IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 01-11197

QUICK TECHNOLOGIES, INC.,

Plaintiff-Appellant,

versus

THE SAGE GROUP PLC and,

SAGE US HOLDINGS, INC.

Defendants-Appellees,

QUICK TECHNOLOGIES, INC.,

 Plaintiff-Appellant,

versus

SAGE SOFTWARE, INC.,

Defendant-Appellee.

Appeal from the United States District Court

for the Northern District of Texas

December 9, 2002

Before DeMOSS, STEWART, and DENNIS, Circuit Judges.

CARL E. STEWART, Circuit Judge:
 

1

In the Fall 2001, in light of the permanent injunctions issued by the district court on May 30,

2001, Sage U.S. Holdings, Inc. changed its name to Best U.S. Holdings, Inc. and Sage Software, Inc.

changed its name to Best Software of California, Inc. For purposes of this opinion, we will continue

to refer to these two entities as Holdings and Sage Software respectively. 

2

QuickTechnologies,Inc.(“QTI”)filed suit against The Sage Group plc (“SageGroup”), Sage

U.S. Holdings, Inc. (“Holdings”), and Sage Software, Inc. (“Sage Software”) (collectively

“Defendants”) for trademark infringement and unfair competition. Prior to trial, the district court

dismissed QTI’s claims against Sage Group for lack of personal jurisdiction. The district court

further denied QTI’s request to amend the pretrial order to add a corrective advertising claim.

Ultimately, QTI prevailed at trial against Holdings and Sage Software on its trademark infringement

claims and the district court entered permanent injunctions in QTI’s favor.1 QTI, however, did not

prevail on its claim for an accounting of Holdings’ and Sage Software’s profits. QTI appeals.

FACTUAL AND PROCEDURAL BACKGROUND

QTI was formed in 1992 and initially provided online information about distributors in the

promotional products industry (e.g. companies that imprint a business’s logo onto coffee mugs, key

chains, flashlights, etc.). QTI claims that by 1995, it had expanded its product offerings to include

such t hings as “online databases, online supplier advertising and other databases and business

software.” QTI began using the mark SAGE INFORMATION SYSTEM in January 1992 and has

been using a variety of marks which incorporate or use the word SAGE (e.g. SAGE, SAGE

INFORMATION SYSTEM, SAGE-CD, SAGE-ONLINE, and SAGE-CATALOG LIBRARY)

continuously since that time. 

Sage Group is a public limited company organized under the laws of England and Wales.

Sage Group manufactures and sellssoftware for accounting and business management purposes and
 

2 The Defendants stated in their brief: “That the application was not earlier abandoned . . . wasthe

result of a miscommunication among counsel for Defendants-Appellees.” 

3

its principal place of business is in England. On October 14, 1988, Sage Group received registration

for the mark SAGE in the United Kingdom. Beginning in 1991, Sage Group, acting through

Holdings, acquired several American companies that developed and sold accounting and business

management software. By 1995, Sage Group began to consider whether the company should adopt

an international brand name and ultimately adopted SAGE as such. 

On May 17, 1995, QTI filed an application with the United States Patent and Trademark

Office (“USPTO”) to registerthemark SAGEINFORMATIONSYSTEM. This mark was published

for opposition in 1996, at which time Sage Group claims it first learned of QTI’s use of the SAGE

INFORMATION SYSTEM mark. Negotiations began between Sage Group and QTI regarding use

ofthe mark. These negotiations eventually broke down and Sage Group filed a Notice of Opposition

to QTI’s use of the SAGE INFORMATION SYSTEM mark with the USPTO. 

On March 25, 1997, Sage Group filed an intent to use application for the mark SAGE with

the USPTO. Sage Group claims that it abandoned this application on March 11, 2002.2 In 1998,

Holdings and Sage Software began using the SAGE mark in connection with their respective

products. On May 22, 1998, QTI filed a lawsuit against Sage Group and Holdings alleging, among

other things, trademark infringement. On April 22, 1999, QTI filed a similar suit against Sage

Software and the cases were later consolidated into the instant case. On September 10, 1999, the

district court granted a motion by Sage Group to dismiss the claims against it for lack of personal

jurisdiction. 
4

This case was originally set for trial in November 2000. On November 9, 2000, the district

court reviewed the parties’ joint proposed Pretrial Order. Soon thereafter, the district court sua

sponte continued the case until April 2001. In January 2001, QTI retained new trial counsel. On

April2, 2001, QTI served Defendants with a proposed amended Pretrial Order seeking, among other

things, to add a damages claim for corrective advertising. On April 11, 2001, the district court

rejected QTI’s new Proposed PretrialOrder and entered the joint pretrial order previously submitted

to the court in November 2000. 

