When will attorneys fees be awarded in a trademark infringement lawsuit

When will attorneys fees be awarded in a trademark infringement lawsuit

A trademark is some that that a manufacturer brands its products with to identify who manufactured the product.  Traditionally a trademark was a word, phrase or symbol used to label the product but it is possible to trademark things such as colors or scents.  Trademarks are intended to protect consumers from inferior quality products.  Trademark owners are granted the exclusive right to brand their goods with a trademark to prevent consumer confusion about who manufactured a product.  If someone other than the trademark owner uses a trademark in a way which creates consumer confusion, that can be considered trademark infringement.  A trademark owner can sue to stop trademark infringement with an injunction and to get monetary damages for trademark infringement which has already occurred.

Because trademark law in the United States is defined by state law, federal law and various court decisions, it can sometimes be difficult to determine what monetary damages a trademark owner can recover. The Lanham Act is a federal law which defines what is considered trademark infringement and what damages can be awarded to a trademark owner.  Even though there is only one Lanham Act, was is a split in the different federal circuit courts on how the law is interpreted.  Specifically there was a difference of opinion in the different circuit courts about whether trademark infringement must be willful for a trademark owner to get a defendant’s profits related to trademark infringement.  The Lanham Act states, in exceptional cases the court may award reasonable attorney fees to the prevailing party. 15 U.S.C. § 1117(a).  But the courts differed on what constituted an exception case.  Some courts imposed the requirement that the plaintiff must prove that the infringement was willful, other courts did not impost the willful requirement.

In Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S. Ct. 1749 (2014), the Supreme Court held that under 35 U.S.C. § 285, “an ‘exceptional’ case is simply one that stands out from others with respect to the substantive strength of a party’s litigating position . . . or the unreasonable manner in which the case was litigated . . . , considering the totality of the circumstances.”  35 U.S.C. § 285 is part of United States patent law, but it worded almost identically to 15 U.S.C. § 1117(a) in the Lanham Act.  Octane v. ICON did not directly touch on the Lanham Act.

This ambiguity lead to Romag Fasteners, Inc. v. Fossil, Inc., 2016-1115, 2016-1116, 2016-1842 (C.A.F.C. 2017).  In that case, Romag sued Fossil for patent infringement and trademark infringement.  The district court awarded attorney’s fees for the patent infringement portion of the lawsuit, but not the trademark infringement.  The district court came to this decision because Romag had not proven that Fossil’s trademark infringement was willful, which was a requirement for an award of attorney’s fees under Second Circuit case law.  The Court of Appeals for the Federal Circuit had jurisdiction over the appeal, because the case involved patent law, and affirmed the district court’s ruling.  Romag appealed to the United States Supreme Court which remanded the case back to the Federal Circuit to consider in light of the Octane decision.  The Federal Circuit then remanded the case back to the district court to apply the correct interpretation of the law to the facts of the case.

Romag was a long path to follow to ultimately reach the conclusion that attorneys fees may be awarded in trademark infringement cases based on the totality of the circumstances, a showing of willfulness is not required.

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