Petition for Writ of Certiorari — Dewberry Group, Inc., fka Dewberry Capital Corporation, Petitioner v. Dewberry Engineers Inc.

Supreme Court briefFeb 16, 2024

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APPENDIX

TABLE OF CONTENTS

Page

APPENDIX A:

Opinion of United States Court of Appeals

for the Fourth Circuit (Aug. 9, 2023) ................. 1a

APPENDIX B:

Order of the United States District Court

for the Eastern District of Virginia

Awarding Disgorgement (Mar. 2, 2022) ........... 62a

APPENDIX C:

Order of the United States District Court

for the Eastern District of Virginia

on Cross-Motions for Summary Judgment

(Aug. 11, 2021) .................................................. 96a

APPENDIX D:

Order of the United States Court of Appeals

for the Fourth Circuit Denying Rehearing

(Sept. 19, 2023) ............................................... 121a

APPENDIX E:

15 U.S.C. § 1117 .............................................. 123a

APPENDIX A

PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

________________________________

No. 22-1622

________________________________

DEWBERRY ENGINEERS INC.,

a New York corporation,

Plaintiff - Appellee,

DEWBERRY GROUP, INC.,

f/k/a Dewberry Capital Corporation,

a Georgia corporation,

Defendant - Appellant.

________________________________

No. 22-1845

________________________________

DEWBERRY ENGINEERS INC.,

a New York corporation,

Plaintiff - Appellee,

DEWBERRY GROUP , INC.,

f/k/a Dewberry Capital Corporation,

a Georgia corporation,

Defendant - Appellee.

________________________________

Appeal from the United States District Court for the

Eastern District of Virginia, at Alexandria.

Liam

O’Grady,

Senior

District

Judge.

(1:20-cv-00610-LO-IDD)

________________________________

Argued: May 3, 2023

Decided: August 9, 2023

________________________________

Before GREGORY, THACKER, and QUATTLEBAUM, Circuit Judges.

________________________________

Affirmed by published opinion. Judge Gregory wrote

the opinion, in which Judge Thacker joined. Judge

Quattlebaum wrote a dissenting opinion.

________________________________

ARGUED: Gail Ellen Podolsky, CARLTON FIELDS,

PA, Atlanta, Georgia, for Appellant. Elbert Lin,

HUNTON ANDREWS KURTH, LLP, Richmond, Virginia, for Appellee. ON BRIEF: Daniel Felsen,

CARLTON FIELDS, PA, Washington, D.C., for Appellant. Arthur E. Schmalz, Washington, D.C., Stephen

P. Demm, Brian A. Wright, David M. Parker,

HUNTON ANDREWS KURTH LLP, Richmond, Virginia, for Appellee.

________________________________

GREGORY, Circuit Judge:

Two companies that operate in the real estate development industry have spent years embroiled in a

dispute over their shared name: “Dewberry.” This appeal concerns their latest spat—Dewberry Engineers

has sued Dewberry Group to quell the latter’s use of

several new insignias it developed as part of its rebrand. Dewberry Engineers owns federal trademark

rights to the “Dewberry” mark and claims Dewberry

Group’s rebranding efforts infringe that mark and

breach an agreement struck between the sparring corporations over a decade ago. The district court sided

with Dewberry Engineers in the proceedings below,

assessing a nearly $43 million profit disgorgement

award against Dewberry Group for its infringement,

enjoining it from further breaches of its agreement

with Dewberry Engineers, and ordering it to pay attorneys’ fees for forcing Dewberry Engineers to litigate an exceptional case of trademark infringement.

We affirm the district court’s judgments.

This dispute includes not one, but two businesses

bearing the “Dewberry” name while engaged in commercial real estate development. The first, Dewberry

Engineers, started in the mid-1950s as a civil engineering and surveying firm in Northern Virginia.

Over time, its business expanded to include real estate development services such as architecture and

site development, among other offerings. Although

the firm’s title cycled through different iterations involving the name “Dewberry” over the years, it presently operates as Dewberry Engineers. Dewberry Engineers provides its services through affiliated

entities under common ownership and control to clients all over the United States—Georgia, Virginia,

Florida, and South Carolina in particular.

The second business, Dewberry Group, similarly

provides real estate development services through its

affiliates, all of which are owned by real estate developer John Dewberry. The Atlanta, Georgia-based

Dewberry Group exclusively serves John Dewberry

and Dewberry Group’s affiliates who in turn lease

commercial property to tenants in Georgia, Virginia,

South Carolina, and Florida.

Whatever peaceful coexistence the parties enjoyed

ended in 2006 when each confronted the other over

their competing “Dewberry” brands.

Dewberry

Group—then called Dewberry Capital—struck first by

sending Dewberry Engineers a cease-and-desist letter

that asserted “a likelihood of confusion or mistake exists between the parties’ respective marks.” J.A.

3714–15. It argued that, although Dewberry Engineers held a federal trademark for “Dewberry,” Dewberry Group had senior common law rights to the use

of “Dewberry” in connection with real estate development and related services.

Dewberry Engineers agreed that the marks are

confusingly similar and escalated matters to a lawsuit

against Dewberry Group for trademark infringement.

Dewberry Engineers argued that it would be harmed

by Dewberry Group’s use of its “Dewberry” mark because both parties used their marks in connection

with real estate development services. Dewberry

Group counterclaimed for common law infringement,

claiming that Dewberry Engineers’ marks “so resemble Dewberry Capital’s DEWBERRY CAPITAL mark

. . . as to be likely to cause confusion, mistake, or deception when used in connection with real estate

development services.” J.A. 2463–64. Pertinent to the

parties’ competing allegations, the U.S. Patent and

Trademark Office (“USPTO”) had made an initial

finding by then that there was a likelihood of confusion between “Dewberry” and “Dewberry Capital,” declining registration of “Dewberry Capital” on that basis.

That litigation did not reach the merits, however,

because the parties signed a confidential settlement

agreement (the “CSA”) in 2007. The CSA allows Dewberry Engineers to use its registered marks freely,

and prevents Dewberry Group from challenging these

registrations:

4. [Dewberry Engineers] may use its DEWBERRY marks and names at any time for any

services or products it chooses throughout the

United States and elsewhere.

...

8. [Dewberry Group] . . . shall withdraw any

pending challenges to [Dewberry Engineers’]

federal trademark registrations, and shall not

challenge or take action against Dewberry’s

federal trademark registrations.

J.A. 1198–99 ¶¶ B.4, B.8. By contrast, the CSA

strictly limits Dewberry Group’s use of “Dewberry”:

2. Except as provided in Paragraph B.3, below, . . . [Dewberry Group] may use the DEWBERRY CAPITAL name and mark in connection with its promotion, offering and performance of real estate development services.

...

3. To the extent that [Dewberry Group] performs any . . . real estate development or

related services in [Virginia, D.C., or Maryland], it shall do so only under the name and

mark DCC and not under the name or mark

DEWBERRY CAPITAL.

...

5. [Dewberry Group] will expressly abandon

any pending applications to register the

DEWBERRY CAPITAL mark for real estate

development and/or real estate related services.

...

6. [Dewberry Group] will not use the word

DEWBERRY . . . in connection with any architectural or engineering services.

...

10. Where feasible, [Dewberry Group] shall

continue to use its column logo . . . . [Dewberry Group] shall not use a logo or design

mark that depicts a “dewberry” or “berry,”

and [Dewberry Group] shall not use a logo or

design mark that is confusingly similar to

[Dewberry Engineers’] “dewberry” logo and

design mark . . . .

Id.

Dewberry Engineers also agreed not to oppose

Dewberry Group’s then-pending applications to register five specific Dewberry-related marks. And both

parties agreed to dismiss their claims in the prior litigation and released each other from any claims they

“could have asserted” there. J.A. 1200–01 ¶¶ B.14–

B.15.

For a time, the parties retreated to the status quo.

The armistice dissolved in 2017, however, when Dewberry Group decided to revamp its brand. After the

successful launch of The Dewberry® hotel in Charleston, South Carolina, John Dewberry decided to

change the suffix “Capital” to “Group,” which would

better align with the company’s expansion into providing services for hospitality properties. John Dewberry

also adopted several sub-brands: “Dewberry Living,”

“Dewberry Office,” and “Studio Dewberry.” Dewberry

Group went further by creating a new logo that featured the letter D within a circle. When rebranding

began, John Dewberry did not inform Dewberry

Group’s then-general counsel, David Groce, of the

prior litigation or the CSA. Instead, he asked Groce

to “do a search” for related trademarks. J.A. 3217.

That search revealed Dewberry Engineers’ “Dewberry” mark. Even after this, it appears that as of

January 2018, Groce still was unaware of the CSA between the parties.

As a part of its rebranding efforts, Dewberry

Group applied to register “Dewberry Group” with the

USPTO for “[c]ommercial real estate development services.” J.A. 1859–64. The USPTO rejected this application on December 20, 2017, “because of a likelihood

of confusion” with the Dewberry Marks. J.A. 1841. It

explained that the “dominant wording DEWBERRY”

in both marks was “identical in sound, meaning and

essentially identical in appearance” and the parties’

services were “highly related.” J.A. 1841–42. A week

later, Dewberry Engineers sent Dewberry Group a letter objecting to its use of “Dewberry Group.” Groce responded on January 11, 2018, “regret[ting] any concern” Dewberry Group caused and claiming he had

not been “aware of the prior litigation or the [CSA]”

and “ha[d] no intent to infringe [Dewberry Engineers’]

valid trademark rights or to breach the terms of the

settlement agreement.” J.A. 3826. He further promised “not to attempt to register the term DEWBERRY

GROUP for real estate development services,” or to

“use the term in connection with any present or future

real estate development or related services in Virginia, Maryland, or the District of Columbia.” Id. Instead, he promised to “use DCC or something else that

is not confusingly similar to [Dewberry Engineers’]

marks.” Id.

In February 2018, Dewberry Group abandoned its

first “Dewberry Group” application but continued rebranding, using “Dewberry Group” and “Studio Dewberry” marks on all “existing & future marketing material,” J.A. 3227, including “all new leasing materials,” J.A. 3239. It later used these marks on new letterhead, business cards, email signatures, uniforms,

and property signs.

Despite Groce’s promises, Dewberry Group also

applied to register four new “Dewberry” marks in

April 2018: “D Dewberry Group,” “Studio Dewberry,”

“D Dewberry Living,” and “D Dewberry Office.” All

four were for real estate-related services. In response,

the USPTO required Dewberry Group to disclaim the

words “Group,” “Studio,” “Living,” and “Office” (meaning Dewberry Group would not claim exclusive rights

to those descriptive terms), leaving “Dewberry” as the

only distinctive element.

In June 2018, Dewberry Engineers sent its second

cease-and-desist letter demanding that Dewberry

Group withdraw the applications for these new

marks. Dewberry Engineers warned that Dewberry

Group was intentionally infringing Dewberry Engineers’ marks, breaching the CSA, and breaking

Groce’s recent promises. Dewberry Group refused to

abandon the applications, claiming that the parties’

marks were not confusingly similar, and that the CSA

allowed its use of “Dewberry” marks other than “Dewberry Capital” for non-architectural services. Dewberry Engineers responded with a third cease-and-desist letter in July 2018, insisting again that Dewberry

Group abandon its “Dewberry” marks. It explained

that Dewberry Group had misread the CSA, and that

Dewberry Group’s new marks only increased the likelihood of confusion by eliminating “Capital”—which

provided the financial connotation serving to distinguish the parties’ marks. Dewberry Engineers also

warned that Dewberry Group’s marks had already

“caused confusion in both the Charlottesville[, Virginia] area and the Northern Virginia area.” J.A.

3831.

Meanwhile, Dewberry Engineers challenged Dewberry Group’s applications at the USPTO. The

USPTO rejected these applications due to a “likelihood of confusion” with Dewberry Engineers’ marks.

J.A. 2078. Like “Dewberry Group,” it found, for example, that “Studio Dewberry” was “confusingly similar”

to Dewberry Engineers’ marks, and the parties’ services were “similar and related,” particularly Studio

Dewberry’s “interior and exterior design for real estate.” J.A. 2079. The USPTO reaffirmed those rejections after Dewberry Group had asked for reconsideration.

Dewberry Engineers filed this action in May 2020,

claiming breach of contract and trademark infringement under the Lanham Act and Virginia common

law. The district court entered summary judgment in

favor of Dewberry Engineers on both claims. See Dewberry Eng’rs, Inc. v. Dewberry Grp., Inc. (Dewberry I),

10a

No. 1:20-CV-00610, 2021 WL 5217016, at *1 (E.D. Va.

Aug. 11, 2021).

With respect to breach of contract, the district

court found the plain language of the CSA unambiguous. Id. at *2. Then it held that Dewberry Group violated paragraphs B.2, B.3, B.6, and B.10. Id. Supporting that conclusion, the district court looked to

Dewberry Group’s admitted use of the “Dewberry”

mark within its promotional materials for “Studio

Dewberry,” which Dewberry Group touts for its architectural designs. Id. at *2–3. Next, the district court

found that “[a]ccording to the terms of the CSA, [Dewberry Group] was obliged to continue using the column logo. Instead, [Dewberry Group] chose a new

logo as part of its larger rebranding efforts.” Id. at *4.

That, the district court reasoned, directly violated the

CSA. Id. Finally, the district court held that “[w]here

[Dewberry Group] is shown to have performed real estate development activities in the Commonwealth of

Virginia either (1) under the mark ‘Dewberry Capital’

or (2) not under the mark ‘DCC,’ it is in breach.” Id.

at *5. Because it was “not difficult to find examples of

such activities” the district court concluded that Dewberry Group violated paragraphs B.2 and B.3. Id.

As to trademark infringement, the court decided

that Dewberry Engineers “established that the ‘Dewberry’ mark is valid, legally protected, and, having

been in continuous use for more than five years following its registration, incontestable.” Id. at *6. The

question left to decide was whether application of a

nine-factor test left any dispute that there was a likelihood of confusion between the parties’ respective

marks. The district court found no dispute on that

question given: the similarity of the marks; the parties services and the regions in which they operate;

11a

the instances of actual marketplace confusion in the

record; the investment by Dewberry Engineers into

the goodwill of its trademark; and the evidence of negative publicity threatening to tarnish that goodwill

due to confusion between Dewberry Engineers’ and

Dewberry Group’s marks. Id. at *11.

The district court later held a three-day bench

trial to calculate damages. Dewberry Eng’rs, Inc. v.

Dewberry Grp., Inc. (Dewberry II), No. 1:20-CV-00610,

2022 WL 1439826, at *1 (E.D. Va. Mar. 2, 2022). Following this Court’s test set forth in Synergistic International, LLC v. Korman, 470 F.3d 162, 175 (4th Cir.

2006), the district court found profit disgorgement appropriate. Dewberry II, 2022 WL 1439826, at *8–9.

But because Dewberry Group provided its infringing

services to affiliate companies under common ownership, the court found that the revenues associated

with Dewberry Group’s conduct appeared on the affiliates’ balance sheets. Id. at *9. Consequently, the

court treated Dewberry Group and its affiliates as a

single corporate entity for the purpose of calculating

revenues and profits generated by Dewberry Group’s

use of infringing marks. Id. at *10. The court determined that the tax information Dewberry Group presented did not reflect the “economic reality” of Dewberry Group’s relationship with its affiliates. Id. And

to account for some revenues unrelated to infringement, as well as costs, the district court reduced Dewberry Engineers’ requested award of $53,719,657 by

twenty percent—awarding Dewberry Engineers

$42,975,725.60 in disgorgement profits. Id. at *13–14.

Finally, the district court found this to be an “exceptional case” meriting an attorneys’ fees award under

the Lanham Act. Id. at *13.

12a

In a later order, the district court issued a permanent injunction that prevents Dewberry Group from

using the “Dewberry” mark in connection with real estate development services, except as permitted by the

CSA. See Dewberry Engineers Inc. v. Dewberry Grp.,

Inc. (Dewberry III), No. 1:20-CV-610-LO-IDD, 2022

WL 1439105, at *5 (E.D. Va. May 6, 2022).

Dewberry Group timely appealed all three district

court orders.

II.

Dewberry Group first challenges the district

court’s grant of summary judgment to Dewberry Engineers on its breach of contract and trademark infringement claims. We review summary judgment decisions de novo. Lee v. Town of Seaboard, 863 F.3d

323, 327 (4th Cir. 2017). “The narrow questions before

us on summary judgment are whether any genuine issues of material fact exist for the jury and if not,

whether the district court erred in applying the substantive law.” Id. Thus, we will grant summary judgment “only if, taking the facts in the best light for the

nonmoving party, no material facts are disputed and

the moving party is entitled to judgment as a matter

of law.” Ausherman v. Bank of Am. Corp., 352 F.3d

896, 899 (4th Cir. 2003).

Beginning with the breach of contract claim, Dewberry Group argues that material disputes of fact warrant reversal of the district court’s conclusions that

Dewberry Group violated the CSA. A claim for breach

of contract consists of “(1) a legally enforceable obligation of a defendant to a plaintiff; (2) the defendant’s

violation or breach of that obligation; and (3) injury or

damage to the plaintiff caused by the breach of

13a

obligation.” Navar, Inc. v. Fed. Bus. Council, 784

S.E.2d 296, 299 (Va. 2016). No one disputes that the

CSA is a valid and enforceable contract. The district

court found the CSA unambiguous, and that Dewberry Group breached several paragraphs therein.

Paragraph B.6 of the CSA reads: “[Dewberry

Group] will not use the word DEWBERRY in the

name of, or as a mark for, any architectural and/or engineering company, or in connection with any architectural or engineering services.” J.A. 1198. The district court found that Dewberry Group violated that

provision on account of its promotional materials, like

the Studio Dewberry webpage touting its architectural designs, see J.A. 2606–09, its promotional article

in Architectural Record magazine, see J.A. 3616–18;

1262, and its architectural filings for the Dewberry

Charlottesville building, see J.A. 2614–30; see also

J.A. 1193 (crediting “Studio Dewberry” as one of its

architects on leasing packages provided to clients).

