MFIB, LLC v. IBCA, LLC

Background MFIB, LLC, a Delaware limited liability company doing business as ICON National, appealed the denial of its motion for a preliminary injunction. The motion sought to bar IBCA, LLC and its owner Allen Sands from using the trademarks ICON, ICON Builders, and THE ORIGINAL ICON BUILDERS. Sands had used the ICON Marks in connection with general contracting services since 1985 across multiple states. In 2017, Sands merged one of his businesses with MFRG Construction to form MFIB, but the agreement permitted the continued use of the marks in other projects. After Sands dissolved that entity and founded IBCA, LLC in 2023, IBCA undertook affordable housing projects using the ICON Marks in California and Texas. MFIB sued for trademark infringement in 2025. The court’s reasoning The court reviewed the district court’s order for abuse of discretion. To succeed on an infringement claim, MFIB needed to show senior rights to the disputed trademarks. The court found that the defendants engaged in continuous use of the ICON Marks before MFIB registered its marks, establishing senior rights. The critical issue was whether the defendants could establish prior use through privity with Sands’s other businesses. The court found that privity existed because Sands owned between 50 and 100 percent of the shares, served as president with final say, and maintained a substantial identity of interest across the entities. Regarding the geographic scope, the court noted that rights deriving from prior use are frozen to areas where the mark enjoyed recognition. However, the court could not fault the district court for denying a limited injunction because MFIB’s motion sought nationwide relief and focused on abandonment rather than geographic scope. The only evidence presented regarding current use was limited to areas of prior use. The court emphasized that MFIB may still be entitled to injunctive relief in areas other than those of prior use on an appropriate showing. What it means going forward The decision affirms the denial of a broad preliminary injunction, allowing the defendants to continue using the marks in areas of prior use while leaving the door open for the plaintiff to seek more limited relief in other geographic areas.