Amicus Curiae Brief — Contessa Premium Foods, Inc. v. Berdex Seafood, Inc.

covering a trademark infringer’s profits from the sale of

goods bearing the infnnging mark.

The Lanham Act, codified at 15 U.S.C. § 1051 ef seq.,

was enacted by Congress in 1946 to provide uniform, na-

tionwide rights for owners of trademarks, service marks, col-

lective marks, and certification marks,* thousands of whom

are members of INTA. Further to that purpose, Congress

codified in the Lanham Act the monetary remedies available

to mark owners against infringers in what is now

15 U.S.C. § 1117(a) (2000). Just as the Lanham Act should

guarantee mark owners uniform, nationwide nghts against

junior users, it should also guarantee a uniform standard for

the recovery of monetary remedies, including defendant’s

profits.

This purpose is frustrated by the current, fractured state

of the law regarding the standards for the recovery of an in-

fringer’s profits. Today, mark owners have an incentive to

bring infringement suits in circuits that do not require proof

of willful infringement as a prerequisite to the recovery of an

infringer’s ill-gotten profits. Similarly, parties that have

been accused of trademark infringement — but have not yet

been sued — have an incentive to file declaratory relief ac-

tions in those circuits that require mark owners to clear the

high evidentiary bar of proving willful infringement before a

court may consider whether to force the infringer to disgorge

its profits. This inconsistency in the application of the same

statutory language in 15 U.S.C. § 1117(a) undermines the

predictability and uniformity that the Lanham Act should

provide.

* Consistent with the convention adopted by the Lanham Act, this brief

refers to these designations collectively as “trademarks” or “marks.”

3

ARGUMENT

1. There Is a Clear Split in the Circuits on the Rele-

vance of an Infringer’s Willfulness to the Avail-

ability of Defendant’s Profits as a Remedy for

Trademark Infringement

The availability of monetary remedies to mark owners,

including disgorgement of an infringer’s profits from sales of

goods bearing the infringing mark, is governed by section 35

of the Lanham Act. That section provides, in part:

When a violation of any night of the registrant of a

mark registered in the Patent and Trademark Office, a

violation under section 43(a) [15 USC §1125(a) or

(d)], or a willful violation under section 43(c) [15

USC § 1125(c)], shall have been established in any

civil action arising under this Act, the plaintiff shall

be entitled, subject to the provisions of sections 29

and 32 [15 USC §§ 1111, 1114], and subject to the

principles of equity, to recover (1) defendant’s prof-

its, (2) any damages sustained by the plaintiff, and (3)

the costs of the action. The court shall assess such

profits and damages or cause the same to be assessed

under its direction.

15 U.S.C. § 1117(a). Despite the codification of remedies

for trademark infringement, the courts’ interpretation of sec-

tion 35(a) is fractured and conflicting. See generally Bryan

M. Otake, The Continuing Viability of the Deterrence Ra-

tionale In Trademark Infringement Accountings, 5 UCLA

ENT. L. REV. 221, 231 (1998) (noting that “[d]Jecisional

precedent is mixed and discordant” in discussing the varying

standards applied by courts in deciding when a disgorgement

of an infringer’s profits is appropriate).

As discussed at length in petitioners’ brief, there is a

three-way split among the Circuit Courts of Appeal on the

relevance of whether a defendant willfully infringed the

plaintiff's mark to the availability of a disgorgement of the

infringer’s profits as a remedy. Petitioners’ explication of

this three-way split is comprehensive, and INTA will not

4

burden this Court by repeating Petitioners’ analysis.” The

split can be summarized as follows:

1. The Third, Fifth, Seventh and Eleventh Circuits in-

terpret section 35(a) of the Lanham Act not to require a

showing of willfulness as a prerequisite to the disgorgement

of an infringer’s profits from the sale of infringing goods.

Although willfulness is a factor that the Court may consider

in deciding whether to award defendant’s profits, it is not a

requirement. See, e.g., Banjo Buddies, Inc. v. Renosky, 399

F.3d 168, 174 (3d Cir. 2005) (willfulness is not a prerequisite

to an award of infringer’s profits); Quick Techs., Inc., v. Sage

Group plc, 313 F.3d 338, 349 (Sth Cir. 2002) (“[W]e decline

to adopt a bright-line rule in which a showing of willful in-

fringement is a prerequisite to an accounting of profits.”);

Roulo v. Russ Berrie & Co., 886 F.2d 931, 941 (7th Cir.

