Case 1:10-cv-04917 Document 8 Filed 08/05/10 Page 1 of 17

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

BERNINA OF AMERICA, INC., )

)
Plaintiff, ) Case Number: 1:10-cv-4917
)
v. )
) Judge Milton I. Shadur
IMAGELINE, INC., ISLANDVIEW )
TECHNOLOGIES LLC, ISLANDVIEW )
DESIGNS LLC, and GEORGE ) Magistrate Judge Martin C. Ashman
P. RIDDICK, III, )
)
Defendants. )

MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFF’S MOTION FOR

TEMPORARY RESTRAINING ORDER AND PRELIMINARY INJUNCTION

Plaintiff Bernina of America, Inc. (“Bernina”) moves for a temporary restraining order

and preliminary injunction enjoining Defendant George P. Riddick, III (“Riddick”), Defendant

Imageline, Inc. (“Imageline”), Defendant Islandview Technologies LLC and Defendant

Islandview Designs LLC (collectively, “Islandview”), from continuing their ongoing campaign

of malicious and tortious interference with Bernina’s contractual relationships with its network

of independent authorized dealerships (“Bernina Dealer Network”), and their dissemination of

false and defamatory statements about Bernina.

INTRODUCTION

Defendants have a long history of exaggerating, misusing, and misrepresenting the

existence and scope of several extremely limited copyright registrations belonging to Defendant

Imageline. Defendants have made a common practice of using the existence of these limited

registrations to coerce “settlements” out of numerous victims, who typically do not have the

resources to defend themselves. Entities that refuse to acquiesce to Defendants’ unreasonable

demands often find themselves the target of Defendants’ campaign of harassment, defamation,
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and malicious efforts to disrupt these entities’ business interests. Defendants have now trained

their sights on Bernina. For nearly 18 months, Defendant Riddick, acting on behalf of Imageline

and Islandview, has threatened Bernina and attempted to coerce Bernina into paying millions of

dollars in “settlement” money and making other unreasonable concessions based on false and

bad-faith allegations that Bernina has infringed various individual clip art images. Defendants

are aware that these allegations are false because (1) Bernina has not reproduced, displayed,

marketed, sold, distributed or otherwise engaged in any unauthorized exercise of any of the

exclusive rights with respect to the images Imageline purports to own; and (2) for reasons

discussed further herein (all of which are known to Defendants) Imageline is not entitled to

copyright protection over the individual images that it claims to own.

An injunction is immediately necessary in this case because Defendants are contacting,

harassing, and threatening the Bernina Dealer Network in an effort to confuse, intimidate, and

frighten the dealers (many of which are small businesses with limited resources) and to create

divisions between the Bernina Dealer Network and Bernina. Defendants have also maliciously

disseminated to the Bernina Dealer Network known falsities about Bernina. By reason of

Defendants’ continuing conduct, Bernina has suffered and continues to suffer irreparable harm to

its business, goodwill and reputation. Accordingly, Bernina requests a temporary restraining

order and preliminary injunction.

RELEVANT FACTUAL BACKGROUND

I. Bernina and Its Relevant Products

Bernina is the exclusive United States distributor for Bernina International AG, the

world’s largest privately-held manufacturer of state-of-the-art sewing and embroidery systems,

sergers and embroidery software. See Declaration of Michael Perich (“Perich Dec.”) at ¶ 2.

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Bernina sells its products exclusively through the Bernina Dealer Network, which consists of

approximately 500 fully-trained independent dealerships. Id. at ¶ 3. Because Bernina’s products

are sold exclusively through the dealerships in the Bernina Dealer Network, Bernina’s

relationship with the Bernina Dealer Network is of vital importance to Bernina’s financial well-

being. Id. at ¶ 4. Among the products that Bernina sells are sewing machines that are capable of

uploading digital images, designs and patterns which can be reproduced onto fabric. Id. at ¶ 5.

The preexisting digital images that can be used in Bernina products are sold or distributed mainly

by third party companies including some subsidiaries of Bernina, although at times Bernina has

sold designs that are exclusive to Bernina and distributes a small number of images to customers

for promotional purposes. Id. at ¶ 6.

