New Horizons Franchising Group Inc v. Cooke & Moses LLC et al

Filing 45

ORDER AND OPINION denying without prejudice 21 Motion for TRO; denying 21 Motion for Preliminary Injunction. Signed by Honorable J Michelle Childs on 6/29/2015.(asni, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF SOUTH CAROLINA
COLUMBIA DIVISION
New Horizons Franchising Group, Inc.,

)
)
Plaintiff,
)
v.
)
)
Cooke & Moses, LLC, The Green Owl, LLC )
Roy Lee Cooke, individually and as Personal )
Representative of the Estate of Betty Beach )
Cooke, Jeffrey H. Moses and Larraine L.
)
Moses,
)
)
Defendants.
)
____________________________________ )

Civil Action No. 3:14-cv-03333-JMC

ORDER AND OPINION

Plaintiff New Horizons Franchising Group, Inc. (“Plaintiff”) filed this action against
Defendants Cook & Moses, LLC, The Green Owl, LLC, Roy Lee Cooke, individually and as
Personal Representative of the Estate of Betty Beach Cooke, Jeffrey H. Moses and Larraine L.
Moses (“Defendants”), seeking to recover the unpaid balance due for royalty fees and for
merchandise sold and delivered under three franchise agreements guaranteed by Betty Beach
Cooke and Roy Lee Cooke. (See ECF Nos. 1, 15.)
This matter is before the court pursuant to a motion by Plaintiff for a temporary
restraining order (“TRO”) and preliminary injunction. (ECF No. 21.) For the reasons set forth
below, the court DENIES Plaintiff’s motion for a TRO and preliminary injunction without
prejudice.
I.

RELEVANT BACKGROUND TO THE PENDING MOTION

On August 18, 2014, Plaintiff filed this action against Defendants Cooke & Moses, LLC,
The Green Owl, LLC, Jeffrey H. Moses and Larraine L. Moses, seeking to recover the unpaid
balance due for royalty fees and for merchandise sold and delivered under three franchise

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agreements guaranteed by Betty Beach Cooke and Roy Lee Cooke. (See ECF Nos. 1, 15.)
Plaintiff also requested the court enjoin Defendants from using Plaintiff’s service mark and from
“engaging in any business regarding operation of a computer learning center within twenty-five
miles of the territories identified in the franchise agreement.” (ECF No. 15 at 12.) On June 4,
2015, the court granted Plaintiff’s Motion for Default Judgment against Defendant Roy Lee
Cooke as guarantor of the liability under the franchise agreements, awarding Plaintiff damages in
the amount of $404,272.72. (ECF No. 41 at 4-5.)
On December 1, 2014, Plaintiff filed this motion requesting a TRO and preliminary
injunction. (ECF No. 21.) Defendants filed no response, and a hearing was set for December 20,
2014. (ECF No. 24.) On December 30, 2014, the hearing was canceled as the parties had
informed the court they were close to settling the matter. (ECF No. 27.)
II.
A.

LEGAL STANDARD AND ANALYSIS

TROs and Preliminary Injunctions Generally
TROs and preliminary injunctions are governed by the same general standards. Hoechst

Diafoil Co. v. Nan Ya Plastics Corp., 174 F.3d 411, 422 (4th Cir. 1999). The court’s authority to
issue a preliminary injunction arises from Fed. R. Civ. P. 65. A party seeking a preliminary
injunction must establish all four of the following elements: (1) he is likely to succeed on the
merits; (2) he is likely to suffer irreparable harm in the absence of preliminary relief; (3) the
balance of equities tips in his favor; and (4) an injunction is in the public interest. Winter v.
Natural Res. Def. Council, Inc., 555 U.S. 7, 20 (2008); The Real Truth About Obama, Inc. v.
Fed. Election Comm’n, 575 F.3d 342, 346-47 (4th Cir. 2009). Only after the plaintiff makes a
clear showing that he is likely to succeed on the merits of his claim and that he is likely to be
irreparably harmed absent injunctive relief may the court consider whether the balance of

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equities tips in his favor. See Real Truth, 575 F.3d at 346-47. Finally, the court must pay
particular regard to the public consequences of employing the extraordinary relief of injunction.
See Real Truth, 575 F.3d at 347 (citing Winter, 55 U.S. at 24).
B.

Plaintiff’s Motion for Preliminary Injunction
Plaintiff seeks a preliminary injunction to require Defendants “to cease the use of the

New Horizon name and mark pending a final determination of this matter, prevent the use of
intellectual property which belongs to the Plaintiff” and to prevent Defendants from “engaging in
a computer learning business in the covered territories and within 25 miles of any network
learning center franchised by the Plaintiff.” (ECF No 21-4 at 1, 4.) Plaintiff claims that
Defendants have continued to indicate affiliation with New Horizons and use Internet services
that reference Plaintiff, and are attempting to take business away from Plaintiff to a new venture
called “Innovista Learning.” (Id. at 3.) To support these claims, Plaintiff presents affidavits
describing Defendants’ continued use of signs and a website that contain Plaintiff’s name and
mark and direct potential customers to “Innovista.” (ECF Nos. 21-1, 21-2, 21-3.) Defendants
present no response to this motion.
Upon review, the court finds that Plaintiff fails to address three necessary elements in
their motion – their likelihood to suffer irreparable harm in the absence of preliminary relief, the
balance of equities, and the public interest. 1 As such, the court cannot issue a preliminary
injunction.

The court acknowledges Plaintiff’s arguments on the likelihood they will succeed on the merits
(ECF No. 21-4 at 5-9), but does not decide these issues in the absence of the other factors
necessary for granting a preliminary injunction. The court also acknowledges the allegations in
the affidavit of Gregory E. Marsella (ECF No. 21-3 at 3) that Defendants’ continued actions are
“substantially hampering” Plaintiff’s ability to place a new franchise in the markets Defendants
previously covered, but requires more evidence to establish irreparable harm.
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III.

CONCLUSION

For the reasons set forth above, the court DENIES Plaintiff’s motion for TRO and
preliminary injunction without prejudice. (ECF No. 21.)
IT IS SO ORDERED.

United States District Judge
June 29, 2015
Columbia, South Carolina

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