1989) (“[T]here is no express requirement . . . that the in-

* The law in the First and Sixth Circuits on this issue is not as crystal-

lized as Petitioners’ brief implies. The Sixth Circuit case, Wynn Oil Co.

v. Am. Way Serv. Corp., 943 F.2d 595, 607 (6th Cir. 1991), cited by peti-

tioners for the proposition that that circuit does not require proof of will-

fulness for recovery of a defendant’s profits, makes that statement only in

dicta, which cited with approval the Seventh Circuit’s rule that willful-

ness is not required. (citing Roulo v. Russ Berrie & Co., 886 F.2d 931,

941 (7th Cir. 1989)). Nevertheless, the dispute in Wynn Oil was whether

the plaintiff was required to prove actual confusion to recover the defen-

dant’s profits, and the court cited the Seventh Circuit rule for the proposi-

tion that no such showing was required. Because the trial court had

found willful infringement, and the Sixth Circuit affirmed that finding,

the Sixth Circuit did not address whether willfulness was required for a

disgorgement of profits in its holding. In an earlier decision, Frisch’s

Rests., Inc. v. Elby's Big Boy, 849 F.2d 1012, 1016 (6th Cir. 1988), the

Sixth Circuit held that a plaintiff is required to prove willful infringement

before it may recover an infringer’s profits. The Sixth Circuit made no

effort to distinguish its earlier holding in Frisch’s.

It also is not clear that the First Circuit requires proof of willfulness for

disgorgement of profits if the trademark owner and trademark infringer

are not in direct competition. In 7amko Roofing Prods., Inc. v. Ideal

Roofing Co. Ltd., 282 F.3d 23, 36 (Ist Cir. 2002), cited by Petitioners,

the First Circuit expressly declined to decide whether willfulness is re-

quired in such circumstances. See id. at 29. Because willfulness had

been established in the trial court, the Court of Appeals did not need to

address the issue. See id.

5

fringer willfully infringe . . . to justify an award of profits.”);

Burger King Corp. v. Mason, 855 F.2d 779, 783 (11th Cir.

1988) (“Nor is an award of profits based on either unjust en-

richment or deterrence dependent upon a higher showing of

culpability on the part of the defendant... .”). The Third ©

Circuit in particular has held that Congress’ 1999 amend-

ment to 15 U.S.C. § 1117, which added the express require-

ment that the owner of a famous mark prove willfulness to

recover monetary’ relief for dilution under

15 U.S.C. § 1125(c), established that proof of willfulness is

not required for recovery of a defendant’s profits for trade-

mark infringement under 15 U.S.C. § 1125(a). See Banjo

Buddies, 399 F.3d at 174.

2. In contrast, the Second, Tenth and D.C. Circuits re-

quire a trademark owner to prove that the defendant willfully

infringed its mark in all circumstances. In those circuits,

proof of willfulness is a prerequisite to the recovery of prof-

its, not just one factor for the court to consider. See, e.g.,

Bishop v. Equinox Int’l Corp., 154 F.3d 1220, 1223 (10th

Cir. 1998) (“[A]n award of profits requires a showing that

defendant’s actions were willful or in bad faith.”); Banff, Ltd.

v. Colberts, Inc., 996 F.2d 33, 35 (2d Cir. 1993); ALPO Pet-

foods, Inc. v. Ralston Purina Co., 913 F.2d 958, 968 (D.C.

Cir. 1990). In these circuits, only after the trademark owner

establishes willful infringement may the court consider other

equities in deciding whether to order an accounting of defen-

dant’s profits.

3. Finally, the Ninth Circuit appears to employ a hybrid

standard for the disgorgement of an infringer’s profits. That

circuit permits a trademark owner to seek a disgorgement of

the infringer’s profits, without first proving willful infringe-

ment, where the trademark owner and infringer are in direct

competition, and the infringer’s profits are used as an ap-

proximation of the trademark owner’s actual monetary losses

caused by the infringement. See, e.g., Lindy Pen Co. v. Bic

Pen Corp., 982 F.2d 1400, 1406 (9th Cir. 1993).° If the par-

* It is not clear from the opinion of the Court of Appeals in this case

whether petitioners claimed any actual losses to the three respondents for

6

ties market non-competing products, or where they do not

compete in the same geographical regions, the trademark

owner must prove willful infringement as a prerequisite to

recovery of the infringer’s profits from its sales of the in-

fringing goods. The First Circuit has not yet expressly ruled

on whether a successful plaintiff is entitled to a disgorgement

of the defendant’s profits where the two parties were not in

direct competition. See Tamko Roofing Prods., 282 F.3d at

29 (declining to decide whether willfulness is required in

such circumstances).

This split requires resolution by this Court. In fact, this

case presents an opportunity for this Court to address the

remedies available to trademark owners under the Lanham

Act for the first time since 1967. See Fleischmann Distilling

Corp. v. Maier Brewing Co., 386 U.S. 714 (1967) (holding

that the Lanham Act, as then written, did not permit the

award of attorneys fees). All of the trademark cases that the

Court has reviewed in recent decades have addressed sub-

stantive nights of trademark owners, rather than the remedies

available to them for infringement. See, e.g., KP Permanent

Make-Up, Inc. v. Lasting Impression I Inc., 125 §. Ct. 542

(2004) (holding that accused trademark infringer does not

have the burden of proving absence of confusion to prevail

on a fair use defense); Qualitex Co. v. Jacobson Prods. Co.,

514 U.S. 159 (1995) (holding that colors may be subject to

trademark protection); Park ‘N Fly, Inc. v. Dollar Park &

Fly, Inc., 469 U.S. 189 (1985) (incontestable mark may not

be challenged as merely descriptive).

whom there was some evidence of distnbution of products bearing an

infringing mark.

