Tesoro Corporation v. Tesoro Corporation, D/B/A Tesoro Petroleum Corp.

• Court: Court of Appeals of Texas
• Decided: February 3, 2015
• Docket: 13-14-00511-CV
• Status: Published

Opinion

ACCEPTED 13-14-00511-cv THIRTEENTH COURT OF APPEALS CORPUS CHRISTI, TEXAS 2/3/2015 11:05:49 AM DORIAN RAMIREZ CLERK

No. 13-14-00511-CV

In the Court of Appeals FILED IN 13th COURT OF APPEALS For the Thirteenth Judicial District CORPUS CHRISTI/EDINBURG, TEXAS Corpus Christi-Edinburg, Texas 2/3/2015 11:05:49 AM TESORO CORPORATION DORIAN E. RAMIREZ Appellant Clerk

V.

TESORO CORPORATION D/B/A TESORO PETROLEUM CORP. Appellee

On Appeal from the 206TH District Court, Hidalgo County, Texas, Trial Court Cause No. C-2971-09-D

APPELLANT’S BRIEF

Mark A. Weitz Reynaldo Ortiz Weitz Morgan PLLC Law Office of Rey Ortiz 100 Congress Avenue 1305 E. Nolana, Suite 2000 Suite F Austin, Texas 78701 McAllen, Texas 78504 512-394-8950 956-687-4567 512-657-1849 (mobile) 956-631-1384 (facsimile) 512-852-4446 (facsimile)

ORAL ARGUMENT REQUESTED IDENTITY OF PARTIES AND COUNSEL

Appellant certifies that the following is a

complete list of the parties, attorneys, and other

persons who have an interest, financial or otherwise,

in the outcome of this proceeding:

Appellant:

TESORO CORPORATION

Appellant’s: Counsel:

Mark A. Weitz Reynaldo Ortiz Weitz Morgan PLLC Law Office of Rey Ortiz 100 Congress Avenue 1305 E. Nolana, Suite 2000 Suite F Austin, Texas 78701 McAllen, Texas 78504 512-394-8950 956-687-4567 512-657-1849 (mobile) 956-631-1384 (facsimile) 512-852-4446 (facsimile)

Appellee:

TESORO CORPORATION D/B/A TESORO PETROLEUM CORPORATION

Appellee’s Counsel:

Frank Weathered Sarah Pierce Cowen Dunn, Weathered, Coffey, Cowen & Garza, L.L.P. Rivera & Kasperitis, P.C. 820 Hackberry Avenue, 611 S. Upper Broadway Suite 101 Corpus Christi, Texas 78401 McAllen, Texas 78501 361-883-1594 956-994-9170 361-883-1599 (facsimile) Gerald T. Drought, Esq. Gilbert Hinojosa Martin & Drought, P.C. Gilbert Hinojosa & Bank of America Plaza, Associates, PC 25th Floor 622 East St. Charles St. 300 Convent Street Brownsville, Texas 78520 San Antonio, Texas 78205 956-544-4218 210-227-7591 956-544-4218 (facsimile) 210-227-7924 (facsimile) TABLE OF CONTENTS

Page

Table of Contents i

Table of Authorities v

Statement of the Case 1

Statement Regarding Oral Argument 3

Issues Presented: 4

Issue #1: Did the District Court err in Granting the Appellee’s Motion to Set Aside the Jury Verdict based upon failure to Establish Irreparable harm and Lack of Adequate Remedy at Law?

Issue #2: Did the District Court err in Granting the Appellee’s Motion to Set Aside the Jury Verdict based on Improper Jury Instructions.

Issue #3: Even if the Court Rejected the Appellee’s Motion to Set Aside Jury Verdict Did the District Court err in Denying Appellant’s Request for Permanent Injunction after the Full Hearing.

Issue#4: Did the District Court err in denying Appellant’s Injunctive Relief based on Balancing the Equities and/or Unclean Hands.

Issue #5: Did the District Court err in vacating the Jury’s Attorney Fee award.

i Page

Statement of Facts 5

Summary of Argument 10

Argument 10

Issue #1: Did the District Court err in Granting the Appellee’s Motion to Set Aside the Jury Verdict based upon failure to Establish Irreparable harm and Lack of Adequate Remedy at Law? 11

A. The Issue of Irreparable Harm is for the Court: 11

B. There Was Irreparable Harm: 15

C. There is no Adequate Remedy at Law: 17

Issue #2: Did the District Court err in Granting the Appellee’s Motion to Set Aside the Jury Verdict based on Improper Jury Instructions. 19

Issue #3: Even if the Court Rejected the Appellee’s Motion to Set Aside Jury Verdict Did the District Court err in Denying Appellant’s Request for Permanent Injunction after the Full Hearing. 28

A. Standard of Review: 29

B. Imminent Harm: 29

C. Irreparable Injury and Adequate Remedy at Law: 32

ii Page

1. Irreparable Injury: 33

2. Adequate Remedy at Law: 34

D. The Record Shows a Complete Absence of any Guiding Principles or Rules Upon Which the Court Relied in Denying Injunctive Relief. 38

1. Requested Scope: 38

(i) State Wide Prohibition of Use: 38

(ii) Presumption of State-Wide Rights: 39

(iii)Actual Use and Business Transactions: 41

(iv) All Speech Mediums: 43

(v) Publicly Traded Stock Designation: 46

(vi)Use of Appellant’s Trade Name on the Internet: 46

2. In Light of the Appellant’s Evidence and the Virtual Absence of Appellee’s Evidence to the Contrary the Court Denied Appellant’s Injunctive Relief without Any Basis in Guiding Principles or Rules: 49

iii Page

Issue#4: Did the District Court err in denying Appellant’s Injunctive Relief based on Balancing the Equities and/or Unclean Hands. 51

A. Balancing the Equities: 51

B. Overly Broad: 56

C. Unclean Hands: 59

Issue #5: Did the District Court err in vacating the Jury’s Attorney Fee award. 62

Conclusion 63

Prayer 65

Certificate of Service 66

Certificate of Brief 67

Appendices

Appendix 1: Copy of the Trial Court’s Judgment

Appendix 2: Copy of Jury Charge

Appendix 3: Record Excerpts of Court’s Directed Verdict

iv TABLE OF AUTHORITIES

Cases:

2300, Inc. v. City of Arlington, 888 S.W.2d 123 (Tex. App.--Fort Worth 1994, no writ) 25,29

Abercrombie and Fitch Co. v. Hunting World, Inc., 537 F.2d 4 (2nd Cir. 1976) 12

All Am. Builders, Inc. v. All Am. Siding of Dallas, Inc., 991 S.W.2d 484, (Tex. App.-Fort Worth 1999, no pet.) 24

Bd. of Trustees v. Fox, 492 U.S. 469, 109 S.Ct. 3028, 106 L.Ed.2d 388 (1989) 44

Black Hills Jewelry Mfg. Co. v. Gold Rush, Inc., 633 F.2d 746 (8th Cir.1980) 17,26,33

Brennan's, Inc. v. Brennan's Rest., L.L.C., 360 F.3d 125 (2d Cir.2004) 17,26,33

Camarena v. Texas Employment Comm’n, 754 S.W. 2d 149, 151 (Tex. 1988) 30

Cameron County v. Velasquez, 668 S.W.2d 776 (Tex.App.--Corpus Christi 1984, writ ref'd n.r.e.) 23

Cano v. Macarena, 606 S.W.2d 718 (Tex. App.- Corpus Christi, 1980) 40

Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S. 557, 100 S. Ct. 2343, 65 L.Ed.2d 341 (1980) 44-45

v Page Chemlawn Servs. Corp. v. GNC Pumps, Inc., 690 F. Supp. 1560 (S.D.Tex.1988) 30,34

Circuit City Stores, Inc. v. CarMax, Inc., 165 F.3d 1047 (6th Cir.1999) 17,26,34

Craddock v. Sunshine Bus Lines, 134 Tex. 388, 133 S.W.2d 124, 126 (Tex.Comm.App.--1939, opinion adopted) 49

Davis v. Huey, 571 S.W.2d 859 (Tex. 1978) 29,49

Douglas v. Walker, 707 S.W.2d 733, 734 (Tex. App.--Beaumont 1986, no writ) 14

Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238 (Tex.1985), cert. denied, 476 U.S. 1159, 106 S. Ct. 2279, 90 L.Ed.2d 721 (1986) 25,29

Dunnagan v. Watson, 204 S.W.3d 30 (Tex. App.—Fort Worth 2006, pet. denied) 59

Enter. Int'l, Inc. v. Corporacion Estatal Petrolera Ecuatoriana, 762 F.2d 464 (5th Cir.1985) 32

Flores v. Flores, 116 S.W.3d 870 (Tex. App.— Corpus Christi 2003, no pet.) 59

Florida Bar v. Went For It, 515 U.S. 618, 115 S. Ct. 2371, 132 L.Ed.2d 541 (1995) 45

Fuji Photo Film Co. v. Shinohara Shoji Kabushiki Kaisha, 754 F.2d 591 (5th Cir.1985) 16

Gonzalez v. Zamora, 791 S.W.2d 258 (Tex. App. -Corpus Christi, 1990) 58

vi Page

GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199 (9th Cir. 2000) 17,26,34

Hellenic Inv. v. Kroger Co., 766 S.W.2d 861 (Tex. App.-Houston [1st Dist.] 1989, no writ) 57

Hitt v. Mabry, 687 S.W.2d 791, 795 (Tex. App.- San Antonio 1985, no writ) 56

Hudgens v. Goen 673 S.W. 2d 420 (Tex. App- Waco, 1979) 22

Isunai v. Manske-Sheffield Radiology Group, 805 S.W. 2d 602 (Tex. App—Beaumont, 1991) 58

Jeter v. Associated Rack Corp., 607 S.W.2d 272 (Tex. App.—Texarkana 1980, ref. n.r.e.) 18,35

Jim Rutherford Investments Inc. v. Terramar Beach Community Ass'n., 25 S.W.3d 845(Tex. App. —Houston [14 Dist.] 2000, pet. den’d) 28

Joy Mfg. Co. v. CGM Valve & Gauge Co., 730 F. Supp. 1387 (S.D.Tex.1989)

Landry v. Travelers Insurance Co., 458 S.W. 2d 649 (Tex. 1970) 49

Lazy M Ranch, Ltd. v. TXI Operations, LP, 978 S.W.2d 678 (Tex. App.-Austin 1998, pet. denied) 59-60

