LORILLARD TOBACCO COMPANY a Delaware corporation v. BISAN FOOD CORP. d/b/a NEW WAY SUPERMARKET, ALI SAYAM, HAMED SAYAM, SAMMY J. ABDUL…

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PRECEDENTIAL
IN THE UNITED STATES COURT OF
APPEALS
FOR THE THIRD CIRCUIT
_______________
NO. 03-3151
LORILLARD TOBACCO COMPANY
a Delaware corporation,
Appellant
v.
BISAN FOOD CORP. d/b/a NEW WAY
SUPERMARKET,
ALI SAYAM, HAMED SAYAM,
SAMMY J. ABDUL
______________________
NO. 03-3160
LORILLARD TOBACCO COMPANY
a Delaware corporation,
Appellant
v.
EDWIN LIQUOR STORE;
ANNA RODRIGUEZ
______________________
NO. 03-3161
LORILLARD TOBACCO COMPANY
a Delaware corporation,
Appellant
v.
JOHN DOE CORP. d/b/a
KRAUSZER’S;
SUBHASH PATEL
_______________________________
On Appeal From The United States
District Court For The District Of New
Jersey
(D.C. Nos. 03-cv-03445, 03-cv-02132,
03-cv-02807)
Honorable Katharine S. Hayden, District
Judge
_______________________________
Argued June 15, 2004
Before: ALITO, SMITH and BECKER,
Circuit Judges.
(Filed July 28, 2004)
ERIC S. ARONSON (ARGUED)
Greenberg Traurig
200 Campus Drive
P.O. Box 677
Florham Park, NJ 07932
Attorney for Appellant
________________________
OPINION OF THE COURT
________________________

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BECKER, Circuit Judge.
This case concerns a District Court’s
refusal to issue, at the behest of cigarette
manufacturer Lorillard Tobacco Co.
(“Lorillard”), ex parte orders directing the
seizure from three New Jersey retailers
(collectively, the “defendants”) of allegedly
counterfeit Newport brand cigarettes, under
the Trademark Counterfeiting Act of 1984
(the “Act”), Pub. L. No. 98-473, Title II, ch.
XV, 98 Stat. 2178, codified in relevant part at
15 U.S.C. § 1116(d). In ruling on Lorillard’s
applications for ex parte seizure, the District
Court declined to find, pursuant to 15 U.S.C.
§ 1116(d), either that (1) “an order other than
an ex parte seizure order is not adequate to
achieve the purposes of section 1114 [relating
to counterfeited trademarks],” or (2) the
defendants or their associates “would destroy,
move, hide, or otherwise make [the
counterfeit] matter inaccessible to the court,
if [Lorillard] were to proceed on notice.”
Accordingly, the District Court refused to
issue the requested seizure orders, and for two
of the defendants issued broad temporary
restraining orders (TROs), one of which is
rescribed infra note 2. Finding that the
District Court correctly interpreted § 1114(d),
that its factual findings are not clearly
erroneous, and that it did not abuse its
discretion, we will affirm.
I. Facts and Procedural History
Lorillard is the holder of several registered
trademarks affiliated with the Newport brand
of mentholated cigarettes. As the number one
brand of menthol cigarettes (and the
overall number two brand) in the United
States, the Newport brand has become a
target of counterfeit cigarette makers. This
is a consolidated appeal of three cases
against three different defendants who
allegedly dealt in these counterfeit
Newport cigarettes. Each of the cases was
pursued separately in the District Court,
though all three were heard by the same
District Judge. The cases are, in every
relevant sense, indistinguishable, and the
record in one case (against Edwin Liquor
Store) establishes the reasons for the
District Court’s refusal to issue the ex
parte seizure orders requested in all three
cases. For the sake of completeness, we
will briefly describe the procedural history
of the other cases as well.
A. Edwin Liquor Store
Edwin Liquor Store (“Edwin”) is a
retail liquor store located in a residential
neighborhood in Newark, New Jersey. On
April 10, 2003, a Lorillard sales
representative, charged with, inter alia,
ensuring that fresh Lorillard cigarettes are
available for sale at retailers, discovered
what he believed to be stale Newport
products based on product codes imprinted
on the packages at Edwin. He removed
four packs of cigarettes from the shelves,
and replaced them with fresh product.
Upon closer examination, the stale
prod ucts were determined to be
counterfeits. They also either lacked valid
state tobacco tax stamps or were
improperly stamped under state law.
Lorillard commenced this suit on May

