Court Opinion

ID: 9472503
Source: CourtListenerOpinion
Date Created: 2023-08-05 04:02:48.750303+00
Date Added: 2024-06-11T17:42:59.116483
License: Public Domain

POSNER, Circuit Judge,
concurring.
Although I join Judge Pell’s majority opinion, I write separately to comment on his statement that a district judge's finding in a trademark or other intellectual-property case that the plaintiff was or was not guilty of laches is reversible only for a “clear abuse of discretion.” Many such cases in this and other circuits so state *936(sometimes without the “clear”). See, e.g., Blue Ribbon Feed Co. v. Farmers Union Central Exchange, Inc., 731 F.2d 415, 420 (7th Cir.1984); Baker Mfg. Co. v. Whitewater Mfg. Co., 430 F.2d 1008, 1009 (7th Cir. 1970); Boris v. Hamilton Mfg. Co., 253 F.2d 526, 528-29 (7th Cir.1958); Skippy, Inc. v. CPC Int'l, Inc., 674 F.2d 209, 212 (4th Cir.1982). But many others — again in this as well as other circuits — do not use the term “abuse of discretion,” and imply that a finding of laches will be reversed if clearly erroneous, or maybe if erroneous, period (the position urged in Weiner, The Civil Nonjury Trial and the Law-Fact Distinction, 55 Calif.L.Rev. 1020, 1045 (1967)). See, e.g., Money Store v. Harris-corp Finance, Inc., 689 F.2d 666, 674 (7th Cir.1982); Tisch Hotels, Inc. v. Americana Inn, Inc., 350 F.2d 609, 611, 614-15 (7th Cir.1965); Radio Shack Corp. v. Radio Shack, Inc., 180 F.2d 200, 206-07 (7th Cir. 1950); Carter-Wallace, Inc. v. Procter & Gamble Co., 434 F.2d 794, 803 (9th Cir. 1970); Frank Adam Electric Co. v. Federal Electric Products Co., 200 F.2d 210, 212 (8th Cir.1952). None of the cases in either group cites cases in the other group, and none explains why the standard of review should be abuse of discretion rather than clear (or mere) error, or vice versa. This insouciance about the standard of review need not connote irresponsibility; it may reflect a pragmatic recognition that the abuse-of-discretion standard is a zone rather than a point, see Friendly, Indiscretion About Discretion, 31 Emory L.J. 747, 764 (1982), and a zone that overlaps clear error in appropriate cases, cf. id. at 784 — of which laches, I submit, is one.
The clearly-erroneous standard of Fed.R. Civ.P. 52(a) that governs appellate review of the factfindings of federal trial judges is often, though not always, also the standard used to guide review of the judge’s application of substantive rules to facts of the who-did-what-to-whom variety. See, e.g., Noble v. Corporacion Insular de Seguros, 738 F.2d 51 at 53 (1st Cir. 1984); 9 Wright & Miller, Federal Practice and Procedure § 2589 (1971). For example, if a district judge found that the defendant in a personal-injury case had been negligent, this finding, like a finding that the defendant had been going 50 miles per hour, could be overturned on appeal only if clearly erroneous. See, e.g., Tucker v. Calmar S.S. Corp., 457 F.2d 440, 444 (4th Cir.1972); 9 Wright & Miller, supra, § 2590. Moreover, such disagreements as there are about the proper standard for reviewing determinations of “mixed questions of law and fact” — as such determinations are often called — are about whether they should be assimilated to factual or to legal determinations. See Bose Corp. v. Consumers Union, — U.S.-, 104 S.Ct. 1949, 1959-60, 80 L.Ed.2d 502 (1984); Pullman-Standard v. Swint, 456 U.S. 273, 289 and n. 19, 102 S.Ct. 1781, 1790 and n. 19, 72 L.Ed.2d 66 (1982); Nellis v. Brown County, 722 F.2d 853, 859-60 (7th Cir.1983); Lektro-Vend Corp. v. Vendo Co., 660 F.2d 255, 262 (7th Cir.1981). No one seems to think they should be treated as discretionary, and reviewed even more deferentially than pure factfindings.
