EXPERIENCE HENDRIX L.L.C., a Washington Limited Liability Company, and Authentic Hendrix L.L.C., a Washington Limited Liability Company, Plaintiffs-Appellants/Cross-Appellees, v. HENDRIXLICENSING.COM LTD, a Nevada Corporation, DBA Hendrix Artwork, dba Hendrixartwork.com; Andrew Pitsicalis, an individual; CHRISTINE RUTH FLAHERTY, Defendants-Appellees/Cross-Appellants.
Nos. 11-35858, 11-35872.
United States Court of Appeals, Ninth Circuit.
Filed Jan. 29, 2014.
Amended Aug. 8, 2014.
762 F.3d 829
Argued and Submitted March 7, 2013.
Thomas T. Osinski, Jr., Osinski Law Offices, P.L.L.C., Tacoma, WA, for Defendants-Appellees/Cross-Appellants.
Duncan Crabtree-Ireland and Danielle Van Lier, Screen Actors Guild, Inc., Los Angeles, CA, for Amicus Curiae Screen Actors Guild, Inc., American Federation of Television & Radio Artists, AFL-CIO, Luminary Group LLC, and the Estate of Marilyn Monroe, LLC.
Before: DAVID M. EBEL,* WILLIAM A. FLETCHER, and JOHNNIE B. RAWLINSON, Circuit Judges.
* The Honorable David M. Ebel, Senior Circuit Judge for the United States Court of Appeals for the Tenth Circuit, sitting by designation.
ORDER AND AMENDED OPINION
ORDER
The Opinion filed January 29, 2014, appearing at 742 F.3d 377, is amended sua sponte to remove footnote 6.
A copy of the our amended decision and original concurrence is attached to this Order and filed concurrently with this Order.
With this amendment, the panel has voted unanimously to DENY the petition for REHEARING and the petition for REHEARING EN BANC. The full court has been advised of the petition for rehearing en banc, and no judge has requested a vote on whether to rehear the matter.
The petition for rehearing and the petition for rehearing en banc are DENIED. No further petitions for panel rehearing or for rehearing en banc will be entertained.
OPINION
EBEL, Circuit Judge:
This litigation stems from a dispute over the commercial use of a deceased celebrity‘s image, likeness, and name. The sole heir of deceased rock legend Jimi Hendrix formed two companies, Plaintiffs Experience Hendrix, L.L.C., and its wholly owned subsidiary, Authentic Hendrix, L.L.C. (collectively “Experience Hendrix“). Among other things, Experience Hendrix owns trademarks that it uses to sell and license products related to Jimi Hendrix. In this litigation, Experience Hendrix succeeded on its claims alleging that Defendants Andrew Pitsicalis and his company, Hendrixlicensing.com, L.L.C. (collectively “Pitsicalis”1), were licensing Hendrix-re
For his part, Pitsicalis sought a declaratory judgment declaring that a third statute, Washington‘s
I. Background
Experience Hendrix holds a number of trademarks associated with Jimi Hendrix, including the names “Hendrix” and “Jimi Hendrix” and Jimi Hendrix‘s signature, as well as logos incorporating a “headshot” of Hendrix. Experience Hendrix uses these trademarks to market, sell and license Hendrix-related merchandise, including apparel, posters, and artwork sold to the public through Internet websites and brick-and-mortar retail stores throughout the United States, including the state of Washington.
Pitsicalis has also used Jimi Hendrix‘s celebrity status commercially. Pitsicalis owns, or has licenses to use, photographs and original pieces of art depicting Hendrix, as well as visual artwork created by Hendrix himself. In 2008, Pitsicalis began licensing the right to use these images to produce and sell Hendrix-related merchandise, including apparel, posters and household items. Like Experience Hendrix, Pitsicalis‘s licensees sold this merchandise over the Internet and in brick-and-mortar stores. Pitsicalis placed marks on his licensed products that used the names “Hendrix” and “Jimi Hendrix,” as well as Jimi Hendrix‘s signature and a logo of Hendrix‘s headshot with a guitar. In conducting his business, Pitsicalis also used two websites with the domain names hendrixlicensing.com and hendrixartwork.com.
In March 2009, Experience Hendrix sued Pitsicalis under two statutes. First, Experience Hendrix alleged that Pitsicalis was infringing Experience Hendrix‘s trademarks in violation of the federal
Pitsicalis, in turn, asserted counterclaims against Experience Hendrix, seeking a judgment declaring that a third statute, Washington‘s
II. DISCUSSION
We address first Pitsicalis‘s counterclaims regarding the WPRA, before turning to Experience Hendrix‘s claims.
