Last week, the Supreme Court of the United States issued an opinion in Romag Fasteners, Inc. v. Fossil, Inc., No. 18-1233 (April 23, 2020). Resolving a longstanding circuit split, the unanimous Court held a plaintiff in a trademark infringement suit is not required to prove willfulness to recover a defendant’s profits under the Lanham Act.
Romag designs and sells magnetic snap fasteners for handbags. Romag licensed its fasteners to Fossil, but later discovered counterfeit fasteners used on Fossil handbags. Romag sued Fossil in the District of Connecticut, alleging Fossil infringed its trademark rights and falsely represented its fasteners came from Romag in violation of 15 U.S.C. § 1125(a). The jury found Fossil acted “in callous disregard” of Romag’s rights, but rejected Romag’s allegation that Fossil acted “willfully.” Because Romag failed to prove willfulness, the district court denied Romag’s request for a recovery of Fossil’s profits. The Federal Circuit affirmed, applying Second Circuit law under which a plaintiff seeking to recover a defendant’s profits must prove the violation was willful.
The Supreme Court granted certiorari and reversed. The Court held the plain language of 15 U.S.C. § 1117(a) does not require proof of willfulness for a plaintiff to recover profits in trademark infringement cases. The Court noted the statute expressly requires a showing of willfulness to recover profits on a trademark dilution claim under § 1125(c), but does not require willfulness to recover profits on a claim brought under § 1125(a). The Court explained that under the Lanham Act, violations of § 1125(a) have “never required a showing of willfulness to win a defendant’s profits.” The Court further explained that the absence of an express mens rea requirement applicable to this subsection is “all the more telling” because, elsewhere, the Lanham Act “speaks often, expressly, and with considerable care about mental states.” The Court rejected the argument that equity courts historically required a showing of willfulness before authorizing a recovery of profits. After surveying pre-Lanham Act cases, the Court found that “a trademark defendant’s mental state is a highly important consideration in determining whether an award of profits is appropriate,” but concluded this was “a far cry” from insisting on willful infringement as an “inflexible precondition to recovery.” The Court declined to consider the parties’ policy arguments because “the place for reconciling competing and incommensurable policy goals” is “before policymakers.”