In the

United States Court of Appeals
               For the Seventh Circuit

No. 08-2306

T HE N ATIONAL S PIRITUAL A SSEMBLY OF THE
B AHÁ’ÍS OF THE U NITED S TATES OF A MERICA
U NDER THE H EREDITARY G UARDIANSHIP, INC.,
                                                               Plaintiff,
                                  v.

N ATIONAL S PIRITUAL A SSEMBLY OF THE B AHÁ’ÍS
OF THE U NITED S TATES OF A MERICA , INC .,
                                       Defendant-Appellant,
                             v.

F RANKLIN D. S CHLATTER, JOEL B. M ARANGELLA,
P ROVISIONAL N ATIONAL B AHÁ’Í C OUNCIL OF THE
U NITED S TATES, et al.,
                                      Respondents-Appellees.
                         ____________
             Appeal from the United States District Court
        for the Northern District of Illinois, Eastern Division.
              No. 1:64-cv-01878—Amy J. St. Eve, Judge.
                          ____________

  A RGUED F EBRUARY 20, 2009—D ECIDED N OVEMBER 23, 2010
                          ____________
2                                                No. 08-2306

    Before B AUER, M ANION, and SYKES, Circuit Judges.
   S YKES, Circuit Judge. This appeal is from a civil-contempt
proceeding alleging violations of an injunction entered
more than four decades ago. The case is complicated not
just by the passage of time but also because it arises in the
context of a religious schism, and the individuals and
groups against whom contempt sanctions are sought were
not parties to the original litigation. The underlying suit
was a trademark and property dispute between the
American Bahá’í church—formally known as the National
Spiritual Assembly of the Bahá’ís of the United States of
America, Inc. (“National Spiritual Assembly”)—and a
dissident group incorporated in 1964 under the like-
sounding name of the National Spiritual Assembly of the
Bahá’ís of the United States of America Under the Heredi-
tary Guardianship, Inc. (“Hereditary Guardianship”). In
1966 a district-court judge enjoined the Hereditary Guard-
ianship from using the trademarked names and symbols of
the National Spiritual Assembly. Within months the
Hereditary Guardianship dissolved, and the dissenting
faithful thereafter disagreed among themselves over issues
of spiritual leadership and doctrine. This disagreement
eventually produced a second schism. Over time the
former followers of the Hereditary Guardianship estab-
lished several new religious groups and a publishing firm,
all operating in varying ways in the name of the Bahá’í
faith.
  Forty years later, the National Spiritual Assembly
returned to the district court and asked for contempt
sanctions against several of these groups and their princi-
pals for allegedly violating the terms of the 1966 injunction.
No. 08-2306                                                3

This required proof that the alleged contemnors—all
nonparties to the original lawsuit—were in privity with the
Hereditary Guardianship and therefore bound by the
injunction. In a comprehensive opinion, the district court
rejected the privity claim and on this basis denied the
contempt motion. In reaching this conclusion, the judge
expressly declined to follow the approach to the privity
question adopted by the First Circuit in G. & C. Merriam Co.
v. Webster Dictionary Co., 

(1st Cir. 1980). The
judge said that Merriam was in “silent tension” with Judge
Learned Hand’s venerable opinion in Alemite Manufactur-
ing Corp. v. Staff, 

(2d Cir. 1930).
  We think these two important opinions can be reconciled.
The common-law rule expounded in Alemite—essentially
codified in Rule 65(d) of the Federal Rules of Civil Proce-
dure—holds that an injunction is binding on the parties to
the proceeding; their officers, agents, and employees
(acting in that capacity); and nonparties with notice who
are either “legally identified” with a party or who aid and
abet a party’s violation of the injunction. The “legal
identity” component of this rule often operates to bind a
party’s successors and assigns, and sometimes other
nonparties as well, but only when doing so is consistent
with due process. As such, the “legal identity” justification
for binding nonparties is limited to those who have notice
of the injunction and are so closely identified in interest
with the enjoined party that it is reasonable to conclude
that their rights and interests were adjudicated in the
original proceeding. In Merriam the First Circuit held that
a former employee of an enjoined corporation had such a
key role in the company and in the underlying litigation
4                                               No. 08-2306

that he could be “legally identified” with the enjoined
corporation and therefore held in contempt for using a
newly formed company to circumvent the 

. This is a specific application of the “legal
identity” category of nonparty contempt identified in
Alemite; we do not read Merriam as inconsistent with Judge
Hand’s formulation.
  Although the district court should have applied Merriam,
the judge’s findings are thorough enough to permit us to
resolve the privity question without a remand. The respon-
dent nonparty religious groups and their principals are not
sufficiently identified in interest with the Hereditary
Guardianship to permit a conclusion that they had their
day in court back in 1966. We affirm.


                      I. Background
A. The Bahá’í Schism and the 1966 Injunction
  The Bahá’í faith originated in Persia in 1844 with the
teachings of the Báb, who foretold that God would soon
reveal a prophet to the world. In 1863 Bahá’u’lláh, one of
the Báb’s followers, announced that he was this prophet
and began several decades of spiritual teaching and
writing. With Bahá’u’lláh’s death in 1892, spiritual leader-
ship passed to his eldest son, Abdu’l-Bahá. Abdu’l-Bahá
died in 1921, and his eldest grandson, Shoghi Effendi, then
led the faith as its Guardian. Effendi died unexpectedly in
1957 without having clearly designated a successor.
Spiritual authority passed temporarily to the Hands of
the Cause of God, a group of 27 Effendi-appointed spiritual
leaders who stewarded the religion until 1963. At that
No. 08-2306                                                 5

point the Hands transferred supreme authority of
the Bahá’í faith to the newly established Universal House
of Justice in Haifa, Israel.
  The National Spiritual Assembly, whose predecessor
organization was formed in the United States in 1909,
recognizes and accepts this described line of succession.
Charles Mason Remey did not. Remey, one of Effendi’s
appointed Hands, proclaimed in 1960 that Effendi’s
spiritual authority had passed to him as the Second
Guardian of the Faith. The other Hands rejected this
claim, believing that Effendi was the first and last Guard-
ian of the Faith, and they expelled Remey from their ranks.
The National Spiritual Assembly likewise views Remey as
a schismatic figure.
  In 1962 Remey instructed his followers to establish the
National Spiritual Assembly of the Bahá’ís of the United
States Under the Hereditary Guardianship. The
Hereditary Guardianship was incorporated in New Mexico
in 1964, and it served as the coordinating body for
an affiliation of individuals, groups, and local spiritual
assemblies in the United States dedicated to Remey’s
Guardianship. The Hereditary Guardianship itself
was comprised of nine “Members” who essentially acted as
a board of directors and, at least initially, followed Remey’s
declarations and directives.1
  In the year of its incorporation, the Hereditary Guardian-
ship commenced a civil action against the National Spiri-



