H-D Michigan, LLC v. Hellenic Duty Free Shops S.A.

In the
United States Court of Appeals
For the Seventh Circuit
Nos. 11-3618, 11-3838 and 12-1280
H-D M ICHIGAN, LLC et al.,
Plaintiffs-Appellees,
v.
H ELLENIC D UTY F REE S HOPS S.A.,
Defendant-Appellant.
Appeals from the United States District Court
for the Eastern District of Wisconsin.
No. 2:11-cv-00742-LA—Lynn Adelman, Judge.
A RGUED M AY 24, 2012—D ECIDED S EPTEMBER 5, 2012
Before C UDAHY, K ANNE, and H AMILTON, Circuit Judges.
H AMILTON, Circuit Judge. These consolidated appeals
arise from an international trademark licensing dispute
between plaintiff Harley-Davidson Motor Company and
its former Greek licensee, defendant Hellenic Duty Free
Shops S.A. (“DFS”). DFS challenges a series of injunc-
tions issued by the United States District Court for the
Eastern District of Wisconsin. Appeal No. 11-3618 chal-
lenges the district court’s orders of November 7 and 17,
2 Nos. 11-3618, 11-3838 and 12-1280
2011 denying DFS’s motions to dissolve a temporary
restraining order entered on September 6, 2011. No. 11-
3838 challenges a preliminary injunction entered on
December 20, 2011. No. 12-1280 challenges a further
preliminary injunction issued February 7, 2012 addressing
DFS’s efforts to litigate this same dispute in the courts
of Greece.
Harley-Davidson made strong showings that DFS
was deliberately breaching a binding trademark
licensing agreement. Since Harley-Davidson learned of
the breaches and terminated the parties’ licensing agree-
ment, DFS has tried numerous legal twists and contor-
tions to try to avoid the legal consequences of its actions.
DFS’s primary argument is that the term in the licensing
agreement giving consent to personal jurisdiction in
the courts of Wisconsin is not binding on it, and DFS
raises numerous other challenges to the injunctions. The
district court correctly found that it had jurisdiction
over DFS and properly rejected its other arguments
and tactics. We affirm.
I. Factual and Procedural Background
A. The Licensing Agreement and the Breach
Harley-Davidson manufactures motorcycles and owns
famous trademarks that are popular on clothing and
other merchandise all over the world. For more than ten
years, Harley-Davidson had a licensing agreement with
a Greek company, Elmec Sport S.A., which was a subsid-
iary of defendant DFS. On January 1, 2010, Harley-
Nos. 11-3618, 11-3838 and 12-1280 3
Davidson and Elmec reaffirmed this relationship in a
trademark license agreement (the “Agreement”). Under
the Agreement, Harley-Davidson permitted Elmec to
use the “Harley-Davidson” and “Bar and Shield Logo”
trademarks, among others, for Harley-Davidson-approved
premium apparel products through Harley-Davidson-
approved European distribution channels. The Agree-
ment required Elmec to undergo a three-stage approval
process prior to its release of any Harley-Davidson-
branded products into the stream of commerce. Elmec
had to submit to Harley-Davidson for review and writ-
ten approval first all proposed concepts and artwork,
then pre-production samples, and finally production
samples.
Elmec sent Harley-Davidson a notice dated January 20,
2011 of “Merger of our Company with our parent com-
pany.” The notice informed Harley-Davidson that Elmec
and DFS would “from now on, trade as a single entity”
and that DFS “acts as full successor of Elmec.” In
Elmec’s words, “all the contracts that Elmec has entered
into remain valid,” and “this merger does not alter
the ownership structure and/or the management of our
company, and it shall not affect the business relation-
ships between our two companies.”
The Agreement gave Harley-Davidson the right to
terminate it if Elmec went through a merger. Harley-
Davidson did not not exercise that right. Instead, as it
had promised, DFS just stepped into Elmec’s shoes in
its relationship with Harley-Davidson. It submitted pre-
production samples to Harley-Davidson for approval,
4 Nos. 11-3618, 11-3838 and 12-1280
exhibited Harley-Davidson-branded products, took
orders, and met with Harley-Davidson to discuss
future branded products at an annual Harley-Davidson
dealer meeting. The same Harley-Davidson and DFS
personnel continued to work together, and Harley-
Davidson received DFS communications from e-mail
addresses ending “@elmec.gr.”
In April 2011, however, Harley-Davidson discovered
that DFS had sold unauthorized products bearing the
Harley-Davidson trademark to an unapproved German
retailer, Penny Markt. Harley-Davidson learned of DFS’s
action because other European dealers of its licensed
products complained, believing that the distribution of
sub-par products to unauthorized retailers would harm
the Harley-Davidson brand and their own businesses.
Harley-Davidson had not approved in writing any pre-
production samples or production samples of the Penny
Markt goods. In fact, DFS had not submitted any for
approval, and Harley-Davidson had previously rejected a
product concept and artwork for DFS’s “Essentials Col-
lection,” which included several proposed products that
were similar to Penny Markt goods. Nor had Harley-
Davidson approved Penny Markt as a retailer under
the Agreement. On April 14, 2011, Harley-Davidson
sent an e-mail to DFS saying that Harley-Davidson be-
lieved DFS was in “serious breach of your contract”
because of the Penny Markt sales, and that Harley-
Davidson was “suspending approval of any products
in concept, pre-production, or production phases.” DFS
responded in kind, stating that it had “no option but to
put on hold, as of today [April 15, 2011], all our dealings
Nos. 11-3618, 11-3838 and 12-1280 5
with you under the Agreement of January 1st 2010.”
On April 22, 2011, Harley-Davidson faxed DFS a letter
describing DFS’s breaches of the Agreement and ad-
vising DFS that it was exercising its right to terminate
the Agreement immediately.
Over the following months, Harley-Davidson at-
tempted to recover unpaid royalties from DFS and to
secure from DFS certain information required under
the Agreement. DFS refused these attempts. Even
though Harley-Davidson had suspended all DFS
product approvals and DFS had put “on hold” its own
dealings with Harley-Davidson, on July 22, 2011, DFS
submitted production samples for the then-upcoming
“Autumn/Winter 2011-2012” goods collection for Harley-
Davidson’s approval. Harley-Davidson did not review
the samples, reminding DFS that its April 22, 2011 termina-
tion prohibited DFS from “designing, manufacturing,
promoting, selling or distributing” any unauthorized
products bearing Harley-Davidson trademarks. On
July 28, 2011, DFS’s counsel advised Harley-Davidson
that it had “wrongfully repudiated the License Agree-
ment” and that DFS planned to “act unilaterally in ac-
cordance with its own views of the parties’ rights and
obligations.” That exchange lit the fuse of this litigation.
B. Temporary Restraining Order
Invoking the diversity jurisdiction of the federal courts
under 28 U.S.C. § 1332(a)(2), Harley-Davidson filed
this lawsuit in the Eastern District of Wisconsin for
breach of contract against DFS on August 5, 2011, and on
6 Nos. 11-3618, 11-3838 and 12-1280
August 12, 2011 moved for a temporary restraining
order. DFS received copies of all papers filed with the
district court through its U.S. counsel, but refused to
accept formal service of process through counsel. On
the day of the TRO hearing, the district court contacted
DFS’s U.S. attorney who had been speaking for DFS in
negotiations with Harley-Davidson and who has repre-
sented DFS in these appeals. The attorney told the court
that DFS did not wish to participate in the TRO hearing
on Friday, September 2, 2011. On the next business day,
Tuesday, September 6, 2011, the district court granted
the TRO against DFS, setting the bond at $10,000.
One week later, on September 13, 2011, Harley-Davidson
moved for an extension of the TRO beyond the initial 14-
day time period provided by Federal Rule of Civil Pro-
cedure 65(b)(2) until DFS could be served with process
under the Hague Convention and until a preliminary
injunction hearing could be held. Harley-Davidson
had initiated the process of effecting service on DFS
in August and had been informed that service would
likely take three to four months. The court granted Harley-
Davidson’s motion on September 19, extending the
TRO “until plaintiffs have effected service on defendant
pursuant to the Hague Convention.” H-D Michigan, LLC
v. Hellenic Duty Free Shops, S.A., 2011 WL 4368418, at *2
(E.D. Wis. Sept. 19, 2011). In fact, service had taken
only about a month. DFS had been served in Greece
on September 13, 2011, less than a week after the dis-
trict court issued the TRO. DFS did not appear in the
district court until October 4, 2011, when it filed its answer.