Since the defense of laches is raised more often in intellectual-property cases, such as the trademark case before us, than in other types of case, it is relevant to note that clear error has been held to be the proper standard for reviewing determinations of most mixed questions of law and fact in intellectual-property cases — such questions as similarity (Original Appalachian Artworks, Inc. v. Toy Loft, Inc., 684 F.2d 821, 825 (11th Cir.1982); Williams v. Kaag Mfrs., Inc., 338 F.2d 949, 951 (9th Cir.1964)), copying (G.R. Leonard & Co. v. Stack, 386 F.2d 38 (7th Cir.1967)), access (Shurr v. Warner Bros. Pictures, Inc., 144 F.2d 200, 203 (2d Cir.1944)), and fair use (Eisenschiml v. Fawcett Publications, Inc., 246 F.2d 598, 604 (7th Cir.1957); MCA, Inc. v. Wilson, 677 F.2d 180, 183 (2d Cir.1981)), in copyright cases; likelihood of confusion in trademark cases (see, e.g., Hills Bros. Coffee, Inc. v. Hills Supermarkets, Inc., 428 F.2d 379, 380 (2d Cir.1970) (per curiam); Beatrice Foods Co. v. Neosho Valley Cooperative Creamery Ass ’n, *937297 F.2d 447, 449 (10th Cir.1961)); and unclean hands in patent cases (Kalo Inocu-lant Co. v. Funk Bros. Seed Co., 161 F.2d 981, 987 (7th Cir.1947), rev’d on other grounds, 333 U.S. 127, 68 S.Ct. 440, 92 L.Ed. 588 (1948)). Although some such questions, particularly in patent cases, are treated as questions of law rather than questions of fact (see, e.g., Dual Mfg. & Engineering, Inc. v. Burris Industries, Inc., 619 F.2d 660, 663, 667 (7th Cir.1980) (en banc) (obviousness in patent case)), none are treated as discretionary determinations.
The leading copyright treatise describes laches as “an issue of fact,” 3 Nimmer on Copyright § 12.06 at p. 12-55 (1983), but it would be more accurate to call it a mixed question of law and fact (and this whether it arises in a copyright or a trademark case), in order to distinguish it from such purely factual questions (requiring no knowledge of law to answer) as how fast the defendant was driving. A finding that a plaintiff’s claim against a trademark in-fringer is or is not barred by the plaintiff’s laches — that is, by “an inexcusable delay between the time a party could have sought relief in court and the time he actually does,” resulting in “prejudice” to the defendant, 1 Gilson, Trademark Protection and Practice § 8.12[12][a] (1984) — is like a finding that a defendant was or was not negligent, a conventional example of a mixed question of law and fact. Negligence is a-failure to take reasonable care, laches a failure to bring suit within a reasonable time; the standard of review should be the same.
Neither negligence nor laches is a discretionary determination. This term, if it is to be used functionally, should be confined to the class of rulings that do not fit easily into any of the following classes: legal rulings, as to which appellate review is plenary; factual determinations involving no admixture of a legal standard, as to which appellate review is governed by the clearly-erroneous standard (applied with “due regard” for the “opportunity of the trial court to judge of the credibility of the witnesses,” Fed.R.Civ.P. 52(a)); and rulings on mixed questions of law and fact, which sometimes are reviewed under the clearly-erroneous standard, sometimes receive plenary review, and sometimes are reviewed under an intermediate standard (see, e.g., Lektro-Vend Corp. v. Vendo Co., supra, 660 F.2d at 262-63). Like findings on credibility issues, discretionary rulings are rulings to which the appellate court gives especially great — sometimes virtually complete — deference. The court does this either because (as with credibility) the determination is one that is extremely difficult for an appellate court to evaluate, or because appellate review is relatively unimportant. Either or both of these criteria are satisfied in three closely related situations (see Mosey Mfg. Co. v. NLRB, 701 F.2d 610, 615 (7th Cir.1983) (en banc); cf. Noonan v. Cunard S.S. Co., 375 F.2d 69, 71 (2d Cir.1967) (Friendly, J.)):
1. The trial judge’s determination is not supposed to conform to a definite legal rule or standard that an appellate court might apply in reviewing the determination. Two examples are criminal sentencing and the management of pretrial discovery — the former requiring a uniquely individual judgment, see Williams v. New York, 337 U.S. 241, 247, 69 S.Ct. 1079, 1083, 93 L.Ed. 1337 (1949), the latter a managerial rather than legal judgment.
