The Lanham Act provides for three categories of damages the court may award in a successful trademark infringement case: (1) Actual Damages, (2) Disgorgement of the Infringer’s Profits, and (3) Attorney’s Fees and Costs. 

A potential measure of damages is the disgorgement of the infringing Defendant’s profits. Resulting from the infringement of the successful Plaintiff’s mark, an equitable remedy is required in account of Defendant’s profits. Additionally, the purpose of disgorgement is to prevent the Defendant from being unjustly enriched from the litigation. After the Plaintiff establishes the gross revenue attributed to the Defendant from the litigation, then the Defendant can challenge the Plaintiff’s evidence. 

A successful Plaintiff can recover actual damages in addition to the Defendant’s profits from their infringing conduct. Proof is typically required to attain actual damages from alleged consumer confusion. Evidence can be difficult to established in comparison to standard infringement but is still necessary. Furthermore, actual damages can be measured in multiple ways depending on how the federal court feels most appropriate.

Additional ways to establish actual damages may include:

a)     Lost profits that the successful Plaintiff would have realized “but for” the infringement. The Plaintiff is required to show certain revenue amounts that the Defendant’s would have noticed.

b)     Loss of goods will be acquired through association of consumers with the Plaintiff’s mark and the quality of goods/services sold under said mark. The total loss is measure by assessing the value in which the Plaintiff’s trademark before and after the Defendant infringed upon the mark.

c)     The Plaintiff is required to implement corrective advertising to alleviate the impact of the Defendant’s infringement per the consumer public. This will require proof that the Plaintiff and Defendant are in direct competition in the same marketplace.

d)     Reasonable Royalty. The federal court can also award actual damages like the trademark licensing fee that should have been paid by the Defendant to the Plaintiff instead of infringing on the mark.

e)     Certain circumstances may lead the court to award enhanced damages up to the amount of actual damages proved by Plaintiff. In other words, when actual damages are difficult to calculate, the courts perceive that the Plaintiff would be under-compensated for the damages due to the infringement. 

The Lanham Act allows for the federal court to award reasonable attorney’s fees in their discretion in exceptional cases. Furthermore, exceptional cases typically involve deliberate infringing acts.

This information is not legal advice but should be considered as general guidance in the area of intellectual property law. Should you need an experienced attorney to guide you in you in trademark litigation, our team at Wilson Whitaker Rynell is prepared. Please give our office a call to schedule a free consultation.