Planetary Motion, Inc. v. Techsplosion, Inc.

[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS
FILED
FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
AUGUST 16, 2001
________________
THOMAS K. KAHN
CLERK
No. 00-10872
________________
D.C. Docket No. 99-6511-CIV-DTKH

PLANETARY MOTION, INC.,
Plaintiff-Counter-
Defendant-Appellee,

versus

TECHPLOSION, INC.,
MICHAEL GAY a.k.a.
Michael Carson,
Defendants-Counter-
Claimants-Appellants.

________________

Appeal from the United States District Court
for the Southern District of Florida
________________

(August 16, 2001)

Before TJOFLAT and WILSON, Circuit Judges, and RESTANI*, Judge.

*
Honorable Jane A. Restani, Judge, United States Court of International Trade, sitting by
designation.
RESTANI, Judge:

Planetary Motion, Inc. (“Planetary Motion” or “Appellee”) sued

Techsplosion, Inc. and Michael Gay a/k/a Michael Carson (respectively

“Techsplosion” and “Carson”; collectively “Appellants”) for infringement and

dilution of an unregistered trademark under Section 43(a) and (c) of the Federal

Trademark Act, 15 U.S.C. § 1051 et seq. (1994) (“Lanham Act”), and for violation

of Florida’s unfair competition law. Fla. Stat. Ann. § 495.151 (West 2000).

Finding that Planetary Motion had established priority of use and a likelihood of

confusion, the United States District Court for the Southern District of Florida

entered summary judgment in favor of Planetary Motion. We affirm the judgment

and vacate the award of attorney fees.

Facts

I. Development and Distribution of the “Coolmail” Software

In late 1994, Byron Darrah (“Darrah”) developed a UNIX-based program

(the “Software”) that provides e-mail users with notice of new e-mail and serves as

a gateway to the users’ e-mail application. On December 31, 1994, Darrah

distributed the Software over the Internet by posting it on a UNIX user site called

“Sunsite,” from which it could be downloaded for free. Darrah had named the

2
Software “Coolmail” and this designation appeared on the announcement sent to

the end-users on Sunsite as well as on the Software user-manual, both of which

accompanied the release.

The Software was distributed without charge to users pursuant to a GNU

General Public License that also accompanied the release. A GNU General Public

License allows users to copy, distribute and/or modify the Software under certain

restrictions, e.g., users modifying licensed files must carry “prominent notices”

stating that the user changed the files and the date of any change. After the release

of the Software, Darrah received correspondence from users referencing the

“Coolmail” mark and in some cases suggesting improvements. In 1995, Darrah

released two subsequent versions of the Software under the same mark and also

pursuant to the GNU General Public License.

In early 1995, a German company named S.u.S.E. GmbH sought permission

from Darrah to include the Software in a CD-ROM package sold as a compilation

of Unix-based programs. Darrah consented and, pursuant to the GNU licensing

agreement, S.u.S.E. distributed the Software in its compilation product and in

subsequent versions thereof. S.u.S.E. sold and continues to sell the software

compilation in stores in the United States and abroad, as well as over the Internet.

II. Launch of Techsplosion’s “CoolMail” E-mail Service

3
 In 1998, Appellant Carson formed Techsplosion, for the purpose of

operating a business based on an e-mail service that he had developed. On April

16, 1998, Techsplosion began offering the e-mail service on the Internet under the

mark “CoolMail.” Two days later, Techsplosion activated the domain name

“coolmail.to” Techsplosion delivered an e-mail solicitation under the “CoolMail”

mark to approximately 11,000 members of the Paramount Banner Network, an

Internet advertising network, also created and operated by Carson. Techsplosion

charged no fee to subscribe to the service and generated revenues through the sale

of banner advertisements on its web site.

III. Planetary Motion’s E-mail Service & Application for Trademark

Registration

Appellee Planetary Motion is a computer software and telecommunications

company that developed and owns an electronic mail service called “Coolmail.”

As part of its service, Planetary Motion enables a person to check e-mail via

telephone without logging onto a computer. On April 24, 1998, Planetary Motion

filed three intent-to-use applications to register the mark “Coolmail” with the

United States Patent and Trademark Office. Though Planetary Motion was aware

that Darrah’s Software also bore the mark “Coolmail,” it represented in its

applications that it was not aware of any mark upon which its proposed registered

4
mark would infringe. Planetary Motion launched its Coolmail e-mail service to

subscribers on June 8, 1998.

IV. Planetary Motion’s Complaint and Subsequent Acquisition of Darrah’s

Rights

On April 22, 1999, Planetary Motion filed a complaint against Techsplosion.

In the complaint, Planetary Motion alleged infringement of the alleged mark

“Coolmail” for use in connection with e-mail services. Planetary alleged federal

trademark infringement and unfair competition under Section 43(a) of the Lanham

Act, 15 U.S.C. § 1125(a), as well as injury to business reputation and dilution

under Florida Statute § 495.151.

On June 10, 1999, Techsplosion filed an Answer, Affirmative Defenses, and

Counterclaims. The counterclaims alleged infringement of the mark “Coolmail”

for use in connection with e-mail services. Techsplosion alleged unfair

competition, false designation, description, and representation under the Lanham

Act, common trademark infringement, common law unfair competition, and injury

to business reputation and dilution.

In July of 1999, Planetary Motion purchased from Darrah all rights, title, and

interest to the Software including all copyrights, trademarks, patents and other

5
intellectual property rights.1 On August 31, 1999, Planetary filed an Amended

Verified Complaint, adding a claim for dilution under Section 43(c) of the Lanham

Act, 15 U.S.C. § 1125(c), and alleging violation of trademark rights assigned from

Darrah.

V. Disposition of Planetary Motion’s Complaint

On January 31, 2000, the district court entered an Order granting Planetary

Motion’s motion for summary judgment and denying Carson’s and Techsplosion’s

motion for summary judgment. The district court based the Order on two findings:

(1) that the alleged mark was affixed to Darrah’s software, and that Darrah’s

distribution of the software over the Internet constituted a “transport in commerce,”

resulting in the creation of trademark rights and priority, and (2) there was a

likelihood of confusion because the marks “are essentially the same.” The district

court did not reach the issue of whether Techsplosion’s use of “CoolMail” in

connection with its e-mail service diluted Planetary Motion’s mark.