Each of these instances presented uncontroverted evidence that Dewberry Group used the “Dewberry”

mark while providing architectural or engineering

services. In addition, the district court found that

these services benefited third parties, despite Dewberry Group’s argument that it only provided internal

services. For example, Dewberry Group prepared

drawings in connection to a zoning approval for a

downtown City of Charlottesville building project on

behalf of the project’s owner, Deerfield Square Associates, II, LLC. Even more, the court found that “the

services performed by [Dewberry Group] were in order

to serve as a distinguishing mark of luxury, for the

benefit of the tenants, investors, and brokers.” Dewberry I, 2021 WL 5217016, at *4.

14a

Paragraph B.10 states that “[w]here feasible,

[Dewberry Group] shall continue to use its column

logo in its current format . . . or in a substantially similar format.” J.A. 1199. The district court concluded

that because Dewberry Group “chose a new logo as

part of its larger rebranding efforts” it breached its obligation that it “shall continue” to use the column logo.

Dewberry I, 2021 WL 5217016, at *4.

Paragraph B.2 provides:

Except as provided in Paragraph B.3, below,

[Dewberry Group] may use the DEWBERRY

CAPITAL name and mark in connection with

its promotion, offering and performance of

real estate development services as a real estate developer, including purchasing real

property, arranging for the construction of

commercial and residential buildings and

mixed use properties, and leasing and managing properties.

J.A. 1198. Paragraph B.3, in turn, mandates that

Dewberry Group “shall” use “the name and mark DCC

and not under the name or mark DEWBERRY CAPITAL” if it “performs any present or future real estate

development or related services in the Commonwealth

of Virginia, the State of Maryland, or the District of

Columbia.” Id. The district court held that “[e]very

time [Dewberry Group] performed such real estate development activities in Virginia—whether procuring

financing, purchasing property, or submitting plans to

the Board of Architectural Review—doing so under

the ‘Dewberry’ mark (or conversely, not under the

DCC mark), it was in breach of the CSA.” Dewberry I,

2021 WL 5217016, at *5.

15a

Dewberry Group raises four arguments why we

should set this analysis aside. But each fails to persuade us of any latent error in the district court’s conclusions.

First, Dewberry Group revives its argument, rejected by the district court, that the CSA is ambiguous

as to the meaning of “where feasible” in paragraph

B.10 but it adds nothing of substance to convincingly

suggest ambiguity. And our review reveals none.

Second, Dewberry Group argues that the district

court should have considered parol evidence that the

parties intended paragraphs B.2 and B.3 to apply only

to “public facing” project names. Opening Br. 49. In

Virginia, however, parol evidence is inadmissible if

the CSA was “intended also as a complete and exclusive statement of the terms of the agreement.” Va.

Code Ann. § 8.2-202. And the CSA paragraph B.22

explicitly states that the “[p]arties expressly agree

that they will not attempt in the future to argue that

there were any other written or oral understandings

or agreements between the [p]arties, as of the date of

this Agreement, that are not expressly contained in

this Agreement.” J.A. 1203.

Third, Dewberry Group argues that its “in-house”

activities were not technically architectural because

they “do not require an architectural license.” Opening Br. at 48. That distinction is fanciful and unsupported. As a matter of Virginia law, “[t]he ‘practice of

architecture’ means any service wherein the principles and methods of architecture are applied, such as

consultation, investigation, evaluation, planning and

design, and includes the responsible administration of

construction contracts.” Va. Code Ann. § 54.1-400.

There is no dispute that Dewberry Group’s activities

16a

(such as the Charlottesville project) provided some of

these services.

Its fourth and final argument is that Dewberry

Engineers did not establish an injury stemming from

these breaches. The district court concluded that

Dewberry Group’s “negative publicity damages [Dewberry Engineers’] positive reputational standing.”

Dewberry I, 2021 WL 5217016, at *10 (cleaned up).

For example, Dewberry Engineers provided evidence

of negative publicity that mistakenly attributed Dewberry Group’s Charlottesville development project—

which news articles described as an “eyesore” and

“blight,” J.A. 2751–52, a “long-languishing” “skeletal

building,” J.A. 2731, “violat[ing] building code[s],” J.A.

2743, and containing “so many rats” that “it looked

like the ground was moving,” id.—to Dewberry Engineers because the project bore the “Dewberry” name.

Such reputational harm is sufficient to demonstrate irreparable injury flowing from the breach of a

settlement agreement restricting the breaching

party’s use of a trademark. See, e.g., Dynamic Aviation Grp. Inc. v. Dynamic Int’l Airways, LLC, No. 5:15CV-00058, 2016 WL 1247220 at *28–29 (W.D. Va.

Mar. 24, 2016) (collecting cases supporting the proposition that “[l]oss of goodwill and industry reputation

can constitute irreparable harm for” both a contract

and infringement claim); see also Worrie v. Boze, 62

S.E.2d 876 (Va. 1951) (acknowledging irreparable injury may be shown without showing actual damage

attendant to the breach of a non-competition agreement). Accordingly, we find no fault with the district

court’s conclusion that Dewberry Engineers suffered

a cognizable injury stemming from Dewberry Group’s

breach of the CSA.

17a

Dewberry Group also claims that it did not infringe Dewberry Engineers’ trademark in violation of

the Lanham Act. The Lanham Act protects trademark registrants from “any reproduction, counterfeit,

copy, or colorable imitation of a registered mark” by

allowing the registrant to commence a civil action

against trademark infringers for disgorgement of

profits or other damages. 15 U.S.C. § 1114(1). To

demonstrate trademark infringement, a plaintiff

must show both (1) “that it owns a valid and protectable mark,” and (2) “that the defendant’s use of a ‘reproduction, counterfeit, copy, or colorable imitation’ of

that mark creates a likelihood of confusion.” CareFirst of Md., Inc. v. First Care, P.C., 434 F.3d 263, 267

(4th Cir. 2006) (quoting § 1114(1)(a)).

The district court entered summary judgment in

favor of Dewberry Engineers because it found a likelihood of confusion between Dewberry Engineers’ “Dewberry” trademark and Dewberry Group’s “Dewberry”

branding. But Dewberry Group finds two problems

with the district court’s analysis. As a threshold matter, Dewberry Group faults the district court for failing to address its defense that it used the “Dewberry”

mark prior to Dewberry Engineers’ first use. Dewberry Group also disputes the district court’s likelihood-of-confusion determination.

We ultimately

agree with the district court.

We first address Dewberry Group’s contention

that Dewberry Engineers is not entitled to judgment

as a matter of law because Dewberry Group has priority over the “Dewberry” mark.

18a

The notion that “federal law does not create trademarks” is a foundational precept of United States

trademark law. See 2 J. Thomas McCarthy, McCarthy

On Trademarks and Unfair Competition § 16:18 (5th

ed.) (collecting cases). Instead, “[o]ne who first uses a

distinct mark in commerce [] acquires rights to that

mark.” B & B Hardware, Inc. v. Hargis Indus., Inc.,

575 U.S. 138, 142 (2015). Consequently, the Lanham

Act helps to “protect marks” already in use. Id. To

that end, it allows the owner of a trademark to register that mark, granting the registrant substantial

benefits. Registration provides “constructive notice of

the registrant’s claim of ownership” of the mark, 15

U.S.C. § 1072, and serves as “prima facie evidence of

the validity of the registered mark,” § 1057(b). Even

more, a mark can become “incontestable” once it has

been registered for five years upon the satisfaction of

four other criteria. See id. §§ 1065, 1115(b).

Another way the Lanham Act aids trademark registrants is the private right of action it authorizes

against alleged infringers. In an infringement suit involving a mark that has become incontestable, “registration is conclusive evidence of the registrant’s exclusive right to use the mark, subject to [some] conditions” found in § 15 and “the seven defenses enumerated in § 33(b) itself.” Park ‘N Fly, Inc. v. Dollar Park

& Fly, Inc., 469 U.S. 189, 196 (1985) (holding that a

trademark may not be challenged as merely descriptive once it becomes incontestable); see also 15 U.S.C.

§ 1115(a). Because a mark ultimately belongs to

whomever used it first, “prior use” is one of those enumerated defenses available to defeat a trademark registrant’s claim that a mark has become incontestable.

See 15 U.S.C. § 1115(b)(5).

19a

When Dewberry Group raised this defense below,

the district court responded simply that Dewberry Engineers “established that the ‘Dewberry’ mark is valid,

legally protected, and, having been in continuous use

for more than five years following its registration, incontestable.” Dewberry I, 2021 WL 5217016, at *6.

But it spoke nothing of Dewberry Group’s prior use

defense, which remains available to refute an incontestable trademark. Dewberry Group now urges reversal because its reading of the record evidence creates a genuine dispute of fact about which party first

used the “Dewberry” name.

The district court’s silence on the issue notwithstanding, Dewberry Group’s priority argument cannot

succeed. On its version of the facts, Dewberry Group

has long used “Dewberry”—as early as the 1980s—

while Dewberry Engineers claimed its first use in

2003. Assured of a competent jury’s facility with

arithmetic, Dewberry Group contends the prior use

question should be reserved for trial. Whatever the

merits of this argument, it is foreclosed by a key piece

of evidence: paragraph B.8 of the CSA states that

Dewberry Group “shall not challenge or take action

against Dewberry[] [Engineers’] federal trademark

registrations.” J.A. 1199 (emphasis added). Claiming

prior use of a trademark is a challenge against its validity. See Marcon, Ltd. v. Helena Rubenstein, Inc.,

694 F.2d 953, 956 (4th Cir. 1982). Dewberry Group

thus waived the priority issue when it agreed to the

CSA. See Beer Nuts, Inc. v. King Nut Co., 477 F.2d

326, 328 (6th Cir. 1973) (holding that a prior settlement agreement recognizing the validity of the plaintiff’s trademark precluded the defendant’s claim that

the mark had become descriptive in a later infringement suit as “an attack upon the validity of the trademark”).

20a

Dewberry Group pushes back, claiming that a

“prior use defense is not a challenge to the validity of

Dewberry Engineers’ trademark registrations. . . .

Rather it is a recognized defense to an infringement

action.” Reply Br. at 3. In the context of this case,

however, that is a distinction without a difference.

The Lanham Act allows litigants to raise prior use either as a ground for cancelation of a registration

mark, Marcon, 694 F.2d at 956, or as an affirmative

defense to infringement of a registered mark,

§ 1115(b)(5). Those avenues are distinct to be sure.

Recall, though, that whoever “first uses a distinct

mark in commerce [] acquires rights to that mark.”

B & B Hardware, Inc., 575 U.S. at 142. A trademark

merely provides prima facie evidence, or conclusive

evidence in the case of an incontestable mark, of the

mark’s “validity” and the “registrant’s ownership and

exclusive right to use the registered mark.” 15 U.S.C.

§ 1115(b) (emphasis added). And registration is no

guarantee of ownership because the validity of even

incontestable marks is susceptible to proof of the affirmative defenses found in § 1115(b), one of which is

prior use. So, whether a party claims prior use to

preempt the creation of a federal trademark registration, to cancel an existing mark, or in defense of a federal trademark infringement suit, the result is the

same: an attack on the validity of that mark.

We therefore need not delve into Dewberry

Group’s claimed dispute about priority of use. Dewberry Group may very well have priority over the

mark, but it waived its right to assert that claim when

it agreed not to challenge Dewberry Engineers’ trademark registrations. Thus, our review yields nothing

to disturb the district court’s conclusion that Dewberry Engineers’ trademark is incontestable.

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We now evaluate Dewberry Group’s position that

disputes of fact remain about whether a likelihood of

confusion exists between its own branding and Dewberry Engineers’ “Dewberry” mark. The likelihood of

confusion piece to the infringement puzzle is “a matter

of varying human reactions to situations incapable of

exact appraisement.” Anheuser-Busch, Inc. v. L & L

Wings, Inc., 962 F.2d 316, 318 (4th Cir. 1992) (internal

quotation marks omitted). Short of an exact measurement of the confusion that may exist between two

marks, courts have devised nine factors useful to the

analysis: “(1) the strength or distinctiveness of the

plaintiff’s mark as actually used in the marketplace;”

“(2) the similarity of the two marks to consumers;”

“(3) the similarity of the goods or services that the

marks identify;” “(4) the similarity of the facilities

used by the [parties];” “(5) the similarity of advertising

used by the [parties];” “(6) the defendant’s intent;”

“(7) actual confusion;” “(8) the quality of the defendant’s product;” “and (9) the sophistication of the consuming public.” Grayson O Co. v. Agadir Int’l LLC,

856 F.3d 307, 314 (4th Cir. 2017).

In considering the question of confusion, it is important to maintain perspective. The above-listed factors are “non-exclusive and non-mandatory,” “serve as

a guide rather than ‘a rigid formula’” and “are not all

of equal importance” or “relevant in every case.”

Swatch AG v. Beehive Wholesale, LLC, 739 F.3d 150,

158–59 (4th Cir. 2014) (quoting George & Co., LLC v.

Imagination Ent. Ltd., 575 F.3d 383, 393 (4th Cir.

2009)). And, although this element is “frequently a

fairly disputed issue of fact on which reasonable

minds may differ,” Anheuser-Busch, Inc., 962 F.2d at

22a

318, summary judgment can still be appropriate when

the record does not create a genuine issue of material

fact, RXD Media, LLC v. IP Application Dev. LLC, 986

F.3d 361, 375 (4th Cir. 2021) (“Nevertheless, as with

any other issue of fact, summary judgment remains

appropriate when no jury reasonably could have ruled

in the non-moving party’s favor.”).1 Hence, the district

court held that Dewberry Engineers is entitled to

summary judgment after finding just seven factors

relevant but concluding that six supported a likelihood of confusion. Dewberry Group contests all but

one of those six factors. We consider each in turn.

The first factor the district court considered was

the strength or distinctiveness of the Dewberry Engineers’ mark as actually used in the marketplace. This

factor is “‘paramount’ in determining the likelihood of

confusion” because consumers are unlikely to associate a weak or undistinctive mark with a unique source

“and consequently will not confuse the allegedly infringing mark with the senior mark.” Grayson O, 856

F.3d at 314–15 (quoting Pizzeria Uno Corp. v. Temple,

747 F.2d 1522, 1527 (4th Cir. 1984)). The mark’s

See also CareFirst of Md., Inc., 434 F.3d at 274 (affirming

summary judgment for the defendant where no factor supported

a likelihood of confusion); Scotch Whisky Ass’n v. Majestic Distilling Co., 958 F.2d 594, 598–99 (4th Cir. 1992) (affirming summary judgment for defendant because the Court “simply d[id] not

believe that there [was] a genuine issue of fact as to whether the

public [would] be deceived”); Polo Fashions, Inc. v. Craftex, Inc.,

816 F.2d 145, 148–49 (4th Cir. 1987) (“[W]e think that the likelihood of confusion was so unassailably established as to warrant

the district court’s entry of summary judgment for the plaintiff

as to liability.”).

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overall strength or distinctiveness “comprises both

conceptual strength and commercial strength.” Id. at

315.

“Measuring a mark’s conceptual or inherent

strength focuses on the linguistic or graphical ‘peculiarity’ of the mark, considered in relation to the product, service, or collective organization to which the

mark attaches.” CareFirst, 434 F.3d at 269 (quoting

Perini Corp. v. Perini Constr., Inc., 915 F.2d 121, 124

(4th Cir. 1990)). The mark’s “peculiarity” is measured

by “placing the mark ‘into one of four categories of distinctiveness: (1) generic; (2) descriptive; (3) suggestive; or (4) arbitrary or fanciful.’” Grayson O, 856 F.3d

at 315 (quoting George & Co., 575 F.3d at 393–94).

In the proceedings below, Dewberry Group argued

that the “Dewberry” mark is conceptually weak because it is a surname, rendering it descriptive. The

district court rejected that claim because “[t]aken as a

whole, the mark and the ‘berry’ logo do not suggest a

surname.” Dewberry I, 2021 WL 5217016, at *7. Instead, it considered the USPTO’s decision not to require proof of secondary meaning, indicating that it

did not consider the mark descriptive. Id. “These

facts, read in conjunction with the fact that ‘Dewberry’

neither suggests nor describes the services provided

by [Dewberry Engineers],” the court continued, “lead

to the finding that the mark is arbitrary, which is conceptually strong.” Id.

On appeal, Dewberry Group asserts that the district court made short shrift of its argument that the

surname “Dewberry” weakens the distinctiveness of

the “Dewberry” mark. It contends that “[s]urnames

are never assumed to be ‘distinctive’” and courts are

loath to constrain and “to prohibit an individual from

use of his or her name in commerce.” Opening Br. at

24a

29 (citing John B. Stetson Co. v. Stephen L. Stetson

Co., 128 F.2d 981, 984 (2d Cir. 1942)).

Dewberry Group’s surname argument is unpersuasive. For one, it does not meaningfully dispute the

district court’s reasoning that “Dewberry” does not

suggest or describe the services provided by Dewberry

Engineers. And, given that “Dewberry” plainly may

refer to fruit, it is an arbitrary mark, much like “Apple

computers” refers both to a fruit and a consumer computer products company without describing the company’s services or products. See Sara Lee Corp. v.

Kayser-Roth Corp., 81 F.3d 455, 464 (4th Cir. 1996)

(“Examples [of arbitrary marks] include Tea Rose®

flour, Camel® cigarettes, and Apple® computers.”). It

is also undisputed that, as the district court noted, the

USPTO did not require proof of secondary meaning

when it registered Dewberry Engineers’ “Dewberry”

mark, as would be required for a descriptive mark.

See Lone Star Steakhouse & Saloon, Inc. v. Alpha of

Virginia, Inc., 43 F.3d 922, 936 n.15 (4th Cir. 1995)

(“The fact that the Trademark Office did not require

proof of secondary meaning can be determined from

analyzing a title copy of the registration the Office issued.”). So, the district court did not merely “assume”

the “Dewberry” mark’s distinctiveness as a surname;

it made its distinctiveness determination based on uncontroverted evidence in the record.

Additional record facts only bolster the district

court’s conclusion. For instance, Dewberry Engineers

offered branding studies indicating that consumers in

the real estate industry “refer to [Dewberry Engineers] simply as ‘Dewberry’” and associate the mark

with “knowledge, quality and strong client service.”

