IP Law Daily, TRADEMARK—11th Cir.: Jury verdict on statutory damages for trademark infringement affirmed, (May 1, 2025)

By Carolin Dennis, B.Sc., LL.B., LL.M.

District court did not err in refusing to reduce a jury verdict that fell within the range of statutory damages permitted by the Lanham Act.

The U.S. Court of Appeals for the Eleventh Circuit affirmed a Georgia district court’s decision denying Star’s motion for judgment challenging the size of the jury verdict because the verdict fell within the range of statutory damages permitted by the Lanham Act and Star did not object to the jury instructions about awarding those damages (Top Tobacco, L.P. v. Star Importers & Wholesalers, Inc., No. 24-10765 (11th Cir. Apr. 30, 2025)).

Background. Top Tobacco, L.P. (Top), Republic Technologies (NA), LLC (Republic Technologies), and Republic Tobacco, L.P. (Republic) are the owners and exclusive sellers in the United States of cigarette rolling papers sold and distributed under the trademarks TOP® and JOB®. They sued Star Importers & Wholesalers, Inc. (Star) and Amin S. Hudda (collectively, defendants) asserting federal and state claims arising from the defendants’ alleged sale of cigarette rolling papers that contained counterfeit trademarks.

The district court granted summary judgment against Star on liability for trademark infringement and counterfeiting. It then held a trial to decide statutory damages. The jury found that Star did not act willfully, and it awarded Republic $123,000 in damages per mark below the maximum of $200,000 per mark permitted by section 1117(c)(1) for nonwillful infringement. The district court denied Star’s motion for judgment as a matter of law challenging the size of the verdict. The defendants’ appealed to review the district court’s denial of a motion for judgment.

Verdict not illegal for being larger than republic’s actual damages. Star argued that the verdict was illegal because it bore no relationship to the actual damages that Republic suffered. Republic argued that the verdict was legal because it fell within the range for statutory damages permitted by section 1117(c)(1).

The appellate court noted that nothing in section 1117(c) nor precedent suggests that statutory damages must be related to actual damages; instead, all signs point toward the opposite conclusion. Section 1117(c) states that plaintiffs may pursue statutory damages “instead of actual damages and profits.” Further, the district court instructed the jury that “an award of statutory damages should not constitute a windfall for the plaintiff and thus should bear some relationship to the actual damages suffered by the plaintiff and in consideration of the other factors.” The district court also instructed the jury that it could “consider a number of factors, including the value of the trademark, the deterrent effect on others besides the defendant, the potential for discouraging the defendant at issue and whether the counterfeit goods posed a risk to public safety.” Based on those factors, the evidence at trial supported a verdict greater than the actual damages.

The appellate court also noted that the jury also could have found that the award was necessary as a “deterrent” based on the testimony from several witnesses, including Amin Hudda, Star’s president, about the prevalence of counterfeiting in the wholesale industry. Additionally, Republic’s evidence about the unknown ingredient identified in the counterfeit rolling papers could have led the jury to render a larger award due to the “risk to public safety.” Thus, the district court did not err in refusing to alter the damages in the light of this evidence.

Verdict not illegal for possibly being based on deterrence. Star contended that the verdict was illegal because it imposed damages for punishment and deterrence even though the jury found no willfulness. Republic argued that the verdict was legal because the jury stayed within the range of statutory damages permitted for nonwillful infringement under section 1117(c)(1).

The appellate court noted that nothing in the record suggested that the jury punished Star with damages that could be awarded only for willful infringement. To the contrary, the jury rendered a verdict below the statutory maximum for nonwillful infringement. The appellate court held that because Star neither objected to the jury instructions at trial nor contested them on appeal, it was foreclosed from arguing that willfulness was a prerequisite to awarding statutory damages. Further, the appellate court stated that a jury can consider deterrence when the infringement is willful does not mean that a jury cannot also consider deterrence when the infringement is not willful.

Verdict did not violate Star’s right to due process. Star argued that the verdict violated the Due Process Clause of the U.S. Constitution. Republic contended that the upper limit for damages enshrined in section 1117(c) mitigated the risk that damages will be excessive as to violate the Constitution.

The appellate court found that the within-range verdict against Star was not so disproportionate as to offend the Constitution. In the light of Star’s concession that the maximum amount of actual damages possibly supported by the evidence, assuming the jury made every inference in favor of Republic, was $200,000, the verdict in this appeal was well below that ratio. Additionally, the verdict fell closer to the middle than the top of the range for statutory damages further confirming that it did not violate the Due Process Clause.

Therefore, the appellate court affirmed the denial of Star’s motion for judgment.

The Case is No. 24-10765.

Judge: Pryor, W.

Attorneys: Maia T. Woodhouse (Adams & Reese, LLP) for Top Tobacco, L.P., Republic Technologies (NA), LLC, and Republic Tobacco, L.P. Richard L. Robbins (Robbins Alloy Belinfante Littlefield, LLC) for Star Importers & Wholesalers, Inc., and Amin S. Hudda.

Companies: Top Tobacco, L.P.; Republic Technologies (NA), LLC; Republic Tobacco, L.P.; Star Importers & Wholesalers, Inc.

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