This article is written by Shreya Patra of Xavier Law School, Xavier University, Bhubaneshwar. This article broadly covers all aspects related to remedies one can seek in various cases of trademark infringement in the United States. It also covers the preventive measures one should take in order to prevent any trademark infringement from happening.
It has been published by Rachit Garg.
Trademark infringement is a serious and growing problem in the US. It is a type of intellectual property infringement where a person or company uses a trademark that belongs to someone else without their permission. This can lead to confusion between two brands, create a false impression of the original brand, and cause damage to the original brand’s reputation. In this article, we’ll explore some of the remedies available for trademark infringement in the US and strategies to combat it. Trademarks are those distinct intellectual properties that are represented by either a symbol or word(s) or emblem that help to identify goods and services.
Trademark infringement is a serious issue. It occurs when someone uses a trademark belonging to another person or company without their permission. This can include using a similar or identical name, logo, slogan, or other identifying features of the original trademark.
Laws against trademark infringement in the United States solely focus on providing benefits to the owner of the trademark. This is to ensure the continued creation of their unique products with no compromise on quality. It also provides disincentives for those who take advantage of such trademarks and create cheaper copies of such products, which ultimately affect the image of the trademark products and the trademark owner.
The US trademark law provides a number of remedies for those who have been victims of trademark infringement. This includes the right to seek an injunction, damages for profits, damages for counterfeiting, damages for cybersquatting, and other forms of relief.
Categorization of remedies available
There are different types of remedies available for trademark infringement in the United States. which are broadly categorized as follows:
Remedies of trademark infringement under civil laws
In instances of trademark infringement, there are several remedies available. These remedies differ from one another and strive to ensure that the injured party is compensated for the loss and damages. The objective of providing monetary compensation firsthand in cases of trademark infringement is to help reverse the damages suffered and bring the victim back to the position they once were in as if they had never suffered any injury. The civil remedies available are as follows:
- Monetary compensation
- Permanent injunction
- Preliminary injunction
- Temporary restraining order
- Compensation equal to profits earned by infringement
- General Damages
- Treble Damages
- Statutory Damages
- Injunction for injury caused due to counterfeiting
- Statutory Damages for cybersquatting
- Order for suspension
- Order for restoration or transfer to original owner
All the civil remedies available are drawn from the legal provisions, which differ from State to State in the United States. The same has been discussed below in a detailed manner.
Remedies of trademark infringement under the criminal law
Trademark infringement does not merely amount to a breach of Civil Law, but it is also a criminal offense. The Lanham Act, which is the Federal Law, does not discreetly have any provision for awarding punitive damages. However, some state laws do have their own provisions for awarding punitive damages. Under Section 2320 of Title 18 of the United States Code, anyone who traffic goods or services that are counterfeit would be fined, imprisoned or both, depending on the order of the Court.
Understanding Injunctive Reliefs
Injunctive relief is the most common form of relief sought in cases of trademark infringement. It is an order from the court requiring the defendant to stop infringing on the plaintiff’s trademark. This can include an order to cease and desist from using the trademark, an order to stop using the trademark in certain ways, or an order to turn over any profits made from the infringement.
Injunctive relief is particularly important for trademark infringement because it is a form of protection for the plaintiff. If the defendant does not comply with the court’s order, they may be subjected to further legal action, such as criminal prosecution or contempt of court.
Injunctive reliefs are the most sought-after form of relief because they allow some relief to the trademark owners and guarantee the protection of the products that carry such trademarks through a court order or direction. This prevents further distribution or creation of the product, helps the owner avoid facing any further losses, prevents the quality of the trademarked product from diminishing further, and keeps the image of the trademark intact. Injunctive relief can be found in Section 1116 of Title 15 of the United States Code, which deals with all trade and commerce-related aspects of the law in the United States.
It is important to note that the person seeking the injunction should furnish all certified copies of documents like proof of trademark ownership and trademark license for use, to the Court to streamline the process of granting an injunction. The person should also ensure that the court has the jurisdiction to grant an injunction in the matter.
Steps to seek injunctive relief
The plaintiff is entitled to file for injunctions of three kinds, namely:
Permanent injunction for trademark infringement
A permanent injunction is the most extreme form of injunction. It acts as a cease-and-desist notice. It is issued through a court order that directs the party to stop doing any activities that are linked to the infringement of a trademark and is issued at the last stage of the court proceedings. When the money awarded is not enough to adequately restore the damages caused, only then do the Courts pass an order of permanent injunction. Failure to act in accordance with a Court’s order of injunction attracts contempt of the Court.
In the case of Weinberger v. Romero-Barcelo (1982), after careful consideration, a four-step test was devised that helped determine whether the plaintiff was entitled to get a permanent injunction. The four steps can be summarized as follows: 1) the infringement has caused irreparable injury to the plaintiff; 2) other reliefs available to the plaintiff are not sufficient to make up for their loss; 3) the obstacles both parties face must be taken into account and weighed; 4) granting such an injunction should not cause any injury to society at large or hurt their interests.
Preliminary injunction for trademark infringement
A preliminary injunction is very different from a temporary restraining order or even a permanent injunction. As the name suggests, it is granted before the court arrives at its final judgment, and it can be granted at any stage of the trial after a formal hearing and before its conclusion. To determine whether a preliminary injunction should be granted or not, it is important to draw our attention to an important case, Winter v. Natural Resources Defense Council, Inc. (2008), wherein the Supreme Court of the United States highlighted that it is important to satisfy that there has been irreparable harm that would continue if not for an injunction; the plaintiff’s hardships should outweigh that of the other party’s; and the injunction should be in favor of the public interest.