” One of the issues raised in the petition for a writ of certiorari in Das-

tar Corp. v. Twentieth Century Fox Film Corp. was whether a court, ap-

plying the Lanham Act, could award twice a defendant’s profits for de-

terrent purposes. 539 U.S. 23, 25 (2003). The Court’s opinion did not

reach that issue, as it found that the plaintiff's claim for false designation

of origin failed on the mentts. /d. at 38.

7

II. The Court Should Grant Certiorari to Restore

Uniformity to Federal Trademark Law

The current split in authority runs counter to Congress’

purpose of providing uniform, nationwide nghts to trade-

mark owners when it passed the Lanham Act in 1946. Con-

gress designed the Lanham Act to provide a robust and con-

sistent, national scheme of protection for trademarks, to “se-

cur[e] to the [trademark] owner the good will of his business

and protect[] the public against spurious and falsely marked

goods.” S. Rep. No. 79-1333 (1946), as reprinted in 1946

U.S.C.C.A.N. 1274, 1274-75. As it became clear in the post-

war era that “trade [in the United States] is no longer local,

but is national,” protection of trademarks could no longer be

provided by the inconsistent amalgam of state law protec-

tions. Jd. at 1277. As a result, “a sound public policy re-

quire[d] that trademarks should receive nationally the great-

est protection that can be given them.” Jd. The Senate

Committee on Patents described this purpose as follows:

The purpose of this bill is to place all matters relat-

ing to trademarks in one statute and to eliminate ju-

dicial obscurity, to simplify registration and to make

it stronger and more liberal, to dispense with mere

technical prohibitions and arbitrary provisions, to

make procedure simple; and relief against infringe-

ment prompt and effective.

Id. at 1274 (emphasis added).

Despite the current split in the circuits on the standard

for recovering an infringer’s profits, courts have recognized

that Congress’ purpose in federalizing trademark law in the

Lanham Act was to create uniform, nationwide rights for a

national economy. Not long after the Lanham Act’s passage, _

Judge Learned Hand recognized that it “put federal trade-

mark law upon a new footing .. . and created rights uniform

throughout the Union, in the interpretation of which we are

not limited by local law.” S. C. Johnson & Son, Inc. v. John-

son, 175 F.2d 176, 178 (2d Cir. 1949).

More recently, this Court acknowledged Congress’s

goals by noting that “[nJational protection of trademarks is

desirable . . . because trademarks foster competition and the

maintenance of quality by securing to the producer the bene-

fits of good reputation.” Park ‘N Fly, 469 U.S. at 198; see

also Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763,

781-82 (1992) (Stevens, J., concurring) (“‘The purpose of

{the Lanham Act] is to protect legitimate business and the

consumers of the country,’ [and] [o]ne way of accomplishing

these dual goals was by creating uniform legal mghts and

remedies that were appropriate for a national economy.” (ci-

tation omitted)); Inwood Lab., Inc. v.. ves Lab., Inc., 456

U.S. 844, 861 n.2 (1982) (White, J., concurring) (noting pur-

pose of the Lanham Act to “codify and unify” the common

law of trademark protection).

When conflicting interpretations of the Lanham Act

among the Circuit Courts of Appeal have matured in the

past, this Court has granted certiorari to restore uniformity to

the law. Most recently, in its decision in KP Permanent

Make-Up, 125 S. Ct. 542 (2004), the Court noted that it

granted certiorari “to address a disagreement among the

Courts of Appeals on the significance of likely confusion for

a fair use defense to a trademark infringement claim, and the

obligation of a party defending on that ground to show that

its use is unlikely to cause consumer confusion.” See id. at

548; see also Moseley v. V Secret Catalogue, Inc., 537 U.S.

418, 428 (2003) (granting certiorari “because other Circuits

have also expressed differing views about the ‘actual harm’

issue” under the Federal Trademark Dilution Act); Qualitex

Prods., 514 U.S. at 161 (noting that the Court granted certio-

rari because “[t]he courts of appeals have differed as to

whether or not the law recognizes the use of color alone as a

trademark”’).

Uniform nghts are particularly important in a market-

place increasingly characterized by brands with national and

global reach. The current fractured state of the law frustrates

Congress’ purpose, and the Court should take the opportu-

nity that this case presents to resolve the split in the circuits

and restore uniformity to the law.

9

III. Resolution of the Split Will Discourage Forum

Shopping

In addition to frustrating nationwide uniformity to trade-

mark law, the present circuit split also encourages forum

shopping. The variation in standards for recovery across the

circuits provides both trademark owners and accused in-

fringers a strong motive to file suit in jurisdictions with a

standard for the recovery of _ profits under

15 U.S.C. § 1117(a) that is favorable to their particular posi-

tion. Specifically, plaintiffs have an incentive to seek relief

in circuits that allow recovery absent proof of willfulness,

while prospective defendants may seek declaratory judg-

ments in circuits that impose more exacting standards for

recovery.

