Romag Fasteners, Inc. v. Fossil, Inc. (18-1233)

argument 18-1233

Romag Fasteners, Inc. v. Fossil, Inc.

Supreme Court of the United States 57 min 6 speakers 8 chapters transcribed 7 days ago official recording ↗

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What is the Lanham Act’s “principles of equity” and why does it matter in trademark profit awards?

John G. Roberts 0:00

We'll hear argument next in case eighteen twelve thirty three, Romeg fasteners versus fossil ink. Ms. Black.

Unknown 0:08

Thank you, Mr Chief Justice, and may it please the Court. The Lanham Act authorizes courts to remedy trademark violations by awarding infringers profits subject to the principles of equity. The question presented here is whether the print the phrase principles of equity requires trademark owners to prove willfulness as an absolute precondition to profit awards. The answer is no for three reasons. First, the phrase principles of equity signifies a multi factor analysis where no one factor is controlling Second, the phrase the statutory text and structure supersede any settled willfulness requirement. And third, there was no such settled background willfulness requirement. First, the phrase principles of equity refers to the familiar equitable principles that courts have long applied in determining whether to award profits in trademark cases.

Unknown 1:05

A defendant's culpability is a weighty factor, but it should not be controlling. Other traditional equitable factors are also important to further the landmark the the Lanimac's purposes to protect consumers and trademark owners' goodwill. Such traditional factors include whether other relief adequately compensates the plaintiff and whether the defendant is enriched by his violation of law. And these factors can all exist along a spectrum. For instance, culpability can range from fraudulent to innocence and everything in between, including callous disregard and negligence. So in a case where a defendant is completely innocent, court should require a greater showing of other factors before awarding profits.

Unknown 1:52

Conversely A greater culpability justifies a profit award that deters future infringement. And courts can be trusted to use their discretion to balance the equities for the cases in between. The statute also requires the amount of any award to be uh compensatory and not a penalty and just according to the circumstances. Second, even assuming a settled willfulness requirement before the Lanham Act, the statutory text and structure reflect a congressional intent to supersede it. From the Act's inception, i. e. from nineteen forty six, Congress has expressly distinguished and protected defendants and which defendants from awards of monetary relief based on a heightened mental state. Today the Lanham Act contains eight provisions tying monetary relief to a heightened mental state.

Unknown 2:47

That's that's a lot of provisions. The provision that dictates monetary relief, section one hundred one seven A, is the provision that controls this case. That case, uh that provision requires a willful violation for uh trademark dilution under eleven twenty-five C. But no such Mental State requirement appears for infringement violations under Section eleven twenty five A or any other cause of action under the Lanham Act. We think the inference is particularly strong that the omission of a willfulness requirement is intentional. The same Congress in nineteen ninety nine that amended the statute to add uh a willfulness requirement for trademark dilution cases under subsection C affirmatively distinguished this type of infringement case under subsection A because the amendment simultaneously uh struck out the word violation of sections eleven twenty five A and then reinserted that same phrase violation of subsection A.

Elena Kagan 4:00

I could you concentrate on the word equity? Do you think equity Would sustain an award. for innocent or good faith infringement. without a more culpable state of mind.

Elena Kagan 4:23

Truly good faith. And willful. There could be reckless, there could be callous disregard. Would equity constinants. an award for negligence or good faith.

Unknown 4:39

Yes, and as I said in the earlier in the earlier case, you would need a greater showing of the other purposes or the other equitable factors, and those are two. The first and foremost is whether if no other relief could adequately compensate the plaintiff. And even in a case of a completely innocent defendant, uh damages are notoriously hard to prove, they're almost never recovered in trademark cases, and they're particularly impossible to prove in component cases.