Gas Depot Oil Company v. Ali et al
| Gas Depot Oil Company |
| Nasr Ali, Mubarik Ibrahim and Calumet Fuel, Inc. |
| 1:2022cv06861 |
| December 6, 2022 |
| US District Court for the Northern District of Illinois |
| Matthew F Kennelly |
| Contract: Recovery/Enforcement |
| 15 U.S.C. ยง 1125 Trademark Infringement (Lanham Act) |
| None |
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| Filing 6 MINUTE entry before the Honorable Matthew F. Kennelly: Pursuant to the notice of voluntary dismissal #5 , this case is dismissed without prejudice. Any hearing dates before this Court are stricken. Civil case terminated. Mailed notice. (mma, ) |
| Filing 5 NOTICE of Voluntary Dismissal by Gas Depot Oil Company (Conway, John) |
| Filing 4 MINUTE entry before the Honorable Steven C. Seeger: The motion for a temporary restraining order (Dckt. No. #2 ) is hereby denied. Plaintiff Gas Depot Oil Company recently filed a complaint in this new case. The case is about supplying gasoline to a gas station in Calumet City. The gist of the case involves an alleged breach of an agreement to buy gasoline from Gas Depot Oil Company, a wholesaler. Gas Depot alleges that it has a Motor Fuel Sales Petroleum Supply Agreement with Defendants Calumet Fuel (the gas station) and Nasr Ali (its owner), who bought the gas station in early 2022 from Defendant Mubarik Ibrahim. The Supply Agreement allegedly requires Calumet Fuel and Ali to buy gasoline - more specifically, Citgo-branded gasoline - exclusively from Gas Depot. See Supply Agreement, at 1 (Dckt. No. #3 -1). According to the complaint, Defendants have breached that agreement by buying gasoline from another supplier. Defendants also have begun to install Mobil brand fuel dispensers while continuing to display the Citgo brand trademark on the canopy of the gas station. Gas Depot believes that it has a contractual right to exclusively supply the gas station with gasoline, so it filed a five-count complaint (the latter three counts simply request various forms of relief, including an injunction, a declaratory judgment, and specific performance, so they aren't really freestanding counts). Count I is a breach of contract claim, alleging that Defendants are breaching the Supply Agreement by buying fuel from another supplier. Count II is a claim under the Lanham Act, alleging that the "general public and consumers will be deceived into believing they are purchasing Citgo petroleum products and services when, in fact, the general public and consumers have been purchasing Mobil branded petroleum products and services not authorized by the Gas Depot limited use license." See Cplt., at 38 (Dckt. No. #1 ). In addition to the complaint, Gas Depot fired off a motion for a temporary restraining order, preliminary injunction, and expedited discovery (Dckt. No. #3 ). It seeks an order (1) prohibiting Defendants from buying fuel from anyone else; (2) prohibiting Defendants from "using the name or likeness of the Gas Depot licensed mark, Citgo in violation of the Lanham Act;" and (3) requiring Defendants to buy gas exclusively from Gas Depot. See Mem., at 2 (Dckt. No. #3 ). To obtain a temporary restraining order or preliminary injunction pursuant to Federal Rule of Civil Procedure 65, a plaintiff "must establish that it has some likelihood of success on the merits; that it has no adequate remedy at law; [and] that without relief it will suffer irreparable harm." GEFT Outdoors, LLC v. City of Westfield, 922 F.3d 357, 364 (7th Cir. 2019) (internal quotation marks and citation omitted). If the plaintiff fails to meet any of those threshold requirements, the Court must deny preliminary injunctive relief. Id. But if the plaintiff can demonstrate those requirements, then the Court "must weigh the harm that the plaintiff will suffer absent an injunction against the harm to the defendant from an injunction, and consider whether an injunction is in the public interest." Id. (internal quotation marks and citation omitted). In the Seventh Circuit, courts employ a "sliding-scale approach": the more likely a plaintiff is to prevail on the merits, the less the balance of harms must weigh in his or her favor; correspondingly, the