Patsy's Brand, Inc. v. I.O.B. Realty, Inc., et al

Filing 305

OPINION AND ORDER re: 296 MOTION to Amend/Correct Motion to Clarify and/or Modify the Injunction. filed by I.O.B. Realty, Inc., Frank Brija. For the foregoing reasons, Defendants' motion to clarify and modify the permanent injunction is denied. SO ORDERED. (Signed by Judge Kimba M. Wood on 7/24/2020) (va)

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
--------------------------------------------------------X
PATSY’S BRAND, INC.,

USDC SDNY
DOCUMENT
ELECTRONICALLY FILED
DOC #: __________________
DATE FILED: July 24, 2020

Plaintiff,
v.
99-CV-10175 (KMW)
OPINION AND ORDER

I.O.B. REALTY, INC., PATSY’S INC.,
FRANK BRIJA, JOHN BRECEVICH, and
NICK TSOULOS,
Defendants.
--------------------------------------------------------X
KIMBA M. WOOD, United States District Judge:

Defendants have moved to clarify and modify the longstanding trademark injunction in
this case. (ECF No. 297.) The rancorous tenor of the present dispute belies a minor and
mundane issue concerning the permissible size of certain text on labels Defendants wish to use
for their packaged products. Specifically, Defendants seek the Court’s confirmation that they
may identify their goods as originating from “Patsy’s Pizzeria” in type that is equal in size to
other text on their labels without offending the injunction’s requirement that such an
identification constitute only a “minor component of the labeling.” In addition to their request
to clarify the permissible size of the identification relative to the other elements of the label,
Defendants seek to alter the injunction to allow the identification to exceed 10-point type.
Defendants argue that this relief is necessary in light of hardships they are suffering due to the
COVID-19 pandemic.
The trademark injunction is detailed and straightforward, and it does not prevent
Defendants from adapting their business to meet the challenges of the COVID-19 pandemic.
Defendants have not articulated an adequate basis for clarifying or modifying the injunction. For
the reasons set forth below, Defendants’ motion is DENIED.

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BACKGROUND
The history of this case is set out at length in previous decisions, including the decision of
the Court of Appeals for the Second Circuit in 2003 and this Court’s decision in 2006. Patsy’s
Brand, Inc. v. I.O.B. Realty, Inc., 317 F.3d 209, 212–15 (2d Cir. 2003); (2006 Opinion and Order
at 2–9, ECF No. 176.) Relevant background is briefly restated here.
A. The Injunction
This case emerges from a long and ever-expanding feud between two restaurants in New
York City: “Patsy’s Italian Restaurant,” owned by Plaintiff Patsy’s Brand, Inc., and “Patsy’s
Pizzeria,” owned by Defendant I.O.B. Realty. Plaintiff Patsy’s Brand Inc. has a trademark for a
stylized “Patsy’s” logo, which it has used on its jarred sauces since 1994.
In 1999, Plaintiff sued Defendants for trademark infringement after Defendants began
distributing their own jarred sauces. This Court granted Plaintiff’s motion for summary
judgment and denied Defendants’ cross-motion. Patsy’s Brand, Inc. v. I.O.B. Realty, Inc., No.
99-CV-10175, 2001 U.S. Dist. LEXIS 1625, at *42 (S.D.N.Y. Feb. 21, 2001) (Martin, J.). The
Court permanently enjoined Defendants from “manufacturing, importing, distributing,
advertising, promoting, selling, or offering for sale to the consuming public sauces or other
packaged food products bearing plaintiff’s trademark PATSY’s or plaintiff’s trade dress . . . or
any colorable variations thereof or any confusingly similar trademark or trade dress.” (ECF No.
82.) Finding that Defendants acted in bad faith in the course of the litigation, the Court ordered
them to pay Plaintiff’s attorneys’ fees and costs. Patsy’s Brand, Inc. v. I.O.B. Realty, Inc., No.
99-CV-10175, 2001 U.S. Dist. LEXIS 15555, at *2-3 (S.D.N.Y. Oct. 1, 2001) (Martin, J.) The
Court also held Defendant Isa “Frank” Brija in contempt for committing perjury and fraud and
sanctioned one of Defendants’ attorneys. Id. at *4, 8.