Nos. 11-3618, 11-3838 and 12-1280 7
On October 17, 2011, the district court held a telephonic
status conference. The minutes of that conference reflect
that the court offered to hold a hearing immediately on
the continuation of the TRO or the issuance of a prelimi-
nary injunction. DFS requested 45 to 60 days to conduct
discovery and to prepare for a hearing. The court granted
DFS’s request, scheduling the preliminary injunction
hearing for December 15, 2011. It also asked DFS to
submit any objections to the TRO and to submit evidence
on the appropriate size of the bond within 10 days. In
the meantime, though, the court ordered that the TRO
would remain in effect over DFS’s objection. Per the
court’s order, DFS moved to modify or vacate the tempo-
rary restraining order on October 27, 2011, arguing in
part that the bond then in place was inadequate and
that the district court did not have personal jurisdiction
over DFS. Its motion to vacate was denied, but the
court raised the amount of Harley-Davidson’s injunc-
tion bond to $1 million. It was raised again on Novem-
ber 17, 2011, to $1.8 million.
C. Preliminary Injunction
On December 20, 2011, after a hearing five days earlier,
the district court granted a preliminary injunction
against DFS. The preliminary injunction remains in effect
and prohibits DFS and “its employees, agents, partners,
officers, directors, owners, shareholders, principals,
subsidiaries, related companies, affiliates, joint ventures,
distributors, dealers, and all persons in active concert
or participation with any of them who receive actual
8 Nos. 11-3618, 11-3838 and 12-1280
notice by personal service or otherwise” from the fol-
lowing:
1. Manufacturing, assembling, distributing, promoting,
advertising and selling any products . . . and any
other materials bearing any of the Licensed Trade-
marks or variations thereof;
2. Using any of the Licensed Trademarks or variations
thereof in any manner on or in connection with
any products . . . ;
3. Representing by any means whatsoever, directly or
indirectly, that defendant, any products offered by
defendant, or any activities undertaken by defendant
are sponsored or licensed by plaintiffs, or are other-
wise associated or connected in any way with plain-
tiffs, or that the Agreement is still in effect;
4. Destroying, altering, secreting, transferring, or
otherwise disposing of . . . any artwork, products,
pre-production and production samples of
products, means for making products, advertise-
ments, promotional materials, sales and accounting
records, letters, emails, files, and documents
(whether on paper, in electronic format, or on any
other medium) relating to: (a) the Licensed Trade-
marks, (b) the Agreement, (c) the manufacture,
sales or promotion of products bearing the
Licensed Trademarks or variations thereof to or
by Penny Market [sic] Grocery stores, (d) the manu-
facture, sales, or promotion of products bearing
the Licensed Trademarks or variations thereof to
or by Real grocery stores, or (e) the claims and
Nos. 11-3618, 11-3838 and 12-1280 9
allegations asserted by plaintiffs in their complaint
in this action;
5. Assisting, aiding, or abetting any other person or
business entity in engaging in or performing any
of the activities referred to in paragraphs 1 through
4 above.
H-D Michigan, LLC v. Hellenic Duty Free Shops, S.A., 2011
WL 6385651, at *5 (E.D. Wis. Dec. 20, 2011).
D. DFS’s Greek Lawsuit and the Anti-Suit Injunctions
In the meantime, DFS had filed a lawsuit against Harley-
Davidson in Greece on November 15, 2011. While
the district court’s TRO was in place, and before the
preliminary injunction was entered, DFS asked the Greek
court to issue an injunction against Harley-Davidson
that would (a) allow DFS to distribute freely the Autumn-
Winter 2012 Goods that Harley-Davidson had refused
to approve and (b) prohibit Harley-Davidson from dis-
puting DFS’s status as an authorized Harley-Davidson
licensee. The record before us shows that DFS did not
inform the U.S. district court or Harley-Davidson of
the Greek lawsuit, nor did DFS tell the Greek court
about the existence of the U.S. action or the TRO that
conflicted directly with the relief it was seeking in
the Greek lawsuit. Following an ex parte hearing
on December 2, 2011, the Greek court issued a provisional
order against Harley-Davidson permitting DFS to distrib-
ute the disputed Autumn-Winter 2012 goods. Harley-
Davidson did not learn of DFS’s Greek action until it was
10 Nos. 11-3618, 11-3838 and 12-1280
served with the provisional order on January 18, 2012.
Neither DFS nor its counsel advised the district court,
Harley-Davidson, or its counsel of the Greek action despite
many opportunities to do so between November 15, 2011
and January 18, 2012.1
On January 24, 2012, Harley-Davidson filed in the
district court an “Emergency Motion for Preliminary Anti-
Suit Injunction” seeking to compel DFS to withdraw its
Greek lawsuit. Harley-Davidson also brought related
petitions in Greece. On January 25 and 27, 2012, Harley-
Davidson petitioned the Greek court: (a) to enforce the
U.S. district court’s December 20, 2011 injunction;
and (b) to revoke the Greek court’s injunction against
Harley-Davidson that DFS had obtained ex parte. Harley-
Davidson informed DFS’s U.S. counsel of its Greek peti-
tions by e-mail on January 30, 2012 after DFS had filed
its opposition to Harley-Davidson’s anti-suit injunction
motion. Harley-Davidson informed the district court of
its Greek actions on February 2, 2012 in its reply brief.
1
DFS insists that it informed Harley-Davidson of the action by
cable on November 25, 2011, and implies that the Greek court
would not have issued a restraining order against Harley-
Davidson unless it was reasonably assured that Harley-
Davidson had been properly summoned. The parties apparently
are attempting to verify what happened to the cable. For
purposes of these appeals, whether Harley-Davidson received
the November 25 cable is not important. DFS had many oppor-
tunities, both in and out of court, to inform Harley-Davidson
and the district court of the DFS Greek lawsuit and repeatedly
chose not to do so.
Nos. 11-3618, 11-3838 and 12-1280 11
On February 7, 2012, the district court granted an anti-
suit injunction motion. Its opinion described the DFS
Greek action as “a blatant attempt by defendant to
relitigate issues that I have already decided” and described
Harley-Davidson’s Greek action as “Plaintiff’s effort
to dismiss the parallel lawsuit by working through the
Greek courts.” H-D Michigan, LLC v. Hellenic Duty Free
Shops, S.A., 2012 WL 404895, at *4 (E.D. Wis. Feb. 7, 2012).
Its order on Harley-Davidson’s preliminary anti-suit
injunction motion, entered separately, enjoined DFS from:
1. further prosecuting, litigating and/or proceeding
by any means whatsoever with the Provisional
Measure Procedure No. 141350 before the One-
Member First Instance Court of Athens titled
Duty Free Shops Society Anonyme for the Exploitation
of Duty Free Shops and Industrial, Manufacturing,
Technical and Commercial Company S.A. v. Harley-
Davidson Motor Company, Inc. and any associated
proceedings;
2. further prosecuting, litigating and/or proceeding
by any means whatsoever with any actions, pro-
ceedings or lawsuits before any court or agency
in any country or territory outside of the United
States that contradict, impair, or otherwise affect
this Court’s rulings, including the December 20,
2011 preliminary injunction order, and/or this
Court’s jurisdiction to adjudicate the present action;
3. from filing or otherwise initiating any other
actions . . . before any court or agency in any
country or territory outside of the United States that
12 Nos. 11-3618, 11-3838 and 12-1280
contradict, impair, or otherwise affect this Court’s
rulings, including the December 20, 2011 preliminary
injunction order and/or this Court’s jurisdiction to
adjudicate the present action.
Dkt. 97 at 3-4.
Meanwhile, Harley-Davidson’s Greek petitions were
scheduled to be heard in the First Instance Court of Athens
on February 17, 2012. On February 10, DFS filed in our
court a motion to stay the district court’s anti-suit injunc-
tion order pending appeal. We denied the motion. DFS
then petitioned the district court for a stay, con-
tending that a stay “would not interfere at all with
Harley-Davidson’s right and ability to argue to the First
Instance Court that it should ‘recognize’ and enforce, in
Greece, a provisional non-final injunctive order of this
court notwithstanding DFS’s pending appeals and as
yet unlitigated jurisdictional and other defenses to
liability or specific performance as a remedy.”