Light v. Centel Cellular Co, 883 S.W.2d 642 (Tex. 1994) 58

Lower Nueces River Water Supply Dist. v. Live Oak County, 312 S.W.2d 696, 701 (Tex. Civ. App.-San Antonio 1958, writ ref'd n.r.e.) 56

vii Page

McAfee MX v. Foster, No. 02-07-080-CV, 2008 WL 344575, at *2, 2008 Tex.App. LEXIS 968, at *8 (Tex.App.-Fort Worth Feb. 7, 2008, pet. denied), petition for cert. filed, No. 08-639 (U.S. Nov. 12, 2008) 52

McAx Sign Co., Inc. v. Royal Coach, Inc., 547 S.W.2d 368, 369 (Tex.Civ.App.--Dallas 1977, no writ) 1

McDonald's Corp. v. Robertson, 147 F.3d 1301, (11th Cir.1998) 17,26,34

Miller v. Lone Star Tavern, Inc. 593 S.W.2d 341 (Tex. Civ. App.--Waco 1979, no writ) 22

Ohralik v. Ohio State Bar Ass'n, 436 U.S. 447, 98 S.Ct. 1912, 56 L.Ed.2d 444 (1978) 44

Pappan Enters., Inc. v. Hardee's Food Sys., Inc., 143 F.3d 800, 805 (3d Cir.1998) 17,26,34

Parkem Indus. Servs., Inc. v. Garton 619 S.W. 2d 428 (Tex. Civ. App.—Amarillo 1981, no writ) 29

Pebble Beach Co v.Tour 18 I Ltd., 942 F. Supp. 1513 (S.D. Tex., 1996) 12

Pebble Beach Co. v. Tour 18 I, Ltd., 155 F.3d 526 (5th Cir. 1998) 13

Physicians and Surgeons Gen. Hosp. v. Koblizek 752 S.W. 2d 657 (Tex. App.—Corpus Christ, 1988) 23-24

viii Page

Pittsburgh Press Co. v. Pittsburgh Comm'n on Human Relations, 413 U.S. 376, 385, 93 S. Ct. 2553, 37 L.Ed.2d 669 (1973) 44

Pro Hardware, Inc. v. Home Ctrs. of America, Inc., 607 F.Supp. 146, 154 (S.D.Tex.1984) 30,34

Quantum Fitness Corp. v. Quantum Lifestyle Ctrs., L.L.C., 83 F.Supp.2d 810, 831 (S.D.Tex.1999) 27,33

Recon Exploration, Inc. v. Hodges, 798 S.W.2d 848 (Tex. App.--Dallas 1990, no writ) 29,49

Rescuecom Corp. v. Google, Inc. 562 F.3d 123 (2d Cir. 2009) 48

S. Monorail Co. v. Robbins & Myers, Inc., 666 F.2d 185, 188 (5th Cir. Unit B 1982) 27,33

Smithson v. Cessna Aircraft Co., 665 S.W.2d 439 (Tex.1984) 49

Societe Des Produits Nestle, S.A. v. Casa Helvetia, Inc., 982 F.2d 633, 640 (1st Cir.1992) 17

Soweco v. Shell Oil Co., 617 F.2d 1178, (5th Cir.1980), cert. denied, 450 U.S. 981, 101 S. Ct. 1516, 67 L.Ed.2d 816 19

Storey v. Cent. Hide & Rendering Co., 148 Tex. 509 226 S.W.2d 615, 618-19 (1950) 51-52

Texas Soc. v. Ft. Bend Chapter, 590 S.W.2d 156 (Civ. App.—Texarkana 1980, ref. n.r.e.) 18,35

Thompson v. W. States Med. Ctr., 535 U.S. 357, 122 S. Ct. 1497, 152 L.Ed.2d 563 (2002) 45

ix Page

Thompson v. Thompson Air Conditioning & Heating, Inc., 884 S.W.2d 555, (Tex. App.-Texarkana 1994, no pet.) 24

Ty, Inc. v. Jones Group, Inc., 237 F.3d 891 (7th Cir.2001) 17,26,33

Union Gas Corp. V. Gisler, 129 S.W. 3d 245 (Tex. App.-Corpus Christi, 2003) 60-61

Union Nat’l Bank v. Union Nat’l Bank, 909 F. 2d 839 (5th Cir. 1990) 12

Webb v. Glenbrook Owners Association, Inc., 98 S.W.3d 374, 384 (Tex. App.—Dallas, 2009) 57

Zapata v. Zapata 841 S.W. 2d 45 (Tex. App.— Houston [14th Dist], 1992) 1-12,16, 19,31

Statutes:

Tex. Bus. & Comm. Code § 16.15(c) (1968) 40

Tex. Bus. & Comm. Code s 16.27(a) (1968) 40

x STATEMENT OF THE CASE

This is an appeal of an adverse ruling by the

District Judge following a favorable jury verdict on

the issue of common law trade name infringement.

[Appendix 1]. Because the Order/Judgment is vague as

to the basis of the Court’s ruling, Appellant must

address all conceivable basis for the District Court’s

decision McAx Sign Co., Inc. v. Royal Coach, Inc., 547

S.W.2d 368, 369 (Tex.Civ.App.--Dallas 1977, no writ).

It is the Appellant’s contention that to the extent

the Court’s decision was based upon the Appellee’s

Motion to Set Aside the Jury Verdict [Clerk’s Record,

pp.143-156] 1 the Court erred in so doing. The Court had

directed a verdict that Appellant was the senior user 2 [Reporter’s Record: Volume V: 150-151] and the jury

found that Tesoro Corporation was both the Appellant’s

trade name and that the Appellee had created likelihood

of confusion [RR:XI:75]. To the Extent the Court’s

decision was based upon the Appellee’s Motion to set

1 There is only one volume of the Clerk’s record. Hereinafter CR: page. 2 Hereinafter, RR:Vol: Page.

1 aside based on improper jury issues [CR:143-156] the

Court again erred because the only two issues

presented, violation of the common law trade

infringement and declaratory relief were in fact one in

the same, in other words they necessarily related, and

the Appellee was on full notice as to what was being

pled and requested. To the extent the Court left the

jury verdict intact, but based its ruling on a lack of

irreparable injury or the presence of discernable

damages at law the Court again erred. Appellant put on

more than sufficient evidence both at trial and in the

Permanent Injunction hearing to show non-speculative,

unquantifiable injury that cannot be adequately

compensated at law. To the extent the Court denied

Appellant’s injunctive relief based upon the

application of unclean hands or a balancing of the

equities Appellant contends the Appellee was the only

party which appeared in court with unclean hands and

that over the course of the trial it gave the Trial

Court no equities on its behalf in which to balance

against Appellant’s needs. Finally, to the degree that

2 the Court did base its ruling on Appellant’s failure to

demonstrate its right to injunctive relief, the denial

of attorney’s fees stipulated to by both parties was

based upon the successful jury finding and should not

have been disturbed

STATEMENT REGARDING ORAL ARGUMENT

While the law on the issue of trade name and

trademark infringement is well developed, the facts of

this case present many issues the Court found novel, or

difficult to resolve. One of the specific aspects of

the case factually was the admission by the Appellee

that it knew the Appellant owned the name and after

being refused the use or the purchase of the name, it

proceeded to use the name anyway under the “assumed

name” provisions of Texas law. Furthermore, evidence at

trial revealed the Appellee knew there was the risk of

a trade name infringement claim [RR:V:41-44, 61-71;

IX:87]. At one point in the proceeding the court even

confronted the Appellee with the fact that Appellee’s

usurpation of the name may have been fraudulent

3 [RR:XI:61]. Appellant therefore contends that oral

argument is not only appropriate but necessary.

ISSUES PRESENTED

Issue #1

Did the District Court err in Granting the Appellee’s Motion to Set Aside the Jury Verdict based upon failure to Establish Irreparable Harm and Lack of Adequate Remedy at Law?

Issue #2

Did the District Court err in Granting the Appellee’s Motion to Set Aside the Jury Verdict based on Improper Jury Instructions.

Issue #3

Even if the Court Rejected the Appellee’s Motion to Set Aside Jury Verdict Did the District Court err in Denying Appellant’s Request for Permanent Injunction after the Full Hearing.

Issue#4

Did the District Court err in denying Appellant’s Injunctive Relief based on Balancing the Equities and Unclean Hands.

Issue #5

Did the District Court err in vacating the Jury’s Attorney Fee award.

4 STATEMENT OF FACTS

Appellant Tesoro Corporation is a Donna, Texas

sign leasing and sales business that has been in

existence since 1975. The owner of Tesoro Corporation,

Mr. Paul Sullivan secured the name Tesoro Corporation

in 1975 and has held it continuously every since that

time [RR:IV:43-45]. According to Appellee’s general

counsel, Charles Parrish, Appellee was formed as a

Delaware corporation in 1968 under the name Tesoro

Petroleum Corporation and in 1969 applied to do

business in Texas as Tesoro Petroleum Corporation

[RR:V:38]. Appellee has no business operations in Texas

aside from its corporate headquarters in San Antonio

where it has been since the inception of Appellee’s

existence [RR:IX:93]. Although Appellant does do

business as Triple A signs, its clients remit payment

and know his business as Tesoro Corporation, his

business operations and banking relationships are

conducted as Tesoro Corporation, and his tax returns

all reflect Tesoro Corporation [RR:IV:58-126].

Evidence at trial indicated Appellant did business

5 across Texas including Amarillo, Dallas, Houston, and

San Antonio, where Appellee is headquartered [RR:IV:48-

49,78; RR: VIII: 103-123, 214].

The evidence presented at trial shows that in 2004

Appellee approached Mr. Sullivan and one of his

employees and asked to either pay to use the name or to

purchase the name. Appellant’s agents clearly refused

both requests [RR:IV:192-200; RR:V:6-16] and the

evidence showed that Appellee nevertheless made a

corporate decision to proceed to use the Appellant’s

trade name [RR:V:61-71], enlisted the assistance of

Fulbright & Jaworski, and filed an assumed name

certificate with the Texas Secretary of State [RR:V:41-

44].

The attorney for Fulbright & Jaworski that

effectuated the name change and use of the name was

Carrie Platt/Ryan[RR:V:41-44]. Appellee actually

checked the availability of the name and found that

Appellant was the registered owner and the name was

therefore not available. The Texas statute in effect

in 2004 was the same as the statute today and

6 prohibited the use of identical or deceptively similar

names. That statute applied to the use of “Tesoro

Corporation” as an assumed name in Texas if it was

already taken, which in this case, it was, thus

prohibiting Appellee from using the name even as an

“assumed name” in Texas. [RR:V:61-71].

Appellee approached Appellant, through Carrie

Platt’s secretary, Darcy Angel and was unable to secure

the use or ownership of the name. Appellee was advised

by legal counsel of the legal ramifications of using

Tesoro Corporation as an assumed name and nevertheless

took the assumed name Tesoro Corporation knowing it

could be sued for trade name infringement and that

Appellant was the owner of that name [RR:V:61-71;

RR:IV:192-200; RR:V:6-16].