The case was tried before a jury. In addition to instructing the jury on the likelihood of

confusion issues, the district judge asked that the jury determine whether Holdings’ and Sage

Software’s infringement was done willfully, i.e. “Has QTI proven . . . the Defendants intended to

cause confusion, to cause mistake or to deceive?” The jury was further instructed that if it answered

“yes” to the question of willful infringement, it was to “[s]tate the damages, if any you award QTI

by reason of the profits made by the Defendants from the sale of software products since each

Defendant began using SAGE in commerce.” The jury returned a verdict for QTI on most of the

likelihood of confusion issues but did not find that the Defendants’ conduct was willful. Thus, the

jury did not award an accounting of profits. The district court entered final judgment on May 30,

2001, stating that “[h]aving considered the verdict and the applicable authorities, the Court

determined that permanent injunctive reliefshould be entered in favor of [QTI], but that no damages

should be awarded.” 

DISCUSSION

QTI presentsthe following issues on appeal: (1) whether the district court erred in dismissing

against Sage Group for lack of personal jurisdiction, (2) whether the district court abused its
 

3 Within QTI’s “Conclusion” to its initial brief, QTI summarily asks this Court to reverse and

remand the district court’s determination denying attorney’s fees. However, this argument is not

listed in the “Statement of Issues Presented for Appeal,” nor addressed in the body of the brief, thus

it is deemed waived. See United States v. Thames, 214 F.3d 608, 611 n.3 (5th Cir. 2000); see also

FED. R. APP. P. 28(a)(5) & 28(a)(9)(A). QTI’s scant references to the attorney’s fees issue in its

Reply Brief do not overcome the waiver in this case.

5

discretion in denying QTI’s request to amend the Pretrial Order to add a new damages claim based

on a theory of prospective corrective advertising, and (3) whether the district court erred in

instructing the jury that QTI must prove that the Defendants’ infringement was done willfully before

it could award an accounting of profits under Section 35(a) of the Lanham Act, 15 U.S.C. § 1117(a),

and in instructing the jury that willfully means “to do an act voluntarily and intentionally and with the

specific intent to cause the likelihood of consumer confusion.”3

I. Personal Jurisdiction

“The district court’s determination of the exercise of personal jurisdiction over a defendant

is a question of law subject to de novo review.” Mink v. AAAA Dev. Corp., 190 F.3d 333, 335 (5th

Cir. 1999). When personal jurisdiction is challenged, the plaintiff “bears the burden of establishing

the district court’s jurisdiction over the defendant.” Id. When the district court rules on a motion

to dismiss for lack of personal jurisdiction “without an evidentiary hearing, the plaintiffmay bear his

burden by presenting a prima facie case that personal jurisdiction is proper.” Wilson v. Belin, 20 F.3d

644, 648 (5th Cir. 1994). In making its determination, the district court may consider the contents

of the record before the court at the time of the motion, including “affidavits, interrogatories,

depositions, oraltestimony, or anycombination ofthe recognized methods of discovery.” Thompson

v. Chrysler Motor Corp., 755 F.2d 1162, 1165 (5th Cir. 1985).
6

QTI contendsthat it presented a prima facie case for specific jurisdiction under FederalRule

of Civil Procedure 4(k)(2). Rule 4(k)(2) states:

If the exercise of jurisdiction is consistent with the Constitution and laws of the

United States, serving a summons or filing a waiver of service is also effective, with

respect to claims arising under federal law, to establish personal jurisdiction over the

person of any defendant who is not subject to the jurisdiction of the courts of general

jurisdiction of any state.

“Rule 4(k)(2) thus sanctions personal jurisdiction over foreign defendants for claims arising under

federal law when t he defendant has sufficient contacts with the nation as a whole to justify the

imposition of United States’ law but without sufficient contacts to satisfy the due process concerns

ofthe long-armstatute of any particularstate.” Thompson, 99 F.3d at 720 (emphasis omitted). “The

due processrequired in federal cases governed byRule 4(k)(2) is measured with reference to the Fifth

Amendment, rather than theFourteenthAmendment.” Submersible Sys., Inc. v. PerforadoraCentral,

S.A., 249 F.3d 413, 420 (5th Cir. 2001). Furthermore, “[s]pecific jurisdiction over a nonresident

corporation is appropriate when the corporation has purposefully directed its activities at the forum

state and the litigation results from alleged injuries that arise out of or relate to those activities.”