1
  For the sake of simplicity, we refer to them as “board mem-
bers.”
6                                             No. 08-2306

tual Assembly in federal court in the Northern District of
Illinois. The Hereditary Guardianship claimed entitlement
to the majestic Bahá’í House of Worship in Wilmette,
Illinois, pictured here:




and also sued for all other properties and funds in the
National Spiritual Assembly’s possession. The National
Spiritual Assembly in turn asserted counterclaims against
the Hereditary Guardianship for trademark infringement
and unfair competition, among other causes of action.
No. 08-2306                                                7

 In a decision issued on June 28, 1966, Judge Richard
Austin sided with the National Spiritual Assembly.
Among other factual findings, Judge Austin found that
    Shoghi Effendi was the only Guardian of the Baha’i
    Faith, and there is no Guardian at the present time
    and has been none since 1957. The procedures
    followed by the Hands of the Cause and the succession
    of authority from Shoghi Effendi to The Universal
    House of Justice were in full accordance with
    the controlling documents and sacred writings and
    teachings of the Faith.
Nat’l Spiritual Assembly v. Nat’l Spiritual Assembly, No.
64 C 1878, 

, at *2 (N.D. Ill. 1966). The judge
also found that the National Spiritual Assembly “is
the highest authority of the Baha’i Faith in the
continental United States, and has been recognized and
authorized as such by The Universal House of Justice and
its predecessor supreme Baha’i Faith authorities.” 

On the basis of these and other findings of fact, Judge
Austin concluded that “[t]here is only one Baha’i Faith,”
and that the National Spiritual Assembly is the “highest
authority for the Faith in [the] continental United States
and is entitled to exclusive use of the marks and symbols
of the Faith.” 

The judge went on to hold that
the National Spiritual Assembly owned valid trademarks
in several specific Bahá’í symbols, names, and
phrases—including a trademark in the word “Bahá’í”—all
of which the Hereditary Guardianship had infringed.
Judge Austin then entered the following injunction:
8                                                No. 08-2306

    IT IS ORDERED, ADJUDGED AND DECREED that the
    counter-defendant, [the Hereditary Guardianship], its
    officers, agents, servants, employees, attorneys, and all
    persons in active concert or participation with them,
    including [affiliated local groups], and individuals, or
    any of them, be and they are hereby enjoined from
    using in their activities the designations “National
    Spiritual Assembly of the Baha’is of the United States
    of America Under the Hereditary Guardianship, Inc.,”
    “Baha’i News Bureau,” “Baha’i Round Robin,”
    “Baha’i,” trademark representations of the Baha’i
    House of Worship, the Arabic design “The Greatest
    Name,” and any other designation which by colorable
    imitation or otherwise is likely to be mistaken for or
    confused with [the National Spiritual Assembly’s]
    name or marks as indicated above or is likely to create
    the erroneous impression that [the Hereditary Guard-
    ianship’s] religious activities, publications or doctrines
    originate with [the National Spiritual Assembly], and
    from otherwise competing unfairly with [the National
    Spiritual Assembly] or infringing [the National Spiri-
    tual Assembly’s] rights.

  Remey acquiesced in the injunction, and he forbade the
Hereditary Guardianship and its followers from pursuing
reconsideration or appeal “regardless of consequences.” A
few months later, in December 1966, the Hereditary
Guardianship ceased all activities and dissolved. Remey
eventually reconstituted his church and changed his title to
the “First Guardian of the Abha Faith.”
No. 08-2306                                              9

B. The Current Dispute
  In 2006 the National Spiritual Assembly returned to court
seeking contempt sanctions against five religious organiza-
tions and individuals—all remnants of the Hereditary
Guardianship but nonparties to the original litigation—for
allegedly violating the 1966 injunction. The National
Spiritual Assembly contended that the alleged contem-
nors were in privity with the Hereditary Guardianship and
therefore bound by the injunction. The named respondents
can be classified into two groups. The first includes Joel
Marangella, Frank Schlatter, and the Provisional National
Bahá’í Council of the United States, Inc. The second
includes the Second International Bahá’í Council d/b/a
Bahá’ís Under the Provisions of the Covenant (“Second
International Council”) and Bahá’í Publishers Under the
Provisions of the Covenant (“Bahá’í Publishers”). We offer
a brief description of each.


 1. The First Group of Alleged Nonparty Contemnors
  Joel Marangella was the president of a council
that functioned essentially as a liaison between Remey
and the Hereditary Guardianship. While not a
board member of the Hereditary Guardianship, Marangella
was actively involved in the organization and
participated in some aspects of the underlying litigation,
basically as a trusted assistant to Remey. A few years
after the Hereditary Guardianship dissolved, Marangella
split with Remey and forced a second schism. He pro-
claimed himself to be Remey’s appointed Third
Guardian of the Bahá’í Faith. Remey disputed Marangella’s
10                                            No. 08-2306

claim; he had already announced that upon his
death, Donald Harvey was to succeed him as the next
Guardian. Remey and M arangella thus parted
ways. Starting in 1970, Marangella organized a
succession of religious assemblies dedicated to his Guard-
ianship. The first, the National Bureau of the Orthodox
Bahá’í Faith (“National Bureau”), was established in
New York as an unincorporated body. In 1972 Marangella
moved the National Bureau to New Mexico and later
changed its name to the Mother Bahá’í Council, which
was incorporated under the laws of New Mexico in 1978.
In 2000 the Mother Bahá’í Council changed its name to
the Provisional National Bahá’í Council of the United
States, Inc. (“Provisional National Council”).
  Franklin Schlatter was a founding board member and
officer of the Hereditary Guardianship. He appears to
have been involved with the Hereditary Guardianship’s
activities to a considerable degree and was part of the
board that voted to sue the National Spiritual Assembly.
W h en the Rem ey-M arangella schism occu rred ,
Schlatter followed Marangella and served as secretary of
the Provisional National Council (and its predecessors)
from 1978 through 2001. In 1997 Marangella appointed
Schlatter as a Hand of the Cause of God to assist and act
on his behalf.
  The Provisional National Council governs all believers
within the United States who recognize Marangella as
the Third Guardian, much like Hereditary Guardianship
governed those who recognized Remey as the
Second Guardian. Marangella personally appoints all
Provisional National Council board members and
No. 08-2306                                              11

reviews and approves all decisions relating to the organiza-
tion’s activities and affairs.