II. Defendants’ Malicious Attack on Bernina and Its Dealers

In December 2008, Riddick, on behalf of Imageline, began accusing Bernina and some of

its subsidiaries of “flagrant copyright infringement” of “large quantities” of Imageline’s

purportedly copyright-protected clip art images. Riddick demanded that Bernina pay him

Imageline’s “standard” settlement rates, which would amount to millions of dollars based on the

number of infringements Riddick alleged. See 12/29/08 Email From G. Riddick to J. Woods

(attached as Ex. A). Although Riddick claimed to have discovered distribution of Imageline’s

purportedly-owned images by other entities including Bernina subsidiaries, Riddick never

identified any basis for his accusation that Bernina itself had engaged in copyright infringement.

Riddick had no good faith basis to make such allegations about Bernina which had not

reproduced, displayed, marketed, sold, distributed or otherwise engaged in any unauthorized

exercise of any of the exclusive rights protected by copyright with respect to the accused images.

Perich Dec. at ¶ 9. Nonetheless, Riddick continued with thinly-veiled attempts to coerce

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settlement money out of Bernina and/or business concessions favorable to Imageline. See 1/5/09

Email from G. Riddick to P. Newton (attached as Ex. B). Bernina, on numerous occasions,

requested that Riddick produce copyright deposits for Imageline’s registrations or any other

evidence of its ownership of the clip art images in which it claimed rights. See e.g., 1/2/09 Letter

from B. Fergemann to G. Riddick (attached as Ex. C). Riddick, however, ignored these requests

and instead continued to harass Bernina with outrageous demands that were at all times

“conditioned upon [Bernina and its subsidiaries] having a cooperative business relationship

moving forward” with Imageline. See 2/13/09 Email from G. Riddick to B. Fergemann (attached

as Ex. D). In February 2009, Bernina terminated all communications with Riddick.

In May 2010, Riddick reemerged with the same false allegations of copyright

infringement and threats of litigation on behalf of Imageline and another company he claimed to

represent, Defendant Islandview. See 6/3/10 Email from G. Riddick to M. Favre (attached as Ex.

E). Riddick, once again, sought to coerce Bernina into a “business partnership” with newly-

formed Islandview as part of efforts to increase its “worldwide presence in the growing home

embroidery design market.” Id. In response, Bernina demanded that Defendants immediately

refrain from making false and defamatory allegations against Bernina and interfering with

Bernina’s relationship with its dealers and again requested that Riddick identify all of the

images that it claimed were infringed and produce evidence of its ownership of those images.

See 6/28/10 Letter from B. Fergemann to G. Riddick (attached as Ex. F).

Instead of supplying evidence to support his claims, Riddick began in June 2010, to send

a series of email messages and letters directly to the Bernina Dealer Network on behalf of

Imageline and Islandview. See e.g. 6/17/10 Email from G. Riddick to L. Stevens (attached as

Ex. G); 6/17/10 Email from G. Riddick to All Bernina Dealers (attached as Ex. H). In these

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letters and emails, Defendants falsely alleged copyright infringement against Bernina and these

dealers and threatened them with litigation. Ex. G, 6/17/10 Email to L. Stevens. Defendants

falsely asserted that the dealers’ association with Bernina had subjected them to vast liability and

potentially crippling damages awards. See Ex. H, 6/17/10 Email to All Bernina Dealers; 6/25/10

Email from G. Riddick to All Bernina Dealers (attached as Ex. I); 6/25/10 Email Chain from

Imageline to All Bernina Dealers (attached as Ex. J). These email messages and letters also

included numerous false and defamatory statements about Bernina including: (1) that Bernina

has engaged in willful copyright infringement; (2) that Bernina and its corporate officers have

acted unethically; (3) that Bernina and its corporate officers have ignored the best interests of the

dealers and has exposed them to legal liability; (4) that Bernina and its corporate officers have

knowingly made false statements to the Bernina dealers and others; (5) that Bernina and its

corporate officers have directly caused damage to the Bernina independent dealers; and (6) that

Bernina and its corporate officers have engaged in unlawful activities. See e.g., 6/30/10 Letter

from G. Riddick to All Bernina Dealers (attached as Ex. K) (accusing Bernina of various

“unlawful activities” including using “stolen property”); 7/9/10 Email from G. Riddick to L.