This Court has consistently recognized the prevention of

forum shopping as necessary both to effectuate the will of

the legislature and to secure equity and efficiency in the ju-

diciary. See, e.g., Rumsfeld v. Padilla, 124 S. Ct. 2711, 2725

(2004) (finding that the requirement that habeas petitioners

challenging physical custody must file in the district of con-

finement “serves the important purpose of preventing forum

shopping”); Southland Corp. v. Keating, 465 U.S. 1, 15

(1984) (interpreting the Federal Arbitration Act so as to

avoid encouraging forum shopping); Walker v. Armco Steel

Corp., 446 U.S. 740, 745 (1980) (describing forum shopping

as an “undesirable result[]”); Hanna v. Plumer, 380 US.

460, 468 (1965) (describing “discouragement of forum-

shopping” as one of the twin aims of Erie R.R. v. Tompkins,

304 U.S. 64 (U.S. 1938)).

In the trademark context, the Court’s resolution of the

circuit split in Qualitex eliminated opportunities for forum

shopping that existed for owners of color trademarks. Be-

fore Qualitex, the threat of forum shopping loomed heavily

over trademark protection in color alone. See Craig Summer-

field, Color As A Trademark And The Mere Color Rule: The

Circuit Split For Color Alone, 68 CHI.-KENT. L. REV. 973,

978 (1993) (explaining that the split between the Ninth and

Seventh Circuits “[would] undoubtedly lead to forum shop-

10

ping due to the major difference in substantive rights”).

Qualitex clarified the potential trademark status of individual

colors and reduced potential forum shopping.

The Court’s condemnation of forum shopping is well-

founded. Permitting parties possibly to affect the substantive

outcome of infringement and unfair competition litigation by

selecting the forum with the standard for liability for profits

that is most favorable to their position results in uncertain

rights and obligations, and compromises the courts’ ability to

render like judgments under like facts. Under the current

state of the law, a trademark owner may be entitled to a dis-

gorgement of a defendant’s profits in one circuit, but may

not be entitled to the same remedy in a different circuit on

identical facts.

Inconsistent standards among the Courts of Appeals

have created uncertainty that is likely to bring about forum

shopping. This Court’s announcement of a clear, uniform

standard as to the relevance of willfulness to the disgorge-

ment of profits in a trademark case is the most effective way

to solve this problem.

CONCLUSION

Accordingly, INTA requests this Court to grant the peti-

tion for certiorari and restore national uniformity to federal

trademark law on this important issue.

Respectfully submitted, _

SALLY M. ABEL

TYLER G. NEWBY

CHRISTOPHER C. LARKIN

ALICE C. RICHEY

THEODORE H. DAVIS JR.*

* Counsel of Record

INTERNATIONAL TRADEMARK ASSOCIATION

655 Third Avenue, 10th Floor

New York, New York 10019

Telephone: (212) 768-9887

Attorneys for Amicus Curiae

International Trademark Association

1]

FILED |

Ser 205

No. 04-1693 OFFICE OF THE CLERK

S.

IN THE

Supreme Court of the United States

Contessa Premium Foods, Inc.,

Petitioner,

¥

Berdex Seafood, Inc., et al.

On Petition for a Writ of Certiorari

to the United States Court of Appeals

for the Ninth Circuit

REPLY BRIEF FOR THE PETITIONER

Laurence H. Tribe

(Counsel of Record)

Gregory J. Morrow

CONTESSA PREMIUM FOODS, INC.

222 West Sixth St.

San Pedro, CA 90731

Theodore A. Pianko

Gary Dukarich

Joel A. Kauth

CHRISTIE, PARKER & HALE, LLP

3501 Jamboree Road

Suite 6000

Newport Beach, CA 92660

September 14, 2005

Hauser Hall 420

1575 Massachusetts Ave.

Cambridge, MA 02138

(617) 661-9030

Thomas C. Goldstein

Amy Howe

Kevin K. Russell

GOLDSTEIN & Howe, P.C.

4607 Asbury Pl., NW

Washington, DC 20016

A tea RESENTMENT SS NEON A NR

WILSON-EPES PRINTING CO., INC. — (202) 789-0096 -— WASHINGTON, D.C. 20001

i

TABLE OF CONTENTS

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TABLE OF AUTHORITIES

Cases

ABKCO Music, Inc. v. LaVere, 217 F.3d 684 (CA9

Burger King Corp. v. Mason, 855 F.2d 779 (CAI11

NE itis cancch cakanseicsasguacaknidianicaakeniancmanesees RECO 8

Cartier, Inc. v. Four Star Jewelry Creations, Inc.,

S46 F. SUD: 24: ZE7 CS-DAY . 2004) vvccviwissscssscraisinvccencecs 5

Design Solange, Ltd. v. Lane Bryant, Inc., No. 99-

7805, 2000 U.S. App. LEXIS 1857 (CA2 Feb. 3,

iiss onde tension emake 5

Emco, Inc. v. Obst, No. 03-6432, 2004 U.S. Dist.