  2. The Second Group of Alleged Nonparty Contemnors
  The Second International Council and Bahá’í Publishers
were created by Dr. Leland Jensen, who signed the incor-
poration papers for the Hereditary Guardianship
and served as a board member from April 1963 to May
1964. In 1964, however, Jensen lost reelection to the board,
and he thereafter disassociated himself from any formal
governance role in the Hereditary Guardianship. Accord-
ingly, he was not a board member when the Hereditary
Guardianship sued the National Spiritual Assembly,
nor did he have any role in the litigation. Dr. Jensen
continued to follow Remey’s Guardianship, however,
and when he and his wife moved to Missoula, Montana,
sometime later that year, they established a small commu-
nity of believers there.
  In 1969 Dr. Jensen formed the Bahá’í Publishers as
a publishing trust and incorporated it in Montana in
1987. Bahá’í Publishers publishes books and pamphlets on
Dr. Jensen’s interpretation of the beliefs of the Bahá’í
faith “under the Provisions of the Covenant.” Dr. Jensen
also helped establish the Second International Council
in 1991, which was incorporated two years later. The
Second International Council handles administrative
responsibilities for believers in the Bahá’í faith “under
the Provisions of the Covenant” and describes its “main
responsibility” as “giv[ing] guidance to anybody
who requests it.” Jensen died in 1996.
12                                              No. 08-2306

C. The District Court Rejects the Privity Claim
  Judge Austin had long since died by the time the Na-
tional Spiritual Assembly returned to court in 2006, so the
contempt motion was assigned to Judge Amy St. Eve. She
authorized limited discovery and then held an extensive
evidentiary hearing on the question of whether the alleged
nonparty contemnors were in privity with the Hereditary
Guardianship and thus bound by the injunction. She
concluded they were not. In reaching this decision, Judge
St. Eve declined to follow the First Circuit’s decision in
Merriam, 

, on which the National Spiritual
Assembly had substantially relied in support of its privity
claim. But she made detailed findings about the relation-
ship of each of the alleged contemnors to the Hereditary
Guardianship and/or Remey, and based on those findings,
concluded that they could not be bound. This appeal
followed.


                       II. Analysis
  The National Spiritual Assembly argues that the district
court committed legal error by rejecting the First Circuit’s
holding in Merriam that a key officer or employee of an
enjoined but later dissolved corporation can be “legally
identified” with the corporation and therefore personally
bound by the injunction. As a more general matter, the
National Spiritual Assembly challenges the district court’s
conclusion that the five nonparty alleged contemnors were
not in privity with the Hereditary Guardianship and
therefore are not bound by the 1966 injunction. We agree
with the first of these arguments. Merriam is not, as the
No. 08-2306                                                 13

district court thought, an overbroad statement of the
principles on which a nonparty may be considered bound
by an injunction. But it does not follow that the district
court’s no-privity conclusion was in error. The facts here
do not support a finding of privity even when Merriam is
considered.


A. The Effect of Presbyterian Church
  Before proceeding, a few words about the substance of
the underlying injunction and its relationship to the civil-
procedural questions at issue in this case. The injunction
was entered in 1966, before the Supreme Court’s decision
in Presbyterian Church in the United States v. Mary Elizabeth
Blue Hull Memorial Presbyterian Church, 

(1969),
but after Kedroff v. St. Nicholas Cathedral of Russian Orthodox
Church in North America, 

(1952). Kedroff
constitutionalized the general common-law principle
announced in Watson v. Jones, 80 U.S. (13 Wall.) 679 (1871),
that civil authorities may not make judgments about
religious controversies when deciding church property
disputes. 

(The church-autonomy
principle recognized in Watson “must now be said to have
federal constitutional protection as a part of the free
exercise of religion against state interference.”).
  Building on Kedroff, the Supreme Court held in Presbyte-
rian Church that “the First Amendment severely circum-
scribes the role that civil courts may play in resolving
church property 

. The Court
acknowledged that “[c]ivil courts do not inhibit [the] free
14                                                  No. 08-2306

exercise of religion merely by opening their doors to
disputes involving church property.” 

Amend-
ment values are plainly jeopardized when church property
litigation is made to turn on the resolution by civil courts
of controversies over religious doctrine and practice.” 

Amendment therefore commands civil courts
to decide church property disputes without resolving
underlying controversies over religious doctrine.” Id.; see
also Serbian E. Orthodox Diocese for the U.S. of Am. & Can. v.
Milivojevich, 

, 713 (1976) (noting “the general
rule that religious controversies are not the proper subject
of civil court inquiry”). Civil courts may decide church
property claims based on “neutral principles of law,
developed for use in all property disputes,” but have no
authority to resolve religious disputes.2 Presbyterian

.
  Considered in light of these First Amendment limitations
on the court’s authority, certain aspects of the 1966 injunc-
tion are troubling. The decree declares that “there is only
one Baha’i Faith,” that Shoghi Effendi was its last Guardian
and none has come since, and the National Spiritual
Assembly was its representative and “highest authority” in
the United States and was “entitled to exclusive use of the


2
  For different views on the so-called “hands-off” doctrine in
disputes over religious property, see Richard W. Garnett, A
Hands-Off Approach to Religious Doctrine: What Are We Talking
About?, 84 N OTRE D AME L. R EV . 837 (2009); Kent Greenawalt,
Hands Off! Civil Court Involvement in Conflicts Over Religious
Property, 98 C OLUM . L. R EV . 1843 (1998); Samuel J. Levine,
Rethinking the Supreme Court’s Hands-Off Approach to Questions of
Religious Practice and Belief, 25 F ORDHAM U RB . L.J. 85 (1997).
No. 08-2306                                                 15

marks and symbols of the Faith,” including the exclusive
use of the word “Bahá’í.” Declarations of this sort push the
boundaries of the court’s authority under Kedroff and
Presbyterian Church. In church property disputes (trade-
mark suits obviously qualify), the First Amendment limits
the sphere in which civil courts may operate. When a
district judge takes sides in a religious schism, purports to
decide matters of spiritual succession, and excludes
dissenters from using the name, symbols, and marks of the
faith (as distinct from the name and marks of a church), the
First Amendment line appears to have been crossed.
  But a contempt proceeding is ordinarily not the proper
place for collateral attacks on the underlying injunction. See
Pasadena City Bd. of Educ. v. Spangler, 

, 439-40
(1976); Walker v. City of Birmingham, 

(1967);
Reich v. Sea Sprite Boat Co., 

, 415 (7th Cir. 1995);
see also 11A C HARLES A LAN W RIGHT ET AL., F EDERAL P RAC-
TICE AND P ROCEDURE § 2960, at 391 (2d ed. 1995) (“[T]he
general principle appears to be that obedience to a decree
is required, even though the issuing court has based its
decision on an incorrect view of the law, unless there was
no opportunity for effective review of the decree.”). We do
not have the substance of the 44-year-old decree before us.
Still, resolving the procedural questions at issue in this case
requires some sensitivity to the constitutional concerns
inherent in church property claims. Presbyterian Church is
in the background and circumscribes the inquiry. Applying
neutral privity principles is permissible; pronouncing on
matters of religious succession is not.
16                                               No. 08-2306

B. Standard of Review
  We review the district court’s denial of contempt sanc-
tions for abuse of discretion. Autotech Techs. LP v. Integral
Research & Dev. Corp., 