In 2004, shortly after Tesoro Petroleum changed its

name, Appellant began to get complaints that its

railroad cars were damaging property, that its trucks

were causing damage, and/or its employees were cutting

fence locks. Appellant had no railroad cars, tanker

trucks or the need to cut fences. The conduct,

7 railroad cars, trucks, and employees belonged to

Appellee, Tesoro Petroleum, which had now changed its

name to take Appellant’s name [RR:IV:127-129]. Then in

2009 Union Pacific Railroad, a potential customer of

both Appellant and Appellee, albeit for different

services, began making demands for money on Appellant.

What followed and continued through to the present were

demands for damages from other railroads, threats of

sanctions from Texas governmental agencies like the

insurance department and attorney general’s office, law

firms from as far away as Washington and Alaska sending

demand letters to Appellant for conduct and actions of

the Appellee and a continuous barrage of contact that

made it clear that Tesoro Petroleum’s name changed was

causing actual confusion within Texas and nationwide.

In addition, it became clear that potential lenders

were confusing Appellant’s credit with that of Appellee

and the good standing of Appellant with that of

Appellee. [RR:IV:129-192,204-207]. In 2010 a

consumer/client of Appellant counter sued Appellant in

Hidalgo County for conduct attributable to Appellee.

8 Richard Schell, the attorney who filed the complaint

for the Defendant, had done research on Tesoro

Corporation and due to the confusion created by

Appellee’s usurpation of Appellant’s name, had come to

believe that the Appellant was misrepresenting itself

and its identity [RR:IV:259-271].

During trial Appellant’s representatives testified

as to the irreparable harm caused by Appellee’s conduct

[RR:IV:127-128,129-192] although from the outset the

trial was bifurcated and the Court agreed to hear the

issues relevant to the permanent injunction only after

a jury verdict established liability and that any

judgment would be based upon the jury verdict and the

evidence adduced in the permanent injunction hearing

[RR: VIII: 59-62]. At the Permanent Injunction hearing

the Appellant’s President, Paul Sullivan, testified to

the on-going imminent harm caused by the confusion that

the jury in fact found existed [RR:VIII:70-103, 204-

207] and the fact that he could not calculate or

predict the extent and degree of the potential harm

[RR:VIII:91-93, 204-207]. Ironically, the Appellee’s

9 sole witness on the issue, Gene Trevino, admitted the

same thing both at trial and during the injunction

hearing [RR:VIII:235-236.RR:XI:26-30].

SUMMARY OF ARGUMENT

The District Court erred in granting the Appellee’s

Motion to Set Aside Jury Verdict. Having already

granted Plaintiff’s directed verdict on the issue of

senior user, the Jury properly found that Tesoro

Corporation was in fact Appellant’s trade name and that

the Appellee’s use of Appellant’s name created a

likelihood of confusion among consumers. The jury was

not required to find irreparable harm or adequate

remedy at law, as that was an issue for the court to

determine in the injunction phase of the case. The jury

issues as to trademark infringement and declaratory

relief were proper and more than adequately put

Appellee on notice as to the Appellant’s claims. With

only equitable relief requested the Appellant clearly

demonstrated both irreparable harm and the lack of any

relief at law. Thus there was no basis for the Court

10 to have nullified the award of attorney’s fees to the

Appellant.

ARGUMENT

Did the District Court err in Granting the Appellee’s Motion to Set Aside the Jury Verdict based upon failure to Establish Irreparable harm and Adequate Remedy at Law?

A. The Issue of Irreparable Harm is for the Court:

The first basis of Appellee’s Motion for Judgment

and to Disregard is the assertion that the jury failed

to find irreparable harm and therefore its verdict

should be disregarded [CR; 143-157]. In light of the

law and how the case was tried, that assertion is

invalid. The Appellee cited to Zapata v. Zapata 841

S.W. 2d 45 (Tex. App.—Houston [14th Dist], 1992) for the

proposition that a jury must find irreparable harm.

First of all, Zapata was decided on a directed verdict,

the case never reached the jury nor was there a jury

charge in that case. In other words the Court decided

the issue, not the jury. In this case, the only issues

required to be submitted to a jury were submitted based

11 on the elements of common law trade infringement in

Texas. To prevail in its common-law action for trade

name infringement, Plaintiff has the burden to

establish the following elements: (1) that the name it

seeks to protect is eligible for protection, (2) that

it is a senior user of the name, and (3) that there is

a likelihood of confusion between its name and that of

the other user, Zapata Trading Corp v. Zapata Trading,

Int’l, Inc. 841 S.W. 2d 45, 47 (Tex. App.--Houston

[14th Dist.] 1992, no writ) (citing Union Nat'l Bank v.

Union Nat'l Bank, 909 F.2d 839 (5th Cir.1990)).

There was never an issue that the name was capable

of protection. To determine the distinguishing

capability of a mark or a trade name, and thus its

eligibility for protection, courts employ the classic

trademark continuum articulated in Abercrombie & Fitch

Co. v. Hunting World, Inc., 537 F.2d 4, 9 (2nd Cir.

1976); Pebble Beach Co v. Tour 18 I Ltd., 942 F. Supp.

1513, 1537 (S.D. Tex., 1996). A mark or name may be (1)

fanciful, (2) arbitrary, (3) suggestive, (4)

descriptive, or (5) generic. Id. Fanciful, arbitrary,

12 and suggestive marks are inherently distinctive and

therefore protectable without an additional showing of

consumer identification. Id. At the other end of the

continuum are generic marks, which are never

protectable because they represent the name of the good

or service itself and therefore cannot identify or

distinguish a particular source. Id. Descriptive marks

fall somewhere in between. These marks describe a

characteristic of the good or service itself and may

not be protected absent a showing that the mark has

become associated in the minds of consumers with the

particular, albeit unknown, source. Pebble Beach Co..

v. Tour 18 I, Ltd., 155 F.3d 526 (5th Cir. 1998). This

association is called secondary meaning. Id.

Appellant’s trade name “Tesoro Corporation,”

derives from the Spanish name for “treasure” and in

addition to being at the far end of the spectrum where

names are protectable without any showing of consumer

identification, the evidence adduced at trial shows

that after 37 years of business Tesoro Corporation has

also acquired consumer identification. Evidence

13 showing long and extensive use has been held sufficient

to prove a trade name has acquired secondary meaning.

Douglas v. Walker, 707 S.W.2d 733, 734 (Tex. App.--

Beaumont 1986, no writ).

In this case, Appellant was willing to allow

Defendant to call itself Tesoro Petroleum, it simply

would not allow Appellee to use Tesoro Corporation. If

the Appellant’s trade name had no importance the

Appellee would have not begun to use it without

permission, nor would it be so resistant in

relinquishing the name. The Texas Secretary of State’s

office clearly recognized the combination of Tesoro and

Corporation into one name as being worthy of

registration and the evidence at trial demonstrated

that the Defendant thought it was protectable enough to

seek to use or buy it before simply trying to usurp the

name [RR:V:9-15, RR:V:41-4; RR: V:60-72; RR:V:84-87].

Appellee tried to argue that it, not the Appellant,

was the senior user. The Court granted a directed

verdict in Appellant’s favor on the issue of senior

user before the jury phase of the trial began [RR:V:

14 150-151; RR:XI:35] The Appellee is simply wrong about

the issue. It has never been about who was the senior

user of “Tesoro” or “Tesoro Petroleum” but rather who

was the senior user of “Tesoro Corporation.” The jury

found that “Tesoro Corporation” was Plaintiff’s trade

name and by using that exact name, Defendant caused

actual confusion [RR:XI:75]. In this case the evidence

showed that the senior user of “Tesoro Corporation” was

not disputed, every Defendant witness, whether offered

by the Defendant or the Plaintiff had testified that

Plaintiff was the senior user of the name at issue

“Tesoro Corporation” [RR:V:84-85; RR:V:61-72]. Having

rejected the Defendant’s argument that the fight was

over the name “Tesoro” and not “Tesoro Corporation,” it

was entirely appropriate to grant directed verdict for

the Plaintiff as to the senior user of “Tesoro

Corporation” when even the Defendant admitted that to

be the case.

B. There Was Irreparable Harm:

Thus Appellee was left with the argument that there

was no irreparable harm. However, a finding of

15 likelihood of confusion brings with it a presumption of

irreparable harm. So the analysis, much like that in

Zapata v. Zapata also cited herein above, is whether

there was “evidence” to support a particular finding.

In this case, just as in Zapata v. Zapata 841 S.W. 2d

45, 48-49, the Plaintiff demonstrated actual confusion

[RR:IV: 129-192; RR:IV: 259-270] and proof of actual

confusion is probative evidence that likelihood of

confusion exists, Zapata Trading Corp v. Zapata

Trading, Int’l, Inc. 841 S.W. 2d 45, 48 (Tex. App.—

Houston [14th Dist] 1992 no writ). In fact, once actual

confusion is proved, an almost overwhelming amount of

proof is necessary to refute the existence of a

likelihood of confusion. Id.; see also Fuji Photo Film

Co. v. Shinohara Shoji Kabushiki Kaisha, 754 F.2d 591,

597 (5th Cir.1985). In this case not only was there

proof of actual confusion as cited herein above, but

the record reflects no real effort by the Defendant to

refute the actual confusion. Once the jury found

likelihood of confusion the irreparable nature of the

harm was established and the Court was free to presume

16 irreparable injury, See Brennan's, Inc. v. Brennan's

Rest., L.L.C., 360 F.3d 125, 129 (2d Cir.2004); Ty,

Inc. v. Jones Group, Inc., 237 F.3d 891, 902 (7th

Cir.2001); GoTo.com, Inc. v. Walt Disney Co., 202 F.3d

1199, 1209 (9th Cir. 2000); Circuit City Stores, Inc.

v. CarMax, Inc., 165 F.3d 1047, 1056 (6th Cir.1999);

McDonald's Corp. v. Robertson, 147 F.3d 1301, 1310

(11th Cir.1998); Pappan Enters., Inc. v. Hardee's Food

Sys., Inc., 143 F.3d 800, 805 (3d Cir.1998); Societe

Des Produits Nestle, S.A. v. Casa Helvetia, Inc., 982

F.2d 633, 640 (1st Cir.1992); Black Hills Jewelry Mfg.

Co. v. Gold Rush, Inc., 633 F.2d 746, 753 n. 7 (8th

Cir.1980).3

C. There is no Adequate Remedy at Law:

The corollary to lack of irreparable harm is the

argument that there is an adequate remedy at law. The

determination of whether an adequate remedy at law

exists is not a mechanical task. The mere existence of

a remedy at law is not a ground for a denial of

3 At trial and during hearings the Appellee tried to argue that because these cases were temporary and not permanent injunction cases, the presumption should not apply. There is no valid reason to limit the presumption to temporary status quo relief versus permanent injunctive relief.