Alpine View Co. v. AtlasCopco AB, 205 F.3d 208, 215 (5thCir. 2000) (internalquotations omitted).

In this case, there is no dispute that QTI’s trademark infringement claims arise under federal

law and neither side has claimed that Sage Group is subject to the jurisdiction of the courts of any

state. Thus, the only issue is whether exercise of jurisdiction is “consistent with the Constitution and

laws of the United States.” FED. R. CIV. PRO. 4(k)(2). In order to determine whether the exercise

of jurisdiction satisfies the Fifth Amendment, we must conduct the “now familiar minimum contacts

analysis . . . to determine whether the assertion of personal jurisdiction would offend traditional

notions of fair play and substantial justice.” Thompson, 99 F.3d at 723 (internal citations omitted).
 

4 QTI stated in its brief that it “is not seeking to have the activities of Sage Group’s U.S.

subsidiaries imputed to Sage Group for purposes of establishing jurisdiction under an alter ego

theory,” and acknowledged that “Sage Group does not directly sell its productsin the United States.”

7

QTI contendsthat the following contacts with the United States establish groundsforspecific

jurisdiction over Sage Group: (1) Sage Group filed an opposition to QTI’s trademark application

with the USPTO in which it asserted its use of the SAGE mark in commerce in the United States,

including in its U.S. marketing efforts; (2) Sage Group retained a U.S. attorney to file the opposition

and to negotiate with QTI; (3) Sage Group filed an intent-to-use application with the USPTO; (4)

Sage Group contacted U.S. companies concerning itsinternationalre-branding efforts, including one

trip to the U.S. by its Business Development Director; (5) Sage Group operated a web site,

www.sage.com, which provided information about Sage Group, as well as links to its U.S.

subsidiaries; and (6) Sage Group used the SAGE mark in publications circulated in the U.S. and

added the SAGE mark to “product advertisements, boxes and brochures” used by its U.S.

subsidiaries. 

Sage Group contends that this Court should only consider its filings with the USPTO and its

operation ofits website in our minimumcontacts analysis because those were the onlycontacts before

the district court at the time it ruled on the motion to dismiss for lack of personal jurisdiction. Even

considering all of the contacts cited by QTI, personal jurisdiction over Sage Group is inappropriate.

First, QTI’s claims do not sufficiently “arise out of or relate to” the contacts indicated by the

documents filed with the USPTO to establish specific jurisdiction. The documents filed by Sage

Group merely indicate that Sage Group owned variousregistrations of the mark SAGE in the United

Kingdom, it had the intention of using the mark in commerce in the United States, and itssubsidiaries

were currently using the mark in the United States.4 Sage Group’s filings with the USPTO further
8

indicate that it had used the mark SAGE in advertisements placed in publications which circulate in

the United States. Generally, advertisements are insufficient to establish personal jurisdiction. See

Singletary v. B.R.X., Inc., 828 F.2d 1135, 1136-37 (5th Cir. 1987) (concluding that advertisements

did not establish personal jurisdiction where there was no evidence that the “claimarose out of or was

related to” the advertisements). Second, Sage Group’s operation of a website containing company

and product information and linksto its U.S.subsidiaries also does not provide sufficient groundsfor

the exercise of personal jurisdiction. See Mink, 190 F.3d at 337 (finding that a website that is nothing

more than a “passive advertisement,” i.e. a website that provides product information, toll-free

telephone numbers, e-mail addresses, mail addresses, and mail-in order forms, does not support the

exercise of personal jurisdiction). Finally, Sage Group’s various contacts with U.S. companies,

including those related to its re-branding efforts with its U.S. subsidiaries, also do not involve Sage

Group using QTI’s mark in commerce in the U.S., thusthey do not form a sufficient basisfor specific

personal jurisdiction. 

For the foregoing reasons, we affirm the district court’s grant of Sage Group’s motion to

dismiss for lack of personal jurisdiction. 