2. Whether an issue is decided uniformly doesn’t matter. The most important function of appellate review is to maintain the consistency of the law; if consistency is not a desideratum, the argument for appellate review is weakened. For example, if it is not thought important whether or not jurors are allowed to take notes during the trial, the question will be left to each judge, with minimal, maybe no, appellate review. This is much like the first situation (no standard), but there is a difference. The first situation deliberately leaves decision-making standardless, on the basis of a judgment that the appellate court ought not impose a standard — that the matter is better handled on a thoroughly individualized basis. In the second situation there need be no belief that the matter *938ought in principle be left to the trial judge’s discretion — just no sense of a need to lay down a uniform standard just yet.
3. The trial judge’s determination depends critically on information that is inaccessible to the appellate court through the medium of a transcript or other documents. Deciding whether closing argument, media publicity, threats, gruesome exhibits, or other forms of potentially prejudicial communication to a jury require that the verdict be set aside illustrates this category. The judge can observe the jurors’ reactions and therefore get a much better sense of the jury’s susceptibility to improper influence than an appellate court could do. See, e.g., United States v. Bruscino, 687 F.2d 938, 941 (7th Cir.1982) (en banc).
The determination of whether a plaintiff in a trademark case has been guilty of laches fits none of these categories. Lach-es is an important doctrine of trademark law, and unlike note-taking by jurors is as needful of uniform application as any other substantive doctrine of that law. The determination of laches is made on the record and is therefore accessible to informed appellate review; although credibility determinations may underlie a finding on laches, that is true of any issue. And unlike discovery and criminal sentencing, laches is not intended to be discretionary, that is, effectively standardless. The judge is supposed to balance the impact on the defendant of the plaintiff’s delay against the reasonableness of the plaintiff’s having waited as long as he did to sue and the strength of the plaintiff’s case. This is the same kind of analysis that a court must go through to decide whether the plaintiff or the defendant in a personal-injury case has failed to exercise due care, or whether the performing party in a breach of contract case delayed performance to the point where he can be said to have broken the contract. In all these cases the parties are entitled to have the district court’s determination set aside if clearly erroneous.
If it were true that laches “requires the delicate balancing of dozens of the competing factors which are present in the typical trademark case,” 1 Gilson, supra, § 8.12[12][b], at p. 8-117, this would be a strong argument for treating the determination of laches as discretionary. A standard that asks the district judge to consider a large number of factors (for example, the 17 factors of Sapper v. Lenco Blade, Inc., 704 F.2d 1069, 1073 (9th Cir.1983)) in no particular order and with no particular weighting of each factor is nondirective; it is effectively no standard. But the quoted passage is hyperbole. The author does not mention dozens of factors, or one dozen, or a half dozen. The factors he does discuss boil down to four: (1) strength of the plaintiff’s case, (2) length of and (3) reason for his delay in prosecuting it, and (4) extent of the defendant’s reliance on the delay by spending money to promote his own mark. See 1 Gilson, supra, § 8.12[12]. Professor McCarthy summarizes laches in even simpler terms: “Estoppel by laches = delay X prejudice.” 2 Trademarks and Unfair Competition 551, 565 (2d ed. 1984). See also Armco, Inc. v. Armco Burglar Alarm Co., 693 F.2d 1155, 1161 (5th Cir.1982). The issue is similar to whether a defendant should be estopped to plead the statute of limitations, Holmberg v. Armbrecht, 327 U.S. 392, 396-97, 66 S.Ct. 582, 584-585, 90 L.Ed. 743 (1946); and there is authority (though by no means overwhelming) for reviewing findings on equitable tolling under the clearly-erroneous standard. See Mayes v. Leipziger, 729 F.2d 605, 608 n. 2 (9th Cir.1984); Sperry v. Barggren, 523 F.2d 708, 710-11 (7th Cir.1975) (semble); but see Ohio v. Peterson, Lowry, Rall, Barber & Ross, 651 F.2d 687, 693 (10th Cir.1981). The ultimate criterion of laches, as of negligence, is reasonableness in the circumstances. Clark v. Volpe, 342 F.Supp. 1324, 1328 (E.D.1972), aff’d, 461 F.2d 1266 (5th Cir.1972) (per curiam).
If I am right that the determination of laches ought not be treated as a discretionary judgment of the trial court, then how has the “abuse of discretion” formulation become so entrenched? The answer seems to be historical; the phrase is a fossil of legal paleontology. “Laches,” from the *939Old French lasche (“lax”), originally was just a shorthand expression for the equity maxim that one who seeks the help of a court of equity must not sleep on his rights. See, e.g., Smith v. Clay, 3 Brown Ch. 646, 29 Eng.Rep. 743 (1767); 2 Pomer-oy, A Treatise on Equity Jurisprudence 169-81 (5th ed., Symons, 1941). (There is still a general equitable doctrine of laches, see 11 Wright & Miller, Federal Practice and Procedure § 2946 at pp. 417-22 (1973); I shall get to it in a moment.) Many equitable defenses were from the start used to bar legal as well as equitable relief (fraud as a defense to a claim for damages for breach of contract is an example). But laches came into play only if the plaintiff was seeking equitable relief.
