Wednesday, 11 May 2011

Should I Sue for Trademark Infringement? | Trademark Law Firm Tips

Clients often call with trademark infringement issues.  A trademark attorney can help you understand whether or not there is a likelihood of confusion between a third party use and your trademark.  Consumer confusion is, of course, the key to proving trademark infringement.  In this Trademark Law Radio Show, a trademark attorney discusses:

  • So, you've determined that someone is infringing your trademark.  Now, you need to know whether or not to send a trademark threat letter or sue for trademark infringement.
  • A trademark infringement lawsuit can be a complicated and expensive endeavor.  An experienced trademark lawyer can help you understand whether filing a lawsuit will provide a positive return on investment or is otherwise critical to your trademark protection program.  

I’m an experienced trademark attorney, and I’m going to try and help you understand some basics about trademark law.

Trademark infringement is becoming more common as more people turn to the Internet to search, shop and do business online.  More companies are displaying their goods and services on web pages.  Web site operators are displaying other people’s goods and services on their web pages.  More and more people go to the Internet every day for a variety of commercial activities. 

There are hundreds of millions of pages loaded each day across the Internet.  All of that activity has attracted “Black Hats" who target famous brands and trademarks in order to divert traffic from you and profit off your mark and the good will with your customers.

The question every trademark law firm hears from their clients is: “Should I sue for trademark infringement” if there is an unauthorized use of my trademark on the Internet? Can I sue that person in court?  Knowing when to send a trademark infringement threat letter and when to file a trademark infringement lawsuit requires lots of real world experience and expertise.  Every case is different and there are hundreds of variables, which a good trademark attorney will consider prior to giving a recommendation to a client to go ahead and file a lawsuit.

Our internet law attorneys are constantly analyzing these types of infringement issues for trademark clients just like you.  Here are some of the things you need to be thinking about when you are deciding whether or not to escalate from a trademark infringement threat letter to litigation.
 
The first thing you want to understand is that trademark litigation is very expensive.  If you decide to sue for trademark infringement, you will have to pay your own trademark attorney during the pendency of the case.  Attorney’s fees may be available, but only at the end of the case and only after you have been successful.  Very few, if any, law firms take trademark infringement cases on a contingency fee basis.  If your attorney is intimately familiar with your business model and company, and has a high level of understanding of the particular infringement issues you are facing, they may decide to put you on a hybrid fee basis, which is part hourly fee and part contingency fee.  In those cases, the trademark attorney will often work with you for a reduced rate in exchange for a percentage of any recovery, if a recovery is actually made.  But here’s what you need to know. 

Trademark infringement lawsuits often cost between $250,000 and $750,000 to prosecute all the way through trial.  Trials sometimes take years to occur after substantial discovery and a lot of procedural handling.  Some trademark cases are even more expensive to pursue if they are vigorously contested.  You should plan on a budget that will allow you to get to the trademark infringement case to the finish line.  The finish line is a jury trial. 
 
In deciding whether to sue for trademark infringement, you need to obtain as much information about the defendant as possible.  Is it an anonymous person who is going to be difficult to identify?  Does the defendant do business or reside in the United States and thus, subject themselves to United States jurisdiction?  Is the defendant collectible?  Even if you win a lawsuit, you still need to be able to collect money at the end of the day.  If the defendant is uncollectible, you will have achieved a hollow victory, and the trademark attorney’s fees that you have spent will not have been worth it. 
 
Another issue facing clients is to properly assess their goals.  Would you settle for something less than money damages?  When our trademark law firm hears a client tell us “I want to sue for money damages”, we make sure they are aware that there are other trademark infringement remedies available which may be easier and more cost-effective to achieve.  For instance, we can file a lawsuit for an injunction that might require the person to stop a particular infringing use to cease and desist from their infringing activity.  Sometimes, we are able to get an order which requires the domain name to be transferred to you, the client, so that you can control the domain and shut down the web site.  Sometimes, we can get an order from the court which will require the web hosting company to shut down the web site or domain.  Sometimes, we can get an order which will drag a person into court and make them explain why they’ve been engaging in the activity, why have they been infringing your trademark.  Obtaining a preliminary injunction or even a permanent injunction against someone who is engaging in trademark infringement can work well in straight forward and ‘slam dunk’ cases.  It is certainly something you want to consider before jumping into the courtroom. 
 
So, the next time you ask the question: “Should I sue for trademark infringement?," you need to ask yourself some basic questions and speak to a qualified trademark litigation attorney.  Get educated.  The best decisions are made by clients who are educated about the real information about the case, the case law, the defendant, and a cost-benefit analysis, which analyzing all these issues. 

As an experienced trademark infringement attorney, I always push clients to do a real cost-benefit analysis before jumping into Court.

 

COMMENTS

Trademark Infringement is not an easy subject. The basics are important to understand if you are threatening trademark infringement or have received an infringement threat letter. If the infringement occurs on the internet, you might want to speak with an attorney who knows about internet law as well as trademark law.

You litigation budget for a trademark infringement lawsuit can be substantial. If you are going up against a well funded defendant, or are being sued by a well funded plaintiff, you should plan on several hundred thousand dollars to conclusion, if not more. Work with your trademark counsel to set a budget and set expectations.

There are many steps in the legal process before you sue for trademark infringement. Too many clients jump right into trademark litigation without fully analyzing their trademark infringement case. Being prepared is important. That means getting your ducks in a row before your trademark attorney files a lawsuit.

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