Choice Hotels International, Inc. v. Fisher et al

Filing 38

ORDER GRANTING PLAINTIFFS MOTION FOR SUMMARY JUDGMENT AGAINST DEFENDANT JAMES G. FISHER, II, AND DENYING DEFENDANTS MOTION FOR PARTIAL SUMMARY JUDGMENT: granting 30 Motion for Summary Judgment; denying 32 Motion for Partial Summary Judgment. A trial on the issues of monetary damages shall take place as scheduled on May 13, 2014. The defendants Counterclaim 24 is hereby DISMISSED. As such, the Clerk is DIRECTED to enter a separate Judgment in favor of the plaintiff on the Counterclaim. Signed by Chief Judge John Preston Bailey on 2/27/14. (njz)

THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
ELKINS

CHOICE HOTELS INTERNATIONAL, INC.,
Plaintiff,
v.

Civil Action No. 2:13-CV-23
(BAILEY)

JAMES G. FISHER, II and
PATRICIA FISHER,
Defendants.

ORDER GRANTING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT
AGAINST DEFENDANT JAMES G. FISHER, II, AND DENYING DEFENDANT’S
MOTION FOR PARTIAL SUMMARY JUDGMENT
On this day, the above-styled matter came before this Court for consideration of the
parties’ cross Motions for Summary Judgment [Docs. 30 & 32]. Having been fully briefed,
the Motions are now ripe for disposition.1 For the reasons stated below, the Plaintiff’s
Motion for Summary Judgment [Doc. 30] is GRANTED, and the Defendant’s Motion for
Partial Summary Judgment [Doc. 32] is DENIED.
I.

Facts
This is a civil action brought by Choice Hotels seeking damages and injunctive relief

arising out of a franchise agreement for an Econo Lodge facility in Elkins, West Virginia.
According to the Complaint [Doc. 1], on or about May 16, 1995, Choice Hotels entered into

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This Court notes that while the defendant did not file a reply to his Motion, the time
period to do so has expired.
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a Franchise Agreement with James G. Fisher, II and Patricia P. Fisher,2 which permitted
Fisher to operate an Econo Lodge hotel franchise at Route 1, Box 15, Elkins, West Virginia.
[Doc. 23, ¶ 34]. The Franchise Agreement specifically licensed the Econo Lodge family
of marks to the Fishers for so long as the Franchise Agreement remained in effect. [Doc.
23, ¶ 35].
Paragraph 12 of the Franchise Agreement provides that upon termination, the
Fishers must immediately discontinue use of Proprietary Marks belonging to Choice Hotels
and specifically prohibits the Fishers from identifying the hotel at the Subject Property as
an Econo Lodge or former Econo Lodge hotel. [Doc. 23, ¶ 36].
According to the Amended Complaint, prior to February 19, 2009, the Fishers
defaulted on their material obligations under the Franchise Agreement. [Doc. 23, ¶ 37].
On or about February 19, 2009, Choice Hotels issued a Notice of Termination, via Certified
Mail, to the Fishers. [Doc. 23, ¶ 38].
On or about June 17, 2009, Choice Hotels and the Fishers entered into a
Reinstatement Agreement which permitted the Fishers to bring the Subject Property back
into the Choice Hotels system upon completion of renovations at the Subject Property and
the Fisher’s demonstrated compliance with Choice Hotels’ brand standards. [Doc. 23,
¶ 39]. The Reinstatement Agreement specifically provided that the renovations and brand
compliance had to be completed “before entering the ECONO LODGE System, but in no
event later than twelve (12) months after execution of this Agreement.” [Doc. 23, ¶ 40].
The Fishers did not make the necessary renovations or establish compliance with Choice
2

On April 26, 2013, defendant James Fisher, II filed a Suggestion of Death noting
that Patricia Fisher died in July, 2012 [Doc. 10].
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Hotels’ brand standards by the June 17, 2010, deadline. [Doc. 23, ¶ 41].
Choice Hotels issued multiple Notices of Default to the Fishers (September 22,
2010; September 27, 2010; and May 23, 2011), all via either certified mail or FedEx,
advising the Fishers of the defaults and providing them with an opportunity to take curative
action. [Doc. 23, ¶ 44]. The Fishers did not cure the defaults. [Doc. 23, ¶ 45].
Accordingly, on or about November 14, 2011, Choice Hotels issued a Notice of
Termination, via FedEx, to the Fishers. [Doc. 23, ¶ 46]. The Notice of Termination
instructed the Fishers to immediately cease and desist use of any and all marks owned by
Choice Hotels. [Doc. 23, ¶ 47]. Fisher continued to utilize the name and marks of Choice
Hotels, and this litigation ensued. [Doc. 23, ¶ 52].
II.