The case of Winter v. Natural Resources Defense Council, Inc. laid down a balancing test very similar to Weinberger v. Romero-Barcelo, but for a preliminary injunction. Such an injunction is subject to denial by the judge, which is known as an interlocutory order. Such interlocutory orders are appealable and known as interlocutory appeals. A preliminary injunction is issued as per Rule 65 of the Federal Rules of Civil Procedure. The state rules related to preliminary injunctions vary between states and can be classified as follows:
|Rules of Civil Procedure||AlabamaNorth Carolina|
|Code of Civil Procedure||Alaska CaliforniaWyoming|
|Courts and Civil Proceedings||Arizona|
|Civil Procedure Generally-Title 16, Subtitle 5||Arkansas|
|Colorado (searchable index)||Colorado|
|Civil Process, Service and Time for Return||Connecticut|
|Civil Procedure||Washington, DCIllinoisIndianaKentuckyMassachusettsMichiganMinnesotaMontanaNew MexicoNorth CarolinaNorth DakotaOhioOklahomaPennsylvaniaRhode IslandSouth CarolinaSouth DakotaTennesseeUtahVermontWashington|
|Procedure Searchable Index- See Generally Maryland Rules||Delaware|
|Civil Practice and Procedure||FloridaMississippi|
|Civil Practice- Title 9||Georgia|
|Civil Remedies and Defenses and Special Proceedings||Hawaii|
|Proceedings in Civil Actions in Courts of Record||Idaho|
|Civil Procedure – Subtitle 3||Iowa|
|Court Procedure– Civil||Maine|
|Civil Procedure and Limitations||Missouri|
|Courts; Civil Procedure||Nebraska|
|Justice Courts and Civil Procedure||Nevada|
|Proceedings in Court||New Hampshire|
|Administration of Civil and Criminal Justice||New Jersey|
|CVP, Civil Practice Law & Rules||New York|
|Procedure in Civil Proceedings-(see Chapters 12-36)||Oregon|
|Civil Procedure in General Sessions Courts||Tennessee|
|Civil Practice and Remedies Code||Texas|
|Civil Remedies and Procedure||Virginia|
|Actions, Suits and Arbitration, Pleading and Practice, Evidence and Witness||West Virginia and this|
|Civil Procedure (Chapters 801-847)||Wisconsin|
Temporary restraining order for trademark infringement
A temporary restraining order is a kind of injunction that is issued for a short period of time to prevent the party from taking any certain action until the court can issue an order granting a preliminary injunction or even a permanent injunction later on. A temporary injunction is usually the first step towards obtaining a permanent injunction or preliminary injunction and also helps and provides time for the court to properly hear the matter and decide on the case.
In the matter of Vuitton et Fils S.A. (1979), a temporary restraining order in the form of a preliminary injunction was issued in order to prevent the sale of counterfeit Vuitton handbags. A temporary restraining order is issued only in very specific circumstances. And in this case, it was to prevent the sale – not just any sale, but the sale of handbags of the brand Vuitton, which were currently facing claims of counterfeiting.
A temporary restraining order (TRO) is governed by Rule 65 of the Federal Rules of Civil Procedure. Often, temporary restraining orders are issued to prevent the parties from getting in contact with each other and harming each other. For example, A temporary restraining order might be issued to Party 2 to prevent Party 2 from constantly getting in contact with Party 1 and asking them to drop the suit by harassing Party 1.
Subject to the plaintiff seeking an injunction and it being granted by the court, the defendant is required to file with the court and also serve on the plaintiff, within 30 days of being served with such an injunction, a detailed report under oath explaining the same. If the defendant does not comply with the injunction, they may be punished with contempt of court by the court that granted the injunction or by the court holding jurisdiction over the defendant’s place of residence. The transfer of certified copies is made as per sub-clause (b) of Section 1116 of Title 15 and subsequently one month after the transfer and filing of the case, a notice is sent to the director informing him/her about the case and other details.
- As per sub-clause (b) of Section 1116 of Title 15 of the United States Code, on an application, the office of the court granting the injunction has to be provided, and on directions of the court, a transfer is made of all certified copies from the court it was filed at to the court enforcing it as if the court enforcing it has granted it.
- As per sub-clause (d) of Section 1116 of Title 15 of the United States Code, one month after the suit is filed, a notice is provided by the office of the court, which contains in writing to the Director all details about the litigants and the registration number of the proceedings they are facing before them. Any further developments in the proceeding, including additional pleadings, answers, etc., should be given to the Director through a notice. The Director is responsible for producing such notices on receipt in the same file with the registration number it contains in order to continue to add them to the respective file later on as the proceedings continue to have additional documents.
Injunctive relief is the most sought-after relief that the plaintiff can seek in order to protect their trademark and ensure that there is no further infringement. A permanent injunction, a preliminary injunction, or a restraining order allows the plaintiff to put a stop to the infringer’s activities and prevent further loss or damage to his or her business.
Injunctive Relief Against Domain Name Registrars
As per sub-clause (2) (D) of Section 1114 of Title 15 of the United States Code, the authority concerned with the registration of the domain that takes action is not to be liable for any monetary compensation except if they have not complied with the court order; if they have taken any steps towards the domain name during the pendency of the suit; or if they have not submitted the required documents.
As per sub-clause (2) (D) (i) (II) of Section 1114 of Title 15 of the United States Code, the actions that the domain name authority is required to take include transfer, removal, and cancellation of the domain name and its registration, but are not limited to them. Such actions are required to be in compliance with the court order, and in addition to this, they are required to come up with a policy to prevent this from happening by refusing to register similar domain names as a preventive measure as per sub-clause (2) (D) (ii) of Section 1114 of Title 15 of the United States Code.
As per sub-clause (2) (D) (iv) of Section 1114 of Title 15 of the United States Code, the registration authority of the domain name takes action when an application is filed for the same. Subsequent to them taking action, the person who is the infringer shall be made liable to compensate for the damages, costs, and attorney’s fees that arose as a result of the infringement that was borne by the registrant of the domain name.
In the event that the domain name has been either transferred, suspended, or disabled as per clause (ii) (II) of Section 1114 of Title 15 of the United States Code, then a civil action has to be filed by the registrant stating that such use of the domain name is not unlawful. The court may subsequently grant the registrant of the domain name an injunction and even activate or transfer the domain name on the basis of the action taken against it previously.
In cases of trademark infringement involving domain names, the plaintiff may be able to seek injunctive relief against the domain name registrar. This means that the court can order the registrar to suspend or cancel the infringing domain name. This is an important form of protection for the plaintiff, as it prevents the defendant from continuing to use the infringing domain.
