Marshak v. Sheppard

Citation: 381 F. Supp. 3d 261Docket: 86-cv-9960 (JGK)

Court: District Court, S.D. Illinois; May 23, 2019; Federal District Court

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Rick Sheppard filed a motion to vacate a permanent injunction issued by the Court on August 26, 1987, which prohibited him from using the service mark "The Drifters," owned by Larry Marshak, due to Sheppard's infringement. The motion was made under Federal Rule of Civil Procedure 60(b)(6) and Rule 60(d)(3), but the Court denied it. 

The original litigation involved claims by Marshak that Sheppard had infringed on a valid service mark. Sheppard had argued that Marshak obtained the mark through fraudulent representations to the Patent and Trademark Office (PTO), specifically that Marshak's assignors misled the PTO by denying the existence of competing rights. However, the Court found Sheppard's arguments unconvincing and ruled that he willfully infringed the mark.

Subsequent legal proceedings involved Faye Treadwell, who also claimed infringement and argued fraud regarding the mark's registration. A jury found that Marshak had obtained the mark fraudulently but later ruled that although Treadwell was the rightful owner, she had abandoned the mark, thus granting Marshak common law rights. This decision was upheld on appeal, and the Court ordered the PTO to cancel the mark and prohibited Marshak from using it.

In 2017, Treadwell and Marshak reached an agreement that vacated the earlier injunction, permitting Marshak to use the mark. In October 2018, Sheppard sought to vacate his injunction, asserting that Marshak's threats of legal action against concert promoters had interfered with his business opportunities, leading to canceled performances in 2017. Sheppard claimed these threats referenced the 1987 Court decision.

Sheppard requests to vacate an injunction against him on two bases: under Federal Rule of Civil Procedure 60(b)(6) for extraordinary circumstances justifying relief and under Rule 60(d)(3) for fraud on the court. Marshak counters that Sheppard's motion is untimely and lacks evidence of fraud, further asserting that Sheppard's unclean hands from violating the injunction prevent him from obtaining relief. The court notes that Rule 60(b)(6) requires extraordinary circumstances and a reasonable time for filing, with equitable considerations like unclean hands influencing the decision. Sheppard's motion, filed over thirty years after the injunction, is deemed unreasonable, and his justifications for the delay are unconvincing. His claim of not learning about the Treadwell case until recently is insufficient, as is his assertion that he only needed to act when Marshak began enforcing the injunction. The court finds no persuasive evidence of hardship from the injunction, as Sheppard's claimed difficulties stem from his own violations. Consequently, Sheppard's arguments under Rule 60(b)(6) are unconvincing, and the motion to vacate the injunction is not supported.

Sheppard's argument under Rule 60(d)(3) is unconvincing, as this rule allows for vacating a judgment only in instances of fraud that compromises the integrity of the court's adjudicative process. Fraud on the court involves actions that undermine the court itself, typically perpetrated by officers of the court, which Sheppard fails to demonstrate. He merely claims that Marshak made fraudulent representations to the PTO that this Court relied on. Judge Pollack assessed the relationships between Marshak, George Treadwell, and Faye Treadwell, concluding that Marshak's statements about the Mark's rights were not materially misleading. Evidence suggested that Faye Treadwell's use of the Mark was primarily outside the U.S., and a jury verdict, though vacated, indicated Treadwell had abandoned the Mark. Prior rulings also validated Marshak's claims regarding the Mark. Sheppard's assertion that this case parallels Hazel-Atlas Glass Co. is unfounded, as that case involved a comprehensive scheme to deceive both the PTO and the court, a situation not mirrored in Sheppard's claims. His allegations pertain to the underlying case rather than constituting fraud upon the court, which is not permissible in a Rule 60 motion meant to relitigate. Consequently, Sheppard's motion to vacate the 1987 injunction is denied, with the Court noting that all other arguments are moot or without merit. The Clerk is instructed to close the case. Additionally, Sheppard mentioned a threat by Marshak to a concert promoter related to a concert in California, but did not clarify if this led to a cancellation.