Procedural History
The plaintiff filed its Complaint in this Court on March 21, 2013 [Doc. 1]. Thereafter,

plaintiff filed its Amended Complaint [Doc. 23] on August 1, 2013.3

The Amended

Complaint alleges claims against former franchisee James Fisher, II for federal trademark
infringement, federal unfair competition, common law trademark infringement / unfair
competition, and breach of contract. The plaintiff seeks, inter alia, injunctive relief forever
enjoining the defendant from using any of the ECONO LODGE family of marks, damages
under the Lanham Act, and damages resulting from breach of the Franchise Agreement
and Reinstatement Agreement.
On August 21, 2013, the defendants filed their Answer [Doc. 24] to the Amended
Complaint, wherein defendants assert a Counterclaim against the plaintiff for breaching the
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The Amended Complaint [Doc. 23] asserts the additional claim for breach of

contract.
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Franchise Agreement by terminating it without cause. Defendant’s Motion for Partial
Summary Judgment asserts, inter alia, statute of limitations defenses.
III.

Legal Standard
Rule 56 provides that summary judgment is appropriate “if the pleadings,

depositions, answers to interrogatories, and admissions on file, together with the affidavits,
if any, show that there is no genuine issue as to any material fact and that the moving party
is entitled to a judgment as a matter of law.” FED. R. CIV. P. 56(c); see Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986). A genuine issue exists “if the evidence is such that a
reasonable jury could return a verdict for the non-moving party.” Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 250 (1986). Thus, the Court must conduct “the threshold
inquiry of determining whether there is the need for a trial -- whether, in other words, there
are any genuine factual issues that properly can be resolved only by a finder of fact
because they may reasonably be resolved in favor of either party.” Anderson, 477 U.S.at
250.
Additionally, the party opposing summary judgment “must do more than simply show
that there is some metaphysical doubt as to the material facts.” Matsushita Elec. Indus.
Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). That is, once the movant has
met its burden to show absence of material fact, the party opposing summary judgment
must then come forward with affidavits or other evidence demonstrating there is indeed a
genuine issue for trial.

Fed. R. Civ. P. 56(c); Celotex Corp., 477 U.S. at 323-25;

Anderson, 477 U.S. at 248. “If the evidence is merely colorable, or is not significantly
probative, summary judgment may be granted.” Anderson, 477 U.S. at 249 (citations

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omitted).
IV.

Discussion
Plaintiff’s Motion for Summary Judgment
Plaintiff seeks summary judgment on all counts and on the Counterclaim. The

defendant’s entire response argues that a genuine issue of material fact exists as to the
identity of the entity allegedly infringing upon the plaintiff’s ECONO LODGE marks. The
defendant asserts that the subject hotel is operated by a third party, Crossroads Hospitality,
Inc. This Court will address each argument in turn.
A.

Federal Trademark Infringement (Count I)

“To establish a trademark infringement under the Lanham Act, a plaintiff must prove:
(1) that it owns a valid mark; (2) that the defendant used the mark ‘in commerce’ and
without plaintiff’s authorization; (3) that the defendant used the mark (or an imitation of it)
‘in connection with the sale, offering for sale, distribution, or advertising’ of goods or
services; and (4) that the defendant’s use of the mark is likely to confuse consumers.”
Rosetta Stone Ltd. v. Google, Inc., 676 F.3d 144, 152 (4th Cir. 2012)(citing 15 U.S.C.
§ 1114(a)).
Plaintiff alleges, and the defendant admits that it owns the various ECONO LODGE
family of marks. See [Doc. 24, at ¶ 17]. It is further undisputed that the defendant “used
the mark . . . ‘in connection with the sale, offering for sale, distribution, or advertising’ of
goods or services.” (Id. at ¶ 34). This Court also finds that there is no dispute that the
defendant’s continued use of the mark would confuse consumers. The only element of
trademark infringement that is in dispute appears to be whether the defendant’s use of the

