IP Law Daily, TRADEMARK NEWS: Gibson nets only $4K for rival’s counterfeit guitar designs due to delay in pursuing rights, (Jun 1, 2022)

By Cheryl Beise, J.D.

A bigger win for Gibson was the jury’s finding that Gibson’s guitar body shapes and a headstock design are not generic.

Following a two-week trial, a federal jury in Sherman, Texas, has determined that Armadillo Enterprises willfully infringed and counterfeited registered trademarks protecting the body shapes and a headstock design used on Gibson guitars. Armadillo also was found to have infringed Gibson’s HUMMINGBIRD word mark. The jury additionally determined that Armadillo’s licenser, Concordia Investment Partners, contributed to Armadillo’s infringement. The jury rejected Armadillo’s claims that four of Gibson’s guitar body designs, including its iconic “Flying V Body Shape,” were so commonplace as to have become generic. However, because Gibson waited so long to file suit, to the detriment of Armadillo, the jury awarded Gibson a mere $4,000 in statutory damages and no actual damages (Gibson Brands, Inc. v. Armadillo Distribution Enterprises, Inc., May 27, 2022, Mazzant, A.).

In 2019, Gibson Brands, Inc., sued Amarillo Distribution Enterprises, Inc., the parent company of Dean and Luna Guitars, and Armadillo’s investment licenser, Concordia Investment Partners, LLC (together, “Amarillo”), alleging that the defendants copied several Gibson registered trademarks, including the “Flying V Body Shape,” the “Explorer Body Shape,” the “ES Body Shape,” the “SG Body Shape,” and the “Dove Wing Headstock” design marks and the HUMMINGBIRD, FLYING V, and MODERNE word marks. The complaint asserted claims for trademark infringement, counterfeiting, unfair competition, and dilution under the Lanham Act and related claims under Texas state law. Gibson sought compensatory and maximum statutory damages, including $2 million per counterfeit mark. Amarillo counterclaimed for cancellation of Gibson’s “Flying V,” “Explorer,” “ES-335,” and “SG” trademark registrations on the grounds that the shapes are commonplace and generic. Each side asserted affirmative defenses of laches and estoppel, among other things.

On June 24, 2020, the court denied Gibson’s motions to strike Amarillo’s counterclaims for acquiescence, mere descriptiveness, and invalidity. One month later, the court rejected Amarillo’s motions to strike Gibson’s affirmative defenses of laches and estoppel to Amarillo’s cancellation counterclaims. On January 28, 2021, the court issued three brief opinions denying summary judgment motions filed by Gibson, Amarillo, and Concordia, clearing the way for trial.

Following a two-week trial, the jury returned its verdict on May 27. The jury expressly found that the four Gibson guitar body shape marks challenged by Armadillo—the Flying V, the Explorer, the ES, and the SG—were not generic and subject to cancellation on that basis.

The jury concluded that Armadillo willfully infringed and counterfeited Gibson’s Flying V, Explorer, the ES, and the SG body shapes, as well as the Dove Wing headstock design mark, and the HUMMINGBIRD word mark. The jury also found that Concordia contributed to Armadillo’s infringement. The jury cleared Armadillo of claims that it infringed the FLYING V word mark.

The jury then found that Gibson unreasonably delayed in asserting its rights against Armadillo with regard to three marks: the Flying V Body Shape, the Explorer Body Shape, and the Dove Wing Headstock. Gibson’s delay was prejudicial to Armadillo, according to the jury. Consequently, the jury determined that Gibson failed to establish actual damages. On the issue of statutory damages, the jury awarded Gibson a mere $4,000.00.

Lastly, the jury rejected Armadillo’s counterclaim for tortious interference, as well as Gibson’s claim that Armadillo had engaged in unclean hands.

Following the verdict, both sides declared victory. In a statement, Gibson Brands haled the verdict as “a win for Gibson and the music community at large.” According to Gibson, the jury affirmed that Gibson’s trademarks are valid and not generic and that the defendants were “guilty of both infringement and counterfeiting.” Armadillo CEO Evan Rubinson reportedly praised the verdict as “vindication” of his company. The case is not over, however, as inevitable post-trial motions, including the possibility of injunctive relief, will need to be addressed at a future date.

The Case is No 4:19-cv-00358-ALM.

Attorneys: Stephen D. Howen (Law Office of Steve Howen) for Gibson Brands, Inc. Anna B. Naydonov (Finnegan Henderson Farabow Garrett & Dunner LLP) for Armadillo Distribution Enterprises, Inc.

Companies: Gibson Brands, Inc.; Armadillo Distribution Enterprises, Inc.

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