LEXIS 12,118 (C.D. Cal. May 7, 2004) .....0........ccsscsssseseees 5

Estate of Bishop v. Equinox int'l Corp., 256 F.3d

ROE CTE BED vies carta nciidsiisis Gadokicusesscsaiieeecuedes 5

First Savings Bank v. U.S. Bancorp, 117 F. Supp. 2d

Fe I A isch ce caksscapeilpcicincts added disnickinias 5

Frisch’s Restaurants, Inc. v. Elby’s Big Boy, 849 :

Ae SE ARE 1 MD 5 Goo hcanathiseasc eissamecige nds Gxeelpeuinitcdco 7

George Basch Co. v. Blue Coral, Inc., 968 F.2d

RPG BP Bh on 0 2: Geenietats Die tele Rem ee Or COE CNY RRO 5,8

Hot Wax, Inc. v. S/S Car Care, No. 97-6879, 1999

U.S. Dist. LEXIS 16,444 (D. Ill. Oct. 14, 1999) oe... 7

- Int'l Star Class Yacht Racing Ass'n v. Tommy

Hilfiger U.S.A., No. 99-7329, 2000 U.S. App.

LEXIS 060 (CAZ Fa. 12, DOO) osc ciscis sii jacsaposeias. 5,8

ISP.NET.LLC v. Qwest Communs. Int'l, Inc., No.

01-0480, 2004 U.S. Dist. LEXIS 20,237 (D. Ind.

SG, POs ative diana cteesasbans a chenuanmadiouse 7

Kassbaum v. Steppenwolf Productions, Inc., 236

FFE Be SE itaektinnicdaropabicagiibtpihinenaupentien 5

Landgraf v. USI Film Prods., 511 U.S. 244 (1994) ........... 3,4

il

Mastercard Int’l, Inc. v. First Nat'l Bank of Omaha,

Inc., No. 02-3691, 2004 U.S. Dist. LEXIS 2485

CREE FM 2S, DO inks aaa aac hens hzcwani 5

MGM Studios, Inc. v. Grokster Ltd., 125 S. Ct. 2764

ERE See OEE eT I ON = POPE SENOS CEL SENN 10

New Colt Holding Corp. v. RJG Holdings of

Florida, 312 F. Supp. 2d 195 (D. Conn. 2004) .......0..... 5

Nutting v. Ram Southwest, Inc., 69 Fed. Appx. 454

[go " 2 mis: 1° SeeRWR RED EREY Oboe tees Rabon aren cise REEDS ORES SipECop aE SER 5

Oyster Software, Inc. v. Forms Processing, Inc., No.

00-0724, 2001 U.S. Dist. LEXIS 22,520 (N.D.

RR Ae Ree ED wasp hacacsnscladictcauindesntesuaconssniscscucebspibinscasattias 5

Pfizer, Inc. v. Y2K Shipping & Trading, Inc., No. 00-

5304, 2004 U.S. Dist. LEXIS 10,426 (E.D.N.Y.

RN SiR Ge saa access ss cs pokanckadaGarngudoddansorabetioeasescssnaieves 5

Professional Bull Riders, Inc. v. Autozone, Inc., Nos.

03-1544, 04-1029, 2005 U.S. App. Lexis 17,262

Re NE 0 ch Hasek ccss Lanes pocns ecceeadawasainss 5

Roulo v. Russ Berrie & Co., Inc., 886 F.2d 931 (CA7

Lg 0g SPR O AES IOG alte’ RAGS CAGE TLR Sr RCeOR PE TONNES oP Seat RAIE ST 7

Sands, Taylor & Wood Co. v. Quaker Oats Co., 978

Pe EA Be kisi sschesicdsnvanaccasnic4vs ses snkgaacenescaciios 7

Verizon Communs., Inc. v. FCC, 535 U.S. 467

RO hoi Siclechas ss sutcuascisceet dese peas nlanlce oa a aaadbseoredoess 8

Wynn Oil Co. v. American Way Serv. Corp., 943

FA Te CR PMU PAS vcssten isk cuvdachapedscscoueiaedspuluccuiveachaceibberies 7

Statutes

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Pub. L. No. 100-667, 102 Stat. 3945 (1988)... |

Pub. L. No. 104-98, 109 Stat. 985 (1996)... ees fe

Pub: L. No. 106-435, £23 Stat. 259 CAGE) oo ccc ssiscsccestcaierse 2

1V

Other Authorities

Bee as Be TN TER Cea ccisccscvaicmanessnccsistcscntubetandedebion 2

l

REPLY BRIEF FOR THE PETITIONER

Respondents acknowledge that there is a division among

the courts of appeals over whether willfulness is a

prerequisite to an award of profits for a violation of Section

43(a) of the Lanham Act. See Berdex BIO 12, 16; IFP BIO 9.