Stevens (attached as Ex. L) (describing Bernina as “digital pirates” engaged in “deceit and

cover-up activities”).

Despite knowledge of the falsity of their claims, Defendants’ threats and harassment of

Bernina and the Bernina Dealer Network, their tortious interference with Bernina’s contractual

relationship with its dealers, and their publication of defamatory statements have only

intensified. These threats and falsehoods have had their intended effect of “upsetting and

frightening” numerous members of the Bernina Dealer Network. See 7/2/10 Email from C.

Racine to Bernina (attached as Ex. M); see also Perich Dec. at ¶¶ 13-14. In fact, Riddick has

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boasted that many of the third parties he had contacted are “disgusted by Bernina’s deceitful

business practices” and that Bernina dealers are “cooperating” with Imageline against Bernina.

See e.g., 7/14/10 Letter from G. Riddick to B. Fergemann (attached as Ex. N); Ex. L, 7/9/10

Email to L. Stevens).

III. Defendants’ False Allegations of Copyright Ownership

Not only are Defendants fully aware that Bernina has not reproduced, displayed,

marketed, sold, distributed or otherwise engaged in any unauthorized exercise of any of the

exclusive rights provided by 17 U.S.C. § 106, but Defendants are also fully aware that Imageline

does not possess copyright registrations for the individual images on which they base their

specious claims of copyright infringement. Defendants base their threats of litigation against

Bernina on two copyright registrations from the mid-1990’s: (1) the “Imageline Design Gallery,”

Reg. No. VA 841-528, effective March 18, 1997 containing 2730 electronic graphic designs; and

(2) the “Imageline Master Gallery,” Reg. No. VA 751-565, effective May 3, 1996, containing

9618 electronic images. See Ex. N, 7/14/10 Letter to B. Fergemann; Registration Extract from

the United States Copyright Office Database (attached as Ex. O). Imageline also appears to own

the following two additional copyright registrations: (3) the “PicturePak SuperBundle,” Reg. No.

VA 746-773, effective March 12, 1996, purportedly compiled from five prior collections created

in 1991; and (4) “Headliners,” Reg. No. VA 844-189, effective March 12, 1997. Ex. O.

To those who are not well versed in the complexities of copyright law, which includes

the vast majority of dealers in the Bernina Dealer Network, Defendants’ claims seem to carry

the imprimatur of validity. However, as explained further below, Imageline’s copyright

registrations are derivative works of preexisting compilations of images that Imageline failed to

disclose in its copyright registration applications and in no case cover the images in these

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compilations individually. Defendants are aware of this fact, in part, because they were

explicitly told as much by the United States Copyright Office nearly 15 years ago. See 5/31/96

Letter from the U.S. Copyright Office to Imageline (attached as Ex. P). Yet Defendants persist

in spreading known falsities about the nature of their copyright protections and the conduct of

those they claim to have committed unlawful copyright infringement. Such falsities, along with

other untruths routinely spread in Defendants’ smear campaign against Bernina, constitute

defamation per se and Defendants’ tactic of maliciously interfering in Bernina’s relationship

with its dealers constitutes tortious interference with contractual relationships. Defendants’

activities have caused, and continue to cause, Bernina to suffer irreparable injury.

ARGUMENT

A party seeking preliminary injunctive relief must demonstrate that (1) its case has some

likelihood of success on the merits; (2) no adequate remedy at law exists; and (3) it will suffer

irreparable harm if the injunction is not granted. Girl Scouts of Manitou Council, Inc. v. Girl

Scouts of the United States of Am., Inc., 549 F.3d 1079, 1086 (7th Cir. 2008). After the moving

party satisfies these three elements, “the court must then consider any irreparable harm an

injunction would cause the nonmoving party.” Id. “Finally, the court must consider any

consequences to the public from denying or granting the injunction.” Promatek Indus., Ltd. v.

Equitrac Corp., 300 F.3d 808, 811 (7th Cir. 2002) (citation omitted); Cleveland Hair Clinic, Inc.

v. Puig, 968 F. Supp. 1227, 1249 (N.D. Ill. 1996) (granting a motion for a preliminary injunction

in a case involving a threat of lost goodwill as a result of tortious interference with a business or

contractual relationship).