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In August of 2002, the Court found that Defendants had willfully violated the injunction;
the Court held Defendants in contempt, awarded Plaintiff attorneys’ fees and treble
compensatory damages, issued a coercive fine, and warned that the fine would increase tenfold
for a future violation. Patsy’s Brand, Inc. v. I.O.B. Realty, Inc., No. 99-CV-10175, 2002 U.S.
Dist. LEXIS 16066, at *7-9 (S.D.N.Y. Aug. 27, 2002) (Martin, J.).
In January of 2003, the Second Circuit affirmed the injunction in substantial part, while
introducing a minor modification. Patsy’s Brand, Inc. v. I.O.B. Realty, Inc., 317 F.3d 209, 220
(2d Cir. 2003). The Second Circuit determined that Defendants were entitled to include on their
product labels a “modestly sized identification” that the product comes from an establishment
that operates as “Patsy’s Pizzeria.” Id. That identification “must not exceed 10-point type, must
be a minor component of the labeling, must use the name ‘Patsy’s Pizzeria’ in full with the
lettering of both words in the same size and font, must not use a font that is similar to that used
by the Plaintiff, and must use the name only to identify the maker or distributor of the product.”
Id at 220–221. This language is at the center of the present dispute.
B. 2006 Litigation
In 2006, Defendants sought to modify the injunction under Rule 60(b) of the Federal
Rules of Civil Procedure. (2006 Opinion and Order at 10.) Defendants wished to add a
provision that would allow them to use a “Patsy’s Pizzeria” trademark on fresh and frozen
prepared pizzas to be sold wholesale. They submitted a proposed modification to the Court.
(Id.) The Court asked in response how the conduct that would be permissible under Defendants’
proposed modification would differ from the conduct allowed under the existing injunction
language. (Id. at n. 8.) Defendants answered, in relevant part, that the modification would
authorize them to use the name “Patsy’s Pizzeria” in type larger than 10-point. (Id.) In other

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words, Defendants sought in 2006 much the same result they seek again here. The Court denied
Defendants Rule 60(b) motion in 2006 as untimely and unjustified. (Id. at 24.)
C. 2019–2020 Contempt Litigation
Roughly one year ago, Plaintiff moved to hold Defendants in contempt for violating the
injunction. (ECF No. 183.) The Court conducted evidentiary hearings on October 30, 2019 and
December 12, 2019. Continued evidentiary hearings were scheduled for March 16, 19, and 20,
2020 but, due to the COVID-19 pandemic, the Court adjourned those hearings. Litigation
related to Plaintiff’s contempt motion remains suspended mid-hearing and will resume when it is
safe and practicable to entertain live courtroom proceedings.
D. Present Litigation to Clarify and Modify the Injunction
On June 2, 2020, Defendants filed a letting seeking the Court’s view as to whether a
proposed “bullseye”-style label (“the Proposed Bullseye Label”) would comply with the terms of
the trademark injunction:

(ECF No. 293.) Plaintiff objected that Defendants’ request was procedurally improper. Plaintiff
also argued, on the merits, that the proposed label violated the injunction: the identification
reading “MADE BY PATSY’S PIZZERIA” was not “equal to or less than 10-point type” or “a
minor component of the labeling,” as the injunction requires. (ECF No. 294.)

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The Court denied Defendants’ invitation to issue an advisory opinion on the
appropriateness of the Proposed Bullseye Label. (ECF No. 295.) Recognizing that the dispute
was minor, and crediting the parties’ avowed sensitivity to the unique challenges facing
restaurant businesses amidst the COVID-19 pandemic, the Court strongly encouraged the parties
to resolve the matter without the Court’s intervention. (Id.). The Court issued an Order directing
that, before either party filed a motion or other request for relief related to Defendants’ proposed
label, the filing party certify by affidavit that the parties conferred and made good-faith efforts to
arrive at a resolution, and that those efforts deteriorated to such a degree that communication and
reasonable compromise were no longer feasible. (Id.)
Fifteen days later, on June 18, 2020, Defendants filed the present motion seeking to
clarify and modify the injunction to allow Defendants to use the same Proposed Bullseye Label
that was the subject of their June 2, 2020 request. (Defendants’ Memorandum of Law in Support
of Motion to Clarify and/or to Modify the Injunction (“Defs. Mem.”) at 9, ECF No. 297.) On
July 2, 2020, Plaintiff filed a brief in opposition. (“Pl. Opp’n,” ECF No. 302.) In lieu of a reply,
Defendants submitted an affidavit by Defendant Brija. (ECF No. 304.)
LEGAL STANDARDS
District courts have discretion to clarify permanent injunctions. See A.V. by Versace, Inc.
v. Gianni Versace, S.p.A., 126 F. Supp. 2d 328, 334 (S.D.N.Y. 2001) (Leisure, J.).
“Clarifications of orders previously issued, which may be obtained on motion or made sua
sponte by the court, add certainty to an implicated party’s efforts to comply with the order and
provide fair warning as to what future conduct may be found contemptuous.” N.A. Sales Co. v.
Chapman Indus. Corp., 736 F.2d 854, 858 (2d Cir. 1984).