Moreover, respondents do not seriously contest that the

question is important, as demonstrated in the amicus brief of

the International Trademark Association. Instead,

respondents’ principal argument against certiorari is that a

1999 amendment to the Lanham Act does not apply to this

case, rendering the case a poor vehicle for construing the

statute as currently enacted. See Berdex BIO 11-13; IFP BIO

4-6. This argument founders on its premise: the 1999

amendment did not change the meaning of the Lanham Act.

The 1999 amendment was merely a technical change to revise

the Act’s remedies provision to reflect changes that had been

made to the statute by the Federal Trademark Dilution Act of

1996, changes that were already in effect when the alleged

infringement in this case took place. See Pub. L. No. 104-98,

109 Stat. 985 (1996). Because this and the other objections

respondents raise against the petition are meritless, certiorari

on the first question presented should be granted.

l. Respondents fundamentally misconstrue the

significance of the 1999 amendment to petitioner’s argument

and to the meaning of the Lanham Act.

a. Since 1988, Section 35(a) of the Lanham Act has

authorized an award of profits, subject to principles of equity,

in the case of “a violation under section 43(a).” Pub. L. No.

100-667, Title I, § 129, 102 Stat. 3945 (1988). That

' As discussed infra, petitioner no longer seeks review of the

copyright issue addressed in the second question presented. As a

result, petitioner does not seek review of the judgment below as it

applies to respondents Hanwa American Corp., Slade Gorton &

Co., Inc., Mazzetta Company, L.L.C., Sea Port Products, or

Admiralty Island Fisheries.

2

language, which governs the award of profits sought in this

case, has never been modified. However, in 1996 Congress

amended the statute to permit awards of profits for willful

dilution of famous marks. The Dilution Act of 1995 added to

the statute Section 43(c), part of which provided that

{iJn an action brought under this subsection, the

owner of the famous mark shall be entitled only to

injunctive relief unless the person against whom the

injunction is sought willfully intended to trade on the

owner’s reputation or to cause dilution of the famous

mark. Jf such willful intent is proven, the owner of

the famous mark shall also be entitled to the

remedies set forth in sections 35(a) and 36, subject

to the discretion of the court and the principles of

equity.

Pub. L. No. 104-98, § 3(a), 109 Stat. 985 (1996) (enacting 15

U.S.C. 1125(c)) (emphasis added). Accordingly, as of 1996,

the Act distinguished between the criteria for an award of

profits for a violation of Section 43(a) and the criteria for an

award for violations of Section 43(c), explicitly requiring

willfulness only for dilution claims.

Congress failed, however, to amend Section 35(a) to

reflect this new authorization for profit awards in cases of

willful dilution. The 1999 Amendment rectified this

oversight. See Pub. L. No. 106-43, § 3(b), 113 Stat. 219

(1999); H.R. Rep. No. 106-250, at 6 (1999) (noting that the

“language of the Dilution Act presented to the President for

signing did not include the necessary changes to section]

35(a)” and that the 1999 amendment to Section 35(a) was

therefore “an attempt to clarify Congress’ intent and to avoid

any confusion by courts trying to interpret the statute * * *.”).

b. Respondents argue that certiorari should be denied

because petitioner’s claim depends upon the 1999 amendment

to the Act — which, they argue, cannot be applied to this case

because the alleged infringement occurred in 1997 and 1998.

See Berdex BIO 13 (citing Landgraf v. USI Film Prods., 5\1

3

U.S. 244 (1994)); IFP BIO 5-6 (same). That argument fails

for two reasons.

First, Landgraf has no application to this case. Petitioner

does not argue that the 1999 amendment itself authorizes the

award of profits petitioner seeks. Neither the 1999

amendment nor the Dilution Act altered the language of the

statute that directly governs petitioner’s claims in this case.

That language, authorizing an award of profits for “a violation

of Section 43({a),” has been unchanged since 1988. The

subsequent amendments relating to dilution claims simply

shed indirect light on the meaning of parts of the statute that

do apply directly to petitioner’s claims. In fact, as petitioner

described in its opening brief (Pet. 17-19), it has long been

clear that Congress did not intend that courts impose a

willfulness requirement or any other invariable prerequisite

for an award of profits for violations of Section 43(a). For

example, Section 35(a) has always included a proviso

excluding an award of profits against those who innocently

print infringing material. See 15 U.S.C. 1117(a) (cross-

referencing 15 U.S.C. 1114). Respondents do not even

attempt to explain why such an exception would have been

necessary if the Act precluded profit awards in the absence of

willful infringement as a general matter.

Because the 1999 amendment does no more than

indirectly confirm the pre-existing meaning of the Act, the

Landgraf presumption has no application. See, e.g., ABKCO

Music, Inc. v. LaVere, 217 F.3d 684, 689 (CA9 2000) (“We

have long recognized that clarifying legislation is not subject

to any presumption against retroactivity and is applied to all

cases pending as of the date of its enactment * * * .”’).