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12, 2003, by filing a complaint and making an
emergency ex parte application for a seizure
order and a TRO, and seeking a preliminary
injunction. Though it agreed with Lorillard at
oral argument that many of the statutory
requirements for ex parte seizure had been
met, the District Court declined to find that
“Defendants, or other persons acting in
concert with the defendants, may destroy,
move, hide, or otherwise make the
merchandise bearing a counterfeit of the
Lorillard Marks inaccessible to the Court if
Lorillard were to proceed on notice to
Defendants,” or that “[e]ntry of an order other
than an ex parte seizure order will not
adequately achieve the purposes of 15 U.S.C.
§ 1114 to preserve to Lorillard its remedies
for trademark infringement.”1 The Court did,
1In full, the statute at issue reads:
(4) The court shall not grant
such an application [for ex
parte seizure] unless—
(A) the person obtaining an
order under this subsection
provides the security
determined adequate by the
court for the payment of such
damages as any person may
be entitled to recover as a
result of a wrongful seizure or
wrongful attempted seizure
under this subsection; and
(B) the court finds that it
clearly appears from specific
facts that—
(i) an order other than an
ex parte seizure order is not
adequate to achieve the
purposes of section 1114 of
this title;
(ii) the applicant has not
publicized the requested
seizure;
(iii) the applicant is likely to
succeed in showing that the
person against whom seizure
would be ordered used a
counterfeit mark in connection
with the sale, offering for sale, or
distribution of goods or services;
(iv) an immediate and irreparable
injury will occur if such seizure is
not ordered;
(v) the matter to be seized will be
located at the place identified in
the application;
(vi) the harm to the applicant of
denying the application outweighs
the harm to the legitimate interests
of the person against whom
seizure would be ordered of
granting the application; and
(vii) the person against
whom seizure would be
ordered, or persons acting
in concert with such
person, would destroy,

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however, grant a broad TRO pending a
preliminary injunction hearing. The TRO
directed Edwin to cease dealing in counterfeit
Lorillard products and preserve the goods in
question, along with all materials, packaging,
documents, and business records related to
any goods bearing genuine or counterfeit
Lorillard marks.2
move, hide, or
otherwise make such
matter inaccessible to
the court, if the
applicant were to
proceed on notice to
such person.
15 U.S.C. § 1116(d)(4).
2In full, Edwin and its proprietor, Anna
Rodriguez, “and any of their officers, agents
servants, employees, and attorneys and
those persons in active concert or
participation with them who receive actual
notice of this Order by personal service or
otherwise” (collectively referred to as
“Defendants” here and in the District
Court’s order) were temporarily restrained
from “directly or indirectly”:
(i) Using any reproduction,
counterfeit, copy, or colorable
imitation of the Lorillard
Marks in connection with the
importation, sale, offering for
sale, or distribution of
cigarettes in the United States;
(ii) using the Lorillard Marks
or any reproduction,
counterfeit, copy, or
colorable imitation of the
same in any manner likely
to cause others to believe
that defendants’ products
are connected with
Lorillard or are genuine
Lorillard products if they
are not;
(iii) passing off, inducing,
or enabling others to sell or
pass off any merchandise
which is not genuine
Lorillard merchandise as
and for genuine Lorillard
merchandise;
(iv) making any false or
misleading statements
regarding Lorillard or its
respective goods, or the
relationship between
Lorillard, on the one hand,
and Defendants, on the
other hand;
(v) committing any other
acts calculated to cause
purchasers to believe the
Defendants’ products are
Lorillard products;
(vi) importing, shipping,
delivering, distributing,
holding for sale, returning,
transferring, or otherwise
moving or disposing of in

