O.A. Cargo, Inc. v. OA Cargo Chicago, No. 12 C 5763, Slip OP. (N.D. Ill. Mar. 13, 2014) (Zagel, J.).
Judge Zagel awarded damages in this Lanham Act case after he and Judge Conlon entered default judgment against the defendants.
Pursuant to its “considerable discretion” to award damages based upon a default judgment, the Court awarded the following damages:
- Expenses incurred in setting up Defendants’ business – $36,826.24
- Franchise fee – $50,000
- Ongoing licensing fees of $8,633.33 per month for 16.5 months – $142,449.95 + $35,612.49 = $178,062.44
- Attorneys’ fees and costs – $35,816.47
- Statutory interest
The Court did not award damages for the entire 26 month period for which plaintiff sought the ongoing licensing fees. The Court held that the evidence did not support the full 26 months. Instead, the evidence supported 16.5 months. The Court awarded damages for 16.5 months. The Court also held that there was evidence that defendants’ conduct was willful. The evidence warranted a 25% increase in the award of ongoing licensing fees, but not the trebling sought by plaintiff. Finally, the Court denied damages based upon plaintiff’s alleged reputational harm because the damages were “insufficiently supported.”
Dental USA, Inc. v. McClellan, No. 13 C 260, Slip OP. (N.D. Ill. Aug. 16, 2013) (Zagel, J.).
Judge Zagel granted in part plaintiff Dental USA’s motion for a temporary restraining order and injunction in this trademark and design patent infringement case. Dental USA had a trademark for DENTAL USA, as well as POWER ELEVATOR for a tooth extraction machine. Dental USA also had a design patent for the tooth extraction machine. Defendants are former employees of Dental USA who allegedly formed United Dental USA, which competed with Dental USA, including by selling a Misch Power Elevator that performs the same function as Dental USA’s Power Elevator. Dental USA also alleged that defendants improperly used Dental USA’s copyrighted images on defendants’ website. Dental USA sought an order enjoining defendants from: 1) using the United Dental USA name at upcoming trade shows; 2) selling Misch Power Elevators, along with any related tools; 3) selling infringing products on defendants’ website; and 4) using Dental USA’s copyrighted works on defendants’ website. Dental USA also sough seizure of counterfeit goods.
Defendants were barred from using the name United Dental USA at any future trade shows until the Court reached a decision on the merits. Defendants had already agreed not to use the name at one, upcoming tradeshow in San Francisco. Defendants were ordered to take down their uniteddentalusa.com website until at least a final judgment was issued in the case.
The Court held that DENTAL USA and UNITED DENTAL USA were “self-evidently very similar marks.” Adding “United” did little to change that analysis, particularly because the U in USA was an abbreviation for “united.” Dental USA also had at least some evidence of actual confusion. There was also evidence that Defendants were using Dental USA’s part numbers and product images, adding to the likelihood of confusion. There was also at least some evidence of actual confusion.
The Court noted that Lanham Act violations are presumed to be irreparable harm, and the evidence in this case bolstered that — the similarity of the products and the fact that the parties compete at the same trade shows.
The balance of equities favored Dental USA. In particular, defendants used two names — United Dental USA and Misch Instruments. Because Misch Instruments was the dominant name, defendants were unlikely to be harmed by an injunction.
The public had a strong interest in enforcing intellectual property which was somewhat balanced by an interest in healthy competition. If the Court felt that the injunction would put defendants out of business, it might have changed the analysis, but that was unlikely.
The Court, however, denied Dental USA’s motion to enjoin sales of the Misch Power Elevator. But the Court enjoined the use of the MISCH POWER ELEVATOR trademark or any other POWER ELEVATOR mark, for similar reasons. The Court did, however, delay the injunction until after the San Francisco trade show. Having enjoined the products so close to that trade show would have seriously harmed defendant’s business.
PWC has published the latest installment in its excellent yearly patent litigation survey. This year’s survey looks at data for every year from 1995 through 2012. One interesting aspect of this year’s study was a focus upon individual districts and judges. Here are some of the key takeaways regarding the Northern District:
- The Northern District (a top five patent district in terms of number of filings) is the fifteenth fastest district to trial with 35 cases going to trial during the period (1995-2012) in a median time of 3.67 years. That is relatively slow as compared to the Eastern District of Virginia’s .97 years mediation or the Western District of Wisconsin’s 1.07 years. But those times to trial do not take into account the number of trials — 32 for the Northern District, 22 for Virginia and 10 for Wisconsin — nor do they consider the relative complexity of those cases.
- In those trials, plaintiff’s have a 24.8% success rate with median damages of almost $5.9M. That puts the Northern District 8th in terms of largest median damages awarded, and 13th in plaintiff’s success rate.
- The Northern District is 2nd in terms of number of reported NPE decisions with 32 decisions and 133 total patent decisions. In those decisions, the NPEs’ success rate was 12.5%.
- The Northern District is also the 4th district in ANDA filings with twelve.
The PWC study also looks at individual judges, with Northern District judges ranking high in all categories:
- Judge Darrah was the 11th judge nationwide in terms of patent decisions with 10 total. Plaintiffs’ success rate was 10% on those decisions. Seven of the ten decisions were summary judgment decisions. Judge Darrah is ranked 8th for summary judgment decisions nationwide with seven decisions and a 0% success rates for plaintiffs.
- Judge Kendall was 18th with nine decisions (88.9% were summary judgment decisions). Kendall had an 11.1% success rate for plaintiffs. Judge Kendall is ranked 6th for summary judgment decisions nationwide with eight decisions and a 12.5% success rates for plaintiffs.
- Judge Bucklo was 21st with eight decisions (62.5% were summary judgment decisions). Bucklo had a 50% success rate for plaintiffs. Judge Bucklo is ranked 24th for summary judgment decisions nationwide with five decisions and a 20% success rates for plaintiffs.
- Judge Guzman was 34th with seven decisions (71.4% were summary judgment decisions) with a 14.3% success rate for plaintiffs. Judge Guzman is ranked 26th for summary judgment decisions nationwide with five decisions and a 20% success rates for plaintiffs.
- Judge Zagel was 35th with six decisions (66.7% were summary judgment decisions) with a 66.7% success rate for plaintiffs. Judge Zagel is ranked 36th for summary judgment decisions nationwide with four decisions and a 50% success rates for plaintiffs.
- Judge St. Eve was 41st with six decisions (83.3% were summary judgment decisions) with a 16.7% success rate for plaintiffs. Judge St. Eve is ranked 35th for summary judgment decisions nationwide with five decisions and a 0% success rates for plaintiffs.
- Judge Kennelly is ranked 31st for summary judgment decisions nationwide with five decisions and a 0% success rates for plaintiffs.
The judge-by-judge statistics are interesting, but because of the relatively low number of decisions and the relatively simple statistics offered, they likely do not tell us much. It is hard to draw many clear conclusions from sample sets of, in most cases, four to six summary judgment decisions spaced over years with varied parties and circumstances. It is also curious that Judge Pallmeyer did not make any of the lists, although she has been on a number of lists as one of the busiest patent judges in the nation over the almost seven years that I have been writing this blog.