WP Engine had their day in court docket, however it didn’t go totally of their favor, as Decide Araceli Martínez-Olguín dominated the request for a preliminary injunction was too imprecise. Nevertheless, the choose stated they have been “inclined to grant some kind of injunction.”

“That’s How You Set A Ransom”

The lawyer for plaintiff supplied new particulars about what occurred behind the scenes on the day that Matt Mullenweg went “nuclear” on WP Engine at WordCamp USA. She first defined that Mullenweg’s demand for trademark license was a sham. Then confirmed how Mullenweg did not implement his trademark declare for fifteen years.

Among the many new particulars was that Mullenweg’s demand for $32 million {dollars} was communicated in a one-page letter and that the settlement was for a seven 12 months interval that mechanically renews “basically eternally.” She then revealed new particulars of how Mullenweg selected the $32 million {dollars}, explaining that it was simply “a quantity” that Mullenweg felt WP Engine was in a position to pay.

The purpose of this a part of the plaintiff’s argument was to indicate that the royalty price that Mullenweg was asking for was not primarily based on any worth of the mark however fairly the speed was a determine that Mullenweg felt he was in a position to squeeze out of WP Engine, saying that the speed was “set in an extortionate method.”

WP Engine’s lawyer supplied this narrative of occasions:

“We all know that defendants had no proper to supply that, quote unquote, service as a result of it’s a pretext. It’s a sham. …You take a look at the report. We see that for 15 years, WP Engine was making nominative truthful use of the WordPress mark as your complete group did for 15 years with out a lot as a shoulder faucet. ‘Excuse me.’ ‘Right here’s an e-mail.’ ‘Right here’s a textual content.’ ‘Right here’s a stop and desist letter.’  Nothing.

Nothing in any way, till the morning of September twentieth once we obtain this one web page weird trademark license settlement. That’s not how trademark house owners function. That’s not the way you shield and implement your mark. You don’t wait 15 years after which drop a requirement for thirty two million {dollars} on the recipient.

We additionally know from the value set, …this one web page license listed a worth of eight p.c of WP Engines gross revenues, which occurs to quantity to thirty two million {dollars}. And it set that worth for a seven 12 months interval to mechanically renew basically eternally.

And when requested, how did you set that worth? Mr. Mullenweg, defendant Matthew Mullenweg, acknowledged, “it’s what I assumed they might pay. We did an evaluation to determine what the free money circulate was. That’s how we set that quantity.” That’s not the way you calculate a royalty. That’s the way you set a ransom.”

Decide Questioned WP Engine’s Attorneys

There was some extent within the proceedings the place the Decide Araceli Martínez-Olguín requested WP Engine’s attorneys what proper to continued acces did they’ve with out paying any type of license.

WP Engine’s lawyer answered:

“So there’s simply merely no connection there, your Honor, in any way. The take a look at isn’t: does WP Engine have a proper to be free from a trademark license?”

The lawyer additionally identified that free entry to WordPress.org was the “establishment” for fifteen years, which modified on September twentieth when Mullenweg initiated his dispute with WP Engine.

Automattic’s Protection Tactic

The lawyer for Automattic and Mullenweg argued a number of technical factors as to why the choose mustn’t grant an injunction. One key level was that WP Engine’s extortion declare, underneath California legislation, fails as a result of California courts don’t acknowledge a non-public explanation for motion for tried extortion underneath the California Penal Code.

They then level out that the case legislation WP Engine’s lawyer is counting on (Tran v. Winn) considerations a distinct authorized idea (duress and rescission) fairly than extortion. They stated that the plaintiff’s authorized idea doesn’t match extortion claims and includes totally different authorized ideas.

Automattic’s lawyer then follows that up by stating that even when WP Engine might use the Tran v. Winn case legislation, the plaintiff’s argument nonetheless fails underneath the opposite case legislation they’re citing to base their claims on (Levitt case). They argue that the plaintiff can not meet the authorized customary for financial extortion as a result of they’re unable to indicate that the defendant had no proper to demand fee for the providers in query.

An argument made by Automattic’s lawyer in regards to the trademark license demand is that the plaintiffs omit a second possibility within the license, which was to supply volunteer hours equal to the fee. Shaw additionally identified that Mullenweg had made a reference to negotiating the phrases the next week, however WP Engine by no means responded to his message.

The lawyer stated:

“…there’s a textual content from Mr. Mullenweg during which he says, or he makes reference to even negotiating the phrases the next week. They only by no means responded to Mr. Mullenweg’s response.”

What The Decide Stated

Decide Araceli Martínez-Olguín had so much to untangle, with maybe the primary factor being that WP Engine’s injunction was too imprecise.

The choose gave a sign of what path she was leaning but additionally defined that the request was a “non-starter.”

“Having reviewed all the pieces, I’m inclined to grant some kind of injunction. Right here’s the issue that I’ve along with your proposed injunction, although. It is a nonstarter as a result of it’s exceedingly imprecise.”

The choose then inspired the events to work collectively to slim down the preliminary injunction to one thing that isn’t imprecise and failing that they might submit “dueling submissions.” There was some forwards and backwards about what date to return to court docket with, with WP Engine asking for a Friday date and ultimately agreeing to return on Tuesday, December third.

Response To Preliminary Injunction Listening to

A lawyer reside running a blog the proceedings on Bluesky wrote up their take on what occurred:

“I knew that WPE was in superb form when the opening query was “inform me about your one greatest shot” as a result of that’s not typically a query you’d ask should you thought nothing had any advantage.

I assumed that tortious interference was the very best shot. I’m fairly positive WordPress’s attorneys did too.”

And adopted up with:

“I used to be moderately positive that this was leaning towards a grant on the PI. I believe that Automattic was near getting their various, however Mack could have saved issues together with his tech stroll by.”

He supplied opinion in regards to the choose, saying that she seems to acknowledge that among the technical points are outdoors of her space of experience and that she expressed a willingness to ask questions to raised perceive.

He supplied his opinion in regards to the choose and the ultimate consequence:

“It’s clear that the Decide isn’t overly technical in her background, however is conscious of that and is prepared to hear attentively – this is excellent, and never a common federal choose trait.

Will probably be attention-grabbing to see what we get on Monday.

Nearly actually, dueling proposals.”

This abstract of what occurred in court docket relies on a reside weblog and a submit on Bluesky by a lawyer of the proceedings over Zoom.

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