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District courts also have the authority to modify permanent injunctions. As relevant here,
a court may modify an injunction under Rule 60(b)(5) of the Federal Rules of Civil Procedure
where “applying it prospectively is no longer equitable” or under Rule 60(b)(6)’s “catchall”
provision “for any other reason that justifies relief.”
Relief under Rule 60(b)(5) is appropriate when the movant can show “a significant
change either in factual conditions or in law” that renders the underlying order inequitable. Rufo
v. Inmates of Suffolk Cnty. Jail, 502 U.S. 367, 384 (1992). Changes that may warrant relief
include those that make compliance with the order “substantially more onerous,” “unworkable
because of unforeseen obstacles,” or “detrimental to the public interest.” Id. Changed
circumstances that make compliance merely inconvenient will not suffice. Id. at 383. The
movant also bears the burden of demonstrating that “the proposed modification is suitably
tailored to the changed circumstances.” Id.
Relief under Rule 60(b)(6)’s catchall provision is appropriate when “extraordinary
circumstances” justify relief or the judgment risks working “an extreme and undue hardship.”
Pichardo v. Ashcroft, 374 F.3d 46, 56 (2d Cir. 2004) (quoting Matarese v. LeFevre, 801 F.2d 98,
106 (2d Cir. 1986). The provision is properly invoked only if “the asserted grounds for relief are
not recognized in clauses (1)–(5) of the Rule.” Nemaizer v. Baker, 793 F.2d 58, 63 (2d Cir.
1986).
A Rule 60(b) motion filed pursuant to either subsection (5) or (6)—or both—must be
made “within a reasonable time.” To determine whether a Rule 60(b) motion is timely, a court
“must scrutinize the particular circumstances of the case, and balance the interest in finality with
the reasons for delay.” PRC Harris, Inc. v. Boeing Co., 700 F.2d 894, 897 (2d Cir. 1983).

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DISCUSSION
I.

There is No Need to Clarify the Permanent Injunction

Defendants request that the Court clarify the portion of the permanent injunction that
permits them to include on their product labels an identification that the product comes from
“Patsy’s Pizzeria” so long as that identification constitutes “a minor component of the labeling.”
Defendants argue—and seek the Court’s agreement—that they may, within the bounds of the
injunction, display the words “Made by Patsy’s Pizzeria” on their labels in the same size type as
other elements of the label. They move to clarify that the injunction’s “minor component”
requirement is sensitive to factors including the placement and prominence of the identification.
Defendants make no effort to conceal that, by seeking this clarification, they wish the Court to
bless the Proposed Bullseye Label.
The injunction is clear; indeed, it is unusually detailed, down to the identification’s
maximum allowable type size. The injunction has operated for seventeen years without any
apparent need, until now, for clarification. The Court declines Defendants’ invitation to “clarify”
the injunction by passing judgment on the propriety of the Proposed Bullseye Label.
Instead, it will suffice to make two observations. First, the injunction speaks for itself,
and speaks plainly, on the subject of the parties’ quarrel. The injunction does not state that an
identification must be smaller than other text in order to constitute a minor component of a label.
From this silence it is evident that the injunction imposes no categorical rule as to the
identification’s permissible size relative to other elements of the label. And it demands not
“clarification” but common sense to confirm that the placement, prominence, and style of an
identification are relevant to whether the identification meets the definition of a minor
component.