DFS’s motion to stay was still pending in the U.S. district
court when the hearing on the Harley-Davidson Greek
petitions went forward in Greece. DFS appeared and
actively opposed Harley-Davidson’s petitions. In the
Greek court, it contested both the jurisdiction and the
substance of the U.S. district court’s December 20,
2011 preliminary injunction. On February 20, 2012, the
Greek court granted Harley-Davidson’s motion for a
temporary order enforcing the U.S. district court’s Decem-
ber 20 preliminary injunction and revoked its own pro-
visional order in the DFS Greek action. The Harley-
Davidson Greek petitions remain pending in the
Nos. 11-3618, 11-3838 and 12-1280 13
First Instance Court of Athens, with a final hearing sched-
uled for September 21, 2012.
Apparently unaware that the Greek court had granted
Harley-Davidson’s motion for a temporary order and
revoked its prior order in favor of DFS two days earlier,
on February 22, 2012, the district court denied DFS’s
motion to stay the February 7 anti-suit injunction. The
district court found that DFS had failed to demonstrate
that the anti-suit injunction could harm international
relations between the United States and Greece or that
DFS could be irreparably harmed. “Regardless of what
the Greek court does, defendant is bound by the pre-
liminary injunction because defendant is a party to
this lawsuit and is subject to personal jurisdiction in
this court.” The court also noted: “While the injunction
does prohibit defendant from opposing plaintiff’s efforts to
enforce in Greece the preliminary injunction I issued on
December 20, 2011, these efforts cannot cause meaningful
harm to defendant.” Dkt. 113 at 2 (emphasis added).
II. Analysis
DFS mounts several arguments in its appeals of the
temporary restraining order, the preliminary injunction,
and the anti-suit injunction. Its principal argument is
that the district court in Wisconsin had no personal
jurisdiction over DFS, which had not signed the Harley-
Davidson/Elmec Agreement in which Elmec had agreed
to jurisdiction and venue in Wisconsin. We address this
issue first and agree with the district court that DFS
became a party to the Agreement through its merger
14 Nos. 11-3618, 11-3838 and 12-1280
with Elmec. We then turn to DFS’s narrower challenges
to the TRO, then the preliminary injunction, and
finally the anti-suit injunctions. We affirm all of the
district court’s orders.
A. Personal Jurisdiction
DFS’s broadest challenge is that the U.S. district court
in Wisconsin had no personal jurisdiction over it and
thus could not issue binding injunctions. DFS is a Greek
corporation with its principal place of business in Attica,
Greece. It has no offices, employees, representatives, or
property in Wisconsin, and it is not registered to do
business in Wisconsin. It does not market or sell any
goods or services in Wisconsin. But in January 2011,
DFS merged with its subsidiary Elmec, with DFS as the
surviving entity. Under the merger, Elmec’s assets
became the assets of DFS. One of those assets was the
Harley-Davidson/Elmec Agreement, with its attendant
rights and obligations. Section 16.2 of the Agreement
provided that the federal and state courts in Wisconsin
were to have exclusive jurisdiction over all disputes
“arising out of or relating to this Agreement,” and that
Elmec explicitly consented to personal jurisdiction in
Wisconsin with respect to “disputes between the par-
ties” to the Agreement. The issue is whether, when
Elmec and DFS merged, DFS assumed and can be bound
by Elmec’s consent to jurisdiction in Wisconsin.
In licensing agreements for trademarks and other
intellectual property, the licensor generally wants to
maintain control of the intellectual property. One impor-
Nos. 11-3618, 11-3838 and 12-1280 15
tant means for doing so are restrictions on the licensee’s
ability to transfer or assign its rights under the license
to third parties who may be unknown or even hostile to
the licensor. The Harley-Davidson/Elmec Agreement
contained several such provisions. We focus first on
the language that addressed most specifically the con-
sequences of a merger or other change of control of
the licensee. Section 10.1(c), which we call the merger
provision, said in relevant part:
If any of the following Triggering Events occur,
[Harley-Davidson] shall have the option, in its sole and
exclusive discretion, to immediately terminate this
Agreement by sending written notice of termination to
Licensee . . . :
(i) Any merger, consolidation, acquisition, change of
ownership, control or management involving Licensee
occurs; or
(ii) Any of the principal assets of Licensee that are
required for the conduct of its business are trans-
ferred, by operation of law, merger, consolidation,
issuance or re-issuance of shares, or otherwise.
(Emphases added.) Harley-Davidson received notice of
the DFS-Elmec merger and did not exercise its option to
terminate the Agreement. Under section 10.1(c), the
Agreement remained in effect with DFS as licensee
with all of Elmec’s rights and obligations.
This conclusion, based on the plain language of
section 10.1(c), is consistent with DFS’s own words and
actions after the merger. Upon the event of the merger,
16 Nos. 11-3618, 11-3838 and 12-1280
Elmec assured Harley-Davidson by notice dated January
20, 2011, that, “legally, HELLENIC DUTY FREE SHOPS
S.A. — FOLLI FOLLIE GROUP acts as full successor
of Elmec Sport S.A. Therefore, all the contracts Elmec
has entered into remain valid.” Although Elmec asked
Harley-Davidson to acknowledge the merger, Harley-
Davidson did not respond. It certainly did not exercise
its option under section 10.1(c) to terminate the agree-
ment. After the merger, neither Harley-Davidson nor
DFS made any effort to amend the Agreement or its
consent-to-jurisdiction clause. DFS itself insisted that
the Agreement was still effective and binding when its
counsel wrote a July 28, 2011 letter asserting that DFS
could enforce the Harley-Davidson/Elmec “License Agree-
ment.” (“You will appreciate that [DFS] considers that
[Harley-Davidson] has wrongfully repudiated the License
Agreement and is in no position to be making any de-
mands on DFS whatsoever . . . . DFS will act unilaterally
in accordance with its own views of the parties’ rights
and obligations.”)2 Based on these facts, Harley-
Davidson argued, and the district court found, that the
effect of the DFS-Elmec merger was to bind DFS to
the terms of the Agreement, including Elmec’s consent
to jurisdiction in Wisconsin.
2
The author of the letter was Mr. Dabney, who argued the case
before this court. His assertion at oral argument that his refer-
ence to the “License Agreement” in the July 28 letter was to
some other agreement was neither credible nor in keeping
with counsel’s professional duty of candor to the court.
Nos. 11-3618, 11-3838 and 12-1280 17
To avoid this application of the merger provision,
consistent with the parties’ actions, DFS has argued
that the Agreement was completely voided by the DFS-
Elmec merger and that the parties’ relationship after
the merger was not governed by any written agreement.
The theory in the litigation, which is not consistent
with any of DFS’s earlier actions or statements, including
its counsel’s letter of July 28, 2011, is that the effect of the
DFS-Elmec merger was governed not by the merger provi-
sion in section 10.1(c) but by a different, broader pro-
vision, section 14, which provided:
This Agreement and all rights and obligations here-
under are personal to Licensee and may not be as-
signed, sublicensed, encumbered, or otherwise trans-
ferred, in whole or in part, by Licensee without
the prior written consent of Licensor, which consent
shall be in Licensor’s sole and exclusive discretion. . . .
Any attempt by Licensee to do any of the foregoing
shall be void ab initio and shall constitute a
material breach of this Agreement.
Citing Menenberg v. Carl R. Sams Realty Co., 59 N.W.2d 125,
127 (Mich. 1953), DFS contends that Elmec’s rights and
obligations under the Agreement were personal to
Elmec, and that under applicable law, personal
contracts and obligations cannot be transferred to a
third party. The theory is that when Elmec and DFS
merged without prior written consent of Harley-
Davidson under section 14, the merger voided the Agree-
ment altogether because the DFS-Elmec merger fell
under section 14’s broad and comprehensive ban
of “assign[ments]” and “other[ ] transfer[s].”
18 Nos. 11-3618, 11-3838 and 12-1280
In support of its position, DFS relies on a handful of
distinguishable cases and an affidavit of University of
Michigan Law Professor James J. White, who has opined
that the DFS-Elmec Agreement “does not impose any
obligations on DFS and does not obligate DFS to litigate
any claims in Wisconsin.” We disagree.
Because this issue turns on a question of contract inter-
pretation, our review is de novo. See Digitech Computer,
Inc. v. Trans-Care, Inc., 646 F.3d 413, 417 (7th Cir. 2011).
Accordingly, we examine the language of the Agreement
and interpret its terms under well-established principles
of contract construction under Michigan law. Under
Michigan law, the goal of contract interpretation is to read
the document as a whole and to apply the plain language
used to honor the intent of the parties. See Dobbelaere v.
Auto-Owners Ins. Co., 740 N.W.2d 503, 505 (Mich. App.
