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Internet Trademark Case Summaries

Panda Herbal Int'l v. Luby

2007 WL 44023 (E.D. Pa. Jan. 9, 2007)

Plaintiff developed, manufactured, and sold herbal, wellness, and dietary supplements, aromatherapy products, and health support aids under the registered mark TURNING POINT and numerous other marks.  Plaintiff hired defendants to develop an Internet presence, including registration of 12 domain names: "," "," "," "," "," "," "," "," "," "," "," and ""  Defendants assumed more and more responsibility in plaintiff's business and, in 2001, agreed with plaintiff to take over day-to-day operations of the business on a trial basis.  In 2005, plaintiff discovered that defendant had established a separate business entity and had taken possession of some of plaintiff's inventory, equipment, and customer information and used it to compete against plaintiff by selling similar herbal supplements as well as plaintiff's products.  Plaintiff sued for trademark infringement, unfair competition, dilution, cybersquatting, and counterfeiting.  After a seven-day jury trial on the infringement and cybersquatting claims, the jury returned a verdict in favor of plaintiffs.  The jury found that defendants infringed two registered trademarks, thirty-one unregistered marks, and three logos.  The jury also held that plaintiff violated the ACPA regarding the 12 domain names listed above.  The jury awarded $200,000 in damages for infringement.  Before trial ended, plaintiff advised the court that it would seek statutory damages under the ACPA.  The court directed the magistrate judge to rule on plaintiff's requests for injunctive relief and ACPA statutory damages.  The magistrate judge first recommended granting plaintiff a permanent injunction.  In light of the jury's verdict, to not enjoin defendant would "essentially eviscerate the jury's conclusion."  The magistrate judge recommended an injunction prohibiting defendants from using or registering the disputed trademarks or any confusingly similar marks.  But it did narrow plaintiff's requested injunction to delete "or part thereof" because it would preclude defendants from using terms like "herbal."  Regarding statutory damages under the ACPA, the magistrate judge held that there was no evidence that defendants actually used eleven of the twelve domain names in its business and awarded "only $1,000" for each of these names.  However, the last domain name, "," was the "mainstay" of defendants' business.  Nonetheless, describing this case as "more akin to a business dispute rather than an infringement case," the magistrate judge held that "justice does not require a significant award" and that $5,000 was "just."  The magistrate next declined to award attorney's fees because this case was not "exceptional" according to the ACPA.  This was "not a case of a cybersquatter whose business is registering and hoarding domain names for profit," but rather was a "business dispute between former friends."  The magistrate judge also ordered defendants to "take down" and "disable" all of the websites and any links between the domain names and defendants' websites, and to transfer the 12 domain names to plaintiff.