A temporary restraining order (“TRO”) is for the purposes of “maintain[ing] the status

quo until a hearing can be held on an application for a preliminary injunction.” Abbott Labs. v.

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Andrx Pharmaceuticals, Inc., 05-cv-1490, 2005 WL 1273105, at *1 (N.D. Ill. May 20, 2005).

“The standards for a temporary restraining order and a preliminary injunction are identical.”

Bernina of America, Inc. v. Fashion Fabrics Intern., Inc., 01-cv-585, 2001 WL 128164, at *1

(N.D. Ill. Feb. 9, 2001). The balance of the factors in this case weighs substantially in favor of

granting Bernina’s motion for a temporary restraining order and preliminary injunction.

I. Bernina Has An Strong Likelihood Of Success On The Merits

Bernina has a strong likelihood of establishing that Defendants are engaging in

defamation, defamation per se, and tortious interference with a contractual relationship. To

establish this prong of the test for preliminary injunctive relief, a party must show that it has

“some likelihood of success on the merits,” National People’s Action v. Wilmette, 914 F.2d 1008,

1010 (7th Cir. 1990) (emphasis added), or that its chances of succeeding are “better than

negligible.” Ty, Inc. v. Jones Group, Inc., 237 F.3d 891, 897 (7th Cir. 2001); Cleveland Hair

Clinic, Inc., 968 F. Supp. at 1241 (describing the likelihood of success prong as a “more modest”

factor under the precedent set by Roland Machinery Co. v. Dresser Indust., Inc., 749 F.3d 380

(7th Cir. 1984)).

A. Defamation

To succeed on its defamation claim under Illinois law, Bernina must show that

Defendants (1) made a false statement concerning Bernina; (2) that Defendants made an

unprivileged communication of this statement to a third party; and (3) that Bernina suffered

damage as a result. Ptasznik v. St. Joseph Hosp., 464 F.3d 691, 698 (7th Cir. 2006); Krasinski

v. United Parcel Service, Inc., 124 Ill. 2d 483, 490 (1988). Under Illinois law, a defamatory

statement is one that “tends to cause such harm to the reputation of another that it lowers that

person in the eyes of the community or deters third persons from associating with him.” Gehrls

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v. Gooch, 09-cv-6338, 2010 WL 1849400, at *3 (N.D. Ill. May 7, 2010) (citation omitted).

Moreover, a statement is defamatory per se if it is “obviously and materially harmful.” Van

Horne v. Muller, 185 Ill. 2d 299, 307 (1998). When a plaintiff is a corporation, a statement is

defamatory per se if it “assail[s] the corporation’s financial position or business methods, or

accuse[s] it of fraud or mismanagement.” Hackman v. Dickerson Realtors, Inc., 520 F. Supp. 2d

954, 970 (N.D. Ill. 2007).

Here, Defendants’ letters and emails to the independent dealers in the Bernina Dealer

Network are statements published to third parties. These statements are obviously and materially

harmful to Bernina and the reactions of several dealers within the Bernina Dealer Network in

response to Defendants’ statements, clearly establishes that these statements tend to cause harm

to Bernina’s reputation, lowers Bernina in the eyes of its dealers, and deters its dealers from

associating with Bernina. See Ex. M, 7/2/10 C. Racine Email; see also Perich Dec. at ¶¶ 13-14.

Indeed, in light of the fact that Defendants have repeatedly alleged that Bernina has broken the

law, has been dishonest, and has mismanaged the situation to the detriment of its dealers,

Defendants’ comments are defamatory per se and harm to Bernina is presumed. Hackman, 520

F. Supp. 2d at 969 (stating that for the purposes of defamation per se, accusing someone of

“dishonesty” is the same thing as accusing someone of fraud). Lastly, Bernina has established

both that these statements by Defendants are false and that Defendants had knowledge of their

falsity or, at the very least, “reckless disregard” for the truth or falsity their statements.

Krasinski, 124 Ill. 2d at 491.