A. Jimi Hendrix‘s post-mortem publicity rights under the WPRA
1. Standing
Through his counterclaims, Pitsicalis sought a judgment declaring that 1) the WPRA “does not apply to publicity rights in Jimi Hendrix” and, therefore, 2) “it is possible to trade in original images and likenesses of Jimi Hendrix without creating a per se infringement of Experience [Hendrix‘s] trademark rights.” As a threshold matter, Experience Hendrix contends that Pitsicalis lacks Article III standing to assert these declaratory judgment claims.
However, there is no doubt that an actual controversy exists between Pitsicalis and Experience Hendrix under the federal
It is within this same litigation that Pitsicalis sought a judgment declaring that, under the WPRA, Experience Hendrix has acquired from Jimi Hendrix no post-mortem publicity rights, which Experience Hendrix could use to sue or threaten to sue Pitsicalis and his licensees, customers and potential customers. Experience Hendrix has in fact previously asserted Jimi Hendrix‘s publicity rights, albeit under an earlier version of the WPRA, in prior litigation which resulted in a final ruling that the initial version of the WPRA was inapplicable to Jimi Hendrix. That ruling was based upon choice-of-law principles which required application of New York law. New York was the domicile of Jimi Hendrix at the time of his death and it did not recognize these post-mortem rights. Experience Hendrix, LLC v. Electric Hendrix, LLC, No. C07-0338 TSZ, 2008 WL 3243896, at *2-*4 (W.D.Wash. Aug. 7, 2008) (unreported).
In 2008, however, the Washington legislature amended the WPRA to apply it “to all individuals and personalities, living and deceased, regardless of place of domicile or place of domicile at time of death.”
The record here does not reveal any evidence that Experience Hendrix has explicitly threatened Pitsicalis, or his licensees, customers or potential customers with suit under the amended WPRA. But Pitsicalis alleged that Experience Hendrix, relying on rights that go beyond its federally protected trademarks, interfered with the sale, by one of Pitsicalis‘s licensees to the retailer Spencer‘s Gifts, of Pitsicalis-licensed Hendrix-related merchandise that did not infringe Experience Hendrix‘s trademarks.3 In light of all of these circumstances, Pitsicalis has a sufficiently legitimate concern that Experience Hendrix will renew its efforts to assert rights under the amended WPRA against Pitsicalis and related parties, given Experience Hendrix‘s past aggressive assertion of its rights related to Jimi Hendrix, and given the 2008 amendment to the WPRA that removes the previous impediment to Experience Hendrix‘s judicial efforts to enforce Jimi Hendrix‘s post-mortem publicity rights under that Act. See Rhoades v. Avon Prods., Inc., 504 F.3d 1151, 1157-58 & 1157 n. 4 (9th Cir.2007) (noting that, under the Ninth Circuit‘s “reasonable apprehension” test, concrete or explicit threats of litigation are not necessary for a plaintiff to have standing).
2. The WPRA is constitutional as applied to the narrow set of non-speculative circumstances at issue here
The parties do not dispute that the amended WPRA recognizes post-mortem personality rights belonging to Jimi Hendrix, notwithstanding that 1) he died in 1970, before Washington originally enacted the WPRA; 2) he was domiciled in New York at the time of his death; and 3) New York law does not recognize a post-mortem right of publicity that would survive Jimi Hendrix‘s death and descend to his heir. The parties also do not dispute that, under the WPRA, Experience Hendrix owns Jimi Hendrix‘s post-mortem personality rights. Notwithstanding that the WPRA thus on its face provides Experience Hendrix with Jimi Hendrix‘s post-mortem personality rights, the district
The narrow, non-speculative WPRA controversy before us, as Pitsicalis has alleged it, involves only (1) Pitsicalis‘s “reasonable apprehension” that Experience Hendrix will use the WPRA to stop his attempts to license unofficial Hendrix-related products for sale in Washington, and (2) Pitsicalis‘s licensee‘s unsuccessful attempt to introduce into Washington, through his licensee‘s dealings with Spencer‘s Gifts, Pitsicalis-licensed goods that bore Hendrix‘s image and likeness, but that did not carry marks that infringed Experience Hendrix‘s trademarks.