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mark is without the plaintiff’s authorization. This dispute is two-pronged: The defendant
asserts first, that his use of the marks is valid and second, that the true party in interest is
Crossroads Hospitality, Inc.
“A plaintiff asserting an infringement claim under the Lanham Act must prove that
it has a valid, protectable trademark and that the defendant is infringing its mark by creating
confusion, or a likelihood thereof, by causing mistake, or by deceiving as to the attributes
of its mark. See 15 U.S.C. §§ 1114, 1125; Petro Stopping Ctrs., L.P. v. James River
Petroleum, Inc., 130 F.3d 88, 91 (4th Cir. 1997). In determining whether the plaintiff has
proven a likelihood of confusion, we consider, among other factors, ‘(1) the strength or
distinctiveness of the plaintiff’s mark, (2) the similarity of the two parties’ marks, (3) the
similarity of the goods and services the marks identify, (4) the similarity of the facilities the
two parties use in their businesses, (5) the similarity of advertising used by the two parties,
(6) the defendant’s intent, and (7) actual confusion.’ Petro Stopphing Ctrs., 130 F.3d at
91 (citing Pizzeria Uno Corp. v. Temple, 747 F.2d 1522, 1527 (4th Cir. 1984)).” Lyons
P’ship, L.P. v. Morris Costumes, Inc., 243 F.3d 789, 804 (4th Cir. 2001).
The Court went on to stress that “the seventh factor – actual confusion – is often
paramount. When the plaintiff’s mark is strong and the defendant’s use of a similar mark
‘has actually confused the public, our inquiry ends almost as soon as it begins.’ Sara Lee,
81 F.3d at 467.” Id. This Court can think of no better example of consumer confusion than
that of a former franchise carrying on as if it were still a franchise. Continuing to do so
represents the epitome of trademark infringement, the purpose of a franchise being the use
that franchiser’s particular trademark to conduct its business. See BLACK’S LAW DICTIONARY

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668 (7th ed. 1999). Such is the case sub judice.
This Court finds the defendant’s claim that there is a genuine issue of material fact
regarding the true party in interest to be disingenuous. First, the Franchise Agreement
[Doc. 1-9] is between the plaintiff and the Fishers. Second, Paragraph 10 of the Franchise
Agreement provides that any assignment must have the written consent of the Franchisor,
and that any assignment without such consent is null and void. Defendant has presented
no evidence that any assignment was approved or consented to by the plaintiff. Third,
Crossroads Hospitality was formed by the Fishers, and the entirety of the Board of
Directors is comprised of Mr. Fisher and his since deceased wife. Fourth, regardless of the
corporate structure, defendant Fisher remains personally liable for the acts of infringement.
Under West Virginia law, “a corporation can act only through its agents or employees.”
Cook v. Heck’s, Inc., 176 W. Va. 368, 375, 342 S.E.2d 453, 460 (1986). In, Musgrove
v. Hickory Inn, Inc., 168 W. Va. 65, 69 (1981), the West Virginia Court of Appeals stated:
“In this jurisdiction a joint action of tort may be instituted against a
master and servant in a case in which plaintiff’s injuries were occasioned
solely by the negligence of the servant, ... The relation of master and servant
in those cases, in which the doctrine of respondeat superior applies, is joint,
and the parties should be regarded as though they were joint tortfeasors.
Wills v. Montfair Gas Coal Co., 97 W. Va. 476, 125 S.E. 367. In some
respects, however, the relation may be regarded as joint, and several.” 139
W. Va. at 111, 79 S.E.2d at 289-90.
See also O’Dell v. Univeral Credit Co., 118 W. Va. 678, 191 S.E. 568

