IN THE MATTER OF THE ESTATE OF RUTH C. BISIGNANO, Deceased. EXILE BREWING COMPANY, LLC, Appellant, vs. ESTATE OF RUTH C. BISIGNANO, Appellee. IN THE MATTER OF THE ESTATE OF FRANK J. BISIGNANO, Deceased. EXILE BREWING COMPANY, LLC, vs. Appellant, ESTATE OF FRANK J. BISIGNANO, Appellee.
No. 22-0288
IN THE SUPREME COURT OF IOWA
Submitted March 30, 2023—Filed May 26, 2023
McDermott, J.
A business alleged to have misappropriated a decedent‘s intellectual property appeals the probate court‘s reopening of the decedent‘s and decedent‘s husband‘s estates to pursue the misappropriation claim; the Estates cross-appeal the denial of their request for attorney‘s fees. AFFIRMED.
McDermott, J., delivered the opinion of the court, in which all justices joined.
Scott M. Wadding (argued), Matthew G. Sease, and Delaney J. Kozlowski of Sease & Wadding, Des Moines, for appellees.
The Estates of Ruth Bisignano and her husband Frank Bisignano sued Exile Brewing Company based on the use of Ruth‘s name and likeness in Exile‘s promotion and sale of its popular beer called “Ruthie.” To enable the estates to pursue these claims, Frank Bisignano‘s nephew first filed petitions in the probate court to reopen the estates, as both estates had long since closed. The probate court granted both motions to reopen, and the estates filed the civil lawsuit against Exile. Exile sought to intervene in the probate case, filing a motion to vacate the reopening orders. In this appeal, we must decide whether the probate court erred in denying Exile‘s request to intervene in the probate case and close the Estates.
I. Ruth Bisignano and Exile‘s “Ruthie” Beer.
Ruth Bisignano—“Ruthie,” as she was professionally known—owned and operated a popular bar in Des Moines throughout the 1950s and ‘60s called “Ruthie‘s Lounge.” She was famously (or, to some, scandalously) known for her ability to serve beer by balancing two pint glasses on her chest in a bar trick she referred to as the “well-balanced glass of beer.” The trick earned her both attention in newspapers across the country and a premium price on drinks—reportedly charging about three times as much as other bars in town. It also earned her some legal trouble, although perhaps of the no-such-thing-as-bad-publicity variety. Ruth was criminally charged several times for performing her serving trick with allegations that included “indecent dress and behavior” and “indecent behavior and running her lounge in a loud, boisterous manner with
In 2012, Exile Brewing Company (Exile), taking Ruth and her contributions to the beer and restaurant industry as an inspiration, named one of its craft beers “Ruthie” and used Ruth‘s image performing her serving trick on bottles, cans, beer taps, and other paraphernalia. Today Ruthie is the best-selling Iowa-made beer in the state. Before it began selling the Ruthie beer, Exile searched for trademarks and products sold under the name “Ruthie,” searched for pictures of Ruth, and searched for children, an estate, or a trust for her. Exile alleges that the search came up empty, so it began selling the beer using the name “Ruthie” and Ruth‘s likeness. Exile applied for a federal trademark for “RUTHIE” in 2019, which was granted in 2021.
II. Reopening the Estates.
When Ruth died intestate in 1993, her husband Frank Bisignano served as the administrator of her estate. The list of assets on the final report and inventory for her estate didn‘t include the name “Ruthie” or Ruth‘s name and likeness as property. Ruth‘s estate was closed in 1993.
Frank died intestate three years later. His niece, Andrea Huntsman, served as the administrator of Frank‘s estate. The list of assets on the final report and inventory for his estate likewise didn‘t include the name “Ruthie” or Ruth‘s name and likeness as property. The final report listed Frank‘s heirs as his three
Fred Huntsman is Frank Bisignano‘s nephew and the son of Frank‘s deceased sister Barbara Hamand. In March 2020, Huntsman filed a petition to reopen Frank‘s estate, alleging that he “hired an attorney to investigate and pursue potential claims against a corporation” that, if successful, would benefit Frank‘s estate. The probate court promptly granted the motion to reopen Frank‘s estate and appointed Huntsman as administrator. In September 2020, Huntsman filed a petition to reopen Ruth‘s estate on the same grounds. The probate court promptly granted the motion to reopen Ruth‘s estate, too, and appointed Huntsman as administrator.
