparable harm before balancing remaining factors)
Opticians Ass'n of Am. v. Indep. Opticians of Am., 920 F.2d 187 (3d Cir. 1990) (concurrent identical use by unrelated parties makes likelihood of confusion inevitable)
Pappan Enters., Inc. v. Hardee's Food Sys., Inc., 143 F.3d 800 (3d Cir. 1998) (irreparable injury via loss of goodwill and control of reputation supports injunction)
Commerce Nat'l Ins. Servs., Inc. v. Commerce Ins. Agency, Inc., 214 F.3d 432 (3d Cir. 2000) (incontestable federal registration proves validity and ownership for infringement claims)
Covertech Fabricating, Inc. v. TVM Bldg. Prods., Inc., 855 F.3d 163 (3d Cir. 2017) (fraud in trademark procurement requires clear and convincing evidence; presumption of manufacturer ownership in absence of contract)
In re Bose Corp., 580 F.3d 1240 (Fed. Cir. 2009) (fraudulent procurement requires knowing, material misrepresentations; heavy burden of proof)
Litton Fin. Printing Div. v. NLRB, 501 U.S. 190 (1991) (arbitration clauses may survive contract expiration only when dispute "relates back" to the contract rights that survive termination)