Washington‘s approach to post-mortem personality rights raises difficult questions regarding whether another state must recognize the broad personality rights that Washington provides. But we need not resolve that issue. Here, the limited controversy before us, as Pitsicalis has alleged it, involves only Experience Hendrix‘s interference with the sale in Washington of Pitsicalis-licensed, unofficial but non-infringing goods bearing Hendrix‘s likeness, as well as Pitsicalis‘s “reasonable apprehension” that Experience Hendrix will attempt to stop such targeted sales in Washington in the future.4
a. Due Process/Full Faith and Credit Clauses
The district court held that applying Washington‘s WPRA here, instead of the law of New York, the state where Jimi Hendrix was domiciled at the time of his death, violated choice-of-law principles protected by the Due Process and Full Faith and Credit Clauses of the U.S. Constitution. Those Clauses require that, “for a State‘s substantive law to be selected [and applied to a particular case] in a constitutionally permissible manner, that State must have a significant contact or significant aggregation of contacts, creating state interests, such that choice of its law is neither arbitrary nor fundamentally unfair.” Allstate Ins. Co. v. Hague, 449 U.S. 302, 312-13, 101 S.Ct. 633, 66 L.Ed.2d 521 (1981).5
Washington has sufficiently significant contacts with the actual, non-speculative controversy at issue here, which involves the loss of sales in Washington of Pitsicalis-licensed goods. Therefore, because these contacts are sufficient to give Washington an interest in applying its own law to this controversy, it is not arbitrary or unfair to apply the WPRA here. See id.; see also AT & T Mobility LLC v. AU Optronics Corp., 707 F.3d 1106, 1111 (9th Cir.2013) (noting that ”Allstate places only ‘modest restrictions on the application of forum law,’ and most commentators have viewed Allstate as setting a highly permissive standard” (internal citation omitted)).
The district court also held that applying the WPRA to this case would violate the dormant Commerce Clause, which limits the power of states to enact laws imposing substantial burdens on interstate commerce. See Nat‘l Ass‘n of Optometrists & Opticians v. Harris, 682 F.3d 1144, 1148-50 (9th Cir.2012). The district court reasoned that, although the WPRA does not discriminate against out-of-state interests, to apply the WPRA to the controversy at issue here would, nevertheless, give the WPRA an impermissible extraterritorial reach, encompassing “a variety of transactions occurring ‘wholly outside’ Washington‘s borders.” However, the limited, non-speculative controversy at issue here, does not affect transactions occurring wholly outside Washington. Cf. Am. Trucking Ass‘ns, Inc. v. Mich. Pub. Serv. Comm‘n, 545 U.S. 429, 434 (2005) (holding Michigan‘s flat tax on activities taking place exclusively within that state did not violate the dormant Commerce Clause). Nor does the record suggest that the application of the WPRA to the limited, non-speculative controversy at issue here would otherwise impermissibly burden interstate commerce. See id. at 434-38.
3. Conclusion as to Pitsicalis‘s declaratory judgment claims
For the foregoing reasons, we conclude that the WPRA can be applied constitutionally to the narrow controversy at issue here. We, therefore, reverse the district court‘s decision to grant Pitsicalis summary judgment on his declaratory judgment claims and we remand those claims to the district court with instructions for the district court to enter summary judgment in favor of Experience Hendrix. See Gospel Missions of Am. v. City of Los Angeles, 328 F.3d 548, 553 (9th Cir.2003) (“Even when there has been no cross-motion for summary judgment, a district court may enter summary judgment sua sponte against a moving party if the losing party has had a full and fair opportunity to ventilate the issues involved in the matter.” (internal quotation marks omitted)).
B. Trademark infringement and deceptive trade practices
We turn now to the claims Experience Hendrix asserted against Pitsicalis. Experience Hendrix‘s claims against Pitsicalis are premised on allegations that Pitsicalis infringed several of Experience Hendrix‘s trademarks related to Jimi Hendrix. Experience Hendrix asserted trademark infringement claims under two different statutes. First, Experience Hendrix brought a claim under the federal Lanham Act specifically alleging trademark infringement. The district court ultimately ruled as a matter of law that Pitsicalis had in fact infringed several of Experience Hendrix‘s trademarks.
Second, Experience Hendrix brought a claim against Pitsicalis under the
On appeal, Pitsicalis challenges only one aspect of the district court‘s conclusion that he is liable for infringing Experience Hendrix‘s trademarks: Pitsicalis argues that his domain names hendrixlicensing.com and hendrixartwork.com did not violate the federal Lanham Act by infringing Experience Hendrix‘s trademark “Hen
Experience Hendrix sought several remedies to redress Pitsicalis‘s infringing conduct under both the federal
Experience Hendrix also sought damages, under both the federal
Finally, Experience Hendrix requested an award of attorney‘s fees in the amount of over $500,000. The district court awarded a much smaller amount, $50,000. Experience Hendrix challenges the court‘s denial of much of its attorney fee request. We vacate the fee award and remand for the district court‘s reconsideration because many of the factors on which the district court based its attorney fee decision have now changed.
1. Pitsicalis‘s liability under the federal Lanham Act for using domain names that infringed Experience Hendrix‘s trademark “Hendrix”
The district court granted Experience Hendrix partial summary judgment, concluding Pitsicalis had infringed several of Experience Hendrix‘s trademarks. On appeal, Pitsicalis challenges only one aspect of that ruling, arguing that the district court erred in determining that his domain names, hendrixlicensing.com and hendrixartwork.com, infringed Experience Hendrix‘s trademark “Hendrix.” We review that determination de novo. See Lopez-Valenzuela, 719 F.3d at 1059.
