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Sparrow Barns & Events, LLC v. The Ruth Farm Inc.

United States District Court, E.D. Texas, Sherman Division

April 10, 2019

SPARROW BARNS & EVENTS, LLC
v.
THE RUTH FARM INC.

          MEMORANDUM OPINION AND ORDER

          AMOS L. MAZZANT UNITED STATES DISTRICT JUDGE.

         Pending before the Court is Plaintiff Sparrow Barns & Events, LLC's (“Sparrow Barns”) Emergency Motion for Temporary Restraining Order and Preliminary Injunction (Dkt. #3). Having considered the motion and the relevant pleadings, the Court finds that the motion should be granted.

         BACKGROUND

         I. The White Sparrow

         Sparrow Barns is owned and operated by the Huerta and Ramos families. Nadia Ramos dreamed of a custom-designed barn that could be used as a wedding and events venue. Nadia Ramos and her mother, Wanna Huerta, began developing plans for a venue in 2012. After completing the plans, Nadia's father, John Huerta-a general contractor-constructed the venue in Quinlan, Texas sometime between 2012 and 2014. The family named the venue the White Sparrow. Sparrow Barns is the official owner of the White Sparrow.

         The White Sparrow is not simply a traditional barn used for weddings and events. Inside the White Sparrow is the Grand Hall. The Grant Hall is framed like a traditional barn but includes vaulted ceiling beams and wrapped vertical columns (Dkt. #3 at p. 10). Lighting the Grand Hall are “ornate, tiered candelabra chandeliers” and a “selective back wall window design.” (Dkt. #3 at p. 10). The walls of the Grand Hall are “rustically whitewashed” from floor to ceiling (Dkt. #3 at p. 10). Due to the unique aesthetic of the White Sparrow, Nadia Ramos and Wanna Huerta sought copyright registration for the White Sparrow (Dkt. #3 at p. 3). On August 15, 2015, the United States Copyright Office issued a Certificate of Registration for the White Sparrow as an architectural work (Dkt. #3-5).

         Since its opening in 2014, the White Sparrow gained a reputation in the wedding industry. Publications recognize the White Sparrow for its design, and the White Sparrow has been voted one of the best wedding venues in the United States (Dkt. #3 at p. 3). Additionally, couples travel from across the United States, and other parts of the world, to host their weddings in the White Sparrow while certain celebrities and large corporations use the White Sparrow for commercial photography shoots (Dkt. #3 at p. 1). As a result, Sparrow Barns accumulated significant business from the White Sparrow and gained substantial customer goodwill (Dkt. #3 at p. 3). But success often attracts imitation, and the success of the White Sparrow appears to have attracted the attention of another Texas family.

         II. The Nest

         Sparrow Barns alleges that on June 29, 2016, Courtney Wood contacted Sparrow Barns requesting a tour of the White Sparrow for her upcoming wedding (Dkt. #3 at p. 4). Sparrow Barns arranged for Courtney Wood and her parents, Christopher and Lawanna Thompson, to take a private, guided tour of the venue on July 14, 2016 (Dkt. #3 at p. 4). During the tour, Courtney Wood and her parents took multiple photographs and hand-written notes (Dkt. #3 at p. 4). Christopher Thompson also reportedly left the tour to view other areas of the venue before a Sparrow Barns manager asked him to rejoin the tour (Dkt. #3 at p. 4). A few months later, someone from the Thompson family contacted Sparrow Barns to ask about payment options and discounts (Dkt. #3 at p. 5).

         On February 19, 2017, Sparrow Barns held an open house for the public and interested vendors to view the White Sparrow (Dkt. #3 at p. 5). Christopher and Lawanna Thompson attended the open house (Dkt. #3 at p. 5). Learning that John Huerta was a general contractor, Christopher Thompson asked John Huerta detailed questions about the construction of the White Sparrow (Dkt. #3 at p. 5). Later, Nadia Ramos found Christopher Thompson in a closed-off area of the White Sparrow and asked him to leave (Dkt. #3 at p. 5).