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The Court explained its refusal to issue
the ex parte seizure order at oral argument:
I am constrained to conclude that
Lorillard has failed to make the
requisite showing that no other
method of preserving a state of
affairs on which a court can
provide effective final relief exists.
And this is the sole method, this
seizure order, this ex parte seizure
order is the sole method.
There is no showing of prior
disobedience or destruction of
evidence on the part of Edwin
Liquor Store or its owner, its
registered owner Anna Rodriguez.
There is an assertion by Lorillard of
the opportunity to destroy evidence,
but that is based upon Lorillard’s
assertions and not based upon a
showing of this particular, to this
particular entity. Nor did I hear
from [counsel for Lorillard], who
has been candid and forthright and
clearly experienced in this area, that
other merchants with which Edwin
Liquors might reasonably be
combined [sic; compared?] have
destroyed evidence in the past.
Merely that there is the opportunity
to do so.
The District Court continued:
any manner such
cigarettes falsely
bearing one or more
of the Lorillard Marks or any
reproduction, counterfeit,
copy or colorable imitation of
the same; and
(vii) assisting, aiding, or
abetting any other person or
business entity in engaging or
performing any of the
activities referred to in the
above paragraphs (i) through
(vi);
The defendants were further
restrained from “selling, moving or
otherwise disposing of any goods, boxes,
labels, packaging or product bearing the
Lorillard marks; . . . . [or] other than
pursuant to a discovery instrument
propounded by Lorillard or an order of this
Court, moving, destroying, or otherwise
disposing of any goods, boxes, labels,
packaging or other items or documents
bearing any reproduction, counterfeit, or
imitation of the Lorillard Marks[; or]
removing, destroying or otherwise disposing
of any business records or documents
relating in any way to the manufacture,
importation, acquisition, purchase,
distribution, or sale of goods or
merchandise bearing any of the Lorillard
Marks or any reproduction, counterfeit or
imitation thereof.” Finally, the Defendants
were ordered to “allow[] a Lorillard
representative to inspect all goods, boxes,
labels, products, etc. bearing the
Lorillard marks to determine their
authenticity.”

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I do not find that an order other than a
seizure order is not adequate to
provide final and effective relief to
Lorillard. . . . I do not find that there
has been any showing that the person
against whom the seizure is to be
ordered, “would destroy, move, hide,
or otherwise make such matter
inaccessible to the court” if notice
were given, other than the assertion
that there exists the opportunity for
such. . . . [I]t is really a failure to
demonstrate, number one, of §
1116(d)(4)(B) that an order other than
a seizure order is not adequate. And
number seven, that the person against
whom seizure would be ordered would
destroy, move, hide, or otherwise
make such matter inaccessible to the
court if notice were given. And
therefore, I am denying the application
for a seizure order.
In short, the Court concluded that “more than
anything else, the statute contains rock solid
requirements that I find are not met here.”
Lorillard filed a notice of appeal, and moved
to proceed ex parte on appeal, that is, without
giving Edwin notice of the appeal. The Court
denied Lorillard’s motion.
B. John Doe Corp. (Krauszer’s)
John Doe Corp. (“Krauszer’s”) is a retail
grocery store located in Wallington, New
Jersey. On May 28, 2003, a (different)
Lorillard sales representative discovered at
Krauszer’s what he believed to be stale
Newport products, again based on product
codes imprinted on the packages. Five packs
of cigarettes were removed from the shelves,
and replaced with fresh product. As with
the packs taken from Edwin, the stale
prod ucts t u r n ed out, on close r
examination, to be counterfeit and lacking
valid tax stamps or improperly stamped
under state law.
Lorillard commenced suit on June 12,
2003, again by filing a complaint and
making an emergency ex parte application
for a seizure order and a TRO, and seeking
a preliminary injunction. As with the
Edwin case, the District Court agreed that
some statutory factors were met, but again
declined to find that “Defendants, or other
persons acting in concert with the
defendants may destroy, move, hide, or
otherwise make the merchandise bearing a
counterfeit of the Lorillard Marks
inaccessible to the Court if Lorillard were
to proceed on notice to Defendants,” or
that “[e]ntry of an order other than an ex
parte seizure order will not adequately
achieve the purposes of 15 U.S.C. § 1114
to preserve to Lorillard its remedies for
trademark infringement.”
Although the District Court did not
hear oral argument in the Krauszer’s case,
as it had in the Edwin case, the order it
entered in the Krauszer’s case—which
granted a TRO similar to the one issued in
the Edwin case, but refused ex parte
seizure—explained that its ruling was
“consistent with its analysis of the
applicable statutory and case law set forth
in its bench ruling on May 13, 2003 in the
case of Lorillard Tobacco Co. v. Edwin
Liquors [sic], Docket No. 03-2131.” We
understand this to mean that the District
Court declined, as it had in the Edwin