less likely a plaintiff is to prevail the more the balance must weigh in his or her favor. Id.; see also Girl Scouts of Manitou Council, Inc. v. Girl Scouts of the U.S.A., Inc., 549 F.3d 1079, 1086 (7th Cir. 2008) ("Specifically, the court weighs the irreparable harm that the moving party would endure without the protection of the preliminary injunction against any irreparable harm the nonmoving party would suffer if the court were to grant the requested relief."); Ty, Inc. v. Jones Grp., Inc., 237 F.3d 891, 895 (7th Cir. 2001) (explaining that under the "sliding-scale approach," "the more likely the plaintiff [is to] succeed on the merits, the less the balance of irreparable harms need favor the plaintiff's position"). Granting preliminary injunctive relief "is an exercise of a very far-reaching power, never to be indulged in except in a case clearly demanding it." Girl Scouts of Manitou Council, Inc., 549 F.3d at 1085 (internal quotation marks and citation omitted); see also Whitaker v. Kenosha Unified Sch. Dist. No. 1 Bd. of Educ., 858 F.3d 1034, 1044 (7th Cir. 2017) (explaining that a preliminary injunction "is an extraordinary remedy" that "is never awarded as a matter of right"). The Court denies the motion for emergency equitable relief, for a few reasons. An overarching problem with the motion is that Plaintiff interweaves the contract claim and the Lanham Act claim, as if to suggest that a mere breach of contract necessarily gives rise to an entitlement of temporary injunctive relief. First, Plaintiff has not established that it lacks an adequate remedy at law, at least in part. Much of the complaint and the memorandum in support of the motion is about lost sales. Plaintiff bemoans the fact that it is supposed to be the exclusive seller to Defendants, and that it is losing sales if Defendants are buying gas from someone else. See Mem., at 9-11 (Dckt. No. #3 ); see also id. at 10 (arguing that a "loss of customers" is an irreparable harm). Maybe so. But if that's the case, there is an adequate remedy at law: damages. Gas Depot could seek monetary damages for the loss of sales. The memo includes the hyperbolic assertion that "Gas Depot's very existence depends mostly on maintaining the number of retail gas station customers it has." See id. at 10. But Gas Depot has made no showing that the loss of business at this station would deliver the fatal blow. So, the contract claim does not seem to be a good candidate for emergency injunctive relief. Second, Plaintiff has not made a convincing showing of irreparable harm, because the gas station appears to be in the process of removing the Citgo signage. The thrust of the argument is about customer confusion, which is one of the elements of a Lanham Act claim. See Brithiric Enters., LLC v. Bay Equity LLC, 2021 WL 1208957, at *3 (N.D. Ill. 2021). Gas Depot argues that "Citgo branded fuel is being sold at the Location despite the display of the Mobil branded dispensers thereby violating the Lanham Act and causing consumer confusion. Obviously, customers are confused as to what brand of gasoline they are purchasing as the Location is displaying both the Citgo brand and the Mobil brand simultaneously." Id. at 4. Consumer confusion can give rise to irreparable harm that justifies emergency injunctive relief. See Reverse Mortg. Sols., Inc. v. Reverse Mortg. Sols., Inc., 2015 WL 9478214, at *8 (N.D. Ill. 2015) (citing Processed Plastic Co. v. Warner Commc'ns, Inc., 675 F.2d 852, 858 (7th Cir. 1982)). In fact, consumer confusion may give rise to a presumption of irreparable harm. See Kraft Foods Group Brands LLC v. Cracker Barrel Old Country Store, Inc., 735 F.3d 735, 741 (7th Cir. 2013); Brithric Enterprises, LLC v. Bay Equity LLC, 2021 WL 1208957, at *10 (N.D. Ill. 2021) (collecting cases both applying and declining to apply the presumption). If Plaintiff is entitled to emergency injunctive relief at all, the basis for that relief would rest entirely on the continued use of the Citgo name in the sign. That is, the crux of the argument would be that the gas station is using the Citgo name, but is also using the Mobil name, and may be selling something other