Statutory Damages For Counterfeit Goods Bars Attorney’s Fees

A trademark owner who seeks statutory damages for counterfeit goods cannot also recover attorney’s fees, the Ninth Circuit said.

Under the trademark law, a trademark owner who sues in a case involving counterfeit goods may elect to recover either three times the actual damages or statutory damages. The court found that the statute allows for the recovery of attorney’s fees when the case involves actual damages but not when the case involves statutory damages.

The case involved the sale on eBay of unauthorized decals bearing the logo of K and N Engineering, Inc., a company that designs, manufactures and distributes aftermarket air filters. The evidence showed that defendants sold 89 sets of the decals for $267. The district court awarded statutory damages of $20,000 and attorney’s fees of $100,000.

On appeal, the defendants argued that K and N’s election to receive statutory damages under 15 U.S.C. 1117(c) precludes the award of attorney’s fees under Sec. 1117(b). The appellate court agreed that Sec. 1117(c) makes no provision for attorney’s fees. “In this case, KandN elected to recover statutory damages under Sec. 1117(c). Because of K and N’s election, the court did not assess or award KandN actual damages or profits under Sec. 1117(a). Therefore, there is no statutory basis to award K and N attorney’s fees under Sec. 1117(b),” the court wrote.

K and N Engineering, Inc. v. Bulat, Ninth Cir. No. 06-55393, Filed Dec. 18, 2007.