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case, to make the factual findings necessary
under the statute to issue an ex parte seizure
order. While this appeal has been pending,
the parties have voluntarily dismissed the
action as settled.
C. Bisan Food Corp.
Bisan Food Corp d/b/a New Way
Supermarket (“Bisan”) is an independent
retail grocery store located in Union City,
New Jersey. On June 26, 2003, the same
Lorillard sales representative that serviced
Edwin, again acting on product codes,
discovered what he believed to be stale
Newport products at New Way Supermarket.
Ten packs of cigarettes were removed from
the shelves and replaced with fresh product.
As in the other two cases, closer examination
revealed counterfeit goods that were
improperly stamped under state law or
without valid tax stamps.
Lorillard commenced this suit on July 23,
2003, again by filing a complaint and making
an emergency ex parte application for a
seizure order and a TRO, and seeking a
preliminary injunction. The District Court,
having by this time adjudicated the Edwin
and Krauszer’s matters, in which Lorillard
had “rel[ied] on virtually identical arguments,
briefs, and supporting certifications,”
determined that “a prompt appearance by both
sides is of assistance to the Court in
evaluating the extent of relief to which
plaintiff is entitled.” Thus the District Court
did not issue a TRO, and directed Lorillard to
proceed against Bisan on notice (i.e., by
serving a summons and complaint upon Bisan
pursuant to Fed. R. Civ. P. 4). Lorillard filed
a notice of appeal from the denial of the ex
parte seizure order, and asked this Court
for a stay of the District Court’s order to
proceed against Bisan on notice. We
denied the stay, and Lorillard subsequently
withdrew its request for an ex parte TRO
against Bisan, so as to avoid giving them
notice of the litigation before the District
Court. Lorillard has since served Bisan
with certain materials (its brief and
appendices) in connection with the present
appeal.
II. Jurisdiction
We have an independent obligation at
the threshold to examine whether we have
appellate jurisdiction. Gov’t of V.I. v.
Hodge, 359 F.3d 312, 317 (3d Cir. 2004);
Vuitton v. White, 945 F.2d 569, 571 (3d
Cir. 1991). In Vuitton, we held that we
have statutory appellate jurisdiction under
28 U.S.C. § 1292(a)(1) over interlocutory
appeals from orders denying ex parte
seizure. 945 F.2d at 571-74; but see In re
Lorillard Tobacco Co., 370 F.3d 982 (9th
Cir. 2004) (holding that the denial of an ex
parte seizure order is not immediately
appealable). We are, of course, bound by
Vuitton here. See Third Circuit IOP 9.1
(“Policy of Avoiding Intra-Circuit Conflict
of Precedent”). In Vuitton, we also noted
that the apparent mootness of the dispute
did not deprive us of Article III
jurisdiction. “Now that notice has been
given, a seizure order cannot be granted ex
parte and may well be ineffective.
Nevertheless, we agree with Vuitton that
while this case might otherwise be moot, it
falls within the exception from the