, 751 (7th Cir. 2007);
Stotler & Co. v. Able, 

(7th Cir. 1989). A court
abuses its discretion when it bases its decision on a legal
error or on clearly erroneous factual findings. United States
v. Silva, 

, 1101 n.4 (7th Cir. 1998); In re L & S
Indus., Inc., 

, 932 (7th Cir. 1993) (similar
standard of review for district court’s determination of
existence of privity); see Cooter & Gell v. Hartmarx Corp.,

, 401 (1990) (noting abuse-of-discretion stan-
dard of review is equivalent to clear-error standard of
review when reviewing a district court’s factual findings).
Factual findings are not clearly erroneous unless “ ’the
reviewing court on the entire evidence is left with the
definite and firm conviction that a mistake has been
committed.’ ” Anderson v. City of Bessemer City, 

,
573 (1985) (quoting United States v. U.S. Gypsum Co., 

, 394-95 (1948)).
  As the proponent of the contempt motion, the National
Spiritual Assembly had the following burden:
     To prevail on a request for a contempt finding, the
     moving party must establish by clear and convincing
     evidence that (1) a court order sets forth an unambigu-
     ous command; (2) the alleged contemnor violated that
     command; (3) the violation was significant, meaning
     the alleged contemnor did not substantially comply
     with the order; and (4) the alleged contemnor failed to
     make a reasonable and diligent effort to comply.
No. 08-2306                                                  17

S.E.C. v. Hyatt, 

, 692 (7th Cir. 2010). In addition,
the National Spiritual Assembly had the burden of estab-
lishing that the alleged contemnors, nonparties to the 1966
injunction, are nonetheless bound by it. See Levin v. Tiber
Holding Corp., 

, 250-51 (2d Cir. 2002) (applying
the clear-and-convincing standard to the question of a
nonparty’s liability for contempt).


C. Injunctions and Nonparties
   This appeal raises the question of the proper reach of an
injunction—more specifically, the extent to which an
injunction binds persons who are not parties to the action
in which it is entered. “ ’It is a principle of general applica-
tion in Anglo-American jurisprudence that one is not
bound by a judgment in personam in a litigation in which he
is not designated as a party or to which he has not been
made a party by service of process.’ ” Taylor v. Sturgell, 

, 884 (2008) (quoting Hansberry v. Lee, 

,
40 (1940)); see also Richards v. Jefferson County, 

,
798 (1996); Martin v. Wilks, 

, 761 (1989); Zenith
Radio Corp. v. Hazeltine Research, Inc., 

, 110
(1969). This principle is based on the “ ’deep-rooted historic
tradition that everyone should have his own day in
court.’ ” 

(quoting 

). It limits the extent to which a judgment is
given preclusive effect in a subsequent suit, see 

95, and (more pertinent here) the extent to which an
injunction may be enforced against nonparties, see Zenith

; see also Lake Shore Asset Mgmt. Ltd.
v. Commodity Futures Trading Comm’n, 

, 766-67
(7th Cir. 2007).
18                                                 No. 08-2306

  There are some well-established exceptions to the general
principle that an injunction binds only the parties. Rule
65(d) of the Federal Rules of Civil Procedure, which
governs injunctions and temporary restraining orders,
codifies both the general principle and its exceptions:
     (2) Persons Bound. The order binds only the follow-
     ing who receive actual notice of it by personal service
     or otherwise:
       (A) the parties;
       (B) the parties’ officers, agents, servants, employ-
       ees, and attorneys; and
       (C) other persons who are in active concert or
       participation with anyone described in Rule
       65(d)(2)(A) or (B).
F ED. R. C IV. P. 65(d)(2).3
   By its terms, Rule 65(d) makes injunctions binding on the
parties to the underlying action and their “officers, agents,
servants, employees, and attorneys,” even if those “offi-
cers, agents,” etc., are not named as parties to the litigation.
F ED. R. C IV. P. 65(d)(2)(B). This is based on the idea that
“[a]n order issued to a corporation is identical to an order
issued to its officers, for incorporeal abstractions act
through agents.” 

; see also Wilson v.


3
  We quote from the current version of Rule 65(d)(2), which was
amended in 2007. The amended rule contains “no substantive
difference” from its predecessor. Lake Shore Asset Mgmt. Ltd. v.
Commodity Futures Trading Comm’n, 

, 767 (7th Cir.
2007).
No. 08-2306                                                  19

United States, 

, 376 (1911) (“A command to the
corporation is in effect a command to those who are
officially responsible for the conduct of its affairs.”);
Additive Controls & Measurement Sys., Inc. v. Flowdata, Inc.,

, 1351 (Fed. Cir. 1998) (“Rule 65(d) specifically
names ‘officers’ of a defendant as among those who are
bound by an injunction, and there is a substantial body of
case law in support of that proposition.”). As such, officers,
employees, and other agents of an enjoined party must
obey the injunction—even though they are not named
parties—when they act in their official capacities. See New
York ex rel. Vacco v. Operation Rescue Nat’l, 

, 70 (2d
Cir. 1996) (“An injunction issued against a corporation or
association binds the agents of that organization to the
extent they are acting on behalf of the organization. . . .
Generally, persons who cease to act in one of the desig-
nated capacities are no longer bound by the decree.”
(citation omitted)).
  This aspect of the rule is not implicated in this case.
Although the individual defendants might have qualified
as “officers” or “agents” of the Hereditary Guardianship
in June of 1966 when the injunction was entered, after
the organization was dissolved in December of that year,
they obviously no longer held that status. They cannot,
in other words, act in their official capacities to cause
the Hereditary Guardianship to violate the injunction.
  As to other nonparties who might properly be bound by
an injunction, the Supreme Court has explained that Rule
65(d)(2) is
20                                                 No. 08-2306

     derived from the commonlaw doctrine that a decree of
     injunction not only binds the parties defendant but also
     those identified with them in interest, in “privity” with
     them, represented by them or subject to their control.
     In essence it is that defendants may not nullify a decree
     by carrying out prohibited acts through aiders and
     abettors, although they were not parties to the original
     proceeding.
Regal Knitwear Co. v. N.L.R.B., 

, 14 (1945). Broadly
speaking, both the rule and the common-law doctrine
contemplate two categories of nonparties potentially
bound by an injunction. One includes nonparties acting in
concert with a bound party; many cases hold that a
nonparty may be held in contempt if he aids or abets an
enjoined party in violating an injunction. Id.; Chase Nat’l
Bank v. City of Norwalk, Ohio, 

