Last week, the U.S. Court of Appeals for the Fourth Circuit issued a precedential opinion in Fleet Feet, Inc. v. Nike, Inc., No. 19-2390 (Jan. 26, 2021). The Court dismissed Nike’s appeal of the preliminary injunction entered against it as moot and remanded the case for further proceedings.
In 2019, Nike launched its marketing campaign using the tagline “Sport Changes Everything.” Fleet Feet sued alleging that the campaign infringed Fleet Feet’s trademarks “Change Everything” and “Running Changes Everything.” The district court granted a preliminary injunction. Nike appealed. While the appeal was pending, Nike ended its campaign and disavowed any intent to continue using the tagline.
Because Nike no longer had a legally cognizable interest in the validity of the preliminary injunction, the Fourth Circuit dismissed the appeal as moot. A case becomes moot when the issues presented are no longer “live;” in other words, when circumstances have made it impossible for the appellate court to grant relief to the prevailing party.
Nike had argued that two live issues remained on which the Court could, and should, grant relief. Specifically, Nike argued (1) it continued to be restrained from use of any designation confusingly similar to Fleet Feet’s marks and (2) Nike should recover the injunction bond. On the first issue, the Court concluded that because Nike disavowed continued use of the tagline, restraint of confusingly similar designations created only a potential controversy not able to sustain the appeal. Nike failed to identify any actual speech threatened by the preliminary injunction. On the second issue, the Court concluded that although the issue of the injunction bond kept the case from being mooted, it did not keep the appeal from becoming moot. Issues related to the injunction bond first had to be resolved at a trial on the merits.
The Court also refused Nike’s request that it vacate the district court’s order and opinion granting the preliminary injunction. While an appellate court may vacate final judgments when a controversy becomes moot during the pendency of the appeal, the equitable concerns underlying such action do not exist when the mooted appeal is of a preliminary injunction. The Court concluded that vacating the preliminary injunction order and opinion was unnecessary because the preliminary injunction has no preclusive effect on the district court’s later decision on whether to enter a permanent injunction.