II. Amendment to Pretrial Order

The district court’s decision not to allow QTI’s proposed amendment of the Pretrial Order

submitted shortly before trial is reviewed for an abuse of discretion. Masinter v. Tenneco Oil Co.,

929 F.2d 191, 194 (5th Cir. 1991). “Because of the importance of the pre-trial order in achieving

efficacy and expeditiousness upon trial in the district court, appellate courts are hesitant to interfere

with the court’s discretion in creating, enforcing, and modifying such orders.” Flannery v. Carroll,
 

5

 QTI correctly points out that the original Joint Pretrial Order presented to the district court in

November 2000 was not signed and entered by Judge Lynn at that time. On April 11, 2001, Judge

Lynn entered the Pretrial Order presented to her in November 2000 and explained that it was not

entered at the November pretrial conference “merely because it’s not customto enter these ifthe case

is not going to go to trial. But I reviewed it at the time, approved it at the pretrial before.” “It is a

well-settled rule that a joint pretrial ordersigned by both partiessupercedes all pleadings and governs

the issues and evidence to be presented at trial.” Kona Tech Corp v. S. Pac. Transp. Co., 225 F.3d

595, 604 (5th Cir. 2000) (quoting McGehee v. Certainteed Corp., 101 F.3d 1078, 1080 (5th Cir.

1996)). 

9

676 F.2d 126, 129 (5th Cir. 1982). Federal Rule of Civil Procedure 16(e) states that “[t]he order

following a final pretrial conference shall be modified only to prevent manifest injustice.” 

QTI assertsthat a damages claim based on prospective corrective advertising was mistakenly

left out of the Joint Pretrial Order presented to the district court in November 2000.5 The district

court, concerned with “fundamental fairness,” refused to allow QTI to modify the Pretrial Order.

QTI argues that the district court abused its discretion because Holdings and Sage Software would

not have been prejudiced by the amendment, rather, the amendment would have caused only a slight

inconvenience. Moreover, QTI argues that it was substantially harmed by not being allowed to

amend the Pretrial Order. We disagree. In Trinity Carton Co. v. Falstaff Brewing Corp., this Court

explained that:

Even though amendment of the Pretrial Order may be allowed where no surprise or

prejudice to the opposing part y results, where . . . the evidence and the issue were

known at the time of the original pretrial conference, amendments may generally be

refused. Each party has an affirmative duty to allege at the pretrial conference all

factual and legal bases upon which the party wishesto litigate the case. Failure to do

so may implicate waiver of the issue at the discretion of the trial court, subject to

considerations of fairness and efficient administration of justice.

767 F.2d 184, 193 n.13 (5thCir. 1985) (citation omitted). Accordingly, we find that the district court

did not abuse its discretion in refusing to allow the amendment.

III. Accounting of Profits
10

QTI sought to receive an accounting of Holdings’ and Sage Software’s profits pursuant to

15 U.S.C. § 1117(a), in addition to injunctive relief pursuant to 15 U.S.C. § 1116. Section 1117(a)

provides that:

When a violation of any right of the registrant of a mark registered in the Patent and

Trademark Office, a violation under section 43(a), (c), or (d) [15 U.S.C. § 1125(a),

(c), or (d)], or a willful violation undersection 43(c) [15 U.S.C. § 1125(c)],shall have

been established in any civil action arising under this Act, the plaintiff shall be

entitled, subject to the provisions of section 29 and 32 [15 U.S.C. §§ 1111, 1114],

and subject to the principles of equity, to recover (1) defendant’s profits, (2) any

damages sustained by the plaintiff, and (3) the costs of the action. The court shall

assess such profits and damages or cause the same to be assessed under its direction.

In assessing damages the court may enter judgment, according to the circumstances

of the case, for any sum above the amount found as actual damages, not exceeding

three timessuch amount. If the court shall find that the amount of the recovery based

on profits is either inadequate or excessive the court may in its discretion enter

judgment for such sum as the court shall find to be just, according to the

circumstances of the case. Such sum in either of the above circumstances shall

constitute compensation and not a penalty. The court in exceptional cases may award

reasonable attorney fees to the prevailing party. 

