Justia U.S. 7th Circuit Court of Appeals Opinion Summaries

Illinois Tamale Company, a Chicago-based food manufacturer, brought a trademark infringement suit against LC Trademarks and Little Caesar Enterprises, alleging that Little Caesars’ launch and advertising of its “Crazy Puffs” product infringed Iltaco’s registered trademarks for “Pizza Puff” and “Puff.” Iltaco has sold its “Pizza Puff” product for decades and registered the “Pizza Puff” trademark in 2009 and the “Puff” mark in 2022. Little Caesars, a national pizza chain, began selling “Crazy Puffs” in 2024, marketing them with its established “Crazy” branding and trade dress, and included the phrase “4 Hand-Held Pizza Puffs” in small print as part of its advertising.After receiving a cease-and-desist letter from Iltaco, Little Caesars disputed the claims and continued its use of the contested names. Iltaco filed suit in the United States District Court for the Northern District of Illinois, asserting Lanham Act and related state law claims and moved for a preliminary injunction to stop Little Caesars from using “Crazy Puffs,” “Pizza Puff,” or “Puff.” The district court denied the injunction for “Crazy Puffs” and “Puff,” finding no sufficient likelihood of success on those claims, but granted the injunction for “Pizza Puff,” ruling that Iltaco was likely to prove infringement with respect to that mark.On appeal, the United States Court of Appeals for the Seventh Circuit reviewed the district court’s legal conclusions de novo and its factual findings for clear error. The Seventh Circuit held that the district court erred in granting the injunction for “Pizza Puff,” finding that Iltaco failed to show a likelihood of success in proving the mark was protectable and in rebutting Little Caesars’ fair use defense. The court affirmed the district court’s decision denying the injunction as to “Crazy Puffs” and “Puff.” Thus, the judgment was affirmed in part and reversed in part. View "Illinois Tamale Company, Inc. v. LC Trademarks, Inc." on Justia Law

CLEAResult Consulting, Inc. engaged NEXT Payment Solutions, Inc. to create a customized appointment scheduling software called the FAST Tool. After several years of use, CLEAResult acquired another company with its own scheduling platform, the DSMTracker, and decided to transition away from NEXT’s software. CLEAResult analyzed the FAST Tool’s functionality to enhance the DSMTracker, but was never given access to the FAST Tool’s underlying source code or algorithms. NEXT alleged that CLEAResult had secretly misappropriated trade secrets and brought claims for misappropriation under federal law and unjust enrichment under Illinois law.Reviewing the case, the United States District Court for the Northern District of Illinois first granted CLEAResult partial summary judgment on the trade secrets claim, finding NEXT had failed to sufficiently identify its alleged secrets. The court narrowed the claim and required NEXT to provide more detail, but NEXT submitted only vague descriptions of software modules. The court then granted summary judgment in full to CLEAResult, concluding NEXT’s descriptions did not specify protectable trade secrets. The court also granted CLEAResult’s motion in limine, precluding NEXT from pursuing an unjust enrichment claim based on a theory of misusing “other proprietary information,” determining this was a new theory not previously pled. NEXT then voluntarily dismissed its remaining claims, and final judgment was entered for CLEAResult.The United States Court of Appeals for the Seventh Circuit affirmed the district court’s rulings. It held that NEXT failed to identify trade secrets with sufficient specificity to survive summary judgment under the Defend Trade Secrets Act. The Seventh Circuit also found the district court did not abuse its discretion in excluding NEXT’s late-developed unjust enrichment theory, as this constituted an improper new claim. The final judgment in favor of CLEAResult was affirmed. View "NEXT Payment Solutions Inc. v CLEAResult Consulting, Inc." on Justia Law