         Sparrow Barns subsequently learned that Christopher and Lawanna Thompson were owners of Defendant the Ruth Farm Inc. (“Ruth Farm”) (Dkt. #3 at p. 4). In 2017, Ruth Farm began constructing another avian-themed wedding and events barn in Ponder, Texas-about ninety miles northwest of the White Sparrow (Dkt. #3 at p. 4). Ruth Farm called its venue the Nest (Dkt. #3 at p. 4). Sparrow Barns provides a picture-to-picture comparison of the White Sparrow and the Nest:

         (Image Omitted)

         (Dkt. #1-2; Dkt. #1-4; Dkt. #3 at pp. 14-15).

         III. Notice

         As Ruth Farm planned and constructed the Nest, it released concept photographs of the venue (Dkt. #3 at p. 6). After the release of the photographs, Sparrow Barns received questions from customers and vendors asking whether it was the owner of the Nest or whether it granted permission for Ruth Farm to build the Nest (Dkt. #3 at p. 6).

         Anthony Ramos-a Sparrow Barns manager-called the Nest to inform its owners that the White Sparrow was protected by copyright and trade dress law (Dkt. #3-3). Whitney Wood, another daughter of Christopher and Lawanna Thompson, answered the call. Whitney Wood explained to Anthony Ramos that she knew of the White Sparrow but did not know it was protected by law (Dkt. #3-3 ¶ 11). Whitney Wood also explained that the Thompsons “tried to make changes” to their venue before construction, but would talk to the builder again (Dkt. #3-3 at ¶¶ 11-12).[1]

         Days later, Christopher Thompson called Anthony Ramos. Christopher Thompson told Anthony Ramos never to call and threaten his daughter again (Dkt. #3-3 ¶¶ 13-17). Anthony Ramos explained that he did not threaten Whitney Woody, but called to inform her of the intellectual property violations (Dkt. #3-3 ¶¶ 13-17). Christopher Thompson then called Anthony Ramos “dumb” and stated, “you can't copyright a barn.” (Dkt. #3-3 ¶ 17). Anthony Ramos responded that you can copyright a barn and “we go after venues who try to copy us.” (Dkt. #3-3 ¶ 17). Christopher Thompson then threatened to drive to the White Sparrow and “kick [Anthony Ramos's] a[**].” (Dkt. #3-3 ¶ 18).

         IV. Legal Action

         Sparrow Barns indicates that after the construction of the Nest, customer confusion grew. Specifically, social media users began mistaking the White Sparrow for the Nest in their comments on and tags of the venues (Dkt. #3 at p. 7). Sparrow Barns also began receiving inquiries from vendors who confused the venues (Dkt. #3 at p. 7).

         On June 28, 2017, Sparrow Barns sent a cease-and-desist letter to Ruth Farm urging Ruth Farm to cease its copyright and trade dress infringement (Dkt. #3 at p. 7). Ruth Farm responded denying any infringement (Dkt. #3 at p. 7). Sparrow Barns replied outlining specific acts of infringement (Dkt. #3 at p. 8). Ruth Farm did not respond to Sparrow Barns' second letter.

         After receiving no response to its second letter, Sparrow Barns filed suit against Ruth Farm in this Court on August 10, 2016 (the “First Suit”). Sparrow Barns & Events LLC v. Ruth Farm Inc., 4:17-CV-558-KPJ. On April 17, 2018, the parties mediated the case and reached a compromise (Dkt. #3 at p. 8). In the following Settlement Agreement, Ruth Farm agreed to make certain changes to the Nest by January 1, 2019, and to notify Sparrow Barns within seven days of completing the changes (Dkt. #3 at p. 8; Dkt. #7). Sparrow Barns agreed to release its claims after confirming Ruth Farm completed the changes (Dkt. #3 at p. 8; Dkt. #7).

