In what is being characterized as a David-versus-Goliath case, a Texas appellate court has upheld a decision to prevent Premier Pools Management Corp. from working under its name in the Dallas area.
“At the end of the day, the most important thing is the courts recognizing that [the plaintiff] has a right to the name and that nobody else can come in and infringe on their work,” said Bryan Rose, of the Dallas firm Rose Walker, who represented the plaintiff, Premier Pools, based in Lewisville, Texas.
PPMC is currently weighing its options and maintains its right to operate under the Premier moniker in the Dallas/Fort Worth Metroplex. “We have to exhaust every legal remedy and every option we have,” said PPMC President/CEO Paul Porter. “But we will continue business one way or another. It didn’t go the way that we thought it would, so now we’re retrenching and trying to figure out our strategy...”
Before adopting a franchise model, Porter started a company called Premier Pools Management Corp., which granted licenses to use its name. A handful of operations remain on as licensees, including the location addressed in the lawsuit. Porter later started Premier Franchise Management, which is a separate company and was not named in the lawsuit.
In 2013, PPMC was sued by another company called Premier Pools, which accused the larger firm of trade name and service mark infringement, as well as unfair competition.
In 2011, the national firm had signed a licensee in the Dallas-Fort Worth Metroplex, which called itself Premier Pools and Spas. But the plaintiffs, Sean, Peter and Thomas Dodd, are based about 25 miles away in Lewisville and said they had been operating as Premier Pools in the north Texas market since 1989. They said the licensee was causing confusion among local consumers, resulting in lost revenue.
At the time of the lawsuit’s filing, they claimed approximately $500,000 in lost earnings. They even said that the licenseee hurt the Dodds’ reputation by making mistakes that consumers and government officials mistakenly associated with the Dodds' company.
The licenser filed a countersuit to cancel the Dodds’ registration of the name Premier Pools, saying the word “premier” is a relatively generic, or descriptive, term, and that the Dodds had not achieved the status of a company such as Apple, in which targeted consumers immediately associate the brand name with the company.
The following year, the first jury found in favor of the Dodds
The national licenser appealed the decision, but the Court of Appeals in Texas’ Fifth District upheld it. The higher court did, however, turn down the plaintiff's request to collect attorneys fees from the licenser.
Porter maintains that the Dodds’ company has not achieved what’s called secondary meaning, where consumers automatically associate the term “premier" with the builder, when in the context of the pool and spa industry. He said the Dodds only build 10 to 20 pools a year, and that such a small outfit should not own the word “premier” in a market of 6.6 million consumers and 10,000 square miles. “In some markets, some counties, they haven’t done one pool in 20 years, and they’re trying to keep us out of it,” he said.
Rose, on the other hand, said that the court has reaffirmed its contention -- that the company was there first and, therefore, is entitled to market under its name without another Premier in the area. While it hasn't done business in some counties, he said, the Dodds are entitled to keep its registration in those areas to allow for natural expansion. "A [newer company] can’t claim, ‘Well, you didn’t go here, so I’m here first,'" he said.
At this point, Porter and Premier Pools Management Corp. can request a rehearing by the appellate court or take the case up to the Texas Supreme Court.
Rose said he doesn’t see the case going further. “From our point of view, if you look at the way the opinion is written and the fact that they’ve made it a memorandum opinion and said all issues are settled in law, that signals to me that they’re telling the Supreme Court that there’s nothing big here, it’s all settled law,” he said.