C & N CORPORATION, doing business as Door Peninsula Winery v. GREGORY KANE & ILLINOIS RIVER WINERY, INC.
No. 13-3786
United States Court of Appeals, Seventh Circuit
June 24, 2014
756 F.3d 1024
The district court determined that the tenth factor weighed in favor of abstention due to the “overwhelming evidence that Freed behaved vexatiously by bringing [the Distributional Interest Lawsuit] in federal court and [the Chase Lawsuit] as a separate suit in state court.” The record demonstrates that Judge Pantle in the state court proceeding has made a number of rulings unfavorable to Freed, such as granting Weiss‘s motion to enjoin Freed from filing or pursuing other related actions in state court. Judge Pantle stated that she was “very concerned about an abuse of process here and a manipulation of the system” and concluded that Freed was “seeking to litigate matters at the heart of [the state court proceeding] before other judges in an attempt to evade [Judge Pantle‘s] orders.” In fact, Judge Pantle even initiated contempt proceedings against Freed based on what she believed to be instances of misconduct and unlawful litigation tactics.
Indeed, Freed‘s filing of various actions in federal court that arise from the same dispute between Freed and Weiss concerning CLG is indicative of an attempt to evade the state court. However, even setting aside these presumptions, this factor can weigh in favor of abstention when the claims and parties in the federal suit could have been included in the original state court proceeding. See, e.g., Interstate Material Corp. v. City of Chicago, 847 F.2d 1285, 1289 (7th Cir. 1988) (finding that the federal suit could be considered contrived and vexatious when there was “no reason why all claims and all parties could not have been, and still could not be, part of one suit“). Thus, the tenth factor also weighs in favor of abstention.
In sum, several factors strongly favor abstention while numerous others weigh in its favor. Freed has not presented persuasive arguments to establish why any of the factors strongly weigh against abstention. Since the factors more heavily weigh in favor of a stay, we respectfully suggest that the state court should first resolve when Freed dissociated from CLG and whether he has stated a claim for breaches of contract or fiduciary duty against Weiss before any of the derivative federal suits can go forward. Accordingly, we find that the district court did not abuse its discretion in finding that the nature and circumstances of the state and federal proceedings warranted a stay.
III. CONCLUSION
For the foregoing reasons, we find that the concurrent state and federal proceedings at issue in this appeal are parallel and that the ten Colorado River factors carefully considered by the district court weigh in favor of abstention. The district court‘s orders to stay the federal cases pending the outcome of the state court proceeding are AFFIRMED.
Christopher Reagan Liro, Aaron T. Olejniczak, Andrus, Sceales, Starke & Sawall, Milwaukee, WI, for Plaintiff-Appellee.
Timothy J. Casper, Attorney, Murphy & Desmond S.C., Madison, WI, for Defendant-Appellant.
Before KANNE and ROVNER, Circuit Judges, and DOW, District Judge.*
Both parties in this case are Midwestern wineries that produce a spiced apple wine they call “Hallowine.” Door Peninsula Winery sued Illinois River Winery and its owner, Gregory Kane, for trademark infringement. The district court ruled in Door Peninsula‘s favor and ordered Illinois River to pay damages. Illinois River now appeals, but because it raises only arguments that were not before the district court, we affirm.
I. BACKGROUND
Door Peninsula Winery, a Wisconsin company, began selling and distributing a spiced apple wine called “Hallowine” in 1998. Sales were brisk, and Door Peninsula expanded operations into Illinois later that year.
The seasonal spiced apple wine market also beckoned to Illinois River Winery and its owner, Gregory Kane. Illinois River1 began selling its own Hallowine in 2005 and sought to register the Hallowine mark with the Patent and Trademark Office (“PTO“) in 2006. Door Peninsula initiated opposition proceedings at the PTO and the Trademark Trial and Appeal Board ruled in its favor, finding that Door Peninsula had priority in the Hallowine mark.
Illinois River continued to sell its Hallowine despite the PTO ruling. Kane considered alternative names for the seasonal wine, but ultimately decided that consumers would prefer Hallowine.
II. ANALYSIS
Illinois River now appeals the district court‘s decision, arguing that it was defective for three reasons: (1) Kane is not liable for damages in his individual capacity (2) damages incurred before March 16, 2012 are barred by the applicable statute of limitations, and (3) “Hallowine” is not a protectable mark.
The first two claims are easily dismissed. Illinois River did not present them to the district court, and they are therefore waived. Puffer v. Allstate Ins. Co., 675 F.3d 709, 718 (7th Cir. 2012). A defendant cannot withhold arguments at trial and then fault the district court on appeal for not addressing them.
The third claim is also waived, but the analysis is a little more complex. The district court did find that Door Peninsula “established the validity of the HALLOWINE mark as a protectable mark.” Illinois River seizes on this statement, arguing that since the district court decided the mark was protectable, it could not possibly have waived a protectability argument.
Presumably, the court ruled on protectability in response to Door Peninsula‘s brief, which marshaled both facts and law in support of its argument that “Hallowine” was a protectable mark. We will not find that an argument was adequately preserved solely because a party‘s opponent defended against the argument, as Door Peninsula did here. Williams v. Dieball, 724 F.3d 957, 962 (7th Cir. 2013) (“to find that one party‘s argument was preserved because his opponent defended against it out of an abundance of caution would be to punish the opponent for being more thorough.“). The party making the argument on appeal must have raised it before the district court itself, which Illinois River failed to do. Its statement of undisputed facts contained the results of Google searches for “Hallowine,” and a vague assertion that “Hallowine” was commonly used for fall special events. But Illinois River did not argue protectability in response to Door Peninsula‘s motion for summary judgment. Arguments that are “underdeveloped, conclusory, or unsupported by law” are waived on appeal. Puffer, 675 F.3d at 718. Illinois River‘s argument was all three and thus was waived.
We make one final note: At oral argument, Illinois River argued that it could not have waived its protectability argument because a finding that the mark was, in fact, unprotectable would have gutted Door Peninsula‘s prima facie case. This is untrue. Summary judgment law “does not permit a nonmovant defendant to delay pointing out claimed flaws in the plaintiff‘s prima facie case until an appeal is under way.” Resolution Trust Corp. v. Juergens, 965 F.2d 149, 153 (7th Cir. 1992). The argument was waived; Illinois River cannot circumvent decades of our precedent requiring arguments be adequately presented at trial.
III. CONCLUSION
Illinois River did not adequately present any of its arguments on appeal to the
KANNE
Circuit Judge