By Wallace Feng
In Curry v. Revolution Laboratories, LLC., No. 23-2850 (7th Cir. Dec. 19, 2024), the Seventh Circuit affirmed a $900,000 punitive damages award in a trademark infringement action involving the non-registered mark “Diesel Test” asserted by plaintiff Charles Curry Jr. (“Plaintiff”) against defendants Revolution Laboratories, LLC and its two executive officers (collectively, “Defendants”).
At trial, Plaintiff obtained an award of $2,500 in compensatory damages for loss of goodwill and reputation and $500,000 as disgorgement of Defendants’ profits, which the district court then increased to $547,095.44. Curry, No. 23-2850 at 2. Plaintiff also obtained $300,000 in punitive damages against each of the three Defendants pursuant to Illinois common law. Id.
On appeal, Defendants challenged the propriety of the punitive damages award. The Seventh Circuit overruled the challenge, explaining that the award was permitted under the framework established by the Supreme Court in BMW of N. Am., Inc. v. Gore, 517 U.S. 559 (1996). The Seventh Circuit explained that Gore required that courts consider the following “guideposts” when evaluating the appropriateness of punitive damages: “(1) the ‘degree of reprehensibility’ of the defendant’s misconduct; (2) the ‘disparity between the harm or potential harm’ suffered by the plaintiff and the punitive damage award; and (3) the difference between the punitive damage award and ‘the civil penalties authorized or imposed in comparable cases.’” Curry, No. 23-2850 at 16-17 (citing Gore, 517 U.S. at 575).
The Seventh Circuit observed that the Gore guideposts supported the damages award. Regarding the “degree of reprehensibility,” the Seventh Circuit took into account Defendants’ willingness to continue selling the accused product after receiving cease-and-desist notices from Plaintiff and after Amazon removed the listing for the accused product online. See id. at 17-22. Regarding the “disparity between the harm or potential harm” associated with each defendant and the punitive damage award, the Seventh Circuit determined that the disparity was not vast once the disgorged amount is considered. See id. at 25-32. Lastly, regarding “the difference between the punitive damage award and ‘the civil penalties authorized or imposed in comparable cases,’” the Seventh Circuit held the Lanham Act, which the parties agreed was the appropriate comparator, allowed “awards above what the jury and court awarded here.” Id. at 33.