The injunctive relief that the court grants against domain name registrars differ from case to case, as the extent of the injury caused becomes an important factor in determining the damage to be awarded and the monetary compensation that should follow it. It is left up to the court to decide
There is no concrete concept of granting damages in instances of trademark infringement, and what usually follows is monetary compensation for such violations rather than punishment. But there are certain exceptional cases where, upon providing evidence showing either bad faith or confusion that resulted in infringement, damages may be granted by the court. The damages awarded by the court can vary from case to case.
Damages for Profits
The plaintiff in a trademark infringement case may be able to seek damages for profits made by the defendant. This means that the defendant must pay the plaintiff damages equal to the profits made from the infringing activity. This is a form of compensation for the plaintiff, and it is intended to prevent the defendant from profiting from the infringement.
What the plaintiff would have to establish is the fact that due to the fraudulent sale of the defendant, the plaintiff lost a legitimate sale that could have profited him, and hence such an unjust enrichment would not and should not be indulged in, and hence they should be compensated for the same. Thus, all that is required is compensation for all such fraudulent sales in order to calculate the compensation for the same.
Section 1111 to Section 1114 of Title 15 of the United States Code contain provisions related to the recovery of illegitimate profits to compensate the injured party with some relief. There are various ways in which these unlawful profits can be recovered. The ways in which profit can be recovered include the following:
- Disgorgement or the breaking down of profits obtained unjustly by the other party, i.e. the infringer; or
- Estimating the loss of the plaintiff through measuring the profits obtained by the infringer.
It becomes important to award damages for profits, as these profits are lost by the plaintiff. The only problem with awarding such damages is that it is often very difficult to arrive at an amount since they are based on estimates of an amount that would be equal to what the plaintiff could have possibly lost due to such infringement. It is difficult to predict the amount, and hence disgorgement or measuring the loss of the plaintiff through the profit of the defendant are the ways to arrive at the amount.
In the case of Romag Fasteners, Inc. v. Fossil Grp., Inc., (2020), the plaintiff sought to discover the damages that the defendant caused by taking unfair advantage of the plaintiff and earning profit as a result. In this case, the defendant signed a deal with the plaintiff for fasteners for the handbags. The plaintiff also had a trademark and patent for the same. After a while, during the defendant’s investigation, they found fake and imitation fasteners of the plaintiff’s patented design to be installed by their manufacturers. In order to prevent any damages to their name and fame, the plaintiff sought for an injunction, among other actions in the suit. A suit was filed in the court by the plaintiff. The case also went on to be heard by the Supreme Court. It was decided that there is no need to prove any wilfulness on the part of the defendant who made use of a false and misleading trademark. Such willfulness is not a mandatory condition required to be fulfilled for seeking damages for profits.
The court takes into account the fact that a sale occurred in favor of the infringer instead of the owner i.e., which could have been the owner’s profit. Thus, it makes an unfair deal for the owner as the infringer has bagged all the profit. So in order to compensate for such an unfair deal, the court awards compensation equal to all the fraudulent profits that the infringer has earned.
Damages for Counterfeiting
The plaintiff in a trademark infringement case may also be able to seek damages for counterfeiting. This means that the defendant must pay damages equal to the difference between the price of the genuine product and the price of the counterfeit product. This is intended to prevent the defendant from profiting from the sale of counterfeit goods.
Counterfeiting refers to forging or making copies of a product when you do not have the authority or the license to do so. It is a way of making easy money on someone else’s brand name and good faith by deceiving others into thinking it is an original and genuine product. A counterfeit mark is defined under sub-clause (d) (1) (B) of Section 1116 of Title 15 of the United States Code.
The damages awarded for counterfeiting are as follows:
As per Section 471 of Title 18 of the United States Code on Counterfeiting and Forgery, a person with an intent to defraud another with counterfeiting may face imprisonment extending up to 20 years, a fine, or even both. Some states, such as California, have different laws under which they are not required to prove intent, and thus this allows them to take up the defense of lack of knowledge.
Treble Damages are those damages wherein, after the jury has decided on an amount for the plaintiff, the court awards three times the profits or damages (whichever is greater of both) of the jury’s decided amount caused by the use of the counterfeit mark as described under sub-clause (d) of Section 1116 of Title 15 of the United States Code for the instances described under sub-clauses (b)(1) and (b)(2) of Section 1117 of Title 15 of the United States Code.
Such an amount excludes the attorney’s fees, and hence the amount must be paid in addition to the attorney’s fees. Subject to the above provisions, the court may, before announcing its final judgment, charge interest on such an amount in the form of an annual interest governed by Section 6621(a)(2) of Title 26 of the United States Code.
In addition to this, Title 15 of the United States Code helps to ascertain the damages by either increasing or decreasing their value to arrive at the closest number possible.
Statutory damages are awarded when the claim of the suit is such that it becomes difficult to establish the monetary value of the injury and loss caused. This value is generally established by the statute itself in order to compensate the victim for the loss and injury they suffered.
Statutory Damages for counterfeit marks (as described under sub-clause (d) of Section 1116 of Title 15 of the United States Code) are governed under sub-clause (c) of Section 1117 of Title 15 of the United States Code. The statutory damages provided are as follows:
A monetary compensation of an amount not less than $1,000 or greater than $200,000 per counterfeit mark as per the type of services and goods that are either sold, offered to be sold, or even distributed;
Monetary compensation of an amount up to $200,000 per counterfeit mark as per the type of services and goods that are either sold, offered to be sold, or even distributed, as per what court deems to be the appropriate amount
In addition to the monetary compensation described above, the court may additionally issue a direction through an order to the infringer to prevent the sale and distribution of the counterfeit products that have happened to him. Such an order has to be complied with. If the infringer fails to follow the court’s directions, they are charged with contempt of court.
All the civil actions that arise due to clause (1) (a) of Section 1114 of Title 15 of the United States Code or Section 220506 of Title 36 of the United States Code being violated are subject to clause (d) (1) (A) of Section 1116 of Title 15 of the United States Code, with counterfeit marks being defined under clause (d) (1) (B) of Section 1116 of Title 15 of the United States Code.