2007). We must enforce the clear and unambiguous lan-
guage of a contract as it is written. See Frankenmuth
Mut. Ins. Co. v. Masters, 595 N.W.2d 832, 837 (Mich. 1999).
We agree with the district court and find under
Michigan law that the general provisions of section 14
do not control where the more specific terms of sec-
tion 10.1(c) apply to the merger by Elmec. DFS is bound
by the Agreement and is subject to personal jurisdiction
in Wisconsin under the Agreement’s clause consenting
to jurisdiction in Wisconsin.3
3
In addition to finding section 10.1(c) controls, we also find
DFS precluded by equitable principles of waiver and estoppel
(continued...)
Nos. 11-3618, 11-3838 and 12-1280 19
The governing principles of contract interpretation
are familiar: that the more specific provision governs
where there is an arguable conflict with a more general
provision, see Royal Property Group, LLC v. Prime Ins.
Syndicate, Inc., 706 N.W.2d 426, 434 (Mich. App.
2005), citing Sobel v. Steelcraft Piston Ring Sales, Inc., 292
N.W. 863, 867 (Mich. 1940); 11 Williston on Contracts
§ 32:10 (4th ed.), and that the contract should be inter-
preted to avoid rendering any provision superfluous, see
Klapp v. United Ins. Group Agency, Inc., 663 N.W.2d 447,
453 (Mich. 2003); Royal Property Group, 706 N.W.2d at 432
(citing Klapp).
Reading the Harley-Davidson Agreement with Elmec
as a whole, section 10.1(c) provided a clear exception — for
mergers — to the more general language of section 14.
Section 10.1(c) gave Harley-Davidson the option to termi-
nate the Agreement in the event of a “merger, consolida-
tion, acquisition, or change of ownership, control, or
management.” Section 14 did not refer to mergers.
Instead, it generally stated that rights and obligations
under the Agreement “may not be assigned, sublicensed,
3
(...continued)
from arguing that its merger with Elmec triggered the anti-
assignment clause. After the merger, DFS told Harley-Davidson
that the Agreement remained in effect, and Harley-Davidson
could reasonably rely on that assurance as long as Harley-
Davidson did not exercise its option to terminate. Moreover,
DFS acted so as to take advantage of the license granted under
the Agreement but, in litigation, is attempting to disavow
its corresponding obligations under the same Agreement.
20 Nos. 11-3618, 11-3838 and 12-1280
encumbered or otherwise transferred . . . without prior
written consent of Licensor.” Simply put, section 10.1(c)
addressed specifically the effects of a corporate merger.
Section 14 did not. Therefore, when Elmec merged into
DFS, section 10.1(c) of the Agreement governed the parties’
rights and obligations. Section 14 did not.
When DFS and Elmec joined, the “Merging Announce-
ment” informed Harley-Davidson that the “merging
procedures” between Elmec and DFS were complete and
that “this merger does not alter the ownership structure
and/or the management of our company, and it shall not
affect the business relationships between our two compa-
nies.” After Harley-Davidson received notice of the merger
announcement, it did not exercise its option to terminate
the agreement pursuant to section 10.1(c). Consistent with
DFS’s own words and actions at the time, the Agreement
therefore remained in effect after the merger and was
binding on DFS. Our conclusion is consistent with the
Agreement as a whole, renders no provision of the Agree-
ment superfluous, and is consistent with Michigan law. See
Mich. Comp. Laws § 450.1724(1)(b) (“the title to all real
estate and other property and rights owned by each
corporation party to the merger are vested in the surviving
corporation without reversion or impairment.”).
These principles rebut DFS’s arguments. DFS would
make the general provision for attempted assignments
and transfers of the license override the more specific
provision for mergers by the licensee. DFS would also
render section 10.1(c) superfluous, for its more specific
provisions would have no effect if the general provi-
Nos. 11-3618, 11-3838 and 12-1280 21
sions of section 14 were to govern. DFS runs into
another problem. Contrary to DFS’s argument, section 14
does not mean that an attempt by Elmec to transfer
or assign its rights and duties renders the underlying
Agreement void as a whole. Section 14 provides
instead that an attempted transfer or assignment, done
without Harley-Davidson’s permission, would be void
ab initio — not that the underlying Agreement itself
would be void. The attempted transfer would be void
but would leave the Agreement in place, so that even
if section 14 were triggered, Elmec would remain a party
to the Agreement, and would remain subject to its
duties under the Agreement. Elmec is now DFS, so DFS
would be bound in Elmec’s stead.
The license granted by the Agreement was, at every
turn, Harley-Davidson’s to control, define, and limit.
See Agr. § 4.2(a) (requiring licensee to go through a three-
stage approval process and obtain Harley-Davidson’s
written approval at each stage before releasing any Harley-
Davidson-branded products under the Agreement);
Agr. Exhibit A (list of Harley-Davidson-approved dis-
tribution channels); Agr. § 1.3 (requiring licensee to
obtain Harley-Davidson’s written approval for any dis-
tribution channels other than those listed in Exhibit A).
Under section 10.1(c), Harley-Davidson retained this
control in the event that licensee Elmec merged with
another entity.
DFS’s contention that section 14 trumped section 10.1(c)
would improbably shift the contractual balance of
22 Nos. 11-3618, 11-3838 and 12-1280
power out of Harley-Davidson’s control and into DFS-
Elmec’s. Harley-Davidson would no longer have the
option, in its sole discretion, to terminate in the event of
a merger — an option that is clearly set forth by
section 10.1(c). Instead, DFS’s reading would give
licensee Elmec the unilateral power to terminate the
Agreement simply by redefining itself as another entity,
yet also, improbably, continuing to enjoy the trademark
license granted in the supposedly void Agreement.
(Here Elmec accomplished that result through merger
with DFS, but its argument does not foreclose the possi-
bility that it could have unilaterally scuttled the con-
tract based on a mere change in management, also a
“triggering event” listed in section 10.1(c).) No other
provision of the Agreement gave that level of control
to DFS-Elmec.
Contrary to DFS’s argument, our finding that section
10.1(c) controlled corporate mergers does not make
the license granted by Harley-Davidson any less “per-
sonal” — a contractual understanding that must itself
be read in the context of the entire Agreement. The case
on which DFS relies — Menenberg v. Carl R. Sams Realty
Co., 59 N.W.2d 125, 127 (Mich. 1953) — applies to the
dissolution of a partnership and is not apposite to a
corporate merger. See id. (discussing “rule that the dis-
solution of a real estate brokerage partnership
terminates its authority to sell real estate which had been
placed in its hands for that purpose”). Professor White
also puts forth this theory, but the case on which he
relies is similarly distinguishable, and inapplicable.
Nos. 11-3618, 11-3838 and 12-1280 23
See White Aff. at 3, citing Detroit Postage Stamp Service
Co. v. Schermack, 146 N.W. 144, 147 (Mich. 1914) (contract
by which defendants granted plaintiff’s assignor an
exclusive agency for the sale of merchandise involved
a personal relationship that could not be assigned
without defendant’s consent; assignee never undertook
obligations under the contract and therefore could not
enforce it). This argument is not persuasive, is without
meaningful case support and runs contrary to the princi-
ples of contract interpretation discussed above. However
personal Elmec’s rights and obligations were under the
Agreement, its merger into DFS did not upend the Agree-
ment. The merger merely gave Harley-Davidson an option
to terminate, which it did not exercise. The Agreement
remained in effect, and the surviving entity from the
merger, DFS, became the licensee under it — just as DFS
said at the time of the merger — and thus became subject
to jurisdiction in Wisconsin.
DFS relies on a number of cases interpreting provi-
sions similar to the Agreement’s section 14 “transfer”
provision. None of these cases involved a contract with
a more specific provision like the merger provision in
the Harley-Davidson Agreement with Elmec, and in
none of these cases was a licensee permitted to avoid
its obligations by merging with another entity. In sum,
DFS cites no relevant authority to support its extra-
ordinary position that in the face of a generalized “assign-
ment” provision and a specific “merger” position, the
general assignment provision would control the parties’
rights and obligations in the event of a corporate
24 Nos. 11-3618, 11-3838 and 12-1280
merger, such that a licensee could avoid its contractual
obligations through a corporate merger.4
4
We need not address them all individually, but DFS’s host
of inapposite authority includes Pro-Edge L.P. v. Gue, 419 F.
