Opinion ID: 471852
Heading Depth: 1
Heading Rank: 4

Heading: calculation of the award

Text: 31 Jartran raises numerous challenges to the district court's calculation of the award. Because the court, quite helpfully, fixed the same amount of the award under two distinct theories, we must affirm the award if it is proper under either theory. We hold that the calculation of the award based on U-Haul's corrective-advertising-expenditures theory, as enhanced under section 35 of the Lanham Act, was correct.
32 Jartran does not dispute the propriety of basing a damage award on corrective advertising expenditures. See, e.g., Otis Clapp & Son, Inc., v. Filmore Vitamin Co., 754 F.2d 738, 745 (7th Cir.1985). Jartran does argue, however, that the district court did not have discretion to award damages for corrective advertising expenditures more than twice the size of the original advertising expenditures. Jartran relies on Big O Tire Dealers, Inc. v. Goodyear Tire & Rubber Co., 561 F.2d 1365, 1375 (10th Cir.1977), cert. dismissed under Sup.Ct.R. 60, 434 U.S. 1052, 98 S.Ct. 905, 54 L.Ed.2d 805 (1978). There the court reversed a jury verdict and held that the plaintiff's recovery for corrective advertising was limited to 25% of the defendant's wrongful expenditures. Big O, however, is plainly inapplicable. It explicitly distinguishes itself from the plentiful earlier precedent allowing recovery of actual corrective advertising expenditures. In Big O the plaintiff had not made any corrective advertising expenditures. See id.; see also Cuisinarts, Inc. v. Robot-Coupe International Corp., 580 F.Supp. 634, 641 (S.D.N.Y.1984) (limiting Big O in the same manner). It provides no basis for overturning the district court's award in this case of actual corrective advertising expenditures. 33 Jartran's complaints as to the propriety of U-Haul's corrective advertising campaign should have been addressed to the district court. That court did consider arguments that the advertising was not necessary to correct harm to the U-Haul trademark; but it rejected them. We agree with the district court's conclusion. 34
35 Jartran attacks the district court's award, under section 35 of the Lanham Act, 15 U.S.C. Sec. 1117, of Jartran's profits from false advertising, double damages, and attorney fees. Jartran's position is supported by the text of the section, which applies only to a violation of any right of the registrant of a mark registered in the Patent and Trademark Office. U-Haul's trademark is not so registered. 36 Jartran, however, confronts the fact that these remedies have been held by this court to be available in actions under Lanham Act Sec. 43(a). See Transgo, Inc. v. Ajac Transmission Parts Corp., 768 F.2d 1001 (9th Cir.1985), cert. denied, --- U.S. ----, 106 S.Ct. 802, 88 L.Ed.2d 778 (1986). We explained: [W]e can see no reason to distinguish between registered and unregistered trademarks.... The type of conduct that these damages should deter is unrelated to the type of intellectual property protected. Id. at 1026. Jartran tries to distinguish this case on two grounds. First, that it is not a false advertising case. Second, that our decision in Transgo expressly limited its holding to the attorneys' fee remedy, refusing to address the other remedies provided by section 35. 37 Neither argument is persuasive. Not only do we see no significant distinction between false advertising cases and other cases under Lanham Act Sec. 43(a), see id., but also the rationale for the Transgo decision, viz. the need for remedial consistency in the recovery of attorneys' fees, is no less pressing when a court considers awarding damages and unlawful profits. We hold that the district court was correct in applying section 35 to this case. 38 Finally, Jartran contends that the district court should not have included the $6 million cost of its advertising campaign as profits within the meaning of Lanham Act Sec. 35 because Jartran did not make a profit during the relevant period. It is irrelevant that Jartran as a whole failed to turn a profit during the period of the advertising. The amount to be awarded is the financial benefit Jartran received because of the advertising. Cf. Otis Clapp & Son, Inc., v. Filmore Vitamin Co., 754 F.2d 738, 744-45 (7th Cir.1985) (affirming award of profits even though defendant's overall operations were unprofitable). The district court assumed that the financial benefit was at least equal to the advertising expenditures. Considering the detailed evidence that the court had of Jartran's swift revenue growth and the connection of that growth to Jartran's advertising, that finding is not clearly erroneous. We affirm the district court's award.