IP Law Daily, TRADEMARK—5th Cir.: Trademark owner’s motion to dismiss an appeal from a non-final judgment granted for lack of jurisdiction, (Jul 21, 2026)

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

The Fifth Circuit found that the computation of damages was more than ministerial or mechanical.

The U.S. Court of Appeals for the Fifth Circuit dismissed URZ Trendz, L.L.C.’s appeal of default judgment where the district court had not yet quantified damages for lack of jurisdiction. The Fifth Circuit found that the default judgment was not a final order under 28 U.S.C. § 1291 because the district court had not yet quantified the damages owed to the trademark owner (Spectrum Laboratories, L.L.C. v. URZ Trendz, L.L.C., No. 25-20572 (5th Cir. Jul. 15, 2026)).

Spectrum Laboratories, L.L.C. (Spectrum), is a manufacturer of synthetic urine, and the owner of U.S. Trademark Registration No. 4453892 (’892 Registration) for the Quick Fix trademark (Quick Fix Mark) and U.S. Trademark Registration No. 5791421 (’421 Registration) for the Q design mark (Q-Clock Mark). The Quick Fix Mark, Q-Clock Mark, the individual components of the Quick Fix product and the combined trade dress of the Quick Fix product (collectively, Quick Fix trade dress) are associated in the minds of the public with Spectrum as the source of such products. Spectrum discovered counterfeit versions of its “Quick Fix” product in Texas that copied Spectrum’s packaging, including the Quick Fix Mark, the Q-Clock Mark and the Quick Fix trade dress (Counterfeit Product), were being sold by a company called Royal Fragrances, LLC, d/b/a City Supply Wholesale. The Counterfeit Product was being passed off as it if was legitimate product from Spectrum.

Spectrum filed a complaint against a retailer who sold the counterfeit synthetic urine for, inter alia, counterfeiting and trademark infringement under the Lanham Act. Eventually, Spectrum dismissed the retailer, obtained leave to amend its complaint, named 10 unknown Doe defendants, and issued third-party subpoenas to six businesses suspected of counterfeiting. URZ Trendz, L.L.C. (URZ), one of the Doe defendants, is a wholesaler of smoking products, sex toys, and novelty products. It did not comply with the third-party subpoena, so Spectrum added it as a named defendant. Spectrum eventually filed a third amended complaint, asking for, inter alia, lost profits, disgorgement of URZ’s profits, and injunctive relief. Following a protracted discovery battle including 10 discovery orders issued by the district court, Spectrum moved for case-terminating sanctions. The district court granted Spectrum’s motion and entered default judgment against URZ. The district court also struck URZ’s affirmative defenses and counterclaims, awarded attorneys’ fees and court costs against URZ and its counsel, and issued injunctive relief against URZ. Before the district court could quantify the damages due, URZ filed an appeal challenging the district court’s entry of default judgment in favor of Spectrum. Spectrum moved to dismiss URZ’s appeal for lack of jurisdiction.

Spectrum contended that the district court’s entry of default judgment was not a final judgment because the amount of damages were not yet calculated. URZ countered that the district court’s judgment was final for purposes of § 1291; and the injunctive nature of the default judgment gave the appellate court jurisdiction under 28 U.S.C. § 1292. However, the appellate court noted that when the computation of damages requires more than a simple application of predetermined amounts, any judgment entered before the calculation of such damages is not final. Further, the appellate court must ascertain all profits URZ obtained because of its counterfeiting “Quick Fix.” Moreover, it must determine any losses Spectrum suffered. These tasks, while perhaps not challenging for a professional accountant, go beyond the routine ministerial duties of courts. Additionally, URZ will likely dispute the damages amount, further obfuscating the court’s task. Accordingly, the task of computing damages was more than ministerial or mechanical.

The appellate court also rejected URZ’s argument that § 1292 provided jurisdiction based on the injunctive nature of the default judgment because URZ cited no authority for that proposition. In fact, the general rule is that discovery sanctions orders are not appealable until entry of the final judgment. Accordingly, the appellate court dismissed URZ’s appeal for lack of jurisdiction.

The Case is No. 25-20572.

Judge: Per Curiam.

Attorneys: David B. Cupar (McDonald Hopkins, L.L.C.) for Spectrum Laboratories, L.L.C. Louis F. Teran (SLC Law Group) for URZ Trendz, L.L.C.

Companies: Spectrum Laboratories, LLC; URZ Trendz, LLC

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