         V. Back to Court

         Sparrow Barns filed this suit against Ruth Farm on January 30, 2019 (“Second Suit”) (Dkt. #1). Sparrow Barns alleges that Ruth Farm did not comply with the Settlement Agreement. Sparrow Barns reasserts its claims from the First Suit along with a breach of contract claim. Ruth Farm filed an answer to the Second Suit on March 29, 2019 (Dkt. #15).

         Before Ruth Farm filed its answer, Sparrow Barns filed the motion at issue on February 18, 2019 (Dkt. #3). Sparrow Barns requests the Court enjoin Ruth Farm from:

(a) . . . from selling, offering for sale, distributing or advertising in commerce its services displaying the trade dress owned by [Sparrow Barns] and (b) must remove from commerce any advertisement or offer to sale in commerce its services displaying the trade dress owned by [Sparrow Barns] on its website, social media, and accounts with third parties.

(Dkt. #3-19).

         The Court set a hearing on the motion for March 1, 2019, and ordered Sparrow Barns to serve the order setting the hearing on Ruth Farm (Dkt. #6). The Court then reset the hearing for March 11, 2019 (Dkt. #9). Despite service and the resetting, Ruth Farm filed a response to the motion only seventeen minutes before the hearing (Dkt. #11). At the hearing, the Court allowed both parties to argue the motion and present evidence (Dkt. #12). The Court then provided Sparrow Barns a week to file a reply to the motion and denied Ruth Farm's request to amend its response (Dkt. #12). Sparrow Barns filed its reply on March 15, 2019 (Dkt. #13).

         LEGAL STANDARD

         When an opposing party receives adequate notice of, and an opportunity to be heard on, a motion for a temporary restraining order, the procedure that follows does not functionally differ from that of an application for a preliminary injunction. See Harris Cty., Tex. v. CarMax Auto Superstores Inc., 177 F.3d 306, 326 (5th Cir. 1999); Dilworth v. Riner, 343 F.2d 226, 229 (5th Cir. 1965) (citation omitted); Empower Texans, Inc. v. Nodolf, 306 F.Supp.3d 961, 965 (W.D. Tex. 2018) (citing Dilworth, 343 F.2d at 229); Jaroy Constr., Inc. v. La. State Licensing Bd. for Contractors, CIV.A. 10-958, 2010 WL 1254717, at *1 (E.D. La. Mar. 24, 2010) (citation omitted). A party seeking a preliminary injunction must establish the following elements: (1) a substantial likelihood of success on the merits; (2) a substantial threat that plaintiffs will suffer irreparable harm if the injunction is not granted; (3) that the threatened injury outweighs any damage that the injunction might cause the defendant; and (4) that the injunction will not disserve the public interest. Nichols v. Alcatel USA, Inc., 532 F.3d 364, 372 (5th Cir. 2008). “A preliminary injunction is an extraordinary remedy and should only be granted if the plaintiffs have clearly carried the burden of persuasion on all four requirements.” Id. Nevertheless, a movant “is not required to prove its case in full at a preliminary injunction hearing.” Fed. Sav. & Loan Ins. Corp. v. Dixon, 835 F.2d 554, 558 (5th Cir. 1985) (quoting Univ. of Tex. v. Comenisch, 451 U.S. 390, 395 (1981)). The decision whether to grant a preliminary injunction lies within the sound discretion of the district court. Weinberger v. Romero-Barcelo, 456 U.S. 305, 320 (1982).

         ANALYSIS

         The Court ordered Sparrow Barns to serve its order setting the hearing on Ruth Farm (Dkt. #6). Ruth Farm filed a response to Sparrow Barns' motion and Counsel for Ruth Farm appeared at the March 11 hearing to argue against the motion and present evidence (Dkt. #11; Dkt. #12). As Ruth Farm received notice of, and a fair opportunity to be heard on, the motion, the Court treats the motion as a motion seeking a preliminary injunction. See CarMax Auto Superstores Inc., 177 ...


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