J.A. 7743. A branding awareness study can be an effective yardstick for determining a mark’s

25a

distinctiveness. See, e.g., Citigroup Inc. v. Cap. City

Bank Grp., Inc., 637 F.3d 1344, 1355 (Fed. Cir. 2011)

(considering “corporate studies tracking awareness of

the CITIBANK mark”). Dewberry Group’s only response to this evidence is a naked assertion that “a

factfinder may reject such studies.” Reply Br. at 7.

Speculation does not create a genuine dispute of fact,

however. Without evidence to the contrary, the record

supports the district court’s finding that the mark is

distinctive and that this factor favors Dewberry Engineers.

ii.

Turning to the similarity of the marks, the district

court found that “the parties’ marks share the same

dominant and distinctive term: ‘Dewberry’” and

found “[t]he addition of the generic terms (e.g. ‘group,’

‘Studio,’ ‘Office,’ etc.)” to Dewberry Group’s new

marks irrelevant. Dewberry I, 2021 WL 5217016, at

*7. Dewberry Group offers a different analysis. In its

view, “the marks in fact have different connotations”

because Dewberry Engineers’ “Dewberry” mark and

design refers to a fruit while its own mark refers to its

owner, John Dewberry. Opening Br. at 31. We disagree.

“[I]n evaluating the similarity of two marks, . . .

the marks need only be sufficiently similar in appearance, with greater weight given to the dominant or salient portions of the marks.” Lone Star Steakhouse,

43 F.3d at 936. The dominant portion of a trademark—that is, “whatever is most noticeable in actual

conditions”—receives “more weight when assessing

similarity because consumers are more likely to confuse marks with dominant similar features than

marks with less noticeable similar features.” Grayson

O, 856 F.3d at 317. But courts “need not engage in a

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technical dissection” of the marks, because consumers

“typically do not engage in” such “nuanced, piecemeal

comparison[s].” Id.

The application of those principles to this case is

straightforward. The parties’ marks feature the word

“Dewberry” in conjunction with other, more generic

prefixes and suffixes (e.g., Dewberry “Engineers” versus Dewberry “Group” and “Studio” Dewberry). The

district court was correct to isolate “Dewberry” as the

dominant word. When Dewberry Group sought registration of its rebranded marks, like “Dewberry Living”

and “Studio Dewberry,” the USPTO required it to disclaim the right to the descriptive terms “Studio” and

“Living,” leaving “Dewberry” as the only distinctive element in both parties’ marks. See Pizzeria Uno, 747

F.2d at 1529–30 (observing that where a mark consists of more than one word, the word which is not disclaimed is the dominant term); see also In re Dixie

Rests. Inc., 105 F.3d 1405, 1407 (Fed. Cir. 1997) (finding “delta” the dominant part of the mark “THE

DELTA CAFÉ because CAFÉ was disclaimed”). The

dominant term in the parties’ marks is thus identical.

“This identity of the dominant term in both marks is

a strong indicator of that similarity in appearance and

sound which would result in confusion.” Pizzeria Uno

Corp., 747 F.2d at 1534. Therefore, the record does

not support a genuine dispute that the marks are similar.

iii.

The district court also found the services that the

marks identify sufficiently similar. Dewberry I, 2021

WL 5217016, at *8. Dewberry Group contests this

conclusion, too, quibbling this time with the district

court’s focus on “the words listed in Dewberry Engineers’ trademark registrations.” Opening Br. at 32.

27a

Had the district court looked elsewhere, Dewberry

Group contends, it would have gleaned from the record that Dewberry Engineers provides architectural

and engineering services on a wholly different level of

the broad real estate market than Dewberry Group’s

real estate development business.

“With regard to this element, the products [and

services] in question need not be identical or in direct

competition with each other. Because confusion may

arise even where products are merely ‘related,’ the

court is to consider ‘whether the public is likely to attribute the products and services to a single source.’”

Renaissance Greeting Cards, Inc. v. Dollar Tree

Stores, Inc., 227 F. App’x 239, 244 (4th Cir. 2007) (unpublished) (quoting CAE, Inc. v. Clean Air Eng’g, Inc.,

267 F.3d 660, 679 (7th Cir. 2001)).

Dewberry Group is right to frame the question

here as one about how the marks are used in the marketplace for their services. But, on that score, there is

plenty of evidence demonstrating both parties’ use of

their “Dewberry” marks in related ways to generate

real estate development business. Dewberry Group

concedes its stake in the commercial real estate market. Dewberry Engineers, in comparison, competes no

less in the real estate development services industry.

Take, for example, the testimony of Joanna Legarreta,

the director of real estate services for Providence Corporation. She testified that Providence Corporation

does business as “Dewberry Real Estate Services” and

provides services, such as “obtaining financing for

property acquisition and construction” and “negotiating and arranging for the acquisition of property for

development purpose,” on behalf of Dewberry Engineers. J.A. 2829. Consider also John Dewberry’s suggestion to Sid Dewberry, a co-founder of Dewberry

28a

Engineers, that their two companies enter a partnership developing a real estate project in Virginia. This

record evidence points not only to the relatedness of

the parties’ services, but to their relationship as complementary services as well. See Comms. Satellite

Corp. v. Comcet, Inc., 429 F.2d 1245, 1253 (4th Cir.

1970) (“Complementary products, or services, are particularly vulnerable to confusion.”).

iv.

The district court also evaluated the similarity of

the parties’ advertising. For this inquiry, a court may

consider “[(1)] the media used, [(2)] the geographic areas in which advertising occurs, [(3)] the appearance

of the advertisements, . . . [(4)] the content of the advertisements” and (5) the amount of advertising between the plaintiff and defendant. Valador, Inc. v.

HTC Corp., 241 F. Supp. 3d 650, 667 (E.D. Va.), aff’d,

707 F. App’x 138 (4th Cir. 2017). The district court

concluded this factor favored a likelihood of confusion

given that both companies market their services in

Virginia, Florida, and Georgia; and “both parties promote their architectural and interior design services

in Architectural Record magazine.” Dewberry I, 2021

WL 5217016, at *8. Dewberry Group disputes this

factor, arguing that the Architectural Record reference was to an article written about its hotel, not a

solicited advertisement.

Putting the Architectural Record magazine dispute aside, the parties’ advertisements appear in

overlapping geographical areas. Dewberry Engineers

and Dewberry Group display their marks on website

designs, leasing signage, leasing packages, and letterhead. And as the district court noted, each markets

its respective brands in Virginia, Florida, and

29a

Georgia. That evidence also favors a likelihood of confusion.

Dewberry Group retorts that a genuine dispute

exists because Dewberry Engineers uses social media

to advertise its real estate services, while Dewberry

Group does not. That Dewberry Engineers also markets on social media is not enough to create a genuine

dispute. A disparity in the amount of advertising done

by one party as compared to the other certainly may

indicate dissimilarity in advertising. See CareFirst,

434 F.3d at 273 (noting that advertising was dissimilar where one party “spends less than $2,000 per year

on advertising” and the other “spends millions of dollars every year”). But the fact that Dewberry Engineers advertises on social media does not indicate that

it spends significantly more money on its advertising

efforts than Dewberry Group. And considering the

parties’ disparate use of social media in comparison

with the record evidence that each party markets in

similar ways and in overlapping markets, at most this

factor neither favors nor disfavors Dewberry Engineers’ claim of confusion.

The district court next found an intent to confuse

or infringe. Intent may be inferred from the junior

user’s knowledge of the senior user’s mark. Variety

Stores, Inc. v. Wal-Mart Stores, Inc., 888 F.3d 651, 665

(4th Cir. 2018) (citation omitted). Following that reasoning the district court found that Dewberry Group

not only knew of Dewberry Engineers’ mark, but entered the CSA and then breached it in favor of its “rebranding” efforts, which re-purposed Dewberry Engineers’ “Dewberry” mark. Dewberry I, 2021 WL

5217016, at *8. In view of these details, the court held

30a

this factor also “favors a finding of a likelihood of confusion.” Id.

Dewberry Group advances two unpersuasive arguments why it believes the district court erred. It

first contends that the district court did not construe

the CSA drawing inferences in its favor. By Dewberry

Group’s reading, the CSA allows it to use other “Dewberry” marks because paragraph B.3 merely permits

Dewberry Group to use the “Dewberry Capital” mark

in connection with its real estate development business—it does not proscribe the use of other “Dewberry” marks. But we read the CSA as more restrictive than that. Elsewhere in the CSA, it ensures the

priority of Dewberry Engineers’ “Dewberry” trademark by eliminating Dewberry Group’s ability to

claim the right to use “Dewberry” beyond the permission expressed therein. And the CSA restricts Dewberry Group’s use of “Dewberry” to the “Dewberry

Capital” mark to real estate development services outside of Virginia, D.C., and Maryland.2 When conducting business inside one of those three locations, Dewberry Group must use the “DCC” mark. None of that

language strikes us as offering Dewberry Group free

rein to use “Dewberry” as it pleases. To conclude otherwise would undermine the very purpose behind the

CSA to settle Dewberry Engineers’ prior claim that

Dewberry group infringed its federal “Dewberry”

trademark. See Pocahontas Min. LLC v. CNX Gas

This point also undermines Dewberry Group’s claim that the

district court gave no consideration to “Dewberry Engineers’ explicit consent” in the CSA to Dewberry Group’s use of the “Dewberry Capital” mark. Opening Br. at 27. Dewberry Engineers’

“consent” was limited in scope. Whatever influence this isolated

provision of the CSA has on this litigation, it cannot overcome

the great weight of evidence favoring likelihood of confusion.

31a

Co., LLC, 666 S.E.2d 527, 531 (Va. 2008) (“A court’s

primary focus in considering disputed contractual language is to determine the parties’ intention, which

should be ascertained, whenever possible, from the

language the parties employed in their agreement.”).

Second, Dewberry Group argues that its decision

to engage in a trademark search prior to its name

change is evidence of a genuine dispute about its intent. That evidence might lead to a reasonable inference of good faith had the parties not previously litigated these same issues and signed a CSA outlining

Dewberry Engineers’ right to its “Dewberry” trademark. On this record, however, Dewberry Group’s

breach of the CSA is compelling evidence of its intent

to confuse and a strong indication that there is a likelihood of confusion. See Pizzeria Uno Corp., 747 F.2d

at 1535 (“If there is intent to confuse the buying public, this is strong evidence establishing likelihood of

confusion, since one intending to profit from another’s

reputation generally attempts to make his signs, advertisements, etc., to resemble the other’s so as deliberately to induce confusion.”).

vi.

Finally, the district court was persuaded by the

evidence of actual confusion in this case. The district

court credited Dewberry Engineers’ evidence of actual

confusion: an expert survey finding that at least

twenty percent of respondents confused “Dewberry

Group” for “Dewberry Engineers” and specific instances where representatives from Dewberry Engineers’ client, the University of Virginia, confused

Dewberry Group for Dewberry Engineers. Dewberry

I, 2021 WL 5217016, at *9. Because Dewberry Group

rebutted that evidence only with immaterial distinctions rather than evidence of no confusion, the district

32a

court sided with Dewberry Engineers on this factor.

We agree with the district court.

Although “[i]t is well established that no actual

confusion is required to prove a case of trademark infringement,” its presence “can be persuasive evidence

relating to a likelihood of confusion.” Louis Vuitton

Malletier S.A. v. Haute Diggity Dog, LLC, 507 F.3d

252, 263 (4th Cir. 2007). Conversely, “the absence of

any evidence of actual confusion over a substantial period of time . . . creates a strong inference that there

is no likelihood of confusion.” CareFirst, 434 F.3d at

269. Actual confusion can be shown through survey

evidence. Tools USA & Equip. Co. v. Champ Frame

Straightening Equip., Inc., 87 F.3d 654, 661 (4th Cir.

1996).

On appeal, Dewberry Group reiterates its arguments below: each instance of confusion occurred

prior to its rebrand and Dewberry Engineers never

raised an issue of actual confusion before instituting

this action, as required by the CSA. We reject both

claims as the district court did. First, as the court

noted, whether the actual confusion occurred before or

after the rebrand does not meaningfully impact its relevance to this inquiry. If anything, the fact that Dewberry Engineers’ clients confused the two before Dewberry Group rebranded would suggest that introducing more names using the “Dewberry” mark would

lead to more confusion. Second, while in theory the

fact that Dewberry Engineers never raised the issue

of actual confusion with Dewberry Group might suggest an inference that none existed, it does not erase

the actual instances of confusion in the record. Finally, even putting those points aside for the sake of

considering facts in a light favorable to Dewberry

33a

Group,3 Dewberry Group still does not rebut Dewberry Engineers’ survey evidence showing at least a

twenty percent actual confusion rate, which alone

serves as “clear evidence of actual confusion for purposes of summary judgment.” RXD Media, LLC, 986

F.3d at 373 (a “confusion rate of 17 percent” is “clear

evidence”). Thus, there is no genuine dispute on this

factor.

After considering these factors, the district court

held that there was a likelihood of confusion between

the parties’ marks, even while acknowledging that

they deal with sophisticated consumers. Dewberry I,

2021 WL 5217016, at *10. We agree. The parties

share an identical, arbitrary dominant word and disclaim different suffixes (and prefixes in some cases) in

the marks at issue. The record shows they also employ those marks in related, overlapping, and complementary services. Those details go some distance toward creating a likelihood of confusion as to the origin

of either party’s “Dewberry” mark. See Pizzeria Uno

Corp., 747 F.2d at 1530 (observing that where the

dominant word is suggestive and is identical except

for a different prefix in the challenged mark, there is

sufficient similarity to create a likelihood of confusion

if the products involved belong to the same general

service); see also Am. Throwing Co. v. Famous Bathrobe Co., 250 F.2d 377, 381 (CCPA 1957) (suggesting

the same reasoning applies to arbitrary marks).

That said, there are more instances in the record. See, e.g.,

J.A. 2725–29 (A businesswoman demanded compensation from

Dewberry Engineers for injuries sustained at Dewberry Group’s

property); J.A. 2723–24 (A rental business contacted Dewberry

Engineers about Dewberry Group’s failure to pay a bill).

34a

There is more yet. In this case, “public confusion

will adversely affect [Dewberry Engineers’] ability to

control [its] reputation among its laborers, lenders, investors, or other group[s] with whom [Dewberry Engineers] interacts.” Perini Corp., 915 F.2d at 128. In

fact, the evidence suggests it already has. That much

is clear from the brand confusion survey Dewberry

Group did not contest below, or the uncontroverted instances of actual confusion among the public and

Dewberry Engineers’ own client. And we may infer

intent to create all this confusion from Dewberry

Group’s brazen attempt to revamp its brand using

“Dewberry” variations in geographic areas prohibited

by the CSA. Even drawing reasonable inferences in

Dewberry Group’s favor, it offers too few record facts

among its many arguments to undermine the evidence of confusion gathered by the district court. In

other words, “no jury reasonably could have ruled” in

Dewberry Group’s favor. RXD Media, LLC, 986 F.3d

at 375.

Because Dewberry Group does not offer persuasive arguments or record evidence to surmount the

district court’s analysis, we affirm the district court’s

finding of trademark infringement.

III.

Failing on the merits, Dewberry Group falls back

on its objections to the remedies Dewberry Engineers

received as compensation for Dewberry Group’s infringement. The district court permanently enjoined

Dewberry Group from using the “Dewberry” mark except in the manner permitted by the CSA. In addition,

the district court ordered Dewberry Group to disgorge

the $43 million of its profits that stemmed from

35a

Dewberry Group’s infringing activity. Then, the court

awarded Dewberry Engineers reasonable attorneys’

fees and costs as authorized by the Lanham Act. We

review those decisions for an “abuse of discretion, accepting the court’s factual findings absent clear error,

while examining issues of law de novo.” Dixon v. Edwards, 290 F.3d 699, 710 (4th Cir. 2002).

Our review of the remedies the district court

granted starts with its injunction order. The Lanham

Act vests courts with the “power to grant injunctions,

according to the principles of equity and upon such

terms as the court may deem reasonable, to prevent”

trademark infringement. 15 U.S.C. § 1116(a). In fact,

we have held that an injunction is “the preferred remedy” for such infringements. Lone Star Steakhouse,

43 F.3d at 939 (citation omitted).

Because the district court found that Dewberry

Group infringed Dewberry Engineers’ “Dewberry”

mark and breached its contract, it entered a permanent injunction order. It enjoined Dewberry Group

from use of the “Dewberry” “name or mark” or “any

name or mark” incorporating “Dewberry” “on or in

connection with any real estate-related products or

services, including but not limited to leasing of real

estate, real estate investment, real estate management, real estate development, real estate site selection, architectural services, interior design and engineering services” except as already permitted by the

CSA. Dewberry III, 2022 WL 1439105, at *5. This

language, in Dewberry Group’s view, is overly restrictive because it “essentially precludes Mr. Dewberry

from using his surname in his commercial real estate

development businesses.” Opening Br. at 51. We do

not share that view.

36a

It is well-understood that “injunctive relief must

not extend beyond the threatened injury.” Catalog

Mktg. Servs., Ltd. v. Savitch, 873 F.2d 1438 (4th Cir.

1989) (unpublished table opinion). And Dewberry

Group is correct that courts are “reluctan[t]” to prevent individuals from using their own names in business. See e.g., E. & J. Gallo Winery v. Gallo Cattle Co.,

967 F.2d 1280, 1288 (9th Cir. 1992). But the injunction language, read in context, merely enjoins Dewberry Group from violating the terms of the CSA to

which it previously agreed. It does not, as Dewberry

Group suggests, command it in terms beyond the

scope of the CSA. And to the extent Dewberry Group

finds the district court’s order ambiguous, it “can always seek clarification or modification of the decree

from the district court.” United States v. Apex Oil Co.,

579 F.3d 734, 740 (7th Cir. 2009).

We decide next whether the district court erred in

awarding disgorgement profits to Dewberry Engineers. In a successful trademark infringement action,

the Lanham Act entitles a plaintiff “to recover (1) [the]

defendant’s profits, (2) any damages sustained by the

plaintiff, and (3) the costs of the action.” 15 U.S.C.

§ 1117(a). Further:

The court shall assess such profits and damages or cause the same to be assessed under

its direction. In assessing profits the plaintiff

shall be required to prove defendant’s sales

only; defendant must prove all elements of

cost or deduction claimed. In assessing damages the court may enter judgment, according

to the circumstances of the case, for any sum

37a

above the amount found as actual damages.

