“No Right to Jury Trials for Disgorgement of Profits – A New Trend for Trademark Infringement Cases?” Intellectual Property & Technology Law Journal

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In an article published in the October issue of the Intellectual Property & Technology Law Journal, Hunter Freeman highlights an Eleventh Circuit decision in Hard Candy LLC v. Anastasia Beverly Hills Inc., holding that trademark owners who seek the disgorgement of an infringer’s profits in lieu of actual damages, such as lost sales or licensing, are not entitled to a jury trial because such a form of relief is equitable in nature.

Hard Candy filed the lawsuit in April 2016 centering around a Gleam Glow Kit makeup palette that Anastasia sold in retail stores such as Macy’s, Ulta and Sephora. The palette contained four facial highlighter colors, including a shade called “Hard Candy,” which Anastasia’s marketing materials described as a “mood-changing golden peach with a pink pearl reflective finish.” Anastasia also included the phrase “hard candy” in its social media posts and on the product itself.

The court found that Anastasia's use of the Hard Candy mark constituted a "fair use" and escaped trademark liability. Hard Candy then had an unsuccessful attempt to appeal the District Court's findings with the Court citing that the phrase hard candy had been used in a descriptive sense.

Freeman emphasizes the importance of a thorough trial strategy, as this case teaches that factors such as the difference in the standards of proof associated with legal versus equitable remedies, the advantages and disadvantage of a jury trial and the overall litigation budget should be carefully considered–before the complaint is filed.

Moreover, trademark owners should revisit their definition of what will make the outcome a success at various points during the litigation and re-evaluate their litigation strategy to ensure it continues to correspond with the potentially evolving definition of a win—and their expectations remain realistic.

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