In trademark infringement litigation, the form of monetary relief a plaintiff requests can determine whether the case is decided by a jury or a judge. This procedural distinction has real consequences, and a new request has been filed with the Supreme Court requesting that it settle the split among courts.
The question at issue is whether a trademark owner who seeks an accounting of the defendant’s profits rather than actual damages in connection with an infringement claim retains the right to a jury trial under the Seventh Amendment. Some courts have held that an accounting of profits is an equitable remedy, and therefore does not trigger any right to a jury.
That interpretation is now under scrutiny. Some trademark owners argue that when they seek profits as a substitute for damages, the remedy should be treated as legal rather than purely equitable. This, they argue, is particularly true when those profits represent a rough measure of the plaintiff’s lost sales. They point to the U.S. Supreme Court’s 1962 decision in Dairy Queen Inc. v. Wood, which held that the Seventh Amendment guarantees a jury trial for legal claims involving factual disputes, even if the relief is described in equitable terms.
In a recent petition for certiorari, the petitioner has asked the Supreme Court to resolve a growing circuit split over how Dairy Queen applies in trademark cases, contending that lower courts, particularly in the Sixth, Eighth, Ninth, and Eleventh Circuits misapply precedent and disallow a jury trial on both liability and damages where the plaintiff seeks an accounting. Trademark plaintiffs, petitioner claims, have the right to a jury trial on both liability and damages regardless of how such damages are labeled or measured.
This question has immediate practical implications as plaintiffs often seek profits in order to avoid the burden of proving their own losses, especially in cases where the defendant’s gains may be easier to establish. If doing so eliminates the jury right, plaintiffs may have to forego a jury where their own damages are difficult to assess. For defendants, the prospect of a jury trial may shape settlement strategy and trial posture.
Until the Supreme Court offers clarity, trademark owners should be aware that seeking profits may come at the cost of having their claims heard by a jury. For now, an understanding of local precedent on the issue and careful pleading remain essential when deciding how to frame monetary relief in a trademark case.
Prior precedent "held that the Seventh Amendment right to a jury trial applies to trademark actions seeking monetary relief, regardless of whether the relief is cast as an 'accounting' of profits rather than damages, according to" the petitioner.
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