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Second, “an injunction impose[s] a heavier burden on an infringing party with a
redesigned mark than is imposed on a newcomer with a similar mark.” Wella Corp. v. Wella
Graphics, Inc., 37 F.3d 46, 48 (2d Cir. 1994). Thus, a party subject to an injunction has a “duty
to keep a safe distance from the line drawn by the district court’s injunction.” Oral-B Labs., Inc.
v. Mi-Lor Corp., 810 F.2d 20, 24 (2d Cir. 1987). Even if the Proposed Bullseye Label complies
with the strict letter of the injunction, Defendants may be well served by pursuing designs that do
not give rise to close questions of interpretation.
The injunction needs no clarification. Whether Defendants can bring the Proposed
Bullseye Label to market without stirring allegations of contempt, and who might prevail if
Plaintiff brought suit, are not issues for the Court to decide today.
II.

Defendants Fail to Justify Modifying the Permanent Injunction

Separate from their request to clarify the permissible size of the identification relative to
the other components of the label, Defendants seek to modify the injunction to allow the
identification to exceed 10-point type. The injunction states, as it has for seventeen years, that
identifications “must not exceed 10-point type.” According to Defendants, this requirement is no
longer equitable, and Defendants should be permitted to affix to larger packages proportionately
larger identifications.
Defendants claim that this modification is warranted under Rule 6(b)(5) in light of the
changed circumstances brought about by the COVID-19 pandemic. But Defendants fail to
demonstrate a credible nexus between the COVID-19 pandemic and the modification they seek.
As an initial matter, it appears likely that Defendants are wielding the COVID-19
pandemic as a pretext for their attempt to do away with a rule they have long found inconvenient.
The pandemic is new, but Defendants’ desire to expand their packaged food business, and to

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eliminate the injunction’s type-size restriction to further that end, is not. In 2006, Defendants
argued that the injunction was no longer equitable because it hindered their ability to “follow the
natural progression of [their] business . . . and expand to sales of wholesale pizza ingredients.”
(2006 Opinion and Order at 12 (quoting 2006 Defs. Mem. at 19).) They sought a modification
because the 10-point type rule “severely limit[ed] the recognizability” of their brand. (Id. at n. 8.
(quoting 2006 Defs. Mem. at 7).) The Court denied the motion. (2006 Opinion and Order at
24.) Here, too, Defendants express their goal of “transitioning to packaged food,” and seek to
modify the injunction’s 10-point type rule so that they can “inform consumers, in legible font,
that their packaged food products are ‘Made by Patsy’s Pizzeria.’” (Defs. Mem. at 12.) In other
words, the pandemic seems to serve, for Defendants, as a novel hook for achieving an old
objective. This conclusion is buttressed by the fact that Defendants request not a limited
modification for the duration of the pandemic, but an indefinite one.
But even if the COVID-19 pandemic was the genuine, and not pretextual, reason for
modifying the injunction’s type-size restriction, Defendants fail to demonstrate that the
modification is properly tailored to reducing the hardships associated with the pandemic. The
injunction’s type-size restriction does not prevent Defendants from transitioning to packaged
food sales, as they claim they must in order to stay afloat. Defendants are, and always have
been, free to sell packaged food, so long as their labels comply with the terms of the injunction.
Defendants argue that if they cannot identify their products as “Made by Patsy’s Pizzeria” in
sufficiently large type, customers will be “unlikely to trust” that the products “come from the
same establishment that owns the PATSY’S PIZZERIA restaurants.” (Defs. Mem. at 6–7, 12.)
But Defendants admit that they “will sell their products through their own restaurants.” (Id. at
13.) Thus, the fact that the products come from Patsy’s Pizzeria restaurants will be

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unmistakable. The notion that the injunction’s type-size restriction leaves Defendants “without
the ability to alter their business to meet customer needs in a pandemic” is specious and
hyperbolic. (Id. at 12.) That the injunction prevents Defendants from selling packaged food in
the manner they consider ideal—that is, with an identification in larger than 10-point type—does
not render it so onerous, unworkable, or otherwise inequitable in the context of the COVID-19
pandemic as to merit modification.
Defendants do not assert a basis for relief under subsection (6) of Rule 60(b) that is
separate from the basis they assert under subsection (5), nor do they set forth “extraordinary
circumstances” justifying relief apart from the same injuries of which they have complained
since at least 2006. These failures are fatal to their claim under Rule 60(b)(6). See Tapper v.
Hearn, 833 F.3d 166, 172 (2d Cir. 2016).
CONCLUSION
For the foregoing reasons, Defendants’ motion to clarify and modify the permanent
injunction is denied.
SO ORDERED.
Dated: New York, New York
July 24, 2020

/s/ Kimba M. Wood
KIMBA M. WOOD
United States District Judge

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