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Case 3:12-cv-00296-FM Document 45 Filed 08/09/13 Page 1 of 6

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS EL PASO DIVISION LEAGUE OF UNITED LATIN AMERICAN CITIZENS, INC. , Plaintiff, v. TEXAS LEAGUE OF UNITED LATIN AMERICAN CITIZENS, LINDA CHAVEZ, BEA MARTINEZ, and JOEY CARDENAS, Defendants.

EP-12-CA-296-FM

ORDER GRANTING DEFENDANTS MOTION FOR DECLARATORY JUDGMENT On this day, the court considered Defendants Linda Chavez, Bea Martinez, and Joey Cardenas (collectively Defendants) Defendants Motion for Declaratory Judgment, Relief from Judgment, and Preliminary Injunction (Motion) [ECF No. 28], filed June 7, 2013; the League of United Latin American Citizens, Inc. (LULAC) LULACs Brief in Response to Defendants Rule 60(b) Motion (Response) [ECF No. 39], filed July 19, 2013; and Defendants Reply to Plaintiffs Brief in Response to Defendants Rule 60(b) Motion (Reply) [ECF No. 43], filed August 5, 2013. I. BACKGROUND In July 2012, LULAC filed a complaint alleging that Defendants, former officers of LULAC, had engaged in trademark infringement and unfair competition by forming an independent organization called the Texas League of United Latin American Citizens (TX LULAC).1
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TX LULAC had allegedly adopted LULACs constitution and by-laws as its own,

See Plaintiffs Original Complaint [ECF No. 1].

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and was attempting to operate as a non-profit advocacy organization using LULACs membership lists. LULACs claims were resolved by an agreed final judgment and permanent injunction (Agreed Judgment), which the court approved and entered on December 20, 2012.2 Among other provisions, the Agreed Judgment stipulated that: Defendants are hereby and forever PERMANENTLY ENJOINED from using the name League of United Latin American Citizens, LULAC and/or the LULAC shield logo, or any other name or mark confusingly similar to League of United Latin American Citizens, LULAC and/or the LULAC shield logo, in relation to or connection with the Defendant TX LULAC, a Texas non-profit corporation or TX LULAC, as a separate entity from LULAC or any other organization Defendants may wish to organize or join. This shall include but not be limited to Defendants referring to themselves as officers or directors of TX LULAC, except in their former capacities as officers or directors of TX LULAC.3 The final judgment included a provision for this court to retain jurisdiction of the case as it relates to compliance by Defendants with this judgment, and to make clarifying Orders regarding this Permanent Injunction.4 Months after the Agreed Judgment was entered, Defendants filed the instant Motion. The Motion alleges that in March 2013 Defendant Linda Chavez declared her candidacy for State Director of LULAC. Following this announcement, Chavez actively campaigned for this position among LULAC membership. However, at the Texas state LULAC convention on June 2, 2013, the LULAC National Treasurer, Roger Rocha, declared Chavez to be ineligible for the State Director Position, based on the Agreed Judgment previously entered in this case. LULAC

See Agreed Final Judgment and Permanent Injunction [ECF No. 25]. Agreed Judgment, at 2 (emphasis in original). Id. at 5.

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continues to take the position that the judgment prohibits Defendants from holding elected office in the LULAC organization. Defendants maintain that LULAC leadership is distorting the Agreed Judgment to improperly restrict them from holding office in the organization. They represent they have complied with all terms of the Agreed Judgment, and request the court to enter a declaratory judgment clarifying the terms in dispute. In the alternative, Defendants seek relief from the Agreed Judgment pursuant to Federal Rule of Civil Procedure 60. II. DISCUSSION A. Courts Jurisdiction

As a threshold matter, the court finds it has subject matter jurisdiction to decide this Motion. Although the Declaratory Judgment Act, 28 U.S.C. 2201 does not provide a basis for jurisdiction, a federal court has ancillary jurisdiction to interpret a prior court order.5 B. Clarification of Agreed Judgment Under the Declaratory Judgment Act