The doctrine of laches in the law of intellectual property is descended from the original equity conception, see McLean v. Fleming, 96 U.S. 245, 24 L.Ed. 828 (1878); Menendez v. Holt, 128 U.S. 514, 523-24, 9 S.Ct. 143, 145, 32 L.Ed. 526 (1888) — that law being itself of equitable origin, see, e.g., Simpson, Fifty Years of American Equity, 50 Harv.L.Rev. 171, 184 (1936)— but it has followed a separate path. Where once it barred just equitable relief, today it is a substantive defense and bars legal relief as well — indeed, sometimes legal but not equitable relief, see 1 Gilson, supra, § 8.12[12][b], at p. 8-118. There is no reason why its equity origins and character should determine the scope of appellate review. A ruling that bars a plaintiff from all relief invites fuller appellate review than a determination that bars the plaintiff from just one form of relief.
Nor should we allow ourselves to be seduced by the following syllogism: laches is an equitable doctrine; equitable relief is discretionary; therefore the grant or denial of such relief can be reviewed only for abuse of discretion. The time when equity relief really was discretionary — a judgment committed to the conscience of the chancellor, see 1 Pomeroy, supra, at 73-75 — is past, cf. Fiss & Rendleman, Injunctions 104-08 (2d ed. 1984), the law of equity having long ago crystallized in a system of rules similar in basic character to the rules of the common law, though perhaps marginally more flexible. See the splendid discussion of the origins of equity in Maitland, Equity 1-22 (2d ed. rev. 1936); see also Baker, An Introduction to English Legal History 94-95 (2d ed. 1979); 3 Blackstone, Commentaries on the Laws of England 432, 434 (1768); 5 Holdsworth, A History of English Law 217 (2d ed. 1937); 1 Pomeroy, supra, at 75-78. (But what could be more flexible than the concept of “due care” which underlies negligence law?) One does not get an injunction any more by appealing to a district judge’s “discretion,” but by showing a right to an injunction. And one does not defend against an injunction by asking the judge to find laches as a matter of conscience but by persuading him that the elements of the defense are present. As the application of the doctrine is not a matter of discretion, its misapplication is not aptly described by the words “abuse of discretion.”
Moreover, paralleling the merger of legal and equitable procedure (as in Rules 1 and 2 of the Federal Rules of Civil Procedure), equity as a body of substantive principles has become virtually indistinguishable from law; equity doctrines (fraud, laches, estoppel, many others) have become legal doctrines. See, e.g., Dobbs, Handbook on the Law of Remedies 34-35 (1973). As there is no longer any sound general reason for reviewing equity determinations under a more restrictive standard than legal determinations, it is no surprise that the standards of review for legal and equitable determinations have converged. See, e.g., King v. Stevenson, 445 F.2d 565, 571 (7th Cir.1971); Federal Savings & Loan Ins. Corp. v. Cook, 419 F.2d 1296 (7th Cir.1969); Shapiro v. Rubens, 166 F.2d 659, 666 (7th Cir.1948); Breeland v. Hide-A-Way Lake, Inc., 585 F.2d 716, 722 (5th Cir.1978), modified on other grounds, 593 F.2d 22 (5th Cir.1979) (per curiam); Magna-leasing, Inc. v. Staten Island Mall, 563 F.2d 567, 569 (2d Cir.1977) (per curiam). Laches should be no exception.