17 injunctive relieve unless the legal remedy is as

practical and efficient to the ends of justice as the

equitable remedy, Jeter v. Associated Rack Corp., 607

S.W.2d 272, 278 (Civ. App.—Texarkana 1980, ref.

n.r.e.). Thus, while a plaintiff may have a right to

bring an action for damages, that remedy is inadequate

if damages cannot be calculated. Texas Soc. v. Ft. Bend

Chapter, 590 S.W.2d 156, 159 (Civ. App.—Texarkana 1980,

ref. n.r.e.).

As set out in the testimony of Paul Sullivan it is

impossible to calculate monetary damages [RR:IV:129-

192: RR: VIII: 70-103]. The instances of confusion are

continuous and haphazard. The effects on credit and

goodwill are impossible to gauge and may be immediate,

or may create long-term problems that do not

immediately manifest themselves. Since it is impossible

to know when the confusion will again re-surface, it is

equally impossible to prepare for the problems or to

take prospective action to mitigate harm. The

impossibility of calculating damage in part contributed

to the Plaintiff’s decision to drop his monetary claims

18 prior to the commencement of the jury trial. Appellant

simply could not calculate the harm in a monetary

sense.

Did the District Court err in Granting the Appellee’s Motion to Set Aside the Jury Verdict based on Improper Jury Charge and Instructions.

The Appellee would have the Court believe that the

failure to present “irreparable injury” to the jury is

defective and precludes granting a summary judgment.

It cites a long list of cases including Zapata v.

Zapata 841 S.W. 2d 45 (Tex. App.—Ho [14th Dist], 1992)

for the proposition that a jury must find irreparable

harm. That statement is blatantly incorrect. In a

trademark infringement case the question of “likelihood

of confusion” is a question for the trier of fact.

Zapata v. Zapata 841 S.W. 2d 45, 49. See also Soweco v.

Shell Oil Co., 617 F.2d 1178, 1186 (5th Cir.1980),

cert. denied, 450 U.S. 981, 101 S. Ct. 1516, 67 L.Ed.2d

816 The only matters submitted to a jury in Texas are

the elements of a cause of action that a jury is

19 required to answer. There is no jury charge in Texas

for a permanent injunction because a permanent

injunction and the elements require of it are to be

determined by the Court in its sound discretion.

The Jury charge in this case was as follows:

Question one. Do you find from a preponderance of the evidence that Tesoro Corporation is the trade name of the Plaintiff? A trade name is any designation which is adopted and used by a person to denominate goods which the markets or services which he renders or a business which he conducts or has come to be so used by others.

Answer yes or no.

If you answered yes to question number one, then answer question number two. Otherwise, do not answer question number two.

Question number two. Do you find from a preponderance of the evidence that there exists a likelihood of confusion between the Plaintiff's corporation and the Defendant's corporation by any consumer?

Answer yes or no. [RR:VI:6-7].

The Appellee’s only objections to the Court’ charge and

instructions[RR: V: 164-170; RR: XII: Exhibit 1] wholly

failed to raise any issue as to the submission of

irreparable harm and/or adequate remedy at law, an

20 objection it raised for the first time in its Motion to

Disregard two months later.

In the hearing on May 21, 2013 the Appellee

attempted to argue that because there was a claim for

common law trademark infringement and a claim for a

declaratory action, that some how these claims were

“separate’ and their elements were not “necessarily

referable” to one another, and that by failing to

present the issue of irreparable harm to the jury the

Appellee had not know what it need to respond to

[RR:VII:31-38]. The key to the Appellee’s argument

lies in the declaratory judgment action not being

necessarily referable to the common law trademark

infringement case. The facts of each were identical.

There were no “two unrelated claims” such that the

Appellee would have been confused as to which claim was

being asserted. In this case there was only one claim,

common law trademark infringement, the declaratory

action was simply a mode of relief, it did not have one

single different fact or element and the Appellee’s

failure to object was fatal to its claim [CR:34-35]. To

21 give any credence to the Appellee’s contention would be

to say “we were confused by the claim for relief under

the common law trademark infringement cause of action

and by the request that the Court declare Defendants

actions a violation of Texas Common law trade

infringement law.” It is simply not a tenable argument.

The Defendants cite to Hudgens v. Goen 673 S.W. 2d

420 (Tex. App-Waco, 1979) for the same proposition and

that case is equally flawed. In Hudgens the cause of

action was not common law trade infringement, but

unfair competition. Based on Miller v. Lone Star

Tavern, Inc. 593 S.W.2d 341 (Tex. Civ. App.--Waco 1979,

no writ) irreparable harm was a necessary third element

of the main cause of action, not the injunctive relief.

More important, the Court then went on to say that the

third element found in Miller, of irreparable harm, was

not required for a plaintiff to be entitled to

injunctive relief when the cause of action is based on

unfair competition Hudgens v. Goen 673 S.W. 2d 420,

423. In this case, irreparable harm has never been an

element of a trade infringement case. Rather it is an

22 element of a permanent inunction and that issue is left

to the Court which must look to the underlying

evidence, not the jury charge.

In an amendment to its Motion to Set Aside [CR:

143-156] appellee cited to Physicians and Surgeons Gen.

Hosp. v. Koblizek 752 S.W. 2d 657, 660 (Tex. App.—

Corpus Christ, 1988) that seems to stand for the

proposition that having refused to submit a jury

question, this Court could not have previously made the

determination that there was no question of fact to

submit to the jury and therefore could not have granted

a directed verdict. That is not what Physicians and

Surgeons Gen. Hosp. v. Koblizek stands for. Rather,

that case stands for the following proposition:

The trial court was not authorized to find on its own that the answers found by the jury created an unreasonable risk of harm. That was a disputed and essential factual issue which was never requested by appellees or presented to the jury. The trial court was prevented from making a finding on the omitted issue and such circumstances require that judgment be rendered for appellant. Cameron County v. Velasquez, 668 S.W.2d 776, 781 (Tex.App.--Corpus Christi 1984, writ ref'd n.r.e.).

23 In Physicians and Surgeons Gen. Hosp. v. Koblizek the

trial judge had refused an issue on whether the

hospital “knew” that the conditions of its floor had

created an unreasonable risk of harm. That was an

essential element of the cause of action (Emphasis

Added) and it remained disputed after the presentation

of evidence. Irreparable harm/adequate remedy at law is

simply not an essential element of a common law trade

infringement case, both become relevant only in the

event of a request for injunctive relief which falls

squarely into the realm of the trial judge’s authority.

More important, in a common law trade infringement

case the entire case can be tried to the Court and it

determines both facts and law. Thompson v. Thompson Air

Conditioning & Heating, Inc., 884 S.W.2d 555, (Tex.

App.-Texarkana 1994, no pet.); All Am. Builders, Inc.

v. All Am. Siding of Dallas, Inc., 991 S.W.2d 484,

(Tex. App.-Fort Worth 1999, no pet.). In this case

only the injunction phase has been bifurcated and just

as in Thompson, the Court’s findings of factual issues

24 relating to the injunctive relief are every bit as

proper and binding as a jury’s.

In granting a permanent injunction the standard of

review is clear abuse of discretion by a trial court,

not a jury. See 2300, Inc. v. City of Arlington, 888

S.W.2d 123, 126 (Tex. App.--Fort Worth 1994, no writ).

A trial court’s ruling is however reversible on appeal

if it acts without reference to any guiding rules and

principles. See Downer v. Aquamarine Operators, Inc.,

701 S.W.2d 238, 241-42 (Tex.1985), cert. denied, 476

U.S. 1159, 106 S. Ct. 2279, 90 L.Ed.2d 721 (1986).

Thus, the jury does not find “irreparable harm,” it

finds likelihood of confusion in an infringement case

and the Court must look to the record to see if the

Plaintiff has “evidence to support irreparable harm.”

In this case evidence clearly exists and there was no

requirement to submit the issue to the jury. If a jury

finding was necessary there would be no case law

allowing the Court to grant or deny an injunction based

on “conflicting evidence.” A jury finding would take

25 that discretion from the Court and that is not the law

in Texas.

Finally, the Appellee’s argument completely

overlooks the legal effect of the likelihood of

confusion element that is submitted to a jury in a

common law trade infringement case. In virtually every

circuit in the United States the appeals courts have

expressly adopted the holding that a court may presume

irreparable injury upon finding a likelihood of

confusion in a trademark case. See Brennan's, Inc. v.

Brennan's Rest., L.L.C., 360 F.3d 125, 129 (2d

Cir.2004); Ty, Inc. v. Jones Group, Inc., 237 F.3d 891,

902 (7th Cir.2001); GoTo.com, Inc. v. Walt Disney Co.,

202 F.3d 1199, 1209 (9th Cir. 2000); Circuit City

Stores, Inc. v. CarMax, Inc., 165 F.3d 1047, 1056 (6th

Cir.1999); McDonald's Corp. v. Robertson, 147 F.3d

1301, 1310 (11th Cir.1998); Pappan Enters., Inc. v.

Hardee's Food Sys., Inc., 143 F.3d 800, 805 (3d

Cir.1998); Societe Des Produits Nestle, S.A. v. Casa

Helvetia, Inc., 982 F.2d 633, 640 (1st Cir.1992); Black

Hills Jewelry Mfg. Co. v. Gold Rush, Inc., 633 F.2d

26 746, 753 n. 7 (8th Cir.1980). Although the 5th Circuit

has not expressly adopted the holding it has done so

implicitly in S. Monorail Co. v. Robbins & Myers, Inc.,

666 F.2d 185, 188 (5th Cir. Unit B 1982) and districts

throughout the Fifth Circuit recognize that a finding

of likelihood of confusion is a finding of irreparable

harm/injury. Quantum Fitness Corp. v. Quantum Lifestyle

Ctrs., L.L.C., 83 F.Supp.2d 810, 831 (S.D.Tex.1999).

In short, Appellee’s argument as to the charge fails at

every level and because of the unique nature of an

infringement case, the likelihood of confusion finding

establishes irreparable harm.

In addition, the argument is disingenuous given the

fact that the Appellee knew that the case would be

tried in a bifurcated manner, with the entire

injunction issue left to the Court. The Appellee even

filed and had granted, a motion for continuance seeking

time to develop more evidence for the injunction phase

and in fact have took the Appellant’s deposition for a

third time in this case. The argument of a defective

jury charge has no merit.

