Why it matters: Last month, a legal analytics firm released a report that tracks and analyzes statistics, metrics and trends across all trademark litigation filed in the U.S. District Courts from January 2009 through March 2016. The upshot: Trademark litigation continues to be an essential enforcement tool for companies to protect their brands.
Detailed discussion: In May 2016, legal analytics firm Lex Machina released its Trademark Litigation Report for 2016 (Report). The Report compiles statistics and "examines several important metrics (and their interactions) for trademark litigation in aggregate" across cases filed in the U.S. District Courts from January 2009 through the end of the first quarter of 2016. The charts included in the Report provide detailed coded statistics with respect to, among other things, case status (e.g., initial filings, updates and terminations), remedies, findings and judgments, and damages. The Report demonstrated that, over the relevant period, companies continued to rely heavily on trademark litigation as an effective enforcement tool to protect their—in many cases "luxury"—brands.
First, some key definitions: As used in the Report, a "Trademark Case" is defined as a case with one or more claims involving violations of the Lanham Act (the federal trademark statute) including for trademark infringement, trademark dilution, unfair competition or cybersquatting. This definition excludes cases with only state claims of infringement or unfair competition, trademark ownership disputes, and appeals from TTAB or USPTO decisions. The Report breaks out statistics for two primary subcategories of Trademark Cases, (1) Cybersquatting Cases, defined as "Trademark Cases involving claims of cyberpiracy prohibited under 15 U.S.C. § 1125 (d) of the Lanham Act"; and (2) False Advertising Cases, defined as "Trademark Cases involving claims of false advertising prohibited under 15 U.S.C. § 1125 (a)(1)(B) of the Lanham Act."
Here are some of the Report's highlights:*
District Court filing statistics:
- Highest districts in overall Trademark Case filings: Central District of California (4,164), followed by Southern District of New York (2,142) and Southern District of Florida (1,659).
- Top three districts for Cybersquatting Case filings: Southern District of Florida (486), Northern District of Illinois (429), and Central District of California (361).
- Top three districts for False Advertising Case filings: Central District of California (785), Southern District of New York (389), and Northern District of Illinois (274).
Parties—top plaintiffs and defendants:
- Top plaintiffs (by cases filed): Coach (730), Chanel (330), and Microsoft (203).
- Last 5 quarters (1/1/15–3/31/16): Sream, Inc. (RooR water pipes) (55), Phoenix Entertainment Partners, LLC (karaoke licensor) (54), Chanel (47) and Coach (20).
- Top defendants: National Football League and affiliates (548—majority related to dispute over use of former players' likenesses); Syngenta Seeds (184), Big Bad Limo Service (109), Amazon (66), and Walmart (59).
- Last 5 quarters (1/1/15–3/31/16): Syngenta Seeds and its affiliates comprised the top 6 defendants sued (140).
- Injunctions and other remedies: For Trademark Cases generally, approximate median time to obtain a (a) temporary restraining order—6 days, (b) preliminary injunction—1 month, and (c) permanent injunction—6 months. Research showed that Cybersquatting Cases tended to reach preliminary injunction at a slightly faster rate but False Advertising Cases tended to take longer to reach both preliminary and permanent injunction. Chanel, Tiffany, Louis Vuitton, Gucci, and Coach were among the most common parties to relinquishment of domain name actions.
- Findings and judgments: Default judgments were entered at a high rate and accounted for 68.0% of all findings of Lanham Act violations. Equitable and fair use issues tended to be decided on summary judgment.
- Damages: A vast majority of the damages awarded in Trademark Cases arose out of default judgments, with the remainder mostly arising from consent judgments. For decisions on the merits, juries awarded damages more frequently than judges.
- Top three cumulative damage awards from all Trademark Cases: Chanel ($1 billion), Burberry ($523 million), and Gucci ($208 million).
- Top three cumulative damage awards excluding damages from default or consent judgments: Coach ($66 million), PODS Enterprises ($60 million), and Neurovision Medical Products ($60 million).
*Information for period 1/1/09–3/31/16 unless otherwise indicated.
Overall, the Report provides useful insight into the current state of U.S. trademark litigation and the trends that are shaping it.
See here to read Lex Machina's "Trademark Litigation Report 2016."