Umuoji Improvement Union (North America), Inc. v. Umuoji Improvement Union (North America), Inc.

• Decision Date: 04 May 2021
• Docket Number: Civil Action No. 20-12229-NMG
• Citation: 537 F.Supp.3d 79
• Parties: UMUOJI IMPROVEMENT UNION (NORTH AMERICA), INC., Plaintiff, v. UMUOJI IMPROVEMENT UNION (NORTH AMERICA), INC., et al., Defendants.
• Court: U.S. District Court — District of Massachusetts

537 F.Supp.3d 79

UMUOJI IMPROVEMENT UNION (NORTH AMERICA), INC., Plaintiff,

v.UMUOJI IMPROVEMENT UNION (NORTH AMERICA), INC., et al., Defendants.

Civil Action No. 20-12229-NMG

United States District Court, D. Massachusetts.

Signed May 4, 2021

Travis Pregent, Pregent Law, Boston, MA, for Plaintiff.

Godson A. Anosike, Law Office of Godson A. Anosike, Brockton, MA, Ogor Winnie Okoye, Bos Legal, LLC, Lynn, MA, for Defendants.

MEMORANDUM & ORDER

GORTON, United States District Judge

Plaintiff Umuoji Improvement Union (North America), Inc. ("Umuoji I" or "plaintiff") brings suit against Umuoji Improvement Union (North America), Inc. ("Umuoji II"), Umuoji Improvement Union, Massachusetts, Inc. ("Umuoji, MA"), Victor Ide-Okoye ("Ide-Okoye") and Ogor Winnie Okoye ("Okoye") (collectively "defendants").

Umuoji I alleges that Umuoji II unlawfully used its name and services as a means of tarnishing its reputation, diluting the quality of its name and lessening the capacity of the name to identify and distinguish its services. Plaintiff asserts that such conduct violates section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a) ("Lanham Act") (Count I) and Massachusetts General Laws c. 110h § 12 ("Chapter 110h") (Count II) and constitutes fraud (Count III), unjust enrichment (Count IV), slander of business title (Count V) and tortious interference with contract (Count VI).

Pending before the Court are Umuoji I's motion for a preliminary injunction and Umuoji II's motions to dismiss and for a hearing. For the reasons that follow, plaintiff's motion will be allowed, in part, and denied, in part, and defendants’ motions will be denied.

I. Background

In 2009, Umuoji Improvement Union (North America), Inc. ("UIU") filed articles of incorporation in Nebraska as a non-profit organization and has, since, received tax-exempt status pursuant to § 501(c)(3) of the Internal Revenue Code. The organization has the charitable purpose of raising funds to benefit the people of Umuoji, Nigeria and is comprised of members of Umuoji descent.

In July, 2017, UIU elected Ide-Okoye, a Massachusetts resident, as president of the organization but, according to plaintiff, removed him in November, 2018, due to purported impropriety. That alleged removal caused the governance of UIU to split into two competing "factions". Plaintiff asserts that its faction represents the original UIU which was organized in and has operated under the laws of the State of Nebraska since 2009 with its principal place of business in that state.

Plaintiff alleges that, in 2019, the competing faction (led by Ide-Okoye) improperly filed articles of organization for Umuoji II in Massachusetts as a "counterfeit" non-profit corporation, although UIU's status remains active in Nebraska. Currently, Ide-Okoye is the president of Umuoji II and the director of Umuoji, MA, a purported subsidiary of the "counterfeit" Massachusetts corporation. He is married to defendant Okoye, who likewise is a Massachusetts resident, a founding officer of Umuoji, MA and an attorney of record for all defendants.

Defendants, on the other hand, contend that Umuoji II is the original UIU and that defendants are the true owners of the disputed trademark and trade name. They explain that Ide-Okoye was never formally removed as president of UIU and, thus, remains the duly elected president of the 501(c)(3) organization. Defendants add that, in 2019, President Ide-Okoye removed the domicile of UIU from Nebraska to Massachusetts with the authorization of UIU members and that the non-profit organization no longer has any presence in Nebraska.

The official records of the Secretaries of State of both states list "Umuoji Improvement Union (North America), Inc." as active, domestic non-profit organizations. Umuoji I declares that Umuoji II is the counterfeit organization while defendants assert the opposite. Both parties have proffered various documents in support of their conflicting contentions (including three different but equally incomprehensible sets of by-laws) and accuse each other of having presented fraudulent documentation.

II. Plaintiff's Motion for a Preliminary Injunction

Plaintiff moves for a preliminary injunction 1) to prevent defendants from using the name, Umuoji Improvement Union (North America), Inc., and from acting as its agents and 2) to direct defendants to account to plaintiff for all sums of money, profits and gains which defendants have earned for their own account since September, 2017, the date on which Umuoji II was organized in the Commonwealth of Massachusetts. Plaintiff submits that the essence of this case is not whether Mr. Ide-Okoye was removed as President of the organization but, rather, whether he unlawfully organized counterfeit organizations under the same name in Massachusetts in order to compete with Umuoji I.