27 Issue #3

Even if the Court Rejected the Appellee’s Motion ot Set Aside Jury Verdict Did the District Court err in Denying Appellant’s Request for Permanent Injunction after the Full Hearing.

In light of the facts that the Appellant won a jury

verdict as to Tesoro Corporation being its trade name

and the Appellee’s use of that name creating the

likelihood of consumer confusion, was given a directed

verdict as to being the senior user, and presented in

evidence at trial and the permanent injunction hearing

of irreparable harm and no adequate remedy at law, the

Trial Court erred in denying injunctive relief.

To obtain a permanent injunction, a plaintiff must

prove (1) the existence of a wrongful act, (2) the

existence of imminent harm, (3) the existence of

irreparable injury, and (4) the absence of an adequate

remedy at law. Jim Rutherford Investments Inc. v.

Terramar Beach Community Ass'n., 25 S.W.3d 845, 849

(Tex. App.—Hous. [14 Dist.] 2000, pet. den’d). In the

present case the Plaintiff has established its common

law trade infringement claim and has therefore

28 established the existence of a wrongful act which in

addition to be wrongful, is on-going. Therefore, what

the Court must determine is the existence of the

remaining three elements.

A. Standard of Review:

review is clear abuse of discretion. See 2300, Inc. v.

City of Arlington, 888 S.W.2d 123, 126 (Tex. App.--Fort

Worth 1994, no writ). A trial court’s ruling must be

based upon some reference guiding rules and principles.

See Downer v. Aquamarine Operators, Inc., 701 S.W.2d

238, 241-42 (Tex.1985), cert. denied, 476 U.S. 1159,

106 S. Ct. 2279, 90 L.Ed.2d 721 (1986). An abuse of

discretion exists where the trial court lacks evidence

in the record which reasonably supports that trial

court's decision. Davis v. Huey, 571 S.W.2d 859, 862

(Tex.1978); Recon Exploration, Inc. v. Hodges, 798

S.W.2d 848, 852 (Tex.App.--Dallas 1990, no writ).

B. Imminent Harm:

In order to justify a permanent injunction the

underlying injury must be real and substantial Parkem

29 Indus. Servs., Inc. v. Garton 619 S.W. 2d 428, 430

(Tex. Civ. App.—Amarillo 1981, no writ). An injunction

will not issue to prevent merely speculative harm,

Camarena v. Texas Employment Comm’n, 754 S.W. 2d 149,

151 (Tex. 1988). In this case the harm was and is both

real and on-going. The evidence adduced at trial shows

a clear confusion created by the Defendant’s use of

Texas Tesoro’s name. Appellant demonstrated actual

confusion [RR:IV:129-192; RR:IV:259-270] and based in

part on that evidence, the jury found likelihood of

confusion. Where likelihood of confusion exists in a

trademark or trade name case, the case law in Texas is

clear that the plaintiff's lack of control over the

nature and quality of the defendant's goods or services

constitutes an immediate (and in fact irreparable

injury), regardless of the actual quality of those

goods or services. See Joy Mfg. Co. v. CGM Valve &

Gauge Co., 730 F. Supp. 1387, 1394 (S.D.Tex.1989);

Chemlawn Servs. Corp. v. GNC Pumps, Inc., 690 F.Supp.

1560, 1569 (S.D.Tex.1988); Pro Hardware, Inc. v. Home

30 Ctrs of America, Inc., 607 F. Supp. 146,154

(S.D.Tex.1984).

As set out above, evidence of the imminence of the

harm to the Plaintiff was adduced in the testimony from

Richard Shell and from Paul Sullivan that showed based

on the actual confusion there was a real and on-going

damage to the Appellant’s business in Texas. In

addition, since the trial, additional events testified

to by Mr. Sullivan show that the Defendant’s actions

now had Appellant identified in the public forum as a

“Donna based” oil and gas company [RR:VIII:70-103,

RR:XIV: Exhibit 2, pp.11]. Appellant clearly had and

has no control over the actions and business practices

of Appellee and the Appellee’s perceived presence in

Texas completely overshadows the business enterprise of

Appellant even though the two companies are in

different businesses. Again, it bears repeating that

Plaintiff’s evidence of actual confusion was never

refuted by any Defense witness and proof of actual

31 Trading, Int’l, Inc. 841 S.W. 2d 45, 48 (Tex. App.—

Houston [14th Dist] 1992 no writ), a fact that did not

escape the jury.

C. Irreparable Injury and Adequate Remedy at Law:

Irreparable injury and adequate remedy at law

although distinct elements of a permanent injunction

often become intertwined because proof of an

irreparable injury in many cases is done by showing

that there is no adequate remedy at law. Appellee has

red to focus on the magnitude of harm and somehow

downplay the actual damage to Appellant. However,

federal courts have long recognized that it is not so

much the magnitude but the irreparability that counts

for purposes of an injunction and ....[A]n injury is

irreparable only if it cannot be undone through

monetary remedies .... The absence of an available

remedy by which the movant can later recover monetary

damages ... may ... be sufficient to show irreparable

injury. Enter. Int'l, Inc. v. Corporacion Estatal

Petrolera Ecuatoriana, 762 F.2d 464, 472–73 (5th

Cir.1985).

32 1. Irreparable Injury:

At least one district court in the Fifth Circuit

has held that in a trademark case, “[w]hen a likelihood

of confusion exists, the plaintiff's lack of control

over the quality of the defendant's goods or services

not only shows imminent harm, but constitutes an

irreparable injury, regardless of the actual quality of

those goods or services.” Quantum Fitness Corp. v.

Quantum Lifestyle Ctrs., L.L.C., 83 F.Supp.2d 810, 831

(S.D.Tex.1999). The Fifth Circuit has neither expressly

adopted or a rejected the notion of a presumption of

irreparable injury where likelihood of confusion has

been shown to exist, S. Monorail Co. v. Robbins &

Myers, Inc., 666 F.2d 185, 188 (5th Cir. Unit B 1982).

But, as set out previously herein, several other

federal circuits have addressed this issue and

expressly held that a court may presume irreparable

injury upon finding a likelihood of confusion in a

trademark case. See Brennan's, Inc. v. Brennan's Rest.,

L.L.C., 360 F.3d 125, 129 (2d Cir.2004); Ty, Inc. v.

Jones Group, Inc., 237 F.3d 891, 902 (7th Cir.2001);

33 GoTo.com, Inc. v. Walt Disney Co., 202 F.3d 1199, 1209

(9th Cir. 2000); Circuit City Stores, Inc. v. CarMax,

Inc., 165 F.3d 1047, 1056 (6th Cir.1999); McDonald's

Corp. v. Robertson, 147 F.3d 1301, 1310 (11th

Cir.1998); Pappan Enters., Inc. v. Hardee's Food Sys.,

Inc., 143 F.3d 800, 805 (3d Cir.1998); Societe Des

Produits Nestle, S.A. v. Casa Helvetia, Inc., 982 F.2d

633, 640 (1st Cir.1992); Black Hills Jewelry Mfg. Co.

v. Gold Rush, Inc., 633 F.2d 746, 753 n. 7 (8th

Cir.1980).

Even absent a presumption based on likelihood of

confusion the courts have held that factually an injury

is also irreparable when compensatory damages are

extremely difficult to calculate. See Chemlawn Servs.,

690 F. Supp. at 1569; Pro Hardware, 607 F. Supp. at

154. Mr. Sullivan has provided more than adequate

evidence of irreparable harm/inadequate remedy at law

at this hearing and in the trial [RR:IV: 127-192; RR:

VIII: 70-103].

2. Adequate Remedy at Law:

34 The determination of whether an adequate remedy at

law exists is not a mechanical task. The mere existence

of a remedy at law is not a ground for a denial of

injunctive relief unless the legal remedy is as

n.r.e.)]. Thus, while a plaintiff may have a right to

As set out in the testimony of Paul Sullivan during

the permanent injunction portion of this proceeding, it

is impossible to calculate damages. The instances of

confusion are continuous and haphazard. The effects on

credit and goodwill are impossible to gauge may be

immediate, or may create long-term problems that do not

to know when the confusion will again surface, it is

35 take prospective action to mitigate harm. He simply

could not calculate the harm in a monetary sense

[RR:VIII:208-210.

Appellee’s sole effort to establish an adequate

remedy at law was the testimony of its expert, Gene

Trevino. Trevino’s entire testimony as to damages was

restricted to the cost of hiring someone to handle

telephone calls relating to the on-going confusion

generated by the Appellee’s wrongful usurpation of

Appellant’s name [RR:VIII:225-227]. However, Trevino

and the Appellee completely ignored all of the other

harm and the inability to calculate that harm, in great

part because Mr. Trevino’s client simply told him not

to look into that area of damage.

It as clear from Trevino’s trial testimony and his

deposition testimony that he only addressed “some of

the elements” of economic damages [RR:VIII:228]. When

pressed, Trevino admitted he was not even asked to try

and calculate economic damage. He claims there is no

economic loss, yet never did a calculation to make that

determination nor did he ever look at documents that

36 would have enabled him to even address the issue

[RR:VIII:229-232]. In his own words, “I didn’t do

anything.” [RR:VIII:232]. However, the lack of a

clearly discernable economic loss is the very essence

of irreparable harm that lacks a clear remedy at law.

Therefore, with no other evidence, other than Paul

Sullivan, Richard Schell, and the voluminous documents

provided as exhibits showing the inability to calculate

past economic harm, how can the Appellee even argue as

to either the extent of the harm or its irreparable

nature? It cannot.

When asked directly to confront the issue of future

harm, Trevino fell back on his telephone answering cost

analysis and then admitted, he was not asked to do a

calculation of future economic harm [RR:VIII:232-233].

Then after admitting he had no basis for any of his

numbers, he admitted he had no way of know the degree,

the frequency, or the intensity of any future confusion

and harm and that no one could ascertain that

[RR:VIII:234-236]. More important he was not asked,

and therefore did not perform, any calculation on loss

37 of good will, loss of reputation, loss of credit,

future attorney’s fees or any other factor. The only

quantifiable damage he calculated was phone calls,

because in the end he was not asked to do anything else

and so he did not [RR:VIII:236-239, 243-246]. The

problem is the Appellee should have done so because Mr.

Trevino was the only witness offered to refute the

Appellant’s case on irreparable harm and lack of

adequate remedy at law and by his own admission he

looked at only one narrow area.

D. The Record Shows a Complete Absence of any Guiding Principles or Rules Upon Which the Court Relied in Denying Injunctive Relief.

