What happens if you ignore a trademark infringement lawsuit? QUIKSILVER v. SAYLOR

A trademark something that a company uses to distinguish the products it sells from the products of competitors. Traditionally a trademark is though of as a symbol, word or short phrase, but anything that a company uses to distinguish its products from competitors products can be eligible for trademark protection. In the United States a trademark can be registered with the United States Patent and Trademark Office to strength the rights associated with a trademark, however registration is not required for a company to claim a trademark. The first company to use a trademark to brand goods is considered the senior user of a trademark, subsequent users of the trademark are considered junior users. United States trademark law gives the senior user of a trademark priority over junior users, even if the junior user registers a trademark.

The key to the strength of a trademark is the association consumers make between a trademark and the source of a product. If a junior trademark user brands products in a way that is likely to lead to consumer confusion as to the producer of a product, that can be considered trademark infringement. A trademark owner can file a lawsuit to stop trademark infringement with an injunction, and get monetary damages for trademark infringement which has occurred.

When a court is presented with a trademark infringement lawsuit, the court will review several factors to determine whether there is likelihood of confusion between the plaintiff’s and defendant’s trademarks. These factors were first articulated in Polaroid Corp. v. Polarad Elecs. Corp., 287 F.2d 492 (2d Cir. 1961), and are refereed to as the Polaroid factors. However, a court will not perform an analysis of the Polariod factors if a defendant in a trademark infringement suit if the defendant does not respond to the complaint. When a defendant is named in a trademark infringement complaint it is up to the defendant to answer the complaint and defend itself. The consequences of ignoring a trademark infringement suit can be severe.

QUIKSILVER SHUTTLE INC, v. NIKOLAS SHAWN SAYLOR, 18-CV-00245 (W.D.MO 2018) is a case which illustrates the consequences of failing to respond to a trademark infringement lawsuit. The plaintiff in this case operates a taxi service in the Kansas City Missouri area named QUICKSILVER SHUTTLE. From 2011 to 2016 the plaintiff operated the taxi service profitably. In 2016 the plaintiff sold the business, along with its trademarks to the defendant. In 2017 the defendant allegedly breached the terms of the sales contract and the plaintiff took possession of the business back from the plaintiff.

In 2018 the defendant began operating a competing taxi service using a similar name QUIKSILVER SHUTTLE. The plaintiff’s revenue declined for several reasons, including consumers mistakenly filing complaints against the plaintiff’s firm because of the behavior of the defendant’s firm. The plaintiff alleges that the defendant’s poor performance and similar trademark caused the plaintiff’s firm to become unprofitable. The plaintiff then filed suit against the defendant for trademark infringement and unfair competition in 2018.

The defendant failed to answer the complaint and the court issued an order to show cause directing the defendant to explain why default judgement should not be entered. The defendant failed to respond to the order to show cause as well. The court entered default judgement against the defendant’s permanently enjoining the defendant from using any trademarks similar to QUICKSILVER, an award of $506,903.59 in damage to the plaintiff, transfer of all phone numbers, websites and customer lists to the plaintiff and attorney’s fees.

The lesson here is clear, if a trademark infringement defendant fails to appear, the penalty can be substantial.

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