Steps for filing an application of injunctive relief against infringement of trademark
The steps to file a case of counterfeiting under clause (d) of Section 1116 of Title 15 of the United States Code are as follows:
Step 1: The applicant, in a timely manner as per requirements, must give a notice of application. Subsequent to this, the applicant, with the help of a United States. attorney, filed before the court before which such an order is sought by them. (Under clause (d) (2) of Section 1116 of Title 15 of the United States Code.) The applicant may note that such an application if found against the public interest, is subject to being dismissed. The attorney can be engaged in the proceedings if it affects the admission of evidence that goes against the United States.
Step 2: The application submitted that is soon to be heard before the Judge is made to be subject to the following:
- The application should be based on concrete facts, and there should be adequate facts to support the same.
- Shall comply with everything described under Step 4.
Step 3: The court will grant the application a hearing in the following cases:
- The monetary compensation for the damages, if proven successful, is the same as that of a person who has filed for wrongful seizure or wrongful attempt seizure
- Any order directing ex-parte seizure is not sufficient to achieve the purpose contained under Section 1114 of Title 15 of the United States Code.
- Such a seizure has not been made public.
- If the plaintiff is going to win the claim against the other party who is to face such a seizure order.
- There would be an irreparable loss to the applicant immediately.
- The products facing seizure are at the location that the applicant has stated.
- The injury that the application would face outweighs the interests of the party facing such an order of seizure.
- The products would face destruction and might be transported or hidden elsewhere, or even make it out of reach of the court if the person were issued a notice as the first step in order to make it available to them.
Step 4: The order pronounced by the court is subject to the following:
- The facts and deductions of law required to arrive at the order
- A proper description of the items taken into legal custody, including the place where such an item has been seized and other details related to it.
- Such seizures should be brought into force by an order that is issued. The time period between such issuance of the order and the seizure of items should not be any more than seven days.
- The security that has to be paid is determined by the damage caused.
- The order must also contain the date on which the hearing is to be held.
Step 5: The court should strive to protect the identity and image of the person against whom such an order, or specifically an order of seizure, is made by the plaintiff in order to prevent publicity.
Step 6: Any seizure made through an order must be accompanied by a protective order. The protective order is to contain all the items that have been discovered and a list of any other records or information that might have been obtained in the process of such a seizure. It is essential for there to be a protective order, as it certifies that the information or records that have been obtained contain confidential information that is not to be used improperly. All the items that have been seized are in the custody of the court.
Step 7: The person facing such an order of seizure is allowed to contest it in court; until this happens, the items and records seized are to remain sealed. The person facing such a seizure order shall have access to the court order and other documents related to the order.
Step 8: A Federal law officer (as specified under clause (d) (9) of Section 1116 of Title 15 of the United States Code) is to serve a copy of the order. Upon the successful service of such a copy of the order, the seizure process begins as per the order. If required, to ensure the safety of the defendant, the court may issue additional orders to prevent any leak of information that may cause damage or injury to his or her business or personal life and ensure that the same extends to the applicant, who shall not be granted access to such confidential information.
Step 9: After steps 1 to 8 have been completed, the court arranges a date for the hearing of all the parties involved in the case unless the parties decide to postpone the date decided on the seizure order. The date that is set should be at least 10 days after such an order has been issued but not more than 15 days after such an order is issued. The date may extend this limit if the applicant provides a reasonable explanation for changing the dates or if the other party facing such an order of seizure provides consent for the changed date. On the date of the hearing, the party is required to provide all evidence and interpretations of the law to support that order would remain in effect, and the failure to do the same, the seizure order be dismissed or altered.
In the extension of the hearing, the court has the power to allow for others that are capable of altering the time for discovering the items to be seized as per the Rules under Civil Procedure to divert any aggravation that might be caused for the benefit of the hearing.
Under clause (d) (11) of Section 1116 of Title 15 of the United States Code, if one finds themselves in a position where they have been wrongfully seized of their items or records, or anything else for a matter of fact, they have the right and also the legal provision (this sub-section) that empowers them to reclaim all that is lost, which includes the price of the items, profits that have been lost, and damages in the form of punishment, in which it becomes important to prove such a seizure was carried out with a malafide intention, and additionally the court may also award covering of attorney’s fees to ease the burden provided it is reasonable.
In addition to this, the court may, in its reasonable judgment, award pre-judgment interest as a form of relief that can be recovered under clause (d) (11) of Section 1116 of Title 15 of the United States Code. The interest rate is calculated annually as per clause (a) (2) of Section 6621 of Title 26 of the United States Code. Such an interest award begins from the date the claimant’s pleading is served as per the claim in this paragraph and ends on the date when there is a grant of such recovery. The time period for awarding the interest might be reduced to a shorter period if the court deems it appropriate.
These are the different types of damages awarded for the counterfeiting of trademarks. Such damages are provided by the court after taking into consideration both sides’ pleas. Such damages allow the plaintiff to recover from the loss of counterfeiting and provide some form of compensation in monetary terms. In order to make the Lanham Act applicable, it is important that the copy, that is, the counterfeit product, be made to look identical to the product that has its trademark registered.
Damages for Cybersquatting
With the recent increase in internet use, there has been an observed rise in the illicit use of trademarks. Cybersquatting refers to the use of domain names that are quite similar to those owned by trademark owners and are used to get money by either selling them or using them to extract money from them. The process by which cybersquatters take advantage of a genuine trademark owner’s domain name is quite easy to understand.
Cybersquatters first register a domain name similar to the domain name of a trademark. Then they use this similar domain name to extract the money and thus use a combination of legal and illegal tactics, leaving the trademark owner with a huge loss at their hands. Cybersquatting can quite easily be classified as a crime against an individual, a trade, a firm, a company, or both. Cybersquatting is one of the most important issues to be addressed in today’s world because it takes advantage of the goodwill of the trademark owner and causes irreparable damage to them and their business.