On the same date, the district court entered final judgment granting Planetary

Motion permanent injunctive relief. See 15 U.S.C. § 1116. The order also

1
The assignee of a trade name or service mark “steps into the shoes of the assignor.” Premier
Dental Prods. Co. v. Darby Dental Supply Co., 794 F.2d 850, 853 (3d Cir.), cert. denied, 479
U.S. 950 (1986). Appellants do not contest the validity of the assignment from Darrah, nor do
they dispute that in purchasing rights to Darrah’s software, Planetary Motion succeeded to all
rights possessed by Darrah.

6
awarded Planetary Motion profits and damages, as well as attorney fees and costs,

pursuant to section 35 of the Lanham Act, 15 U.S.C. § 1117. The district court

requested a report and recommendation from a magistrate judge fixing the amounts

to be awarded.

A Notice of Appeal was filed on February 15, 2000. On February 15, 2000,

Techsplosion filed an Emergency Motion to Stay Pending Appeal, reasserting that

Darrah never established any rights in the alleged mark. This motion was denied

on February 17, 2000.

On May 9, 2000 the magistrate judge entered his report recommending that

Planetary Motion be awarded $275,508 in attorneys’ fees and $6,562.34 in costs,

but that its request for damages be denied for lack of specificity. Techsplosion

served its appeal brief on May 22, 2000. On June 9, 2000, the district court entered

an order adopting the report and recommendation in its entirety. On July 7, 2000,

Techsplosion filed a Notice of Appeal from the order adopting the magistrate

judge’s report and recommendation.2

Standard of Review

2
Planetary Motion does not appeal the district court’s adoption of the recommendation of the
magistrate judge denying damages.

7
 Review of a district court’s grant of summary judgment is de novo, with all

facts and reasonable inferences therefrom reviewed in the light most favorable to

the non-moving party. Carnival Brand Seafood Co. v. Carnival Brands, Inc., 187

F.3d 1307, 1309 (11th Cir. 1999).

Discussion

Section 43(a) of the Lanham Act forbids unfair trade practices involving

infringement of trade dress, service marks, or trademarks, even in the absence of

federal trademark registration.3 Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S.

763, 768 (1992). Section 43(a) is remedial in nature and should be interpreted and

applied broadly so as to effectuate its remedial purpose. Montgomery v. Noga, 168

F.3d 1282, 1300 & n. 29 (11th Cir. 1999) (citing Warner Bros., Inc. v. Gay Toys,

3
Section 43(a) provides in pertinent part:
(1) Any person who, on or in connection with any goods or services, or any
container for goods, uses in commerce any word, term, name, symbol, or device,
or any combination thereof, or any false designation of origin, false or misleading
description of fact, or false or misleading representation of fact, which--
(A) is likely to cause confusion, or to cause mistake, or to deceive as to the
affiliation, connection, or association of such person with another person, or as to
the origin, sponsorship, or approval of his or her goods, services, or commercial
activities by another person, or
(B) in commercial advertising or promotion, misrepresents the nature,
characteristics, qualities, or geographic origin of his or her or another person’s
goods, services, or commercial activities,
shall be liable in a civil action by any person who believes that he or she is or is
likely to be damaged by such act.

15 U.S.C. § 1125(a).

8
Inc., 658 F.2d 76, 79 (2d Cir. 1981)). To prevail under this section, a claimant

must show (1) that it had prior rights to the mark at issue and (2) that the defendant

had adopted a mark or name that was the same, or confusingly similar to its mark,

such that consumers were likely to confuse the two.4 Lone Star Steakhouse &

Saloon, Inc. v. Longhorn Steaks, Inc., 106 F.3d 355, 360 (11th Cir. 1997) (citing

Conagra Inc. v. Singleton, 743 F.2d 1508, 1512 (11th Cir. 1984)), modified, 122

F.3d 1379 (1997). Appellants argue that the district court erred in finding that

Planetary Motion had established both elements. Appellants also dispute the

scope of injunctive relief, as well as the award of attorney fees and costs.

I. Prior Use in Commerce

Under common law, trademark ownership rights are “appropriated only

through actual prior use in commerce.” Tally-Ho, Inc. v. Coast Cmty College

Dist., 889 F.2d 1018, 1022 (11th Cir. 1989) (citation omitted). Under the Lanham

Act,5 the term “use in commerce” is defined in relevant part as follows:

4
Courts may use an analysis of federal infringement claims as a “measuring stick” in evaluating
the merits of state law claims of unfair competition. See Investacorp, Inc. v. Arabian Inv.
Banking Corp. (Investcorp) E.C., 931 F.2d 1519, 1521 (11th Cir.), cert. denied, 502 U.S. 1005
(1991).
5
“In the absence of registration, rights to a mark traditionally have depended on the very same
elements that are now included in the statutory definition: the bona fide use of a mark in
commerce that was not made merely to reserve a mark for later exploitation.” Allard Enters.,
Inc. v. Advanced Programming Res., Inc., 146 F.3d 350, 357 (6th Cir. 1998). Common law and
statutory trademark infringements are merely specific aspects of unfair competition. New West
(continued...)

9
 the bona fide use of a mark in the ordinary course of trade, and not
made merely to reserve a right in a mark. . . . [A] mark shall be
deemed to be in use in commerce . . . on goods when (A) it is placed
in any manner on the goods or their containers or the displays
associated therewith or on the tags or labels affixed thereto, or if the
nature of the goods makes such placement impracticable, then on
documents associated with the goods or their sale, and (B) the goods
are sold or transported in commerce . . . .

15 U.S.C. § 1127.6 The district court found that because the statute is written in

the disjunctive (i.e., “sale or transport”), Darrah’s wide distribution of the Coolmail

software over the Internet, even absent any sales thereof, was sufficient to establish

ownership rights in the “CoolMail” mark. Appellants contend that “transport in

commerce” alone -- here, Darrah’s free distribution of software over the Internet

“with no existing business, no intent to form a business, and no sale under the

5
(...continued)
Corp. v. NYM Co. of Cal., Inc., 595 F.2d 1194, 1201 (9th Cir. 1979) (citing, inter alia, Dresser
Indus., Inc. v. Heraeus Engelhard Vacuum, Inc., 395 F.2d 457, 461 (3d Cir.), cert. denied, 393
U.S. 934 (1968)).
6
Appellants appear to have conceded that if Darrah sent out original programs and related
manuals, this would satisfy the affixation requirement:
MR. GIGLIOTTI [counsel for Techsplosion]: [The mark] has to be on
the product or on the associated documentation. It is on neither.
THE COURT: It is not on the associated documentation[?] How about the
original programs Darrah sent out and manuals that went with it, and all that
material, wasn’t that enough for affixation?
MR. GIGLIOTTI: Yes, Your Honor, that is affixation; however, he did
not meet the sale requirement.
R3-85-19 to 20.
In any case, the affixation requirement is met because the Software was distributed under
a filename that is also the claimed mark, was promoted under the same mark, was accompanied
by a user manual bearing the mark, and was sold in a compilation under the mark.