1. Requested Scope:

(i) State Wide Prohibition of Use:

The Appellant requested an injunction preventing

the Appellee from using the Plaintiff’s trade name

anywhere in the state of Texas [RR:IV:175-176;RR:XI:36-

36;CR:297-303]. The harm that has befallen the

Appellant has flowed directly from the Appellee’s

assumed name filing. In effect consumers and business

entities are searching the Texas Secretary of State

38 data basis and finding Tesoro Corporation listed as a

San Antonio based oil & gas company. To allow the

Appellee to continue to use the Appellant’s name

anywhere in Texas will only continue the confusion.

Having prevailed on its trade name infringement claim,

Appellant was entitled to deny the Appellee the use of

its trade name throughout the state. Even Appellee’s

alleged expert, Mr. Trevino admitted that a business

is entitled to do operate and solicit business state-

wide and that he in fact has his own business name and

can do business state-wide [RR:XI:26-30]. Both

Appellant’s request and Appellee’s admissions of state-

wide rights find support in Texas law.

(ii) Presumption of State-Wide Rights:

A certificate of registration issued by the

Secretary of State under the provisions of the Texas

Trademark Act is admissible in evidence as prima facie

proof of: 1) the validity of the registration; 2) the

registrant's ownership of the mark; and 3) the

registrant's exclusive right to use the mark through-

out the state of Texas in connection with the goods or

39 services specified in the certificate, subject to any

conditions or limitations stated therein. Tex. Bus. &

Comm. Code § 16.15(c) (1968). The Act specifically

provides that no registration of a trademark shall

adversely affect common law rights acquired in a

trademark prior to its registration. While a mark

remains effectively registered, no common law right may

be acquired against the owner unless he abandons such

mark. Tex. Bus. & Comm. Code s 16.27(a) (1968). Cano v.

Macarena, 606 S.W.2d 718, 722 (Tex. Civ. App. 1980). It

is undisputed that Mr. Sullivan had properly registered

the mark and that it was in place continuously since

1975 [RR:IV:43; RR: XII: Exhibits 24-25].

The registration of Tesoro Corporation created

certain protections as to its exclusive right to use

that name. The jury verdict in this case has confirmed

the principle established in Cano v. Macarena, 606

S.W.2d 718, 722 that Appellee acquired no rights in the

name Tesoro Corporation and in fact has violated the

Appellant’s rights. To give the Appellant less than

exclusive state-wide use is to reward Appellee’s

40 efforts by providing Appellant less than what the plain

reading of the law provides. In addition, the problem

is more complex because even if Appellee was restricted

to some small corner of one county in Texas, the fact

that it continues to be allowed to list “Tesoro

Corporation” as its assumed name lies at the center of

the confusion. Appellant receives calls from out-of-

state state regulator’s, taxing authorities, creditors,

consumers, and other persons [RR:IV:127-192;

RR:VIII:70-103], based on what is on file with the

Texas Secretary of State. Therefore, not only should

Appellee not be allowed to use the name in Texas, but

its assumed name registration should be withdrawn or

the harm to the Appellant continues unabated.

(iii) Actual Use and Business Transactions:

In addition to the nature of the harm occasioned by

the Appellee’s continued use of Tesoro Corporation,

evidence presented in this case demonstrates the state-

wide presence of the Appellant, including a significant

and long-established presence in Bexar County that

continues today that even Appellee’s expert had to

41 acknowledge [RR:XI:17-24]. Appellant is in every region

of the state including Bexar, Dallas, Harris, Tarrant

and El Paso counties. In addition to Texas’ major

cities, the counties virtually encircle every large

metropolitan area in the state. In West Texas where

Plaintiff presence is not as pronounced, he

nevertheless does business in every county with any

significant population center that would seek out and

utilize sign-based advertising. In addition, in those

areas of the state, the metropolitan areas are also the

places where business in the outlying counties would be

acquired. For example, the county seat of Tom Green

County is San Angelo and San Angelo is the closest city

where business is conducted for at least a 10-12 county

surrounding area.4

It is also important to note that the counties

where the Appellant actively does business are also the

areas where the Appellee and its business is very

likely to operate and create the same type of confusion

4 By way of illustration Plaintiff in west Texas where Plaintiff is not in every county it does business in Potter County (Amarillo), Lubbock County (Lubbock), Taylor County (Abilene), Midland County (Midland), Ector County (Odessa), El Paso County, (El Paso), and Val Verde County (Del Rio).

42 that has been testified to in this case. Tom Green,

Ector, Midland and the contiguous and near-by counties

are now at the very center of a re-vitalized Texas oil

and gas industry. Allowing the Appellee to use the

Appellant’s trade name anywhere in these areas invites

the same confusion and harm that gave rise to the

lawsuit.

(iv) All Speech Mediums:

The evidence adduced at trial and at the permanent

injunction hearing shows that beginning in 2009 when

Appellee began using Tesoro Corporation as its assumed

name, the confusion became disseminated through a

variety of mediums, all of which contribute to the

underlying problem and must be stopped. At issue here

is the ability of a Court to regulate speech and its

natural corollary, the printed word. However it is not

any speech, but commercial speech that the Plaintiff

seeks to enjoin.

Commercial speech in any form occupies one of the

lowest rungs on the First Amendment hierarchy, enjoying

only a "limited measure of protection, commensurate

43 with its subordinate position in the scale of First

Amendment values, and is subject to modes of regulation

that might be impermissible in the realm of

noncommercial expression." Bd. of Trustees v. Fox, 492

U.S. 469, 477, 109 S.Ct. 3028, 106 L.Ed.2d 388 (1989)

(quoting Ohralik v. Ohio State Bar Ass'n, 436 U.S. 447,

456, 98 S.Ct. 1912, 56 L.Ed.2d 444 (1978)). Commercial

speech does "no more than propose a commercial

transaction" and may be freely regulated. Pittsburgh

Press Co. v. Pittsburgh Comm'n on Human Relations, 413

U.S. 376, 385, 93 S.Ct. 2553, 37 L.Ed.2d 669 (1973).

In Central Hudson Gas & Electric Corp. v. Public

Service Commission of New York, 447 U.S. 557, 566, 100

S. Ct. 2343, 65 L.Ed.2d 341 (1980), the Supreme Court

outlined its method of analyzing the lawfulness of

restrictions on commercial speech:

In commercial speech cases, then, a four-part analysis has developed. At the outset, we must determine whether the expression is protected by the First Amendment. For commercial speech to come within that provision, it at least must concern lawful activity and not be misleading. Next, we ask whether the asserted governmental interest is substantial. If both inquiries yield positive answers, we must determine whether the

44 regulation directly advances the governmental interest asserted, and whether it is not more extensive than is necessary to serve that interest. Misleading commercial speech, is not protected by the First Amendment. Thompson v. W. States Med. Ctr., 535 U.S. 357, 367, 122 S. Ct. 1497, 152 L.Ed.2d 563 (2002).

As the Central Hudson Court noted, "there can be no

constitutional objection to the suppression of

commercial messages that do not accurately inform the

public about lawful activity. The government may ban

forms of [235 S.W.3d 670] communication more likely to

deceive the public than to inform it...." Central

Hudson, 447 U.S. at 563, 100 S. Ct. 2343 (emphasis

added). Thus, "the government may freely regulate

commercial speech that ... is misleading," Florida Bar

v. Went For It, 515 U.S. 618, 623-24, 115 S. Ct. 2371,

132 L.Ed.2d 541 (1995) (citations omitted), and the

remaining Central Hudson factors apply only if the

speech is not misleading.

In this case it has already been established that

the speech Appellant seeks to enjoin is the improper

and impermissible use of Appellant’s own trade name.

45 The use by Appellee of that trade name has been found

by a jury to mislead and confuse the public and has

caused harm to the Appellant. The assertion that a

Texas court cannot enjoin the Appellee from using the

Appellant’s trade name is without legal or factual

foundation.

(v) Publicly Traded Stock Designation:

Appellee trades its publicly issued and held stock

on the New York Stock Exchange and its symbol, “TSO,”

is identified as “Tesoro Corporation and was founded in

1939 and is headquartered in San Antonio, Texas. While

the Appellee has the right to use the name as a

“Delaware Corporation” it use as being headquartered in

“San Antonio, Texas coupled with its assumed name

filing contributes to the confusion. Appellant

requested that as part of the permanent injunction that

Appellee be prohibited from referencing “Tesoro

Corporation” as a San Antonio, Texas Company.

(vi) Use of Appellant’s Trade Name on the Internet:

The Appellant is well aware of the maxim that

“equity will not do a vain thing.” The idea that this

46 Court or any regulatory body can take back or remove

four years of material that the Appellee has improperly

placed on the internet is absurd. However, A court can

prospectively prevent the Appellee, its agents,

employees, and personnel from using Appellant’s trade

name in the future. The starting point for this relief

is the Appellee’s web-site. The web-site is easily

accessed by simply typing in the Appellant’s trade

name, “Tesoro Corporation.” In addition the web-site

can be accessed by typing in “Tesoro Corp.” Appellee

has so completely co-opted the Appellant’s trade name

that when Tesoro Corporation is entered on the web,

Plaintiff’s business never appears. In order to reach

Tesoro Corporation one must enter “Tesoro Corporation,

Donna, Texas” [RR: VIII: 80-92]. Appellee’s

misapplication and misappropriation of Appellant’s

trade name has not only served as an improper use of

the name, but has allowed Defendant to virtually co-opt

the Appellant’s name.

An examination of the Appellee’s web-site not only

reveals that it purports to be Tesoro Corporation of

47 Texas, but Appellee also uses the site to disseminate

other material such as press releases, news

conferences, copies of its annual reports and social

responsibility reports to name just some of what is

published on the site, all of which use Appellant’s

trade name and perpetuate the confusion and harm that

already exists [RR: XII: Defendant’s Exhibit 7; RR:

XIV, Exhibit 3]. In Rescuecom Corp. v. Google, Inc.

562 F.3d 123 (2d Cir. 2009), the Court found that even

persons and entities several steps removed from the

actual infringer could be compelled to stop using a

trade name. In Rescuecom Corp. v. Google, Inc. the

federal court found that Google was infringing on a

mark through “keyword use” and that such a practice

qualified as “use” in commerce under the Lanham Act.

The keyword in this instance is “Tesoro Corporation,”

and as set out herein above and testified to in this

hearing, Defendant has completely co-opted that term on

the internet. Plaintiff does not even appear when it

inputs its own trade name.

48 2. In Light of the Appellant’s Evidence and the Virtual Absence of Appellee’s Evidence to the Contrary the Court Denied Appellant’s Injunctive Relief without Any Basis in Guiding Principles or Rules:

An abuse of discretion exists where a Court lacks

evidence in the record which reasonably supports that

trial court's decision. Davis v. Huey, 571 S.W.2d 859,

862 (Tex.1978); Recon Exploration, Inc. v. Hodges, 798

S.W.2d 848, 852 (Tex. App.--Dallas 1990, no writ). The

test for abuse of discretion is whether the court acted

without reference to any guiding rules and it is a

question of whether the court acted without reference

to any guiding rules and principles. Craddock v.