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mootness doctrine for cases ‘capable of
repetition, yet evading review.’” Vuitton, 945
F.2d at 571 n.1 (quoting Weinstein v.
Bradford, 423 U.S. 147, 149 (1975)).
Though we did not discuss the point at
length in Vuitton, one could argue that the
history of the relationship between the parties
there was critical to our conclusion that the
dispute was “capable of repetition”: Vuitton,
a designer of high quality handbags and
luggage, had repeatedly pursued the same
defendants, street vendors of counterfeit
Vuitton merchandise. See Vuitton, 945 F.2d
at 570. There is no such prior history
between Lorillard and any of the
defendants—Lorillard does not allege that,
prior to the events at issue here, it knew or
even suspected any of the defendants of
dealing in counterfeit cigarettes—and
consequently, we have no basis to suspect
that this dispute is likely to be repeated
among these same parties.
In the present ex parte procedural posture,
however, what matters with respect to
mootness is whether the party seeking the
order can demonstrate that it is likely to
request such orders in the future against
some defendant (not necessarily the same
defendant). At bottom,“capable of repetition,
yet evading review” is a pragmatic exception
that tempers the mootness doctrine in
situations where denial of appellate review
works a hardship on the parties. When there
is only one party exposed to such
hardship—the party seeking the ex parte
order—it seems needlessly inflexible to say
that that party must demonstrate that it will
again confront the same defendants. Lorillard
has amply demonstrated that cigarette
counterfeiting is a serious and widespread
problem for it; for example, Lorillard
represents that by the beginning of 2004 it
had filed, in the District of New Jersey
alone, some sixteen different complaints
against different defendants seeking ex
parte seizure relief. Thus we conclude that
the appeals fall within the “capable of
repetition, yet evading review” exception
to mootness. See Globe Newspaper Co. v.
Superior Court, 457 U.S. 596, 602-03
(1982); Praxis Props., Inc. v. Colonial
Sav. Bank, S.L.A., 947 F.2d 49, 61-62 (3d
Cir. 1991); Publicker Indus., Inc. v.
Cohen, 733 F.2d 1059, 1065-66 (3d Cir.
1984); Luther v. Molina, 627 F.2d 71, 73-
74 (7th Cir. 1980).
One final jurisdictional matter
commands our attention. As we note
above, during the pendency of this appeal,
Lorillard settled its case against
Krauszer’s. In many circumstances
settlement would moot a pending appeal.
See Local No. 8-6, Oil, Chem. & Atomic
Workers Int’l Union v. Missouri, 361 U.S.
363 (1960). This rule of thumb does not
apply, however, when a case falls within
the “capable of repetition, yet evading
review” exception to mootness. See Int’l
Union, United Auto. Workers v. Dana
Corp, 697 F.2d 718, 721 (6th Cir. 1983)
(en banc). Thus we also have jurisdiction
over the appeal in the Krauszer’s case.
III. The Merits
In Vuitton, we articulated the standard
of review over a district court’s denial of a
motion for ex parte seizure under 15

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U.S.C. § 1116(d). The standard is the same
used for review of an order granting or
denying a preliminary injunction: “We
review a district court’s ruling . . . only to
determine if there has been (1) an abuse of
discretion, (2) an error of law, or (3) a clear
mistake of fact.” Vuitton, 945 F.2d at 574
(quoting Hoxworth v. Blinder, Robinson &
Co., 903 F.2d 186, 198 (3d Cir. 1990)). Here,
the form and substance of the District Court’s
ruling places our review in the first and third
categories: Did the District Court abuse its
discretion, or were its factual findings clearly
erroneous?3
The two statutory elements at issue
here—the elements that the District Court
pointedly declined to find on the record
b e f o r e i t — a r e 1 5 U . S . C . §
1116(d)(4)(B)(i) and (vii), which require a
court issuing an ex parte seizure order to
find, respectively, that “an order other than
an ex parte seizure order is not adequate to
achieve the purposes of section 1114 of
this title” and that “the person against
whom seizure would be ordered, or
persons acting in concert with such person,
would destroy, move, hide, or otherwise
make such matter inaccessible to the court,
if the applicant were to proceed on notice
to such person.” Though not identical,
these are in effect two sides of the same
coin: “Proceed[ing] on notice” (i.e., not ex
parte) will usually entail serving the
defendant with a TRO and proceeding to
an adversary hearing on a preliminary
injunction. A finding upon emergency
application that proceeding on notice
would result in the destruction, removal, or
hiding of the counterfeit matter is arguably
tantamount to a finding that the defendant
will not comply with a TRO, which in turn
would suggest that nothing less than ex
parte seizure is required to vindicate the
trademark holder’s rights.
We pose the issue in this way because
it gets us to the fundamental factual
inquiry the District Court focused on, and
its finding that we review for clear error:
Could the defendants be trusted to comply
with the order of a Federal District Court?
Finding no evidence that the defendants
3Lorillard argues strenuously that the
District Court’s comments at oral argument
on the Senate Report accompanying the Act
led to an erroneous legal conclusion that the
Act contains a “one free bite” exception,
that is, that ex parte seizure is not available
absent a showing of prior disobedience of a
court order by the defendant. Prior
disobedience is surely highly probative of
some of the statutory elements—for
example, § 1116(d)(4)(B)(vii) requires a
determination that “the person against
whom seizure would be ordered . . . would
destroy, move, hide [etc.]” the counterfeit
matter. But there is no statutory basis for a
per se requirement that prior disobedience
be shown to obtain an ex parte seizure
order. At all events, we do not understand
the District Court to have relied on such a
legal conclusion in reaching the
determination it did; as our excerpts from
oral argument make clear, Lorillard was
ultimately denied relief on factual and
discretionary grounds, not on a legal ground.