III. The Estates’ Civil Lawsuit and Exile‘s Motion to Vacate and Close the Estates.
In June 2020, Huntsman, as administrator of Frank‘s estate, filed a lawsuit in Iowa district court against Exile alleging common law appropriation of Ruth‘s name and likeness, appropriation of the commercial value of Ruth‘s identity and infringement of the right of publicity, common law misappropriation of trade values, consumer fraud under
While those summary judgment motions were pending in the civil case, Exile filed a motion in the probate court to vacate, dismiss, and close both estates. Exile, describing itself as an “interested party” in the estates, argued that the probate court lacked jurisdiction to reopen the estates under
In November, the probate court denied Exile‘s motion. The probate court held that Exile had no right to intervene in the probate proceedings and instead was an interloper in the case. The probate court thus struck Exile‘s motion to
In January 2022, the district court ruled on the summary judgment motions. It took no action on Exile‘s standing and jurisdiction arguments, deferring instead to the probate court‘s ruling that the estates were properly reopened. The district court went on to deny both sides’ summary judgment motions. Soon thereafter, the estates successfully moved to amend their petition in the civil lawsuit to replace their common law claim for trade and service mark infringement with a claim for deceptive advertising and false designation of origin under the Lanham Act,
Exile appealed the probate court‘s ruling. The estates cross-appealed the probate court‘s denial of their application for attorney‘s fees. We‘ve consolidated Ruth‘s and Frank‘s probate cases for appeal based on the identical issues presented.
IV. Exile‘s Intervention in the Probate Estates.
We begin with the probate court‘s threshold determination that Exile is an interloper with no ability to challenge the estates’ reopening. As the probate court noted, the probate code includes no provisions that address a party‘s intervention in a probate proceeding. But
The rule on intervention as of right (as relevant here) states that “anyone shall be permitted to intervene in an action . . . [w]hen the applicant claims an interest relating to the property or transaction which is the subject of the action” and “is so situated that the disposition of the action may as a practical matter impair or impede the applicant‘s ability to protect that interest” unless the interest is otherwise adequately protected by another party.
The rule on permissive intervention (as relevant here) states that “anyone may be permitted to intervene in an action . . . [w]hen an applicant‘s claim or defense and the main action have a question of law or fact in common.”
In In re Estate of DeVoss, 474 N.W.2d 539, 541 (Iowa 1991), we noted the confusion that surrounds the appellate standard of review from denials of intervention because of the two different types of intervention. In DeVoss, two heirs appealed the district court‘s denial of their attempt to intervene as of right in a probate case. Id. at 542. We affirmed the district court, determining that the heirs’ interest “was too remote . . . to entitle them to intervention.” Id. On the standard of review, we remarked that most intervention appeals will “revolve around an evaluation of the ‘interest’ claimed by the party seeking to intervene,” and stated that review thus should be “on error, with some deference given to the district court‘s discretion.” Id. at 541.
A. Intervention as of Right.
Exile argues that it was entitled to intervention as of right because it seeks to “defin[e] the property rights that Huntsman actually inherited through intestate succession” and to “ensur[e] that Huntsman is not granted, through the probate proceedings, rights that encroach upon the trademark rights that Exile was already vested with” through its use and registration of the “Ruthie” trademark.
But neither ground establishes—as required by the rule—that Exile would be left “so situated that the disposition of the action may as a practical matter impair or impede the applicant‘s ability to protect that interest.”
