Opinion ID: 420996
Heading Depth: 2
Heading Rank: 4

Heading: Remand for Determination of Lanham Act Damages.

Text: 47 We have concluded that Mason's post-termination use of the Burger King trademarks at those restaurants whose franchise agreements were lawfully cancelled constituted trademark infringement under Sec. 1114(1)(a) of the Lanham Act. We also hold that it was error to award profits, a trademark infringement remedy, for breach of the franchise agreements. While it may be tempting to simply treat the profits fixed as damages for the breach of contract as the proper measure of recovery for the Lanham Act trademark infringement and, consequently, avoid the necessity of a remand, such a course of action would be an improper exercise of our appellate role. 48 The damages provision of the Lanham Act stipulates: 49 When a violation of any right of the registrant of a mark registered in the Patent and Trademark Office shall have been established in any civil action arising under this chapter, the plaintiff shall be entitled, subject to the provisions of sections 1111 and 1114 of this title, 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 profits the plaintiff shall be required to prove defendant's sales only; defendant must prove all elements of cost or deduction claimed. 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 times such 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 circumstance shall constitute compensation and not a penalty. The court in exceptional cases may award reasonable attorney fees to the prevailing party. 50 15 U.S.C. Sec. 1117 (emphasis supplied). 51 This section vests considerable discretion in the district court. Guided by the principles of equity, the court may award the defendant's profits. Additional extraordinary relief such as treble damages and attorney's fees are available under the statute if the district court believes that such an assessment would be just. The statute also provides for the adjustment of any profits award if it is inadequate or excessive. This remedial accommodation clearly envisions the exercise of the trial judge's discretion. Consequently, it would be inappropriate for this court to attempt a determination of damages in the first instance. See Boston Professional Hockey Ass'n v. Dallas Cap & Emblem Mfg., Inc., 597 F.2d 71, 78 (5th Cir.1979). This is the traditional and statutory function of the district court. 11