Wine & Canvas Development, LLC, Anthony Scott, Tamara McCracken, and Donald McCracken, Plaintiffs-Appellants,
Christopher Muylle, Theodore Weisser, YN Canvas LLC d/b/a Art Uncorked, Art Uncorked, LLC, and Weisser Management Group, LLC, Defendants-Appellees.
November 9, 2016
from the United States District Court for the Southern
District of Indiana, Indianapolis Division. No. 11-cv-01598 -
Tanya Walton Pratt, Judge.
Bauer and Kanne, Circuit Judges, and Feinerman, District
FEINERMAN, DISTRICT JUDGE.
and Canvas Development, LLC, Anthony Scott, Tamara McCracken,
and Donald McCracken sued Christopher Muylle, Theodore
Weisser, YN Canvas CA, LLC, Art Uncorked LLC, and Weisser
Management Group LLC, bringing federal trademark and state
law claims. Muylle brought several counterclaims, including
one for abuse of process under Indiana law. Weisser
defaulted, and it appears that Weisser and Muylle were the
only members of the defendant LLCs, so practically speaking
the case ultimately amounted to Plaintiffs against Muylle.
Pretrial motions disposed of much of the case, and the jury
found for Muylle on Plaintiffs' trademark infringement
and false designation of origin claims and on Muylle's
abuse of process counterclaim. Plaintiffs appeal, and we
& Canvas is a business that specializes in hosting events
colloquially known as "painting nights." These are
social evenings where patrons, following a teacher's
instructions, create a painting while enjoying wine and other
adult beverages. Wine & Canvas operated locations in
Indianapolis, Bloomington, and Oklahoma City.
2008, Muylle befriended Scott, who was already acquainted
with Weisser. They discussed a franchise arrangement under
which Muylle and Weisser would move from Indiana to San
Francisco to open a Wine & Canvas operation there. Muylle
and Weisser signed a license agreement on behalf of their
entity, YN Canvas CA, LLC.
August 10, 2011, Muylle and Weisser launched their Wine &
Canvas location in San Francisco. Tamara McCracken and Scott
were present at the launch, and McCracken taught the first
class that day. McCracken also worked with Muylle and Weisser
to approve paintings they would use at their events.
Plaintiffs lent additional support by giving company email
addresses to Muylle and Weisser and by advertising the San
Francisco operation on the Wine & Canvas website.
soon arose over how the San Francisco operation would be
structured and what degree of ownership Plaintiffs would
hold. These disagreements continued without resolution.
Finally on November 18, 2011, Muylle and Weisser gave notice
that they were terminating the license agreement. At that
point, they changed the name of the business to "Art
Uncorked" and ceased using the Wine & Canvas name or
November 28, 2011, Plaintiffs filed a complaint in Indiana
state court alleging trademark infringement under the Lanham
Act, 15 U.S.C. § 1051 et seq., and other
claims. Defendants timely removed the suit to federal court,
and Muylle answered and filed several counterclaims. His
initial counterclaims invoked California franchise law, but
he later added federal trademark cancellation and Indiana law
abuse of process counterclaims.
the beginning, the proceedings were slow-moving, principally
due to the conduct of Plaintiffs and their attorneys.
Plaintiffs failed to serve written discovery responses on
their initial due date, March 20, 2013. They then failed to
meet the extended deadline of May 1, 2013, leading Muylle to
file a motion to compel, which was granted. After Plaintiffs
failed to respond by early June, the district court imposed
sanctions and ordered them to serve their responses by June
14, 2013, a deadline that later was extended to June 17.
Plaintiffs served woefully incomplete responses on June 17 at
11:55 p.m., and "final" responses at 4:10 a.m. the
next day. Muylle asserted that the "final"
responses were not only late, but also incomplete because
they did not itemize Plaintiffs' damages, and he moved
for further sanctions. Citing the responses' tardiness
and also their incompleteness, the magistrate judge
recommended sanctions in the amount of $2, 156, the costs to
Muylle of filing the sanctions motion, and the district court
adopted the recommendation. By the end of the case,
Plaintiffs had been sanctioned three times. Summarizing their
conduct, the district court observed that they had
"flooded the Court with filings ... and ... filed
numerous claims that the court has found to be without
merit." 2014 WL 4053928, at *15 (S.D. Ind. Aug. 15,
the district court dismissed the California franchise law
counterclaims, and both sides then moved for summary
judgment. The court granted Plaintiffs summary judgment on
Muylle's trademark cancellation counterclaim, but his
abuse of process counterclaim survived. The court granted
summary judgment to Muylle on most of Plaintiffs' claims,
including trademark dilution, sale of counterfeit items,
unfair competition, bad faith, tortious conduct, abuse of
process, breach of contract, fraud, and a claim for
compensation under the Indiana Crime Victims Act. The court
also granted partial summary judgment to Muylle on
Plaintiffs' trademark infringement claim, finding that
for any use through November 18, 2011, Plaintiffs had
impliedly consented to Muylle's using the marks.
three claims proceeded to trial: Plaintiffs' claims of
trademark infringement and false designation of origin (for
any use of the marks after November 18, 2011), and
Muylle's abuse of process counterclaim. The jury returned
a verdict for Muylle on all counts, rejecting Plaintiffs'
claims and awarding Muylle $ 270, 000 on his counterclaim.
After Plaintiffs filed their ...