Pitsicalis defended his use of the trademark “Hendrix” in his domain names
2. Paragraph 5 of the permanent injunction is inadequate
After concluding that Pitsicalis infringed several of Experience Hendrix‘s trademarks, the district court issued injunctive relief under the
Briefly summarized, paragraph 1(iii)-(iv) of the challenged injunction permanently enjoins Pitsicalis from using Pitsicalis‘s “‘guitar and headshot’ logo or any similar mark, brand, or logo,” and from using the Jimi Hendrix signature set forth in the injunction, “or any similar signature, mark, brand, or logo.” But then, contrary to that provision, the first sentence in the challenged Paragraph 5 states that “[n]othing in this Permanent Injunction shall be construed as enjoining, prohibiting, or otherwise inhibiting [Pitsicalis] or any other entity or person from creating, reproducing, advertising, distributing, selling, or otherwise commercially trading in images or likenesses of Jimi Hendrix.” These two provisions appear to be in some conflict or at least are ambiguous when read together. Thus, in this particular, the injunction does not clearly state what conduct is and is not restrained. We, therefore, vacate the permanent injunction and remand to the district court to revise the permanent injunction in order to clarify what conduct is and is not restrained.
We reject Experience Hendrix‘s challenges to the rest of Paragraph 5. The second sentence of Paragraph 5 states that “[t]he Court makes no ruling concerning whether ... images or likenesses [of Jimi Hendrix] might be otherwise protected by copyright laws.” The district court did not abuse its discretion in including this language in the permanent injunction, see Skydive Ariz., Inc. v. Quattrocchi, 673 F.3d 1105, 1110 (9th Cir.2012), because this language only clarified that the district court had not ruled on any possible infringement of Experience Hendrix‘s copyrights because Experience Hendrix never alleged a copyright claim. See id. at 1116 (“An injunction should be tailored to
The third and final sentence of Paragraph 5 states that “nothing in this Permanent Injunction shall be construed as enjoining, prohibiting, or otherwise inhibiting Defendants or any other entity or person from using the names or marks ‘Jimi Hendrix’ or ‘Hendrix’ to identify the subject of an associated image or the author or creator of an associated work of art.” This language does not conflict with the injunction‘s earlier language specifically precluding Pitsicalis from using “Hendrix” in his business and domain names. Nor does this third sentence, contrary to Experience Hendrix‘s argument, affirmatively permit Pitsicalis or anyone else to infringe Experience Hendrix‘s trademarks “Hendrix” and “Jimi Hendrix.” Instead, this language accurately indicates that the district court never ruled on Experience Hendrix‘s claims, abandoned in the district court, which alleged that Pitsicalis‘s use of the names “Hendrix” and “Jimi Hendrix” to describe the images Pitsicalis used in his unofficial Hendrix-related products infringed Experience Hendrix‘s trademarks “Hendrix” and “Jimi Hendrix.” In this regard, the district court again properly limited the terms of the injunction to the specific claims before it, and then only to those claims on which Experience Hendrix prevailed. See Skydive Ariz., 673 F.3d at 1116; see also Toyota Motor Sales, U.S.A., Inc. v. Tabari, 610 F.3d 1171, 1176 (9th Cir.2010) (noting that court must tailor injunction “to eliminate only the specific harm alleged“) (quoting E. & J. Gallo Winery v. Gallo Cattle Co., 967 F.2d 1280, 1297 (9th Cir.1992)); cf. Aspex Eyewear, Inc. v. Marchon Eyewear, Inc., 672 F.3d 1335, 1344 (Fed.Cir.2012) (noting, in patent infringement case, the frequent admonishment that district courts are “not to issue sweeping injunctions against potentially infringing activities ..., but to restrict the scope of the injunction to the particular adjudicated infringing activity“).
In sum, the first sentence in Paragraph 5 of the permanent injunction—stating that “[n]othing in this Permanent Injunction shall be construed as enjoining, prohibiting, or otherwise inhibiting Defendants or any other entity from creating, reproducing, advertising, distributing, selling, or otherwise commercially trading in images or likenesses of Jimi Hendrix“—conflicts with the earlier provisions of the injunction restraining Pitsicalis from using a Jimi Hendrix “guitar and headshot” logo or any similar mark, brand or logo. We, therefore, vacate the permanent injunction and remand to the district court to clarify what conduct is and is not enjoined.
