US Trademark Law/Remedies
Injunctions are a standard remedy for trademark infringement. The usual injunction is to halt production and sale of infringing goods and services.
In some cases, the court might also award an injunction for corrective advertising, which forces the defendant to pay for an amount of advertising necessary to reverse the damage to the plaintiff's mark.
Under 15 U.S.C. § 1117, a court may award damages for trademark infringement reflecting some combination of the following factors. Trebled damages are available for damage amounts derived from defendant's profits, actual damages plaintiff sustained, and cost of bringing the lawsuit.
- defendant's profits (15 U.S.C. § 1117(a)(1))
- damages sustained by the plaintiff (15 U.S.C. § 1117(a)(2))
- cost of bringing the lawsuit (may include attorney's fees) (15 U.S.C. § 1117(a)(3))
- prejudgment interest (15 U.S.C. § 1117(b))
- statutory damages (15 U.S.C. § 1117(d)
Plaintiff is required only to prove the amount of defendant's sales. The burden then shifts to defendant to prove up its costs and expenses to be deducted from the total sales amount to give the amount of defendant's profits. If the court finds the recovery amount based on defendant's profits is inadequate or excessive, the court may enter judgment a sum it believes is just in light of the "circumstances of the case."
Damages Sustained by Plaintiff
Plaintiff must prove up its actual damages. The court bases its determination of damages on the actual amount of damages plaintiff's has proven or any sum above that amount but not more than three times above the actual damage amount.
Costs of the Action
The court may also award reasonable attorney's fees to the winning party but only in exceptional circumstances.
Trebling of Damages
In the case of a counterfeit mark or designation (as defined in 15 U.S.C. § 1116(d)), non-statutory damage amounts are to be trebled unless the court finds "extenuating circumstances." Note that Congress intended for courts to award trebled damages in most cases.
Specifically, the Lanham Act says where plaintiff has proven any violation of 15 U.S.C. § 1114(1)(a) or 36 U.S.C. § 220506, a court shall enter judgment for three times such profits or damages, whichever amount is greater, together with a reasonable attorney’s fee, if the violation consists of:
- (1) intentionally using a mark or designation, knowing such mark or designation is a counterfeit mark (as defined in 15 U.S.C. §1116 (d))), in connection with the sale, offering for sale, or distribution of goods or services; or
- (2) providing goods or services necessary to the commission of a violation specified in paragraph (1), with the intent that the recipient of the goods or services would put the goods or services to use in committing the violation.
The court may also award interest beginning from the date of the service of the plaintiff’s pleadings setting forth the claim for such entry of judgment and ending on the date such entry is made, or for such shorter time as the court considers appropriate. (See 26 U.S.C. §6621 (a)(2) for method of determining interest rate).
15 U.S.C. § 1117(c) provides a plaintiff the option of electing (before final judgment) recovery of statutory damages for any such use. The statutory damages are based upon the "willfulness" of the counterfeit:
- (1) if the court finds the use of the counterfeit mark was not willful, the statutory damages will be not less than $1,000 or more than $200,000 per counterfeit mark per type of goods or services sold, offered for sale, or distributed, as the court considers just; or
- (2) if the court finds that the use of the counterfeit mark was willful, not more than $2,000,000 per counterfeit mark per type of goods or services sold, offered for sale, or distributed, as the court considers just.
This statutory amount is in lieu of and not in addition to profits or actual damages; and is not subject to trebling under 15 U.S.C. § 1117(b).
Knowingly copying another's trademark is considered counterfeiting and is a felony punishable by fines and imprisonment under 18 U.S.C. § 2320.