840 F.2d 72 (D.C. Cir. 1988), 87-7025, Williams & Humbert Ltd. v. W. & H. Trade Marks (Jersey) Ltd.

Docket Nº:87-7025.
Citation:840 F.2d 72
Party Name:199, 5 U.S.P.Q.2d 1870 WILLIAMS & HUMBERT LIMITED v. W. & H. TRADE MARKS (JERSEY) LIMITED, Jose Maria Ruiz-Mateos, et al., Appellants.
Case Date:February 23, 1988
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit

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840 F.2d 72 (D.C. Cir. 1988)

199, 5 U.S.P.Q.2d 1870




Ruiz-Mateos, et al., Appellants.

No. 87-7025.

United States Court of Appeals, District of Columbia Circuit

February 23, 1988

Argued Dec. 14, 1987.

Appeal from the United States District Court for the District of Columbia (Civil Action No. 83-01905).

James M. Amend, with whom Jeffrey S. Davidson, David G. Norrell and Steven M. Wellner, Washington, D.C., were on the brief, for appellants.

Jack C. Berenzweig, Chicago, Ill., with whom John D. Nies, Arlington, Va., was on the brief, for appellee.

Before D.H. GINSBURG and SENTELLE, Circuit Judges, and MARKEY, [*] Chief Judge.

Opinion for the Court filed by Circuit Judge SENTELLE.

SENTELLE, Circuit Judge:

This is an appeal from an order of the District Court denying an application for intervention under Rule 24 of the Federal Rules of Civil Procedure. Appellants contend

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that the order of the District Judge denying their application was not supported by the record. We agree and, therefore, reverse and remand.


The appellants are six related individuals 1 known collectively herein as "the family." At one time, the family owned all the shares of Rumasa, S.A. (Rumasa), a Spanish corporation with various holdings including almost complete ownership of Williams & Humbert Group Limited (Group), an English corporation. 2 Group and its wholly owned subsidiary Williams & Humbert International Limited in turn owned all the shares of Williams & Humbert Limited (Williams & Humbert), plaintiff below and appellee here. Williams & Humbert owned the valuable Dry Sack trademarks, registered to it in the United States, the United Kingdom, and other countries, under which it marketed a premium brand of sherry. It is the United States Dry Sack trademarks that are the subject of this action. 3

The family, all citizens of Spain, concerned for some time that the Spanish government would expropriate its direct holdings in Rumasa or Rumasa's holdings, established W. & H. Trade Marks (Jersey) Limited (W & H), a corporation of Jersey in the Channel Isles, in 1976, with all of its shares held by or for the family. Williams & Humbert and W & H executed a Master Agreement that purported to transfer Williams & Humbert's worldwide trademarks, including the United States Dry Sack trademarks, to W & H and grant Williams & Humbert a license to use the trademarks that was nevertheless terminable by W & H in the event (among others) that the stock of Rumasa was expropriated by Spain.

In 1983, Spain did expropriate the family's Rumasa stock, and thereupon W & H purported to terminate Williams & Humbert's worldwide licenses to the trademarks under the Master Agreement. Williams & Humbert, now effectively controlled by the government of Spain by reason of its expropriation of all the shares of the grandparent corporation, brought suit against W & H and the family in Jersey seeking a judgment that W & H's shares were held on constructive trust for Williams & Humbert. In England, Williams & Humbert sued W & H to set aside the Master Agreement and to reclaim the trademarks ostensibly conveyed thereby. (The family intervened as defendants alongside W & H in the English action.) Williams & Humbert also brought this action against W & H (but not the family) in 1983. W & H, although represented, never answered here; instead, the action below was stayed by a consent order pending the outcome of the litigation in the United Kingdom.

In 1986, Williams & Humbert prevailed in both the English and Jersey courts. In the English action, the court set aside the Master Agreement by which Williams & Humbert ostensibly had conveyed the trademarks and entered judgment and injunction against W & H and the family with respect to worldwide rights to the trademarks. The decision ultimately was sustained in the House of Lords. In the Jersey action, the court decreed that all shares of W & H were held on trust for Williams & Humbert.

The family moved on October 27, 1986 to intervene as defendants in the present action and to vacate the stay of proceedings because W & H, now effectively controlled by plaintiff under the Jersey decree, no longer could be relied upon to litigate in the family's interest. (Counsel for W & H below withdrew on January 19, 1987. It remains unrepresented.) The motion was accompanied by the family's proposed answer to Williams & Humbert's complaint and counterclaims seeking recognition of

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the family's claim to the United States trademarks, anti-infringement injunctive relief, and an accounting. Williams & Humbert did not respond directly to the family's application, but instead moved to stay all proceedings on that motion and then filed a motion for summary judgment, offering the English judgment as evidence that the action below was res judicata. Since the family had not been permitted to intervene and since the nominal defendant was now owned for the benefit of the plaintiff, no one filed opposition to the motion for summary judgment. The District Court denied the formally unopposed motion to intervene without stating a basis, allowed the formally unopposed motion for summary judgment, and denied the family's subsequent request that the...

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