10
mark” -- is insufficient to create trademark rights. Appellants’ Brief at 13.

Appellants’ argument lacks merit.

The parties do not make clear the two different contexts in which the phrase

“use in commerce” is used. The term “use in commerce” as used in the Lanham

Act “denotes Congress’s authority under the Commerce Clause rather than an

intent to limit the [Lanham] Act’s application to profit making activity.” United

We Stand Am., Inc. v. United We Stand, Am. N.Y., Inc., 128 F.3d 86, 92-93 (2d

Cir. 1997) (citation omitted), cert. denied, 523 U.S. 1076 (1998); U.S. Const., Art.

I, § 8, cl. 3. Because Congress’s authority under the Commerce Clause extends to

activity that “substantially affects” interstate commerce, United States v. Lopez,

514 U.S. 549, 559 (1995), the Lanham Act’s definition of “commerce” is

concomitantly broad in scope: “all commerce which may lawfully be regulated by

Congress.” 15 U.S.C. § 1127. See also Steele v. Bulova Watch Co., 344 U.S. 280,

283-84 (1952); Larry Harmon Pictures Corp. v. Williams Rest. Corp., 929 F.2d

662, 666 (Fed. Cir.) (allowing registration for an intrastate provider of restaurant

services with an undefined interstate clientele), cert. denied, 502 U.S. 823 (1991).

The distribution of the Software for end-users over the Internet satisfies the “use in

commerce” jurisdictional predicate. See, e.g., Planned Parenthood Fed’n of Am.,

Inc. v. Bucci, 42 U.S.P.Q.2d 1430, 1434 (S.D.N.Y. 1997) (“The nature of the

11
Internet indicates that establishing a typical home page on the Internet, for access

to all users, would satisfy the Lanham Act’s ‘in commerce’ requirement.”), aff’d,

152 F.3d 920 (2d Cir.), cert. denied, 525 U.S. 834 (1998).

Nevertheless, the use of a mark in commerce also must be sufficient to

establish ownership rights for a plaintiff to recover against subsequent users under

section 43(a). See New England Duplicating Co. v. Mendes, 190 F.2d 415, 417-18

(1st Cir. 1951) (after finding “use in commerce” jurisdiction predicate satisfied,

court noted that “[t]he question remains whether the plaintiff has established that

he was the ‘owner’ of the mark, for under [15 U.S.C. § 1051] only the ‘owner’ of a

mark is entitled to have it registered.”). The court in Mendes set forth a two part

test to determine whether a party has established "prior use" of a mark sufficient to

establish ownership:

[E]vidence showing, first, adoption,7 and, second, use in a way
sufficiently public to identify or distinguish the marked goods in an
appropriate segment of the public mind as those of the adopter of the
mark, is competent to establish ownership, even without evidence of
actual sales.8

7
It is uncontested that Darrah adopted the mark “Coolmail” before Appellants’ use of the
mark in connection with their e-mail service.
8
This ownership test is not for the purpose of establishing the “use in commerce”
jurisdictional predicate of the Lanham Act. See, e.g., Univ. of Fla. v. KPB, Inc., 89 F.3d 773,
776 n.4 (11th Cir. 1996). See supra discussion in text.

12
Id. at 418. See also New West, 595 F.2d at 1200.9

Courts generally must inquire into the activities surrounding the prior use of

the mark to determine whether such an association or notice is present. See, e.g.,

Johnny Blastoff, Inc. v. L.A. Rams Football Co., 188 F.3d 427, 433 (7th Cir.

1999) (“The determination of whether a party has established protectable rights in

a trademark is made on a case by case basis, considering the totality of the

circumstances.”), cert. denied, 528 U.S. 1188 (2000). Under the “totality of

circumstances” analysis, a party may establish “use in commerce” even in the

absence of sales. “[A]lthough evidence of sales is highly persuasive, the question

of use adequate to establish appropriation remains one to be decided on the facts of

each case . . . .” New West, 595 F.2d at 1200 (quoting Mendes, 190 F.2d at 418).

The court in New West recognized that “mere advertising by itself may not

establish priority of use,” but found that promotional mailings coupled with

advertiser and distributor solicitations met the Mendes “public identification”

9
This ownership requirement parallels the statutory definition of “trademark”: “any word,
name, symbol, or device, or any combination thereof . . . used by a person . . . to identify and
distinguish his or her goods . . . from those manufactured or sold by others . . . .” 15 U.S.C. §
1127. The Seventh Circuit has held that a higher quantum of use may be necessary to establish
ownership rights under common law than under the statute because the notice function of
registration is lacking. See Zazu Designs v. L’Oreal, S.A., 979 F.2d 499, 503-04 (7th Cir. 1992).
In addition, the continuity of a user’s commercial activities in connection with the mark is also
relevant to determining whether use is sufficient to establish common law ownership. Circuit
City Stores, Inc. v. CarMax, Inc., 165 F.3d 1047, 1054-55 (6th Cir. 1999) (“A party establishes a
common law right to a trademark only by demonstrating that its use of the mark was ‘deliberate
and continuous, not sporadic, casual or transitory.’”).

13
ownership requirement. Id. at 1200. Thus, contrary to Appellants’ assertions, the

existence of sales or lack thereof does not by itself determine whether a user of a

mark has established ownership rights therein.10 Compare Marvel Comics Ltd. v.

Defiant, 837 F. Supp. 546, 549 (S.D.N.Y. 1993) (finding announcement of

"Plasmer" title to 13 million comic book readers and promotion at annual trade

convention sufficient to establish trademark ownership rights, notwithstanding lack

of any sales) with Warnervision Entm’t Inc. v. Empire of Carolina Inc., 915 F.