3. Damages under both the federal Lanham Act and the WCPA
In addition to seeking an injunction permanently enjoining Pitsicalis from infringing Experience Hendrix‘s trademarks, Experience Hendrix also sought damages to compensate it for Pitsicalis‘s past infringement. There are two related issues involving damages that we must address, one involving the district court‘s order entering a greatly reduced damages award under
The second issue regarding damages involves the same damages awards, but this time under
a. Overview of the jury‘s award of damages under the federal Lanham Act and the WCPA
Based on Pitsicalis‘s infringing Experience Hendrix‘s trademarks in violation of the
Finding that this same trademark infringement also amounted to an unfair or deceptive trade practice under the WCPA, the jury further awarded Experience Hendrix a total of $1,356,650 in damages under that statute. The WCPA award represented apparently the same $306,650 in lost profits for Experience Hendrix as a result of Pitsicalis‘s unfair trade practices, $750,000 for injury to Experience Hendrix‘s reputation, and $300,000 for Experience Hendrix‘s loss of goodwill.
After the jury‘s verdict, the district court granted Pitsicalis‘s
At first glance, our resolution—first reinstating the jury‘s damages award and then affirming the district court‘s decision to have a new trial on damages—may seem contradictory. But our decision is consistent with the differing standards that governed the district court‘s consideration of Pitsicalis‘s
In considering a
Unlike with a
With these different legal standards in mind, we consider first the district court‘s
b. The district court erred in striking under Fed.R.Civ.P. 50(b)(3) most of the damages awarded by the jury
To recap, the district court, acting under
i. The jury‘s damages award for Experience Hendrix‘s lost profits
For the amount of profits Experience Hendrix lost as the result of Pitsicalis‘s infringing conduct, the jury returned two identical awards of $306,650, one under the federal Lanham Act and one under the WCPA.11 On appeal, no one contends that a different analysis applies to the calculation of lost profits under the WCPA than applies under the federal Lanham Act. In fact, “the parties already stipulated that [lost profits under the WCPA] are the same as the Lost Profits under the Lanham Act for the purposes of awarding double recovery.” Therefore, we address here the jury‘s identical awards for lost profits under the Lanham Act and the WCPA together. In doing so, we conclude that, under the circumstances of this case and in light of our standard of review, the evidence was sufficient to permit a reasonable jury to calculate the profits Experience Hendrix lost due to Pitsicalis‘s infringing conduct. See Skydive Ariz., 673 F.3d at 1112 (“In a trademark action, the nature of the proof required to support a jury award depends on the circumstances of the case....“).12
The district court instructed jurors that they were to calculate profits “by deducting all expenses from gross revenue.” It was Experience Hendrix‘s burden to prove its damages. See Lindy Pen Co. v. Bic Pen Corp., 982 F.2d 1400, 1407 (9th Cir. 1993) (applying
During the jury instruction conference, after the close of evidence, Experience Hendrix acknowledged that it had not presented the jury with any evidence of its expenses. This was because Experience Hendrix mistakenly believed that it bore the burden of proving only its lost revenue and that, once it had made that showing, the burden shifted to Pitsicalis to prove any expenses that jurors should deduct in order to calculate Experience Hendrix‘s lost profits. The Lanham Act applies this burden-shifting framework to proof of the defendant infringer‘s lost profits. See
Notwithstanding Experience Hendrix‘s confusion as to the burdens of proof, there was sufficient evidence before the jurors from which they could calculate the profits Experience Hendrix lost due to Pitsicalis‘s infringing conduct. That evidence included the following: There was undisputed evidence that, at the same time that Pitsicalis was licensing his infringing goods, Experience Hendrix suffered a significant decline in its own licensing revenue earned from products similar to Pitsicalis‘s infringing merchandise. There was also testimony describing the nature of licensing revenue generally as a licensee‘s payment to the licensor of a percentage of the licensee‘s revenue in return for the use of the licensor‘s intellectual property. In addi
ii. The jury‘s damages award for Experience Hendrix‘s loss of goodwill and reputation
The jury also awarded Experience Hendrix $750,000 in damages for harm Pitsicalis caused to its reputation and $300,000 for the loss of goodwill. The jury awarded these measures of damages only under the WCPA. See Wash. State Physicians Ins. Exch. & Ass‘n v. Fisons Corp., 122 Wash.2d 299, 858 P.2d 1054, 1063 (1993) (en banc) (“[D]amage to business reputation and loss of goodwill are [also] compensable damages under the [W]CPA.“). The district court, in granting Pitsicalis‘s