, 436 (1934);
S.E.C. v. Homa, 

, 673-77 (7th Cir. 2008); Rockwell
Graphic Sys., Inc. v. DEV Indus., Inc., 

, 919
(7th Cir. 1996). This principle is codified in subsection
(2)(C) of the rule, which provides that nonparties “who are
in active concert or participation with” a bound party are
themselves bound and may be liable for aiding and
abetting the party’s contempt. See F ED . R. C IV .
P. 65(d)(2)(C). This category of nonparty contempt liability
is also not at issue here.
  The other category is captured under the general rubric
of “privity.” It is generally accepted that an injunction may
be enforced against a nonparty in “privity” with an
enjoined party. E.g., Golden State Bottling Co. v. N.L.R.B., 

, 179-80 (1973); Regal 

;
No. 08-2306                                                21

Rockwell Graphic 

. This concept can be
hard to pin down; the use of the term “privity” has ex-
panded over time. See 

n.8 (“The term
‘privity’ . . . has also come to be used more broadly, as a
way to express the conclusion that nonparty preclusion is
appropriate on any ground.”); 

(“[T]he term ‘privity’ is now used to describe various
relationships between litigants that would not have come
within the traditional definition of that term.”). In this
context, “privity” has come to be “seen as a descriptive
term for designating those with a sufficiently close identity
of interests” to justify application of nonparty claim
preclusion, Tice v. Am. Airlines, Inc., 

, 971
(7th Cir. 1998) (internal quotation marks omitted), or the
enforcement of an injunction against a nonparty, see Regal

.
   The concept of privity, however—both in preclusion
doctrine and in the law of injunctions—is ultimately
bounded by due process, which starts from a “presumption
that each person has a right to her day in court.” Martin H.
Redish & William J. Katt, Taylor v. Sturgell, Procedural Due
Process, and the Day-in-Court Ideal: Resolving the Virtual
Representation Dilemma, 84 N OTRE D AME L. R EV. 1877,
1881 (2009); see also 

(“[T]here
are clearly constitutional limits on the ‘privity’ exception
. . . .”); Regal 

(“The courts, never-
theless, may not grant an enforcement order or injunction
so broad as to make punishable the conduct of persons
who acted independently and whose rights have not been
adjudged according to law.”); 

(caution-
ing against too relaxed an approach to privity because
22                                                 No. 08-2306

“serious due process problems would arise if the earlier
nonparty were barred from her own day in court”).
  Both preclusion doctrine and Rule 65(d)(2) are concerned
with the scope and effect of a judgment, and “[i]n no area
of procedure has this [own-day-in-court] ideal traditionally
played a more important role than the field of judgments.”
Redish & 

. When privity is invoked as a
basis for binding a nonparty to an injunction, it is “re-
stricted to persons so identified in interest with those
named in the decree that it would be reasonable to con-
clude that their rights and interests have been represented
and adjudicated in the original injunction proceeding.”
11A C HARLES A LAN W RIGHT ET AL., F EDERAL P RACTICE AND
P ROCEDURE § 2956, at 340-41 (2d ed. 1995).
   The caselaw suggests that when it comes to injunctions,
the concept of nonparty privity has at least two subcatego-
ries. One line of cases holds that an injunction will bind
nonparty successors in interest to an enjoined party. E.g.,
Golden State Bottling Co., 

; Regal 

-15; Walling v. James V. Reuter, Inc., 

(1944); Reich, 

; Panther Pumps & Equip. Co.
v. Hydrocraft, Inc., 

(7th Cir. 1977); see also Opera-
tion Rescue 

(“[A party may not] circum-
vent a valid court order merely by making superficial
changes in the organization’s name or form . . . .”). Another
line of cases holds that a nonparty may be bound by an
injunction if the nonparty is otherwise “legally identified”
with the enjoined party. See, e.g., 

;
see also 

(using “legal identifica-
tion” test and favorably citing Merriam).
No. 08-2306                                               23

  The main dispute in this case centers on the First Cir-
cuit’s decision in Merriam, and specifically whether its
articulation of the “legal identity” basis for privity is
doctrinally sound. The question arises here because the
district court thought Merriam was inconsistent with the
Second Circuit’s famous articulation in Alemite of the
principles on which nonparties may be held in contempt
and the related limits on the court’s adjudicative power.
In Alemite the underlying suit involved four brothers
alleged to be partners in a business that was infringing the
plaintiff’s patent. Two of the brothers were never served,
and the case proceeded to trial against the remaining two,
John and Joseph Staff. Joseph was dismissed as a defendant
after John testified that the business belonged solely to
him and he merely employed Joseph as a salesman. The
court then enjoined John Staff and “his agents, employees,
associates and confederates” from infringing the plaintiff’s
patent. Sometime later Joseph left his brother’s employ,
“set up in business for himself, and was proved to have
infringed the patent.” 

. The plaintiff
initiated contempt proceedings against Joseph. Though he
was no longer John’s employee, and John himself was not
involved in Joseph’s infringement of the patent, the district
court found Joseph—a nonparty to the injunction ac-
tion—in contempt. 

Circuit reversed. In a decision by Judge
Hand, the court explained the background legal principles
as follows:
    [N]o court can make a decree which will bind any one
    but a party; a court of equity is as much so limited as a
24                                               No. 08-2306

     court of law; it cannot lawfully enjoin the world at
     large, no matter how broadly it words its decree. If it
     assumes to do so, the decree is pro tanto brutum
     fulmen, and the persons enjoined are free to ignore it.
     It is not vested with sovereign powers to declare
     conduct unlawful; its jurisdiction is limited to those
     over whom it gets personal service, and who therefore
     can have their day in court. Thus, the only occasion
     when a person not a party may be punished, is when
     he has helped to bring about, not merely what the
     decree has forbidden, because it may have gone too far,
     but what it has power to forbid, an act of a party. This
     means that the respondent must either abet the defen-
     dant, or must be legally identified with him.

Joseph Staff was not himself a party to the
injunction and was no longer employed by John, the
enjoined party; he had not aided or abetted a violation of
the injunction by John, the bound party. Accordingly, the
court held that Joseph could not be found in contempt.

“The District Court,” the Second Circuit ex-
plained, “had no more power in the case at bar to punish
the respondent than a third party who had never heard of
the suit.” 

the First Circuit invoked Alemite in another
case involving two brothers, but with a different result:
Merriam held that a “key employee” of a corporation could
be personally bound by an injunction against the corpora-
tion even after he ceased being an agent of the 

. Brothers John and George Hoskins opened
a small reference-book marketing company known as the
No. 08-2306                                                25

Webster Dictionary Company in 1975; John was its presi-
dent and sole shareholder, and George was his general
sales manager. At its peak the company had six employees;
it was not in business very long. The big dictionary firm G.
& C. Merriam Co. owned the rights to the well-known
“Webster’s” line of dictionaries, and in late 1975 it sued
Webster Dictionary for trademark infringement, seeking
damages and injunctive relief. In March 1977 Webster
Dictionary advised the court that it was insolvent, was
discharging its attorneys, and would consent to entry of an
“appropriate judgment” against it. In October of that year,
the district court held that Webster Dictionary had de-
faulted and entered a permanent injunction against it and
John Hoskins barring them from using various Merriam
tradenames and marks. Webster Dictionary went out of
business and John Hoskins exited the reference-book
market.
  George Hoskins did not. In 1976, still employed by
Webster Dictionary, George incorporated Webster Publish-
ing Company and two related corporations, the business of
which bore “a striking resemblance to that of Webster
Dictionary Company.” 