LULAC maintains that by agreeing to the ban on referring to themselves as officers or directors of TX LULAC, Defendants are barred from running for any elected office in LULAC, including offices at the state level of the organization. Defendants dispute this interpretation, arguing that the Agreed Judgment simply prohibits them from identifying themselves as officers of the now-defunct TX LULAC.
See City Of El Paso, Tex. v. El Paso Entmt, Inc., 382 F. Appx 361, 364 (5th Cir. 2010) (citing Peacock v. Thomas, 516 U.S. 349, 357 (1996); Royal Ins. Co. of Am. v. Quinn-L Capital Corp., 960 F.2d 1286, 1292 (5th Cir. 1992); Peter Bay Homeowners Assn, Inc. v. Stillman, 294 F.3d 524, 533 (3d Cir. 2002)).
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To interpret a consent decree, the court applies general principles of contract interpretation.6 The court first looks to the four corners of the decree.7 If the decree is ambiguous, the court then considers extrinsic evidence.8 A decree is ambiguous when it is reasonably susceptible to more than one meaning, in light of surrounding circumstances and established rules of construction.9 Here, there is no need to consider extrinsic evidence, as the court finds the agreed judgment is not ambiguous as a matter of law. Read in context, the disputed sentence is defined and limited by the sentence preceding it, which enjoins Defendants from using the LULAC name or mark in relation to or connection with the Defendant TX LULAC, a Texas non-profit corporation or TX LULAC, as a separate entity from LULAC or any other organization Defendants may wish to organize or join.10 The Agreed Judgment goes on to state: This shall include but not be limited to Defendants referring to themselves as officers or directors of TX LULAC, except in their former capacities as officers or directors of TX LULAC.11 The judgment makes a clear distinction between LULAC and TX LULAC, referring to Plaintiff, the LEAGUE OF UNITED LATIN AMERICAN CITIZENS (hereinafter sometimes referred to

Dean v. City of Shreveport, 438 F.3d 448, 460 (5th Cir. 2006) (citation omitted). Id. at 460 (internal quotation marks and citation omitted). Id. Id at 460-61. Agreed Judgment, at 2. Id. (emphasis in original).

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as LULAC) [and] Defendants, TEXAS LEAGUE OF UNITED LATIN AMERICAN CITIZENS, a Texas non-profit corporation (hereinafter sometimes referred to as TX LULAC).12 As stated in the judgment, the term TX LULAC thus refers to the Defendants independent organization, which is now defunct, as distinct from LULACs state organization Texas LULAC. Under the terms of the judgment, Defendants are not barred from any use of the LULAC name, nor are they precluded from referring to themselves as LULAC officers or directors, should any of them in fact hold such a position. Rather they are enjoined from referring to themselves as officers of TX LULAC and from using the LULAC name in relation to or connection with Defendant TX LULAC or another organization they may wish to organize or join. LULAC cannot be characterized as another organization Defendants may wish to organize or join, since Defendants are already members of this organization. Thus, the plain terms of the Agreed Judgment do not bar Defendants from seeking or holding elected office in LULAC, including offices at the state level of the organization Accordingly, the language in the Agreed Judgment is not ambiguous, and Defendants are entitled to a declaratory judgment to this effect. C. Request for Relief from Judgment under Rule 60

Pursuant to Federal Rule of Civil Procedure 60(b), a party may seek relief from a final judgment on a variety of grounds, including fraud, mistake, newly discovered evidence, or any other reason that justifies relief.13 Having clarified that the Agreed Judgment does not preclude

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Id. at 1. Fed. R. Civ. P. 60(b).

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Defendants from seeking or holding elected office in the LULAC organization, the court need not address Defendants alternate request for relief pursuant to Rule 60. III. CONCLUSION The court hereby ENTERS a declaratory judgment to clarify that nothing in the Agreed Final Judgment and Permanent Injunction [ECF No. 25] restricts Defendants from seeking or holding elected office in LULAC or LULACs state organization, Texas LULAC. SO ORDERED. SIGNED this 9th day of August, 2013.

______________________________________ FRANK MONTALVO UNITED STATES DISTRICT JUDGE