There was significant evidence to support the jury‘s finding of the fact that Pitsicalis‘s deceptive trade practices injured Experience Hendrix‘s reputation and goodwill. As to the amount of that harm, the jury had evidence regarding the total licensing revenue that Experience Hendrix earned during the period of time before and during Pitsicalis‘s infringing activity. From this information, jurors could have calculated the amount of harm Pitsicalis caused to Experience Hendrix‘s business reputation and goodwill “with reasonable certainty.” Lewis River Golf, Inc. v. O.M. Scott & Sons, 120 Wash.2d 712, 845 P.2d 987, 990 (1993) (en banc); see Wash. State Physicians, 858 P.2d at 1071 (“Damages for loss of professional reputation are not the type of damages which can be proved with mathematical certainty and are usually best left as a question of fact for the jury.“) Specifically, this evidence indicated that Experience Hendrix‘s overall licensing revenue declined by $1,022,351.70 during 2009, the period during which Pitsicalis was infringing Experience Hendrix‘s trademarks. That information provided a legally sufficient basis for the jury‘s award of a total of $1,050,000 in damages for harm to Experience Hendrix‘s reputation and goodwill,14 and thus permitted these damage awards to survive Pitsicalis‘s
c. The district court did not abuse its discretion in conditionally granting Experience Hendrix a new trial on damages
The district court conditionally granted Pitsicalis a new trial on damages under both the federal
The district court can grant a new trial under
i. New trial on damages for lost profits
The district court concluded that the jury‘s damages award of $306,650, representing the profits Experience Hendrix lost as the result of Pitsicalis‘s infringement of Experience Hendrix‘s trademarks, was against the clear weight of the evidence. Briefly stated, the district court was not convinced that the references on Experience Hendrix‘s Exhibit 60 to “total income,” “gross profits,” “net ordinary income,” and “net income” should be equated to profits, without further evidence indicating that there were, in fact, no expenses that should be deducted from Experience Hendrix‘s licensing revenue before it is deemed a measure of lost profits. This determination alone might not have been sufficient to support the district court‘s decision to grant a new trial on damages. See Ace v. Aetna Life Ins. Co., 139 F.3d 1241, 1248 (9th Cir.1998) (recognizing that a more stringent standard of review applies to grants of new trials predicated on insufficiency of the evidence). But the district court also disbelieved the testimony of one of Experience Hendrix‘s corporate officers, Robert Hendrix, that 77% of Experience Hendrix‘s drop in licensing revenues during the relevant time period, 2009, was the result of Pitsicalis‘s infringing products and not attributable to the general market economic downturn that occurred during this same time period. The district court based its credibility determination in part on the fact that Experience Hendrix‘s licensing revenues on its other products, which would not have been affected by Pitsicalis‘s infringing goods, fell by more than 23% during this same time. We cannot say that the district judge, who heard the evidence presented at trial, abused its discretion in ordering a new trial on lost profits on these bases.16
ii. New trial on damages for loss of reputation and goodwill
As previously stated, the jury awarded Experience Hendrix, under the WCPA, $750,000 for harm to its reputation and $300,000 for the loss of goodwill. The district court granted a new trial on these damages as well, concluding that these damage awards were both contrary to the clear weight of the evidence and contrary to the district court‘s instruction to the jury that these measures of damages were “essentially the same thing.”
Moreover, reading the court‘s supplemental instruction in light of the district court‘s instructions as a whole, jury confusion appears likely. See Overseas Private Inv. Corp. v. Metro. Dade Cnty., 47 F.3d 1111, 1116 (11th Cir.1995) (granting new trial on damages where jury instructions were confusing, resulting in a confusing damages award). The court‘s original instructions told jurors to consider these two measures of damages separately, and the verdict form provided separate places to insert damages for loss of reputation and damages for loss of goodwill. The court further instructed jurors to award each measure of damages to which they found Experience Hendrix was entitled, without regard to whether any award was duplicative, because the court would later correct any duplication of damages. And when, during the jury‘s deliberations, the court told jurors that harm to reputation and loss of goodwill were “essentially the same thing,” the court also reminded jurors that all of the court‘s previous instructions, including the instruction to consider each measure of damages separately, remained important. These instructions, considered together, likely fostered confusion among jurors.
Based on the minimal evidence of the amount of harm Pitsicalis‘s infringing activity caused to Experience Hendrix‘s reputation and goodwill, the fact that the jury‘s award of two different amounts for these damages directly contradicted the court‘s supplemental jury instruction that these measures of damages were “essentially the same,” and the confusion likely created by the instructions as a whole, we cannot say that the district court abused its discretion in granting a new trial on these measures of damages.