Further, Exile is ill-suited to challenge the probate court‘s appointment of Huntsman as a special administrator of these estates. An “interested person” in probate is generally “one whose ‘interests are directly affected by a diminution of the [estate] assets.’ ” In re Est. of Boyd, 634 N.W.2d 630, 638-39 (Iowa 2001) (alteration in original) (emphasis added) (quoting In re Est. of Plumb, 129 N.W.2d 630, 632-33 (Iowa 1964)). Exile makes no claim that it would suffer by a diminution of assets in the estate; indeed, the opposite is true since Exile argues it will suffer if the court doesn‘t prevent an asset (the cause of action to enforce Ruth‘s intellectual property rights) from entering the estates. Exile is not an heir at law, a beneficiary under any testamentary instrument, a creditor of the estates or the decedents, or any other claimant seeking estate assets. Rather, Exile‘s role is merely that of a potential debtor to the estates if it‘s held liable in the civil lawsuit for misappropriating Ruth‘s name or likeness. Cf. In re Troester‘s Est., 331 N.W.2d 123, 127 (Iowa 1983) (noting the district court‘s determination “that appellants as possible debtors of the estate were not interested parties to the estate proceedings and could not intervene in the proceedings“). The probate
That Exile‘s interest is only a potential one at this point is another strike against intervention. Contingent interests, we have said, “are insufficient to allow intervention by right.” DeVoss, 474 N.W.2d at 542. Exile‘s interest in the estates depends on its property interest in Ruth‘s image and likeness, and that interest depends on the outcome of the trademark and civil litigation matters that are underway. We find no error in the district court‘s determination that Exile failed to establish that it was an interested party entitled to intervention as of right.
B. Permissive Intervention.
Exile also argues that it was entitled to permissive intervention. We will afford a district court a relatively greater measure of deference in our review of a permissive intervention decision considering that the court “exercis[es] its discretion” in deciding whether an applicant ”may be permitted to intervene” under the permissive intervention rule. See
In analyzing whether Exile‘s “claim or defense” involves a common question of law or fact in the probate proceeding,
In considering applications for permissive intervention, the rule directs that courts “grant or deny the application as the circumstances require.”
Because we affirm the district court‘s judgment on the threshold issue denying Exile‘s attempt to intervene in the matter and striking Exile‘s motion to vacate, dismiss, and close the estates, we need not address the merits of the other issues raised in that motion.
V. The Estates’ Request for Attorney‘s Fees.
The estates cross-appeal the probate court‘s denial of their request for attorney‘s fees. As a basis for their request, they recite Exile‘s statement in the civil action that Ruth‘s estate was the proper plaintiff to bring the claim, only to later move to vacate the order reopening Ruth‘s estate after her estate was added as a plaintiff. The estates also argue that Exile pursues a frivolous end run of the district court‘s summary judgment ruling by repackaging previously-rejected arguments in this appeal.
The estates ask us to enforce
Imposing a fee-shifting sanction is a rare exception to our general rule that losing litigants don‘t pay the victor‘s attorney‘s fees. In re Guardianship of Radda, 955 N.W.2d 203, 214–15 (Iowa 2021). We consider a variety of factors in evaluating compliance with the rule, including the time available to investigate and research facts, the complexity of factual and legal issues, the clarity or ambiguity of existing law, and the plausibility of the legal positions asserted. Retterath, 938 N.W.2d at 710. Arguments “made in good faith” weigh against a sanction. Id. In In re Guardianship of Radda, for instance, we determined that even though a party presented questions of first impression that lacked merit, the arguments weren‘t frivolous within the meaning of
The primary purpose of sanctions under
VI. Conclusion.
Our holding in this appeal rests exclusively on the probate court‘s decision to reject Exile‘s attempt to intervene and to strike Exile‘s motion to vacate, dismiss, and close. We advance no views and take no position on the existence or inheritability of Ruth‘s name, image, and likeness rights. Exile‘s only connection to the probate proceedings is as a potential debtor to the estates. We will not turn the probate court‘s simple reopening of the estates into a second litigation over whether or to whom the potential debt is owed where Exile has no other connection to the estates. Exile has the opportunity to raise its defenses in the civil lawsuit to determine whether it is in fact a debtor.
We affirm the probate court‘s grant of the estates’ motion to strike Exile‘s motion to dismiss, vacate, and close, and affirm the related denial of Exile‘s motion to intervene. We also affirm the probate court‘s denial of the estates’ request for attorney‘s fees.
AFFIRMED.