. . . If the court shall find that the amount of

the recovery based on profits is either inadequate or excessive the court may in its discretion enter judgment for such sum as the court

shall find to be just, according to the circumstances of the case. Such sum in either of the

above circumstances shall constitute compensation and not a penalty.

Id.

We have outlined six equitable factors for district

courts to consider in connection with the disgorgement-of-profits remedy for infringement under 15

U.S.C. § 1117(a). These factors are: “(1) whether the

defendant had the intent to confuse or deceive,

(2) whether sales have been diverted, (3) the adequacy

of other remedies, (4) any unreasonable delay by the

plaintiff in asserting his rights, (5) the public interest

in making the misconduct unprofitable, and

(6) whether it is a case of palming off.” Synergistic

Int’l, 470 F.3d at 175.

There is no disagreement in this case that we confront a record lacking in evidence of diverted sales4 or

palming off.5 Even still, the district court ordered

Without evidence of lost profits by Dewberry Engineers

through diverted sales, Dewberry Group contends the disgorgement award does nothing but “punish [it] for supposedly misinterpreting both the Coexistence Agreement [i.e., the CSA] and

the ability of a John Dewberry company to utilize his surname.”

Reply Br. at 17. Because this contention merely rehashes its

failed merits argument that Dewberry Group did not breach the

CSA, we are satisfied to reject it.

Palming off “involves the issue of whether the defendant

used its infringement of the plaintiff’s mark to sell its products,

38a

disgorgement. With respect to Dewberry Group’s intent to confuse or deceive, the district court observed

that Dewberry Group pursued its infringing activities

despite several “red flags” cautioning against its conduct. Dewberry II, 2022 WL 1439826, at *8. These

red flags ranged from Dewberry Group’s own admissions prior to the CSA that the marks are confusingly

similar, the CSA’s terms, Dewberry Engineers’ ceaseand-desist letters, and the USPTO’s denial of the

“Dewberry Group” registration application. Id. at *2–

4. We share the court’s conclusion that Dewberry

Group’s conduct leaves little doubt of its intent to deceive. And, although Dewberry Engineers did not produce evidence of lost sales resulting from Dewberry

Group’s infringement, that factor still weighs in favor

of disgorgement because “the parties operate in overlapping markets” and “market to the same kinds of

parties.” Id. at *8 (citation omitted).

Also favoring disgorgement is the need to compensate Dewberry Engineers for the damage to its “positive reputation” and the dilution of “its significant investment in its brand.” Id. And because the injunction the district court entered would address only future infringement, we agree with the district court’s

reasoning that profit disgorgement is necessary to

make Dewberry Engineers whole for the damage already done. Id. Finally, given the instances of actual

consumer confusion in the record, the district court

concluded that the public interest in making Dewberry Group’s misconduct unprofitable favors disgorgement. Id. at *9. Taking these factors together,

the district court found profit disgorgement

misrepresenting to the public that the defendant’s products were

really those of the plaintiff.” Synergistic Int’l, 470 F.3d at 176.

39a

appropriate. We share that sentiment and discern no

error so far.

Once it decided to disgorge profits, the district

court needed to determine how much Dewberry Group

profited from its infringing activities. The parties disagreed about which revenues belonged in this calculation in the proceedings below and again on appeal.

The core dispute stems from Dewberry Group’s relationship with its affiliates. According to Dewberry

Group, it does not actually provide infringing services

to third parties for a profit. Instead, it produces infringing branding for its affiliates, who in turn generate profits using that branding on their lease, loan,

and other promotional materials. Due to this arrangement, Dewberry Group presented evidence that it

“generated zero profits because the Dewberry Group,

Inc. tax entity showed losses on its tax returns.” Id.

And while Dewberry Group conceded that it is responsible for the accounting and cash management for

each of its affiliates, it argued “that it is not the ‘economic engine that creates the revenue that flows’” to

them. Id. (cleaned up).

On the other hand, Dewberry Engineers’ expert,

Rodney Bosco, testified that “Dewberry Group’s real

estate business is structured so that it and its employees promoted, managed, and operated all of the properties owned by the [affiliates], and did so using the

Infringing Marks.” Id. The district court observed

that Dewberry Group’s Executive Vice President of Finance “provided testimony consistent with Bosco’s

conclusions.” Id.

Persuaded by Dewberry Engineers’ position, the

district court treated Dewberry Group and its affiliates as a single corporate entity for the purpose of calculating revenues generated by Dewberry Group’s use

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of infringing marks. Id. at *10. In addition to weighing the expert testimony, the district court reasoned

that “even though the [affiliates] do not and cannot

perform the work and services necessary to generate

revenues (but for limited exceptions at the hotel), all

revenues generated through Dewberry Group, Inc.’s

services show up exclusively on the [affiliates’] books.”

Id. at *9. Moreover, given that John Dewberry has

contributed at least $23 million to cover Dewberry

Group’s extensive losses over the past thirty years,

the court determined that the tax information showing only losses does not reflect the “economic reality”

of Dewberry Group’s relationship with its affiliates.

Id. at *10

After Dewberry Engineers established Dewberry

Group’s infringing revenues, the burden shifted to

Dewberry Group to present revenues unrelated to the

infringement and the costs that should be deducted.

See 15 U.S.C. § 1117(a). Dewberry Group met that

burden only as to one of those categories. The district

court reduced Dewberry Engineers’ requested award

of $53,719,657 to reflect Dewberry Group’s evidence

that some leases pre-dated the use of the infringing

marks and that “Dewberry Engineers did not allege

that the use of THE DEWBERRY® [hotel] for hospitality services is an infringement.” Dewberry II, 2022

WL 1439826, at *13. Despite Dewberry Group’s failure to calculate exact figures or provide evidence of

deductions from infringement revenues for losses and

expenses, the court equitably reduced the requested

award by twenty percent, to $42,975,725.60. Id. at

*13–14. We find no error of fact or law suggesting the

district court’s conclusions were an abuse of its discretion.

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Disagreeing with our view, Dewberry Group

raises several problems it considers fatal to the district court’s analysis. Yet none displace our conclusions.

Dewberry Group first questions the propriety of

profit disgorgement considering, as it sees things,

there was no evidence in the record of an intent to deceive. It cites CareFirst, for the proposition that an

intent to deceive requires evidence of an “inten[t] to

capitalize on the good will associated with the senior

user’s mark.” 434 F.3d at 273. In CareFirst, the plaintiff argued that the defendant’s “First Care” mark infringed its own “CareFirst” mark. Id. at 266. The

plaintiff further claimed that the defendant’s infringement amounted to bad faith, evidenced by the defendant’s application for a state registration of its allegedly infringing mark a month after the plaintiff sued

the defendant. Id. Rejecting that position, we held

that “[t]he fact of the state application, in and of itself,

simply does not show an intent to capitalize on the

good will associated with CareFirst’s mark.” Id.

Without more, we declined to “infer from this mere filing for state registration that First Care intended to

capitalize on CareFirst’s good will when this action

would have done nothing to achieve that purpose.” Id.

Our CareFirst decision is too factually dissimilar

to this case to undermine the district court’s finding

that Dewberry Group intended to deceive the public.

Unlike the state trademark application in CareFirst,

the federal trademark applications Dewberry Group

filed are not the only indicia of its bad faith. Before

Dewberry Group decided to rebrand from Dewberry

Capital, its general counsel performed a trademark

search, but John Dewberry did not inform him of the

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CSA. Then, Dewberry Engineers sent Dewberry

Group multiple cease-and-desist letters demanding

Dewberry Group’s compliance with the CSA and raising anecdotal instances of actual confusion between

their marks. Dewberry Group still pressed forward

with its activities. Even the USPTO warned Dewberry Group that its sought-after marks resembled

Dewberry Engineers’ mark. What’s more, there is evidence in the record that John Dewberry attempted to

purchase Dewberry Engineers and suggested the two

companies work together on a business venture.

These facts suggest that Dewberry Group intended to

use the “Dewberry” mark variants to rebrand and generate business for itself. Taken together, they support

the district court’s finding that Dewberry Group willfully infringed by using its rebranded “Dewberry”

marks.

Dewberry Group also contends that the district

court abused its discretion because it ignored evidence

that the fees Dewberry Group earned were not attributable to the infringing marks. That criticism ignores the fact that the district court did consider Dewberry Group’s evidence. The court detailed the opinions of Dewberry Group’s expert witness, Lisa Miller,

that “market factors” rather than brand recognition,

drive a commercial tenant’s decision to lease commercial property. Dewberry II, 2022 WL 1439826, at *11.

It also mentioned that many Dewberry Group revenue

streams came from prior existing leases. Id. at *12.

But Dewberry Engineers’ expert, Bosco, also opined

that all the pre-existing leases used the infringing

“Dewberry” marks, which could have contributed to

their renewal or maintenance of the pre-infringement

revenues. He further criticized Miller for failing to

provide any basis for her conclusion that the infringing marks could not have contributed to the

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maintenance of pre-infringement revenue streams.

Weighing Miller’s testimony against Bosco’s competing statements, the district court found Bosco’s evidence more convincing.

There is more to Dewberry Group’s concerns

about Dewberry Engineers’ disgorgement evidence,

though. Dewberry Group posits that Bosco’s testimony could not prove a connection between its infringing conduct and the revenues of its affiliates that used

the infringing materials. A “plaintiff of course is not

entitled to profits demonstrably not attributable to

the unlawful use of his mark.” Mishawaka Rubber &

Woolen Mfg. Co. v. S.S. Kresge Co., 316 U.S. 203, 206

(1942). But Dewberry Group did not carry its burden

to demonstrate that its profits were not so attributable, which is a question of fact to be determined by the

district court and reviewed by this Court for clear error. See Morris v. Wachovia Secs., Inc., 448 F.3d 268,

277 (4th Cir. 2006). Given Bosco’s opinion that Miller

did nothing to clearly demonstrate that there was no

connection between the infringing materials and its

revenues, the district court’s factual finding that there

was such a connection is not clearly erroneous.

Advancing a related critique, Dewberry Group asserts the district court failed to appreciate the corporate distinctions between Dewberry Group and its affiliates by piercing their corporate veils. But we view

the district court’s decision differently. Rather than

pierce the corporate veil, the court considered the revenues of entities under common ownership with Dewberry Group in calculating Dewberry Group’s true financial gain from its infringing activities that necessarily involved those affiliates. Dewberry Group argued below that its tax structure is such that it does

not generate revenues from the real estate

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development efforts of its affiliates. Instead, it provides its affiliates with the infringing promotion materials, the affiliates engage in business using those

materials, and then the affiliates pay Dewberry Group

a fee for this internal service.

The district court relied on the Fifth Circuit’s

holding in American Rice, Inc. v. Producers Rice Mill,

Inc. that the tax treatment of a corporate entity’s infringing behavior is not a barrier to profit disgorgement. 518 F.3d 321, 340 (5th Cir. 2008). There, the

defendant argued that the district court erred in considering profits that the defendant did not retain due

to the nature of its business. Id. at 338. The plaintiff

argued that the defendant’s business structure was irrelevant to its disgorgement obligations as infringers,

and the court agreed. Id. at 339. The Fifth Circuit

found that the defendant clearly earned a profit on its

sales, and that it passed those profits on to its patrons.

Id. “The ‘flow-through’ of the profits to the farmers,”

it reasoned, “is certainly relevant to how [the defendant] is treated for tax purposes; however, [the defendant] cites no authority for the proposition that tax

treatment is relevant to the Lanham Act remedies.”

Id. The court therefore held that “profits earned by

[the defendant] are [the defendant’s] profits for purposes of the Lanham Act, regardless of how such profits are passed on or how they are taxed.” Id. at 340.

Dewberry Group protests the district court’s reliance on American Rice because the defendant in that

case earned a profit directly from the unlawful practices, and simply passed the profit off to another entity. In contrast, Dewberry Group never held any direct profits from its affiliates’ uses of the infringing

materials. While we recognize that distinction, we

find American Rice more illuminating than

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distinguishable. Dewberry Group admits that it operates as a corporate shared-services entity under common, exclusive ownership with its affiliates. It provides financial accounting, human resources, legal

services, and—of course—the infringing marks to

those affiliates and their shared owner, John Dewberry. The affiliates then lease commercial property

to commercial tenants for a profit using those marks.

So, while Dewberry Group did not receive the revenues from its infringing behavior directly, it still benefited from its infringing relationship with its affiliates—just as the defendant in American Rice still benefited from its relationship with the farmers who received its passed-off infringement profits.

A district court’s grant of profit disgorgement is

“subject to the principles of equity,” 15 U.S.C.

§ 1117(a), and is ultimately a matter of the court’s discretion, Synergistic Int’l, 470 F.3d at 176. The district

court here “weigh[ed] the equities of the dispute and

exercise[d] its discretion” to hold Dewberry Group to

account for the revenues generated in part from infringing materials used by its affiliates under common

ownership. Id. Admonishing courts for using their

discretion in this fashion risks handing potential

trademark infringers the blueprint for using corporate formalities to insulate their infringement from financial consequences. That, of course, runs counter

to Congress’s fundamental desire to give trademark

registrants under the Lanham Act “the greatest protection that can be given them.” Park ‘N Fly, Inc., 469

U.S. at 193; see also Am. Rice, 518 F.3d at 340 (noting

that “[t]he purpose of section 1117 is to take all the

economic incentive out of trademark infringement”).

In its remaining challenge to the disgorgement

award, Dewberry Group claims that the district

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court’s calculations were speculative and did not account for costs. To calculate the disgorgement award,

the district court started with a “conservative” estimate of the revenues Bosco calculated for the infringement period, then it subtracted twenty percent from

that number to account for pre-existing leases and

revenues that theoretically might not have had any

relation to the infringing activities. Dewberry II, 2022

WL 1439826, at *11–13. Any arbitrariness in that figure can be traced back to Dewberry Group’s litigation

strategy to deny any connection between its affiliates’

revenues and its infringing marks. Dewberry Group

offered no calculations for costs, nor did it provide calculations reflecting the distinction between infringing

and non-infringing revenues.

It was Dewberry

Group’s burden to provide this evidence, and we will

not now fault the district court for the approximations

it was forced to make.

In sum, we hold that the district court did not

abuse its discretion in finding profit disgorgement appropriate in this case or in its disgorgement calculations.

Finally, we evaluate the district court’s decision to

award attorneys’ fees to Dewberry Engineers. In “exceptional cases” of federal trademark infringement,

the prevailing party may be entitled to reasonable attorneys’ fees. 15 U.S.C. § 1117(a). The district court

considered this an exceptional case because it found

“beyond a preponderance of the evidence that Dewberry Group engaged in bad faith, intentional misconduct.” Dewberry II, 2022 WL 1439826, at *14. Dewberry Group argues that the district court misapplied

the law because it did not consider whether “there is

an unusual discrepancy in the merits of the positions

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taken by the parties, based on the non-prevailing

party’s position as either frivolous or objectively unreasonable” or whether “the non-prevailing party has

litigated the case in an unreasonable manner.” Opening Br. at 56 (citing Verisign, Inc. v. XYZ.COM LLC,

891 F.3d 483–84 (4th Cir. 2018)). But Dewberry

Group’s argument misinterprets the upshot of Verisign.

In Verisign, the Court held that “a prevailing

party need only prove an exceptional case by a preponderance of the evidence” and clarified that “a prevailing party need not establish that the losing party

acted in bad faith in order to prove an exceptional

case.” 891 F.3d at 482. It emphasized a prevailing

party can prove an “exceptional case” by demonstrating that “there is an unusual discrepancy in the merits of the positions taken by the parties, based on the

non-prevailing party’s position as either frivolous or

objectively unreasonable,” that “the non-prevailing

party has litigated the case in an unreasonable manner,” or that “there is otherwise the need in particular

circumstances to advance considerations of compensation and deterrence.” Id. at 483–84.

That language is disjunctive, not conjunctive. So,

while the test includes the factors Dewberry Group

points to, it does not require a prevailing party to

demonstrate the presence of all three circumstances.

The Verisign test instead draws from the Supreme

Court’s “nonexclusive list of factors” for use in determining whether to award attorneys’ fees under a similar provision of the Copyright Act. See Georgia-Pacific Consumer Prods. LP v. von Drehle Corp., 781

F.3d 710, 719–21 (4th Cir. 2015) (citing Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S.

545, 554 & n.6 (2014)). And, as the third factor of the

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Verisign test suggests, district courts are not constrained to follow a “precise rule or formula for making these determinations but instead equitable discretion should be exercised.” See Octane Fitness, 572

U.S. at 554 (cleaned up) (rejecting Federal Circuit’s

attorneys’ fees rule as “overly rigid”).

Given the district court’s findings that Dewberry

Group “pervasively breached the CSA over Dewberry

Engineers’ objection, in contravention of its General

Counsel’s false assurances, and in the face of multiple

red flags, which were cited by the Court on summary

judgment,” it found the award of attorneys’ fees appropriate. Dewberry II, 2022 WL 1439826, at *14. It

is clear to us that the district court awarded fees in its

equitable discretion under the “particular circumstances to advance considerations of compensation

and deterrence.” Verisign, at 484. We find no error in

its judgment.

IV.

After conducting a de novo review of the district

court’s summary judgment determination and finding

no abuses of discretion in its awarded remedies, we

affirm.

AFFIRMED

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QUATTLEBAUM, Circuit Judge, concurring in part1

and dissenting in part:

I disagree with the majority on two issues related

to Dewberry Engineers’ trademark infringement

claim. First, it should be for the jury, not a judge, to

decide whether the trademark is likely to create confusion. That element of Dewberry Engineers’ claim is

inherently fact-based and, under the record here, genuine disputes of material fact remain. And as a result,

I would vacate the district court’s order awarding

Dewberry Engineers summary judgment along with

the order awarding damages.

Second, even were summary judgment appropriate, the district court improperly awarded disgorgement of profits damages. The Lanham Act permits,

under certain circumstances, a party that proves

trademark infringement to recover the infringer’s

profits as damages. But in calculating those profits

here, the district court added the profits of companies

who—although affiliated with the Dewberry Group—

are separate entities and not named defendants. That

was improper. So even were Dewberry Engineers entitled to summary judgment, I would vacate the damages award and send it back for the district court to

redo it.2

I join Part II–A of the majority opinion affirming the district

court’s order of summary judgment on Dewberry Engineers’

breach of contract claim and Part II–B–1 of the majority opinion

affirming the district court’s rejection of the Dewberry Group’s

priority of use defense to Dewberry Engineers’ trademark infringement claim.