iii. Duplication of damages awards
In addition to the district court‘s concerns about the damages awards, we also have concerns about the duplicative nature of several of the awards. Those apparent duplicative awards include damages, under the Lanham Act, for both Pitsicalis‘s profits earned from infringing Experience Hendrix‘s trademarks and Experience Hendrix‘s profits lost due to Pitsicalis‘s infringing activity; an award of Experience Hendrix‘s lost profits under both the Lanham Act and the WCPA; and an award of lost licensing revenue specifically for Experience Hendrix‘s goods that are similar to Pitsicalis‘s infringing merchandise, which appears to have been double-counted as part of the total award for lost reputation and goodwill. The district court instructed jurors to consider and award each measure of damages to which Experience Hendrix was entitled, without regard to the duplicative nature of any of the awards, because the trial court would later eliminate any duplication. Here, however, other than the two identical lost profit awards under the Lanham Act and the WCPA, the district court did not address any possible duplication of remedies. While we have discretion to remand for
iv. Conclusion as to new trial
For the foregoing reasons, then, we uphold the district court‘s decision to order a new trial on damages, other than the $60,000 in damages on Pitsicalis‘s profits for trademark infringement under the Lanham Act.17 Our decision is bolstered by the conclusion that a new trial on these measures of damages would be just under these circumstances. Experience Hendrix‘s supporting evidence underlying each of these measures of damages, while providing a legally sufficient basis to survive a
4. Attorney‘s fees under the WCPA
Finally, the district court awarded Experience Hendrix attorney‘s fees under the WCPA, see
III. CONCLUSION
For the foregoing reasons, we REVERSE the district court‘s determination that Washington‘s Personality Rights Act is unconstitutional and REMAND Pitsicalis‘s declaratory judgment claims pertaining to the WPRA with instructions to enter summary judgment on those claims in favor of Experience Hendrix. We AFFIRM the district court‘s decision granting Experience Hendrix partial summary judgment on its claim that Pitsicalis‘s use of “Hendrix” in its domain names infringed Experience Hendrix‘s mark “Hendrix.” We VACATE the permanent injunction and REMAND so the district court can revise language in the injunction to clarify what conduct is and is not enjoined. We REVERSE in its entirety the district court‘s
AFFIRMED IN PART, REVERSED IN PART, VACATED IN PART AND REMANDED.
RAWLINSON, Circuit Judge, concurring in part and dissenting in part:
I concur in much of the majority‘s opinion. I agree with the majority‘s conclusion that the district court erred when it determined that the Washington Personality Rights Act (WPRA) is unconstitutional. I also agree that the district court correctly determined that Defendant Pitsicalis‘s use of “Hendrix” infringed Experience Hendrix‘s “Hendrix” mark. I concur in the determination that the permanent injunction should be vacated and remanded for clarification of precisely what conduct is permanently enjoined. In addition, I join the majority‘s conclusion that the jury‘s damages award was improperly decreased
Although there is much of the majority opinion with which I agree, I absolutely and positively disagree with the majority‘s conclusion that a new trial is warranted on the issue of damages. In my view, the majority opinion on this point, like the district court decision, strays from the appropriate standard of review and essentially re-tries the case. I respectfully dissent from that portion of the majority opinion.
It is helpful at the outset to outline the standard of review that governed the district court‘s decision and governs our review of that decision. That standard of review authorizes a new trial only if the record contains no evidence in support of the jury‘s verdict. See E.E.O.C. v. Go Daddy Software, Inc., 581 F.3d 951, 962 (9th Cir.2009). This standard incorporates considerable deference to the jury‘s determination. See Kode v. Carlson, 596 F.3d 608, 612 (9th Cir.2010) (per curiam). The majority opinion adheres to this standard when resolving Pitsicalis‘s motion for judgment as a matter of law, but completely abandons this standard when considering Pitsicalis‘s motion for a new trial.
As the majority acknowledges, the determination that sufficient evidence supported the jury verdict for the purposes of Pitsicalis‘s
It cannot be disputed that damages evidence was presented for the jury‘s con
Referring to a trial exhibit, Robert pointed out the dramatic decrease in royalties from one licensee in 2008-09 to demonstrate the extent of the damages caused by Pitsicalis‘s infringement. In 2006, Experience Hendrix received $384,000 in royalties from the licensee. In 2007, Experience Hendrix was paid $394,000 in royalties. Royalties decreased to $262,000 in 2008, and plummeted to $40,000 in 2009. Robert also described decreased royalties from five licensee companies in his testimony: “I did $514,000 in 2008, and in 2009, I did $116,000 of licensing of merchandising from these five companies. That‘s almost a $400,000 drop in revenue.”
In response to the suggestion that the decreased royalties were attributable to the recession, Robert noted that historically Experience Hendrix had “maintained” its sales numbers during the previous recession, when other licensors of trademarked items were experiencing a decrease in sales due to the recession. For that reason, Robert did not attribute the dramatic decrease in royalties to the recession.
Robert also testified that its licensees were unable to sell merchandise in brick and mortar stores such as J.C. Penney in 2009, once Pitsicalis had flooded the store shelves with infringing merchandise. This testimony was consistent with the dramatic decrease in royalty payments in 2009, after Experience Hendrix realized increased royalties “every single year until 2008.” Robert Hendrix estimated that approximately seventy-seven percent of the decrease in royalties was attributable to Pitsicalis‘s infringing activity.