The history of appeals in equity supplies an additional clue to the origins of the term *940“abuse of discretion” in laches cases. In the heyday of English equity jurisprudence the whole equity power was vested in the Lord Chancellor of England. Equity decrees were issued by his subordinates but he could revise them at will. See 3 Blackstone, supra, at 453-54. Appellate power, if it could properly be called that, thus was plenary; but until the seventeenth century there was no appeal from the Lord Chancellor himself. See Crick, The Final Judgment as a Basis for Appeal, 41 Yale L.J. 539, 547 (1932). Colonial America had, instead of the Lord Chancellor, equity courts; and it was the judges of those courts (including after 1789 federal judges, who from the first were equity as well as law judges) who administered the equity jurisdiction in succession as it were to the Lord Chancellor. See Katz, The Politics of Law in Colonial America: Controversies Over Chancery Courts and Equity Law in the Eighteenth Century, in 5 Perspectives in American History 257, 262-82 (Fleming & Bailyn eds. 1971); Judiciary Act of 1789, § 11, 1 Stat. 78. (My little historical sketch, I should warn the reader, is oversimplified. See materials in Kimball, Historical Introduction to the Legal System 304-08 (1966).) It was natural therefore to conceive of the scope of appellate review of equity decrees as highly limited; and it was thus, one may conjecture, that abuse of discretion became the recognized standard for reviewing such decrees. See, e.g., 2 High, A Treatise on the Law of Injunctions § 1696 (4th ed. 1905). And yet despite this, review of factfindings was always more liberal in equity than in law, because of the absence of a jury and the traditionally heavy reliance in equity proceedings on documentary evidence. See Lundgren v. Freeman, 307 F.2d 104, 113-14 (9th Cir. 1962). The clearly-erroneous standard of Rule 52(a) is the old equity standard. United States v. United States Gypsum Co., 333 U.S. 364, 394-95, 68 S.Ct. 525, 541-542, 92 L.Ed. 746 (1948); Lundgren v. Freeman, supra, 307 F.2d at 113-14; 5A Moore’s Federal Practice 11 52.03[1] at p. 52-14 (2d ed. 1984). So why give that standard — a standard commonly applied as we have seen to mixed questions of law and fact as well as pure questions of law— less scope in equity than in law cases?
All this makes quite puzzling not only the cases that hold that the proper standard for reviewing determinations of laches in intellectual-property cases is abuse of discretion but also the eases that describe determinations of laches in other areas as discretionary, see, e.g., Burnett v. New York Central R.R., 380 U.S. 424, 435, 85 S.Ct. 1050, 1058, 13 L.Ed.2d 941 (1965); Gardner v. Panama R.R., 342 U.S. 29, 30-31, 72 S.Ct. 12,13-14, 96 L.Ed. 31 (1951) (per curiam), and therefore subject to review under the abuse of discretion standard, see, e.g., Albemarle Paper Co. v. Moody, 422 U.S. 405, 423-24, 95 S.Ct. 2362, 2374-2375, 45 L.Ed.2d 280 (1975); Lingenfelter v. Keystone Consolidated Industries, Inc., 691 F.2d 339, 340-41 (7th Cir. 1982) (per curiam); EEOC v. Massey-Ferguson, Inc., 622 F.2d 271, 275-76 (7th Cir. 1980), even when laches pops up well outside the normal bounds of equity jurisprudence, as in United States v. Darnell, 716 F.2d 479-80 (7th Cir.1983) (per curiam) (cor-am nobis as post-conviction remedy). But as I said earlier, abuse of discretion is a portmanteau concept that includes clear error as a special case; and it is unlikely that any of the cases I have cited would have been decided differently if the more precise and informative formula had been used. Nor has the abuse of discretion formula swept the board entirely; for just as in the intellectual-property area, many cases in other areas of the law where laches is raised as a defense review determinations of laches explicitly under the clearly-erroneous standard. See, e.g., Allegheny Airlines, Inc. v. Forth Corp., 663 F.2d 751, 757-58 (7th Cir.1981); Congress Financial Corp. v. J-K Coin Op Equipment Co., 353 F.2d 683, 686 (7th Cir.1965); Central Ry. Signal Co. v. Longden, 194 F.2d 310, 317-18, 320-21 (7th Cir.1952); New Mexico District Council of Carpenters v. Mayhew Co., 664 F.2d 215, 218 (10th Cir.1981); Tagaropulos, S.A. v. S.S. Santa Paula, 502 F.2d 1171 (9th Cir.1974); Esso Int'l, Inc. v. *941SS Captain John, 443 F.2d 1144, 1150 (5th Cir.1971).
Regarding the present case, however, I am happy to say that I have no quarrel with the majority’s analysis, as distinct from its label. It recognizes that the lach-es issue is “highly fact-based,” and it reviews the district judge’s factual determination, including his ultimate determination that the defendant had not shown laches, as it would any other determination reviewable under the clearly-erroneous standard. I simply would prefer to see us discard, as an obfuscating anachronism, the term “abuse of discretion” to describe the standard for appellate review of determinations of laches — especially in intellectual-property cases.