Last week, the U.S. Court of Appeals for the Tenth Circuit issued an opinion in Alfwear, Inc. v. Mast-Jӓegermeister US, Inc., No. 22-4020 (Nov. 28, 2023), affirming the denial of attorney’s fees to Jӓegermeister after it prevailed on summary judgment.
Alfwear sued Jӓegermeister for trademark infringement and unfair competition, claiming the liqueur manufacturer’s use of the term “KüHL” in advertising campaigns was likely to cause confusion with the outdoor clothing company’s KüHL brand name. After discovery, Jӓegermeister moved for and was granted summary judgment. The Tenth Circuit affirmed.
As the prevailing party on summary judgment, Jӓegermeister moved for an award of attorney’s fees. The district court denied the motion, concluding the case was not sufficiently exceptional to warrant an award under 15 U.S.C. § 1117(a). Jӓegermeister appealed, arguing it was entitled to an award of fees based on the weakness of Alfwear’s claims from the case’s inception and its vexatious litigation tactics.
The Tenth Circuit affirmed, finding no abuse of discretion. Applying the same standard applicable to the exceptional-case attorney fees provision in the Patent Act, the Court emphasized that not every case dismissed on summary judgment can be considered exceptional. Rather, a plaintiff’s suit must lack any reasonable foundation. The Court found no clear error in the district court’s conclusion that, because Alfwear’s claims were sufficiently meritorious to survive the motion-to-dismiss phase, the case was not so meritless that it rose to the level of exceptional. As for Jӓegermeister’s arguments about Alfwear’s litigation conduct, evidence that both parties engaged in hard-fought litigation tactics, including the complained-of filing of parallel proceedings before the Trademark Trial and Appeal Board and other federal district courts, was sufficient to satisfy the Court that the district court’s finding of equivalence in the parties’ conduct was not arbitrary. That Jӓegermeister disagreed with the district court’s findings did not establish an abuse of discretion.
