H-D U.S.A., LLC v. SunFrog, LLC
311 F. Supp. 3d 1000
| E.D. Wis. | 2018Background
- Harley‑Davidson (H‑D) sued SunFrog, an online print‑on‑demand marketplace, alleging large‑scale trademark counterfeiting, trademark infringement, false designation of origin, dilution, and related state/common‑law claims based on user‑uploaded designs incorporating H‑D marks sold on SunFrog products.
- SunFrog hosts an "All Art" database, permits sellers (often anonymous) to apply uploaded designs to blank goods, prints and ships ordered items, and retains the majority of sales revenue; many infringing listings were promoted via Facebook ads.
- Harley‑Davidson submitted numerous takedown notices (over 800 items across months); SunFrog removed listings but infringing designs repeatedly reappeared, removals were often delayed, and some infringing items were shipped from SunFrog’s facility.
- SunFrog argued it was a neutral service provider with industry‑standard notice‑and‑takedown procedures and evolving anti‑infringement tools (keyword filters, OCR, bot‑controls), and relied on defenses analogizing itself to online marketplaces like eBay.
- The court found SunFrog actively used the marks (printing, packaging, advertising, shipping, payment processing), that H‑D’s marks are valid and famous, and that SunFrog’s conduct amounted to willful counterfeiting and infringement.
- Court granted partial summary judgment for Harley‑Davidson on federal and state trademark claims (including counterfeiting and dilution), awarded statutory damages of $19,200,000, and ordered a permanent injunction; copyright claims and compensatory damages remain for trial.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether SunFrog is liable for trademark infringement/counterfeiting (use in commerce; ornamental use) | H‑D: SunFrog used H‑D marks in commerce by advertising, printing, labeling, shipping, and profiting from goods bearing H‑D marks; marks are virtually identical → counterfeiting and likelihood of confusion | SunFrog: marks were ornamental/user‑generated; it merely hosted designs and automated printing, so it did not "use" marks as a trademark | Court: SunFrog "used" the marks; reproductions were substantially indistinguishable; counterfeiting and infringement established as matter of law |
| Whether SunFrog is protected by Tiffany/eBay‑style safe‑harbor (contributory infringement) | H‑D: SunFrog’s deeper involvement (operates printers, ships goods, advertises) and willful blindness distinguish it from eBay; it induced and profited from infringement | SunFrog: industry standard notice‑and‑takedown, no specific pre‑suit discovery of every infringing listing; analogizes to eBay (Tiffany) | Court: Tiffany inapplicable—SunFrog’s role in manufacture, fulfillment, and active promotion (and slow/ineffective takedowns) shows intent/knowledge; contributory defense rejected |
| Whether H‑D’s marks are "famous" for dilution claim | H‑D: marks (HARLEY‑DAVIDSON, HARLEY, H‑D, HD, Bar & Shield) are nationally famous and distinctive through long use, sales, and promotion | SunFrog: challenges fame (esp. short letter marks), urges discovery to test fame | Court: Marks are famous and distinctive as a matter of law; dilution by blurring and tarnishment established |
| Whether statutory damages and injunctive relief are appropriate (willfulness) | H‑D: SunFrog’s pattern of ignored notices, misleading court, and post‑suit violations show willful counterfeiting warranting statutory damages and permanent injunction | SunFrog: argues statutory damages inappropriate/excessive; reliance on evolving anti‑infringement efforts and limited profits from specific items | Court: Infringement was willful; statutory damages awarded ($300,000 per mark per type → $19,200,000); permanent injunction granted |
Key Cases Cited
- Anderson v. Liberty Lobby, 477 U.S. 242 (U.S. 1986) (summary judgment standards and "genuine dispute" test)
- Inwood Labs., Inc. v. Ives Labs., 456 U.S. 844 (U.S. 1982) (contributory trademark infringement standard: inducement or knowledge of infringement)
- Tiffany (NJ) Inc. v. eBay, Inc., 600 F.3d 93 (2d Cir. 2010) (online marketplace liability; need for particularized knowledge to support contributory liability)
- Ty, Inc. v. Jones Group, Inc., 237 F.3d 891 (7th Cir. 2001) (likelihood‑of‑confusion factors and marketplace context for mark comparison)
- CAE, Inc. v. Clean Air Eng'g, 267 F.3d 660 (7th Cir. 2001) (post‑sale confusion relevance and strength of marks)
- Hard Rock Cafe Licensing Corp. v. Concession Servs., 955 F.2d 1143 (7th Cir. 1992) (willful blindness equates to knowledge for contributory infringement)
- Gabbanelli Accordions & Imports, L.L.C. v. Gabbanelli, 575 F.3d 693 (7th Cir. 2009) (statutory damages in trademark counterfeiting cases and per‑type‑of‑goods rule)