Supp.2d 1064, 1082-85 (N.D. Iowa 2006) (employment agree-
ment containing covenant not to compete was not excluded
from asset transfer in corporate restructuring; contract did not
define “assignment” or provide an exception in the event of
a change in corporate structure); Freeman Mgmt. Corp. v. Shurgard
Storage Ctrs., Inc., 2007 WL 1541877, at *5 (M.D. Tenn. May 23,
2007) (anti-assignment clause in joint venture agreement
prevented transfer of agreement to surviving entity after
merger; contract’s anti-transfer provision prohibited transfers
voluntarily or by “operation of law,” and did not define
transfer or otherwise provide an exception for corporate
mergers); Laforest v. Honeywell Int’l, Inc., 2004 WL 1925490, at *5-
6 (W.D.N.Y. Aug. 27, 2004) (party’s contractual obligations
could not have been assigned because anti-assignment clause
required prior written consent to transfer and no prior con-
sent was obtained; contract did not contain merger provision);
Parks v. CAI Wireless Sys., Inc., 85 F. Supp. 2d 549, 554-55 (D.
Md. 2000) (denying defendants’ motion for summary judgment
on claims of constructive fraud and breach of contract; contract
did not define assignment or transfer or exempt corporate
mergers, so defendants’ corporate merger triggered assignment
clause requiring plaintiff’s interest in joint venture to be sold
or assigned on identical terms); SQL Solutions, Inc. v. Oracle
Corp., 1991 WL 626458, at *3-6 (N.D. Cal. Dec. 18, 1991) (consis-
tent with federal copyright law, anti-assignment clause prohib-
ited transfer of non-exclusive copyright license to surviving
entity after corporate merger; contract did not define assign-
(continued...)
Nos. 11-3618, 11-3838 and 12-1280 25
DFS relies most heavily on two federal court decisions.
In Cincom Sys., Inc. v. Novelis Corp., 581 F.3d 431 (6th Cir.
2009), the Sixth Circuit examined a software license
agreement that included a general provision that the
licensee could “not transfer its rights or obligations
under this Agreement without the prior written
approval of [licensor] Cincom.” Id. at 434. The Sixth
Circuit affirmed the district court’s conclusion that the
licensee’s merger was a violation of the contract’s anti-
assignment provision. The court wrote: “the plain text
of the license is clear. No transfers are permissible
without express written approval.” Id. at 437. If we
were interpreting section 14 of the Harley-Davidson/
Elmec Agreement in a vacuum, Cincom would tell us
that an attempted transfer of the license from Elmec to
DFS would be void, but the contract in Cincom did not
contain a separate merger provision comparable to
section 10.1(c) in the Harley-Davidson/Elmec Agree-
ment. Accordingly, Cincom offers little direct guidance.
(The Cincom court affirmed summary judgment in favor
of the copyright owner holding that the result of the
attempted transfer of license was that the license was
void and the defendant had infringed the copyright.)
4
(...continued)
ment or contain a provision specifically governing merger);
Nicholas M. Salgo Assocs. v. Continental Illinois Props., 532 F. Supp.
279, 282-83 (D.D.C. 1981) (partial summary judgment granted
in favor of plaintiff based on its argument that partner’s
merger without plaintiff’s consent violated anti-assignment
clause in partnership agreement; partnership agreement
did not except mergers).
26 Nos. 11-3618, 11-3838 and 12-1280
Similarly, Hy King Associates, Inc. v. Versatech Manu-
facturing Industries, Inc., 826 F. Supp. 231 (E.D. Mich.
1993), involved a contract that prohibited the “as-
sign[ment] or transfer [of] this agreement or any rights
or obligations hereunder except with the prior
written consent” of Versatech. Id. at 233. King signed
the contract as an individual but later incorporated his
sales business. The question was whether the incorpora-
tion was a triggering event under the assignment provi-
sion. The court held that it was, finding that under the
plain language of the agreement, Versatech’s written
consent was a condition precedent to a valid assign-
ment, so there could be no contractual relationship be-
tween the parties. Id. at 238-39. Like Cincom, Hy King
interpreted a contract that included a general assignment
clause but not a more specific merger clause. These
cases therefore offer no useful guidance for interpreting
the Harley-Davidson/Elmec Agreement in which the
parties included a provision separate from the anti-assign-
ment provision that explicitly dealt with mergers.
Although dicta, language found in PPG Industries, Inc. v.
Guardian Industries Corp., 597 F.2d 1090 (6th Cir. 1979),
provides more relevant guidance. PPG involved two
glass fabrication companies that had developed a new
industrial process for shaping glass for various com-
mercial uses. PPG granted a patent license that was
personal to the licensee and “non-assignable except
with the consent of PPG first obtained in writing.” Id.
at 1092. The licensee (Permaglass) then merged with
Guardian, a corporation that manufactured automobile
windshields. If Ohio state law had applied, PPG’s
Nos. 11-3618, 11-3838 and 12-1280 27
licenses would have automatically transferred from
Permaglass to Guardian as part of the merger. The
Sixth Circuit, however, concluded that federal law gov-
erned the assignment of a patent license and that a
license is presumed to be non-assignable and non-trans-
ferable “in the absence of express provisions to the con-
trary.” Id. at 1095. “If the parties had intended an
exception in the event of a merger, it would have been
a simple matter to have so provided in the agreement.”
Id., citing, e.g., Packard Instrument Co. v. ANS, Inc., 416
F.2d 943, 944 n.1 (2d Cir. 1969) (license agreement
provided that rights thereunder could not be transferred
or assigned “except . . . if the entire ownership and busi-
ness of ANS is transferred by sale, merger, or consolida-
tion”); Freeman v. Seiberling Rubber Co., 72 F.2d 124, 125-
26 (6th Cir. 1934) (license was not assignable except
with the entire business and good will of the licensee).
The parties in PPG did not expressly provide for merger,
so the anti-assignment clause governed. Harley-Davidson
and Elmec, on the other hand, did expressly provide
for their respective rights and obligations in the event of
a merger, and that provision, section 10.1(c), governs
the outcome and secured the Wisconsin court’s juris-
diction over DFS.
DFS assumed the Agreement as an asset after the DFS-
Elmec merger. That was made plain to Harley-
Davidson when DFS confirmed that “all the contracts
Elmec has entered into remain valid” and that “the
merger does not alter the ownership structure and/or the
management of our company, and it shall not affect
the business relationship between our two companies.”
28 Nos. 11-3618, 11-3838 and 12-1280
DFS cannot now escape its obligations by redefining
that transaction as a “transfer” or “assignment” instead
of what it was, a corporate merger that, under the terms
of the Agreement, had no impact on the Agreement
without Harley-Davidson’s written objection. When
Harley-Davidson did not object to the merger, DFS as-
sumed Elmec’s rights and obligations under the
contract, including its consent to personal jurisdiction in
Wisconsin. The district court had and still has per-
sonal jurisdiction over DFS.
B. The Temporary Restraining Order
With personal jurisdiction secure, we turn to DFS’s
attacks on the merits of the district court’s orders.
DFS appeals several aspects of the temporary re-
straining order that was first issued by the district court
on September 6, 2011 and then modified on November 7
and 17. Although the TRO was superseded by a prelimi-
nary injunction entered on December 20, 2011, these
issues remain ripe for review. See Groupo Mexicano
de Desarrollo, S.A. v. Alliance Bond Fund, Inc., 527 U.S.
308, 313-18 (1999) (plaintiffs’ eventual victory on the
merits did not render moot the question of whether the
preliminary injunction had properly issued; provisional
remedy was not necessarily justified by defendant’s
contractual liability); American Can Co. v. Mansukhani,
742 F.2d 314, 320-21 (7th Cir. 1984) (validity of TRO
reviewed after it had been superseded by later prelim-
inary injunction; TRO had caused injury to defendant
prior to preliminary injunction hearing). On appeal we
Nos. 11-3618, 11-3838 and 12-1280 29
“review the [district] court’s legal conclusions de novo,
its findings of fact for clear error, and its balancing of
the injunction factors for an abuse of discretion.” Ezell v.
City of Chicago, 651 F.3d 684, 694 (7th Cir. 2011); Christian
Legal Society v. Walker, 453 F.3d 853, 859 (7th Cir. 2006).
We address DFS’s arguments against the TRO in the
order in which they were presented.
1. Service of Process
DFS’s first argument is preposterous. It argues that the
district court erred by issuing the TRO prior to formal
service of process or the appearance of DFS’s counsel. The
argument is refuted by the plain language of Rule 65,
which permits the issuance of a preliminary injunction
“only on notice,” or the issuance of a temporary
restraining order in some cases without “written or oral
notice to the adverse party or its attorney.” Fed. R. Civ. P.