Supp. 639, 645-46 (S.D.N.Y.) (finding toy manufacturer’s promotional efforts

insufficient to establish priority of use where only a few presentations were made

to industry buyers, even though one resulted in a sale to a major toy retailer), aff’d

in part, vacated in part, 101 F.3d 259 (2d Cir. 1996).11

10
Appellants cite Future Domain Corp. v. Trantor Sys. Ltd., 27 U.S.P.Q.2d 1289, 1293
(N.D.Cal.1993) for the proposition that there must be a sale in order to satisfy the “use in
commerce” requirement. Future Domain, however, turned not on the existence of sales but
whether the extent of the purported mark owner’s activities created a public association between
the mark and the product. There, the court determined that a computer software manufacturer's
promotion of a mark at a trade show -- where at most 7,000 persons actually received or
requested information about the mark and where no orders were taken -- was not sufficient to
create such an association. Id. at 1293-95.
11
Courts applying the “totality of circumstances” approach routinely have found evidence of a
few sales of goods to which the mark had been affixed insufficient to establish trademark
ownership. For example, in Zazu Designs, 979 F.2d at 503-04, the plaintiff hair salon had sold a
few bottles of shampoo bearing the mark “Zazu” both over the counter and mailed over state
lines. The court found that such limited sales “neither link the Zazu mark with [the plaintiff’s]
product in the minds of consumers nor put other producers on notice.” Id. at 503

14
 Similarly, not every transport of a good is sufficient to establish ownership

rights in a mark. To warrant protection, use of a mark “need not have gained wide

public recognition,” but “[s]ecret, undisclosed internal shipments are generally

inadequate.” Blue Bell, Inc. v. Farah Mfg. Co., 508 F.2d 1260, 1265 (5th Cir.

1975).12 In general, uses that are de minimis may not establish trademark

ownership rights. See, e.g., Paramount Pictures Corp. v. White, 31 U.S.P.Q.2d

1768, 1772-73 (Trademark Tr. & App. Bd. 1994) (finding no bona fide use in

ordinary course of trade where mark was affixed to a game consisting of three

pieces of paper and distributed for the purpose of promoting musical group).

We find that, under these principles, Darrah’s activities under the

“Coolmail” mark constitute a “use in commerce” sufficiently public to create

ownership rights in the mark. First, the distribution was widespread, and there is

evidence that members of the targeted public actually associated the mark

Coolmail with the Software to which it was affixed. Darrah made the software

available not merely to a discrete or select group (such as friends and

acquaintances, or at a trade show with limited attendance), but to numerous end-

users via the Internet. The Software was posted under a filename bearing the

12
In Bonner v. City of Prichard, 661 F.2d 1206 (11th Cir. 1981) (en banc), the Eleventh Circuit
adopted as binding precedent all decisions handed down by the former Fifth Circuit prior to
October 1, 1981.

15
“Coolmail” mark on a site accessible to anyone who had access to the Internet.

End-users communicated with Darrah regarding the Software by referencing the

“Coolmail” mark in their e-mails. Appellants argue that only technically-skilled

UNIX-users made use of the Software, but there is no evidence that they were so

few in number to warrant a finding of de minimis use.

Third, the mark served to identify the source of the Software. The

“Coolmail” mark appeared in the subject field and in the text of the announcement

accompanying each release of the Software, thereby distinguishing the Software

from other programs that might perform similar functions available on the Internet

or sold in software compilations.13 The announcements also apparently indicated

that Darrah was the “Author/Maintainer of Coolmail” and included his e-mail

address. The user manual also indicated that the Software was named

“Coolmail.”14 The German company S.u.S.E. was able to locate Darrah in order to

13
Darrah testified that “[m]ost of the source files . . . have [the mark] in them. Also there’s a
copyright notice included with the software that has the name Coolmail. And the name of the
executable file itself is Coolmail.”

R2-47-Exh. 3 at 67.
14
Darrah: The Coolmail name always comes with the documentation that comes with the
software.
* * *
Q: What documentation are you talking about?
A: There’s a user manual that comes with it.
* * *
(continued...)

16
request permission to use his Software in its product under the mark “Coolmail.”

Appellants do not assert that S.u.S.E. was unaware that the Software was called

“Coolmail” when it contacted Darrah.

Fourth, other potential users of the mark had notice that the mark was in use

in connection with Darrah’s Software. In investigating whether the mark Coolmail

existed before submitting its trademark registration application for its e-mail

service, Planetary Motion was able to discover that Darrah was using the mark to

designate his Software product.

Fifth, the Software was incorporated into several versions of a product that

was in fact sold worldwide and specifically attributed ownership of the Software to

Darrah under the “Coolmail” mark. Any individual using the S.u.S.E. product, or

competitor of S.u.S.E., that wanted to know the source of the program that

performed the e-mail notification function, could do so by referring to the user

14
(...continued)
Q: Does it say “Coolmail” on page 1?
A. Yes.
Q: Where does it say “Coolmail” on page 1?
A: At the top.
... and on the header of every page.
Q: What does it say, exactly?
A: I’m not sure if it says this verbatim, it’s “Coolmail,” space, then the version number.

R2-47-Exh. 3 at 68, 72 to 73.

17
manual accompanying the product.15 There is no support for the argument that for

a trademark in software to be valid, the mark must appear on the box containing

the product incorporating it, that the mark must be displayed on the screen when

the program is running, or that the software bearing the mark be a selling point for

the product into which it is incorporated. There is no requirement that the public

come to associate a mark with a product in any particular way or that the public be

passive viewers of a mark for a sufficient public association to arise.

Sixth, software is commonly distributed without charge under a GNU

General Public License. The sufficiency of use should be determined according to

the customary practices of a particular industry. See S. Rep. 100-515 at 44 (1988)

(“The committee intends that the revised definition of ‘use in commerce’ [see note

13, supra] be interpreted to mean commercial use which is typical in a particular

industry.”) (emphasis added). That the Software had been distributed pursuant to a

15
The user manual for the S.u.S.E. Linux 4.3 product includes a list of application packages
that contains the following attribution:
coolmail “Cool” XBiff Clone
Shows if new mail has arrived. The main advantage of this program is that you can click
into the window to fire up the mailer of your choice.
Docu: man coolmail
Copyright: (c) 1994 Byron C. Darrah
Author: Byron C. Darrah , Randall K. Sharpe

Version: 1.3

Supp. Exh. 1 at 14-72 and 42-110.

18
GNU General Public License does not defeat trademark ownership, nor does this in

any way compel a finding that Darrah abandoned his rights in trademark.

Appellants misconstrue the function of a GNU General Public License. Software

distributed pursuant to such a license is not necessarily ceded to the public domain

and the licensor purports to retain ownership rights, which may or may not include

rights to a mark.16

Appellants cite Heinemann v. General Motors Corp., 342 F. Supp. 203 (N.D.

Ill. 1972), aff’d, 478 F.2d 1405 (7th Cir. 1973), for the proposition that Darrah was

a “hobbyist” unworthy of common law trademark protection. Heinemann is

factually distinguishable from the case at hand. The plaintiff in Heinemann used a

mark in connection with his automobile before an automobile manufacturer

independently had adopted the same name for a new model. The court held that

the plaintiff had not established common law ownership rights based on two

findings. First, the court found that because Heinemann’s purpose in using the

mark was to “open [at a later date] an automobile equipment shop which would

have capitalized upon the slogan,” he merely attempted to “reserve a trade or

service mark pending the creation of a trade or business . . . .” 342 F. Supp. at 207.

