Ninth Circuit Report

• Jurisdiction: United States,Federal
• Author: Anne-Marie Dao
• Publication year: 2019
• Citation: Vol. 44 No. 4

Ninth Circuit Report

Anne-Marie Dao

Troutman Sanders LLP

Hopefully everyone is enjoying the winter season (and here's to hoping that we actually feel like there is a winter in California—particularly southern California—this year). This Ninth Circuit Report focuses on trademarks and the Supreme Court's upcoming term, which is expected to resolve a split amongst the Circuits relating to trademark damages.

THE ISSUE

The Circuits are currently split as to whether plaintiffs must establish willful infringement prior to recovering an infringer's profits under the Lanham Act.

THE NINTH CIRCUIT POSITION

The Ninth Circuit recently clarified its position to the above issue in the affirmative—plaintiffs do have to establish willful infringement prior to litigating their entitlement to an award of an infringer's profits.¹ Specifically, the Ninth Circuit discussed the effect of the 1999 amendment to the Lanham Act's remedies provision:²

Historically, we have imposed a willfulness requirement with respect to disgorgement of profits. Now we must decide what effect, if any, a 1999 amendment to the Lanham Act's remedies provision has on our precedent regarding awarding of profits. We agree with the district court that the 1999 amendment has not changed the state of the law on disgorgement and that willfulness is still required....

To put it in plain English, if there is

1. a violation of the rights in a registered mark, an unregistered mark (§ 1125(a)), or a mark used as a domain name (§ 1125(d)), or
2. a willful violation under the dilution statute (§ 1125(c)), then, 'subject to the principles of equity,' the plaintiff is entitled to relief. Critically, Congress did not modify the 'subject to the principles of equity' language.

After analyzing the statutory language, the history of the statute, and discussing what Congress changed, the Ninth Circuit reasoned that "it would be a mistake to draw a negative implication from the unrelated and later-introduced language that the amendment somehow negated our circuit's well-settled willfulness requirement."³

THE ROMAG FASTENERS LITIGATION

The Romag Fasteners case has been ongoing for nearly a decade.⁴Beginning in 2010, Plaintiff Romag sued Defendant Fossil for trademark infringement. After a seven-day trial, a jury found for Plaintiff and awarded Plaintiff approximately $90,000 in damages to prevent unjust enrichment and almost another $7 million dollars in profits to deter future trademark infringement.⁵ The district court then conducted a...