A young music producer created an instrumental hip-hop beat and uploaded it online without first obtaining a copyright. After hearing a similar beat in a popular song by a well-known rapper, he registered a sound recording copyright for his track and later sued the rapper for copyright infringement, seeking damages and an injunction. The plaintiff alleged that the defendant had copied his digital recording, but did not obtain a musical composition copyright, which would have protected the underlying musical elements.In the United States District Court for the Northern District of Illinois, both parties failed to comply with local rules regarding summary judgment filings. The district court, exercising its discretion, chose not to penalize either side for these procedural lapses. On the merits, the court found that the plaintiff had not provided sufficient evidence to show that the defendant had duplicated the actual digital sound recording, as opposed to merely imitating the musical composition. The court granted summary judgment in favor of the defendant. The court also awarded costs to the defendant but denied his request for attorney’s fees, finding the plaintiff’s claims were not frivolous or objectively unreasonable.The United States Court of Appeals for the Seventh Circuit reviewed the case. It affirmed the district court’s decisions on all issues. The appellate court held that, for a sound recording copyright infringement claim, a plaintiff must present evidence of actual duplication of the digital recording, not just imitation of the musical composition. Because the plaintiff failed to provide such evidence, summary judgment for the defendant was proper. The appellate court also affirmed the district court’s discretionary decisions regarding enforcement of local rules and denial of attorney’s fees. View "Richardson v. Kharbouch" on Justia Law

TWD, LLC filed a complaint against Grunt Style LLC in 2018, alleging trademark infringement. Both companies sell goods with military-related trademarks. Grunt Style counterclaimed, asserting TWD was infringing on its prior trademark. The district court granted Grunt Style's motion for partial summary judgment in April 2022, dismissing all of TWD's claims. The case was reassigned to Judge Hunt, who held a bench trial in 2024 and ordered TWD to pay Grunt Style $739,500. Grunt Style moved to amend the judgment to include interest and permanent injunctive relief, which the district court granted in January 2025.TWD filed a notice of appeal from the amended judgment, which was docketed as appeal No. 25-1305. During a preliminary review, the Seventh Circuit identified a potential jurisdictional issue because the district court's judgment did not explicitly address TWD's counterclaims. The court directed the parties to address whether the judgment was deficient. TWD filed an amended notice of appeal, which was docketed as a new appeal, No. 25-1341. The district court later issued an indicative ruling, signaling its intent to correct the judgment if the case was remanded.The United States Court of Appeals for the Seventh Circuit agreed with the district court's solution and decided to remand the case for correction of the clerical mistake in the judgment. The court retained jurisdiction over the appeal and dismissed the second appeal (No. 25-1341) as unnecessary, without collecting an additional fee. The court emphasized the importance of clear and complete judgments to avoid jurisdictional issues and ensure appellate jurisdiction is clear. View "Grunt Style LLC v TWD, LLC" on Justia Law

Plaintiffs Republic Technologies (NA), LLC and Republic Tobacco, L.P. manufacture and market OCB brand organic hemp rolling papers, while defendant BBK Tobacco & Foods, LLP (HBI) markets RAW brand rolling papers. Republic sued HBI in 2016 for a declaration that OCB’s trade dress did not infringe RAW’s trade dress and later added false advertising claims. HBI counterclaimed, alleging that OCB’s trade dress infringed RAW’s trade dress. A jury trial in 2021 resulted in a mixed verdict, and the district court issued a permanent injunction against some of HBI’s advertising practices.The United States District Court for the Northern District of Illinois found HBI liable under Illinois law for false advertising but not under the federal Lanham Act. The jury also found that OCB’s trade dress for its 99-cent promotional pack infringed RAW’s trade dress, but not the full-priced pack. Republic’s motions for judgment as a matter of law and for a new trial were denied.The United States Court of Appeals for the Seventh Circuit reviewed the case. The court affirmed the district court’s decision, holding that the district court did not abuse its discretion in responding to the jury’s question about the definition of “consumer” and in denying Republic’s motion for a new trial. The court also upheld the jury’s finding of trade dress infringement, noting that sufficient evidence supported the jury’s verdict. Additionally, the court affirmed the district court’s permanent injunction, rejecting HBI’s arguments that the injunction was vague, overbroad, and improperly applied nationwide. The court concluded that the injunction was appropriately tailored to provide complete relief to Republic. View "Republic Technologies (NA), LLC v BBK Tobacco & Foods, LLP" on Justia Law

