Seattle Trademark Lawyer

By popular demand, here are the jury instructions in the Adidas America, Inc. v. Payless Shoesource, Inc. case. All 60 pages of them. The ten pages of instruction on dilution start on page 38.

Besides a reader’s request for the instructions on dilution, everyone is commended to check out the entire instructions. This case was the full meal deal — it had instructions on trademarks, trade dress, trademark infringement, likelihood of confusion, unfair and deceptive practices, dilution, and damages. This is good stuff.

The case cite is Adidas America, Inc. v. Payless Shoesource, Inc., No. 01-1655 (King, J.).

Interesting to see juror notes become a part of the docket in the recently-decided case of Adidas America, Inc. v. Payless Shoesource, Inc. As many will recall, an Oregon jury last week found Payless’ use of two- and four-stripe designs for athletic shoes infringed Adidas’ three-stripe design for its competing athletic shoes.

In an undated note to District of Oregon Judge Garr M. King, a juror asked: “If this case was found for adidas, would adidas own 2 and 4 stripes?”

The court’s response: “The legal ownership of two and four stripes, generally, is not an issue in this case. The issues for consideration involve only the shoes accused in this case.”

This guidance undoubtedly is correct. But for a litigator it’s always fascinating (and, I’ll admit it, sometimes scary) to see what goes through jurors’ minds. This was important enough a question for a juror to ask — and the response essentially was an instruction that the juror was barking up the wrong tree. I’ve participated in mock trials and seen mock jurors in deliberation latch onto something that neither side argued and that had no basis in the law. Imperfect though our system is, you just hope and ultimately trust that the jury’s collective wisdom will figure out on whose side justice lies.

The case cite is Adidas America, Inc. v. Payless Shoesource, Inc., No. 01-1655 (King, J.).

After the Settlement: Portions of Blue Nile’s and James Allen’s 
“BUILD YOUR OWN RING” and “Design Your Own” Web pages

On May 8, Western District Judge Thomas Zilly dismissed Blue Nile, Inc.’s lawsuit against competing online jeweler James Allen Diamonds, Inc. and JamesAllen.com LLC based on the parties’ stipulation. The complaint had alleged that defendants’ use of BUILD YOUR OWN RING as a trademark infringed Blue Nile’s prior common law rights in the same mark. Defendants had denied Blue Nile’s allegations and asserted in counterclaims for declaratory judgment that their use of the words did not infringe Blue Nile’s trademark rights and that BUILD YOUR OWN RING was invalid because it did not function as a protectable trademark.

The terms of the settlement are not known to STL, but it appears that defendants have changed their alleged use of “Build Your Own Ring” to “Design Your Own” and “Design Your Own Ring” on their Web site. Plaintiff continues to use BUILD YOUR OWN RING on its Web site.

The case cite is Blue Nile, Inc. v. James Allen Diamonds, Inc., No. 07-1443 (W.D. Wash.) (Zilly, J.).

On May 5, hair salon franchisor Fantastic Sams Franchise Corp. filed suit in the Western District against rival hair salon franchisor Regis Corp. and other defendants. Fantastic Sams alleges that Regis convinced the corporation that owned the right to develop and grant third parties FANTASTIC SAMS franchises in the Seattle-Tacoma market to sell its salons to Regis. Fantastic Sams alleges that immediately after closing on its purchase, Regis began operating the salons under its HAIR MASTER brand but failed to remove all of the FANTASTIC SAMS marks from the premises. This, Fantastic Sams alleges, is likely to confuse consumers and amounts to service mark infringement and unfair competition.

Regis has not yet filed an answer.

The case cite is Fantastic Sams Franchise Corp. v. Regis Corp., No. 08-706 (W.D. Wash.).

On May 5, a nine-person jury in the District of Oregon found Payless Shoesource, Inc., liable for infringing Adidas America, Inc.’s three-stripe trademark and awarded Adidas $305 million. The jury found Payless infringed or diluted Adidas’ mark or trade dress by using a two- and four-stripe logo on its competing athletic shoes. Trial lasted 14 days. The jury deliberated for two days. 

An attorney representing Adidas said he thought it was the biggest verdict in a trademark infringement case ever. Collective Brands Inc., which operates Payless and Stride Right stores, said the award was “excessive and unjustified” and vowed to have it set aside or overturn.

An excerpt from the jury verdict form showing Payless’ shoes.
“Yes” indicates infringement.

From the jury verdict form:

“Section III.  Monetary Recovery

8) State the amount of actual damages that should be awarded to adidas, if any.

$30,610,179

9) Do you find that Payless acted willfully or in bad faith with regard to any of the claims in Question Nos. 1-7 above for which you answered ‘Yes’?

   X    Yes                No

10) If you answered ‘Yes’ to Question No. 9, state the amount of Payless’s profits that should be awarded to adidas, if any.

$137,003,578

11) Concerning a possible award of punitive damages, do you find that Payless has acted with malice, or in wanton and reckless disregard of the rights of adidas, or if deterrence is called for and Payless’s conduct is particularly aggravated?

   X    Yes                No

12) If you answered ‘Yes’ to Question No. 11, state the amount of punitive damages that should be awarded to adidas, if any.

$137,003,578”

The docket entry describes the result as follows: MINUTES OF SIXTEENTH DAY OF JURY TRIAL - Completed. Jury deliberations conclude. 9 juror lunches ordered from the Lotus Cafe. Jury verdict returned in favor of the Plaintiff. Jury polled and discharged. (See Verdict and Clerk’s List of Witnesses).

Gotta love the court’s “just the facts, ma’am” style.

Wow, what a result!

The case cite is Adidas America, Inc. v. Payless Shoesource, Inc., No. 01-1655 (King, J.).