Sunshine Bus Lines, 134 Tex. 388, 133 S.W.2d 124, 126

(Tex.Comm.App.--1939, opinion adopted). Another way of

stating the test is whether the act was arbitrary or

unreasonable. Smithson v. Cessna Aircraft Co., 665

S.W.2d 439, 443 (Tex.1984); Landry v. Travelers

Insurance Co., 458 S.W.2d 649, 651 (Tex.1970). As set

out herein above, all of the evidenced adduced at trial

supports the following:

-The Appellee knowingly usurped Appellant’s trade name;

49 -The Appellee’s usurpation of the Appellant’s trade

name caused clear, actual confusion which creates an

almost irrebuttable presumption of likelihood of

consumer confusion;

-The Appellee made no effort to rebut the presumption;

-The Appellant presented abundant evidence of actual

harm for which no adequate remedy at law existed

-The only evidence of any quantification of damage, ie

of an adequate remedy at law, was the very limited

testimony of Gene Trevino that he admits covered only

his assertion of the cost of answering phones. He

admits to not looking at any other element of harm or

damage.

On what basis and upon what evidence did the Court

deny injunctive relief? The Court’s order is

completely silent on any basis for the judgment,

including whether the Court actually reached the issue

of injunctive relief at all. That factor alone should

be fatal to the Court’s denial of Appellant’s Request

for Permanent Injunction.

50 Issue#4

The District Court erred in denying Appellant’s Injunctive Relief based on Failure to Balance the Equities and/or Unclean Hands.

In addition to the factors required for trademark

and/or name infringement and the four elements of a

permanent injunction in Texas, the Texas courts have

articulated several sub-factors that must be

considered. Because the Trial Court’s judgment in this

case is virtually silent as to the underlying basis of

the decision, the Appellant must address these factors

as well because they were raised by Appellee during the

course of the trial.

A. Balancing the Equities:

There is a line of cases that suggests that a trial

court must balance the equities before issuing an

injunction and consider injury to (1) the defendant and

the public were the injunction granted and (2) the

complainant were the injunction denied. See Storey v.

Cent. Hide & Rendering Co., 148 Tex. 509 226 S.W.2d

615, 618-19 (1950). An injunction will ordinarily be

51 denied if the "injury to the complainant is slight in

comparison to the injury caused the defendant and the

public." Id. at 619. Conversely, an injunction may

issue if the injury to the defendant and the public is

slight when compared to injury suffered by the

complainant. See id. "Public convenience or necessity,

economic burden to the defendant, and the adequacy of a

legal remedy may affect this balance." McAfee MX v.

Foster, No. 02-07-080-CV, 2008 WL 344575, at *2, 2008

Tex.App. LEXIS 968, at *8 (Tex.App.-Fort Worth Feb. 7,

2008, pet. denied), petition for cert. filed, No. 08-

639 (U.S. Nov. 12, 2008).

However, the case cited most frequently in Texas is

Storey v. Central Hide & Rendering Co.,148 Tex. 509,

226 S.W.2d 615 and that case is a nuisance case.

Strictly speaking the doctrine of balancing the

equities does not even apply to a non-nuisance setting.

If this Trial Court applied the doctrine Appellant

would point out that the public suffers no injury

whatsoever by forcing Appellee to cease using the

Appellant’s trade name. Based on the nature of the

52 confusion demonstrated in this case, by clearly

delineating itself as Tesoro Petroleum, the confusion

caused to the public or the government seeking to reach

Appellee would virtually cease. The two “Tesoros”

would again be distinct as they were prior to 2004. The

evidence adduced at trial makes it clear that the

steady confusion Appellant suffers from did not begin

until after Tesoro Petroleum began using the

Appellant’s trade name.

The larger problem with this Trial Court having

applied an equity balancing test to deny the

Appellant’s injunctive relief is that the Appellee

presented no concrete evidence of harm that would have

been occasioned by a name change. In other words, it

gave the Court nothing to “balance.” Aside from some

conjecture from Appellee’s witness, Kelly Curll, at the

end of the Permanent Injunction hearing suggesting that

changing the name back to Tesoro Petroleum would result

in the demise of Tesoro Petroleum as a San Antonio

based company and with it the jobs, tax base and

possibly other unforeseen consequences [RR: IX: 62-75],

53 Appellee offered no equity to balance. It presented no

evidence of any real harm or cost to change the name.

Even Ms. Curll had no idea when asked what would really

happen if the Appellee had to change its name. When

asked if she could articulate the harm to Appellee, she

simply said “no.” [RR: IX: 68]. The one witness that

could have provided insight into the question,

Elizabeth Ising, offered nothing. Ms. Ising was a

Washington D.C. based attorney who handles matters of

corporate governance and Security Exchange Commission

issues for her clients. Since 2007 she has performed

those functions for Appellee [RR: IX: 6-8]. Over the

course of her direct testimony Ms. Ising testified as

to the requirements of a name change and what would

have to be done in order for Appellee to relinquish the

use of Appellant’s trade name in Texas. She indicated

three areas where Appellee would be affected, but

offered no testimony as to cost of such a name change

[RR: IX: 9-31]. On cross-examination Ms. Ising was

asked directly, what would she charge to change

Appellee’s name and she testified she “had no idea” and

54 could not quantify any financial harm to Appellee that

would be occasioned by a name change [RR: IX: 40, 42].

Any harm to the Appellee should have been totally

discounted because the uncontroverted evidence adduced

at trial indicates that Appellee knew the name it

wanted to use had been taken and that after being

refused the right to use the name, Appellee chose to

move ahead anyway with full knowledge that it might be

successfully sued for common law trademark/name

infringement. Both Mr. Parrish and Ms. Ryan testified

Appellee made the change because it suited it’s

business interest to do so. Ms. Ryan even testified

that the issue of Plaintiff’s ownership of “Tesoro

Corporation” was actually raised and that no one at

Appellee was concerned even though the very real

possibility existed that the Appellee could be sued for

trade name infringement. Therefore, any harm to the

Appellee is self-induced and the product of extreme

corporate arrogance.

55 B. Overly Broad:

Because this case will involved denying Appellee

access or use over a geographic area, Appellant

anticipated the Appellee raising the notion that the

injunction on a state-wide basis was “overly broad.”

Appellee put on testimony and cross-examined Paul

Sullivan on the issue as to where Appellant did

business. However, Appellee’s attack on where Appellant

did business was misplaced in the context of an

injunction because “overly broad” does not refer to the

geographical reach of an injunction, but rather to

something completely unrelated.

An injunction should be broad enough to prevent a

repetition of the evil sought to be corrected. Hitt v.

Mabry, 687 S.W.2d 791, 795 (Tex. App.-San Antonio 1985,

no writ) (citing Lower Nueces River Water Supply Dist.

v. Live Oak County, 312 S.W.2d 696, 701 (Tex.Civ.App.-

San Antonio 1958, writ ref'd n.r.e.)) An injunction

must not be so broad, however, as to enjoin a defendant

from activities that are a lawful and proper exercise

of his rights. Id. Where a party's acts are divisible,

56 and some acts are permissible and some are not, an

injunction should not issue to restrain actions that

are legal or about which there is no asserted

complaint. Hellenic Inv. v. Kroger Co., 766 S.W.2d

861, 866 (Tex. App.-Houston [1st Dist.] 1989, no writ).

Thus, the entry of an injunction that enjoins lawful as

well as unlawful acts may constitute an abuse of

discretion. Webb v. Glenbrook Owners Association, Inc.,

98 S.W.3d 374, 384 (Tex. App.—Dallas, 2009).

In this case “legality” did not pose an issue to

the entry of an injunction. Appellant’s right to the

name “Tesoro Corporation” has been sustained by a jury

verdict and that right extends to the state-wide use of

the name. There is no valid argument that Appellee

cannot legally use the name Tesoro Corporation in

Hidalgo County, but may do so in Bexar County. An

injunction that prohibits the use of the Plaintiff’s

trade name on a state-wide basis is completely

consistent with Plaintiff’s rights as conveyed by Texas

statute and as evidenced by his registration with the

Texas Secretary of State.

57 It is also important to note that this case does

not involve the enforcement of a non-compete clause.

There is significant case law in Texas that limits the

geographical reach of a non-compete to a “reasonable”

geographic area and time span. Light v. Centel Cellular

Co, 883 S.W.2d 642 (Tex. 1994). Isunai v. Manske-

Sheffield Radiology Group, 805 S.W. 2d 602 (Tex. App—

Beaumont, 1991); Gonzalez v. Zamora, 791 S.W.2d 258

(Tex. App.--Corpus Christi, 1990). That is not what is

at issue in this case. Appellant is not seeking to

prevent the Appellee from competing in the market place

in any county in Texas. Confusion among consumers is

the issue here and it has been established. Therefore,

in arriving at appropriate injunctive relief the Court

was not bound by the non-compete parameters established

in the employment field, but was free to award relief

consistent with the Appellant’s statutory right that a

jury had already determined was being infringed upon by

the Defendant.

58 C. Unclean Hands:

To the extent the Trial Court’s ruling reflects a

finding that Appellant lacked “unclean hands” that

ruling is completely in error. The Appellee argued that

Appellant’s corporate representative, Paul Sullivan,

used inappropriate language in deposition and put on

evidence to that effect. It is a timeless doctrine

that one who seeks equity must do equity and must come

to court with clean hands. See Dunnagan v. Watson, 204

S.W.3d 30, 41 (Tex. App.—Fort Worth 2006, pet. denied);

Flores v. Flores, 116 S.W.3d 870, 876 (Tex. App.—Corpus

Christi 2003, no pet.). Whether equitable relief should

be denied based on unclean hands is left to the

discretion of the trial court. Dunnagan, 204 S.W.3d at

41; Flores, 116 S.W.3d at 876. The only real

prohibition against applying the doctrine is the

requirement that it be confined to misconduct in regard

to, or at all events connected with, the matter in

litigation, so that it has in some measure affected the

equitable relations subsisting between the two

parties, and arising out of the transaction. Lazy M

59 Ranch, Ltd. v. TXI Operations, LP, 978 S.W.2d 678, 683

(Tex. App.-Austin 1998, pet. denied).

Based on a two-page brief that could not even tie

Appellant’s alleged conduct to any case authority, or

show how Appellant’s conduct in this case prejudice it

CR: 294-296], Appellee requested the Court to deny

Appellant’s injunctive relief based upon testimony

elicited form Mr. Sullivan as to alleged perjury that

his company had always been in good standing when in

fact it had lapsed once and he had to pay a $50 fee to

reinstate. In addition they alleged Mr. Sullivan had

violated an agreement to produce some documents during

the course of the litigation [RR:VIII:180-198].