Dyson Technology, Ltd., a UK-based company, filed a trademark infringement lawsuit against multiple e-commerce stores for selling counterfeit Dyson products. Dyson sought remedies under the Lanham Act, which allows trademark holders to recover profits, damages, and costs from infringing parties. The defendants did not appear in court, leading to a default judgment in Dyson's favor. However, the district court awarded only $1,000 in statutory damages and denied Dyson's request to recover the infringing sellers' profits, stating that Dyson had only provided evidence of revenue, not profits.The United States District Court for the Northern District of Illinois, Eastern Division, handled the initial case. The court's decision to limit Dyson's award was based on its interpretation that revenue and profits are not the same, and it declined to assume that all revenue equaled profits.The United States Court of Appeals for the Seventh Circuit reviewed the case. The appellate court held that the district court erred in its interpretation of the Lanham Act. According to the Act, a prevailing plaintiff is entitled to the defendant's profits, and the defendant bears the burden of proving any costs or deductions. The appellate court found that Dyson's evidence of revenue was sufficient to establish profits, as the defendants did not provide evidence to the contrary. The court reversed the district court's decision and remanded the case for further proceedings, allowing the district court to adjust the award if deemed just based on the case's circumstances. View "Dyson Technology Limited v David 7 Store" on Justia Law

Charles Curry, Jr., a former competitive powerlifter and bodybuilder, started a nutritional supplements business called Get Diesel Nutrition in 2002. He began selling a testosterone-boosting supplement called "Diesel Test" in 2005. Revolution Laboratories, LLC, founded by Joshua and Barry Nussbaum, also sold a supplement called "Diesel Test" starting in 2016. Curry, acting without a lawyer, filed a lawsuit against Revolution and the Nussbaums in 2017, asserting trademark claims under the federal Lanham Act and Illinois common law. Curry later obtained counsel, and the case proceeded to a jury trial in May 2023, resulting in a verdict for Curry.The jury awarded Curry $2,500 in actual damages for loss of goodwill and reputation and $500,000 as disgorgement of Revolution’s profits from the infringement. Additionally, the jury awarded Curry $300,000 in punitive damages against each of Joshua, Barry, and Revolution, totaling $900,000. The district court later ruled that disgorgement of profits under the Lanham Act is an equitable remedy for the judge to decide and recalculated the appropriate profits award to be $547,095.44.The United States Court of Appeals for the Seventh Circuit reviewed the case. Defendants challenged the district court's decision to allow Curry's punitive damages request to go to the jury and argued that the punitive damage awards were excessive in violation of the Fourteenth Amendment’s due process clause. The Seventh Circuit affirmed the district court's decision, holding that the district court did not abuse its discretion in allowing Curry to seek punitive damages and that the punitive damage awards were not unconstitutionally excessive. The court concluded that the ratio of punitive damages to the combined compensatory and disgorgement awards was constitutionally permissible. View "Curry v. Revolution Laboratories, LLC" on Justia Law