1. Bernina Has Not Infringed Any Imageline Images

Defendants’ allegations regarding Bernina’s copyright infringement are false due to the

fact that Bernina never had any involvement with the images Defendants have claimed to own

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and Defendants have no basis to conclude that they did. Not one of the small number of design

collections that Bernina distributes contains any of the images Defendants have claimed as

property of Imageline. Perich Dec. at ¶ 9. Thus, Bernina has never infringed upon the images

that Imageline claims to own and Defendants’ statements to the contrary have no basis in fact.

See Int’l Profit Assocs., Inc. v. Paisola, 461 F. Supp. 2d 672, 678 (N.D. Ill. 2006) (finding on a

TRO that it was sufficient for the plaintiff to demonstrate by affidavit that only some of the

statements at issue were false).

2. Defendants Misrepresent the Nature of Their Copyright Protections

Even if Bernina had distributed or sold any of the images Defendants claim that

Imageline owns, which it has not, Defendants have still made false statements and

misrepresentations about the nature of the copyright protections Imageline possesses. According

to Imageline’s statements in its copyright registration applications, each of its copyright

registrations are derivative works of preexisting works dating back to prior unregistered works.

As derivative works, copyright protection only extends to the material in these registrations that

was “contributed by the author of such work, as distinguished from the preexisting material

employed in the work, and does not imply any exclusive right in the preexisting material.” 17

U.S.C § 103. Furthermore, “protection for a work employing preexisting material in which

copyright subsists does not extend to any part of the work in which such material has been used

unlawfully.” Id. Each of the works in Imageline’s registrations is also a derivative work of other

products that Imageline failed to disclose in its copyright registration applications. Defendants

have never produced evidence to establish their ownership of these images and it is quite

possible that some or all of the images in each of Imageline’s registrations were authored by

entities other than Imageline and that their works were never lawfully assigned to Imageline.

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Defendants base all of their threats and accusations of copyright infringement upon the

theory that Bernina and others have infringed upon the underlying images in their enormous

derivative compilation registrations. They do so despite the fact that they were told by the

Copyright office nearly 15 years ago, that such registrations did not extend to the underlying

images. Ex. P, 5/31/10 U.S. Copyright Office Letter. Imageline and Riddick were advised by

the Copyright Office that Imageline’s application for the PicturePak SuperBundle (Copyright

Reg. No. VA 746-773) “may not extend copyright registration to all the pictorial authorship you

want it to cover” because the images might have been published previously at “earlier times in

several different publications. . . .” Id. The Copyright Office further concluded that Imageline’s

application “may register [a] claim to only that work which is being published for the first time

in it.” Id. The Copyright Office also informed Imageline that if it wished to claim copyright for

each individual image, it was required to submit separate application and fees and deposit copies

“for each different unit of first-publication.” Id. Finally, the Copyright Office directed

Imageline not to make any reference to a claim for a compilation copyright, “because no

discretionary selection has been made if all of the preexisting images have been re-published

here.” Id.

Imageline has never filed separate applications and fees or obtained individual copyright

registrations for the underlying images in any of Imageline’s copyright registrations.

Imageline’s registrations do not even create any presumption of validity of copyright in the

compilations and derivative works, much less any of the individual underlying images. The

Copyright Office has never been afforded an opportunity to examine the individual pieces of clip

art for their individual registrability. The vast majority of the clip art images for which

Imageline claims copyright ownership (if not all) also do not qualify as “original works of

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authorship” eligible for copyright protection under 17 U.S.C. § 102 for the following reasons,

among others: (1) some clip art images were copied from art that was in the public domain; (2)

some clip art images were copied from art that is the copyrighted property of others; (3) some

clip art images copied or infringed third party trademarks or service marks; (4) some clip art

images do not embody sufficient originality to constitute an “original work of authorship” under

17 U.S.C. § 102; and (5) some of the images are part of registrations secured more than five

years after the works were first published and are therefore not entitled to a presumption of

validity under 17 U.S.C. § 410(c). Thus, for all of these reasons, Imageline cannot, in good faith,

assert a claim for copyright infringement and Defendants’ public statements suggesting that

Bernina has engaged in willful copyright infringement are false, misleading, and defamatory.