Since I would send the issue of likelihood of confusion to the

jury, I would vacate the district court’s damages award in its entirety. But were summary judgment on the trademark infringement claim appropriate, I would join the majority opinion in

50a

Liability for a Lanham Act violation requires,

among other things, a finding of likelihood of confusion between the owner of a protected mark and the

alleged infringer’s mark. CareFirst of Md., Inc. v.

First Care, P.C., 434 F.3d 263, 267 (4th Cir. 2006). We

have established the following nine, non-exhaustive

factors to consider in evaluating likelihood of confusion:

(1) the strength or distinctiveness of the plaintiff’s mark as actually used in the marketplace; (2) the similarity of the two marks to

consumers; (3) the similarity of the goods or

services that the marks identify; (4) the similarity of the facilities used by the markholders; (5) the similarity of advertising used by

the markholders; (6) the defendant’s intent;

(7) actual confusion; (8) the quality of the defendant’s product; and (9) the sophistication

of the consuming public.

Rosetta Stone Ltd. v. Google, Inc., 676 F.3d 144, 153

(4th Cir. 2012) (quoting George & Co., LLC v. Imagination Ent. Ltd., 575 F.3d 383, 393 (4th Cir. 2009)).

These non-exhaustive factors cannot be applied

formulaically. George & Co., LLC, 575 F.3d at 393.

And the factors “are [not all] of equal importance.” Id.

Given the test’s flexibility, it is not surprising that

likelihood of confusion is “frequently a fairly disputed

Part III–A affirming the district court’s order for injunction damages, Part III–B–1 affirming the district court’s decision that

Dewberry Engineers is entitled to disgorgement of profits damages and Part III–C affirming the district court’s award of attorney’s fees. Like the majority, I find no abuse of discretion as to

those issues.

51a

issue of fact on which reasonable minds may differ.”

Variety Stores, Inc. v. Wal-Mart Stores, Inc., 888 F.3d

651, 660 (4th Cir. 2018) (quoting Anheuser-Busch, Inc.

v. L & L Wings, Inc., 962 F.2d 316, 318 (4th Cir.

1992)). In fact

This pivotal trademark issue is particularly

amenable to resolution by a jury for two reasons. First, the jury, which represents a

cross-section of consumers, is well-suited to

evaluating whether an ordinary consumer

would likely be confused. Second, the likelihood of consumer confusion is an inherently

factual issue that depends on the unique facts

and circumstances of each case. Likelihood of

confusion is frequently a fairly disputed issue

of fact on which reasonable minds may differ

and has long been recognized to be a matter of

varying human reactions to situations incapable of exact appraisement.

Anheuser-Busch, 962 F.2d at 318 (cleaned up).

Contrary to the conclusions of the district court

and the majority, a jury—and not the court—should

decide likelihood of confusion here. I agree that the

similarity of the marks and the intent to infringe factors suggest a likelihood of confusion. And while the

evidence of actual confusion is scant, what little exists

favors finding a likelihood of confusion.3 But in granting summary judgment, the district court concluded

that the strength of the mark, the services the mark

identifies, the similarity of advertising and the sophistication of Dewberry Engineers’ customers all support

I also agree with the district court that the similarity of facilities and the quality of the Dewberry Group’s products are not

applicable here.

52a

finding a likelihood of confusion. I disagree. As shown

below, when the evidence is construed in the light

most favorable to the Dewberry Group, as it must be

at the summary judgment stage, there are genuine

disputes of material fact on these issues as well as on

the overall consideration of the likelihood of confusion

factors. The jury—not the court—should decide

whether there is a likelihood of confusion between the

parties’ marks.

First, the strength of Dewberry Engineers’ mark.

This factor is “paramount in determining the likelihood of confusion since a consumer is unlikely to associate a weak or undistinctive mark with a unique

source and consequently will not confuse the allegedly

infringing mark with the senior mark.” Variety

Stores, Inc., 888 F.3d at 661 (cleaned up). The key issue in the analysis of this factor is whether Dewberry

Engineers’ “Dewberry” mark is based on a surname or

not. Surnames are descriptive marks4, which “are not

inherently distinctive” and “are accorded protection

only if they have acquired a ‘secondary meaning.’”

Grayson O Co. v. Agadir Int’l LLC, 856 F.3d 307, 315

(4th Cir. 2017) (quoting Sara Lee Corp. v. Kayser-Roth

Corp., 81 F.3d 455, 464 (4th Cir. 1996)).

The district court held that this factor favored a

likelihood of confusion because, “[t]aken as a whole,

the mark and the ‘berry’ logo do not suggest a surname.” Dewberry Eng’rs, Inc. v. Dewberry Grp., Inc.

See Callman on Unfair Competition, Trademarks and Monopolies § 26:37 (4th ed. 2017) (“The Lanham Act’s ultimate test

is whether the primary significance of the mark is that of a surname to the purchasing public. The classification is a question of

fact.”).

53a

(Dewberry I), No. 20-cv-00610, 2021 WL 5217016

(E.D. Va. Aug. 11, 2021). It relied on the fact that the

United States Patent and Trademark Office did not

require proof of a secondary meaning which it requires for a descriptive mark and that “‘Dewberry’

neither suggests nor describes” Dewberry Engineers’

services. Id. I agree there is some evidence in the

record supporting the conclusion that “Dewberry”

does not suggest a surname. But there is certainly

evidence in the record that it does.

For starters, the founder of Dewberry Engineers

is Sidney Dewberry. Since it began doing business in

the 1950’s, Dewberry has been in the name. It began

as Greenhorne, O’Mara, Dewberry & Nealon. In 1968,

it changed its name to Dewberry, Nealon & Davis. In

1981, the firm changed its name again, this time to

Dewberry & Davis. Then in 2011, it changed its name

to Dewberry Consultants. And finally, in 2017, the

firm became known as Dewberry Engineers. So, for

roughly 60 years, the firm has contained the name

Dewberry. And for almost all of those 60 years, the

surname Dewberry was combined with other surnames as named partners of the engineering firm.

True, “Dewberry” could refer to a fruit and not a

name. But Dewberry Engineers’ comparison of “Dewberry” to “Apple” is, to say the least, a stretch. Steve

Jobs’ last name was not Apple. Sidney Dewberry’s

last name is Dewberry. When this evidence is construed in the light most favorable to the Dewberry

Group, a reasonable factfinder could infer that the

most significant aspect of Dewberry Engineers’ marks

results from the surname Dewberry. And that would

mean the marks are descriptive and thus entitled to

less protection. Said differently, properly applying

the summary judgment standard to the evidence here

54a

requires a conclusion that the strength of the mark

factor weighs against, not for, likelihood of confusion.

Second, consider the services the marks identify.

This factor is measured by each party’s “actual performance in the marketplace.” CareFirst of Md., 434

F.3d at 272. The district court found this factor

weighed in favor of likelihood of confusion. In reaching this conclusion, it relied on the fact that Dewberry

Engineers registered its mark under the real estate

development and development related services category and that the Dewberry Group operates in that

same area. Dewberry I, 2021 WL 5217016, at *8.

While the evidence the court relied on may support its

conclusion of overlapping services, it did not consider

evidence pointing the other way.

The Dewberry Group introduced evidence that it

develops properties like office buildings, shopping centers and hotels. In doing so, it acquires property, obtains financing for purchases and construction and supervises the construction and other improvements.

Afterward, it leases its properties to third-party tenants and provides management services for those

properties. In contrast, while perhaps under the

larger umbrella of real estate development services,

Dewberry Engineers primarily provides engineering

and architectural services to government and commercial entities.5 Even though they operate in some

True, Dewberry Engineers does some work that more closely

resembles what the Dewberry Group does. Through the Providence Corporation, it operates as “Dewberry Real Estate Services,” which “obtain[s] financing for property acquisition and

construction” and “negotiat[es] and arrang[es] for the acquisition

of property for development.” J.A. 2829. But since its primary

55a

of the same geographic areas, Dewberry Engineers

and the Dewberry Group do not compete for business.

In fact, the Dewberry Group once hired Dewberry Engineers to provide engineering services for one of the

Dewberry Group’s real estate development projects.

The district court did not consider any of this evidence. But when this evidence is construed in the

light most favorable to the Dewberry Group, the similarity of services does not favor likelihood of confusion.

Third, the district court found that the parties’ advertising favored a likelihood of confusion largely because both Dewberry Engineers and the Dewberry

Group operate and advertise in Virginia, Florida and

Georgia and because both parties “promote[d] their

architectural and interior design services in Architectural Record magazine.” Dewberry I, 2021 WL

5217016, at *8. While I agree this evidence generally

weighs in favor of similar advertising, the district

court once again did not consider the record evidence

suggesting the parties’ advertising was dissimilar.

The Dewberry Group introduced evidence that

Dewberry Engineers advertises through social media,

electronic newsletters, conferences, trade shows, print

media and press releases, all geared towards

work is providing professional architectural and engineering services to third parties, the different levels in which the parties

operate in the real estate system presents a question of fact on

whether there would be a likelihood of confusion as to the marks

in relation to the normal consumers of the marks. See Homeowners Grp., Inc. v. Home Mktg. Specialists, Inc., 931 F.2d 1100, 1109

(6th Cir. 1991) (“The companies operate at different levels in the

broad real estate industry and sell to two completely distinct sets

of buyers.”).

56a

government and commercial entities that procure architectural and engineering services. It markets

across the United States. Meanwhile, the Dewberry

Group does not advertise through television, radio or

print services. It does not advertise nationwide and

does not market itself on social media. Instead, the

Dewberry Group advertises through financial leasing

packages to prospective tenants and internal fliers

that are circulated to tenants within its developments. While both parties have websites that display

the respective marks, there is still a genuine dispute

of material fact for the jury to resolve as to the parties

advertising.

This evidence, when construed in the light most

favorable to the Dewberry Group, weighs against likelihood of confusion.

Fourth, the sophistication of the consuming public

can be a persuasive factor in the likelihood of confusion analysis. The district court appears to agree that

Dewberry Engineers offers its services to sophisticated buyers, which cuts against Dewberry Engineers’

motion for summary judgment. Dewberry I, 2021 WL

5217016, at *10–11. But it then reasoned that “it

would not be appropriate to conclude that the sophistication of the buyer is dipositive, especially in cases

where actual tenants—the buyers in question—have

demonstrated confusion.” Id. at *10. I agree that the

sophistication of Dewberry Engineers’ customers is

not dispositive. Even so, applying the summary judgment standard, their sophistication weighs against

likelihood of confusion. See Perini Corp. v. Perini Constr., Inc., 915 F.2d 121, 128 (4th Cir. 1990) (“[W]e hold

that in a market with extremely sophisticated buyers,

the likelihood of consumer confusion cannot be

57a

presumed on the basis of the similarity in trade name

alone, particularly without the benefit of trial.”).

To summarize, as we have said in the past, weighing the likelihood of confusion factors generally involves genuine disputes of material fact. Variety

Stores, Inc., 888 F.3d at 666; Anheuser-Busch, Inc.,

962 F.2d at 318. That is because not all the factors

are required to be considered or given the same importance. George & Co., LLC, 575 F.3d at 393. Thus,

by its very nature, the application of these factors will

involve weighing evidence and crediting certain evidence over others. But doing that is inappropriate at

the summary judgment stage of the case. Variety

Stores, Inc., 888 F.3d at 659.

And aside from weighing the factors, the evidence

pertaining to each factor must be construed in the

light most favorable to the non-moving party. Id. 661–

67. When that is done here, many of the factors the

district court determined weighed in favor of likelihood of confusion actually point the other way. See id.

at 666–67 (finding that although five of the factors favored the plaintiff, four of the factors—including the

paramount “strength of the mark”—showed a genuine

dispute of material fact, requiring the order granting

summary judgment on trademark infringement to be

vacated). Under this record, the issue of likelihood of

confusion should go to the jury. As a result, I would

vacate the order granting summary judgment to Dewberry Engineers on its trademark violation claim,

along with the order of damages relating to that claim

and remand the case for further proceedings.

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II.

But even were summary judgment on the trademark infringement claims proper, the district court’s

use of revenues from separate companies affiliated

with the Dewberry Group—who are not parties to the

case—to assess the profits of the Dewberry Group was

not. Relying on testimony from an expert witness of

Dewberry Engineers, the court held that the Dewberry Group and its affiliated entities “will be treated

as a single corporate entity when calculating the revenues and profits generated by [the Dewberry

Group’s] use of the Infringing Marks.” Dewberry

Eng’rs, Inc. v. Dewberry Grp., Inc. (Dewberry II),

No. 20-cv-00610, 2022 WL 1439826, at *10 (E.D. Va.

Mar. 2, 2022). It cited the Fifth Circuit’s American

Rice, Inc. v. Producers Rice Mill, Inc., 518 F.3d 321

(5th Cir. 2008), decision as support for this holding.

And it reasoned that to do otherwise, would “ignore

the economic reality of how [the Dewberry Group’s]

business operates” and “undermine the equitable purposes of the Lanham Act’s disgorgement remedy by

enabling the entire Dewberry Group enterprise to

evade the financial consequences of its willful, bad

faith infringement.” Dewberry II, 2022 WL 1439826,

at *9–10.

The majority affirms this portion of the district

court’s order. It claims 15 U.S.C. § 1117(a)’s “subject

to the principles of equity” language justifies including revenues from the related companies. And it reasons that “[a]dmonishing courts for using their discretion in this fashion risks handing potential trademark

infringers the blueprint for using corporate formalities to insulate their infringement from financial consequences.” Majority Op. at 42–43.

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But the law does not insulate the Dewberry Group

or any related entities that might have infringed on

Dewberry Engineers’ marks. There is no loophole that

lets these entities infringe with impunity. If the corporations affiliated with the Dewberry Group participated in infringing activity, they would be subject to

the reach of the Lanham Act. All Dewberry Engineers

had to do was sue them. Or it could also try to pierce

the Dewberry Group’s corporate veil to eliminate the

corporate separateness between it and those entities.6

But I know of no law that allows courts, in assessing

the profits of a defendant, to disregard those options

and simply add the revenues from non-parties to a defendant’s revenues for purposes of evaluating the defendant’s profits. After all, § 1117(a) speaks to the infringer’s profits. And Dewberry Engineers alleges

that the Dewberry Group, not third parties, was the

infringer.

Assuming without deciding that Virginia law applies, piercing the corporate veil requires the trial court to consider “the particular factual circumstances surrounding the corporation and

the acts in question.” O’Hazza v. Executive Credit Corp., 431

S.E.2d 318, 321 (Va. 1993). For example, in O’Hazza the court

considered the initial capitalization, whether corporate formalities were disregarded, whether the corporation was started for a

legitimate purpose and whether monetary funds were improperly accessed. Id. at 321–22. Virginia law has not designated a

single fact or set of facts necessary to pierce the corporate veil,

but it is generally appropriate to do so when an individual uses

the corporate entity “to evade a personal obligation, to perpetrate

fraud or a crime, to commit an injustice, or to gain an unfair advantage” or if there is “unity of interest and ownership . . . such

that the separate personalities of the corporation and the individual no longer exist and to adhere to that separateness would

work an injustice.” Dana v. 313 Freemason, 587 S.E.2d 548, 553–

54 (Va. 2003) (cleaned up). However, Virginia courts are “very

reluctant to permit corporate veil piercing.” Id. at 554.

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American Rice does not support Dewberry Engineers’ claim that revenues from companies affiliated

with the Dewberry Group can be considered in its disgorgement claim. There, the defendant, Producers

Rice Mill, was a cooperative that realized profits during the infringing time period. When the plaintiff

sought to disgorge those profits, Producers Rice Mill

claimed its liability should be reduced based on the

amount of those profits that it had passed on to its

member farmers. American Rice, 518 F.3d at 326.

The Fifth Circuit held that profits generated by Producers Rice Mill and later distributed to its members

were nevertheless Producers Rice Mill’s profits. Id. at

339–40. That makes sense. In deciding an infringer’s

net profits, legitimate costs can be deducted. But

amounts distributed to members are not a cost. So

American Rice deals with what costs can be deducted

to determine an infringer’s net profits. It does not say

anything about using the revenues of separate companies to calculate net profits.

Unlike in American Rice, the revenues from the

affiliated companies were never realized by the Dewberry Group. Nor did the district court hold that the

Dewberry Group distributed profits it realized to its

affiliated entities. To the contrary, because of what it

described as “the economic reality of how [the Dewberry Group’s] business operates,” it treated the Dewberry Group and the related companies—which it

acknowledged were separate corporate entities—as a

single entity. Dewberry II, 2022 WL 1439826, at *9.

American Rice offers no support for such a ruling. The

district court’s consideration of those revenues was incorrect as a matter of law.

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III.

Because I find that the district court did not

properly consider the likelihood of confusion factors in

the light most favorable to the Dewberry Group, I

would vacate the order granting summary judgment

as to Dewberry Engineers’ trademark infringement

claim and the order granting the injunctive, disgorgement of profits and attorney’s fees relief. And even

were the order granting summary judgment proper, I

would vacate the award for disgorgement of profits

award based on the improper consideration of revenues from separate, non-party entities affiliated with

the Dewberry Group.

I respectfully dissent.

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APPENDIX B

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF VIRGINIA

Alexandria Division

DEWBERRY ENGINEERS, INC.,

Plaintiff,

Civil Action

No. 1:20-cv-00610

Hon. Liam O’Grady

DEWBERRY GROUP, INC.,

Mar. 2, 2022

Defendant.

ORDER

This matter comes before the Court after a threeday bench trial held on October 12th–14th, 2021, in

the above-captioned action. The trial was limited to

the sole issue of the appropriate quantum of damages

to be awarded to Plaintiff Dewberry Engineers’ Inc.,

see Dkt. 175 at 1, as the Court had previously granted

Plaintiff’s Motion for Summary Judgment, see Dkt.

174.

The parties subsequently submitted Proposed

Findings of Fact and Conclusions of Law, Dkt. 238,

Dkt. 239, and their respective Oppositions, Dkt. 245,

Dkt. 246. Having taken all this under advisement, the

Court holds the following.