In cases of cybersquatting, the plaintiff may be able to seek damages for the defendant’s bad-faith registration and use of a domain name that is identical to or confusingly similar to the plaintiff’s trademark. This is a form of compensation for the plaintiff, and it is intended to prevent the defendant from profiting from the infringement.
In order to combat this, the Anti-Cybersquatting Consumer Protection Act (also known as ACPA) was brought into existence in order to offer some protection to trademark owners in the cyber world. There are different types of cybersquatting that occur on the internet. The various types of cybersquatting and the remedies available are as follows:
Typo squatting refers to taking advantage of the URL usually typed out by users, which is usually prone to mistakes, and confusing them into believing it is a genuine site and getting them to buy it from there instead of the actual site. Typosquatting is also known as fake URL, sting site, or even URL hijacking. They make use of the original website and keep the font, colors, and design the same on the fake website, making it difficult to distinguish between both at first glance.
The Anti-Cybersquatting Consumer Protection Act (also known as ACPA) was developed to address the issue of unauthorized internet use of domain names to profit from the goodwill of such trademarks. The Anti-Cybersquatting Consumer Protection Act allows victims to seek compensation in the form of statutory damages. The statutory damages range from $1,000 to no more than $100,000. In addition to statutory damages, injunctions are also sought by the victims in order to prevent further damages.
Identity theft is one of the major problems in the cyber world. The trademark owner owns the domain name for a specific period of time. Once the time period expires, the trademark owners are required to renew the domain name, but often they are unable to do so either because they are forgetful or if cybersquatters have purchased that domain name. This allows the cybersquatters to portray themselves as the owner and mislead the users of the website into believing it.
Cybersquatters often track such renewals of domain names using software that allows them to monitor the expiration of such domain names. The Anti-Cybersquatting Consumer Protection Act (also known as ACPA) was created just for this.
Name Jacking makes use of the names of popular and famous people and cashes out money using their fame. Since such people are public figures and everyone knows about them, they help generate lots of views and traffic on the website. They benefit by making use of such public figures’ popularity and registering a domain in their name to garner attention. In order to combat this, the United States provides such public personalities with a trademark to protect their names. The Anti-Cybersquatting Consumer Protection Act (also known as ACPA) was designed to address this problem.
Reverse cyber-squatting refers to when cybersquatters try to obtain the domain name owned by the legitimate owner. This is also known as reverse domain name hijacking. They made use of threats, pressure, and even false claims of cybersquatting in order to coerce the owner to provide them with the domain name.
Such crimes are mostly committed against larger firms, corporations, and even public figures. The Anti-Cybersquatting Consumer Protection Act (also known as ACPA) and the Uniform Domain Name Dispute Resolution (also known as UDRP) were created to prevent cybersquatting. As per sub-clause (ii) (II) of Section 1114 of Title 15 of the United States Code, the policy mentioned refers to the UDRP policy.
In instances of competing uses of cybersquatting, competitors, in order to gain an unfair advantage over their adversary, register their adversary’s trademark. The problem lies in the fact that the whole process of registration took place in bad faith and with bad intentions, and thus the same should not be allowed.
With the trademark in the competitor’s name, the adversary cannot produce products under the trademark as it would amount to infringement even though the trademark belongs to the adversary and not the competitor. The most important step to prevent this is to register the trademark with the USPTO office to prevent any such discrepancies and also avail additional benefits on successful registration.
Non-competing use (i.e., Legitimate Claims)
Non-competing use of trademarks is the most complicated because of its vague definition. If we take, for example, a shared or joint trademark, like United, it is used jointly by a moving company called Van Lines and even Airways. In that case, the registration of the domain name going by United would only be made available to one of these entities and not all of them. In this case, due to the difference in either the territory or the industry of operation, they are able to share and commonly use the trademark.
There are two types of legitimate claim disputes that are raised before the court, and they are as follows:
- The first type of legitimate dispute is a competing claim, which occurs when the holder of the trademark sues another who holds the domain name but has no trademark rights. This prevents the original trademark holder from being able to register the domain name, as it is already registered by another.
- The second type of legitimate dispute is a competing claim is one in which both the parties involved in the dispute have claims in their names. In this case, registering the domain name does not necessarily guarantee a court ruling in your favor. It varies from suit to suit.
Notable Cases of Cyber-squatting
The following are some of the notable cases of cyber-squatting:-
Jennifer Lopez Case (2009)
The most famous case related to name-jacking cybersquatting is the Jennifer Lopez case (2009). It was decided by the WIPO Arbitration and Mediation Center. In this case, by making use of her name and adding the suffixes “.net” and “.org”, they were able to generate traffic and views on their domain names, which they had registered. The complainant pleaded for the website to be taken down as it makes use of the trademark name of the public personality to generate advertisements and earn profits; furthermore, they have not registered the name for use in the domain name. The respondent pleaded that the domain name is just a fan site and the advertisements generated are incidental; there is no bad faith that can be established. It was discussed by the panel that there is no dispute that the domain name has been used to take advantage of the celebrity’s fame, but it is important to draw further inferences and determine what would constitute bad faith. The court, after careful consideration, decided, by issuing an order directing the same, that the domain names in dispute have to be transferred from the respondent, who has them registered, to the complainant.
Ville de Paris v Salient Properties LLC
In another case of reverse cybersquatting at the WIPO Arbitration and Mediation Center, between the administrative authority of Paris and the domain name registration acquired by an LLC in the United States. The administrative authority was developing technologies for Paris, and in order to do so, they had registered several marks. One of the marks that the respondent had registered was found to be very similar to that of the complainant. This was one of the several other contentions raised, including that it is a business enterprise involved in commercial activities and that the domain name is also location-specific. It was held that the claims were unreasonable and that the complainants’ pleas were denied. Additionally, the respondent’s plea to find reverse cybersquatting was also denied. The complainant was also ordered to pay for such claims, attorney’s fees, and costs, as these were the damages awarded at the end of the suit.