Second, respondents’ argument would fail even if the

Landgraf analysis did apply. Landgraf makes clear that “a

court is to apply the law in effect at the time it renders its

decision,” unless doing so would have an impermissible

“retroactive effect” that Congress did not explicitly authorize.

511 U.S. at 264 (citation and internal quotation marks

4

omitted). A “statute does not operate ‘retrospectively’ merely

because it is applied in a case arising from conduct antedating

the statute’s enactment, or upsets expectations based in prior

law.” Jd. at 269 (citations omitted). “Rather, the court must

ask whether the new provision attaches new legal

consequences to events completed before its enactment.” /d.

at 269-70.

As described above, the 1999 amendment attached no

new legal consequences to respondents’ prior conduct.

Indeed, the amendment effected no substantive change to the

Statute at all. It simply revised Section 35(a) to reflect the

willfulness requirement for dilution claims that had existed in

Section 43(c) since 1996, well before the infringement

alleged in this case took place. Thus, respondents’ rights,

liabilities, and duties under the Lanham Act are exactly the

same now as they were before the 1999 amendment. The

amendment therefore had no “retroactive effect” under

Landgraf and, as a result, properly applies to cases pending at

the time of the revision. See Landgraf, 511 U.S. at 280.’

2. Respondents concede that, absent a _ distinction

between pre- and post-1999 cases, there is at least a four-two

split among the courts of appeals regarding whether

willfulness is a prerequisite for an award of profits in a

trademark infringement case. See Berdex BIO 12 (citing

cases from the Second, Ninth, Tenth, and D.C. Circuits

imposing willfulness requirement); id. 14 (acknowledging

? Indeed, none of the respondents ever argued otherwise in the

proceedings below. In fact, in their brief to the Ninth Circuit,

respondents Berdex and Coast to Coast specifically cited the

current version of the Act in arguing that their lack of willfulness

precluded an award of profits. See Brief of Appellees Berdex

Seafood, Inc. and Coast to Coast Seafood, Inc. 36 (citing “15

U.S.C.A. § 1117(a) (West 1998 & Supp. 2003)"). Respondents

advanced this argument notwithstanding that, elsewhere in their

brief, they contended that the current version of the Copyright Act

did not apply to petitioner’s claims under that Act. See id. 17-20.

5

that the Third and Fifth Circuits have rejected a willfulness

prerequisite). Given that the 1999 amendment had no

substantive effect, there is no reason to believe that the

amendment will itself resolve the split. Indeed, during the six

years since the passage of the 1999 amendment, only the

Third Circuit has discarded its willfulness requirement.

Courts in other circuits, however, continue to reaffirm their

willfulness prerequisites despite the 1999 revision.’ The very

* Second Circuit: Design Solange, Lid. v. Lane Bryant, Inc.,

No. 99-7805, 2000 U.S. App. LEXIS 1857, at *3 (CA2 Feb. 3,

2000) (unpublished) (noting the “well-settled law of this Circuit

regarding monetary recovery, which requires either a finding of

‘wilful deception’ (for an accounting of profits) or ‘actual

consumer confusion or deception’ (to recover damages)”); Jnt’l

Star Class Yacht Racing Ass'n v. Tommy Hilfiger U.S.A., No. 99-

7329, 2000 U.S. App. LEXIS 660, at *2 (CA2 Jan. 12, 2000)

(unpublished) (reaffirming prior rejection of argument that

willfulness is not a prerequisite); see also, e.g., Mastercard Int'l,

Inc. v. First Nat'l Bank of Omaha, Inc., No. 02-3691, 2004 U.S.

Dist. LEXIS 24854S.D.N.Y. Feb. 23, 2004) (acknowledging 1999

amendment and Fifth Circuit rejection of willfulness prerequisite

but concluding amendment did not warrant reconsideration of

Second Circuit precedent); Pfizer, Inc. v. Y2K Shipping & Trading,

Inc., No. 00-5304, 2004 U.S. Dist. LEXIS 10,426, at *34 (E.D.N.Y.

Mar. 30, 2004) (“A finding of defendant’s ‘willful deceptiveness is

a prerequisite for awarding profits’ * * * .”); Cartier, Inc. v. Four

Star Jewelry Creations, Inc., 348 F. Supp. 2d 217, 253 (S.D.N_Y.

2004) (“A finding of willful conduct is a prerequisite for an award

of profits.”); New Colt Holding Corp. v. RJG Holdings of Florida,

312 F. Supp. 2d 195, 232 n.15 (D. Conn. 2004) (“[A] plaintiff must

prove that an infringer acted with willful deception before the

infringer’s profits are recoverable by way of an accounting.”)

(quoting George Basch Co. v. Blue Coral, Inc., 968 F.2d 1532,

1540 (CA2 1992)).