than Citgo gas. But here, it is not clear how long the situation at hand will continue to create confusion. Any confusion might be coming to an end. The facts seem very much in flux. Defendants are in the process of "taking down some of the Citgo branding and replacing it with Mobil brand imaging." See Mem., at 3 (Dckt. No. #3 ). They're in the process of "de-branding the gas station." Id. at 6. The Citgo name is coming down, and maybe all of the Citgo signs are coming down. Without Citgo signs, it is hard to see how there could be confusion. And without confusion, it is hard to see why Plaintiff would be entitled to emergency relief. Third, the Court also has questions about how likely consumer confusion would be, and how serious the confusion would be, if the gas station continues to use both a Citgo sign and Mobil pumps. Selling misbranded fuel - that is, telling consumers that the gas comes from Oil Company X, when in fact it comes from Oil Company Y -- could give rise to a claim. See Getty Petroleum Corp. v. Aris Getty, Inc., 55 F.3d 718, 719 (1st Cir. 1995). But that's not exactly the situation. The case does not involve a situation where a gas station uses a sign for Oil Company X, but pumps gas from Oil Company Y without revealing the disparity to consumers. Instead, the sign on the gas station refers to Oil Company X, and the pumps refer to Oil Company Y. Consumers may not notice, and if they do notice, they may not care. There is no suggestion in the brief that gas from Oil Company X (here, Citgo) is better than the gas from Oil Company Y (here, Mobil). But maybe some consumers would notice, and be confused. And maybe the existence of confusion, in and of itself, is enough to justify relief. The Court simply flags the issue, but puts it to one side. In sum, a temporary restraining order is strong medicine. See Deckers Outdoor Corp. v. Yao Long He, 2020 WL 1983876, at *1 (N.D. Ill. 2020). Before the Court takes the extraordinary step of issuing extraordinary relief, the Court believes that it is important to pin down whether Defendants are going to continue to use the Citgo name. If so, then Plaintiff might be entitled to a temporary restraining order to avoid potential consumer confusion. But if not, it is hard to see why Plaintiff would need a temporary restraining order. The only injury would be lost sales, and damages could compensate Plaintiff for lost sales. For that limited reason, the motion for a temporary restraining order (Dckt. No. #3 ) is hereby denied. Plaintiff could renew the motion before the assigned district court judge as Plaint |
| Filing 3 MEMORANDUM of Law in Support of Plaintiff's Motion for Temporary Restraining Order, Preliminary Injunction and Expedited Discovery by Plaintiff Gas Depot Oil Company (Attachments: #1 Exhibit A to Memorandum of Law, #2 Exhibit B to Memorandum of Law, #3 Exhibit C to Memorandum of Law, #4 Notice of Filing)(Conway, John) (Docket Text Modified on 12/7/2022) (jjr, ). |
| Filing 2 MOTION by Plaintiff Gas Depot Oil Company for temporary restraining order (Conway, John) |
| CASE ASSIGNED to the Honorable Matthew F. Kennelly. Designated as Magistrate Judge the Honorable Jeffrey Cole. Case assignment: Random assignment. (khg, ) |
| CLERK'S NOTICE: Pursuant to Local Rule 73.1(b), a United States Magistrate Judge of this court is available to conduct all proceedings in this civil action. If all parties consent to have the currently assigned United States Magistrate Judge conduct all proceedings in this case, including trial, the entry of final judgment, and all post-trial proceedings, all parties must sign their names on the attached #Consent To# form. This consent form is eligible for filing only if executed by all parties. The parties can also express their consent to jurisdiction by a magistrate judge in any joint filing, including the Joint Initial Status Report or proposed Case Management Order. (khg, ) |
| Filing 1 COMPLAINT filed by Gas Depot Oil Company; Filing fee $ 402, receipt number AILNDC-20113910. (Attachments: #1 Exhibit 1, #2 Exhibit 2, #3 Exhibit 3, #4 Exhibit 4, #5 Exhibit 5)(Conway, John) |
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