UIU accuses UIU (MA), UIU Massachusetts, and two individual officers of the defendant corporations of trademark infringement, fraud, unjust enrichment, slander of business title and tortious interference in connection with the formation of a rival nonprofit corporation, and sought a preliminary injunction. The controversy resulted from the election and subsequent removal of Massachusetts resident Ide-Okoye, which led to a split among the governing members of UIU into two factions. UIU asserts that it is the proper entity and owner of rights in the UIU name, while the defendants assert that Ide-Okoye was never formally removed, remains president of UIU, and properly reincorporated the entity in Massachusetts. Judge Gorton granted UIU’s motion for a preliminary injunction in part. He noted that the likelihood of success on the merits was the most important consideration, because the other factors (potential for irreparable harm absent the injunction, balance of the hardships, and effect on the public interest) favor the protection of trademark rights as a matter of public policy. He determined that, although each party’s claim to rights in the mark were muddled and convoluted, UIU was likely to prevail as the owner of the mark. UIU was incorporated in Nebraska in 2009 and, while defendants claim that they dissolved the corporation and reformed it in Massachusetts, the Nebraska corporation was never dissolved and remains active in Nebraska. Further, one of the current officers of the Nebraska entity was listed as the principal offer on the 501(c) filing in 2009 to obtain tax-exempt status. This contrasts with the defendant corporations, which were organized much later and which have no current officers listed on their recent tax-exempt filings. As this suggests that plaintiff UIU is the rightful owner of the mark, Judge Gorton granted a preliminary injunction to the extent it seeks to prevent the defendants from using the corporate name until such time the membership of the organization endorses one or the other faction. He further ordered the parties to call an emergency meeting of the UIU members to vote on the election of officers to determine which faction would be in control of the organization, prepare and adopt new, comprehensible by-laws, and dissolve whichever corporate faction does not prevail. He indicated that he would appoint a special master to oversee such activity.
Judge Gorton denied the defendants’ motion to dismiss the complaint for failure to join a necessary and indispensable party under Rule 19. Defendants sought to join a number of officers of UIU, finding that the individual officers of the plaintiff were not necessary for the resolution of the case, which involves the use of the trademark. He also rejected their res judicata arguments, finding that previous cases involved activity that occurred prior to the formation of the Massachusetts corporations and/or did not involve decisions relating to the rightful owner of the mark.
One would think that the time, effort and money spent on this litigation, which Judge Gorton characterizes as an “internal, self-destructive feud,” would be better spent on the people of Umuoji region of Nigeria, the purported purpose of each of the non-profit corporations.