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(1937). Joint and several liability allows the plaintiff to sue either or both.
Muldoon v. Kepner, 141 W. Va. 577, 91 S.E.2d 727 (1956)(citations
omitted).
[T]he doctrine of respondeat superior does not relieve the servant of
his tort liability. This principle rests on the fact that an agent or employee can
be held personally liable for his own torts against third parties and this
personal liability is independent of his agency or employee relationship. This
same rule is generally accepted elsewhere. (Citations omitted).
Musgrove, 168 W. Va. at 69.
In Musgrove, the Court held that “insofar as the individual liability of the [defendants]
is concerned, the fact that they were acting individually or as agents is irrelevant. If they
tortiously injured the plaintiff, they are liable.” 168 W. Va. at 69. It follows that defendant
Fisher’s infringing conduct may give rise to both his individual liability and the liability of the
corporate entity on whose behalf he was acting. Accordingly, the plaintiff asserts that the
existence of Crossroads Hospitality is irrelevant to the inquiry of whether defendant Fisher
infringed on Choice Hotels’ trademarks. This Court agrees. The facts clearly establish that
Fisher was, and continues to run a one-man operation, and any acts of infringement
alleged are directly attributable to him. Accordingly, having established all the essential
elements, the Motion for Summary Judgment is GRANTED insofar as it pertains to Count
I.
B.

Federal Unfair Competition (Count II)

The test for unfair competition under the Lanham Act is similar to that for

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infringement. Under Section 43(a) of the Lanham Act for Federal Unfair Competition, the
plaintiff must show: (1) that it owns a valid protectable mark and (2) that the defendant’s
use of a colorable imitation of that mark creates a likelihood of confusion. See 15 U.S.C.
§ 1125; Lone Star Steakhouse & Saloon, Inc. v. Alpha of Virginia, Inc., 43 F.3d 922,
930 (4th Cir. 1995).
Again, it is not disputed that the ECONO LODGE marks at issue are valid and
protectable. Furthermore, the marks continue to be used by the defendant in such a way
to create a likelihood of confusion. The hotel at the Subject Property, a former Econo
Lodge hotel, simply continues to carry on at least to some degree as if it were still an Econo
Lodge franchise.

Accordingly, having established the essential elements for Unfair

Competition, the Motion for Summary Judgment is GRANTED insofar as it pertains to
Count II.
C.

Common Law Trademark Infringement – Unfair Competition (Count III)

The Supreme Court of Appeals of West Virginia has applied tests similar to the
federal counterparts for trademark infringement and unfair competition. See Foglesong
v. Foglesong Funeral Home, Inc., 149 W. Va. 454 (1965). Again, the focus is on
confusion and injury. This Court will not belabor the point. For the same reasons stated
above in Sections A and B, this Court GRANTS the Motion for Summary Judgment as to
Count III.
D.

Breach of Contract (Count IV)

“In West Virginia, the elements of breach of contract are (1) a contract exists
between the parties; (2) a defendant failed to comply with a term in the contract, and (3)

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damage arose from the breach.” Patrick v. PHH Mortgage Corp., 937 F.Supp.2d 773,
792 (N.D. W.Va. 2013)(citing Wince v. Easterbrooke Cellular, Corp., 681 F.Supp.2d 688,
693 (N.D. W.Va. 2010)).
Plaintiff asserts in its Motion that the defendant has admitted all the essential
elements for this breach of contract by failing to respond to the Request for Admissions
propounded by Choice Hotels.
There is no dispute that a contract exists between the parties; i.e. the Franchise
Agreement and Reinstatement Agreement. Further, the defendant defaulted on his
material obligations under the Franchise Agreement and Reinstatement Agreements,
constituting a breach thereof. As will be further explained below, the plaintiff suffered
damages as a result of the breach. Having satisfied the necessary elements for breach of
contract, this Court GRANTS the Motion for Summary Judgment as to Count IV.
E.