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could not be trusted, the District Court
concluded that they could, and that they
should be presumed to be willing to abide by
a TRO. The presumption can run no other
way, for absent extenuating circumstances,
we generally do not assume that parties will
disobey a court order. Cf., e.g., Intermetal
Mexicana, S.A. v. Ins. Co. of N. Am., 866 F.2d
71, 78 (3d Cir. 1989) (“It is reasonable to
expect that a valid court order will be
obeyed.”). Moreover, fundamental fairness
dictates that presumptions generally should
not run against the absent party in an ex parte
proceeding. The Act directs the court to
consider whether the record discloses reasons
to rebut this presumption.
The District Court followed this course.
It expressly noted that “Lorillard has failed to
make the requisite showing that no other
method of preserving a state of affairs on
which a court can provide effective final
relief exists.” It observed that Lorillard could
have put in direct evidence that the
defendants had not complied with other court
orders, and stated that, on the record before it,
“there is no showing of prior disobedience or
evidence of destruction on the part of Edwin
Liquor Store or its owner, its registered owner
Anna Rodriguez.” The District Court further
suggested that Lorillard could have shown
that the defendants were comparable to other
retailers who had flouted court orders, but
again observed that, on the record before it,
Lorillard had not shown that “other merchants
with which Edwin Liquors might reasonably
be combined [sic; compared?] have destroyed
evidence in the past.”
Herein lies a critical difference between
this case and Vuitton. In Vuitton, the
defendants were street vendors who sold
counterfeit Vuitton merchandise. Even
setting aside that Vuitton had previously
secured a permanent injunction against
some of the defendants in the new action,
Vuitton, 945 F.2d at 570, the unmistakable
lesson from prior proceedings was that
these street vendors would not even appear
in court after being served, let alone
comply with a TRO, id. at 575. Moreover,
though the Vuitton Court did not discuss it,
common sense suggests that street
vendors, being itinerant and lacking
significant assets, have relatively little to
fear from the District Court’s contempt
powers.
The record before the District Court in
the cases now before us supports (though
does not compel) the opposite inferences:
First, there is no evidence that these
defendants have previously failed to
appear in court when required; indeed,
there has been no prior legal action at all
against these defendants. Second, there is
not even the suggestion that small
independent retailers with fixed places of
business are as a class unlikely to comply
with a court order. Third, these
defendants—incorporated businesses with
inventories, assets, and a fixed physical
presence—have much to lose if held in
contempt. Lorillard can point to no direct
evidence in the record to the contrary.
Especially in light of the Act’s emphatic
command that the elements supporting ex
parte seizure “clearly appear[] from
specific facts,” 15 U.S.C. § 1116(d)(4)(B),
the District Court’s factual findings were
not clearly erroneous.

