Romag Fasteners, Inc. v. Fossil, Inc.

Romag Fasteners, Inc. and Fossil, Inc. entered an agreement for Fossil to use Romag's magnetic snap fasteners in its leather goods. Romag later discovered that factories in China making Fossil products were using counterfeit Romag fasteners, and Fossil was doing little to stop the practice. Romag sued Fossil and certain retailers for trademark infringement under 15 U.S.C. § 1125(a). A jury found Fossil had infringed Romag's trademark and acted with "callous disregard" of Romag's rights, but rejected the accusation that Fossil acted willfully. Relying on Second Circuit precedent, the district court refused to award Romag Fossil's profits because the infringement was not willful. The Federal Circuit affirmed. The Supreme Court granted certiorari to resolve a circuit split on whether willfulness is a prerequisite to a profits award.

The Supreme Court unanimously held that a plaintiff in a trademark infringement suit is not required to show that a defendant willfully infringed the plaintiff's trademark as a precondition to a profits award. Justice Gorsuch delivered the opinion of the Court, joined by Chief Justice Roberts and Justices Thomas, Ginsburg, Breyer, Alito, Kagan, and Kavanaugh. Justice Alito filed a concurring opinion, joined by Justices Breyer and Kagan. Justice Sotomayor concurred in the judgment but did not join Gorsuch's opinion. The judgment of the Federal Circuit was vacated and the case remanded for further consideration.

Whether a plaintiff in a trademark infringement suit under § 1125(a) of the Lanham Act must show that the defendant willfully infringed the plaintiff's trademark as a precondition to recovering the defendant's profits under § 1117(a).

The decision resolved a longstanding circuit split and removed willfulness as an absolute precondition to recovering an infringer's profits under the Lanham Act. It clarified that a defendant's mental state remains a highly important consideration in determining whether a profits award is appropriate, but not an inflexible requirement. The ruling potentially strengthened the remedial options available to trademark owners, though commentators noted that profits were rarely awarded for innocent infringement in practice. The decision left lower courts to develop a more flexible, multi-factor analysis for determining when disgorgement of profits is warranted.