Defendant’s Counterclaim for Breach of Contract

Defendant Fisher asserted a counterclaim in his Answer for breach of contract
against the plaintiff. Plaintiff previously filed a Motion to Dismiss the counterclaim [Doc. 13],
which this Court denied by Order dated July 10, 2013 [Doc. 18]. At that time, this Court
found that “[w]hile the allegations of the counterclaim appear[ed] to be bare bones” they
were “sufficient to withstand the Rule 12(b)(6) challenge.” (Id. at p. 5).
This matter is presently before the Court on summary judgment. Since its Order
Denying the Motion to Dismiss the counterclaim, the plaintiff has issued its Interrogatories
and Requests for Production of Documents [Docs. 28 & 29]. These inquiries asked the
defendant to produce, inter alia, any evidence in defendant’s possession that would support

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its claim that the plaintiff terminated the Franchise Agreement without cause, or that would
support any damages claim by the defendant. (Interrogs. 20 & 21); (Request for Prod. 21).
Plaintiff Fisher never responded to any of these requests. As such, this Court finds that the
defendant cannot produce any evidence to support his counterclaim. Accordingly, this
Court GRANTS summary judgment in favor of the plaintiff as to the defendant’s breach of
contract counterclaim. Accordingly, the Counterclaim is hereby DISMISSED.
Defendant’s Motion for Partial Summary Judgment
A.

Applicable Statute of Limitations for Counts I, II, and III

The defendant asserts a two year statute of limitations for the above counts pursuant
to West Virginia Code § 55-2-12. The plaintiff is willing to concede this limitations period
for the sake of argument, asserting its claims are timely regardless of the limitations period
applied. This Court agrees.
The defendant argues that the clock began on plaintiff’s claims on May 8, 2009. By
Notice of Termination dated February 19, 2009, the plaintiff terminated the Franchise
Agreement and declared that any use of its proprietary marks must cease immediately. On
May 8, 2009, Fisher executed a Reinstatement Agreement, which contained several
remedial measures which the plaintiff required the defendant to make. Plaintiff filed its
Complaint on March 21, 2013.
The defendant asserts that the alleged acts of infringement are not a “continuing
harm” which would restart the accrual of the date of injury. The plaintiff disagrees, stating
that Fisher has continued to commit new acts of infringement as recently as December of
2013. Additionally, the plaintiff asserts that the termination of the Franchise Agreement /

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Reinstatement Agreement which gave rise to this matter occurred on November 14, 2011,
well within the limitations period. It is this second breach and termination which the plaintiff
claims gives rise to the causes of action in this case. On June 21, 2012, Choice Hotels
issued a Notice of Infringement to defendant Fisher. The Complaint was filed nine (9)
months later.
The plaintiff cites Lyons P’ship, L.P. v. Morris Costumes, Inc., 243 F.3d 789, 797
(4th Cir. 2001), for the proposition that “the statute of limitations does not shield the
defendant from liability for wrongful acts actually committed during the limitations period,
and its rationale applies equally to trademark infringement claims brought under the
Lanham Act.” The defendant asserts, however, that Lyons is inapplicable under the
express terms of the Franchise Agreement, whereby the defendant claims the parties
contracted out such a theory and agreed to limit claims against each other from the date
they arose. Specifically, the defendant points to Paragraph 21(k) of the 1995 Franchise
Agreement [Doc. 23-9], which states:
21(k) Any claim arising out of or related to this Agreement which is not filed
within three years of the date on which the claim arose shall thereafter be
barred, unless applicable law provides for a shorter statute of limitations.
The defendant relies on Harbor Court Associates v. Leo A. Daly Co., 179 F.3d
147 (4th Cir. 1999), to support his assertion that the parties have altered the accrual of
claims by contract.

While that case does permit such agreements, the contractual

language in this case does not attempt to limit the accrual of claims. In Harbor, the
contractual limitation applied to “all acts or failures to act” and stated that “any alleged

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cause of action shall be deemed to have accrued in any and all events” not later than a
specified time. 179 F.3d at 148. The instant case is readily distinguishable because the
survival clause at issue here is not so narrowly written. The provision at issue in this case
simply makes no mention of accrual of actions.
The defendant’s interpretation of this provision is thus misplaced. Although the
contractual language contains the phrase “date on which the claim arose,” its plain meaning
does not change. Nor does the subject provision place any limiting language on its accrual.
In the Fourth Circuit, it is clear that “each [act] should be considered separately under an
infringement analysis.” Lyons, 243 F.3d at 797. Further, “a ‘party does not waive the right
to sue for infringements that accrue within three years of filing by not asserting related
claims that accrued beyond three years.’” Id. (quoting Hotaling v. Church of Jesus Christ
of Latter-Day Saints, 118 F.3d 199, 202 (4th Cir. 1997)). Here, Choice Hotels has
established acts constituting new acts of infringement well within the limitations period.
Accordingly, the defendant’s Motion is DENIED insofar as it pertains to this argument.
B.