After Webster Dictionary
ceased operations, George Hoskins, through Webster
Publishing, continued to use Merriam’s tradenames and
marks in much the same way as Webster Dictionary had.
The district court held that George Hoskins and Webster
Publishing were bound by the injunction against Webster
Dictionary and found them in contempt.
  The First Circuit reversed based on a lack of clarity in the
district court’s order and remanded with a detailed
26                                                 No. 08-2306

explanation of the possible legal grounds for holding
George Hoskins and Webster Publishing bound by the
injunction though they were not parties to the underlying
litigation. The court began with a discussion of Alemite,
summarizing the holding in this way: “To hold a non-
party bound by an injunction it is thus essential to prove
either that the nonparty participated in the contumacious
act of a party or that the nonparty was subject to the
injunction because [he is] legally identified with a party.”

Because George Hoskins had not participated in
an act of contempt by John, the court recognized that he
could not be held in contempt as an aider and abettor. 

noted that an enjoined party’s “successors and
assigns” might be “legally identified” with the bound party
and thus obligated to obey the injunction; this justification
for nonparty contempt was also unavailable because
George Hoskins and Webster Publishing were not the
successors or assigns of John or Webster Dictionary. In this
regard, the court observed that “[i]t is not enough to prove
that the first entity went out of existence and . . . the second
entity entered into the enjoined type of business activity,
knowing about the injunction but without having acquired
the business, or a relevant part of it, from the first entity.”

   But the court went on to conclude that a person could be
“legally identified” with an enjoined corporation and thus
personally bound by the injunction if he was a “key
employee” of the corporation, had a significant role in the
underlying litigation, and was closely identified with the
bound party in other relevant respects. 

Impor-
No. 08-2306                                             27

tantly, the court explained that the nonparty’s status as a
“key employee” of the enjoined corporation is not suffi-
cient by itself to personally bind him to the injunction:
   [T]hat George Hoskins was a “key employee” of
   Webster Dictionary Company as well as “the princi-
   pal” of [Webster Publishing] . . . is insufficient to
   support the district court’s conclusion that George
   Hoskins was bound by the injunction. The central
   reason that one who is not a party to the action
   in which the injunction was issued cannot be bound
   by it is that he has not had his day in court with
   respect to the validity of the injunction. Cf. 

. Absent an opportunity to contest liability, his
   knowledge of the injunction is not sufficient to bind
   him as an individual, 

from prohib-
   iting him from acting in the forbidden way on behalf
   of the enjoined party. Thus, the relevant inquiry is not
   merely whether (in addition to having knowledge of
   the injunction) George Hoskins was a “key employee”
   of Webster Dictionary Company but whether he had
   such a key role in the corporation’s participation in
   the injunction proceedings that it can be fairly said
   that he has had his day in court in relation to the
   validity of the injunction.

issued these remand instructions to the
district court:
   The evidence raises a fact issue as to whether this is
   a case of the same person continuing to do
   essentially the same thing with the same high degree
   of practical control, discretion and responsibility,
28                                                    No. 08-2306

     before and after the injunction, with knowledge of the
     injunction, and after participating in the enjoined
     firm’s corporate decisionmaking regarding its position
     in the injunction proceedings. If it is found that George
     Hoskins was legally identified with Webster Dictionary
     Company in this way, then he is bound by the injunc-
     tion and the appellant corporations founded by him
     are also subject to it.

  The upshot of Merriam is that a key employee, officer,
director, shareholder, or other central figure in an
enjoined corporation can be personally bound by the
injunction even after the company has dissolved, provided
he had a controlling role in the injunction proceedings
and is otherwise so “closely identified” with the
enjoined corporation that it may reasonably be said that
he had his day in court when the injunction was issued.4
These important qualifiers keep Merriam within the limits
of due process.



4
   Understood in this way, Merriam corresponds to one of the
categories of nonparty preclusion listed in Taylor, which might
be described in shorthand as “control person” preclusion. Taylor
v. Sturgell, 

, 895 (2008) (“[A] nonparty is bound by a
judgment if she assumed control over the litigation in which that
judgment was rendered.” (internal quotation marks omitted));
see also Montana v. United States, 

, 153-54 (1979);
Schnell v. Peter Eckrich & Sons, Inc., 

, 262 n.4 (1961);
Souffront v. La Compagnie des Sucreries de Porto Rico, 

,
486-87 (1910).
No. 08-2306                                                29

  In this case, the district court rejected Merriam’s holding
for essentially two reasons. First, the judge thought
Merriam was in “silent tension” with Judge Hand’s opinion
in Alemite. Second, she concluded that Merriam conflicted
with the Supreme Court’s decision in Zenith Radio Corp. v.
Hazeltine Research, Inc., 

(1969). We disagree on
both counts.
   Though Alemite and Merriam reached very different
results, the two opinions can be reconciled. For starters,
Alemite specifically noted that a nonparty to an injunction
proceeding may be held in contempt for violating the
injunction when the nonparty “either abet[s] the defendant,
or [is] legally identified with 

(emphasis
added). Moreover, Alemite’s result—that a salesman is not
bound along with his corporation—is consistent with
Merriam’s holding that a “key employee,” without more, is
not legally identified with the enjoined company. 

. To be sure, there are factual differences
between the two cases, but we find no tension between the
two as a legal matter. See 

(distinguishing Alemite
on these grounds). Both cases recognize the following
categories of nonparty contempt liability: (1) aiders and
abettors; and (2) those who are legally identified with the
enjoined party. “Legal identity” usually means successors
and assigns, but it can include a limited class of other
nonparties as well—provided the evidence establishes a
very close identity of interest and such significant control
over the organization and the underlying litigation that it
is fair to say that the nonparty had his day in court when
the injunction was issued.
30                                               No. 08-2306

   As for the perceived inconsistency between Merriam and
Zenith Radio, here too we disagree. In Zenith Radio the
Supreme Court reiterated the general rule that a court
may not issue an injunction against a person over which
the court had not acquired jurisdiction by service of

; accord United States v.
Kirschenbaum, 

, 794-96 (7th Cir. 1998). But
the Court clearly anticipated that a nonparty may
properly be held in contempt for violating an injunction
if the court acquires jurisdiction over the nonparty and
gives the nonparty an opportunity to contest whether he
is bound by the injunction and is in fact in contempt.
Zenith 