B. Tortious Interference With Existing Business Relationships or Expectancies

In order to prevail on its claim for tortious interference with a business relationship or a

prospective economic advantage under Illinois law, Bernina must show: (1) that it has valid

business relationship or expectancy of a business relationship with the dealers in the Bernina

Dealer Network; (2) that Defendants have knowledge of this relationship or expectancy; (3) that

Defendants purposefully interfered with that relationship in a manner that prevented Bernina’s

legitimate expectancy from ripening or causing a breach or termination of the relationship or

expectancy; and (4) that Bernina suffered damages resulting from Defendants’ interference.

Dowd & Dowd, Ltd. v. Gleason, 181 Ill. 2d 460, 483 (1998). Here, Bernina has shown that it is

likely to succeed on all of the elements of its claim. First, Bernina maintains an existing

contractual relationship with the dealers of the Bernina Dealer Network. Perich Dec. at ¶ 3.

Second, Defendants’ statements demonstrate they were aware of the business relationships

between Bernina and the Dealer Network. See e.g., Ex. N, 7/14/10 Letter to B. Fergemann

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(suggesting that the only reason Defendants were targeting the Bernina Dealer Network was

because Bernina had refused to meet their demands). While Bernina must prove that it suffered

damages as a result of Defendants’ conduct, Illinois law does not require that there be a complete

termination of the business relationship between Bernina and the dealers. Republic Tobacco,

L.P. v. North Atlantic Trading Co., 98-cv-4011, 1999 WL 261712, at *6 (N.D. Ill. Apr. 9, 1999)

(“Nowhere do the Illinois cases say that the interference complained of must cause a complete

termination of the entire business relationship between plaintiff and a third party.”). There is

substantial evidence that Defendants’ harassment and extortion of the dealers and defamation of

Bernina, have caused Bernina to suffer substantial damage, including, among other things,

money damages, loss of competitive position, goodwill, lost profits, and other damages. See Ex.

M, 7/2/10 C. Racine Email; see also Perich Dec. at ¶¶ 13-14. Therefore, based on the above,

Bernina has shown a likelihood of succeeding on the merits of its tortious interference claim.

II. Bernina Has No Adequate Remedy At Law And Will Suffer Irreparable Harm If
Preliminary Relief Is Denied

Bernina’s injuries, including damage to business reputation and loss of goodwill, are

presumed irreparable because “it is virtually impossible to ascertain the precise economic

consequences of intangible harms.” Abbott Labs. v. Mead Johnson & Co., 971 F.2d 6, 16 (7th

Cir. 1992). It is also difficult for a court to project the long-term injurious effects of Defendants’

actions, which may influence its dealers and its consumers’ choices for years to come. Id. at 18.

“[T]he difficulty, indeed practical impossibility, of quantifying” intangible harms such as those

at issue in this case renders ”monetary relief inadequate.” Id. at 17. A key element of that

goodwill and reputation is Bernina’s strong relationship with its dealers and it is very difficult to

quantify the irreparable injury that is being caused by Defendants’ assault on those relationships.

Therefore, as a matter of law, Bernina is presumed to be suffering irreparable harm, the nature,

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extent, and long-term consequences of which are difficult to ascertain, measure, or predict. Id. at

16; see also Gateway Eastern Ry. Co. v. Terminal R.R. Ass’n of St. Louis, 35 F.3d 1134, 1140-41

(7th Cir. 1994) (holding that loss of goodwill is an irreparable harm).

III. The Balance Of The Harms Weighs Strongly In Favor Of Bernina

The balance of harms weighs in Bernina’s favor. The Seventh Circuit employs a “sliding

scale approach” where “the more likely [it is that] the plaintiff will succeed on the merits, the

less the balance of irreparable harms need favor the plaintiff’s position.” Ty, Inc., 237 F.3d at

895. The court considers and weighs all of these factors as if it were “‘sitting as would a

chancellor in equity,’ when it decides whether to grant the injunction.” Id. (quoting in part

Abbott Labs., 971 F.2d at 12). Where the party seeking the preliminary relief has demonstrated a

strong likelihood of succeeding on the merits, it need not make a similarly strong showing in the

equitable balance of hardship. See Abbott Labs., 971 F.2d at 12.