I. BACKGROUND

A. Procedural Background

On May 29, 2020, Plaintiff Dewberry Engineers,

Inc. (“Plaintiff ” or “Dewberry Engineers”) sued Defendant Dewberry Group, Inc. (“Defendant” or “Dewberry Group”) for trademark infringement and unfair

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competition under the Lanham Act and Virginia law.

Dkt. 1. It also asserted breach of a 2007 Confidential

Settlement Agreement (“CSA”) that resolved litigation between these same parties in 2006-07 (the “Prior

Litigation”), when Plaintiff sued Defendant for infringing the same marks at issue now. The present

claims relate to Defendant’s rebranding from “Dewberry Capital” to “Dewberry Group,” “Studio Dewberry,” “Dewberry Office,” and “Dewberry Living” (collectively, the “Infringing Marks”).

In its Answer, Dewberry Group asserted counterclaims attacking Dewberry Engineers’ federally registered service marks (the “Dewberry Marks”) on the

same grounds it raised in the Prior Litigation. Dkt. 19

at 3. The Court dismissed the counterclaims as

plainly “barred by the [CSA],” which prohibited “the

exact type of challenges [Defendant] is currently attempting to raise,” finding that Defendant had also

“misstate[d]” governing law and “ignor[ed] an entire

paragraph of the CSA itself.” Id. at 3-4.

The Court granted summary judgment in Dewberry Engineers’ favor on all five counts of its Complaint, and denied Dewberry Group’s cross-motion.

Dkt. 174. On the contract claim, the Court found the

CSA unambiguous. Id. at 4. Dewberry Group

breached ¶ B.6 by using “Dewberry” marks many

times to promote and perform architectural-related

services. Id. at 4–7. It repeatedly breached ¶ B.3 by

performing real estate development-related services

using a “Dewberry” mark instead of “DCC” in Virginia. Id. at 8–10. It also breached ¶ B.2 by rebranding to the Infringing Marks and using them in connection with promoting, offering, and performing real estate development services. Id. at 8–10, 15. Under

¶ B.2, “Dewberry Capital” was the only “Dewberry”

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name that Defendant could use for such services—and

only outside of Virginia, Maryland, or D.C.—thus giving Defendant a limited “safe harbor” from infringement. Id. Paragraph B.10 further narrowed that safe

harbor to require use of the column/capital logo depicted in that paragraph together with “Dewberry

Capital.” Id. at 2, 7–10. Accordingly, Defendant’s repeated uses of “Dewberry” marks without the column/capital logo breached ¶ B.10. Id.

The Court additionally found Dewberry Group liable for infringing the Dewberry Marks, holding that

“no reasonable jury could, based on the evidence presented, find that no likelihood of confusion exists between the parties.” Id. at 10–19. The Court also found

that the infringement was intentional in view of the

plain language of the CSA, id. at 15–16, 19, and harms

Dewberry Engineers, which had invested substantially in its marks and developed positive associations

for quality and expertise. Id. at 18–19. The confusion

with Defendant “at best dilutes this investment,” and

“[m]ore concerning, Defendant’s negative publicity

damages [Dewberry’s positive] reputational standing.” Id. at 19. Having granted summary judgment

to Dewberry Engineers on liability, the Court limited

the scope of trial to “the appropriate quantum of damages to be awarded.” Dkt. 175.

The Court denied Dewberry Group’s motion for

partial reconsideration. Dkt. 205. The Court also permanently enjoined Dewberry Group, and any others

“in active concert or participation with” Defendant,

from continuing the unlawful infringement. Dkt. 229

at 9. The Court stayed the injunction until final judgment. Dkt. 208.

The Court then heard a three-day bench trial on

the sole issue of damages. Dkt. 175. The trial was

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held October 12th–14th, 2021. At trial, Dewberry Engineers called damages expert Rodney Bosco, and relied on its admitted documentary evidence and deposition designations. Dewberry Group called Elizabeth

Armstrong (its Director of Brand Development), David Groce (its former General Counsel), John Freeman

(its Executive Vice President of Finance), John Dewberry (its Founder and CEO), and Lisa Miller (its

damages expert). At the close of evidence, Defendant

moved for Judgment on Partial Findings under Fed.

R. Civ. P. 52(c), which Plaintiff opposed, and the Court

denied. Day 3 A.M. Tr. 123:3–9.

B. Factual Background

The Court finds the following facts relevant to the

profits disgorgement remedy owed to Plaintiff.

1. Dewberry Group’s infringement

was intentional and ignored numerous red flags alerting it to the illegality of its conduct.

While proof of willful, intentional, or bad-faith infringement is not a prerequisite to profits disgorgement, the infringer’s mental state is, nonetheless, “a

highly important consideration” in awarding profits

under the Lanham Act. Romag Fasteners, Inc. v. Fossil Inc., 140 S. Ct. 1492, 1497 (2020). On summary

judgment, the Court found Defendant’s infringement

to have been intentional. Dkt. 174 at 15-16, 19. The

trial produced further evidence of Defendant’s willfulness and bad faith. It showed that Dewberry Group

encountered but ignored a succession of multiple “red

flag” facts and circumstances alerting it to the illegality of its conduct, and had ample financial motivation

for doing so.

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The first red flag is Defendant’s admissions before

and during the pre-trial litigation that its use of “Dewberry” would cause confusion in the marketplace with

Dewberry Engineers. Those historic admissions are

still relevant because Defendant’s development-related services have remained largely the same since

2004. John Dewberry Dep. Tr. [Dkt. 218-4] at 47:20–

49:6.

In February 2006, Defendant, which then went by

“Dewberry Capital,” filed an application with the U.S.

Patent and Trademark Office (“PTO”) to register that

name as a service mark for various real estate services. PX 73 at TSDR 901–02. The application was

filed by Defendant’s attorney Joseph V. “Jay” Myers,

III of Seyfarth Shaw LLP. Id. at 903.

Two weeks later, Myers sent Dewberry Engineers

a demand letter accusing it of trademark infringement, insisting that the registered Dewberry Marks

were “extremely similar to” Defendant’s unregistered

“Dewberry Capital” mark “because of the common use

of the predominant element ‘Dewberry’ and because

the companies’ services “are legally related . . . and

travel in the same channels of commerce . . . .” PX 76

at 1–2. Thus, according to Defendant, “a likelihood of

confusion or mistake exists between the parties’ respective marks.” Id. at 2.

At trial, John Dewberry tried to distance himself

from this letter, testifying that “I don’t believe” its contents. Day 2 P.M. Tr. 109:6-14. Yet John Dewberry

did not dispute the letter’s contents, he (not Hodgson)

was copied on it, and he agreed that Defendant had

retained Myers. PX 76 at 2; Day 2 P.M. Tr. 107:8108:20.

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Indeed, instead of backing off his position, John

Dewberry offered to purchase Dewberry Engineers

multiple times, which Dewberry Engineers rejected.

PX 85 at 1; PX 89 at 1. John Dewberry admittedly

made those offers. Day 2 P.M. Tr. 78:21–79:6. He

tried to characterize them as a friendly gesture, id.,

but his offers reveal a desire to obtain a connection

with Dewberry Engineers and its marks, consistent

with a motive to infringe.

The second red flag is that, in August 2006, the

PTO rejected Defendant’s “Dewberry Capital” application due to a likelihood of confusion with the Dewberry Marks. PX 73 at TSDR 0884–86. The PTO

found the parties’ marks to be virtually identical,

sharing “the same dominant feature, namely DEWBERRY,” and noted that “the parties’ services are

identical and highly related real estate services.” Id.

at 0885–86. These grounds for refusal are virtually

identical to the PTO’s grounds for refusing Defendant’s subsequent unlawful “Dewberry” applications at

issue in the present case.

The third red flag is the 2007 Confidential Settlement Agreement. The Court’s summary judgment order found that Defendant repeatedly breached the

CSA when it rebranded to the Infringing Marks, and

cited those breaches as evidence of Defendant’s intentional infringement. The Court explained that “Defendant was aware of Plaintiff’s mark, entered into

the CSA but breached the agreement as part of its ‘rebranding’ efforts, and then re-adopted the Plaintiffs

‘Dewberry’ mark.” Dkt. 174 at 15–16, 19. Dewberry

Group’s defense, that the CSA gave it consent to use

“‘Dewberry’ in general,” was “meritless” because the

unambiguous “CSA, in fact, says the opposite.” Id. at

4, 15–16. This red flag is noteworthy given the

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pervasiveness of Defendant’s unlawful uses of “Dewberry” marks discussed in the Summary Judgment

Order, and reinforced by the evidence at trial.

Consistent with John Dewberry’s pattern of

claiming ignorance, when asked at trial whether he

had read the CSA that he signed, his answer was,

“probably not.” Day 2 P.M. Tr. 82:23–84:12. Even if

true, however, Dewberry Group remains bound by the

CSA. When John Dewberry became aware of the

CSA’s restrictions, he said he “was not happy” to learn

that it did not give both parties “equal rights” to use

“Dewberry” for real estate development services because “that’s what [he] wanted it to say.” Day 2 P.M.

Tr. 84:11-85:13. That admission reveals his awareness and dislike of the very CSA provisions that Defendant breached repeatedly, thus providing further

evidence of willful and intentional infringement.

Despite the CSA’s “Dewberry Capital” safe harbor

and prohibition on using other “Dewberry” names,

John Dewberry decided to jettison “Capital” in 2017

because he no longer liked its financial connotations.

In a September 6, 2017 email, John Dewberry ordered

his staff to rebrand to “Dewberry Group” and “Studiodewberry.” PX 303; Day 2 P.M. Tr. 92:20–93:5.7 He

also wanted to register a “Dewberry Group” mark

with the PTO, but first asked his General Counsel,

David Groce, to “do a search” for that name, because

Mr. Dewberry had been through “this thing before”

(i.e., the Prior Litigation). PX 303; Day 2 P.M. Tr.

94:2–15. Yet John Dewberry never informed Groce

about the prior litigation and the resulting CSA.

Two days later, Groce filed a “Dewberry Group”

service mark application with the PTO for real estate

development and related services. PX 302 at TSDR

0961–66; Day 2 A.M. Tr. 22:3–18. Groce emailed John

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Dewberry and others about this. PX 303. When Groce

later learned of the Prior Litigation and CSA after receiving a cease-and-desist letter from Dewberry, he

was “very, very surprised” and “embarrass[ed],” and

apologetically agreed to abandon the application.

PX 329; Day 2 A.M. Tr. 25:2–25:25, 59:14–61:4. The

Court finds that John Dewberry’s failure to inform

Groce about the prior litigation and the CSA is further

evidence of willfulness, as John Dewberry hoped that

neither Groce nor Dewberry Engineers would raise

objections that could hinder his desired rebranding.

The fourth red flag is that, when Groce nevertheless found Dewberry Engineers and the Dewberry

Marks during his research and alerted John Dewberry and nine other colleagues, John Dewberry ignored it. John Dewberry testified that, “once I asked

[David] Groce to do this [search], I kind of left it with

him.” Day 2 P.M. Tr. 98:10–18. When asked whether

Groce performed the search as instructed, John Dewberry stated, “. . . I hope so. I was a little bit in the

dark [on] what David [Groce] was doing, and I think

he was keeping me that way on purpose.” Id., 124:22–

25. That testimony is undercut by Groce’s email

which, despite heavy redaction, reveals that he did inform John Dewberry about finding Dewberry in the

search. PX 301.

The fifth red flag is that, on December 19, 2017, a

PTO examining attorney called Groce to explain her

refusal of the “Dewberry Group” application, including its confusing similarity to the Dewberry Marks.

PX 302 at TSDR 0938–39. The next day, the PTO informed Defendant of the refusal in an Office Action

sent to Groce. Id. The PTO found that “Dewberry

Group” and the Dewberry Marks were confusingly

similar because of the “dominant wording

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DEWBERRY” and similarity of the parties’ services.

Id. And this confusion could not be eliminated by using other descriptors, such as the “descriptive disclaimed wording GROUP,” or by adding “a design element.” Id. at TSDR 0939.

The Court finds that Groce’s testimony throughout the trial was not credible. In particular, regarding

the PTO’s rejection, it strains credulity that Groce

would clearly remember minor details, but have no

recollection of the PTO’s far more significant denial on

confusion grounds with the Dewberry Marks. Similarly, the Court finds that John Dewberry’s testimony

throughout trial was not credible. John Dewberry testified that he “wasn’t being kept abreast” of the PTO

application or rejection, claiming that “I’ve never seen

any of this stuff until you showed it to me today.” Day

2 P.M. Tr. 99:22-100:6, 125:12-19. This professed ignorance is not credible. At best, his ignorance

amounts to willful blindness.

The sixth red flag is that, a week after the PTO

rejected “Dewberry Group,” Plaintiff sent Defendant a

cease-and-desist letter, demanding that it halt its efforts to register “Dewberry Group,” which breached

the CSA and reflected an intent to infringe. PX 321

at 1-3. Groce claimed this letter to be the first time he

learned of the Prior Litigation and the CSA. Day 2

A.M. Tr. 24:2–25:8. John Dewberry once again

pleaded ignorance and tried to blame his General

Counsel: “David [Groce] may have, you know, been

hiding [the letter] from me because he was afraid or

something.” Day 2 P.M. Tr. 98:19–99:3. This denial

is no more credible than his many others, and Groce

could not corroborate it given Defendant’s election to

invoke privilege. Day 2 A.M. Tr at 76:14–77:4. But

even if it were true, it is more willful blindness.

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The seventh red flag is that, in his January 11,

2018 apologetic response to Dewberry Engineer’s

cease-and-desist letter, Groce promised “to abandon

our application” and “not to attempt to register the

term DEWBERRY GROUP for real estate development services” or “to use the term in connection with

any present or future real estate development or related services in Virginia, Maryland, or the District of

Columbia” in violation of the CSA or Dewberry Marks.

PX 329; Id. at 26:9–30:2, 90:20–92:24.

Despite all of these red flags, Defendant forged

ahead with its rebranding. For example, in the same

month as Groce’s apologetic letter, Defendant promoted its architectural services for “Studio Dewberry”

(a violation of the CSA). In February 2018, Defendant

sent “Dewberry Group” marketing materials to prospective tenants, PX 343. In March 2018, Defendant

used “Dewberry Capital” and “Studio Dewberry” in

negotiations to purchase land from the owner of property in Charlottesville, Virginia. PX 348. Day 2 A.M.

Tr. 94:20-97:11. Also in March 2018, Dewberry Group

sent to its third-party brokers a branding guide directing them to use the Infringing Marks in “existing and

future marketing materials.” PX 350; Day 1 P.M. Tr.

91:15–92:12. The same month, Defendant used “Dewberry Group” in leasing materials sent to multiple prospective tenants in Charleston and Atlanta. PX 347;

PX 349; PX 354. A month later, John Dewberry approved the decision to “continue with the Dewberry

Group logo on all new leasing materials.” PX 366;

Day 1 P.M. Tr. 109:19–110:7.

Elizabeth Armstrong confirmed the high business

and economic value Dewberry Group placed on rebranding to the Infringing Marks. Id.; Day 1 P.M. Tr.

112:19–114:19, 132:11–133:19; Armstrong Dep. Tr.

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[Dkt. 218-1] 305:4-306:14. She explained that the Infringing Marks, as a brand, were far superior to the

abandoned “Dewberry Capital” mark and logo, and

“really bring[] all of the properties and hotel together.”

Id., 133:1–19. Indeed, Dewberry Group considered

promotion of its services under the infringing “Studio

Dewberry” mark to be a “top priority” as a “huge differentiator” from competing firms, to be highlighted

“on any item we design.” PX 338 at 05_DG-0247065;

PX 344 at 05_DG-0246956. Defendant’s perceived

value of the rebranding was thus a strong motive to

continue moving forward despite the ever-increasing

red flags.

In April 2018, Dewberry Group applied to register

the full suite of Infringing Marks with the PTO.

PX 359 at TSDR 1315–17; PX 360 at TSDR 1726–31;

PX 361 at TSDR 1897–02; PX 362 at TSDR 2209–11;

Day 2 A.M. Tr. 35:21–38:3, 40:12–41:13. It did so

without any notice to Dewberry Engineers. PX 329;

Day 2 A.M. Tr. 111:2–10. Abandoning the column logo

in breach of CSA ¶ B.10, Defendant added a “D”-in-acircle design element to three of those marks. Id. In

addition to breaching the CSA, given the PTO’s prior

warning that adding a design element to “Dewberry

Group” would not eliminate confusion with the Dewberry Marks, PX 302 at TSDR 0939, Defendant had to

know its latest applications were likewise confusingly

similar. Its General Counsel even conceded that

“Dewberry”—Plaintiff’s registered mark—is the “common denominator” of all the Infringing Marks. Day 2

A.M. Tr. 101:4-22.

Groce did not perform any risk evaluations prior

to Defendant’s filing to register the Infringing Marks.

Groce Dep. Tr. [Dkt. 218-6] at 52:3–21. In fact, after

Dewberry Engineers’ December 2017 cease-and-desist

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letter to Defendant and Groce’s apologetic reply, he

was essentially stripped of responsibility for the “direction and management of the dispute” with Dewberry Engineers and prosecution of the Infringing

Marks, as such matters were turned over to outside

counsel. Day 2 A.M. Tr. 38:5–17. Groce similarly

claims to have been uninvolved with Defendant’s rebranding, testifying that “I was not personally involved” or “personally familiar” with the “rebranding

effort” or what “anybody else was doing” for it. Id.,

35:10–20. Like his other pleas of ignorance, Groce’s

purported lack of awareness here is troubling.

The eighth red flag is that, Dewberry Engineers

sent another cease-and-desist letter in June 2018,

PX 373, but Dewberry Group still refused to abandon

the Infringing Marks. PX 374. In July 2018, Dewberry Engineers sent another letter, reiterating its objections to the Infringing Marks, informing Dewberry

Group of actual confusion between the parties occurring “in both the Charlottesville area and the Northern Virginia area,” and requesting a response within

21 days. PX 376; Day 2 A.M. Tr. 112:19–115:14. Defendant ignored the letter and continued with its rebranding and use of the Infringing Marks. E.g.,

PX 377, PX 379.

