Facts

In this federal trademark infringement action tried before a jury, plaintiff Dora Diaz and defendant Marlene Prada Bautista each sought to prove prior use in the United States of their respective trademarks. The parties stipulated prior to trial that the parties' respective marks, Fajate for Diaz and Fájate for Prada, infringed one another and that the rightful owner in the United States would be the party who showed priority of actual use of the mark in the United States. The only difference between the marks is the accent over the first "a" in Prada's Fájate mark.

Diaz owns a federally registered trademark Fajate for shapewear including girdles. She began to use the trademark in the first half of 2000. Prada and her twin sister Yolanda designed the trademark Fájate in Medellin, Colombia in the second half of 2004. Both Prada and her sister began to sell shapewear in Colombia using the Fájate trademark in the second half of 2004.

Diaz's husband Ricardo Candamil attended a tradeshow in the second half of 2005 in Colombia and observed a booth operated by Prada's company selling shapewear using the trademark Fájate. Upon his return to the United States, he discussed with Diaz the fact that someone else was using the trademark in Colombia. Neither Diaz nor her husband spoke English. However, their son Sebastian spoke English and he was given the task of registering Diaz's trademark in the United States Patent and Trademark Office. He inadvertently filed the application as an intent-to-use application rather than a use-based application. He had a telephone interview with the trademark Examining Attorney in the Patent and Trademark Office who explained to him how to correct the application to allege a first-use date in June 2000. Thereafter, the application matured into registration in April 2007.

Prada began to establish a distribution network in the United States and began to sell to her first distributor in the United States, Maria Cuervo, in mid-2006. Prada also began to distribute through a distributor Nelly Santamaria in mid-2009.

In May 2009, Diaz's telephone sales persons began to receive telephone orders from customers referencing non-Diaz style numbers. She and her son Sebastian began to investigate and determined that customers of Cuervo and Santa Maria were ordering shapewear from Diaz mistakenly believing that Diaz was the source of shapewear imported and distributed by Prada's United States distributors. Diaz had her attorney send cease-and-desist letters to Cuervo, Santamaria, and several other distributors, including defendants Martha Angulo and Consuelo Mejia. None of them discontinued importing Prada's Fájate shapewear.

Diaz filed a complaint in 2010 for federal trademark infringement and unfair competition against Prada, Cuervo, Santamaria, Angulo and Mejia.

Prada filed an answer and a counterclaim against Diaz and Candamil for trademark infringement.

Cuervo and Santa Maria answered the complaint by denying infringement.

Angulo and Mejia did not answer and eventually default judgments in the amount of $5,000 each were obtained against them.

At the trial, Diaz offered the testimony of herself, her husband and son as well as six non-family witnesses to prove that she began to use her trademark in the first half of 2000. Prada sought to prove that the nine witnesses offered by Diaz were not credible and that Diaz's husband Candamil stole the trademark from Prada when he observed Prada's company displaying products using the trademark Fájate at the tradeshow in Colombia in the second half of 2005.

Prada also asserted the defense of laches contending that Diaz should have known that Prada was using the trademark when her husband observed Prada's use of her trademark at the tradeshow in the second half of 2005. Prada further asserted the defense that she was entitled to superior rights under the Inter-American Convention (IAC).

Result

The jury rendered a verdict holding that Diaz had priority, and that defendants Prada, Cuervo and Santa Maria willfully infringed the trademark. Diaz requested and was awarded statutory damages against all three defendants in the amount of $1,053,000 ($1 million from Prada; $50,000 from Cuervo; $3,000 from Santamaria).

Other Information

The district court adjudicated the issues of laches, the IAC and the scope of an injunction in post-trial motions. The district court rejected the defense of laches holding that Diaz did not unreasonably delay in filing the lawsuit in 2010 and further that Prada could not show any prejudice flowing from Diaz's alleged delay in filing the lawsuit. The district court held that the IAC confers no greater rights than are found under domestic law, whether that law is the common law or the Lanham Act. On that basis, the Court made a finding, independent of the finding of the jury that Diaz was entitled to priority and on that basis the Court rejected Prada's claim of priority based on the IAC. The Court granted Diaz a permanent injunction enjoining all defendants from infringing Diaz's trademark. Prada contended that she owned the domain name www.fajate.com and should be permitted to use it, particularly since she sells her shapewear outside the United States. The district court enjoined Prada from using the domain name www.fajate.com in the United States and its territories. FILING DATE: June 24, 2010.

Deliberation

two days

Length

five days