65(a), (b)(1). The case on which DFS relies — Murphy
Brothers, Inc. v. Michetti Pipe Stringing, Inc., 526 U.S.
344, 350-51 (1999) — dealt with deadlines for removal
to federal court, not TROs. It has nothing to do with
Rule 65. In fact, DFS and its counsel had actual notice of
the hearing on Harley-Davidson’s motion for a TRO
and chose not to participate. That was their right, but
their choice did not deprive the court of the power to
issue a TRO. Moreover, because formal service of
process under the Hague Convention or other provi-
sions of law can take months, acceptance of DFS’s argu-
ment would have the unfortunate effect of immunizing
most foreign defendants from needed emergency injunc-
30 Nos. 11-3618, 11-3838 and 12-1280
tive relief. There is a reason Rule 65 allows emergency
injunctive relief before service of process, and this
case provides a good example.
2. Parties Bound
Next, DFS argues that the district court’s temporary
restraining order was impermissibly broad, going
beyond Rule 65(d)(2)’s directive that the order may
bind only parties, the parties’ officers, agents, servants,
employees, and attorneys, and “other persons who are
in active concert or participation with [the foregoing
persons].” By its terms, the TRO bound not only DFS
and its various categories of agents, but also DFS’s “dis-
tributors, dealers, and all persons in active concert or
participation with any of them.” DFS’s argument runs
headlong into our precedent, which holds that the
district court has broad authority under Rule 65 to
enjoin third parties who receive appropriate notice of
the court’s injunctive order. “Nonparties who reside
outside the territorial jurisdiction of a district court may
be subject to that court’s jurisdiction if, with actual
notice of the court’s order, they actively aid and abet
a party in violating that order. This is so despite the
absence of other contacts with the forum. Jurisdiction
over persons who knowingly violate a court’s injunctive
order, even those without any other contact with the
forum, is necessary to the proper enforcement and super-
vision of a court’s injunctive authority and offends
no precept of due process.” SEC v. Homa, 514 F.3d 661, 674-
75 (7th Cir. 2008) (internal quotations omitted). Given
Nos. 11-3618, 11-3838 and 12-1280 31
the district court’s familiarity with these parties and
their dispute, we defer to its discretionary judgment
that the broad language it used was necessary to give
effect to its order. Should any non-party believe that it
has been enjoined improperly, it is free to seek a modi-
fication or clarification from the district court, which
might be able to consider whether, for example, a dealer
or distributor would qualify as an agent of DFS. At
this juncture, however, and without any showing that
the rights of any non-party have been infringed, DFS’s
argument fails.
3. “Reasonable Detail”
An order granting a preliminary injunction or re-
straining order must “describe in reasonable detail — and
not by referring to the complaint or other document — the
act or acts restrained or required.” Fed. R. Civ. P.
65(d)(1)(C). DFS argues that the TRO violated this pro-
vision by improperly describing the enjoined acts “by
reference to a definition of the capitalized term
‘Licensed [Trademarks]’ as it appeared in the [Harley-
Davidson]/Elmec Agreement,” which was under seal at
the time.5 But the injunction must also be broad enough
to be effective. The appropriate scope of the injunction
5
DFS’s brief refers to the phrase “Licensed Products” instead
of “Licensed Trademarks.” Because the court’s TRO did not use
or define the phrase “Licensed Products,” we presume that
DFS meant “Licensed Trademarks,” which is defined by the
district court in the TRO. For our purposes the particular
term is not important.
32 Nos. 11-3618, 11-3838 and 12-1280
is best left to the district court’s sound discretion,
because the district court is in the best position to weigh
these interests. See Russian Media Group, LLC v. Cable
America, Inc., 598 F.3d 302, 307 (7th Cir. 2010) (injunc-
tion that potentially enjoined legal conduct upheld;
defendant had demonstrated proclivity for unlawful
conduct and for violating court’s orders, warranting a
broadly-worded order) (collecting cases). Although the
district court’s TRO did not explicitly define the term
“Licensed Trademarks,” the term’s reference to Harley-
Davidson trademarks is sufficiently plain from the docu-
ment. DFS does not argue that it suffered from any con-
fusion or uncertainty concerning the definition of “Li-
censed Trademarks” or any other aspect of the district
court’s language. Nor has DFS asked the district court
to modify or clarify the order. See, e.g., Russian Media
Group, 598 F.3d at 308 (inviting defendants to seek modifi-
cation of injunction from district court if they desired
to engage in legal conduct that would otherwise
violate the order). Accordingly, we find that the district
court’s TRO satisfied Rule 65(d)(1)(C)’s requirement that
it “describe in reasonable detail . . . the act or acts re-
strained,” and that the broad scope of the order was
not an abuse of the district court’s discretion.
4. 28-Day Limit
DFS next challenges the district court’s extensions of
its TRO. Harley-Davidson first moved for a TRO on
August 12, 2011. DFS refused to accept service. When
its counsel was contacted by the court on September 2,
Nos. 11-3618, 11-3838 and 12-1280 33
the day of the TRO hearing, DFS chose not to participate.
The TRO was entered on September 6, and was set to
expire after 14 days. DFS was served on September 13.
On September 19, unaware that DFS had already
been served, the court extended the TRO until Harley-
Davidson effected service on DFS pursuant to the
Hague Convention. Although it did not set a definite
expiration date, the court’s order anticipated that
process could take three to four months. However,
DFS appeared in the district court on October 4, making
clear to both Harley-Davidson and the court, at least as
of that date, that it had been served. On October 17,
the court held a telephonic status conference. The court
stood prepared to hold a preliminary injunction
hearing immediately, but DFS requested 45 to 60 days
to conduct discovery and to prepare. Accordingly, and
per DFS’s request, the hearing was set for December 15,
2011, and once the hearing was held, the court entered
a preliminary injunction, complete with the necessary
findings of fact and conclusions of law, on December 20.
On appeal DFS argues that the TRO the court entered
on September 6, 2011 was facially void and subject to
being vacated because it was “indefinitely extended” by
the district court, first on September 19 to allow Harley-
Davidson to effect service, and again at the October
17 status conference pending the prelim inary
injunction hearing. Rule 65 dictates that under
ordinary circumstances a temporary restraining order
cannot exceed 14 days, although the court may extend it
“for a like period” for good cause. Fed. R. Civ. P. 65(b)(2).
34 Nos. 11-3618, 11-3838 and 12-1280
In granting the extension on October 17, the district
court cited cases asserting that a district court could
extend a TRO for more than 20 (now 28) days to pro-
vide the parties adequate time to prepare for a pre-
liminary injunction hearing, see, e.g., Trefelner v. Burrell
School Dist., 655 F. Supp. 2d 581, 598-99 (W.D. Pa.
2009), and some district courts have taken the
approach that the 20- and 28-day limits do not apply if
the TRO was issued with notice to the enjoined party.
See 11A Wright & Miller, Federal Practice and
Procedure § 2953 at 280-83 (2d ed. 1995) (rejecting
notice argument but suggesting that extensions are ap-
propriate if needed to prepare for hearing). In our view,
the language of Rule 65(b)(2) and the great weight of
authority support the view that 28 days is the outer
limit for a TRO without the consent of the enjoined
party, regardless of whether the TRO was issued with or
without notice. See Sampson v. Murray, 415 U.S. 61, 86-88
(1974); Nutrasweet Co. v. Vit-Mar Enterprises, Inc., 112 F.3d
689, 692 (3d Cir. 1997); Pan American World Airways, Inc.
v. Flight Engineers’ Int’l Ass’n, 306 F.2d 840, 842-43 (2d
Cir. 1962); Connell v. Dulien Steel Products, Inc., 240 F.2d
414, 417 (5th Cir. 1957).
If a court fails either to extend the TRO or to issue
a preliminary injunction in its place, the TRO expires at
the close of the 28-day period. “Where a court intends to
supplant such an order with a preliminary injunction
of unlimited duration pending a final decision on
the merits or further order of the court, it should issue
an order clearly saying so. And where it has not done so,
a party against whom a temporary restraining order
Nos. 11-3618, 11-3838 and 12-1280 35
has issued may reasonably assume that the order has
expired within the time limits imposed by Rule 65(b).”
Granny Goose Foods, Inc. v. Brotherhood of Teamsters &
Auto Truck Drivers Local No. 70 of Alameda County, 415
U.S. 423, 444-45 (1974) (defendant could not be held in
contempt for violating TRO that was silent on its face as
to its intended duration; without either extension of
TRO or issuance of preliminary injunction, TRO could
be presumed to have expired as of Rule 65(b) time limit).
