PlayNation Play Systems, Inc. v. Velex Corporation
939 F.3d 1205
11th Cir.2019Background
- PlayNation (maker of "Gorilla Playsets") sued Velex (seller of "Gorilla Gym" doorway bars and children's accessories) for trademark infringement; district court found infringement and entered a permanent injunction forbidding use of the "Gorilla Gym" name for children’s playground equipment.
- This Court previously affirmed the injunction but vacated a damages award; after the injunction Velex rebranded online (to "GymX"/"Gym1") but some online references and boxed goods bearing "Gorilla Gym" remained in commerce.
- PlayNation moved for civil contempt after customers received Gorilla Gym–branded shipments post-injunction; the district court found Velex and its two sole officers/shareholders (Velikin and Alexandrov) in civil contempt, awarded $1,500 in compensatory damages and $46,465.25 in attorneys’ fees and costs, and the defendants appealed.
- Velex contended it made reasonable, good-faith efforts to comply, blamed third-party shippers (Amazon/Capacity) for packing/shipping errors, and argued the officers should not be personally liable; it also challenged timeliness and sufficiency of the notice of appeal.
- The Eleventh Circuit reviewed contempt findings for abuse of discretion and factual findings for clear error, addressed jurisdiction/timeliness issues, and affirmed the contempt finding and the attorneys’ fees award.
Issues
| Issue | PlayNation's Argument | Velex's Argument | Held |
|---|---|---|---|
| Sufficiency of notice of appeal as to officers | The notice of appeal covered the orders affecting the officers; they intended to appeal. | Notice named only Velex (corporation); officers did not file separate notices, so no jurisdiction as to them. | Notice objectively made officers’ intent to appeal clear under Fed. R. App. P. 3(c)(4); appellate jurisdiction exists over officers. |
| Timeliness/finality of appeal | Appeal was timely from the final judgment that fixed contempt penalties and fees. | The December 14 contempt order started the clock; notice filed after 30 days was untimely. | Appeal was timely: contempt became final only when fees were quantified (June order) and amendment extended the appeal period; notice filed within the required time. |
| Civil contempt (whether injunction was violated / inability to comply) | PlayNation showed clear and convincing evidence of post-injunction online use and shipments; burden shifted to Velex to prove inability to comply. | Velex argued third-party/agent errors, good-faith efforts, and lack of willfulness; claimed it took substantial steps to comply. | Contempt affirmed: multiple shipments and persistent online references satisfied prima facie violation; Velex failed to show it made all reasonable efforts or present inability to comply. |
| Personal liability of corporate officers | Officers, as those controlling the corporation, are responsible for corporate compliance and may be held in contempt. | Officers argued they should not be held individually liable. | Held: officers can be held in contempt for corporate disobedience; Velikin and Alexandrov properly held jointly and severally liable. |
| Attorneys’ fees for contempt | Fees are recoverable to enforce compliance and to compensate enforcement costs even absent willfulness. | Fees improper because Velex acted in good faith, award disproportionate to damages, and PlayNation achieved only limited success. | Fee award affirmed: district court acted within discretion; willfulness not required; fees were reasonable enforcement expenses. |
Key Cases Cited
- PlayNation Play Sys., Inc. v. Velex Corp., 924 F.3d 1159 (11th Cir. 2019) (prior appeal affirming injunction, vacating damages)
- Howard Johnson Co. v. Khimani, 892 F.2d 1512 (11th Cir. 1990) (civil contempt burden-shifting and compliance standard)
- Combs v. Ryan’s Coal Co., 785 F.2d 970 (11th Cir. 1986) (generally interlocutory nature of contempt findings and finality considerations)
- Sizzler Family Steak Houses v. W. Sizzlin Steak House, Inc., 793 F.2d 1529 (11th Cir. 1986) (attorney’s fees in contempt are within district court discretion)
- F.T.C. v. Leshin, 618 F.3d 1221 (11th Cir. 2010) (abuse-of-discretion standard for contempt sanctions review)
- Holloman v. Mail-Well Corp., 443 F.3d 832 (11th Cir. 2006) (notice of appeal may suffice if intent to appeal is objectively clear)
- United States v. Fleischman, 339 U.S. 349 (U.S. 1950) (individuals responsible for corporate affairs may be held for corporate noncompliance)
- Fort v. Roadway Exp., Inc., 746 F.2d 744 (11th Cir. 1984) (attorney-fee awards not final until amount is determined)
- Maness v. Meyers, 419 U.S. 449 (U.S. 1975) (court orders must be promptly complied with)
- Hensley v. Eckerhart, 461 U.S. 424 (U.S. 1983) (principles for awarding attorneys’ fees)