As this Court has previously stated, “[t]he goal behind §§ 1116 and 1117 remedies is to achieve

equity between or among the parties.” Seatrax, Inc. v. Sonbeck Int’l, Inc., 200 F.3d 358, 369 (5th

Cir. 2000). “A district court’s ruling regarding §§ 1116 and 1117 remedies is subject to an abuse of

discretion standard of review.” Id. The district court’s instructions to the jury are also subject to an

abuse of discretion standard of review. See Waco Int’l Inc. v. KHK Scaffolding Houston Inc., 278

F.3d 523, 528 (5th Cir. 2002). “Although we afford broad discretion in fashioning jury instructions,

the trial court must nevertheless instruct the jurors, fully and correctly, on the applicable law of the

case. . . .” EEOC v. Manville Sales Corp., 27 F.3d 1089, 1096 (5th Cir. 1994) (internal citations

omitted). 
 

6

 The jury charge entitled “willful infringement” stated as follows:

QTI claimsthat the Defendants willfully infringed itstrademark rights. “Willfully” means

to do an act voluntarily and intentionally and with the specific intent to cause the likelihood

of consumer confusion. 

If you answered Questions No. 1 or 2 [the likelihood of confusion questions] “Yes” as

to one or both Defendants, then answer the following question as to that Defendant.

Otherwise, do not answer the following Question.

Question No. 3:

Has QTI proven that in connection with the use of the name SAGE in the United States

the Defendants intended to cause confusion, to cause mistake or to deceive? 

 

7

 The jury charge entitled “damages” stated, in relevant part:

If you have found that Defendants’ infringement, if any, was willful, you may award QTI

the profits earned by the Defendants from the infringing activity. . . .

If you answered Question No. 3 “Yes” as to one or both of the Defendants, then answer the

following question asto each such Defendant. Otherwise do not answer the following Question.

Question No. 4:

State the damages, if any, you award QTI by reason ofthe profits made by the Defendants

from the sale of software products since each Defendant began using SAGE in commerce.

11

Section 1117(a) provides that “the Court shall assess such profits and damages or cause the

same to be assessed under its direction.” In this case, in addition to instructing the jury on the

likelihood of confusion issues, the district judge asked the jury to decide whether Holdings’ and Sage

Software’s infringement was done willfully.6 The jury was further instructed that if it answered

affirmativelyregarding thewillfulinfringement issue, it wasthen to determine the amount ofdamages,

if any.7 

QTI arguesthat the district judge erred by conditioning an award of profits upon a finding of

a particular mens rea, i.e. willful infringement. QTI contends, among other things, that a willfulness

requirement is contrary to the plain language of § 1117(a) and goes beyond the requirements of this
12

Court’s precedent. In contrast, the Defendants urge this Court to explicitly hold that willful

infringement is a prerequisite to an accounting of profits under § 1117(a). Alternatively, the

Defendants argue that the district court exercised its discretion appropriatelywhen it ruled in the Final

Judgment that QTI was not entitled to an award of profits. 

In considering these arguments, we are cognizant that several of our sister circuits have

embraced a willfulness requirement in order to obtain an award of profits. See SecuraComm

Consulting Inc. v. Securacom Inc., 166 F.3d 182, 190 (3d Cir. 1999) (holding that “a plaintiff must

prove that an infringer acted willfully before the infringer’s profits are recoverable”); Bishop v.

Equinox Int’lCorp., 154 F.3d 1220, 1223 (10thCir. 1998) (finding that “an award of profitsrequires

a showing that defendant’s actions were willful or in bad faith”); Minnesota Pet Breeders, Inc. v.

Schell & Kempeter, Inc., 41 F.3d 1242, 1247 (8th Cir. 1994) (stating that an accounting of profits

may be awarded based on various theories “[i]f a registered owner proves willful, deliberate

infringement or deception”); The George Basch Co. v. Blue Coral, Inc., 968 F.2d 1532, 1534 (2d

Cir. 1992) (holding that “in order to justify an award of profits, a plaintiff must establish that the

defendant engaged in willful deception”); ALPO Petfoods, Inc. v. Ralston Purina Co., 913 F.2d 958,

928 (D.C. Cir. 1990) (concluding that “an award based on a defendant’s profits requires proof that

the defendant acted willfully or in bad faith”). But see Adray v. Adry-Mart, Inc., 76 F.3d 984, 991

(9th Cir. 1995) (concluding that “[a]n instruction that willful infringement is a prerequisite to an

award of defendant’s profits may be error in some circumstances (as when plaintiff seeks the

defendant’s profits as a measure of his own damage)”); Roulo v. Russ Berrie & Co., Inc., 886 F.2d

931, 941 (7th Cir. 1989) (explaining that “[o]ther than general equitable considerations, there is no

expressrequirement . . . that the infringer willfully infringe . . . to justify an award of profits”);Burger
 

8

 For a comprehensive discussion of the viability of a willfulness requirement to an accounting of

profits under § 1117(a),see Danielle Conway-Jones, Remedying Trademark Infringement: The Role

of Bad Faith in Awarding an Accounting of Defendant’s Profits, 42 SANTA CLARA L. REV. 863

(2002).