United States v. Read (2022)
The infamous case of United States v. Read (2022) shows us how dangerous identity theft is and the extent to which one can pretend to be someone else in order to access such information. In this case, the defendant got access to Moore’s personal details, like her social security number and other information. Now, with access to such information, he continued to pose and present himself as her assistant. This helped him get identification badges and other cards to make it seem like he was actually her assistant. Now, he used this to his advantage and purchased big brand products, which amounted to thousands of dollars in a matter of a few weeks. He was eventually caught because he used his personal card along with the stolen card, which made it easy to trace and track him. He was thus ordered to pay at least half the sum he had spent on his shopping in New York as restitution. He also had to face fourteen months in a halfway house. The defendant, Read, had already faced charges for identity theft previously, and this was his second criminal charge proven successfully against him.
Shields v. Zuccarini (2001)
Another case we cannot skip out on related to typosquatting is Shields v. Zuccarini (2001). In this case, the plaintiff had a popular website to his name on which he published several animated versions of famous cartoons, which garnered several views. The defendant took advantage of this and registered five domain names similar to that of the plaintiff, as they were the misspellings of the plaintiff’s website, and once you get on that website, you are bombarded by advertisements, and you can leave only after exiting those pages. Thus, the defendant was able to generate revenue for himself. A suit was filed. The trial court and the appellate court came to the same decision. It was ultimately held that the defendant is liable to pay statutory damages of $10,000 per domain name and an additional amount to cover the fees of the attorney. In addition to that, the court also issued a permanent injunction in order to bring some relief to the plaintiff, who had suffered huge damage.
Gateway 2000 v Gateway Inc. (1997)
The case of Gateway 2000 v Gateway Inc. (1997) explores the scuffle between Gateway 2000 and Gateway Inc., which had the Gateway domain name registered in its name, several years before Gateway 2000 was even released. Even though Gateway 2000 took it to court, it failed to win the domain name in its favor. The court ruled that Gateway Inc. had registered the domain name 6 years prior to Gateway 2000 coming into existence and gaining fame after several years. There is no bad intention or advantage taken by the defendant in any manner. There is no way the defendant could have foreseen the possibility of Gateway 2000 gaining fame before it was released and registered a domain name similar to it.
Data Concepts Inc. v. Digital Consulting Inc. (1998)
In the case of Data Concepts Inc. v. Digital Consulting Inc. (1998), Data Concepts Inc., was the owner of the domain name, which went by “DCI”, and was engaged in managing the data of computer software. Digital Consulting Inc., provides computer-related educational and training services. Both of them had rights to the domain name going by “DCI”. The court took into account that Digital had registered the mark before Data. In addition to that, the intention of the registration should be taken into consideration. The problem that remains is that having similar abbreviations might cause confusion for the buyers.
Hasbro v. Clue Computing (1999)
In the case of Hasbro v. Clue Computing (1999), Clue was registered by Clue Computing. Hasbro filed before the court, citing infringement and saying that it should be dissolved. The court held that if you are the owner of the famous trademark, that does not imply that you will be entitled to use the same domain name as that of the trademark. There can be no monopolization of trademarks in domain names. It arrived at such a conclusion on the basis of an 8-factor analysis to determine whether or not it would amount to a trademark infringement or not.
Other Forms of Relief
In addition to the remedies discussed above, the plaintiff may be able to seek other forms of relief in cases of trademark infringement. These may include the destruction of infringing material, the delivery of infringing material to the plaintiff, and the payment of the plaintiff’s attorney’s fees. Attorney’s fees are determined by the Lanham Act, also known as Title 15 of the United States Code. Attorney’s fees are not awarded in all circumstances. If the plaintiff wins the suit in his or her favor, they are generally awarded attorney’s fees if the court deems it to be fit, and in cases where the suit is decided in favor of the defendant, the defendant is awarded attorney’s fees if the court deems it to be fit. The attorney’s fees are exorbitant at times, and the court might not order for all of them to be covered; they might be partially covered.
Strategies to combat Trademark Infringement
There are a few strategies that businesses can use to protect their trademarks from infringement.
The first is to register the trademark with the US Patent and Trademark Office (USPTO). This will give the business exclusive rights to use the trademark, and it will make it easier to enforce the trademark against infringement.
Steps to register your trademark with the USPTO
It is important to register your trademark at the United States Patent and Trademark Office (USPTO) to prevent any illegitimate use and protect it. The steps to register the trademark as per the United States Patent and Trademark Office (USPTO) are as follows:
Step 1: You will have to set up an account with the United States Patent and Trademark Office (USPTO) on their official website with the required details like an email address, contact details, etc., and validate the account using authentication.
Step 2: You will now have access to the Trademark Electronic Application System (TEAS), which allows you to file an application. On the basis of the type of trademark, a fee will have to be filed for processing. This fee will not be returned and an application does not imply registration of the trademark
Step 3: You will have to constantly observe the status of your application in order to not miss out on anything and furnish further details if required as per the deadlines set.
Step 4: During this long process, it is possible that you need to change personal details. This is possible, and it has to be diligently updated by the applicant in order to receive constant updates and stay in the loop about the application.
Step 5: After the basic requirements for filing the application are met, a serial number is assigned, and the application is then put forth for review. The review of such applications that have received serial numbers is done by the United States Patent and Trademark Office (USPTO) examining attorneys, which might take some additional months. The attorney is required to check the right amount of fees required to be paid, its compliance with legal provisions, whether such a trademark is registrable, etc. A comprehensive search is done related to the trademark.
Step 6: Subsequent to such an extensive review, the United States Patent and Trademark Office (USPTO) provides the applicant with a letter outlining the reasons for the refusal to grant the registration. In addition to this, the applicant may be contacted by phone or by the email they provided while applying.
Step 7: If an office action is sent, either the applicant or the applicant’s attorney has to provide the office with a reply to all the issues that the office has raised in the letter they had previously sent. Such a reply has to be sent within three months of an office action; if no reply is received, then the application is abandoned, but there is an option to extend it by three months provided a fee is deposited.
Step 8: If no further objections are raised in connection with the trademark, then it gets published. If the United States Patent and Trademark Office (USPTO) attorney approves it, then the office provides the applicant with a publication notice with the date of publication. Objections are invited during the United States Patent and Trademark Office (USPTO)’s publication of the same within 30 days of such publication. If there are no objections, then the application for a trademark enters the stage of registration. If there are any objections, they are addressed by the tribunal set up within the United States Patent and Trademark Office (USPTO), which is known as the Trademark Trial and Appeal Board (TTAB).