The ninth and final red flag is that, less than two

weeks after Dewberry Group’s third cease-and-desist

letter, the PTO rejected Defendant’s “Studio Dewberry” application as confusingly similar to the Dewberry Marks, finding the marks to be “similar in

sound, appearance and commercial impression as a

result of the term ‘DEWBERRY”; that the parties’ services were related; and that the term “Studio” was

merely descriptive and had to be disclaimed. PX 361

at TSDR 1859–63; Day 2 A.M. Tr. 107:11–109:16.

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Such confusion findings echo those in the PTO’s refusals of “Dewberry Group” six months earlier and of

“Dewberry Capital” in 2006. Compare PX 361 at

TSDR 1859–63, with PX 302 at TSDR 0938–42, and

PX 73 at TSDR 0884–86.

Having received no response to its July 13 letter,

Dewberry Engineers submitted Letters of Protest to

the PTO providing evidence as to why the three remaining Infringing Marks should also be refused on

confusion grounds. PX 359 at TSDR 1169; PX 360 at

TSDR 1648; PX 362 at TSDR 2103. In the ensuing

months, the PTO refused those marks on substantially the same confusion grounds as it rejected “Studio Dewberry,” as Groce acknowledged. PX 359 at

TSDR 1132–68; PX 360 at TSDR 1611–47; PX 362 at

TSDR 2066–02; Day 2 A.M. Tr. 111:11–18.

Dewberry Group challenged the refusals, but the

PTO rejected them as “unpersuasive,” along with Defendant’s multiple requests for reconsideration.

PX 359 at TSDR 0980–82, 1033–53; PX 360 at TSDR

1460–62, 1512-32; PX 362 at TSDR 1915–17, 1967–

87. The PTO’s refusals of the Infringing Marks for

confusion with the Dewberry Marks—just like the

2017 and 2006 refusals—were more obvious red flags.

Again professing ignorance, John Dewberry said he

“wasn’t being kept abreast” of the applications for the

Infringing Marks or the PTO’s responses: “I’ve never

seen any of this stuff until you showed it to me today.”

Day 2 P.M. Tr. 99:22–100:6; 125:12–19. This testimony, like his other denials, is not credible. But even

if true, it would be yet another example of willful

blindness.

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2. Despite these numerous red flags,

Dewberry Group forged ahead with

its continued use of the Infringing

Marks.

Despite these additional red flags throughout

2018 and 2019, Dewberry Group pressed forward. In

May 2019, Defendant officially changed its name from

“Dewberry Capital Corporation” to “Dewberry Group,

Inc.” with Georgia’s Secretary of State. PX 472; Day

2 A.M. Tr. 7:23–25. It also distributed numerous leasing packages to prospective tenants and their brokers

and loan request packages to lenders. See, e.g., PXs

379, 385-87, 389-91. These leasing and loan packages

all feature the Infringing Marks and promote Dewberry Group’s portfolio of properties. Dewberry Group

used the Infringing Marks with current tenants, too,

such as in letters to its Oyster Park tenants soliciting

advertisements on its new “large [Dewberry Living]

Monument sign.” PX 403. By January 2019, Dewberry Group had launched its new website plus its

new “Dewberry Group” letterhead and email signature blocks with the Infringing Marks, see, e.g.,

PX 433, PX 438. Also in 2019, Dewberry Group updated signage at multiple properties to feature the Infringing Marks, see, e.g., PX 639, PX 646, PX 645.

And, Dewberry Group continued using “Dewberry

Capital” and the Infringing Marks in Virginia for development in additional ways the Court has previously deemed unlawful.

In sum, this evidence shows that Defendant pervasively engaged in the very types of acts and services

the Court determined to be clear breaches of the CSA

and infringement of the Dewberry Marks. That Defendant did so in the face of the numerous red flags

demonstrates that its infringement was intentional,

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willful, and in bad faith. Further, for the numerous

reasons previously stated, the Court finds that the

testimony of David Groce and John Dewberry

throughout trial was not credible. At best, their

feigned ignorance amounts to willful blindness on behalf of Dewberry Group.

II. LEGAL STANDARD

Plaintiff Dewberry Engineers brings its case for

profits disgorgement under the Lanham Act. The purposes of the Lanham Act include to “regulate commerce within the control of Congress by making actionable the deceptive and misleading use of marks in

such commerce . . . [and] to prevent fraud and deception in such commerce by the use of reproductions,

copies, counterfeits, or colorable imitations of registered marks . . .” 15 U.S.C. § 1127

15 U.S.C. § 1117(a)—Recovery for violation of

rights under the Lanham Act—provides:

. . . The Court shall assess such profits and

damages or cause the same to be assessed under its direction. In assessing profits the

plaintiff shall be required to prove defendant’s sales only; defendant must prove all elements of cost or deduction claimed. In assessing damages the court may enter judgment, according to the circumstances of the

case, for any sum above the amount found as

actual damages, not exceeding three times

such amount. If the court shall find that the

amount of the recovery based on profits is either inadequate or excessive the court may in

its discretion enter judgment for such sum as

the court shall find to be just, according to the

circumstances of the case. Such sum in either

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of the above circumstances shall constitute

compensation and not a penalty. The court in

exceptional cases may award reasonable attorney fees to the prevailing party.

The purpose of this provision allowing plaintiff to recover the infringing defendant’s profits is to take all

the economic incentive out of trademark infringement. See American Rice, Inc. v. Producers Rice Mill,

Inc., 518 F.3d 321, 340 (5th Cir. 2008).

The Fourth Circuit outlines six equitable factors

for a district court to consider in connection with the

disgorgement-of-profits remedy for infringement under 15 U.S.C. § 117(a). These factors are: “(1) whether

the defendant had the intent to confuse or deceive,

(2) whether sales have been diverted, (3) the adequacy

of other remedies, (4) any unreasonable delay by the

plaintiff in asserting his rights, (5) the public interest

in making the misconduct unprofitable, and

(6) whether it is a case of palming off.” Synergistic International, LLC v. Korman, 470 F.3d 162, 175 (4th

Cir. 2006). See also Banjo Buddies, Inc. v. Renosky,

399 F.3d 168, 176 (3d Cir. 2005); Quick Techs., Inc. v.

Sage Group PLC, 313 F.3d 338, 349 (5th Cir. 2002)

(identifying these same six factors). These factors are

not exhaustive, and the Court may consider additional

factors. See Synergistic, 470 F.3d at 176. Further, a

plaintiff need not establish all factors to be awarded

profits. See Variety Stores, Inc. v. Walmart Inc., 852

Fed. Appx. 711, 721 (2021).

III. DISCUSSION

In determining the proper amount of the disgorgement remedy to award to Dewberry Engineers, the

Court considers numerous issues raised at trial and in

the post-trial filings. These issues include: whether

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the Synergistic factors weigh in favor of disgorgement;

whether Dewberry Group and the “Ownership Entities” are to be considered a single corporate entity;

whether Bosco’s revenue calculations are overinclusive; and whether Defendant carried its burden to

prove costs or deductions claimed. The Court addresses each of these in turn.

A. The Synergistic factors favor a disgorgement of profits remedy.

In considering the “Synergistic factors” outlined

by the Fourth Circuit, the Court finds that five of the

six factors are applicable, and that a profit disgorgement remedy is appropriate in this case.

The first Synergistic factor, whether the defendant had the intent to confuse or deceive, “addresses

whether there has been a willful infringement on the

trademark rights of the plaintiff, or whether the defendant has acted in bad faith.” Synergistic Intern.,

470 F.3d at 175. In awarding summary judgment to

Dewberry Engineers, the Court held that the intent

factor in the likelihood-of-confusion analysis weighs in

Dewberry Engineers’ favor. Dkt. 174 at 15–16, 19. As

discussed above, the evidence at trial further demonstrated that Defendant’s infringement was not only

intentional, but also willful and in bad faith. Ignoring

just a few infringement red flags—let alone a long succession of them as Defendant did—has been held to

establish willful and bad faith infringement. See Variety Stores, 852 F. App’x at 723. Indeed, where, as

here, one of the red flags includes “obligations under

[a] Settlement Agreement . . . to refrain from using [a]

mark,” it represents “not merely a case of knowing

and deliberate infringement,” but “a total disregard of

a specific promise” that amounts to “bad faith.” Am.

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Farm Bureau Fed’n v. Ala. Farmers Fed’n, 935 F.

Supp. 1533, 1553 (M.D. Ala. 1996).

The second Synergistic factor, whether sales have

been diverted, evaluates “whether the plaintiff lost

sales as a result of the defendant’s trademark infringement activities, and the extent to which the

plaintiff had entered the market area where the infringement occurred.” 470 F.3d at 175. In its summary judgment order, the Court already established

that “the parties operate in overlapping markets” and

“market to the same kinds of parties,” Dkt. 174 at 14–

15, 19; thus, the second Synergistic factor also favors

disgorgement. Although Dewberry Engineers has not

provided direct evidence of lost sales, this is not required under the Lanham Act. See, e.g., Exclaim

Mktg., LLC v. DirecTV, LLC, 674 F. App’x 250, 257

(4th Cir. 2016) (rejecting infringer’s argument that

disgorgement was improper in the absence of evidence

of actual diverted sales).

The third Synergistic factor, the adequacy of other

remedies, also favors Dewberry Engineers. This factor considers “whether another remedy, such as an injunction, might more appropriately correct any injury

the plaintiff suffered from the defendant’s infringement activities,” in lieu of disgorgement. 470 F.3d at

176. The injunction entered in this case will only address future harm to Dewberry Engineers, not past injuries. See Mazelmints, Inc. v. It’s A Wrap, LLC, No.

1:10-CV-1117, 2011 WL 2960873, at *5 (E.D. Va. July

20, 2011) (“[P]ast harm cannot be cured via an injunction.”). The Court’s summary judgment and injunction

rulings found that the confusion created by the infringement has injured Dewberry Engineers’ positive

reputation and diluted its significant investment in

its brand. Only disgorgement of Dewberry Group’s

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profits can redress Dewberry Engineers’ unquantifiable but real reputational damage. Additionally, Dewberry Group’s use of the Infringing Mark in the face of

myriad red flags discussed above and attempts to justify such infringement through contorted readings of

the CSA indicate that an injunction alone is likely insufficient to deter all future infringement.

The fourth Synergistic factor, any unreasonable

delay by the plaintiff in asserting its rights, “addresses the temporal issue of whether the plaintiff

waited too long, after the infringement activities began, before seeking court relief.” 470 F.3d at 176.

Dewberry Group’s summary judgment motion asserted an unreasonable delay based on the two years

between Dewberry’s filing suit and Defendant’s applications for the Infringing Marks, Dkt. 71 at 32. But

the Court denied Defendant’s motion, and the argument fares no better now.

Dewberry Engineers did not sit on its hands after

Dewberry Group filed applications for the Infringing

Marks. As discussed above, Dewberry Engineers

promptly sent cease-and-desist letters, and when

Dewberry Group ignored them, Dewberry Engineers

filed Letters of Protest opposing the applications

which the PTO acted on. Courts have found that pursuing an opposition in the USPTO can excuse a delay

in filing suit on a Lanham Act claim. See e.g., Variety

Stores, Inc. v. Wal-Mart Stores, Inc., No. 5:14-CV-217,

2016 WL 6906704, at *3 (E.D.N.C. Nov. 22, 2016), vacated and remanded on other grounds, 888 F.3d 651

(4th Cir. 2018) (2.5 year delay in suit not unreasonable delay given plaintiff’s PTO opposition to infringing

applications); Exclaim Mktg., LLC v. DirecTV, LLC,

674 F. App’x 250, 257-58 (4th Cir. 2016) (affirming enhanced profits award despite four-year delay in filing

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suit). See also Gaudreau v. Am. Promotional Events,

Inc., 511 F. Supp. 2d 152, 159 (D.D.C. 2007) (“Numerous courts have recognized that pursuing an opposition in the USPTO excuses delay in filing suit on a

Lanham Act claim.”)

The fifth Synergistic factor, the public interest in

making the misconduct unprofitable, “addresses the

balance that a court should strike between a plaintiff’s

right to be compensated for the defendant’s trademark infringement activities, and the statutory right

of the defendant to not be assessed a penalty.” 470

F.3d at 176. Infringing “behavior . . . interferes with

the consumer’s ability to make informed purchasing

decisions.” Banjo Buddies, Inc. v. Renosky, 399 F.3d

168, 176 (3d Cir. 2005). The Court has already found

that Dewberry Group’s infringement caused actual

consumer confusion, Dkt. 174 at 16-19. Furthermore,

Dewberry Group generated millions while using the

Infringing Marks between 2018 and 2020. The Court

acknowledges that there is a public interest in making

such conduct unprofitable. See American Rice, 518

F.3d at 340 (“[T]he purpose of section 1117 is to take

all the economic incentive out of trademark infringement.”) (internal citation omitted).

The sixth and final Synergistic factor, whether it

is a case of palming off, “involves the issue of whether

the defendant used its infringement of the plaintiff’s

mark to sell its products, misrepresenting to the public that the defendant’s products were really those of

the plaintiff.” 470 F.3d at 176. Both Plaintiff and Defendant agree that this is not a case of palming off,

and the Court agrees. But a plaintiff need not establish all factors to be awarded profits. See Variety

Stores, Inc., 852 Fed. Appx. at 721.

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In sum, the Court finds that five of the six Synergistic factors outlined by the Fourth Circuit favor

Plaintiff Dewberry Engineers in this case. Therefore,

the Court finds that a profit disgorgement remedy is

appropriate here.

B. Dewberry Group and the “Ownership

Entities” are considered a single corporate entity.

The parties disagree on whether the Court should

consider, as Defendant urges, only the revenues and

profits reported on the tax returns of the single corporate entity Dewberry Group, Inc., or as Plaintiff argues, the revenues and profits that were generated

and collected by the Dewberry Group real estate business, through the services and managerial efforts of

Dewberry Group and its employees and ultimately

distributed to affiliated, single-purpose entities owning properties managed and serviced by Dewberry

Group (collectively, the “Ownership Entities”). It is

undisputed that John Dewberry owns outright and/or

controls Dewberry Group and the Ownership Entities.

As a preliminary matter, Dewberry Group states

that the Court already held that the Ownership Entities are “third parties, separated by the corporate

veil.” Dkt. 174 at 6. While the Court did use this

phrase, evidence further developed at trial has proven

it to be inaccurate. This phrase did not control the

Court’s holding in the summary judgment order and

does not govern the Court’s analysis here.

Defendant’s expert witness, Lisa Miller, looked at

corporate formalities and tax reporting to conclude

that all of the revenue shown on the books of the Ownership Entities should be excluded. Day 3 A.M. Tr.

32:13–33:17. She further opined that Defendant

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generated zero profits because the Dewberry Group,

Inc. tax entity showed losses on its tax returns. Id.,

35:5–18; DX 511. Dewberry Group argues that it is

responsible for the accounting and cash management

for each separate Ownership Entity, which includes

logging debits and credits for each separate entity and

maintaining each separate entity’s bank account;

however, Dewberry Group argues that it is not the

“economic engine that creates the revenue that flows

to these Ownership Entities.” Tr. [Doc. 233] at 12:18.

In contrast to Defendant’s reliance on corporate

formalities and tax reporting, Plaintiffs expert witness, Rodney Bosco, looked at the economic reality of

how the Defendant’s business actually operates. In

Bosco’s opinion, when the evidence of Dewberry

Group’s business and financial operations is considered from an economic perspective, it supports consideration of the total revenues and profits of the combined Dewberry Group real estate business. Bosco explained that Dewberry Group’s real estate business is

structured so that it and its employees promoted,

managed, and operated all of the properties owned by

the Ownership Entities, and did so using the Infringing Marks. Id. Dewberry Group’s Executive Vice

President of Finance, John Freeman, provided testimony consistent with Bosco’s conclusions. Day 2 P.M.

Tr. 6:7–10:21; Freeman Dep. Tr. [Dkt. 218-5] at

68:12–70:9, 81:8–82:22, 91:14–92:8, 97:4–99:6,

103:13–105:17, 135:1-13. And, even though the Ownership Entities do not and cannot perform the work

and services necessary to generate revenues (but for

limited exceptions at the hotel), all revenues generated through Dewberry Group, Inc.’s services show up

exclusively on the Ownership Entities’ books. Day 1

P.M. Tr. 9:9–10:17 (Bosco).

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Furthermore, John Dewberry has contributed at

least $23 million to cover Dewberry Group, Inc.’s massive losses over the past 30 years. PX 690, ¶ 42; PX

710, ¶ 73; Day 2 P.M. Tr. 16:1-9 (Freeman). Because

no real estate or other business could continue as a

going concern after decades of losses like these, Bosco

rationally concluded that Dewberry Group, Inc.’s tax

returns, standing alone, do not tell the whole economic story. PX 690, ¶¶ 12–17; 40–51; PX 710, ¶¶ 40–

43; Day 1 A.M. Tr. 69:4–70:13.

Bosco’s analysis is supported by ample evidence,

and the Court concurs with his analysis. The Court

acknowledges the economic reality that, but-for the

revenue generated by the Ownership Entities, Dewberry Group as a single tax entity would not exist.

The Court further finds that American Rice is instructive. In that case, the Fifth Circuit held that

profits earned by a cooperative are “profits” for the

purposes of the Lanham Act, regardless of how they

may be passed on to members or how they are taxed.

American Rice, Inc. v. Producers Rice Mill, Inc., 518

F.3d 321, 339 (5th Cir. 2008). On appeal, defendant

argued that the district court erred in considering

profits as a recoverable Lanham Act damage item because, due to the nature of its business, defendant retained no profits; rather, they flowed through to the

member farmers. The plaintiff argued that defendant’s business structure is irrelevant to its obligations

as infringers, and the Fifth Circuit agreed. Id. The

Fifth Circuit found that defendant clearly earned a

profit on its sales, and that it passed the profits on to

its patrons. “The ‘flow-through’ of the profits to the

farms is certainly relevant to how [defendant] is

treated for tax purposes; however, [defendant] cites no

authority for the proposition that tax treatment is

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relevant to the Lanham Act remedies.” Id. The Fifth

Circuit therefore held that “profits earned by [defendant] are [defendant’s] profits for purposes of the Lanham Act, regardless of how such profits are passed on

or how they are taxed.” Id. at 340. See also Fifty-Six

Hope Road Music, Ltd. v. A.V.E.L.A., Inc., 778 F.3d

1059, 1076 (9th Cir. 2015) (upholding district court’s

refusal to reduce an infringer’s profit disgorgement

based on royalty fees paid to another entity where “the

royalty fee arrangement was not an arms’ length

transaction”); Aladdin Manufacturing Co. v. Mantle

Lamp Co., 116 F.2d 708, 713 (7th Cir. 1941) (holding

that an infringer cannot reduce the profits it must pay

for infringement by distributing those profits to partners or shareholders); 5 McCarthy on Trademarks

and Unfair Competition § 30:69 (“[P]rofits earned by

. . . a cooperative are ‘profits’ for purposes of the Lanham Act, regardless of how they may be passed on to

members or how they are taxed.”).