13

King Corp v. Mason, 855 F.2d 779, 783 (11thCir. 1988) (“Nor is an award of profits based on either

unjust enrichment or deterrence dependent upon a higher showing of culpability on the part of the

defendant, who is purposely using the trademark.”).8 It is important to note, however, that prior to

the amendment of § 1117(a) on August 5, 1999, there were no references to the term “willful” in §

1117(a), thusthe decisions of oursister circuits are oflimited utility to the decision we are faced with

today. See Trademark Amendments Act of 1999, Pub. L. No. 106-43, 113 Stat. 219 (1999)

(substituting “a violation under section 43(a), or a willful violation under section 43(c),” for “or a

violation under section 43(a)”). 

Several of our previous cases are instructive. In Maltina Corp. v. Bottling Co., this Court

held that an accounting of profits may be proper “even if the defendant and plaintiff are not in direct

competition, and the defendants’ infringement has not diverted sales from the plaintiff.” 613 F.2d

582, 585 (5thCir. 1980). The Court concluded that an accounting of the profits the defendant earned

fromits willful infringement was proper and servestwo purposes- “remedying unjust enrichment and

deterring future infringement.” Id.

In Hard Rock Café International v. Texas Pig Stands, Inc., this Court affirmed a district

court’s denial of an award of profits notwithstanding a jury finding that Hard Rock Café’s

infringement was willful and that it was unjustly enriched by itsinfringement. 951 F.2d 684, 687, 689

(5th Cir. 1992). The Court approvingly cited the district court’s description of the situation: “While

the Court believes defendant sold pig sandwiches knowing of plaintiff’s mark, it appears this was
14

done not as an attempt to profit from the mark but rather in simple disregard of plaintiff’s rights.”

Id. at 695. This Court concluded that awarding Texas Pig Stands any of Hard Rock Café’s profits

from the sale of pig sandwiches would be a windfall because there was no evidence that the profits

were attributable to Hard Rock Café’s infringement. Id. at 696.

In Pebble Beach Co. v. Tour 18 Ltd., this Court adopted a factor based approach to the

determination of whether an award of profits is appropriate in trademark infringement cases. 155

F.3d 526 (5th Cir. 1998). The factors to be considered include, but are not limited to “(1) whether

the defendant had the intent to confuse or deceive, (2) whether sales have been diverted, (3) the

adequacy of other remedies, (4) any unreasonable delay by the plaintiffin asserting hisrights, (5) the

public interest in making the misconduct unprofitable, and (6) whether it is a case of palming off.”

Id. at 554; see also Rolex Watch USA, Inc. v. Meece, 158 F.3d 816, 823 (5th Cir. 1998) (citing the

Pebble Beach factors). Ultimately, this Court concluded that the district court in Pebble Beach Co.

did not abuse its discretion in denying an accounting of profits. The Court reasoned that because of

the “lack of actual damages and the lack of an intent to confuse or deceive,” injunctive reliefsatisfied

the equities of the case. Pebble Beach Co., 155 F.3d at 555.

More recently, this Court once again outlined its factor based approach in Seatrax, Inc. v.

Sonbeck International, Inc., 200 F.3d 358, 369 (5th Cir. 2000). With regard to remedies, the Court

noted that “[b]ecause each case presents a different set of facts and circumstances, a case-by-case

evaluation is warranted to determine the nature of the infringing conduct and its adverse effects, if

any, on the plaintiff.” Id. In Seatrax, the Court rejected the plaintiff’s contention that an accounting

of profits was appropriate because the defendant was unjustly enriched, explaining that “evidence of

unjust enrichment and diversion ofsales[was] speculative at best.” Id. at 372. Moreover, the Court
 

9

 QTI argues that the district court erred by instructing the jury that an infringing act is done

willfully if it is done “voluntarily and intentionally and with the specific intent to cause the likelihood

of consumer confusion” and with the intent to “cause confusion, to cause mistake or to deceive.” We

disagree. See Pebble Beach Co., 155 F.3d at 554 (describing the willfulness factor as “whether the

defendant had the intent to confuse or deceive”); see also Tamko Roofing Products, Inc. v. Ideal

Roofing Co., 282 F.3d 23, 36 n.10 (1st Cir. 2002) (“As to the meaning of willfulness, the jury was

instructed that ‘an act is done willfully if done voluntarily and intentionally.’”).