Applicable Statute of Limitations for Count IV

Next, the defendant asserts that to the extent that the plaintiff is alleging breach of
the Franchise Agreement in Count IV, the same is barred by the applicable statute of
limitations period. Defendant Fisher asserts that by letter dated November 12, 2008,
Choice Hotels declared that Fisher had breached the Franchise Agreement. Defendant
concedes that the parties executed the Reinstatement Agreement on June 17, 2009, but
denies that this “somehow resuscitate[d] claims which ‘arose’ sometime before” that. [Doc.
32-1]. In asserting this argument, the defendant again relies on the contractual provision

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at Paragraph 21(k).
Under West Virginia law, contracts enjoy a 10-year limitations period. See W. Va.
Code § 55-2-6. It is clear, however, that the parties contracted to shorten that period. The
plaintiff thus argues in the alternative that even if the parties contracted for a shorter
limitations period, it nevertheless timely filed its claims. Choice Hotels points to its
Reinstatement Agreement, which it terminated on November 14, 2011, when it issued the
Notice of Termination. The Reinstatement Agreement provided that specific renovations
be made and brand compliance be completed “in no event later than twelve (12) months
after execution of [the Reinstatement Agreement].” [Doc. 23, ¶ 40]. The parties entered
into the Reinstatement Agreement on June 17, 2009. Therefore, this Court finds the
breach thereof occurred on June 17, 2010. Choice Hotels filed its breach of contract claim
against Fisher on March 21, 2013, within the three-year limitations period. Accordingly, this
Court finds the breach of contract claim was timely filed, and the Motion must be DENIED
insofar as it pertains to this argument.
C.

Damages for Breach of Reinstatement Agreement (Count IV)

Under the Reinstatement Agreement, the parties agreed that Fisher would (1) pay
a penalty of $10,000, which he did pay, and (2) make certain repairs within one year, in
which case Choice Hotels would permit the hotel to reenter the franchise system and be
permitted to continue using Choice Hotels’ marks.
The defendant asserts that Choice Hotels cannot demonstrate any damages
resulting from the alleged breach of the Reinstatement Agreement because, by the express
terms therein, Choice Hotels’ duty to perform did not arise until Fisher completed the
repairs. Only then would Choice Hotels have a duty to accept Fisher’s hotel back into the
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franchise system and reauthorize the use of its marks. Thus, the defendant asserts that
because he never completed the requisite repairs, Choice Hotels’ duty never arose;
accordingly, Choice was never required to nor did it perform and no damages were suffered
as a result therefrom.
The plaintiff asserts that Fisher’s breach of the Reinstatement Agreement was
clearly injurious to Choice Hotels because it prohibited Fisher from reentering the franchise
system and serving as an income-generating franchisee under his Franchise Agreement,
thereby creating an immediate and direct economic impact on Choice Hotels. Further, the
Franchise Agreement specifically provides for liquidated damages in Paragraph 11. Thus,
this Court finds that the plaintiff can show damages for breach of contract. Accordingly, the
Motion is DENIED insofar as it pertains to this argument.
Damages
A.

Permanent Injunction
Given the ongoing trademark infringement by the defendant in violation of 15 U.S.C.