16
Because a GNU General Public License requires licensees who wish to copy, distribute, or
modify the software to include a copyright notice, the license itself is evidence of Darrah’s
efforts to control the use of the “CoolMail” mark in connection with the Software.

19
The court reasoned as follows:

While the law does not require a nationwide business; an old,
established business; or even a profitable business for the acquisition
of property interests in trade or service marks, it does require a
presently existing trade or business for such acquisition. The exhibits
disclose that Plaintiff had only a desire to open a business in futuro.
To hold otherwise would make a trade mark a property right in gross,
instead of a right appurtenant.

Id. (emphasis in original). The Heinemann court also found that plaintiff

Heinemann’s activities consisted merely of occasionally racing or displaying the

automobile at fairs as a hobby, as evidenced by his testimony that he was

employed at an oil company. Id. Here, Darrah did not attempt to “warehouse” the

mark by promoting a product he merely intended to develop and distribute at a

later date. Darrah’s use of the mark to designate the distributed Software and each

subsequent version thereof indicates that his use was not mere sporadic or token

use.17 Furthermore, unlike Heinemann, Darrah activities pertained to his chosen

17
Appellants contend that the district court erred in “ignoring” the first sentence of the present
definition of “use in commerce” (“the bona fide use of a mark in the ordinary course of trade,
and not made merely to reserve a right in a mark”), which was added pursuant to the Trademark
Law Revision Act of 1988 (“Revision Act”), Pub. L. No. 100-667, 102 Stat. 3935 (1988). The
court in Allard found that a magistrate judge’s reliance on case law that antedated the revision
was proper because the language of the revised definition is “entirely consistent with the
traditional rules governing common-law ownership of trademarks.” 146 F.3d at 357. The Allard
court noted that “the purpose of this revision ‘was to eliminate ‘token use’ as a basis for
registration, and that the stricter standard contemplates instead commercial use of the type
common to the particular industry in question.’” Id. (citation omitted).
The reason “token use” was expressly eliminated was that the Revision Act had created
an “intent-to-use” application system that rendered such a “commercial sham” unnecessary. See
(continued...)

20
profession. Darrah is employed as a computer systems administrator, which

entails the management and oversight of computer networks and systems as well as

the development of software in support thereof.

Appellants also rely on DeCosta v. Columbia Broad. Sys., Inc., 520 F.2d

499, 513 (1st Cir. 1975), cert. denied, 423 U.S. 1073 (1976), to argue that Darrah is

an eleemosynary individual and therefore unworthy of protection under unfair

competition laws. The DeCosta court did not hold that the that the absence of a

profit-oriented enterprise renders one an eleemosynary individual, nor did it hold

that such individuals categorically are denied protection. Rather, the DeCosta court

expressed “misgivings” of extending common law unfair competition protection,

clearly available to eleemosynary organizations, to eleemosynary individuals.18

Id. The court’s reluctance to extend protection to eleemosynary individuals was

17
(...continued)
134 Cong. Rec. 32,053 (Oct. 20, 1988) (Sen. DeConcini). The revision did not alter the meaning
of the phrase “sold or transported in commerce” or in any way increase the quantum of use
necessary to acquire trademark ownership as developed by common law. See id. (“Congress’
intent that the revised definition still encompass genuine, but less traditional, trademark uses
must be made clear. For example, such uses as clinical shipments of a new drug awaiting FDA
approval, test marketing, or infrequent sales of large or expensive or seasonal products, reflect
legitimate trademark uses in the normal course of trade and are not to be excluded by the House
language.”). There is no evidence to support the contention that Darrah’s purpose was merely to
secure trademark rights to reserve the mark for future use.
18
It is unlikely that the plaintiff’s activities in De Costa -- costumed performances and
distribution of his picture at local rodeos, parades, hospitals, etc. -- would generate a “public
association” sufficient to confer him common law trademark ownership rights. The court
assumed arguendo, however, that the plaintiff’s activities did warrant protection, and went on to
find that the evidence did not support a finding of likelihood of confusion.

21
based on an apparent difficulty in establishing a line of demarcation between those

eleemosynary individuals engaged in commerce and those that are not. But as the

sufficiency of use to establish trademark ownership is inherently fact-driven, the

court need not have based its decision on such a consideration. Mendes, 190 F.2d

at 418. Common law unfair competition protection extends to non-profit

organizations because they nonetheless engage in competition with other

organizations.19 See Girls Clubs of Am., Inc. v. Boys Clubs of Am., Inc., 683 F.

Supp. 50 (S.D.N.Y. 1988), aff’d, 859 F.2d 148 (2d Cir.). Thus, an eleemosynary

individual that uses a mark in connection with a good or service may nonetheless

acquire ownership rights in the mark if there is sufficient evidence of competitive

activity. 20

19
The DeCosta court recognized that “the law of unfair competition . . . protects ‘eleemosynary
organizations (which) function in commerce and, in form, resemble business enterprises . . . .
The happenstance that they are nonprofit-seeking ventures, and therefore removed, as such, from
the rigors of business competition, neither eliminates the element of competition nor disentitles
them to protection against the unfair competition of similar organizations.’” 520 F.2d at 512
(quoting Callman, Vol. 1, s 1.1, p. 4).
20
The DeCosta court noted that

[common law unfair competition] [p]rotection at present has the merits of
inherent limitations: the existence of a trade, business, or profession where the
‘good will’ to be protected has been subject to the acid test of the willingness of
people to pay for goods or services; or, in the case of nonprofit institutions, the
voluntary investment in time, effort, and money of many individuals to create
and maintain a program of sufficient interest to consumers, members, and
sponsors to warrant protection.

(continued...)

22
 Here, Darrah’s activities bear elements of competition, notwithstanding his

lack of an immediate profit-motive. By developing and distributing software under

a particular mark, and taking steps to avoid ceding the Software to the public

domain, Darrah made efforts to retain ownership rights in his Software and to

ensure that his Software would be distinguishable from other developers who may

have distributed similar or related Software. R2-47-Exh. 3 at 67. Competitive

activity need not be fueled solely by a desire for direct monetary gain. Darrah

derived value from the distribution because he was able to improve his Software

based on suggestions sent by end-users. Just as any other consumers, these end-

users discriminate among and share information on available software. It is logical

that as the Software improved, more end-users used his Software, thereby

increasing Darrah’s recognition in his profession and the likelihood that the

Software would be improved even further.