Appellee also played excerpts from Mr. Sullivan’s three

depositions where he used in appropriate language.

However, the Appellee could not show any harm to it,

serious or otherwise, and the Court correctly stated

that the doctrine applies to events leading up to the

litigation [RR:VIII:198]. In addition, the lone case

cited by Appellee, Union Gas Corp. V. Gisler, 129 S.W.

3d 245 (Tex. App.-Corpus Christi, 2003), does not even

60 apply. In that case the interpleader had actually

caused the dispute giving rise to the need to

interplead the funds and the Court denied any equitable

relief to the interpleader. More importantly the Court

stated:

For a complainant to be entitled to relief in equity, it is necessary that he bring himself within the full meaning of the maxims that he who seeks equity must do equity, and that he who comes into equity must come with cleans hands. These maxims comprehend not only the previous conduct of the complainant toward the defendant, but also the attitude of the complainant toward the defendant throughout the litigation. The complainant must in good conscience offer to do equity and to have the court accord to the defendant all of his rights. Union Gas Corp. V. Gisler, 129 S.W. 3d 245, 153.

The Court in this case never sanctioned the Appellant

for any conduct, nor did the Appellee ever file any

pleading requesting any such relief. As sited to

above, not only were all of the Appellee’s rights

afforded it, but Appellee offered no evidence of any

kind as to how any of its rights were harmed or

affected, seriously or otherwise.

What makes this argument patently absurd is that

the Appellee’s conduct leading up to the litigation,

61 the arena where “unclean hands” traditionally and most

often applies, was wrought with fraud and a blatant

disregard of he Appellant’s rights. The Appellee’s own

conduct brought about the dispute, and it sought to

limit its damage by having the court reward it for its

conduct, conduct even the Court questioned as being

fraudulent [RR:XI:61].

Did the District Court err in vacating the Jury’s Attorney Fee award.

The Court’s denial of Appellant’s attorney’s fees

ignores two salient facts. First, the Appellant

prevailed in the jury trial. Second, the parties

stipulated to the amount of attorney’s fees in this

case to be afforded the prevailing party. That

stipulation is memorialized in a Rule 11 Agreement on

the record in this case [RR: V:128-129].

The Plaintiff was awarded a jury verdict [RR: VI:

75]. The jury had answered yes to both questions, that

“Tesoro Corporation” was the Appellant’s trade name and

that Appellee’s conduct had created a likelihood of

62 consumer confusion. Coupled with the Court’s directed

verdict on the issue of senior user [RR:V:151] the

result of the jury trial was a complete victory for he

Appellant. Under the terms of the Rule 11 Agreement

[RR:V: 128-129] Appellant’s attorney’s fees should have

been sustained.

CONCLUSION

The Appellant requests that this Court reverse the

Trial Court’s judgment and render a verdict. The Court

should grant the Appellant a permanent injunction

consistent with the Trial Court’s directed verdict on

the issue of senior user prior to the start of the

trial, the unanimous jury verdict finding the remaining

two elements required for common law trade

infringement, and the evidence presented showing both

irreparable harm and inadequate remedy at law. The

Defendant’s Motion to Set Aside Jury Verdict was

without merit. The jury instruction and charge did not

require a question as to irreparable harm because the

Appellant’s claim for common law trade name

infringement necessarily related to its request for

63 declaratory relief that was based on that sole claim.

There was no confusion created by the jury charge nor

did that charge omit any essential element of the

Appellant’s trade name infringement claim.

The requested scope of injunction was both

appropriate and within the scope of what the Trial

Court could provide. It placed the Appellant and

Appellee in the exact position they were in prior to

2004 when the Appellee knowingly and intentionally

usurped the Appellant’s trade name. To the extent that

the doctrine of balancing the equities has any

applicability to this case the Appellee put on no

evidence of any substance that demonstrated any

monetary harm to it as the result of having to change

its name back to Tesoro Petroleum. To the extent the

equities must be weighed, they all come down in favor

of the Appellant. The Appellee’s alleged hardship in

having to change its name is the direct result of its

own actions, taken with full knowledge that Appellant

owned the name Tesoro Corporation and that if it tried

to use that name in Texas it could be successfully sued

64 for common law trade name infringement. That same

arrogance brought Appellee, not Appellant, into Court

with unclean hands. Appellee’s two-page brief and

alleged evidence of discovery impropriety did not

deprive Appellee of one single vested right nor did it

occasion any harm. Throughout the four-year life of

the case Appellee never once moved for any relief in

the form of sanctions or otherwise against Appellant

for any reason. Finally, having prevailed upon both a

directed verdict and a jury verdict, the Appellant’s

entitlement to $100,000 in attorney’s fees should be

restored.

PRAYER

Appellant prays that this Court reverse the Trial

Court’s ruling and render a judgment in favor of

Appellant for the declaratory relief as set out herein

above and in the Trial Record and restore its

attorney’s fees award.

65 Respectfully Submitted,

/S/ Mark A. Weitz________ Reynaldo Ortiz SB#15324275 Ortiz & Millin LP 1305 E. Nolana, Suite F McAllen, Texas 78504 956-687-4567 965-631-1384 facsimile Mark A. Weitz SB# 21116500 Weitz Morgan PLLC 100 Congress Avenue Suite 2000 Austin, Texas 78701 512-394-8950 512-852-4446 (facsimile) ATTORNEYS FOR APPELLANT TESORO CORPORATION

CERTIFICATE OF SERVICE

The undersigned does hereby certify that on the 30th day of January, 2015, I caused to be served a true and correct copy of the foregoing Appellant’s Brief on Defendant Tesoro Corporation d/b/a Tesoro Petroleum Corporation by serving its attorney of Record, Frank Weahtered by electronic service and/or facsimile transmission and/or by United States First Class Mail, Return Receipt Requested.

/S/ Mark A. Weitz________ Mark A. Weitz

66 APPELLANT’S CERTIFICATE OF BRIEF

I, Mark A. Weitz, certify that Appellant’s Brief

filed in this case is in 14 point font, and the

footnote text is in 12 point font.

I further certify that this brief was prepared with

Microsoft Word 2011 for Mac, and that, according to

that program’s word-count function, the sections

covered by TRAP 9.4(i)(1) that the number of words in

this brief including footnotes (excluding any caption,

identity of parties and counsel, statement regarding

oral argument, table of contents, index of authorities,

statement of the case, statement of issues presented,

statement of jurisdiction, statement of procedural

history, signature, proof of service, certification,

certificate of compliance, and appendix) is 11,285.

Respectfully Submitted,

APPENDIX 1

Electronically Filed 7/2/2014 8:31:37 AM Hidalgo County District Clerks Reviewed By: Virginia Granados

Appendix 1 Electronically Filed 7/2/2014 8:31:37 AM Hidalgo County District Clerks Reviewed By: Virginia Granados

xxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx each party shall bear their own attorneys' fees. Electronically Filed 7/2/2014 8:31:37 AM Hidalgo County District Clerks Reviewed By: Virginia Granados

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

7/2/2014 xxxxxxxxxxxxxxxxx

CC:

Hon. Reynaldo Ortiz, Esq -EMAIL rey@leydeortiz.com; gh@leydeortiz.com Hon. Gerald Drought, ESq.-EMAIL gdrought@mdtlaw.com

Hon. Sarah Cowen, Esq. E-MAIL sarah@cowengarza.com

APPENDIX 2

APPENDIX 3

15:43:01 1 MR. DROUGHT: No, Your Honor.

15:43:02 2 THE COURT: Okay. In reference to the

15:43:03 3 motion for directed verdict, the -- I got a bit

15:43:19 4 sidetracked between what the -- the Plaintiff's Motion

15:43:25 5 For Directed Verdict was insofar as the Court's Charge.

15:43:31 6 Tell me again which issues you're asking for a directed

15:43:34 7 verdict on?

15:43:35 8 MR. ORTIZ: We were asking for a directed

15:43:37 9 verdict on -- on the issue of -- to grant the senior --

15:43:41 10 that senior -- that Mr. -- that Tesoro Corporation is

15:43:45 11 the senior user of that name in Texas.

15:43:48 12 Tesoro Corporation. Plaintiff is the senior user of

15:43:52 13 Tesoro Corporation in Texas.

15:43:53 14 THE COURT: Okay.

15:44:04 15 MR. DROUGHT: Your Honor, I think the Zapata

15:44:05 16 case sinks the ship for the Plaintiff. I'm sorry, but I

15:44:08 17 don't know any other clearer way to say it. Zapata is

15:44:12 18 Zapata, Tesoro is Tesoro.

15:44:14 19 THE COURT: Tesoro's not a geographic name.

15:44:18 20 Zapata, that's what they relied on, the geographic

15:44:21 21 perspective. And that's distinguishable from the

15:44:22 22 Thompson case that use surnames. And when you start

15:44:25 23 looking at the detailed information about what the

15:44:29 24 protected name is in a trademark case, there's major

15:44:29 25 distinction between surnames, geographic, generic names.

Appendix 3 151

15:44:34 1 I've read quite a few cases before this afternoon,

15:44:38 2 counsel, and I'm not getting any new information than

15:44:41 3 what I was led to believe and I wanted to give an

15:44:44 4 opportunity to be enlightened. I always welcome

15:44:48 5 enlightenment, but, with all due respect, I'll agree to

15:44:51 6 disagree with you, Mr. Drought, on the Zapata case

15:44:55 7 because of the -- the language used within it.

15:44:59 8 In reference to that Motion For Directed

15:45:01 9 Verdict, the court is going to grant Plaintiff's

15:45:04 10 directed verdict that the Plaintiff is the senior user

15:45:08 11 of the name Tesoro Corporation.

15:45:16 12 MR. DROUGHT: And our -- our objection is

15:45:17 13 noted obviously?

15:45:19 14 THE COURT: Absolutely.

15:45:21 15 Was there any other directed verdict?

15:45:23 16 MR. ORTIZ: No, Your Honor.

15:45:25 17 THE COURT: Okay. While we were off the

15:45:32 18 record and in reviewing the proposed charges again, it

15:45:38 19 came to my head that it would be wise to suggest to both

15:45:45 20 sides to modify your stipulation breaking it down even

15:45:52 21 further as to the different levels; trial, Court of

15:45:57 22 Appeals and Supreme Court. Did anyone want to heed that

15:46:01 23 advice? And if you don't, that's fine.

15:46:04 24 MR. ORTIZ: We did, Your Honor. We

15:46:05 25 conferred many times but we were unable to reach an