While Bernina is suffering irreparable damage to its business reputation, goodwill, and

sales, Defendants will suffer no harm by being required to cease their abusive and tortious

behavior. Imageline produces no tangible products of its own and even if it did, its business

would in no way be damaged by being prohibited from continuing to engage in these unlawful

shakedown efforts as Defendants have made their position abundantly clear to the Bernina

Dealer Network. However, even if this Court were to conclude that the balance of equitable

harms is similar, Bernina has demonstrated a strong likelihood of succeeding on the merits; thus,

it need not make a similarly strong showing in the equitable balance of hardship.

IV. The Public Interest Would Be Served By The Granting Of A Preliminary Injunction

The impact on the public must also be factored into the balance of harms. Abbott Lab.,

971 F.2d at 12. The public interest is being harmed by Defendants’ false and misleading claims

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of copyright infringement. Paisola, 461 F. Supp. 2d at 680 (stating that “a TRO prohibiting

defendants from continuing to publish this false statement is not against the public interest”). As

discussed above, there is no incidental harm that would accompany a prohibition on the

publication of these statements. An injunction is appropriate even to the limited extent that

Defendants’ statements implicate the First Amendment. An injunction may be granted limiting

speech, if it is “no more burdensome to the defendant than necessary to provide complete relief

to the plaintiffs.” Kraft Food Holdings, Inc. v. Helm, 205 F. Supp. 2d 942, 945 (N.D. Ill. 2002).

In this case, Bernina is not seeking to entirely foreclose Defendants’ opinions, rather it seeks to

curtail the spreading of false and defamatory information that is harmful to Bernina’s reputation

and goodwill. Commercial speech, which has been defined as “expression related solely to

economic interest of the speaker and its evidence” or “speech that proposes a business

transaction” may be enjoined by this Court if it is “false, deceptive, or misleading.” U.S. v.

Kaun, 827 F.2d 1144, 1152 (7th Cir. 1987). Here Bernina has shown that Defendants’

statements are false and misleading and that they are harmful to Bernina. The public interest

would not be harmed by an injunction preventing this tortious conduct.

Conclusion

Because Bernina has demonstrated a likelihood of success on the merits of its claims and

because it is and will continue to be immediately and irreparably harmed by Defendants’

continued defamation and interference with the Bernina Dealer Network, Bernina respectfully

requests that its motion for temporary restraining order and preliminary injunction be granted in

all respects.

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Date: August 5, 2010 Respectfully submitted,

BERNINA OF AMERICA, INC.

By: __/s/ Norman K. Beck_____________

Norman K. Beck (ARDC 2425205)

Brian D. Fergemann (ARDC 6269728)
Marc H. Trachtenberg (ARDC 6290927)
Kevin P. McCormick (ARDC 6294455)
Winston & Strawn LLP
35 W. Wacker Drive
Chicago, IL 60601
(312) 558-5600
nbeck@winston.com
bfergemann@winston.com
mtrachtenberg@winston.com
kmccormick@winston.com

Attorneys for Bernina of America, Inc.

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CERTIFICATE OF SERVICE

The undersigned, an attorney, hereby certifies that a copy of the foregoing

MEMORANDUM IN SUPPORT OF PLAINTIFF BERNINA OF AMERICA, INC.’S MOTION
FOR TEMPORARY RESTRAINING ORDER AND PRELIMINARY INJUNCTION was
served on:

Imageline Incorporated
Registered Agent: George P. Riddick III
202 England Street Ste A
Ashland, VA 23005-0000
griddick@imageline2.com
Copyrights@imageline2.com
info@imageline2.com

Islandview Technologies, LLC

Registered Agent: George P. Riddick III
202 England Street Ste A
Ashland, VA 23005-0000

Islandview Designs, LLC

Registered Agent: George P. Riddick III
202 England Street Ste A
Ashland, VA 23005-0000

George Paine Riddick III

164 Carriage Point Lane
Glen Allen, VA 23059-7466

Islandview Technologies and Imageline Inc.

2012 Hollywood Boulevard
Suite D
Hollywood, Florida 33020
(804) 368-8721 – fax
griddick@islandview2.com

via electronic mail, facsimile, and Federal Express Overnight Mail this August 5, 2010.

By: /s/ Brian D. Fergemann

One of The Attorneys for Plaintiff

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