In light of the foregoing, the use of the mark in connection with the Software

constitutes significant and substantial public exposure of a mark sufficient to have

20
(...continued)
520 F.2d at 513.

We find that such an “inherent limitation,” if it in fact exists, is inapplicable in this
context. One individual can invest time, effort and money in developing software or other
technologically-based goods or services that would be of interest to a multitude of users, other
developers, and retail establishments. In fact, the program was of sufficient interest for S.u.S.E.
to put effort into including it in its own software which was sold for profit, including the effort of
obtaining Darrah’s permission under the GNU General Public License.

23
created an association in the mind of public.

II. Likelihood of Confusion

The district court supported its determination of “likelihood of confusion”

with the following findings: (1) the mark used by Planetary Motion (“Coolmail”)

is “essentially the

same” as that used by Techsplosion (“CoolMail”)21; (2) both marks are used in

connection with e-mail services; (3) both plaintiff and defendants serve e-mail

customers via the Internet; and (4) both use the Internet to promote their services.

R2-62-7.22 Appellants do not dispute the accuracy of these findings. Rather,

Appellants claim the district court improperly based its analysis on a comparison of

the parties’ respective e-mail services, rather than on a comparison of

21
The Ninth Circuit in Brookfield Communications, Inc. v. W. Coast Entm’t Corp., 174 F.3d
1036, 1055 (1999), explained that the domain name "moviebuff.com" was virtually identical to
“MovieBuff,” because “Web addresses are not caps-sensitive.”

22
This Court considers the following seven factors in assessing whether or not a likelihood of
consumer confusion exists: (1) type of mark; (2) similarity of mark; (3) similarity of the
products the marks represent; (4) similarity of the parties’ retail outlets (trade channels) and
customers; (5) similarity of advertising media; (6) defendant's intent; and (7) actual confusion.
See Lone Star, 122 F.3d at 1382. Of these, the type of mark and the evidence of actual confusion
are the most important. See Dieter v. B & H Indus. of Southwest Fla., Inc., 880 F.2d 322, 326
(11th Cir. 1989), cert. denied, 498 U.S. 950 (1990). In this case, there is evidence that end-users
subscribed to Techsplosion’s e-mail service under the impression they were subscribing to
Planetary Motion’s service. See R2-46-Exh. 1-G.

24
Techsplosion’s “CoolMail” e-mail service to the “Coolmail” Software. Appellants

argue that the latter comparison is required because Planetary Motion acquired its

rights to the “Coolmail” mark by assignment of rights in Darrah’s Software, and

under the “natural expansion” doctrine this is a use unrelated to Planetary Motion’s

current use of e-mail services. Thus, Appellants’ argument in essence goes to

whether the scope of trademark protection enjoyed by Planetary Motion extends

from the initial use (in connection with the Software) to the current use (in

connection with Planetary Motion’s e-mail services).

The scope of protection enjoyed by a trademark owner is not restricted to the

owner’s original use. The “natural expansion” doctrine is applied to determine the

proper scope of protection where a mark owner’s previous use differs from its

current use, and the junior use intervenes. Under this doctrine, the first trademark

owner’s rights are limited to goods on which the mark has already been used or

that lie within the realm of natural expansion; “[t]his appears to be no more than a

specific application of the familiar ‘related goods’ test.” J. McCarthy, § 24:20.23

23
The theory of “natural expansion” as applied to determinations of the scope of protection
“relates to a situation where the senior user of mark A on product line X expands use of mark A
to product line Z and conflicts with an ‘intervening junior user' who has already been using mark
A on product line Z.” J. McCarthy, § 24:20. This differs from the “natural expansion” doctrine
as applied to determining the geographical delimitation of common law trademark rights. See id.
§ 26:20; Tally-Ho, 889 F.2d at 1023, 1027-29.

The ‘natural expansion’ thesis seems to be nothing more than an unnecessarily
(continued...)

25
See also Carnival, 187 F.3d at 1310-11.

The court in Tally-Ho explained that a senior user’s rights “may extend into

uses in ‘related’ product or service markets (termed the ‘related goods doctrine’),”

and that “an owner of a common law trademark may use its mark on related

products or services and may enjoin a junior user’s use of the mark on such related

uses . . . .” 889 F.2d at 1023 (citing J. Mc.Carthy, § 24:1 to 24:12). This rule is

limited by equitable considerations. The court in Carnival noted that “[A]

trademark owner cannot by the normal expansion of its business extend the use or

registration of its mark to distinctly different goods or services not comprehended

by its previous use . . . where the result could be a conflict with valuable

intervening rights established by another through extensive use . . . of the same or

similar mark for like or similar goods and services.” 187 F.3d at 1310-11 (citations

and internal quotation marks omitted) (emphasis added).

Courts determine the proper scope of protection of a mark in the context of

intervening uses by applying the “source or sponsorship” test. Under this test, a

23
(...continued)
complicated application of the likelihood of confusion of source or sponsorship
test to a particular factual situation. If the intervening use was likely to cause
confusion [with respect to the mark owner’s previous use], it was an infringement
and the senior user has the right to enjoin such use, whether it had in fact already
expanded itself or not.

J. McCarthy, § 24:20.

26
trademark owner has “protection against use of its mark on any product or service

which would reasonably be thought by the buying public to come from the same

source, or thought to be affiliated with, connected with, or sponsored by, the

trademark owner.” J. McCarthy, § 24:6. The public perception in this regard is

determined at the time the junior user first used the mark on the product or service

to which the allegedly infringing mark is affixed.24 Carnival, 187 F.3d at 1312.

The court in Tally-Ho explained that “related use” is “merely a facet of the

likelihood of confusion test and therefore requires an inquiry into [the] seven

factors affecting the likelihood of confusion . . . .”25 889 F.2d at 1027.

24
Techsplosion, the junior user in this case, first used the mark "CoolMail" in connection with
its e-mail service in April 16, 1998, before Planetary motion filed its intent-to-use application.
25
The court in Carnival explained the “source or sponsorship” inquiry in this context as follows:

The likelihood-of-confusion test, when applied at this stage in order to
determine priority where there are issues of related use, does not substitute for the
likelihood-of-confusion test that controls whether infringement of the plaintiff's
trademark is occurring or has occurred. These are two independent inquiries.
Once priority in the use of a mark for a particular class of goods or services has
been established, then it is necessary to perform the [liability stage]
likelihood-of-confusion test, as of the current time and as between the plaintiff's
current products (i.e., those that inherit the priority with respect to the previously
used mark) and the allegedly infringing products of the defendant, to determine
whether the plaintiff ultimately prevails in a trademark infringement litigation.

