Cook County Record

Friday, December 13, 2019

Reverse Mortgage Solutions accuses homonymous company of holding its name for ransom

By Scott Holland | Jan 16, 2016

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They’ve got the same name, but one Reverse Mortgage Solutions is the plaintiff and the other, a defendant in a federal trademark lawsuit, accused of swooping in to claim the corporate name and hold it for ransom. And the original Reverse Mortgage Solutions has won a preliminary injunction against its homonymous rival.

Judge Virginia M. Kendall last month issued an opinion on the matter, which arose after the original Reverse Mortgage Solutions missed a deadline to file for using that name, as well as Security One Lending, its corporate identity in Illinois.

“Defendant swept in and registered with the state,” Kendall wrote, “to use the marks in spite of not having any direct business plan or immediate reason to use the marks.”

The court granted the plaintiff’s motion for a temporary restraining order on Oct. 27, and several motions followed. In the opinion issued Dec. 29, Kendall denied the plaintiff’s motion for default judgment and an order to show cause, while granting the defendant’s motion for leave to file an answer and affirmative defenses. She did, however, grant the plaintiff’s motion for a preliminary injunction.

Kendall ordered the defendant to submit materials necessary to change its names, including filing its Illinois Corporation amendment for expedited processing. She noted it was the plaintiff’s error that made the alleged infringement possible, and also chastised the plaintiff for failing to file for a preliminary injunction in a timely fashion, leaving the court to resolve the issue sandwiched between Christmas and New Year’s Eve.

“Further,” she wrote, “plaintiff filed a proposed order that was supposedly a reflection of this court’s oral rulings at the (temporary restraining order) hearing but instead included relief that this court never ordered.”

The defendants also delayed in answering the complaint, she noted, warning “failure to timely comply with this court’s order will result in the issuance of a rule to show cause why defendant should not be held in contempt.”

Although the defendant is in procedural default for missing the deadline to respond to the first amended complaint, Kendall said there is proof the defendant has maintained sufficient regard for the litigation such that she denied the motion for default judgment, as well as the request for the court to enforce its temporary restraining order.

Since the defendant did stop using the trademarks in question, Kendall denied the plaintiff’s motion for an order to show cause why the defendant should be held in contempt. However, since Kendall determined the plaintiff has a likelihood of success in its federal trademark infringement claim, she granted the motion for preliminary injunction.

“Defense counsel’s demeanor and lack of candor throughout the proceeding with the Court evidence his lack of honest intentions,” Kendall wrote. “The evidence before the Court at this time is that defendant intentionally copied plaintiff’s marks with no plan other than to hold the marks hostage in order to seek a hefty settlement award.”

The plaintiff argued “it has been actively promoting, marketing, and advertising in Illinois and on the Internet for the past nine years and will lose good will, business reputation and customer confidence” and that “it has been unable to secure $11.2 million in loans as a result of this conflict.”

Further, Kendall noted, “When the nature of the loss may make damages difficult to calculate, as in this case since the loss is to one’s reputation, the virtual impossibility of measuring precise economic consequences renders a damages remedy inadequate.”

Plaintiff Reverse Mortgage Solutions is represented by the firms of TSR Injury Law, of Blooming, Minn.; Brown Rudnick Berlack Israels, of Boston; and Molo Lamken, of Chicago.

Defendant Reverse Mortgage Solutions is represented by attorney Thomas J. Laz, of Lisle.

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Organizations in this Story

TSR Injury LawBrown Rudnick LLPMolo Lamken LLP