Purepecha Enters., Inc. v. El Matador Spices & Dry Chiles

When the registrant of a trademark offers evidence of infringing sales and the infringer fails to prove its statutory burden to offer evidence of deductions, the registrant’s entitlement to profits under the Lanham Act is equal to the infringer’s gross sales.

Opinion (St. Eve): In 2011, Purepecha Enterprises, Inc. ("Purepecha") filed an extensive suit alleging trademark infringement and dilution against El Matador Spices and Dry Chiles ("El Matador") for El Matador's Matador Brothers trademark. The court entered default judgment in favor of Purepecha for failure to prosecute. Purepecha moved for damages pursuant to FRCP 55(b)(2). Purepecha sought lost profits and treble damages under the Lanham Act provision, which states treble damages may be awarded if an infringer’s violation consists of intentionally using a mark, knowing such a mark is a counterfeit mark, save for extenuating circumstances. The court declined to award treble damages based on insufficient evidence to establish that El Matador knew the mark to be counterfeit. Since El Matador caused unnecessary delay in litigation, the court found an award of attorney's fees to Purepecha to be appropriate under the Illinois Consumer Fraud Act. Therefore, the court AWARDED Purepecha damages in the amount of $3,200,214.00.