MARY KAY INC. v. Ayres
2011 U.S. Dist. LEXIS 124294
D.S.C.2011Background
- Mary Kay filed suit against Ayres for willful trademark infringement and related claims; Ayres failed to answer; default was entered.
- Court granted Mary Kay’s Preliminary Injunction prior to default judgment; Mary Kay later moved for default judgment, fees, and costs.
- Magistrate Judge Hodges recommended default judgment for Lanham Act claims and a permanent injunction; the district judge adopted the recommendation.
- Court awarded Mary Kay $16,671.30 (attorneys’ fees of $16,078 and costs of $593.30) and issued a permanent injunction and destruction-order provisions.
- Court reduced billed hourly rates (from $340 and $285 to $200) for Mary Kay’s attorneys due to lack of market-rate evidence, and limited costs to those allowed by statute and local rule.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Lanham Act claims support default judgment | Mary Kay owns valid marks and Ayres used them in commerce causing confusion | Ayres failed to contest; no argument presented | Lanham Act claims supported; default judgment granted |
| Whether attorneys’ fees and costs are recoverable | Exceptional case; reasonable fees and costs warranted | Ayres did not contest; none presented | Fees awarded but rates reduced to $200/hour; costs awarded as recommended |
| Whether a permanent injunction is appropriate | Irreparable harm and likelihood of confusion justify injunction | Not applicable due to default | Permanent injunction granted and destruction order approved |
| Whether destruction and compliance reporting are appropriate | Destruction of infringing materials necessary to prevent confusion | Not applicable | Destruction and post-injunction compliance reporting approved |
Key Cases Cited
- People for the Ethical Treatment of Animals v. Doughney, 263 F.3d 359 (4th Cir. 2001) (likelihood of confusion elements for Lanham Act)
- CareFirst of Md., Inc. v. First Care, P.C., 434 F.3d 263 (4th Cir. 2006) ( Lanham Act infringement requires ownership of a protectable mark and likelihood of confusion)
- Shell Oil Co. v. Commercial Petroleum, Inc., 928 F.2d 104 (4th Cir. 1991) (improper use of marks can be deceptive and likely to confuse consumers)
- eBay, Inc. v. MercExchange, LLC, 547 U.S. 388 (2006) (permanent injunction factors require irreparable harm and balance of hardships)
- American Rice, Inc. v. Producers Rice Mill, Inc., 518 F.3d 321 (5th Cir. 2008) (courts may limit or tailor remedies under equitable principles)