187 F.3d at 1311, n. 4 (citation omitted).

Thus, evidence supporting a finding of “related use” need not rise to the level of finding
likelihood of confusion for the purposes of establishing liability, but may nonetheless serve as a
guide for determining the scope of protection.

27
 We find that the relatedness between e-mail notification software and a

service that allows users to check e-mail via telephone line is not so attenuated that

the district court mistakenly failed to limit Planetary Motion’s rights in the mark to

its use in connection with the Software. Consumers reasonably could attribute the

Software and an e-mail service under the same name to the same source for several

reasons.26 Both the Software and the e-mail service belong to the same general

field of commerce, i.e., information technology, and both deal more specifically

with e-mail.27 Appellants do not dispute Planetary Motion’s contention that major

firms in this field sell e-mail software as well as provide e-mail service.28 See

Darrah Affidavit, R2-46-Exh. 2 at ¶ 34. Both the Software and the e-mail service

26
The extension of Planetary Motion’s rights to the mark in connection with its e-mail service
does not, as Appellants assert, hinge on whether Darrah intended to launch, or even was capable
of launching, an e-mail service similar to those of the parties. For goods or services to be
“related,” they need not have exactly the same customer base or be in direct competition with
one another.
27
Cf. Commerce Nat’l Ins. Servs., Inc. v. Commerce Insurance Agency, Inc., 214 F.3d 432,
438, 441-43 (3d Cir. 2000). The court in Commerce Nat’l found clear error in the district court’s
“likelihood of confusion” analysis that had been based “primarily on the assumption that
banking and insurance are similar industries in the minds of consumers and that consumers
would expect banks to expand into the insurance industry,” where evidence of such perception
consisted of an affidavit and an “unpersuasive report” and where state law limited banks from
engaging in the general insurance industry. 214 F.3d at 441.
28
See Scarves by Vera, Inc. v. Todo Imports, Ltd., 544 F.2d 1167, 1174-75 (2d Cir. 1976). The
court in Scarves by Vera found a use of mark on cosmetics to infringe on use on apparel and
household linens, even though plaintiff had no plans to enter the former market. The court
reasoned that other fashion designers were commonly involved in both markets, such that
customers would likely assume that defendant’s use was a similar expansion by plaintiff.

28
involve sending messages over the Internet: the former provides a functionality

that enables a user with e-mail capability to receive notification of new mail, and

the latter enables subscribers to the service to send and receive e-mail. Both the

Software and the e-mail service were promoted over the Internet to those who

make use of e-mail.

Furthermore, the equities do not necessarily favor Techsplosion.29

Techsplosion’s “CoolMail” e-mail service had not been in operation for an

extended period of time before Planetary Motion entered the market under the

name “Coolmail,” and Planetary Motion is not merely attempting to reserve the

mark for a future business endeavor. Accordingly, we sustain the district court’s

finding of “likelihood of confusion.”

III. Relief

Review of the district court’s award of injunctive relief, attorney’s fees and

costs is for abuse of discretion. See Burger King Corp. v. Weaver, 169 F.3d 1310,

29
See Rosenthal A.G. v. Rite Lite, Ltd, 986 F. Supp. 133, 141 (E.D.N.Y. 1997) (“[A]bsent
equities in a defendant’s favor, courts should enjoin defendants ‘from using a similar trademark
whenever the non-competitive products are sufficiently related that customers are likely to
confuse the source of origin.’”) (citation omitted). The court in Rosenthal, relying on
“undisputed evidence and basic common sense,” found the two markets at issue to be sufficiently
related and noted that the equities did not tip in the defendant’s favor where the plaintiff had in
fact entered the defendant’s market. Id. (“[T]he interest at stake is more than plaintiff’s interest
in being able to enter a related market at some future time . . . .”).

29
1315 (11th Cir.), cert. dismissed, 528 U.S. 948 (1999); Tally-Ho, 889 F.2d at 1022.

A. Injunctive Relief

Appellants assert that the injunctive relief awarded by the district court is

impermissibly vague and overbroad. Appellants contend that the language

“imposes a grossly unfair burden on Techsplosion, as it does not allow for a

determination of what is and is not permitted under the injunctive provisions.”

Appellants’ Brief at 40. Federal Rule of Civil Procedure 65(d) states in relevant

part: “Every order granting an injunction . . . shall be specific in terms [and] shall

describe in reasonable detail . . . the act or acts sought to be restrained . . . .”30

Fed. R. Civ. P. 65(d). A clear and unambiguous order is one that leaves “‘no

uncertainty in the minds of those to whom it is addressed,’ . . . who must be able to

ascertain from the four corners of the order precisely what acts are forbidden.’”

King v. Allied Vision, Ltd., 65 F.3d 1051, 1058 (2d Cir. 1995) (citations omitted).

Optimally, the injunction

should clearly let defendant know what he is ordered to do or not to
do. A court order should be phrased in terms of objective actions, not
legal conclusions. An injunction which merely forbids a defendant
from performing “acts of unfair competition,” or from “infringing on

30
Three considerations underlie the specificity requirements of Rule 65(d): “to prevent
uncertainty and confusion on the part of those faced with injunctive orders, . . . to avoid the
possible founding of a contempt citation on a decree too vague to be understood . . . [and] for an
appellate tribunal to know precisely what it is reviewing.” Schmidt v. Lessard, 414 U.S. 473,
476-77 (1974) (per curiam).

30
 plaintiff’s trademarks and trade secrets” adds nothing to what the law
already requires.

John H. Harland Co. v. Clarke Checks, Inc., 711 F.2d 966, 984-985 (11th Cir.

1983) (quoting J. McCarthy, at § 30.13) (emphasis added).

Notwithstanding these strictures, appellate courts do not set aside injunctions

under Rule 65(d) “unless they are so vague that they have no reasonably specific

meaning.” E. & J. Gallo Winery v. Gallo Cattle Co., 967 F.2d 1280, 1297 (9th Cir.

1992). Rather than applying Rule 65(d) rigidly, appellate courts determine the

propriety of an injunctive order by inquiring into whether the parties subject

thereto understand their obligations under the order. Williams v. City of Dothan,

818 F.2d 755, 761 (11th Cir. 1987) (citing Combs v. Ryan's Coal Co., 785 F.2d

970, 978-79 (11th Cir.), cert. denied sub nom. Simmons v. Combs, 479 U.S. 853

(1986)), modified, 828 F.2d 13 (11th Cir. 1987). Furthermore, the degree of

particularity required depends on the nature of the subject matter. McComb v.