Step 9: In the registration stage, on the basis of the application filed for the trademark, additional documents are required to be produced. If there are no objections, the trademark is successfully registered, and the applicant now becomes the trademark owner and is provided with a certificate for the same.
Monitor the use of the trademark
The second is to monitor the use of the trademark. This can be done by monitoring websites, social media accounts, and other sources for any unauthorized use of the trademark.
Trademark monitoring becomes an essential measure that all trademark owners should take up in order to prevent the misuse of their trademarks. The objectives of the trademark monitoring system are as follows:
- To scan extensively all websites and conduct a search on them
- To scan extensively all social media platforms and conduct a search on them
- To detect any discrepancies, i.e possible infringements
- To keep track of any discrepancies, i.e possible infringements, happening
- To monitor the use of the trademark
- To track legitimate use of the trademark at its manufacturers, distributors and other businesses
- To detect any infringement early on to prevent counterfeiting
- To ensure effective scanning all across the globe in one place
- To protect brand image by scanning out illegitimate use of trademarks
- To ensure immediate action is taken on those who used the trademark illegitimately
If you are a trademark owner, you can also hire a law firm that will set up a team to monitor your trademark use and also discreetly work towards the possible other legal measures, whether preventive or remedial, to protect your trademark from infringement. A legal team might also help you to additionally register the trademark as per your needs and requirements. The legal team also provides assistance with other factors related to your trademark.
Immediate action against any infringement
Third, businesses should make sure to take swift action against any infringement. This could include sending cease-and-desist letters, filing an infringement lawsuit, or seeking other remedies.
To ensure that immediate action is taken, hire a legal team. The legal team is tasked with all the legal filings that are to take place in court and removes this burden from the shoulders of the trademark owner. Additionally, they assist in preparing all the documents required for filing a suit and communicating with the infringers about the action that is going to be taken against them.
A cease and desist letter looks like follows:
Sample Cease and Desist Notice for Trademark Infringement
NOTICE TO CEASE AND DESIST
Re: Trademark Infringement – Cease and Desist
It has come to our attention that you are making unauthorized use of the trademark [Name of Trademark] by …………………………… [Describe Infringement Use].
Under federal registration laws, we are the owners of the trademark …………………………… [Name of Trademark] is currently registered with the United States Patent and Trademark Office (USPTO) under the following registration number: ……………………………
Therefore, we have the right, including but not limited to, to restrict, prevent, or limit the use of our trademark in order to protect it against any misrepresentation.
We hereby demand that you immediately cease and desist from any additional use of our trademark that will likely cause misrepresentation in relation to the distribution, advertising, identification, and sales of our products or services.
If you fail to comply with the aforementioned demand(s) ……… within days, we will have no choice but to pursue all legal causes of action, including the filing of a lawsuit to protect our interests. We remind you that this letter serves as a pre-suit notice for a lawsuit against you, and failing to correct it will likely make you liable for any damages the court determines we have suffered as a result of your infringement.
It is in our best interests to have this issue amicably settled in an effort to avoid further legal remedies as provided by State and Federal laws.
Periodic Checks, Updating and Renewal of Trademarks
Finally, businesses should make sure to keep their trademarks updated. This could include registering trademarks in other countries, registering with trademark monitoring services, and updating the trademark registration with the USPTO.
Trademarks are subject to renewal, so it is important to follow the deadlines and regularly file your trademark documents, which allow for their maintenance at the United States Patent and Trademark Office (USPTO). In addition to that, if you are filing for your trademark in other countries that follow different protocols, then it is important to keep track of those deadlines, as they might differ from the United States Patent and Trademark Office (USPTO) deadlines. And most importantly, continue to use your trademark and update any changes on the website, like deletions and additions.
Common Misconceptions about Trademark Infringement
There are some common misconceptions about trademark infringement that businesses should be aware of.
First, businesses should not assume that they can stop someone from using their mark simply by sending a cease-and-desist letter. In most cases, the letter will only be effective if the person receiving it is aware that they are infringing on the trademark.
Second, businesses should not assume that they have to register a trademark with the USPTO in order to protect it from infringement. Although registration with the USPTO is a helpful step, it is not required in order to enforce a trademark.
Finally, businesses should not assume that trademark infringement is a minor issue that can be ignored. In many cases, trademark infringement can have serious consequences and can be costly to remedy.
Defects and Defenses to Trademark Infringement
- Under Section 1115 (a) of the Title 15 of the United States Code
Any registered mark can be provided as evidence and admissible as evidence in the court of law and such registration at the first look itself is more than enough to prove that the validity of the mark’s registration but that does not preclude a person from proving legal/equitable defense/defect present under Section 1115 (b) of the Title 15 of the United States Code and elaborated below.
- Under Section 1115 (b) (1) of the Title 15 of the United States Code
This section talks about the case where the mark was obtained fraudulently, in that case, no rights would be assigned for its use. This would be a defect.
- Under Section 1115 (b) (2) of the Title 15 of the United States Code
This section talks about the case where the mark has been deserted by its owner or the one who has registered it.
- Under Section 1115 (b) (3) of Title 15 of the United States Code
In case the mark that is registered is being used with the authorization of the registrant or another having a legal relationship with the registrant so as to cause damage by misrepresenting the goods/services associated with the mark in use.
- Statutory Fair Use
The provision of Statutory Fair Use is contained in the Lanham Act under Section 33(b) (4) of the Lanham Act in addition to Section 1115 (b) (4) of the Title 15 of the United States Code. According to Section 1115 (b) (4). In this case, it has to be proved the plaintiff has to prove that there was confusion on his part. But this defense is available to use only in exceptional circumstances.