In 2018, John Burns and Rajeev Arora, representing Moca Financial Inc., engaged in discussions with Manoj Baheti, represented by Yash Venture Holdings, LLC, about a potential investment. The alleged agreement was that Yash would provide $600,000 worth of software development in exchange for a 15% non-dilutable ownership interest in Moca. However, subsequent documents and communications indicated ongoing negotiations and changes in terms, including a reduction of Yash's proposed stake and a shift from software development to a cash investment. Yash eventually refused to sign the final documents, leading to the current litigation.The United States District Court for the Central District of Illinois dismissed most of Yash's claims, including breach of contract, fraud, and securities fraud, but allowed the equitable estoppel and copyright infringement claims to proceed. Yash later voluntarily dismissed the remaining claims, and the district court entered final judgment, prompting Yash to appeal.The United States Court of Appeals for the Seventh Circuit reviewed the case de novo. The court found that Yash did not adequately allege the existence of an enforceable contract, as there was no meeting of the minds on the material term of whether the ownership interest was non-dilutable. Consequently, the breach of contract claim failed. Similarly, the promissory estoppel claim failed due to the lack of an unambiguous promise. The fraud and securities fraud claims were also dismissed because they relied on the existence of a non-dilutable ownership interest, which was not sufficiently alleged. Lastly, the breach of fiduciary duty claims failed as there was no enforceable stock subscription agreement to establish a fiduciary duty. The Seventh Circuit affirmed the district court's judgment. View "Yash Venture Holdings, LLC v. Moca Financial, Inc." on Justia Law

Dr. John Insall, an orthopedic surgeon, developed and patented knee replacement devices, which he licensed to Zimmer Biomet Holdings, Inc. In return, Zimmer agreed to pay royalties to Insall, and later to his estate after his death. When Insall’s last patent expired in 2018, Zimmer ceased royalty payments, claiming the obligation had ended. The dispute was submitted to arbitration, where the Estate prevailed. Zimmer then sought to vacate the arbitration award in district court, arguing that continuing royalty payments violated public policy. The district court confirmed the arbitration award.The United States District Court for the Northern District of Illinois reviewed the case. Zimmer argued that the arbitration award should be vacated based on public policy grounds, citing Supreme Court decisions in Brulotte v. Thys Co. and Kimble v. Marvel Entertainment, LLC, which prohibit collecting royalties on expired patents. The district court rejected Zimmer’s argument and confirmed the arbitration award, leading to Zimmer’s appeal.The United States Court of Appeals for the Seventh Circuit reviewed the case. The court emphasized the limited scope of judicial review over arbitration awards under the Federal Arbitration Act (FAA). The court found that the arbitration panel had correctly interpreted the 1998 amendments to the agreement, which untethered the royalty payments from the patents themselves, making them based on the marketing and branding of the NexGen Knee products. Consequently, the court held that the arbitration award did not violate public policy as outlined in Brulotte and Kimble. The Seventh Circuit affirmed the district court’s decision and confirmed the arbitration award in favor of Insall’s Estate. View "Zimmer Biomet Holdings, Inc. v. Insall" on Justia Law

This case involves a dispute between Motorola Solutions, Inc. and Hytera Communications Corporation Ltd., two global competitors in the market for two-way radio systems. After struggling to develop its own competing products, Hytera poached three engineers from Motorola, who, before leaving Motorola, downloaded thousands of documents and files containing Motorola's trade secrets and copyrighted source code. Using this stolen material, Hytera launched a line of radios that were functionally indistinguishable from Motorola's radios. In 2017, Motorola sued Hytera for copyright infringement and trade secret misappropriation.The jury found that Hytera had violated both the Defend Trade Secrets Act of 2016 (DTSA) and the Copyright Act, awarding compensatory and punitive damages totaling $764.6 million. The district court later reduced the award to $543.7 million and denied Motorola’s request for a permanent injunction. Both parties appealed.The United States Court of Appeals for the Seventh Circuit held that the district court must recalculate copyright damages, which will need to be reduced substantially from the original award of $136.3 million. The court affirmed the district court’s award of $135.8 million in compensatory damages and $271.6 million in punitive damages under the DTSA. The court also found that the district court erred in denying Motorola’s motion for reconsideration of the denial of permanent injunctive relief. The case was remanded for the district court to reconsider the issue of permanent injunctive relief. View "Motorola Solutions, Inc. v. Hytera Communications Corporation Ltd." on Justia Law