§ 1114, plaintiff requests permanent injunctive relief under 15 U.S.C. § 1116. Section 1116
states: “The . . . courts . . . shall have power to grant injunctions, according to the
principles of equity and upon such terms as the court may deem reasonable, to prevent the
violation of any right of the registrant of a mark registered in the Patent and Trademark
Office . . ..”
To be granted a permanent injunction, the plaintiff in an action involving trademark
infringement must satisfy the traditional permanent-injunction analysis. Mary Kay Inc. v.
Ayres, 827 F.Supp.2d 584, 595 (D. S.C. 2011). Thus, the plaintiff must show that:

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(1) it has “suffered an irreparable injury;”
(2) the “remedies available at law are inadequate;”
(3) “the balance of the hardships favors” it being granted an injunction; and
(4) “the public interest would not be disserved by the injunction.”
PBM Products, LLC v. Mead Johnson & Co., 639 F.3d 111, 126 (4th Cir. 2011).
In Lone Star Steakhouse & Saloon, Inc., v. Alpha of Virginia, Inc., the Fourth
Circuit stated that “an injunction is the preferred remedy to insure that future violations will
not occur” in a trademark infringement action. 43 F.3d 922, 939 (4th Cir. 1995) (internal
quotation marks omitted). The Court also noted that plaintiffs in infringement actions “need
not . . . offer[ ] specific evidence of irreparable injury,” given that “irreparable injury regularly
follows from trademark infringement.” Id. Though it has not directly endorsed it, the Fourth
Circuit has recognized that a “presumption of irreparable injury is generally applied once
the plaintiff has demonstrated a likelihood of confusion, the key element in an infringement
case.” Scotts Co. v. United Indus. Corp., 315 F.3d 264, 273 & n. 3 (4th Cir. 2002) (noting
that district courts within the circuit have applied the presumption). Additionally, the Lone
Star Court noted that “an injunction in [a trademark infringement case] would serve the
public interest by preventing future consumers from being misled.” 43 F.3d at 939.
Despite the contractual relationship between the plaintiff and defendant, it is
apparent that Choice Hotels has been powerless to ensure the quality of defendant's
operation and that the defendant's failed compliance with brand specifications will continue
to undermine the public's faith in the plaintiff’s products and damage the plaintiff’s
reputation in the industry with their existing and potential customers. This clearly subjects

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the plaintiff to irreparable injury. Plaintiffs have also shown that the remedies at law are
inadequate and that the balance of the hardships favors their being granted an injunction.
Despite plaintiff’s numerous attempts to resolve this dispute, and sending numerous letters,
making multiple calls, and filing this lawsuit, the defendant continues to use the plaintiff’s
marks at his business establishment. His infringement is not being thwarted by contact with
plaintiff’s counsel or by legal action. Defendant's inaction “demonstrates [his] refusal to
acknowledge [his] legal obligations, makes the threat of continued infringement likely, and
underscores the ineffectiveness of a remedy at law.” Mary Kay, 827 F.Supp.2d at 596
(internal quotation marks omitted). The balance of the hardships also favors granting a
permanent injunction. The defendant is merely being stopped from infringing upon the
plaintiff’s trademarks. Thus, the plaintiff has satisfied the traditional permanent-injunction
analysis.
As such, this Court ORDERS that defendant Fisher shall forever be enjoined from
using any of the marks in the ECONO LODGE family of marks, including but not limited to,
the marks appearing in the ‘642, ‘814, ‘518, ‘530, ‘688, ‘065, ‘067, and ‘199 Registrations,
or any mark similar thereto. It is further ORDERED that the defendant immediately remove
all signage, advertisements, menus, websites or any other indicia bearing any of the marks
in the ECONO LODGE family of marks and to destroy any such item in his custody or
control. Pursuant to 15 U.S.C. § 1116(a), within thirty (30) days of this Order, defendant
Fisher shall file a sworn statement of compliance setting forth in detail the manner and form
in which the defendant has complied with this injunction.
Finally, a trial on the issues of monetary damages shall take place as scheduled on

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May 13, 2014.
CONCLUSION
For the reasons stated above, the Plaintiff’s Motion for Summary Judgment [Doc.
30] is GRANTED, and the Defendant’s Motion for Partial Summary Judgment [Doc. 32]
is DENIED. The defendant’s Counterclaim [Doc. 24] is hereby DISMISSED. As such, the
Clerk is DIRECTED to enter a separate Judgment in favor of the plaintiff on the
Counterclaim.
It is so ORDERED.
The Clerk is directed to transmit copies of this Order to all counsel of record herein.
DATED: February 27, 2014.

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