(“[A] nonparty with notice
cannot be held in contempt until shown to be in concert
or participation. It was error to enter the injunction against
Hazeltine, without having made this determination in
a proceeding to which Hazeltine was a party.” (emphasis
added)). Once a court establishes jurisdiction over a
nonparty and offers the nonparty this opportunity to be
heard on whether concerted action or privity exists,
Zenith Radio requires nothing further insofar as Rule
65(d)(2) is concerned. See Lake Shore Asset 

(offering similar understanding of Zenith Radio
and stating “whether a particular person or firm is among
[those listed in Rule 65(d)(2)(B)-(C)] is a decision that
may be made only after the person in question is given
notice and an opportunity to be heard”); see also 

“act at their peril if they disregard
the commands of the injunction, for, if the district court
ultimately determines that they are in concert with [the
enjoined party], then they will be in contempt of court.”);
No. 08-2306                                                  31

Waffenschmidt v. MacKay, 

, 718 (5th Cir. 1985)
(similar).
  The district court read Zenith Radio more generally to
stand for the proposition that “a non-party cannot be
personally bound by an injunction unless that non-party
has had an actual day in court in its own right.” That’s a
true statement, but the “day in court” at issue in Zenith
Radio refers to the nonparty’s opportunity to contest
whether he acted in concert with a party contemnor or was
in privity and therefore bound by the injunction. If after
an appropriate hearing the court concludes that the
nonparty was in privity with the enjoined party, Zenith
Radio does not require relitigation of the underlying
controversy. (To the contrary, as we have noted, the
general rule is that contempt proceedings may not be used
to collaterally attack the injunction.) Merriam does not
hold, or even suggest, that a court may find a nonparty in
contempt without acquiring personal jurisdiction over him
and providing an opportunity to contest the grounds for
finding him bound by and in contempt of the injunction.
Merriam does not violate the rule in Zenith Radio.5
  Finally, though we have few cases in this area, none
conflict with the approach taken in Merriam, and one
suggests substantial agreement. Reich v. Sea Sprite Boat Co.
held that the president and sole shareholder of Sea Sprite,


5
  The proceedings in this case fully complied with Zenith Radio.
The respondents were served with process, and the court held
an evidentiary hearing offering them ample and complete
opportunity to contest whether they came within Rule 65(d)(2).
32                                                No. 08-2306

an enjoined corporation, was in contempt for diluting the
bound corporation’s assets and thereafter establishing a
new company to evade the injunction. 

. We
explained that the enjoined company’s president, Robert
Smith, “was obliged to secure Sea Sprite’s compliance
[with the injunction]; instead he ensured its defiance. The
formation of [the new company] for the admitted purpose
of evading judgments against Sea Sprite was a further act
of contempt.” 

While the new company was
clearly a successor in interest to the bound corporation, our
reasoning suggests that contempt against the president and
sole shareholder was appropriate because he was legally
identified with Sea Sprite (in the sense that he completely
controlled it), personally participated in the injunction
proceedings, and directed the use of the new corporation
to violate the injunction. 

of Sea Sprite’s assets
to an unrelated party would pose different, and potentially
difficult problems. . . . A shuffle between two corporations,
both wholly owned by Smith, cannot avoid the injunction.”
(citation omitted)); see also Rockwell Graphic 

(Eschbach, J., concurring) (stressing that the president
of an enjoined company “finds no quarter in the fact that
[the company] is no longer in existence”). Merriam has
been cited with approval by one circuit, see 

-53, and has not been expressly rejected
anywhere else.
  Accordingly, it was a mistake to reject Merriam. A key
officer, employee, or shareholder of an enjoined corpora-
tion may be personally bound by the injunction after the
corporation dissolves if he is so closely identified in in-
terest and had a controlling role in the corporation and in
No. 08-2306                                                33

the underlying litigation that it is fair to conclude that he
had his day in court when the injunction was issued. The
Federal Circuit has identified the following factors that
may be pertinent to the Merriam inquiry: “[T]he officer’s
position and responsibilities in the enjoined corporation,
his participation in the litigation that preceded the entry of
the injunction, and the degree of similarity between his
activities in the old and new businesses.” 

(explaining the Merriam test). It bears emphasizing that
due process requires an extremely close identification and
will be satisfied only when the nonparty “key employee”
against whom contempt sanctions are sought had substan-
tial discretion, control, and influence over the enjoined
organization—both in general and with respect to its
participation in the underlying litigation—and there is a
high degree of similarity between the activities of the old
organization and the new. See 

(finding analogy to piercing-the-corporate-veil doctrine
to be “apt”).


D. Marangella, Schlatter, and the Provisional National
   Council
  Although it rejected Merriam, the district court’s findings
are sufficiently detailed and supported by the record that
we can affirm the court’s no-privity finding without a
remand. Of particular importance are the court’s findings
regarding the dissimilarities between the Hereditary
Guardianship and the Provisional National Council, and
the break between Remey and his followers on the one
34                                              No. 08-2306

hand and Marangella, Schlatter, and their coreligionists on
the other. It is true that Marangella and Schlatter occupied
key positions in the Hereditary Guardianship, and both
participated in varying degrees in the underlying trade-
mark litigation. In other circumstances we might require
more detailed fact-finding regarding the precise role each
nonparty alleged contemnor played in the enjoined
organization and in the underlying injunction litigation.
For reasons we will explain, however, we can dispense
with that here.
  The district court concluded that the Provisional Na-
tional Council, which represents those who accept
Marangella as the Third Guardian, is substantially dissimi-
lar to the Hereditary Guardianship; the record supports
this conclusion. Although Marangella, Schlatter, and
other members of the Provisional National Council
were actively involved in the Hereditary Guardianship
in the 1960s, the record reflects that after the injunction
was issued and the Hereditary Guardianship dissolved, the
remnants of this dissident group scattered. After a two-
year period of dormancy, Marangella announced his own
Guardianship and broke with Remey on matters of succes-
sorship, doctrine, and governance. Schlatter followed him,
and a new religious organization was established, albeit
(eventually) operating in the same place and with some of
the same people as were involved in the Hereditary
Guardianship. The new group, in due course, took the
name “Provisional National Council.” The district court
specifically found that “the vast weight of the record
evidence establishes that the [Provisional National Coun-
cil] was not formed for the purpose of escaping the con-
No. 08-2306                                             35

fines of the injunction.” The court also found that its
membership—numbering about 40 people—“did not in
fact encompass all of the same individuals that comprised
the [Hereditary Guardianship].” Based on these facts, the
court concluded that on a “defining point of organizational
purpose, there existed a robust doctrinal divide” between
the Hereditary Guardianship and the Provisional National
Council. The court also concluded that the latter was not
“operating in effect” as the former, nor did there “other-
wise [exist] a substantial continuity between the two
groups.”
  These findings and conclusions are sufficient to defeat
any claim that Marangella, Schlatter, and the Provisional
National Council are “legally identified” with the Heredi-
tary Guardianship and therefore in privity with it and
bound by the 1966 injunction. This is so even assuming
Marangella and Schlatter could be considered “key”
officers or agents of the Hereditary Guardianship. The
doctrinal differences—especially when combined with
the passage of time—make it clear as a matter of law that
the Provisional National Council and its principals cannot
be considered “legally identified” with the Hereditary
Guardianship or Remey. To take note of these differences
is not to decide a religious dispute; the district court’s
findings and conclusions do not transgress Presbyterian
Church. Accordingly, even when Merriam is taken
into account, the district court’s no-privity conclusion as
to this group of alleged contemnors was correct.
36                                              No. 08-2306