Defendants respond that plaintiff's motion is without merit because plaintiff has failed to prove either that it owns a trademark in the name "Umuoji Improvement Union (North America), Inc." or that Ide-Okoye was formally removed as the President of Umuoji I. Defendants contend that, in any event, plaintiff's true motive is not to claim ownership of the trade name but, instead, to obtain control over $50,000 which has been raised by Umuoji II to build a medical center in Umuoji, Nigeria. Finally, defendants aver that the equities are in their favor because it is their "faction" of UIU which has most recently performed charitable work, namely, completing the construction of the subject medical center.

Oral argument was heard on the pending motions on February 26, 2021, which brought little clarity to this internal, self-destructive feud.

A. Legal Standard

In order to obtain a preliminary injunction, the moving party must establish 1) a reasonable likelihood of success on the merits, 2) the potential for irreparable harm if the injunction is withheld, 3) a favorable balance of hardships and 4) the effect on the public interest. Jean v. Mass. State Police, 492 F.3d 24, 26-27 (1st Cir. 2007). Out of these factors, the likelihood of success on the merits "normally weighs heaviest in the decisional scales." Coquico, Inc. v. Rodriguez-Miranda, 562 F.3d 62, 66 (1st Cir. 2009).

The Court may accept as true "well-pleaded allegations [in the complaint] and uncontroverted affidavits." Rohm & Haas Elec. Materials, LLC v. Elec. Circuits, 759 F. Supp. 2d 110, 114, n.2 (D. Mass. 2010) (quoting Elrod v. Burns, 427 U.S. 347, 350, n.1, 96 S.Ct. 2673, 49 L.Ed.2d 547 (1976) ). The Court may also rely on otherwise inadmissible evidence, including hearsay, in deciding a motion for preliminary injunction. See Asseo v. Pan American Grain Co., Inc., 805 F.2d 23, 26 (1st Cir. 1986).

Ultimately, however, the issuance of preliminary injunctive relief is "an extraordinary and drastic remedy that is never awarded as of right." Peoples Fed. Sav. Bank v. People's United Bank, 672 F.3d 1, 8-9 (1st Cir. 2012) (quoting Voice of the Arab World, Inc. v. MDTV Med. News Now, Inc., 645 F.3d 26, 32 (1st Cir. 2011) ). It should issue "only where the intervention of a court of equity is essential in order effectually to protect property rights against injuries otherwise irremediable." Weinberger v. Romero-Barcelo, 456 U.S. 305, 312, 102 S.Ct. 1798, 72 L.Ed.2d 91 (1982) (citation and internal quotations omitted).

B. Application

Although likelihood of success on the merits inquiry is only the first of four factors, it is by far the most significant. Weaver v. Henderson, 984 F.2d 11, 12 (1st Cir. 1993) ("[W]hether the plaintiffs are likely to succeed on the merits" is the "sine qua non" of the test for a preliminary injunction."). That is especially true in a trademark case because the resolution of the other three factors will depend, in large part, on whether plaintiff is likely to succeed in establishing infringement. Borinquen Biscuit Corp. v. M.V. Trading Corp., 443 F.3d 112, 115 (1st Cir. 2006). This focus on likelihood of success is consistent with the idea that, "as a matter of public policy, trademarks should be protected against infringing use." Id.

i. Trademark Infringement and False Designation of Origin

To prevail on a claim under the Lanham Act based on "false designation of origin," 15 U.S.C. § 1125(a)(1)(A), plaintiff must prove

1) the ownership of a distinctive mark entitled to trademark protection, 2) the use of that name in interstate commerce, and 3) its use by another in a manner likely to cause confusion as to the origin of the source of the goods or services.

Nat'l Nonwovens, Inc. v. Consumer Products Enterprises, Inc., 397 F. Supp. 2d 245, 257 (D. Mass. 2005). Nearly identical standards apply to trademark infringement claims brought under Mass. Gen. Laws ch. 110H, § 12. See Boston Granite Exchange, Inc. v. Greater Boston Granite, LLC, No. 11-cv-11898, 2012 WL 3776449, at *5 (D. Mass. Aug. 29, 2012).

In this case, the over-riding issue is which party owns and has rights in the name, "Umuoji Improvement Union (North America), Inc.".¹ Both parties claim to be the rightful owner of the mark and proffer convoluted evidence in support thereof. Having considered the written and oral submissions of the parties, this Court concludes that, although the facts remain muddled, there is a greater likelihood that plaintiff is the original UIU and, thus, the owner of the subject mark.

It is undisputed that UIU was organized in Nebraska in 2009 and has, since, obtained tax-exempt status pursuant to § 501(c)(3) of the Internal Revenue Code. Although defendants contend that UIU subsequently changed its domicile to Massachusetts in 2019 (creating Umuoji II) and removed its presence from Nebraska, plaintiff has shown that Umuoji I remains "active" in Nebraska, has not been dissolved and is current in its Nebraska filings.

Furthermore, the person currently registered as the Treasurer of Umuoji I, Cletus Ezeji, is also registered as the principal officer on the § 501(c)(3) filing with the Internal Revenue Service ("IRS"). In...