Jacksonville Paper Co., 336 U.S. 187, 191-92 (1949) (decrees of generality are

often necessary to prevent further violations where a proclivity for unlawful

conduct has been shown) .

Here, although several parts of the order are phrased in terms of legal

conclusions, the order, read as a whole, clearly indicates what Techsplosion is

31
forbidden from doing.31 According to the order, Techsplosion is permanently

enjoined from using the name “Coolmail” in connection with “e-mail or other

Internet-related services,” in connection with software, and as part of the domain

name of its website. These limitations sufficiently define the scope of the

injunction and give context to the arguably legally conclusory language included

therein. Furthermore, the use of “any similar mark” after references to “Coolmail”

does not detract from this level of specificity. See Planned Parenthood, 152 F.3d

920 (upholding preliminary injunction that prohibited defendant from using mark

or “any colorable imitation of [that] mark” anywhere on the Internet and from

31
The injunction reads, in relevant part as follows:
[Techsplosion is] permanently enjoined from (a) Using the name “Coolmail,” or any
similar mark, in connection with the offer, promotion, distribution, sale, advertisement or
provision of services relating to e-mail or other Internet-related services; (b) Using the name
“Coolmail,” or any similar mark, in connection with the offer, promotion, distribution, sale,
advertisement or provision of software; (c) Using Coolmail.com as the domain name of their
website; (d) Using any logo, trade name, trademark or servicemark which may be calculated to
represent falsely that the services or products of defendants are affiliated, connected, or
associated with Planetary Motion; (e) Using any logo, trade name or servicemark which may be
calculated to falsely represent that the services or products of defendants are sponsored by,
authorized by, approved by, or originate from Planetary Motion; (f) Using the name “Coolmail”
in any fashion that would damage the business reputation of Planetary Motion, or any of its
successors, assigns, affiliates, subsidiaries, or parents, or that would dilute the value of the
“Coolmail” mark; (g) Otherwise infringing on the “Coolmail” mark; (h) Unfairly competing with
Planetary Motion; and Aiding, abetting or assisting any other person or entity in engaging in or
performing any activities stated in paragraphs (a) through (h) above.

R2-63.
Sections (g) and (h) are conclusory catch-all provisions. Although sections (d) through
(f) use legal terminology, they are linked to Planetary Motion and its rights in the “Coolmail”
mark such that Techsplosion likely will not violate the injunction if it completely ceases the use
of “Coolmail” in connection with e-mail services or markets related thereto.

32
taking actions “likely to cause confusion” among Internet users regarding Planned

Parenthood's endorsement or sponsorship of defendant's site). Appellants do not

propose any reading of the language in the injunction that would impermissibly

prohibit conduct that Techsplosion arguably has the right to do. Cf. B. H. Bunn

Co. v. AAA Replacement Parts Co., 451 F.2d 1254, 1269 (5th Cir. 1971) (finding

injunction impermissible where broad reference to opinion’s findings of fact

“[appeared to] enjoin perfectly legal acts”). But see AmBrit, Inc. v. Kraft, Inc.,

812 F.2d 1531, 1547- 48 (11th Cir. 1986) (“An injunction can be therapeutic as

well as protective. In fashioning relief against a party who has transgressed the

governing legal standards, a court of equity is free to proscribe activities that,

standing alone, would have been unassailable.”) (citation omitted), cert. denied,

481 U.S. 1041 (1987). Nor do Appellants explain how the wording of the

injunction could lend itself to alternate interpretations. In the absence of any

apparent contextual ambiguities or alternate readings prohibiting legal conduct, it

is unlikely that Appellants will misapprehend what conduct is proscribed, or will

incur liability to contempt citations for activities not contemplated by this order.

B. Attorney Fees

Awards of attorney fees are reviewable only to determine if the trial court

33
abused its discretion in granting or denying them.32 See St. Charles Mfg. Co. v.

Mercer, 737 F.2d 891, 894 (11th Cir. 1983). Fla. Stat. § 495.151 provides for

injunctive relief only. Under Section 35(a) of the Lanham Act, however, courts

may award reasonable attorney fees to the prevailing party “in exceptional cases.”

15 U.S.C. § 1117(a). See also Montgomery, 168 F.3d at 1304. Exceptional cases

are those where the infringing party acts in a “malicious, fraudulent, deliberate, or

willful manner.” Burger King Corp. v. Pilgrim’s Pride Corp., 15 F.3d 166, 168

(11th Cir. 1994) (quoting S.R. Rep. 93-1400 (1974), reprinted in 1974

U.S.C.C.A.N. 7132, 7133) (internal quotation marks omitted).

Here, the district court awarded attorney fees without articulating a basis for

doing so, let alone the factual circumstances that would warrant such an award.33

Furthermore, there is nothing in the record to support a finding of “malicious,

fraudulent, deliberate, or willful” conduct on the part of Planetary motion.

Remand is therefore unnecessary on this issue. Accordingly, we find that the

award of attorney fees is an abuse of discretion and vacate the award.

32
As Techsplosion timely filed an appeal from the order fixing the amount of attorney fees
and costs, and we may reach the issue. See Budinich v. Becton Dickinson & Co., 486 U.S. 196,
202-203 (1988).
33
Planetary Motion asserts that Techsplosion learned in early 1999 of its use of the “Coolmail”
mark, and that “Planetary Motion possessed senior rights in the Coolmail mark.” Since
Techsplosion reasonably could have assumed that Planetary Motion lacked priority in the mark,
such knowledge in this case does not invariably give rise to a finding of deliberate or malicious
infringement.

34
 c. Award of Costs

Under the Lanham Act, a successful party “subject to the principles of

equity” may recover: “(1) defendant’s [the infringer’s] profits; (2) any damages

sustained by the plaintiff, and (3) the costs of the action.” 15 U.S.C. § 1117(a). See

Babbit Elecs., Inc. v. Dynascan Corp., 38 F.3d 1161, 1182 (11th Cir. 1994). To

recover costs under the Lanham Act, therefore, a plaintiff need not establish that

the alleged infringer acted maliciously, fraudulently, deliberately, or willfully.

Because it was within the district court’s discretion to award costs, and in the

absence of any evidence that would warrant a finding that the balance of equities

necessarily tipped in favor of Techsplosion, we uphold the award of costs to

Planetary Motion.

Conclusion

Accordingly, the district court’s order and final judgment are AFFIRMED,

except that the order adopting the magistrate judge’s report and recommendation,

with respect to the award of attorney fees, is VACATED.

35