It goes without saying that trademark infringement litigation costs are important to be aware of during the naming process, and even when deciding whether to conduct a trademark search in the first place. However, generally, law firms do not publish what trademark infringement litigation costs will be. All the trademark owners are told is that is will be expensive. In this post, we are going to show just how expensive trademark infringement litigations costs can be.
Trademark disputes are primarily resolved in two forums: United States District Court or the Trademark Trial and Appeal Board. The Trademark Trial and Appeal Board is an administrative tribunal of the United States Patent and Trademark Office. The TTAB decides only the right to registration. United States District Court’s decide trademark infringement cases regarding the use of two trademarks. Although, District Court’s can decide the right to registration as well. Final decisions from the Trademark Trial and Appeal Board are reviewed by either the United States Court of Appeals or a United States District Court.
Even though certain presumptions apply in a TTAB proceeding that are not available in a District Court case, from a cost perspective, a TTAB proceeding is a lot like a lawsuit in District Court. Everyone has sticker shock when they first learn how much a TTAB proceeding or District Court case may cost. To take a TTAB proceeding all the way to a final decision could cost $300,000 or more. To take a District Court case to a final decision could cost $500,000 or more. And these costs do not include any appeal costs.
How do these numbers breakdown? Here is an example budget for a TTAB proceeding:
Legal Research/Analysis/Investigation: $10,000 – $15,000
Preparation and filing of the Notice of Opposition: $3,000 – $4,000
Initial Disclosures and Discovery Conference: $1,000 – $1,500
Fact Discovery: $20,000- $30,000
Motion Practice: $10,000 – $15,000
Motion for Summary Judgment: $25,000-$35,000
Expert Discovery: $50,000 -$80,000
Preparation of Pretrial Disclosures: $2,000 – $3,000
Notice of Reliance, Trial Depositions, Rebuttal: $40,000 – $60,000
Preparation of Trial Brief and Rebuttal Brief: $30,000 – $40,000
Prepare for and attend oral hearing: $15,000-$20,000
Total fee estimate: $206,000 – $303,500
Motions for summary judgement are usually not pursued and more often than not expert discovery is unnecessary in a TTAB proceeding. Nevertheless, you are still talking about a six figure bill when it is all said and done. And a District Court case is going to be more.
The problem with any type of litigation is that you cannot control how the other side will litigate. Take fact discovery as an example in a TTAB proceeding. Each side is allowed 75 Interrogatories. An Interrogatory is simply a written question answered under oath. Because of the presumptions that apply in a TTAB matter, 75 Interrogatories is way more than any party needs. By contrast, the default number of Interrogatories for each party is 25 in a District Court case and the presumptions don’t apply.
Nevertheless, unless the other party will agree to serve less than 75 Interrogatories, you may be in a position of having your attorneys prepare answers for 75 written questions. And rarely does a party agree to serve less discovery than what the rules allow.
Trademark disputes are avoidable if you conduct a trademark search before adopting a mark.