Presented by John Goodhue
In an opinion by Justice Gorsuch, the Supreme Court held — unanimously in the judgment — that a trademark plaintiff need not prove that the defendant acted willfully in order to recover the defendant's profits under Section 1117(a) of the Lanham Act. The Court reasoned from the statute's text: willfulness is an express precondition for a profits award only where the plaintiff proceeds under the dilution provision, Section 1125(c); no such requirement attaches to a Section 1125(a) claim, and the Act elsewhere shows considerable care in calibrating remedies to a defendant's state of mind. A defendant's mental state remains a highly important consideration in deciding whether to award profits in equity, but it is not an absolute precondition. Justice Alito, joined by Justices Breyer and Kagan, concurred; Justice Sotomayor concurred only in the judgment.
Romag Fasteners v. Fossil, decided April 23rd, 2020. The Supreme Court vacated the Federal Circuit and held that a trademark plaintiff need not prove the defendant acted willfully in order to recover the defendant's profits under Section 1117(a) of the Lanham Act. A defendant's willfulness is a highly important consideration, but not an absolute precondition. The judgment was unanimous. Justice Gorsuch wrote for the Court. Here's the brief.
Romag sells magnetic snap fasteners for use in leather goods. Fossil designs and sells a wide range of fashion accessories. Years earlier, the two signed an agreement allowing Fossil to use Romag's fasteners in its handbags. In time, Romag discovered that the factories Fossil had hired in China were using counterfeit Romag fasteners, and that Fossil was doing little to stop it. Romag sued for trademark infringement under Section 1125(a), the Lanham Act's false-association provision.
After trial, a jury sided with Romag. It found that Fossil had acted "in callous disregard" of Romag's rights. But the jury rejected Romag's accusation that Fossil had acted willfully, as the district court defined that term. That last finding proved decisive. Romag sought an order requiring Fossil to turn over the profits it had earned from the infringement, and the district court refused. It pointed to controlling Second Circuit precedent requiring a plaintiff who seeks a profits award to prove that the violation was willful. Not all circuits agreed. The Federal Circuit, applying Second Circuit law, affirmed, and the Supreme Court granted cert to resolve the split.
The question: does Section 1117(a) of the Lanham Act condition an award of the defendant's profits on proof that the defendant infringed willfully?
The statute governs remedies for trademark violations. The word that mattered was "willful." It appears in the text — but attached only to Section 1125(c), the dilution provision, a cause of action added to the Act years after its initial adoption for conduct that lessens the association consumers have with a mark. Romag's claim arose under Section 1125(a), where no such word appears. Fossil's argument rested instead on the phrase "subject to the principles of equity," contending that courts of equity had historically required a showing of willfulness before awarding profits in trademark cases.
Justice Gorsuch's reasoning began with the text. Because willfulness is an express precondition for a Section 1125(c) dilution claim but not for a Section 1125(a) claim, the Court declined to read the requirement in by implication.
Reading words into a statute, the Court explained, is a temptation it is doubly careful to avoid when Congress has used the term elsewhere in the very same provision. A wider look at the Act's structure confirmed the point.
The Act repeatedly and expressly calibrates remedies to a defendant's state of mind, so the absence of any willfulness standard in Section 1117(a) was telling. Fossil's appeal to the "principles of equity" fared no better: the historical record was far from uniform, and the phrase more naturally refers to broad, transsubstantive rules than to a narrow mental-state requirement drawn from trademark law. Still, the Court was careful about what it was not saying.
Two concurrences refined the reasoning. Justice Alito, joined by Justices Breyer and Kagan, wrote briefly to say the same thing in fewer words.
Justice Sotomayor concurred only in the judgment. She agreed there is no willfulness prerequisite, but faulted the majority for suggesting that courts of equity awarded profits as readily for innocent infringement as for willful infringement — a characterization she said did not reflect the weight of authority.
Romag resolved a long-running circuit split over the remedy that often makes trademark litigation worth pursuing: disgorgement of the infringer's profits. Some circuits, following the Second Circuit, had treated willful infringement as a categorical gateway to that remedy; others had not. The Court settled the question on the statute's text, and in doing so displaced the categorical rule. Willfulness is not an on-off switch for a profits award under Section 1125(a); it is one weighty factor a court, sitting in equity, may weigh in deciding whether disgorgement is warranted. The dilution provision, Section 1125(c), remains the one place the Act makes willfulness a true precondition. The line the Court drew is textual, and it should read the same way in any later dispute over the profits remedy.
Romag Fasteners v. Fossil, 590 U.S. 212, decided April 23rd, 2020. I'm John Goodhue. Thanks for watching.
These videos are educational case briefs, not legal advice, and watching them does not create an attorney-client relationship with the presenter or the firm. Case law and its interpretation evolves, always check a decision's subsequent history. Do not rely on these case briefs, but read the case yourself or have your attorney read them. Videos are presented via an AI avatar and voice clone of John Goodhue, created with his participation and consent.