DFS argues that the Granny Goose Foods rule should
apply here because the extensions of the TRO were indefi-
nite. We disagree. The extensions were not silent about
duration. The September 19 extension was until DFS
was served under the Hague Convention, which had
already happened on September 13 (though Harley-
Davidson and the district court apparently did not
know that until October 4). The October 17 extension
stated the TRO would remain in effect until a decision
on the motion for preliminary injunction, which
occurred on December 20.6
6
We do find a gap, however, between October 4 and
October 17. By the terms of the district court’s September 19
extension, the TRO lasted “until” DFS was served — or, on this
record, until October 4, when it became clear to Harley-
Davidson and the court that DFS had been served. The gap
appears to have been inconsequential. This record does not
demonstrate that any activity occurred either on the docket
or between the parties between the short gap in time
between October 4 and October 17, when the court effectively
(continued...)
36 Nos. 11-3618, 11-3838 and 12-1280
When a TRO is extended beyond the 28-day limit with-
out the consent of the enjoined party, it becomes in
effect a preliminary injunction that is appealable, but
the order remains effective. See Sampson v. Murray, 415
U.S. at 86-88 (where court expressly extends a TRO
issued after notice and a hearing beyond the statutory
limit, the TRO does not cease to exist but instead
becomes an enforceable preliminary injunction subject
to appellate review); Commodity Futures Trading Comm’n
v. Lake Shore Asset Mgmt. Ltd., 496 F.3d 769, 771 (7th Cir.
2007) (“A temporary restraining order that remains in
force longer than 20 days [now 28 days] must be treated
as a preliminary injunction, which allows an appeal
under 28 U.S.C. § 1292(a)(1).”); Chicago United Indus. Ltd.
v. City of Chicago, 445 F.3d 940, 943 (7th Cir. 2006) (“A
temporary restraining order . . . if kept in force by the
district court for more than 20 [now 28] days without
the consent of the parties, . . . is deemed a preliminary
injunction and so is appealable.”); In re Criminal Contempt
Proceedings Against Crawford, 329 F.3d 131, 135-37 (2d
Cir. 2003) (analyzing interplay between Granny Goose
Foods and Sampson in rejecting defendants’ argument that
TRO automatically expired at end of Rule 65(b)(2)
time period; TRO had been explicitly extended by
district court and defendants could be held in criminal
contempt for violating its terms).
6
(...continued)
revived the terms of the September 6 order and extended it
until the preliminary injunction motion was decided.
Nos. 11-3618, 11-3838 and 12-1280 37
We take a moment to remind district courts that for
a TRO to be viable beyond the 28-day mark as a prelimi-
nary injunction, the order must comport with the
formal requirements for a preliminary injunction. Rule
65(d) requires both a TRO and a preliminary injunction
to “state the reasons why it issued,” and Rule 52(a)(2)
requires a statement of findings of fact and conclusions
of law for decisions granting or refusing an “inter-
locutory injunction” (a phrase that includes preliminary
injunctions). TROs issued on an emergency basis often
provide only terse explanations. When a district court
is considering extending a TRO beyond the 28-day limit,
it would be prudent to review the explanation given
to support the original order and to consider whether
a further explanation may be appropriate to allow mean-
ingful appellate review, as opposed to opening the
order up to being vacated and remanded for lack
of a sufficient explanation.
We recognize there will be cases where the maximum 28-
day limit does not give the parties sufficient time
to prepare for a preliminary injunction hearing, let
alone time for the district court to decide it. In those
cases, an extension of the TRO pending a preliminary
injunction hearing and decision without consent of
the enjoined party is technically a preliminary injunc-
tion: it is appealable, and the district court should
provide a sufficient explanation of its decision to
allow meaningful appellate review. See Fed. R. Civ. P.
52(a)(2). A court reviewing such an order for an abuse
of discretion should take into account the urgency
with which it was issued and the needs of the district
38 Nos. 11-3618, 11-3838 and 12-1280
court and the parties, but the law does not allow an
indefinite and unreviewable extension of a TRO with-
out the consent of the enjoined party. See Sampson, 415
U.S. at 86-88; Granny Goose Foods, 415 U.S. at 441.7
The district court’s September 6 TRO provided a
short explanation that was not supplemented until the
preliminary injunction was issued. If either party had
thought the original explanation was not sufficient
under Rule 52(a)(2) or Rule 65(d)(1)(A), it could have
raised the issue and the court could have corrected
any oversight very quickly. DFS did not raise such an
issue before the district court or on appeal and has
waived any argument it might have made in that re-
gard. See United States v. Johns, 686 F.3d 438, 449 (7th
Cir. 2012) (defendant waived argument by failing to
present it on appeal); Kunz v. DeFelice, 538 F.3d 667, 681
(7th Cir. 2008) (“Failure to adequately present an issue
to the district court waives the issue on appeal.”).
C. Preliminary Injunction
DFS argues that the preliminary injunction suffers
from the same Rule 65 issues as the temporary restraining
7
Another situation that can cause extraordinary urgency is
the removal of a case to federal court shortly before the
outer time-limit for a state-issued TRO will expire. E.g., Hoosier
Energy Rural Elec. Co-op., Inc. v. John Hancock Life Ins. Co., 588
F. Supp. 2d 919, 921-22 (S.D. Ind. 2008), aff’d, 582 F.3d
721 (7th Cir. 2009).
Nos. 11-3618, 11-3838 and 12-1280 39
order. For the reasons set forth above, we reject those
arguments. It also argues that the preliminary injunc-
tion should be vacated because the relevant facts are
hotly disputed by the parties and because the parties
have raised “novel and uncertain questions of law.” DFS
Br. 43-45, citing General Electric Co. v. American Wholesale
Co., 235 F.2d 606, 608 (7th Cir. 1956) (where issues of fact
are conflicting, an injunction should not issue without
an evidentiary hearing). Its argument is without merit.
General Electric is inapposite here because DFS raises no
argument that the evidentiary hearing afforded by the
district court was in any way inadequate. (DFS agreed
with Harley-Davidson in advance of the preliminary
injunction hearing that neither side would present live
testimony and that the court should decide the motion
on the affidavits and other papers of record.) Requests
for injunctive relief that present sharply contested facts
are routine in the federal courts. The “novel and uncer-
tain” questions of law DFS raises — whether section 14
or 10 of the contract applies to a corporate merger,
whether Greek law would deem Harley-Davidson’s
trademark rights “exhausted,” and whether only
nominal damages are warranted under Michigan
law — are issues of contract interpretation, nothing more,
and are neither novel nor particularly uncertain. More
important, though, the courts are equipped to handle both
contested facts and novel legal questions. Neither poses
a categorical bar to a preliminary injunction. DFS’s argu-
ments otherwise fail, and we affirm the district court’s
December 20, 2011 preliminary injunction against DFS.
40 Nos. 11-3618, 11-3838 and 12-1280
D. Anti-Suit Injunction
Finally, DFS argues that the district court overstepped
its equitable authority in its February 7, 2012 anti-suit
injunction order by enjoining DFS from defending
itself against Harley-Davidson’s Greek petitions. Its
argument is belied by its contrary assertion that the
February 7, 2012 order of the district court “does not
clearly or expressly” prohibit DFS from “defending”
itself against Harley-Davidson’s Greek petitions. DFS
Br. 48. What that order did was prevent DFS from
litigating in another action in a manner that would
“contradict, impair, or otherwise affect this Court’s
rulings, including the December 20, 2011 preliminary
injunction order, and/or this Court’s jurisdiction to ad-
judicate the present action.” The district court’s language
does not specifically mention the Harley-Davidson
Greek petitions, nor does it explicitly prevent DFS
from “defending” itself in those actions or any others
except to the extent that DFS’s defense would “con-
tradict, impair, or otherwise affect” the December 20
preliminary injunction. At this stage in the proceedings,
that lack of specificity is not particularly surprising.
Harley-Davidson filed its motion for an anti-suit
injunction on an emergency basis. At the time, little
information was available concerning the Greek actions.
Even with full information, there would have been
little time to gather and process that information on
an expedited basis.
In DFS’s words, only “after the fact” did the district
court interpret its February 7 anti-suit injunction order
Nos. 11-3618, 11-3838 and 12-1280 41
to mean that DFS was prohibited “from opposing plain-
tiff’s efforts to enforce in Greece the preliminary injunc-
tion.” DFS Br. 48. There is a critical problem with
DFS’s argument that the district court’s “after the fact”
interpretation exceeded the court’s equitable authority.