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One argument from Lorillard— perhaps its
strongest—remains. The cigarettes recovered
from the defendants’ stores did not have the
state tobacco tax stamps required by New
Jersey law—the stamps were either missing
or invalid. As Lorillard points out, authentic
cigarettes distributed through legitimate
channels will have valid tax stamps, but
counterfeit cigarettes, distributed through a
black market, do not. This difference
provides part of the profit motive for retailers
to sell counterfeit cigarettes: The untaxed,
counterfeit cigarettes can be procured at a
lower cost than taxed, authentic cigarettes,
but the untaxed, counterfeit cigarettes will be
sold at the same price as the taxed, authentic
product—at the statewide mandatory
minimum price established by New Jersey’s
Unfair Cigarette Sales Act, N.J. Stat. Ann.
56:7-18 to -38.4 The defendants’ actions
seemingly expose them to the criminal
sanctions of the Unfair Cigarette Sales
Act, N.J. Stat. Ann. 56:7-20(b), in addition
to their possible federal criminal liability
under 18 U.S.C. § 2320 for trafficking in
counterfeit goods, and possible violations
of criminal laws against illegal importation
and tax evasion. This, Lorillard contends,
gives the defendants a strong incentive to
destroy or otherwise dispose of the
cigarettes if they learned (by receiving
notice of Lorillard’s civil trademark
infringement suit) that they had been
discovered.
There is much force to this argument.
The District Court, however, rejected it,
commenting that “[t]here is an assertion by
Lorillard of the opportunity to destroy
evidence, but that is based upon Lorillard’s
assertions and not based upon a showing
of this particular, to this particular entity.”
As this determination is more discretionary
and predictive than it is factual, we review
the District Court’s decision for abuse of
discretion rather than for clear error.
Though the District Court could have more
fully articulated its reluctance to accept
this particular line of argument, it did not
abuse its discretion in rejecting Lorillard’s
position, especially in light of the
otherwise weak factual record.
Two reasons support our conclusion.
First, Lorillard’s argument establishes an
incentive, but the statute requires
something more certain—for example, one
4Strictly speaking, the Unfair Cigarette
Sales Act provides a mandatory minimum
price for sales by distributors to retailers,
currently $51.03 per carton (200 cigarettes)
for distributor-delivered cigarettes, of which
$20.50 represents the tax paid by the
distributor to the state. Competition among
distributors likely stabilizes distributor sales
prices at this level, and competition among
many outlets for retail purchase of cigarettes
likely keeps retail prices at a level just
above the distributor price. The ultimate
effect is a stabilization of retail prices
within a narrow range, allowing distributors
and retailers of untaxed cigarettes to reap
the $20.50 in unpaid taxes—on top of the
difference in manufacturer price between
authentic and (presumably lower-cost)
counterfeit cigarettes. The profit margin,
and motive, are thus enormous.

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of the requirements is met only by a finding
that the defendant “would destroy, move, hide
[etc.]” the counterfeit matter. §
1116(d )(4)(B)(vii) (emphasis added).
Second, if we found an abuse of discretion
here, Lorillard’s argument would become a
per se rule that ex parte seizure must be
ordered when counterfeit cigarettes are
involved. Indeed, arguably anyone who is
intentionally selling any counterfeit goods
has—by virtue of the threat of criminal
sanction from the criminal trademark
counterfeiting statute, 18 U.S.C. § 2320—an
incentive to dispose of those counterfeit
goods. In that light, Lorillard’s incentive-
based argument could logically be extended
to cover all trademark counterfeiting, which
would render most of the specific factors of §
1116(d)(4) a nullity. We therefore must reject
Lorillard’s argument that the District Court
abused its discretion in rejecting its incentive-
based argument.
IV. Conclusion
On the face of the statute it is clear that ex
parte seizure is not to be ordered as a matter
of course. In this respect, our opinion in
Vuitton represents the extreme case, as we
expressly noted: “If we were to conclude that
a § 1116 seizure order would be inappropriate
in this case, we would be hard pressed to
image a case in which such an order would be
appropriate.” 945 F.2d 575-76. The cases
before us now are not the extreme case, and
the District Court was not required to order
an ex parte seizure. Rather, it was obliged to
scrutinize the record, which Lorillard had the
obligation to develop; to make findings; and
to exercise its sound judicial discretion.
For the foregoing reasons, we conclude
that the District Court did not commit an
error of law, make clearly erroneous
factual findings, or abuse its discretion in
refusing to issue ex parte seizure orders in
these three cases. The orders of the
District Court will therefore be affirmed.

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