Vodka-Maker Garnered Sufficient Damages In Action Over Infringing Trade Dress

Wednesday, March 13, 2019

Page 1

Ninth Circuit:

Vodka-Maker Garnered Sufficient Damages In Action Over Infringing Trade Dress

By a MetNews Staff Writer


At left is a bottle of Crystal Head Vodka, next to a bottle of KAH tequila. The Ninth U.S. Circuit Court of Appeals yesterday rebuffed the contention of the company that makes the vodka that damages for infringement were inadequate.

The Ninth U.S. Circuit Court of Appeals declared yesterday that Globefill Inc., a company co-founded by actor/comedian Dan Aykroyd, was awarded all the damages that were warranted in an action for trade dress infringement based on its skull-shaped vodka bottles being mimicked by a tequila maker.

Globefill has produced Crystal Head vodka since 2007. It is contained in bottles inspired by the Mexican Day of the Dead.

Defendant Elements Spirits Inc. introduced KAH tequila in 2009—and its bottles are sufficiently close to those of Globefill that a jury in 2017 found an infringement.

Senior District Court Judge Consuelo B. Marshall of the Central District of California ordered that Elements and its founder, Kim Brandi, disgorge $871,536.86 in profits stemming from the infringement.

Amount Adequate

That, Globefill insisted, was not enough. Disagreeing, a three-judge panel said in yesterday’s memorandum opinion:

“The district court properly concluded that Elements’ earnings equaled 8% of gross sales of KAH Tequila (or $871,536.86) based on a 2010 Trademark Assignment and Royalty Agreement (TARA) between Elements and non-party Finos.

“None of Globefill’s arguments to the contrary is persuasive.”

The opinion says that Marshall did not err in denying a motion to add Finos as a judgment debtor. The notes that Globefill neither proved that Finos was an alter ego of Elements or that it controlled the litigation.

No Attorney Fees

Affirming the denial of attorney fees to Globefill, the opinion declares:

“The Lanham Act permits a district court to award attorneys’ fees to a prevailing party in ‘exceptional’ cases….The district court did not abuse its discretion in concluding that this case was not ‘exceptional.’…In so concluding, the district court did not err in giving substantial weight to Brandi and Elements’ reasonable litigation positions, while still considering the totality of the circumstances, including their intentional or willful infringement.”

A verdict in favor of Globefill was rendered by the second jury in the case. The first found in favor of the defendants, but the Ninth Circuit in 2016 reversed and remanded, holding that Marshall erred in denying Globefill’s motion for a new trial based on misconduct by Element Spirit’s counsel during summation.

Reference to a document that was not in evidence and misrepresenting its content undermined Globefill’s credibility on the determinative issue in the case—whether or not there was a likelihood of confusion between Globefill’s and Elements’ trade dresses,” the 2016 opinion says.