Richard Hendrix‘s testimony was corroborated by Richard Yalch, Experience Hendrix‘s expert witness, and a thirty-seven-year Ph.D. professor of marketing at the University of Washington. Dr. Yalch confirmed that lost royalties due to Pitsicalis‘s infringing sales constituted damages to Experience Hendrix.
Despite this unrefuted testimony, the district court and the majority have concluded that the jury‘s award of damages was against the weight of the evidence. Yet, the majority acknowledges this undisputed evidence of the significant decline in Experience Hendrix‘s licensing revenue and concedes that this evidence was sufficient to allow the jury to calculate Experience Hendrix‘s lost profits. See Majority Opinion, pp. 843-44. The majority‘s acknowledgment simply cannot be reconciled with the standard of review we must apply to the district court‘s ruling. See United States v. 4.0 Acres of Land, 175 F.3d 1133, 1139 (9th Cir.1999) (noting that a district court abuses its discretion in granting a new trial “if the jury‘s verdict is not against the clear weight of the evidence“) (citation omitted); see also Ace v. Aetna Life Ins. Co., 139 F.3d 1241, 1248 (9th Cir.1998), as amended (explaining that a jury verdict may be set aside on the basis of insufficient supporting evidence only if it “is against the great weight of the evidence or it is quite clear that the jury has reached a seriously erroneous result“) (citations omitted) (emphases added). We have characterized this standard as “stringent.” Id. (citation omitted).
According to the majority, the district court did not believe Robert Hendrix‘s testimony regarding Experience Hendrix‘s lost revenue. See Majority Opinion, p.
The majority also concludes that a new trial is warranted due to the confusing jury instructions. See Majority Opinion, pp. 846-47. The majority opinion focuses on the instruction from the district court that damages for injury to reputation and loss of goodwill “were essentially the same thing.” Id. (internal quotation marks omitted). But “essentially the same thing” and “exactly the same thing” are different concepts. And the jury could have reasonably awarded damages for injury to reputation and loss of goodwill under the district court‘s instruction. See WMX Technologies v. Miller, Inc., 197 F.3d 367, 374 (9th Cir.1999) (“Reputation is not the equivalent of the goodwill of a business....“) (emphasis added); id., (“[T]he goodwill of a business is its value as a going concern ...“). Robert Hendrix‘s testimony established that Pitsicalis‘s infringement not only damaged Experience Hendrix‘s reputation for providing authentic Jimmy Hendrix items, but also decreased the value of Experience Hendrix as a going concern. See id.
The majority concludes that a new trial is warranted due to “likely” jury confusion stemming from the district court‘s instructions. See Majority Opinion, pp. 846-47. However, as discussed above, the jury‘s verdict was supported by the evidence and consistent with the court‘s instruction. In any event, as the majority recognizes, to the extent the damages award is duplicative, we could remand for correction of the award rather than requiring a new trial. See Majority Opinion, pp. 847-48.
In sum, applying the proper standard should result in retention of the jury‘s verdict, including the award of damages. This might be a different case if Pitsicalis had submitted some evidence to refute the damages evidence submitted by Experience Hendrix. However, in the absence of countervailing evidence from Pitsicalis, there was nothing for the district court to weigh when deciding the motion for a new trial. All the evidence was on Experience Hendrix‘s side of the scale, and supported the jury‘s verdict. For that reason, I would reverse the district court‘s grant of a new trial. See DSPT Int‘l Inc. v. Nahum, 624 F.3d 1213, 1218 (9th Cir.2010) (“A district court may grant a new trial only if the jury verdict is contrary to the clear weight of the evidence.... A jury‘s verdict must be upheld if it is supported by substantial evidence, which is evidence adequate to support the jury‘s conclusion, even if it is also possible to draw a contrary conclusion.... A jury verdict should be set aside only when the evidence permits only one reasonable conclusion, and that conclusion is contrary to the jury‘s verdict.“) (footnote references and internal quotation marks omitted).1
As for the attorney‘s fees, I agree with the majority that the fee award should be vacated and remanded, but not for the reasons stated by the majority. Because I
CONCLUSION
I agree with the majority that we should reverse the district court‘s ruling that the WPRA is unconstitutional. I also concur in the affirmance of the district court‘s decision granting summary judgment to Experience Hendrix on its infringement claims against Pitsicalis‘s use of the “Hendrix” marks. I concur in the vacatur and remand of the permanent injunction. I join the majority in reversing the district court‘s decision to decrease the damages awarded by the jury. I also join the majority‘s vacatur of the attorney fee award. I differ from the majority in that I would NOT remand for a new trial on damages. I would remand for reinstatement of the damages awarded by the jury, and for an award of attorney‘s fees to Experience Hendrix as the prevailing party. In short, the district court should reinstate the jury‘s verdict, award attorney‘s fees to Experience Hendrix, and let this case be done.