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Ninth Circuit Upholds Clothier's Fees Award If Related to Trademark Claim

On June 11, the Ninth Circuit upheld the Western District’s award of attorney’s fees on the false designation of origin claim in Derek Andrew, Inc. v. Poof Apparel Corp. However, the court cautioned that if the award included fees based on the Copyright Act, then the award was erroneous because Derek Andrew did not timely register its copyrights and, therefore, could not sustain its copyright claim for statutory damages. The court remanded the case for the Western District to clarify the basis for the award.

STL readers may recall that clothier Poof Apparel allowed a default judgment to be taken against it in this case, which involved Poof’s use of a heart design on hangtags it attached to its garments that was confusingly similar to “twisted heart” design hangtags that Derek Andrew had previously used. Trial, therefore, was limited to the fees issue. Magistrate Judge James Donohue awarded Bellevue clothier Derek Andrew a total of $296,090.50 in fees.

On this issue, the Ninth Circuit found:

“The district court entered default and Poof concedes that its default occurred with respect to a complaint that pled wilfulness. Thus, all factual allegations in the complaint are deemed true, including the allegation of Poof’s willful infringement of Andrew’s trademarks. This default sufficiently establishes Andrew’s fees under the Lanham Act. Because Poof does not contest the amount of fees, the district court’s award of fees under the Lanham Act is affirmed.

“Nevertheless, REMAND is proper because it is unclear whether the district court’s award of fees may have included fees related to Andrew’s Copyright Act claim. On remand, the district court must recalculate the fees award taking into account that Poof prevails as a matter of law on Andrew’s Copyright Act claim.”

The case cite is Derek Andrew, Inc. v. Poof Apparel Corp., __ F.3d __, 2008 WL 2357378, No. 07-35048 (9th Cir. 2008) (published).

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