The Court therefore holds that Dewberry Group,

Inc. and its Ownership Entities will be treated as a

single corporate entity when calculating the revenues

and profits generated by Defendant’s use of the Infringing Marks. Again, the equitable purpose underlying the Lanham Act’s disgorgement remedy is to

prevent unjust enrichment and “take all the economic

incentive out of trademark infringement.” Am. Rice,

518 F.3d at 340. Consistent with the legal authority

cited above, this Court will not allow the non-arms’

length corporate dealings and tax treatment of Dewberry Group’s business enterprise to trump the economic reality of its profit infringement. To hold otherwise would not only ignore the economic reality of

how Defendant’s business operates, but also undermine the equitable purposes of the Lanham Act’s disgorgement remedy by enabling the entire Dewberry

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Group enterprise to evade the financial consequences

of its willful, bad faith infringement. That Plaintiff

did not name the Ownership Entities as defendants or

allege contributory infringement or alter-ego liability

is of no moment. The courts in American Rice, Aladdin, and Fifty-Six Hope Road Music and others did not

impose such requirements.

C. Bosco’s revenue calculations are overinclusive.

Plaintiff’s expert witness, Rodney Bosco, calculated the total profits attributable to Dewberry

Group’s use of the Infringing Marks during the infringement period to be $53,719,657. PX 710, ¶ 61 &

Fig. 3 (Revised); Day 1 A.M. Tr. 50:4–22.

By contrast, Defendant’s expert witness Lisa Miller claimed that little or none of the Dewberry Group’s

revenues at issue were attributable to the use of the

Infringing Marks. In particular, she noted that all of

Dewberry Group’s revenues and profits should be excluded based on her finding that leases with some tenants were signed before the infringement began, or

that communications with some other tenants occurred before the infringement began. Day 3 A.M. Tr.

28:13–30:11. From this, Miller concluded that none of

the revenues or profits from any property rentals

could be related to infringement. Id., 28:13–30:11.

Miller further argued that numerous other market

factors weigh on a prospective commercial tenant’s decision to lease a commercial property.

As for the Dewberry Hotel revenues, Miller opined

that they should be completely excluded because, in

her view, the hotel does not use the Infringing Marks.

Id., 41:9–11. And as for parking revenues, Miller

opined that they should be completely excluded

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because those revenues are either: (1) related to tenant leases; or (2) paid by transient parkers who, in her

view, would not consider names, marks, signs, or reputations in considering where to park. Id., 95:22–

96:1.

The Court addresses each of these arguments in

turn. As a preliminary matter, the Court acknowledges that profits disgorgement under the Lanham

Act is a remedy sounding in equity, allowing courts to

adjust an award up or down as circumstances demand. 15 U.S.C. § 1117. “[A] trial court, in assessing

the issue of damages under 15 U.S.C. § 1117(a),

should weigh the equities of the dispute and exercise

its discretion on whether an award is appropriate and,

if so, the amount thereof.” Synergistic Intern., 470

F.3d at 176. The Court acknowledges that it does not

provide a precise mathematical calculation of the profits earned by Dewberry Group, but rather weighs the

equities in determining the appropriate disgorgement

remedy.

The Court further acknowledges that Bosco conservatively evaluated the infringement period. Bosco

determined a starting date for the infringement at

each of the Dewberry Group properties relying on Defendant’s loan and leasing materials (among other

materials) bearing the Infringing Marks, and identifying each starting date in his report. PX 690, ¶¶ 27–

31, Fig. 1, 2 & App. A (PX 692); Day 1 P.M. Tr. 6:9–

8:9. Bosco did not start the infringement period for

any Dewberry Group property until the month after

the first documented use of the Infringing Marks that

he observed at each property. Day 1 A.M. Tr. 52:19–

54:6, 55:18–56:6. Bosco could not use start dates prior

to January 2018 because Dewberry Group did not produce profit-and-loss statements for any periods before

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January 2018. Day 1 A.M. Tr. 5:21-6:3. Bosco observed evidence showing first uses of the Infringing

Marks for properties that were earlier than the dates

reflected in his reports (e.g., PX 343 for Peachtree

Pointe; PX 347 for Dorchester Square; PX 379 for Ortega Park). Day 1 P.M. Tr. 16:9–19:1. What’s more,

the December 31,2020 end date for Bosco’s calculation

of Dewberry Group’s revenues and profits is also conservative, as the infringement has continued through

today. Dewberry Group did not produce any profitand-loss statements for 2021. Day 1 P.M. Tr. 4:23–

5:2, 19:2–6.

Recognizing this, the Court turns to the specific

issues with Bosco’s calculations as raised by Defendant Dewberry Group.

First, the Court reviews profits earned by the

Dewberry Group Properties other than the Dewberry

Hotel. Bosco’s Revised Supplemental Expert Report

indicates that total profits earned from these properties while using the Infringing Marks from 2018–2020

is $47,427,117. PX 710, ¶ 61 & Fig. 3 (Revised). However, the Court acknowledges that some leases within

these properties were indeed signed before the period

of infringement began. The Court agrees that the relevant Ownership Entities and their lessees therefore

had preexisting performance obligations as a result of

these pre-existing leases. These resulting streams of

revenue were already in place and were therefore unlikely to be the direct result of Dewberry Group’s use

of the Infringing Marks. At the same time, the Court

acknowledges that, once the Infringing Marks were

put into place, Dewberry Group had an ongoing and

active relationship with its lessees. These Infringing

Marks allowed the Ownership Entities to maintain

the existing contractual relationship with, and the

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revenue received from, a tenant—although the relationship and revenue had been previously established.

The Court finds the fact that some these leases

were in place prior to the period of infringement

should decrease the total disgorgement award due to

Dewberry Engineers. However, because of the large

number of leases signed in total throughout all of the

Dewberry Group Properties, and because of the many

variances in the rental cost and timeline of each lease,

it is not possible for the Court to be exact in its determination of the financial impact of the Infringing

Marks. Because the revenues earned from these preexisting leases cannot be fully attributed to the Infringing Marks, the disgorgement award will be reduced accordingly under the principles of equity.

Second, the Court addresses the profits earned

from the Dewberry Hotel. Bosco’s Revised Supplemental Expert Report indicates that profits earned

from The Dewberry Charleston Hotel while using the

Infringing Marks from 2018–2020 total $6,292,540.

PX 710 Revisions Figure 3. Defendant notes that

Plaintiff does not allege that the use of THE DEWBERRY® for hospitality services is an infringement.

Moreover, Defendant argues, the Infringing Marks

are not used in connection with hospitality services

associated with the hotel. See Dkt. 238 at 29. Plaintiff

argues, by contrast, that Bosco included its revenues

because Dewberry Group used Infringing Marks in

connection with financing and promoting the hotel

(e.g., negotiations and communications with investors, PX 292, 497; loan solicitations, PXs 414–16, 434,

473, 590; in Architectural Record magazine), and in

loan packages for other properties featuring the hotel.

PX 389 at 27; PX 532 at 29; see also Day 1 P.M. Tr.

11:22–14:7. Dewberry Group’s Director of Brand

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Development, Elizabeth Armstrong, further testified

that the Infringing Marks “really bring[] all of the

properties and hotel together” as part of “one unified

brand,” and that the hotel is advertised on Dewberry

Group’s website. Day 1 P.M. Tr. 79:7–9; 133:1–19.

The Court acknowledges that Plaintiff Dewberry Engineers did not allege that the use of THE DEWBERRY® for hospitality services is an infringement.

Further, an average patron of the hotel would not

know it to be in any way associated with the Infringing Marks. Therefore, the Court finds that the full

profit from the hotel of $6,292,540 from 2018–2020 as

calculated by Bosco should not be disgorged in its entirety. The Court will reduce the award in light of

this.

Third and finally, the Court addresses Miller’s argument that the parking revenues should be excluded

completely because those revenues are either: (1) related to tenant leases; or (2) paid by transient parkers

who would not consider names, marks, signs, or reputations in considering where to park. The Court

agrees with Plaintiff that Miller’s basing this assertion solely on her own personal parking experiences in

Atlanta is insufficient. Day 3 A.M. Tr. 94:23–96:1.

Her position is also undermined by evidence that

Dewberry Group promotes and performs its parking

services under its Infringing Marks. E.g., PX 341;

PX 483; PX 484; see also PX 710, ¶¶ 80–83. The Court

therefore finds that Dewberry Group’s efforts to exclude parking revenues are unavailing.

In summary, under the principles of equity set

forth under the Lanham Act, the Court will award a

portion of the revenues generated during the infringement period as calculated by Bosco. This reduction to

Plaintiffs requested award acknowledges the fact that

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some leases pre-dated the use of the Infringing Marks,

and that attributing the full revenue from these leases

is therefore inappropriate. Similarly, Plaintiff did not

allege that the use of THE DEWBERRY® for hospitality services is an infringement, an average patron

of the hotel would not know it to be in any way associated with the Infringing Marks. Given all this, the

Court will reduce the total award to Plaintiff by

twenty percent.

D. The burden was upon Dewberry Group

to prove costs or deductions claimed.

Finally, the Court notes that, after Dewberry Engineers established Dewberry Group’s revenues during the infringement period, the burden shifted to

Dewberry Group to prove (1) any costs or deductions

from those revenues, 15 U.S.C. § 1117(a) and (2) any

revenues that had “no relation” to the infringement.

The language of the Lanham Act could not be clearer:

“In assessing profits the plaintiff shall be required to

prove defendant’s sales only; defendant must prove all

elements of cost or deduction claimed.” 15 U.S.C.

§ 1117(a). See also Mishawaka Rubber & Woolen Mfg.

Co. v. S.S. Kresge Co., 316 U.S. 203, 206–07 (1942)

(“The burden is the infringer’s to prove that his infringement had no cash value in sales made by him.”);

American Rice, 518 F.3d at 337 (“[T]he Act allows the

plaintiff to recover the defendant’s profits based on

proof of the defendant’s sales. Once the plaintiff establishes the defendant’s sales, then it is the defendant’s burden to prove all elements of cost or deduction

claimed.”).

Dewberry Group failed to carry its twin burdens

of proof on deductions (such as reasonable expenses)

and non-infringement revenues. Defendant’s expert,

Miller, did no analysis of Defendant’s expenses.

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Instead, she argued only that “no revenues left that

apply to the alleged use of the marks.” DX 168 at 21.

Based on that unsupported position, Miller did no

analysis of Defendant’s expenses and no calculation of

Defendant’s actual profits; Miller conceded she “did no

actual calculations” regarding expense items used to

ratchet profit down to zero, and “did not do a profits

analysis,” simply because she had already (wrongly)

concluded there were zero infringement-related revenues. Day 3 A.M. Tr. 46:25–47:16; 59:15–18.

That Defendant declined to do this analysis puts

both the Defendant and the Court at a disadvantage.

Rather than rely on specific calculations of appropriate deductions set forth by the Defendant, the Court

must instead rely on more general notions of equity,

as discussed above, and determine its disgorgement

award accordingly.

E. This is an exceptional case warranting

attorneys’ fees.

Finally, the Court finds that this is an “exceptional case” under the Lanham Act, thus warranting

attorneys’ fee-shifting. In Verisign, Inc. v. XYZ.COM

LLC, 891 F.3d 481 (4th Cir. 2018), the Fourth Circuit

explained that: (1) the requisite standard of proof is

only a “preponderance of the evidence;” and (2) an “exceptional” case is one “presenting either subjective

bad faith or exceptionally meritless claims” that

“while not necessarily independently sanctionable—is

nonetheless so ‘exceptional’ as to justify an award of

fees.” Id. at 485, 487 (internal citations omitted).

Thus, while proof of willful or bad faith infringement

is no longer necessary, such conduct clearly remains

the hallmark of an “exceptional” case. This Court has

observed that proof of “an intent to infringe or deliberate disregard for the rights of the mark holder” is

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sufficient to make a case “exceptional.” Mazelmints,

2011 WL 2960873, at *5.

The record here demonstrates beyond a preponderance of the evidence that Dewberry Group engaged

in bad faith, intentional misconduct. Dewberry Group

pervasively breached the CSA over Dewberry Engineers’ objection, in contravention of its General Counsel’s false assurances, and in the face of multiple red

flags, which were cited by the Court on summary judgment, Dkt. 174 at 14–15, and bolstered at trial.

Courts have held that where a defendant infringes a

mark in disregard of clear obligations under a settlement agreement like the CSA, that the case is “exceptional.” E.g., Mya Saray, LLC v. Al-Amir, 831 F.

Supp. 2d 922, 937 (E.D. Va. 2011) (“[T]he defendants’

. . . intentional breach of the Settlement Agreement

[restricting defendants from using plaintiff’s trademarks] make this case exceptional” under the Lanham Act).

IV. CONCLUSION

Dewberry Group continuously disregarded Dewberry Engineers’ trademark and contractual rights.

Rather than abide by the outcome of the Prior Litigation and CSA, Defendant jettisoned the only “Dewberry” mark and logo allowed by the CSA, and then

brazenly rolled out and used four separate infringing

marks and sought federal trademarks for them. Ignoring red flags including the Prior Litigation, Defendant’s own acknowledgements of confusion risks,

the CSA, concerns raised by its employees, cease-anddesist letters from Dewberry, and multiple PTO refusals, Dewberry Group barreled ahead with its unlawful, all-encompassing rebranding. The Court finds

that, in addition to enforcing the already-entered permanent injunction, ordering disgorgement of profits

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and attorneys’ fee shifting is necessary to deter Dewberry Group from continuing its wrongdoing, and ensure that it doesn’t unjustly benefit from four years’

use of the Infringing Marks.

The purpose of the provision of the Lanham Act

allowing plaintiff to recover the infringing defendant’s

profits is to take all the economic incentive out of

trademark infringement. See American Rice, Inc. v.

Producers Rice Mill, Inc., 518 F.3d 321, 340 (5th Cir.

2008). “[A] trial court, in assessing the issue of damages under 15 U.S.C. § 1117(a), should weigh the equities of the dispute and exercise its discretion on

whether an award is appropriate and, if so, the

amount thereof.” Synergistic Intern., 470 F.3d at 176.

The Court applies these principles here, to find

that an award of $42,975,725.60 to Plaintiff Dewberry

Engineers is appropriate. This is a twenty percent reduction from Plaintiff’s requested award of

$53,719,657. This reduction accounts for the fact that

some leases in the Dewberry Group Properties predated the use of the Infringing Marks, and that Plaintiff did not allege that the use of THE DEWBERRY®

for hospitality services is an infringement. Again, the

Court notes that Defendant failed to calculate its own

expenses and non-infringement related revenues. Because Defendant failed to carry its burden, and because the Court cannot be exact in its determination

of the financial impact of the Infringing Marks for the

reasons previously discussed, it must instead rely on

more general notions of equity and determine its disgorgement award accordingly.

In conclusion, the Court AWARDS Plaintiff

Dewberry Engineers $42,975,725.60 in damages.

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As discussed above, the Court also finds that this

is an exceptional case warranting attorneys’ fees.

Plaintiff is directed to file a separate motion indicating the attorneys’ hours worked with particularity,

the billing rates of the attorneys involved, and an affidavit of reasonableness from a Northern Virginia

practitioner.

Finally, this Order is filed under seal. The Court

intends to unseal this Order in 10 days. If the parties

would like any part of the Order to remain under seal,

they should promptly file a motion.

It is SO ORDERED.

March 2 , 2022

/s/ Liam O’Grady

Alexandria, Virginia Liam O’Grady

United States District Judge

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APPENDIX C

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF VIRGINIA

Alexandria Division

DEWBERRY ENGINEERS, INC.,

Plaintiff,

DEWBERRY GROUP, INC.

F/K/A/ DEWBERRY CAPITAL

CORPORATION,

Case No. 1:20-cv00610

Hon. Liam O’Grady

Aug. 11, 2021

Defendant.

ORDER

This matter comes before the Court on Plaintiff’s

Motion for Summary Judgment (Dkt. 78) and on Defendant’s Motion for Summary Judgment (Dkt. 70).

The Court held a hearing on this Motion on July 30,

2021. For the reasons provided herein, Plaintiffs Motion for Summary Judgment is hereby GRANTED,

and Defendant’s Motion for Summary Judgment is

hereby DENIED.

I. BACKGROUND

In 2006, Parties entered into a confidential settlement agreement (“CSA”) which set out terms for the

use of the Dewberry name. Dkt. 81-2. According to

the terms of the CSA,

[e]xcept as provided in Paragraph B.3 . . . [Defendant] may use the DEWBERRY CAPITAL

name and mark in connection with its

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promotion, offering and performance of real

estate development services as a real estate

developer, including purchasing real property, arranging for the construction of commercial and residential buildings and mixed

use properties, and leasing and managing

properties.

Id. at § B(2). Additionally,

[Defendant] will not use the word Dewberry

in the name of, or as a mark for, and architectural and/or engineering company or in connection with any [such] services.

Id at § B(2). Plaintiff, on the other hand “may use its

Dewberry marks and names at any time for any services or products it chooses throughout the United

States and elsewhere.” Id. at § B(4). The CSA also

stipulated that “where feasible, [Defendant] shall continue to use its column logo in its current format” and

that “[Defendant] shall not use any logo or design

mark that depicts a “dewberry” or “berry”. Id. at

§ B(10)

In 2016, without informing Plaintiff, Defendant

rebranded from “Dewberry Capital” to “Dewberry

Group.” Defendant als

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