E. Second International Council and Bahá’í Publishers
  The National Spiritual Assembly also challenges the
district court’s decision that the Second International
Council and Bahá’í Publishers are not bound by the
injunction. It offers two reasons for binding these
nonparties: First, they were created by Jensen, who (the
argument goes) was personally bound by the injunction;
and second, they are successors in interest to Remey, who
also was personally bound by the injunction.


  1. The Jensen Connection
   The district court rejected the contention that the Second
International Council and Bahá’í Publishers were in privity
with the Hereditary Guardianship through Jensen. After
declining to apply Merriam, the judge explicitly entered an
alternative holding that Jensen was not legally identified
with the Hereditary Guardianship even if Merriam applied.
The judge acknowledged that Jensen was an incorporator
of the Hereditary Guardianship, that he served as one of its
first board members, and that contemporaneous evidence
suggested that Jensen remained a follower of the Heredi-
tary Guardianship during the underlying litigation.
Nevertheless, the court found that Jensen disassociated
himself from any governing role in the organization shortly
after serving his one-year term on the board. This was well
before the underlying injunction was issued.
  The National Spiritual Assembly disputes these findings.
It argues that Jensen’s extensive involvement with the
Hereditary Guardianship prior to the underlying litigation
No. 08-2306                                              37

establishes legal identity. We see no clear error in the
district court’s findings, which were amply supported by
the record. Jensen’s term on the Hereditary Guardianship
board ended in the middle of 1964; he was not reelected as
a board member. After he lost reelection, he did not serve
in a governance, advisory, or any other controlling position
in the Hereditary Guardianship, and he had no involve-
ment in the underlying litigation. As such, Jensen did not
occupy the sort of “key” role in the Hereditary Guardian-
ship—either generally or with respect to injunction litiga-
tion—that could form the basis of a “legal identity” finding
under Merriam.
  The National Spiritual Assembly argues in the alternative
that Jensen (and by extension, the Second International
Council and the Bahá’í Publishers) should be bound by the
injunction because Jensen remained an adherent and the
Hereditary Guardianship adequately represented its
believers’ interests in the underlying suit against the
National Spiritual Assembly. The Supreme Court in Taylor
and our own recent decision in Tice recognize that the
concept of privity in preclusion doctrine includes a very
limited adequate-representation category. See 

(observing that “adequate representation” by
“someone with the same interests who [wa]s a party” to
the earlier suit sufficed for privity purposes “in certain
limited circumstances,” including “properly conducted
class actions” and “suits brought by trustees, guardians,
and other fiduciaries”); 

(“[U]nless a
formal kind of successor interest is involved . . . , there
should be some indication . . . that the second party either
had participated or had a legal duty to participate.”); see
38                                              No. 08-2306

also R ESTATEMENT (SECOND) OF JUDGMENTS § 41 (similarly
limiting adequate-representation theory of privity). The
trademark litigation 44 years ago does not fit into this
limited category.
  A finding of privity based on “adequate representation”
in the circumstances of this case would be entirely unwar-
ranted. The Hereditary Guardianship did not conduct the
underlying litigation as anything like a fiduciary for its
members, and there is no evidence to suggest it was acting
in a representative capacity for its followers personally. To
find privity based on “adequate representation” here
would treat every suit by an organization as having res
judicata and contempt implications for the organization’s
members individually. This is contrary to the Supreme
Court’s language in Taylor carefully limiting the scope of
the adequate-representation category of privity.
   At bottom, this argument is an appeal to the theory of
“virtual representation,” which the Supreme Court has
firmly rejected in the field of claim preclusion. 

. Having rejected virtual-representation theory
in its traditional res judicata setting, we see no reason why
the Supreme Court would view it more favorably in the
context of injunctions. The district court properly rejected
the attempt to bind the Second International Council and
Bahá’í Publishers through Jensen.


  2. The Remey Connection
  The National Spiritual Assembly also argues that the
Second International Council and Bahá’í Publishers are
No. 08-2306                                                  39

bound by the injunction through privity with Remey. This
argument is based on trademark-registration filings with
the United States Patent and Trademark Office in which
Neal Chase, the current president of the Second Interna-
tional Council and Bahá’í Publishers, explained that the
throne to the “Davidic kingdom” passed by succession
from Bahá’u’lláh to Abdu’l-Bahá, to Charles Mason Remey,
to Pepe Remey (Remey’s adopted son), and now to him.
The National Spiritual Assembly treats these filings as an
admission of legal successorship to Remey, who in turn
was legally identified with the Hereditary Guardianship.
   The district court treated the trademark-registration
filings as nonbinding evidentiary admissions rather than
binding judicial admissions. See Help at Home, Inc. v. Med.
Capital, L.L.C., 

, 753 & n.2 (7th Cir. 2001);
Higgins v. Mississippi, 

, 954 (7th Cir. 2000);
Murrey v. United States, 

, 1455 (7th Cir. 1996);
Keller v. United States, 

, 1198 n.8 (7th Cir. 1995).
The National Spiritual Assembly apparently agrees with
this characterization, but argues that the court gave them
insufficient weight. We find no fault with the district
court’s treatment of this factual matter. Other than the
version of spiritual-leadership succession described in
trademark filings, the National Spiritual Assembly offered
no evidence of a link between Remey and the Second
International Council or Bahá’í Publishers. Indeed, Remey
had no involvement in either organization and died more
than 25 years before the Second International Council was
established. Neither the Second International Council nor
Bahá’í Publishers received any money, property, or other
assets from Remey or the Hereditary Guardianship. On
40                                                  No. 08-2306

these facts the district court properly concluded that the
Second International Council and Bahá’í Publishers are not
successors to Remey. See 

(succes-
sors are “those to whom the business may have been
transferred”); 

(nonparty succes-
sorship liability under injunction requires a “substantial
continuity of identity”); cf. Golden State Bottling 

(finding bona fide purchaser of a business
enterprise was the legal successor to the enterprise and
thus subject to enterprise’s liability); 

(a
company that “acquired the business subject to this court’s
order” was legal successor and bound by the order).
                                                     A FFIRMED.




                            11-23-10