15

found that other factors weighed against an accounting of profits, i.e. the jury did not find that the

infringement was willful, the case did not involve palming off, and the permanent injunction would

provide “an effective deterrent to future infringement.” Id. Thus, the Court concluded that the

district court did not abuse its discretion in denying profits. 

It is obvious from our cases that willful infringement is an important factor which must be

considered when determining whether an accounting of profits is appropriate.9 In accordance with

our previous decisions, and in light of the plain language of § 1117(a), however, we decline to adopt

a bright-line rule in which a showing of willful infringement is a prerequisite to an accounting of

profits. Rather, we reaffirm the factor-based approach outlined in Pebble Beach Co., Rolex Watch

USA, Inc., and Seatrax, Inc.

Section 1117(a) remedies are awarded “subject to the principles of equity.” Thus, an award

of the defendant’s profitsis not automatic. See Champion Spark Plug Co. v. Danders, 331 U.S. 125,

131 (1947); Pebble Beach Co., 155 F.3d at 554. In order to determine whether an accounting is

appropriate, the court, or the jury in this case, considers the factors outlined in Pebble Beach Co.

“Once an award is found to be appropriate, a markholder is only entitled to those profits attributable

to the unlawful use of its mark.” Id. (citing Texas Pig Stands, Inc., 951 F.2d at 696).

In this case, the district judge instructed the jury that it should not reach the issue of awarding

profits unless it determined there was willful infringement. Under this instruction, the jury was only
16

afforded the opportunity to consider one factor, albeit an important one. If the other factors are

applicable to the case, such a limited instruction is improper. 

QTI asserts that only two of the Pebble Beach Co. factors are applicable to the facts of this

case - unreasonable delay by the plaintiff in asserting his rights and the public interest in making the

misconduct unprofitable. The Defendants do not allege any unreasonable delay by QTI in asserting

its rights. Because the jury was instructed that an award of profits was contingent on a finding of

willful infringement, and because the jury was not allowed to consider the public interest in making

the misconduct unprofitable in its damages determination, we conclude that the jury instruction

constitutes error. However, because the statute is heavily imbued with equitable considerations, an

error in the jury instruction does not end the analysis. When the evidence as a whole is measured

against the only two Pebble Beach Co. factors that are arguably applicable, the principles of equity

still do not weigh in favor of an award of profits to QTI. Notwithstanding the error in the jury

instruction which limited the jury to considering only wilfulness, QTI has not shown that the district

court abused the wide discretion afforded it by the statute in denying an award of profits. 

As we have previously held, “a markholder is only entitled to those profits attributable to the

unlawful use of its mark.” Id. (citing Texas Pig Stands, Inc., 951 F.2d at 696). In Texas Pig Stands,

Inc., we concluded that there was no evidence whatsoever that Hard Rock Café used Texas Pig

Stands’ good will to sell its pig sandwiches. 951 F.2d at 696. As the trial court in Texas Pig Stands,

Inc.summarized the situation, “HardRock would have sold just as many pig sandwiches by any other

name and . . . there is no basis for inferring that any of the profits received by [Hard Rock] from the

sale of pig sandwiches are attributable to infringement.” Id. (internal quotations omitted). The

defendant in Texas Pig Stands, Inc. “sold pig sandwiches knowing of plaintiff’smark, [but] it appears
17

this was done not as an attempt to profit from the mark but rather in simple disregard of plaintiff’s

rights.” Id. at 695. We believe this case poses a similar situation. Thus, as in Texas Pig Stands, Inc.,

“[t]he granted permanent injunction adequately remedies the complained-of infringement, and

awarding [the plaintiff] any of [the defendant’s] profits would be far from equitable - it would be a

windfall.” Id. at 696. Section 1117(a) affords wide discretion to the district court to apply principles

of equity when a claim for profits is made. Having considered the record as a whole, we find no

abuse of discretion by the district court when it declined to award profits to QTI in the judgment

entered on May 30, 2001.

CONCLUSION

For the reasons stated above, we AFFIRM the district court’s judgments.

AFFIRMED.