Court Opinion

ID: 9482857
Source: CourtListenerOpinion
Date Created: 2023-08-05 09:02:57.37168+00
Date Added: 2024-06-11T17:49:15.139477
License: Public Domain

MINER, Circuit Judge,
dissenting:
I would affirm the judgment of the district court.
Pursuant to Fed.R.Civ.P. 68, the Good-mans offered to allow judgment to be taken against them for $1,000, exclusive of costs and exclusive of any attorney’s fees that might be awarded by the court, and “for a permanent injunction in accordance *275with the Court’s Memorandum Opinion and Order, filed on the 10th day of August, 1988.” The offer, prepared by the Good-mans, was accepted by Goodheart, and a judgment was entered in the language of the offer. Indeed, the district court had no alternative but to enter the judgment exactly as offered and accepted, in view of the “self-executing” nature of Rule 68 judgments. See Mallory v. Eyrich, 922 F.2d 1273, 1279 (6th Cir.1991).
It seems to me that the intention of the parties in the contractual situation in which they found themselves was clear: first, permanently to enjoin the Goodmans from infringing Goodheart’s trademark; second, to have the Goodmans make a token payment of $1,000 to Goodheart; and third, to have the Goodmans pay costs to Good-heart, along with attorney’s fees in an amount to be determined, all conforming to, consistent with, and grounded on the reasons set forth in the opinion of the district court on the motion for preliminary injunction.
No elaborate explanation is necessary to tell us how the parties came to an agreement for the settlement of their trademark dispute. The path is apparent and began when the district court carefully considered the hearing testimony, examined the submissions of the parties on the preliminary injunction motion, and determined that “Goodheart has undeniably established a likelihood of confusion.” In arriving at that determination, the district court observed that “facts lead us to the conclusion that the defendants did not happen upon their marks serendipitously or by happenstance. Rather, they intentionally imitated Goodheart’s mark so as to capitalize on the latter’s reputation.” In short, the district court found the Goodmans guilty of the bad faith type of infringement that justifies the award of attorney’s fees. See Getty Petroleum Corp. v. Bartco Petroleum Corp., 858 F.2d 103, 114 (2d Cir.1988), cert. denied, 490 U.S. 1006, 109 S.Ct. 1642, 104 L.Ed.2d 158 (1989).
The district court’s opinion clearly spelled “curtains” for the Goodmans. Faced with the prospect of additional litigation expense, exposure to substantial damages and potential liability for the ongoing attorney’s fees incurred by Goodheart, the Goodmans folded their hand. Under the circumstances, it is inconceivable that the district court’s findings after trial would have been any different from its findings after the preliminary injunction hearing: that the Goodmans “intentionally imitated” the distinctive one-eyed heart trademark and that they did so for the purpose of capitalizing on the Goodheart reputation. The parties certainly did not believe that there would be a different outcome after trial. Otherwise, there would have been no offer of judgment and no acceptance, and the case would have gone to trial.
The reversal of the district court judgment subject of this appeal and the remand of this case for further proceedings will produce no different result. The bad faith of the Goodmans has been established to the satisfaction of the district court, and that finding will not change. The judgment entered upon the offer made under Rule 68 requires recognition of that finding in connection with the assessment of attorney’s fees, since the judgment provides, in specific terms of reference, that the permanent injunction granted therein is based upon the same findings as the preliminary injunction.
My colleagues say that the “in accordance with” language “should fairly be read to define the contours of the permanent injunction, which would simply continue as a permanent decree the preliminary injunction for which the Order provided.” At 273. I cannot agree. The “contours” of the permanent injunction are defined with detailed specificity, going so far as to identify the U.S. trademark registration number, the New York trademark registration number, and the sections of the Lanham Act and the New York General Business Law that were violated. It seems clear to me that there would be no need to include the phrase “in accordance with” if the intention of the parties was merely to define what was to be permanently enjoined.
While the offer and judgment refer to “attorneys fees, if any, awarded by the Court,” I do not believe that the emphasized words are meant to denote anything other than a recognition of the court’s discretionary authority to award fees, even *276where bad faith clearly is established. A district court abuses its discretion only if it fails to consider an award of attorney’s fees when bad faith, or, more properly, an “exceptional case” is identified. See Springs Mills, Inc. v. Ultracashmere House, Ltd., 724 F.2d 352, 357 (2d Cir.1983). The district court here accepted the comprehensive and well-reasoned report and recommendation of the Magistrate Judge and made an appropriate attorney’s fee award. The award was proper in all respects. See 15 U.S.C. § 1117(a).
Because my colleagues fail to fully recognize and effectuate the agreement of the parties in accordance with the unambiguous offer of judgment and acceptance in this case, see Whitaker v. Associated Credit Services, Inc., 946 F.2d 1222, 1226 (6th Cir.1991), and because that failure results in the improper rejection of the district court’s finding of bad faith infringement, and because that rejection leads to the inevitable (and, in my opinion, incorrect) conclusion that attorney’s fees were improperly allowed by the district court, I am constrained to register a respectful dissent.