- Under Section 1115 (b) (5) of the Title 15 of the United States Code
The mark that is registered has been used by the registrant and that such prior use was continuous in nature but there was no knowledge of any sorts of it and therefore, it becomes important to establish the following the three points (which are subject to proving continuous prior use):
- Date of use as per Section 1057 (c) of the Title 15 of the United States Code
- Registration filed is before the effective date under Trademark Law Revision Act
- Publication of such registered mark as per Section 1062 (c) of Title 15 of the United States Code
- Under Section 1115 (b) (6) of the Title 15 of the United States Code
The mark registered as per the provisions under elaborated in this section but it was not abandoned. This provision is subject to the mark being used prior to such registration or before the publication of the mark by the registrant, then it can be used as a defense in case of trademark infringement.
- Under Section 1115 (b) (7) of Title 15 of the United States Code
The registered mark in question is being used to breach any of the antitrust laws of the US, then it can be used as a defense in case of trademark infringement.
- Under Section 1115 (b) (8) of the Title 15 of the United States Code
The registered mark is currently in use and is functional, then it can be used as a defense in case of trademark infringement.
- Under Section 1115 (b) (9) of the Title 15 of the United States Code
Commonly known principles like laches, acquiescence and estoppel are applicable, then it can be used as a defense in case of trademark infringement.
- Anti-Disparagement Clause
An additional clause may be added. This is known as the anti-disparagement clause. As per this clause, trademarks that disparage any persons, living or dead, institutions, beliefs, national marks or bring all these categories into contempt or disrepute would not be awarded registration by the federal government. This is enshrined in the provision under Section 1052 (a) of the Title 15 of the United States Code. This clause is not just limited to the above-mentioned categories of items but also includes marks that may pose to be scandalous or deceptive or even immoral. The applicants are expected at the most to keep the following points in mind and ensure that their marks do not fall in the above-mentioned categories in order to ensure that they will successfully obtain a trademark registration.
Trademark infringement is a serious problem in the US, and the law provides a number of remedies for those who have been victims of trademark infringement. These remedies include injunctive relief, damages for profits, damages for counterfeiting, and damages for cybersquatting. Businesses can also take steps to protect their trademarks from infringement, such as registering the trademark with the USPTO, monitoring for unauthorized use of the trademark, taking swift action against infringement, and keeping their trademarks updated. Finally, businesses should be aware of common misconceptions about trademark infringement.
It is easy to become a victim of trademark infringement if you are not alert and aware of how you can protect your trademark and take preventive measures. It is important to keep in mind that the earlier you will register your trademark, the less risk your trademark faces in instances of trademark infringement. Your trademark is a unique intellectual property under your name and thus you should make use of every help available to you to protect your trademark.
If you have been the victim of trademark infringement, it is important to seek legal advice as soon as possible. An experienced attorney can help you understand your rights and remedies and protect your trademark from further infringement.
Frequently Asked Questions (FAQs) on Trademark Infringement
What is a trademark?
A trademark is defined under Section 1127 of Title 15 of the United States Code as any device, symbol, name, word, or combination of them that can help identify a product and set it apart from the rest. A trademark acts as a unique identification mark for the product. They may be used either by individuals or by businesses and help to determine the source of their products even in the absence of any mention of such a source.
What is trademark infringement?
Trademark infringement is the unauthorized use of trademarks (as defined above). The trademark may be registered, the trademark may be similar to the registered mark, and the trademark infringed should fall within the same class or category. Such infringement occurs in various forms and often gives an unfair advantage and profits to the infringer, leaving the original owner with losses.
What amounts to trademark infringement?
Any trademark that is registered or already in use being used by another without permission for it, using a trademark to create cheaper copies (counterfeiting), using a trademark to earn profits you are not entitled to, using a trademark hamper one’s name or product’s image and fame in society, using a trademark in same class and category of goods to bring down that product, etc.
What are the remedies available to the injured party?
There are several remedies available to the injured party. The injured party can seek damages from the infringer, which are of various kinds and whose valuation varies from suit to suit. In addition to this, the parties can also seek an injunction (of several kinds) from the court having jurisdiction over the matter. Courts also award compensation equal to profits earned illegitimately by the infringer. Courts also issue orders for the transfer of domain names if successfully proven.
Where can a case of trademark infringement be filed?
A case of trademark infringement can be filed in the federal courts, subject to the condition that it is a federal trademark dispute. Even state courts have jurisdiction over such matters. If it is filed in state court, only claims of state law violations will be heard. But if it is filed in federal court, both the state law violation and the federal law violation will be considered.
Does one require a licensed attorney to file a case with the United States Patent and Trademark Office (USPTO)?
Hiring a licensed trademark attorney will ease your burden of filling out the case, as they will assist you with the court proceedings and provide you with additional advice as to how to proceed. It is important to consult with an attorney specializing in this field, as it can be complex to understand the court requirements and proceedings.
- Weinberger V. Romero-Barcelo, 456 U.S. 305 (1982), 102 S. Ct. 1798, 72 L. Ed. 2d 91, 1982 U.S. LEXIS 34, 50 U.S.L.W. 4434, 12 ELR 20538, 17 ERC (BNA) 1217
- eBay Inc. v. MercExchange, L. L. C., 547 U.S. 388 (2006), 547 U.S. 388, 126 S. Ct. 1837, 164 L. Ed. 2d 641, 2006 U.S. LEXIS 3872, 78 U.S.P.Q.2D (BNA) 1577, 74 U.S.L.W. 4248, 27 A.L.R. Fed. 2d 685, 19 Fla. L. Weekly Fed. S 197
- Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7 (2008), 129 S. Ct. 365, 172 L. Ed. 2d 249, 2008 U.S. LEXIS 8343, 77 U.S.L.W. 4001, 39 ELR 20279, 67 ERC (BNA) 1225, 21 Fla. L. Weekly Fed. S 547
- Vuitton et Fils S.A, 606 F.2d 1 (2d Cir. 1979), 1979 U.S. App. LEXIS 12901, 204 U.S.P.Q. (BNA) 1, 27 Fed. R. Serv. 2d (Callaghan) 1432
- The Jennifer Lopez Foundation v. Jeremiah Tieman, Jennifer Lopez Net, Jennifer Lopez, Vaca Systems LLC, Case No. D2009-0057
- Ville de Paris v. Salient Properties LLC, Case No. D2009-1279
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