DFS was not prejudiced in any way by the court’s
February 22 interpretation. The district court’s interpreta-
tion was “after the fact” because by that point, the Harley-
Davidson Greek petitions had already been heard by
the Greek court, and the Greek court had already ruled
in Harley-Davidson’s favor. DFS had and took its
full opportunity to mount a vigorous defense against
Harley-Davidson’s Greek petitions. It argued forcefully
that the U.S. court’s preliminary injunction had no
effect and was unenforceable. In fact, it presented
Professor White’s affidavit to the Greek court and
argued, as it had to the U.S. district court, and as it has
on appeal, its unsubstantiated view that under
Michigan law, the Harley-Davidson/Elmec Agreement
did not impose any obligations on DFS. In other words,
DFS defended itself against Harley-Davidson’s Greek
enforcement petition by raising the same issues of
personal jurisdiction that it had litigated and lost before
the district court. Now, on appeal from the district
court’s anti-suit injunction, DFS has not identified any
argument or piece of evidence it was unable to present
to the Greek court due to the language of the February 7
order. Rightly or wrongly, the Greek court fully heard
DFS’s defense to the Harley-Davidson Greek petitions.
We have been informed by the parties, however, that
the Harley-Davidson Greek action is ongoing, with a
42 Nos. 11-3618, 11-3838 and 12-1280
final hearing currently scheduled for September 21, 2012.
DFS had the right, and still has the right, contrary to the
language the district court used in its February 22 order,
to appear and defend itself in that action, and we
instruct the district court to modify its February 22
order accordingly.8 However, DFS must defend itself in
a manner that is consistent with the district court’s Febru-
ary 7 order, which we affirm in every respect. In other
words, it may not “contradict, impair, or otherwise
affect this Court’s rulings, including the December 20,
2011 preliminary injunction order, and/or this Court’s
jurisdiction to adjudicate the present action.” (In particular,
we believe, short of intervention by the Supreme Court
of the United States, that this opinion closes the door
on DFS’s argument that the district court lacked
personal jurisdiction over it.) To the extent that DFS
requires further clarification or modification of the Feb-
ruary 7 anti-suit injunction order from the district court
as the Harley-Davidson Greek petitions proceed, it may
seek that clarification or modification from the district
court in the first instance.
8
For this reason, we also instruct the district court to disregard
the fact that DFS appeared in the Greek court and that it
(generally) mounted a defense against the Harley-Davidson
Greek petitions as evidence of DFS’s bad faith in Harley-
Davidson’s motion for sanctions and contempt, which is
pending in the district court. See Dkt. 109. However, the
court may consider, in its discretion, the extent to which
the specifics of DFS’s defense may or may not have “contra-
dicted,” “impaired” or “otherwise affected” the district court’s
orders in deciding whether sanctions are appropriate.
Nos. 11-3618, 11-3838 and 12-1280 43
Finally, DFS argues that the district court erred in
ordering it to dismiss the DFS Greek action. When DFS
filed its Greek action on November 15, 2011, DFS was
actively contesting personal jurisdiction in the case
before the district court. DFS contends that, “seeking
relief in a Greek court was the only way that DFS could
seek immediate affirmative relief against [Harley-
Davidson] without jeopardizing DFS’s pending juris-
dictional defense to [Harley-Davidson’s] action.” DFS
Br. 49. This argument is baseless. The law has long
been clear that a party may appear and litigate both
a personal jurisdiction defense and the merits of a case
without waiving the personal jurisdiction defense. See
United States v. Ligas, 549 F.3d 497, 502 (7th Cir. 2008)
(“The federal rules permit defendants to simultaneously
seek relief and raise a jurisdictional argument without
waiving that defense.”) (collecting cases). We explained
recently that, “to waive or forfeit a personal jurisdiction
defense, a defendant must give a plaintiff a reasonable
expectation that it will defend the suit on the merits
or must cause the court to go to some effort that would
be wasted if personal jurisdiction is later found lack-
ing.” Mobile Anesthesiologists Chicago, LLC v. Anesthesia
Associates of Houston Metroplex, P.A., 623 F.3d 440, 443
(7th Cir. 2010), citing American Patriot Ins. Agency, Inc. v.
Mutual Risk Management, Ltd., 364 F.3d 884, 887-88 (7th
Cir. 2004) (Rule 12(b)(3) defense of improper venue was
not waived or forfeited when defendant engaged in
preliminary pretrial litigation activity; plaintiff should
have anticipated defendant’s objection, and defendant
was not misleading the plaintiff or wasting judicial re-
sources).
44 Nos. 11-3618, 11-3838 and 12-1280
Whatever might be said about the merits of DFS’s
personal jurisdiction objection, there has never been
any doubt up to this point that it contests the issue. The
cases DFS cites in support of its fear that its personal
jurisdiction defense might be deemed waived are
simply not comparable. See Continental Bank, N.A. v.
Meyer, 10 F.3d 1293, 1296-97 (7th Cir. 1993) (personal
jurisdiction defense deemed waived after “defendants fully
participated in litigation of the merits for over two-and-a-
half years without actively contesting personal jurisdic-
tion” and “district court could properly conclude that the
defendants’ delay in urging this threshold issue
manifest[ed] an intent to submit to the court’s jurisdic-
tion”); Bel-Ray Co. v. Chemrite (Pty) Ltd., 181 F.3d 435, 443-
44 (3d Cir. 1999) (affirming finding that defendants waived
personal jurisdiction defense by doing “far more than
resist[ing] an application for a preliminary injunction;”
defendants raised personal jurisdiction defense in answer
but actively pursued summary judgment before litigating
personal jurisdiction).
International comity (the mutual respect of sovereigns)
requires the courts of one nation to avoid, where possible,
interfering with the courts of another. See Allendale
Mutual Ins. Co. v. Bull Data Systems, Inc., 10 F.3d 425, 431-
33 (7th Cir. 1993); Philips Medical Systems Int’l B.V. v.
Bruetman, 8 F.3d 600, 604-05 (7th Cir.1993). DFS has
raised no argument and presented no evidence sug-
gesting that the district court’s anti-suit injunction threat-
ened international comity. The Greek court has provi-
sionally granted Harley-Davidson’s motion for a tempo-
rary order enforcing the U.S. district court’s Decem-
Nos. 11-3618, 11-3838 and 12-1280 45
ber 20 preliminary injunction, and revoked its prior
provisional order in the DFS Greek action. We therefore
have no reason to fear that the anti-suit injunction in-
fringed Greece’s sovereignty in any way.
Even if we had some sense that international comity
could become an issue, our court ordinarily allows an
injunction against litigating in a foreign forum “upon
a finding that letting the two suits proceed would be
gratuitously duplicative, or as the cases sometimes say
vexatious and oppressive.” Allendale, 10 F.3d at 431 (inter-
nal quotations omitted). DFS argues that the district
court’s conclusion that its prosecution of the DFS Greek
action was “vexatious and oppressive” was clearly er-
roneous, but we disagree. As the district court wrote in
its February 7 decision, DFS’s Greek action was “a
blatant attempt by defendant to relitigate issues that
[the court had] already decided, and it has resulted in
an injunction in Greece that directly contradicts this
court’s orders.” DFS made a conscious decision to
conceal its Greek action from the district court. It then
failed to disclose to the Greek court that U.S. proceedings
were pending or that the TRO had been issued. It pro-
ceeded to prosecute the very issues that were being
actively litigated in the U.S. district court, specifically
DFS’s rights and obligations under the Harley-
Davidson/Elmec Agreement. Its chosen strategy was a
direct threat to the jurisdiction of the district court
and exposed Harley-Davidson to duplicative litigation
and the possibility of inconsistent rulings. We see no
error in the district court’s determination that an injunc-
tion prohibiting DFS from prosecuting its action in
46 Nos. 11-3618, 11-3838 and 12-1280
Greece was appropriate under these circumstances, and
we affirm the district court’s February 7 preliminary anti-
suit injunction order.
III. Conclusion
We affirm the district court’s orders with instructions
to modify its anti-suit injunction orders to reflect that
DFS is permitted to appear and defend itself against the
Harley-Davidson Greek petitions so long as it does so in
a manner that is consistent with and does not infringe
on the December 20, 2011 preliminary injunction or any
other rulings made thus far in this proceeding — including
this ruling on appeal.
A FFIRMED.
9-5-12