Ninth Circuit: Kassbaum v. Steppenwolf Productions, Inc.,

236 F.3d 487, 492 (CA9 2000) (“Actual consumer confusion is not

required for profit recovery; it is sufficient to show a likelihood of

confusion combined with willful infringement.”); Emco, Inc. v.

6

fact that the conflict continues unabated belies respondents’

claim that the 1999 amendment substantively changed the

Statute.

The split of authority is, in fact, even wider than

respondents acknowledge. As the petition explains (at 10-

11), the First and Ninth Circuits have adopted a unique hybrid

rule. Moreover, the Third and Fifth Circuits are not alone in

rejecting willfulness as a prerequisite to a profit award,

finding company in the decisions of the Sixth, Seventh, and

Eleventh Circuits. See Pet. 11-12.

Obst, No. 03-6432, 2004 U.S. Dist. LEXIS 12,118, at *10-*11

(C.D. Cal. May 7, 2004) (“In the absence of evidence that

[plaintiff] was damaged, it can receive an award of [defendant’s]

profits only by showing that [defendant’s] conduct was willful.”);

Oyster Software, Inc. v. Forms Processing, Inc., No. 00-0724, 2001

U.S. Dist. LEXIS 22,520, at *21 (N.D. Cal. Dec. 6, 2001) (“Courts

do not award an accounting unless there is some ‘deliberate and

wilful conduct.’”) (citation omitted).

Tenth Circuit: See Professional Bull Riders, Inc. v.

Autozone, Inc., Nos. 03-1544; 04-1029, 2005 U.S. App. Lexis

17,262, at *12 (CAIO Aug. 15, 2005) (unpublished) (reaffirming

that profit awards are available to “deter willful violations of the

trademark laws” and rejecting defendant’s contention that evidence

demonstrated lack of willfulness) (emphasis added); Estate of

Bishop v. Equinox Int’l Corp., 256 F.3d 1050, 1054-55 (CA10

2001) (reaffirming willfulness requirement); id. at 1060 (Baldock,

J., dissenting in part and concurring in part) (acknowledging circuit

rule that “[a] finding of willfulness or bad faith is a prerequisite to

an award of profits based on the deterrence theory of recovery,” but

disagreeing with majority’s application of the rule); see also

Nutting v. Ram Southwest, Inc., 69 Fed. Appx. 454, 459 (CAFC

2003) (unpublished) (“[W]illfulness of [the defendant’s] violation|]

* * * is a prerequisite to the award of any profits at all under Tenth

Circuit law.”); First Savings Bank v. U.S. Bancorp, 117 F. Supp. 2d

1078, 1088 (D. Kan. 2000) (“A plaintiff may not recover the

defendant’s profits without showing the ‘defendant’s actions were

willful or in bad faith.’”) (citation omitted).

7

Some of the respondents take issue with petitioner’s

reading of some of the circuit precedent (see Berdex BIO 16-

17), but their attempts to distinguish the cases cited by

petitioner are unconvincing. For example, respondents

Berdex and Coast to Coast argue (ibid.) that Roulo v. Russ

Berrie & Co., Inc., 886 F.2d 931, 941 (CA7 1989), did not

decide whether willfulness was required, but rather affirmed a

profit award in light of the district court’s finding of

willfulness. But the Seventh Circuit made clear that the

willfulness in that case was simply an equitable factor

supporting the award, not an absolute prerequisite. /bid.

Subsequent cases have applied the same rule. See, e.g.,

Sands, Taylor & Wood Co. v. Quaker Oats Co., 978 F.2d 947,

961 (CA7 1992) (“The Lanham Act specifically provides for

the awarding of profits in the discretion of the judge subject

only to principles of equity.”); see also JSP.NET.LLC v.

Qwest Communs. Int'l, Inc., No. 01-0480, 2004 U.S. Dist.

LEXIS 20,237, at *12 (D. Ind. Sept. 24, 2004) (“The Seventh

Circuit view considers willfulness or bad faith as a factor in

deciding whether to award damages or profits, but it does not

require such as a condition precedent.”); Hot Wax, Inc. v. S/S

Car Care, No. 97-6879, 1999 U.S. Dist. LEXIS 16,444, at

*24 (D. Ill. Oct. 14, 1999) (“The Seventh Circuit does not

require a showing of willfulness in order to award defendant's

profits as a remedy * * * .”).4

* Respondents Berdex and Coast to Coast also argue (at 17) -

that the Sixth Circuit’s approving quotation of Roulo in Wynn Oil

Co. v. American Way Serv. Corp., 943 F.2d 595, 606-07 (1991),

should not be read as adopting the Seventh Circuit’s interpretation

of the Act because the district court in Wynn Oil had found

willfulness. Petitioner has not found any subsequent case clarifying

the Sixth Circuit’s position. Amicus International Trademark

Association, however, points out (Br. 5 n.S) that the standard

approved in Wynn Oil appears to conflict with the standard

described in a prior case, Frisch’s Restaurants, Inc. v. Elby’s Big

Boy, 849 F.2d 1012, 1015-16 (CA6 1988). This confusion within